Friday, March 29, 2013

that TAL disability piece

i listened to this week's TAL, "trends with benefits", and the companion planet money podcast. as it happens i am well aware of the social security disability/SSI world, as my first job out of law school was doing the very work criticized in the TAL piece. i hated that job, i was there for less than one year, and i still celebrate z- liberation day each year on the anniversary of the day i quit.  while i don't necessarily endorse all of MMA's beefs with the piece, i do have some problems with it.

in act one of the TAL episode, chana joffe-walt notes that the doctor evaluating SSI/SSDI applicants about their level of education. she notes that's not a medical question (which is true) but then goes on to say that it has nothing to do with whether someone is "disabled." we then hear the doctor defend his question by noting that he is trying to determine if they are able to perform "gainful employment."

the piece makes it seem like the doctor is overstepping his bounds by getting into whether there are  jobs that the patient is able to do rather than just the narrow question about an individual's medical limitations. but actually that is the legal standard that governs the social security administration's decision whether to find someone disabled. the statute defines the standard to be whether the applicant can be expected to perform any "substantial gainful activity" available in the local economy. that's right, that doctor's comment that joffe-walt presented as going beyond what should be relevant for a disability claim was actually echoing the legal definition of what qualifies a person for disability benefits under the law. in applying that standard, stuff like education is legally relevant.

it also bugged me when joffe-walt presented how social security lawyers get paid. she accurately noted that the lawyers receive a percentage (up to 25%) of the applicants backpay award if they are successful. but for some reason, she presented it as odd that the attorney's fee is paid directly to the attorney from the social security administration rather than to the claimant and then having the claimant pass on the fee amount to the lawyer. the two are really equivalent, except that having an direct payment is easier and avoids legal disputes between lawyers and clients.

but what really bothered me were several other things that joffe-walt did not mention about the fee arrangement: (a) the 25% cap on legal fees is set by law and is substantially lower than the standard contingent fee percentage in most other kinds of cases, which usually run between 30 and 40%, (b) direct payment from the social security administration is only permitted if the client pre-authorizes that arrangement in writing, and (c) in many contingent fee cases, it is not unusual for the losing side to issue two checks, one to the attorney and one to the claimant. the direct payment arrangement that joffe-walt described in social security cases is not extraordinary as she describes. it actually works pretty much like it does in an auto accident case, where the insurance carrier will often cut a portion of the settlement check to the lawyer and another portion to the injured party.

that being said, the main thrust of the reports are correct: it's not good policy to use this disability program as a de facto way to support displaced workers who no longer are able to get jobs in a changed economy. and yet, i'm still concerned by the potential political impact of the piece.

in a perfect world, the reaction to the piece would be a constructive debate about how to help displaced workers and come up with a program that suits them so they don't have to shoe-horn themselves into the disability program to survive. but this isn't a perfect world. if the piece generates political waves, we all know it will be to cut back on the disability program to prevent its misuse without doing anything to help the displaced worker who might be thrown off the disability system because of the reforms. for that reason (like yglesias), i would rather we just leave the disability program alone. it is a bad vehicle for helping people who are displaced by our economy, but it's one of the only vehicles available. in the current climate there's virtually no chance that the government will create something else to help them.