"Legal Representation in Disability Claims" - Hilary Hoynes, University of California, Berkeley

Date
Dec 12, 1:20 pm2:35 pm
Location
Julis Romo Rabinowitz Building, Rm 217
Event Description

Hilary Hoynes is a Professor of Public Policy and Economics and holds the Haas Distinguished Chair in Economic Disparities at the University of California Berkeley. Hilary's research focuses on poverty, inequality, food and nutrition programs, and the impacts of government tax and transfer programs on low income families.

Abstract

Legal representatives play a prominent role in the Social Security Disability Insurance adjudication process, earning fees totaling $1.2 billion in 2019. Long ubiquitous in appellate hearings, disability representatives—including attorneys and non-attorneys—have begun appearing more frequently at the beginning of cases, during the initial review. This development has raised questions about the motives of disability law firms, who are sometimes perceived to prioritize their own interests in response to incentives in the fee structure set by the Social Security Administration. At the same time, these concerns have revealed just how little is understood about the value of legal representation for claimants in disability cases. We provide the first estimates of the causal impact of legal representation on case outcomes when representatives are engaged from the initial stage. Our analysis is made possible by new administrative data identifying representatives appointed to disability claims at the initial and appellate levels. To address selection into representation, we instrument for initial representation using geographic
and temporal variation in disability law firm market shares in the closely related but distinct appellate market. Among applicants on the margin of obtaining representation at the initial level, representation improves case outcomes and administrative efficiency across several metrics. Legal representation increases the probability of initial award by 23 percentage points, reduces the probability of appeal by 45 points, and induces no detectable change in the ultimate probability of award (including appeals). This pattern indicates that legal representation in the initial stage leads to earlier disability awards to individuals who would otherwise be awarded benefits only on appeal. Furthermore, by securing earlier awards and discouraging unsupported appeals, representation reduces total case processing time by nearly one year. Our analysis explores several mechanisms.