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United States Government Accountability Office: 
GAO: 

Report to Congressional Requesters: 

December 2014: 

Social Security Disability Benefits: 

Agency Could Improve Oversight of Representatives Providing Disability 
Advocacy Services: 

GAO-15-62: 

GAO Highlights: 

Highlights of GAO-15-62, a report to congressional requesters. 

Why GAO Did This Study: 

For years, states and counties have helped individuals who receive 
state or county assistance apply for federal disability programs. 
Federal benefits can be more generous, and moving individuals to these 
programs can allow states and counties to reduce their benefit costs 
or reinvest savings into other services. Some states have hired 
private organizations to help individuals apply for federal benefits, 
but the extent and nature of this practice is not well-known. GAO was 
asked to study this practice. 

This report examines (1) what is known about the extent to which 
states have SSI/DI advocacy contracts with private organizations, (2) 
how SSI/DI advocacy practices compare across selected sites, and (3) 
the key controls SSA has to ensure these organizations follow SSI/DI 
program rules and regulations. GAO reviewed relevant federal laws, 
regulations, and program rules; selected three sites to illustrate 
different contracting approaches; reviewed prior studies, including 
one by SSA’s Office of the Inspector General with a generalizable 
sample of disability claim files; and interviewed SSA, state, and 
county officials and contractors. 

What GAO Found: 

Little is known about the extent to which states are contracting with 
private organizations to help individuals who receive state or county 
assistance apply for federal disability programs. Representatives from 
these private organizations help individuals apply for Supplemental 
Security Income (SSI) and Disability Insurance (DI) from the Social 
Security Administration (SSA). Available evidence suggests that this 
practice—known as SSI/DI advocacy—accounts for a small proportion of 
federal disability claims. Using a variety of methods, including 
interviewing stakeholders, GAO identified 16 states with some type of 
SSI/DI advocacy contract in 2014. In addition, GAO analyzed a sample 
of 2010 claims nationwide and estimated that such contracts accounted 
for about 5 percent of initial disability claims with nonattorney 
representatives, or about 1 percent of all initial disability claims. 
Representatives working under contract to other third parties, such as 
private insurers and hospitals, accounted for an estimated 30 percent 
of initial disability claims with nonattorney representatives. 

Three selected sites represented different approaches to SSI/DI 
advocacy, but were similar in many respects. For example, Minnesota 
contracted with 55 nonprofit and for-profit organizations, while 
Hawaii and Westchester County, New York, each had a single contractor: 
a legal aid organization, and a for-profit company, respectively. At 
the same time, all three sites targeted recipients of similar state 
and county programs, such as General Assistance, and generally paid 
contractors only for approved disability claims, among other 
similarities. 

Figure: Key Stakeholders Involved with Social Security Disability 
Advocacy: 

[Refer to PDF for image: illustration] 

State agencies, County/local agencies, Hospitals, Insurance companies: 

Contract with: 

For-profit companies, Nonprofit organizations, Legal aid groups, 
Attorneys/law firms: 

to provide advocacy services to: 

General Assistance; Temporary Assistance for Needy Families (TANF); 
Homeless Children in foster care; Other populations. 

Source: GAO analysis of disability research and stakeholder 
interviews. GAO-15-62. 

[End of figure] 

SSA has controls to ensure representatives follow program rules and 
regulations, but these controls are not specific to those working 
under contract to states or other third parties and may not be 
sufficient to assess risks and prevent overpayments—-known by SSA as 
fee violations. Specifically: 

* Despite the growing involvement of different types of 
representatives in the initial disability determination process, SSA 
does not have readily available data on representatives, particularly 
those it does not pay directly. This hinders SSA’s ability to identify 
trends and assess risks, a key internal control. SSA’s existing data 
are limited and are not used to provide staff with routine 
information, such as the number of claims associated with a given 
representative. SSA has plans to combine data on representatives 
across systems, but these plans are still in development. 

* SSA does not coordinate its direct payments to representatives with 
states or other third parties that might also pay representatives, a 
risk GAO identified in 2007. In cases involving SSI/DI advocacy 
contracts, a representative may be able to collect payments from both 
the state and from SSA, potentially resulting in an overpayment—-a 
violation of SSA’s regulations. 

What GAO Recommends: 

GAO recommends that SSA (1) consider ways to improve data and identify 
and monitor trends related to representatives, and (2) enhance 
coordination with states, counties, and other third parties with the 
goal of improving oversight and preventing potential overpayments. SSA 
partially agreed with our recommendations and noted that it may 
consider additional actions related to representatives. 

View [hyperlink, http://www.gao.gov/products/GAO-15-62]. For more 
information, contact Daniel Bertoni at (202) 512-7215 or 
bertonid@gao.gov. 

[End of section] 

Contents: 

Letter: 

Background: 

Little Is Known About the Extent of Advocacy Contracts, but Evidence 
Suggests Such Contracts Account for a Small Proportion of Claims 
Nationwide: 

Selected Sites Represented Different Approaches to SSI/DI Advocacy but 
Were Similar in Many Respects: 

SSA's Controls over Representatives Providing SSI/DI Advocacy Services 
to States and Other Third Parties Are Limited: 

Conclusions: 

Recommendations for Executive Action: 

Agency Comments and Our Evaluation: 

Appendix I: Objectives, Scope, and Methodology: 

Appendix II: SSI/DI Advocacy Practices in Selected Sites: 

Appendix III: Comments from the Social Security Administration: 

Appendix IV: GAO Contact and Staff Acknowledgments: 

Tables: 

Table 1: Key Aspects of Selected Sites' SSI/DI Advocacy Practices: 

Table 2: SSI/DI Advocacy Services Provided by Selected Contractors in 
Three Sites: 

Table 3: Key Limitations of SSA's Data on Representatives: 

Figures: 

Figure 1: SSA's Disability Determination Process: 

Figure 2: Percentage of Initial Disability Claims with a 
Representative, by Program, 2004-2013: 

Figure 3: Key Characteristics of State and County SSI/DI Advocacy in 
2014: 

Figure 4: Estimate of Initial SSI and DI Claims Adjudicated in 2010 
with Nonattorney Representatives, by Type: 

Figure 5: Comparison of Former and Updated Versions of SSA Form 1696: 
To Appoint a Representative: 

Abbreviations: 

AFDC: Aid to Families with Dependent Children: 

ALJ: administrative law judge: 

CDR: continuing disability review: 

DDS: disability determination services: 

DI: Disability Insurance: 

GA: General Assistance: 

HHS: Department of Health and Human Services: 

IAR: Interim Assistance Reimbursement: 

ODAR: Office of Disability Adjudication and Review: 

OIG: Office of the Inspector General: 

SOAR: SSI/SSDI Outreach, Access and Recovery: 

SSA: Social Security Administration: 

SSI: Supplemental Security Income: 

TANF: Temporary Assistance for Needy Families: 

[End of section] 

United States Government Accountability Office: 
GAO:
441 G St. N.W. 
Washington, DC 20548: 

December 3, 2014: 

The Honorable Jeff Sessions: 
Ranking Member: 
Committee on the Budget: 
United States Senate: 

The Honorable Darrell Issa: 
Chairman: 
Committee on Oversight and Government Reform :
House of Representatives: 

The Honorable James Lankford: 
Chairman: 
Subcommittee on Energy Policy, Health Care and Entitlements: 
Committee on Oversight and Government Reform: 
House of Representatives: 

The Honorable Sam Johnson: 
Chairman: 
Subcommittee on Social Security: 
Committee on Ways and Means: 
House of Representatives: 

State and local governments throughout the United States are grappling 
with budgetary challenges and have sought ways to reduce spending on 
state-and county-funded benefit programs, while also providing 
eligible individuals with benefits to address their needs. To that 
end, some states and counties have contracted with organizations to 
(1) identify individuals with disabilities who are receiving 
assistance from state or local programs and might be eligible for two 
of the federal government's largest disability programs--Supplemental 
Security Income (SSI) and Disability Insurance (DI)--and (2) help them 
with the disability application process. Even though this practice--
referred to as SSI/DI advocacy--has been around for quite some time, 
little is known about the various forms state and local efforts can 
take. Media attention on states' use of SSI/DI advocacy comes on top 
of questions about the fiscal health and integrity of the federal SSI 
and DI programs, administered by the Social Security Administration 
(SSA).[Footnote 1] 

Against this backdrop, you asked us to review the SSI/DI advocacy 
services provided by private organizations. Specifically, we examined 
(1) what is known about the extent to which states are contracting 
with private organizations to identify and move eligible individuals 
from state-or county-administered benefit programs to Social Security 
disability programs, (2) how SSI/DI advocacy practices compare across 
selected sites, and (3) the key controls SSA has in place to ensure 
these organizations follow SSI/DI program rules and regulations. 

To address these objectives, we reviewed relevant federal laws and 
regulations and SSA program documentation, including policies and 
procedures. To gather more information about the extent to which 
states and other government entities are contracting with private 
organizations to provide SSI/DI advocacy services, we interviewed SSA 
and Department of Health and Human Services (HHS) officials; numerous 
state, county, and local officials; and stakeholders and researchers 
who work in this area. We also worked with national professional 
organizations representing state Temporary Assistance for Needy 
Families (TANF) agencies and state Disability Determination Services 
(DDS) directors to help identify states that may be engaged in these 
practices. In addition, we reviewed relevant studies; in particular, 
we reviewed findings from a recent SSA Office of the Inspector General 
(OIG) report, including the OIG's generalizable sample of disability 
claims with nonattorney representatives in 2010.[Footnote 2] In order 
to obtain in-depth information on states' and organizations' SSI/DI 
advocacy practices, we selected three sites--Hawaii; Minnesota; and 
Westchester County, New York--with SSI/DI advocacy contracts. We 
selected sites that had an established history of contracting for 
SSI/DI advocacy and represented a variety of approaches, such as 
contracting at the state or county level, or contracting with a single 
organization or multiple for-profit and nonprofit organizations. 
Specifically, we selected a state with a single, statewide nonprofit 
contractor; a state with multiple for-profit and nonprofit 
contractors; and a county with a single, for-profit contractor. We 
requested data from each site on the number of SSI and DI claims that 
were approved and the total amounts paid under the contract in state 
fiscal year or contract year 2013. We also collected SSA data on the 
total number of claims approved in the same state or county in 
calendar year 2012, the most recent year these federal data were 
available. We assessed the reliability of these data by interviewing 
knowledgeable SSA, state, and contractor officials and comparing data 
provided by the state or county and the contractors, and determined 
the data were sufficiently reliable for the purposes of providing 
contextual information on the size of these contracts. To analyze 
national trends in the involvement of representatives over time, we 
reviewed SSA data on initial SSI and DI claims with attorney and 
nonattorney representatives, from calendar year 2004 to 2013. We 
assessed the reliability of these SSA data by interviewing 
knowledgeable officials. We determined that these data were 
sufficiently reliable for the purposes of providing contextual 
information on national trends in representation. 

To determine what data and key controls SSA has regarding 
organizations and representatives, we reviewed relevant federal laws 
and regulations, policies, and procedures in SSA's Program Operations 
Manual System. We also interviewed SSA headquarters officials, as well 
as SSA officials in selected regional offices, field offices, and 
state DDSs.[Footnote 3] In addition, we assessed SSA's controls 
against GAO Standards for Internal Control in the Federal Government. 
[Footnote 4] 

We conducted this performance audit from September 2013 through 
December 2014 in accordance with generally accepted government 
auditing standards. These standards require that we plan and perform 
the audit to obtain sufficient, appropriate evidence to provide a 
reasonable basis for our findings and conclusions based on our audit 
objectives. We believe that the evidence obtained provides a 
reasonable basis for our findings and conclusions based on our audit 
objectives. See appendix I for additional information on our 
objectives, scope, and methodology. 

Background: 

Overview of Federal Disability Benefit Programs: 

The Social Security Administration administers two main programs that 
provide benefits to individuals with disabilities: SSI and DI. Adults 
are generally considered disabled if (1) they cannot perform work that 
they did before; (2) they cannot adjust to other work because of their 
medical condition(s); and (3) their disability has lasted, or is 
expected to last, at least 1 year or is expected to result in death. 
[Footnote 5] 

SSI is a means-tested income assistance program that provides monthly 
cash benefits to individuals who are disabled, blind, or aged and 
meet, among other things, the program's assets and income 
restrictions. In fiscal year 2015, SSA expects to pay an estimated $60 
billion in SSI benefits to about 8.5 million recipients. 

SSA's primary disability program, the DI program, provides monthly 
cash benefits to adults not yet at full retirement age when the 
individual is disabled and has worked long enough to qualify for 
disability benefits. In fiscal year 2015, SSA expects to pay an 
estimated $147 billion in DI benefits to about 11 million workers with 
disabilities and their spouses and dependents. Some disability 
recipients receive both SSI and DI benefits because of their work 
history and the low level of their income and resources. SSA expects 
costs for these programs to increase in the coming years.[Footnote 6] 

SSA's Disability Determination Process: 

SSA's disability determination process is complex and involves offices 
at the federal and state level (see fig.1). The process begins at an 
SSA field office, where a staff member determines whether a claimant 
meets the programs' nonmedical eligibility criteria. Claims from 
individuals meeting these criteria are then evaluated by state DDS 
staff, who review medical and other evidence and make the initial 
disability decision. SSA funds the DDSs, which are run by the states, 
to process disability claims in accordance with SSA regulations, 
policies, and guidelines. Some DDSs may be independent state agencies, 
while others may be part of other state agencies with broader 
missions, such as departments of human services. If an initial claim 
is denied, claimants have several opportunities for appeal within SSA, 
starting with a reconsideration; then a hearing before an SSA 
administrative law judge (ALJ); and finally at the Appeals Council, 
which is SSA's final administrative appeals level.[Footnote 7] If the 
claimant is determined to be eligible for SSI or DI, SSA will 
calculate the benefit amount and begin to pay benefits. A claimant may 
also be entitled to past-due benefits for the months in which his or 
her SSI or DI cash payments were pending during the disability 
decision-making process. 

Figure 1: SSA's Disability Determination Process: 

[Refer to PDF for image: process illustration] 

Claimant can appoint a representative at any point in the process: 

Initial contact: 
SSA field office staff determines if claimant meets non-medical 
requirements, and, if so, forwards complete applications to state 
Disability Determination Services (DDS). 

Initial determination: 
* State DDS staff gathers, develops, and reviews medical and 
vocational evidence; 
* State DDS examiners use evidence, generally in consultation with 
medical professionals, to make a disability determination; 
If Eligible: 
* Claim processed and claimant paid; 
* Representative may be compensated; 

If Denied: 
Reconsideration[A]: If claimant pursues case: 
* A different group of state DDS staff reexamines prior and any new 
evidence; 
* This group uses evidence to make a disability determination' 
If Eligible: 
* Claim processed and claimant paid; 
* Representative may be compensated; 

If Denied: 
Hearings level: If claimant pursues case: 
* Hearing office collects any additional evidence and prepares claim 
for administrative law judge (ALJ) review; 
* ALJ may conduct a hearing before rendering a new decision; 
If Eligible: 
* Claim processed and claimant paid; 
* Representative may be compensated; 

If Denied: 
Appeals Council: If claimant pursues case: 
* Administrative appeals judges decide whether to review claim and any 
new evidence; 
* If claim is reviewed, the judges can issue a decision or return the 
case to hearings level for a new decision; 
If Eligible: 
* Claim processed and claimant paid; 
* Representative may be compensated. 

Note: After going through the disability determination process within 
SSA, claimants must file any further actions in federal court. 

[A] In 1999, SSA began testing the Disability Redesign Prototype model 
in 10 states, which included eliminating the reconsideration step of 
the administrative review process for disability claims. 

Source: GAO analysis of Social Security Administration (SSA) data. 
GAO-15-62. 

[End of figure] 

Role of Appointed Representatives: 

Claimants may choose to appoint a representative to assist them 
through the disability application process and in their interactions 
with SSA. Appointed representatives can be attorneys or nonattorneys, 
and, as long as they meet SSA's requirements for representatives, 
their experience can range from being a family member appointed as a 
representative on a one-time basis to a professional representative 
working at a for-profit or nonprofit organization.[Footnote 8] A 
representative may act on a claimant's behalf in a number of ways, 
including helping the claimant complete the disability application, 
obtaining and submitting evidence in support of a claim, and 
supporting the claimant during the hearings and appeals process. 

To appoint a representative, a claimant must sign a written notice 
appointing the individual to be his or her representative in dealings 
with SSA and file the notice with SSA. Representatives can file this 
notice using a standard form,[Footnote 9] which contains the name and 
address of the representative. The standard form also indicates 
whether and how the representative would like to be paid--by the 
claimant, directly by SSA out of a claimant's past-due benefits (known 
as a direct payment), or by a third party.[Footnote 10] 

Representatives have commonly been involved at SSA's hearings and 
Appeals Council levels, but evidence suggests that representatives 
have become increasingly involved at the initial stage of the 
disability determination process. SSA data compiled for this report 
show that the proportions of SSI and DI claims with a representative 
at the initial level increased between 2004 and 2013. From 2004 to 
2013, initial SSI claims with a representative increased dramatically, 
from almost 11,000 claims in 2004 (less than 1 percent of all initial 
SSI claims) to about 278,000 claims in 2013 (about 14 percent of 
claims). Initial DI claims with a representative also increased over 
the same time period, from almost 100,000 claims (about 8 percent of 
claims) to more than 413,000 claims (about 20 percent of claims). (See 
figure 2.) In 2013, two-thirds of the representatives associated with 
initial claims were attorneys and one-third were nonattorneys. 

Figure 2: Percentage of Initial Disability Claims with a 
Representative, by Program, 2004-2013: 

[Refer to PDF for image: multiple line graph] 

Year: 2004; 
Social Security Disability Insurance (DI): 8.1%; 
Supplemental Security Income (SSI): 0.6%. 

Year: 2005; 
Social Security Disability Insurance (DI): 8.4%; 
Supplemental Security Income (SSI): 1.6%. 

Year: 2006; 
Social Security Disability Insurance (DI): 8.9%; 
Supplemental Security Income (SSI): 2.1%. 

Year: 2007; 
Social Security Disability Insurance (DI): 9.8%; 
Supplemental Security Income (SSI): 3.4%. 

Year: 2008; 
Social Security Disability Insurance (DI): 10.5%; 
Supplemental Security Income (SSI): 5.9%. 

Year: 2009; 
Social Security Disability Insurance (DI): 10.6%; 
Supplemental Security Income (SSI): 6.4%. 

Year: 2010; 
Social Security Disability Insurance (DI): 12.7%; 
Supplemental Security Income (SSI): 7.5%. 

Year: 2011; 
Social Security Disability Insurance (DI): 15.5%; 
Supplemental Security Income (SSI): 8.9%. 

Year: 2012; 
Social Security Disability Insurance (DI): 17.5%; 
Supplemental Security Income (SSI): 10.4%. 

Year: 2013; 
Social Security Disability Insurance (DI): 19.9%; 
Supplemental Security Income (SSI): 14.4%. 

Source: GAO analysis of Social Security Administration data. GAO-15-62. 

[End of figure] 

These trends may, in part, reflect legislative actions that expanded 
payment options for representatives in the disability determination 
process. For example, the Social Security Protection Act of 2004 
temporarily allowed attorney representatives to receive direct 
payments from SSA, out of claimants' past-due benefits, for SSI 
claims, and also required a demonstration project under which SSA's 
direct payment system applied to qualified nonattorney 
representatives.[Footnote 11] These policy changes were made permanent 
in 2010.[Footnote 12] 

SSI/DI Advocacy Initiated by States, Counties, and Other Third Parties: 

States and counties have engaged in SSI/DI advocacy efforts for years 
because it can benefit individuals with disabilities as well as the 
state and counties.[Footnote 13] When states are successful in helping 
eligible individuals on state-or county-administered assistance 
programs navigate the complex disability application process and 
obtain federal disability benefits, the individuals and their families 
not only may generally receive a higher monthly income but can also 
potentially receive benefits on a long-term basis. At the same time, 
successful SSI/DI advocacy efforts allow states to reduce benefit 
costs or reinvest cost savings into expanding services or serving 
other individuals. 

The financial incentives for states to pursue SSI/DI advocacy 
increased in two ways with the creation of the TANF program in 1996 
and subsequent changes to TANF requirements. As some researchers 
noted, under the former program, Aid to Families with Dependent 
Children, states received less than half of any savings achieved 
through transferring individuals to SSI.[Footnote 14] Under TANF, 
however, states retain the savings from federal and state funds that 
would have been used to support those individuals and can use those 
funds for other allowable benefits or services. At the same time, the 
new work participation requirements of the TANF program required a 
percentage of each state's caseload to participate in employment-
related activities. States that do not meet required work 
participation rates are at risk of having their annual TANF block 
grants reduced. Therefore, the work requirements provided incentives 
for states to remove certain families from the calculation of the work 
participation rate, including individuals with disabilities who have 
significant barriers to work.[Footnote 15] 

States have taken different approaches to SSI/DI advocacy. Some states 
designate state employees to provide SSI/DI advocacy services, while 
others contract with for-profit or nonprofit organizations or legal 
aid groups. Some states do not have SSI/DI advocacy programs at all. 
Furthermore, some SSI/DI advocacy efforts are at the county or local 
level. In addition to states and counties, other third parties--such 
as hospitals and private insurance companies--also contract for SSI/DI 
advocacy services. For example, hospitals contract with companies to 
obtain reimbursement for medical care provided to patients who do not 
have health insurance by helping patients establish eligibility for 
various federal, state, and county programs, such as SSI and Medicaid. 
Insurance companies may also contract with companies to help 
individuals receiving long-term disability benefits apply for federal 
disability benefits, in part because federal disability benefits can 
reduce the amount the insurance company must pay. 

State Assistance Programs Serving Individuals Who May Qualify for 
Federal Disability Benefits: 

States--and county and local governments, in some cases--administer a 
number of assistance programs for low-income individuals and families, 
some of whom have disabilities that may qualify them for federal 
disability programs. In many instances, these low-income individuals 
can qualify for SSI due to their income and assets, among other 
factors. Some may also qualify for DI benefits, if they have a 
sufficient work history. As a result, states may direct SSI/DI 
advocacy services to people receiving benefits from any of the 
following programs: 

* TANF: This federal block grant provides funds to states for a wide 
range of benefits and services, including state cash assistance 
programs for needy families with children. TANF is administered by 
HHS's Administration for Children and Families at the federal level 
and by state and, in some cases, county agencies. State TANF programs 
provide temporary, monthly cash payments to low-income families with 
children while preparing parents for employment. A percentage of each 
state's caseload must participate in a minimum number of hours of 
employment-related activities unless they are exempt. 

* State General Assistance: These programs provide cash assistance to 
poor individuals who do not qualify for other assistance programs 
(e.g., they do not have children and are not elderly). As of January 
2011, 30 states had General Assistance programs, and most states 
require individuals to be unemployable generally because of a physical 
or mental condition.[Footnote 16] 

* Other State Assistance Programs: Other populations or programs 
states may target for SSI/DI advocacy include, for example, homeless 
individuals[Footnote 17] or individuals receiving state medical 
assistance or foster care payments. 

Interim Assistance Reimbursement to States: 

Some states may receive funds from SSA, known as Interim Assistance 
Reimbursement (IAR), for assistance they provide (i.e., cash 
assistance provided through state programs like General Assistance to 
meet basic needs[Footnote 18]) to an individual who is waiting for 
approval of SSI benefits.[Footnote 19] If the individual's SSI claim 
is successful, SSA uses the claimant's past-due benefits to reimburse 
the state for this interim assistance. States may, in turn, use these 
funds to finance their SSI/DI advocacy efforts. To qualify for 
reimbursement, any interim assistance an individual receives while 
awaiting SSA's decision must be funded only from state or local funds. 
Interim assistance payments to a needy individual that contain any 
federal funds do not qualify for reimbursement. For example, IAR is 
generally not payable to states for assistance payments related to 
programs like Medicaid and TANF because the federal government 
partially funds these programs.[Footnote 20] To participate in the IAR 
program, a state must have an IAR agreement with SSA and a written 
authorization from the individual allowing SSA to reimburse the state 
from his or her past-due benefits.[Footnote 21] As of 2014, 36 states 
and the District of Columbia have IAR agreements with SSA. 

Little Is Known About the Extent of Advocacy Contracts, but Evidence 
Suggests Such Contracts Account for a Small Proportion of Claims 
Nationwide: 

Limited Information Exists, but We Identified 16 States with Some Type 
of SSI/DI Advocacy Contract in 2014: 

Little is known about the extent to which states or counties contract 
for SSI/DI advocacy services. While SSA has oversight of the federal 
SSI and DI programs, officials told us that they do not know which 
states or counties are contracting for SSI/DI advocacy services, in 
part because that information is not necessary to achieve SSA's 
mission, which includes delivering retirement, survivor, and 
disability benefits and services to eligible individuals and their 
families. While SSA collects some data on representatives working on 
behalf of claimants, it does not collect information on whether these 
representatives are working under contract to a state or county. 
Similarly, HHS has oversight of the federal TANF program and collects 
information about how states use TANF block grant funds but, according 
to HHS officials, the agency does not have statutory authority to 
collect information on states' contracts for SSI/DI advocacy. In 
addition to the absence of comprehensive data from SSA and HHS, it is 
difficult to determine the extent of these contracts nationwide 
because this practice is diffused among different agencies and 
different levels of government, depending on the state. 

Furthermore, we did not identify research that provides a national 
picture of state SSI/DI advocacy contracting practices. For example, 
one study we reviewed looked at the overlap between the TANF and SSI 
populations, but it was not the purpose of the study to examine the 
extent to which states were contracting for SSI/DI advocacy services. 
The study did not include recipients of other benefit programs, like 
state-funded General Assistance, that we found were commonly served by 
SSI/DI advocacy contracts.[Footnote 22] 

Despite limited national-level data, we identified at least 16 states, 
as of August 2014, that had some type of active contract or grant for 
SSI/DI advocacy in 2014: California, Colorado, Delaware, Hawaii, 
Massachusetts, Minnesota, Nevada, New York, Ohio, Oklahoma, Oregon, 
Pennsylvania, Rhode Island, Tennessee, Virginia, and Wisconsin. 
[Footnote 23] (See figure 3.) 

Figure 3: Key Characteristics of State and County SSI/DI Advocacy in 
2014: 

[Refer to PDF for image: illustration] 

Level of government issuing contract: 

1 or more counties (4): 
California; 
Nevada; 
Ohio; 
Oregon. 

State (10): 
Delaware; 
Hawaii; 
Massachusetts; 
Minnesota; 
Oklahoma; 
Pennsylvania; 
Rhode Island; 
Tennessee; 
Virginia[A]; 
Wisconsin. 

Both (2): 
Colorado[A]; 
New York. 

Type of organization: 

For profit: 
Virginia. 

Nonprofit/legal aid (10): 
Colorado; 
Delaware; 
Hawaii; 
Massachusetts; 
Nevada; 
Oklahoma; 
Oregon; 
Pennsylvania; 
Rhode Island; 
Tennessee. 

For-profit and nonprofit/legal aid (4): 
California; 
Minnesota; 
New York; 
Wisconsin. 

Unknown: 
Ohio. 

Source: GAO analysis of information provided by selected states and 
counties. GAO-15-62. 

Note: The figure represents information available to us regarding state 
and county contracts and their characteristics as of August 2014. 

[A] The state-issued contracts in Virginia and Colorado do not provide 
SSI/DI advocacy services to the entire state, but rather only to 
specific geographic areas within the state, according to state 
officials. 

[End of figure] 

Half of the 16 states we identified contracted with multiple 
organizations in 2014, including for-profit, nonprofit, and legal aid 
organizations, according to state and county officials we contacted. 
For example, according to state officials, the Wisconsin Department of 
Children and Families contracted with 8 organizations (both for-profit 
and nonprofit) for SSI/DI advocacy services, with each covering 
different geographic areas, as part of a larger contract for TANF 
employment support services. At the same time, 7 states reported they 
had a state contract or grant with a single nonprofit or legal aid 
organization. For example, Tennessee officials stated they provided a 
grant to a legal aid organization to work with about 100 TANF 
recipients per year who may be eligible for federal disability 
benefits. 

Within states, we identified SSI/DI advocacy contracts at different 
levels of government. In several states, we identified only county-
level contracts (see figure 3), and in one state, New York, we 
identified at least one contract at the state, county, and city level. 
Specifically, according to state officials, New York had a statewide 
Disability Advocacy Program that provided grants to a group of 
nonprofit and legal aid organizations to help individuals appeal their 
claim after it was initially denied.[Footnote 24] Westchester County 
also had a contract with a for-profit organization for SSI/DI 
advocacy. In addition, officials from New York City's Wellness, 
Comprehensive Assessment, Rehabilitation and Employment (WeCARE) 
program reported that they contract with two nonprofit organizations 
to provide SSI/DI advocacy services.[Footnote 25] 

We also observed recent changes in states' SSI/DI advocacy contracting 
practices. We identified multiple states that have ended, or plan to 
end, their SSI/DI advocacy contracts, and at least one state that is 
planning to renew a contract it ended several years ago. Several state 
officials and experts cited reasons for ending or renewing SSI/DI 
advocacy contracts, including financial considerations. For example, 
according to state officials, Maryland had a contract for over a 
decade with an organization to work with TANF recipients who may be 
eligible for federal disability benefits. The state paid this 
organization for each disability application submitted; however, state 
officials told us they ended this contract in 2009 because it was no 
longer financially practical. According to state officials, in 2014, 
the state planned to issue a new request for proposals for SSI/DI 
advocacy that will only pay the contractor for approved claims. 
Officials told us that they expect that the performance-based 
compensation structure of the contract will make it financially 
practical again. In contrast, officials in Delaware told us they had a 
contract with a single nonprofit organization for about 6 years to 
work with TANF recipients, but the contract expires in 2014 and will 
not be renewed due to the relatively low success rate achieved by the 
contractor. After the contract expires, state employees will provide 
these services instead, which officials believe will be a better use 
of resources. Similarly, we identified two additional states that have 
opted to have state employees provide SSI/DI advocacy services. 

State SSI/DI Advocacy Contracts May Account for a Small Proportion of 
Disability Claims Nationwide, but Other Third-Party Contracts May Be 
More Prevalent: 

While state and county SSI/DI advocacy contracts may account for a 
small proportion of disability claims nationwide, SSI/DI advocacy 
contracts held by other third parties, such as hospitals and long-term 
disability insurance companies, may be more prevalent. Since 
information on SSI/DI advocacy contracts is not available in SSA's 
databases, and data on representatives, in general, are limited, we 
used available data from a 2014 SSA OIG report to estimate the 
percentage of claims associated with SSI/DI advocacy 
contracts.[Footnote 26] Specifically, these data indicate that 
nonattorney representatives working on behalf of a government entity 
accounted for an estimated 5 percent[Footnote 27] of all initial SSI 
and DI claims with nonattorney representatives adjudicated in 
2010.[Footnote 28] Claims from these government SSI/DI advocacy 
contracts represent about 1 percent of all initial SSI and DI claims 
in 2010. By comparison, data indicate that claims associated with 
contracts held by other third parties--specifically, hospitals and 
long-term disability insurance companies--were more prevalent, 
accounting for an estimated 30 percent of initial SSI and DI claims 
with nonattorney representatives adjudicated in 2010.[Footnote 29] 
(See figure 4.) 

Figure 4: Estimate of Initial SSI and DI Claims Adjudicated in 2010 
with Nonattorney Representatives, by Type: 

[Refer to PDF for image: pie-chart] 

Representatives working for an organization under contract with a 
government entity at the state or local level: 5%; 
Representatives working on behalf of other third-parties such as 
hospitals, medical providers or long-term disability insurance 
companies: 30%; 
Total, Representatives working for a third-party: 35%; 
Other representatives (who generally do not appear to be working under 
contract with a third-party): 65%. 

Source: GAO analysis of the Social Security Administration Office of 
the Inspector General’s sample of initial SSI and DI claims 
adjudicated in 2010 with nonattorney representatives. GAO-15-62. 

Note: Information available in the claim files allowed us to identify 
representatives from organizations working under contract with a 
government entity, as well as the likely involvement of other third 
parties. All estimates presented in this figure have a margin of error 
at the 95-percent confidence level of +/-10 percentage points or fewer. 

[End of figure] 

Selected Sites Represented Different Approaches to SSI/DI Advocacy but 
Were Similar in Many Respects: 

We selected three sites--Hawaii; Minnesota; and Westchester County, 
New York--to illustrate different approaches to SSI/DI advocacy, in 
terms of the number and types of organizations they contracted with 
and geographic coverage. Despite these differences, however, the three 
sites were similar in many respects. For example, all three sites 
articulated a similar goal for their SSI/DI advocacy contracts, 
targeted similar populations, and generally paid SSI/DI advocacy 
contractors only for approved claims, among other similarities (see 
table 1). See appendix II for more detailed information on each site. 

Table 1: Key Aspects of Selected Sites' SSI/DI Advocacy Practices: 

Hawaii: 
Contracting agency: State of Hawaii Department of Human Services[A]; 
History of contracting for SSI/DI advocacy: Contracted since late-
1980s; 
Number of contractor(s): 1[B]; As of July 2014, Hawaii's SSI/DI 
advocacy contractor is a subcontractor to a company that is contracted 
to provide medical and psychological evaluations for the state's cash 
assistance programs; 
Current contract period: July 1, 2014 - June 30, 2016; 
Type of organization(s): Nonprofit, legal aid organization[B]; 
Geographic coverage: Statewide; 
Goal of SSI/DI advocacy: "The goal of this project is to maximize 
receipt of Federal funds from the Social Security Administration 
(SSA), while maximizing assistance available to disabled applicants 
and recipients"; 
Populations served: 
* General Assistance (GA); 
* TANF; 
* Other programs (Temporary Assistance for Other Needy Families; 
Aid to the Aged, Blind, and Disabled); 
Compensation structure of contract; Payments for approved claims at 
the: 
* Initial level; 
* Reconsideration; 
* Hearings and Appeals Council levels: 
Pay for performance[D]; 
The state pays the primary contractor a flat monthly fee, but the 
primary contractor pays the SSI/DI advocacy subcontractor based on the 
number of approved claims; 
* Initial: $900; 
* Reconsideration: $1,325; 
* Hearing/Appeal: $1,650; 
For more details, see appendix II; 
Amount paid for SSI/DI advocacy services: $410,957; (state fiscal year 
2013); 
Number of SSI/DI claims approved: 342; (state fiscal year 2013). 

Minnesota: 
Contracting agency: Minnesota Department of Human Services; 
History of contracting for SSI/DI advocacy: Contracted since early-
1990s; 
Number of contractor(s): 55[C]; 
Current contract period: January 1, 2014 - December 31, 2015; 
Type of organization(s): 
* For-profit; 
* Nonprofit; 
* Nonprofit, legal aid organization; 
Geographic coverage: Statewide; some contractors provide services 
statewide, others only in certain regions; 
Goal of SSI/DI advocacy: "The goal of [Department of Human Services] 
SSI Advocacy is to help people on public programs who have 
disabilities to increase their incomes and decrease their state 
health care and benefit costs"; 
Populations served: 
* GA; 
* TANF; 
* Medical Assistance; 
* Foster care; 
* Other programs (Group Residential Housing, Refugee Cash Assistance); 
Compensation structure of contract; Payments for approved claims at 
the: 
* Initial level; 
* Reconsideration; 
* Hearings and Appeals Council levels: 
Pay for performance[E]: 
GA/Group Residential Housing: 
* Initial/Reconsideration: $1,500; 
* Hearing/Appeal: $2,750; 
For the payment structure for other programs, see appendix II; 
Amount paid for SSI/DI advocacy services: $1,960,700; (state fiscal 
year 2013); 
Number of SSI/DI claims approved: 1,112; (state fiscal year 2013). 

Westchester County, New York: 
Contracting agency: Westchester County Department of Social 
Services; 
History of contracting for SSI/DI advocacy: Contracted since 2003; 
Number of contractor(s): 1; 
Current contract period: July 1, 2014 - June 30, 2015; 
Type of organization(s): For-profit; 
Geographic coverage: Countywide; 
Goal of SSI/DI advocacy: The primary objective is to identify and/or 
establish Supplemental Security Income (SSI) and Social Security 
Disability Insurance (DI) benefits for both the foster care and 
Temporary Assistance for Needy Families (TANF)/Safety Net Assistance 
population. This Scope of Work will maximize the number of customers 
enrolled onto SSI/DI and enable Westchester County Department of 
Social Services (DSS) to reduce costs, while improving services to DSS 
customers; 
Populations served: 
* GA; 
* TANF; 
* Foster care; 
Compensation structure of contract; Payments for approved claims at 
the: 
* Initial level; 
* Reconsideration; 
* Hearings and Appeals Council levels: 
Pay for performance[E]: GA/TANF: 
* All levels: $3,000 for each medically favorable SSI/DI decision; 
For the payment structure for other programs, see appendix II; 
Amount paid for SSI/DI advocacy services: $380,000; (contract year 
2013, July 2012-June 2013); 
Number of SSI/DI claims approved: 136; (contract year 2013). 

Source: GAO analysis of selected site contracts and data, and 
interviews with state and county officials and contractors. 
GAO-15-62. 

[A] The Department of Human Services is also the parent agency for 
Hawaii's Disability Determination Service (DDS). 

[B] In January 2014, Hawaii issued a new request for proposals for 
SSI/DI advocacy that combined two prior contracts for SSI/DI advocacy 
and medical and psychological evaluations. As of July 2014, the 
effective date of the new contract, the SSI/DI advocacy services are 
subcontracted to a legal aid organization by a for-profit company that 
is contracted to provide medical and psychological evaluations for the 
state's cash assistance programs. Previously, the SSI/DI advocacy 
contract was a separate, stand-alone contract. 

[C] For the purposes of this report, we reviewed the contracts for the 
two contractors we selected. However, state officials told us that 
because they use a form contract, the two contracts we reviewed were 
similar to all 55 contracts. 

[D] The total amount paid under the contract (also includes medical 
and psychological assessments) is not to exceed approximately $5.8 
million per year. 

[E] There is no set cap on the number of awards or clients served. 

[F] The total amount of the contract is not to exceed $380,000 per 
year. 

[End of table] 

Goals of SSI/DI Advocacy: 

Each site articulated a two-part goal for its SSI/DI advocacy 
contract: maximizing assistance for individuals with disabilities 
while also reducing state or county expenditures. Helping individuals 
on state or county benefits apply for Social Security disability 
benefits is allowable under current program rules and may result in 
greater financial support to individuals and their families if they 
are eligible. In all three sites, the maximum SSI disability benefit 
was higher than the maximum benefit provided by General Assistance or 
TANF.[Footnote 30] For example, Minnesota officials explained that 
Minnesota's General Assistance benefits are lower than SSI.[Footnote 
31] In addition, individuals receiving SSI may also be eligible for 
other support programs, such as medical assistance and food 
assistance.[Footnote 32] At the same time, officials from all three 
sites told us that moving individuals off state benefit programs and 
onto federal disability programs has financial benefits for the state 
or county. As discussed earlier, when the federal government pays the 
SSI or DI benefits, states can use the funds saved for other purposes, 
such as expanding services or serving other individuals. 

Populations Served: 

All three sites targeted SSI/DI advocacy services to General 
Assistance and TANF populations. Each site also targeted recipients of 
at least one other program. For example, in addition to General 
Assistance and TANF, Minnesota's contract specified that recipients of 
a state-funded Group Residential Housing program are eligible for 
SSI/DI advocacy services. In another example, Westchester County's 
contract included children in foster care who may be eligible for SSI. 

Services Provided: 

The contractors we selected in the three sites[Footnote 33] generally 
reported providing similar services to the state or county, and to 
claimants, including performing an initial disability screening, 
assisting with filling out the SSI and/or DI application, and 
representing the claimant throughout the disability determination 
process. Each of the contractors reported receiving referrals from 
sources such as state or county caseworkers or TANF employment 
services contractors and then screening these individuals to identify 
those likely to meet Social Security disability criteria. For example, 
the Westchester County contractor receives monthly lists of 
individuals receiving General Assistance or TANF benefits who have 
been determined to be unable to work due to a disability. Contractor 
officials mail a letter to individuals on these lists, introducing 
their services and inviting individuals to call their toll-free number 
to set up an initial screening. Similarly, Hawaii's SSI/DI advocacy 
subcontractor reported that, under the new contract, it will receive 
referrals from the primary state contractor. The screening process 
varied across contractors; some had structured tools to guide the 
process while others had a more informal initial intake appointment. 

The four contractors we selected reported a wide range in the 
percentage of referrals for which applications were filed, from less 
than 20 percent for one contractor to over 90 percent for 
another.[Footnote 34] Further, contractors reported a range of 
approval rates, and the contractor that likely filed applications for 
the smallest percentage of referred individuals reported achieving the 
highest approval rates at SSA (over 80 percent) of the contractors for 
which we obtained data.[Footnote 35] However, there are a number of 
factors contributing to these rates that we could not examine, such as 
the nature and quality of the referrals and the level of the 
claimant's participation in the process. Two of the contractors noted 
that screening out obviously ineligible individuals benefits SSA in 
that the contractors are not contributing to SSA workloads by 
submitting claims unlikely to be approved. 

After the contractors determine that an individual is potentially 
eligible for federal disability benefits, they assist him or her with 
completing an application for SSI and/or DI. With the claimant's 
permission, staff from these organizations also become the claimant's 
appointed representative, which allows the staff person to interact 
with SSA on behalf of the claimant during the disability determination 
process.[Footnote 36] Representatives from these organizations told us 
they generally focus on gathering and summarizing available medical 
evidence rather than providing referrals to doctors and specialists to 
obtain new medical evidence. The contractors reported that they 
generally file concurrent applications for SSI and DI. They generally 
file the DI application online, but they differed in how they filed 
the SSI application. Two of the organizations we selected--the for-
profit contractor in Minnesota and the contractor in Westchester 
County--reported filling out the SSI application on the claimant's 
behalf,[Footnote 37] while the other two organizations reported 
sending or accompanying the claimant to the SSA field office to file 
the application. The organizations also reported supporting claimants 
up to the hearings and Appeals Council levels, if necessary. See table 
2 for a comparison of the SSI/DI advocacy services the contractors in 
our three selected sites reported providing. 

Table 2: SSI/DI Advocacy Services Provided by Selected Contractors in 
Three Sites: 

Initial screening: 
Hawaii: 
Legal aid organization: [Check]; 
Minnesota: 
Selected for-profit organization: [Check]; 
Selected nonprofit organization: [Check]; 
Westchester County, New York: 
For-profit organization: [Check]. 

File some or all of disability application online: 
Hawaii: 
Legal aid organization: [Check]; 
Minnesota: 
Selected for-profit organization: [Check]; 
Selected nonprofit organization: [Check]; 
Westchester County, New York: 
For-profit organization: [Check]. 

Complete SSI application on paper: 
Hawaii: 
Legal aid organization: [Empty]; 
Minnesota: 
Selected for-profit organization: [Check]; 
Selected nonprofit organization: [Empty]; 
Westchester County, New York: 
For-profit organization: [Check]. 

Send or accompany claimant to Social Security Administration field 
office to file for SSI: 
Hawaii: 
Legal aid organization: [Check]; 
Minnesota: 
Selected for-profit organization: [Empty]; 
Selected nonprofit organization: [Check]; 
Westchester County, New York: 
For-profit organization: [Empty]. 

Refer to medical providers or specialists, as needed: 
Hawaii: 
Legal aid organization: [Check]; 
Minnesota: 
Selected for-profit organization: [Check]; 
Selected nonprofit organization: [Check]; 
Westchester County, New York: 
For-profit organization: [Empty]. 

Remind client to attend required exams: 
Hawaii: 
Legal aid organization: [Check]; 
Minnesota: 
Selected for-profit organization: [Check]; 
Selected nonprofit organization: [Check]; 
Westchester County, New York: 
For-profit organization: [Check]. 

Arrange transportation to appointments: 
Hawaii: 
Legal aid organization: [Check]; 
Minnesota: 
Selected for-profit organization: [Check]; 
Selected nonprofit organization: [Check]; 
Westchester County, New York: 
For-profit organization: [Check]. 

File reconsideration or appeal: 
Hawaii: 
Legal aid organization: [Check]; 
Minnesota: 
Selected for-profit organization: [Check]; 
Selected nonprofit organization: [Check]; 
Westchester County, New York: 
For-profit organization: [Check]. 

Support client at hearing: 
Hawaii: 
Legal aid organization: [Check]; 
Minnesota: 
Selected for-profit organization: [Check]; 
Selected nonprofit organization: [Check]; 
Westchester County, New York: 
For-profit organization: [Check]. 

Source: GAO analysis of interviews with officials from selected 
contractors in the three sites. GAO-15-62. 

[End of table] 

The representatives in each site generally reported interacting 
frequently with local SSA field offices and, to a lesser extent, the 
state DDS, in conducting their SSI/DI advocacy work. For example, the 
for-profit contractor we selected in Minnesota had offices across the 
street from SSA's Minneapolis field office, and representatives from 
this contractor reported hand-delivering SSI paper applications. In 
another example, officials from the Westchester County contractor 
reported having good working relationships with all of the SSA field 
offices in the county, noting that their representatives typically 
talk with field office staff daily by phone. 

Staff we interviewed in each of the local field offices we selected 
generally had positive feedback on their interactions with 
representatives from the selected SSI/DI advocacy contractors. For 
example, they noted that the representatives are helpful and easier to 
get in touch with or more responsive than other representatives. In 
addition, staff we interviewed generally said that claims submitted by 
these representatives are of equal or better quality than claims 
submitted by other representatives. In general, the DDS staff we 
interviewed did not express an opinion on the responsiveness of the 
representative or on the overall quality of claims. 

Compensation: 

In each site, SSI/DI advocacy contractors were generally paid only for 
disability claims that SSA approved. Payments ranged from $900 to 
$3,000 per approved claim. One site paid the same amount for an 
approved claim, regardless of the level of the adjudication process in 
which it was approved, while contractors in two sites were paid higher 
amounts for claims approved at the reconsideration and/or hearings or 
Appeals Council levels. Two of the sites--Minnesota and Westchester 
County, New York--also offered payments for assisting claimants 
undergoing continuing disability reviews, which SSA conducts to 
determine whether individuals receiving benefits continue to meet 
program disability requirements.[Footnote 38] Hawaii was unique among 
the three sites in that the state paid the primary contractor a set 
monthly fee but the primary contractor paid the SSI/DI advocacy 
subcontractor per approved claim. 

The relatively "flat fee" compensation structure in the SSI/DI 
advocacy contracts differs from SSA's direct payment structure and may 
create an incentive for representatives to submit claims that can be 
favorably decided in a more timely manner. Whereas selected SSI/DI 
advocacy contractors' fees are a set amount, regardless of how long it 
takes to decide a claim, under the Social Security Act eligible 
representatives can elect to be paid by SSA directly out of a 
claimant's past-due benefits and potentially earn more when claims 
take longer to be approved. Their fee is a maximum of 25 percent of 
the past-due benefits for approved claims, up to $6,000.[Footnote 39] 

Funding Sources: 

All sites at least partially offset the costs of their advocacy 
contracts with federal Interim Assistance Reimbursement (IAR) funds 
from SSA. In two of the sites--Hawaii and Minnesota--officials 
reported that they received more IAR money than they spent on their 
SSI/DI advocacy contracts.[Footnote 40] Through the IAR program, SSA 
reimburses participating states for the assistance they provided to 
individuals while awaiting the approval of SSI benefits. In order for 
the state to receive reimbursement, the state must have the claimant 
sign a written authorization that allows the state to be paid out of 
the claimant's past-due benefits. 

Approved Claims: 

The number of individuals moved onto federal disability programs as a 
result of the SSI/DI advocacy contracts in all three sites accounted 
for a small percentage of the total number of approved SSI and DI 
claims in their respective states or county. Specifically, Minnesota 
was the largest of the three sites in all respects: amount paid under 
the contract, geographic reach, and number of approved claims. Yet the 
1,112 claims approved statewide in state fiscal year 2013 was 
relatively small compared to the roughly 24,000 disability claims 
approved by SSA in the state in calendar year 2012, the most recent 
year available.[Footnote 41] Similarly, Hawaii and Westchester 
County's 342 and 136 claims approved in state fiscal or contract year 
2013, respectively, each represented small proportions of all 
disability claims approved by SSA in the state or county in calendar 
year 2012.[Footnote 42] 

SSA's Controls over Representatives Providing SSI/DI Advocacy Services 
to States and Other Third Parties Are Limited: 

SSA Does Not Have Specific Controls and Readily Available Data on 
Representatives, Particularly Those Paid by States and Other Third 
Parties: 

SSA has a number of controls in place--including rules[Footnote 43] 
and regulations--related to appointed representatives in the 
disability determination process, but it does not have controls 
specific to organizations providing SSI/DI advocacy services to states 
and other third parties. SSA's existing controls over representatives 
include broad guidelines regarding who may represent disability 
claimants, including qualifications for attorneys and nonattorneys. 
SSA regulations also set forth specific rules of conduct that apply to 
all representatives.[Footnote 44] For example, representatives are 
required, with reasonable promptness, to obtain evidence in support of 
the claim, submit such evidence as soon as practicable, help claimants 
respond to requests for information from SSA as soon as practicable, 
and to be familiar with relevant laws and regulations. Representatives 
are prohibited from, among other things, knowingly collecting any fees 
in violation of applicable law or regulation. In addition, nonattorney 
representatives who wish to be eligible for direct payment of their 
fees out of a claimant's past-due benefits also must satisfy a number 
of statutory criteria. Nonattorney representatives who do not wish to 
be eligible for direct payment of their fees, such as those waiving 
direct payment and working under contract to a state or county, do not 
have to satisfy these criteria but are still required by SSA's 
regulations to be capable of giving valuable help to claimants and to 
have good character and reputation.[Footnote 45] 

SSA's controls apply to individual representatives, and not to the 
organizations they work for, including those under contract to states 
or other third parties, because SSA only conducts business with and 
recognizes individuals as representatives. In 2008, SSA issued 
proposed rules that would have recognized organizations, in addition 
to individuals, as representatives.[Footnote 46] In other words, under 
the proposed rules a claimant could appoint an organization or firm to 
represent them rather than a single individual from that organization. 
In the proposed rules, SSA stated that the business practices of those 
who represent claimants have changed, and many representatives 
practice in group settings and provide their services collectively to 
claimants. However, the agency did not issue final rules on this 
topic.[Footnote 47] SSA officials told us that they still believe that 
having organizations serve as appointed representatives would be 
beneficial, but the agency would face challenges implementing this 
change, including modifying SSA's current data systems. 

SSA also does not have readily available data on representatives, 
particularly those paid by third parties. Specifically, SSA's current 
data on representatives are limited, kept in separate systems, and are 
not used to monitor or report trends on claims with representatives 
(see table 3). In particular, SSA collects less information about 
representatives the agency does not directly pay out of claimants' 
past-due benefits, and information on these representatives is not 
tracked in SSA's data systems.[Footnote 48] 

Table 3: Key Limitations of SSA's Data on Representatives: 

Data limitations: Data elements are missing; 
Examples: 
* SSA does not systematically collect data on the organizations or 
firms that employ individual representatives. SSA officials stated 
that this information is only collected, as is required, for tax 
purposes.[A]; 
* SSA does not have information readily available on the number of 
appointed representatives who waive payment from SSA or from any 
source. This information is not tracked in SSA's systems; 
Effect: 
* SSA cannot identify or monitor trends related to the types of 
organizations representing claimants; 
* SSA is unable to report trends or assess risks related to 
representatives who waive direct pay (potentially a large proportion 
of represented claims). 

Data limitations: Data are stored in separate legacy systems; 
Examples: 
* Data on representatives are captured and stored in several different 
legacy systems, across multiple parts of the agency. For example, 
program data on SSI and DI are kept and analyzed separately, and data 
collected for one program may not be collected for the other program; 
* SSA staff must complete a number of steps, including developing 
software specifications, validation, and security procedures, to 
aggregate data on representatives; 
Effect: 
* Agency efforts to obtain summary data on representatives are 
resource intensive. 

Data limitations: Data not used to identify trends; 
Examples: 
* SSA does not routinely produce or analyze claims data related to 
appointed representatives. All requests for data on representatives 
are done on an as-needed basis; 
* SSA's only readily available data on representation is captured in 
the agency's Appointed Representative Database, which was created for 
the purpose of paying representatives and providing tax information to 
representatives and the Internal Revenue Service; 
Effect: 
* Without routine mechanisms for obtaining data and assessing risk 
related to representatives, including the risk of potential fraud, 
SSA's program integrity may be compromised. 

Data limitations: Data constraints for staff; 
Examples: 
* SSA's current systems do not have the ability to query all claims 
filed by a specific representative or organization[B]; 
* Various SSA regional, state DDS, and field office staff reported not 
being able to consistently obtain aggregate information on claims with 
representatives; 
Effect: 
* SSA staff cannot conduct routine data extracts and reports on claims 
associated with particular appointed representatives, which may be 
useful in some instances, such as when a representative has been 
sanctioned; 
* Several SSA staff we interviewed reported that, without access to 
data on claims with representatives, it is difficult to identify 
trends or patterns of potential misconduct and to improve business 
operations. 

Source: GAO analysis of Social Security Administration (SSA) documents 
and interviews with SSA officials describing SSA's systems and 
available data on representatives. 

[A] SSA officials noted that SSA must comply with all laws, including 
the Privacy Act and the Paperwork Reduction Act, when deciding what 
information it collects and maintains. 

[B] SSA's current systems do allow specific queries on claims, which 
enables staff to gather information on the representatives appointed to 
a particular case. In addition, there is a database that houses 
information on representatives who have been sanctioned, and this 
database can also be queried by staff. 

[C] SSA's current systems do allow specific queries on claims, which 
enables staff to gather information on the representatives appointed 
to a particular case. In addition, there is a database that houses 
information on representatives who have been sanctioned, and this 
database can also be queried by staff. 

[D] SSA's Office of Disability Adjudication and Review maintains data 
at the hearings level that identifies the number of claimants a 
representative has represented in the past and the number of claims 
currently pending with that representative. 

[End of table] 

Federal government internal control standards state that agencies 
should have adequate access to timely data and information, and 
mechanisms in place for routinely assessing risks related to 
interactions with entities and parties outside the government that 
could affect agency operations.[Footnote 49] In order to make timely 
and accurate decisions, identify trends, and assess risks--including 
those related to program integrity--SSA needs ongoing and up-to-date 
information on representatives. This is particularly important given 
that representatives have become increasingly involved at the initial 
levels of the disability determination process, according to our 
analysis of SSA data. 

SSA Has Several Initiatives That Could Improve Information on 
Representatives but Uncertainties Exist: 

SSA has several efforts under way to improve its collection and use of 
data as well as its ability to assess risks related to 
representatives. First, SSA recently initiated the Registration, 
Appointment, and Services for Representatives project, with the goal 
of providing staff more accurate, up-to-date information about the 
representatives who assist claimants in the disability process. SSA 
officials stated that the agency currently captures information on 
representatives in separate, stand-alone systems that are not well-
integrated, which has resulted in concerns about payment 
inefficiencies and privacy. SSA plans to integrate information from 
the various systems on representatives, creating one system as the 
sole source for information on representatives. SSA officials told us 
that the agency may identify new data elements related to 
representatives to capture in the system, such as the organizations 
they are associated with, but there currently is no plan to collect 
this information. 

Another facet of this initiative involves giving representatives 
expanded access to the disability eFolder, SSA's electronic system 
containing all of the documents pertaining to a disability 
claim.[Footnote 50] Once implemented, authorized and registered 
representatives will have the ability to view documents for their 
clients contained in the eFolder and download and print them. 
Officials from two professional organizations of representatives and 
some SSA staff we interviewed reported that giving representatives 
access to the eFolder would be beneficial. By requiring 
representatives to register to gain access, SSA could gather more 
information on representatives. According to SSA's vision statement 
for this project, successful implementation would provide SSA more 
readily available data--and enhanced abilities to respond to 
management requests for information--on representatives. However, as 
of September 2014, SSA officials reported that this project is in the 
early planning phase, future funding is uncertain, and no timeline for 
completion has been established. 

Enhanced collection and use of data on appointed representatives may 
also be important for planned initiatives related to the detection of 
potential fraud. SSA is in the early stages of exploring computerized 
tools to enhance efforts to systematically detect potential fraud. 

Using data from recent alleged fraud cases involving representatives, 
SSA plans to use computer analytics to examine various characteristics 
of disability claims and determine those which may be fraudulent. 
Known as predictive analytics, these computer systems and tools can 
help identify patterns of potentially fraudulent disability claims. 
However, as discussed earlier, SSA does not consistently collect some 
data that may aid in its analytics effort, such as information on the 
organizations or firms with which individual representatives may be 
associated. The absence of readily available data on representatives 
hinders SSA's ability to detect patterns of potential fraud. 
Specifically, SSA's current data systems do not allow staff to 
identify, in a timely manner, large volumes of claims with the same 
representative and the same impairments, which can be a risk factor 
for potential fraud, according to SSA officials we interviewed. 

SSA Does Not Coordinate with Third Parties Contracting for SSI/DI 
Advocacy, Which May Result in Overpayments: 

SSA does not coordinate its direct payments to representatives with 
states and other third parties that might also pay representatives. As 
a result, it is possible that both SSA and a state or third party 
could pay the representative, resulting in more than one payment. More 
specifically, under the current system of payments, a representative 
working under contract to a state could (1) request direct payment 
from SSA (deducted from the claimant's past-due benefits) for 
representing a particular claimant, and (2) also submit an invoice to 
the state requesting payment under the terms of the SSI/DI advocacy 
contract.[Footnote 51] Generally, SSA prescribes the maximum fee 
allowed, and representatives may not knowingly collect more than the 
fee that SSA authorizes them to receive for a case.[Footnote 52] 
However, we found that in cases involving SSI/DI advocacy payments, 
representatives might be able to collect payments from the state as 
well as through SSA fee withholding, totaling more than the authorized 
amount.[Footnote 53] Unless SSA and the state or other third party 
share information on their payments or have policies and procedures in 
place to prevent such cases, representatives may receive both SSA and 
state payments that total more than the SSA-authorized fee. 

In 2007, we reported on this risk of overpayments to representatives 
and recommended that SSA take steps to address it.[Footnote 54] 
However, SSA has not fully implemented our recommendation because SSA 
did not know which states were paying representatives or the true 
extent of the problem, according to a senior agency official. SSA has 
taken some steps to clarify authorized payments for representatives. 
For example, in 2011, SSA revised the form a claimant uses to appoint 
a representative (form 1696) to more clearly indicate how a 
representative would like to be paid. Specifically, the updated form 
requires representatives to declare whether they intend to be paid by 
(1) the claimant directly,(2) SSA, out of the claimant's past-due 
benefits, or (3) a third party.[Footnote 55] (See figure 5.)  

Figure 5: Comparison of Former and Updated Versions of SSA Form 1696: 
To Appoint a Representative: 

Refer to PDF for image: illustration] 

Former version of 1696 form: 

Part III (Optional): 

Waiver of Fee: 
I waive my right to charge and collect a fee under sections 206 and 
1631(d)(2) of the Social Security Act. I release my client (the 
claimant) from any obligations, contractual or otherwise, which may be 
owed to me for services I have provided in connection with my client's 
claim(s) or asserted right(s). 
Signature (Representative): 
Date: 
	
Part IV (Optional): 

Waiver 0f Direct Payment: 
by Attorney or Non-Attorney Eligible to Receive Direct Payment
I waive only my right to direct payment of a fee from the withheld 
past-due retirement, survivors, disability insurance or supplemental 
security income benefits of my client (the claimant). I do not waive 
my right to request fee approval and to collect a fee directly from my 
client or a third party. 

Signature (Representative Waiving Direct Payment): 
Date: 

Updated 1696 form: 

Part III: 

Fee Arrangement (Select an option, sign and date this section): 

* Charging a fee and requesting direct payment of the fee from 
withheld past-due benefits. (SSA must authorize the fee unless a 
regulatory exception applies.) 

* Charging a fee but waiving direct payment of the fee from withheld 
past-due benefits--I do not qualify for or do not request direct 
payment. (SSA must authorize the fee unless a regulatory exception 
applies.) 

* Waiving fees and expenses from the claimant and any auxiliary 
beneficiaries--By checking this block I certify that my fee will be 
paid by a third-party, and that the claimant and any auxiliary 
beneficiaries are free of all liability, directly or indirectly, in 
whole or in part, to pay any fee or expenses to me or anyone as a 
result of their claim(s) or asserted right(s). (SSA does not need to 
authorize the fee if a third-party entity or a government agency will 
pay from its funds the fee and any expenses for this appointment. Do 
not check this block if a third-party individual will pay the fee). 

* Waiving fees from any source--I am waiving my right to charge and 
collect any fee, under sections 206 and 1631(d)(2) of the Social 
Security Act. I release my client and any auxiliary beneficiaries from 
any obligations, contractual or otherwise, which may be owed to me for 
services provided in connection with their claim(s) or asserted 
right(s). 

Source: GAO analysis of SSA forms 1696. GAO-15-62. 

[End of figure] 

Although the revised form more clearly delineates allowable fee 
arrangements, SSA officials acknowledged that this overpayment 
vulnerability still exists. Officials told us that the agency would 
not know if a representative was paid from another source outside SSA. 
The agency is dependent upon the claimant or the third party to inform 
SSA about an overpayment to a representative. Although the updated 
appointment form makes it more clear that representatives must choose 
one type of fee arrangement, some SSA staff we interviewed reported 
that claimants often do not fully understand the forms they are 
signing or the implications. 

One state we studied has developed practices in an attempt to avoid 
these types of overpayments, but these practices are not universal. 
Officials in Minnesota stated that they recently began requiring 
contracted organizations to submit copies of their signed form 1696 so 
the state could verify that the representatives checked the 
appropriate box for payment. By looking more closely at the award 
notices SSA sends to claimants and representatives, state officials 
reported discovering three instances in 2014 when a representative did 
not check the appropriate box to waive direct payment from SSA and 
could have received an overpayment. Minnesota officials plan to work 
with a local SSA field office to conduct an audit of a sample of 
claims to identify such cases. According to a Minnesota official, this 
effort would begin in December 2014. Officials we interviewed in the 
other two selected sites reported that they do not require 
representatives from contracted organizations to submit these signed 
SSA forms, nor did they have plans to audit claims to detect 
overpayments. 

SSA does not systematically coordinate with states and other third 
parties on the payment of representatives.[Footnote 56] For example, 
SSA has not issued guidance to states or third parties or shared any 
best practices on preventing overpayments. SSA and state officials in 
Minnesota reported that as SSA expands representative access to the 
eFolder during the disability determination process, providing 
controlled third party access could efficiently facilitate the 
detection of potential overpayments. For example, states could use 
their access to portions of the eFolder to easily check the form 1696 
submitted by the representative and any additional documents, such as 
fee agreements, to prevent overpayment. However, SSA can only provide 
access to an eFolder if it is permissible under federal privacy 
laws.[Footnote 57] In general, coordination is important because the 
risk of overpayment goes beyond the 16 states we identified with state 
or county SSI/DI advocacy contracts. As discussed earlier, we 
estimated that about 30 percent of all initial disability claims with 
nonattorney representatives are potentially associated with SSI/DI 
advocacy contracts held by other third parties, such as hospitals and 
long-term disability insurers.[Footnote 58] 

Conclusions: 

SSI/DI advocacy, while serving a practical purpose for states, 
counties, and individuals, raises questions about the role third 
parties and representatives play in the disability determination 
process. Many of these questions--such as the extent of SSI/DI 
advocacy and the impact of this practice--cannot be answered because 
so little data exist. Since representatives are increasingly involved 
in this process and are working on behalf of a diverse set of third 
parties, it is critical that SSA management and employees have 
mechanisms for monitoring trends and patterns related to claims with 
representatives. SSA anticipates being able to combine data across its 
systems in order to evaluate data variations on representatives but 
those plans are under development. SSA's current efforts also face a 
number of uncertainties which, if left unaddressed, may undermine the 
agency's ability to improve data on representatives. In the absence of 
readily available data--particularly data on those representatives 
paid by third parties--SSA is poorly positioned to identify trends or 
patterns that may present risks to program integrity. 

One such risk is making overpayments to representatives who are also 
being paid by third parties. SSA has not taken steps to adequately 
eliminate this vulnerability. Without enhanced coordination between 
SSA and third parties, some representatives may improperly receive 
payments. This financial vulnerability presents a strong case for 
enhanced oversight over representatives in the disability 
determination process. 

Recommendations for Executive Action: 

As part of initiatives currently under way to improve agency 
information on claims with appointed representatives and detect 
potential fraud associated with representatives, the Commissioner of 
the Social Security Administration should consider actions to provide 
more timely access to data on representatives and enhance mechanisms 
for identifying and monitoring trends and patterns related to 
representation, particularly trends that may present risks to program 
integrity. Specifically, SSA could: 

* Identify additional data elements, or amendments to current data 
collection efforts, to improve information on all appointed 
representatives, including those under contract with states and other 
third parties; 

* Implement necessary policy changes to ensure these data are 
collected. This could include enhancing technical systems needed to 
finalize SSA's 2008 proposed rules that would recognize organizations 
as representatives; and: 

* Establish mechanisms for routine data extracts and reports on claims 
with representatives. 

To address risks associated with potential overpayments to 
representatives and protect claimant benefits, the Commissioner of the 
Social Security Administration should take steps to enhance 
coordination with states, counties, and other third parties with the 
goal of improving oversight and preventing and identifying potential 
overpayments. This coordination could be conducted in a cost-effective 
manner, such as issuing guidance to states and other third parties on 
vulnerabilities for overpayment; sharing best practices on how to 
prevent overpayments; or considering the costs and benefits, including 
any privacy and security concerns, of providing third parties 
controlled access to portions of the eFolder to facilitate the 
detection of potential overpayments. 

Agency Comments and Our Evaluation: 

We provided a draft of this product to the Social Security 
Administration (SSA) and the Department of Health and Human Services 
(HHS) for comment. SSA and HHS provided technical comments, which we 
have incorporated as appropriate. In its written comments, reproduced 
in appendix III, SSA partially agreed with our two recommendations and 
raised its overall concern that our report misrepresents and 
overstates the nature of states' payments to representatives. The 
agency did not provide any further support for this assertion; it is 
unclear the basis on which SSA could make this statement, given that 
officials repeatedly told us during the course of our work that the 
agency has no information or data on states' contracts. Our report 
makes it clear that the full extent of states' and counties' SSI/DI 
advocacy practices is unknown, given the absence of national-level 
data. Given these limitations, we believe that our work fairly and 
accurately describes what is known about the extent of SSI/DI advocacy 
contracts and payments nationwide. 

SSA also noted that our report did not address other types of SSI/DI 
advocacy contracts, such as those held by insurance companies. Indeed, 
it was not within the scope of our report to do so. We did note that 
other types of SSI/DI advocacy contracts--such as those held by 
insurance companies or hospitals--represented an estimated 30 percent 
of initial disability claims with nonattorney representatives in 2010. 
The prevalence of these SSI/DI advocacy contracts, and the growing 
involvement of representatives at the initial disability determination 
level, presents a strong case for SSA to have greater information on 
these third parties and the payments they may receive. 

SSA partially agreed with our first recommendation to consider actions 
to provide more timely access to data on representatives and enhance 
mechanisms for identifying and monitoring trends and patterns related 
to representation. SSA acknowledged that the report accurately 
describes initiatives the agency has underway to improve the use and 
collection of data related to representatives. SSA stated that, as 
part of these efforts, the agency may identify additional data 
elements that may be helpful to collect and consider any necessary 
policy changes. SSA raised concerns, however, that expanding data 
collection to a more detailed level could negatively affect other 
agency priorities. We fully acknowledge that SSA has competing 
priorities and limited resources. With this in mind, we wrote the 
recommendation to provide SSA flexibility in implementation, including 
suggesting that the agency leverage current initiatives. We continue 
to believe that SSA should consider steps to improve available data on 
appointed representatives to better monitor the involvement of these 
third parties in the disability determination process. 

SSA partially agreed with our second recommendation to take steps to 
enhance coordination with states, counties, and other third parties 
with the goal of improving oversight and preventing and identifying 
potential overpayments. In its general comments, SSA stated that its 
rules allow representatives to receive fee payments, and that any 
payments made by states are outside of SSA's authority for oversight 
purposes. SSA also stated that our report did not provide sufficient 
evidence to warrant enhanced coordination and noted that the agency 
takes the necessary actions to recoup fees when it learns of a 
potential fee violation. Our report notes, however, that SSA is 
dependent upon the claimant or the third party to inform SSA about an 
overpayment to a representative. In our audit work in selected states, 
we also noted three instances when a representative attempted to be 
paid by SSA and the state. While we recognize that payments made by 
states to representatives are outside of SSA's jurisdiction, SSA has 
established rules of conduct for representatives, and these rules 
prohibit a representative from collecting fees over the amount SSA has 
authorized. Enhanced coordination could increase SSA's and third party 
payers' ability to detect potential overpayments. 

Finally, SSA suggested that we explicitly state in our report that we 
did not find any indications of fraud committed by representatives 
working under contracts to states or other third parties (referred to 
by SSA in its comments as "facilitators"). The objectives of this work 
were focused on (1) identifying the extent to which states are 
involved in SSI/DI advocacy, (2) examining different approaches to 
this work, and (3) assessing the key controls that SSA has in place to 
ensure that organizations working under contract to states and other 
third parties follow program rules and regulations. As such, we did 
not have any findings on the extent of any possible fraudulent 
activity associated with these SSI/DI advocacy contracts. We do note 
in the report, however, that SSA field office staff we interviewed in 
our three selected sites generally had positive feedback on their 
interactions with representatives working under contract to the state 
or county, and that claims they submitted were of the same or better 
quality than claims submitted by other representatives. 

As agreed with your office, unless you publicly announce its contents 
earlier, we plan no further distribution of this report until 30 days 
from its issue date. At that time, we will send copies of this report 
to the appropriate congressional committees, the Secretary of the 
Department of Health and Human Services, the Commissioner of the 
Social Security Administration, and other interested parties. In 
addition, the report will be made available at no charge on the GAO 
website at [hyperlink, http://www.gao.gov]. 

If you or your staff have any questions about this report, please 
contact me at (202) 512-7215 or bertonid@gao.gov. Contact points for 
our Offices of Congressional Relations and Public Affairs may be found 
on the last page of this report. GAO staff who made key contributions 
to this report are listed in appendix IV. 

Signed by: 

Daniel Bertoni: 
Director, Education, Workforce, and Income Security: 

[End of section] 

Appendix I: Objectives, Scope, and Methodology: 

In conducting our review of state Supplemental Security Income 
(SSI)/Disability Insurance (DI) advocacy practices, our objectives 
were to examine (1) what is known about the extent to which states are 
contracting with private organizations to identify and move eligible 
individuals from state-or county-administered benefit programs to 
Social Security disability programs, (2) how SSI/DI advocacy practices 
compare across selected sites, and (3) the key controls the Social 
Security Administration (SSA) has in place to ensure these 
organizations follow SSI/DI program rules and regulations. We 
conducted this performance audit from September 2013 through December 
2014 in accordance with generally accepted government auditing 
standards. These standards require that we plan and perform the audit 
to obtain sufficient, appropriate evidence to provide a reasonable 
basis for our findings and conclusions based on our audit objectives. 
We believe that the evidence obtained provides a reasonable basis for 
our findings and conclusions based on our audit objectives. 

This appendix provides a detailed account of the data sources used to 
answer these questions, the analyses we conducted, and any limitations 
we encountered. The appendix is organized into three sections. Each 
section presents the methods we used for the corresponding objective. 
Specifically, section I describes the information sources and methods 
we used to identify state SSI/DI advocacy contracts, estimate the 
proportion of claims associated with these contracts, and analyze 
national trends in claims with representatives. Section II describes 
the information sources and methods we used to explore selected SSI/DI 
advocacy approaches. Section III describes the information sources and 
methods we used to assess SSA's policies and controls related to 
representatives. 

Section I: Identifying the Extent of State SSI/DI Advocacy Contracts: 

To determine the extent to which states are contracting with private 
organizations for SSI/DI advocacy services, we used a multi-faceted 
approach. Due to the absence of national-level data on SSI/DI advocacy 
contracts, we combined information from various sources. Specifically, 
we analyzed data from SSA's Office of the Inspector General (OIG); 
performed independent research, including conducting Internet searches 
and following up on contracts identified in past GAO work; and 
interviewed government officials, representatives from organizations 
providing SSI/DI advocacy services, and a wide range of stakeholders 
and experts. 

Data Analysis: 

Analysis of a Random Sample of Social Security Disability Claims: 

We used data from a 2014 report issued by SSA's OIG to estimate the 
percentage of initial claims in 2010 with nonattorney representatives 
working under a government SSI/DI advocacy contract, as well as the 
percentage that were potentially working under contract with another 
third party, such as a hospital or long-term disability insurance 
company.[Footnote 59] 

As part of its report, the OIG selected a random sample of 275 SSI and 
DI adjudicated claims from the population of 857,855 adjudicated 
claims with a representative in calendar year 2010, 201 of which were 
for initial claim determinations. Of these 201 initial claim 
determinations, 83 were represented by nonattorney representatives, 
while the remainder had attorney representatives. The OIG used 
information in the claim files, as well as Internet research, to 
determine the type of nonattorney representative associated with each 
sampled claim. The OIG did not conduct similar work for claims with 
attorney representatives. 

We independently reviewed and verified the OIG's work papers for the 
sampled claims with a nonattorney representative, including selected 
documents from the electronic claim files. To verify that the OIG's 
categorizations of the type of representative were correct, we 
completed a blind categorization of the type of representative 
involved in each claim (that is, we completed our own categorization 
of the type of representative, without first reviewing the OIG's 
determination) for the sample of 83 cases. A second analyst then 
confirmed the categorization. We discussed any discrepancies between 
our categorizations and the OIG's with the OIG staff who performed the 
work. We obtained additional information about the claim in several 
cases and documented the final categorization. Using methods 
appropriate for a simple random sample, we estimated the percentage of 
initial claims with determinations in 2010 with nonattorney 
representatives working under SSI/DI advocacy contracts with 
government entities, as well as the percentage that were potentially 
working under contract with another third party, such as a hospital or 
long-term disability insurance company. Because the sample was 
selected using a probability procedure based on random selections, the 
sample is only one of a large number of samples that might have been 
drawn. Since each sample could have provided different estimates, we 
express our confidence in the precision of our particular sample's 
results as a 95-percent confidence interval (e.g., plus or minus 7 
percentage points). This is the interval that would contain the actual 
population value for 95 percent of the samples we could have drawn. 
All estimates in this report have a margin of error, at the 95-percent 
confidence level, of plus or minus 10 percentage points or fewer. 
Based on our discussions with the OIG and our verification process, we 
determined that the estimates were sufficiently reliable for the 
purposes of this report. 

Analysis of SSA Data on Trends in Representation: 

We also analyzed SSA data extracted from the Appointed Representative 
Database, the Modernized Claims System, and the Supplemental Security 
Income Record, for calendar years 2004-2013 to provide information 
regarding total SSI and DI claims as well as claims with attorney and 
nonattorney representatives, as context for our findings. We 
interviewed SSA officials regarding these data and reviewed the 
computer code SSA used to extract these data, and determined they were 
sufficiently reliable for these purposes. 

Review of Prior GAO Work and Internet Research: 

To identify states and counties that were likely to have an SSI/DI 
contract, we followed up on prior GAO work and performed Internet 
research. Specifically, we contacted officials in the states that, in 
2007, reported paying representatives to assist individuals with their 
SSI claims to determine if these payments were part of a contract and, 
if so, if the contract was still in place as of 2014.[Footnote 60] We 
also performed an Internet search to identify additional SSI/DI 
advocacy contracts or requests for proposals. Using a uniform set of 
search terms, we performed this search for all states (and the 
District of Columbia) for which we did not have information regarding 
their potential SSI/DI advocacy contracting activity from our 
interviews (see below). We confirmed the status of these contracts or 
proposals with state, county, or city officials, as appropriate. 

Interviews: 

To supplement our data analyses and Internet searches, we conducted 
interviews with a number of stakeholders to learn more about this 
contracting practice and obtain leads for states that may have current 
SSI/DI advocacy contracts. Specifically, we interviewed officials from 
SSA and the Department of Health and Human Services (HHS) to determine 
what information each agency collected and maintained regarding state 
contracts for SSI/DI advocacy. Through these interviews, we also 
explored what other data were readily available that could be used to 
determine the extent of this contracting practice. 

To obtain leads on potential state or county contracts, we worked with 
two professional groups--the National Association of State TANF 
Administrators and the National Council of Disability Determination 
Directors--who contacted their members on our behalf. 

With regard to state or county contracts identified through these 
interviews and from information provided through these professional 
groups, we followed up directly with state or county officials to 
confirm this information. 

To learn more about this contracting practice and obtain leads for 
states that may have current SSI/DI advocacy contracts, we also 
interviewed researchers at academic and advocacy organizations. These 
included: 

* American Enterprise Institute: 

* American Public Human Services Association: 

* Center on Budget and Policy Priorities: 

* Center for Law and Social Policy: 

* Consortium for Citizens with Disabilities: 

* Federal Reserve Bank of San Francisco: 

* Mathematica Policy Research: 

* MDRC: 

* National Association of Disability Examiners: 

* National Association of Disability Representatives: 

* National Association of State TANF Administrators: 

* National Council of Disability Determination Directors [representing 
state Disability Determination Services (DDS) directors] 

* National Council of Social Security Management Associations 
(representing SSA field office and teleservice center managers): 

* National Organization of Social Security Claimants' Representatives: 

* Social Security Advisory Board: 

In addition, we interviewed representatives from organizations that, 
based on our preliminary audit work, were providing SSI/DI advocacy 
services to states or counties. These included Chamberlin Edmonds, the 
Legal Aid Society of Hawaii, MAXIMUS, Public Consulting Group, and 
South Metro Human Services. We also interviewed officials from Policy 
Research Associates, which provides technical assistance, under a 
contract to the Substance Abuse and Mental Health Services 
Administration, for the national SSI/SSDI Outreach, Access and 
Recovery (SOAR) program. 

Section II: Exploring Selected SSI/DI Advocacy Approaches: 

In order to obtain in-depth information on the different ways in which 
states and counties contract with private organizations for SSI/DI 
advocacy services, we selected a nongeneralizable sample of three 
sites with SSI/DI advocacy contracts that had an established history 
of contracting for SSI/DI advocacy services and represented a variety 
of approaches. We also selected one state in which the Temporary 
Assistance for Needy Families (TANF) administering agency and the 
state DDS were divisions under the same state agency, in light of 
concerns about potential conflicts of interest (the agency issuing the 
contract to help people apply for federal disability benefits is under 
the same state agency as the agency making the decision about 
eligibility for federal disability benefits). 

Specifically, we selected (1) a state that contracts with a nonprofit, 
legal aid organization (Hawaii)[Footnote 61], (2) a state that 
contracts with multiple organizations, including for-profit, 
nonprofit, and legal aid organizations (Minnesota), and (3) a county 
that contracts with a for-profit company (Westchester County, New 
York). 

In each site, we obtained key documents--such as the request for 
proposals and the signed, current contracts--and data in order to 
describe the various aspects of the sites' SSI/DI advocacy practices. 
For example, we gathered information on how the states or county and 
their contractors identified potentially eligible individuals, the 
types of services provided by the organizations to claimants, 
compensation structures, and other information. We obtained data on 
the total amounts paid to the contractors in state fiscal year or 
contract year 2013. We also obtained information on how the site funds 
its SSI/DI advocacy contracts, and whether any funding was provided 
through an Interim Assistance Reimbursement (IAR) agreement with SSA. 
We collected and analyzed available data from the three sites on the 
number of individuals referred to the contractor and the number of 
claims filed and approved by SSA in state fiscal year 2013, or the 
most recent complete year available. We interviewed state/county and 
contractor officials knowledgeable about the data and compared 
states'/counties' and contractors' reported data and determined the 
data were sufficiently reliable for our purposes. To put these sites' 
data on approved claims in context, we also obtained data from SSA on 
the number of SSI and DI approved claims in each state or county in 
calendar year 2012, the most recent year these federal data were 
available. 

In each site, we also conducted in-depth interviews with (1) the 
government agency administering the contract, (2) officials from the 
organization(s) working under the contract,[Footnote 62] (3) SSA 
officials in the relevant regional office and at least one field 
office,[Footnote 63] and (4) state DDS administrators and staff. 
[Footnote 64] In the field offices and state DDSs, we randomly 
selected staff to interview who met certain qualifications. We 
conducted these interviews either in person or by phone. We also 
contacted the state auditors for each state, and in all three sites, 
they confirmed they had no current work regarding SSI/DI advocacy 
contracting, nor had they done any work in this area within the past 
10 years. 

Prior to issuing this report, we shared a statement of facts with 
officials from the state or county agency and the selected 
contractor(s) in the three sites to confirm that the key information 
used to formulate our analyses and findings were current, correct, and 
complete. These entities provided technical comments, which we 
incorporated, as appropriate. 

Section III: Assessing SSA Policies and Controls Related to 
Representatives: 

In order to assess the controls SSA has in place related to 
representatives contracted by third-party organizations to perform 
SSI/DI advocacy, we reviewed relevant documents and reports, and 
conducted interviews with key officials from SSA. 

Review of Documents Describing SSA's Controls: 

We reviewed relevant federal laws; proposed and final regulations; 
program policies and procedures, such as SSA's Program Operations 
Manual System; and other program documentation, as well as reports and 
testimonies from SSA, SSA's OIG, and the Social Security Advisory 
Board. We compared SSA's efforts with their own policies and 
procedures, federal government internal control standards, and prior 
recommendations from GAO and the Social Security Advisory Board. 

Interviews with SSA Officials: 

To understand SSA's policies, procedures, and data controls related to 
appointed representatives, we interviewed officials in a number of SSA 
departments in headquarters. These included: 

* Office of Disability Adjudication and Review: 

* Office of Disability Determinations: 

* Office of Disability Programs: 

* Office of Income Security Programs: 

* Office of the Inspector General: 

* Office of Research, Evaluation, and Statistics: 

* Office of Retirement and Survivors Insurance Systems: 

To gain additional perspectives on how SSA policies are implemented 
and challenges regarding appointed representatives in the disability 
determination process, particularly those under contract to a state or 
county, we incorporated relevant questions into the interviews 
conducted in our three selected sites. Also, as noted above, we 
interviewed representatives from national organizations representing 
SSA field office managers, administrative law judges, DDS 
administrators, and DDS examiners. 

[End of section] 

Appendix II: SSI/DI Advocacy Practices in Selected Sites: 

Hawaii: 
Services Provided by the Nonprofit Legal Aid Organization in Hawaii: 

Contract snapshot: 

* Current contract period: July 1, 2014 – June 30, 2016; 

* Amount paid under the contract: $410,957 (state fiscal year 2013); 

* Approved claims: 342 (state fiscal year 2013). 

Contractor(s): 

* Nonprofit legal aid organization, a subcontractor to a for-profit 
company. 

Compensation structure: 

Payment received for each approved claim: 
* Initial level: $900; 
* Reconsideration: $1,325; 
* Appeal: $1,650. 

Targeted populations: 
* GA; 
* TANF; 
* Other programs: Aid to the Aged, Blind, and Disabled; Temporary 
Assistance for Other Needy Families. 

Sources: GAO analysis of Hawaii SSI/DI advocacy contract and 
interviews with state officials and contractors, as confirmed by state 
and contractor officials; National Atlas of the United States of 
America (map). 

Approach to SSI/DI advocacy: 

In the beginning of 2014, Hawaii had a contract with a legal aid 
organization to provide Supplemental Security Income (SSI)/Disability 
Insurance (DI) advocacy services statewide. In July 2014, this 
organization became a subcontractor to a company that performs medical 
and psychological evaluations for the state’s cash assistance 
programs. Specifically, the primary contractor is responsible for 
determining whether applicants and recipients of the state’s General 
Assistance (GA) and Temporary Assistance for Needy Families (TANF) 
programs have disabilities that prevent them from engaging in work at 
a certain level. Previously, the state had two separate contracts for 
SSI/DI advocacy and medical and psychological evaluations. State 
officials told us that they combined those services into a single 
contract, in part, to streamline the referral process for SSI/DI 
advocacy. If the primary contractor determines that an individual’s 
disability meets Social Security criteria, they refer the individual 
directly to their advocacy subcontractor rather than indirectly 
through state caseworkers, as was done under the prior contract. 

Disability screening process: 

Previously, a prospective claimant could be referred by a state 
caseworker or walk into the legal aid office. Referrals now come from 
the primary contractor. Hawaii’s SSI/DI advocacy subcontractor told us 
they conduct a screening assessment to obtain basic information—such 
as information on the individual’s impairments, the doctors they have 
seen, and medications they are taking—and have the claimant sign key 
forms, including the Social Security Administration (SSA) form 
required to formally appoint the advocacy worker as their 
representative. If an individual does not appear eligible for federal 
disability benefits, the representative would decline to officially 
represent them but might provide some assistance. 

Assistance filing a claim: 

Hawaii’s SSI/DI advocacy subcontractor reported that most 
representatives fill out available portions of the SSA disability 
application online, such as the DI portion. They call the local SSA 
field office to schedule an appointment for the claimant to meet with 
an SSA claims representative to complete the SSI portion of the 
application, which is not available online. They said representatives 
typically do not accompany the claimant to the field office, nor do 
they refer claimants to doctors or medical specialists.
Representation during the disability determination process
The advocacy subcontractor reported that its representatives will 
provide additional information to SSA or the state Disability 
Determination Services (DDS) on the claimant’s disabilities or 
functioning, upon request. The representative may also check to ensure 
the claimant attends any examinations scheduled by the DDS. If an 
initial application is denied, the representative may schedule another 
appointment with the claimant to review the case and determine whether 
to file a reconsideration or, later, an appeal. 

[End of Hawaii fact sheet] 

Minnesota: 
Services Provided by Organizations under Contract to Minnesota: 

Contracts snapshot: 
* Current contract period: January 1, 2014 – December 31, 2015; 

* Amount paid under SSI/DI advocacy contracts: $1,960,700 (state 
fiscal year 2013); 

* Approved claims: 
- Total: 1,112 (state fiscal year 2013); 
- Largest for-profit contractor[A]; 
- Largest non-law, nonprofit contractor: 45 (calendar year 2013); 

[A] The contractor requested that this information not be included in 
this report. 

Contractor(s): 

55 total: 
* 39 nonprofit organizations; 
* 13 for-profit organizations (including law firms); 
* 3 legal aid organizations. 

Compensation structure: 

Payment for each approved claim: 

* Initial level/reconsideration: 
$1,500 [individuals on GA or Group Residential Housing (GRH)]; or
$1,250 (for individuals on other eligible programs); or
$2,500 under SOAR; 

* Appeal: 
$2,750 (for individuals on GA or GRH); or
$2,500 (for individuals on other eligible programs). 

Other payments: 
* Continuing disability review (CDR): $750; 

* Successful SSI claims for current non-disability Social Security 
recipients: $750. 

Targeted populations: 

SSI/DI Advocacy: 
* GA; 
* TANF; 
* Medical Assistance; 
* Foster care; 
* Other programs: GRH, Refugee Cash Assistance. 

SOAR: 
* Homeless individuals with mental impairments. 

Sources: GAO analysis of selected Minnesota SSI/DI advocacy contracts 
and interviews with state officials and contractors, as confirmed by 
state and contractor officials; National Atlas of the United States of 
America (map). 

Approach to SSI/DI advocacy: 

In 2014, Minnesota contracted with 55 organizations across the state, 
ranging from small law firms to large for-profit and nonprofit 
organizations.[Footnote 1] Some organizations served individuals 
statewide, while others served specific geographic areas or 
populations, such as tribal communities. 

Minnesota’s request for proposals for SSI/DI advocacy services had two 
components: one for its general SSI/DI advocacy program and another 
for its SSI/SSDI Outreach, Access, and Recovery (SOAR) program. 
Minnesota’s SOAR program is based on a national advocacy model that 
focuses on homeless individuals or individuals at risk of homelessness 
who have a mental illness and/or a co-occurring substance abuse 
disorder. Organizations could submit proposals to provide services 
under one or both components. Minnesota offered higher payments under 
the SOAR program because, according to state officials, the homeless 
population requires more intensive services. Specifically, the state 
provided a $2,500 payment for approved applications that included a 
complete medical summary report-—a key component of the SOAR model. 
[Footnote 2] 

Disability screening process: 

Officials at the for-profit contractor we selected—operating under the 
SSI/DI advocacy component of the contract—reported that they receive 
referrals from county or hospital caseworkers. Officials at the 
nonprofit contractor we selected—operating mainly under the SOAR 
component of the contract—reported that it receives informal referrals 
from staff at homeless shelters or mental health or urgent care 
clinics. The for-profit officials also reported having limited access 
to a state database, which allows them to verify that a referred 
individual is a recipient of one of the eligible state programs. Both 
organizations conduct initial screenings to obtain information, such 
as the individual’s impairments and work history. The nonprofit 
organization also gathers information on the individual’s history of 
homelessness. If it appears that the individual will meet Social 
Security disability criteria, both organizations’ staff reported that 
they will meet with the claimant to fill out the application and sign 
key forms, including the form required to formally appoint the SSI/DI 
advocacy staff as their representative. 

Assistance filing a claim: 

Representatives from both organizations reported filling out available 
portions of the application online, such as the DI portion, but they 
differed in how they completed the SSI portion of the application, 
which is not available online. Representatives from the for-profit 
organization fill out the SSI application on behalf of the claimant 
and either mail or hand-deliver it to the local SSA field office. 
Representatives from the nonprofit organization typically accompany 
the claimant to the field office to complete the application and often 
provide transportation to ensure the claimant attends the appointment.
Representatives from both organizations said they typically gather 
available medical information but refer the claimant to medical 
providers or specialists, as needed, if the existing records are 
insufficient. The nonprofit organization also has a psychologist on 
staff to perform evaluations and psychological testing if existing 
records are insufficient. 

Representation during the disability determination process: 

Representatives from both organizations work with the claimant to 
ensure he or she attends any examinations the DDS schedules and 
provide the DDS, upon request, with additional information on the 
claimant’s disabilities or functioning. If an initial application is 
denied, the representatives will review the case with the claimant and 
determine whether to file a reconsideration or, later, an appeal. 

Footnotes: 

[1] For the purposes of this report, we reviewed the contracts for the 
two contractors we selected. However, state officials told us that 
because they use a form contract, the two contracts we reviewed were 
similar to all 55 contracts. 

[2] According to officials from the national SOAR Technical Assistance 
Center, the medical summary report is a letter written by the 
representative working on the application that includes information on 
the claimant’s physical and/or mental impairments, as well as 
information on how these impairments prevent the claimant from being 
able to work. In addition, under SOAR, the state provides 
reimbursement for expenses incurred in obtaining medical documentation 
for a claim, as well as initial start-up funds, which are based on the 
number of approved claims the contractor expects to receive. 

[End of Minnesota fact sheet] 

Westchester County, New York: 
Services Provided by the For-profit Organization under Contract to 
Westchester County: 

Contract snapshot: 

* Current contract period: July 1, 2014 – June 30, 2015; 

* Amount paid under the contract: $380,000 (Contract year 2013, July 
2012-June 2013); 

* Approved claims: 136 (Contract year 2013). 

Contractor(s): 

* For-profit company with a national scope. 

Compensation structure: 

Payment for each approved claim: 
* $3,000 (adult disability claim); 
* $2,000 (foster care SSI claim); 
* $1,500 (CDR). 

Targeted populations: 

* GA (known as Safety Net Assistance); 
* TANF; 
* Foster care. 

Sources: GAO analysis of Westchester County SSI/DI advocacy contract 
and interviews with county officials and the contractor, as confirmed 
by county and contractor officials; National Atlas of the United 
States of America (map). 

Approach to SSI/DI advocacy: 

Westchester County’s contractor, a national for-profit organization, 
performed its SSI/DI advocacy services from its office in another 
state. Officials from Westchester County and the organization told us 
that providing services by phone can be particularly beneficial for 
individuals with severe disabilities. 

Disability screening process: 

Westchester County’s SSI/DI advocacy contractor reported that it 
receives referrals on a monthly basis from the county’s three 
employment services contractors. According to county officials, these 
contractors identify people receiving GA or TANF who are unable to 
work for reasons such as a disability, and provide lists of these 
people to the SSI/DI advocacy contractor. The advocacy contractor 
mails a letter to each referred individual, introducing their services 
and inviting them to call a toll-free number to determine their 
potential eligibility for Social Security disability benefits. During 
this screening, a representative from the organization gathers 
information on the individual’s current medical condition, work 
history, and educational level. If it appears that the individual will 
meet Social Security disability criteria, the representative will fill 
out the application and have the claimant sign key forms, including 
the form required to formally appoint the SSI/DI advocacy worker as 
their representative. 

Assistance filing a claim: 

Officials from the advocacy organization said that representatives 
fill out available portions of the disability applications online, 
such as the DI application. The representative also fills out the SSI 
application on behalf of the claimant and mails it to the appropriate 
SSA field office. Representatives gather available medical 
information, but do not refer claimants to additional doctors or 
specialists. Instead, if claimants have a limited medical history, the 
representatives will refer them to the county for treatment or request 
that their physicians provide treatment notes or an assessment of 
their functioning. 

Representation during the disability determination process: 

Representatives work with the claimant to ensure he or she attends any 
examinations the DDS schedules and provide the DDS with additional 
information on the claimant’s disabilities or functioning, upon 
request. If an initial application is denied, the representative will 
review the case and schedule a telephone appointment with the claimant 
to discuss options and determine whether to file a request for a 
hearing. 

[End of Westchester County fact sheet] 

[End of section] 

Appendix III: Comments from the Social Security Administration: 

Social Security: 
Office of the Commissioner: 
Social Security Administration: 
Baltimore, MD 21235-0001: 

November 10, 2014: 

Mr. Dan Bertoni: 
Director, Education, Workforce, and Income Security Issues: 
United States Government Accountability Office: 
441 G Street, NW: 
Washington, DC 20548: 

Dear Mr. Bertoni: 

Thank you for the opportunity to review the draft report, "Social 
Security Disability Benefits: Agency Could Improve Oversight of 
Representatives Providing Disability Advocacy Services" (GAO-15-62). 
Our response is enclosed. 

If you have any questions, please contact me at (410) 966-9014. Your 
staff may contact Gary S. Hatcher, our Senior Advisor for Records 
Management and Audit Liaison Staff, at (410) 965-0680. 

Sincerely, 

Signed by: 

Katherine Thornton: 
Deputy Chief of Staff: 

Enclosure: 

Comments On The Government Accountability Office (GAO) Draft Report, 
"Social Security Disability Benefits: Agency Could Improve Oversight 
Of Representatives Providing Disability Advocacy Services" (GAO-15-62): 

General Comments: 

Social Security disability benefits are a vital safety net for those 
Americans who meet our disability criteria. State and other entities' 
efforts to help individuals receive much-needed disability benefits 
serve an important role in ensuring the economic stability for one of 
our most vulnerable populations. We believe this report misrepresents 
and overstates the nature of States' payments to representatives. Our 
rules permit representatives to receive fee payments. State fee 
payments are outside our authority for oversight purposes. Also, while 
the report focused on States, it did not address the other entities 
GAO identified, i.e., private insurance companies who require their 
policyholders to file Social Security disability claims. Finally, 
GAO's results did not indicate any acts of possible fraud committed by 
the facilitators. The report should also make that clear. 

Responses To The Recommendations: 

Recommendation 1: 

Consider actions to provide more timely access to data on 
representatives and enhance mechanisms for identifying and monitoring 
trends and patterns related to representation, particularly trends 
that may present risks to program integrity. Specifically, SSA
could: (I) identify additional data elements, or amendments to current 
data collections efforts, to improve information on all appointed 
representatives, including those under contract with States and other 
third parties; (2) implement necessary policy changes to ensure these 
data are collected; and (3) establish mechanisms for routine data 
extracts and report on claims with representatives. 

Comment: 

We partially agree. The report correctly acknowledges that we have a 
number of initiatives underway to improve our use and collection of 
data related to appointed representatives. As part of those efforts, 
we may identify additional data elements that would be helpful. In 
addition, as part of our mission, we regulate the practices and 
behaviors of those individuals who represent claimants before us as 
appointed representatives. We currently have a process in place to 
address allegations when representatives violate our rules of conduct 
and standards of responsibility. We believe those procedures are 
sufficient for our purposes. 

Managing appointed representatives is only a small piece of our 
overall program mission. We rely extensively on our information 
technology (IT) to achieve our goals and keep pace with our rising 
workloads. We direct our IT resources to projects that best allow us 
to accomplish our mission while continuing to deliver high quality 
service to the public. We are concerned that expanding data collection 
to the detailed level of data GAO highlights in Table 4 could 
potentially negatively affect these priorities. The report results did 
not provide enough evidence to support that level of data collection. 
However, as previously noted, to the extent that it helps, we will 
consider other data elements related to appointed representatives to 
generate additional reports. We will make a policy change if we 
determine one is necessary. 

We suggest adding the word "appointed" before "representatives," to 
distinguish between appointed representatives and representative 
payees. 

Recommendation 2: 

Take steps to enhance coordination with States, counties, and other 
third parties with the goal of improving oversight and preventing and 
identifying potential fee violations. This coordination could be 
conducted in a cost-effective manner, such as issuing guidance to 
States and other third parties on vulnerabilities for overpayment; 
sharing best practices on how to prevent overpayments; or considering 
the costs and benefits, including any privacy and security concerns, 
of providing third parties controlled access to portions of the 
electronic folder to facilitate the detection of potential 
overpayments. 

Comment: 

We partially agree. The report did not provide sufficient evidence to 
conclude that we need to enhance coordination with States, counties, 
and other third parties. When we learn of a potential fee violation, 
we take any necessary action to recoup the fees and refer the matter 
to our General Counsel for potential sanctions. As we continue to 
develop enhancements to our appointed representative processes, we 
will consider your suggestions. 

[End of section] 

Appendix IV: GAO Contact and Staff Acknowledgments: 

GAO Contact: 

Daniel Bertoni, Director, (202) 512-7215 or bertonid@gao.gov. 

Staff Acknowledgments: 

In addition to the contact named above, Erin Godtland (Assistant 
Director), Rachael Chamberlin (Analyst-in-Charge), Julie DeVault, 
Alison Grantham, and Michelle Loutoo Wilson made key contributions to 
this report. Additional contributors include: James Ashley, James 
Bennett, David Chrisinger, Rachel Frisk, Alexander Galuten, Monika 
Gomez, Kimberly McGatlin, Daniel Meyer, Matthew Saradjian, Monica 
Savoy, Almeta Spencer, Nyree Ryder Tee, Shana Wallace, Margaret Weber, 
and Candice Wright. 

[End of section] 

Footnotes: 

[1] Federal disability programs have been on GAO's high risk list for 
over a decade because of the need to modernize eligibility criteria 
and ensure better coordination among programs, particularly in light 
of ongoing challenges, including growing demand for benefits. See GAO, 
High Risk Series: An Update, [hyperlink, 
http://www.gao.gov/products/GAO-13-283] (Washington, D.C.: Feb. 14, 
2013). In addition, fraud allegations have raised questions about the 
integrity of SSA's disability programs. See, for example, SSA Office 
of the Inspector General, 2014 Spring Semiannual Report to Congress 
(Baltimore, Md.: May 30, 2014). 

[2] SSA Office of the Inspector General, Claimant Representatives at 
the Disability Determination Services Level, A-01-13-13097 (Baltimore, 
MD: Feb. 27, 2014). To determine the reliability of the findings in 
this report regarding the proportion of nonattorney representatives 
that may be contracting with government entities and other third 
parties, GAO reviewed the documents that the OIG used to place 83 
randomly sampled initial claim files with nonattorney representatives 
into categories by type of representative. Through this process and 
interviews with the OIG regarding their sampling, GAO determined these 
categorizations to be sufficiently reliable for the purpose of this 
report. In addition, GAO performed original analyses on these 83 
randomly sampled initial claim files to determine other 
characteristics of nonattorney representatives, including their fee 
arrangements. See appendix I for additional details. 

[3] We interviewed officials in the SSA regional offices, field 
offices, and state DDSs that corresponded to our three selected sites. 

[4] GAO, Standards for Internal Control in the Federal Government, 
[hyperlink, http://www.gao.gov/products/GAO/AIMD-00-21.3.1] 
(Washington, D.C.: November 1999). 

[5] 42 U.S.C. §§ 423(d), 1382c(a). For a child, SSI eligibility 
criteria require that (1) he/she has a physical or mental impairment 
that results in marked and severe functional limitations, and (2) the 
impairment lasts, or is expected to last, for at least 12 months, or 
is expected to result in death. 42 U.S.C. § 1382c(a)(3)(C)(i). 

[6] In 2014, SSA reported that certain indicators suggest the number 
of SSI recipients may stabilize for the next two decades. 

[7] Claimants must file any further action in federal court. 

[8] For the purposes of this report, we are using the term 
"representative" to refer to appointed representatives. Appointed 
representatives are different from representative payees, which are 
individuals or qualified organizations that help Social Security 
beneficiaries who need assistance managing their benefits. 

[9] Form SSA-1696-U4. 

[10] Specifically, the form indicates whether the representative 
intends to request authorization to receive a fee for services 
rendered and how the representative will seek to receive an authorized 
fee. Representatives can also opt to waive their fees. 

[11] Pub. L. No. 108-203, §§ 302-303, 118 Stat. 493, 519. 

[12] Prior to the Social Security Protection Act of 2004, only 
attorneys had access to direct payment, and only for DI claims. With 
the enactment of that law, the option of direct payment was 
temporarily extended to attorneys in SSI claims, and a demonstration 
project was required which temporarily extended the direct payment 
option to certain eligible nonattorneys in both DI and SSI claims. The 
extension of direct payment to attorneys in SSI claims, and the option 
of direct payment to nonattorneys, were made permanent in 2010 with 
the enactment of the Social Security Disability Applicants' Access to 
Professional Representation Act of 2010. Pub. L. No. 111-142, §§ 2-3, 
124 Stat. 38. 

[13] GAO reported on states' SSI/DI advocacy efforts in 1995. GAO, 
Social Security: Federal Disability Programs Face Major Issues, 
[hyperlink, http://www.gao.gov/products/GAO/T-HEHS-95-97] (Washington, 
D.C.: Mar. 2, 1995). 

[14] Steve Wamhoff, and Michael Wiseman, The TANF/SSI Connection, 
Social Security Bulletin, Vol. 66, No. 4, 2005/2006. 

[15] GAO, Temporary Assistance for Needy Families: Implications of 
Recent Legislative and Economic Changes for State Programs and Work 
Participation Rates, [hyperlink, 
http://www.gao.gov/products/GAO-10-525] (Washington, D.C.: May 28, 
2010). 

[16] Liz Schott, and Clare Cho, Center for Budget and Policy 
Priorities, General Assistance Programs: Safety Net Weakening Despite 
Increased Need (Washington, D.C.: Dec. 19, 2011). According to this 
report, during 2011, seven states eliminated or reduced their General 
Assistance programs. 

[17] For example, the SSI/SSDI Outreach, Access, and Recovery (SOAR) 
project, funded in part by the Substance Abuse and Mental Health 
Services Administration within HHS, is designed to increase access to 
disability benefits by providing SSI/DI advocacy services for eligible 
adults who are homeless or at risk of homelessness and have a mental 
illness and/or a co-occurring substance use disorder. 

[18] SSA considers basic needs to be essential items for everyday 
living that cannot wait until an SSI eligibility determination. These 
include: food, clothing, shelter, personal hygiene items, grooming 
items, transportation to obtain basic needs, and emergency medical 
needs that are not reimbursable under another federal program. 
Generally, a state can be reimbursed for the full amount of interim 
assistance paid, up to the total in cash benefits owed to the SSI 
beneficiary during the interim period. 

[19] See 42 U.S.C. § 1383(g). Interim Assistance Reimbursement does 
not apply to DI benefits. 

[10] Some states operate solely state-funded programs and assistance 
provided through these programs may be eligible for reimbursement 
through the IAR program. 

[21] Under IAR agreements, SSA first reimburses the state and then 
pays any representative's fee. SSA pays any remaining funds to the SSI 
recipient. 

[22] The study found that, in fiscal year 2007, in the 26 states 
studied, just 10 percent of TANF recipients had an open SSI 
application, and 6 percent of adults applying for SSI received TANF 
benefits within a year of their application. Mary Farrell and Johanna 
Walter (2013), The Intersection of Welfare and Disability: Early 
Findings from the TANF/SSI Disability Transition Project, OPRE Report 
2013-06 (Washington, D.C.: Office of Planning, Research and 
Evaluation, Administration for Children and Families, U.S. Department 
of Health and Human Services). Other research has looked at state 
SSI/DI advocacy practices, but only in certain states or sites, rather 
than a national picture. See, for example, Kalman Rupp and David C. 
Stapleton, eds. 1998, Growth in Disability Benefits: Explanations and 
Policy Implications (Kalamazoo, MI: W.E. Upjohn Institute for 
Employment Research). 

[23] We identified these states through extensive interviews and field 
work, involving stakeholders from all aspects of this process--
including interviews with companies that provide SSI/DI advocacy 
services; state, county, and local agencies; professional 
organizations for representatives and state TANF and DDS 
administrators; and researchers--as well as through Internet research. 
We also confirmed the information collected with state or county 
officials, as appropriate. See appendix I for additional details on 
our scope and methodology. 

[24] Massachusetts and Pennsylvania also reported having similar 
models at the state level, which provided funds to a legal aid 
organization that provides grants to other legal aid groups for SSI/DI 
advocacy services. 

[25] According to WeCARE officials, one of the nonprofit organizations 
contracted by New York City for the WeCARE program subcontracted with 
a for-profit company for the SSI/DI advocacy portion of the contract. 

[26] SSA Office of the Inspector General, Claimant Representatives at 
the Disability Determination Services Level, A-01-13-13097 (Baltimore, 
Md.: Feb. 27, 2014). The OIG selected a random sample of 275 SSI/DI 
adjudicated claims from the population of 857,855 adjudicated claims 
with a representative in calendar year 2010, 201 of which were for 
initial claim determinations. Of these 201 claims, 83 were represented 
by nonattorney representatives, while the remainder had attorney 
representatives. The OIG reviewed the contents of each sampled 
nonattorney claim file to determine the type of representative, since 
this information is not available in SSA's systems. GAO then reviewed 
selected documents from the OIG's generalizable sample of claim files 
with determinations in 2010 to calculate our estimate. Additional 
details regarding GAO's analysis of these data and work papers can be 
found in appendix I. 

[27] The 95-percent confidence interval for this estimate ranges from 
1 to 12 percent. 

[28] In addition to nonattorney representatives, there are also some 
attorneys who provide representation services under contract with a 
government entity or other third party, which are not included in the 
estimate above. However, it is not possible to estimate the proportion 
of claims filed by attorneys under these contracts given the data 
available. The OIG did not review the contents of the electronic 
claims folders for claims with attorney representatives to determine 
whether these representatives were working under contract to 
government entities or other third parties, such as hospitals and 
insurance companies. 

[29] The 95-percent confidence interval for this estimate ranges from 
20 to 40 percent. 

[30] We compared the maximum SSI benefit, including state 
supplementation, for an individual living independently in each state, 
as of January 2014; the maximum TANF benefit for a single-parent 
family of three, as of July 2013; and the maximum General Assistance 
benefit for an individual, as of September 2014. Data on SSI benefits 
were obtained from SSA. For Hawaii and Minnesota, we used the state 
TANF benefits reported by states in the Welfare Rules Database funded 
by HHS, and the state General Assistance benefits reported in state 
documents. In Westchester County, we used the TANF and General 
Assistance benefits reported by county officials. Westchester County's 
maximum TANF benefit, which has been in effect since October 2012, was 
$7 higher than the state SSI benefit, but the General Assistance 
benefit was lower than the state SSI benefit. 

[31] According to state and SSA documents, Minnesota's General 
Assistance program provides a maximum of $203 per month for a single 
adult, compared to a maximum of $802 a month for an individual on SSI. 

[32] In commenting on a draft of this report, HHS officials noted that 
the majority (more than 80 percent) of TANF families receive 
Supplemental Nutrition Assistance Program benefits and almost all TANF 
families (more than 95 percent) receive health coverage through 
Medicaid or the Children's Health Insurance Program. 

[33] There are 55 contractors in Minnesota. For the purposes of 
describing the services that the contracted organizations provided, we 
selected the largest for-profit and non-law nonprofit contractor, in 
terms of the number of approved Social Security disability claims in 
2013. Accordingly, we reviewed the contracts for the two contractors 
we selected. As noted previously, state officials told us that because 
they use a form contract, the two contracts we reviewed were similar 
to all 55 contracts.The other two sites had single contractors. 
Therefore, we selected a total of four contracted organizations in the 
three sites (two in Minnesota and one each in Hawaii and Westchester 
County, New York). 

[34] We calculated these rates based on the number of referrals the 
contractors reported receiving in a given year and the number of 
claims they filed in that same year. Some of the claims filed may be 
associated with referrals in the prior year, among other limitations. 

[35] We attempted to collect data from each site on the number of 
referrals, SSI and DI applications filed, and percent of approved 
applications. However, we did not receive sufficiently complete or 
consistent data from all sites. Therefore, we cannot report exact 
referral or approval rates for these sites and contractors. 
Furthermore, SSA does not collect data that would allow us to compare 
approval rates across the various sites and contractors. 

[36] In each of the three sites, staff from the contracted 
organization become a claimant's appointed representative by 
submitting SSA form 1696, which is signed by the claimant and the 
representative. Officials from the contracted organizations in these 
three sites told us that the staff who assist claimants are generally 
nonattorney representatives. 

[37] The DI application is available online, but the SSI application 
is not. In order to file for SSI, a claimant must complete the 
application during an in-person or telephone appointment with an SSA 
field office claims representative. 

[38] Continuing disability reviews (CDRs) are generally required to 
determine whether recipients continue to meet the disability 
requirements of the Social Security Act. 

[39] There are two statutory methods by which a representative can 
seek authorization for a fee for his or her services before SSA. 
Currently, under the fee agreement process (42 U.S.C. § 406(a)(2)), 
the fee is capped at 25 percent of a claimant's past-due benefits or 
$6,000, whichever is less. Under the fee petition process (42 U.S.C. § 
406(a)(1)), a fee may be authorized even if no benefits are payable to 
the claimant, but it must be "reasonable." There is no maximum fee 
under the fee petition process. In situations where past-due benefits 
are awarded, the amount that SSA withholds for direct payment is 
limited to 25 percent of those past-due benefits. 

[40] Minnesota Department of Human Services officials noted that 35 
percent of the funds received through Interim Assistance Reimbursement 
are used for contracts, outreach, and staffing the program at the 
state level, and that the remainder goes into the state's general 
fund. They stated that all unused money can be rolled over to the next 
year. Hawaii Department of Human Services officials also noted that 
they are only able to retain a portion of IAR funds for their General 
Assistance program because retroactive payments received for a prior 
fiscal year must be returned to the state's general fund. They further 
noted that funds to pay for SSI/DI advocacy are appropriated by the 
state's legislature. 

[41] SSA, Annual Statistical Supplement to the Social Security 
Bulletin, 2013 SSA Publication No. 13-11700 (Washington, D.C.: 
February 2014). The SSI data exclude claims for aged individuals 
(those who qualify for the program because they are 65 or older and 
have limited income and resources, and meet other eligibility 
requirements). There may be overlap in the SSI and DI data, in cases 
where individuals are receiving both SSI and DI. SSA keeps data on SSI 
and DI awards separately and does not have readily available data from 
which to identify and account for concurrent awards. 

[42] According to SSA's Annual Statistical Supplement, 2013, there 
were about 4,000 SSI and DI awards, or approvals, in Hawaii in 
calendar year 2012. The statistical supplement does not provide data 
at a county level, but SSA provided data showing there were 
approximately 3,800 SSI and DI awards in Westchester County, New York, 
in calendar year 2012. 

[43] For the purposes of this report, "rules" refers to SSA's Program 
Operations Manual System, a primary source of information used by SSA 
employees to process claims for Social Security benefits. 

[44] 20 C.F.R. §§ 404.1740, 416.1540. SSA officials noted that, under 
its regulations, a representative is an individual who meets specific 
regulatory requirements and who is appointed by a person claiming a 
statutory right or benefit under one of SSA's programs. As such, SSA's 
rules of conduct and standards of responsibility are directed toward 
individual representatives rather than organizations or law firms 
providing SSI/DI advocacy services to claimants on behalf of states 
and other third parties. 

[45] 20 C.F.R. §§ 404.1705, 416.1505. Generally, representatives also 
must have any fee amount authorized by SSA before collecting the 
authorized fee directly from the claimant. 

[46] Revisions to Rules on Representation of Parties, 73 Fed. Reg. 
51,963 (to be codified at 20 C.F.R. parts 404, 408, 416, and 422) 
(Sept. 8, 2008). 

[47] SSA did, however, issue final rules in 2011 to provide additional 
controls and address some misconduct by representatives. According to 
SSA, these rules provide some additional controls to address 
misconduct within organizations. Revisions to Rules of Conduct and 
Standards of Responsibility for Representatives, 76 Fed. Reg. 80,241 
(Dec. 23, 2011). The 2011 rules included prohibiting a representative 
from suggesting, assisting, or directing another person to violate the 
agency's rules or regulations and prohibiting a representative from 
knowingly assisting a person whom the agency suspended or disqualified 
from providing representational services. 

[48] A recent SSA OIG special report raised similar concerns, stating 
that SSA does not have the infrastructure or a system to properly 
track the activity of representatives, physicians, or medical 
providers. The report concluded that SSA should develop a system to 
identify and review trends in claims with common characteristics, such 
as claims with the same representatives and medical providers. SSA 
Office of the Inspector General, The Social Security Administration's 
Ability to Prevent and Detect Fraud (September 2014). 

[49] [hyperlink, http://www.gao.gov/products/GAO/AIMD-00-21.3.1]. 

[50] Online access to eFolders is now available for appointed 
representatives with cases pending at the hearings and Appeals Council 
levels. 

[51] If the representative elects to receive direct payment, SSA 
reduces the claimant's past-due benefits by the amount of the 
authorized fee. Payments that states or third parties make to 
representatives do not reduce the claimants' past-due benefits. 

[52] In some situations, SSA does not need to authorize a fee. One 
such situation is when certain third parties (such as a state) pay the 
representative's fees; the claimant and any beneficiaries are not 
liable to pay a fee or any expenses, or any part thereof, directly or 
indirectly, to the representative or someone else; and the 
representative waives the right to charge a fee from the claimant. 20 
C.F.R. §§ 404.1720(e), 416.1520(e). SSA's Program Operations Manual 
System further states that representatives must not knowingly 
circumvent SSA rules, which require that when a third party pays a 
representative's fee, the claimant and any auxiliary beneficiaries 
must be free of liability directly or indirectly or the representative 
is engaging in prohibited conduct. 

[53] If both payments are for services performed before SSA, these 
actions would be a violation of SSA's rules of conduct and standards 
of responsibilities. SSA refers to this as a "fee violation." For the 
purposes of this report, we are using the term "overpayment." 

[54] GAO, SSA Disability Representatives: Fee Payment Changes Show 
Promise, but Eligibility Criteria and Representative Overpayments 
Require Further Monitoring, [hyperlink, 
http://www.gao.gov/products/GAO-08-5] (Washington, D.C.: Oct. 15, 
2007). GAO recommended that SSA assess the extent to which 
representatives collect more than their authorized fee through a 
combination of state payments and fee withholding and, if necessary, 
identify and implement cost-effective solutions to ensure that 
representatives either are not paid more than their authorized fee or 
return any payments they receive in excess of their authorized fee. 

[55] Representatives can also choose not to be paid for their services 
and, therefore, waive payment from any source. 

[56] SSA officials noted that they have not identified a program need 
for SSA to coordinate with states and other third parties on 
representative payments. 

[57] In commenting on a draft of this report, SSA noted that this 
issue needs to be evaluated further before access to any third party 
is allowed. 

[58] The 95-percent confidence interval for this estimate ranges from 
20 to 40 percent. 

[59] SSA Office of the Inspector General, Claimant Representatives at 
the Disability Determination Services Level, A-01-13-13097 (Baltimore, 
Md.: Feb. 27, 2014). 

[60] GAO, SSA Disability Representatives: Fee Payment Changes Show 
Promise, but Eligibility Criteria and Representative Overpayments 
Require Further Monitoring, [hyperlink, 
http://www.gao.gov/products/GAO-08-5] (Washington, D.C.: Oct. 15, 
2007). Specifically, at least 10 states reported that they used a 
portion of the Interim Assistance Reimbursement funds they received 
from SSA to pay representatives. 

[61] In January 2014, Hawaii issued a new request for proposals for 
SSI/DI advocacy that combined two prior contracts for SSI/DI advocacy 
and medical and psychological evaluations. As of July 1, 2014, the 
effective date of the new contract, the SSI/DI advocacy services are 
subcontracted to a legal aid organization by a for-profit company that 
is contracted to provide medical and psychological evaluations for the 
state's cash assistance programs. Previously, the SSI/DI advocacy 
contract was a separate, stand-alone contract. 

[62] In Minnesota, which has contracts with 55 organizations, we 
selected the largest for-profit and largest non-law, nonprofit 
organization, in terms of the number of approved Social Security 
disability claims in 2013. The other two sites had single contractors. 

[63] In each site, based on discussions with state or county officials 
and officials from the organization working under the contract, we 
selected the field office(s) that were closest in proximity or 
interacted most frequently with the contractor. In Hawaii, we 
interviewed managers and staff in the Honolulu field office; in 
Minnesota, we interviewed managers and staff in the St. Paul and 
Minneapolis field offices; and in Westchester County, New York, we 
interviewed managers and staff in the White Plains and Yonkers field 
offices. 

[64] In Hawaii and Minnesota, we met with administrators and claims 
examiners in each state's DDS. In New York, we met with administrators 
and claims examiners at the Albany office, as this is the state DDS 
office in which most of the claims from Westchester County are 
processed, according to DDS officials. 

[65] Although we wanted to randomly select staff, we also wanted to 
interview staff in SSA field offices and DDSs who would likely have 
experience with SSI and DI claims and the representatives we were 
studying, including enough experience to describe recent trends in 
representation and any other relevant patterns or observations. 
Specifically, in the Hawaii, Minnesota, and Albany, New York, DDS 
offices and the Honolulu, Minneapolis, and White Plains SSA field 
offices, we asked SSA or DDS officials, as appropriate, for a list of 
staff who met the following qualifications: (1) staff who had been in 
the position for at least 2 years, (2) staff with experience 
processing disability claims at the initial level, rather than 
retirement claims or continuing disability reviews, and (3) eliminate 
from the list any staff who focus mainly on out-of-state cases and 
compassionate allowances (according to SSA, these are claims that SSA 
can process quickly because they are for diseases and other medical 
conditions that invariably qualify under SSA's Listing of Impairments 
based on minimal objective medical information). We assigned a random 
number to each person and put the lists in order by that random 
number, and we requested interviews with the first four staff members 
on each list. If an individual on the list was not available to meet 
with us, we selected the next staff person on the list until we 
reached our goal of interviewing four staff persons at each site. 

[End of section] 

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