By Scott B. Elkind, Esq.

As of late, the Social Security Administration (SSA) has been embattled due to a serious of serious accusations.

First and foremost is the unprecedented rise in disability applications which has the disability benefits system facing insolvency by 2017. Although SSA could not have anticipated a 50% increase in applications from a decade ago, it was very aware that the aging baby boomer generation would be applying in record numbers during this time period. What was not anticipated was a slowed economy, forcing many workers out of their jobs. Many of these workers enjoyed accommodated positions as a result of long tenure in their past positions. Unfortunately, new employers are not as tolerant of employees who need special treatment when younger, healthier (and lower compensated) employees can be obtained readily. This situation has left these older, sick employees with no alternative but to file for disability benefits.

It remains to be seen how Congress will address this problem as Social Security has traditionally been viewed as the “third rail” of American politics. In the end, Congress must act to either (1) add new restrictions so as to limit the amount of disability cases approved; or (2) approve increased funding to cover the projected shortfall in benefits to be paid. If new funding is not approved, the political backlash could prove harmful. To deny disabled people their disability not only undermines their expectations, but also will put a burden on the social welfare systems of the separate states. To increase funding creates the problem of cutting other government programs or increasing revenue (taxes). Either way, this will be a political hot potato worthy of great debate, consternation, and posturing by our elected officials.

SSA has also taken issue with a recent Transactional Records Access Clearinghouse analysis undertaken by Syracuse University. This report revealed that there are significant disparities between administrative law judges in making disability decisions. The Social Security Commissioner, Michael Astrue, stated that “outliers” in the survey were the reason for this finding. This controversy has been further magnified by the possible prosecution of a West Virginia Administrative Law Judge for approving too many disability cases, resulting in a Congressional hearing on the subject (although judges approving minuscule numbers of disability cases have not been similarly investigated). The Syracuse report also noted a significant increase in pending appeals, jumping up to nearly 741,000 as of 3/31/11. Commissioner Astrue pointed to his achievement in shortening waiting times for hearings as the means for resolving this enormous backlog of cases, stating that SSA is not “faltering.”

These controversies will not go away anytime soon as the claims are inundating SSA who is faced with a continued exiting of older, experienced employees from its ranks and unresolved budgeting dilemmas.