In fiscal year 2003, SSA paid about $70 billion to 7.5 million  disabled workers, their spouses, and dependents, with average monthly  cash benefits of about $723 per beneficiary. In addition, staff—particularly in SSA field offices—are also  required to balance numerous competing workloads, including processing  initial claims, serving individuals who walk into the field office without an  appointment, meeting with beneficiaries who have requested an  appointment, and processing a “special disability workload.”

	Overpayments in the DI Program Are Substantial and Have Increased in Recent Years

DI overpayment detections increased from about $772 million to about  $990 million between fiscal years 1999 and 2003. These overpayments  included a substantial amount due to beneficiaries who worked and  earned more than SGA. These overpayments  also contributed to mounting financial losses in the DI program. On the basis of data in  a recent study from SSA, we calculated that overpayments attributable to  work and earnings averaged about 31 percent of all DI overpayments  annually between 1999 and 2002. These officials agreed that  the estimate is generally accurate based on limited available data, but  likely understates the true extent of the problem. Total DI overpayment debt  increased from about $1.9 billion in 1999 to nearly $3 billion in 2003. Lack of Timely Data on Beneficiary Earnings and Other Vulnerabilities Impede SSA’s Ability to Detect and Prevent DI Overpayments

SSA’s ability to detect and prevent earnings-related overpayments is  hindered by a lack of timely wage data, inefficient processes for  conducting work CDRs, and potentially inaccurate management  information. Weaknesses in SSA’s Management Information Hinder Its Ability to Effectively Monitor Work CDR’s

Our review suggests that SSA relies on potentially inaccurate data to  manage its work CDR workload. Identified Vulnerabilities Contribute to Some Large Overpayments

The vulnerabilities we identified have likely contributed to old work CDR  cases and large earnings-related overpayments in the DI program. Some of these cases were as much as 7 years old and involved  large overpayments. Conclusions

We recognize that ensuring program integrity while focusing on the  important goal of returning individuals with disabilities to work presents  challenges for SSA. The new automated system that SSA is developing may help the agency  address some of the weaknesses we identified, but it is too early to  determine how effective it will be. Appendix I: Scope and Methodology

This appendix provides additional details about our analysis of the  Disability Insurance (DI) program’s work continuing disability review  (work CDR) process, including potential weaknesses in the Social Security  Administration’s (SSA) existing procedures and policies.
Why GAO Did This Study

The Social Security Administration's (SSA) Disability Insurance (DI) program is one of the nation's largest cash assistance programs for disabled workers. In fiscal year 2003, the DI program provided about $70 billion in financial assistance to approximately 7.5 million disabled workers, their spouses, and dependent children. This program has grown in recent years and is poised to grow further as the baby boom generation ages. The Senate Committee on Finance asked GAO to (1) determine the amount of overpayments in the DI program, particularly those attributable to earnings or work activity, and (2) identify any vulnerabilities in SSA's processes and policies for verifying earnings that may contribute to work-related overpayments.

What GAO Found

Overpayment detections in the DI program increased from $772 million in fiscal year 1999 to about $990 million in 2003. The true extent of overpayments resulting from earnings that exceed agency guidelines is currently unknown. Based on available data from SSA, GAO found that about 31 percent of all DI overpayments are attributable to DI beneficiaries who worked and earned more than allowed. Moreover, GAO found that these overpayments contributed to mounting financial losses in the program. From 1999 to 2003, total overpayment debt increased from about $1.9 billion to nearly $3 billion. Three basic weaknesses impede SSA's ability to prevent and detect earnings-related overpayments. First, the agency lacks timely data on beneficiaries' earnings and work activity. Second, SSA uses inefficient processes to perform work continuing disability reviews (work CDRs). Third, the agency relies on potentially inaccurate management information to effectively monitor and oversee some parts of this workload. These weaknesses contributed to some work CDR cases GAO identified that were as much as 7 years old, resulting in potential and established overpayments as large as $105,000 per beneficiary. In addition, GAO found that SSA relies on potentially inaccurate management information to administer its work CDR workload. SSA is developing new automated systems that may potentially address some of these problems and could help the agency balance the important goals of encouraging individuals with disabilities return to work, while also ensuring program integrity. However, it is too early to determine how effective such systems will be.