Cash-strapped states are aggravating Social Security Disability Insurance benefits decision delays by putting SSDI staffers on unpaid leave – even though the federal government pays the staffers’ salaries.

Witnesses talked about the furloughs during a hearing of the House Ways and Means Committee income security subcommittee on efforts to eliminate the Social Security disability backlog.

Private disability insurers are eager to see the SSDI backlog eliminated, in part because they believe their seriously disabled claimant deserve to collect SSDI benefits – and to qualify after 2 years on SSDI for access to Medicare health insurance benefits for the disabled – and in part because they coordinate their own benefits with SSDI benefits.

The number of backlogged SSDI claims was about 576,000 in 2006, according to written testimony submitted by Daniel Bertoni, a U.S. Government Accountability Office director.

The size of the backlog was about the same as in 2005, but it was 40% bigger than in 2002, Bertoni estimates.

Peggy Hathaway, vice president of the United Spinal Association, Silver Spring, Md., who testified on behalf of the Consortium for Citizens with Disabilities Social Security Task Force, presented bleaker backlog statistics.

The number of pending cases fell to 765,527 in February, down from 768,540 in December 2008, but the backlog is up from almost none in 1997, Hathaway reports in her written testimony.

Rick Warsinskey, a Social Security district office manager in Cleveland, said staffing shortages and the high volume of calls have forced many Social Security Administration offices to all but give up on answer the telephones.

In written testimony, Warsinskey quoted the following SSA district manager survey response:

Most days, we are so short of staff that we don’t even assign a person to answer the incoming lines. What we do instead is just pick up the phone when it goes to over ring, which is 20 minutes after it goes to hold. Usually I am the one who answers it then. Our phone service is deplorable. And we are so busy interviewing face-to-face or teleclaims or adjudicating Internet claims that we don’t return phone calls left on voicemail promptly either.

The federal courts recently have held that private insurers must go to great lengths to insulate disability claim reviewers from pressure to reject valid claims.

But the SSA itself “has a long history of interference in the functioning of its administrative law judges,” according to Ron Bernoski, an SSA administrative law judge in Milwaukee and president of the Association of Administrative Law Judges, Coral Gables, Fla.

In the early 1980s, Bernoski said, the SSA engaged in an intensive review of administrative law judges who decided a high percentage of claims in favor of the claimants.

Several witnesses presented testimony on state finances hurting efforts to speed up SSDI claim processing by including disability program personnel – who were employed by the states, but with 100% of the costs paid by the AA – in involuntary furlough programs.

SSA Inspector General Patrick O’Carroll says a preliminary survey suggests that 5 of the 52 state disability determination services already have included DDS staffers in furloughs, and 3 are planning to do so.

“Unfortunately, the 5 states that decided to furlough their DDS employees–California, Maryland, Massachusetts, Oregon, and Connecticut–comprise 15% of the national DDS workload each year,” O’Carroll said, according to the written version of his testimony.

Furloughs in California, for example, will cause a 10% shortfall in SSDI processing capacity, O’Carroll said.

“We estimate that this will delay over 2,300 applications from being processed, of which we estimate 776 would result in allowances,” O’Carroll said.. “Those 776 beneficiaries will be forced to wait to receive their $648,000 in monthly benefits as a direct result of the furloughs.”

Links the written versions of the witnesses’ testimony and other SSDI hearing documents are available here.