SSA Disability Benefits:

Enhanced Policies and Management Focus Needed to Address Potential Physician-Assisted Fraud

GAO-15-19: Published: Nov 10, 2014. Publicly Released: Dec 10, 2014.

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What GAO Found

The Social Security Administration (SSA) has policies and procedures in place for detecting and preventing fraud with regard to disability benefit claims. However, GAO identified a number of areas that could leave the agency vulnerable to physician-assisted fraud and other fraudulent claims:

  • SSA relies heavily on front-line staff in the offices of its disability determination services (DDS)—which have responsibility for reviewing medical evidence—to detect and prevent potential fraud. However, staff said it is difficult to detect suspicious patterns across claims, as directed by SSA policy, given the large number of claims and volume of medical information they review. Moreover, DDS offices generally assign claims randomly, so staff said it would only be by chance that they would review evidence from the same physician.
  • SSA and, in turn, DDS performance measures that focus on prompt processing can create a disincentive for front-line staff to report potential fraud because of the time it requires to develop a fraud referral. Four of the five DDS offices GAO visited count time that staff spend on documenting potential fraud and developing fraud referrals against their processing time. Some staff at these DDS offices said this creates a reluctance to report potential fraud.
  • The extent of anti-fraud training for staff varied among the five offices GAO visited and was often limited. SSA requires all DDSs to provide training to newly hired staff that includes general information on how to identify potential fraud, but does not require additional training. The five DDS offices GAO visited varied in whether staff received refresher training and its content—such as how to spot suspicious medical evidence from physicians—and staff at all levels said they needed more training on these issues.
  • SSA has not fully evaluated the risk associated with accepting medical evidence from physicians who are barred from participating in federal health programs. Although information from these physicians is not necessarily fraudulent, it could be associated with questionable disability determinations.

SSA has launched several initiatives to detect and prevent potential fraud, but their success is hampered by a lack of planning, data, and coordination. For instance, SSA is developing computer models that can draw from recent fraud cases to anticipate potentially fraudulent claims going forward. This effort has the potential to address vulnerabilities with existing fraud detection practices by, for example, helping to identify suspicious patterns of medical evidence. However, SSA has not yet articulated a plan for implementation, assigned responsibility for this initiative within the agency, or identified how the agency will obtain key pieces of data to identify physicians who are currently not tracked in existing claims' management systems. Furthermore, SSA is developing other initiatives, such as a centralized fraud prevention unit and analysis to detect patterns in disability appeals cases that could indicate fraud. However, these initiatives are still in the early stages of development and it is not clear how they will be coordinated or work with existing detection activities.

Why GAO Did This Study

SSA relies on medical evidence to determine whether the millions of new claimants each year qualify for disability benefits. This evidence—and those who provide it—have been the subject of intense scrutiny as questions have been raised about the potential for fraud schemes that include falsified medical evaluations. GAO was asked to study physician-assisted fraud in SSA's disability programs.

GAO reviewed (1) how well SSA's policies and procedures are designed and implemented to detect and prevent physician-assisted fraud, and (2) the steps SSA is taking to improve its ability to prevent physician-assisted fraud. GAO reviewed relevant federal laws and regulations, visited 5 of the 54 DDS offices that were selected to obtain geographic and office structure variation, and analyzed DDS data to identify whether federally sanctioned physicians (as of the end of January 2014) may have submitted evidence on behalf of claimants. GAO also interviewed SSA officials, as well as private disability insurers and others knowledgeable about SSA's programs to identify key practices for fraud prevention.

What GAO Recommends

GAO recommends SSA identify ways to remove potential disincentives for detecting and referring potential fraud, enhance its training efforts, evaluate the threat of physician-assisted fraud, and ensure that new and existing fraud efforts are coordinated. SSA agreed with four of our five recommendations, partially agreed with one, and noted plans to address all of them.

For more information, contact Daniel Bertoni at (202) 512-7215 or bertonid@gao.gov

Recommendations for Executive Action

  1. Status: Closed - Not Implemented

    Comments: SSA did not fully implement this recommendation. As of June 2019, the agency had developed and disseminated a Disability Determination Service Administrators Letter to inform DDS employees of best practices to detect and minimize physician-assisted fraud. The letter is intended to provide staff with an overview of fraud procedures, a reminder of staff responsibilities to policies regarding fraud, and links to training tools on fraud. SSA officials added that they try to stress to DDSs the importance of reporting fraud and recognizing or rewarding employees that do. However, SSA did not systematically determine whether existing standards used to assess DDS performance create disincentives for staff to report fraud. DDS staff are the first line of defense against potential fraud, and as such, it is important to ensure they do not face barriers to reporting fraud.

    Recommendation: To improve the ability of the agency to detect and prevent potential physician-assisted fraud, and to address potential disincentives for staff to detect and prevent physician-assisted fraud, SSA should review the standards used to assess DDS performance; and develop and distribute promising practices to incentivize staff to better balance the goal of processing claims promptly with the equally important goal of identifying and reporting evidence of potential fraud.

    Agency Affected: Social Security Administration

  2. Status: Closed - Implemented

    Comments: SSA reported taking a number of actions to remind staff of existing policies and the importance of reporting potentially fraudulent claims. For instance, it provided related information to DDS administrators in several meetings in 2014 and 2015, and included reminders in its mandatory anti-fraud training in 2015.

    Recommendation: To improve the ability of the agency to detect and prevent potential physician-assisted fraud, and to ensure that the agency captures complete information on suspicious claims, SSA should issue guidance to remind DDSs of its existing policy to report all claims with potentially fraudulent medical evidence to the SSA's Office of the Inspector General (SSA OIG), even if sufficient evidence exists to deny a claim.

    Agency Affected: Social Security Administration

  3. Status: Closed - Implemented

    Comments: SSA reported taking a number of steps to enhance its training efforts. In 2014, the agency and its OIG developed and released video on-demand training for all SSA and DDS staff, providing an overview of SSA's anti-fraud efforts and of employees' responsibility to report suspected fraud. SSA also issued a letter to all DDSs outlining the agency's fraud procedures and providing links to available anti-fraud training tools. In 2014 and 2015, SSA's Office of Quality Review held several fraud training classes for its employees. In addition, SSA reported it developed an ongoing training strategy in 2015 in which the agency will work with its OIG to provide training to employees on OIG fraud findings and trends to keep staff aware of shifting schemes to defraud SSA's disability programs.

    Recommendation: To improve the ability of the agency to detect and prevent potential physician-assisted fraud, and to help front-line staff identify potentially fraudulent activity, SSA should enhance its training efforts by ensuring it provides fraud-related refresher training to all DDS employees on a regular basis. Such training should include the identification of suspicious medical evidence and providers, as well as the processes and procedures for reporting such information. To facilitate its efforts, the agency could coordinate with the SSA OIG and draw on the type of training provided by Cooperative Disability Investigations' units.

    Agency Affected: Social Security Administration

  4. Status: Closed - Implemented

    Comments: SSA published final regulations in 2016, implementing requirements of the Bipartisan Budget Act of 2015, that generally prohibit it from considering medical evidence provided by sanctioned medical providers. In addition, SSA regulations also generally prohibit it from considering evidence provided by any medical sources convicted of certain felonies for providing false statements, and medical sources against which SSA levied civil monetary penalties for submitting false evidence. SSA also reported it is working to give its Disability Case Processing System the ability to identify sanctioned medical providers and alert staff that these sources provided medical evidence in support of claims.

    Recommendation: To improve the ability of the agency to detect and prevent potential physician-assisted fraud, and to address the potential risks associated with medical evidence submitted by sanctioned physicians, SSA should evaluate the threat posed by this information and, if warranted, consider changes to its policies and procedures.

    Agency Affected: Social Security Administration

  5. Status: Closed - Implemented

    Priority recommendation

    Comments: SSA has developed a plan for how it will assess physician-assisted fraud as part of a larger effort to assess fraud risks in its disability programs. SSA reported that this assessment informed its efforts on analytic detection, and identified programmatic and administrative controls to reduce its programs' exposure to fraud risk. The agency's plan for fraud analytics includes timeframes for implementation, data requirements, staffing needs, and identifies the SSA components that will be involved. SSA reported that it tested a predictive analytics model related to physician-assisted fraud, which it plans to continue refining in the future. SSA's actions should help the agency to better identify, and potentially prevent, physician-assisted fraud in the future, and result in improved stewardship of federal funds.

    Recommendation: To improve the ability of the agency to detect and prevent potential physician-assisted fraud, and to help ensure new initiatives that use analytics to identify potential fraud schemes are successful, SSA should develop an implementation plan that identifies both short- and long-term actions, including: (1) timeframes for implementation; (2) resources and staffing needs; (3) data requirements, e.g., the collection of unique medical provider information; (4) how technology improvement will be integrated into existing technology improvements such as the Disability Case Processing System and National Vendor File; and (5) how different initiatives will interact and support each other.

    Agency Affected: Social Security Administration

 

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