Social Security Benefits

Social Security Administration Moves To Abolish Treating Physician’s Rule. Backlog Of Hearing Requests Sure To Worsen.

New Rule May Worsen Backlog For Social Security Disability Claimants

By the time Stephenie Hashmi of Lenexa, Kansas, was in her mid-20s, she had achieved a lifelong dream: She was the charge nurse at one of Kansas City’s largest intensive care units. But even as she cared for patients, she realized something was off with her own health.

“I remember just feeling tired and feeling sick and hurting, and not knowing why my joints and body was hurting,” Hashmi says.

Hashmi was diagnosed with systemic lupus, a disease in which the body’s immune system attacks its own tissues and organs.

She’s had surgeries and treatments, but now, at age 41, Hashmi is often bedridden. She finally had to leave her job about 6 years ago, but when she applied for Social Security disability benefits, she was denied.

                                                                                            

“I just started bawling. Because I felt like, if they looked at my records or read these notes, surely they would understand my situation,” Hashmi says.

Lisa Ekman, director of government affairs for the National Organization of Social Security Claimants Representatives, says Hashmi’s struggle with the application process is not unusual.

“It is not easy to get disability benefits. It’s a very complicated and difficult process,” Ekman says.

Right now, just about 45 percent of people who apply for Social Security disability benefits are accepted, and getting a hearing takes an average of nearly 600 days.

The Kansas City office’s average hearing time is closer to 500 days, but its approval rate is slight lower at 40 percent.

The Backlog started snowballing about 10 years ago, around the time Jason Fichtner became acting Deputy Commissioner of the Social Security Administration (SSA).

He says that during the Great Recession, a lot of people who had disabilities applied but weren’t necessarily unable to work.

“But they’re on the margin,” Fichtner says. “They can work, but when the recession happens, those are the first people who tend to lose their jobs, and then they apply for disability insurance.”

There are now more than a million people across the country waiting for hearings. Adding to the strain, the Social Security Administration’s core operating budget has shrunk by 10 percent since 2010.

This spring, the SSA introduced changes to fight fraud and streamline the application process, including a new fraud-fighting measure that removes the special consideration given to a person’s long-time doctor.  (This is known as The Treating Physician’s Rule)

Lisa Ekman says this is a mistake.

“Those changes would now put the evidence from a treating physician on the same weight as evidence from a medical consultant employed to do a one-time brief examination or a medical consultant they had do a review of the paper file and may have never examined the individual,” Ekman says.

She says this could lead to more denials for disabled people with complex conditions like lupus, multiple sclerosis or schizophrenia. These illnesses can affect patients in very different ways and may be hard for an outside doctor or nurse to assess.

She says more denials will lead to more appeals, which will only increase the backlog.

She is correct. The Treating Physician’s Opinion is controlling.

https://judgelondonsteverson.me/2016/06/24/the-treating-physician-rule-is-controlling/

But former administrator Fichtner, now a senior research fellow at George Mason University’s Mercatus Center, says the SSA is obligated to weed out any fraud it can, including the admittedly rare cases of treating physicians tipping the scale in favor of their patients.

He says the SSA can still prioritize applicants.

“For patients that are really in dire condition and really have major disabilities, I don’t think they have to worry about this rule change,” Fichtner says.

He acknowledges, however, that the backlog needs attention and says the agency has safeguards to monitor whether the rule is working.

Back in her kitchen in Lenexa, Stephenie Hashmi’s husband Shawn prepares a family dinner she won’t be able to eat because she’s having problems with her esophagus.

Stephenie puts on a brave smile, but the progression of her illness and the ordeal with Social Security have made her increasingly pessimistic.

After several rejections, she’s now on her final appeal. Her hearing is scheduled for November – of   2018.

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SSA Judge Pleads Guilty To Taking Bribes

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A former Social Security Administration (SSA) Administrative Law Judge (ALJ) pleaded guilty on  May 13, 2017 to taking more than $609,000 in bribes from a disability lawyer who called himself “Mr. Social Security.”

The former judge, ALJ David Black Daugherty, 81, of Myrtle Beach, South Carolina, pleaded guilty to two counts of receiving illegal gratuities, according to a press release from the U.S. Department of Justice and stories by the Washington Times and the Lexington (Kentucky) Herald-Leader.

Daugherty, who heard cases in West Virginia, was accused of taking payments to make favorable rulings in more than 3,100 cases for clients represented by Kentucky lawyer Eric Conn, obligating the government to pay more than $550 million in lifetime disability payments.

Conn, who once called himself “Mr. Social Security,” pleaded guilty in March. He is scheduled to be sentenced in July, according to the Herald-Leader.

Daugherty admitted he sought out Conn’s cases, told him what type of medical evidence to submit, and awarded benefits without holding hearings. Daugherty accepted the illegal payments between November 2004 to April 2011, according to the press release.

The government is holding new hearings to determine whether the claimants in the cases are entitled to benefits. More than half of the applications have since been disapproved, according to the Washington Times. Many have unfortunately committed suicide.

The actual payout by the Social Security Administration in the cases was $46.5 million, an amount that Conn promised to pay the government. He also promised to pay $5.7 million, representing the fees he earned in the cases.

Daugherty has agreed to pay the government $609,000. He is scheduled to be sentenced on Aug. 25. The charges carry a maximum prison sentence of four years, according to the Herald-Leader.

Charges are still pending against a psychologist accused of falsifying mental impairment evaluations.

(By Debra Cassens Weiss)

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Granny Kills, Then Steals Dead Husband’s Social Security Benefits

Granny Kills and Steals; She Killed Husband, Then Collected His Social Security Benefits


A federal grand jury indicted Opal Elaine Tillman in April 2017 for fraudulently claiming nearly $168,000 in Social Security widow’s benefits on the death of a husband she killed, announced Acting U.S. Attorney Robert O. Posey . A six-count indictment filed in U.S. District Court charges Opal Elaine Tillman, 71, with five counts of wire fraud for causing the SSA to wire benefit payments, which Tillman was not entitled to receive, to her account at Regions Bank in Jefferson County between May 2012 and September 2016. Count Six of the indictment charges Tillman with theft of government property for stealing more than $100,000 from the SSA. The indictment seeks to have Tillman forfeit $167,830 to the government.
According to the indictment, Tillman was convicted in Alabama in June 1988 for killing her husband, Walter R. Tillman, on March 1, 1987. The month he died, Opal Tillman applied for Social Security Title II benefits on her husband’s work record. Title II benefits encompass old age, survivor and disability insurance payments. In her application Tillman wrote a statement acknowledging that she understood that “if I am convicted of felonious homicide any social security monies I receive on Mr. Tillman’s Social security record will constitute an over-payment and I will be liable to repay this money,” according to the indictment. She then requested monthly benefits for her and her children to begin as soon as possible.
While Opal Tillman was in prison in November 1988, the SSA notified her of an over-payment of benefits and explained: “A person who has been convicted of the felonious and intentional homicide of a wage earner cannot be entitled to monthly benefits, underpayments, or the lump-sum death payment on the earnings record of that wage earner,” according to the indictment.
Opal Tillman was released from prison into the Jefferson County Community Corrections Program in December 1996.
In October 2009, she applied by telephone to the SSA for widow’s benefits on the work record of Walter Roderick Tillman, according to the indictment. Opal Tillman provided her deceased husband’s Social Security number, dates of birth and death, and verification of their marriage for the application, the indictment charges.
Opal Tillman began receiving benefits Nov. 9, 2009, on the work record of the man she killed, according to the indictment. The monthly benefits continued until Sept. 14, 2016.
The maximum penalty for wire fraud is 20 years in prison and a $250,000 fine. The maximum penalty for theft of government property is 10 years in prison and a $250,000 fine.
An indictment contains only charges. A defendant is presumed innocent unless and until proven guilty.

In an unrelated case, Opal Elaine Tillman was arrested in 2015 on charges that she stole stole more than $60l,000 from an elderly couple she was supposed to be caring for. In that case, she pleaded guilty last month to financial exploitation of the elderly and was sentenced to 10 years in prison with 18 months to serve.
While Tillman was in prison in November 1988, the SSA notified her of an overpayment of benefits. They explained to her, “A person who has been convicted of the felonious and intentional homicide of a wage earner cannot be entitled to monthly benefits, underpayments, or the lump-sum death payment on the earnings record of that wage earner.”
Tillman was sentenced to 35 years in prison for her husband’s death, but in December 1996 was released from prison into the Jefferson County Community Corrections program.
In 2009, federal authorities say, she applied by telephone to the SSA for widow’s benefits on the work record of her dead husband. For the application, she provided his Social Security number, dates of birth and death, and verification of their marriage. She began receiving those benefits on Nov. 9, 2009 on the work record of the man she killed, according to the indictment. Those monthly payments continued until Sept. 14, 2016.
The maximum penalty for wire fraud is 20 years in prison and a $250.000 fine. The maximum penalty for theft of government property is 10 years in prison and a $250,000 fine.

“I think there is a special place for people that take advantage of our senior citizens,” Chief Deputy Randy Christian said of Opal Elaine Tillman’s arrest.

Two years ago, Tillman was working as a housekeeper and caregiver for an elderly Jefferson County couple. The Jefferson County Sheriff’s Office received a complaint that she had stolen cash and property from an 87-year-old woman and her husband.
Family members told investigators they had noticed several suspicious transactions on the victims’ checking account. Tillman had been working as a housekeeper for the victims in 2011 on a part-time basis, but had taken on more responsibilities as the wife’s health declined.
In all, authorities said, Tillman stole more than $60l,000 from the couple. “I think there is a special place for people that take advantage of our senior citizens, most especially those placed in a position of trust,” Jefferson County sheriff’s Chief Deputy Randy Christian said at the time.
Tillman pleaded guilty to those charges on April 4, 2017. She is currently listed as an inmate at Julia Tutwiler Prison for Women. Her parole on the murder charge has been revoked. Her minimum release date is 2023, but she will come up for a parole hearing next year on the state charges.
A trial date on the new, federal charges has not been announced.

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The Social Security Administration Must Follow Its Own Regulations

7th Circuit orders disability case back to administrative law judge

Because the Social Security Administration (SSA) Appeals Council (AC) did not consider new evidence when it was presented – despite its own regulations requiring it to do so – the 7th Circuit Court of Appeals sent a disability insurance benefits case back to the Administrative Law Judge (ALJ) for further proceedings.

At the time of the hearing on Angela Farrell’s application for disability benefits, she was married with two children and extremely overweight. She suffered from multiple issues, including anxiety, insomnia, fibromyalgia, and plantar fasciitis. Her initial application was denied, but the Appeals Council remanded her case for reconsideration. On remand, the ALJ again ruled against her, in part because of Farrell’s failure to establish definitively that she suffered from fibromyalgia.

This time, the AC affirmed the ALJ’s decision, despite new evidence before the AC that confirmed Farrell’s fibromyalgia. The District Court also affirmed.

In addition to finding the Appeals Council didn’t follow its own regulations that require it to consider “new and material evidence,” the 7th Circuit found several other aspects of the ALJ’s decision independently require correction, including that the ALJ “failed to grapple properly with the competing medical opinions” in considering Farrell’s application.

Her Treating Physician (TP), Dr. Sarah Beyer, recorded Farrell suffered from several conditions and alluded to the possibility of Farrell suffering from fibromyalgia.

The other Consultative Examining (CE) Physicians who reviewed Farrell’s file as part of the application evaluation process believe that Farrell only had “moderate difficulties” or “mild restrictions on Average Daily Activity Level (ADL).” One doctor testified there was no evidence of a confirmed diagnosis of fibromyalgia or anything that would give rise to arthritic pain.

The 7th Circuit concluded in Angela M. Farrell v. Michael J. Astrue, Commissioner of Social Security, 11-3589,  that the ALJ’s residual functional capacity determination for Farrell improperly discounted the Treating Physician, Dr. Beyer’s medical opinions and that the RFC determination was based on an incomplete assessment of the record.

The judges sent the case back to the ALJ for further proceedings. REMANDED back to SSA ALJ.

This is the Case of  Angela M. Farrell v. Michael J. Astrue, Commissioner of Social Security, 11-3589.

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Undocumented Workers Are Keeping Social Security Afloat

 

In 2013, analysts at the Social Security Administration calculated that in 2010 undocumented immigrants had paid $13 billion into the system and were making on average $34,000 a year at the time. From 1996 to 2003, undocumented workers paid a combined $90 billion into both Social Security and Medicare.

Since 1996, immigrants who didn’t qualify to get a Social Security card numbers have been able to apply for an Individual Taxpayer Identification Number (ITIN) from the IRS. ITINs were originally granted to foreign citizens who were active investors in the American real estate market.

A substantial percentage of undocumented immigrants in the U.S. pay billions in taxes annually and own their own homes, according to a 50 state report from the Institute on Taxation and Economic Policy (The Study).

With an IRS ITIN number, undocumented residents can legally open a bank account and apply for mortgage financing and close on a real estate transaction.

“Contrary to a lot of myths out there, The Study shows that the undocumented pay a very significant share of their income to state and local taxes,” Meg Wiehe, a co-author of the report told CBS MoneyWatch. “They are also establishing roots here because they are committed to their communities.”

One in three of the nation’s undocumented families own a home, according to the ITEP report. States such as Idaho and New Mexico report undocumented ownership rates as high as 46 percent. Those statistics are based on research done by the Migration Policy Institute and data collected by the U.S. Census’s American Community Survey.

Expert opinion remains sharply divided on the impact of the undocumented on the U.S. economy.

While analysts at the conservative Heritage Foundation concede undocumented immigrant households do contribute tax revenue, they make the case that what they contribute is far outweighed by what their presence here in the U.S. costs taxpayers.

“In 2010, the average unlawful immigrant household received around $24,721 in government benefits and services while paying some $10,334 in taxes,” according to Robert Rector and Jason Richwine in their analysis for the Heritage Foundation.

“This generated an average annual fiscal deficit (benefits received minus taxes paid) of around $14,387 per household,” their analysis said. “This cost had to be borne by U.S. taxpayers. Amnesty would provide unlawful households with access to over 80 means-tested welfare programs, Obamacare, Social Security, and Medicare. The fiscal deficit for each household would soar.”

While the expert debate over this hot button issue has raged for years, Pew Research Center polling suggests American public opinion has shifted greatly since the early 1990s. In a 2015 poll, 45 percent of those surveyed expressed the opinion that immigrants were a net benefit for the U.S. versus 37 percent who felt their presence had a negative impact.

 

One of the ironies of the challenging financial future faced by the Social Security Administration is this seldom-discussed fact: Undocumented workers contribute about $13 billion per year to the Social Security Trust Fund, and only get back a small fraction, adding a bit of black ink to a balance sheet in sore need of a boost. These Social Security payments are a proxy of sorts for the potential power of these workers who now stand in the shadows of the economy.

These immigrants are often accused of creating outsize social services costs, but in this important instance the opposite is true. Undocumented workers using fake, invalid, or borrowed Social Security numbers are subject to payroll taxes but usually receive nothing back.

The extent of their contributions hints at the vast scale of the underground economy.

The chief actuary of the Social Security Administration estimates that, out of the approximately 7 million unauthorized workers currently in the US labor force, about 3 million use either false or expired Social Security numbers.

The payroll taxes paid by these unauthorized workers go into the Social Security’s “Earnings Suspense File” — in effect, money without a lawful home.

“You could say legitimately that had we not received the contributions that we have had in the past from undocumented immigrants . . . that would of course diminish our ability to be paying benefits for as long as we now can,”. Undocumented immigrants have contributed $100 billion into Social Security over the last decade.

Major immigration reform legislation would provide work authorization and Social Security numbers for an estimated 11 million immigrants working here illegally. But without changes to protect Social Security, illegal workers whose status later changes could become entitled to benefits based on jobs worked under fake and invalid Social Security numbers. Social Security could be on the hook for hundreds of billions in new liabilities according to a new  research report based on data from the Social Security Administration.

Unauthorized immigrants getting jobs show employers false or invalid Social Security numbers. When the Social Security Administration receives copies of W2s in which the name and Social Security number do not match those on Social Security’s records, they go into the Earnings Suspense File (ESF). The W2s remain on file until the earnings can be reconciled with the real worker, even if that occurs years later. Since 2000, the Social Security Administration has received about 9.3 million such W2s per year on average, representing more than $69.4 billion per year in earnings.

The earnings reported to the ESF over the past 11 years now total more than $763.5 billion, unadjusted for inflation. “Those earnings are important, because that’s what the Social Security Administration uses to determine entitlement and initial benefit amounts — not the amount of taxes paid in,” .

Although Social Security is aware of the problem, no government estimates of the potential future cost of benefits based on work under fake Social Security numbers exist.

Immigration advocates say that the taxes on earnings worked under invalid Social Security numbers help boost Social Security’s financing and that workers would have little chance of collecting benefits. “But that would change under immigration reform that provides work authorization”. “Work authorization and a valid Social Security number are the two requirements that would allow former unauthorized workers to file a claim for benefits.”

That could have significant implications for future Social Security costs because, under current law, the fraudulent use of Social Security numbers to gain employment is not penalized. “One would think that the earnings under fake Social Security numbers would not be used to calculate Social Security benefits. But to the contrary, under current policies, those earnings can be reinstated — no questions asked”.

Social Security uses all earnings to determine entitlement even for jobs worked under fake Social Security numbers. If workers have kept evidence of earnings, like copies of their W2s, tax return earnings under invalid Social Security numbers would be reinstated to the new valid number.

“Congress is considering Social Security changes that would cut the benefits of U.S. citizens and authorized workers who paid into the system under valid Social Security numbers”. “Yet our current polices reward people for the use of fraudulent Social Security numbers, undermining the financial solvency of the program”.

“You could say legitimately that had we not received the contributions that we have had in the past from undocumented immigrants . . . that would of course diminish our ability to be paying benefits for as long as we now can,”. Undocumented immigrants have contributed $100 billion into Social Security over the last decade.

(In part based on an article by Robert Hennelly in MoneyWatch February 29, 2016)

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Why The Rich Are Getting Richer and The Poor Are Getting Poorer

Inequality, class and life expectancy in America

15 February 2016

A study by Brookings Institution economists released Friday documents a sharp increase in life span divergences between the rich and the poor in America. The report, based on an analysis of Census Bureau and Social Security Administration data, concludes that for men born in 1950, the gap in life expectancy between the top 10 percent of wage earners and the bottom 10 percent is more than double the gap for their counterparts born in 1920.

 (DISCLAIMER: I neither agree nor disagree with the social or political philosophy expressed in this article. It is presented merely to disclose the underlying factual basis of the arguments put forth. The Facts and the Statistics speak for themselves.)

For those born in 1920, there was a six-year differential between rich and poor. For those born in 1950, that difference had reached 14 years. For women, the gap grew from 4.7 years to 13 years, almost tripling.

Overall, life expectancy for the bottom 10 percent improved by just 3 percent for men born in 1950 over those born in 1920. For the top 10 percent, it soared by about 28 percent.

Life expectancy for the bottom 10 percent of male wage earners born in 1950 rose by less than one year compared to that for male workers born 40 years earlier—to 73.6 from 72.9. But for the top 10 percent, life expectancy leapt to 87.2 from 79.1.

The United States ranks among the worst so-called rich countries when it comes to life expectancy. But its low ranking is entirely due to the poor health and high mortality of low-income Americans. According to the Social Security Administration, life expectancy for the wealthiest US men at age 60 was just below the rates for Iceland and Japan, two countries with the highest levels. Americans in the bottom quarter of the wage scale, on the other hand, ranked just above Poland and the Czech Republic.

Life-expectancy is the most basic indicator of social well-being. The minimal increase for low-income workers and the widening disparity between the poor and the rich is a stark commentary on the immense growth of social inequality and class polarization in the United States. It underscores the fact that socioeconomic class is the fundamental category of social life under capitalism—one that conditions every aspect of life, including its length.

The Brookings Institution findings shed further light on the catastrophic decline in the social position of the American working class. They follow recent reports showing a sharp rise in death rates for both young and middle-aged white workers, primarily due to drug abuse, alcoholism and suicide. Other recent reports have shown a dramatic decline in life expectancy for poorer middle-aged Americans and a reversal of decades of declining infant mortality.

It is no mystery what is behind this vast social retrogression. It is the product of the decay of American capitalism and a four-decade-long offensive by the ruling elite against the working class. From Reagan to the Obama administration, Democrats and Republicans alike have overseen a corporate-government assault on the jobs, wages, pensions and health benefits of working people.

The ruling elite has dismantled the bulk of the country’s industrial infrastructure, destroying decent-paying jobs by the millions, and turned to the most parasitic and criminal forms of financial speculation as the main source of its profit and private wealth. Untold trillions have been squandered to finance perpetual war and the maniacal self-enrichment of the top 1 percent and 0.1 percent.

The basic infrastructure of the country has been starved of funds and left to rot, to the point where uncounted millions of people are being poisoned with lead and other toxins from corroded water systems. Flint, Michigan is just the tip of the iceberg.

Under Obama, this social counterrevolution has been intensified. The financial meltdown of 2008 has been utilized by the same forces that precipitated the crash to carry through a reordering of social relations aimed at reversing every social gain won by the working class in the course of a century of struggle. A central target of the attack is health care for working people.

Obamacare is the spearhead of a worked-out strategy to reduce the quantity and quality of health care available to workers and reorganize the health care system directly on a class basis. Corporate and government costs are to be slashed by gutting employer-paid health care, forcing workers individually to buy expensive, bare-bones plans from the insurance monopolies, and rationing drugs, tests and medical procedures to make them inaccessible to workers.

The rise in mortality for workers and the widening of the life span gap between rich and poor are not simply the outcome of impersonal economic forces. In corporate boardrooms, think tanks and state agencies, the ruling class is working to lower working class life expectancy. In late 2013, the Center for Strategic and International Studies, a Washington think tank with the closest ties to the Pentagon and the CIA, published two policy papers decrying the “waste” of money on health care for the elderly. The clear message was that ordinary people were living much too long and diverting resources needed by the military to wage war around the world.

The social and economic chasm in America finds a political expression in the vast disconnect between the entire political establishment and the masses of working people. Neither party nor any of their presidential candidates, the self-described “socialist” Bernie Sanders included, can seriously address the real state of social conditions or offer a serious program to address the crisis.

In his final State of the Union Address last month, Obama presented an absurd picture of a resurgent economy. “The United States of America, right now,” he declared, “has the strongest, most durable economy in the world… Anyone claiming that America’s economy is in decline is peddling fiction.”

In the race for the Democratic presidential nomination, Hillary Clinton and Sanders are seeking to outdo one another in seizing the mantle of the Obama administration and praising its supposed social and economic achievements.

They cannot address the real conditions facing the masses of working people because they defend the capitalist system, which is the source of the social disaster. The remedy must be based on an understanding of the disease. It is the building of an independent socialist and revolutionary movement uniting the entire working class, in the US and around the world.

(Barry Grey, World Socialist Web Site)

(DISCLAIMER: I neither agree nor disagree with the social or political philosophy expressed in this article. It is presented merely to disclose the underlying factual basis of the arguments put forth. The Facts and the Statistics speak for themselves.)

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You Have To Pay Taxes On Social Security Retirement Benefits

Tax On Social Security May Come As Surprise

The requirement to pay income tax on Social Security Retirement benefits may come as a surprise to many retirees. Baby boomers beware. It is a fact.

For an individual, 50 percent of Social Security benefits are subject to income tax if the individual’s income is more than $25,000 a year and 85 percent of benefits are subject to tax if the income is more than $34,000 a year, according to the Social Security Administration.

For a couple, the respective income levels are $32,000 and $44,000. Income for these purposes includes adjusted gross income, tax-exempt interest income and half of the Social Security benefits.

 Social Security is a primary source of retirement income for tens of millions of Americans, and financial planners urge people to take maximum advantage of the Social Security benefits they’ve earned. For many planners, that means advising their clients to wait beyond the early claiming age of 62 before taking their benefits. But even though waiting can be smart for some people, there are good reasons for others to go ahead and take benefits as soon as possible.

These are desperate times for many people in America who were once considered among the Middle Class. They have seen their living standards decline and are struggling to make ends meet. Many were laid off in the last eight years and have not been able to find new jobs. They are not counted in the Unemployment Statistics because they have dropped out of the labor pool. Many are between the ages of 50 and 65 and do not yet qualify for Social Security Retirement Benefits. They have not even reached the age when they would be eligible to apply for early retirement. For many Baby Boomers that is around age 62.

Social Security pays out smaller monthly benefits to those who claim early, but the extra payments give early claimers a head start over those who wait. The Social Security Administration’s goal initially was to set things up so that timing didn’t have a material impact on how much you would receive in benefits over your lifetime.

If you don’t expect you’ll live as long as the typical Social Security recipient, then claiming early can make sense. Keep in mind, though, that if you have a spouse or other loved ones who will claim benefits based on your work record, your decision can affect their benefits as well. But if you don’t have family members who will claim survivor benefits, then you’ll end up better off claiming early if you expect not to reach the age that the SSA’s life expectancy projections would predict.

The primary reason to wait to take Social Security benefits is one based on mathematics and maximizing your family’s total benefits. For some, however, getting the biggest check possible isn’t as valuable as living the life they want.

For many, taking Social Security early allows them to retire at an earlier age or cut back on their hours. Others prefer to use the additional cash early in their retirement when they can still enjoy it the most. Financial planners would tell you that you’re leaving money on the table in many cases, but the actual value of those additional dollars might not be as much as getting to pick the time when the money will have the greatest impact.

People who die earlier should start drawing their Social Security Retirement Benefits earlier. Life-expectancy is the most basic indicator of social well-being. The minimal increase for low-income workers and the widening disparity between the poor and the rich is a stark commentary on the immense growth of social inequality and class polarization in the United States. It underscores the fact that socioeconomic class is the fundamental category of social life under capitalism—one that conditions every aspect of life, including its length.

The Brookings Institution findings shed further light on the catastrophic decline in the social position of the American working class. They follow recent reports showing a sharp rise in death rates for both young and middle-aged white workers, primarily due to drug abuse, alcoholism and suicide. Other recent reports have shown a dramatic decline in life expectancy for poorer middle-aged Americans and a reversal of decades of declining infant mortality.

Late last year, lawmakers made changes to benefits available to Social Security participants who waited until full retirement age to claim benefits. Among them were the repeal of the restricted application or file-as-a-spouse-first strategy and the file-and-suspend strategy. Under a restricted application, those who reached full retirement age could elect to claim only spousal benefits, leaving their own retirement benefits untouched. Similarly, using file and suspend, someone at full retirement age or older could file for benefits but immediately suspend them and still allow a spouse to claim spousal benefits.

As a result of these legal changes, there’s no longer as much incentive for married couples to wait until full retirement age — currently age 66 — to claim their benefits. The thousands of dollars that these couples will no longer be eligible to receive could be enough to push the balance toward claiming earlier rather than waiting, especially if some of the other factors above would ordinarily lead them to take benefits at 62.

When to claim Social Security is a tough decision that involves plenty of variables. But even though many financial planners urge their clients to think twice before claiming benefits at the earliest possible age, there are situations where it makes more sense to go ahead and take Social Security at 62 rather than waiting.

Financial advisors need to know this and be prepared to warn clients about the issue. Tax planning affects when a person should take Social Security Retirement benefits and when benefits should be delayed and that money instead taken from an investment portfolio.

In most situations, a retiree is better off delaying receiving Social Security benefits until he or she is 70 years old because benefits grow by about 8 percent a year until the recipient reaches 70.

In addition, with the current high market value, taking withdrawals from a portfolio now will not deplete the portfolio as much as they would if the market makes a correction. When a retiree hits 70.5 years of age, a minimum distribution amount is required to be taken from an IRA or 401(k). If some money has already been withdrawn before the person reaches 70.5, the required minimum distribution will be less and the tax burden decreased accordingly.

Each client’s situation is different. The tax implications must be determined for each retiree. But advisors may want to help their clients build an income bridge so Social Security Retirement benefits can be delayed until they reach their maximum.

Oldest Boomers Face Big Birthday

The oldest Baby Boomers are facing a big birthday this year as they turn 70, which brings with it some forced financial decisions.

The oldest boomers will have to start taking required minimum distributions (RMDs) from their qualified retirement accounts and those who have delayed receiving their Social Security benefits will start receiving that money.

Ideally, the oldest baby boomers began talking with their financial advisors and planning for retirement a decade ago, says Bill Van Sant, senior vice president at Girard Partners Ltd., a Univest Wealth Management company in King of Prussia, Pa.

“This is an important birthday. Those turning 70.5 years old can take their RMD the next year but we advise them to take it the year they turn 70.5 or they will have to take two in the following year, which could push them into a higher tax bracket for that one year,” Van Sant says.

The RMD for retirement plans is determined by a formula based on the value of the assets in the plan. In most cases, the money was not taxed when it was contributed, so it is taxed as it is taken out.

If an annual withdrawal is missed, the penalty is a stiff one, says Mike Piershale, president of Piershale Financial Group in Crystal Lake, Ill. Piershale had a client who was unaware of the required withdrawal, which in her case turned out to be $16,000 for the first year.

“She would have been penalized $8,000 or 50 percent because no one had told her she was required to take money out of her tax qualified plan. We managed to get the money back for her by explaining to the IRS that it was a mistake on her part that first year,” Piershale says.

Withdrawals are required from traditional IRAs and also from company 401(k) plans, if the person is no longer working for the company.

“We make sure we remind our clients of the required withdrawals before they turn 70,” says Piershale.

Ellen Jordan, senior vice president at Bryn Mawr Trust, a wealth management firm in Bryn Mawr, Pa., notes that baby boomers are the first generation that has saved in tax deferred accounts because companies phased out pensions.

“Now they have to start spending what they accumulated and the big scare is that they will not have enough money for the rest of their lives,” Jordan says. “Depending on their health, they may want to continue working.”

Jordan says Bryn Mawr sometimes advises clients to start taking distributions from tax-deferred accounts gradually before they turn 70.5 so they are not pushed into a higher tax bracket when they begin required withdrawals.

Advisors also need to remind clients that Social Security benefits can be taxed. For an individual, 50 percent of Social Security benefit is subject to federal income tax if the income is above $25,000 and 85 percent is taxed if the income exceeds $34,000, according to the Social Security Administration. The limits for couples are $32,000 and $44,000, respectively.

This year presents another deadline as well, advisors are reminding their clients. The Social Security Administration is phasing out the strategy known as file and suspend. Under this strategy, one spouse is able to file and suspend his benefits to allow the other person to collect spousal benefits. This allows the first spouse’s benefits to grow until age 70.

The SSA has given couples until the end of April to file for this benefit, after which it will no longer be available.

(In part Based on Articles By Karen DeMasters)

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Honorably Discharged Navy Veteran Defrauded VA and SSA of $1.5 Million

‘Wheelchair-Bound’ Man Caught in Disability Fraud After Seen Jet Skiing, Riding Motorcycle. He conned the VA and the SSA out of millions of dollars.

/ AP

/ AP

A South Carolina man was convicted of “one of the largest” disability fraud cases in Veterans Affairs history after he was caught riding a motorcycle and going jet skiing while pretending to be wheelchair-bound.

Dennis Paulsen faces up to 20 years in prison for conning the VA and Social Security Administration (SSA) out of millions of dollars, taking nearly $10,000 a month for more than a decade.

Mr. Paulsen obtained the benefits by pretending he was unable to use his feet or hands due to a multiple sclerosis diagnosis (MS). Meanwhile, he regularly hit the gym, joined a club baseball team, played golf, and drove around in his Escalade.

“In conducting one of the largest fraudulent single disability compensation claims in VA history, Paulsen substantially feigned and exaggerated the impairment resulting from his multiple sclerosis (MS) diagnosis,” the Social Security Administration’s(SSA) Inspector General(IG) said. “After being diagnosed and discharged from the Navy in the early 1990s, Paulsen began receiving a monthly VA benefit as a result of his diagnosis. Unsatisfied with the amount he was receiving, Paulsen began a pattern of malingering by claiming his MS rendered him unable to use his hands or feet in any respect.”

“Still unhappy with the money he was awarded, Paulsen ramped up his claims, lying to his doctors, presenting himself as house- and wheelchair-bound, and making false claims that he required daily professional medical care to live until his benefits were increased to the maximum disability payments available to a Veteran,” the inspector general said.

In all, Paulsen was able to steal $1.5 million from the government, collecting $9,400 each month.

The case is reminiscent of the case of a “blind” Wisconsin man whose Social Security disability fraud scheme ended when federal agents caught him driving a speedboat. Paulsen was caught driving a motorcycle.

“Despite his feigned claims of impairments and presenting himself in a wheelchair to his doctors, Paulsen lived in a non-handicap-accessible residence and was able to ride his motorcycle and jet skis plus play baseball and golf on a regular basis,” the inspector general said. “In 1999, Paulsen met his ex-wife at the gym where he exercised and worked training others.”

Paulsen was also “active in several gyms, joined a baseball league from 2006 until 2014,” and seen “playing pool, swimming in his backyard pool, playing on the beach, and driving his Escalade and manual shift Mini Cooper.” He even participated in a Marine Mud Run.

Investigators used surveillance footage and family photographs to reveal Paulsen’s very active lifestyle, contradicting his claim of suffering from a severe disability.

Paulsen continues to exaggerate his condition, appearing at his trial in federal court, which concluded last week, in a wheelchair.

Paulsen testified, in a wheelchair, for four hours and called three doctors as expert witnesses in an attempt to support his claim that he was and had been totally disabled,” the inspector general said. “The guilty verdict reflects that the jury did not find this testimony credible.”

 

(BY:
January 27, 2016)

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Mentally Impaired Social Security Claimants Commit Suicide After Being Told That Benefits Will End

Lawsuit blames two suicides on notice of imminent cut in disability benefits.

 A move by the Social Security Administration (SSA) to end disability checks for thousands of people in Kentucky played a substantial role in two people killing themselves, a federal lawsuit alleges.

 

The two dead claimants committed suicide by gunshot. They blew out their brains. Melissa Jude and Leroy Burchett, were despondent after getting notice that they would lose benefits, the lawsuit alleges.

Burchett shot himself in the chin on June 1. Jude shot herself in the head the next day, according to the lawsuit.

The lawsuit further alleges that two Social Security recipients were distraught over the notice from SSA that they would lose their livelihood and might have to repay pass benefits received.

Social Security has notified thousands of benefit recipients of the impending loss of checks.

This case is linked to allegations of fraud in disability cases of Kentucky lawyer Eric Conn.

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Thousands Afraid To Appear At Social Security Hearings

Attorneys worry 1,000 or more Social Security beneficiaries will lose checks when re-evaluated.

Attorneys representing hundreds of people fighting to keep their Social Security federal disability benefits worry those benefits may disappear for most of them if they do not have a lawyer.

Each year, the Social Security Administration (SSA) orders thousands of  people to attend Re-Evaluation hearings to determine whether they should continue receiving disability checks.

Many of those people are former clients of  Attorney Eric C. Conn.

In 2011 a story appeared in the Wall Street Journal concerning the high rate in which SSA Judges approved Social Security disability cases.

Allegations of fraud came under investigation by a U.S. Senate committee Sen. Tom Coburn, R-Okla., was the Chairman of The Senate Committee. The Committee’s Report found widespread fraud and a veritable “disability claim factory” allegedly  run by Attorney Eric C. Conn out of his small office in Stanville, Kentucky, a region of the country where 10 to 15 percent of the population  receives disability payments.

The report documents how Attorney Conn allegedly worked together with Social Security Administrative Law Judge David Daugherty (ALJ)  and a team of favored doctors with checkered pasts, including suspended licenses in other states, who rubber stamped approval of disability claims. In most cases, the claims had been prepared in advance with nearly identical language by staffers in Conn’s law office.

The report found that over the past six years, Attorney Conn allegedly paid five doctors almost $2 million to provide favorable disability opinions for his claimants.

In 2010, the last year for which records are available, Judge Daugherty approved 1375 disability cases prepared by Attorney Conn’s office and denied only 4 of them – an approval  rate that other administrative law judges have described as nearly  impossible.

Judge Daugherty, 78 years old, processed more cases than all but three judges in the U.S. He had a wry view of his less-generous peers. “Some of these judges act like it’s their own damn money we’re giving away,” ALJ Daugherty told a fellow Huntington SSA ALJ, Algernon Tinsley, who worked in the same office, Mr. Tinsley recalled.

The report found, “Judge Daugherty telephoned the Conn law firm each month and identified a list of Mr. Conn’s disability claimants to whom the judge planned to award benefits. Judge Daugherty also indicated, for each listed claimant, whether he needed a “physical” or “mental” opinion from a medical professional indicating the claimant was disabled.”

The report says that when Senate staffers and the Social Security Administration’s Office of the Inspector General began an investigation based on tips from whistle blowers in the Social Security Hearing Office, Attorney Conn and Judge Daugherty began communicating with disposable, pre-paid cell phones. It also alleges they contracted with a local shredding company to destroy 13 tons of documents.

Attorney Conn also allegedly destroyed all the computer hard drives in his office, a la Hillary Clinton at the State Department.

In 2011, the SSA placed Daugherty on administrative leave. He retired shortly after that.

In October 2013 a West Virginia Police Report said Judge Daugherty was found unconscious in his car in a Barboursville, WVa. church parking lot.

The report said the police found a garden hose running from the car’s exhaust into the passenger side of the vehicle.

Judge Daugherty was taken to a hospital and later released.

Conn has not been charged with a crime. He is suspected by congressional investigators of using fraudulent information to win the benefits. Attorney Conn’s legal fate remains in the hands of the Obama Justice Department.

A prevailing concern is that disability recipients who do not hire an attorney to represent them at their re-determination hearings will lose their benefits.

Unrepresented Claimants should not go through one of these complicated re-determination hearings without a lawyer. People appearing before SSA Administrative Law Judges (ALJ) can get a free lawyer on a contingent fee basis. The attorney does not get paid unless the client wins the case.  That amounts to a free lawyer.

Many disability recipients do not hire legal representation for their hearings. They stand a good chance of losing their benefits.

Even some who were represented at Re-Determination Hearings  are still anxious to hear results.

“Not knowing … that’s been the worst thing is not knowing and trying to prepare in case you do lose your benefits,” one beneficiary said.

One attorney who specializes in representing Social Security Claimants has said in recent weeks several people have told him they’ve thought about killing themselves if they lose their benefits.

The suicide chatter is way up,” the Attorney said. “It was especially bad around Christmas. Unfortunately people have got this unfortunate response that suicide is somehow a rational response to losing their benefits”, the attorney said.

Family members of two people who killed themselves in 2015 are suing the Social Security Administration, because they believe that the Social Security Administration’s decision to terminate disability benefit checks was the reason they committed suicide. The families of of John Daniel Jude and Emma Burchett are convinced that the termination of their SSA benefits played a substantial role in their deaths.

Attorneys for John Daniel Jude and Emma Burchett filed a lawsuit in U.S. District Court in Pikeville, KY.

The lawsuit alleges Burchett’s husband, Leroy Burchett, and Jude’s wife, Melissa Jude, killed themselves in June after getting notice that their benefits would be suspended.

More than 1,000 former clients of Attorney Eric Conn received the same letter after Attorney Conn was accused of colluding with  Social Security Administrative Law Judge David Daugherty to rig Social Security cases.

These are desperate times for many people in America who were once considered among the Middle Class. They have seen their living standards decline and are struggling to make ends meet. Many were laid off in the last eight years and have not been able to find new jobs. They are not counted in the Unemployment Statistics because they have dropped out of the labor pool. Many are between the ages of 50 and 65 and do not yet qualify for Social Security Retirement Benefits. They have not even reached the age when they would be eligible to apply for early retirement. For many Baby Boomers that is around age 62.

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