```

[House Hearing, 106 Congress]
[From the U.S. Government Publishing Office]

 
   SOCIAL SECURITY'S READINESS FOR THE IMPENDING WAVE OF BABY BOOMER 
                             BENEFICIARIES

=======================================================================

                                HEARING

                               before the

                    SUBCOMMITTEE ON SOCIAL SECURITY

                                 of the

                      COMMITTEE ON WAYS AND MEANS
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED SIXTH CONGRESS

                             SECOND SESSION

                               __________

                             MARCH 16, 2000

                               __________

                             Serial 106-44

                               __________

         Printed for the use of the Committee on Ways and Means

                     U.S. GOVERNMENT PRINTING OFFICE
66-455 CC                    WASHINGTON : 2000

                      COMMITTEE ON WAYS AND MEANS

                      BILL ARCHER, Texas, Chairman

PHILIP M. CRANE, Illinois            CHARLES B. RANGEL, New York
BILL THOMAS, California              FORTNEY PETE STARK, California
E. CLAY SHAW, Jr., Florida           ROBERT T. MATSUI, California
NANCY L. JOHNSON, Connecticut        WILLIAM J. COYNE, Pennsylvania
AMO HOUGHTON, New York               SANDER M. LEVIN, Michigan
WALLY HERGER, California             BENJAMIN L. CARDIN, Maryland
JIM McCRERY, Louisiana               JIM McDERMOTT, Washington
DAVE CAMP, Michigan                  GERALD D. KLECZKA, Wisconsin
JIM RAMSTAD, Minnesota               JOHN LEWIS, Georgia
JIM NUSSLE, Iowa                     RICHARD E. NEAL, Massachusetts
SAM JOHNSON, Texas                   MICHAEL R. McNULTY, New York
JENNIFER DUNN, Washington            WILLIAM J. JEFFERSON, Louisiana
MAC COLLINS, Georgia                 JOHN S. TANNER, Tennessee
ROB PORTMAN, Ohio                    XAVIER BECERRA, California
PHILIP S. ENGLISH, Pennsylvania      KAREN L. THURMAN, Florida
WES WATKINS, Oklahoma                LLOYD DOGGETT, Texas
J.D. HAYWORTH, Arizona
JERRY WELLER, Illinois
KENNY HULSHOF, Missouri
SCOTT McINNIS, Colorado
RON LEWIS, Kentucky
MARK FOLEY, Florida

                     A.L. Singleton, Chief of Staff

                  Janice Mays, Minority Chief Counsel

                                 ______

                    Subcommittee on Social Security

                  E. CLAY SHAW, Jr., Florida, Chairman

SAM JOHNSON, Texas                   ROBERT T. MATSUI, California
MAC COLLINS, Georgia                 SANDER M. LEVIN, Michigan
ROB PORTMAN, Ohio                    JOHN S. TANNER, Tennessee
J.D. HAYWORTH, Arizona               LLOYD DOGGETT, Texas
JERRY WELLER, Illinois               BENJAMIN L. CARDIN, Maryland
KENNY HULSHOF, Missouri
JIM McCRERY, Louisiana

Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public 
hearing records of the Committee on Ways and Means are also published 
in electronic form. The printed hearing record remains the official 
version. Because electronic submissions are used to prepare both 
printed and electronic versions of the hearing record, the process of 
converting between various electronic formats may introduce 
unintentional errors or omissions. Such occurrences are inherent in the 
current publication process and should diminish as the process is 
further refined.

                            C O N T E N T S

                               __________

                                                                   Page

Advisory of March 1, 2000, announcing the hearing................     2

                               WITNESSES

Social Security Administration, Hon. Kenneth S. Apfel, 
  Commissioner of Social Security................................     5

                                 ______

National Association of Disability Examiners, Terri Spurgeon.....    61
National Council of Social Security Administration Field 
  Operations Locals, American Federation of Government Employees, 
  AFL-CIO, Council 220, and AFGE-SSA National Partnership 
  Council, Witold Skwierczynski..................................    54
National Council of Social Security Management Associations, 
  Inc., Steve Korn...............................................    74
National Senior Citizens Law Center, Gerald A. McIntyre..........    49
National Treasury Employees Union, and Office of Hearings and 
  Appeals, Social Security Administration, Cleveland Heights, 
  Ohio, James A. Hill............................................    66
SSI Coalition for a Responsible Safety Net, Sue Augustus.........    43

                       SUBMISSIONS FOR THE RECORD

American Federation of Government Employees, Chicago, IL, Earl 
  Tucker, letter and attachment..................................    96
Association of Attorney-Advisors, Knoxville, TN, James R. 
  Hitchcock, letter and attachment...............................    99
Consortium for Citizens with Disabilities, Adapted Physical 
  Activity Council, American Association on Mental Retardation, 
  American Network of Community Options and Resources, 
  Association for Persons in Supported Employment, Brain Injury 
  Association, Inter-National Association of Business, Industry 
  and Rehabilitation, International Association of Psychosocial 
  Rehabilitation Services, National Association of Developmental 
  Disabilities Councils, National Mental Health Association, 
  National Organization of Social Security Claimants' 
  Representatives, NISH, Paralyzed Veterans of America, Research 
  Institute for Independence Living, The Arc of the United 
  States, Title II Community AIDS National Network, and United 
  Cerebral Palsy Associations, Inc., joint statement.............   103
National Organization of Social Security Claimants' 
  Representatives, Nancy G. Shor, statement......................   105
Wickham, Cristin J., statement and attachment....................   106

   SOCIAL SECURITY'S READINESS FOR THE IMPENDING WAVE OF BABY BOOMER 
                             BENEFICIARIES

                              ----------                              

                        THURSDAY, MARCH 16, 2000

                  House of Representatives,
                       Committee on Ways and Means,
                           Subcommittee on Social Security,
                                                   Washington, D.C.
    The Subcommittee met, pursuant to notice, at 10:05 a.m., in 
Room 1100, Longworth House Office Building, Hon. E. Clay Shaw, 
Jr. (Chairman of the Subcommittee) presiding.

ADVISORY FROM THE COMMITTEE ON WAYS AND MEANS

                    SUBCOMMITTEE ON SOCIAL SECURITY

                                                CONTACT: (202) 225-9263
FOR IMMEDIATE RELEASE

March 1, 2000

No. SS-11

               Shaw Announces Second Hearing in Series to

  Examine Social Security's Readiness for the Impending Wave of Baby 
                          Boomer Beneficiaries

    Congressman E. Clay Shaw, Jr., (R-FL), Chairman, Subcommittee on 
Social Security of the Committee on Ways and Means, today announced the 
second in a series of hearings to examine Social Security's readiness 
for the impending wave of Baby Boomer beneficiaries. This hearing will 
focus on what Social Security is doing to prepare for current and 
future service delivery challenges. The hearing will take place on 
Thursday, March 16, 2000 , in the main Committee hearing room, 1100 
Longworth House Office Building, beginning at 10:00 a.m. Subsequent 
hearings in the series will be announced at a later date.
    In view of the limited time available to hear witnesses, oral 
testimony at this hearing will be from invited witnesses only. 
Witnesses will include the Commissioner of the Social Security 
Administration (SSA), Social Security management and employee 
representatives, and advocates for Social Security and Supplemental 
Security Income recipients. However, any individual or organization not 
scheduled for an oral appearance may submit a written statement for 
consideration by the Committee and for inclusion in the printed record 
of the hearing.
      

BACKGROUND:

      
    The services that the Social Security Administration (SSA) provides 
impact the lives of nearly all Americans. For example, in 1999 SSA paid 
benefits to more than 45 million retired and disabled workers and their 
families and to more than 6.6 million Supplemental Security Income 
recipients, processed 250 million reports of earnings and more than 6 
million initial claims for benefits, handled more than 26 million 
visitors requesting services at 1,300 field offices, fielded 80 million 
calls to the 800-number service, issued 16 million new and replacement 
Social Security numbers, and provided 30 million Social Security 
Statements to help individuals plan for their financial future.
      
    As America enters the 21st Century, SSA will face increasing 
challenges. SSA workloads are projected to begin increasing rapidly 
within the next decade as the huge Baby Boom generation enters its peak 
disability years prior to reaching early retirement age starting in the 
year 2008. Social Security retirement and disability workloads are 
projected to rise 16 percent and 47 percent, respectively, between now 
and the year 2010. Claims under the Supplemental Security Income (SSI) 
program, which is administered by SSA and provides cash benefits to 
poor disabled and elderly individuals, are expected to grow 12 percent 
between now and the year 2020. At the same time, Social Security 
programs are becoming more complex, with initiatives to prevent fraud 
and abuse, complete continuing disability reviews, provide increased 
rehabilitation and employment services for the disabled, and perform 
reviews to determine whether SSI beneficiaries continue to meet the 
program's income and resource requirements. These factors, combined 
with recent workforce downsizing and the coming retirement of large 
numbers of SSA's aging workforce, will place tremendous pressures on 
the Agency to meet the public's need for service in the 21st century.
      
    The first hearing in the series on February 10, 2000, focused on 
Social Security's service delivery practices, key service delivery 
challenges, and strategies to address those challenges.
      
    In announcing the hearing, Chairman Shaw stated: ``At our first 
hearing, we learned about the challenges Social Security will face in 
years to come as its own workforce ages and the number of Americans 
depending on Social Security skyrockets. This hearing will focus on how 
SSA is preparing for those challenges, including what steps it plans to 
take to provide world-class service as promised.''
      

FOCUS OF THE HEARING:

      
    This hearing will focus on SSA's service delivery practices, key 
current and future service delivery challenges, and plans to overcome 
those challenges and provide timely, high-quality, and cost-effective 
customer service in the years ahead.
      

DETAILS FOR SUBMISSION OF WRITTEN COMMENTS:

      
    Any person or organization wishing to submit a written statement 
for the printed record of the hearing should submit six (6) single-
spaced copies of their statement, along with an IBM compatible 3.5-inch 
diskette in WordPerfect or MS Word format, with their name, address, 
and hearing date noted on a label, by the close of business, Thursday, 
March 30, 2000 , to A.L. Singleton, Chief of Staff, Committee on Ways 
and Means, U.S. House of Representatives, 1102 Longworth House Office 
Building, Washington, D.C. 20515. If those filing written statements 
wish to have their statements distributed to the press and interested 
public at the hearing, they may deliver 200 additional copies for this 
purpose to the Subcommittee on Social Security office, room B-316 
Rayburn House Office Building, by close of business the day before the 
hearing.
      

FORMATTING REQUIREMENTS:

    Each statement presented for printing to the Committee by a 
witness, any written statement or exhibit submitted for the printed 
record or any written comments in response to a request for written 
comments must conform to the guidelines listed below. Any statement or 
exhibit not in compliance with these guidelines will not be printed, 
but will be maintained in the Committee files for review and use by the 
Committee.
      
    1. All statements and any accompanying exhibits for printing must 
be submitted on an IBM compatible 3.5-inch diskette in WordPerfect or 
MS Word format, typed in single space and may not exceed a total of 10 
pages including attachments. Witnesses are advised that the Committee 
will rely on electronic submissions for printing the official hearing 
record.
      
    2. Copies of whole documents submitted as exhibit material will not 
be accepted for printing. Instead, exhibit material should be 
referenced and quoted or paraphrased. All exhibit material not meeting 
these specifications will be maintained in the Committee files for 
review and use by the Committee.
      
    3. A witness appearing at a public hearing, or submitting a 
statement for the record of a public hearing, or submitting written 
comments in response to a published request for comments by the 
Committee, must include on his statement or submission a list of all 
clients, persons, or organizations on whose behalf the witness appears.
      
    4. A supplemental sheet must accompany each statement listing the 
name, company, address, telephone and fax numbers where the witness or 
the designated representative may be reached. This supplemental sheet 
will not be included in the printed record.
      
    The above restrictions and limitations apply only to material being 
submitted for printing. Statements and exhibits or supplementary 
material submitted solely for distribution to the Members, the press, 
and the public during the course of a public hearing may be submitted 
in other forms.
      

    Note: All Committee advisories and news releases are available on 
the World Wide Web at ``http://waysandmeans.house.gov''
      

    The Committee seeks to make its facilities accessible to persons 
with disabilities. If you are in need of special accommodations, please 
call 202-225-1721 or 202-226-3411 TTD/TTY in advance of the event (four 
business days notice is requested). Questions with regard to special 
accommodation needs in general (including availability of Committee 
materials in alternative formats) may be directed to the Committee as 
noted above.
      

                                

    Chairman Shaw. Good morning. Today, we are holding the 
second hearing in a series about Social Security's current and 
future service delivery challenges. On February 10, we heard 
from the Social Security Advisory Board, among others, about 
specific concerns they had with the way Social Security is 
approaching its current and future service delivery challenges.
    At the start of that hearing, I quoted from the Advisory 
Board report which concluded, and I quote, ``There is a 
significant gap between the level of services that the public 
needs and that which the agency is providing. Moreover, this 
gap should grow to far larger proportions in the long term if 
it is not adequately addressed,'' end quote.
    I don't think we have heard anything during the course of 
our prior hearings to diminish our concerns. On the contrary, 
we learned that the number of Social Security applicants will 
rise rapidly in the next 10 years. At the same time, Social 
Security's own workforce is headed toward retirement in record 
numbers. Coupled with the already great challenges that SSA 
faces in providing timely, efficient services today, these twin 
challenges loom large on the horizon.
    So last month's hearing posed lots of questions about what 
Social Security is doing to prepare for the future. Today, we 
hope to hear a lot of the answers. We are privileged to have 
Social Security Commissioner, Commissioner Apfel, here with us, 
along with a number of beneficiary and employee 
representatives. We expect them to help us assess both what 
needs to be done and whether Social Security is positioned to 
take the right steps to efficiently and effectively deliver 
services to the public into the 21st century.
    Mr. Matsui?
    Mr. Matsui. Thank you, Mr. Chairman. I just would like to 
welcome Commissioner Apfel as well and submit my statement for 
the record.
    Chairman Shaw. Fine, thank you.
    [The opening statement follows:]

Opening Statement of Hon. Robert T. Matsui, a Representative in 
Congress from the State of California

    Thank you, Mr. Chairman.
    I want to commend you on holding this important hearing. 
Today is the second of two hearings on customer service 
delivery at the Social Security Administration. I believe it is 
extremely important that we take the opportunity now to address 
the challenges that will face SSA in the future as that agency 
copes with the retirement of the baby boomers.
    As we learned from members of the Social Security Advisory 
Board in our first hearing last month, the two major challenges 
SSA will face in the years ahead will be growing workloads and 
an aging workforce. Both of these trends are the direct result 
of the impending retirement of the Baby Boom generation.
    I am very pleased that Commissioner Apfel is with us today 
to share his thoughts on how SSA plans to meet these two 
challenges. I look forward to hearing his testimony.
    I also think it is important to keep in mind that, while 
there are problems that need to be addressed at the Social 
Security Administration, the agency remains a leader among 
government agencies in managing its resources and meeting the 
needs of the public.
    In fact, SSA outperforms most other government agencies in 
terms of the quality of its management and its responsiveness 
to customers. As I mentioned at the first hearing, the American 
Customer Satisfaction Index surveyed customers of 29 different 
federal agencies in December 1999 to assess their satisfaction 
with federal government services. SSA scored an 82 out of a 
possible 100 points, well above the aggregate score of 68.6 for 
the federal government as a whole and even above the comparable 
scores for private companies like GTE and Nike.
    As we discuss growing Social Security workloads and an 
aging workforce at SSA, we should remember that Congress has 
consistently fallen short in meeting SSA's budget requests. 
Since SSA became an independent agency in 1994, Congress has 
not enacted a single appropriations bill that met SSA's request 
for its administrative budget.
    Just yesterday, the House Budget Committee reported out 
this year's budget resolution that would reduce non-defense 
discretionary spending by $107 billion over the next five years 
relative to the current-services baseline. My understanding of 
the effect of this budget resolution is that it would translate 
into a $1.2 billion reduction from the President's FY 2001 
request for SSA. Obviously this level of funding would deeply 
damage SSA's ability to serve the public.
    While it is incumbent upon the Congress to ensure that SSA 
is utilizing its existing resources in the most efficient 
manner possible, it is also incumbent upon the Congress to 
provide SSA with the resources it needs. In light of the 
testimony from two hearings on customer service, I hope that we 
will not tolerate this short-sighted approach to budgeting when 
we consider the agency's FY 2001 appropriation later this year.
    Thank you to all our witnesses for being here today. I look 
forward to hearing your testimony.
    Thank you, Mr. Chairman.
      

                                

    Chairman Shaw. With that, Commissioner, welcome back to 
this committee again and again, and we look forward to your 
testimony.

  STATEMENT OF HON. KENNETH S. APFEL, COMMISSIONER OF SOCIAL 
            SECURITY, SOCIAL SECURITY ADMINISTRATION

    Mr. Apfel. Thank you, Mr. Chairman, Mr. Matsui, and members 
of the subcommittee. Thank you for inviting me to testify today 
about the ways in which the Social Security Administration 
serves the American public. It is an issue of paramount concern 
to us.
    One reason is the sheer magnitude of our service 
responsibilities. We are committed to providing the right 
benefit payment to the right person on time, and to do so for 
50 million Social Security and SSI beneficiaries. On average, 
each workday about 100,000 people visit one of our 1,300 field 
offices and over 240,000 people call our 800 number. Each 
workday, we process an average of 20,000 initial claims for 
retirement, survivors, disability, or SSI benefits, and hold 
2,400 hearings before administrative law judges. Each year, we 
make certain that 250 million wage items are correctly credited 
to workers' earnings records to ensure that future benefit 
payments are accurate.
    We have a long history at SSA of solid and reliable 
customer service. In fact, in 1999, customer satisfaction was 
at an all-time high, with 88 percent of customers rating our 
services excellent, very good, or good. But we clearly 
recognize that we face current and future challenges in our 
ability to deliver timely, high-quality service to the public, 
and that we need to formulate concrete strategies to deal with 
these challenges.
    I would like to briefly describe the four major service 
delivery challenges we face and our plans to address them.
    First, increasing workloads associated with the aging of 
America are a central concern. Because the baby boom generation 
is aging and a large segment are in their late 40s and early 
50s, we estimate that over the next 10 years, our overall 
claims will increase by 23 percent, roughly double the level of 
increase in the 1990s.
    Second, while our workload and service delivery challenges 
before us are very real, our mission demands more than just 
faster service on applications for benefits, easier access to 
us by telephone, and shorter waiting times in our offices. We 
must balance our service mission with the need to be good 
stewards of the program that we administer.
    Stronger program integrity activities come with a cost. 
About one-quarter of our administrative budget, $1.7 billion, 
is associated with program integrity. In the past four years, 
staffing for our Inspector General has doubled, and an 
additional 4,000 State DDS and SSA work-years are now devoted 
to continuing disability reviews and redeterminations. While we 
have been taking aggressive action to strengthen program 
integrity, we have much further to go to address these areas.
    Third, SSA is only able to achieve high-level service 
through our greatest strength--a core of dedicated and 
professional employees. Since 1985, SSA has seen a 22-percent 
reduction in its workforce, with the vast majority of these 
losses occurring prior to 1993. To meet growing workloads over 
this time, we have reduced most SSA staff functions and put 
more resources in areas that directly serve the public.
    The challenge of serving the baby boomers will be affected 
by SSA's own upcoming retirement wave. We expect about 27,000 
SSA employees to retire by 2010, and an additional 8,000 to 
leave via early-outs, disability retirements, resignations, 
transfers, and deaths.
    And, fourth, all of this is occurring in an era of 
constrained Government resources. SSA's administrative budget 
represents less than 2 percent of the value of the benefits 
provided by the agency each year. Although we are proud of such 
efficiency, it is clear that SSA needs additional resources in 
the future. As I indicated in the 2000 SSA operating plan, some 
workload processing goals have now been reduced from levels in 
the 2000 budget plan, including service goals for the 800 
number, retirement and disability claims, hearings, and SSI 
redeterminations.
    As you know, Mr. Chairman, last September the Social 
Security Advisory Board issued a service delivery report. It 
recommended that SSA develop a short-and long-term service 
delivery plan, ensure that we have the human resources needed, 
improve current service practices and strategies, and address 
longstanding institutional problems. I would like to address 
briefly the actions the agency is taking to deal with these 
four broad areas.
    First, while SSA has one of the best planning capabilities 
in Government, I believe that we still can do more. We are 
developing a vision that takes SSA out 10 years. The 2010 
Vision is being developed with significant input from our 
customers, employees, representatives of unions, management 
associations, advisory groups, and experts in such fields as 
technology and communications. The 2010 Vision will be about 
the agency of the future, what work we will do and how we will 
do it. Once completed, this Vision will drive all of our 
budgeting and performance planning.
    Secondly, I recently released a report on workforce 
planning at SSA which provides an analysis of our most 
significant near-and longer-term workforce issues, and 
describes the strategies we plan to put in place to address 
them. We are currently in the process of linking our plans for 
responding to the pending retirement wave with our Strategic 
Plan, and we are implementing GAO's human resource 
recommendations. In addition, we are developing an integrated 
work measurement system that will provide more comprehensive 
information about the work we perform. The data from this 
system will permit us to make better resource allocation 
decisions and budget justifications.
    Third, while our overall service remains very solid, there 
are clearly areas where immediate improvement is needed. One 
major area in need of improvement relates to the administration 
of our disability program. We have already issued plans to 
improve the management of the disability programs, including 
plans to improve the initial claims process, the hearings 
process, and the Appeals Council process. Our efforts to 
strengthen the disability adjudication process are bearing real 
fruit. For those who go through all of the adjudicative steps, 
processing times have already dropped significantly, and 
further progress will be made in the future.
    Let me also briefly discuss emerging technologies. Over the 
last few years, SSA has been successful in using technology to 
improve the services we offer to the American public. In the 
1990s, technology allowed us to offer nationwide 800 number 
service, improve the timeliness and quality of the actions we 
take, and provide better overall service.
    As we move into the 21st century, Internet commerce has 
become mainstream and Americans are increasingly asking the 
public sector to provide electronic Government services. Today, 
SSA's Web site is primarily informational, but to meet consumer 
demand we will be developing a broader range of electronic 
services consistent with our long-term service vision, 
including secure authentication and privacy safeguards.
    With regard to our 800 number and our field operations, 
customer satisfaction levels for these services are high, and 
we are committed to strengthening the services we provide. But 
there are very real stresses. Consumer demands continue to 
rise, especially for our 800 number service, and teleservice 
center staff alone have not been able to handle the increasing 
call volumes. Additional resources from other agency components 
have been needed to assist with answering calls on busy days.
    Our field offices, which number 1,300, have been the center 
of our service delivery system since the creation of the 
program, and I believe they will be the center of our delivery 
system in the future. But there is stress in handling growing 
workloads in our field offices, and customer waiting times, 
particularly in our urban offices, are increasing.
    We are responding by putting a majority of our newly hired 
employees in our field offices and by seeking further 
automation improvements to enhance our productivity. But it is 
clear to me that our field workforce in the future will need 
higher levels of skill to handle increasingly complex work 
assignments such as return to work and program integrity 
activities.
    Finally, let me address the fourth area cited by the 
Board--longstanding institutional problems. The Board said SSA 
needed to find ways to promote more discussion of problems, 
strengthen communication between our field offices and 
headquarters, and promote better teamwork. These serious 
concerns face any large organization in the 21st century, and 
we need to do all we can to overcome barriers and increase 
communication. I am taking steps to increase communication and 
teamwork within the agency.
    In conclusion, let me again say that SSA is experiencing 
significant strains in our ability to continue to deliver the 
quality of service that the public has come to expect. We will 
be further challenged by the coming retirement wave not only of 
the Nation's baby boomers, but of our own employees. We are 
moving to meet these challenges, but resources are an important 
part of the picture. We cannot do our job without adequate 
resources, especially when more and more Americans will be 
seeking our services.
    Mr. Chairman, this subcommittee has always supported us in 
the past, and I look forward to your continued support in the 
future. I will be happy to answer any questions that you may 
have at this time.
    [The prepared statement follows:]

Statement of Hon. Kenneth S. Apfel, Commissioner of Social Security, 
Social Security Administration

    Mr. Chairman and Members of the Subcommittee:
    Thank you for inviting me today to testify about the ways 
in which the Social Security Administration serves the American 
public. I would like to thank this Committee for holding this 
hearing on an issue that is of great importance to SSA and 
commands a tremendous amount of our time and attention.
    Mr. Chairman, it is hard to fully describe the magnitude of 
our vast service responsibilities. But let me give you some 
examples. We are committed to providing the right benefit 
payment to the right person on time, and to do so over 600 
million times a year, which represents 50 million monthly 
payments to Old-Age, Survivors and Disability Insurance (OASDI) 
and Supplemental Security Income (SSI) recipients. On average, 
each workday about 100,000 people visit one of our 1,300 field 
offices and over 240,000 people call our 800 number. Each 
workday we process an average of 20,000 initial claims for 
retirement, survivors, disability or SSI benefits, and hold 
2,400 hearings before Administrative Law Judges (ALJs). Each 
year, we make certain that over 250 million earnings items are 
correctly credited to workers' accounts to ensure that future 
benefit payments are accurate.
    We take these responsibilities very seriously, because 
millions of Americans rely on us as they have for the past 65 
years. I say in all candor that my greatest pride as 
Commissioner is the spirit and commitment that our employees 
demonstrate each and every day in serving the American people 
and the high quality of service we provide.
    We have a long history at SSA of solid and reliable 
customer service. In fact, in 1999, customer satisfaction was 
at an all time high with 88 percent of customers rating our 
service as excellent, very good, or good. But we clearly 
recognize that we face current and future challenges to our 
ability to deliver timely, high-quality service to the public, 
and that we need to formulate concrete strategies to deal with 
these challenges. Let me assure you, Mr. Chairman, that we have 
an unwavering commitment throughout our agency to provide the 
American public with superior customer service, and we intend 
to translate that commitment into practice in every aspect of 
our service delivery.
    The Social Security Administration has been known for some 
time as a Government-wide leader in management, planning, and 
service to the American public. Just last year, the Maxwell 
School of Citizenship and Public Affairs of Syracuse University 
ranked SSA at the top of 15 Federal Government agencies in one 
of the most comprehensive studies of management performance 
ever conducted. But, in spite of these accolades, we, like all 
other public institutions, face significant demands, changes 
and challenges.
    Given the growing workload demands that we face, rapid 
changes in technology, expansion of our mission, continued 
resource constraints, and the prospects for a loss of our 
knowledge base as many employees become eligible for 
retirement, it is clear that we are facing significant strains 
on our ability to continue to deliver quality service to the 
public. Clearly, we need to address today's challenges and we 
need to plan better for the changes that confront us in the 
future. While we are taking steps to address today's 
challenges, we are also developing plans and establishing 
processes that will prepare us for the additional work that we 
will encounter later this decade as the ``baby boom'' 
generation begins facing disabling conditions or reaches 
retirement age. I believe that the Social Security 
Administration, with adequate resources, will meet these 
challenges, as we have in the past.
    Today, I would like first to discuss the challenges we face 
and then lay out how SSA plans to align itself to meet them.

                         THE CHALLENGES WE FACE

    We face a number of sizable challenges that I would like to 
highlight for the Committee--increasing workloads, an increased 
focus on program integrity, a smaller and aging SSA workforce, 
and tight resource constraints.

1. Increasing Workloads

    The Social Security Administration is experiencing 
significant strains due to increased workloads, and the aging 
of America will place even greater challenges on our ability to 
continue to deliver the high quality of service that Americans 
have come to expect from our agency.
    SSA's main workloads can be broadly grouped as follows:
     Processing of initial claims for retirement, 
survivors, disability and SSI benefits including appeals;
     Maintenance of beneficiary records for those on 
the rolls. This workload, which we refer to as ``post-
entitlement'' actions, includes continuing disability reviews, 
SSI redeterminations, and benefit recomputations;
     Establishment and maintenance of Social Security 
Number records; and,
     Maintenance of individual earnings records.
    Each of these categories reflects major workloads, but the 
vast majority of SSA's and the Disability Determination 
Services' (DDSs) workyears--more than two-thirds--are invested 
in processing initial disability claims and appeals for both 
Disability Insurance (DI) and SSI, and in various post-
entitlement actions for our disability programs.
    A sizable shift in our workload took place in the late 
1980's and early 1990's, with a dramatic increase in the number 
of claims for DI and SSI disability benefits. These grew from 
about 1.5 million claims processed in FY 1985 to about 2.6 
million processed in FY 1995. With a large portion of denials 
flowing into the appellate process, our hearing workload also 
increased dramatically, from about 250,000 processed in FY 
1985, to about 580,000 in FY 1996. On the heels of this 
dramatic growth in our ongoing claims and appeals work came 
significant legislative mandates and the large one-time welfare 
reform-related workloads of the mid-1990s. These included drug 
addiction and alcoholism reviews, childhood and noncitizen 
reviews, and rereviews. With all these increases, the 
corresponding backlog in disability claims dominated the 
attention of the agency for some time. As I will make clear 
later in my testimony, we had to make significant shifts in our 
workforce to deal with these demands.
    Because the baby boom generation is aging, and a large 
number of people are in their late 40's and 50's, our current 
estimates indicate that new claims for all types of benefits 
will increase over the next 10 years by 23 percent, from 6.3 
million to 7.8 million, roughly double the level of increase 
experienced in the 1990's. Our initial retirement claims 
workload will increase by roughly 21 percent by 2010, and our 
initial disability claims workload will increase by roughly 25 
percent by 2010.
    The workload of post-entitlement actions has grown by 
almost 25 percent over the past 10 years, from 80 million to 
100 million. Increases in this area are due, in part, to a 
growing focus on program integrity activities. For example, 
representative payee actions increased by 2.2 million over this 
period of time, and overpayment actions increased by 1.5 
million. In addition, the number of Continuing Disability 
Reviews (CDRs) we processed jumped from about 100,000 in FY 
1994, to over 1.7 million in FY 1999. By 2010, the post-
entitlement workload is expected to grow by at least 16 
million, in line with the projected growth in the numbers of 
beneficiaries on the OASDI and SSI rolls.
    In addition to the large volume of disability work we face, 
most of which is performed in our field offices, DDSs and large 
service centers, the work we perform in support of our national 
800 number at our teleservice centers has also increased 
dramatically over the last decade, from less than 30 million 
calls served in FY 1989 to almost 60 million served in FY 1999. 
The popularity of this service continues to grow, and we 
continue to seek ways to improve it to assure that we meet 
customer demand.
    In addition to the work we perform today, we need to be 
cognizant of the broader service missions that Social Security 
Administration will face in the future. Two key examples of 
challenges are service to our growing non-English speaking 
clients and implementation of the recently passed ``Ticket to 
Work and Work Incentives Improvement Act.''
    The number of our non-English-speaking customers will 
increase. The Census Bureau predicts that between 1995 and 
2005, the Nation's population will increase by 72 million 
people. Of these, 32 million will be Hispanics and 12 million 
will be Asians. SSA must provide services to our customers even 
if they cannot communicate with us in English. The change in 
the population will require us to hire more bilingual employees 
and to develop more written material in other languages.
    In December 1999, the President signed Public Law 106-170, 
``The Ticket to Work and Work Incentives Improvement Act of 
1999.'' This hallmark legislation, enacted with the strong 
support of this Committee, addresses some of the most 
significant barriers to employment of people with disabilities. 
Its key features greatly expand access to employment, training 
and rehabilitation service providers in the public and private 
sectors and provide access to health care protection for 
working people with disabilities.
    This new mission will entail a much greater degree of 
supportive services for a portion of our beneficiary population 
than we have provided in the past. Those support services must 
be delivered from our field offices and other settings, in 
close collaboration with a new set of external service 
providers.
    Up to now SSA has met its increasing workload demands by 
improvements in productivity through automation, movement of 
staff to direct service positions, shifting workyears to 
disability activities, increasing the use of temporary 
employment for welfare reform workloads, and use of overtime. 
But some of these actions have placed real strains on the 
organization. Two areas of serious strain that I will cover in 
more detail later in my testimony are as follows:
    First, the growth in disability claims led to sizable 
delays in service. Our efforts to improve service have placed 
real strains on the agency.
    Second, our field structure is under growing pressure to 
cope with workload demands. In order to deal with growing 
demands for our 800 number telephone service, we have had to 
utilize a growing share of staff at our Program Service Centers 
(PSCs) to help answer the calls, resulting in a backup of work 
in the ``postentitlement'' area. In addition, because of the 
growth in workloads coupled with downsizing through the 80's, 
and the shift to more program integrity activities, our field 
offices, particularly our urban offices, have become 
overextended.

2. Enhanced Program Integrity

    There is no doubt that the workload and service challenges 
before us are very real, but our mission demands more than just 
faster service on applications for benefits, easier access to 
us by telephone, and shorter waiting times in our offices. We 
must balance our service mission with our mission to be good 
stewards of the program we administer. We also must protect the 
trust funds and general revenues from losses associated with 
payment errors. The programs we administer, which are designed 
to meet critical needs for the public, can themselves be 
threatened if the public perceives serious problems in program 
integrity.
    Together, Congress and the Administration have launched 
several important initiatives directed at program integrity, 
and we have seen major dividends from investments made for this 
purpose. For example, Congress provided special funding 
authority for us to dramatically expand our CDR program, and 
the well-documented results of that effort have shown that it 
is extremely cost effective. As detailed in our most recent 
report to Congress on CDRs, SSA spent $462 million in FY 1998 
to process 1.4 million CDRs. The present value of future 
benefits saved from this effort was estimated to be $5.6 
billion in the Social Security, SSI, Medicare, and Medicaid 
programs.
    I believe that accuracy in our decisions is a paramount 
programmatic responsibility. Embedded in our commitment to 
provide world class service to our customers are measurements 
and enhancements that promote an accurate product outcome. For 
the most part, our continued reviews indicate there is reason 
for optimism. The accuracy of decisions in the Old Age and 
Survivors Insurance program and the effect of any error on 
dollar outlays have consistently been very good, exceeding 99 
percent. In fact, the systematic fixes and improvements we have 
made in postentitlement computations over the last few years 
have eliminated hundreds of thousands of errors.
    And, while we have an error rate of less than 1 percent, I 
should point out that roughly 70 percent of Social Security 
overpayments in the Old Age and Survivors program are due to 
the earnings test. While there will be short-term costs to 
implement the recent action by the House to repeal the earnings 
test at the normal retirement age, in the long term it will 
free up resources now spent on administering that provision and 
collecting overpayments. Also, from a policy standpoint, 
eliminating the earnings test at normal retirement age is the 
right thing to do. As the baby boomers begin to retire, it is 
more important than ever that older Americans who are willing 
and able to work should not have their Social Security benefits 
deferred when they do work.
    Because the administration of the Disability programs is 
more complex, there is more case error in the Disability 
programs, but accuracy trends there are also positive. In fact, 
during this past fiscal year, improvements were noted in every 
level of disability decision making for both awards and 
denials. A part of our plan for the long-term management of the 
disability program includes engaging the services of an 
independent consultant to assist us in assessing our quality 
assurance requirements and developing options for improvement.
    On another crucial front, I initiated a series of actions 
to attack the problem of the accuracy rate in the SSI program. 
The General Accounting Office (GAO) has designated the SSI 
program as ``high risk,'' and action was needed to turn around 
a trend of declining accuracy and growing overpayment error. My 
report on this issue, which was published in October 1998 (a 
copy of which will be provided for the record), outlined a 
series of actions we are pursuing to address this problem. 
These included: 1) increased numbers of redeterminations, 2) 
improved matching of our data with available records on wages, 
nursing home admissions, and financial accounts, and 3) a 
number of new anti-fraud and debt collection initiatives.
    I very much appreciate the support of this Committee and 
the Congress as a whole for supporting our SSI strategy. At the 
end of the last Congress, the new legislative authorities that 
we requested were provided. These included new penalties 
against those who provide false or misleading information or 
fail to report changes that affect benefit amounts, and new 
debt collection tools such as the expansion of offset authority 
for Title XVI to all Federal programs, as well as expanding 
incentive payments to prisons and other institutions that 
report inmates so SSA can suspend their Social Security 
benefits while they are confined.
    The actions outlined in the report are already showing 
results. For example, the data matches performed in FY 1999, 
the additional redeterminations and improvements in targeting 
these redeterminations to the cases with the most payoff are 
projected to ultimately save an estimated $600 million in 
overpayment collection and prevention at an administrative cost 
of well under $100 million.
    It must be emphasized that stronger program integrity 
activities come with a cost. In fact, $1.7 billion, or one 
quarter of our administrative budget, is associated with 
program integrity. Over the past few years, staffing aimed at 
strengthening integrity activities has increased. The Inspector 
General staff increased by more than 300 employees between FY 
1996 and FY 2000, thereby doubling in size. In the same period, 
an additional 4,000 DDS and SSA workyears have been devoted to 
conduct CDRs and redeterminations. While we have been taking 
aggressive action in the area of program integrity area, we 
have much further to go to address overpayments and other 
issues. We will be discussing this overall matter with you at a 
hearing later this month.

3. Our Workforce: Smaller, Higher-Skilled, and Older

    It takes well-trained employees to provide exemplary 
customer service. That means cultivating an environment in 
which our employees go one step beyond to meet the needs of our 
customers. I am proud to lead an organization of high-caliber 
professionals who make such a difference in the lives of all 
Americans and have a long tradition of providing excellent 
service.
    Since fiscal year (FY) 1985, SSA has undergone a 22 percent 
reduction in the size of its workforce, from a staff of 
approximately 81,000 full-time equivalents (FTEs) in 1985 to 
63,000 FTEs in 1999. The vast majority of these losses occurred 
prior to 1993. The staff of the Disability Determination 
Services in the States, on the other hand, has grown from 
13,000 in 1985 to over 14,600 today, a 12 percent increase. 
Most of these increases occurred since 1993.
    The graph below depicts the areas where the changes in 
staff occurred within SSA and the DDSs. A growing share of 
staffing has been devoted to disability adjudication to meet 
the sizable growth and complexity in our workloads in this 
area.

[GRAPHIC OMITTED]

    The Social Security Administration since 1993 has been 
largely spared from the recent downsizing that has taken place 
throughout the Federal Government. From 1993-1999 the Social 
Security workforce including the DDSs has declined by 2.2 
percent in FTE terms. Excluding the DDS, the SSA workforce has 
declined by 4.6 percent. During the same period, the total 
Federal civilian employment that has declined by 17 percent and 
total non-defense civilian employment declined by 9 percent.
    To operate within the staffing constraints we have had 
since 1993, we have focused on putting a growing share of our 
resources in areas that directly serve the public. SSA's 
priority was to preserve SSA's day to day operations. This has 
been accomplished by reducing most SSA staff functions 
(excluding the Office of Systems) by about 26% since FY 1993. 
We changed the staffing mix in our field offices to put more 
employees in direct service positions, and upgraded their 
skills. And we placed more people in investigative and audit 
functions, added more attorneys to deal with the litigation 
workload in the disability area, and increased the number of 
Administrative Law Judges and support staff to handle the 
increasing appeals caseload. We were able to offset some of 
these staff increases through reductions in clerical positions 
and other streamlining made possible by expanded automation.
    To further our goal of preserving direct service 
operations, we reduced supervisory personnel. The effort 
resulted in a 45 percent reduction in supervisors and an 
increase in the supervisor-to-staff ratio from 1:7 in 1993 to 
1:13 in 1999. Approximately 1,200 supervisors and managers left 
SSA through retirement or special initiatives. Others moved 
into nonsupervisory support positions that focus on process and 
service delivery enhancements, such as program integrity and 
automation activities. Reassessment of this configuration is 
now necessary to insure that we have the right support 
infrastructure for technical expertise and quality (in-line 
review, feedback, and training). This year, we are restoring a 
small number of supervisory positions and will assess whether 
an optimal balance has been found, particularly in our large 
urban offices. We are also looking at ways to provide 
incentives for candidates to apply for management positions in 
offices where we have difficulty recruiting.
    The challenge of serving the baby boomers will be affected 
by our own retirement wave. SSA will experience considerably 
higher levels of employee retirement losses over the next 
decade than previously experienced. The Agency predicts that 
about 27,000 permanent SSA employees will retire between 2000 
and 2010. These projected retirement losses include about 
20,000 operations employees, 3,000 hearing positions, and 1,200 
systems positions. Losses for 2000 through 2010 are projected 
to total over 35,000 when all categories of attrition are 
factored in, including early outs, disability retirements, 
resignations, transfers, and deaths.
    The diverse skills required of the workforce of the future 
will be different than those of today's workers. SSA must 
assess what skill mixes its future workers will need and ensure 
that we have the kind of high-technology training programs in 
place to permit lifelong learning.
4. Constrained Resources

    SSA's administrative budget represents less than 2 percent 
of the value of the benefits provided by the agency each year. 
Although we are proud of such efficiency, it is clear that SSA 
needs additional resources in the future.
    I understand that hard decisions have to be made on the 
distribution of finite resources. For example, the resources it 
takes SSA to answer a phone call or process a disability claim 
must be balanced against the resources needed for additional 
teachers, medical research and other critical public needs.
    SSA's administrative budget is primarily the cost of its 
employees. Our employees, wherever they are located, need to be 
reassured that adequate resources are available to them to do 
their jobs completely. I believe there is no more dedicated 
workforce than Social Security's. Their commitment to 
delivering world-class service is well-known and has been 
repeatedly affirmed by our customers and our employees 
themselves. But our employees also tell us that the workload 
stresses are taking their toll. I am committed to finding 
solutions to employee concerns as reflected in the results of 
recent employee surveys.
    This year has been a particularly challenging one for SSA. 
In November 1999, the Congress passed an appropriation bill 
which would have reduced the President's request for SSA's 
administrative costs by more than $200 million. I strongly 
supported the President's veto of that legislation. Such a 
substantial cut would have resulted in large disruptions in 
service that would have harmed millions of elderly and disabled 
Americans who depend on these critical programs for their 
support.
    For example, this large budget reduction would have 
required SSA to impose an immediate and complete hiring freeze, 
leaving 3000 positions vacant by the end of the year. This 
would have resulted in millions of calls to our toll-free 800 
number going unanswered and resulted in disability applicants 
waiting up to twice as long for a decision on their initial 
claims for benefits. And, waiting time for millions of 
Americans who visit Social Security offices each year would 
have increased significantly. Another effect of this budget cut 
would have been a reduction in SSA's increased efforts to 
ensure program integrity, ultimately costing the Government and 
taxpayers hundreds of millions of dollars.
    I was pleased that part of this reduction was restored, in 
part by funding some unbudgeted cost increases with unspent 
money from FY 1999. Still, when all was said and done, we wound 
up about $75 million short of what was needed to meet our 
promised service commitments. As I indicated in the FY 2000 SSA 
Operating Plan recently transmitted to Congress, a number of 
workload processing goals have now been reduced from the levels 
reflected in the FY 2000 Budget Plan. These include our service 
goals for the 800 number, retirement and disability claims, 
hearings, and SSI redeterminations.
    Mr. Chairman, to summarize, our four challenges are: 
increasing workloads; a need to make further improvements to 
program integrity; a changing workforce; and constrained 
resources. Let me now turn to a presentation of our best 
thinking about how we will align our processes, technologies, 
and our workforce to meet these challenges. But before I do, I 
let me note that despite of the volume of work we will face in 
the future, the Social Security Administration, with adequate 
resources, will meet these challenges as we have done in the 
past. We will meet the needs of our customers through our 
superior workforce and short and long term planning. And, we 
will of course need the support of this Committee to help us.

                 MEETING THE SERVICE DELIVERY CHALLENGE

    As you know, Mr. Chairman, in September 1999, the Social 
Security Advisory Board issued a report on service delivery and 
made recommendations on how SSA can improve service and better 
prepare for the long term challenges we will face. The Board 
recommended that SSA:
    1. Develop a short and long term service delivery plan;
    2. Ensure that it will have the human resources to carry 
out the service delivery plans;
    3. Make major improvements in a number of the agency's 
service delivery practices and strategies; and
    4. Address long-standing institutional problems.
    I would like to thank the Social Security Advisory Board 
for their work in this area. The Social Security Advisory Board 
Report provides a helpful guide to ensuring that the service 
that we provide will be strong in the future. The report's 
recommendations represent a challenge for us to create new 
strategies to satisfy our rapidly increasing customer 
expectations.
    I would like to present the Agency's approach to dealing 
with these four broad areas.
1. Service Delivery Planning

    The Social Security Advisory Board acknowledged SSA's 
position among Federal agencies as a leader in planning for the 
future. However, the Advisory Board concluded that SSA needs
    ``. . .to move quickly to deliver a service delivery plan 
that accurately reflects the agency's anticipated workload 
needs over the coming years and describes how the agency plans 
to meet these needs, whether through increases in resources, 
technological improvements, changes in the way the agency 
processes its work, or a combination of these approaches.''
    While SSA has one of the best planning capabilities in all 
of Government, I believe that we can still do more. Indeed, I 
view this as one of the highest priorities for SSA. Future 
customer expectations, rapid change in information technology 
coupled with the expected workload growth created by the baby 
boomers, and, simultaneously, a maturing workforce and limited 
resources, create the compelling need for the Agency to develop 
a vision that looks beyond our current 5-year planning horizon. 
We are developing a vision that takes SSA out 10 years. This 
vision, called the ``2010 Vision,'' will allow us to make 
better long-term investment decisions and to coordinate 
strategies and efforts toward long-term service goals. We can 
influence the direction of change only if we have a long-term 
vision of where we want to go.
    The ``2010 Vision'' will outline our view of service in the 
future, what work we will do in 2010 and how we will do it. It 
will describe how the Agency will respond to trends in our 
external environment that signal continuing rapid changes in 
society, particularly in the use of information technology. It 
will provide enough detail to shape the Agency's strategic 
plan, and drive our action plans and budgets to move us into 
the future.
    I see a real hunger within the Agency for a framework for 
meeting future customer expectations and service demands. The 
``2010 Vision'' is being developed with significant input from 
our customers, employees in headquarters, the field, the State 
agencies, and hearing offices, representatives of unions, 
management associations, advisory groups, and experts in such 
fields as technology and communications. The 2010 Vision will 
be about the Agency of the future--what work we will do, and 
how we will do it.
    While the 2010 vision will be fully integrated with the 
Agency Strategic Plan, it will be developed from the 
perspective of service as it should be, given workload, 
demographic and technology projections, and the expectations of 
our customers. Once the ``2010 Vision'' is incorporated into 
the Agency Strategic Plan and our overall direction is aligned 
with it, more detailed service planning will flow, including 
specific human resource and technology plans which will be 
designed to restructure and transition SSA to the requirements 
of 2010.

2. Adequate Human Resources

    The Social Security Advisory Board emphasized the 
importance of adequate human resources in carrying out our 
service delivery plan and the need to align our human resources 
with our service vision. They concluded that ``the agency 
cannot sustain any further reductions, and in fact now faces 
staffing shortages in key parts of the organization.'' Further, 
the Social Security Advisory Board recommends that SSA's 
administrative budget, like its program budget, should be 
explicitly excluded from the statutory cap that imposes a limit 
on the amount of discretionary Government spending.
    To adequately staff our field offices, we need timely and 
accurate information about all the work that needs to be 
performed and how long it takes to do it right. We are 
developing an integrated work measurement system to help us 
achieve this objective. By ensuring that all of our work 
measurement systems are fully integrated, not only will we be 
able to make better field office resource allocation decisions, 
we also enhance our ability to provide more detailed 
justifications for budget requests, provide better information 
to manage the flow of the agency's workloads, and expand our 
opportunities to perform the role of steward for the trust 
funds.
    SSA is fortunate to have an experienced and dedicated 
workforce that is highly committed to the Agency's mission and 
values. Our workforce represents one of the Agency's greatest 
strengths, but also represents one of our greatest challenges.
    While the experience and dedication of our workforce is a 
major strength, the approaching wave of retirements represents 
a significant challenge for us and for all of Government. The 
workforce challenges we now face grew out of the significant 
downsizing in the l980's that I discussed earlier. While we 
have been able to nearly stabilize staffing during the 1990's, 
much remains to be done to assure that SSA's workforce of the 
future is positioned to meet the workload challenges that lie 
ahead.
    Last month, I released a report on workforce planning at 
the SSA. The report provides an analysis of our most 
significant near-term and longer-term workforce issues, and 
describes the strategies we plan to put in place to address 
them. I have asked that a copy of the report be included in the 
hearing record.
    SSA's workforce planning efforts have been greatly enhanced 
as a result of the Agency's ``Retirement Wave'' study. This was 
a comprehensive study of attrition at SSA, focused on 
predicting the ``who, where and when'' of retirement losses. 
Based on our historical pattern, we developed a model for 
projecting how many employees we actually expect to retire in 
future years. The study predicts Agency retirements through 
2020, and has been remarkably accurate so far. Retirements are 
expected to peak in 2007 through 2009, when we expect to lose 
4.6 percent of our staff each year. At the same time, SSA will 
face unprecedented workloads as the baby-boom generation faces 
disabling conditions and ages. To handle these workloads we 
must have experienced employees in our key positions.
    While we have a number of initiatives underway to enhance 
our recruitment and training abilities, replacing staff now and 
in the immediate years to come is critical to having an 
experienced workforce on hand in 2007 and beyond.
    We can mitigate the effect of the projected peak year 
retirements by seeking to influence retirement behavior, in 
effect ``flattening the wave.'' This means moving retirements 
forward in time through early retirement programs and further 
minimizing the effect of retirements by approaches such as 
hiring Federal retirees to perform limited work. These ``early 
outs'' also allow us to adjust imbalance between workload and 
overhead functions to provide better customer service.
    During the last four years, SSA has offered early 
retirement to its employees. About 5 percent of those eligible 
for early retirement took it; (524 in 1996, 825 in 1997/1998 
and 1,381 in 1999).
    These early retirements significantly raised the total 
number of retirements and made up an increasing percentage of 
the total retirements each year it was offered. In 1999, early 
retirements accounted for 50.5 percent of all retirements. 
Later this year, we will offer another early out opportunity 
and by the close of the fiscal year we expect to hire 2,000 new 
employees.
    Adequate funding is critical not only to meeting current 
workloads, but also to building the workforce of the future. By 
accelerating our recruiting and training now we will ensure 
that we have a sufficient, well-trained and experienced staff 
to provide high-quality, timely service to the public.
    As our workforce report indicates, to prepare for the 
future we have put into place a number of training and 
development initiatives as part of our succession planning 
activities. We are also currently in the process of linking our 
plans for responding to the pending retirement wave to our 
Agency Strategic Plan, and are implementing GAO's human 
resources recommendations.
    After the release later this year of the 2010 Vision and 
our next Agency Strategic Plan, we will produce human resource 
plans consistent with our longer-term vision. We are already 
beginning analyses and activities that will form the basis for 
these plans. Americans can be confident that we have credible 
plans for dealing with what's ahead, and that our 21st century 
SSA workforce will be equal to the nation's highest 
expectations.

3. Service Practices and Strategies

    The third area the Board focused on was improvement in our 
service delivery practices and strategy. Under our current 
five-year strategic plan, one of our five major goals is to 
deliver ``world-class'' service. I agree with the Board's 
conclusion that we need to develop new strategies and practices 
in order to better meet this goal. I consider this to be one of 
our major challenges, and one that needs to be addressed 
forthrightly.
    We know that the first step in providing world-class 
customer service is listening to customers--listening to them 
tell us what they want and expect from our service, instead of 
assuming we already know. While we have done a good job 
listening in the past through use of focus groups and surveys, 
we know we have some information gaps.
    In 1998, we used the expertise and recommendations of an 
outside consultant to formulate a new data collection program, 
which we call our Market Measurement Program. The Market 
Measurement Program establishes a coordinated and comprehensive 
``state of the art'' program for collecting data on the needs, 
expectations and satisfaction of all our major customer groups. 
The Market Measurement Program also provides us with 
information from other groups who play a major role in the 
success of our service delivery-our employees and major 
stakeholders.
    Let me tell you some of the things we have learned from our 
customers so far. One thing we know is that telephone access 
and field office waiting times have a major influence on how 
customers perceive satisfaction with all other aspects of 
service, like courtesy and knowledge of employees. We also know 
that customers are more satisfied if the business they conduct 
with us is completed at the initial contact. And we know that 
improving the clarity of our notices provides one of the 
greatest opportunities for us to increase overall satisfaction. 
Because we know these areas are important to customers, we have 
Agency initiatives focused on all of them.
    We have many initiatives in place and plan to enhance and 
expand the way we gather feedback. These are described in a 
report I released earlier this week. I have asked that a copy 
of the report be included in the hearing record. Because we 
recognize that we still can do more to improve, we plan to work 
together with the Social Security Advisory Board on an effort 
to learn from the private sector, how best to collect and use 
customer service information to improve service delivery. We 
will use what we learn to help us improve our service to the 
public.
    While our overall service remains very solid, there are 
clearly areas where immediate improvement is needed. I would 
like to highlight three areas the Social Security Advisory 
Board identified and which I agree need more attention--
strengthening the operation of disability related services, 
using new technologies in conducting our work, and 
strengthening the 800 number and the field offices.

    Disability Program

    One major area in need of improvement relates to the 
administration of our disability program. In March 1999, I 
issued a report entitled, ``Social Security and Supplemental 
Security Income Disability Programs: Managing for Today, 
Planning for Tomorrow.'' This report is a comprehensive plan to 
improve the management of the disability programs and includes 
decisions on aspects of disability redesign, improvements in 
the hearings process, and enhancing return to work. It also 
addresses improving information technology, quality assurance 
and integrity, and research and studies to build a knowledge 
base for the future. I have asked that a copy of this report be 
included in the hearing record.
    Over the last few years, the Agency has embarked on an 
ambitious series of initiatives to improve the administration 
of the DI and SSI programs. In particular, SSA devoted 
considerable time and energy to its Disability Redesign Plan. 
The plan outlined a vision of a disability process designed to 
be more accurate, timely, and ``user-friendly.'' Tests of 
redesign concepts have shown the potential for improving 
customer service by focusing more attention at the initial 
claims level to improve quality, reduce hurdles and increase 
customer interaction--all concepts that epitomize the 
principles and goals of the National Partnership for 
Reinventing Government (NPR). A major strategy of the NPR is to 
achieve outcomes that balance business results, customer 
satisfaction and employee satisfaction. SSA is committed to 
that strategy, and in that spirit, the Disability Redesign 
project has moved from ``proof of concept'' tests to prototypes 
in 10 States.
    SSA is prototyping changes that will improve the disability 
process to ensure that decisions are made as accurately as 
possible, that those who should be paid are paid as early as 
possible, and that the adjudication process is consistent 
throughout. Beginning in October 1999, disability claims filed 
with SSA were decided using a new disability process in 
prototype locations. Changes include improvements in 
accountability for the decision making process and more 
effective use of physician and non-physician resources, 
requirements for DDS employees to explain how they made the 
disability determinations, increased opportunities for 
claimants to interact with the adjudicator and elimination of 
the reconsideration step. These are dramatic changes to the way 
we have been adjudicating initial disability claims, and to 
date, we have been pleased with the outcomes. Nevertheless, 
imperfections in the new process exist, and we continue to make 
refinements and adjustments. Prototype evaluation results are 
expected later this year.
    We are also testing a Disability Claims Manager (DCM) 
process in which we have combined the functions of the claims 
representatives in the SSA field office with the functions of 
the disability examiner in the DDS. The DCM provides a single 
point of contact for the disability customer by conducting the 
interview, developing the case and making the disability 
determination.
    While the focus on initial claims is on improving the 
quality--of decisions, the focus of changes in the hearings and 
appeals process is on processing times. The current hearing 
process is based on a model developed years ago that served SSA 
well as long as receipts were stable and SSA could add 
resources if necessary. However, with a sharp increase in 
appeals (over 100% from the mid-1980s to the mid-1990s), SSA 
found that the current process was not flexible enough to 
handle the workload. The backlogs grew and processing times 
climbed.
    In August 1999, I issued a Hearing Process Improvement Plan 
(HPI). The goals of HPI are to reduce processing times, 
increase productivity and provide better overall service to the 
public. The HPI process will also give us the flexibility we 
need to handle the increase in receipts that are expected as 
the baby boomers continue to age. As of January 2000, 37 
hearing offices, generally corresponding to the 10 prototype 
States, have been selected to process cases under the new 
procedures. About half the remaining offices will implement HPI 
beginning in October 2000, with the balance starting in January 
2001. Our ultimate goal is to take Social Security hearing 
processing times down from 365 days, the level in 1998, to 180 
days in 2002. I am pleased to report that we are well on our 
way toward addressing this goal. At the close of January of 
this year our average processing time was just over 260 days.
    The Appeals Council provides the final level of 
administrative review for claims under the Social Security Act. 
The Appeals Council is also responsible for overseeing the 
preparation of the administrative record filed in Federal court 
proceedings and for initiating further administrative actions 
as required by those court proceedings. As a result of its 
burgeoning workloads, processing times at the Appeals Council 
have reached unacceptably high levels.
    We have just released the Appeals Council Process 
Improvement Plan (ACPI) which focuses on reducing pending 
workloads and processing times in the near term and developing 
an operational structure that can continue to deliver high-
quality, timely and efficient case processing for the long 
term.
    Our efforts to strengthen the disability adjudication 
process are bearing real fruit. For those who go through all of 
the adjudicative steps processing times have dropped 
significantly, and further progress will be made in the future. 
The following chart shows projected processing time before and 
after implementation of the Disability Management plan, 
including additional improvements projected from the ACPI.
[GRAPHIC OMITTED]

    Our actions in this area are clearly improving customer 
service. But more improvements will be needed to meet the 
challenges of the aging baby boomers. We will need to develop 
further steps to improve the Disability adjudication process 
once our ``2010 Vision'' is complete. The vision will guide us 
toward a longer term approach to making the process the best it 
can be.

    Emerging Technologies

    A second area of emphasis for improving service delivery is 
the use of emerging technologies. Over the last few years, SSA 
has been successful in using technology to improve the services 
we offer to the American public. In the 1990s, technology 
allowed us to offer enhanced nationwide 800 number service, 
improve the timeliness and quality of the actions we take, and 
provide better overall service to the public.
    We are now nearing the completion of our Intelligent 
Workstation Local Area Network (IWS/LAN) initiative that is 
putting a networked personal computer on every front-line 
employee's desk. We are currently planning to upgrade some 
software applications that will result in significant 
improvement in our service delivery. The Customer Help and 
Information Program is a decision-support system that our 
teleservice representatives use to ensure we give accurate 
answers and take appropriate actions. Our Processing Centers 
are beginning to use a new Paperless System that makes a 
client's record available at the employee's fingertips and 
eliminates the cumbersome routing and maintenance of paper 
folders. And, we are piloting new uses for this IWS/LAN 
platform that can significantly improve the services we offer 
to our customers with disabilities.
    As we move into the 21st century, the Internet has become a 
central business channel for America. Internet commerce has 
become mainstream and Americans are increasingly asking the 
public sector to provide electronic Government services. In 
response, SSA is in the planning stages of developing a full 
range of Internet services for the general public and our 
business partners. As electronic services expand, we are fully 
committed to prudent authentication and security technologies 
to protect the privacy of the information with which we are 
entrusted.
    At SSA, our award-winning Social Security Online Web site 
has been in place since May 1994. Last year almost 10 million 
customers visited our site, double from the year before. Today, 
our web site is primarily informational, providing a variety of 
forms, pamphlets, news, benefit information, research and 
statistics. We will continue to add informational services. 
Last month, we began issuing an electronic newsletter called E-
News that covers a variety of Social Security issues. However, 
our online surveys show that our customers want a much broader 
range of electronic services. To meet this demand, we will be 
developing services that meet the needs of particular customer 
segments. We are continuing to examine innovative ways to use 
the Internet to improve service to the public.
    At the Office of Hearings and Appeals (OHA), we developed 
and tested the use of video teleconferencing technology to 
conduct hearings with claimants, representatives or expert 
witnesses who are located somewhere other than a hearing 
office. Video teleconference hearings not only reduce travel to 
remote sites, they also make it possible to quickly shift 
workload from one office to another to provide faster service. 
There are numerous other applications we are exploring, 
including claimant conferences and serving Native Americans on 
reservations.
    While we believe that we are making good use of current 
technology we recognize that the future holds even greater 
promises. As part of the development of our ``2010 Vision'' we 
will be consulting with experts in the field who will help us 
assess how emerging technologies can play a much stronger role 
in our service delivery structure. Following publication of the 
``Vision'' we will be developing information technology plans 
consistent with our long-term service vision.

    800 Number and Field Offices

    The third area of focus for improving service delivery 
relates to improvements in our field activities including our 
field office, 800 number and processing centers. Overall, while 
service is solid, there are real stresses in all three. In 
1999, we handled nearly 60 million calls over our 800 number 
and our access rate exceeded our goal of answering 95 percent 
of the calls within 5 minutes. Perhaps even more important, 80 
percent of customers we surveyed were satisfied overall with 
the service that they received. Seventy-five percent of our 
customers also told us that their transaction was competed on 
the first call and 90 percent of our 800 number customers were 
pleased with the level of courtesy they received. And finally, 
our quality assessment reports show that our accuracy rate on 
questions concerning payments is over 95 percent.
    Although those numbers indicate good service overall, 
customer expectations for service continue to rise. There is 
clearly room for improvement and the Agency is taking steps to 
improve service. For example, to improve ease of access, we are 
increasing the number of people available to answer calls and 
we are improving our technological infrastructure. On the 
personnel side, we have increased the tour-of-duty for part-
time Teleservice Representatives, established call-answering 
positions in the Program Service Centers, and established a 
cadre of customer service technicians to answer calls in the 
Wilkes-Barre Data Operations Center. On the infrastructure 
side, we are procuring what is considered to be the most 
sophisticated call routing software available in the industry. 
We are also acquiring new call handling equipment and new 
technology to assist with the accurate forecasting of calls to 
increase the efficiency of our operations. We will need to 
strengthen the training of our Teleservice Representatives to 
maintain and improve their high level of knowledge and their 
skill in responding to the public.
    While public demand for telephone service has been 
increasing, TSC staff alone have not been able to handle the 
increasing call volumes, and additional resources from other 
Agency components have been needed to assist with answering 
national 800 number calls on busy days. For example, on days 
when heavy call volumes are anticipated, Program Service Center 
(PSC) and Office of Central Operations (OCO) personnel, known 
as SPIKEs, are brought on the phones to supplement TSC call 
answering resources. Currently, the national SPIKE cadre is 
comprised of approximately 3,200 PSC and OCO employees. SPIKE 
employees handled 24.6 percent of the National 800 Number 
Network calls in FY 1999.
    When SPIKE employees answer National 800 Number Network 
calls, it affects PSC pending workloads. To reduce this impact, 
a number of short-term initiatives have been developed to 
expand the National 800 Number Network call answering capacity 
in a manner that will provide PSC employees more time to work 
on pending workloads, without sacrificing the level of service 
provided to the public.
    Because of constrained resources and the need to address 
PSC backlogs we have had to lower our access goal from 95 
percent of callers who reach us within five minutes to 92 
percent. While additional resources would help significantly in 
improving access, part of what we must do with the 800 number 
involves working more efficiently and utilizing the best 
industry practices. We will be consulting with the private 
sector to determine whether our customer service standards 
should be strengthened and how to make further improvements. 
One issue we are considering is whether extending the hours of 
service provided by the 800 number is economically feasible and 
beneficial to our customers.
    Our 1300 field offices have been the center of our service 
delivery system since the creation of the program and I believe 
they will be the center of our service delivery system in the 
future. Most customer contacts as well as most of our Agency 
integrity activities take place in our field offices.
    While customer satisfaction in our field offices remain 
high and the commitment of our workforce to customer service 
goals remains high, the price of that service is also high. Our 
employee surveys show that our field office employees are 
experiencing increasing stress in handling the workloads. 
Waiting times in offices, particularly in urban areas are 
increasing. The sizable reduction in field office staff in the 
1980's led to few new hires, and our field office workforce is 
aging. Fifteen years ago, the average age of our field employee 
was 39 years, while today the average age is 46.
    To better meet the short-term challenges in our field 
office, the agency has instituted a number of important steps. 
The most important has been hiring new employees to ensure that 
our workforce is strong in the future. A sizable majority of 
new hires in FY 1999, FY 2000, and FY 2001 have been and will 
continue to be in our field offices. We are also exploring ways 
to strengthen our urban offices, where waiting times are 
longer. And our automation improvements have helped and will 
continue to help relieve some administrative burdens. In 
addition, the planned improvements in our workload measurement 
system will help us make better resource allocations.
    It is clear that some of the field office workloads, 
particularly in the retirement programs, will be eased as 
further automation and Internet improvements are implemented. A 
key feature of the 2010 vision is to articulate the roles and 
responsibilities of our field offices and our 800 number in the 
new technological era. It is clear to me that our field 
workforce in the future will need higher level of skills to 
handle increasingly complex work assignments, such as return to 
work and program integrity.

4. Longstanding Institutional Problems

    The fourth area highlighted by the Social Security Advisory 
Board relates to institutional improvements to improve the 
Agency's public service. The Board concluded that it is 
essential for the agency to find ways to promote more 
discussion of problems, strengthen communication between SSA's 
headquarters and operations in the field, and promote far 
better teamwork.
    Due to the inherent complexities and size of our programs, 
we understand that over time barriers developed within our 
organizational structure. While these issues are inherent in 
any large organization, we need to do all we can overcome 
barriers and increase communication. The agency needs to extend 
its ongoing dialogue between management and employees, 
headquarters and field offices, and our hearing offices and 
State agencies. To this end we have established quarterly 
workload meeting to talk through issues. And the development of 
our ``2010 Vision'' involves representation throughout the 
Agency.
    Employee surveys also indicate that there is a need for 
better communication between management in Headquarters and 
employees who work in the field and throughout all of SSA. I am 
committed to continue to work to strengthen lines of 
communications and to focus on fostering open feedback for all 
levels of the organization. I am encouraged by survey results, 
which indicate that employees consider their work important to 
SSA's mission. The survey results also make it clear that much 
needs to be done to relieve everyday stresses that employees 
feel as a result of the resource constraints we face.
    We are also working in partnership and communicating well 
with the unions that represent our employees. We have 
established more than 60 Partnership Councils, at all levels of 
the Agency, with the American Federation of Government 
Employees (AFGE). The purpose of these partnership councils is 
to help improve SSA's efficiency and effectiveness so that we 
can better serve customer needs. Through partnership, we have 
begun to shift the focus of the labor-management relationship 
from adversarial to one of cooperation and mutual respect.
    I also know that it is essential that our ``2010 Vision'' 
becomes part of the culture of SSA. The entire agency must be 
aligned with the 2010 vision. To meet this goal, we must 
communicate this vision throughout SSA, and put practices into 
place to steer the agency toward it. This means integrating the 
vision into our business processes, and our resource requests. 
I realize that we face an enormous challenge in attempting to 
achieve this alignment within such a large organization, but I 
am aiming high. Our service delivery structure, our human 
resources, our technology and our fiscal resources need to come 
into alignment with the vision.

Conclusion

    Mr. Chairman, we appreciate Congress' lead in holding these 
hearings focusing on our service delivery challenges. While the 
Social Security Administration has a long history of solid and 
reliable service delivery, we are experiencing significant 
strains on our ability to continue to deliver the quality of 
service that Americans have come to expect. We will be 
challenged to meet the growing demands of the coming retirement 
of the Baby Boom generation and many of our own employees, as 
well as enhancing the program integrity and dealing with 
constrained resources.
    I am pleased to tell you we are moving on many fronts to 
meet the challenges of the future. We are developing a long-
term service vision to take account of how our customers want 
to receive service in light of changing needs and changing 
technology. We are engaged in short and long term human 
resource planning. We are reviewing and where necessary 
revising our service practices and strategies and we are 
addressing longstanding institutional problems. We recognize 
that we need to continue to refine our plans through 
consultations with Congress, the Advisory Board and experts 
across the country.
    It is clear to me that adequate resources are a critical 
part of our ability to deal with the challenges we face. SSA 
cannot do its job with fewer and fewer resources when at the 
same time more and more Americans will be seeking our services. 
Mr. Chairman, this Subcommittee has always supported us in the 
past and I look forward to your continued support in the 
future.
    [Attachments are being retained in the Committee Files.]

      

                                

    Chairman Shaw. Mr. Matsui?
    Mr. Matsui. Thank you, Mr. Chairman.
    The fiscal year 2000 budget, Mr. Apfel, if I recall 
correctly here--your request for 2000 was $6.9 billion, and 
that was actually some $200 million over the President's actual 
recommendation. And then the Congress appropriated $6.5, some 
$400 million below your original request and some $200 million 
below the President's request. That is the fiscal year 2000 
budget.
    The fiscal year 2001 budget is pending obviously. My 
understanding on the budget resolution is that it is probably 
ready to go next week from the Budget Committee. And from what 
I understand, there would be a reduction below the current 
fiscal year 2001 of $1.2 billion. Is that correct?
    Mr. Apfel. Well, I believe that there is an estimate of a 
10-percent across-the-board cut from the President's request. 
It would be $1.4 billion below the Commissioner's budget 
request and $1.2 billion below the President's budget request 
if it is assumed that the action taken in the end is a 10-
percent across-the-board cut.
    Mr. Matsui. So it is based on a 10-percent across-the-board 
cut?
    Mr. Apfel. That is the assumption.
    Mr. Matsui. Should that happen, what would be the situation 
in terms of your actual work-years? Would there be a 
significant reduction, and would you be required to furlough 
some of the Social Security Administration employees?
    Mr. Apfel. Mr. Matsui, if I could first address 2000 and 
then 2001, when all was said and done, after all the actions 
that were done, we did lose money. Our full requests were not 
provided and we had to lower the service commitments that we 
had made on a series of activities--the 800 number, our 
redeterminations, several other areas. We had to actually lower 
our performance requirements.
    If the Social Security Administration did lose somewhere 
between $1.2 and $1.4 billion, it would effect somewhere in the 
vicinity of 16,000 of our work-years. It would mean an 
immediate hiring freeze and probably a furlough of about 45 
workdays. Now, that would have a sizable effect on all of our 
work, every bit of our work.
    There would probably be somewhere in the vicinity of 1,000 
fewer work-years on our 800 number, which would lead to the 
phones being busy for probably half the time. There would be 
probably 3,000 fewer work-years for our redetermination work, 
which is part of our program integrity activities, because we 
would want to be handling as many people coming in for 
applications as possible. So the backlogs would be dramatic in 
our post-entitlements and in our program integrity activities.
    And, third, the disability area would be significantly 
affected, probably somewhere in the vicinity of 10,000 work-
years since so much of our work is disability-related. That 
would mean very long waiting times for the disability area, 
particularly at the front end. It wouldn't be quite as drastic 
at the hearings level because not as many cases would be 
leaving the State disability systems. So the impact would be 
major and very detrimental to the American public.
    Mr. Matsui. Would this have an impact in terms of your 
long-term planning which you referred to in your statement 
regarding the disparity between the fact that your workforce is 
aging and that the workload will increase significantly over 
the next 20, 30 years? Where would you find your projected 
savings? I know the day-to-day, but would this impact some of 
the long-term planning?
    Mr. Apfel. Well, if funding for the Social Security 
Administration were going to be significantly reduced for the 
long term, it would have a very significant detrimental effect 
on our ability to provide service. It would take a dramatic 
rethinking about what our service levels could be for the long 
term.
    One of the challenges that we face includes serious short-
term issues. But in the long term, given those increases in the 
retirement wave and the increasing onset of disability for baby 
boomers, inadequate funding would have a very significant 
detrimental effect on SSA services and would certainly cause, I 
think it is fair to say, our long-term planning effort to be 
turned on its head.
    Mr. Matsui. Thank you. My time is expired. Thank you.
    Chairman Shaw. We have been working with the administration 
and the appropriators in trying to be sure that we do 
sufficiently fund the Social Security Administration. I think 
that is something that all of us on both sides of the aisle are 
very concerned about.
    Mr. Johnson?
    Mr. Johnson. Thank you, Mr. Chairman.
    Let me carry on with that. I know you have established 
performance measures. When was the last time you compared your 
performance measures with world-class organizations, as the 
President has asked you to do?
    Mr. Apfel. Well, our ongoing market measurement program 
system, which we just released a report on this week, is based 
upon a whole new way of trying to assess our customers' 
information, and we have done quite a bit of added customer 
service survey information.
    I would point out that the lessons that we have learned 
from that are that people want to be served as quickly as 
possible. They want to be able to get served the first time 
they come into our offices or call us on the 800 number, if we 
can complete those actions.
    What we also plan on doing, Mr. Johnson, is to convene a 
group of private sector experts to talk about how customer 
satisfaction is measured to see what we could do to make 
further improvements in our system.
    Mr. Johnson. Well, you are doing a lot of messing around, I 
guess I could call it, but to what degree are you consulting 
with outside technology experts to try to improve your 
programs?
    Mr. Apfel. Outside technology experts?
    Mr. Johnson. Yes.
    Mr. Apfel. Actually, I can't agree about messing around, 
Mr. Johnson.
    Mr. Johnson. Well, it seems to me from your answer that you 
are doing a lot of surveying. What are you doing with the 
results, and how are you making changes in your programs to be 
more efficient and to deliver your product to the people?
    Mr. Apfel. Let me give you two or three examples, sir, 
because I think it is very important. What we have heard from 
our customers is they want to be served quickly. They want to 
be served when they first call us or go into our field offices 
and to have that transaction be completed the first time that 
they come in.
    We have also heard from our customers that our notices 
create a lot of confusion and that clarifying notices is a very 
important activity. We have also heard from our customers--
    Mr. Johnson. Well, I am told, if I can interrupt you for a 
moment, that a lot of your notices, for example, come out of 
Baltimore and they aren't copied to your regional offices. And 
so employees go in and don't know who is where or in other 
words, who is on first.
    Mr. Apfel. That is a key issue that I believe that we are 
now in the process of addressing, so that our field employees 
and our 800 number employees can get through the computer any 
notice that was sent to an individual pulled up on their 
computer screen.
    Up until recently, if an individual came in or called us 
and said, I got this letter our employees would say, well, can 
you show or read me the letter, because they wouldn't have the 
information. One of our major objectives is to find ways to 
both improve the notices, and the ability of our field and 800 
number workers to be able to access immediately on their 
computer screens what notice information individuals have 
received so that they can address those concerns.
    Mr. Johnson. Well, are they all trained to do that now?
    Mr. Apfel. Well, I think--
    Mr. Johnson. We have been doing that in Congress for 5 
years.
    Mr. Apfel. I think that we have a remarkable workforce. Is 
there need for more training? Yes, and actually there was a 
national survey done at the Federal level of employee 
satisfaction, and Social Security shows up higher on training 
than the other Federal agencies. But it is still too low, in my 
opinion. We need to do more training to ensure that our 
employees have the right skills.
    Mr. Johnson. Well, that gets back to the question that I 
originally asked you. Are you using any outside technology 
experts to try to improve your system or are you just doing it 
in-house?
    Mr. Apfel. In two ways, we are reaching to the private 
sector. Through our 2010 Vision, trying to establish our long-
term service vision, we are talking to technology experts about 
what technology changes are going to be coming in the future so 
that we can build that into our long-term vision of what we 
need as an agency.
    And, second, this summer I intend to convene a group of 
private sector experts on measurement to try to find ways that 
we can improve our system. I think we have made excellent 
improvements to our system, but we can do better. We can learn 
more from the private sector and that is my goal, sir.
    Mr. Johnson. Well, I appreciate that. I think you are 
right. You know, the private sector seems to know how to do it 
better, and for some reason the Government can't emulate them 
in every case and I think it is incumbent upon us to take a 
look at what is going on in the private sector. There is no 
pride in authorship is what I am trying to say.
    Mr. Apfel. There is not, Mr. Johnson. It is clear that we 
can learn more lessons than we have. It is also clear that 
resources are going to be part of our equation, ensuring that 
we have the resources that are necessary to build the systems 
that we are going to need, and to ensure that our workforce has 
the training and the capabilities that they need to provide 
service to the public.
    Part of the answer will be resources, part will be dealing 
with the private sector about helping us find better ways to do 
activities, and part will be ultimately the commitment that we 
have with this committee to help us get our job done.
    Mr. Johnson. Thank you, sir. Thank you, Mr. Chairman.
    Chairman Shaw. Commissioner, as a follow-up on Sam's 
question with regard to the letter that has been written, at 
what point would somebody be able to come into a field office, 
say, in Fort Lauderdale and they would have a copy of whatever 
letter that this person has?
    Mr. Apfel. On the screen?
    Chairman Shaw. Yes, sir.
    Mr. Apfel. In other words, whether the screen will have 
that actual notice?
    Chairman Shaw. When is that going to happen?
    Mr. Apfel. With our chip and other technology improvements 
that are onstream, I am going to have to get back to you as to 
how many months that is going to be. Some steps are completed, 
and others will be done in the near term. This is not in the 
long term, this is very much in the near term, and I will 
provide a specific date for the record.
    Chairman Shaw. All right, if you would. Within a year? Is 
that--
    Mr. Apfel. That is our goal. I think on many of the 
notices, are already there, but I will have to get you the 
actual date.
    Chairman Shaw. We would appreciate that for the record. 
Thank you.
    [The information follows:]

    The Online Notice Retrieval System, which was first 
available for testing in May 1998, was fully implemented 
throughout the Social Security Administration in November 1998. 
This system, as tested and implemented, allows field office and 
teleservice center employees access to virtually all Social 
Security and Supplemental Security Income notices created by 
SSA systems. 

    Chairman Shaw. Mr. Levin?
    Mr. Levin. Welcome.
    Mr. Apfel. Mr. Levin.
    Mr. Levin. The agency has received such good grades on your 
report card, I hesitate a bit to ask questions. But since we 
always ask questions of our kids even if they receive As or 
whatever, let me ask you a few questions, and it most relates 
to the appeals process because in our office, as we handle 
Social Security matters, there seem to be more problems in that 
area than any other.
    And I am not sure I have the procedures down as well as I 
should, but like one case--there were several that were given 
to me--a case was filed 2-25-97 and denied 1-21-98, a 
disability case. It has been at the Appeals Council since the 
2nd of February, 1998, so that would be 2 years-plus, right?
    Mr. Apfel. Yes.
    Mr. Levin. Now, is that somewhat typical? I mean, is there 
a real problem?
    Mr. Apfel. I believe that the biggest problem that faced 
the Social Security Administration over the past decade has 
been in the area of disability adjudication. If I could provide 
background for a moment and then go specifically to the Appeals 
Council, I will.
    First, look at Social Security staffing and our workloads. 
Given the increase in disability cases, there was a significant 
shift within Social Security over the course of the last 10 to 
15 years in the amount of workforce devoted to both disability 
adjudication and to appeals. The backlogs grew very 
significantly, and when I became Commissioner SSA had what I 
believe was an intolerable situation--we needed to do more to 
expedite these appeals, both at the Appeals Council level, at 
the administrative law judge level, and really at the DDS 
level, the State disability determination level, as well.
    As my testimony indicates, the Appeals Council delays had 
grown to an average of about 460 days. We have now developed 
concrete, solid plans for strengthening the State disability 
structure, the administrative law judge structure through our 
hearings process improvement, and just this week we released 
our Appeals Council improvement plan.
    It is our goal, by 2002, to bring that 460 days down to 160 
days, and by 2003 to get it down another month below that, back 
into the area that I believe is appropriate service. That has 
taken a whole series of steps that are now being implemented, 
both by shifting resources and adding resources--part of my 
budget request for 2001 is for some added resources for this 
activity. Some excellent steps are being taken by our managers 
to take on some of the actual case activities. There are a 
series of steps that will significantly drive down that number.
    I believe we are seeing real improvement in the disability 
area. There is a long way to go, but we have taken some very 
important steps. This is the area that has dominated a lot of 
my time as Commissioner, and will for many years into the 
future. But I believe we are on the right path both in the 
appeals area, the administrative law judge area, and in the 
disability determination area at the State level.
    Mr. Levin. Well, so let me finish by asking you, Mr. Matsui 
discussed with you the budget, so what are the implications for 
your plans from possible actions and potential reductions in 
the budget? I mean, what happens if we make some major cuts?
    Mr. Apfel. If there are sizable reductions, we will not be 
able to do the performance improvements that we have committed 
to in our service plan. That would be true in the short term 
and it would certainly be true in the long term.
    Mr. Levin. And very much related to the appeals process, to 
the improvement in the appeals?
    Mr. Apfel. I believe we could still move forward on the 
improvements that are underway, but if we had a sizable 
reduction and weren't hiring staff, we would have fewer people 
to actually handle the cases at the State level; fewer staff to 
help the administrative law judges, and fewer administrative 
law judges, fewer staff at the Appeals Council as well. It 
would certainly have an effect on our ability to be able to 
shorten our processing times significantly.
    Mr. Levin. Thank you.
    Chairman Shaw. Mr. Hayworth?
    Mr. Hayworth. Thank you, Mr. Chairman. Commissioner Apfel, 
thanks for stopping by to visit with us. Let's continue to 
pursue the notion of performance improvements--as my colleague 
from Michigan pointed out, a 2-year period of time on an 
appeals process.
    As you talk about both long-term and short-term improvement 
of performance for Social Security participants, I want to 
explore one area that I guess will come up with other panels, 
too, but let me just ask you briefly how many employees of the 
Social Security Administration work full-time on union 
activities?
    Mr. Apfel. I will have to provide that number for the 
record. The Social Security Administration has a long history, 
as the Federal Government does, of union activities, of unions 
being involved in partnership activities and collective 
bargaining arrangements, and I will provide the specific 
number. I would point out, sir, that with the exception of last 
year when we were negotiating the new national agreement, our 
official hours, the amount of time spent by our collective 
bargaining activities and our official union time, has declined 
over the last several years.
    Mr. Hayworth. Well, I would be very happy to also see, if I 
could request if you could provide for me in writing, in a 
timely fashion--and I would hope by this time next week would 
not be too excessive to ask for this--I would like to know the 
number of employees for the Social Security Administration who 
work full-time on union activities, the number of employees who 
work part-time on union activities.
    [The information of follows:]

    In fiscal year 1999, 134 individuals worked full time on 
union activities, which equates to 0.268 percent of the 
represented workforce.
    Also in fiscal year 1999, 1,605 individuals used official 
time for union activities on a part-time basis. To put the 
number of part-time representatives in perspective, it should 
be noted that SSA is a complex organization in terms of its 
service delivery structure. There are over 1,300 field offices, 
140 hearing offices, 7 large processing centers, 37 teleservice 
centers, 10 regional offices and a large number of components 
in headquarters. Designating union representatives in many of 
these sites or within individual work units helps promote the 
resolution of issues at the lowest possible organizational 
level. Many of these 1,605 individuals spend a very limited 
amount of time on union activities.

    Mr. Hayworth. And as you point out a longstanding 
tradition, I must also point out, in fairness to you, sir--and 
perhaps some of the same folks join us today--last Congress 
when we held a hearing of this type, I was saddened and very 
disappointed to learn that some employees with certain job 
titles had not worked a case in a period of years, some in 
excess of an entire decade.
    So with that going on, how do you think that affects worker 
activity and dealing with the backlog of cases and the growing 
number of recipients?
    Mr. Apfel. Mr. Hayworth, I believe that labor activities at 
the Federal level are a central, important activity that all 
organizations are involved with. And also--
    Mr. Hayworth. Do they supersede job descriptions and 
delivering services to the American people, Commissioner?
    Mr. Apfel. Mr. Hayworth, if there is an individual who is 
one hundred-percent on union official time, then that 
individual is not involved in case work. That is very 
consistent with the way it is throughout all of the Federal 
Government and it is--
    Mr. Hayworth. Well, then maybe you can clear this up for 
me. Do they have job titles that would imply they deal with 
case work?
    Mr. Apfel. They are in certain GS grade levels, yes.
    Mr. Hayworth. Well, then perhaps we ought to have truth in 
labeling when it comes to job descriptions. Perhaps we should 
designate folks as full-time, taxpayer-funded shop stewards who 
are not there to serve the taxpayers, but instead to deal with 
the collective bargaining process. Would that be a helpful 
measure to take?
    Mr. Apfel. Mr. Hayworth, I believe--
    Mr. Hayworth. Well, you are saying that apparently the 
primacy of the union relationship and collective bargaining is 
sacrosanct and, in fact, supersedes the job that these people 
have to deliver to the recipients of the Social Security 
Administration. And I have got to tell you this morning I find 
that shocking, but if that, in fact, is the philosophy, 
Commissioner, then let's bring it out in the open and let's 
have truth in labeling and let's label these folks shop 
stewards who are paid by the taxpayer to do nothing but engage 
in union activities.
    Mr. Apfel. Well, I can point out also, sir, that engaging 
in union activities has helped us significantly improve 
customer service.
    Mr. Hayworth. Well, I would like to see that quantified.
    Mr. Apfel. And I will--
    Mr. Hayworth. And in one week's time, I would like to see 
the figures that you can send. Even when we get stuff from the 
shop stewards telling us how we had better take all their 
benefits off budget, probably using taxpayer dollars to send us 
this propaganda, I would you to quantify for me the benefits of 
all this union activity on Government time, and explain to us 
all how that is being good stewards of the taxpayers' dollars.
    In fact, Mr. Commissioner, when I get four calls to my 
office from Social Security beneficiaries who say, can you help 
us, the SSA has declared us dead, I would you to reconcile how 
a lively union movement helps folks who are declared death when 
they are very much alive and kicking, and we have to intervene 
to try and get their benefits back. Maybe, I guess, we can 
establish a lifeline hotline or something to help these folks.
    When you come here on one hand and talk about productivity 
and falling behind and the baby boomers, and on the other hand 
you blissfully disregard the notion of full-time employees with 
titles where they are supposed to be helping the American 
people, when they are, in fact, shop stewards, maybe we ought 
to just have truth in labeling.
    I thank you for your time.
    Chairman Shaw. The time of the gentleman has expired.
    Mr. Apfel. I would like to--
    Chairman Shaw. If the Commissioner wants to reply, I would 
certainly allow him to do so.
    Mr. Apfel. I would, Mr. Chairman. I would like to also 
include in the record our partnership evaluation which shows 
the hundreds of activities that our partnership activities with 
labor have helped improve customer service through the Social 
Security Administration.
    [The ``Evaluation and Partnership'' report is being 
retained in the Committee files.]
    I would also like to point out that the Labor Management 
Relation Act has protected union representation in the public 
sector through Richard Nixon, Ronald Reagan, Gerald Ford, 
throughout the entire last three decades. I think these are 
important activities that are conducted, and they help us 
provide service to the American public. I will provide that for 
the record, sir.
    Mr. Hayworth. Great.
    [The information follows:]

    I would also like to provide some additional background 
information on labor-management relations in the Federal 
sector. In 1962, President John F. Kennedy issued an Executive 
Order that established a framework for Federal agencies to 
bargain with unions over working conditions and personnel 
practices. This Executive Order, along with a series of 
subsequent Executive Orders, was codified in the Civil Service 
Reform Act of 1978, which established official time as an 
integral part of Federal labor-management relations and the 
Federal sector collective bargaining process.
    During the Reagan Administration, the first consolidated 
collective bargaining agreement between the Social Security 
Administration (SSA) and the American Federation of Government 
Employees, which recognized Agency payment of official time 
from both the trust funds and general revenues, was signed by 
then Commissioner of Social Security John A. Svahn on June 11, 
1982. Official time granted to union representatives to engage 
in activities on behalf of the union is deemed to be Agency 
work. However, official time may not be used for internal union 
business. SSA, like other Federal agencies and many firms in 
the private sector, pays for approved time spent by its 
employees on official time.
    Partnership has helped us reduce the high costs associated 
with protracted litigation of grievances. For example, we have 
seen a reduction in litigation, specifically unfair labor 
practice charges from 467 in FY 1990 to 209 charges in FY 1995. 
The General Accounting Office previously estimated the cost to 
the Federal Government to fully process one unfair labor 
practice as in excess of $28,000, so that the reduction 
represents a potential savings of over $7 million per year. 
This trend in reduced unfair labor practices has continued. 
There were 167 such charges filed in 1999, significantly less 
than the 467 in 1990.

    Chairman Shaw. Mr. Cardin?
    Mr. Cardin. Thank you, Mr. Chairman. Mr. Chairman, let me 
also point in response to my friend's comments that Government 
workers, SSA workers, do not enjoy the same labor rights as 
private sector employment. And the type of progress that we 
have been able to make at SSA over the last several decades 
with significant reduction in the number of employees and a 
significant increase in the amount of workload, we have been 
able to make that progress because of the cooperative spirit 
between labor and management.
    So I think it is clearly in the taxpayers' interests that 
we protect the rights of workers at SSA, and part of that is 
workers being able to have their representatives able to work 
with management in a cooperative way. It has worked very well 
at SSA and I am very pleased that we are able to provide that 
type of support to our employees.
    Mr. Chairman, let me also point out--first, Mr. Apfel, let 
me congratulate you, as Mr. Levin indicated, on the high grades 
that you have received on the Government performance projects 
report card, receiving an A last year. We are very proud of 
that.
    As you know, I represent Baltimore, and I get to SSA 
probably more than any of the other members of the subcommittee 
and have a chance to talk to the employees and management on a 
rather frequent basis. And I must tell you I am concerned. I am 
concerned by the increased workload and the reduction in the 
workforce.
    In this budget, fiscal year 2000 budget, you are receiving 
hundreds of millions of dollars less than you requested that 
you thought was necessary in order to be able to continue to 
make the progress on the types of services that our 
constituents expect. They expect when they call the 800 number 
it is going to answer. You get over 1 million inquiries by 
phone a week at SSA. That is a large volume increase, and it is 
increasing at all times. The number of SSA beneficiaries is 
increasing. And we put new responsibilities by passing 
legislation here that creates new work on SSA.
    So, Chairman Shaw, I agree with your point, and that is 
this committee, on a bipartisan basis, has supported the type 
of administrative support that you need. Unfortunately, that 
hasn't been carried out by the appropriators. Consistently, the 
appropriators have appropriated less than I think what we 
believe is necessary for you to make the type of progress on 
carrying out the responsibilities of the agency.
    I must tell you, Mr. Chairman, I think we need to be more 
aggressive. I know next week we are going to be considering a 
supplemental appropriations bill. I am disappointed that there 
isn't at least a discussion about SSA receiving some of that 
money because I don't think you have enough money in this 
year's budget to carry out the type of progress that we would 
like to see at SSA.
    And I guess what concerns me, our district offices are 
going to start to receive more complaints. We are going to 
start to hear from our constituents who are going to be upset 
with not being able to get the type of information that they 
expect on the progress that has been made to get their 
disability determinations heard, to get all the information 
that comes through on a regular basis to our office when it is 
not done on time. And we are going to start expecting more and 
more of you when, in reality, it is our fault, Congress' fault, 
not the agency's fault, because we are not providing the 
resources necessary for you to be able to do the job.
    So I guess my question to you is I really would like to 
have your observation. You seem to be very diplomatic in the 
way that you approach this hearing, but I would really like to 
have your assessment of the current year's budget as to whether 
we are going to be able to continue to make progress in the 
type of consumer activities that my constituents depend upon in 
your agency, whether it is disability determinations or whether 
it is just getting information over the 1-800 number, without 
providing more support.
    The number of your employees has actually been reduced at a 
greater level than the overall Government level, and you are 
one of the agencies that has grown dramatically in your 
caseload. We all know that. We know the problems of Social 
Security, the demographic changes of our country. So I would 
appreciate your observations as to your budget.
    Mr. Apfel. Thank you, Mr. Cardin. I would point out that 
the Appropriations Committee has tried hard also to support the 
Social Security Administration, but it also faces large budget 
caps which make it very hard to fund all of the activities that 
the Committee would like. And I know that we have some good-
faith discussions over in Appropriations as well, but caps have 
led to reductions.
    As you are aware, Mr. Cardin, I personally have supported 
scoring Social Security administrative costs outside of the 
budget caps, and I still believe that is the right thing to do. 
But if we look toward 2001, my budget request calls for over an 
8-percent increase. It is a sizable increase. The President's 
budget calls for a 5-percent increase, so those are sizable 
amounts of resources.
    I believe we are going to need that in the short term to be 
able to continue to provide quality service to the American 
public. What we have got to be able to do is ensure resources 
and change. The Social Security program has changed in the 
course of its 65-year history to meet new needs. I believe we 
need to change, too.
    We need to deal with new technologies. We need to be able 
to touch the American people in the way they want to be touched 
through our 800 number or through our field office structure, 
through changing technologies. It is clear to me that unless 
resources are adequate in the year 2001, it will be very hard 
to improve service through our 800 number, to use an example, 
and the stresses that are felt now in field offices will grow.
    I have a workforce--and I said this in my written 
testimony--my greatest pride as Commissioner of Social Security 
is the commitment of Social Security employees to providing 
service to the American public. They try very, very hard, and I 
would just urge everyone to go to their field offices and just 
say, how hard are you working out there? I think you are going 
to hear a tremendous commitment to providing service to the 
American public, and the workloads are very, very major.
    With adequate resources--and in my case that would be 
restoring some staffing levels in our field structure and 800 
number structure--we can provide better service. But ultimately 
it is not only about money; it is also about change. We have 
got to be able to plan for the future and take the steps that 
are necessary to meet those changing needs of the American 
public. So it is resources, and it is also change, and I 
believe I start off with a base that provides me with an 
enormous amount of pride. Our workforce goes the extra mile 
each and every day, and we will continue--at whatever level of 
resources we receive--we will continue to do whatever we can 
for the American public.
    Mr. Cardin. Thank you, Mr. Chairman.
    Chairman Shaw. Mr. McCrery?
    Mr. McCrery. Thank you, Mr. Chairman.
    Mr. Apfel, do you know how many total employees are in the 
Social Security Administration?
    Mr. Apfel. Counting the State disability determination 
system, about 80,000.
    Mr. McCrery. Eighty thousand?
    Mr. Apfel. That is counting the States. Without the States, 
about 65,000.
    Mr. McCrery. And do you know how that compares to the total 
workforce, say, 5 years ago?
    Mr. Apfel. Five years ago?
    Mr. McCrery. Four years ago, ten years ago.
    Mr. Apfel. I would say over the course of the last 5 years, 
the workforce has come down in the last 5, 6 years, about 2 or 
3 percent. We have been largely exempted from the major 
downsizing that has taken place throughout the Federal 
establishment through the last 5 and 6 years because of our 
service responsibilities. There have been some reductions.
    Our sizable reductions took place really back in the 1980s, 
and they were major. Over the last few years, we have been 
largely exempted from that, and I will provide a statement for 
the record that shows both our workforce in, say, 1993 and 
where it is now. And my written testimony points out what other 
Federal agencies went through in terms of downsizing and what 
ours is, and I will provide that for the record, sir.
    Mr. McCrery. But you think it is about a 2-or 3-percent 
reduction?
    Mr. Apfel. Over the course of the last 6 or so years, that 
is about correct.
    Mr. McCrery. Okay. I have visited the field offices of 
Social Security, and I agree that people there work hard and 
they have got a lot to do. So I don't mean to imply by my 
questioning that your workforce is not doing a good job and 
trying very hard to serve the public. I think they are.
    However, we have seen, as Mr. Johnson alluded to in his 
questioning, tremendous strides by the private sector in 
becoming more productive and more efficient, due to technology 
primarily, and they have been able to downsize their workforces 
by more than 2 or 3 percent. Major corporations have really 
downsized, starting back in the 1980s and continuing through 
the 1990s.
    And I don't know that we can duplicate that in the public 
sector, but I think we ought to, as Mr. Johnson suggested, make 
every effort, and maybe you are. And it sounds like the 
conference that you plan this summer may be getting toward 
that, but I just think every agency of Government, including 
the Social Security Administration, ought to make every effort 
to discover ways to do more with less, just as the private 
sector has done, in order to remain competitive in the world 
marketplace.
    They were forced to do it by market pressures, especially 
back in the 1980s, but even in the 1990s. And Government has 
not been forced to do that. Thankfully, we have done it to some 
extent, but maybe we can do it some more. And I will just ask 
you--and I think you are sincere, I think you are a good public 
servant--I would ask you to make every effort in your 
conference this summer and in every other way you can do it as 
long as you are the Commissioner to try to discover ways to do 
more with less.
    I kind of think we can find ways to do that in the 
Government sector, but it is going to take good people like 
you, dedicated not only to providing good public service, which 
we all want to do, and our constituents demand that they 
deserve it, but also people who are dedicated to protecting the 
taxpayer as well.
    So thank you for coming today, and I will look forward to 
your coming back maybe later this year after your conference 
and letting us know what you have learned from that.
    Mr. Apfel. Thank you, Mr. McCrery. If I could give you the 
statistics that you had asked for, it is in my written 
testimony.
    Mr. McCrery. Sure.
    Mr. Apfel. The Social Security Administration, since 1985, 
has had a 22-percent reduction in staffing, in total. Since 
1993, it is 4.6 percent. Counting our State disability system 
the comparable numbers are 17% and 2.0 percent respectively. 
Total Federal civilian employment declined during that period 
of time by 17 percent, and non-defense civilian employment by 9 
percent. So, clearly, there has been less.
    Mr. McCrery. Yes.
    Mr. Apfel. Doing more with less has been part of Social 
Security's activities for many, many years, and I agree we need 
to find every way possible and automation does hold a key to 
being able to do more with less. When we look at our workloads 
in the future, the purpose of this hearing, we are going to 
have more.
    Mr. McCrery. Yes, and I am not suggesting--I think we are 
going to have a problem and I am not suggesting that you are 
going to be able to do everything, the increased workload, with 
your current workforce or even a reduced workforce. I am not 
suggesting that, but in view of the facts that we know are out 
there, we all better do everything we can.
    And there are going to be pressures on the budget even 
though we have got a surplus. As you know, we have got a 
tremendous demand for Social Security benefits, for Medicare 
benefits, Medicaid benefits, that we are going to have to 
satisfy eventually. So there is going to be pressure on the 
budget, and so we better do all we can to meet this crushing 
need with as few workers, employees, in the public sector as we 
can.
    Mr. Apfel. I agree that has to be a continued priority for 
the agency, sir.
    Mr. Shaw, you asked about the notices and whether they were 
finalized and up and running.
    Chairman Shaw. Yes, sir.
    Mr. Apfel. They are already finalized and up and running in 
our field offices and our 800 number almost totally, so that we 
are almost entirely done with that project, and it does help. 
That is the kind of the situation where automation--the perfect 
case--automation can help an individual worker do their job, 
and do more with less. It is the kind of activity we need to 
continue to work on.
    Chairman Shaw. Commissioner, if you get down to Florida any 
time soon, one of the 800 number facilities is right there in 
Fort Lauderdale and I would like to visit it with you and we 
can go in and take a close look at what is going on and bring 
stuff up on the screen.
    Mr. Apfel. That would be great. Mr. Shaw, I would point out 
that we have a number of 800 number sites around the country; 
we have large ones and we have a number of smaller ones. And 
one of the questions was shouldn't we eliminate those smaller 
centers for efficiency purposes. If I were here 5 years ago, I 
would probably have said not a bad idea.
    But technology changes and the ability to route calls, the 
changes that have taken place in technology, lead me to now 
conclude that those smaller centers are every bit as efficient 
as the larger ones. With technology, again, we are able to 
route those calls so much faster so that small office in 
Florida, and there are many around the country, can provide a 
very good service. And I think they should continue.
    So where I would have maybe come down on the other side 5 
years ago, I wouldn't have realized what technology would have 
done for us, and so that center makes sense to be there and to 
thrive and to prosper.
    Chairman Shaw. Thank you.
    Mr. Doggett?
    Mr. Doggett. Thank you, Mr. Chairman.
    Commissioner, do I understand that it is the best estimate 
of your office that if the House Republican Budget Committee 
resolution that they recommended yesterday is fully implemented 
by this Congress that you will have an opportunity to do less 
with less, and that, in fact, one-half of the people who file 
for disability in this country will not have their claims 
processed during fiscal year 2001?
    Mr. Apfel. If the budget assumptions translated into a 
reduction of somewhere between $1.2 and $1.4 billion, it would 
be less with less, and it would mean significantly longer 
waiting times for disability, an 800 number that would be busy 
for large parts of the time. It would mean a significant 
deterioration of services, sir.
    Mr. Doggett. And is that your best judgment at this point, 
as you understand the resolution, of its effect?
    Mr. Apfel. Well, ultimately it will be up to the Congress 
and the Appropriations Committee to decide how to handle that. 
But as I understand the resolution, if it translated into an 
across-the-board for these programs, our share of that would 
mean the numbers that you have just laid out in terms of 
service deterioration.
    Mr. Doggett. Half of the people who file for disability 
would probably not get their claims processed during the next 
year?
    Mr. Apfel. That is correct.
    Mr. Doggett. As you know, my office in Austin, and I expect 
the offices of everyone up here, does a good bit of work for 
Social Security disability claimants. We have inquiries about 
that, other aspects of your administration, and that is one of 
the reasons that I was so troubled by the proposal that was 
advanced last year to impose the tax on claimant 
representatives.
    I have corresponded with you about that since then. I know 
you supported the action of the Congress in that regard, but in 
your correspondence I think you make it clear that while you 
supported it, contrary to my view and the view of a number of 
the disability advocate groups, the idea of a tax or user fee 
on claimant representatives, that you supported it with the 
understanding that money would be utilized to improve service 
and perhaps to reduce the time lag on the payment to claimant 
representatives.
    And I gather that did not happen; that contrary to your 
recommendation, those monies were never deposited into the 
account necessary to allow you to improve the administration of 
the payment process.
    Mr. Apfel. Mr. Doggett, that is correct.
    Mr. Doggett. So we have the new tax, but we do not have 
through it any funding for improvements in the payment process?
    Mr. Apfel. That is correct. Our recommendation had been 
that the receipts from this user fee be used to pay for 
administrative costs to allow us to make further improvements 
in the service.
    I must point out, sir, that we have reallocated internally 
to do this extra work. We have allocated this year over 100 
work-years from other ongoing activities to handle this backlog 
of cases, and we are now about 80 percent through. So we are 
doing the work, but the reality is it means we are doing less 
somewhere else within the agency.
    Mr. Doggett. You don't feel that you have the resources 
necessary to address the full improvement of the administration 
of the process on handling the payments to claimant 
representatives that you would like to have?
    Mr. Apfel. If the law were as proposed and I did receive 
that added money, it would lead to better service, yes, sir. 
But we have allocated over 100 work-years to do this even 
though we did not receive the administrative resources for it. 
So if the law were changed and the resource came in, I could 
provide better service.
    But I would point out, sir, we have gone a long way toward 
strengthening the system. The law specifically took a 30-day 
period out of the processing, and our workload changes have 
also led to improvements. But they came at a cost, and that 
cost is other activities within the agency that we are not able 
to do.
    Mr. Doggett. What is the average lag time now? I know these 
cases sometimes take a very long period of time. But after the 
case is resolved, what is the normal lag time?
    Mr. Apfel. Well, our goal is about 60 days, and we have 
seen the 30-day improvement immediately, but we are also seeing 
improvements. There were some cases that had been backlogged 
that clearly had longer time lines, and about 80 percent of 
that has been worked through. So our goal is to get it down to 
much shorter times.
    Mr. Doggett. Is there any kind of average or median time 
for how long the resolution of a disability case takes?
    Mr. Apfel. The disability case itself?
    Mr. Doggett. Yes, because that is after the disability case 
is concluded.
    Mr. Apfel. Right. Oh, you mean how long it takes after the 
disability case is concluded. After the completion of the case, 
our goal is 60 days, and in many cases we can do it within that 
period of time.
    Mr. Doggett. Yes, I understood that was afterwards. What I 
am asking is what is the average or median time for the 
resolution of the disability case itself.
    Mr. Apfel. At the hearings level, which these cases are 
almost all hearing cases, it is a little bit under a year that 
these are taking to go through the process. By 2002, we will be 
down in the 200-day range, with further improvements in the 
future. So one of the most important things we can do is to 
drive that time down and have there be a shorter period of time 
from the appeal to the final resolution of that case, for lots 
of reasons, just pure customer service for one.
    Two, these individuals' conditions change over time. That 
means that more information comes in later. The case is not the 
same case that was originally heard at the State level. Driving 
down that time provides not only better customer service, but 
also will reduce the amount of work on that case because there 
will be less new information coming in on that case.
    Mr. Doggett. Thank you very much.
    Chairman Shaw. Mr. Weller?
    Mr. Weller. Thank you, Mr. Chairman.
    Commissioner, good morning.
    Mr. Apfel. Good morning.
    Mr. Weller. Good to see you again, and I appreciate you 
being before the subcommittee.
    You know, retirement savings and strengthening Social 
Security has been one of the top priorities of this Congress 
over the 6 years that I have been here, and I am pretty proud 
of the fundamental changes that we have made, along with 
balancing the budget and paying down $350 billion in the 
national debt.
    Last year, we succeeded in our effort to lock away 100 
percent of the Social Security Trust Fund for the first time in 
almost 40 years, and I appreciate the President going along 
with that and that was, I believe, fundamental change and 
fundamental progress.
    One of the questions I am often asked--and I represent the 
south side of Chicago and the south suburbs and a lot of rural 
areas, so you always listen for what is in common, whether you 
are in the city, suburbs, or country. The question I am often 
asked, as we look at the impact of Social Security and 
retirement savings for the future, is folks, you know, watch 
the numbers and the nightly news about what is happening in the 
Nasdaq and what is happening in the Dow, and they often ask me, 
you know, what kind of return are we getting on our Social 
Security? You know, the Government takes 12.6 percent of our 
income and, you know, what kind of return are we getting on 
that, because for many millions of Americans that is our 
return.
    Factoring in inflation, what is the current return on our 
Social Security investment?
    Mr. Apfel. Well, Mr. Weller, for about 85 percent it is 
zero because they are paying our parents. That money is not 
sitting in a bank account someplace. It is an intergenerational 
program, so the vast majority of payroll tax revenues for our 
workers pays our parents today. So there is, of course, a zero 
return on that. There is a very large return for our parents 
because they have economic security that comes from it.
    So the answer for about 85 percent of the resource is that 
there isn't a rate of return because it is an intergenerational 
program. It is one of the reasons it is very hard to compare 
rates of returns in a pure private pension advance-funded 
system with an intergenerational system because we are paying 
through our payroll taxes the benefits of those--
    Mr. Weller. On the remaining 15 percent, what is the rate 
of return?
    Mr. Apfel. On the 15 percent that remains, it is the 
average marketable securities, which is about 6, 7 percent, 
somewhere in that range.
    Mr. Weller. Does that include the rate of inflation or do 
you subtract the--
    Mr. Apfel. That includes the rate of inflation. It is a 
very low rate of return.
    Mr. Weller. So you are getting about 3 percent after you 
have 3-percent inflation?
    Mr. Apfel. Bonds are, I think it is fair to say, the safest 
investment throughout the world, but they pay relatively lower 
rates of return historically than corporate securities.
    Mr. Weller. How is that 15 percent that you do set aside 
and invest of someone's 12.6 percent of their income, that 15 
percent--how do you invest those dollars? How are they invested 
for the long term?
    Mr. Apfel. Well, thankfully, the Social Security 
Administration doesn't do any investing. That is all handled by 
the Treasury Department.
    Mr. Weller. How does the Treasury Department invest them 
for you?
    Mr. Apfel. The receipts that come in to the Social Security 
trust fund and the excess over what goes out is credited to the 
Social Security trust fund and all that extra amount increases 
at the average of Government securities or about 6 or 7 
percent.
    The important action that was taken by the Congress over 
the course of the last year or two, and I strongly support it, 
is that this does lead to national savings. For years, we were 
running large Federal budget deficits and Social Security was 
running Federal budget surpluses. The Social Security trust 
fund was receiving the same credits that it always did and its 
trust funds were credited with that and the interest would go 
forward.
    But the issue was how would we be able to redeem those 
bonds if we were running large deficits in the long term. 
Reserving the Social Security surplus and starting to think 
about what our non-Social Security surpluses are and how that 
is used and reserving those surpluses right now does put us in 
a stronger position for national savings. Whether or not we run 
Federal budget deficits will have no effect on the Social 
Security trust fund, but it puts our economy and our Nation in 
a stronger position to be able to redeem those bonds in the 
future.
    Mr. Weller. About once a year, I get in the mail at home my 
statement telling me that if my income stays the same and 
current projections, when I become eligible this will be what I 
will receive as a monthly benefit when it is my turn.
    Do you indicate, or have any plans to indicate on that form 
what the rate of return on that Social Security investment is 
for a taxpayer who is paying 12.6 percent of their income into 
Social Security?
    Mr. Apfel. Well, I believe the General Accounting Office 
agrees that using rate of return information on the Social 
Security statement would be quite misleading and confusing, 
given what we have just talked about, about the fact that 
mostly this is an intergenerational program.
    Our Social Security Statement does indicate information 
about the fact that 30 years out, revenues coming into Social 
Security will only pay about 71 percent of future benefits. We 
try to use the statement to educate the American people about 
the long-term challenges that we face. But the rate of return 
information, I think, would be misleading and I have no plans 
to add that to the statement.
    Mr. Weller. Mr. Chairman, could I ask one more question? I 
realize the red light is on, but--
    Chairman Shaw. One more question.
    Mr. Weller. All right. Just to follow up on that, do you 
feel that is information that would be helpful, though, to a 
taxpayer? Obviously, it is a projection. You know, you put 
money into a mutual fund and they project, at the current rate 
of return, this is what you would expect, if you continue your 
contributions, in 20 years.
    Do you feel that would be useful information for a taxpayer 
to have? Like I said, 12.6 percent of someone's income. That is 
a lot of money over a lifetime, and folks like to know what 
kind of return they are going to get on that investment. Do you 
feel that is useful information and that is something that a 
taxpayer has a right to know, at least a projection on what the 
rate of return would be and what the ultimate return on their 
investment would be of 12.6 percent of their income?
    Mr. Apfel. Again, Mr. Weller, you are adding in the fact 
that there isn't a rate of return for most of the program 
because this money is used in an intergenerational way to pay 
for our parents, as it has been since the creation of the 
program.
    The General Accounting Office, when we were trying to 
determine how to restructure the Social Security Statement, 
urged us to simplify it as much as possible. We had focus 
groups all around the country to provide information that we 
thought would be helpful, and I must say I have heard 
tremendously positive reports on our Social Security Statement, 
and specifically on our statements about the fact that we do 
face long-term challenges and there is a significant shortfall 
in the long run.
    We also indicate that people should get our brochures on 
the future of Social Security. I don't think it makes sense for 
that information to be included, for complexity reasons, but 
also for the fact that it is not a fair comparison because this 
is primarily an intergenerational program.
    Mr. Weller. All right. I see my time has expired, Mr. 
Chairman. Thank you.
    Chairman Shaw. Yes, sir.
    Mr. Collins?
    Mr. Collins. Thank you, Mr. Chairman.
    Commissioner.
    Mr. Apfel. Mr. Collins.
    Mr. Collins. You know, I was listening to your comments and 
answers to previous questions concerning resources versus 
production, and I was pleased to hear that you have made 
adjustments within the agency to take care of some of the 
problems of those who are recipients of our services through 
the Social Security Administration. So I commend you for that. 
That is good leadership.
    I also want to take the opportunity to tell you thanks for 
the assistance that you rendered in my district here a couple 
of weeks ago when we had several hundred checks that were lost 
in the mail. And your assistance was very, very helpful, and it 
was very timely and folks in my area appreciate that.
    Mr. Apfel. I will pass that back to our Social Security 
folks who worked very hard to resolve that problem, sir.
    Mr. Collins. And they did a good job, they sure did, an 
excellent job.
    Mr. Apfel. Thank you.
    Mr. Collins. You know, I go back to leadership, and you are 
making the necessary adjustments within the agency to take care 
of the problems that arise. You were setting priorities is what 
you were doing there, and we are going through a time right now 
that families are having to make a lot of adjustments, too, 
because of different increases in cost in the marketplace, 
particularly in the area of petroleum products. So it is 
something that we have to get accustomed to ourselves here in 
the Congress, but the Congress doesn't seem to have the ability 
to make those adjustments as fast as what you have done in your 
agency and as fast as what the public is having to do in their 
family budgets, as evidenced by the budget that the Budget 
Committee passed out last night, which I think was excessive in 
spending. And that excessive spending is what creates excessive 
taxation, and we have a little bit of both there, and quite a 
bit of both.
    When you were here earlier, I asked you the question about 
the workforce plan. I see that you have submitted that 
workforce plan, dated February 29. This seems to be a good 
preliminary, if I read it right, that you are following up with 
this with a continuous Vision 2010 that will give more 
substance to exactly how you are going to meet the challenges 
of the retirement wave that is going to hit you between the 
years 2007 and 2009, where you are going to have about 3,000 
retiring per year, on an average today of about 851. And you 
are going to lose quite a bit of your supervisory personnel, 
which is going to be quite a challenge to you.
    So I take it this is kind of a first--not a first step, but 
one of the steps that you will be engaged in and planning for 
the future to beat the baby boom generation as they come on 
board. Is that not true?
    Mr. Apfel. Mr. Collins, it is a first step. It is only a 
first step. I think it is a very important document to lay out 
the challenges that we face within our workforce. What we need 
to be able to do, after we develop our long-term vision of how 
we are going to provide this service, is to reorient our 
workforce plans to make sure that we are training the right 
number of people, that our entries of new people coming in can 
deal with these long-term challenges.
    So I believe that it was a very important first step, and I 
am pleased that you appreciated the work. It will provide a 
guidepost, but it is only one of the things that we need in the 
workforce area. If I could indicate, I think there are three, 
actually.
    One is a stronger workforce transition plan based upon a 
long-term vision which we need to be able to produce consistent 
with the piece that you received.
    Two, we need a stronger workload measurement system within 
Social Security. You will probably be hearing later today, or 
if you ask, whether our workload measurement system does a 
really good job of capturing the work that people do. And I 
think that the answer is it doesn't do a good enough job. We 
are going to need to develop a better system to be able to find 
what people are doing and capture it within our system, so that 
we can assure you provide stronger budget justifications and 
with more solid information to our managers and our labor 
force, to be able to understand what those workloads are. So 
that is the second thing.
    And then, three, I think we need to be able to do a better 
job of linking resources, with workforce, with outputs. I think 
we try very hard and I think we are one of the leaders in 
Government in this area, but we need to do more again to better 
determine that this much resource will lead to this 
configuration of workforce, will lead to that output for the 
American public--that is completing so many calls on the 800 
number system or decreasing disability claim processing times 
by so many months.
    And if it is more money, then we can see better service. If 
it is less money, then we will see a lower quality service and 
lower work. Ultimately, that is my goal, to be able to provide 
you and the agency with that information, because I think that 
will help us plan for the future.
    Mr. Collins. Well, I think that is good strategy. You must 
have a plan in order to have the proper resources appropriated, 
and so I am pleased to hear that. And we look forward to the 
next step, and I have confidence that you as Commissioner will 
see that is carried out in the proper fashion. Thanks again for 
your assistance.
    Mr. Apfel. Mr. Collins, thank you, and we consider this to 
be a very high priority for the agency.
    Chairman Shaw. Mr. Commissioner, a later witness will be 
describing how the SSA is poised to launch a project offering 
online application for the benefits, and that is just starting 
in April of this year. I don't see any mention of that in your 
testimony. Can you elaborate on that to us and tell us what 
security and privacy precautions you anticipate will be in 
place?
    Mr. Apfel. Mr. Chairman, if you are concerned that we are 
reopening the online PEBES discussions of prior years where we 
provided information over the Internet to be able to have a 
person's earnings history be done, that is not being discussed 
at all right now. I believe that we haven't yet created the 
right balance between--
    Chairman Shaw. We are talking about claims-taking now, 
applications for claims-taking.
    Mr. Apfel. Oh, I am sorry, the claims-taking. We are 
working, Mr. Chairman, on ways to start using the Internet to 
provide some online retirement applications. We have not 
finalized those plans yet. Before we do, I will be talking to 
this committee about them. I think it is very important that we 
discuss these matters with you. I am not quite ready to discuss 
them yet because we have not finalized anything yet.
    Chairman Shaw. Well, then the information that I have that 
you are going to launch this in April has to be wrong. Is that 
correct?
    Mr. Apfel. That is wrong.
    Chairman Shaw. Okay.
    Mr. Apfel. That is wrong. We will be back to you. It is one 
of the areas where we want to make prudent use of existing 
technology. What we need to be able to do is find ways to take 
small--rather than creating large, mega computer changes that 
take billions of dollars, we need to create small, incremental 
improvements. The Internet may help us do that with small, 
incremental improvements.
    There is some work going on looking at some initial 
activities. I am not prepared yet to speak about those, in 
general. It is not starting in April for the online 
applications, but we will be back to you and I would 
specifically be briefing your committee about these activities 
before they roll out.
    Chairman Shaw. Let me ask you about one more area, and I am 
going to try to finish up before I have to go vote, too. And 
this goes back to previous discussions that we had and that 
Chairman George Gekas, of the Judiciary Committee, has been 
working on.
    They have submitted a list of very specific questions 
pertaining to the operation of the Office of the Chief 
Administrative Law Judge in the Office of Hearings and Appeals. 
And from this list, I would like to ask you two specific 
questions, and if you are brief enough in your answer, then you 
get out of here before I go vote. If you elaborate too much, 
then you are going to be stuck here until I get back.
    First, in a hearing last October and in writing, you 
informed me that there were no plans for a reorganization of 
the headquarters of the Office of Hearings and Appeals. Yet, we 
continue to hear about staff changes which many would argue 
have undermined the authority of the powers of the Chief 
Administrative Law Judge.
    Is your prior statement no longer true? Has that changed 
since you were before this committee?
    Mr. Apfel. No, sir. There are no plans or intentions to 
reorganize the office. I don't want to undermine the Chief 
Administrative Law Judge.
    Chairman Shaw. Okay.
    Mr. Apfel. We have had a briefing with your subcommittee to 
discuss some of the activities that are underway. The hearing 
process improvement activities have led to a series of work 
groups that have been established and some temporary 
arrangements. We have provided some information to the 
subcommittee. The subcommittee asked for a series of detailed 
information that we committed to provide by next week, and we 
will.
    But I have no plans to reorganize. I think we need an 
independent Chief Administrative Law Judge, and I have no plans 
for reorganizing. But we will provide this information for this 
committee, and also for the Judiciary Committee, so that we can 
get to the bottom of this matter.
    Chairman Shaw. Second, have you considered the requirements 
and the intent of the Administrative Procedures Act to separate 
the daily operations of SSA from the adjudication division of 
SSA and any potential reorganization of SSA?
    Mr. Apfel. Well, I haven't considered a reorganization of 
the administrative law judge function. If one were going to 
think about such an issue, one would be certain to look at the 
Administrative Procedures Act as part of the important issues 
to be confronted.
    We clearly need an independent judgment by administrative 
law judges. I don't think we should have a situation where we 
are pressuring anybody to make individual decisions. The 
Administrative Procedures Act ought to be an important part of 
that. But, again, I have no plans to do that. We will be 
providing more information to the committee next week, and also 
to the Judiciary Committee on this matter, and let's move 
forward from there, sir.
    Chairman Shaw. All right. Commissioner, I note that 
Chairman Gekas does pose several additional questions, and I 
will ask you to respond to this subcommittee and to Mr. Gekas 
in writing, as I am sure you will, with answers to these 
questions which we will include as part of the formal record of 
this hearing. We continue to hear these rumblings coming out of 
Mobile, Alabama, and those are of concern to this committee.
    [The information follows:]

Responses to Representative Gekas' Letter of March 15, 2000

    a) Is it true that the Regional Chief Judges are reporting 
to the OHA Associate Commissioner and to the Deputy 
Commissioner for operations instead of the Chief ALJ?

     Under the past and current functional 
organization, Regional Chief Judges have a direct reporting 
relationship with the Chief ALJ for all issues related to the 
hearings process and its day-to-day operation. They receive 
direction, and are expected to coordinate their activities, 
with numerous other management officials within the Agency.
    The Regional Chief Judges are temporarily also serving as 
the Hearing Process Improvement (HPI) Process Action Team to 
implement pre-hearing changes, and they are coordinating their 
activities through Regional Chief ALJ Stephen Wright. Judge 
Wright is temporarily reporting to a deputy commissioner for 
those activities related to this time-limited project 
(projected to end March 2001). All of the Regional Chiefs, 
however, continue to report to the Chief ALJ on matters 
unrelated to HPI.
    b) Is it true that the Chief ALJ's authority to coordinate 
hearing services for the Mobile, Alabama OHA was removed to the 
Regional Chief ALJ in Atlanta, who is not reporting to the 
Chief ALJ under current operation structure?

     There has been no change in authorities or 
reporting responsibilities in the Mobile, Alabama Hearing 
Office or any other hearing office. Under our current operating 
structure, the Mobile Hearing Office Chief Administrative Law 
Judge reports to the Regional Chief Administrative Law Judge in 
Atlanta who, in turn, reports to the Chief Administrative Law 
Judge.
    We are aware that the Chief ALJ has taken an active role in 
monitoring activities in the Mobile hearing office, resulting 
in improved management and performance. The Chief ALJ continues 
to provide management oversight for all administrative and 
managerial functions involved in the day-to-day operations of 
offices, and maintains a continuous review of all aspects of 
OHA field operations, implementing improvements where needed.

    c) Is it true that the positions of the Deputy Chief ALJ 
and the operations Director of the Chief ALJ's office are 
vacant and have remained so for over six months and there are 
no current efforts to recruit for the position? If there are 
plans to fill the vacant positions, please describe and detail 
the involvement of the Chief ALJ?

     It is true that the Deputy Chief ALJ and the Field 
Management Officer positions have been vacant since October 
1999. However, we plan to recruit for the positions week of 
April 3. In terms of his involvement, the Chief ALJ is the 
official who requests to recruit for a position; he recommends 
a selection to the Associate Commissioner and Deputy 
Commissioner for final approval.

    d) Is it true that the training function in the Office of 
the Chief ALJ has been removed to the Associate Commissioner's 
Office of Management under Mr. Pat Carey?

     It is not true that the training function or any 
function has been removed from the Office of the Chief ALJ 
(OCALJ). Providing training is not in the OCALJ functional 
statement. This function is assigned to the Office of 
Management under the direction of the Associate Commissioner. 
OCALJ traditionally identifies training needs and priorities, 
and is consulted on faculty and curriculum. However, the Chief 
ALJ has, and will continue to have, an important role in 
identifying training needs and in working with the Associate 
Commissioner to assure that these needs are met.

    e) Is it true that the Division of Field Practices and 
Procedures in the Chief ALJ's office is being reduced by half 
and transferred to the Office of Management?

     It is not true that the Division of Field 
Practices and Procedures in the Chief ALJ's office is being 
reduced or staff transferred. There have been discussions 
concerning placing some staff on temporary details to perform 
core functions in the Office of Management and the Office of 
Policy, Planning and Evaluation, but no decision has been made.

    f) Is it true that activities are underway to abolish the 
Division of Field Practices and Procedures and the Division of 
Field Operations and Liaison in the Chief ALJ's office and 
remove these functions to the Office of Management and the 
Associate Commissioners?

     It is not true that activities are underway to 
abolish either Division. It is true that we have had internal 
discussions to develop improved ways to deliver the core 
functions of DFPP and DFOL in support of the Regional and 
hearing offices. However, there are no plans to remove any 
functions from those units.

    g) Is it true that the Chief ALJ, at the request of the 
Office of Personnel Management, developed a plan to provide a 
temporary detail of SSA ALJs to the Department of Interior to 
reduce the case backlog of Indian Probate Claims? The basis of 
the ALJ loan request is essential to the orderly functions of 
the Administrative Procedure Act upon which it is premised.

     It is not true that the Chief ALJ developed a plan 
to provide a temporary detail of SSA ALJs to the Department of 
Interior. When SSA received a request for assistance through 
the Office of Personnel Management to provide assistance to the 
Department of Interior, the Chief Judge prepared an assessment 
of the impact of such a request on OHA's hearings operations.
    SSA is not considering any plan to transfer its hearing and 
appeals resources to another Department. Our current backlogs, 
especially in the appeals section, require all our available 
resources. Current law allows the Department of the Interior to 
use its own legal corps to adjudicate the Indian Probate 
Claims.

    h) Is it true that the Associate Commissioner has sent the 
request for a detail of temporary ALJs for the Department of 
Interior to your office for approval of the plan developed by 
SSA's Chief ALJ?

     There are no plans to detail any SSA ALJs to the 
Department of Interior. See discussion of backlogs above.

    i) Has the Commissioner's office considered the 
requirements and the intent of the Administrative Procedure Act 
to separate the daily operations of SSA from the adjudications 
division of SSA in any potential reorganization of SSA.

     SSA recognizes the importance of maintaining the 
independence of the ALJs, and would not take any action that 
would compromise decisional independence under the 
Administrative Procedures Act.
      

                                

    Chairman Shaw. One other thing that I would like to submit 
to you, and I will submit to you now and if you could come back 
in writing, I am concerned about the aging of the Social 
Security staff and the projections of retirement ages, 
particularly as that group goes out as the baby boomers are 
coming in. And I am very concerned about the fact are we 
arranging for early retirements or whatever it takes so that we 
will have a consistent, trained group of people to help out.
    So if you could just submit in writing, with numbers of 
employees, projections on retirement dates and related issues 
to this committee, that would be very, very helpful. I feel 
that is part of our oversight responsibility, and I know you 
are concerned about it.
    Mr. Apfel. It certainly is, Mr. Shaw. Could I give you 30 
seconds? Do you have the time for that or not?
    Chairman Shaw. Hurry.
    Mr. Apfel. Yes, sir. We will provide that in-depth for the 
record.
    [The information follows:]

    In response to Mr. Shaw's request for information about 
SSA's workforce, attached for inclusion in the record is the 
report ``Workforce Planning at the Social Security 
Administration.''

    [``The Workforce Planning at the Social Security 
Administration'' report is being retained in the Committee 
files.]

    Mr. Apfel. It is clear that we are going to need to flatten 
that retirement wave to be able to not have these peak 
activities happening in the outyears. And, clearly, providing 
training is one of the important activities.
    Lastly, one of the things I think we need to look at is 
whether we should be rehiring retired Federal annuitants to 
come back in to provide service. I think that would be a very 
interesting idea, potentially. It is not legal right now, so 
there are no laws that allow us to do that. But I would like to 
explore some activities with--
    Chairman Shaw. There is a lot of talent that will be 
leaving the Administration, and we have got to be concerned 
about that.
    We are now going to recess for approximately 15 minutes.
    [Recess.]
    Chairman Shaw. I noticed before the break that a former 
member of this committee, Barbara Kennelly, was here. Is she 
still here?
    Well, if she comes in, I would like to introduce her 
because she was a most respected member of this committee. 
Maybe she is missing these long hearings and she just decided 
to drop by.
    The panel that we have before us right now is Sue Augustus, 
who is Associate Director of the SSI Coalition for a 
Responsible Safety Net, from Chicago; Gerald McIntyre, who is 
Directing Attorney, National Senior Citizens Law Center, in Los 
Angeles, California; Witold Skwierczynski--I bet you didn't 
think I would pronounce that correctly--President of the 
National Council of Social Security Administration Field 
Operations Locals, American Federation of Government Employees, 
AFL-CIO, Council 220, and is Co-Chair of the AFGE-SSA National 
Partnership Council, also of Chicago; Terri Spurgeon, who is 
the President of the National Association of Disability 
Examiners, from Zachery, Louisiana; James Hill, President of 
the National Treasury Employees Union, Chapter 24, Cleveland 
Heights, Ohio; and Steve Korn, the President of the National 
Coalition of Social Security Management Associations, 
Incorporated, from Vallejo, California.
    We have each of your full testimony which, without 
objection, will be made a part of the record, and we would 
invite you to summarize as you see fit.
    Ms. Augustus?

 STATEMENT OF SUE AUGUSTUS, ASSOCIATE DIRECTOR, SSI COALITION 
        FOR A RESPONSIBLE SAFETY NET, CHICAGO, ILLINOIS

    Ms. Augustus. Thank you, Chairman. Good morning, Chairman 
Shaw and members of the subcommittee. I want to thank you for 
your invitation to testify on the service delivery challenges 
facing the Social Security Administration.
    The SSI Coalition is a policy and advocacy organization 
that focuses on the SSI program and other public benefit 
programs that provide cash assistance and health care to low-
income elderly and people with disabilities. In addition to 
legal representation, we convene a statewide working group on 
work incentives that brings advocates, State agency staff, and 
Social Security staff to the table to address employment 
barriers to people with disabilities. This work provides us 
with the information that I bring to you this morning to 
illustrate the systemic problems of service delivery within the 
Social Security Administration.
    As you have heard in the earlier hearings on this subject, 
SSA is facing big challenges. The expected baby boom generation 
retirees, as well as a more diverse and technologically-savvy 
population in general, will tax the ability of SSA's employees 
to effectively and efficiently handle its workload. To these 
challenges, I would add another, the increasing number of 
people with disabilities who are returning to work.
    I would be remiss for not thanking you, Chairman Shaw, and 
other members of the committee who voted for the Work 
Incentives Improvement Act of 1999. This legislation, which 
needs to be fully funded, will benefit individuals with 
disabilities who return to work by offering them increased 
access to health care and providing them some additional 
benefit protections if they are unable to continue working 
because of their disability.
    The booming economy has created a need for more qualified 
employees, and people with disabilities are finding that there 
are many job opportunities available to them, in part through 
medical advances and assistance technology, as well as changes 
in attitude and the law, notably the Americans With 
Disabilities Act.
    Having said that, I must point out that SSA has a real 
challenge at the local field office level in dealing with 
people with disabilities who return to work. There are many 
reasons for this. The work incentive provisions available are 
complex and confusing. SSA does not have the staff time to 
provide the necessary outreach to publicize the programs. Many 
staff in the local field offices do not understand the work 
incentive provisions and give out wrong information to 
beneficiaries.
    There is inconsistency in how to handle earnings reporting 
at the field office and at the 800 number, and the work flow at 
the field offices tends to relegate earnings reporting and 
post-entitlement issues to the bottom of the pile. These 
problems, which I believe stem in large part to inadequate 
staffing at the local offices and some bureaucratic 
intransigence at SSA, have devastating consequences for those 
who go back to work.
    The cyclical nature of many disabilities, both physical and 
psychiatric, also pose a challenge to those who try and work 
while trying to maintain their benefits and health coverage. As 
a result of the complexity of the work incentives, 
beneficiaries end up with large overpayments. It is not 
uncommon to see overpayments ranging from $5,000 to $30,000. 
Although SSA is taking steps to address these problems, the 
current situation is a real barrier to employment.
    There are other service delivery challenges that remain and 
they have a common theme. There is a failure to communicate, 
and I don't say this flippantly. This failure occurs in a 
number of ways. The written notices that were referenced 
earlier that SSA sends to beneficiaries are really difficult to 
understand. Reaching the local field offices by telephone is a 
challenge. When you reach a local office, the staff does not 
have time to adequately explain things or they do not have your 
file.
    The SSA staff tends to speak in the same arcane 
bureaucratic language that is included in the written notices, 
so you are no better off having reached a real person. The 
chances of getting accurate information on work incentives is 
rare, and if you are an SSI recipient, the chances that you 
will understand anything about the income and asset rules is 
exceedingly slim.
    SSA is addressing many of these issues. The National Office 
of Employment Support is a huge step in the right direction. We 
want to commend Commissioner Apfel, Deputy Commissioner Susan 
Daniels, Associate Commissioner Ken McGill, and our own Region 
V Commissioner Jim Martin for raising the level of service 
delivery, especially in the area of return to work issues.
    There are many dedicated and knowledgeable staff at SSA. I 
hope that you will seriously consider the recommendations of 
the Social Security Advisory Board and give SSA the resources 
it needs to deliver accurate and efficient service.
    Thank you very much for this opportunity.
    [The prepared statement follows:]

Statement of Sue Augustus, Associate Director, SSI Coaltion for a 
Responsible Safety Net, Chicago, Illinois

    Chairman Shaw, Chairman Johnson, and members of the 
Subcommittees on Social Security and Human Resources, I want to 
thank you for your invitation to testify on the service 
delivery challenges facing the Social Security Administration 
(SSA).
    The SSI Coalition is a policy and advocacy organization 
that focuses on the Supplemental Security Income (SSI) program 
and other public benefit programs that provide cash assistance 
and health care to low-income elderly and people with 
disabilities. Our individual and organizational members range 
from consumers with physical and/or psychiatric disabilities to 
community based organizations working with people with 
disabilities. We also provide individual legal representation 
to individuals with Social Security problems. In addition, we 
convene a state-wide working group on work incentives that 
brings advocates, state agency staff and SSA staff to the table 
to address employment barriers to people with disabilities. The 
legal representation and the working group provides us with the 
information that I bring to you to illustrate the systemic 
problems of service delivery within the administration of the 
SSA programs.
    As you have heard in the earlier hearing on this subject, 
SSA is facing big challenges. The expected baby boom generation 
retirees and an increase in disability claims, as well as a 
more diverse and technologically savvy population in general, 
will tax the ability of SSA's employees and infrastructure to 
efficiently and effectively handle its workload. To these 
challenges, I would add another--the increasing number of 
people with disabilities who are returning to work.
    I would be remiss for not thanking the members of this 
subcommittee who voted for the Work Incentives Improvement Act 
of 1999. This legislation will benefit individuals with 
disabilities who are or who have been SSI or SSDI beneficiaries 
by offering them increased access to health care coverage, and 
providing them with some additional benefit protections if they 
are unable to continue working because of their disability. The 
Social Security Administration has shown its leadership in this 
area by creating a National Office of Employment Support, 
signaling for the first time SSA's commitment to helping people 
return to work, instead of just providing them with a benefit 
check. The booming economy has created a need for more 
qualified employees, and people with disabilities are finding 
that there are many more job opportunities available than ever 
before thanks, in part, to medical advances and assistive 
technology, as well as changes in attitude and the law, notably 
the Americans with Disabilities Act.
    Having said that, I also must point out that SSA has a real 
challenge at the local field office level in handling the 
workload created by people with disabilities who return to 
work. It is no secret that there is much misinformation and 
ignorance about Social Security's work incentives. There are 
many reasons for this--the work incentive provisions are 
complex, confusing and contradictory; SSA does not have the 
staff time to provide the necessary outreach; many SSA staff in 
the local field offices do not understand the work incentive 
provisions and give out wrong information to beneficiaries; 
there is inconsistency in how to handle earnings reporting at 
the field office and at the 800 number; and the workflow at the 
field offices tend to relegate earnings reporting and post 
entitlement issues to the bottom of the pile. These problems, 
which I believe stem from inadequate staffing and training at 
the local offices, have devastating consequences for 
beneficiaries who go back to work.
    People with psychiatric disabilities have a very tough time 
managing their benefits when they return to work. The cyclical 
nature of many disabilities--both physical and psychiatric--
also pose a challenge to those who try and work while trying to 
maintain their benefits and health care coverage. As a result 
of the complexity of the work incentives, beneficiaries end up 
with large overpayments--it is not uncommon to see overpayments 
ranging from $5,000 to $30,000. Many beneficiaries who receive 
overpayment notices are so devastated that they quit their 
jobs, and some are hospitalized as a result of the stress. Once 
a beneficiary receives an overpayment, she is faced with filing 
appeals and waivers, which tend to be time-consuming and 
psychologically draining tasks.
    SSA must address these issues as soon as possible. The 
Office of Employment Support is a step in the right direction, 
and SSA has other initiatives underway to address the workflow 
issues. There are a number of policy decisions SSA could make 
without waiting for new legislation. For instance, as more 
people move away from sheltered workshops and into supported 
employment, SSA could use a fairer method of calculating 
subsidies for those in supported employment. SSA also needs to 
change the culture at SSA -which presently does not encourage 
work attempts--to a more positive and less punitive atmosphere 
for the working beneficiary. Providing clear and concise 
information on work incentives, and streamlining earnings 
reporting, will assist in reducing burdensome overpayments.
    Thus, ironically, because more beneficiaries are going back 
to work, SSA has another workload challenge to add to the 
boomer retirement wave.
    There are other service delivery challenges that exist at 
local SSA field offices. I am incorporating here my comments to 
the Social Security Advisory Board at their hearing last April 
in Chicago.

Accessibility

    The office hours of the local offices must become more 
flexible to accommodate working individuals. Evening and 
weekend hours would be more helpful. For many workers, taking 
time off to go to an SSA office is not only an inconvenience, 
but it could mean the loss of a job. Waiting times at many 
offices are still too long. Even with scheduled appointments 
there are long waits. In fact, scheduling an appointment can 
mean a wait of several weeks. This is unacceptable if someone 
is waiting on a decision that will affect payment of benefits. 
Some offices, mainly the older ones, lack areas that provide 
confidentiality.
    In the Chicago area, calling a local field office can be an 
exercise in futility. Historically, the local offices in 
Chicago change their telephone numbers frequently. 
Organizations and advocates that serve consumers trade updated 
lists of telephone numbers as avidly as good recipes. Even with 
a ``good'' telephone number, it is difficult to get a 
representative on the line. The new voicemail systems installed 
in many of the offices are both a blessing and a curse. If you 
know your party's extension, it is helpful to be able to leave 
a message. However, if you do not know the extension, it is 
many times impossible to get out of the voicemail loop to even 
leave a message. Many consumers with cognitive, psychiatric 
disabilities and language barriers find it difficult to 
navigate a voicemail system. There should always be a default 
to a live operator. I also have clients who are deaf who 
complain about their inability to receive a response from SSA 
on a TTY.
    There are many complaints about the 800 number. I believe 
that beneficiaries would rather receive accurate information, 
particularly about work incentive information, than have their 
call answered within a certain number of minutes. Beneficiaries 
that report wage information to the 800 number frequently 
receive overpayment notices because the reported information is 
never associated with their records.
    The SSA web site is excellent. It contains a wealth of 
information and is not terribly difficult to navigate. The 
problem with the Internet in general is its inaccessibility to 
those without Internet access and to those whose primary 
language is not English. The best way to provide outreach to 
underserved communities is to have multi-cultural, bi-lingual 
SSA employees bring a networked computer to events in the 
community. This allows SSA staff to answer specific questions 
and to take information directly from beneficiaries. This has 
worked well in Chicago.

SSA Employee Performance

    There are many complaints about the level of knowledge and 
accuracy of information obtained from SSA employees. Most of 
the complaints I hear are about the work incentives programs. 
Most SSA employees that deal with the public do not have a 
grasp of these provisions, and many impart erroneous 
information about them. As a result, beneficiaries rely on this 
information, and end up with overpayments. There has to be 
either better training of front-line SSA employees on the work 
incentive programs, or all work incentive questions must be 
expeditiously referred to a work incentive specialist in the 
office. In addition, there should be training on dedicated 
savings accounts issues, or a specialist in each office. For 
any issue that is more complicated, a specialist or two in each 
office, who is available to the public, would be helpful.
    Consumers, advocates, and parents of children with 
disabilities frequently complain about the courtesy and 
responsiveness of SSA employees. As a lawyer, I am usually 
treated with respect. However, this does not always happen with 
the general public. If an advocate is able to cultivate a 
relationship with a particular SSA office or employee, the 
advocate is generally able to get courteous responses. It 
should not take a lawyer, or an advocate with connections, to 
receive respectful, courteous treatment and accurate 
information.
    Those who are most vulnerable, individuals with 
disabilities and individuals with language barriers, are 
frequently treated the worst. SSA must provide training to all 
of its employees, especially its front-line employees, on 
disability issues, particularly psychiatric disabilities. 
Parents of children with disabilities are routinely treated 
poorly, especially when dealing with dedicated savings accounts 
issues. SSI beneficiaries frequently report that there is a 
pervasive attitude at SSA that they are out to defraud the 
system.
    At the same time, SSA has some of the most courteous and 
loyal employees of any government agency. Their workload has 
increased over the last few years as their numbers have 
dwindled. It does not appear that they have the time to 
adequately explain the intricacies of the programs to the 
public. The staffing reductions seem to have taken a toll on 
their ability to provide ``world-class'' service.

Clarity and Usefulness of Written Materials

    As lawyers, we appreciate the due process information that 
must be included in notices regarding benefit awards or 
changes. However, the notices in general are atrocious. Most 
beneficiaries cannot understand the notices they receive from 
SSA, and, in fact, I have a difficult time understanding some 
of them myself. The notices are not clear. There is 
misinformation in them. For example, the COLA notice that goes 
out to SSDI beneficiaries at the end of the year contains 
misleading information, because these notices are sent not only 
to DI beneficiaries, but to retirement beneficiaries as well.
    Another major problem is that beneficiaries receive too 
many notices. Clients sometimes receive four and five different 
notices a week -each saying something different! When the 
payment center sends out a notice about an overpayment, the 
local office does not have a copy of it, so calling the local 
office about it is fruitless. The local SSA office frequently 
does not have copies of notices sent out by Baltimore. There 
does not appear to be a central file, either computer or paper, 
that contains all the notices that a client receives, with the 
result that there is nobody at SSA that can review them and 
make sense of them. There must be some centralization of 
notices, preferably at the local office.
    In summary, advocates recommend that the notices be clear, 
brief, contain accurate information, and be understandable by 
someone with a fourth grade reading level. There should be a 
local telephone number listed on the notice so that the 
recipient can call for answers to questions. SSA should not 
send out multiple notices containing conflicting information. 
Different offices within SSA should not send out notices if 
possible. Otherwise, copies of all notices should be available 
at the local office.
    SSA has undertaken a plain language initiative to try and 
make its publications more comprehensive. We look forward to 
seeing the results.

Claiming Benefits

    The disability determination process should be shortened 
and made more accurate. SSA must help claimants understand the 
importance of obtaining their medical records, and SSA must do 
more to try and obtain those records. There is a disparity 
among the field offices in terms of their processing of claims 
both before and after a Bureau of Disability Determination 
Services (BDDS) decision. In some field offices, paperwork is 
lost, or is delayed in getting to the BDDS. We have had many 
cases where we sent definitive medical evidence of disability 
to the BDDS that was never associated with the disability file. 
As a result, the claims were denied, and the claimants had to 
wait for months (or over a year) before the favorable decision 
was made at the Office of Hearings and Appeals (OHA) level. The 
disability decisions made by the BDDS should be more accurate, 
particularly in the case of HIV and psychiatric disabilities. 
The medical doctors at the BDDS need updated training on HIV/
AIDS issues. The cursory consultative examinations that SSA 
purchases are widely viewed as inadequate. This leads to delays 
in making the correct disability decision.
    The representative payee issue is also problematic. SSA 
does not assist an individual in finding a representative 
payee. Frequently there is little or no investigation of a 
family member who serves as a representative payee, even when 
the beneficiary alleges that the representative payee is 
improperly using the money. SSA needs to sensitize its staff on 
the treatment of special populations, such as the homeless, 
those with psychiatric disabilities, and parents of children 
with disabilities.
    It would be helpful if referrals to vocational 
rehabilitation were made much earlier in the disability 
determination process. After a claimant tries for years to be 
found disabled by SSA, it is many times too late to begin the 
vocational rehabilitation process. There should also be better 
communication between SSA and the state agencies responsible 
for both Medicaid and vocational rehabilitation.

Program Accuracy and Integrity

    The SSI income and asset regulations are very complicated 
and confusing. Trying to explain them to SSI beneficiaries is 
very difficult. SSA's task of verifying income and resources in 
the SSI program would be much easier if the regulations were 
not so complex and there were more state agency agreements to 
share information. In addition, because some SSA employees in 
the local field offices have an attitude that most SSI 
beneficiaries are defrauding the system, it sets up a hostile 
environment and there is decreased cooperation on both sides.
    Unfortunately, there are instances of fraud and abuse in 
the system. Those that defraud and abuse the system should be 
discovered and penalized for it. SSA can address many instances 
of overpayment in the SSI program by making timely and accurate 
decisions on Continuing Disability Reviews and explaining more 
clearly the income and resource rules. Unnecessarily punishing 
beneficiaries who are trying to abide by the rules and assuming 
that everyone is trying to defraud the program does not promote 
the integrity of the programs.

Public Understanding of Social Security

    There are many misconceptions among the general public 
about the programs SSA administers. Many individuals I 
represent do not know what kind of benefit they are receiving, 
nor do their family members. The SSI program, in particular, is 
misunderstood. As mentioned, the SSA website is a high-tech way 
to reach a certain part of the population. The best way to 
reach many individuals outside of SSA offices is at local 
community events with knowledgeable bi-lingual employees. The 
public affairs staff at SSA can go a long way toward fostering 
better understanding of the SSA program. The staff reductions 
at SSA appear to have diminished the agency's ability to serve 
its customers, and we hope that there will not be further 
cutbacks.

Information and Referral Services

    Although SSA provides many people with referrals unrelated 
to the programs it administers, it could do a better job. The 
SSI beneficiary is particularly vulnerable to the lack of 
information about Medicaid eligibility. Although the 1619 
program is a work incentives program, most of the SSA field 
office staff does not even know that it exists. It can take SSA 
months to make a 1619(b) determination, which means in the 
interim that the SSI beneficiary, at least in Illinois, can 
lose Medicaid eligibility for those months. The notices that 
SSA sends out on 1619 are confusing and often misleading to the 
beneficiary.
    SSA can create better notices and train its staff on the 
work incentives. SSA and the state Medicaid agencies should 
have a better working agreement, and refer beneficiaries to 
specific employees in their respective offices who understand 
the interplay between the programs.

Conclusion

    Although our criticisms may seem harsh, they are offered in 
a constructive spirit. And all is not bleak. We want to commend 
Commissioner Apfel, Deputy Commissioner for Disability and 
Income Security Susan Daniels, Deputy Commissioner Ken McGill 
and Region V Commissioner James Martin for their leadership and 
responsiveness to our concerns about barriers to work for 
people with disabilities. We have seen an incredible change in 
SSA's attitude toward working with advocates to resolve 
problems. There are many knowledgeable, courteous and loyal SSA 
employees. Our overtures to SSA on many issues have been met 
with enthusiasm. SSA appears to be dedicating more time and 
resources to getting out into the community and working with 
groups. The creation of the Office of Employment Support 
signals a real commitment to assisting SSI and SSDI 
beneficiaries who want to return to work. We welcome these 
initiatives, and hope that SSA will have the necessary 
resources to carry out this commitment.
    We also agree with the recommendations of the Social 
Security Advisory Board report issued in September, 1999. SSA 
needs more funding to carry out its mission to meet the 
challenges of this new century and deliver world class service.
    We appreciate the opportunity to air our concerns, and we 
look forward to continuing our partnership with SSA to find 
solutions to address these challenges. I would be happy to 
answer your questions. Thank you.
      

                                

    Chairman Shaw. Mr. McIntyre?

 STATEMENT OF GERALD A. McINTYRE, DIRECTING ATTORNEY, NATIONAL 
      SENIOR CITIZENS LAW CENTER, LOS ANGELES, CALIFORNIA

    Mr. McIntyre. Mr. Chairman, my name is Gerald McIntyre. I 
want to thank you for this opportunity to present our views to 
the committee.
    I am Directing Attorney of the Los Angeles office of the 
National Senior Citizens Law Center, and work with elderly 
legal services programs across the country. Social Security and 
SSI programs have been at the core of our work since the 
Center's founding in 1972.
    For the past 9 years, we have worked with advocates from a 
number of different organizations in an effort to obtain better 
access to services for SSA's customers with limited English 
proficiency. I am pleased to report that the past several years 
have seen considerable progress in SSA's efforts to better 
serve its limited English proficiency, or LEP, customers. The 
agency has changed its policies to recognize its responsibility 
to provide an interpreter when an individual is not able to 
communicate adequately in English. It has done this out of a 
desire to assure equal access to its services and out of a 
concern for program integrity.
    However, in spite of undeniable progress, much important 
work remains to be done if SSA is to respond effectively to the 
needs of the limited English proficient population. Most 
important is the need for systems improvements to enable SSA to 
obtain information on the language spoken by each of its 
customers.
    At present, SSA captures this information on all new Title 
II and Title XVI claims, but does not obtain this information 
for its existing customer base. Until it obtains this 
information for all of its customers, implementation of SSA's 
interpreter policy will continue to be highly uneven and 
inefficient. Without this information, SSA field office staff 
does not know whether or not an appointment should be scheduled 
with a bilingual staff member, and SSA will lack adequate 
management information to best utilize the language resources 
it already has on staff.
    The absence of language information about its customers 
also means that SSA is currently unable to effectively 
communicate in writing with its limited-English customers. At 
present, SSA does have some Spanish language SSI notices, but 
does not have any notices in other languages, which are an 
increasing presence in the customer base. However, SSA is 
unable to properly target even the limited number of Spanish-
language notices when it does not systematically record the 
language used by each of its customers.
    SSA must establish the capacity to send important written 
notices in a language the recipient will understand. This is 
already done by many States administering benefit programs of 
similar complexity. For example, Washington State sends written 
notices in 85 different languages in its Medicaid program. When 
notices are sent in a language recipients cannot understand, 
the results are more over-payments, more under-payments, more 
field office visits, and a greater strain on limited field 
office resources.
    Another area that needs to be looked at is the feasibility 
of establishing toll-free telephone service for additional 
languages when it makes economic sense to do so. This not only 
will result in better service to people speaking those 
languages, but also will result in the better use of agency 
resources by enabling the agency to handle these inquiries 
expeditiously rather than through a time-consuming visit to a 
field office.
    American industry has come to the realization that if it 
wishes to compete for the business of the limited English 
proficient population, it must offer them services in a 
language they can understand. Serving customers in their own 
language is now recognized as a key element in gaining a 
competitive edge and is simply good business. America's seniors 
should be able to expect at least as good a level of customer 
service from their Government when it deals with matters vital 
to their welfare and security as they have come to expect from 
the best of private enterprise in their role as consumers.
    Thank you.
    [The prepared statement follows:]

Statement of Gerald A. McIntyre, Directing Attorney, National Senior 
Citizens Law Center, Los Angeles, California

    Mr. Chairman and Members:
    My name is Gerald McIntyre. I want to thank you for the 
opportunity to present our views to the Committee. I am 
Directing Attorney of the Los Angeles office of the National 
Senior Citizens Law Center, which works with elderly legal 
services programs across the country on a broad range of legal 
issues affecting the security and welfare of older persons of 
limited means. The Social Security and SSI programs have been 
at the core of our work since the Center's founding in 1972.
    For the past nine years, we have worked with advocates from 
a number of organizations representing older persons and 
persons with disabilities in an effort to obtain better access 
to services for SSA's customers with limited English 
proficiency. I am making this statement on behalf of several 
such organizations.\1\
---------------------------------------------------------------------------
    \1\ This statement is submitted on behalf of Christopher Bowes, 
Center for Disability Advocacy Rights (CeDAR), New York, NY, Linda 
Landry, Disability Law Center, Boston, MA and Edwin Lopez-Soto, Greater 
Upstate Law Project, Rochester, NY. In addition, we want to convey 
special thanks to Gillian Dutton of Northwest Justice Project, Seattle, 
Washington, who has worked with us on this issue since the beginning 
and has provided valuable information based on her experience in 
Washington State.
---------------------------------------------------------------------------
    We are pleased to report that the past several years have 
seen considerable progress in SSA's efforts to better serve its 
Limited English Proficiency (LEP) customers. The agency has 
changed its policies to recognize its responsibility to provide 
an interpreter when an individual is not able to communicate 
adequately in English. It has done this out of a desire to 
assure equal access to its services and out of a concern for 
program integrity. In an effort to obtain more accurate 
disability determinations and in response to the increased need 
for disability determinations for elderly non-citizens as a 
result of the Balanced Budget Act, this policy has been 
extended to the state agencies that make disability 
determinations for SSA.
    SSA has in the last few years hired an increased number of 
bilingual personnel. It has established training programs and 
prepared manuals to better utilize their skills. In addition, 
SSA has established a standing Non-English Speaking/Limited 
English Proficiency (NES/LEP) Workgroup drawn from various 
components of the agency which has performed a major leadership 
role in helping the agency clarify its policies and provide 
efficient services to this population. To his credit, the 
Commissioner has recognized the importance of these 
contributions by giving the NES/LEP Workgroup an award for its 
vision and hard work.
    However, in spite of undeniable progress, much important 
work remains to be done if SSA is to respond effectively to the 
needs of the LEP population. Most important is the need for 
systems improvements to enable SSA to obtain information on the 
language spoken by each of its customers. At present SSA 
captures this information on all new Title II and Title XVI 
claims, but does not obtain this information for its existing 
customer base. Until it obtains this information for all of its 
customers, implementation of SSA's interpreter policy will 
continue to be highly uneven and inefficient. Without this 
information, SSA field office staff does not know whether or 
not an appointment should be scheduled with a bilingual staff 
member. As a result, appointments often have to be rescheduled 
with considerable inconvenience and expense for both the 
individual and SSA. Furthermore, the failure to obtain this 
information means that SSA lacks adequate management 
information to best utilize the language resources it already 
has on staff.
    The absence of language information on its customers also 
means that SSA is currently unable to effectively communicate 
in writing with its LEP customers. At present SSA does have 
some Spanish language SSI notices, but does not have any 
notices in other languages. However, SSA is unable to properly 
target even the limited number of Spanish language noties when 
it does not systematically record the language used by each of 
its customers.
    Understandable written communications are essential to 
quality service delivery. Without them, services are second 
rate. This is true in any environment, but especially so in the 
administration of complex public benefit programs. This is 
especially so for immigrants whose dealings with SSA are more 
complex because of the additional inquiry required to establish 
the validity of documents from another country and because of 
the greater complexity of the laws and regulations surrounding 
immigrant eligibility for benefits.
    SSA must establish the capacity to send important written 
notices in a language the recipient will understand. This is 
important, not just from the standpoint of providing quality 
service to the individual, but also from the standpoint of 
overall agency efficiency.
    When beneficiaries receive notices in a language they do 
not understand, some people will try to find a friend, relative 
or neighbor to translate it. The problems with this approach 
are:
     (1) the person doing the translating all too often 
also has a limited grasp of the English language thus assuring 
the transmission of inaccurate information,
     (2) the beneficiary may be obliged to disclose 
otherwise confidential personal information to his or her 
detriment, and
    (3) it results in delay that often causes an individual to 
miss important response deadlines \2\.
---------------------------------------------------------------------------
    \2\ For example, SSI notices often require a response within ten 
days.
---------------------------------------------------------------------------
    Another common reaction for a person receiving an English 
language notice they do not understand is to bring the notice 
in to the local SSA office to find out what it means. This may 
require an elderly person to make two trips to the SSA office 
since there may not be anyone available to talk to the person 
in their language and an appointment may need to made for a 
second visit. The result is not only poor service to that 
individual and the possibility of a missed response deadline, 
but also a diversion of scarce agency resources from other 
tasks to deal with two unnecessary visits, thus affecting the 
level of service for everybody.
    SSA should look at the efforts of state and local 
governments which are now sending notices to benefits 
recipients in several languages. The best example in this 
regard is the State of Washington which sends written notices 
to benefits recipients in eighty-five languages. This includes 
notices for the Medicaid program which has eligibility 
provisions similar to those of SSI. While the challenges of 
implementing such a program on a national scale are much 
greater, the Washington State experience shows that it can be 
done.
    In recent years, SSA has placed increased emphasis on its 
nationwide toll-free telephone service as a means of handling 
routine inquiries and thereby reducing the field office 
workload. SSA needs to consider the feasibility of establishing 
separate toll-free numbers for different language groups where 
it makes economic senses to do so. This will not only result in 
better service to people speaking those languages, but will 
also result in better use of agency resources by enabling the 
agency to handle these inquiries expeditiously, rather than 
through a time-consuming visit to a field office.
    American industry has come to the realization that, if it 
wishes to compete for the business of the LEP population, it 
must offer them services in a language they can understand. 
Companies, large and small, now regularly solicit business, 
both in writing and orally, in a wide range of languages. A 
prime example of this can be found in the highly competitive 
long distance business, where the largest and smallest 
providers and their customers communicate with their customers 
in many languages. Another example was described in a recent 
New York Times article about a no-frills shopping mall in 
Queens, New York that has become one of the nation's most 
profitable by emphasizing service to immigrants and which has 
an information booth which can provide translation services in 
21 different languages. (The article is attached as an Appendix 
to this statement.) Serving customers in their own language is 
now recognized as a key element in gaining a competitive edge 
and is simply good business. America's seniors should be able 
to expect at least as good a level of customer service from 
their government when it deals with matters vital to their 
welfare and security as they have come to expect from the best 
of private enterprise in their role as consumers. We believe 
they are entitled to have SSA's performance measured by the 
same standards that would be applied to those private 
enterprises which seek our business.
    Finally, we agree with the recommendation of the Social 
Security Advisory Board on the need for providing SSA with 
additional resources. The strain on resources already shows 
with the current caseload and can only be expected to increase 
with the retirement of the baby boomers and the projected 
increase in the number of LEP customers. At present, the policy 
on interpreters is excellent, but implementation is highly 
uneven and agency efforts to monitor compliance and to 
consistently reinforce the policy are inadequate. We suspect 
that one reason for this is inadequate staffing levels, 
exacerbated by the reduction in the number of mid-level 
supervisory personnel, as pointed out in the Advisory Board's 
report.
    In closing, we urge SSA to devote considerably more effort 
to ensuring compliance with its existing interpreter policy and 
to embark on a course of providing notices to LEP individuals 
in their own language. This action should not be deferred as it 
will not become any easier as the number of LEP customers 
continues to grow. We have seen from the example of Washington 
State that it can be done and we know that SSA has the 
leadership needed to carry it out. We urge Congress to see to 
it that SSA has the resources required to provide quality 
service to all of America's seniors.

Nothing Gaudy but Sales Figures; No-Frills Queens Center Outshines Most 
                    Luxury Malls

    There is no marble, no chandeliers, no gourmet food court 
or Neiman Marcus at the Queens Center Mall, an aging shopping 
plaza where the landscaping consists of fake ficus trees and 
the atrium is highlighted with neon lights and a giant plastic 
Bugs Bunny statue.
    As for its mauve and beige and windowless exterior, 
Lorraine O'Neill, the mall's manager, put it bluntly: ``It is 
ugly.''
    So why is this cramped, dated mall causing twinges of 
jealousy among owners of upscale suburban-shopping meccas, 
places where visitors sip lattes under imported live palm trees 
and where Bugs Bunny is more likely found on a pricey T-shirt?
    Despite its decidedly no-frills style, the 27-year-old mall 
in Elmhurst is one of the best-performing in the nation. Sales 
per square foot there--about $760 in 1999--are more than twice 
the national average. It even outperformed luxury-oriented 
centers like Tysons Galleria in suburban Washington, which sold 
about $680 per square foot in 1999 at stores including Versace 
and Max Mara, a spokeswoman for the mall owner said.
    The quiet success of the Elmhurst mall, owned by the 
Macerich Company, based in Santa Monica, Calif., is a testament 
to the growing buying power of the surrounding Queens 
community, a sizable share of which is made up of recent 
immigrants, who turn to the mall for goods to set up new 
households or ship back to relatives.
    As the only large-scale enclosed mall in the borough, it 
also illustrates the shortage of shopping alternatives for 
middle-class Queens, a reality that some of the nation's 
biggest retailers are scrambling to correct.
    ``Queens Center clearly does much better than most people 
realize,'' said William S. Taubman, executive vice president of 
the Taubman Company, a Macerich competitor. ``Even most people 
in our industry don't realize it.''
    The cash registers at Queens Center ring year-round, from 
the ground-floor Baskin-Robbins, which has the second highest 
sales of the 250 outlets in the New York region, to the top-
floor Children's Place, the top-performing store of the 
national chain's 293 outlets. Sales at the two mall anchors--J. 
C. Penney and Macy's--also put these stores among the national 
chains' top performers, company officials said.
    Much of its success can be attributed to its location at 
90-15 Queens Boulevard: it sits in the middle of a borough of 
two million residents, atop a subway line and alongside the 
Long Island Expressway. Macerich's managers have also assembled 
a mix of retailers--from Father and Son Shoes to Lechters 
housewares--that seem ideally matched to the needs of this 
particular set of shoppers.
    Retail analysts say that the youthful makeup of the 
customer base contributes to the mall's high sales. Popular 
labels like Tommy Hilfiger and Polo Sport sell consistently at 
shops there, in part because of a desire by many of the 
community's first-generation Americans to assimilate into their 
adopted culture, said Malachy Kavanagh, a spokesman for the 
International Council of Shopping Centers, based in New York.
    ``The mall is a conduit to the American dream,'' Mr. 
Kavanagh said. ``You might still have a language barrier, but 
very quickly, if I buy the Levi's jeans, the Michael Jordan 
sneakers, the Tommy Hilfiger jackets or Polo shirts, I can look 
like an American.''
    The frequent travel between native lands and Queens by many 
of the mall's customers also drives sales, said Paco Underhill, 
a New York retail consultant who has visited the Queens mall.
    ``Queens, almost like Miami, is an acquisition capital of 
America for goods leaving the country,'' said Mr. Underhill, 
author of the recent book ``Why We Buy: The Science of 
Shopping'' (Simon & Schuster). ``People are buying icons of 
American culture to take them back with them.''
    All this was evident on a recent evening at Queens Center, 
which buzzed with shoppers even after the holiday frenzy. 
Customers packed the Victoria's Secret store, feverishly 
grabbing for sale items. Employees at Baskin-Robbins could not 
scoop ice cream fast enough for a steady flow of customers. 
Upstairs at Macy's, shoppers lined up at the housewares 
registers, their arms filled with merchandise.
    One Macy's customer, Paulina Espin, walked out with a 
toaster oven, pressure cooker and several bowls. She moved to 
New York City with her family seven months ago from Quito, 
Ecuador, and has turned to the Queens mall to fill her house 
with essential goods.
    ``I need so many things,'' she said.
    Shahzad Azmat of Kew Gardens added about $150 to the mall 
sales that evening, buying dolls, watches, children's clothing, 
shirts, perfumes and other goods he and his wife planned to 
take to their native Pakistan as gifts for family and friends.
    Meanwhile, Alexis Cartagena, 18, a recent graduate of 
Newtown High School in Elmhurst, was hanging out with his 
friends and looking for must-have clothes. ``Every day, there 
is something that looks cool,'' said Mr. Cartagena, who was 
wearing a Polo shirt, Mecca jeans, Spider cap and Dolomite 
boots. ``You come here, you see stuff, you want to buy it.''
    The ethnic diversity at the mall is evident on every floor. 
Customers lined up in one row of tables at the food court were 
natives of Guatemala, Korea, El Salvador, Jordan and 
Bangladesh, as well as Queens.
    At least 21 languages are spoken at the mall, according to 
a list kept at the customer service desk, which can arrange 
translation services.
    Over all, the steady stream of customers generated about 
$105 million in total sales at the mall last year, not 
including the anchor stores. That figure is far smaller than 
those of many giant malls, with the extreme being the Mall of 
America in Bloomington, Minn., with its 4.3 miles of 
storefronts.
    But on a square-foot basis, sales at Queens Center last 
year totaled about $760, an increase of $20 a square foot from 
1998, when it was already more than twice the national average 
of $320. Garden State Plaza in Paramus, N.J., and King of 
Prussia Mall in suburban Philadelphia, in comparison, each 
listed about $470 per square foot of sales in the recent tally 
by the Directory of Major Malls, an industry publication.
    Exceptional retail sales in Queens are not limited to the 
mall. Home Depot has three outlets in the borough, two of which 
are open 24 hours a day. All three stores--in Long Island City, 
Flushing and Ozone Park--rank among the top 10 in performance 
in the 913-unit chain. Retailers nationwide have noticed all 
the money being made. A result is a flurry of blueprints that 
should soon mean lots of new shopping options for residents of 
Queens.
    Macerich, the owner of Queens Center Mall, wants to invest 
about $200 million to double the mall's retail sales area, by 
building an annex atop a municipal parking lot across the 
street. The expanded mall is to include skylights, real trees 
and sit-down restaurants.
    Mattone Group, a family-owned developer based in College 
Point, Queens, intends to build an 18-screen movie theater on 
top of a second nearby municipal parking lot in Elmhurst. And 
Forest City Ratner, based in Cleveland, wants to add a new 
floor to the Stern's store nearby after the department store 
closes to accommodate a Target store, other retail space and 
another multiplex movie theater.
    ``The pent-up demand is so strong,'' said John E. Simley, a 
spokesman for Home Depot, which intends to open its fourth 
Queens store, on Woodhaven Boulevard, in mid-February and is 
already planning a fifth, in College Point. ``It is not like 
suddenly two million people moved to Queens. I guess it was 
just overlooked for some time.''
    Some Queens residents are concerned that the building plans 
are too ambitious. Community Board 4 in Corona recently voted 
to oppose the construction of the new movie theaters planned 
for one of the municipal parking lots next to the mall.
    ``You already have gridlock traffic every day, even on 
weekends,'' said Rose Rothschild, district manager for 
Community Board 4. ``Imagine if they all get approval. It is 
going to make a big mess.''
    But borough leaders--noting that they are committed to 
ensuring that the construction does not overwhelm Queens--said 
they have long been waiting for respect from retailers that the 
borough deserves.
    ``There are precious few places in Queens where you can 
shop and get a wide variety,'' said Borough President Claire 
Shulman, who often shops at Queens Center Mall. ``Big retailers 
have suddenly discovered us, and now they are making out like 
gangbusters. It is about time.''
      

                                

    Chairman Shaw. Thank you.
    Mr. Skwierczynski?

STATEMENT OF WITOLD SKWIERCZYNSKI, PRESIDENT, NATIONAL COUNCIL 
  OF SOCIAL SECURITY ADMINISTRATION FIELD OPERATIONS LOCALS, 
AMERICAN FEDERAL OF GOVERNMENT EMPLOYEES, AFL-CIO, COUNCIL 220, 
 AND CO-CHAIR, AFGE-SSA NATIONAL PARTNERSHIP COUNCIL, CHICAGO, 
                            ILLINOIS

    Mr. Skwierczynski. Good morning. Thank you, Chairman Shaw, 
Ranking Member Matsui, and other members of the subcommittee. I 
am with the union. I represent 50,000 bargaining unit Social 
Security Administration employees. We have a veteran workforce. 
Our average age of our workers is about 46 years old. Our 
workers are about 73 percent female. We work in about 1,300 
field offices and 36 teleservice centers and 132 hearings 
offices.
    We have a dedicated, veteran workforce who care deeply 
about the program that we administer. The employees reflect the 
face of Social Security in the community. Unfortunately, we 
have many less faces than we have had before. We work in 
community-based facilities. We know the problems of our 
clientele. We not only deliver Social Security services, but we 
also refer our clients to a wide variety of other community-
based services.
    SSA's community-based service has been the foundation and 
the key to public acceptance of Social Security, and its 
accessibility to a vulnerable clientele--senior citizens, 
disabled people, the poor, and survivors of breadwinners who 
die prematurely. The SSA clients consistently tell Social 
Security on focus groups and also in surveys that they want to 
maintain the community-based service, that they want a 
caseworker whom they can rely on to process their claim, refer 
them to other community-based agencies and services, decide 
their claim, and help them file an appeal.
    The budget and staffing cuts of the last two decades have 
jeopardized the ability of Social Security to continue to 
provide efficient, caring, speedy, and accurate community-based 
service. The Social Security Advisory Committee report released 
last fall has highlighted this crisis. Our employees have been 
telling us, the union, about this for years. In 40 percent of 
our field offices, the staffing levels have gone down to 15 or 
less employees. With that type of staffing, which is the result 
of about 29-percent cuts in our field organization, it is next 
to impossible to continue to provide the kind of broad-based 
service that our customers desire and deserve.
    There has been increased office closings that the 
administration has initiated to try to deal with the size of 
our offices. We have an 800 number service that requires 
shifting employees from other kinds of work in order to answer 
the millions of calls that we are getting. Many of our offices 
have frequent lengthy waits of 2 to 4 hours for customers who 
want service. These are disabled customers and senior citizens. 
Many of them, when they seek an appointment, have to wait 3 to 
4 weeks in the future to get that appointment.
    While Social Security workloads have increased, Congress 
has responded by cutting staff. Our veteran workers have 
utilized overtime to try to keep up with the workloads. The 
response by Congress and the administration has been to cut 
overtime. In the fiscal year 2001 budget, the work-years for 
overtime would constitute an 85-percent cut over 2 years.
    This continuous assault on the staffing levels of Social 
Security and overtime make it next to impossible for us to 
continue to provide the services that are expected. Our 
stressed-out, overworked staff can no longer tolerate the 
situation. Retirements are up, and many employees tell me that 
they are counting the days until they retire because they can 
no longer work in that kind of environment.
    The union applauds Commissioner Apfel's alternative budget, 
which I think will move us in the correct direction, stems the 
tide, and offers some modest FTE and overtime increases. We 
don't think it is enough. The proposed budget does not go far 
enough. It doesn't even go to fiscal year 1999 levels. We think 
some drastic measures are needed.
    Off-caps, we are in favor of. We think SSA is a unique 
program. We think the American public would support that 
Congress view it as different from other agencies and take a 
hard look at the type of staffing and resources that are needed 
for Social Security. We think off-caps is necessary.
    We think that the service delivery schemes, such as 
Internet service, applications on the Internet, and claims at 
first contact, need to be rethought. We don't think the 
American public is looking for centralized Social Security 
service. We think they desire community-based service, 
something like the DCM. I have testified on the DCM at our last 
hearing. I think the DCM is something that you need to schedule 
another hearing for and look at how we can provide the kind of 
community-based service that the public wants.
    The disability area--the DCM project indicates that claims 
are processed faster, more expeditiously, as accurate as the 
current process, and that something that works where you get a 
single caseworker making a decision, helping a client get 
through their disability claim, explaining to them the 
reasoning of the decision, is something that we need to explore 
the legal problems and eliminate the legal barriers that makes 
that work.
    In summary, I think we are in a crisis situation. These are 
not just words. The employees understand it, and we need to 
come to grips with the fact that in order to provide a Social 
Security service that is of world-class, you have got to 
provide the resources for it.
    [The prepared statement follows:]

Statement of Witold Skwierczynski, President, National Council of 
Social Security Administration Field Operations Locals, American 
Federation of Government Employees, Council 220, and Co-Chair, AFGE-SSA 
National Partnership Council, Chicago, Illinois

    Chairman Shaw, Ranking Member Matsui, and members of the 
Social Security Subcommittee, I want to thank you for your 
invitation to testify on the subject of SSA's service delivery 
and SSA's readiness for the impending wave of baby boomer 
beneficiaries. AFGE welcomes the opportunity to encourage the 
prompt action that is needed to ensure that the Social Security 
Administration can fulfill its current and future obligation to 
serve the American people.
    I would like to extend our gratitude to Stanford Ross and 
the SSA Advisory Board for their candidness and presentation of 
the reality of SSA's ability to meet the publics needs. We 
salute the Advisory Board insight and dedication to fulfill the 
mandate of the 1994 legislation that established Social 
Security as an Independent Agency.
    AFGE embraces the SSA Advisory Board's report, which 
validates the Union's position presented in testimony to 
Congress over many years. For the first time, SSA has openly 
acknowledged the stress and strains placed on employees due to 
the lack of staff and resources needed to provide the level of 
world class service that the public expects and deserves. For 
the first time, SSA has begun to address operational and 
organizational shortcomings.
    The Union has, for many, many years, urged Congress to take 
SSA off budget. This would allow SSA programs to be set at a 
level that fits the needs of Social Security's contributors and 
beneficiaries, rather than at an arbitrary level that fits 
within the current government cap on discretionary spending. 
Already understaffed, SSA was once again subjected to arbitrary 
spending caps as a result of the 1997 Budget Deficit Act. This 
short fall was accomplished without consideration to the 
increased beneficiary population and service demands. As an 
outcome SSA is forced to compete for limited funding with other 
federal programs such as Head Start, WIC, meat inspection, 
Education and VA administrative costs. We find this incredulous 
since SSA administrative expenses, by statute, must be paid 
from the trust fund.
    We commend Commissioner Apfel for submitting an annual 
budget independent of the President's budget according to the 
Social Security Independence Act of 1994. The Commissioner's 
budget requesting 66,300 total workyears is an improvement over 
the President's budget inadequacies of 63,831 total workyears. 
Although neither budget achieves the 1999 total workyears of 
66,459, AFGE believes that Commissioner Apfel's budget is a 
step in the right direction. For a comparison of FY 2001 Budget 
Requests to Congress for SSA by President Clinton and 
Commissioner Apfel see Addendum A.
    SSA is a unique government program, fully supported by the 
Congress and the American public with a trust fund surplus at 
an all time high. We serve the elderly, people with physical 
and mental disabilities, children who have lost parents, 
spouses who have lost a partner. These people need our benefits 
to survive. These people deserve the highest level of quality 
service that we can provide. This is not happening. SSA 
administrative expenses are lower than any insurance company 
can provide. SSA administrative expense must not be limited by 
an arbitrary spending cap. SSA must be adequately funded to 
meet the needs of the people we serve. SSA administrative 
expenses can and should be taken off-budget. The American 
public deserves no less.
    We have given you our proposed solution, now we will take 
this opportunity to present some of the problems that we feel 
SSA must correct to prepare for the impending increase in 
beneficiaries.

Staffing Problems

    Our Union represents more than 50,000 employees almost 1300 
field offices, 132 offices of Hearings and Appeals, 36 
Teleservice Centers, 7 Program Service Centers, a Data 
Operations Center, Central Office, the National Computer Center 
and 10 Regional Quality Review Offices.
    Over the last 20 years, governmental agencies as a whole 
suffered a 12% reduction. During this same period, SSA's 
overall workforce was reduced by 27%. Most devastating to 
quality service however was the more severe impact of the 29% 
reduction in direct service staff who work in local community 
offices. As a result of staff reductions, service has 
deteriorated. Additionally a decline in accuracy and timeliness 
have been caused by dramatic increases in disability claims and 
appeals, and the complexity of other additional workloads. 
Congressional mandates without consideration to the additional 
staff needed to fulfill the mandates has also contributed to 
the erosion of quality service. AFGE has called for the 
restoration of adequate staffing levels for years. We know 
where the problems are and what the solutions need to be. 
Congress, the Administration, and SSA decision-makers have been 
unresponsive. We feel Congress had been mislead based on SSA's 
incorrect assumptions concerning technology replacing staff. 
Computers do not replace people. The SSA Advisory Board has now 
joined us in advocating for more staff and an independent 
budget to improve program administration.
    Simply put, we have fewer employees to do more and more 
work. SSA's human resources are stretched to the breaking point 
so that we can't give the American people the world class 
service they need or deserve. For example:
     In our Prescott, AZ office, more than 25% of its 
staff was lost within this past year. Post entitlement 
workloads, such as overpayments and the posting of wages for 
Supplemental Security Income benefits, are not being processed 
due to a lack of staff.
     In our San Francisco Region, a temporary 
moratorium was placed on SSI redeterminations, so that some of 
the backlogged post entitlement workloads could be processed.
     In our Fremont and Hayward California offices, 
loss of staff has caused major backlogs in all workloads, 
making prioritization difficult. Post-entitlement workloads, 
such as wage reports are not processed timely, resulting in 
overpayments.
     In our Sacramento, California offices, SSI 
workloads are tremendous. Although pending workloads are equal 
in our Sacramento District Office and our South Sacramento 
office, our South Sacramento Office has 40% less staff to 
accomplish the same goals.
     In one of our San Diego California field offices 
customers wait two (2) hours to speak to a Social Security 
Representatives. During peak periods of the day or month, 
waiting time increases to four (4) hours.
     In our New Britain and Bristol, Connecticut field 
offices, all workloads are falling behind. They desperately 
need overtime to try to catch up. Out of 7 CRs, 2 are eligible 
for retirement and because they are so stressed out, they are 
very tempted to leave. There is no motivation to continue 
working at SSA.
     In the Kankakee Illinois field offices, staffing 
shortages have resulted in 3-4 day delay in the adjudication of 
RSDI claims. The average waiting time is \1/2\ hour. Depending 
on daily staffing, waiting times could easily increase to a one 
(1) hour wait. Critical payments take 2-3 days. Additionally, 
four contact stations were closed, one of them an hour drive 
forcing the public to use the phone or drive an hour to the 
office.
     Our Easton, Pennsylvania field office is 
supporting the Stroudsburg, Pennsylvania Branch Office where 5 
of 8 employees retired at the end of FY99 leaving 2 experienced 
claims representatives and 1 service representative to serve 
the community. Although 5 replacements were hired, 2 quit and 
the recently hired trainee Claims Representatives will work in 
the office for a few months before they go to 13 weeks 
additional training. The first available teleclaim appointment 
for the Stroudsburg/Easton schedule is 3 weeks. The Easton 
office has been taking teleclaim appointments for the 
Stroudsburg office since last October and expects to continue 
to do so for another 4-5 months. The Easton office has 2 
Service Representatives on duty and is understaffed by 2.
     In our Meadville, Pennsylvania field office, RSDI 
waivers and work CDRs are backlogged and will take months to 
resolve. Additionally, backlogs of wage verification and inputs 
cannot be processed, and will predictably result in 
overpayments.
     In our Sharon, Pennsylvania field office, employee 
report that all workloads are backed up and since there is no 
overtime, there is no hope to catch up.
     In our McKinney, Texas field office, staffing 
shortages and the inability to replace lost staff has resulted 
in GS-11 Claims Representatives absorbing the additional 
workloads/duties of GS-8 Service Representatives. This has 
resulted in delays in services (i.e. appointments, benefits, 
and general information) to the McKinney community. It has been 
estimated that an additional three (3) FTEs are needed to meet 
the needs of this community to keep up with fast growing Collin 
county.
     In our San Antonio Texas field office, medical 
CDRs are being mailed and later reviewed by a volunteer 
student, instead of completed during a mandatory face to face 
interview with an experienced GS-11 Claims Representative. This 
same procedure is being implemented throughout the nation.
    Additionally, SSA's aging workforce will result in a great 
number of retirements at the same time the agency's workloads 
are expected to rise. The loss of experience and program 
knowledge will be devastating if we do not make every effort to 
immediately hire and fully train new employees to replace 
anticipated personnel losses. New employees should be given 
every opportunity to be taught and mentored by our most 
seasoned workers. However, given the everyday pressures of 
doing ``more with less,'' and as workloads become increasingly 
stressful and backlogs grow, SSA employees have become much 
more motivated to retire as soon as they become eligible. We 
call on Congress to direct SSA to actualize a hiring plan 
immediately, while time permits to adequately hire and train 
new employees.
    Another important area that has suffered as a result of 
staffing cuts is the Office of Quality Assurance tasked to 
investigate and uncover fraud, waste and abuse. The staffing 
has been cut so drastically that quality review audits are 
limited to cases in metropolitan areas. Whereas quality 
assurance staff previously conducted reviews in field offices 
nationwide to ensure accurate work product, they no longer have 
the staff or the resources to perform this function.

Community Based Service

    Only our network of community based field offices can 
effectively handle the public's business by whatever means the 
public chooses as its method of contact. Staffing levels in 
these offices must be consistent with the public service needs 
of the residents in these communities.
    Social Security's field offices have become ``a beginning 
place of access'' for other public and private social service 
agencies. As the Advisory Board was able to confirm, people go 
to the Social Security office because they do not know where 
else to turn for help. Because SSA serves as a community 
resource, we believe SSA should retain it's community based 
capacity with adequate staffing to provide quality service.
    Consolidation and closure of field offices has proven 
counter productive and become a major public relations problem 
for SSA and a hardship on the elderly and disabled. To 
complicate the matter, in areas of the country that are growing 
by leaps and bounds, SSA has not considered opening additional 
field offices to meet the public's needs. For example, the city 
of Austin, Texas is one of the largest growing cities in the 
country. There is only one field office to serve the city's 
more than one million citizens. The Austin office has 
experienced more than a 25% reduction in staff. Las Vegas, 
Nevada is the fastest growing city in the United States with 
more than 1.2 million citizens. Las Vegas grows by more than 
50,000 people each year. Despite all this, SSA has only two 
field offices to service the Las Vegas area. These two (2) 
offices cannot keep up with public demands.
    Austin, Texas, Easton/Stroudsburg Pennsylvania and Las 
Vegas, Nevada, are just a few examples of how the Agency has 
not recognized the needs of growing communities. Longer waiting 
times, backlogged workloads and high personnel turnovers are 
the apparent results of insufficient staffing and lack of 
planning.
    SSA Focus Groups of current and future beneficiaries 
throughout the country strongly voiced preference for community 
based service. A local office presence is the resounding choice 
in conducting important personal business, such as applying for 
benefits and resolving check problems. The public preferred the 
option of doing routine business by phone with the local office 
or a Teleservice Center. When questioned, the public expressed 
no interest in receiving service from third parties or other 
non-SSA personnel, especially when fees are involved.
    SSA intends to prematurely launch its plans to allow 
beneficiaries to file claims via the Internet in April 2000. 
While AFGE recognizes that the use of the Internet will be an 
acceptable and convenient method of filing claims in the 
future, security safeguards and adequate protection of 
individual privacy does not yet appear to be in place. AFGE, 
still mindful of the online PEBES fiasco, strongly believes 
that Congress should take a long hard look at the security and 
privacy issues before a scheduled release. Additionally, we do 
not believe that the public is willing to deal with the 
complexity of a 90-page screen application.
    AFGE is also very concerned and believes that Congress 
should be alerted to watch closely and recognize that Internet 
claims taking could result in more centralized workloads and 
the closing and consolidation of community based offices in 
every congressional district.

SSA's 800 Number

    Our Teleservice employees must be empowered to handle more 
calls to completion, thereby allowing the public to complete 
more of its business with SSA in a single contact.
    One of the most serious service delivery problems that SSA 
faces is its telephone service. Due to restrictions on hiring, 
SSA's Teleservice Centers have too few employees to handle the 
more than 70 million calls received by the national 800 number 
each year. Therefore, employees at the seven (7) Payment 
Service Centers and its Central Office are forced to put aside 
critical workloads and instead are assigned to answer calls or 
``spike'' during peak hours on the national 800 number. Last 
year, ``spikes'' were used more than 100 workdays. While the 
agency has stated that using PSC employees would be a temporary 
measure, the practice has been ongoing and increasing for 10 
years!
    Teleservice Center employees are encouraged to resolve 
calls as soon as possible. If employees take too long on calls, 
their knowledge of SSA programs is questioned. If employees try 
to keep responses short, they are often criticized for not 
providing good public service. Therefore, calls that could not 
be resolved quickly or thoroughly, are referred to field 
offices for follow up service. This not only creates a very 
stressful work environment but it also leaves employees 
frustrated and provides little satisfaction of doing a job well 
done under difficult circumstances.
    Because of the tremendous amount of pressure put on 
Teleservice representatives and their managers to meet the goal 
of answering 95% of calls to the national 800 number in five 
minutes, backlogs and workload priorities do not allow for 
sufficient training. The SSA Advisory Board found that ongoing 
training is essential to building and maintaining the knowledge 
and skills that employees need. SSA's growing program 
complexity requires a higher level of programmatic knowledge. 
Without necessary ongoing training, accuracy of information 
will continue to be compromised.

The Disability Claims Manager

    The Disability Claims Manager (DCM) pilot position was 
defined in my October 1999 testimony to this subcommittee. All 
indication in Phase I are that the DCM is a viable customer 
service initiative. Claimants are extremely satisfied to have a 
single point of contact from their initial disability interview 
through the medical decision on their case.
    Phase II of the DCM test began November 1999. This is the 
formal evaluation period when SSA will continue to measure 
enhanced public service, employee satisfaction, productivity, 
the allowance rate, quality assurance and processing time. The 
SSA/DDS environmental fit must be determined, and 
administrative cost estimated. AFGE believes that the DCM 
position is the most efficient means for continuity of claimant 
services between the medical and non-medical parts of their 
claim.

    Why the Disability Claim Manager (DCM) Position?

    A claimant in Jacksonville, Florida said that his 
experience with a DCM was that ``she was patient, courteous and 
supportive in handling my claim for disability. In an 
impersonal world which easily frustrates the mentally 
handicapped she stands head and shoulders above the rest in 
dedication to fairness in working for such a large government 
entity.''
    A licensed clinical social worker in Denver who is an 
advocate for the homeless or those at risk of becoming homeless 
and have persistent mental illness or a terminal illness. He 
says, ``I have had the incredibly fortunate opportunity to 
assist three clients in applying for disability benefits 
through the DCM pilot. Rather than the cumbersome and 
complicated traditional process, the DCM allowed for the 
application to be completed in one office, in one visit, by a 
decision-maker who I could readily reach by phone!''
    National work sampling data reveals that two thirds of the 
disability claims are for SSI and 80% of SSI allowances have 
some type of mental impairment. This segment of our population 
needs to have access to a claims manager in a face to face 
interview setting to navigate them through the disability 
process.
    Another claimant in Helena Montana wrote to thank a DCM for 
his excellent help; noting, ``the pilot program obviously is a 
success! It was very nice of you to take time to explain the 
procedures. My claim was completed quickly and courteously, 
eliminating all the stress and anxiety for my family during 
this time of tragedy.'' Even claimants that are denied 
disability benefits have written letters expressing their 
appreciation for this process which enabled them to deal with 
one decision-maker, participate in the process, and understand 
the reason for their denial.
    AFGE strongly believes that the DCM should be implemented 
within the field office structure nationwide. We question SSA's 
commitment to DCM implementation as evidenced by their refusal 
for an independent evaluation of Phase II, with no SSA 
evaluation plan yet finalized.
SSA's Union-Management Relationship

    We believe that SSA needs a service delivery plan that will 
guide the Agency through the next ten years that will address 
the service needs of current and future beneficiaries during 
the same period SSA will be losing the majority of its current 
workforce to retirement. We believe that SSA employees 
understand better than anyone what steps need to be taken to 
improve service to the public. SSA needs to address these 
issues far more aggressively than it has in the past if it is 
to meet the challenges in the coming decade. We continue to be 
prepared to work together with SSA top management to seek 
improvement in service.
    As I previously testified in October 1999, Labor-Management 
Partnership and the Disability Process Redesign are 
inextricably connected. SSA and AFGE worked together to write 
the recommendations that comprised the Disability Redesign 
proposal. Several tests, pilots, and prototypes started during 
the Redesign have demonstrated the efficiency of working in 
partnership and cooperation with the Union in planning and 
implementing improved processes.
    Federal employees can process both disability and non-
disability aspects of claims quickly, accurately, and 
successfully. The public likes one stop service, which the DCM 
provides. We are dismayed by DDS resistance to the recognized 
success of the DCM pilot and SSA's willingness to gut it. DDS 
has opposed expansion of the DCM pilot even though a neutral 
party documented both the service improvements and increased 
public and employee satisfaction. It appears that DDS fear for 
loss of staff may be an unrealistic when the success of the DCM 
pilot utilizes both State and Federal employees. AFGE believes 
that Congress should research legal implications and make 
statutory changes if necessary to allow federal and state 
employees to make disability decisions.

Conclusion

    The SSA Advisory Board recommends cooperation and teamwork 
in the disability process yet SSA displays an unwillingness to 
move forward with full implementation of the DCM program 
despite it's screaming success. AFGE is willing to work in 
cooperation with SSA top management in a continued effort to 
improve the disability process that better serves the American 
people.
    AFGE is willing to work with SSA to improve the work 
environment, ensure a safe and healthy workplace, provide 
opportunities for training and promotion and most importantly 
improve public service. However SSA is still reluctant to have 
first line employee representatives involved in the decision 
making process. AFGE continues to be concerned with SSA's 
unilateral implementation of policies and trends that include 
centralizing workloads that cost face to face contacts, could 
result in loss of staff from field offices that will most 
likely close or consolidate offices and weaken community based 
service. Another potentially dangerous trend in our opinion is 
the proposed applications on the Internet. Without security and 
encryption protections this endangers privacy and personal 
security of all social security number holders and we believe 
potentially makes individual records vulnerable to hackers. We 
urge Congress to pay particularly close attention to SSA action 
in this area.
    We agree with the Advisory Board's findings that SSA's 
administrative budget should be set at a level that fits the 
needs of Social Security's taxpayers and beneficiaries rather 
than at an arbitrary level which fits within the government's 
overall discretionary spending cap. If SSA's administrative 
budget is not explicitly excluded from the cap on discretionary 
spending, SSA is forced to compete with other Federal agencies 
for scarce resources within the spending limits defined by law. 
The result will be SSA's inability to provide world class 
service to tens of millions of Americans in the next decade.

                            Comparison of FY 2001 Budget Request to Congress for SSA
                                  [By President Clinton and Commissioner Apfel]
----------------------------------------------------------------------------------------------------------------
     LIMITATION ON  ADMINISTRATION
            EXPENSES (LAE)                     Commissioner's  Budget                President's  Budget
----------------------------------------------------------------------------------------------------------------
Base Operations.......................                      $6,866 million                       $6,684 million
Capital Investment....................                         $40 million                                    0
Additional Funding for CDRs...........                        $450 million                         $450 million
Total LAE.............................                      $7,356 million                       $7,134 million
OIG...................................                         $76 million                          $73 million
Research (Sect 1110, SSI acct)........                         $34 million                          $30 million
Total Budgetary Resources.............                      $7,466 million                       $7,237 million
----------------------------------------------------------------------------------------------------------------

----------------------------------------------------------------------------------------------------------------
                                                              2000                      Apfel  FY     President
                 STAFFING                      FY1999      President's  2000  Actual      2001         FY 2001
                                                             Budget                      Request       Request
----------------------------------------------------------------------------------------------------------------
FTE Full-time Permanent...................       59,000        60,000        60,000        60,400        60,000
SSA FTE...................................       62,972        63,573        63,350        64,049        63,140
SSA Overtime..............................        3,292         2,062         1,664         2,061           500
SSA Workyears.............................       66,459        65,824        65,203        66,300        63,831
----------------------------------------------------------------------------------------------------------------

----------------------------------------------------------------------------------------------------------------
                                                             FY 2000                    Apfel  FY     President
       Component  FTE;s and  OT WY)            FY 1999     President's   2000 Actual      2001         FY 2001
                                                             Budget                      Request       Request
----------------------------------------------------------------------------------------------------------------
Operations................................       47,017        47,058        47,360        47,360        47,126
                                                (2,448)       (1,249)       (1,089)       (1,447)         (145)
Hearings/Appeals..........................        8,041         7,865         7,782         7,680         7,782
                                                  (550)         (361)         (300)         (361)         (122)
Others....................................        7,504         7,657         7,540         7,679         7,410
                                                  (290)         (249)         (272)         (249)         (229)
OIG.......................................          428           536           536           590           584
                                                    (4)           (3)           (3)           (4)           (4)
----------------------------------------------------------------------------------------------------------------

      

                                

    Chairman Shaw. Thank you.
    Ms. Spurgeon?

STATEMENT OF TERRI SPURGEON, PRESIDENT, NATIONAL ASSOCIATION OF 
            DISABILITY EXAMINERS, ZACHERY, LOUISIANA

    Ms. Spurgeon. Chairman Shaw, members of the committee, on 
behalf of the members of the National Association of Disability 
Examiners, I want to thank you for this invitation to testify 
today at your second hearing of Social Security's Readiness for 
the Impending Wave of Baby Boomer Beneficiaries.
    NADE is a professional association whose purpose is to 
promote the art and science of disability evaluation. Our 
members have a unique understanding of the problems facing the 
program at this time and a strong commitment to maintaining 
meaningful and viable disability programs. Although the 
majority of our members are employed within the State 
disability determination offices, our membership also includes 
SSA claims reps, physicians, psychologists, attorneys, 
advocates, and other professionals who work with and are 
interested in the evaluation of disability claims.
    We believe the diversity of our membership, as well as our 
experience working directly with the Social Security and SSI 
disability programs, allows us to address the problems from a 
practical and realistic viewpoint. We understand the impact 
these programs have on the lives of the disabled individuals 
and their families. We also recognize that the compelling needs 
of these individuals must be met within a framework of fiscal 
responsibility.
    The perspective from which NADE views SSA's readiness for 
handling the impending workload is unique. We acknowledge that 
SSA has been focused on the future of the disability programs. 
We have expressed support for exploring measures that may 
improve customer service, reduce program cost, and increase 
employee satisfaction. Many of the proposals look good on 
paper, but the reality of testing and implementation has taken 
its toll on the DDS resources. Without adequate additional 
resources to implement and/or test the initiatives, DDSs have 
to rely on the limited number of experienced employees in our 
current budgets. The remainder has been stretched to 
operational limits in order to handle the usual daily workloads 
and has resulted in an unusually high number of turnovers in 
many of the State agencies.
    Front-line workers are reluctant to consider the future of 
the agency programs because they are so stressed and can't 
handle the current levels of stress that they are working under 
today. The increasingly rapid turnover of case processing staff 
and the continuing loss of experienced personnel will have a 
significant impact on the quality of the service that the DDSs 
can provide and that the public needs. This potential adverse 
effect on service delivery is an important issue for NADE, 
DDSs, and this committee.
    The reduction in the number of field office personnel and 
the increase in the number of telephone claims has had a 
negative impact on the completeness of these initial 
applications as received in the DDSs. Disability adjudicators 
are forced to spend additional time recontacting claimants to 
adequately complete the applications. This has had a positive 
impact on the quality of our decisionmaking process, but on the 
flip side it has had a negative impact on the processing time 
and the time that adjudicators need to spend on their other 
duties.
    In April of 1994, SSA issued its Plan for a New Disability 
Claim Process. The five primary objectives of this plan were to 
make the process user-friendly, make the right decision the 
first time, make decisions as quickly as possible, make the 
process efficient, and make the working environment 
satisfactory for the employees.
    In March of last year, following 5 years of piloting 
various elements of the redesign plan, the Commissioner 
announced his decision to begin implementation of a new process 
which combined several of the key elements from the original 
plan. These included the single decisionmaker, the pre-decision 
interview, expanded rationales, elimination of the 
reconsideration step in the appeal process, and the 
improvements on the hearing process.
    Beginning with the initial claims filed on or after October 
1, the new process was to be prototyped in 10 State DDSs, which 
represented about 20 percent of the initial applications. NADE 
had previously expressed concerns about the negative impact on 
the OHA workloads as a result of eliminating the recoin step 
from the appeals process. We didn't believe that the full 
impact imposed by the new process in terms of processing time 
and examiner responsibilities had been adequately evaluated.
    For that reason, we were pleased that it was being 
prototyped instead of just rolled out nationally. Now that we 
are 5 months into the new process, it is a little early to 
really know exactly what the numbers are adding up to. But the 
preliminary anecdotal evidence suggests that the new process 
neither increases customer satisfaction, nor does it improve 
employee morale. Results of the prototype must be evaluated 
carefully and objectively before national rollout can be 
implemented.
    It is commonly recognized that it takes at least 2 years 
for a disability examiner to become proficient at the position. 
This time is likely to increase as the complexity of the 
process and the diversity of the customer base increases. While 
nationwide the number of disability examiners with less than 2 
years of experience has increased, the DDSs are also faced with 
a large percentage of staff reaching retirement age.
    When SSA began administering the SSI program in 1973, most 
of the DDSs hired a large number of staff to accommodate that. 
As employees are reaching retirement age, the pool of 
experience we are going to be losing, and that is going to 
leave us at a loss for having the right people there to train 
our new employees and do mentoring.
    NADE has consistently urged that SSA's administrative 
budget, like its program budget, be removed from the cap on 
discretionary spending. We concur with the views expressed by 
the Advisory Board that SSA's staffing resources have declined 
significantly over the last two decades, while the agency's 
workload has increased and become more complex. The agency's 
tight resource constraints limits its capacity to respond to 
the growing workloads. This is as true in the DDSs as it is in 
the field offices. Additional staff is needed to handle the 
increasingly complex workloads.
    SSA has announced their intention to revise and update a 
number of the medical listings. While it is important that the 
criteria used to establish disability be updated, this again 
impacts on resources. As presented to this Association, these 
changes in the listings, which include emphasis on credibility 
and functionality, will require substantial training and will 
significantly increase the demands on the adjudicators.
    The time necessary for an examiner to address issues like 
credibility and functionality will increase the time 
adjudicators will spend on each case. And while this should 
increase the quality of our decisionmaking, it will decrease 
the time available to spend on other cases. Adjudicators will 
necessarily have to assume smaller caseloads. This will result 
in increased need for additional staffing in the DDSs.
    Many of SSA's administrative costs are fixed and rising. 
Therefore, in order to meet the current budget limitations on 
administrative costs, the DDSs are being asked to reduce 
medical expenditures. Accurate medical decisions require 
quality medical evidence. Both program costs and public service 
are negatively impacted if spending for administrative costs is 
not sufficient to ensure accurate decisions. Program costs will 
increase if claims are allowed inappropriately, and public 
service will certainly decline if the claims are denied 
inappropriately.
    SSA has launched initiatives to improve the quality and 
retrieval of the medical evidence of record and the purchase of 
consultative exams that are necessary in the adjudicative 
process. However, the DDSs are not sufficiently staffed to 
implement the essential outreach and training for these 
activities. We are unable to undertake the actions necessary to 
improve the quality of medical evidence, as current resources 
are not sufficient for effective outreach to the medical 
community and preclude the desirable monitoring of the CE 
providers. Staff shortages require all resources be directed to 
the adjudicative positions. Again, NADE acknowledges the need 
for these improvements, but recognizes the inability of the 
DDSs to implement due to the shortfall of resources.
    In conclusion, NADE would like to offer the comment that 
the ability of SSA and the DDSs to successfully meet the 
challenges of the future workload is contingent on many 
features, some of which have been mentioned in this testimony. 
The committee has already heard from a variety of witnesses and 
will hear from others. NADE is very grateful for this 
opportunity to share some of our concerns.
    SSA workloads are projected to increase, and the disability 
workload alone is expected to increase by 47 percent over the 
next 10 years. Because of the increasing complexity of the 
workload and the continuing changes that are being made in the 
program itself, SSA and the DDSs must begin today to prepare 
for the tremendous challenge. If we are to begin, we must be 
allowed the tools and resources to do so.
    Mr. Chairman, Honorable Members, thank you for the 
opportunity to present this and for listening to our ideas.
    [The prepared statement follows:]

Statement of Terri Spurgeon, President, National Association of 
Disability Examiners, Zachery, Louisiana

    Chairman Shaw and members of the Subcommittee, on behalf of 
the members of the National Association of Disability Examiners 
(NADE), I want to thank you for this invitation to testify 
today at your second hearing on Social Security's Readiness for 
the Impending Wave of Baby Boomer Beneficiaries.
    NADE is a professional association whose purpose is to 
promote the art and science of disability evaluation. Our 
members have a unique understanding of the problems facing the 
Social Security program at this time and a strong commitment to 
maintaining a meaningful and viable disability program. 
Although the majority of our members are employed in the state 
Disability Determination Service (DDS) agencies, our membership 
also includes Social Security claims representatives, 
physicians, psychologists, attorneys, advocates and other 
professionals who work with, and are interested in, the 
evaluation of disability claims. We believe the diversity of 
our membership, as well as our experience working directly with 
the Social Security and SSI disability programs, allows us to 
address problems from a practical and realistic viewpoint. We 
understand the impact these programs have on the lives of 
disabled individuals and their families. We also recognize that 
the compelling needs of these individuals must be met within a 
framework of fiscal responsibility.
    The perspective from which NADE views SSA's readiness for 
handling the impending workload is unique. We acknowledge that 
SSA has been focused on the future of the Disability Programs. 
We have expressed support for exploring measures that may 
improve customer service, reduce program costs, and increase 
employee satisfaction. Many of the proposals look good on paper 
but the reality of testing and implementation has taken its 
toll on DDS resources. Without adequate additional resources to 
implement and/or test the initiatives, DDSs have had to rely on 
the limited number of experienced employees and current 
budgets. The remainder has been stretched to operational limits 
in order to handle the usual daily workloads and has resulted 
in an unusually high number of turnovers in many state 
agencies. Front line workers are reluctant to consider the 
future of the Agency Programs, as they are unable to handle the 
current levels of stress they are now working under. The 
increasingly rapid turnover of case processing staff and the 
continuing loss of experienced personnel will have a 
significant impact on the quality of service delivery that the 
DDS's can provide and the public deserves. This potential 
adverse effect on service delivery is an important issue for 
NADE, for the DDSs, and this Committee.
    The reduction in the number of Field Office personnel and 
the increase in the number of telephone claims have had a 
negative impact on the completeness of these initial 
applications received in the DDSs. Disability adjudicators are 
forced to spend additional time re-contacting the claimants to 
adequately complete the applications. This has had a positive 
impact on quality of the decision-making process but a negative 
impact on processing time and the time adjudicators have to 
spend on other duties.
    On April 1, 1994 the Social Security Administration issued 
its Plan for A New Disability Claim Process. The five primary 
objectives of this plan were:
     Making the process ``user friendly `` for 
claimants and those who assist them
     Making the right decision the first time  
Making the decision as quickly as possible
     Making the process efficient
     Making the work satisfying for employees.
    In March 1999, following five years of piloting various 
elements of the Redesign Plan, the Commissioner announced his 
decision to begin implementation of a new process, which 
combined several key elements of the original plan. These 
included:
     A single decision maker
     Pre-decision interview (now known as a Claimant 
Conference)
     Expanded explanations
     Elimination of the reconsideration level of appeal
     Improvements in the Hearing process
    Beginning with initial claims filed on or after October 1, 
1999, this new process was to be prototyped in 10 state DDSs 
and would include 20% of the total initial disability claim 
workload.
    NADE had previously expressed concern about the negative 
impact on OHA workloads as a result of eliminating the 
Reconsideration step from the appeals process. We did not 
believe the full impact imposed by this new process in terms of 
processing time and examiner responsibilities, had been 
adequately evaluated. For that reason we were pleased that it 
was being prototyped rather than being rolled out nationally.
    We are now five months into the new process. Although it is 
too early to know with certainty, preliminary anecdotal 
evidence suggests that this new process neither increases 
customer satisfaction nor improves employee morale. Results of 
the prototype must be evaluated very carefully and objectively 
before national rollout of the new process. Also, before this 
new process can be successfully rolled out, DDSs must begin to 
hire and train adequate staff to handle this workload. This 
hiring and training of new staff, and the necessary retraining 
of current staff, must begin immediately if the DDS's are 
expected to be in a position to successfully handle the 
workload. What we are seeing instead is the continued loss of 
experienced staff and, because of Federal and State budget 
reductions, the inability to hire and properly train 
replacements.
    It is commonly recognized that it takes at least two years 
for a disability examiner to become proficient. This time is 
likely to increase as the complexity of the process and the 
increasing diversity of our customer base increases. While 
nationwide the number of disability examiners with less than 2 
years of experience has increased, the DDSs are also faced with 
a large percentage of staff reaching retirement age. When SSA 
began administering the SSI program in 1973, most DDSs hired 
large numbers of examiners to handle that workload. These 
employees are now reaching retirement age. As this pool of 
experience is lost it will become more difficult for the DDSs 
to train and mentor new examiners.
    NADE has consistently urged that SSA's administrative 
budget, like its program budget, be removed from the cap on 
discretionary spending. We concur with the views expressed by 
the Social Security Advisory Board that: ``. . . SSA's staffing 
resources have declined significantly over the last 2 decades, 
while the agency's workload has increased and become more 
complex. The agency's tight resource constraints limit its 
capacity to respond to these growing workloads.'' This is as 
true in the DDSs as it is in the Field Offices. Additional 
staff is needed to handle the increasingly complex workload.
    The Social Security Administration has announced their 
intention to revise and update a number of the medical 
listings. While it is important that the criteria used to 
establish disability be updated, this again impacts resources. 
As presented to this Association these changes in the listings-
including an increased emphasis on credibility and 
functionality--will require substantial training and will 
significantly increase the demands on adjudicators. The time 
necessary for an examiner to address issues like credibility 
and functionality will increase the time adjudicators will 
spend on each case. While this should increase the quality of 
our decision-making, it will decrease the time available to 
spend on other cases. Adjudicators will necessarily have to 
assume smaller caseloads. This will result in an increased need 
for additional staff in the DDSs.
    Many of SSA's administrative costs (salary, maintenance, 
etc.) are fixed or rising. Therefore, in order to meet the 
current budget limitations on administrative costs, the DDSs 
are being asked to reduce medical expenditures. Accurate 
medical decisions require quality medical evidence. Both 
program costs and public service are negatively impacted if 
spending for administrative costs is not sufficient to ensure 
accurate decisions. Program costs will increase if claims are 
allowed inappropriately and public service will decline if 
claims are denied inappropriately.
    SSA has launched initiatives to improve the quality and 
retrieval of the medical evidence of record (MER) and/ or the 
purchase of consultative examinations (CEs) necessary to the 
adjudicative process. However, the DDSs are not sufficiently 
staffed to implement these essential outreach and training 
activities. We are unable to undertake the actions necessary to 
improve the quality of medical evidence as current resources 
are not sufficient for effective outreach to the medical 
community and preclude the desirable monitoring of CE 
providers. Staff shortages require that all resources be 
directed to adjudicative positions. Again, NADE acknowledges 
the need for these improvements but recognizes the inability 
for DDSs to implement due to the shortfall of available 
resources.
    In conclusion, NADE would offer the comment that the 
ability of SSA and the DDSs to successfully meet the challenges 
of the future workload is contingent on many features, some of 
which we have described in this testimony. This Committee has 
already heard from a variety of witnesses and will hear from 
others. NADE is very grateful for this opportunity to share 
some of our concerns. SSA's workloads are projected to increase 
and the Disability workload alone is expected to increase by 
47% over the next ten years. Because of the increasing 
complexity of the disability workload and the continuing 
changes that are made in the program itself, SSA and the DDSs 
must begin today to prepare for this tremendous challenge. If 
we are to begin, we must be allowed the tools and resources to 
do so.
    Mr. Chairman, Honorable Members of Congress, thank you for 
your consideration of these issues.
      

                                

    Chairman Shaw. Thank you.
    Mr. Hill?

 STATEMENT OF JAMES A. HILL, PRESIDENT, CHAPTER 224, NATIONAL 
    TREASURY EMPLOYEES UNION, AND STAFF ATTORNEY, OFFICE OF 
HEARINGS AND APPEALS, SOCIAL SECURITY ADMINISTRATION, CLEVELAND 
                         HEIGHTS, OHIO

    Mr. Hill. Good afternoon, Mr. Chairman. My name is James 
Hill. I have been a staff attorney at the Cleveland, Ohio, 
Office of Hearings and Appeals for over 17 years. For nearly 9 
1/2 years, I have also been the President of Chapter 224 of the 
National Treasury Employees Union that represents attorneys and 
other staff members in over 100 OHA offices across the United 
States. I thank you for inviting me to testify at this hearing.
    I will limit my testimony to the current situation at the 
Office of Hearings and Appeals. OHA is presently implementing 
the Hearings Process Improvement Initiative, or HPI, as it is 
commonly known. As you know, SSA has experienced significant 
difficulties maintaining an acceptable level of service at the 
hearing level since the large influx of disability cases in the 
early and middle-1990s.
    SSA was painfully slow in reacting, which caused a 
precipitous increase in the number of cases pending--the 
disability backlog--and a substantial increase in processing 
time. SSA's response was the Disability Process Redesign, a 
program conceived and implemented by SSA rather than OHA that 
has failed to have any significant beneficial impact upon 
productivity or the level of service provided by OHA.
    Its centerpiece for the hearings portion of the plan, the 
adjudication officer, was a dismal failure, and it was 
eventually abandoned. It failed because of unreasonable 
expectations that were impossible to meet and fundamental 
misconceptions regarding the hearing process that are endemic 
at SSA. I fear the same fate will befall HPI for much the same 
reasons. For example, HPI has incorporated nearly all of the 
attributes of the failed adjudication officer program, except 
the most beneficial attribute, limited decisional authority.
    While the Disability Process Redesign did little to ease 
the situation at OHA, the short-term disability program was a 
resounding success. Commissioner Apfel stated in his testimony 
before this subcommittee on October 21, 1999, and I quote, 
``During the past few years, SSA undertook a number of 
initiatives to address large hearing workloads that have 
produced real results. Initiatives such as the establishment of 
case-screening units and specialized writing units helped to 
decrease average processing time at the hearing level from 386 
days in 1997 to, under a preliminary analysis, 316 days at the 
close of fiscal year 1999,'' end of quote.
    What the Commissioner did not state was that the backlog at 
OHA had decreased from around 570,000 cases to approximately 
310,000 cases. The unquestioned centerpiece of the short-term 
disability program was not the screening units or the writing 
units mentioned by the Commissioner. It was the Senior Attorney 
Program that has produced over 200,000 decisions.
    Given the amount that the backlog at OHA has been reduced, 
it should be difficult to understate the importance of the 
contributions made by senior attorneys. Yet, the Commissioner 
in his testimony managed to do exactly that. The screening 
units were never particularly effective. The writing units were 
useful in drafting ALJ decisions, but it should be understood 
that senior attorney decisions are in addition to the decisions 
issued by administrative law judges.
    Yet, the Commissioner in his testimony did not mention the 
most successful disability initiatives in many, many years. 
Why? Because the Senior Attorney Program, or at least the 
decisional authority at the heart of that program, is not part 
of HPI. Why? That is an intriguing subject which time 
constraints preclude discussing. Suffice it to say that 
concerns other than maximizing the level of service provided to 
the public continue to play a significant role in determining 
SSA's strategy for the future. HPI will not be successful 
because not only has SSA failed to learn from its failures, it 
has failed to learn from its successes.
    Thank you.
    [The prepared statement follows:]

Statement of James A. Hill, President, Chapter 224, National Treasury 
Employees Union, and Staff Attorney, Office of Hearings and Appeals, 
Social Security Administration, Cleveland Heights, Ohio

    Chairman Shaw and Members of the Subcommittee:
    My name is James A. Hill. I have been employed by the 
Office of Hearings and Appeals (OHA) of the Social Security 
Administration (SSA) for more than 17 years as a Staff Attorney 
and as a Senior Attorney. I am also the President of National 
Treasury Employees Union (NTEU) Chapter 224 that represents 
Attorney-Advisors and other staff members in approximately 100 
Hearing Offices across the United States. I wish to thank the 
Subcommittee for inviting me to testify regarding SSA's current 
and future service challenges and the current and proposed 
delivery practices with which SSA hopes to meet those 
challenges.
    The ``demographics'' with which SSA must contend both in 
the immediate and in the more distant future are well known and 
need little amplification by NTEU. Suffice it to say that 
workload demands will significantly increase, and that during 
the same period, SSA will lose an unprecedented number of its 
employees to retirement. Thus SSA will be faced with an 
increased workload and far fewer experienced employees to deal 
with that workload. Additionally, SSA must contend with the 
issues of the Medicare Program, SSA retirement trust fund 
solvency, and maintenance of the faith and trust of the 
American people in our ability to provide the same level of 
service provided to previous generations. These issues are 
beyond SSA's ability to solve by itself; indeed they are among 
the most important political issues of our time. Nonetheless, 
it is the responsibility of SSA to maintain the level of 
service expected by the American people while the broad ranging 
political issues are resolved and the role of SSA in the future 
is finalized. Consequently, for the most part I will limit my 
testimony to the service provided currently and in the 
immediate future by the Office of Hearings and Appeals.
    NTEU makes the following recommendations for insuring that 
the Office of Hearings and Appeals delivers the quality of 
service demanded by the American people currently and in the 
immediate future:
    1. SSA must reaffirm its commitment to the judicial process 
at OHA and the decisional independence of its adjudicators. SSA 
must recognize that maintaining the due process hearing 
procedures is essential to retaining the faith of the American 
public in the SSA disability adjudication system.
    2. Attempts to de-legalize the OHA process must stop and it 
must be recognized that the maintenance of a credible 
disability adjudication system demands retention of highly 
qualified legal professionals--administrative law judges, 
attorneys and qualified and properly trained and certified 
paralegals.
    3. SSA must remove the composing of ALJ decisions from the 
responsibilities of employees in the Flexible Disability Units.
    4. All experienced OHA Attorney Advisors should be Senior 
Attorneys and given the authority to issue fully favorable 
decisions in those cases in which the documentary evidence 
demonstrates that the claimant is disabled.
    5. Reinstate the original Senior Attorney Program with 
decisional authority vested in the nearly 500 experienced OHA 
Staff Attorneys. (Without the additional 50,000-75,000 
decisions a year, OHA, even with Hearing Process Improvement 
(HPI), will suffer a serious degradation in the quality of 
service it provides).
    6. Retain the Supervisory Attorney Advisor whose primary 
duty is the supervision of all the subordinate attorneys in the 
Hearing Office.
    7. Recognize that the ALJ decision is a legal work product 
requiring the skills of qualified legal professionals such as 
administrative law judges, attorneys and paralegals with proper 
legal training.
    8. Re-establish OHA Central Office in operational control 
of HPI and hearing offices.
    9. Ensure the existence of a viable ``National Workflow 
Model'' that takes advantage of the talents and abilities of 
hearing office staff.

The Importance of the Office of Hearings and Appeals

    Americans have been characterized as overly litigious. 
Perhaps, but by their very nature Americans do believe ``in 
standing up'' for their rights even, or perhaps especially, 
against intrusion of their rights by the government. We believe 
that we can stand against the government, and if we are right, 
we shall prevail. We have traditionally regarded the court 
system as the vehicle for protecting our rights, particularly 
when it is the government itself that is threatening them. In 
short, when we feel unjustly tread upon by the government, we 
Americans demand our ``day in court.'' Claimants, who are 
denied disability benefits, feel the government has wronged 
them. There are far too many denials of disability claims to 
initially process through the federal court system. It is OHA 
that provides dissatisfied SSA claimants with their ``day in 
court.'' However, to effectively fulfill this function, 
claimants must believe that the ALJs in OHA are free to decide 
each case on its merits. It is the right to a due process 
hearing that provides the vehicle for fair and independent 
decision making. That right must not be eroded by those seeking 
administrative efficiency. It is OHA that provides the element 
of credibility in the SSA adjudication process that is 
essential if it is to retain the faith and trust of the people 
we serve. The role of OHA as guarantor of the legal rights of 
claimants is not universally appreciated at SSA. Unfortunately, 
SSA's leadership has made several efforts in the past decade to 
de-legalize the OHA appeals process without regard to the 
effect that de-legalization would have on the credibility of 
the SSA disability adjudication process.
    The Social Security disability adjudication system is 
bifurcated; the State Agencies are responsible for the initial 
(and reconsideration) determination, while Senior Attorney and 
ALJ decisions are made at the Office of Hearings and Appeals. 
There are good reasons for the bifurcated system; the huge 
number of initial claims, of which 35% are favorably decided, 
render the use of a judicial system with individual hearings 
unsupportable. The initial determination process is a purely 
administrative process conducted with minimal participation by 
the claimant. The State Agencies have traditionally avoided the 
knotty problem of evaluating credibility of the claimant's 
subjective complaints and the effect to which those symptoms 
limit a person's ability to work. The State Agencies 
concentrate on the objective medical evidence and issue only 
superficial explanations of their disability determinations.
    The determinations issued by the State Agencies are nearly 
devoid of rationale. While SSA promised better State Agency 
rationales as part of Disability Process Redesign (DPR), my 
members note no significant improvement. State Agency 
rationales under HPI are as devoid of content as their 
predecessors under the old system. The determination by the 
State Agency consists of readily identifiable boilerplate that 
is obviously sent to every applicant whether it is applicable 
to his/her situation or not. For example, language included in 
many Step 5 denial determinations admits, ``We realize that 
your condition prevents you from doing your past jobs, if any, 
but it does not prevent you from doing other work which is 
considered less demanding.'' The text of the determination 
demonstrates to claimants that little, if any, individual 
consideration was afforded to their case. Claimants are left 
with the conclusion that they are so insignificant that they do 
not deserve individual consideration.
    The failure to provide an adequate explanation of why a 
person was determined not to be disabled at the initial level, 
tells the claimant: You are not disabled because we say you are 
not disabled. This attitude is not likely to be satisfying to 
claimants or to convince them that they have had a fair 
determination of their disability application. At the initial 
level, the fact that the individual is not disabled, rather 
than the explanation of why he/she is not disabled, is the 
salient point. It is also consistent with the highly 
paternalistic view of the disability process held by many in 
SSA. A detailed explanation is not considered by SSA to be 
significant because it will not change the fact that the person 
is not disabled. The lack of concern about explaining the 
decision makes some administrative sense. That determination is 
not subject to appellate review; subsequent review by OHA is de 
novo. However, the attitude that the rationale is relatively 
unimportant leads to disastrous conclusions when applied to the 
OHA decision makers.
    The process at OHA is judicial in nature and is focused 
around the due process hearing. The due process, individualized 
hearing is essential to the fact and perception of fair 
adjudication in any case in which the decision is not fully 
favorable to the claimant. The OHA hearing procedure permits 
the dissatisfied claimant to personally interact, to personally 
argue his/her position directly to the decision maker. The 
decision he/she receives is comprehensive and specific; it 
deals with his/her situation in great detail. A well-written 
OHA decision will provide specific reasons and details as to 
why an individual was determined not to be disabled. It must be 
specific and compelling. Indeed, the OHA decision must be of 
sufficient quality to routinely withstand review by United 
States District and Circuit Courts and therefore the decision 
needs to be the product of legally trained employees. The OHA 
decision must satisfy the claimant's need to ``have his/her day 
in court'' and the need of the court system to have detailed 
and highly professional decisions upon which they can base 
their appellate review. Inadequate, not necessarily wrong, 
decisions are the basis for some of the remands from the 
District Court. The lack of a well written favorable decision 
significantly detracts and in fact may preclude conducting an 
effective Continuing Disability Review permitting those no 
longer disabled to remain on the rolls. No one is well served 
by an inadequate OHA decision.
    The OHA decisional product is subject to court review where 
the standard applied is whether the decision is supported by 
substantial evidence. The rationale supplied by the decision 
maker at OHA will be carefully examined by the court as an 
integral part of its decision making process. To the court the 
explanation is as important as, and cannot be separated from, 
the ultimate decision regarding disability. While the ultimate 
decision of whether he/she is disabled is of primary importance 
to the claimant, a coherent explanation of a negative 
conclusion certainly provides the claimant with the feeling 
that at least he/she has had his/her day in court.
    Many in SSA improperly equate the ALJ and Senior Attorney 
decision with the determination rendered by the State Agency. 
This attitude leads to devaluing the importance of the ALJ and 
Senior Attorney decision and therefore the necessity of 
retaining highly qualified legal professionals to create those 
decisions. The denigration of the ALJ or Senior Attorney 
decisional product, resulting from the failure to appreciate 
its purpose and importance, is central to the long term theme 
of de-legalizing OHA which appears in nearly every SSA 
originated plan to deal with hearings level adjudications.
    If as in the case of the State Agency determinations, the 
quality of the written decisional product is not important, 
there is little need to maintain a cadre of highly trained 
legal professionals; on the other hand given the purpose and 
importance of the OHA decision, retention of attorneys in the 
process is of paramount importance. As noted by Administrative 
Law Judge Kathleen McGraw, Chair, Social Security Section of 
the Federal Bar Association in her testimony before the 
Subcommittee on Social Security and the Subcommittee on Human 
Resources on October 21, 1999, it has been SSA's inclination to 
de-legalize the hearings process. She stated, ``It (ALJ 
decision) needs to be the product of legally trained 
employees.'' She further noted, ``The work of the Office of 
Hearings and Appeals is judicial in nature. It requires the 
input of attorneys. While there is a legitimate place for 
paralegals in the process, the trend seems to be to supplant 
the attorneys with paralegals.'' Judge McGraw continued, ``The 
title ``paralegal'' has been given to a job that for the most 
part is held by employees who have been promoted from clerk-
typist, to clerk, to legal assistant to paralegal. These 
employees have no legal training and are in no better position 
to analyze evidence and write legal decisions containing 
credibility assessments than the examiners in the State 
Agencies.'' NTEU fully concurs.
    Another attempt to de-legalize the OHA procedure involves 
the use of Flexible Disability Units to draft ALJ decisions. 
Seven Flexible Disability Units have recently been established 
in Operations that are responsible for providing support as 
needed for the State Agencies, the SSA Field Offices, and the 
OHA Hearing Offices. The grade controlling activity of the 
employees assigned to these units is composing ALJ decisions. 
Operations controls the initial phase of the disability 
adjudication. Permitting it to be involved in the hearings 
portion of the proceedings gives at least the appearance of 
impropriety. These individuals, much like those SSA calls 
paralegals, do not have the legal training necessary to 
properly compose ALJ decisions. Experience has demonstrated 
that many decisions written under similar conditions require 
significant revision by Staff Attorneys or Administrative Law 
Judges in hearing offices resulting in a significant loss of 
productivity. Additionally, these writers will have no contact 
with the ALJs for whom they write and given the part time basis 
of their decision drafting duties, they are not likely to 
establish a rapport with the ALJ that significantly contributes 
to a good decisional product.
    NTEU recommends that:
    1. SSA reaffirms its commitment to the judicial process at 
OHA and the decisional independence of its adjudicators. SSA 
must recognize that maintaining the due process hearing 
procedures is essential to retaining the faith of the American 
public in the SSA disability adjudication system.
    2. Attempts to de-legalize the OHA process must stop and it 
must be recognized that the maintenance of a credible 
disability adjudication system demands retention of highly 
qualified legal professionals--administrative law judges, 
attorneys and qualified and properly trained and certified 
paralegals.
    3. SSA must remove the composing of ALJ decisions from the 
responsibilities of employees in the Flexible Disability Units.

A Short History Lesson on How Not to Improve the System

    As the administrative procedures are appropriate for the 
initial determination, the judicial procedures with the 
emphasis on the due process hearing are appropriate at the 
hearings level. Recognition and acceptance of the fundamental 
differences between the administrative and judicial processes 
is essential to understanding and appreciating the value of the 
entire process. Unfortunately, there are many in SSA who do not 
appear to understand or appreciate the significance and 
importance of the judicial nature of the hearings portion of 
the process. SSA, through the efforts of the Disability Quality 
Branch, exercises considerable control over the decision making 
process at the State Agency level; a level of control not 
present at the OHA level. Many in SSA see this lack of control 
over OHA decision making as a major weakness. They believe that 
if SSA could control the decision making of the ALJs, they 
could better control the workload at OHA leading to a more 
efficient processing of cases. It is the apparent goal of many 
in SSA to de-legalize the hearing process. This has led to a 
number of SSA conceived schemes to ``improve OHA'' by 
denigrating the legal and professional character of the OHA 
work product and work force. SSA took advantage of a crisis 
that its inaction created or at least exacerbated to levy its 
most serious attack on the due process hearing.
    In the early 1990's SSA experienced a significant increase 
in disability receipts, for which SSA was not properly prepared 
and to which SSA did not timely respond, leading to a 
disastrous increase in the number of cases pending, the 
``dreaded disability backlog.'' While both the initial and 
appellate workloads increased dramatically, the administrative 
actions that permitted increased production at the initial 
level were entirely inappropriate to the due process hearings 
required at the Office of Hearings and Appeals. By the time SSA 
decided to respond, the situation was entirely out of control 
with the OHA backlog increasing by as many as 10,000 cases a 
month and with processing times at the OHA level reaching 
unconscionable levels.
    SSA responded by hiring significant numbers of new 
Administrative Law Judges (ALJs) and support staff. 
Subsequently, additional ALJs were hired to adjudicate 
temporary workloads imposed by changes in the law involving 
Child's Supplemental Security Income (Disability) and Drug and 
Alcohol Abuse cases. However, the ``learning curve'' guaranteed 
that little additional ALJ production was realized for the next 
several years. Finally, by late 1993 SSA realized the magnitude 
of the disaster caused by its inaction, and began to 
investigate potential alterations in the process that would 
facilitate increased productivity. Unfortunately, the 
individuals charged with the task of dealing with the 
disability backlog used the opportunity to forward their 
philosophical agenda to de-legalize the Office of Hearings and 
Appeals. This investigation culminated in the formulation of 
the Disability Process Redesign (DPR).
    The DPR was a massive and expensive program designed to 
fundamentally change the Social Security Disability 
adjudication process. It was an enterprise involving the 
expenditure of millions of dollars in its formulation and 
execution. A significant bureaucracy was established to 
administer the program, often drawing some of SSA's most 
talented employees from their usual roles thereby imposing 
considerable hardship upon the component from which they came. 
Unfortunately, the DPR was fundamentally flawed from the 
outset. The basic underlying premise of DPR was that claimants 
would not avail themselves of the entire appeals process 
because those not found to be disabled at the initial stage, 
would be so impressed with the quality and timeliness of the 
process that they would recognize they were not disabled and 
accept the initial determination. This ignored the fact that 
most people applying for disability benefits really believe 
they are disabled and cannot work. They are not working; 
whether or not they receive benefits will be a major and 
perhaps the major determinate in their quality of life. They 
either need a job or these benefits to survive, and most 
believe that they cannot work. The SSA disability process is 
extremely user friendly; pursuing a claim through the Appeals 
Council level is by design a process that does not intimidate 
the average citizen. Consequently, they will pursue their 
claim.
    Additionally, the scope of the project was so large and so 
poorly planned and executed that Cynthia M. Fagnoni, Director 
Education, Workforce, and Income Security Issues Health, 
Education, and Human Resources Division of the General 
Accounting Office testified before the Subcommittees on Social 
Security and Human Resources on October 21, 1999 that ``The 
agency's first ambitious redesign plan in 1994 yielded little. 
When the agency scaled back its plan in 1997, progress was 
slow, in part because even the scaled-back plan proved to be 
too large to be kept on track.'' GAO was being overly kind, the 
Disability Process Redesign has been a magnificent and 
expensive failure. NTEU fears that the Hearings Process 
Improvement Initiative will meet a similar fate.

The Senior Attorney Program

    In stark comparison to the massive and expensive Disability 
Process Redesign and the Hearings Process Improvement 
initiatives, stands the Senior Attorney Program. The Senior 
Attorney Program was the centerpiece of the Short Term 
Disability Program (STDP). STDP was conceived by a small inter-
component workgroup in 1994, at the height of the disability 
backlog problem of OHA. It was designed to directly and in real 
time attack the backlog problem at OHA with a minimum 
expenditure of resources and with minimal organizational 
changes. The Senior Attorney Program as originally operated, 
involved approximately 475 of OHA's experienced Staff Attorneys 
who in addition to drafting ALJ decisions, would now review 
receipts before the receipts were assigned to an ALJ to 
determine whether the case could be paid on the record or 
whether an ALJ hearing was necessary to fully adjudicate the 
case. If the evidence indicated that the case was likely to 
result in a finding of disability, the Senior Attorney would 
complete development of the case, including securing additional 
medical evidence and appropriate medical and vocational 
expertise. If after such development the case was not likely to 
be favorably decided without a hearing, the case was forwarded 
to an ALJ for a hearing. However, if the record established 
that the claimant was in fact disabled, the Senior Attorney 
would draft and issue under his/her authority a fully favorable 
decision. The average processing time for Senior Attorney 
decisions was just over 100 days. This was at a time when 
processing time at the OHA hearing level was 386 days--more 
than 1 whole year.
     As a result of the Senior Attorney Program, disabled 
claimants received their benefits nearly 9 months earlier than 
otherwise would have been the case.
    From its inception until the Program was sharply curtailed 
in 1999, the Senior Attorney Program resulted in approximately 
50,000 fully favorable decisions per year. The level of success 
is particularly significant in the face of the opposition and 
obstructionism of many Hearing Office Chief Administrative Law 
Judges who used their managerial authority to diminish the 
scope and effectiveness of the program in their Hearing 
Offices. None of these cases required the expenditure of time 
and effort of ALJs, permitting them to concentrate on those 
cases requiring a hearing. Approximately 250,000 Senior 
Attorney Decisions have been issued since its inception. During 
its pendancy the OHA backlog has fallen from approximately 
570,000 to as low as 310,000. The correlation is obvious. 
Additionally, it should be noted that during this time period 
there was also a significant increase in ALJ productivity.
    There are a number of reasons that the Senior Attorney 
Program has been so successful at improving the level of 
service to the public. Some cases that come to OHA were 
improperly decided by the State Agency; many more were not 
fully developed. Senior Attorneys have been very successful in 
developing cases because oft-times it is the claimant's 
attorney representative who performs the actual development. 
These representatives quickly realized that when they were 
contacted by a Senior Attorney for additional evidence, there 
was a good likelihood that a favorable decision would be 
forthcoming. This likelihood of a favorable decision is a 
powerful incentive for that attorney to quickly secure and 
forward the necessary medical and other evidence. Of course the 
success of the Senior Attorney Program, like the success of the 
ALJ due process hearings, ultimately rests on the competence of 
the highly trained legal professionals who serve as 
adjudicators. These individuals are experienced OHA Staff 
Attorneys who have many years experience advising ALJs and 
composing ALJ decisions. They are attorneys well versed in the 
law, and they are experienced disability practitioners. Over 
the past 5 years they have proven by their performance that 
pre-ALJ decision making in the OHA hearing office significantly 
improves the quality of service provided to the public.
    In every respect the Senior Attorney Program has been a 
resounding success. It materially improved the quality of 
service provided to the public, especially those individuals 
who are disabled and entitled to timely granting of their 
benefits. Despite its success, the Senior Attorney as an 
independent adjudicator is being eliminated as part of the HPI 
Plan. The Senior Attorney Program has always been 
controversial. It has been bitterly opposed by a variety of 
factions within SSA. Some of the opposition has been driven by 
the ``turf wars'' that are endemic in SSA; some by the 
previously discussed antipathy for legal practitioners and the 
legal process. Service to the public has been of little 
concern; but that is often the case in SSA when the disability 
process is at issue. The tragedy is that the Senior Attorney 
Program is ideally suited for incorporation into the HPI 
Process.
    Indeed, under HPI a new permanent position called the 
Senior Attorney Advisor has been created whose prime 
responsibility is to review cases for possible on the record 
decisions. However, unlike the current program, HPI requires 
that the case be forwarded to an ALJ who will determine if an 
on-the-record decision is justified; the case would then be 
returned to the Senior Attorney for drafting; then returned to 
the ALJ for review and hopefully signing. This involves many 
more hand-offs and requires that an ALJ spend considerable time 
reviewing a case (duplicating the effort of the Senior 
Attorney) that in all likelihood will result in a favorable 
decision. This reduces the number of other cases an ALJ can 
adjudicate. This is not an administratively efficient process, 
but worse, it significantly degrades the level of service 
provided to the public. Retaining the decisional authority of 
the Senior Attorney would provide the HPI process with a tested 
mechanism for efficiently dealing with claimants who are 
entitled to disability benefits at virtually no additional 
cost.
NTEU recommends that:

    All experienced OHA Attorney Advisors should be Senior 
Attorneys and given the authority to issue fully favorable 
decisions in those cases in which the documentary evidence 
demonstrates that the claimant is disabled.

Hearings Process Improvement Plan

    NTEU is profoundly skeptical that the Hearings Process 
Improvement Plan will materially improve disability 
adjudication at the hearings level. The failure to retain the 
decisional authority of Senior Attorneys dooms HPI to failure. 
Additionally, the creation of non-attorney supervisors to 
supervise the work of attorneys raises operational and ethical 
problems. The Canons of Ethics applicable to nearly all 
licensed attorneys place severe constraints on the supervision 
of an attorney's work product and evaluation of that product. 
Operationally, the creation of non-attorney supervisors has 
resulted in supervisory personnel who have no experience in 
decision drafting supervising many individuals with years of 
experience in drafting. It simply does not make sense.
    This plan, much like the Disability Process Redesign, is 
primarily the product of SSA rather than a product of OHA. 
While widely touted as an OHA plan, most of the individuals 
charged with its creation did not work at OHA. Many of the 
fundamental misconceptions about the hearings process that 
doomed DPR are retained in HPI. That is not a comforting 
thought. HPI like DPR has been administered from Baltimore 
rather than Falls Church where OHA is located. While this made 
sense for DPR that dealt with the entire disability process, it 
makes little sense for HPI which deals specifically with OHA's 
hearing offices. More disturbing, despite the already proven 
inability of Baltimore to manage hearings level adjudication, 
OHA's national management appears to have a significantly 
diminished role in creating and implementing HPI. The 
individuals in OHA chiefly responsible for implementing HPI are 
its Regional Chief Administrative Law Judges and an ad hoc 
organization known as the Process Action Team. While NTEU 
recognizes the knowledge, level of commitment, and dedication 
of the Regional Chief Administrative Law Judges, it questions 
whether their traditional responsibilities and lack of adequate 
staff (the very capable regional office staff personnel cannot 
have much time from their usual duties to support HPI 
activities) permit the level of concentration and attention to 
detail necessary to coordinate and administer such an ambitious 
project.
    Additionally, NTEU questions whether such an arrangement 
can result in the level of uniformity between the Regions that 
is advisable and necessary in administering a national program. 
Much is being made of the HPI promise to implement a ``National 
Workflow Model'' standardizing hearing office procedures and 
taking advantage of previously identified best practices. 
Removing central office direction from implementation and 
management of HPI seems an odd way to achieve national 
uniformity. However, the practice of permitting numerous 
``local options'' has already allowed each Hearing Office Chief 
Administrative Law Judge (HOCALJ) to craft a process 
inexplicably different from the model. In some offices the 
HOCALJs have simply told their staff that only position titles 
have (or will) change; the hearing office will operate as it 
has before. There is no measure of uniformity of process.
    One of the persistent complaints about the current Hearing 
Office process is the lack of accountability by one individual 
for the processing of a case. HPI touts the concept of team 
accountability as the panacea for that problem. There are no 
teams, only groups. Team accountability without teams (and 
perhaps with teams) means no one individual is accountable. 
This lack of accountability by individuals for the work product 
will eventually result in a further degradation of service.
    It should also be recognized that HPI has had little 
success in convincing hearing office staff, ALJs, and any of 
the stakeholders that it can succeed. This lack of commitment, 
combined with the lack of confidence and poor morale caused by 
the fear and uncertainty about the future is not conducive to 
bold advances in productivity.
    HPI is not likely to be the unmitigated disaster that was 
DPR, but that is not a very high standard. Nonetheless, HPI 
does hold some promise for a more efficient process within the 
confines of the due process hearing model. To realize this 
promise SSA must:
    1. Reinstate the original Senior Attorney Program with 
decisional authority vested in the nearly 500 experienced OHA 
Staff Attorneys. (Without the additional 50,000-75,000 
decisions a year, OHA, even with HPI, will suffer a serious 
degradation in the quality of service it provides).
    2. Retain the Supervisory Attorney Advisor whose primary 
duty is the supervision of all the subordinate attorneys in the 
Hearing Office.
    3. Cease and desist its attempts to de-legalize OHA.
    4. Recognize that the ALJ decision is a legal work product 
requiring the skills of qualified legal professionals such as 
administrative law judges, attorneys and paralegals with proper 
legal training.
    5. Eliminate decision drafting responsibility in the 
Flexible Disability Units.
    6. Re-establish OHA Central Office in operational control 
of HPI and hearing office operations.
    7. Ensure the existence of a viable ``National Workflow 
Model'' that takes advantage of the talents and abilities of 
hearing office staff.
      

                                

    Chairman Shaw. Thank you.
    Mr. Korn?

STATEMENT OF STEVE KORN, PRESIDENT, NATIONAL COUNCIL OF SOCIAL 
  SECURITY MANAGEMENT ASSOCIATIONS, INC., VALLEJO, CALIFORNIA

    Mr. Korn. Chairman Shaw and members of the subcommittee, my 
name is Steve Korn and I am here as President of the National 
Association of Social Security Management Associations. I thank 
you very much for giving me the opportunity to come before you 
today to talk about SSA's readiness to meet current and future 
service delivery challenges from the perspective of the front-
line managers and supervisors who are directly responsible for 
delivering service to the American public.
    The Social Security program has always had a special 
relationship with the American people. Perhaps no other Federal 
program has been more successful at achieving its vision, that 
of ensuring Americans a reliable and compassionate place to 
turn for help when facing major life challenges such as 
retirement, disability, or the death of a loved one. I have 
been proud of this agency in my 24 years of service, not only 
because of the importance of the programs we administer, but 
also because of the caring and professional manner in which we 
deliver our services. I firmly believe that this commitment to 
service is greatly responsible for the overwhelming support 
enjoyed by the Social Security program in this country.
    Last month, this committee heard from Stanford Ross, 
Chairman of the Social Security Advisory Board, about their 
recent report on how the Social Security Administration can 
improve its services to the public. Recently, a field office 
manager with over 39 years of experience called me simply to 
say that he believed that this report was the most accurate, 
honest, and inspiring analysis of the Social Security 
Administration he has seen in his entire career. And I have to 
tell you that the vast majority of managers and supervisors 
that I represent share that viewpoint.
    The Advisory Board made an array of recommendations on how 
Social Security could improve its services, from development of 
a service delivery plan, to improvements in the agency's 
service delivery practices, to addressing longstanding 
institutional problems. Yet, despite the best efforts of our 
executive leadership, many of the most pressing problems simply 
cannot be addressed within the current resource constraints 
facing the agency.
    Most of the problems identified by the Advisory Board did 
not appear overnight. Commissioner Apfel earlier testified that 
the agency staff has been cut 22 percent since 1985. This hit 
was particularly hard on our field offices, and, in fact, 
whereas in the early 1980s only 16 percent of our field offices 
had 15 or fewer employees, today 40 percent have 15 or fewer 
employees.
    A look at one of our field offices in the Dallas area 
illustrates the difficulties we face. Despite an increasing 
workload, the staff of this office declined nearly 50 percent 
since 1982. The influx of immigrants in the area requires that 
the staff speak at least seven languages. So many people come 
to their office each day that on a recent morning, an early-
morning visitor thought there was a fire drill in progress 
because of the size of the crowd that had gathered outside.
    Constraints on agency staffing levels, coupled with severe 
reductions in field office supervisory staff since 1993, are 
leading to severe pressures to close field offices. In my area 
of the country, many managers have opted to close an office 
simply because the size of the staff has declined to the point 
where it is too difficult to manage.
    Unfortunately, pressures on the agency to maintain service 
levels will only get worse in the future. First, the aging of 
the baby boom generation will cause SSA workloads to explode. 
The number of Social Security beneficiaries is expected to grow 
55 percent between now and 2020, and disability beneficiaries 
alone will grow by 47 percent just in the next 10 years.
    Second, SSA is facing an unprecedented wave of retirements 
from its experienced workforce during the same 10-year period. 
Because of the complexity of our programs, it generally takes 
new front-line employees 3 years to learn their jobs. 
Experienced employees are needed to teach these new employees 
the job and to maintain productivity while they are learning.
    I am very pleased that Commissioner Apfel has recognized 
these trends. He has submitted his own independent budget 
request for $222 million more than is contained in the 
President's fiscal year 2001 budget request, and this 
additional money will allow SSA to begin to add the staff 
necessary to deal with the retirement wave as well as the 
increasing demand for our services by the aging baby boomers.
    Finally, both Commissioner Apfel and the Advisory Board 
have gone on record as supporting the need to remove SSA's 
administrative budget from discretionary spending caps. We 
believe this is essential to our ability to adequately serve 
the baby boom generation in the future. This was aptly 
demonstrated in the fiscal year 2000 appropriation process that 
saw Social Security take a $130 million cut from the bare-bones 
present budget simply due to spending cap constraints. Among 
other things, this has forced SSA to reduce the level of 
service to those calling our 800 number.
    I strongly urge that this committee express support to the 
Appropriations Committee for the Commissioner's budget, as well 
as support for the removal of the agency's administrative 
budget from spending caps.
    Mr. Chairman and members of the subcommittee, thank you 
again for this opportunity to appear before you and I would be 
happy to answer any of your questions.
    [The prepared statement follows:]

Statement of Steve Korn, President, National Council of Social Security 
Management Associations, Inc., Vallejo, California

    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 for 24 years. On behalf of our membership, I am 
very honored that the NCSSMA was selected to testify at this 
hearing on the SSA's readiness for the impending wave of Baby 
Boomer beneficiaries.
    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 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.
    The Social Security managers take great pride in their 
work. We were pleased to learn recently that, once again, the 
SSA was one of only two government agencies to receive an 
overall agency grade of ``A'' from the Government Performance 
Project which is administered by Syracuse University. But as 
proud as we are of our record, I must acknowledge, Mr. Chairman 
that each year becomes increasingly challenging to maintain 
this tradition of excellence.
    The managers and supervisors of the SSA field offices and 
teleservice centers are grateful that this Subcommittee--as 
demonstrated by this hearing--recognizes the seriousness of the 
impact that the retirement of the Baby Boom generation will 
have on the operations of the agency. While there are many 
facets of the SSA's services that I could discuss today that 
will be affected by the impending wave of beneficiaries, they 
all point back to one specific concern, which is the need not 
only for additional staff resources, but staff who will have 
the appropriate experience to effectively deliver the services 
of the SSA.
    Last fall, the Social Security Advisory Board issued a 
report on ``How the Social Security Administration Can Improve 
Its Service to the Public.'' The Board found that staff 
resources in offices all over the country have declined to the 
point where their ability to provide quality service to the 
community is threatened. The managers and supervisors who I 
represent have characterized this Report as the most accurate, 
honest, and inspiring analysis of the Social Security 
Administration that they have witnessed in their entire careers 
with the SSA. After feeling that there was not a comprehensive 
understanding of the administrative needs and concerns of those 
on the front lines of the SSA, we now have a thorough, 
objective review of those needs and concerns by a 
Congressionally-mandated bi-partisan entity.
    The Advisory Board report made several recommendations that 
I would like to highlight for the Subcommittee. First, that the 
SSA urgently needs to develop a service delivery plan that 
describes how it will deliver service over the short term and 
the long term; second, that the SSA should work to ensure that 
it will have the human resources it needs to carry out its 
plan; third, that major improvements need to be made in a 
number of the agency's service delivery practices and strategy; 
and fourth, that the agency address longstanding institutional 
problems. We agree with the Report's findings and applaud its 
recommendations.
    I would wager that if Members of this Subcommittee called a 
Social Security office in their District -and I would urge each 
of you to do so--you would find their responses reflected in 
the Advisory Board's Report. The concerns focus on the 
resources of the SSA, or lack thereof, to serve the increasing 
numbers of the public in need of assistance. The field offices 
not only serve those seeking retirement benefits, but also 
those receiving Medicare; Disability; Survivors; SSI for the 
blind, aged and disabled; and information and referral 
activities to other state, federal and local benefit programs. 
In addition, our field offices will soon serve new clients as a 
result of the ``Ticket to Work Act'' who will require even more 
coordinated and hands-on services not only in the offices, but 
in coordination with other community-based vocational 
rehabilitation providers. To put the situation into context, 
this growth in responsibility has been occurring at the same 
time that staff and management in the field offices has 
declined by more than 30 percent.
    What does this decline in resources mean in real life 
situations? I would like to provide you with a few 
illustrations of what our members face when they go to their 
offices each day. The Waukegan, Illinois office, which is a 
growing service area with increasing new claims receipts office 
had a staff of 45 twenty years ago and today it has 31. The 
situation has become so extreme that the office has to ship 
work to other locations for completion. About six years ago, 
Waukegan began to lose experienced staff to retirement, which 
is a precursor of what most offices will begin to experience in 
the next several years. Since that time Waukegan has trained 
and/or hired 13 individuals to fill these positions, ten of 
whom have already left the office. In the past, career 
employees dominated the SSA; today early and mid-career changes 
are commonplace. At least a dozen of the Waukegan trainees have 
already left due to job pressures, better jobs, better pay, and 
different career choices. And the issue is much more complex 
than a simple replacement, as it takes at least three years for 
a new employee to become fully trained.
    In one of our field offices in the Dallas area there has 
been nearly a 50% staff reduction since 1982 even though the 
workload has increased significantly. The influx of immigrants 
in the area now requires that the staff speak at least seven 
languages and last year the office processed over 83,000 Social 
Security card applications. The staff regularly visits refugee 
centers and homeless shelters due to transportation problems in 
the area and because their waiting room cannot accommodate the 
number of people they must serve on a daily basis. Last fall 
when a visitor arrived at the office early in the morning he 
thought there was a fire drill in process because of the crowd 
that had gathered outside.
    In Wausau, Wisconsin, one third of the staff will retire in 
the next five years and two-thirds will retire in the next ten 
years. The Field Representative in that particular office has 
an extraordinary outreach program to serve rural and isolated 
communities; he conducts retirement seminars at area companies 
and appears regularly on local radio and television stations to 
discuss Social Security programs. The Field Representatives 
play a vital role in their communities but they have become an 
endangered species -15 years ago nearly every one of the 1300 
field offices had at least one of these representatives; today 
only 25% of our offices have Field Representatives. When my 
colleague in Wausau retires within the next several years the 
SSA will likely lose a vital community connection forever.
    The Advisory Board Report also indicated that:
     Phone calls to field offices are often unanswered 
since there is not enough staff to serve the visiting public 
and also answer the phones;
     Post-eligibility benefit delays of 90 days or more 
have become commonplace as staff in the program service centers 
are diverted to answer calls to the SSA 800 number;
     Failure to fully document information needed to 
make more accurate disability determinations has become 
commonplace;
     Front-line employees cannot take the time to 
ensure that customers understand eligibility rules, their 
rights and responsibilities;
     Customers, especially in urban areas, must wait up 
to four hours to see a SSA official;
     Inadequate oversight of representative payees, 
such as people appointed to receive benefits for those not 
capable of managing their own.
    This situation did not occur overnight nor do we associate 
it with any particular administration, but it has been a 
continual challenge to maintain quality delivery services with 
a shrinking workforce. To exacerbate the situation, in 1993 the 
SSA, acting on a government-wide recommendation from the 
National Performance Review, set a goal of one manager for 
every fifteen staff by 1999. Although this goal was, perhaps, 
well-intentioned as a means to a less bureaucratic and more 
efficient workplace, its result for the field offices has had 
the opposite effect and speaks to the old adage that ``if it 
ain't broke, don't fix it.''
     In 1982 only about 16% of field offices had 15 or 
fewer employees compared to 40% today. About 15% of SSA's 1300 
field offices have ten or fewer employees while less than 3% 
were this small in 1982
     Because SSA field offices have never been 
integrated into SSA's 800 system, growing telephone workloads 
are handled by assigning fewer staff to field offices
    As America ages, Social Security workloads continue to 
grow. Soon there will be large increases in disability and 
retirement claims, which will occur at about the same time as 
the most experienced SSA employees will, themselves, reach 
retirement. We hear a great deal about the Social Security 
Trust Fund, but the unspoken crisis in the national debate is 
whether the SSA will be up to the task of meeting future public 
services needs.
    The downsizing and increased workload of the past 18 years 
have had a chilling effect on our ability to deliver services, 
but they will pale by comparison to the ``train wreck'' we see 
coming in the next ten years. A number of variables will 
contribute to this problem:
     First, SSA has an aging workforce, whose average 
age is almost 50. This situation is also a result of downsizing 
and restrictions on hiring in the 1980's and 1990's. Over the 
next decade they will begin to retire and must be replaced with 
less experienced employees. We anticipate annual losses of six 
to seven percent of experienced managers between 2004 and 2008, 
and five percent of experienced claims representatives between 
2006 and 2010. Focus groups with experienced employees indicate 
that job stress and work overload make it unlikely they would 
stay after they become eligible for retirement
     Second, between now and 2020, while the general 
population is expected to grow by about 16 percent, the number 
of Social Security beneficiaries is expected to grow by 55 
percent
     Third, even before the oldest of the baby boomers 
reach 65 in about 2011, the number of disability beneficiaries 
is expected to grow by 47%
     Fourth, the SSI program, which is even more 
complex and labor-intensive than Social Security, grew by 43% 
over the past ten years and is expected to climb
    This Subcommittee has very accurately identified what may 
be the ``sleeper'' issue of the national debate about Social 
Security--how the Baby Boomers will affect service delivery of 
the SSA. As I mentioned earlier, the key to the equation is 
adequate staff resources, which translates into adequate 
funding to support those staff needs. We at the SSA are 
fortunate that the law allows the Commissioner of the Social 
Security Administration to submit a budget request independent 
of the President's. For Fiscal Year 2001 the Commissioner 
recommended $7,356,000,000, which is $222 million more than the 
President's request and $784 million more than what was enacted 
in Fiscal Year 2000. While we are not aware of every detail of 
the Commissioner's request, we wholeheartedly endorse 
additional funding that would address the need for the SSA to 
increase staff resources in preparation for the wave of 
disabilities and retirements expected over the next ten years.
    To keep this funding in perspective, the administrative 
expenses to manage and administer the programs under Social 
Security--the Limitation on Administrative Expenses--represents 
only 2% of the overall Social Security Administration budget.
    One of the recommendations of the Social Security Advisory 
Board, which we strongly endorse, is to remove the LAE from the 
budget caps. As you are aware, the Social Security program, 
from which the LAE is funded, is a self-financed trust fund 
that is already off budget. While we understand that removing 
the LAE from the caps does not guarantee additional funds for 
staff in the field offices, it would at least provide Congress 
the flexibility to do so, rather than being held captive to 
predetermined budget constraints.
    One of the ways, particularly in the short term, the SSA 
can address its staff resource issues and at the same time 
continue to ensure an excellent work product is through the use 
of technology. In the last five years all SSA field offices 
have received new computers to help process work. Many tasks 
that previously required human intervention have now been 
automated which has helped increase quality and improve 
productivity. However, technology is in a constant state of 
change and the SSA struggles to keep current with its 
infrastructure. For example, when I was the manager of the 
Fairfield, California field office in 1993, we were one of the 
first offices to receive the new IWS-LAN workstations. Seven 
years later in 2000, some field offices have yet to receive 
this equipment. The Commissioner's budget requests $40 million 
for a capital investment fund, which is a mechanism that 
private industry successfully employs to stay current 
technologically. We strongly support the Commissioner's 
recommendation.
    We are appealing to the Appropriations Committee to 
consider the Commissioner's budget request as the baseline for 
its Fiscal Year 2001 appropriation for SSA's administrative 
expenses. We are requesting that this Subcommittee also express 
support to the Appropriations Committee for the Commissioner's 
budget as well as support for the removal of the agency's 
administrative budget from the budget caps.
    Mr. Chairman, to a great extent, the managers and field 
offices of the SSA are the face of government to millions of 
Americans. Of all Federal employees, we are the ones who most 
often interact directly with the public. We take this 
responsibility very seriously. We do our best to reach out to 
our communities and to provide them with the information and 
guidance they expect of their government. But, in order to do 
our jobs in the professional manner that the public has 
rightfully come to expect, we need to ensure that we have the 
necessary staff resources in the SSA field offices. We look to 
your Subcommittee to help us meet that objective.
    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.
      

                                

    Chairman Shaw. Thank you.
    Mr. Matsui?
    Mr. Matsui. Thank you, Mr. Chairman. Mr. Chairman, I want 
to thank you very much for calling these hearings, the one a 
few weeks ago and this one today. I think it is very timely, 
and obviously one that we have to really begin to focus on, 
given the baby boom population retirement and the aging problem 
within the Social Security Administration. So I just want to 
commend you for putting together these hearings.
    I don't have any questions to ask any of the six panelists, 
but I would like to just make a couple of observations. GAO at 
the last hearing indicated that if the workforce level does not 
change, the Social Security Administration would have to have a 
27-percent increase in productivity by the year 2010 in order 
to accommodate the additional workload. Obviously, that is 
probably not doable under any circumstances, and certainly we 
have our challenge ahead of us, given the tight constraints in 
terms of the budget cap issue as well.
    And, secondly, I just want to point out if one looks from 
fiscal year 1993 to 1999, I think Mr. Apfel indicated that 
there was a 2-percent reduction in overall staffing in those 
years, in the Social Security Administration. Unfortunately--I 
don't want to use the word ``misleading'' because Mr. Apfel did 
not intend to mislead anybody, but the figures are somewhat 
distorted when one looks at it that way because from 1985 to 
1993, there was a 16-percent staffing reduction. And if one 
goes from 1985 to 1999, there is a 17-percent drop.
    It basically tells me that after 1993, there was a 
significant reduction in the Social Security Administration, 
and that was probably the baseline and any other cut since then 
has really affected the ability of the agency to perform its 
responsibilities. Somehow, we have to come to grips with that 
if, in fact, we want to deal with disability problems, and 
obviously the day-to-day functions of the agency as well.
    And so I have no questions. It is an issue that undoubtedly 
we are going to be all working closely together on over the 
next few years, and certainly I look forward to working with 
the chairman on this as well.
    Chairman Shaw. Thank you, Bob, and I would like to just 
make a point here. When I came to Congress almost 20 years ago, 
I was back in my old law office one day and there was a legal 
problem that I wanted to look up. And I went to the library and 
pulled down a couple of books and I noticed that the advance 
sheets had not been updated for years and years. And I asked 
one of my old partners, I said what kind of a law office are 
you running? He says, oh, we don't even use these books 
anymore. He says, we are all online now.
    Twenty years ago the faxes were just beginning to come out, 
and there have been tremendous advances made in technology. But 
having said that, I don't have the ability to sit here and 
figure out or make any definitive statement as to how much of 
the workload has been taken over by technology. I am sure there 
is some difference of opinions out there.
    But the 17 percent that Mr. Matsui talks about, is the 
increase of productivity because of the advances in technology 
taking up the slack? I don't know the answer to that, but I 
think that you as witnesses have certainly put up some caution 
flags that we should be very concerned about.
    One of the areas that is constantly on my mind and I am 
very troubled by is the tremendous delay in SSI claims. In 
order to be eligible for SSI, you have to be disabled and you 
have to be poor, and for people to have to wait almost a year, 
or 200 days, I believe, as the Commissioner said, to me, is 
painful and it is something that these people shouldn't have. 
Obviously, we want proper screening to take place, but those 
that are truly disabled and truly needy, we want to be sure 
they get in the system as quick as they possibly can.
    Ms. Augustus, you spoke on this area first, talking about 
the backlog and what not. Is the question of the backlog the 
big problem or is the question as to the process by which 
people are brought through the system the problem? In answering 
the question, I would say suppose there is no backlog, suppose 
the first customer is coming in the door today. What is a 
reasonable time for somebody to get through the system?
    Ms. Augustus. Mr. Chairman, are you speaking of an initial 
disability claim?
    Chairman Shaw. Yes, I am just strictly on disability.
    Ms. Augustus. I think a reasonable amount of time would be 
6 weeks, but that certainly doesn't happen. And I think you 
pointed out that with an SSI claim, in addition to the 
disability claim, they have to do the income and asset 
investigation which takes a long time. And as I said, too, a 
lot of the SSA employees can't translate those complex rules 
into plain language for the beneficiary, and so there is a lot 
of miscommunication about how do they figure out what is a 
resource, how do they calculate what is earned and unearned 
income. So, that takes up a lot of time on both the part of the 
SSA staff and the understanding of the potential beneficiary. 
It just adds to the processing time.
    Chairman Shaw. Well, is the backlog the problem?
    Ms. Augustus. The backlog is a huge problem.
    Chairman Shaw. Is it the problem?
    Ms. Augustus. I think it is not the problem. I think you 
have issues on the front end and then you have issues on the 
back end. So when you finally get somebody onto the rolls, you 
have another whole set of post-entitlement issues, and that is 
making sure somebody maintains their financial eligibility for 
the SSI program, as well as all the over-payments and under-
payments that happen as a result of people going back to work 
or having other types of income. So there are backlogs on both 
ends and it is a huge problem.
    Chairman Shaw. Mr. Skwierczynski, you talked about the 
problems that you saw of people being face-to-face rather than 
having online applications, and your testimony talks about the 
online applications. That also tells us that there may be some 
flexibility in working conditions, such as some of the 
employees working at home. Do you see this in the future, or 
how do you see as far as the necessity to have the employees in 
the workplace rather than working out of their homes, as so 
many offices are beginning to branch out in that area?
    Mr. Skwierczynski. One of the biggest issues with our 
workforce when they come to the union and we ask them, you 
know, what kind of improvements would you like in your working 
conditions, is work at home. Our workforce is demanding work at 
home and wants it a lot, and I think as technology increases 
work at homes becomes more feasible.
    We just went through some lengthy contract negotiations in 
1999, and unfortunately the Administration's position at the 
table was very much against work at home to any large degree. 
So we have to get through that problem of changing the mind set 
of management with regard to the issue of work at home.
    I think, you know, there is a variety of things that can be 
done to streamline the process. The union certainly isn't 
against claims on the Internet. However, there are issues about 
the use of the Internet that need to be addressed. There are 
issues of privacy and there are also issues of once someone 
does file an application on the Internet, what happens with 
that work.
    The retirement claims are very complex and there are a 
number of issues that may arise in the course of a claim. The 
proposals that the agency has discussed with us about doing 
work on the Internet would indicate that they expect a large 
percentage of these claims to have a human interaction because 
in the course of going through the screens, if questions arise 
the complexity of the issues becomes such that it is thought 
that you will need human interaction. And our concern is where 
is that human interaction going to be.
    Every survey and every focus group the agency has ever done 
indicates that the clients prefer a community-based worker to 
deal with them than somebody in some centralized place 
thousands of miles away, and that is truly a concern of ours. 
When claims are done on the Internet, I think we ought to ask 
the public, would they prefer someone in their community 
dealing with issues that arise on that application or would 
they prefer someone in a centralized site thousands of miles 
away who really cannot deal with other community-based services 
that they may desire or need. That is some of the concerns we 
have.
    The deputy commissioner, Mr. Mesterharm, of the systems 
within SSA has indicated that some of these cases would require 
90 screens. We think that, you know, there needs to be a lot 
more thought put into doing applications on the Internet which 
would require a client to go through 90 screens. I don't think 
a lot of people are going to want or desire to do that.
    And so, you know, those are just a few of the concerns I 
have. I think, you know, our workers believe that some of the 
work can be done at home. Obviously, you can't have people come 
to your house for an interview. You would have to have a 
telephone operation or maybe an Internet operation, but we 
think that work at home is certainly feasible and we would hope 
that the agency would change their attitude about that.
    Chairman Shaw. Ms. Spurgeon, it is worth noting that the 
Disability Determination Service work is within not only the 
Federal budget constraints, but also State budget constraint. 
Would you describe to us some of the budget constraints that 
you deal with at home? I assume that would be in Louisiana.
    Ms. Spurgeon. Dealing with the hiring issues, once the 
State puts a freeze on hiring, we are restricted whether we 
have been released to do that or not, And the fights that we 
have to go through to obtain an exemption. We are restricted on 
the hiring pool that we can hire from, transfers, layoffs, and 
different things that go on within the interagency actions in 
my State.
    Chairman Shaw. Okay. Well, I want to thank this panel for 
being with us this morning, now this afternoon, and sticking 
with us through the good part of the day. I think it has been 
very helpful for this committee in order to fulfill our 
oversight responsibility.
    [The responses of Mr. Skwierczynski, Mr. Korn, Ms. 
Augustus, and Mr. Hill, to questions submitted by Chairman 
Shaw, follow:]

                                        NATIONAL COUNCIL OF
                                SSA FIELD OPERATIONS LOCALS
                                                     April 25, 2000
The Honorable E. Clay Shaw, Jr.
United States House of Representatives
2408 Rayburn House Office Building
Washington, DC 20515

    Dear Congressman Shaw:

    Subject: SSA Internet Claims-Your letter of April 12, 2000

    This is in response to your letter of April 12, 2000 which requests 
further information regarding my assertion that security of SSA's 
Internet claims initiative is inadequate.
    My concerns about the security of the online application process 
are partially satisfied by the agency's decision to use encryption 
technology during the transmission of personal data collected in the 
online application form. Data transmitted from the claimant to Social 
Security will be received into and temporarily stored in a separate 
database. Only later will it be merged with the Social Security claims 
processing system. This will be done only under the supervision of 
Social Security employees.
    The issue of authentication remains a matter of concern. 
Authentication was a fatal flaw in the initial deployment of online 
PEBES. It does not appear that Social Security has learned the lessons 
of the 1997 PEBES experience.
    On June 10, 1997, Mary J. Culnan, Ph.D., Commissioner, President's 
Commission on Critical Infrastructure Protection, provided testimony to 
SSA in a hearing in Atlanta, Georgia, which drew the following 
conclusions about PEBES and authentication issues:
     SSA can not insure the person requesting PEBES online is 
the record subject
     Authentication data is known to others or available 
commercially
     There are no other facts known solely to SSA and the 
record subject that could be used to ensure unauthorized access could 
not occur. The costs of assigning passwords exceed the benefits.
     A casual surfer is unlikely to be able to gain 
unauthorized access; however, the same is not true for a determined 
individual.
     The only bulletproof method of authentication is a digital 
identity. However, there is currently no infrastructure in place for 
issuing digital identities to the general public and for managing their 
use, nor is it likely such a system will be implemented in the short 
term.
    Dr. Culnan cautioned that if PEBES were to again be offered online 
the Agency should take the following action:
     Set a low threshold for the number of failed 
authentication attempts before blocking a record.
     A critical issue for SSA is less about privacy and more 
about public confidence. SSA must insure that the public has confidence 
in the privacy of their interaction with SSA. If the public does not 
have confidence they can do business electronically with SSA, these 
perceptions are likely to further decrease public confidence in the 
Federal government overall, and to poison the water for other federal 
agencies who plan to offer electronic services to the public.
     Appoint a privacy advisory board and make privacy part of 
the business case for all new electronic commerce applications 
involving personal information.
    The same methods for authentication used for online PEBES are to be 
used for the online application process. Neither ``password/personal 
identification number'' nor ``public key infrastructure (PKI)'' 
authentication technology will be used.
    To answer your two questions: The evidence of inadequate safeguards 
is contained in the body of evidence developed in 1997 as part of the 
discussion surrounding the first PEBES experiment.
    The point I am making is that valid concerns about security and 
authentication raised in 1997 have not been resolved and Social 
Security is about to repeat the same mistakes. It appears that despite 
the serious concerns raised in 1997 about security and authentication 
of public Internet transmissions, this issue will not be resolved 
unless Congress intervenes. SSA is about to repeat the same mistakes 
that resulted in widespread public criticism of the online PEBES 
debacle.

             Respectfully,
                                       Witold Skwierczynski
                                                          President
      

                                

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                                        NATIONAL COUNCIL OF
               SOCIAL SECURITY MANAGEMENT ASSOCIATION, INC.
                                                     April 25, 2000
The Honorable E. Clay Shaw, Jr.
Chairman
Subcommittee on Social Security
1Committee on Ways and Means
U.S. House of Representatives
B-316 Rayburn House Office Building
Washington, DC 20515

    Dear Chairman Shaw:

    I am writing to provide answers to the questions you raised with 
regard to my recent testimony relating to Social Security's readiness 
for the impending wave of baby-boomer beneficiaries. I appreciate your 
continued interest. I hope this will not only help clarify the issues 
presented in my testimony, but will reinforce the need to ensure that 
Social Security receives a level of resources sufficient to meet its 
obligations to current and future beneficiaries.
    1. You asked whether some of the future demands on SSA could be met 
with improved automation or through more efficient use of resources. 
Not only is this possible, but it will in fact be essential given the 
scope of the projected workload increase coupled with federal spending 
limitations. Automation, in particular, offers significant potential 
for reducing the resource levels needed to serve the expanded 
beneficiary base. However, in evaluating the potential of future 
automation to reduce human resource needs at SSA, it is important to 
understand these three points:
     Significant gains in automation require a significant 
commitment of resources. Software development itself is extremely labor 
intensive. While the eventual payoffs would exceed the immediate 
investment, SSA currently has had to table several software 
improvements simply because there are not enough employees available to 
handle all projects. The old saying ``it takes money to make money'' 
can aptly be applied to automation improvements. It takes an investment 
in resources today to provide the improvements in software that will 
save the resources tomorrow. In addition to software, SSA will 
continually need to upgrade its hardware to ensure it has the platform 
necessary to take advantage of the improvements in timesaving 
technology. This is why we believe the Commissioner's idea to establish 
a capital fund to flexibly fund future hardware needs is a good one.
     The timing and magnitude of savings produced by automation 
are often difficult to predict. Certainly, Congress and the American 
taxpayer have a right to expect that investments in hardware and 
software development will result in some combination of service 
enhancements and service efficiencies at least equivalent to the level 
of investment. However, in today's fast-paced climate of rapidly 
expanding technology, the best organizations (public or private) cannot 
afford to wait until all factors are known prior to investing in 
significant software development. Like the private sector where 
investors put their trust in well-managed companies, Congress must 
invest in agencies with a history of prudent management, with some 
degree of faith that said investment will result in tangible, long-term 
improvements. Not only has SSA's management rated among the best by 
organizations both inside and outside the government, but we believe 
our current executive leadership is up to the task.
     Automation will not eliminate the need for additional 
human resources. Many of those we serve, especially the aged and the 
disabled, will require personalized face-to-face service regardless of 
advances in technology. While we must make maximum use of technology to 
reduce our need for human resources, it would be a mistake to believe 
that SSA can meet the full challenge of the baby-boom wave without 
additional human resources.
    With regard to other areas where SSA can use its resources more 
effectively, our association continually works with SSA's Executive 
Staff to identify such efficiencies. I can honestly tell you that the 
current team of SSA executives has been open to many of our ideas. As 
long as the commitment to frequent and honest communication between 
those of us on the front-line and those in headquarters remains, we 
believe SSA will continue to be able to identify and act upon such 
efficiencies.
    2. I testified that it generally takes a new claims representative 
(CR) three years to be fully trained. You asked why learning the job at 
SSA is much more challenging than adapting to other comparable jobs 
such as at a bank or a doctor's office. The claims representative is 
the primary technical position in SSA's field offices. While CRs do 
many of the same daily functions as the aforementioned private sector 
employees, such as deal with members of the public and answer 
inquiries, unlike these private sector employees, their primary 
function is to accurately administer a complex set of laws and 
regulations. As such, their responsibilities are probably more closely 
related to attorneys and others in the legal profession, rather than 
employees in general office work. CRs must be able to deal with any 
potential set of client circumstances, and make an accurate ``legal'' 
determination as to entitlement. In addition, the CR must understand 
how to properly document the decision, including securing necessary 
documentary evidence, and how to effectuate the decision using SSA's 
complex automated systems. The Program Operations Manual, that contains 
most (but not all) of the instructions that a CR is responsible to 
carry out, contains literally dozens of volumes, and in its paper form 
barely fits in three large bookcases. Given this complexity, it is not 
hard to understand how it can take three years of experience before a 
new CR has a journeyman's understanding of program administration.
    3. You asked how we could justify SSA's request for $47 million in 
information technology without a specific promise as to what this $47 
million will buy for the taxpayer. First let me say that in my position 
as a field manager and representative of SSA's field management 
organization, I am not in a position to specify what this money will 
specifically buy. However, drawing upon my answer to your first 
question, a certain level of investment in automation is warranted 
simply to ensure that SSA has the resources needed to invest in 
technology on a just-in-time basis. If there is one automation lesson 
to learn from those companies in the private sector who have been 
successful, it is the need to be able to act quickly to take advantage 
of emerging technologies, such as the Internet. The old way of 
identifying a potential opportunity, studying it for a year or two and 
then spending an additional year or two securing the necessary 
resources is simply non-competitive. SSA must have resources ready and 
available to pounce on technological opportunities. I believe that 
today's taxpayer would not only support a flexible automation 
improvement capital fund in a well managed agency such as SSA, but 
would think it as a wise and responsible way of doing business.
    Again, thank you for the opportunity to provide these 
clarifications as part of the hearing record. We appreciate your 
support for a strong, viable, and efficient SSA, and hope you and the 
entire subcommittee will be successful in helping us obtain the 
resources we need to remain so.

            Sincerely,
                                                 Steve Korn
                                                  President, NCSSMA
      

                                

                                              SSI COALITION
                                                     April 24, 2000
E. Clay Shaw, Jr.
Chairman
Subcommittee on Social Security
U.S. House of Representatives
Washington, D.C. 20515

Re: Hearing to Examine Social Security's Readiness For the Impending 
        Wave of Baby Boomer Beneficiaries

    Dear Chairman Shaw:

    This letter is in response to your letter of April 12, 2000, asking 
me to respond to the following questions:

1. Is SSA addressing the training problem?

    In my opinion, SSA is trying to address the training problem, 
although I believe it will take a long time to properly train all the 
field office and teleservice staff. SSA hopes that the new Employment 
Support Representative (ESR) position, that SSA is piloting this summer 
across the country, will help with training local staff on the work 
incentives programs. These ESRs, however, will not be fully in place 
for a couple of years, which means that the training will not reach all 
the staff for at least that long. My other concern, in addition to the 
training issue, is that SSA's culture at the local office must also 
change, and that will take even longer. The local offices, 
historically, have prioritized taking applications for benefits and 
paying out benefits accurately and timely. We are now asking them to 
also encourage disability beneficiaries to work by giving them accurate 
information on work incentives and to accurately and timely record the 
earnings of beneficiaries who report them. This will take time.

2. Are there specific aspects of the SSI program that can be 
simplified? Would simplification of the program help my clients, as 
well as help alleviate staffing and training pressures on the agency?

    I believe that the SSI in-kind support and maintenance rules should 
be eliminated. From my experience, it is difficult for beneficiaries to 
understand the in-kind income reporting requirements, especially as 
this type of income can vary from month to month. The $2,000 resource 
limit for an individual, and $3,000 limit for a couple should be 
raised. The deeming rules are also very confusing. The administrative 
time that it takes to process the notices and verify these income and 
resource rules seems to outweigh any cost savings to the general 
revenue fund.
    I refer the committee to the Final Report of the Experts of the SSI 
Modernization Project from August, 1992. This report made some cogent 
suggestions for simplifying the SSI program with negligible costs. 
Unfortunately, most of the report's recommendations have not been 
translated into any legislation. These recommendations would greatly 
improve the efficiency of the administration of the SSI program and 
assist SSI beneficiaries to better understand their SSI reporting 
responsibilities.

3. Please elaborate on your statement that there frequently is little 
or no investigation of family members who serve as representative 
payees. Also, what are the most serious issues of fraud and abuse?
    I have represented several beneficiaries over the past few years 
who have alleged that their family members, who also served as their 
representative payees, were improperly using their SSI funds. I have 
also heard anecdotally of many other instances. Many of these cases 
involved individuals who were suffering from psychiatric disabilities. 
I believe that it is difficult for these individuals to lodge 
complaints about their representative payees because of their perceived 
lack of credibility, and because, for many, there are no alternative 
representative payees available. Unfortunately, there is not much that 
SSA can do for individuals who need representative payees. The fact is 
that it is difficult to find people willing to serve as representative 
payees, and when SSA chooses a representative payee, it often involves 
a subjective assessment of their ability to serve. Thus, willing family 
members are usually selected, even if they are not the best 
alternative. A suggested solution would be to have SSA, in conjunction 
with a group like AARP for example, recruit and train volunteers, such 
as retirees, to serve as representative payees.
    There is fraud and abuse in every corner of our society, and it is 
not limited to, or more prevalent in, the SSI program. The most serious 
issue, in my opinion, is encouraging a culture at SSA that presumes 
that every SSI beneficiary is committing fraud and abuse. As I already 
mentioned, the elaborate income and resource rules are truly confusing 
to many SSI beneficiaries, as well as their families and advocates. It 
would help if SSA field office staff could spend more time explaining, 
in understandable terms, the reasons for their decisions, and do that 
in a respectful manner, rather than interrogating people. SSA must do 
more to create better written notices that are understandable. It would 
also help if SSA would have the ability to make more timely decisions 
about overpayment issues, so that beneficiaries do not incur such large 
overpayments. More timely decisions about overpayments would also 
identify those situations where fraud is involved more quickly.

4. Questions about extended office hours. Do some SSA offices keep 
evening or Saturday hours? How would such a change be received? How 
widespread a practice is it for SSA to do a mobile office? Should SSA 
do it more? In general, would customers be better served by more SSA 
employees going out into the community, rather than maintaining field 
offices?
    I do not know of any SSA offices that keep extended office hours. I 
believe that evening and Saturday hours would be a huge benefit for 
people. Many people cannot afford to take off a day of work to go to an 
SSA office. Of course, SSA would have to have additional staff, as I 
understand that Saturday is when many SSA employees catch up on work 
they could not attend to during the week.
    Again, I do not know how often SSA takes a laptop computer out into 
the community. SSA does it in Chicago, and it has been very well 
received. With better use of technology, SSA could reach far more 
people, far more efficiently, than they do at present. I do not know 
that customers would be better served by having SSA employees go out 
into the community, but it would help many folks who could not make it 
to an SSA office during regular office hours. I think that SSA must 
maintain field offices, as some people would not feel comfortable 
discussing SSA business in any setting other than an SSA office. It 
will also help when people will be able to use the Internet to transact 
business with SSA, instead of going to a local office.
    I want to thank the committee again for the opportunity to present 
my thoughts on these issues. I also want to reiterate my hope that the 
committee will recommend increased funding for SSA so that SSA can 
provide more accurate and more efficient service to the public.

            Sincerely,

                                               Sue Augustus
                                                 Associate Director
      

                                

Response of Mr. James A. Hill

    I appreciate the opportunity to respond to the questions 
you forwarded in your letter of April 12, 2000.

De-Legalization of OHA

    ``Delegalizing'' is the process of eliminating or reducing 
the use, independence and effectiveness of attorneys, whether 
ALJs, staff attorneys or claimant's representatives, in the SSA 
disability decision process. Understanding the attempts of the 
Social Security Administration (SSA) to ``de-legalize'' the 
adjudication process at the Office of Hearings and Appeals 
(OHA) requires recognition of the hostility manifested by many 
officials and employees of the Social Security Administration 
(and State Agencies) towards the OHA and the ``legal system'' 
it represents. The driving force behind the repeated attempts 
by SSA to ``de-legalize'' OHA is a fundamental unhappiness with 
the number of ``reversals'' of initial and reconsideration 
decisions issued by OHA's adjudicators which is attributed to 
the independence enjoyed by these decision makers. Establishing 
control over the process (and the OHA decision makers) is the 
underlying purpose of the ``delegalizing'' effort. SSA is not 
delegalizing to become more efficient; in fact, it has and will 
make SSA less efficient.

    Examples of ``delegalization'' include:

    1. The dismantling and destruction of the Senior Attorney 
Program;
    2. The establishment of a Hearing Process system where most 
OHA staff attorneys will be supervised by non-attorney 
paralegals;
    3. The change to paralegals (who are paid at the same rate 
as staff attorneys) as the primary decision writer and advisor 
to the ALJ on individual cases in OHA;
    4. The removal of the ALJ from the pre-hearing development 
process;
    5. The establishment of non-attorney, non-OHA, writing 
units to draft decisions for the ALJs;
    6. The diminished control over OHA by the Associate 
Commissioner and Chief Administrative Law Judge (both of whom 
must be attorneys) and the increased control of the Deputy 
Commissioner for the Office of Disability (a non-attorney);

    Simple steps to improve the efficiency of OHA would 
include:

    1. Return to the original Senior Attorney Program where 
senior attorneys not only drafted and issued fully favorable 
decisions but were also the primary decision drafters and legal 
advisors to ALJs;
    2. Return attorneys, supervised by attorneys, to their 
former role as primary legal advisor and decision drafter for 
the ALJ;
    3. Improve the quality of non-attorney decision writers by 
requiring a minimum level of education/training and recognized 
paralegal certification;
    4. Return direction of the pre-hearing development process 
to the ALJ;
    5. Eliminate writing units outside of OHA; and
    6. Return control of the OHA to the Associate Commissioner 
and Chief Administrative Law Judge.

    These simple steps would do much to reverse the SSA 
missteps that have contributed to the backlog of cases at OHA 
and slowed our progress in decreasing processing time.

An Efficient Adjudicative System

    While the bifurcated adjudication process meets all of the 
needs of both the Agency and the claimants it serves, there are 
several improvements in the process at the initial and 
reconsideration levels that would increase the efficiency of 
the appeals process.

    1. Apply the same criteria and factors for determining 
disability at the initial level as are applied in the appellate 
process including subjective factors.
    2. Permit adjudicators at the initial level to exercise a 
greater degree of independent judgment thereby favorably 
determining cases at the initial level that will eventually be 
favorably decided at OHA.
    3. Ensure that each case is properly and fully developed at 
the initial level. The additional time required for development 
of the record at hearing offices is a major factor in the 
untimely decision making process which plagues the current 
disability adjudication system.
    4. The quality assurance at the initial level should be 
more directed at accurately determining which applications 
should receive favorable determination avoiding the necessity 
and expense of favorably deciding substantial numbers of cases 
at the OHA level.
    5. The quality assurance program should focus on ensuring 
that cases are properly developed before being forwarded to 
OHA.

    The current SSA disability adjudication process, which is 
bifurcated into an initial (and reconsideration) phase 
characterized by a purely administrative adjudication process, 
and an appellate phase, characterized by a judicial process, is 
an efficient adjudicative system for the Social Security 
Disability Program.
    Given their vast numbers, processing initial application 
through judicial procedures would require an organization many 
times the size of the current OHA. The expense would be 
enormous and unnecessary. Judicial proceedings are unnecessary 
to establish disability for many applicants. Currently, the 
initial and reconsideration phases pay approximately 35% of the 
applications made. Approximately 25% of those who receive 
unfavorable determinations decline to appeal to the OHA level. 
There can be no doubt that the current administrative process 
is more efficient than any judicial process, but it does not 
provide the level of due process to which Social Security 
taxpayer are entitled. Americans expect their day in court.
    The adjudication process at the initial level is conducted 
with minimal participation by the claimant. The decisional 
product, the ``Disability Determination,'' is a three-page form 
letter from the Regional Commissioner (who played no role in 
the decisional process) that contains almost no specific 
information as to why the claimant's application was denied. No 
rationale is provided describing why the decision was made, 
leaving the recipient with the impression that the decision was 
arbitrary and perhaps even capricious. That impression is not 
entirely unjustified. Preparation of such a determination 
consumes little time, requires few assets, and requires no 
legal expertise on the part of the preparer. Of course, were 
these determinations appealed to the District Court as the 
final decision of the Commissioner, every single case would be 
reversed or remanded back to the Agency -every single case.
    The judicial process at OHA is designed to afford each 
individual claimant the opportunity to present his/her case 
directly to the decision maker in a face-to-face setting via 
the due process hearing. For the claimant, it is in fact his/
her day in court. Each claimant can directly participate in the 
proceedings and receive the individualized attention normally 
associated with trial proceedings. For those individuals who 
are not disabled, the final product of the judicial procedure 
is an ALJ decision that explains in detail why the individual 
is not entitled to disability. This decision, which must be 
capable of withstanding judicial review, does require extensive 
legal expertise in its preparation.
    By paying deserving cases at the earliest possible time 
(thereby reducing the number of appeals to OHA) and ensuring 
that cases are properly developed when received by OHA (thereby 
reducing the processing time for the remainder of the cases), 
the State Agencies can significantly improve the efficiency of 
the entire adjudication system.

The Senior Attorney Program

    Since its inception in 1995 the Senior Attorney Program has 
made a significant contribution to the substantial reduction in 
the disability backlog at OHA. Nonetheless, the program has 
always provoked fervent but unfounded opposition. Provoking 
controversies was the method by which those who opposed the 
Program hoped to prevent its implementation and, after 
implementation, prevent its success and precipitate its demise. 
Unfortunately, it appears that SSA will sacrifice the Senior 
Attorney Program in order to secure the cooperation of those 
parties who have so long opposed and even sabotaged the Program 
in implementing the Hearings Process Improvement Plan.

    The Senior Attorney Program was controversial because it:

    1. It threatened the decision making monopoly of the 
Administrative Law Judges at the hearing level;
    2. It threatened the control that the quality control 
bureaucracy held over non-ALJ decisions in SSA;
    3. It challenged the widespread belief in SSA that 
operational problems in OHA could not be solved internally, and 
that a massive reorganization of the disability process was 
required to solve those problems;
    4. The Senior Attorney Program was inconsistent with the 
Agency's policy to ``de-legalize'' the appellate process at 
OHA.

    Administrative Law Judges vigorously opposed the Senior 
Attorney Program because it challenged their role as the sole 
decision makers in OHA hearing offices.

    1. Many ALJs and the Association of Administrative Law 
Judges resented the intrusion of Staff Attorneys into the field 
of decision makers in the OHA hearing offices.
    2. Many ALJs feared that the Senior Attorney Program was 
the first step in the elimination of ALJs as decision makers at 
OHA. While such a concern is unreasonable, considering the 
hostility that many in SSA and OHA hold for the ALJs, such a 
fear is understandable.
    3. Administrative Law Judges in management positions failed 
to implement the Program properly in many hearing offices. The 
Chief Administrative Law Judge, the Deputy Chief Administrative 
Law Judge and many Regional Chief Administrative Law Judges 
were either unwilling or unable to ensure that many Hearing 
Office Chief Administrative Law Judges properly implement the 
Program consistent with national directives
    4. Many ALJs and the Association of Administrative Law 
Judges proclaimed that the Senior Attorney Program was merely a 
method to pay down the backlog. They continued this theme long 
after hard data demonstrated its falsity. Approximately 25% of 
the cases reviewed by Senior Attorneys resulted in favorable 
determinations. ALJs have historically paid a much higher 
percentage of cases, and in fact, paid a higher percentage of 
Senior Attorney Program cases than did Senior Attorneys.
    5. ALJs also complained that the Senior Attorney Program 
deprived them of their best decision writers. From its 
inception in 1995 until July 1, 1998, all of OHA's Staff 
Attorneys with at least three years experience at OHA were 
Senior Attorneys. While they were required to spend at least 
25% of their time performing Senior Attorney work, they were 
available for the remainder of their time to draft ALJ 
decisions if hearing office management deemed it advisable. 
However, on July 1, 1998 SSA significantly downsized the number 
of Senior Attorneys and restricted the remainder of Senior 
Attorneys to performing only Senior Attorney work. SSA 
management made these changes unilaterally over the strenuous 
objections of the National Treasury Employees Union. It was 
only at this point that ALJs may have lost some of their best 
decision drafters.

    The Disability Process Redesign Program (DPR) and Hearings 
Process Improvement Teams have vigorously opposed the Senior 
Attorney Program because it represented an inexpensive and 
effective alternative to the extensive program changes proposed 
by either program.

    1. At the time of the inception of the Senior Attorney 
Program, the massive Disability Process Redesign (DPR) was also 
in its design and initial testing phase. The initial impetus 
for DPR was the huge backlog that had accumulated at OHA. DPR 
demonstrated that SSA was committed to ``improving'' the 
appellate process through the implementation of massive, multi-
component reorganizations that substantially de-legalized the 
appellate process at OHA. One of the key DPR positions, the 
Adjudication Officer (AO), was created specifically to de-
legalize the appellate process. The Senior Attorney Program 
challenged the prevalent theory that OHA's production problems 
could not be solved without a fundamental reorganization.
    2. Even today SSA is unwilling to accept that OHA's 
productivity problems were being solved within OHA without 
significant interference from the remainder of SSA. The 
Hearings Process Improvement Plan is merely the latest 
reincarnation of the big fix'' philosophy so prevalent in SSA. 
HPI appears more intended to disguise the failure of DPR than 
improve the hearings process. The Senior Attorney Program 
represents the same threat to HPI as it did to DPR.
    3. DPR viewed the Senior Attorney Program as competition 
and sought to avoid competition by eliminating the Senior 
Attorney Program rather than competing with it. However, since 
the Senior Attorney Program offered immediate relief to the 
backlog situation and DPR could offer only a vague future 
impact, the Senior Attorney Program was implemented. The 
competition proved rather one sided. The Senior Attorney 
Program was a resounding success, while the DPR was an equally 
resounding failure.
    4. The success of the one program made it impossible to 
hide the failure of the other which has caused embarrassment to 
the SSA officials responsible for and committed to the DPR. SSA 
officials do not want to risk a similar fate for HPI. By 
eliminating the Senior Attorney Program they avoid the 
unfavorable comparison between the small, focused program that 
works and an untried experiment designed to de-legalize OHA.
    5. The continuation of the Senior Attorney Program is 
inconsistent with an underlying theme of SSA mandating the 
``de-legalization'' of the appellate process at OHA.

    The Office of Program Integrity (OPIR) now the Office of 
Quality Assurance (OQA) also had reason to oppose the Senior 
Attorney Program.

    1. OPIR maintained rigid control of the decision making 
process at the state agencies and was resigned to its inability 
to control the ALJs who had the iron clad protection of the 
Administrative Procedures Act (APA). The AO and the Senior 
Attorney were new classes of decision makers beyond the control 
of OPIR. It takes little imagination to theorize that 
eventually the state agencies, after observing the decisional 
freedom of the AO and Senior Attorney, would eventually seek 
their own independence from the oppressive hand of OPIR.
    2. When OPIR failed to prevent the birth of the Senior 
Attorney Program, it raised the specter of poor decisional 
accuracy. OPIR in conjunction with OHA established a forum 
through which ALJs, and for a while Senior Attorneys, and 
OPIR's disability examiners would review ALJ and Senior 
Attorney on-the-record decisions. Given the level of opposition 
of ALJs and OPIR to the Senior Attorney Program, this review 
process took on all the characteristics of a Star Chamber. In 
fact so biased were the reviews, that OHA established a 
procedure whereby the Appeals Council would independently 
review a sample of Senior Attorney and ALJ decisions. 
Decisional accuracy of ALJs and Senior Attorneys was 
essentially identical. No statistically valid study has ever 
demonstrated decisional accuracy significantly less than that 
of ALJ decisions. Yet the specter of poor decisional accuracy 
was a threat to the continued existence of the Senior Attorney 
Program.

    The National Treasury Employees Union strongly recommends 
that the Social Security Administration reinstate the original 
Senior Attorney Program in which Senior Attorneys not only 
drafted and issued fully favorable decisions but were also the 
primary decision drafters and legal advisors to ALJs. Without 
the reinstatement of this program, OHA cannot delivery the 
service expected by SSA and Congress.

    Addendum

    I believe that the suggestions made here, if carried out, 
will significantly reduce the disability backlog, reduce 
processing time and improve the quality and accuracy of SSA 
decision making. SSA can implement these changes without any 
additional legislation, funding or staffing.
    However, I believe that two further changes would markedly 
improve the level of service delivered to the American public 
consistent with the Agency's goal of world class service. The 
National Treasury Employees Union strongly recommends that SSA:

    1. Improve the quality and quantity of its ALJ decisions by 
hiring as ALJs those attorneys who are experts in Social 
Security disability law. Many such experts exist in the federal 
government and in private practice, yet their expertise is not 
considered in the ALJ rating and ranking process. No single 
action will do more to improve the system than bringing in as 
ALJs those attorneys who have shown a life long commitment to 
learning and practicing disability law, whether that experience 
was gained as a federal employee or in private practice.
    2. Improve the quality and quantity of its ALJ decisions by 
instituting a Magistrate program to handle that workload which 
cannot be disposed of by a Senior Attorney yet still does not 
require the expense and time of an ALJ decision maker and a 
full blown hearing. These cases can include: cases in which the 
claimant waives the right to a hearing and requests an on the 
record decision and cases where the claimant consents to the 
jurisdiction of the magistrate.

    Both of these changes require Congressional action. NTEU is 
ready to work with your Subcommittee staff to prepare such 
legislation.
      

                                

    Chairman Shaw. I am very concerned about what is happening, 
particularly with the baby boomers coming on line. This 
committee will continue to work with the Social Security 
Administration with a single purpose, and that is toward 
improving the delivery system for the retirees as well as the 
disabled.
    Thank you very much, and this hearing is adjourned.
    [Whereupon, at 12:27 p.m., the hearing was adjourned.]
    [Submissions for the record follow:]
                                     AMERICAN FEDERATION OF
                                       GOVERNMENT EMPLOYEES
                                                     March 16, 2000
Mr. A.L. Singleton, Chief of Staff
Committee on Ways and Means
U.S. House of Representative
1102 Longworth House Office Building
Washington, D.C. 20515

    Dear Mr. Singleton:

Re: Readiness for Impending Wave of Baby Boomer Beneficiaries

    The Social Security Administration's (SSA) readiness for the 
impending wave of baby boomers will mainly be determined by how they 
train and utilize their current employees especially those employees in 
the lower grades. SSA has over 20,000 employees in the lower grades 
i.e. below the GS-9 grade levels that have not been trained to handle 
all aspects Title II or Title XVI programs. Most of these employees are 
women and individuals with disabilities who could perform the full 
range of SSA's program work if given the opportunity and proper 
training. SSA needs to remission itself in order to provide better 
service to our customers including baby boomers and to empower our 
employees at the same time. SSA workers are ready, willing and able to 
have ``one stop shopping'' in each workstation. A simple remission of 
SSA could make it the best Federal Agency if all employees were 
utilized to their fullest potential. Proper training could empower each 
employee with the skills; knowledge and ability to offer our customers 
one stop shopping. One stop shopping is the tools to truly empower 
SSA's workers and provide world class service to our customers.
    Remissioning is not new to SSA. The Albuquerque and Salinas Data 
Operation Centers were remissioned in early 1995 to TeleService 
Centers. Before remissioning, these Centers had many GS-4/5 grade level 
employees who posted wages to beneficiaries earning records and issued 
Social Security cards. This remissioning has been a benefit to the 
agency, the employees (promoted up to GS-8) and the public. However, a 
TSC is not yet one stop shopping because some work still has to be 
passed off to other employees. So why stop there when we have employees 
in every component capable of processing the entire action if given the 
training and the opportunity. I believe a bold step towards 
remissioning could work throughout SSA because of the talented 
employees. In the States' Disability Determination Section, most of 
14,000 employees are Examiners of support staff for the examiners. 
Unlike the DDS, job functions in SSA especially at the lower grade 
levels seem to be segregated to control classification. This is why SSA 
should be remissioned to empower all employees with the opportunity to 
provide one stopping for our customers.
    You don't have to be a rocket scientist to perform the work here in 
SSA. Who has the right to say that if I work in the Data Operation 
Center the average grade that I will obtain will be a GS4/5? Who has a 
right to say that if I work in Office of Central Record Operations the 
highest grade that I can obtain is a GS5/6? Who has a right to say that 
if I work in OHA (field) the highest grade that I can obtain is a GS7/
8? Who has a right to say that if I work in a TSC the highest grade 
that I can obtain is a GS8? Who has a right to say that if I work in a 
PSC the average grade that I will obtain is a GS9? If I work in a Field 
Office the highest grade that I can obtain 's a GS11? No one has that 
right. I believe we should be able to advance as far as our skills and 
talent will allow us to go individually. With proper training, we are 
smart enough and we have enough computers and program knowledge to be 
able to perform all aspects of SSA's work.
    Training employees to process an entire action, especially those in 
the lower grades, is one solution to make SSA ready for the impending 
wave of baby boomer beneficiaries. There are over 20,000 such 
employees. If these employees were empowered to provide one stop 
shopping to our customer, I believe SSA will be more than ready to 
handle all of our customers including the baby boomers.
    If you have any questions do not hesitate to contact me. I can be 
contacted at P. O. Box 1954, Chicago, Illinois 60690. My telephone 
number is 312/575-6105 or by fax at 312/575-6031.

    Sincerely,
                                                Earl Tucker
                                                              Chair
                                          AFGE EEO Committee in SSA
      

                                

                                     AMERICAN FEDERATION OF
                                       GOVERNMENT EMPLOYEES
                                                  February 29, 2000

SUBJECT: SSA's QUALITY ASSURANCE WORKERS SAVE TAXPAYERS BILLIONS

    Social Security Quality Assurance (QA) workers save taxpayers 
billions of dollars in General Revenue and Trust funds while striving 
to ensure that the public receives the benefits due them in a courteous 
manner.
    Through internal reviews, controls and audits in SSA we as workers 
save the taxpayers billions of dollars. It's a shame that some of the 
savings are never transferred to SSA's administrative budget for 
continuous improvement in these programs that save big bucks. In many 
of these money saving areas there is very little staff to process these 
workloads if they are processed at all. However, currently we are about 
one half the size we once were. In spite of our staffing shortage, we 
have continued to help SSA deliver world class service to the public 
and its, internal and external customers by accurately reporting on the 
health of the SSA programs Supplemental Security Income (SSI), 
Disability Insurance (DI), and Retirement and Survivors Insurance 
(RSI).
    The Regional Offices of Quality Assurances (ROQA) [formerly known 
as the Regional Office of Program and Integrity reviews] are crucial to 
SSA efforts to save money by maintaining and increasing quality. ROQA 
employees have over 25 years of experience in recording and reporting 
statisticallyvalid data on a timely basis to interested parties both 
inside and outside SSA. In the process, they have maintained good 
relations with a variety of other offices: Field.Offices, Regional 
Offices, Headquarters, State Disability Determination Services, Office 
of Hearing and Appeals, etc. We have a long history of participation in 
onsite reviews of SSA offices in order to help improve their 
operations. We have shown flexibility in adapting to new types of 
studies (such as payment accuracy of initial claims in the late 1801s), 
new court cases (such as Zebley and other Disability cases in the 
1901s), and new types of workloads (Disability Process Redesign now).
    In short, if the ROQAs did not exist, they would have to be 
invented. They are already in place (with no startup costs), ready to 
continue their efforts to improve quality and save SSA money.
    Our regional component consists of about 800 employees (less than 
1.5% of SSA employees) with two major branches i.e. Disability Quality 
Branch and Assistance and Insurance Program Quality Branch.

Disability Quality Branch

    The quality assurance function for Disability Insurance (DI 
Program) is carried out by the Disability Quality Branches (11 DQ911) 
of the Office of Quality Assurance (OQA). We save the taxpayer more 
than $15 for every $1 it costs us to review a disability case in the 
Preeffectuation Review (PER) sample. There is no similar review for 
title XVI disability cases. we have developed a profile for targeting 
favorable title II and concurrent title II/XVI cases most likely to 
contain errors for preeffectuation (PER) review instead of allowing 
these cases to be selected by chance. As a result, $317 million has 
been saved in cash benefits and/or to the trust fund for FY 1999, 
alone. These PER cases are actually reviewed by us before payments can 
be effectuated. At the present time we are only reviewing approximately 
50% of the Title II cases but we have saved more than $2 billion in 
unnecessary trust fund expenditures since 1980. If this effort were 
continued and more cases were reviewed including Title XVI, we would 
save the taxpayers even more money in the trust funds and general 
revenue.
    Recently, a targeted error prone profile for PER was revised to 
select favorable title II and concurrent title XVI/II cases which will 
improve the above figures by 6% (i.e.$50 Millions more dollars).
    Headquarters' OQA implemented a new PER review of 5,052 Office of 
Hearing and Appeals allowances. Our findings indicated that 440o of 
these cases were unsupported and referred to the Office of the Appeals 
Council(OAC). The Appeals Council agreed with 92% of these findings and 
remanded and/or reversed 65.2%.
    We should also be saving billions of dollars by doing more 
Continuing Disability Reviews (CDR). These are followup reviews that 
should be done after a claimant has received disability benefits for a 
certain period of time to see if they are still disabled and unable to 
work. SSA has increased these reviews but still more cases should be 
reviewed in order to reap additional savings.
    A Childhood Disability rereview plan was implemented recently to 
monitor the ongoing accuracy determination. These data have enabled the 
Administration to provide the States with early feedback on the degree 
of uniformity in the adjudication of Childhood Disability cases. 
Ultimately, this rereview system should save million of dollars in 
litigation cost associated with childhood disability cases.

Assistance and Insurance Program Quality Branch

    The quality assurance function for the Retirement and Survivor's 
Insurance Program (11RSI Program'') and The Supplemental Security 
Income Program (``SSI Program'') are carried out by the Assistance and 
Insurance Program Quality Branches (11AIPQ211) of the office of Quality 
Assurance (110QA11).
    These functions are conducted by means of the Index of Dollar 
Accuracy (``IDA'') study of recently adjudicated initial claims, the 
IDA study of recently processed post entitlement transactions, and 
special studies designed to assess areas of potential vulnerability or 
concern.
    We developed survey instruments, select samples, conducts surveys, 
performs statistical analysis and prepares reports and findings. In 
addition to ongoing surveys, we completed nine new market measurement 
studies involving over 21,0000 customer contacts.
    Our Prisoner initiatives resulted in 100,000 prisoners, who by law 
should not receive benefits after being taken off the SSA roles in 
FY99.
    We also strive to ensure that the public receives benefits to which 
they are entitled. We implemented an automated notice to over 600 
widow(er)s advising them of the eligibility for about $53.00 per month 
each on average, in higher benefits. This means that they will now 
correctly receive a total lifetime value of about $1/2 billion dollars 
in additional benefits.
    We have taken an ambitious program of corrective action process 
development. After conducting live corrective action tests, we created 
processes that identify and correct millions of errors, pay billions of 
dollars in underpayment and prevent large volumes of unnecessary 
actions and conserve resources as follows:
    Our analysis of 400,000 Automatic Earnings Reappraisal operation 
indicated that 150,000 accounts were underpaid. These accounts were 
paid and unnecessary work was prevented on 250,000 records as a result.
    our analysis of Automatic Reduction Factor/Delayed Retirement 
Credit prevented about 340,000 unnecessary/incorrect actions in FY99.
    Delinquent Overpayment Actions prototype systems were used to 
developed a new workload priority system, which handles over 400,000 
actions per year.
    We developed a Special Wage Payment process to automate over 40,000 
of this workload per year.
    A Workers' Compensation Study of the offset provision projects a 
total retroactive and estimated future overpayments is about $1 
billion.
    In FY 99 we improved the SSI high error redetermination profile. 
This profile improvement alone resulted in nearly $139 million of 
additional HEP benefits compares to FY98.
    The following are other examples of ongoing special activities 
conducted in the AIPQB, the result of which were either financial 
savings or improved service to the public:
     The AIPQB conduct ongoing monitoring of the 1800 number 
service in order to assess the quality of service to the public in 
terms of courtesy and the accuracy of information given to callers. 
Additionally, AIPQB make followerup calls to the public to gauge 
customer satisfaction.
     The AIPQB monitors the quality of phone service to the 
public in District offices and recommend improvements were appropriate.
     The AIPQB have been involved in testing the quality of 
phone service to nonEnglish speaking members of the public.
    The efforts of the AIPQB result in billions of dollars in annual 
saving to the taxpayers as well as ensuring that the public is 
satisfied with our service.
    In conclusion, OQA (field) consist of SSA workers in twoquality 
assurance branches, i.e. DQB and AIPQB. These workers are skilled 
technicians with the necessary autonomy to perform accurate diagnoses 
and prescribe cures for many problems in all the programs in SSA. As a 
result, billions of taxpayer dollars are saved annually by these 
dedicated workers but these savings do not translate into adequate 
staffing on the administrative side to do the total job required. More 
staffing is needed to provide the public with the service that they 
expect from SSA and protect both general revenue and the Trust funds 
from unwarranted expenses.
    As you know, FY2000 appropriations had a .38% cut across the board 
for all Agencies including SSA. This amount should be restored in order 
to hire adequate staffing. The funds are essential to deliver the 
service that taxpayers expect. This cut amounted to $134 million and is 
causing a drastic impact on service to the public this fiscal year. The 
public will be impacted by service delays in: answering the 800#, 
filing new claims, making changes to their records, doing 
redeterminations, processing of appeals, processing of hearings and 
other critical workloads. Pending backlogs will grow causing further 
processing delays. It is critical that you restore the .38% cut to all 
agencies especially the $134 million to SSA for continuous improvement 
in public service.
    If you have any questions do not hesitate to contact me. I can be 
contacted at: P.0. Box 1954, Chicago, Illinois 60690. My telephone 
number is 312/575-6105 or by fax at 312/575-6031.

                                                EARL TUCKER
                                                          President
      

                                

                                                     March 29, 2000
Subcommittee on Social Security
c/o A.L. Singleton
Chief of Staff, Committee on Ways and Means
1102 Longworth House Office Building
Washington, D.C. 20515

Re: Social Security Disability Determination

    Dear Committee Members:

    The Social Security Administration (SSA) faces grave challenges in 
dealing the oncoming wave of baby boomer beneficiaries. They will be 
quite similar to the challenges that arose from the sharp rise in 
disability workloads during the early 1990's. The Hearing Process 
Improvement (HPI) initiative has been developed to help cope with this 
expected increase at the Office of Hearings and Appeals (OHA). I will 
not repeat my arguments regarding the pros and cons of this effort that 
I previously submitted to the Subcommittee last year. I know you have 
those letters on file and I respectfully ask that you review them in 
conjunction with this series of hearings.\1\ The arguments contained in 
those letters retain efficacy and the recommendations contained therein 
should be followed. Furthermore, Jim Hill of the National Treasury 
Employees Union, in his testimony, addressed many of the problems with 
HPI and I concur with his suggestions to reform that program.
---------------------------------------------------------------------------
    \1\ A copy of my March 1999 letter is attached for ease of 
reference.
---------------------------------------------------------------------------
    Today my emphasis is on two areas that HPI does not address, the 
recruitment of new attorneys for OHA and the recruitment and selection 
of new Administrative Law Judges (ALJ). The number of requests for 
hearing submitted to OHA has been relatively stable during the past few 
years and OHA's pending caseload has markedly decreased. It is 
ridiculous to believe that this condition will last much longer. SSA is 
going forward with the elimination of the reconsideration step. Even if 
it is assumed that redesign programs will increase the number of cases 
paid at the initial level to 35% from approximately 32% in 1997 and 
that the number of new claimants declined to two million, this would 
generate at least 650,000 appeals to OHA.\2\ In contrast, less than 
500,000 hearing requests were received in fiscal year 1999. Thus OHA 
will soon be facing at least a 30% workload increase, just as it is 
finally recovering from the boom in the early 1990's.
---------------------------------------------------------------------------
    \2\ I respectfully suggest a much greater increase in OHA workload 
will occur during the next few years. 700,000 hearing requests would 
not be an unreasonable figure.
---------------------------------------------------------------------------
    It has been several years since any entry level Attorney-Advisors 
have been hired. It has been even longer since any have been hired as 
permanent employees, without first being hired to a temporary 
appointment. I respectfully suggest that hiring a new class of 
attorneys is absolutely necessary to provide a continuing pool of 
applicants for the HPI Senior Attorney-Advisor positions, as well as 
Program Group Supervisor and Hearing Office Director positions.\3\ The 
current pool of Attorney-Advisors has been markedly shrinking. A number 
are being promoted into the HPI Senior Attorney-Advisor, Program Group 
Supervisor and Hearing Office Director positions A additional number of 
Attorney-Advisors, (most with several years of experience), who had 
been hired on temporary appointments were not renewed, in spite of the 
need for additional decision writers under HPI.\4\ Furthermore, many 
Attorney-Advisors are ``baby boomers'' and are approaching retirement 
themselves. Given the fact that the OHA workload is expected to 
markedly expand again, it should be obvious to everyone that recruiting 
new attorneys is necessary so that they will be trained and in place as 
the workload rises.
---------------------------------------------------------------------------
    \3\ Please refer to my prior correspondence such as my letter dated 
April 13, 1999, for my arguments discussing the importance of having 
employees with a legal education in these positions.
    \4\ SSA and OHA should be compelled to retain and make permanent 
the remaining Attorney-Advisors who are still in temporary status. The 
opportunity to retain experienced personnel should not be wasted.
---------------------------------------------------------------------------
    Similarly, there appear to be no plans on the horizon to hire any 
new Administrative Law Judges. There are currently less than 1100 ALJ's 
with OHA and this number has been steadily declining through attrition. 
Attrition logically is expected to increase among the current group as 
many of them are already over 65. It has been over three years since 
any new ALJ's have been selected. This number has been adequate to keep 
up with the current workload. It is ridiculous to believe that this 
shrinking corps will be able to keep up with the much greater workload 
that is certain to arrive in the next few years.\5\
---------------------------------------------------------------------------
    \5\ OPM, which processes ALJ applications and provides certificates 
of eligible candidates to agencies for selection, was recently ordered 
to overhaul its procedures in the case styled Azdell v. OPM. OPM should 
be strongly encouraged to settle this dispute promptly.
---------------------------------------------------------------------------
    As most of the witnesses pointed out, it takes years to develop a 
newly hired employee into a fully productive one. Please provide SSA 
the resources and guidance so that it recruits the necessary legal 
personnel to deal with the upcoming workloads now. Let us not repeat 
the crisis of the early 1990's where backlogs grew to intolerable 
levels.
    At the very least, I respectfully request that you schedule a 
follow-up hearing to focus on the clear need for additional legally-
trained personnel at SSA.

    Sincerely,

                                         James R. Hitchcock
                                                          President
      

                                

    [March 25, 1999 e-mail submission to the Subcommittee]
    SSA should make the Senior Attorney-Advisor program permanent and 
assure that it is integrated intact into the OHA reform plan; 2) assure 
the Senior Attorney-Advisor program is expanded as necessary to meet 
workload demands; and 3) hire more attorneys at local hearing offices 
to provide increased decision writing capacity.

    I am currently serving as a Senior Attorney-Advisor in Knoxville, 
Tennessee. I have previously served as an Attorney-Advisor in Memphis 
and Knoxville, Tennessee and as an Adjudication Officer (AO) in the 
West Des Moines, Iowa pilot site. Prior to my joining the Social 
Security Administration [SSA] I was in private practice for over six 
years.
    The Senior Attorney-Advisor program was designed to address the 
following issues, 1.) To ensure disability cases appealed to the Office 
of Hearings and Appeals [OHA] receive appropriate evidentiary 
development before hearing; and 2.) that in cases deserving an award 
on-the-record, legally sufficient and defensible written decisions are 
issued promptly.
    Review of the upcoming SSA workload, test results, and the state of 
the combined Federal and State workforces involved in disability 
determination, leads to the conclusion the public would be best served 
by expanding the Senior Attorney-Advisor program and making it 
permanent. Recent statistics have shown that Administrative Law Judge 
(ALJ) allowance rates have been dropping since the implementation of 
the program. There has been little change in the overall allowance 
rate.
    The Senior Attorney program has been effective in both expediting 
case development for cases that go to hearing and in issuing expedited 
favorable decisions. The Senior Attorney-Advisor program has thus 
helped reduce overall OHA processing time. It develops cases more 
efficiently and in a manner useful to the ALJs at OHA. Furthermore, it 
does not have a significant negative impact on the other workloads 
within the overall process.
    In my own experience during the original part-time Senior Attorney-
Advisor program I was able to complete review and preparation of a case 
as a Senior Attorney-Advisor much faster than I could as an AO. In 
addition, I still had enough time to draft a significant number of 
decisions for our ALJs. During the last eight months of my detail as an 
AO I processed [i.e. decided on-the-record or certified for hearing] 
approximately 136 cases. There were approximately 168 workdays during 
that period. I took about 16 days of leave during that period, leaving 
about 152 workdays. 136 divided by 152 = .89 cases per day [less than 
45% of the original 2 cases per day goal of the Disability Process 
Redesign]. This figure was on the high side of the national average for 
pilot AOs during that period. During the first eight full months since 
I returned to Knoxville as a Senior Attorney-Advisor, I processed 171 
Senior Attorney-Advisor cases in 165 workdays. Subtracting 16 leave 
days, three training days and three snow days left 143 workdays. 171 
divided by 143=1.20 cases per day [60% of the original 2 cases per day 
goal of the Disability Process Redesign]. This represents over a 34% 
increase in productivity compared an average AO! In addition to this I 
also drafted 82 ALJ decisions [about .57 a day]. It is my understanding 
that the average non-Senior Attorney-Advisor decision writer does not 
average much more than about one case per workday. Thus, the Social 
Security Administration effectively gained the production of over one 
half a decision writer and a third of an AO merely by converting me 
back to the role of part-time Senior Attorney-Advisor. I believe 
overall performance statistics will show that my performance as a 
Senior Attorney-Advisor is fairly typical.
    In July 1998, the new Senior Attorney-Advisor program began and my 
adjudicatory duties became full-time. Lack of cases to review has 
prevented me from reaching full productivity. However, during the first 
three months of the ``new'' program I still processed 150 cases in 63 
workdays. Subtracting 6 leave days left 57 workdays. 150 cases divided 
by 57=2.14 cases per day [better than the original 1996 target goal for 
the AO pilot offices]. Nationwide, during this same period, 285 Senior 
Attorney-Advisors reviewed almost 40,000 cases, issuing over 13,000 
decisions. Extrapolating these figures over a year yields over 52,000 
decisions and additional 160,000 case reviews [a total of about 212,000 
cases. This is a much higher production figure than that generated by a 
comparable number of AOs [300 AO's .9 cases decided or 
reviewed per day 5 days per week 52 weeks per year = 
70,200 cases decided or reviewed.
    The Senior Attorney-Advisor program accomplishes this level of 
productivity at little additional cost to the agency. It does not 
require large reallocations of personnel, significant retraining or 
capital expenditure. The program did not immediately meet its original 
ambitious goals. However, as the GAO reported part of that difficulty 
was caused by delays in startup. The program has had to overcome local 
resistance and workload imbalances. In any case, the above statistics 
show amazing and admirable productivity from a group that has been 
reduced from over 500 to approximately 250 people!
    Some people in OHA claim the Senior Attorney-Advisor program has 
had a negative impact on the capacity for writing ALJ decisions. This 
is an improper focus of concern. The productivity measure that is truly 
critical is the total number of well-reasoned decisions issued by OHA. 
The grade of the author of the decision is irrelevant as long as the 
decision is well reasoned and legally defensible. Senior Attorney-
Advisor decisions speed up the overall office processing of those cases 
by a factor of months. This eliminates the need for the costly hearing 
and post-hearing processing, freeing up personnel to work on other 
cases. Considering the overall workload, this more than makes up for 
slowing in the issuance of ALJ decisions by a few days. Furthermore, 
the evidence shows that overall office productivity is also improved by 
the expedited development initiated by Senior Attorney-Advisors in 
cases that go forward to the hearing. This reduces the need for 
rescheduling hearings, ordering post-hearing evidence and scheduling 
supplemental hearings, etc.
    Apparently, a decision has already been made to return current 
Senior Attorney-Advisors to drafting ALJ decisions on a part-time 
basis, in addition to their adjudicatory and case review duties. This 
results in a 25% reduction in the capacity for Senior Attorney review 
of cases. For the reasons discussed above, it is reasonable to expect 
that this change will result in an overall decline in productivity as 
the gains from increased decision writing capacity will not make up for 
the losses from reduced prehearing work. Thus, I recommend the Senior 
Attorney-Advisor program be expanded by at least 40 positions, with 
further expansion should workloads increase.
    A new proposal to overhaul the hearing office structure of the 
Office of Hearings and Appeals (OHA) has recently been developed. I 
believe that this proposal has potential to improve the efficiency of 
the process. However, I urge you to review the proposal and support its 
adoption, but ONLY with the clarifications and modifications suggested 
below.
    I believe that this plan, if implemented properly, will eventually 
go a long way to build on OHA's successes in reducing the huge backlog 
of the early 1990's. However, improper implementation will undercut 
those gains and rapidly take us back to the days of burgeoning 
backlogs.
    Disability determinations are subject to federal court review [42 
U.S.C. 405(g)] and must be legally defensible in order to withstand 
judicial scrutiny. The current incarnation of the Wright Workgroup 
initiative does not acknowledge that in order to make legally 
defensible determinations, all determinations must be made in 
compliance with the Act and Regulations (See, 20 CFR 404.1615 an 20 CFR 
416.1015), and that personnel with legal training are necessary to 
ensure such compliance. Instead, there are no positions in this plan 
that require any legal education in spite of the fact that the Case 
Analyst and Team Leader positions are both expected to adjudicate[on a 
part-time basis], the thousands of disability claims currently 
adjudicated by our Senior Attorney-Advisors.
    This decision ignores our very recent history. In particular it 
ignores lessons apparent from the failure of the Adjudication Officer 
pilots. There were many problems that lead to the failure of the AO 
program, but I believe two areas stand out. First was the lack of legal 
education and decision writing experience of the majority of AOs. This 
lead to an unacceptably high number of poor quality decisions. It took 
extensive remedial training, experience and the assignment of 
additional supervisors to improve the quality of AO decisions to 
tolerable levels. Second, there are many instances of poor relations 
with the representative community that further compromised the 
program's effectiveness.
    The Case Analyst and Team Leader proposals appear to open the door 
to the wholesale hiring/transferring/promoting of employees with no 
legal education and little or no legal writing experience. This is 
exactly the situation SSA had with the original AO pilots. It appears 
to set the stage to replace many attorneys with non-attorneys. This 
will be a terrible disservice to the public and OHA.
    Our prehearing adjudicators must have experience, education and 
ability to interact effectively with ALJs and claimant's 
representatives on a daily basis. They must have credibility with the 
representatives and the ALJs. Without this confidence the expected 
gains will not be realized. ALJs will not depend on under-qualified 
prehearing reviewers for adequate case development. They will spend 
more of their time on prehearing review. Claimant's representatives are 
unwilling to negotiate with people they perceive are lacking in 
independence. This was a significant problem with the Adjudication 
Officer program! Attorney-Advisors, with their professional standing, 
have the training, experience, self-confidence and independence to fill 
this role the way it is intended. There is no question that the Senior 
Attorney-Advisor program has been much better received by the 
representative community than the AO program. Replacing large numbers 
of Senior Attorney-Advisors with non-attorney case analysts will 
essentially recreate the flawed AO program within OHA.
    Selection of personnel for the adjudication position is critical. 
First and foremost, these positions involve critical ethical issues in 
the exercise of judicial/quasijudicial discretion. Requiring that the 
adjudication positions are filled by licensed professionals, bound by a 
uniform code of ethical conduct, is a NECESSARY safeguard for the 
integrity of the system and public confidence. Licensed attorneys are 
already bound by an established code of ethics, which provides for 
discipline in case of ethics violations. They have gone through a 
rigorous screening procedure in obtaining their license. In contrast, 
non-attorney personnel have no such licensing requirements are not 
bound by any code of ethical conduct. Discipline when one of these 
people yields to temptation will be much more difficult and limited.
    Furthermore, this adjudication position requires a person, who is 
not only familiar with disability issues, but is familiar with these 
issues in a legal context, as well as with the hearing process and 
higher levels of appeal. The prehearing adjudicator must also have the 
confidence and respect of the ALJs and claimant's representatives. 
Without these qualifications and abilities the prehearing review 
process could easily devolve into little more than a renamed version of 
the admittedly flawed ``reconsideration'' program. It would not 
accomplish the goals of identifying and expediting favorable decisions 
(especially those where an amended onset date might be appropriate, 
e.g. where negotiation with the claimant's representative is 
necessary), identifying needed development, and assuring that 
procedural aspects are appropriately addressed.
    The current Senior Attorney-Advisors are already performing the 
prehearing adjudication function that OHA needs and in most cases 
already have over three years of experience in adjudication and an 
additional three or more years in drafting decisions. Second, they are 
licensed attorneys. As licensed attorneys, they are bound by an 
established code of conduct and subject to discipline by their State's 
Board of Professional Responsibility. Third, the Attorney-Advisors have 
the familiarity with both the disability issues and the procedural 
requirements of the hearing process. They also are familiar with and 
understand the impact of the statutes, regulations, rulings, and 
pertinent caselaw. No one else in SSA, other than the Office of General 
Counsel, the ALJs and Appeals Council members and staff, has this full 
range of knowledge and experience. Other employees may have somewhat 
similar knowledge of the disability issues, but they lack the 
understanding of the procedural requirements and the legal issues 
involved. Furthermore, there are positions that are a much better fit 
for their qualifications and experience.
    The current Senior Attorney-Advisors and Attorney-Advisors have 
considerable experience in communicating/negotiating with other 
attorneys and claims representatives (through prior private practice 
experience and/or participation in prehearing conferences). Their legal 
training and proven negotiating abilities make them perfect for the 
prehearing adjudicator task of conferring and negotiating with the 
claimant's representatives.
    Finally, the Senior Attorney-Advisors and Attorney-Advisors already 
have experience in working closely with the ALJs. Attorney-Advisors are 
not mere decision writers. They confer with, make suggestions to, and 
assist the ALJs in reviewing cases before and after hearings. The level 
of this assistance varies from requesting clarification of an ALJ's 
instructions, to the situation where the ALJ requests counsel on a 
particular case or issue. Attorney-Advisors are often called on by ALJs 
to recommend a decision with minimal, if any, further instruction. 
Senior Attorney-Advisors and Attorney-Advisors have been assisting in 
training/mentoring newly hired ALJs.
    No one else in SSA has comparable experience in dealing with ALJs 
and claimant's representatives. For these reasons, it is clear that the 
prehearing adjudicator positions should be filled from the ranks of our 
current Senior Attorney-Advisors and Attorney-Advisors.
    I also wish to address the decision writing function of the Case 
Analysts and Team Leaders. Greater emphasis on training, both initially 
and on a continuing basis will be necessary for these writers. The 
district courts will not tolerate abbreviated decisions. The courts 
require thorough, well reasoned opinions, and the public deserves no 
less. Our current writers are already bearing the brunt of a much 
heavier and more complex workload than just a few years ago. A greater 
percentage of cases are unfavorable than in the earlier period. The 
current dip in case receipts will not last long. Soon more writers will 
be necessary and all writers will need and deserve rigorous training to 
help them deal with the much more onerous workload. Legal training and 
experience in legal and persuasive writing is more valuable than ever 
in dealing with this caseload. Entry level attorneys can be hired more 
cheaply [GS-9/11, step 1] than non-attorneys would be promoted [GS-11/
12 at a high step]. Anecdotal evidence suggests that all new writers 
need at least a year of experience to become proficient. Given this 
reality, there is no reason not to increase the hiring of attorneys to 
fill our decision writing vacancies.
    In conclusion, I encourage you to: 1) support making the Senior 
Attorney-Advisor program permanent and assure that it is integrated 
intact into the OHA reform plan; 2) assure the Senior Attorney-Advisor 
program is expanded as necessary to meet workload demands; and 3) that 
more attorneys are hired at local hearing offices to provide increased 
decision writing capacity.

            Sincerely,
                                         James R. Hitchcock
                                                          President
      

                                

Statement of Consortium for Citizens with Disabilities, Social Security 
Task Force

    The Consortium for Citizens with Disabilities Social 
Security Task Force appreciates the opportunity to comment on 
the readiness of the Social Security Administration to meet the 
needs of the impending wave of baby boomer beneficiaries.
    As the Subcommittee Hearing Advisory acknowledges, SSA 
workloads are projected to begin increasing rapidly within the 
next decade as the baby boom generation begins to reach its 
peak disability years just prior to reaching early retirement 
age beginning in 2008. In addition, the SSA workforce is also 
aging and will begin to lose significant numbers of staff, 
including senior and leadership staff. About 3,000 employees 
are expected to retire per year from 2007 through 2009. 
Finally, SSA is also taking on new or more complex 
responsibilities such as providing increased rehabilitation and 
employment services for people with disabilities, completing 
and maintaining an appropriate schedule of continuing 
disability reviews (CDRs) and other eligibility reviews, and 
new approaches to prevent fraud and abuse.
    In FY 1985, SSA's staffing levels were measured at 80,844 
FTEs and 83,406 workyears. The estimates for FY 2000 include 
63,350 FTEs and 65,203 workyears, for a reduction of 17,494 
FTEs and 18,203 workyears over the last 15 years.
    The CCD Social Security Task Force has voiced concern for 
some time over the continued long-term downsizing of the SSA 
workforce. We believe that failure to conduct appropriate and 
timely CDRs and other eligibility reviews could lead to 
decreased trust in the integrity of the Social Security and SSI 
programs. In addition, the new efforts to assist people with 
disabilities to go to work, through the Ticket to Work and Work 
Incentives Improvement Act of 1999, will require new and 
expanded approaches for SSA interaction with beneficiaries. 
Adequate staffing levels are critical for these and other 
efforts to be successful, especially given the coming 
disability and retirement years of baby boomers.
    For these reasons, the CCD Social Security Task Force 
strongly supports the proposal that the Social Security 
Administration's Limitation on Administrative Expenses (LAE) 
budget authority should be removed from the domestic 
discretionary spending category. While SSA's LAE account is 
categorized as discretionary spending, the Social Security 
program is considered off-budget and the OASDI portion of the 
LAE is also considered off-budget when calculating the overall 
budget surplus or deficit. Both the OASDI and SSI programs that 
SSA administers are considered as mandatory spending. Yet under 
current law, the entire LAE is considered under the domestic 
discretionary budget cap. The independent, bipartisan Social 
Security Advisory Board has unanimously urged that SSA's 
``administrative budget, like its program budget, be explicitly 
excluded from the statutory cap that imposes an arbitrary limit 
on the amount of discretionary government spending.'' 
(Testimony of the Honorable Stanford Ross, Chair, Social 
Security Advisory Board, February 10, 2000)
    The CCD Task Force believes that the entire LAE should be 
removed from under the domestic discretionary spending caps so 
that SSA's administrative functions can continue to operate 
smoothly for beneficiaries. For instance, SSA should have no 
artificial constraints in continuing to be able to take a 
single individual's applications for Social Security, Medicare, 
and SSI.
    It is important to note that even if the LAE were removed 
from the domestic discretionary caps, SSA's LAE would still be 
subject to the annual appropriations process and Congressional 
oversight. Currently, SSA's administrative expenses total less 
than 2% of benefit payments paid annually. Congress would still 
maintain its role in ensuring continued administrative 
efficiency.
    Most importantly, removal of the LAE from the domestic 
discretionary spending caps would remove it from competition 
with other programs for limited funds. It would allow for 
growth that is necessary to meet the needs of the coming baby-
boomer retirement years (including the retirement of SSA and 
state DDS personnel); continue the efforts to improve the 
processing time for initial applications and appeals; and 
continue the efforts to ensure integrity in the program through 
CDRs and other redeterminations. The President's budget request 
for FY 2001 includes a healthy 5 percent increase in the LAE. 
Yet due to increasing workloads, even with such increases, 
performance rates are expected to decline in the following 
areas: the 5-minute access rate to the 800 number; number of 
initial disability decisions pending; the number of hearings 
processed; and the number of CDRs processed.
    Annually, the Appropriations Committees need to have the 
ability to approve adequate funds for the administration of the 
Social Security programs without weakening other human services 
programs. Without removal of LAE from the discretionary caps, 
any increases in SSA staffing and DDS funding will have to be 
offset by reductions in other health, education, and human 
needs programs. It is critical that SSA be allowed to make 
necessary investments in building the staffing infrastructure 
necessary to meet the needs of the population, as well as new 
statutory responsibilities such as the Ticket to Work and Work 
Incentives Improvement Act.
    The CCD Task Force on Social Security urges the Ways and 
Means Committee and the Subcommittee on Social Security to 
support efforts to remove SSA's LAE from the domestic 
discretionary spending caps.
    If you have any questions on this statement, please contact 
Marty Ford at The Arc, 202-785-3388.
    ON BEHALF OF:
    Adapted Physical Activity Council
    American Association on Mental Retardation
    American Network of Community Options and Resources
    Association for Persons in Supported Employment
    Brain Injury Association
    Inter-National Association of Business, Industry and 
Rehabilitation
    International Association of Psychosocial Rehabilitation 
Services
    National Association of Developmental Disabilities Councils
    National Mental Health Association
    National Organization of Social Security Claimants' 
Representatives
    NISH
    Paralyzed Veterans of America
    Research Institute for Independent Living
    The Arc of the United States
    Title II Community AIDS National Network
    United Cerebral Palsy Associations, Inc.
      

                                

Statement of Nancy G. Shor, Executive Director, National Organization 
of Social Security Claimants' Representatives

    This statement is submitted on behalf of the National 
Organization of Social Security Claimants' Representatives 
(NOSSCR).
    For the past twenty years, I have been the NOSSCR Executive 
Director. NOSSCR's current membership is approximately 3,450 
attorneys and others from across the country who represent 
claimants for Social Security and Supplemental Security Income 
benefits. Collectively, we have many years of experience in 
representing claimants at every level of the administrative and 
judicial process.
    NOSSCR is concerned about SSA's readiness to deal with the 
impending increase in its workload as the ``baby boom'' 
generation approaches the peak age for onset of disability and, 
subsequently, retirement. Testimony at the Subcommittee 
hearings on February 10 and March 16, 2000, painted a bleak 
picture regarding SSA's ability to deal with the increased 
work, at the same time that its own workforce will reach peak 
retirement numbers. To exacerbate this problem, SSA's budget 
continues to be cut from levels that would allow it to 
adequately address current and future service delivery needs.

SSA's ABILITY TO MEET SERVICE DELIVERY NEEDS

    Most cases handled by NOSSCR members are at the hearing or 
Appeals Council level. While current processing times at most 
Offices of Hearings and Appeals are decreasing, they are still 
unacceptably high. Delays at the Appeals Council level are far 
worse with, according to SSA, an average processing time of 460 
days in FY 1999. In fact, many of our members report far longer 
times -frequently up to two years from the time the appeal is 
filed. A claimant cannot proceed with an appeal in federal 
district court until the Appeals Council has acted. Thus, while 
their medical and financial situations are deteriorating, 
claimants are forced to wait for many months before receiving a 
decision.
    Given these lengthy waits at the administrative appeals 
levels, NOSSCR strongly believes in strengthening the front end 
of the process. The benefit is obvious: the earlier a claim is 
adequately developed, the earlier it can be correctly decided. 
To address this, SSA needs to emphasize the full development of 
the record at the beginning of the claim. Unfortunately, NOSSCR 
members report that files for claimants with reconsideration 
level denials show that, all too often, the development of the 
claim was inadequate. Until this lack of development is 
addressed, the correct decision on the claim cannot be made. 
Claimants are denied not because the evidence establishes that 
the person is not disabled, but because the limited evidence 
gathered cannot establish that the person is disabled.
    To improve these problems facing claimants, SSA requires 
adequate staffing and resources. However, NOSSCR is extremely 
concerned about SSA's ability to meet current and future 
service needs. The President's proposed SSA budget for fiscal 
year 2001 provides for fewer ``workyears'' and indicates that 
backlogs will begin to grow again at the initial application 
level. As indicated at the March 16 hearing, SSA's work force 
has been reduced by nearly 22 percent since 1985. The 
Commissioner testified how he is forced to shift resources to 
meet new statutory obligations and to deal with particularly 
intolerable situations, such as the current state of affairs at 
the Appeals Council.
    The September 1999 report of the Social Security Advisory 
Board echoes these concerns. It notes the ``major decline'' in 
the size of the agency's workforce at the same time that it has 
``significant problems'' in meeting its current workload 
requirements. ``As the workload grows, these problems threaten 
to become far more serious in the future.''

SSA REQUIRES ADEQUATE RESOURCES TO MEET CURRENT AND FUTURE 
SERVICE NEEDS

    NOSSCR strongly agrees with the Social Security Advisory 
Board's unanimous and bipartisan recommendation that SSA's 
administrative budget, like its program budget, be removed from 
the discretionary domestic spending caps. This would allow 
Congress to approve funding for SSA that would permit the 
agency to address current service delivery needs and planning 
for the future.
    Currently, SSA's expenses amount to less than 2 percent of 
annual benefit payments, a figure substantially below that of 
private insurers. Wage-earners pay Social Security taxes with 
an expectation that the program will be properly administered 
at an adequate level of funding. SSA's administrative budget 
should not be forced to fit within an arbitrary level to fit 
within discretionary spending caps, forcing it to compete with 
other domestic programs for limited funds.
    As noted by the Board, removing SSA's budget from 
discretionary domestic spending caps would not lead to 
unrestrained spending by the agency. The budget would still be 
subject to the annual appropriations process and Congressional 
oversight.
    If you have any questions regarding this statement, please 
contact Ethel Zelenske, Director of Government Affairs, NOSSCR, 
(202) 216-0030.
      

                                

                                                     March 29, 2000

    Dear Members of the House Ways and Means Committee:

    Below is the text of a letter I wrote to Honorable Olympia J. 
Snowe, Honorable Susan Collins, Honorable Tom Allen, Honorable John 
Baldacci, and to Honorable E. Clay Shaw, Jr. on February 18, 2000. The 
letter relates to ongoing problems in the Portland, Maine Office of 
Hearings and Appeals, Social Security Administration--problems that I 
believe have been poorly addressed by the Agency. It is noteworthy 
that, despite recent and past events, the Portland Office of Hearings 
and Appeals has always been referred to as the best office in the 
region, and often the nation, in quality and production. Offices within 
and outside of Region I have relied upon the Portland Office of 
Hearings and Appeals to assist in reducing their increasingly high 
workloads. Management's failure to deal with these problems has had a 
negative effect not only on the employees, but the claimants which we 
serve, YOUR constituents. The office has functioned at a progressively 
decreasing level of efficiency.

    By way of background, I have set out below a brief chronology of 
events, which led up to the writing of this letter.

    --Over a period of many years Portland OFFICE OF HEARINGS AND 
APPEALS employees are subjected to treatment by their Hearing Office 
Manager, which they characterize as including:
    --harassment
    --shouting, screaming and yelling at employees
    --making unfounded accusations against employees
    --slamming doors
    --declining to permit employees to contact the regional personnel 
office;
    --telling the Hearing Office Chief ADMINISTRATIVE LAW JUDGE to shut 
up and go back to his office (in the presence of employees)
    --preventing a worker from filing a workers' compensation claim
    --requesting that certain employees act as ``informants,'' and 
report to her the conduct of other employees
    --accusing employees of meddling and not minding their own business
    --throwing objects
    --directing employees to sign backdated performance appraisal forms
    --misdirection of union mail
    --criticizing employees' attempts to involve the union
    --ordering employees not to associate with other employees
    --telling employees not to speak to certain other employees
    --accusing bargaining unit members of spying on her
    --reprimanding bargaining unit members for speaking to agency 
officials from outside the office
    --rebuking bargaining unit members in the presence of third parties
    --yelling at bargaining unit members in the presence of third 
parties
    --crying in the presence of bargaining unit members
    --numerous paranoid statements
    --Dates uncertain: The Regional Chief Administrative Law Judge and 
the Regional Management Officer for the Office of Hearings and Appeals 
in Region I met with the Portland Office of Hearings and Appeals on two 
or more occasions, are said to be ``horrified'' at what they hear, and 
promise to remedy it. The Regional Management Officer acknowledges 
these problems and promises to correct them. He discourages the filing 
of grievances, assuring workers that he will take care of everything. 
On the later visit he apologizes for not taking action. He once again 
promises to do whatever is necessary.
    June, 1999: Judge Katherine Morgan is appointed Hearing Office 
Chief Administrative Law Judge in the Portland, Maine Office of 
Hearings and Appeals office.
    Late summer or fall of 1999: Although nothing changes, bargaining 
unit members learn that the Regional Office had approved a cash award 
of $1000 or more for the Hearing Office Manager.
    --October 22, 1999: The Hearing Office Manager is escorted from the 
office by two security personnel after engaging in activity that is 
alleged to have included shouting, slamming of objects, rudeness, 
threatening, irrational behavior, and emotional volatility. Principal 
witnesses Cristin Wickham and Hearing Office Chief Administrative Law 
Judge Katherine Morgan. Employees are allowed to leave the premises for 
their own safety. Some employees are frightened by her conduct. The 
Hearing Office Manager is apparently placed on administrative leave by 
Judge Morgan.
    --October 24, 1999: Judge Anderson becomes Regional Chief 
Administrative Law Judge for Region I. The Regional Management Office 
subsequently details the Hearing Office Manager to the Regional Office 
for a period of time, and then apparently extends her period of 
administrative leave indefinitely.
    --October 28, 1999: AFGE Local 1164 files a union-management 
grievance, arising out of conduct of the Hearing Office Manager on 
October 22.
    --November 8, 1999: A meeting with regional office management 
occurs in the large hearing room at Office of Hearings and Appeals 
Portland. All staff who were at work that day are summoned to this 
meeting. Mr. Sapienza, the Regional Management Officer, and Judge 
Anderson, the Regional Chief Administrative Law Judge, announce to the 
bargaining unit members that the Hearing Office Manager will be 
returning to the Portland Office of Hearings and Appeals office 
forthwith. Judge Anderson denies knowledge of the grievance, although 
Judge Morgan has already personally given him a copy of it and has 
discussed it with him. Judge Anderson tells the staff that, ``[the 
Hearing Office Manager] is coming back.'' He claims that he has no 
reason to believe he has the authority to divest her of supervisory 
authority; that he has no reason to believe he has the authority to 
detail her elsewhere; that he could not force her to undergo a fitness 
for duty exam; that because past Regional Chief Administrative Law 
Judges had not seen fit to deal with the Hearing Office Manager's past 
conduct, he is powerless to investigate it or to deal with it now; that 
the Hearing Office Chief Judge Katherine Morgan will have full 
authority to issue discipline to the Hearing Office Manager for any 
future misconduct; that ``Your Hearing Office Chief Administrative Law 
Judge can take whatever action she deems necessary"; that upon the 
Hearing Office Manager's return, Regional Office personnel will be in 
place in the office one or two days per week; and that ``[the Hearing 
Office Manager] has rights,'' including the right to modify her past 
conduct. Judge Anderson urges the filing of future grievances should 
any additional abuse or intimidation occur. He states that this appears 
to be the sole available remedy. He states, ``You can help me by filing 
grievances now.'' Nevertheless he insists that the past complaints had 
``not reached the Regional Office.'' Mr. Sapienza denies having 
discouraged bargaining unit members from filing grievances. He takes 
the position that he is now powerless to do anything about the Hearing 
Office Manager 's past conduct, because no grievances had been filed in 
the past. He maintains that he had kept no records of the past employee 
complaints. He states that there were no records in Boston that 
reflected that the Hearing Office Manager had ever been given notice of 
any inappropriate conduct on her part and an opportunity to correct 
that conduct. The bargaining unit members express concerns about the 
Hearing Office Manager's alleged abuse of time and leave (but are 
informed that this cannot be looked into); about fear of future 
intimidation and retaliation; about fear of working in close proximity 
to her; about unwillingness to be supervised by her; about her 
potential for violence; and about past threats of vengeance. Judge 
Anderson listens to these concerns and agrees that the bargaining unit 
members will get ample notice of her return and further agrees to put a 
second security guard inside the office. He concedes that he is aware 
that she is ``trouble'' and ``bad news.''
    --November 9, 1999: Judge Anderson meets with the union concerning 
the grievance. All negotiations between the union and management 
officials apparently take place prior to Wednesday, November 16, 1999. 
There are apparently three meetings in all.
    --November 15, 1999: The union informs employees that it has met 
with Mr. Sapienza and Judge Anderson concerning the grievance. The 
Hearing Office Manager is to remain out of the office indefinitely. The 
union is advised by Anderson and Sapienza that, when and if the Hearing 
Office Manager returns, they will provide sufficient notice to prepare 
the office.
    --November 29, 1999: Judge Anderson informs the union by e-mail at 
12:29 that the Hearing Office Manager will be returning to Office of 
Hearings and Appeals Portland on the following day.
    --November 30, 1999: For a period of two hours, immediately prior 
to the Hearing Office Manager's return to the office, Jim Landrum and 
B. J. Thomas of the Office of the Chief Administrative Law Judge meet 
with the Portland Office of Hearings and Appeals staff in the large 
hearing room at Office of Hearings and Appeals Portland. All staff who 
are at work that day are summoned to this meeting. No answer to the 
grievance has been given by management. Landrum and Thomas acknowledge 
that there are ``problems with [the Hearing Office Manager].'' Thomas 
suggests that whatever has happened in the past, the bargaining unit 
members should make peace with it and go on from here. Ms. Thomas says 
she believes that the Hearing Office Manager will change and that it 
would be unfair not to give her a chance to change. Mr. Landrum says 
that she will not be ``tossed'' without being given a chance to 
improve. They acknowledge that the employees have a right to work in an 
environment free of hostility. They take the position that management 
does indeed have authority to continue the Hearing Office Manager on 
administrative leave, but that management has exercised its discretion 
not to do so. They will not say whether the Hearing Office Manager had 
been ``written up'' for her past conduct. They state that it was 
management's opinion that the bargaining unit members are not at risk, 
but decline to say how this determination has been made. They ask if 
the Hearing Office Manager has actually touched anyone. Mr. Landrum 
states that there has to be three months of intensive training and 
another three months on a performance improvement plan before anything 
can be done. They state that a fitness for duty exam cannot be ordered 
unless a person had actually been violent; that the Regional Chief 
Administrative Law Judge has given his verbal agreement to Hearing 
Office Chief Administrative Law Judge Morgan to work with her; and that 
none of her authority would be interfered with. They promise support 
and training to the staff. They promise a course on how to deal with 
difficult people. They promise that an investigation of the hearing 
Office Manager 's past conduct will be undertaken. They state that 
Judge Anderson will also be looking into the question of Regional 
Office management's failure to deal with the problem in the past. Mr. 
Landrum states that management had failed to deal with the problem 
appropriately. They state that they believe that the office needs an 
additional security guard. They concede that the union may not have 
been given timely notice that the hearing Office Manager would be 
returning this day. They promise that they will be returning to provide 
training.
    --November 30, 1999: The Hearing Office Manager returns to the 
office. An additional security guard arrives and is stationed outside 
her office. Additional grievances are later filed relating to her 
conduct before and after October 22. Several days later the second 
security guard is removed from inside the office to the public area of 
the office, without notice to the union.
    --January 6, 2000: The Hearing Office Manager agrees to step down 
from a supervisory position and is immediately thereafter reassigned to 
a non-supervisory position. Judge Morgan is removed from the Hearing 
Office Chief Administrative Law Judge position over the strenuous 
objections of virtually all of the employees. Her removal is widely 
believed to be the result of her attempts to discipline and remove the 
Hearing Office Manager.
    --January 12, 2000: In spite of having been removed from the 
position of Hearing Office Manager, the former Hearing Office Manager 
is nevertheless permitted to have unlimited, and possibly exclusive, 
access to the personnel files of the Portland Hearing Office, which 
files are housed in a filing cabinet in her office.
    --January 6, 2000 to January 12, 2000: The former Hearing Office 
Manager is observed by bargaining unit members to be shredding and 
photocopying documents, some of which are apparently documents she had 
removed from employee personnel folders in the Portland Hearing Office.
    --January 12, 2000: The union requests that her access to the 
office personnel files be terminated immediately, that management 
immediately take possession of any other administrative files in her 
custody which contained any personnel information or documents, and 
that management insist upon reviewing any materials that she proposes 
to shred in the future. The union stresses that there are pending 
grievances relating to her alleged maintenance of unauthorized 
personnel records and that it was entirely inappropriate for her to 
have continued access to office personnel records. Approximately an 
hour after the meeting referred to above, she is intercepted by 
bargaining unit employees as she is completing the shredding of some 
personnel documents relating to a number of agency employees. 
Management later indicates that it will refuse to investigate this 
matter.
    The grievance referred to above was essentially denied by 
management. Management's actions in dealing with the events outlined 
above caused a great deal of anger and a great diminution of morale on 
the part of office employees. My letter to you and to the others named 
above was in response to a letter she received from Judge Anderson, in 
which he set out management's point of view on these events.
    In addition to the above-mentioned grievance, there are presently 
three unfair labor practices pending with the Federal Labor Relations 
Authority, several individual grievances filed by staff, including 
three which I have pending, a very serious investigation by an outside 
agency, and numerous EEO complaints.
    As a footnote, I would like to add that, as of May 8, 2000, I will 
be leaving this agency to pursue a position with the Internal Revenue 
Service, in Washington D.C. I will be available at (207) 780-3271 until 
April 28, 2000, for any questions, concerns, or otherwise. After that 
date, you may contact E. James Skillings, Esq., at the same number, for 
an updated telephone number. I will be at your disposal for any further 
information, and would be willing to testify at any upcoming hearings 
which might be scheduled in the future.

                                           Cristin, Wickham
      

                                

                                                  February 18, 2000
Honorable Olympia J. Snowe
United States Senator
Two Great Falls Plaza
Auburn, ME 04210

    Dear Senator Snowe:

    Pursuant to a telephone conversation with Denise in your office, I 
was faxed some material relating to the inquiry I initiated with your 
office, namely a letter from Thurman Anderson, Regional Chief 
Administrative Law Judge. The following is a compiled response from me 
and from other staff members in the office for your clarification. We 
feel that Judge Anderson may be ``padding'' the situation, to look more 
favorable to him. I would like to request that you make a further 
inquiry into this matter, but would prefer that you follow through with 
this at either Commissioner Kenneth Apfel's office or Associate 
Commissioner Rita Geier. It serves no purpose to inquire through Kurt 
Szarnoski, as he forwards the information to Judge Anderson, who is in 
the middle of the situation. The letters stop there, and nothing 
further is accomplished.
    Judge Anderson states in his letter that he issued a response to 
the grievance filed by the union on behalf of the Portland Hearing 
Office on December 29, 1999. Subsequent to receipt of this response, I 
drafted a letter to you, outlining some of the concerns I had with 
Judge Anderson's response (copy attached). Several of the items 
mentioned in said letter are again mentioned in his most recent January 
31, 2000 letter. He addresses the items as action being taken, which is 
not the case.
    Judge Anderson states that he ``approved a request for reassignment 
from the Hearing Office Manager to a non-management position.'' It is 
unclear whether this was a temporary reassignment, as he calls it, or 
permanent. We have been unable to get any clarification on this issue, 
and feel it is important to our safety.
    Judge Anderson states that on January 6, 2000, he ``took over as 
the Acting Hearing Office Chief Administrative Law Judge of the 
Portland Hearing Office.'' It is obviously unclear to anybody, in 
reading the letter, as to why he took over. He did not indicate that 
the then-permanent Hearing Office Chief Administrative Law Judge 
Katherine Morgan, was removed on the same day after refusing to step 
down. He also failed to indicate the reasons why he removed her from 
this position. In an extremely short staff meeting (which I have also 
pointed out below) Judge Anderson indicated that, due to problems in 
the Portland Hearing Office, in particular with the management team, he 
was removing Judge Morgan from her position, and he would take over as 
Acting Chief Administrative Law Judge. He neglected to mention that one 
of the reasons for removing her was that he could not get along with 
her. Judge Morgan was the only person in the office who was protecting 
us from the arbitrary and abusive use of power by the Hearing Office 
Manager and also by Judge Anderson, the Regional Chief Administrative 
Law Judge, who had previously supported the Hearing Office Manager by 
restoring her to her position without any investigation whatsoever.
    I would like to point out an incident on that same day, January 6, 
2000, when Judge Anderson convened a meeting to announce the news to 
the office. It is noteworthy that this meeting was called at a time 
when the majority of the staff was at lunch, and less than half of the 
staff was present. At this meeting, he made his announcement. I then 
asked if questions were permitted. He stated that I ``could ask a 
question, but . . .'' I proceeded to ask my question. In the middle of 
my sentence, he stood up from his chair, looked at his colleague, Al 
Sapienza, and walked out of the room. I subsequently filed a grievance 
against Judge Anderson for violating the National Agreement, Article 3, 
Section 2, Part A, which states, ``in the interest of maintaining a 
congenial work environment, both supervisors and employees will deal 
with each other in a professional manner and with courtesy, dignity, 
and respect.'' Judge Anderson himself refers to this in his grievance 
response of December 29, 1999, page 3, paragraph 2. What kind of 
example is he setting when he refers to these rules, and then violates 
them vehemently?
    Judge Anderson states that ``the Employee Assistance Program has 
been contacted to set up some workshops in the Portland Hearing 
Office.'' He also states that acting HOM Gillis is working with the 
union steward and EAP on setting this up. When approached with this 
question, our union steward, Suzanne Jeffers, stated she was not aware 
of this. On behalf of the bargaining unit employees, she requested said 
information from acting HOM Gillis, to which she stated that she was 
aware of something happening, but was not sure what. It is interesting 
to note that a telephone call was placed to the director of the 
Employee Assistance Program shortly after this incident occurred in 
October 1999. I inquired as to whether the Program could send a 
representative to our office to speak with us as a group and assist in 
dealing with the issues at hand. I was advised that the employees could 
call the hotline to speak with somebody individually, and if needed, 
seek individual counseling services. The director stated that his 
establishment would not be able to accommodate our request, as this was 
a labor-management issue, and they prefer not to get involved with 
issues like that. He again reiterated that employees could call the 
hotline at anytime. I would request that you contact Ms. Gillis 
directly at (207) 780-3271 to inquire as to what methods are in place 
and when these workshops might take place.
    Judge Anderson states that he is taking steps and has posted 
announcements for the vacant positions of Hearing Office Chief 
Administrative Law Judge and Hearing Office Director, which is the new 
position replacing the HOM in the new HPI (Hearings Process Improvement 
Initiative). The Portland Hearing Office is not scheduled to begin the 
new HPI plan until Phase II, which is October 2000. The question which 
comes to mind is why would they post a HOD position if we have not even 
been implemented into the process yet? Will this position be filled 
before Phase II is implemented, and if so, what will the HOD do? 
Additionally, I would like to know if there are any other Phase II 
offices who have posted similar positions.
    One of our main concerns now is that Judge Anderson removed Judge 
Morgan from the Hearing Office Chief Administrative Law Judge position 
for failure to ``keep a lid on'' (his words) the situation in Portland. 
It is blindingly obvious to all of us that this was done solely in 
retaliation for her attempts to initiate an investigation into a long 
history of abuses of employees by management, and to correct those 
abuses. Judge Morgan was the only management official we have had here 
who was truly responsive to the collective needs of the staff. It is 
the consensus of the staff that she was unfairly and improperly removed 
and that she should be restored to the Hearing Office Chief 
Administrative Law Judge position. Additionally, we are concerned about 
the outrageous waste of taxpayer money by Judge Anderson. For several 
months, the government has been paying to house an Acting Hearing 
Office Manager in this area. Expenses, include hotel, meals, 
transportation, etc are being paid by the government, when there are 
many well-qualified individuals within this office who could perform 
the duties of Acting Hearing Office Manager.
    By way of illustration of the continuing nature of the problems we 
have had with Judge Anderson's manner of dealing with our concerns, I 
am enclosing a copy of a grievance that our union recently found it 
necessary to file. The grievance concerns the alleged shredding of 
personnel files of this office, by our former Hearing Office Manager, 
at a time when she should not even have been allowed access to those 
files. As nearly as we have been able to discern, Judge Anderson has 
displayed no interest whatsoever in this incident, even though it 
constitutes a serious violation of the privacy rights of staff members.
    We appreciate all the assistance you have given us, and continue to 
provide. As I stated above, we would prefer that you request assistance 
from either Commissioner Kenneth Apfel or Associate Commissioner Rita 
Geier in this matter. I am also forwarding a copy of this letter to 
Senator Susan Collins and to Congressmen John Baldacci and Tom Allen.
    As a final note, I have attached several statements written by 
employees in the office, who wish to have their views clearly stated in 
the record. I have also enclosed some additional information concerning 
grievances/complaints, which have been filed since October 1999.
    Thank you for all the time you have already devoted to this matter, 
and in advance, for your continued effort at assisting the Portland 
Hearing Office.

    Sincerely Yours,

                                         Cristin J. Wickham
                                            On behalf of myself and
                                            Employees listed below:
                                                     Susan Sullivan
                                                       Robin Gammon
                                                      Judie Couture
                                                        Linda Bruce
                                                       Ellen Munsey
                                                    Paula Fenderson
                                                      Jim Skillings
                                                    Suzanne Jeffers
                                                    Raymond Wallace
    Cc: Senator Susan Collins, Portland office
        Congressman John Baldacci, Lewiston office
        Congressman Tom Allen, Portland office
        Congressman E. Clay Shaw, Jr., Committee on Ways and Means for 
        Social Security Administration

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