FY 2001 APP Overview

Enhancements to APP Document

For FY 2001, we enhanced our APP to emphasize several important areas, including the following:

• In Section IV, we expanded the discussion of major environmental factors that may impact SSA's performance and our strategies to mitigate them. We also described how information technology and SSA's capital investments support our strategic goals and initiatives.

• We added charts throughout Section V to graphically show that most of our performance trends are in the right direction with us meeting, surpassing, or at least approaching our annual performance targets.

• We expanded Section VI on Verification and Validation to better demonstrate the validity and reliability of the data used to report our performance.

• In Sections VIII and IX, we summarized the performance goals that we use to track our improvement in managing the Social Security and Supplemental Security Income Disability Programs, and the Hearings Process.

• We added Appendix 4, which displays the schedule of evaluations to be undertaken or completed during FY 2001 and which directly relate to performance goals and indicators in the APP.

• We added Appendix 5, which details the action plans we are pursuing and the major performance measures we use to track our progress in resolving major management challenges identified by the General Accounting Office and SSA's Inspector General.

SSA's Budget Account Structure and APP Alignment

The "Introduction" section of this document explained that SSA is responsible for three major programs:

• Old-Age and Survivors Insurance (OASI);

• Disability Insurance (DI); and

• Supplemental Security Income (SSI)

SSA also provides support for the Medicare, Medicaid, and Black Lung programs.

The following discussion provides a brief overview of SSA's unique budget account structure, which has evolved over a number of years in response to changes in SSA's responsibility.

Budget Account Structure

SSA's budget is best viewed in two distinct segments--the program budget and the administrative budget. In the simplest possible presentation, the program budget covers benefit payments to individuals, while the administrative budget covers the costs of accomplishing SSA's mission.

Under the Budget Enforcement Act, the program budget is considered part of the entitlement portion of the Federal budget. SSA's administrative budget is considered discretionary spending and, as such, must compete for scarce resources with the budgets of other Federal agencies within an overall spending limit.

Eight separate accounts comprise SSA's overall budget. These accounts are generally categorized by the type of appropriation from which they are funded, as displayed below.

SSA's permanent appropriations provide the funding needed to pay all entitled Social Security beneficiaries automatically; the amount spent each year is not determined through the annual appropriations process. Therefore, Social Security retirement, survivors and disability insurance benefits increase automatically as additional persons meet eligibility requirements and as benefit levels increase based on cost-of-living adjustments. These OASDI trust fund accounts are considered off-budget. SSA's permanent appropriations fall under the purview of the House Ways and Means and Senate Finance Committees.

SSA's annual appropriations are those for which Congress approves a specified funding level through legislation each fiscal year and are under the purview of the House and Senate Appropriations Committees.

A very brief sketch of each SSA budget account follows.

Old-Age and Survivors Insurance (OASI) Trust Fund and Disability Insurance (DI) Trust Fund: These accounts receive revenues from Social Security contributions and disburse benefit payments (entitlements) upon retirement, disability, or death to insured workers and their families. Social Security benefit payments make up the overwhelming bulk of SSA's overall budget. These accounts are permanent appropriations.

Supplemental Security Income (SSI): The activities of this annual appropriation involve:

• Providing means-tested Federal payments for aged, blind and disabled persons;

• Providing vocational rehabilitation services and research funding; and

• Reimbursing the Social Security trust funds for the SSI program's share of SSA's administrative expenses.

Special Payments for Disabled Coal Miners (Black Lung): SSA makes payments of cash benefits to certain coal miners who are disabled due to coal workers' pneumoconiosis (black lung) and to their widows and certain other dependents.

Special Benefits for Certain World War II Veterans: Title VIII of the Social Security Act, enacted December 14, 1999 as part of the Foster Care Independence Act of 1999, provides a monthly cash payment to certain World War II veterans. To be eligible for the payment the individual must meet the following conditions:

• Have served in the military forces of the United States or the Philippines during World War II;

• Be eligible for SSI in December 1999 (the month of enactment);

• Be at least 65 years old;

• File an application for benefits; and

• Reside outside the United States.

Payments to Social Security Trust Funds (PTF): This account provides general fund payments to the Social Security trust funds intended to reimburse the trust funds for certain benefits or administrative expenditures (e.g., special payments for certain uninsured persons and costs associated with pension reform) that are chargeable to Federal funds.

Office of the Inspector General (OIG): The OIG account is an annual appropriation that funds the administrative expenses of the Inspector General. Financing is provided from both the Social Security trust funds and general revenues to reflect the fact that OIG monitors the Social Security, SSI and Black Lung programs.

Limitation on Administrative Expenses (LAE): The Limitation on Administrative Expenses, SSA's basic administrative account, is an annual appropriation and is financed from the Social Security and Medicare trust funds. The trust funds are reimbursed for the administrative expenses for the SSI program, which are covered by Federal funds, from the SSI account, and from fees paid by States for federal administration of State SSI supplementation payments. The following table displays the LAE account by funding source (using FY 1999 actual data for illustrative purposes).

The LAE account funds:

• Salaries and benefits of SSA's Federal employees (excluding the Office of Inspector General);

• Related costs for space, equipment, supplies, travel, printing and other non-payroll expenses;

• System and telecommunications activities; and

• Expenses of the State Disability Determination Services (DDS), which make disability determinations on behalf of SSA.

Alignment of the APP and the Budget

SSA has aligned the strategic goals in our ASP and accordingly, the performance goals in our APP, by our major functional responsibilities rather than by program or budget account.

The program and financing schedules for SSA in the President's budget do not include program activities, per se. For example, under the heading "Obligations by Program Activity," SSA's LAE account displays total obligations by direct program and reimbursable program.

SSA's programs share many customers in common and rely on a common set of business processes. To highlight just a few examples:

• Many of our SSI applicants are also OASI or DI applicants;

• While there are a few legislative differences in the disability criteria for the DI and SSI programs, the processes we use to determine eligibility for disability benefits under the two programs vary only slightly;

• Much of our research and policy development in the area of disability supports both the DI and SSI programs; and

• We maintain earnings records in support of the OASI, DI and Medicare programs.

Fitting with the common characteristics of our programs, SSA has a single national service-delivery structure that does not specialize by program. By integrating services across all of our programs at the level of the customer, SSA is able to enhance efficiency, avoid duplication of effort and increase opportunities to provide one-stop service to our customers. As noted above, SSA's administrative costs, for all programs and associated functional responsibilities, are funded for the most part by the LAE appropriation.

The following chart links funding amounts within the LAE, research and OIG budgets to our four functional strategic goals. As the fifth goal, "valued employees," supports accomplishment of all our basic functions, the resources related to it are allocated across the other four goals.

Major Environmental Factors

Major environmental factors are, by definition, outside of our direct control. They create a context or need for our planning in general and with regard to individual performance goals and objectives. They may also constrain our ability to successfully meet some of our performance targets. Knowing this, we take them into account in developing and implementing our means and strategies. We will also consider their impact, in retrospect, as we track our actual performance against our goals, and when we report on our performance in our Annual Performance Report. As appropriate and feasible, we will make adjustments in our means and strategies to further assure our successful performance.

Following are some of the major environmental factors we have identified and our general approach to considering them or to mitigating their impact. Additional information on how we will consider or mitigate against these factors is found in the means and strategies discussions for each of our strategic objectives in Section V.

Challenging Business Environment

SSA faces an increasingly challenging business environment. Our customer base is expanding with the aging of the baby-boomers and enhanced life expectancy. After a period of modest workload increases through FY 2002, we know that a dramatic change in SSA workloads will begin to occur a few years thereafter. Given those projections, we know that we must begin now to position the Agency so it is prepared to handle the increases in claims expected as the baby-boomers reach their disability-prone years (their 50's) and then retirement age (in around 2008 when they begin to reach age 62).

We understand that constrained resources must continue as an SSA planning assumption. Performance targets and supporting means and strategies are being developed with that assumption and are grounded in what we can achieve with the resources that we reasonably expect to have available.

It is also a fact that our workforce continues to age along with the rest of the population; the average age of SSA employees is 46 years. SSA will be facing a critical loss of knowledge and experience within the next 5-10 years due to increased retirements of experienced employees. We have developed a transition plan to accommodate the Agency's future workforce needs in terms of skills and knowledge, and to make SSA an employer of choice for our future workforce.

Long-Term Solvency

Americans are living longer, healthier lives. In addition, the baby-boom generation is nearing retirement. These demographic changes create long-term funding issues for the Social Security programs. While revenues currently exceed benefit payments, in 2014 benefit payments will exceed revenues and interest from the trust funds will be needed to pay full benefits. The trust funds are projected to be depleted by 2034 under current law, at which point revenues will support only about 71 percent of benefits due. The President has proposed a framework to extend the solvency of the Social Security trust funds. Congress and outside policy organizations have also proposed plans to ensure Social Security's long-term solvency.

SSA has worked to ensure that the public has the information it needs to understand the essentials of the program so they can participate in the discussion of how best to strengthen Social Security for the future.

We are continuing to prepare analyses on the distributional and fiscal effects of proposals to strengthen Social Security programs developed by the Administration, Congress, and other policymakers. We will update those analyses, as new data become available.

Customer Expectations

Customers everywhere have come to expect continually improved service from SSA and other Federal sector organizations. To meet that expectation, SSA is committed to continuing to provide customer-responsive, world-class service to our customers.

Customer service is a major strategy driver in SSA, and it is the basic framework for all our planning activities. However, customer expectations are continually balanced against budgetary restraints, and resources are focused on areas that provide the best payoff.

We measure customer satisfaction through a formal survey that has been our main barometer since 1984. In FY 2000 we will move to a new Interaction Tracking System to monitor satisfaction. According to the latest survey data, the following service elements were rated most important by our customers:

• Knowledgeable staff who give clear explanations

• Staff who care about helping

• Clear and easy-to-understand mail

• Easy-to-complete forms

• One person handling the case

• Complete business with one call or visit

• Easy-to-reach 800-number service

• Prompt decisions and actions on cases

• Convenient office locations

• Easy-to-reach local telephone service

• Short in-office waits

We will continue to monitor customer satisfaction and preferences, and continue to develop strategies and initiatives that respond to emerging themes.

Employee Expectations

Through focus groups and surveys, we have also solicited the opinions of our workforce. For the most part, their vision of SSA's service mirrors the answers of the public. They also voice concerns about their own working environment. Our workforce tells us to:

• Aggressively protect the trust funds and prevent fraud

• Clearly state SSA's mission and support it through decisions that SSA makes

• Use a variety of media to educate the public

• Provide guidance to help employees understand the Agency's workload priorities

• Provide strong and visible leadership

• Provide a work environment that promotes safety, health and well-being of employees

• Provide better training, technology and communications to increase employee and management effectiveness

• Develop a managed strategy to attract and retain capable employees

The means and strategies we are developing and implementing mirror the important themes expressed by our employees. We are continuing to expand our solicitation of our employees' views and suggestions as we implement our various initiatives and as we develop our next Agency Strategic Plan.

Information Technology

The explosion of information technology presents SSA with vast opportunities for efficiencies and enhancements of customer service. Technology will enable us to simplify, speed, or eliminate tasks in our programmatic and administrative processes. As we develop an overall information technology architecture and applications, we also are providing our employees with the tools and training to use them.

Our customers are increasing their use of the Internet. They tell us that they like the convenience of doing business on the Internet and want SSA to implement more services. To respond to this demand, we are increasing the number of electronic transactions available to the public by adding Internet Services on SSA's website Social Security Online. Our vision is to implement comprehensive Internet services, including privacy and security safeguards, to expand access to information and for customers to conduct SSA business.

As SSA workloads increase over the next two decades, customer access to online information and processes via the Internet, with appropriate safeguards, will absorb some of the rising workload.

Other Technological Advances

Other technological advances will impact both our programs and our workloads. For example, advances that permit individuals to join, remain in, or rejoin the workforce despite their medical challenges are changing the traditional concept of disability. New medical technologies are improving health and increasing life expectancy. SSA is keeping these advances in view, and promoting research to improve our ability to develop policies that respond to changes in medical, technological, and other trends. For example, such research enables us to update the listings of impairments used in determination of disability.

Information Technology/Capital Investments

SSA's Information Technology Investments Support SSA's Goals, Objectives, and Key Initiatives

SSA assures that significant systems resources are dedicated to the support of our strategic goals. Systems workloads and developmental efforts are prioritized in a manner that assures that the Agency is pursuing its most critical workloads in an environment in which resources are limited.

The linkages between major information technology initiatives and our strategic goals are displayed below.

AGENCY GOAL         IT INITIATIVE
Desktop Management
Paperless Processing
Title II Redesign
Comprehensive Integrity Review Process
Earnings Improvement
Enumeration
Fugitive Felons
Data Exchange
Debt Management
Earnings Improvement
800 Number Immediate Claims Taking
Distributed Online Correspondence System
Electronic Disability System
Customer Feedback System
Integrated Human Resources System

While technology supports all five of the strategic goals in some way, it is a critical enabler of three of our goals, as follows:

Strategic Goal: To Deliver Customer Responsive World-Class Service

Providing online-access to customer information will enable our employees to fully respond to more customer requests at the initial contact. Examples of Key Initiatives (KIs): Online notices, Information exchange/expanded online access to State Bureaus of Vital Statistics, Title II Redesign, Talking and Listening to Customers

Substantially increasing our ability to provide service directly to customers via electronic means when privacy and security issues are resolved will enable continued provision of customer-responsive service, as our customers become accustomed to doing commercial business electronically and increasingly expect to conduct their government business that way. Examples of KIs: Internet Customer Services, Immediate Claims Taking

Strategic Goal: To make SSA program management the best in business, with zero tolerance for fraud and abuse

Increasing the up-front availability of information to and from other agencies through electronic access to data will help us combat fraud and enable us to improve the program integrity and accuracy of payments. Examples of KIs: More computer matching (e.g., with HCFA on nursing home admissions, with OCSE wage and unemployment compensation databases), Information exchange/expanded online access to State Bureaus of Vital Statistics

Technological enhancements, such as increasing the automated capacity to process work in a virtually paperless mode, will help us to achieve efficiencies, thereby freeing employee time for activities that are more difficult or inappropriate to simplify or automate. Examples of KIs: Paperless Processing Centers, Title II Redesign, Electronic Disability System, SSI PE Modernization

Strategic Goal: To be an employer that values and invests in each employee

Electronic tools and training are critical to achieving a highly skilled and high-performing workforce. Examples of KIs: Interactive video teletraining in addition to all other initiatives listed above

During FY 2000, SSA will virtually complete installation of the nationwide network of intelligent workstations and local area networks (known as IWS/LAN). During the seven year project, we will have installed approximately 96,000 workstations and 2,000 LANs. The IWS/LAN project is the enabling infrastructure for many of the technology-based initiatives, including those identified above, that SSA is implementing in support of its strategic goals. Our strategy to provide world-class service while workloads grow relies on business process improvements and automation such as IWS/LAN. IWS/LAN establishes a national computer network including desktop computer workstations for frontline employees supported by appropriate communications and software systems. This technology is critical in taking claims efficiently and providing online service to national 800-number callers. IWS/LAN not only provides employees with state-of-the-art tools that allow them to deliver world-class service in the near term, but also opens up new possibilities for doing business with our customers in the future, including enabling a single point of contact for an individual's case.

Capital Investments

Capital investment, primarily in the form of information technology (IT), supports all of SSA's strategic goals. SSA's IT investments have been funded through the Agency's annual Information Technology Systems (ITS) budget as well as the no-year Automation Investment Fund (AIF) appropriated to provide a modern SSA computer network. SSA's FY 2000 and FY 2001 ITS budgets include funds for the acquisition and maintenance of automated data processing and telecommunications hardware and software, as well as related contractual services.

The following table displays the FY 2001 ITS budget by baseline operations, strategic priorities, and cross-cutting IT initiatives.

SSA's Capital Assets Plan

In accordance with Part 3 of OMB Circular A-11, SSA submitted two Exhibit 300-B Capital Asset Plan and Justifications to OMB in January 2000. The documents identify two major acquisition areas that contribute significantly to the achievement of SSA's performance goals. Both major acquisition areas are critical to the delivery of services to the public and are an integral part of the Agency's IT infrastructure. The two major acquisition areas are:

• Data Communications Network
  This project funds the telecommunications services that are necessary to operate the SSA data communications network. SSA obtains the majority of its telecommunications services from the FTS 2000 and FTS 2001 Telecommunications contracts administered by the General Services Administration (GSA).
• Hardware/Software Lease and Maintenance for FY 2001
  IT hardware/software lease and maintenance services are necessary to support the Agency's data processing environment, which utilizes over 400,000 hardware devices and 3,500 software products.
• These areas requiring support include data center mainframe operations, operating system proprietary software, and client/server architecture and office automation.

SSA's Automation Support Processes Correspond to SSA's Planning Priorities

About 54 percent of SSA's FY 2001 ITS budget is needed to maintain ongoing SSA-wide computer operations and telecommunications services at current levels, including ongoing operational costs associated with the installed national computer network. The remaining 46 percent is for investments in automation for key initiatives (KIs) supporting Agency strategic goals and crosscutting IT initiatives. (Note: KIs are described in Appendix 3.)

Following is a display of the KIs to which significant systems support is devoted:

Significant support is also provided to the following additional KIs:

• Electronic Payment Services

• Employment Eligibility Verification Pilot

• Enumeration Verification Services

• Financial/Administrative Systems

• Integrated Human Resources System

• Interactive Video Teletraining

• Policy Process Redesign/Policy Net

SSA Communicates its IT Management and Investment Plans

For many years, SSA has published its IT management and investment plans in an Information Systems Plan (ISP), the most recent of which was released in September 1997. The ISP articulates how SSA's major systems initiatives contribute to the Agency's mission and support our priority KIs.

In 2000, SSA will issue an Information Technology Architecture (ITA) Plan that will replace the ISP. The ITA Plan will retain the strategic planning elements of the ISP, and will also address the Information Technology Management Reform Act (renamed the Clinger-Cohen Act) requirements for a plan that describes the relationships among the work the Agency does, the information the Agency uses, and the IT resources and infrastructure required for the performance of the Agency's mission.

A key element of the ITA Plan will be SSA's current enterprise ITA planning effort, which will define for SSA how computer hardware and software interact in support of the Agency's current and future business processes, and goals and objectives. It will more tightly incorporate Agency strategic and business planning in IT planning, recognize cross-cutting technology needs, allow for opportunities to standardize and take advantage of economies of scale, and in turn, provide feedback to the strategic planning process.

SSA's Capital Planning and Investment Control Processes Provide Additional Oversight

Key management reforms, as mandated by the Clinger-Cohen Act, have been in place at SSA for many years. For example, SSA's Systems Review Board was established in 1987 to provide independent oversight of IT budget and major IT investments for the Agency.

In 1996, SSA established the Chief Information Officer (CIO) position and transformed the Systems Review Board into the CIO Advisory Council composed of Executive Staff members and other selected participants. This high-level board, chaired by the CIO, participates in IT resource investment decisions and ensures Agency-wide awareness of and involvement in IT and information resources management (IRM) issues. The CIO reports to the Deputy Commissioner and has broad oversight for all major Agency functions, fully integrating the Agency's strategic, business, financial and IT planning and execution. The Deputy Commissioner for Finance, Assessment and Management (DCFAM) is the Deputy CIO and also the Agency's Chief Financial Officer.

All IT investments are reviewed by the CIO and the Advisory Council at least annually during the budget development process. The budget execution process monitors IT projects during the current year.

In line with the Agency's strategy to fund major IT investments after they are well-defined and demonstrated to be cost-beneficial, funds for promising implementations that are pending further analytical efforts or successful pilots are not released by the CIO for obligation until initiatives are demonstrated to be cost-beneficial and ready to proceed.

Designated major IT investments undergo regular reviews by the CIO and the Advisory Council to discuss progress and track outstanding issues.

SSA is enhancing its investment review process to assess major investments at key decision points to ensure the proposed initiatives are well founded, are redirected or terminated when necessary, are achieved within the approved cost and schedule, and provide expected benefits.

Impact of Initiatives on FY 2001 Workyear Requirements

The table below summarizes estimated FY 2001 workyear savings from initiatives proposed in the Social Security Administration's FY 2001 budget.

These savings represent estimated net additional capacity, over FY 1998 base levels, to do more work as a result of efficiencies produced by budgeted agency initiatives. This includes initiatives already underway and completed during the budget period and initiatives that will begin during the budget period. The additional capacity is built into SSA's budget estimates of workloads to be processed during FY 2001. Staff support workyears are considered part of the base.

Additional detail by Key Initiative follows: