[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]
CLEARING THE DISABILITY CLAIMS BACKLOGS:
THE SOCIAL SECURITY ADMINISTRATION'S PROGRESS AND NEW CHALLENGES
ARISING FROM THE RECESSION
=======================================================================
HEARING
before the
SUBCOMMITTEE ON SOCIAL SECURITY
of the
COMMITTEE ON WAYS AND MEANS
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED ELEVENTH CONGRESS
FIRST SESSION
__________
NOVEMBER 19, 2009
__________
Serial No. 111-38
__________
Printed for the use of the Committee on Ways and Means
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COMMITTEE ON WAYS AND MEANS
CHARLES B. RANGEL, New York, Chairman
FORTNEY PETE STARK, California DAVE CAMP, Michigan
SANDER M. LEVIN, Michigan WALLY HERGER, California
JIM MCDERMOTT, Washington SAM JOHNSON, Texas
JOHN LEWIS, Georgia KEVIN BRADY, Texas
RICHARD E. NEAL, Massachusetts PAUL RYAN, Wisconsin
JOHN S. TANNER, Tennessee ERIC CANTOR, Virginia
XAVIER BECERRA, California JOHN LINDER, Georgia
LLOYD DOGGETT, Texas DEVIN NUNES, California
EARL POMEROY, North Dakota PATRICK J. TIBERI, Ohio
MIKE THOMPSON, California GINNY BROWN-WAITE, Florida
JOHN B. LARSON, Connecticut GEOFF DAVIS, Kentucky
EARL BLUMENAUER, Oregon DAVID G. REICHERT, Washington
RON KIND, Wisconsin CHARLES W. BOUSTANY, JR.,
BILL PASCRELL, JR., New Jersey Louisiana
SHELLEY BERKLEY, Nevada DEAN HELLER, Nevada
JOSEPH CROWLEY, New York PETER J. ROSKAM, Illinois
CHRIS VAN HOLLEN, Maryland
KENDRICK B. MEEK, Florida
ALLYSON Y. SCHWARTZ, Pennsylvania
ARTUR DAVIS, Alabama
DANNY K. DAVIS, Illinois
BOB ETHERIDGE, NORTH Carolina
LINDA T. SANCHEZ, California
BRIAN HIGGINS, New York
JOHN A. YARMUTH, Kentucky
Janice Mays, Chief Counsel and Staff Director
Jon Traub, Minority Staff Director
______
SUBCOMMITTEE ON SOCIAL SECURITY
JOHN S. TANNER, Tennessee, Chairman
EARL POMEROY, North Dakota SAM JOHNSON, Texas, Ranking Member
ALLYSON Y. SCHWARTZ, Pennsylvania KEVIN BRADY, Texas
XAVIER BECERRA, California PATRICK J. TIBERI, Ohio
LLOYD DOGGETT, Texas GINNY BROWN-WAITE, Florida
RON KIND, Wisconsin DAVID G. REICHERT, Washington
JOSEPH CROWLEY, New York
LINDA T. SANCHEZ, California
JOHN A. YARMUTH, Kentucky
Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public
hearing records of the Committee on Ways and Means are also published
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C O N T E N T S
__________
Page
Advisory of November 12, 2009 announcing the hearing............. 2
WITNESSES
The Honorable Bob Filner, a Representative in Congress from the
State of California............................................ 6
______
The Honorable Michael J. Astrue, Commissioner, Social Security
Administration................................................. 11
______
The Honorable Barbara B. Kennelly, Acting Chair, Social Security
Advisory Board................................................. 86
Beth Bates, Claimants' Representative, on behalf of the
Consortium for Citizens with Disabilities, Jackson, Tennessee.. 91
The Honorable Patrick O'Carroll, Inspector General, Social
Security Administration........................................ 106
Ann P. Robert, Vice President, National Council of Disability
Determination Directors, Springfield, Illinois................. 110
The Honorable Larry A. Auerbach, Administrative Law Judge, on
behalf of the Federal Bar Association, Atlanta, Georgia........ 114
SUBMISSIONS FOR THE RECORD
Council of State Administrators of Vocational Rehabilitation..... 170
Corporation for Supportive Housing Advocacy and Training Center.. 180
Council of State Administrators of Vocational Rehabilitation..... 182
Eunmi Choi, statement............................................ 189
Ibrahim Dere, statement.......................................... 194
James F. Allsup, statement....................................... 201
Leri Harper, statement........................................... 203
National Council of Social Security Management Associations, Inc. 205
Social Security Disability Coalition............................. 207
The Huntington's Disease Society of America...................... 220
CLEARING THE DISABILITY CLAIMS
BACKLOGS: THE SOCIAL SECURITY
ADMINISTRATION'S PROGRESS AND NEW
CHALLENGES ARISING FROM THE RECESSION
----------
THURSDAY, NOVEMBER 19, 2009
U.S. House of Representatives,
Committee on Ways and Means,
Subcommittee on Social Security,
Washington, DC.
The Subcommittee met, pursuant to notice, at 1:54 p.m., in
Room B-318, Rayburn House Office Building, the Honorable John
S.
Tanner [Chairman of the Subcommittee] presiding.
[The advisory announcing the hearing follows:]
HEARING ADVISORY FROM THE COMMITTEE ON WAYS AND MEANS
Subcommittee on Social Security Chairman
Tanner Announces a Hearing on Clearing the
Disability Claims Backlogs: The Social Security
Administration's Progress and New Challenges Arising From the Recession
November 12, 2009
By (202) 225-9263
Congressman John S. Tanner (D-TN), Chairman, Subcommittee on Social
Security of the Committee on Ways and Means, today announced a hearing
on Clearing the Disability Claims Backlogs: The Social Security
Administration's Progress and New Challenges Arising From the
Recession. The hearing will take place on Thursday, November 19, 2009
in Room B-318, Rayburn House Office Building, beginning at 1:30 p.m.
BACKGROUND:
This hearing continues the Subcommittee's examination of the Social
Security Administration's (SSA) efforts to reduce its unprecedented
backlog in disability claims. Due in part to prolonged underfunding,
the backlog of disability appeals hearings grew significantly in recent
years. By December 2008, more than 768,000 Americans were waiting for a
hearing decision--a historic high. Total waiting times for a decision
on a claim can extend to three or four years, and testimony before the
Subcommittee has included personal stories of those who have lost their
homes, depleted life savings, or even died while awaiting a decision.
In FY 2008 and 2009, Congress provided SSA with additional
administrative funding to begin to reduce the hearings backlog and
address other service delivery shortfalls. This allowed SSA to hire
additional Administrative Law Judges (ALJ) and hearing office support
staff. SSA has also made eliminating the hearings backlog a top agency
priority and has taken measures to increase efficiency and
productivity. All of these changes have had an impact: since January
2009, the hearings backlog has begun to slowly decline, and dropped
below 723,000 by the end of the fiscal year.
SSA is facing new challenges due to the recession, however, that
are threatening backlog reduction efforts. In FY 2009, incoming
disability claims increased by nearly 15 percent. Incoming claims are
projected to increase by an additional 12 percent in FY 2010 and
continue at elevated levels through 2013. Congress provided additional
funding for FY 2009 and 2010 in the American Recovery and Reinvestment
Act of 2009 (P.L. 111-5) to help SSA process these increased claims.
Even with this funding, however, the capacity of the state
Disability Determination Services (DDS)--which process initial
disability claims--cannot be expanded quickly enough to keep up with
such steep claims increases. This problem is made worse because a
number of states have instituted hiring freezes or furloughs for state
employees as a way to address state budget shortfalls, and have not
exempted DDS employees even though the DDSs are completely federally
funded. As a result, SSA now projects that by the end of FY 2010, more
than one million Americans will be awaiting a decision an initial
disability claim, up from about 567,000 at the end of FY 2008. The
increase in initial claims also affects the DDSs' capacity to process
reconsideration appeals and conduct continuing disability reviews,
which are important to program integrity.
The steep increase in new disability claims will also result in
more appeals to the hearing level that will challenge the capacity of
SSA's hearing offices in the next several years. Without sufficient
resources in FY 2011, SSA will not be able to stay on track to
eliminate the hearings backlog by 2013 while also addressing the
emerging DDS backlog and processing the large volume of claims
anticipated in FY 2011.
In announcing the hearing, Social Security Subcommittee Chairman
Tanner said, ``I am very pleased to see that Congress' commitment to
reducing the Social Security Administration's backlog is finally
resulting in an overall decline in pending disability hearings. I
commend SSA and its hardworking employees for the success of their
efforts. However, SSA is now facing large increases in disability
claims due to the recession, and this is threatening to undo the hard-
won progress we have made. The rapidly growing backlog at the initial
claims level is a particularly serious concern. I am committed to
ensuring that SSA aggressively addresses these problems, and that the
agency has the tools to ensure that Americans who are in dire need of
disability benefits can receive prompt consideration of their claim.''
FOCUS OF THE HEARING:
This hearing will focus on the effect of SSA's unprecedented
backlog in disability claims on applicants with disabilities, and the
agency's efforts to address these challenges, including SSA's recent
progress in reducing its hearing backlog and its plans for addressing
the emerging backlog at DDSs. The hearing will also examine the impact
of the recession on disability claims processing, including projected
claims increases, and the need for adequate resources to reduce the
backlogs and adjudicate recession-driven claims.
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Chairman TANNER. In the interest of time we will begin now.
There will be another series of votes in about an hour, is that
correct? So we will start.
Thank all of you for being here. This hearing is both
timely and important, as you know. Our hearing today focuses on
the oversight of the Social Security Administration's efforts
to reduce an unprecedented backlog in disability claims. The
backlog works a severe hardship, as many of you know, on those
who are waiting. I know that all Members have heard from
constituents about it.
There is some good news. The hearing backlog has begun to
decline from 768,000 to 718,000, partly because of our
investment last year that could have been considered overdue.
The bad news is the recession is threatening to overtake what
gains we have been able to make in the backlog.
The further complicating problem, of course as you know, is
the state Disability Determination Services (DDS). Some are
being furloughed, and some are cutting back. As far as I know,
none are being enlarged to deal with this, and so, as it
relates to the backlog and to the credibility of the program,
the continuing disability reviews, it's clear we have a
problem. So, in this hearing we are going to try to highlight
some things that will help.
We are delighted that we are able to have this hearing now,
because we think it's very, very timely.
[The prepared statement of Mr. Tanner follows:]
Prepared Statement of Chairman Tanner
Today's hearing continues the Subcommittee's ongoing oversight of
the Social Security Administration's (SSA's) efforts to reduce its huge
and unprecedented backlog in disability claims. In 2000, there were
about 310,000 Americans awaiting a hearing on a disability claim. By
December 2008, that number had more than doubled, reaching 768,000--a
historic high. This has led to long wait times for applicants,
sometimes as long as three or four years.
Because applicants often have little or no income while awaiting a
decision on benefits, the backlog has caused severe hardship to
hundreds of thousands of Americans with significant disabilities. We
will hear some of their stories today. We also hear about this issue
every day from our own constituents in Tennessee who are often in
desperate need.
Today we have good news and bad news to report. First, the good
news. After many years of growing backlogs in SSA's hearing offices, we
have finally turned a corner. Since the beginning of 2009, the hearings
backlog has begun to slowly decline, and is now down to 718,000. This
shows that Congress' investment in SSA is starting to pay off. The
Subcommittee particularly wants to commend all the dedicated SSA
employees who have contributed to this success.
The bad news, however, is that this hard-won progress is now being
threatened. Due to the recession, new disability claims have increased
significantly. From FY 2008 to FY 2009, these claims increased by
almost 15 percent, and they are projected to increase by another 12
percent in FY 2010, and to continue at higher levels for several years.
Congress recognized the need to address this problem last year when
it provided funds in the American Recovery and Reinvestment Act to help
SSA process additional recession-driven claims in FY 2009 and 2010. But
even with this funding, the state Disability Determination Services
(DDSs), which make decisions on initial disability claims, cannot
expand their capacity quickly enough to handle this very large,
unexpected workload. This problem has been made worse because a number
of states have instituted hiring freezes or furloughs for state
employees and have not exempted DDS employees, even though the DDSs are
completely funded by SSA.
As a result, another severe backlog is emerging, this time at the
initial claims level. By the end of FY 2010, an astonishing 1 million
Americans will be awaiting a decision on their initial disability
claims--nearly double the number that were waiting just two years
before. The initial claims backlog has already topped 780,000
nationwide--a 35 percent increase from this time last year. In my own
state of Tennessee, we have seen an even bigger increase, with the
initial claims backlog increasing by more than 60 percent since last
year.
And because the same DDS employees who evaluate initiate claims
also perform continuing disability reviews (CDRs) to determine if
current beneficiaries remain eligible, the DDS backlog also poses
serious challenges to SSA's program integrity efforts. SSA has fallen
far behind in conducting CDRs, even though these reviews have been
demonstrated to generate considerable savings.
This situation is clearly unacceptable. SSA has expressed its
commitment to addressing the DDS backlog problem, and I understand that
today the SSA Commissioner will present to us his plan for expanding
the agency's capacity to process initial claims. I look forward to
hearing it.
Just as alarming is the potential impact of these recession-driven
claims on SSA's hearings backlog. The claims increases the DDSs are now
seeing will soon result in increased appeals to the hearing level. If
SSA's hearing offices do not have the resources to handle this added
workload while still tackling the existing backlog, SSA will not be
able to fulfill its goal of eliminating the hearings backlog by the end
of FY 2013. In fact, the hearings backlog could begin to rise again.
All of this adds up to very significant challenges for SSA in FY
2011. The agency will be faced with three difficult tasks. First,
because the impact of the recession on claims is expected to continue,
to keep up with incoming claims, SSA will need to process a much higher
number of claims than the agency has in the past. Second, it is
imperative that SSA begin reducing the initial claims backlog, which by
FY 2011 will have reached more than 1 million. Third, we cannot afford
to let the hearings backlog reduction plan falter. We must stay on
track with this plan's targets even though the recession will bring
increased appeals to SSA's hearings offices.
Today we should pause to celebrate the progress that is being made.
But we also need to prepare to move forward with even more conviction.
I look forward to hearing about SSA's plans for meeting these
challenges. And I look forward to the insights of our other witnesses
about what is needed--from Congress and from the Administration--to
ensure that we do not backslide.
Millions of Americans pay Social Security taxes every year with the
promise that if they become severely disabled, Social Security will be
there for them. But the lengthy delays many face when they apply for
benefits means that we now are falling short on that promise. I am
committed to ensuring that these problems are addressed, so that
Americans who apply for disability benefits can receive timely
consideration of their cases.
Chairman TANNER. Congressman Filner, thank you for coming.
We appreciate your interest in this subject today. I have
assurance that Mr. Johnson is on his way, so, in the interest
of time, I would like to go ahead and recognize you for the
purpose of hearing your testimony. If any of our Members have
an opening statement, I would ask unanimous consent that it be
placed in the record.
Mr. Filner, you are recognized, sir.
STATEMENT OF THE HONORABLE BOB FILNER, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF CALIFORNIA
Mr. FILNER. Thank you, Mr. Chairman. I appreciate the
opportunity to be here, and your timeliness in holding this
hearing. As bad as those backlog statistics that you mentioned
are, I think that certainly in my state of California, the
backlog may be understated, due to several policies in
California that are being implemented, to hide that backlog. I
think we need to take action on that.
You guys have, I think, all read the Inspector General
reports, and he is going to--he is here today. On March 24th,
he testified before the Subcommittee that since January 1st of
this year, California's initial claims pending have increased
by 9.7 percent, and its reconsideration claims pending by 6.1
percent, as a result of the increased applications and state
furloughs.
Unfortunately, since the March 24th Subcommittee hearing,
the situation has continued to deteriorate, in California
especially, now that the California Disability Determination
Services workers are furloughed three days a month.
In a report, in fact just released yesterday, a review by
the inspector general shows that the rate of increased
applications continued to grow through fiscal year 2009,
totaling about 15 percent above the previous year. The growth
in new claims has outpaced the DDSs ability to keep up with the
new workload.
By the end of fiscal 2009, the number of initial cases
pending had grown, as you said, to almost 770,000, about 38
percent higher than the end of fiscal year 2008. Social
Security plans to spend $2 billion in fiscal year 2010 on DDS
operations, and expects the DDSs to process almost 4 million
claims.
But state furloughs have had an effect on that ability to
process. There are nine states, as I understand it, furloughing
or considering furloughing the DDS employees for fiscal year
2010, which will result in a significant shortfall of capacity.
The OIG expects approximately 69,000 disability cases to be
delayed in processing over the next year.
This wait will result in about $162 million in benefits
that will not be paid to disabled beneficiaries during this
period that would have been paid, had the furloughs not
occurred, and, of course, these states will lose over $39
million in Administration funding from Social Security because
the employees are furloughed.
Now, what doesn't show up in the statistics--in fact, I
believe there is a deliberate attempt in California to hide the
impact of the furloughs--for example, prior to the furloughs,
DDS assigned all initial and reconsideration cases to line unit
examiners within 24 to 48 hours. In September 2009, California
DDSs began, as they call, staging initial and reconsideration
claims.
What this meant was the assigning of a case to a fictional
examiner. Those cases are, in essence, a backlog although I
don't think they're counted in a backlog. Those cases are
simply set aside with no development initiated, until some
later point, when they can be assigned to a real person.
California has, in just the last two months, has a staged
case category of 15,000 cases. The increased backlog and
decreasing work hours because of the furlough have also led to
California DDS reinterpreting a Federal regulation that allows
cases to be closed, and denied when a claimant fails to pursue
or cooperate with the processing of their claim. This is a
change in the state DDS policy from the pre-furlough situation.
Employees of California DDS have been instructed to close
and deny claims for disability benefits if, within 20 days of
receiving the case, if the claimant fails to complete and
return a long, detailed form known as a function report. This
form has a supplement which requires the claimant to find a
third party to complete a portion of the form. This is a 25-
page form, and if it's not in the file case within 20 days, the
DDS workers are pressured to close and deny the case without
any further case development.
So, the statistics show ``case closed.'' This is despite
the fact that the very nature of these disabilities--they can't
complete the task in 20 days. These forms are sent to homeless
claimants, cancer patients, illiterate claimants, even blind
claimants. Their inability to complete these forms is resulting
in denial of benefits without a substantive disability
determination. This is criminal, in my view.
And, under the pre-furlough days, the workers would go out
and help the people develop their claims, help them with this
25-page form. One branch--and I have talked to people in
branches all over the state, by the way, Mr. Chairman, I would
be happy to provide documentation to your staff of the
situation--one branch in Northern California reported that 30
percent of their cases had been closed in this manner. Another
California branch, an internal quality review, showed that the
quality was at 60 percent, meaning 40 percent of the cases
reviewed contained significant errors.
A study of the last three fiscal years on quality reveals a
significant decline in case accuracy. Since the inception of
the furloughs, the quality has twice dipped below the Federal
minimum threshold of 90 percent.
Mr. Chairman, I think the Social Security Administration
has some recourse in this. They have asked governors not to do
the furloughs. By the way, the furloughs do not save money. Let
me make sure everybody understands that. If you furlough a case
worker, the Federal pay is just not made. The state doesn't
save any money. In fact, the state loses its administration fee
for that.
We have begged Governor Schwarzenegger to not do it, but he
apparently wants all the workers through the state to be
furloughed together, even though it doesn't save them any
money, it's costing, I think, thousands of claimants to lose
their beneficiary.
I have written a bill, Mr. Chairman, which I will introduce
shortly, which tries to deal with the situation. Current
Federal law allows the Social Security Administrator to
federalize DDS employees if a state ``substantially fails'' to
live up to its responsibility to process claims. My bill, the
Don't Delay Services Act, is intended to prevent the state
furloughs in this situation. My bill would deem furloughs of
DDS employees a substantial failure, triggering the provision
of existing Federal law that allows SSA to federalize DDS.
There are some costs and other implications of that. But I
think it ought to be studied, get the cost figures, and tell
the states that if they don't do this properly, they're going
to be federalized. I hope the committee will look at that
legislation.
I appreciate the opportunity to be here today.
[The prepared statement of Mr. Filner follows:]
Prepared Statement of The Honorable Bob Filner,
A Representative in Congress from the State of California
Mr. Chairman, Thank you for allowing me to testify today before the
House Ways and Means Subcommittee on Social Security. I appreciate the
opportunity to tell the Subcommittee Members about how state furloughs
are impacting my home state of California. I am also interested in
letting you know about legislation that I will soon introduce to
address this issue.
I understand that the Subcommittee has held hearings on this
important issue already. In March, you heard from many distinguished
witnesses, including the Social Security Administrator, Michael Astrue,
and Inspector General, Patrick O'Carroll.
As you know, Mr. O'Carroll has written several reports about the
impact of state furloughs and hiring freezes on disability claims
processing. On March 24th, he testified before the Subcommittee that:
``Since January 1, 2009, California's initial claims pending have
increased by 9.7 percent and its reconsideration claims pending by 16.1
percent as a result of increased applications and the State
furloughs.'' Unfortunately, since the March 24th Subcommittee hearing,
the situation in California has only gotten worse.
While some states have exempted Disability Determination Service
(DDS) employees from the furloughs at the urging of the Social Security
Administration, the State of California has not exempted DDS employees.
This is despite the fact that DDS employee salaries are fully funded by
the Federal Government.
The unnecessary furloughs for California DDS employees are pushing
back the decisions on individuals' benefits by months and harming
thousands of disabled residents who are needlessly waiting for their
claims to be processed. A new report issued by the Inspector General
estimates that 53,136 cases will be delayed in 2009 as a result of the
State of California's furloughs!
The furloughs are also impacting state DDS employees by reducing
their salaries, making it harder for families to make ends meet. Since
July 10th, State of California employees have been furloughed 3 days
per month for a total of at least 36 days in 2009. These 3 furlough
days translate to an approximate 13.8% reduction in monthly pay.
Finally, furloughing DDS employees is actually making the State of
California's budget crisis worse because the state has to pay benefits
until the federal claim is approved and the state if forgoing income
tax revenue from furloughed employees.
Governor Schwarzenegger's insistence on furloughing DDS employees
is not helping the people of California, not helping the State of
California solve its budget crisis, and is simply an indefensible and
illogical policy!
Earlier this year, the Social Security Inspector General released a
report outlining several options for addressing the crisis, including
working with States to stop DDS furloughs, transferring work to other
disability examiners and/or hiring private contractors, and
federalizing the DDS.
To date, Vice President Biden and others have succeeded in working
with many states to ensure that DDS employees are exempted from
furloughs. Unfortunately, the State of California and other states have
ignored the facts and continue to furlough DDS employees.
That is why I think it is time for Congress to consider other
options to stop the state furloughs.
Current federal law allows the Social Security Administrator to
federalize DDS employees if a state ``substantially fails'' to live up
to its responsibilities to process claims. I will soon introduce The
Don't Delay Services Act, which is intended to prevent state furloughs
of DDS employees.
My bill would deem furloughs of DDS employees a ``substantial
failure,'' triggering the provision of existing federal law that allows
SSA to federalize DDS. As drafted, the Don't Delay Services Act would
not change any provisions of federal law concerning the rights and
protections of these workers.
I understand that federalizing DDS employees is not a perfect
solution. However, in passing the legislation, Congress would be
sending a wake-up call to Governor Schwarzenegger. As the Subcommittee
continues to work to eliminate the disability claims processing
backlog, I hope the Subcommittee will consider my bill.
Thank you again for allowing me to testify before the Subcommittee.
Chairman TANNER. Thank you, Mr. Filner. We will take your
testimony to heart and under advisement, and we will be back
with you.
Mr. FILNER. I thank you. Again, I have documentation for
your staff of this.
Chairman TANNER. If you could give that to the Subcommittee
staff, that would be great. Thank you very much.
Mr. Johnson, in the interest of time we decided to hear Mr.
Filner's testimony. Would you like to give your opening
statement
now?
Mr. JOHNSON. Can I?
Chairman TANNER. Yes, sir. Absolutely, you can.
Mr. JOHNSON. Thank you, Mr. Chairman. You know, Republicans
and Democrats alike on this committee have long worked together
to make sure Social Security has the resources it needs to
effectively administer their benefit programs. During the last
two fiscal years, Social Security received funding at levels
higher than the President's request, along with an additional
$1 billion to build a new computer system center, and to
process rising numbers of claims for disability benefits.
Today, Social Security is going to, again, report to
taxpayers what return they are getting on their money. Here, we
will see some long overdue good news on the appeals front.
Hearing offices have increased productivity, and this has
resulted in lower wait times for those who have been waiting
well over a year for a decision.
Beyond addressing today's service delivery challenges,
lasting returns on investment depend on Social Security
modernizing its technology, infrastructure, and consistently
addressing program waste, fraud, and abuse, including
conducting continuing disability reviews in order to save
billions in program dollars and build taxpayer confidence. So,
I will be listening for real progress in those areas.
Although clearing disability backlogs is important, today
marks the fourth hearing of this Subcommittee this Congress,
and the third hearing on backlogs, while we continue to ignore
the fiscal challenges that Social Security faces. In August,
the Congressional Budget Office reported that Social Security
cash surpluses will turn into cash deficits in the next two
years, and that the disability insurance trust fund will be
unable to pay full promised benefits in just nine years.
President Obama expressed his commitment to advance Social
Security reform, and we know the sooner we act, the better it
is.
Further, we have had no hearings on other key agency
challenges, including the ongoing problem of identity theft and
Social Security number misuse by those attempting to work
illegally in this country. I hope this committee will turn to
those issues, on a bipartisan basis, as soon as possible, and
examine the options for change and solutions.
I thank the witnesses for joining us today, and thank you,
Mr. Chairman, for allowing me to make this comment.
[The prepared statement of the Honorable Sam Johnson
follows:]
[GRAPHIC] [TIFF OMITTED] T3016A.001
Chairman TANNER. Yes, sir. Thank you. Our second panel is
the Commissioner, Mr. Astrue, who was sworn in on February 12,
2007 for a 6-year term. Commissioner, you have a long biography
here, a highly successful biotechnology lawyer, I see. I don't
know, maybe we could use some expertise around here, but,
anyway, we're delighted you're here. Without any further ado, I
will recognize you, sir, and, if I may, ask for your complete
statement to be put in the record. If you could hold your oral
comments to five minutes, we would appreciate it.
STATEMENT OF MICHAEL J. ASTRUE, COMMISSIONER,
SOCIAL SECURITY ADMINISTRATION
Mr. ASTRUE. Yes, Mr. Chairman. I have a longer statement
for the record, and I will make a brief oral statement.
Mr. Chairman, Mr. Johnson, Members of the Subcommittee,
thank you for this opportunity to discuss our progress in
driving down the hearings backlog and in managing the emerging
backlog at the DDSs.
Overall, the news is good. For my first 22 months, we
steadily reduced the rate of increase in pending hearing cases.
We hit the turning point this past January. In every month
since then, the number of pending cases has dropped. The rate
of decline is accelerating in the last three months, we reduced
the hearings backlog by a greater percentage than we did in the
previous seven months.
We have steadily reduced the number of cases that have
waited the longest. In fiscal year 2007, we started by
resolving virtually all 65,000 cases pending over 1,000 days.
This fiscal year we are ahead of schedule in resolving over
135,000 cases pending 825 days or longer.
Mathematically, our targeted effort with older cases meant
that average processing time remained artificially high for a
while, but that figure is also starting to drop now. Since
June, we have kept it below 500 days, and last month it was 446
days.
Moreover, the average processing time for our most
backlogged offices is coming down faster than for other
offices. In February 2007, the average processing time for
Atlanta was 852 days, and we had 6 offices with processing
times between 650 and 820 days. Last month, our most backlogged
office was Dayton, at 651 days.
Let me be clear that 651 days for a hearing is not
acceptable, but shortly, such performance will be a disturbing
piece of history. By the middle of next year, seven new offices
will open in Michigan, Ohio, Georgia, North Carolina, and
Indiana, our five most congested states. With plans for 25 new
hearing offices, 7 new satellite offices, and scores of office
modifications and expansions, we are adding the capacity for
the cases that continue flooding in.
Our hearing offices should also be very proud of their
three consecutive years of greatly improved productivity.
Without that achievement, we would not have reduced the backlog
this past year.
We have a number of ways to track productivity, but an
important bottom-line measure is the percentage of
Administrative Law Judges who reach our expectation for a
minimum annual disposition of 500 cases. That number is
steadily increasing each year. In 2007, 46 percent of our
judges reached that level. In fiscal year 2009, 71 percent
reached that level. That individual success is also a team
success. Each judge now receives support from a recent high
average of 4.6 support staff per judge.
Success comes from hard work, better systems, better
training, and better business processes. We designed National
Hearing Centers to quickly help the most beleaguered offices.
More and more applicants in remote locations are asking for
video hearings, which are not only more efficient, but also
more professional for judges and applicants than holding
hearings in motels or other makeshift places.
Improvements at the DDSs also help with backlog reduction.
We are fast-tracking more cases for approval in a matter of
days: about 100,000 last year; and about 140,000, we project,
this year. A new system called e-CAT improves the quality and
consistency of decisions. Every state in the nation will have
this upgrade before we move from 54 separate COBOL-based
systems to begin testing a common state-of-the-art web-based
system in April 2011.
Unfortunately for the DDSs, not all the news is good. Case
filings are rising faster than we can hire and train new
employees, and the number of pending cases is increasing. State
furloughs aggravate the problems created by the recession. As
nonsensical as it is for states to respond to fiscal crisis by
furloughing DDS employees, many of them have done so. I am
grateful to Vice President Biden and the many members of this
Subcommittee who have helped me persuade some governors not to
take this misguided action.
In short, we have made solid progress. We are applying the
same thoughtful planning and best practices from our hearing
plan to handle the additional initial disability claims. We are
expanding our capacity at the initial level. By the end of
fiscal year 2010 we expect to have nearly 2,800 more DDS
employees than we had at the end of fiscal year 2008, and we
are increasing the number of Federal workers who are reviewing
these cases. With your support, we hope to beat our target date
of 2013 for elimination of the disability backlog, despite all
the new cases from this recession.
We understand, too, that we have many other service
challenges--from the work CDR issues, to reduced waiting times,
clearer notices, better telephone services, and other areas. We
are going to do our best to live up to your expectations.
Thank you. I would be happy to answer any questions you may
have.
[The prepard statement of Mr. Astrue follows:]
Prepared Statement of The Honorable Michael J. Astrue, Commissioner,
Social Security Administration
Chairman Tanner, Ranking Member Johnson, and Members of the
Subcommittee:
Thank you for the opportunity to discuss our progress in driving
down the hearings backlog, our strategy to manage the surge of initial
disability applications, and our ongoing efforts to improve service
delivery and program integrity.
I am proud to report to you today that last year we improved
service across the agency, and we are currently maintaining that
momentum as we begin fiscal year (FY) 2010.
For nearly 75 years, our programs and responsibilities have
continued to change and expand. Our employees worked hard to keep up by
creating new systems and streamlining policies and processes that
helped us improve productivity by an average of 3 percent each year
over the last 5 years. Even though, until recently, we had not received
sufficient funding to keep pace with our increased workloads.
Your help in changing this pattern of chronic underfunding came at
a most critical time, just as the recession and the aging Baby Boomers
were exacerbating our already fragile situation. We greatly appreciate
the funding Congress provided in our FY 2009 appropriation and in the
American Recovery and Reinvestment Act of 2009 (Recovery Act). Our use
of these additional resources demonstrate--to you, to the President,
and most importantly, to the American public--that we are a sound
investment.
In FY 2009, we processed more retirement, initial disability, and
hearing applications than ever before. We increased our average agency-
wide productivity by 4.49 percent over FY 2008.
We made solid and sustained progress in eliminating our hearings
backlog by reducing both our pending hearings for the first time in a
decade and the time applicants waited for a hearing. These
accomplishments are all the more impressive considering that, at the
same time, we continued to focus on the oldest, most complex, and time-
consuming cases.
In FY 2009, we processed over 175,000 more initial disability
claims than we had expected to process in that year. We kept the
pending level below 800,000 even though we received nearly 400,000 more
applications than we had in FY 2008. We also reduced the initial
disability claims average processing time by 5 days. We decided the
cases of about 100,000 Americans with the most severe disabilities
through our Quick Disability Determination and Compassionate Allowance
initiatives in about ten days from the date of receipt in the State
Disability Determinations Services (DDS).
We launched our new online application, iClaim, in December 2008.
This quick, easy-to-use online service helped us deal with the increase
in benefit applications. We decreased waiting times in our field
offices and on our 800 Number.
During this difficult economic crisis, Americans are turning to us
for help more than ever before. In FY 2010, we expect to receive 1.2
million more claims than we received in FY 2008. I weighed the risks of
an uncertain budget against the need to sustain our progress and
decided to authorize our components to continue hiring and working
maximum overtime during the continuing resolution (CR). Therefore, we
are using the multi-year Recovery Act funding to help sustain our
momentum this fiscal year during the CR. We, nevertheless, are counting
on your support to pass the President's full FY 2010 budget. This
budget will help sustain the substantial progress made in the past
year.
Plan to Address Rising Workloads
We have detailed, achievable plans in place to address our soaring
workloads, and our employees are dedicated to eliminating the hearings
backlog by 2013. They are also poised to keep up with the recession-
driven increase in initial disability claims. We will not, however, be
able to achieve these goals without timely, adequate, and sustained
funding.
In FY 2009, Congress provided us with $126.5 million above the
President's budget request and authorized $500 million of the Recovery
Act funds to help us process our rapidly rising retirement and
disability workloads and to reduce the hearings backlog.
In FY 2009, we hired approximately 8,600 new employees, most of
them in less than six months, which was our largest hiring effort since
the creation of the Supplemental Security Income (SSI) program about
thirty-five years ago. Management at every level of the agency
responded to this hiring opportunity with the urgency that tough times
require. Given all of the conditions and hurdles involved with hiring
in the civil service and the obstacles created by some governors and
State legislatures in staffing the DDSs, this accomplishment is a great
testament to the skill and dedication of everyone involved. Along with
that hiring, we also maximized the use of overtime across the agency.
We recognize, though, that merely adding employees, while critical
to our success, will not solve all of our problems. Expanding our use
of technology is essential--we become more efficient as we automate
additional processes. We used Recovery Act funds to purchase additional
computers for our new employees, as well as video conferencing
equipment for hearings and increased bandwidth to improve the
availability of our systems. In January 2009, we took possession of our
second data support center, and by May, began moving some of our
workloads to the new center. These enhancements allowed us to reduce by
two-thirds the time our disability systems were down.
In August 2009, we released a request for proposals to expand our
use of health IT to gather electronic medical records. Obtaining
medical records is one of the most critical and time-consuming aspects
of making disability decisions. Health IT holds the promise to
drastically reduce our disability processing times. In January 2010, we
will use Recovery Act resources to issue $24 million in contracts with
additional medical providers and networks.
Early in my tenure, I recognized the need for a new, state-of-the-
art data center. It is vital that we have a stable, reliable data
center to protect the sensitive data we maintain and to achieve our
ongoing efforts to improve automation and increase the use of online
services. In the Recovery Act, Congress gave us $500 million to build
and partially equip a new, modern data center that will incorporate
green building technology. It is a complicated process to plan and
build a new data center, and it will not be completed until 2013. We
have been planning for the new facility for some time, and in August,
2009, the General Services Administration (GSA) issued a request for
expressions of interest for site selection. We anticipate awarding the
contract in early 2010.
In addition to handling our customary work, we played a critical
role in issuing $250 economic recovery payments, ahead of the statutory
deadline, to over 55 million beneficiaries who received Social Security
and Supplemental Security Income benefits. These payments injected more
than $13 billion into the struggling economy.
Maintaining Momentum to Eliminate the Hearings Backlog
As I have said many times, eliminating the hearings backlog is a
moral imperative. In FY 2009, we received over 30,000 more hearing
requests than in FY 2008. Despite this increase in the number of
requests, I am pleased to report the news is good. For my first 22
months, we steadily reduced the rate at which the number of pending
cases increased. We hit the turning point this past January, and in
every month since then, the number of pending cases dropped. The rate
of decline is accelerating--in the last three months, we reduced the
hearings backlog by a greater percentage than we did in the previous
seven months. By the end of FY 2009, we had reduced our pending
hearings by nearly 38,000 cases.
Morally and operationally, we should focus our attention on
applicants who have been waiting the longest for their hearings; no one
should have to wait years for a decision on their benefit claim. We
have steadily reduced the number of cases that have waited the longest.
In FY 2007, we started by resolving virtually all 65,000 cases pending
over 1,000 days. In FY 2008, we cleared nearly all 135,000 cases
pending over 900 days. In FY 2009, we resolved nearly all 166,000 cases
pending over 850 days. For FY 2010, we are ahead of schedule in
resolving the over 135,000 cases pending 825 days or longer.
Mathematically, our targeted effort with older cases meant that
average processing time remained artificially high for a while, but
that figure is also now starting to drop. We have kept it below 500
days since June 2009, and last month it was 446 days. Moreover, the
average processing time for our most backlogged offices is coming down
faster than for other offices. In February 2007, the average processing
time for Atlanta was 852 days, and we had six offices with processing
times between 650 and 852 days. Last month our most backlogged office
was Dayton, Ohio at 651 days.
While 651 days for a hearing is not acceptable, but shortly such
performance will be a disturbing piece of history. By the middle of
next year, seven new offices will open in Michigan, Ohio, Georgia,
North Carolina, and Indiana, our five most congested states. With plans
for 25 new hearing offices, 7 new satellite offices, and scores of
office modifications and expansions, we are adding the space we need to
address the cases that continue flooding in.
The expansion of our physical infrastructure will allow us to
accommodate additional ALJs and support staff. While we still have work
to do to reach our goal of an average processing time of 270 days, we
have made significant progress and have a clear plan in place to reach
that goal.
In FY 2009, we hired 147 ALJs and over 1,000 support staff in the
Office of Disability Adjudication and Review (ODAR), which is
responsible for our hearing offices. In FY 2010, we plan to hire
another 226 ALJs and maintain an average support staff ratio of at
least 4.5 support staff per judge. By the end of FY 2010, we should
have about 1,450 ALJs on board.
The Government Accountability Office recently agreed that under our
hearings backlog reduction plan, we should be able to reduce our
backlog, but noted that reaching our goal by 2013 is largely dependent
on our ability to improve ALJ hiring, availability, and productivity.
Sufficient resources and a strong pool of candidates from which to hire
additional ALJs are vital elements to our success. Office of Personnel
Management (OPM) Director John Berry has worked very closely with us to
address our need to maintain a qualified pool of candidates through the
ALJ examination process. I am extremely appreciative of John's decision
to open a new ALJ register because OPM's continued support is critical
for us to achieve our ALJ staffing needs.
ODAR should be proud of its three consecutive years of greatly
improved productivity. Without that achievement, we would not have
reduced the backlog last year.
We have a number of ways to track productivity, but an important
bottom-line measure is the percentage of ALJs who reach our minimum
annual disposition expectation of 500 cases. The number of ALJs, who
reach that level, is steadily increasing. In FY 2007, 46 percent of our
ALJs reached that level. In FY 2008, 56 percent reached that level, and
in FY 2009, 71 percent reached that level. In fact, last fiscal year 89
percent of the ALJs disposed of over 400 cases. That individual success
is a team success because the ALJs need sufficient support staff to
prepare the cases for a hearing and write up the decisions after the
hearing has been held. Last year, our ALJs received support from a
recent high average of 4.6 support staff per ALJ.
Success has come from hard work, better systems, better training,
and better business processes. We designed National Hearing Centers
(NHCs) to quickly help the most beleaguered offices. In 2009, we opened
three new NHCs, in addition to Falls Church, Virginia: Albuquerque, New
Mexico; Chicago, Illinois; and Baltimore, Maryland. In May 2010, we
plan to open our fifth NHC in St. Louis, Missouri.
The ALJs in the NHCs hold hearings remotely using video
conferencing equipment, providing us the flexibility to better balance
pending workloads across the country. We are seeing results in some of
the most-backlogged offices that transferred cases to our first NHC in
Falls Church, Virginia. Average processing times in Atlanta, Georgia;
Cleveland, Ohio; and Flint, Michigan have dramatically improved with
the assistance of the NHC. In FY 2009, the NHCs issued over 9,000
decisions.
We continue to expand our use of video technology. We are
furnishing more hearing offices with video equipment so offices with
available resources can assist offices with the greatest backlogs. More
and more claimants in remote locations are asking for video hearings,
which are not only more efficient, but also more professional and
appropriate for ALJs and claimants than holding hearings in motels or
other makeshift places. We are reducing the use of these temporary
hearing sites, replacing them with video hearing rooms in field offices
and other Social Security facilities. We implemented the Representative
Video Project to allow representatives of disability claimants to use
their personal equipment to participate in hearings from their own
offices.
In addition to processing the most aged cases, we are taking a
number of steps to expedite fully favorable decisions. We reinstituted
the Attorney Adjudicator program to allow our most experienced
attorneys in appropriate cases to make on-the-record, fully favorable
decisions without a hearing. In FY 2009, attorney adjudicators issued
over 36,000 favorable decisions. We have also instituted special
Federal Quality Reviewer screening units and a Medical Expert Screening
process to help identify cases that we can allow without the need for a
hearing.
We identified cases that were likely allowances and electronically
transferred them back to the DDSs for further review. As a result of
this initiative, the DDSs allowed nearly 15,000 claims in FY 2009, and
we were able to dismiss those requests for hearing.
The DDSs will not be able to provide the same level of assistance
this year--they will be handling a flood of new initial disability
applications. But our backlog reduction plan is not static. We continue
to look for new ways to achieve our goals. We are using predictive
modeling to help us decide which new techniques will most effectively
help eliminate our backlog and improve our business process.
We are testing a new, more sophisticated screening tool to identify
cases for senior attorneys to review. We used predictive modeling to
help us determine the proper balance between the number of attorneys
screening cases and the number who are writing decisions for ALJs.
Based on our analysis, we are identifying 100 senior attorneys to work
in a virtual screening cadre to review the disability hearing backlog
for potential allowances. We believe that this innovative solution
using our improved screening methodology and the electronic folder to
move work to the members of the virtual unit will identify about 14,600
on-the-record, fully favorable allowances this year. These cases will
not require a hearing before an ALJ. This new initiative will allow the
DDSs to focus on processing initial disability claims without
jeopardizing our progress in reducing the hearings backlog. In
addition, we are adding centralized, regional units to pull cases and
write decisions to more quickly address emerging issues.
We are working more efficiently in our hearing offices. In FY 2009,
we made significant progress to eliminate the remaining paper hearings
folders and to transition to an all-electronic environment. In this
electronic environment, we are establishing a standardized electronic
hearings business process. This process standardizes the day-to-day
operations and incorporates best practices for hearings offices
nationwide. We began rolling out this process to 30 hearing offices in
FY 2009. We will implement it in all hearing offices by the end of FY
2010.
As we increase our capacity to hear and decide cases, we must
consider the resulting workload for the Appeals Council (Council). The
Council's receipts are outpacing dispositions, with an almost 16
percent increase in receipts in FY 2009 over FY 2008. We expect that
receipts will continue to increase by another 12 percent in FY 2010.
Last fiscal year, we began preparing for the increase by hiring 16 new
administrative appeals judges, 45 new appeals officers, and almost 200
new paralegals and attorney advisers. We revamped the new analyst
training course with the goal of shortening the historic learning
curve. The new training curriculum has been a success, and productivity
has exceeded expectations for the class of analysts that graduated in
July 2009.
In FY 2009, the Council had many successes. It processed over
89,000 requests for review, 7 percent more than it processed in FY
2008. Despite increasing receipts, it exceeded its case processing goal
with an average processing time of 261 days, even while eliminating
cases over 750 days old.
Since I became Commissioner in 2007, I have repeatedly stated that
reducing the hearings backlog is our number one priority, and that is
still the case. We have implemented a solid plan and have demonstrated
that it is working. With your continued support, I am confident that we
will eliminate the hearings backlog by 2013.
Strategy for Unprecedented Increase in Disability Claims
However, we currently face another serious challenge--the flood of
initial disability claims resulting from the economic downturn. The
unemployment rate affects the number of disability claims we receive,
and with the recent unemployment numbers at over 10 percent, the number
of our disability applications will peak in 2010 at over 3.3 million.
We are using our experience and some of our strategies from the
hearings backlog reduction plan to implement a complementary plan to
process the additional initial disability claims resulting from the
recession.
We expect nearly 700,000 more initial disability claims in FY 2010
than we received in FY 2008. We simply do not have the capacity to
process all of the incoming applications with the same timeliness of
the past year.
Processing disability claims is our most labor-intensive workload.
We cannot address our current challenge without additional staff,
particularly disability examiners and medical consultants in the State
DDSs. We developed a strategy to increase our capacity and optimize our
productivity to return to the pre-recession initial claims pending
level by 2013.
The increase in our FY 2009 appropriation and Recovery Act funding
allowed us to begin implementing our strategy last fiscal year. We
hired 2,600 employees in the DDSs, ending FY 2009 with 1,400 more
employees than at the end of FY 2008. While these hires helped us
process over 200,000 more disability claims last year than we did in FY
2008, they spent a lot of their time in training and were not fully
productive. This year we expect that the additional fully-trained staff
will process substantially more cases.
Despite the nearly 17 percent increase in initial disability claims
in FY 2009, the DDSs increased productivity by 3 percent, and so far
their quality and average processing times are generally holding up
well. Average initial disability processing time decreased 5 days to
101 days, and nationally the DDSs achieved the highest level
performance accuracy in the past decade.
For the DDSs, not all the news is good. Disability applications are
rising faster than we can hire and train, and the number of pending
cases is increasing--escalating the pressure on the DDSs. Despite our
employees' heroic efforts to process initial disability claims timely
and accurately, our pending cases had grown to nearly 780,000 by the
end of FY 2009--over 200,000 more cases than at the end of FY 2008. Our
pending disability claims could reach as much as 1 million this year.
We know this pending level is unacceptable and are working diligently
to minimize the increase.
State furloughs aggravate the problems created by the recession. As
nonsensical as it is for States to respond to the fiscal crisis by
furloughing employees whose salaries and benefits we fully fund, many
of them have done so. I have spent a lot of time over the last year
trying to educate State officials on the unnecessary and harmful
effects of furloughing DDS employees. I have personally spoken to many
governors or State officials, and I wrote letters to every governor and
to the National Governor's Association. In addition, each of our ten
Regional Commissioners has been aggressively pursuing DDS furlough
exemptions at the local level.
We have received considerable support from you and the
Administration. I am grateful to Vice President Biden and the many
Members of this Committee who have helped me persuade some governors
not to take this misguided action.
We were successful in gaining exemptions or partial exemptions in
several States, like Michigan, Nevada, New York, and Colorado. Other
States, such as California, Wisconsin, Ohio, and Hawaii, have ignored
our clear logic and have imposed destructive furloughs on our DDS
employees. Currently twelve States have implemented furloughs that
affect our DDS employees. I know that, like me, you are frustrated by
these decisions.
While some States have argued that the furloughs are not affecting
their ability to make disability determinations, these assertions are
simply not true. For example, California is furloughing DDS employees
three days each month. In FY 2010 this decision will delay $11 million
in disability benefits to over 40,000 of California's most vulnerable
residents at a time when the State already has one of the highest
unemployment rates in the country. There are many clear signs of the
deterioration in service. In spite of the hard work of the dedicated
DDS employees, the number of initial claims currently pending in
California is 22 percent higher than in 2008. The percentage of
California cases pending over 90 days has grown. In the first calendar
quarter of 2009, California's Initial Claims Performance Accuracy was
below the Federal regulatory threshold.
The residents of California should not be penalized for the actions
of their officials. We are trying to mitigate the problems in
California by deferring 9,000 continuing disability reviews so that the
DDS can concentrate on initial applications, maximizing the use of
overtime, obtaining medical consultant assistance from another State,
and providing Federal assistance with State medical reviews.
As we began developing our strategy to process the additional
recession-driven disability claims, we knew that certain States and
regions had been harder hit by the recession than others. Since
unemployment rates correlate directly with the number of disability
claims we receive, we began to take a closer look at the unemployment
rates and forecasts of disability receipts at the State level. We are
using this information to decide how to allocate our resources--based
on not only the current situation, but also on future population and
unemployment trends.
In addition, we are analyzing a combination of DDS key indicators
to determine a State's ability to keep pace with its current and future
receipts. We focus on the indicators that most directly demonstrate the
State's ability to handle additional claims, such as how old the cases
are, how long they have been pending, the level of receipts, the
processing time, the rate at which we are losing our employees, and
whether the DDS is under a hiring freeze or furlough. By monitoring
these indicators, we can quickly provide assistance to the most
overwhelmed States.
This year we will continue to implement our strategy to process the
increased receipts. With the President's FY 2010 budget, we plan to add
1,400 new DDS employees. By the end of FY 2010, we expect to have 2,800
more DDS employees on board than we did at the end of FY 2008.
We are using our best practices from the hearings backlog reduction
plan to create centralized units--similar to the National Hearing
Centers--that will assist States across the Nation. These new units,
called Extended Service Teams, will be placed in States that have a
history of high quality and productivity and the capacity to hire and
train significant numbers of additional staff. In FY 2010, we plan to
place 280 new employees in four States (Virginia, Arkansas, Oklahoma,
and Mississippi) to help staff the teams that will be able to quickly
take cases from the hardest hit States.
We are also expanding our Federal capacity to process cases. We
currently have a Federal unit in each of our ten regions and two units
in Baltimore that assist the DDSs in processing cases. In FY 2010, we
plan to provide 237 additional hires in these units.
In addition to hiring more disability examiners to process the
claims, we also need to increase our medical consultant staff to
support the examiners. Traditionally, the medical consultants work
onsite in the DDSs to review the medical evidence, provide guidance to
the examiners on the severity of the applicants' conditions, and, in
many cases, sign off on disability determinations.
If we do not have sufficient evidence to make a disability
determination, we often send applicants for a consultative examination
with a medical professional. These exams can increase the cost and
waiting times for a disability decision. It is sometimes challenging to
find medical providers with the appropriate specialty necessary for the
exam. For example, psychiatry is a specialty that can often be
difficult to obtain. We plan to use our video conferencing technology
to conduct psychiatric consultative exams remotely. This technology
will help us save money and time by reducing the claimants' travel to
these exams.
We will continue to enhance our Quick Disability Determination
(QDD) and Compassionate Allowances (CAL) initiatives to fast-track
cases that are likely allowances. QDD uses a predictive model to
identify certain cases that are likely allowances, such as low birth-
weight babies, cancer, and end-stage renal disease. CAL allows us to
quickly identify applicants, who are clearly disabled based on the
nature of their disease or condition. The list of CAL conditions
currently contains 25 rare diseases and 25 cancers. We have held five
public hearings to obtain critical information to develop and enhance
this list of conditions. In July, we held a hearing on Early-Onset
Alzheimer's disease, and yesterday in San Francisco, I presided over
our latest hearing on schizophrenia. We plan to increase the number of
conditions on the CAL list in early calendar year 2010. In 2010, we
expect that our enhancements to QDD and CAL will allow us to fast-track
about 140,000 decisions for the most severely disabled Americans while
maintaining accuracy. These improvement at the DDSs also help reduce
the hearings backlog.
We are also exploring options for expansion of single decision
maker (SDM) authority to cases that are identified as QDD or CAL. SDM
allows a disability examiner to adjudicate a case without the approval
of a medical or psychological consultant.
Another automated tool, the Electronic Claims Analysis Tool (eCAT),
is proving to be extremely valuable to the disability decision process.
eCAT improves the quality and consistency of our decisions by aiding
examiners in documenting, analyzing, and processing the disability
claim in accordance with regulations. We expect that the use of eCAT
will produce well-reasoned determinations with easy-to-understand
explanations of how we reached our decision. This documentation is
particularly useful for future case review if an appeal is filed. We
are beginning to look at adapting eCAT for use at the hearing level.
In addition to enhancing the documentation, quality, and
consistency of our disability decisions, eCAT has been an extremely
useful training tool for the many new examiners we are hiring in the
DDSs. All states have the training version of eCAT. Training through
eCAT is helping new examiners more quickly gain proficiency in
processing complicated cases.
We are accelerating the expansion of eCAT since we have determined
that it is working well in the DDSs that have piloted it. We have
already started rolling it out in eight States, and we are currently
planning to roll it out to all DDSs by December 2010.
Every state in the Nation will have this upgrade before we
implement the common Disability Case Processing System (DCPS).
Currently each of the DDSs has its own unique case processing system,
many of them COBOL-based. In April 2011, we will begin beta testing a
common, state-of-the-art web-based system that will provide additional
functionality and the foundation for a seamless disability process. It
will make it easier to implement technology changes and will position
us to take advantage of health IT.
For more than a year, we have been piloting the use of health IT to
help speed decisions on disability claims. Applicants who have been
treated at Beth Israel Deaconess Medical Center in Boston,
Massachusetts or at MedVirginia facilities in Richmond, Virginia can
authorize their medical records to be transferred electronically to the
DDSs. Generally, we receive medical records from these facilities in
less than a minute.
In these two pilots, the receipt of electronic medical records has
reduced the average DDS processing time to about 48 days, a nearly 50
percent decrease. In fact, we are making medical decisions within 48
hours of taking the claim in 11 percent of the pilot cases.
Using Recovery Act funding, this fiscal year, we are expanding our
use of health IT to more health care providers and States. In January,
we will award competitive contracts to providers and networks that will
give us standard medical data needed to make disability decisions. A
key requirement of these contracts is that data must be delivered over
the Nationwide Health Information Network that ensures secure
transmission of personal health information. We are actively
participating in the Department of Health and Human Service efforts to
produce technical standards for widespread use, including in our health
IT systems.
Improving Service Delivery
We understand, too, that we have many other service challenges--
from the work CDR issue that Chairman and Mr. Johnson highlighted last
Thursday to prompt telephone service, reduced waiting times, clearer
notices, and many other services.
We knew the aging baby-boomers would put pressure on our 800 Number
and field offices. As this generation is becoming more comfortable
conducting business on the Internet, we must offer more online services
to meet their demands and relieve some of the strain on our field
offices. In addition, Americans of all ages began turning to us for
assistance during this economic crisis. Our online services, automated
telephone services, and additional agents answering the 800 Number are
providing the public with service options to conduct their business
from the comfort of their own homes.
The implementation of iClaim in December 2008, combined with our
effective marketing campaign starring Patty Duke, provided an instant
spike in both online retirement and disability applications. Online
retirement applications increased from 26 percent to 35 percent in less
than one month. Online disability applications also increased from 14
percent to 21 percent. We have maintained the increase in Internet
claims with online retirement applications currently at 34 percent and
disability applications at 22 percent. In FY 2009, over 400,000 more
applicants filed for benefits on the Internet, more than twice as many
as the year before.. This increase helped us deal with the additional
recession-driven claims and helped us reduce our waiting times in field
offices.
Our online applications took the top three rankings in the most
recent American Customer Satisfaction Index (ACSI). The ACSI tracks
trends in customer satisfaction and provides valuable benchmarking
insights of the consumer economy for companies, industry trade
associations, and government agencies. Our Retirement Estimator led all
scores, iClaim followed closely, and our Medicare Subsidy application
came in third place.
This year we are implementing several new projects to improve our
current online services and to provide additional online options to the
public. In February 2010, we plan to expand the capability of iClaim to
allow persons to file for Medicare-only benefits at age 65 if they
choose to delay retirement benefits while they continue to work. We
plan to increase the number of our online services in Spanish. We will
start by creating a Spanish version of our retirement estimator. With
enhancements to iClaim and new marketing strategies, we expect to
increase the percentage of online retirement applications to 38 percent
this year.
Even though we did not market our online disability application
when we launched iClaim, online applications for disability have also
increased. We expect this positive trend to continue when we release a
simplified electronic version of the Adult Disability Report in January
2010. We use this form to obtain basic information on the applicant's
medical condition and treating sources. This improvement will reduce
the time needed to complete the disability application and improve the
quality of the information we receive. We expect to increase the
percentage of online disability applications to 25 percent this year.
In October, we began rolling out the first phase of the Appointed
Representative Suite of Services. This process allows appointed
representatives of disability applicants to view their clients'
electronic folders through secure online access. Additional phases of
this initiative will provide folder access to more representatives,
simplify the process for submitting appeals, and document a
representative's appointment. This online service will alleviate
workloads in our field offices.
This year we will also pilot a Claims Data Web Service. Each year
we receive over 100,000 paper applications and appeals filed by third
party organizations, such as representatives, hospitals, and social
workers. Our field office employees must manually enter all of this
information into our systems. This pilot will allow selected third
parties to submit application information electronically to field
offices, eliminating the time our employees spend manually keying this
data.
Our 800 Number is often the first point of contact the public makes
with us. If they are greeted with a busy signal or placed on hold for
an extended period of time, they may become frustrated and come into
our field offices instead. Last year, we significantly reduced waiting
times and busy signals on the 800 Number.
Our 800 Number call volume has been increasing each year, exceeding
82 million calls in FY 2009. To handle the increasing number of calls,
we hired about 260 additional telephone agents last year, and we used
technology to effectively forecast call volumes, anticipate staffing
needs, and better distribute calls across the network. As a result, we
improved our speed of answering calls by 25 percent. We answered calls
within an average of 245 seconds, the lowest average wait time in 6
years. We also reduced our average busy rate from 10 percent in FY 2008
to 8 percent last year.
As we expect call volumes to increase this year, we plan to hire
additional telephone agents to maintain our 800 Number services. To
position ourselves for the future, we started exploring click-to-
communicate technologies to allow telephone agents to assist users as
they use our online services. We started the process to replace our 800
Number system with more-modern technology and began working with GSA to
build a new teleservice center in Jackson, Tennessee. The new
teleservice center, the first to be opened in more than a decade, will
open in 2011.
Even with our efforts to improve our online and telephone service,
we have experienced a steady increase in the number of field office
visitors. Field offices averaged 806,000 visitors per week in FY 2006,
825,000 in FY 2007, and 854,000 in FY 2008. In FY 2009, we averaged
over 866,000 visitors each week.
With the additional funding we received from Congress last year, we
were able to add about 1,400 more employees in our front-line
operational components and made maximum use of overtime to take claims
and answer our 800 Number calls. In addition to processing more claims
than ever before, we reduced office wait times despite increasing field
office traffic. With the President's FY 2010 budget, we plan to
maintain our staffing level and work maximum overtime to minimize wait
times and provide the best possible service to the unprecedented number
of Americans, who continue to turn to us for assistance in this
difficult economic environment.
In addition to using video technology to reduce our hearings
backlog, we are exploring ways that it can help us process our initial
disability claims, and we are using it in our field offices to connect
to persons who live in remote areas or find it difficult to visit a
field office. We are piloting video service delivery by using available
staff in a less-busy office help other offices that may be overwhelmed
with visitors waiting for service. In addition, we are placing video
equipment at third-party sites, such as hospitals, community centers,
libraries, and Indian reservations to provide field office service.
We continue to pilot self-help computers in our waiting rooms.
These computers offer access to our online services. Currently, about
60 offices are testing this service. In addition, we are piloting
Social Security TV in some of our field office reception areas. The
televisions broadcast information about our programs and services, such
as explaining what documents are needed when applying for benefits or a
Social Security number. We can tailor the broadcasts to the local
demographics, providing information in multiple languages. We currently
offer this service in 18 field offices, but we are expanding its use to
150 more offices this year.
Increasing Our Program Integrity Efforts
One of our ongoing challenges is how to effectively balance our
important program integrity work with the growing need to serve the
public. Both efforts profoundly affect peoples' lives as well as the
economic health of the Nation. Sustained, adequate, and timely funding
is vital to helping us achieve this balance.
The primary tools we use for ensuring proper payments are
continuing disability reviews (CDR), which are work or medical reviews
to determine if disability beneficiaries are still disabled, and
Supplemental Security Income (SSI) redeterminations, which are
reevaluations of the non-medical factors of SSI eligibility.
Recently, however, we have paid the price for the growth in
workloads and tight budgets. Resource limitations have reduced the
number of CDRs and SSI redeterminations we can handle. We do not want
to defer this important work because these reviews help ensure that we
pay the right beneficiary the right amount at the right time.
In addition to increasing our capacity to serve the public, the
President's FY 2010 budget makes a renewed funding commitment to our
program integrity efforts as part of a government-wide initiative to
make government more effective and efficient. Specifically, the FY 2010
budget provides $758 million for our program integrity efforts, an
increase of $254 million from FY 2009. If enacted, this additional
funding will assist us in protecting the public's tax dollars.
With the funding proposed in the FY 2010 budget, we can complete a
total of 794,000 CDRs, of which 329,000 will be full medical CDRs, and
2,422,000 SSI redeterminations. We estimate that every dollar spent on
medical CDRs yields at least $10 in lifetime program savings.
In FY 2008, our payment accuracy for OASDI was 99.7 percent with
respect to overpayments and 99.9 percent with respect to underpayments.
For SSI, the rate was 89.7 percent with respect to overpayments and
98.2 percent with respect to underpayments. Clearly, payment accuracy
is very high in the OASDI program and with respect to SSI
underpayments; nonetheless, we believe we can do better. SSI
overpayments accuracy is another story. This is the lowest accuracy
rate in the program since its early days. We are committed to improving
our payment accuracy and reducing the volume and magnitude of improper
payments we make in both programs. I recently appointed an agency
executive to enhance our efforts.
CDRs
We initiate work CDRs based on work activity when a beneficiary
voluntarily reports that he or she is working, when wages are posted to
a beneficiary's earnings record, or when a beneficiary has completed a
trial work period. Last year, we completed more than 165,000 work CDRs
in our field offices.
Generally, the Social Security Act requires us to conduct medical
CDRs on a periodic basis to ensure that only beneficiaries who continue
to be disabled receive benefits. In conducting these CDRs, we use one
of two methods. We send some cases to the DDSs for a full medical
review; others may be completed using the mailer process.
We have seen a rise in our full medical CDRs pending since FY 2002.
I must caution that, even with the proposed increase in dedicated
funding this year, we project the number of pending full medical CDRs
will increase by over 100,000 cases to roughly 1.5 million. We know we
need to do better.
We must also ensure that we pay SSI in the correct amounts. One of
the ways we ensure accurate payments is by periodically completing
redeterminations to review all the non-medical factors of SSI
eligibility, such as resource and income levels and living
arrangements.
There are two types of SSI redeterminations: scheduled and
unscheduled.
Generally we periodically schedule all recipients for a
redetermination at least once every six years. Moreover, we target the
most error-prone cases each year using a statistical model. We conduct
unscheduled redeterminations when recipients report, or we discover,
certain changes in circumstances that may affect the SSI payment
amount.
In FY 2009, we completed over 1,730,000 SSI redeterminations. This
fiscal year, we plan to process nearly 700,000 more redeterminations
than last fiscal year.
In addition to CDRs and SSI redeterminations, we have developed
other program integrity initiatives that use cost-effective means to
help us further manage and protect the programs we administer.
Electronic data matching provides a foundation for our ongoing program
integrity work. To identify both OASDI and SSI beneficiaries who are no
longer eligible for benefits, we match data in our records with over
400 State and local government organizations and 65 Federal agencies.
We are using modern technology in innovative ways to help us detect
and prevent payment errors. To maximize our return on investment, we
focus on addressing the leading causes of error. For SSI beneficiaries,
unreported resources and changes in earnings from work are two
significant factors that contribute to payment errors. We have recently
expanded two projects targeted to improve our ability to identify bank
accounts for SSI applicants and to make it easier and more convenient
for beneficiaries to report their wages each month.
The Access to Financial Information project automates our access to
financial data. This process allows us to identify and verify bank
accounts held by SSI applicants and recipients. We have tested the
process in New York, New Jersey, and California.
The President's FY 2010 budget includes up to $34 million for us to
expand this project. We are encouraged by these early results, but
there is a lot of work ahead as we expand and continue to develop plans
for implementing this project in additional States and accessing data
from more financial institutions.
Receipt of wages is another leading cause of SSI overpayments. To
make it more convenient and easier for beneficiaries to report wages,
we have recently implemented nationally an automated monthly telephone
wage reporting process. The process uses both touch-tone and voice
recognition telephone technology to collect the wage report. Our
software automatically enters the wage data into the SSI system, which
is much more efficient than if the beneficiary visited a field office,
and we manually enter the report into our system. We are encouraging
beneficiaries to use the telephone reporting system.
At the same time, we continue working with the law enforcement
community to pursue cases of fraud and abuse in our programs. Through
our Cooperative Disability Investigations (CDI) program, a joint
venture with the Office of the Inspector General (OIG), DDSs, and State
and local law enforcement personnel, we work collaboratively to
investigate allegations of fraud and abuse related to initial
disability claims. We currently have 20 units in 18 States. We plan to
open two new CDI units this year in South Carolina and Missouri. Last
year, we estimate that the program yielded an additional $240 million
in program savings. Our Inspector General estimates the CDI program
returns $14 in program savings for every $1 invested.
Sustaining Momentum Under the President's FY 2010 Budget
Prior to FY 2008, we had been under-funded for 14 straight years by
a total of over $2 billion, and the recession continues to increase our
workloads beyond what we projected. We now expect about 100,000 more
retirement and 350,000 more disability claims this year than we
projected in the FY 2010 President's budget.
Since I became Commissioner, even before the recession hit, I have
been informing you that we were facing an avalanche of retirement and
disability claims at the same time we were addressing a large hearings
backlog. In the past two years, you have heard our pleas and provided
additional funding. I greatly appreciate your support.
Recent appropriations have allowed us to hire thousands of new
employees and provide the space and equipment they need to serve the
public. These new employees are helping us improve our services, but
they require extensive training to handle our complex work. This
training time delays the positive effect that they will have on our
workloads. Thus, our greatest opportunity for success is directly tied
to timely, adequate, and sustained funding.
We are acutely aware of the Nation's difficult economic situation,
and we take our responsibility very seriously. We have prudently used
the additional resources you have provided to make comprehensive
improvements to our services to the American public at a time when they
need us most. We have demonstrated sound, yet flexible, planning that
we can adapt to the changing economic situation.
Even though we are currently operating under a CR, our Recovery Act
funding is allowing us to maintain the momentum we gained in the last
year.
For FY 2010, the President proposed a significant investment in
us--$11.6 billion, a 10 percent increase over FY 2009. This increase is
essential to maintain our progress. Without it, the hearings backlog
will worsen, and we will drown in the flood of additional disability
claims.
With the President's FY 2010 budget, we plan to hire a total of
about 7,500 employees, which will allow us to maintain our staffing
levels in our front-line operational components and add 1,400 employees
in the DDSs and 1,300 employees in our hearing offices. We will process
nearly 270,000 more initial disability claims than we did in FY 2009.
We will minimize the increase in pending initial disability claims, and
maintain our course to return the pre-recession pending level by 2013.
We will process nearly 65,000 additional hearing requests and
ensure that the hard-earned progress we have made to reduce the backlog
is not lost because of the economic downturn. We will remain on track
to eliminate the backlog by 2013.
We will make progress on the program integrity workloads that we
have deferred processing. Finally, we will continue to modernize our
information technology, which will enable us to pursue 21st-century
modes of service delivery. All of these investments are critical to
ensuring that we can overcome the dual challenges of accurately and
efficiently processing our ever-increasing workloads and meeting the
public's demand for our services into the future.
In short, we have made solid progress, and hope to beat our target
date of 2013 for the elimination of the hearings backlogs despite all
of the new cases stemming from the recession. We are committed to
working with Congress and the American people to achieve our goals and
improve service in the years ahead. With your support, we will
successfully overcome our challenges, but it will take a few years, and
we will continue to need timely, adequate, and sustained funding.
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Chairman TANNER. Thank you, Commissioner. You mentioned the
DDS backlog in 2013. The DDS backlog really is a rather recent
phenomenon, isn't it?
Mr. ASTRUE. Yes.
Chairman TANNER. Why would it take to 2013?
Mr. ASTRUE. It's a product of the recession, Mr. Tanner. We
were hit last year with, I believe about 400,000 more cases
than the actuaries originally projected. We will probably take
in about 700,000 more cases this fiscal year than were
projected. We were just not set up to handle an extra million
cases, because we were struggling a bit with staffing. It also
takes time to hire and train new employees.
So, we have moved as aggressively as we can. We have beefed
up the DDSs as much as we can. We are moving some Federal
workers to the processing of cases. There are some states that
have looked at other states that are furloughing and understand
that there is an issue. They have volunteered to set up special
units to handle work from other states.
We have special units called Extended Service Teams in four
states that are going to help us pick up from some of the
states that are going to be lagging with the furlough issue and
the impact of the recession.
Chairman TANNER. Do you have any comment about what Mr.
Filner said about the situation in California?
Mr. ASTRUE. The situation in California is a source of
great concern. Right now, the number of pending cases is
building up, and that's usually what happens right before our
average processing times start to deteriorate. The average
processing times have not significantly deteriorated yet, but
that's likely to happen in the next few months.
California is a state that has had issues in quality.
They're right near the bottom of the States in quality, even
before what's been going on lately. We have been having trouble
getting clear information about some of the things happening in
California. I believe both the director of the DDS and the
number two retired recently. It's a little confusing in
California. We do have concerns.
We don't have recent, as I understand it, quality review
information that would verify some of the complaints that Mr.
Filner is making, but we are monitoring it as closely as
possible. We certainly share the concern that California may be
heading toward a very inappropriate situation.
Chairman TANNER. Well, if the situation is as concerning as
Mr. Filner testified, California may deserve some special sort
of attention from you. If a judge is instructed to close cases
for the wrong reasons, that is very concerning. We are really
interested, and would appreciate you letting us know what you
find out.
Mr. ASTRUE. We are on this. We are trying to----
Chairman TANNER. It is sort of unusual for a Member to come
here with those sorts of statements, so we are concerned.
Mr. ASTRUE. Yes.
Chairman TANNER. It is not something we take lightly.
Mr. ASTRUE. We will report regularly to the Committee on
the California situation.
Chairman TANNER. Good.
Mr. Johnson.
Mr. JOHNSON. Thank you, Mr. Chairman. Mr. Astrue, we have
talked before about the Agency's outdated technology that
includes computer programs that are still COBOL-based.
Mr. ASTRUE. Yes.
Mr. JOHNSON. That's 1950s technology.
Mr. ASTRUE. Yes, sir.
Mr. JOHNSON. Today we have got a lot better stuff.
Mr. ASTRUE. We do.
Mr. JOHNSON. Can you tell me what you're doing to modernize
your system?
I am told that it could take as long as seven years for you
guys to get it updated. Can you talk about that to us?
Mr. ASTRUE. Yes. We are trying to do as much as we can as
fast as we can, in terms of systems modernization. It is a
daunting task, because, first of all, we have got 38 million
lines of COBOL code.
We have to be very careful as we replace code, that we
don't disrupt service. A lot of the programs are tied in with
each other in intricate ways, and sometimes it's very
difficult. When you pull out a piece of it, you have to be very
careful that you're not having unintended consequences. We are
moving to do that as aggressively as we can.
The first big step is, when we went electronic with the
DDSs, we kept the COBOL. That will be replaced. We should have
the----
Mr. JOHNSON. When?
Mr. ASTRUE. April 2011 is the target date for when the beta
will be ready on that, and then it will probably be a roll-out
over another 18 months.
Mr. JOHNSON. Why is that taking so long? Goodness gracious,
we've got technology out there. I mean, everybody in this
audience can go out there and get a new computer and be
upgraded today. Why can't you guys do that?
Mr. ASTRUE. Well, it's not just a question of the hardware.
The hardware is fairly simple to do. It's the software that
takes a long time to rewrite and to tie in with all of the
other software.
To give you some sense, the effort to come up with a much
better online retirement form, if I remember correctly took
some time. The online retirement form had to cut across 39
separate COBOL-based programs that then had to be retied
together. It is a long and difficult task. My sense is we may,
over the next three years, be able to replace half of it.
However, I don't think it's realistic, particularly in the
core of the program, the data on everybody. That's a big task,
and it's going to take us a while to get to that. If we had
more resources we could do it faster, but there are trade-offs.
There is a lot of pressure to supply----
Mr. JOHNSON. So you're telling me it's true, it might take
you seven years to get the program fixed?
Mr. ASTRUE. Yes, sir.
Mr. JOHNSON. That's gross. I think you ought to get into
that and figure out how to do it a little better.
You know, you said by early calendar year 2010 you would
have enough hardware and software in Durham to build up all the
Agency claims and data processing center systems, should there
be a catastrophic event at your center in Baltimore. Is that
still true? And what does ``early calendar year 2010'' mean?
Mr. ASTRUE. The situation for the back-up center now is
that the building is completed and the equipment is in there.
They are moving a little bit faster than, I think, originally
planned on getting some of the equipment in.
We are now--let me just double-check. We will be able to
fully back up and recover in just a few months, Mr. Johnson. So
we are ahead of the old schedule.
Mr. JOHNSON. That's new technology down there?
Mr. ASTRUE. Yes, that is substantially new technology. We
try to stay away from----
Mr. JOHNSON. That's a back-up?
Mr. ASTRUE. It's a back-up.
Mr. JOHNSON. Why can't you use it as primary, then?
Mr. ASTRUE. We are going to start using it as partial
primary, probably increasingly over the next two years, because
we run out of capacity at the National Computer Center in 2012.
We won't have the replacement for the National Computer Center
completed until then, so we are gradually shifting some
functions over to the back-up center, and will be tying
together the old National Computer Center and the new back-up
center until we have the new National Support Center up and
running. That should start coming on probably mid-2013.
Mr. JOHNSON. Mr. Chairman, I think we ought to be getting a
report about every six months on the progress of that thing,
because I think it's gross to have systems that old that don't
work right. My opinion. Thank you, sir. Thank you for your
testimony.
Chairman TANNER. We might do it a little more often than
six months, if that would be all right.
Mr. JOHNSON. Every month would be fine.
[Laughter.]
Chairman TANNER. That's what I was thinking, too.
Mr. Pomeroy.
Mr. POMEROY. Thank you, Mr. Chairman. Mr. Astrue, it's nice
to see you again. I like the straightforward tone of your
testimony. I mean, I don't think you make any bones about it.
The backlogs that we have are not acceptable. The Agency
performance, certainly with plenty of congressional culpability
because of funding, allowed a situation to grow to absolutely
unacceptable levels of backlog. I appreciate the headway that
you're making.
A couple of interesting items in your testimony. You
indicated that in 2009 you hired 8,600 new employees, the
largest hiring effort since the creation of the Social Security
program.
Mr. ASTRUE. Yes.
Mr. POMEROY. Would you care to elaborate on that?
Mr. ASTRUE. In fact, I think what is more remarkable, and a
great tribute to the people in the Agency, is we hired about
8,300 of those in 5\1/2\ months. We were on a hiring freeze
because of the continuing resolution until early March of this
year, and I believe we hired something like 325, 350 employees
for the whole agency, from October 1 until mid-March.
With the combination of the funding in the Appropriations
bill and the funding in the American Recovery and Reinvestment
Act, we went pedal to the metal, and we hired over 10 percent
of the agency in 5\1/2\ months.
Mr. POMEROY. Are you on track with the resources now given
to staff up to where you need to get?
Mr. ASTRUE. We are for now. I don't know yet what the
situation is going to be for 2011. There is sort of the good
news/bad news with the Recovery Act. Technically that's not
part of the baseline budget for the Agency. Therefore, I think,
whether you view my request for this year as overly aggressive
or fair depends a little bit on how you look at the Recovery
Act.
Certainly the Recovery Act money for the new National
Support Center, I think, should be conceptualized as a one-off.
It would not be fair to view that as part of the baseline.
However, I do think that the backlog money, in my view, really
is a recognition that that should have been in the baseline all
along, and ought to be viewed----
Mr. POMEROY. How is OMB viewing it?
Mr. ASTRUE [continuing]. In context of this----
Mr. POMEROY. Is it being added to baseline?
Mr. ASTRUE. I don't know. We don't have the pass-back yet,
so I don't know how they're going to view it.
Mr. POMEROY. That might be something we might want to
inquire--I am sure staff is noting this. The staffing component
of the stimulus money needs to be continued. No one viewed that
that staffing up was required for the duration of the stimulus
bill only, or 2009. It is part of getting the Agency back to
where it needed to be.
Mr. ASTRUE. Without talking out of school, I think it's
fair to say that that's one of the premises of my budget
request.
Mr. POMEROY. I would hope, Mr. Chairman, that the
Subcommittee might write a letter of inquiry to OMB, exploring
this topic, or I will personally, if the Subcommittee doesn't
care to.
Chairman TANNER. We already have.
Mr. POMEROY. We have already? Ah, that's cracker jack
staff.
[Laughter.]
Mr. POMEROY. Now, speaking of cracker jack staff, let's
move to ALJs. As my cracker jack staff was saying, ``Ask him
how they're doing, relative to when you threw a fit,'' and so,
I will try and----
[Laughter.]
Mr. POMEROY. I will try and rephrase that. I believe it was
your second day in office, but I was absolutely appalled that
the litigation at the early part of the decade, then resolved,
didn't break loose hiring because hiring had been frozen for
some time. Indeed, three or four more years went on with OPM
absolutely screwing this thing up, and the Agency not
unscrewing it up.
Actually, as a member of the Committee of oversight, I felt
like we were led down a primrose path with representations by
everybody that were completely inaccurate, relative to the
staffing up of ALJs. How are we doing, relative to where we
need to be?
In the end, I absolutely believe this is a critical
component of the backlog question.
Mr. ASTRUE. Right. I certainly share your sense it was a
rocky start, Mr. Pomeroy, and you had a lot of company in that
regard. I do want to thank the Subcommittee as a whole, and
you, in particular, as the primary point person for influencing
OPM, because certainly it wasn't going very well, just us
trying to do it directly. Without your help, I don't think it
would have happened.
We had a little bit of a replay of some of those issues
recently, but we have an ally in John Berry, the new head of
OPM, who is very attuned to these issues. I think he is in
sympathy with where the Subcommittee and I are on this. It's a
shame that we have had to take some of these issues up to Mr.
Berry to get them resolved, but we have had some great
progress. They have opened up the register again. They won't
tell us how many people were on the register, though we have
heard that there were 900 people as of eight o'clock the night
they cut it off, and that there are probably 1,200 to 1,400,
we're guessing, that are on the register. We don't know, but
that should be more than ample for our needs.
We have hired already--well, actually, no, not yet.
Tomorrow you will help us swear in 43 more Administrative Law
Judges. We are scheduled to hire 226 for the year.
Mr. POMEROY. Where will that bring the number?
Mr. ASTRUE. That will bring the number up to about 1,450. I
believe, that is what we're aiming at.
Mr. POMEROY. About 1,450?
Mr. ASTRUE. Let me just make sure I'm getting my years
right. Yes. We will be aiming for about 1,450, and the Fiscal
Year 2011 budget shoots for a slightly higher number than that.
Right now, as long as OPM does what it needs to do between
now and roughly the end of February, it's on the critical path,
because the truth is, right now we don't have space to put
them. With this class that we're swearing in tomorrow, we're
putting judges into pretty much every office that we have
available for Administrative Law Judges.
So, the hiring for the summer is predicated on an awful lot
of office space being open. It looks like GSA is going to hit
the mark on that. Most of it is coming----
Mr. POMEROY. Does this Committee--I know my time is up. Do
we need to be corresponding with GSA, as well as OPM on making
certain that we don't have an office backlog?
Mr. ASTRUE. I think you can send them a general letter
congratulating them on good progress and sharing your concern.
We have had a couple of isolated incidents a few places around
the country, but generally, the GSA work has really been
outstanding on this. I want to give them credit, because when
we first started opening up offices, we were about the only
game in town. But with the Recovery Act, they have been very
busy.
So, we actually have a list of the offices that are
supposed to be open. I can append to my testimony. But we have
one that----
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Mr. POMEROY. You know, my time is so far over. Mr.
Chairman, we might want to consider Subcommittee letters to OPM
and GSA both, asking that they do everything possible to
facilitate the work of the Agency in getting the ALJ number to
where it needs to be.
I thank you, and yield back.
Mr. ASTRUE. Okay.
Chairman TANNER. Thank you, Earl. I agree, and maybe we
will have a hearing sooner than later to follow up on some of
these questions that are coming out. They are very good.
Ms. Schwartz, please?
Ms. SCHWARTZ. Thank you, Mr. Chairman. Thank you for this
hearing. I do want to follow up on what both looks like good
work and good progress. Still, the numbers seem really shocking
to us. We get calls all the time, of course, in our offices,
and I noticed in Pennsylvania, it's still a year wait,
basically, you know.
So, it's hard to tell people ``If you're lucky, it will be
a year,'' you know?
Mr. ASTRUE. Yes.
Ms. SCHWARTZ. That's kind of where we are. I both want to
compliment you on all the progress you're making, and also say
it's just not quite enough; we want more. We want it to be
better, we want it to be faster.
Mr. ASTRUE. If there were a magic bullet and I could do it
faster, I would. I think the problem has been that the system
hasn't really been managed carefully. A lot of this is just
good management but it takes time.
Then part of it is capacity. It's a combination of the
systems in operation not being good enough and not having
enough capacity in the right places, which we're also working
very hard to try to equalize around the country.
When this large group of new offices start coming on stream
this summer, by the end of the year, calendar year, you should
see huge differences in certain parts of the country.
Ms. SCHWARTZ. I wanted to follow up on some questions I had
at the last hearing on this subject, I guess, in April.
Mr. ASTRUE. Yes.
Ms. SCHWARTZ. It was particularly about the use of the
medical exchange of information system.
Mr. ASTRUE. Yes.
Ms. SCHWARTZ. I want to follow up on the exchange of the
information through technology, and understanding that you,
through the Recovery Act, had additional dollars for the
exchange of what is very complicated and sometimes very time
consuming information to get, and that is the actual
information on the medical condition.
Could you update us on how much of that is information is
now being transferred or transmitted electronically?
Mr. ASTRUE. Sure.
Ms. SCHWARTZ. Has that, in fact, helped to speed things up?
Mr. ASTRUE. Sure.
Ms. SCHWARTZ. Also, how do you see this process moving
forward? To what degree is that sort of universally being
applied across the board, and helping in reducing the number of
days?
Mr. ASTRUE. I think I and most of the senior people in the
Agency are really excited about this development, because this
is the one big paradigm changer in disability processing that
we see coming forward in the next couple of years.
We spend an enormous amount of our administrative time,
money, and effort chasing down medical records, and if that can
be more efficient and complete it will help tremendously. Even
without trying very hard in the couple of pilots we have been
able to actually see what would work, we have been able to cut
our processing times roughly in half.
It also is going to improve quality, because a major source
of error is we often don't realize that the medical record is
incomplete. The claimant's attorneys often don't recognize that
it's incomplete; particularly for certain psychiatric and
sexually transmitted diseases, claimants are often very
reluctant to volunteer that that's really a major issue for
them. So, it's huge, in terms of timeliness, it's huge in terms
of quality.
What's frustrating is that we're not there yet. It would
make my life so much easier, and life for the people we serve
so much easier, if they were ready. So what we're trying to do
is make sure, with the money, that the systems that are being
built by others are going to be compatible with ours.
Ms. SCHWARTZ. Interoperability, yes.
Mr. ASTRUE. Jim Borland has had the lead for SSA over at
HHS, as they helped design the standard. We are spending a lot
of time with VA and DoD, as they design their standards to try
to make sure that it's as seamless as possible.
I am hoping that, at the back end of this recession, there
are at least a few early adopters in the private sector that
would make our life a lot easier. For instance, Kaiser
Permanente seems to be further ahead than a number of others.
If they were to have even a third of their members in
California on this, it could make a huge difference in fixing
the mess in California.
Ms. SCHWARTZ. Well, they are moving ahead, and as you know,
the Recovery Act also provided an additional $19 billion for
the private sector doctors and hospitals to implement
electronic medical records. Those standards for
interoperability and those Federal standards, HHS is moving
ahead on that, and should help. Although it's clearly not
universal yet.
Could you give us some idea, though, about what percentage
or number of records you are now actually being able to obtain
electronically?
Mr. ASTRUE. It's time. I am with you on that. I would like
to see this today.
Ms. SCHWARTZ. Yes.
Mr. ASTRUE. I am impatient. So we're piloting in
Massachusetts with Beth Israel Deaconess, and with Med
Virginia, which has been active in building the system that I
think everyone is going to be using for the transfer of this
kind of health care information.
We have additional pilots that we're using. With the 24
million dollars under the Recovery Act, they're allowed to
expand this and accelerate it as quickly as possible, but it's
a little premature for actual results yet.
Ms. SCHWARTZ. Because I would certainly like to see SSA,
and I mentioned this before, use electronic records similarly
to the Veteran's Administration, which does have electronic
medical records, and it is interoperable.
Mr. ASTRUE. Yes.
Ms. SCHWARTZ. Any veteran anywhere in the country can
access their records, or at least their providers can, so that
should help reduce some of the wait. In many cases, we're
obviously trying to push states and networks and regional
networks.
But again, maybe not for right now, but I would be
interested, as you are monitoring this, to see both how fast
it's going--I mean, you can't do this all yourself, you have to
have them electronic on the other end, you're absolutely right.
Mr. ASTRUE. Right.
Ms. SCHWARTZ. But to the degree of how much it's helping
the Agency, how many days it's saving, it's pretty impressive
to think it could cut time in half. That's pretty good.
Mr. ASTRUE. We haven't built changes from this into any of
our assumptions yet. I think our actuaries need to see
something a little bit more concrete before they're going to do
it.
But I think when that curve starts to accelerate, it's
going to move a lot of our numbers in a positive direction.
It's a very exciting prospect, and that's why we're spending
time and money on it now. Because the sooner it gets here, the
better it's going to be for everybody.
Ms. SCHWARTZ. I appreciate your efforts on this, and I know
that so do so many of our constituents who rely on this
information. I thank you, and we will continue to talk about
it.
Mr. ASTRUE. Thank you.
Chairman TANNER. Thank you, Ms. Schwartz. Mr. Becerra.
Mr. BECERRA. Thank you, Mr. Chairman. Mr. Commissioner,
good to see you again.
Mr. ASTRUE. Thank you.
Mr. BECERRA. Thank you for the work that you have done. I
appreciate that you were able to come back to us and tell us
that you have made some progress in reducing the backlogs. We
should heed your warnings about what could happen in the future
if we don't provide you with the resources that you need.
I want to focus on California. I know you have tried to get
the governor in our state of California to exclude the DDS
workers from the furloughs that he has instituted for state
employees. I know that we all know that he has not done that.
Now, the impact of those three-day furloughs per month is
that, essentially, 15 percent of the work is not being done on
any given month. If you take into account the size of the
backlogs that already exist throughout the country, but
certainly in California as well, and you reduce the
availability of services by 15 percent, just across the board,
not taking into account anything else, along with the fact that
you and others have testified and provided information about
the increasing caseload that's coming in, the claims that are
coming in, an increase of about 15 percent in the last fiscal
year from 2008 to 2009, and expecting another 10 to 15 percent
over 2009 to 2010. Through probably 2013, I'm told, the
estimate is that we will continue to see an increase in case
claims coming in for disabilities.
To lose 15 percent for no reason whatsoever--because we're
willing to pay the money, the Federal taxpayers are willing to
pay each state the money to provide the services; the state of
California, the governor is not spending one red cent to
provide a salary to the people who would do these
determinations--15 percent, more or less, cut right off the
top, on top of the fact that you see an avalanche of another 15
percent of claims coming, does that, to you, lead you to
conclude that the governor and the State of California are
making a good faith effort to provide effective services to
California's disability applicants?
Mr. ASTRUE. Well, I think that you can't take an action
like this without, at a minimum, harming timeliness, and
potentially hurting quality, as well.
A number of states are furloughing managers, but not staff.
I do not know what they think that does, but that is surely
going to create quality issues, too.
Mr. BECERRA. So, is that an effective way to administer
that program?
Mr. ASTRUE. No. This caught me off guard. I don't think any
previous Commissioner has had to deal with anything like this
before. The first state was California last December. It was,
to me, so nonsensical that, I will be honest, I was caught off-
guard again, because I thought it was a one-off.
I said, ``Well, okay. This is a strange decision. What
other state is going to do this?'' But then there was a steady
pitter pat, and I have probably spent 10 percent of my time
this year trying to get states not to do this.
Mr. BECERRA. Your use of the word ``nonsensical'' is
perhaps the best word I have heard so far about this process
that the governor in California is implementing.
I can't imagine that it helps with any kind of uniform
administration of those disability services when you have
people who can't come in to work, simply because the governor
said, ``You can't come in, even though the Federal taxpayers
are paying the salaries of those individuals as well.''
Mr. ASTRUE. Oh, yes. It's devastating for morale, and we
have seen this. We have had about a dozen states where----
Mr. BECERRA. Right. So let me ask you this, Commissioner.
Under the statutes, you have the ability to declare that the
governor and the State of California are not fulfilling their
obligations under our Federal laws to administer the programs
that they have said that they would accept under the Social
Security Administration's duties, and under the Social Security
Act.
You have written a letter. The response was not positive.
You tell me now what you, as a Commissioner of the Social
Security Administration, and therefore responsible for those
thousands of Californians who are trying to get their claims
processed, will do.
Mr. ASTRUE. We have some statutory authority.
Mr. BECERRA. You have lots of statutory authority. I can
cite you the section. I can read you the underlying portions or
the yellow highlighted portions. You have lots of authority.
You said it. The governor has been acting in a nonsensical
manner when it comes to the ability of Californians who are
disabled, or at least claim to be disabled, to have their
claims processed.
With backlogs that take hundreds of days to process, you
have a governor who has said, ``You're not going to go to work
and process the claims of disabled Californians, even though I,
as governor, have nothing to do with paying you for the work
that you are going to do on behalf of those Californians who
work very hard to have a system in place so they could get
their claims heard.''
Mr. ASTRUE. Right. Certainly there is a factual predicate,
where we would have an obligation to step in. I am not sure I
particularly want to advertise what that line is right now. I
don't think that does anyone any good.
But what I would say is perhaps we should talk offline
about what some of the considerations----
Mr. BECERRA. I will give you my personal phone number, if
you like.
Mr. ASTRUE. Okay.
Mr. BECERRA. Mr. Chairman, you have been gracious with the
time. But, Commissioner Astrue, I hope that you will do
something more than just write a letter, because it is
unconscionable that a chief of state would tell his people that
they will not get services, even though another level of
government is providing every single penny to provide those
services. I think that is only nonsensical, as you said, it's
unconscionable.
I thank you, Mr. Chairman, for the time.
Mr. ASTRUE. If I could just note, Mr. Chairman, we have
actually done a lot more than writing a letter, too. We
actually have been working very closely with the unions and
employee groups. We have intervened and filed, essentially, a
friend-of-the-court brief in one of those cases in support of
one of the unions.
We have been talking to editorial boards. I was actually in
touch with one of the major papers the day before yesterday in
California, talking at some length about this issue. So we are
trying to work this as best we can.
Mr. BECERRA. I apologize if I made the representation that
you were not doing more.
Chairman TANNER. Well, yes, I know you have spoken out in
editorial boards on the East Coast, and I would hope that you
would do so again on the West Coast.
Mr. ASTRUE. Yes.
Chairman TANNER. Ms. Sanchez.
Ms. SANCHEZ. Thank you, Mr. Chairman. Commissioner Astrue,
first I really want to applaud you for the work that SSA has
done over the past year, you know, in the face of, obviously,
very increased demand. SSA has managed to reduce the backlog,
and although it's still longer than many of us would like to
see, progress is being made. First of all, I just want to
commend you for that.
I also want to commend you on your efforts to fight the
furloughs for DDS employees. As somebody from California,
obviously that is an issue that is of special concern to me,
especially given that, as my colleague, Mr. Becerra, said,
California is going to face an increase in the number of
applications, and we are actually seeing a decrease in the
number of those applications that are being processed.
I, too, agree that the furloughing of employees, when it
doesn't cost the state any money to have them working on those
days, is completely unconscionable. I was interested in your
testimony saying that you at first thought California was kind
of an anomaly, and then you had other states come on board. How
many states, all together, are furloughing DDS employees?
Mr. ASTRUE. It fluctuates almost on a week-to-week basis.
The current count is 9 across the board, and I think it's been
higher than that. One of the frustrating things is you put a
lot of effort in and sometimes you think you've won the
discussion. Then all of a sudden there is another round of
fiscal crisis, and then a state legislative meeting and you've
lost.
So, we have put a lot of time and effort into it. I think
at one point we were as high as maybe 15 states.
Ms. SANCHEZ. So you have had a little bit of success in
convincing some of the governors not to do this.
Mr. ASTRUE. We have. Often, to give credit where credit is
due, we have gone to the members of our committees of
jurisdiction, both here and in the Senate, to ask for help,
because often, you carry a lot more weight with governors.
Matter of fact, you always carry more weight with governors
than I do.
Ms. SANCHEZ. Not to, you know, pat the California
delegation on the back, but in February I got members of the
California delegation to send a letter to the governor,
specifically.
Mr. ASTRUE. Yes, you did.
Ms. SANCHEZ. The letter requested the Governor to not
furlough these employees. We got a response back that was
pretty much a non-response.
Do you have a more thorough explanation? Are they giving
you a rationale for why they want to continue to furlough these
employees?
Mr. ASTRUE. Well, the original rationale that they gave us
turned out not to be true, which is that the unions were
insisting on it. In some states, that turned out to be true,
because I think the union positions around the country have
been inconsistent. In California, it turned out that that was
not, in fact, accurate. We ended up, as I mentioned, supporting
litigation from one of the unions in California.
Ms. SANCHEZ. What more can Members of Congress do to help
you try to combat this?
Mr. ASTRUE. I think what you can do, which is not easy, and
maybe in some cases not even fully appropriate for me to do, is
that you are all part of political networks in your home
states. Your majority leaders and minority leaders in your
state legislatures, they need to hear from you on these things.
Sometimes I can't get to the governors. They get walled off
by staff or budget directors, or that type of thing. Usually I
can get through, but not always.
You need, I think, if you're in a state that is having
these issues, to try to educate the political establishment
broadly. Because just getting to one person won't necessarily
solve it over the long run. So, anything that you can do in
that regard would be enormously helpful to us, and we would be
very grateful.
Ms. SANCHEZ. Okay. Switching topics really briefly, last
April I read a New York Times article, the title of which is,
``Insurers faulted as overloading Social Security.''
The story discussed these whistleblower lawsuits against
insurance companies who were forcing their beneficiaries number
one, to file for disability claims with Social Security, and
then to continue to appeal them over and over again if they're
denied. Otherwise, they're not going to pay them benefits under
their policies. I was quite surprised and appalled by this sort
of movement, and the impact that it has on Social Security
resources to process claims.
How much effort is the Administration putting into looking
at the role that outside entities are having in adding to that
backlog?
Mr. ASTRUE. Sure. This issue has sort of heated up in
recent years. We've got a couple of studies going. We've got
some results for private insurers. We are also looking at the
extent to which states are requiring an application to us as
perhaps an inappropriate barrier to welfare benefits in their
own states, as well.
Certainly, we don't condone either of these practices. In
the qui tam action in Boston that I believe generated a lot of
the media coverage, it was a split decision. The insurance
companies lost a few of those cases, they won a few of those
cases. So, clearly, there is abuse. We don't condone that.
Our take so far is that the workload burden from the
private insurance companies from these abuses is relatively
small. We are not persuaded yet that, in certain states, the
comparable practice on the public side might not be more of a
problem. But it has been difficult, getting the data to
determine that. It is taking us longer to run those studies.
So, I would say that for private insurance companies, it's
an issue, but a very small one. We are not sure yet, with the
state agencies, how big a problem it is. We hope by some point
next year to have a better answer to that question.
Ms. SANCHEZ. Okay, thank you. Mr. Chairman, I would just
ask unanimous consent to be able to enter that article into the
record. I will yield back my time.
Chairman TANNER. Without objection.
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Chairman TANNER. Commissioner, before we move to a non-
Californian, may I----
[Laughter.]
Chairman TANNER. May I ask you to provide us with a copy of
the legal filing that you all made in the California case?
Mr. ASTRUE. I would be delighted to, thank you.
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Chairman TANNER. Thank you. Mr. Kind, you are recognized.
Mr. KIND. Thank you. I may not be from California, but my
answers may not be any easier. But, first of all, thank you,
Mr. Chairman, for holding this very important hearing. Mr.
Astrue, thank you for being here.
While progress is being made, and I congratulate you and
thank the Agency for the priority you have placed on the
backlog issue, it's clear more work needs to be done.
Mr. ASTRUE. Absolutely.
Mr. KIND. I also want to thank you for the quick response
that the Agency provided in my request to have video
teleconferencing equipment installed in Lacrosse, Wisconsin,
which had a large number of backlogs.
But that was quickly responded to. The equipment is in.
It's going to reduce now the travel time and the expense and
burden for applicants and their representatives, and the
administrative judges, as far as moving around the state in
order to deal with the huge backlog in western Wisconsin.
Having said that, I also took a chance or a moment before
coming over here to take a look at the processing time in
Madison and Milwaukee, in particular. I know we're facing some
big issues, but if you look at the average processing times for
the hearing offices around the country, I see that Madison
hearing office has an average processing time of 588 days,
which ranks 135 out of 143 offices, nationwide. Milwaukee is
552 days, which is 124 out of 143, both of which have more than
doubled the processing time of the fastest office.
And I am wondering if you have any information to share why
this is occurring in Wisconsin, why the processing time is so
slow there.
Mr. ASTRUE. That's a very fine question. One of the things
that I figured out a few months after I became Commissioner was
that I was walking into a situation with horrible national
backlogs. But when I really had a chance to get deep into the
numbers, it was clear that we had a distribution issue around
the country.
Essentially, the infrastructure of our hearings office
hadn't changed in 20 years. It was the same number of offices
in the same locations with the same number of judges, and the
demographics of the country have changed enormously in that
time period.
As bad as the backlog was in many places in the country, if
I you actually take your fingers on a map of the United
States--I used Madison, Wisconsin on the west, and the eastern
shore of Michigan on the other--and slide down, then start
angling to the east, and then end up in Florida, you see case
filings per administrative law judge a few years ago of three
or four per day. As much as we're pushing for more
productivity, no judge is fast enough to decide that many each
day.
Mr. KIND. Right.
Mr. ASTRUE. In my lifetime, no judge is going to be
deciding, four cases per day. We've got other places, like New
Haven, Connecticut, where they're only taking in half a case
per judge per day. So, there is a misallocation around the
country.
So, we spent a lot of time with the selection of these new
offices looking at the demographics of the country for
population growth and also looking at filing incidence, because
there are some places, like Michigan, that have been in chronic
recession since 2001, where the filing rates are very high, and
we're trying to equalize that around the country.
Mr. KIND. Well, I am glad to hear that you are sensitive to
the caseloads.
Mr. ASTRUE. For Wisconsin, the key thing is that we are
upgrading the satellite office in Madison to a full hearing
office.
Mr. KIND. Yes.
Mr. ASTRUE. GSA is on schedule for that for June of next
year.
Mr. KIND. Well, I appreciate that. Obviously, there are
some issues still.
But, Mr. Chairman, I just received, on November the 6th, a
letter from a friend, an attorney, who represents many Social
Security applicants from western Wisconsin. I would like
unanimous consent to have this introduced to the record at this
time.
Chairman TANNER. Without objection.
[The information follows:]
[GRAPHIC] [TIFF OMITTED] T3016A.049
[GRAPHIC] [TIFF OMITTED] T3016A.050
Mr. KIND. But I want to also just quote from him. There are
some examples of what he has been seeing out there, and in one
particular example, he stated, ``A middle-aged Eau Claire area
woman became disabled when her knees deteriorated to the point
where she needed knee replacements. Her knee conditions have
led to back problems causing chronic pain, for which she has
had to take highly potent narcotic drugs. After waiting nearly
three years for a hearing, the judge finally granted her
benefits within just 10 minutes. And while waiting for her
hearing, her family lost its home to foreclosure, and had to
file for bankruptcy. And after the hearing, he had asked her if
they would have lost their home and had filed for bankruptcy if
she had been getting her Social Security check all along. And
tearfully, she replied, absolutely not.''
``And to add insult to injury, I just received a telephone
message from her just a few days ago, that even though this
client's fully favorable decision was dated August 31 of 2009,
she has still not received her first check or her back pay. She
called the Social Security district office last week, and was
told it could take 90 days for the payment center to get her
into pay status, and to issue her payment for past due
benefits.''
Now, this is not all that atypical, unfortunately, and
this, I think, is the human dimension to the backlog urgency
that we're facing: real people, real problems, and, typically,
some of the poorest and most vulnerable members of our society.
So, the more we can concentrate on that the better, and I
know we have a dual role here, as far as your implementation
and our support in Congress to getting this done. I think it is
important that we continue to see that we do everything we can
to alleviate this type of suffering throughout the country.
Mr. ASTRUE. I'm in absolute agreement. I do think that when
we get through the recession and we go to health IT, we will be
able to cut the time at the state level by more than half.
In the strategic plan that we have laid out, the goal is to
get to an average processing time of 270 days. We still have a
way to go, but that's what we're trying to do.
Mr. KIND. Mr. Chairman, with your indulgence, I just
received word that one of our outreach rural SSA offices has to
be shut down now, because of threats that were being delivered
to the staff there, and, therefore, protective services have
been brought in. They're going to investigate and make sure
that those threats aren't carried out, and something bad
doesn't happen, but I hope this isn't a trend that you are
seeing out there, as far as threats of violence.
Mr. ASTRUE. Sadly, it is. We have a violence report when
there is an actual assault or a serious threat to an employee.
I insist on reading every single one of those. When I started,
I was probably seeing about three of those a week. As the
economy started to unravel, you could see it in these reports,
and I sometimes get 10 a day now. So it's been a very serious
issue.
It is remarkable to me we haven't had any actual loss of
life yet. We have had some very close calls, and it is a scary
thing. I think a lot of times people don't appreciate the
courage of the people on the front line in our offices. They
face a lot of very disturbed, angry people day in, day out and
don't know what people like that are going to do.
Mr. KIND. I echo that. I thank you for acknowledging the
fine work that's being attempted out there for us, too. Thank
you. Thank you, Mr. Chairman.
Chairman TANNER. Thank you. I will call on Mr. Johnson, you
are recognized for a follow-up.
Mr. JOHNSON. Thank you, Mr. Chairman. You know, the idea of
states preventing people from working, like in California as
you just talked about is concerning. How many states are doing
that, do you know?
Mr. ASTRUE. We're up to 10 right now.
Mr. JOHNSON. Ten of them?
Mr. ASTRUE. Mr. Johnson, 10, yes.
Mr. JOHNSON. Have you talked to all of them?
Mr. ASTRUE. I have talked to pretty much all of them, or at
least tried to. I----
Mr. JOHNSON. Well, we pay their salaries, don't we?
Mr. ASTRUE. Yes, and we pay their overhead. Of course, it's
also state taxes that are foregone, too. So they're actually
directly hitting their coffers, as well.
On top of it--and, again, it is more important than just
the fiscal--the people who don't get cash and health benefits
from us are often tapping their other state programs, too. So
it's just a devastatingly nonsensical thing for states to be
doing, from both a moral and fiscal point of view.
Mr. JOHNSON. It's both parties, right?
Mr. ASTRUE. Yes, it's bipartisan. It's split pretty evenly,
Mr. Johnson.
Mr. JOHNSON. Yes.
Mr. ASTRUE. That's right.
Mr. JOHNSON. Thank you. Let me ask you another one. In
August you responded to a letter where you confirm that 1,700
prisoners received benefits erroneously. We know that over
8,000 payments were sent in error to those who died.
Have you recovered all that? And if Congress decides to
send another $250 payment, can you assure us that those
mistakes won't happen again?
Mr. ASTRUE. Not quite. We're almost there, Mr. Johnson. So,
first of all, one of the things it's important, I think, to
recognize is that not all of the prisoner payments were errors.
The legislation was written in a manner that we were supposed
to pay some prisoners. We did indicate at the time----
Mr. JOHNSON. I understand that.
Mr. ASTRUE [continuing]. That we didn't have the databases
for that, and everyone was in a rush----
Mr. JOHNSON. That's because your computer system isn't up
to date.
[Laughter.]
Mr. ASTRUE. Well----
Mr. JOHNSON. Come on.
Mr. ASTRUE. Normally we're not in the business of tracking
prisoners. So, I would certainly encourage you, if there is a
return to another $250 payment, which the Administration and I
support, that Congress reconsiders the approach to prisoners.
That would eliminate the problem, all together.
But we are embarrassed by this. It's not a large amount of
money in the context of $13 billion. We have gone through
several exercises to say, ``What are the lessons learned,''
``Are we ready if we're asked to do this again?''
For the widows, there is almost no lost money. That's all
pretty much been taken care of. They're whittling down on the
prisoners. It's often difficult to get cooperation from the
states. I believe--I will confirm this for the record--it's
fewer than 500 that we're still working on at this point. It's
a work in progress. Hopefully within the next few months we
will have done everything that we need to do on that.
[The information follows:]
[GRAPHIC] [TIFF OMITTED] T3016A.051
Mr. JOHNSON. Thank you, Mr. Chairman.
Mr. ASTRUE. But we're not quite done yet.
Chairman TANNER. Well, in the next few months we want to
stay updated. We may have a follow-up right after the first of
next year, to see how we're doing and see what we can do with
this.
Mr. ASTRUE. Okay.
Chairman TANNER. There are, as Mr. Kind indicated, people
suffering.
Commissioner, thank you very much.
Mr. ASTRUE. Thank you, Mr. Chairman.
Chairman TANNER. We will be back in touch with you quite
soon.
Mr. ASTRUE. Okay. Thank you, Mr. Chairman. Again, thank you
for all your support. We very much appreciate it.
Chairman TANNER. I am going to introduce the next panel
while they are taking their place. Ms. Barbara Kennelly, of
course, is the President and Chief Executive Officer of the
National Committee to Preserve Social Security and Medicare,
and she was here for 23 years and survived, so, Barbara, it is
always good to see you again. We are always glad to have you
back, and we're going to look forward to your testimony.
Also on the panel is Ms. Beth Bates. She works in my
district, in Tennessee, and she is a lawyer who is quite
knowledgeable in these matters. Beth, we are delighted to have
you here.
We also have the Honorable Patrick O'Carroll. Mr.
O'Carroll, of course, as you know, is the Inspector General at
the Social Security Administration. Mr. O'Carroll, thank you
for coming today. I am going to speed this list up.
Ms. Robert, thank you for being here. She is from Chicago,
Illinois, and has much experience in matters of this nature.
Mr. Larry Auerbach, who is the Administrative Law Judge at
the Social Security Administration in the Atlanta office is
also here. We are delighted to have all of you. I apologize for
the hurried introductions, but we've got a time problem, and
it's not our friend at the moment.
Sam, do you have any comments?
Mr. JOHNSON. No.
Chairman TANNER. Congresswoman, you are recognized.
Ms. KENNELLY. I was not here in Congress for 23 years.
Chairman TANNER. You weren't?
Ms. KENNELLY. No.
Mr. JOHNSON. Turn your mic on.
Chairman TANNER. Let's see. It says, ``After a
distinguished 23 years'' in elected public office. I get it.
Ms. KENNELLY. Yes.
Chairman TANNER. Okay.
Ms. KENNELLY. I was a city councilwoman for many years.
Chairman TANNER. Yes.
Ms. KENNELLY. Then I was Secretary of the State of
Connecticut. I was here in Congress for 17 years.
Chairman TANNER. Okay.
Ms. KENNELLY. I was on this Committee.
Chairman TANNER. Well, you escaped all right.
Ms. KENNELLY. Yes. No, no, no. I was on this Committee 16
years.
Chairman TANNER. I know.
Ms. KENNELLY. I loved every single moment that I was here.
Chairman TANNER. Well, we are glad to have you back. Thank
you.
Ms. KENNELLY. I want to tell you, Congressman Johnson, I am
the Acting Chair of the Social Security Advisory Board, and I
was getting prepared for this hearing. I was really kind of
nervous about testifying so I studied last night questions you
asked Syl Scheiber. They were very good questions. Do you
remember them? They were very complicated. I read them three,
four, five times.
Now, you're not going to ask me those today, are you?
[Laughter.]
Ms. KENNELLY. They were wonderful questions. I think that's
what we have to remember, is how important this Committee is,
and how important Social Security is.
Now, I will read my testimony.
STATEMENT OF BARBARA B. KENNELLY, ACTING CHAIR, SOCIAL SECURITY
ADVISORY BOARD
Ms. KENNELLY. I am pleased to appear before you today in my
capacity as the Acting Chair of the Social Security Advisory
Board to discuss the progress SSA has made in clearing the
disability backlogs.
Is the Commissioner still here? Well, he has done a very
good job. There were some old, old, old cases, and he came in,
and he really went at those old cases. I don't have the
figures. Kim, do you have them, or does somebody have them? I
mean, what he did was exceptional, and I think he should get
credit for that.
What I really wanted to thank the Committee for is the
active interest it has taken in reducing the disability
backlogs. But you only could do it as a result of your work.
The appropriation for SSA was nearly $10.5 billion, and the
Recovery Act included an additional $500 million to address the
increased claims due to the recession, and attack the backlog
that had been choking the system, forcing applicants to wait
for years to receive a Social Security check.
As you know, SSA has long struggled with managing its
disability hearings workload. The chief source of the problem
has been years of under-funding, coupled with a growing
caseload. As a result, the President requested $11.45 billion
for SSA, in administrative costs. If SSA had any chance of
keeping up with the influx of claims it will need its full
appropriation.
The fiscal year 2011 budget is now being prepared by OMB.
It is my hope that the President and the Congress will include
sufficient funds in the fiscal year 2011 appropriation to
address both current backlog cases and new claims triggered by
the recession. SSA will need about $950 million, just to
maintain current staffing. In addition, they will need funds to
expand capacity at the disability and the hearing offices to
address backlogs and increased claims.
Earlier this year, the Subcommittee sought the perspectives
of the Advisory Board on the progress made by SSA in using
Recovery Act resources to reduce its disability claims backlog.
In the seven months since the hearing, we have been watching
closely as the Agency has carried out its backlog reduction
initiatives, including 148 new Administrative Law Judges, which
is wonderful.
I mean, hiring 1,000 hearing office support staff,
establishing three national hearing centers, and eliminating
cases that were over 850--and that's what the Commissioner
did--850 days old. That is unacceptable, absolutely
unacceptable. Productivity in the hearings offices has been
steadily increased. ALJs have improved their production, and
nearly three quarters of the judges are clearing between 500
and 700 cases per year.
The Board was briefed on several initiatives underway at
the office of hearings and review that will emphasize data
analysis and processes. One initiative was the development of a
model that stimulates the current work process in order to
identify steps in a process that creates bottlenecks. Some of
these initiatives hold promise.
However, in my view, as the Agency continues to streamline
the hearing process, it is critical that due process for
beneficiaries be maintained. We focused on that when I was on
the Committee. The recent gains in reducing the hearings
backlog are a significant accomplishment. We anticipate that
the Agency will continue to improve its process at that level.
However, SSA is being confronted with a tremendous growth
of new claims. This year SSA received 3 million new disability
claims, 380,000 more than previously expected. This is already
placing significant stress on the DDSs. They have now 783,000
initial claims pending, an 18 percent increase from April.
The rapid increase in unemployment is a major reason for
the unexpected increase in disability applications. Historical
trends document that disability applications rise and fall in
tandem with the unemployment rate. People with disabilities who
previously worked despite their medical conditions are now
unable to find work, and may decide to apply for disability
benefits. These people, combined with the Baby Boomers--I hate
that word ``Baby Boomers,'' it's overused--who are reaching
prime disability age, could raise DDSs claims to 2010 to 3.3
million, according to SSA actuaries.
Although the number of new claims will drop as the
recession eases, earlier cases will still be clogging the
process. A rapid rise in the backlog claims at the initial
stage will have significant consequences for applicants. These
are people facing dire economic circumstances, if they do not
receive a fair and timely disability decision. SSA has pledged
to bring down the current number of initial claims from 783,000
to 525,000 by 2013. But they will need the comprehensive
strategy in order to be successful.
Between now and 2013, SSA may realize some gains in
productivity and efficiency, as more electronic initiatives
come online. But these do not provide relief in the near term.
DDS needs to be adequately funded, and have sufficient staff to
carry out their mission.
In addition, I must remind you that the state furloughs
that have been--you talked about those--are making this problem
worse.
As we look down the road, it is clear that 2010 and 2011
will present extraordinary workloads for the Social Security
Administration. It is imperative that we have the resources and
plans in place to meet the challenge, and to be able to
continue to provide the high quality public service for which
they are known.
Let me tell you. One of the few regrets I have in my life
is I didn't work harder on Social Security when I was on this
Committee. I know you do work hard, Sam. John, you're Chairman,
but let me tell you, this is a huge program. For years, Social
Security was like a nice Subcommittee. It had retirement, it
had disability and it had spousal benefits, but you know what?
It's got much bigger than that. Social Security benefits are a
huge part of our country.
Right now, with the economic situation that we're in, I ask
the two of you to work really hard to make sure that the people
of this country are taken care of, because I've got to tell
you, Social Security is very important to this country.
[The prepared statement of Ms. Kennelly follows:]
Prepared Statement of The Honorable Barbara B. Kennelly, Acting Chair,
Social Security Advisory Board
Chairman Tanner, Mr. Johnson, Members of the Subcommittee. I am
pleased to have this opportunity to appear on behalf of the Social
Security Advisory Board to present the Board's view on the progress
made by the Social Security Administration (SSA) in clearing the
disability backlogs. As you have noted, the agency is facing
unprecedented workloads in the Disability Determination Services at the
same time they are diligently working to bring down the backlogs in the
hearings offices.
Mr. Chairman, I want to thank the Congress and especially this
Subcommittee for the much-needed investment that you have already made
in the Social Security Administration. In FY 2009, Congress provided
SSA with an administrative budget of $10.4 billion--$126.5 million
above the President's budget request. I also want to thank you for the
enactment of the American Recovery and Reinvestment Act, which provided
SSA with another $500 million to process the growing backlog of
disability claims. These funds have helped ensure that the agency is
able to fulfill its vital role in serving the American public.
Through the services it provides, the Social Security
Administration touches the lives of nearly 60 million beneficiaries,
145 million workers and nearly every American. One out of every six
individuals receives monthly cash benefits from Social Security or
Supplemental Security Income (SSI), the major programs that SSA
administers. This fact alone should be an indicator of the importance
of continuous, smooth operations of this agency.
Social Security is an important economic lifeline for millions of
America's most vulnerable people, including aged individuals and
persons with disabilities, as well as their spouses, dependents, and
survivors. In fiscal year 2009, 42.6 million people were receiving
retirement and survivor benefits and another 15.1 million were
receiving disability benefits. SSA processed over 4.7 million
retirement and survivor claims, 2.8 million initial disability claims,
and 661,000 disability hearings during the fiscal year that has just
ended. The agency provided services to the public in general by
processing over 19 million requests for new or replacement Social
Security cards, posting 273 million earnings items to individual
earnings records, answering 67 million calls to its 800-number and
receiving over 45 million visitors to the local field offices.
Over the past 74 years, the agency has been a diligent steward of
the public's trust, overseeing the benefit programs upon which so many
individuals and families depend. In recent years, however, SSA's
ability to fulfill its mission has been severely strained. Chronic
underfunding despite growing workloads has been the chief source of the
problem. In his fiscal year 2010 budget, the President has requested
$11.45 billion for the Social Security Administration. If SSA has any
chance of keeping up with its growing workload, it will need this full
appropriation. The fiscal year 2011 budget is now being prepared by the
Office of Management and Budget. It is my hope that the President and
the Congress will include sufficient funds in the fiscal year 2011
appropriation to address the current backlog of cases as well as the
new recession-driven claims.
Fiscal Year 2009 Accomplishments
It is well known to this Subcommittee that SSA has long struggled
with managing its disability hearings workload. This year, indeed, may
well be a watershed year for the hearing process where new business
processing and management analysis tools have been developed,
electronic service delivery has been improved, and much-needed staff
has been added.
The investment made in SSA has had a significant impact on the
agency's ability to address the disability backlog. They have been able
to do unprecedented hiring--nearly 9,000 new employees. These new
personnel have allowed them to replace retiring staff and expand
critical front-line service in the field offices, the state disability
determination services, and the hearings offices. For the hearings
process, this additional funding gave the Office of Disability
Adjudication and Review (ODAR) the ability to hire 148 Administrative
Law Judges (ALJs), bringing the total ALJ corps up to 1,238 judges as
well as adding 1,000 support staff.
Earlier this year, this Subcommittee sought the perspectives of the
Social Security Advisory Board on the progress made by SSA in using
ARRA resources. When that hearing was held last April, the effects of
the recession were not evident in the hearing appeals process. The
backlogs and long waiting times for a decision were-and still are-a
function of understaffing, lack of a standardized business process, and
fledgling electronic tools that were still being tested. At that time
over 760,000 people were waiting on average nearly 500 days for
disability decisions from Administrative Law Judges.
In the seven months since that hearing, productivity in the
hearings offices has steadily increased; each month the number of
pending claims has declined and the number of people now waiting for a
hearing has decreased nearly five percent. Administrative Law Judges
have improved their average daily production. Nearly three-quarters of
the ALJs are clearing between 500-700 cases per year; this is a 15
percentage point increase over fiscal year 2008. SSA exceeded its
productivity goals by processing almost 14,000 more hearings than
originally estimated and ended the fiscal year with an average
processing time 25 days lower than anticipated in earlier FY 09 budget
estimates.
When SSA developed its hearings backlog reduction plan in 2007,
they acknowledged that too many claims had been allowed to languish
unadjudicated far too long. This year, under the most recent phase of
the ``aged case initiative'' ODAR has cleared over 166,610 cases that
were over 850 days old. At the end of FY 09, less than 1 percent of
hearings pending was 850 days or older. The aged case backlog is now
sufficiently stabilized that they have been able to incorporate new
standard operating business rules that will ensure that the oldest
cases are routinely adjudicated first.
In several of the Board's reports, and most recently in our April
2009 report on improving public service through technology, we stated
that SSA needed to do a better job of integrating electronic service
delivery options into its business process. Growing workloads coupled
with the public's increasing demand for alternative ways to do business
with the agency requires that SSA explore new ways of meeting with
claimants and their representatives and holding hearings. With the
funding received from Congress, SSA has been able to meet that
challenge and the agency has opened three new National Video Hearings
Centers to help process workloads for hearings offices with
exceptionally large backlogs. This increased capacity has resulted in
over 86,000 hearings being held sooner rather than much later.
The recent gains in productivity are a significant accomplishment,
and we fully expect the agency to continue to improve its process.
However, they are now confronted with a tremendous growth in new
claims. As a result, productivity improvements alone will not be
sufficient. There needs to be additional investment in staff. SSA
projects it may lose up to 44 percent of its current employees by 2016.
Within the ALJ corps, 59 percent are retirement-eligible and another 31
percent will become eligible to retire between FY 2010 and FY 2019.
Moreover, new workload projections indicate that they will need to add
approximately 400 more ALJs, bringing the total ALJ corps up to 1,600.
Last April, the Board was briefed on several new initiatives
underway in ODAR. The agency is placing a growing emphasis on data
analysis and process management. They have developed an electronic
business process model that simulates how work currently is processed,
and for the first time, will be able to systematically identify steps
in the process that create bottlenecks or do not add value to the
process. While this initiative is very new, it holds promise for
improving workload management throughout the hearings process. Through
this modeling, ODAR will be able to plan proactively for changes in
receipts and how to redistribute workload, anticipate the need for
changes in staffing mix, and determine what can be mitigated by
improved management practices. The current use is focused on assuring
the success of the agency's plan to reduce the backlog. Going forward,
it will give ODAR the capability to manage proactively, not just
reactively. It is a new direction for ODAR and we hope it will prove
effective.
Growth in workload
The hearings backlogs are still of tremendous concern but become
even more so when they are coupled with the anticipated rise in claims
over the next 10 years. SSA's workload will increase dramatically.
Projections indicate that retirement claims are likely to jump by over
40 percent and disability claims could rise by nearly 10 percent. The
2009 OASDI Trustees Report estimated that by 2015 there will be 50
million retirees, widows and widowers, and dependents receiving
benefits. Those individuals will be expecting efficient and modern
service from the Social Security Administration.
But the anticipated growth in claims does not stop there. The baby
boomers are entering their disability prone years and the number of
initial disability claims is projected to rise steadily over the next
several years, and indeed it has. The Office of the Chief Actuary
(OACT) has carefully tracked the anticipated growth in disability
claims that will be due to the baby boom population. Projections made
in 2007-2008 for the fiscal year 2009 hovered just around the 2.6
million mark. But the reality has been significantly different. In
2009, SSA actually received 3 million new disability claims this year,
about 380,000 more than originally expected.
The most obvious factor impacting the volume of disability
applications today is the recession with its significant increase in
unemployment. Recent history demonstrates that disability applications
generally rise and fall in tandem with the unemployment rate. The DI
application rate per 1,000 workers among non-elderly adults rose 37%
from 1989 to 1993 (from 8.3 per 1,000 workers to 11.5), and by 49% from
1999 to 2003 (from 8.8 per 1,000 workers to 13.1). One exception was
seen from 1980 to 1984 when eligibility for disability was
significantly curtailed while unemployment soared.
The logic is straightforward. In a recession with widespread
unemployment, people with disabilities who previously worked despite
their condition may find themselves without a job, especially people
with fewer skills or who are approaching retirement. These people may
be more likely to apply for disability benefits to support themselves
and their families. The recession may speed up an application that
might have been made later or it may encourage more individuals who
think that they might have a disabling condition to apply for benefits.
What does this mean for SSA's disability workload? The 15 percent
increase in new initial claims experienced in fiscal year 2009 has put
extraordinary stress on the DDS system. Backlogs are climbing and there
are now 783,000 initial claims pending in the DDSs. This is an 18
percent increase since April. And it is anticipated that these backlogs
will grow. More recent projections by SSA's actuaries estimate that DDS
claims in 2010 will peak at 3.3 million, and stay just above 3 million
through 2012. SSA expects pending claims in the DDS to climb to 1
million by the end of 2010. These claims forecasts may increase or
decrease as unemployment figures change.
Tackling the Initial Claims Workload
SSA has acknowledged that the pending level of initial claims in
the DDSs is unacceptable and they have pledged to bring the pending
workload down to 525,000 by fiscal year 2013. Their strategy to reduce
this backlog includes additional hiring and overtime in the DDSs. With
the additional funding provided by Congress this year, the DDSs were
able to hire 1,400 new disability examiners. Even though they were not
fully engaged for the entire year, these new hires were instrumental in
processing an additional 30,000 claims.
SSA's electronic folder makes it fairly easy to transfer work to
other offices. An element of the agency's current plan includes
shifting work out of heavily-impacted DDSs and into offices, including
the federal quality assurance units, where there is excess capacity. In
addition, SSA is in the process of establishing four ``mega-DDSs''.
Similar to the National Hearings Centers, these state mega-DDSs will be
able to provide assistance to overloaded DDSs from anywhere in the
country.
The agency also continues to improve and expand their
``compassionate allowance'' and ``quick disability decision''
processes. These tools, combined with ongoing policy simplification
initiatives may help to speed up decision making and free up valuable
disability examiners for the more complex cases.
Need for a comprehensive workload strategy
As SSA works to reduce its disability backlog and address the
influx of new claims, the agency should be encouraged to develop a
comprehensive strategy. This would include establishing a plan for
processing initial claims just as it has created a plan for processing
appeals in a more timely and efficient manner.
It strikes me that the DDSs are in a position similar to the one
that the hearings offices were in about two years ago. They have
suffered staffing losses and had some success with electronic
adjudication tools. However, electronic tools alone are not enough to
offset the reductions in disability examiners and medical staff and the
increase in caseloads. SSA has relied to date on shifting workloads
across offices and ramping up productivity, but nothing will work
without funding for additional staff. We do not want to produce
efficiency at the expense of due process.
SSA has a number of electronic initiatives under development
including electronic medical evidence (EME) and health information
technology (HIT) tools that may hold long-term promise. Recently, the
Board was briefed on the scope and timeline for the EME and HIT
initiatives. We are encouraged by these initiatives. SSA has a basic
plan for development and implementation and is making good use of the
ARRA funding. We appreciate the work that is going on within the
organization. Over the next three years, SSA should have several
projects underway which could greatly enhance the electronic exchange
of medical evidence. If effectively implemented, they should improve
timeliness of disability decisions and enhance public service.
Similarly, work continues on the development of a single DDS case
processing system which will streamline case processing, improve data
sharing, and help to improve management.
The longer-range strategies for improving the disability process
are necessary, but they do not provide relief in the near term for the
hundreds of thousands of vulnerable individuals who have turned to the
Social Security Administration for assistance. We believe that a
comprehensive backlog reduction plan-similar to the one developed for
ODAR--should be instituted for the DDSs. Working with the DDSs, the
agency should be able to identify and adapt the best practices from the
hearings backlog reduction plan; in addition consideration should be
given to accelerating the eCat disability adjudication analysis tool.
SSA and its state partners must move swiftly to staff fully the mega-
DDSs and establish the criteria that will be used for obtaining
workload assistance from these centers.
There is one caution I need to raise: the backlog reduction plan in
the DDSs cannot come at the expense of well-reasoned and high quality
decisions based on a well-developed evidentiary record. Rushing cases
out the door to meet production goals does not, in the end, improve
service to the American public. DDSs need to be adequately funded and
have sufficient staffing to carry out the job. I do not need to remind
this Subcommittee that the furloughs that have been imposed by States
on nine DDSs slow the progress in reducing the backlogs and undermine
the quality of public service. These issues need to be resolved as
quickly as possible.
Beyond 2010
It is only a matter of time that the surge in initial claims is
felt in ODAR. If the traditional waterfall of appeals occurs, about 45
percent of those denied at the initial level will request
reconsideration, and then approximately three-quarters of the
individuals who are denied at the reconsideration level will appeal to
the ALJ. It takes about 250 days, on average, for an initial claim that
has been appealed to reach ODAR and then several more months before the
case is on an ALJ's desk. This means that the increased caseloads in
the DDSs will begin to materialize in ODAR in the second half of 2010
or in early 2011. Without continuing assistance from the Congress,
these disability cases could take several years to work their way
through the agency.
As we look down the road, it is clear that fiscal year 2011 will
present extraordinary workload levels throughout the Social Security
Administration. It is imperative that the agency has the resources and
tools in place to meet this challenge and to be able to continue to
provide the high-quality public service for which it is known.
Thank you for inviting me to appear before you today. I will be
pleased to answer any questions you may have.
Chairman TANNER. Thank you. Thank you for all your service,
and your testimony. We will ask unanimous consent that Members
may submit written questions to you all if we run out of time
here. Thank you.
Ms. Bates, welcome from west Tennessee. You're recognized
for five minutes.
STATEMENT OF BETH BATES, CLAIMANTS' REPRESENTATIVE, ON BEHALF
OF THE CONSORTIUM FOR CITIZENS WITH DISABILITIES, JACKSON,
TENNESSEE
Ms. BATES. Thank you, Mr. Chairman, Ranking Member Johnson,
and Members of the Subcommittee. Thank you for inviting me to
testify here today on behalf of the Consortium for Citizens
with Disabilities Social Security Task Force.
I have represented individuals with Social Security and SSI
claims for more than 25 years. I would like to thank the
Chairman and his district office staff in Union City and
Jackson for a great deal of help over the years.
Social Security finds itself at a critical crossroads. For
the first time in a decade in fiscal year 2009, the backlog at
ODAR, the third level of disability adjudication, was reduced
from the previous year. That was both in number of pending
cases, the length of time that they pended, and in processing
time.
At the same time, we think because of the recession, there
was a huge increase in the backlog of cases at the first two
levels of adjudication, the State DDSs. About 40 percent,
nationwide. I suggest respectfully that this increase in the
backlog there, largely due to the numbers of new cases,
threaten the goal of Social Security to eliminate the backlog
at ODAR by the year 2013.
I am honored to be here, but I am saddened, because I see
the suffering caused by the backlog with my clients. My client,
Mr. H, who lives in Huntington, Tennessee is all too typical.
When I met him in early 2008, he and his teenage son were
homeless. They were staying in a dangerous area, and in a
motel.
He had a--Mr. H had a history of arthritis, liver disease,
coronary artery disease, depression, adult attention deficit
disorder. He had worked as a grocery bagger and as a sawmill
laborer. He had been out of the work force for some time,
caring for his invalid mother, who subsequently became too ill
to stay at home, and had to go to a nursing facility.
Unfortunately, Mr. H was turned down twice at the
Disability Determination Section, and requested a hearing in
January of 2009. He is still waiting. He is waiting at
Nashville ODAR. The ODARs where I practice, Nashville and
Memphis, while slightly better than Madison and Milwaukee, they
had lost ground in the year 2009, and the processing time has
actually increased.
I think that Tennessee, unfortunately, is a good example of
the problems with the backlog. In 2009, Tennessee's backlog
increased from--increased to 66 percent at the first 2 levels.
That was in the top 10 in the nation. That was above the 40
percent, nationwide.
The director of DDS has been good to work with. Other
advocates, colleagues of mine, have tried to improve the
process. But Tennessee is third from the bottom in approvals at
the initial and reconsideration stage. I say that's a double
whammy that's going to hit the five ODARs in Tennessee, and in
particular, Memphis and Nashville, that seem to have the
biggest backlog.
I am an optimistic person. But, absent additional resources
in 2010, which I think are on target, and 2011, I can't say but
that it will get worse, because we have cost of living and
overhead type issues there.
I do appreciate what the committee has done, and the
Congress has done in 2008 and 2009--as other witnesses have
indicated--and have marked up for 2010, but I think we are
going to need even more in 2011 to maintain the progress that
has been made.
We support many of the other non-dollar initiatives that
the Commissioner has suggested, such as increased technology,
the senior attorney adjudicator program. We just have one word
of caution, that any proposals--we don't want our clients' due
process rights to be jeopardized. We want the folks who are
eligible under the law to receive the benefits that they need
for their basic necessities of life.
Thank you.
[The prepared statement of Ms. Bates follows:]
Prepared Statement of Beth Bates, Claimants' Representative, on behalf
of the Consortium for Citizens with Disabilities, Jackson, Tennessee
Chairman Tanner, Ranking Member Johnson, and Members of the House
Ways and Means Social Security Subcommittee, thank you for inviting me
to testify at today's hearing on ``Clearing the Disability Claims
Backlogs: The Social Security Administration's Progress and New
Challenges Arising From the Recession.'' I am honored to testify today
but am saddened that the reason is because my clients have waited so
long and endured many hardships before receiving the disability
benefits to which they are entitled.
I am an attorney in Jackson, TN, and a member of the National
Organization of Social Security Claimants' Representatives (NOSSCR).
For more than 25 years, I have represented individuals with
disabilities in their claims for Social Security and Supplemental
Security Income (SSI) disability benefits. I am testifying today on
behalf of the Consortium for Citizens with Disabilities (CCD) Social
Security Task Force, of which NOSSCR is an active member. CCD is a
working coalition of national consumer, advocacy, provider, and
professional organizations working together with and on behalf of the
more than 54 million children and adults with disabilities and their
families living in the United States. The CCD Social Security Task
Force (hereinafter CCD) focuses on disability policy issues in the
Title II disability programs and the SSI program.
The focus of this hearing is extremely important to people with
disabilities. Title II and SSI cash benefits, along with the related
Medicaid and Medicare benefits, are the means of survival for millions
of individuals with severe disabilities. They rely on the Social
Security Administration (SSA) to promptly and fairly adjudicate their
applications for disability benefits. They also rely on the agency to
handle many other actions critical to their well-being including:
timely payment of the monthly Title II and SSI benefits to which they
are entitled; accurate withholding of Medicare Parts B and D premiums;
and timely determinations on post-entitlement issues that may arise
(e.g., overpayments, income issues, prompt recording of earnings).
Because the economic downturn has led to an unexpected surge of new
applications, SSA finds itself at a critical crossroads. The wave of
new claims is having a very significant impact at the state Disability
Determination Services (DDSs) that will eventually affect the hearing
level. At the DDS levels (initial and reconsideration), the number of
new applications, applications waiting for a decision, and processing
times are all on the rise. In fiscal year (FY) 2009, SSA received
385,000 new claims, an increase of nearly 15% since the end of FY 2008.
Even more worrisome is the growing backlog of pending initial claims at
the DDSs, i.e., those waiting for a decision, up nearly 40% since the
end of FY 2008.
In FY 2009, the news was more positive at the hearing level. For
the first time in a decade, SSA finished FY 2009 with fewer hearing
level cases waiting for a hearing and decision than at the beginning of
the year. But we are deeply concerned that any progress in eliminating
the hearing level backlog will be delayed as the surge of new
applications are denied and then are appealed, putting SSA's plan to
eliminate the hearing level backlog by 2013 at risk.
While recent appropriations have allowed SSA to hire some new staff
and to reduce processing times at the hearing level, these amounts will
not be adequate to fully restore the agency's ability to carry out its
mandated services. Given the many years of under-funding and the need
for more than a $600 million annual increase just to keep up with fixed
costs, additional funding is required to reduce and eliminate the
backlog at the DDS and hearing levels and to provide essential services
to the public. While the current situation is dire, without adequate,
ongoing appropriations to fund SSA, the forward progress recently made
by the agency will deteriorate, leaving people with severe disabilities
to wait years to receive the benefits to which they are entitled.
THE IMPACT ON PEOPLE WITH DISABILITIES
As the backlog in decisions on disability claims continues to grow,
people with severe disabilities have been bearing the brunt of the
delays. Behind the numbers are individuals with disabilities whose
lives have unraveled while waiting for decisions--families are torn
apart; homes are lost; medical conditions deteriorate; once stable
financial security crumbles; and many individuals die.\1\ Numerous
recent media reports across the country have documented the suffering
experienced by these individuals. Your constituent services staffs are
likely to be well aware of the situations faced by people living in
your districts and they provide valuable assistance. I have had many
contacts with Chairman Tanner's district offices in Jackson and Union
City, Tennessee. His staff has been extremely helpful, when they are
able to assist.
---------------------------------------------------------------------------
\1\ If a claimant dies while a claim is pending, the SSI rule for
payment of past due benefits is very different--and far more limited--
than the Title II rule. In an SSI case, the payment will be made in
only two situations: (1) to a surviving spouse who was living with the
claimant at the time of death or within six months of the death; or (2)
to the parents of a minor child, if the child resided with the parents
at the time of the child's death or within six months of the death. 42
U.S.C. Sec. 1383(b)(1)(A) [Section 1631(b)(1)(A) of the Act]. In Title
II, the Act provides rules for determining who may continue the claim,
which includes: a surviving spouse; parents; children; and the legal
representative of the estate. 42 U.S.C. Sec. 404(d) [Section 202(d) of
the Act]. Thus, if an adult SSI claimant (age 18 or older) dies before
actually receiving the past due payment and if there is no surviving
spouse, the claim dies with the claimant and no one is paid.
---------------------------------------------------------------------------
Backlog in Appeals of Disability Claims: The Human Toll
I have represented individuals in their Social Security and SSI
disability claims since 1984 at all administrative and judicial levels.
My clients' hearings are held by Administrative Law Judges (ALJs) in
the Memphis and Nashville, TN, hearing offices of SSA's Office of
Disability Adjudication and Review (ODAR). Like the growing number of
initial applications and hearing requests, my client caseload has grown
by 40%. I have noticed that my clients are waiting longer and longer
for hearings to be scheduled. The experiences of several of my clients
illustrate the hardships endured by many claimants waiting for a
decision on their claims and for payment of awarded benefits:
Mrs. W lives in Dyersburg, TN, with her husband and
young family. She is illiterate and reclusive. She and her family
receive much assistance from older family members. She applied for
disability benefits on August 7, 2008, based on mental retardation. She
was denied despite psychological evaluations showing IQ scores in the
60s and deficits in adaptive function. As her attorney, I asked for a
decision on the record both at the Disability Determination Services
(DDS) and hearing levels. Her claim was denied by the DDS and her
hearing request was filed on February 20, 2009. She is still waiting
for a hearing date.
Mr. H lives in Huntingdon, TN. When he first retained me
on April 3, 2008, he and his teenage son were homeless. They were
forced to stay in a motel in a dangerous area. I filed an online
disability report; Mr. H completed SSI and Social Security disability
applications. Mr. H had worked as a sawmill laborer and a grocery
bagger. He had been out of the workforce for a time caring for his
invalid mother until her health worsened and she had to enter a nursing
facility. Mr. H suffers from liver disease, arthritis, coronary artery
disease, depression and adult attention deficit disorder. Fortunately,
he and his son were able to move into public housing. He was denied at
the first two levels by the Tennessee DDS and requested a hearing on
January 23, 2009. He is still waiting for a hearing date. Mr. H and his
son live on state welfare benefits of approximately $185 per month plus
food stamps.
Mr. M is homeless and has been diagnosed with bipolar
disorder. He has recent suicide attempts. I began to represent him in
April 2008. He had previously requested a hearing while living near
Tampa, FL. His brother, who lives in rural western Tennessee, attempted
to rescue Mr. M. However, Mr. M decompensated in the summer of 2008 and
had to be hospitalized at Western State Mental Hospital in Tennessee.
Upon discharge, he was released to a group home in Nashville, some 100
miles away from his brother. He lived for almost a year in the group
home and now has a supportive housing apartment. He has no income. Mr.
M's hearing is scheduled on December 17, 2009, some 18 months after he
came to Tennessee. I have previously requested on the record decisions
twice, but have received no response to my requests.
Most claimants' representatives have clients who have faced similar
difficult circumstances to those endured by mine, including
deteriorating health and even death, due to lack of health insurance
and access to necessary medical treatment, sometimes as simple as
antibiotics. Foreclosures and bankruptcies have increased, with
claimants losing their homes and vehicles and their economic stability.
I have included more descriptions of other claimants and the hardships
they have faced at the end of my statement, starting on page 12.
SSA'S NEED FOR ADEQUATE RESOURCES TO ADDRESS GROWING BACKLOGS
For many years, SSA did not receive adequate funds to provide its
mandated services, a key reason for the hearings backlog. Between FY
2000 and FY 2007, the resulting administrative funding shortfall was
more than $4 billion. The dramatic increase in the hearing level
disability claims backlog coincided with this period of significant
under-funding.
Recent Congressional efforts to provide SSA with adequate funding
for its administrative budget have been encouraging. In FY 2008, the
tide finally changed for the first time in a decade, when Congress
appropriated $148 million over the President's budget. The FY 2009 SSA
appropriation provided SSA with more than $700 million over the FY 2008
appropriation.
We are extremely grateful to Congress for recognizing SSA's need
for adequate resources and including additional funds for SSA in the
American Recovery and Reinvestment Act of 2009 (ARRA). ARRA provided
SSA with $500 million to handle the unexpected surge in both retirement
and disability applications due to the economic downturn. SSA also
received badly needed funds to replace its aged National Computer
Center. With the FY 2009 appropriation and the ARRA funding, SSA
planned to hire 5,000 to 6,000 new employees, including 147 new ALJs
and 850 hearing level support staff. This additional staff undoubtedly
led to SSA's ability to make progress on the backlog at the hearing
level.
Congress appears to be moving towards providing SSA with an FY 2010
appropriation approximately the same as President Obama's request of
$11.45 billion for SSA's Limitation on Administrative Expenses (LAE), a
10 percent increase over the FY 2009 appropriation. While the agency is
operating under a Continuing Resolution, we are optimistic that SSA's
final FY 2010 appropriation will be similar to the $11.45 billion
amount, allowing SSA to hire more staff, including 226 additional ALJs
and support staff.
WILL THE HEARING LEVEL BACKLOG BE ELIMINATED BY 2013?
The most significant delays in SSA's disability determination
process are at the hearing level. The average processing time for cases
at the hearing level has increased dramatically since 2000, when the
average time was 274 days. In FY 2009, the average processing time for
disability claims at the hearing level was 491 days, about 16.5 months.
We appreciate the effort by SSA to reduce the processing time, but an
average of 16.5 months--close to one and a half years--is still too
long for individuals waiting for a hearing decision. In addition, the
average processing times at the initial and reconsideration levels are
increasing. For individuals with disabilities who have no health
insurance, have lost their homes, have declared bankruptcy, or who have
died, that is simply too long to wait.
The current processing times in some hearing offices are striking,
and much longer than the 491-day average at the end of FY 2009. It is
important to keep in mind that this is an ``average'' and that many
claimants will wait longer. In September 2009, the average processing
time at 48 hearing offices was above the 491 day national average, with
20 offices over 600 days.
Is the Hearing Backlog Improving? By the end of FY 2009, it was
clear that ODAR was making slow but steady process in key areas to
address its backlog and improve processing times, thanks to the hard
work of ODAR ALJs and staff and the additional resources available due
to Congressional appropriations, including the ARRA funding.
Pending cases. For the first time in a decade, ODAR
finished FY 2009 with fewer hearings pending than in the prior year.
The increased resources, including 147 new ALJs and support staff are
having a positive impact at the hearing level. The pending number of
cases dropped for nine straight months from a record high of 768,540 in
December 2008 to 722,822 in September 2009. This is the lowest pending
number of ODAR cases since February 2007. The pending number dropped by
11,377 in September 2009 alone, the biggest drop in FY 2009. The
reduction in pending cases is even more notable since the number of
requests for hearing increased in FY 2009, up to 625,003, a 5.7%
increase over the 591,888 received in FY 2008.
Processing times. The average process time in September
2009 was 472 days, the lowest monthly processing time since November
2005. The average processing time for all of FY 2009 was 491 days, down
from 514 days in FY 2008.
Dispositions. The number of dispositions cleared by ALJs
on a daily basis was 2,940.47 in September. This is the highest monthly
average since records have been kept, beginning in FY 2004. The
increase is concomitant with the record number of ALJs now on duty. For
the year, dispositions were up about 20%.
Age of pending cases. The length of time cases are
pending is also improving. The percentage of requests for hearing
pending over one year was 31% in September 2009. This is the lowest
percent since October 2004. The average age of a pending case is 282
days. It peaked this year at 317 days in January 2009.
Improvement Is Not Uniform. Despite the overall improvement in the
hearing level statistics, not every hearing office has benefited and
some claimants are waiting even longer than one year ago. On one hand,
some offices have experienced exceptional improvement in processing
times, as much as 4 to 5 months in just one year, for example: Madison,
WI; Houston-Bissonet, TX; and Long Beach, CA. In contrast, other
offices continue to experience worsening times that are several months
longer than last year, for example: Memphis, TN; Louisville, KY; and
Bronx, NY. A comparison of processing times at the end of FY 2009 and
FY 2008 for hearing offices in or near the districts of Subcommittee
Members reflects this disparity and the fact that much work lays
ahead.\2\
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\2\ The processing times reflect the times at the end of September
in the respective fiscal year.
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California: Los Angeles Downtown: 362 days (FY09) vs. 376 days
(FY08); Los Angeles West: 492 days (FY09) vs. 525 days (FY08); Long
Beach: 351 days (FY09) vs. 533 days (FY08)
Florida: Tampa: 539 days (FY09) vs. 622 days (FY08)
Kentucky: Lexington: 452 days (FY09) vs. 448 days (FY08);
Louisville: 545 days (FY09) vs. 465 days (FY08)
New York: Bronx: 605 days (FY09) vs. 516 days (FY08); Manhattan:
490 days (FY09) vs. 420 days (FY08); Queens: 482 days (FY09) vs. 446
days (FY08)
North Dakota: Fargo: 448 days (FY09) vs. 485 days (FY08)
Ohio: Columbus: 630 days (FY09) vs. 771 days (FY08)
Pennsylvania: Elkins Park: 360 days (FY09) vs. 402 days (FY08);
Philadelphia: 350 days (FY09) vs. 386 days (FY08); Philadelphia East:
377 days (FY09) vs. 422 days (FY08)
Tennessee: Memphis: 538 days (FY09) vs. 442 days (FY08); Nashville:
501 days (FY09) vs. 475 days (FY08)
Texas: Dallas Downtown: 367 days (FY09) vs. 463 days (FY08); Dallas
North: 331 days (FY09) vs. 403 days (FY08); Fort Worth: 306 days (FY09)
vs. 372 days (FY08); Houston-Bissonet: 328 days (FY09) vs. 471 days
(FY08); Houston Downtown: 340 days (FY09) vs. 298 days (FY08); San
Antonio: 330 days (FY09) vs. 427 days (FY08)
Washington: Seattle: 511 days (FY09) vs. 551 days (FY08)
Wisconsin: Madison: 488 days (FY09) vs. 652 days (FY08); Milwaukee:
627 days (FY09) vs. 658 days (FY08)
SIGNIFICANT INCREASE IN NEW CLAIMS FILED AND GROWING DDS BACKLOGS
Since the end of FY 2008, new disability claims filed have been
climbing steadily, up nearly 15% by the end of FY 2009. But what is
more troubling is how the increase grew throughout FY 2009: December
2008 Quarter: 6.92%; March 2009 Quarter: 15.23%; June 2009 Quarter:
16.32%; September 2009 Quarter: 20.25%.
The most alarming trend is the increase in the number of pending
claims (initial and reconsideration levels), up 38.8% since the end of
FY 2008 and climbing from 763,183 to 1,059,241. This means that, at the
end of FY 2009, more than 1 million disability applicants were waiting
for a decision on their claims at the initial and reconsideration
levels. When you add the 722,822 pending cases at the hearing level,
nearly 1.75 million people with disabilities were waiting for a
decision. If the new applications continue to increase at the higher
level seen in recent months, the total number of pending initial
applications alone in the DDSs could hit over 1,000,000 claims by the
end of FY 2010. This would be an 80% increase in pending initial claims
in just one year.
Claimant representatives in some states, including myself in
Tennessee, have noticed the increase in processing times. This is not
surprising since the percentage increase of pending cases in some
states is much higher than the national average. For example, at the
initial level, the number of pending claims increased nationwide by
38.1% at the end of FY 2009, compared to the end of FY 2008. However,
in my state of Tennessee, the increase was 66.2%. Other states with
significantly higher percentage increases in pending initial level
claims include: North Dakota (68.5%); Ohio (59.3%); and Texas (55.8%).
What does the increase in applications and pending claims at the
DDSs mean for the hearing level? Approximately 22% of the initial
claims will result in a hearing request. This means there is a
potential increase of 85,000 additional hearings just from the FY 2009
applications, a statistic that underscores the fragility of the ODAR
progress accomplished in FY 2009.
Looking more closely at the situation in my state of Tennessee,
there is reason to be concerned. The increase in new claims will
contribute to worsening a difficult situation at the hearing level.
Tennessee had one of the biggest increases in pending claims in FY 2009
(66.2%), which was much higher than the national average. Historically,
Tennessee has had one of the lowest DDS allowance rates. In FY 2008,
the Tennessee DDS allowed only 25.1% of initial claims (vs. a 36.0%
national average) and only 8.7% of requests for reconsideration (vs. a
13.8% average). Out of 52 DDSs, Tennessee rated 50th, slightly better
than only Mississippi and Georgia. As noted above, the processing times
at both the Memphis and Nashville ODAR hearing offices did not improve
in FY 2009 but rather grew worse--Memphis by nearly 100 days or more
than 3 months, and Nashville by 26 days or nearly one month. All of
these trends--increased applications, a very low DDS allowance rate,
and worsening hearing level processing times--do not bode well for my
clients and other individuals in the state. As a result, I fear that
things will get worse before they get better.
Exacerbating the problem of a significant increase in new claims is
the impact on DDSs of state budget crises. Even though DDS salaries,
offices, and overhead are fully funded by SSA, some states are imposing
hiring restrictions and furloughs of employees, including DDS workers,
because of budget problems. Earlier this year, Commissioner Astrue
wrote to Governors, asking them to exempt DDSs from hiring freezes and
furloughs. In September 2009, Vice-President Biden sent a letter to
Gov. Edward Rendell, the Chair of the National Governors' Association,
also urging that states exempt DDS employees from state furloughs.
These furloughs lead to loss of administrative funding for the state
DDSs and, more importantly, delay payment of benefits to disabled
beneficiaries.
SSA's ABILITY TO PERFORM OTHER IMPORTANT WORKLOADS
Program Integrity Workloads. The processing of continuing
disability reviews (CDRs) and SSI redeterminations is necessary to
protect program integrity and avert improper payments. Failure to
conduct the full complement of CDRs would have adverse consequences for
the federal budget and the deficit. According to SSA, CDRs result in
$10 of program savings and SSI redeterminations result in $7 of program
savings for each $1 spent in administrative costs for the reviews.
However, the number of reviews actually conducted is directly related
to whether SSA receives the necessary funds. In addition, it is
important, when it conducts work CDRs, that SSA assess whether reported
earnings have been properly recorded and ensure that it properly
assesses whether work constitutes substantial gainful activity (SGA).
Impact on Post-Entitlement Work. Staffing shortages also have led
to SSA's inability to fully carry out many other critical post-
entitlement workloads. One area that has slipped, often with a very
detrimental impact on people with disabilities, is the processing of
earnings reports by beneficiaries. When beneficiaries faithfully notify
SSA of earnings or other changes that may reduce their benefit payment
amounts, it may be months or years before SSA sends an overpayment
notice to the beneficiary, demanding repayment of sometimes tens of
thousands of dollars of accrued overpayments. It is shocking to
beneficiaries to receive these notices, when they reasonably assumed
that SSA had processed the information they submitted, and it is
challenging, if not impossible, for someone subsisting on benefits
alone to repay the overpayments. Many individuals with disabilities are
wary of attempting a return to work out of fear that this may give rise
to an overpayment, resulting in a loss of economic stability and health
care coverage upon which they rely.
SSA needs to develop a better reporting and recording system and
promptly adjust benefit payments--thus preventing these overpayments.
It is important to note that, in and of themselves, overpayments do not
indicate fraud or abuse as beneficiaries are encouraged to work if they
are able. The problems arise when reported earnings are not properly
recorded and monthly overpayments are not properly adjusted.
CCD RECOMMENDATIONS REGARDING SSA's ADMINISTRATIVE FUNDING
We are optimistic that SSA will receive a final FY 2010
appropriation of $11.451 billion for SSA's LAE, the same amount
proposed by the President. SSA will use this funding and about $350
million from the ARRA funding to address the growing workloads facing
the agency. Based on these funding levels, during FY 2010, SSA will be
spending at least $11.8 billion to address the current staffing levels
and associated costs necessary for the agency to function.
In FY 2011, SSA will be faced with additional costs of nearly $620
million just to deal with inflationary costs associated with items such
as salaries, benefits, rents, and facility security. The resulting
funding level, $12.42 billion will not address the increased number of
new claims, the newly created DDS backlog, and SSA's plan to eliminate
the hearing level backlog by 2013. To address these workloads, SSA will
need additional resources. We estimate that an additional $780 million
will be necessary--at least $480 million to address the increased
number of disability claims and at least $300 million to continue
making progress in reducing and eliminating the hearings backlog by
2013.
To address the unprecedented increase in workloads and to prevent a
severe disruption in service delivery, we recommend that a minimum of
$13.2 billion be included in the FY 2011 President's budget request for
SSA's administrative funding.
RECOMMENDATIONS FOR IMPROVING THE DISABILITY CLAIMS PROCESS
Money alone will not solve SSA's crisis in meeting its
responsibilities. Commissioner Astrue is committed to finding new ways
to work better and more efficiently. CCD has numerous suggestions for
improving the disability claims process for people with disabilities.
We believe that these recommendations and agency initiatives, which
overall are not controversial and which we generally support, can go a
long way towards reducing, and eventually eliminating, the disability
claims backlog.
Caution Regarding the Search for Efficiencies
While we generally support the goal of achieving increased
efficiency throughout the adjudicatory process, we caution that limits
must be placed on the goal of administrative efficiency for
efficiency's sake alone. The purposes of the Social Security and SSI
programs are to provide cash benefits to those who need them and have
earned them and who meet the eligibility criteria. While there may be
ways to improve the decision-making process from the perspective of the
adjudicators, the critical measure for assessing initiatives for
achieving administrative efficiencies must be how they affect the very
claimants and beneficiaries for whom the system exists.
People who find they cannot work at a sustained and substantial
level are faced with a myriad of personal, family, and financial
circumstances that will have an impact on how well or efficiently they
can maneuver the complex system for determining eligibility. Many
claimants will not be successful in addressing all of SSA's
requirements for proving eligibility until they reach a point where
they request the assistance of an experienced representative. Many face
educational barriers and/or significant barriers inherent in the
disability itself that prevent them from understanding their role in
the adjudicatory process and from efficiently and effectively assisting
in gathering evidence. Still others are faced with having no ``medical
home'' to call upon for assistance in submitting evidence, given their
lack of health insurance over the course of many years. Many are
experiencing extreme hardship from the loss of earned income, often
living through the break-up of their family and/or becoming homeless,
with few resources--financial, emotional, or otherwise--to rely upon.
Still others experience all of the above limits on their abilities to
participate effectively in the process.
Proposals for increasing administrative efficiencies must bend to
the realities of claimants' lives and accept that people face
innumerable obstacles at the time they apply for disability benefits
and beyond. SSA must continue, and improve, its established role in
ensuring that a claim is fully developed before a decision is made and
must ensure that its rules reflect this administrative responsibility.
Technological Improvements
Commissioner Astrue has made a strong commitment to improve and
expand the technology used in the disability determination process. CCD
generally supports these efforts to improve the disability claims
process, so long as they do not infringe on claimants' rights. Some of
the technological improvements that we believe can help reduce the
backlog include the following:
1. The electronic disability folder. The initiative to process
disability claims electronically has the prospect of
significantly reducing delays caused by the moving and handing-
off of folders, allowing for immediate access by different
components of SSA or the DDS, and preventing misfiled evidence.
2. Expanding Internet access for representatives. Under
Electronic Records Express (ERE), registered claimant
representatives are able to submit evidence electronically
through an SSA secure website or to a dedicated fax number,
using a unique barcode assigned to the claim. This initiative
holds great promise, given that significant problems with the
current process exist.
Under the current process, representatives are to be
provided with a CD of the exhibited or ``pulled'' file shortly
before the hearing and earlier in the process after the appeal
has been filed but before the file is exhibited. Due to
staffing shortages in hearing offices, I have had problems
obtaining the CDs and even obtaining barcodes, which allows me
to submit evidence electronically. Receiving incomplete CDs
leads to problems. I am unable to know what evidence is in the
record so that I can determine what evidence I need to obtain
and submit. This also can lead to submission of duplicate
evidence, which is time-consuming for ODAR staff but is the
only way that I can ensure that ODAR has received the evidence.
This can cause significant delay both during and after the
hearing.
We are optimistic that these problems will be resolved in
the near future. I am very much looking forward to having
direct access to my clients' electronic folders. A small group
of representatives is involved in an SSA pilot that gives them
direct access to their clients' electronic folders, allowing
them to download the contents through the ERE website. SSA has
been working on security and authentication issues and has a
plan to gradually rollout this initiative. I believe that it
will make the hearing process more efficient for all parties
involved--claimants, their representatives, and SSA.
3. Use of video hearings. Video hearings allow ALJs to conduct
hearings without being at the same geographical site as the
claimant and representative and have the potential to reduce
processing times and increase productivity. We support the use
of video teleconference hearings so long as the right to a full
and fair hearing is adequately protected; the quality of video
teleconference hearings is assured; and the claimant retains
the absolute right to have an in-person hearing as provided
under current regulations.\3\ However, we have received
complaints from representatives that, in some cases, ALJs are
discouraging claimants from exercising their right to an in-
person hearing. A new SSA pilot allows representatives to
participate in video hearings from their own private offices,
with their clients present in the representative's office. The
representative must agree to the terms established by SSA. This
pilot provides claimants with another option for their
hearings.
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\3\ 20 C.F.R. Sec. Sec. 404.936 and 416.1436.
Other Improvements at the Hearing Level
1. The Senior Attorney Program. This program allows senior staff
attorneys in hearing offices to issue fully favorable decisions in
cases that can be decided without a hearing (i.e., ``on the record'').
I have had clients approved for benefits by senior attorneys in both
the Memphis and Nashville hearing offices. This cuts off many months in
their wait for payment of benefits. I am pleased that Commissioner
Astrue decided to authorize the program for at least the next two
years.\4\ In FY 2009, senior attorneys decided more than 36,300 cases,
a 50% increase over FY 2008. This means that more than 36,000 claimants
were able to receive their disability benefits months sooner.
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\4\ The program is extended through August 10, 2011. 74 Fed. Reg.
33327 (July 13, 2009).
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2. Findings Integrated Templates (FIT). FIT is used for ALJ
decisions and integrates the ALJ's findings of fact into the body of
the decision. While the FIT does not dictate the ultimate decision, it
requires the ALJ to follow a series of templates to support the
ultimate decision. Representatives can use the FIT template, which is
available on the SSA website, to draft proposed favorable decisions.
Many representatives are now using the template either when requested
by the ALJ or on their own initiative. When the draft proposed decision
is submitted to the ALJ, it can lead to a speedier decision.
3. Increase time for hearing notice. We have previously recommended
that the time for providing advance notice of the hearing date be
increased from the current 20 days to 75 days. Based on my experience,
I strongly believe that this increase will allow more time to obtain
medical evidence before the hearing and makes it far more likely that
the record will be complete when ALJ reviews the file before the
hearing. The 75-day time period has been in effect in SSA's Region I
states since August 2006 \5\ and, based on reports from
representatives, has worked well.
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\5\ 20 C.F.R. Sec. 405.315(a).
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Improvements at the Initial Levels
CCD supports initiatives to improve the process at the initial
levels so that the correct decision can be made at the earliest point
possible and unnecessary appeals can be avoided. Improvements at the
front end of the process can have a significant beneficial impact on
preventing the backlog and delays later in the appeals process.
1. New Screening Initiatives. We support SSA's efforts to
accelerate decisions and develop new mechanisms for expedited
eligibility throughout the application and review process. We encourage
the use of ongoing screening as claimants obtain more documentation to
support their applications. However, SSA must work to ensure that there
is no negative inference when a claim is not selected by the screening
tool or allowed at that initial evaluation. There are two initiatives
that hold promise:
Quick Disability Determinations. We have supported
the Quick Disability Determination (QDD) process since it first
began in SSA Region I states in August 2006 and was expanded
nationwide by Commissioner Astrue in September 2007.\6\ The QDD
process has the potential of providing a prompt disability
decision to those claimants who are the most severely disabled.
Since its inception, the vast majority of QDD cases have been
decided favorably in less than 20 days, and sometimes in just a
few days.
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\6\ 20 C.F.R. Sec. Sec. 404.1619 and 416.1019.
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Compassionate Allowances. This initiative allows SSA
to create ``an extensive list of impairments that we [SSA] can
allow quickly with minimal objective medical evidence that is
based on clinical signs or laboratory findings or a combination
of both. . . .'' SSA has published an initial list of 50
conditions on its website, with more to be added at a later
date. Unlike the QDD screening, which occurs only when an
application is filed, screening for compassionate allowances
can occur at any level of the administrative appeals process.
SSA has held recent Compassionate Allowance outreach hearings
with expert panels to consider early onset Alzheimer's disease
and schizophrenia.
2. Improve development of evidence earlier in the process. In
previous testimony, CCD has made a number of recommendations to ensure
that disability claims are properly developed at the beginning of the
process. Claimants' representatives are often able to provide evidence
that we believe could have been obtained by the DDSs earlier in the
process. Our recommendations include:
Provide more assistance to claimants at the
application level. At the beginning of the process, SSA should
explain to the claimant what evidence is important and
necessary. SSA should also provide applicants with more help
completing the application, particularly in light of electronic
filings, so that all impairments and sources of information are
identified, including non-physician and other professional
sources.
DDSs need to obtain necessary and relevant evidence.
Representatives often are able to obtain better medical
information because they use letters and forms that ask
questions relevant to the disability determination process.
However, DDS forms usually ask for general medical information
(diagnoses, findings, etc.) without tailoring questions to the
Social Security disability standard. One way to address this
would be for SSA to encourage DDSs to send Medical Source
Statement forms to treating and examining doctors. These simple
forms translate complex, detailed medical source opinions into
practical functional terms useful to the vocational
professionals at DDSs and hearing offices.
Increase reimbursement rates for providers. To
improve provider response to requests for records, appropriate
reimbursement rates for medical records and reports need to be
established. Appropriate rates should also be paid for
consultative examinations and for medical experts.
Provide better explanations to medical providers. SSA
and DDSs should provide better explanations to all providers,
in particular to physician and non-physician treating sources,
about the disability standard and ask for evidence relevant to
the standard.
Provide more training and guidance to adjudicators.
Many reversals at the appeals levels are due to earlier
erroneous application of existing SSA policy. Additional
training should be provided on important evaluation rules such
as: weighing medical evidence, including treating source
opinions; the role of non-physician evidence; the evaluation of
mental impairments, pain, and other subjective symptoms; the
evaluation of childhood disability; and the use of the Social
Security Rulings.
Improve the quality of consultative examinations.
Steps should be taken to improve the quality of the
consultative examination (CE) process. There are far too many
reports of inappropriate referrals, short perfunctory
examinations, and examinations conducted in languages other
than the applicant's.
3. Eliminate reconsideration. To create a more streamlined process,
we have supported elimination of the reconsideration level and adding
some type of pre-decision contact with the claimant. SSA has tested the
elimination of reconsideration in ten ``prototype'' states [AL, AK,
CA--Los Angeles, CO, LA, MI, MO, NH, NY--Albany and New York City, PA]
for nearly ten years and it was recently extended through September 28,
2012.\7\ Claimants' representatives in those states report that the
process works well without a review level between the initial
determination and the ALJ level.
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\7\ 74 Fed. Reg. 48797 (Sept. 24, 2009).
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ADDITIONAL RECOMMENDATIONS
In addition to addressing the backlog and SSA's funding issues,
there are several other legislative proposals that the Subcommittee may
be considering this year.
Protecting claimants' privacy rights. We understand
that it can be cumbersome for SSA to obtain medical records, as
it is for claimants and their representatives, and that SSA is
exploring more efficient ways to secure the necessary evidence.
While we support ways to make this process more efficient, we
believe that claimants' privacy rights must be protected. We
will work with SSA to find a way to obtain, as efficiently as
possible, a claimant's authorization for release of medical
records to SSA, while protecting the individual's privacy
rights.
Extension of the fee demonstrations in the SSPA.
Access to experienced and qualified representatives through the
lengthy and complex application process is critically important
to claimants. To this end, we support allowing claimants to
enter into voluntary agreements with representatives for fee
withholding and direct payment procedures whether under Title
II or Title XVI. The Social Security Protection Act of 2004
established two demonstration projects that should be made
permanent because they have proven to be effective in
increasing claimants' access to effective representation: (1)
Extension of the Title II attorney fee withholding and direct
payment procedures to SSI claims; and (2) Allowing nonattorney
representatives to qualify for fee withholding and direct
payment, provided they meet certain requirements. Unless they
are extended or made permanent, the demonstrations will sunset
March 1, 2010.
Increase and indexing of the fee cap. Rep. John Lewis
has introduced H.R. 1093, which contains two provisions
regarding the current $5,300 fee agreement fee cap: (1)
Increase the current fee cap to $6,264.50 (which represents the
figure if it had been adjusted for inflation since the last
increase in 2002); and (2) Index the fee cap for future years
to the annual COLA. We support these changes since they ensure
that there will be a knowledgeable, experienced pool of
representatives available to represent claimants.
Work incentives. The Ticket to Work and Work
Incentives Improvement Act was enacted nearly ten years ago and
is overdue for evaluation of its effectiveness in employment of
those receiving Title II and SSI disability benefits. We urge
renewal, strengthening, and permanent extension of expired/
expiring provisions including (1) SSA's Title II demonstration
authority to test promising approaches for work incentives and
related provisions; (2) Demonstration to Maintain Independence,
set to expire this year, to provide Medicaid buy-in coverage to
working individuals whose conditions or disabilities are not
yet severe enough to qualify them for disability benefits; (3)
Protection and Advocacy for Beneficiaries of Social Security to
protect the rights of beneficiaries as they attempt to return
to work; and (4) Work Incentives Planning Assistance, which
provides state grants for outreach and education to individuals
with disabilities about supports and services regarding
employment.
CLAIMANT STORIES PROVIDED BY REPRESENTATIVES IN 2009 \8\
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\8\ Some of these claimant descriptions appeared in testimony
presented by Peggy Hathaway on behalf of the CCD Social Security Task
Force at a Joint Hearing of the House Ways and Means Subcommittees on
Social Security and Income Security and Family Support on Eliminating
the Social Security Disability Backlog, March 24, 2009. The testimony
is available at http://democrats.waysandmeans.house.gov/
hearings.asp?formmode=view&id=7618.
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CALIFORNIA
Mr. B is a 57-year-old man from Los Angeles, CA. He
worked in construction for over 30 years before he became disabled. He
has been unable to work since 2003 and is homeless. His only income is
$221 per month from General Relief. He has congestive heart failure,
torn rotator cuffs in both shoulders, severe arthritis in his knees,
severe depression, and possible cerebral atrophy. He applied for
benefits in October 2007. After his claim was denied, Mr. B obtained
representation and he filed a request for a hearing in April 2008. He
has been homeless the entire time while he waited for a hearing. During
the wait, his depression and physical health have worsened. Mr. B's
condition requires him to rest during the day and keep his feet
elevated, however he was unable to comply because shelters do not allow
residents to remain during the day. Not having a place to rest caused
his feet and legs to swell, resulting in a great deal of pain and
discomfort. He also was hospitalized after coming down with an
infection in one of the shelters.
Mr. B's hearing finally took place in July 2009, more than 14
months after requested. The ALJ issued a favorable decision on November
2, 2009, more than two years after Mr. B applied for benefits. Once he
begins to receive benefits, in another 3 or 4 weeks, he will finally be
able to find a permanent home and start working on improving his
health.
FLORIDA
Mr. M is a 57-year-old man who worked as a Vocational
Rehabilitation Specialist for over 20 years in Florida. He developed
severe arthritis throughout his body, wears bilateral hand splints,
knee splints, has developed severe joint degeneration, spinal cord
degeneration, is agoraphobic, depressed, and anxious. He cannot take
care of himself and he has no family to help him. He is about to lose
his home. Mr. M has exhausted his savings and his attorney writes
monthly letters to his mortgage company asking for extensions on his
payments while he is waiting for his hearing. Nevertheless, the company
is about to foreclose on his home.
NEW YORK
A 46-year-old man from Queens, NY, diagnosed with severe
asthma, cardiac disease, and severe depression, requested a hearing in
August 2008. He last worked as a truck driver and warehouseman. He died
from cancer in September 2009. Based on information received by his
attorney, his hearing will not be scheduled any time soon.
NORTH DAKOTA
Mr. N worked as an assistant manager of an automotive/
tire shop in Fargo, ND. He was injured while on the job in June 2006.
He did not apply for Social Security disability benefits until August
2007. He has severe, chronic myofacial pain and dysfunction syndrome,
joint dysfunction, and lumbar and thoracic musculoligamentous sprain/
strain. He also has severe major depressive disorder and panic disorder
related to his injury, which has resulted in hospitalization. Mr. N
requested a hearing on March 21, 2008. He was finally found disabled by
a decision of an ALJ (without a hearing) on February 19, 2009. Correct
payment of his Social Security benefits was delayed due to an erroneous
calculation of benefits based on his North Dakota workers compensation
claim. Benefits for his wife and dependent children also were
miscalculated. He received only a small portion of his regular monthly
benefit (less than $100 per month) and had to wait over seven months
before he received his past due benefits and began receiving the
correct monthly benefit amount. He was not receiving any wage loss
benefits from workers compensation during this timeframe.
OHIO
Mr. N is a 55-year-old former maintenance supervisor who
lives in Chillicothe, OH. He has small vessel ischemia, cerebrovascular
disease, lumbar scoliosis, degenerative joint disease, vision loss,
migraine headaches, depression, anxiety, fatigue, memory loss, and
partial paralysis to his left side caused from two strokes. Mr. N filed
his request for hearing in September 2007. While waiting for a hearing,
he has had five liens put on his home, and does not have medical
insurance to receive the medical treatment that he needs. His primary
care physician has discussed his treatment options and has explained
that his health will continue to decline, and that it is crucial for
him to receive treatment as soon as possible.
Mr. W, a 37-year-old fork lift driver from Columbus, OH,
has a head injury and bipolar disorder, which prevent him from working.
He filed his application for disability benefits in November 2006.
While waiting for a hearing, he and his family were evicted from their
apartment and his wife left him. He is living in a house with a friend
and is unable to pay rent. However, when he is awarded benefits, he
will owe back payment for the rent and continues to fall further into
debt.
Mr. P, a 60-year-old data entry person who lived in
Columbus, OH, had back and knee problems, epilepsy, and a number of
infections that kept occurring throughout his body. He filed his
application for disability benefits on April 25, 2006. While waiting
for a hearing, Mr. P became increasingly ill due to infection and
chronic lymphedema. He died on December 11, 2007. An on-the-record
favorable decision was made on October 9, 2008, ten months after his
death. Mr. P was found disabled as of May 1, 2002 (four years before he
applied for benefits) through the date of his death.
PENNSYLVANIA
An attorney in Fort Washington, PA, reports that many
clients have difficulties applying for Title II or SSI disability
benefits because they do not have health insurance or the means to pay
for medical treatment. They cannot treat their impairments, so their
conditions get worse, and they cannot prove the existence of
disability. If they apply and are denied, there is a two-year wait for
a hearing to be scheduled. For SSI applicants awarded benefits, past
due benefits are paid in installments, even if they are threatened with
eviction or foreclosure or are unable to pay for their medical
treatment. One client, a former fast food worker, received an ``on the
record'' decision in November 2008, but received half of her back
benefit despite facing a foreclosure and has not yet received the other
half of her benefits. She cannot pay for her medication or co-pays. Her
attorney suggested she go to the SSA field office, but she is too sick
and disabled to travel there and her cognitive impairment prevents her
from effectively communicating.
Mr. D lives in Dalmatia, PA. He is a veteran of the
Vietnam War and is a victim of Agent Orange and has other war-related
health and mental problems. He had obtained a favorable decision on his
Social Security disability claim. However, because of a mix-up at SSA,
it was nearly two years until his attorney was able to straighten out
his payments. He has a son with the same name and the SSA system had
the two individuals mixed in with each other. While waiting for his
payments, Mr. D's house went up for a Sheriff's sale after foreclosure.
Two days before the sale, he called his attorney, crying, and said that
he had no more reason to live. Out of sheer desperation, they called
Rep. John Kanjorski's office, which was able to help get the Sheriff's
sale postponed. Further, within two weeks, someone at SSA was trying to
straighten out the mix-up. Within two months, the payments started. Mr.
D's attorney notes that he does not believe this would have been
accomplished if Rep. Kanjorski's office had not intervened.
Ms. L is 50 years old and lives in Pennsylvania. She has
been diagnosed with cirrhosis of the liver caused by Hepatitis C.
Although she has finally received a hearing date, the wait has been a
struggle for her. She has had her utilities shut off, her car
repossessed, and her health has worsened. Ms. L's medical care is very
costly. She has been non-responsive to certain treatments for her
cirrhosis and is now on the liver transplant list.
TENNESSEE
Mrs. C, a 43-year-old radiology/CT scan tech, lives in
Clarksville, TN. She is unable to work due to diabetes, depression,
anxiety disorder, fluid and arthritis in her knees, spondylothesis,
spinal stenosis, degenerative disc disease, broad based disc bulges and
severe pain and weakness in both legs. She filed her application for
disability benefits in June 2007. While waiting for her hearing, Mrs. X
and her family have been evicted from their home. Both of their
vehicles have been repossessed, and they are having extreme
difficulties paying for their day to day living. Her husband is on the
verge of being laid off and, if that happens, there will be no income
at all for this family. Due to the backlog, this claimant and her
family may lose everything before she is able to get a hearing date and
decision.
Ms. A is 61 years old and lives in Milan, TN. She has
Major Depressive Disorder, which prevents her from working. She filed
her application for benefits in 2007. Ms. A's hearing has not yet been
scheduled but her attorney has requested an on-the-record decision. She
and her husband, who is currently employed, were forced to file for
Chapter 7 bankruptcy in order to keep their house. The majority of her
husband's check is going to the bankruptcy trustee each pay period,
leaving them with only $4 to $27 per pay period for all of their other
expenses, such as groceries and utilities
Mr. D, a 48-year-old man who lives in Gibson County, TN,
has musculoskeletal impairments. He filed his application for
disability benefits in 2007. Mr. D's hearing has not yet been
scheduled. He has lost his home and his wife left him. He is
essentially homeless, living with various family members and friends.
Mr. W is 53 years old and currently lives in Haywood
County, TN. He has been diagnosed with musculoskeletal impairments. He
filed his application for disability benefits in late 2004. It was
denied and he had to appeal the case to federal district court. The
court remanded the case, but not until mid to late 2008. After a remand
hearing in 2009, his claim was allowed. However, while waiting for the
decision, he lost his home and has had to live with various family
members.
TEXAS
Ms. A is a resident of Austin, TX, who filed a claim for
disability benefits on April 27, 2006, after undergoing a quadruple
coronary bypass. Ms. A's claim was denied initially and on
reconsideration, and she requested a hearing on April 3, 2007, which
was held on February 4, 2008. While awaiting the hearing, Ms. A
experienced extreme financial hardship resulting in the foreclosure of
her home and increased depression and anxiety. Unfortunately, her claim
was denied by the ALJ in a April 2, 2008, decision. She appealed to the
Appeals Council, which resulted in a remand order, dated August 27,
2008, for another hearing. As of this date, the remand hearing has not
been scheduled, 15 months after the Appeals Council remanded the case.
While waiting for her new hearing, Ms. A has continued to experience
extreme financial hardship and, on several occasions, homelessness was
a very real possibility.
Mr. A is 45 years old and lives with his wife in Mission,
TX. He has degenerative disc disease of the lumbar spine status post
lumbar laminectomy, major depressive disorder, and borderline
intellectual functioning, which prevent him from working. He filed his
application in September 2003. The claim was denied initially in
November 2003 and at reconsideration in February 2004 and he requested
a hearing a few days later. While waiting for a hearing, Mr. A's house
burned down in November 2004. His hearing was finally held in June
2006, more than two years after he filed his appeal. The hearing was
continued in order to obtain a psychological consultative examination
and a supplemental hearing was held in July 2007. The ALJ denied the
claim and on appeal, the Appeals Council remanded the case back to the
ALJ. During this period, Mr. A was forced to file for bankruptcy. He
had a remand hearing in February 2009 before the same ALJ who
previously denied his case. At the remand hearing, the ALJ announced he
would be awarding a fully favorable decision.
Mr. R is 48 years old and lives in San Antonio, TX. He
has back pain, joint pain, hearing problems, Hepatitis C, and a head
injury, which prevent him from working. He filed his application for
benefits in January 2007. While waiting for a hearing, he became
homeless and cannot receive proper medical attention. Mr. R has to rely
on the kindness of friends for his basic necessities.
WISCONSIN
A middle-aged Eau Claire area woman became disabled, when
her knees deteriorated to the point where she needed knee replacements.
Her knee conditions led to back problems, causing chronic pain for
which she has to take highly potent narcotic drugs. After waiting
nearly three years for her hearing, the ALJ allowed her case after ten
minutes. While waiting for her hearing, her family lost their home to
foreclosure and she had to file for bankruptcy. After the hearing, her
attorney asked if they would have lost their home or had to file for
bankruptcy if she had been getting her Social Security disability
benefits sooner. Tearfully, she replied, absolutely not. To add insult
to injury, her attorney just received a telephone message from her in
early November 2009. Even though this client's fully favorable decision
was dated August 31, 2009, she has still not received either her first
check or her past due benefits. She called the Social Security District
Office and was told it could take 90 days for the Payment Center to get
her into pay status and to issue her payment for past due benefits.
In early November 2009, a man from Humbird, WI, received
his fully favorable decision, almost three years after filing his
Social Security disability application. Unfortunately, he was served
one day later with a Summons and Complaint to foreclose his home. (His
monthly mortgage payment had been increased from $327 per month to over
$900 per month, because the mortgage lender had to pay his property
taxes last year.) He is now hoping to negotiate a redemption, but it is
unclear whether the mortgage holder will do so. If not, he will have to
file for bankruptcy. His attorney is hoping that the SSA Payment Center
will not delay payment of his case, so he will have his past due
benefits to use in his attempts to work something out with the mortgage
holder.
Also in early November 2009, the husband of a claimant
from Chippewa Falls, WI, came to the wife's attorney's office to ask if
there is anything the attorney could do to expedite payment of the
wife's benefits. His wife had filed her application in July 2006.
Nearly three years later, she received a fully favorable hearing
decision, dated June 19, 2009. Five months after the ALJ found her
disabled, she still has not received either a monthly benefit payment
or her past due benefits. The client and the attorney's staff have
placed calls to the SSA field office. They have been told that the
delay is caused by the Payment Center and that all the field office can
do is try to prod the payment center to pay the benefits.
While waiting for his hearing, Mr. L became homeless. He
lived in the La Crosse, WI, area and was waiting for a traveling ALJ to
schedule his hearing in La Crosse. Over a one and a half year wait, Mr.
L's attorney tried to expedite the hearing since he was homeless and
winter was approaching. In January 2009, his attorney sent the ALJ
another letter indicating that Mr. L was living in a shanty in the
woods, hunting rabbit for food, and using a campfire to keep warm.
Eventually, his hearing was scheduled for April 2009, but the ALJ
approved the case without the need for a hearing. By that time, Mr. L
had moved to another state to stay with someone.
* * * *
CONCLUSION
As you can see from the circumstances of these claimants' lives and
deaths, delays in decision-making on eligibility for disability
programs can have devastating effects on people already struggling with
difficult situations. On behalf of people with disabilities, it is
critical that SSA be given substantial and adequate funding to make
disability decisions in a timely manner and to carry out its other
mandated workloads. We appreciate your continued oversight of the
administration of the Social Security programs and the manner in which
those programs meet the needs of people with disabilities.
Thank you for the opportunity to testify today. I would be happy to
answer questions.
ON BEHALF OF:
American Association on Intellectual and Developmental Disabilities
American Council of the Blind
American Network of Community Options and Resources
Association of University Centers on Disabilities
Bazelon Center for Mental Health Law
Community Access National Network (TIICANN)
Epilepsy Foundation
National Alliance on Mental Illness
National Association of Disability Representatives
National Disability Rights Network
National Health Care for the Homeless Council
National Organization of Social Security Claimants' Representatives
National Spinal Cord Injury Association
Paralyzed Veterans of America
Research Institute for Independent Living
The Arc of the United States
United Cerebral Palsy
United Spinal Association
World Institute on Disability
Chairman TANNER. Thank you very much, Ms. Bates. Of course
I should mention we will accept all your statements for the
record in their entirety.
Mr. Inspector General, welcome. You are recognized, sir.
STATEMENT OF PATRICK P. O'CARROLL, JR., INSPECTOR GENERAL,
SOCIAL SECURITY ADMINISTRATION
Mr. O'CARROLL. Good afternoon, Mr. Chairman and Mr.
Johnson. Thank you for calling this hearing, and giving me the
opportunity to testify about SSA's efforts to reduce the
backlog of initial disability claims. This has been a
challenging time for the American economy and the American
people. At such times, people turn to the safety net of Social
Security in record numbers.
In fiscal year 2009, SSA received almost 3 million
applications for disability benefits, which was an increase of
some 15 percent over the previous year. The State Disability
Determination Services, or DDSs, were able to process eight
percent more claims than the year before. However, this still
created a net deficit, leaving the backlog at its current level
of three-quarters of a million claims.
One significant threat to SSA's efforts to decrease this
backlog has been the furloughing of DDS employees by states
struggling with budget issues. Federal regulations discourage,
but do not prohibit, this practice. To date, nine states are
furloughing all of their DDS employees, and three states are
furloughing some of their DDS employees. In states furloughing
all DDS employees, this has created a 14 percent shortfall of
capacity for processing applications.
In our report, ``Impact of State Budget Issues on SSA's
Disability Programs,'' issued earlier this week, we estimate
that the furloughs will cause delays in 69,000 claims, and
delays in issuance of $126 million in benefits to those in
need.
Also troublesome from an integrity perspective is the
resulting increase in the backlog of medical continuing
disability reviews, or CDRs. These reviews result in program
savings of $10 for every dollar that's invested. Resources that
could be used for CDRs are being reallocated to processing
initial claims, and program dollars are lost.
Significant efforts have been made to limit the impact of
the furloughs. The Commissioner contacted all the state
governors and many state legislators. Vice President Biden
wrote to the National Governors' Association. There was even
litigation in California that sought to preclude the furloughs.
As a result of these and other efforts, two states exempted
their DDSs from the furloughs, and three states partially
exempted their DDS employees, saving another 11,000 claims and
$24.4 million from being delayed. SSA has hired 192 new staff
for Federal units that process initial claims. The Agency
transferred cases facing delays from states to those Federal
units to ensure timelier processing.
SSA should be commended for its efforts to minimize the
impact of state furloughs and other hiring and staffing issues.
Still, these state actions have clearly resulted in delays and
increased the backlog.
SSA staffing is another issue critical to the reduction of
this backlog. Congress was aware of the increased workload that
the economic downturn would engender when it passed the
American Recovery and Reinvestment Act. The act provides $500
million to SSA to process retirement, disability, and survivors
insurance workloads, and SSA has put that money to good use.
Of the $500 million, SSA invested $251 million in its
office of operations, which has now hired 1,531 additional
staff. We reviewed SSA's plan for these funds, and found that
the plan and the placement of the new hires was appropriate.
Most of the other $249 million was invested in hiring 300
additional staff in the DDSs, and 35 ALJs and 556 support staff
in the Office of Disability Adjudication and Review. We are now
conducting similar reviews of SSA's use of these funds.
Finally, I would be remiss if I didn't use this opportunity
to encourage continued vigilance, with respect to program
integrity. In attending to the backlog of initial claims, it is
critical that SSA and the DDSs continue to conduct CDRs and
refer suspicious claims to the OIG's cooperative disability
investigative units and field divisions.
The efforts that Congress, SSA, and the OIG have put
forward are important elements in ensuring that the backlog of
initial claims is ultimately reduced to an acceptable level. I
pledge the OIG's continued support in this effort, and I thank
you for the invitation to be here today. I will be happy to
answer any questions.
[The prepared statement of Mr. O'Carroll follows:]
Prepared Statement of The Honorable Patrick O'Carroll, Inspector
General, Social Security Administration
Good morning, Mr. Chairman, Mr. Johnson, and Members of the
Subcommittee. As always, it's a pleasure to appear before you, and I
thank you for the invitation to be here today. I've appeared before you
several times to discuss the backlog of disability appeals, and the
Social Security Administration's (SSA) efforts to reduce that backlog
to ensure that appellants eligible for benefits receive them in as
timely a fashion as possible. Today, we are looking at SSA's backlog in
initial disability claims, a backlog of over three-quarters of a
million people currently waiting for sorely needed benefits.
The past two years have been challenging ones for the American
people, as the economy struggled. In times such as these, people turn
in ever-increasing numbers to the world's largest social insurance
program. In Fiscal Year (FY) 2009 alone, SSA received almost 3 million
initial disability claims, an increase of 15 percent over FY 2008.
These numbers challenge SSA's ability to provide world-class service
delivery, creating workloads that exceed resources and causing delays
and backlogs. These numbers also create challenges for both SSA and the
Office of the Inspector General (OIG) with respect to stewardship, as
we strive to ensure that only those eligible for benefits are granted
them.
To make the challenges even more daunting, the financial strain on
the states caused by the faltering economy have resulted in furloughs
that further slow the application process; and the increase in
applications has forced the dedication of resources to processing
applications, rather than conducting medical continuing disability
reviews (CDR) or work CDRs, or taking other steps to ensure integrity.
It is critical that Congress and the American people have reason to
be confident that Social Security benefits will be provided to those
who need them, and equally confident that their tax dollars are being
spent well and wisely. The OIG is at work on both sides of this
equation, helping SSA to maintain its high level of service through
timely audits and recommendations, while also acting as a watchdog, to
ensure that benefits are paid properly, and that appropriated resources
are used as intended.
Congress was certainly well aware of the challenges SSA would face
in the current economy when it provided SSA with $500 million under the
American Recovery and Reinvestment Act (ARRA) to process disability and
retirement workloads, as well as $500 million to replace the National
Computer Center and $90 million to process one-time economic recovery
payments of $250 to beneficiaries. The OIG received $2 million to
ensure that these funds were used properly, and I'd like to share some
of our work in that area today.
The funds provided to SSA to process initial claims were critical.
As I mentioned, the current disability backlog stands at over three-
quarters of a million applications--some 38 percent higher than a year
ago. This resulted from a 15 percent increase in claims filed, against
only an 8 percent increase in claims actually processed by the State
Disability Determination Services (DDS). These delays are caused not
only by the increase in applications, however, but also by State
furloughs, staffing problems, and other issues.
The furloughs are particularly troublesome. Federal regulations
discourage furloughs of DDS personnel, but this has not stopped
furloughs from occurring. To date, nine states are furloughing all
their DDS employees and three states are furloughing some DDS
employees.
In states that are furloughing all of their DDS employees, this has
created a 14 percent shortfall of capacity for processing claims. In
our report, Impact of State Budget Issues on SSA's Disability Programs,
issued earlier this week, we estimate that the furloughs have caused
delays in 69,000 claims, and delays in the issuance of $126 million in
benefits to those in need. In addition to the furloughs themselves,
other issues are contributing to this impact. Certain states have
encountered high attrition rates among DDS employees, others have
encountered pay freezes, and still others have hiring practices that
are problematic.
The Commissioner has made significant efforts to limit the impact
of furloughs, and was able to make some progress. He contacted all of
the State Governors and many State legislators. Vice President Biden
wrote to the National Governors' Association, and there was even
litigation in California that sought to preclude furloughs.
As a result of these and other efforts, two States exempted their
DDSs from State employee furloughs, and three States partially exempted
DDS employees, saving another 11,000 cases and $24.4 million from being
delayed. Several more States fully or partially exempted DDSs from
hiring restrictions. Additionally, SSA hired 192 new staff for Federal
units that process initial claims, and transferred cases facing delays
from States to those Federal units to ensure timelier processing.
While SSA should be commended for its efforts to minimize the
impact of State furloughs and other hiring and staffing issues, it is
indisputable that these State actions have resulted in delays and kept
benefits out of the hands of those in need.
Staffing at SSA is another critical factor in timely processing of
applications, and the ARRA funds provided for that purpose have been
put to use. Of the $500 million allocated to this purpose, SSA
allocated $251 million to its Office of Operations, which is using the
funds to process disability and retirement workloads. Operations hired
1,531 new employees, and authorized the use of overtime pay to keep
pace with applications.
The Office of Management and Budget issued guidance on spending and
accounting for ARRA funds, and this guidance included the publication
of detailed plans for use of the funds. The OIG just issued a report
evaluating SSA's plan for the $251 million allocated to the Office of
Operations. Overall, we found that the plan was appropriate, and the
placement of new hires was based on appropriate factors.
The remaining $249 million was primarily directed to the DDSs,
which hired 300 additional employees, and the Office of Disability
Adjudication and Review, which hired 591 employees, of which 35 were
Administrative Law Judges and 556 were new support staff. The OIG is
conducting audits of the plans for the DDS' and ODAR's use of ARRA
funds, similar to the audit conducted of the Operations plan.
SSA's efforts to minimize the impact of State budget shortfalls,
and its initial efforts with ARRA funds, have been important steps in
ensuring that initial applications encounter as few delays as possible,
but more needs to be done. While additional resources would be of
significant immediate benefit, there are long-term issues that can be
addressed to prevent future backlogs.
For example, SSA received $500 million in ARRA funds to replace the
National Computer Center (NCC), SSA's aging repository for the data and
electronic processes that enable SSA to pay benefits to 50 million
Americans. Replacement of the NCC is critical to the future of the
Social Security system.
The OIG is monitoring SSA's progress. At present, we continue to
await specifications for the project, which we intend to subject to
rigorous review. Our reports will ultimately be published on our
website, as well as Recovery.gov, and we will remain involved in the
process until a new data center is complete and operational.
Infrastructure and hardware, however, are only part of the
equation, as SSA's primary data applications require modernization.
SSA's attempts to upgrade its software to improve service delivery and
stewardship are ongoing, but need to be given a higher priority. It is
important that SSA consider all software options carefully and ensure
that it is taking the best approach. As we point out in our Financial
Statement Audit, consideration must be given to the benefits gained
from the administrative funds transferred to SSA's IT budget each year.
In addition, the OIG strongly supports giving SSA's Chief Information
Officer sufficient delegated authority and resources to fulfill
required security responsibilities.
Since I have mentioned two of the three ARRA mandates given to SSA,
let me briefly state that the OIG also reviewed SSA's use of the $90
million provided to process one-time $250 stimulus payments. We found
that SSA implemented a comprehensive process to identify and report
these costs, and met OMB's requirements for transparency and
accountability. The process was not without its challenges, however,
including the issuance of checks to some ineligible prisoners and
deceased beneficiaries. While perfection is an unreasonable
expectation, improvements can be made legislatively and procedurally to
tighten the process for future stimulus payments.
The primary focus of this hearing, however, is the disability
application backlog, and in addition to the efforts I described
earlier, SSA has made other inroads toward streamlining the initial
disability determination process, reducing the backlog and, more
importantly, getting benefits into the hands of those who qualify, and
need them, as quickly as possible:
Compassionate Allowances provide expedited approval
to disability applicants with confirmed diagnoses of certain
severe impairments. These Allowances let SSA quickly target the
most obviously disabled individuals for benefits based on
objective medical information that SSA can obtain quickly.
Quick Disability Determinations (QDD) are cases that
are electronically identified as having a high potential that
the claimant is disabled, when evidence of the claimant's
allegations can be easily and quickly obtained, and when the
case can be processed quickly in the DDS. These cases are
prioritized for fast turnaround. We estimate that the
Compassionate Allowances and QDD initiatives will account for
approximately 3.7 percent of initial disability claims.
Additional Administrative Law Judges and hearing
office support staff have been hired by SSA, and the
recommendations from our draft report, Hearing Office
Performance and Staffing, are being considered in ensuring that
staffing ratios in SSA hearing offices are optimized to make
the most of the new ALJ corps.
SSA is developing a multi-year plan to reduce the
initial claim backlog. According to SSA, the key components of
this plan are:
increased adjudicatory capacity in the DDSs
and Federal processing components;
improved efficiency through automation;
expedited IT investments to optimize systems
performance;
expanded use of screening tools to assist in
identifying likely allowances; and
refined policies and business processes to
expedite case processing.
The OIG will review the Agency's plan when it is available, and
will monitor its progress closely.
SSA has instituted a Senior Attorney Adjudicator
Initiative, which allows attorney adjudicators to issue fully-
favorable on-the-record decisions. The goal is to expedite
decisions while preserving ALJ resources for the more complex
cases that require a hearing.
SSA has also instituted an Informal Remand
Initiative, in which a hearing office can return a denied claim
to the DDS for review of the previous determination when there
is a strong likelihood that the denial will be reversed, again
saving hearing resources for more complex cases.
Finally, I would be remiss if I did not point out that integrity
continues to be a primary focus of the OIG. Our continuing support for
increasing the number of CDRs has never wavered. As important as it is
to ensure that applicants are eligible for benefits at the time of
their initial application, it is equally important to ensure that they
remain eligible as time goes by. However, SSA is expecting to have a
backlog of 1.5 million medical CDRs by the end of FY 2010. SSA had
eliminated the CDR backlog when Congress provided the Agency dedicated
funding that could only be used for CDRs. After that funding ran out in
FY 2002, the backlog grew again. When SSA performs a full medical CDR,
it costs about $1,000, but provides an estimated return on that
investment of $10 to $1.
Similarly, the Cooperative Disability Investigative program, or
CDI, is an important ingredient in the integrity formula. The CDI
Program began in Fiscal Year 1998 as a joint effort by the SSA and the
OIG, in conjunction with the DDS and State or local law enforcement
agencies, to effectively pool resources for the purpose of preventing
fraud in SSA's Title II and Title XVI disability programs and related
Federal and State programs. In 1998, the CDI Units became operational
in 5 states. The program currently consists of 20 units located in 18
states, with 2 additional units to become operational in FY 2010. Since
its inception, the CDI program has closed 26,448 cases, and generated
about $1.35 billion in SSA program savings and another $829 million in
non-SSA savings.
As more individuals apply for benefits, allegations to these 22 CDI
units across the country will increase. These units play a key role in
ensuring that, while reducing the backlog of disability claims, SSA and
the DDSs have an avenue available to them to further explore claims
that may be suspicious or lack sufficient information to make a
determination. Thus, the CDI program helps maintain the level of
accuracy and integrity in these programs that the American public
deserves.
In summation, the OIG is dedicated to working with Congress and SSA
to reduce the backlog of disability claims, and to ensuring that this
takes place in an environment in which efficiency, integrity, and
transparency are paramount. SSA's efforts to date are commendable, and
we look forward to continuing to assist in this critical undertaking. I
thank you again for the invitation to speak with you today, and I'd be
happy to answer any questions.
Chairman TANNER. Thank you very much, Mr. Inspector
General.
Ms. Robert, we are delighted you are here, and glad to hear
from you in your capacity on the Disability Determination
Services. So, welcome. Thank you for being here.
STATEMENT OF ANN P. ROBERT, VICE PRESIDENT, NATIONAL COUNCIL OF
DISABILITY DETERMINATION DIRECTORS, SPRINGFIELD, ILLINOIS
Ms. ROBERT. Thank you very much, Mr. Chairman, Mr. Johnson.
My name is Ann Robert, and I am honored to be here on behalf of
the National Council of Disability Determination Directors. The
NCDDD is comprised of managers and directors of the State DDSs.
As you have heard today, the state DDSs process all kinds
of claims, including initial applications, reconsiderations,
and continuing disability reviews. You have also heard today
about the increases in the initial applications. While there
have been increases in recent years in funding for SSA--and the
NCDDD thanks Congress for the resources that the DDSs have
received to assist in giving the good public service that they
have--those resource needs are certainly going to continue, in
light of the increased applications.
What's complicating the Disability Determination Services'
ability to handle those increasing workloads are some of the
other things that you've heard about today. For example, the
furloughs. Despite the Commissioner's efforts to exempt all DDS
employees from those furloughs, all of his attempts have not
been successful.
What a furlough costs is not just problems in processing
time, or problems in working claims, but it also costs dollars
from the State. You heard that today. For example, a one-day
furlough in the State of Ohio costs the state $345,000 in
administrative funding, $149,900 in delayed monthly benefits to
claimants, and impacts 731 claims. So you can see that the
impact of even one day of furlough is significant.
While SSA has authorized hiring in the DDSs, the hiring has
not always been optimized, because some other states have
freezes and delays in hiring. Other states have been able to
hire.
But with hiring, you don't get immediate results for
increased capacity or productivity. The Social Security
disability program is complex, and requires significant
training to bring an examiner to the point where they're
independent and productive. The initial learning curve, coupled
with the problems with attrition that the DDSs currently
encounter are impacting the DDSs' ability to process this
workload.
Now, it's been interesting, as the DDSs move forward, they
have always--even with limited resources--processed cases,
stepped up to the plate, provided good public service. The days
of increased applications currently--and as we move in the
future--provide significant challenges to the DDSs, which
certainly will require some additional funding.
The Social Security Administration has requested, and
Congress has provided, additional funding for technology.
Technology forms a very important basis for improving claim
processing, and it is critical that that funding continue to
provide the capacity and the capability to provide good public
service through an efficient and quality case-processing
system.
You've heard from the Commissioner today about a couple of
the initiatives: the DCPS, or the common case processing
system; the QDD and CAL initiatives, and also eCAT. Those
initiatives are important. They combine both technology and
policy. NCDDD supports the continuation of those initiatives,
and will work with SSA for the further development and roll-out
of all of those initiatives in the DDSs.
Social Security is working right now on a----
Chairman TANNER. If you did all that from memory, you're
pretty impressive.
[Laughter.]
Ms. ROBERT. It's what we lawyers do, isn't it?
Social Security is working right now, as you heard from the
Commissioner, on workload planning issues. You have also heard
from him how they are creating some ESTs, or extended service
teams, which will provide national resources to some of the
DDSs needing assistance. It's very critical that the DDS
community be involved in every part of this process.
State DDSs are used to doing workload sharing, and helping
out with additional workloads. In fact, we helped with the ODAR
reduction by taking some informal remand cases. But
transferring cases from state to state can be both politically
sensitive and technologically challenging. So, this move must
move forward with much caution and much collaboration by the
DDSs.
NCDDD will continue to work with the SSA in development of
an operational plan that is cost efficient, that is cost
effective, ensuring success to address the workload while
providing good, quality service, and program stewardship.
We want to thank Commissioner Astrue for his collaboration
and support of the DDS community. We want to thank this
committee for their support of the funding for the Social
Security Administration that assists the DDSs, and we also look
forward to enhancing the partnership of the Federal-State
relationship.
So, in closing, the need for additional resources comes in
a variety of ways. Certainly we need funding for staffing. We
also need additional funding to continue with the initiatives,
and funding for the robust infrastructure that needs to support
this case processing system that can handle all these claims.
So, thank you, Mr. Chairman, for inviting me to come here
today, and for all your work in this regard.
[The prepared statement of Ms. Robert follows:]
Prepared Statement of Ann P. Robert, Vice President, National Council
of Disability Determination Directors, Springfield, Illinois
Chairman Tanner, Mr. Johnson, Members of the Subcommittee, my name
is Ann Robert and I am honored to have this opportunity to appear on
behalf of the National Council of Disability Determination Directors
(NCDDD) to comment on the effect of SSA's unprecedented backlog of
disability claims, the agency's efforts to address those challenges,
the impact of the recession on disability claims processing, and the
ongoing need for adequate resources to address these issues.
The National Council of Disability Determination Directors (NCDDD)
is a professional association composed of the Directors and managers of
the Disability Determination Services (DDS) agencies located in each
state, the District of Columbia, Puerto Rico, and the Virgin Islands.
Collectively, members of the NCDDD are responsible for directing the
activities of approximately 15,000 employees who process nearly 4
million claims per year for disability benefits under the Social
Security Act. NCDDD goals focus on establishing, maintaining and
improving fair, accurate, timely and cost-efficient decisions to
persons applying for disability benefits. The mission of NCDDD is to
provide the highest possible level of service to persons with
disabilities, to promote the interests of the state operated DDSs and
to represent DDS directors, their management teams and staff.
The DDSs are entirely federally funded by SSA and make medical
determinations for the Social Security disability programs. The DDSs
adjudicate various claim types including initial applications,
reconsiderations, and continuing disability reviews. Many SSA
executives have referred to the DDSs as the ``best bang for the buck''
in promoting governmental efficiency and effectiveness. NCDDD believes
the Federal-State relationship is an important piece of the solution to
addressing the increasing backlog of disability claims.
NCDDD appreciates the increases in SSA funding over the past few
years and sincerely thanks Congress for the resources to assist the
DDSs in providing the needed and necessary service to those Americans
reaching out for help in desperate and difficult times. The recent
funding increase has resulted in a decrease in the backlog and
processing time at the hearings level. The DDSs received additional
funding for overtime which they utilized for the Informal Remand
process to assist ODAR with the backlog reduction.
The DDSs have seen a significant increase in the filing of initial
disability claims which started in early FY 2009 as Baby Boomers
predictably began to leave the workforce in their disability prone
years and the nation began to experience the consequences of the
economic downturn. As workers unexpectedly lost their jobs, they sought
any other source of income, including Social Security disability
benefits. Between the end of FY 2008 and the end of FY 2009, the number
of initial claims has increased 14.8%. The total number of initial
pending claims is expected to exceed one million by the end of FY 2010.
The full or partial furlough of DDS staff in several states has
added additional hardship to processing the disability workload. These
furloughs have continued despite the support of the Administration and
the committed leadership and support of Commissioner Astrue to exempt
these federally funded DDS employees from the furloughs. Currently
there are thirteen (13) states with full or partial furloughs. These
furloughs compromise efforts by DDS staff to allow claims, including
extreme hardship claims, and the ability of the DDS to provide the
necessary public service. A one (1) day furlough can cost a state like
Ohio $345,000 in administrative funding and $149,900 in delayed monthly
benefits while impacting 731 claims. In other cases, DDSs have not been
able to optimize all the hiring authorized by SSA due to a state-
imposed hiring freeze or state hiring delays.
SSA has requested significant funds to process the disability
workloads and Congress has generously provided these funds. While the
DDSs have worked to hire to optimal levels, the increasing complexity
of the disability program criteria requires approximately 12-18 months
of experience in the program for a disability examiner to become fully
independent and productive. Therefore, hiring does not immediately
translate to increased capacity and productivity. This initial learning
curve, coupled with the current attrition in the DDSs (12.3% annually)
is a significant challenge for the state DDSs in maintaining a
qualified and experienced workforce. Historically, despite limited
resources, the DDSs have worked to provide the much needed public
service. However, the rising number of applications and the limited
ability to hire and retain qualified and trained staff will have
significant negative impact for the DDSs and the public we serve.
SSA has, for the past few years, looked for ways to utilize
technology to provide greater capacity and more efficient claim
processing. The move to electronic claim processing was a significant
task and one that came with some difficulty but much benefit to the
disability claimant and to those components adjudicating disability
claims. SSA has continued to request funds for technology and those
funds have been and continue to be critical to ensuring the necessary
capacity and capability to provide not only efficient but also high
quality service to which the American public is entitled.
Currently SSA has various initiatives combining policy and
technology which have the potential to improve claim processing on
several levels. The Disability Case Processing System (DCPS) is a SSA
initiative partnering and collaborating with the States to design a
case processing system to be used by all Disability Determination
components. This case processing system should, when complete, provide
a comprehensive process to produce efficiencies. DCPS must have
sufficient infrastructure to provide a robust system that is stable,
available, and responsive. DCPS should facilitate case processing not
only in an individual DDS but when the need arises to assist with
future workload challenges between Disability Determination components.
The Quick Disability Determination/Compassionate Allowance (QDD/CAL)
initiative is a process which allows the system to prioritize cases
through technology providing for early identification of cases with a
high potential of allowance thereby delivering expeditious service to
those in desperate need. Another important but separate initiative of
SSA is the Electronic Case Analysis Tool (eCAT). This tool can assist
an examiner in working through a complex claim to reach the correct
decision at the earliest point in the process. NCDDD supports each of
these initiatives and will continue to work with SSA to further
develop, refine, and roll out these processes.
SSA has begun planning for the potential to achieve greater
capacity to address additional claims. The strategies are, necessarily,
multifocal and involve both state and federal components. For example,
SSA has funded four DDSs to create Expanded Service Teams (EST) to
produce work as a separate entity and as a ``national resource'' with a
yet to be finalized methodology as to how states will quality for
assistance and how this process would impact productivity for any
affected component.
The DDSs have a long and successful history of working
cooperatively to assist with other workloads on an informal basis. With
this background of success, the DDS community should be actively
involved in all discussions to determine the best methodologies to
provide assistance to any state while keeping in mind our primary focus
of providing the best public service possible. Transferring work from
state to state or to other components is both politically sensitive and
frequently a technologically challenging venture that needs to be
considered cautiously. Any plan to address the workload should be
replete with appropriate mechanisms to assure accountability and
consistency in decision-making regardless of which State Agency or
federal disability component processes the claim. NCDDD will continue
to advocate for DDS involvement in this plan and for a process that is
well researched. NCDDD will assist in identifying and resolving
potential problems or obstacles to ensure an efficient and effective
process for those involved in this work flow process and those affected
by it.
SSA is facing unprecedented increases in workload and requires an
appropriate level of funding to continue to serve the American public
with timely and accurate decisions, for both new applications and
continuing disability reviews. SSA and the DDSs must receive adequate
resources to provide necessary staffing, continue important
initiatives, and provide a robust infrastructure that delivers the
system stability and availability for claim processing. NCDDD stands
ready to work cooperatively with the SSA in developing an efficient,
consistent, and cost-effective operational plan that will ensure the
success of addressing this unprecedented workload while continuing to
provide quality public service and program stewardship. We would be
remiss if we did not publicly acknowledge the outstanding and
unwavering support that Commissioner Astrue has provided to the DDS
community. His collaboration and partnership have been invaluable to
the identification of solutions and successes in the disability
process.
Mr. Chairman. On behalf of NCDDD, thank you again for the
opportunity to provide this testimony. NCDDD has a long track record of
success working with SSA to provide the highest level of service. I
hope that this information is helpful to the Subcommittee. NCDDD is
willing to provide any additional assistance you may need and I would
be happy to answer any questions you may have.
Chairman TANNER. Thank you very much, Ms. Robert. We agree
that your organization has to be a critical part of this.
Judge Auerbach? Your Honor, you are recognized.
STATEMENT OF LARRY A. AUERBACH, ADMINISTRATIVE LAW JUDGE, ON
BEHALF OF THE FEDERAL BAR ASSOCIATION, ATLANTA, GEORGIA
Judge AUERBACH. Thank you, Mr. Chairman. I am Larry
Auerbach, from the Atlanta downtown hearing office of Social
Security, and I believe I am required to give the disclaimer
that I am not speaking on behalf of Social Security or the
Federal Bar Association, but rather, the Social Security
section of the Federal Bar Association.
There has been, as there has to be, a lot of talk about
statistics and data here. That is how we gauge what the problem
is, and how we gauge our success in dealing with the problem.
But Congressman Kind and Ms. Bates each talked about
individuals who suffer because of the delay.
As a judge, it is sadly common that I see individuals who
are suffering those losses, individuals whose medical notes
indicate that surgery is needed, but can't be done until
disability is approved; individuals who are not taking their
diabetes medication or their hypertension medication, because
of a lack of funds while they are waiting on the approval of
their disability.
These people don't just suffer at that time, but their
disabilities, which might sometimes be temporary, become
permanent disabilities while they are awaiting adjudication.
That's a devastating blow to those individuals, and it's also a
blow to the American taxpayers, who will then be funding
disability payments for these individuals and health care costs
for the rest of their lives.
I have seen individuals who have lost their homes, lost
their cars while they are waiting on their determination.
Without a car, people often don't have access to medical care.
Without homes, they lose safety, stability for themselves and
their families. Sadly, we find too often that we can't even
find the individuals to notify them that their day in court has
finally come.
The human face of this is tragic. It has, as has been noted
by everyone here, improved dramatically. When I started just
three-and-a-half years ago as a judge with Social Security, the
average claimant that I saw had applied for benefits about four
years before the date of his hearing. Today, I am seeing
claimants who applied about two years before the date of the
hearing. That's still a really long time, and, tragically, too
long.
Progress has been made because of support from Congress and
support from this committee, and initiatives that Commissioner
Astrue talked about. The Social Security section applauds
those. The improved technology has been a great benefit. The
increased numbers of Administrative Law Judges and, just as
importantly, the increased number of staff, has been vital to
reducing the backlog and the wait times.
Judge Cristaudo, who was here earlier, sitting behind the
Commissioner, and his team have done a lot to implement the
Commissioner's plans, but if you look at the data, some of
which are cited in my written testimony, there is a wave of
claims being filed now with the state DDSs. The resources now
will not accommodate that wave.
What will happen is that the backlogs will increase, the
wait times will increase, and the tragic effects on human
beings will increase, unless there is decisive action. In my
written testimony there are a number of specific
recommendations. The DDSs--and I know they are well represented
here--they have been overburdened for years. With the increased
load, they will be further overburdened.
The Social Security section would support some
congressional action to prevent the furloughs at DDS--not any
particular bill; I'm not familiar with the specific bill which
has been proposed, but we would support some action to prevent
these State employees from being furloughed.
We also think there is a need for improved adjudication at
DDS to mitigate the problems and the downstream flow that comes
to the hearing offices. I believe it was Congressman Becerra
who talked about consistency. There really isn't consistency in
state DDSs. If a claimant from your home State of Tennessee or
my home State of Mississippi were to take the bridge right
across the Mississippi River to Arkansas, their chance of
initial approval would go up by 50 percent. That's really an
unacceptable result. Justice, simple justice, demands that
there be more consistency in the program.
And we would urge that Congress ensure that Social Security
Administration has the authority and has the mandate from
Congress to remedy that. That needs to be done by closer
oversight, the resources for that oversight, and enforcement
action, training, or whatever is necessary.
We fully support the improved increased technology that
Social Security has implemented. It's been a tremendous
benefit, having electronic files. I can conduct hearings in
three states in one week without ever leaving Atlanta. That's a
great benefit. But we have to remember that every case is a
human being who needs his day in court, who needs his due
process, and who needs to be able to tell an impartial judge
his story.
Technology can't do everything. Only people can do it,
people who have the time, the ability, and the willingness to
stop and listen and understand the details of that individual's
case and their medical history.
I believe the inspector general covered most of what I
wanted to say about continued disability reviews. But I would
like to point out that, beside being a tremendous benefit to
the taxpayer, saving $10 for every $1 spent, they are also, in
a way, are a benefit to the claimants. Claimants who know that
they will face a continuing disability review are provided an
added incentive to take advantage of medical care, vocational
services, and other services to get themselves back into the
workforce. Sometimes they need that extra push.
But part of that process is that claimants who disagree
with the findings have a right to a due process hearing before
an administrative law judge. So we have to understand that when
we fund CDRs, we also have to fund the judges and the staff to
hear those disability claims.
Thank you, Mr. Chairman, Mr. Johnson, for your time. I
would be happy to answer any questions.
[The prepared statement of Judge Auerbach follows:]
Prepared Statement of The Honorable Larry A. Auerbach, Administrative
Law Judge, on behalf of the Federal Bar Association, Atlanta, Georgia
I am Larry Auerbach and I am appearing here on behalf of the Social
Security Section of the Federal Bar Association. I am an Administrative
Law Judge (``ALJ'') in the Office of Disability Adjudication and Review
of the Social Security Administration in the Atlanta, Downtown hearing
office. While having only been an ALJ for three and one-half years, I
have heard and decided approximately 1,700 appeals. Prior to becoming
an ALJ, I was an attorney for 27 years with the Office of the
Solicitor, U.S. Department of Labor; during the last 12 of those years
I served in various management positions, including Deputy Regional
Solicitor.
I am pleased to be here today representing the Social Security
Section of the Federal Bar Association. My remarks are exclusively
those of the Social Security Section and do not necessarily represent
the views of the Federal Bar Association as a whole. Moreover my
remarks do not reflect the views of the Social Security Administration.
Unlike other organizations associated with Social Security
disability practice that tend to represent the interests of one
specific group, the Federal Bar Association's Social Security Section
embraces all attorneys involved in Social Security disability
adjudication.\*\
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\*\ Our members include Attorney representatives of claimants,
Administrative Law Judges, Administrative Appeals Judges, staff
attorneys in the Office of Disability Adjudication and Review,
attorneys in the Social Security Administration's Office of General
Counsel, U.S. Attorneys and Assistant U.S. Attorneys, U.S. Magistrate
Judges, District Court Judges, and Circuit Court Judges.
---------------------------------------------------------------------------
The common focus of the FBA's Social Security Section is the
effectiveness of the adjudicatory process at all phases including
hearings in the Office of Adjudication and Disability Review (ODAR),
the appeal process before the Appeals Council, and judicial review
through the federal courts. Our highest priority is ensuring the
integrity, fairness, independence, and effectiveness of the Social
Security disability adjudication process to those it serves--both
Social Security claimants themselves and the American taxpayers who
have an interest in ensuring that only those who meet the criteria for
eligibility receive these benefits.
We appreciate the continuing commitment that the Social Security
Subcommittee has shown for fair and effective adjudication of
disability claims. As we will discuss in more detail below, your
support has enabled the Social Security Administration to reverse the
long-standing trend toward increased backlogs and longer wait times.
Most importantly, this is being done without sacrificing due process.
We strongly believe that the growing disability claims workload can,
and indeed must, be addressed without limiting claimants' opportunity
for full due process at every stage. In fact, we believe that affording
due process at every stage is essential to fulfilling the
Commissioner's objective of reaching the right decision at the earliest
possible stage of the process. The ODAR hearing before an impartial
judge is the method by which claimants have an opportunity to tell
their story. This right must never be abridged.
Increased staff and improved technology have had a dramatic and
positive effect on the disability appeals process. By way of example,
in October 2009 ODAR had 66,200 case dispositions. This is an increase
of almost 60 percent from October 2007 when there were 41,361
dispositions. We applaud Congress for the funding which has made this
possible. Nevertheless, delays remain at unacceptable levels.
Furthermore, increases in applications will strain even the increased
resources. A growing adjudicatory backlog is foreseeable unless
significant additional resources are provided.
When we speak of anticipated increases in case filings due to the
difficult economy, it is important to note that this is not based on
mere speculation. ODAR hears cases which have been appealed from state
Disability Determinations Services and in 2009 alone, there was a 38
percent increase in the number of disability claims received by these
state agencies. As we will discuss in more detail, projections call for
even greater increases in coming years.
We thank the Social Security Subcommittee for holding this hearing
and for keeping the attention of the American public on the problems
faced by hundreds of thousands of Americans who too often wait years
for a determination of their claims. The Social Security
Administration's Inspector General has reported that the long waits
adversely affect as many as 80 percent of all claimants, with 30
percent saying that the long waits impacted their access to health
care.
As a judge, I see the human face of these statistics. Few days pass
during which I do not see severely disabled individuals who have
suffered serious and even irreparable physical, emotional and economic
harm while awaiting a decision. It is sadly common to see medical
treatment notes which state, for example, that:
1. A claimant is awaiting approval of disability benefits so
he can have necessary back surgery.
2. A claimant could not afford his diabetes medication and has
now developed irreversible neuropathy or retinopathy.
3. A claimant's psychiatric condition has deteriorated because
of the lack of funds for therapy and medication.
It is also common to see individuals who have lost homes and cars
while awaiting a benefits determination. The losses do not just result
in the loss of creature comforts for claimants. They result in the loss
of safe and secure housing, the loss of transportation to medical care,
and even the loss of a stable address where claimants can be contacted
regarding their health or the status of their disability claim.
It is important to avoid viewing that disability adjudication
process as merely cold numbers and statistics. Each case represents a
human being, and often a family, whose lives are on hold awaiting a
decision. The time spent in each stage of the claims process--from
initial application to final determination--is a seemingly endless wait
to those in need. The maxim, ``Justice delayed is justice denied,'' is
never more true than in the disability adjudication process.
We commend the Commissioner on the great strides which have been
made in reducing the backlog and reducing wait times. The Commissioner
is in the fourth year of an ambitious program ensuring that those
claimants who have waited the longest have their claims adjudicated. In
the first year of this program, the Commissioner directed that all
claimants whose hearing requests would have been pending for 1000 or
more days received ALJ decisions by the end of fiscal year 2007. Each
year, the Commissioner has set his goal as shortening this time, and he
has achieved each goal.
The current goal is that by the end of fiscal year 2010, ODAR will
have held hearings and issued decisions for every claimant whose
request for hearing would be 800 days old by that date. The goal is to
ensure that all claimants who requested a hearing on or before July 18,
2008 receive an ALJ-issued decision by September 30, 2010. This goal is
achievable, but we must note that upon meeting this goal we will still
have claimants who have waited for a decision well over two years since
their request for hearing. It is also important to remember that these
claimants all have been through the mandatory state Disability
Determination Service (``DDS'') administrative process prior to
requesting a hearing, a process that commonly takes six months to one
year.
Our testimony today advances five recommendations:
1. State Disability Determination Services should be provided
significantly enhanced resources.
2. SSA should continue to hire Administrative Law Judges and
support staff, and add needed hearing offices.
3. SSA should continue to develop and implement improved
technological and other initiatives.
4. New efforts are needed to accomplish the Commissioner's goal of
making the right decision at the earliest possible stage.
5. Continuing Disability Reviews should be fully funded at every
stage of the process.
Let's examine each of these recommendations:
1. State Disability Determination Services should be provided
significantly enhanced resources.
Initial disability determinations are made by state Disability
Determination Services. These state agencies are funded by the Federal
Government. Only claimants who are denied fully favorable decisions by
these agencies may request hearings before an Administrative Law Judge
in ODAR. These DDS decisions have a major impact on the workload of
ODAR and play a vital role in the disability process. In these
difficult economic times, the number of disability claims is increasing
dramatically. In fiscal year 2009 there were 385,000 more claims filed
than in the prior fiscal year. This is a one-year increase of
approximately 15 percent. Estimates are that in 2010 there will be
733,000 more disability claims filed than in fiscal year 2008. Current
estimates by SSA's Office of Budget indicate that in fiscal years 2009
through 2012 there will be over 2.25 million more disability claims
filed than there would have been if the 2008 rate had remained
constant. This is a staggering increase in the workload of DDSs.
Aging baby boomers, inadequate healthcare, and decreased jobs
in the economy all contribute to the projected increase in the number
of claims. The increased numbers of claims do not represent simply
unemployed individuals who are capable of competitive work. Many are
individuals who, due to mental or physical impairments, were marginally
productive workers in years past. In today's struggling economy,
businesses find that they simply cannot afford to retain such workers.
Of course, all claimants, whether or not they qualify for benefits, are
entitled to a fair and timely adjudication of their claims.
The DDSs are overburdened and improved efficiency cannot
prevent the increased numbers of applicants from causing delayed
decisions by the DDS. Further, increased pressure on state workers to
decide more and more cases is likely to decrease the time spent on each
determination and thus negatively impact the accuracy of the decisions
made. Such a result would be detrimental to the claimants who may be
wrongly denied benefits, as well as to American taxpayers who will bear
the costs of improperly granted benefits.
The problem is further exacerbated by the many states who, for
economic reasons, have furloughed state employees, including DDS
workers. Despite the fact that 100 percent of the salaries and overhead
expenses of DDS employees is borne by the Federal Government, these
states have decreased the number of DDS workdays available to process
the increased number of cases. Some governors have continued their
``savings'' despite the fact that two months ago Vice President Biden
sent a letter to Governor Edward Rendell of Pennsylvania, the Chair of
the National Governor's Association, urging that DDS employees be
exempt from state furloughs.
This situation requires immediate attention. We urge Congress
to respond by not only providing adequate funding for DDS, but also
requiring full work weeks for DDS employees.
2. SSA should continue to hire Administrative Law Judges and support
staff, and add needed hearing offices.
In the last 18 months, SSA has significantly increased the
number of Administrative Law Judges and support staff. These increases
are ongoing and many of the newest staff are still working their way to
full productivity. This increase in resources already has resulted in a
dramatic increase in the number of adjudications. It is important to
note that ODAR has not simply added people; it has added a corps of
highly competent and dedicated individuals. Each decision made by ODAR
judges is important to the taxpayers and is critical to the claimant.
Our newest judges have shown themselves to be capable adjudicators who
understand how important it is to make the right decision and how to do
so with speed and efficiency.
The Commissioner has wisely matched increased numbers of ALJs
with significant increases in support staff. It is critical that the
numbers of ALJs and support staff continue to increase. As I commented
at a recent staff meeting, statistics may indicate that I produced a
certain number of dispositions, but that is misleading. I do not decide
cases by acting alone. There are staff members who organize the
evidence and schedule the hearings, others who obtain missing medical
evidence and arrange for necessary consultative examinations, and still
others who perform a myriad of tasks essential to the adjudicatory
process. In addition, staff attorneys and paralegals turn decisional
instructions into draft decisions. Each case disposition is the product
of a team of individuals.
Commissioner Astrue has recently increased the support staff to
ALJ ratio from just over four support staff members per ALJ to about
four and one-half support staff members per ALJ. We believe that this
increase will add efficiency to the adjudicatory process. We commend
the Commissioner for this staffing decision. As we move to greater
reliance on technology, it is hard to predict what the most effective
and efficient ratio will be. We urge the Commissioner to continue to
monitor the staffing ratios so as to maximize the ALJ's ability to
produce legally sound and just decisions.
As discussed later, electronic processes have substantially
increased efficiency. However, there is a critical limit to this. Each
decision requires a judge to analyze and fully understand the medical
evidence and other documentation in a file. The judge must then use
good judgment to apply the law to the facts he finds. Electronics
cannot replace human judgment. No matter how efficient our
technological processes become, critical judgments must be made
thoughtfully by human beings. If for no other reason, this immutable
fact requires that there be increased staffing. Otherwise, the
increased number of claims will exacerbate the unconscionable delays
which have been faced by citizens who have come to their government in
their time of need.
The Commissioner has opened two national hearing offices and
plans to open two more. These offices conduct video hearings in states
where they are most needed. This has helped reduce the backlog and
improve the disposition time. In addition, the Commissioner plans to
build 13 traditional hearing offices around the country. If these are
properly located and staffed, they should help reduce the backlog of
cases.
Efficient and fair adjudication can be advanced through greater
use of technology, and SSA is making that happen. But we cannot rely on
technology alone. SSA must continue to increase its cadre of well-
trained, skilled, motivated, and caring employees--both ALJs and
support personnel.
3. SSA should continue to develop and implement improved technological
and other initiatives.
SSA is rapidly moving to implement a fully electronic business
process. This process has significantly enhanced efficiency. I fully
expect that the implementation of newer technology and processes will
further enhance efficiency. Electronic files have also helped improve
the decisional process by making it easier for the judge to fully
review the evidentiary record.
Improved use of technology has also enhanced the efficiency and
productivity of ODAR. Funding hardware and software for full
implementation of technological advances is undoubtedly expensive.
However, we believe that doing so is essential to reduce the hearing
backlog. In the long run, technology will save many times its cost and
it will greatly assist SSA's ability to provide timely and just
decisions.
Video hearings enable judges to conduct hearings without
traveling to remote hearing sites. Judges are able to interact with
claimants by videoconferencing so that the claimants can be seen and
heard as if they were in the hearing room with the judge. This has
added to ODAR's flexibility in using resources where they will be most
effective in accomplishing our mission and reducing our backlog. As an
example, in a single week I have conducted live hearings in Atlanta,
Georgia and video hearings with claimants in Greenville, North Carolina
and Tampa, Florida. By teleconferencing, I did this without travel
expenses and with no work time spent traveling.
Video hearings may not be right for every claimant. Some of the
Federal Bar Association Social Security Section's members have
expressed concerns that video hearings may make it more difficult for
judges to accurately decide issues such as pain or mental health, or
may make some claimants unduly nervous or confused. The Commissioner's
rules permit claimants who are concerned about video hearings to opt
out of such hearings and to have an in-person hearing without undue
delay in their cases. This option is an important protection for the
claimants' right to due process. If this option were to be eliminated,
the credibility of the hearing process would be undermined.
ODAR is rapidly moving to the point where all evidence will be
stored electronically and there will be no paper files. The advantages
of this are numerous. When working with thousands of paper files, it
was too common for staff to have to take valuable time to search for a
file that had accidentally been misfiled, was being reviewed by an
expert witness, or had simply been mislaid. This wasted time has been
eliminated.
In addition, the production of electronic copies of the record
for use by claimant's representatives, or medical or vocational experts
in advance of the hearing is much easier and faster. In the past, the
claimants' representatives had to arrange to review voluminous files in
ODAR offices or arrange for them to be copied. Now, in a fraction of
the time previously required, an electronic copy can be created for the
experts and the claimants' representatives.
ODAR is implementing a technology referred to as the
``Representatives Suite of Electronic Services.'' This will permit
claimants' representatives to view the complete up-to-date evidentiary
file on their own computers. Security safeguards are being built into
this system to prevent unauthorized access to the obviously highly
sensitive documents in claim files. When this system is fully
implemented, it will save resources that are now spent providing
claimant representatives computer disks with file information.
Currently, this often occurs two or more times in a single case to
ensure that the representative has current information during
preparation. This technology will also reduce time spent in hearings
ensuring that all evidence is in the file.
ODAR has a number of judges and decision writers who work
flexi-place on a regular basis. This is consistent with Government
policies encouraging flexi-place and tele-work. Currently these
employees must have computer disks made for each file. This consumes
significant time and creates a huge number of disks that have to be
destroyed. We recommend that the Commissioner explore improvements in
technology to allow SSA employees to have the same secure access to
electronic files that claimants' representatives will have.
There are other, as yet unexplored, technological tools that
will be of great value. These might include the ability to search all
of the medical evidence in a file for key words or dates so that a
judge can more readily review all medical evidence related to a
particular impairment or a particular time period.
Increased use of senior attorneys has been another important
tool in enhancing ODAR's efficiency. We commend the Commissioner for
permitting senior attorneys to review files and issue fully favorable
decisions when warranted by the evidence. We look forward to the
creation of the Virtual Screening Unit, whose establishment is under
way. One hundred senior attorneys in this unit will review cases
selected by a sophisticated computerized process as potentially
appropriate for fully favorable decisions without a hearing. These
initiatives involving senior attorneys will enable deserving claimants
to get earlier decisions and free up ALJs to hear and decide more
difficult cases.
4. New efforts are needed to accomplish the Commissioner's goal of
making the right decision at the earliest possible stage.
The DDSs make the initial determinations regarding disability
claims and therefore have the first opportunity to make the correct
decision. While these agencies operate with federal funds under a
uniform set of federal rules and regulations, the outcomes are far from
uniform. Even a cursory glance at approval rates by various DDSs shows
that there are significant disparities among the states. In fiscal year
2008, Georgia and Tennessee DDSs approved benefits on initial
determination in only 25 percent of the claims filed. In contrast, in
2008 Virginia DDS awarded benefits to 44 percent of its claimants on
initial application, while New Hampshire DDS granted benefits to 52
percent of its claimants at that stage. These disparities cannot
reasonably be explained by state or regional population differences. In
2008, Mississippi DDS approved 24.5 percent of claims at the initial
stage while in the neighboring state of Arkansas, the rate was 36
percent (almost 50 percent higher.) Similarly Connecticut DDS's rate
was 33 percent approval compared to its neighboring states of New York
(44 percent), Massachusetts (46 percent), and Rhode Island (38
percent).
My own personal experience is based upon a relatively small
sampling of primarily Georgia disability claims. I do not see claims in
which benefits are awarded by the state DDS, but I have had the
opportunity to review a large number of claims that have been denied by
the Georgia DDS. Other members of the Federal Bar Association have
shared their experiences with me as well. Based upon this experience,
it appears that all too often, the DDS has paid scant attention to the
effect of pain and fatigue on a claimant's ability to work. This occurs
despite Social Security Rulings that mandate consideration of these
factors.
The disparities among states should be addressed for a number
of reasons. The first and foremost is basic justice. The outcome of a
claimant's case should not depend on his or her state of residence. In
addition, improper early stage denials cause undue hardship to
claimants and increase the workload, and thus the backlog, of hearing
offices. If higher approval rates are the result of improper approvals,
this places an unnecessary burden on American taxpayers.
SSA has a quality review process that is designed to ensure
that state DDSs follow federal rules. This process should be enhanced
to ensure accurate and fair determinations. Where SSA review shows a
significant error rate, the Commissioner should take, or be required to
take, action. This should include the delivery of enhanced training to
DDS staff and management and closer oversight of the state's work until
significant progress is made. For the benefit of the claimant and the
taxpayer, SSA needs to receive and be a good steward of the resources
and authority provided by Congress, and Congress needs to continue to
exercise the necessary oversight.
5. Continuing Disability Reviews should be fully funded at every stage
of the process.
SSA conducts Continuing Disability Reviews (CDRs) to assure
that recipients of disability benefits continue to satisfy eligibility
requirements. CDRs serve two important purposes. First, they save
taxpayer money. As Commissioner Astrue noted in his March 24, 2009
testimony before this subcommittee, every dollar spent on CDRs yields
ten dollars in program savings. Second, CDRs provide recipients an
incentive to fully utilize available medical care, vocational
rehabilitation services, and job training to help them re-enter the
workforce.
Because of inadequate funding levels for over a decade, SSA has
accumulated a significant backlog of nearly 1.6 million full medical
Continuing Disability Reviews. The failure to timely conduct these
reviews has significantly affected the federal budget and the deficit.
It has been estimated that, if these CDRs had been conducted on a
timely basis, over $20 billion in long-term Social Security program
savings would have been achieved. Unfortunately, current estimates
project that SSA will only be able to conduct 329,000 full CDRs in FY
2010.
Funding of CDRs will not reduce the hearing backlog and, in
fact, it may add to it. When benefit recipients are found to no longer
be eligible for benefits, some will seek hearings challenging these
determinations. These hearings are an important due process right that
should not be abridged. Full funding for CDRs must include additional
funding for ODAR to adjudicate CDR appeals. This will require funding
above that needed to eliminate the backlog of initial claims. When
considering this additional funding, it is important to keep in mind
the savings created by CDRs. Conducting continuing disability reviews
is the right thing to do for the taxpayers and for the recipients of
benefits.
Mr. Chairman, thank you once again for the opportunity to appear
before you and the subcommittee today. The Social Security Section of
the Federal Bar Association looks forward to working with you and the
Social Security Administration in improving the disability adjudication
process. I would be happy to answer any questions you may have.
Chairman TANNER. As I said earlier, if you all would agree,
Members will submit questions following the hearing. Would that
be acceptable?
Judge AUERBACH. Absolutely.
Chairman TANNER. We got here late because of votes, we've
got to leave early because of votes. I have got to say, and I
know Mr. Johnson agrees because we have talked about this, we
take this obligation very seriously. Your testimony will be
carefully and closely considered and utilized. We appreciate
you very much being here.
Ms. KENNELLY. Mr. Chairman.
Chairman TANNER. Barbara, do you want to say something?
Ms. KENNELLY. Yes, I want to say one thing, and Ranking
Member Johnson talked about it. The technology at Social
Security is behind the times. When you're talking about
hundreds and hundreds of thousands of cases that need to be
determined, I feel we are not doing enough about the
technology.
You know what we're going to do? We're losing money, we're
losing taxpayers' money about this. The COBOL system is
terrible, and you two can change it. You could do it. That's
all.
[Laughter.]
Mr. JOHNSON. It's going to take seven years to fix it.
Ms. KENNELLY. No, you know Sam, you could do it.
Chairman TANNER. We are trying, let me say that.
I thank all of you all for being here, and we very much
appreciate your efforts to alleviate what is the backbone,
really, in many ways, of our society. Thank you a lot. We stand
adjourned.
[Whereupon, at 3:33 p.m., the Subcommittee was adjourned.]
[Questions for the Record follow:]
[The questions submitted to the Honorable Michael J. Astrue
from Chairman John Tanner for the Record follow:]
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[The questions submitted to the Honorable Patrick P.
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Statement of the Corporation for Supportive Housing Advocacy and
Training Center
Chairman Tanner, Ranking Member Johnson, and Members of the
Subcommittee:
Thank you for the opportunity to submit written testimony on the
issue of the Social Security Administration's disability claims
backlog.
Our organizations are committed to providing housing, services and
advocacy to individuals who have no or limited income and who have
disabilities, especially those involving serious mental illness and/or
co-occurring disorders. As part of this commitment, we particularly
focus on individuals who have been or are homeless, many of whom have
experienced homelessness for years. We appreciate the recent efforts of
the Social Security Administration (SSA) to address the disability
claims backlog, specifically those claims awaiting hearing level
decisions. The reduction in this backlog that has started and the
ongoing efforts to reduce it are commendable.
We believe that aspects of the disability determination that
contribute to denials for people who are homeless and, therefore, to
the need for appeals include, the following:
Lack of access to medical care and evaluations needed
to document individuals' physical and mental health conditions;
Need for case managers or other community staff to
conduct outreach and to help homeless individuals to navigate
the complex disability determination process;
Difficulties in accessing benefits for people who
have co-occurring disorders that include substance use;
For people who have mental illness and/or cognitive
disorders, lack of recognition of long-term homelessness as an
indicator of marked functional impairment;
General inability of individuals with serious mental
illness to access the innovative and creative strategies that
SSA has implemented such as Quick Disability Determination and
compassionate allowances;
Need for specialized training of SSA and DDS staff in
understanding homelessness and its impact on individuals'
health; and
Failure to identify claimants as homeless and failure
to flag claims from homeless individuals as in need of
expedited processing.
To address some of the needs of this population, we advocate for
changes that only Congress can enact as well as changes that are
underway or could be considered at SSA. These include:
SSA:
Include schizophrenia and homelessness as a
compassionate allowance category, something already considered
by SSA as evidenced by the recent compassionate allowance
hearing on schizophrenia held in San Francisco on November 18;
Consider compassionate allowances for homeless
individuals with other specified impairments, such as bipolar
disorders and certain cognitive impairments;
Partner with community mental health and other health
providers to assist people who are homeless with navigating the
SSA disability application process. This would include training
such providers in the completion of the SSI application (SSA-
8000) (until the SSI application is possible to do on-line) so
that such providers could submit such applications on behalf of
individuals without having to have the applicant come into the
SSA office;
Implement promising practice models such as SOAR to
serve populations who need special assistance, adults who are
homeless and who have mental illness and partner with other
federal agencies including, SAMHSA, to coordinate
implementation of such models
Conduct specialized training for SSA and DDS staff in
homelessness, mental illness, and co-occurring disorders, and
in identifying and expediting claims of individuals who are
homeless;
specific staff at the SSA local offices and encourage
state Disability Determination Service offices to assign DDS
staff to expedite and do medical reviews of homeless claimants,
so as to have staff who become specialized in providing
services to people who are homeless and who have mental illness
and/or co-occurring disorders;
Provide specific direction to the DDS regarding the
interpretation of current requirements for the consideration of
people with co-occurring disorders to improve consistency and
generate greater understanding of these requirements across the
country;
Congress:
Re-visit the 1996 statutory change regarding
substance use in the SSA disability determination process.
Currently, if a person has substance use that is deemed
``material'' to one's disability, that individual is denied.
Such a consideration is often virtually clinically impossible
in the face of ongoing substance use. Most treating physicians
do not and cannot make this determination, let alone medical
reviewers who are asked to create this distinction based on an
individual's paper record. In addition, many individuals who
have these disorders use substances to address symptoms of
mental illness, e.g., auditory hallucinations, significant
depression, manic symptoms, etc. Much documentation proves the
link between mental illness and substance abuse. Yet, because
of the difficulty in deciding whether a person's substance
abuse is material to an individual's disability, homeless
people who are, in fact, disabled are often denied. Current
statutory requirements are contrary to the evidence regarding
assessment and treatment of people who have these disorders. It
would be an important step for Congress to reconsider this
statute and its impact after 13 years of its implementation.
Provide funding to SSA to partner with community
providers to offer the necessary assistance to help individuals
who are homeless and who have serious mental illness and/or co-
occurring disorders with navigating the SSA disability
application process.
Begin to conduct a dialogue on the array of public
benefits that need to be available to assist individuals and
families to exit long-term poverty, and help these individuals
address poverty that results from loss of jobs, poor education,
health difficulties that do not rise to the level of
eligibility for SSA benefits.
We thank you for the consideration of our comments.
Sincerely,
Corporation for Supportive Housing Advocacy and Training Center
Statement of Council of State Administrators of Vocational
Rehabilitation
The Council of State Administrators of Vocational Rehabilitation is
pleased to submit this statement for the record for the November 19,
2009, House Ways and Means Social Security Subcommittee's hearing on
the progress SSA has made in clearing the disability backlog.
CSAVR's members are the Administrators of 80 state agencies that
provide vocational rehabilitation services to persons with
disabilities. For over 80 years the State-Federal Vocational
Rehabilitation program has been providing a wide range of services to
people with disabilities. The program has helped million of people with
significant disabilities return to work and live better and more
productive lives.
The VR program is a cost effective program with a proven track
record. In 2007 the Public VR program and its partners helped over
200,000 people with disabilities find, return to, or retain employment.
VR customers earned over $3.0 billion in wages, paid $966 million in
federal, state, & local taxes, and generated 36,000 new jobs. In fact,
on average every person VR helps find or retain employment will ``pay
back'' through taxes the cost of their rehabilitation services in just
two to four years.
The VR program and the Social Security Administration have a long
and mutually beneficial partnership helping people with disabilities on
SSDI and SSI return to work. SSA reimburses VR agencies for the cost of
services VR provides to SSDI and SSI beneficiaries after a beneficiary
is at work for nine months. VR agencies are also strong partners in
SSA's Ticket-to-Work program. The most recent data from the Social
Security Administration reveals that for every dollar SSA reimburses
VR, SSA has saved seven dollars in benefits that it would have paid
out. This results in an annual net savings of $754 million to the
Social Security (SSDI) and Supplemental Security Income (SSI) programs.
CSAVR's interest in this hearing and on the issue of the backlog
stems from the fact that nearly 60 percent of SSA's state Disability
Determination Service (DDS) agencies are under the direction of state
VR agencies. Our members see every day the growing burden caused by the
lack of funding and the expanding demand for benefits caused by the
current economic downturn.
CSAVR has strongly supported the Subcommittee's efforts to boost
appropriations for clearing the disability backlog at all levels. We
applaud Commissioner Astrue and his team for their dedication to
aggressively resolving this problem. This issue is extremely important
to people with disabilities.
Title II and SSI cash benefits, along with the related Medicaid and
Medicare benefits, are the means of survival for millions of
individuals with severe disabilities. They rely on the Social Security
Administration (SSA) to promptly and fairly adjudicate their
applications for disability benefits. They also rely on the agency to
handle many other actions critical to their well-being including:
timely payment of the monthly Title II and SSI benefits to which they
are entitled; accurate withholding of Medicare Parts B and D premiums;
and timely determinations on post-entitlement issues that may arise
(e.g., overpayments, income issues, prompt recording of earnings).
Because the economic downtown has led to an unexpected surge of new
applications, SSA finds itself at a critical crossroads. The wave of
new claims is having a very significant impact at the state Disability
Determination Services (DDSs) that will eventually affect the hearing
level. At the DDS level (initial and reconsideration), the number of
new applications, applications waiting for a decision, and processing
times are all on the rise. In fiscal year (FY) 2009, SSA received
385,000 new claims, an increase of nearly 15% since the end of FY 2008.
Even more worrisome is the growing backlog of pending initial claims at
the DDSs, i.e., those waiting for a decision, up nearly 40% since the
end of FY 2008.
In FY 2009, the news was more positive at the hearing level. For
the first time in a decade, SSA finished FY 2009 with fewer hearing
level cases waiting for a decision and hearing than at the beginning of
the year. But we are deeply concerned that any progress in eliminating
the hearing level backlog will be delayed as the surge of new
applications that are denied are appealed, putting SSA's plan to
eliminate the hearing level backlog by 2013 at risk.
While recent appropriations have allowed SSA to hire some new staff
and to reduce processing times at the hearing level, these amounts will
not be adequate to fully restore the agency's ability to carry out its
mandated services. Given the many years of under-funding and the need
for more than a $600 million annual increase just to keep up with fixed
costs, additional funding is required to reduce and eliminate the
backlog at the DDS and hearing levels and to provide essential services
to the public. While the current situation is dire, without adequate,
ongoing appropriations to fund SSA, the forward progress recently made
by the agency will deteriorate, leaving people with severe disabilities
to wait years to receive the benefits to which they are entitled.
THE IMPACT ON PEOPLE WITH DISABILITIES
As the backlog in decisions on disability claims continues to grow,
people with severe disabilities have been bearing the brunt of the
delays. Behind the numbers are individuals with disabilities whose
lives have unraveled while waiting for decisions--families are torn
apart; homes are lost; medical conditions deteriorate; once stable
financial security crumbles; and many individuals die.\1\ Numerous
recent media reports across the country have documented the suffering
experienced by these individuals. Your constituent services staffs are
likely to be well aware of the situations faced by people living in
your districts and provide valuable assistance and help, where
possible.
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\1\ If a claimant dies while a claim is pending, the SSI rule for
payment of past due benefits is very different--and far more limited--
than the Title II rule. In an SSI case, the payment will be made in
only two situations: (1) to a surviving spouse who was living with the
claimant at the time of death or within six months of the death; or (2)
to the parents of a minor child, if the child resided with the parents
at the time of the child's death or within six months of the death. 42
U.S.C. Sec. 1383(b)(1)(A) [Section 1631(b)(1)(A) of the Act]. In Title
II, the Act provides rules for determining who may continue the claim,
which includes :a surviving spouse; parents; children; and the legal
representative of the estate. 42 U.S.C. Sec. 404(d) [Section 202(d) of
the Act]. Thus, if an adult SSI claimant (age 18 or older) dies before
actually receiving the past due payment and if there is no surviving
spouse, the claim dies with the claimant and no one is paid.
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SSA'S NEED FOR ADEQUATE RESOURCES TO ADDRESS GROWING BACKLOGS
For many years, SSA did not receive adequate funds to provide its
mandated services, a key reason for the hearings backlog. Between FY
2000 and FY 2007, the resulting administrative funding shortfall was
more than $4 billion. The dramatic increase in the hearing level
disability claims backlog coincided with this period of significant
under-funding.
Recent Congressional efforts to provide SSA with adequate funding
for its administrative budget have been encouraging. In FY 2008, the
tide finally changed for the first time in a decade, when Congress
appropriated $148 million over the President's budget. The FY 2009 SSA
appropriation provided SSA with more than $700 million over the FY 2008
appropriation.
CSAVR is extremely grateful to Congress for recognizing SSA's need
for adequate resources and including additional funds for SSA in the
American Recovery and Reinvestment Act of 2009 (ARRA). ARRA provided
SSA with $500 million to handle the unexpected surge in both retirement
and disability applications due to the economic downturn. SSA also
received badly needed funds to replace its aged National Computer
Center. With the FY 2009 appropriation and the ARRA funding, SSA
planned to hire 5,000 to 6,000 new employees. This additional staff
undoubtedly led to SSA's ability to make progress on the backlog at the
hearing level.
Congress appears to be moving towards providing SSA with an FY 2010
appropriation approximately the same as President Obama's request of
$11.45 billion for SSA's Limitation on Administrative Expenses (LAE), a
10 percent increase over the FY 2009 appropriation. While the agency is
operating under a Continuing Resolution, we are optimistic that SSA's
final FY 2010 appropriation will be similar to the $11.45 billion
amount, allowing SSA to hire more staff.
SIGNIFICANT INCREASE IN NEW CLAIMS FILED AND GROWING DDS BACKLOGS
Since the end of FY 2008, new disability claims filed have been
climbing steadily, up nearly 15% by the end of FY 2009. But what is
more troubling is how the increase grew throughout FY 2009: December
2008 Quarter: 6.92%; March 2009 Quarter: 15.23%; June 2009 Quarter:
16.32%; September 2009 Quarter: 20.25%.
The most alarming trend is the increase in the number of pending
claims (initial and reconsideration levels), up 38.8% since the end of
FY 2008 and climbing from 763,183 to 1,059,241. This means that, at the
end of FY 2009, more than 1 million disability applicants were waiting
for a decision on their claims at the initial and reconsideration
levels. When you add the 722,822 pending cases at the hearing level,
nearly 1.75 million people with disabilities were waiting for a
decision. If the receipts continue to increase at the higher level seen
in recent months, the total number of pending initial applications in
the DDSs could hit over 1,000,000 claims by the end of FY 2010. This
would be an 80% increase in pending claims at the initial level in just
one year.
What does the increase in applications and pending claims at the
DDSs mean for the hearing level? Approximately 22% of the initial
claims will result in a hearing request. This means there is a
potential increase of 85,000 additional hearings from the FY 2009
applications, a statistic that underscores the fragility of the ODAR
progress accomplished in FY 2009.
Exacerbating the problem of a significant increase in new claims is
the impact on DDSs of state budget crises. Even though DDS salaries,
offices, and overhead are fully funded by SSA, some states are imposing
hiring restrictions and furloughs of DDS workers because of budget
problems. Earlier this year, Commissioner Astrue wrote to Governors,
asking them to exempt DDSs from hiring freezes and furloughs. In
September 2009, Vice-President Biden sent a letter to Gov. Edward
Rendell, the Chair of the National Governors' Association, also urging
that states exempt DDS employees from state furloughs.
Nor are State budgets likely to see improvement in the near term.
According to the National Governors Association/National Association of
State Budget Officers (NGA/NASBO) Fall 2009 Report, Fiscal Survey of
States-Preliminary Data, November 12, 2009, ``Fiscal conditions
significantly deteriorated for states during fiscal 2009, with the
trend continuing through fiscal 2010 and even into 2011 and 2012. The
severe national recession drastically reduced tax revenues from every
revenue source during fiscal 2009 and revenue collections are
forecasted to continue their decline in fiscal 2010. As state revenue
collections historically lag behind any national economic recovery,
state revenues will remain depressed throughout fiscal 2010 and likely
into fiscal years 2011 and 2012. The economic recession, which began in
December 2007, has significantly affected state spending, as more than
half the states decreased their General Fund expenditures in fiscal
2009, and two-thirds of states enacted fiscal 2010 budgets with
decreased General Fund spending.
The weakening of state fiscal conditions is also reflected in the
fact that states will have faced $250 billion in budget gaps between
fiscal year 2009 and fiscal year 2011. Of this $250 billion, states
closed $72.7 billion in budget gaps during fiscal 2009 and $113.1
billion prior to the enactment of their fiscal 2010 budgets in order to
bring them into balance with drastically declining revenues. However,
even after solving these gaps, an additional $14.5 billion in budget
gaps remains in fiscal 2010 and states face at least $21.9 billion in
budget gaps for fiscal 2011. In order to help close these gaps, 42
states cut their enacted fiscal 2009 budgets by $31.2 billion and 33
states cut their fiscal 2010 expenditures by $53.5 billion.
Additionally, states enacted tax and fee increases of $23.8 billion
along with additional increases in other revenue measures of $7.7
billion for fiscal 2010.''
Despite this bleak fiscal picture in the states and in the face of
furloughs and hiring freezes, some state agencies have been successful
in working around the problem of DDS furloughs by negotiating overtime
and other work arrangements that allow DDS staff to keep their caseload
as current as possible. However, even these stopgap measures will
become more difficult to maintain as fiscal pressures continue to mount
within state budgets and the number of new claims increase.
WILL THE HEARING LEVEL BACKLOG BE ELIMINATED BY 2013?
The average processing time for cases at the hearing level has
increased dramatically since 2000, when the average time was 274 days.
In FY 2009, the average processing time for disability claims at the
hearing level was 491 days, about 16.5 months. We appreciate the effort
by SSA to reduce the processing time, but an average of 16.5 months--
close to one and a half years--is still too long for individuals
waiting for a hearing decision. In addition, the average processing
times at the initial and reconsideration levels are increasing. For
individuals with disabilities who have no health insurance, have lost
their homes, have declared bankruptcy, or who have died, that is simply
too long to wait.
The current processing times in some hearing offices are striking,
and much longer than the 491-day average at the end of FY 2009. It is
important to keep in mind that this is an ``average'' and that many
claimants will wait longer. In September 2009, the average processing
time at 48 hearing offices was above the 491 day national average, with
20 offices over 600 days.
Is the Hearing Backlog Improving? By the end of FY 2009, it was
clear that ODAR was making slow but steady process in key areas to
address its backlog and improve processing times, thanks to the hard
work of ODAR ALJs and staff and the additional resources available due
to Congressional appropriations, including the ARRA funding.
Pending cases. For the first time in a decade, ODAR
finished FY 2009 with fewer hearings pending than in the prior
year. The increased resources, including 147 new ALJs and
support staff are having a positive impact at the hearing
level. The pending number of cases dropped for nine straight
months from a record high of 768,540 in December 2008 to
722,822 in September 2009. This is the lowest pending number of
ODAR cases since February 2007. The pending number dropped by
11,377 in September 2009 alone, the biggest drop in FY 2009.
The reduction in pending cases is even more notable since the
number of requests for hearing increased in FY 2009, up to
625,003, a 5.7% increase over the 591,888 received in FY 2008.
Processing times. The average process time in
September 2009 was 472 days, the lowest monthly processing time
since November 2005. The average processing time for all of FY
2009 was 491 days, down from 514 days in FY 2008.
Dispositions. The number of dispositions cleared by
ALJs on a daily basis was 2,940.47 in September. This is the
highest monthly average since records have been kept, beginning
in FY 2004. The increase is concomitant with the record number
of ALJs now on duty. For the year, dispositions were up about
20%.
Age of pending cases. The length of time cases are
pending is also improving. The percentage of requests for
hearing pending over one year was 31% in September 2009. This
is the lowest percent since October 2004. The average age of a
pending case is 282 days. It peaked this year at 317 days in
January 2009.
Improvement Is Not Uniform. Despite the overall
improvement in the hearing level statistics, not every hearing
office has benefited and some claimants' areas are waiting even
longer than one year ago. On one hand, some offices have
experienced exceptional improvement in processing times, as
much as 4 to 5 months in just one year. In contrast, other
offices continue to experience worsening times that are several
months longer than last year.
SSA'S ABILITY TO PERFORM OTHER IMPORTANT WORKLOADS
Program Integrity Workloads. The processing of CDRs and SSI
redeterminations is necessary to protect program integrity and avert
improper payments. Failure to conduct the full complement of CDRs would
have adverse consequences for the federal budget and the deficit.
According to SSA, CDRs result in $10 of program savings and SSI
redeterminations result in $7 of program savings for each $1 spent in
administrative costs for the reviews. However, the number of reviews
actually conducted is directly related to whether SSA receives the
necessary funds. SSA's Budget Justification refers specifically to CDRs
based on medical factors. It is important when SSA conducts work CDRs
that it assess whether reported earnings have been properly recorded
and ensure that they properly assess whether work constitutes
substantial gainful activity (SGA).
Impact on Post-Entitlement Work. Staffing shortages also have led
to SSA's inability to fully carry out many other critical post-
entitlement workloads. One area that has slipped, often with a very
detrimental impact on people with disabilities, is the processing of
earnings reports by beneficiaries. When beneficiaries faithfully notify
SSA of earnings or other changes that may reduce their benefit payment
amounts, it may be months or years before SSA sends an overpayment
notice to the beneficiary, demanding repayment of sometimes tens of
thousands of dollars of accrued overpayments. It is shocking to
beneficiaries to receive these notices, when they reasonably assumed
that SSA had processed the information they submitted, and it is
challenging, if not impossible, for someone subsisting on benefits
alone to repay the overpayments. Many individuals with disabilities are
wary of attempting a return to work out of fear that this may give rise
to an overpayment, resulting in a loss of economic stability and health
care coverage upon which they rely.
SSA needs to develop a better reporting and recording system and
promptly adjust benefit payments--thus preventing these overpayments.
It is important to note that, in and of themselves, overpayments do not
indicate fraud or abuse as beneficiaries are encouraged to work if they
are able. The problems arise when reported earnings are not properly
recorded and monthly overpayments are not properly adjusted.
RECOMMENDATIONS REGARDING SSA'S ADMINISTRATIVE FUNDING
CSAVR is optimistic that SSA will receive a final FY 2010
appropriation of $11.451 billion for SSA's LAE, the same amount
proposed by the President. SSA will use this funding and about $350
million from the ARRA funding to address the growing workloads facing
the agency. Based on these funding levels, during FY 2010, SSA will be
spending at least $11.8 billion to address the current staffing levels
and associated costs necessary for the agency to function.
In FY 2011, SSA will be faced with additional costs of nearly $620
million just to deal with inflationary costs associated with items such
as salaries, benefits, rents, and facility security. The resulting
funding level, $12.42 billion will not address the increased number of
new claims, the newly created DDS backlog, and SSA's plan to eliminate
the hearing level backlog by 2013. To address these workloads, SSA will
need additional resources. We estimate that an additional $780 million
will be necessary--at least $480 million to address the increased
number of disability claims and at least $300 million to continue
making progress in reducing and eliminating the hearings backlog by
2013.
To address the unprecedented increase in workloads and to prevent a
severe disruption in service delivery, we recommend that a minimum of
$13.2 billion be included in the FY 2011 President's budget request for
SSA's administrative funding.
RECOMMENDATIONS FOR IMPROVING THE DISABILITY CLAIMS PROCESS
Money alone will not solve SSA's crisis in meeting its
responsibilities. Commissioner Astrue is committed to finding new ways
to work better and more efficiently. CSAVR has numerous suggestions for
improving the disability claims process for people with disabilities.
We believe that these recommendations and agency initiatives, which
overall are not controversial and which we generally support, can go a
long way towards reducing, and eventually eliminating, the disability
claims backlog.
Caution Regarding the Search for Efficiencies
While we generally support the goal of achieving increased
efficiency throughout the adjudicatory process, we caution that limits
must be placed on the goal of administrative efficiency for
efficiency's sake alone. The purposes of the Social Security and SSI
programs are to provide cash benefits to those who need them and have
earned them and who meet the eligibility criteria. While there may be
ways to improve the decision-making process from the perspective of the
adjudicators, the critical measure for assessing initiatives for
achieving administrative efficiencies must be how they affect the very
claimants and beneficiaries for whom the system exists.
People who find they cannot work at a sustained and substantial
level are faced with a myriad of personal, family, and financial
circumstances that will have an impact on how well or efficiently they
can maneuver the complex system for determining eligibility. Many
claimants will not be successful in addressing all of SSA's
requirements for proving eligibility until they reach a point where
they request the assistance of an experienced representative. Many face
educational barriers and/or significant barriers inherent in the
disability itself that prevent them from understanding their role in
the adjudicatory process and from efficiently and effectively assisting
in gathering evidence. Still others are faced with having no ``medical
home'' to call upon for assistance in submitting evidence, given their
lack of health insurance over the course of many years. Many are
experiencing extreme hardship from the loss of earned income, often
living through the break-up of their family and/or becoming homeless,
with few resources--financial, emotional, or otherwise--to rely upon.
Still others experience all of the above limits on their abilities to
participate effectively in the process.
Proposals for increasing administrative efficiencies must bend to
the realities of claimants' lives and accept that people face
innumerable obstacles at the time they apply for disability benefits
and beyond. SSA must continue, and improve, its established role in
ensuring that a claim is fully developed before a decision is made and
must ensure that its rules reflect this administrative responsibility.
Technological Improvements
Commissioner Astrue has made a strong commitment to improve and
expand the technology used in the disability determination process.
CSAVR generally supports these efforts to improve the disability claims
process, so long as they do not infringe on claimants' rights. Some of
the technological improvements that we believe can help reduce the
backlog include the following:
1. The electronic disability folder. The initiative to
process disability claims electronically has the prospect of
significantly reducing delays caused by the moving and handing-
off of folders, allowing for immediate access by different
components of SSA or the DDS, and preventing misfiled evidence.
2. Expanding Internet access for representatives. Under
Electronic Records Express (ERE), registered claimant
representatives are able to submit evidence electronically
through an SSA secure website or to a dedicated fax number,
using a unique barcode assigned to the claim. This initiative
holds great promise, given that significant problems with the
current process exist.
Under the current process, representatives are to be provided
with a CD of the exhibited or ``pulled'' file shortly before
the hearing and earlier in the process after the appeal has
been filed but before the file is exhibited. Due to staffing
shortages in hearing offices, representatives have had problems
obtaining the CDs and even obtaining barcodes, which allows me
to submit evidence electronically. We are optimistic that these
problems will be resolved in the near future.
3. Use of video hearings. Video hearings allow ALJs to
conduct hearings without being at the same geographical site as
the claimant and representative and have the potential to
reduce processing times and increase productivity. We support
the use of video teleconference hearings so long as the right
to a full and fair hearing is adequately protected; the quality
of video teleconference hearings is assured; and the claimant
retains the absolute right to have an in-person hearing as
provided under current regulations.\2\ However, we have
received complaints from representatives that, in some cases,
ALJs are discouraging claimants from exercising their right to
an in-person hearing. A new SSA pilot allows representatives to
participate in video hearings from their own private offices,
with their clients present in the representative's office. The
representative must agree to the terms established by SSA. This
pilot provides claimants with another option for their
hearings.
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\2\ 20 C.F.R. Sec. Sec. 404.936 and 416.1436.
Other Improvements at the Hearing Level
1. The Senior Attorney Program. This program allows senior staff
attorneys in hearing offices to issue fully favorable decisions in
cases that can be decided without a hearing (i.e. ``on the record'').
This eliminates many months in the wait for payment of benefits. We are
pleased that Commissioner Astrue decided to authorize the program for
at least the next two years.\3\ In FY 2009, senior attorneys decided
more than 36,300 cases, a 50% increase over FY 2008. This means that
more than 36,000 claimants were able to receive their disability
benefits months sooner.
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\3\ The program is extended through August 10, 2011. 74 Fed. Reg.
33327 (July 13, 2009).
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2. Findings Integrated Templates (FIT). FIT is used for ALJ
decisions and integrates the ALJ's findings of fact into the body of
the decision. While the FIT does not dictate the ultimate decision, it
requires the ALJ to follow a series of templates to support the
ultimate decision. Representatives can use the FIT template, which is
available on the SSA website, to draft proposed favorable decisions.
Many representatives are now using the template either when requested
by the ALJ or on their own initiative. When the draft proposed decision
is submitted to the ALJ, it can lead to a speedier decision.
3. Increase time for hearing notice. We recommend that SSA provide
advance notice of the hearing date 75 days prior to the hearing date
rather than the current 20 days. The 75-day time period has been in
effect in SSA's Region I states since August 2006 \4\ and, based on
reports from representatives, has worked well.
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\4\ 20 C.F.R. Sec. 405.315(a).
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Improvements at the Initial Levels
CSAVR supports initiatives to improve the process at the initial
levels so that the correct decision can be made at the earliest point
possible and unnecessary appeals can be avoided. Improvements at the
front end of the process can have a significant beneficial impact on
preventing the backlog and delays later in the appeals process.
1. New Screening Initiatives. CSAVR supports SSA's efforts to
accelerate decisions and develop new mechanisms for expedited
eligibility throughout the application and review process. We encourage
the use of ongoing screening as claimants obtain more documentation to
support their applications. However, SSA must work to ensure that there
is no negative inference when a claim is not selected by the screening
tool or allowed at that initial evaluation. There are two initiatives
that hold promise:
Quick Disability Determinations. CSAVR supports the
Quick Disability Determination (QDD) process, first begun in
SSA Region I states in August 2006 and expanded nationwide by
Commissioner Astrue in September 2007.\5\ The QDD process has
the potential of providing a prompt disability decision to
those claimants who are the most severely disabled. Since its
inception, the vast majority of QDD cases have been decided
favorably in less than 20 days, and sometimes in just a few
days.
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\5\ 20 C.F.R. Sec. Sec. 404.1619 and 416.1019.
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Compassionate Allowances. This initiative allows SSA
to create ``an extensive list of impairments that we [SSA] can
allow quickly with minimal objective medical evidence that is
based on clinical signs or laboratory findings or a combination
of both . . . .'' SSA has published an initial list of 50
conditions on its website, with more to be added at a later
date. Unlike the QDD screening, which occurs only when an
application is filed, screening for compassionate allowances
can occur at any level of the administrative appeals process.
SSA has held recent Compassionate Allowance outreach hearings
with expert panels to consider early onset Alzheimer's disease
and schizophrenia.
2. Improve development of evidence earlier in the process.
Claimants' representatives are often able to provide evidence that we
believe could have been obtained by the DDSs earlier in the process.
Our recommendations include:
Provide more assistance to claimants at the
application level. At the beginning of the process, SSA should
explain to the claimant what evidence is important and
necessary. SSA should also provide applicants with more help
completing the application, particularly in light of electronic
filings, so that all impairments and sources of information are
identified, including non-physician and other professional
sources.
DDSs need to obtain necessary and relevant evidence.
Representatives often are able to obtain better medical
information because they use letters and forms that ask
questions relevant to the disability determination process.
However, DDS forms usually ask for general medical information
(diagnoses, findings, etc.) without tailoring questions to the
Social Security disability standard. One way to address this
would be for SSA to encourage DDSs to send Medical Source
Statement forms to treating and examining doctors. These simple
forms translate complex, detailed medical source opinions into
practical functional terms useful to the vocational
professionals at DDSs and hearing offices.
Increase reimbursement rates for providers. To
improve provider response to requests for records, appropriate
reimbursement rates for medical records and reports need to be
established. Appropriate rates should also be paid for
consultative examinations and for medical experts.
Provide better explanations to medical providers. SSA
and DDSs should provide better explanations to all providers,
in particular to physician and non-physician treating sources,
about the disability standard and ask for evidence relevant to
the standard.
Provide more training and guidance to adjudicators.
Many reversals at the appeals levels are due to earlier
erroneous application of existing SSA policy. Additional
training should be provided on important evaluation rules such
as: weighing medical evidence, including treating source
opinions; the role of non-physician evidence; the evaluation of
mental impairments, pain, and other subjective symptoms; the
evaluation of childhood disability; and the use of the Social
Security Rulings.
Improve the quality of consultative examinations.
Steps should be taken to improve the quality of the
consultative examination (CE) process. There are far too many
reports of inappropriate referrals, short perfunctory
examinations, and examinations conducted in languages other
than the applicant's.
ADDITIONAL RECOMMENDATIONS
In addition to addressing the backlog and SSA's funding issues,
there are several other legislative proposals that the Subcommittee may
be considering this year.
Protecting claimants' privacy rights. We understand
that it can be cumbersome for SSA to obtain medical records, as
it is for claimants and their representatives, and that SSA is
exploring more efficient ways to secure the necessary evidence.
While we support ways to make this process more efficient, we
believe that claimants' privacy rights must be protected. We
will work with SSA to find a way to obtain, as efficiently as
possible, a claimant's authorization for release of medical
records to SSA, while protecting the individual's privacy
rights.
Extension of the fee demonstrations in the SSPA.
Access to experienced and qualified representatives through the
lengthy and complex application process is critically important
to claimants. To this end, we support allowing claimants to
enter into voluntary agreements with representatives for fee
withholding and direct payment procedures whether under Title
II or Title XVI. The Social Security Protection Act of 2004
established two demonstration projects that should be made
permanent because they have proven to be effective in
increasing claimants' access to effective representation: (1)
Extension of the Title II attorney fee withholding and direct
payment procedures to SSI claims; and (2) Allowing nonattorney
representatives to qualify for fee withholding and direct
payment, provided they meet certain requirements. Unless they
are extended or made permanent, the demonstrations will sunset
March 1, 2010.
Increase and indexing of the fee cap. Rep. John Lewis
has introduced H. R. 1093, which contains two provisions
regarding the current $5,300 fee agreement fee cap: (1)
Increase the current fee cap to $6,264.50 (which represents the
figure if it had been adjusted for inflation since the last
increase in 2002); and (2) Index the fee cap for future years
to the annual COLA. We support these changes since they ensure
that there will be a knowledgeable, experienced pool of
representatives available to represent claimants.
Work incentives. The Ticket to Work and Work
Incentives Improvement Act was enacted nearly ten years ago and
is overdue for evaluation of its effectiveness in employment of
those receiving Title II and SSI disability benefits. We urge
renewal and permanent extension of expired/expiring provisions
including (1) SSA's Title II demonstration authority to test
promising approaches for work incentives and related
provisions; (2) Demonstration to Maintain Independence, set to
expire this year, to provide Medicaid buy-in coverage to
working individuals whose conditions or disabilities are not
yet severe enough to qualify them for disability benefits; (3)
Protection and Advocacy for Beneficiaries of Social Security to
protect the rights of beneficiaries as they attempt to return
to work; and (4) Work Incentives Planning Assistance, which
provides state grants for outreach and education to individuals
with disabilities about supports and services regarding
employment. However, it is critical that future efforts be
devoted to permanently extending and strengthening these
important return to work supports.
Statement of Eunmi Choi
Eunmi Choi
PAD 5106 PUBLIC ORGANIZATIONS
Nevin Smith
December 2, 2009
THE REQUIREMENT TO IMPLEMENT THE PUBLIC OPTION:
New Network and New Organization as an administrator,
NEGOTIATOR AND CONSULTANT
The introduction of the public option where public sector could
compete with private sector for selling health care insurances at the
same market will need the well-structured network system as a major
variable. The current situation in the United States is the worst
health care system operated by the principle of market competition
admitted as ideal type in everywhere. In other words, the optional
insurance purchasing depending on one's own ability eventually causes
the asymmetric structures of health care system and the national
problems beyond the expected efficiency of market competition. At this
point, the public option could be a watershed for health insurance
reform, only if the health care network system execute adequately and
fairly across each sector among public, private, and non-for-profit
organizations. To implement the public option, there are several
requirements the nation might need. Therefore, I am going to state
about the current health care system in the United States and the ideal
configuration of the network system with a new organization where the
public option might be implemented.
HEALTH CARE SYSTEM
Part 1. Government
Federal Government and state governments are involved in health
care plan through either way, even though the government cannot cover
all population in the United States. On the one hand, ``Medicare'' is
regarded as a federal program with no insurance companies under Federal
Government, which covers most persons aged 65 or elder, certain people
on Social Security disability, and which is composed of a hospital
insurance plan and a supplementary medical insurance plan. However, it
is not limited by individual demand, but a single-payer system as an
entitlement program. Firstly, Medicare hospital insurance (called Part
A) assists patients in covering cost in-hospital, post-hospital nursing
home care, and home care, and it is subsidized by Social Security
payroll taxes. Secondly, Medicare medical insurance (called Part B)
supplements welfare providing diagnostic laboratory costs, physical
therapy, and surgeon service; moreover, it is associated with the
hospital insurance plan. Thirdly, Medicare prescription drug coverage
(called Part D) supports the costs of prescription medications in a
bit.
On the other hand, ``Medicaid'' is also a federal program, but it
is administered by state government with different rules, which is for
low-income and vulnerable people with children, under age 65, as well
as over who already tired out their Medicare benefits. This Medicaid
program provides fundamental medical services--e.g. hospital, nursing
facility and home health care, and physical remedy Medicare does not
cover, as well as family planning, preventive care, outpatient
prescription drug, and eyeglasses. For instance, each state has a
protection and advocacy agency funded from the Federal Center for
Mental Health Services. The agencies have to provide the protections
for mental illness people and conduct the investigations in order to
care for them.
The Medicare and Medicaid program are supported by Federal
Government and state governments providing premiums, deductibles and
share of costs. In addition, their finance is appropriated by general
tax structure. While Federal Government is responsible of the general
provision of health care plans, state governments support more specific
services that are not covered by Federal Government.
Part 2. Non-for-profit
As contracting out or privatization, the entire organization in
non-for-profit sector is associated with linkage partners either
directly or indirectly. As third-sector closely interrelated with
governments or private sector, non-for-profit organizations play a
major role to provide health care services, to allocate health plans
through networks, and to provide multiple services that are fairly
different among the organizations. Their funds are derived from
federal, state, and county governments and they also reinvest their
earnings in to their infrastructure. In other words, their pure premium
is supposed to invest on actual health care services, not
administrative costs. Through federal regulations, managerial
responsibility and administration are transferred from the governments
to non-for-profit organizations in order to improve health care
services. For instance, the Health Care Financing Administration (HCFA)
as the one of the state agencies in Kansas State rendered the
administrative responsibility, case management, to nonprofit Area
Agencies on Aging. Non-for-profit aims at reduce state payroll expenses
and shrink the size of the state Medicaid bureaucracy. In addition, it
is required to change clientele type, the volume of cases, and the
urgency of care for those clients (Barbara S. Romzek and Jocelyn M.
Johnston, 1999, p. 112)
Non-for-profit organizations usually subcontracted with federal
program under the governments to provide upgraded services, trustworthy
services, and lower-price services unlike Medicaid program; on the
other side, they in practice provide more beneficial services and build
safer health care network than for-profit agencies do.
Part 3. For-profit
Health care in for-profit sector is usually operated by one or two
monopolistic mechanism rather than competitive mechanism. Almost
private companies such as insurance agencies, private hospital, medical
laboratory, pharmacy and so forth intend to focus on their benefit and
profit of them in that they are designed with a variety of ways and for
distinctive purposes. However, some quality of health plans by for-
profit organizations tends to against high costs, which is far from
ideal market in terms of laissez-faire. Moreover, their policy inclined
to vary depending on customers (divided into age, sex, and health
status). According to Organizing the Health Insurance Market (1992),
Peter Diamond indicates common pattern of health insurance companies.
One is a variety of insurance premiums for people in different
categories, with a wide range of premiums. Second is the underwriting,
which is the technical term for screening applicants in order to
determine risk class and acceptability, including the possibility of
refusing to sell to individuals because they are not viewed as
profitable given the risk classification and rates used. Third, in some
state, there is a government organized residual pool, without
underwriting so that everyone in that state can buy some coverage.
These phenomena lead uninsured people and unfair tradeoff.
Health plans through for-profit sector can be selected by certain
customers who do not choose the public sector or non-for-profit sector,
and then they usually expect the different policy and the more
qualified services compared to prices. Therefore, for-profit sector can
be operating through premium and marginal benefit, especially market
incentives relied on their profit.
THE GOAL OF THE PUBLIC OPTION
The public option mentioned below is based on President Barack
Obama's Health Care Speech to Congress on September 12, 2009.
The public option as per choice and competition will provide more
realistic security and stability to those who have health insurance and
to those who do not have yet. The public option will reduce the growth
of health care costs for the families, businesses, and governments and
then it gives responsibility to the government and insurance companies,
as well as employers and individuals, which is related to multiple-
payer environment.
First, nothing in this plan will require changing the coverage, if
one already has health insurance through job, Medicare, Medicaid, or
individual acquisition. Rather, this plan will make better health care
condition; for example, insurance companies cannot drop the coverage
any more whatsoever having severe illness. It means there will be no
more arbitrary cap of coverage. Besides, insurance companies will have
to serve preventive care and routine checkups. All in all this plan
will lead saving money and lives in terms of more security and
stability.
Second, this plan will guarantee affordable and qualified insurance
to everyone, if one has not health insurance, if lose one's job or
change, or if have small business. For this plan, a new insurance
exchange will be established for individuals and small businesses to
purchase health insurance at competitive prices. In case of disability
to afford the low-priced insurance, tax credits based on one's need
will be provided. Therefore, insurance companies will be in the
participation of the new insurance exchange having an incentive that
can recruit millions of new customers. Based on second plan,
improvement of health care system can work only if everyone has health
insurance either way.
In sum, three outlines are followed: (1) consumer protections with
insurance, (2) an exchange where purchasing affordable coverage by
individuals and small businesses, and (3) an obligation for affordable
people to buy insurance.
TODAY'S PROBLEM
Those who live in threatened bankruptcy are extraordinary hardships
to have health insurance. They are not welfare people, but middle-class
Americans. Most of them cannot afford high costs that are three times
if one is self-employed rather than employer. Or, in spite of the fact
that there are persons who are able or willing to pay, they are often
denied to purchase insurance because of high risky to cover. While some
purchase health insurance from public or non-for-profit sector, others
obtain from private sector. However, it leads a number of problems such
as low quality services, insufficient services, high price insurance,
and so forth.
As a rising costs problem in the United States, insurance premium
is almost three times than wages. The reason is that small businesses
require for their employees to pay high premium or give up the entire
coverage. Moreover, hidden tax due in part to uninsured people causes
the rising costs in emergency room or charitable care.
These health care systems of nowadays mentioned above give
disabilities deprivation and taxpayers tremendous burden. These
problems cause greater costs to Medicate and Medicaid programs in terms
of the red operation due in part to increased needs. Furthermore, there
exist contradictory opinions. On the left, they argue that a single-
payer system that acutely separates the private insurance market and
the government provision to the whole like Canada's is the solution. On
the right, they insist that the employer-based system should be quit
and then individuals should buy health insurance by themselves.
IDEAL NETWORK AMONG PUBLIC, PRIVATE, AND NON-FOR-PROFIT SECTOR
For the public option, the new network is required to combine
public, private, and non-for-profit sector with a new organization.
This is because the size of health care system will be enlarged more
than ever. The public option will be based on customers' choice and
agencies' competition at the market. Public sector for the whole
customer, private sector for qualified service, and non-for-profit
sector for fairer trade should be established under the new network.
Besides, goal consensus, efficient service delivery, and professional
association through the adaptable policy are needed to implement the
public option.
First of all, the public option is to guarantee beneficiaries to
keep security and stability. This goal can affect all sectors and then
the organizations in public, private, and non-for-profit sector have to
remind of it, not focus more on their lucrative results or marginal
costs. While the governments are to merely provide subsidies from
general taxation into Medicare and Medicaid programs and to contract
with non-for-profit organization, companies in private are to only seek
profits regardless of social equity so far. The result could lead
serious national problems like the gap between wealth and poverty. When
all of the organizations reach the same consensus, the goal of the
public option will be enhanced. The policy among all sectors needs to
include the definition of the goal, even though they compete with each
other at the same market.
Second, the network of public, private, and non-for-profit sector
is required interrelating for efficient service delivery, not merely
delivery focused on health care expenditure. This is because public
sector will hire partial employees from private sector in order to
implement the public option. On the public side, the governments do not
provide direct service, but support the overall programs; non-for-
profit organizations contracted with the government intend to provide
specific service than the governments. On the other side, private
agencies can supply the best service to only limited customers who pay
high costs or are healthier with no serious problems. At this point,
incentive depending on each sector's characteristic will be a versatile
solution in the new network. As a technical assistance incentive--e.g.
intensive-service unit, concerted programs or education and advice-
monitoring, non-for-profit organizations can supply the improved
service to customers who prefer the non-for-profit sector to others. As
a participatory incentive in the new insurance exchange, private
organizations can attract new customers in terms of their capacity, and
public organizations also can be motivated in competition with private
organizations. These incentives will affect to policymaker among the
organizations.
Finally, professional association related to all sectors will make
the network as the whole. It means that through the new network,
professional association can share the value of providers and the
intention toward buyers, which will be able to build stronger
relationship among them. It leads the similar tasks or reproductions in
the new network as institutional isomorphism or internal structural
similarities. Furthermore, they can negotiate to implement the public
option with a kind of guidelines from professional association and then
understand the reason of the implementation of the public option. As a
result, professional association will be able to avoid disparity of the
health care system
FOR THE PUBLIC OPTION, THE NEW ORGANIZATION AS AN ADMINISTRATIOR,
NEGOTIATOR, AND CONSULTANT
The new organization will aim to cover full-scale, which limits
exclusion of customers who cannot afford or already have health
problems, which stimulates low quality services to improve and which
controls exorbitant prices at health insurance, hospital, doctor, and
etc. The new organization with new national programs is to execute
health care reform, cover young adults, protect retiree health
benefits, and generate a new federal grant for implementation of the
public option.
At health insurance exchange derived from health care reform, the
new insurance market will be open to individuals and employers to
purchase health insurance by their choice from the competition among
public, private non-for-profit sector, even new health insurance
cooperatives (co-ops). The new organization for the implementing public
option will have to keep an eye on the health insurance exchange
whether to be transparent or equitable to every participant. If
necessary, the negotiation related to the prices would be required
within all sectors. It does not mean of price-fixing or the formation
of Cartel. All of agencies in public and private, even non-for-profit
sector will appear their own policy to new customers. Moreover, these
operations will be self-supporting by their profit and premium like
present-day insurance agencies. In health care system, the methods of
funding originate in direct payments, general tax payments and
subsidies or donations. This is where the new organization will control
the policy including the range of customers and the prices of health
insurance in order to implement the public option appropriately.
In addition, the new organization will be able to put pressure on
the new network of public, private, and non-for-profit sector in order
to make them to have their responsibility, as well as every individual
and every employer having either small or big business. Again, public
sector will have all-inclusive responsibility to implement the public
option by encouraging high quality including the improvement of
Medicare and Medicaid programs. Especially, state governments can
decide on opt-in or opt-out system.i Either way, they cannot
avoid their accountability to provide health services and products.
Private sector will conduct more fairly under the public option.
Because for-profit agencies will have to compete with public sector,
their monopoly will turn into reasonable trade market.
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\i\ While opt-in system is that state governments can produce a
public plan or vice-versa, opt-out system the state governments have to
set up a public option, however, they can stop providing the public
plan.
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What is more important thing is the new organization will blur the
service boundary of public, private and non-for-profit sector if
various health programs are gave the sector, respectively. This
organization will be toward better health care system. It means that
the same direction to new health care system can bring a successful
result of supply-driven services away from obviously separated sectors,
as if the one organization encourages providing qualified health
service and as if the clearly separated sectors are the divided
divisions within the one organization. It also means that the new
organization will not impose the same rules and ways to deliver health
services, but induce the same enthusiasm for better health care system
in terms of the public option. On the other side, each individual or
employer will purchase the health insurance through the new network.
They will also need some advice to figure out which will be suitable to
their own conditions. This is where the new organization will be
applied as a consultant, which means the new organization should not
merely determine the certain health insurance to the certain customer,
but support to decide the proper health insurance with much
information.
Finally, in the new network with the new organization, insurance
purchasing will be operated by customized health care in that all
sectors are interrelated under the new organization as well as every
individual and employer receive the guidelines or suggestions from the
new organization. This new network will be within the market where
public, private and non-for-profit sector will compete together, which
leads the insurance industry.
[GRAPHIC] [TIFF OMITTED] T3016A.113
Figure 1. The ideal network with the new organization: the new
organization in the new network can control overall sectors to
successfully implement the public option. As the provider, public,
private and non-for-profit sector will serve various health programs
and health insurance at the same market; as the buyer, each individual
and self-employed will be able to purchase health insurance depending
on their ability and give health care programs at the market.
CONCLUSION
To rebuild health care system, trust from customers and conscience
among each organization as organization-to-organization perspective are
important. The public health care option announced by the president
Barack Obama would deserve everyone in the United States. All of the
programs related to health care are performed by the Federal Government
and state government, for-profit organizations, and non-for-profit
organizations respectively. As a result, it brings national problems
and gives the realization to improve overall health care system. For
successful implementation of the public option, the new organization
that is not involved in public, private, or non-for-profit sector, but
one of the administrators, negotiators and consultants could be
required. If the ideal model I mentioned the new network with the new
organization is possible, I would expect that every customer in the
United States will have their own health insurance without any fear of
contemporary health care system, as the nation tends to encourage the
public option in spite of critical opposition that it is merely
extended Medicare plan, and that if any policies implemented at
national level should be accepted, it would acknowledge the big
government leads the increased tax revenues and thereby it would
restrict individual decision whether to purchase health insurance or
not.
To sum up, it is necessary to concern about the new network or the
new organization to alternate the original system. The entire network
system can be changed by the radical purpose or the social demands.
Therefore, well-constructed network system can improve the overall
efficiency, quality and acceptability.
REFERENCES
Diamond, P. (1992). Organizing the Health Insurance Market.
Econometrica, 60(6), 1233-1254.
Lee, S. D., Alexander, J. A., & Bazzoli, G. J. (2003). Whom Do They
Serve?: Community Responsiveness among Hospitals Affiliated
with Health Systems and Networks. Medical Care, 41(1), 165-179.
Provan, K. G., & Milward, B. H. (1991). Institutional-Level Norms and
Organizational Involvement in a Service-Implementation. Journal
of Public Administration Research and Theory, 1(4), 391-417.
Romzek, B. S., & Johnston, J. M. (1999). Reforming Medicaid through
Contracting: The Nexus of Implementation and Organizational
Culture. Journal of Public Administration Research and Theory,
9(1), 107-139.
Schneiberg, M. (2005). Combining New Institutionalisms: Explaining
Institutional Change in American Property. Sociological Forum,
20(1), 93-137.
Florida--State Resource Guide. (n.d.). Retrieved November 28, 2009,
from http://mentalhealth.about.com/cs/localandregional/a/
florida.htm.
Medicare and Medicaid: What's the Difference? (2005). Retrieved
November 28, 2009, from http://www.nolo.com/legal-encyclopedia/
article-29615.html.
Medicaid: A Program Overview. (2000, September). Retrieved November 28,
2009, from http://www.policyalmanac.org/health/archive/
hhs_medicaid.shtml.
The Value of Nonprofit Health Care. (n.d.). Retrieved November 27,
2009, from http://www.nonprofithealthcare.org/reports/
5_value.pdf.
White, J. (2007). Markets and Medical Care: The United States, 1993-
2005. The Milbank Quarterly, 85(3), 395-448.
Statement of Ibrahim Dere
A healthcare system network design proposal for the U.S.:
``No uninsured left behind''
Ibrahim Dere PAD 5106--Public Organizations, Fall Semester
Instructor Nevin Smith
December 2, 2009
1. INTRODUCTION
The healthcare system reform in the U.S. has been a hot topic from
beginning of the 2008 presidential election campaign. The president
Barrack Obama has promised to passed comprehensive health reform in
order to control rising health care costs, guarantee choice of doctor,
and assure high-quality, affordable health care for all Americans (The
White House, retrieved on 11/25/2009 from http://www.whitehouse.gov/
issues/health-care).
In this paper, I will try to design a healthcare system network in
which the public organizations will actively participate in both policy
regulation level and provision level in the healthcare industry and
running by a public, private, and not for profit organizations
collaboration.
2. THE CONCEPTUAL FRAMEWORK
a. The necessity of public-private-NPO partnership
They are well known facts that, about 16% of the entire population
has no health insurance in the U.S. (retrieved on 11/25/2009 from
http://www.gallup.com/poll/121820/one-six-adults-without-health-
insurance.aspx) and healthcare is more expensive than many
industrialized country. The reform should also aim to reduce the
general level of price in health industry. Unavailability of the
healthcare or accessing to the healthcare with unreasonable prices has
some disadvantages for not only for individuals but also for the entire
society.
Public option is a type of service provision of not only
healthcare, but also other public services, such as education, national
security, etc. Public service production and/or provision is generally
done by a collaboration of the governmental, for profit, and not profit
organizations. Of course, like any goods and service, in healthcare
issue, whole service can be served or ant necessary goods, such as
medicine, drug, prosthesis, etc. can be provided by the government by
health professionals who are working for government in the health
institutions owned by the government. In this kind of provision option,
``public option'' would be regarded just as an ``ideal type'' or a
``pure type''. Max Weber suggest ``an ideal type is formed by the one
sided accentuation of one or more points of view'' according to which
``concrete individual phenomena . . . are arranged into a unified
analytical construct''; in its purely fictional nature, it is a
methodological ``utopia [that] cannot be found empirically anywhere in
reality.'' (Stanford Encyclopedia of Philosophy, Aug 24, 2007,
retrieved on 11/25/2009 from http://plato.stanford.edu/entries/weber/
#IdeTyp).
Even in the national security which has been regarded as the ``pure
public service,'' the ideal type does not exist. More or less private
or nongovernmental stakeholders involve in the service provision
process. No matter what kind of system will be implemented after the
healthcare reform bill passed, not only the uninsured who will utilize
the projected the system, but also under the insured individuals will
be affected the healthcare reform. Therefore, all of the stakeholders,
including private insurance companies, private health institutions,
pharmaceutical industry, and medical industry will be affected
positively or negatively. It is not an unexpected that such interest
groups will make effort to influence policy making process to maximize
their interest.
According to Bozeman's dimensional model, few complex organizations
are purely public or purely private. Instead, some mix of public and
private authority influences the behavior o f most organizations. If
publicness is independent o f the formal legal status o f the
organization, it is convenient t o think that some government
organizations are ``more public'' than others, that some business
organizations are ``more private'' than others, and that it is possible
for specific business organizations to be ``more public ``in some
respects than specific government organization. Chaordic system
thinking view emphasizes that systems flow or change naturally and
perceives work organizations as complex adaptive systems. They also
suggest that Chaordic system thinking perceives the member of an
organization (a unit of the healthcare system) as operating in both
horizontal (e.g. cross departmental) and vertical (e.g. cross-
hierarchical) heterarchical system aggregates in which more complex
structures and mental models may develop (Bozeman & Bretschneider,
1994).
According to William F. West, bureaucratic structures are means of
political control and political actors choose administrative
institutions that will perpetuate their interests in the future. He
also quotes from Terry Moe (1989 and 1990) has described the
relationship between interest groups and bureaucratic structure in a
more systematic way than traditional pluralist theory provides. Whereas
members of the general public (and even well-informed voters) know
little about the implications of administrative procedures and
organizational arrangements, groups are highly attentive to issues of
program design: Interest groups take an active part in the politics of
structural choice, and politicians have strong incentives to be
sensitive to their interests and demands (West, 1997).
b. The necessity of intergovernmental labor division
If we consider the facts that the U.S. is one of the most populous
and wealthiest nations in the world in terms of GDP and GDP per capita,
and private healthcare and health insurance system have been dominated
by the private entities/insurers throughout its history, the proposed
healthcare design should include the private (nongovernmental) parties,
more or less. Besides that the United States has a Federal Governmental
system and it has been strong local government tradition.
Amendment 10of the U.S. Constitution Ratified on 12/15/1791 states
that ``The powers not delegated to the United States by the
Constitution, nor prohibited by it to the States, are reserved to the
States respectively, or to the people.'' (Retrieved on 11/25/2009 from
http://www.house.gov/house/Constitution/Amend.html). The layers of
government: in the U.S. three layers of government with sovereignty of
their own (not a single government) provide public services, levy
taxes, and borrow money. Indeed, there are more than 86,000 governments
in the U.S., counting federal, state, and local entities (Frederickson,
1997). Additionally, private and nonprofit stakeholders the proposed
healthcare system will be a complex organizational network. The
proposed healthcare systems in which the government involved has been
illustrated as below in order to show how it will be complex by a
Republican Congressman, Kevin Brady, 8th District of Texas. (Retrieved
on 11/25/2009 from http://www.house.gov/apps/list/press/tx08_brady/
71509_hc_chart.html).
[GRAPHIC] [TIFF OMITTED] T3016A.114
Any complex organization is made up of a number of subsystems
[governmental layers], which in turn consist of sub-subsystems
[departmental sections of the governments]. The smallest system level
of any organization may be defined as the role performed by each
contributing member, with the system parts consisting of those aspects
of his personality required for role performance. These role-based sub-
systems should not be confused with organizational subdivisions, such
as hospitals, insurers, physicians, or individuals (Lyden, 1975).
c. The necessity of governance and networking
[Public service] [p]rovision means government intervention to
ensure availability or, generally, to finance the service; it does not
require production by the government.'' (Mikesell, 2007). Where
traditional public administration emphasizes the internal dynamics of
public agencies, the newer forms of action often involve elaborate
partnership arrangements with nongovernmental actors (Salamon, 1989).
Frederickson defines the governance as a wide range of types of
organizations and institutions that are linked together and engaged in
public activities and the patterns of interaction of multiple-
organizational systems or network (Frederickson, 1997). Newer tools [in
public administration] share a significant common feature: they are
highly indirect they rely heavily on wide assortment ``third
parties''-- . . . private hospitals . . . , to deliver publicly
financed services and pursue publicly authorized purposes. The upshot
is an elaborate system of third-party government in which crucial
elements of public authority are shared with a host of non-governmental
or other governmental actors. . . . In a sense, the ``public
administration problem'' has leaped beyond the borders of the public
agency and now embraces a wide assortment of ``third parties'' that are
intimately involved in the implementation, and often the management, of
the public's business. . . . many countries in western Europe have non-
profit sectors quite a bit larger than that in the U.S., financed
largely through grants and contracts from the state. In shifting the
focus in public problem solving from agencies and programs to generic
tools, the new governance also shifts the attention from hierarchic
agencies to organizational networks. The defining characteristics of
many of the most widely used, and most rapidly expanding, tools is
their indirect character, their establishment of interdependencies
between public agencies and a host of third-party actors. As a result,
government gains important allies, but loses the ability to exert
complete control over the operation of its own programs, instead of
sharp division between the public and private spheres, [the new
government tools] blend the two together (Salamon, 2002). In public
private partnerships, contracts replace hierarchy. Instead of chain of
authority from policy to product, there is a negotiated document that
separates policymaker from policy output. (Donald F. Kettl, p 21).
In most industries, routines, programs, goals, public accounts, and
structures are subject to both competitive and institutional isomorphic
pressures. Such pressures presumably dampen such behavioral
consequences of legal form as might otherwise exist. Competition among
for profit and nonprofit healthcare providers, for example, is said to
make the latter more socially responsible and the former more efficient
than they would otherwise be. Hollingsworth & Hollingsworth report
declining differences on a range of structural and performance
variables of nonprofit, for profit, and public hospitals between 1935
and 1979. Thus form-related differences might emerge more strongly in
comparisons among industries with differing compositions in one
society, or between the same industries in different places (DiMaggio &
Anheiner, 1990). Kessler & McClellan suggest that areas with a presence
offer-profit hospitals have approximately 2.4% lower levels of hospital
expenditures, but virtually the same patient health outcomes. They
conclude that for-profit hospitals have important spillover benefits
for medical productivity. (Kessler & McClellan, 2002).
La Porte suggests that modern organizational life is characterized
increasingly by a growing number of intra-, inter-, and trans-
organizational relationships. These phenomena are signaled by terms for
(i) structure, such as complex systems, coalitions, various forms of
federalism, for example, marble cake federalism, communication nets,
and allusion to the computer/electric circuitry metaphor, (i.e., as
networks); (ii) characteristics of component relationships, such as
inter-dependence, tight (or loose) coupling, multiple horizontal or
vertical relationships between elements/members of a network; and (iii)
dynamics or process, such as bargaining, action, or information flows,
and resource exchanges between net members. He adds that the metaphor
of networks advances the descriptive discussion at least one useful
step toward more specificity in characterizing the webs, interconnected
systems, and interdependencies of modern public organization. He
continues that the network metaphor connotes relationships, between net
members, that are cooperative, and to a significant degree self-
reenforcing. The networks are likely to be large, spread over wide
geographies. Salient descriptive characteristics would include (i) the
scale and general structure of the net, (ii) the properties of its ties
or connectivity, (iii) the patterns of exchanges among net members, and
(iv) the problem more salient in public networks than in private,
economic one (La Porte, 1996).
Lee, Alexander, and Bazzoli suggest that health institutions which
are affiliated with health systems and more diversified systems or
networks (legally integrated or connected with a loosely and
voluntarily network) tended to be more responsive to the communal needs
compared to freestanding communal hospitals (Lee, Alexander, and
Bazzoli, 2003). It can be argued that scale economics and high level of
diversity in a network enhance the skills and resource for the health
institutions.
d. Necessity of a self adaptive system
Kira and Eijnatten suggest that, in order to promote work-
organizational sustainability, they consider organizations as chaordic
open systems and propose to extend the foundations of socio technical
system (purposefully designed and controlled to generate services or
products) from operational ST to chaordic ST chaordic system thinking.
At the work-organizational level, sustainability means an ability to
find ways to deal with challenges and capability to create new
opportunities for a productive existence (Kira & Eijnatten, 2008).
3. NETWORK DESIGN PROPOSAL
I propose a public health insurance model that both governmental,
for profit and non for profit organizations are acting their roles
within a harmony to sustain the healthcare system which has been one
the most complex industries in the U.S.
The health insurance system is an inseparable part of the
healthcare system in the U.S. In my model. every citizen, including
legal residents must have at least one full coverage health insurance
policy (primary policy). In addition to the existing private insurance
companies, the Federal Government will create a publicly-owned
insurance company which will be the last resort for obtaining a health
insurance and the first source for the public employees. Individuals
may purchase the policy either from private insurers or governmental
health insurance company individually. Employers must purchase health
insurance policy for their employees from either from private insurers
or governmental health insurance policy. In this case, the half-cost of
the primary policy will be charged to the employee. Employee's part
will be retained/checked off from the employees' salaries and
transferred to the insurer on behalf of the employee. Primary insurance
policy will cover the employee's spouse--if the spouse is not working-,
children under 18 years old. For each extra family member, the
employee's part will increase slightly. Public employers will purchase
the health insurance policy from the governmental health insurance
company. Self employers will be subject to the rules which are applied
to the employees. The employers cannot hire a part time employee who
has no health insurance. Partial amount of the policy will be paid to
the employee. Governmental insurance will cover all of the medical
expenses including, medicine, eye care, dental plan. Aesthetics
procedures will be out the policy unless there is medical necessity and
will be paid by the patients. Governmental insurance policy will be
purchased by the government for unemployed people or people who has no
income or fortune. Federal Government will create a fund in order to
subsidize the governmental health insurance company. By subsidization
of the governmental health insurance for destitute individuals, the
government will apply redistributive policy by transferring fiscal
resources from one class or group to another (Lowi, 1972).
The governmental health insurance company will collect its premium
revenues just like the tax revenues and nonpayment of the governmental
health insurance premiums will be evaluated like tax offense.
None of the medical service or treatment will be provided free or
co-pay free by the government. If the patients has no salary to pay for
the co-pay, this amounts will be met by the government. Even in this
case, the patients will pay a ``symbolic price, i.e. $1'' for each
service as co-pay. The government will pay the insurance expenses
instead of the medical expenses to the medical institutions.
The healthcare service will be a federal issue. But the Federal
Government will not be the healthcare service provider. It will be
responsible for supervising the governmental health insurance company,
organizing and supervising the healthcare system. The Federal
Government will set the tariffs as price cap for each medical
examination and medical supplies which will be applied by the
governmental health insurance company to make payment to the health
institutions. While this tariff will not be binding for private health
insurance companies, private hospitals, and drug companies, it will be
used in order to prevent the application exorbitant price policy for
private entities. In other words, the government will not set the price
of the services or medical materials, but it will limit to the
governmental health insurance company for the payment of each payment.
By doing this the government will apply a regulative policy to set
standards in terms of price (Lowi, 1972). All of the stakeholders, such
as representatives of consumers' organizations, pharmaceutical
industry, private hospitals, and insurance companies, will participate
in the regulatory process in accordance with the governance.
The laws, rules, and regulations flexible as much as possible in
order to cerate a well adaptive system to meet the requirement of new
unpredictable circumstances.
The public health institutions will be classified as three or four
categories. ``The first category health institutions'' will take care
of the basic health problems for instance tonsillitis etc. The second
one will take care of more complex health problems that are not solved
in the first step. Finally, at the third step, complex problems that
are not solved health problems will be taken care of. Except for
military institutions, the first and second category public health
institutions will be transferred to the local governments, and the
third category health institutions will be under the responsibility of
the states. These facilities will be funded by the governmental health
insurance company. If these institutions accept patients who hold
private insurance policy, the co-pay's will be transferred by the
institution and the private insurers' part will be transferred to the
governmental insurance company by the private insurers.
Healthcare system providers will consist of governmental, private,
and nonprofit organizations. Private health insurance holders will keep
going to the private institutions. The governmental health insurance
holders will have three options:
1- They will have option to go to the public health
institutions by paying reasonable co-pay.
2- They will have option to go to the nonprofit health
institutions by paying co-pay, if the institution applies.
3- They will have option to go to the private health
institutions by paying co-pay. But in this case co-pay will not
be fewer than the amount that public institutions apply.
Private health institutions will must charge and collect the
co-pay from the patients who hold the public health insurance
policy.
The existing programs Medicare, Medicaid, the Children's Health
Insurance Program and the Veterans Health Administration will be merged
in the governmental health insurance program. Wealthy senior citizen
will have to purchase their own health insurance. (Richard Epstein,
retrieved on 11/25/2009 from http://healthaffairs.org/blog/2008/03/13/
health-care-disparities-deregulation-first-redistribution-last/).
Every individual will have a medical record which is kept in a
federal institution and every transaction will be recorded within the
account. (Medical record privacy misuse will be a federal offense to
protect privacy.) Every insurer, including the governmental company
will notify each member's personal information, especially whether or
not he or she has a valid policy. Frictional uninsured interims will be
covered by the governmental health insurance company.
The government (federal, state, and local) or governmental health
insurance company will not produce or sell drugs or medical supplies.
They will pay the governmental insurance policy holders medical
expenses to the private providers such as private hospitals,
pharmacies, medical supplies sellers, etc. Public health insurer,
having a huge negotiation power, may obtain the medication form the
drug companies from cheaper prices.
In case of epidemic or pandemic, which is declared by the Federal
Governmental nationwide or in partial in the country, urgent and/or
compulsory health expenses for every citizen will be paid by the
governmental health insurance company regardless of valid policy.
[GRAPHIC] [TIFF OMITTED] T3016A.115
4. CONCLUSION
As a conclusion, I propose a public option model which will coexist
private health insurance companies, private health institutions,
private pharmaceutical companies, and nonprofit health institutions
together with the public entities that are functioning at regulatory
and/or street level. This model will be a public umbrella that provides
a full coverage health insurance both to uninsured individuals together
with people who utilizing the existing public medical aid programs and
suffering from the unaffordable health insurance policies. Due to the
fact that, in the public option, private and not for profit
organizations will keep playing their important roles, governance will
be a key concept to cooperate all three sectors in order to sustain the
healthcare system. Instead of sharp division between the domains of
public, private, and not for profit, they will form a self evolving -as
much as possible- and complex structure. Redistribution will be another
key characteristic of the system due to the fact that enlarging public
interference/portion in the healthcare system will necessitate extra
fiscal resources and taxpayers will have to pay more. In order to built
up and pursue the good governance patterns, a well defined, well
functioned, comprehensive, and adaptable organizational and
technological networks should be created by beginning from the federal
level through to the bottom level and from the governmental domain to
the private and not for profit domains.
5. BIBLIOGRAPHY
Amendment 10of the U.S. Constitution Ratified on 12/15/1791 states
that (http://www.house.gov/house/Constitution/Amend.html).
Kettl, Donald F., The Transformation of Governance, Public
Administration for Twenty-First Century America, The Johns Hopkins
University Press, Baltimore, Maryland, 2002.
Bozeman, Barry & Bretschneider, Stuart, The ``Publicness Puzzle''
in Organization Theory: A Test of Alternative Explanations of
Differences between Public and Private Organizations, Journal of Public
Administration Research and Theory: J-PART, Vol. 4, No. 2 (Apr., 1994),
pp. 197-223.
DiMaggio, Paul J. & Anheier, Helmut K.,The Sociology of Nonprofit
Organizations and Sectors, Annual Review of Sociology, Vol. 16 (1990),
pp. 137-159.
Frederickson, H. George, The Spirit of Public Administration,
Jossey-Bass Publishers, San Francisco, 1997, 272 p.
Gallup Inc. (2009). Retrieved on 11/25/2009 http://www.gallup.com/
poll/121820/one-six-adults-without-health-insurance.aspx.
Kessler, Daniel P. & McClellan, Mark B., The Effects of Hospital
Ownership on Medical Productivity, The RAND Journal of Economics, Vol.
33, No. 3 (Autumn, 2002), pp. 488-506.
Kira, Mari & van Eijnatten, Frans m., Socially Sustainable Work
Organization: A Chaordic System Approach, System Research and
Behavioral Science, (2008) 25, 473-756.
La Porte, Todd R., Shifting Vantage and Conceptual Puzzles in
Understanding Public Organization Networks, Journal of Public
Administration Research and Theory: J-PART, Vol. 6, No. 1 (Jan., 1996),
pp. 49-74.
Lee, Shoou-Yih D., Alexander, Jeffrey A., Bazzoli, Gloria J., Whom
Do They Serve?: Community Responsiveness among Hospitals Affiliated
with Health Systems and Networks, Medical Care, Vol. 41, No. 1 (Jan.,
2003), pp. 165-179.
Lowi, Theodore J., Four Systems of Policy, Politics, and Choice,
Public Administration Review, Vol. 32, No. 4 (Jul.--Aug., 1972), pp.
298-310.
Lyden, Fremont James Lyden, Using Parsons' Functional Analysis in
the Study of Public Organizations, Administrative Science Quarterly,
Vol. 20, No. 1 (Mar., 1975), pp. 59-70.
Mikesell, John, Fiscal Administration: Analysis and Applications
for the Public Sector, 7th Edition, by Thomson Wadsworth, 2007, 707 p.
Salamon, Lester M., Beyond Privatization: the Tools of Government
Action, Washington D.C.: Urban Institute Press, 1989.
Salamon, Lester M., The Tools of Government A Guide to New
Governance, Action, Governance and the Tools of Public Action, Oxford
University Press, 2002.
Stanford Encyclopedia of Philosophy, (2007), Retrieved on 11/25/
2009 from http://plato.stanford.edu/entries/weber/#IdeTyp.
West, William F., Searching for a Theory of Bureaucratic Structure,
Journal of Public Administration Research and Theory: J-PART, Vol. 7,
No. 4 (Oct., 1997), pp. 591-613.
The White House, The, retrieved on 11/25/2009 from http://
www.whitehouse.gov/issues/health-care.
Statement of James F. Allsup, President, CEO and Founder of Allsup
Chairman Tanner and Members of the Subcommittee, thank you for
considering my written testimony today regarding the Social Security
Administration's challenges in managing the massive disability claim
backlog during the current economic downturn.
My name is James Allsup, and I am a former employee of the Social
Security Administration and the founder and CEO of Allsup Inc., the
largest non-attorney Social Security Disability Insurance (SSDI)
representation company. Since 1984, we have helped more than 120,000
individuals obtain disability benefits.
A Grave New Threat
Earlier this year, I provided written testimony before the full
Ways and Means Committee, commenting on an increasingly grave threat to
the SSDI system, and most importantly, to hundreds of thousands of
disabled individuals. Despite the best efforts of the Social Security
Administration and policymakers to address an exploding backlog of
claims at the hearing level, the highest unemployment levels in 25
years were causing desperate Americans to flood the Social Security
Administration with disability claims at an unprecedented rate.
From 2004 through 2007, application levels were stable, with the
SSA processing between 2.1 million and 2.2 million SSDI applications
each year. Those numbers began increasing in 2008--when for the first
time more than 2.3 million applications were filed. They grew even more
dramatically, to more than 2.7 million, in the recently completed FY
2009.
It's amazing the difference one year can make. For years,
disability advocates have been working to raise awareness of the
massive backlog of claims at the hearing level. Congress and the
Administration should be commended for providing the resources needed
by the SSA to begin addressing that challenge. The men and women of the
SSA deserve praise for using those resources wisely to reduce the
number disability hearings pending for the first time since 1999.
Unfortunately, the current crush of applications will undo that
progress. The SSA recently reported that the level of initial claims
pending now exceeds 1 million people--that's nearly a 40 percent
increase over the level from FY 2008. It is quite clear that even as
the backlog improves at the hearing level, the line for benefits
continues to grow rapidly at the front end of the system.
If They Only Knew
The long wait for benefits imposes real costs to applicants,
according to a recent national claimant survey conducted by Allsup.
People with disabilities experience financial crises, extreme stress
and declining health while stuck in the federal disability backlog. An
overwhelming majority of SSDI applicants face grave setbacks and wish
they would have known from the start that expert representation was
available to assist them.
Arthur Blair, of Gaithersburg, MD., was a program manager at a
group home before a combination of osteoarthritis, severe back pain and
depression made it impossible for him to keep working. During his two-
year wait for SSDI benefits, Mr. Blair tapped deep into his savings and
had to sell his home after he and his wife were unable to make their
mortgage payments. His condition also worsened.
According to Mr. Blair: ``I think the process takes away our
humanity. There are no resources to help you. You are in a financially
devastating position, and by the time you're approved, you have
accumulated so much debt and lost everything you've worked for. It's
almost impossible to recuperate what you lost.''
Mr. Blair's experience is typical, according to Allsup's 2009
survey of SSDI claimants. Of the nearly 300 successful SSDI claimants
who came to Allsup for representation, 90 percent said they faced
negative repercussions while waiting for their SSDI award. These
included:
Stress on family--63 percent
Worsening illness--53 percent
Draining of retirement/savings--35 percent
Lost health insurance--24 percent
Missed mortgage payments--14 percent
Foreclosure--6 percent
Bankruptcy--5 percent
Nearly 80 percent of respondents reported facing ``barriers to
handling the SSDI process on [their] own,'' including problems with
understanding (48 percent) and completing (61 percent) the necessary
forms. Three-fourths (75 percent) said the level of stress they
experienced while applying for SSDI benefits was either ``extreme'' (39
percent) or ``significant'' (36 percent).
Only half (51 percent) of all applicants knew third-party
representatives could help them apply for SSDI benefits. Almost nine in
10 (85 percent) survey respondents said they would have found it useful
for the SSA to inform them in advance of their options for receiving
help with their SSDI application. Another 83 percent would have found
it helpful or valuable if the SSA had provided them with a list of
authorized third-party representatives from which to choose.
Unfortunately, because applicants often are unaware help is
available, too many initial claims are denied for reasons that have
nothing to do with the applicant's disability status. If applicants
only knew third-party assistance was available to professionally review
their application and help properly and accurately document their
disability, thousands of claimants could be processed faster and
applicants could avoid the painful financial and personal repercussions
of being stuck in the system.
Collaboration, Not Privatization
As always, I emphasize that increasing the assistance offered by
third-party SSDI representatives is not, as some have charged, a step
toward privatization. It is a way for government to leverage the
existing capabilities of expert disability representatives to help
address a real and growing crisis. It is very similar to the Internal
Revenue Service's acknowledgement of tax preparation professionals, who
provide valuable assistance to taxpayers in navigating a complex tax
system.
Literally hundreds of thousands of government worker-hours could be
saved if more applications processed by the Social Security
Administration were professionally documented before being submitted.
This would leave these employees free to accomplish their primary
mission--reviewing applicants, adjudicating appeals and administering
the SSDI process.
Chairman Tanner and Members of the Subcommittees, I commend you for
holding this hearing to raise awareness of these issues. Thank you
again for the opportunity to provide testimony. I look forward to
working with you to address this growing crisis.
Statement of Leri Harper
The Social Security Administration's approach to disability, past
and present, fails to address the problems and inadequacies of
processing claims via the state Disability Determination Services
(DDS), where there is ample evidence of regional differences in claims
processing. AFGE strongly believes that if problems with inconsistent
decisions at the initial claims level are addressed, appeals will
diminish. Disability claimants deserve consistent initial claims
decisions and payments as soon as possible in the claims process.
The concurrent disability process shows inexplicable variable
allowance rates depending on the state of residence. There is no
evidence to show that residents of some states are twice as susceptible
to become disabled as residents in other states. Obviously, different
state initial claims approval rates have more to do with the bifurcated
system than the health of residents of these states. Claimants are
entitled to consistent decisions regardless of their state of residence
or whether they are filing for Social Security or SSI disability
benefits. The SSA Office of Quality Performance (OQP) is tasked with
keeping track of nationwide consistency of disability claims, and their
own studies reveal the disability process shows inexplicable variable
allowance rates depending on the state of residence. For instance a
study for fiscal year 2009 revealed that if a claimant applies in New
Hampshire, they have nearly a 52% chance of being allowed at the
initial level. If a claimant applies in Tennessee, they have a 24%
chance of being allowed. These inequities have never been addressed,
and there is an inherent inconsistency between states in what is
supposed to be a national disability program with consistent program
standards.
http://ssahost.ba.ssa.gov/pmr/index.aspx.
Regional differences are apparent, with many southern states at the
low end of the spectrum for approving initial disability decisions;
while many east and west coast states are at the high end for initial
allowance determinations.
The SSA Office of Quality Performance is the enforcer of the
national disability claims standards, who are tasked to review initial
disability claims under the same nationwide rules. We reviewed the most
recent initial disability claim quality report from the Disability
Quality Branch (DQB) of the Office of Quality Performance.
Interestingly, no matter what state DDS is measured, the states'
quality performance is all rated at a quality level of 91.5% or above
in accuracy levels. All state DDS agencies are declared by OQP/DQB to
provide good quality decisions, no matter how divergent their allowance
or denial rate of initial claims. http://quality.ba.ad.ssa.gov/hq/
direports/qaper/pdf/itable1.pdf.
During the past two years, the Office of Quality Performance
decided to institute a change in the Disability Quality Review Branch
process to try and iron out differences in their own national review
process. In an attempt to resolve these inconsistencies, the Disability
Quality Branch of the Office of Quality Performance now requires their
employees to review cases from any state in the Union.
Prior to this change in policy, Disability Quality Review branch
employees were limited to reviewing cases only from their individual
regions, meaning that the same federal reviewing staff would
consistently review the same state DDS offices for whom they were
responsible. These regional Disability Quality Branches reinforced the
inequitable allowance rates time and again, which they recognized as a
problem that needed resolution.
Despite the Office of Quality Performance attempts to create a
national virtual national review process, where Disability Quality
Branch workers are called on to review cases from any state, we see no
significant change in the state DDS' divergent allowance rates, meaning
that the review program is ineffective. Even though we have a national
quality review component that is well aware of the discrepancy, they
have not been able to solve the problem, even with extensive hiring of
new examiners during the past two years.
We believe that policing the state DDS adjudication practices is a
lot like herding cats, with various policy inconsistencies, political
influences, and regional differences that have no place in a national
disability adjudication program.
Unfortunately, the chances for a claimant to be approved at the
initial level have a lot to do with where they live and their income
rather than the nature of their disability. That is inherent in the
system. Each state has different criteria for hiring Disability
Examiners. Each state provides them with different pay and benefit
packages. Some state DDS offices are unionized, while others are not.
Each state provides different training to their DDS employees. Employee
retention rates vary dramatically from state to state. In effect, there
are 50 different disability programs when there should be one.
There is no evidence to show that residents of some states are
twice as susceptible to become disabled as residents in other states.
Obviously, different state initial claims approval rates have more to
do with the bifurcated system than the health of residents in these
states. Claimants are entitled to consistent decisions regardless of
their state of residence or whether they are filing for Social Security
or SSI disability benefits.
According to the Government Accountability Office (GAO), a majority
of DDS' do not conduct long-term, comprehensive workforce planning,
which should include key strategies for recruiting, retaining, training
and otherwise developing a workforce capable of meeting long-term
goals. The State DDS agencies lack uniform minimum qualifications for
Disability Examiners and have high turnover rates for employees and do
not provide ongoing training for Disability Examiners. It is a key
problem that must be reconciled in order to reform the disability
system.
Although the State DDS system is fully subsidized by SSA, state
budgetary problems adversely affect the ability of SSA to provide
disability services. For example, California State DDS workers were
forced to accept weekly 8 hour furloughs due to the budget deficit
situation in the State. Michigan DDS workers along with other MI State
employees were furloughed due to State budget shortfalls even though
DDS worker salaries were also fully funded by SSA.
As many participants in the hearing testified, multiple state DDS
offices followed suit, furloughing employees that were supposed to be
earmarked for federal workloads, causing SSA to lose valuable initial
case processing time, and resulting in worsening the disability backlog
considerably.
Social Security Commissioner Astrue recently made a decision to
solve the initial case backlog by taking away work from states where
there are average to high allowance rates, and creating mega-DDS
offices in states where the allowance rates are lower. These states
include Oklahoma, Mississippi, Arkansas, and Virginia. The Commissioner
plans to reassign cases from states that supposedly need assistance.
Commissioner Astrue calls these ``Extended Service Teams'' and says ``.
. . they will be placed in States that have a history of high quality
and productivity and the capacity to hire and train significant numbers
of additional staff.''. However Mississippi has an initial disability
allowance rate of 26.6%, Arkansas 37.1%, Virginia 40.4%, and Oklahoma
38.6%.
Interestingly, we noticed the Commissioner decided to locate these
new centers in right-to-work states where union representation is
absent. This will result in getting the work done more cheaply, but we
think SSA will get a poorer quality of work and less well-documented
claims that will ultimately end up at the hearings level. This will
require the ODAR staff to obtain additional documentation and
consultative exams that will again build more case processing delays
into those claims.
While we are concerned with the loss of union jobs nationwide, we
are more concerned with consistency and fairness in the disability
determination process. We would like to point out that Commissioner
Astrue created this tier of mega-DDS offices ``under the radar''
without input from the congressional representatives whose states are
affected, and this may be of concern to those representatives.
AFGE predicts this backlog of disability claims will end up in
multiple appeals that will glut the ODAR system once again, Because
additional work will now be funneled to mega-DDS offices that have a
historically low allowance rates, we predict the numbers of appeals
will rise dramatically once the initial claims backlog is unclogged
with the proposed temporary, stop-gap measures. This is not the best
course of action for lasting change, consistency of decisions, and
smooth workflow.
We understand that everyone want to solve the problem of backlogged
disability cases, but piecemeal solutions will not work when the
underlying problem of consistency between the state DDS disability
adjudication practices versus the federal adjudication rules are not
addressed. The bifurcation of the disability program between Federal
and State workers is an anachronism dating to 1956 when the SSA
disability program was created by Congress. It is time to modernize and
create a unified, comprehensive Federal disability system. AFGE
recommends the federalization of the State Disability Determination
Services; keeping the jobs in the states but supplying these skilled
workers with federal jobs. At that point, national standards and
training can occur where SSA actually has control of their own process.
This will bring consistency to the initial claims decisions in the same
way that the Supplemental Security Income program (that was federalized
from the states in 1974) created a uniform system of benefits for low
income, blind, disabled and aged population.
AFGE believes the time to act is now to federalize DDS workers and
provide consistent oversight and training that will bring timely,
consistent nationwide decisions for the vulnerable disabled claimants
that we are committed to serve in an unbiased and equitable fashion.
Submitted by,
Leri Harper
Disability Examiner/Social Insurance Specialist
For AFGE Local 3937
Seattle, WA
Statement of the National Council of Social Security
Management Associations
I am the President of the National Council of Social Security
Management Associations (NCSSMA). I have been the District Manager of
the Social Security office in Newburgh, New York for eight years and
have worked for the Social Security Administration for 29 years. On
behalf of our membership I am pleased to have the opportunity to submit
this written statement for the record to the Committee.
NCSSMA is a membership organization of nearly 3,500 Social Security
Administration (SSA) managers and supervisors who provide leadership in
1,262 Field Offices and 35 Teleservice Centers throughout the country.
We are the front-line service providers for SSA in communities all over
the nation. We consider our top priority to be a strong and stable
Social Security Administration, one that delivers quality and prompt
community based service to the people we serve, your constituents.
We are certainly concerned about the tremendous challenges facing
the Social Security Administration. We wholeheartedly agree with
Commissioner Astrue's statement that it is a moral imperative that the
disability backlogs be eliminated. On a daily basis, employees in our
offices speak to thousands of individuals throughout the country who
are desperate to receive a decision on their claims for disability
benefits.
We are very appreciative of the support that the House Ways and
Means Social Security Subcommittee has provided to improve SSA's budget
situation. The additional funding SSA received in FY 2008 and FY 2009
has helped significantly to prevent workloads from spiraling out of
control and assisted with improving service to the deserving American
public. As an example, SSA has been able to provide additional
resources for our Teleservice Center (TSC) operations, and recently
announced the opening of a new TSC in Jackson, Tennessee, to assist in
reducing our National 800 Number Network busy rates. We are also
grateful for the Subcommittee's support for the President's proposed FY
2010 budget for SSA. If this budget is approved by Congress, it will
help SSA continue to make progress on the numerous workloads we are
challenged with, and maintain the momentum that was so difficult to
achieve.
As a result of inadequate budgets received over the past decade
through FY 2007, the number of staff in SSA Field Offices declined
significantly. In fact, SSA's staffing levels were, until just
recently, at the lowest levels since the SSI program started in 1974.
Because SSA workloads were growing during this period, customer waiting
times increased and call answering rates declined. With the more
adequate funding for SSA in FY 2008 and FY 2009 there have been
significant efforts to restore staffing levels to near where they were
in FY 2004, but they are still lower than in previous years. This
additional staff, along with the significant amounts of overtime we
have been authorized to work, have assisted greatly with addressing our
rapidly growing workloads and increased number of customers and
callers.
The following is a brief overview of the workload challenges that
are confronting Field Offices.
1. Additional Claims and Appeals. Field Offices are expected to
receive 1.04 million more retirement claims and 1.08 million more
disability claims in FY 2009 and FY 2010 above FY 2008 levels. In
addition to the higher volume of disability claims received by Field
Offices, as the DDSs and the Hearing Offices reduce their backlogs,
many more additional claims are being approved and must be adjudicated
to pay benefits due. The Hearing Offices' cases can require extensive
development and are particularly time consuming for Field Offices to
process.
2. Improving SSI Quality and Additional SSI Redeterminations.
According to a November 2009 OMB report, in FY 2009 SSA paid out
approximately $45.0 billion to SSI recipients. However, there was an
improper payment rate of $5.436 billion or nearly 12.1%, one of the
largest in the Federal Government. A November 2009 study by the SSA
Office of Inspector General stated that for the 5-year period ending in
FY 2008 SSA paid $204.5 billion to SSI recipients. Of that total, $16.6
billion was overpaid, representing 8.1% of outlays. Underpayments
during this same 5-year period totaled $3.4 billion or 1.7% of outlays.
Given the significant overall dollars involved in SSA's payments, even
the slightest errors in the overall process can result in millions of
dollars in improper payments.
The SSA Office of Inspector General stated that completing
additional SSI redeterminations will help to reduce this error rate
because SSA will identify these incorrectly paid dollars earlier. In FY
2010, Field Offices will work about 1.1 million more SSI
redeterminations than FY 2008. This is nearly a 100% increase in SSI
redeterminations. The staffs processing these cases are working at a
very high rate of production. In fact, SSA productivity increased by
3.17% in FY 2009. However, we are concerned that despite this increased
production, there is insufficient time to review the cases adequately
for accuracy. Improving the process means not only doing more SSI
redeterminations, but also having sufficient time to review the work
for accuracy.
3. Medical Continuing Disability Reviews. Field Offices are also
processing more medical Continuing Disability Reviews (CDRs). In FY
2008 SSA processed 235,000 medical CDR cases. In both FY 2009 and FY
2010, we are scheduled to process 329,000 cases. This increase in
processing medical CDRs will assist significantly with addressing
program integrity concerns. However, there is currently a backlog of
1.5 million medical CDRs pending processing. Accomplishing this medical
CDR backlog has the potential to save the American taxpayers
approximately $20 billion. Additional resources will be needed in Field
Offices and the DDSs to process medical CDRs and to ensure program
integrity.
4. Work Continuing Disability Reviews. Field Offices are also
making a concerted effort to address the volume of work CDRs that are
awaiting processing. Since April 2009, the number of pending work CDRs
in Field Offices has been reduced from about 66,000 cases to the
current 55,000 cases. During the same period, the number of ``over one
year old'' cases has been reduced from approximately 7,650 to under 700
cases. Reducing the number of pending work CDRs will help to minimize
the large overpayments often encountered on these cases.
5. Field Office Customers. Field Offices have worked diligently to
redirect resources to reduce the amount of time a claimant waits to see
an SSA interviewer. We are making significant progress despite our many
challenges. In October 2009 a claimant waited an average of 19 minutes,
as compared to 22.8 minutes a year earlier. This is a significant
accomplishment considering the fact that the number of customers
visiting SSA Field Offices continues to increase. In FY 2009, there
were over 45 million customers, an increase of 600,000 customers from
FY 2008.
6. Field Office Telephone Calls. Field Offices are struggling to
answer telephones with the increased workload demands. We handled about
58 million calls in Fiscal Year 2009. This is an increase of 4 million
calls from FY 2008. SSA studies by the Office of Quality Performance
state Field Office telephone busy rates were about 58% in Fiscal 2009,
which is an increase of 3% from the prior year. Many offices must
direct staff to handle walk in traffic to reduce waiting times, and as
a result have insufficient staff to answer telephone calls.
7. Training. Field Office management is having difficulty with
allocating sufficient time for ongoing staff training. Workload demands
necessitate that direct staff be assigned to accomplish production work
at the expense of much needed training.
8. eServices or Internet. SSA is transitioning more work processes
to electronic service delivery. The FY 2010 goal is to have 38% of
Retirement claims and 25% of Title II Disability claims filed on the
Internet. SSA Field Offices have had to address significant issues
resulting from the increased volume of claims filed electronically.
Almost all Disability Internet applicants must be recontacted to
perfect the application. For Retirement claims, many claimants must be
recontacted to address the error prone area of month of election. While
electronic services have assisted Field Offices significantly with the
unprecedented high number of SSA applications received, it is important
to note that staff must still spend significant time processing many of
these electronically initiated actions. Also, electronic services
provide only minimal relief to inner city offices, offices with rural
service areas, and areas with a high percentage of non-English speaking
applicants, because these areas have populations not as likely to use
or have access to computers or the Internet.
It is essential that SSA continues to receive positive budgets to
ensure that Field Offices are able to adequately serve the American
public and to process important workloads. As illustrated above, even
with the recent more favorable SSA budgets, Field Offices are still
struggling with tremendous workload demands. We are also especially
concerned about the program integrity workloads and the billions of
dollars that are being lost due to the backlog of medical CDRs and
overpayments in the SSI program.
Commissioner Astrue's testimony indicates that Field Offices are
expected to maintain their current staffing levels in FY 2010 and about
2,700 additional positions are scheduled to be added to the Hearing
Offices and DDSs. While additional staff is much needed for the Hearing
Offices and DDSs to address the disability backlogs and these positions
should not be reduced, additional staff for Field Offices would yield
significant improvement in service to the American public and assist
with the disability backlog. Our network of 1,262 community based Field
Offices is an integral part of SSA's service delivery system, and the
Field Office is where the disability process begins and ends. Increased
staff for Field Offices would reduce workload backlogs, address program
integrity concerns, improve SSI accuracy performance, and allow for the
transmittal of a more accurate and complete disability product that
would assist with expediting disability decisions.
SSA's flexibility to continue to provide necessary resources in FY
2010 will be determined much by the President's proposed budget in FY
2011 and future years. If these budgets are not adequate to address the
workload challenges, the progress made in the past two years will be
eroded. Field Offices could redirect some of the overtime dollars
currently expended to hire additional temporary or permanent employees
if flexibility is provided due to the expectation of a favorable SSA
budget in FY 2011.
We believe a minimum of $13.2 billion is needed for SSA's FY 2011
administrative funding. This level of funding would provide SSA with
the resources necessary to continue the progress made, while at the
same time protecting many Americans from severe and unnecessary
economic hardship. Our community based staffs are very committed to
serving the American public, but we must have the tools and resources
to do so. We sincerely appreciate your ongoing support to provide
adequate funding for the Social Security Administration. We remain
confident that this increased investment in SSA will benefit our entire
nation.
On behalf of the members of NCSSMA I thank you for the opportunity
to submit this written statement to the Subcommittee. NCSSMA members
are not only dedicated SSA employees, but they are also personally
committed to the mission of the agency and to providing the best
service possible to the American public.
Linda Fullerton's Letter
Members of the Committee:
My name is Linda Fullerton, President/Co-Founder of the Social
Security Disability Coalition, and it is again with great sadness,
anguish and despair that I submit this testimony to you today as I have
done several times in the past. But as usual my testimony apparently
must not ever be read by anyone there, from what I can tell, based on
what I saw. I watched this entire hearing on the internet, and each
hearing that I see continues to be a source of major frustration for
me. It happened that this hearing took place on my 54th birthday. Most
people would have celebrated their birthday doing joyous types of
things. Unfortunately since I filed for my own Social Security
Disability benefits on December 6th 2001, I no longer have reason to
celebrate much of anything anymore.
My life was permanently destroyed with the stroke of pen by a
neglectful government employee, to whom I was just an SS number, and it
is more than I can bear. So now, not only will I never recover from my
illnesses, but I will never recover from the permanent financial and
physical devastation this has had on my life. After fighting and
waiting for 1\1/2\ years, and losing all my life savings, pension money
and any chance of ever having financial security again, my claim was
finally approved. Even though a person may eventually get their
benefits, the devastation does not miraculously disappear once the
checks start coming. It often leaves a permanent scar on one's life.
The stress I endured during that time and continue to deal with, every
day living on the edge of total ruin, on top of all my illnesses is
unbearable beyond belief and it is killing me. My health problems have
become worse, and new ones have arisen as a result of all this stress.
Each day is worse than the one before, with no hope in sight for any
type of relief. I don't know how I am going to survive without some
miracle like winning the lottery. My ``American Dream'' will never be
realized. I have now been forced to live the ``American Nightmare'' for
the rest of my days, because I happened to get sick, and file a claim
for Social Security Disability benefits, a Federal insurance policy
that I was forced to pay into for over 30 years. I am now doomed to
live in poverty for the rest of my life, in addition to all my medical
concerns. I will never be able to own a home, or get another car. My
current vehicle which is on death's door, is the ONLY method of
transportation I have for survival. When things break down now, I
cannot fix them and have to do without. I struggle every day to pay for
food, medicines, healthcare, gas etc. having to decide which things I
can do without till the next check comes, since I live strictly on the
inadequate, monthly SSDI check I receive, always teetering on the brink
of disaster. I did not ask for this fate and would trade places with a
healthy person in a minute.
As a result of that horrible experience, I thought it was extremely
important to watch the hearing that you held on this issue that affects
the very lives of millions of this nation's most vulnerable citizens. I
would not wish this hell on anyone, and I did nothing wrong to deserve
it, I just happened to get sick in America. I was forced to pay for an
insurance policy out of my paycheck every week, and when I needed that
benefit the most, the Federal Government tried to prevent me from
getting it. Even more sad than my situation, are the ones who have died
while waiting to get their benefits approved.
During 2006 and 2007, at least 16,000 people fighting for Social
Security Disability benefits died while awaiting a decision (CBS News
Report--Disabled And Waiting--1/14/08). This is almost more than 4
times the number of Americans killed in the Iraq war since it began.
During 2007, two-thirds of all applicants that were denied--nearly
a million people--simply gave up after being turned down the first time
(CBS News Report--Failing The Disabled--1/15/08).
PLEASE NOTE--I personally was the source behind these CBS News
reports and was featured in the broadcast of ``Disabled And Waiting.''
Something is seriously wrong, when even one person in this country
should have to be put through this nightmare. You may think I am bitter
but nothing could be further from the truth. I believe everything
happens for a reason, and I learned a lot from this experience. I want
to turn it into something positive, and use this knowledge I have
gained to make sure that nobody else suffers again, when they need help
from the SSA. In fact, in order to do that more effectively, I actually
reached out to the SSA, in spite of my bad experience, and have met
some wonderful people there as a result, who are in fact very dedicated
and hard working individuals. I am forever grateful for their concern
for our problems, but we need many more of them. I testify today, not
to get your pity, but so you can get an accurate picture of what is
really happening to the most vulnerable citizens of this nation. I want
to illustrate how decades of neglect, lack of oversight, and under
funding of the Social Security Administration's Disability program, has
a very negative impact on the lives of disabled Americans such as
myself whom you were elected to serve and protect. Therefore, I must
ask: When are you going to stop this abuse?
Call For Open Congressional/SSA Disability Hearings
I have been following these hearings, for over five years now, and
I find it deeply disturbing, and glaringly obvious, that not one
panelist/witness selected to appear, is an actual disabled American who
has tried to get Social Security Disability benefits, and who has
experienced this nightmare for themselves. Unfortunately this continues
to be the case with this hearing as well. While the witnesses you
continually rely on may be very reputable in their fields, unless you
have personally tried to file a claim for Social Security Disability,
you cannot begin to understand how bad this situation really is, and
therefore the panelists you continue to rely on are not fully qualified
to be the only authority on these issues.
I was forced to watch this hearing on the internet, because my
repeated requests over the last several years to testify in person,
have been blatantly ignored. I have made it very clear in previous
written testimony submitted for the hearing record, through faxes, e-
mails and phone calls, to all the Congresspeople in my district, others
on this Subcommittee, and many others in both the House and the Senate
Committees that affect the Social Security Disability Program in any
way, that I want to testify in person at these important hearings that
directly affect me and others like myself. As an actual disabled
American, I again make the same request today, as I have in the past,
that in future Congressional hearings on these matters, that I be
allowed to actively participate instead of being forced to always
submit testimony in writing, after the main hearing takes place. For
some reason beyond my comprehension, you still will not let me do that.
I often question whether anybody even bothers to read the written
testimony that is submitted when I see the continued lack of results
after previous hearings. I am more than willing to risk my very life
for the opportunity to testify, should I be permitted to do so, since I
believe so strongly in the importance of this program. In fact, I ask
that you call another hearing, and allow me to be the sole witness,
since the eye opening information I have to share with you would fill
the entire 1- 2 hours, since this program is so badly broken, and
filled with corruption at every level. I have also come up with
solutions to all the problems as well, which I would also be discussing
at that time. I want a major role in the Social Security Disability
reformation process, since any changes that occur have a direct major
impact on my own well being, and that of millions of other disabled
Americans just like me. I also propose that Congress immediately set up
a task force made up of SSDI claimants, such as myself, who have
actually gone through the claims process, that has major input and
influence before any final decisions/changes/laws are instituted by the
SSA Commissioner or members of Congress. This is absolutely necessary,
since nobody knows better about the flaws in the system and possible
solutions to those problems, then those who are forced to go through it
and deal with the consequences when it does not function properly.
As a result of my repeatedly denied requests to testify, it is my
opinion, that you don't want to know what is REALLY going on. Since my
last written testimony I have released a video on the internet called:
American Nightmare--It Can Happen To You!
I made it to alert the American people to the ugly realities of
what it is like to try and get the SSDI benefits that they have been
forced to pay for, and may never survive to actually collect. They need
to know how the Federal Government continually breaks its social
contract with them on a daily basis. It seems to me that if you do not
have to face someone such as myself, that has barely lived through this
horrible nightmare, and has had their whole life permanently devastated
as a result of continued neglect of this program, we remain just a
bunch of SS numbers whose lives can be destroyed without guilt. We are
in fact, your mothers, fathers, sisters, brothers, children,
grandparents, friends, neighbors, and honorable veterans who have
served this country. Something is severely wrong with this picture!
When you question the SSA Commissioner at these hearings, why have
you not ordered him to provide the data on how many Americans have
actually died each year, or have been forced to use state provided
services, while waiting for their SS Disability claims to be processed?
Since the SSA also pays out a one time death benefit to a survivor's
family, and contracts out the medical portion of disability claims to
the states who provide the Social Service programs that disability
applicants often need to use, this data should be readily available if
you bothered to ask for it. These are important questions that need to
be answered, but it seems to me you don't care enough about the
disabled to ask them. How can you get an accurate handle on this
situation without all the facts and appropriate witnesses who wish to
testify? Who better to give feedback at these hearings than those who
are actually disabled themselves, and directly affected by the
program's inadequacies! It seems you have forgotten that WE are the
customers, and the SSA and Congress work to serve us. I find it hard to
believe that these hearings cannot be scheduled in such a way that
different and more appropriate witnesses could be allowed to testify.
If you continue to do the same thing over and over again, as you have
for the past several years, you will continually get the same poor
results, which is exactly what is happening. You ask the same
questions, of the same people, and wonder why there is little to no,
improvement between hearings. There is a major piece of the puzzle
missing--the people you have been elected to serve--and until you
really commit to getting the ALL the information needed to fix the
Social Security Disability program, you are making decisions based on a
lack of important information, which can be very detrimental, and the
problems are going to continue to escalate, no matter how much money
you put toward fixing them.
There are five main reasons for the disability hearing backlogs:
Lack of communication and educating the public
States of denial
State and private disability companies forcing
claimants to file disability claims with SSA or risk losing
private coverage
Lack of oversight
Lack of funding
Lack Of Communication Between Claimants, Doctors And SSA, Lack Of
Education On What Is Needed For A Claimant To Prove A
Disability Claim
Currently there is little to no communication between the SSDI
claimant and the SSA caseworkers handling their claims. More
communication is needed and review of records by the claimant should be
available at any time during all stages of the disability determination
process. Before a denial is issued at any stage, the applicant should
be contacted as to ALL the sources being used to make the judgment. It
must be accompanied by a detailed report as to why a denial might be
imminent, who made the determination and a phone number or address
where they could be contacted. Also many times medical records
submitted are lost or totally ignored.
In case info is missing, or the SSA was given inaccurate
information, the applicant can provide the corrected or missing
information, before an actual determination at any level is made. This
would eliminate many cases from having to advance to the hearing or
appeals phase.
Also many times doctors, hospitals etc often do not respond to SSA
requests for medical information in a timely manner, or sometimes
ignore these requests entirely. ALL doctors, and medical professionals
including those at the VA should be required by Federal or State law,
to fill out any medical forms and submit documents requested by the SSA
within strict timelines or they will not be allowed to practice
medicine in this country. Also as part of their continuing education
program in order to keep their licenses, doctors should also be
required to attend seminars provided free of charge by the SSA, in
proper procedures for writing medical reports and filling out forms for
Social Security Disability and SSI claimants.
The major criteria used by the SSA to decide a disability claim, is
residual functionality and the ``Blue Book Of Listings,'' yet this is
not usually information that the general public is privy to when filing
a disability claim. In fact it is a pretty well kept secret unless you
know enough to do some research. In other words since the process is so
nebulous from beginning to end, the deck is purposely stacked against a
claimant from the very start. When the average person files a claim
they seem to think that all they have to do is mention what is wrong
with them, get their doctors to back up their medical claims, say they
are disabled and cannot work, fill out a few forms and the checks will
start coming in the mail. While in a ideal world the process should be
that simple, nothing could be further from the truth. They do not
realize, and are never told, that they must not only list their
illnesses, but more importantly describe HOW their illnesses prevent
them from doing work and daily activities. They are not told to list
EVERYTHING that is wrong with them, and often only file a claim for one
condition, that in itself may not be disabling, when they have several
of them, that in combination, may in fact render them totally disabled.
Many file claims because they cannot perform the job they have been
doing for years, or cannot work as many hours that used to before they
get sick. They do not fully understand that they have to not be able to
work ANY job in the national economy, and that the SSA does not pay for
partial disability. The SSA needs to do a much better job of educating
the public at the onset of filing a disability claim to avoid
confusion.
States Of Denial--The REAL Reason Behind The Social Security Disability
Hearing Backlogs
Since Social Security Disability is a Federal program, where you
live should not affect your ability to obtain benefits. Sadly this is
not the case. While funding is a major problem that SSA faces, the
other primary reason for these hearing backlogs, continues to be
ignored during these proceedings, and that is the initial phase of the
disability qualification process which is handled by the individual
state DDS/Disability Determination Services offices. There, the most
crucial part of your disability claim, the medical portion, is reviewed
by a caseworker/adjudicator and medical doctor on their staff who never
sees you, and in most cases never even communicates with you at all.
Too much weight at the initial time of filing, is put on the SS
caseworker's opinion of a claim. There needs to be more oversight that
disability decisions be based with controlling weight given to the
claimant's own treating physicians opinions and medical records in
accordance with (DI 24515.004) SSR 96-2p: Policy Interpretation Ruling
Titles II And XVI: Giving Controlling Weight To Treating Source Medical
Opinions. Even though this policy ruling is in place, this is very
often not happening.
Excerpts from GAO-09-511T--Further Actions Needed to Address
Disability Claims and Service Delivery Challenges--3/24/09:
Although SSA is responsible for the program, the law calls
for initial determinations of disability to be made by state
DDS agencies. The work performed at DDS offices is federally
financed and carried out under SSA disability program
regulations, policies, and guidelines. See 42.U.S.C.
Sec. 421(a)(1).
From September 1998 to January 2006, over 20 percent of
disability examiners hired during that period left or were
terminated within their first year. DDS officials said the loss
of experienced staff affects DDS' ability to process disability
claims workloads because it generally takes newly hired
examiners about 2 years to become proficient in their role.
For example in November 2009:
Mississippi had the lowest percentage of approvals at
the initial level of 24.4%
Alaska and Colorado had the lowest percentage of
approvals at the reconsideration level of 0%
Puerto Rico had the highest percentage of approvals
at the initial level of 61.9%
Massachusetts had the highest percentage of approvals
at the reconsideration level of 30.5%
Source: Social Security Administration--November 2009.
That is a major fluctuation depending on what state you happen to
apply for benefits in. Something is extremely wrong with this picture
and proves the inconsistency of decision making by the state DDS
offices in handing Federal disability claims.
What would be an incentive for states to deny Federal claims? Since
many Social Security Disability claims are SSI or both SSI/SSDI
combined claims and many states offer to supplement SSI payments at a
higher benefit amount, therefore they want to keep as many off the
rolls as possible so they do not have to pay out this supplement. Also
since there is a different pay scale for government vs state employees
who are often underpaid, lack training, are overworked, and must meet
quotas of cases processed, the tendency is greater to rubber stamp
denials to move claims off their desk when a case needs too much
development. Thus the explanation for the fluctuation in denial/
approval/backlog rates by state. Unfortunately there is very little if
any training or oversight on the state DDS offices to make sure they
are making the proper decisions on disability claims. This is why so
many claimants appeal to the hearing level where a huge percentage of
bad claims decisions are overturned and cases are finally approved.
Anyone who doesn't see that a ``Culture Of Denial'' has become a
pervasive part of an SSDI claimants encounter with the SSA, is either
totally out of touch with reality or is reacting evasively to the
subject.
Excerpts from GAO Report GAO-04-656--SSA Disability Decisions: More
Effort Needed To Assess Consistency of Disability Decisions--
Washington--July 2004:
``Each year, about 2.5 million people file claims with SSA
for disability benefits . . . About one-third of disability
claims denied at the state level were appealed to the hearings
level; of these, SSA's ALJ's have allowed over one-half, with
annual allowance rates fluctuating between 58 percent and 72
percent since 1985. While it is appropriate that some appealed
claims, such as those in which a claimant's impairment has
worsened and prohibits work, be allowed benefits,
representatives from SSA, the Congress, and interest groups
have long been concerned that the high rate of claims allowed
at the hearing level may indicate that the decision makers at
the two levels are interpreting and applying SSA's criteria
differently. If this is the case, adjudicators at the two
levels may be making inconsistent decisions that result in
similar cases receiving dissimilar decisions.''
``Inconsistency in decisions may create several problems . .
. If deserving claimants must appeal to the hearings level for
benefits, this situation increases the burden on claimants, who
must wait on average, almost a year for a hearing decision and
frequently incur extra costs to pay for legal representation .
. . SSA has good cause to focus on the consistency of decisions
between adjudication levels. Incorrect denials at the initial
level that are appealed increase both the time claimants must
wait for decision and the cost of deciding cases. Incorrect
denials that are not appealed may leave needy individuals
without a financial or medical safety net . . . An appeal adds
significantly to costs associated with making a decision.
According to SSA's Performance and Accountability Report for
fiscal year 2001, the average cost per claim for an initial DDS
disability decision was about $583, while the average cost per
claim of an ALJ decision was estimated at $2,157 . . . An
appeal also significantly increases the time required to reach
a decision. According to SSA's Performance and Accountability
Report for fiscal year 2003, the average number of days that
claimants waited for an initial decision was 97 days, while the
number of days they waited for an appealed decision was 344
days . . . In addition, claimant lawsuits against three state
DDS's have alleged that DDS adjudicators were not following
SSA's rulings or other decision making guidance . . . However,
according to DDS stakeholder groups, SSA has not ensured that
states have sufficient resources to meet ruling requirements,
which they believe may lead to inconsistency in decisions among
states. Furthermore, SSA's quality assurance process does not
help ensure compliance because reviewers of DDS decisions are
not required to identify and return to the DDS's cases that are
not fully documented in accordance with the rulings. SSA
procedures require only that the reviewers return cases that
have a deficiency that could result in an incorrect decision.''
Excerpts from: Statement For The Record Of The National Association
Of Disability Examiners--Georgina Huskey, President--Prepared For
Subcommittee on Social Security/Subcommittee on Income Security and
Family Support Of the Committee on Ways and Means Joint Hearing on
Eliminating the Social Security Disability Backlog--March 24, 2009:
``Even at the DDS level, where few backlogs are publicly
reported and where the average processing time for an initial
claim is nearly 100 days, the stark reality is that there are
tremendous backlogs pending. Just because disability claims
have been assigned does not mean they are being worked and
disability examiners who carry caseloads two, three and even
four times the number deemed reasonable are, in essence,
housing a backlog of claims at their desk. Unfortunately, this
backlog of claims can lead to mistakes in case development and
contribute to mistakes in judgment, resulting in the potential
for erroneous decisions.''
``As experienced staff walk out the door, either due to
retirement or because of career changing decisions, SSA and the
DDSs have struggled in many parts of the country to attract the
kind of new hires that will keep the Agency at a level of
competence required in its service delivery. Prior to the
recent economic downturn, DDSs were reporting an annual
attrition rate approaching 15% with more than 22% of newly
hired disability examiners leaving by the end of their first
year. The result has been an increasing lack of experienced
personnel to process increasingly more complex disability
claims and forcing the DDSs to utilize limited training funds
to continually hire new staff, rather than provide ongoing
training for existing staff.''
Furloughs By States Of DDS Workers/Federalizing DDS Workers
There has been a movement in many states over the past several
months to furlough the DDS workers in an effort to ``save money'' for
the states due to their increasing budget problems. What is not often
communicated properly to the public is that these workers are in fact
paid by the Federal Government and not the states. Therefore no actual
money is saved by these furloughs and the public is harmed greatly due
to their inability to be able to work. If federal disability claims
take longer to process, then there becomes a greater need for these
claimants to file for state services such as Medicaid, food stamps and
cash assistance and in fact causes the more burden to the states. It
amazes me that the state governments continually fail to see this
connection.
404.1640 Performance Standards--General
The following sections provide the procedures and guidelines we use
to determine whether the State agency is substantially complying with
our regulations and other written guidelines, including meeting
established national performance standards. We use performance
standards to help assure effective and uniform administration of our
disability programs and to measure whether the performance of the
disability determination function by each State agency is acceptable.
Also, the standards are designed to improve overall State agency
performance in the disability determination process and to ensure that
benefits are made available to all eligible persons in an accurate and
efficient manner. We measure the performance of a State agency in two
areas--processing time and quality of documentation and decisions on
claims. State agency compliance is also judged by State agency
adherence to other program requirements. [56 FR 11020, Mar. 14, 1991]
404.1641 Standards of performance
(a) General. The performance standards include both a target level
of performance and a threshold level of performance for the State
agency. The target level represents a level of performance that we and
the States will work to attain in the future. The threshold level is
the minimum acceptable level of performance. Performance below the
threshold level will be the basis for the Commissioner's taking from
the State agency partial or complete responsibility for performing the
disability determination function. Intermediate State agency goals are
designed to help each State agency move from its current performance
levels to the target levels.
(b) The target level. The target level is the optimum level of
performance. There are three targets--one for combined Title II and
Title XVI initial performance accuracy, one for Title II initial
processing time, and one for Title XVI initial processing time.
(c) The threshold level. The threshold level is the minimum
acceptable level of performance. There are three thresholds--one for
combined Title II and Title XVI initial performance accuracy, one for
Title II initial processing time, and one for Title XVI initial
processing time.
(d) Intermediate goals. Intermediate goals are levels of
performance between the threshold levels and the target levels
established by our appropriate Regional Commissioner after negotiation
with each State agency. The intermediate goals are designed to help the
State agencies reach the target levels. Failure to meet these goals is
not a cause for considering the State agency to be substantially
failing to comply with the performance standards. However, failure to
meet the intermediate goals may result in consultation and an offer of
optional performance support depending on the availability of our
resources. [46 FR 29204, May 29, 1981, as amended at 56 FR 11020, Mar.
14, 1991; 62 FR 38452, July 18, 1997]
404.1642 Processing time standards
(a) General. Title II processing time refers to the average number
of days, including Saturdays, Sundays, and holidays, it takes a State
agency to process an initial disability claim from the day the case
folder is received in the State agency until the day it is released to
us by the State agency. Title XVI processing time refers to the average
number of days, including Saturdays, Sundays, and holidays, from the
day of receipt of the initial disability claim in the State agency
until systems input of a presumptive disability decision or the day the
case folder is released to us by the State agency, whichever is
earlier.
(b) Target levels. The processing time target levels are:
(1) 37 days for Title II initial claims.
(2) 43 days for Title XVI initial claims.
(c) Threshold levels. The processing time threshold levels are:
(1) 49.5 days for Title II initial claims.
(2) 57.9 days for Title XVI initial claims. [46 FR 29204, May
29, 1981, as amended at 56 FR 11020, Mar. 14, 1991]
404.1643 Performance accuracy standard
(a) General. Performance accuracy refers to the percentage of cases
that do not have to be returned to State agencies for further
development or correction of decisions based on evidence in the files
and as such represents the reliability of State agency adjudication.
The definition of performance accuracy includes the measurement of
factors that have a potential for affecting a decision, as well as the
correctness of the decision. For example, if a particular item of
medical evidence should have been in the file but was not included,
even though its inclusion does not change the result in the case, that
is a performance error. Performance accuracy, therefore, is a higher
standard than decisional accuracy. As a result, the percentage of
correct decisions is significantly higher than what is reflected in the
error rate established by SSA's quality assurance system.
(b) Target level. The State agency initial performance accuracy
target level for combined Title II and Title XVI cases is 97 percent
with a corresponding decision accuracy rate of 99 percent.
(c) Intermediate Goals. These goals will be established annually by
SSA's regional commissioner after negotiation with the State and should
be used as stepping stones to progress towards our targeted level of
performance.
(d) Threshold levels. The State agency initial performance accuracy
threshold level for combined Title II and Title XVI cases is 90.6
percent.
404.1650 Action we will take if a State agency does not meet the
standards
If a State agency does not meet two of the three established
threshold levels (one of which must be performance accuracy) for two or
more consecutive calendar quarters, we will notify the State agency in
writing that it is not meeting the standards. Following our
notification, we will provide the State agency appropriate performance
support described in 404.1660, 404.1661 and 404.1662 for a period of up
to 12 months. [56 FR 11020, Mar. 14, 1991]
404.1670 Substantial Failure--General
After a State agency falls below two of three established threshold
levels, one being performance accuracy, for two consecutive quarters,
and after the mandatory performance support period, we will give the
State agency a 3-month adjustment period. During this 3-month period we
will not require the State agency to meet the threshold levels.
Following the adjustment period, if the State agency again falls below
two of three threshold levels, one being performance accuracy, in two
consecutive quarters during the next 12 months, we will notify the
State that we propose to find that the State agency has substantially
failed to comply with our standards and advise it that it may request a
hearing on that issue. After giving the State notice and an opportunity
for a hearing, if it is found that a State agency has substantially
failed to make disability determinations consistent with the Act, our
regulations or other written guidelines, we will assume partial or
complete responsibility for performing the disability determination
function after we have complied with 404.1690 and 404.1692. [56 FR
11021, Mar. 14, 1991]
404.1690 Assumption of Disability Determination function when we make a
finding of substantial failure
(a) Notice to State. When we find that substantial failure exists,
we will notify the State in writing that we will assume responsibility
for performing the disability determination function from the State
agency, whether the assumption will be partial or complete, and the
date on which the assumption will be effective.
(b) Effective date of assumption. The date of any partial or
complete assumption of the disability determination function from a
State agency may not be earlier than 180 days after our finding of
substantial failure, and not before compliance with the requirements of
404.1692.
All phases of disability claims processing should be moved to and
handled out of the Social Security individual field offices, including
the DDS phase which is the medical determination phase currently
handled by the states, and all hearing phases of the disability
process. All people who process Social Security disability claims
should be employees of the Federal Government to ensure accuracy and
uniform processing of disability claims under Federal regulations and
Social Security policies which is currently not the case. If the states
are to continue to handle the DDS phase of the disability process, then
all state employees handling Social Security claims should be required
to receive a minimum of 3 months standardized training by the Social
Security Administration, in SSA policies and Federal regulations
governing SSDI/SSI claims processing. If more time and effort were put
forth to communicate with claimants, and to make the proper decision at
the onset, there would be no need for all these cases to be appealed to
the hearings level in the first place. That in itself would be a huge
factor in reducing the hearing backlogs, but this fact has been greatly
ignored. Until you properly devote the time and energy to look into and
reform this crucial part of the problem, the hearing backlogs will
continue to grow at an uncontrollable rate, no matter how much money
you give to the SSA.
Social Security Disability Program Problems--Contributing Burden Factor
on Medicaid/Social Service Programs For States
There seems to be a relationship, between SSDI claims processing
issues/backlogs, and the need for claimants to also apply for state
funded Medicaid/Social Service programs. Many are forced to file for
Medicaid, food stamps and cash assistance, another horrendous process.
For example in New York State, about half the 38,000 people now waiting
on disability appeals, for an average of 21 months, are receiving cash
assistance from the state (New York Times 12/10/07). Those who file for
these programs while waiting to get SSDI benefits, in many states, have
to pay back the state out of their meager benefit checks once approved.
As a result they're often kept below the poverty level, almost never
able to better themselves since they can't work, and now are forced to
rely on both state and federally funded programs instead of just one of
them. This practice should be eliminated.
Regulation Is Necessary To Avoid Improper Social Security Disability
Claim Filings Due To State And Private Insurance Company
Policies
There is a growing number of claims being filed by people who may
not actually qualify for disability benefits under Social Security
guidelines, but who are being forced to file Social Security
Disability/SSI claims by their private disability and state disability
carriers or risk not being eligible for benefits under those programs.
Recently there has been media coverage on this issue which can be found
here:
Insurers Faulted As Overloading Social Security--NY Times--
Mary Williams Walsh--4/1/08
http://www.nytimes.com/2008/04/01/business/
01disabled.html
Exhibit D--Letter To Senator Charles Grassley From Disability
Claimant Who Was Required By Private Insurer To File Claim For
Social Security Disability Regardless Of Eligibility Or Risk
Loss Of Private Disability Insurance Benefits--1/21/09
http://grassley.senate.gov/private/upload/Exhibit-D.pdf
Exhibit E--Letter From SSA Commissioner To FTC Chairman
Regarding Private Disability Companies Requiring Their
Claimants To File For Social Security Disability Benefits--11/
26/08
http://grassley.senate.gov/private/upload/Exhibit-E.pdf
Congress and the SSA needs to look into this issue and this
practice needs to be stopped immediately as this too greatly
adds to the disability backlog problem. In this case the
claimants should not be penalized but the insurance companies
should be.
Lack Of Oversight Which Is Crucial To Resolving The Hearing
Backlogs
It is obvious that for decades oversight of SSA practices has
been greatly, lacking which is one of the major reasons we have
the enormous hearing backlog you are dealing with today. At the
hearing you asked the Commissioner why he was not using the
Federal regulations listed above to help the states and
claimants deal with the furlough issue and he had no good
answer. The incredibly high denial rates at the initial and
reconsideration levels, are highly suspect, and eventual
approval of a majority of these cases at the hearing level
proves that lack of oversight at these phases contributes to
the hearing backlog as well. In an editorial letter from SSA
Commissioner Astrue dated 8/21/08 to the Atlanta Journal
Constitution in regards to the severe hearing backlogs it was
stated that ``We have taken a big step toward resolving that
problem by bringing onboard 175 additional administrative law
judges and additional staff to support them.''
In reality:
At of the end of fiscal year 2007 the amount of ALJ's
available to hear cases was at 1006, and at the end of fiscal
year 2008 the amount of ALJ's available to hear cases dropped
to 960.13. In fiscal year 2009 there were in fact only 1056.63
ALJ's available to hear cases.
Source: Social Security Administration Reports
The 175 new ALJ's that the SSA Commissioner hired has in reality
only added 50 judges over the fiscal year 2007 level. Basically this is
still inadequate amount of ALJ's, since it does not account for the
fact that more judges may continue to leave for various reasons
(retirement etc), and that the level of disability claims continues to
increase instead of decrease, based on past history. The Commissioner
has failed to publicly account for this fact, so he makes it sound like
there is going to be several additional ALJ's above and beyond previous
years, when he is in reality replacing judges who are leaving and not
actually increasing by any substantial amounts, the number of the
additional staff he truly needs. Also very often these judges have not
even been allocated to the areas that have the largest hearing backlogs
and there is no oversight on the SSA Commissioner to make sure they go
where they are needed most. So the likelihood of the claims backlog
being resolved with this so called ``fix'' is slim to none. In other
words ``this is like putting a band aid on a gushing wound.'' More
investigation of this problem by Congress, the Inspector General and
GAO needs to happen immediately!
Horrendous Customer Service--Where Is The Oversight?
In a January 2007 Harris poll designed to evaluate the services
provided by 13 federal agencies, the public rated SSA at the bottom of
the public acceptance list and it was the only agency that received an
overall negative evaluation. SSA Field Offices have lost over 2,500
positions since September 2005 and nearly 1,400 positions since
September 2006. In 2007 SSA Field Offices saw about 43 million visitors
a week, and that number is expected to increase by over a million more
in 2008. Constituents visiting these local Field Offices continue to
experience lengthy waiting times and the inability to obtain assistance
via the telephone.
Here is just a small sampling of some of the major problems with
the current Social Security Disability program and State Disability
(DDS) offices who process the initial phase/medical portion of
disability claims:
Severe under staffing of SSA workers at all levels of
the program Claimants waiting for weeks or months to get
appointments, and hours to be seen by caseworkers at Social
Security field offices Extraordinary wait times between the
different phases of the disability claims process
Very little or no communication between caseworkers
and claimants throughout the disability claims process before
decisions are made.
Employees being rude/insensitive, not returning
calls, not willing to provide information to claimants or not
having the knowledge to do so
Complaints of lost files and in some states, case
files being purposely thrown in the trash rather than processed
properly
Security Breaches--Complaints of having other
claimants information improperly filed/mixed in where it
doesn't belong and other even worse breaches
Fraud on the part of DDS/OHA offices, ALJ's, IME's--
purposely manipulating or ignoring information provided to deny
claims, or doctors stating that they gave medical exams to
claimants that they never did.
Claimants being sent to doctors that are not trained
properly, or have the proper credentials in the medical field
for the illnesses which claimants are being sent to them for.
Complaints of lack of attention/ignoring--medical
records provided and claimants concerns by Field Officers, IME
doctors and ALJ's.
Employees greatly lacking in knowledge of and in some
cases purposely violating Social Security and Federal
Regulations (including Freedom of Information Act and SSD Pre-
Hearing review process).
Claimants cannot get through on the phone to the
local SS office or 800 number (trying for hours even days)
Claimants getting conflicting/erroneous information
depending on whom they happen to talk to at Social Security--
causing confusion for claimants and in some cases major
problems including improper payments
Proper weight not being given to claimants treating
physicians according to SSA Federal Regulations when making
medical disability determinations on claims.
Complaints of ALJ's ``bribing'' claimants to give up
part of their retro pay (agreeing to manipulation of disability
eligibility dates) or they will not approve their claims
Poor/little coordination of information between the
different departments and phases of the disability process
Complaints of backlogs at payment processing centers
once claim is approved
Federal Quality Review process adding even more wait time to claims
processing, increasing backlogs, no ability to follow up on claim in
this phase.
NOTE: These complaints refer to all phases of the SSDI claims
process including local field offices, state Disability Determinations
offices, CE/IME physicians, Office of Hearings and Appeals, the Social
Security main office in MD (800 number).
Improper CE/IME Medical Exams Ordered By Social Security Result In
Higher Rate Of Denials, Hearings And Appeals
Too much weight at the initial time of filing, is put on the
independent medical examiner's opinion of a claim. CE/IME examiners are
paid a fee by Social Security for each person they see, so the more
claimants they process, the more money they make. Often times they are
caught saying they performed exams that they in fact never performed,
make mistakes, or make false, misleading statements about claimants.
Many times the DDS offices or ALJ's are sending claimants to doctors
that have very limited knowledge of their specific health conditions,
who are not specialists, or even the proper type of doctor, to be
examining a claimant for the type of medical conditions that they have.
These doctors have no real idea how a patient's medical problems affect
their lives after only a brief visit with them, and yet their opinion
is given greater authority than a claimant's own treating physician who
sees them in a much greater capacity? Something is way out of line with
that reasoning, yet it happens every day. Even though a claimant's
treating physicians are supposed to be given greater weight in decision
making, this is often not the case. Whenever SSA required medical exams
are necessary, they should only be performed by board certified
independent doctors who are specialists in the disabling condition that
a claimant has (example--Rheumatologists for autoimmune disorders,
Psychologists and Psychiatrists for mental disorders). Common sense
dictates that these poorly executed, and often unnecessary, medical
exams result in a waste of time, money and energy, for both the
claimants and the SSA, especially when the claimant ends up appealing a
denial based on these improper SSA ordered examinations.
Utilize Hearing On The Record/Pre-Hearing Review Option To Reduce
Backlogs
More emphasis and support staff need to be devoted to the pre-
hearing review process which could greatly reduce the current hearing
backlog. This would obviously and should require more communication
between hearing office staff and claimants or their representatives to
update case files. Once the files have been updated, many would be able
to be decided solely on the records in the file without having a full
hearing in front of an ALJ.
Changes/Proper Funding Necessary For SSA To Accomplish It's Goals And
Properly Serve Disabled Americans
I continually hear talk at these hearings about increasing the
funding for the SSA, and you asking witnesses for answers, on how much
the SSA will need to fix the current problems, and prevent new ones
from arising in the future. One thing is said at the hearings, but when
push comes to shove to vote for the SSA budget money, other programs or
projects become higher priority, even though properly funding the SSA
is literally a matter of life and death for millions of Americans.
Nothing is more important than the health and well being of the
American people, and as elected officials it is crucial that you never
lose sight of that priority! Still I see that the SSA is under funded
almost every year, and there is a continued challenge to get the money
that the SSA requests. SSA should not have to compete each year for
funding with the Departments of Labor, HHS and Education which are
highly publicized and therefore, often more popular programs. All money
that is taken out of American's paychecks for Social Security should
not be allowed to be used for anything else other than to administer
the program and pay out benefits to the American people.
As stated in the previous testimony provided by Witlold
Skierwczynski--President--National Council Of Social Security
Administration Field Operation Locals to the House Ways And Means
Committee on 4/23/08 it is recommended that:
Congress should enact off budget legislation including SSA
administrative expenses with benefits which are already off
budget. Congress should retain appropriations and oversight
authority albeit unencumbered by artificial budget caps and
scoring restrictions.
Congress should enact legislation requiring the Commissioner
to submit the SSA appropriation request directly to Congress.
Congress should support the House Budget Committee
recommendation to increase the SSA administrative budget by
$240 million over the President's budget request.
Social Security Disability Claimants Face Permanent Devastation And
Death Resulting From The SSDI Claims Process
Social Security Disability is an insurance policy which was created
to be a safety net for millions of disabled Americans, and for many
such as myself, it has become their only lifeline for survival.
Unbearable stress, severe depression and suicidal thoughts are very
common side effects of the disability claims process. I know this not
only from my own personal experience, but from thousands of others that
have contacted me to tell me their horror stories. The abuse and worry
that applicants are forced to endure, causes even further irreparable
damage to their already compromised health, and is totally
unacceptable. Due to the total devastation on their lives and health as
a result of the SSDI claims process, use of the SS Ticket to Work
program, or any future chance of possibly getting well enough to return
to the work force, even on a part time basis, becomes totally out of
the question. Plus there is always the stress of having to deal with
the SS Continuing Disability Review Process every few years, where the
threat of having your benefits suddenly cut off constantly hangs over
your head.
I must report with great sadness and disgust, that all these
hearings have not brought about much progress, if any at all, and
things continue to worsen by the day. In our country you're required to
have auto insurance in order to drive a car, you pay for health
insurance, life insurance etc. If you filed a claim against any of
these policies, after making your payments, and the company tried to
deny you coverage when you had a legitimate claim, you would be doing
whatever it took, even suing, to make them honor your policy. Yet the
government is denying Americans their right to legitimate SSDI benefits
everyday and this is an outrage! I continually hear you talk about
hearing waiting times 200 days vs 600 days, like it was nothing but a
number. Everyday that a disabled American must wait for their benefits,
is a day that their life hangs on by a thread, or worse yet, they do
not survive. The stress from that alone is enough to kill anyone. Since
it has been proven over the years that the average American has about
two weeks worth of savings, anything over a 14 day waiting period in
any phase of the SSDI process is totally unacceptable. Cutting hearing
wait times down to even 30 days, is nothing to tout as some great
accomplishment on your part, as it still puts claimants lives in
jeopardy. If any other private company/organization operated with as
poor customer service, and processing times that the SSA currently
does, subjecting people to hours, days, weeks, months, and worse yet
years, to get their issues resolved, all employees would be fired, and
they would be shut down within weeks. Nobody would even attempt to give
them their business, yet Americans are held hostage to the SSA since
they are required to pay for their services out of their wages, and
rightfully expect to get what they have paid for. This is outrageous
when something this serious, and a matter of life and death, could be
handled in such a poor manner. Common sense would also lead you to the
conclusion, that there is a strong correlation between the crisis that
disabled Americans face while trying to get their benefits, and the
housing, and economic meltdown this country is in the midst of. I
challenge anyone of you to try and live for more than two weeks, not
relying on your assets (since many SSDI applicants lose all their
assets while waiting for a decision on their claims), with absolutely
no income, and see how well you survive. Also keep in mind that you are
not disabled on top of it, which adds its own challenges to the
problem. Based on my own experience, and the experiences of thousands
of others which have been shared with me, and current conditions, I
firmly believe that the SSDI/SSI program is structured to be very
complicated, confusing, and with as many obstacles as possible, in
order to discourage and suck the life out of claimants, hoping that
they ``give up or die'' trying to get their disability benefits! The
statistics at the beginning of this testimony back up my statement:
Disabled Americans Unite For Reform Of Social Security
Disability Insurance Program
The Social Security Disability Coalition, of which I am
President/Co-Founder, is made up of Social Security Disability
claimants and recipients from all over the nation. It was born
out of the frustration of my own experience, and the notion
that others may be dealing with that same frustration. I was
proven to be totally correct beyond my wildest imagination. Our
group is a very accurate reflection and microcosm of what is
happening to millions of Social Security Disability applicants
all over this nation. We fill a void that is greatly lacking in
the SSDI/SSI claims process. While we never represent claimants
in their individual cases, we are still able to provide them
with much needed support and resources to guide them through
the nebulous maze that is put in front of them when applying
for SSDI/SSI benefits. In spite of the fact that the current
system is not conducive to case worker, client interaction
other than the initial claims intake, we continue to encourage
claimants to communicate as much as possible with the SSA in
order to speed up the claims process, making it easier on both
the SSA caseworkers and the claimants themselves. As a result
we are seeing claimants getting their cases approved on their
own without the need for paid attorneys, and when additional
assistance is needed we connect them with FREE resources to
represent them should their cases advance to the hearing phase.
We also provide them with information on how to access
available assistance to help them cope with every aspect of
their lives, that may be affected by the enormous wait time
that it currently takes to process an SSDI/SSI claim. This
includes how get Medicaid and other State/Federal programs,
free/low cost healthcare, medicine, food, housing, financial
assistance and too many other things to mention here. We
educate them in the policies and regulations which govern the
SSDI/SSI process and connects them to the answers for the many
questions they have about how to access their disability
benefits in a timely manner, relying heavily on the SSA website
to provide this help. If we as disabled Americans, who are not
able to work because we are so sick ourselves, can come
together, using absolutely no money and with very little time
or effort can accomplish these things, how is it that the SSA
which is funded by our taxpayer dollars fails so miserably at
this task?
Social Security Disability Coalition--offering FREE information and
support with a focus on SSDI reform.
http://groups.google.com/group/socialsecuritydisabilitycoalition
Please visit the Social Security Disability Coalition (ARCHIVE)
website, or the Social Security Disability Reform petition website:
Archive Of Old Social Security Disability Coalition MSN
Group Website
http://ssdcoalitionarchive.multiply.com
Sign the Social Security Disability Reform Petition--read the
horror stories from all over the nation:
http://www.petitiononline.com/SSDC/petition.html
At these two sites you will see thousands of stories and over 8000
signatures and comments on our petition, from disabled Americans whose
lives have been harmed by the Social Security Disability program. You
cannot leave without seeing the excruciating pain and suffering that
these people have been put through, just because they happened to
become disabled, and went to their government to file a claim for
disability insurance that they worked so very hard to pay for.
Fraud/Program Integrity--The Stigma Encountered By Social Security
Disability Claimants
SSDI is not welfare, a hand out, reward, golden parachute or
jackpot by any means, and most people would be hard pressed to survive
on it. Yet, often claimants are treated like criminals--viewed as
frauds trying to scam the system, and that the SSA must ``weed out''
them out by making it as hard as possible to get benefits. Yes, I'm
well aware as I write this, that there's some who've abused the system
and that's a shame, because it casts a bad light on those who really
need this help. The percentage of claims that in fact, aren't
legitimate is very miniscule. In March 2009, the average monthly Social
Security Disability Insurance (SSDI) benefit was only $1061.86. Nobody
in their right mind would want to go through this process, and end up
living in poverty on top of their illnesses, if they could in fact
work. I have heard nothing in these hearings or this hearing today that
addresses the fraud on the part of the Federal Government used to deny
deserving claimants their benefits. I have heard nothing about the
rubber stamping of denials, the tossing out of claimant files, the
security breaches of highly sensitive data, the total disregard of
overwhelming evidence by claimants treating physicians, subjecting
claimants to unnecessary fraudulent CE/IME exams, and the cases of
ALJ's ``bribing'' claimants to give up years of back benefits or they
will not approve them. All these things are criminal at best. Most
Americans do not know their rights under the law, that they are allowed
to get copies of their SSA claim files. If more people exercised this
right, they would be horrified to know what was happening behind their
backs, and the true perpetrators of fraud would come to light. in a
major way. The SSA currently spends way more resources to evaluate
cases (Federal Quality Review Process) that are approved, more than any
that are denied unjustly.
In closing, in spite of my own horrible experience, I have vowed to
do everything humanly possible to get total reform of the Social
Security Disability program so that nobody else will ever have to
endure the hell that I have had to. I ask that you please:
Introduce and pass the: Fullerton--Edwards Social Security
Disability Reform Act:
http://groups.google.com/group/
socialsecuritydisabilitycoalition/
web/fullerton-edwards-social-security-disability-
reform-act
Since my time is quickly running out, I hope you will join me soon
in my quest to accomplish this final lifetime goal, to make our country
a better place for our most vulnerable citizens. Thank you for your
time and consideration.
Sincerely,
Linda Fullerton--President/Co-Founder--Social Security Disability
Coalition
Social Security Disability Nightmare--It Could Happen To You!
http://www.frontiernet.net/ lindaf1/SOCIALSECURITYDISABILITYNIGHT
MARE.html
Statement of The Huntington Disease Society of America
On behalf of the Huntington Disease Society of America (HDSA),
thank you to Chairman Tanner, Ranking Member Johnson, and distinguished
Members of the Subcommittee for holding this important hearing and for
the opportunity to submit written testimony today.
Filing for Social Security Disability Insurance (SSDI) is a
complex, burdensome process, especially for those living with a rare
disease such as Huntington's Disease (HD). HD is a genetic
neurodegenerative disease that causes total physical and mental
deterioration over a 10 to 25 year period. The disease affects 30,000
Americans, while another 250,000 are at risk of inheriting it from an
affected parent. Symptoms of HD can include involuntary movement,
dementia, obsessive-compulsive behavior, depression, mood swings,
inability to concentrate and immobility. There is currently no cure for
HD, and while medications may temporarily reduce the intensity of some
symptoms, none halt the progression of the disease. Eventually, every
person diagnosed with HD will lose the ability to live independently as
the disease advances and ultimately claims their life.
Documenting a disability like HD can be difficult because of the
complexity of problems that prevent an individual from working. Given
the often subtle onset of symptoms, it is hard to pinpoint exactly when
a person with HD first became disabled. Further, the neurological
listings under the Disability Evaluation Under Social Security, (also
known as the Blue Book), have not been comprehensively revised in more
than 20 years. As a result, people with HD who apply for Social
Security disability benefits experience numerous delays and denials due
to the continued use of outdated and insufficient medical criteria.
The symptoms of HD that are absent from the current listing and
result in the highest incidence of delays and denial of benefits are
behavioral and cognitive impairments. These impairments include
distortions of mood, and perception. Under the current Blue Book
listing, HD is referred to as ``Huntington's Chorea,'' a name that
captures the physical impairments typical of the latter stages of the
disease but fails to recognize the triad of symptoms that include the
less profound but equally debilitating cognitive and behavioral
symptoms now widely accepted as characteristic of HD. Since HD affects
each individual differently, these declines are often more debilitating
than motor abnormalities. Despite this fact, the lack of visible
dysfunction of motor abnormalities has caused many people affected by
HD to remain undiagnosed and unable to receive badly needed benefits. A
revised definition that captures the complex nature of the disease and
its many emotional and cognitive manifestations beyond the ``chorea''
is needed to reduce the number of delays and reapplications of
genuinely disabled HD individuals.
In 2004, the SSA began a formal rule-making process to revise the
medical criteria for all neurological conditions; a process that has
been plagued with ongoing delays. According to SSA personnel the
proposed final guidelines will be issued no sooner than December 2010
with implementation likely to occur in 2012. The primary source of the
delay is SSA need to revise the criteria for all neurological
conditions.We believe that in order to successfully facilitate HD
applicants through the disability process, clear and separate
guidelines for determining disability due to HD are needed. By
separating the guidelines for HD from the general neurological
listings, the unique symptoms of HD will be identified and addressed.
The backlog of disability claims will be decreased by allowing HD
individuals to apply one time for disability rather than force them to
make multiple applications.
In furtherance of this goal, Representatives Bob Filner (D) and
Brian Bilbray (R) of California introduced H.R. 678, the Huntington's
Disease Parity Act of 2009. This legislation would direct the SSA to
immediately revise the medical criteria for determining disability as a
result of HD.It would also eliminate the two year waiting
period.Currently, there are 56 Representatives who have cosponsored
H.R.678.
As Congress and SSA look for ways to reduce the growing backlog of
disability claims, we ask that the Administrator expedite the rule-
making process, and update the medical criteria and outdated guidelines
for HD. Updating the medical criteria of HD will support SSA's efforts
to make timely and accurate disability determinations. Further,
updating the guidelines would save time, money, resources and emotional
energy on the part of the Social Security Administration and the
individuals and families it serves who suffer the effects of this
disease. Thank you again for holding this important hearing and for the
opportunity to provide Members of the Subcommittee with written
testimony this afternoon.