National Council of Disability Determination Directors
September 18, 2002

Address by
Hal Daub, CHAIRMAN,
SOCIAL SECURITY ADVISORY BOARD

Social Security. Those of us who work with this program use those words so often that they tend to become just a couple of words. But they are much more than just a couple of words. Our Nation, our society, has entrusted us with the responsibility of bringing to its individual members a reasonable level of economic security in the face of the common risks of old age, disability, and death.

In many, many ways the Social Security program is one of this country's great success stories. The basic insurance program and the supplemental security income program provide economic security protection to essentially the entire population of our Nation. About 50 million people receive benefits from these programs every month.

But, precisely because of this program's magnitude and importance, it needs to be continually worked at to assure that it meets its ongoing responsibilities as well as the challenges of changing conditions in the society it serves. In 1994, Congress enacted legislation making the Social Security Administration a separate agency within the Federal Government. At the same time it created another independent entity, the Social Security Advisory Board. The Board's mandate is continually to review the Social Security programs and to make recommendations to the Administration and the Congress about how those programs can best fulfill their responsibilities to ensure economic security and to provide a high level of quality in serving the public.

The disability aspects of Social Security are clearly one of our greatest challenges. The Social Security Advisory Board has devoted a large portion of its efforts over the past six years to analyzing and examining that program. The Board has traveled to every region in the country to see how the program operates and to get the views of those who administer it at all levels. We have made recommendations for needed program improvements in many of our reports. In January of last year, we issued a report on the future of Social Security's disability programs and the need for fundamental change.

The structure for administering the Social Security disability program is inherently difficult. A disabled individual seeking benefits approaches his local Social Security field office to file a claim. In many cases, that visit to the field office may be pretty much all that he has to do. He may not even be aware of the involvement of a State agency. All he knows is that, after a period of time, his benefits will start to arrive and continue coming month after month. But in many other cases, he is beginning a journey that will take his application through a maze of different and somewhat independent reviews that may stretch out for many months or even years before he has a final decision.

We all know the possible steps that are involved. The Social Security field office. The state agency initial and reconsideration units. The regional office quality reviewers. The administrative law judge in the regional hearings office. The Appeals Council in Virginia. And, in some cases - probably far too many cases -- the Federal court system.

Each of these steps was put into this process for a good reason. They exist to assure fairness and accuracy. At each of these steps, there are dedicated, hard-working individuals who do their very best to arrive at the right decision in each claim they handle.

But, stepping back from the individual elements, it is clear that in too many cases the system as a whole does not look very much like the efficient, effective, and fair process that the words "Social Security" would seem to promise to those who pay taxes to support the program and to those who find themselves in need of its benefits.

Clearly the most striking problem that the Board found is the problem of inconsistency. The disability program is a national program. It is governed throughout the country by the same body of law. There have been relatively few changes to the statutory definition of disability over the nearly half-century of the program's existence, and that definition really creates a pretty clear-cut objective: you are eligible for benefits if, and only if, you have a medical condition which, given your vocational capabilities, precludes any substantial employment. Now, we all know that applying that definition to the myriad particular circumstances of individual applicants is not a simple task. But it certainly should be possible to develop and implement policies and procedures that apply that definition consistently in different parts of the country, throughout the different levels of administration, and from one year to the next.

That does not seem to be the reality. There are large differences in allowance rates among the various parts of the country. There has been a continuing substantial rate of reversal at the hearings level. And rates of award and termination have fluctuated substantially over time.

Now, it is true that this is a large and diverse nation. And there are changes in conditions that can have an important impact on the disability program. There are, for example, developments in medical treatment and rehabilitation technology. The economy goes through cycles that can lead more or fewer people to apply for benefits. We see changes in the types of work available and, increasingly, in the willingness of employers to tailor jobs to individual capabilities.

All of these very real factors, make us understand that we should not expect and will never see absolute consistency in the disability programs. But that does not mean that there is no problem. Even taking all of these factors into account, we see a level of inconsistency that is impossible to accept. And we do not have the type of quality management apparatus that would tell us with some degree of confidence what are the real causes of this inconsistency. We need to, but do not, know how much of it is really appropriate and unavoidable. We need to, but do not, know how much of it is caused by structural defects in the way the program is administered or by inadequate resources to let those administrative structures carry out their responsibilities effectively. We need to, but do not, know how much of the inconsistency is attributable to inadequately formulated and poorly articulated policies-policies that unnecessarily aggravate the subjectivity of the determination process.

While we do not know nearly enough about exactly how much and in what ways these factors contribute to making the disability process less fair and consistent and accurate than it ought to be, the Advisory Board is convinced that all of them are problems that are present and that need attention. We are convinced of that, in part, because we see indicators that seem impossible to just explain away. In the period from 1990 to the present we went through a variety of economic conditions. During this period, legislation was enacted that, if anything, cut back on the program by addressing the issue of addiction and alcoholism. Special funding was provided which increased continuing disability reviews. Yet the number of persons on the disability insurance rolls grew steadily and grew substantially. In 1990, out of every 1000 who were insured for disability insurance benefits, 25 were on the benefit rolls. By the beginning of this year, that number had grown to 37 out of 1000. That is about a 50% increase.

But it is not just the statistical indicators that convince us that the program needs fundamental reform in management and structure and resources and policies. The most convincing evidence is the clear sense of that need that the Board has gotten from you. And when I say you, I don't mean simply the State agencies - although you have been a very important element in the Board's review of the program - but I also mean your colleagues in all parts of the administrative structure. There are, of course, differences of perspective and emphasis in different parts of the organization. And yes, as you know, there is sometimes some finger pointing. That is to be expected when people who are working as hard as they can to do the job right are frustrated to learn that somehow the overall system is still not living up to what they and others expect of it.

Out of our many visits with you and your colleagues in other parts of the process, the Board has been able to identify what it believes to be the major problems. We have made a number of recommendations for specific changes that might be considered to improve the program. But in particular, we have concluded that there are certain very major challenges that must be met.

You can't fix problems if you don't know what is causing them. One of the Board's most important recommendations is for the establishment of a new quality management system. This is not a question of simply emphasizing the importance of quality. We have met with people at all levels of the program. They already know and appreciate and endorse the importance of quality. Certainly, they are sometimes unable to deliver the ideal level of quality because of production pressures and resource limitations. But they, more than anyone, find those situations frustrating. Of course, a part of any quality management system is to nurture and encourage quality administration, but it must do much more than that. It must provide information that can be used to improve the quality of decision-making. It must help to answer the questions of why do the problems we see in the program exist and how can we resolve them. Why are backlogs developing? Why do some claims take inordinately long to process? Are some policies in need of review because they seem to be more inconsistently applied than the norm? Are some policies being applied differently at different levels of adjudication, and does that look like a training question or a policy development question? This type of quality management system is not in place now. It is going to be a challenge to develop. And it will not be resource free. But without it, reform is reduced pretty much to a guessing game.

Another major area that the Board has identified as needing more attention is the area of policy development. Even though the statutory definition of disability has been quite stable over the history of the program, there have been many policy changes articulated through rulings and regulations in response to such events as court decisions and developments in medical science. This policy development function is absolutely crucial to the proper functioning of the program. First of all, policy changes must faithfully advance conformity with the statutory definition of disability. They must be made in ways that will maintain and, if possible, improve the level of consistency and fairness in decision-making throughout the system. And they must be operationally sustainable in this program, which has to deal with massive numbers of cases. It is not at all clear that these concerns have been adequately addressed in policy development in the past. If we are to see fundamental improvement in the disability program, this policy making function has to be given a prominent role. And it has to be structured in a way that allows for full participation by each of the levels of program administration. If the Board has learned one most important lesson in its six years of operation, it is that knowledge and wisdom about what works and what doesn't cannot be found at any one location. Better policy development can improve the program, but that will not happen without sustained and significant input from all parts of the program.

And then there is the issue of resources. This is always a difficult area because needs often seem infinite and resources never are. At this particular moment that issue is, perhaps, foremost in your mind. Claims are coming in faster than anticipated, backlogs are growing, and relief looks somewhat uncertain. I know you will be working with the Administration on these immediate issues during the remainder of this conference. The Advisory Board certainly recognizes the problem of inadequate resources. It has and will continue to try to be helpful in finding relief from the immediate problems. On a longer range basis there is an obvious need to have a better match between program requirements and resources. The legislation making Social Security an independent agency required that budgets be based on a comprehensive workforce plan. With the coming increase in the aging population, which will certainly increase the demands on disability, it is absolutely essential that adequate resources be planned for and made available.

It is the function of an advisory board to make suggestions for improvements, and that inevitably leads to a focus on problem areas. I would like, however, to conclude on a somewhat more upbeat note. There are several rays of hope out there. The very fact that Congress established a Social Security Advisory Board, I take as a sign that they saw the need for improvement and wanted an independent voice that could concentrate on that need and provide them and the Administration with serious, well-informed recommendations. We are very encouraged by our contacts with Commissioner Barnhart. As you probably know, she was our colleague on the Board for several years before being appointed Commissioner. We believe she is setting about energetically to undertake a number of needed reforms. And we are encouraged that there are signs of serious Congressional interest in improving this program. As you know, the House Social Security Subcommittee held hearings this June focusing on the challenge of strengthening the disability program. In preparing this address, I re-read your excellent testimony at that hearing, so I am quite aware that much of what I have just said can be characterized as "preaching to the choir." Still I think it is important that we all continue to focus on these issues and to work together to achieve the program improvements we all know are needed. I congratulate you for the good work you do for the people of this country each and every day and for the contributions your thoughtful analysis makes to improving the disability program. I urge you to keep it up. And I thank you very much for inviting me here today.