Claims for Social Security and disability benefits have grown in recent years, the result of baby boomer retirements and high unemployment. The Social Security Administration received 10 million new claims in 2009, up from about 8.2 million in 2004.
With 65 percent of new disability claims initially denied, appeals began piling up, and administrative law judges who hear these cases were overwhelmed.
By August 2008, an appeal took an average of 532 days to resolve. The agency hired judges and support staff to speed up the process, and by last year the average appeal took 390 days. There was still a backlog of 705,370 pending hearings.
But progress has been undermined by the budget impasse affecting most federal agencies, according to a report by the Congressional Research Service. Without a budget for the current fiscal year, the Social Security staff has had to cut short its efforts to improve efficiency.
“Extended continuing resolutions that largely fund the agency at previous year levels, appropriations below the president’s budget request” and cuts proposed by House Republicans “may make [the goal of reducing the claims backlog] difficult to attain,” says the CRS report, which was released last week.
The report also says that President Obama’s budget requests for the Social Security Administration in recent years have not covered the increases in claims and backlog in appeals.
The agency would have received $12.4 billion in the current fiscal year, but it has operated at last year’s budget level of $11.4 billion for six months. Stimulus funding added $350 million in 2010, but under the stopgap measure funding the government through April 9, it lost $200 million from a pot aimed at addressing the claims backlog.
The cuts will delay claims from being processed for about 700,000 people, according to an estimate compiled by Democratic House lawmakers.
In response, the Social Security agency has suspended efforts to open eight planned hearing offices to process claims in Alabama, Minnesota, Indiana, Michigan, Texas, Montana, California and New York, spokesman Mark Lassiter said. Overtime has been largely eliminated, and a hiring freeze has blocked new staff to process appeals.
The extended stopgap measures have “made it much more difficult” for the agency to reduce the backlog in disability claims, he said.
“We have many high-traffic offices where all day long, our employees interview people filing for benefits,” said Witold Skwierczynski, president of the union representing local Social Security field offices. “Then they have to process a case. That takes time.”
The agency pays out more than $800 billion in benefits every year to retirees, their spouses, dependents and survivors, low-income disabled adults and children, and some low-income World War II veterans.