New York, NY — Lawyers are manipulating the system at the expense of taxpayers & small businesses
Social Security Disability Insurance and the Americans with Disabilities Act are well-intentioned programs designed to protect the disabled, but the newest report in the Manhattan Institute’s Trial Lawyers, Inc. series finds that disability lawyers are exploiting legal rules to rake in in cash.
Breaking the Bank: Social Security Disability Insurance (SSDI)
Social Security Disability Insurance claims have skyrocketed, with payments nearly tripling from 2000 to 2013, even as disability rates have remained stagnant. The Trial Lawyers, Inc. report argues that SSDI has turned into a backup welfare program—with annual payouts higher than welfare, food stamps, school lunches and subsidized housing combined. Trial lawyers are driving the growth in SSDI enrollment: last year, they pocketed more than $1.2 billion of taxpayer money for handling SSDI claims. Meanwhile, the program is running enormous deficits, and the SSDI trust fund may be exhausted as soon as 2016.
Small-Business Shakedown: Litigation under the Americans with Disabilities Act (ADA)
Under the Americans with Disabilities Act, disabled individuals can sue businesses that do not provide reasonable accommodations. Although such suits cannot award money damages to plaintiffs, they can pay unlimited attorneys’ fees. Rather than promoting reasonable accommodations for disabled individuals, these lawsuits have far too often facilitated legal shakedowns in which aggressive attorneys take money from small businesses to “walk away.” ADA accommodation filings have doubled in the last six years, and large states like California, Florida, and New York that allow plaintiffs to recover money damages for disability suits under state law have become hotbeds for legal shenanigans.
Read the full report here for examples of attorneys that game the disability system and suggestions for reform.