Social Security Disability Programs: Clearer Guidance Could Help SSA Apply the Medical Improvement Standard More Consistently
Published: 2006-10-03T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The Social Security Act requires that the Social Security Administration (SSA) find an improvement in a beneficiary's medical condition in order to remove him or her from either the Disability Insurance (DI) or Supplemental Security Income (SSI) programs. GAO was asked to (1) examine the proportion of beneficiaries who have improved medically and (2) determine if factors associated with the standard pose challenges for SSA when determining whether beneficiaries continue to be eligible for benefits. To answer these questions, GAO surveyed all 55 Disability Determination Services (DDS) directors, interviewed SSA officials, and reviewed pertinent SSA data.
section_title: What GAO Found
paragraphs: Each year, about 13,800 beneficiaries, or 1.4 percent of all the people who left the disability programs between fiscal years 1999 and 2005, did so because SSA found that they had improved medically. More beneficiaries leave because they convert to regular retirement benefits, die, or for other reasons--including having earnings above program limits. In addition, while continuing disability reviews (CDR) are SSA's most comprehensive tool for determining whether a recipient continues to have a disability, on average, 2.8 percent of beneficiaries were found to have improved medically and to be able to work following a CDR during this 7-year period. Several factors associated with the medical improvement standard (the standard) pose challenges for SSA when assessing whether beneficiaries continue to be eligible for benefits. First, limitations in SSA guidance may result in inconsistent application of the standard. For example, SSA does not clearly define the degree of improvement needed to meet the standard, and the DDS directors GAO surveyed reported that they use different thresholds to assess if medical improvement has occurred. Second, contrary to existing policy, disability examiners in a majority of the DDSs are incorrectly conducting CDRs with the presumption that a beneficiary has a disability rather than with a "neutral" perspective. Other challenges associated with the standard include inadequate documentation of evidence as well as the judgmental nature of medical improvement determinations. All these factors have implications for the consistency of CDR decisions. However, due to data limitations, GAO was unable to determine the extent to which these problems affect decisions to continue or discontinue benefits.

section_title: Letter
paragraphs: In fiscal year 2005, the Social Security Administration (SSA) paid about  $126 billion to approximately 12.8 million beneficiaries under the  Disability Insurance (DI) and Supplemental Security Income (SSI)  programs. These disability programs provide income support and in most  cases, access to medical care for people unable to work due to physical or  mental impairments, or both. In recent years, both programs have grown  and are poised to grow even faster as the baby boom generation enters its  disability-prone years. For example, SSA expects that by 2010 the number  of DI beneficiaries and their eligible family members will increase by more  than one-third over 2001 levels.
SSA is required to conduct periodic continuing disability reviews (CDR) to  ensure that only eligible people continue to receive benefits. These  reviews assess whether individuals are still eligible for benefits based on  their current medical condition and ability to work, among other criteria.  When SSA was conducting these reviews in the early 1980s, there were  concerns that some beneficiaries were being arbitrarily removed from the  programs. In response, Congress passed the Social Security Disability  Benefits Reform Act of 1984 (the act), which among other things  established a medical improvement standard (the standard). Under this  standard, unless certain exceptions apply, SSA must find improvement in a  beneficiary’s medical condition and that the individual is able to work in  order to discontinue benefits. If SSA determines that the standard has  been met in the course of conducting a CDR, the beneficiary may continue  to receive benefits until the individual receives another CDR (which  potentially could result in a discontinuation of benefits), dies, or  transitions into Social Security retirement benefits.
Since the standard has been implemented, some observers have suggested  that certain factors associated with the standard may lead SSA to continue  benefits for some individuals who might otherwise be able to work. Given  this observation and the continued growth in the DI and SSI programs, the  Senate Committee on Finance asked us to (1) examine the proportion of  beneficiaries who are removed from the disability programs because they  have improved medically and (2) determine if factors associated with the  standard pose challenges when determining whether beneficiaries  continue to be eligible for benefits.
To address these questions, we reviewed the act, regulations, and SSA  guidance and processes for evaluating whether beneficiaries continue to  be eligible for benefits. We examined SSA data on CDR outcomes for a 7- year period (fiscal years 1999 to 2005). We looked only at DI and SSI adult  beneficiaries. We verified the statistical data on CDR outcomes,  interviewed knowledgeable officials about the data, and determined that  the data were sufficiently reliable for the purposes of our review.  Furthermore, we conducted a national survey of all 55 Disability  Determination Services (DDS) directors and received 54 completed  responses to achieve a response rate of 98 percent. In addition, we  interviewed various SSA officials, disability experts, and disability  advocacy groups regarding the standard. We also conducted site visits in  three states (Massachusetts, Texas, and California). We selected these  states based on several criteria, including number of disability  beneficiaries, proportion of CDRs that result in a discontinuation of  benefits, and geographic dispersion, among other criteria. During these  visits, we conducted in-depth interviews with 80 selected SSA officials,  including DDS directors, CDR supervisors, disability examiners, and  medical specialists. We also interviewed regional office disability officials,  regional Office of Disability Adjudication and Review officials,  administrative law judges, and regional Office of Quality Performance  officials and examiners. Moreover, we reviewed selected CDR cases to  obtain examples of how the standard may impact decisions to continue or  discontinue benefits. In addition, we consulted with outside groups  including the Social Security Advisory Board and disability advocacy  groups. We conducted our work from October 2005 through June 2006 in  accordance with generally accepted government auditing standards.  Appendix I discusses our scope and methodology in more detail. The  survey and a tabulation of the results can be viewed at  http://www.gao.gov/cgi-bin/getrpt?rptno=GAO-07-4sp.
subsections: section_title: Background
paragraphs: The Social Security Administration (SSA) administers two programs under  the Social Security Act that provide benefits to people with disabilities: (1)  Disability Insurance (DI) and (2) Supplemental Security Income (SSI).  Established in 1956, DI is an insurance program that provides benefits to  workers who become unable to work because of a long-term disability.  Workers who have paid into the Social Security Trust Fund are insured  under this program. At the end of calendar year 2005, the DI program  served about 8.3 million workers with disabilities, their spouses, and  dependent children and paid out about $85 billion in cash benefits  throughout the year. Once found entitled, individuals continue to receive  benefits until they either die, return to work and earn more than allowed  by program rules, are found to have improved medically and are able to  work, or reach regular retirement age (when disability benefits convert to  retirement benefits).
SSI serves people with disabilities on the basis of need, regardless of  whether they have paid into the Social Security Trust Fund. Created in  1972, SSI is an income assistance program that provides cash benefits for  disabled, blind, or aged people who have low income and limited  resources. At the end of calendar year 2005, the SSI program served about  6.8 million people and paid about $36 billion in federal cash benefits  throughout the year. These cash benefits are paid from general tax  revenues. SSI benefits generally can be discontinued for the same reasons  as DI benefits, although SSI benefits also may be discontinued if a person  no longer meets SSI income and resource requirements. Unlike the DI  program, SSI benefits can continue even after the person reaches full  retirement age.
The Social Security Act’s definition of disability for adults is the same  under both programs. A person’s physical or mental impairment must (1)  have lasted or be expected to last at least 1 year or to result in death and  (2) prevent or be expected to prevent him or her from being able to engage  in substantial gainful activity (SGA) for that period of time. People are  generally considered to be engaged in SGA if they earn above a certain  dollar level. For 2006, SSA considers countable earnings above $860 a  month to be SGA for an individual who is not blind and $1,450 a month for  an individual who is blind.
subsections: section_title: History of the Medical Improvement Standard and the Current Continuing Disability Review Process
paragraphs: Prior to 1980, some studies indicated that many beneficiaries of the  disability programs no longer had a disability and could work. To ensure  that only eligible beneficiaries remained in the programs, Congress passed  a law requiring SSA to conduct continuing disability reviews (CDR)  beginning in January 1982. State Disability Determination Services (DDS)  examiners began conducting medical CDRs under the same criteria used  to evaluate initial disability claims. In 1981 and 1982, about 45 percent of  those individuals who received a CDR had their benefits discontinued.  There was no statutory requirement for SSA to show that a beneficiary had  improved medically in order to remove him or her from the programs.  Disability advocacy groups and others became concerned that some  beneficiaries were being inappropriately removed from the disability  programs, and by 1984 SSA placed a moratorium on all CDRs.
To address concerns that some beneficiaries were being inappropriately  removed from the programs, Congress enacted the Social Security  Disability Benefits Reform Act of 1984. The act included a provision  requiring SSA to find substantial evidence demonstrating medical  improvement before ceasing a recipient’s benefits (the medical  improvement standard). SSA resumed CDRs in January 1986 using this  standard, which is among the first steps of the CDR evaluation process.  The standard has the following two elements that need to be met    Is there improvement in a beneficiary’s medical condition? The  regulations implementing the act define improvement as any decrease  in the medical severity of the beneficiary’s impairment(s) since the last  time SSA reviewed his or her disability, based on changes in symptoms,  signs, or laboratory findings.
Is this improvement related to the ability to work? Improvement  related to the ability to work is evaluated two different ways,  depending on whether the comparison point decision (CPD) was based  on: (1) meeting or equaling a prior disability listing or (2) a residual  functional capacity (RFC) assessment.
Meeting or equaling the prior listing: In this case, a disability  examiner will determine if the beneficiary’s same impairment(s)  still meets or equals the prior listing. A disability examiner  compares the beneficiary’s condition with the list of impairments in  effect at the time he or she was first awarded disability benefits. If  the impairment(s) meets or equals the prior listing, then benefits are  continued. If not, then the examiner proceeds with the CDR  evaluation.
Residual functional capacity assessment: In this case, a disability  examiner compares the beneficiary’s previous functional capacity  to the current functional capacity for the same impairment. If  functional capacity for basic work activities has improved, then the  examiner finds that the medical improvement is related to the  ability to work and proceeds with the CDR evaluation.
The act allows SSA to discontinue benefits even when the beneficiary has  not improved medically if one of the specific “exceptions” to medical  improvement appliesthe person benefits from advances in medical or vocational therapy or  technology,  the person has undergone a vocational therapy program that could help  him or her work,    new or improved diagnostic techniques or evaluations reveal that the  impairment is less disabling than originally thought, or  the prior decision was in error.
In order to be removed from the disability programs for one of the  exceptions, disability examiners must also show that the individual has the  ability to engage in SGA.
SSA does not conduct CDRs on all beneficiaries each year. At the time  beneficiaries enter the DI or SSI programs, DDSs determine when they will  be due for CDRs based on their likely potential for medical improvement.  Based on SSA regulations, DDSs classify beneficiaries into one of three  medical improvement categories    medical improvement expected—CDR generally once every 6 to 18    medical improvement possible—CDR once every 3 years; or    medical improvement not expected—CDR once every 5 to 7 years.
SSA has also developed a method, called profiling, to determine the most  cost-effective method of conducting a CDR. SSA applies statistical  formulas that use data on beneficiary characteristics—such as age,  impairment type, length of time on disability programs, previous CDR  activity, and reported earnings—to predict the likelihood of medical  improvement and, therefore, of benefit discontinuation. SSA assigns a  “score” to beneficiaries indicating whether there is a high, medium, or low  likelihood of medical improvement. In general, beneficiaries with a high  score are referred for full medical CDRs. Beneficiaries with lower scores  are, at least initially, sent a questionnaire, known as a “mailer.” Full  medical CDRs involve an in-depth examination of a beneficiary’s medical  and possibly his or her vocational status. This may include a review of the  recipient’s case file, physical and psychological condition, and medical  evidence by a disability examiner and physician. Unlike full medical CDRs,  CDR mailers consist of a short list of questions asking beneficiaries to self- report information on their medical condition, treatments, and work  activities. Appendix II describes the medical CDR evaluation process in  detail.
SSA will find that disability has ended and discontinue benefits if it  determines that medical improvement related to the ability to work has  occurred or that one of the exceptions applies, and the person’s  impairments are not severe or the person can do past work or other work.  If SSA determines that medical improvement has not occurred and that  none of the exceptions apply, then benefits are continued (see fig. 1).
If SSA finds that the individual no longer has a disability and discontinues  benefits following a CDR, the individual has the right to appeal the CDR  decision, first to another reviewer for a reconsideration, second to an  administrative law judge, then to the Appeals Council, and finally to  federal courts. At the hearing before the administrative law judge (ALJ),  the ALJ reviews the file, including any additional evidence submitted after  the DDS determination and may hear testimony from the individual as well  as medical and vocational experts.
SSA’s Office of Quality Performance conducts quality reviews of disability  determination outcomes. To conduct these quality reviews, SSA selects a  random sample of cases each month from all final CDR decisions,  stratifying the selection of cases by state and outcome (cases where  benefits are continued and discontinued). Then, a quality examiner  reviews the case to ensure it adheres to SSA guidance, including a review  of the DDS decision, the documentation of that decision, and the evidence  contained in the case. During these reviews, physicians evaluate the  evidence to ensure that the decision adheres to the medical improvement  standard. In fiscal year 2005, SSA’s Office of Quality Performance reported  nationwide accuracy rates for cases where CDR benefits were continued  and discontinued of 95 percent and 93 percent respectively. The combined  accuracy rate for all CDRs was about 95 percent.
section_title: Few Beneficiaries Are Removed from the Disability Programs Because They Are Found to Have Improved Medically
paragraphs: We found that on average, about 1.4 percent of all individuals who left the  programs between fiscal years 1999 and 2005 were removed for medical  improvement. More beneficiaries leave the disability programs because  they either die or convert to social security retirement benefits. In  addition, while full medical CDRs are the agency’s most comprehensive  tool for determining whether a beneficiary continues to have a disability,  about 2.8 percent of those who receive these CDRs are found to no longer  have a disability under the medical improvement standard.
subsections: section_title: Few Beneficiaries Are Removed from the Programs Due to Medical Improvement
paragraphs: Between fiscal years 1999 and 2005, annually, an average of 13,800  people—or about 1.4 percent of all individuals who left the disability  programs—were removed because SSA found that they had improved  medically. More people leave the programs when they die, convert to full  retirement benefits, or leave for other reasons. For example, between  fiscal years 1999 and 2005, each year an average of about 311,000  recipients (about 32 percent of all recipients who were removed from the  disability programs) died, and about 209,000 (about 21 percent) converted  from DI benefits to retirement benefits. In addition, each year about  444,000 beneficiaries (about 45 percent) were removed from the disability  programs for other reasons. These include about 54,000 DI beneficiaries  who SSA determined had earnings in excess of SGA, about 11,000 DI  beneficiaries who either converted to old-age retirement benefits prior to  reaching the full retirement age or were found to be erroneously eligible  for benefits, and about 379,000 SSI beneficiaries who were removed from  the SSI program for all reasons other than death and medical improvement  (including earnings and resources above the limit allowed by program  guidelines) (see fig. 2).
During fiscal years 1999 to 2005, the proportion of all beneficiaries who  were removed from the programs in each of the above categories  remained fairly consistent. For example, during this period, the proportion  of individuals removed from the disability programs in a fiscal year for  medical improvement ranged from 1.0 percent to 1.7 percent; the  proportion of individuals who died ranged from 31.1 percent to 33.0  percent; and the proportion of individuals who converted from disability  benefits to retirement benefits ranged from 19.7 percent to 22.7 percent.
section_title: Few Beneficiaries Who Receive Full Medical Continuing Disability Reviews Are Removed from the Programs Each Year
paragraphs: SSA data show that few beneficiaries who receive medical CDRs are  removed from the disability programs. Full medical CDRs are the agency’s  primary tool to determine whether a beneficiary has improved medically.  Between fiscal years 1999 and 2005, the number of full medical CDRs  conducted ranged from a high of 608,000 in 2001 to a low of 333,000 in  2005 (see fig. 3). Between fiscal years 1999 and 2005, an average of about  26,000 individuals each year (about 5.3 percent) were removed from the  disability programs as a result of receiving a medical CDR. Some of the  officials we interviewed stated that the medical improvement standard  may artificially limit the percentage of recipients who are found to have  improved medically. However, we were unable to identify any empirical  data regarding the impact of the standard on the percentage of recipients  who have their benefits discontinued, or what a “proper” discontinuation  rate should be.
While the number of CDRs conducted between fiscal years 1999 and 2005  fluctuated, the percentage of beneficiaries removed from the programs  remained fairly constant. For example, in fiscal years 1999, 2002, and  2004, the percentage of recipients who were removed from the disability  programs as a result of receiving a CDR was 5.4 percent, 5.6 percent, and 5  percent respectively. In addition to medical improvement, SSA also  removes beneficiaries for failing to cooperate during a CDR. For example,  a beneficiary may fail to appear for scheduled meetings with disability  examiners or physicians and thus may have their benefits discontinued. Of  the individuals removed from the programs as a result of receiving a CDR  between fiscal years 1999 and 2005, an average of about 13,800 individuals  (or 2.8 percent of all CDRs conducted between fiscal years 1999 and 2005)  were removed annually because SSA determined that they had improved  medically, while an average of about 10,300 individuals (or about 2.1  percent) were removed each year for failure to cooperate.
section_title: Several Factors Challenge SSA’s Ability to Assess Whether Beneficiaries Continue to Be Eligible for Benefits
paragraphs: Our review suggests that several factors associated with the standard pose  challenges for SSA’s ability to assess whether beneficiaries continue to be  eligible for benefits. First, limitations in SSA guidance may result in  inconsistent application of the standard. For example, we found that SSA  does not clearly define the degree of improvement needed to meet the  standard, and the DDS directors we surveyed reported using different  thresholds to show medical improvement. As a result of this apparent  limitation in SSA guidance, disability examiners may incorrectly decide to  continue or discontinue benefits. In addition, while the act provides for  certain exceptions that could result in additional individuals having their  benefits discontinued following a CDR, most of the disability examiners  we spoke with told us that they were uncertain about when to apply the  exceptions. Second, we found that most DDSs are incorrectly conducting  CDRs with the presumption that a beneficiary has a disability. Finally,  other factors, such as inadequate documentation of evidence and the  judgmental nature of the decision process for assessing medical  improvement may make it more difficult to determine whether a  beneficiary remains eligible for benefits. However, due to data limitations,  we were unable to determine the extent to which these challenges impact  decisions to continue or discontinue benefits during a CDR.
subsections: section_title: Limitations in SSA Guidance for Applying the Medical Improvement Standard May Result in Inconsistent Disability Decisions
paragraphs: Our work shows that SSA does not clearly define the degree of  improvement needed for examiners to determine if a beneficiary has  improved medically. Many disability examiners and DDS officials told us  that they were unsure about the degree of improvement required to meet  the standard, and some said this confusion stems from unclear SSA  guidance. In particular, SSA guidance instructs examiners to disregard  “minor” changes in a beneficiary’s condition. However, this guidance  does not adequately describe what constitutes a minor change. When we  asked SSA officials to clarify their understanding of what constitutes a  minor change, they told us that only changes that would not affect a  beneficiary’s ability to work should be considered minor. However, this  explanation of minor changes is not included in the agency’s guidance. As  a result, some DDSs may be inconsistently defining what constitutes a  minor change. For example, five DDS directors told us that they define  minor changes to include those that may actually improve functioning or  allow the beneficiary to work. In doing so, our review suggests that some  DDSs may be inconsistently applying the standard as to what constitutes  medical improvement. However, DDS directors differed on the extent to  which the guidance to disregard minor changes impacts CDRs.  Of the 52  DDS directors who answered a question in our survey on “minor” changes,  21 reported that the practice of disregarding minor changes is not an  impediment to making a disability determination, while 31 reported that it  is an impediment.
Similarly, we found that SSA guidance may not provide DDS examiners  with sufficient detail to determine whether improvements in beneficiaries’  medical conditions are related to their ability to work. At this step of the  CDR process, examiners look for changes in a beneficiary’s ability to  perform basic work activities since the last review, such as lifting heavy  objects or standing or sitting for periods of time. The guidance instructs  examiners to ensure a “reasonable relationship” between the amount of  improvement and the increase in the ability to perform basic work  activities. However, the guidance does not require a specific amount of  increase in functioning. The DDS directors we surveyed reported that they  interpret this guidance differently. Specifically, 17 of 49 directors reported  that a large or very large increase in a recipient’s ability to do basic work  activities is required; 24 reported that a moderate increase is required; and  8 reported that a minor or any increase at all is required. Furthermore, two  DDS directors in our survey inaccurately noted that the standard requires  that a beneficiary’s improvement be great enough so that it actually  enables the individual to work. One of these directors commented that  because SSA guidance on this aspect of the standard is open to broad  interpretation, it is difficult to document improvement to the extent the  individual is able to work. As a result, some DDSs may be inconsistently  applying this aspect of the standard that could potentially impact  decisions to continue or discontinue benefits. However, we were unable to  determine how much of an impact clarification of this guidance would  have on CDR outcomes.
The disability advocates we spoke with differed in their views on the  clarity of SSA guidance on medical improvement. While some stated that it  is clear and adequate, others stated that the guidance on assessing medical  improvement in psychological impairments and determining if  improvement is related to the ability to work is confusing and unclear. One  advocate stated that current SSA policies contribute to some recipients  remaining in the disability programs despite their ability to work.
We also found that while the act provides for exceptions to medical  improvement that could result in additional individuals having their  benefits discontinued as a result of receiving a CDR, most of the disability  examiners whom we spoke with on our site visits told us that they were  uncertain about when to apply the exceptions. SSA policies allow for  various exceptions, including when the prior decision was in error or  when persons benefit from education or training programs that could help  the individuals work. However, we found that while the examiners and  ALJs routinely assess whether a beneficiary has improved medically, they  do not routinely assess whether or not each of the exceptions applies to  the case. Moreover, many of the DDS officials and examiners we  interviewed told us that the guidelines for using the error exception are  written in a way that precludes its use, except in the most extreme  situations.
SSA officials explained that the exceptions were written to intentionally  limit their use in order to prevent examiners from circumventing the  standard, and that their infrequent use is appropriate. In addition, SSA  explained that when it issued the final rules governing the medical  improvement standard, it intended the exceptions to be true  “exceptions”—not to be routinely applied (including the error exception).  The agency also noted that a broader application of the error exception  could lead to a substitution of judgment by an adjudicator for the original  finding of disability in instances where a person’s medical condition had  not substantially improved. Some disability advocates we spoke with also  noted that the narrow interpretation of the error exception is appropriate  because it prevents substitution of judgment and arbitrary  discontinuations.
section_title: A Majority of DDSs Incorrectly Apply SSA Guidelines Stating That CDRs Should Be Conducted Neutrally, without a Presumption of Disability
paragraphs: According to our survey, a majority of DDSs incorrectly presume that a  beneficiary continues to have a disability when conducting CDRs, which  may make it more difficult for examiners to determine if a beneficiary has  improved medically. This is contrary to the act as well as SSA regulations  and policy, which require that CDR decisions be made on a “neutral basis.”  SSA defines neutral basis as a review that neither presumes that a  beneficiary (1) is still disabled because he or she was previously found  disabled and (2) is no longer disabled because he or she was selected for a  CDR. Under a neutral review, it is assumed that beneficiaries had a  disability at the time of the prior decision, but it is not assumed they still  have a disability at the time of a CDR. However, in survey responses, 31  DDS directors responded that in practice, CDRs are conducted with the  presumption that a beneficiary continues to have a disability. When asked  to explain this response, directors cited various factors that likely  contribute to the presumption of disability during a CDR. Thirteen  directors commented that the individuals are already receiving disability  benefits, and as a result, the directors assume that the beneficiary  continues to have a disability. Some of these directors also noted that they  make this presumption because the beneficiary was found disabled when  initially awarded benefits, and examiners must show medical  improvement to remove them from the programs.
Since a majority of DDSs are conducting CDRs with a presumption that  beneficiaries have a disability, those DDSs may be setting a higher bar  than required by the standard for these reviews. Moreover, by requiring  more evidence of medical improvement than is necessary under the  standard, it may be harder to assess whether a recipient no longer has a  disability and is able to work. Because 31 directors reported that  examiners conduct CDRs with the presumption that beneficiaries continue  to have a disability, a significant number of beneficiaries may be evaluated  under this higher standard, and some may have their benefits erroneously  continued. While these problems raise concerns about the consistency of  decisions when determining if medical improvement has occurred, the  ultimate impact of presuming that an individual has a disability on CDR  decisions is unknown because we were unable to empirically test how the  presumption of a disability impacts CDR decisions to continue or  discontinue benefits.
section_title: Other Factors May Make Assessing Medical Improvement Difficult
paragraphs: Inadequate documentation of evidence and the judgmental nature of the  process for assessing medical improvement are two additional factors that  make it challenging to assess medical improvement. The standard  establishes the prior decision as the starting point for conducting a CDR  and requires examiners to find evidence of medical improvement since  this last decision. Some DDS directors reported that it may be difficult to  assess medical improvement in cases where the prior disability decision  was based on incomplete or poorly documented evidence. For example, in  one of the CDR cases we reviewed, a beneficiary had his benefits  continued following the CDR because the rationale for the prior disability  decision was vague, according to the examiner who reviewed the case  with us. This beneficiary was originally awarded benefits on appeal based  on recurrent stomach problems and depression. When the case was  selected for a CDR, the case file included a general description of the  beneficiary’s medical condition, but lacked sufficient evidence to  determine if medical improvement had occurred since the initial decision,  according to the examiner. As a result, medical improvement could not be  shown and benefits were continued. While many examiners and officials  we interviewed agreed that it is difficult to show medical improvement in  cases that lack adequate documentation, they differed in their opinions  about how frequently this occurs. Of the directors who answered our  survey question on insufficient documentation, 33 responded that they  encounter cases with insufficient documentation infrequently or very  infrequently, and 17 responded that such cases occurred more often.
Survey respondents also differed in their opinions about the types of cases  that more typically lack adequate documentation, but 15 directors  commented that cases decided on appeal were the most likely to lack  adequate documentation. One possible explanation for this may be  streamlined processes at the appeals level. For example, one ALJ we  interviewed noted that, in an effort to process cases in a timely manner,  ALJs sometimes issue quick decisions in which most of the evidence is on  tapes that are not transcribed or placed in the beneficiary’s case file. In  such instances, it is unlikely that the DDS examiner would have complete  information for conducting a CDR and determining if medical  improvement had taken place. Furthermore, several officials told us that  guidance instructs ALJs to include enough information in their decisions  so that the decisions will be legally sufficient. However, the guidance does  not specifically instruct ALJs to include all of the evidence that will be  needed to assess medical improvement at a future CDR. However, in  recent regulations to implement changes to its disability determination  process, SSA is taking steps that may help to address the problem of  incomplete documentation for future CDRs. Specifically, SSA is  developing requirements for training examiners to ensure they understand  the information needed to make accurate and adequately documented  decisions, has adopted guides for decision writing at the appeals level, and  is in the process of developing guides for use at the DDS level.
In addition to the challenges associated with problems of inadequate  documentation, many examiners also told us that the judgmental nature of  the decision process concerning what constitutes an improvement can  make it difficult to assess medical improvement. One examiner may  determine that a beneficiary has improved medically and discontinue  benefits, while another examiner may determine that medical  improvement has not been shown and will continue the individual’s  benefits. For example, in one of the CDR cases that we reviewed, the  examiner conducting the initial CDR determined that medical  improvement was shown and discontinued the individual’s benefits. The  recipient was initially awarded disability benefits for a back injury with  limited range of motion in the recipient’s back. When the CDR was  conducted, the examiner evaluated all of the relevant evidence and  concluded that the individual’s range of motion had improved. The  examiner also noted that the individual’s allegations of pain did not  correlate with the findings from both the physical exam and the laboratory  findings. As a result, the examiner concluded that medical improvement  had occurred. On appeal to reconsideration 6 months later, a different  DDS examiner conducted a review using the same medical evidence as the  original examiner, but determined that medical improvement had not  occurred, and continued benefits. The examiner conducting the appeal  concluded that the beneficiary continued to experience pain consistent  with the back condition, and thus medical improvement was not shown.  However, we had no basis for determining which decision was correct.
The amount of judgment involved in the decision-making process  increases when the process involves certain types of impairments that are  difficult to assess. More specifically, assessing medical improvement may  be more difficult in cases that involve certain types of psychological  impairments, such as depression, than cases with physical impairments,  such as amputations. In elaborating on their survey responses, 17 directors  commented that assessing medical improvement is more difficult in cases  with psychological impairments because evidence of these impairments is  generally more subjective than evidence of many physical impairments. In  addition, six directors commented that evaluations of psychological  impairments tend to rely more heavily on assessment of functionality.  According to some of these officials, an assessment of functionality is  more subjective because it relies more on the beneficiaries’ account of  their own conditions than on laboratory findings. Furthermore, some  officials reported that the severity of psychological impairments can  fluctuate over time, making it difficult to assess whether improvement has  taken place. Two directors commented that determining whether there is  medical improvement for some types of psychological impairments can  also be complicated because medical experts’ opinions can vary. One of  these directors commented that the evidence to support psychological  impairments, such as evaluations for depression, rely less on laboratory  findings and more on clinical judgment. In contrast, certain tests for  physical impairments tend to be less open to interpretation. For example,  one director commented that X-rays of joint deterioration can generally be  interpreted consistently among radiologists. The potential difficulty of  assessing medical improvement in beneficiaries whose disability is based  on certain types of psychological impairments is especially relevant, given  that the proportion of all individuals in the disability programs whose  disability is based on a psychological impairment has grown in recent  years.
section_title: Conclusions
paragraphs: SSA is responsible for assuring that individuals who truly have a disability  that prevents them from being able to work continue to receive benefits.  At the same time, SSA has a stewardship responsibility to identify those  beneficiaries who have improved medically and are no longer eligible for  benefits. The medical improvement standard is intended to help SSA  accomplish both of these responsibilities. However, several factors  associated with the standard pose challenges for ensuring that the  standard is implemented in a consistent and fair manner. Specifically,  potential limitations in SSA guidance regarding the degree of improvement  needed to meet the standard as well as a lack of clarity with respect to the  appropriate use of the exceptions to medical improvement may make it  difficult to assess if medical improvement has occurred. Clear guidance is  especially important in view of the judgmental nature of the disability  determination process. Additionally, while SSA guidelines regarding the  presumption of disability during CDRs tend to be generally clear, incorrect  application of these guidelines by several DDSs suggests that the  outcomes of CDRs could be affected and may result in benefit  continuation for some individuals who might otherwise been found to  have improved medically. Other factors, including inadequate  documentation of evidence, are more difficult to address in the short term.  However, SSA is taking actions intended to address some of these  problems.
section_title: Recommendation
paragraphs: To ensure that SSA is able to consistently assess whether DI and SSI  beneficiaries have improved medically, we recommend that the  Commissioner of Social Security clarify guidance for assessing medical  improvement when conducting CDRs. More specifically, SSA should  clarify guidance concerning (1) what degree of improvement is required to  meet the standard and (2) when the use of exceptions to medical  improvement is appropriate. SSA should also work with DDSs to ensure  that CDRs are conducted on a neutral basis, without a presumption that  beneficiaries continue to have a disability.
section_title: Agency Comments and Our Evaluation
paragraphs: We obtained written comments on a draft of this report from the  Commissioner of the Social Security Administration (SSA). The agency  generally agreed with our recommendation, but expressed reservations  about the need for further guidance on the use of exceptions. More  specifically, SSA believed that its implementation of the statutory  exceptions to medical improvement is appropriate and that its instructions  are consistent with the intent of the law. As such, SSA was concerned  about language in the draft report that characterized SSA’s guidance as  discouraging and limiting the use of the exceptions. After considering  these comments, we revised the report to include additional information  on (1) examiners’ confusion on the use of the exceptions when conducting  CDRs and (2) SSA’s rationale for its current exception guidance. Having  made these changes, we continue to believe that additional guidance in  this area is warranted if only, as the report notes, because most of the  disability examiners whom we spoke with told us that they were uncertain  about when to apply the exceptions. Moreover, while answering a survey  question on the exceptions to medical improvement, 4 DDS directors  commented that more guidance regarding the use of the exceptions is  needed.
SSA generally agreed with the need for clarifying guidance concerning the  degree of improvement required to meet the medical improvement  standard. However, the agency believed that the report was unclear with  regard to whether this part of the recommendation applied only to  guidance for determining if there has been any medical improvement, or  also to the guidance for determining if any medical improvement is related  to the ability to work. As stated in the draft report, our discussion of  medical improvement encompasses both elements (improvement in a  beneficiary’s medical condition and its relation to the ability to work).  However, we did further clarify this throughout the entire report to  minimize any confusion on this matter. Additionally, SSA indicated that  clarification of this guidance would probably have little noticeable impact  on the number of cases in which SSA finds that a disability has ended. As  our report notes, we cannot quantify the impact that clearer guidance  would have on the discontinuation of benefits. Even so, we continue to  believe that it is important for DDSs to consistently apply this aspect of  the medical improvement standard and that, towards that end, additional  guidance would be useful.
SSA agreed with the need for further training to ensure that CDRs be  conducted on a neutral basis. However, it believed that more adjudicator  training in this area would likely have little impact on discontinuing  benefits. We cannot predict the impact additional guidance and training  would have on continuing or discontinuing benefits. However, as the  report points out, there are large numbers of DDS directors who are  incorrectly applying the neutrality standard and, in our view, would  benefit from additional guidance in this area.
Beyond commenting on our recommendation, SSA suggested that we  provide additional context for some of the statistical information  presented in our discussion of the proportion of beneficiaries removed  from the disability programs each year. For example, SSA commented that  the disability discontinuation rates in the early 1980s may not have been  representative of the discontinuation rates prior to the implementation of  the medical improvement standard due to special targeted initiatives  aimed at removing individuals from the DI program who no longer had a  disability. We revised the report to take into account these suggestions.
The Commissioner’s comments have been reproduced in appendix III. SSA  also provided additional technical comments, which have been  incorporated in the report as appropriate.
Unless you publicly announce its contents earlier, we plan no further  distribution until 30 days after the date of this report. At that time, we will  make copies available to other parties upon request. In addition, the report  will be available at no charge on GAO’s Web site at http//:www.gao.gov.  This report does not contain all the results from the survey. The survey  and a more complete tabulation of the results can be viewed at  http://www.gao.gov/cgi-bin/getrpt?rptno=GAO-07-4sp.
If you or your staff have questions concerning this report, please contact  me at (202) 512-7215. Contact points for our Offices of Congressional  Relations and Public Affairs may be found on the last page of this report.  See appendix IV for a listing of major contributors to this report.
section_title: Appendix I: Scope and Methodology
paragraphs: This appendix provides additional details about our analysis of the  medical improvement standard (the standard), including challenges the  standard poses for the Social Security Administration (SSA) when  conducting medical continuing disability reviews (CDR). To meet the  objectives of this review, we reviewed prior studies by GAO, SSA, SSA’s  Inspector General, Congressional Research Service, and external  organizations related to the disability determination process and CDRs.  We also reviewed the Social Security Disability Benefits Reform Act of  1984, regulations, and SSA policies and processes for assessing whether  beneficiaries continue to be eligible for benefits. In addition, we analyzed  SSA data on CDR outcomes over a 7-year period for fiscal years 1999 to  2005 as well as reports identifying the number of beneficiaries who leave  the disability programs and the reasons why they leave. For the purposes  of our study, we only assessed DI and SSI adult beneficiaries who left the  programs as a result of receiving a full medical CDR. We did not include  children or “age 18 re-determinations” in our analysis since there are  differences between the medical CDR sequential evaluation processes for  adults and children. We also did not assess the outcome of CDR mailers or  work CDRs. We verified the statistical data on CDR outcomes for internal  logic, consistency, and reasonableness. We determined that the data were  sufficiently reliable for the purposes of our review. We also met with  knowledgeable SSA officials to further document the reliability of these  data.
We interviewed 34 officials from SSA’s central offices (including officials  from the Office of the Chief Actuary, the Office of Quality Performance,  the Office of General Counsel, the Office of Research and Evaluation  Statistics, the Office of Disability Programs, the Office of Disability  Adjudication and Review, and the Office of Program Development and  Research) to discuss the disability programs and the CDR process.
We conducted a national Web-based survey of all 55 Disability  Determination Services (DDS) directors in the 50 states, the District of  Columbia, Puerto Rico, the Virgin Islands, the Western Pacific Islands, and  the federal DDS. DDSs are the agencies responsible for conducting  periodic CDRs to determine if beneficiaries’ medical conditions have  improved and if they are able to work. We received 54 completed surveys  for a response rate of 98 percent. The purpose of this survey was to assess  the extent to which the standard impacts outcomes of CDRs and  determine if the standard poses any special challenges for SSA when  determining whether beneficiaries continue to be eligible for benefits. We  asked the directors about particular elements of the standard and how  these elements, alone or in combination with other factors, impact CDR  outcomes. We also asked them how SSA guidance on implementing the  standard affects CDR outcomes. We determined that the survey data are  sufficiently reliable. Because this was not a sample survey, there are no  sampling errors. However, the practical difficulties of conducting any  survey may introduce errors, commonly referred to as nonsampling errors.  For example, difficulties in how a particular question is interpreted, in the  sources of information that are available to respondents, or in how the  data are entered into a database or were analyzed, can introduce  unwanted variability into the survey results. We took steps in the  development of the questionnaire, the data collection, and the data  analysis to minimize these nonsampling errors. For example, social  science survey specialists designed the questionnaire in collaboration with  GAO staff with subject matter expertise. Then, the draft questionnaire was  pretested with a number of state officials to ensure that the questions were  relevant, clearly stated, and easy to comprehend. The questionnaire was  also reviewed by an additional GAO survey specialist. When the data were  analyzed, a second, independent analyst checked all computer programs.  Since this was a Web-based survey, respondents entered their answers  directly into the electronic questionnaire. This eliminated the need to have  the data keyed into a database thus removing an additional source of  error. We conducted three pretests of this survey with DDS directors in  three different states. We modified the survey to take their comments into  account. We also provided SSA with a copy of the survey and incorporated  its technical comments into the final version. This report does not contain  all the results from the survey. The survey and a more complete tabulation  of the results can be viewed at http://www.gao.gov/cgi- bin/getrpt?rptno=GAO-07-4sp.
To augment information from our state survey, we conducted independent  audit work in three states (California, Massachusetts, and Texas) to  examine how SSA policies and procedures are carried out in the field. We  selected locations for field visits based on the following criteria: (1)  geographic dispersion; (2) states with large numbers of CDRs conducted;  (3) states with CDR discontinuation rates above, below, and at the  national average; (4) states with varying DDS structures (i.e., centralized  and decentralized); and (5) states with large numbers of Disability  Insurance (DI) beneficiaries and large DI expenditures. In each state, we  visited a DDS office, the SSA regional office, the regional Office of Quality  Performance, and the regional Office of Disability Adjudication and  Review (formerly known as the Office of Hearings and Appeals). In total,  we conducted in-depth interviews with 80 SSA and DDS managers and line  staff responsible for conducting medical CDRs, including DDS directors,  CDR supervisors and examiners, medical consultants, and administrative  law judges.
During our meetings with SSA and DDS officials, we documented  management and staff views on the challenges associated with applying  the medical improvement standard. In particular, we documented  management and staff views on (1) the impact of the standard on CDR  outcomes, (2) the effectiveness of SSA policies and procedures for  applying the standard, and (3) the degree to which factors external to the  standard create challenges when determining if a beneficiary has  improved medically and is able to work. To further assess how the  standard is applied in practice, we took a nonprobability sample of 12 CDR  case files from the DDSs in California and Texas. We asked CDR  supervisors to provide several cases that were (1) discontinued for  medical improvement, (2) continued because the beneficiary was clearly  disabled, and (3) ambiguous cases where it was difficult to apply the  standard and determine if benefits should be continued or discontinued.  These case files serve to illustrate the difficulties examiners face when  determining if a beneficiary has improved medically and is able to work.
In addition, we interviewed seven disability policy experts from national  disability research and advocacy organizations to obtain their input on the  impact of the standard on the disability programs and any challenges it  poses when assessing individuals’ continued eligibility for benefits. We  spoke with individuals affiliated with the following organizations    American Association of People with Disabilities,    Center for Health Services Research and Policy at George Washington    Center for the Study and Advancement of Disability Policy,    Consortium for Citizens with Disabilities,    Disability Law Center,    Disability Policy Collaboration,    National Organization of Social Security Claimants’ Representatives,    National Organization on Disability.
Finally, we spoke with representatives from the National Association of  Disability Examiners, the National Council of Disability Determination  Directors, and the Social Security Advisory Board. We spoke with these  disability experts about the effect of the standard on CDR outcomes and  any challenges it presents when conducting CDRs. We conducted our  work from October 2005 through June 2006 in accordance with generally  accepted government auditing standards.
section_title: Appendix II: The Continuing Disability Review Evaluation Process
paragraphs: In the first step of the CDR evaluation process for adult beneficiaries, an  SSA field office representative determines if the beneficiary is working at  the level of substantial gainful activity (SGA). A beneficiary who is found  to be not working or working but earning less than the SGA level (minus  allowable exclusions) has his or her case forwarded to the state Disability  Determination Services (DDS).
The second step is to determine if the individual’s current impairment(s) is  included on the current list of disabilities that SSA maintains. The list  describes impairments that, by definition, are so severe that they are  disabling. If the individual’s current impairment(s) does meet or equal a  current listing, then the DDS continues the individual’s benefits and does  not continue with the evaluation process. If the individual’s current  impairment(s) does not meet or equal a current listing, then the DDS  proceeds to step three in the evaluation process.
The third step is to determine if improvement in the individual’s medical  condition has occurred. This improvement is any decrease in the medical  severity of the impairment(s) that was present at the time of the most  recent favorable medical decision (i.e., the initial decision to award  disability benefits or the most recent CDR continuance—usually referred  to as the comparison point decision, or CPD). At this step, the DDS  examiner compares the current signs, symptoms, and laboratory findings  associated with the beneficiary’s impairment(s) to those recorded from  the last review. If improvement has not occurred, the disability examiner  skips to the fifth step in the evaluation. If improvement has occurred, the  disability examiner proceeds to next step, the fourth step.
The fourth step is to determine if the improvement found in step three is  related to the ability to work. Improvement related to the ability to work is  evaluated two different ways, depending on whether the CPD was based  on: (1) meeting or equaling a prior listing or (2) a residual functional  capacity (RFC) assessment:    Meeting or equaling the prior listing: In this case, the disability  examiner will determine if the beneficiary’s same impairment(s) still  meets or equals the prior listing. Unlike step two, the examiner  compares the beneficiary’s condition with the list of impairments in  effect at the time he or she was first awarded disability benefits. If the  impairment(s) no longer meets or equals the prior listing, then the  examiner finds that the improvement is related to the ability to work  and proceeds to step six of the evaluation process. If the impairment(s)  meets or equals a prior listing, then benefits are continued.
Residual functional capacity assessment: In this case, the disability  examiner compares the beneficiary’s previous functional capacity to  the current functional capacity for the same impairment. If functional  capacity for basic work activities has improved, then the examiner  finds that the improvement is related to the ability to work and  proceeds to step six of the evaluation process. If the current  assessment does not show improvement, then the disability examiner  proceeds to step five.
The fifth step is to determine whether an exception to medical  improvement applies. The law provides for certain limited situations when  the DDS may discontinue a recipient’s benefits even though medical  improvement has not occurred. The specific group I exceptions are (a) the  individual is the beneficiary of advances in medical or vocational therapy  or technology (related to the ability to work), (b) evidence shows that the  individual has undergone vocational therapy (related to the ability to  work), (c) evidence shows that, based on new or improved diagnostic or  evaluative techniques, the individual’s impairment(s) is not as disabling as  it was considered at the time of the CPD, and (d) evidence shows that any  prior determination or decision was in error. If an exception applies, the  examiner continues through to step six of the evaluation process. If an  exception does not apply, benefits are continued.
The sixth step is to determine if the current impairments are severe. At  this step, the examiner considers all of the beneficiary’s impairments— those present at the previous decision as well as any new impairments  found in the current review. If the DDS determines that the beneficiary’s  current impairment(s) is not severe, benefits are discontinued without  further development. If it is determined that the impairment(s) is severe,  then the examiner considers the impact of the beneficiary’s impairment(s)  on his or her ability to function. This consideration will result in a current  residual functional capacity (RFC) assessment that shows the  beneficiary’s ability to do basic work activities and the evaluation  continues to the seventh step.
The seventh step is to determine whether the beneficiary has the capacity  to do the work that he or she did before having a disability. If the  beneficiary has the ability to do past work, then benefits are discontinued.  If the beneficiary does not have the ability to do work he or she has done  in the past, the evaluation continues to the eighth step.
The eighth step is to determine if the beneficiary has the ability to do other  work. At this step, the disability examiner considers the complete  vocational profile (the beneficiary’s age, education, and past relevant work  experience) together with the beneficiary’s RFC to determine if he or she  has the ability to do other work. If the beneficiary has the ability to do  other work, disability benefits are discontinued. If he or she does not have  the ability to do other work, benefits are continued.
section_title: Appendix III: Comments from the Social Security Administration
section_title: Appendix IV: GAO Contact and Staff Acknowledgments
paragraphs: Robert E. Robertson, Director, (202) 512-7215.
subsections: section_title: Staff Acknowledgments
paragraphs: The following team members made key contributions to this report:   Kelly Agnese; Jeremy D. Cox; Susan E.M. Etzel; Stuart M. Kaufman; Luann  M. Moy; George H. Quinn, Jr.; Daniel A. Schwimer; Salvatore F. Sorbello;  Wayne T. Turowski; Vanessa R. Taylor; and Rachael C. Valliere.
section_title: Related GAO Products
paragraphs: Social Security Administration: Agency Is Positioning Itself to  Implement Its New Disability Determination Process, but Key Facets  Are Still in Development. GAO-06-779T. Washington, D.C.: June 15, 2006.
Social Security Disability Insurance: SSA Actions Could Enhance  Assistance to Claimants with Inflammatory Bowel Disease and Other  Impairments. GAO-05-495. Washington, D.C.: May 31, 2005.
High Risk Series: An Update. GAO-05-207. Washington, D.C.: January  2005.
SSA’s Disability Programs: Improvements Could Increase the Usefulness  of Electronic Data for Program Oversight. GAO-05-100R. Washington,  D.C.: December 10, 2004.
Disability Insurance: SSA Should Strengthen Its Efforts to Detect and  Prevent Overpayments. GAO-04-929. Washington, D.C.: September 10,  2004.
Social Security Administration: More Effort Needed to Assess  Consistency of Disability Decisions. GAO-04-656. Washington, D.C.: July  2, 2004.
Social Security Disability: Commissioner Proposes Strategy to Improve  the Claims Process, but Faces Implementation Challenges. GAO-04-552T.  Washington, D.C.: March 29, 2004.
SSA Disability Decision Making: Additional Steps Needed to Ensure  Accuracy and Fairness of Decisions at the Hearings Level. GAO-04-14.  Washington, D.C.: November 12, 2003.
Social Security Disability: Reviews of Beneficiaries’ Disability Status  Require Continued Attention to Achieve Timeliness and Cost- Effectiveness. GAO-03-662. Washington, D.C.: July 24, 2003.
Social Security Disability: Reviews of Beneficiaries’ Disability Status  Require Continued Attention to Improve Service Delivery. GAO-03-1027T.  Washington, D.C.: July 24, 2003.
High Risk Series: An Update. GAO-03-119. Washington, D.C.: January  2003.
Major Management Challenges and Program Risks: Social Security  Administration. GAO-03-117. Washington, D.C.: January 2003.
SSA and VA Disability Programs: Re-Examination of Disability  Criteria Needed to Help Ensure Program Integrity. GAO-02-597.  Washington, D.C.: August 9, 2002.
SSA Disability Programs: Fully Updating Disability Criteria Has  Implications for Program Design. GAO-02-919T. Washington, D.C.: July  11, 2002.
Social Security Disability: SSA Making Progress in Conducting  Continuing Disability Reviews. GAO/HEHS-98-198. Washington, D.C.:  September 18, 1998.
Supplemental Security Income: SSA Is Taking Steps to Review  Recipients’ Disability Status. GAO/HEHS-97-17. Washington, D.C.:  October 30, 1996.
Social Security Disability: SSA Quality Assurance Improvements Can  Produce More Accurate Payments. GAO/HEHS-94-107. Washington, D.C.:  June 3, 1994.
Social Security: Disability Rolls Keep Growing, While Explanations  Remain Elusive. GAO/HEHS-94-34. Washington, D.C.: February 11, 1994.
Social Security Disability: Implementing the Medical Improvement  Review Standard. GAO/HRD-88-108BR. Washington, D.C.: September 30,  1988.
Social Security Disability: Implementation of the Medical Improvement  Review Standard. GAO/HRD-87-3BR. Washington, D.C.: December 16,  1986.
Review of the Eligibility of Persons Converted from State Disability  Rolls to the Supplemental Security Income Program. HRD-78-97.  Washington, D.C.: April 18, 1978.