Office of the Inspector General
Larry G. Massanari
Acting Commissioner of Social Security

Inspector General

Medical Evidence of Record Collection Process at State Disability Determination Services (A-07-99-21003)

The attached final report presents the results of our audit. Our objectives were to: (a) review and assess the efficiency of the medical evidence of record collection process at State Disability Determination Services (DDS), and (b) assess the DDS’ ability to provide the Social Security Administration with management data.

Please comment within 60 days from the date of this memorandum on corrective action taken or planned on each recommendation. If you wish to discuss the final report, please call me or have your staff contact Steven L. Schaeffer, Assistant Inspector General for Audit, at (410) 965-9700.

James G. Huse, Jr.

 

OFFICE OF

THE INSPECTOR GENERAL

SOCIAL SECURITY ADMINISTRATION

MEDICAL EVIDENCE OF RECORD

COLLECTION PROCESS

AT STATE DISABILITY3

DETERMINATION SERVICES

June 2001

A-07-99-21003

AUDIT REPORT

Executive Summary

OBJECTIVE

Our objectives were to: (a) review and assess the efficiency of the medical evidence of record (MER) collection process at State Disability Determination Services (DDS); and (b) assess the DDS’ ability to provide the Social Security Administration (SSA) with management data.

BACKGROUND

SSA is responsible for establishing the policies on developing disability claims under the Disability Insurance (DI) and Supplemental Security Income (SSI) programs. Disability determinations under SSA’s DI and SSI programs are performed by each State’s DDS in accordance with Federal regulations. DDSs are responsible for obtaining adequate medical evidence to support the disability decision. In doing so, DDSs may purchase consultative examinations (CE) to supplement the MER obtained from claimants’ treating sources. SSA reimburses DDSs for 100 percent of allowable expenditures.

SSA instructs DDSs to make every reasonable effort to obtain MER from claimants’ treating sources. SSA’s instructions define every reasonable effort as: (1) making an initial request for MER from the treating source; (2) making a follow-up request any time between 10 and 20 calendar days after the initial request if the MER has not been received; and (3) allowing a minimum of 10 calendar days from the follow-up request for the treating source to respond. If MER is not received within 10 calendar days from the follow-up request, the DDS can purchase a CE—an expensive and time-consuming process.

RESULTS OF REVIEW

The current MER collection times account for a considerable portion of overall disability claims processing times because the processes of requesting and receiving MER are slow and labor-intensive for both the DDS and the claimant’s treating source. First, the DDS sends a MER request letter to the treating source(s) identified by the claimant on his/her disability application. The treating source photocopies the MER and returns it to the DDS via mail or, in some cases, facsimile. Timeliness of MER receipt is dependent on the treating source’s workload and cooperation. As such, the time it takes treating sources to respond to DDS requests for MER can vary from a few days to several weeks.

We calculated the time it took eight DDSs to receive MER from claimant treating sources during Fiscal Year 1998. For the 663,293 MER purchased by the 8 DDSs, 64.8 percent of the MER were received within 30 days from the date of request. For the remaining 35.2 percent, the 8 DDSs waited more than 30 days to receive the MER. This represented 233,300 MER at a cost to SSA of almost $3 million. Six of the eight DDSs received 65 76 percent to 88 percent of their MER within 30 days. However, the North Carolina and Oklahoma DDSs received MER within 30 days for only 39 percent and 53 percent of their requests, respectively.

Our review also disclosed that delays in receiving MER from treating sources resulted in SSA paying for MER that was not received by the DDS until after the disability decision was made. The 8 DDSs in our review expended over $1 million to purchase 78,709 MER that were not received until after the DDS made the disability decision. The North Carolina DDS accounted for 60 percent of these MER purchases. Delays in DDSs receiving MER from treating sources can, but do not necessarily, result in the DDSs purchasing costly CEs in order to obtain medical evidence to support the disability decision. Due to insufficient management data, we were unable to determine whether delays in receiving these 78,709 MER resulted in the DDSs purchasing unnecessary CEs.

We found that the DDS’ ability to provide SSA with management data related to MER collection times varied. This variance was attributed to DDSs using different computer systems to collect MER data and to SSA not providing DDSs with uniform MER data collection requirements.

SSA is currently involved in the Specialized MER Professional Relations Officer project. This project dedicates a professional or medical relations officer solely to activities related to MER collection and is expected to last 2 years. There are six DDSs participating in the project: Puerto Rico, Florida, Illinois, Louisiana, Nebraska, and Idaho. Since tThe project is in the initial stages, and to date there are no reportable results. ., but The purpose of the project is to determine whetherif assigning one professional relations officer in each DDS to duties solely to MER retrieval will promote the timely receipt of quality MER and ultimately decrease CE costs. Expected to result in improved MER quality and decreased CE costs.

In collecting medical evidence, SSA must consider standards implemented as a result of the Health Insurance Portability and Accountability Act (HIPAA) of 1996. HIPAA requires the Secretary of the Department of Health and Human Services (HHS) to adopt national uniform standards to be followed by health plans, health care providers, and health insurers in disclosing medical information. Although HHS may not regulate SSA’s disclosure of medical information, the new regulations will have a significant impact on SSA’s ability to obtain MER from medical sources.

RECOMMENDATIONS

We recommend that SSA:

AGENCY COMMENTS

SSA agreed with our first recommendation, but did not agree with our second and third recommendations. With regard to our second recommendation, SSA stated that an internal focus group determined that the fee paid for MER is not a critical issue, and that a financial incentive would raise the total cost of obtaining evidence without improving compliance by the providers. SSA also disagreed with third recommendation, stating that uniform data collection requirements would impose a burden on DDSs to make software and processing adjustments or to undertake a prohibitive manual process. (See Appendix D for SSA’s comments.)

OIG RESPONSE

In its comments to our second recommendation, SSA stated that raising the fee for MER would simply raise the total cost of obtaining evidence without improving compliance by the providers. Our recommendation was not intended to imply an increase in MER payment amounts; nor, was it intended to provide an incentive payment to providers who do not comply with timely submission of MER. Rather, the study should consider paying the current fee to providers who submit MER within 30 days, and paying a lesser fee to providers who exceed the 30-day submission date.

With regard to our third recommendation, we acknowledge SSA’s concern that software and processing adjustments may provide an initial burden on DDSs. However, we do not believe that software modifications or processing adjustments are insurmountable problems given the importance of management information to SSA’s oversight of the disability determination process. Furthermore, as DDSs are converted to the IBM AS/400 computer system, we would expect improvements in the DDS’ ability to collect electronic data accurately and timely.

SSA agreed with our first recommendation. The full text of SSA’s comments is included in Appendix D.

SSA did not agree with recommendation 2 "conduct a study to determine whether savings in CE costs could be realized by providing a financial incentive to medical providers who submit MER within 30 days from the date of the request." SSA stated that an internal focus group determined that the fee paid for MER is not a critical issue. Furthermore, SSA stated that a financial incentive would raise the total cost of obtaining evidence without improving compliance by the providers. SSA also stated that current high priority workloads and the differences among DDS’ systems make the recommended study problematic.

SSA disagreed with recommendation 3 "improve oversight of the DDS MER collection process by: a) developing uniform MER data collection requirements for DDSs, and b) performing periodic evaluations of MER collection processes and times at DDSs to develop best practices." SSA stated that uniform data collection requirements would impose a burden on DDSs to make software and processing adjustments or to undertake a prohibitive manual process. SSA also stated that in order for it to perform periodic evaluations, most of the DDSs would have to manually track MER and the need for CEs in cases where MER is not received or is not received in a timely manner.

In its response, SSA provided technical comments that were incorporated in this final report, as appropriate.

OIG RESPONSE

We acknowledge SSA’s concern regarding the MER collection times reported for the North Carolina DDS. However, we do not concur with SSA’s position that the North Carolina DDS’s data should be excluded from our report. We clearly state, in footnote 8, that the North Carolina DDS’s MER collection times are based on MER payment dates instead of receipt dates. Due to unavailable data, we do not know if the timing differences in the two dates would result in a material difference in our MER collection times analysis. However, in consideration of SSA’s comments, we added the MER collection times with the North Carolina DDS data excluded to footnote 8.

In its comments to recommendation 2, SSA stated that raising the fee for MER would simply raise the total cost of obtaining evidence without improving compliance by the providers. This recommendation was not intended to imply an increase in MER payment amounts. Nor, was it intended to provide an incentive payment to providers that do not comply with timely submission of MER. Rather, the study might consider paying the current fee to providers that submit MER within 30 days of the request and paying a fee less than the current fee to providers that exceed the 30-day submission date.

In regards to recommendation 3, we acknowledge SSA’s concern that software and processing adjustments may provide an initial burden on DDSs. However, we do not believe that software modifications or minor processing adjustments are insurmountable problems given the importance of management information to SSA’s oversight of the disability determination process. Furthermore, as DDSs are converted to the IBM AS/400 computer system we would expect improvements in the DDS’ ability to collect electronic data accurately and timely.

The MER collection process is a critical element of disability claims processing. As such, we strongly believe that SSA needs to improve its oversight of the MER collection process. In doing so, SSA should establish uniform data collection requirements for claims processing information including MER. Without uniform MER data collection requirements, SSA may not be able to identify and resolve problems related to untimely MER submissions. And, SSA will encounter problems in analyzing MER data similar to the North Carolina DDS data problems identified in this report. Although the North Carolina DDS had the ability to collect various electronic data information, the absence of uniform data collection requirements resulted in different information being collected by the DDS than what was collected by the other DDSs in our review. In its comments to this report, SSA stated that the non-uniformity of data collection and different data systems make it difficult to conduct programmatic reviews of the DDSs. We believe this is further support for implementing our recommendation.

Table of Contents

Page

INTRODUCTION 1

RESULTS OF REVIEW 4

The Current MER Collection Process 4

The Ability of DDSs to Provide MER Management Data 56

SSA’s MER Collection Pilot Project 7

Medical Evidence Collection and HIPAA 7

CONCLUSIONS AND RECOMMENDATIONS 9

APPENDICES

APPENDIX A – Sampling Methodology and Data Analysis

APPENDIX B – Status of Prior Recommendation

APPENDIX C – SSA’s Computer Conversion Timeline for DDSs

APPENDIX D – Agency Comments

APPENDIX E – OIG Contacts and Staff Acknowledgements

Acronyms

BAH

Booz-Allen & Hamilton

CE

Consultative Examination

CY

Calendar Year

DDS

Disability Determination Services

DI

Disability Insurance

EDI

Electronic Data Interchange

FY

Fiscal Year

HHS

Department of Health and Human Services

HIPAA

Health Insurance Portability and Accountability Act

MER

Medical Evidence of Record

NDDSS

National Disability Determination Services System

OIG

Office of the Inspector General

POMS

Program Operations Manual System

SSA

Social Security Administration

SSI

Supplemental Security Income

SSN

Social Security number

Introduction

OBJECTIVE

Our objectives were to: (a) review and assess the efficiency of the medical evidence of record (MER) collection process at State Disability Determination Services (DDS),; and (b) assess the DDS’ ability to provide the Social Security Administration (SSA) with management data.

BACKGROUND

SSA is responsible for establishing the policies on developing disability claims under the Disability Insurance (DI) and Supplemental Security Income (SSI) programs. Disability determinations under SSA’s DI and SSI programs are performed by each State’s DDS in accordance with Federal regulations. DDSs are responsible for obtaining adequate medical evidence to support the disability decision. In doing so, DDSs may purchase consultative examinations (CE) to supplement the MER obtained from claimants’ treating sources. SSA reimburses DDSs for 100 percent of allowable expenditures.

In making disability determinations, the DDS develops a claimant’s complete medical history for a 12-month period based on the earliest of: (1) the application filing date; (2) the date last insured; (3) the prescribed period ending date; or (4) the attainment of age 22. If the disability is alleged to have begun during the past 12 months preceding before the application date, and does not meet one of these four criteria, then the medical history is developed based on the alleged disability onset date. To develop the claimants’ medical history, DDSs obtain and review MER from claimants’ treating sources. MER includes, but is not limited to, copies of laboratory reports, prescriptions, x-rays, ancillary tests, operative and pathology reports, consultative reports, and other technical information that documents the claimant’s health condition.

SSA instructs DDSs to make every reasonable effort to obtain MER from claimants’ treating sources. SSA’s instructions define every reasonable effort as: (1) making an initial request for MER from the treating source; (2) making a follow-up request any time between 10 and 20 calendar days after the initial request if the MER has not been received; and (3) allowing a minimum of 10 calendar days from the follow-up request for the treating source to respond. If MER is not received within 10 calendar days from the follow-up request, the DDS can purchase a CE—an expensive and time-consuming process.

Congress authorized SSA to pay for MER under the SSI program since its inception in 1974 because it was considered unreasonable to expect a claimant to pay for MER under a needs-based program. In 1980, Congress authorized SSA to pay for MER under the DI Program. In doing so, Congress believed that MER would be received more timely if payment was made, and costs would be reduced since CEs may not be needed.

SCOPE AND METHODOLOGY

To accomplish our objective we:

We conducted our audit between June 1999 and January 2001 in Kansas City, Missouri. The entities reviewed were State DDSs and the Office of Disability under the Deputy Commissioner for Disability and Income Security Programs. Our audit was conducted in accordance with generally accepted government auditing standards.

Results of Review

Our review showed that improvements are needed in MER collection times. Our analysis identified delays in DDSs receiving MER from treating sources. We found that these delays resulted in SSA paying for MER that was not received by the DDSs until after the disability decision was made. We also found that the DDS’ ability to provide SSA with management data related to MER collection times varied. This variance was attributed to DDSs using different computer systems to collect MER data and to SSA not providing DDSs with uniform MER data collection requirements.

THE CURRENT MER COLLECTION PROCESS

The DDS sends a MER request letter to the treating source(s) identified by the claimant on his/her disability application. The treating source photocopies the MER and returns it to the DDS via mail or, in some cases, facsimile. Timeliness of MER receipt is dependent on the treating source’s workload and cooperation. As such, the time it takes treating sources to respond to DDS MER requests can vary from a few days to several weeks.

We calculated the time it took eight DDSs to receive MER from claimant treating sources during Fiscal Year (FY) 1998. For the 663,293 MER purchased by the 8 DDSs, 64.8 percent of the MER was received within 30 days from the date of request (see Appendix A). For the remaining 35.2 percent, the eight8 DDSs waited more than 30 days to receive the MER. This represented 233,300 MER at a cost of $2,964,615 to SSA. The following chart provides the MER collection times for the eight DDSs.

MER Collection Times Graphic

Six of the eight DDSs received 65 76 percent to 88 percent of their MER within 30 days. However, the North Carolina and Oklahoma DDSs, received MER within 30 days for only 39 percent and 53 percent of their requests, respectively. SSA should consider options for improving MER collection times at these DDSs.

Our review also disclosed that delays in receiving MER from treating sources resulted in SSA paying for MER that was not received by the DDS until after the disability decision was made. The 8 DDSs in our review expended $1,011,772 to purchase 78,709 MER that were not received until after the DDS made the disability decision, as shown in the following table.

State DDS

Number of MER Received After the Disability Decision

MER Expenditures

Average Number of Days from the Decision Date to the MER Received Date

Delaware

1,924

$ 26,291

24

Iowa

1,801

30,921

34

Kansas

3,654

46,856

23

Massachusetts

10,189

148,692

31

North Carolina

47,266

566,050

24

Oklahoma

9,536

130,165

22

Utah

888

11,536

47

Wisconsin

3,451

51,261

51

Total

32


According to SSA’s instructions, DDSs are to review MER received after the disability decision and determine whether it has an affect on the initial disability decision. The DDS staff we interviewed stated that paying for MER received after the initial disability decision continues because: (1) the MER may be needed if the claimant appeals the initial decision; (2) the DDSs do not want to alienate treating sources by refusing to pay for untimely MER; and/or (3) payment is required by State law.

THE ABILITY OF DDSs TO PROVIDE MER MANAGEMENT DATA

We found that the DDS’ ability to provide SSA with management data related to MER collection varies. The variance exists because DDSs use different computer systems to collect MER data and SSA has not provided DDSs with uniform requirements for MER data collection.

We found that the ability of DDSs to provide information and the type of information DDSs can provide varies and this presented us with several problems in collecting and analyzing MER data for this review. The DDSs use multiple, disparate and incompatible computer systems and software to process disability claims. There are 54 DDSs that support a variety of software programs. Currently, there are 26 DDSs using WANG computer systems. However WANG no longer provides technical support to these DDSs. SSA is in the process of converting these 26 DDSs to the IBM AS/400 computer system used by other DDSs. The conversion for the first DDS—Wisconsin—was scheduled to begin on October 1, 2000. However, as of January 2001, the conversion had not begun. See Appendix C for the DDS computer conversion timeline.

A March 1997 Office of the Inspector General (OIG) report, The Social Security Administration’s Payment for Medical Evidence of Record Obtained by State Disability Determination Services (A-07-95-00833), recommended that SSA capture data on MER collection times to determine the extent to which MER is not being submitted timely. In its comments to the report, SSA agreed to perform an evaluation of MER collection times within 9 months of the date of the OIG report or by December 1997. Based on status of recommendation information obtained from SSA’s Management Analysis and Audit Program Support staff in June 2000, the evaluation was not completed because of DDS backlogs and workload pressures caused by high application rates. Appendix B contains SSA’s comments on A-07-95-00833 and the status of the report’s recommendation.

We found that SSA does not have adequate oversight of the MER collection process. SSA has not provided DDSs with uniform MER data collection requirements. As such, DDSs choose what MER information is collected resulting in inconsistent information being collected at DDSs.

Also, SSA does not monitor MER collection times. The MER information we requested from the DDSs for our review is essential management information that both the DDS and SSA should use to monitor the timeliness of MER requested from treating sources. For example, the Illinois DDS was unable to provide information on MER receipt times because the information is not captured by the DDS. Therefore, we question how or if the DDS determines the timeliness of MER receipt. Furthermore, without MER collection time information, the DDS could prematurely purchase costly CEs instead of making every reasonable effort to obtain MER as outlined in SSA’s instructions.

SSA’s MER COLLECTION PILOT PROJECT

SSA’s most recent MER initiative is the Specialized MER Professional Relations Officer project. This project dedicates a professional or medical relations officer solely to activities related to the collection of MER and is expected to last 2 years. There are six DDSs participating in the project: Puerto Rico, Florida, Illinois, Louisiana, Nebraska, and Idaho. Since tThe pilot project is in the initial stages, and to date there are no reportable results. The purpose of the project is to determine ifwhether assigning one professional relations officer in each DDS to duties solely to MER retrieval will promote the timely receipt of quality MER and ultimately decrease CE costs.expected to result in improved MER quality and decreased CE costs.

MEDICAL EVIDENCE COLLECTION AND HIPAA

HIPAA requires the Secretary of the Department of Health and Human Services (HHS) to adopt national uniform standards to be followed by health plans, health care providers, and health insurers in disclosing medical information. Although HHS may not regulate SSA’s disclosure of medical information, the new regulations may have a significant impact on SSA’s ability to obtain MER from medical sources. SSA realizes the significance of HIPAA on the disability determination process and has contracted with BAH to review the effect of HIPAA standards on electronic medical information. Furthermore, SSA has assigned responsibilities for implementation of HIPAA and related electronic medical information activities to the Office of Disability and Income Support Programs.

According to SSA, there are three HIPAA standards that may impact the disability determination process: (1) electronic data standards; (2) security standards; and (3) privacy standards.

Electronic data interchange (EDI) is the electronic transfer of information. EDI allows entities within the health care system to exchange medical, billing, and other information, as well as process transactions in a fast and cost effective manner. The health care industry recognizes the benefits of EDI and many entities within the industry have developed their own EDI formats. HIPAA required HHS to adopt national standards for EDI formats for health care information transactions, as well as code sets to be used in those transactions. Code set means any set of codes used for encoding data elements, such as tables of terms, medical concepts, medical diagnosis codes, or medical procedure codes.

HHS published the final rule for the "standards for electronic transactions" in the Federal Register on August 17, 2000. Most covered entities have 24 months to comply with the standards. SSA will be affected by these standards because medical providers may not be willing to provide medical records to SSA unless it is done electronically using a standardized coding system.

The security of health information is especially important when the information can be directly linked to an individual. Confidentiality is threatened by the risk of improper access to electronically stored information and by the interception of the information during electronic transmission. Also, there is a potential need to associate signature capability with information being electronically stored or transmitted.

HIPAA requires HHS to establish security and electronic signature standards for health care information and individually identifiable health care information maintained or transmitted electronically. Health plans, health care clearinghouses, and health care providers would use the security standards to develop and maintain the security of electronically transmitted health care information.

The HHS Health Care Financing Administration is coordinating the development of standards for security and electronic signature. This effort involves staff from various Federal agencies including SSA. These standards will impact SSA if information has to be encrypted.

Individuals who provide sensitive information to health care professionals want assurance that the information will be protected during the course of their treatment and in the future. HIPAA requires HHS to establish standards to protect the privacy of individually identifiable health information maintained or transmitted by health plans, health care clearinghouses, and certain health care providers. The HHS has adopted comprehensive regulations that would prohibit the disclosure of most patient information except as authorized by the patient or as explicitly permitted by the legislation.

HHS published the final rule for the "standards for privacy of individually identifiable health information" in the Federal Register on December 28, 2000 and it became effective on April 14, 2001. Most covered entities have 24 months to comply with the standards. SSA will be affected by these standards because providers may take a cautious, restrictive approach to implementing the privacy rules regarding disclosure of medical records. it may face restricted privacy rules in obtaining medical records.

Conclusions and Recommendations

In 1994, SSA announced its plans to redesign the disability determination process in a report titled Plan for a New Disability Claims Process. In this report, SSA attributed lengthy disability claims processing times, in part, to delays DDSs experienced in receiving MER from claimant treating sources. The report acknowledged the value of the treating sources’ information and suggested the establishment of a national fee reimbursement schedule for medical evidence. Furthermore, the report suggested rewarding the treating source based on timeliness and quality of the medical evidence.

Our review shows that improvements are needed in the MER collection process. Our analysis of MER collection times at eight DDSs found that DDSs experienced delays in receiving MER from claimants’ treating sources. As a result of these delays, SSA paid for MER that was not received until after the DDSs made the initial disability decision.

We also found that SSA does not have adequate oversight of the DDS MER collection process. SSA has not established uniform MER data collection requirements nor does it monitor MER collection times. Finally, SSA must continue to give immediate attention to the implementation of HIPAA standards to ensure the DDS’ ability to obtain timely and uniform electronic information from the health care community.

We recommend that SSA:

  1. Pursue options for improving MER collection times at DDSs experiencing problems in receiving MER within 30 days from the date of the request. This should include sharing best practices of DDSs that have been innovative in obtaining MER timely.
  2. Conduct a study to determine whether savings in CE costs could be realized by providing a financial incentive to medical providers who submit MER within 30 days from the date of the request.
  3. Improve its oversight of the DDS MER collection process by: (a) developing uniform MER data collection requirements for DDSs; and (b) performing periodic evaluations of MER collection processes and times at DDSs to develop best practices.

AGENCY COMMENTS

SSA agreed with our first recommendation. Specifically, in June 2001, SSA plans to begin a 2-year pilot, "Specialized Medical Evidence of Record Professional Relations Officer" in six States. The purpose of the pilot is to determine whether assigning one professional relations officer in each DDS to duties related solely to MER retrieval will promote the timely receipt of quality MER and ultimately decrease CE costs.. The full text of SSA’s comments is included in Appendix D.

SSA did not agree with our second recommendation and 2 "conduct a study to determine whether savings in CE costs could be realized by providing a financial incentive to medical providers who submit MER within 30 days from the date of the request." SSA stated that an internal focus group determined that the fee paid for MER is not a critical issue. Furthermore, SSA stated that a financial incentive would raise the total cost of obtaining evidence without improving compliance by the providers. SSA also stated that current high priority workloads, and the differences among DDS’ systems, make the recommended study problematic.

SSA also disagreed with third recommendation 3 "improve oversight of the DDS MER collection process by: a) developing uniform MER data collection requirements for DDSs, and b) performing periodic evaluations of MER collection processes and times at DDSs to develop best practices." SSA and stated that uniform data collection requirements would impose a burden on DDSs to make software and processing adjustments or to undertake a prohibitive manual process. SSA also stated that in order for it to perform periodic evaluations, most of the DDSs would have to manually track MER and the need for CEs in cases where MER is not received or is not received in a timely manner. (See Appendix D for SSA’s comments.)

In its response, SSA provided technical comments that were incorporated in this final report, as appropriate.

OIG RESPONSE

In its comments to our second recommendation, SSA stated that raising the fee for MER would simply raise the total cost of obtaining evidence without improving compliance by the providers. Our recommendation was not intended to imply an increase in MER payment amounts; nor, was it intended to provide an incentive payment to providers who do not comply with timely submission of MER. Rather, the study should consider paying the current fee to providers who submit MER within 30 days, and paying a lesser fee to providers who exceed the 30-day submission date.

With regard to our third recommendation, we acknowledge SSA’s concern that software and processing adjustments may provide an initial burden on DDSs. However, we do not believe that software modifications or processing adjustments are insurmountable problems given the importance of management information to SSA’s oversight of the disability determination process. Furthermore, as DDSs are converted to the IBM AS/400 computer system, we would expect improvements in the DDS’ ability to collect electronic data accurately and timely.

We acknowledge SSA’s concern regarding the MER collection times reported for the North Carolina DDS. However, we do not concur with SSA’s position that the North Carolina DDS’ data should be excluded from our report. We clearly state in footnote 8 that the North Carolina DDS’ MER collection times are based on MER payment dates instead of receipt dates. Due to unavailable data, we do not know whether the timing differences in the two dates would result in a material difference in our MER collection time analysis. However, in consideration of SSA’s comments, we added the MER collection times exclusive of the North Carolina DDS to footnote 8.

The MER collection process is a critical element of disability claims processing and we strongly believe that SSA needs to improve its oversight of this process. In doing so, SSA should establish uniform data collection requirements for claims processing information, including MER. Without uniform data collection requirements, SSA will encounter problems in analyzing MER data similar those found with the North Carolina DDS data identified in this report. Although the North Carolina DDS had the ability to collect various electronic data information, the absence of uniform data collection requirements resulted in different information being collected by the DDS than what was collected by other DDSs in our review. In its comments to this report, SSA stated that the non-uniformity of data collection and different data systems make it difficult to conduct programmatic reviews of the DDSs. We believe this is further support for implementing our recommendation.We acknowledge SSA’s concern regarding the MER collection times reported for the North Carolina DDS. However, we do not concur with SSA’s position that the North Carolina DDS’s data should be excluded from our report. We clearly state, in footnote 8, that the North Carolina DDS’s MER collection times are based on MER payment dates instead of receipt dates. Due to unavailable data, we do not know if the timing differences in the two dates would result in a material difference in our MER collection times analysis. However, in consideration of SSA’s comments, we added the MER collection times with the North Carolina DDS data excluded to footnote 8.

In its comments to recommendation 2, SSA stated that raising the fee for MER would simply raise the total cost of obtaining evidence without improving compliance by the providers. This recommendation was not intended to imply an increase in MER payment amounts. Nor, was it intended to provide an incentive payment to providers that do not comply with timely submission of MER. Rather, the study might consider paying the current fee to providers that submit MER within 30 days of the request and paying a fee less than the current fee to providers that exceed the 30-day submission date.

In regards to recommendation 3, we acknowledge SSA’s concern that software and processing adjustments may provide an initial burden on DDSs. However, we do not believe that software modifications or minor processing adjustments are insurmountable problems given the importance of management information to SSA’s oversight of the disability determination process. Furthermore, as DDSs are converted to the IBM AS/400 computer system we would expect improvements in the DDS’ ability to collect electronic data accurately and timely.

The MER collection process is a critical element of disability claims processing. As such, we strongly believe that SSA needs to improve its oversight of the MER collection process. In doing so, SSA should establish uniform data collection requirements for claims processing information including MER. Without uniform MER data collection requirements, SSA may not be able to identify and resolve problems related to untimely MER submissions. And, SSA will encounter problems in analyzing MER data similar to the North Carolina DDS data problems identified in this report. Although the

North Carolina DDS had the ability to collect various electronic data information, the absence of uniform data collection requirements resulted in different information being collected by the DDS than what was collected by the other DDSs in our review. In its comments to this report, SSA stated that the non-uniformity of data collection and different data systems make it difficult to conduct programmatic reviews of the DDSs. We believe this is further support for implementing our recommendation.

Appendices

Appendix A

Sampling Methodology and Data Analysis

SAMPLING METHODOLOGY

We randomly selected 10 Disability Determination Services (DDS) to provide electronic data on medical evidence of record (MER) and consultative examination (CE) payments issued during the period of October 1, 1997 through September 30, 1998. The 10 DDSs were Arizona, Delaware, Illinois, Massachusetts, New York, North Carolina, South Dakota, Tennessee, Virginia, and Wisconsin.

We experienced difficulties in obtaining data from the 10 randomly selected DDSs and dropped 4 DDSs from our review. The New York and Tennessee DDSs were dropped because of their participation in recent Social Security Administration (SSA), Office of the Inspector General audits. The South Dakota DDS was dropped because it could not provide electronic data files. The Arizona DDS was dropped because it could not electronically provide all data elements required for the audit. These four DDSs were replaced with the Iowa, Utah, Oklahoma, and Kansas DDSs.

Accordingly, we obtained electronic data on CE and MER payments from the Delaware, Illinois, Iowa, Kansas, Massachusetts, North Carolina, Oklahoma, Utah, Virginia, and Wisconsin DDSs. We also received supporting information including the claimant name and Social Security number (SSN). The Illinois and Virginia DDSs were excluded from the review because they were unable to provide all requested information.

MER COLLECTION TIMES ANALYSIS

The following table shows the MER records included in our analysis and the associated MER payments. We segregated the MER records into six categories based on the elapsed time between the MER request date and the MER receipt date. Our analysis included MER records with a received date between October 1, 1997 and September 30, 1998.

SUMMARY BY STATE DDS OF MER COLLECTION TIMES AND PAYMENTS

MER Receipt Times

Delaware DDS

Iowa DDS

Kansas DDS

Massachusetts DDS

North Carolina DDS

Oklahoma DDS

Utah DDS

Wisconsin DDS

Number of MER Payments

MER Payment Amount

30 days or less

13,001

51,762

45,084

81,105

89,482

35,640

23,552

90,367

429,993

$6,333,368

31 to 60 days

2,970

6,017

5,355

18,960

102,851

24,744

3,178

10,081

174,156

$2,219,956

61 to 90 days

567

917

870

4,321

25,004

4,782

532

1,654

38,647

$485,916

91 to 120 days

157

246

214

1,528

7,472

1,644

185

508

11,954

$150,989

121 to 240 days

111

113

111

1,169

4,835

1,150

131

287

7,907

$99,275

More than 240 days

13

12

6

279

89

208

17

12

636

$8,479

Totals

16,819

59,067

51,640

107,362

229,733

68,168

27,595

102,909

663,293

 

MER RECEIVED AFTER THE DISABILITY DECISION DATE ANALYSIS

We obtained Calendar Year (CY) 1997, CY 1998, and Fiscal Year (FY) 1999 electronic versions of the National Disability Determination Services System (NDDSS). From the NDDSS we downloaded information on the claimant name, claimant SSN, filing date, decision date, and type of decision. We then matched information contained in the FY 1998 DDS data files to the NDDSS data.

The next step was to limit our review to those FY 1998 MER that contained a disability decision date after October 1, 1997. Once this step was complete, we compared the MER received dates to the disability decision dates and selected those MER with the latest disability decision date.

Appendix B

Status of Prior Recommendation

SOCIAL SECURITY

MEMORANDUM

Date: March 19, 1997

To: David C. Williams
Inspector General

From: John J. Callahan
Acting Commissioner of Social Security

Subject: Office of Inspector General Draft Report, "The Social Security Administration's Payment for Medical Evidence of Record Obtained by State Disability Determination Services" (A-07-95-00833)--INFORMATION

We appreciate the opportunity to comment on this draft audit report since evidence collection and related issues are so vital to disability processing time improvements.

SSA, in the Disability Process Redesign, plans to undertake a thorough reevaluation of policies and procedures relative to the collection of evidence in support of disability applications. This reevaluation will include a thorough study of the relative effects of multiple factors on such performance measures as processing time and consultative examination purchase rates (and dollar amounts). Untimely submission of medical evidence of record (MER) is but one factor in this complex of issues that SSA needs to consider. For example, at least some of the delay in MER development and receipt is mail time, from the DDS to the source, and from the source back to the DDS. Facsimile MER and other forms of electronic transmission of MER being pursued by SSA offer promise to reduce MER processing time within the current MER payment system.

While we concur with your view that payment for MER should serve as an incentive for timely and responsive submission of medical evidence, our evaluation, which should be completed within 9 months, is designed so as to take a broader view of MER; therefore, we are not prepared at this time to address your specific recommendation for statutory change. If the results of our evaluation show that statutory changes are needed, SSA will then propose the necessary legislation.

Our technical comments on the report are attached for your consideration. Staff questions may be directed to Dan Sweeney on extension 51957.

CIN: A-07-95-00833 Report The Social Security Administration's Payments for Medical Evidence of Record Obtained by State Disability Determination Services

Recommendation: Re-evaluate its policy for paying for MER. As part of this re-evaluation, we suggest that SSA, for a specified time period, have selected DDSs capture the time between the initial MER request.

Status: Status - June 2000

The Office of Disability (OD) planned to reevaluate policies and procedures on the collection of Medical Evidence of Record (MER), including payment for it and the amount of time involved. The study was originally designed to obtain: data on innovations by the Disability Determination Services (DDS) to obtain MER quickly; input from major medical organizations/stakeholders on their opinions regarding non-payment for MER received more than 30 days after request; statistics on the incidence of MER received more than 30 days after request; and Disability Examiners' analysis of individual cases to determine if MER received more than 30 days after request was material to the determination. The DDSs have been unable to participate in the latter two parts of the study due to backlogs and workload pressures caused by high application rates, Drug and Alcohol Addiction reevaluations, Continuing Disability Reviews, childhood reviews, and OIG installations. Parts one and two of the study are complete. OD planned to provide the OIG with the data they now possess by May 31, 1999. During the period just before OD was to report, OIG announced a new audit (21999045) that is examining the entire MER process. OD has been in contact with the IG staff and has learned that the IG has completed the data gathering phase of that audit; and current plans envision a December 2000 release of the audit report . The data collected for that audit is more current than that which OD could have provided. Given that OD does not want to duplicate OIG's efforts, OD will now attempt to evaluate the IG's findings and new recommendations when they are released and determine if an additional study is required at that time. See recommendation number 21995027-1 for related information. (Williams--50380).

Appendix C

Social Security Administration’s (SSA) Computer Conversion Timeline for Disability Determination Services (DDS)

SSA Tier

Levy & Associates Group

DDS Number

DDS Client

Software Implementation Start Date

Software Implementation End Date

1

1

1

Wisconsin

October 2000

June 2001

1

1

2

Indiana

November 2000

August 2001

1

1

3

Georgia

December 2000

September 2001

1

1

4

Arkansas

December 2000

September 2001

1

2

5

Federal

April 2001

January 2002

1

2

6

Oklahoma

July 2001

April 2002

1

2

7

Iowa

August 2001

May 2002

1

2

8

North Carolina

September 2001

June 2002

1

2

9

Florida

September 2001

June 2002

2

3

10

Idaho

April 2002

January 2003

2

3

11

Arizona

June 2002

March 2003

2

3

12

Massachusetts

July 2002

April 2003

2

3

13

Kansas

July 2002

April 2003

2

4

14

Rhode Island

February 2003

November 2003

2

4

15

South Dakota

April 2003

January 2004

2

4

16

Connecticut

April 2003

January 2004

3

4

17

District of Columbia

March 2003

December 2003

3

4

18

Washington

March 2003

January 2004

3

5

19

Kentucky

November 2003

August 2004

3

5

20

New Mexico

February 2004

October 2004

3

5

21

Louisiana

February 2004

October 2004

3

5

22

Montana

January 2004

October 2004

3

6

23

Colorado

February 2004

October 2004

3

6

24

Vermont

September 2004

June 2005

3

6

25

Michigan

November 2004

August 2005

3

6

26

Puerto Rico

November 2004

August 2005


  • This plan is based on starting the first step of the software migration in Wisconsin DDS on October 1, 2000.
  • This plan assumes a "module (or group of modules) at a time" process and estimates an implementation and roll out period for each module for each DDS.
  • The "Software Implementation Start Date" is the start of Levy & Associates consulting with the DDS.
  • The "Software Implementation End Date" is the estimated completion for each DDS including roll out of the last module(s).
  • Source of Timeline: Deputy Commissioner for Systems, Office of Systems Requirements.

Appendix D

Agency Comments

COMMENTS ON THE OFFICE OF THE INSPECTOR GENERAL (OIG) DRAFT REPORT, "REVIEW OF MEDICAL EVIDENCE OF RECORD (MER) COLLECTION PROCESS AT STATE DISABILITY DETERMINATION SERVICES (DDS)"

(A-07-99-21003)

We appreciate the OIG’s efforts in conducting this review. Before responding to the specific recommendations, we want to note our concern with the information presented in the section "The Current MER Collection Process" on pages 4 and 5 of the draft report. We believe that inclusion of the data from the North Carolina DDS results in an inaccurate representation of MER collection times. As the footnote on page 5 indicates, the North Carolina DDS reports the date the MER was paid for, not the date the MER was received. The subject draft report treats these dates as if they were the date the MER was received. Therefore, the North Carolina data should be excluded from the report with a potential increase in the percentage of MER received in 30 days from 64.8 percent to 78.5 percent.

Finally, in "Background" the OIG states, "If MER is not received within 10 calendar days from the follow up request, the DDS can purchase a CE—an expensive and time-consuming process." The North Carolina DDS has the lowest CE rate in the Atlanta Region, and at 33.2 percent for fiscal year 2000, ranks 37th among the States in terms of percentage of CEs requested for cases processed. This actual experience of the North Carolina DDS seems to further indicate that the data for that State should not be considered.

Our comments on the recommendations are provided below. Additionally, several technical comments are included that we believe will improve the accuracy and content of the report.

Recommendation 1

Pursue options for improving MER collection times at DDSs experiencing problems in receiving MER within 30 days from the date of the request. This should include sharing best practices of DDSs that have been innovative in obtaining MER timely.

Comment

We agree. In June 2001, SSA will begin conducting a 2-year pilot, "Specialized Medical Evidence of Record Professional Relations Officer." The following States will be participating: Puerto Rico, Florida, Illinois, Louisiana, Nebraska, and Idaho. The purpose of the pilot is to determine if assigning one professional relations officer in each DDS to duties related solely to MER retrieval will promote the timely receipt of quality MER and ultimately decrease consultative examination (CE) costs. Also, we already share best practices in many subject areas, including MER collection, with Professional Relations Officers at the annual National Professional Relations Conference and in the publication, "The National Professional Relations Bulletin."

Recommendation 2

Conduct a study to determine whether savings in CE costs could be realized by providing a financial incentive to medical providers who submit MER within 30 days from the date of the request.

Comment

We disagree. In calendar year 2000, an SSA focus group on improving MER collection determined that "The amount of the fee paid for MER is not a critical issue. While some physicians do feel their time is more valuable than the remuneration provided by SSA... by and large they view this as a necessary consequence of working with their patient."

The report should note that the rates SSA pays for MER are far below the amounts paid for such reports in the private market, so there is currently very little financial incentive for treating source provision of MER. Even so, much of the requested MER (over 78 percent in this review, as noted in our opening comment) is submitted within 30 days. The recommended approach could simply raise the total cost of obtaining evidence without improving compliance by the providers. If we raised the pay out to medical sources for MER for a study, it could prove difficult to return to today's reimbursement amounts. Additionally, current high priority workloads, which preclude the manual tracking required for such a study, and the differences among the DDS systems available to track the effects of any monetary incentives make conducting a study problematic.

Recommendation 3

Improve oversight of the DDS MER collection process by: a) Developing uniform MER data collection requirements for DDSs and b) performing periodic evaluations of MER collection processes and times at DDSs to develop best practices.

Comment

We disagree. As the OIG draft report notes, the DDSs use multiple, disparate and incompatible computer systems and software. Uniform data collection requirements would impose a burden on the DDSs to make software and processing adjustments or to undertake a prohibitive manual process. In addition, we do not believe that uniform data collection requirements will improve DDS efforts in obtaining timely MER. Knowing that a DDS waits an extra 10 to 20 days to receive evidence from a particular source is not helpful. It would be necessary to know why. The result would be a large data collection burden without indications that it would result in a significant payoff.

In order for SSA to perform periodic evaluations, most of the DDSs would have to manually track MER and the need for CEs in cases where MER is not received or is not received in a timely manner. This tracking must be done by someone with intimate knowledge of the case included for study and cannot be automated or undertaken manually in the foreseeable future because of other workload pressures.

We believe that our efforts should instead continue to focus on obtaining timely MER. The DDSs are already required to make every reasonable effort to obtain MER from treating sources. Each DDS has treating sources who present unique challenges to their successfully meeting that requirement, and they have worked out various ways to get the best responses possible from these treating sources. We will continue to share their experience and best practices, regarding MER and many other subject areas, with Professional Relations Officers at the annual National Professional Relations Conference and through the publication, "The National Professional Relations Bulletin." In addition, the Specialized MER Professional Relations Officer Project may give us additional insight into the effects on overall processing time of devoting staff to obtaining MER.

Appendix E

OIG Contacts and Staff Acknowledgements

OIG Contacts

Rona Rustigian, Acting Director, Disability Program Audit Division (617) 565-1819
Mark Bailey, Deputy Director, (816) 936-5591

Acknowledgements

In addition to those named above:

Ron Bussell, Auditor-in-Charge
Ken Bennett, Auditor

For additional copies of this report, please contact the Office of the Inspector General’s Public Affairs Specialist at (410) 966-5998. Refer to Common Identification Number A-07-99-21003.