Study: Lawyers Rake In Billions From Federal Disability Program

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Investors Business Daily:

Lawyers have raked in more than $7.5 billion in fees from the federal Disability Insurance program since 2009, according to a Manhattan Institute report issued Friday. And that money has come directly out of the pockets of workers through the Social Security payroll tax.

 

The report, "Wheels of Fortune," finds that fees paid by the Social Security Administration to those representing disability applicants totaled $1.23 billion last year.

 

By October of this year, these fees had already topped $970 million.

 

The way the Social Security Disability Insurance (SSDI) program works is that, if a person secures legal representation while applying for benefits, and then qualifies for the program, the advocate gets a cut of the money.

 

The idea behind these payments — which are capped at $6,000 per enrollee — is to make sure that no one is denied disability benefits simply because they can't afford to navigate the system.

 

But as the Manhattan Institute report notes, lawyers have "found ways to exploit legal rules in disability statutes to their personal benefit." The paper highlights allegations of fraud, kickbacks and other schemes to get the maximum number of people on the disability rolls.

 

In addition, those who've been turned down twice by the program can appeal their denials to an administrative law judge, some of whom have a record of approving 90% or more of those appeals.