By Scott B. Elkind, Esq.

Profit is made by insurers by acquiring premiums, investing the proceeds, and paying claims in hope of making more money from the investments in the interim period. Here is the catch. They have actuaries who compile the statistics and set premiums to guarantee a profit. So, the only way to create an even larger profit (or as I term it, a windfall) is to deny merit worthy claims and waiting to see if claimants have the capacity to fight the claim denial.

On the surface this seems unfair and cold, but is actually far more devious than meets the eye. You see, the insurers know how to pick their victims. Who better than disabled persons who are living on a limited budget (funded in part or in full by the insurer) and tend to be focusing on improving their health and maintaining their families than paying attention to the insurer’s activities. The insurers know that kicking a person when they are down is the best time. A benefit termination will instantly overwhelm the claimant and place both economic and time pressures on this already impaired individual. The insurer hopes the claimant will simply give up or will be unable to locate a competent counsel to assist them.

Of course, the insurer will not directly approach the claimant and tell them they are conducting an investigation. At best, you may receive an innocuous letter stating that they are conducting a review of some sort as part of their “ongoing investigation” of your claim. As part of this routine inquiry, the insurer may be undertaking any of the following unsavory activities:

1. Direct Provider Contact. This is comprised of having an internal nurse or physician contact your treatment provider(s) in order to acquire statements which can (and will) be utilized to deny your claim. This may include the infamous “what we discussed” letter which concludes with a statement that if your provider does not respond then the statements will be deemed truthful. (How nice)

2. Background Information Check. The insurer will research your assets including your vehicles, real estate, bank accounts, and credit information. The insurers want this information to find out if you have sufficient resources to “sustain litigation” if they decide to deny your claim. (Double goody)

3. Active Surveillance. This is the favorite of my clients. The insurer will hire an investigator to stake out your house for a few days to check on your activities. If the insurer wants a “sure thing” they will set up the infamous “independent medical evaluation” (a.k.a., a defense examination) whereupon you will be followed by the insurer to the examiner’s office and on the return trip. As part of the common surveillance, you may receive phone calls to your home with the investigator hanging up if you answer. (Cute)

4. Home Interview. This one is fully within the control of the claimant. Do not ever let these people in your home. They will pretend to be friendly and snoop about looking for anything of note such as general cleanliness or your ability to make yourself comfortable to hold against you in their report. If the interview turns unpleasant, the interviewer may produce video surveillance of you performing.

Unfortunately, SSA is lagging far behind in completing many internal reviews with the following selected reviews due for completion in 2007:

• Administrative Law Judge Caseload Performance
• Social Security’s Disability Service Improvement Process
• Management’s Use of Workload Status Reports at Hearing Offices
• Recovery of Benefit Overpayments
• SSI Income Recipients Whose Medicare Were Terminated Because of Death

Even worse is that the following internal review are not slated to begin until 2007:

• Aged Cases at the Hearing Level
• Disabilities Classified by SSA as Difficult to Prove
• Proper Classification of Terminally Ill Beneficiaries
• Transfers of Case Workload Among Hearing Offices

If this is not bad enough, SSA has recognized that it has not correctly calculated workers compensation offsets in 110,00 cases and has only completed the review of the first 61,000 so far.

So, where is your tax money going if the funding is not claims are not being processed timely? Here are some examples:

• Software migration at 26 DDS offices at a cost of $18M
• Ongoing development of electronic folder and data management architecture at a cost of $17M
• Maintenance, repair, and rebuilding activities at the Great Lake Program Service Center at a cost of $15M
• Yearly cost of security contracted at $40M
• Case folder services at SSA’s Megasite Folder Storage Facility costing $32M

The message being sent by this is very clear. SSA has little intention of funding any initiatives to address their enormous case backlog which will only increase in years to come. The current case processing time of approximately two years for a claimant to receive benefits will only worsen and result in increasing numbers of deserving disabled claimants suffering while waiting to be awarded benefits. As people who are without money are not politically empowered, their voices will only be heard once the burden caused by their disability comes to rest on their families and communities.

Scott B. Elkind is a Principal with Elkind & Shea, The Disability Benefits Law Firm. His practice focuses exclusively on disability benefits.