Two key Washington lawmakers are raising concerns about the "troubling" lack of progress in implementing reforms to the federal railroad disability system, even years after the conviction of several LIRR retirees for defrauding it.
In a letter to the board last month, Senate Labor Committee chairman Lamar Alexander (R-Tenn.) and health and retirement security subcommittee chairman Mike Enzi (R-Wyo.) expressed concerns that several outlined measures to curb fraud of the disability system "were not effective."
"It is troubling that seven years after the LIRR fraud was publicly revealed, many significant reforms to the occupational disability program have not been implemented," they wrote.
Changes to the system could be put on hold with the recent resignation of the U.S. Railroad Retirement Board's chairman.
Created in 1935, the railroad board is a three-member panel that administers federal retirement benefits to railroad workers, who do not receive Social Security benefits.
Delay on reforms
The senators noted that, a year ago, the board announced several planned changes to the disability application process to protect its integrity, including requiring additional independent medical evaluations in some circumstances and enhanced training for fraud awareness.
But, as Alexander and Enzi wrote, some of the deadlines for those new measures to be put in place "go well into 2016, and many others have no stated deadline at all."
"We expect RRB to effectuate timely, meaningful changes in order to achieve the utmost degree of integrity in its disability programs," the senators wrote in the Sept. 14 letter.
Railroad Retirement Board spokesman Michael Freeman said in a statement that the agency is "committed to improving program integrity throughout its operations, enhancing existing controls over the disability program, and implementing program and policy changes in order to support a benefit program free of waste, fraud and abuse."
"The agency welcomes the opportunity to share with the Senate its efforts and progress in achieving this goal, and will be responding to the Committee's request for information as soon as possible," Freeman added.
Following a 2008 New York Times investigation that found that more than 90 percent of LIRR retirees were receiving disability benefits, federal prosecutors charged several former LIRR workers, two doctors and a retirement board employee with taking part in a conspiracy to defraud the board, including by falsifying medical records.
Eventually, 33 defendants were convicted, including 29 former LIRR employees.
Newsday reported in November that the retirement board approved 91 percent of new claims by the disqualified LIRR retirees, even after subjecting them to more intense scrutiny, including exams by board-selected doctors.
In their letter, Alexander and Enzi pointed out that the high re-approval rate is "roughly the same as before the scandal was first revealed."
The lawmakers made several specific requests to the retirement board, including how LIRR applicant approval rates "compare to approval rates for other government disability programs," and a status report for several previously announced reforms.
The latest call for change in the U.S. Railroad Retirement Board comes weeks after the board's longtime chairman Michael Schwartz stepped down at the end of August.
"I am confident the professionalism you demonstrate each week and every day will continue to serve the agency for years to come," Schwartz wrote in a letter to board employees.
Leaving a void
Schwartz's resignation leaves the board with only its labor and management representatives, Walter A. Barrows and Jerome F. Kever, respectively, and no tiebreaking vote.
Until President Barack Obama nominates a Retirement Board chairman, Inspector General Martin Dickman said Schwarz's departure could make needed disability reforms even less likely in the near future.
"I don't see much happening," said Dickman, who called Schwartz a "major force" in lobbying for change. "At least he was pushing both sides to get together and find common ground on some things."