The Social Security Administration has been working for years to reduce its backlog of disability claims, which now stands at 780,000 claims. It even hired and trained 8,600 new employees last fiscal year.

But any progress it made has come to an abrupt halt. Largely because of the recession, Americans filed 400,000 more disability claims than predicted last year and the agency expects 700,000 more to be filed this year than in 2008.

SSA is not alone. Agencies across government that provide federal assistance are seeing their workloads explode as Americans seek unemployment insurance payments, health care insurance, school lunches, food stamps and college loans. Benefit claims and payouts have jumped in the last year at assistance programs run by the Labor, Veterans Affairs, Agriculture, Education, and Health and Human Services departments, among others. See article here:

More than 50 million people each received payments of $250 last May. The administration expects that approximately 57 million would get $250 in 2010. Of those, 49 million would be Social Security beneficiaries. The rest of the recipients would be veterans, railroad retirement beneficiaries, disability beneficiaries, those on Supplemental Security Income and public-employee retirees not eligible for those programs. See full story here:

THe Associated Press reports that big job losses and a spike in early retirement claims from laid-off seniors will force Social Security to pay out more in benefits than it collects in taxes the next two years, the first time that’s happened since the 1980s.

The deficits — $10 billion in 2010 and $9 billion in 2011 — won’t affect payments to retirees because Social Security has accumulated surpluses from previous years totaling $2.5 trillion. But they will add to the overall federal deficit.

Applications for retirement benefits are 23 percent higher than last year, while disability claims have risen by about 20 percent. Social Security officials had expected applications to increase from the growing number of baby boomers reaching retirement, but they didn’t expect the increase to be so large.

What happened? The recession hit and many older workers suddenly found themselves laid off with no place to turn but Social Security. See article detail here:

A nationwide surge in Social Security disability claims has hit Michigan disproportionately hard.

The flood has caused a case logjam at the state’s five Social Security hearing offices, which have some of the longest wait times in the nation: nearly two years.

The delay in benefits approval, experts say, can mean a slow slide into poverty, with laid-off workers eating up their savings or even losing their homes. Older workers with health problems are increasingly turning to disability to stay afloat after losing their jobs because they are often less likely to find new employment, experts say. See story here:

On the eve of the 74th anniversary of Social Security, nearly nine in ten
(88%) Americans say Social Security is more important than ever as a
result of today’s economic crisis. Three-quarters of Americans say it is
critical to preserve Social Security even if it means that working
Americans have to pay higher taxes to do so, according to a poll
sponsored jointly by the National Academy of Social Insurance (NASI)
and the Rockefeller Foundation.

The poll of 1,488 Americans, conducted between July 7-14 by the
Benenson Strategy Group, sends a strong message to policymakers
about the value that Americans place on Social Security benefits for
themselves and the country as a whole – with over 75 percent of
Americans saying that Social Security is or will be an important part of
their retirement and nearly half of recipients stating that they would be
unable to afford food, clothing or housing without it.

“The recession underscores the critical role Social Security fills for
working families and retirees across the nation,” said Kenneth S. Apfel,
Chair of the NASI Board of Directors and Commissioner of Social
Security from 1997 to 2001. “On the eve of the 74th anniversary of the
signing of the Social Security Act, it is striking to see how deeply
Americans value the program, they want to preserve and improve it,
and they are willing to pay for it.” See full survey report here

TIme Magazine reports today that Social Security officials expect an even larger spike in new disability claims than before, as aging, injured baby boomers tumble out of the work force and need income.

This is not good news, as the system was already bogged down at several points, and has been the target of unfavorable media reports documenting unconscionable waits for decisions on benefits.

Time’s article says that Social Security estimates they’ll receive 3.3 million new disability claims over the next year, up from their previous estimate of 3 million projected just five months ago.

The wave of new applications comes just as officials were making progress in curbing a massive backlog of disability appeals cases, which has plagued the agency for years. Also adding to the problem are recent moves in at least 10 states to furlough hundreds of employees that process initial benefit claims.See full Time article here:

Today’s Wall Street Journal has a thoughtful article on the travails of obtaining disability payments from Social Security, specifically about how people underestimate the difficulty of the process. We frequently find clients who express amazement at this: they have always assumed these benefits they have paid for will be readily available in time of need.

“Workers who contribute part of their earnings to Social Security often underestimate what it takes to tap the benefits if they become permanently disabled. The process can be tricky and more time-consuming than people expect, and the weak economy appears to be contributing to a surge in applications.

“Applications for Social Security disability benefits rose more than 17% in the first quarter. There are 7.4 million people receiving disability benefits that average $1,063 a month.

“Those numbers are expected to rise as baby boomers age, so it can pay to know the claims process. Here are seven common errors to avoid:

First, Misdefining disability

Many people erroneously think they can collect benefits as long as they are unable to do their regular job. A person must be unable to perform any substantial work and have a medical condition that has lasted or is expected to last at least a year or to result in death. It’s not only what you can do or have been doing but anything they think you’re suited for. Others include wating too long to apply,being disorganized, failing to get help, making financial errors. Read full article here:

While Social Security predicts a substantial reduction in waits for hearings by 2012, many claimants need a more immediate fix. This article discusses the reasons and some remedies for hearing delays:

“Many people are denied disability benefits at the first two levels (Application for benefits and Request for Reconsideration). The third step in the process is the Request for Hearing before an Administrative Law Judge. At this stage, most claims have the greatest chance of being approved. The problem is that the greatest delays occur at this level.
The Administration has been confronted by a significant backlog on
cases pending decision and dispositions.
In FY 2007, SSA’s National Hearings Average Processing Time was 512
days for all dispositions. (see
www.ssa.gov for a thorough
discussions of the “whys and wherefores”…)

See entire article here.

Charles Hall’s blog today nicely supplies graphics for the delays at the Social Security Hearing office, by city. These were orginally published in the newsletter of NOSSCR (National Organization of Social Security Claimants’ Representatives) The worst is well over 600 days wait, the “best” hearing office has a wait of 200+ days. (Click on the images in Mr. Halls blog to enlarge.)

Not much progress has been made in spite of a variety of measures to speed up service delivery – claims are simply coming in faster than they are being resolved. Overall, between January 1007 and April 2009, the average wait for a hearing has just been reduced from 508 to 505 days. Keep in mind that this wait is AFTER denials on initial and reconsideration aspects of the claim, which can take more than a year.

Compare the average processing time as it has changed over time:

January 25, 2007 — 508 days
May 25, 2007 — 523 days
July 28, 2007 — 528 days
August 31, 2007 — 523 days
November 30, 2007 — 500 days
February 29, 2008 — 511 days
May 30, 2008 — 523 days
June 27, 2008 — 529 days
July 31, 2008 — 530 days
September 3, 2008 — 532 days
November 5, 2008 — 476 days
December 3, 2008 — 480 days
March 8, 2009 — 499 days
April 24, 2009 — 505 days

See Mr. Hall’s blog for the list of cities and their respective waiting times:

Over the past year, the newspaper The Oregonian, Portland and Oregon’s local paper, has been running a series carefully documenting the devastating delays at the Social Security hearing offices, putting a human face on this non-comedy of errors and underfunding. Brent Walth and Bryan Denson of The Oregonian have just won the prestigious Bruce Baer Award for Investigative Reporting, for uncovering the enormous backlog of disability claims in the Social Security system. The articles showed that while claims management is a nationwide problem, Social Security Administration’s Portland office has one of the slowest case-completion rates in the country. The reporters found several cases in which claimants died while waiting for a benefits determination from the office: On average, it takes nearly two years for the Portland office to handle the appeal of a case.