Published: October 28, 2011 New York Times
More than half of the Long Island Rail Road workers who retired last year applied for federal disability benefits, a rate far higher than the national average, even as federal officials and prosecutors tried to stem a chronic pattern of abuse of the public benefits system by the railroad’s retirees.
While the number of disability claims filed by the railroad’s workers has fallen since the abuses came to light in 2008, the sheer volume of applications remained conspicuously higher than those from any other train system in the country, including the Metro-North Railroad, which is comparable in size.
Furthermore, nearly all of the claims — 95 percent over the past three years — continued to be approved by the Railroad Retirement Board, the federal agency that is the equivalent of Social Security for railroad workers.
The agency’s officials had promised to use greater oversight in assessing disability claims from employees of the Long Island Rail Road.
Eleven people were charged on Thursday in Federal District Court in Manhattan with a huge fraud scheme. Most were retirees from the railroad who, prosecutors said, collected tens of thousands of dollars a year after claiming they had disabling pain; they had been observed playing tennis or golf, bicycling up to 400 miles or doing aerobics for hours.
Those charged included two doctors who ran “disability mills,” producing false assessments for the workers, prosecutors said. Each faces a maximum of 20 years in prison if convicted, and all have been released, some on bail and some on their own recognizance.
Prosecutors said they brought charges in only the most egregious cases. One defendant, Gregory Noone, 62, received more than $100,000 annually in disability and pension payments after claiming that he experienced sharp pains when handling objects or crouching. But investigators observed him over nine months playing dozens of rounds of golf and several hours of tennis each week, prosecutors said.
All told, more than $120 million has been paid to hundreds of workers whose disabilities may have been exaggerated, and counting future payments, prosecutors said, the total could reach $1 billion. Prosecutors could seek to reclaim payments from defendants who are convicted, but it would be up to the Railroad Retirement Board to stop payments or try to recover money from retirees who are not being prosecuted.
On Friday, the general counsel of the Railroad Retirement Board, Steven A. Bartholow, said he had no comment on the matter.
Later, an agency spokesman, Michael P. Freeman, wrote in an e-mail that in any case of proven fraud, previously paid benefits would be “subject to recovery” and benefits would be cut off. But he declined to say whether the agency would conduct any type of internal review.
After The New York Times reported in 2008 that virtually every employee of the Long Island Rail Road had applied for and received federal benefits for occupational disability, the retirement board said it would enact new measures to protect against fraudulent claims.
Mr. Freeman said that claims from the railroad’s retirees had fallen nearly in half since 2007. Of 189 workers who retired last year, 110 applied for occupational disability benefits, according to figures provided by the railroad. But that proportion of applicants “would still be considered unusually high,” said Dr. J. Mark Melhorn, whose books on occupational injuries have been published by the American Medical Association.
“It raises concern as to why the number is that high,” Dr. Melhorn said. Disability rates for railroads typically range from 20 percent to 40 percent.
Officials at two major Long Island Rail Road unions did not respond to requests for comment on Friday.
The railroad itself does not administer federal disability pensions, but its president, Helena E. Williams, said Friday that evidence of wrongdoing could result in a reduction to the retirees’ state-level benefits.
Ms. Williams noted that the railroad had modified its ethics training for employees and prohibited workers from counseling one another about federal pension applications.
The railroad also expanded its own pension office and asked to add a representative to the leadership of the Railroad Retirement Board, a request that was not met.
A version of this article appeared in print on October 29, 2011, on page A17 of the New York edition with the headline: Despite Attention to Abuses, Disability Filings at the L.I.R.R. Remain High.