United States General Accounting Office

GAO Report to the Chairman, Subcommittee

on Social Security, Committee on Ways

and Means, House of Representatives

August 1997 SOCIAL SECURITY

DISABILITY

SSA Must Hold Itself

Accountable for

Continued

Improvement in

Decision-making

GAO/HEHS-97-102

GAO United States

General Accounting Office

Washington, D.C. 20548

Health, Education, and

Human Services Division

B-270669 

August 12, 1997

The Honorable Jim Bunning

Chairman, Subcommittee on Social Security

Committee on Ways and Means

House of Representatives

Dear Mr. Chairman:

This report, prepared at your request, evaluates the Social Security Administration’s

decision-making process for disability determinations and assesses its efforts to improve the

process.

As agreed with your office, we are sending copies of this report to the Commissioner of the

Social Security Administration and the Director of the Office of Management and Budget. We

will also make copies available to others on request.

If you have any questions about this report, please call me at (202) 512-7215. Other major

contributors to this report are listed in appendix IV.

Sincerely yours,

Jane L. Ross

Director, Income Security Issues
Executive Summary

Purpose Each year, about 2.5 million people apply to the Social Security

Administration (SSA) for disability benefits. Disability determination

services (DDS), which are state agencies that conduct disability

determinations on behalf of SSA, award benefits to about 35 out of every

100 of these initial applicants. Of the 65 denied applicants, about 43

abandon their claims, and about 22 appeal to administrative law judges

(ALJ). On appeal, 14 of 22 claimants, or almost two-thirds, are subsequently

awarded benefits. This rate of ALJ benefit awards raises concerns in the

Congress and elsewhere about the accuracy of disability DDS and ALJ

decisions, length of time claimants must wait for a decision if they appeal,

and costliness of deciding cases on appeal rather than upon initial

application.

In 1995 testimony before the Social Security Subcommittee of the House

Committee on Ways and Means, GAO reported on the timeliness and

consistency of SSA’s disability decisions.1

 On the basis of that testimony,

the Chairman asked GAO to report on (1) factors that contribute to

differences between DDS and ALJ decisions and (2) SSA’s actions to make

decisions in initial and appealed cases more consistent. This report details

GAO’s findings, which were reported in testimony earlier this year.2

Background SSA operates the Disability Insurance (DI) and Supplemental Security

Income (SSI) programs—the two largest federal programs providing cash

benefits to people with disabilities. The law defines disability for both

programs as the inability to engage in any substantial gainful activity by

reason of a severe physical or mental impairment that is medically

determinable and is expected to last at least 12 months or result in death.

The programs have grown in the last 10 years, and today over 7 million

working-age adults are on the rolls. These and other beneficiaries receive

cash benefits totaling about $61 billion a year.3

Disability determinations begin at the DDSs, where a disability examiner

and a medical or psychological consultant, working as a team, analyze an

applicant’s documentation, gather additional evidence as appropriate, and

make a disability determination. Denied applicants may ask the DDS to

1

Social Security Disability: Management Action and Program Redesign Needed to Address

Long-Standing Problems (GAO/T-HEHS-95-233, Aug. 3, 1995).

2

Social Security Disability: SSA Actions to Reduce Backlogs and Achieve More Consistent Decisions

Deserve High Priority (GAO/T-HEHS-97-118, Apr. 24, 1997).

3

Included in the $61 billion of benefits are payments to all SSI blind and disabled beneficiaries

regardless of age.

Page 2 GAO/HEHS-97-102 SSA Accountability for Decisions
Executive Summary

reconsider its finding, and if denied again, may appeal to an ALJ. The ALJ

usually conducts a hearing and must consider the findings of the DDS

medical consultant but is not legally bound by them. In addition, claimants

may testify before an ALJ and present new evidence. Claimants whose

appeals are denied may request review by SSA’s Appeals Council and then

may file suit in federal court. The average initial DDS decision in DI cases

costs about $540, though a hearing can cost an additional $1,200. In

addition, appeals can add an average of 378 days to the length of time that

a claimant must wait for a final decision.

Both DDS and ALJ adjudicators use a sequential evaluation process when

determining disability. Under this process, applicants are awarded benefits

when their medical condition meets or equals criteria in SSA’s regulations

(commonly referred to as the medical listings). For those whose condition

does not meet or equal the listings, the adjudicators focus on the

functional consequences of applicants’ medically determined impairments.

As part of its 1994 plan for redesigning the disability determination

process, SSA set a goal of “making the right decision the first time.” As a

first step, SSA has begun an initiative, called process unification, to

improve the consistency of its decisions. Under redesign, the agency

expects more award decisions to be made by the DDSs, reducing the need

for appeals. Meanwhile, SSA faces several other competing demands,

including significant increases in continuing disability reviews and

increasing SSI workloads mandated by recent legislation.4

 Over the longer

term, SSA plans to improve its methods for assessing applicants’ capacity to

function in the workplace.

Results in Brief ALJs made nearly 30 percent of all awards in 1996. Moreover, because

two-thirds of all cases appealed to ALJs have resulted in awards, questions

have arisen about the fairness, integrity, and cost of SSA disability

programs. Differences in assessing applicants’ functional capacity and

procedural factors, as well as weaknesses in quality assurance, contribute

to inconsistent decisions.

Differences in assessing functional capacity help explain the inconsistent

decisions of ALJs and DDSs. ALJs are far more likely than DDSs to find

claimants unable to work on the basis of their functional capacity.

4

The Social Security Independence and Program Improvements Act of 1994 and the Personal

Responsibility and Work Opportunity Reconciliation Act of 1996 increased claims workloads for drug

addicts and alcoholics, noncitizens, and children on SSI, and both significantly increased SSA’s

requirements to conduct continuing disability reviews.

Page 3 GAO/HEHS-97-102 SSA Accountability for Decisions
Executive Summary

Moreover, this outcome has occurred even when ALJ and DDS adjudicators

review the same evidence for the same case. Most notably, DDS

adjudicators tend to rely on medical evidence such as the results of

laboratory tests; ALJs tend to rely more on symptoms such as pain and

fatigue. In addition, the opinions of claimants’ own physicians may more

likely influence ALJs than DDSs; DDSs may give more weight to other medical

evidence such as laboratory findings.

DDS and ALJ decision-making practices and procedures also contribute to

inconsistent results because they limit the usefulness of DDS evaluations as

bases for ALJ decisions. For instance, DDSs often do not ensure that medical

consultants write adequate explanations of their opinions. SSA regulations

require ALJs to consider these explanations, but this has little practical

value if the explanations are not well documented. In addition, SSA

procedures often lead to substantial differences between the evidentiary

records examined by DDSs and ALJs. Specifically, ALJs may examine new

evidence submitted by a claimant and hear a claimant testify. As a result,

even with a well-explained DDS decision, ALJs could reach a different

decision because the evidence in the case differs from that reviewed by

the DDS.

Finally, SSA has not used its quality review systems to identify and

reconcile differences in approach and procedures used by DDSs and ALJs. In

fact, the quality review systems for the initial level and appeals levels of

the decision-making process merely reflect the differences between the

levels; they do not help produce more consistent decisions.

Although SSA has not managed the decision-making process well in the

past, its current process unification initiatives, when fully implemented,

could significantly help to produce more consistent decisions. Competing

workload pressures at all adjudication levels could, however, jeopardize

SSA’s efforts. As a result, SSA, in consultation with the Congress, will need

to sort through its many priorities and be more accountable for meeting its

deadlines and establishing explicit measures to assess its progress in

reducing inconsistency. This may include, for example, setting a goal,

under the Government Performance and Results Act, to foster consistency

in results, set quantitative measures, and report on its progress in shifting

the proportion of cases awarded from the ALJ to the DDS level.

Page 4 GAO/HEHS-97-102 SSA Accountability for Decisions
Executive Summary

Principal Findings

DDSs and ALJs Differ

Mainly Over Claimants’

Functional Abilities

Differences in assessing claimants’ residual functional capacity (RFC) by

DDSs and ALJs are the main reason for most ALJ awards, according to GAO’s

analysis. ALJs are much more likely than DDSs to find that claimants have

severe limitations in functioning in the workplace, as indicated by an

ongoing SSA study of the appeals process. For instance, in the view of

awarding ALJs, 66 percent of cases merited an RFC of “less than the full

range of sedentary work”—a classification that often leads to an award. In

contrast, DSS reviewers found that less than 6 percent of the cases

merited this classification. DDS and ALJ differences in assessments were

also apparent in a 1982 SSA study that controlled for differences in

evidence. This study indicated that DDS and ALJ adjudicators often reach

different results even when presented with the same evidence.

Specifically, DDS reviewers would have awarded benefits in 13 percent of

the cases, while ALJs would have awarded benefits in 48 percent of the

cases.

The use of medical experts and the application of judgment in weighing

evidence seem to influence the differences in DDS and ALJ decisions. For

example, at the DDSs, medical or psychological consultants assess

applicants’ RFC. DDSs appear to rely more on objective medical findings

when assessing the impact of symptoms, such as pain and fatigue, on

functional capacity. In contrast, ALJs have the sole authority to determine

RFC and often rely on a claimant’s testimony and treating physicians’

opinions. Although ALJs may have independent medical experts testify at

hearings, only about 8 percent of cases in which benefits are awarded have

used such experts, according to our analysis.

SSA issued rulings in July 1996, which were written to clarify ALJs’ use of

DDS medical consultants’ findings, treating source opinion, and assessing

RFC. In addition, SSA plans to issue a regulation to provide further guidance

on assessing RFC for both DDSs and ALJs, specifically clarifying when a

“less-than-sedentary” classification is appropriate. SSA expects this

classification to be used rarely.

DDS Evaluations of

Limited Use to ALJs

Several factors at both the DDS and ALJ levels limit the usefulness of DDS

evaluations as bases for ALJ decisions. Often, ALJs cannot rely on DDS

evaluations because they lack the supporting evidence and explanations of

Page 5 GAO/HEHS-97-102 SSA Accountability for Decisions
Executive Summary

the reasons for the denial, laying a weak foundation for an ALJ decision if

an applicant appeals the case. Moreover, although SSA requires ALJs to

consider the DDS medical consultants’ assessments of RFC, DDS procedures

do not ensure that such assessments are clearly explained. Without this,

an ALJ could neither effectively consider such assessments nor give them

much weight.

At the ALJ level, claimants may submit additional evidence and claim new

impairments. This also affects the consistency of DDS and ALJ decisions.

Claimants submit additional evidence in about 75 percent of appealed

cases; and, in about 27 percent of hearing allowances, additional evidence

is an important factor in the decision. In about 10 percent of appealed

cases, claimants switch their primary impairment from a physical to a

mental one.

SSA has acknowledged the need to ensure that DDS decisions are better

explained and based on a more complete record so that they are more

useful if appealed. The agency plans to issue instructions and provide

additional training for the DDSs on how and where in the case files to

explain their decisions and on explaining the decisions. SSA also plans to

issue a regulation clarifying the reliance on DDS medical consultants’

opinions at the ALJ level. To deal with the possible effect of new evidence,

SSA plans to return about 100,000 selected cases a year to the DDSs for

further consideration when new evidence is introduced at the ALJ level.

The DDSs might award benefits at this point, eliminating the need for costly

and time-consuming ALJ hearings.

Quality Review Systems

Neither Identify nor

Reconcile Inconsistency

Between DDS and ALJ

Decisions

SSA has several quality review systems for disability decisions, each with

its own specific purpose; none, however, is designed to identify and

reconcile factors that contribute to differences between DDS and ALJ

decisions. For example, although ALJs must consider as evidence medical

consultants’ conclusions about claimants’ functional capacity, DDS quality

reviews do not focus adequate attention on explaining these conclusions

in the record. Moreover, SSA reviews of ALJ awards are too limited to

ascertain whether ALJs appropriately consider this evidence or whether

DDS explanations could be made more useful to ALJs. Feedback about both

of these issues—DDSs’ explanations of decisions and ALJs’ consideration of

them—would help improve SSA’s reviews of DDS and ALJ decisions and

make DDS decisions more useful to ALJs.

Page 6 GAO/HEHS-97-102 SSA Accountability for Decisions
Executive Summary

SSA has started to focus its quality reviews on achieving greater

consistency between DDS and ALJ decisions. In late 1996, the agency started

to increase its reviews of ALJ awards, setting a first-year target of 10,000

cases. In the longer term, SSA plans to unify its DDS and ALJ quality review

processes, providing systematic review of decision-making. The agency

hopes this will ensure that the correct decision is made at the earliest

point in the process.

Recommendations GAO supports SSA’s process unification initiatives and recommends that SSA,

using available systems and data collected so far, move quickly ahead to

implement its quality assurance initiative to provide consistent feedback

to DDS and ALJ adjudicators as soon as possible. In addition, SSA should

expand its effort to return cases to DDSs for their review when new

evidence is introduced on appeal.

GAO also recommends that SSA set specific goals for measuring the

effectiveness of process unification in reducing inconsistent decisions.

Agency Comments In its written comments on a draft of this report, SSA stated that the goal of

process unification was the linchpin of the agency’s disability redesign

efforts and that GAO’s findings and suggestions would help SSA achieve this

goal. SSA generally agreed with GAO’s conclusions and recommendations

and provided specific comments and observations about areas of the

report that it believed should be changed. Where appropriate, GAO has

revised the report. A number of SSA’s specific comments and GAO’s

evaluation of these comments appear in chapter 6; the full text of SSA’s

comments and GAO’s response appear in appendix III.

Page 7 GAO/HEHS-97-102 SSA Accountability for Decisions
Contents

Executive Summary 2

Chapter 1 

Introduction

12

Claimants May Pursue Several Levels of Appeal 12

ALJ Procedures Foster Independent Decision-making 16

Differences in Decision Results Are Long-standing 17

Decision-making Process Yields Much Inconsistency Between

DDSs and ALJs

19

Recent SSA Efforts to Reduce Inconsistency 20

Objectives, Scope, and Methodology 22

Chapter 2 

Disability

Decision-making: A

Complex Process

Requiring Much

Judgment

23

DDSs and ALJs Use a Standard Approach, the Sequential

Evaluation Process

23

Chapter 3 

DDSs and ALJs Differ

Most When Assessing

Residual Functional

Capacity

33

Most ALJ Awards Result From RFC Assessments That Differ

From Those of DDSs

33

DDSs and ALJs Differ in Their Decision-making Approaches 35

Effect of Differences in Policy Documents Difficult to Assess 36

SSA Is Taking Actions to Improve Consistency of Decisions 37

Chapter 4 

DDS Evaluations of

Limited Use to ALJs

39

DDS Medical Consultants Often Inadequately Explain RFC

Assessments

39

ALJ Awards Are Often Based on Information Not Available to

DDSs

40

Effect of Other Factors Does Not Appear Major or Is More

Difficult to Substantiate

42

SSA’s Planned Improvements in Procedures 43

Page 8 GAO/HEHS-97-102 SSA Accountability for Decisions
Contents

Chapter 5 

Quality Reviews Do

Not Focus on

Inconsistency

Between DDS and ALJ

Decisions

45

Quality Reviews Not Designed to Address Differences 45

Current Quality Reviews Mirror Differences in Approach and

Procedures

47

SSA Has Plans to Improve Quality Reviews 49

Chapter 6 

Conclusions,

Recommendations,

Agency Comments,

and Our Evaluation

51

Conclusions 51

Recommendations 52

SSA’s Comments and Our Evaluation 53

Appendixes Appendix I: DDS and ALJ Disability Decisions and Operations 56

Appendix II: SSA Studies Addressing Differences Between DDS

and ALJ Decision-making

60

Appendix III: Comments From the Social Security Administration

and Our Evaluation

68

Appendix IV: GAO Contacts and Staff Acknowledgments 75

Tables Table 1.1: Levels of Appeal and Actions Taken by Disability

Adjudicators

13

Table 1.2: Award Rates by DDSs and ALJs by Impairment Type 19

Table 1.3: Back Impairment Award Rates by DDS and ALJs by

Claimant Age

20

Table 2.1: Five-Step Sequential Evaluation Process for

Determining Disability

24

Table 2.2: Definition of Five Exertional Demand Categories 27

Table 2.3: Directed Decisions Under Medical-Vocational Rules for

Applicants Aged 50 or Older Whose Exertional Ability Is Limited

to Sedentary Work

28

Table 2.4: Directed Decisions Under Medical-Vocational Rules for

Applicants Under Age 50 Whose Exertional Ability Is Limited to

Full Range of Sedentary Work

29

Table 2.5: Factors Adjudicators Consider in Weighing Medical

Opinions

31

Page 9 GAO/HEHS-97-102 SSA Accountability for Decisions
Contents

Table 3.1: DDS and ALJ Differences in RFC Assessment

Classifications for Physical Impairment Awards

34

Table 4.1: SSA Reviews Differ by Organization Reviewed and

Purpose

45

Table I.1: DDS Decisions—September 1992 Through April 1995 56

Table I.2: ALJ Decisions—September 1992 Through April 1995 57

Table I.3: DDS and ALJ Operations, FY 1986 Through First

Quarter, FY 1997

58

Table II.1: Design of SSA’s Bellmon Study 61

Table II.2: Three-Tier DHQRP 65

Figures Figure 1.1: Disability Appeals Process and Outcomes 15

Figure 1.2: ALJ Awards as a Proportion of All Awards, FYs

1986-96

18

Abbreviations

ALJ administrative law judge

APA Administrative Procedure Act

CDR continuing disability review

DDS disability determination service

DHQRP Disability Hearings Quality Review Process

DI Disability Insurance

HALLEX Hearings, Appeals, and Law Litigation Manual

IG Office of the Inspector General

OHA Office of Hearings and Appeals

OPIR Office of Program and Integrity Reviews

PER pre-effectuation review

POMS Program Operations Manual System

RFC residual functional capacity

SSA Social Security Administration

SSI Supplemental Security Income

SSR Social Security Ruling

Page 10 GAO/HEHS-97-102 SSA Accountability for Decisions
Page 11 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 1 

Introduction

The Social Security Disability Insurance (DI) and Supplemental Security

Income (SSI) programs are the two largest federal programs providing cash

payments to people with long-term disabilities. The DI program, authorized

in 1956 under title II of the Social Security Act, provides monthly cash

insurance benefits to insured, severely disabled workers. The SSI program,

authorized in 1972 under title XVI, provides monthly cash payments to

aged, blind, or disabled people whose income and resources fall below a

certain threshold. About 2.5 million people apply to the Social Security

Administration (SSA) each year for disability benefits.

Between 1985 and 1995, the number of DI beneficiaries increased about 53

percent to about 5.0 million, and the number of working-age SSI recipients

increased 81 percent to 2.4 million. In 1995, SSA distributed about

$61 billion to these and other disability beneficiaries and spent $3 billion

on program administration, which accounted for more than half of SSA’s

total administrative expenses.5

Both the DI and SSI programs are administered by SSA and state disability

determination services (DDS), which determine benefit eligibility. DDSs

award benefits to about 35 percent of applicants.6

 Denied applicants may

appeal to an administrative law judge (ALJ) in SSA’s Office of Hearings and

Appeals (OHA). About a third of all applicants found not disabled by DDSs

appeal to an ALJ, and almost two-thirds of claimants who appeal to an ALJ

are subsequently found disabled.

Cases appealed to ALJs add considerably to SSA’s administrative expense

and increase the time claimants must wait for a decision. The average

initial DDS decision in DI cases costs about $540, while a hearing can cost

an additional $1,200. In addition, appeals can add an average of 378 days to

the length of time that an applicant must wait for a final decision.

Moreover, because ALJs award a high percentage of appealed cases that

have already been denied twice by the DDS, the integrity of the process is

called into question.

Claimants May Pursue

Several Levels of

Appeal

Claimants apply for DI and SSI disability benefits in SSA field offices, which

forward these applications, along with any supporting medical evidence,

to the appropriate state DDS. A DDS adjudication team, consisting of a

disability examiner and a medical or psychological consultant, makes the

5

Included in the $61 billion of benefits are payments to all SSI blind and disabled beneficiaries

regardless of age.

6

DDSs are funded by SSA and make decisions in accordance with SSA’s policies and procedures.

Page 12 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 1 

Introduction

initial decision on each claim. If the DDS denies a claim, the claimant may

ask for reconsideration. For the reconsideration review, a new team of DDS

adjudicators makes an independent decision on the basis of its own

evaluation of all the evidence, including any new evidence the claimant

might submit.

If, after reconsideration, a DDS denies benefits, the claimant may pursue

several levels of appeal (see table 1.1) and may introduce new evidence at

almost every level. First, the claimant has the right to request a hearing

before an ALJ. Before the hearing, the ALJ may obtain further medical

evidence, for example, from the claimant’s own physician or by hiring a

consultative physician to examine the claimant. The hearing before the ALJ

is the first time that a claimant has an opportunity for a face-to-face

meeting with an adjudicator. SSA hearings are informal and nonadversarial;

SSA does not challenge a claimant’s case.

Table 1.1: Levels of Appeal and

Actions Taken by Disability

Adjudicators

Adjudicative action Adjudicative decisionmakers

State DDS

Make initial decision Medical consultant and disability examiner

team

Reconsider decision to deny benefits Different medical consultant and disability

examiner team

SSA

Review appealed DDS denial ALJ

Review ALJ denial Appeals Council members

Federal courts

Review final agency decision (by ALJ or

Appeals Council) to deny benefits

Federal courts

The claimant and witnesses—who may include medical or vocational

experts—testify at the hearing. The ALJ asks about the issues, receives

relevant documents into evidence, and allows the claimant or the

claimant’s representative to present arguments and examine witnesses. If

necessary, the ALJ may further update the evidence after the hearing. When

this is completed, the ALJ assesses the effects of the claimant’s medical

impairment on capacity to function at work. The ALJ then issues a decision

based on his or her assessment of the evidence in the case and is generally

authorized to do so without seeking input from a medical professional.

If an ALJ denies an appealed claim, the claimant may request that SSA’s

Appeals Council review the case. The Appeals Council may deny or

Page 13 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 1 

Introduction

dismiss the request, or it may grant the request and either remand the case

to the ALJ for further action or issue a new decision. The Appeals Council’s

decision, or the decision of the ALJ if the Appeals Council denies or

dismisses the request for review, becomes SSA’s final decision. After a

claimant has exhausted all SSA administrative remedies, the claimant has

further appeal rights within the federal court system, up to and including

the Supreme Court.

Overall, about 49 percent of all applicants receive benefits, most

(71 percent) from initial or reconsideration decisions made at the DDS

level. About 22 percent of all applicants appeal their cases to ALJs; about

two-thirds of all claimants whose claims are denied at the DDS

reconsideration level appeal to an ALJ. Overall, about 29 percent of all

claims in 1996 were awarded on appeal. Figure 1.1 shows an overview of

the disability decision-making appeals process.

Page 14 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 1 

Introduction

Figure 1.1: Disability Appeals Process and Outcomes

Source: GAO analysis based on 1996 SSA data.

Page 15 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 1 

Introduction

ALJ Procedures

Foster Independent

Decision-making

ALJs at SSA conduct de novo (or “afresh”) hearings; in other words, they

may consider or develop new evidence, and they are not bound by DDS

decisions. In addition, the Administrative Procedure Act (APA) protects

ALJs’ independence by exempting them from certain management controls.

Although ALJs are SSA employees and generally subject to the civil service

laws, the APA protects these staffs’ independence by restricting the extent

to which management controls them. For example, ALJ pay is determined

by the Office of Personnel Management independently of SSA

recommendations or ratings, and ALJs are not subject to statutory

performance appraisal requirements. Such safeguards help ensure that ALJ

judgments are independent and that ALJs would not be paid, promoted, or

discharged arbitrarily or for political reasons by an agency.

ALJs operate under rules that differ from those of appellate courts. After a

DDS denial is appealed, an ALJ at SSA holds a de novo hearing, entitling the

claimant to have all factual issues determined anew by the ALJ. In contrast,

appellate courts generally review the findings of lower courts and only

consider whether those courts made errors of law or procedure.

Under the ALJ de novo process, the claimant receives a full in-person

hearing from an adjudicator who is fully authorized to hear every aspect of

the case.7

 The ALJ hearing is the first time a new claimant is guaranteed the

right to testify before an adjudicator.

As SSA employees, ALJs make decisions for the Commissioner and are

subject to agency rules and regulations that they must apply in holding

hearings and making decisions. Review by the Appeals Council ensures

that ALJ decisions follow SSA regulations and rulings. If the Council

concludes that the ALJ has not followed agency rules and regulations, the

Council can reverse the ALJ decision on its own or send the case back to

the ALJ for further action.

Although the ALJ’s review and analysis of an appealed denial must include

the case file materials developed by the DDS, the ALJ makes new factual

determinations. For example, even though a DDS concludes that an

individual can perform work, the ALJ is free to conclude that the individual

cannot.

7

Not every appealed case involves a hearing; some are decided on the basis of the case record.

Page 16 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 1 

Introduction

Differences in

Decision Results Are

Long-standing

The differences between DDS and ALJ results are a long-standing problem

contributing to the growth in OHA backlogs and increased case-processing

time, according to our 1996 report on SSA’s efforts to reduce backlogs in

appealed decisions.8

 Our review of over 40 internal and external studies of

the disability determination and appeals process, several of which were

completed more than 20 years ago, led us to this conclusion. In the early

1990s, as part of its efforts to develop a number of strategic priority goals,

SSA reviewed many of the same studies and identified inconsistent

decisions as a critical issue affecting SSA’s ability to improve its service to

the public.

Inconsistent decisions have been evident in program data for many years.

For example, since 1986, DDS award rates have ranged from 31 to

43 percent, whereas ALJ award rates have ranged from 60 to 75 percent. As

shown in figure 1.2, ALJ awards, as a percentage of total awards, have

ranged from 17 percent in 1986 to 29 percent in 1996.9

8

Social Security Disability: Backlog Reduction Efforts Under Way; Significant Challenges Remain

(GAO/HEHS-96-87, July 11, 1996).

9

More recently, in the first quarter of fiscal year 1997, the proportion dropped to 24 percent.

Page 17 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 1 

Introduction

Figure 1.2: ALJ Awards as a

Proportion of All Awards, FYs 1986-96

Source: SSA data.

Concerns about comparatively high ALJ award rates are not new. Although

many hypotheses for inconsistent decisions have been discussed,

explanations for the high rate of ALJ awards have been inadequate or

unavailable. In early 1979, congressional hearings focused on high ALJ

award rates, and, in 1980, the Congress passed legislation aimed at

promoting greater consistency and accuracy of ALJ decision-making. This

legislation required SSA to establish a system of reviewing ALJ decisions to

ensure that they comply with laws, regulations, and SSA rulings. In

January 1982, SSA submitted to the Congress the results of a study on

progress made in reviewing ALJ decisions, including the possible causes for

ALJ reversals.10

Soon after SSA started to perform the quality reviews required by

legislation, the Association of ALJs filed suit in federal court. The lawsuit

challenged SSA’s plans to target these reviews to judges with high award

10Implementation of Section 304 (g) of Public Law 96-265, Social Security Disability Amendments of

1980 (the Bellmon Report), Secretary of Health and Human Services (Washington D.C.: Jan. 1982).

Page 18 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 1 

Introduction

rates on the grounds that such reviews threatened ALJs’ decision-making

independence. The court never ruled on this issue because SSA decided to

rescind targeted reviews. ALJ award rates fell temporarily from 62 percent

in 1981 to 55 percent in 1983 when SSA was performing its targeted

reviews, although other factors could explain the decline. When targeted

reviews ended in 1984, however, ALJ award rates started to increase again

and have remained at high levels ever since.

Decision-making

Process Yields Much

Inconsistency

Between DDSs and

ALJs

Not only do award rates between DDSs and ALJs differ, but the rates also

differ by impairment type and other factors. For example, although DDS

award rates vary by impairment, ALJ award rates are high regardless of the

type of impairment. As shown in table 1.2, DDS award rates ranged from

11 percent for back impairments to 54 percent for mental retardation. In

contrast, ALJ award rates averaged 77 percent for all impairment types with

a smaller variation among impairment types.

Table 1.2: Award Rates by DDSs and

ALJs by Impairment Type DDS award rates

(percent)

ALJ award rates

(percent)

Physical 29 74

Musculoskeletal 16 75

Back cases 11 75

Other musculoskeletal 23 76

Other physical 36 74

Mental 42 87

Illness 39 87

Retardation 54 84

All impairments 30 77

Source: GAO analysis based on SSA data from Sept. 1, 1992, through Apr. 30, 1995.

When age is considered in addition to impairment type, decisions can vary

even more widely. Table 1.3 illustrates, for example, how widely DDSs and

ALJs can diverge when age is considered in back impairment cases.

Page 19 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 1 

Introduction

Table 1.3: Back Impairment Award

Rates by DDS and ALJs by Claimant

Age

Award rates (percentage)

Age of claimant DDS ALJ

All ages 11 75

Under 50 2 68

50 and older 22 83

Source: GAO analysis based on SSA data for Sept. 1, 1992, through Apr. 30, 1995.

Recent SSA Efforts to

Reduce Inconsistency

SSA has long known about its inconsistent decisions and the problems they

pose for the disability programs and the agency. SSA has studied the

problem and taken several steps to address factors known to contribute to

inconsistency between DDS and ALJ adjudicators. In May 1992, SSA’s

Commissioner approved a study of the appeals process, later called the

Disability Hearings Quality Review Process (DHQRP).11 This study analyzed

the reasons for high ALJ award rates. SSA has issued two reports based on

this study, which is ongoing.12

Realizing that the inconsistency between DDS and ALJ decisions and the

length and complexity of the decision-making process compromised the

integrity of disability determinations, SSA began redesigning the process in

1993. In late 1994, it released its Plan for a New Disability Claim Process—

commonly referred to as the “redesign plan”—which represents the

agency’s long-term strategy for addressing the systemic problems

contributing to inefficiencies in its disability processes. To direct the

redesign effort, SSA created a management team assisted by top SSA

management, various task teams, and state and federal employees

involved with disability determinations.

To address inconsistent decisions as a part of redesign, the agency

established a process unification task team. This team included a diverse

group of 29 SSA and DDS employees who, in addition to their own expertise,

sought information from other sources and reviewed data from SSA’s DHQRP

study of the appeals process. In November 1995, the task team issued its

final report. SSA established an intercomponent group to develop specific

actions to support consistent disability decisions and a senior executive

11SSA’s decision to begin this review of ALJ decisions was prompted in part by our 1992 report about

racial disparities in ALJ allowance decisions. See Social Security: Racial Difference in Disability

Decisions Warrants Further Investigation (GAO/HRD-92-56, Apr. 21, 1992).

12Findings of the Disability Hearings Quality Review Process, SSA, Office of Program and Integrity

Reviews (Washington, D.C.: Sept. 1994 and Mar. 1995).

Page 20 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 1 

Introduction

group to enforce needed changes. In July 1996, the SSA Commissioner

approved the group’s recommendations for several initiatives designed to

reduce inconsistent decisions by DDSs and ALJs.

SSA Faces Several

Competing Workloads

In addition to SSA’s recent efforts to address inconsistent DDS and ALJ

decisions, the agency faces significantly increasing workloads at all levels

of adjudication. In particular, several congressional mandates will

compete for time and resources with process unification efforts. For

example, the Social Security Independence and Program Improvements

Act of 1994 and the Personal Responsibility and Work Opportunity

Reconciliation Act of 1996 require hundreds of thousands more continuing

disability reviews (CDR) to ensure that beneficiaries are still eligible for

benefits. By law, SSA must conduct CDRs for at least 100,000 more SSI

beneficiaries annually through fiscal year 1998. In 1996, the Congress

increased CDR requirements for children on SSI, requiring CDRs at least

every 3 years for children under age 18 who are likely to improve and for

all low birth weight babies in the first year of life. In addition, SSA is

required to redetermine, using criteria for adults, the eligibility of all

18-year-olds on SSI beginning on their 18th birthdays and to readjudicate

332,000 childhood disability cases by August 1997. Finally, thousands of

noncitizens and drug addicts and alcoholics could appeal their benefit

terminations, further increasing SSA’s workload.

SSA Includes Performance

Goals for Disability in Its

Government Performance

and Results Act Plan

The Government Performance and Results Act (the Results Act) of 1993

requires federal agencies to be more accountable for the results of their

efforts and their stewardship of taxpayer dollars. The Results Act shifts

the focus of federal agencies from traditional concerns, such as staffing

and activity levels, to results. Specifically, the act directs agencies to

consult with the Congress and obtain the views of other stakeholders and

to clearly define their missions. It also requires them to establish long-term

strategic goals as well as annual goals linked to the strategic goals.

Agencies must then measure their performance toward these goals and

report to the President and the Congress on their progress.13

The Results Act’s initial implementation involves about 70 pilot tests

during fiscal years 1994 through 1996 to provide agencies with experience

in meeting its requirements before governmentwide implementation in the

fall of 1997. As a pilot agency, SSA submitted its fiscal year 1996 annual

13For further details, see Executive Guide: Effectively Implementing the Government Performance and

Results Act (GAO/GGD-96-118, June 1996).

Page 21 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 1 

Introduction

performance plan to the Office of Management and Budget in May 1995.

Specifically, the plan includes the strategic goals of (1) rebuilding

confidence in Social Security, (2) providing world-class service, and

(3) creating a supportive environment for SSA employees. It also includes a

broad range of measures for disability and appeals-related performance

outputs and outcomes.

Objectives, Scope,

and Methodology

In 1995 testimony before the Subcommittee on Social Security, House

Committee on Ways and Means, we reported on the timeliness and

consistency of DDS and ALJ disability determinations.14 After our testimony,

the Chairman asked us to examine the differences between DDS and ALJ

decisions in more detail. Specifically, we agreed to (1) ascertain the

factors contributing to inconsistent decisions by DDSs and ALJs and

(2) identify SSA’s efforts to address inconsistent decisions. We reported our

preliminary findings in testimony earlier this year.15

To respond to the first objective, we divided the possible contributing

factors into three types: (1) factors related to differences in RFC

assessments made by DDSs and ALJs, (2) procedural factors that contribute

to differences in decisions, and (3) use of quality reviews to manage the

process.

In conducting our review, we examined existing studies, SSA’s regulations

and program operations memoranda, and court cases related to the

disability programs. We also obtained and analyzed program and statistical

data; see appendix I for details. In addition, we interviewed DDS and SSA

officials, including ALJs and OHA staff. We also attended SSA’s nationwide

process unification training.

We performed our review at SSA headquarters in Baltimore, Maryland; OHA

headquarters in Falls Church, Virginia; and at SSA and DDS offices in

Atlanta, Boston, and Denver. We conducted our review between October

1995 and June 1997 in accordance with generally accepted government

auditing standards except that we did not verify agency data.

14Social Security Disability: Management Action and Program Redesign Needed to Address

Long-Standing Problems (GAO/T-HEHS-95-233, Aug. 3, 1995).

15Social Security Disability: SSA Actions to Reduce Backlogs and Achieve More Consistent Decisions

Deserve High Priority (GAO/T-HEHS-97-118, Apr. 24, 1997).

Page 22 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 2 

Disability Decision-making: A Complex

Process Requiring Much Judgment

SSA requires that DDS and ALJ adjudicators follow a standard approach—

called the sequential evaluation process—for making disability

determinations. Although standard, the process requires adjudicators to

make several complex judgments. For example, if adjudicators cannot

allow the claim on the basis of medical evidence only, they must make

judgments on whether claimants can perform prior or other work

available in the national economy despite their disabling conditions. Such

determinations may involve not only residual functional capacity (RFC)

assessments, but consideration of these assessments along with the

claimant’s age, education, and skill levels.

To reduce the amount of judgment involved, SSA has developed medicalvocational rules. In general, the older, less educated, and less skilled the

claimant, the more likely these rules will direct the adjudicator to award

benefits. For claimants with functional and vocational profiles that do not

fit the rules, however, adjudicator decision-making is less prescribed. In

addition, before making any decision, adjudicators must decide how much

weight to give to various sources of evidence and evaluate the

reasonableness and consistency of any allegations the claimant makes

about pain or other symptoms.

DDSs and ALJs Use a

Standard Approach,

the Sequential

Evaluation Process

To determine whether applicants meet the Social Security Act’s definition

of disability, SSA regulations provide DDS and ALJ adjudicators with a

sequential evaluation process (see table 2.1). Although the process

provides a standard approach, determining disability requires a number of

complex judgments.

For people 18 or older, the act defines disability under the DI and SSI

programs as the inability to engage in substantial gainful activity by reason

of a severe physical or mental impairment that is medically determinable

and has lasted or is expected to last at least 1 year or result in death.16

Moreover, the impairment must be of such severity that a person not only

is unable to do past relevant work, but, considering age, education, and

work experience, is also unable to engage in any substantial work

available in the national economy.

16Regulations currently define substantial gainful activity as employment that produces countable

earnings of more than $500 a month for disabled people and $1,000 a month for blind people.

Page 23 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 2 

Disability Decision-making: A Complex

Process Requiring Much Judgment

Table 2.1: Five-Step Sequential

Evaluation Process for Determining

Disability

Action or decision taken if answer to

question is

Step

Questions asked in the sequential

process Yes No

1 Is the applicant engaging in

substantial gainful activity?a

Stop—applicant is

not disabled

Go to step 2

2 Does the applicant have an

impairment that has more than a

minimal effect on the applicant’s

ability to perform basic work tasks?b

Go to step 3 Stop—applicant is

not disabled

3 Does the applicant’s impairment

meet or equal the medical criteria for

an impairment in SSA’s Listing of

Impairments?b

Stop—applicant is

disabled

Go to step 4

4 Comparing the applicant’s RFC with

the physical and mental demands of

the applicant’s past work, can the

applicant perform his or her past

work?

Stop—applicant is

not disabled

Go to step 5

5 On the basis of the applicant’s RFC

and any limitations that may be

imposed by the applicant’s age,

education, and skill level, can the

applicant do work other than his or

her past work?b

Applicant is not

disabled

Applicant is

disabled

aUnder the sequential evaluation process, SSA’s field offices determine whether the applicant is

engaged in substantial gainful activity.

bIn addition, the criteria require that the impairment last 12 months or be expected to result in

death.

Applicants are denied benefits at step 1 if they are engaged in substantial

gainful activity. At step 2, adjudicators further screen applicants by

assessing whether they have a severe impairment, defined by the

regulations as an impairment that has more than a minimal effect on the

applicant’s ability to perform basic work tasks. For those whose

impairments have more than a minimal effect on ability to work,

adjudicators then begin determining whether the applicant’s impairments

are severe enough to qualify for disability benefits.

Does the Applicant Qualify

Under SSA’s Listing of

Impairments?

In step 3 of the sequential evaluation process, adjudicators compare the

applicant’s medical condition with medical criteria found in SSA’s Listing of

Impairments—referred to as “the medical listings”—which are published

in SSA’s regulations. The listings delineate over 150 categories of medical

conditions (physical and mental) that, according to SSA, are presumed to

Page 24 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 2 

Disability Decision-making: A Complex

Process Requiring Much Judgment

be severe enough to ordinarily prevent an individual from engaging in any

gainful activity. For example, corrected vision of 20/200 or less,

amputation of both hands, or an intelligence quotient of 59 or less would

ordinarily qualify an individual for benefits.

An applicant may automatically qualify for benefits if the adjudicator

concludes that the laboratory findings, medical signs, and symptoms of

one of the applicant’s impairments meet the specific criteria for medical

severity cited in the listings for that impairment and the applicant is not

engaging in substantial gainful activity. If an applicant’s medical condition

does not meet the listed criteria or if the impairment is not listed, then the

adjudicator must determine whether the applicant’s impairment is the

medical equivalent of one in the listings.

The medical severity criteria for listed mental impairments are generally

more subjective than those for physical impairments. For most mental

impairments in the listings, many of the severity criteria are defined by

functional limitations. Determining whether a mental impairment meets or

equals the listed criteria often requires subjective evaluations about

(1) restrictions of daily activities; (2) difficulties in maintaining social

functioning; (3) deficiencies in concentration, persistence, or pace that

result in failure to complete tasks in a timely manner; and (4) episodes of

deterioration in work settings that cause the individual to withdraw or

have exacerbated signs and symptoms. For example, adjudicators must

decide whether the impairment has any impact at all on activities of daily

living or on social functioning, and, if so, rate the impact as slight,

moderate, marked, or extreme.

By contrast, the listed criteria for physical impairments generally are more

objective, relating to medical diagnosis and prognosis, rather than the

assessment of functional limitations in the mental listings. Determining

whether the medical findings for a physical impairment meet or equal

these criteria is a matter of documentation and is often more a question of

medical fact than opinion. In some instances, however, the criteria for

physical impairments also require that adjudicators assess functional

limitations. For example, for applicants with human immunodeficiency

virus, adjudicators assess their symptoms or signs, such as fatigue, fever,

malaise, weight loss, pain, and night sweats as well as their subsequent

effect on activities of daily living and social functioning. For

musculoskeletal and other impairments, adjudicators assess the

importance of pain in causing functional loss when it is associated with

relevant abnormal signs and laboratory findings. Adjudicators must also

Page 25 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 2 

Disability Decision-making: A Complex

Process Requiring Much Judgment

carefully determine that the reported examination findings are consistent

with the applicant’s daily activities.

Can the Applicant Perform

Past Relevant Work?

When medical evidence does not show that an applicant’s condition meets

or equals the severity criteria in the listings, adjudicators must determine

whether the applicant can perform past work. To do this, adjudicators use

judgment when they assess an applicant’s RFC—that is, what an applicant

can still do, despite physical and mental limitations, in a regular full-time

work setting.

To assess RFC, adjudicators must consider all relevant medical and

nonmedical evidence, such as statements of lay witnesses about an

individual’s symptoms. In considering medical evidence, adjudicators must

evaluate medical source opinions and judge the weight to be given to each

opinion. Adjudicators also often evaluate issues involving pain or other

symptoms and judge whether the applicant’s impairment could reasonably

be expected to produce the applicant’s symptoms.

Assessing physical RFC requires adjudicators to judge individuals’ ability to

physically exert themselves in activities such as sitting, standing, walking,

lifting, carrying, pushing, and pulling. Adjudicators also assess the effect of

the individual’s physical impairment on manipulative or postural functions

such as reaching, handling, stooping, or crouching. Assessing mental RFC

requires adjudicators to judge the individual’s functional abilities such as

understanding, remembering, carrying out instructions, and responding

appropriately to supervision, coworkers, and work pressures.

After assessing an applicant’s RFC, the adjudicator compares it with the

demands of the applicant’s prior work. The adjudicator either concludes

that the applicant can perform his or her prior work and denies the claim

or proceeds to the last step (step 5) in the sequential evaluation process.

Can the Applicant Perform

Other Work in the National

Economy?

At step 5, adjudicators evaluate whether applicants unable to perform

their previous work can do other jobs that exist in significant numbers in

the national economy. If the adjudicator concludes that an applicant can

perform other work, the claim is denied. Again, adjudicators must apply

judgment to determine whether an applicant can perform other work in

the national economy, depending on whether the applicant’s limitations

are exertional or nonexertional.

Page 26 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 2 

Disability Decision-making: A Complex

Process Requiring Much Judgment

An applicant has exertional limitations when his or her impairment limits

the ability to perform the physical strength demands of work. For this

evaluation, SSA places a claimant into one of five categories of physical

exertion—sedentary, light, medium, heavy, and very heavy—with

sedentary work requiring the least physical exertion of the five levels (see

table 2.2).17 On the basis of an applicant’s RFC, adjudicators must judge

which of the five exertional categories is the most physically demanding

work the individual can perform. For an applicant whose maximum

physical ability matches one of the five exertional categories of work, SSA

provides medical-vocational rules that direct the adjudicator’s decision on

the basis of the claimant’s age, education, and skill levels of prior work

experience.

Table 2.2: Definition of Five Exertional

(Strength) Demand Categories Strength requirements Exertional demand

category Requirement for lifting Other strength demands

Sedentary Requires lifting no more than 10

pounds at a time and occasionally

lifting or carrying articles like docket

files, ledgers, and small tools

Involves sitting; walking and

standing may be required

occasionally

Light Requires lifting no more than 20

pounds at a time or carrying objects

weighing up to 10 pounds

Requires a good deal of

walking or standing or

involves sitting most of the

time with some pushing and

pulling of arm or leg controls

Medium Requires lifting no more than 50

pounds at a time with frequent lifting

or carrying of objects weighing up to

25 pounds

Requires unlimited sitting,

walking, and standing ability

Heavy Requires lifting no more than 100

pounds at a time with frequent lifting

or carrying of objects weighing up to

50 pounds

Requires unlimited sitting,

walking, and standing ability

Very heavy Requires lifting objects weighing

more than 100 pounds at a time with

frequent lifting or carrying of objects

weighing 50 pounds or more

Requires unlimited sitting,

walking, and standing ability

Table 2.3 shows how the medical-vocational rules direct decisions for

people aged 50 or older who are limited to sedentary work.

17The Department of Labor developed this classification system, which is in its Dictionary of

Occupational Titles.

Page 27 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 2 

Disability Decision-making: A Complex

Process Requiring Much Judgment

Table 2.3: Directed Decisions Under

Medical-Vocational Rules for

Applicants Aged 50 or Older Whose

Exertional Ability Is Limited to

Sedentary Work

Education Previous work experience Directed decision

Limited (grades 7-11 or less) Unskilled or none Disabled

Limited (grades 7-11 or less) Skilled or semiskilled—skills

not transferable

Disabled

Limited (grades 7-11) or less Skilled or semiskilled—skills

transferable

Not disabled

High school graduate or

more—does not provide for

direct entry into skilled work

Unskilled or none Disabled

High school graduate or

more—provides for direct

entry into skilled work

Unskilled or none Not disabled

High school graduate or

more—does not provide for

direct entry into skilled work

Skilled or semiskilled—skills

not transferable

Disabled

High school graduate or

more—does not provide for

direct entry into skilled work

Skilled or semiskilled—skills

transferable

Not disabled

High school graduate or

more—provides for direct

entry into skilled work

Skilled or semiskilled—skills

not transferable

Not disabled

In general, the older a person is, the more likely SSA’s medical-vocational

rules direct adjudicators to award benefits. For example, under the rules

for those whose maximum physical capacity limits them to performing

sedentary work, applicants aged 50 or older qualify for benefits under four

of the scenarios shown in table 2.3. Those aged 45 through 49, however,

qualify under only one scenario; applicants aged 18 through 44 qualify

under no scenario (see table 2.4).

Page 28 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 2 

Disability Decision-making: A Complex

Process Requiring Much Judgment

Table 2.4: Directed Decisions Under

Medical-Vocational Rules for

Applicants Under Age 50 Whose

Exertional Ability Is Limited to Full

Range of Sedentary Work

Directed decision

Education

Previous work

experience Aged 45-49 Aged 18-44

Illiterate or unable to communicate in

English

Unskilled or none Disabled Not disabled

Limited (grades 7-11 or less)—at least

literate and able to communicate in

English

Unskilled or none Not disabled Not disabled

Limited (grades 7-11 or less) Skilled or

semiskilled—skills

not transferable

Not disabled Not disabled

Limited (grades 7-11 or less) Skilled or

semiskilled—skills

transferable

Not disabled Not disabled

High school graduate or more Unskilled or none Does not

apply

Not disabled

High school graduate or more Skilled or

semiskilled—skills

not transferable

Not disabled Not disabled

High school graduate or more Skilled or

semiskilled—skills

transferable

Not disabled Not disabled

Although SSA’s medical-vocational rules reduce the degree of judgment

that adjudicators must use in many cases, SSA has no rules to direct

adjudicators’ decisions for other cases. These include cases in which

(1) the applicant’s maximum strength capability does not match any of the

five exertional levels or (2) the applicant’s primary limitations are

nonexertional (or unrelated to the physical strength demands required for

sitting, standing, walking, lifting, carrying, pushing, and pulling). In such

cases, the medical-vocational rules can provide a guide for evaluating an

applicant’s ability to do other work, but the regulations instruct

adjudicators to base their decisions on the principles in the appropriate

sections of the regulations, giving consideration to the medical-vocational

rules for specific case situations. For example, an applicant may be

restricted to unskilled sedentary jobs because of a severe cardiovascular

impairment. If a permanent injury of the right hand also limits the

applicant to only those sedentary jobs that do not require bilateral manual

dexterity, then the applicant’s work capacity is limited to less than the full

range of sedentary work. The ability to do less than the full range of

sedentary work is not one of the five exertional levels defined in SSA’s

regulations; therefore, no medical-vocational rules would direct the

adjudicator’s decision.

Page 29 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 2 

Disability Decision-making: A Complex

Process Requiring Much Judgment

On the basis of Department of Labor data, SSA estimates that

approximately 200 unskilled occupations exist, each representing many

jobs that can be performed by people whose limitations restrict them to

the full range of sedentary work. But, if an applicant is limited to less than

the full range of sedentary work, the adjudicator must determine the

extent to which the exertional and nonexertional limitations reduce the

occupational base of jobs, considering the applicant’s age, education, and

work experience, including any transferable skills or education providing

for direct entry into skilled work. The mere inability to perform all

sedentary unskilled jobs is not sufficient basis for a finding of disability.

The applicant still may be able to do a wide range of unskilled sedentary

work.

Adjudicators Must Weigh

Evidence and

Reasonableness of

Symptom Allegations

Before making any decision, an adjudicator must assess the amount of

weight to give to the various sources of evidence and evaluate the

reasonableness and consistency of any allegations from applicants about

pain or other symptoms.

To provide a basis for determining disability, the adjudicator must gather

existing medical evidence, which includes (1) opinions of physicians or

psychologists who have had an ongoing treatment relationship with the

applicant and (2) hospitals, clinics, and other medical sources that have

treated or evaluated the applicant but not on an ongoing basis. In addition,

adjudicators may develop new medical evidence obtained from consulting

sources. Medical evidence includes (1) medical history; (2) clinical

findings, such as the results of physical or mental status examinations;

(3) laboratory findings, such as blood pressure and X rays; (4) statement of

the diagnosis of the disease or injury based on its signs and symptoms; and

(5) treatment prescribed and prognosis. Medical evidence also includes

statements from treating physicians or other medical sources describing

work-related activities, such as sitting, standing, walking, and lifting, that

the applicant can still do despite his or her impairments. In the case of

mental impairments, statements should describe the applicant’s ability to

understand, carry out, and remember instructions and respond

appropriately to supervision, coworkers, and work pressures. In making a

decision, an adjudicator must assess how much weight to give to each

medical source’s statement of opinion. Table 2.5 describes the factors to

be considered in weighing opinions.

Page 30 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 2 

Disability Decision-making: A Complex

Process Requiring Much Judgment

Table 2.5: Factors Adjudicators

Consider in Weighing Medical

Opinions Factor

General effect of each factor on the weight given to a

medical source opinion

Examining relationship More weight is given to a source who examined the

applicant than to a source who did not.

Treatment relationship More weight is given to the applicant’s treating physicians

because they can provide a detailed, longitudinal picture

of the impairments and bring a unique perspective not

available from objective medical findings alone or from

single examinations or brief hospitalizations. If a treating

physician’s medical opinion is well supported and is not

inconsistent with other medical evidence in the case file,

then adjudicators must give it “controlling” weight.

Length, nature, and extent of

treatment relationship

Weight is commensurate with (1) the length of time a

source has treated the applicant, (2) the number of times

the source has seen the applicant, and (3) the source’s

knowledge based on the kinds and extent of

examinations and testing the source has performed or

ordered from specialists and independent laboratories.

Supportability Weight is commensurate with the extent to which the

medical source (1) supports the opinion with relevant

evidence, such as medical signs and laboratory findings,

and (2) provides an explanation for the opinion.

Consistency The more consistent an opinion is with the record as a

whole, the more weight adjudicators must give that

opinion.

Specialization All other factors being equal, more weight is given to the

opinion of a specialist on medical issues in his or her area

of specialty than to the opinion of a source who is not a

specialist.

Other factors Adjudicators must consider any factors that the applicant

or others bring to their attention that tend to support or

contradict the opinion.

Adjudicators also must evaluate whether an applicant’s impairment could

reasonably be expected to produce the reported symptoms—such as pain,

fatigue, shortness of breath, weakness, and nervousness. This requires the

adjudicator to assess the extent to which an individual’s symptoms are

consistent with (1) the objective medical evidence (medical signs and

laboratory findings); (2) evidence, such as statements from the applicant,

medical sources, family, friends, or employers about the applicant’s

medical history, diagnosis, prescribed treatment, activities of daily living,

and efforts to work; (3) information from social welfare agencies,

nonmedical sources, and other practitioners, such as chiropractors and

audiologists; and (4) any other evidence of the applicant’s impairment’s

effect on his or her ability to work.

Page 31 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 2 

Disability Decision-making: A Complex

Process Requiring Much Judgment

If the adjudicator concludes that the impairment could reasonably be

expected to produce the reported symptoms, the adjudicator must then

evaluate the intensity and persistence of the symptoms to determine how

the symptoms limit the applicant’s ability to work. In making such an

evaluation, adjudicators look for objective medical evidence obtained

through clinical and laboratory diagnostic techniques, such as evidence of

reduced joint motion, muscle spasm, sensory deficit, or motor disruption.

However, adjudicators cannot reject an applicant’s statements about the

intensity and persistence of pain or other symptoms or about the effect of

these symptoms on the ability to work solely because the available

objective medical evidence does not substantiate the applicant’s

statements. Because symptoms reported by the applicant sometimes

suggest a more severe impairment than can be shown by objective medical

evidence alone, adjudicators must carefully consider any other

information provided by the applicant, treating sources, or other people

about the applicant’s pain or other symptoms. Following are the factors

that adjudicators must consider in assessing pain and other symptoms:

• activities of daily living;

• location, direction, frequency, and intensity of the pain or other symptoms;

• precipitating and aggravating factors;

• type, dosage, effectiveness, and side effects of any medication the

applicant takes or has taken to alleviate pain/symptoms;

• treatment, other than medication, the applicant is receiving or has

received for relief of pain or other symptoms;

• any measures the applicant uses or has used to relieve pain or other

symptoms, such as lying flat on back, standing for 15 or 20 minutes every

hour, and sleeping on a board; and

• other factors concerning the applicant’s functional limitations and

restrictions due to pain or other symptoms.

Page 32 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 3 

DDSs and ALJs Differ Most When Assessing

Residual Functional Capacity

SSA studies show that DDS and ALJ decisions most often differ because

adjudicators make different conclusions about applicants’ ability to

function in the workplace. At the DDS and ALJ levels, two different types of

professional staff perform residual functional capacity (RFC) assessments.

At the DDS, medical staff perform the assessments; at the ALJ level, the ALJ

performs them. ALJs may seek the advice of medical experts, but they do

so infrequently. Study results also suggest that DDSs and ALJs differ in their

assessments of the opinions of applicants’ own physicians.

SSA has conducted studies of the differences between DDS and ALJ decisions

and has identified key issues. To improve consistency of decisions, the

agency has recently published policy clarifications, conducted training for

all disability adjudicators, and is now starting to evaluate the impact of

this training. SSA also plans to develop a single presentation of policy to be

used by both DDSs and ALJs.

Most ALJ Awards

Result From RFC

Assessments That

Differ From Those of

DDSs

Differing DDS and ALJ assessments of a claimant’s capacity to function in

the workplace are the primary reason for most ALJ awards. Under the

sequential evaluation process, almost all DDS denial decisions appealed to

ALJs include an RFC assessment. On appeal, ALJs also follow the same

sequential evaluation process and assess the claimant’s functional ability

in most awards they make. Both the ongoing Disability Hearings Quality

Review Process (DHQRP) study and a study conducted by SSA in 1982 note

the importance of differences in assessing RFC.

18 (See app. II for more

details on these studies’ results.)

Decisions in cases involving physical impairments clearly reflected

differences in assessing RFC. Table 3.1 presents data from SSA’s DHQRP study

on physical impairment cases in which ALJs made awards on the basis of

RFC assessments. The table compares the ALJ decisions with those of

reviewers who used the DDS approach and examined the written evidence

available to the ALJ. These data indicate that ALJs are significantly more

likely than DDS medical consultants to find that applicants have very

limited work capacity.

18Findings of the Disability Hearings Quality Review Process, SSA, Office of Program and Integrity

Reviews (Washington, D.C.: Sept. 1994) and Implementation of Section 304(g) of Public Law 96-265,

Social Security Disability Amendments of 1980 (the Bellmon Report), Secretary of Health and Human

Services (Washington, D.C.: Jan. 1982).

Page 33 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 3 

DDSs and ALJs Differ Most When Assessing

Residual Functional Capacity

Table 3.1: DDS and ALJ Differences in

RFC Assessment Classifications for

Physical Impairment Awards

Level of physical exertion determined by an

adjudicator or reviewer

Quality reviewers

using DDS

approach

(percentage of

awards)

Original awarding

ALJs (percentage

of awards)

Heavy work (or no limiting effect on physical

effort) 0 0

Medium work 22 1

Light work 56 8

Sedentary work 15 25

Less than the full range of sedentary work 6 66

Source: GAO analysis based on SSA data for ALJ awards made from Sept. 1992 through

Apr. 1995.

In the view of awarding ALJs, 66 percent of the cases merited a “less than

the full range of sedentary work” assessment—a classification that often

leads to an award. In contrast, the medical consultants who performed the

RFC assessment using the DDS approach found that less than 6 percent of

cases merited this classification. The DDS and ALJ adjudicators also differed

in the other classifications.

In addition, high ALJ award rates for claimants with mental impairments

often reflect different assessments of functional limitations. Even ALJ

mental impairment awards based on the listings reflect these differences

because most such listings require adjudicators to assess functional

limitations in addition to determining the claimant’s medical condition.

A study known as the Bellmon Report, which controlled for differences in

evidence, also found that differing RFCs played a role in differing DDS and

ALJ decisions. This study found that DDS and ALJ adjudicators reached

different results even when presented with the same evidence. As part of

the study, two groups of reviewers looked at selected cases. One group

reviewed the cases as ALJs would, and the other reviewed the cases as DDSs

would. Reviewers using the ALJ approach concluded that 48 percent of the

cases should have received awards; reviewers using the DDS approach

concluded that only 13 percent of those same cases should have received

awards.

Page 34 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 3 

DDSs and ALJs Differ Most When Assessing

Residual Functional Capacity

DDSs and ALJs Differ

in Their

Decision-making

Approaches

We identified specific differences in DDSs’ and ALJs’ approach to their

decisions. First, medical staff have different roles at the two levels. In

addition, DDSs and ALJs respond differently to (1) the opinions of claimants’

physicians and (2) claimants’ statements about symptoms such as pain.

DDSs and ALJs Use

Medical Expertise

Differently

Medical experts play different roles in the DDS and ALJ decision-making

approaches. At the DDS, medical or psychological consultants assess RFC of

applicants. In contrast, ALJs may consult with medical experts but have

sole authority to make the RFC finding. ALJs sought the advice of medical

experts in only 8 percent of cases resulting in awards, according to our

analysis.

Both the Bellmon and DHQRP studies compared RFC assessments made by

SSA medical staff using the DDS approach with those made by awarding

ALJs. According to both studies, medical staff tended to find that claimants

had higher capacities to function in the workplace than the ALJs found.

DDSs and ALJs Seem to

Differ in Their Reliance on

Treating Physicians’

Opinions

Under SSA regulations, adjudicators must consider the opinions of treating

physicians who have an ongoing treatment relationship with the claimant.

Such an opinion might include, for example, a statement that a claimant

“cannot stand or walk for more than two hours total in a day.” In the

disability determination, adjudicators must give controlling weight to

these treating source opinions provided they are (1) well supported by

medically acceptable clinical and laboratory diagnostic techniques and

(2) consistent with the other substantial evidence in the record. A treating

physician’s statement, however, that a claimant is “disabled” or “unable to

work” does not bind adjudicators.

Treating physicians’ opinions, however, seem to influence DDSs and ALJs

differently. The DHQRP study found that the treating physician’s report was

one of the five most frequent reasons for ALJ awards. This implies that ALJs

tended to give controlling weight to the treating physician’s opinion, while

DDS adjudicators were more likely to focus on assessing that opinion in

conjunction with other medical evidence in the case file.

Reports of Symptoms and

Claimants’ Credibility Also

Affect Differences, but

Extent Is Unknown

A second factor contributing to differing DDS and ALJ decisions is the

impact of symptoms (for example, pain, fatigue, or shortness of breath)

reported by the claimant but not identifiable in laboratory tests or

confirmable by medical observation. Like the opinions of the claimant’s

Page 35 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 3 

DDSs and ALJs Differ Most When Assessing

Residual Functional Capacity

own physician, assessment of symptoms is important in the disability

decision. Adjudicators must assess symptoms by determining (1) whether

the medically determinable impairments could reasonably be expected to

produce such symptoms and (2) the intensity, persistence, and

functionally limiting effects of the symptoms. According to SSA,

adjudicators must assess the claimant’s credibility on the basis of the

entire case record to make a determination about these symptoms’ effects.

DDSs generally make such assessments on the basis of the case file (for

example, statements made by applicants on the application or reports

from medical sources that record applicants’ comments). ALJs have

additional evidence because they have the opportunity to consider the

claimant’s testimony in a hearing. Moreover, claimant credibility has a

significant impact on ALJ decisions.

The DHQRP study identified the credibility of the claimant and claimants’

allegations about pain as two of the top five reasons for an ALJ allowance

decision. The impact of these reasons on DDS decisions is more difficult to

assess. However, during the DHQRP study, reviewers using the DDS

approach listened to tapes of claimant testimony in a small sample of 50

cases. The study concluded that claimant testimony had no or minimal

impact on those adjudicators.

Effect of Differences

in Policy Documents

Difficult to Assess

SSA adjudicators use two different sets of documents as criteria for

disability decisions, which some believe contributes to inconsistent

decisions. DDS adjudicators must follow a detailed set of policy guidelines,

called the Program Operations Manual System (POMS). The POMS for

disability contains detailed interpretations of laws, regulations, and rulings

as well as procedural instructions on deciding cases. ALJs, on the other

hand, rely directly on the laws, regulations, and Social Security Rulings

(SSR) for guidance in making disability decisions. The latter documents are

generally shorter and much less prescriptive than the POMS.

This difference in policy documents, along with the difference in decisions

between the DDSs and ALJs has led to the belief by some that there are two

standards—or at least two different interpretations of policy. A 1994

Inspector General survey of DDS and ALJ opinion found that the DDSs’ strict

application of POMS—as opposed to the ALJs’ direct application of disability

law and regulations—was considered to have a strong effect on allowance

rates by over half of those surveyed. Similarly, the Bellmon Report stated

that, “SSA has long recognized that the standards and procedures governing

decisions by DDSs and ALJs are not entirely consistent.”

Page 36 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 3 

DDSs and ALJs Differ Most When Assessing

Residual Functional Capacity

The type and extent of these differences have proven difficult to quantify,

however. For example, the Bellmon Report identified significant

differences in DDS and ALJ decisions based on impairments considered not

severe. The study then identified differences in the regulations and POMS

on this issue. The study concluded, however, that the two written

standards, “while different, (were) not widely divergent.” As such, it

remains unclear whether the differences derive from the standards or from

their differing application. Nevertheless, although their relative impact has

not been quantified, policy differences cannot be discounted as a potential

reason for inconsistent decisions.

SSA Is Taking Actions

to Improve

Consistency of

Decisions

SSA has taken or planned several initiatives to make disability decisions

more consistent. In July 1996, SSA issued nine SSRs to address several of the

factors we identified as contributing to inconsistent decisions. For

example, one of the new rulings reminds ALJs that they must obtain expert

medical opinion in certain types of cases.19 Another ruling clarifies when

adjudicators must give the opinion of a treating physician special

consideration. A third ruling states that an RFC of less than the full range of

sedentary work is expected to be relatively rare. SSA also plans to issue a

regulation to provide additional guidance on assessing RFC for both DDSs

and ALJs, specifically clarifying when a less-than-sedentary classification is

appropriate.20

In addition, partly on the basis of the nine rulings, SSA completed

nationwide process unification training between July 10, 1996, and

February 26, 1997. SSA officials pointed out that this training was the first

time that the agency had brought together DDS and ALJ staff to share their

views. The training represented a major effort—15,000 adjudicators and

quality reviewers received 2 full days of training, coordinated by

facilitators in SSA headquarters using a broadcast system. SSA has also

started to evaluate the impact of the new rulings and training by collecting

data before and after the new rulings and training.

Furthermore, SSA recently compared the policy language in the POMS with

disability law, regulations, and SSRs and concluded that no substantive

differences in policy existed. SSA did find some differences in wording and

19The ruling reinstates a previous SSA policy that an ALJ or Appeals Council member must obtain

expert medical opinion before determining that an impairment or group of impairments that do not

meet a specific listing are equivalent to the level of severity implied by the listings.

20In April 1997, SSA told us that the notice of proposed rulemaking on the less-than-sedentary

regulation is ready for release but did not provide a date when it would be issued.

Page 37 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 3 

DDSs and ALJs Differ Most When Assessing

Residual Functional Capacity

detail, however, that could lead to a perception of differences. To address

this matter, SSA plans to develop a single policy presentation to be used by

both DDSs and ALJs. To this end, the agency is using exactly the same words

in any new regulation, ruling, and POMS publication. It has already done

this, for example, for the SSRs on which the process unification training

was based. SSA eventually plans to have all adjudication policy in the form

of regulations or SSRs so that they are binding on ALJs as well as DDS

adjudicators.

In the longer term, SSA also plans under redesign to develop new, more

valid, and reliable functional assessment/evaluation instruments relevant

to today’s work environment. Because current differences in RFC

assessments are the main reason for inconsistent decisions, however, SSA

should proceed cautiously and test any new decision-making methods to

determine their effect on consistency as well as on award rates before

widespread implementation.

Page 38 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 4 

DDS Evaluations of Limited Use to ALJs

ALJs often cannot fully understand how DDS denial decisions have been

made because DDS written evaluations provide neither clear explanations

nor justifications for the findings and conclusions reached. Therefore, the

evaluations often do not lay a solid foundation for subsequent appeals. For

instance, the basis of the DDS’ residual functional capacity (RFC)

assessment is often unclear, leaving the ALJ without full understanding of

the reasoning that led to the DDS denial. Furthermore, explanations of how

the DDS considered evidence that ALJs might later rely on, such as the

opinions of the claimants’ own physicians, may often be missing from the

case file or are not fully developed. As a result, ALJs often cannot rely on

the evaluations as developed by the DDSs.

SSA has plans to change the process to improve the documentation of DDS

evaluations so they can better serve as a foundation for ALJ decisions.

These plans include requiring clear DDS explanations of the reasoning used

to support reconsideration denials and improving development of

evidence at the DDS. SSA also plans to return a selected number of cases

involving new evidence from the ALJ level to DDSs for their reconsideration.

Together, these changes in procedures will better serve as a foundation for

appeals, improving the consistency of DDS and ALJ decisions.

DDS Medical

Consultants Often

Inadequately Explain

RFC Assessments

As discussed in chapter 3, inconsistent decisions between DDSs and ALJs

are due mainly to differences in RFC assessments. Studies show that DDS

medical consultants often inadequately explain their conclusions,

including those about an applicant’s RFC. Such explanations, if improved,

could be more useful in ALJ decision-making. In fact, SSA’s policy is that an

ALJ, when making an RFC assessment, must consider the opinion of the DDS

medical consultant.

To this end, SSA requires DDS medical consultants to record explanations of

their reasoning. In particular, the agency asks medical consultants to fully

describe how they used the medical evidence to draw their conclusions

about an applicant’s RFC. RFC forms and procedures require that medical

consultants discuss in writing how the medical evidence in the case file

supports or refutes an applicant’s allegations of pain or other symptoms.

Finally, the RFC forms also require medical consultants to explain how

conflicts among treating physician opinion and other medical evidence in

the case file were resolved.

Disability Hearings Quality Review Process (DHQRP) data, however,

indicate that existing SSA procedures do not ensure that DDS decisions are

Page 39 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 4 

DDS Evaluations of Limited Use to ALJs

well documented. Specifically, procedures require the disability examiner

to prepare supplementary explanations when the resolution of key issues

is not well documented elsewhere in the case file. The DHQRP study of

appealed reconsideration denials found that in about half the cases that

hinged on complex issues—such as conflicts with the treating physician’s

opinion, assessment of RFC, and weighing of allegations regarding pain or

other symptoms—DDS documentation failed to explain how these issues

were resolved. The insufficient documentation of the underlying medical

analyses limited their usefulness during the appeal process.

ALJ Awards Are Often

Based on Information

Not Available to DDSs

Although ALJs use the medical evidence assembled by DDSs, they often base

their decisions on additional documentary or testimonial evidence. This

both contributes to inconsistent decisions and makes it difficult to

reconcile those differences. Procedures at the hearings level, such as

longer time frames for evidentiary development and permitting the

introduction of new information, result in the availability of new

documentary evidence for appeal cases. In addition, testimony during the

face-to-face hearing and the opportunity it provides for further assessing

the claimant’s credibility provide new information not in DDS case files.

Additional Medical

Evidence Results in ALJ

Awards

SSA studies show that in many instances introducing additional

documentary evidence at the hearing level results in an ALJ’s awarding

benefits. DHQRP data show that about three-quarters of the appealed cases

sampled contained new evidence. The study estimated that 27 percent of

the hearing awards hinged on additional evidence, resulting in an

assessment of a more severe impairment or a more restrictive RFC. In

addition, the Bellmon Report found that when new evidence was removed

from the case file, the ALJ award rate decreased from 46 to 31 percent. This

study also found that approximately three-quarters of new documentary

evidence was medical in nature rather than, for example, statements of

friends and associates.

One reason that appeals cases have additional evidence is that ALJ

procedures allow for more time to be spent on evidence development.

Although SSA regulations stipulate that “every reasonable effort” be made

to obtain necessary evidence, DDS guidelines state that evidence should

generally be gathered within 30 calendar days. ALJ guidelines, however,

provide a time frame for evidence gathering that is almost twice as long

and can be extended if necessary.

Page 40 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 4 

DDS Evaluations of Limited Use to ALJs

In addition, ALJs responding to an Inspector General (IG) survey believed

that DDSs often fail to adequately develop evidence to show the true nature

and extent of an applicant’s disability. The ALJs attributed some of this to a

lack of adequate resources at the DDSs and pressures to dispose of cases.21

Also, surveyed ALJs said that DDS problems with developing evidence,

particularly medical evidence, contribute to their reversals of DDS denials.

In an earlier survey we conducted of DDS administrators, almost two-thirds

responded that workload and staffing pressures had affected the accuracy

of denial decisions.22 Seven DDS administrators (14 percent) said the

harmful effect on the accuracy of denial decisions was great or very great.

Finally, the presence of attorneys or others who represent the claimant’s

interests may also result in the presentation of new evidence during an

appeal. Because attorneys are generally paid only when decisions favor

their clients, they are motivated to find and present additional evidence.

Although few claimants hire attorneys or other representatives at the DDS

level, DHQRP data showed that representatives attended 81 percent of ALJ

hearings.

Claimant Testimony

Appears to Result in ALJ

Awards

With few exceptions, ALJ hearings present a claimant’s first opportunity for

face-to-face contact with a disability adjudicator. Studies show that faceto-face encounters with claimants appear to account for a significant

number of ALJ reversals. Specifically, in the DHQRP study, reviewing ALJs

believed that a favorable assessment of the claimant’s credibility is a

factor in 34 percent of sampled hearing allowances. Although DDSs and

ALJs also assess credibility from case file information, testimony received

at a hearing appears to especially influence ALJs when assessing the

credibility of a claimant’s subjective allegations such as the effect of pain

on functioning.

The IG’s 1994 report showed that nearly 60 percent of ALJs surveyed

believed that the claimant’s appearance before an ALJ strongly affects

awards; 90 percent believed it has a moderate to strong effect.

Furthermore, the Bellmon Report found that the ALJ award rate decreased

by about 17 percentage points when evidence from the claimant’s record

of testimony was removed from the case file.

21The Disability Appeals Process: Administrative Law Judge Perspectives, Department of Health and

Human Services Office of the IG (Washington, D.C.: May 1994).

22Social Security: Increasing Number of Disability Claims and Deteriorating Service (GAO/HRD-94-11,

Nov. 10, 1993).

Page 41 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 4 

DDS Evaluations of Limited Use to ALJs

New Impairment Claims

Also Result in ALJ Awards

Because claimants may offer new documentary and testimonial evidence

at an ALJ hearing, they can also change their impairment type or add a new,

secondary impairment, which also affects consistency of DDS and ALJ

decisions. Moreover, in about 10 percent of cases appealed to the ALJ level,

claimants switch the basis of their primary impairment from a physical

claim to a mental claim. Under current procedures, the DDS lacks the

opportunity to routinely consider these switched claims, then incorporate

this consideration in their analysis, thus providing the ALJ with a basis for

confirming or rejecting the new impairment claim.

Effect of Other

Factors Does Not

Appear Major or Is

More Difficult to

Substantiate

In addition to inadequately explained RFC assessments and new evidence

submitted on appeal, we examined other factors that could affect

inconsistent decisions. We could not attribute any significant effect,

however, to other factors, such as worsening condition of claimants and

the lack of government representation at hearings.

Claimant’s Worsening

Condition Does Not

Appear to Be a Major

Contributor

Because claimants must often wait several months—on average almost a

year—for an ALJ hearing, it seems reasonable to conclude that some ALJ

awards could be explained by the claimants’ condition deteriorating

during that time. Worsening conditions, however, are not a major

contributor to ALJ awards, according to our examination of program data.

About 93 percent of ALJ awards had onset dates—dates on which the ALJ

had determined the individual had become disabled—that preceded the

DDS decision, suggesting that the ALJ had decided the individual had been

disabled when the DDS denied the case. If worsening conditions were a

major factor contributing to ALJs awarding benefits, we might expect to

see ALJ-determined onset dates coming after the date of the final DDS

denial. Because such onset dates are relatively rare, however, little basis

seems to exist for concluding that worsening conditions influence many

ALJ awards. Moreover, neither the Bellmon Report nor the DHQRP study

discussed worsening conditions as a key factor influencing ALJ awards.

An ALJ award based on a worsening condition may have also followed a

DDS denial based on the assumption that a claimant’s impairment would

improve within 12 months (individuals are not disabled if their impairment

is expected to last less than 1 year), SSA officials noted. If expected

improvement did not, in fact, occur, then the ALJ award would have

correctly been based on the original alleged date of onset. About

10 percent of ALJ awards are made to individuals whose claim the DDS had

Page 42 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 4 

DDS Evaluations of Limited Use to ALJs

denied on the basis of the duration requirement, according to our analysis

of program data. This 10 percent, however, represents a maximum amount

because available program data did not allow us to isolate the impact of

other factors—such as new information introduced at the ALJ level—which

could have been the main reason for the ALJ award.

Lack of Government

Representation at Hearings

Not Fully Evaluated

Although the ALJ is expected to consider SSA’s interests during the hearing,

the agency is not formally represented. The presence of a government

attorney or other advocate to represent SSA at hearings has been discussed

over the years as a way of improving the ALJ hearing process. Although

claimants have the right to representation, SSA relies on the ALJ to fully

document the case, considering the claimant’s as well as the government’s

best interests.

In the early 1980s, SSA initiated a pilot project at selected hearing offices to

test the effect of SSA representation at hearings. At a 1985 congressional

hearing, SSA released preliminary information from the pilot that suggested

that ALJ awards made in error could be cut by 50 percent if SSA were

represented at appeal hearings.23 Acting under a July 1986 court

injunction, however, SSA halted the pilot project. The court concluded that

the entire notion of SSA representation, as implemented, violated

procedural due process. In May 1987, SSA decided to end the project,

stating that the administrative resources committed to it could be better

used elsewhere. As a result, the preliminary results were never verified,

and a final report was never issued.

SSA’s Planned

Improvements in

Procedures

SSA plans to take several actions so that DDS and ALJ procedures better

ensure decision-making consistency, including requiring more detailed DDS

rationales, returning selected appealed cases to the DDS for consideration

of new evidence introduced at ALJ hearings, and using a “predecision

interview” by a disability examiner.

To improve explanations of DDS decisions, SSA plans to require more

detailed DDS rationales. New guidelines for all reconsideration denials are

to require DDS adjudicators to write rationales explaining how they made

their decisions, especially how the medical consultants assessed RFC,

treating physician opinion, pain, and other factors. On the basis of

feedback from the process unification training, SSA plans further

23Hearing before the Select Committee on Aging, House of Representatives, 99th Congress, 1st session,

Mar. 18, 1985.

Page 43 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 4 

DDS Evaluations of Limited Use to ALJs

instructions and training for the DDSs on the bases for their decisions and

where in the case files this information should go. SSA issued a ruling in

July 1996 clarifying that ALJs consider the findings of fact made by DDS

medical and psychological consultants as expert opinion evidence of

nonexamining sources and plans to issue a regulation to further clarify the

weight given by ALJs to the DDS medical consultants’ opinions.24

To ensure that DDSs have an opportunity to review all relevant evidence

before an ALJ hearing, SSA plans to return selected appealed cases to the

DDS for consideration of new documentary evidence introduced at ALJ

hearings. This would avoid the need for a more costly and time-consuming

ALJ decision in cases where the DDS would award benefits. If the DDS

cannot allow the returned claim, however, the DDS medical consultant

must provide a revised assessment of the case’s medical facts. SSA plans to

implement this project in May 1997, at which time it would begin selecting

about 100,000 of the roughly 500,000 appealed cases per year for such

claims.25 Moreover, SSA’s decision to limit such claims to about 100,000

cases may need to be reassessed in light of the possible benefits that could

accrue from this initiative.

SSA also plans to test the use of a “predecision interview” by a disability

examiner with the claimant before denying a claim. This interview would

provide an opportunity for the DDS to routinely obtain and consider

testimonial evidence. It would also allow the DDS the chance to better

ensure that claimants understand how decisions about their cases are

made and what evidence might be relevant. This could improve the

claimants’ ability to provide complete and relevant information and make

all relevant disability claims earlier in the disability determination process.

24In April 1997, SSA told us, the notice of proposed rulemaking on the DDS medical consultants’

opinions was in final clearance within SSA.

25DHQRP data show that 76 percent of appealed cases contain new evidence.

Page 44 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 5 

Quality Reviews Do Not Focus on

Inconsistency Between DDS and ALJ

Decisions

SSA could use its ongoing quality reviews to better focus on differences in

DDSs’ and ALJs’ assessments of functional capacity and of procedures to

improve its management of the decision-making process and reduce

inconsistent decisions between DDSs and ALJs. Current quality reviews,

however, focus on the DDS and ALJ decision-making processes in isolation

from one another and do not reconcile differences between them. In

addition, to better manage the process and reduce inconsistencies, SSA

also needs a quality review system that focuses on the overall process and

provides feedback to all adjudicators on factors that cause differences in

decisions. SSA has data and mechanisms in place that it could use to begin

integrating its quality reviews and to provide feedback to DDSs and ALJs. In

the longer term, SSA plans to systematically review decision-making at all

levels through a new quality review system.

Quality Reviews Not

Designed to Address

Differences

SSA has several quality review systems that review disability DDS and ALJ

decisions. As shown in table 4.1, each of the reviews has a different

purpose. None was developed to identify and remedy the factors that

contribute to differences in DDS and ALJ decisions.

Table 4.1: SSA Reviews Differ by

Organization Reviewed and Purpose Fiscal year 1996 cases

reviewed (approximate)

Type of review Purpose Award Denial

DDS level

Quality assurance Determine whether DDS

decisions comply with

written standards and

criteria, including

performance standards

27,000 33,000

Pre-effectuationa review (PER) Protect the solvency of the

DI trust fund by intercepting

DDS award errors before

payment

235,000 Not

applicable

ALJ level

Own-motiona Review ALJ award

decisions before payment

4,000b b

Appealed ALJ denials Ensure supportability of ALJ

denial before possible court

appeal by applicant

Not

applicable

57,000

aThe PERs cover DI and DI/SSI concurrent cases; own-motion reviews cover cases involving DI

only.

bExcludes reviews of “bureau protests,” which are generally cases with technical problems

related to insured status, but includes a small number of denials, which are being phased out.

Page 45 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 5 

Quality Reviews Do Not Focus on

Inconsistency Between DDS and ALJ

Decisions

At the DDS level, staff who report to SSA’s Office of Program and Integrity

Reviews (OPIR) perform a quality assurance review to promote the

accuracy and consistency of DDS determinations. The review uses

continuous random samples of completed award and denial actions. On

the basis of errors found during this review, SSA computes accuracy rates

for each DDS, which it compares with performance standards. DDSs that fall

below standards for two consecutive quarters are subject to increased SSA

oversight and may be removed from making disability decisions. In

addition, DDS staff also perform a pre-effectuation review or PER (that is, a

review before benefits payments are paid) of awards to protect the

solvency of the DI trust fund. Under this review, staff review 50 percent of

DI awards (not SSI-only cases) to prevent payment of erroneous awards.

At the ALJ level, quality review heavily focuses on the review of claims

denied by ALJs and appealed to SSA’s Appeals Council. Claimants whose

claims are denied by an ALJ and want to appeal the denial must apply to

the Appeals Council before bringing their claim to a federal court. The

purpose of this final agency review is to ensure that the case file fully

supports the ALJ denial decision before possible court appeal by the

claimant. On the basis of this review, the Appeals Council may, among

other things, reverse the denial decision or remand the case to the ALJ for

further action. In addition, like the PER at the DDS level, the Appeals

Council performs a PER of ALJ awards. Unlike the 50-percent sample used

for the PER, however, this Appeals Council review samples only a portion

of DI-only awards totaling about 3 percent of all ALJ DI awards to people

under age 59.

Review of Awards and

Denials Is Imbalanced, but

Effect on Decision Bias

Not Evident

As shown in table 4.1, DDS reviews emphasize awards; the ALJ reviews,

however, emphasize denials. This may inappropriately give DDSs an

incentive to deny claims and ALJs an incentive to award claims in both

instances to avoid scrutiny by quality reviewers. Available evidence,

however, does not support this conclusion.

Before SSA instituted the PER of DDS award determinations in fiscal year

1981, national accuracy rates were generally higher for initial denials than

for awards. After the PER was instituted, this situation reversed. By 1983,

award rates were more likely to be accurate than denial rates. This trend

may suggest that instituting the review caused a decline in the accuracy of

denials, while increasing the accuracy of awards. Other factors could have

influenced these accuracy trends, however, including workload pressures

and program changes. In addition, the difference between the denial and

Page 46 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 5 

Quality Reviews Do Not Focus on

Inconsistency Between DDS and ALJ

Decisions

award accuracy rates is slight. In fiscal year 1996, the denial accuracy rate

was only 2.9 percentage points lower than the award accuracy rate.

Moreover, data from the DHQRP study suggest that the evidence supports

ALJ awards and denials equally. As part of that study, reviewing ALJs

assessed 3,000 ALJ awards and 3,000 denials and found virtually the same

support rates for both types of cases: 81 percent of awards and 82 percent

of denials were supported by substantial evidence.

Current Quality

Reviews Mirror

Differences in

Approach and

Procedures

How DDS and ALJ quality reviews operate reflects the differences in how

decisions are made at the two levels. First, quality reviewers use the same

decision-making approach as those they are reviewing. Therefore, they

sustain the differences in approach discussed earlier rather than reconcile

them. For example, the Appeals Council, mirroring the approach of the

ALJs, infrequently consults with medical experts. Second, DDS reviews do

not examine the possible impact at the ALJ level of weaknesses in evidence

or the explanation of the decision. As a result, SSA misses the opportunity

to use quality reviews to strengthen procedures so that DDS decisions

better serve as a basis for ALJ consideration.

Differences in Approach

Not Identified and

Reconciled

The staff and approach used in SSA’s quality reviews of DDS decisions

mirror those used in the DDS process. SSA review teams, composed of

disability examiners and physician consultants, assess the quality of DDS

decisions using the same policies and procedures that DDSs use in making

their decisions. For example, when review staff examine a DDS decision, a

physician consultant on the team has final authority regarding the

correctness of the residual functional capacity (RFC) assessment made by

the DDS medical consultant.

Likewise, SSA’s Office of Hearings and Appeals (OHA) staff perform ALJ

reviews in a manner that mirrors the ALJ process. Staff at OHA screen

decisions for conformance with the same standards and procedures used

by ALJs, then refer cases that merit further review to the Appeals Council,

which consists of attorneys. Similar to ALJs, Appeals Council reviewers

have sole authority for assessing a claimant’s RFC, and they seek medical

input infrequently. The Appeals Council’s medical staff and contract

physicians consulted in about 17 percent of the cases reviewed by the

Appeals Council, according to our analysis of available SSA data.

Page 47 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 5 

Quality Reviews Do Not Focus on

Inconsistency Between DDS and ALJ

Decisions

In addition, although SSA’s Office of Disability is responsible for

promulgating a uniform decision-making policy, management control of

reviews is split between OPIR, which reports to the Deputy Commissioner

for Finance, Assessment, and Management, and the Appeals Council,

which reports through OHA to another Deputy Commissioner. The two

review groups have not routinely met to identify and resolve issues related

to inconsistent decisions.26

Quality Reviews Do Not

Ensure That DDS Decision

Builds a Solid Foundation

for ALJ Decision

SSA’s quality reviewers examine the evidence gathered by the DDS to

determine if the end result complies with SSA regulations and guidelines.

Although SSA’s reviewers assess the adequacy of the DDS’s explanation of

the initial decision, the reviewers consider the DDS to have made an

accurate decision whether it is well explained or not. If a DDS medical

consultant fails to adequately explain the basis for the RFC assessment—

but nonetheless the decision appears correct and based on adequate

evidence—the reviewers do not charge DDS with an error affecting its

performance accuracy.

This approach focuses on performance accuracy; it does not provide DDSs

with routine, systematic feedback on inadequate RFC explanations because

SSA does not return cases to DDSs for correction solely because RFC

explanations are inadequate. Instead, if reviewers return a case to a DDS

because of other types of errors, such as inadequate evidence to support

the decision, the returned case would include comments on inadequate

RFC explanations by DDS medical consultants, according to SSA officials.

Otherwise, the only way that reviewers might provide feedback on

inadequate RFC explanations is during periodic visits to DDSs.

Consequently, SSA lacks a routine, systematic mechanism for giving DDSs

timely information on the adequacy of their RFC explanations.

Likewise, Appeals Council reviews have not emphasized ALJs’

consideration of DDS medical consultants’ opinions. First, the Appeals

Council samples few ALJ awards for review. Such reviews could identify

differences between the DDS medical consultant’s opinion and the ALJ view.

Second, even if the Appeals Council might want to consider the views of

DDS medical consultants, the lack of explanation gives the Council little to

review.

In addition, SSA’s quality reviews of DDSs’ performance accuracy do not

focus on weaknesses in DDS evidence gathering from the standpoint of

26Recently, SSA has started such meetings under its process unification effort.

Page 48 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 5 

Quality Reviews Do Not Focus on

Inconsistency Between DDS and ALJ

Decisions

whether the evidence could later contribute to ALJ reversals. Instead,

reviewers of DDS decisions focus on whether the evidence in the file

supports the DDS’s own decision. They do not consider whether gaps in

evidence may become significant in a later appeal. For example, if the file

indicates that the claimant has a treating physician, but the treating

physician’s report is missing from the file, quality reviewers do not

automatically cite this as a performance accuracy error. Instead, they

determine whether the totality of evidence in the file supports the DDS’s

decision. If the decision is supported adequately—despite the missing

evidence—the reviewers do not charge the DDS with a performance

accuracy error, though this lack of evidence could become significant at

the ALJ level. Although the DDS decision may be technically accurate, it may

also be vulnerable to reversal on appeal, a factor that the current quality

assurance system does not consider in assessing the overall quality of DDS

decisions.

In keeping with procedures, DDS reviewers also determine whether the DDS

has made a reasonable effort to obtain the evidence. In assessing the

reasonableness of the effort, however, the DDS reviewers again do not

focus on the potential impact of the missing information if the case were

to be appealed. Such a focus would be necessary for both identifying and

reconciling differences in decisions.

SSA Has Plans to

Improve Quality

Reviews

SSA has taken or planned several actions to reduce decisional

inconsistency, including addressing factors that we identified as important

contributors to the inconsistency. First, the agency has started to

systematically gather information on this subject. In 1992, SSA established

the Disability Hearings and Quality Review Process (DHQRP), which

collects data on ALJ decisions and on the DDS reconsideration denial

decisions that preceded them. DHQRP provides a data-driven foundation to

identify inconsistency issues and focus on strategies for resolution.

According to quality reviewers, SSA has continued this process and

anticipates issuing more reports in the future.

In addition, SSA is completing work on a notice of proposed rulemaking,

with a target issue date of August 1997 for a final regulation to establish

the basis for reviewing ALJ awards, which would require ALJs to take

corrective action on remand orders from the Appeals Council before

benefits are paid. As envisioned, disability examiners and physician

consultants as well as reviewing judges will review ALJ awards. In

November 1996, SSA began an initial start-up period for this effort and after

Page 49 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 5 

Quality Reviews Do Not Focus on

Inconsistency Between DDS and ALJ

Decisions

the regulation is issued plans to target about 10,000 cases for review

during the first year.

Unlike existing quality reviews, the new process aims to identify and

reconcile factors that contribute to differences between DDS and ALJ

decisions. When the reviewers find ALJ awards they believe are

unsupported, they send these cases to the Appeals Council. If the Appeals

Council disagrees with the conclusions of the quality reviewers, the case is

referred to a panel of SSA disability adjudicators from various SSA units.

This review process can reveal significant policy issues because the panel

will receive cases in which the reviewing Appeals Council judge disagrees

with the reviewing examiner and medical consultant. On the basis of

issues identified, SSA could issue new or clarified policies or provide

adjudicators with additional training. In addition, SSA’s process unification

effort calls for returning certain cases to the DDS when new evidence is

provided at the hearing level.

In the longer term, SSA envisions instituting a new quality review system

that will systematically review decision-making at all levels. One focus of

the new system is making the right decision the first time. SSA estimates

this new system will help reduce the percentage of awards made by ALJs,

while increasing the percentage made by DDSs. Under SSA’s model, when

this redesign is fully implemented, the percentage of all awards made by

ALJs would decline from around 29 to 17 percent, and the percentage made

by DDSs would increase from 71 to 83 percent. The agency has not

explicitly established this as a goal, however.

Page 50 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 6 

Conclusions, Recommendations, Agency

Comments, and Our Evaluation

Conclusions Inconsistent decisions between DDSs and ALJs are a long-standing problem

for SSA management with implications for the fairness, integrity, and costs

of both the decision-making process and the program overall. The award

rate of appeals raises questions about the fairness of the process because

many claimants are awarded benefits only after a lengthy appeal.

Moreover, persistent inconsistencies between the two levels can

undermine confidence in the integrity of the decision-making process.

Furthermore, the later the case is finally decided in the appeals process,

the more expensive it is to adjudicate.

SSA can make more progress than it has in the past by unifying the

decision-making process at both the DDS and ALJ levels. Meanwhile,

reducing inconsistent decisions will be limited to some extent by factors

inherent in the program. Disability decisions are inherently complex and

require adjudicators to exercise judgment on a range of issues. As a result,

expectations about the level of agreement possible in such a program

should acknowledge this reality. Moreover, the process involves large

numbers of decisionmakers with more than 15,000 adjudicators, quality

reviewers, and others, including over 1,000 ALJs, making these complex

decisions nationwide.

SSA has developed process unification initiatives that, if implemented,

could significantly improve the consistency of decisions. Competing

workloads at all levels of adjudication, however, could jeopardize progress

in this important area. SSA should capitalize on the momentum it has

recently gained and give consistency of decisions the sustained attention it

requires as an essential part of redesign. For example, the agency has

ongoing data gathering and review mechanisms in place that could

produce real progress in this area. SSA has not established explicit

outcome-oriented goals or measures, however, to assess its progress in

achieving consistent decisions. We believe the strategic planning process

required under the Government Performance and Results Act can be a

useful vehicle to help focus management attention on the results SSA hopes

to achieve through process unification and to monitor its progress toward

reaching these results. In this context, SSA needs to establish performance

goals to measure its progress in shifting the proportion of cases awarded

from the ALJ to the DDS level. SSA could then monitor its progress and make

corrections if its actions do not achieve the desired results. Using

quantifiable performance goals to measure results would place a high

priority on this issue and bolster public confidence in SSA’s commitment to

achieve more consistency in DDS and ALJ decision-making.

Page 51 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 6 

Conclusions, Recommendations, Agency

Comments, and Our Evaluation

Under process unification, SSA plans to ensure that the DDS decisions are

better explained and thus more useful to ALJs. Workload pressures at the

DDSs, however, may make full and thoughtful explanations of their

decisions difficult. SSA will need to consider ways to reduce these

pressures if the agency’s plans are to be effective. At the ALJ level, SSA’s

plans to return cases to the DDSs are important, given the significance of

new evidence as a possible reason for awards. SSA’s decision to limit such

returns to about 20 percent of cases, however, could reduce the

effectiveness of this initiative.

In addition, SSA plans to improve its quality reviews but could move more

quickly to implement these plans. Historically, SSA has never had a unified

system of quality reviews, despite studies documenting inconsistent

decisions. Specifically, in 1982, the Bellmon Report identified problems in

the consistency of less-than-sedentary residual functional capacity (RFC)

assessments, and the Disability Hearings Quality Review Process (DHQRP)

reinforced this finding in 1994. However, SSA has not effectively used its

quality reviews to focus on this problem or taken action to resolve it.

Similarly, DHQRP identified problems with DDS rationales, but no systematic

feedback has been provided on this issue. The DHQRP results give SSA an

adequate foundation and an ongoing review mechanism to begin unifying

quality reviews between the DDSs and ALJs without further delay. SSA could,

for example, use the DHQRP findings on less-than-sedentary awards to

sharpen and focus current Appeals Council reviews. The agency could also

focus on the adequacy of DDS decision explanations in its unified quality

review program.

We are also concerned that, without adequate planning and evaluation,

some redesign initiatives could have unintended consequences. For

example, under redesign, SSA intends to develop new, more valid, and

reliable functional assessment/evaluation instruments that are relevant to

today’s work environment. The agency intends to rely heavily on these

instruments in decision-making. But, because differences in RFC

assessments are the main reason for ALJ awards, SSA should proceed

cautiously. As such, it should test any new decision methods to determine

their effects on consistency as well as on award rates before widespread

implementation.

Recommendations SSA is beginning to implement initiatives to reduce inconsistent decisions

between DDSs and ALJs, realizing that the lengthy and complicated

decision-making process and inconsistent decisions between adjudicative

Page 52 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 6 

Conclusions, Recommendations, Agency

Comments, and Our Evaluation

levels compromise the integrity of disability determinations. We support

these initiatives and recommend that SSA take immediate steps and be

accountable for ensuring that they are implemented as quickly as feasible.

For example, using available quality assurance systems, SSA should move

quickly ahead to improve feedback to adjudicators at all levels. In

addition, to better ensure that adjudicators review the same record, the

agency should increase the number of cases it plans to return to DDSs

when new evidence is submitted on appeal.

In addition, we recommend that, given the magnitude and seriousness of

the problem, the Commissioner should, under the Results Act, articulate

the process unification results that the agency hopes to achieve and

establish a performance goal by which it could measure and report its

progress in shifting the proportion of cases awarded from the ALJ to the

DDS level.

SSA’s Comments and

Our Evaluation

SSA officials generally agreed with the conclusions and recommendations

in this report and stated that the report would be useful to SSA in its efforts

to reduce inconsistent decisions between DDSs and ALJs. SSA agreed with

our recommendation that the agency take immediate steps and be

accountable for ensuring that its process unification initiatives are

implemented as quickly as feasible.

Regarding our other recommendation, SSA said that the goal of making a

greater proportion of awards at the DDS level and fewer on appeal was

laudable and would promote good customer service. But SSA disagreed

about taking steps to be accountable for attaining this goal. Agency

officials believed that the natural outcome of SSA’s process unification

initiatives would effect an increase in DDS awards and a decrease in ALJ

awards. Because process unification is the linchpin of the disability

determination process, however, not just disability redesign, we continue

to believe that SSA needs to establish a performance goal for achieving

process unification and that the Results Act is the appropriate mechanism

to do this.

SSA took exception to our remarks suggesting that its proposal for a new

decision methodology could exacerbate inconsistent decisions. We do not

agree. Under redesign, SSA plans to reduce medical determinations to a

relatively small number of claims, while expanding the functional

component of the decision-making process. Because it is unlikely that the

new decision methodology will eliminate all adjudicator judgment needed

Page 53 GAO/HEHS-97-102 SSA Accountability for Decisions
Chapter 6 

Conclusions, Recommendations, Agency

Comments, and Our Evaluation

in making functional determinations, we continue to believe that SSA

should proceed cautiously and test any new decision methods to

determine their effects on consistency as well as award rates. In its

comments, SSA stated that it is committed to using research results to

dictate which, if any, changes will be made in the decision methodology.

We support this commitment.

The full text of SSA’s comments and our response appear in appendix III. In

addition, SSA provided technical comments, which we incorporated in the

report as appropriate.

Page 54 GAO/HEHS-97-102 SSA Accountability for Decisions
Page 55 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix I 

DDS and ALJ Disability Decisions and

Operations

Table I.1: DDS Decisions—September 1992 Through April 1995

Impairment type

Number of

decisions

Percent

of total

Number

of awards

Award

rate

(percent)

Listing

awards

Functional

awards

Percent of

awards—

functional

Awards,

unknown

basis Denied

All impairments 4,592,595 100 1,396,717 30 850,633 541,135 39 4,949 3,195,878

Total physical 3,148,186 69 919,668 29 570,089 347,470 38 3,424 2,228,518

Musculoskeletal 1,083,437 24 168,958 16 26,277 142,146 84 535 914,479

Back 660,747 14 69,663 11 5,330 64,080 92 253 591,084

Under age 50 387,252 8 8,719 2 2,970 5,685 65 64 378,533

50 and above 272,486 6 60,823 22 2,352 58,282 96 189 211,663

Unknown age 1,009 0 121 12 8 113 93 0 888

Other

musculoskeletal 422,690 9 99,295 23 20,947 78,066 79 282 323,395

Other physical 2,064,749 45 750,710 36 543,812 205,324 27 1,524 1,314,039

Total mental 1,066,217 23 450,176 42 272,795 175,856 39 1,525 616,041

Illness 860,482 19 338,447 39 186,085 151,504 45 858 522,035

Retardation 205,735 4 111,729 54 86,710 24,352 22 667 94,006

Unknown

impairment 378,192 8 26,873 7 7,749 17,809 66 1,315 351,319

Source: GAO analysis of SSA administrative data.

Page 56 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix I 

DDS and ALJ Disability Decisions and

Operations

Table I.2: ALJ Decisions—September 1992 Through April 1995

Impairment type

Number of

decisions

Percent

of total

Number

of awards

Award

rate

(percent)

Listing

awards

Functional

awards

Percent of

awards—

functional

Awards,

unknown

basis Denied

All impairments 759,999 100 586,821 77 142,267 439,663 75 4,890 173,179

Total physical 589,955 78 439,404 74 57,793 377,986 86 3,625 150,551

Musculoskeletal 288,795 38 217,153 75 21,464 194,061 89 1,628 71,642

Back 202,752 27 151,758 75 13,949 136,919 90 890 50,994

Under age 50 111,544 15 76,105 68 8,534 66,989 88 582 35,439

50 and above 69,864 9 57,679 83 3,838 53,556 93 285 12,184

Unknown age 21,344 3 17,974 84 1,577 16,374 91 23 3,371

Other

musculoskeletal 86,043 11 65,395 76 7,515 57,142 87 738 20,647

Other physical 301,160 40 222,250 74 36,330 183,924 83 1,996 78,910

Total mental 169,353 22 146,899 87 84,467 61,402 42 1,030 22,454

Illness 137,566 18 120,191 87 63,876 55,482 46 833 17,375

Retardation 31,788 4 26,709 84 20,591 5,920 22 198 5,079

Unknown

impairment 691 0 518 75 7 276 53 235 173

Source: GAO analysis of Disability Hearings Quality Review Process study data.

Page 57 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix I 

DDS and ALJ Disability Decisions and

Operations

Table I.3: DDS and ALJ Operations, FY

1986 Through First Quarter, FY 1997

Fiscal year 1986 1987 1988

DDS

Applications received 2,248,432 2,107,221 1,594,833

Initial decisions 2,007,130 2,010,996 1,516,873

Awards 757,943 698,324 540,135

Denials 1,249,187 1,312,672 976,738

Initial award rate (percent) 38 35 36

Reconsideration receipts 533,776 594,698 457,402

Reconsideration appeal rate 43 45 47

Reconsideration decisions 501,631 589,810 438,251

Awards 82,914 83,846 60,600

Denials 418,718 505,964 377,651

Reconsideration award rate (percent) 17 14 14

ALJ

Appeals received 225,273 270,241 274,779

Appeal rate (percent) 54 53 73

Appeal decisions 170,661 216,916 238,815

Awards 104,371 130,832 150,744

Denials 66,290 86,084 88,071

ALJ award rate (percent) 61 60 63

Percent of all awards 11 14 20

Page 58 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix I 

DDS and ALJ Disability Decisions and

Operations

1989 1990 1991 1992 1993 1994 1995 1996

1997 first

quarter

1,589,652 1,737,533 2,014,194 2,392,644 2,564,163 2,609,498 2,488,878 2,438,498 516,483

1,489,534 1,589,311 1,802,896 2,258,980 2,513,709 2,551,210 2,551,953 2,298,801 542,368

547,397 621,223 759,120 981,504 974,868 860,578 787,455 707,204 182,159

942,137 968,088 1,043,776 1,277,476 1,538,841 1,690,632 1,764,498 1,591,597 360,209

37 39 42 43 39 34 31 31 34

472,551 525,689 546,294 627,892 769,948 823,641 864,415 798,668 194,958

50 54 52 49 50 49 49 50 54

442,218 484,499 502,561 603,681 746,241 793,689 858,999 766,775 185,269

67,636 80,988 86,998 102,829 106,787 100,173 112,094 100,107 30,151

374,582 403,511 415,563 500,852 639,454 693,516 746,905 666,668 155,118

15 17 17 17 14 13 13 13 16

281,478 297,326 312,892 372,073 488,173 515,148 557,350 497,933 128,690

75 74 75 74 76 74 75 75 83

251,991 248,237 266,818 302,660 319,789 354,173 444,350 485,737 100,241

167,786 177,571 197,758 226,959 238,094 265,776 324,611 323,266 65,424

84,205 70,666 69,060 75,701 81,695 88,397 119,739 162,471 34,818

67 72 74 75 74 75 73 67 65

21 20 19 17 18 22 27 29 24

Sources: DDS data from State Operations Reports; ALJ data from the Office of Hearings and

Appeals Key Workload Indicators.

Page 59 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix II 

SSA Studies Addressing Differences

Between DDS and ALJ Decision-making

Two major SSA studies have found that DDS and ALJ adjudicators

systematically reach different results, even when considering the same

evidence. In a report known as the Bellmon Report, SSA issued the results

of the first study in January 1982. The second study, known as the

Disability Hearings Quality Review Process (DHQRP), is an ongoing quality

review of ALJ decisions for which SSA periodically issues reports on review

results. The most recent DHQRP report was issued in June 1995.

The Bellmon Report The Bellmon Report’s major finding was that even when reviewing the

same evidence from the same cases, DDSs and ALJs often reach different

conclusions on whether claimants are disabled. SSA issued this 1982 report

to comply with a provision known as the Bellmon amendment in the

Social Security Disability Amendments of 1980 (P.L. 96-265). This

provision required SSA to conduct ongoing reviews of ALJ decisions to

ensure that the decisions conform to statute, regulations, and binding

policy. The requirement grew out of congressional concerns about (1) the

increasing number of DDS denials being appealed to the ALJ hearing level,

(2) the high percentage of DDS denials being reversed by ALJs, and (3) the

accuracy and consistency of ALJ decisions.

Initiated in October 1981, SSA’s study was designed to examine whether

two separate sets of reviewers—one using the DDS decision-making

approach and the other using the ALJ approach—would reach different

conclusions when considering the same evidence for the same case (see

table II.1). Under the study, each set of reviewers reached its own

conclusions on each case without knowledge of the decision by the

original ALJ or the other reviewers and without personal contact with the

claimants.

Page 60 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix II 

SSA Studies Addressing Differences

Between DDS and ALJ Decision-making

Table II.1: Design of SSA’s Bellmon

Study Two sets of

reviewers Review criteria

Decision(s)

reviewed

Quality reviewers’

responsibilities

SSA medical

consultants/ disability

examiner teams

SSA’s Program

Operations Manual

System (POMS)

Original ALJ

decision

Evaluate medical

evidence 

Assess adequacy of

evidence 

Determine

impairment severity

Assess residual

functional capacity

(RFC) 

Conclude whether

claimants are

disabled on the

basis of the same

evidence

Reviewers from SSA’s

Appeals Council

The act, regulations,

Social Security

Rulings (SSR), and

guidance

handbooks

Original ALJ

decision

Conclude whether

claimants are

disabled on the

basis of the same

evidence

As shown in table II.1, the first set of reviewers were teams of SSA medical

consultants and disability examiners who applied the standards and

procedures found in SSA’s POMS, which governs DDS decision-making.

According to SSA, POMS contains SSA’s official program policy and program

operations guidance, which is binding on DDSs and all SSA components

except ALJs and the Appeals Council. POMS is based on, and consistent

with, the Social Security Act, SSA’s regulations, and SSRs. POMS is also

consistent with circuit court case law. Thus, the conclusions of the SSA

medical consultant/disability examiner teams represented the correct

application of DDS standards.

The second set of reviewers were from SSA’s Appeals Council, which is

SSA’s final administrative review authority on all appealed disability

decisions. These reviewers applied the standards and procedures

governing ALJ decisions. These governing standards and procedures

consisted of the Social Security Act and SSA’s regulations and rulings,

along with guidance provided in various handbooks. Because they applied

these decision-making criteria, the reviewers’ conclusions from the

Appeals Council represented the correct application of the standards and

Page 61 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix II 

SSA Studies Addressing Differences

Between DDS and ALJ Decision-making

procedures that apply to ALJs. The review was conducted in three phases

addressing three different questions.

Phase I: Do the Standards,

Procedures, and Practices

of DDSs, ALJs, and the

Appeals Council Result in

Different Decisions for the

Same Cases?

To address this question, the medical consultant/disability examiner teams

reviewed a representative random sample of 3,600 recent ALJ decisions, of

which 64 percent had awarded benefits. The Appeals Council reviewers

then reviewed all cases in which the medical consultant/disability

examiner teams disagreed with the original ALJ decision, plus an additional

300 cases in which no disagreement existed, for a total of 2,183 cases. The

Appeals Council—using the ALJ decision-making approach—awarded

benefits in 48 percent of the cases; the medical consultant/disability

examiner teams—using the DDS approach—awarded benefits in only

13 percent of the cases. The report identified three possible causes for the

different results.

First, standards and procedures differed. The ALJ approach, unlike the DDS

approach, often resulted in a finding that the claimant’s RFC was “less than

the full range of sedentary work,” which is the most restrictive RFC

possible and usually results in benefits being awarded. The Appeals

Council reviewers concluded that claimants in 9 percent of the cases had

an RFC that restricted them to less than the full range of sedentary work,

while the original ALJs had found that 18 percent—twice as much as the

Appeals Council—had that RFC. In contrast, the medical consultant/

disability examiner teams concluded that none of the claimants had an RFC

that restricted them to less than the full range of sedentary work. ALJs and

the Appeals Council also awarded benefits more often than did medical

consultant/disability examiner teams because of severe pain combined

with significant impairments or nonsevere mental disorders combined

with significant physical impairments. The report also noted that ALJs

apparently gave considerable evidentiary weight to treating physician

conclusions that claimants are medically disabled.

Second, standards were inconsistently applied. Although reviewers from

the Appeals Council applied the same standards and procedures that ALJs

used in making decisions, the Appeals Council denied benefits in

37 percent of the cases in which the original ALJs had awarded benefits and

awarded benefits in 21 percent of the cases in which the original ALJs had

denied benefits. These inconsistencies were even more pronounced than

these percentage differences indicate because even in those cases in

which the Appeals Council agreed with the ALJs on whether benefits

should be awarded or denied, they disagreed on the basis for the decision.

Page 62 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix II 

SSA Studies Addressing Differences

Between DDS and ALJ Decision-making

For example, when the original ALJs based their decisions to award

benefits on SSA’s medical listings, the Appeals Council agreed with that

basis in only 41 percent of the cases; when the original ALJs based their

decisions to award benefits on vocational criteria, the Appeals Council

agreed with that basis in only 38 percent of the cases. Agreement on other

criteria for awarding benefits was significantly lower.

Third, other contributing factors included subjectivity, organizational

trends, and management emphases. The report noted historical trends in

DDS and ALJ rates of awarding benefits, SSA program and management focus

on certain aspects of the process, and the subjective judgment inherent in

determining whether an individual can engage in substantial gainful

activity. The report stated that one manifestation of the subjectivity in the

process may be different decisions produced by different organizational

levels.

Phase II: Do Claimants’

In-Person Appearances

Before ALJs Have an Effect

on ALJ Decisions?

This phase involved selecting a special subsample of 1,000 cases from the

3,600 cases used in the first phase. Written transcripts of the hearings were

prepared that retained the testimony of expert witnesses but excluded any

testimony by the claimant or observations about the claimant’s personal

appearance. A representative sample of 48 other ALJs then reviewed the

files.

The reversal rate of the original ALJs had been 63 percent, but the ALJs who

reviewed the sample of cases for this study reversed only 46 percent.

Because information on claimants’ in-person appearances was the only

information that had been removed from the file, the report concluded

that claimants’ in-person appearances do affect ALJ decisions. The study

also observed differences in the reversal rates for claimants with legal

representation (61 percent) and those without representation (48 percent).

Phase III: Does the

Submission of Additional

Evidence After the DDS

Reconsideration Decision

Affect ALJ Decisionmaking?

This phase used the same sample of 1,000 cases used in phase II. All

medical and vocational evidence added to the file after the DDS

reconsideration decision was removed from the files. Another group of 48

ALJs reviewed the files.

When the additional evidence submitted after the DDS decision was

removed from the files, the ALJ reviewers’ overall reversal rate of

46 percent in phase II declined to 31 percent in phase III. The difference

was solely attributed, on the basis of a statistical test, to additional

Page 63 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix II 

SSA Studies Addressing Differences

Between DDS and ALJ Decision-making

medical evidence that had been submitted in 74 percent of the cases.

Additional vocational evidence did not affect reversal rates. The medical

consultant/disability examiner teams also reviewed these cases with and

without the additional medical evidence. Their reversal rate was

15 percent when the additional evidence was present and 12 percent when

it was not.

DHQRP SSA’s DHQRP study found that differences between DDS and ALJ decisions

noted in the Bellmon Report continued into the 1990s. SSA instituted DHQRP

partly as a result of our 1992 report on disparities in the ALJ award rates

between black and other claimants.27 Although we did not conclude that

racial bias was the factor responsible for these disparities, we could not

rule it out, which raised questions in many sectors, including the Congress,

about the extent to which SSA has fulfilled its mandate to have a fair,

unbiased ALJ hearing process.

SSA responded that our report did not draw a meaningful conclusion about

the impartiality of hearing decisions. SSA stated that it could not

immediately address all of our specific findings, however, because it did

not maintain an ongoing quality review database of ALJ hearing decisions.

As a result, SSA implemented a series of initiatives to address questions we

raised. Among the initiatives was the creation of DHQRP.

The SSA Commissioner directed DHQRP to examine not only any racial

differences but also program issues through an ongoing quality review of

ALJ hearing decisions. Implemented in March 1993, DHQRP’s objectives are

to promote fair and accurate hearing decisions and to collect sufficient

data to permit analysis of other adjudicative issues. From DHQRP results,

SSA intends to identify areas of the ALJ decision-making process that may

require some fine tuning through continuing legal education or programspecific training for ALJs and other adjudicators. Thus far, SSA has issued

two reports—in October 1994 and June 1995—covering the results of

reviews conducted through March 25, 1994.

DHQRP is a three-tier review process involving (1) medical consultants from

SSA’s Office of Disability, Office of Medical Evaluation; (2) disability

examiners from SSA’s Division of Disability Hearings Quality; and (3) ALJs

from SSA’s Office of Hearings and Appeals (OHA) who serve as reviewing

judges (see table II.2).

27See Social Security: Racial Difference in Disability Decisions Warrants Further Investigation

(GAO/HRD-92-56, Apr. 21, 1992).

Page 64 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix II 

SSA Studies Addressing Differences

Between DDS and ALJ Decision-making

Table II.2: Three-Tier DHQRP

Quality reviewers at

each tier Review criteria

Decision(s)

reviewed

Quality reviewers’

responsibilities

SSA medical

consultants

SSA’s POMS DDS

reconsideration

denial

ALJ decision

Evaluate medical

evidence

Assess adequacy of

evidence

Determine

impairment severity

Assess RFC

SSA disability

examiners

SSA’s POMS DDS

reconsideration

denial

ALJ decision

Assess whether

reconsideration

denial is supported

Assess whether ALJ

decision is

supported

Peer reviewer ALJs

from OHA

The act, regulations,

SSRs, and

Hearings, Appeals,

and Law Litigation

Manual (HALLEX)

ALJ decision only Assess whether ALJ

decision is

supported by

substantial

evidence 

Assess whether ALJ

decision meets

review criteria

In the DHQRP study, similar to the Bellmon Report, SSA’s medical

consultants and disability examiners’ reviews represent the DDS approach

to decision-making. Their reviews are based solely on criteria found in

SSA’s POMS, which contains the SSA decision-making policies and

procedures for DDS decision-making.

The medical consultants evaluate the written evidence available to (1) the

DDS examining team issuing the reconsideration denial that preceded the

sampled hearing decision and (2) the original ALJ who rendered the

sampled hearing decision. For each review, the medical consultant

evaluates and assesses the adequacy of the file’s medical evidence,

determines the level of severity, and if necessary, assesses the claimant’s

RFC. The medical consultants do not listen to the audiotape of the

testimony offered at the hearing.

After completion of the medical review phase, SSA’s disability examiners

use the medical consultants’ assessments to review the DDS’s

Page 65 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix II 

SSA Studies Addressing Differences

Between DDS and ALJ Decision-making

reconsideration denial and the ALJ’s hearing decision. Using the medical

review findings and other evidence in the file, the disability examiner

assesses whether the reconsideration denial and the hearing decision are

supported adequately. Like the medical consultants, the disability

examiners do not listen to the audiotape of the testimony offered at the

hearing.

In the last phase of DHQRP, working ALJs serve as peer reviewers who

evaluate only the hearing decision as it was issued by the original ALJ.

These peer reviewer ALJs measure the degree to which the original ALJ’s

hearing decision conforms to the Social Security Act, SSA’s regulations and

rulings, and SSA’s HALLEX. In doing so, the peer reviewer ALJs apply the

substantial evidence criterion from HALLEX, which defines substantial

evidence as “that evidence which, although less than a preponderance, is

sufficient to convince a reasonable mind of the credibility of a position

taken on an issue when no evidence on the opposing side clearly compels

another finding or conclusion.”

The DHQRP results reported by SSA demonstrate how DDS and ALJ decisions

differ or reveal reasons why they differ even when adjudicators base their

decisions on the same documentary case file evidence.

First, although peer reviewer ALJs have concluded that about 81 percent of

the ALJ reversals were supported by substantial evidence, the SSA medical

consultant/disability examiner teams, who used the DDS decision-making

approach, have concluded that only 41 percent of the ALJ reversals were

supported adequately by written evidence in the case file. The medical

consultant/disability examiner teams have concluded that (1) the evidence

in the file actually supported an opposite decision in 48 percent of the ALJ

reversals and (2) another 11 percent had insufficient evidence to make any

decision.

Second, DHQRP has provided evidence that ALJs generally find claimants’

RFCs to be significantly more restricted than do DDS medical consultants

using POMS criteria. When peer reviewer ALJs have reviewed ALJ reversals,

they have concluded that 56 percent of the claimants had RFCs that limited

them to less than the full range of sedentary work, while the medical

consultants, who have reviewed the same written evidence as the peer

reviewer ALJs, have concluded that only 6 percent had such restricted RFCs.

Third, the peer reviewer ALJs have identified the top factors that influenced

the original ALJs to award benefits. The reviewing ALJs have identified these

Page 66 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix II 

SSA Studies Addressing Differences

Between DDS and ALJ Decision-making

factors as (1) a more restrictive RFC assessment, (2) symptoms other than

pain, (3) claimant credibility, (4) medical source statements, and (5) the

impact of pain.

Fourth, DHQRP has shown that DDS medical consultants, when assessing

RFC, sometimes have overstated the claimant’s capacity to function in the

workplace. In reviewing DDS reconsideration denial case files, the SSA

medical consultant/disability examiner teams have found that in

18 percent of the cases the medical evidence supported awarding benefits.

In many of those cases, SSA’s review teams using POMS criteria have arrived

at different RFC assessments than have the DDSs on the basis of the same

written evidence.

These findings are based on cases reviewed through March 25, 1994. As of

that date, the medical consultants and disability examiners had reviewed

9,600 ALJ decisions (5,500 that awarded benefits and 4,100 that denied

benefits). The peer reviewer ALJs had reviewed a subsample of 6,000 ALJ

decisions (3,000 that awarded benefits and 3,000 that denied benefits).

The sample for DHQRP is selected monthly from OHA’s case control system.

Although hearing allowances are reviewed after SSA starts sending benefit

payments, all cases selected for review are administratively final and are

not changed by the study results. Hearing denials selected for the study

either already have been reviewed by the Appeals Council, or their appeal

period has expired.

The sample design allows analyses and conclusions to be drawn at the

national and regional levels but not at the state or DDS level. In addition,

the DHQRP database does not identify the ALJs who issued the decisions

being reviewed.

Page 67 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix III 

Comments From the Social Security

Administration and Our Evaluation

Note: GAO comments

supplementing those in the

report text appear at the

end of this appendix.

Page 68 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix III 

Comments From the Social Security

Administration and Our Evaluation

Now on pp. 38, 52.

See comment 1.

Page 69 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix III 

Comments From the Social Security

Administration and Our Evaluation

Page 70 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix III 

Comments From the Social Security

Administration and Our Evaluation

See comment 2.

Now on p. 51.

Page 71 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix III 

Comments From the Social Security

Administration and Our Evaluation

Page 72 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix III 

Comments From the Social Security

Administration and Our Evaluation

The following are GAO’s comments on the Social Security Administration’s

letter dated July 8, 1997.

GAO Comments 1. We revised the report, where appropriate, to use the term “RFC”

assessment rather than “functional” assessment. In addition, we clarified

our discussion of SSA’s plans for a new decision methodology to

distinguish between (1) the development new instruments for clinical

assessments of function and (2) the expansion of functional

considerations in the administrative decision-making process envisioned

under disability redesign. We agree that more objective assessments of

function would ameliorate some differences in results if these assessments

provided better evidence for decision-making.

We continue to believe, however, that the new decision-making process

may exacerbate inconsistent decisions. Under disability redesign, SSA

plans to reduce medical determinations to a relatively small number of

claims, while expanding the functional component of the decision-making

process. Because it is unlikely that the new decision-making method will

eliminate all adjudicator judgment needed to make functional

determinations, we continue to believe that SSA should proceed cautiously

and test any new decision-making methods to determine their effects on

consistency as well as on award rates. In its comments, SSA stated that it is

committed to using research results to dictate which, if any, changes will

be made to the decision-making methods. We support this commitment.

2. We revised our recommendation to emphasize the importance of SSA’s

committing itself under the Results Act to foster consistency in results and

to monitor and report on its progress in shifting the proportion of cases

awarded from the ALJ to the DDS level. Such a shift is the measure of SSA’s

achieving its qualitative goal to “make the right decision the first time.” In

it comments, SSA stated that it wholeheartedly supports our conclusion

that it needs to take immediate steps to reduce inconsistent decisions and

considers process unification the linchpin of disability redesign. But the

agency has not taken steps to be accountable for the success of this effort.

Because process unification is the linchpin of the determination process,

not just disability redesign, we continue to believe that SSA needs to

establish a performance goal for this initiative and that the Results Act is

the appropriate mechanism to achieve the desired results.

SSA believes that it would not be legally defensible or advisable to set

quantitative goals for increasing DDS award percentages and decreasing the

Page 73 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix III 

Comments From the Social Security

Administration and Our Evaluation

award percentages for hearings. It stated that setting numerical goals

could be construed as dictating decisions to award or deny claims, while

each claim should stand on its own merits. We believe that if properly

designed and implemented, however, the use of a performance goal would

direct the agency’s overall management of the process and would not

dictate individual decisions.

Furthermore, the agency states that a wide variety of factors influences

claim outcomes, including worsening conditions, new evidence, and the

like. As the report discusses, however, virtually all factors influencing

differences in results—differences in approach, inadequate DDS written

evaluations, and problems in the focus of quality reviews—are under SSA’s

management control. Therefore, we believe it is advisable for SSA

management, consistent with the Results Act, to hold itself accountable

for continued progress toward process unification.

Page 74 GAO/HEHS-97-102 SSA Accountability for Decisions
Appendix IV 

GAO Contacts and Staff Acknowledgments

GAO Contacts Cynthia A. Bascetta, Assistant Director, (202) 512-7207

Staff

Acknowledgments

David F. Fiske

William E. Hutchinson

Ira B. Spears

Kenneth F. Daniell

Carolina M. Morgan

Ellen S. Habenicht

Carol Dawn Petersen

Mary Ellen Fleishman

John G. Smale, Jr.

(106507) Page 75 GAO/HEHS-97-102 SSA Accountability for Decisions
Ordering Information

The first copy of each GAO report and testimony is free.

Additional copies are $2 each. Orders should be sent to the

following address, accompanied by a check or money order

made out to the Superintendent of Documents, when

necessary. VISA and MasterCard credit cards are accepted, also.

Orders for 100 or more copies to be mailed to a single address

are discounted 25 percent.

Orders by mail:

U.S. General Accounting Office

P.O. Box 6015

Gaithersburg, MD 20884-6015

or visit:

Room 1100

700 4th St. NW (corner of 4th and G Sts. NW)

U.S. General Accounting Office

Washington, DC

Orders may also be placed by calling (202) 512-6000 

or by using fax number (301) 258-4066, or TDD (301) 413-0006.

Each day, GAO issues a list of newly available reports and

testimony. To receive facsimile copies of the daily list or any

list from the past 30 days, please call (202) 512-6000 using a

touchtone phone. A recorded menu will provide information on

how to obtain these lists.

For information on how to access GAO reports on the INTERNET,

send an e-mail message with "info" in the body to:

info@www.gao.gov

or visit GAO’s World Wide Web Home Page at:

http://www.gao.gov

PRINTED ON RECYCLED PAPER
United States

General Accounting Office

Washington, D.C. 20548-0001

Official Business

Penalty for Private Use $300

Address Correction Requested

Bulk Rate

Postage & Fees Paid

GAO

Permit No. G100