ADMINISTRATION OF THE DISABILITY PROGRAM IN NEW YORK AND NEW JERSEY

FRIDAY, NOVEMBER 30, 1979

HOUSE OF REPRESENTATIVES,
SUBCOMMITTEE ON SOCIAL SECURITY,

COMMITTEE ON WAYS AND MEANS,

Washington, D.C.

The subcommittee met at 10 a.m., pursuant to notice, in room 1100, Longworth House Office Building, Hon. J. J. Pickle (chairman of the subcommittee) presiding.

[Press release announcing hearing follows:]

[Press release of Tuesday, Nov. 20, 1979]

CHAIRMAN J. J. PICKLE (D-TEXAS), SUBCOMMITTEE ON SOCIAL SECURITY, COMMITTEE ON WAYS AND MEANS, ANNOUNCES CONTINUATION OF OVERSIGHT HEARINGS ON THE ADMINISTRATION OF THE DISABILITY PROGRAM IN NEW YORK AND NEW JERSEY Honorable J. J. Pickle, Chairman of the Social Security Subcommittee, Committee on Ways and Means announced today that oversight hearings will be held on Friday, November 30, 1979, at 10:00 a.m. in the Main Committee Hearing Room, 1100 Longworth House Office Building, on the administration of the disability insurance program in the states of New York and New Jersey. State agencies under contract with the federal government make the initial determinations of disability in the adjudication process.

Almost two years ago hearings were held by the Social Security Subcommittee which developed evidence that the quality of administration in these jurisdictions was substantially below that of the nation as a whole. This situation appears to be continuing.

A major study has just been completed by the Public Executive Project of the State University of New York (SUNY-Albany), which raises questions about the highly centralized nature of the New York Disability Determination agency and other elements of its administration of the program. New Jersey consistently has had one of the lowest decision (SPAR) accuracy rates in the country. The GAO has recently completed a report which indicates that through an "indirect cost" mechanism New York has been paid disability trust fund monies for services it has not rendered to the disability program.

On July 27, 1979, the Subcommittee held hearings on this matter and the Commissioner of Social Security was asked to advise the Subcommittee on what can be done about this situation. The purpose of the November 30 hearing is to hear from officials from New York and New Jersey and representatives of disability examiners in these states on these issues.

Mr. PICKLE. The Chair will ask the subcommittee to come to order, and we will proceed with our hearing this morning.

On July 27, we invited the Commissioner of Social Security, Mr. Stanford Ross, and Regional Commissioner Joe Kelly, from the New York region, to testify on how they were supervising the operation of the New York and New Jersey disability determination agencies.

This hearing is a followup of the subcommittee staff activity going back to the fall of 1977 and a hearing we also conducted in

(1)

February 1978 on quality assurance. It was brought out at this time that, in terms of quality of the adjudication of disability cases as it is measured by the Social Security Administration, these two States have been far below program norms. Unfortunately, this situation has continued over the past 2 years with no appreciable improvements shown in performance.

The latest statistics show New Jersey and New York ranking 50th and 51st in quality, respectively. Moreover, as quality had been emphasized in these States, processing time has lengthened much more than has been the case for the Nation as a whole.

More recently, there are allegations that attempts to expedite case production are being carried out at the expense of quality in the determination of disability.

The purpose of this hearing is to give the States the opportunity to put in perspective their performance as shown in the material set out in our July hearings. In those hearings we also heard from the representatives of the public executive project of the State University of New York-that is in Albany-who were just finishing a comprehensive study of the structure and administration of the New York agencies. This report, which, among other things, called for decentralization of the disability agency, is printed in our July hearings. I am sure the New York parent agency will wish to comment on the findings of this report.

Also printed in the record is a GAO report which deals with the question of reimbursement to the parent agency for what are known as indirect costs. The GAO alleges that New York has charged the disability trust fund for costs in an inappropriate manner and even for services which have not been rendered at all. Incidentally, New Jersey was not one of the States examined by the GAO.

Finally, we may question the people here today on a late breaking development, namely, the recent allocation of funds by the Social Security Administration to the States for this fiscal year to carry out the crucial functions of making disability determination. Some State agencies have argued that the State/Federal disability relationship is deficient in that the Federal Government sets performance standards and then does not give the States adequate resources to make them obtainable.

This hearing this morning, then, is a continuation of our hearing in July, in which we specifically have invited representatives from the States of New York and New Jersey to respond or make such statements as they might want to make in connection with these allegations and observations.

Our first witness scheduled this morning, I believe, is Eleanor A. Sochocki, assistant commissioner, New York State Department of Social Services, and I understand she will be accompanied by Mr. Sidney Houben, New York State Bureau of Disability Determination.

If you would both come to the witness table, we would be glad to hear you.

Ms. Sochocki, you may proceed when you are ready. We are glad to have you here this morning.

STATEMENT OF ELEANOR A. SOCHOCKI, ASSISTANT COMMISSIONER, DIVISION OF INCOME MAINTENANCE, NEW YORK STATE DEPARTMENT OF SOCIAL SERVICES, ACCOMPANIED BY SIDNEY HOUBEN, DIRECTOR, BUREAU OF DISABILITY DETERMINATIONS

Ms. SOCHOCKI. Thank you. I am Eleanor Sochocki, assistant commissioner in the New York State Department of Social Services. I am representing Commissioner Barbara Blum, who was unable to arrange her schedule to be here today. With me is Mr. Sidney Houben, director of the State's Bureau of Disability Determinations.

New York State representatives attended your July hearing, and we appreciate this opportunity to present the State's perspective on some of the concerns expressed and the issues raised at that time. The State's responsibilities in the disability determinations process are carried out by our Bureau of Disability Determinations, which is a component of the department's Division of Income Maintenance and is located in New York City.

In size, the bureau's workload compares only with California's. During September 1979, New York State received slightly over 22,000 cases; California received slightly more than 23,000. The next ranking State was Texas, which received about half as many-about 11,000.

Processing this workload requires a staff of approximately 1,000 persons. Actually, for the 1979 Federal fiscal year, the Social Security Administration provided initial budget approval for 1,034 manyears, which was gradually reduced to about 1,001 by the end of the fiscal year. California's authorized man-years for fiscal year 1979 were 1,152.

Commissioner Ross, in his July testimony before this subcommittee, stated that one of the major operational problems was timely and accurate determinations. We also recognize the need for improvements in the quality of the decisions and reductions in the time required to make appropriate decisions and a high priority has been assigned to bringing this about.

Over the past 6 months, the bureau has made noticeable progress. The pending caseload was reduced from 41,118 in mid-May to 36,793 in mid-November, an 11 percent reduction, and the percentage of claims which were pending for more than 70 days was reduced from 11.1 percent to 9.2 percent for title II and from a 13.2 percent to 10.8 percent for title XVI.

For May 1979, the mean processing time for initial title II claims was 58.2 days, which was reduced to 52.9 days by October. Title XVI initial claims processing was reduced from 68.6 days to 59.7 days during the same period.

These accomplishments, however, have been accompanied by a reduced rate of accuracy. The recently reported SPAR accuracy rates for October are 79.4 percent for title II and 81.4 percent for title XVI. In May, the rates were 85.4 and 87.3, respectively.

I would like to mention that accuracy rates are apt to vary widely from month to month. Quarterly rates average out these fluctuations and more appropriately reflect the State's performance. For the July-September 1979 quarter, New York State's rates were 82 percent for title II and 87.2 percent for title XVI.

Even though it is impossible to identify all the factors which contribute to lower accuracy rates or to quantify their impact, these trends clearly highlight the need for additional corrective measures. We are proceeding with a number of activities which over time should result in more timely and accurate decisions. There are factors which impact our operations which are beyond our control, however. The size of our organization is unique; the recruitment, training, and retention of qualified and competent staff is an ongoing problem and activity. For example, during fiscal year 1979, we lost 35 percent of our skilled examiners. New examiners require at least 1 year of formal training and job experience to function at a comparable level. As a result, there is an everpresent lag in essential resources.

For the past several months, we have spent substantial effort in planning for the physical relocation of the bureau from its present location in the World Trade Center. We expect to accomplish this with a minimum of disruption, but we realize that there will be an initial negative impact on both quality and quantity of production. I would like to take a moment to speak about the move. In New York State, acquisition of space for housing State agencies is handled by the Office of General Services. Individual agencies may have choices of acceptable locations, but the initial finding, lease negotiations, moving-related activities, such as renovations, telephone services, and movers, are handled by OGS.

Our department is only one of many being serviced. It is our understanding that the space occupied in World Trade Center was not under lease to the State. When the Port Authority, which operates the Trade Center, advised the State that the space occupied by the Bureau had to be vacated, there was no alternative but to seek adequate quarters elsewhere.

Finding 160,000 square feet of desirable office space, negotiating a rental agreement satisfactory to the landlord, New York State and the Federal regional office, which oversees our activities, took almost a year, but it is now an accomplished fact. We will move into quarters at 110-130 Williams Street in downtown Manhattan on January 18. The move will be executed over a weekend. Bureau activities will be suspended late on Friday and business will be conducted at the new location on Monday.

In addition to a general disorientation, which results from a different physical environment, we expect some confusion from our staff and our clients resulting from the utilization of a new telephone system at the new location. The adjustment period should be short.

Our recognition of the need for improvements is reflected in the initiation of a management review, which was discussed at the July hearing. You now have the final report of the public executive project. We have not made decisions with respect to all of the recommendations which the study group presented, but we are prepared at this time to move forward in selected areas.

We are considering elevation of the bureau to a division within the department. Under this structure we expect that the bureau's manager would be a deputy commissioner responsible to the department head. Consideration is also being given to locating a core management staff in Albany.