Supplemental Security Income

The impairments of many Supplemental Security Income (SSI) beneficiaries are difficult to verify, making the program vulnerable to fraud and abuse. GAO's review of a sample file of beneficiaries found that more than 60 percent had mental or physical disorders. In the six states GAO reviewed, providers who were examined for defrauding Medicaid, Medicare, or private insurance companies furnished some portion of the supporting medical evidence for more than 6 percent of 208,000 disabled SSI recipients. More than 96 percent of the 158 officials and staff GAO interviewed said that middlemen continue to help people improperly qualify for SSI benefits. The Social Security Administration (SSA) established pilot fraud investigation teams in five states in 1998 to examine individual cases of suspected fraud and abuse, developed new policies and procedures that make it easier to deny claims or terminate benefits when fraud or abuse is detected, and strengthened its ability to handle clients who do not speak English. Although the pilot teams have had positive results, these actions' overall effectiveness has been limited by the staff's reliance on their perceptions to identify suspicious claims and the lack of valuable information with which to judge claims' validity. SSA and Disability Determination Services staff do not always follow the new procedures because they conflict with the agency's emphasis on speedy claims processing, make them vulnerable to legal liability, and do not appear to cut the involvement of suspicious middlemen and medical providers in SSI cases. GAO recommends that SSA establish a national information system to help identify cases that warrant greater scrutiny, reevaluate its work credit and incentive structure to encourage attention to detecting fraud, and reexamine its policy toward interpreters.

GAO noted that: (1) although the number of people who have feigned injuries or illnesses to obtain SSI benefits is unknown, the SSI program is vulnerable to this type of fraud and abuse; (2) many SSI beneficiaries' impairments are difficult to objectively verify; (3) from a sample file of beneficiaries--developed by SSA to research characteristics of the SSI population--GAO found that more than 60 percent had such impairments, including psychoses, schizophrenia, and other mental disorders, as well as a range of physical disorders; (4) in addition, providers who have been investigated for defrauding Medicaid, Medicare, or private insurance companies furnished at least some portion of the supporting medical evidence for more than 12,000 of the 208,000 SSI disabled recipients in the 6 states GAO examined; (5) over 96 percent of the 158 officials and staff GAO interviewed said they believed that the practice of middlemen helping people improperly qualify for SSI benefits has continued; (6) SSA has taken several actions to reduce the program's vulnerability to this and other forms of fraud; (7) SSA has: (a) established pilot fraud investigation teams in five states during 1998 to examine individual cases where significant fraud and abuse is suspected; (b) developed new policies and procedures to make it easier to deny claims or terminate benefits when program fraud or abuse is detected; and (c) strengthened its ability to handle its non-English speaking clients; (8) these steps have achieved positive results; (9) front-line staff largely rely on their experience and perceptions to identify suspicious claims; they lack other valuable information, such as the names of middlemen and medical providers suspected of fraudulent or abusive practices by other employees or organizations, that could help them judge a claim's validity; (10) SSA and Disability Determination Services (DDS) staff said that they do not always follow the new procedures because they believe the procedures conflict with agency work incentives that stress speed in processing claims and because they believe they are not adequately protected from legal liability that could arise if they were to follow claims denial procedures; (11) they also question the agency's commitment to fighting fraud, since they repeatedly see the same suspicious middlemen and medical providers involved in SSI cases, despite previous referrals for investigation; and (12) several additional types of actions could reduce SSI's vulnerability to fraud and abuse by middlemen and medical providers.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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