[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]
USE OF TECHNOLOGY TO
IMPROVE THE ADMINISTRATION OF
SSI'S FINANCIAL ELIGIBILITY REQUIREMENTS
=======================================================================
HEARING
before the
SUBCOMMITTEE ON HUMAN RESOURCES
of the
COMMITTEE ON WAYS AND MEANS
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED TWELFTH CONGRESS
SECOND SESSION
__________
JULY 25, 2012
__________
Serial No. 112-HR15
__________
Printed for the use of the Committee on Ways and Means
----------
U.S. GOVERNMENT PRINTING OFFICE
78-762 PDF WASHINGTON : 2013
For sale by the Superintendent of Documents, U.S. Government Printing
Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800;
DC area (202) 512-1800 Fax: (202) 512-2104 Mail: Stop IDCC,
Washington, DC 20402-0001
COMMITTEE ON WAYS AND MEANS
DAVE CAMP, Michigan, Chairman
WALLY HERGER, California SANDER M. LEVIN, Michigan
SAM JOHNSON, Texas CHARLES B. RANGEL, New York
KEVIN BRADY, Texas FORTNEY PETE STARK, California
PAUL RYAN, Wisconsin JIM MCDERMOTT, Washington
DEVIN NUNES, California JOHN LEWIS, Georgia
PATRICK J. TIBERI, Ohio RICHARD E. NEAL, Massachusetts
GEOFF DAVIS, Kentucky XAVIER BECERRA, California
DAVID G. REICHERT, Washington LLOYD DOGGETT, Texas
CHARLES W. BOUSTANY, JR., Louisiana MIKE THOMPSON, California
PETER J. ROSKAM, Illinois JOHN B. LARSON, Connecticut
JIM GERLACH, Pennsylvania EARL BLUMENAUER, Oregon
TOM PRICE, Georgia RON KIND, Wisconsin
VERN BUCHANAN, Florida BILL PASCRELL, JR., New Jersey
ADRIAN SMITH, Nebraska SHELLEY BERKLEY, Nevada
AARON SCHOCK, Illinois JOSEPH CROWLEY, New York
LYNN JENKINS, Kansas
ERIK PAULSEN, Minnesota
KENNY MARCHANT, Texas
RICK BERG, North Dakota
DIANE BLACK, Tennessee
TOM REED, New York
Jennifer Safavian, Staff Director
Janice Mays, Minority Chief Counsel
______
SUBCOMMITTEE ON HUMAN RESOURCES
GEOFF DAVIS, Kentucky, Chairman
ERIK PAULSEN, Minnesota LLOYD DOGGETT, Texas, Ranking
RICK BERG, North Dakota JIM MCDERMOTT, Washington
TOM REED, New York JOHN LEWIS, Georgia
TOM PRICE, Georgia JOSEPH CROWLEY, New York
DIANE BLACK, Tennessee
CHARLES W. BOUSTANY, JR., Louisiana
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
in electronic form. The printed hearing record remains the official
version. Because electronic submissions are used to prepare both
printed and electronic versions of the hearing record, the process of
converting between various electronic formats may introduce
unintentional errors or omissions. Such occurrences are inherent in the
current publication process and should diminish as the process is
further refined.
C O N T E N T S
__________
Page
Advisory of July 25, 2012, announcing the hearing................ 2
WITNESSES
Carolyn W. Colvin, Deputy Commissioner, Social Security
Administration................................................. 7
Patrick P. O'Carroll, Jr., Inspector General, Social Security
Administration................................................. 42
Paul F. Soczynski, Director of Government Services, Accuity
Solutions...................................................... 50
Marty Ford, Director, Public Policy Office, The Arc of the United
States......................................................... 57
Douglas J. Besharov, Professor, School of Public Policy,
University of Maryland......................................... 66
SUBMISSIONS FOR THE RECORD
Carolyn Colvin, statement........................................ 95
USE OF TECHNOLOGY TO
IMPROVE THE ADMINISTRATION OF
SSI'S FINANCIAL ELIGIBILITY REQUIREMENTS
----------
WEDNESDAY, JULY 25, 2012
U.S. House of Representatives,
Committee on Ways and Means,
Subcommittee on Human Resources,
Washington, DC.
The Subcommittee met, pursuant to notice, at 3:03 p.m., in
Room 1100, Longworth House Office Building, Hon. Geoff Davis
[Chairman of the Subcommittee] presiding.
[The advisory announcing the hearing follows:]
ADVISORY
FROM THE
COMMITTEE
ON WAYS
AND
MEANS
SUBCOMMITTEE ON HUMAN RESOURCES
CONTACT: (202) 225-1721
FOR IMMEDIATE RELEASE
Wednesday, July 25, 2012
HR-15
Chairman Davis Announces a Hearing on the
Use of Technology to Improve the Administration
of SSI's Financial Eligibility Requirements
Congressman Geoff Davis (R-KY), Chairman of the Subcommittee on
Human Resources of the Committee on Ways and Means, announced today
that the Subcommittee will hold a hearing on the use of technology to
improve the administration of the Supplemental Security Income (SSI)
program's financial eligibility requirements. The hearing will take
place on Wednesday, July 25, 2012 in 1100 Longworth House Office
Building, beginning at 3:00 p.m.
In view of the limited time available to hear witnesses, oral
testimony at this hearing will be from invited witnesses only. However,
any individual or organization not scheduled for an oral appearance may
submit a written statement for consideration by the Committee and for
inclusion in the printed record of the hearing.
BACKGROUND:
The Supplemental Security Income (SSI) program is the Nation's
largest Federal means-tested cash assistance program and is
administered by the Social Security Administration (SSA). Unlike the
Social Security Disability and Retirement programs, which require
sufficient past employment covered by Social Security payroll taxes for
eligibility, the SSI program pays benefits to disabled and elderly
individuals who currently have limited income and assets, regardless of
prior work history, using general revenue funds.
In 2012, the SSI program provides monthly cash payments up to $698
per individual or $1,048 per couple, which typically includes
eligibility for Medicaid to cover health expenses. In December 2011,
SSI provided cash assistance to more than 8.1 million children, adults,
and aged individuals at an annual cost of over $49.5 billion, not
including Medicaid expenses. According to the SSA actuaries, the SSI
program is expected to grow by 1 million recipients in the next decade,
with the largest growth coming among those over the age of 65.
Since the program was created in 1972, SSI has applied financial
eligibility requirements to all recipients, primarily in the form of
monthly income and asset tests designed to ensure that individuals do
not have significant current income or assets on which they should
depend before turning to the program for support. For income, an
individual's actual monthly benefit is determined by taking the Federal
SSI benefit and subtracting countable wages and other income received
during a month (generally up to $1,481 per month for an individual with
income only from wages). If countable income is not reported in a
timely manner, it can cause an overpayment that is typically recovered
from an individual's future benefits. Separately, a recipient's assets
must remain below $2,000 for an individual or $3,000 for a couple to
maintain eligibility. Like income, certain items are countable, such as
cash, liquid assets in a bank account, or property that can be sold;
other assets are not counted, such as the value of a primary residence,
car, or burial plot.
The administration of these financial eligibility requirements can
be difficult and error-prone if done manually and based on recipient-
reported data. For fiscal year 2011, the SSI program had a 9.1 percent
error rate, representing $4.6 billion in improper payments. To address
this longstanding issue, SSA continues to look for ways to use
technology to reduce error rates. This includes automated processing
such as its Access to Financial Institutions (AFI) project, which
attempts to confirm asset data reported by recipients with actual
financial institution records. Through this and other automation
efforts, SSA is expected to achieve significant program savings and has
already reduced the SSI error rate by 17 percent in the last 2 years,
even as overall benefit outlays have increased.
In announcing the hearing, Chairman Geoff Davis (R-KY) stated,
``The SSI program provides important financial support for low-income
families with disabled children, disabled adults, and aged individuals.
Especially in a restricted financial environment, we need to ensure SSA
is using technology to its fullest to administer these benefits in an
automated, reliable, and efficient manner. This hearing will review
what progress SSA has been making on that front, which is essential to
targeting limited taxpayer resources to those with the most financial
need.''
FOCUS OF THE HEARING:
The hearing will review SSI financial eligibility requirements and
the use of technology to improve their administration.
DETAILS FOR SUBMISSION OF WRITTEN COMMENTS:
Please Note: Any person(s) and/or organization(s) wishing to submit
for the hearing record must follow the appropriate link on the hearing
page of the Committee website and complete the informational forms.
From the Committee homepage, http://waysandmeans.house.gov, select
``Hearings.'' Select the hearing for which you would like to submit,
and click on the link entitled, ``Click here to provide a submission
for the record.'' Once you have followed the online instructions,
submit all requested information. ATTACH your submission as a Word
document, in compliance with the formatting requirements listed below,
by the close of business on Friday, August 3, 2012. Finally, please
note that due to the change in House mail policy, the U.S. Capitol
Police will refuse sealed-package deliveries to all House Office
Buildings. For questions, or if you encounter technical problems,
please call (202) 225-1721 or (202) 225-3625.
FORMATTING REQUIREMENTS:
The Committee relies on electronic submissions for printing the
official hearing record. As always, submissions will be included in the
record according to the discretion of the Committee. The Committee will
not alter the content of your submission, but we reserve the right to
format it according to our guidelines. Any submission provided to the
Committee by a witness, any supplementary materials submitted for the
printed record, and any written comments in response to a request for
written comments must conform to the guidelines listed below. Any
submission or supplementary item not in compliance with these
guidelines will not be printed, but will be maintained in the Committee
files for review and use by the Committee.
1. All submissions and supplementary materials must be provided in
Word format and MUST NOT exceed a total of 10 pages, including
attachments. Witnesses and submitters are advised that the Committee
relies on electronic submissions for printing the official hearing
record.
2. Copies of whole documents submitted as exhibit material will not
be accepted for printing. Instead, exhibit material should be
referenced and quoted or paraphrased. All exhibit material not meeting
these specifications will be maintained in the Committee files for
review and use by the Committee.
3. All submissions must include a list of all clients, persons and/
or organizations on whose behalf the witness appears. A supplemental
sheet must accompany each submission listing the name, company,
address, telephone, and fax numbers of each witness.
The Committee seeks to make its facilities accessible to persons
with disabilities. If you are in need of special accommodations, please
call 202-225-1721 or 202-226-3411 TDD/TTY in advance of the event (four
business days notice is requested). Questions with regard to special
accommodation needs in general (including availability of Committee
materials in alternative formats) may be directed to the Committee as
noted above.
Note: All Committee advisories and news releases are available on
the World Wide Web at http://www.waysandmeans.house.gov.
* * * CHANGE IN TIME * * *
ADVISORY
FROM THE
COMMITTEE
ON WAYS
AND
MEANS
SUBCOMMITTEE ON HUMAN RESOURCES
CONTACT: (202) 225-1721
FOR IMMEDIATE RELEASE
Wednesday, July 25, 2012
HR-15
Change in Time for Hearing on the
Use of Technology to Improve the Administration
of SSI's Financial Eligibility Requirements
Congressman Geoff Davis (R-KY), Chairman of the Subcommittee on
Human Resources of the Committee on Ways and Means, today announced
that the Subcommittee hearing on the use of technology to improve the
administration of the Supplemental Security Income (SSI) program's
financial eligibility requirements, previously scheduled for 3:00 p.m.
on Wednesday, July 25, 2012, in 1100 Longworth House Office Building,
will now be held at 2:00 p.m.
All other details for the hearing remain the same. (See
Subcommittee on Human Resources Advisory No. HR-15, dated July 25,
2012.)
Chairman DAVIS. Good afternoon. Thank you to our witnesses,
staff members, and visitors for your patience. Unfortunately,
we don't control the whip's schedule for votes. I appreciate
your forbearance in the unanticipated delay.
In today's hearing we are going to review how technology is
being used to improve the administration of the Supplemental
Security Income, or SSI, program. As the Nation's largest
Federal means-tested cash assistance program, SSI is sometimes
called ``the other welfare.'' Last month SSI provided checks to
more than 8.1 million disabled and aging individuals. For
example, that is almost twice as many people as collect welfare
checks under the TANF program.
Unlike other Social Security programs which require prior
work and payroll tax payments, SSI pays monthly checks to
disabled and elderly individuals with limited income and assets
regardless of whether they have worked in the past. Since SSI
was created in 1972, it has had complex eligibility rules
designed to ensure that recipients do not have significant
income or assets on which they should depend before turning to
SSI for support. How these financial eligibility requirements
are working and how their administration can be improved are
the subjects of today's hearing.
It is worth noting that in contrast to other means-tested
programs like food stamps, SSI has continued to enforce these
financial eligibility standards in recent years, which has
helped to keep SSI's growth in check. The administration of
SSI's financial eligibility requirements can be difficult,
prone to error, and extremely time-consuming, draining
administrative resources, especially if done manually and using
recipient-reported data.
In 2011, SSI had annual payments totaling almost $50
billion, not including the cost of Medicaid benefits typically
provided to SSI recipients. It also had a 9.1 percent error
rate, representing a staggering $4.6 billion in improper
payments. As I have described in previous hearings, we can and
should expect more from government. We should expect it to
administer benefits using 21st century technology, not from the
era before the personal computer existed.
We have made significant progress in the past year and a
half enacting into law our data standards provision to jump-
start a process for defining these standards. And I am very
grateful for the true bipartisanship in which Members of the
Republican and Democratic Caucus worked together to give the
tools to repair these broken processes and bring some private-
sector business practices into government.
I believe that SSA can and should significantly contribute
to this process. What is more, I believe SSA will also greatly
benefit from this effort, and it will improve how they
administer all their workloads, including SSI. This is all part
of a larger goal of leveraging technology to prevent improper
payments of all kinds.
Today we will hear about how SSA has expanded nationwide
the Access to Financial Institutions Project, AFI, along with
other efforts to better use technology. These efforts have
shown that while difficult, income and asset tests can be
administered in a timely and cost-effective manner, improving
program efficiency and reducing cost to taxpayers. That is an
important lesson not just for SSI, but across all means-tested
Federal programs.
For example, other programs, like food stamps, have
recently waived these same sorts of complex eligibility rules,
especially asset tests, to speed eligibility determination and
expand benefit payouts. As a result, today one in seven
Americans is eligible for food stamps, at a cost of over $70
billion in 2011. That is triple the level of food stamp
spending in 2002, when the asset test was consistently applied.
In a time of failed stimulus, out-of-control spending, and
a struggling economy, we can't continue on the current fiscal
path. Efficient enforcement of programs--or efficient
enforcement of income and asset tests across means-tested
programs will make it possible for limited taxpayer resources
to be targeted to those with the greatest financial need. In
this, we hope the SSI program can actually show the way.
We look forward to all the testimony today and to working
to improve how this program serves disabled and elderly
individuals who depend on it, as well as ensuring all means-
tested programs efficiently and effectively use tax dollars.
With that, I would like to yield to my friend from Texas,
the Ranking Member Mr. Doggett, to make an opening statement.
Mr. DOGGETT. Thank you very much, Mr. Chairman.
We have worked together on this Subcommittee to ensure
safety-net programs effectively collect and use the information
to determine eligibility. Because Supplemental Security Income
provides modest benefits to aid individuals with disabilities,
seniors, disabled children, our most vulnerable neighbors, it
is critical that the Social Security Administration uses the
most up-to-date technology to fully administer the benefits in
the most efficient manner and ensure that only those
individuals entitled to this important benefit receive it.
But our goal of improving the integrity of SSI as well as
other programs is severely threatened by the Republican
Appropriations Committee, which would cut about a billion
dollars from the Social Security Administration. This comes
after cuts in each of the last 2 years for Social Security, and
this includes moneys that are essential for combating waste,
fraud, and abuse. I believe that this cut means that there will
be fewer SSI redeterminations, and there will be less available
for other program integrity measures.
Every dollar that is invested in SSI eligibility and
disability reviews has produced between $6 and $9 in program
savings. Cutting funding threatens the integrity of these
programs.
Ensuring an effective SSI program is important to over 8
million senior and disabled Americans who receive important
assistance from the program. These benefits are not overly
generous, with the maximum SSI payment providing less than $700
a month for an individual, which reaches less than 75 percent
of the poverty level. But even at these low levels, this
assistance is a vital lifeline for those who have little other
source of income.
In my home State of Texas, over 600,000 of our neighbors
are helped by SSI, including about 55,000 in Bexar County and
17,000 in Travis County. One of these people is a 37-year-old
woman who has Angelman syndrome, which includes cerebral palsy,
seizures, and profound cognitive impairments. She lives in a
group home with other adult women and comes home to stay with
her mother 3 days a week. Her mother says, in these words:
``Without the option of community living, she would be at home.
I would be unable to care for her and would be unable to work.
We would be destitute. Her only other option would be a State
institution, which is unthinkable.''
As we review current efforts to verify SSI eligibility, we
should also consider steps to help SSI recipients comply with
program requirements, especially when they attempt to go to
work. We could take a major step in that direction by
increasing the value of work for SSI recipients. The amount of
wages that an SSI recipient can earn before losing some of
their benefits has not been increased since this program was
first started in 1974, at a time when gas was 50 cents a gallon
and the median household income was about $11,000 a year. There
is a real need to make a change there. If this earnings
exclusion had kept pace with inflation over the last four
decades, it would be well over $300 a month now instead of a
mere $65 a month. Raising the current threshold would not only
promote and reward work, but it would also reduce SSI
overpayments to individuals earning very small amounts from
employment.
Another step that we should take is to continue an expiring
program that helps SSI beneficiaries navigate program rules
when they attempt to go to work. Since 2000, the Work
Incentives Planning and Assistance program has served nearly
half a million SSI and SSDI recipients who are working or
attempting to work, but the program is now expiring, and
Congress, as with so many other areas, has failed to act.
I recently joined Congressman Becerra in introducing
legislation to extend this program and a related one so that we
help SSI recipients understand and comply when they move into
work. This extension would be funded by the Social Security
Administration's basic administration allocation, so taxpayers
won't be out another dime to do it. We really need for the
House to act on it.
I look forward to hearing our witnesses' views on these and
other issues and continuing to work with you, Mr. Chairman.
Thank you.
Chairman DAVIS. Thank you, Mr. Doggett.
I would like to remind our witnesses to limit your oral
testimony to 5 minutes; however, without objection, all the
written testimony will be included as part of the permanent
record.
On our panel this afternoon, we will be hearing from Ms.
Carolyn Colvin, Deputy Commissioner of the Social Security
Administration; the Honorable Patrick P. O'Carroll, Jr.,
Inspector General of the Social Security Administration; Mr.
Paul Soczynski, Director of Government Services, Accuity
Solutions; Ms. Marty Ford, Director of Public Policy, The Arc
of the United States; and Mr. Douglas Besharov, Professor,
School of Public Policy, the University of Maryland.
Ms. Colvin, please proceed with your testimony.
STATEMENT OF CAROLYN W. COLVIN,
DEPUTY COMMISSIONER, SOCIAL SECURITY ADMINISTRATION
Ms. COLVIN. Chairman Davis, Ranking Member Doggett, and
Members of the Subcommittee, thank you for inviting me here to
discuss how we use technology to improve the administration of
the Supplemental Security Income program, or SSI. I am Social
Security's Deputy Commissioner and the Administration's
accountable official for improper payments.
SSI is the safety net in the Social Security Act that
guarantees a minimum income to individuals of limited means who
are aged, blind, or disabled. In addition to a monthly benefit,
SSI eligibility provides recipients in many States with access
to Medicaid. We have administered SSI since the early
seventies, when Congress created the program to replace a
patchwork of State-run income-maintenance programs.
SSI turns 40 this year, and while we now use sophisticated
technology to help us administer the program, the design of the
program itself has remained largely unchanged. I would like to
share with you today some of our best practices and the lessons
we have learned over the last four decades.
While SSI has never been simple, over the years Congress
and the courts have added many new rules which in turn have
made SSI harder to manage. Nearly every change in an SSI
beneficiary's life, from moving to a new apartment to a spouse
picking up an extra shift at work, can affect the benefit. Due
to the structure of the program, some improper payments are
inevitable; however, we continuously look for ways to improve.
Our primary key to success is to regularly review our
beneficiaries' records. These reviews, which we call
redeterminations, help to detect changes and to ensure that our
information is current. We save $6 in benefits for every dollar
we spend, and our redetermination process is highly effective.
When we complete more redeterminations, our payment accuracy
rate goes up.
Another key to our success is our use of data analytics. We
do not have the resources to review every case, so we use
predictive models to help prioritize our program integrity
workload. This modeling focuses our review on the cases with
the greatest return on investment. In 2010, our predictive
model for redeterminations helped us save $1.2 billion more
than what a random selection would have saved.
We have also learned how important technology is to helping
us stay afloat amid staffing losses and growing workloads.
While the SSI program requires the expertise of our trained
employees, we successfully automated routine tasks, freeing our
employees to focus on more difficult issues.
Verifying the resources of SSI beneficiaries is an
important, but error-prone element of eligibility. Through our
partnership with Accuity Solutions, we have developed a
creative approach, the Access to Financial Institutions, or
AFI, Project. AFI allows us to electronically verify bank
account balances as well as discover undisclosed accounts. It
is a significant improvement over the paper-based process it
replaced and has been successful in helping ensure that we only
pay the right people the right amount.
Technology can also make it easier for our beneficiaries to
comply with program rules. One example is our SSI Telephone
Wage Reporting System. This system allows individuals to update
their wage amounts over the phone and correct their SSI
payments before they are overpaid. This application has an
additional simplification feature in that our records are
directly updated with little or no employee intervention. We
are now developing similar wage-reporting applications for the
Internet and smartphone users.
The last best practice that I want to highlight addresses
the importance of sharing data across government. We have
learned that data matches are critical to detect when
beneficiaries have not reported changes to us timely.
Electronic data matches have improved our program-integrity
efforts. We have numerous computer matches with Federal, State,
and local organizations, and we are constantly looking for
cost-effective ways to obtain new data that will improve our
payment accuracy.
Our successes are largely dependent on sustained, adequate
funding. I urge you to support the President's fiscal year 2013
budget request for SSA because we have proven that we deliver.
Through the hard work of our employees and technological
advancements, we have increased productivity by an average of
about 4 percent in each of the last 5 years.
In closing, we continue to look for ways to simplify the
SSI program. As we consider changes, we are also mindful of the
need to balance benefit adequacy, benefit equity, and program
integrity. We look forward to working with the Subcommittee on
these important issues.
I am happy to answer any questions. Thank you.
Chairman DAVIS. Thank you very much, Ms. Colvin.
[The prepared statement of Ms. Colvin follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Chairman DAVIS. Mr. O'Carroll, you are recognized for 5
minutes.
STATEMENT OF PATRICK P. O'CARROLL, JR.,
INSPECTOR GENERAL, SOCIAL SECURITY ADMINISTRATION
Mr. O'CARROLL. Good afternoon, Chairman Davis, Ranking
Member Doggett, and Members of the Subcommittee. Thank you for
the invitation to testify today.
For many years my office has recommended that SSA consider
all available tools and methods to ensure the right person
receives the right payment at the right time. As technology
advances, data matches and electronic records are emerging as
effective tools to improve payment accuracy in Federal programs
like SSI.
Financial and other nonmedical factors can affect SSI
eligibility, such as earnings and income, resources and assets,
living arrangements, and presence in the United States.
SSA's Access to Financial Institutions Project, or AFI, is
a data-matching initiative we recommended years ago that helps
the agency prevent commonplace SSI payment errors. AFI allows
the agency to receive data directly from financial
institutions, rather than relying on recipients to report
assets that may reduce or eliminate the benefits. Self-
reporting, or the lack thereof, is a leading cause of payment
errors. AFI is now in place in all 50 States, and the agency
anticipates $900 million in lifetime program savings for each
year it uses AFI.
My office has also recommended that SSA expand its use of
electronic databases to verify real property and assets. Last
year we estimated that SSA has made improper payments of more
than $2 billion because SSI recipients did not self-report
property ownership to SSA. In recent months, SSA used a real
property database in its stewardship reviews. The agency
reported the records database was an effective tool, and that
SSA would use the database in all SSI reviews in fiscal year
2013.
SSA is also working to collect transactional-level data
from foreign ATMs. This data can identify ineligible recipients
because they were outside of the United States for more than a
month. We recommended this approach in a 2008 audit, which
estimated $225 million in overpayments to 40,000 recipients
outside of the United States. We are working on a review of
SSA's progress in addressing this issue.
We have also made other data-matching recommendations to
SSA to identify marital status, workers' compensation, and
vehicle ownership. We in OIG use data matches in our work as
well, but the Computer Matching and Privacy Protection Act
requires formal computer-matching agreements that can take
years to complete. This prolonged process can delay or derail
time-sensitive audit and investigative projects.
In 2010, the Department of Health and Human Services
obtained a legislative exemption for data matches designed to
identify fraud, waste, or abuse. We are pursuing a similar
exemption, which could serve as a vital tool in our
organization as we combat fraud in SSA's programs.
This office also continues to encourage the agency to seek
funding to support key improper payment-prevention tools. For
example, SSA has reported that it saves $7 for every dollar
spent on redeterminations, which are periodic reviews of an SSI
recipient's eligibility.
In conclusion, it is critical that the agency makes certain
that all SSI payments are correct and timely. SSI recipients
depend on these payments for basic needs. But it is equally
important to protect the integrity of taxpayer dollars through
data matches, electronic records, and traditional reviews. I
applaud Chairman Davis' proposal to expand data-matching across
the Federal Government. For now my office will continue to work
with your Subcommittee and SSA to ensure SSI program integrity
and increase taxpayer savings.
Thank you again for the invitation to testify, and I will
be happy to answer any questions.
Chairman DAVIS. I appreciate that, Mr. O'Carroll.
[The prepared statement of Mr. O'Carroll follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Chairman DAVIS. I still remember that meeting in January of
last year that was quite eye-opening on the complexities the
agency faced with data-matching. You put a little Irish on the
spin of the whole thing for us. We appreciate that moving
forward, as Ranking Member Doggett and I began down that path,
with data standardization. Thank you.
Mr. Soczynski, you are recognized for 5 minutes.
STATEMENT OF PAUL F. SOCZYNSKI,
DIRECTOR OF GOVERNMENT SERVICES, ACCUITY SOLUTIONS
Mr. SOCZYNSKI. Thank you.
Good afternoon. My name is Paul Soczynski. I am the Senior
Director of Government Services for Accuity, Inc. Chairman
Davis, and Ranking Member Doggett and Members, we are grateful
for the opportunity to provide our views on technology and how
they might be used to improve public benefit programs.
Since 1911, Accuity has been the official registrar of the
American Bankers Association U.S. Routing and Transit Codes, a
role that requires us to assign and maintain ABA routing codes
to every deposit-taking financial institution in the United
States. In our role as ABA registrar, Accuity is required to
maintain up-to-date information on the 117,000 financial
institution locations across the United States. As such, we
have earned a unique reputation as the trusted source of
information about and for the banking industry.
As you have heard, Accuity currently manages a technology
solution to facilitate the eligibility process for the SSI
program. In September 2003, Accuity was awarded a contract to
develop and implement a pilot proof-of-concept program designed
to automate the then-existing manual financial asset
verification eligibility component of the SSI benefit program.
We designed the asset verification system to include three main
components: number one, a secure automated gateway between SSA
field offices and the U.S. financial banking institutions;
number two, a comprehensive and accurate database of registered
participating financial institutions; and number three, a Web-
based and direct-transmission Web service technology platform
with sophisticated message-routing logic designed to speed the
process and mechanism and optimize the detection of undisclosed
financial assets.
Following several years of the pilot, for all SSA field
offices in New York, New Jersey, and California, a national
rollout did occur. It commenced in July of 2010, and all 50
States are now operational as of June 2011. Leveraging our
longstanding position in the banking industry and our unique
trusted relationships in the financial institutions across the
country, Accuity has successfully recruited and registered to
participate in the automated solution in 95 percent of the
financial institution locations nationally.
Accuity's asset verification system has successfully
processed millions of automated financial asset-verification
requests and responses utilizing our comprehensive database of
financial institutions. Instead of mailing a paper request form
to a general financial institution address indicated by the SSI
applicant, the request is now sent and received instantaneously
through Accuity's asset verification system. By ensuring the
account balance search for each financial institution is
inclusive of an institution's entire branch network and not
just a single location, the canvassing and search of financial
assets goes beyond local and State borders to include regional
and national searches regardless of where the applicant process
takes place or where the applicant resides.
The system automatically routes alternative multiple
requests to financial institutions based on geographic logic
and account detection probability parameters. The search
algorithm, refined over many years, ensures the additional
financial institutions that are canvassed for possible
undetected financial assets. This added step creates stronger
program integrity by improving the detection of undisclosed
application assets instead of relying solely on the bank
account information provided by the applicant.
Accuity has successfully coordinated and implemented direct
transmission automation with the largest financial institutions
in the country. This direct, end-to-end technology reduces the
need for human intervention in a high-volume environment,
resulting in optimized efficiency, reduced costs, and high-
speed response turnaround times, thus accelerating the overall
determination process for program beneficiaries.
Accuity has been pleased to partner with SSA in proving the
value of technology and serving beneficiaries, while preventing
fraud and abuse. Based on the success of the asset-verification
technology, Congress passed section 1940 of the Social Security
Act. This amendment to the Act requires States to implement a
comparable electronic solution for the aged, blind, and
disabled Medicaid population. While the legislation included
the requirement for all States to have this implemented by
2013, States have been slow to implement the solution. We are
hopeful after initial implementations in various States, that
will become a different reality.
We appreciate the opportunity to inform the Subcommittee
about how we worked developing and implementing a new
technology to provide greater efficiency to taxpayer-funded
programs. I would be pleased to provide additional information
regarding Accuity's asset verification system, and I look
forward to answering your questions today. Thank you.
Chairman DAVIS. Thank you very much, Mr. Soczynski.
[The prepared statement of Mr. Soczynski follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Chairman DAVIS. Ms. Ford, you are recognized for 5 minutes.
STATEMENT OF MARTY FORD, DIRECTOR,
PUBLIC POLICY OFFICE, THE ARC OF THE UNITED STATES
Ms. FORD. Chairman Davis, Ranking Member Doggett, and
Members of the Subcommittee, thank you for the opportunity to
testify on the use of technology to improve the administration
of the SSI financial eligibility requirements.
As you know, SSI benefits, along with related Medicaid
benefits, are the means of survival for over 8 million people
with severe disabilities. SSI benefits help people meet their
basic needs for food and housing, secure medical care, and pay
for medications not covered by Medicaid. SSI also plays a
critical role in helping people with severe disabilities live
in the community rather than in institutions. We applaud SSA's
continued work in improving its technology infrastructure to
improve services to claimants and beneficiaries even during
these challenging economic times.
SSA has recognized that the SSI program rules are
challenging even for administrators of the program. The program
is many times more difficult for SSI beneficiaries to
understand and follow. Beneficiaries are under tremendous
financial stress when they apply for SSI and while they are
using benefits. SSI pays only about 75 percent of the Federal
poverty level for an individual. Beneficiaries often experience
food insecurity, possible homelessness, and personal and family
crisis due to economic hardship. For some, the disability
itself adds its own pressures and makes navigating the
complexity of the SSI program extremely difficult.
The CCD Social Security Task Force generally supports SSA's
efforts to use technology to improve the program so long as the
improvements do not infringe on claimants' rights. We have
always supported SSA's work in conducting continuing disability
reviews and redeterminations to ensure continued integrity of
the SSI and Social Security disability programs.
We recognize that technology can improve the
Administration's efforts in these areas; however, many SSI
applicants and beneficiaries lack electronic access to SSA or
may not be able to understand or navigate electronic
communications. For example, a recent study by the Department
of Commerce found that in 46 percent of households headed by a
person with a disability, there was no computer at home,
compared to 20 percent of homes where the head of household had
no disability. Sadly, our fast-growing electronic world is
creating new barriers for people unable to cognitively or
financially keep pace.
The complexity of the SSI program and the requirements for
reporting and maintaining compliance with the rules, combined
with the push for increased use of technology, will place
increased pressures on those SSI beneficiaries who are unable
to navigate in an electronic world. For these reasons we
believe that SSA must exercise caution to ensure that
beneficiaries are protected. This will require an increased
commitment on the part of the Administration and the Congress
to recognize the increasing difficulties for these
beneficiaries and find solutions for them.
Improvements to the process will save time for both
beneficiaries and SSA, improve accuracy and timeliness, and
hopefully assist beneficiaries who are exploring opportunities
to work. We have some very specific recommendations.
Most importantly, SSA requires adequate administrative
resources to effectively administer the program, including its
financial eligibility requirements. We urge Congress to provide
SSA with adequate resources at the level requested by the
President.
Additionally, SSA needs to develop a better earnings
reporting and recording system, including providing an option
for online wage reporting, for those recipients who can use it,
that allows the agency to promptly adjust benefit payments to
help reduce overpayments and remove barriers for people who
want to work.
SSA should also consider using its continuing disability
review enforcement model to help prevent overpayments before
they happen.
SSA also needs to enhance the use and operation of its
toll-free 800 number.
We support continuation of the WIPA and PABSS programs that
have already been commented on. That is very important for
those people who want to work.
Congress should raise the SSI asset limit and income
disregards and index them annually for inflation. While the SSI
program has numerous work incentives built in to encourage
people to work, the extremely low disregards mean that many SSI
beneficiaries' earnings trigger an overpayment for even
relatively modest amounts of work. Nearly half of beneficiaries
who work earn less than $200 per month. Increasing the
disregards would help beneficiaries and at the same time reduce
SSA's administrative workload.
I will end here and am open to any questions that you have.
Thank you.
Chairman DAVIS. Thank you very much, Ms. Ford.
[The prepared statement of Ms. Ford follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Chairman DAVIS. Mr. Besharov, you are recognized for 5
minutes.
STATEMENT OF DOUGLAS J. BESHAROV, PROFESSOR,
SCHOOL OF PUBLIC POLICY, UNIVERSITY OF MARYLAND
Mr. BESHAROV. Chairman Davis, Ranking Member Doggett, other
Members of the Committee, it is a pleasure to be back.
It was a great pleasure listening to the other speakers
because it is rare that we have this kind of agreement about
the need to move forward, and I was really impressed when I
read about the bipartisan work of this Committee on the data-
matching and the modernization of means-testing programs.
I think I am here a little bit from another world, but let
me tell you why I think it is all connected and why I think it
is so important. In the other means-tested programs that I
watch, whether it is food stamps, WIC, TANF, and so forth, the
process of eligibility determination has become so expensive,
and so much of that cost is on the States, that the States
look--that the Federal Government helps the States to do
everything they can to do less eligibility checking. So, for
example, we have 1-year certifications of income in food
stamps. So, for example, we don't have asset tests in food
stamps anymore. Maybe a little bit of it is ideological, but
the main reason is because it is too expensive to do those
things in the modern world, the modern world where data
processing and data searching are the low-cost answer.
My question is why should both liberals and conservatives
want better eligibility determinations? And I want to spend a
few minutes on that because I think that is the crux of this
discussion.
It is not that everyone gets more payments under disability
or everyone gets more payments under food stamps. It is a very
haphazard process, and there is great unfairness. The technical
term is horizontal inequity. That is to say, if I am lucky
enough to be with a caseworker who says, ``Oh, let us forget
about this income,'' or if I am lucky enough to be with a
caseworker who says, ``Well, you deserve it even though you
don't formally fall into the rules.'' That is just unfair. And
the thing about automated systems is it becomes less possible
for there to be that kind of unfairness. I think that is very
important.
The second thing--and I am struck by this--is the
possibility to do serious reform of the system as a whole and
especially its disincentives to work. I was struck by the
comments of my colleagues and also Mr. Doggett about the
earnings limitations, the set-asides. Let me mention a few
things about that and talk for the 2 minutes I have left about
the U.K.
These programs are all interconnected. About 36 percent of
SSI households also receive food stamps. If SSI goes down $1,
food stamps go up, I think, 33 cents, if I remember my math on
this. If SSI goes up, food stamps go down. And this has to be
done by hand. I was going to say across Committee
jurisdictions, but it is really across agencies at the State
and local level. We are in the 21st century. We shouldn't have
to do it that way.
The U.K. has a process of making real-time eligibility
determinations. And it is striking only when you think about
U.S. Government actions, because, of course, when you use a
credit card to buy something, it is real time. And so the idea
that we can't match what is happening in the U.K. is striking.
What the U.K. has been able to do (because it had a process
of systematizing eligibility across programs), is to deal with
the work disincentives embedded in these programs, whether it
is the income set-aside, whether it is an earnings disregard,
and whether it is the effect of food stamps.
As you probably know, depending on the family, and
depending on the income, marginal tax rates in this country for
means-tested programs can be over 100 percent, which is you
earn 1 more dollar, and you owe the government more than $1. In
the U.K., they have been able--and it started under the Labor
government, not just the Conservative/Liberal Democrat
coalition--to reduce the maximum marginal tax rate to 65
percent. Many of us wish it was not that high. But I think this
is the promise of modern technology.
I hope that this Committee will be able to pursue this
topic this year and in the years to come. Thank you very much.
Chairman DAVIS. Thank you, Mr. Besharov.
[The prepared statement of Mr. Besharov follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Chairman DAVIS. The trend in some means-tested programs
like food stamps has been to waive complex eligibility rules,
especially asset tests, in order to speed eligibility
determination and expand benefit receipt. In the manufacturing
world that I grew up in, in business, we call that expediting,
where you step aside from established processes and rules, and
in the long run you can actually create more cost. And thus,
the more you process, the higher your cost per item until it
completely flips the cost structure upside down on what we call
customer service or the equivalent of a banking transaction.
States, especially when spending Federal, not State,
dollars, seem less interested in making the administrative
effort needed to effectively verify income and asset levels,
thus suggesting they need a stake in this game as well. But as
a result, today one in seven Americans is eligible for food
stamps at a cost of over $70 billion in 2011, three times what
it was in 2002 when the asset test was more consistently
applied.
Listening to all of your testimony today, it appears
technology solutions exist to overcome these administrative
barriers, or islands of excellence in various parts of
government and out in the State, but not connected in an
integrated manner yet. For asset verification under AFI, banks
are responding in an average of 7 days, with more than a
quarter reporting back in 24 hours, which is a big step
forward. Meanwhile, the United Kingdom is moving to a system
with real-time wage data.
Mr. Soczynski or Mr. Besharov, are any of the issues and
solutions we have talked about today unique to the SSI program
versus other programs? Go ahead, Mr. Soczynski.
Mr. SOCZYNSKI. No, actually they are not. And I think that
is the applicability of the Medicaid solution in similar
environments. The connection between the government agency and
the financial institutions to share that account balance
information is applicable and transferable to other such
programs.
Chairman DAVIS. Mr. Besharov.
Mr. BESHAROV. I think that is right. I agree. The one thing
I would add to that is something that you mentioned, Mr. Davis,
and that is the fact that States share in the cost of
eligibility and administration, but not in the cost of the
actual program. That is a formula to encourage cutting back on
eligibility determination. Not only does the State save money
that way, but easier eligibility brings more money into the
State.
One thing I would like to also mention, since these rules
are different across programs, TANF to food stamps to
disability, and other programs as well, (housing), you
incentivize States to game the system. Many people wonder why
the TANF program hasn't grown in this time of economic
difficulty. There are many reasons; who is affected,
unemployment rates, and so forth. But I think one very big
reason is States pay all of TANF costs. They pay none of food
stamps cost. And so why should we be surprised if the food
stamp caseload has gone up and the TANF caseload has not? And
the same for the disability caseload. So these incentives that
are built into the system create distortions that we should all
be uncomfortable with.
Chairman DAVIS. Ms. Colvin and/or Mr. O'Carroll, in your
interactions with other agencies, do you see the same types of
issues? In fact, have any other agencies approached you, or
have you shared your experience with others in terms of trying
to streamline the integration of processes?
Ms. COLVIN. I have found that there is a very strong
interest among other agencies. Let me speak first to the State
level, though, because I came out of the State. I administered
all of the means-tested programs at the State level.
The States are very interested in innovation and
creativity. They are interested in automation. For them it has
been a big resource issue. Unlike at the Federal level, where
you have one agency administering the program, many of these
programs are administered at the local level in addition to the
State.
But at the Federal level, we have a Benefits Processing
Work Group. We have presented AFI to them. They are very
interested. I think the standardization of data that you are
proposing will be helpful.
But we have been working with most of the benefit-paying
agencies like VA and CMS and the Office of Child Support
Enforcement. And there is a very strong interest, and we are
continuing to work with them in that regard.
Chairman DAVIS. Mr. O'Carroll.
Mr. O'CARROLL. Mr. Chairman, I agree that working with the
other departments and other agencies on this is very important,
and woven into this are the matching agreements between all the
agencies.
We can't compare data with other agencies that are doing
the same type of work that we are doing, trying to identify
income and wages and other information. We can't do that
without a matching agreement. It takes years, and usually by
the time we get the agreement, the issue is over. So anything
you can do to help us in terms of getting access to data
without computer-matching agreements between Federal agencies
to identify improper payments will be very helpful.
Chairman DAVIS. Thank you very much.
Mr. Doggett, you are recognized for 5 minutes.
Mr. DOGGETT. Thank you, Mr. Chairman, and thanks to all of
our witnesses.
Commissioner, let me ask you, I referenced in my opening
statement this proposal that has been approved in an
Appropriations Subcommittee to cut the billion dollars from
what the President proposed for the Social Security
Administration. What is the impact of that on your efforts to
reduce waste, fraud and abuse, and on all of your program
integrity activities?
Ms. COLVIN. Let me just summarize what the impact is going
to be for us. There is going to be a severe impact within the
agency. I don't have the specifics under the proposal, but it
should be recognized that we had significant cuts in 2011 and
2012. As you know, we have had to close offices and reduce
office hours. We have had a hiring freeze on. We have lost
about 7,000 employees over the 2 years, and we are making other
draconian cuts. We would have similar experiences under this
bill.
There is also going to be a significant reduction in our
program integrity dollars. We have indicated that we already
see a return of $9 for every $1 with our continuing disability
reviews, and $6 saved for every $1 spent with our
redeterminations. The bill significantly reduces the amount of
funding that would be available for that work, reducing it from
$756 million in fiscal year 2012 to $272 million in 2013. So
that is going to be a significant reduction in our ability to
do program integrity work.
But more importantly, the service to the public is going to
take longer. It is not going to be the quality that we have
been able to provide in the past. I don't have at this time
specifics relative to this proposal, but you can conclude that
the impacts will be very similar, if not even worse.
Mr. DOGGETT. We had the Social Security Commissioner
himself at the Social Security Subcommittee the other day
talking about the impact this would have on disability
determinations; for example, where we have big backlogs and
delays already that the Social Security Administration had been
working to try to reduce, that now, without adequate resources,
there will not be the quality of service.
You actually have already, as you mentioned, had to close
some offices. And we can foresee more of that type of thing if
you don't have the money to deliver the service. And this is
coming from some of the same type of people that are always
talking about waste, fraud and abuse, and yet the resources
needed to ensure we don't have waste, fraud and abuse are being
denied to the Administration, which I think is a very
significant shortcoming.
Thank you for your testimony.
Ms. Ford, I would like to ask you about another program
that I mentioned in my opening statement, and that is the Work
Incentives Planning and Assistance program that is about to
expire. Would you review the type of assistance it provides and
comment on if it is not renewed, what the effect will be on
those who rely on it.
Ms. FORD. Yes, thank you.
The grants from the WIPA, or Work Incentives Planning and
Assistance, go to local nonprofit and other agencies to support
outreach, education, and benefits-planning services for people
who are using SSI or the disability benefits under Title II
about work incentives and supports for finding, maintaining,
and advancing in employment. So this is all aimed at assisting
people in getting work, staying at work, or even increasing
their work effort or advancing in their employment.
Beneficiaries are informed about what will happen with
their employment and what kind of medical coverage they can
get. It addresses the concerns that beneficiaries have, their
fears about whether they will lose the protections that they
have in terms of medical coverage. It is basics benefits
counseling: what will happen if you work; what will happen if
you attempt work, are not able to continue, and have to come
back into the program; or if you are able to be successful and
continue on into the work world. It was designed to provide
that one-on-one assistance to people who want to try to leave
the rolls.
Mr. DOGGETT. Those are individuals that may not always be
the first choice of an employer to take a job, and individuals
that may be taking their first job or have had difficulty
getting a job who really need that assistance. It is good for
the employer and the individual employee.
Ms. FORD. Correct, yes.
Mr. DOGGETT. Thank you very much.
Ms. FORD. I agree.
Chairman DAVIS. I thank the gentleman.
The chair now recognizes Mr. Paulsen form Minnesota for 5
minutes.
Mr. PAULSEN. Thank you, Mr. Chairman.
Let me ask Mr. O'Carroll a question, because in your
testimony you mentioned that SSA should conduct certain
redeterminations and limited issue reviews when it discovers
changes in circumstances that might affect an SSI recipient's
eligibility or benefit amount.
Are there any other ways that SSA can help determine if an
SSI beneficiary has additional income or resources besides the
beneficiary just simply telling SSA this information and then
SSA trusting that self-reported information?
Mr. O'CARROLL. Mr. Paulsen, a very good point. Since it is
self-reported, a lot of times SSA isn't finding out about it,
and needs to use other forms of data matches and indicators.
Some of the things that we have been looking at or we
recommend that SSA be doing is, one, taking a look at its own
records; taking a look at the master earnings file, comparing
that against recipients to see if they are showing any income
and taking a look at the earnings suspense file to see if there
are any earnings that are being reported there.
But then the other major thing SSA could be doing is
dealing with the IRS, getting 1099 information from IRS, which
would show that people are getting access to pensions, other
forms of wages, gambling income, that type of information. So
that is very important. And then also matching data with the
States.
So it keeps coming back to all the government agencies need
to be talking to each other and comparing this type of
information.
Mr. PAULSEN. Good.
And then the Unemployment Insurance program is also a
program that is under this Subcommittee's jurisdiction. It has
a 12 percent error rate, with more than $13 billion in improper
payments that went out last year. So in that program the
largest source of error involves individuals going back to work
without then reporting that they are going back to work, and
then continuing to actually receive benefits. That is a
situation that is a little bit similar to the SSI overpayment
discussion.
Mr. Soczynski, is there any potential in your system to
help identify wages?
Mr. SOCZYNSKI. Not specifically in our system. The
information that is provided by the banking industry is account
balance information. However, Accuity and one of our partners,
Early Warning, is involved in a research project with the
Department of Labor at this point attempting to find easier
ways to find out if someone has gone back to work while still
claiming unemployment benefits faster than is reported through
the current data-generation system now.
That pilot should be kicking off shortly. It will involve
three States participating in that: Maryland, Illinois, and
Missouri. And we expect that by the end of the year, we will
have some information on whether or not--not necessarily
through our AFI program, but through an identification of other
databases--if we can identify people back to work sooner than
they are going in to claim that they are no longer needing
unemployment benefits.
Mr. PAULSEN. Mr. Besharov, maybe you can answer. Are there
other programs that you see that need timely and accurate wage
information? Do you have any other thoughts? How should they
get it in the future?
Mr. BESHAROV. Well, I think, first of all, it would help to
have one fundamental reform, which is what Chairman Davis said,
which is have the States have some skin in the payment process,
not just the administration process. That would focus some
attention and deal, I think, with some of the issues about
encouraging modern information technology. We need the States
to want the system to work better. And it is not just audits
that will do it. They have to feel that it costs them money to
have inaccurate systems.
It is the case across many of these means-tested programs--
food stamps come to mind. You mentioned UI. WIC is another
program. About 53 percent of all newborns receive WIC benefits.
And this is supposed to be a program for just those who are
nutritionally needy. At some point it would be good to have
better evidence and better information about student loans,
student grants. It goes across the board where you see we have
given up the process of enforcing the rules, and we are now
having to catch up for almost 40 years of inaction. We started
thinking people would just tell us when their income changed.
And I just want to mention this before closing. People
don't believe this, but there was a President who said, we
don't need any of this recordkeeping. People should just tell
us what they need, and we will send them a check. The
President's name was Richard Nixon. It was the last time we
talked about a benefit that had no double-checking of actual
wage information, and it is time for us to double-check as best
we can across all means-tested programs.
Mr. PAULSEN. Thank you, Mr. Chairman. I yield back.
Chairman DAVIS. I thank the gentleman.
The chair now recognizes the distinguished chair of the
Republican Policy Committee, the gentleman from Georgia, Mr.
Price.
Mr. PRICE. Thank you, Mr. Chairman. I appreciate that.
This is an interesting panel. I don't envy any of you who
have the responsibility for administering this. I think 40
years is probably the accurate timeframe for when we put in
place a program that is extremely, extremely difficult to make
work on a day-to-day basis.
Ms. Colvin, you referred to that in your opening comments,
and I want to commend you for that.
Our hearing is entitled ``The Use of Technology to Improve
the Administration of SSI's Financial Eligibility
Requirements.'' I think if you break that down, what that means
is that we all want to make certain that those who should be
receiving benefits are receiving benefits for which they are
eligible, and those who shouldn't don't. That is the unanimity
that I think you talked about.
So if I step back from this and would ask you, challenge
you to step back, if the slate is clean, what are the one or
two things that you think are imperative to making a system
work that allows us to utilize the technology of today to
assist in the administration of SSI's financial eligibility
requirements? If you wipe the slate clean--
Ms. Colvin, any thoughts about that, if you were not
encumbered by the current system?
Ms. COLVIN. Well, I think that having standard definitions
of what is income and are resources would be important. The
complexity of being able to each month look at someone's
circumstances, whether or not they have had income that month
or if their resources have changed, is very, very complex. We
have to look at whether or not they received benefits from
someone else who may have contributed to their care. So it is
the whole complexity of the program.
We have in the past presented ideas to simplify the
program, but I think the automation that we are using which
allows us to be able to do this without having to do it
manually, where we can do data exchanges--we have 1,500 data
exchanges with local and State government, we have many with
our Federal agencies so we can compete--that has helped us.
But it is the complexity of the program. If we could find
some way to simplify so we do not have to look at these changes
every single month. Many times we are looking at it
retroactively. For instance, if we give the correct check to
someone for SSI, we give it to them at the beginning of the
month, but they may get income during the month, and then that
makes them overpaid. So it is the complexity of the program. We
need to find a way to simplify it.
I would be very happy to provide some ideas for the record,
but I am not certain I can come up with any off the top of my
head right here.
Mr. PRICE. Mr. O'Carroll, one or two silver bullets?
Mr. O'CARROLL. Well, the first one, as my esteemed
colleague just brought up, is reducing the complexity of it.
With the alerts and these matches where we are either using
third-party databases or other government information, it still
requires that the claim rep at SSA, when they get that
information, develop it, talk to the person, and find out what
the truth is. And that is a whole other step that is needed. So
no matter what we are doing in terms of data-matching, it still
comes down to human intervention in that interview. And that is
part of the issue of complexity.
Mr. PRICE. Mr. Soczynski, one silver bullet.
Mr. SOCZYNSKI. One silver bullet. Well, thinking that I had
the opportunity to listen to a few ahead of me, but clean
slate, back to the future? You know, we have silos. We have so
many disparate databases in so many places that trying to pull
all that together into a big interface, you know, that is the
future. That is the Star Wars of the technology is to really
find a way to reduce the multiple places the information is
filed State by State, agency by agency, and try to get it all
connected, because the data is all there. It is a way of just
having it available for the right person to use at the right
time.
Mr. PRICE. Ms. Ford, do you agree?
Ms. FORD. In addition to what Commissioner Colvin had said,
I would say updating the income and asset levels to reasonable
amounts, at least to the level they would have been were they
indexed to inflation since the beginning. We are spending----
Mr. PRICE. I don't know if that is a clean slate item, but
I appreciate that perspective. I am running out of time, but I
want to get Mr. Besharov up, if I may.
Ms. FORD. My main point is we are spending an enormous
amount of administrative resources to chase nickels and dimes.
Mr. PRICE. Sure. Absolutely.
Mr. Besharov.
Mr. BESHAROV. I lead a program on comparing what we do to
other countries. The social democracies of Europe and Asia are
a little bit complexifying the program to simplify it. So they
have a category called ``temporary disability.'' And the thing
about temporary disability, it is easier to get people on, but
it is easier to get them off.
The other thing they have is they have partial disability.
And so it is easier for them to help someone find a job because
they don't have these earnings penalties. Some people are just
partially disabled. We need room for that in the system in a
way so that the rehabilitative side of the program, which we
haven't talked about, has some way to play out.
So that would be my blank slate.
Mr. PRICE. Thank you, Mr. Chairman.
Chairman DAVIS. I think the gentleman.
And the chair now recognizes the distinguished gentleman
from Georgia, Mr. Lewis, for 5 minutes.
Mr. LEWIS. Thank you very much, Mr. Chairman. Again, thank
you for holding this hearing. I want to thank all of the
witnesses for being here.
Director Ford, what can Congress do to help SSA and the
disability community to give support to disabled recipients so
that they can return to work when they are able to do so? I
guess this is in keeping with the line of questions that my
good friend from Georgia Dr. Price raised.
Ms. FORD. Well, I think that making it easier to go back to
work, increasing those income and asset limits so that you are
not hitting against those complexities in the program every
time you earn just a little bit of money. Those complexities
frighten people. Hitting overpayments every time you earn even
a little bit of money is very difficult.
And being creative, we need to look at making it easier for
people to work. The SSI program does have work incentives in
it. It needs to make it simpler, though, so that people are not
frightened when something happens.
We do already have a way, through the section 1619 program,
for people to maintain their eligibility for Medicaid so that
they don't lose that support system. And very often people who
have very severe disabilities need to maintain their long-term
services coverage (or their long-term care coverage) through
the Medicaid program. That is very, very important. We are
talking about people with very severe disabilities here. So
that is very important.
Simplification of work incentives is critical, because
otherwise it becomes too complex. We are talking about a
program that is already very, very complex. And for people who
are eligible for both Title II and Title XVI, the complexities
become almost too great to surmount. The rules are very
different.
Mr. LEWIS. Thank you.
Commissioner, the SSI program rules are very complicated.
You probably know that better than anyone. They are very
complicated. Apart from new technology are there ways to
simplify the rules to make the SSI program less burdensome to
administer and easier for a recipient to understand? How can
you make it simple?
Ms. COLVIN. I don't have an immediate response to that
because it is so complex. We would be very happy to work with
you on ideas that might be worth exploring. But each time a
change is made, probably for a good reason, it makes the
program even more complex. So if you just were to roll out all
of the changes that have been added on to the program over the
last 40 years, each one of those makes it more and more
complex. When you have to look at someone's income and
resources every single month, and regardless of how small that
change is, it impacts or may impact their benefit, it becomes
very difficult.
Mr. LEWIS. You don't have a way in this new age of
technology to just push a button?
Ms. COLVIN. No, we don't have that. We do, as I said, have
a lot of data exchanges, so we are able to get information
about wages from IRS or the Administration for Children and
Families, new hire directory, and some of the other pensions
that they receive, et cetera. But, for instance, if someone's
living situation changes, they have to report that. There is no
button that we can push. And once they report it, we then have
to verify it. So it is a very complex process.
Even with the reports that we get, for instance, like AFI,
which is considered a third-party report, we have to verify
that. We can't just accept that. So it is a very complex
program.
Mr. LEWIS. Anyone else have any suggestion, or
recommendation, or some magic, I guess you call it a silver
bullet?
Yes, Director Ford.
Ms. FORD. I would mention that in my testimony we did
comment on Social Security's proposal for a work incentive
simplification project (WISP) which is aimed at Title II, but
might be able to help those people who are concurrent
beneficiaries of Title XVI and Title II who want to try to
work. WISP is one initiative that we would support moving
forward on.
Mr. BESHAROV. If I could, just to give a plug again for
what this Committee has been doing. I sat in on a planning
session at the Labor Department, and somebody asked the
question, why was it so difficult and so expensive to do
research on workforce development programs? And the head
researcher from the Labor Department said, ``Because for each
contract, the contractor has to spend $1 million collecting the
data from the States.'' And someone said, ``Well, doesn't data
come to you, the Department of Labor?'' ``No,'' says the
Department of Labor, ``and when it comes, we can't use it
because it is all in different kinds of pieces.''
So it sounds so unromantic, but I think the work that this
Committee is doing on data simplification, data similarities,
and codification is the first essential step to much more data-
sharing electronically. It is very important. It seems so
mundane, but it is tremendously important.
Mr. LEWIS. Thank you.
Thank you, Mr. Chairman.
Chairman DAVIS. I thank the gentleman.
Ultimately, if we are going to address the deficit and
spending issues, it is going to be by fixing the engine and not
external or symptomatic changes. We are hopeful. These
technologies exist today all around us. It is a question of
removing the statutory barriers, which the Inspector General
and I have talked about in the past and others. But I
appreciate the conversation so far.
With that, we recognize Mr. Berg from North Dakota for 5
minutes.
Mr. BERG. Thank you, Mr. Chairman. I thank the panelists. I
appreciate the passion that is coming out and what we are doing
here, which really does seem mundane and boring, but can have
pretty dramatic effects.
As you know, the pressure to reduce error rates is
critical. And the return, the payback is pretty dramatic.
Obviously, the challenge is if we can prevent an overpayment
from happening, that is a lot easier than trying to recoup
money after that money has gone out, for people trying to
understand why that error was made and for people trying to
correct that whole process.
So I guess just really on the big picture, Mr. O'Carroll, I
would like you to tell us what the most common SSI issues are
that result in overpayment, and are they preventable?
Mr. O'CARROLL. Mr. Berg, as I was saying in earlier
testimony, the biggest issue is the self-reporting of SSI
recipients. When you are talking about your assets, what is
your income, what your property is, all those are the biggest
issues. SSI is a means-tested program, and you have to trust
the person is giving you the right information. I think what we
are talking about today is finding ways to verify that
information the person has given and if any of the
circumstances have changed.
Mr. BERG. So how would you prevent that? I am assuming that
when it relates to property, that is probably a big issue that
could have a wide variation of opinions on what the value is or
if there is value. What jumps out and says, this is where it is
really hard to determine?
Mr. O'CARROLL. Well, the biggest part of determining
eligibility is the redeterminations that we have been talking
about. When those indicators come up, that is the point when
you have to bring in the recipient and speak to them and find
out whether or not they have the resources. And unfortunately,
one of the big issues with the resources of SSA is that we need
a balance there between stewardship and service. And what we
are saying is we need to have more resources put toward
stewardship. So when you get those indicators, you are bringing
the people in, you are checking to see if their circumstances
have changed.
And I think that is one of the issues that we would like
this Committee to help with is for SSA to be given an integrity
fund or a fund that is earmarked just for stewardship work
where, when resources are limited, that there will always be
the resources there to do the redeterminations, the continuing
disability reviews, the cooperative disability investigations
that we do, that is probably the best prevention, Mr. Berg.
Mr. BERG. Thank you.
I yield back, Mr. Chairman.
Chairman DAVIS. I thank the gentleman.
The chair now recognizes Mr. Reed from New York for 5
minutes.
Mr. REED. Thank you, Mr. Chairman.
And thank you to the witnesses for your testimony today.
Ms. Colvin, I wanted to follow up on some prior testimony
from the change in priorities that we have received from the
Commissioner in prior hearings that I see in this area at SSA.
And there was some direct testimony from the Commissioner about
the fact that he was processing incoming eligibility cases over
the post-entitlement checking and making sure that overpayments
are getting looked at and corrected. Has that been the case in
your experience in the agency; has that priority shift
occurred?
Ms. COLVIN. I don't think there is a priority shift. We try
to balance both of the workloads, both our program integrity
and our direct service. If you have someone who walks into an
office, you have to serve them. Or if someone calls you on the
telephone, you have to serve them. And then that work is not
finished. You have to take action as a result of that call or
that visit. So certainly that moves to the front of the pile,
but I think clearly we have tried to balance that.
Now, we do all of the redeterminations and the CDRs for
which we are funded, and we are certainly doing other kinds of
things like our Centenarian Project and other kinds of projects
that we try to use to identify any overpayments or anyone who
is getting a benefit who should not. So I would say it is a
continuous effort to balance the workload.
Mr. REED. So when the Commissioner came and testified to us
in previous hearings that there was a conscious decision on his
part to switch the priority to incoming eligibility claims at
the expense of post-entitlement work, the Commissioner's
testimony was inaccurate?
Ms. COLVIN. Now, I can't speak to that because I am not
aware of that testimony, so I am certainly not going to
contradict what he would say. But I am responsible for the
program integrity initiative in the agency, and I have not seen
that getting shifted. We have been pushing that as we always
have.
Mr. REED. So from your experience at the agency, that
priority shift has not occurred?
Ms. COLVIN. I would say since I have been there, there is
still a focus on program integrity work.
Mr. REED. Wait. But that didn't answer the question. Was
there a shift--there is always a focus on everything you do?
Ms. COLVIN. I can't speak to whether or not there has been
a shift. I don't know what timeframe that testimony was given.
I would be very happy to provide you an answer for the record.
But I am not aware that there has been a shift of not doing
program integrity work and instead doing----
Mr. REED. Incoming eligibility determination.
Ms. COLVIN. Right, right.
Mr. REED. That is fair.
And then I was going to ask, one of the issues I see here
is that the qualification for the benefits changes, as we point
out, as you pointed out, are midmonth many a times, and as the
individual is eligible for the benefits, things change. Has
there been any exploration of technology? I know there is some
testimony, Mr. Besharov, from you, in the U.K. there is
realtime reporting wage technology that is out there that the
U.K. is relying on. Is there anything in the agency's point of
view, Ms. Colvin, warranting to get to that realtime data?
Ms. COLVIN. Thank you for that question. Yes, we have the
SSI telephone wage reporting where an individual can call in
and report any change in their wages during the month. Right
now it is a telephone call. We are moving that application to
both mobile phone services as well as Internet services. We
want to make it as easy for people to be able to report changes
as possible. We think that will go a long way.
Mr. REED. Now, that is self-reporting from the individual.
I understand in the U.K.--and I will move over here to Mr.
Besharov--the U.K. realtime data, that is different?
Mr. BESHAROV. That comes from the employer. And so as soon
as there is a change, the employer sends the information to Her
Majesty's Revenue and Customs.
Mr. REED. My understanding, I mean, I had four small
businesses before I came to Congress, and I was doing my weekly
deposits, I was doing my payroll, and right there you have it
all listed. You have your Social Security number. Is there a
roadblock between the IRS and that reporting data, that instant
wage, weekly deposits that are occurring, not getting over to
SSA to simply check what is happening during that midstream?
Ms. COLVIN. Right now the wage reporting from the IRS is
yearly. We have had proposals in to do it quarterly, but there
has been concern about the impact on small businesses.
Mr. REED. Now, what impact on small businesses? They are
already reporting the data from a majority of the cases.
Ms. COLVIN. Well, they would have to report it more
frequently to the IRS to be able to report it to us. We get a
yearly report. It is usually about 18 months, I think, by the
time we get it, so the information is old when we get it. And
we do, in fact, then go back and make changes as a result of
that, but you have already incurred overpayments.
We are entering into a contract with--and I don't remember
the name of it now--that would allow us to have a contract with
large----
Mr. REED. Ms. Colvin, if I could reclaim my time. Because
that is not my understanding of the process of how it works.
And when I sign those payroll statements, and when I deposit
it, is that an accurate statement that the wage reporting
information is only prepared at the end of the year for the
IRS?
Ms. COLVIN. I said we only get it at the end of the year.
Mr. REED. You only get it. But if you got it earlier--well,
my understanding is the IRS does get that information earlier.
It gets it on a weekly basis with the deposits. So if you got
that information earlier, would that help you with this issue?
Ms. COLVIN. Absolutely.
Mr. REED. And would you advocate for that?
Ms. COLVIN. I would advocate for getting it sooner,
absolutely. And as I was mentioning, we are entering into an
agreement with an organization called The Work Number, which is
a large payroll provider for employers that will, in fact, make
information available to us more immediately. These are your
large employers like Walmart and some of the other kinds of
businesses.
So we are just beginning to look at that. We think that
will also help us to get the wage data sooner than we currently
are able to get it. But anything that would allow us to get
that information sooner would, in fact, allow us to reduce the
overpayments.
Mr. REED. And you would be supportive of that?
Ms. COLVIN. Yes.
Mr. REED. Okay. Thank you.
Chairman DAVIS. The gentleman's time has expired.
And the chair now recognizes Mrs. Black from Tennessee for
5 minutes.
Mrs. BLACK. Thank you, Mr. Chairman.
And I want to thank the panel for being here today. It has
been very instructive. And I want to follow through on what my
colleague was just talking about.
Mr. Besharov, I want to go to you and talk a little bit. If
you can ferret out a little bit more, in looking at best
practices--and I think that is something we always should be
doing is looking at how somebody else is doing, and do they
have a better widget or a better way of doing it than what we
do--can you ferret out a little bit more for me on what the
U.K. is doing that we would like to model? What would be a good
thing?
Mr. BESHAROV. Thank you.
I think first and foremost they have identified that people
who are labeled as disabled have different levels of
disability, and with social help many of them can work. And I
think that is an important social idea.
I had lunch this afternoon with the senior assistant to
Iain Duncan Smith, who I think you had here a few weeks ago at
a hearing. They have just conducted the next phase of their
review. Seventy percent of the disability recipients in the
U.K. were found to be either not disabled or only partially
disabled. And the idea is not to throw them off, but to help
them.
So I think one thing we can learn from this is that our
system, which was created a long time ago--part of our
disability system we inherited as we tried to create something
from the States--if we looked at this and compared it to what
other countries are doing, I think we would decide, number one,
that there are things called temporary disabilities, and the
advantage of a temporary disability is that people don't have
to wait a year or more to get on benefits because we are not
worried that it is a permanent decision. The decision can be
reviewed a year or 6 months later. It is much easier to review
a decision when an initial decision was only temporary. It is
easier to turn that decision around.
Second, there are different levels of disability, and it is
not just a question of allowing people to work, but giving them
a little bit of a nudge. We think your disability is such and
such; we think you can earn a certain amount. And if we look at
other countries, what we see is the incentives that they create
on top of those rules can often be very powerful.
A person who goes to work in the Netherlands from a partial
disability, designated having a partial disability, is able to
earn more than the amount the disability payment would have
been. Now, we say, well, that is just going to cost us money,
but it turns out that that moves so many more people into work,
that the government ends up saving money.
We should be able to ask these questions, and the only way
you could ask them and answer them is to have modern data
systems and have a system that understands that it is not just
asking people if they want to work. We have to encourage them a
little, and we have to give them the financial incentives if
they take a job that we will respect the fact that they took a
job.
Mrs. BLACK. So looking at the analysis and the data from
the U.K., can we then assume from that that they have less
people who stay consistently on their SSI? Do they have people
moving in and out of the program and, therefore, a total number
that is less than what we have here in the United States? Is
that an assumption we can jump to or not?
Mr. BESHAROV. I don't know enough about the program, but I
wouldn't jump to that conclusion. If we look at other countries
like the Netherlands, which had a much larger problem, we know
that when these rules are imposed, the total number of disabled
goes down. But in this country it really would depend on what
the error rates are and whether the incentives would help
people who are only partly disabled.
I know this is only anecdote, and there are experts around
the table, but I come from the welfare world, and I can tell
you what I am told. If someone spends 6 months, a year, or 2
years getting on a disability program, and then the first thing
that happens is they get a letter saying, well, why don't you
go look for a job--am I right about that? And so what I am told
is there is a certain, wait a minute, now, I am not going to
mess up what I waited so long to get.
So I think part of the problem is the structure of the
program which creates such a high hurdle to get in that it is
difficult to get out.
Mrs. BLACK. I know my time is going to run out here. The
other question that I would have--and each of the panel
members, this would be something for you as well. I know you
are not going to have time to answer it. You may be able to do
that followup in writing for me--but in just breaking down
silos, which silos would you need to break down to have a
system that you feel would be working together, where you would
have the right hand knowing what the left hand is doing?
I think that my colleague had already rooted that out in,
Ms. Colvin, you getting information more quickly. So there is a
silo there that needs to be broken down so that it can--and you
all have been doing a good job, and in reading this notebook I
want to commend you on that, but we still have a ways to go.
So thank you so much, Mr. Chairman, and I yield back the
remainder of my time.
Chairman DAVIS. I thank the gentlewoman. I want to thank
all of you on the panel for your thoughtful perspectives on
these issues. We appreciate you investing the time to come in
and talk about the experience in SSI that can be transferable
to other means-tested programs.
If any Members have additional questions, they will get
them to you directly. We would ask that you submit them. They
will send them to you in writing. If you would submit your
answers also to us for the record so they can be inserted for
all to see, we would appreciate that.
Chairman DAVIS. Thank you again for being here, and this
hearing is adjourned.
[Whereupon, at 4:21 p.m., the Subcommittee was adjourned.]
[Submissions for the Record follow:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]