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 [email protected]. 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,
2003

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
[email protected].

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.

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