United States General Accounting Office

GAO Health, Education, and Human Services

Division

April 1997 Income Security

Issues

Issue Area Plan

for Fiscal Years

1997 and 1998

GAO/IAP-97-8

Foreword

As the investigative arm of the Congress and the nation’s auditor, the

General Accounting Office is charged with following the federal dollar

wherever it goes. Reflecting stringent standards of objectivity and

independence, GAO’s audits, evaluations, and investigations promote a

more efficient and cost-effective government; expose fraud, waste, abuse,

and mismanagement in federal programs; help the Congress target budget

reductions; assess financial and information management; and alert the

Congress to developing trends that may have significant fiscal or

budgetary consequences. In fulfilling its responsibilities, GAO performs

original research and uses hundreds of databases, or creates its own when

information is unavailable elsewhere. To ensure that GAO’s resources are

directed toward the most important issues facing the Congress, each of

GAO’s 32 issue areas develops a strategic plan that describes the

significance of the issues it addresses, its objectives, and the focus of its

work. Each issue area relies heavily on input from congressional

committees, agency officials, and subject-matter experts in developing its

strategic plan. Income Security Issues focus on programs and policies at

the Social Security Administration (SSA), all non-health programs and

policies at the Department of Health and Human Services (HHS), and

pension programs and policies at the Department of Labor (DOL).

Together, these programs account for nearly 40 percent of all federal

spending. Millions of Americans rely on income security programs for

financial support. However, concerns about the high costs and rising

caseloads of the nation’s two largest welfare programs—Aid to Families

With Dependent Children and Supplemental Security Income—led to

major legislative changes in these programs in 1996. Moreover, the nation’s

Social Security and disability programs face continued financial pressures

and are the subject of current public debate about their purpose and

structure. On the pages that follow, we outline Income Security’s most

significant planned work in the following pivotal areas:

• ensuring that public funds for income security programs are spent

efficiently and protected from fraud and abuse;

• improving SSA’s service to the public at reduced cost;

• evaluating the adequacy of Social Security, and public and private pension

systems for future retirees;

• redesigning the nation’s disability programs to ensure the validity of the

determination process and encourage work;

• monitoring implementation of the 1996 welfare legislation; and

• assessing government efforts to protect children’s welfare.

Page 1 GAO/IAP-97-8
Foreword

Because events may significantly affect even the best of plans and because

periodic measurement of success against any plan is essential, our

planning process allows for updating the plan and responding quickly to

emerging issues. If you have any questions or suggestions about this plan,

please call me, or Diana Eisenstat or Mark Nadel, Associate Directors, at

(202) 512-7215.

Jane L. Ross

Director

Income Security Issues

Page 2 GAO/IAP-97-8
Contents

Table I: Key Issues 4

Table II: Planned

Major Work

8

Table III: GAO

Contacts

10

Page 3 GAO/IAP-97-8
Table I: Key Issues

Issue Significance

Promoting efficiency, cost-effectiveness:

How adequate are efforts to ensure that

funds for income security programs are

efficiently spent?

Concerned about waste, abuse, and mismanagement in the Supplemental Security

Income (SSI) program, GAO designated SSI as a high-risk program area in 1997. GAO

has also identified weaknesses in SSA’s efforts to ensure the integrity of Social Security

programs. In addition, because of recent changes in the nation’s welfare system,

accountability for more than $16.4 billion in block grants under the Personal

Responsibility and Work Opportunity Reconciliation Act of 1996 will become an

increasingly important issue. The agencies involved also need to ensure that they identify

and pursue less expensive ways to provide services, such as through contracting out

and privatization.

Improving SSA service and operations:

How can SSA improve service to the public

with fewer resources?

SSA administers retirement, survivor, disability, and welfare programs that annually

provide over $367 billion in benefits to about 50 million recipients. The agency is

grappling with difficult policy and program challenges, and at the same time it needs to

meet customer expectations in the face of growing workloads and reduced resources.

SSA expects to redesign inefficient work processes and modernize its information

systems to increase productivity, knowing that its customer service will deteriorate to

unacceptable levels if it continues to conduct business as in the past. SSA will also need

to effectively manage its workforce and consider what service delivery structure will work

best in the future.

Ensuring adequate retirement benefits:

Can Social Security and pensions ensure

adequate retirement income as the

population ages?

The prospective retirement of the “baby boom” generation raises questions about the

ability of Social Security, federal, state, and local government employee pension plans,

and private pension systems to provide all promised retirement benefits. As baby

boomers retire and live longer, Social Security program expenditures are expected to

exceed tax income beginning in 2012. Experts project that the Social Security trust funds

will be depleted by 2029, leaving insufficient funds to pay all expected benefits. The

Advisory Council on Social Security has recently put forth three different proposals to

ensure long-term solvency. These proposals are likely to be hotly debated over the next

few years. In addition to questioning the adequacy of funding for Social Security benefits,

many are concerned with the effectiveness of some pension plan regulations and with

recent changes in plan characteristics.

Page 4 GAO/IAP-97-8
Table I: Key Issues

Objectives Focus of work

1. Identify waste, abuse, mismanagement, and internal

control problems in SSI and welfare programs.

2. Assess how well SSA controls its payments to

recipients.

3. Identify opportunities to manage welfare, disability,

Social Security, and child support programs more

effectively and at lower costs.

—Evaluate SSA efforts to ensure integrity of SSI program.

—Identify potential improvements to SSA’s overpayment collection

practices.

—Identify means to improve initial and continuing eligibility decisions.

—Examine SSA’s controls over payments to benefit recipients.

—Evaluate HHS’ implementation of its welfare reform responsibilities.

—Examine efficiency of alternative means of delivering welfare and other

social services.

—Identify effective child support enforcement practices.

1. Assess SSA’s efforts to improve agency performance.

2. Provide information to the Congress on SSA’s efforts

to reengineer its disability claims process.

3. Assess how effectively SSA balances serving the

public and managing its limited resources. 

4. Assess SSA’s systems modernization efforts.

—Assess steps SSA has taken to improve performance under the

Government Performance and Results Act.

—Evaluate SSA’s reengineering implementation efforts.

—Examine SSA’s efforts to identify customer needs and develop

cost-effective approaches to meeting its service delivery challenges.

—Monitor SSA’s efforts to modernize its information systems and

technology. 

1. Study proposed solutions to Social Security’s longterm funding problems.

2. Determine the effectiveness of 401(k) plans in

providing retirement income.

3. Assess the effectiveness of private pension

regulations.

—Examine options for addressing Social Security’s funding problems.

—Evaluate characteristics of 401(k) pension plans.

—Examine the effectiveness of selected pension regulations.

(continued)

Page 5 GAO/IAP-97-8
Table I: Key Issues

Issue Significance

Redesigning disability programs:

How can these programs best ensure the

validity of the determination process and

encourage work?

The Disability Insurance (DI) and SSI programs have faced significant increases in both

caseloads and expenditures. In 1995, almost 7.5 million individuals received these cash

benefits at a cost of $57 billion. SSA reports that fewer than 1 out of every 500

beneficiaries on the disability rolls ever returns to work. However, promising disability

management progress in the private sector and recent medical, technological, social,

and legal changes suggest that more people with disabilities can work. In addition, new

ways to assess the ability of applicants to function in the work place could improve the

validity of the determination process. Significant legislative and programmatic changes

would be necessary for SSA to assist beneficiaries to develop their return-to-work

potential.

Promoting responsibility and work:

What progress is being made in

implementing the 1996 welfare

legislation?

The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 ended the

entitlement to assistance under the Aid to Families With Dependent Children program

and replaced it with capped block grants to the states for temporary assistance for

needy families. The act gives states broad discretion over program design, but

conditions individual benefit receipt on participation in work or work-related activity and

imposes a 5-year lifetime limit on benefits. The act also sets out personal responsibility

goals, including enhancing child support enforcement, reducing out-of-wedlock births,

and strengthening families; and restricts children’s and immigrants’ eligibility for SSI

benefits. The implementation of these changes will need to be studied to determine their

effects on families, children, and welfare caseloads and to ensure that they meet

congressional intent.

Protecting children’s welfare:

How adequate are government efforts to

protect vulnerable children? 

Dramatic increases in child abuse and neglect, and the resulting increases in foster care

caseloads, have stressed the entire child welfare system to the breaking point. At the

same time, families increasingly enter the system with complex social problems that are

difficult to rectify, such as poverty, substance abuse, and domestic violence. All levels of

government will face challenges in the years ahead as they attempt jointly to increase

positive outcomes for abused and neglected children within greater budgetary

constraints and while overhauling welfare programs.

Page 6 GAO/IAP-97-8
Table I: Key Issues

Objectives Focus of work

1. Identify better ways to promote the productive

capacity of disabled beneficiaries.

2. Monitor SSA’s efforts to manage disability

caseloads.

—Examine alternative ways to meet the needs of children with disabilities.

—Study factors that help disabled beneficiaries work.

—Assess alternative ways to improve return-to-work outcomes.

—Assess SSA’s progress in conducting continuing disability reviews.

—Examine alternative means of making disability determinations.

—Monitor quality assurance changes under SSA’s redesign.

1. Report on implementation and early results of the

block grants for temporary assistance for needy families

in moving families from welfare to work and in reducing

welfare dependence.

2. Assess progress toward meeting other personal

responsibility goals of the act.

3. Evaluate effects of welfare reform on select SSI

populations.

—Monitor implementation of the new temporary assistance for needy

families block grant requirements, including state approaches and issues,

funding levels and allocations, and program outcomes.

—Evaluate the adequacy of state and county information management

systems and data for evaluation and program management.

—Evaluate child care needs of families under temporary assistance for

needy families block grants and the availability of child care for

low-income workers.

—Review implementation of child support changes.

—Monitor implementation of welfare reform changes on SSI program

beneficiaries.

1. Assess the impact on child welfare of the 1996

overhaul of the welfare system.

2. Examine innovative service delivery approaches to

child welfare services.

3. Examine options for caring for abused and neglected

children who have been removed from their homes.

—Identify the impact of recent reforms on foster care and other child

welfare programs’ funding and caseload size.

—Evaluate efforts to better manage children’s length of stay in foster care.

—Evaluate efforts to privatize foster care services.

—Examine the expanded role of kinship care.

—Examine the implications of foster care policies and practices for cases

involving parental drug abuse.

Page 7 GAO/IAP-97-8
Table II: Planned Major Work

Issue Planned major job starts

Promoting efficiency, cost-effectiveness •SSA’s management oversight of the SSI program

•Effectiveness of reducing SSI benefits when living arrangements change

•Effectiveness of SSA’s fraud referral process for the SSI program

•Preventing SSI overpayments

•SSA’s use of waivers, suspensions, and penalties for overpayments

•SSA’s acquisition of payment control and eligibility data 

•Extent of controls over Social Security pension offsets

•Adequacy of SSA’s quality assurance program for detecting and correcting errors

•Effectiveness of offsetting disability benefits for workers’ compensation

•Making the Social Security card tamper-resistant

•States’ compliance with requirements under the Temporary Assistance for Needy

Families block grant

•HHS’ implementation of its responsibilities under welfare reform

•Means-tested program benefits paid to nonqualified aliens

•Privatization of social services

Improving SSA service and operations •SSA’s efforts to improve agency performance and address major challenges

•SSA’s progress in reengineering its disability claims process

•Opportunities for privatizing SSA services and operations

•Accuracy of benefit amount calculations

•SSA’s efforts to modernize technology (will be done by Accounting and Information

Management Division)

Ensuring adequate retirement benefits •Examine options for Social Security financing reform

•Women and pensions: lessons for Social Security reform

•Examine the impacts of raising the Social Security retirement age

•Comparing rates of return on Social Security contributions with equity investments

•Experience with Social Security privatization in other countries

•Effect of 10-percent rule on 401(k) plan investments

•Mechanisms for protecting 401(k) plan participants when employers make investment

decisions

•Effects of investor education programs on employee investment behavior

•Exemption of state and local pension plans from nondiscrimination testing 

•Options to enhance pension portability

Redesigning disability programs •Alternatives for assisting disabled children on SSI

•Factors affecting beneficiaries’ decisions to work

•Financial and medical incentives to return to work 

•SSA’s strategy for, and progress in, conducting continuing disability reviews

•Status of conducting mandated continuing disability reviews for SSI recipients

•Progress in improving disability determination methodology 

•Differences in eligibility and benefits determination between SSI and other

means-tested programs, and in the treatment of adults and children on SSI 

•Assess SSA’s efforts to improve quality assurance under disability redesign

(continued)

Page 8 GAO/IAP-97-8
Table II: Planned Major Work

Issue Planned major job starts

Promoting responsibility and work •Effect of work participation standards and state strategies for moving welfare

recipients into employment

•State policies regarding eligibility of immigrants and effects of benefit cutoffs 

•Benefit terminations follow-up

•Assess state progress and federal assistance in developing information technology

needed to implement welfare programs (will be done by Accounting and Information

Management Division)

•Impact of state welfare policies on child care

•Implications of time-limited welfare for child support enforcement programs

•Effects of SSI changes on children, immigrants, drug addicts and alcoholics, and

prisoners

Protecting children’s welfare •Implications of welfare reform on funding for foster care and related services

•Extent and effectiveness of concurrent permanency planning for children entering the

foster care system

•Opportunities to improve the relationship between child welfare agencies and the

judicial system

•Extent, effect, and outcomes of privatization of foster care and other child welfare

services

•Expanded role of kinship care

•Effects of parental drug abuse on foster care caseloads and policies

Page 9 GAO/IAP-97-8
Table III: GAO Contacts

Director Jane L. Ross (202) 512-7215

Associate Directors Diana S. Eisenstat (202) 512-7215

Mark V. Nadel (202) 512-7215

Assistant Directors Cynthia Bascetta

David Bixler

Kay Brown

Gale Harris

Roland Miller

Frank Mulvey

Michael Packard

James Wright

Fred Yohey

Clarita Mrena (San Francisco Office)

Page 10 GAO/IAP-97-8
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