SSA Disability Redesign: Focus Needed on Initiatives Most Crucial to
Reducing Costs and Time (Chapter Report, 12/20/96, GAO/HEHS-97-20).
The disability insurance and supplemental security income programs grew
rapidly between 1988 and 1995; the number of beneficiaries increased by
about 50 percent. The Social Security Administration (SSA), which
downsized during that period, has struggled to keep up with the
unprecedented growth in applications for disability benefits and appeals
of disability decisions. The processing of claims has been delayed,
creating hardship for disabled claimants, who often must wait for more
than a year for a final decision. SSA is trying to redesign its
disability claims process to reduce administrative costs and shorten the
time a claimant awaits a decision. This report provides information on
the redesign, specifically (1) SSA's vision for and progress in
redesigning the disability claims process, (2) issues related to the
scope and complexity of the redesign, and (3) SSA's efforts to maintain
stakeholders' support.
--------------------------- Indexing Terms -----------------------------
REPORTNUM: HEHS-97-20
TITLE: SSA Disability Redesign: Focus Needed on Initiatives Most
Crucial to Reducing Costs and Time
DATE: 12/20/96
SUBJECT: Federal social security programs
Claims processing
Human resources utilization
Social security benefits
Disability benefits
Federal agency reorganization
Cost control
Administrative costs
Eligibility determinations
Personnel management
IDENTIFIER: Social Security Disability Insurance Program
Supplemental Security Income Program
SSA Reengineered Disability Program
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Cover
================================================================ COVER
Report to the Chairman, Subcommittee on Social Security, Committee on
Ways and Means, House of Representatives
December 1996
SSA DISABILITY REDESIGN - FOCUS
NEEDED ON INITIATIVES MOST CRUCIAL
TO REDUCING
COSTS AND TIME
GAO/HEHS-97-20
SSA Disability Redesign
(106902)
Abbreviations
=============================================================== ABBREV
ALJ - administrative law judge
AO - adjudication officer
DCM - disability claim manager
DDS - Disability Determination Service
DI - Disability Insurance
DPRT - Disability Process Redesign Team
IWS/LAN - intelligent workstation/local area network
MER - medical evidence of record
NCDDD - National Council of Disability Determination Directors
RDS - Reengineered Disability System (formerly the Modernized
Disability System)
SGA - substantial gainful activity
SSI - Supplemental Security Income
SSA - Social Security Administration
Letter
=============================================================== LETTER
B-265676
December 20, 1996
The Honorable Jim Bunning
Chairman, Subcommittee on Social Security
Committee on Ways and Means
House of Representatives
Dear Mr. Chairman:
This report, prepared at your request, evaluates the Social Security
Administration's efforts and progress in redesigning the disability
determination claims process so as to reduce administrative costs and
the time a claimant waits for a decision.
As agreed with your office, we are sending copies of this report to
the Commissioner of the Social Security Administration and the
Director of the Office of Management and Budget. We will also make
copies available to others upon request.
Please contact Diana S. Eisenstat, Associate Director, at (202)
512-7215, if you have any questions. Other GAO contacts and major
contributors to this report are listed in appendix III.
Sincerely yours,
Jane L. Ross
Director, Income Security Issues
EXECUTIVE SUMMARY
============================================================ Chapter 0
PURPOSE
---------------------------------------------------------- Chapter 0:1
In fiscal year 1995, the Social Security Administration (SSA) spent
$3 billion to pay about $61.3 billion in cash benefits to disabled
and blind recipients and their dependents. These benefits were paid
under the Disability Insurance and Supplemental Security Income
programs--the largest federal programs providing cash benefits to
blind and disabled people. These programs grew rapidly between 1988
and 1995, with the number of beneficiaries increasing by about 50
percent. While downsizing during this time, SSA has struggled to
deal with unprecedented growth in applications for disability
benefits and in appeals of disability decisions. Processing of
claims has been delayed, creating hardship for disabled claimants,
who often wait more than a year for a final decision. Faced with
these challenges, SSA decided that it must redesign its disability
claims process to reduce administrative costs and the time a claimant
waits for a decision.
In 1994, GAO reported that SSA's proposal to redesign its disability
claims process is a valid attempt to address fundamental problems,
but cautioned that many implementation challenges would have to be
addressed. These include new staffing and training demands,
developing and installing technology enhancements, and confronting
entrenched cultural barriers to change. Because of the cost and
large resource investment this effort will consume, the Chairman of
the Subcommittee on Social Security, House Ways and Means Committee,
asked GAO to provide information on the redesign, specifically (1)
SSA's vision and progress for redesigning the disability claims
process, (2) issues related to the scope and complexity of the
redesign, and (3) SSA's efforts to maintain stakeholder support.
BACKGROUND
---------------------------------------------------------- Chapter 0:2
Reengineering is a process recognized as a means to identify and
quickly put in place dramatic improvements. It has been used by
private and government organizations to fundamentally rethink and
radically redesign business processes to improve efficiency and
customer service. Today's experts in business process reengineering
frequently cite certain best practices that increase the likelihood
for success.
While a reengineering project can be large and encompassing, experts
suggest segmenting the project and concentrating, at any one time, on
completing a small number of manageable initiatives with measurable
performance outcomes. This segmentation (1) gives managers better
control over the initiatives and allows a faster response if problems
arise or deadlines are not met and (2) produces results in a short
time frame, which helps maintain support from stakeholders.
Although the time frame to realize the full benefit of a
reengineering project may run from 2 to 5 years, in a government
organization, leadership turnover and frequent changes in the public
policy agenda necessitate redesign in which progress on individual
initiatives can be made in relatively short time periods. Finally,
reengineering best practices call for identifying all stakeholders
and working to get and keep their support. Such support is vital
because stakeholder opposition can jeopardize the success of the
redesign.
In late 1994, SSA released a plan for redesign that was extensive in
scope and complex. It included 83 initiatives (later reduced to 80),
to be accomplished during the 6-year period from fiscal year 1995
through 2000. Of these 80 initiatives, 38 were near-term--to be
completed or be in a research and development or testing phase by
September 30, 1996. To direct this effort, SSA created a centralized
management team, known as the Disability Process Redesign Team. The
team was assisted by top SSA management, various task teams, and the
state and federal employees that decide disability claims.
RESULTS IN BRIEF
---------------------------------------------------------- Chapter 0:3
Although reengineering can reduce administrative costs, save time,
and improve the quality of service in the disability claims process,
the scope and complexity of SSA's many initiatives have put at risk
the likelihood of accomplishing the redesign goals. SSA is about
one-third the way through the 6 years it estimated for redesigning
the process, but has made relatively little progress in meeting its
goals. As of July 1996, SSA had not completed any initiative and
testing had not begun for 14 of the 19 initiatives that contain
testing requirements. As a result, SSA has not made sufficient
progress to know whether specific proposed changes will achieve the
desired results. Further, there have not been concrete and
measurable accomplishments to keep the support of stakeholders.
A number of these initiatives have expanded in scope, thus increasing
the time frames required to complete them. Increasing the time
frames has several disadvantages, such as delaying implementation and
heightening the risk of disruption from turnover in senior
executives. In addition to delays, SSA has also experienced turnover
of senior executives since the beginning of the redesign. Although
it is difficult to determine if this turnover has had a negative
impact on the redesign thus far, continued turnover could result in
possible loss of momentum or change of direction. In a constantly
changing government environment, agencies are less likely to have
continuity of leadership and the same public policy agenda for
projects that last several years or more.
Further complicating SSA's redesign efforts are difficulties in
maintaining much needed stakeholder support. First, some federal and
state employees, as well as the unions that represent them, are
concerned that redesign could mean the loss of jobs. Second, state
employees are concerned about SSA's decision to pay federal employees
at a higher rate than state employees for the same job. And third,
support from state management officials involved in the disability
claims process has been declining steadily.
PRINCIPAL FINDINGS
---------------------------------------------------------- Chapter 0:4
REDESIGN HAS MADE LIMITED
PROGRESS
-------------------------------------------------------- Chapter 0:4.1
SSA's implementation approach is limiting the progress of the
redesign. In prioritizing its redesign initiatives, SSA chose to
work on 38 of them simultaneously--a decision that requires a
significant investment in time and resources. Thousands of federal,
state, and contractor employees throughout the country are engaged in
activities such as designing, developing, testing, and evaluating
processes and developing and delivering training programs. While SSA
had completed six discrete tasks (a subcomponent of an initiative) as
of July 1996, it had not fully completed or implemented any of the 38
initiatives and is behind schedule in meeting its testing milestones.
REDESIGN COMPLEXITY AND
SCOPE POSE PROBLEMS FOR
IMPLEMENTATION
-------------------------------------------------------- Chapter 0:4.2
SSA has encountered significant challenges in implementing some of
the more complex initiatives. For example, SSA considers technology
vital to redesign; it has, therefore, undertaken a complex technology
initiative to more fully automate the processing of disability
claims--from the first contact with the claimant to the final
decision. To carry out the initiative, SSA is purchasing over 50,000
computers, installing a local area network in more than 1,350 office
locations, and developing software. Completion of this key
initiative has been delayed by more than 2 years because of software
development problems and the need for additional testing to assess
redesign changes.
Another complex initiative, which will require completion of several
crucial initiatives, is implementing the disability claim manager
(DCM) position. SSA currently plans to place about 11,000 employees
in this position. DCMs will be expected to gather and store claim
information, develop both medical and nonmedical evidence, share
facts about a claim with medical consultants and specialists in
nonmedical or technical issues, and prepare well-thought-out
decisions. A DCM will be responsible for making the final decision
on both medical and nonmedical aspects of a disability claim. Before
fully implementing the DCM position, SSA must first provide a number
of crucial initiatives, including technology enhancements and a
simpler method for making disability decisions--features that SSA
does not expect to be available for several years. In October 1996,
SSA stated that the decision to implement the DCM will not be made
until valid and reliable testing demonstrates that this position is
viable.
Several of SSA's initiatives are beginning to expand in scope and,
consequently, time. For example, the scope of SSA's initiative to
achieve consistent decisions throughout all stages of the disability
process has expanded considerably. SSA refers to this initiative as
process unification. Initially, the redesign called for developing a
single policy manual for use by all SSA and state employees involved
in the claims process. As SSA worked on the initiative, it realized
that considerably more effort was required. As a result, SSA
expanded this initiative to include (1) conducting the same training
for 14,000 decisionmakers, including doctors and reviewers; (2)
developing a consistent quality review process that balances review
of allowances and denials and applies the same standards at all
stages of the process; and (3) using more consistent medical input
throughout the disability determination process. With these expanded
tasks, full implementation has been extended from September 1996 to
January 1998 or later.
Although SSA may take many years to fully implement its redesigned
process, experts suggest that individual project initiatives should
be completed quickly--generally taking no more than 12 months to
implement--to give managers better control over these initiatives and
allow for faster response to problems that arise. Achieving
measurable results quickly also enables an organization to build
stakeholder support for its initiatives and overall redesign project.
Moreover, the cornerstone of any redesign effort is the commitment
and long-term availability of its senior executives. Redesign
initiatives that take many years to complete face increased risk--the
longer the project takes, the greater the chance that the senior
executives will change. Turnover typically causes project delays and
possible changes in scope and direction. Although SSA recognizes the
importance of management stability and continuity to redesign, it has
already experienced turnover of senior executives since
implementation began. While there is no indication thus far that the
turnover has had a negative impact on redesign, continued turnover
could result in possible loss of momentum or change of direction for
the redesign.
SSA CHALLENGED TO MAINTAIN
STAKEHOLDER SUPPORT
-------------------------------------------------------- Chapter 0:4.3
According to reengineering experts, to the extent possible, managers
of redesign should seek out and gain support from all stakeholders.
SSA has tried to involve stakeholders in the redesign by identifying
more than 140 of them, meeting with them to discuss redesign issues,
and including them on task teams and work groups. Although
stakeholders generally support the need for redesign, SSA has had
problems getting and keeping support from some of them. In fact,
some redesign proposals are beginning to cause major concerns for
stakeholders. We found, for example, that SSA's decision to create
the DCM position to decide claims raised fears that some staff would
lose their jobs. Furthermore, for federal employees selected for the
position, SSA's decision to temporarily promote them to a higher pay
grade raised a major concern for state employees who would be paid
less for the same work.
While SSA recognizes it needs the support of the states to
successfully redesign the disability determination process, support
for redesign from state Disability Determination Service directors
has been declining. In response to a January 1996 survey question
about how the state directors viewed the overall redesign, about 55
percent did not support it, compared with 40 percent a few months
earlier.
RECOMMENDATION
---------------------------------------------------------- Chapter 0:5
To increase the likelihood that SSA's redesign will succeed, GAO
recommends that the Commissioner
-- select those initiatives most crucial to producing significant,
measurable reductions in claims-processing time and
administrative costs--including those initiatives intended to
achieve process unification, establish new decision-making
positions, and enhance information systems--and
-- combine those initiatives into an integrated process, test that
process at a few sites, and evaluate the results--before
proceeding with full-scale implementation.
Other initiatives could be undertaken at a later date when progress
is ensured for the initiatives discussed above and resources become
available.
AGENCY COMMENTS
---------------------------------------------------------- Chapter 0:6
SSA generally agreed with the thrust of GAO's recommendation and
stated it is directing a larger portion of its redesign resources to
crucial initiatives. SSA also plans to conduct an integrated test of
several redesign features. GAO agrees that SSA needs to scale down
its redesign activities and select those initiatives that are most
crucial to reducing claims-processing time and administrative costs.
However, GAO continues to believe that SSA should combine all crucial
initiatives into an integrated process, test that process at a few
sites, and evaluate testing results before proceeding with full-scale
implementation. SSA made some technical comments, which were
incorporated as appropriate. See chapter 4 for GAO's evaluation of
agency comments and appendix II for the full text of SSA's comments.
INTRODUCTION
============================================================ Chapter 1
The Social Security Administration (SSA) manages two major federal
disability programs that provide cash benefits to people with
long-term disabilities--the Disability Insurance (DI) and
Supplemental Security Income (SSI) programs. The DI program was
enacted in 1956 and provides monthly cash benefits to severely
disabled workers. SSI was enacted in 1972 as an income assistance
program for aged, blind, or disabled people. Disability is defined
in the Social Security Act as an inability to engage in substantial
gainful activity (SGA) because of a severe physical or mental
impairment. Both programs use the same criteria and procedures for
determining whether the severity of an applicant's impairment
qualifies him or her for disability benefits.
In 1995, 5.7 million disabled workers and their dependents received
about $40.2 billion in DI benefits; 4.7 million disabled or blind SSI
claimants received about $21.1 billion in SSI benefits. From the 6.8
million recipients in 1988, overall program enrollment has increased
by more than 50 percent. In fiscal year 1995, SSA spent $3 billion
on these two programs, more than half of the agency's total
administrative expenses for the year. Nevertheless, the agency has
acknowledged that it has had difficulty providing a satisfactory
level of service to its disability claimants. The process is slow,
labor-intensive, and paper-reliant.
Despite efforts to manage this workload with shrinking resources, SSA
has not been able to keep pace with program growth. Initial claim
levels remain high, appealed case backlogs are growing, and decisions
are not being made in a timely manner.\1 In fiscal year 1995, about
2.5 million initial disability claims were forwarded to state offices
for disability determinations, an increase of 43 percent over fiscal
year 1990. During the same period, of the applicants requesting an
administrative law judge (ALJ) to reconsider a decision denied at the
initial claim level, the number escalated from about 311,000 to about
589,000, an increase of 89 percent. Furthermore, SSA is concerned
with the amount of time required to process claims--in many cases a
claimant waits more than a year for a final disability decision. As
of June 1996, processing an initial disability claim averaged 78 days
for DI claims and 94 days for SSI claims; the processing time for an
ALJ decision averaged 373 days.
--------------------
\1 Some of our previous work that reports on these conditions
includes Social Security Administration: Effective Leadership Needed
to Meet Daunting Challenges (GAO/HEHS-96-196, Sept. 12, 1996);
Social Security Administration: Backlog Reduction Efforts Under Way;
Significant Challenges Remain (GAO/HEHS-96-87, July 11, 1996); Social
Security Disability: Management Action and Program Redesign Needed
to Address Long-Standing Problems (GAO/T-HEHS-95-233, Aug. 3, 1995);
and Social Security: Increasing Number of Disability Claims and
Deteriorating Service (GAO/HRD-94-11, Nov. 10, 1993).
SSA'S CURRENT ELIGIBILITY
DETERMINATION AND APPEALS
PROCESS
---------------------------------------------------------- Chapter 1:1
Under the current eligibility determination process, DI and SSI
disability claims can pass through from one to five decision points,
at which eligibility is determined. The initial claim, initial state
Disability Determination Service (DDS) decision, reconsideration, ALJ
hearing, Appeals Council, and federal court review all involve
procedures for evidence collection, review, and decision-making. The
decision points within the current disability claims process are
shown in figure 1.1.
Figure 1.1: Current Decision
Process
(See figure in printed
edition.)
To be considered eligible for either program, claimants must meet
SSA's definition of disability. Claimants must also meet work
requirements for DI claims and financial eligibility requirements for
SSI claims. Under both programs, applications for disability
benefits can be initiated at one of SSA's over 1,300 field offices or
through SSA's toll-free telephone system.
SSA field office personnel assist with completing the application;
obtaining medical, financial, and work history information; and
determining whether applicants meet the nonmedical criteria for
eligibility. Field offices forward claimant information, along with
supporting medical evidence, to a state DDS, of which there are 54.
At the DDS, medical evidence is further developed and a final
decision is made as to the existence of a medically determinable
impairment that meets SSA's definition of disability. SSA funds the
state DDS agencies, provides them with guidance for making disability
decisions, and reviews the accuracy and consistency of their
decisions. Claimants who are dissatisfied with an initial
determination may request reconsideration by the DDS. A
reconsideration is conducted by different staff from the original
staff, but the criteria and process for determining disability are
the same.
Claimants who disagree with a reconsideration denial have the right
to a hearing before 1 of SSA's 1,035 ALJs in the Office of Hearings
and Appeals. At these hearings, claimants and medical or vocational
experts may submit additional evidence; attorneys usually represent
the claimants. If denied by the ALJ, the claimant may then request a
review by SSA's Appeals Council. The Appeals Council may affirm,
modify, or reverse the decision of the ALJ; the Council may also
remand the case to the ALJ for further consideration or development.
Finally, the claimant may appeal the Council's decision to federal
court.
WHY SSA IS REDESIGNING ITS
DISABILITY CLAIMS PROCESS
---------------------------------------------------------- Chapter 1:2
SSA faces increasing responsibilities in the future and must manage
its growing workload with fewer resources. SSA has estimated that if
it conducts business as usual, it would need the equivalent of about
76,400 workers to handle its workload by the end of the century.
Instead, SSA expects to handle this work with about 62,000
workers--2,000 fewer than it has today. To successfully manage its
growing workload, SSA knows that it must (1) increasingly rely on
technology and (2) build a workforce with the flexibility and skills
to operate in a changing environment.
Concerned about managing its workload while reducing administrative
costs, saving time, and improving the quality of service, SSA's
leadership decided it needed to redesign its disability claims
process. To improve the process, SSA's leadership turned to business
process reengineering. SSA concluded that redesigning its process
for deciding disability claims was critical to its goal of providing
world-class customer service with fewer resources. In April 1994, we
testified that the redesign proposal for the disability process is
SSA's first valid attempt to address major fundamental changes needed
to realistically cope with the disability determination workload. We
cautioned SSA, however, that many difficult implementation issues
would need to be addressed.\2 These include new staffing and training
demands, development and installation of technology enhancements, and
confrontation with the entrenched cultural barriers to change.
Reengineering is risky by definition, but if done well it can net
positive benefits for the organization. As envisioned, SSA expects
the redesigned process will produce tangible savings. However, the
bulk of these savings will come from more efficient use of federal
and state employees to process disability claims. Greater efficiency
will (1) allow the agency to use its current workforce to accomplish
other pressing activities and (2) avoid hiring to replace all those
who retire or otherwise leave the agency. In addition, SSA expects
the redesign will result in intangibles, such as improved customer
service, an empowered and better-trained workforce, and increased
public confidence in SSA.
When SSA proposed its redesign, it estimated that it would cost $148
million to administer, with the largest portion of these costs
allocated to training activities.\3
However, SSA estimated net savings of $704 million through fiscal
year 2001--the year for which full implementation is anticipated.
SSA also estimated recurring annual savings of $305 million, once the
redesign is fully implemented.
--------------------
\2 Social Security Administration: Major Changes in SSA's Business
Processes Are Imperative (GAO/T-AIMD-94-106, Apr. 14, 1994).
\3 This estimate does not include certain costs, such as those for
developing software and for the salaries of the redesign team
members.
FOLLOWING REENGINEERING BEST
PRACTICES INCREASES LIKELIHOOD
FOR SUCCESSFUL REDESIGN
---------------------------------------------------------- Chapter 1:3
While success cannot be guaranteed, leading private organizations
have used business process reengineering to identify and quickly put
in place dramatic improvements in their operations. The objective of
reengineering is to fundamentally rethink and redesign a business
process from start to finish, so that it becomes more efficient and,
as a result, significantly improves service to customers. There is,
however, no "right" way to reengineer and no step-by-step sequence of
prescribed activities. Reengineering is highly situational and
should be tailored to meet the needs of each organization, according
to reengineering experts.
Nevertheless, today's leaders in business process reengineering
advocate certain critical success features, or best practices, to
help organizations increase the likelihood of success.\4 Case studies
show that reengineering has failed to achieve the desired change, in
part, because managers have not followed best practices. These
practices include concentrating on a small number of initiatives at
any given time for broad-scoped comprehensive projects; developing
and implementing the initiatives quickly; identifying, securing, and
maintaining stakeholder support; and having the organizational
commitment to initiate and sustain the redesign.
Concentrating on a small number of initiatives at any given time is
essential. According to the experts, reengineering should remain
focused to achieve rapid results. Without such focus, an
organization risks becoming overwhelmed. Further, once started, the
scope of the redesign should not be expanded. Trying to work on too
much forces managers to choose among projects, which further dilutes
the time and attention required to quickly move the redesign forward.
Developing and implementing initiatives quickly is also essential.
According to some reengineering experts, the time from concept
formulation to realizing the first release of a reengineered process
should take no more than 12 months. Other reengineering experts note
that while the full value of a redesigned process may take 2 to 5
years, individual initiatives should be accomplished in a year or
less.
Identifying, securing, and maintaining stakeholder support is also an
essential element of redesign. Stakeholders consist of individuals
who are both internal and external to an organization, as well as
groups that can influence the organization in some way. For SSA,
internal stakeholders include the staff within the organization that
will need to adapt to changes in business processes; external
stakeholders include the Congress, state employees, labor unions,
oversight bodies, key interest groups, customers, and others who
oversee, fund, or are affected by SSA's activities. Managers of
redesign should strive to secure and maintain support of all
stakeholders. Without such support throughout redesign, the chances
of success can be jeopardized.
Finally, having the organizational commitment to initiate and sustain
redesign is another essential element. It is paramount to the
success of the redesign. As a top-down process, reengineering
requires strong, continuous, and committed senior executives from the
beginning of the redesign.
--------------------
\4 See the Bibliography for references to reengineering source
documents.
OBJECTIVES, SCOPE, AND
METHODOLOGY
---------------------------------------------------------- Chapter 1:4
The Chairman of the House Subcommittee on Social Security, House Ways
and Means Committee, asked us to provide information on the
implementation challenges facing SSA as it redesigns its disability
claims process. More specifically, in this report, we address SSA's
vision and progress for redesigning the disability claims process,
issues related to the scope and complexity of the redesign, and the
agency's efforts to maintain stakeholder support.
To develop our information, we reviewed extensive literature on the
principles of reengineering. We interviewed officials at SSA
headquarters and its Atlanta Regional Office. We also reviewed SSA's
extensive design, development, testing, and implementation data for
the redesign. We met with the president of the National Council of
Disability Determination Directors (NCDDD), who represents the 54
state DDSs, and obtained state director views on SSA's testing and
implementation activities. We also met with representatives from the
Office of Management and Budget, the American Federation of
Government Employees, and the National Association of Disability
Examiners.
We received formal briefings from SSA and state organizations on
specific projects and activities related to the redesign effort.
These briefings included periodic updates by the director, Disability
Process Redesign Team (DPRT), on the overall redesign direction and
progress; demonstrations on the development of technology
enhancements; and presentations by state employee associations on the
issues, progress, and problems associated with redesign.
We did not assess the validity of SSA's redesign as a means to
improve services to claimants and to reduce administrative costs.
Nevertheless, in the course of our work, we noted that SSA's redesign
includes features that appear sensible for a project of this nature.
Two such features are (1) a single approach for all decisionmakers to
use when making decisions and (2) enhanced technology to support the
redesign.
Our audit work was conducted from July 1995 through September 1996 in
accordance with generally accepted government auditing standards.
SSA'S VISION AND PROGRESS IN
IMPLEMENTING THE REDESIGNED
DISABILITY CLAIMS PROCESS
============================================================ Chapter 2
As with many federal agencies faced with fiscal constraints and
increasing demands for services, SSA recognized the need to
dramatically improve its disability claims process. Consequently,
SSA created an implementation plan for improving its process through
80 initiatives. By September 30, 1996, 38 of those initiatives were
to be addressed.\5
Although SSA has begun nearly all of the initiatives it planned to
have under way during the first 2 years of its implementation plan,
as of July 1996, SSA had (1) not completed any initiative and (2) not
begun testing for 14 of the 19 initiatives that contain testing
requirements.
--------------------
\5 During fiscal years 1995-96, SSA adjusted the number of near-term
initiatives from 40 to 38 and the number of total initiatives from 83
to 80; SSA deleted 3 near-term initiatives and 1 mid-term initiative
because of ongoing initiatives elsewhere in the agency; and SSA added
a near-term initiative to include customer partnership in claims
processing, which provides the opportunity for claimants to obtain
medical evidence.
SSA'S VISION FOR THE REDESIGNED
CLAIMS PROCESS
---------------------------------------------------------- Chapter 2:1
In October 1993, SSA created a Disability Reengineering Project Team
to fundamentally rethink and redesign the disability determination
process, so as to make it more efficient and improve service to
claimants. The team was asked to redesign the process so as to
better use technology to help SSA reduce the costs and time of claims
processing and enable the agency to meet its workload demands with
fewer resources.
The team did the following: analyzed the current process; sponsored
a series of general public and claimant focus groups to understand
the public's preferences relating to service; compared key aspects of
the process with best practices of other public and private sector
organizations; conducted independent research; and solicited ideas
for improving the process from thousands of stakeholders who were
involved in the disability process, including employees, health care
providers, consumer advocates, and legal representatives.
After extensive consultation with individuals and organizations
representing the disabled, the Commissioner, in September 1994,
approved SSA's vision for redesigning the disability claims process.
The redesigned, user-friendly process emphasizes making correct
decisions quickly and efficiently at the earliest possible point.
This process is expected to reduce average processing time: for a
decision on an initial DI claim, the time would be reduced from 78
days to almost 60 and for a decision on an initial SSI claim, from 94
days to about 60. Similarly, the processing time for appealed cases
is expected to be reduced from 373 to 225 days. The steps in SSA's
new process are shown in figure 2.1.
Figure 2.1: Redesigned
Decision Process
(See figure in printed
edition.)
The goal of the redesigned process is to guide all decisionmakers at
all levels to (1) use standards from the same sources for
decision-making and (2) make "correct" decisions in an easier,
faster, and more cost-effective manner at the earliest possible point
in the process. SSA states a correct disability decision is one that
appropriately considers whether an individual meets the factors of
entitlement for disability, as defined by SSA's statute, regulations,
rulings, and policies. According to SSA, correct decisions in the
new process depend on these factors: a simplified decision
methodology that provides a common frame of reference for determining
disability by all decisionmakers in processing claims; consistent
direction and training to all decisionmakers; enhanced and targeted
collection and development of medical evidence; an automated and
integrated claims- processing system that will assist decisionmakers
in gathering evidence; a single, comprehensive quality review
process; and the creation of the disability claim manager (DCM)
position to give claimants direct access to the decisionmaker
throughout the process and the opportunity to discuss any claim
before it is disallowed.
Under the redesigned process, a DCM will be the focal point for
claimant contacts throughout the process and will be responsible for
processing and deciding the initial claim. In the current process,
these responsibilities are shared by federal claims representatives
and state disability examiners. In the redesigned process, the DCM
will take the initial claim, gather and retain claim information,
develop medical and nonmedical evidence, share information with
medical consultants, analyze information, and make the decision as to
whether to allow or deny the claim. If the evidence for the initial
claim does not support an allowance before denying the claim, the DCM
will issue a predecision notice, advising the claimant of what
evidence has been considered and providing the claimant with the
opportunity to submit additional evidence. If no evidence is
provided or if the evidence provided does not support an allowance,
the DCM will deny the claim.
Claimants who disagree with a DCM decision can appeal the decision to
the Office of Hearings and Appeals. When a claimant appeals a
decision, an adjudication officer (AO) will interview the claimant
and become the primary contact during the appeal. This position is
not available under the current process and is being introduced by
SSA to make allowance decisions in less time. The AO will review the
file, identify the issues in dispute, and determine whether there is
a need to obtain additional evidence. The AO will also have the
authority to issue a favorable decision, if warranted, or forward the
completed claim to an ALJ for consideration. If, after careful
review, the ALJ denies the claim, the claimant may appeal the
decision to a federal district court.
Throughout its effort, SSA intends to assess all redesign activities
against the Commissioner's five primary objectives for the redesign.
These are making (1) the process user-friendly for claimants and
their representatives, (2) the right decision the first time, (3) the
decision as quickly as possible, (4) the process efficient, and (5)
the work satisfying for staff.
In November 1994, SSA released an extensive and complex redesign
implementation plan to facilitate turning its vision into reality.
The plan, to be accomplished over a 6-year period--beginning in
fiscal year 1995 and concluding in fiscal year 2000--includes six
lead areas, encompassing 23 process improvement features and three
enablers. The lead areas are
-- process entry and intake,
-- disability decision methodology,
-- medical evidence development,
-- administrative appeals,
-- quality assurance, and
-- communication.
The enablers, critical support structures that SSA contends are
necessary for successful implementation, are
-- developing a single presentation of all policies for determining
disability,
-- technology enhancements, and
-- using third parties to help claimants with application packages,
including completing forms and obtaining the medical evidence
necessary for deciding claims.
See appendix I for a description of (1) the 23 features and more
details on the three enablers and (2) planned completion dates.
MANAGEMENT STRUCTURE FOR
IMPLEMENTING REDESIGN
---------------------------------------------------------- Chapter 2:2
To help direct its redesign effort, SSA established a management
structure to provide leadership, oversight, and continuity throughout
the testing and implementation phase. The relationship between SSA's
redesign implementation team and the Commissioner, principal deputy
commissioner, and executive steering committee is shown in figure
2.2.
Figure 2.2: SSA's Management
Structure for Redesign
(See figure in printed
edition.)
An executive steering committee was formed to meet on a regular basis
to advise the Commissioner on development of the redesigned process
and to ensure the support of SSA's senior management team. The
committee includes the principal deputy commissioner and the director
of the DPRT, as well as senior managers representing SSA, state, and
union components. Some of these include the Office of Disability;
Office of Hearings and Appeals; Office of Budget; Association of
Administrative Law Judges, Inc.; and the Office of Systems
Components.
SSA assembled the DPRT to help direct the implementation of the
redesigned disability claims process. Team leaders work full-time on
the redesign and are responsible for its major components. Within
the major components, designated heads of lead areas will coordinate
planning and oversee implementation. These designees, as well as
DPRT staff who assist them, are drawn from SSA's federal and state
workforce.
Overall day-to-day leadership, control, and coordination of all
redesign implementation activities is vested in the director of the
DPRT. The director, reporting to the Commissioner and principal
deputy commissioner, is expected to establish implementation
priorities, develop specific timelines, and provide oversight to
ensure that implementation decisions are consistent with the vision
for the redesign process.
In addition, task teams were established to address specific
implementation issues within each of the areas. These teams were
directed to address a broad range of planning issues involving
strategic, tactical, and operational matters. In early 1995, 12 task
teams met to formulate and recommend specific actions that should be
undertaken. For each task team, the overall purpose and related
activities are summarized in table 2.1.
Table 2.1
Task Team and Purpose
Task team Purpose
------------------ --------------------------------------
Third-Party Claims Develop ways to expand third-party
(people or organizations) service to
assist claimants in filing disability
application forms and obtaining
medical evidence
Comprehensive Develop disability information packets
Public Information and a comprehensive public information
campaign to (1) create a more user-
friendly process and (2) promote more
effective claimant partnership
Guiding Principles Develop guiding principles for the
of Quality development of the quality assurance
Assurance system
Adjudication Before national implementation,
Officer (AO) develop detailed procedures and a plan
for implementing an AO position,
including operational
responsibilities, limits of authority,
and procedures for testing
Early To speed the decisions on disability
Adjudication/ claims, design an incremental approach
Disability Claim through the creation of (1) workflows
Manager (DCM) for early allowances and denials and
(2) team approaches for claims
processing
Process At all stages of the process, ensure
Unification consistency in deciding disability
claims through consistent application
of laws, regulations, and rulings
Streamlining Identify opportunities for (1)
Medical Evidence streamlining medical evidence
requirements through the use of
technology development and (2)
reducing the burden--on claimants,
providers, and decisionmakers--
associated with development and
evaluation of medical evidence
Increased Claimant Identify opportunities and guidelines
Participation in that encourage active claimant
Medical Evidence participation in evidence collection
of Record (MER) for those claimants who can and will
participate
Training for Ensure that comprehensive training
Claims Examiner materials about the disability program
and MER Providers are available for claims examiners and
providers
Role of the Redefine the role of the medical
Medical Consultant consultant and develop an
implementation plan
End-of-Line Develop an integrated system that will
Quality Assurance comprehensively review and monitor the
quality of decisions
In-Line Quality Develop and implement a system for
Assurance periodically reviewing and monitoring
quality throughout the claims process
----------------------------------------------------------
SSA'S REDESIGN SOLUTION
---------------------------------------------------------- Chapter 2:3
In deciding to redesign the disability claims process, SSA tackled
the entire process rather than using a building block approach,
improving aspects of the process a little at a time. SSA's ambitious
approach led it, in November 1994, to identify 83 initiatives (later
reduced to 80) associated with 23 process features.
SSA chose to prioritize these initiatives by dividing them into three
time frames: near-term (fiscal year 1995 to 1996), mid-term (fiscal
year 1997 to 1998), and long-term (fiscal year 1999 to 2000).
Near-term implementation initiatives are those (1) scheduled to be
fully implemented nationwide by the end of fiscal year 1996 or (2)
for which the research and development or site testing can be
initiated by the end of fiscal year 1996. Mid-term initiatives are
those that are scheduled to be developed and tested in fiscal years
1997 and 1998 and implemented nationwide by fiscal year 1998.
Finally, long-term initiatives are those requiring extensive research
and development that cannot be tested fully before fiscal year 1999
or cannot be fully implemented nationwide before fiscal year 2001.
SSA's near-term initiatives, to be completed or under way by
September 30, 1996, include a rollout of 40 (later reduced to 38),
almost one-half, of the 80. The 38 initiatives were designed to set
the pace for fully implementing the redesign.
Completing the initiatives will require a significant investment in
time and resources. Thousands of federal, state, and contractor
employees will be needed throughout the country for (1) activities
such as designing, developing, testing, and evaluating processes and
(2) developing and delivering training programs. Each initiative
contains its own set of unique and complex circumstances. The six
process features and corresponding near-term initiatives are
summarizied in table 2.2. See appendix I for DPRT's complete
timetable for redesign.
Table 2.2
Near-Term Initiatives (38) SSA Planned
for Fiscal Years
1995 and 1996
Near-term initiatives (fiscal years
Process feature 1995 and 1996)
------------------ --------------------------------------
Process entry and intake
----------------------------------------------------------
Comprehensive Make disability information packets
public information available in conjunction with a
about the comprehensive public information
disability campaign (nationwide)
programs
Starter Test and evaluate use of starter
application application
Claimant chooses Local managers develop arrangements
mode of entry into with third parties, who are capable of
application providing assistance, based on SSA
process protocols for third-party interaction
Test mail-in application
Develop, test, and implement options
for telephone interviews
Claimant Claimants (and their families or
partnership in support networks) who are able
disability claims actively participate in obtaining
processing medical evidence to support their
claims (nationwide)
DCM as single In every region, test ways to
agency contact for facilitate claims representative and
all initial disability examiner interaction
claims-processing (nationwide)
activities
Evidence In all regions, test ways to
development facilitate claims representative and
tailored to disability examiner interaction
claimant regarding the extent of medical
circumstances development
Predecision Publish final regulations and conduct
contact before tests in selected sites on the various
initial denial means of providing (1) predecision
determination notices and (2) opportunities for
personal contact prior to an initial
denial determination
Statement of the Test use of enhanced decision
claim rationale in Reengineered Disability
System (RDS) pilot sites
Disability decision methodology
----------------------------------------------------------
Index of Disabling Develop and test, using existing
Impairments regulatory authority, a means to
replaces Listing identify disability allowances earlier
of Impairments in the process
Ability to perform Assess research needs, develop work
substantial scope, and award research contracts
gainful activity based on the relationship between age
(SGA) (adults) and the ability to adjust to other
work; the development of standardized
approaches to assessing functional
ability; and identification of the
functional requirements of baseline
work
Change the role of Revise regulatory requirements, for
the medical medical consultant sign-off on initial
consultant determinations, so as to make them
consistent with existing statutory
provisions requiring medical
consultant involvement in childhood
disability claims
Identify categories of claims
requiring medical consultant analysis
at all levels of decision-making
Medical evidence development
----------------------------------------------------------
Streamlined and Identify opportunities for which
targeted requests medical evidence requirements can be
for medical streamlined
evidence
Test options for requesting, storing,
and retrieving medical records
electronically
Local managers focus resources on
professional education and medical
relations outreach with the medical
community (nationwide)
Increase customer partnership in
claims processing by providing
opportunity for claimants to pursue
their own medical evidence
Sliding-fee Develop and test options for a
schedule for sliding-fee schedule for medical
medical evidence evidence
Administrative appeals process
----------------------------------------------------------
First level of Initiate case reviews before oral
appeal is the hearing to expedite evidence
administrative law collection and identify possible
judge (ALJ) allowances
hearing
Develop and publish regulations to
test options for using an AO
Publish regulations to test options
for eliminating reconsideration in
connection with testing of predecision
notice and contact
In specified claims, conduct
prehearing conferences to narrow
issues for hearing
Revised role for Develop and publish regulations to
Appeals Council test options for narrowing the scope
of mandatory Appeals Council review
Develop and test options, in
conjunction with a new quality
assurance system, for expanding the
Appeals Council's own motion reviews
Quality assurance
----------------------------------------------------------
Training Provide consistent training and
direction to all disability
decisionmakers (nationwide)
In-line quality Develop and test procedures for
reviews implementing peer review and in-line
monitoring
Test revised in-line quality review
system
End-of-line Develop and implement revised end-of-
quality reviews line review, addressing both medical
and nonmedical accuracy in DI and SSI
claims (nationwide)
Customer Conduct customer and employee surveys
satisfaction in conjunction with local, regional,
surveys and national pilots of disability
process changes
Measurements Measure overall processing time from
the customer's perspective
(nationwide)
Enablers
Process For determining disability, develop
unification and implement a single presentation of
all substantive policies, with
appropriate monitoring and enforcement
procedures (nationwide)
Role of Develop and implement regulations
representatives regarding representatives'
qualifications and standards of
conduct (nationwide)
Conduct outreach to the legal
community regarding disability program
requirements
Technology Implement RDS in pilot sites
Standardize claim file preparation at
all levels (nationwide)
Test the use of video conferencing at
appropriate remote sites
Test redesign features, where
feasible, in intelligent workstation/
local area network (IWS/LAN) sites
----------------------------------------------------------
STATUS OF NEAR-TERM INITIATIVES
---------------------------------------------------------- Chapter 2:4
The time frames established in SSA's November 1994 implementation
plan, "Disability Process Redesign: Next Steps in Implementation,"
sets forth an outside time frame, September 30, 1996, for (1)
completing the near-term initiatives or (2) initiating research and
development or site testing. Nevertheless, the redesign
implementation team was to focus on completing the tasks as early in
the time frame as possible. However, SSA has not met its near-term
goal. While SSA has completed six tasks (a subcomponent within an
initiative) as of July 1996, it has not fully completed or
implemented any near-term initiative and is running behind in meeting
its testing milestones.
As to tasks completed between November 1994 and July 1996, SSA has
(1) disseminated a 1-page disability information fact sheet, (2)
completed program operation instructions for the Early Decision List
and sequential interviewing, (3) revised the disability form 3368 to
collect medical source information, (4) finalized the DCM Workgroup
report, (5) published regulations to test the DCM, the predecision
interview, and the elimination of the reconsideration step in the
current process, as well as began training all decisionmakers on
existing policy for treating physician opinion, pain and other
symptoms, and residual functional capacity,\6 and (6) developed a
research plan for developing a new disability determination
methodology. Furthermore, of the 19 initiatives requiring testing,
which were to be completed or initiated by September 30, 1996, only 5
had testing ongoing as of July 1996; 3 of them--the AO position, use
of mail-in applications, and the single-decisionmaker\7 --were being
fully tested; the other 2 had limited testing under way. Testing on
the remaining 14 has not started. The status of SSA efforts to
complete the 38 near-term initiatives is shown in table 2.3.
Table 2.3
Status of 38 Near-Term Initiatives as of
July 1996
Category of initiatives Number
-------------------------------------------------------------- ------
Completed 0
With activity 33
With no activity 5
With testing planned 19
With ongoing tests 5
With tests completed 0
----------------------------------------------------------------------
--------------------
\6 Residual functional capacity is what the claimant can do despite
his or her limitations.
\7 In November 1995, the DPRT began testing the AO initiative at 9
state locations and, in January 1996, at 17 federal locations. In
May 1996, the DPRT began testing the single decisionmaker at 6 state
locations and 2 federal locations.
SCOPE OF PROJECT AND DIFFICULTY
WITH STAKEHOLDER SUPPORT LIMIT
POTENTIAL FOR SUCCESS
============================================================ Chapter 3
SSA began its redesign by identifying problems with the current
claims process and focusing on initiatives it felt needed to be
undertaken immediately. In its 2-year plan for near-term
improvements, SSA has moved forward with 38 initiatives rather than
keeping its efforts focused on a few initiatives at one time and
striving for rapid process change--a best practice associated with
successful reengineering. Many of the initiatives SSA has undertaken
are complex, requiring more time to complete than it planned. Thus,
the risk of leadership turnover, before the overall project is
complete, is increased. According to reengineering experts,
continuity of senior executive leadership is much more likely for
initiatives of shorter duration.
Further complicating SSA's redesign activities is the difficulty it
has experienced in trying to maintain the support of all its
stakeholders. SSA identified more than 140 stakeholders, many with
conflicting concerns. While SSA has been working to secure their
support for the redesigned process, a number of stakeholders do not
support SSA's approach. Moreover, because none of the initiatives
have been successfully implemented, there are no concrete and
measurable results that enable SSA to demonstrate the merits of its
approach to encourage stakeholder support.
SSA'S REDESIGN INCLUDES SOME
INITIATIVES THAT ARE COMPLEX
AND
LARGE IN SCOPE
---------------------------------------------------------- Chapter 3:1
In deciding to tackle 38 initiatives in the first 2 years of the
redesign, SSA did not follow a best practice--organizations that
successfully manage redesign usually focus on a small number of
initiatives at one time. Nevertheless, SSA decided to take on a
large number of initiatives concurrently. Some of the more important
initiatives--such as technology enhancements, the DCM position, and
process unification\8 --are large and complex. They will require
many years to complete and the commitment and support of numerous
stakeholders.
--------------------
\8 Process unification is an initiative intended to achieve
consistent decision-making throughout all stages of the disability
determination process.
NEEDED TECHNOLOGICAL
ENHANCEMENTS WILL BE A
LONG-TERM AND COMPLEX
UNDERTAKING
-------------------------------------------------------- Chapter 3:1.1
A major part of SSA's redesign is implementing technological
enhancements to improve the disability claims process. The
redesigned process would replace a slow, labor-intensive, and
paper-reliant process with an automated system from first contact to
final decision.
Throughout all stages of the process, all staff will use essentially
the same software to assign claims, schedule appointments, gather and
store information, develop medical and nonmedical evidence,
facilitate decision-making, provide case control, keep fiscal and
accounting information, and manage the information. SSA will also
need to acquire over 50,000 intelligent workstations (personal
computers). This extensive software and hardware acquisition will be
installed on a local area network (LAN), connecting more than 1,350
SSA and state offices throughout the United States. SSA estimates
that it will be 1998 before the hardware is installed in all field
locations.
SSA's software development activities demonstrate the long-term and
complex nature of this initiative. Developing software designed to
allow SSA to move from its current manual process to an automated
process is critical to success. However, the scheduled
implementation of this new software has been delayed by about 28
months because of problems identified during testing. Software
development is further constrained by the lack of firm requirements
for the new disability determination process. For example, SSA
cannot effectively develop software to obtain medical evidence of
records until the DPRT decides how it wants to standardize
information, requested from medical sources, to substantiate
disability claims.
MULTIFACETED DCM INTENDED TO
CONSOLIDATE CLAIMS
PROCESSING
-------------------------------------------------------- Chapter 3:1.2
SSA chose to create the DCM position to consolidate different
elements of the claims determination process. However, recognizing
the scope of the changes involved, SSA determined it needed to
introduce the position gradually; the DCM position would not become
fully operational until fiscal year 2000.
The DCM is a key dimension of SSA's redesign. SSA plans to (1)
establish over 11,000 DCM positions in about 1,350 federal and state
locations and (2) recruit DCMs from its current workforce of about
16,000 federal claims representatives and about 6,000 state
disability examiners. As mentioned earlier, the DCM would be
responsible for making all decisions about a disability claim. This
is a major deviation from current practice: an SSA claims
representative processes the initial claim; then a state disability
examiner and a medical consultant make the medical determination.
The DCM would conduct personal interviews, develop records for
evidence, and determine medical and nonmedical eligibility.
Specifically, the DCM would gather and store claim information,
develop both medical and nonmedical evidence, share necessary facts
in a claim with medical consultants and specialists in nonmedical or
technical issues, analyze evidence, and make the decision whether to
allow or deny the claim. If the initial evidence does not support an
allowance before denying the claim, the DCM will issue a predecision
notice advising the claimant of what evidence has been considered and
provide the claimant with the opportunity to submit additional
evidence. Although DCMs could still call on medical and technical
support personnel for assistance, a DCM alone would make the final
decision on both medical and nonmedical aspects of a disability
claim.
To accomplish all these tasks, the DCM would need a number of crucial
initiatives, such as technology enhancements, process unification,
and a simplified decision methodology. However, SSA acknowledges
that these initiatives will not be implemented soon.
In addition, SSA faces many other challenges before the DCM can
become operational, for example, securing support from state
governments, state and federal labor unions, and congressional
committees; developing training plans; conducting tests at pilot
sites; bargaining with state unions; posting vacancy announcements
for positions; and selecting and training employees.\9 In October
1996, SSA stated that the decision to implement the DCM will not be
made until valid and reliable testing demonstrates that this position
is viable.
--------------------
\9 SSA Disability Redesign: More Testing Needed to Assess
Feasibility of New Claim Manager Position (GAO/HEHS-96-170, Sept.
27, 1996) provides detailed information on implementing the DCM
position.
PROCESS UNIFICATION
OBJECTIVES EXPANDED
-------------------------------------------------------- Chapter 3:1.3
The scope of process unification has increased significantly since
the implementation plan for the redesign was released in November
1994. At that time, the DPRT was primarily interested in developing
a single policy manual--known as the "one book"--of all substantive
policies for determining disability.
Since then, SSA has expanded the scope of its initiative to put
together the one book. Under process unification, SSA hopes to
achieve similar results on similar cases at all stages of the
disability claims process, with consistent application of laws,
regulations, and rulings. SSA's expanded initiative includes (1)
conducting the same training for 14,000 decisionmakers, including
doctors and reviewers, (2) developing a consistent quality review
process that balances review of allowances and denials and applies
the same standards at all stages of the process, and (3) using more
consistent medical input throughout the disability determination
process.
Consequently, process unification will not be completed by September
30, 1996, as initially envisioned, but will be phased in through a
series of incremental changes that could take through January 1998 or
longer to complete.
LENGTHY INITIATIVES PUT SUCCESS
OF REDESIGN AT RISK
---------------------------------------------------------- Chapter 3:2
When undertaking reengineering initiatives, organizations are often
working toward accomplishing a vision for the future; they may invest
several or more years to fully complete all of the initiatives. This
is also true for SSA's redesign initiatives. As mentioned earlier,
experts suggest, however, that organizations that have successfully
reengineered their work processes meet their long-term vision by
implementing discrete projects of relatively short duration. Experts
therefore advocate planning initiatives that can be implemented
within 12 months. Experts also state that achieving quick progress
is the key to maintaining stakeholder support for long-term changes.
Furthermore, redesign in government agencies can be affected by
constantly changing political environments that often restrict the
time available for career officials to achieve program goals.
Consequently, redesign initiatives with relatively short time frames
allow organizations to avoid major disruption because of leadership
changes. Some of SSA's initiatives, however, are beginning to expand
in scope and become lengthy endeavors.
Reengineering experts also caution that lengthy initiatives can
affect the continuity and availability of the agency's senior
executives. Such senior executives are a necessary prerequisite for
successful reengineering. These executives are the cornerstone of
any redesign effort and actively demonstrate the agency's commitment
to initiate and sustain the change. Although SSA recognizes the
importance of management stability and continuity to the redesign
process, it has experienced turnover in three senior executive
positions since implementation began. We did not develop evidence
that such turnover has had a negative impact on SSA's redesign. But
continued turnover could result in possible loss of momentum or
change of scope or direction. Redesign initiatives that take many
years to complete face increased risk--the longer the project runs,
the greater the chance that turnover of leadership will occur.
MAINTAINING STAKEHOLDER SUPPORT
HAS BEEN CHALLENGING
---------------------------------------------------------- Chapter 3:3
Maintaining stakeholder support is critical to reengineering.
Because stakeholders can jeopardize the chances for successful
reengineering if they are not committed to it, managers of redesign
must seek out and secure support from all stakeholders. Stakeholders
have considerable knowledge of the business and organizational
environment and can help rally support from other stakeholders.
SSA identified and tried to involve stakeholders in the redesign, but
has encountered problems obtaining and maintaining their support. In
September 1993, SSA established an executive workgroup to identify
the stakeholders that should be involved in the development and
implementation of redesign. More than 140 stakeholders were
identified from congressional, federal, state, public, and private
groups.
In its November 1994 redesign implementation plan, SSA called on its
federal and state workforce to make the vision a reality. Since
then, some actions taken by SSA have raised major concerns for some
stakeholders--especially salary issues. According to the president
of the American Federation of Government Employees, Local 1923, the
union would have opposed the DCM position if SSA attempted to
implement it as a grade 11. Under a memorandum of understanding
between the union and SSA, those assigned to DCM positions will
receive temporary promotions to grade 12, one grade higher than the
journeyman level for the claims representative position. However,
this action raised concerns for the state DDS directors and their
workforce, many of whom believe that the agreement with the union
will (1) exacerbate the existing salary gap between state and federal
employees and (2) give federal employees a workload that is currently
states' responsibility.
Another stakeholder disagreement arose following deliberations of a
workgroup SSA created to determine how to accelerate testing of the
DCM position. This workgroup was comprised of SSA and DDS
management, claims representatives and disability examiners, and
federal and state union representatives. The workgroup's final
report endorsed SSA's proposal to test 1,500 DCMs over a 3-year
period. Even though DDS representatives were workgroup participants,
they did not support SSA's proposal to test such a large number of
positions. At the conclusion of the DCM workgroup's activities, the
NCDDD presented a position paper to the DPRT director. The paper
stated that the directors would only agree to a pilot test involving
60 state and 60 federal DCMs.
On September 11, 1996, the director, DPRT, stated that SSA plans to
begin training DCMs in January 1997. Federal employees will receive
about 30 weeks of training and state employees about 6. After formal
training is complete, a period of coaching and mentoring will take
place. The total time envisioned for the formal training and the
coaching period is about 18 months. However, as further evidence
that stakeholder support is eroding, the director also said that he
was not sure there will be a DCM test. He explained that (1) of the
16 states that previously agreed to take part in the test, 3 have
decided not to participate and (2) several of the remaining 13 states
are now reconsidering their decision to participate.
Further, SSA has not obtained strong support from a major
stakeholder--the NCDDD. The directors manage over 14,000 state
employees nationwide, of whom about 6,000 are disability examiners.
According to two recent NCDDD surveys, the DDS directors indicated
that many states were not strongly supportive of a number of redesign
initiatives. According to the first survey, conducted in September
1995, only 3 of the 42 respondents,\10 or about 7 percent, strongly
supported redesign. In addition, 17 states, or about 40 percent,
either moderately or strongly did not support SSA's efforts to
redesign the disability process. According to the second survey,
conducted in January 1996, the DDS directors' opinions about redesign
had worsened, in part due to DCM testing. In response to the
question about how the states viewed the overall redesign, 28 of 51
respondents, or about 55 percent, either moderately or strongly did
not support redesign. Further, according to the survey, only 1 of 50
DDS directors thought the DCM position could be implemented
successfully without all the enablers in place. In addition, 24 of
these directors thought the DCM position could never be successfully
implemented.
--------------------
\10 As mentioned in ch. 1, there are 54 DDS offices nationwide.
CONCLUSIONS, RECOMMENDATION, AND
AGENCY COMMENTS AND OUR EVALUATION
============================================================ Chapter 4
Given the high cost and long processing time of SSA's current
process, the agency's redesign, which undertakes a large number of
initiatives at one time, is proving to be overly ambitious. Some
initiatives are also getting more complex as SSA expands the work
required to complete them. This approach is likely to limit the
chances for success and has already led to delays in implementation:
testing milestones have slipped and stakeholder support for the
redesign has diminished.
As of July 1996, activity is under way for most of SSA's near-term
initiatives; however, none is complete and many are behind schedule.
Only about one-fourth of the near-term initiatives that contain
testing requirements have been started. Consequently, SSA has not
made the progress it intended in order to know whether specific
initiatives will achieve the desired results.
Further, many of the initiatives are complex and have expanded in
scope, thus increasing the time frames to complete them. A
disadvantage to extending the time frames and delaying implementation
is that they increase the likelihood that SSA will experience senior
executive changes during the course of the redesign. Moreover, this
delay also means that no concrete and measurable results are
available to maintain stakeholder support.
While any one of the problems discussed in this report could possibly
be managed and handled successfully, SSA currently faces a multitude
of problems that raises questions about the likelihood redesign will
succeed.
RECOMMENDATION
---------------------------------------------------------- Chapter 4:1
To increase the likelihood that its reengineering project will
succeed, given the major delays that SSA has experienced and the risk
of further decline in stakeholder support, we recommend that the
Commissioner of the Social Security Administration concentrate on
accomplishing rapid results through initiatives of smaller, more
manageable scope. This effort should include
-- selecting those initiatives most crucial to producing
significant, measurable reductions in claims-processing time and
administrative costs--including those initiatives intended to
achieve process unification, establishment of new
decision-making positions, and enhancement of information
systems support--and
-- combining those initiatives into an integrated process, testing
that process at a few sites, and evaluating the results--before
proceeding with full-scale implementation.
The valuable experience gained in these initial efforts can then be
used both to improve the redesign and to build support among
stakeholders and potential program beneficiaries. In addition, other
initiatives could be undertaken at a later date, when progress is
ensured for the initiatives described above and resources become
available.
AGENCY COMMENTS AND OUR
EVALUATION
---------------------------------------------------------- Chapter 4:2
In its comments, SSA generally agreed with the thrust of our report
and its recommendation. SSA stated it is directing a larger portion
of its redesign resources to crucial initiatives. Further, SSA plans
to evaluate several key redesign features in early 1997--the single
decisionmaker and predecision interview process, elimination of the
reconsideration stage, and the proposed adjudication officer (AO)
position--in an integrated test. This approach does not, however,
include integrated testing of all the initiatives we and SSA now
consider crucial. Among the initiatives excluded from this testing
approach are process unification, quality assurance, and enhancement
of information systems support.
We continue to believe that SSA, before proceeding with full-scale
implementation, should combine all crucial initiatives into an
integrated process, test that process at a few sites, and evaluate
test results. The approach we recommend is quite similar to one that
was under consideration at SSA in 1995. Under that 1995 approach,
sites were to serve as comprehensive test locations, with the
principal function of integrating and combining all crucial
initiatives, including automation and technology enablers.
In its comments, SSA also expressed some reservations about how
quickly it could complete redesign. SSA stated that while other
organizations could achieve results quickly, such an expectation
regarding SSA's redesign would be unrealistic, given the scope of the
initiatives. But during the course of our work, we identified
several instances of large, complex government and private
organization redesigns in which significant test results were
achieved in a relatively short time. Although testing a fully
integrated process may require considerable effort, quick completion
would both (1) provide valuable information that would assist SSA in
selecting a redesign solution and (2) serve as a concrete
demonstration of progress. These two factors should be helpful in
building support among stakeholders and potential program
beneficiaries. See appendix II for the full text of SSA's comments.
DISABILITY REDESIGN PLANNING
TIMETABLE
=========================================================== Appendix I
Mid-term (fiscal Long-term (fiscal
Near-term (fiscal years years 1999 and
Process feature years 1995-96) 1997-98) beyond)
------------------ ------------------ ------------------ --------------------
Process entry and intake
--------------------------------------------------------------------------------
Comprehensive Make disability
public information information
about the packets available
disability in conjunction
programs with a
comprehensive
public information
campaign
(nationwide)
Starter Test and evaluate Make starter
application use of starter application
application available for all
claimants
(nationwide)
Claimant chooses Local managers Test and implement Give claimant option
mode of entry into develop options for third to file an
application arrangements with parties to assist application
process third parties, who in the completion electronically, by
are capable of and development of mail, by telephone,
providing disability claims, or in person
assistance, based including (nationwide)
on SSA protocols electronic
for third-party interaction Allow recognized
interaction (nationwide) third parties to
electronically (1)
Test use of mail- interact with SSA
in applications and (2) submit
for certain types complete application
of claims or for packages for
hard-to-reach determination by
applicant disability claim
populations manager (DCM)
(nationwide)
Develop, test, and
implement options
for immediate
telephone
interviews
Claimant Claimants (and
partnership in their families or
disability claims support networks)
processing who are able
actively
participate in
obtaining medical
evidence in
support of their
claims
(nationwide)
DCM as single In every region, Continue testing DCM is the single
agency contact for test ways to and implement point of contact for
all initial facilitate claims claims disability claims
claims-processing representative and representative and intake, decision-
activities disability disability making, and payment
examiner examiner teams, effectuation
interaction, as making them (nationwide)
well as teamwork, responsible for
in application disability claims
intake and claims intake, decision-
decision-making making, and
payment
effectuation
(nationwide)
Test use of DCM in
specified regional
sites or for
specified types of
claims
Evidence In every region, Decisionmaker
development test ways to decides the extent
tailored facilitate claims of medical
to claimant representative and development
circumstances disability necessary to reach
examiner a decision
interaction
regarding the
extent of medical
development
Predecision Publish final Provide
contact before regulations and predecision notice
initial denial conduct tests in and opportunity
determination selected sites on for a personal
the various means contact with the
of providing (1) decisionmaker,
predecision prior to issuing
notices and (2) an initial denial
opportunities for determination
personal contact (nationwide)
prior to issuing
an initial denial
determination
Statement of the Test use of Prepare a
claim enhanced decision statement of the
rationales in claim for all
reengineered initial claims
disability system determinations
(RDS) pilot sites (nationwide)
Disability decision methodology
--------------------------------------------------------------------------------
Eliminate "not Develop regulations
severe" step to remove the "not
severe" step
(nationwide)
Index of Disabling Develop and test, Develop and test Develop regulations
Impairments using existing the use of an that provide for an
replaces Listing regulatory Index of Disabling Index of Disabling
of Impairments authority, a means Impairments (adult Impairments (adult
to identify and child) to and child) to
disability facilitate replace the Listing
allowances earlier allowances earlier of Impairments
in the process in the (nationwide)
process
Ability to perform Assess research Continue research Expand case studies
substantial needs, develop and apply research to test refinements
gainful activity scope of work, and results to of new methodology
(SGA) (adults) award research refining the
contracts based on current approach Develop regulations
the relationship to assessing to apply new
between age and residual methodology
the ability to functional developed as a
adjust to other capacity and the result of case
work; the ability to perform studies (nationwide)
development of other work
standardized
approaches to Develop a baseline
assessing of occupational
functional demands that
ability, including represents work
the impact of existing in
education; and significant
identification of numbers in the
the functional national economy
requirements of
baseline work Model changes and
refinements to the
decision
methodology using
case studies and
other methods, as
appropriate
Comparable Develop, test, and
severity implement
(childhood) standardized
instruments for
assessing a child's
functional ability
(nationwide)
Change the role of Revise regulatory Test and implement
the medical requirements, for a new role for
consultant medical consultant medical
sign-off on consultants
initial (including Office
determinations, so of Hearings and
as to make them Appeals medical
consistent with experts) at all
existing statutory levels of
provisions decision-making
requiring medical (nationwide)
consultant
involvement in
childhood
disability claims
or claims that are
denied based on
mental
impairments
Identify
categories of
claims requiring
medical consultant
analysis at all
levels of
decision-making
Medical evidence development
--------------------------------------------------------------------------------
Streamlined and Identify Develop, test, and Standardized forms
targeted requests opportunities for implement for medical evidence
for medical which medical standardized forms collection are tied
evidence evidence for medical to Index
requirements can evidence requirements and
be streamlined collection, standardized
including fraud- functional
Test options for prevention assessment criteria
requesting, measures (nationwide)
storing, and (nationwide)
retrieving medical Treating sources are
records Integrate the encouraged to submit
electronically process for evidence
requesting, electronically
Local managers storing, and (nationwide)
focus resources on retrieving medical
professional records
education and electronically
medical relations into RDS
outreach with the
medical community,
including
consultative
examination
providers
(nationwide)
Increase customer
partnership in
claims processing
by providing
opportunity for
claimants to
pursue their own
medical evidence
Sliding-fee Develop and test Implement national Sliding-fee schedule
schedule for options for a sliding-fee tied to medical
medical evidence sliding-fee schedule for evidence
schedule for medical evidence requirements of new
medical evidence (nationwide) methodology
(nationwide)
Administrative
appeals process
First level of Initiate case Develop and
appeal is the reviews before publish
administrative law oral hearings to regulations to
judge (ALJ) expedite evidence implement an
hearing collection and adjudication
identify possible officer (AO)
allowances position
(nationwide)
Develop and
publish Develop and
regulations to publish
test options for regulations to
using an AO in eliminate
prehearing reconsideration
proceedings (nationwide)
Publish
regulations to
test options for
eliminating
reconsideration in
connection with
testing of
predecision notice
and contact
In specified
claims, conduct
prehearing
conferences to
narrow issues for
hearing
Revised role for Develop and Continue testing
Appeals Council publish and implement new
regulations to role for Appeals
test options for Council
narrowing the (nationwide)
scope of mandatory
Appeals Council
review
Develop and test
options, in
conjunction with a
new quality
assurance system,
for expanding the
Appeals Council's
own motion reviews
Quality assurance
--------------------------------------------------------------------------------
Training Provide consistent Identify new
training and training needs and
direction to all modify existing
disability training programs
decisionmakers based on results
(nationwide) of end-of-line
quality reviews
(nationwide)
In-line quality Develop and test Implement revised
reviews procedures for in-line quality
implementing peer review system at
review and in- all levels
line monitoring (nationwide)
Test revised in-
line quality
review system
End-of-line Develop and Implement revised
quality reviews implement revised comprehensive end-
end-of-line of-line (medical
review, addressing and nonmedical)
both medical and review system
nonmedical (nationwide)
accuracy in
Disability Use results of
Insurance (DI) and end-of-line review
Supplemental system to identify
Security Income needed policy and
(SSI) disability process
claims at all improvements
levels (nationwide)
(nationwide)
Customer Conduct customer Implement ongoing
satisfaction and employee customer and
surveys surveys in employee
conjunction with satisfaction
local, regional, surveys
and national (nationwide)
pilots of
disability process
changes
Measurements Measure overall Develop and Customize management
processing time implement revised information to
from the performance user's needs
customer's measures
perspective (nationwide)
(nationwide)
Enablers
--------------------------------------------------------------------------------
Process For determining
unification disability,
develop and
implement a single
presentation of
all substantive
policies, with
appropriate
monitoring and
enforcement
mechanisms
(nationwide)
Role of third Develop and
parties implement
(representatives) regulations
regarding
representatives'
qualifications and
standards of
conduct
(nationwide)
Conduct outreach
to the legal
community
regarding
disability
programs
requirements
Technology Implement RDS in Implement RDS with Implement fully
pilot sites enhanced integrated
decisional support disability claims-
Standardize claims (nationwide) processing system
file preparation with paperless
at all levels Implement video claims processing
(nationwide) conferencing at (nationwide)
appropriate remote
Test the use of sites Provide electronic
video conferencing access to claims-
at appropriate Begin integration processing system to
remote sites of other SSA claimants,
claims-processing representatives, and
Test redesign systems with RDS recognized third
features, where parties
feasible, in (nationwide)
intelligent
workstation/local Make cost-effective
area network (IWS/ video conferencing
LAN) sites technology available
(nationwide)
--------------------------------------------------------------------------------
(See figure in printed edition.)Appendix II
COMMENTS FROM THE SOCIAL SECURITY
ADMINISTRATION
=========================================================== Appendix I
(See figure in printed edition.)
(See figure in printed edition.)
(See figure in printed edition.)
GAO CONTACTS AND ACKNOWLEDGMENTS
========================================================= Appendix III
GAO CONTACTS
Michael T. Blair, Jr., Assistant Director, (404) 679-1944
Clarence L. Tull, Sr., Evaluator-in-Charge, (404) 679-1870
STAFF ACKNOWLEDGMENTS
In addition to those named above, John M. Ortiz coauthored the
report and contributed significantly to all data-gathering and
analysis efforts.
BIBLIOGRAPHY
============================================================ Chapter 1
Caudle, S. L. Reengineering for Results: Update. 1995.
Hammer, M., and J. Champy. Reengineering the Corporation. New
York: HarperCollins Publishers, 1993.
Hammer, M., and S. A. Stanton. The Reengineering Revolution. New
York: HarperCollins Publishers, 1995.
Linden, Russell M. Seamless Government: A Practical Guide to
Re-Engineering in the Public Sector. Jossey-Bass Publishers, 1994.
U.S. General Accounting Office. Business Process Reengineering
Assessment Guide. Exposure Draft, Version 1.0, 1995.
RELATED GAO PRODUCTS
============================================================ Chapter 2
SSA Disability Redesign: More Testing Needed to Assess Feasibility
of New Claim Manager Position (GAO/HEHS-96-170, Sept. 27, 1996).
Social Security Administration: Effective Leadership Needed to Meet
Daunting Challenges (GAO/HEHS-96-196, Sept. 12, 1996).
SSA Disability Reengineering: Project Magnitude and Complexity
Impede Implementation (GAO/T-HEHS-96-211, Sept. 12, 1996).
Social Security Administration: Effective Leadership Needed to Meet
Daunting Challenges (GAO/T-OCG-96-7, July 25, 1996).
Social Security Administration: Major Changes in SSA's Business
Processes Are Imperative (GAO/T-AIMD-94-106, Apr. 14, 1994).
*** End of document. ***