Summary

The Social Security Administration (SSA) is poorly managing a small but growing program to encourage disability beneficiaries to seek employment. The "plan for achieving self-support" (PASS) program, established in 1972, is currently small--only about 10,300 persons participated in December 1994--but the number of participants has swelled more than fivefold during the past five years as awareness of the program has increased, and millions more disabled beneficiaries have become eligible to participate. The PASS program is vulnerable to abuse because of vague guidelines, and its impact on employment is unknown because SSA does not collect basic data on participants and their employment. In addition, SSA top management has not adequately considered the potential problems posed by professional PASS preparers, whose fees--as much as $800--are often included as PASS expenses. SSA is trying to address some of these internal control weaknesses, but it cannot guarantee today that taxpayer dollars are being well spent.

GAO found that: (1) SSA has poorly implemented and managed the PASS program and has not given its field office staff adequate program guidance, support, or training; (2) the diversity of individual plans' goals and expenditures reflects the diversity of the disability population; (3) the PASS program has grown over the past 5 years as program awareness has increased, and further growth is predicted because millions of Supplemental Security Income (SSI) and Disability Insurance (DI) beneficiaries are eligible; (4) about 40 percent of PASS program participants, who are mainly DI beneficiaries, would not be eligible for SSI benefits if some of their income was not excluded under PASS; (5) the impact of the PASS program cannot be accurately determined because SSA does not have basic data on program participation and has not defined clear program goals; (6) former PASS participants are more likely than other SSI beneficiaries to have earnings that reduce their SSI benefits, but few have left the SSI and DI rolls; (7) PASS participation increases SSI benefit outlays by about $30 million annually; (8) the PASS program is vulnerable to abuse because internal controls are weak, guidelines are vague, applications are not uniform, there is no limit on individuals' participation, compliance monitoring is infrequent and nonstandardized, and few penalties exist for willful noncompliance; and (9) SSA has not addressed the potential financial conflicts of interest caused by professional PASS preparers.