[Congressional Record Volume 140, Number 11 (Tuesday, February 8, 1994)]
[House]
[Page H]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]
[Congressional Record: February 8, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]
LET'S STOP DISABILITY INSURANCE FRAUD
(Mr. SMITH of Michigan asked and was given permission to address the
House for one minute and to revise and extend his remarks.)
Mr. SMITH of Michigan. Mr. Speaker, Supplemental Security Income was
designed to help the disabled who can no longer work and sustain their
incomes. Unfortunately, some people have found that a court
interpretation of a 1972 law allows them to take billions of dollars
from U.S. taxpayers by having their children classified as disabled
because they are slow learners or have behavioral problems. Several
constituents brought this unfair situation to my attention. Over the
last several months, I drafted a bill to stop this fraud by eliminating
extra disability benefits for those under 16 years old, saving
taxpayers $3.6 billion per year. Parents of these children would still
be eligible for medical care through Medicaid, AFDC and other low
income assistance programs, but they couldn't claim disability benefits
of an additional $400 per child per month. I plan to introduce
legislation this week and invite cosponsors.
{time} 1430
The problem of disability abuse has come increasingly into the public
spotlight, including this article in last Friday's Washington Post by
Bob Woodward and Benjamin Weiser, that I will include as an extension
of my remarks.
My bill will protect the integrity of S.S.I. and save billions of
dollars for hard working taxpayers.
The article referred to follows:
[From the Washington Post, Feb. 4, 1994]
Costs Soar for Children's Disability Program: How 26 Words Cost the
Taxpayers Billions in New Entitlement Payments
(By Bob Woodward and Benjamin Weiser)
Nora Cooke Porter, a pediatrician and lawyer, works on the
front lines of the nation's entitlement system. She can
barely contain her frustration as she flips through some of
the thousands of applications for a federal aid program for
disabled poor children that have passed through her
Harrisburg, Pa., office over the last two years.
The files show, she says, that children who curse teachers,
fight with classmates, perform poorly in school or display
characteristics of routine rebellion are often diagnosed with
behavioral disorders and therefore qualify for the program's
cash benefits, which average $400 a month. Under a broad new
federal standard prompted by a 1990 Supreme Court ruling,
behavior that isn't ``age appropriate'' is considered a
disability.
Porter feels her hands are tied by the new rules. She has
tried to block benefits to children who, in her medical
opinion, are not suffering from any disability. Her superiors
have overruled her, and she has written detailed rebuttals.
Last month, she was suspended without pay for her repeated
protests, and she believes her job as a disability-review
physician is in jeopardy.
Months before her suspension, she agreed to be interviewed
because she believes that the children's disability program
is an example of an entitlement system gone haywire. She
hopes that her decision to speak out will drawn attention
from congressional or federal investigators.
The age-appropriate standard is only the most recent flaw
in the program, according to Porter and others. They trace
the programs' problems to its origin: a vague, little-debated
26-word clause that was hastily inserted in a mammoth welfare
bill passed in 1972.
Porter's criticisms are echoed by many others who work in
the program. They say they sympathize with the children, many
of whom are living in desperate poverty. But, they argue, the
program does little to help them with their real troubles,
especially since the majority of Children who now qualify
have mental disorders rather than physical ones.
How to provide for the country's neediest--the old, the
young, the poor, the sick, the disabled, the disadvantaged--
without bankrupting the Treasury has become one of the
central governing questions of our time.
Earlier this week, The Washington Post published a series
of articles on the rising cost of Medicaid, the health
insurance program that is the government's largest
entitlement for the poor. This article examines the little-
known children's disability program, another entitlement for
the poor, which is experiencing the same skyrocketing costs
as Medicaid.
Last year, the children's disability program cost $3.6
billion. It was serving 770,000 at the end of December, a
number that none of its sponsors imagined possible when it
was enacted 20 years ago, they say. Because disability
recipients automatically qualify for Medicaid, the program's
rapid expansion also has led to hundreds of millions of
dollars in additional costs for that entitlement program.
Children's disability is a component of a larger
entitlement program call Supplemental Security Income, or
SSI, which provides benefits to poor people who are elderly,
disabled or blind. By law, entitlement programs guarantee
government benefits to anyone who meets the qualifications
set out in legislation or in regulations. Federal spending
levels are mandatory, meaning they cannot be altered unless
the law is changed.
what can happen
The history of the children's disability program
illustrates what can happen when a law is enacted without
much debate or study and then becomes subject to
interpretation by regulators, advocates and the Supreme
Court.
The new age-appropriate standard that Porter criticizes was
written by federal regulators after the Supreme Court ruled
that the law required the government to use a broader
definition of disability in determining eligibility.
Since the court ruling, the number of children receiving
benefits has more than doubled. The decision also led to
lump-sum back payments for some 150,000 children who had been
denied benefits under the old rules. These back payments--
which averaged $15,000, with some as high as $75,000--have
cost the government $2 billion since 1991, plus at least
$287 million more in administration.
In a survey of state disability determination directors
conducted last summer, more than half cited ``inappropriate
use of SSI funding'' as the most common concern in their
states. Parents or guardians are not required to use the
money for therapeutic or medical aid. They can spend the cash
payment as they please, as long as it benefits the child in
some way. That rule has been interpreted to allow the
purchase of a television set, a video game or a car.
``I really have to grapple with the idea that I'm allowing
that parent to use the money any way they want to, fairly
certain, given the history, that the child is not going to
benefit,'' said a psychologist in the Washington disability
determination office. ``And that happens to us . . . eight
times a day.''
The lump-sum payments revealed what both supporters and
critics of the program see as the absurdity of federal
spending rules. Families receiving the back payments were
required to spend the money within six months so that their
sudden wealth would not make them ineligible for the income-
based program.
Last summer, a group of disability experts and officials
met in Washington to discuss the mission of the children's
disability program. According to a confidential memo about
the July 19 meeting, a congressional staff director
``questioned exactly what we were trying to accomplish by
giving disabled children benefits.''
The response: ``From a social policy perspective,'' the
memo said, ``it was interesting that no one really had a good
answer''--not the policy experts, nor the people who run the
program, nor even the people who oversee the legislation.
a consolation prize
The children's disability program began in 1972 as a kind
of consolation prize.
The Senate had just killed the Nixon administration's
proposal for a guaranteed minimum income for poor Americans.
As a compromise, Congress established SSI to provide aid for
the ``deserving poor'': the elderly, blind and disabled.
Initially, no money was set aside for children.
Thomas C. Joe, a senior federal welfare official, inserted
the 26-word clause that expanded SSI to cover children. It
appeared in parenthesis, as follows: ``(or, in the case of a
child under the age of 18, if he suffers from any medically
determinable physical or mental impairment of comparable
severity).''
Joe, 58, now head of a Washington social policy think tank,
said that expanding the program to cover disabled children
was part of his ``incremental strategy'' to assist as many
poor people as possible. It was a welfare program
disguised as disability assistance.
There was no consideration of the financial or policy
consequences or of other ways to aid disabled children,
according to participants in drafting the original
legislation. Nor was there any public hearing that even
mentioned Joe's 26-word clause.
Joe acknowledged with some humor that he tucked the
provision into the 697-page bill in order to sneak it
through. ``I was afraid that too many people were going to
discover this and it would be a big controversy,'' he said.
``This is a good example of democracy not at work.'' he
added.
The Senate Finance Committee chairman at the time, Russell
B. Long (D-La.), made a run at killing the provision.
``Disabled children's needs for food, clothing and shelter
are usually no greater than the needs of non-disabled
children,'' his staff wrote in a Sept. 26, 1972, committee
report. It said disabled children needed health care and
rehabilitative services, not money, and noted that Medicaid
already covered poor children's health costs in 48 states.
During the closed-door, marathon weekend House-Senate
conference in October 1972 to reconcile different versions of
the bill, hundreds of other welfare, Medicaid and Medicare
issues were being resolved, and SSI received little
attention.
``It wasn't thought of as a big deal,'' said Frank Crowley,
a now retired senior staffer who worked on the bill. ``It was
one of these annoying little details.''
The 67-page report from the conference made no mention of
how the issue was settled. J. William Kelley, a House Ways
and Means Committee staffer at the time, has a copy of the
only existing conference paper about Senate amendment No.
564, which called for dropping Joe's provision. The single
sheet reads: ``CONFIDENTIAL. Summary: The House bill
authorizes payment to children under age 18. The Senate bill
does not.'' The line under ``Cost'' was left blank.
When the conference report was presented to the House on
Oct. 17, 1972, Rep. Phillip Burton (D-Calif.) rose to praise
the new program. ``Thanks to Tom Joe, this is now a
reality,'' he said.
what is disability?
Joe's amendment became law without anyone addressing the
obvious question: How do you define disability for a child?
Previously, disability assistance had been premised on the
disabled person's inability to work. The purpose was to make
up for lost income. The bill creating SSI defined a disabled
adult as someone ``unable to engage in any substantial
gainful activity.''
But children don't work, at least until they become
teenagers. ``It is ludicrous on its face to apply the same
standard to children,'' said Joseph Humphreys, a former
congressional staffer who worked on the 1972 bill. Humphreys
called the 26 words ``a punt by Congress'' that left
regulators to decide what to do.
The meaning of Joe's 26 words--especially the phrase
``comparable severity''--has been controversial ever since.
Even today, Joe said, he doesn't know exactly what the phrase
was supposed to mean.
In writing regulations, the Social Security Administration,
which runs SSI, said an adult was eligible if his or her
disability appeared on a predetermined list of physical and
mental impairments. If it didn't, the adult could still
qualify by having a personal evaluation that determined that
he or she was unable to work.
The regulations treated children differently. They had to
manifest one of the listed impairments, such as acute
leukemia, chronic epilepsy or serious mental retardation.
Because children generally don't hold jobs, individual
evaluations were not considered necessary.
In the early 1980s, the Reagan administration moved to
slash the number of people on federal assistance programs,
including SSI. One of the thousands of people affected was
Brian Zebley, a 5-year-old retarded boy. His family filed a
lawsuit, charging that the government was illegally denying
benefits to Brian and other children.
As the case wound its way through the federal courts, it
attracted a vigorous and passionate advocate--Jonathan Stein,
a legal services lawyer in Philadelphia. The legal
counterpart to Joe, Stein saw the courts as a way to extend
benefits to the poor. He and a colleague, Richard Weishaupf,
took Zebley's case all the way to the Supreme Court.
Stein spotted the logical flaw in the administration's way
of determining eligibility: The ``comparable severity'' test
could not be applied to children unless the methods of
assessing disability in adults and children were
themselves comparable. Children deserved the same kind of
individual assessments that adults were receiving, Stein
argued.
A Supreme Court case often carries the expectation that
large constitutional, moral or social issues will be
addressed. The Zebley case, however, was framed narrowly: Had
the government properly interpreted the law? In 1990, in
Sullivan v. Zebley, the Supreme Court ruled 7-2 in Zebley's
favor and ordered the Social Security Administration to give
children the same individual analysis as adults.
To implement the high court's ruling, the agency asked a
panel to experts to settle the question: What is the work of
a child?
The panel's answer, in the form of new regulations, is the
primary cause of Nora Porter's complaints. The new rules
defined a child as disabled if his impairments
``substantially reduce'' his ability to ``grow, develop or
mature physically, mentally or emotionally and thus to engage
in age-appropriate activities of daily living.'' These
activities ranged from learning, communicating and performing
in school to interacting appropriately with peers and family
members.
Social Security officials said the panel was seeking a
common-sense way of comparing children and adults. In
Porter's view, they failed. ``Age appropriate is a fictitious
standard,'' she said. ``It applies to the perfect child, and
any deviation from that allows someone to apply for and
likely be declared disabled.''
James Perrin, a Harvard Medical School pediatrician who
helped develop the regulations, said Porter's criticism was
unrealistic and out of touch. He said physicians needs some
standard to assess a child's behavior. ``None of us can think
about children without raising the question of age-
appropriate behavior,'' he said. ``There's no way of
approaching children and adolescents without thinking about
that.''
victory provides leverage
Stein's legal victory gave him enormous leverage over the
children's disability program. According to federal and state
officials, he became the program's de facto supervisor.
Stein regularly threatened to seek contempt-of-court
citations when he felt the Social Security Administration
wasn't implementing the rules fast enough. He also provided
the news media with information on how the agency's foot-
dragging was costing hundreds of thousands of disabled
children money that the Supreme Court said they deserved.
One of Stein's most significant accomplishments was getting
Social Security to review roughly 450,000 cases, dating to
1980, in which children had been denied benefits. This led to
the 150,000 lump-sum back payments.
But not even Stein could do anything about the government's
requirement that the recipients spend the money within six
months to remain eligible for the program. Stein
unsuccessfully tried to create an exception for back payment
recipients, calling the rule ``Kafkaesque.''
The rules legitimized and even encouraged shopping sprees.
In a case that both federal officials and program advocates
said was fairly typical, Beverly Smith of Greenville, Ky.,
received a back payment in 1992 of $13,000 for her 11-year-
old son, who is hyperactive and was deemed disabled under the
new rules. Smith, who earns about $8,000 a year sweeping up
in a local bank, said she was shocked to receive so much
money at once.
She used the money to buy a car, a washer and dryer, a
refrigerator, a stove, a television, a $2,500 computer and
three jogging suits for her son, she said in a recent
interview. She also repaired her bathroom, leaky roof and
collapsed hallway floor.
The computer, she said, has helped her son to sit still for
long periods of time for the first time in his life. The
stove had to be fitted with protective glass doors because
her son once started a fire in the kitchen.
Smith now receives a regular monthly SSI check from the
government for $446, in addition to Medicaid benefits.
In other cases disability money--both the back payments and
the monthly checks--has been spent on everything from medical
expenses not covered by Medicaid to family vacations. In some
cases, families have tried to avoid the spending sprees by
establishing trust funds for children, but such arrangements
are legally complex and prohibitively expensive.
The Social Security Administration does require an
accounting from the person who is entrusted with the child's
check. But the agency does not have the resources to
scrutinize spending on a large scale. A guardian is suspended
only if an egregious misuse of the money is called to the
agency's attention.
``When you get into programs like this,'' said Louis D.
Enoff, a 30-year veteran of the Social Security
Administration and its acting director until July 1993, ``if
you write something that's very, very tight, then you have
great difficulty. . . . You're going to have to follow up
with a tremendous administrative detail to follow it through.
What are we going to do? Follow every penny and ask for check
stubs? And go see the evidence?''
Enoff said he wasn't sure a purchase such as a car should
be allowed. ``Yeah, they may buy a new car, but it's not a
Mercedes or something,'' he said. ``That's probably
benefiting the kid as much as anything, because he needs
treatment and he gets better treatment. . . . If the child
has to go to the hospital once a week, there're taking a cab
now. So you pay for the car pretty quickly.'' He added. ``I
mean, I would not buy a car, maybe, if it was me.''
Social Security officials said the evidence of abuse is
small. ``I believe that most people are honest people. . . .
who really care about their kids,'' said Barry Eigen, a
senior Social Security official. They're not trying to beat
somebody out of something. They need this.''
Fractured Administration
Administration of the child disability program is divided
among state and federal offices in a vast, fractured system
where hardly anyone is responsible for seeing the big
picture.
First, applicants visits federal Social Security offices,
where financial eligibility for the program is determined.
Then, the applications are sent to separate state offices,
such as the one where Porter works in Harrisburg. The state
offices determine medical eligibility. Finally, the cases
return to the Social Security offices, which make the monthly
payments and oversee the spending of the money.
Doctors and examiners in the state offices make their
judgments on the basis of applications and medical
assessments. They almost never meet the children they are
evaluating or the parents who are spending the money. ``Our
work begins in the mailroom when we receive a file and ends
in the mailroom when we send it back with an allowance or
disallowance,'' said Myrtie Adkins, the Maryland office
director.
Meanwhile, the Social Security officials who see the
applicants have no input on the disability determination.
``We don't question the decision,'' said Ruby Burrell, head
of the Camp Springs, Md., Social Security office. ``We don't
even question if they are really disabled. It would be
improper to do that. . . . You meet the criteria, you get the
benefits.''
Many recipients come from troubled families, where parents
or guardians may have their own addictions or pathologies.
Karen Bolewicki, a senior examiner in Maryland for eight
years, said ``at least one-third'' of her cases involve
families in which a parent is a drug or alcohol abuser. And
Maryanne Bongiovani, a psychologist in Maryland for five
years with a PhD, said a quarter of the 4,000 children's
cases she has reviewed involve sexual abuse by a family
member.
Kenneth R. Carroll, a psychologist with a PhD and a former
colleague of Porter's in Pennsylvania, said these troubled
family situations made him uncomfortable approving certain
applications. ``Many of the problems these children manifest
are largely traceable to parental neglect or abuse,'' said
Carroll. ``Behavioral and emotional problems or conduct
disorders that are directly attributable to inadequate
parenting are being called disabilities, and the parents are
receiving a cash award for having achieved the problem.''
But Leslie Ellwood, a pediatrician with Virginia's office
of disability determination, said just because a disability
stems from poor parenting doesn't mean the children do not
deserve assistance. ``You don't want to visit the sins of the
parents on the child,'' Ellwood said.
To address all these complicated questions, the government
has now written some 40,000 words to interpret Tom Joe's
original 26-word phrase. ``We're doing a lot here based on
one little statement,'' said Louis Enoff. ``And is this
really what was meant?''
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