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EXAMINING WAYS THE SOCIAL SECURITY ADMINISTRATION CAN IMPROVE THE DISABILITY REVIEW PROCESS 

HEARING 

BEFORE THE

SUBCOMMITTEE ON ENERGY POLICY, 

HEALTH CARE AND ENTITLEMENTS 

OF THE

COMMITTEE ON OVERSIGHT 

AND GOVERNMENT REFORM 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED THIRTEENTH CONGRESS 

SECOND SESSION 

APRIL 9, 2014 

Serial No. 113–104 

Printed for the use of the Committee on Oversight and Government Reform 

( 

Available via the World Wide Web: http://www.fdsys.gov 

http://www.house.gov/reform 

(II) 

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM 

DARRELL E. ISSA, California, Chairman 

JOHN L. MICA, Florida 

MICHAEL R. TURNER, Ohio 

JOHN J. DUNCAN, JR., Tennessee 

PATRICK T. MCHENRY, North Carolina 

JIM JORDAN, Ohio 

JASON CHAFFETZ, Utah 

TIM WALBERG, Michigan 

JAMES LANKFORD, Oklahoma 

JUSTIN AMASH, Michigan 

PAUL A. GOSAR, Arizona 

PATRICK MEEHAN, Pennsylvania 

SCOTT DESJARLAIS, Tennessee 

TREY GOWDY, South Carolina 

BLAKE FARENTHOLD, Texas 

DOC HASTINGS, Washington 

CYNTHIA M. LUMMIS, Wyoming 

ROB WOODALL, Georgia 

THOMAS MASSIE, Kentucky 

DOUG COLLINS, Georgia 

MARK MEADOWS, North Carolina 

KERRY L. BENTIVOLIO, Michigan 

RON DESANTIS, Florida 

ELIJAH E. CUMMINGS, Maryland, Ranking 

Minority Member 

CAROLYN B. MALONEY, New York 

ELEANOR HOLMES NORTON, District of 

Columbia 

JOHN F. TIERNEY, Massachusetts 

WM. LACY CLAY, Missouri 

STEPHEN F. LYNCH, Massachusetts 

JIM COOPER, Tennessee 

GERALD E. CONNOLLY, Virginia 

JACKIE SPEIER, California 

MATTHEW A. CARTWRIGHT, Pennsylvania 

TAMMY DUCKWORTH, Illinois 

ROBIN L. KELLY, Illinois 

DANNY K. DAVIS, Illinois 

PETER WELCH, Vermont 

TONY CARDENAS, California 

STEVEN A. HORSFORD, Nevada 

MICHELLE LUJAN GRISHAM, New Mexico 

Vacancy 

LAWRENCE J. BRADY, Staff Director 

JOHN D. CUADERES, Deputy Staff Director 

STEPHEN CASTOR, General Counsel 

LINDA A. GOOD, Chief Clerk 

DAVID RAPALLO, Minority Staff Director 

SUBCOMMITTEE ON ENERGY POLICY, HEALTH CARE AND ENTITLEMENTS

JAMES LANKFORD, Oklahoma, Chairman 

PATRICK T. MCHENRY, North Carolina 

PAUL GOSAR, Arizona 

JIM JORDAN, Ohio 

JASON CHAFFETZ, Utah 

TIM WALBERG, Michigan 

PATRICK MEEHAN, Pennsylvania 

SCOTT DESJARLAIS, Tennessee 

BLAKE FARENTHOLD, Texas 

DOC HASTINGS, Washington 

ROB WOODALL, Georgia 

THOMAS MASSIE, Kentucky 

JACKIE SPEIER, California, Ranking 

Minority Member 

ELEANOR HOLMES NORTON, District of 

Columbia 

JIM COOPER, Tennessee 

MATTHEW CARTWRIGHT, Pennsylvania 

TAMMY DUCKWORTH, Illinois 

DANNY K. DAVIS, Illinois 

TONY CARDENAS, California 

STEVEN A. HORSFORD, Nevada 

MICHELLE LUJAN GRISHAM, New Mexico 

(III) 

C O N T E N T S 

Page 

Hearing held on April 9, 2014 ................................................................................ 1 

WITNESSES 

Mr. Daniel Bertoni, Director, Education, Workforce and Income Security, 

U.S. Government Accountability Office 

Oral Statement ................................................................................................. 6 

Written Statement ............................................................................................ 8 

Ms. Jennifer Nottingham, President, National Association of Disability Examiners 

Oral Statement ................................................................................................. 23 

Written Statement ............................................................................................ 25 

Ms. Marianna Lacanfora, Acting Deputy Commissioner, Retirement and Disability Policy, Social Security Administration 

Oral Statement ................................................................................................. 36 

Written Statement ............................................................................................ 38 

Ms. Jennifer Shaw Lockhart, State Director, Sooner Success, The University 

of Oklahoma Health Sciences Center 

Oral Statement ................................................................................................. 47 

Written Statement ............................................................................................ 50 

Mr. Patrick P. O’Carroll, Jr., Inspector General, Social Security Administration 

Oral Statement ................................................................................................. 68 

Written Statement ............................................................................................ 70 

APPENDIX 

Entered into record by Chairman Lankford: Letter to Carolyn Colvin, SSA 

Acting Commissioner from Chairman Lankford & Ranking Member Speier . 114 

(1) 

EXAMINING WAYS THE SOCIAL SECURITY ADMINISTRATION CAN IMPROVE THE DISABILITY REVIEW PROCESS 

Wednesday, April 9, 2014, 

HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON ENERGY POLICY, HEALTH CARE & 

ENTITLEMENTS, 

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM, 

Washington, D.C. 

The subcommittee met, pursuant to call, at 1:37 p.m., in Room 

2154, Rayburn House Office Building, Hon. James Lankford [chairman of the subcommittee] presiding. 

Present: Representatives Lankford, Walberg, Massie, Speier, 

Cartwright, Duckworth, Lujan Grisham, Horsford, Cummings, and 

Woodall. 

Staff Present: Melissa Beaumont, Majority Assistant Clerk; 

Brian Blase, Majority Senior Professional Staff Member; Will L. 

Boyington, Majority Deputy Press Secretary; John Cuaderes, Majority Deputy Staff Director; Adam P. Fromm, Majority Director of 

Member Services and Committee Operations; Linda Good, Majority 

Chief Clerk; Mitchell S. Kominsky, Majority Counsel; Mark D. 

Marin, Majority Deputy Staff Director for Oversight; Emily Martin, 

Majority Counsel; Ashok M. Pinto, Majority Chief Counsel, Investigations; Jessica Seale, Majority Digital Director; Katy Summerlin, 

Majority Press Assistant; Sharon Meredith Utz, Majority Professional Staff Member; Jaron Bourke, Minority Director of Administration; Courtney Cochran, Minority Press Secretary; Devon Hill, 

Minority Research Assistant; Suzanne Owen, Minority Senior Policy Advisor; and Brian Quinn, Minority Counsel. 

Mr. LANKFORD. Good afternoon. The committee will come to 

order. 

I would like to begin this hearing by stating the Oversight Committee mission statement. 

We exist to secure two fundamental principles: first, that Americans have the right to know what Washington takes from them is 

well spent; second, Americans deserve an efficient, effective Government that works for them. Our duty on the Oversight and Government Reform Committee is to protect these rights. 

Our solemn responsibility is to hold Government accountable to 

taxpayers, because taxpayers have the right to know what they will 

get from their Government. We will work tirelessly in partnership 

with citizen watchdogs to deliver the facts to the American people 

2 

and bring genuine reform to the Federal bureaucracy. This is the 

mission of the Oversight and Government Reform Committee. 

I will do a quick opening statement. 

The Social Security Administration oversees two large Federal 

disability programs: the Social Security Disability Insurance Program and the Supplemental Security Income Program. Both have 

grown rapidly over the last 25 years. The growth is unsustainable. 

It also poses a threat to the truly disabled, who are often pushed 

to the back of the line and face large benefit cuts in the future. 

In the vast majority of cases, a decision to allow benefits is an 

irrevocable commitment of taxpayer funds since favorable decisions 

are not usually appealed. Unfortunately, the growth in these programs has limited some people from reaching their full potential, 

and in many cases a program that was intended to fight poverty 

is perpetuating poverty. 

According to a 2010 paper published jointly by the liberal Center 

for American Progress and the left-of-center Brookings Institution 

said SSDI is ineffective in assisting workers with disabilities to 

reach their employment potential or to maintain economic self-sufficiency. Instead, the program provides a strong incentive to applicants and beneficiaries to remain permanently out of the labor 

force. 

I welcome the testimony of Jennifer Lockhart today—thank you 

for being here—a fellow Oklahoman, who has both personal and 

professional experience assisting children and young adults with 

both physical and intellectual disabilities. Ms. Lockhart will provide perspective today on how the Federal disabilities programs, 

while seemingly very well intentioned, can have devastating consequences on individuals and communities if not handled correctly. 

Tragically, many children are languishing on SSI programs, rather 

than being encouraged to pursue vocational and educational opportunities. 

In June of last year, the subcommittee heard testimony from two 

former and two current Social Security administrative law judges. 

One of the themes of the testimony was the agency’s plan to reduce 

the backlog of initial claims, resulting in AJLs inappropriately putting people onto these programs. We also learned that the agency 

policy allows claimants and their attorneys to submit biased and 

incomplete evidence. 

While we have serious questions for the agency about its policies 

and management of these programs, I thank the agency for providing timely information to the committee requests. Agency personnel have conducted numerous briefings and transcribed interviews with the committee. During one of these interviews, Regional 

Chief Administrative Law Judge Jasper Bead testified that it 

raises a red flag for a judge when they allow 75 to 80 percent of 

their decisions. It is stunning that between 2005 and 2012 more 

than 930,000 individuals were approved for benefits by an ALJ who 

approved more than 80 percent of the claimants for benefits. During the same time period, more than 350,000 people were awarded 

disability by an ALJ with an allowance rate in excess of 90 percent. 

I appreciate, by the way, the bipartisan manner which the subcommittee has been able to approach this oversight. Ranking Member Speier and I both recognize there are significant problems with 

3 

these programs and that reform is needed. I thank her very much 

for the work and the partnership in this issue. 

Yesterday, Ms. Speier and I sent Acting Commissioner Colvin a 

letter outlining 11 common sense recommendations for the agency 

in order to improve the integrity of the disability determination 

process. One of the recommendations is for the agency to conduct 

timely continuing disability reviews. The agency is currently out of 

compliance with its legal requirement to conduct timely CDRs and 

has allowed a backlog of 1.3 million CDRs to develop. 

As Ms. Speier and I explained in our letter, an increase in CDRs 

must be coupled with a change to the medical improvement standard, because this standard does not allow the agency to remove 

claimants who were wrongfully awarded benefits in the first place. 

Under the current standard, the claimant’s record must show that 

the claimant made significant medical improvement in order to end 

benefits. If the claimant was not disabled and wrongly received 

benefits initially, the standard of review will not remove them. 

Today the agency must address this question: Are the vast majority of people who the agency expects to improve failing to do so 

or is it just extremely difficult for the agency to cease benefits? The 

question highlights a significant problem that needs to be addressed and needs to be addressed quickly. Today’s testimony will 

show that the state of disability determination offices that conduct 

CDRs suffer from a lack of clear guidance about the medical improvement standards. 

It will also reveal GAO made recommendations to the agency to 

correct problems with the CDR process, and made that recommendation years ago, yet the agency has failed to implement 

fully the GAO’s recommendations to address these problems. It is 

in the works, but we have to be able to get it finished. Failure is 

not an option at this point. The agency must take steps to improve 

the disability review process and modify the review standards so 

that only individuals with genuine disabilities and who are unable 

to work continue to get benefits from these programs. 

This is a program designed to protect those most vulnerable. 

Through our inattention, if we don’t protect the most vulnerable, 

it is our gross error, and this committee intends to stay on top of 

that. 

With that, I recognize the ranking member, Ms. Speier. 

Ms. SPEIER. Mr. Chairman, thank you. 

At the outset, let me say this. There aren’t a lot of cameras in 

this room today, but this is precisely the kind of work that the 

Oversight and Government Reform Committee should be doing; in 

a bipartisan fashion, in a constructive fashion, with a number of 

experts who are here who are, in many respects, civil servants 

doing remarkable work. And I think we both know that part of our 

effort in making sure that this system is improved upon is making 

sure they have the resources to do the job. 

So I want to thank you, at the outset, for your commitment and 

the great work that you have shown, and the way we have collaborated and worked together and had meetings outside of hearings 

to try and come up with some solutions to this situation. 

The committee has been conducting oversight of the Federal disabilities program at the Social Security Administration. Just yesVerDate Aug 31 2005 11:36 May 15, 2014 Jkt 000000 PO 00000 Frm 00007 Fmt 6633 Sfmt 6633 C:\DOCS\87819.TXT APRIL
4 

terday, as the chairman pointed out, together we sent a bipartisan 

letter to Social Security laying out a number of reforms and recommendations we believe the agency can implement to enhance the 

efficiency and effectiveness of disability adjudications and improve 

the integrity of Federal disability programs. 

Now, I believe that and I said that, but I also recognize part of 

what we are asking for is going to require more resources in order 

to do it well. 

Social Security disability and supplemental security income are 

important lifelines for millions of Americans with disabilities. Recent estimates project disability insurance benefits of about $145 

billion to approximately 11 million SSDI beneficiaries and $59 billion to almost 8.5 million SSI recipients. 

In previous testimony before this committee, Social Security Administration recited a motto repeated at the agency: The right 

check to the right person at the right time. Making sure that only 

those who meet the eligibility guidelines receive benefits is important so the American public can have confidence in their Government’s efficient and effective operation. 

The primary tool at SSA’s disposal is the CDRs, the Continuing 

Disability Reviews. These reviews are critical to the integrity of the 

Social Security disability program. CDRs are a highly cost-effective 

measure, saving the Federal Government, on average, $9 for every 

$1 spent on CDRs. So it makes all the sense in the world that we 

invest in providing the resources so that more CDRs can be done 

so that we can be confident in knowing that those who are receiving SSDI and SSI are receiving it appropriately. 

SSA’s most recent report on CDRs estimates present value sav- ings of $5.4 billion in lifetime program benefits. These numbers 

speak for themselves as to why CDRs are so critical. Unfortunately, 

as the chairman mentioned, there is a backlog of 1.3 million 

uncompleted CDRs. This is just unacceptable. We all get an F for 

not properly funding you and for not reducing that backlog in an 

appropriate fashion. We have had a backlog at the Veterans Administration on disability claims and we have thrown a whole lot 

of money at that agency to get them to reduce that backlog, and 

I am afraid we are going to have to do it here, but I think it is 

going to be cost-effective in the long run. 

An IG’s report found that 79 percent of childhood CDRs were not 

conducted in a timely fashion. Additionally, GAO has found thousands of cases of child recipients who were expected to medically 

improve within 18 months, exceeded their scheduled review date by 

as much as six years or more. You know, this is unacceptable as 

well. 

Another IG found that even when a CDR is conducted and determines benefits are no longer medically justified, those benefits are 

not always terminated in a timely manner. That results in an estimated $83.6 million in improper payments. That is unacceptable. 

President Kennedy once said we can do better, and I really do 

believe we can. But so must Congress. Annual appropriations of 

funds for CDRs have fallen short of the levels authorized in the 

last few years, and that is unacceptable. This is not the first time 

Congress has allowed a backlog of CDRs to develop. Again, we have 

to take some responsibility here. In the 1980s, the mid-1990s, ConVerDate Aug 31 2005 11:36 May 15, 2014 Jkt 000000 PO 00000 Frm 00008 Fmt 6633 Sfmt 6633 C:\DOCS\87819.TXT APRIL
5 

gress also failed to provide adequate funds. Finally, in 1996, Congress acted by increasing funds for CDRs. The backlog was eliminated by 2002, but, again, it took six years to do it, even with the 

resources being put in place. 

We should once again recognize the importance of CDRs and this 

year finally provide the agency with the funds it needs. CDRs help 

protect taxpayer funds and the public’s interest. Congress must dependably provide adequate funds so that backlogs and the improper payments that result from them never return. 

Today we will also hear from a representative of disability examiners who are well positioned to help detect and prevent fraud at 

the initial determination level and while conducting CDRs. It is important that disability examiners have the training and resources 

to perform their jobs effectively. It is also important that we support the work and achievements of the inspector general on initiatives like CDIs that allow coordination and collaboration on efforts 

to prevent, detect, and investigate fraud in Federal disability programs. 

Mr. Chairman, it is a pleasure to work with you on this issue, 

and I look forward to the testimony. 

Mr. LANKFORD. Members will have seven days to submit opening 

statements for the record. 

We will now recognize the panel. 

Mr. Daniel Bertoni is the Director of Education, Workforce and 

Income Security at the U.S. Government Accountability Officer. 

Ms. Jennifer Nottingham is the President of the National Association of Disability Examiners and a supervisor within the Ohio 

Disability Determination Service. We will have DDS thrown 

around a lot today. 

Ms. Marianna LaCanfora is the Acting Deputy Commissioner for 

Retirement and Disability Policy at the Social Security Administration. 

Ms. Jennifer Shaw Lockhart is the State Director for Sooner 

SUCCESS at the University of Oklahoma Health Sciences Center, 

a fellow Oklahoman. 

Mr. Patrick O’Carroll is the Inspector General for the Social Security Administration. 

Pursuant to committee rules, all witnesses are sworn in before 

they testify. If you would please stand and raise your right hand. 

Do you solemnly swear or affirm the testimony you are about to 

give will be the truth, the whole truth, and nothing but the truth, 

so help you, God? 

[Witnesses respond in the affirmative.] 

Mr. LANKFORD. Thank you. You may be seated. 

Let the record reflect that all the witnesses answered in the affirmative. 

We will have time for discussion and questions after your opening statements. We have assigned five minutes for each of your 

opening statements. 

Mr. Bertoni, you are first up. 

6 

WITNESS STATEMENTS 

STATEMENT OF DANIEL BERTONI 

Mr. BERTONI. Thank you. Chairman Lankford, Ranking Member 

Speier, members of the subcommittee, good afternoon. I am pleased 

to discuss our work on the Social Security Administration’s efforts 

to assess DI and SSI program recipients’ continued eligibility for 

benefits. 

Last year, SSA provided nearly $200 billion in benefits to about 

11 million DI and 8 million SSI recipients. Both the numbers of recipients as well as program costs have grown in recent years, and 

are poised to grow further due to economic and population changes. 

To ensure that only eligible individuals receive disability benefits, accurate determinations at the time of application and followup reviews after benefits are granted provide an important check 

on growth and are key to ensuring program integrity. 

Federal law requires that SSA conduct periodic Continuing Disability Reviews, or CDRs, of recipients and requires SSA to find 

substantial evidence of medical improvement before ceasing benefits, known as the medical improvement standard. My remarks 

today are based on our prior work and discuss SSA’s efforts to assess recipients’ continued benefit eligibility and aspects of the review standard that affect these efforts. 

In summary, SSA reported in January 2014 that it is behind 

schedule in conducting CDRs and has a backlog of 1.3 million reviews. The agency is also conducting fewer CDRs in general. From 

fiscal year 2000 to 2011, adult CDRs fell from over 580,000 to 

100,000, and child CDRs dropped from over 150,000 to 45,000. 

For those children with mental impairments, CDRs declined 80 

percent, from 84,000 to just 16,000. Thus, in 2012, we reported that 

over 400,000 child SSI cases with mental impairments were overdue a CDR, with more than 24,000 overdue by six years or more, 

including thousands who were deemed likely to medically improve. 

When CDRs are not conducted as scheduled, especially for those 

children whose conditions are likely to improve, improper payments 

may occur. And although child benefits are more likely to be ceased 

after review, SSA has historically placed a higher priority on conducting adult CDRs, which generally result in a cessation rate of 

around 12 percent. 

Of the child CDRs SSA does conduct, we found that the average 

benefit cessation rate was 32 percent; and for those with mental 

impairments, such as personality disorder and speech and language delay, cessation rates were 39 and 38 percent, respectively. 

In our report, we recommended that SSA work smarter to better 

target its limited resources and eliminate the backlog of child 

CDRs, with a specific focus on those likely to medically improve. 

SSA generally agreed with our recommendation, but cited resource 

limitations and competing workloads as a barrier going forward. 

Beyond the issue of SSA CDR prioritization, factors associated 

with the medical improvement standard pose a challenge to assessing recipients. During CDRs, individuals that SSA determines to 

have improved medically may have their benefits ceased. However, 

we reported in 2006 that only 1.4 percent of recipients who left the 

rolls did so because they had medically improved. 

7 

We also noted several factors that hindered us the ability to 

make this determination, including the limitations in SSA’s guidance for determining what level of improvement would constitute 

a cessation and how to apply key exceptions; inadequate documentation of prior disability decisions, especially for cases decided 

at the appeals level; and the judgmental nature of the process, especially for those cases involving psychological impairments. 

In our report, we noted that these factors had implications for 

the consistency and fairness of decision-making and recommended 

that SSA clarify its policies for assessing medical improvement. 

Since then, SSA has taken some steps that may help address the 

issue, but has not fully implemented our recommendations. Thus, 

its guidance is likely to continue to be problematic for staff in their 

efforts to make sound and consistent decisions. 

Mr. Chairman, this concludes my statement. I am happy to answer any questions that you or other members of the subcommittee 

may have. Thank you. 

[Prepared statement of Mr. Bertoni follows:] 

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Mr. LANKFORD. Thank you. 

Ms. Nottingham. 

STATEMENT OF JENNIFER NOTTINGHAM 

Ms. NOTTINGHAM. Chairman Lankford, Ranking Member Speier, 

and other members of the committee, thank you for inviting NADE 

to share the perspective of the frontline disability determination 

employee. After several years of high attrition rates and hiring 

freezes, combined with an increased number of people applying for 

disability, the DDS’s caseload grew, particularly CDRs. With this 

year’s budget, SSA was able to hire a DDS staff and is dramatically 

increasing the number of CDRs sent for review. 

NADE believes it is critical to invest and train for all staff. Employees at all levels of the disability adjudication process should receive more training opportunities and updates. This includes disability hearing officers and ALJs. It would be counterproductive to 

remind examiners of a policy, only to have it be not known by a 

hearing officer or ALJ. 

Medical improvement review standards shifts the burden of proof 

from the claimant to the DDS. SSA has a strict definition of disability, and to be found disabled the individual must prove that 

they meet the criteria. However, at the CDR the definition is removed. The medical improvement review standard policy dictates 

that benefit continue unless the beneficiary’s disabling condition 

has shown to have demonstrated medical improvement related to 

the ability to work. This standard is very stringent and, as a result, 

few claims are actually ceased. It is important to note that, 

through appeals, a DDS cessation may end up being continued by 

the disability hearing officer or ALJ. 

In processing a CDR claim, the DDSs are required to compare a 

beneficiary’s current condition to their condition at the time of the 

most recent medical decision. Because of MIRS, the DDS cannot fix 

what may be perceived as a mistake or wrong decision, as the DDS 

is not allowed to substitute judgment. There are many times during the processing of a CDR claim where the disability examiner 

would not currently find the beneficiary disabled, but must continue benefits because medical improvement has not been demonstrated. If an individual is allowed and had minimal or normal 

findings at the Comparison Point Decision, as long as they still 

have similar findings, they will be continued. 

There are exceptions to MIRS; most notably the fraud and error 

exception. These exceptions only apply in a small portion of CDRs. 

The error exception policy states that it cannot be used to substitute judgment, and it can only be used when a previous claim 

shows evidence that there was a clear objective error. An example 

would be a decision based off of records for the wrong patient. So 

even though the CDR examiner may consider the previous decision 

wrong, it is very difficult to prove an error, particularly if there is 

minimal rationale. The exceptions are underutilized and additional 

training is needed; however, the exception would still only apply to 

a small portion of CDRs. 

There has been significant attention on the allowance rate of 

ALJs. It is likely that fraud or error would not be found in most 

cases. The difference in the high allowance rate is more likely due 

24 

to a difference in subjective conclusions or decisions based on limited information. Where this is often seen is in the assessment of 

credibility and the weight of medical source statements. The totality of the evidence needs to be considered. Factors such as objective 

medical evidence, medical history, consistency of the record, and 

activities of daily living should be considered when assessing the 

credibility and medical source opinions. If a statement is not well 

supported or inconsistent with the record, it should be given less 

weight. The credibility and medical source opinions can have a 

large impact on the outcome of a claim. They are subjective conclusions and the DDS is directed to not substitute judgment. 

In the adjudicative process, if a conclusion is not supported, poorly documented, or inconsistent with the available evidence, this 

would not be considered an error that can be cited, and if there is 

no clear objective error found, then MIRS directs us to determine 

if benefits continue. NADE recommends changing the CDR process 

and would support a discussion on a de novo decision at CDR. 

It is important to make sure the correct decision is made initially 

and only appropriate claims are allowed. NADE applauds SSA’s recent focus on policy and medical training with ALJs. Many examiners complain of ALJ decisions where the medical source statements are not supported with evidence, yet given great weight. 

NADE feels it would be beneficial if the DDSs were able to be represented at the ALJ to help ensure policy compliance where display 

examiners receive more training. 

More review and oversight may be needed at all levels of the adjudication process. Currently, there is minimal review of ALJ in 

disability hearing officer decisions. Although most claims are now 

electronic, there are still paper claims and some end up lost. CDRs 

with lost folders end up being continued most often. If the DDS 

cannot reconstruct the prior decision in order to make a comparison, it will be continued. Steps should be taken to decrease the 

number of paper claims processed and to prevent lost folders. 

NADE continues to support the expansion of CDI units to help 

combat fraud. More emphasis on referrals to CDIU of CDR claims 

may be needed, along with additional fraud or similar fault training. At CDR, many beneficiaries do not have treatment, despite 

many having access to treatment. That means the examiner rely 

upon a decision from a consultative examination that they are only 

seen one time. It is hard to make a decision without longitudinal 

evidence, and it is discouraging to see beneficiaries that don’t take 

advantage of medical treatment to improve their condition. 

That is all I have. Thank you for allowing me the opportunity to 

share NADE’s views on CDRs. 

[Prepared statement of Ms. Nottingham follows:] 

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Mr. LANKFORD. Thank you. 

Ms. LaCanfora. 

STATEMENT OF MARIANNA LACANFORA 

Ms. LACANFORA. Chairman Lankford, Ranking Member Speier, 

members of the subcommittee, thank you for this opportunity to 

continue the conversation on Social Security’s disability programs. 

My name is Marianna LaCanfora and I am the agency’s Acting 

Deputy Commissioner for Retirement and Disability Policy. 

Today, my testimony focuses on medical continuing disability reviews, or CDRs. These program integrity reviews, which cover both 

the Disability Insurance and Supplemental Security Income disability programs ensure that only those beneficiaries who remain 

disabled continue to receive benefits. While CDRs are essential, it 

bears acknowledging that they are only one of many critical workloads that millions of Americans depend on us to complete each 

year. Absent sufficient funding, we must make difficult tradeoffs as 

we balance our service and stewardship responsibilities. 

I would like to highlight a few important points regarding our 

CDRs. First, we have proven that our CDRs are an excellent investment and, when we receive adequate resources, we deliver. For 

example, we received a seven year commitment of special funding 

from Congress in fiscal year 1996 so that we could eliminate our 

backlog of CDRs. By the time the funding had expired, in 2002, we 

had eliminated the backlog and saved about $36 billion in taxpayer 

money. 

The second point I would like to make about our CDRs is that 

we strictly adhere to legal requirements and we consistently 

achieve high quality. Our adherence to the medical improvement 

review standard perhaps best illustrates this point. Congress enacted the medical improvement review standard in 1984 to address 

widespread concern that disability adjudicators were substituting 

their judgment to overturn the judgment of a prior adjudicator. 

In 1984, the law remedied this by generally requiring that we 

terminate benefits only if a beneficiary’s condition medically improves and that improvement is related to the ability to work. This 

standard has remained unchanged for 30 years. We continuously 

train our adjudicators on its correct application and our quality review of CDRs shows a high rate of decisional accuracy, 97.2 percent 

last year. 

My third point is that absent adequate funding, we are forced to 

make difficult tradeoffs and prioritize CDRs. We focus our limited 

funding on the CDRs most likely to produce the highest return on 

investment or the highest amount of taxpayer savings. Our highest 

priority CDRs are age 18 re-determinations and low birth weight 

baby cases because they are statutorily required. We prioritize 

other CDRs using a statistical model that gathers data from our 

records to identify a high likelihood of medical improvement and a 

high return on investment. We complete of these cases as our funding permits. 

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37 

pedited manner, without the need for expensive medical development when the likelihood of cessation is remote. 

Despite our efforts to keep pace with the CDR workload, chronic 

under-funding has led to a backlog of 1.3 million cases. We did not 

receive the full funding for CDRs authorized by the Budget Control 

Act in each of the last two years, but I am pleased to say we did 

receive the full amount this year, and thank you to the committee. 

With the additional funding, we plan to complete 510 full medical 

CDRs this year, and we will also hire and train more employees. 

The President’s budget for fiscal year 2015 also requests the full 

BCA level for Social Security. With this funding we plan to complete 888,000 full medical CDRs. 

Starting in fiscal year 2016, the President’s budget proposes a 

dedicated dependable source of mandatory funding for our agency 

to conduct CDRs. The mandatory funding will enable us to eliminate the CDR backlog. We need your support of the President’s 

budget to ensure that only those beneficiaries who remain disabled 

continue to receive benefits. Timely, sustained, and adequate funding is the single most important way to eliminate the CDR backlog. 

Thank you, and I am happy to answer any questions you may 

have. 

[Prepared statement of Ms. LaCanfora follows:] 

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Mr. LANKFORD. Ms. Lockhart. 

STATEMENT OF JENNIFER SHAW LOCKHART 

Ms. LOCKHART. Thank you, Mr. Chairman and thank you, Ms. 

Speier. Thank you all for your time today. 

On behalf of Sooner SUCCESS and every individual with disabilities, I am here today. I am here today to speak with you about 

the state of our existing system. I am here to tell you it does not 

work and I am here to tell you why. 

You might ask what positions me to speak out so strongly about 

what I believe to be one the most undignified supports we have in 

our great Country. I have seen it firsthand and I have lived it. 

From the moment my family adopted four children with special 

needs over 30 years ago to the moment I stand here today, I have 

witnessed it up close and personal. 

First let me tell you about Sooner SUCCESS. Sooner SUCCESS 

was piloted over 10 years ago by Dr. Mark Walraich. At the time, 

Dr. Walraich left Vanderbilt University for the University of Oklahoma to fill the chief of developmental behavior pediatrics Shaun 

Walters Endowed Chair, also known as the University of Oklahoma Child Study Center. Dr. Walraich, realizing the same struggles he found at Vanderbilt, developed Sooner SUCCESS. 

Sooner SUCCESS was developed on a complex adaptive systems 

approach, CAS, allowing local coalitions to address their unique 

needs. We believe Sooner SUCCESS, exactly through this advancing and inclusive comprehensive unified system, does this. We do 

it within their community. Sooner SUCCESS embeds multiple levels of service delivery seamlessly so families can address both immediate and long-term goals and adaptive approaches. 

Through this approach we are not only able to analyze the multiple systems, but educational, health, and social families struggle 

to navigate, but also mobilize the system as warranted within the 

community when needed through adaptive agents. This is where 

our local coalitions and county coordinators are tremendous assets. 

Change is inevitable, so we must organize the system in a way, 

adapting to change, but also educate providers, caregivers, self-advocates, and families and patients to understand an ever-evolving 

system instead of multiple independent, static structures or agencies. 

Anecdotally speaking, we believe this model works. We see this 

observation in articles such as the recently published Newsweek 

article titled The Health Gap: The Worst Place in America for Mental Health, Child Poverty, and College Attendance Mapped. The article ranked counties in each State. Of the top 10 counties in Oklahoma, 5 are Sooner SUCCESS counties and part of the original 

program 10 years ago. 

Last year alone, in 2013, Sooner SUCCESS made over 31,000 

community linkages in our 13 pilot counties. Our 13 counties consist of Tulsa and Oklahoma City, Oklahoma’s two most populated 

cities, and 11 rural communities. Within these demographics, we 

are able to serve close to half of Oklahoma’s children with disabilities ages newborn to 21. 

We often serve transitional years 18 to 24 as well. With that 

said, you could say we have a pulse on the grassroots level, the 

48 

view from the balcony, as to what our communities look like; each 

very different, with very unique needs. We are your eyes and ears 

on the ground. What does the view from the balcony look like? A 

victim of unintended consequences our system designed to assist 

individuals with disabilities is paralyzed by multiple levels of dysfunction. 

For the sake of understanding why, we will understand Sooner 

SUCCESS. Sooner SUCCESS based on this system, is able to see— 

and I am going to skip through here because I want you to hear 

this. This is the problem: system complexity; weak ties and poor 

alignment among professionals and organizations; a lack of funding; incentives to support collaborative work; a bureaucratic environment based on command approach and control management. 

Further, I quote from recent publication in the International 

Journal of Integrated Care: Lack of system change towards integration is that we have failed to treat the system as a complex adaptive system. The data suggests that future integration initiatives 

must be anchored in this perspective and focus on building the system’s capacity to self-evolve. We conclude that integrating care for 

disabilities requires policies and management practices that promote system awareness, relationship building, and information 

sharing, and that recognized change as an evolving learning process rather than a series of programmatic steps. 

What does this mean on the system level and what does it have 

to do with our issues here today? 

Permission to continue further. 

Mr. LANKFORD. I give you unanimous consent to do another 

minute. 

Ms. LOCKHART. I am sorry? 

Mr. LANKFORD. You want to close, then we will come back for 

questions, or do you need another minute? 

Ms. LOCKHART. I need another minute, please. 

Mr. LANKFORD. Go for it. 

Ms. LOCKHART. Thank you, sir. 

It means that unless the system fluid and adaptive, we leave it 

vulnerable. Those vulnerabilities expose themselves through certain outcomes, mostly gaps in service, system exploitation, duplicative services, and fragmentation or dissonance in services. Those 

vulnerabilities also tell us what often numbers cannot, what the 

system looks like from real-life application. 

So in real world terms what does that look like? In the words of 

our Oklahoma County coordinator, proud Democrat and mother of 

a child with Downs Syndrome, I am tired of seeing those who need 

help unable to get it because people who don’t need it are using the 

system. We see it every day. 

From Donald Baily of South Carolina—I sent this to him; I wanted to be sure he was okay—I am testifying at a hearing next week 

in DC presenting testimony regarding disability reform. In my testimony, I hope to be discussing the higher Ed piece and referencing 

work with the College Transition Connection in South Carolina. Is 

this okay? Donald’s reply—and I will tell you why this is important—good for you. Of course you can. Tell all. Thanks. 

Donald is a former trustee with the University of South Carolina, 

father of a son with autism, founder of the South Carolina College 

49 

Transition Connection, a consortium of five universities in South 

Carolina providing higher Ed options for individuals with intellectual developmental disabilities. Donald and his wife, along with 

other parents, created the CTC because they wanted something 

more for his son than sitting at home after he aged out of the system. 

I have chosen Donald and Lori, and could provide you with many 

more parent provider statements as to the barriers in the system. 

The bottom line is due to the many gaps we have created a pervasive problem in which we have left not only the system vulnerable, 

but the individuals we are to be helping. We see children with impairments labeled disabled. We see parents and adolescents remain 

underemployed so they may sustain their benefits. We see thousands on a wait list in Oklahoma who receive no service because 

they are waiting for assistance. 

Aside from service gaps, we see something more concerning, 

deeply concerning. We see people with disabilities unknowingly 

segregated from their communities because the transition from the 

school support service stops often when the individual ages out of 

the system. Services stop; the sports system is gone instantly; and 

because transition services are programs rather than processes, we 

see individuals who should be out in their communities go from an 

active community life, that being their school, to nothing almost 

overnight. 

In observation, we are able to see a gap where most young adults 

with disabilities should be transitioning into the community. Why 

weren’t they in their community all along? 

[Prepared statement of Ms. Lockhart follows:] 

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Mr. LANKFORD. Ms. Lockhart, we are going to move on. When we 

come back, we are going to pummel you with questions here in just 

a minute as well, so I want to make sure we have time for everybody, too. 

Ms. LOCKHART. Thank you, sir. Yes, sir. 

Mr. LANKFORD. Mr. O’Carroll. 

STATEMENT OF PATRICK P. O’CARROLL, JR. 

Mr. O’CARROLL. Good afternoon, Chairman Lankford, Ranking 

Member Speier, and members of the subcommittee. Thank you for 

inviting me to be here today. 

A 42-year-old man was living out a childhood dream: he was the 

lead singer of his own hard rock band and he also owned a popular 

cafe. For almost 20 years his band had toured the Country and performed at large music festivals. He talked up his band’s success on 

social media, touting performances for millions of fans and worldwide sales of thousands of albums and t-shirts; even been interviewed for local newspaper articles and TV interviews. And during 

this entire time he was receiving Social Security Disability for 

mood disorders. 

Last year, during a continuing disability review, or a CDR, a disability examiner referred the man’s case to one of our cooperative 

disability investigations, or CDI, units. The man’s musical exploits 

made the examiner suspicious that he might not be eligible for benefits because he was more capable than he claimed. The CDI investigation confirmed that the man was able to work and perform activities contrary to his disability. With this information, SSA 

ceased the man’s benefits in January. 

I share this example because it combines the value of two of our 

most effective integrity tools: CDRs and the CDI program. CDI efforts usually focus on initial claims, but disability examiners can 

also refer questionable in-pay cases to a CDI unit for investigation, 

as in this case. It is one of the many reasons we are pleased that 

the acting commissioner has agreed to expand CDI by up to seven 

units by the end of 2015. 

Of course, CDRs on their own have proven to be effective guards 

against improper payments in the disability programs. My office 

has long urged SSA to conduct more CDRs every year. We also consistently encourage Congress to fund these critical reviews. With 

the return on investment of $9 saved for every dollar invested in 

CDRs, appropriating funds to conduct these reviews is sound fiscal 

policy. However, after dedicated funding ended in 2002, CDRs declined by over 75 percent, creating a significant backlog. 

Although SSA has been conducting more CDRs since 2009, the 

backlog still stood at $1.3 million last year. As a result, SSA continues to make payments that could be avoided. For example, according to past audit work, up to $1.1 billion in disability payments 

could have been avoided in 2011 alone if CDRs had been performed 

when due. 

Similarly, re-determinations can prevent improper payments in 

the SSI program. These non-medical reviews will yield an anticipated 5 to 1 return this year. From 2003 to 2008, re-determinations 

decreased by 60 percent. Our audit work found that $3.3 billion in 

69 

SSI payments could have been avoided in just two years if more 

reviews were completed. 

I am encouraged that SSA has completed more eligibility reviews 

in recent years. For this year, the agency has stated that it plans 

to complete 510,000 medical CDRs and almost 2.5 million re-determinations. We are currently evaluating SSA’s progress in completing these reviews and we plan to issue a report later this year. 

We have long focused our audit efforts on CDRs and re-determinations because there are such sound reasons for funding and 

conducting them as scheduled. For example, in a recent audit we 

found that SSA hadn’t conducted 79 percent of childhood CDRs or 

10 percent of age 18 re-determinations within the time frames required by law. The cost over four years was $1.4 billion. Payments 

made because of delayed reviews are troubling because they are 

largely avoidable. We recognize that SSA is a difficult task in processing and increasing number of new claims, but the agency must 

continue to seek ways to balance customer service with stewardship responsibilities. 

Through our audit and investigative work, we keep working with 

SSA and Congress to protect these critical programs. 

Thank you again for the invitation to testify, and I would be 

happy to answer any questions. 

[Prepared statement of Mr. O’Carroll follows:] 

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Mr. LANKFORD. Thank you to all of our witnesses. 

I will begin our questions. 

Ms. Lockhart, I have a question. Your statement about undignified supports and then your statement of multiple levels of dysfunction. 

Ms. LOCKHART. Yes, sir. 

Mr. LANKFORD. You tried to walk through some of those as well, 

but one of the key issues—you started to talk at the very tail end— 

I know I had to cut you off a little bit on your testimony. You started talking about the impact of families and individuals in communities and out of communities. What it seemed like you were saying 

is when these individuals are put into this, they are actually pulled 

out of society and they are separated out. 

The question I have for you is what do you think the goal of the 

disability program should be? 

Ms. LOCKHART. The goal should be to provide a route back into 

their community. The overarching goal should be that people with 

disabilities have an independent life. Also, define what disability is. 

Impairment does not necessarily mean disability. 

Mr. LANKFORD. Okay. Now, hold on for just a moment on that 

one. You are right, impairment is not disability. The challenge of 

this is that once you get into the system, if you have an impairment and they define it as you are not able to do substantial gainful work, employment, then you may be impaired, but you are now 

tagged as disabled and you are actually prevented from employment. Is that what you are experiencing? 

Ms. LOCKHART. Right. 

Mr. LANKFORD. So what does that look like? 

Ms. LOCKHART. We have situations where either the children 

aren’t getting services that would help them move forward or children that in our professional position might be impaired, but not 

disabled. We have experienced families that the parents at times 

will—what is the word I want to use?—sometimes stall the process. 

Mr. LANKFORD. You mean stall the process of re-engagement in 

society? 

Ms. LOCKHART. Right. Right. So we see both. But we are saying 

that to those that do have disabilities, sir, we don’t have a mechanism that is sure and sound that provides them a way into the 

community. We are still, for the first time, really understanding. 

And I know that we have programs, but what we see is we see the 

families on the system level here, so imagine two rails, and then 

we see commerce, private sector over here. And really what we 

need to see is they converge. So to say we want our disabilities to 

have jobs, people with jobs be paid fairly, those kinds of things, and 

be an integral part of our community, we have to prepare this side 

over here as well. 

Mr. LANKFORD. Okay. 

Mr. O’Carroll, you made a comment about increasing the CDRs 

and watching out for the reviews and such. Based on what Ms. 

Nottingham was saying, it is not just a matter of increasing the 

number of CDRs, it is actually the effectiveness of the CDRs. So 

what are you experiencing with the actual review when the review 

occurs? 

Can I put this up on the screen as well? 

77 

[Slide.] 

Mr. LANKFORD. There is a stat that we have been able to locate 

here. Social Security Administration provided this. This is from 

2003 to 2013, so it goes back a decade for us, asking the question 

of when CDRs actually occur, what happens at that point. Once 

they have been evaluated, when they go into the system, evaluated, 

are they expected to recover from this or be out of the system possible or not expected. 

So here is the number of reviews, the number of removals, and 

what we found interesting is over the decade there the people that 

were expected to at some point leave the system, there is only 18 

percent of them that actually do. What is interesting to me is those 

that were not expected, 7 percent of the folks that were not expected leaving. It is really not that far apart, an 11 percent difference between the two. 

So what we see is people that are even expected to be out of the 

system really don’t leave the system. It sounds like, to go back to 

what Ms. Nottingham was saying, there is an issue with not just 

doing CDRs, but the effectiveness of CDRs based on even the initial expectation. 

Mr. O’CARROLL. Yes, Mr. Chairman. On that, I guess from some 

of the work that we have done, a lot of the expectations that they 

are having aren’t found as we are finding here. One of those issues 

that is part of this hearing is talking about medical improvement 

on it and the issues with medical improvement. And with medical 

improvement, if you were found disabled, by the next time you 

come back to a DDS on it, unless you have improved from what you 

were found the last time, you are going to be found still disabled. 

And we are finding that if you use the standard that you use 

when you first come in, which would be different than the medical 

improvement, it would be an initial application, there would be a 

lot more findings in terms of a person improving. And what we 

found on that, we just did a report on it, we are waiting for comments back from the agency, but we found in that case about 4 percent of the people that were found disabled would not be found disabled if you used the initial disability application formula instead 

of the improvement formula. 

Mr. LANKFORD. I am sorry, I am just about out of time. Can you 

say that last part again? 

Mr. O’CARROLL. The last one I said is it is about 4 percent of the 

people that we looked at that were found disabled would not have 

been found disabled had they come in on an initial application. So, 

in other words, what they are saying is that what they purport 

with was below the level of what they would have been put on disability, but since they were already on disability, they couldn’t be 

taken off it. 

Mr. LANKFORD. Okay. 

Mr. O’CARROLL. So we are seeing that 4 percent. To be truthful, 

it could be a much higher percentage. There is a problem, though, 

with the record-keeping that SSA was doing on it, and we find it 

could go as high as 12 percent, because there about 8 percent of 

the cases that we looked at were incorrectly cited. So, as an example, they said they were thrown off or they were taken off for a 

78 

medical improvement, but when we read the file on it, we found 

it was really because they had returned to work. 

Mr. LANKFORD. Okay. 

Mr. O’CARROLL. So we are asking for more accuracy on that so 

we can get a better standard. But that is an example of what you 

were saying here. 

Mr. LANKFORD. Thank you. 

Ms. Speier. 

Ms. SPEIER. Mr. Chairman, thank you, and thank you to all of 

our witnesses. 

The presentation that was made by the inspector general of this 

rock band that suggested they had lots of social media, you were 

able to access it on social media, Ms. LaCanfora, does the Social 

Security Administration have the authority to consult social media 

accounts when conducting CDRs? 

Ms. LACANFORA. Our adjudicators do not consult social media. 

And let me explain why, if I may. We understand the committee’s 

interest in this issue, and we are certainly open to more discussions and discussions with the IG, but let me be clear about one 

thing. Right now, our adjudicators refer 22,000 cases per year to 

the inspector general that they find to be suspicious. Our adjudicators are trained in fraud detection and they look at medical evidence, they look at the allegations of the individual, they weigh all 

of the evidence and they detect anomalies, and they do it very well. 

Ms. SPEIER. I have very limited time, so you just have to answer 

the question. Right now they do not, is that correct? 

Ms. LACANFORA. That is correct. 

Ms. SPEIER. Do they have the authority to and they just don’t? 

Ms. LACANFORA. We do not allow them to look at social media. 

Ms. SPEIER. Do you, within the Social Security Administration, 

have the authority to require them to look at social media? 

Ms. LACANFORA. Yes. 

Ms. SPEIER. All right, so we don’t need legislation to do that. 

Ms. LACANFORA. Correct. 

Ms. SPEIER. All right, so this is a decision that you made. 

Ms. LACANFORA. Correct. 

Ms. SPEIER. All right. I would disagree with that decision because I think that social media is a very fair and appropriate way 

of doing a CDR. So that is just one area that we need to pursue 

a little bit more. 

Inspector General, your office found that DI beneficiaries and 

SSI recipients improperly receive payments after medical cessation 

determinations, costing taxpayers $83.6 million. Does the Social Security Administration have a clawback provision for collecting improper payments? 

Mr. O’CARROLL. Yes, they do, in two ways. One is that they can 

declare an overpayment and then of any benefits that are going in 

the future on it, they will take the penalty out of that. Then the 

other tool that we use is civil monetary penalties. So when we find 

that a person has lied, and if they aren’t on benefits and we can’t 

attach the benefits to get the overpayment from them, we will then 

charge them with a civil monetary penalty and get benefits back 

that way. 

79 

Ms. SPEIER. So does that clawback actually take place, then? And 

you are in charge of the clawback, not—— 

Mr. O’CARROLL. No. Unfortunately, all we do is, if it is in a court 

and the court has a judgment that the person has to pay it back, 

it is up to the Justice Department to collect it. And in the other 

ones where overpayment is assessed by SSA, they monitor it and 

collect it, we don’t. 

Ms. SPEIER. All right, so it is unclear whether or not we do any 

clawback. On the one hand, if someone is getting payments that 

shouldn’t be getting them and it is our fault because it is a clerical 

error, I would not necessarily be supportive of a clawback. 

Mr. O’CARROLL. Agreed. 

Ms. SPEIER. But if it was adjudicated, they know they are not 

supposed to be getting payments, they continue to get payments, 

then I think there is a reason to clawback; and you are saying they 

have the authority and it is unclear whether or not they use it. 

Mr. O’CARROLL. Yes. 

Ms. SPEIER. All right. The IG report recommended that the Social Security Administration enhance its automated termination 

system following medical cessation decisions and the Social Security Administration agreed to that recommendation. 

So my question to you, Ms. LaCanfora, is when will that recommendation be implemented? 

Ms. LACANFORA. That recommendation has already been implemented. We discussed this at our hearing in November, if you 

might recall. We have made two systems changes to ensure automated cessation, so that there is no time delay between the decision at the DDS and the actual cessation. We have one more piece 

of that to implement, which we are going to do this fiscal year, to 

make sure that there is no gap at the hearings level. In addition 

to those systems changes, we are also going to continue to have a 

safety net in place where we do periodic runs to make sure no 

cases fall through the cracks. We fully support the idea that the 

cessations need to be made timely. 

Ms. SPEIER. So to you, inspector, does that then cover all the potential terminations that don’t take place that should take place? 

Mr. O’CARROLL. Yes. In fact, our recommendation was that systems enhancements be made so that it is automated and that it 

will be caught, and that is being implemented right now. So we 

haven’t audited it, we haven’t declared it a success, but at least 

they are in the right direction. 

Ms. SPEIER. All right, very good. 

Mr. Chairman, I am going to actually give you back 15 seconds 

in the hopes that we will be able to have a longer second round. 

Mr. LANKFORD. We will. We will. 

Mr. Walberg. 

Mr. WALBERG. Thank you, Mr. Chairman, and thanks to the 

panel for being here. 

Mr. Bertoni, as I understand, every two years a high-risk list is 

established of agencies and programs. Can you explain how the 

GAO designates a program to be high-risk? 

Mr. BERTONI. Sure. There is typically two criteria. The first criteria is whether they have significant management operational 

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gram integrity issues, mismanagement. The second part is organizations may need urgent transformation in many ways. 

Mr. WALBERG. As I understand it, Federal disability programs 

have been designated as high-risk every time the list was issued 

since 2003. Can you explain why? 

Mr. BERTONI. On the first front, in terms of the management and 

operational side, we continue to see issues with their ability to get 

out in front of the backlogs, with their ability to make timely and 

accurate payments. We still have a significant overpayment situation. So even on that management and operational front, where we 

have seen some progress in some areas, it wouldn’t be proper for 

us to remove it from the list. 

On the other side, the area of transformation, we have said for 

many years they need to take a more modern approach to disability. 

Mr. WALBERG. More modern approach? 

Mr. BERTONI. More modern approach to disability. Disability 

today versus what it was 20 years ago, when we were a manual 

labor economy versus a service and knowledge-based economy is 

much different. Their criteria, their listings, their listings of jobs in 

the national economy have not kept up to date with the 

transitioning and what a disability looks like today, and we have 

had numerous recommendations that they address that. 

Mr. WALBERG. Thus the illustration of the performing artist, 

being able to work and successfully raise a lot of funds. 

Mr. BERTONI. Well, in that case, that is a significant management and operational issue there, not having appropriate tools to 

get out in front of that problem. 

Mr. WALBERG. Mr. O’Carroll, which reviews, of the multiple reviews, adult CDRs for SSI, SSDI, childhood CDRs for SSI, age 18 

re-determinations for SSI, which reviews are most cost-effective? 

Mr. O’CARROLL. Mr. Walberg, probably the most cost-effective 

one would be the work CDRs, and work CDRs are the ones where 

we are showing wages are being posted against a person who is 

supposedly not working because they are disabled. Then, at that 

point, they would be brought in to SSA. But a little bit of texture 

to the conversation is that work CDRs are difficult to do; they are 

done by SSA, usually take a lot of study in terms of seeing if somebody had gotten a bonus or termination, another type of bonus like 

that. So, any way, they are difficult to do, but they have a very 

high return on investment. 

The next one down would be the medical reviews, and the medical reviews are, just as we said, because of the person having a 

disability, getting better, they are probably the more easily accepted and understood of the type of reviews that are done; and they 

are done by DDSs, and that is where the DDSs are doing those. 

So, anyway, I guess the best one to say on it is the word CDRs 

are the most effective. 

Mr. WALBERG. Mr. Bertoni and Mr. O’Carroll, how much taxpayer money has been wasted because of SSA CDR backlog? 

Mr. BERTONI. I can’t speak to the dollar amounts. I can say that 

we had over 400,000 cases that we identified in the SSI kids realm 

that were well overdue for a CDR, and we didn’t project that to 

81 

what that would be, but over time, a lifetime of benefits, that is 

a significant amount of dollars. 

Mr. WALBERG. That was in the children’s realm, you said? 

Mr. BERTONI. Yes. 

Mr. WALBERG. Thank you. 

Mr. O’Carroll? 

Mr. O’CARROLL. We are anticipating that several billion dollars 

are lost every year because of the backlog on the CDRs. 

Mr. WALBERG. Four hundred thousand cases, several billions of 

dollars. 

Ms. LaCanfora, why did the agency allow a huge backlog of 

CDRs for children with conditions that tend to be temporary? 

Ms. LACANFORA. Well, with all due respect, I return that question in part back to the Congress. We have been inadequately funded over a series of years and unable to complete the number of 

CDRs that we need to complete. In fact, we have had to make very 

difficult tradeoffs in which CDRs we are going to do. And with respect to children, here is how we prioritize: we look for the greatest 

savings to the taxpayer; and the reality is the greatest savings to 

the taxpayer does not lie with children, because their benefits tend 

to be lower than adults. So we strictly look for savings to the taxpayer when we prioritize. 

Mr. WALBERG. But the length of time is significantly more, correct, with children? 

Ms. LACANFORA. We take into consideration the fact that we do 

review all children at age 18, so the average lifetime savings is actually lower when you look at children. 

Ms. SPEIER. Would the gentleman yield? 

Mr. WALBERG. I will yield. 

Ms. SPEIER. Ms. LaCanfora, my understanding is the difference between adult payments and child payments is about $100 a 

month, isn’t that true? 

Ms. LACANFORA. I don’t know off the top of my head what it is, 

but children’s payments can be significantly less than adult payments. And, remember, the SSI program, there is all kinds of rules 

for children like deeming. Children’s benefits are offset by income 

from the parents. 

Ms. SPEIER. All right. I don’t want to take any more time of the 

gentleman. My understanding is that the actual payments are 

about $100 in difference. 

Mr. WALBERG. In difference. Correct. 

I yield back. 

Mr. LANKFORD. Ms. Duckworth. 

Ms. DUCKWORTH. Thank you, Mr. Chairman. 

Ms. LaCanfora, I would like to continue on the CDRs. My understanding is that the Federal Government saves about $10 for every 

dollar spent on CDRs. Is that correct? 

Ms. LACANFORA. It is about one to nine, but close. 

Ms. DUCKWORTH. One to nine? And I wanted to sort of touch on 

this history. You mentioned the fact that we had adequately, at one 

point, funded CDRs and you were able to catch up. In your opinion, 

what is your recommendation in terms of funding? You just said 

that you are not being adequately funded. Are you asking, recommending a similar funding to get rid of this particular backlog of, 

82 

what is it, $1.3 million over a multi-year period? What is your recommendation as an expert in the field? 

Ms. LACANFORA. Yes. Absolutely, the bottom line is you get what 

you pay for when it comes to CDRs. In fiscal year 2014 we received 

the Budget Control Act funding level, $1.197 billion, which will 

allow us to do 510 medical continuing disability reviews. If, in fiscal year 2015, we get the BCA level, we will be able to do 888,000 

CDRs, and we are asking for $1.396 billion to do that. Subsequent 

to 2015, the President’s budget has a proposal for mandatory sustained funding separate from our administrative budget so that we 

can continue the momentum and eliminate the CDR backlog. 

Ms. DUCKWORTH. So what you are saying is you need to get help 

covering the next two years to make a big dent in getting caught 

up in the backlog, and after that you have the mandatory that 

kicks in and then you will be able to work towards getting rid of 

the backlog and maintain parity with the new cases coming in? Am 

I saying that correctly? 

Ms. LACANFORA. Yes. Yes. 

Ms. DUCKWORTH. Okay, thank you. 

Ms. LACANFORA. And that is our objective. 

Ms. DUCKWORTH. Mr. O’Carroll, you wanted to say something? 

Mr. O’CARROLL. Yes, Ms. Duckworth. Just to give a little context on that, what we are finding with that $1.3 million that is in the 

backlog on it, just doing the 510 on it won’t touch the backlog at 

all. And under the current funding level, what we took a look at 

is in the next five years is four of the five plans on it will not reduce the backlog. 

So what we are finding is that, at least from our studies on it, 

they are going to have to be doing up in about the 900,000 level 

to be able to have a significant impact on that backlog. So that is 

the biggest issue. They are keeping current, but they are not getting the backlog down, and that is where the more funding and 

more direction is needed. 

Ms. DUCKWORTH. Are there any other reasons why a backlog has 

developed, other than inadequate funding, in your opinion? 

Mr. O’CARROLL. No, because we can pretty much show from all 

the work that we have done is when SSA dedicates the resources 

to doing it and the dedication is coming from their funding, that 

they will reduce that backlog back. That is what we were talking 

about in the early 2000s, was when the money was there they did 

reduce the backlog. 

Then after that, when the funding wasn’t there, the backlog kept 

growing, and then what would happen is they would be doing less 

and less each year, so the backlog kept growing. In fact, last year, 

even with funding on it, it went from $1.2 to $1.3 million as the 

backlog of it. So it goes to show even with the current funding on 

it it is difficult for them to be getting any progress on the backlog. 

Ms. DUCKWORTH. I just have a little time left. Inspector General, 

can you touch a little bit on CDIs and on how the CDI units have 

become effective in rooting out fraud and preventing disability 

overpayments? How do the CDI complement CDRs? 

Mr. O’CARROLL. The CDI program is, I guess, one of our most effective anti-fraud programs going on; it is a group of between us 

and the SSA that we do it. And one of the things you were saying, 

83 

how it ties in with the CDR is that we work very closely, because 

we have two DDS employees assigned to the CDI unit, and as the 

DDS is noticing anything suspicious either in an initial application 

or when somebody is brought in for a CDR and they need more information on it, they will refer it to the CDI unit. The CDI unit 

then will be using all the different tools that they have, between 

records to find out whether persons have licenses or other types of 

information that is contrary to the disability; social media; surveillances, and all those ones. So that usually there if there is a question on a CDR, the CDI unit can help. 

Ms. DUCKWORTH. Thank you. 

I yield back the remainder of my time. 

Mr. LANKFORD. Mr. Cartwright. 

Mr. CARTWRIGHT. Thank you, Mr. Chairman, and I thank the 

chairman and the ranking member for bringing this important 

hearing, and certainly all of our witnesses for appearing here today 

to shed light on this important subject. 

The public trust in this Country really depends on the Social Security Administration’s efforts and success at ensuring that people 

are not getting Social Security Disability payments who don’t qualify for them and also that everybody who does qualify for Social Security and should be getting Social Security Disability is getting it. 

And I thank you for appearing here today. 

Ms. LaCanfora, I have a question for you. Your testimony lays 

out some of the steps SSA has taken to improve program integrity 

and to help ensure CDRs are done right and that their outcomes 

are based on consistent application of policy. These efforts demonstrate an organizational priority on improving the quality of 

CDRs, the efficiency of the process, and fair treatment of the beneficiaries. In fact, the truth is SSA’s efforts have resulted in a very 

high CDR decisional accuracy rate. Am I correct in that? 

Ms. LACANFORA. You are correct. 

Mr. CARTWRIGHT. Okay. In prior testimony, SSA Deputy Commissioner Sklar stated, ‘‘The aging of baby-boomers, the economic 

downturns, additional workloads, and tight budgets increase our 

challenges to deliver.’’ Isn’t it true that actuaries have known for 

years that the number of people eligible to receive Social Security 

Disability was going to grow? Is that true? 

Ms. LACANFORA. Yes. 

Mr. CARTWRIGHT. And how did they know that? 

Ms. LACANFORA. Not only the actuaries, but the Social Security 

trustees, as well as the Congress have known for a very long time 

that the program was not sustainable. 

Mr. CARTWRIGHT. It was as plain as the nose on your face, wasn’t 

it? 

Ms. LACANFORA. Safe to say. 

Mr. CARTWRIGHT. Does SSA have the funds necessary to ramp up 

its program integrity efforts in view of the greater need created by 

this anticipated growth in SSD claims? 

Ms. LACANFORA. We are very pleased with the fiscal year 2014 

budget; it is the first time that we have received the money authorized in the Budget Control Act. It will put us on a trajectory that 

will allow us to eliminate the CDR backlog, yes. 

84 

Mr. CARTWRIGHT. Does SSA have sufficient legal authority to 

protect the integrity of the disability program? 

Ms. LACANFORA. Yes. 

Mr. CARTWRIGHT. Okay, so we don’t have to legislate new law; 

it is just about money, isn’t it? 

Ms. LACANFORA. That is the single biggest determining factor, 

yes. 

Mr. CARTWRIGHT. All right. Well, I thank you for that. 

I think our witnesses have made clear that SSA has to have sufficient resources, and I appreciated your comments, Inspector General O’Carroll, about the return on investment, as I think you put 

it. We got an ROI of nine to one if we properly fund your efforts, 

and I think that the CDR proper funding is a subset of the entire 

question of proper funding of the SSA, again, to make sure not only 

that people who are getting disability checks are supposed to be 

getting them, and that is the work of the CDRs, but also that the 

people who should be getting disability checks and aren’t getting 

them, that the process is sped up for those people, that justice is 

done for those people, and that the public trust in SSA is maintained and restored so that we clean up the backlogs not only in 

the CDR system, but also for the claimants to begin with. 

I thank you again for appearing today and I yield back to the 

chairman. 

Mr. LANKFORD. Thank you, Mr. Cartwright. I do agree that the 

CDR time—by the way, we are going to start a second round here 

to be able to jump in and we will have a more open conversation 

as we go through. 

CDRs are incredibly significant in this, but I go back again to 

Ms. Nottingham, and I want to be able to mention this to you and 

want to be able to pull something out. It seems to be that it is not 

just the quantity of CDRs, it is the quality of what they are able 

to actually accomplish with it. 

I want to go back to your comments earlier about the definition 

for medical improvement. Both what is coming out from the ALJs 

and what you see, the quality of that product, that work product 

that is coming and the determination of does this person actually 

have medical improvement, how is that working? Because with 18 

percent of the people that were expected to be removed actually removed, those are CDRs that actually occurred, were paid for, and 

I am quite confident that many of them that were expected to be 

removed shouldn’t be removed yet, they still qualify. But 18 percent seems like a very low number to me, and it goes back to your 

comment earlier, trying to deal with the definition of medically disabled. Can you help me with this? 

Ms. NOTTINGHAM. Most cases wouldn’t get a medically improvement expected diary for when it should come back to CDR. Conditions, there are some that really are unknown that tend to get that, 

like certain cancers, where it really depends upon the result of the 

treatment, so we might give a shorter diary for that. I think that 

we tend to see an expected diary given from an ALJ, and I think, 

from what I have seen, or believe that there might be in a belief 

that the person will return to their own; they will get treatment, 

improve, and just return to work on their own. And that is just not 

what happens. 

85 

Ms. SPEIER. By returning to work, is it returning to the same 

kind of work they were doing before or just being able to work in 

some job? 

Ms. NOTTINGHAM. That is not something that we would look at. 

Ms. SPEIER. No, but I was just wondering in terms of the definition. 

Ms. NOTTINGHAM. Oh. Depending upon their age and education, 

the vote grids is where that comes into play. We first look and see 

if they can return to their work as it was described or as it was 

performed in the general economy and if not, then is there other 

work out there, and that is where we take into consideration age 

and education. 

Mr. LANKFORD. Are you talking about at the CDR or are you 

talking about at the initial evaluation? 

Ms. NOTTINGHAM. The initial. The vocational grids and those factors only come into play on a CDR if we have already found that 

medical improvement has occurred; otherwise, we wouldn’t look at 

that at all. 

Mr. LANKFORD. Okay, that is my preference on the question 

when we are coming back. Let me see if we can broaden this out. 

When you are doing the disability determination, you have it on 

a State level. Do you have access to social media? Are you doing 

some of your own investigations or are you dealing with just all the 

documents that are in front of you? Do you have authority to be 

able to do any of your own investigation as well? 

Ms. NOTTINGHAM. We would basically mainly look at medical 

records. We might get information from a third party if we have 

permission from the claimant to contact other people. Sometimes 

we might contact a former employer, but it is hard to actually get 

that information. The CDIUs have access to social media, the examiners do not have access. 

Mr. LANKFORD. Okay, wait. Run that passed me again. Who 

doesn’t have access? 

Ms. NOTTINGHAM. Adjudicators or examiners would not, only 

CDIU. 

Mr. LANKFORD. Okay, so a typical case. But the CDI, that is not 

normal on that. 

Ms. NOTTINGHAM. Right. 

Mr. LANKFORD. That is a smaller number and only in certain regions, correct? 

Ms. NOTTINGHAM. Yes, only 22 office or States. 

Mr. LANKFORD. Okay, so in a typical disability determination you 

are taking only basically the documents that are in front of you. 

If you are going to contact a next door neighbor or if you are going 

to contact an employer, you have to actually get permission typically from the person that you are looking at the forms from. 

Ms. NOTTINGHAM. Yes. Usually when they file an application 

there is a place for them to list a contact person. Sometimes they 

don’t have anyone or don’t list anyone; generally they do. And we 

also use that just to follow up with them in case we lose contact 

with them. So if it is on there, then we already have permission 

to contact them, so we wouldn’t necessarily ask during the middle 

of development. 

86 

Mr. LANKFORD. Okay, what I am trying to figure out is there is 

really no investigation; you are taking the documents, the onesided—and this is going to sound more caustic than it should—the 

biased documents, because everyone has a natural bias; they are 

applying for disabilities, they are going to make sure they write it, 

prepare it, or they have counsel that is helping them prepare it to 

make sure they get all the right words on there to be able to detail 

out here is what needs to be. That is really all you have to evaluate 

by. 

Ms. NOTTINGHAM. We are very limited in what we can get. That 

is why I mentioned the point about having only a consultative examination when someone doesn’t have treatment. It is best when 

we have records for years because the consistency helps make sure 

we are making the right decision if there is a consistent history of 

how they have been doing. But when we only have an exam or onetime exam, it really leaves the decision a little bit more questionable. 

Ms. SPEIER. Can we have Ms. Nottingham go through her recommendations that were in her statement that I don’t think you 

actually got to, did you, or you kind of rushed through? 

Ms. NOTTINGHAM. One of the things that we would like to look 

at the MIRS policy, the medical improvement review standard, in 

general. 

Ms. SPEIER. Right. 

Ms. NOTTINGHAM. Because we do see that very few people get off 

the rolls through this process. 

Ms. SPEIER. And you would attribute that to the MIRS process. 

Ms. NOTTINGHAM. Yes. 

Ms. SPEIER. So how would you have us change that? 

Ms. NOTTINGHAM. When the diaries do have a new decision to 

see if they are disabled at that point, following the initial rolls. 

Ms. SPEIER. So that is your reference to de novo review, is that 

what you are suggesting? 

Ms. NOTTINGHAM. Yes. 

Ms. SPEIER. So it basically would allow you to open up the entire 

case to look at, as opposed to just looking at documents. So you 

could, for instance, look at social media. 

Ms. NOTTINGHAM. By policy we are not allowed to look at social 

media. 

Ms. SPEIER. I have a hard time with that. 

Ms. NOTTINGHAM. I do have some concerns with social media. 

Ms. SPEIER. All right, tell me what they are. 

Ms. NOTTINGHAM. Just that it could be of some benefit, but someone posting on their social media, we would have to make sure you 

can confirm that that was actually them, and also a picture of 

them working on a truck or something like that could have been 

years prior to their actual injury. So it is a piece of information 

that could be useful, especially when you are looking into fraud or 

similar fault, but it is only one piece of information. 

Ms. SPEIER. All right, Inspector, how would you comment to 

that? 

Mr. O’CARROLL. Thanks for asking. I have to say of course we 

have concerns what would happen if they rolled out social media 

87 

to all SSA employees, and I think that is a management issue with 

SSA. 

But what we think in terms of the social media, and I used that 

in my example here, we have used it on other examples, we think 

it is a good tool. And as it happens now, we call it in the investigative world it is a clue. And you take a look at that clue, you take 

a look at other clues, and it is part of a big picture, not the picture 

itself. 

So one of the suggestions that I have been coming up with is 

with SSA we now have an national anti-fraud committee, which is 

co-chaired by myself and the CFO of the organization, and one of 

the subcommittees under it I would like us to do a pilot program 

when we start taking a look at giving different SSA employees access to social media and give it a pilot and see how it works out. 

So that is one of the things that I am taking to the national antifraud, is to see if we can start doing that. 

Ms. SPEIER. You know, I just am sitting here thinking if 60 Minutes did a piece and showed all of the potential abuse, and then 

it was then turned on us and what are you doing about it, and we 

are basically saying, well, we don’t allow people to look at social 

media. I think we would be laughed at. 

Mr. O’CARROLL. I agree. That is why I am saying it is a good tool 

and it is something that SSA should start piloting and see. But it 

is one of those things that, in fairness to them, probably some caution needs to be done in doing it; is not something of the snap of 

the fingers. But I think it is something to move into the 21st century, that it has to be considered. 

Mr. LANKFORD. It doesn’t solve everything, we understand that, 

but it is a tool. As you mentioned, it is a clue; it is something that 

could be out there. It just provides an opportunity for a question. 

Even if there was the opportunity to be able to say notice this, tell 

me about this. Just to be able to initiate the conversation. By the 

way, notice that you also have on your social media that you hire 

out to also mow lawns. That would be something that you would 

ask a question about at some point. 

I want to go back to this MIRS process. We need to drill down 

on this more. There is a difference between their initial evaluation 

and then what happens when we have a CDR. Talk to us about the 

differences here between the two. 

Ms. NOTTINGHAM. In my testimony, I mentioned that the definition of disability is removed from the CDR process. 

Mr. LANKFORD. Right. 

Ms. NOTTINGHAM. The initial claim process, we are looking at 

their conditions and making assessment of their functioning, and 

then applying the vocational grids and finding out, then, if they 

meet the criteria for disability. We don’t consider that at all in a 

CDR with the MIRS, if there is no indication of significant medical 

improvement. 

Mr. LANKFORD. Okay, so help me understand. When you are 

dealing with this and you have to evaluate medical improvement, 

what is the grid that you are working through on that one? There 

is the grid that is the prior one. How do you make a decision of 

medical improvement? Because you really have two issues here, the 

medical improvement and then can they engage in substantial 

88 

gainful activity. Or is this at this point, once we have left it, gainful activity is not there, it is just medical improvement? 

Ms. NOTTINGHAM. You have to consider medical improvement. If 

we can’t establish that there is medical improvement, we would not 

go on to the vocational aspects. 

Ms. SPEIER. But the problem there is that if it was questionable 

in the initial evaluation, but they got benefits anyway, then you 

are perpetuating what may have been a bad decision to begin with, 

correct? 

Ms. NOTTINGHAM. Correct. That happens regularly. 

Mr. LANKFORD. When you say regularly, are you talking 4 percent or are you talking 40 percent? I know this is going to be your 

ballpark guess. We get that. So we are not going to hold you to an 

absolute statistical number. Your experience. 

Ms. NOTTINGHAM. My experience, and the experience of many examiners, would perceive it to be higher than 4 percent. I would 

think maybe something 20 percent is a ballpark. 

Mr. LANKFORD. That should have never been on in the first 

place. 

Ms. SPEIER. Mr. O’Carroll, what do you say? 

Mr. O’CARROLL. As I said, on that one there, when we did the 

study on it, we found 4 percent for sure, and then we found 8 percent that was questionable because of the information. So anywhere from 4 to 12 is us. 

Mr. LANKFORD. Okay. 

I am sorry to interrupt. Keep going on that, then. 

Ms. NOTTINGHAM. It becomes difficult because a lot of subjective 

conclusions are made in the disability process, and we can’t substitute judgment, so if we can’t establish an actual true error was 

made, we end up continuing, and we look at, then, if there is medical improvement. 

So someone who is allowed for very minimal impairments, their 

functioning wasn’t really limited but they were granted disability 

benefits because of maybe the statements they made. The statements should have been supported by the evidence and consistent 

with everything else, but even though that wasn’t given appropriate weight and they maybe just based the decision solely on the 

statement of the claimant, or maybe even one of their doctors, that 

would be substitution of judgment is how I understand the policy, 

so we would then use the MIRS to find out if there is medical improvement, it would not be an error. 

Mr. LANKFORD. But we are still back to the same spot. How are 

you defining medical improvement? You are not substituting judgment, but there is some judgment in this. 

Ms. NOTTINGHAM. Yes, the medical improvement is going to be 

subjective. We look at the signs, symptoms, and laboratory findings. Some conditions have a lot more objective findings, particularly physical. 

Mr. LANKFORD. Okay, so help us with an example. Give us an 

example of something working through. 

Ms. NOTTINGHAM. A back impairment is something that is very 

common, and we usually look at things. They have x-rays, so that 

is a very objective test, or other imaging, and then we look at 

things like their muscle strength, their range of motion, and any 

89 

neurological injuries. So we would look at that, and if they still 

continue to have decreased range of motion and some normal 

strength or decreased strength, if those are consistent with what 

we saw before, then we would say that that is not medical improvement. 

How much medical improvement is where a lot of the subjectivity 

and differences may come in. I would think, though, that most— 

I have seen people who try to use very little improvement, something like a range of motion that was limited to 60 degrees and 

then they have 90 degrees range of motion, something minor like 

that, they would try to use that as an argument, and then we get 

overturned. Those would not fight through appeal. 

Ms. SPEIER. So, Mr. Chairman, I have a question here. You are 

attorneys or you are judges, correct? 

Ms. NOTTINGHAM. No. 

Ms. SPEIER. What are you? I mean what are the examiners. 

Ms. NOTTINGHAM. The DDS examiners are State employees and 

the qualifications range from State to State. Most require a bachelor’s degree of some sort, and we have extensive training in medical policy. 

Ms. SPEIER. Okay, but no medical training per se, I mean, you 

are not professionally physicians or health care professionals. 

Ms. NOTTINGHAM. Correct. Most people would not have a medical 

background. 

Ms. SPEIER. So you came up through the ranks with a bachelor’s 

degree and then, through training, became examiners, is that correct? 

Ms. NOTTINGHAM. Correct. We usually have quite extensive 

training, at least of 10 to 12 weeks of pure training, and then we 

ease people into a caseload with extensive review. In my State we 

have a one-year probation for an examiner. 

Ms. SPEIER. But here is my concern. In a workers comp system, 

in an interesting sort of way, this is like a workers comp system. 

In a workers comp system, it is a system that is very different from 

this system, but there is a physician that evaluates the claim and 

then the continuation of the benefits depends on that physician review and by a second physician review that may be from the employer. 

Ms. NOTTINGHAM. We do have doctors that review things, review 

the decisions, the medical assessment in most States. 

Ms. SPEIER. What States don’t? 

Ms. NOTTINGHAM. There are single decision-maker States and 

there are some decisions that do require like any denial for psychological impairment would require a doctor. They are the prototype 

States and the 10 additional. 

Ms. SPEIER. They are the which States? 

Ms. NOTTINGHAM. I don’t know. There was a prototype that 

started about 16 years ago, and we are still running on a prototype 

for those 10 States, and there were an additional 10 States that receive single decision-maker authority. 

Ms. SPEIER. Oh, prototype. A permanent pilot. 

Mr. LANKFORD. Yes, that is a pretty long pilot project. 

Ms. NOTTINGHAM. Yes, exactly. I can name a few States, but I 

don’t have that information. 

90 

Ms. SPEIER. Can you just name them? 

Ms. NOTTINGHAM. Michigan, Missouri, North Carolina. 

Mr. LANKFORD. Anyone else can jump in on this if you know 

what some of the States are as well. 

Ms. LACANFORA. I don’t know the States off the top of my head, 

but I do want to say I think we are getting into a very confused 

area on this issue. If the question is do the examiners have access 

to medical consultants, we have hundreds of medical consultants 

on contract, and they review cases. There are certain cases where 

we do not have a medical review, but we are pretty specific about 

where that is. For example, we have cases called compassionate allowances; they are very specific impairments where the objective 

medical evidence will prove a finding of a severe disability. In those 

cases we don’t require medical consultation. 

It is a little bit of a complicated area I think that we are getting 

into, but disability examiners generally have access to medical professionals. 

Mr. CARTWRIGHT. Mr. Chairman, may I jump in for a moment? 

Mr. LANKFORD. Sure. Jump in. 

Mr. CARTWRIGHT. Now, we have heard testimony today about the backlog of CDRs being $1.3 million, is that right? So we are talking 

about 1.3 million people who are receiving SSD or, in some cases, 

SSI who have gone passed their scheduled date for review, which 

makes them part of a backlog, is that it? I see heads nodding. 

So one thing that I am wondering about is whether this is a 

backlog that is disproportionate to the CDR process in SSD. Specifically what I am wondering is the people who have originally applied for SSD, somebody has had a horrible illness which has left 

him or her, rendered them unable to work, at least that is what 

they think and that is what they claim, so they put in for Social 

Security Disability. And I have heard talk that there are backlogs 

for those applicants as well. Anyone disagree with that? Seeing no 

nodding heads there. 

Does anybody have an idea of what the number of the people is 

who are in that backlog, the people who are waiting for overdue Social Security Disability initial determinations in this Country? 

Ms. LACANFORA. I don’t have that number off the top of my head, 

but let me try to answer your question this way. I think you hit 

upon a very important point. We have seen extreme service degradation in the past few years that ranges far beyond the realm of 

program integrity or medical CDRs. We are closing our field offices 

an hour early every day and on Wednesdays we close at noon simply because we do not have the resources to handle all the work 

coming in the door. We have lost 11,000 employees in the past few 

years. Our wait times have gone up across the board. 

Mr. CARTWRIGHT. So that is exactly what I was getting at, Ms. 

LaCanfora, and thank you for your candor there, because when you 

talk about severe degradation, it doesn’t just apply to the CDR 

process; it applies across the board at SSA, doesn’t it? 

Ms. LACANFORA. Absolutely. 

Mr. CARTWRIGHT. Thank you. 

I yield back. 

Ms. LACANFORA. May I also just give you the data that you 

wanted regarding the benefits of individuals on whom we perform 

91 

CDRs? The average benefit payment for an SSI child is $545 a 

month; the average benefit payment for an adult getting SSDI is 

$1,146 a month. Thus, the reason I said that the payoff is much 

greater for adults on disability. 

Mr. LANKFORD. Okay, I am going to go to Ms. Lujan Grisham in 

just a moment here, but when we talk about the benefits, the administrative costs, and the backlog, and all that is happening is accelerating, is some of the issue just the number of people that are 

trying to enter the system? We are dealing with fairly static numbers. When you look at the last five years, the numbers have been 

fairly static for what is actually coming in in administrative costs 

for SSA. 

Ms. LACANFORA. Our workloads have consistently increased, 

while our staffing levels have consistently decreased. 

Mr. LANKFORD. You have a tremendous number of new people 

that are coming in, your funding levels are not going up, so part 

of our issue is the number of applicants that are coming into the 

system. So part of our question is why have we seen this giant 

jump in the number of applicants get in the system? 

Ms. LACANFORA. Well, I think as we discussed before, this is not 

news. The Social Security actuary, the board of trustees, the Congress has been well aware, and this has been predicted for many, 

many years. The reason for the growth in the disability programs, 

and we have research done by economists on our Web site which 

corroborates the findings of our actuary, demographic changes have 

resulted in an increase in the number of people on disability, specifically the aging of the baby-boomers, individuals entering into 

their disability-prone years, and women entering the workforce and 

gaining insured status under the program. Those demographic 

changes are the reason for the increase in the growth in our programs. 

Mr. LANKFORD. But that is not going to show an increase in why 

we have more children in the program, aging and all those things, 

that dynamic. We have this dramatic increase as well in SSI. 

Ms. LACANFORA. There is a very good CBO report that is out 

that talks about the increase in the growth in the childhood program, and it talks about a variety of factors that are also demographic. First, there is more widespread acknowledgment and diagnosis of medical conditions among children. We don’t create the diagnosis at Social Security, we follow the medicine. There has also 

been an increase in the number of children living in poverty. And 

you have to remember that SSI is a needs-based program. So as 

more children live in poverty, more applications come in for SSI. 

Mr. BERTONI. If I can just jump in here. There is a big gap between the growth in physical impairments versus mental impairments. If you look at physical impairments in the SSI program, the 

line goes like this. If you look at mental impairments, the line goes 

like. So we don’t know what explains that, but we do know that 

on the mental impairment side, when those cases are decided, at 

least in the case of speech and language delay, 80 percent of those 

cases are decided on the functional criteria, which is very subjective. So it is not a listing, it is not a grid; it is a functional criteria. 

Ms. SPEIER. So let’s drill down on that, because a whole group 

from Social Security came in and met with me on ADHD. Speech 

92 

and language is one of those conditions that does improve as the 

child advances, and you are saying that you are seeing a dramatic 

increase in that particular area. 

Mr. BERTONI. Absolutely. It is one of the top three impairments 

where there are increases. Speech and language delays has increased significantly, and it is considered by many to be a transient 

impairment, where you can grow out of it with maturity. And the 

allowance rates are very high, so I think it is evident that these 

children have that condition. But the cessation rates are very high 

down the road when they finally do these, MIRS notwithstanding; 

38 percent cessation rate. So it tells me that these folks, these children are likely growing out of this condition, but SSA is not reviewing the cases. 

Ms. SPEIER. Okay. So, to that point, you would say, Ms. 

LaCanfora, that they don’t reap the same benefits, so you don’t 

focus on those cases. But it would seem, based on the GAO’s study, 

that that is the one area where there is dramatic improvement; 

whereas, in many medical conditions of adults, there isn’t improvement. Certainly in these mental, for the most part, disabilities 

there is dramatic; I know ADHD is one of them. So why wouldn’t 

we, then, focus more attention on those cases, as the GAO is suggesting? 

Ms. LACANFORA. So the math here is very simple. We could. We 

could do more childhood CDRs. But if we did more childhood CDRs, 

we would do fewer of something else. And then my colleague, Mr. 

Bertoni, would be here with a different report citing the much 

greater loss to the taxpayers in revenue by not doing that other 

group of CDRs. 

Ms. SPEIER. No, he is going to disagree with you, and I think I 

will as well. Go ahead, Mr. Bertoni. 

Mr. BERTONI. I think we acknowledge that there are resource 

issues and there are tradeoffs to be made. Managers manage; managers to the pain. We have put on the record at least three impairments that have cessation rates in excess of 30 percent; ADHD at 

25 percent, some personality disorders 39, and then, of course, the 

speech and language delay. For SSA to come here at some later 

date to say we understand that, we may have a problem, we are 

going to take some piece of the DI money, given the return on investment, and perhaps do a limited 10-year look at these cases to 

perhaps cease the ones that need to be ceased, we would not have 

a problem with that; that is managing to your resources. 

Mr. LANKFORD. Ms. Lujan Grisham, just to let you know, we are 

in a second round on this, so anywhere you want to jump in, you 

are welcome to be able to jump in with any set of questions. So 

take off. 

Ms. LUJAN GRISHAM. Thank you all for being here. This is a subject that, in both a positive and not so positive way, are very near 

and dear to my heart. First, my sister, who has been gone many, 

many years, unfortunately, had a significant disability, both physical and developmental back when special education was brand 

new. So just in terms of getting any resources for a family tough. 

And I know all too well what it is like even today, decades later, 

what it is like to get disability services, whether it is a Medicaid 

through a waiver, whether it is SSI, whether it is SSDA. Whatever 

93 

that resource component is, it is very difficult still to get it, attain 

it, hold it, and then make it last for the things that you need. 

And I also worked in the field of aging and long-term care and 

DD, adults with disabilities, world for 30 years. I also come from 

a State who, unfortunately, as has been highlighted now in every 

major news media, has the worst public health outcomes of any 

State in the Country, largely related certainly to socioeconomic 

issues. 

But just look at our fetal alcohol syndrome issues and look at our 

higher than national averages, which are way too high, for autism. 

So when you are looking at the number of kids that are spiking, 

we are also seeing a whole new host of significant increases, and 

I think a lot of it is better diagnostics, but I think probably we will 

find, and that is beyond my pay grade, some researcher is going 

to find very clearly what is going on, I hope, so that we can do 

something about it. 

The balance here, and I appreciate this committee’s hearing 

today and the comments of my colleagues, when we are wasting 

billions of dollars by doing overpayments and not doing an effective 

administrative service, because I worry about the 220 average days 

for somebody to get a disability determination. I am concerned 

about the growing waiting list on the other side. And I do respect 

that you have to manage to your resources, but I worry that in the 

context of this hearing we are going right back to where we go; it 

is all of one and none of the other. 

I think that there can be much more accountability in all of these 

offices. And maybe I am on a diatribe with no question, I am so 

sorry, Mr. Chairman—that is what happens on the second round, 

I guess—that I expect this Administration, probably more than 

most, to do it. But managing to your resources isn’t going to change 

that we need to, I am going to call it a level of care in some of the 

claims determinations review. 

But the last time I heard, when you have Down Syndrome, that 

doesn’t change, that diagnosis; you keep it. So the notion that you 

get better; you can improve some functional limitations, but I always am offended when there is a sense that people can get dramatically better. And that is not to say, by any stretch of the 

imagination, that I don’t expect accountability where there can be, 

because it is finite. We have a growing number of people and we 

want to do the best by the number of people we have. 

So if I can maybe boil this down to a question, what can we do 

to balance those two issues more than just we need more resources 

in Social Security? I would be one of those there, I would be one 

of those who is there. But I also want you to be accountable with 

those resources and expect that you do everything in your power. 

How do you start, today, catching up in a way that recognizes that 

I don’t want this to be on the backs of beneficiaries and I don’t 

think—I heard Ms. Lockhart earlier. I may disagree with your 

characterization about how people with disabilities come to you and 

what those situations are. 

How do we right-size those so that we are aggressive on the 

management side, we don’t create more discrimination and a more 

difficult process for people to attain the benefits that they are entitled to, which are intended to provide dignity, respect, independVerDate Aug 31 2005 11:36 May 15, 2014 Jkt 000000 PO 00000 Frm 00097 Fmt 6633 Sfmt 6633 C:\DOCS\87819.TXT APRIL
94 

ence, a savings on the long-term care side somewhere else, and an 

opportunity for people to reenter the workforce and to do the things 

that we want them to have every opportunity to do? 

Give me as many quick ideas as you can about right-sizing. Nobody can. 

Ms. LACANFORA. I will start out. You mentioned the funding 

issue, and I know you are well aware of that, but with respect to 

the discussion of prioritizing CDRs, we wouldn’t have to prioritize 

CDRs if we had adequate funding. We wouldn’t have to prioritize 

them at all because we would be doing all of them. 

Now, with respect to what else we can do, we fully acknowledge 

that we have to evolve the policies in the disability programs to 

keep pace with medicine, technology, the world of work. We also 

have to focus on consistency and objectivity in the decision-making 

process. And we discussed at the last hearing and in our intervening meeting all of the host of things that we are doing at Social 

Security in that area, and we are working with experts across the 

Nation; the Institute of Medicine, the National Institutes of Health, 

ACIS, the Bureau of Labor Statistics. We have a whole variety of 

initiatives underway to make sure that, in fact, our policies are 

evolving and reflecting today’s economy and today’s world of medicine. 

Ms. LUJAN GRISHAM. If the chairman will let me, Mr. Bertoni, do 

you have any? Because I worry about that imbalance, which tends 

to occur every time, all or none. 

Mr. BERTONI. Sure. And I think you mentioned Downs Syndrome. That was not an impairment we focused on. We look at the 

broad spectrum of impairments, and we just flagged three that 

looked to be impairments that could yield a return on investment 

in terms of recovery. So we have given them that information, acknowledge that there are resource tradeoffs, but again, within that 

pot of money, I think they can work more efficiently. Should that 

money come down the road, we would hope that they would continue to prioritize to the areas that would continue to give them a 

return on investment. That is unclear whether they would going 

forward. 

Mr. LANKFORD. I want to recognize the ranking member of the 

full committee, Mr. Cummings. I saw you came in and I want to 

be able to recognize you for time. And this is a second round, so 

it is open microphone, so you have all the time that you need on 

it. 

Mr. CUMMINGS. Thank you very much. I want to thank the committee, Mr. Chairman, and the ranking member, for highlighting 

the need to conduct timely CDRs to help make sure disability programs are serving the truly disabled. When I served in the Maryland legislature for some 14 years, I was the chairman of the committee that oversaw Social Security for the State of Maryland, so 

this is of great interest to me. 

Now, Ms. LaCanfora, would you agree that CDRs are a highly 

cost-effective program and an effective way that ensures that disability benefits are going to only those individuals who continue, 

continue to be eligible? 

Ms. LACANFORA. Absolutely. 

95 

Mr. CUMMINGS. And so when a CDR finds that an individual is 

no longer eligible for benefits, does that mean that the original eligibility determination was in error? 

Ms. LACANFORA. No. In fact, more often than not, it is due to the 

fact that the person has medically improved. 

Mr. CUMMINGS. And that is what we would hope for, is it not? 

Ms. LACANFORA. Correct. 

Mr. CUMMINGS. I mean, that is a great result. In other words, 

instead of somebody being disabled for years and getting benefits, 

when they have improved, then that helps the person, I guess that 

gets them back to work or whatever, so that helps all the way 

around. 

Ms. LACANFORA. That is right. 

Mr. CUMMINGS. Does a CDR decision to cease benefits because an 

individual is no longer disabled mean that there was fraud? Does 

it? 

Ms. LACANFORA. No, absolutely not. 

Mr. CUMMINGS. And how often is fraud found, though? 

Ms. LACANFORA. Well, this is a question that I think we have debated quite a lot in prior hearings. The only real data that we have 

on fraud in our disability program is a study that was done by our 

inspector general in 2006 that cited less than one percent of fraud 

in the program. 

Mr. CUMMINGS. So when a CDR is done and fraud is suspected, 

what happens then? 

Ms. LACANFORA. We refer that case to the inspector general. And 

as I said earlier, we refer 22,000 cases each year to the inspector 

general, and those instances of suspicion arise when our examiners 

look at the facts of the case, the assertions of the individual claimant against all of the records that they have, and they detect some 

sort of anomaly or gap in the evidence. So 22,000 times a year we 

refer those cases to the inspector general for further investigation. 

Mr. CUMMINGS. And you said that is about 1 percent? 

Ms. LACANFORA. The 1 percent is a little bit different. What I am 

saying is you asked how much fraud is in the program. 

Mr. CUMMINGS. YES. Ms. LACANFORA. And the best indicator we have is a study that 

was done in 2006 by the inspector general citing less than 1 percent fraud. 

Mr. CUMMINGS. Well, let’s go back. I am trying to get to the 

CDRs. What percentage of the CDR cases—you may not have this 

information, and let me know—of the CDR cases is fraud suspected 

and then you pass them on? You follow what I am saying? In other 

words, the CDR is conducted, it appears that there is a problem 

that is connected with fraud. I am asking you do you have any idea 

what percentage of the CDRs that are conducted result in suspected fraud. Does that make sense? 

Ms. LACANFORA. It does make sense, and Mr. O’Carroll can 

chime in. 

Mr. CUMMINGS. Somebody can answer. If you can’t answer, somebody else can. 

Ms. SPEIER. Actually, Mr. Ranking Member, I think one of the 

points of the CDR, of the CDRs that aren’t done because of the 

backlog, they have established that it is $2 billion—was that the 

96 

figure you used, Mr. O’Carroll?—of money that would come back to 

the system as a result. 

Ms. LACANFORA. But those cases are not an indication of fraud. 

Mr. CUMMINGS. Okay. 

Ms. SPEIER. Not fraud, but they no longer have the medical disability. 

Mr. CUMMINGS. All right. 

Mr. O’CARROLL. There are 22,000 that are referred to us by SSA. 

A small portion, Mr. Cummings, is going to be from the CDRs and 

fraud related to that, and that is sort of the subset that goes to our 

CDI units. We figure of the 22,000 referrals that SSA sends to us, 

about one-third of them are going to the CDI units. So that is 

where there is suspicion in a DDS referred to our CDI units. So 

about one-third of our referrals are in relation to suspicions or concerns in disability. 

Mr. CUMMINGS. You know, I am sure you all are familiar with 

that 60 Minutes show that came on not long ago. It seemed like 

there were—they talked about these attorney mills. And I am an 

attorney, so I just want you to know, but do you see a lot of that? 

Yes, sir. 

Mr. O’CARROLL. As you said, with that series on it, there were 

a number of news articles on it, The Wall Street Journal covered 

it. It was in a number of things. It is one of our biggest concerns, 

what we call facilitator fraud, and that is where you have sort of 

the mills that are going, where there are going to be people do introductions to people saying that they will get them on disability; 

they will be using unscrupulous medical providers; there will be 

facilitators for it. It has been in the news quite a bit. 

And, yes, we are concentrating on that very heavily. We are 

doing it in, I guess, three regions now; we have units that are just 

out there taking a look at facilitator fraud. They are very difficult 

investigations to do because usually you are using undercover 

agents to be inserted in to be able to show what was happening. 

We film it, we videotape it, we do all that, but it usually takes a 

couple years, where you establish an identity for a person to go in 

as an undercover on it. 

So, yes, we are exploring that extremely a lot. 

Ms. SPEIER. But, Mr. O’Carroll, in a prior meeting that we had, 

didn’t you indicate that there were thousands of these cases in 

Puerto Rico and so many hundreds of them in New York and so 

many more in West Virginia? 

Mr. O’CARROLL. Yes. 

Ms. SPEIER. Could you just give that number? 

Mr. O’CARROLL. The two examples that I used that were really 

specific was Puerto Rico. It is hundreds at this time, but there is 

also suspicion of over 1,000. And in New York City there was a 

large amount on that one, too, where facilitators were going to people as they retired from Government and said to them, we will get 

you on benefits. So we have a couple of those and we have others 

going in the other regions that I talked about. 

Mr. CUMMINGS. Now, Ms. LaCanfora, it has been suggested that 

the medical improvements standards, going back to the CDRs, does 

not allow the removal of beneficiaries who were wrongly awarded 

benefits in the first place. Is it true that under the existing review 

97 

standards, if a clear and indisputable error in the initial disability 

determination was found during a CDR, the examiner can cease 

benefits? 

Ms. LACANFORA. That is correct. 

Mr. CUMMINGS. So Social Security actuaries projected the disability insurance trust fund is only years away from being unable 

to fully finance disability insurance benefits. I would like to just as 

a few questions about that. If the agency performed every CDR required in a timely manner, would the savings in spending make a 

small, medium, or large dent in the shortfall in the trust fund? 

Ms. LACANFORA. It would be small. 

Mr. CUMMINGS. How small? 

Ms. LACANFORA. Not being an actuary, I am a little concerned 

about commenting on it, but I think it would not significantly extend the life of the DI trust fund. 

Ms. SPEIER. [Remarks made off microphone.] 

Mr. CUMMINGS. Okay, I am just asking a question. 

Ms. LACANFORA. But it would not extend the life of the trust 

fund. 

Mr. CUMMINGS. I am just asking questions. Thank you. 

So go ahead, what were you saying? 

Ms. LACANFORA. Just that if we did all of the CDRs, certainly 

that is desirable, that is what we all want to do. With adequate 

funding we will do it. But in terms of extending the life of the disability trust fund, it would not have a significant impact. 

Mr. CUMMINGS. Well, going to Ms. Speier’s point, we are talking 

about billions of dollars? I see everybody shaking your heads. 

Ms. LACANFORA. Yes. Yes. 

Mr. CUMMINGS. Okay. But you are saying that it wouldn’t, you 

see that as small. 

Ms. LACANFORA. I don’t see it—okay, let me put it into perspective. I think was said before, but for every $9 that we save the taxpayers, we have to invest, on average, $1. So it is clearly an excellent investment to do continuing disability reviews; they are essential, they should be fully funded without question. 

Mr. CUMMINGS. I agree. 

Ms. LACANFORA. But your question was to what extent would 

doing all of them extend the 2016 date of reserve depletion which 

is currently projected, and my answer is that doing the rest of the 

CDRs isn’t going to have a dramatic impact on that date. 

Mr. CUMMINGS. So what is a meaningful way, do you think, to 

address the shortfall? 

Ms. LACANFORA. The shortfall is not new; there have been shortfalls in our trust funds at least a half dozen times since the inception of the programs, and the Congress has a couple of options. 

They can do payroll tax redistribution and there are a couple of 

legislative mechanisms through which to do that. 

Mr. CUMMINGS. And Congress has acted before? 

Ms. LACANFORA. Yes. 

Mr. CUMMINGS. All right, thank you very much. 

Mr. LANKFORD. Was that for disability insurance specification 

you are talking about the redistribution? 

Ms. LACANFORA. It has been done for both trust funds. 

98 

Mr. LANKFORD. Short of that, what else can we do? Because one 

of the things that Ranking Member Speier and I, when we sent the 

letter, we were trying to detail 11 different items that can be done 

that are not just about efficiency and dollars; they are about people 

in this process, going back to what Ms. Lockhart was talking about 

before. These are lives and people that we hope to be able to transition back into productive lives for the sake of their children and the 

sake of the community as a whole and what they bring to society. 

So there are multiple issues here. What are other things, besides 

just redistributing payroll taxes, to be able to stabilize this and be 

able to bring down some of the cost areas? 

Ms. LACANFORA. So I think that there is not a connection between any of the items in your letter or any of the things we are 

working on at Social Security and the reserve depletion that is projected in 2016. In other words, all of those things that we are working on are wonderful ideas and we need to keep our eye on the 

prize and evolve the policy and the program to be more efficient 

and effective. You all have some good ideas as well, but those 

things are not going to extend the life of the DI trust fund. You 

would need to fundamentally, through legislation, completely 

change the nature of the program. 

But I want to go back to something I said earlier, which is the 

policy and the process and the management of the agency is not 

the cause of the reserve depletion. The cause of the reserve depletion is demographics; baby-boomers aging, women entering the 

workforce. 

Mr. LANKFORD. I understand. I only partially accept that just 

from some of the other things. We talked last time about the Federal Reserve in San Francisco and the report, I am sure you are 

very familiar with that. They also tracked those same issues, about 

women, age, all those things, but they came out with a 44 percent 

of unexplainable increase beyond just demographics. 

So it wasn’t just, hey, this is a pure demographic issue; they 

identified, of the additional people in the system, 44 percent of 

them no one can identify. This shouldn’t be there. That is a fairly 

high number of individuals to enter into the system unexplainable. 

We have talked about the high number of people that are actually 

applying that create this backlog not only of CDRs, but there is a 

backlog of actually getting into the system because so many people 

are hitting the system. They go through the two different DDS reports and they just automatically go to the ALJs. So there is a 

press in the backlog of the ALJs that SSA has worked on to try 

to fast-track and get people in the system and have the ALJs deal 

with this. 

So we have issues on every side of this. We have 44 percent of 

the people unexplainable while they are pressing into the system; 

we have a fast-track system of actually getting people through the 

ALJ system; we have CDRs that are occurring that we are getting 

18 percent turnaround rate of what we are expecting, and we are 

dealing with the definitions of it. There are issues on each side of 

this that have to be addressed. Some of these are legislative, we 

get that. That is one of the questions that we are asking, what is 

it legislatively do you need. 

99 

But we do feel like there is a need administratively that does 

make a difference in billions of dollars. If it takes us from 2016 to 

2017, that is a gain. What are we doing to be able to get ahead 

of this? It is just unacceptable to get to 2016 and for Congress to 

wake up and go, gosh, we have a problem. When do we all see it? 

Ms. SPEIER. Well, and let me also say that regardless of whether 

it is a lot of money or not a lot of money, the system has to have 

integrity; and people who are receiving benefits should be eligible 

to receive benefits, and those that are ineligible or grow out of eligibility should not receive benefits. And we should have a system 

that works for that end. 

I am curious about, if we could go back to Ms. Nottingham’s 

statement and her recommendations. I would just like to understand some of the ones you referenced. You said electronic claim 

exceptions should be eliminated to prevent any future claims from 

being processed in a paper format. Makes a lot of sense. Are claims 

still being processed in a paper format? 

Ms. NOTTINGHAM. There are still some exceptions. It is very few, 

but it happens still to this day. 

Ms. SPEIER. Well, by very few, then why is that a recommendation if it is de minimis. Is it de minimis? 

Ms. NOTTINGHAM. Well, the claims that are currently processed 

that are paper may be de minimis. The problem is that just more 

paper folders in general. When they come up for CDRs, some of 

them are still paper, so the fewer that we have coming in as paper, 

when they become CDRs, the few we all have that are lost. We see 

at CDR maybe a small percentage, but one or two percent of claims 

that are lost is still a large amount. 

Ms. SPEIER. So you also said the lost folder policy should not 

apply to cases of fraud or similar fault. What is the lost folder policy? 

Ms. NOTTINGHAM. In the CDR, if the prior decision folder is lost, 

we have to try to reconstruct the file, and if we are unable to do 

that, then we just continue benefits. Prior to reconstruction, we actually try to see if they meet the criteria currently, but generally 

we don’t have anything to compare because it becomes really hard 

to reconstruct the prior file. 

Ms. SPEIER. So that is our fault for losing the file. 

Ms. NOTTINGHAM. Correct. 

Ms. SPEIER. So what percentage of cases are lost folders? 

Ms. NOTTINGHAM. My belief, what I see is that it might be more 

than SSA has fully accounted for or been able to track, I should 

say, and I think it is probably like 1 or 2 percent, still. 

Ms. SPEIER. Okay, so those are small, although, even though 

they are small, they could be a significant number. I understand 

that. 

Revisions to the fraud or similar fault policies are needed. Can 

you kind of expand on that and what kinds of changes should be 

made there? 

Ms. NOTTINGHAM. There is very minimal policy at this point in 

time addressing that. Claims are very complex and it is hard to 

prove fraud or similar fault, particularly on CDRs. With CDRs, we 

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100 

cision as well, so I don’t actually handle those types of claims, 

though. 

Ms. SPEIER. Okay, I understand that. Mr. Bertoni was nodding 

his head. Maybe you can give us some—— 

Mr. BERTONI. I just think when you start talking about the issue 

of fraud, fraud is a very high bar. To get to fraud, you had to suspect something, you had to develop a case, and then you had to actually get a conviction for fraud, typically. Then there is your fraud 

figure. But is there waste? Is there abuse in the program? Absolutely. A person who gets on the rolls five years ago, recovers, but 

doesn’t have a CDR for the next three years, you finally call that 

person in, they are deemed not to be medically eligible anymore, 

they have three years of overpayments. Was that fraud? Probably 

not; you probably couldn’t go there and prove that. But was it potential waste and abuse in the program? Absolutely. So you have 

to look at this in a broader context, and it is very costly. 

Ms. SPEIER. So ADHD, can I have your opinion on how we are 

handling ADHD cases? 

Mr. BERTONI. I think similar to the speech and language delay. 

We have, again, an impairment that could possibly, according to 

many experts, improve. We know that there is a high approval 

rate, a high cessation rate, and it doesn’t appear to be on the radar 

screen of the agency. I think there is, again, opportunity to look at 

these impairments and do some targeted reviews, again, within the 

current resource structure. And believe me, with additional resources head on into this area, but right now I would guess that 

the numbers of backlog claims in that $1.3 million are disproportionate to the SSI population. So I think there is opportunity here 

to look at that population. 

What is the benefit? The taxpayers certainly benefit. The child 

benefits because they get early intervention, early services, they 

get mainstreamed back into a regular school environment and back 

into perhaps a more productive future. 

Ms. SPEIER. So here is my one concern here with ADHD. Most 

of the recipients are poor families, probably single parents. From 

my discussions with the experts at Social Security, many of these 

people aren’t eligible for SSDI, the parents, so the SSI is the one 

benefit that can come to a family that has no resources. So I understand that. 

But what happens, evidently, is that at age 18 there is a review 

done. If it is determined that you still have ADHD, then that benefit continues into adulthood, which does not make sense. I mean, 

I have a lot of experience with ADHD on a personal level, so we 

need to do something about that point. 

Mr. BERTONI. Almost half of those re-determinations end up 

going into the adult disability population. So the cessation rate, although it is high, upper fifties, you would surmise that those who 

are deemed eligible, are still disabled at that time, are going to go 

into that next phase of disability. 

Ms. NOTTINGHAM. What I see for ADHD claims that come back 

with age 18 for review, we then use the adult standards, so we are 

not using the medical improvement standard at that point, at the 

age 18 re-determination. A lot of those we are not able to find disabled at that point in time. 

101 

Ms. SPEIER. I am sorry, what? 

Ms. NOTTINGHAM. We are usually not able to find someone who 

was allowed for ADHD as a child; we usually don’t find them disabled as an adult, because we are using a new criteria. 

Ms. SPEIER. I think the numbers are actually pretty high, if I remember correctly, the percentage that continue to be. The percentage of children who have ADHD who then continue to have SSI 

after 18 is not a small percentage. 

Ms. LACANFORA. Ms. Nottingham is correct, and so is Mr. 

Bertoni. We actually cease 50 percent of all of the beneficiaries. 

Specific to ADHD, I don’t know off the top of my head, but childhood beneficiaries at age 18 get the de novo review, to use Ms. 

Nottingham’s term. We are not using the medical improvement review standard at that point. By law, the age 18 re-determinations 

look at the claim fresh and we apply the adult disability standards 

and we process an initial claim at that point, not looking at whether they have improved. That is not a requirement. 

Ms. SPEIER. But if they still have difficulty focusing, they still 

have ADHD, and so their benefits can continue. 

Ms. LACANFORA. The medical standards are, obviously, a lot 

more complicated than that, and what we look at is, despite treatment intervention, medication, and so forth, the individual still has 

significant impairments in multiple domains of function. So it is a 

little bit more complicated, but generally those are the more severe 

cases. 

I would also add that there are 74 million children in the United 

States. Less than 2 percent of them get SSI. They are the poorest 

children in the Nation, and 32 percent of the children getting SSI, 

despite the receipt of SSI, are still living in poverty. Without SSI, 

it would be more like 60 percent living in poverty. 

Mr. LANKFORD. Mr. Horsford, just to give you a head’s up, you 

have been here before, this is a second round, so you can jump in 

at any point. 

But I do want to be able to ask Ms. Nottingham you had on your 

statement, to finish up with Ms. Speier was talking about your 

statement, there is to be a consideration of the possibility of requiring treatment for conditions that may improve. The challenge of 

this is if there is a disability that is treatable, that is manageable, 

and we go to ADHD or other things, whether it may be hearing 

loss or they have hearing aids, whatever it may be, a disability 

that is treatable and manageable, how is that then evaluated for 

long-term disability? Is there the possibility, going back to Ms. 

Lockhart’s earlier statement here, how do we get folks back into 

the community if they have a disability, it is being managed, they 

are capable of getting back in the workforce? Do we? 

Ms. NOTTINGHAM. I think this is an area where there is possibly 

room for improvement. We have some conditions where the policies 

are very—maybe the listings address it. Hearing is one thing. 

When we measure their hearing, it is with best correction. Or vision as well. There are some conditions like seizures are ones that 

we are very specific that if they are not following prescribed treatment, then we would not allow them, because most times seizures 

are treatable. 

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There is an exception for following prescribed treatment, it is 

good cause; and usually that is—one of them is access to medical 

care. So you might have a condition, depression, anxiety, ADHD, 

some of these conditions that could very well be improved with 

treatment, but they don’t have access to it, so the hope is when 

they get benefits that they could get treatment and get better; however, at CDR many claims we see do not actually have any treatment. 

The failure to follow prescribed treatment is something that, 

from my experience, is not really used much at CDRs, and I am 

wondering if that is a possibility where we consider that more. 

Mr. LANKFORD. Okay, slow down. Say that last statement one 

more time. 

Ms. NOTTINGHAM. The failure to follow prescribed treatment policy is not something that is really considered at CDR. I don’t know 

if that is the direct policy on that, whether we should be or not, 

but in practice it is not really followed and I am thinking that is 

a possibility of where we can be looking into that more. 

Mr. LANKFORD. Okay, so I want to lean into this. If a person 

could improve, be in the community, be employable if they maintain medication or treatment, or whatever it may be, and they 

choose not to, you are saying that is not considered? Hey, this person still should be listed as disabled because they are not taking 

the treatment that has been prescribed for them? 

Ms. NOTTINGHAM. It depends on the condition. There are some 

that you don’t know, with treatment, how they would do. Some are 

much more likely, like I mentioned seizure disorders, if people get 

treatment on that, they get better and, if not, then they should be 

found disabled. So we would find someone to not be found to be disabled because they are failing to follow prescribed treatment. However, some conditions it is harder to tell how they would respond 

to treatment, like depression or anxiety. But there is little guidance 

on that at this point in time on CDRs and when that would apply, 

outside of a few conditions. 

Ms. LACANFORA. If I might just add one point, and that is we do 

take into consideration a person’s compliance with treatment and 

we do have tools to cease benefits or disallow benefits if a person 

does not comply with treatment, but understand that for medical 

impairments the failure to follow a prescribed treatment is often 

part of the mental impairment; it is not just that the person is trying to be obstinate, it is that they have a serious mental condition, 

whether it be schizophrenia or something else, that creates an intense, let’s say, fear of the medication or fear of the side effects 

that the medication creates. So it is a difficult determination and 

we would be happy to work with NADE and anybody else to clarify 

it or provide training on it, if that would be helpful. 

Mr. LANKFORD. And I am not necessarily talking about the mental illnesses and such. This is a physical thing. If they have a physical disability and they choose not to take medication just because 

they don’t feel a requirement to and say, it doesn’t matter to me 

one way or the other. That is a more serious thing not only for the 

taxpayer, but also for that individual and their families, obviously, 

and somehow we have to have a way to be able to incentivize, saying re-engage in culture. 

103 

Again, I come back to what Ms. Lockhart was saying. It is a very 

big issue to isolate people and to be able to separate them out, and 

we basically discourage them from future work, because if they are 

able to work, we want them to be able to re-engage in culture and 

be able to get back to work. But if benefits and all those things 

suddenly go away, there is no sliding scale, there is no possibility 

to be able to drift off this even when there was a pilot, even; how 

do we help people that are capable of doing that actually being able 

to re-engage. So that is something I think we have to take a look 

at, at how we actually can do that. Is that something you need a 

legislative fix on or is that something you have administrative authority? Can we pilot something or how do we help to be able to 

transition out? 

Ms. Lockhart, are you trying to say something on that as well? 

Ms. LOCKHART. Yes. On the compliance, I just want to add to 

that real quickly. We are currently working with our Department 

of Health, for example, with patients with sickle cell anemia. The 

biggest problem with barrier of care we have is compliance. It is 

simply getting the patients to get to the doctor and follow the protocol they are given. It is not always a psychological issue as much 

as it a socioeconomic or cultural issue. So we work with them on 

education to help them follow those protocols. 

ADHD, our chief rights on the international level, the standards 

for that, I am not sure he would always agree it is a disability, so 

I would welcome you to contact him at any time to follow up on 

that. 

Currently, Oklahoma has 19,475 children in the aid category 

that are receiving some sort of disability aid. My concern, as we are 

talking about all of this, is not are they getting disability or not, 

but what happens to them. Where are they going and what is their 

future? And within these programs the bigger picture. That would 

be my question. 

Ms. LACANFORA. If I might jump in on the bigger picture, which 

goes back to your question about creating self-sufficiency and having people re-engage in the community and be productive members 

of society, we believe at Social Security, as Ranking Member Speier 

said, that we need to pay the right check to the right person at the 

right time. That is the law and we work hard to do that well. But 

we also believe that part of our mission is evolving policy and practice to support people to become self-sufficient and to re-engage. 

And I think at the last hearing I may have mentioned we have 

a research budget and we use that money to test new policies and 

demonstrations, and right now we have a couple right along the 

lines of what you are suggestion. PROMISE is the Promoting Readiness of Minors in Social Security Program. It is an interagency effort to grant money to States around the Country. There are 11 

States participating. And the idea is to create community-based incentives very similar to what Ms. Lockhart is doing, and to figure 

out what community supports will work to help children, in particular, re-engage and become productive potential working members of society as they age. 

Ms. SPEIER. Let me just add that for a number of years I worked 

with the developmentally disabled community in my county, where 

what we were doing was placing adult developmentally disabled in 

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positions, in local grocery stores, at drug stores, in law firms, doing 

meaningful work, getting a paycheck, turning tax receivers into 

taxpayers was one of the lines that was used by this nonprofit, 

with great success. And they were developmentally disabled. So I 

would hope that, as we look at ways to just enhance the program 

and create greater self-sufficiency, that we would look at some of 

the models that exist around the Country. I mean, it is not like we 

are reinventing the wheel here. 

But certainly this PROMISE program, if you have youngsters 

who have speech delays or ADHD, I think it would be really important, when they are still minors, to get them working, getting them 

placed in jobs in the communities so that if in fact 50 percent of 

them are ceasing that benefit at age 18, that there is somewhere 

for them to go in terms of being valued members of society in terms 

of employment. 

Ms. LACANFORA. Absolutely. And the PROMISE program does 

include employment support, placement, benefit counseling, and all 

of those integrated supports that Ms. Lockhart was referring to. 

That is the point of the program. And it is not the first time that 

we have engaged on that front. We have completed the Youth 

Transition Demonstration, which targeted youth between the age of 

14 and 25, and did generally the same thing; we provided community-based supports in many different locations and it proved effective. 

Ms. SPEIER. Well, I guess my point is I think it should be something that we do automatically with most of these youngsters, not 

just as pilot programs. Because if they are successful, let’s fold it 

into the existing—— 

Ms. LACANFORA. Absolutely. Our demonstrations are intended to 

inform the dialogue and provide the Congress with some food for 

thought as you consider legislative changes to the program. 

Mr. LANKFORD. It is not going to be a 16-year prototype, though, 

is it? 

Ms. LACANFORA. No. 

Mr. LANKFORD. We would like to see some progress on. 

Ms. LACANFORA. We have actually completed the Youth Transition Demonstration. The findings are publicly available and there 

are some really interesting things that we found. Community-based 

programs do work. PROMISE is going to, I believe, further corroborate that evidence. 

Mr. LANKFORD. Great. Let me ask about the vocational grid. We 

have talked about this before. I was six, I think, when it was finalized. How are we doing on the vocational grid? 

Ms. LACANFORA. We are doing well. I think there are two pieces 

to this. The first is the update of the occupational information system. That is the dictionary of jobs that you mentioned has not been 

updated in a long time. We have partnered with the Bureau of 

Labor Statistics. We are cooking along. 

Mr. LANKFORD. Our date for that to be completed? 

Ms. LACANFORA. Our date is 2016, when we believe we will have 

something useful. 

Mr. LANKFORD. Still on track. 

Ms. LACANFORA. We are on track, absolutely. The grids is a 

slightly different, yet very much related issue. You know, and we 

105 

discussed it at the last hearing, we attempted rulemaking on the 

grids in the past and we were shut down, essentially, and the reason for that is that we did not have an evidence base behind the 

proposal that we made to increase the age limits in the grid; and 

when we got questions about the disproportionate effects to minorities and other questions, we didn’t have the science to back it up. 

We learned from that experience; we are not going to make that 

mistake again. 

So we are, as I described to you before, in the process of building 

our evidence base to support logical changes to the grid, and we are 

well under way. We are working with the Disability Research Consortium and the Library of Congress. We are engaging them in a 

literature review to look at how other disability systems, both 

internationally and in the private sector, use age, education, and 

work in their systems so that we can learn from that and shape 

our own policy. 

Mr. LANKFORD. The date for that? 

Ms. LACANFORA. The initial phase of literature review from the 

Disability Research Consortium, we expect their report in a couple 

of months. 

Mr. LANKFORD. Okay. Is that something that will be available to 

us as well to be able to review? 

Ms. LACANFORA. Yes. 

Mr. LANKFORD. How publicly available is that? 

Ms. LACANFORA. We can share. We can share the findings with 

the committee. 

Mr. LANKFORD. So we are talking July-ish, somewhere through 

there? 

Ms. LACANFORA. Yes. Now, understand that is the first phase of 

our exploration. 

Mr. LANKFORD. I understand. That is getting the science out 

there to be able to review it. Then the next part of it, after that 

is done, then it is a matter of starting to make the recommendations. 

Ms. LACANFORA. Exactly. 

Mr. LANKFORD. You hope to get all this together by 2016, but the 

vocational grid and the other recommendations, get them to complete proposal? 

Ms. LACANFORA. That would be ideal, yes. It really depends on 

what we find in the exploration. Remember that the law requires 

us to consider age, education, and work as part of the determination. How we do that needs to evolve over time, as people work 

longer and so forth. But it is a very complicated analysis. So we 

are in the fact-finding stage. 

Mr. LANKFORD. Okay, let me ask another question we have 

talked about before, and that is the high rate of reversal judges for 

the ALJs, whether it be Judge Daltry or any number of others 

there. You have CDR funds that have been allotted. You have said 

you are setting aside some of those for the high priority cases. Are 

those some of the high priority cases that you are actually targeting, some of these high reversal ALJs? 

Ms. LACANFORA. Yes. 

Mr. LANKFORD. Okay. How is that coming so far? 

106 

Ms. LACANFORA. So we have been looking at this from a legal 

standpoint, because you know we try hard to respect judicial independence of our ALJs, so there are some legal parameters that we 

need to work within, and we have been working hard to kind of figure out a path forward. But we believe that we are going to get 

to where this committee wants us to be and where we need to be 

by looking at the cases that have the potential of being out of policy 

compliance. 

In other words, we know what cases are problematic from a policy standpoint, and we are going to target those cases; and in doing 

so we will get to a lot of the decisions that were problematic and 

made by those judges that were outliers or that were high allowance rate judges. And we will take those cases and put them to the 

front of the CDR pipeline. So we will do CDRs. 

Mr. LANKFORD. So give me a date on that. When does that begin? 

Ms. LACANFORA. We are going to start that now. 

Mr. LANKFORD. Okay, that is ongoing now. One other quick question on the medical improvement definition GAO. You have some 

thoughts on this as well, Mr. Bertoni, I understand, of how we handle this. 

Mr. BERTONI. Well, in our report essentially there was much confusion about how to apply some of the provisions in terms of the 

exceptions; how much improvement in medical capacity was sufficient to determine or make a judgment of cessation. It just wasn’t 

clear. There was a lot of confusion. We surveyed every DDS director and a number of examiners, had a 95 percent response rate, I 

believe, and there was a lot of confusion as to how to apply those 

two critical provisions. And we asked the agency to go in and put 

some more granularity around those instructions. It hasn’t occurred, and we still think it needs to. 

Mr. LANKFORD. How does that happen? 

Mr. BERTONI. That is in SSA’s ball court, ball whatever, field. 

Mr. LANKFORD. Ms. LaCanfora, it is on your desk. How does that 

happen? 

Ms. LACANFORA. So it has happened. We have done training on 

the medical improvement review standard and the exceptions. 

However, as I mentioned before, we have lost 11,000 people. The 

lack of funding has resulted in high turnover in the DDSs, so training is not a one-time thing; we need to do continual training. We 

have been reviewing cases where the medical improvement review 

standard was utilized and we are looking at where we need to provide new improved training and clarity, and we will do that. And 

we are happy to work with NADE to do that. 

Mr. LANKFORD. And the goal here, again, is to get people back 

out to work. We are all on this dais we are all unanimous. There 

needs to be a safety net for the most vulnerable. But if there is an 

expected return to work, how do we help transition people back out 

to work and be evaluated? When they are in a vulnerable moment 

that our society comes alongside of them, but also incentivizes that 

there is an end-date for people that are expected to have returned, 

so how do we help you in that process. 

So the medical improvement, and this definition becomes very 

helpful to us to know that it is not a matter you are 100 percent 

back, you are not going to be 100 percent back. Everyone lives with 

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aches and pains. My ranking member lives with aches and pains 

all the time from past injuries. She is doing extremely well. So 

there are other people I have talked about before in my own family, 

in a wheelchair, all sorts of different medical issues that do extremely well vocationally. How do we help incentivize that and to 

be able to encourage people to re-engage with culture, again going 

back to what Ms. Lockhart asked. 

So I am not saying we have to determine that today. I am saying 

from this panel we want to see a way that medical improvement 

is clear and that they see improvement not back to 100 percent, 

but see improvement where they can re-engage again for the sake 

of their families and our economy. 

Mr. BERTONI. Mr. Chairman, earlier you talked about the initial 

decision and not being able to overturn a case on the initial decision. It is really the last decision. In many cases, in our work, it 

was the ALJ decision that the DDSs were revising in CDR, and the 

information just wasn’t there to determine medical improvements. 

So I really think the agency needs to look at reconciling the tools 

that they have at the initial level, and I think they are doing some 

things there to standardize and to get enough information in the 

record, where you can revisit and determine medical improvement. 

I think there are real issues at the ALJ level, where that tool just 

doesn’t exist yet. I know they are thinking about it, but I think 

something needs to happen there. 

Ms. SPEIER. I am not following you. What tool are you talking 

about at the ALJ level? 

Mr. BERTONI. I don’t believe there is at this point. At least at the 

DDS level we have eCAT, which provides a platform for the examiners to more thoroughly document their rationale for the decision. 

And if you had to revisit that in a CDR, perhaps you would have 

more information to document medical improvement. 

At the hearings level, at least in our work, most of the concern 

was that when the DDS revisited that case in a CDR that was decided at the hearings level, the information was not there; there 

wasn’t enough information to document medical improvement; and 

the agency, I think, needs to look to additional tools that the ALJs 

can use to document more thoroughly that rationale. When you are 

under pressure to process claims, 700 a month, it is real easy to 

fly through these claims with limited rationale; and in the event 

of a CDR there is not enough there for the DDS representative to 

make a decision. 

Ms. SPEIER. So are you saying that the ALJ, because they don’t 

have enough information, tends to continue the benefit, but doesn’t 

document it enough? Is that what you are saying? 

Mr. BERTONI. I would say in our case, in our review, the concern 

was that when the DDS examiner received the CDR for review, 

and the last person who touched it was an ALJ, that decision, that 

justification did not have sufficient information for them to determine medical improvement. So there could be an opportunity to 

provide additional tools at the ALJ level so that decision is more 

thoroughly documented, the rationale is there for the DDS examiner, should there be a CDR, to make a determination of medical 

improvement. 

108 

Ms. SPEIER. And the ALJ typically has attorneys write their decisions, correct? 

Mr. BERTONI. I will defer to the agency on that. I know that happens; I don’t know to what extent. 

Ms. LACANFORA. That is true. There are four support staff to 

every ALJ. I do want to agree with Mr. Bertoni, though, in terms 

of the importance of documentation. He mentioned eCAT, which is 

the electronic case analysis tool. It is basically a tool that the DDSs 

use to thoroughly document the rationale for their decisions. We 

love that took because it inspires policy compliance consistency 

across the board. We are implementing a version of that with the 

ALJs, we call it the electronic bench book, but it is essentially the 

same thing. Think of it as sort of a tool that pads you through the 

decision and makes you document your rationale. 

Mr. LANKFORD. When? 

Ms. LACANFORA. I have to get back to you on that one. I have 

to ask Mr. Sklar what his plan is. 

Mr. LANKFORD. But we are thinking in the next year, the next 

five years? What are you thinking? Give me a ballpark. 

Ms. LACANFORA. Probably somewhere in between for a full rollout. 

Mr. HORSFORD. Mr. Chairman? Mr. Chairman, I want to break 

in here because I want to ask about the continuing disability reviews, which was the primary purpose for the hearing today, and 

talk about this annual report on continuing disability reviews report that was done by the SSA that found that the Government 

saved approximately $5.4 billion in fiscal year 2011 alone as a result of completed continuing disability reviews. I think, from what 

I understand, part of this problem is a huge backlog and a lack of 

staff resources at the front end of the process where the initial determinations are made, is that correct? 

Ms. LACANFORA. Yes. 

Mr. HORSFORD. So what are the current barriers, then, to conducting more medical CDRs? 

Ms. LACANFORA. We need adequate, sustained, and predictable 

funding; and that is the number one way to get current on medical 

CDRs. The only way. 

Mr. HORSFORD. So the chairman and the ranking member sent 

an 11-page letter yesterday regarding recommendations for improvements to the disability program. What were some of the examples of how SSA is already addressing some of those concerns? 

Ms. LACANFORA. Well, the committee suggested, for example, 

that we ensure that claimant representatives give us all of the evidence at their disposal, and we have actually already done that. 

We have a notice of proposed rulemaking out for comment right 

now; it went out on February 20th. The comment period is open, 

so we are already there. 

Mr. HORSFORD. And what is the estimated number of positions 

that you need based on the current backlog that is in place? 

Ms. LACANFORA. I will give you a dollar amount. In fiscal year 

2014, we were given the Budget Control Act level of funding, 

$1.197 billion, to do program integrity work. In fiscal year 2015 we 

need from the Congress $1.396 billion for program integrity. Subsequent to fiscal year 2015, the President’s budget has a proposal for 

109 

mandatory sustained funding for program integrity, and we hope 

that the Congress will support it. That is what we need to get the 

job done and to eliminate this backlog of medical CDRs. 

Mr. HORSFORD. So despite the fact that every dollar that is spent on CDRs saved the Federal Government $9, that lack of funding, 

in large part, is what is contributing to this 1.3 million backlogs 

of CDRs. 

Ms. LACANFORA. That is the reason. 

Mr. HORSFORD. So, Mr. Chairman, I would just ask that we enter 

this report into the record. I agree that there are a number of different policy and operational recommendations that need to be implemented, but I also think that the main thing we need to do as 

Congress is to properly fund and resource where there is the greatest return on investment, and that is through the CDRs. That is 

the front-end part of the process. 

I know we had an extensive hearing about the ALJs and whatever discretion that they have, and that is an important discussion, 

but I just feel like the meat of the problem is at the front-end, and 

it is really about a lack of resources to a program that we know, 

when you fund it, it works and it provides the types of medical reviews that are necessary. 

So I yield back. 

Ms. SPEIER. Ms. LaCanfora, the inspector general had put up 

that one photo of the rock band star who obviously was provided 

benefits inappropriately. Have you clawed back that money? 

Ms. LACANFORA. I don’t know that specific case. I will say that 

we identified that case and referred it to the inspector general. 

Ms. SPEIER. All right. Would you just inform us as to whether 

or not you have attempted to claw back that money? 

Ms. LACANFORA. Sure. 

Ms. SPEIER. All right. 

And then to you, inspector general and to you, Mr. Bertoni, you 

have spent a lot of time in this issue area, and I would like to just 

know from each of you recommendations you would make to us for 

improvements to the system beyond what you have provided. And 

I guess to you, Mr. Bertoni, if there is another issue area that you 

think we should be requesting you to look at at the GAO, we would 

be happy to make that request of you to kind of make the system 

work more effectively. 

Mr. BERTONI. Well, I think we have done a lot of work on the 

front-end of the process, looking at the initial claims process, SSA’s 

processes for moving claims through the system. I think there are 

opportunities to gain some efficiencies there. I understand the resource issues, I certainly do, but again I think there are opportunities for efficiencies there to be able to process claims more quickly 

and smoothly. 

I think there is opportunity in the area of quality assurance to 

make sure that if we are in an environment where we have a backlog situation, we are telling people to process a lot of claims, that 

we also keep our eye on the quality assurance piece so that these 

are not only quickly processed, but accurately processed. And ultimately I think follow-on work, I would be interested in doing a topto-bottom review of the medical continuing disability review process, the CDR process, some of the assumptions, some of the forVerDate Aug 31 2005 11:36 May 15, 2014 Jkt 000000 PO 00000 Frm 00113 Fmt 6633 Sfmt 6633 C:\DOCS\87819.TXT APRIL
110 

mulas, things that are being used to drive these reviews. I think 

that would be great work. 

Ms. SPEIER. Mr. O’Carroll? 

Mr. O’CARROLL. Just a couple things, and I guess this is a good 

time to say it. I think one of the common tones or themes throughout this hearing has been what we talk about all the time. There 

is a balance between stewardship and service, and one of the 

things I guess that has come out, and I was looking at my numbers 

as we were sitting here, is that there is about—we are talking 

about the 1.3 backlog on CDRs, million backlog on it, and there is 

about that same, if not more, backlog for initial claims going into 

SSA. So the agency has to make that balance out between stewardship and the service part of it. 

Our job is to keep reminding them about the fraud, waste, and 

abuse side of it. And I think one of the other themes from this 

thing has been if we prevent the fraud, one prevention is best. Let’s 

get the money before it goes out the door and prevent it. That is 

the reason why the CDI units have been so effective. And along 

that same line, with the CDI units, we bank now about $10 billion 

in savings by using the CDI units, and going back to what Mr. 

Cummings was talking about in terms of the trust fund on it, that 

might equate to $10 billion, it would be about an extension of a 

month into the trust fund, which is a big deal. So my feeling is that 

these anti-fraud initiatives are major money savers for the trust 

fund and it is something that are very successful and we can show 

it. 

So, anyway, one other thought on the funding part that we were 

talking about, too, was that we suggested a number of times, we 

put it every year when we go to OMB for our budget presentation, 

we put it in each time with our appropriators, is an integrity fund 

for SSA. And with that integrity fund is with the $3 billion-plus 

that are recovered every year in terms of overpayments, if SSA 

could have access to some of that money. What we have suggested 

is 25 percent of that money, and use that for the anti-fraud initiatives like CDRs and other things that would fund it; it wouldn’t 

need any additional funding for it. 

One of the other things we would like is if the IG could get a 

percentage of that, we can use that for expansion of the CDI program and be better able to address the 22,000 disability referrals 

we get from SSA every year. In terms of our resources that we 

have, we are doing about 10,000 cases from the resources that we 

are getting, and we could do a lot more if we had more resources, 

and I think an integrity fund, instead of coming and asking for a 

bigger appropriation, would be very helpful. 

Mr. LANKFORD. What is the source of the integrity funding? 

Mr. O’CARROLL. Integrity fund would be the recovered dollars 

that are coming from the recovery of overpayments. So SSA is 

banking $3.26, I think, in overpayments every year that are recovered, so instead of that going back into the trust fund or into the 

general fund, which some of the money goes back to, redirect that 

back into anti-fraud initiatives. 

Mr. LANKFORD. Okay. I have one last question, unless you have 

additional things, and that is this issue that you referred to the 

111 

bench data system that is trying to line up, the eCAT and then 

there was the other one. 

Ms. LACANFORA. The electronic bench book. 

Mr. LANKFORD. The electronic bench book. Until that is up to 

speed, we are still going to have an issue with ALJs that have final 

basically document that we can’t track all the reasons for and all 

the policy documents for. So when we come back to do CDRs, it is 

not written in such a way that we can really evaluate medical improvement. 

Ms. LACANFORA. Let me say that we have no indication that that 

is a widespread problem. Certainly we want the ALJs to do extensive documentation, and the electronic bench book will help that, 

but under current policy and process they are doing that today; and 

there are always going to be cases where we don’t do as good a job 

as others, but I don’t have an indication that that is a systemic 

problem. 

Mr. LANKFORD. Okay. Anyone else experience that? Ms. Nottingham? 

Ms. NOTTINGHAM. I would disagree with that. The most common 

complaint I hear from other examiners about ALJs is that the allowances are not well documented. I can tell you that the denial 

decisions that they do usually are well documented, but the allowances, it is very hard for us to make a finding of medical improvement when we don’t really know what they were allowed for. It is 

sometimes difficult to really see what their rationalization was 

when there is—you know, their rationalization on the decision on 

a denial might be 9 or 10 pages long; whereas, an allowance is generally like 1 or 2 pages. 

Mr. LANKFORD. Tough to be able to tell on that, then, 1 or 2 

pages. So when we are dealing with that, how do we process this 

in the meantime? We have something coming in the future with 

the bench book. How do we deal with medical improvement until 

we get that in place? 

Ms. LACANFORA. Let us get back to you on the bench book, because I don’t want to speak prematurely, but I believe we are already well into the rollout of the electronic bench book. 

Mr. LANKFORD. Okay. 

Okay, final questions or thoughts? Anyone else have final questions or thoughts as well? 

Long day. Thanks for allowing us to be able to pummel you with 

questions. We want to help in this process and I appreciate what 

everybody is doing to be able to serve some of the most vulnerable 

in our society. So thank you. 

With that, we are adjourned. 

[Whereupon, at 4:10 p.m., the subcommittee was adjourned.] 

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