Modernizing SSA Disability Programs: Preliminary Observations on Updates of Medical and Occupational Criteria
Published: 2012-03-20T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: SSA administers two of the largest disability programs, with annual benefit payments that have grown fivefold over the last 20 yearsfrom $35 billion in 1990 to over $164 billion in 2010and the agency receives millions of new applications annually. GAO has designated federal disability programs as a high-risk area, in part because eligibility criteria have not been updated to reflect medical and technological advances and labor market changes. Given the size and cost of its disability programs, SSA needs updated criteria to appropriately determine who qualifies for benefits.
In this statement, GAO discusses initial observations from its ongoing review and assessment of SSAs efforts to (1) update its medical criteria and (2) develop a new occupational information system. To do this, GAO reviewed prior GAO and SSA Inspector General reports; relevant federal laws and regulations; program documentation including policies, procedures, strategic goals, and supporting project plans; and cost estimates. GAO also interviewed SSA officials, project stakeholders, experts, and representatives from other agencies that administer disability programs. This work is ongoing and GAO has no recommendations at this time. GAO plans to issue its final report later in 2012.
section_title: What GAO Found
paragraphs: The Social Security Administration (SSA) has made several changes to improve the process it uses for updating its medical criteria, but continues to face challenges ensuring timely updates. SSAs medical criteria for adults are in the form of listings of medical conditions and impairments organized under 14 body systems, which SSA periodically updates. To help ensure timely, periodic updates of a body systems listings, SSA is moving away from comprehensively revising a body systems listings toward a more targeted approach, wherein SSA selects for revision those impairment listings most in need of change. To date, SSA has completed comprehensive revisions of listings for 8 of the 14 body systems and now is in the process of reviewing them to determine whether and which targeted revisions are appropriate. In 2010, the SSA Commissioner set a 5-year cycle time for updating listings for each body system, replacing the agencys prior practice of setting expiration dates for listings that ranged from 3 to 8 years and then frequently extending them. To further increase the timeliness and accuracy of decisions, SSA has sought recommendations from the Institute of Medicine and has acted on some of them, such as creating a standing committee to provide advice on updating the listings. However, SSA continues to face challenges keeping its listings up to date. For example, SSA is still working on completing comprehensive revisions of listings for six body systems that have been ongoing for 19 to 33 years. SSA staff told us that a lack of staff and expertise, along with the complexity and unpredictability of the regulatory process, have made it challenging to maintain its schedule of periodic updates for all listings.
SSA has embarked on an ambitious plan to produce by 2016 an occupational inventory database to support its disability benefit decisions, but it is too soon to determine if SSA will meet key time frames. SSA currently relies on an occupational information source developed by the Department of Labor that was updated for the last time in 1991 and is viewed by many as outdated. In 2008, SSA initiated a project to develop its own occupational information system (OIS), which SSA expects will provide up-to-date information on the physical and mental demands of work, and in sufficient detail to support its disability benefit decisions. To guide the creation of its OIS, SSA established an advisory panel, collaborated with outside experts and other agencies, and in July 2011 issued a research and development plan detailing all relevant activities and goals between 2010 and 2016. As of February 2012, SSA had completed many initial research efforts, including investigating other types of occupational information systems and identifying job analysis methods. Despite preliminary progress, it is too early to determine if SSA will meet its target implementation date. SSA officials told us that due to staffing shortages it did not meet all initial goals on time and may need to adjust its time frames for future activities. While GAO is still evaluating SSAs schedule and cost estimates against best practices, we have preliminarily identified some potential gaps in SSAs approach, such as not reflecting the costs to both implement and maintain a new OIS.

section_title: Letter
paragraphs: I am pleased to be here today to discuss our preliminary observations on  efforts by the Social Security Administration (SSA) to modernize its  disability criteria. In the last 20 years, SSA disability benefit payments to  beneficiaries and their dependents have increased almost fivefold, from  $35 billion in 1990 to over $164 billion in 2010. The number of working- age beneficiaries also grew from about 9 million in 2000 to almost 12  million in 2010, and, as more baby boomers enter their disability-prone  years, SSA expects the number of claims to grow. Given the extensive  size and cost of its disability programs, SSA must have current and  appropriate criteria by which to assess whether an applicant’s medical  conditions affect his or her ability to perform work in the national  economy. GAO has designated SSA’s federal disability program as a  high-risk area; in 2008, we reported that the agency’s medical criteria did  not fully reflect medical and technological advances, and the occupational  criteria it used from the Department of Labor (Labor) had not been  updated since 1991, despite the trend away from manual labor jobs and  towards service- and knowledge-based jobs.
My statement today focuses on initial observations from our ongoing  review for this subcommittee and examines the status and management  of SSA’s efforts to (1) update its medical listings to reflect current medical  knowledge and (2) develop its own occupational information system (OIS)  to reflect labor market changes. To examine these issues we reviewed  prior GAO and SSA Office of Inspector General reports; relevant federal  laws and regulations; program documentation including policies,  procedures, strategic goals, and supporting project plans and cost  estimates; and position papers and testimonies from disability groups and  commissions. We interviewed SSA officials, key project contractors and  stakeholders, disability experts, and representatives of other agencies  that administer disability programs. In our ongoing work, we will further  evaluate SSA’s plan to develop its own OIS against best practices for  cost estimating and scheduling. We will also review more broadly other  steps SSA is taking to incorporate modern concepts of disability into its  programs. We plan to issue our final report later in 2012 in accordance  with generally accepted government auditing standards. Those standards  require that we plan and perform the audit to obtain sufficient, appropriate  evidence to provide a reasonable basis for our findings and conclusions  based on our audit objectives. We believe that the evidence obtained  provides a reasonable basis for our findings and conclusions based on  our audit objectives.
subsections: section_title: Background
paragraphs: SSA administers two of the largest disability programs: the Disability  Insurance (DI) program, enacted in 1956, and the Supplemental Security  Income (SSI) program, enacted in 1972. In order to be eligible for DI or  SSI benefits based on a disability, an individual must meet the definition  of disability for these programs—that is, they must have a medically  determinable physical or mental impairment that (1) prevents the  individual from engaging in any substantial gainful activity, and (2) has  lasted or is expected to last at least one year or result in death.
To determine eligibility, SSA uses a five-step sequential process that is  intended, in part, to expedite disability decisions when possible and limit  administrative costs by conducting less intensive assessments at earlier  steps (see fig. 1). At steps 1 and 2 of the process, SSA determines  whether an applicant is working and meets income thresholds as well as  the medical severity of impairments. If so, the applicant moves to step 3  of the process. At this step, SSA examiners assess the applicant’s  medical impairment(s) against the Listings of Impairments, also known as  the medical listings, which are organized into 14 major body systems for  adults and reflect medical conditions that have been determined by the  agency to be severe enough to qualify an applicant for benefits. If the  individual’s impairment meets or is equal in severity to one or more of  those in the listings, the individual is determined to have a disability. If  not, SSA performs an assessment of the individual’s physical and mental  residual functional capacity. Based on this assessment, SSA determines  whether the individual is able to perform past relevant work (step 4) or  any work that is performed in the national economy (step 5). To inform  determinations at steps 4 and 5, SSA uses a Department of Labor  database—known as the Dictionary of Occupational Titles (DOT)—for an  inventory of occupations performed in the national economy.
Since 2003, SSA’s and other federal disability programs have remained  on our high-risk list, in part, because their programs emphasize medical  conditions in assessing work capacity without adequate consideration of  work opportunities afforded by advances in medicine, technology, and job  demands. Since the 1990s, we, along with SSA’s Office of Inspector  General and the Social Security Advisory Board, have expressed  concerns that the medical listings being used no longer provide sufficient  criteria to evaluate disability applicants’ inability to work and that SSA was  simply extending the listings instead of periodically updating them. In  2008, we reported that SSA had established a new process for revising  the listings—referred to by SSA as the “business process”—to better  incorporate feedback into its continuous updates. This process, which  has been in effect since 2003, includes incorporating feedback from  multiple parties, including medical experts and claims examiners, to  update their medical criteria. SSA should also gather external feedback  through comments associated with regulatory actions, such as the  publication of advanced notices of proposed rulemaking (advanced  notices) and notices of proposed rulemaking (notices) in the Federal  Register. In addition, one year after a revision is made, SSA should  conduct a study reviewing the changes. According to SSA  documentation, this internal case study, now referred to as the  postimplementation study, should involve surveying the field regarding  the results of the regulation and areas to improve, as well as reviewing  the data to determine whether expectations from the revision have been  proven.
With respect to information on jobs in the national economy that supports  SSA’s occupational criteria, we and others have reported that the DOT,  which SSA still relies on to assess eligibility at steps 4 and 5 of the  process, is outdated. The DOT has not been updated since 1991, and  Labor has since replaced the DOT with a new database called the  Occupational Information Network (O*NET).determined that O*NET is not sufficiently detailed for evaluating DI and  SSI disability claims and therefore has begun developing its own OIS in  order to better reflect the physical and mental demands of work in the  national economy.
section_title: SSA Has Improved Its Process for Updating Medical Listings, but Faces Challenges Completing Updates
subsections: section_title: SSA Has Improved Its Strategy to Update Medical Listings
paragraphs: Since our last review in 2008, SSA has made several changes that hold  promise for improving medical listings updates. First, the agency is using  a two-tiered system for ongoing revisions to the listings. Under this  system, SSA first completes a comprehensive listings update for a body  system that reviews all the diseases and disorders listed within that  system and makes revisions it determines are needed. For subsequent  updates of listings for a body system that underwent a comprehensive  revision, SSA will pursue a more targeted approach—that is, SSA will  conduct ongoing reviews with the expectation of making targeted  revisions for a small number of medical diseases or disorders that need to  be updated. Agency officials told us that targeted updates should be  completed more quickly than comprehensive updates, allowing them to  focus on the most critical changes needed. However, officials also noted  that these ongoing reviews could result in major or even no changes, as  appropriate. As of early March 2012, SSA had begun the ongoing review  process to consider opportunities for targeted revisions for 8 out of 14  adult body systems that were recently comprehensively revised. Also as  of early March 2012, the agency had not yet completed comprehensive  revisions for the six remaining systems, which the agency expects to do  before they conduct subsequent reviews under the targeted approach.
Another change, according to agency officials, is that in 2010 the SSA  Commissioner set a 5-year cycle time for updating listings for each body  system. Previously, SSA set expiration dates for periodically updating  listings according to each body system, ranging from 3 to 8 years, but  frequently extended them. SSA officials believe that conducting targeted  reviews will generally allow the agency to conclude any necessary  revisions prior to the 5-year expiration period. Additionally, they expect  that using the “business process,” which requires early public notification  of changes and obtaining necessary data and feedback from internal and  external parties, should help keep continuous reviews on track. See figure  2 for the status and expiration dates of listings for the 14 adult body  systems, undergoing review for either comprehensive or possible  targeted revisions, as of early March 2012.
SSA has made another change by more extensively engaging the  medical community to identify ways to improve the medical listings. For  example, SSA contracted with the Institute of Medicine to study its  medical criteria for determining disability and to make recommendations  for improving the timeliness and accuracy of its disability decisions,  resulting in a 2007 report with recommendations and a symposium of  experts in 2010. SSA has addressed some of the institute’s  recommendations, such as making better use of its administrative data to  update criteria and creating a standing committee through the institute to  provide recommendations for listings revisions.
section_title: SSA Has Experienced Delays with Its Revision Process
paragraphs: SSA continues to face delays in completing both comprehensive and  other ongoing updates. For example, as of early March 2012, SSA  officials told us they still needed to complete comprehensive revisions for  listings of six body systems that have been ongoing for the last 19 to 33  years, after numerous extensions beyond the original expiration periods  (see table 1). Two of the remaining six body system listings—mental and  neurological disorders, which are among those SSA uses most frequently  in its eligibility determination process—have not been comprehensively  revised for 27 years.to expire in 2012. Of these four, SSA is developing a notice of proposed  rulemaking for three of them and has issued a notice on the fourth.  However, it is unclear whether SSA will complete the revisions before  they are set to expire.
section_title: SSA Has Begun an Ambitious Project to Develop Its Own Source of Occupational Information
subsections: section_title: SSA is in the Preliminary Stage of Developing a New Up-to-Date Source of Occupational Information
paragraphs: In 2008, SSA began a multiyear project to develop a new source of  occupational information that will replace the outdated information  currently being used to determine if claimants are able to do their past  work or any other work in the national economy. Since the 1960s, SSA  has been using the DOT, which contains a list of job titles found in the  national economy and was last updated in 1991. The DOT provides  SSA with descriptions of the physical demands of work—such as  climbing, balancing, and environmental requirements—for each of the  more than 12,000 occupations listed. According to SSA, these  descriptions have been essential to its evaluations of how much a  claimant can do despite his or her impairment and whether this level of  functioning enables the claimant to do his or her past work or any other  work. After its last limited update, Labor decided to replace the DOT with  O*NET, which has far fewer job titles compared with the DOT, but has  served Labor’s purposes more efficiently. According to an SSA report,  after investigating potential alternatives, SSA decided that O*NET and  other existing databases with occupational information were not  sufficiently detailed and able to withstand legal challenges for use in its  decision-making process. SSA further decided to develop its own  occupational information system, which would contain detailed  information as in the DOT, but would also include additional information,  such as the mental demands of work. In addition, the OIS should (1) meet  SSA’s legal, program, and data requirements; (2) be flexible enough to  incorporate changes in SSA’s policies and processes; and (3) be able to  be updated to reflect the evolving workplace environment.
In 2008, SSA began taking several steps to guide the development of its  OIS. SSA created an internal office and working group, as well as an  Occupational Information Development Advisory Panel, comprised of  external experts in areas related to the development of occupational  information systems. The advisory panel holds quarterly public meetings  and has several subcommittees that review material and make  recommendations to SSA on developing various components of the OIS.  For example, in a 2009 report, the advisory panel supported the need for  SSA to develop a new source of occupational information, rather than  adapt O*NET, and recommended the type of data SSA should collect, as  well as suggested ways to classify occupations.
To further inform its efforts, SSA has sought input from agencies or  organizations that either collect occupational information or also use the  DOT. For example, SSA officials held initial meetings with Labor and U.S.  Census Bureau officials to gain information on sampling methods used for  the O*NET, the Occupational Employment Statistics program, and  Census Bureau’s household surveys. in the process of completing a Memorandum of Understanding that will  formalize their collaboration efforts on the new OIS. According to an SSA  official, as the OIS project progresses, SSA plans to convene ad hoc  roundtables with experts and other agency officials to explore specific  subject areas, such as sampling issues. Besides working with Labor and  Census Bureau officials, SSA officials and panel members have sought  input from other experts and current users of the DOT, such as SSA  disability adjudicators and external rehabilitation professionals, by  conducting a user needs analysis in 2009 and presenting the OIS project  at events and conferences.
The Occupational Employment Statistics program produces employment and wage  estimates for approximately 800 occupations. The Census Bureau’s household surveys  include (1) the American Community Survey, which is an ongoing survey that provides  annual data on demographics such as age, education, and disabilities, and (2) the Current  Population Survey , which is primarily a labor force survey, conducted every month by the  Census Bureau for the Bureau of Labor Statistics and provides data such as the national  unemployment rate. key components of the OIS in order to implement the OIS by 2016 at an  estimated cost of $108 million. For example, the plan includes several  baseline activities to identify and study other occupational information  systems and various approaches for analyzing occupations that may  inform or could be leveraged in SSA’s OIS data collection. The plan also  includes activities to identify the primary occupational, functional, and  vocational characteristics of current beneficiaries. Other key components  of the plan include developing descriptions of work requirements, such as  the physical and mental demands for jobs, and data collection and  analysis strategies. SSA also plans to develop a strategy for piloting data  collection nationwide within this time frame.
section_title: SSA Has Made Progress on Its OIS, but It Is Too Soon to Know if Project Timelines Will be Met
paragraphs: As of February 2012, SSA had made progress on many of the baseline  activities outlined in its research and development plan for the OIS. For  example, according to an SSA official, its investigation of existing  occupational information systems, now complete, has resulted in useful  information about design issues other organizations have confronted and  mitigated when creating their own system. Additionally, SSA’s preliminary  analysis of its own administrative data identified the most frequently cited  occupations and functional and vocational characteristics of disability  applicants. SSA officials told us the agency will target the occupations  identified in this analysis for its pilot studies of the OIS. Also in 2011, SSA  completed a comprehensive framework for assessing an individual’s  capacity to work—key to informing the OIS content, according to SSA  officials—which was based on recommendations of outside experts as  well as SSA’s policy and program requirements.
While SSA has made progress on several key activities, agency officials  delayed 2011 completion dates for certain activities and anticipate making  additional changes to its timeline as a result of not meeting its staffing  goals for fiscal year 2011. For example, the activities that were delayed  by several months included finalizing reports for the baseline studies and  conducting a literature review that would inform how occupations might  be analyzed for the OIS. SSA officials told us that they would have  needed to have the full complement of projected 2012 staff by September  2011 to complete all of the 2012 planned activities within the estimated  schedule. However, SSA officials said they did not have the budget to  hire new staff in September 2011. To address this challenge, SSA  officials hired consultants to meet some of their needs. SSA officials also  met with the Office of Personnel Management to explore the possibility of  an interagency agreement that would allow SSA to use one or two of the  Office of Personnel Management’s industrial organizational psychologists  to help on a part-time basis.
As part of our ongoing work, we are assessing SSA’s current OIS project  schedule and cost estimates against best practices, and have  preliminarily identified some gaps in SSA’s approach. For example, best  practices require cost estimates to be comprehensive and include  information about life cycle costs—that is, how much the project is  expected to cost over time. However, while SSA has estimated the cost to  research and develop the OIS, the estimate does not project the future  costs to implement or maintain the system. The cost of sustaining an OIS  could be significant, based on other agencies’ experiences maintaining  their systems for collecting national occupational information. We  preliminarily identified other gaps, such as lack of documentation  describing step by step how the cost estimate was developed so that  those unfamiliar with the program could understand how it was created.  For our final report due later in 2012, we plan to deliver more  comprehensive findings on how well SSA is managing the development  of its OIS against best practices, such as estimating costs of the OIS and  ensuring that the project schedule reliably estimates related activities, the  length of time they will take, and how they are interrelated. We will also  identify any mitigation strategies the agency may have to address project  risks, such as the risk of the agency not receiving full funding.
Chairman Johnson, Ranking Member Becerra, and Members of the  Subcommittee, this concludes my prepared statement. I will be happy to  respond to any questions.
section_title: Contact and Acknowledgments
paragraphs: For further information regarding this testimony, please contact me at  202-512-7215 or bertonid@gao.gov. In addition, contact points for our  Offices of Congressional Relations and Public Affairs may be found on  the last page of this statement. Individuals who made key contributions to  this testimony are Michele Grgich, Assistant Director, James Bennett,  Kate Blumenreich, Julie DeVault, Alex Galuten, Sheila McCoy, Patricia M.  Owens, Anjali Tekchandani, Kathleen Van Gelder, and Walter Vance.
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