    Social Security Administration: Agency Is Positioning Itself to
    Implement Its New Disability Determination Process, but Key
    Facets Are Still in Development (15-JUN-06, GAO-06-779T).

    In March 2006, the Social Security Administration (SSA) published
    a rule that fundamentally alters the way claims for disability
    benefits are processed and considered. The rule establishes the
    Disability Service Improvement process (DSI)--intended to improve
    the accuracy, timeliness, consistency, and fairness of
    determinations. DSI's changes include an opportunity for an
    expedited decision during the initial determination process and
    the elimination of the Appeals Council, which had given claimants
    the right to appeal administrative law judge (ALJ) decisions
    before pursuing federal court review. DSI replaces the council
    with a Decision Review Board, which will selectively review ALJ
    decisions. However, dissatisfied claimants whose cases are not
    selected for board review must now appeal directly to the federal
    courts. Based on its ongoing work, GAO was asked to testify on
    (1) public and stakeholder concerns about the elimination of the
    Appeals Council and its replacement by the Decision Review Board
    and SSA's response to these concerns, as well as (2) the steps
    that SSA has taken to help facilitate a smooth implementation of
    the DSI process.
    -------------------------Indexing Terms-------------------------
    REPORTNUM:   GAO-06-779T
        ACCNO:   A55559
      TITLE:     Social Security Administration: Agency Is Positioning
    Itself to Implement Its New Disability Determination Process, but
    Key Facets Are Still in Development
         DATE:   06/15/2006
      SUBJECT:   Administrative law judges
    	     Appeals process
    	     Claims processing
    	     Claims reconsiderations
    	     Disability benefits
    	     Federal social security programs
    	     Program management
    	     Program implementation

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    GAO-06-779T

         * Background
         * Concerns Include Fear of Increased Court and Claimant Hardsh
              * Public and Stakeholders Anticipate a Larger Caseload for Cou
              * Public and Stakeholders Anticipate Increased Hardship for Cl
         * SSA Has Taken Constructive Steps to Implement the New DSI Pr
              * SSA Has Moved to Hire and Train Staff, but It Faces Short Ti
              * SSA Has Readied eDib for the Boston Region, but Time for Res
              * SSA Is Improving Its Quality Assurance System as Part of DSI
              * SSA Has Employed Other Change Management Practices to Implem
         * Concluding Observations
         * GAO Contact
         * Staff Acknowledgments
              * Reviewing and Analyzing Comment Letters
              * Identifying and Interviewing Stakeholders
         * PDF6-Ordering Information.pdf
              * Order by Mail or Phone

    Testimony

    Before the Subcommittee on Social Security, Committee on Ways and Means,
    House of Representatives

    United States Government Accountability Office

    GAO

    For Release on Delivery Expected at 11:00 a.m. EDT

    Thursday, June 15, 2006

    SOCIAL SECURITY ADMINISTRATION

    Agency Is Positioning Itself to Implement Its New Disability Determination
    Process, but Key Facets Are Still in Development

    Statement of Robert E. Robertson, Director Education, Workforce, and
    Income Security Issues

    Social Security Administration Social Security Administration Social
    Security Administration Social Security Administration Social Security
    Administration Social Security Administration Social Security
    Administration Social Security Administration Social Security
    Administration Social Security Administration Social Security
    Administration Social Security Administration Social Security
    Administration Social Security Administration Social Security
    Administration Social Security Administration Social Security
    Administration Social Security Administration Social Security
    Administration Social Security Administration Social Security
    Administration Social Security Administration Social Security
    Administration Social Security Administration Social Security
    Administration Social Security Administration Social Security
    Administration Social Security Administration

    GAO-06-779T

    Mr. Chairman and Members of the Subcommittee:

    Thank you for inviting me today to discuss stakeholder concerns about
    various aspects of the Social Security Administration's (SSA) new
    Disability Service Improvement process (DSI) and the steps that SSA has
    taken to address these concerns. SSA is preparing to implement its new
    process first in its Boston region for at least 1 year beginning in August
    2006.

    In July 2005, SSA issued a notice of proposed rule making to obtain public
    comment on DSI proposals that would fundamentally redesign the way claims
    for disability benefits are processed and considered, with the purpose of
    improving the accuracy, consistency and fairness of its disability
    decisions, and making correct decisions earlier in the process. After
    reviewing comments submitted in response to its notice, SSA issued its
    final rule in March 2006, codifying many of its proposed changes. One of
    the many changes envisioned under DSI is the elimination of the Appeals
    Council, which had afforded claimants the ability to appeal unfavorable
    decisions made by administrative law judges (ALJ) to SSA before filing
    suit with a federal court. Once DSI is fully implemented, decisions made
    by the ALJs become the final agency decision, unless they are selected for
    review by a new Decision Review Board. The cases selected for review will
    be those identified through use of a statistical model as claims that are
    complex or prone to erroneous decisions. As you know, many have expressed
    concern over the elimination of the Appeals Council as a forum that
    claimants could avail themselves of before resorting to a federal court.

    The information I am providing today is based on work that we conducted
    between February 22, 2006, and June 2, 2006, as part of ongoing work in
    this area, in accordance with generally accepted government auditing
    standards. I will be discussing (1) concerns raised about the replacement
    of the Appeals Council with the Decision Review Board and how SSA has
    responded to them, and (2) steps SSA has taken to help facilitate a smooth
    implementation of the DSI process.

    To conduct our work, we reviewed a large sample (252 in total) of the
    comment letters that were submitted by the public in response to SSA's
    notice of proposed rule making and that focused on the replacement of the
    Appeals Council with the Decision Review Board. In addition, we
    interviewed 10 stakeholder groups-such as claimant representatives,
    employee groups, and disability advocacy organizations that SSA has
    previously consulted with-to learn more about their perspectives on the
    elimination of the Appeals Council as well as on the near-term rollout of
    the DSI process in the Boston region. In addition, we conducted extensive
    interviews with SSA officials and reviewed available agency documents to
    determine their position on and collect data relevant to eliminating the
    Appeals Council, as well as their efforts and plans related to DSI
    implementation. Further, we reviewed our past reports on improving SSA's
    disability process in a number of areas, including human capital; its
    electronic records system-known as eDib; quality assurance; and
    implementing change and managing for success. For a more detailed
    description of our methodology, please see appendix I.

    In summary, we found that the public and stakeholders expressed two
    overriding concerns regarding the replacement of the Appeals Council with
    the Decision Review board-that the workload of the federal courts will
    rise if the council is eliminated and that this change will present
    additional hardship for claimants. In our review of the comment letters
    submitted to SSA that specifically addressed the elimination of the
    Appeals Council, we found that about half expressed concern that petitions
    to federal courts would rise, given the council's termination, and that
    claimants would lose an additional level of administrative review. About
    40 percent of comments highlighted recent improvements in the Appeals
    Council's processes and noted that eliminating the council would not
    improve adjudication. Stakeholder groups we spoke with basically
    underscored these same two points-that eliminating the Appeals Council
    would result in an increase in disability claims cases that are appealed
    in federal district courts and that some claimants may drop meritorious
    claims rather than pursue a seemingly complicated and intimidating federal
    court appeal. Acknowledging these concerns, SSA contends that DSI will
    improve decision making earlier in the process, decrease the time it takes
    the agency to reach a final decision, and reduce the need for appeal. SSA
    also maintains that because DSI affords claimants the right to appeal
    their initially denied claims to reviewing officials who are now centrally
    managed, claimants will not experience an overall loss in administrative
    review at the federal level. At the same time, both stakeholders and SSA
    believe it will be important for the agency to closely monitor DSI in
    order to evaluate its impact on claimants and the courts.

    SSA has made substantial preparation for DSI on all fronts related to
    successful implementation-human capital, technical infrastructure, and
    quality assurance. However, the timetable is ambitious and much work
    remains. While stakeholders have expressed concern that SSA will not be
    able to hire and sufficiently train staff in time for the new process to
    get under way, we found that the agency has, to date, posted hiring
    announcements for new positions and developed training packages for
    onboard staff. SSA is also taking steps, as we had previously recommended,
    to ensure that key technical supports, particularly the electronic
    disability system known as eDib, are in place for Boston staff to
    adjudicate claims under the new process. At the same time, the agency has
    allowed itself very little time to identify and resolve any potential
    glitches that may arise before the Boston rollout in August. Regarding
    quality assurance, SSA has taken several steps to lay a foundation for a
    more cohesive program, as we had recommended in our earlier reports. For
    example, features of the new DSI process-including centralizing quality
    assurance reviews of initial state disability determination service (DDS)
    decisions, establishing a Decision Review Board for hearing decisions, and
    developing several tools to aid decision writing-may address problems with
    decisional consistency that we have identified in the past by allowing for
    a cohesive analysis of decisions. In addition, SSA officials plan to
    monitor and evaluate the execution of the Boston rollout, although some
    performance measures for this initiative, such as for assessing a new
    medical expert system that is part of DSI, are still unclear to us, and
    mechanisms for delivering feedback to staff on the clarity and soundness
    of their decision writing have not yet been fully developed. Finally, SSA
    is undertaking other, broad steps that we consider consistent with
    effective change management strategies that we have previously
    recommended. For example, the decision to implement the new system first
    on a small scale-that is, in one small region-before introducing it
    elsewhere should allow for careful integration of the new systems and
    staff and for working out problems before they become serious impediments
    to success. Additionally, SSA has employed a proactive, collaborative
    approach with the stakeholder community in both designing and implementing
    the new disability determination process.

                                       Background

    SSA operates the Disability Insurance (DI) and Supplemental Security
    Income (SSI) programs-the two largest federal programs providing cash
    benefits to people with disabilities. The law defines disability for both
    programs as the inability to engage in any substantial gainful activity by
    reason of a severe physical or mental impairment that is medically
    determinable and is expected to last at least 12 months or result in
    death. In fiscal year 2005, the agency made payments of approximately $126
    billion to about 12.8 million beneficiaries and their families. We have
    conducted a number of reviews of SSA's disability programs over the past
    decade, and the agency's management difficulties were a significant reason
    why we added modernizing federal disability programs to our high-risk list
    in 2003. In particular, SSA's challenges include the lengthy time the
    agency takes to process disability applications and concerns regarding
    inconsistencies in disability decisions across adjudication levels and
    locations that raise questions about the fairness, integrity, and cost of
    these programs.

    The process SSA uses to determine that a claimant meets eligibility
    criteria-the disability determination process-is complex, involving more
    than one office and often more than one decision maker. Under the current
    structure-that is, DSI notwithstanding-the process begins at an SSA field
    office, where an SSA representative determines whether a claimant meets
    the programs' nonmedical eligibility criteria. Claims meeting these
    criteria are forwarded to a DDS to determine if a claimant meets the
    medical eligibility criteria. At the DDS, the disability examiner and the
    medical or psychological consultants work as a team to analyze a
    claimant's documentation, gather additional evidence as appropriate, and
    approve or deny the claim. A denied claimant may ask the DDS to review the
    claim again-a step in the process known as reconsideration. If the denied
    claim is upheld, a claimant may pursue an appeal with an ALJ, who will
    review the case. At this step, the ALJ usually conducts a hearing in which
    the claimant and others may testify and present new evidence. In making
    the disability decision, the ALJ considers information from the hearing
    and from the DDS, including the findings of the DDS's medical consultant.
    If the claimant is not satisfied with the ALJ decision, the claimant may
    request a review by SSA's Appeals Council, which is the final
    administrative appeal within SSA. If denied again, the claimant may file
    suit in federal court.

    In March 2006, SSA published a final rule to establish DSI, which is
    intended to improve the accuracy, consistency, and fairness of decision
    making and to make correct decisions as early in the process as possible.
    While DDSs will continue to make the initial determination, claims with a
    high potential for a fully favorable decision will be referred to a new
    Quick Disability Determination (QDD) process. If the claimant is
    dissatisfied with the DDS's initial determination or QDD, the claimant may
    now request a review by a federal reviewing official-a new position to be
    staffed by centrally managed attorneys. The federal reviewing official
    replaces the reconsideration step at the DDS level, and creates a new
    level of federal review earlier in the process. The claimant's right to
    request a hearing before an ALJ remains unchanged. However, the Appeals
    Council is eliminated under the new process, and as a result the ALJ's
    decision becomes the final agency decision except in cases where the claim
    is referred to the new Decision Review Board. Claims with a high
    likelihood of error, or involving new areas of policy, rules, or
    procedures, are candidates for board review. 1 If the board issues a new
    decision, it becomes the final agency decision. As before, claimants
    dissatisfied with the final agency decision may seek judicial review in
    federal court. DSI also includes the introduction of new decision-writing
    tools that will be used at each adjudication level, and are intended to
    streamline decision making and facilitate training and feedback to staff.
    In addition, SSA is creating a Medical and Vocational Expert System,
    staffed by a unit of nurse case managers who will oversee a national
    network of medical, psychological, and vocational experts, which are
    together responsible for assisting adjudicators in identifying and
    obtaining needed expertise. In its final rule, SSA indicated that DSI will
    further be supported by improvements, such as a new electronic disability
    system and an integrated, more comprehensive quality system.

    As noted, the changes introduced by DSI were codified in SSA's final rule
    on the subject. Table 1 highlights these new features and associated
    elements.

    1According to SSA, for the first year of implementation in the Boston
    region, the board will review all ALJ decisions.

    Table 1: Key Aspects of DSI

    New feature                 Associated elements
    Quick Disability            Expedited processing for certain clear-cut
    Determinations              cases.
                                   Use of a predictive model to screen for cases
                                   that have a greater likelihood of allowance
                                   and to act on those claims within 20 days.
                                   Nationally standardized training for examiners
                                   in DDS on this process.
                                   Medical or psychological experts must verify
                                   that the medical evidence is sufficient to
                                   determine that the impairment meets the
                                   standards.
    Medical and Vocational      A national network of medical, psychological,
    Expert System               and vocational experts who will be available
                                   to assist adjudicators throughout the agency.
                                   The national network will be overseen by a new
                                   Medical and Vocational Expert Unit.
                                   All experts affiliated with the network must
                                   meet qualifications, which are still under
                                   development.
    Federal reviewing officials A cadre of federal reviewing officials-all
                                   attorneys-can affirm, reverse, or modify
                                   appealed DDS decisions. Federal reviewing
                                   officials cannot remand cases to the DDSs for
                                   further review, but they can ask that the
                                   DDSs provide clarification or additional
                                   information for the basis of their
                                   determination.
                                   Reviewing officials may obtain new evidence
                                   and claimants can submit additional evidence
                                   at this stage. If necessary, the reviewing
                                   official may issue subpoenas for documents.
                                   If a reviewing official disagrees with the DDS
                                   decision, or if new evidence is submitted, he
                                   or she must consult with an expert in the
                                   expert system.
    Decision Review Board       The Decision Review Board will replace the
                                   Appeals Council. It will be composed of
                                   individuals selected by SSA's Commissioner,
                                   and each member will serve a designated term.
                                   The board will review both allowances and
                                   denials, and the board has the ability to
                                   affirm, modify, reverse, or remand ALJ
                                   decisions.
                                   A new sampling procedure-or predictive
                                   model-will identify ALJ decisions that are
                                   error-prone or complex for the board's review.
                                   The predictive model, which is still under
                                   development, is expected to select 10 to 20
                                   percent of ALJ decisions for the board's
                                   review.
                                   The board has 90 days from the date the
                                   claimant receives notice of board review to
                                   make its final decision. If it fails to act
                                   within that period, the ALJ decision remains
                                   SSA's final decision.
                                   A claimant may submit a written statement to
                                   the board within 10 days of receiving notice
                                   that the board will review his or her case,
                                   explaining why he or she agrees or disagrees
                                   with the ALJ's decision. This statement may be
                                   no longer than 2,000 words.

    Source: GAO analysis.

    Note: While DSI does not change the structure or scope of ALJ reviews, the
    new process has several elements that affect hearings at the ALJ level.
    Namely, SSA will notify claimants at least 75 days prior to the hearing of
    the date and time for which the hearing has been scheduled. Additionally,
    claimants have to submit evidence at least 5 business days before the
    hearing date itself.

    Implementation of DSI will begin on August 1, 2006, in the Boston region,
    which includes the states of Connecticut, Massachusetts, Maine, New
    Hampshire, Rhode Island, and Vermont.2 Therefore, only those claims filed
    with SSA in the Boston region on or after August 1 will be subject to the
    new process.3 All claims currently in process in the Boston region, and
    claims filed elsewhere, will continue to be handled under current
    procedural regulations until SSA takes further action.4 In addition, for
    cases filed in the Boston region during the first year of DSI
    implementation, all ALJ decisions-both allowances and disallowances-will
    be reviewed by a new Decision Review Board with authority to affirm,
    modify, reverse, or remand decisions to the ALJ.5 Since DSI will only
    affect new claims initiated in the Boston region, claimants whose cases
    were already in process before August-as well as those filing outside the
    Boston region-will still have access to the Appeals Council.

    Concerns Include Fear of Increased Court and Claimant Hardship, while SSA
                Believes Its New Process Will Reduce the Need for Appeal

    In their written comments to SSA and discussions with us, public and
    stakeholder groups, such as claimant representatives and disability
    advocacy groups, expressed two broad areas of concern regarding the
    replacement of the Appeals Council with the Decision Review Board: (1)
    potential for increasing the workload of the federal courts and (2)
    anticipated hardship for claimants in terms of loss of an administrative
    appeal level and difficulties associated with pursuing their claims in
    federal court. SSA's response to concerns regarding the federal court
    workload is that all changes associated with new DSI process-taken
    together-should reduce the need for appeal to the federal courts. At the
    same time, SSA plans to implement this final step gradually and with
    additional safeguards to minimize the impact on the courts. In response to
    concerns about the loss of appeal rights, SSA contends that under the new
    DSI process, claimants will have a new level of federal review earlier in
    the process, and should experience a decline in the amount of time it
    takes to receive a final agency decision without being overly burdened by
    the Decision Review Board under the new process.

    2According to these regulations, SSA will publish a notice in the federal
    register when it decides to roll out DSI in another region, but this
    notice will not be subject to the formal rule-making process.

    3If a claimant moves to another region from the Boston region, and
    initially filed the claim in the Boston region on or after August 1, 2006,
    the conditions of the DSI process will apply to that claimant no matter
    where he or she moves. If a claimant initially filed elsewhere and then
    moves to the Boston region, the DSI process will not apply to him or her.

    4These procedures can be found in the Code of Federal Regulations, 20 CFR
    404.900-404.999d and 416.1400-416.1499.

    5According to SSA, the predictive model used to identify cases that are
    complex or error-prone will be tested against the board's review of all
    cases during the rollout in Boston. The model will be tested continually
    until it has been proven reliable.

    Public and Stakeholders Anticipate a Larger Caseload for Courts, while SSA
    Maintains That Better Decisions Earlier in the Process Will Reduce the Need for
    Appeal

    Concerns expressed in comment letters to SSA and in our interviews
    revolved largely around the possibility that the replacement of the
    Appeals Council with the Decision Review Board would result in rising
    appeals to the federal courts. Specifically, more than half of the 252
    comment letters we reviewed indicated that the Appeals Council provides an
    important screening function for the federal courts, and that its
    replacement with the Decision Review Board could result in rising
    caseloads at the federal court level. Stakeholder groups with whom we
    spoke reiterated this concern. With the imminent rollout in the Boston
    region, several stakeholders suggested that SSA closely monitor the
    effectiveness of the board and the impact of this change on the federal
    courts.

    Data from SSA suggest that the Appeals Council is both screening out a
    number of cases that might otherwise have been pursued in the federal
    courts and identifying many claims that require additional agency
    analysis. Between 2001 and 2005, the number of disability cases appealed
    to SSA's Appeals Council rose 13 percent. At the same time, the number of
    disability cases filed with the federal courts (both DI and SSI) declined
    9 percent.6 Figure 1 illustrates the volume of receipts at both the
    federal court and the Appeals Council levels during this period.

    6According to data from the U.S. District Courts, claims from 15,416
    disability insurance cases (both DI and SSI), or 6 percent of the court's
    total workload, were filed during the 12-month period ending March 31,
    2005-down from 16,921 in 2001.

    Figure 1: Federal Court and Appeals Council Receipts between 2001 and 2005

    Note: Data on federal court cases are for the 12-month periods ending
    March 31 of the named year. Data on Appeals Council cases are collected on
    a fiscal year basis.

    Further, the Appeals Council consistently remanded about 25 percent of the
    claims it reviewed between 2001 and 2005 for further adjudication by the
    administrative law judge-see figure 2-providing more evidence that the
    Appeals Council is identifying a significant number of claims that require
    additional agency review and modification.

    Figure 2: Disposition of Appeals Council Cases, by Fiscal Year, 2001-2005

    Note: The Appeals Council will deny review if cases do not meet the
    following criteria-there does not appear to be an abuse of discretion by
    the ALJ; there is no error of law; the actions, findings, or conclusions
    of the ALJ are supported by substantial evidence; or the case does not
    present a broad policy or procedural issue that may affect public
    interest. If the Appeals Council denies review, the ALJ decision stands as
    the final agency decision.

    SSA believes that the implementation of DSI as an entire process will help
    it make the correct disability determination at the earliest adjudication
    stage possible and thereby reduce the need for appeal. According to SSA,
    several elements of the DSI process will contribute to improved decision
    making. These include the federal reviewing official position, which
    presents an enhanced opportunity for the agency to thoroughly review case
    records-with the assistance of medical and vocational experts--early in
    the process, as well as new online policy guidance and new tools to aid
    decision writing, which will be used at each adjudication level to
    facilitate consistency and help the agency identify and correct errors
    more quickly. Last, SSA believes that the number of requests for voluntary
    remands that SSA makes to the federal courts is an indicator that the
    Appeals Council is not fully addressing errors in the case or otherwise
    reviewing the case effectively so as to prevent the federal courts from
    reviewing appeals that should have been handled administratively. 7 SSA
    believes the Decision Review Board will more effectively screen cases from
    federal court review by focusing on error-prone claims identified through
    a predictive model.

    SSA acknowledges that the agency cannot predict the likely impact on the
    federal courts' workload and cannot prevent denied claimants from filing
    suit with the federal courts.8 To reduce the likelihood of too many
    appeals reaching the federal court level, SSA stated in its final rule
    that it is pursuing a gradual rollout by implementing the DSI process in
    one small region-the Boston region-and plans to have the board initially
    review all of the ALJ decisions in that region. According to SSA
    officials, the board's review of all ALJ decisions will allow them to test
    the efficacy of the new predictive model, to help ensure that the model is
    identifying the most-error prone cases that might otherwise find their way
    to federal court. Further, SSA officials told us that they are working
    with the federal court system to develop a way to gauge changes in the
    court's caseload. Finally, SSA's internal counsel told us that the agency
    has begun a systematic data collection process to better understand the
    circumstances surrounding remands from the federal court. To date, SSA
    attorneys have analyzed the reasons for federal court remands in more than
    1,600 cases, but they are still working on a quality control mechanism to
    ensure that their information has been entered properly and are therefore
    unwilling to report on the results of their analysis at this time. 9

    7According to SSA officials, request for voluntary remands occur when a
    claimant files an appeal with the federal court and SSA's Office of
    General Counsel determines that the case is not defensible.

    8In the 1990s, SSA conducted a pilot-the Full Process Model-which
    included, among other changes, eliminating the Appeals Council. According
    to SSA officials, although they collected some data on the number of
    direct appeals from the ALJ level to the federal courts, the agency
    discontinued its pilot before collecting sufficient data for a complete
    assessment of the model's impact.

    9SSA officials also indicated that they intend to develop a predictive
    model, to build on current efforts, that identifies error-prone cases
    among those denied by ALJs that are subsequently remanded by the federal
    courts back to SSA for further adjudication.

    Public and Stakeholders Anticipate Increased Hardship for Claimants, but SSA
    Believes the New Federal Reviewing Official Position Will Improve Decision
    Making Earlier

    In their comments on the proposed rule and in subsequent conversations
    with us, stakeholders expressed concern that eliminating the Appeals
    Council would cause claimants hardship both by eliminating the opportunity
    to appeal an ALJ decision to the Appeals Council and by increasing the
    cost and difficulty associated with pursuing cases in federal court.

    In particular, 48 percent of the 252 comment letters we reviewed expressed
    concern that the replacement of the Appeals Council with the Decision
    Review Board would represent a loss in claimant appeal rights within SSA.
    These letters, as well as subsequent discussions with stakeholders,
    emphasized the concern that claimants will not have a say in which cases
    are reviewed by the board. Further, stakeholders were concerned that in
    the Boston region, claimants whose cases were allowed at the ALJ level
    could be overturned by the board, presenting additional hardship for
    claimants as they await a decision.

    In addition, claimant representatives and disability advocacy
    organizations are concerned that appealing at the federal court rather
    than Appeals Council level would be costlier and more intimidating for
    claimants. For example, there is a filing fee associated with the federal
    courts, and stakeholders commenting on SSA's final rule said that the
    filing procedure is more complicated than that required for an appeal
    before the Appeals Council.10 In addition, claimants seeking
    representation must find attorneys who, among other requirements, have
    membership in the district court bar in which the case is to be filed. As
    a result of these hardships, claimant representatives and disability
    advocacy organizations, in particular, were concerned that claimants would
    drop meritorious claims rather than pursue a seemingly complicated and
    intimidating federal court appeal.

    About 40 percent of the comment letters asserted that the amount of time
    the Appeals Council spent adjudicating cases-also referred to as its
    processing time-has improved recently, and letter writers did not believe
    that terminating the Appeals Council would improve the adjudicative
    process. Although SSA has contended that the Appeals Council has
    historically taken too much time without providing claimants relief,
    stakeholders' claims that the Appeals Council processing time has
    decreased significantly in recent years was confirmed by SSA data-see
    figure 3. In light of these concerns, many stakeholder groups we spoke
    with suggested that SSA should roll out the Decision Review Board
    carefully and closely evaluate outcomes from claimants' perspectives.

    10To appeal to the Appeals Council, applicants need only complete a
    one-page form and return it to SSA. For the federal courts, there is a
    $250 filing fee. Although this fee can be waived (based on need), claimant
    representatives and disability advocates assert that the fee may be
    cost-prohibitive for some claimants, and representing oneself at the
    federal court level is challenging.

    Figure 3: Appeals Council Processing Time and Volume of Dispositions, by
    Fiscal Year, 2001-2005

    Note: SSA does not track how many of the cases remanded by the Appeals
    Council result in denials that are appealed again to the council.

    In their final rule and in conversations with us, SSA officials stated
    that the new process still affords claimants comparable appeal rights
    along with the promise of a faster agency decision. Specifically, SSA
    stated that DSI includes two federal levels of thorough case development
    and administrative review-one by the new federal reviewing official and
    another by an ALJ at the hearings level. SSA contends that the new federal
    reviewing official position is a marked departure from the reconsideration
    step, in that the position will be managed centrally and staffed by
    attorneys specifically charged with enhancing the development of a case
    and working with a new cadre of medical and vocational experts to make
    decisions. SSA believes that this new position, along with other changes
    in the new process, will result in many more cases being correctly
    adjudicated earlier in the process, resulting in fewer decisions appealed
    and reviewed by ALJs at the hearings level.

    SSA also argues-recent improvements in processing time
    notwithstanding-that the elimination of the Appeals Council step will
    reduce the length of time it takes the agency to reach a final decision on
    behalf of the claimant. Further, SSA maintains that the replacement of the
    Appeals Council with the board will not be prejudicial to or complicated
    for the claimant. SSA indicated that claimants will have an opportunity to
    submit written statements to the Decision Review Board, thus providing
    another chance to assert their circumstances. SSA maintains that aside
    from the written statement, further action is not required on the part of
    the claimant until the board issues its decision.

    SSA has told us that it plans to monitor stakeholder concerns in several
    ways. For example, SSA plans to track the length of time it takes to reach
    final decisions as well as the allowance rate. SSA also plans to review
    written statements submitted by claimants to help assess the validity of
    the board's predictive model.11

    SSA Has Taken Constructive Steps to Implement the New DSI Process, but Its
              Schedule Is Ambitious and Many Details Are Not Yet Finalized

    SSA has prepared in significant ways for DSI, but the agency's timetable
    is ambitious and substantive work remains. SSA has moved forward in key
    areas that should underpin the new system-human capital development,
    technical infrastructure, and quality assurance. However, some essential
    measures remain under development, particularly for quality assurance.
    Nevertheless, on balance, the agency has begun to employ a number of
    change management strategies we recommended earlier for successful
    transitioning.

    11Specifically, SSA plans to compare the contents of these statements to
    the results of the predictive model. If SSA determines that using claimant
    statements will improve the model, SSA would consider revising the model
    to incorporate information from these documents.

    SSA Has Moved to Hire and Train Staff, but It Faces Short Timetables

    While stakeholders have expressed concern that SSA will not be able to
    hire and sufficiently train staff in time for the new process, we found
    that the agency has taken a number of steps in this area. With respect to
    hiring for new positions, the agency has already developed position
    descriptions and posted hiring announcements for nurse case managers, who
    will work in the new Medical and Vocational Expert Unit, as well as for
    federal reviewing officials. To date, SSA officials have begun assessing
    more than 100 eligible applicants for the reviewing official slots, and
    expect to hire 70 by late June and another 43 in early 2007. SSA officials
    also said they posted announcements to hire nurse case managers, and that
    they expect to hire as many as 90 before the end of the rollout's first
    year in the Boston region.

    SSA officials also said that the agency has posted announcements to hire
    support staff for both the reviewing officials and nurse case managers,
    but the exact number SSA is seeking to hire has not been decided. Several
    stakeholders we spoke with were particularly concerned that SSA will need
    to hire or otherwise provide adequate support staff for reviewing
    officials to ensure their effectiveness. Specifically, several of the ALJs
    we interviewed told us that at the hearings level, judges and their staff
    currently spend significant time developing case files. They noted that if
    the reviewing official position is designed to focus on case development,
    then attorneys in this role will need support staff to help them with this
    time-consuming work.

    With respect to training, the agency has been creating a variety of
    training materials for new and current staff, with plans to deliver
    training at different times, in different ways. SSA officials reported
    working on development of a uniform training package for all staff with
    some flexible components for more specialized needs. Specifically, about
    80 percent of the package is common content for all employees, and 20
    percent will be adaptable to train disability examiners, medical experts,
    ALJs, and others involved in the adjudication process. SSA officials said
    they developed the package with the federal reviewing officials in mind,
    but also with an eye toward a centralized training content that could
    apply to current and new staff down the line. SSA plans to provide the
    full training package, which constitutes about 8 weeks of course work and
    13 modules, to reviewing officials in late June, once all attorneys for
    that position are hired. Among the sessions included are the basics of the
    disability determination process, eDib and its use, medical listings and
    their application, and decision writing.

    Given that the rule was finalized in March and rollout is set for August,
    agency timetables for hiring, training, and deploying more than 100 new
    staff-as well as for training existing examiners-in the six states in the
    Boston region are extremely short. SSA officials have acknowledged the
    tight time frame, but hope to deliver training by using more than one
    medium-in person, online, or by video. SSA still expects to accomplish all
    hiring and training for the Boston region staff in time for an August 1
    launch of the new process.

    SSA Has Readied eDib for the Boston Region, but Time for Resolving Last-Minute
    Glitches before Rollout Will Be Limited

    SSA has also taken steps, as we had previously recommended, to ensure that
    key technical supports, particularly an electronic disability case
    recording and tracking system known as eDib, are in place in time for
    Boston staff to adjudicate claims under DSI electronically. The agency has
    made a variety of efforts to familiarize employees with the system and
    facilitate their ability to use it as early as possible. First, SSA
    positioned the Boston region for a fast transition to eDib by reducing the
    region's paper case backlog. According to a Boston region ALJ, pending
    case records are being converted now to familiarize judges and decision
    writers with the eDib system so they will be comfortable with it when new
    cases reach that level after August 1. Then SSA worked with Boston region
    staff to certify that the region's DDS offices were ready for full eDib
    implementation.

    According to claimant representatives, SSA has also worked to facilitate
    their transition to eDib, and according to SSA officials, the agency has
    developed a system called Electronic Records Express to facilitate medical
    providers' submission of records to SSA. A stakeholder group of claimant
    representatives told us that SSA has offered them training and that they
    have met regularly with agency staff to smooth out eDib issues, such as
    difficulties associated with the use of electronic folders-electronic
    storage devices that replace paper folders as the official record of
    evidence in a claimant's case file. This stakeholders group also reported
    that its members have voluntarily coordinated with SSA to test new
    techniques that might further facilitate eDib implementation.

    SSA has also been developing electronic templates to streamline decision
    writing. ALJs have already received some training on theirs, which is
    known as the Findings Integrated Template. According to SSA officials,
    this template is now used, voluntarily, by ALJs nationwide, after months
    of extensive testing and refinement. For DDS-level decisions, SSA is
    designing a template-called the Electronic Case Analysis Tool
    (E-CAT)-which it expects to be partially operational by July and fully
    implemented by November. DDS examiners in the Boston region will receive
    training on the tool in July and will also receive training prior to then
    on the elements of sound decision making. A similar tool is in development
    for the reviewing officials.

    While SSA officials expressed confidence in having technical supports
    sufficiently in place in time for implementation of DSI in August,
    unanticipated problems associated with new technology may challenge their
    ability to do so. In addition to eDib and E-CAT, SSA is implementing other
    new software systems to support the rollout (such as the predictive models
    and electronic medical records transmission)-any one of which may involve
    unexpected problems. For example, in 2005 we reported that a number of
    DDSs were experiencing operational slowdowns and system glitches
    associated with the new eDib system.12 It remains to be seen whether the
    Boston region experiences similar problems with eDib, or problems with
    other new systems, and whether SSA will be able to resolve technical
    issues that may arise before implementation begins in August.

    SSA Is Improving Its Quality Assurance System as Part of DSI Rollout, although
    Key Elements Have Yet to Be Revealed

    SSA is taking steps to improve its quality assurance system that have
    potential for improving the accuracy and consistency of decisions among
    and between levels of review, in a manner that is consistent with our past
    recommendations. As early as 1999, GAO recommended that in order to
    improve the likelihood of making improvements to its disability claims
    process, SSA should focus resources on initiatives such as process
    unification and quality assurance, and ensure that quality assurance
    processes are in place that both monitor and promote the quality of
    disability decisions.13 Consistent with these recommendations, many of
    SSA's current efforts involve adding steps and tools to the
    decision-making process that promote quality and consistency of decisions
    and provide for additional monitoring and feedback. While these
    developments are promising, many important details of SSA's quality
    assurance system have yet to be finalized or revealed to us.

    12GAO, Electronic Disability Claims Processing: SSA Is Proceeding with Its
    Accelerated Systems Initiative but Needs to Address Operational Issues,
    GAO-05-97 (Washington, D.C.: Sept. 23, 2005).

    13GAO, SSA Disability Redesign: Actions Needed to Enhance Future Progress,
    GAO/HEHS-99-25 (Washington, D.C.: Mar. 12, 1999).

    SSA has recently elevated responsibility for its quality assurance system
    to a new deputy-level position and office-the Office of Quality
    Performance. This office is responsible for quality assurance across all
    levels of adjudication. Listed below are new aspects of the quality
    assurance system that this office oversees and that hold promise for
    promoting quality and consistency of decisions.

               o  SSA will continue to provide accuracy rates for DDS decisions,
               but these accuracy rates will be generated by a centralized
               quality assurance review, replacing the agency's older system of
               regionally based quality review boards and thereby eliminating the
               potential differences among regional reviews that were a cause for
               inconsistent decisions among DDSs.
               o  As part of the DSI rollout, SSA plans to incorporate new
               electronic tools for decision writing to be used by disability
               examiners, federal reviewing officials, and ALJs. The tools are
               intended to promote quality in two ways. First, the tools will
               require decision makers to document the rationale behind decisions
               in a consistent manner while specifically addressing areas that
               have contributed to errors in the past, such as failing to list a
               medical expert's credentials or inaccurately characterizing
               medical evidence. Second, the tools will help provide a feedback
               loop, by which adjudicators and decision writers can learn why and
               under what circumstances their decisions were remanded or
               reversed. SSA officials told us that once the tools are in full
               use, the Office of Quality Performance will collect and analyze
               their content to identify errors or areas lacking clarity. They
               also plan to provide monthly reports to regional managers in order
               to help them better guide staff on how to improve the soundness of
               their decisions and the quality of their writing.14
               o  The establishment of the Decision Review Board, with
               responsibility for reviewing ALJ decisions, is intended to promote
               quality and consistency of decisions in two ways. First, once DSI
               is rolled out nationwide, the board will be tasked to review
               error-prone ALJ decisions with the intent of further ensuring the
               correctness of these decisions before they are finalized. Second,
               during the initial rollout phase, SSA plans to have the board
               review all ALJ decisions to verify that the predictive model used
               to select error-prone cases is doing so as intended. Importantly,
               both the tools and the board's assessment are consistent with our
               prior recommendations that SSA engage in more sophisticated
               analysis to identify inconsistencies across its levels of
               adjudication and improve decision making once the causes of
               inconsistency among them have been identified.15

    14The purpose of this tool is consistent with GAO's prior recommendations
    that SSA develop a more focused and effective strategy for ensuring
    uniform application of SSA's guidance and to improve consistency of
    decisions. GAO, Social Security Administration: More Effort Needed to
    Assess Consistency of Disability Decisions, GAO-04-656 (Washington, D.C.:
    July 2, 2004).

    In addition to these actions, SSA told us it plans to measure outcomes
    related to how DSI is affecting claimants, such as allowance rates and
    processing times at each adjudication stage, and the proportion of cases
    remanded from the federal courts and the rationales for these remands.
    Further, officials told us they will work with the federal courts to track
    changes in their workload. SSA officials also told us they are working to
    monitor changes in costs associated with the new DSI process, in terms of
    both the administrative costs of the process, as well as its overall
    effect on benefit payments. Officials also said that SSA will track the
    length of time it takes the agency to reach a final decision from the
    claimant's perspective, which we have recommended in the past.16 Although
    SSA officials told us that ALJ accuracy rates will be generated from the
    board's review of all ALJ decisions, they said they were not yet certain
    how they will measure these rates once DSI is rolled out nationwide and
    the board is no longer reviewing all ALJ decisions.

    While these developments are promising, aspects of these changes and of
    SSA's plans to monitor the DSI implementation have either not been
    finalized or not been revealed to us. For example, SSA has not yet
    revealed the types of reports it will be able to provide decision makers
    based on the decision-writing tools. In addition, while SSA plans to
    measure the effectiveness of the new process, its timeline for doing so
    and the performance measures it plans to use have not been finalized.
    According to SSA officials, potential measures include how well the
    predictive models have targeted cases for quick decisions at the initial
    DDS level or error-prone cases for the board, and whether feedback loops
    are providing information that actually improves the way adjudicators and
    decision writers perform their work.

    15GAO-04-656.

    16GAO, Observations on the Social Security Administration's Fiscal Year
    1999 Performance Report and Fiscal Year 2001 Performance Plan,
    GAO/HEHS-00-126R (Washington, D.C.: June 30, 2000).

    SSA Has Employed Other Change Management Practices to Implement DSI

    SSA's efforts and plans show commitment to implementing DSI gradually,
    using tested concepts, involving top-level management, and communicating
    frequently with key stakeholders-practices that adhere closely to our
    prior recommendations on effective change management practices.

    With regard to gradual implementation, we had previously suggested that
    SSA test promising concepts in a few sites to allow for careful
    integration of the new processes in a cost-effective manner before changes
    are implemented on a larger scale.17 SSA's decision to implement DSI in
    one small region is consistent with this recommendation. SSA officials
    told us they selected Boston because it represents the smallest share of
    cases reviewed at the hearings level and because it is geographically
    close to SSA's headquarters to facilitate close monitoring. While SSA
    officials acknowledged that unanticipated problems and issues are likely
    to arise with implementation, they assert that they will be able to
    identify major issues in the first 60 to 90 days. SSA officials believe
    this will give them plenty of time to make changes before rollout begins
    in a second region. SSA has also indicated that it plans to roll DSI out
    next in another relatively small region.

    Also consistent with our past recommendations, SSA officials noted that
    some new elements of DSI have been tested prior to integration. For
    example, the ALJ tool for decision writing has been tested extensively
    during development, and they anticipate having fewer challenges when
    similar tools are used more widely. In addition, SSA has said that it has
    rigorously tested its model related to the Quick Disability Determination
    System and that it will continue to check the selection of cases and
    monitor the length of time it takes for quick decisions to be rendered.

    SSA's efforts and plans are also consistent with effective change
    management practices in that they ensure the commitment and involvement of
    top management.18 Specifically, SSA's Commissioner first proposed
    DSI-related changes in September 2003, and the agency began restructuring
    itself soon after the rule was finalized. In addition, SSA created a
    deputy-level post for its new Office of Quality Performance and appointed
    a new Deputy Commissioner in its newly created Office of Disability
    Adjudication and Review, which oversees the hearing and appeals processes.

    17GAO, SSA Disability Redesign: Actions Needed to Enhance Future Progress,
    GAO/HEHS-99-25 (Washington, D.C.: March 12, 1999) and GAO, Correspondence
    to Jo Anne Barnhart, Commissioner of the Social Security Administration.
    (Washington, D.C.: Dec. 19, 2003).

    18GAO, Business Process Reengineering Assessment Guide, GAO/AIMD-10.1.15
    (Washington, D.C.: May 1997).

    We have also encouraged top managers to work actively to promote and
    facilitate change, and SSA appears to be adhering to these principles as
    well.19 For example, SSA officials told us that the Deputy Commissioners
    from SSA's offices of Personnel and Human Capital have collaborated with
    their counterparts in policy units to develop position descriptions and
    competencies for nurse case managers and federal reviewing officials.
    According to SSA officials, these leaders are also collaborating to
    develop interview questions for eligible candidates. Further, SSA
    officials told us their new human capital plan will be released sometime
    in July and that it will emphasize the goals of DSI, as well as the
    personnel changes that will accompany it.

    Finally, SSA's communication efforts with stakeholders align with change
    management principles in several respects. For example, SSA has employed a
    proactive, collaborative approach to engaging the stakeholder community
    both during DSI's design and in its planning for implementation in order
    to explain why change is necessary, workable, and beneficial. Even before
    the notice of proposed rule making on DSI was published, SSA began to meet
    with stakeholder groups to develop the proposal that would eventually
    shape the new structure. Then, once the proposed rule was issued, SSA
    officials told us they formed a team to read and analyze the hundreds of
    comment letters that stakeholders submitted. In addition, they conducted a
    number of meetings with external stakeholders to help the agency identify
    common areas of concern and develop an approach to resolving the issues
    stakeholders raised before rollout began. According to SSA officials
    responsible for these meetings, the Commissioner attended more than 100
    meetings to hear stakeholder concerns directly. Further, SSA recently
    scheduled a meeting for early July with claimant representatives to
    discuss that group's particular concerns about how the new process will
    affect their work and their disability clients. SSA officials told us that
    senior-level staff will lead the meeting and that about 100 claimant
    representatives from the Boston region will attend.

    19GAO/AIMD-10.1.15 and GAO, Results-Oriented Cultures: Implementation
    Steps to Assist with Mergers and Organizational Transformations,
    GAO-03-669 (Washington, D.C.: July 2, 2003).

    In addition, SSA officials have also worked to ensure that there are open
    lines of communication with its internal stakeholders, thereby ensuring
    that disability examiners and staff in the Boston region are knowledgeable
    about DSI-related changes. For example, SSA solicited comments and
    questions from the Boston region's staff about the specifics of the
    rollout and held a day-long meeting in the region, led by Deputy
    Commissioners, to respond to these concerns.

                                Concluding Observations

    For some time, SSA has been striving to address long-standing problems in
    its disability claims process. From our perspective, it appears that SSA
    is implementing the new claims process by drawing upon many lessons
    learned from past redesign efforts and acting on, or at least aligning its
    actions with, our past recommendations. For example, significant aspects
    of the DSI rollout are consistent with our recommendations to focus
    resources on what is critical to improving the disability claims process,
    such as quality assurance and computer support. SSA's incremental approach
    to implementing DSI-taking a year to monitor the process and testing new
    decision-writing tools, for example-is also consistent with our
    recommendation to explore options before committing significant resources
    to their adoption. Thus, the agency is positioning itself to make
    necessary modifications before implementing the new process in subsequent
    locations. Finally, and fundamental to all of this, SSA's top leadership
    has shown a commitment to informing affected stakeholders and listening to
    their advice and concerns with respect to the development and
    implementation of this process.

    While SSA's steps and plans look promising, we want to stress the
    importance of diligence and follow-through in two key areas. The first is
    quality assurance, which entails both effective monitoring and evaluation.
    A solid monitoring plan is key to helping SSA quickly identify and correct
    problems that surface in the Boston rollout, because any failure to
    correct problems could put the entire process at risk. An evaluation plan
    is critical for ensuring that processes are working as intended and that
    SSA is achieving its overarching goals of making accurate, consistent
    decisions as early in the process as possible. The second key area is
    communication. It is important for SSA's top leadership to support open
    lines of communication throughout implementation if the agency is to
    facilitate a successful transition. Failure to, for example, provide
    useful feedback to staff-many of whom will be new to the agency or at
    least to the new tools-could significantly jeopardize opportunities for
    improvement. Just as important, SSA's top management needs to ensure that
    the concerns and questions of stakeholders affected by the new process are
    heard, and that concerned parties are kept apprised of how SSA intends to
    respond.

    The eventual elimination of the Appeals Council and its replacement with
    the Decision Review Board with a very different purpose has been a great
    cause of concern for a number of stakeholders. SSA appropriately has plans
    to assess its impact by tracking decisions resulting from each stage of
    the new process, as well as the effect of the process on the federal
    courts' caseloads and claimants at large. To its credit, SSA plans to
    reduce any immediate impact on the courts by requiring that the board
    initially review all ALJ decisions in the Boston region. However, given
    that the agency plans to rely heavily on new positions, such as the
    federal reviewing official, and on new technology, SSA will need to ensure
    that staff are well trained, and that each adjudicator has the support
    staff needed to work effectively. Focusing on one small region will, it is
    hoped, allow the agency to ensure that training, technology, and other
    resources are well developed to achieve expected goals before DSI is
    expanded to other parts of the country.

    Mr. Chairman, this concludes my prepared remarks. I would be happy to
    answer any questions that you or other members of the subcommittee may
    have.

                                      GAO Contact

    For future contacts regarding this testimony, please contact me at (202)
    512-7215 or RobertsonR@gao.gov. Contact points for our Offices of
    Congressional Relations and Public Affairs may be found on the last page
    of this testimony.

                                 Staff Acknowledgments

    The following individuals have made major contributions to this statement-
    Susan Bernstein, Candace Carpenter, Joy Gambino, Michele Grgich, Luann
    Moy, Daniel Schwimer, and Albert Sim.

    Appendix I: Objectives, Scope, and Methodology

    To learn more about the public's and stakeholders' views with regard to
    the Appeals Council and the Decision Review Board, we reviewed and
    analyzed a large sample of comment letters they submitted to the Social
    Security Administration (SSA) in response to its July 2005 notice of
    proposed rule making on the Disability Service Improvement process (DSI)
    that were related to these topics. We also interviewed a number of key
    stakeholder groups to solicit their opinions once the rule had been
    finalized.

    Reviewing and Analyzing Comment Letters

    To review and analyze the comment letters, we first downloaded all 1,143
    comments that SSA had received and posted to its public Web site. In order
    to focus our review on only those letters that related to the Appeals
    Council and the Decision Review Board, we then applied a word search to
    restrict our analysis to the responses that used the terms "Decision
    Review Board," "DRB," and "Council."20 Applying these search terms reduced
    the number of comment letters for review to 683. We discarded 43 of these
    683 letters over the course of our review because they were duplicates of
    letters by the same authors or did not contain relevant comments. As a
    result, our final analysis was based on the remaining 640 letters.

    To classify the nature of the comments contained in these 640 letters, we
    coded the opinions as related to one of more of the following concerns:

               o  The Appeals Council is improving, and its termination will not
               improve the disability determinations process.
               o  There is a risk that the Decision Review Board may not select
               the most appropriate cases for review.
               o  There is a risk that Decision Review Board could unfairly
               evaluate or influence administrative law judge decisions.
               o  In the absence of an Appeals Council, the claimant no longer
               has the right to initiate subsequent case review.
               o  There is no opportunity for the claimant or his or her
               representative to argue before the Decision Review Board.
               o  A claimant's benefit might be protracted or delayed during
               Decision Review Board assessment.
               o  Petitions to the federal court are likely to increase.
               o  Appeals to the federal court are costly or intimidating, and
               claimants may not have the wherewithal to pursue the claim at this
               level.

    20It is possible that statements could have been made about the Appeals
    Council and Decision Review Board that did not use these terms, and that
    we could have missed. If so, the number of responses related to these two
    entities could be greater than we are reporting.

    Of the 640 letters in our review, we initially identified 388 as form
    letters, or letters containing identical comments, even though they had
    different authors. To simplify our review, we coded these form letters
    separately from the other letters. For the 252 letters that we did not
    initially identify as form letters, one analyst reviewed and coded each
    letter, while a second analyst verified that he or she had coded the
    statements appropriately. If the first and second analysts did not come to
    an agreement, a third analyst reviewed the comment and made the final
    decision for how the content should be classified. Table 2 below indicates
    the percentage of the 252 letters citing one or more of the above
    concerns.

    Table 2: Share of Comment Letters Including Each of the Concern Categories
    Included in This Study

                                                            Percentage of comment
                                                       letters expressing concern
    Concern category                                                 (n = 252)
    Petitions to the federal court are likely to                            53
    increase.
    In the absence of an Appeals Council, the                               48
    claimant no longer has the right to initiate
    subsequent case review.
    The Appeals Council is improving, and its                               38
    termination will not improve the disability
    determinations process.
    Appeals to the federal court are costly or                              37
    intimidating, and claimants may not have the
    wherewithal to pursue the claim at this level.
    There is no opportunity for the claimant or his                         28
    or her representative to argue before the
    Decision Review Board.
    There is a risk that the Decision Review Board                          25
    may not select the most appropriate cases for
    review.
    There is a risk that Decision Review Board                              22
    could unfairly evaluate or influence
    administrative law judge decisions.
    A claimant's benefit might be protracted or                             18
    delayed during Decision Review Board
    assessment.

    Source: GAO analysis

    For the 388 form letters, we coded one letter according to the process
    described above. Because the text of the form letters was identical for
    each, we then applied the same codes to each of the other form letters.
    All 388 form letters expressed each of the concerns above.

    Identifying and Interviewing Stakeholders

    To identify key stakeholders, we first referenced the list of
    organizations that SSA included in its notice of proposed rule making as
    having met with the agency during its development of the final rule. We
    then narrowed this list by obtaining suggestions from SSA officials about
    organizations that are the most active and cover a broad spectrum of
    disability issues. In total, we spoke with representatives from 10 groups:

               o  Administrative Office of the U.S. Courts' Judicial Conference
               Committee on Federal-State Jurisdiction,
               o  Association of Administrative Law Judges (AALJ),
               o  Consortium for Citizens with Disabilities' Social Security Task
               Force (CCD),
               o  National Association of Councils on Developmental Disabilities
               (NACDD),
               o  National Association of Disability Examiners (NADE),
               o  National Association of Disability Representatives (NADR),
               o  National Council of Disability Determination Directors (NCDDD),
               o  National Council of Social Security Management Associations
               (NCSSMA),
               o  National Organization of Social Security Claimants'
               Representatives (NOSCCR), and
               o  Social Security Advisory Board.

    Related GAO Products

    Social Security Administration: Administrative Review Process for
    Adjudicating Initial Disability Claims. GAO-06-640R . Washington, D.C.:
    May 16, 2006

    Electronic Disability Claims Processing: SSA Is Proceeding with Its
    Accelerated Systems Initiative but Needs to Address Operational Issues.
    GAO-05-97 . Washington, D.C.: September 23, 2005

    Managing for Results: Enhancing Agency Use of Performance Information for
    Management Decision Making. GAO-05-927 . Washington, D.C. September 9,
    2005

    High-Risk Series: An Update. GAO-05-207 . Washington, D.C.: January 2005

    SSA's Disability Programs: Improvements Could Increase the Usefulness of
    Electronic Data for Program Oversight. GAO-05-100R . Washington, D.C.:
    December 10, 2004

    Social Security Administration: More Effort Needed to Assess Consistency
    of Disability Decisions. GAO-04-656 . Washington, D.C.: July 2, 2004

    Electronic Disability Claims Processing: SSA Needs to Address Risks
    Associated with Its Accelerated Systems Development Strategy. GAO-04-466 .
    Washington, D.C.: March 26, 2004

    Human Capital: A Guide for Assessing Strategic Training and Development
    Efforts in the Federal Government. GAO-04-546G . March, 2004

    Social Security Administration: Strategic Workforce Planning Needed to
    Address Human Capital Challenges Facing the Disability Determination
    Services. GAO-04-121 . Washington, D.C.: January 27, 2004

    Results-Oriented Cultures: Implementation Steps to Assist Mergers and
    Organizational Transformations. GAO-03-669 . Washington, D.C.: July 2,
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    Highlights of a GAO Roundtable: The Chief Operating Officer Concept-A
    Potential Strategy to Address Federal Governance Challenges. GAO-03-192SP
    . Washington, D.C.: October 4, 2002

    Social Security Disability: Disappointing Results from SSA's Efforts to
    Improve the Disability Claims Process Warrant Immediate Attention.
    GAO-02-322 . Washington, D.C.: February 27, 2002

    Observations on the Social Security Administration's Fiscal Year 1999
    Performance Report and Fiscal Year 2001 Performance Plan. GAO/HEHS-00-126R
    . Washington, D.C.: June 30, 2000

    Management Reform: Elements of Successful Improvement Initiatives.
    GAO/T-GGD-00-26 . Washington, D.C.: October 15, 1999

    SSA Disability Redesign: Actions Needed to Enhance Future Progress.
    GAO/HEHS-99-25 . Washington, D.C.: March 12, 1999

    Business Process Reengineering Assessment Guide. GAO/AIMD-10.1.15 .
    Washington, D.C.: May 1997

    SSA Disability Redesign: Focus Needed on Initiatives Most Crucial to
    Reducing Costs and Time. GAO/HEHS-97-20 . Washington, D.C.: December 20,
    1996

    SSA Disability Redesign: More Testing Needed to Assess Feasibility of New
    Claim Manager Position. GAO/HEHS-96-170 . Washington, D.C.: September 27,
    1996

    (130584)

    www.gao.gov/cgi-bin/getrpt? GAO-06-779T .

    To view the full product, including the scope

    and methodology, click on the link above.

    For more information, contact Robert E. Robertson at (202) 512-7215 or
    robertsonr@gao.gov.

    Highlights of GAO-06-779T , a report to House Committee on Ways and Means
    Subcommittee on Social Security

    June 15, 2006

    SOCIAL SECURITY ADMINISTRATION

    Agency Is Positioning Itself to Implement Its New Disability Determination
    Process, but Key Facets Are Still in Development

    In March 2006, the Social Security Administration (SSA) published a rule
    that fundamentally alters the way claims for disability benefits are
    processed and considered. The rule establishes the Disability Service
    Improvement process (DSI)-intended to improve the accuracy, timeliness,
    consistency, and fairness of determinations. DSI's changes include an
    opportunity for an expedited decision during the initial determination
    process and the elimination of the Appeals Council, which had given
    claimants the right to appeal administrative law judge (ALJ) decisions
    before pursuing federal court review. DSI replaces the council with a
    Decision Review Board, which will selectively review ALJ decisions.
    However, dissatisfied claimants whose cases are not selected for board
    review must now appeal directly to the federal courts.

    Based on its ongoing work, GAO was asked to testify on (1) public and
    stakeholder concerns about the elimination of the Appeals Council and its
    replacement by the Decision Review Board and SSA's response to these
    concerns, as well as (2) the steps that SSA has taken to help facilitate a
    smooth implementation of the DSI process.

    Concerns regarding the replacement of the Appeals Council with the
    Decision Review Board-raised by the public and stakeholder groups, such as
    claimant representatives-generally fall into two areas: (1) potential for
    increasing the workload of the federal courts and (2) anticipated hardship
    for claimants in terms of the loss of an administrative appeal level and
    difficulties associated with pursuing their claim in federal court. SSA's
    response to concerns regarding the federal court workload is that all
    changes associated with the new DSI process-taken together-should reduce
    the need for appeal to the federal courts; at the same time, SSA plans to
    implement this final step gradually and with additional safeguards to
    minimize impact on the courts. In response to concerns about the loss of
    appeal rights, SSA contends that DSI introduces enhanced levels of federal
    review earlier in the process and that claimants should experience a
    decline in the amount of time it takes to receive a final agency decision.

    SSA has prepared in significant ways for the initial rollout of DSI in its
    Boston region, but the agency's timetable is ambitious and much work
    remains. The agency has moved forward in key areas that underpin the new
    system-human capital development, technical infrastructure, and quality
    assurance-taking actions consistent with past GAO recommendations for
    improving the disability determination process. For example, SSA has taken
    steps to ensure that key technical supports, particularly its electronic
    disability case processing system, are in place-even though it has allowed
    itself little time to address and resolve any glitches that may arise
    prior to implementation. SSA has also taken several steps to lay a
    foundation for quality assurance by centralizing its quality assurance
    reviews, establishing a Decision Review Board for reviewing decisions, and
    developing writing tools that should foster consistency and thorough
    documentation at all phases of the determination process. Further, we
    found that SSA's decision to implement DSI first in one small region prior
    to its introduction nationally is a good change management strategy that
    reflects our earlier recommendations. Additionally SSA has taken a
    proactive, collaborative approach to both the design and the
    implementation of the new determination process. Nevertheless, key facets
    of SSA's plan to monitor and evaluate the Boston rollout remain to be
    developed. For example, performance measures for assessing the execution
    of the rollout are still unclear to us, and mechanisms for delivering
    feedback to staff on the clarity and soundness of their decision writing
    have not yet been fully developed.

    This is a work of the U.S. government and is not subject to copyright
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