Social Security Lawyers Can Now Earn Higher Fees Because of Supreme Court Decision

Since 1956, the Social Security Administration(SSA) has made disability benefits available to people whose long-term medical conditions make completing their jobs impossible.

Lawyers who want to maximize their earning capacity don’t do Social Security law. They would be crazy to do Social Security law.

Recognizing that many Social Security disability claimants are in poor financial health, the federal government devised a payment scheme whereby lawyers receive a portion of their client's judgment if they win and nothing if they don't.

Since 1956, the Social Security Administration has made disability benefits available to people whose long-term medical conditions make completing their jobs impossible.

A U.S. Supreme Court ruling earlier this year created a uniform method for allocating fees across judicial jurisdictions, ensuring attorneys will have access to higher fees regardless of where they practice.

Considering that just 22% of workers receive disability benefits on the first try, the attorneys who help these workers often don't see payment for years, if ever.

Without attorneys, disability benefit applicants can get lost in the confusing maze of the claim process. They must first take their case before an administrative law judge(ALJ), and if the judge rejects the claim or makes a mistake — which attorneys say is fairly common — they then must go to federal court to dispute the decision.

In some Federal Circuits, judges interpreted separate limits the Social Security Act placed on fees for legal work before the SSA and the federal court as a single limit, capping the overall fees at an amount equivalent to 25% of the client's benefit award.

As an example, Lawyers in the Third Circuit, were not affected by the fee cap that plagued disability attorneys in the Fourth, Fifth and Eleventh circuits before the recent Supreme Court decision.

In those circuits, judges interpreted separate limits the Social Security Act placed on fees for legal work before the SSA and the federal court as a single limit, capping the overall fees at an amount equivalent to 25% of the client's benefit award.

In other circuits, like the Third, judges allowed attorneys to collect an amount equivalent to 25% of the client's benefit award for court-level work. For agency-level work, attorneys could collect either $6,000 or an amount equivalent to 25% of the benefit award, whichever is less. Fees could come from both the benefit award and the federal government, which offers a pool of money to disability attorneys under the Equal Access to Justice Act.

The ruling's main impact could be to encourage Social Security attorneys who already practice in federal court to continue doing so, rather than abandon cases at the appeal stage because the money isn't good.

In the past, Social Security claimants' probability of successfully going up against the SSA varied depending on where they were. Now, claimants should have an easier time across the country.