SSA Disability: Enhanced Procedures and Guidance Could Improve Service and Reduce Overpayments to Concurrent Beneficiaries
Released: 2002-09-05T00:00:00

Letter

Background

SSA administers two programs that provide benefits for individuals who are unable to work because of disability. Although they differ with respect to program purpose and requirements for entitlement, both DI and SSI use the same definition of disability for initial entitlement. Specifically, in order to be found disabled, an individual must have a medically determinable physical or mental impairment that (1) has lasted or is expected to last at least one year or result in death and (2) prevents an individual from engaging in substantial gainful activity.

DI was established in 1956 as an insurance program to help replace earnings lost because of disability. To be eligible for benefits, individuals with disabilities must have a specified number of recent work credits under Social Security based on age as of onset of disability. Individuals may also be able to qualify on the work record of a deceased, retired, or disabled parent or a deceased spouse. Benefits are financed by payroll taxes paid by covered workers and their employers, and are linked to the worker’s earnings history. In most cases, individuals who have been entitled to DI benefits for 24 months qualify for Medicare.

The SSI program was established in 1972 to provide a standard minimum level of income for individuals with disabilities, as well as aged individuals, who have limited income and assets. Eligibility does not require a past work history. Benefits are paid from general revenues and, in general, most beneficiaries are eligible for the same benefit amount. However, other income counts against this benefit amount, usually resulting in a reduction in that amount. In most states, entitlement to SSI means automatic entitlement to Medicaid.

Most beneficiaries qualify for either one program or the other; however, receipt of benefits under one program does not necessarily preclude entitlement under the other program. Beneficiaries who are receiving one benefit may transition to the other benefit or they may receive both benefits concurrently. Receiving an SSI benefit has no bearing on continuing entitlement to DI benefits. However, because SSI is a means- tested program, the amount of the DI benefit must be considered in determining whether an individual with a disability also qualifies for SSI. If the amount of the DI benefit is low and all other income and resource factors are met, a DI beneficiary may also receive an SSI benefit. Concurrent beneficiaries who are covered by Medicaid and who have been entitled to DI long enough to qualify for Medicare may also be eligible for payment of their Medicare premiums and co-payments by their state. The minimum value of these payments would be $54.00 a month.

Both programs feature work incentive provisions that are intended to encourage beneficiaries to return to work. However, the provisions of the two programs differ significantly, providing different levels of safeguards for continuing eligibility, income, and medical coverage for DI and SSI beneficiaries. For example, earnings, regardless of the amount, do not affect a DI beneficiary’s cash benefit for a period of time known as the trial work period. However, benefits will eventually stop completely after this period if earnings exceed a specified level. In contrast, earnings can affect an SSI beneficiary’s cash benefit immediately but the reduction in benefits is gradual with a reduction in benefits of $1 for every $2 earned over the first $65. Table 1 highlights each program’s work incentive provisions in effect at the time the Ticket to Work and Work Incentives Improvement Act of 1999 called for this study. Even with the work incentive provisions in the two programs, relatively few disability beneficiaries work and no more than 1 percent leave the DI and SSI beneficiary rolls each year because of their work.

DI and SSI beneficiaries who do return to work are responsible for reporting their work activity to SSA as soon as it occurs. SSA has no specific provisions for adjusting benefits for concurrent beneficiaries who work and must apply the work incentive provisions of the two programs independently to determine whether an individual remains entitled to DI and SSI and, if so, the amount of each benefit. Most concurrent beneficiaries interact with SSA through its network of nearly 1,300 field offices. To cope with the complexity of its programs, most of these field offices use employees who specialize in either the Social Security programs, including the DI program, or the SSI program. The remaining offices use generalist employees who are trained in both programs. To supplement the information provided by its staff, SSA also publishes several pamphlets that explain the provisions of the DI and SSI programs. Two of these publications, Red Book on Employment Support and Working While Disabled—How We Can Help, provide information about the effect of work on DI and SSI benefits.

There Are Over 1 Million Concurrent Beneficiaries and Few Work

Concurrent beneficiaries, who comprised about 14 percent of SSA’s disability population, were likely to have mental impairments and be female. In addition, their average age was 45. About 11 percent of concurrent beneficiaries worked and had a median earned income of about $250 a month. More than three-quarters of those who worked have mental impairments—mental illness and mental retardation. Individuals with mental retardation worked at twice the rate of beneficiaries with mental illness, but earned much less. The median earnings of beneficiaries with mental retardation were nearly half those of beneficiaries with mental illness.

More than One-half of Concurrent Beneficiaries Have Mental Impairments

Of the more than 6 million working-age adults receiving disability benefits under the DI program and the more than 3.5 million working-age adults receiving SSI, our analysis of the February 2002 SSA data indicates that, approximately 1.2 million—14 percent—received benefits from both programs. These beneficiaries were an average age of 45, with fewer than 15 percent between the ages of 17 and 30. In addition, 53 percent were female. Concurrent beneficiaries received an average DI payment of about $430 per month and an SSI payment of about $150 per month. The majority of concurrent beneficiaries qualified for DI benefits on the basis of their work record. The remainder received benefits on the basis of the work history of a deceased, disabled, or retired parent (25 percent); or their deceased spouse (3 percent).

Over half of concurrent beneficiaries had a mental impairment—a third had mental illness and about a quarter had mental retardation. Approximately one-ninth of concurrent beneficiaries had an impairment related to their muscular or skeletal system. The remaining beneficiaries had one of a wide range of impairments as their primary impairment.

About 11 Percent of Concurrent Beneficiaries Work but Earn Relatively Low Wages

Of the approximately 142,000 concurrent beneficiaries who worked, almost 80 percent had a mental impairment. Concurrent beneficiaries who worked were more likely to have mental retardation, tended to be younger, and male. As shown in figure 1, while individuals with mental retardation made up only a quarter of the concurrent population, they accounted for over half of the concurrent beneficiaries who worked. Moreover, nearly half may not have had a significant work history. Instead, they qualified for benefits on the basis of the work history of a parent or spouse.

Most concurrent beneficiaries who worked earned low wages, but earnings levels varied by impairment categories. While the median earned income of all working concurrent beneficiaries was approximately $250 per month, more than one-quarter earned $65 per month or less. Workers with mental retardation had median monthly earnings of about $200, compared with about $400 for concurrent beneficiaries with mental illness. However, the median earned income for concurrent beneficiaries eligible for DI benefits on the basis of the work history of a deceased, disabled, or retired parent was only $85 per month.

A higher proportion of concurrent beneficiaries worked than SSI beneficiaries, but they earned much less. Fewer than 8 percent of SSI beneficiaries worked, but they had median earnings of $400, compared with about $250 for concurrent beneficiaries. More than one-quarter of SSI beneficiaries earned $1,000 per month or more, greater than three times the percentage of concurrent beneficiaries with earnings at that level. Table 2 provides the percentage of concurrent and SSI beneficiaries that were earning at the levels listed. The difference in earnings may be explained, in part, by the higher proportion of working concurrent beneficiaries with mental retardation as compared with SSI beneficiaries. However, this higher incidence of beneficiaries with mental retardation does not completely explain the difference in earnings since the earnings for SSI beneficiaries with mental retardation were higher than those for concurrent beneficiaries with mental retardation. For example, median monthly earnings for SSI beneficiaries with mental retardation were $250 compared with $200 for concurrent beneficiaries with the same impairment.

Our analysis of data available on the use of work incentives indicated that, while 11 percent of concurrent beneficiaries worked, they did not take advantage of most of the work incentives available to them under the SSI and/or DI programs. Most concurrent beneficiaries who worked used the earned income exclusion under the SSI program that reduces cash benefits by $1 for every $2 earned, but the other incentives were not widely used. The next most frequently used work incentive was the Impairment Related Work Expenses provision, which allows beneficiaries to exclude the costs of certain impairment-related items and services needed to work. It was used by fewer than 3 percent of concurrent beneficiaries who worked. Concurrent beneficiaries’ use of work incentives was comparable to that of SSI beneficiaries. Because beneficiaries may not meet all the eligibility requirements for work incentives, it may be difficult to determine whether the low rates of use of work incentives were attributable to the inability to meet eligibility factors or lack of understanding of the provisions.

Little Coordination of DI and SSI Programs Exists for Concurrent Beneficiaries Who Work

There is little coordination between SSI and DI program rules, especially for concurrent beneficiaries who work and, as a result, SSA must apply the complex provisions of the two programs independently. The specialization of most SSA field office staff in either the DI or SSI program makes it difficult to serve concurrent beneficiaries effectively. Specialists in one program lack integrated guidance to readily determine the effect of work on the benefits in the other program. Moreover, because the guidance does not adequately cross reference the DI and SSI rules that pertain to concurrent beneficiaries, these specialists may not recognize the need to communicate information about work to the other program as required by SSA guidance. In addition, SSA has not established formal operating procedures that ensure that this information is collected and communicated nor has it established a monitoring system to ensure that appropriate actions are taken. Because information on the work activities of concurrent beneficiaries may not be exchanged between the two programs or acted on in a timely manner, SSA may be overpaying benefits. SSA took steps recently that have the potential for improving service to concurrent beneficiaries and increasing the accuracy of their payments by better coordinating the administrative process related to work activity. For example, SSA officials have created a new position and new software to handle work-related issues for all beneficiaries, which could provide better integrated service to concurrent beneficiaries. Because these initiatives are still being tested and evaluated, it is too early to know whether they will have the intended effect if implemented nationwide.

Lack of Integrated Guidance and Operational Procedures Increases the Difficulty Specialized Staff Have in Effectively Serving Concurrent Beneficiaries

SSA’s guidance for administering the DI and SSI programs may contribute to the difficulty encountered by staff that specialize in one program but are required to collect information about both programs for concurrent beneficiaries. SSA’s written guidance for both programs is contained in a voluminous document of about 35,000 pages divided into multiple parts. A DI specialist collecting work activity information from a concurrent beneficiary may find it challenging to use the multi-part guidance for DI benefits and even more challenging to use the guidance for SSI that would also be needed for a concurrent beneficiary.

SSA guidance does not provide integrated instructions for processing work information reported for concurrent beneficiaries or an integrated explanation of the effect of work on both DI and SSI benefits. Available guidance usually segregates information by program and provides little cross-referencing to issues that may be common to both programs. In addition, the cross-referencing that is provided does not always direct specialists to the specific procedures to follow for the other program. For example, the guidance for dealing with a DI beneficiary who returns to work contains a single cross-reference to an 81 page section of SSI policy and procedural statements. However, this 81 page section does not explain the basic effect of work on benefits. To determine the specific procedures and how work affects the person’s SSI benefits, the DI specialist would need to go to yet another section of SSI guidance without the benefit of a cross-reference to find it. The need for efficient and accessible guidance is particularly important in field offices where heavy workloads and changing priorities often compete for employee attention.

The lack of integrated guidance may contribute to SSA not collecting all the required information on concurrent work beneficiaries. In some offices, concurrent beneficiaries report their work activity to either a DI or SSI specialist who collects the information he or she believes necessary to determine the amount of benefits that should be paid under both programs. Some specialists reported that they did not always know when an individual was a concurrent beneficiary and did not always know what information to collect about the other program. In other offices, a concurrent beneficiary reported to a specialist in each program. If the beneficiary is unable to meet with both specialists, SSA may not collect all the information needed to adjust benefits correctly.

Even if the information is collected, some field offices lack standard procedures for ensuring that information about the work activity is shared between programs. Some field offices have established local procedures for sharing this information, but these procedures may not always be adequate. For example, in one field office we visited, the SSI specialists who usually collected information about work activity from concurrent beneficiaries would copy and share the information with one designated supervisor who was responsible for taking the actions necessary to adjust DI benefits. Even with this procedure in place, the supervisor told us she was not confident that she was receiving all the information that was being reported by concurrent beneficiaries.

SSA Does Not Monitor Its Process for Accounting for Work Activity, Often Resulting in Untimely Actions That May Cause Overpayments

SSA’s procedures for determining the appropriate DI benefit amount when concurrent beneficiaries work make it difficult to adjust benefits in a timely manner. When a concurrent beneficiary reports work, the field office handling the case can adjust the SSI benefit, when warranted. In contrast, in most cases, field office employees cannot take immediate actions to adjust DI benefits because they cannot be adjusted until the beneficiary has completed a 9 month trial work period. At the beginning of the trial work period, SSA procedures direct the field office to transfer DI cases to one of seven program service centers (PSC) for documenting the start of this period. At the end of this period, the PSC is supposed to return the case to the field office, which then determines whether the beneficiary will continue to be entitled to benefits. However, SSA does not routinely monitor or have a comprehensive system that tracks actions on cases as they move between SSA components and automatically identifies the cases may be nearing the completion of the trial work period. As a result, the field offices may not be notified immediately upon the completion of a trial work period and, therefore, may not know whether or not to terminate DI benefits. Employees in several field offices told us that they often do not receive the cases back from the PSCs in a timely manner. Their estimates of the time it took the PSC to return these cases for further action ranged from 1 to 10 years. SSA officials could not verify these delays because they told us that they did not systematically collect information about these time frames. These problems occur not only when administering the trial work period for concurrent beneficiaries, but for all DI beneficiaries who return to work.

Untimely actions may also occur because the tasks related to adjusting benefits after the end of the trial work period are given a lower priority than other workloads. Several SSA officials told us that many tasks associated with adjusting benefits to account for work activity do not receive workload credits that help maintain or increase field office staffing levels. For this reason, field office managers generally give a higher priority to tasks that do, such as processing initial claims for benefits. However, an SSA headquarters official recently told us that SSA will focus greater attention on the post trial work period workload as it implements the Ticket to Work program.

Because SSA employees do not always evaluate and take action related to the work activity in a timely manner, some DI beneficiaries continue to receive benefits that they are no longer due. When DI beneficiaries earn more than a specified amount in any month after completing the trial work period, as of that month, SSA no longer considers the person disabled and should end their DI benefits 2 months later. However, several SSA officials told us about a one-time analysis of SSA disability overpayments based on cessation of disability in calendar year 2000 that revealed that about one-half of the overpayment dollars were made to people who should not have received benefits because of their earnings. Given this analysis, failure to take timely actions when DI beneficiaries work may account for about $350 million dollars in overpayments for calendar year 2001.

SSA established a temporary new position in July 2000, the employment support representative, which has the potential to address the challenges it faces in serving concurrent beneficiaries. SSA developed the position, in part, to concentrate on the needs of disability beneficiaries who work and tested it with 32 SSA employees who had responsibility for 54 field offices. These representatives received extensive training in the work incentive provisions of both the DI and SSI programs. This training prepared them to take the necessary actions for both programs without the need to rely on unfamiliar program guidance. Moreover, funneling all work activity cases through a single employee would allow this individual to develop a level of expertise that was not possible in the traditional field structure. Further, combining all duties related to disability beneficiaries who return to work into a single position could eliminate the problem of specialists in one program failing to share information with the other program. In addition, since these representatives do not share responsibility for handling the case with the PSC, they could take actions to adjust DI benefits in a timelier manner.

It is unclear whether SSA will make this position permanent, and to what degree. In a November 2001 report, an SSA workgroup recommended that the position be implemented permanently in as many of its 1,300 service locations as feasible. While the 32 employment support representatives continue to perform the duties of this position, the agency has not announced decisions about the ultimate fate of this position. As of July 2002, SSA officials were still evaluating the resource implications of implementing this position in most of its field offices. Without additional resources, some field office managers told us they would have to divert existing staff from their current positions to assume the employment support representative role. SSA has not evaluated the timeliness of actions taken by the employment support representatives to adjust benefits. However, the employment support representatives with whom we spoke thought that the additional costs associated with the new position could be offset by the reduction in overpaid DI benefits from their more timely actions.

In addition to testing the employment support representative position, SSA is developing a new computer system that may potentially help to improve the timeliness of actions in response to the work activity of DI beneficiaries. Scheduled for release at the end of calendar year 2002, the new program will allow SSA for the first time, to collect information about the monthly earnings of all DI beneficiaries who are working. This information should provide the basis for a systematic method for SSA to determine whether additional action is needed to determine continuing eligibility for of DI benefits. However, SSA is still deciding what additional information the new system should include and what reports it should produce to monitor all the actions needed to account for the work activity of DI beneficiaries and to adjust benefits in a timely way.

The Application of Both DI and SSI Rules Makes It Difficult for Concurrent Beneficiaries to Make Informed Decisions about Work Activity

Just as SSA has no special procedures for administering the rules for concurrent beneficiaries, it does not provide concurrent beneficiaries with any integrated explanation of the effects of work on both DI and SSI benefits through its public information materials. The numerous publications that SSA has issued explain how work affects one benefit or the other. SSA extends this practice of not integrating their explanations of the effects on benefits by sending beneficiaries two separate letters, one to explain changes in DI benefits and another to explain SSI benefits. In addition, SSA field office specialist employees that lack expertise about both programs may provide incomplete or incorrect information about these effects.

While it may be difficult to communicate, it is important for concurrent beneficiaries to understand that work activity affects their benefits at different levels of earnings and at different times, depending on the program. For example, concurrent beneficiaries with relatively low earnings may be able to maintain both benefits while increasing their total income. However, as earnings increase, so does the probability that they will eventually lose one or both benefits. Figure 2 illustrates these effects of work activity at three earnings levels on the DI and SSI benefits. At low earnings, a beneficiary receiving the average DI benefit who starts working in February 2002 retains DI and SSI benefits throughout the 13 month period shown. In contrast, a beneficiary with high earnings—higher than substantial gainful activity—will lose both benefits during the same period.

Because the work incentive provisions of the two programs are designed to encourage beneficiaries to test their ability to work without losing their benefits, concurrent beneficiaries who understand the rules of both programs can make decisions that best support their priorities for income, services, and self-sufficiency. Concurrent beneficiaries who wished to become self-sufficient would need to understand that, to maintain an equivalent of their level of benefits and services, they would need to earn enough to make up for the eventual loss of cash benefits and health insurance and benefits and services from other sources. Concurrent beneficiaries who are uncertain about their ability to sustain work can focus on working at a level that preserves enough benefits to support them while they test their ability to work. In determining what level of work they can pursue, these beneficiaries would have to weigh the value of non cash benefits that depend on income and assets such as housing or social services compared with the earnings from increased work activity. For example, a service provider told us about one concurrent beneficiary who was receiving in-home support services from his county that allowed him to live independently. However, he returned to work and was then earning too much to continue to qualify for these services. He determined that he could continue to qualify for the support services by working 1 hour less per week and he negotiated the change with his employer.

Concurrent beneficiaries who do not understand the programs’ provisions may make decisions about work that will make them worse off financially. Some concurrent beneficiaries do not work at all because they are afraid of losing their benefits. For example, two social service providers with whom we spoke indicated that some of their clients with mental retardation and the family members who helped them make decisions would avoid any work activity. Even though some earnings would not significantly affect benefits, they feared the loss of any benefit and health insurance and decided to forego the additional income they could have earned. At the other extreme, beneficiaries may inadvertently lose the benefits and health insurance they need by earning more than the allowable limits under one or both of the programs.

Concurrent beneficiaries who do not understand the full range of work incentives may not pursue provisions that might ease their transitions to work. For example, one young concurrent beneficiary who was working part-time and attending college told us that SSA employees had never explained two SSI work incentive provisions that would have allowed her to exclude more of her earned income from the total used to determine her benefit. This would have allowed her to have more money for her tuition. Another concurrent beneficiary said that, even though she had expressed a strong desire to work and had returned to work for a short time, SSA had never explained that she could deduct from her countable earnings the cost of any items or services related to her impairments that were necessary for her to continue working.

To assist beneficiaries in making better decisions about work activity, as authorized by the Ticket to Work and Work Incentives Improvement Act of 1999, SSA has provided funding since 2000 to community-based organizations. These organizations are funded to provide work incentives planning and assistance to beneficiaries and conduct outreach to individuals who are potentially eligible to participate in work incentive programs. In fiscal year 2002, SSA awarded a total of about $20 million to more than 100 organizations for these activities. The 2001 annual report of this program indicates that, through the end of that calendar year, more than 100 organizations receiving funding provided intensive benefit support services to more than 4,500 beneficiaries, most of whom were working or considering a return to work. In addition, more than 5,000 beneficiaries received less intensive services, such as information and referral.

Some disability advocates have recommended making the work incentive rules similar in both the DI and SSI programs to help beneficiaries better understand the effect of work on benefits. They frequently suggest eliminating the 9 month trial work period for DI and replacing it with a gradual reduction in benefits in response to increased earnings, similar to the SSI program. Such a change would require legislative action. The Ticket to Work and Work Incentives Improvement Act requires SSA to conduct a demonstration project to test whether a reduction of $1 in DI benefits for every $2 earned would remove disincentives to return to work. SSA is still in the planning stages for this demonstration, and it is unclear when data will be available.

Conclusions

The DI and SSI programs were designed as two separate programs to serve two distinct categories of disability beneficiaries. However, a third category, concurrent beneficiaries—those who qualify for both DI and SSI benefits–has emerged as a sizable disability population. Failure to properly administer the program for this special population could result in benefit overpayments and underpayments and less-than-ideal beneficiary decisions about work.

Without taking additional steps, it will be more difficult for SSA to effectively administer the disability program and serve concurrent beneficiaries under the current program. Without improved guidance and procedures, staff that have knowledge only about SSI or DI program rules may not collect and share information needed to make accurate determinations about concurrent beneficiaries’ benefit payments. In addition, without a monitoring system to ensure information about concurrent beneficiaries’ work activity is shared across program components and acted upon within a timely manner, SSA faces an increased risk that concurrent beneficiaries, as well as all DI beneficiaries who return to work, will be overpaid. Moreover, without public information materials that clearly explain the complex interaction of the two programs, the possibility that beneficiaries would make decisions about working that are not in their best interest could increase. Further, a lack of understanding of the work incentive provisions could create a disincentive to work.

Recommendations for Executive Action

SSA needs to undertake the necessary steps to ensure it adequately serves concurrent beneficiaries and exercises its stewardship over program funds by avoiding overpayments. We recommend that the Commissioner of SSA: Develop procedures and integrated guidance to ensure information about work activity is collected and shared between the DI and SSI programs. One option would be to improve the cross-references used in its program guidance to more specifically target needed information to take actions to adjust benefits for both programs. Another option would be to require that some staff are knowledgeable about both programs and that they collect and act on work activity information for both programs. Regardless of the option selected, SSA should also consider adding to its guidance explanations and examples of the effect of work activity for individuals receiving both DI and SSI benefits.

Develop comprehensive systems to monitor the progress of DI cases as they move between SSA components and set timeliness goals for the entire process for each action and component. In addition, use this information to help ensure timely actions and minimize overpayments of DI benefits when individuals return to work.

Develop public information materials targeted to concurrent beneficiaries that explain the complex interaction of the two programs in language that beneficiaries can understand. SSA may wish to consider revising its publication, Working While Disabled—How We Can Help, to include a basic explanation of the effects of work when an individual receives both DI and SSI benefits and examples that illustrate these effects. For more detailed explanations, SSA could direct beneficiaries to contact an SSA representative knowledgeable of both programs.

Agency Comments and Our Evaluation

In its comments on a draft of this report, SSA agreed with our conclusions and highlighted the initiatives it has underway or planned that it believes will address our recommendations (see app. II). Concerning our first recommendation, SSA stated that it is developing training for fall 2002 to enhance field office employees’ technical proficiency in both the DI and SSI programs. It is also developing and refining its supportive software systems to print referral forms for use in routing program information. We believe additional training should help to improve the technical proficiency of field office employees in both programs. However, SSA may need to consider the time field employees will need to develop proficiency after completing the training. Reliable, user-friendly program guidance could help reinforce this training as well as be a reference to these and future employees. Therefore, we continue to believe that program guidance should be modified to more completely explain the interactions of the two programs when concurrent beneficiaries work. Further, while the enhancements to software should provide SSA with an additional tool for sharing information between programs, SSA may wish to consider developing procedures to ensure that such available tools are being used appropriately to share information.

Concerning our second recommendation, SSA said that the systems it now has under development and scheduled for release in November 2002 will provide the necessary management information capabilities needed to ensure actions related to beneficiaries working are taken on a timely basis. As acknowledged in our report, the new system under development has the potential for improving the timeliness of actions in concurrent cases. However, because the system is still under development, we are unable to determine how effective it will be in identifying and controlling work activity. For example, we cannot confirm at this time whether the databases being developed will contain information about all working beneficiaries nationwide that can be accessed by all field offices or local databases that can only be accessed by the employees in one office, similar to those being tested in a number of field offices.

Concerning our third recommendation, SSA stated that it would develop a fact sheet for concurrent beneficiaries that explains the interaction of the two programs in language they can understand. The agency will also modify another publication to make it clear that beneficiaries should contact the agency for an explanation because the interaction of work activity with the two programs is so complex that it requires individualized explanations. We believe a fact sheet that explains the interactions of the DI and SSI programs should be useful for concurrent beneficiaries. In addition, we agree that the interaction of work with DI and SSI benefits is complex and that individualized explanations may provide concurrent beneficiaries with the most complete information. In relying on individualized explanations provided by SSA employees, SSA may wish to consider developing methods to ensure that concurrent beneficiaries have access to employees who are knowledgeable in both programs regardless of the method of contact. For example, given that many beneficiaries may contact SSA through its 800 number teleservice centers, SSA could either deploy knowledgeable staff in the teleservice centers or establish procedures to ensure that these calls are referred to staff who are knowledgeable in both programs.

SSA also provided technical comments, which we have incorporated as appropriate.

We are sending copies of this report to the Commissioner of Social Security, appropriate congressional committees, and other interested parties. We will also make copies available to others on request. In addition, the report will be available at no charge on the GAO Web site at http://www.gao.gov.

If you or your staff have any questions about this report, please contact me on (202) 512-7215 or Shelia Drake at (202) 512-7172. Key contributors to this report were Beverly Crawford, Amy Bevan, Patrick DiBattista, and Vanessa Taylor.

Appendix I: Scope and Methodology

To determine the number and characteristics of concurrent beneficiaries, we used data from the Social Security Administration’s (SSA) monthly 10 Percent Characteristic Extract Record file of the Supplemental Security Record, which contains data from a 10 percent simple random sample of the records of all Supplemental Security Income (SSI) applicants and beneficiaries. We used data from the September 2001 extract to test our analysis and used the February 2002 extract for the final analysis.

We first determined the number of working age beneficiaries (both concurrent and SSI only). To do this, we deleted from the sample universe all records that were not active (those that did not have a Record Identification Code of G); showed a date of death in a month prior to the month of the file; showed a master file type other than disabled or blind; showed that the beneficiary was under age 18 or over age 64 as of the month of the file; showed that the claim was denied and no payments had been made on that record; showed entitlement for a veteran under title VIII of the Social Security Act; and showed that the beneficiary was not receiving SSI because of excess income, except for those beneficiaries who continued to be eligible for Medicaid under section 1619b of the Social Security Act and who would be eligible for SSI payments if it were not for their earnings.

We then determined which beneficiaries received Disability Insurance (DI) income as well as SSI income—concurrent beneficiaries. To do this, for the records that remained, we identified concurrent beneficiaries as individuals who were currently receiving type A unearned income. Type A unearned income is any Social Security benefit. The remaining records were identified as beneficiaries who received SSI but not DI. We did not eliminate the remaining records for which benefits were suspended, but were not terminated as of February 2002, because, in many cases, these suspensions are temporary and the beneficiary will return to payment status within a relatively short period of time. In addition, our methodology did not allow us to discern whether concurrent beneficiaries ages 62 through 64 were receiving Social Security benefits on the basis of disability or retirement. As a result, we may be slightly overstating the size of the concurrent beneficiary population.

All estimates have sampling errors of +/- 5 percent or less of the value of the point estimates offered. We employed standard and widely accepted social science and statistical methods. We did not independently verify the accuracy or completeness of the data provided to us by the SSA.

To assess the extent to which SSA coordinates the DI and SSI program rules when individuals are working and receiving benefits from both programs, we reviewed the relevant sections of the Social Security Act, regulations, and SSA policy and procedural guidance to its employees. We also interviewed SSA officials at the headquarters in Baltimore, Maryland, and at several field offices. We visited two SSA field offices each in metropolitan Los Angeles, California; and Chicago, Illinois, and one each in Alexandria, Virginia; Wilmington, Delaware; and Towson, Maryland. We judgmentally selected the locations on the basis of geographic diversity, the presence or absence of an employment support representative pilot, and the use of generalist or specialist claims representatives.

To determine the potential effect of applying both DI and SSI program rules on concurrent beneficiaries’ decisions to work and on their benefits, we relied on our review of SSA law, regulations, and policy and procedural guidance as well as our interviews with SSA officials at headquarters and in field offices. We also reviewed the public information materials that SSA developed and used to communicate information about its programs to beneficiaries and other interested parties. In addition, we interviewed academic researchers, advocates for people with disabilities, social service providers for individuals with disabilities, and a small number of concurrent beneficiaries.

Appendix II: Comments from the Social Security Administration