Social Security Disability:

Reviews of Beneficiaries' Disability Status Require Continued Attention to Achieve Timeliness and Cost-Effectiveness

GAO-03-662: Published: Jul 24, 2003. Publicly Released: Jul 24, 2003.

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The Social Security Administration (SSA) has had difficulty in conducting timely reviews of beneficiaries' cases to ensure they are still eligible for disability benefits. SSA has been taking steps to improve the cost-effectiveness of its review process. SSA has linked the review process to eligibility for a new benefit that provides return-to-work services. This report looks at SSA's ability to stay current with future reviews, identifies potential improvements to the review process, and assesses the review process--return-to-work link.

SSA will likely face a backlog of about 200,000 continuing disability review (CDR) cases by the end of fiscal year 2003. SSA officials attribute the pending backlog to its decision to reduce the number of cases reviewed as a result of the delay in obtaining fiscal year 2003 funding. In addition, the pending backlog resulted from putting more emphasis on initial applications over CDRs. To ensure CDRs receive adequate attention, SSA has requested some fiscal year 2004 funds be "earmarked" for these reviews. Given SSA's ability to eliminate its previous CDR backlog using targeted funds, this maneuver could help SSA. Over the next 5 years, SSA has estimated that 8.5 million CDRs, costing about $4 billion, are needed to stay current. If SSA generates another backlog, cost savings and program integrity may be compromised by paying benefits to disability beneficiaries who are no longer eligible to receive them. SSA is not making the best use of available information when conducting its CDRs, leaving opportunities for improvement. First, SSA's decisions on the timing of CDRs are not based on systematic analysis of available information. Second, SSA's process for determining which CDR method to use is not always based on the best available information. For example, SSA requires an in-depth review for all beneficiaries who, upon entering the program, are expected to medically improve even if current information on certain of those beneficiaries indicates that improvement is unlikely and that the review would be better handled through a shorter, less expensive method. Third, SSA has not fully pursued medical treatment data available from the Medicare and Medicaid programs despite their potential to improve SSA's decisions regarding which review method to use. Fourth, SSA's CDRs continue to be hampered by missing or incomplete information on beneficiaries' case history. SSA delays the provision of new return-to-work benefits to beneficiaries expected to medically improve based on the assumption that such beneficiaries are least likely to need them. However, according to SSA data, about 94 percent of such beneficiaries are not found to have medically improved upon completion of a disability review. As a result, some individuals who might benefit from return-to-work services are initially denied access to them. SSA is reviewing this policy and while doing so, will need to consider how to best balance its financial stewardship and return-to-work goals.

Status Legend:

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  • Review Pending-GAO has not yet assessed implementation status.
  • Open-Actions to satisfy the intent of the recommendation have not been taken or are being planned, or actions that partially satisfy the intent of the recommendation have been taken.
  • Closed-implemented-Actions that satisfy the intent of the recommendation have been taken.
  • Closed-not implemented-While the intent of the recommendation has not been satisfied, time or circumstances have rendered the recommendation invalid.
    • Review Pending
    • Open
    • Closed - implemented
    • Closed - not implemented

    Recommendations for Executive Action

    Recommendation: To further improve the cost-effectiveness of the CDR process, the Commissioner of SSA should pursue more comprehensive enhancements of the CDR diary process--beyond those already being considered--to ensure that the full benefits of a more systematic, quantitative approach to diary setting are attained. Among such key enhancements would be the use of a statistical approach to determine diary categories. Given the significant implications of such changes for the Disability Insurance and Supplemental Security Income programs, SSA could consider pilot testing the revised diary process before fully implementing it.

    Agency Affected: Social Security Administration

    Status: Closed - Implemented

    Comments: In fiscal year 2005, the Social Security Administration (SSA) engaged a contractor to make comprehensive enhancements to its continuing disability review (CDR) diary process that would produce a more systematic, automated, and quantitative approach to CDR diary setting through the use of more current data and new methodologies. The contractor has revised the model SSA uses in the diary process, which SSA reports provides better results than the previous model. The new diary process will apply a statistical model to determine CDR diary categories and diary dates and will apply to all Disability Insurance (DI) and Supplemental Security Income (SSI) beneficiaries at the point of their initial disability determinations and subsequent CDRs, except for cases involving children. SSA formally approved the model for implementation readiness in fiscal year 2006 and recently secured contract funds for its implementation.

    Recommendation: To further improve the cost-effectiveness of the CDR process, the Commissioner of SSA should, given the cost-effectiveness of conducting mailers in cases where there is a low likelihood for benefit cessation, revise SSA's policy to allow mailers to be sent whenever appropriate--as indicated by the profiling scores--to beneficiaries with a diary category indicating that they are expected to medically improve. For beneficiaries assigned to a diary category indicating that they are not expected to medically improve, SSA should conduct a thorough analysis of its current policy, which allows mailers to be used for all of these beneficiaries regardless of their profile scores. SSA's analysis should evaluate the overall cost-effectiveness of this policy, taking into account both the potential reduction in administrative costs from conducting fewer full medical reviews and the potential increase in benefit payments from reduced cessations. If this analysis indicates that the current policy results in higher overall costs for SSA's disability programs, SSA should revise the policy to make it consistent with the agency's general profiling approach--which prescribes the use of full medical reviews in cases where profiling indicates that a beneficiary has a relatively high likelihood of medical improvement.

    Agency Affected: Social Security Administration

    Status: Closed - Implemented

    Comments: Although Social Security Administration (SSA) has not changed its policy, it has implemented a new continuing disability review (CDR) diary process that can help ameliorate any inconsistencies through better harmonization of diary categories and profile scores. This will help them to better determine when beneficiaries should receive full medical reviews and when they should receiver mailers. We had recommended that SSA pursue more comprehensive enhancements of the CDR diary process, which SSA recently completed. SSA expects the cost-effective of its CDR process to be verified by ongoing integrity reviews. The agency's action will help address our concern about appropriately sending mailers and conducting full medical reviews.

    Recommendation: To further improve the cost-effectiveness of the CDR process, the Commissioner of SSA should study the use of Medicare and Medicaid data for the purpose of deciding whether to use a full medical review in conducting a CDR for beneficiaries who would otherwise receive a mailer. If found to be cost-effective, SSA should incorporate Medicare and Medicaid data into its CDR process for this purpose.

    Agency Affected: Social Security Administration

    Status: Closed - Implemented

    Comments: In 2007, SSA stated that it had completed development of a statistical sample of cases initially profiled as a continuing disability review (CDR) mailers and included this sample of cases for computer matching with Medicare data in the Office of Disability Determination's Fiscal Year 2006 Medicare data request to the Centers for Medicare and Medicaid Services. This sample will be the first in a series of ongoing annual samples intended to provide data to investigate the potential for using Medicare usage data to rescore cases initially profiled as a CDR mailers to cases in which a full medical CDR is warranted.

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