Chairman Shaw and Members of the Subcommittee, my name is Steve Korn and I am here today representing the National Council of Social Security Management Associations (NCSSMA). I am also the manager of the Social Security office in Vallejo, California, and have worked for the Social Security Administration (SSA) for 25 years. On behalf of our membership, I am very honored that the NCSSMA was selected to testify at this hearing on the challenges and opportunities facing SSA’s disability program.

As you know, Mr. Chairman, the NCSSMA is a membership organization of 3000 Social Security Administration managers and supervisors who work in SSA’s 1400 field offices and teleservice centers throughout the nation. It is most often our members who your staffs work with when problems and issues arise with Social Security recipients in your Congressional Districts. Since our organization was founded thirty-two years ago, the NCSSMA has been a strong advocate of locally-delivered services nationwide to meet the variety of needs of beneficiaries, claimants, and the general public. We, like you, consider our top priority to be a strong and stable Social Security Administration, which delivers quality services to our clients and your constituents.

While the number of people receiving Social Security or Supplemental Security Income (SSI) disability benefits constitute less than 20% of all those receiving Social Security or SSI, about two thirds of Social Security’s administrative budget, approximately $5 billion, will be spent on disability work this year. It is therefore not surprising that field offices spend a significant amount of our time and effort on the disability program. Field offices take disability claims, provide information to claimants and their representatives, initiate continuing disability reviews, and meet with the public and third parties to provide information about the disability program. Specifically, we are the primary point of interface with SSA for disability claimants. We hear their stories and see firsthand the effect our processes have on their lives. This gives us a unique perspective to look at current problems and assess opportunities for improvement.

In the following sections, we provide information about current problems with the disability program, especially from the perspective of our claimants. We support the establishment of a new position in SSA’s field offices designed to improve the front-end process. We will discuss other opportunities for improving the disability program. And we will talk about the resource needs that will be necessary if we realistically expect to address the significant problems facing the disability program, both now and in the future.

While considerable time and effort have been devoted throughout SSA to improve the processing of disability claims, significant problems remain. By far the most common complaint field offices hear is the amount of time it takes to receive a decision. Claimants wait an average of almost 4 months from filing to receipt of the initial decision. And the almost half million claimants who request a hearing with an Administrative Law Judge (ALJ) each year, can expect to wait, on average, over a year from the date of initial filing for a decision. Prospects for short-term improvement are not promising. At the initial level, pending claims at State agencies are increasing with over 100,000 cases nationwide on the shelf awaiting assignment to an analyst because they already have all the cases they can handle. And despite a drop in average processing time from just under 400 days in FY 1997 to just under 300 days in FY 2000, the number of cases pending at SSA’s hearing offices have again begun to rise.

While the delay in receiving a decision is the most obvious problem facing those who apply for disability benefits, it is not the only problem. A majority of claimants seem to have little understanding of how the process works and how decisions are made. They have little understanding of what is required to meet the Social Security Administration’s definition of disability or what they should do to document their claim. Unfortunately, limited field office resources have placed a premium on self-help completion of forms and telephone interviews. Claims representatives rarely have the time to fully review all forms completed by the claimant or fully explain how the process works. Failure to see the claimant face-to-face also increases the opportunity for fraudulent activity.

While the other significant problems facing the disability program are not as obvious to field office employees or members of the public, they have been documented by reports issued by the Social Security Advisory Board, GAO, and others. For example, there is wide variance in allowance rates and processing times from State to State. Court decisions have added significant complexity to the disability determination process and have seemed to increase the gap between criteria used to make initial and reconsidered decisions, and criteria used at the hearing level. And, despite recent attempts to focus more attention on helping beneficiaries return to work, the "all or nothing" statutory definition of disability, and the ensuing application process, which focuses on inabilities rather than abilities, tends to discourage beneficiaries from doing so.

Improving the Front-End Disability Process

Eight years ago SSA embarked on an ambitious project to improve the disability program by significantly redesigning its processes. Unfortunately, with one major exception, most initiatives that resulted from the redesign effort have not yet demonstrated success in either reducing processing times, increasing claimant satisfaction levels, or making the process more efficient. The Disability Claims Manager (DCM) pilot was the one initiative that could be proclaimed a success by any of the above measurements. Under this initiative, one individual, either in a field office or a Disability Determination Services (DDS), was given the responsibility for the complete processing, from initial application and interview to final decision, of an initial disability claim. The DCM served as the claimant’s point of contact throughout the initial claims process.

While final results of this three-year pilot are not yet available, both phase I and preliminary final results show that DCMs processed claims in less time than the current process. This was achieved while maintaining a level of accuracy that was at or above that achieved in the traditional initial claims process. DCMs have been more productive, at the peak of the pilot producing more work for the total number of staff hours involved than that produced in the current process. Claimants expressed high levels of satisfaction with the increased level of service provided under the pilot compared to the traditional process, especially claimants whose claims were denied. Moreover, employees involved in the test had a high level of job satisfaction.

Despite what we feel is the unqualified success of the DCM pilot, issues relating to the Federal-State relationship create a major and perhaps insurmountable impediment to nationwide implementation of the DCM. First of all, the law requires that disability decisions be made by State agencies rather than by SSA itself. While we agree with the Social Security Advisory Board’s recommendation in its January 2001 report, "Charting the Future of Social Security’s Disability Programs: The Need for Fundamental Change," that the idea of federalizing the disability determination process needs to be examined, it is unlikely such a major change will be enacted, at least in the short-term. Secondly, the establishment of both Federal and State DCMs is problematic in many States where employee pay scales are significantly below Federal pay scales. This would result in employees doing essentially the same job in the same relative location for different rates of pay.

However, the NCSSMA is recommending that SSA capitalize on the success of the DCM experience, within the confines of current law, by expanding and strengthening the role and performance of the field office in the front-end of the disability process. Specifically, we recommend creation of new position in SSA’s field offices whose focus would be the processing of disability claims. This is fully consistent with the Social Security Advisory Board recommendation that field offices be given increased responsibility for taking disability claims. This "Technical Expert for Disability" or "TED", for want of a better name, would be fully trained in the same basic medical determination training received by new DDS Disability Examiners (DEs). Their responsibilities would include:

• Intake of initial applications for disability benefits under both the Title II and Title XVI programs;
• Developing both the medical and non-medical aspects of certain claims;
• Making the non-medical and making or recommending the medical decisions in predetermined types of cases, with individual State agreement;
• Reviewing and taking, where indicated, the first action on disability claims being forwarded to the DDS for development and medical decision;
• Training and mentoring other field office employees involved in the disability process.

Implementation of the TED position would go a long way toward addressing one of the most pervasive problems in the initial disability decision making process by improving the quality of initial medical transmittals to DEs in DDSs. It would accelerate the timeliness and should have a positive impact on the accuracy of disability decisions. The TED would remain the primary contact for the claimant, answering questions pertaining to both the medical and non-medical decision making process, providing status on the receipt of requested medical information and explaining final decisions based on the facts of the case. When requested by the DE, they would assist with or conduct the claimant conference. Their medical training and their knowledge of the sequential evaluation process, coupled with their non-medical program knowledge, would equip them to truly provide single point of contact service.

With their primary contact in the field office, the public would have more choices in how they interact with us throughout the disability decision making process, including face-to-face when they so choose. Applicants would have help available to them from someone in their community who is familiar with medical sources, transportation issues, community resources and employment opportunities. Additionally, the TED located in community-based field offices would, through their enhanced knowledge of medical providers and sources, investigative work and personal contacts, help to strengthen the integrity of the program and thus help to deter fraud.

TEDs could be used to make final medical decision with the State’s concurrence. For example, TEDs could routinely make final and potentially same day decisions for claimants with terminal illnesses. Or States that are temporarily unable to handle their full volume of cases may choose to give TEDs authority to make final decisions for the full range of cases. This would give SSA additional flexibility to deal with growing backlogs.

Even where the TED did not make the final decision, it would help establish closer cooperation between FOs (field offices) and DDSs. It would result in a clear delineation of duties between the TED and DE, putting full responsibility for a high quality initial product on the TED, while providing that TED with the background, knowledge and focus that they need to produce such a product. It results in a shift in both process and responsibility that is essential if the TED is to develop a true feeling of ownership and accountability for this work product.

Most importantly, it provides the Agency with a way to meet the projected growth in the number of disability claims without a corresponding increase in processing time and in the number of complaints from the public, advocates and representatives about the initial disability claims process. The public can receive the level of responsive service and timely and accurate decision making to which they are entitled.

SSA needs to focus its efforts to produce improved automation support for the disability process. Unfortunately, we have not seen any significant results from over eight years of work on a redesigned disability system. Current efforts to produce an electronic disability folder (e-DIB) are promising, but by itself will not address many of the significant needs that now exist. Specifically, the NCSSMA sees the immediate need for improved software that would:

• Provide field offices with an intelligent front-end interview system that would allow us to obtain medical information. This would include "drop down" menus and an interview path based on the nature of the disability. Not only would this produce a more complete front-end product that should improve overall processing times and decision accuracy, but it would be more efficient than our current scattergun approach of obtaining the same basic information for all claimants whether it is relevant to their specific impairment or not. This same intelligent front-end system could also be placed on the Internet for use by claimants and third parties assisting claimants.
• Allow field offices to directly interface with DDS and Office of Hearings and Appeals (OHA) systems. This would allow all components to track processing of a case and directly post new information no matter what component received it.
• Assist in identifying and tracking the location of disability folders. Even with the eventual development of an electronic disability folder, the need to locate and retrieve pre-existing paper folders will continue for many years.

SSA needs to seriously look into significant changes to the hearing process that would make the process more efficient while significantly reducing the time it takes to receive hearing and appeals council decisions. Among the suggestions worth looking into are closing the record after the ALJ decision, agency representation at ALJ hearings, and the combining of OHA and SSA field offices. Finally, SSA and ALJs need to work together to formulate changes that will streamline the current process.

The Social Security Advisory Board in its January 2001 report, recommended that SSA exercise its authority, granted by a change in the law in 1980, to issue regulations to ensure quality and uniformity in the performance of the States. We endorse this recommendation. One of the essential problems stressing the system arises from the fact that we have 54 DDSs handling the initial medical decision function in a variety of ways. This is evidenced by the fact that allowance rates vary widely between States as does processing times. There is a need for consistency and uniformity if the American public is to get effective service.

SSA needs to reexamine the definition of disability to see if it is still consistent with national disability policy. This recommendation was also endorsed by the Social Security Advisory Board. The definition of disability currently in use has not been changed in over 30 years. It is at odds with the desire of many disabled individuals who want to work but still need some financial or medical assistance. While SSA will be challenged to come up with a new definition that will satisfy all stakeholders, its success in doing so may also lead to efficiencies in the process that were not possible within the limited scope of the redesign process initiated eight years ago.

SSA is currently struggling to keep up with disability workloads. Many State agencies are struggling to handle pending workloads with over 100,000 pending claims unassigned to DEs who have reached their limit. After a three-year drop, pendings are again increasing at OHA. Field offices also cannot keep up with the growing workloads. In their January 2001 report on disability, the Social Security Advisory Board states that, "As a result of the growth in the number of disability claimants and continued agency downsizing, field office personnel are no longer able to provide the kind of assistance many applicants need to file a properly documented claim. They lack the time to explain program rules and procedures so that applicants understand whether they meet the strict requirements of the Social Security disability definition and what items of information they need to document their case." The NCSSMA released a survey in March in which field managers documented the need for an additional 5000 employees simply to keep up with current workloads.

If the current situation were not troublesome enough, SSA expects a tremendous increase in disability applications over the next 10 years as the baby boomers reach the age in which disability is more common. SSA’s actuaries estimate that SSA will add 50% more Title II disability beneficiaries and 15% more SSI disability recipients over this period. During this same time, a significant portion of SSA’s technical staff that processes disability is expected to retire. The employees who replace them will take several years to reach equivalent levels of productivity.

While the suggestions offered above will result in significant improvements to SSA’s disability process, none will provide the type of productivity gain that will allow SSA to address even its current workload problems without additional resources. In fact, many of the recommendations will simply provide service improvements, such as decreased processing times, rather than processing efficiencies. Some will require additional resources to implement. Even those changes which will provide a more efficient process, such as automation of front-end intake or e-DIB, require up-front resources to design and implement.

We believe it is a mistake for the new Administration and Congress to fail to provide the resources needed to address the problems affecting the disability program now, and in the future. Working Americans who have paid into the program since joining the workforce have every right to expect that they will receive a level of service and a process commensurate with their investment. With total administrative costs for the entire SSA program only running at approximately 2 percent of receipts, we believe Americans would support the increase in funding devoted to disability processing necessary to achieve the improvements outlined in our testimony.

Again, Mr. Chairman, I thank you for this opportunity to appear before this Subcommittee. I would welcome any questions that you and your colleagues may have.