The  amount of the subsidy for premiums, deductibles, copayments, and  catastrophic coverage varies, depending on income and resources. Progress Has Been Made in Approving Subsidy Applicants, despite Barriers, but Measuring Success Is Difficult

SSA has approved 2.2 million applicants for the subsidy as of March 2007,  despite some barriers, but measuring their success is difficult because no  reliable data are available to identify the eligible population. Because the agency lacked access to reliable data that might help  target their outreach efforts more narrowly, SSA used income records and  other government data to identify a broad group of potentially eligible  individuals. Since its initial outreach campaign, SSA has not  developed a comprehensive plan to identify its continued outreach efforts  apart from other activities. Although the initial campaign has ended, SSA is continuing to solicit  applications. SSA identified the target population by  using income data from various government sources to screen out  Medicare beneficiaries whose income made them ineligible for the Part D  subsidy. SSA officials said they took this approach  to ensure that all Medicare beneficiaries who were identified as potentially  eligible for the subsidy were made aware of the benefit and had an  opportunity to apply for it. The law, however, prohibits IRS from sharing such data with  SSA to assist with outreach efforts. Given these factors, IRS officials stated that summarily sharing private  taxpayer data to identify individuals who could qualify for the subsidy, and  the potential cost of systems changes, would have to be weighed against  the added value of the data. Other Barriers Have Limited SSA’s Solicitation Efforts

SSA’s efforts to solicit applications were hindered by beneficiaries’  confusion about applying for subsidy and the drug benefit. According to  SSA field office staff and state Medicaid and advocacy group officials,  many individuals were confused about the difference between the  prescription drug benefit and the subsidy, and did not understand that  they involved separate application processes. Measuring the Success of SSA’s Outreach Efforts is Difficult

The success of SSA’s efforts is uncertain because no reliable data exist on  the total number of individuals potentially eligible for the subsidy. Some of SSA’s Application Processes and Operations Lack Key Tools for Monitoring Performance

SSA has collected data and established some goals to monitor its progress  in implementing and administering the subsidy benefit, but still lacks data  and measurable goals in some key areas. Appeals

SSA tracks data on the total number of appeals, the reason for appeals, the  time it takes to process them, the method used to resolve them, and their  final disposition. SSA officials stated that since the redeterminations process is conducted  within a certain period of time, it is unnecessary to track the processing  time for individual redetermination decisions. SSA Has Monitored Some Aspects of the Subsidy Program’s Impact on SSA’s Workload, and Increased Funding Helped SSA Manage the Increased Workload

SSA has monitored some aspects of the increased workload and found  that implementing the low-income subsidy was manageable overall, due to  increased funding for its MMA startup costs. Using the $500 million appropriation for its MMA start up costs, SSA was  able to initiate the Part D subsidy and sign up 2 million people for the  subsidy without adversely affecting SSA’s overall operations. For some, the subsidy application is complicated, which is due in  part to the low-income subsidy eligibility requirements. We are considering recommendations for SSA to work with IRS to assess  the extent to which taxpayer data could help identify individuals who  might qualify for the subsidy, and help improve estimates of the eligible  population; and for SSA to develop a plan to guide its continuing outreach  efforts and develop key management tools to measure the results of its  subsidy application processes.
Why GAO Did This Study

To help the elderly and disabled with prescription drug costs, the Congress passed the Medicare Prescription Drug, Improvement, and Modernization Act (MMA) of 2003, which created a voluntary outpatient prescription drug benefit (Medicare Part D). A key element of the prescription drug benefit is the low-income subsidy, or "extra help," available to Medicare beneficiaries with limited income and resources to assist them in paying their premiums and other out-of-pocket costs. To assess Social Security Administration's (SSA) implementation of the Medicare Part D low-income subsidy, GAO was asked to review (1) the progress that SSA has made in identifying and soliciting applications from individuals potentially eligible for the low-income subsidy, and (2) the processes that SSA uses to track its progress in administering the subsidy. This statement is drawn from GAO's ongoing study for the committee on the Medicare Part D low-income subsidy, which is expected to be published at the end of May. To conduct this work, GAO reviewed the law, assessed subsidy data, and interviewed officials from SSA, the Centers for Medicare and Medicaid Services, the Internal Revenue Service, state Medicaid agencies, and advocacy groups.

What GAO Found

SSA approved approximately 2.2 million Medicare beneficiaries for the low-income subsidy as of March 2007, despite barriers that limited its ability to identify individuals who were eligible for the subsidy and solicit applications from them. However, the success of SSA's outreach efforts is uncertain because there are no reliable data to identify the eligible population. SSA officials had hoped to use Internal Revenue Service (IRS) tax data to identify the eligible population, but the law prohibits the use of such data unless an individual has already applied for the subsidy. Even if SSA could use the data, IRS officials question its usefulness. Instead, SSA used income records and other government data to identify 18.6 million Medicare beneficiaries who might qualify for the subsidy, which was considered an overestimate of the eligible population. SSA mailed low-income subsidy information and applications to these Medicare beneficiaries and conducted an outreach campaign of 76,000 events nationwide. However, since the initial campaign ended, SSA has not developed a comprehensive plan to distinctly identify its continuing outreach efforts apart from other agency activities. SSA's efforts were hindered by beneficiaries' confusion about the distinction between applying for the subsidy and signing up for the prescription drug benefit, and the reluctance of some potential applicants to share personal financial information, among other factors. SSA has collected data and established some goals to monitor its progress in administering the subsidy, but still lacks data and measurable goals in some key areas. While SSA tracks various subsidy application processes through its Medicare database, it has not established goals to monitor its performance for all application processes. For example, SSA tracks the time for resolving appeals and the outcomes of its initial redeterminations of subsidy eligibility, but does not measure the amount of time it takes to process individual redetermination decisions. According to SSA officials, implementing the low-income subsidy was manageable overall due to increased funding for the outreach and application processes and did not significantly affect the agency's workload and operations. GAO is considering recommendations for SSA to work with IRS to assess the extent to which taxpayer data could help identify individuals who might qualify for the subsidy, and help improve estimates of the eligible population; and for SSA to develop a plan to guide its continuing outreach efforts and develop key management tools to measure the results of its subsidy application processes.