Key Issues > High Risk > Improving and Modernizing Federal Disability Programs
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Improving and Modernizing Federal Disability Programs

Management attention and efforts are needed across the government to ensure that disability programs provide benefits in a timely manner, reflect current ideas about disability, and achieve positive employment outcomes.

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An estimated one in six working-age Americans reported a disability in 2010. Many of these Americans need help finding or retaining employment, or rely on cash benefits if they cannot work. However, federal disability programs struggle to meet their needs.

Three of the largest federal disability programs—two managed by SSA and one by VA—dispensed about $270 billion in cash benefits to 21 million people with disabilities in fiscal year 2017. Both agencies struggle to manage their workloads, specifically appealed claims.

In addition, when determining whether individuals qualify for disability benefits, SSA and VA rely on outdated criteria. While both agencies have efforts underway to update medical or occupational information used to make eligibility decisions, they continue to rely on information that can be decades old.

In addition to the aforementioned cash benefit programs, we previously identified over 40 programs managed by nine different agencies that provide a patchwork of employment support for people with disabilities. We reported in 2012 that these programs lacked a unified vision, strategy, or set of goals to guide their outcomes.

We designated improving and modernizing federal disability programs as high risk in 2003.
 

Improving and Modernizing Federal Disability ProgramsSince our 2017 High-Risk Report, our assessment of ratings for all five criteria remains unchanged.

Both the Social Security Administration (SSA) and the Department of Veterans Affairs (VA) made mixed progress in addressing their claims workloads. Leadership of both agencies demonstrated commitment to reducing backlogs in their appeals workloads. However, these backlogs remain large, and persistent shortcomings in agency plans and capacity challenges could hinder progress.

Both SSA and VA demonstrated leadership commitment toward updating the criteria on which their disability determinations are made. However, action plans for both lack details on some necessary tasks that could result in delays in updating disability criteria now and in the future.

The Office of Management and Budget (OMB) reported that the administration is pursuing additional legislative and administrative changes and demonstration projects to increase workforce participation for people with disabilities. However, many efforts are still underway, and OMB continues to lack a larger vision for coordinating disability programs, which includes creating appropriate, government-wide goals and strategies.
 


Managing Disability Claims Workloads (SSA)

Improving and Modernizing Federal Disability ProgramsSince our 2017 High-Risk Report, our assessment of ratings for all five criteria remains unchanged.

Leadership commitment: met. SSA leadership set a goal to process appeals within 270 days by fiscal year 2022, and made reducing its disability appeals backlog a key initiative in its fiscal year 2019 annual performance plan.

Capacity: partially met. SSA continues to face capacity challenges in addressing its disability appeals backlog. SSA’s 2017 disability appeals plan called for increased hiring and other measures to reduce disability appeals backlogs and improve timeliness. SSA has also transferred appeals cases between offices to better utilize its capacity to make decisions. However, we reported in July 2018 that SSA lacks metrics to assess the effect of transfers on timeliness, and SSA agreed with our recommendation to implement such metrics. We also reported that SSA hiring freezes could affect its capacity.

Action plan: partially met. SSA’s 2017 appeals plan addresses large disability appeals workloads through improvements in information technology and business processes, and through increased hiring. However, it is too early to determine the extent to which this plan will allow SSA to achieve its goal of processing claims within 270 days. More broadly, SSA’s Vision 2025 strategic plan recognizes the need to provide a number of different service delivery methods, including online. However, in 2017 we reported that that SSA had not developed performance measures for or analyzed common issues with online services. SSA agreed with our recommendations to do so, but had not completed its efforts as of January 2019.

Monitoring: met. SSA continues to monitor and report on the timeliness of processing its initial disability claims and appeals workloads.

Demonstrated progress: partially met. While SSA has seen a decline in applications for benefits in recent years, SSA’s inventory of initial disability claims increased somewhat from 523,000 at the end of fiscal year 2017 to 565,000 at the end of fiscal year 2018. The number of pending appeals declined from approximately 1.1 million at the end of fiscal year 2017 to 858,000 in fiscal year 2018, and average processing times improved from 605 days to 595 days during this same period. However, additional progress is needed if SSA is to meet its goal of processing appeals within 270 days by the end of fiscal year 2022.


Managing Disability Claims Workloads (VA)

Improving and Modernizing Federal Disability ProgramsSince our 2017 High-Risk Report, our assessment of ratings for all five criteria remains unchanged.

Leadership commitment: met. VA has maintained leadership focus on managing initial disability claims and appeals workloads through various initiatives to improve benefits processing and reduce backlogs. Enhancing and modernizing VA’s disability claims and appeals processes are goals in its 2018–2024 strategic plan.

Capacity: partially met. VA has continued building the capacity to process initial disability claims, such as using an electronic system to distribute claims ready for decisions to available staff. On appeals, VA is reforming its process, onboarding hundreds of new staff, and implementing new technology. However, as we reported in March 2018, VA’s appeals planning does not provide reasonable assurance that it will have the capacity to implement the new process and manage risks. VA agreed with our recommendation to better assess risks associated with appeals reform.

Action plan: partially met. VA continues to implement plans to reduce the initial disability claims backlog. For appeals reform, VA submitted its appeals plan in November 2017 and provided several progress reports throughout 2018. In December 2018, we reported that while VA had taken steps, it had not fully addressed our recommendations on planning the new appeals process and assessing its efficacy. As of December 2018, VA officials said they continue to address our recommendations.

Monitoring: partially met. VA monitors the timeliness of initial disability claims and legacy appeals, and has set timeliness goals for three of five appeal options under the new process. VA’s plans also signal how it intends to monitor the allocation of staff for concurrent workloads in its legacy and new appeals processes. However, as of December 2018, VA had not established complete metrics and interim goals for all appeal options, and it was unclear how and when VA will monitor implementation and efficacy of the new appeal process.

Demonstrated progress: partially met. VA reported it reduced the backlog of initial disability claims from 611,000 in March 2013 to just over 85,000 in August 2018. However, VA’s Office of Inspector General reported in September 2018 that VA overstated its performance by only reporting about 79 percent of the backlog. For appeals, VA addressed some gaps in its plan for implementing appeals reform, in accordance with our 2017 and 2018 recommendations, and has prioritized processing of legacy appeals. However, as of August 2018, VA still had a backlog of over 400,000 appeals.
 


Updating Disability Benefit Eligibility Criteria (SSA)

Improving and Modernizing Federal Disability ProgramsSince our 2017 High-Risk Report, ratings for the action plan criterion regressed while the other four remain unchanged.

Leadership commitment: met. SSA has maintained leadership focus on updating both the medical and occupational criteria used to determine eligibility for Social Security disability benefits.

Capacity: met. Consistent with our past recommendations in June 2012, SSA continues to leverage the Bureau of Labor Statistics to develop an occupational information system (OIS) to replace SSA’s outdated Dictionary of Occupational Titles to assist in making disability determination decisions.

Action plan: partially met. SSA has developed project plans to guide the completion of OIS and update its medical criteria now and in the future. However, we are lowering SSA’s prior rating of met to partially met. Since our 2017 high-risk update, SSA told us that it began work on its Vocational Regulations Modernization (VRM) initiative—an effort SSA says will update its vocational rules to reflect labor market changes—but has not released a plan or any supporting documentation related to VRM.

Monitoring: met. SSA continues to monitor progress toward updating its medical criteria and has a timetable against which to monitor OIS development.

Demonstrated progress: partially met. A September 2018 status report from SSA stated that the agency promulgated final regulations for 13 of the 14 body systems (listings of diseases and disorders in each part of the body) and proposed a rule for comprehensively updating the last body system. SSA also reported that, once the final rule is complete, it will begin targeting updates to body systems per its plans to review and update them every 3 to 5 years. For OIS, SSA reported it planned to complete its final year of occupational data collection in 2018, and expects to start using it in deciding disability claims in calendar year 2020.
 


Updating Disability Benefit Eligibility Criteria (VA)

Improving and Modernizing Federal Disability ProgramsSince our 2017 High-Risk Report, ratings for the action plan and monitoring criteria regressed while the other three remain unchanged.

Leadership commitment: met. VA has sustained leadership focus on updating its Veterans Affairs Schedule for Rating Disabilities (VASRD)—used to assign degree of disability and compensation levels for veterans with military service-connected injuries or conditions—to reflect advances in medicine and labor market changes.

Capacity: partially met. In August 2017, VA officials told us that it had taken actions to hire more staff for the regulations updates and leverage outside researchers to evaluate veterans’ loss of earnings in the current economy. However, as of September 2018, the agency was still working to hire these staff. Moreover, VA’s current earnings loss study covers only 8 of over 900 diagnostic codes and 2 of 15 body systems. VA needs to continue its current hiring and earnings loss planning efforts to ensure it has the capacity to comprehensively update the VASRD.

Action plan: partially met. As of August 2018, VA’s efforts to update the VASRD included new plans to conduct earnings loss studies for eight diagnostic codes under two body systems. The agency intends to determine whether its current approach for evaluating earnings loss is applicable to updating other diagnostic codes. However, we are lowering VA’s prior rating of met to partially met because its August 2018 updated plan, issued since our 2017 high-risk update, provides limited detail on key planned activities. For example, VA’s plans do not indicate how and when VA will assess the applicability of its current approach, and does not include plans for updating earnings loss information for the remaining diagnostic codes and body systems.

Monitoring: partially met. According to VA officials, VA continues to track its progress toward finishing the medical updates by fiscal year 2020 and has updated its project plan to reflect delayed timeframes. However, we are lowering VA’s prior rating for this criterion from met to partially met because VA’s plans have changed since our last update, and although it is conducting a study to update earnings loss information for some diagnostic codes and body systems, its plan does not include timetables for monitoring these or future updates to earnings loss information.

Demonstrated progress: partially met. VA reported that as of December 2018, it promulgated final regulations for 6 of 15 body systems, proposed regulations for 2, and is reviewing draft regulations for the remaining 7. However, VA has fallen about 4 years behind in its efforts to fully update the VASRD and has not completed earnings loss updates.
 


Programs with Unified Strategies and Goals  (OMB)

Improving and Modernizing Federal Disability ProgramsSince our 2017 High-Risk Report, our assessment of ratings for all five criteria remains unchanged.

Leadership commitment: partially met. In September 2018, OMB reported that the administration is pursuing several legislative changes, administrative actions, and demonstration projects intended to either improve collaboration across multiple federal agencies or address the relatively low levels of employment of people with disabilities. However, OMB continues to lack a larger vision for coordinating over 40 programs that support employment of people with disabilities, and establishing overarching goals to improve employment of people with disabilities in both federal and non-federal sectors.

Capacity: partially met. According to OMB, the administration has proposed continued funding for several interagency demonstration projects that have potential to inform the development of reasonable goals and measures for federal programs that support employment for people with disabilities. However, it is too early to conclude whether these demonstrations will inform government-wide goals and measures, and OMB has not indicated that it will build capacity for establishing government-wide goals and improving agency coordination.

Action plan: not met. OMB has yet to establish government-wide goals and associated plans for the employment of people with disabilities outside of the federal sector.

Monitoring: partially met. Since 2017, some progress has been made toward monitoring the hiring of individuals with disabilities in the federal sector. For example, in 2018, OMB reported that it would have sufficient data by the end of the year to assess progress toward a goal the Department of Labor set in 2013 that individuals with disabilities should comprise 7 percent of the workforce for federal contractors and subcontractors. 

Demonstrated progress: partially met. While progress has been made on previous goals related to federal-sector hiring, OMB has yet to develop government-wide goals for all federal programs that support employment of people with disabilities across all sectors.
 

Managing Disability Claims Workloads (SSA)

Since 2003, we have made 35 recommendations related to this high-risk segment. As of December 2018, 10 remain open.

SSA should continue to make and implement plans for managing its workloads. This includes continuing to:

  • refine and implement plans to address its disability appeals backlog, and
  • operationalize its long-term strategic plan to ensure that the agency is well positioned to serve its customers in the future.

Managing Disability Claims Workloads (VA)

Since 2003, we have made 65 recommendations related to managing VA workloads. As of December 2018, 13 remain open.

VA should continue updating and implementing plans to address its initial disability claims and appeals workloads at both levels. This includes:

  • maintaining focus on initial claims and appeals processing,
  • ensuring VA has detailed plans for creating capacity and reforming its appeals process, including modifications to information technology systems, and
  • determining how well the new process is performing relative to the legacy process.

Updating Disability Benefit Eligibility Criteria (SSA)

Since 2003, we have made seven recommendations related to this high-risk segment, all of which were implemented.

SSA should continue to develop and implement plans to update its disability criteria. Specifically, SSA should:

  • develop an action plan for implementing its VRM initiative that addresses when and how updates to its vocational rules will align with implementation of OIS, and
  •  finalize its comprehensive updates of medical criteria and begin using occupational data collected through its OIS.

Updating Disability Benefit Eligibility Criteria (VA)

Since 2003, we have made three recommendations related to modernizing disability criteria, all of which were implemented.

VA should continue to develop and implement plans for updating medical criteria and earnings loss information. This includes:

  • ensuring sufficient resources are dedicated to this effort,
  • developing a viable plan for monitoring progress in updating earnings loss information, and
  • refining plans to revisit criteria at least once every 10 years.

Programs with Unified Strategies and Goals (OMB)

As of December 2018, two actions related to this high-risk segment had not been fully addressed from our 2012 annual report on opportunities to reduce fragmentation, overlap, and duplication for the federal government.

Moving forward, OMB should develop a set of unifying government-wide goals for employment of people with disabilities. OMB’s efforts to this end might benefit from an action plan. In general, agencies can make progress in addressing high-risk areas by developing action plans that identify and analyze the root causes of problems, and identify critical actions and outcomes to address those root causes.

 

Looking for our recommendations? Click on any report to find each associated recommendation and its current implementation status.
  • portrait of Elizabeth H. Curda
    • Elizabeth H. Curda
    • Director, Education, Workforce, and Income Security
    • curdae@gao.gov
    • (202) 512-7215