This is the accessible text file for GAO report number GAO-04-789T 
entitled 'Supplemental Security Income: Sustained Management Attention 
Needed to Address Residency Violations' which was released on May 20, 
2004.

This text file was formatted by the U.S. General Accounting Office 
(GAO) to be accessible to users with visual impairments, as part of a 
longer term project to improve GAO products' accessibility. Every 
attempt has been made to maintain the structural and data integrity of 
the original printed product. Accessibility features, such as text 
descriptions of tables, consecutively numbered footnotes placed at the 
end of the file, and the text of agency comment letters, are provided 
but may not exactly duplicate the presentation or format of the printed 
version. The portable document format (PDF) file is an exact electronic 
replica of the printed version. We welcome your feedback. Please E-mail 
your comments regarding the contents or accessibility features of this 
document to Webmaster@gao.gov.

This is a work of the U.S. government and is not subject to copyright 
protection in the United States. It may be reproduced and distributed 
in its entirety without further permission from GAO. Because this work 
may contain copyrighted images or other material, permission from the 
copyright holder may be necessary if you wish to reproduce this 
material separately.

Testimony:

Before the Subcommittee on Human Resources, Committee on Ways and 
Means, House of Representatives:

United States General Accounting Office:

GAO:

For Release on Delivery Expected at 10:00 a.m. EDT:

Thursday, May 20, 2004:

SUPPLEMENTAL SECURITY INCOME:

Sustained Management Attention Needed to Address Residency Violations:

Statement of Robert E. Robertson, Director, Education, Workforce, and 
Income Security Issues:

GAO-04-789T:

GAO Highlights:

Highlights of GAO-04-789T, a testimony before the Chairman, 
Subcommittee on Human Resources, Committee on Way and Means, House of 
Representatives 

Why GAO Did This Study:

The Supplemental Security Income (SSI) program paid about $36 billion 
in benefits to about 6.9 million recipients in 2003. In recent years, 
the Social Security Administration (SSA) has identified a general 
increase in the amount of annual overpayments made to recipients who 
are not present in the U.S. as required by SSI program guidelines—a 
problem we refer as “residency violations”. This problem has caused 
concern among both program administrators and policy makers. As such, 
GAO was asked to determine what is known about the extent to which SSI 
benefits are improperly paid to individuals who are not present in the 
United States and to identify any weaknesses in SSA’s processes and 
policies that impede the agency’s ability to detect and deter residency 
violations.

What GAO Found:

Overpayments resulting from residency violations totaled about $118 
million between 1997 and 2001. However, this figure, which represents 
only violations detected by SSA, likely understates the true level of 
the problem. Additionally, the extent of violations appears to vary by 
geographic region, with overpayments being more prevalent in several 
large metropolitan areas. GAO found that 54 percent of all overpayments 
detected by SSA during this period occurred in just 15 counties. In 
addition, we found that recipients born outside the United States 
accounted for at least 87 percent of all residency overpayments.

SSA’s ability to detect and deter residency violations is impeded by 
three kinds of weaknesses. First, the agency relies heavily on self-
reported information from recipients to determine domestic residency, 
often without independently verifying such information. Second, SSA 
makes insufficient use of existing tools to detect violations, such as 
its “risk analysis” system, redeterminations, and home visits. Finally, 
the agency has not adequately pursued independent sources of 
information from other federal agencies or private organizations to 
detect nonresidency of SSI recipients. GAO recognizes that the SSI 
program is complex to administer, and residency requirements are 
particularly difficult to enforce because they can necessitate time-
consuming, labor-intensive verification checks, such as home visits. 
However, SSA has not employed a systematic, comprehensive approach to 
this problem that would allow the agency to use its available systems 
and procedures more efficiently and reduce the program’s exposure to 
additional violations. 

Top 15 Counties for SSI Residency Overpayments (1997-2001): 

[See PDF for image]

[End of figure]

What GAO Recommends:

GAO has made recommendations to the Commissioner of Social Security 
that will allow the agency to make optimal use of existing tools and 
new data sources to better detect potential residency violators.

www.gao.gov/cgi-bin/getrpt?GAO-04-789T.

To view the full report, including the scope and methodology, click on 
the link above. For more information, contact Robert E. Robertson (202) 
512-7215 or RobertsonR@gao.gov.

[End of section]

Mr. Chairman and Members of the Subcommittee:

I am pleased to be here to discuss the Supplemental Security Income 
(SSI) program. The Social Security Administration (SSA) administers the 
SSI program, which is the nation's largest cash assistance program for 
the poor. SSI provides financial assistance to people who are age 65 or 
older, blind or disabled, and who have limited income and resources. In 
2003, about 6.9 million recipients were paid about $36 billion in SSI 
benefits.[Footnote 1] Benefit eligibility and payment amounts for SSI 
recipients are determined by complex and often difficult to verify 
factors such as individual living arrangements, including whether a 
person resides in the United States (U.S.). Thus, the SSI program tends 
to be difficult to administer and susceptible to overpayments.[Footnote 
2] In recent years, SSA has identified a general increase in the amount 
of annual overpayments made to recipients who are not present in the 
U.S. as required by SSI program guidelines--a problem we refer to as 
"residency violations.":

My testimony today focuses on a report we issued in July 2003 in 
response to a request from this subcommittee.[Footnote 3] You asked us 
to (1) determine what is known about the extent to which SSI benefits 
are improperly paid to individuals who are not present in the U.S. and 
(2) identify any weaknesses in SSA's processes and policies that impede 
the agency's ability to detect and deter residency violations.

In summary, SSA detected overpayments of $118 million for residency 
violations between 1997 and 2001,[Footnote 4] but interviews with the 
Office of Inspector General (OIG) and agency officials suggest that the 
agency only detected a portion of the violations that occur each year, 
at least in some parts of the country. The extent of violations appears 
to vary by geographic region, with overpayments being more prevalent in 
several large metropolitan areas in five states--California, Florida, 
Illinois, New Jersey, and New York. We also found that recipients born 
outside the U.S. accounted for at least 87 percent of all residency 
overpayments. Three kinds of weaknesses have historically impeded SSA's 
ability to detect and deter residency violations. First, to verify 
domestic residency, the agency has often relied on self-reported 
information from recipients and visual inspection of documents that can 
be easily manipulated, such as rent receipts and letters from neighbors 
or clergy. Second, the agency has historically made limited use of 
tools at its disposal to detect possible violators, such as its risk 
analysis system to screen for high-risk cases more likely to result in 
overpayments. Third, SSA has not adequately pursued the use of 
independent, third-party data, such as emerging immigration databases 
or recipient bank account information, to help detect residency 
violations.

In response to our report recommendations, SSA indicated that it is 
considering implementing several initiatives that may provide a more 
complete picture of residency violations in the SSI program and improve 
its ability to detect and prevent such violations in a more efficient, 
timely manner. These include investigating the potential for obtaining 
access to foreign automated teller machines to track banking 
transactions over time, requesting assistance from state Medicaid fraud 
investigators to help SSA perform more home visits to verify 
recipients' residence, and investigating the potential of examining 
arrival/departure records maintained by the Department of Homeland 
Security to identify recipients who leave the country for more than 30 
consecutive days. While it is too early to assess how effective these 
initiatives may be, we support SSA's commitment to studying this 
problem further and its willingness to explore new data sources and 
improvements to existing processes as a way of detecting potential 
violations in a more timely manner. Thus, we view these initiatives as 
positive first steps. However, sustained management attention to 
identifying and preventing residency violations will be needed to 
further strengthen the integrity of the SSI program.

Background:

Individuals may apply for SSI benefits at any of about 1,300 SSA field 
offices. During the initial interview, SSA staff solicit information on 
applicants' financial situation and the disability being claimed. 
Applicants are required to report any information that may affect their 
eligibility for benefits, such as income, resources, and their living 
arrangements (including current residence). Similarly, once 
individuals receive SSI benefits, they are required to report changes 
in their address or residence to SSA in a timely manner. The Social 
Security Act (Section 1614 (a)(1)(B)(i)) requires that an individual be 
a resident of the U.S. to be eligible for SSI payments. SSA guidelines 
define a resident of the U.S. as a person who has established a 
dwelling in the U.S. with the intent to live in the country. Section 
1611(f) of the act also provides that no individual is eligible for SSI 
payments for any month during all of which the individual is outside 
the U.S. Recipients who fail to establish residency in accordance with 
SSI program guidelines or do not report absences of 30 days or more may 
be overpaid, and subject to monetary penalties and administrative 
sanctions such as suspension of benefits. Similarly, SSI recipients who 
become ineligible for SSI benefits because they violate SSI residency 
guidelines may also be ineligible to receive Medicaid benefits.

To a significant extent, SSA depends on program applicants and current 
recipients to accurately report important eligibility information. To 
verify this information, SSA may use computer matches to compare SSI 
records against recipient information in records of third parties such 
as other federal agencies. SSA also periodically conducts 
"redetermination" reviews to verify important eligibility factors, such 
as income and resources, to determine whether recipients remain 
eligible for benefits after the initial assessment.

SSA Detected Overpayments of $118 Million for Residency Violations over 
5 Years, but More May Go Undetected:

SSA detected overpayments of $118 million for residency violations 
between 1997 and 2001, but interviews with OIG and SSA officials 
suggest that the agency detects only a portion of the violations that 
occur each year, at least in some parts of the country. Special 
initiatives of limited duration conducted by SSA and its OIG have 
uncovered additional residency overpayments. According to our own 
analysis of SSA's data, residency overpayments appear to vary by 
geographic region, with the majority of overpayments having been 
detected in several large metropolitan areas. Finally, we determined 
that most of the overpayments detected during this period were 
attributable to recipients who were born outside the U.S.

Residency Violations May be More Prevalent than SSA Has Detected:

SSA detected an average of about 46,000 recipient residency violations 
annually between 1997 and 2001, resulting in $118 million in 
overpayments. While SSA's data show that less than 1 percent of all SSI 
recipients violate residency requirements annually, SSA field staff and 
OIG officials suggest that the problem may be more prevalent. For 
example, over the past few years, SSA and its OIG have initiated a 
number of studies estimating that residency violations in certain 
regions of the country may represent as much as 26 percent of SSI cases 
in those areas. These local studies were generally limited in duration 
and were performed within specific geographic areas:

* A 1997 SSA and OIG joint study of SSI residency used home visits in 
southern California to identify potential residency violations. The 
study concluded that about 25 percent of SSI recipients in one field 
office were living outside of the country. The study also determined 
that 47 percent of SSI recipients from this field office could not be 
located at their reported residence, an indication that they may be 
violating residency requirements.

* A 1998 OIG eligibility study in El Paso, Texas, found that about 26 
percent of recipients investigated were violating residency 
requirements. This project identified about $3 million in residency 
overpayments.

* In 1998 and 1999, joint SSA/OIG studies examined 32,641 recipients in 
New York and California who had not used their Medicaid benefits for at 
least 1 year.[Footnote 5] Using redetermination reviews, these studies 
found that 1,281 recipients (about 4 percent) were living outside the 
U.S.[Footnote 6]

Many Violations Are Geographically Concentrated:

Our analysis of SSA's data showed that overpayments due to residency 
violations are more prevalent in a number of large metropolitan areas. 
For example, overpayments from violations detected in Los Angeles 
County, California, represented 10.5 percent of the nation's SSI 
residency overpayments between 1997 and 2001. Overall, we found that 
just 15 counties in 5 states--California, Florida, Illinois, New 
Jersey, and New York--accounted for 54 percent of all residency 
overpayments detected by SSA during this period. (See fig. 1.) In 
addition to Los Angeles County, there were other counties with a 
significant percentage of SSI residency overpayments: Queens County, 
N.Y. (5.2 percent); New York County, N.Y. (5.0 percent); Kings County, 
N.Y. (4.8 percent); San Diego County, Calif. (4.1 percent); and Bronx 
County, N.Y. (3.5 percent). Moreover, of approximately 3,000 U.S. 
counties, 50 accounted for 77 percent of all residency overpayments 
detected by SSA during this time. (See fig. 1.):

Figure 1: Top 15 Counties for SSI Residency Overpayments, 1997-2001:

[See PDF for image]

[End of figure]

Most Overpayments Were Made to Recipients Born Outside the U.S.

SSA's data also showed that individuals born outside the U.S. accounted 
for at least 87 percent of all SSI residency overpayments between 1997 
and 2001.[Footnote 7] Residency overpayments were most common among 
recipients who were born in Latin America, the Caribbean, and South/
Southeast Asia, but included other areas as well, such as the Middle 
East. Recipients from the Philippines accounted for the greatest amount 
of residency violations or $24 million of all SSI residency 
overpayments during this period. SSA data also showed that recipients 
from just 14 countries and 1 U.S. territory accounted for about 73 
percent of all residency overpayments during this period. These include 
the Dominican Republic, (12.3 percent), Mexico (7.6 percent), Puerto 
Rico (7.5 percent), India (7.1 percent), and Iran (3.4 percent). (See 
fig. 2.):

Figure 2: Top 15 Countries of Origin for SSI Residency Overpayments, 
1997-2001:

[See PDF for image]

[A] Puerto Rico is a United States territory.

[End of figure]

Reliance on Self-Reported Information and Other Vulnerabilities Have 
Impeded SSA's Ability to Detect and Deter Violations:

SSA's ability to detect and deter residency violations has been impeded 
by three kinds of weaknesses. First, the agency has relied heavily on 
self-reported information from recipients to determine domestic 
residency, often without independently verifying such information. 
Second, SSA has made insufficient use of its existing tools for 
identifying potential violations, such as its risk analysis system to 
screen for high-risk cases. SSA has also not made optimal use of 
redetermination reviews, home visits, monetary penalties, and 
administrative sanctions to deter future violations. Finally, the 
agency historically has not made adequate use of independent data 
sources from other federal agencies or private organizations to detect 
nonresidency of SSI recipients.

SSA Has Relied Heavily on Self-Reported Information That Can be 
Manipulated:

SSA has relied on self-reported information, such as documents and 
statements from recipients, to establish proof of U.S. residency. Our 
prior work has shown that about 77 percent[Footnote 8] of all payment 
errors in the SSI program were attributable to recipients who do not 
comply with reporting requirements.[Footnote 9] In our recent review, 
about half the SSA field staff we interviewed reported that they relied 
on recipients to self-report important information with respect to 
travel outside the U.S. SSI program guidelines have generally directed 
SSA staff to accept recipients' assertions concerning residency unless 
they have reason to question the accuracy of their statements. If SSA 
field staff have reason to believe that a recipient has been outside 
the country for more than 30 days, they may request additional 
documentation such as a plane ticket, passport (or similar evidence 
which establishes date of entry into the U.S.), or a signed statement 
from one or more U.S. residents such as neighbors, clergy, or others 
who may have knowledge of the individual's whereabouts. However, 
program guidelines do not require field staff to perform any additional 
verification steps to establish recipients' residency. [Footnote 10]

We also learned that some of the documents accepted by SSA as proof of 
residence are subject to manipulation or forgery. For example, staff in 
one field office noted that documents such as rent receipts can be 
purchased from a local drugstore and easily forged. Other field staff 
said that statements from neighbors could be falsified or manipulated 
to support assertions that an individual has not traveled outside the 
country. Field staff also reported that recipients may use multiple 
passports in order to conceal extended stays outside the country. For 
example, staff in two SSA regions we visited said that SSI recipients 
sometimes use a foreign passport to exit and reenter the country while 
maintaining a separate, "clean" U.S. passport for evidence of 
continuing residency.

Given the agency's reliance on self-reported information, SSA field 
staff often used their personal experience, judgment, and ad hoc 
interviewing procedures to detect potential residency violations. In 
particular, SSA field staff have looked for inconsistencies in 
recipient statements or a recipient's inability to answer simple 
questions about where they live. For example, recipients may be asked 
about the names of people living in their household, or basic facts 
about their neighborhood such as the location of a well-known landmark. 
Staff may also ask whether a recipient owns property outside the U.S. 
Questionable or inconsistent answers to such questions may result in 
requests to provide additional documentation. However, effectively 
identifying residency violators has often depended on the experience 
and persistence of individual staff.

Our review also found that the procedures for documenting recipients' 
residency varied widely among the offices we visited, in particular, 
the number and types of evidentiary documents requested by staff. While 
staff in several offices reported that they often request only the most 
basic documentation required by SSI program guidelines, staff in other 
offices told us that they routinely ask for additional documentation 
for recipients, such as a second passport or other travel documents to 
determine whether the individual has been outside the country for more 
than 30 days. While these steps are not required, some field staff 
reported that they have been effective in identifying potential 
violators and deterring future violations. SSA staff reported a number 
of reasons for different documentation requirements such as variance in 
individual office policies, personal preferences based on experience, 
time pressures to complete cases, and the inability to effectively 
verify supplied documentation.

SSA Has Not Fully Exploited Its Tools for Detecting and Deterring 
Program Violations:

SSA has not made optimal use of several tools that could be used to 
detect residency violations. These include its "risk analysis system" 
for screening cases more likely to result in overpayments, its 
"redetermination reviews" of recipients' eligibility, and home visits 
to verify recipients' whereabouts. SSA has used statistical risk 
analysis techniques for many years in the SSI program to identify 
recipients who are more likely to be overpaid due to excess income or 
resources. Since SSA lacks adequate staff resources to conduct an 
annual review of every recipient, it uses this technique to identify 
recipients who are most likely to have a change in their eligibility 
status or benefit amount. [Footnote 11]

Despite the proven effectiveness of its risk analysis system to help 
the agency identify cases with the highest potential for overpayments, 
SSA has not used this tool to specifically identify potential residency 
violations. To determine whether it would be possible for SSA to more 
effectively identify potential residency violators by using its 
existing systems, we developed and tested a statistical model of 
factors possibly associated with residency violations.[Footnote 12] 
Using this model as a screen, we examined all recipients who were 
currently in violation of residency requirements as of April 
2003,[Footnote 13] and found that recipients born outside the U.S.--
noncitizens as well as naturalized citizens--were more than 40 times as 
likely to be violating residency requirements than were native-born 
recipients. Similarly, recipients with prior residency violations were 
about 10 times as likely to be current violators compared with 
recipients who have no prior violations. We also found that recipients 
who used post office boxes were somewhat more likely to be receiving 
benefits outside the country than those without post office boxes. 
Given the potential usefulness of this limited modeling demonstration, 
it may be possible for SSA to expand and refine its risk analysis 
system to better target potential violators. SSA is studying the 
potential for refining its screening technique to improve its 
effectiveness for identifying recipients at high risk for residency 
violations.

Beyond the targeting problems we identified with SSA's risk analysis 
system, we found that the agency was not using redeterminations as 
efficiently as it could despite the fact that SSA's data and our prior 
reviews have documented their effectiveness for verifying recipients' 
eligibility.[Footnote 14] In particular, home visits were used 
infrequently during redetermination reviews according to staff in a 
number of offices we visited.

Those field offices that have used home visits as part of their 
redetermination procedures have found them effective. About half of the 
field offices we visited (9 of 17) employed home visits at least some 
of the time to verify whether recipients actually live at the address 
they report to SSA. For example, the SSA regional office in Dallas, 
Texas contracted with a private investigation firm to conduct residency 
home visits. Using these investigators, field offices within the region 
performed 4,200 home visits that uncovered at least $2.1 million in 
additional overpayments between October 1997 and January 2003. 
According to SSA data, this project achieved a benefit-to-cost ratio of 
almost 8 to 1. Similarly, the California Department of Health Services 
has worked cooperatively with SSA field offices in the San Diego area 
by conducting residency home visits. Because Medicaid eligibility is 
often directly tied to SSI eligibility, identifying residency 
violations may save funds from both programs. Between October 2000 and 
September 2002, state Medicaid investigators identified about 1,600 SSI 
recipients with residency violations. In one instance, state 
investigators discovered an SSI recipient who was using a residence in 
southern California as a mailing address, while actually residing in 
Tijuana, Mexico, for at least 8 years. In another case, state 
investigators found an SSI recipient using a post office box in 
southern California as a mailing address, although the recipient was in 
fact living in San Felipe, Mexico, since 1982. Because the state 
provides these investigative services to SSA free of charge, it is 
highly cost-effective. To address this issue, SSA is currently 
exploring the potential for having states assist in performing home 
visits using their Medicaid fraud investigators. According to SSA, 27 
states and the District of Columbia have expressed an interest in 
assisting in this effort.

In terms of deterring future violations, we found that existing 
monetary penalties and administrative sanctions are rarely, if ever, 
used in the offices we visited.[Footnote 15] For example, about 72 
percent of the field staff we interviewed said that penalties or 
sanctions are not used in their offices, or are only used occasionally. 
National data on SSA's use of monetary penalties and administrative 
sanctions also suggest that these tools are not routinely utilized for 
recipients who fail to report important information that can affect 
their eligibility, including absences from the country. In a recent 
report, we estimated that at most about 3,500 recipients were penalized 
for reporting failures in fiscal year 2001.[Footnote 16] Under the law, 
SSA may impose monetary penalties on recipients who do not file timely 
reports about factors or events that can affect their benefits. A 
penalty causes a reduction in 1 month's benefits. Penalty amounts are 
$25 for a first occurrence, $50 for a second occurrence, and $100 for 
the third and subsequent occurrences. The penalties are meant to 
encourage recipients to file accurate and timely information. However, 
a large number of staff we interviewed noted that monetary penalties 
are too low to be an effective deterrent against future residency 
violations.

The Foster Care Independence Act of 1999 (Pub. L. No. 106-169) gave SSA 
authority to impose administrative sanctions on persons who 
misrepresent material facts that they know, or should have known, were 
false or misleading. In these circumstances, SSA may suspend benefits 
for up to 24 months. Despite having this authority, we found that 
benefit suspensions are rarely if ever used by field staff for 
residency violators. In fact, administrative sanctions were only 
imposed in 21 cases nationwide as of January 2002.[Footnote 17] A 
substantial number of staff told us that they rarely use sanctions 
because the process for imposing them is often time-consuming and 
cumbersome. In addition, some staff reported that SSA management does 
not encourage the use of penalties or sanctions to deter residency 
violations. SSA is currently evaluating its policies for imposing 
monetary penalties and administrative sanctions.[Footnote 18]

SSA Had Not Actively Pursued Third-Party Data Sources to Detect 
Potential Violators:

While SSA uses third-party information to verify certain aspects of 
recipients' eligibility such as income, we found that the agency has 
historically lacked adequate outside data sources to verify that 
recipients are residents of the U.S.[Footnote 19] The agency currently 
receives periodic paper reports from immigration officials on 
noncitizens who have current and planned absences from the U.S. and 
sends them to the appropriate SSA field offices for follow up. However, 
these procedures are only effective for recipients who voluntarily 
report their absence to immigration officials. Thus, SSA will remain 
limited in its ability to independently verify the residency of SSI 
recipients who deliberately seek to conceal extended periods outside 
the country. Over half of the SSA managers and field staff we 
interviewed told us that access to automated immigration data would 
help them to more accurately verify recipients' residency. We have 
recommended that SSA consider using a new system called the U.S. 
Visitor and Immigrant Status Indicator Technology system (US VISIT) to 
verify some recipients' entry and exit from the country. It is 
currently being used by the Department of Homeland Security and will 
incorporate existing entry-exit databases. When fully implemented, this 
system will provide a mechanism to monitor major ports of entry/exit in 
the U.S., including land crossings, seaports, and airports. As noted 
previously, SSA is examining the potential for obtaining access to the 
system to identify SSI recipients who reside outside the U.S. for more 
than 30 consecutive days.

SSA has also not fully utilized its authority to obtain independent 
data from other sources such as financial institutions as a tool for 
detecting potential residency violations. The Foster Care Independence 
Act of 1999 (FCIA) granted SSA new authority to verify recipients' 
financial accounts. To implement this authority, SSA issued proposed 
regulations on its new processes for accessing financial data in May 
2002.[Footnote 20] In September 2003, the agency issued its final 
regulations. SSA is testing processes to access the records of 
financial institutions and credit bureaus to detect unreported income 
or resources of SSI applicant and recipients. However, it is not clear 
whether SSA plans to use financial institution data more broadly to 
detect potential residency violations. In particular, it may be missing 
potentially helpful sources of information such as data on recipients 
who conduct banking transactions outside the U.S. using ATMs. As noted 
previously, a large proportion of the residency overpayments SSA 
detected between 1997 and 2001 were tied to recipients who originated 
in various countries in Latin America and South/Southeast Asia. 
However, SSA currently has no way to identify recipients who withdraw 
SSI benefits from ATMs outside the U.S. Information we obtained from a 
national financial data vendor indicates that it is now possible for 
authorized users to obtain detailed information on individuals' 
financial transactions from a large number of national and 
international institutions. SSA may be able to obtain data for 
recipients whose SSI benefits are direct-deposited into a U.S. bank and 
then withdrawn from automated teller machines outside the country over 
extended time periods. In response to our recommendation, SSA has 
indicated that it would explore the feasibility of obtaining such 
information to identify recipients who reside outside the U.S. for more 
than 30 consecutive days.

Mr. Chairman, this concludes my prepared statement. I will be happy to 
respond to any questions you or other Members of the Subcommittee may 
have.

GAO Contacts and Staff Acknowledgments:

For information regarding this testimony, please contact Robert E. 
Robertson, Director, or Daniel Bertoni, Assistant Director, Education, 
Workforce, and Income Security Issues at (202) 512-7215. Individuals 
making contributions to this testimony include Susan Bernstein, Jeff 
Bernstein, Jeremy Cox, Sal Sorbello, Vanessa Taylor, Wendy Turenne, and 
Shana Wallace.

[End of section]

Related GAO Products:

Supplemental Security Income: Progress Made in Detecting and Recovering 
Overpayments, but Management Attention Should Continue. GAO-02-849. 
Washington, D.C.: September 16, 2002.

Supplemental Security Income: Status of Efforts to ImproveOverpayment 
Detection and Recovery. GAO-02-962T. Washington, D.C.: July 25, 2002.

Social Security Administration: Agency Must Position Itself Now to Meet 
Challenges. GAO-02-289T. Washington, D.C.: May 2, 2002.

Social Security Administration: Status of Achieving Key Outcomes and 
Addressing Major Management Challenges. GAO-01-778. Washington, D.C.: 
June 15, 2001.

High Risk Series: An Update. GAO-01-263. Washington, D.C.: January 
2001.

Major Management Challenges and Program Risks: Social Security 
Administration. GAO-01-261. Washington, D.C.: January 2001.

Supplemental Security Income: Additional Actions Needed to Reduce 
Program Vulnerability to Fraud and Abuse. GAO/HEHS-99-151. Washington, 
D.C.: September 15, 1999.

Supplemental Security Income: Long-Standing Issues Require More Active 
Management and Program Oversight. GAO/T-HEHS-99-51. Washington, D.C.: 
February 3, 1999.

Major Management Challenges and Program Risks: Social Security 
Administration. GAO/OCG-99-20. Washington, D.C.: January 1, 1999.

Supplemental Security Income: Action Needed on Long-Standing Problems 
Affecting Program Integrity. GAO/HEHS-98-158. Washington, D.C.: 
September 14, 1998.

Supplemental Security Income: Opportunities Exist for Improving Payment 
Accuracy. GAO/HEHS-98-75. Washington, D.C.: March 27, 1998.

High Risk Program: Information on Selected High-Risk Areas. GAO/HR-97-
30. Washington, D.C.: May 16, 1997.

High Risk Series: An Overview. GAO/HR-97-1. Washington, D.C.: February 
1997.

FOOTNOTES

[1] This figure includes both federal funds and state supplemental 
funds.

[2] In 2001, outstanding SSI debt and newly detected overpayments for 
the year totaled $4.7 billion.

[3] See U.S. General Accounting Office, Supplemental Security Income: 
SSA Could Enhance Its Ability to Detect Residency Violations, 
GAO-03-724 (Washington, D.C.: July 29, 2003).

[4] More recent data on overpayments due to residency violations were 
not available at the time of this testimony.

[5] The rationale for targeting these cases was that financially needy 
individuals who were aged or disabled are likely to use Medicaid 
services on a regular basis. Thus, SSI recipients who have not used 
Medicaid for long periods of time may have left the U.S. or died.

[6] These studies considered the effect of only one potential indicator 
of residency violations--Medicaid nonutilization.

[7] The percentage of total residency overpayments attributed to 
recipients born outside of the U.S. may be higher than 87 percent 
because SSA could not identify a specific country of birth for 
recipients that represent about $10 million in SSI overpayments. 

[8] This figure represents data from fiscal years 1991 through 1995.

[9] See U.S. General Accounting Office, Supplemental Security Income: 
Action Needed on Long-Standing Problems Affecting Program Integrity, 
GAO/HEHS-98-158 (Washington, D.C.: Sept. 14, 1998). 

[10] SSI program guidance allows field staff to use home visits in 
selected circumstances, such as in response to a report from a third 
party that a recipient is outside the U.S. In addition, home visits may 
be employed if a recipient fails to provide information requested by 
SSA staff, or if a recipient does not respond to letters and/or 
telephone calls from staff asking them to appear at the local office. 
However, program guidelines give field office managers discretion in 
determining when to use home visits and allow them to take into 
consideration factors such as the safety of staff who perform such 
visits. 

[11] SSA's risk analysis system incorporates about 48 different 
characteristics--or variables--to help the agency determine which 
recipients will be selected for annual redetermination reviews. 
Recipients identified as being at higher risk for overpayments are 
designated as High Error Profile cases and may be subject to more 
frequent reviews that entail personal contact with SSA field office 
staff. Those recipients identified as being less likely to incur an 
overpayment are designated as Medium or Low Error Profile and may only 
receive a redetermination conducted by mail rather than in person. Some 
Low Error Profile cases are only examined once every 6 years. 

[12] The variables used in our model are not an exhaustive list of 
potential variables that SSA could use in its risk analysis system. 
They represent just a few of the characteristics that were frequently 
cited by prior reviews as well as SSA and OIG staff as potentially good 
predictors of residency violations.

[13] SSI recipients with residency violations were compared against 
recipients with no violations.

[14] SSA data show that, in 1998, refining the case selection 
methodology increased estimated overpayment benefits--amounts detected 
and future amounts prevented--by $99 million over the prior year. SSA 
officials have estimated that conducting substantially more 
redetermination reviews would yield hundreds of millions of dollars in 
additional overpayment benefits annually. See U.S. General Accounting 
Office, Supplemental Security Income: Progress Made in Detecting and 
Recovering Overpayments, but Management Attention Should Continue, 
GAO-02-849, (Washington, D.C.: Sept. 6, 2002).

[15] Prior GAO reports indicate that monetary penalties and 
administrative sanctions may be underutilized in the SSI program. See 
GAO-02-849.

[16] See GAO-02-849.

[17] Ibid.

[18] Ibid.

[19] For example, SSA routinely uses information from the Department of 
Health and Human Service's National Directory of New Hires to verify 
SSI recipients' income.

[20] See Access to Information Held by Financial Institutions, 67 Fed. 
Reg. 22021 (now codified at 20 C.F.R. pt. 416).