Incapacitated Adults:

Oversight of Federal Fiduciaries and Court-Appointed Guardians Needs Improvement

GAO-11-678: Published: Jul 22, 2011. Publicly Released: Aug 11, 2011.

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If Social Security (SSA), Veterans Affairs (VA), and state courts find that adults are incapacitated, they appoint federal fiduciaries and court-appointed guardians to make decisions on their behalf. Incapacity is often associated with old age, so if these arrangements are not overseen, older adults could be vulnerable to financial exploitation. This report assesses (1) SSA, VA, and state court procedures for screening potential fiduciaries and guardians; (2) SSA, VA, and state court fiduciary and guardian monitoring; (3) information sharing between SSA and VA and between each agency and state courts; and (4) federal support for court oversight of guardians. GAO interviewed federal and court officials and experts, and reviewed federal laws, regulations, and policies, and others' compilations of state guardianship laws.

SSA, VA, and state courts have screening procedures for ensuring that fiduciaries and guardians are suitable. SSA and VA strive to prevent individuals who have misused beneficiaries' payments from serving again, and each is currently developing an automated system that will enhance its ability to compile and maintain information about misuse of benefits by fiduciaries. Similarly, according to the AARP Public Policy Institute, laws in most states require courts to follow certain procedures for screening guardians. However, only 13 states conduct criminal background checks on all potential guardians.

There are also statutes and regulations requiring SSA and VA to monitor fiduciary performance. Fiduciaries in each agency must periodically report on their responsibilities. Similarly, most states require courts to obtain annual reports from guardians. There is evidence that guardianship monitoring by state courts, however, needs improving, and promising practices have been proposed to strengthen it. Given limited resources for monitoring, courts may be reluctant to invest in these practices without evidence of their feasibility and effectiveness from projects designed to evaluate these practices.

Gaps in information sharing may adversely affect incapacitated adults. When VA and SSA have incapacitated beneficiaries in common, sharing certain information about them could enhance each agency's ability to protect the interests of these beneficiaries. While SSA and VA do not systematically share such information, VA can obtain such information from SSA on a case-by-base basis. SSA officials indicated, however, that obtaining similar information from VA may not be cost-effective given the relatively small proportion of SSA beneficiaries who also collect VA benefits. It is also in the best interest of incapacitated beneficiaries for federal agencies to disclose certain information about these beneficiaries and their fiduciaries to state courts. National organizations representing elder law attorneys and advocating for elder rights have noted that courts have difficulty obtaining such information when it is needed, particularly from SSA.

The federal government has a history of funding technical assistance and training related to guardianship for state courts, primarily through the AoA within HHS. In 2008, AoA established the National Legal Resource Center (NLRC) to support improvements in legal assistance for older adults and to support elder rights protections. Among its other projects, NLRC has supported an evaluation of Utah's public guardian program. Because of the federal government's activities in this area, it is well positioned and has an opportunity to lead in ensuring the rights of incapacitated adults with court-appointed guardians by supporting evaluations of promising court monitoring practices.

The Department of Health and Human Services (HHS) should consider funding evaluations of practices for monitoring guardians, and HHS agreed that the Administration on Aging (AoA) has the authority to take such action.

GAO also believes SSA should determine how it can, under current law, disclose certain information about beneficiaries and fiduciaries to state courts, upon request.

SSA disagreed and asserted that Privacy Act limitations prevent sharing this information with state courts. Given SSA's position, it should take whatever measures necessary to allow it to do so, including proposing legislative changes.

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 help state courts fulfill their role in appointing guardians for incapacitated adults, the Commissioner of SSA should take whatever measures necessary to allow it to disclose certain information about SSA beneficiaries and fiduciaries to state courts, upon request, including proposing legislative changes needed to allow it to do so.

    Agency Affected: Social Security Administration

    Status: Open

    Comments: SSA did not consider this recommendation viable. First, Privacy Act implications prevent the agency from sharing information about beneficiaries and fiduciaries with state courts without their written consent. SSA believes that the only alternative is a routine use statement, which is not an option because sharing this information with state courts does not appear to be compatible with the purpose for which it was collected. Second, disclosure of information to state courts is outside its mission, according to SSA, so they would have to charge state courts for providing this information because it cannot use congressionally-appropriated funds for this purpose. Third, the potential cost of developing and maintaining data sharing agreements with every court that makes guardianship decisions would be prohibitive. GAO recognizes these concerns. However, in response to SSA's concern about the cost of developing a system for sharing its information with state courts, our recommendation is intended to be general enough to allow the agency to determine the most cost- effective method for doing so. Also, we are not specifically recommending that each court have access, similar to VA's, to an SSA automated data system; data exchange agreements with every relevant court may not be necessary. The potential benefits to incapacitated SSA beneficiaries justify providing certain information about beneficiaries and fiduciaries to state courts upon request on a case- by-case basis. We continue to believe that it is in the best interest of incapacitated SSA beneficiaries for the agency to disclose certain information about beneficiaries and fiduciaries to state courts, upon request. Given SSA's position that the Privacy Act prevents the agency from undertaking this important activity, GAO recommends that it take whatever measures are necessary to allow it to do so, including proposing legislative changes. In 2012, SSA stated that it continues to disagree, reiterating that the Privacy Act forbids disclosure of personal information about a living person without the written consent of the individual or someone who can consent on the individual's behalf; and the proposed data sharing would not be cost effective since court-appointed guardians serve as representative payees in only one percent of their cases. In 2013, SSA reiterated this diagreement. GAO will close this recommendation as not implemented in FY15 barring agency action.

    Recommendation: To help state courts more effectively monitor guardianships, the Secretary of HHS should direct AoA to consider supporting the development, implementation, and dissemination of a limited number of pilot projects to evaluate the feasibility, cost, and effectiveness of one or more generally accepted promising practices for improving court monitoring of guardians.

    Agency Affected: Department of Health and Human Services

    Status: Open

    Comments: In 2011, HHS's Administration on Aging (AoA) commented that its "Model Approaches to Statewide Legal Assistance Systems" (Model Approaches) demonstration grant projects are intended to support the creation of high quality and high impact legal service delivery systems that effectively target scarce legal resources to older persons most in need. AoA believes this approach has enhanced the delivery of legal services to this population and may be sufficiently broad regarding legal "systems building" so that collaboration with state courts on guardianship monitoring can be incorporated into future grant design structures. They are positioned to sharpen their focus through the National Legal Resource Center to provide technical support and training to states on these issues and will explore data collection options related to elder victims of guardianship abuse. In 2013, AoA commented that it is expanding the scope of grants provided through Model Approaches to include the objective of collaborating with state courts on the issue of guardianship. AoA is funding seven new grants to help states expand and enhance the capacity of their legal service delivery networks to effectively respond to priority legal issues impacting seniors in the most social or economic need. They are designed to build on progress made in Model Approaches Phase I grants and will seek to calibrate existing legal service delivery systems to better address legal issues emerging from cases of elder abuse.

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