Are your needed disability benefits about to end?
2016 was supposed to be a bad year for those on disability. Every year, the Social Security Administration publishes a trustee’s report on the status of the Social Security system. In 2015, the trustee’s report opened with an urgent emphasis on the lack of funding for Social Security’s disability program.
There was simply not enough money in the program to make the promised pay outs for this year.
11 million beneficiaries would have gone from an average $1,165/month benefit to $944/month benefit. This means 11 million Americans would have gone from slightly above the federal poverty line of $981/month to slightly below it.
Fortunately, the fund did not run out of money.
Today, disability beneficiaries are still receiving full benefits. What happened? How was this disaster avoided? Simple, congress just took the money from somewhere else as it has done repeatedly in the past.
Social Security comes out of a trust fund titled the Old-Age, Survivors, and Disability Insurance Trust Fund or OASDI.
This fund is further broken into two separate accounts- Disability Insurance (DI) and Old-Age and Survivors Insurance (OASI). Disability benefits come out of the disability fund and retirement benefits come out of the OASI fund. Congress often shuffles money between the funds or siphons in money from a separate fund in order to keep the system running. This new budget deal transfers $150 billion from the retirement fund to the disability fund over the course of three years.
The new legislation is titled “Social Security Benefit Protection and Opportunity Act of 2015” and outlines several new measures to help reduce expenses. Some of the changes include:
Tighter regulations on who can present medical evidence.
If someone has committed felony Social Security fraud, been excluded from Federal health care due to fraud, or has been fined for submitting false evidence, any future evidence they provide will not be considered.
Penalties for conspiracy to commit fraud.
This means that you do not actually have to commit fraud, simply planning to defraud Social Security is against the law. Conspiracy to commit Social Security fraud could lead to five years in prison, a fine of up to $250,000 or both.
Harsher penalties for fraud by non-beneficiaries.
Non-beneficiaries who abuse the system for personal gain can now face up to 10 years in prison, double the old penalty of 5 years. This includes doctors who fake records, attorneys who present superfluous claims, or Social Security employees who make decisions in a way to benefit themselves.
Professionals must perform medical exams.
Previously 20 states allowed medical examinations to be performed by people who were not health care experts. The new law requires medical examinations to be performed by medical experts.
Returning to work more appealing for retirees.
A person on retirement benefits can earn up to $15,720 (as of 2016) without any reduction in benefits. Then, for every $2 earned, benefits are reduced by $1. It is important to note that this does not apply to the disabled- if you make more than the Substantial Gainful Activity limit ($1,130 in 2016), you will no longer be considered disabled.
In the long term, these changes won’t save the disability program, and may even increase expenses.
It is estimated that the fund will be in danger of running out again in 2034. Most of these reforms focus on reducing fraud. While Social Security fraud is definitely a hot-button issue, the truth is fraud rarely occurs. As often as you may see media stories about people faking diseases to collect benefits, the Social Security Administration estimates its rate of fraud is less than 1 percent. It’s true there are a few people on benefits who don’t deserve them. On the other hand, there are over 24 million Americans with a severe disability and even the highest estimates suggest only 14 million Americans collect disability insurance. Clearly, a more long-term strategy is needed to not only preserve benefits for those who are currently using them, but to expand benefits to all those that need them.
If you are unable to work because of an injury or illness, you may be entitled to benefits. The attorneys at Bemis, Roach and Reed have experience with disability cases and can help you win the benefits you are entitled to. Contact us today for a free consultation. Call 512-454-4000 and get help NOW.
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