Social Security paid out $2 billion in bogus disability claims approved by 44 administrative law judges over the last seven years, the agency’s internal auditor said in a report Friday that details some of the problems with fraud in the troubled disability program.
The 44 — who are about 4 percent of the total of ALJs, as they are known — were targeted because they heard a high number of cases and approved most of the ones they heard, leading some lawmakers on Capitol Hill to conclude they were either rubber-standing them or else not delving deeply enough into the details of the claims.
Out of 275 sample cases, the agency’s inspector general said 216 were questionable on their face, and determined that five should have been outright rejected, seven were overly generous, one was too stingy and half of them should never have been completed without getting more information.
All told, only 40 percent of the cases were decided properly, the investigators said.
“We estimate these ALJs improperly allowed disability benefits on approximately 24,900 cases, resulting in questionable cost of approximately $2 billion,” the investigators said.
In one sign of good news, the investigators said the number of judges who met their criteria for “outliers” — meaning they reviewed a large number of cases and approved at least 85 percent of the ones they reviewed — has dropped. The inspector general said that coincides with the Social Security Administration doing more scrutiny of ALJs following reports of egregious behavior.
In one instance from West Virginia, an ALJ approved 99.7 percent of his cases from 2005 through 2011, awarding disability benefits to 8,413 people — the equivalent of $2.5 billion in total lifetime benefits.
Major disability fraud cases have been reported in West Virginia, Puerto Rico and most recently in New York City, where investigators said police officers falsely claimed disability from the Sept. 11, 2001, terrorist attacks. Some of those officers were exposed in part because they posted photos online of themselves fishing or riding Jet Skis, suggesting they were able-bodied enough to work.
The fraud has irked members of both parties on Capitol Hill, and they have demanded changes.
“Every dollar misspent or wrongly awarded depletes resources for those who are truly in need,” said Sen. Orrin G. Hatch, Utah Republican. “Taxpayers and the disabled deserve better.”
Social Security is made up of two trust funds — one for the elderly and another for the disabled. That disability fund is slated to go bankrupt in 2016, at which point it will have to cut benefits, unless Congress changes the law.
The inspector general said 32 ALJs met their red flag criteria in 2009, which was the worst of the last seven years. By 2013, just seven ALJs had decided so many cases so favorably — but of those seven, six are still on the job.
Social Security officials say they’ve made progress in improving the disability program, including working to reduce what they called an “unconscionable” backlog that left some applicants waiting years for a disability hearing.
Officials also testified to Congress that they are seeing fewer bad decisions out of ALJs.
But they said their hands are tied in trying to punish ALJs they believe are a problem, since the law won’t let them be fired without going through a lengthy personnel board process.
That is by design, to ensure no political pressure to alter decisions, the agency said.
“It’s important to understand that ALJs have qualified decisional independence which allows them to issue decisions consistent with the law and agency policy, rather than decisions influenced by pressure to reach a particular result,” said Social Security spokeswoman LaVenia J. LaVelle. “The primary purpose for the ALJs qualified decisional independence is to enhance public confidence in the essential fairness of an agency’s decision-making process.”
• Stephen Dinan can be reached at sdinan@washingtontimes.com.
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