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How to fix the backlog of disability claims

The American people deserve to have a federal government that is both responsive and effective. That simply isn’t the case for more than 1 million people who are awaiting the adjudication of their applications for disability benefits from the Social Security Administration.

Washington can and must do better. This gridlock harms applicants either by depriving them of much-needed support or effectively barring them from work while their cases are resolved because having any significant earnings would immediately render them ineligible. This is unacceptable.

Within the next month, the Government Accountability Office, the nonpartisan congressional watchdog, will launch a study on the issue. More policymakers should follow GAO’s lead. A solution to this problem is long overdue. Here’s how the government can do it.

Congress does not need to look far for an example of how to reduce the SSA backlog. In 2013, the Veterans Administration cut its 600,000-case backlog by 84 percent and reduced waiting times by nearly two-thirds, all within two years. It’s an impressive result.

Why have federal officials dealt aggressively and effectively with that backlog, but not the one at SSA? One obvious answer is that the American people and their representatives recognize a debt to those who served in the armed forces. Allowing veterans to languish while a sluggish bureaucracy dithers is unconscionable. Public and congressional outrage helped light a fire under the bureaucracy. Administrators improved services the old-fashioned way — more staff time. VA employees had to work at least 20 hours overtime per month.

Things are a bit more complicated at SSA, unfortunately. Roughly three quarters of applicants for disability benefits have their cases decided within about nine months and, if denied, decide not to appeal. But those whose applications are denied are legally entitled to ask for a hearing before an administrative law judge — and that is where the real bottleneck begins.

There are too few ALJs to hear the cases. Even in the best of times, maintaining an adequate cadre of ALJs is difficult because normal attrition means that SSA has to hire at least 100 ALJs a year to stay even. When unemployment increases, however, so does the number of applications for disability benefits. After exhausting unemployment benefits, people who believe they are impaired often turn to the disability programs. So, when the Great Recession hit, SSA knew it had to hire many more ALJs. It tried to do so, but SSA cannot act without the help of the Office of Personnel Management, which must provide lists of qualified candidates before agencies can hire them. SSA employs 85 percent of all ALJs and for several years has paid OPM approximately $2 million annually to administer the requisite tests and interviews to establish a register of qualified candidates. Nonetheless, OPM has persistently refused to employ legally trained people to vet ALJ candidates or to update registers. And when SSA sought to ramp up ALJ hiring to cope with the recession challenge, OPM was slow to respond.

In 2009, for example, OPM promised to supply a new register containing names of ALJ candidates. Five years passed before it actually delivered the new list of names. For a time, the number of ALJs deciding cases actually fell. The situation got so bad that the president’s January 2015 budget created a work group headed by the Office of Management and Budget and the Administrative Conference of the United States to try to break the logjam. OPM promised a list for 2015, but insisted it could not change procedures. Not trusting OPM to mend its ways, Congress in October 2015 enacted legislation that explicitly required OPM to administer a new round of tests within the succeeding six months.

These stopgap measures are inadequate to the challenge. Both applicants and taxpayers deserve prompt adjudication of the merits of claims. The million-person backlog and the two-year average waits are bad enough. Many applicants wait far longer. Meanwhile, they are strongly discouraged from working, as anything more than minimal earnings will cause their applications automatically to be denied. Throughout this waiting period, applicants have no means of self-support. Any skills applicants retain atrophy.

The shortage of ALJs is not the only problem. The quality and consistency of adjudication by some ALJs has been called into question. For example, differences in approval rates are so large that differences among applicants cannot plausibly explain them. Some ALJs have processed so many cases that they could not possibly have applied proper standards. In recognition of both problems, SSA has increased oversight and beefed up training. The numbers have improved. But large and troubling variations in workloads and approval rates persist.

For now, political polarization blocks agreement on whether and how to modify eligibility rules and improve incentives to encourage work by those able to work. But there is bipartisan agreement that dragging out the application process benefits no one. While completely eliminating hearing delays is impossible, adequate administrative funding and more, better trained hearing officers would help reduce them. Even if OPM’s past record were better than it is, OPM is now a beleaguered agency, struggling to cope with the fallout from a security breach that jeopardizes the security of the nation and the privacy of millions of current and past federal employees and federal contractors. Mending this breach and establishing new procedures will — and should — be OPM’s top priority.

That’s why, for the sake of everyone concerned, responsibility for screening candidates for administrative law judge positions should be moved, at least temporarily, to another agency, such as the Administrative Conference of the United States. Shortening the period that applicants for disability benefits now spend waiting for a final answer is an achievable goal that can and should be addressed. Our nation’s disabled and its taxpayers deserve better.

Henry J. Aaron is the chair of the Social Security Advisory Board, a senior fellow in Economic Studies at the Brookings Institution, and served in the Carter administration. Lanhee J. Chen is a member of the Social Security Advisory Board, a research fellow at the Hoover Institution, a policy director for the Romney-Ryan 2012 presidential campaign, and served in the George W. Bush administration.

Henry Aaron
Lanhee Chen