Social Security:

SSA Could Save Millions by Targeting Reviews of State Disability Decisions

HRD-90-28: Published: Mar 5, 1990. Publicly Released: Mar 5, 1990.

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GAO reviewed the Social Security Administration's (SSA) effectiveness in evaluating state disability determination services' (DDS) disability determinations.

GAO found that: (1) in 1988, SSA reviews saved an estimated $69 million in disability payments but only corrected about 10.5 percent of erroneous DDS allowances; (2) SSA did not have enough medical personnel to evaluate all the cases that it selected for review; (3) SSA could have saved an additional $32 million in benefits if it had targeted its 1988 reviews to the most error-prone cases; (4) targeting review samples would be more time-consuming, would require medical staff increases and would have increased 1988 review costs by an estimated $21.1 million; (5) SSA saved only $1.09 for each dollar that it spent on benefits continuance reviews in 1988; and (6) applying 1988 estimates, SSA could have saved about $120 million in benefits if it had combined sample targeting measures with a shift in funding from continuance reviews to initial reviews.

Matter for Congressional Consideration

  1. Status: Closed - Implemented

    Comments: The House Ways and Means Committee, Subcommittee on Social Security, introduced legislation that included the elements of the GAO recommendations. This legislation was passed in the Omnibus Budget Reconciliation Act of 1990, P.L. 101-508.

    Matter: Congress should revise section 221(c) of the Social Security Act to exclude continuing disability reviews from the universe of DDS decisions SSA is required to review. SSA could then limit its reviews of continuances to a quality assurance sample and transfer administrative resources to a more cost-effective targeted review of initial DDS allowances.

Recommendation for Executive Action

  1. Status: Closed - Implemented

    Comments: In February 1991, SSA implemented an automated per sample selection which will select target samples of state DDS decisions. This process is now operational in all DDS.

    Recommendation: The Secretary of Health and Human Services should direct SSA to use a targeted sample for its preeffectuation reviews of initial DDS allowances. While this would require some additional review and medical staff, costs would be far exceeded by the reductions in future benefit payments resulting from the targeted reviews.

    Agency Affected: Department of Health and Human Services

 

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