Supplemental Security Income: Long-Standing Issues Require More Active
Management and Program Oversight (Testimony, 02/03/99, GAO/T-HEHS-99-51).

Pursuant to a congressional request, GAO discussed the Supplemental
Security Income (SSI) program, focusing on: (1) the problem areas that
currently pose the greatest risk to the SSI program; (2) the Social
Security Administration's (SSA) recent efforts to improve the SSI
program; and (3) additional actions that should be taken.

GAO noted that: (1) the SSI program suffers from program abuses and
mismanagement, increases in overpayments, and SSA's inability to recover
outstanding debt; (2) in February 1997, GAO designated SSI a high-risk
program because of its susceptibility to fraud, waste, and abuse, and
because of insufficient management oversight of the program; (3) to a
great extent, SSA's inability to address long-standing SSI program
problems is attributable to two underlying causes: (a) an organizational
culture that places a greater priority on processing and paying claims
than on controlling program expenditures; and (b) a management approach
characterized by SSA's reluctance to fulfill its SSI policy development
and planning role in advance of major program crises; (4) as a result,
SSA has continued to experience significant difficulties with regard to
verifying recipients' initial and continuing eligibility for benefits,
recovering SSI overpayments, combating program fraud and abuse and
providing adequate program direction; (5) since SSI was designated high
risk, SSA has taken a number of actions to improve the financial
integrity of the program and revise its traditional approach to program
management; (6) however, several of SSA's initiatives are now in the
early planning or implementation stages, or require the passage of new
legislation before they can move forward; (7) in other areas, SSA's
actions have been insufficient; and (8) thus, it is important that SSA
sustain and expand its efforts to address problem areas and strike a
balance between meeting the needs of SSI recipients and fiscal
accountability for its programs.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  T-HEHS-99-51
     TITLE:  Supplemental Security Income: Long-Standing Issues Require 
             More Active Management and Program Oversight
      DATE:  02/03/99
   SUBJECT:  Claims processing
             Program abuses
             Income maintenance programs
             Eligibility determinations
             Social security benefits
             Overpayments
             Internal controls
             Fraud
             Computer matching
IDENTIFIER:  Supplemental Security Income Program
             Old Age Survivors and Disability Insurance Program
             Social Security Disability Insurance Program
             SSI
             
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Cover
================================================================ COVER


Before the Subcommittee on Human Resources, Committee on Ways and
Means, House of Representatives

For Release on Delivery
Expected at 3:00 p.m.
Wednesday, February 3, 1999

SUPPLEMENTAL SECURITY INCOME -
LONG-STANDING ISSUES REQUIRE MORE
ACTIVE MANAGEMENT AND PROGRAM
OVERSIGHT

Statement of Cynthia M.  Fagnoni, Director
Income Security Issues
Health, Education, and Human Services Division

GAO/T-HEHS-99-51

GAO/HEHS-99-51T


(207055)


Abbreviations
=============================================================== ABBREV

  CDR - Continuing Disability Review
  DDS - Disability Determination Service
  DI - Disability Insurance
  OASI - Old Age and Survivors Insurance
  OCSE - Office of Child Support Enforcement
  OIG - Office of Inspector General
  SSA - Social Security Administration
  SSI - Supplemental Security Income

SUPPLEMENTAL SECURITY INCOME: 
LONG-STANDING ISSUES REQUIRE MORE
ACTIVE MANAGEMENT AND PROGRAM
OVERSIGHT
============================================================ Chapter 0

Mr.  Chairman and Members of the Subcommittee: 

I am pleased to be here today to discuss the Social Security
Administration's (SSA) Supplemental Security Income (SSI) program. 
SSI is the nation's largest cash assistance program for the poor.  In
fiscal year 1998, the program paid about 6.6 million low-income aged,
blind, and disabled recipients a total of approximately $27 billion. 
In that same year, current and former SSI recipients owed SSA more
than $3.3 billion in overpaid benefits, including $1.2 billion in
newly detected overpayments for the year.  Since assuming
responsibility for SSI in 1974, SSA has been significantly challenged
in its efforts to serve the diverse needs of recipients while still
protecting the financial health and integrity of the program.  Our
reports and those of oversight agencies have highlighted program
abuses and mismanagement, increases in SSI overpayments, and SSA's
inability to recover outstanding debt.  These and other problems
documented over the years have spurred congressional criticism of
SSA's ability to effectively manage SSI workloads and have also
served to reinforce public perceptions that SSA pays SSI benefits to
too many people for too long.  In February 1997, we designated SSI a
high-risk program because of its susceptibility to fraud, waste, and
abuse, and because of insufficient management oversight of the
program.  We also initiated a broad-based review of the program to
determine the root causes of long-standing SSI problems and the
actions necessary to address them.\1 Today I would like to discuss
the findings of our review and the problem areas that currently pose
the greatest risk to the SSI program.  I would also like to discuss
SSA's recent efforts to improve SSI program integrity and additional
actions that should be taken. 

In summary, our work shows that, to a great extent, SSA's inability
to address long-standing SSI program problems is attributable to two
underlying causes:  (1) an organizational culture that places a
greater priority on processing and paying claims than on controlling
program expenditures and (2) a management approach characterized by
SSA's reluctance to fulfill its SSI policy development and planning
role in advance of major program crises.  As a result, SSA has
continued to experience significant difficulties with regard to
verifying recipients' initial and continuing eligibility for
benefits, recovering SSI overpayments, combatting program fraud and
abuse, and providing adequate program direction.  Since SSI was
designated high risk, SSA has taken a number of actions to improve
the financial integrity of the program and revise its traditional
approach to program management.  However, several of SSA's
initiatives are now in the early planning or implementation stages,
or require the passage of new legislation before they can move
forward.  In other areas, SSA's actions have been insufficient. 
Thus, it is important that SSA sustain and expand its efforts to
address problem areas and strike a balance between meeting the needs
of SSI recipients and fiscal accountability for its programs. 


--------------------
\1 Supplemental Security Income:  Action Needed on Long-Standing
Problems Affecting Program Integrity (GAO/HEHS-98-158, Sept.  14,
1998). 


   BACKGROUND
---------------------------------------------------------- Chapter 0:1

SSI provides cash benefits to low-income aged, blind, or disabled
people.  Those who are applying for benefits on the basis of age must
be at least 65 years old and financially eligible for benefits; those
who are applying for disability benefits must qualify on the basis of
financial and medical criteria.  To qualify for benefits financially
in fiscal year 1998, individuals could not have income greater than
the maximum monthly SSI benefit of $494 ($741 for a couple) or have
resources that exceeded $2,000 ($3,000 for a couple).  To be
qualified as disabled, applicants must be unable to engage in any
substantial gainful activity because of an impairment expected to
result in death or last at least 12 months. 

The process SSA uses to determine an applicant's financial
eligibility for SSI benefits involves an initial determination when
someone first applies and periodic reviews to determine whether the
recipient remains eligible.  SSI recipients are required to report
significant events that may affect their financial eligibility for
benefits, including changes in income, resources, marital status, or
living arrangements--such as incarceration or moving into a nursing
home.  To verify that the information provided by a recipient is
accurate, SSA generally relies on matching data from other federal
and state agencies, including Internal Revenue Service 1099
information, Department of Veterans Affairs benefits data, and
state-maintained earnings and unemployment data.  When staff find
discrepancies between income and assets claimed by a recipient and
the data from other agencies, they send notices to SSA field offices
to investigate further. 

To determine a person's medical qualifications for SSI as a disabled
person, SSA must determine the individual's capacity to work as well
as his or her financial eligibility.  To determine whether an
applicant's impairment qualifies him or her for benefits, SSA uses
state Disability Determination Services (DDS) to make the initial
assessment.  Once a recipient begins receiving benefits, SSA is
required to periodically conduct Continuing Disability Reviews (CDR)
to determine whether a recipient's disabling condition has improved. 


   ORGANIZATIONAL CULTURE HAS
   PERPETUATED SEVERAL
   LONG-STANDING SSI PROBLEMS
---------------------------------------------------------- Chapter 0:2

To a significant extent, an agency's culture emanates from and is
shaped by top management officials who are charged with establishing
the priorities and performance goals that drive day-to-day program
operations.  Thus, over time, what is regularly emphasized, measured,
and rewarded by agency management becomes ingrained in the immediate
workload priorities of line managers and field staff.  If agency
priorities are not adequately balanced, serious program
vulnerabilities may arise. 

In work spanning more than a decade, we have noted that SSA's
operations have been heavily influenced by an organizational culture
or value system that places a greater value on quickly processing and
paying claims than on controlling program costs.  Our most recent
work has confirmed the continued existence of an agency culture that
views the SSI program in much the same way as SSA's Old Age and
Survivors Insurance (OASI) and Disability Insurance (DI)
programs--where emphasis is placed on quickly processing claims for
individuals with an earned right to benefits--rather than as a
welfare program, where stronger income and asset verification is
necessary.  SSA's organizational culture has been most evident in the
low priority it has often placed on verifying recipients' initial and
continuing eligibility for benefits, recovering SSI overpayments, and
addressing program fraud and abuse. 


      VERIFYING RECIPIENT
      ELIGIBILITY
-------------------------------------------------------- Chapter 0:2.1

In regard to verifying recipients' initial and continuing eligibility
for benefits, our work has shown that SSA has relied heavily on
recipients to self-report important eligibility information relating
to their financial status and disabling condition.  However,
recipients do not always report required information when they should
and may not report it at all.  Although SSA has procedures in place
to verify this information, they are often untimely and incomplete. 
Over the last several years, we have documented numerous examples of
payments made to ineligible recipients as a result of SSA's
inattention to the verification aspects of the SSI program, including
millions of dollars in benefit payments to prisoners\2 and nursing
home residents.\3 These erroneous payments occurred because
incarcerations and nursing home admissions were not being reported as
required, and SSA lacked timely and complete automated verification
data.  In the nursing home example alone, SSA has estimated that
overpayments may exceed $100 million annually. 

SSA also continues to rely heavily on computer matching with other
federal and state agencies to verify that recipient financial
information is correct.  However, these matches are not always the
most effective means of verification, because information is often
quite old and sometimes incomplete.  For example, SSA's computer
matches for earned income rely on data that are from 6 to 21 months
old, allowing overpayments to accrue for this entire period before
collection actions can begin.  We have estimated that direct on-line
connections (as opposed to computer matches) between SSA's computers
and databases maintained by state agencies--welfare benefits,
unemployment insurance, and worker's compensation benefits--could
have prevented or quickly detected $34 million in SSI overpayments in
one 12-month period.\4 We also reported in March 1998 that newly
available Office of Child Support Enforcement (OCSE) databases
maintained by SSA could prevent or more quickly detect about $380
million in annual SSI overpayments caused by unreported recipient
income.\5 In addition, we concluded that opportunities existed for
SSA to prevent almost $270 million in overpayments by accessing more
timely financial account information via a nationwide network that
currently links all financial institutions.  Such information would
help ensure that individuals whose bank accounts would make them
ineligible for SSI do not gain eligibility.  Our September 1998 SSI
report confirmed that SSI verification problems continue.  In that
report, we recommended that SSA enhance its ability to verify
applicant and recipient eligibility information by accelerating
efforts to identify more timely and complete financial verification
sources. 

SSA management has acknowledged that because of the rapidly rising
workloads of prior years, the agency decided to emphasize and
prioritize the expedient processing and payment of claims rather than
delay final decisions by requiring more thorough verification steps. 
Recently, however, SSA has begun to take more decisive action to
protect the financial integrity of the SSI program.  For example, SSA
has started a program to better identify recipients in jail who
should no longer be receiving benefits and is expanding its use of
on-line state data to obtain more real-time applicant and recipient
information.  In accordance with one of our recommendations, SSA also
plans to give field offices on-line access to OCSE wage data,
new-hire data, and unemployment insurance data by the Spring of 1999. 
Once implemented, this should allow field staff to better prevent SSI
overpayments by identifying undisclosed earnings at application.  In
its fiscal year 1999 budget, SSA also requested an additional $50
million to complete additional financial redeterminations of
individuals who have been designated as having a high probability of
being overpaid.  Finally, in May 1998, SSA submitted a legislative
proposal to the Congress seeking statutory authority to expand its
eligibility verification tools, including the ability to more quickly
obtain essential information from financial institutions, state
databases, and federal and state prisons in order to determine an
individual's eligibility for SSI benefits.\6 SSA's proposal also
sought authority to use a new computer match with the Health Care
Financing Administration to more quickly identify SSI recipients
residing in nursing homes.  If they become law, these and other
provisions currently under consideration by the Congress have the
potential to improve SSA's ability to better verify initial and
continuing eligibility and deter SSI program overpayments. 


--------------------
\2 Supplemental Security Income:  SSA Efforts Fall Short in
Correcting Erroneous Payments to Prisoners (GAO/HEHS-96-152, Aug. 
30, 1996). 

\3 Supplemental Security Income:  Timely Data Could Prevent Millions
in Overpayments to Nursing Home Residents (GAO/HEHS-97-62, June 3,
1997). 

\4 Supplemental Security Income:  Administrative and Program Savings
Possible by Directly Accessing State Data (GAO/HEHS-96-163, Aug.  29,
1996). 

\5 Supplemental Security Income:  Opportunities Exist for Improving
Payment Accuracy (GAO/HEHS-98-75, Mar.  27, 1998). 

\6 This proposal is entitled the Supplemental Security Income Program
Integrity Act of 1998 and was submitted to the Congress on May 4,
1998. 


      RECOVERING OVERPAYMENTS
-------------------------------------------------------- Chapter 0:2.2

In addition to problems associated with SSA's verification of SSI
eligibility information, SSA has not always aggressively pursued the
recovery of overpayments.  Thus, over time SSA's recovery efforts
have been outpaced by outstanding SSI debt, which is becoming an
increasingly large portion of all debt owed to the agency.  Between
1989 and 1998, outstanding SSI debt and annual overpayments more than
doubled to about $3.3 billion.  Although overpayment recoveries also
increased each year during this period, the gap between what is owed
SSA and what is actually collected has continued to widen (see fig. 
1). 

   Figure 1:  Gap Between SSI
   Overpayments and Recoveries
   Continues to Widen, Fiscal
   Years 1989-98

   (See figure in printed
   edition.)

Source:  SSA's Office of Finance, Assessment, and Management. 

As noted in our September 1998 report, to a great extent overpayment
recoveries have remained low because of SSA's reluctance to use debt
collection tools already available to it or seek statutory authority
for more aggressive tools.  We reported that SSA only began using tax
refund offsets in 1998 to recover overpaid SSI benefits, despite
having had the authority to do so since 1984.  The tax refund offset
represents one of the few tools available to SSA for recovering
overpaid benefits from former recipients.  In the first 4 months of
1998, SSA reported that it had collected more than $23 million
through this initiative.  Waiting many years to move forward with
this important recovery tool has likely cost the SSI program millions
of dollars in collections.  We also reported that, until recently,
SSA had not pursued the authority to use more aggressive debt
collection tools, such as the ability to administratively intercept
other federal benefit payments recipients may receive, notify credit
bureaus of an individual's indebtedness, use private collection
agencies, and charge interest on outstanding debt. 

Our work also identified another potential barrier to increased
overpayment recoveries:  the law that limits the amount SSA can
recover each month from overpaid SSI recipients.  Before 1984, SSA
could withhold up to 100 percent of an overpaid individual's benefit
amount.  However, pursuant to the Deficit Reduction Act of 1984 (P.L. 
98-369), SSA was limited to offsetting a maximum of 10 percent of a
recipient's total monthly income.  Thus, SSA lost the discretion to
withhold larger amounts, even for individuals who willfully and
continually fail to report essential information.  Our September 1998
report recommended that SSA seek legislative authority to withhold
larger amounts than the current 10-percent maximum from recipients
who chronically and willfully abuse program reporting requirements. 

Following a number of GAO briefings over the last year, and our April
1998 testimony before this Subcommittee in which we noted SSA's
continued reluctance to pursue more aggressive debt collection tools,
SSA submitted a legislative proposal to the Congress seeking
statutory authority to use credit bureaus, private collection
agencies, interest levies, and other tools to strengthen its
collection efforts.  To date, SSA has taken no action on our
recommendation to withhold greater amounts for recipients who abuse
reporting requirements.  However, SSA did include a provision in its
legislative proposal that would allow the agency to suspend for a
period of time the benefits of individuals who provide false
information or withhold information that affects their eligibility. 


      ADDRESSING FRAUD AND ABUSE
-------------------------------------------------------- Chapter 0:2.3

Over the years, we have documented the SSI program's susceptibility
to fraud and other abusive practices.  For example, we have reported
that "middlemen" were facilitating fraudulent SSI claims by providing
translation services to non-English-speaking individuals applying for
SSI.\7 We are also currently conducting a follow-up review of the
activities of middlemen in the SSI program.  In prior work, we also
found that thousands of individuals had transferred ownership of
resources such as cars, cash, houses, land, and other items valued at
an estimated $74 million to qualify for SSI benefits.\8 Although such
transfers are legal under current law, using them to qualify for
benefits has become an abusive practice that raises serious questions
about SSA's ability to protect taxpayer dollars from waste and abuse. 
The Congressional Budget Office has estimated that more than $20
million in additional savings could be realized through 2002 by
implementing an asset transfer restriction. 

The SSI program continues to be vulnerable to fraud and abuse. 
Although SSI represents less than 8 percent of total agency
expenditures, when compared with SSA's other programs--OASI and
DI--the SSI program accounted for about 37 percent of allegations
received by SSA's fraud hotline and 24 percent of convictions
obtained.  However, SSA has begun to take more decisive action to
address SSI fraud and abuse since the program was designated high
risk.  For example, the number of Office of Inspector General (OIG)
investigators have been increased significantly, and combatting fraud
and abuse was made a key goal of SSA's 1997 agency Strategic Plan. 
SSA has also established national and regional anti-fraud committees
to better identify, track, and investigate patterns of fraudulent
activity.  Several OIG "pilot" investigations are also under way that
are aimed at detecting fraud and abuse earlier in the application
process.  In addition, SSA has established procedures to levy civil
and monetary penalties against recipients and others who make false
statements to obtain SSI benefits.  Finally, in its May 1998
legislative proposal to the Congress, SSA included a provision aimed
at preventing individuals from transferring assets in order to
qualify for SSI. 

It is too early to tell what immediate and long-term effects SSA's
activities will have on detecting and preventing SSI fraud and abuse. 
However, we have noted that many years of inadequate attention to
program integrity issues have fostered a strong skepticism among both
headquarters and field staff about whether fraud detection and
prevention is an agency priority.  Many staff believe constant agency
pressure to process more claims has impeded the thorough verification
of claims and the development of fraud referrals.  Staff also have
expressed concern that SSA has not developed office work credit
measures, rewards, and other incentives to encourage employees to
devote more time to developing fraud cases--a process that often
takes many hours.  Our review of SSA's work credit system confirmed
that adequate measures of the activities and time necessary to
develop fraud referrals have not been developed.  Nor has SSA
developed a means of recording and rewarding staff for the time they
spend developing fraud cases.  As a result, many staff may be
unwilling to devote significant time to more thorough claims
verification because they fear production--that is, cases
processed--will be negatively affected.  Our report recommended that
SSA reevaluate its field office work credit and incentive structure
to encourage better verification of eligibility information and
attention to fraud and abuse.  SSA has initiated a review of its
existing work measurement system with a specific focus on the kind of
work that is counted and how time values are assigned to units of
work.  SSA expects to complete this review by mid-1999. 


--------------------
\7 Supplemental Security Income:  Disability Program Vulnerable to
Applicant Fraud When Middlemen Are Used (GAO/HEHS-95-116, Aug.  31,
1995). 

\8 Supplemental Security Income:  Some Recipients Transfer Valuable
Resources to Qualify for Benefits (GAO/HEHS-96-79, Apr.  30, 1996). 


   RECENT CHANGES IN MANAGEMENT
   APPROACH MAY IMPROVE PROGRAM
   DIRECTION
---------------------------------------------------------- Chapter 0:3

In addition to long-standing problems attributable to SSA's
organizational culture, our work suggests that SSA's management of
the SSI program has often led to untimely and flawed program policies
and inadequate program direction.  Proactive program management
requires a willingness on the part of an agency to identify and
decisively address problems before they reach crisis levels.  Where
internal operational remedies are insufficient to address a
particular program weakness, the agency should then suggest and
develop legislative proposals for change.  Proactive management also
requires a willingness to identify short- and long-term program
priorities and goals and to develop a clearly defined plan for
meeting those goals.  In prior reports, we have noted that program
direction and problem resolution at SSA have been hindered by SSA's
continued reluctance to take a leadership role in SSI policy
development before major program crises occur.  We have also reported
that program direction has been impaired by a strategic planning
process that has not sufficiently focused on the specific needs of
the SSI program and its recipients.  However, recent actions taken by
SSA show that the agency has begun to take a more proactive role in
both SSI policy development and program planning. 


      SSI POLICY DEVELOPMENT
-------------------------------------------------------- Chapter 0:3.1

As the nation's SSI program expert, SSA is uniquely positioned to
assess the program impacts of trends in the SSI population and
initiate internal policy "fixes" to address problems.  If internal
revisions would not be effective, SSA is best qualified to identify
areas where new legislation is needed and assist policymakers in
exploring options for change.  However, we concluded in our September
1998 report that SSA has not always been sufficiently aggressive in
this regard.  Our report also included numerous examples in which SSA
did not take a leadership role in SSI policy development before major
crises occurred.  An example of SSA's approach was evident in the
congressional debate surrounding SSI for children in which the
Congress ultimately passed legislation limiting SSI childhood
eligibility.  SSA did not develop and communicate timely information
to the Congress on the effects of prior legislative and
court-mandated changes.  Nor did SSA develop its own proposals for
revising childhood eligibility policies, despite the fact that it had
information that guidelines for determining the severity of childhood
mental and physical impairments were difficult to interpret, unclear,
and too subjective.  At a much earlier time, this information could
have been shared with the Congress for consideration in reassessing
whether the SSI program was meeting the needs of the most severely
disabled children. 

SSA has acknowledged the need to play a more active policy
development role and has restructured its research and policy
development components to better address our concerns.  In this
regard, SSA has also made conducting effective policy development,
research, and program evaluation a key agency goal.  Additional
staffing resources are also being obtained by the newly created
Office of Policy.  Consequently, SSA should ultimately be better
positioned to develop policy options and proposals for the SSI
program.  As noted earlier, SSA also recently developed and submitted
to the Congress its first major SSI legislative proposal aimed at
improving program integrity by ensuring that only eligible
individuals receive benefits.  This proposal responds to many of our
prior recommendations and, if enacted, has the potential to
significantly improve SSA's ability to deter and recover SSI program
overpayments. 


      SSI STRATEGIC PLANNING
-------------------------------------------------------- Chapter 0:3.2

Our earlier work has also shown that SSI program direction has
suffered as a result of SSA's failure to develop program-specific
goals, priorities, and plans for addressing program weaknesses.  The
persistence of the long-standing problems discussed today
demonstrates SSA's inability to focus on its most critical program
challenges.  To a significant degree, this may be due to SSA's
strategic planning efforts, which generally involve agencywide goals
and concerns with no programmatic focus.  As required by the
Government Performance and Results Act of 1993,\9 SSA issued its
current agency strategic plan in September 1997.  This plan outlines
SSA's strategic goals and objectives for the next 5 years.  SSA also
recently published its fiscal year 1999 annual performance plan,
which provides more detailed information on how SSA intends to
achieve its goals and measure performance.  In reviewing these plans,
we found that SSA still had not adequately developed programmatic
goals, initiatives, and performance measures to address the specific
needs and problems of the SSI program.  Thus, we recommended that SSA
move forward in developing an SSI-focused plan with clearly defined
goals and measures to gauge SSA's progress in addressing its SSI
program challenges. 

In response to our recommendation, SSA produced its first SSI
management report in October 1998, which discusses the need to take
aggressive action in four areas:  improving overall payment accuracy,
increasing continuing disability reviews, combatting program fraud,
and improving debt collection.  The management report established
specific goals to measure the anticipated yearly impact of planned
initiatives in each of these areas.  In this report, SSA notes that a
number of initiatives should achieve results in the near future,
while others will take longer to produce significant impacts.  The
agency plans to closely monitor each initiative and make
modifications when necessary to ensure that the best possible results
are achieved. 


--------------------
\9 The Results Act requires federal agencies to implement
results-oriented management reforms, such as conducting strategic
planning, establishing program goals and objectives, measuring
progress in meeting those goals, and reporting publicly on that
progress. 


   CONCLUSIONS
---------------------------------------------------------- Chapter 0:4

Because the SSI program is essential to the financial health and well
being of millions of low-income aged, blind, and disabled recipients,
it is essential that the program is adequately protected from fraud,
waste, and abuse.  However, after more than 20 years of operation,
the SSI program remains vulnerable and faces significant,
long-standing challenges.  To a large extent, the problems we have
discussed today are attributable to an ingrained organizational
culture that has historically placed a greater value on quickly
processing and paying claims than on controlling program costs, and a
management approach characterized by a reluctance to address SSI
problems requiring long-term solutions and/or legislative changes. 
As a result, billions of dollars have been paid over the years to
ineligible individuals and SSA has not always dealt proactively with
its most pressing program problems. 

SSA has acknowledged the important role of management in defining
organizational priorities and the need to strike a better balance
between serving the public and fiscal accountability for its
programs.  As noted, SSA has begun to take steps internally and in
coordination with the Congress to address a number of SSI program
vulnerabilities.  This includes seeking out more timely and complete
automated sources for verifying recipient eligibility information,
stepping up its efforts to combat fraud and abuse, and working with
the Congress to obtain legislative authority for additional debt
collection tools.  We believe that this combination of internal
program solutions and legislative proposals for change is essential
to improving program integrity. 

All of the ongoing and proposed initiatives we have discussed have
the potential to improve the integrity and financial health of the
SSI program.  However, many of the difficulties experienced by the
SSI program are the result of more than 20 years of inattention to
payment controls.  Therefore, significantly revising SSA's underlying
culture and management approach will require a concerted effort at
the highest levels of the agency and a willingness by the Congress to
provide SSA with needed legislative authorities. 


-------------------------------------------------------- Chapter 0:4.1

Mr.  Chairman, this concludes my prepared statement.  I will be happy
to respond to any questions you or other Members of the Subcommittee
may have. 


*** End of document. ***