Senate Panel Exposes Fraud in Social Security Disability Program

The Huntington, W.Va., office of the Social Security Administration became the center of a multi-million-dollar, multi-year fraud scheme in which lawyers, administrative judges and doctors profited from the agency’s efforts to accelerate its disability claims processing, according to a report released Monday based on a two-year Senate staff investigation.

Following a preview on Sunday night’s “60 Minutes,” the bipartisan report, titled “How Some Legal, Medical, and Judicial Professionals Abused Social Security Disability Programs for the Country’s Most Vulnerable,” was unveiled just before a Monday hearing of the Senate Homeland Security and Governmental Affairs Committee, at which the SSA and Congress were blasted for poor oversight and for allowing a short-circuiting of quality-control in evaluating claims in disability programs that last year paid out $137 billion to 11 million Americans.

The report describes how the Social Security Administration under Commissioner Michael Astrue pressured administrative law judges to decide a high volume of cases, and in doing so, “failed to ensure they produced quality decisions.”

“Congress has acted as if getting more people on the program is more important than conducting oversight,” said Sen. Tom Coburn, R-Okla., who led the staff probe along with Sen. Carl Levin, D-Mich. “With the clock ticking on the Social Security trust fund, the people who are truly disabled pay the price.”

Coburn described particulars of how a Kentucky-based lawyer named Eric C. Conn became the country’s third highest-earning disability collection attorney through a scheme allegedly involving administrative law judges David Doherty and Charlie Andrus and a set of friendly doctors. They communicated using disposable cellphones, Coburn said, and emails that have since disappeared, to process hundreds of cases quickly without hearings and with only perfunctory medical exams, nearly all resulting in approvals for applicants and profits for the law firm.

The fraud was brought to light by employees of both SSA and the Conn law firm, some of whom were later subject to whistleblower retaliation, Coburn noted. Several of the whistleblowers appeared on “60 Minutes” and testified at Monday’s hearing. SSA executives scheduled to testify had to postpone because of the government shutdown, noted committee Chairman Sen. Tom Carper, D-Del.

The lesson, Coburn said, is that Congress must reform its oversight of SSA and task the agency with better monitoring of administrative law judges.

Levin told the hearing that Judge Doherty was placed on leave in 2011 and then retired, while Andrus last month was placed on administrative leave pending a review. “But Eric Conn is still going strong, reaping millions of dollars in attorneys’ fees, and just opened a new office in Beverly Hills, with no accountability for his actions,” Levin said.

Levin added that the report didn’t reach a conclusion as to how many of the suspect cases were decided wrongly. “This investigation is not intended to denigrate those on disability,” he said. “It was launched because some of SSA’s hard-working employees blew the whistle. The disability program plays a critical role in the lives of many Americans.”