TSUS TO CLST MY THAT THE PURUCU M.ED BELON BLUCA E ELTITLED TO THE DO, ERITI U O Your basic Kolode an shiy bolento, plus the increlbed amoure based on the dependency of roluded in che check payable to you. You must report any event which affects the payment of these benefits. We are sending a copy of this notice to your attorney. The right to receive Deck Lung benefits corries with it concin responsibilities. They are explained in closure. Rece the enclosure carefully. Do sure that you understand clearly what you can expect by way of benefite, che vinc. is to be expected of you. If you have any questions or wish additional information about your boneftie, piecu get in touch with any social security office. ADDITIONAL INFORMATION ABOUT YOUR CLAIM Your claim for benefits has been processed and allowed under the Black Lung Benefits Act of 1972, which amends the benefit provisions of the Federal Coal Mine Health and Safety Act of 1969. The change in monthly benefit rates shown above is due to pay raises for government workers which had the effect of increasing Federal black lung benefits beginning with (January 1971 and/or January 1972, and January 1973. Your check includes all back payments due for 1970, 1971, 1972 and 1973. The check you receive next month will be in the amount you will be getting regularly hereafter under the new law. An adjustment in benefits may be necessary if you receive payments under the workmen's compensation (including occupational disease), unemployment compensation, or disability insurance laws of your State. If you return to workor you are working now-for wages of more than $175 a month and you are under age 72 for either all or part of this year, you should contact any social security office by telephone or mail. Notify us immediately if any of these events occurs. This action resulted from our reconsideration of your claim and replaces our previous determination. If you believe that the reconsideration determination is not correct, you may request a hearing before an Administrative Law Judge of the Bureau of Hearings and Appeals. If you want a hearing, you must request it not later than 6 months from the date of this notice. You should make any such request through any social security office. DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE, Social Security Administration. No. 0(7-63) BDI−223–(R)-11/72 Since there is an attorney of record in this case, a fee for his services may be charged. The Federal Coal Mine Health and Safety Act, as amended, requires an attorney to obtain authorization from the Social Security Administration before he may charge any fee for his services, and also provides that up to 25 percent of a claimant's past-due benefits can be used toward the payment of such fees. As the amount of his fee has not yet been authorized, we are withholding a preliminary amount of $1000.00 from your past-due benefits. When the amount of the fee is determined, it will be taken from the withheld funds and sent to your attorney; any remaining amount will be sent directly to you. If the authorized fee exceeds the amount withheld and is within the 25 percent limitation, we will have to recoup the additional amount from you. If the authorized fee exceeds 25 percent, payment of the balance of the fee is a matter that should be resolved between you and your attorney and does not involve the Social Security Administration. If your attorney has not yet done so, he should immediately file a petition for approval of a fee or notify the Social Security Administration if no fee is to be charged. DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE, Social Security Administration. No. 853 BL (12–72) DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE, SOCIAL SECURITY ADMINISTRATION-BUREAU OF DISABILITY INSURANCE, Baltimore, Md., February 23, 1973. NOTICE TO REPRESENTATIVE OF BLACK LUNG CLAIMANT DEAR MR. CRUM: We are informed that you have been appointed by the claimant to act as his representative in connection with his rights under the Federal Coal Mine Health and Safety Act. We will, therefore, be dealing directly with you on matters pertaining to his rights. Under the law you are required, after your services as representative have ended, to petition the Social Security Administration for approval of any fee that you wish to charge for your services. In evaluating a request for approval of a fee, the purpose of the black lung program will be considered together with other pertinent factors such as kinds of service performed, time spent in rendering these services, the complexity of the matter, etc. After the Social Security Administration authorizes a fee, the representative must look to the claimant for payment, except where the representative is an attorney at law and there are past-due benefits payable under Title IV of the Federal Coal Mine Health and Safety Act as a result of a favorable determination on the claim. In such cases, up to 25 percent of such past-due benefits will be paid direct to the attorney toward payment of the authorized fee. Such a payment may never exceed any amount that may have been agreed upon by the attorney and claimant as the fee for the attorney's services. Enclosed for your convenience is form SSA-1560 which you will need to petition the Social Security Administration for approval of the fee you wish to charge. Further information and instructions for completion are given on the form itself. Sincerely, C. C. HALL, Assistant Director. STATEMENT OF MARION HUBBARD, MINER, MANCHESTER, KY. My name is Marion Hubbard, I am 52 years old, married and I live at Route 4, Box 568, Manchester, Kentucky. I worked as an underground coal miner tipple worker for about 15 years, ending September 2, 1971. Before working in the coal industry, I worked in sawmills, lumber yards and laid track for railroads. I had to quit working on September 2, 1971, because of pain in my chest, shortness of breath and smothering. I have been very sick since quitting work. On August 9, 1971, I went to see Dr. T. H. Biggs at the State T.B. Hospital at the Clay County Health Department. I had been treated by Dr. Biggs in 1954 for T.B. He told me I had black lung. I went to see Neville Smith because he has represented my brother-in-law in a workmens compensation case, about 8 or 10 years ago, and I know he had the reputation of being honest. I also talked to one of my former employers who told me Neville Smith was the best lawyer I could get. I talked to Mr. Smith and he explained what was done in my state compensation claim and advised me about signing up for Federal black lung benefits. He had me examined by two doctors and gave me copies of the reports to be filled in for my Federal black lung claim. The Federal black lung claim was allowed, but Mr. Smith did not ask for a fee in that matter and said that he did not intend to do so. Even though I visited his office on quite a few occasions and sought his advise on that, I also filed for Social Security disability benefits, on the advise of Mr. Smith, and he handled that claim through the hearing in London, Kentucky, on April 26, 1973, and Social Security notified me that $409.62 had been withheld to pay my lawyer. Mr. Smith told me he did not intend to ask for that sum even though I thought it was fair for the efforts that he made for me. He asked for a fee of $100.00 to be approved by Social Security which was only for the travel to London and the time spent on that day. During this period of time, I applied for Welfare benefits and Mr. Smith helped me with that. He went to the hearing with me on November 3, 1971. That claim was denied and Mr. Smith prepared an appeal to the Circuit Court for me, but I decided not to have it filed. I did not have the money to have the necessary doctor examine me and Mr. Smith paid the doctor and stenographer. That was the only way I could get the bills paid, which amounted to $253.32. Mr. Smith, during this time, also advised me concerning other problems concerning my father. Furnished transportation to Louisville to see a doctor and saw me in his office on many occasions. When the workmen's compensations case was final, I felt that the fee allowed by the workmens compensation board to Mr. Smith was fair and I am very satisifed with the handling of my workmen compensation case as well as the other matters which Mr. Smith handled for me without charge. I never knew a man that was more honest than Mr. Smith. STATEMENT OF MR. BILL WORTHINGTON, PRESIDENT, KENTUCKY BLACK LUNG ASSOCIATION My name is Bill Worthington of Harlan, Kentucky. I am President of the Kentucky Black Lung Association, a statewide organization of active and disabled miners. I appreciate the opportunity to present testimony to the Subcommittee. I will confine my remarks to the subject of attorneys' fees paid pursuant to claims made for benefits to individuals suffering from Black Lung disease, under both state and federal laws. I am opposed to the present scheme of determining attorney fees solely on the basis of a fixed percentage of the claimant's award and then deducting that amount from the award. I recognize in some cases there may be a need for a capable and experienced attorney to represent the claimant and in those cases I believe the attorney should be adequately compensated for his services. However, I would urge that the standards used in determining the amount paid attorneys should not be a fixed percentage of the award. Rather, I believe compensation should be on an hourly basis and supported by the evidence in each particular case, reflecting the circumstances of each individual claim. The power of courts and administrative agencies to award fees should not be exercised in an arbitrary and capricious manner, but should be based upon a finding of the skill, effort, and effectiveness of each attorney in each case. It must be remembered that the purpose of state and federal legislation providing benefits for Black Lung cases is to bring justice and equity to those miners who worked for years in unhealthy conditions, to their families and their survivors. The statutes prescribing a maximum percentage fee for attorneys representing claimants reflected a legislative intent to protect claimants from paying exorbitant fees and arose from legislative concerns about the unethical practices of some lawyers handling disability cases. The purpose of these laws most certainly was not to create a gold mine for lawyers. But this original purpose has been thwarted. The present system of awarding attorneys fees has produced evils as serious as those existing when the laws were passed. In Kentucky, the maximum percentage award is given in nearly 75% of the cases, with little consideration to the actual time and effort spent on a case. Officials have closed their eyes to the fact that some attorneys use assembly line, heavy-volume methods to prosecute claims which reveal little attention to the cases. If there is any standard by which these high fees are justified, it seems to be that some attorneys are skillful at assembling thick file folders with redundant and superfluous medical reports. One result of this system is that the claimant has deducted from his award a substantial sum of money which in no way reflects the actual service rendered to him by the attorney. But, in addition to this individual effect, the system has a more widespread and pervasive impact on public welfare. It is an incentive to procrastination and dilatory tactics by lawyers in these cases, since it minimizes the desire to do competent, efficient work. It fails to provide any effective safeguards for protection of clients and assurance to them of high quality legal services. Moreover, as a practical matter, the system tends to produce price uniformity among lawyers and an overvaluation of the services provided by lawyers, both traditionally regarded as evils in our free enterprise system. The policy of administering attorney fees in these cases can also inhibit attorneys who might be willing to handle cases for smaller amounts, since attorneys who deviate from traditionally rigid minimum fee schedules may risk disciplinary action for solicitation. While it might be suggested that this situation is the result of a deliberate governmental policy to regulate fees, it still remains true that the state has not provided any mechanism to protect against abuses resulting from the policy. I would urge that instead of the present system, attorneys be paid on an hourly basis in prosecuting black lung claims and that the standards for determining fees be similar to those customarily applied in regular law practice. Among these standards are: (1) Character of the service, (2) Nature and importance of the case, (3) Skill and experience required, (4) Professional standing of the attorney, (5) Extent to which the case detracts from other cases, and (6) Results achieved. 24-625 0-74-22 Finally, I urge that regardless of how the attorney fees are determined, they should not be deducted from the claimant's award. Rather they should be assessed against the funds out of which claims are paid generally. The laws providing these benefits reflect a social policy of compensating miners for injuries and disease resulting from conditions over which they had no control. To diminish these benefits by requiring large attorney fee payments, especially fees which are unreasonable, not only penalizes miners unjustly, but shifts from another part of society the burden they should in justice carry. Senator TUNNEY. We will then resume our hearing at 2:40. Mr. Nelson will be our first witness; Mr. Yocum, the commissioner of labor of Kentucky will be our next witness; and then Mr. Denham, president of the Kentucky bar. [Whereupon, at 1:20 p.m., the subcommittee recessed, to reconvene at 2:40 p.m., the same afternoon.] AFTERNOON SESSION Senator TUNNEY. Our next witness is Mr. Robert Nelson, director of Legislative Department, United Mine Workers, testifying on behalf of Arnold Miller, president of United Mine Workers. STATEMENT OF ROBERT R. NELSON, DIRECTOR, LEGISLATIVE DEPARTMENT, UNITED MINE WORKERS, ON BEHALF OF ARNOLD MILLER, PRESIDENT, UNITED MINE WORKERS OF AMERICA Mr. NELSON. Thank you, Mr. Chairman, Senator Cook. My name is Robert Nelson and I am director of the Legislative Department, the United Mine Workers of America. First, Mr. Chairman and Senator Cook, I would like to express the regrets of the United Mine Workers President Arnold Miller that he cannot be here today. When he first learned of these hearings he was very pleased and enthused about the decision of this subcommittee to look into the matter of legal fees and representation and in general the administration of the black lung program. As you know, I am sure you are aware, the UMW these days is undergoing a good deal of reform and reorganization. I can assure you, were it not for a major matter today that called for Mr. Miller to be at his office, he would be here. In his stead, I have been authorized to deliver to the committee his statement. I would like to proceed and rather quickly read the statement, summarizing it. Senator TUNNEY. Please do. Mr. NELSON. Let me begin by stating the position of the UMWA that no disabled coal miner ought to have to pay out one penny of his black lung benefits check, or for that matter, his Social Security check or his workmen's compensation check for attorney's fees. Under the present system, every penny of attorneys' fees paid under the black lung program comes directly out of the compensation checks intended by Congress for disabled coal miners, or their widows and orphans. These benefits are, in most cases, extremely low when measured in terms of the human suffering for which they are intended to compensate. Any time it becomes necessary for a working man or his family to hire an attorney to win benefits he has |