Preventing Social Security Fraud
Floor Speech
* Ms. LINDA T. SÁNCHEZ of California. Madam Speaker, I rise today to introduce the ``Preventing Social Security Fraud Act of 2010.'' This bill will reduce the Social Security Disability backlog by punishing insurance companies that force policyholders to fraudulently apply for disability benefits.
* The initial application backlog for Social Security Disability will be more than 1 million applicants by October. The disability hearing backlog sits at an average of 446 days with 718,000 people waiting for a hearing.
* Despite these staggering numbers, a handful of bad actors in the insurance industry force individuals who are capable of working to apply for disability benefits, and when denied, forces them to appeal the decision again and again.
* These companies do this because it benefits them financially. Each application in the disability process lower's the company's cash reserve requirement. The companies also know that if one of their policyholders happens to hit the jackpot and receive Social Security benefits, then the insurer can lower its monthly payout to the policyholder by that amount.
* Nevermind that these individual policyholders must certify under threat of fine or imprisonment when applying for benefits that their claim is legitimate. The policyholder is forced to take all the risk, while the insurer wins either way.
* The legislation I am introducing today requires insurers to certify to the Social Security Administration that a claim is legitimate when it forces a policyholder to apply for Social Security Disability. It is important that we protect the right of all Americans to apply for these benefits and appeal legitimate claims.
* This bill in no way threatens that system. For those who apply for disability on their own, nothing changes. For those who are forced by their insurers, I merely ask that the insurer take the same oath required of their policyholder and stand by the claim.
* I urge my colleagues to support this important legislation.
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