How Underfunding Social Security's Administrative Budget Costs Money -- Lots Of Money

From a recent report by Social Security's Office of Inspector General (OIG) (emphasis added):

The objective of this evaluation was to determine the financial impact to the Disability Insurance (DI) and Supplemental Security Income (SSI) programs as a result of conducting fewer full medical continuing disability reviews (CDR). ...

SSA employs a profiling system that uses data from SSA’s records to determine the likelihood of medical improvement for disabled beneficiaries. SSA selects beneficiaries’ records profiled as having a high likelihood of medical improvement for a full medical review by disability determination services (DDS). Beneficiaries profiled as having a medium or low likelihood of medical improvement are sent a mailer questionnaire. If the completed mailer questionnaire indicates medical improvement, SSA will send the case to the DDS for a full medical review. ...

According to SSA, resource limitations and increases in its core workloads prevented it from conducting full medical CDRs when they became due. As a result, SSA estimates a backlog of over 1.5 million full medical CDRs will exist at the end of Fiscal Year (FY) 2010.

SSA has made, and will continue to make, benefit payments to individuals who would no longer be eligible if the backlog of 1.5 million full medical CDRs had been conducted when they became due.

• From Calendar Year (CY) 2005 through CY 2010, we estimate SSA will have made benefit payments of between $1.3 and $2.6 billion that could have potentially been avoided if the full medical CDRs in the backlog had been conducted when they became due (see Appendix C).

• Although SSA plans to conduct an increased number of full medical CDRs in FY 2011, the 1.5-million full medical CDR backlog will most likely remain. Therefore, we estimate SSA will pay between $556 million and $1.1 billion during CY 2011 that could have potentially been avoided if the full medical CDRs in the backlog had been conducted when they became due (see Appendix C). ...

We estimate SSA could potentially identify lifetime Federal benefit savings of almost $15.8 billion if it had the resources to conduct all 1.5 million full medical CDRs in FY 2010.

Budget planners, take notice.

Why was it that OIG was not producing reports like this while George W. Bush was President? What we saw then was reports that implied that incompetent bureaucrats were allowing crooks to rip off Social Security.

Hearing Scheduled On Social Security Appropriation

The House Appropriations Committee's Labor-HHS Subcommittee has scheduled a hearing for Wednesday, April 14 at 10:00 on Social Security's administrative appropriation for fiscal year 2011, which begins on October 1, 2010. This is not an appropriation for the benefits paid by Social Security -- those require no appropriation -- but for the budget, or limitation on administrative expenditures (LAE) if you want to be technical, which Social Security needs to administer those benefits. Social Security Commissioner Michael Astrue is scheduled to testify.

Fee Payment Stats

Social Security has released updated numbers on payments of fees to attorneys and others for representing Social Security claimants.

Fee Payments
Month/Year	Volume	Amount
Jan-10	32,227	$111,440,046.23
Feb-10	29,914	$105,708,101.59
Mar-10	34,983	$122,874,426.87

Statisticians Get Recognition

Amstatnews, the membership magazine of the American Statistical Association is running an article by William W. Davis, Social Security's Chief Mathematical Statistician, describing the work of the agency's Office of Research, Evaluation and Statistics (ORES). One key project for ORES at the moment is the plan to issue Social Security numbers randomly across the country instead of assigning the first three digits of the number geographically.

Field Offices, Your Time Has Come

The House Social Security Subcommittee has scheduled its first hearing since Congressman Earl Pomeroy became chairman. The hearing will be on April 15 at 10:00. Here are some excerpts from the press release:

So far this calendar year,weekly visits to SSA’s field offices have hit the one million mark five times, while in all of last year, visits hit the one-million mark only twice. The Government Accountability Office and others have concluded that resource shortages over the years have contributed to the development of unprecedented backlogs in disability hearings, and caused reduced staffing throughout the agency even as workloads have risen. By the end of 2007, agency staffing had dropped to almost the level in 1972 – before the start of the SSI program – even though SSA’s beneficiary population had nearly doubled since that time. This in turn has led to a decline in customer service and a buildup of unprocessed workloads in SSA local field offices.

In FY 2008 through FY 2010, Congress provided SSA with increased funding to begin to address the backlogs and other service delivery declines. These increased resources reflect Congressional concerns about the unacceptable backlog in disability claim processing, but have not been sufficient to address the growing amount of work that SSA has been forced to defer in order to process the increasing number of new claims on a timely basis.

Despite the hard work and dedication of SSA employees in field offices and teleservice centers, SSA’s level of service to the public has deteriorated. Field office managers report that they do not have sufficient staff to answer the phones, assist walk-in visitors, and produce the high-quality work the public deserves. In FY 2009, 58 percent of callers who tried to reach an SSA field office got a busy signal, up from 51 percent in FY 2008. As a result, more walk-in visits occur for matters that could be handled by phone. Field office managers and front-line staff also are increasingly concerned about declining quality in the work they produce. Nearly all resources are needed to process claims and assist SSA’s customers, and little is left to perform traditional quality-control and staff-training activities. ...

In announcing the hearing, Chairman Earl Pomeroy (D-ND) stated “the Social Security Administration (SSA) was right to prioritize reducing the disability claims backlog, but I am concerned that other services that SSA provides to the American people are not getting sufficient attention and resources. I am interested in knowing what steps SSA is taking to address these other growing and backlogged workloads, and how the Subcommittee can be instrumental in making sure that SSA is once again able to provide the top-notch customer service the public deserves.”

This helps explain the April 6 announcement of additional personnel for Social Security field offices.

Nice Try

From Investors Business Daily:

Come 2018, even Social Security's staunchest defenders will have no choice but to admit that the program faces an urgent crisis.

That's when Social Security's Disability Insurance Trust Fund is due to run out, resulting in benefit cuts for disabled workers and their families.

And those cuts would be sharp — roughly 8% in 2018 and 16% in 2019 relative to scheduled levels. ...

[E]ven if the OASI [Old Age and Survivors Insurance] trust fund is still officially flush, it won't be able to automatically shift its Treasury-issued debt to the disability program.

Just one problem with this: Congress has previously allowed interfund borrowing and will undoubtedly do so again. The article mentions that this has happened in the past but assumes that it will not happen in the future. That is a ridiculous assumption. For all practical purposes, the two trust funds are one. There is a long term funding problem for Social Security in general. I wish we would get on to addressing it. The disability trust fund is not going to be the trigger for this to happen.

It Takes Longer In Ohio

From the Dayton Daily News:

Ohio residents seeking Social Security Disability Insurance wait longer for a hearing than residents of any other state, says a study released Tuesday, April 6.

More than 19 months on average pass before disability claims are heard by administrative law judges who determine eligibility for benefits, said Allsup, an Illinois company that processes Social Security disability claims.

For more on this, see a Government Executive article.

Open Government

In response to a Presidential initiative, Social Security has posted an Open Government page online. I see nothing new completely here but it is a useful compilation of resources made available by the agency.

Do note how agency expenditures as a percentage of the Social Security trust funds have declined dramatically over the decades.

What The Managers Think

The National Council of Social Security Management Associations (NCSSMA), an organization of Social Security management personnel, surveys its membership each year, asking about their experiences in managing Social Security field offices. Here is their summary of this year's survey:

• QUALITY OF WORK
• 87.4% of Survey respondents reported that they receive complaints weekly from the public about the accuracy or timeliness of the work being produced.
• 82.5% of managers report that the number of quality case reviews performed in their office is insufficient to ensure an accurate and timely work product.
• 71.9% of managers considered inadequate staffing to be the first or second greatest obstacle to ensuring a timely and accurate work product from their office. 61% said that competing operational priorities was the first or second greatest obstacle.

• FIELD OFFICE TELEPHONE SERVICE
• 64.6% of Field Office managers said that their offices were able to provide prompt telephone service less than half of the time.
• Virtually all of the managers (98.1%) receive weekly complaints about telephone service provided by their office. 72.8% said they receive up to four such complaints each week.
• 67.8% of the respondents said that the increased volume of visitors walking into their office is due in moderate or very large part to the inability of their office to provide prompt telephone service. 36.5% attribute the increased walk-in traffic in large part to the limited ability to answer the phones. The cause and effect is clear. 71.7% of managers said that they frequently or very frequently reassign staff from handling phone calls to helping in the reception area to reduce waiting times.
• Field Office managers overwhelmingly (88.7%) said that more staff was the most necessary element to improve telephone service in their office. Only 5.2% said that better telephone equipment was the single greatest need.

• STAFFING
• As in recent Surveys, the need for additional staff is the most significant concern for Field Office managers. 95.5% of the managers said that they need to hire at least one more employee to provide adequate public service; 89.2% said that they need to hire at least two more employees; and 71.2% said that they need to hire at least three more employees.
• Despite 1:1 staff replacements as a result of the FY 2010 SSA budget, 42% of the respondents indicated that they were not given authority to hire in FY 2010.

An E-Mail From The Commissioner

From: Commissioner Broadcast
Sent: Tuesday, April 06, 2010 6:07 PM
Subject: COMMISSIONER'S BROADCAST--04/06/10

To All SSA And DDS Employees

Subject: New Hires

I know that our unprecedented workloads continue to pressure every part of the agency. To help ease this pressure, we have been replacing staffing losses across the agency and hiring a substantial number of employees in the DDSs and ODAR. We have recently reassessed resources, and today I approved 900 new hires for front-line positions in Operations; virtually all of this allocation is for field offices. Moreover, I have decided to provide many of the additional hires to the most stressed offices. To the extent that space allows, we will be adding an average of 3 hires to the 200 field offices we found to be the most short-handed.

We can take this step forward because we have honored our commitment to Congress and the American public to make disability backlog reduction our top priority. We have 25 new hearing offices coming on line, and ODAR has reduced the number of pending cases for 15 straight months. Average processing times, particularly for the most backlogged offices, are dropping steadily.

In the face of furloughs and a deep recession, the DDSs have kept the number of pending cases well below our original projections so far this year.

Thank you for all you are doing in hard times to keep serving the American public.

Michael J. Astrue

Commissioner