Statement of James Hill, President, Chapter 224, National Treasury Employees Union, Cleveland,
Ohio Testimony Before the Subcommittee on Social Security of the House Committee on Ways and Means June 15, 2006 Good
morning Chairman McCrery, Ranking Member Levin and members of the Subcommittee
on Social Security. My name is James Hill. I have worked as an
Attorney-Adviser in the Office of Disability Adjudication and Review (formerly
the Office of Hearings and Appeals) for over 23 years. I am also the President
of Chapter 224 of the National Treasury Employees Union (NTEU) that represents
Attorney-Advisers and other staff members in approximately 110 Office of Disability
Adjudication and Review (ODAR) Hearing and Regional Offices across the United
States. I thank the Subcommittee for inviting me to testify regarding
Commissioner Barnhart’s proposal now known as the Disability Service
Improvement Initiative (DSI) to reform the disability determination process.
My testimony today represents the views of NTEU.
Since
the early 1990’s SSA hearing offices have been under severe stress caused by an
adjudication process woefully inadequate to process the massive numbers of appeals
of State Agency determinations. Cases pending at OHA hearing offices rose from
approximately 180,000 in 1991 to approximately 550,000 cases nationwide by
mid-1995. At that time SSA began the Senior Attorney Program which during its
pendency from 1995 to early 2000 produced over 220,000 fully favorable
on-the-record decisions. The number of cases pending at hearing offices was
reduced to approximately 311,000 in September 1999. However, since 1999, a
number of factors including the termination of the Senior Attorney Program,
increased receipts, and the implementation of the disastrous Hearings Process
Improvement Plan (HPI) have resulted in a record number of cases pending.
Currently, there are approximately 727,000 cases pending at ODAR hearing
offices with an average processing time of nearly 480 days. In some hearing
offices processing time is approaching two years. All agree that this is
not an acceptable level of service.
The
current backlog was accumulated over the course of several years. Elimination
of the backlog will take several years; there are no practical “quick fixes”.
Commissioner Barnhart recognized this fact and after a comprehensive and
lengthy review of the current adjudication process, she proposed a number of
fundamental changes. The changes in the disability process were codified in
the final regulations published on March 31, 2006. The process by which these regulations were promulgated was lengthy and involved substantial
interaction with entities internal and external to SSA that are interested in
the disability process.
The final
regulations significantly alter the disability adjudication process. They
create a “quick decision process” to adjudicate those claimants who are
obviously disabled. They eliminate the reconsideration determination and
create an entirely new level of decision maker; the Federal Reviewing
Official. The final regulations replace the Appeals Council with a Decision
Review Board and indicate that an entirely new quality assurance system will be
created that will function at each level of the process. The final regulations
introduce a limited number of changes in the Administrative Law Judge hearing
process but do not alter the essential nature of that process.
To
facilitate the new disability adjudication process, Commissioner Barnhart has
instituted organizational changes designed to facilitate the implementation of
DSI. These changes include the creation of Quick Decision Units at the state
agencies, the creation of the Office of Disability Adjudication and Review, and
the creation of Medical and Vocational Expert Units. The components of the Office
of Disability Adjudication and Review include the Office of the Chief
Administrative Law Judge that oversees the operations of the Agency’s hearing
offices, the Office of the Chief Federal Reviewing Official that oversees the operations
involving the Federal Reviewing Officials (FedRO), the Office of Appellate
Operations (the Appeals Council) and the Office of the Decision Review Board.
Implementation
of DSI will commence in the Boston Region on August 1, 2006. The Commissioner has wisely selected the Boston Region as the first to implement DSI for a
number of reasons including its small size (currently the Boston Region has
about 3% of the hearing office caseload) and state agencies that are
efficiently processing their workloads. Notably, the Boston Region hearing
offices are not troubled by the huge backlogs that afflict so many hearing
offices across the United States. The Commissioner also has decided that DSI
will not be expanded to other regions for at least a year. This permits the
fine tuning that will certainly be necessary in order to achieve maximum
efficiency. Only after DSI has proven its viability will it be expanded and
even then, to other small regions initially.
Quick
Decisions
In
order to provide timely benefits to those who are “obviously disabled”, the new
regulations contain provisions for a “Quick Decision Process”. This will
significantly improve the disability adjudication process for those claimants
with specified medical conditions that normally result in a finding of
disability. The Commissioner projects that approximately 10% of initial
claims can be handled through this process. While originally scheduled to
be attached to various regional offices, the final regulation places these
units in the various state agencies. This is an example of the flexibility
shown by the Commissioner during the course of the comment period.
The
Role of the Federal Reviewing Official (FedRO)
Perhaps
the most innovative initiative contained in the regulations is the elimination
of the reconsideration determination and the creation of the Federal Reviewing
Official (FedRO) position, a federal attorney with complete adjudicatory
authority that is placed between the State Agency and the Administrative Law
Judge. It is absolutely essential that the FedRO process be more than a
replacement for the current reconsideration determination which has very little
credibility with the public or with ALJs.
If DSI
is to fully succeed, the FedRO must introduce an element of credibility in
disability adjudications prior to the ALJ hearing that is presently
lacking. Currently, the State Agencies provide almost no rationale for
their unfavorable determinations which seriously undermines their
credibility. It is essential that the decisions made by the FedRO be
recognized as independent decisions by an individual who has the discretion to
award or deny benefits as justified by the record. The importance of
attaining this credibility cannot be overstated. The final regulations
removed some, but not all, of the ambiguity in the proposed regulations that
led many to question whether the FedRO is an independent decision maker. If
the FedRO turns out to be “just a federal reconsideration determination” DSI
will fail.
To enhance
the credibility of the FedRO decision, it must be a well reasoned,
comprehensive and literate explanation of why a claimant is, or is not,
entitled to disability benefits. To be effective the FedRO process must
establish its credibility with claimants, the State Agencies, Administrative
Law Judges and most importantly with the American public. This requires
the legal expertise of an attorney to apply the rules, regulations and law to
the evidence and to make and issue a legally defensible written decision.
It also demands extensive knowledge and experience in evaluating the functional
effects of medical impairments. The FedRO must have extensive legal and
disability program knowledge and experience. Fortunately, SSA already
employs personnel with the education, training, and experience to decide and
draft disability decisions necessary to assure the success of the FedRO process
-- ODAR Attorney Advisers.
The
expertise of each individual FedRO is vital to the success of DSI. It is
essential that the Agency secure the best available applicants. The first 70
FedROs will be located in the Washington metropolitan area, close to or at ODAR
headquarters. Given the number of unknown factors associated with the
“start-up” of this new process, it is prudent that it be located centrally.
However, there is a significant downside to such a centralized location in that
many of the best qualified potential applicants will not compete for the
positions simply because of the location and the general unattractiveness of
the proposed working conditions. It is essential for the success of DSI that
the key position in DSI, the FedRO, is accessable to those most qualified to
successfully perform the requirement of the position. That entails locations
convenient to those highly qualified individuals as well as working conditions
conducive to enticing the best to apply and accept the appointment. Hopefully,
SSA will recognize that acquiring the best possible applicants requires that
the position must be made attractive, and in the future, it will adjust its
hiring strategies to facilitate acquiring the best possible personnel.
There
is a larger issue involved in the eventual placement of FedRO personnel. When
citizens think about the Social Security Administration, they do not perceive
it as a far off governmental bureaucracy located in Baltimore. Most do not
even know that SSA headquarters is in Baltimore. When most citizens think of
SSA, they do so in terms of their local SSA office where they can deal face to
face with SSA employees who are their neighbors. This is an invaluable asset
not only to SSA but to the public we serve. Is it likely that SSA would have
delivered such spectacular service to the people of hurricane damaged Louisiana,
Mississippi, Alabama, and Texas if it had been a faceless bureaucracy located
somewhere inside the “Beltway”? SSA is what it is in part because it is
neighbors serving their neighbors. The rationale that applies to the wisdom of
maintaining local field and hearing offices should also apply to the FedRO. Citizens
are much more comfortable dealing with their government on a local basis with
people who are their neighbors, not strangers half a country away.
An
important objective of DSI is to facilitate consistency at all decisional
levels. The inconsistency of decision-making between the state agencies themselves,
state agencies and ALJs, and even among ALJs themselves has been a constant
source of criticism. However, it must be understood and accepted, that
the complexity of disability determinations and the difference in the effects
of medical conditions on each individual leads to some perceived inconsistency
in the decisional results. Nonetheless, the final regulations do facilitate
decisional consistency without interfering with the decisional independence of
adjudicators at all three levels through several modalities including the FedRO
process itself and a comprehensive quality assurance program.
The
requirement that the FedRO produce a well reasoned legally defensible decision
using the same rulings, regulations, court decisions, and statutes as are used
by the ALJ should greatly enhance decisional consistency. DSI initiates feedback
loops among the various levels of adjudication that will provide each level
with insight into the thought processes of the other decision makers. If the FedRO
decision is different from that of the State Agency, the FedRO’s written
decision will explain to the State Agency why a different decision was
reached. This level of communication, both formal and informal, between
the FedRO and State Agency will result in improved decision making by both
entities and promote decisional consistency without adversely affecting the
claimants.
The
increased level of decisional consistency promoted by the regulations will
result in the reality and the perception that the proper decision is being made
at the earliest possible time. The FedRO decision will present the ALJ
and the claimant with a comprehensive explanation of why the Agency denied the
claim. While it imposes no limitation on the ALJ, it does help focus the
issues in controversy leading to a more efficient hearing process. By
providing the claimant with a detailed explanation of why his/her application
was denied, the FedRO assists the claimant and his/her representative in
marshalling evidence needed to establish disability.
The
ALJ Hearing
The final
regulations wisely retain the Administrative Law Judge hearing process
essentially unchanged. Hearing offices will continue to prepare cases for
hearing, Administrative Law Judges will continue to conduct due process
hearings, and the decisional independence of the ALJ continues to be protected
by the APA. However, concern had been expressed about the relationship
between the FedRO and the ALJ. The final regulations make it clear that
the FedRO decision is not entitled to any deference on the part of the
ALJ. The Commissioner’s Plan recognizes that the reality of the de
novo hearing must be maintained and the freedom of the ALJ to decide cases
based upon his/her evaluation of the evidence and the appropriate law and
regulations must be preserved.
Elimination
of the Appeals Council
Another
bold initiative of DSI is the elimination of the Appeals Council and the
claimant’s right to make an administrative appeal of the ALJ decision.
While on its surface the elimination of the Appeals Council appears to be
detrimental to claimants, that is not the case. The effect of the
elimination of the Appeals Council must not be viewed in isolation, but in the
context of the entire adjudicatory process. Improvements in the decision
making process at the State Agency level, the introduction of the RO, and the
quality assurance program proposed by the Commissioner render the
administrative review of ALJ decisions unnecessary. We believe that
considering the Commissioner’s New Approach in its totality, an additional
administrative appeal of the ALJ decision is unnecessary.
As
currently constituted the Appeals Council serves two distinct purposes.
It serves as an appellate body and as a quality assurance entity, but performs
neither with distinction. This is not intended to disparage the
hard-working employees at the Appeals Council, but rather its basic concept and
design. The final regulations replace the Appeals Council with an
end-of-line review by a centralized quality control unit known as the Decision
Review Board. The Agency, in its effort to improve quality assurance at the
ALJ level of adjudication, should take care not to repeat its mistakes of the
early 1980s when it attempted to interfere with ALJ decisional
independence. The final regulations recognize that in order to avoid the
appearance of interference with ALJ decisional independence, it is essential
that ALJs be intimately involved in any quality assurance program.
There
is concern that the lack of a right of administrative appeal of the decisions
of Administrative Law Judges will result in a substantial increase in the
caseload of the District Courts. We agree that any action that
significantly increases the caseload of the district courts is
unacceptable. However, we believe that the assumption that eliminating
the Appeals Council will significantly increase District Court caseload is
unwarranted. While such an assumption is sustainable if one considers the
elimination of the Appeals Council in isolation, it is far less sustainable
when one considers the whole breadth of the Commissioner’s plan. In that
light, we expect that after a period of adjustment, the increased quality of
the adjudication system will actually decrease the number of cases filed at the
District Court. It will certainly significantly decrease the number of
voluntary remands. In any event, the measured implementation process that
limits DSI to the Boston Region for at least one year will permit an
opportunity to observe the impact of the elimination of the Appeals Council on
the number of court filings.
While
appealing unfavorable ALJ decisions directly to the District Court is
appropriate, claimants should not have to file an action in the District Court
to contest a dismissal of a Request for Hearing. The final regulations permit
claimants to appeal dismissals to the Disability Review Board.
AeDIB
The
Commissioner has made it clear that inauguration of her new approach is
predicated upon the successful implementation of AeDIB. SSA has had
sufficient experience with implementing substantial process changes without
ensuring the necessary system improvements are in place to know the dangers of
premature implementation. Fortunately, AeDIB is progressing as well as
can be expected. Components of AeDIB such as digital recording of
hearings, video teleconferencing for conducting hearings, and a new case
management system (CPMS) have been successfully accomplished. Decision writing
templates that significantly improve the quality of written ALJ decisions have
been enthusiastically received and continue to be made even more user
friendly. The Agency has determined that dual monitors are necessary to
maximize the utility of the electronic folder and in fact has commenced the
purchase and distribution of a second monitor to those employees who duties
require the use of two monitors. Of course the most important and most complex
component of AeDIB is the electronic folder itself.
The
savings, both in time and money, that will be realized by converting from paper
folders to electronic folders are substantial and will result in improved
service to the public. The electronic folder will significantly increase the
Agency’s flexibility in managing its workload and permit cases to be processed
more expeditiously. Implementing electronic folders is a massive
undertaking and the consequences of failure are catastrophic. However, the
realistic attitude and the competency of Agency personnel charged with the
responsibility of implementing the electronic folder has resulted in a process
that is proceeding as well as can be expected. They have demonstrated a
capacity to listen to the comments from end users and introduce improvements on
a nearly continual basis. There is every reason to expect the electronic
folder to be a technical success. However, the Agency should recognize that
the fundamental differences in the interface between employees and the
electronic folder and the current interface between employees and paper folders
may render some tasks more time consuming than is presently the case.
The
Backlog at Hearing Offices
The
disability backlog problem at ODAR is neither recent nor entirely intractable,
but it is persistent.
As of the end
of April 2006 there were 727,629 cases pending at ODAR hearing offices. The
optimal level of cases for efficient ODAR HO operations is 350,000 cases.
While DSI will significantly improve the adjudication process, it will have
little impact on the current backlog. In fact, if the backlog problem is not
addressed it will strangle the Commissioner’s DSI initiative. Unless the
backlog at ODAR hearing offices is eliminated, DSI will be no more effective in
providing timely service they we are now. Fortunately, history provides the
vehicle for the resolution of the backlog problem – the Senior Attorney Program
begun in 1995. The solution is to use current staff to perform the
adjudication needed to deal with this problem.
It is not a coincidence that
during the time the Senior Attorney Program was in operation (1995-2000) the
number of cases pending at OHA hearing offices declined, nor is it a
coincidence that the number of cases pending increased after the Senior
Attorney Program was terminated as part of the Hearings Process Improvement
Plan (HPI). Over its five year history, the Senior Attorney Program produced
220,000 decisions which when combined with record ALJ productivity reduced the
number of cases pending at hearing offices from 550,000 to 311,000 cases. This
was accomplished with a relatively modest expenditure of resources. HPI
eliminated the Senior Attorney Program because it was believed that the Senior
Attorney Program was no longer necessary. The termination of the Senior Attorney
Program, the implementation of the disastrous HPI initiative and increased
receipts have resulted in a record number of cases pending. ODAR has a serious
backlog problem, and there is no reason to expect a significant improvement in
the foreseeable future.
As discouraging as the increase
of cases pending may be, it does not fully reflect the harmful effect of the
backlog on the public. Average processing time at the hearing office level was
approximately 270 days at the beginning of FY 2000; now it is nearly 480 days.
In some locales, claimants have to wait nearly two years for a hearing. This
is an unconscionably long wait for a disability decision, and it is causing
untold harm to some of the most vulnerable members of society. None will dispute
that the public deserves far better service than SSA is presently providing.
The backlog has risen despite
system and process improvements and record ALJ productivity levels. Current
initiatives have not materially affected the backlog because they fail to deal
with the underlying causes of the backlog. The root causes of the hearing
office backlog are the number of receipts, too few adjudicators for the size of
the caseload, and an inefficient adjudicatory process. Little can be done
about the number of receipts. Fiscal considerations preclude acquiring the
massive number of ALJs that would be required to effectively reduce the
backlog. ODAR must look elsewhere for the additional adjudicators temporarily needed
to deal with the backlog problem.
Consistent
with my testimony at previous hearings, we recommend implementing an improved
Senior Attorney Adjudicator Program. If implemented this programwould
produce approximately 370,000 high quality favorable decisions over the next four
fiscal years, effectively eliminating the backlog by the end of FY 2010, with a
minimal increase in resources. Additionally, none of those cases would need to
be worked up (pulled) as Senior Attorney Adjudicators would review and decide
unpulled cases. This will significantly reduce the backlog of cases to be
pulled.
A Senior
Attorney Adjudicator Programwould invest the authority to issue
fully favorable on-the-record (OTR) decisions in all hearing level attorneys
with at least 3 years experience. All qualified ODAR attorneys with at least
three years’ experience would assume decision making as well as ALJ decision
drafting duties. The addition of decision making duties necessarily reduces
decision writing capacity. However, because most ALJ decision writing will
continue to be done by attorneys, replacing lost decision writing capacity can
be accomplished by redirecting current assets. The original Senior Attorney
Program demonstrated the validity of this concept. To further ensure quality,
all Senior Attorney decisions would be drafted in the new decisional templates,
formatted for Senior Attorney signature, and a Lead Senior Attorney position
would be created. This individual would review hearing office (HO) decision
drafts, including those drafted by Senior Attorneys, and provide feedback on
quality to management, the writers and the Senior Attorneys.
The large
number of Senior Attorneys who would perform both the function of decision
maker and decision writer ensures that each hearing office would have maximum
flexibility in managing its workload. Requiring that Senior Attorneys still
draft ALJ decisions ensures that ALJs continue to have access to the most
skilled and experienced decision writers. No DSI cases would be subject to
adjudication by a Senior Attorney.
In addition to making a positive,
immediate, and effective impact on the backlog, a Senior Attorney Adjudicator
Programwould act as a training program for the Federal Reviewing
Official (FedRO) position. Over the next five years, SSA will hire or promote
over 2000 attorneys for the FedRO position that the Commissioner has repeatedly
declared to be the linchpin of DSI. Hiring new attorneys in ODAR hearing
offices will permit them to learn the SSA disability adjudication process under
the mentorship of Senior Attorneys and Administrative Law Judges. Eventually,
those successful as Attorney Advisers would become Senior Attorneys. Those
successful as Senior Attorneys would be prime candidates for the FedRO
position. The selection of FedROs would be based on demonstrated performance
and not the vagaries of a merit selection system.
The conversion of a large number
of ODAR Attorney Advisers to part time decision making Senior Attorneys will
result in an immediate and substantial improvement in ODAR service to the
public at minimal additional cost. Based upon the Agency’s experience with the
original Senior Attorney Program, and with the full cooperation of hearing
office management (lacking during the original Senior Attorney Program), this
initiative could produce as many as 100,000 quality decisions a year without
diminishing ALJ productivity or changing the overall payment rate. Based upon
previous experience, the average processing time for these cases would be
approximately 100 days. Additionally, the minimal staff time and complete lack
of ALJ time spent on these cases frees the staff and ALJs to spend more time on
processing those cases requiring a hearing. The staff will benefit greatly
from the significant reduction in the pulling workload caused by the Senior
Attorney Adjudicator Program. The reduction of the backlog will significantly
enhance the ability of hearing offices to more efficiently transition from
paper to electronic files and will enable hearing offices to effectively
fulfill their role in the DSI process.
The savings in administrative
costs to the Agency and human costs to the claimants by eliminating unnecessary
hearings would be substantial. Adjudicating cases that should have been paid
without the need for ALJ involvement will not only provide much more timely
service to those disabled claimants, but it will free ALJs to hear only those
cases requiring a hearing thereby shortening the time those claimants must wait
for a disability decision. The savings and improved service that would result
from the implementation of a Senior Attorney Adjudicator Program based upon the
original Senior Attorney Program would be substantial. This program would greatly
facilitate the transition from the current system to DSI.
Mr. Chairman, again, I appreciate the opportunity to testify
before this committee and would be happy to answer any questions members of the
committee may have. Thank you.
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