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Social Security: New Functional Assessments forChildren Raise Eligibility Questions. Report toCongressional Requestors.General Accounting Office, Washington, D.C.GAO-HEHS-95-66Mar 9534p.

U.S. General Accounting Office, P.O. Box 6015,Gaithersburg, MD 20884-6015 (first copy free,additional copies $2 each; quantity discounts).Reports Evaluative/Feasibility (142)

MF01/PCO2 Plus Postage.Children; Child Welfare; *Clinical Diagnosis;*Disabilities; Disability Identification;*Eligibility; *Federal Aid; Financial Support;Income; Severity (of Disability); *Test Validity;Welfare Recipients; *Welfare Services

IDENTIFIERS Indrvidualized Functional Assessments; *SupplementalSecurity Income Program

ABSTRACTThis report to Congress examines the Social Security

Administration's approach to assessing children's impairments throughthe individualized functional assessment (IFA) process mandated bythe Supreme Court in Sullivan v. Zebley. Specifically, the reportassesses the IFA's impact on number of Supplemental Security Incomerecipients, IFA's implementation, and its vulnerability to coaching.Investigators found fundamental flaws in the IFA process, and citedthe subjective nature of adjudicators' assessments of children'sbehavior as a barrier to consistent and reasonable administration ofthe program, particularly for children with behavioral and learningdisorders. Although rapid program growth is seen as leading to apublic perception that many parents coach their children to fakemental impairments, little evidence of widespread coaching was found.It is noted, however, that substantiating and measuring allegationsof coaching is "virtually impossible." It is suggested that theCongress consider taking action to improve and objectify eligibilitydeterminations, possibly by eliminating the IFA altogether anddirecting that functional criteria be revised. Appendices describethe study's scope and methodology, efforts to effect implementationof the Supreme Court's decision, and studies previously done. (P8)

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Reproductions supplied by EDRS are the best that can be madefrom the original document.

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United States Genral Accounting Office

Report to Congressional Requesters

SOCIAL SECURITY

New FunctionalAssessments forChildren RaiseEligibility Questions

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Notice: This is a reprint of a GAO leport.

United StatesGeneral Accounting OfficeWashington, D.C. 20548

Health, Education, andHuman Services Division

B-257473

March 10, 1995

The Honorable Herb KohlThe Honorable David PryorUnited States Senate

The Honorable George W. GekasThe Honorable Gerald D. KleczkaThe Honorable Blanche Lambert LincolnThe Honorable Nick SmithHouse of Representatives

The number of children receiving Supplemental Security Income (ssi)benefits has nearly tripled over the last 5 years from 300,000 to almost900,000, and benefit payments now exceed $4 billion annually. The SocialSecurity Administration (ssA) awards ssi benefits to disabled children wholive in families with low incomes and limited resources. A number offactors have contributed to the growth in children's awards, includingoutreach efforts by SSA and child advocates, rising numbers of children inpoverty, and major changes in the criteria for determining whetherchildren are disabled. Growth has been especially rapid in awards tochildren with mental impairments.

Particularly troublesome have been allegations that parents coach theirchildren to fake mental impairments by misbehaving or doing poorly inschool so that they can qualify for cash benefits. These benefits canamount to almost $5,500 per year for each disabled child.' The coachingallegations, which have been widely reported by the media, have createdthe perception among the public that the program is vulnerable to fraudand abuse. In addition, concerns have been raised that the program couldfoster lifelong dependence on government assistance if children come toview the label "dizabled" as a lifetime entitlement to income and medicalbenefits. Finally, concerns have been raised about whether the program'seligibility criteria for children are too lenient. As a result of theseconcerns, reform of the ssi childhood disability program is now the subjectof congressional scrutiny.

In our October 21, 1994, briefing, you asked us to report on SSA'S new wayof assessing children's impainnents using the individualized functionalassessment (IFA) process mandated by the Supreme Court in Sullivan v.

'Benefits generally are provided without regard to the number of SSI recipients in the household. SSAestimated in March 1994 that 126,000 children receiving 551 Lived in households with at least one otherSSI recipient-

Page 1 GADMEHS-95-68 991: Childhood Eligibility Decisions

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Zebley. The new IFA process permits the award of benefits to children withimpairments that are less severe than the impairments that previouslycould justify an award. We assessed (1) the OA'S impact on the ssi rolls,(2) its implementation by SSA, and (3) its vulnerability to coaching.

To develop the information in this report, we (1) reviewed SSA'S childhooddisability program policies, procedures, and records, and discussed the IFAprocess with SSA program officials on the national, regional, and locallevel; (2) interviewed officials in state disability determination services(Dross); (3) reviewe SSA'S study of decisions made on childhood casesinvolving behavioral and learning disorders; and (4) attended a June 1994SSA training course designed to address the problems raised in the study.We also discussed eligibility issues with officials of the Department ofHealth and Human Services' (xxs) Office of Inspector General (IG), whichrecently issued two reports on the ssi childhood disability program. (Seeapp. I for more details on our scope and methodology.)

Results in Brief Changes in the regulations governing childhood eligibility for ssi have hada significant impact on the growth and composition of the childhooddisability rolls. In particular, awards have been made to more than 200,000children who did not meet SSA'S listing of impaliments but instead qualifiedfor benefits based on the less restrictive IFA criteria. These awards accountfor about $1 billion a year in benefit payments. About 84 percent of thechildren qualifying based on IFAS have mental impairments, and aboutone-half of the awards for behavioral disorders, including attention deficithyperactivity disorder, are based on the IFA criteria.

In our analysis, we found fundamental flaws in the IFA process.Specifically, each step of the process relies heavily on adjudicators'judgments, rather than objective criteria from SSA, to assess theage-appropriateness of children's behavior. As a result, the subjectivity ofthe process calls into question SSA'S ability to ensure reasonableconsistency in administering the ssi program, particularly for children withbehavioral and learning disorders.

In addition, rapid paigrarn growth, particularly in the award of benefits toless severely impaired children, may also have contributed to the publicconcern that parents could be coaching their children to fake mentalimpairments in order to qualify for benefits. Studies that we reviewed,however, have found little evidence that coaching is widespread, but theyrelied. solely on documentation in case files and, therefore, cannot rule out

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coaching. Although coaching allegations are troublesome, substantiatingthem and measuring the extent of coaching is virtually impossible.

Background Since 1974, the ssi program, under title XVI of the Social Security Act, hasprovided benefits to low-income blind and disabled personsadults andchildrenwho meet financial eligibility requirements and SSA'S definitionof disability. SSA determines applicants' financial eligthility; state DDSSdetermine their medical eligibility. DDSS are state agencies that are fundedand overseen by SSA. To meet the financial test, children must be infamilies with limited incomes and assets.

In 1994, children's federally administered sst payments totaled$4.52 billion. Depending on the family's income, an eligible child canreceive up to $458 per month in federal benefits; 27 states also offer asupplemental benefit payment. Because ssi is an individual entitlement, nofamily cap exists on the amount of benefits received in a household. WithSSI eligibility usually come other in-kind benefits, most notably Medicaidand Food Stamps.

The Social Security Act defines a disabled child as a person under age 18who "suffers from any medically determinable physical or mentalimpairment of comparable severity" to one that disables an adult. Thestatute defines adult disability in terms of an inability to work either in aformer job or in any other job in the national economy. Specifically, adultdisability is defined as the inability

"to engage in any substantial gainful activity by reason of any medically determinablephysical or mental impairment which can be expected to last a continuous period of notless than twelve months."

Because children are not expected to work, however, this definition is notapplicable to measure disability in children.

At a DDS, childhood disability determinations are made by an actjueicationteam consisting of an examiner and a medical consultant. For mentalimpairments, the consultant must be a psychiatrist or child psychologist.The examiner collects a medical evidencephysical and mentaleitherfrom medical sources who have treated the applicant or from anindependent consultant if more medical information is needed. Theexaminer supplements the medical information with accounts of the

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child's behavior and activities from the child's teachers, parents, andothers knowledgeable about the child's day-to-day functioning.

Working together, the DDS actudication team determines whether theapplicant's medical condition matches or is equivalent to an impairmentfound in SSA'S listing of medical impairments.2 If so, benefits are awarded.If, however, the applicant's condition is not severe enough to meet orequal the severity criteria in SSA'S ra ,dical listings, the team uses theevidence to perform an IFA. If the IFA shows the child's impairmentsubstantially reduces his or her ability to function age-appropriately,benefits are awarued. If not, a denial notice is issued, and applicants areinformed of their appeal rights.

SSI ChildhoodEligibility CriteriaHave UndergoneMajor Changes

During a 2-month period, SSA issued two sets of new regulations thatsignificantly changed the criteria for determining children's eligibility forssi disability benefits.3 One set of regulations, issued in accordance withthe Disability Benefits Reform Act of 1984 (DsRA), revised and expandedSSA'S medical listings for evaluating mental impainnents in children toincorporate recent advances in medicine and science. The second set ofregulations was issued in response to the Sullivan v. Zebley SupremeCourt decision, which required SSA to make its process for determiningdisability in children analogous to the adult process. Both sets ofregulations placed more emphasis on assessing how children'simpairments limit their ability to act and behave like unimpaired childrenof similar age. Both also emphasize the importance of obtaining evidencefrom nonmedical sources as part of this assessment.

DBRA RegulationsChanged SSAs MedicalListings for AssessingMental Impairments inChildren

SSA issued new regulations in accordance with DBRA on December 12, 1990.These new regulations revised and expanded SSA'S medical listings forchildhood mental impairments to reflect up-to-date terminology used bymental health professionals and recent advances in the knowledge,treatment, and methods of evaluating mental disorders in children. Thenew medical listings for mental impairments provided much more detailedand specific guidance on how to evaluate mental disorders in childrenthan the former regulations, which were published in 1977. In particular,the new medical listings placed much more emphasis on assessing how a

2S5A's listing of medical impairments describes impairmentsin terms of signs, symptoms, andlaboratory findingsthat are prestuned to be severe enough to disable an individual.

3For a complete description of these changes, see Social Security. Rapid Rise in Children on SS1Disability Rolls Follows New Regulations (GAOrtiEHS-94-226, Sept. 6, 1994).

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child's mental impairment limits his or her ability to function inage-appropriate ways. SSA made this change because mental healthprofessionals consider functional factors particularly important inevaluating the mental disorders of children.

The former medical listings for mental impairments emphasized themedical characteristics that must be met to substantiate the existence ofthe impairment. Specific areas of functioning sometimes were andsometimes were not mentioned as a factor in this determination. Incontrast, the new medical listings provide much more detailed guidanceon assessing the functional aspects of each impairment. The standard formost impairments is divided into two parts: medical and functionalcriteria, both of which must be satisfied for the applicant to qualify for abenefit.

The functional criteria are described in terms of the age of the child andthe specific areas of functioningsuch as social, communication/cognition, or personal/behavioral skillsthat must be assessed. The newmedical listings emphasize the importance of parents and others assources of nonmedical information about a child's day-to-day functioning.In general, the childhood mental listings require children over 2 years oldto have marked limitations in two of the four areas of functioning toqualify for benefits. Further, when standardized tests are available, thelisting defmes the term "marked" as a level of functioning that is twostandard deviations below the mean for children of similar age.

The new medical listings also classified childhood mental disorders intomore distinct categories of mental impairments. Previously, there were 4impairments listedmental retardation, chronic brain syndrome,psychosis of infancy and childhood, and functional nonpsychoticdisordersnow there are 11. Several of the newlyl d impairments, suchas autism and other pervasive developmental disorders, mood disorders,and personality disorders, describe impairments that were previouslyevaluated under one or more of the four broader categories of childhoodmental impairments. Several other impairments are mentioned for the firsttime, such as attention deficit hyperactivity disorder and psychoactivesubstance dependence disorders.

Zebley Regulations AddedSeparate FunctionalAssessment Process

14

On February 20, 1990, the Supreme Court ruled that SSA'S process fordetermining disability in children under 18 years old violated the SocialSecurity Act because the process held children to a more restrictive

Page 5 GAOffrEEIS.954 6 881: Childhood Eligibility Decisions

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disability stanuard than it did adults. In its opinion, the Court found thatthe process for children

"does not account for all impairments 'of comparable severity' [to adults], and denieschild claimants the individualized functional assessment that the statutory standardrequires ...."

To determine adults' eligibility for disability benefits, SSA uses a five-stepsequential evaluation process. Before Zebley, it used only a two-stepprocess to determine children's eligibility for benefits. (See fig. 1.)Children were awarded benefits only if their impairments met or equaledthe severity criteria in SSA'S medical listings. All other children were deniedbenefits. In contrast, adults whose conditions were not severe enough toqualify under the medical listings could still be found eligible for benefits ifan assessment of their residual functional capacity (RFc) showed that theycould not engage in substantial work. No analogous assessment offunctioning was done for children who did not qualify under the medicallistings.

Page 6 GAO/HELIS-95-66 551: Childhood Eligibility Decialone

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Figure 1: Disability Evaluation Process for Adults Versus Children

Adults

Step 1:Areyou

working?

Step 2:Do youhave

a severeimpairment?

Step 3:Does impairment

meet or equalseverity as defined

in SSA'smedical listings?

Step 4:Given RFC,

does impairmentallow yoi

to perform workdone in the past?

1

Step 5:Considering medical,vocational, and other

factors, can youperform generallyavailable work?

iDisabled accordingto vocational

factors

Not disabledDisabled according

to medicallistings

Children: Pre-ZebleyMIPMie .111=1MIMII

Step 1:Areyou

working?

Step 2:Do you have an

impairment that meetsor equals severity as

defined in SSA'smedical listings?

Not disabled

Page 70

Disabled accordingto medical

listings

Children: Post-Zebley1=1.1f.

Step 1:Areyou

working?

Step 2:Do youhave

a severeimpairment?

Step 3:Does impairment

meet or equalseverity as defined

in SSA'smedical listings?

MINN,

Step 4:Given IFA, isImpairment

comparably severe toone that would ,

disable an 'adult? I

Not disabledDisabled according

to medicallistings

Disabled accordingto functional

factors

GAO/HEBS-95-66 SSI: Childhood Eligibility Decleione

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To eliminate this disparity, the Court mandated that for those childrenwho do not qualify for benefits under the more restrictive medical listings,SSA must add a less restrictive individualized assessment of how the child'simpairment affects his or her ability to function in age-appropriatewaysthat is, to act or behave in ways that children of similar agesnormally dobefore it could decide whether the child was eligible forbenefits. The Court said that although a vocational analysis does not applyto children because they are not expected to work, SSA could make

"an inquiry into the impact of an impairment on the normal daily activities of a child of theclaimant's agespeaking, walking, dressing and feeding oneself, going to school, playing,etc."

Although the Court required the functional assessment, it did not definethe degree of limitation necessary to qualify for benefits, except byanalogy to the adult definition of disability.

To implement the Zebley decision, SSA convened a group of experts inApril 1990 to help formulate new regulations using age-appropriatefunctional criteria. Included were experts in general and developmentalpediatrics, child psychology, learning disorders, and early and adolescentchildhood education as well as advocates from groups such as CommunityLegal Services in Philadelphia (plaintiffs counsel in the Zebley case), theAssociation for Retarded Citizens, and the Mental Health Law Project. SSAalso consulted with its regional offices and the state DDSS.

Building on the functional criteria added to the listings after DBRA, SSAissued regulations implementing the Supreme Court's decision onFebruary 11, 1991.4 According to these regulations, for the child to beeligible for disability benefits, the WA must show that the child'simpairment or combination of impairments limits his or her ability "tofunction independently, appropriately, and effectively in anage-appropriate manner." Specifically, the impairment must substantiallyreduce the child's ability to grow, develop, or mature physically, mentally,or emotionally to the extent that it limits his or her ability to (1) attainage-appropriate developmental milestones; (2) attain age-appropriate dailyactivities at home, school, play, or work; or (3) acquire the skills needed toassume 'Kluft roles. Although SSA officials describe these as state-of-the-art

'Fmal regulations incorporating voluminous public comments were issued on September 9, 1993These regulations, which were not substantially different from the February 1991 interim finalregulations, have a September 9, 1997, sunset date, after which time they will no longer be effective,unless the Secretary of HI-1S extends, revises, or reissues them.

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criteria for assessing children's functioning, they concede that many ofthese concepts are not clear cut.

As a result of these regulations, DDSS now perform inks to assess the child'ssocial, communication, cognitive, personal and behavioral, and motorskills, as well as his or her responsiveness to stimuli and ability toconcentrate, persist at tasks at hand, and keep pace.6 Like the DBRAregulations, the IFA process requires DDSS to supplement medicalinformation with information about the child's behavior and activitiesfrom the child's teachers, parents, and others knowledgeable about thechild's day-to-day functioning in order to make these assessments.Generally, if the IFA shows that a child has a moderate limitation in threeareas of functioning or a marked limitation in one area and a moderatelimitation in another, benefits are awarded. In contrast, the morerestrictive functional criteria under SSA'S mental listings require twomarked limitations.

In addition to measuring functdoning as part of the WA process, the Zebleyregulations added the concept of functional equivalence to SSA'S medicallistings. Before Zebley, a child qualified for benefits only if his or herimpairment met or was medically equivalent to the severity criteria in thelistings. After Zebley, a child could qualify if his or her impairment wasfunctionally equivalent to an impairment in the medical listings, as long asthere was a direct, medically determinable cause of the functionallimitations. The regulations provide 15 examples of conditionssuch asthe need for a major organ transplantpresumed to be functionallyequivalent to the listed impairments.

IFA Process Has Hada Major Impact on theRolls

Of the 646,000 children added to the ssi rolls from February 1991 throughSeptember 1994, about 219,000 (one-third) were awarded benefits basedon the less restrictive WA process. If all 219,000 children receive themaxhnum benefit, their ssi benefits would cost about $1 billion a year.About 84 percent of these children had a mental impairment as theirprimary limitation, and about 16 percent had physical impairments. (Fig. 2shows a breakdown of the impairments.)

'Social, communication, cognitive, and motor skills tu.e assessed for children of all ages; personal andbehavioral skills are assessed for children 1 year old and older. The ability to concentrate, persist attasks at hand, and keep pace are assessed for children 3 years old and older, responsiveness to stimuliis assessed in children under 1 year old.

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Figure 2: Most IFA Awards Go toChildren With Mental Impairments

Physical

Mental

Source: Analysis of SSA's 831 file

Physical Impairments

Mental Retardation

Attention Deficit HyperactivityDisorder

8.6%PerFonality and Other BehavioralDisorders

Other Mental Illnesses

Figure 3 shows the substantial increase in the number of awards. Much ofthis increase was due to the implementation of new medical listings formental impairments. The WA process also added to the growth in the rollsand accounted for a substanbial portion of new awards. Figure 3 alsoshows that the average monthly number of applications jumpeddramatically after Zebley and has continued to grow. Many observersattribute this increase in applications to the publicity surrounding Zebley,as well as to increased outreach by ssA, some of which wascongressionally mandated.

13

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Also, some of the increase in awards may have been attributable to theclose scrutiny of the WA process by courts and disabled child advocates,which some believe may have resulted in some Dims feeling pressured toincrease their award rates during the 1991-1992 period. (App. 11 provides achronology of their actions.) Before the 'FA process was introduced in1991, the national award rate for all types of childhood cases was38 percent, but the award rate jumped to :6 percent in the first 2 yearsafter the WA and nskA regulations were issued. More recently, during 1993and 1994, the award rate has dropped dramatically. The national awardrate for 1994 was 32 percentlower than it was in the 2 years beforeZebley.

Figure 3: IFA and Changes in MedicalListings Both Contribute to Growth in 50000 Monthly Averagethe Rolls

40000

30000

20000

10000

1/1188-2/20/90 2/11/91-12/31/92 1/1/93-12/31/93 1/1/94-9/30194

IFA Awards

Listings Awards

Applications

Source: Analysis of SSA's 831 file.

IFA Process Has BeenDifficult to ImplementConsistently

Our review indicates that the IFA process has been difficult to implementconsistently and reliably, particularly for children with mentalimpairments, because the process requires adjudicators to make a seriesofjudgment calls in a complex matrix of assessments about

Page 11 GAO/HEM-95-68 881: Childhood Eligibility Decisions41

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age-appropriateness of behavior. SSA and IG studies of children with mentalimpairments have borne out these difficulties. Although SSA has tried toadd rigor to the IFA process through guidance and training, we believe thatproblems will likely continue because of the difficulties inherent in usingage-appropriate behavior as an analog for the adult vocational assessmentof residual functional capacity.

IFAA Complex ProcessThat Relies Heavily onAdjudicator Judgment

Determining disability for crdren with impairments that are not severeenough to match a listed impairment can be a highly subjective process.SSA designed the WA process to provide DDS actjudicators with a structure tohelp them make uniform and rational disability determinations forchildren with less severe impairments. Even so, the necessity to assess achild's ability to function age-appropriately requires DDS actjudicators tomake a series ofjudgments, which we believe raises questions about theconsistency and reliability of DDS decisions. SSA and IG studies and ouranalysis document problems throughout the IFA process, especially formental impairments. (See app. III for a more detailed discussion of theproblems that SSA and the IG identified.)

Extensive evidence needed: To make disability determinations, DDSS useinformation from both medical and nonmedical sources, includingteachers, day care providers, parents, and others knowledgeable about thechild's day-to-day behavior and activities. For the functional assessment,observations are needed about the child's behavior over a long period oftime, so evidence-gathering can be a considerable task. SSA found in its1994 study that the lack of sufficient supporting documentation was themost common problem in its sample of childhood disability decisions.

School officials in particular are an important source of nonmedical dataon children's behavior over time. Each DDS develops its ownquestionnaires for eliciting the data, and inquiries are made on virtuallyevery applicant because this information is also used to assess functioningunder the medical listings. We estimate that the process now results inabout 500,000 inquiries to schools each year, a substantial reportingburden. Some parties believe that the open-ended questionnaire design inmany states and the burden on school officials faced with many inquiriesmay be contributing to poor quality data from this key source.

Difficulty classifying limitations: If an WA iS needed, a disability acbudicatormust classify the child's limitations in the appropriate areas of functioning,as shown in figure 4. This is a complex judgment because some areas are

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closely interrelated and impairments may or may not affect functioning inmore than one area. lf, for example, evidence indicates that a child gets infights at school, the adjudicator must determine whether the specificbehavior is evidence of a limitation in social skills, personal andbehavioral skills, or some combination of these. SSA found that in cases ofincorrect awards a common mistake that adjudicators made was to countthe effect of an impairment in two areas when only one was appropriate.This resulted in the impairment seeming more severe than it actually was.

Problems defining degrees of limitation: Once the areas have beenidentified, the adjudicator must judge the degree of limitation. Becauseonly certain conditionssuch as low intelligence quotient (IQ)can beobjectively tested and determined, SSA has defined the severity oflimitations by comparison with expected behavior for the child'schronological age. Figure 4 shows the degrees of limitation adjudicatorsuse to assess children 3 through 15 years old. SSA'S guidance defines alimitation in the moderate category as more than a mild or minimallimitation but less than a marked limitation. The terms "mild" and"minimal" are not defmed, but SSA guidance describes an impairment in themarked category as one that "seriously" interferes with a child's ability tofunction age-appropriately, while a moderate limitation creates"considerable" interference. Within each category, adjudicators areexpected to be able to differentiate the degree of limitation. For example,a moderate rating can range from a "weak moderate" (just above aless-than-moderate) up to a "strong moderate" (just below a markedlimitation).

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Figure 4: Structure of the IFA Process

Degree of limitation

Area of limitation

Cognitive ability

No evidO000Less thanmoderate :-MOCfarriNt.

"1011.6411.1611.1146110 ......010014.1.0.10161,111110.61.1.....1140

Marked Extreme

Communication ability ,41*

Social skills, 66666 11.144.

..111111.11,11.0,91101.1.6019. 11),1,11. .

Concentration, persistence,and pace in completing tasks

Motor skills 11111H4.1MWOWSMIN111H01. 4111111. 41-*Response to stimuli

4611.1.11.11.14............liii.161.1.1.1.11.

Limited guidance for summing the result: Because the IF'A process isinherently subjective, SSA cannot provide an objective procedure forsuimuarizing the IFA results. Therefore, ssA instructs adjudicators to stepback and assess whether the child meets the overall definition ofdisability. As an example to guide adjudicators, ssA has said that an awardmay generally be granted if a child has a moderate limitation in threeareas. However, SSA officials stress that this statement assumes "threegood, solid moderates," and they characterize it as a general guideline, nota firm rule. Also, they stress that other possible combinations of ratings,such as two strong moderates, could justify finding a child disabled,depending on the individual child's circumstances. In the end, officialsstress that adjudicators are expected to award or deny benefits based onan overall judgment, not on any specific sum of severity ratings.

SSA and IG StudiesHighlight IFA Difficulties

SSA'S 1994 study of 325 childhood awards highlighted the difficulties inusing the 1FA process to reliably identify disabled children, particularly

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children with behavioral and learning disorders.6 In the study, SSA'S Officeof Disability selected cases of 325 children with behavioral and learningdisorders who had been found eligible. The majority were found eligiblebased on IFAS. These cases had been decided by DDS adjudicators, based ontheir understanding of existing guidance from SSA. Then, SSA'S regionalquality assurance staff had reviewed the decisions and found themaccurate. The study involved a third group of experts Ln the Office ofDisability who reviewed the same cases and found inaccuracies in thedecisions. Based on their findings, we concluded that about 13 percent ofthe awards reviewed by SSA had been made to children who were notimpaired enough to qualify. Also, another 23 percent of the awards hadbeen made without sufficient supporting documentation.'

A January 1995 IG report focused on 'FA-based awards to children withmental impairments. Io sta.ff, with assistance from the Office of Disability,reviewed 129 'FA-based awards for mental retardation, attention deficithyperactivity disorder, and other behavioral or learning disorders. The IGfound that 17 (13 percent) of the awards should have been denials andanother 38 (29 percent) had been based on insufficient evidence. The IGattributed this to DDS adjudicators' difficulty interpreting and complyingwith SSA'S WA guidelines for assessing the severity of children's mentalimpairments. Many adjudicators reported that they found the SSAguidelines unclear and not sufficiently objective. The IG stated that thisgroup of children had less severe impairments than those childrendetermined disabled based on the medical listings, making the assessmentof their impairments' effect on their ability to function age-appropriatelymore difficult.

We observed firsthand the difficulty that adjudicators face in making thejudgments required by the IFA process for children who have behavioraland learning disorders. In June 1994, we attended 1-day training sessionsfor DDS adjudicators and SSA'S regional quality assurance staff from acrossthe nation. The Office of Disability presented the findings from its 1994study and discussed the policies and procedures that DDS and qualityassurance staff had misapplied. In this training, Office of Disability staffpresented case studies of children included in the 1994 study. After thosein attendance reviewed the evidence for each child's case, they were askedto assess the degree to which the child's impairment limited his or herfunctioning. The attendees' opinions were tallied and in all cases theywere split. During discussions of each case, attendees often voiced

'The study's sampling methodobgy does not pennit the results to be projected to the universe ofchildhood cases or to any subset of the universe.

'See appendix III for details on the study and how we calculated these percentages.

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differing views on why they believed, for example, that the child'slimitation was less than moderate or moderate, or whether a moderatelimitation was a good, solid moderate, or a weak moderate. In some cases,the opinion of the majority of attendees turned out to be different from theconclusion of the Office of Disability.

In addition to the natonal training in June 1994, SSA took other steps tocorrect implementation problems, including (1) issuing numerousinstructional clarifications and reminders, (2) requiring DDSS to speciallycode certain types of mental impairments and all decisions based on threemoderate limitations (to facilitate selecting samples of cases for furtherstudy), and (3) establishing more rigorous requirements for documentingawards that are based on three moderate limitations. The Office ofDisability plans to do a follow-up study to assess the effectiveness of itsremedial efforts.

Some experts believe that further steps could be taken to improve the IFAprocess. For example, experts we contacted commented on the need formore complete longitudinal evaluations by professionals. They pointed outthat more complete examinations--sometimes including multiple visitsand observations of both parents and childrenwould help to addressconcerns about the adequacy of information from schools and medicalsources and provide higher assurance of good decisions. They stated thatbecause professionals are trained to identify malingering in mentalexaminations, the expanded examinations might also help relieveconcerns about coaching. They agreed that such examinations would raisethe program's administrative costs considerably, but because a child canreceive alinost $5,500 a year in benefits (which can continue for life) theybelieved that the costs would be justified.

SSA'S efforts and experts' suggestions are geared toward improving theprocess rather than addressing the underlying conceptual problems withthe IFA. The difficulties so far in implementing the rFA bring into questionwhether these types of incremental actions can ensure consistentlyaccurate decisions for children with mental impairments, especiallybehavioral and learning disorders.

Extent of CoachingUnknown

The rapid growth in awards to children with mentalimpairmentsparticularly behavioral and learning disordershascontributed to the public perception that the sst program for children isvulnerable to fraud and abuse. The media have reported allegations that

Page 16 GAO/HEM-96-66 881: Childhood Eligibility Decisions

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parents coach their children to fake mental impairments by misbehavingor performing poorly in school so that they can qualify for ssi benefits.Critics believe that cash payments and Medicaid act as incentives for someparents to coach and, therefore, they are concerned about the extent towhich parents can manipulate the disability determination process.However, we believe that measuring the extent to which coaching mayactually occur is extremely difficult.

Unless parents admit to it, coaching is almost impossible to substantiate.The nature of the parent-child relationship makes investigating coachingallegations difficult. Many communications between parent and child takeplace at home, out of the view of outside observers. In addition, thevariability of children's behavior makes knowing whether a child'sbehavior is the result of coaching difficult. Behavior can vary naturallyamong children of the same ageor in the same child over timeas theygo through stages in development or respond to changes in their home orschool environment. If a child started misbehaving in school, investigatorswould need baseline evidence to establish that the child had notmisbehaved extensively in the past. Finally, even if investigators couldidentify a sudden change in behavior, they would have to rule out otherreasons for the change, such as changes in the child's household orneighborhood environment. In short, knowing whether the child isperforming poorly or misbehaving because of coaching or for otherreasons is difficult.

Because coaching is difficult to detect, the extent of coaching cannot bemeasured with much confidence. In recent studies, SSA and the Ems toreviewed case files and identified scant evidence of coaching ormalingering.8 In the rare instances where they found evidence of possiblecoaching or malingering, most of the claimants had been denied benefitsanyway. (App. HI summarizes the results of the SSA and IG studies,including their scopes and methodologies.)

Actions to ReduceProgram's PossibleVulnerability to Coaching

To protect program integrity, SSA has taken several steps to help provideassurance that the process can detect coaching or malingering and thenmake the appropriate eligibility determination. In June 1994, SSA beganrequiring DDSS to report to SSA'S regional quality assurance units any case

8SSA considered possible coaching to be involved in any case in which the child reported or aninformation source suspected that the parent or other caregiver had told the child to misbehave orperform poorly. SSA also looked for evidence that the child had malingered; that is, deliberatelyprovided wrong information or did not put forth his or her best effort during testing, regardless ofwhether coaching was suspected.

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with an allegation or suspicion of coaching. Such cases include those inwhich teachers, physicians, or psychologists indicate that (1) the child'sbehavior was atypical of the child's customary school behavior, (2) thechild was uncooperative during testing, or (3) the child's behaviordeteriorated without explanation during the 6-month period preceding theapplication. According to SSA, its regional quality assurance units reviewall alleged cases of coaching. As of mid-January 1995, DDSS nationwide hadreported alleged coaching in 674 childhood casesor less than one-half of1 percent of all childhood applications filed during the periodand fewerthan 50 of these children had been awarded benefits.

Along with this new requirement, in August 1994, SSA required DDSS to sendapplicants' schools a set of questions specifically designed to elicit theteacher's views on whether the child had been coached. Additionally, eachSSA regional office has established toll-free telephone numbers for theexclusive use of teachers and school officials to notify the regional qualityassurance unit of coaching allegations. In mid-November 1994, SSAinstructed DDSS to begin distributing these toll-free numbers to schools.Also, SSA has instructed its field offices and telephone service centers toreport to the regional quality assurance units any allegations of coachingreceived from the general public. As of mid-January 1995, from all of thesesources, SSA had received a total of 42 telephone calls with allegations ofcoaching involving 54 individuals. According to SSA, each allegation fromteachers, school officials, or the general public is reviewed if the child wasawarded benefits.

Conclusion Childhood disability decisions based on the WA process are among thetoughest that DDSS must make. Particularly in assessing behavioral andlearning disabilities, the level ofjudgment required makes the IFA processdifficult to administer consistently. Moreover, the high level of subjectivityleaves the process susceptible to manipulation and the consequentappearance that children can fake mental impairments to qualify forbenefits. Indeed, the rise in allegations of coaching may reflect publicsuspicion of a process that has allowed many children with less severeimpairments to qualify for benefits. Although scant evidence exists tosubstantiate that coaching is a problem, coaching cannot be ruled out andits extent is virtually unmeasurable.

We believe that a more fundamental problem than coaching is determiningwhich children are eligible for benefits using the new WA process. Ouranalysis documents the many subjective judgments built into each step of

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111MNIMMENEMMMIIMINI=

Matter forConsideration by theCongress

the WA process to assess where a chld's behavior falls along thecontinuum of age-appropriate functioning. Moreover, studies by SSA andthe IG of children awarded benefits for behavioral and learning disordersillustrate the difficulties that SSA has experienced over the last 4 years mmaking definitive and consistent eligibility decisions for children withthese disorders.

SSA'S efforts have been aimed at process improvements rather thanreexamining the conceptual basis for the WA. Despite its efforts, too muchadjudicator judgment remains. Although better evidence and more use ofobjective tests where possible would improve the process, the likelihoodof significantly reducing judgment involved in deciding whether a childqualifies for benefits under the IFA is remote. We believe that moreconsistent decisions could be made if adjudicators based functionalassessments of children on the functional criteria in SSA'S medical listings.This change would reduce the growth in awards and target disabilitybenefits toward children with more severe impairments.

Given widespread concern about growth in the ssi program for childrenand in light of our findings about the subjective nature of the IFA process,the Congress could take action to improve eligibility determinations forchildren with disabilities. One option the Congress could consider is toeliminate the IFA, which would require amending the statute. The Congresscould then direct SSA to revise its medical listings, including the functionalcriteria, so that all children receive functional assessments based on theserevised criteria.

. ) II-Page 19 GAD/HEM-95.66 991: Childhood Eligibility Decisions

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We did not request official agency comments from SSA on a draft of thisreport. However, we discussed the draft with SSA program officials, whogenerally agreed that we had accurately characterized the IFA process andthe results of studies. SSA officials had some technical comments, whichwe have incorporated where appropriate.

Please contact me on (202) 512-7215 if you have any questions about thisreport. Other major contributors are Cynthia Bascetta, Ira Spears, KenDaniell, David Fiske, and Ellen Habenicht.

Jane L. RossDirector, Income Security Issues

4,, 0

Page 20 GAWHE119-95-66 991: Childhood Eligibility Decisions

Contents

Letter

Appendix IScope andMethodology

Appendix IIEfforts to AffectImplementation of theZebley Decision

Appendix IIIStudies Done by SSAand the InspectorGeneral

Figures

1

24

26

January 1991 26

February 1991 26

June 1991 27

December 1992 27

28

1994 Study by SSA's Office of Disability 28Inspector General Study 30

Figure 1: Disability Evaluation Process for Adults Versus 7

ChildrenFigure 2: Most IFA Awards Go to Children With Mental 10

ImpairmentsFigure 3: IFA and Changes in Medical Listings Both Contribute to 11

Growth in the RollsFigure 4: Structure of the IFA Process 14

Abbreviations

DBRA

DDS

FIBS

IFA

IG

IQ

RFC

SSA

ssl

Page 22

Disability Benefits Reform Act of 1984disability determination serviceHealth and Human Servicesindividualized functional assessmentInspector Generalintelligence quotientresidual functional capacitySocial Security AdministrationSupplemental Security Income

Lit GAO/HERS-95-66 SSI: Childhood Eligibility Decisions

Appendix I

Scope and Methodology

To develop the information in this report, we (1) reviewed SSA'S childhooddisability program policies, procedures, and records, and discussed the IFAprocess with SSA program officials on the national, regional, and locallevel; (2) interviewed officials in state DDSS; (3) reviewed SSA'S report on its1994 study of children with behavioral and learning disorders; and(4) attended a June 1994 SSA training course that was based on findingsfrom its study. We also discussed eligibility issues with officials of xxs' 1G,which recently issued two reports on the ssi childhood disability program.°

To develop ssi childhood program award rate data, we obtained SSA'Scomputerized records on the results of initial determinations andreconsideration disability decisions made by DDSS for children under 18years old from 1988 through September 1994.1° These records exclude theresults of disability decisions made by administrative law judges. Fromthese records, we determined (1) the overall award rate for children,(2) the percentage of IFA awards that were based on mental impairmentsversus physical impairments, (3) the average monthly number ofchildhood applications, and (4) the average monthly number of awardsthat were based on IFAS versus medical listings. These data, as applicable,were determined for the following periods: (1) 2 years before the SupremeCourt's Sullivan v. Zebley decision (Jan. 1, 1988, through Feb. 20, 1990);(2) 2 years a.fter the IFA process was implemented (Feb. 11, 1991, throughDec. 31, 1992); (3) January-December 1993; and (4) January-September 1994. Because no IFA process existed before the Zebleydecision, no pre-Zebley awards were decided based on IFAS.

We excluded children who had applied during 1988 through February 10,1991, from the universe of children on whom decisions were made fromFebruary 11, 1991, through September 30, 1994. We did this to minimizethe extent to which data in these comparison periods reflect the result ofcases regjudicated as part of the settlement in the Zebley class actionlawsuit. We were not able to identify or exclude Zebley classmembers forwhom benefits had been denied or terminated from 1980 through 1987from any of the comparison periods. According to SSA, Zebley

°See Concerns About the Participation of Children with Disabilities in the Supplemental SecurityIncome Program (A-03-94-02602), Department of Health and Human Services, Office of InspectorGeneral (Oct. 13, 1994); and Suppleraental Security Income: Disability Determinations for Childrenwith Mental Impairments (A-03-94-02603), Department of Health and Human Services, Office ofInspector General (Jan. 26, 1996).

1°The childhood program statistics presented in this report were developed using the same basicmethodology used in Social Security: Rapid Rise in Children on SSI Disability Rolls Follows NewRe ulations (GAO/H8HS-94-225, Sept. g, 1994). This report focused on the growth in awards after SSAc anged the disability criteria for children.

Page 24 GAD/HEHS-95-66 SW: Childhood Eligibility Decisions

Appendix IScope and Methodology

classmembers are more likely to have physical impairments than thegeneral population of new sst child applicants.

We performed our work from May 1994 through February 1995 inaccordance with generally accepted government auditing standards.

' C

Page 25 GAO/HEHS-95-68 SSI: Childhood Eligibility Decisions

Appendix II

Efforts to Affect Implementation of theZebley Decision

January 1991

February 1991

One month before SSA issued regulations implementing the new 1FAprocess, the Zebley plaintiTs counsel submitted interrogatories to SSAasking, among other things, why nine DDSS with the lowest award rates forchildren had such low award rates."

SSA regional officials were tasked with answering some of the counsel'sinterrogatories and, in some instances, the officials informed the statesthat they were the subject of the counsel's inquiry. Also, from time to timethereafter, ssA officials shared state-by-state award rate data with stateDDSS. Some SSA regional officials stated that they believed some DDSS couldhave felt pressured to increase their award rates.

In the month that SSA issued regulations implementing the new 1FA process,a federal district court ordered SSA to perform special quality assurancereviews of disability applications denied under the new regulations. Thecourt order required SSA to do quality assurance reviews of denials madeby 10 state DDSS that, according to SSA, Zebley plaintiffs counsel hadidentified as denial prone due to their low award rates.12 Based on its ownstudies, SSA had argued before the court that low award rates were notreliable indicators of whether special corrective action was needed toavoid incorrect denials, but the court required SSA to implement the specialquality assurance reviews for these 10 states.

Under the court order, during the first month after the new regulationswere in effect, SSA had to review the lesser of 100 or all denials for eachdenial-prone state. ssA reviewed only 25 denials for other states. Asubsequent March 1991 court order required SSA, after the first month, toreview at least 1,000 denials per month nationwide. SSA'S sample of 1,000denials included 15 percent of the denials from each of the 10 denial-pronestates.

By memorandum in February 1991, SSA informed all DDSS of the specialquality assurance requirements and identified the 10 states that had beenclassified as denial prone. The court order required that SSA send theresults of the quality assurance reviews monthly to the Zebley plaintiffscounsel.

"The nine states were Alabama, Arkansas. Colorado, Louisiana, Mississippi, Nebraska, South Carolina,West Virginia, and Wisconsin.

"The 10 states were Alabama, Arkansas. Colorado, Louisiana, Mississippi, Nebraska, New Mexico,South Carolina, West Virginia, and Wisconsin

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Appendix HEfforts to Affect Implementation of theZebley Decision

The Zebley plaintiffs counsel wrote to the SSA Commissioner citing a"disturbing pattern" of low allowance rates in eight states and asked theCommissioner to take remedial steps.'

In a newsletter to legal aid societies, the Zebley counsel listed 13 DDSSwhose cumulative allowance rates were at 50 percent or below." Thecounsel encouraged legal aid society representatives in those states tocontact the DDS directors and "confront them with their sub-parperformance."

IlThe eight states were Connecticut, Kentucky, Louisiana, Nebraska, New Mexico, Texas, WestVirginia, and Wisconsin

14The 13 states were Arkansas, Connecticut, Louisiana, Mame, Mississippi, Missouri, Montana,Nebraska, New Mexico, South Carolina. Tennessee, Texas, and West Virginia_

Page 272E

GAO/HERS-96-66 SSI: Childhood Eligibility Decisions

Appendix Ill

Studies Done by SSA and the InspectorGeneral

1994 Study by SS.NsOffice of Disability

SSA considers behavioral and learning disorders to be the most susceptibleto coaching and malingering. In 1994, SSA'S Office of Disability in Baltimorereviewed a national sample of 617 school-age children who had applieddue to behavioral and learning disorders. Because the sample was small,the fmdings of the study cannot be projected to the universe of childhooddisability claims or to the subset of specific impairments studied.

Scope and Methodology The 617 children were selected from those who had applied due to suchimpairments as attention deficit disorder, attention deficit hyperactivitydisorder, personality disorder, conduct disorder, learning disorder,oppositional defiant disorder, anxiety disorder, developmental delay,behavior disorder, speech and language disorders, borderline intellectualfunctioning, and adjustment disorder. According to SSA, these types ofdisorders constitute about 20 percent of all childhood disabilityapplications. SSA excluded cases involving extremely severe mentaldisorders, such as psychotic disorders and mental retardation.

SSA selected the 617 cases from final DDS decisions that SSA'S regionalquality assurance staff had already reviewed for accuracy. The 617 cases inthe sample consisted of 325 awards and 292 denials that DDSS adjudicatedduring October 1992 through July 1993. SSA reviewed case filedocumentation for the 617 cases.

Coaching In its review of case file documentation, SSA eonsidered coaching to beinvolved in any claim in which the child reported or an information sourcesuspected that the parent or other caregiver had told the child to act orrespond in a manner that would make the child appear more functionallylimited than he or she actually was. In addition, SSA looked for evidenceindicating that the child had malingered; that is, deliberately providedwrong information or did not put forth his or her best effort during testing.

SSA found only 13 cases that showed any evidence of possible coaching ormalingering, and only 3 of these cases were awards. In all cases, theevidence indicating possible coaching was provided by medicalprofessionals or psychologists who performed consultative examinationsfor SSA. None of the evidence indicating possible coaching ot malingeringwas provided by schools. The three questioned awards involved childrenwho may have malingered during IQ testing. In these cases, however, theawards were based on factors other than the results of the testing. Forexample, one child with an oppositional defiant disorder appeared to

Page 28 2 GADMEHS95-68 881: Childhood Eligibility Decisions

Appendix IIIStudies Done by SSA and the InspectorGeneral

malinger during IQ testing administered by a consultative examiner, but theaward was based on other problems stemming from the disorder, not theresults of the testing.

Of the 325 awards reviewed by SSA, SSA found that 8.6 percent (28) shouldhave been denials and another 27.7 percent (90) should not have beenmade without obtaining more supporting documentation. We asked SSA,based on experience in its quality assurance program, to estimate howmany of the 90 cases with insufficient documentation would have beendenials if all documentation had been obtained, and SSA estimated that 13(or 4 percent of the 325 awards) would have been denials. Thus, weconcluded that a total of 41 awards (12.6 percent of the 325 awards)should have been denials. By contrast, of 292 denials reviewed in thestudy, SSA found that only 1.4 percent (4) should have been awards, andanother 1.4 percent (4) should not have been made without obtainingmore supporting documentation.

Combining all decisional and documentational errors for the 617 denialsand awards in ssA's study, the overall error rate for this group of cases was20.4 percent.15 This is about twice the maximum acceptable error rate of9.4 percent that SSA allows for decisional and documentational errorscombined for all initial disability decisions r ade by an individual DDS.

According to SSA'S Office of Disability, a primary reason that DDSS madeawards that should have been denials was that DDSS had frequentlyoverratedbut rarely underratedthe severity of children's functionallimitations. Such overrating occurred primarily because DDSS had(1) compared the child with the perfect child rather than the average child,(2) based the limitation on a single incident rather than behavior overtime, (3) not considered the child's ability to function while on an effectivemedication regimen, and (4) based the limitation on the child's lifecircumstances rather than the effects of a medically determinableimpairment.

DDSS also had mechanically applied SSA'S guidelines on how to makeawards using the results of the IFA process. SSA'S guidelines instruct DDSSthat they generally should award benefits to children who have moderatelimitations in any three of the areas of ability assessed in the IFA process.SSA found, however, that DDSS had used this instruction as a rule rather

IfrThe overall error rate for the 617 cases was computed as follows: (28 award decisional errors + 90award documentations' errors + 4 denial decisional errors + 4 denial documentational errors)/ 617 .0.204.

Page 29 30 GAO/REHP-95.66 851: Childhood Eligibility Decisions

Appendix IIIStudies Done by SSA and the InspectorGeneral

than a guideline. DDSS had automatically made awards to any child withthree moderate limitations, regardless of how strong or weak themoderate limitations were. SSA stated that its guideline assumed "threegood, solid moderates." SSA found that, when DDSS had identified twomoderate limitations, they sometimes male special attempts to find a thirdmoderate limitation even though the evidence did not support it.

DDSS had also "double-weighed" the effects of impairments in more thanone of the areas of ability assessed in the IFA process, making theimpairment seem more severe and pervasive than it actually was. Forexample, in some cases children displayed a lack of self-control byexhibiting more than one inappropriate behavior, such as fighting,aggressive behavior, disrespectful behavior, lying, oppositional behavior,and stealing. Although all these behaviors should have been rated only inthe personal/behavioral area, DDSS had rated some behaviors in thepersonal/behavioral area and others in the social abilities area, giving thechild moderate limitations in two areas rather than only one. This meantthat the child needed only one more moderate limitation to have the threemoderate limitations needed for approval.

SSA also found that DDSS had sometimes bastd decisions on old evidencewhen current evidence indicated children had improved and that DDSS hadsometimes assessed limitations that could not be attributed to medicalimpairments.

Inspector GeneralStudy

As the IG reported in January 1995, IG staff reviewed the case files for asample of 553 children whose applications were actjudicated by DDSS in1992. Of the 553 children, 298 had been awarded benefits by 10nnssConnecticut, Illinois, Kentucky, New York, North Carolina, NorthDakota, Pennsylvania, South Dakota, Vermont, and Wisconsin. Theremainder of the 553 cases consisted of a nationwide sample of 255denials. Of the 298 awards, 129 (43 percent) had been decided based on anIFA, and 195 of the 255 denials (76 percent) had been decided based on anIFA. The IG targeted its study at cases involving mental retardation,attention deficit hyperactivity disorder, and other learning and behavioraldisorders. Based on its review of these cases, 10 officials told us that theyhad found no evidence of coaching.

As the IG reported, when the IG staff had questions about the accuracy ofaDDS disability determination or about the sufficiency of the evidencesupporting a determination, the IG provided the case file to SSA'S Office of

Page 80 31 GAWHEIIS-95.88 SSI: Childhood Eligibility Decisions

Appendix IIIStudies Done by SSA and the InspectorGeneral

Disability in Baltimorethe same staff responsible for conducting SSA'Sstudy of 617 childhood disability claims. The Office of Disability reviewedthe accuracy of each of the questioned cases. The IG staff also visited the10 opss to obtain their opinions on the adequacy of the SSA guidelines usedto make disability determinations.

Of the 129 awards reviewed that were based on wAs, the It: reported that17 (13 percent) should have been denials and another 38 (29 percent) werebased on insufficient evidence. The IG attributed this problem to DDSShaving difficulty in interpreting and complying with ssA guidelines furobtaining and evaluating evidence concerning the severity of the mentalimpairments of children on whom WAS are conducted. The IG stated thatthese children have less severe impairments thrAn those childrendetermined to be disabled based on the impairment listing, making theassessment of the effects of their impairments on their ability to functionage-appropriately more difficult. In discussions with employees of the 10DDSS, the IG reported that many expressed concern that the SSA guidelinesfor determining disability for children with mental impairments were notsufficiently clear or objective.

(106589) Page 81 GAO/REHS-95-88 8511 Childhood Eligibility Decialons

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