Ethical Considerations In Representing Social Security Disability Claimants

REPRESENTING SOCIAL SECURITY DISABILITY CLAIMANTS: ETHICAL CONSIDERATIONS

Women’s Bar SectionHidalgo County Bar Association

Suzanne Villalón Hinojosa1-800-481-0302svhdisbilityhelp@gmail.comwww.southtexasdisabilitylawyer..com

TWO PROGRAMS HOW ARE THEY DIFFERENT?

An insurance program funded by FICA taxes

Pays later of 6 mo. from onset or 1 yr prior to DOA

4 yrs to reopen app. Medicare after 2 yrs Auxiliary Other benefits:

widow(er)s, adult child

A welfare program funded by general revenues

Pays later of mo. after DOA or mo. after onset

2 yrs to reopen app. Medicaid from DOA No family benefits Other benefits: child

Social Security Disability InsuranceDIB, Title II

Supplemental Security IncomeSSI, Title XVI, SSID

Suzanne Villalón Hinojosa [email protected] www.southtexasdisabilitylawyer.com

TWO PROGRAMSHOW ARE THEY DIFFERENT?

Depends on earnings record

2009 estimated average benefit $1,064 (includes 5.8% COLA)

No resource limits other than WC offset

WC offset if combined exceeds 80% of ACE

Trial work period 20 CFR Part 404

Depends on resources 2009 benefit max $674

mo. (individual) $1,011 (couple)

Resource limits: $2000 (individual) $3000 (couple)

WC (resource) usually precludes entitlement

No trial work period 20 CFR Part 416

Social Security Disability InsuranceDIB, Title II

Supplemental Security IncomeSSI, Title XVI, SSID


TWO PROGRAMSHOW ARE THEY SIMILAR? Monthly income benefit so long as

claimant remains “disabled” Same definition of “disabled” (except

Child SSI) Regulatory 5 step determination used in

decision making process (3 steps for Child SSI)

Benefits are increased each year based on cost of living adjustments

Attorney fee withheld from past due benefits and sent directly to attorney from SSA. Costs are not withheld by SSA.


DEFINITION OF DISABILITY

Adult An individual shall be considered to be disabled

for purposes of this title if he is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months.

42 U.S.C. § 1382c(a)(3)(A)


5 STEP SEQUENTIAL EVALUATION PROCESS FOR ADULTS

1. Is the claimant working (SGA)?2. Does the claimant have a severe

impairment?3. Does the impairment(s) meet or

equal a medical listing?4. Is the claimant able to perform prior

work?5. Is the claimant able to do other work?

20 CFR §§ 404.1520(a)(4) & 416.920(a)(4)


REGULATORY HISTORY OF SSA ETHICS RULES

• Original regulations published – April 26, 1969 (34 FR 6973)

• Revised – August 5, 1980 (45 FR 52078)

• Revised – May 29, 1991 (56 FR 24129)

• Current rule draft proposal published – February 1995

• Final rules notice of proposed rulemaking – January 3, 1997 (62 FR 352)

• Final rules published – August 4, 1998 (63 FR 41404) Effective Date

September 3, 1998• Amended

– February 17, 2006 (71 FR 2871)

Regulations regarding Disability

Service Improvement (DSI) process

•Proposed new rules published

•July 27, 2005 •(70 FR 43590)

•Final rules published

•March 31, 2006

•(71 FR 16424)

•Rulemaking process suspended

•January 29, 2008


FEATURES OF THE RULES

• Uniform national standards for both attorney and non-attorney representatives.

• Designed to address the special circumstances of SSA’s nonadversarial administrative process.

• SSA says they are compatible with American Bar Association’s Model Rules of Professional Conduct and Model Code of Professional Responsibility.


RULES STRUCTURE

Affirmative Duties

Promptly submit evidence

Assist claimant in responding to SSA’s request for information

Represent claimant competently, diligently promptly.

Prohibited Actions

• Improperly treat claimant• Knowingly charge an

improper fee• Knowingly make false

statements• Unreasonably delay process• Divulge claimant

information without consent

• Offer anything of value in an attempt to influence

• Disruptive behavior: disorderly conduct, absences/tardiness, threatening actions


AFFIRMATIVE DUTIES20 CFR §§ 404.1740(B)(1)&(2) AND 416.1540(B) (1)&(2)

• Acquire and organize the evidence and submit it “for the earliest possible consideration.”

• Help the claimant respond to agency requests for information.

• Cooperate with the agency’s processes.


ADMINISTRATIVE APPEAL PROCESS

After an ALJ denial, the claimant can file a 2nd application and appeal the 1st application to the Appeals Council.SSA will process the 2nd application thru the initial and reconsideration levels but will not conduct a 2nd hearing until the Appeals Council resolves the 1st claim. See HALLEX I-5-3-17 and The Ins and Outs of Subsequent Applications.pdf


FEDERAL↔STATE HAND OFFSIN DECISION MAKING PROCESS


ISSUES IN EVIDENCE SUBMISSION

• When to submit– Should you submit even though the agency is also

requesting records?– Should you submit records without a copy of the exhibit

file?• How and what to submit

– Should you change the records, i.e. pull duplicates, separate by type of providers?

– Should you submit adverse evidence? – How does the agency’s incremental move to a fully

automated appeal process change these issues?• Paper, CD, online access to the claim file, online applications

and appeals • ALJ Prehearing Orders

– Judges cannot issue Prehearing Orders that are inconsistent with the Social Security Act, regulations, rulings or HALLEX.

• Sarah Humphreys, Office of General Counsel ODAR/SSA, 2004 FOSSCR, Austin, TX.


ADVERSE EVIDENCE

• Advise from SSA in 2004:– The regulations require claimants to prove

their disability, not their ability.– The representative stands in the same

position as the claimant.– If faced with a request for information that is

adverse, decline to provide it because it does not support the claim for disability.

– But don’t make a false or misleading statement.

• Sarah Humphreys, Office of General Counsel ODAR/SSA, 2004 FOSSCR, Austin, TX.

In both 1995 and 1997 the ABA opined that these rules are overly broad with regards to the duty to submit evidence. “The ABA believed that the rules continue to include provisions that could give rise to serious ethical conflicts.” 63 FR 41407


ADVERSE EVIDENCECHANGES IN THE LAW • §1129 of the Act amended by Congress.

– Prior prohibition against actively making false or misleading statements viewed as “loophole” by Congress.

– Now SSA can impose penalty in absence of affirmative statement (“withhold” or “omit” information).

– SSA can re-determine entitlement to benefits if “fault or similar fraud” is involved in concealing information “material” to the determination.

• SSA can exclude representatives who commit an offense under this provision.


ADVERSE EVIDENCEOTHER SOURCES OF AUTHORITY

• ABA Model Rules & TX. Disciplinary Rules of Professional Conduct– ABA Rule 1.6 & TX 1.05 Confidentiality of Information– ABA & TX Rule 3.3 Candor Toward the Tribunal

• Is SSA hearing ex parte?– Rule 8.5 Choice of Law

• Rules of jurisdiction applies unless rules of tribunal provide otherwise.• “If federal law mandates disclosure of adverse evidence in a

Social Security proceeding, it is difficult to see how any perceived contrary obligation under state rules could possibly defeat that mandate.”

– Robert E. Rains Professor and Director, Disability Law Clinic, Pennsylvania State University Dickinson School of Law, 2005 NOSSCR, Orlando, Florida

• Best Practices: – Submit all treatment records.– Request and submit depending upon when hired and based on SSAs

average processing time.– Remove duplicates from prior submissions and from exhibits (if

available)– Don’t cull multiple provider records supplied by one provider.


AFFIRMATIVE DUTIES20 CFR §§ 404.1740(B)(3) AND 416.1540(B)(3) • 1998 rules now allow the agency to

take action against attorneys, not just non-attorney representatives.

• Based on ABA Model Rule 1.1• SSA’s profile:

– “representatives who, because of a particular role they have in their community, or a particular familiarity with certain segments of society, have easy access to claimants who are vulnerable, who trust too easily, and who don’t know or understand enough to realize they’re being victimized.”

» Sarah Humphreys, Office of General Counsel ODAR/SSA, 2004 FOSSCR, Austin, TX. Suzanne Villalón Hinojosa [email protected]

1-800-481-0302 www.southtexasdisabilitylawyer.com

PROHIBITED ACTIONS20 CFR §§ 404.1740(C)(1)

• Honest mistakes do not constitute a violation.

• A violation could also be a prohibited action under the Act– prohibits representatives from, with

intent to defraud, in any manner knowingly deceiving, misleading, or threatening any claimant, prospective claimant or beneficiary.

• § 406(a)(5) of the Act

• SSA says not commonly invoked but when seen it’s usually “egregious.”



• By statute SSA sets the max fee– provides that for Agency appeals, the Commissioner shall

withhold 25% of past due benefits, up to $6000.00, subject to approval of fee agreement. User fee ($75 or 6.3%) is also deducted and cannot be passed on to the client.

• § 406(a) of the Act

• Regulations require written fee agreements approved by SSA.

• 20 CFR §§ 404.1720 & 416.1520

• A violation could also be a prohibited action under the Act– prohibits representatives from knowingly charging or

collecting any fee, or making any agreement to charge or collect a fee, in excess of the maximum fee prescribed by the Commissioner.

• § 406(a)(5) of the Act

• SSA says this is the most common violation. (75%)



• Claimants risk loss of benefits.• §1129A of the Act

• Civil monetary penalty imposed on anyone making false or misleading statements.

• §1129 of the Act

• SSA says this is the 2nd most frequently charged violation.



Not responding to requests for information

Failure to appear to court settings

Requests for extensions and fails to meet deadlines



• Criminal consequences to disclosure of information SSA provides.– Felony, w/5 yr. imprisonment and/or $10,000 fine per

occurrence• § 1106 of the Act (42 USC §1306)

• Common error, argument that compares similar case without redacting or obtaining consent.

• Non-attorney sent letter to other clients, complaining about another client.



Pretty much this is bribery, subtle or otherwise.

SSA has investigated at least one pattern of behavior between a representative and an ALJ which also resulted in a criminal prosecution against both parties.



• Pre-1998 regulations contained no authority regarding these allegations

• Targets conduct that “exceeds the acceptable bounds of zealous representation.”

• Requires a “case-by-case assessment

• SSA says this is the 3nd most frequently charged violation.


REPRESENTATIVE SANCTION CASE INFORMATION FOR FISCAL YEAR 2001 THROUGH 2006

# of Formal Complaints SSA filed

# of Cases … Before SSA Filed formal Complaints

# of Cases… After SSA Filed formal Complaints

# of Final decisions to Suspend or Disqualify

FY 2001 25 0 2 7

FY 2002 15 1 1 12

FY 2003 5 4 5 4

FY 2004 5 0 0 4

FY 2005 6 1 1 4

FY 2006 2 0 0 1

Total 58 6 9 32

Source: Response of Commissioner Barnhart to Questions for the Record from the September 27, 2005 hearing on the New Disability Approach from Congressman Sander Levin. November 8, 2005


Ethical Considerations In Representing Social Security Disability Claimants

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