Statement of Michael Astrue Commissioner of
Social Security Administration
the House Ways and Means Committee
Subcommittee on Social Security
April 15, 2010
Mr. Chairman and Members of the Subcommittee:
Thank you for holding this important hearing on providing outstanding service to the American people. This subject is critically significant, especially today as the baby boomers reach their retirement and disability-prone years in the middle of a serious economic downturn. With your assistance, we will continue our proud tradition of outstanding service.
For seventy-five years, Social Security has provided an economic safety net that has kept millions of our citizens from indigence in their old age and when they are disabled. Many Americans heavily depend on our services, especially during these uncertain times. The programs we administer are among the most important and successful in our country's history. The more than $60 billion in benefits we pay each month not only provide a lifeline to our beneficiaries and their families, but also are vital to the Nation's economy.
For a number of years, however, we have been struggling to maintain the level of service that the American people deserve. We did not receive the funding we needed, therefore our service suffered. The baby-boomer tsunami hit us and, more recently, the recession has driven an extra million economically-distressed workers and families to look to us for help each year.
Two years ago, I testified before the full Ways and Means Committee about our efforts to improve service to the public, and I asked for Congress's help. Congress delivered by supplying additional resources in our annual appropriation and in the Recovery Act, and I thank you for your support. We are using these resources wisely to deliver on our promises to you and the American people. Our services deteriorated for several years, and it will take several years to recover completely. While I am proud of our substantial progress in the last few years, much work remains. We have built a solid foundation with our energetic employees, including new hires, simple user-friendly online services, and business process improvements. Nevertheless, we need your continued support for adequate, timely, and sustained resources to maintain our momentum.
The Nation's recent economic recession, the worst since the Great Depression, has driven millions to us for assistance; we are flooded with retirement and disability claims. Based on the most recent economic assumptions for FY 2010, we estimate that we will receive over 375,000 more retirement, auxiliary, and survivors' claims and over 730,000 more disability claims than we estimated for FY 2010 only two years ago.
Online services are vital to good public service. In increasing numbers, the public expects to conduct complex business over the Internet. The Internet provides the public with the ability to conduct business at their convenience and at their own pace, without the need to take leave from work, travel to a field office, and wait to meet with an agency representative. In addition to being convenient for the public, this approach also reduces the average time spent by our employees processing claims. Trained agency representatives can use that additional time to handle more complicated issues. Let me be clear though—trained agency representatives continue to review every online application for benefits and contact applicants if there are any questions regarding their applications.
At the hearing two years ago, I discussed our vision to overhaul our online retirement application. The application we had in place at that time was nowhere near best-demonstrated practices, and, for most of the decade, only about 10 percent of the public applied for retirement online. To ensure that we provided the baby-boomers the service they expected and to free up our field offices so they could handle the matters requiring face-to-face interaction, we set a goal of receiving 50 percent of our retirement applications online within five years.
In December 2008, we launched a new, improved online application, iClaim, and saw an instant rise in the number of retirement applications filed online. In FY 2009, over 30 percent of all retirement applications were filed online, twice as many as in the prior year. We are now at 35 percent, and I am confident that we will reach our goal. Our online application has helped us keep up with an enormous growth in retirement claims. In FY 2009, online claims represented 83 percent of our total retirement claims growth.
We are continuing to expand our online offerings. Last month, we introduced an online Medicare- only application. In addition, our Multilanguage Gateway provides access to information in fifteen different languages, and we are on track to implement our first non-English interactive application, the Retirement Estimator, in Spanish later this year. We also are developing an online life-expectancy calculator to assist the public in deciding the best time to collect retirement benefits. We expect to launch the calculator during 2010.
The public appreciates our online applications. Customer satisfaction, as rated by the University of Michigan's American Customer Satisfaction Index (ACSI), jumped from 87 in the months prior to the iClaim release to 91 in the months following the release.
Three of our online services (Retirement Estimator, online retirement application, online Medicare Extra Help application) consistently rank at or near the top of private and public sector Internet services as rated by the ACSI.
Even though we did not market the option to file for disability benefits online when we launched iClaim, online disability applications have also increased from less than 10 percent just a few years ago to nearly 25 percent. We expect this positive trend to continue because in January, we released a simplified electronic version of the Adult Disability Report (i3368). We use this form to obtain basic information on an applicant's medical condition and treating sources. Feedback on the improved online disability application has been very positive. The average time required to complete the Adult Disability Report has been cut in half, completion rates have increased significantly from 65 percent to 73 percent, and the ASCI customer satisfaction score has increased by four points from 75 to 79.
Our FY 2011 budget performance commitments depend on continued growth of online applications for retirement and disability benefits. We expect to reach our Agency Strategic Plan goal of 50 percent of retirement applications filed online in FY 2012 and exceed our goal of 25 percent of disability applications filed online in FY 2012. Without the Internet, our field offices would be in dire need of even more resources.
NOTE: Includes retirement, disability, and SSI claims.
800 NUMBER AND FIELD OFFICE SERVICES
Our 800 Number is often the public's first point of contact with us. An efficient 800 number service provides convenient assistance to the public and reduces unnecessary visits to our field offices. Last year, we significantly reduced waiting times and busy signals on the 800 Number despite a significant increase in the number of callers.
In FY 2009, we received over 85 million calls to our 800 Number. To handle the increasing number of calls, we hired about 260 additional telephone agents last year, and we used technology to effectively forecast call volumes, anticipate staffing needs, and better distribute calls across the network. As a result, in FY 2009, we answered calls within an average of 245 seconds, 25 percent more quickly than we had the year before and the lowest average wait time in six years. In addition, we have reduced our busy rate by over 30 percent since FY 2008.
We expect call volumes to increase this year, and we plan to hire additional telephone agents to maintain our 800 Number services. To position ourselves for the future, we are working with the General Services Administration to build a new teleservice center in Jackson, Tennessee. The new teleservice center, the first to be opened in more than a decade, will open in 2011. In addition, we are replacing our national 800-Number infrastructure with a new state-of-the-art system that will help us improve service and increase efficiency.
Even with improved online and telephone services, more visitors are seeking assistance from our field offices. Over 600,000 more visitors came to our field offices in FY 2009 than they had in FY 2008. Despite this increased field office traffic and completion of more claims than ever before, we reduced office wait times.
Waiting times continue to drop. For the first six months of FY 2009, visitors without appointments waited on average about 26 minutes to meet with a representative. During the same time period in FY 2010, we have reduced that to an average of 22 minutes, a 15 percent decrease.
We are exploring ways to use video technology in our field offices to virtually connect to persons who live in remote areas or find it difficult to visit a field office in-person. We are piloting video services by using available staff in a less-busy office to help more stressed offices. In addition, we are placing video equipment at third-party sites, such as hospitals, libraries, community centers, and Native American reservations to provide field office service.
We continue to look for ways make the waiting rooms in our field offices more comfortable and informative for our visitors. We are piloting Social Security TV in some of our field office reception areas. The televisions broadcast visual information about our programs and services, such as explaining what documents are needed when applying for benefits or a Social Security number. We can tailor the broadcasts to the local demographics, providing information in multiple languages. We are expanding its use to over 150 offices this year.
In addition, given the rise in threats to our employees, we have been reviewing our physical security measures to enhance the protection of the public, our employees, and our facilities. We are now arming our guards in every facility and adding additional guards where and when necessary. We are working with the Office of the Inspector General, the Federal Protective Service, and other law enforcement agencies to protect our employees and ensure that threats are properly handled . We continue to review our security procedures and will adjust them as necessary.
Each year, we find ways to work smarter through innovation, automation, business process changes, and the strong commitment of our employees. We improved our productivity by an average of four percent in each of the last three years, but we cannot deliver quality services with productivity improvements alone.
We need a sufficient number of employees to handle our workloads. We carefully plan our staffing needs. We must anticipate expected losses, as we lose over 3,000 Federal employees and about 1,300 DDS employees throughout the fiscal year, mainly due to retirement, but also because of resignation and death of the employee. These losses do not occur at one time, but instead happen incrementally throughout the fiscal year, often with little or no advance notice. While we prepare to hire as soon as our appropriation is passed, resources do not always allow us to hire before people actually leave service.
In April 2008, I testified that total agency staffing had declined to about 60,000 employees and that we were struggling to provide quality, efficient service. With your support, our staffing now stands at 65,000. With l ast year's appropriation and Recovery Act funding, we maximized overtime nationwide and hired about 8,600 new employees. Management at every level of the agency responded to this hiring opportunity with the urgency that tough times require. It was our largest hiring effort since the creation of the Supplemental Security Income (SSI) program over thirty-five years ago.
We hired 2,400 people for the field in FY 2009, for a net increase in field office staff of about 1,000 people. With our FY 2010 appropriation, we continue to add about 1,300 new employees, and 1,400 people in the State disability determination services (DDSs). Last week, after reassessing our resources and critical needs, I approved 900 additional hires for front-line employment. Nearly all of these new employees will be placed in our most stressed field offices.
The combination of increased resources, improved efficiencies, and hard work allowed us to make substantial progress, which would have been even better if not for the additional claims. In FY 2009, we handled more new benefit applications and appeals than ever before. We adjudicated over 200,000 more initial disability claims, over 500,000 more retirement claims, and 86,000 more hearings than we had in FY 2008.
Our employees are highly motivated and dedicated to public service. In 2009, we surveyed our employees to learn about their opinions on working at Social Security. Ninety-five percent of the respondents stated that they perform important work. Nearly 85 percent stated that they like the work they do and that it gives them a feeling of personal accomplishment. Our employees know how their work relates to our goals and priorities, and there is a high level of cooperation among employees to get the job done. We are successful because of our dedicated and talented employees.
DISABILITY PROGRAM CHALLENGES
We are steadily driving down the hearings backlog. After a decade of growth, we have reduced the number of pending cases by almost 10 percent in just over a year. As of March, there were fewer than 700,000 cases pending for the first time since FY 2005. We have cut the time it takes to decide those cases by more than three months, from a monthly high of 532 days in August 2008 to 437 days in March 2010. These accomplishments are even more impressive considering that, while we were reducing the number of cases pending, we continued to focus on the oldest, most complex, and time-consuming cases, and we received 30,000 more hearing requests in FY 2009 than we had in FY 2008. The greatest improvements are occurring in the most backlogged offices. For example, processing time in the Atlanta North hearing office has dropped nearly 45 percent since February 2007, and it will drop again when the Covington, Georgia, office opens in the fall.
The President's FY 2010 budget is allowing us to continue reducing the hearings backlog. By the end of FY 2010, our hearings receipts will reflect the full impact of the recession. The increased initial disability claims will have worked their way through the administrative process. Despite these higher volumes, we are still on track to eliminate the hearings backlog by 2013.
In order to accomplish that goal, we hired 147 administrative law judges (ALJ) and over 1,000 support staff in FY 2009. We plan to hire 226 additional ALJs this fiscal year. In FY 2011, with full funding of the President's Budget, we will be able to hire another 70 ALJs and the support staff necessary to maintain at least a 4.5 to 1 support-staff-to-ALJ ratio nationally. With these hires, we will increase our ALJ corps to 1,450.
To accommodate this additional staff, we plan to open 25 new hearing offices and our fifth National Hearing Center over the next eighteen months. The first of these new offices opened in Anchorage, Alaska on February 19. Our four current National Hearing Centers hear cases by video conference for the most hard-hit areas of the country.
In FY 2011, we project that these enhancements will allow us to reduce processing times by nearly a month, to hold an all-time high of nearly 800,000 hearings and to reduce the backlog by another 50,000 cases.
Initial Disability Claims
Last year, DDS productivity and quality improvements allowed us to decide over 175,000 more initial disability claims than we had expected to complete and keep the pending level below 800,000. T he rising level of pending initial disability claims is unacceptable, and we are committed to returning to our pre-recession pending level.
In FY 2011, we plan to decide over 3.3 million initial disability claims, over 200,000 more than we expect to complete in FY 2010, and to reduce the pending level by 42,000 claims. Our strategy to reduce the initial disability claims pending level includes giving overtime and hiring authority to the DDSs, increasing Federal disability units that assist the DDSs, and simplifying policy.
We escalated our hiring in FY 2009. By the end of FY 2010, we expect to have 2,800 more DDS employees on board than we had at the end of FY 2008, and we will hire additional DDS staff in FY 2011. State furloughs of DDS employees, however, have impeded some of our progress in reducing the backlog. We need the full complement of DDS employees for our hiring strategy to be successful, and state furloughs of these employees only undermine our efforts. We appreciate your help as we try to convince the governors and legislatures that furloughing federally-funded employees only hurts our most vulnerable citizens as well as their States' economies without any benefit to State budgets.
In order to assist those states that have been worst hit, we have created Extended Service Teams (ESTs) modeled on the National Hearing Centers. The ESTs are located in states that have a history of good quality and high productivity, as well as the capacity to hire and train significant numbers of additional employees. We are electronically shifting claims from the hardest hit DDSs to these centralized teams, reducing the initial claims backlog. In March, we opened our first EST in Little Rock, Arkansas. Last week, we opened our second EST in Madison, Mississippi. We plan to open additional ESTs in Roanoke, Virginia and Oklahoma City, Oklahoma by the end of the fiscal year.
We are using technology to make disability determinations more quickly. Using our fast-track disability processes, Quick Disability Determinations and Compassionate Allowances, in FY 2009, we decided cases for about 100,000 applicants with the most debilitating impairments within about ten days after the DDSs received their claims. We hope to increase that number to 140,000 this fiscal year and 250,000 next fiscal year if accuracy can be maintained.
Health Information Technology (Health IT) will revolutionize our disability determination process. We need medical evidence to decide disability claims and rely upon doctors, hospitals, and others in the healthcare field to provide medical records in a timely fashion. Today, we are taking the first steps towards a totally electronic system of requesting and receiving medical records. With claimants' consents, we will have instantaneous access to their medical records.
In January 2010, we used over $17 million in Recovery Act funding to expand Health IT to 15 additional providers across 12 States. Our Health IT pilots in Massachusetts and Virginia demonstrated that electronic medical records can reduce disability processing times. Some disability decisions are now made in days, instead of weeks or months.
While we are emphasizing the need to reduce the backlog, we also recognize the need to improve the service we provide. We expanded the scope of our Wounded Warriors program to better serve our veterans and their families. This program expedites the disability claims of wounded service members who became disabled while in active military service. To assist and reach out to Wounded Warriors, representatives from our field offices regularly visit military installations to take claims, explain notices, make referrals, help complete forms, provide status on pending claims, and provide information about additional services. We have established a dedicated unit in Philadelphia to assist family members of deceased service members and to expedite claims to help their families. T his service is a concrete way that we support the military personnel, who so bravely serve our country.
The Administration is committed to implementing a multi-year plan to enhance Government-wide program integrity efforts. In addition to the important services we provide to the public, we must also continue to increase our cost-saving program integrity efforts, which ensure that Americans' tax dollars are spent properly and that beneficiaries continue to be eligible for benefits and are being paid the right amount. Program integrity reviews help to avoid improper payments, which have continued to grow in total dollar amounts as the number of beneficiaries has increased.
The FY 2011 budget includes resources for two types of program integrity efforts: continuing disability reviews (CDRs), which are periodic reevaluations to determine if beneficiaries are still disabled, and SSI redeterminations, which are periodic reviews of non-medical factors of eligibility, such as income and resources. In FY 2011, we plan to conduct 360,000 full medical CDRs and 2,422,000 redeterminations.
Both CDRs and redeterminations are extremely cost-effective. We estimate that every dollar spent on CDRs yields at least $10 in lifetime program savings. Every dollar spent on SSI redeterminations yields an estimate of $8 in program savings over 10 years, including savings accruing to Medicaid. If we meet our FY 2011 program integrity goals for redeterminations and continuing disability reviews, the estimated program savings over the ten year period through FY 2020 amount to more than $7 billion, including Medicare and Medicaid savings.
We also plan a national roll-out of another program integrity initiative. Our Access to Financial Institution (AFI) project automatically verifies disclosed and undisclosed financial accounts of SSI applicants and recipients. The program is currently operating in California, New York, and New Jersey. We plan to expand the AFI program this year, and expect to realize SSI program cost savings of $100 million in FY 2011 and could save up to $1 billion per year in lifetime savings when nationally implemented. The President's FY 2010 budget includes $10 million for AFI expansion.
With respect to payment accuracy, the most troublesome area for SSA is overpayment accuracy in the Title XVI program. Underpayment accuracy and Title II overpayment accuracy are consistently high. In 2008, however, the Title XVI Overpayment Accuracy Rate was 89.7 percent, the lowest rate since the early days of the program. To address this decline, we increased the volume of redeterminations of eligibility we conducted in FY 2009. As a result, the overpayment accuracy for 2009 has risen to 91.6 percent, which is a statistically significant improvement over the 2008 rate. This increase is encouraging news and demonstrates the value of additional funding for program integrity efforts.
FY 2011 Service Commitments
In FY 2011, we will pay $776.5 billion in Federal benefits to 60 million beneficiaries. In addition, we will:
• adjudicate over 7.9 million claims for benefits;
• decide 799,000 hearing requests;
• issue 19 million new and replacement Social Security cards;
• process 245 million earnings items for crediting to workers' earnings records;
• handle approximately 66 million 800-number transactions;
• issue 154 million Social Security Statements;
• process millions of actions to keep beneficiary and recipient records current and accurate; and
• conduct 360,000 medical CDRs and nearly 2.4 million non-disability SSI redeterminations.
In addition to these core workloads, we have other responsibilities related to Medicare, immigration, homeland security, and data exchanges.
PROTECTING OUR DATA
Over the last decade, we have moved from a paper-based system to electronic processing of our core workloads. In light of the new electronic environment, part of our plan to secure our data network is to strengthen our data center operations, both by bringing online the Second Support Center (SSC) and by replacing our aging National Computer Center (NCC). Our SSC is up and running. It handles part of our workloads and will provide backup service in the event of a failure at the NCC. Thanks to the Recovery Act funding, we are proceeding with the design and construction activities for our new National Support Center, which is scheduled to be completed in 2013.
I am proud that we are significantly improving the service we deliver to the American people. Without the additional funding Congress provided to us since FY 2008, Americans would now be facing significantly longer waits to receive decisions on their claims, speak to a representative in our field offices or on the phone, and have their cases heard by an ALJ.
While we hope that the worst of the recession is behind us, unemployment is predicted to remain high through FY 2011. Since high unemployment rates usually result in more benefit applications, we expect the number of new claims, particularly for disability, will be higher during FY 2011 than projected for that year under the FY 2010 President's budget. Even if new claims for retirement benefits stabilize, we will still face higher levels of the more labor-intensive disability work in FY 2011. These additional disability claims will ultimately result in more hearing requests.
The President's FY 2011 budget request of $12.5 billion is essential to our continued progress. As the American people are still struggling through the economic crisis, we cannot allow our services to deteriorate. A reduction in our funding at this time would reverse the progress we have made over the last two years. Millions of deserving Americans count on us, and we need your continued support to provide the service they need and deserve.