The SSI program is administered by SSA. Claims representatives at SSA field offices are responsible for processing all applications and determining the amount of monthly SSI payments. SSI is a program based on need. The maximum monthly SSI benefit in 1996 was $470. Clients receive less than the maximum or become ineligible for the program altogether if their earned and unearned income and resources exceed certain thresholds. Monthly changes in the amount of non-SSI income that clients receive increase or decrease the amount of SSI benefits to which they are entitled. If clients do not report these income fluctuations promptly to SSA, an overpayment or underpayment will accrue. SSI clients are required to self-report any income that they receive to claims representatives when applying for SSI and are also required to self-report any changes in their monthly income by the 10th day of the following month. SSA policy requires that claims representatives verify this reported income, but does not require that claims representatives check for unreported income unless they suspect that clients are not reporting all their income during initial or subsequent eligibility determinations. SSA uses both financial eligibility reviews, known as redeterminations, and computer matching to identify and prevent overpayments. During redeterminations, clients report their income on mailed questionnaires or during face-to-face or telephone interviews. The method used to contact the client and the frequency of such contacts depend on the likelihood that a client’s financial situation will change. Computer matches detect some types of income that clients have not reported. They consist of comparing the SSI payment records against client information contained in the payment files of other government agencies. In order to detect unreported income, the earnings and unemployment insurance (UI) benefits reported by SSI clients are compared or matched, for example, against earnings and UI information that employers report to state agencies. However, no computer matches are done that could identify unreported or underreported income from the Aid to Families With Dependent Children (AFDC) and workers’ compensation (WC) programs. In 1994, SSA began establishing on-line connections between its field offices and state agencies that had automated databases that could easily be linked to SSA’s computer system. SSA did this so that information on earnings and AFDC and UI benefits contained in these databases could be automatically obtained as soon as claims representatives requested it. Claims representatives use such information for a variety of purposes, including verifying the amount of income that clients report when applying for SSI and during redeterminations of their continuing financial eligibility. On-line access began in a limited number of SSA field offices in Nashville, Tennessee, in July 1994. Currently, claims representatives at all 30 Tennessee field offices are able to access state data on earnings, UI, and AFDC for any client using the computers on their desks. In addition, at the time of this report, on-line access to WC information was also being negotiated in Tennessee. This access takes only a minute or two to retrieve the pertinent data. As of mid-1996, on-line access to state wage, UI, and AFDC data was also fully implemented in SSA field offices in North Carolina, South Carolina, and Kentucky, and partially implemented in SSA field offices in 2 other states. Initial contacts or negotiations for on-line access were also being conducted in 11 other states. SSA estimates that in Tennessee, on-line access saves at least $6.50 in administrative costs every time a claims representative obtains data on-line, which occurs thousands of times each month. SSA further estimates that having such access results in clients receiving their first benefit check at least 1 week earlier. These improvements occur because in processing an initial claim and in conducting redeterminations, claims representatives no longer have to telephone, write, fax, or sometimes even visit state agencies to obtain necessary documentation—they simply obtain the information on their computers. Claims representatives use on-line access for a variety of purposes, including verifying the amount of AFDC or other benefit income a client reports receiving. According to SSA, in one field office, SSA staff found that on-line access saves 30 to 45 minutes of a claim representative’s time per claim. In another field office, a claims representative told us that she was able to obtain needed AFDC information on-line for a co-worker in a field office in another state who had been waiting for 6 weeks to get this information through conventional channels. Another way that claims representatives use on-line access is to follow up on computer-matching results indicating that clients may not have reported all their earnings or UI benefits. This entails contacting the recipient and often an employer or government agency to confirm the receipt of earnings or benefits. One claims representative told us, for example, that she uses on-line access to obtain more up-to-date addresses on the clients she is investigating and that without such information it has taken her up to 2 months to find correct addresses. Other claims representatives told us that they routinely check earnings on-line when investigating computer-matching results because the on-line access can provide more current earnings information and identify additional employers who are not listed on SSA’s computer matches with their own earnings data or state data. A final way that claims representatives use on-line access is to obtain miscellaneous personal information, such as the Social Security numbers and birthdays of members of a client’s household, as well as the types of public assistance household members receive. Because this type of information is frequently available on-line from the states, claims representatives no longer have to delay claims processing while clients search for this information. SSA believes that the benefits of on-line access have been sufficiently demonstrated in field offices in the six states where it has been fully or partially implemented to warrant expanding it to other states. These benefits, which we observed during our field office visits, include reducing the amount of time and paperwork required for income verification as well as the amount of time required for claims processing. At the time of our work, SSA was developing a long-range plan to expand on-line access nationwide, which included developing benchmarks to better measure the amount of time and money such access will save. SSA was also actively pursuing such expansion in field offices in at least 11 additional states. In addition to expanding on-line access to other states, however, SSA could also use it to improve the accuracy of its payments. Our analysis of SSA overpayment data shows that an estimated $131.3 million in overpayments nationwide occurred between June 1993 and May 1994 because some SSI clients did not report or underreported income they received. More than $34 million of these overpayments resulted from unreported or underreported AFDC, UI, and WC benefit income, and more than $97 million resulted from unreported or underreported earned income. If SSA field offices nationwide had used on-line access to state databases, SSI program dollars could have been saved because the overpayments might have been prevented or more quickly detected. Preventing overpayments saves program dollars for two reasons: overpayments would never be made and SSA would not have to spend additional money trying to recover them. Detecting overpayments sooner also saves program dollars because, according to SSA officials, the sooner overpayments are detected, the more likely it is that they will be recovered. Of the $34.1 million in overpayments related to AFDC, UI, and WC income, about 89 percent ($30.5 million) occurred because both newly eligible and ongoing clients did not report to the claims representatives handling their cases that they were receiving state-administered benefits. The remaining 11 percent ($3.6 million) resulted when newly eligible and ongoing clients who had reported receiving benefits did not report increases in the amount of their benefits or did so only after they had received their SSI check covering the period during which the increase occurred. (See table 1.) The $30.5 million in overpayments resulting from unreported AFDC, UI, and WC benefits shown in table 1 might have been prevented if claims representatives had used on-line access to state information on these benefits. State welfare and employment departments maintain such information and, according to officials we spoke with, generally update it at least monthly. Through an on-line connection to these data, SSA could easily check to see if SSI clients were receiving these benefits before becoming eligible for SSI or whether clients were receiving these benefits and SSI simultaneously. Alternatively, programming could be put in place that would automatically compare SSA records to relevant state earnings and benefit data and generate lists of discrepancies that were found. Verification would make it less likely that such income would be undetected. On-line access would not have prevented all of the $3.6 million in overpayments resulting from underreported AFDC, UI, and WC from occurring, but might have detected the overpayments sooner. Moreover, had they been discovered sooner, the amount overpaid would have been less. These overpayments resulted because clients either did not self-report increases in their income to claims representatives or did so only after receiving their SSI checks. On-line access might not have prevented these overpayments from occurring because the benefit income that caused these overpayments would have to have been paid in order for this income to be reflected in the databases that claims representatives access on-line. On-line access might have detected these overpayments sooner than they would otherwise have been detected, however, because such access allows SSA to verify the amount of these benefits as soon as the benefit amount is updated at the relevant state agency, which occurs once a month or more frequently. The primary ways SSA currently detects SSI overpayments are through client self-reporting; miscellaneous tips from third parties; or, in the case of the UI program only, computer matching.