The objective of this audit was to identify vulnerabilities
in the disability determination process that subject the Supplemental
Security Income (SSI) Disability Program to abuse.
BACKGROUND
A Georgia family became the subject of the joint review initiated
after the Georgia Disability Determination Service (DDS) notified
the Social Security Administration (SSA) Region IV personnel of
its concern that the family`s SSI recipients may have been
coached to malinger during consultative examinations (CE). SSA,
the Office of the Inspector General (OIG) , and the Georgia
DDS formed a team to evaluate the alleged irregularities. The team
initially identified about 300 family members comprising
4 generations of the extended Georgia family, including 181 SSI
recipients. The team selected 151 SSI recipients under age 55 for
continuing disability reviews (CDR), to begin in the summer of
1995. As of March 1996, SSA had discontinued benefits to 84 family
members based on completed CDRs. As of March 1997, about 500 Georgia
family members had been identified by the Georgia DDS.
RESULTS OF REVIEW
We analyzed 66 discontinued cases. The majority of benefit
cessations,
58, resulted from medical improvement. Seven resulted from
lack of cooperation and one from gainful employment. Forty-four
of the discontinued cases reviewed were children. Two of the seven
uncooperative claimants had each been denied benefits 14 times.
Psychological evaluation reports concluded 24 recipients
(14 adults and 10 children) had malingered during the CDRs.
The 66 recipients received $1.06 million in SSI disability benefits
through June 1995, including over $431,000 in benefits to the 24
malingerers.
The DDS frequently used a local psychologist with offices in
Statesboro and Vidalia, Georgia for the initial determinations,
although the CDRs showed a number of treating physicians and psychologists.
The local psychologist participated in
initial CEs for 38 of the 66 discontinued cases, or about 58
percent, and 13 of the 24 malingering cases, or 54 percent. Four outof
seven claimants who refused to cooperate in obtaining medical evidence
during the CDR process had initial CEs with this psychologist.
SSI benefits of $672,000 were paid to recipients with CEs from
this provider. The DDS removed this CE provider from the list of
CE panelists but did not notify SSA. The DDSs were not required
to notify SSA.
An investigation was conducted of the Georgia cases in consultation
with the United States (U.S.) Attorney`s office. Since the
Government could not prove that recipients were not disabled at
the time they applied for benefits, the cases resulting from the
investigation were declined for prosecution.
GROWTH OF SSI
SSA published historical data that shows SSI beneficiaries,
disabled at birth or during childhood are likely to remain on the
rolls for long periods of time. The average duration of pre-retirement
age SSI benefits for the period 1975-1993 increased over 60 percent,
from 11 years to nearly 18 years. These changes, due to the earlier
age of awardees and increased incidence of mental impairment diagnoses,
are evident in the significant growth in the number of children
receiving SSI after 1989, from 296,000 in December 1989, to 974,000
in December 1995.
The preponderance of mental disabilities alleged in the Georgia
family, showed that 53 percent of claims reviewed related to mental
retardation, 33 percent physical and emotional disorders, and 14
percent attention deficit/hyperactivity disorders.
NEW LEGISLATION
Recent legislative changes will affect SSAs administration
of the SSI Disability Program. The Personal Responsibility and
Work Opportunity Reconciliation (PRWOR) Act of 1996, Public Law
104-193, requires SSA to conduct CDRs on childhood SSI recipients
at least once every 3 years. SSA can use the results of the Georgia
family reviews when conducting CDRs on similar cases in the future.
The PRWOR Act of 1996, Public Law 104-193, section 211, also
eliminates the comparable severity standard and the maladaptive
behavior criteria from personal and behavioral functioning for
children`s disabilities. The legislation directs SSA to discontinue
the use of individualized functional assessments (IFA) in evaluating
childrens disabilities and requires SSA to redetermine the
eligibility of SSI recipients enrolled under the eliminated provisions
no later than 1 year after enactment of the law.
SAVINGS
We estimate that savings of Federal funds of approximately
$2.1 million in SSI and Medicaid benefits could be realized based
on the 66 initial cessations of benefits as of February 1996, plus
24 supplemental cessations to the Georgia family since that date,
for a total of 90 cessations as of March 1997. The estimated range
of savings was $1.7 million to $2.5 million. Estimates were based
on actuarial projections provided by SSAs Office of the Chief
Actuary, using data from our review.
The actuary qualified the estimates, since characteristics
of a selected group such as the extended Georgia family may differ
significantly from the general population of SSI recipients selected
for periodic reviews.
RECOMMENDATIONS
We have made a total of 25 recommendations, suggestions,
and observations to improve the efficiency and effectiveness of
the SSI program, including the following:
Three joint review recommendations address the need for
educational coordinator positions, updated training for all DDS
personnel, and modification to the Supplemental Security Income
Display (SSID) to alert subsequent users of potential fraud/abuse.
Eight OIG, Office of Audit (OA) recommendations focus on
the need for additional reviews of extended family members, more
emphasis on rotating CE providers where possible and identifying
patterns of program abuse, closer monitoring and disclosure of
questionable medical reports and disqualified CE providers, and
more information in medical reports relating to applicant performance
on psychological tests in order to detect malingering.
Fourteen OIG, Office of Investigations (OI) suggestions
and observations that target SSA`s need for improved procedures
for fraud detection, training to enhance employee fraud awareness,
and better coordination and development of fraud cases and referrals.
A detailed list of the recommendations, suggestions, and
observations is shown on pages 14 to 16 of this report.
AGENCY COMMENTS
SSA generally agreed with the three recommendations proposed
by the joint review and all but one of the eight OA recommendations.
SSA implemented two recommendations and agreed to implement suggested
actions or to reemphasize existing policies in eight of the remaining
recommendations during
Fiscal Year 1998. With regard to the remaining 14 suggestions
and observations made, SSA stated that it is examining them and
will take appropriate action as necessary.
The only recommendation with which SSA disagreed involved
OIGs suggestion that DDSs avoid using as CEs the same professionals
who are shown not to be independent because they treated, and/or
continue to treat, claimants for their medical/emotional conditions.
In its response, SSA stated that although it shared the OIGs
concern about potential or perceived conflicts-of-interest arising
from CEs performed by a treating source, it did not agree with
the implication that a treating source cannot be independent. Additionally,
SSA explained that legal requirements state that the treating source
is the preferred source for CEs. Accordingly, without more compelling
data than that presented in this report, SSA did not believe a
policy change was warranted. (See Appendix A for the full text
of the Agencys comments.)
OIG RESPONSE
We believe that SSA misunderstood the intent of our recommendation
related to the need for DDSs to seek independent sources for some
CEs. We do not suggest that SSA revise current regulations or policies
that define treating physicians as the preferred source to perform
a CE. In fact, in most cases we agree that the treating source
is the most knowledgeable and cost-efficient authority to evaluate
and provide a conclusion regarding a claimants ability to
perform substantive gainful activity.
Nevertheless, as evidenced by the cases presented in this
report, DDSs sometimes encounter treating sources who they believe
to be unreliable due to relations or circumstances that cast doubt
on the sources objectivity toward the claimant; or questionable
evidence and reporting practices that may include indications of
feigned disabilities or coaching, or the virtually identical reporting
of symptoms and laboratory findings for other claimants. As such,
our recommendation suggested that SSA should:
"emphasize to DDSs the need to avoid using as CEs
the same professionals who are shown not to be independent because
they treated, and/or continue to treat, claimants for their medical/emotional
conditions. DDSs should act in accordance with authority established
in section 416.919i which permits them to use other sources in
instances when they feel they are not receiving independent evaluations." (Emphasis
added.)
The OIG affirms this recommendation and requests that SSA
reconsider its position regarding reemphasizing DDSs authority
to use other sources when they believe that a treating source cannot
provide an independent CE.
The objective of this audit was to identify vulnerabilities
in the disability determination process that subject the SSI Disability
Program to abuse.
BACKGROUND
The SSI program, authorized in 1972 under title XVI of the
Social Security Act, is a cash assistance program financed from
general funds of the U.S. Treasury. The SSI program assures eligible
individuals a minimum level of income who are aged, blind, and
disabled. Eligibility requirements are uniform throughout the 50
States and the District of Columbia. There is no minimum age limit
in establishing eligibility on the basis of blindness or disability.
Monthly SSI payments for disabling impairments are determined mainly
by individual income and resources.
Until 1990, the regulatory criteria for determining disability
in children were different from those used for adults. The Supreme
Court decision in Sullivan v. Zebley (1990) required SSA to determine
childhood disability in a manner comparable to the determination
of disability in adults. All children who had SSI benefits denied
or terminated for medical reasons, between
January 1980 and February 1991, became members of the Zebley
class. SSA estimated that 452,000 children were affected by the
court decision. Additional elements for the disability decision
process were developed. IFAs were used to evaluate childrens
disabilities. Children eligible for benefits under the new rules
were also considered for retroactive benefit entitlements.
The new evaluation process expanded the method of determining
the equivalency of childrens medical impairments to SSAs
medical listings criteria and allowed a determination of disability
based on a finding that a childs impairments were functionally
equivalent to a listed impairment. Children not meeting the listings
criteria were given IFAs to determine the extent to which the impairment
limited the childs ability to function independently, effectively
and appropriately in an age appropriate manner in general domains
and behaviors, namely cognitive, communicative, motor, social,
and personal skills. Recognizing that childrens functioning
varies widely from age to age, the new regulations contained age-appropriate
guidelines. For the first time, detailed guidelines for evaluating
mental disorders in children covered conditions such as drug addiction
and alcoholism, anxiety disorders, hyperactivity, and personality
disorders. Since the Zebley decision, the number of children eligible
for SSI has increased dramatically, both due to the reversal of
past denial decisions and the increase in new applications.
SSA published data that shows since SSI payments began in
1974, the number of eligible children has increased from 70,000
severely disabled children, almost all of them under age 18, to
nearly 1 million children in 1995. Monthly SSI payments rose from
an estimated $30 million in 1974, to $436 million in 1995. A 1996
study found that once eligible, beneficiaries who are disabled
at birth or during childhood are likely to remain on the rolls
for long periods of time. The analysis found that during the period
1975 to 1993, the expected duration of pre-retirement age benefits
increased from about 11 years to nearly 18 years for SSI. The increase
related to the decreasing age of awardees and the increasing incidence
of mental impairments as a diagnosis. These changes can be seen
in the substantial growth in the number of children receiving SSI
after 1989, from 296,000 in December 1989, to 974,000 in December
1995.
SSA is responsible for administering the SSI disability program
and contracts with State DDS offices to perform determinations
of claimants disabilities. To supplement evidence obtained
from the claimants physicians or other treating sources,
the DDSs are authorized to purchase medical examinations, x-rays,
and laboratory tests on a consultative basis. The DDSs are reimbursed
by SSA for 100 percent of allowable expenditures.
Representatives of SSA Regional and District offices and
representatives of DDSs from the States of Georgia, Wisconsin,
California, and Illinois met through a series of conference calls
in mid-1996 to develop recommendations for fighting disability
fraud. All of the participants were experienced in dealing with
disability fraud and program abuse. Our interviews of these individuals
disclosed that the Georgia family cases were not isolated instances.
These representatives cited many instances where similar abuses
were occurring nationwide. This representative cross section of
SSA components illustrates that the fraud problems encountered
throughout SSA and the proposals for change were strikingly similar.
The group developed a uniform set of recommendations dealing primarily
with prevention, but also detection and penalties. These recommendations
were presented at the National Fraud Conference sponsored by SSA
and OIG in September 1996. Several of their prevention and detection
recommendations are included in this report.
History of the Review
Program abuses by the Georgia family surfaced in 1992, after
the Georgia DDS received reports of numerous family claims for
SSI. The Georgia DDS notified SSA Region IV personnel of its concern
that SSI recipients in the familys residential area may have
been coached to malinger during CEs to fraudulently obtain SSI
disability payments.
An SSA regional official reported that in February 1993,
a member of the Georgia family was suspected to have malingered
during a CE with a local psychologist frequently used by the DDS.
The malingering suspicions were confirmed when the CE was repeated
by another physician. Other DDS medical staff had complaints about
the local psychologists inadequate medical evidence. The
DDS wrote to the psychologist concerning 10 specious evaluations
he had performed and visited him to discuss his failure to report
malingering. The DDS efforts had no effect.
Another family claimant, a 23 year old mother of 2 children,
made no effort to cooperate during the CE. With an IQ score of
55, she complained of hallucinations consistent with paranoid schizophrenia.
The psychologist referred her to the Department of Family and Children
Services (DFCS). Two home visits from the State showed the claimant
had no impairments. She presented herself as competent to DFCS
and incompetent to SSA. Another CE by the same psychologist showed
her as incompetent. The DDS identified discrepancies in the CE
providers medical reports when compared to other corroborating
evidence from school psychologists reports and test results.
The DDS decided to remove the psychologist as a CE provider. SSA
was not notified of the DDS decision, since there was no procedural
requirement to do so. SSA could have created a list to identify
removed providers for release to SSA field and regional offices,
other DDSs, and Federal/State agencies which administer programs
with which CE providers might be involved (e.g., Medicaid and Medicare).
In late 1994 and early 1995, SSAs Office of Disability
(OD) began reviewing the Georgia family claims with common diagnoses
of slow learning and hyperactivity, nerves and hallucinations.
In isolation, the 11 initial cases did not appear unusual. However,
when compared with the aggregate family claims, patterns of potential
abuse emerged indicating potential vulnerabilities in the eligibility
process. In March 1995, results of the OD reviews were shared with
members of the special joint review team, comprised of staff from
SSA, Georgia DDS, and OIGs OI and OA, which had been assembled
to assess SSA`s vulnerability. A female SSI recipient, who
acted as a representative payee (Rep Payee) for several family
members, became the principal focus of the joint review.
In mid-1995, SSA initiated CDRs for selected recipients.
The majority of initial eligibility determinations were completed
between 1990 and 1993. The team formed a cooperative effort to
evaluate the alleged irregularities. About 300 family members,
including 181 SSI recipients, were identified in the extended Georgia
family. In August 1995, the OA Region IV audit staff joined the
effort. These recipients became the basis for this review.
OIG Investigative Activity
As part of the joint review, OI investigated allegations
of fraud in this particular case. We will describe those events
that transpired in awarding the claims and subsequent actions to
terminate the individuals benefits that resulted in a declination
by the Assistant U.S. Attorney.
One reason the cases were declined for prosecution resulted
from the failure of SSA to prove that recipients were not disabled
at the time they applied for SSI benefits. SSA cessations were
based on medical improvement at the time of the reviews. Another
reason was SSAs inability to locate the disability case folder
for the recipient alleged to have coached individuals to malinger
during psychological examinations or feign disability. In the absence
of the folder, SSA could not show medical improvement and could
not terminate this individuals benefits. In addition, no
proof of coaching could be established. A third reason cited for
declination was SSAs use of the psychologist responsible
for many of the medical reports for 15 years, making it difficult
to prove the reports were false.
Our objective was to identify the vulnerabilities disclosed
by the joint effort of the SSA, DDS, and OIG team in the disability
determination process that subjected the SSI Disability Program
to abuse.
To accomplish our objective, we:
reviewed the laws and regulations relating to SSI disability
benefits and SSA Disability Digests.
reviewed SSA policies and procedures in the Program Operations
Manual System.
conducted discussions with SSA regional personnel and the
Georgia DDS to determine the procedures used in processing disability
claims.
reviewed ODs preliminary analyses of case folder
documentation.
analyzed CDRs of 151 SSI recipients under the age of 55
from the population of 181 SSI recipients identified in the extended
Georgia family.
reviewed case folders and SSI records for the first 66
SSI recipients whose SSI benefits were discontinued upon completion
of the CDRs.
provided information on the 66 discontinued cases to SSAs
Office of the Actuary for calculation of estimated cost savings
on the Georgia family.
We limited our review to the 66 cessations, because we believed
the vulnerabilities identified in those cases would be representative
of the conditions in the entire Georgia family. Since the sample
was judgmentally selected, the review results were not projected
to the total population of recipients. Our review of documentation
was limited to the vulnerabilities identified in SSAs preliminary
review.
We reviewed the internal controls necessary to meet our objective.
Audit work was performed at the following locations: the SSA Regional
Office in Atlanta, Georgia; SSA/OIG/OA field office (FO) in Birmingham,
Alabama; and the Georgia DDS. The field work was completed in February
1996. Our audit was performed in accordance with generally accepted
government auditing standards.
A review of the Georgia family cases shows that the SSI program
is susceptible to abuse. Policy, procedures, and detection of abuse
can be strengthened by monitoring and evaluating the performance
of CE providers, and placing greater emphasis on the detection
of malingering during the initial claims process and CDRs. The
DDS did not employ all relevant procedures in evaluating eligibility
for SSI disability. The joint review found that information requests
from third party sources were not being adequately performed within
the DDS. Little educational evidence was obtained in the way of
school records and teacher evaluations or other independent corroboration
of claimants statements. No mention was made of applicants attempts
to manipulate the psychological testing, or the level of effort
put forth during testing. SSAs preliminary review of case
folders and documentation revealed the determinations were based
on misleading or inaccurate information from claimants, third parties,
or medical sources.
The CDRs performed by SSA on the 66 Georgia family recipients
in our sample, (22 adults and 44 children), resulted in the cessation
of SSI benefits: 58 were due to medical improvement, 7 were due
to lack of cooperation, and 1 was due to gainful employment. The
majority of medical disabilities, 53 percent, related to mental
retardation, 33 percent were various physical and emotional disorders,
and 14 percent were attention deficit/hyperactivity disorders.
Psychological evaluation reports concluded that 24 of the 66 recipients,
14 adults and 10 children, malingered during the CDRs. The DDS
believes most of the claimants initially qualified on the basis
of malingering. The rising costs of processing these false applications
burdens the DDS and SSA FOs.
The 66 recipients received in excess of $1.06 million in
SSI disability benefits, through June 1995, including over $431,000
in benefits to the 24 malingerers. Due to the volume of payments,
we believe SSA should identify SSI recipients in the remainder
of the 500 members of the extended Georgia family disclosed to
date and conduct CDRs. SSA should calculate the cost/benefit results
of the CDRs. We also believe the payment status of 15 individuals
who continued to receive title II benefits as of December 1996
should be reviewed since SSI benefits had ceased due to medical
improvement.
The CDRs performed by SSA revealed two primary areas of vulnerability
in the SSI disability review process: consultative examinations
and malingering.
The DDSs strong reliance on a single provider to perform
CEs causes the SSI program to be vulnerable to abuse.
The DDS frequently used one local psychologist with offices
in Statesboro and Vidalia, Georgia to perform CEs. A review of
the Georgia family showed there were a number of treating physicians
and psychologists in the area. The local psychologist participated
in the initial CEs of 38 of the 66 discontinued claimants in our
sample, or about 58 percent of the cases; and 13 of the 24 malingering
cases, or 54 percent. He also participated in two of the CDRs.
The presence of the local psychologist in so many of the Georgia
familys discontinued claims brings into question his independence
and objectivity during the initial claims process.
We found discrepancies between the local psychologists
findings and the observations of other independent third parties.
A case worker from the Georgia DCFS, a social services agency,
who made home visits to the Georgia family, said she never saw
abnormal children. Yet, this psychologist always found problems
with the family. He continued to treat these SSI recipients and
received Medicaid payments. The DDS medical staff had complaints
about the psychologists inadequate medical evidence. The
DDS wrote to the psychologist concerning 10 unsatisfactory evaluations
he had performed and visited him to discuss his failure to report
malingering. However, the psychologist failed to see anything wrong.
An SSA attorney in the Office of Hearings and Appeals said this
psychologist never found a claimant to malinger, even in records
going back 20 years.
On November 2, 1993, the DDS informed the Office of Hearings
and Appeals that the Disability Adjudication Section (DAS) had
ended its working relationship with the psychologist. After the
standards for Consultative Examinations and Existing Medical Evidence
were published in the Code of Federal Regulations in August 1991,
DAS staff psychologists became increasingly concerned with the
quality of this CE providers work. The three specific areas
of concern were: consistently lower than expected intelligence
test results; frequent diagnostic conclusions based on subjective
reports of claimants; and the total absence of suspected malingering
in evaluations, even when the CE provider had been alerted. The
DDS did not notify SSA of its decision. The DDSs should be required
to notify SSA whenever providers are disqualified for cause or
questionable "canned" medical reports or other data are
received.
SSA does not require rotation of CE providers nor do DDSs
adequately rotate CE providers, which results in excessive reliance
on a single professional. SSA should not permit DDSs to use as
consultants those professionals who treat, or continue to treat,
claimants for their medical/emotional conditions when the independence
of the CE provider may be suspect. DDSs do not monitor or periodically
evaluate the performance of CE providers for any patterns of potential
program abuse. In poor rural areas, residents are often without
means to pay for medical services and medical providers are in
short supply. Reliance on Government programs such as SSI and Medicaid
by both parties may impair the independence of the CE. While we
recognize that rotating and monitoring CE providers may be difficult
in rural areas, we believe this would reduce similar incidences
of program abuse.
The lack of information regarding the level of effort in
CE reports on psychological test results causes the SSI program
to be vulnerable to abuse.
The DDS we reviewed generally obtained medical evidence,
some educational evidence such as teacher evaluations and school
records, parental statements, hospital records, and other types
of evidence to corroborate claimants statements for SSI disability.
Although psychological reports in the initial determinations contained
observations on the claimants` physical appearance and demeanor
and test scores on the various tests administered by the treating
sources and/or CEs, the reports did not contain any comments on
the extent of effort put forth by the claimants during the examinations.
Our comparison of SSA/OD preliminary analyses with CEs performed
by licensed psychologists during the CDR process contained the
following examples of malingering, coaching, misleading and conflicting
evidence provided by claimants, third parties, or medical sources:
Case 1
SSA/OD identified a claimant with alleged bad nerves, partial
blindness, and a partial hearing problem. The claimant requested
that questions concerning her hearing problem be repeated, because
she was almost deaf. Yet, the claimant had no problem hearing questions
addressing her other alleged impairments. The claimant said she
had always attended special education classes and had never reached
the 12th grade. This contradicted information she had provided
in
1990 about having a high school diploma. The claimant also
alleged she had been hospitalized with a nervous breakdown, but
neither the hospital nor her treating physicians had any record
of her hospitalization or breakdown.
The claimants mother, also an SSI recipient, accompanied
her to a CE with the local psychologist and reported contradictory
histories. The claimant reported that her mother helped her cook
meals and pay her bills. During her own CE 2 months earlier, the
mother had alleged the claimant always managed her, the mothers,
money. The psychologist found the claimants IQ to be in the
mentally retarded range, noting she would be dependent for the
rest of her days.
Subsequent to her receiving entitlement, the claimant filed
applications on behalf of her two children and assisted her father
in processing an application. She asked if her father could be
sent to the same psychologist and receive disability payments pending
a final decision. The SSA reviewer considered these accomplishments
remarkable considering the psychologist`s diagnosis. The claimant
received $17,238 in SSI benefits as of October 1994.
Case 2
The psychologist performing the CDR identified the claimant,
an extremely uncooperative child who offered little information
about himself, as malingering and capable of significantly better
performance than noted in the test results. According to a teacher
questionnaire, the child`s parents instructed the child to
do whatever was necessary to keep the checks coming. The claimant
received $56,444 in SSI benefits as of June 1995, based on the
initial determination of mental retardation.
Case 3
The psychologist conducting the CDR identified the child
as malingering, noting the child used her left hand on all tasks
during a "Developmental Test of Visual-Motor Integration" even
though the child was actually right-hand dominate. The claimant
received $13,308 in SSI benefits as of June 1995, based on an initial
determination of mental retardation.
Case 4
The psychologist performing this CDR concluded there was
no evidence of mental retardation, the original disabling condition
diagnosed at age 4. DDS noted that every time the claimant tried
to talk, the mother would put her hand over his mouth. The teachers
report indicated the child was in regular classes, and there was
no evidence of mental retardation. The teacher commented that the
claimants concentration problems were no more than a normal
first grader. The mother alleged attention deficit/hyperactivity
disorder 2 years earlier, but the claimant had ceased medication
a year earlier. Also, the teacher noticed no change in his behavior.
The claimant received $16,668 in SSI benefits as of June 1995,
based on the initial determination of mental retardation.
We compared the information developed on these and other
cases during the CDR process with documentation obtained during
the initial determinations. There was no mention of malingering
or attempts to manipulate the psychological testing procedures
during the initial determination process. The DDS noted tests for
malingering are useful. Despite the large percentage of mental
retardation and physical/emotional disorders, there was little
educational evidence obtained during the initial determination
process to corroborate the alleged disabilities.
Prior to Zebley, the decision under childhood procedures
was based solely on the childs ability to meet or equal the
impairment listings for adults or the CEs, when performed. In 1991,
the DDS began to request third party documentation for children`s
cases in the same manner as for adults. In the 66 cessations reviewed,
educational evidence obtained nearly tripled, from 37 instances
initially, to 95 at the time of the CDRs. Determinations of medical
recovery for concurrent beneficiaries, i.e., individuals receiving
both title II and title XVI benefits, apply to both programs. Although
the DDS reviewed both titles, 15 of the 66 terminated recipients
analyzed were receiving title II benefits as of December 1996.
SSA needs to capture this kind of information in the form of additional
comments or codes on the SSI master file. This information should
then automatically be highlighted on SSID to alert subsequent users
to potential fraud/abuse. The 120 character remarks field on the
SSID could easily accommodate a specific comment such as "potential
abuse/year" or codes, or a field could be added at the end
of this on-line query.
The DDSs do not emphasize to CE providers and treating sources
the need to include comments in the report of evaluation about
the level of effort put forth on psychological exams by SSI applicants
who allege mental retardation, which results in improper evaluations.
Additional information from reliable third party sources such as
State agencies that service these claimants, teachers, and former
employers would alert the DDSs to possible malingering. School
records should be obtained for adults to support allegations of
a history of mental deficiencies. Also, there are no procedures
that require CE providers to verify the identity of the applicant
being tested. The DDSs need to employ psychological testing designed
to detect malingering, the use of photographs or other identification
to verify the identity of claimants attending CEs, obtain school
records and teacher evaluations, and obtain other independent corroboration
of the claimants statements. To maximize this information,
prior claims folders, including appropriate files of other family
members, should be associated and reviewed.
The DDS recently identified a similar disability fraud/abuse
case involving an extended family in another rural area of Georgia.
Five SSA offices and three DDSs contacted around the country were
of the opinion that the Georgia family was not an isolated instance
of coaching and malingering to obtain government benefits. All
eight offices had experienced similar instances of disability fraud/abuse.
Two offices stated that fraud within the disability program is
extensive. Another office remarked that every region in the country
has experienced some variation of the fraud perpetrated by the
Georgia family.
Although the cases encountered were not always identical
to the Georgia family, four of the offices cited numerous cases
in which claimants file false disability claims with the assistance
and coaching of physicians and translators. As in the Georgia family
case, many of the applicants used the same translators and physicians
during the evaluations. One DDS currently has 130 cases of interpreter
fraud under review. The DDS independently hired translators that
speak the required languages to preclude fraudulent coaching by
interpreters hired by the applicants. Another office estimated
that in about 50 percent of the cases involving translators, applicant
information is suspect.
A DDS office observed that the number of fraudulent disability
cases reported by SSA has increased dramatically since the agency
retained additional investigators to examine and seek prosecutions.
Two convictions of fraudulent disability claims related to children
have been obtained, and similar cases are being reviewed for possible
prosecution. The DDS annually sends deterrent letters to about
40 to 60 applicants found to have made blatantly false statements
during the claims process. The letters contain a warning regarding
the penalties for false statements.
Although several offices cited cases that were not as large,
either monetarily or in number of family members as detected in
the Georgia family, 1 office experienced 30 to 40 similar instances
of disability fraud every year. Fraud cases in this office are
often identified through information provided by third parties.
Another example involved 80 members of an extended family in a
rural county in which benefits to 70 percent of family members
were ceased based on CDRs.
Two offices thought SSAs policies and procedures regarding
the determination of disability cases were vulnerable to abuse.
One office cited reliance on third party information and limited
medical evidence. Many disability applicants were counseled on
how to obtain SSI benefits before they left their countries of
origin. Many of the symptoms alleged by the claimants are identical.
Due to the preponderance of fraudulent disability claims, this
SSA office, in cooperation with the Federal Bureau of Investigation,
Internal Revenue Service, Postal Service, and U.S. Attorney, formed
a white-collar crime task force. To date, the task force has successfully
prosecuted 25 to 30 SSI recipients and reopened another 65 cases
now under investigation. The group is pursuing administrative actions
on fraudulent claims along with prosecutions. The benefits paid
to these claimants have been deemed overpayments subject to recovery
and are also being pursued.
In 1994, SSA provided a 3-year grant to a DDS to create a
fraud unit. The goal of the unit was to focus on investigating
suspicious claims prior to adjudication and to prevent fraudulent
payments. The unit experienced some difficulty in its first 2 years
in staffing the investigative positions, but recently has had some
success in denying claims. In an effort to maximize the potential
of this type of unit, SSA is creating five additional DDS fraud
units, which are expected to become operational by February 1998.
These units will include experienced criminal investigators. In
addition to investigations to prevent payments on fraudulent claims,
criminal investigations will be conducted to seek prosecution of
doctors, middlemen and interpreters conspiring with claimants to
obtain fraudulent disability benefits.
We estimate that Federal funds of approximately $2.1 million
in SSI and Medicaid benefits could be realized based on the 66
initial cessations as of February 1996, plus 24 supplemental cessations
in the Georgia family since that date, for a total of 90 cessations
as of March 1997. The estimated range of savings was $1.7 million
to $2.5 million. Savings were based on the results of our review
and actuarial projections provided by SSA`s Office of the Chief
Actuary. It is also likely that additional savings will result
when the remainder of CDRs are completed.
Using the detailed data provided by OIG/OA, the actuary estimated
that some cessations would be reversed on appeal and applied benefit
savings based on historical data developed on SSI recipients selected
for CDRs and discounted the savings to present value. The actuary
qualified the estimates, stating that characteristics of a selected
group such as the extended Georgia family may differ significantly
from the general population of SSI recipients selected for periodic
reviews. The range of savings results from variable factors in
the payment of benefits, such as the number of cases that can be
expected to have SSI benefits terminated for reasons other than
CDR`s and the number that can be expected to resume benefits
after initial cessation.
Based on the review results, the SSA Regional Office, Georgia
DDS, and OA developed interim recommendations designed to reduce
or eliminate SSI payments to individuals who do not meet the SSI
eligibility requirements for disability. The tentative recommendations
were:
establish and implement an educational coordinator or equivalent
position at DDSs to develop a working relationship with individual
schools, school systems, State department personnel, and teachers
in the area covered by the DDS;
provide updated training for all DDS personnel responsible
for processing SSI applications to emphasize the nature and extent
of evidence needed for proper SSI eligibility determinations,
and to recognize typical patterns of program abuse so appropriate
action can be taken; and
modify the SSID to include comments or codes for the identification
of potential fraud/abuse cases.
SSA will continue to use CDR procedures to discontinue SSI
payments to other recipients who do not meet the eligibility requirements
for continuing disability.
Recent legislative changes will affect SSA`s administration
of the SSI disability program. The PRWOR Act of 1996, section 212,
requires SSA to conduct CDRs on SSI child recipients at least once
every 3 years. Section 211 eliminates the comparable severity standard
and the maladaptive behavior criteria from personal and behavioral
functioning for childrens disabilities. The legislation directs
SSA to discontinue the use of IFAs in evaluating children`s
disabilities and requires SSA to redetermine the eligibility of
SSI recipients enrolled under the eliminated provisions no later
than 1 year after enactment of the law.
Section 231 also requires the Commissioner to report annually
to the President and Congress on the SSI program regarding, among
other things, historical and current data on allowances and denials,
reconsiderations, administrative law judge hearings, appeals council
reviews, Federal court decisions, and characteristics of recipients
and program costs. We believe the implementation of a management
control system to monitor the cost/benefit results of all redeterminations
and CDRs would be a valuable tool for SSA`s use in reporting
the results of changes in SSI eligibility provisions under the
newly enacted legislation.
We continue to support the joint review recommendations and
believe that SSA should:
Establish and implement an educational coordinator or equivalent
position at DDSs to develop a working relationship with individual
schools, school systems, State department personnel, and teachers
in the area covered by the DDS.
Provide updated training for all DDS personnel responsible
for processing SSI applications to emphasize the nature and extent
of evidence needed for proper SSI eligibility determinations, and
to recognize typical patterns of programabuse so appropriate action
can be taken.
Modify the SSID to include additional comments or codes for
the identification of potential fraud/abuse cases, subject to SSA`s
evaluation of the most advantageous method of presentation on the
SSID.
In addition to the interim recommendations made by the joint
review team, we are also recommending that SSA:
Identify SSI recipients in the remainder of the 500 members
of the extended Georgia family and conduct CDRs and evaluate
the results, individually and collectively, to determine if there
is any pattern or potential patterns of fraud that may warrant
referral to OI.
Review the payment status of individuals in the Georgia
family who continued to receive title II benefits as of December
1996, since SSI benefits ceased for these individuals due to
medical improvement.
Emphasize to DDSs the need to rotate CE providers where
medical services are available (especially in high-risk profile
cases) and to identify any potential patterns of program abuse
during monitoring and periodic evaluation of CE providers.
Require DDSs to identify providers who issue questionable "canned" medical
reports and determine whether these reports should be disqualified.
Require DDSs to notify SSA when CE providers are disqualified
for cause and require SSA to establish a list of disqualified
providers for release to SSA field and regional offices, other
DDSs, and Federal/State agencies which administer programs with
which CE providers might be involved (e.g., Medicaid and Medicare).
Emphasize to DDSs the need to avoid using as CEs the same
professionals who are shown not to be independent because they
treated, and/or continue to treat, claimants for their medical/emotional
conditions. DDSs should act in accordance with authority established
in section 416.919i which permits them to use other sources in
instances when they feel they are not receiving independent evaluations.
Require DDSs, when contracting for CEs, to emphasize to
CE providers and treating sources the need to include comments
in the report of evaluation about the level of effort put forth
on psychological exams by SSI applicants who allege mental retardation,
or stipulate testing designed to detect malingering in high-risk
profile cases. The DDSs should also be required to adhere to
procedures for obtaining school records, teacher evaluations,
and other corroborating evidence of claimants statements.
Implement a management control system to monitor the cost/benefit
results of all redeterminations and CDRs for SSA reporting purposes
under the provisions of the PRWOR Act of 1996.
The following suggestions and observations were developed
by the OIG investigative team in Atlanta, Georgia. These recommendations
are for SSAs consideration:
Add questions in the SSI interview process to enlist the
identities of the applicant`s immediate family drawing SSI
(e.g. parents, siblings and children).
Conduct CDRs on children ages 7 to 17 every 2 years for
possible medical improvement.
Diary pre-school aged children where mental impairment
has been established and conduct a CDR after the child has completed
1 year of school.
Establish a mechanism for periodic evaluation (possibly
at 2 or 3 year intervals) of the quality of the medical reports
provided by consultative sources.
Use standard operating procedures with minimum variations
to develop cases involving more than one subject. Variations
in procedures can taint evidence and lessen prosecutive appeal.
Refrain from the inclusion in medical reports of personal
opinions and comments that are neither medically verifiable nor
germane to the issues that have a tendency to appear biased and
prejudicial.
Refer all related claims folders to OI as a package when
more than one subject is involved so that the fraud potential
can be assessed as a whole.
Refer allegations of fraud solely to OIG/OI which has statutory
responsibility for the conduct of potential criminal investigations
and expertise and familiarity with prosecutive guidelines in
the various jurisdictions. Even though the violation may be egregious,
the monetary loss is usually the most significant factor in determining
the prosecutive merits.
Conduct training for all OIG/OA personnel and other SSA
operating components on what constitutes fraud and what is necessary
for a successful prosecution.
Limit the number of persons for whom an individual may
act as a Rep Payee (other than for children, step-children, and
adopted children) unless the individual is serving in a fiduciary
capacity.
Notify OI as soon as a potential disability fraud case
is detected. There is no need to hold a case open for fraud development,
since it can be denied for non-disability factors.
Encourage each of SSAs components to strictly adhere
to SSA guidelines in the development and adjudication of cases.
Ensure that all routine development for medical, as well
as nonmedical, determinations, is completed by appropriate personnel
before the fraud aspects are developed since such development
could have a bearing on the potential fraud.
Ensure that information pertaining to the status of open
OI cases is restricted and provided to SSA managers on a "need
to know" basis only. OI case information should not be routinely
disseminated.
SSA generally agreed with the three recommendations proposed
by the joint review and all but one of the OA recommendations.
SSA implemented two recommendations and agreed to implement suggested
actions or to reemphasize existing policies in eight of the remaining
recommendations during Fiscal Year 1998. With regard to the remaining
14 suggestions and observations, SSA stated that they are examining
them and will take appropriate action as necessary.
The only recommendation with which SSA disagreed involved
OIGs suggestion that DDSs avoid using as CEs the same professionals
who are shown not to be independent because they treated, and/or
continue to treat, claimants for their medical/emotional conditions.
In its response, SSA stated that, although it shared the OIGs
concern about potential or perceived conflicts-of-interest arising
from CEs performed by a treating source, it did not agree with
the implication that a treating source cannot be independent. SSA
explained that a treating physician is the medical expert most
familiar with a claimants condition and, because of the treating
relationship, the treating physician is in the best position to
evaluate the effects of the condition on a claimants ability
to perform substantive gainful activity.
Additionally, SSA explained that legal requirements, as detailed
in the Code of Federal Regulations sections 404.1519h and 416.919h,
state that the treating source is the preferred source for CEs.
Accordingly, the Agency would have to rescind these regulations
if it changed its policy regarding the preferred source for performing
a CE. Therefore, SSA stated that without more compelling data than
that presented in this report, they could not justify changing
the present policy. (See Appendix A for the full text of the Agencys
comments.)
OIG RESPONSE
We believe that SSA misunderstood the intent of our recommendation
related to the need for DDSs to seek independent sources for some
CEs. We do not suggest that SSA revise current regulations or policies
that define treating physicians as the preferred source to perform
a CE. In fact, in most cases we agree that the treating source
is the most knowledgeable and cost-efficient authority to evaluate
and provide a conclusion regarding a claimants ability to
perform substantive gainful activity.
Nevertheless, as evidenced by the cases presented in this
report, DDSs sometimes encounter treating sources who they believe
to be unreliable due to relations or circumstances that cast doubt
on the sources objectivity toward the claimant; or questionable
evidence and reporting practices that may include indications of
feigned disabilities or coaching, or the virtually identical reporting
of symptoms and laboratory findings for other claimants. As such,
our recommendation suggested that SSA should:
"emphasize to DDSs the need to avoid using as CEs
the same professionals who are shown not to be independent because
they treated, and/or continue to treat, claimants for their medical/emotional
conditions. DDSs should act in accordance with authority established
in section 416.919i which permits them to use other sources in
instances when they feel they are not receiving independent evaluations." (Emphasis
added.)
The OIG affirms this recommendation and requests that SSA
reconsider its position regarding reemphasizing DDSs authority
to use other sources when they believe that a treating source cannot
provide an independent CE.
Gary A. Kramer Director, Program Audits
Betty Alexander Deputy Director, Program Audits
William C. McMillan Deputy Director, Program Audits (Acting)
Shable B. Benefield Auditor-in-charge
Douglas L. Boyer Auditor
Robert Daniels, Jr. Auditor