Social Security Statements:

Social Security Administration Should Better Evaluate Whether Workers Understand Their Statements

GAO-05-192: Published: Apr 1, 2005. Publicly Released: Apr 1, 2005.

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The Social Security Statement is the federal government's main document for communicating with more than 140 million workers about their Social Security benefits. By law, the statement must show an individual's annual earnings, payments into Social Security and Medicare, and projected benefits. The Social Security Administration also uses the statement to explain the various types of Social Security benefits and to encourage greater financial planning for retirement. GAO conducted a review to examine (1) how well recipients understand the current statement, (2) how the Social Security Administration is evaluating the statement's understandability, and (3) the promising practices used by private sector companies and other industrial countries. GAO's information was obtained from its national survey and focus groups of statement recipients, a firm that evaluates benefit statements, officials from three other countries (Canada, Sweden, and the United Kingdom), and other experts from the private sector.

Participants in our review identified both strengths and weaknesses in the current statement's understandability. Many respondents to GAO's national survey recalled receiving a statement, but had little recollection of some components, for example, the information on Social Security's future. Focus group participants provided more detailed information; they found the statement to be comprehensive but less well presented than a comparison statement they also reviewed. A firm that evaluates benefits statements had similar conclusions. The firm rated the quality of primary content and said the general understandability of the statement favorably compared with that of other statements, but use of design to help convey information and quality of secondary content fared less well. The Social Security Administration's current evaluation of the statement's understandability is limited because it does not include focus groups or data from the agency's many public contacts. For feedback, the agency relies almost exclusively on an annual survey covering many aspects of the Social Security program. Its questions about the statement are general and change each year, limiting their effectiveness. The agency also does not routinely use data collected from such sources as its telephone call centers, walk-in traffic, or Web site to help determine whether the statement is meeting its goals. Private sector experts and countries GAO studied use several practices the Social Security Administration may find helpful, such as regularly gathering feedback from statement recipients, customizing messages for different age groups, and changing statements every few years to keep readers interested. They also tended to design their statements in ways GAO's focus groups preferred--for example, putting the most important information at the start.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: SSA incorporated changes into the Statement that included moving personalized information to the top of the two inside pages to make it easier for the recipient to identify quickly. SSA also revised the insert for workers who are 55 and older to add more information, make it more appealing visually, and include a chart to show the value of benefits at different ages. SSA has also developed a new insert for young workers age 25-35 that includes important financial, age-appropriate information, which includes graphics to enhance the visual appeal.

    Recommendation: On the basis of the data it receives and a review of promising practices in the private sector and other countries, SSA should consider revising the statement. These revisions could include showing the personalized benefit information first, using graphics to aid readers in quickly comprehending information or providing information to help recipients understand Social Security's contribution to their total retirement income.

    Agency Affected: Social Security Administration

  2. Status: Closed - Implemented

    Comments: SSA has developed a plan for evaluating its Statement. The plan has been implemented over the past several years and included four phases. Phase one, which took place from October 2005 to April 2008, consisted of focus groups that tested the Statement's content and format design. In phase two, SSA and a contractor conducted a survey in June 2008 to determine whether the Statement met SSA's objectives and to create a baseline for evaluating subsequent changes to the Statement. A final report of findings from the survey was completed in September 2008 and provided to officials in SSA's Office of Communications (OComm) for consideration in revisions to the Statement. The third phase reviewed SSA's internal data to determine if changes were needed to the Statement, which addresses GAO's concern about the systematic collection of data. Specifically, OComm reviewed existing data sources and identified several that maintained Statement-related information. They implemented changes to ensure they regularly received the data regularly. They decide whether the data are useful and changes to the Statement are warranted. The fourth and last phase consists of ongoing tracking surveys of recent Statement recipients to measure the Statement's effectiveness and to identify problem areas. Results from these surveys are used to recommend possible changes to the Statement. The first tracking survey was completed on June 14, 2009 and its results are under review. The second tracking survey is scheduled to begin in September 2009.

    Recommendation: SSA should develop a plan for regularly evaluating the statement through the collection of data from multiple sources, including information from surveys, focus groups, call centers, walk-in traffic, and its Web site.

    Agency Affected: Social Security Administration


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