[Congressional Record (Bound Edition), Volume 156 (2010), Part 11]
[Extensions of Remarks]
[Page 14957]
[From the U.S. Government Publishing Office, www.gpo.gov]




              PREVENTING SOCIAL SECURITY FRAUD ACT OF 2010

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                         HON. LINDA T. SANCHEZ

                             of california

                    in the house of representatives

                         Friday, July 30, 2010

  Ms. LINDA T. SANCHEZ 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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