Occasionally you might
have trouble getting paid after winning a disability
case. Based on our past experience as employees of
the SSA Fraud Division, we have created some
techniques to help you collect your fee in difficult
situations.
SSA requires that you
provide the claimant with a copy of your Fee
Contract and your Fee Petition with attachment.
These documents establish your right to a fee and
remind your client of his/her obligation to pay for
services rendered. Still, it is inevitable that
you’ll run into someone who will try to avoid paying
you. Here is how Disability Associates recommends
handling fee issues.
Step One: Pre-Warn
A client is much less
likely to avoid payment if he/she has been warned of
the consequences in advance. Include a paragraph in
your Fee Contract that spells them out. Your
greatest leverage is the potential loss of benefits
if your client refuses to pay you.
Warning:
Never
directly threaten a client with loss of benefits!
When you first go over the agreement with a
potential client, point out that this is in fact a
three-way contract between the client, you and SSA.
Be sure to review the delinquent payment clause,
gently pointing out that failure to pay fees is
considered fraud and can result in cessation of
benefits pending investigation. This puts him/her
on notice that this is a real obligation.
Step Two: Insert
Protective Clauses
Include protective clauses
in your Fee Contract describing your company policy
on billing and the consequences of withdrawal and
delinquent fees. Here are four sample protective
clauses, provided for training purposes only.
Consult your attorney for the actual language and
structure of your own Fee Contract.
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Sample
Delinquent Fee Clause:
If payment of
fees for services rendered upon
successful case completion is not
received as specified within this
Contract, Advocate reserves the right to
take such action as may result in the
immediate stoppage of Client benefits
until conclusion of investigation by the
Social Security Administration. |
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Sample
Withdrawal Clause:
Due to the
nature of this Contingency Fee Contract,
the parties expressly agree to
renegotiate in the event of a
termination of the Advocate-Client
relationship. Although Client may
terminate by written notice at any time,
Client expressly understands that he/she
shall not be relieved of obligations to
pay amounts due hereunder by such
termination. In the event Advocate
withdraws for such reasons as
misrepresentation made by Client,
Client’s failure to pay costs or
expenses within a reasonable time of
billing, Client’s failure to cooperate
with Advocate and/or any action or
request by Client which would require
Advocate to violate a State Code of
Professional Responsibility or any other
ethical standard to which Advocates are
subject, Client shall be responsible for
costs incurred to that point.
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Sample
Billing Clause:
Advocate
agrees to keep track of time actually
spent by Advocate on Client’s case. Upon
collection of any money or property,
Advocate shall provide a written
accounting showing Advocate’s
outstanding costs, fees due to Advocate
and amounts due Client. Upon case
conclusion, Advocate shall provide
Client a full accounting of all amounts
previously placed in trust for Client,
showing all disbursements and the
outstanding balance. Client may, at any
time, make written request for
information concerning his/her account
with Advocate. Advocate shall respond to
such requests within 14 days of receipt. |
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Sample
Termination Clause:
Client may
terminate this Contract by notifying
Advocate in writing. No costs will
accrue to Client for time expended by
Advocate in the process of withdrawal.
However, Client shall pay Advocate for
expenses incurred by Advocate on matters
other than withdrawal. Such fees and
costs shall be due and payable upon
termination. |
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Sample
Reinbursement Clause:
Client
understands that he/she is responsible
and shell be billed for all advocate
out-of-pocket extenses associated with
the representation of the case.
The reinbursement (case development) fee
can include but is not limited to phone
call charges, travel, hotel, parking,
meals, medical records, etc. The
reinbursement (case development) fee
will be added to the client's final bill
for representation and is due upon final
decision regardless of case outcome. |
Step Three: Action
Give your client several
opportunities to pay before taking action against
him/her and keep things friendly if at all
possible. If a client refuses to pay for services
rendered upon successful case completion, write
him/her at least three letters within a two month
period reminding him/her of the obligation. Offer a
payment schedule if he/she is having problems coming
up with the full amount all at once. Make sure this
offer is in writing, and if the client accepts it,
make sure to get it signed.
If nothing works, your
final letter should be stern and direct. If some
type of payment is not forthcoming within a
designated time frame of about two weeks, warn your
client that you'll begin legal action that may
result in the loss of his/her disability benefits.
If he/she still doesn't act to remedy this
situation, write a letter to your local SSA Fraud
Division, which is usually located at the DO or
regional SSA office.
In the letter, state the
client’s name and Social Security number. Inform SSA
that you acted as his/her authorized representative
and provide a copy of the Fee Contract, Fee Petition
and attachment. Tell SSA that you feel that the
claimant was not completely truthful with you in the
application process and that you believe there may
be fraud involved. It is not unreasonable to
conclude that the claimant may have been acting
fraudulently. After all, if he/she isn’t willing to
pay fees agreed to under contract, who knows if
anything else he/she has alleged is truthful?
This will spark an
immediate SSA review of the case. They will contact
both you and your client for an investigation, and
may stop paying benefits until the matter is
settled.
Contact your client after
taking these actions and explain that your fee must
be paid if he/she wants to continue to have your
support in the case. We have only used this approach
three or four times in the last ten years, but it
worked every time!
Alternative Enforcement
Approach
Here is another powerful
way to collect from a reluctant client. After you
have sent letters as explained above, take the case
to your state’s Small Claims Court along with signed
copies of your Fee Contract, Fee Petition and
attachment. You can do this even if your client
lives in another state.
Filing in Small Claims
Court will cost you between $25 and $150. Add this
fee and any other court expenses to the amount
claimed. You’ll almost always win when the Judge
reviews your detailed Fee Petition attachment that
documents line-by-line all of the work you did on
your client’s behalf. If the claimant fails to
attend the court hearing, you’ll win by default.
Present the favorable
judgment along with a copy of your signed Fee
Contract, Fee Petition and attachment to SSA for
review. Also submit a letter requesting
garnishment of a specified percentage of the
claimant's benefits on a monthly basis until the fee
is paid in full. SSA is then faced with a
garnishment request based not only on your proven
work on your client’s behalf, but also on a legal
decision made by a member of the Court. Result?
SSA will begin deducting an amount equal to the
specified percentage of monthly benefits until the
fee is paid in full. This approach works
about 60% of the time.
Olivia©’s Role in
Collecting Your Fee
Collecting your fee
in problem situations is made a lot easier with our
new Olivia© software, which allows you to create
extremely detailed Fee Petition attachments that are
difficult to argue against and that make it easier
for SSA to rule in your favor. As long as you
diligently entered and itemized your actions during
Case Processing, you can generate detailed
justifications of your fee with one click of a
button in Olivia©
