SSDI: A Program Subject to Abuse

A new report from the Office of Inspector General at the Social Security Administration shines the spotlight on the widespread abuse taking place within the Social Security Disability Insurance program and identifies the extent to which the Social Security Administration does or does not have the systems and tools in place to fight fraud and abuse.

A new report from the Office of Inspector General at the Social Security Administration identifies the degree to which the agency does or does not have the systems, infrastructure or policies in place to stop the growing abuse that is taking place in the Social Security Disability Insurance (SSDI) program.

The report notes that as early as 1938 when the concept of providing benefits to disabled workers was first discussed that concerns about potential abuse to the program were expressed even at that time prior to implementation. One actuary noted at the time, “unless a highly qualified medical staff examined each applicant, the cost of the [disability insurance] program would be higher than ‘anything that can be forecast.'”

The first disability payments were paid in 1957. The report states that from the outset, the SSDI program has experienced delays in processing times and that the program also has “failed to rehabilitate the majority of beneficiaries.” These are ongoing concerns that remain and also are contributing to the insolvency of the program, namely that the 2013 annual report from the Social Security Trust Funds Board of Trustees notes that SSDI reserves “will continue to decline until they’re depleted in 2016.”

There are three stages to the disability claims process which the report examines in detail from a fraud prevention perspective: the initial application, the administrative appeals process in which applicants can request reconsideration of a denied claim, and the post-entitlement stage in which individuals are receiving benefits but may conceal from SSA factors affecting their continued eligibility.

The report found that SSA lacks comprehensive record profiling systems for tracking an applicant’s record over time, leaving opportunities for fraud, and it also found that SSA lacks sufficient front-end fraud detection systems at the application stage due to dated and unintegrated systems. The report notes that SSA does not regularly update its listing of medical impairments which might be used to define disabilities, and therefore “the listings may not be as effective a screening tool as they have been in the past.”

The report recommends that Social Security should: invest in predictive analytics tools to identify claims likely to be fraudulent; invest in a comprehensive searchable system of records to identify and review trends in claims with common characteristics; modernize disability policy to reflect advances in medicine and technology; continue oversight of performance and productivity of Administrative Law Judges; and make all efforts to allocate resources to clear the continuing disability review backlog.

House Ways and Means Social Security Subcommittee Chairman Sam Johnson (R-TX) requested the report and has been critical of the amount of fraud within the SSDI program. Johnson said in a statement that the report is proof that fraud preventions are lacking and encouraged the acting commissioner of Social Security to adopt the report’s recommendations.

According to Johnson, “The Inspector General’s report confirms what I have always known – that Social Security has failed to make fighting fraud a top priority. Many changes, like improving computer system screening, could stop fraudsters when they walk in the door. This is but one simple and commonsense solution to prevent the fleecing of the system and hard-working taxpayers.”

About the Author

Ian Smith is one of the co-founders of He has over 20 years of combined experience in media and government services, having worked at two government contracting firms and an online news and web development company prior to his current role at FedSmith.