The Social Security Administration recently announced a small increase to the maximum attorney fee that lawyers representing disability claimants will be paid. As usual, SSA took a simple idea and made it unduly complicated, causing confusion for everyone.
Currently, if you hire a disability attorney to represent you under a “fee agreement” SSA will withhold 25% of your past due (lump sum) payment with a maximum fee of $6,000 if your case is approved and past due benefits are payable. The lump sum represents your monthly benefits that have accrued while you have been waiting for a decision.
In June, 2022, SSA announced that the fee cap would be raised from $6,000 to $7,200, effective November 30, 2022. This means that in cases decided by SSA prior to November 30, 2022, the fee cap will be $6,000, but in cases decided on November 30, 2022 and thereafter the fee cap will be $7,200.
This increase in the fee cap has been delayed far too long and it does not account for inflation and the increased cost of doing business. The cap was raised from $4,500 to $6,000 back in 2009 (13 years ago). While your lawyer’s earnings may not be at the top of your list of things to worry about when you are unable to work, in pain and struggling to get by every day, SSA’s policies regarding attorneys’ fees does impact you.
How SSA’s Attorney’s Fee Limitations Affect You
The most direct impact of SSA’s fee cap is to force attorneys to be extremely selective in accepting cases for representation. As you probably know, SSD cases often take up to 24 months to be processed by SSA. During that time, your lawyer is paying salaries, rent, utilities, office expenses, insurance and dozens of other costs but receiving no payments. Further, SSD attorneys only get paid if we win past due benefits and that’s if they decide to pay us. I currently have 7 or 8 cases that I have won, with my fees approved by the judge, but SSA won’t release the money. No one returns my calls and who knows if I will ever get paid. SSA even charges attorneys a “user fee” to withhold and pay attorneys our fees directly. Continue reading →