S O C I A L SECURITY:
REEXAMINING ELIGIBILITY FOR DISABILITY BENEFITS
I S S U E B R I E F NUMBER I B 8 2 0 7 8
U P D A T E D 05/25/84
Education and Public Weifare Division
T H E L I B R A R Y OF C O N G R E S S
CONGRESSIONAL RESEARCH SERVICE
MAJOR I S S U E S S Y S T E M
D A T E O R I G I N A T E D 06/02/82
FOR A D D I T I O N A L I N F O R M A T I O N C A L L 2 8 7 - 5 7 0 0
Since 1 9 8 1 , many social security disability recipients lost their benefits
because of a major effort by the Social Security Administration
reexamine their eligibility.
This increase in reexaminations was required by
amendments enacted in 1980 to deal with a n earlier decline in eligibility
The Reagan Administration implemented the new requirement broadly
in March 1981, ahead of schedule, after GAO reported that possibly
existing disability beneficiaries were ineligible.
Complaints that many of the terminations were unfair led to legislation in
December 1982, P.L. 97-455, to soften the impact of the new process.
Administration also took a number of steps to ease the reviews. However, the
issue was reignited early in 1983 and the House Committee o n Ways and Means
recommended that recipients not be terminated unless it can be shown that
they medically improved, that a moratorium be imposed o n reviewing persons
with mental impairments, and further softening measures.
were included in H.R. 4170, the Tax Reform Act of 1983, which the House
failed to take up before it adjourned for the year.
Similar measures brought
up in the Senate just before it adjourned were tabled.
However, in March
1984, the Ways and Means Committee again reported out the disability
provisions, but this time by themselves, a s H.R. 3755, and the House passed
The Senate Finance Committee reported out related measures as part of
S. 476, which the Senate passed on May 22, 1984. Conferees for the House and
Senate are expected to meet after the Memorial Day recess.
The Administration earlier had announced suspension of most disability
reexaminations until Congress completed its
BACKGROUND AND POLICY ANALYSIS
CURRENT PROGRAM CHARACTERISTICS
The DI program is the Nation's primary source of income replacement for
workers (and their families) who are unable to work
due to a disabling
In June 1983, there were 3.9
million D I beneficiaries
million o f whom were disabled workers).
The average benefit for single
in January 1984; $871 per month
disabled workers was $440 a month
disabled workers with dependents.
FY84 expenditures are estimated
approximately $18 billion.
About 300,000 disabled workers were awarded
benefits in 1982.
(Almost 350,000 additional awards were made to their
Among workers awarded benefits in 1975, the average a g e was
55.6, 44% had been employed in blue-collar occupations requiring some type of
physical labor, 60% had less than a high school education.
New award data
for 1977 shows that 31% of new disabled worker beneficiaries were women, and
14% were black.
The leading causes of disability among beneficiaries coming
on to the rolls in 1 9 7 7 were:
diseases of the circulatory system, 30%;
diseases of the musculoskeletal system, 19%; mental disorders, 12.5%;
There were approximately 2.3 million Supplemental Security Income
in July 1983
disability recipients who received an average of $244 a month
($254 for the blind).
In FY82, approximately $6 billion was paid out to
disabled persons covered by SSI program.
To be eligible for DI benefits, a worker must be both
To be fully insured for life, a worker must have
credit for working 40 quarters in covered employment.
If a person has not
worked 40 quarters, he is still fully insured if he has a t least one quarter
of coverage for each year after 1 9 5 0 , or if later, after the year in which he
became 21. To be disability insured, the worker must have 20 quarters of
coverage in the 4 0 quarters preceding the onset of disability
exceptions for younger workers and the blind).
The worker must be unable to
do any substantive work which exists in the national economy
( t a k i n g ' into
consideration age, education, and work experience) because of the disability,
and the disabling condition must be expected to last at least 1 2 months or to
end in death.
There is a 5-month waiting period before benefits begin.
Medicare benefits are available 2 4 months after disability benefits begin.
The SSI program
uses the same criteria for determining disability;
however, the quarters of coverage requirements do not apply.
individual must be able to meet a "means test."
SSI disability recipients do
not have a 5-month waiting period.
DI benefits are based on a worker's average monthly earnings prior to the
onset of the disability, which are indexed to reflect national wage growth
(most of a worker's career earnings are taken into account in computing the
The benefits are adjusted annually for increases in the cost of
Benefits are also provided to dependents, although there are limits
A worker who earns more than
on the maximum amount- a family can receive.
$300 per month is considered to be engaging in substantial gainful activity
and therefore no longer eligible for any DI benefits, although some "trial"
work is permitted.
DI benefits may be offset if a n individual
simultaneously receiving workers compensation benefits or certain other
public disability benefits.
In the SSI program, there are flat Federal benefit amounts payable of
$304/month for a single person and $456/month for a couple
These amounts may be reduced if the individual or couple has
THE CURRENT DISABILITY DETERMINATION PROCESS
The disability determination process, which is generally the same for both
DI and SSI disability and blindness claims, can involve decisions a t five or
an initial decision, three appeal levels within SSA,
more distinct levels
and then the Federal judicial system. The procedures of each decision level
are discussed briefly as follows.
1. Initial Determination by SSA District Offices and State Agencies
Applications for DI and SSI disability benefits are filed by claimants in
one of SSA'S district offices.
The district offices accept applications,
obtain the names of the physicians, hospitals or clinics that have treated
the claimants, and make all the nonmedical eligibility determinations based
On Such factors a s insured status, work activity, and for SSI claims, income
If the claim is denied because the applicant does not meet
these nonmedical requirements, a formal notice is sent.
A claimant's application (or file in the case of an existing beneficiary),
any medical records he or she may have provided, lists of sources of medical
evidence, and other background
information obtained during the district
Office interview are forwarded to the disability determination service
in the individual's home state. The DDSs are State agencies and a r e usually
components of State vocational rehabilitation or education agencies.
total operating costs are paid by SSA with social security trust fund money.
The State agency disability examiner may request more detailed medical
reports from physicians who have treated the claimant/beneficiary.
medical reports from physicians are expected to consist primarily of clinical
and laboratory findings. However, if sufficient medical
be obtained in this manner, the disability examiner may ask the individual to
be seen by a private physician selected by the State agency. The disability
examiner may also seek more
to the claimant's
education and work experience from the claimant.
After the required evidence has been obtained, a two-person
team consisting of a physician and the disability examiner makes a decision
on the claim.
The physician determines from the medical evidence the extent
to which physical or mental limitations exist and whether the impairment
meets or equals the medical listings published in regulations.
listings describe specific diagnostic signs,
laboratory findings for various common impairments which are considered
severe enough to prevent a person ordinarily from doing any substantial
gainful work on a n ongoing basis.
If the claimant is not found to be
disabled on the basis of the medical
criteria in the
determination is made of the claimant's physical and mental ability to
perform various types of work-related functions.
The disability examiner determines whether, with those limitations, the
claimant can or cannot perform substantial gainful activity in jobs that
exist in the national economy, based on the claimant's age education, and
Disability decisions are then issued a s Federal decisions
and the claimant is notified.
A similar process
is followed for existing
beneficiaries undergoing a continuing disability review.
If the claim i s
denied, the formal notice indicates why and advises the applicant of his or
her appeal rights.
If the decision is to terminate benefits, the disability
beneficiary receives benefits for the month that the disability
ceased a n 8
for two additional months (or longer if the individual files an appeal).
2. Reconsideration by State Agencies
Individuals who receive a n unfavorable initial decision have a right to
have their cases reconsidered, but must file for reconsideration within
days after receiving notice of the denial or termination of benefits.
reconsideration process is similar to the initial process except that, after
the social security district office updates
different State agency team reviews the case.
It should be noted that the individual i s not seen by the State disability
examiners a t either of these first two stages of the process
e . ,
"initial" determination or the "reconsiderationw).
Where a beneficiary is
being reviewed, however, local social security district office personnel will
conduct a face-to-face interview with the individual to ascertain that a l l
the necessary information has been obtained to perform the review.
of face-to-face contact with the disability examiner has been the subject of
considerable criticism, and Congress responded to it late in 1982 by enacting
a provision requiring that people being terminated be given an opportunity to
present their case to a disability examiner,
"reconsideration" stage of the process.
The new law requires SSA to make
such hearings available beginning in January 1984.
3. Hearing before an Administrative Law Judge
If the reconsideration team upholds the initial denial of benefits, the
individual may request a formal hearing before an administrative
A request for a
(ALJ) in the SSA Off ice of Hearings and Appeals
hearing must be filed within 60 days after receiving notice of the
These hearing offices are located throughout
The ALJ is responsible for obtaining all relevant evidence for the case,
holding a face-to-face nonadversary hearing with the individual, and making a
decision. The ALJ may request the appearance of medical and vocational
experts at the hearing and can require the individual to undergo a
consultative medical examination.
The individual may
evidence, produce witnesses, and be represented by legal counsel or lay
There is no charge for requesting a hearing.
egisl la ti on enacted in 1982 allowed persons terminated before October 1983
to choose to continue to receive benefits while they appealed.
could continue until the hearing stage, but a n adverse hearing decision could
result in their.having to repay the benefits.
Temporary legislation enacted early in October 1983 extended
It is now expired; however, the Administration
provision until Dec. 7, 1983.
announced on Apr. 1 3 , 1984, that no one in the appeals pipeline would be
terminated until Congress completed action on the pending
4. Appeals Council Review
Following a denial of benefits by a n ALJ, the affected
within 60 days after receiving notice, request SSA's Appeals
review the decision.
The Appeals Council i s a 15-member body
It may uphold or change the ALJ's
action or it may
remand the case to a n ALJ for further consideration.
It may also review any
ALJ action on its own motion within 60 days after the date of the ALJ's
The Appeals Council review is a reexamination of the case a s it was
developed through the hearing stage.
New evidence is not obtained and the
individual does not usually make a personal appearance.
5. Federal District Court
The Appeals Council review is the claimant's last recourse within the
Social Security Administration..
If the Council affirms the denial of
benefits or refuses to review the case, further appeal may be made through
the Federal district courts.
THE CURRENT DISABILITY CASE REVIEW PROCESS
Review of State Agency Allowances
The Disability Amendments of 1980 requires SSA to review a certain
proportion of favorable decisions made by the State agencies before benefit
This pre-effectuation review, i n which incorrect allowances
are reversed prior to payment of any benefits, is intended to promote the
uniformity and accuracy of favorable disability decisions.
applies to favorable decisions made by the State agencies on initial claims
and continuing disability reviews.
SSA began the new procedure in October 1980 and was required to review 35%
of all favorable State agency decisions in FY82 and 65% thereafter.
have been targeted on those types of cases determined from available data to
be most likely in error.
Own Motion Review of ALJ Decisions
On Oct. 1 , 1981, SSA implemented a program of own-motion
this review the agency, a t its own initiative, examines decisions rendered by
The review is conducted by
The Council may
affirm or reverse the decision or remand the case to a n ALJ
Continuing Disability Reviews
The State agency not only has the function of deciding who comes on the
disability rolls, it also must make determinations as to whether individuals
stay on the rolls.
When a n existing case is selected for review, the State agency notifies
the beneficiary and asks for information about his current condition and
whether he recently received medical
treatment and, if s o , where.
previously mentioned, this information may be obtained through a n interview
a t the social security district office.
If the current medical evidence is
not detailed enough, or if the beneficiary
has had no recent medical
treatment, the State disability
examiner arranges for a
examination by a physician.
The disability examiner then evaluates the medical evidence and determines
whether the beneficiary Continues to be eligible.
Those who a r e found to be
no longer disabled are informed by letter and advised that if they disagree
they have additional time to submit further evidence.
If the State agency, after looking at any further evidence, still finds
that the beneficiary does not meet the disability criteria, the beneficiary
i s notified and informed that he may appeal
reconsideration within 6 0 days.
THE CONTINUING DISABILITY REVIEW PROBLEM
Acceleration of Eligibility Reviews
A GAO report issued in January of 1981 estimated that as many as 20%, or
584,000, of DI beneficiaries were either ineligible or receiving too large a
(A later report from SSA indicated it could be a s high a s 30%.)
a result, the Reagan Administration accelerated a new review procedure that
was mandated by legislation enacted in 1980.
That legislation called for
tightening the initial claims process with a n eye to weeding out ineligibles
a t the outset and continuously investigating DI beneficiaries to ascertain
whether they remain eligible.
There was considerable strain put on SSA when it was made responsible for
processing black lung claims in the early 1970s and then, shortly thereafter,
when it took over the State disability welfare rolls upon implementation of
the SSI program.
Under the conditions imposed by these heavy workloads, many
claims may.not have been well enough developed to assure that the individuals
involved were, in fact, eligible for DI benefits.
In addition, budget
pressure within the Administration on staff resources in the early 1970s led
to a sharp curtailment of Federal verifications of the disability decisions
made by State agencies. Further, monitoring of the eligibility of existing
DI beneficiaries took second place to public and congressional pressure to
process initial claims as quickly as possible.
Through the 1970s, the number of continuing disability
conducted annually stayed relatively static. (about 150,000 to 200,000 cases
per year), while the number of disabled workers joining the DI program
This situation raised concerns in Congress that SSA might not
be putting enough effort into assuring that only those people who could meet
the conditions for eligibility continued to receive benefits.
This led to a
provision in the 1980 Disability Amendments, which, a s mentioned
required that unless a DI beneficiary had been diagnosed a s permanently
disabled, he had to be reexamined a t least every 3 years.
The new law was to go into effect beginning in January 1982.
did not give SSA new administrative authority.
Since the inception of the DI
program, SSA had the responsibility of
eligibility of existing beneficiaries.
The 1980 provision merely established
a "minimum review1' requirement.
Responding to the GAO report, the Reagan Administration decided
accelerate the new review requirement as part of its FY82 budget initiatives,
and in March 1981 started reviewing about 30,000 additional DI cases per
month, beyond the then "normal" review workload.
(The SSI disabled were not
subjected to the new review effort, except for those who were simultaneously
entitled to DI benefits.
Their exclusion was due primarily
The following table shows the changes in the volume of reviews
that the new initiative brought about.
Number of Continuing Disability Reviews
(DI and SSI State Agency Decisions)
Committee print 98-93.
Committee, Sept. 1983.
FY83 and F Y 8 4 information from SSA.
Congressional concerns subsequently arose from reports that the expanded
review effort was resulting in terminations of many beneficiaries, without
much warning, and allegedly in some instances without much evidence that the
ineividual was not disabled. The rate of termination from these reviews
initially was running at close to 50%.
It then hovered in the 45% range for
more than a year, and dropped below 40% in the last half of 1983 a s a' result
of softening actions taken internally by the Administration.
From March 1981 through December 1983, 1,297,000 persons had gone through
the new review process, and 476,000 of them had been terminated a t the
initial stage. Many, but not all, appealed and had their initial decision
reversed by an ALJ; others are still in the appeals pipeline.
Many of these
terminated beneficiaries were on the rolls for a number of years and had not
been reexamined until the intensified review effort began.
found their continued eligibility in question.
complained that they
were still disabled and were wrongfully terminated.
Adding to these
complaints, substantial delays arose in the SSA appeals process because of
the large number of persons filing appeals. There were some 173,000 cases
pending before ALJs a t the end of September 1983 (in contrast to the 110,000
case backlog at the end of September 1980).
Some individuals have been
waiting from 6 to 1 2 months to get a hearing, a t which an ALJ ultimately may
decide that they were entitled to benefits all along.
During the months of
February 1982 through September 1983, ALJs heard 152,000 appeals, reversing
the earlier termination decision in 92,000 of them (61%).
Judicial and State-Level Reactions
Concern also was shown for the review effort in the Federal court system
and at the State level, where disability reviews are actually conducted.
Approximately 30 States have, either on their own or by court order, stopped
making terminations or begun using more liberal termination procedures.
Consequently, the DI program -- intended to operate as a national program
with uniform policies and procedures -- is now operating de facto under
somewhat varying State or regional policies.
Impact of Judicial Decisions
As terminations mounted, a significant number of individuals appealed
their cases to the Federal court system.
The subsequent court decisions have
sometimes been at odds with SSA policy, and have resulted in termination
policies that vary from one region of the country to another.
Under present SSA policies, disability benefits a r e
terminated where current eligibility requirements are not met; no medical
improvement needs to be shown.
The ninth circuit court in two opinions
Finnegan v. Mathews and Patti v. Schweiker
held that in SSI disability
cases SSA must show improvement before benefits can be terminated.
1983, following the precedent in the Patti decision, a Federal district
Schweiker, in a statewide
court, i n Morrison, D o e , and Decker et & v.
(Washington) case, enjoined SSA from terminating social security or SSI
benefits without applying a medical
another decision rendered by the second circuit court on Oct. 1 1 , 1983, the
judge upheld SSA's current policy of terminating benefits if the individual
cannot meet the current disability criteria, regardless of whether medical
improvement can be shown (Wheeler v. Heckler).
There would now appear a
conflict among the circuit courts about S S A 9 s interpretation of the law.
In a class action suit, a district court in
Standards for Mentally Ill:
Mental Health Association of Minnesota v.
Schweiker found that SSA and the
State agencies were following an improper standard in evaluating whether
younger workers with mental impairments are disabled.
The court ordered SSA
to (1) cease using the improper standard; (2) review all cases i n the region
where benefits were not awarded or were stopped after Mar. 1 , 1981; and
pay interim benefits in all cases until they were evaluated using the proper
Under the Federal judicial system, decisions of a
Circuit Court of Appeals are considered the "law of the circuitn and
constitute binding case law on all district Courts within the circuit.
However, SSA does not follow circuit court decisions with which it disagrees,
either nationwide or within the circuit of the ruling (as is generally the
policy for other Federal agencies).
While the agency does obey the court's
ruling a s it pertains to the individual(s1
in the particular case, the
interpretation of law by the court is not considered binding either for the
State agencies or for Federal social security offices.
SSA also instructs
its ALJs to continue to apply existing agency policy to other cases rather
than the court's ruling. Generally, if two circuits rule differently on the
same issue, the Supreme court will settle the dispute.
Federal judges in both the eighth and ninth circuits criticized the
Secretary of HHS for using this policy of nonacquiescence.
In the Lopez v.
Heckler case, the Ninth Circuit Court of Appeals first refused to issue a
stay (requested by the Administration) of a lower court's ruling that the
Secretary temporarily had to follow the "medical improvementw principles
established in the Finneqan and Patti decisions (described above) and provide
interim payments to the affected individuals.
Supreme Court Justice
Rehnquist subsequently granted a partial stay (later sustained narrowly by
allowing SSA to avoid making the interim payments
the full Supreme Court)
the ninth circuit court largely ruled against the Administration on the
question of the interim payments.
The district Court has yet to decide on
the substance of the non-acquiescence issue.
Actions Taken by the States
Concern about the review process prompted some State officials to take
their own action.
On May 9 , 1983, the Massachusetts Disability Determination
Service, in response to a directive from Governor Dukakis, instituted new
procedures for reviewing cases incorporating their interpretation (not SSAs)
of the evidentiary requirements set forth in Miranda v.
The Secretary of
has been found
eligible, disability benefits may not be terminated unless the individual's
condition has substantially improved or unless the review shows that the
condition is not a s serious as once supposed.
Arkansas, Kansas, and West
Virginia have similarly adopted more liberal termination policies on their
On July 22, 1983, the Social Services Commissioner of New York, on his own
initiative, temporarily suspended terminating
pending establishment of a new medical improvement standard for terminating
(This, however now may be in conflict with the
second circuit Court's decision in the Wheeler case previously mentioned).
Besides a moratorium on cessations, New York State joined in a lawsuit
challenging the Federal standards used to determine eligibility of the
mentally impaired. Alabama, Maryland, New Jersey, North Carolina, Ohio,
Pennsylvania, Virginia, and West Virginia a l s o , on their o w n , imposed a
moratorium on terminations. Still other States, reacting to Court decisions
to loosen up on terminations, have now or a t one time imposed temporary or
Colorado, Hawaii,'Idaho, Michigan, Montana, Nevada, Oregon, and Washington.
LEGISLATIVE ACTION IN THE 97TH CONGRESS:
House and Senate Action
In September 1982, the Senate Finance Committee recommended a number of
measures to soften the impact of the termination procedures.
reported out these measures a s part of a House-passed bill altering certain
taxes paid to the Virgin Islands (H.R. 7093).
The Senate approved its
version of the bill on Dec. 3 , 1982, by a 70-4 vote and sent it back to the
The House Ways and Means Committee earlier in the year had approved
similar softening measures as part of H.R.
6 1 8 1 , originally introduced a s
However, it was never considered
H.R. 5700 (see H-Rept. 97-588, May 1982).
by the full House because of controversy over a couple of its features -features which would have imposed agency-wide decision-making standards and
certain evidence-gathering constraints on the ALJs a t the hearing stage.
Although that bill was never taken up by the full House, when the Senate sent
the Virgin Islands tax bill (H.R. 7093) back to the House in December 1982
with disability provisions attached, the House took the opportunity to revive
several provisions of the original Ways and Means Committee bill.
House approved a modified H.R. 7093 by unanimous consent on Dec. 1 4 , 1982,
and sent it back to the Senate with the additional amendments.
Conference Report and Final Passage
At the request of the Senate, a House-Senate
conference committee was
organized to work out a compromise agreement on H.R. 7093. On Dec. 2 1 , 1982,
the conference committee filed a report which was approved by both the House
(259-0) and Senate
(no recorded vote)
on that d a y , just before the
adjournment of the 97th Congress.
The final legislation contained the
following social security provisions (in addition to the provision reducing
the rate of certain taxes paid to the Virgin Islands):
1. Continuation of DI benefits for terminated beneficiaries until a
decision on the appeal has been reached by an administrative law judge, but
not beyond June 1 9 8 4 and not for terminations occurring after Sept. 3 0 , J983.
Beneficiaries whose appeals were pending a t the time of enactment a s well a s
those whose benefits were terminated before Oct. 1 , 1 9 8 3 , were to be eligible
to elect the special benefits paid during appeal. These benefits would be
subject to recoupment as overpayments if the termination decision were
ultimately upheld on appeal.
(It should be noted that this provision was
extended to Dec. 7 , 1983, by P.L. 98-118, but has since expired.)
Authority for the Secretary of Health and Human Services to waive, on
the statutory requirement
(from 1980 disability
amendments) that all non-permanently disabled beneficiaries be subject to a
continuing disability review at least once every 3 years.
granted only when the Secretary found that the State agency had made a good
faith effort to process reviews in a timely fashion.
a State-by-State basis,
A requirement that no later than Jan.. 1 , 1984 the State agencies o r
SSA conduct an evidentiary hearing, with a n opportunity for an in-person
appearance by the terminated beneficiary, a s a part of the reconsideration
level of appeal in all DI benefit termination cases.
4. A requirement that the Secretary of Health and Human Services inform
all terminated beneficiaries
of the procedures used
including the opportunities to introduce evidence and to be represented by a n
A requirement that the Secretary of Health and Human Services make a
semi-annual report to Congress on the number of continuing disability reviews
conducted and the disposition of the cases o n appeal.
6. A modification of the government pension offset provision
either male or female spouses with pensions from non-covered government work
to be exempt from the government pension offset if they were dependent on
their social security-covered spouses for a t least one-half of their support
and if their government pensions became payable during
1982, through June 30, 1983.
this modification, the government
pension offset would have applied to all female government-worker spouses who
became eligible for government pensions a s of Dec.
1 , 1982, or later
already was in force for most men a t that point).
It should be noted that
this offset provision was further amended in April 1983 a s part of the Social
Security Amendments of 1983 (P.L. 98-21), liberalizing the Offset so that
only two-thirds of a government pension can be used
to ' m a k e the offset
(instead of the full pension).
This provision was made available only to
those who become eligible for a government pension after June 1983.
President Reagan signed the bill into l a w , P.L.
97-455, on Jan. 1 2 , 1983.
LEGISLATIVE ACTION IN THE 98TH CONGRESS
Action in the First Session
Concerns about the eligibility reviews were ignited again early in 1983
largely because of a GAO report that terminations of many mentally
beneficiaries have been made under faulty guidelines
guidelines which have
imposed a much tougher set of eligibility rules upon the mentally
than persons with other impairments. GAO stated in testimony before the
Senate Special Committee on Aging (in.Apri1 1983) that the mentally impaired
were more heavily reviewed than other segments of the beneficiary population,
and that their initial terminations were being reversed more readily upon
appeal a t the hearing stage.
They also stated that the State agencies were
often unable to obtain adequate psychiatric consultant services to assist i n
SSA countered that disability determinations for those with mental
impairments have a.lways been much more difficult to make than for persons
other types of disabilities.
They added that the problems GAO
the policy guidance given to the State agencies was
corrected and new guidance disseminated, and that they were working with
States to obtain more psychiatric support services.
Nonetheless, the issue reignited concern about the expanded eligibility
review process i n general, and a s well about the whole process of making
disability determinations by SSA and the State agencies.
Responding to the concerns raised about the terminations of the mentally
impaired, the Senate adopted an amendment by Senator Heinz on June 1 5 , 1983,
to a supplemental appropriations bill (H.R. 30691, which would have suspended
continuing eligibility reviews of the mentally impaired until the Secretary
of Health and Human Services revised the regulatory criteria for evaluating
The Secretary would have been required to revise the
criteria within 6 months, with the assistance of a panel of experts in the
field of mental health.
The amendment also required the Secretary to make a
determination of disability in a mental impairment case only when the case
has been evaluated by a qualified psychiatrist or psychologist.
measure was in the House version of the Supplemental Appropriations bill, and
when it was taken up by the House-Senate conferees it was dropped because
a procedural conflict with House rules that preclude substantive alterations
of program legislation through appropriations bills.
While this measure was dropped, legislative interest was building in the
House, beginning with hearings held by both the Social Security Subcommittee
of the Ways and Means Committee and the Select Committee on Aging.
sessions on a draft bill were then conducted in July, August and September
1983, with the Ways and Means Committee reaching final agreement on a n
extensive package of changes on Sept. 27, 1983.
These measures originally
were contained in H.R.
(Pickle et al.)
The Committee subsequently
incorporated them into an omnibus tax bill, H.R.
numerous other changes in the tax l a w , Medicare, and trade adjustment
However, the recommended rule under which the House would have
voted on the tax bill was rejected on Nov.
1 7 , 1983, leaving the bill
(including its disability provisions) in limbo a t the time of congressional
adjournment for the year.
Similar, but less costly, provisions were also presented to the Senate
Nov. 1 7 , 1983, when Senators Cohen and Levin et al. attempted to attach
amendment to H.R. 3959, another supplemental appropriations bill.
Senate action, however, was blocked by a tabling
which was accepted by a vote 49-46.
The key issue with
the House disability package and the Cohen-Levin
amendment, in addition to their cost, has been over the question of adopting
a "medical improvement" standard. Advocates argue that it is needed to bring
order to the system and relief from the harsh impact of the terminations.
Critics argue that it would create a double standard between applicants and
existing beneficiaries as well a s allow ineligible recipients to remain on
P.L. 98-118 and H.R. 3391:
Earlier in the fall, Congress passed a 67-day
extension of the provision enacted in 1982, allowing terminated benef.iciaries
to continue to receive benefits while they appealed their termination
part of H.R. 3929 dealing with supplemental unemployment insurance benefits,
The 1982 provision expired on Sept.
extension allowed persons terminated before Dec. 7, 1983, to receive benefits
while they appeal.
The additional months of benefits would not be available
to persons terminated after that point.
Following the action on Nov.
1983, which blocked consideration of the Ways and Means disability provisions
and the Cohen/Levin amendment, Senator Dole et al.
offered on Nov.
1 8 an
amendment to a worker training bill, H.R. 3391, which would have extended the
provision, allowing a beneficiary terminated before June 7 , 1984, to receive
benefits while appealing, a s well as extending a couple of SSI disability
provisions due to expire o n Dec. 31, 1983.
It passed the Senate by a vote of
8 0 to 0; however, when it was sent back to the House later that day, it had
be considered under a special rule requiring unanimous consent.
Dannemeyer objected to bringing it up under that rule, and the House failed
to consider the Senate-passed measure before adjourning for the year.
However, early in 1984, the House passed the SSI portion of H.R.
deleted the DI measure to continue benefits upon appeal.
Action i n the Current Session
On Mar. 1 4 , 1984, the House Ways and Means Committee separated the
disability provisions from the tax bill, and reported them out, this time by
themselves, in H.R. 3755.
The House subsequently passed
them on Mar.
1984, by a vote of 410-1.
On May 1 8 , 1984, the Senate Committee on Finance reported out related
measures a s contained in S. 4 7 6 , introduced by Senators Cohen and Levin et
The Senate then
al., with a number of modifications made by the Committee.
passed them on May 22, 1 9 8 4 , by a vote of 96-0. House and Senate conferees
are expected to meet after the Memorial Day recess.
The following side-by-side provides a comparison of the
contained in the House-and Senate-passed bills.
Provides permanent authority for
continued benefit payments until
a hearing before an ALJ in cases
where a termination of benefits
for medical reasons is being
appealed (this authority expired
under current law on Dec. 7,
Similar, but with
authority expiring on
June 1 , 1986;
Provides for a delay of reviews
of all mental impairment
disabilities until regulations
stipulating new medical
listings for mental impairments
are published, which must be no
later than 9 months after
would include all cases upon
which a timely appeal was
pending after June 6 , 1983, and
the bill provides special
procedures for any new mental
impairment applications denied
during this period and for
those with mental disabilities
who had their benefits terminated after Mar. l, 1981;
Provides permanent authority that
benefit payments can be terminated
only if SSA can prove that the
individual's medical condition
improved, unless: the individual
is working at the substantial
gainful activity level, the
original determination was in
error or obtained by fraud, the
individual has benefited from
advances in medical technology
or vocational therapy, or new
evidence (including that arising
from new diagnostic techniques)
shows the impairment to be less
severe than originally thought;
When an explicit
finding is made that the
individual's condition has
not improved or that his
impairment has worsened,
benefits would be continued
unless one or another of the
exceptions specified in the
House bill applies. However,
where a finding that the
individual's condition is
the same or worse cannot be
reached, the continuing
eligibility decision would
be based on the individual's
condition at the time he is
reviewed. The provision
would expire 3 years after
the issuance of implementing
Requires that in cases of
multiple impairments, the
combined effect of all the
impairments must be considered in making disability
Provides for a face-to-face
hearing between the beneficiary and State agency
disability examiners in
potential termination cases
at the initial decision level;
also requires that demonstration projects be conducted in
at least five States on
similar face-to-face meetings
with new claimants who are
A report to Congress
would be required by Apr. 1 ,
Provides for demonstration
projects in five States which
would give beneficiaries
who are being reviewed an
opportunity to make a personal
appearance before an initial
determination of ineligibility
Requires that a psychiatrist or
psychologist must complete the
evaluations of individuals with
mental disabilities in unfavorable decisions;
The Secretary must make ''every
reasonable effortw to ensure
that a qualified psychiatrist
or psychologist completes
the medical or related
assessment of limitation
portions of unfavorable mental
Requires that all disability
decisionmakers within the
system (SSA and the States)
are bound only by policy Set
out i n regulation;
Similar, but more directly
targeted on policies which
impact on the standards of
eligibility for disability;
Requires SSA to apply Federal
circuit court decisions
uniformly in that circuit,
unless they are appealed;
Requires SSA to publish in
the Federal Register a
statement when it decides
whether or not to acquiesce
in decisions of U.S. Circuit
Courts of Appeal; also requires
that these decisions be
reported to Congress;
Provides for more flexible
reimbursement provisions to
providers of vocational
Provides for a study to be done
by the National Academy of
Sciences with a report to
Congress by Apr. 1 , 1985, on
using subjective evidence of
pain in the disability determination process;
Puts in law the current
regulatory policy on how
"paintt is to be evaluated
in disability determinations
until Dec. 31, 1 9 8 7 , while
a commission of medical and
other appropriate experts
studies the issue.
to Congress would be due by
No similar measure in House
Requires the Secretary of
HHS to federalize a State
disability agency within 6
months of finding that the
State is failing to follow
Federal laws and standards.
The provision would expire
Dec. 31, 1987;
No similar measure in House
Requires the Secretary of
HHS to reduce inflation
adjustments and adjustments
made to the benefit formula
for initial awards, if the
reserves in the DI trust
fund fall below 20%; Congress
must be notified by July 1
of the preceding year.
Both bills also reauthorize a provision allowing special benefits under
SSI and Medicaid to continue for certain impaired persons who have earnings
which would otherwise make them
(section 1619 of the Social
In addition, the Senate bill establishes new monitoring and
reporting requirements for persons acting as representative payees for social
security and SSI recipients.
It also increases the penalty
for misuse of
funds by a representative payee.
STRUCTURAL CHANGES MADE INTERNALLY BY THE ADMINISTRATION
On Dec. 9 , 1983, the Administration announced that it temporarily was
holding up sending out any termination notices dated Dec. 7, 1983, or later
in effect, creating a moratorium on disability reviews.
On Jan. 25, 1984, the Administration announced that it was opposed to the
disability legislation pend.ing before the Congress, specifically mentioning
the provisions of H.R.
It stated that the administrative and
legislative changes already put in place made other reforms unnecessary, and
pointed out that the "Very high cost" (possibly $6 billion over the first 5
years) of H.R. 4170 made it tlunacceptable*l
given that the "safety margins in
the OASDI trust funds are relatively
small.** The Administration also
announced that the temporary moratorium imposed on reviews in December 1983
has been lifted, effective for terminations in February 1984.
Mar. 24, 1983, the Washington Post reported that the Administration was on
the verge of announcing a new moratorium, to extend over a n 18-month period.
On Apr. 1 3 , 1984, the Administration announced an indefinite moratorium
reviews a s Well as suspending the terminations then in progress or in the
Earlier, the Administration made a large number of structural changes
the review process o n its own.
A first series of changes was announced
1982. A second series was announced in June 1983.
Among the actions taken in 1 9 8 2 were:
at the social security district office before the eligibility review takes
place to obtain directly from the beneficiary any additional medical
information; reducing the number of persons reviewed by
expansion of the
category "permanently disabled" to include additional kinds of impairments;
requiring State agencies to obtain all medical evidence from physicians,
hospitals, etc., for the 1 2 months prior to the review; requiring State
agencies to be more complete and specific in their written
why beneficiaries are found not to be disabled; reexamining the process for
evaluating mental disorders, including testing the
consultative examinations in cases of psychiatric impairments; and reducing
the number of reviews conducted i n some States.
In response to renewed concerns about the review process raised early in
1983, SSA, on June 7 , 1983, announced additional measures.
included: exempting 200,000 more individuals from the reviews, bringing the
total exempted to more than 1 million; exempting about two-thirds, or
135,000, of the mental impairment cases from the reviews pending consultation
with outside professionals on revisions to standards and procedures now in
use; and moving to random selection of cases for State review
focusing on cases where recovery was most likely),
thereby lowering the
number of cases terminated a t the State agency level.
Early in 1983, the Administration estimated that 640,000 cases would be
reviewed in FY83 and 627,000 in FY84.
As a result of the June 1983 actions,
the estimates made early in the year were reduced by 130,000 cases in FY83
and 141,000 in FY84.
In this regard, the social security actuaries also have
recently revised the estimates of the cost of the DI program, raising their
estimates by $5 billion for the period 1984 to 1988.
In conjunction with
these revised outgo figures, the actuaries have reduced their estimates of
the amount of DI reserves that will be o n hand.
quite l o w , these
revised reserve estimates do not a s yet suggest that a financial problem will
emerge i n the DI fund.
While the overall impact made by these two sets of changes is not Clear,
the decision-making atmosphere in the State agencies appears to have changed
Termination rates have fallen from about 45% in 1982 to 37 or 38%
in the latter half of 1983 (i.e., of the cases which are actually reviewed by
the States), and allowance rates on new claims have risen from about 28% to
33 or 34%. Although these changes cannot be directly attributed to the
actions taken by the Administration, these steps and those taken individually
by the States and the courts are probably largely responsible for a apparent
softening of the decision-making process.
Because numerous disability bills have been introduced, this section
discusses only legislation which received some sort of congressional action.
P.L. 98-118, H.R. 4101
Extends the Federal Supplemental Compensation Act of 1982, and for other
Called up by committee discharge in House; passed House Oct.
1983. Called up by unanimous consent in Senate; passed Senate, amended, Oct.
6. Enrolled in both Houses Oct. 7. Signed into law Oct. 1 1 , 1983.
H.R. 2987 (Shannon et al.)
Provides for numerous reforms of the disability determination process,
including standards for decision-making and methods of developing evidence;
continues benefits upon appeal for terminated beneficiaries; imposes a
moratorium o n continuing disability
impairments and makes other reforms in decision process affecting the
Introduced May 1 1 , 1983; referred to Committee on Ways
and Means (considered in subcommittee markup).
H.R. 3391 (Dole et al.)
Extends provision allowing benefits to be received while appealing
termination until June 7 , 1984. Passed Senate Nov. 1 8 , 1983.
[See text on
legislative activity in 98th Congress.]
H.R. 3755 (Pickle et al.)
Social Security Disability Reform Act of 1983.
Amends title I1
Age, Survivors and Disability Insurance) of the Social Security Act to
provide for reform in the disability determination process.
3 , 1983; referred to Committee on Ways and Means.
Ordered to be reported,
[see also H.R.
amended, Mar. 1 4 , 1984. Passed House Mar. 27, 1984.
Similar measures introduced in Senate as S. 2002 (Moynihan et al.)
H.R. 4170 (Rostenkowski et al.)
Provides for tax reform, among other purposes.
1983; referred to Committee on Ways and Means.
with amendment, Oct. 21, 1983.
[contains disability provisions identical to
S. 4 7 6 (Levin et al.)
Requires SSA to appeal to the Supreme Court any Court of Appeals decision
with which it has chosen not to acquiesce; requires SSA to generally show
medical improvement (or clear error) before terminating benefits; eliminates
reconsideration in initial and continuing disability cases but substitutes
the right to a face-to-face interview with the initial decisionmaker after
notification of a preliminary unfavorable determination; makes permanenf
provision continuing benefits until the ALJ decision i n termination cases;
and promulgates uniform standards for disability
Introduced Feb. 1 5 , 1983; referred to Committee on Finance.
Reported by Committee on Finance May 1 8 , 1984, with modifications.
S. 1144 (Heinz et al.)
Provides for revision of regulatory criteria relating
impairments; until the new criteria are in place, requires that no continuing
eligibility reviews would be carried out with
respect to any individual
reason of a mental
previously determined to be under a disability by
impairment; and requires that determination of a mental disability would be
made only on the basis of an evaluation by a qualified psychiatrist or
Introduced Apr. 26, 1983; referred to Committee on Finance.
Related measure passed by Senate as amendment to H.R. 3069
in preceding section on Congressional Interest Continues in 98th Congress.
Committee on Ways and ~ e a n s .
Subcommittee on Social Security. Disability amendments
of 1982. Hearings, 97th Congress, 26 session, on H.R. 5700.
Mar. 16-17, 1982. Washington, U.S. Govt. Print. Off., 1982.
Social security disability insurance.
Congress, 1st session. June 30, 1983.
Govt. Print. Off., 1983. 241 p.
Social Security Miscellaneous and Technical Improvements Act
Hearing, 97th Congress, 2d session, on H.R. 7326.
Dec. 6 , 1982. Washington, U.S. ~ o v t .Print. Off., 1983.
Committee on Finance.
disability insurance program.
Hearing, 97th Congress, 2 6 session.
Aug. 1 8 , 1982. Washington, U.S. Govt. Print. Off., 1982.
Committee on Governmental Affairs.
Subcommittee on Oversight and Government Management.
security disability reviews:
the role of the administrative
Hearing, 98th Congress, 1st session. June 8 , 1983.
Washington, U.S. Govt. Print. Off., 1983.
4 7 0 p.
Oversight of social security disability benefits terminations.
Hearing, 97th Congress, 26 session.
May 25, 1982. Washington,
U.S. Govt. Print. Off., 1982.
Special Committee on Aging.
security reviews of the mentally disabled.
Congress, 1st session. Apr. 7 and 8 , 1983.
Govt. Print. Off., 1983. 373 p.
REPORTS AND CONGRESSIONAL DOCUMENTS
Conference Committee, 1982.
Taxes on Virgin Islands
source income; disability benefits; conference report on H.R. 7093.
Dec. 21, 1982.
(97th Congress, 2d session.
Committee on Ways and Means.
Security Disability Benefits Reform Act of 1984; report o n
Mar. 1 4 , 1984.
(98th Congress, 2 6 session.
Report no. 98-618)
The Tax Reform Act of 1983;
report on H.R. 4170.
Oct. 2 1 , 1983.
1st session. House.
Report no. 98-432)
Committee on Finance.
Rate of certain taxes
paid to Virgin Islands; report on H.R. 7093. Oct. 1 , 1982.
(97th Congress, 26 session.
Senate. Report no. 97-648)
The Social Security Act disability programs; staff data and
Washington, U.S. Govt. Print. Off., Sept. 1983.
The Social Security disability insurance program;
staff data and materials.
Washington, U.S. Govt.
Print. Off., August 1982.
Social Security Disability Amendments of 1984; report on S. 476.
May 1 8 , 1984. (98th Congress, 2d session.
Committee on Governmental Affairs,
Subcommittee on Oversight of Government Management.
Oversight of the Social Security Administration disability
reviews. Washington, U.S. Govt. Print. Off., August 1982.
CHRONOLOGY OF EVENTS
Senate passed H.R. 3755, by a vote of 96-0, substituting
the provisions of S. 4 7 6 affecting disability
termination and related administrative procedures.
Senate Finance Committee reported S. 4 7 6 with
House passed H.R. 3755 (410-1) with
various measures affecting disability termination
and related administrative procedures.
House Ways and Means Committee reported H.R.
House passed with amendment H.R. 3391, dropping from the
bill a Senate-passed 6-month extension of provision allowing
benefits to be paid while a terminated beneficiary appeals
-his or her case.
Senate Finance Committee held hearing on disability reviews,
a t which Administration announced its opposition to pending
legislation and an ending of a temporary
moratorium on reviews, imposed in December 1983.
Administration announced that termination notices
dated Dec. 7 , 1983, or later would not be sent out.
Senate passed, but House failed to take up H.R.
House disapproved rule for floor consideration
of H.R. 4170 (the Tax Reform Act of 1983),
which included disability provisions previously
recommended in H.R. 3755 by Ways and Means
Senate tabled Cohen/Levin amendment to Supplemental
Appropriations bill with disability provisions
similar to those recommended by Ways and Means
The House Ways and Means Committee reported out
H.R. 4170, with the disability provisions contained in
President Reagan signed H.R. 4101 into law
(P.L. 98-1181, providing a 67-day extension of
provision allowing benefits to be paid while a
terminated beneficiary appeals his or her case.
House and Senate passed H.R.
House Committee on Ways and Means approved
House Subcommittee o n Social Security
recommends measure contained in H.R. 3755.
Senate adopted an amendment to suspend eligibility
reviews of persons with mental impairments until
eligibility criteria in the mental impairment
area are revised (later dropped in conference).
Reagan Administration announced various measures
to soften impact of new review process.
Senate Special Committee on Aging began two days
of hearings on problems of terminating
mentally-impaired persons from DI rolls.
Senate Governmental Affairs Subcommittee on Oversight
held hearing on continuing disability investigation
House Select Committee on Aging held hearing on CDI
President signed H.R.
7093 into law as P.L.
Conference committee on H.R. 7093 filed report which
was approved by both House and Senate, clearing the
way for legislation to be sent to the President.
House approved an amended version of Senate-passed
bill, H.R. 7093.
Senate Finance Committee bill (H.R. 7093)
approved by full Senate with amendments offered by
Senate Finance Committee reported out a number of
measures to soften the effects of DI terminations a s
part of a Virgin Islands tax bill, H.R. 7093.
Senate Finance Committee held hearing on DI program,
focusing on the CDI issue.
House Ways and Means Committee reported out H.R.
Disability Amendments of 1982.
House Ways and Means Committee began markup on H.R.
(later becoming H.R. 6181)
Subcommittee on Social Security of House Ways and
Means Committee completed 3 days of markup on H.R.
Disability Amendments of 1982.
House Subcommittee on Social Security completed 2
days of hearings on CDI problem and other DI
Reagan Administration announced plan to speed up
3-year CDI process as part of FY82 budget reductions.
P r e s i d e n t C a r t e r s i g n e d P.L. 9 6 - 2 6 5 , S o c i a l S e c u r i t y
Disability Amendments of 1980, creating among other
p r o v i s i o n s t h e 3-year re-exam process.