GAO: Wait times, bankruptcies, and deaths among applicants who appealed benefit denials
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Monday, October 5, 2020

GAO: Wait times, bankruptcies, and deaths among applicants who appealed benefit denials

By Payroll and Entitlements Editorial Staff

The GAO recently issued a report on the wait times, bankruptcies, and deaths among applicants who have appealed their benefit denials.

The Social Security Administration (SSA) manages two large disability benefit programs–Disability Insurance (DI) and Supplemental Security Income (SSI). As of December 2019, these programs provided benefits to approximately 12.3 million adults living with disabilities and their eligible dependents. A disability applicant who is dissatisfied with the SSA's initial disability determination can appeal the decision to multiple escalating levels of review. From fiscal years 2008 through 2019, the agency received approximately nine million appeals of initial DI or SSI decisions. The GAO has previously reported that applicants who appeal a benefits denial can potentially wait years to receive a final decision, during which time an applicant's health or financial situation could deteriorate.

Given the heightened risk of worsening medical and financial conditions for disability applicants, the GAO was asked to examine the incidence of such events while applicants await a final decision on their disability claim. This report examines the status of disability applicants while they awaited a final benefits decision including 1) their total wait times across all levels of disability appeals within the SSA, 2) their incidence of bankruptcy, and 3) their incidence of death. For wait times, bankruptcies, and deaths, the GAO also examined variations across certain demographic characteristics of applicants.

The GAO obtained administrative data from the SSA for all adult disability applicants from fiscal years 2008 through 2019 who filed an appeal to their initial disability determination. The agency used these data to calculate wait times across appeals levels, rates of approvals and denials, and appeals caseloads, and examined changes in these three areas over time. To describe the incidence of bankruptcy among individuals awaiting a disability appeals decision, the GAO matched SSA disability data to the Administrative Office of the U.S. Courts (AOUSC) bankruptcy data for fiscal years 2014 through 2019. To describe the incidence of death among individuals awaiting a disability appeals decision, the GAO matched the disability data to the SSA's Death Master File. For all of these analyses, the GAO also examined variations across demographic characteristics of applicants, including age, sex, and reported education level. The agency also reviewed relevant policies, agency publications, and federal laws and regulations, and interviewed agency officials.

What the GAO found. The GAO found that most applicants for disability benefits who appealed the SSA’s initial disability determination from fiscal years 2008 through 2019 waited more than one year for a final decision on their claim. Median wait times reached 839 days for claims filed in fiscal year 2015, following an increase of applications during the Great Recession. Wait times have decreased since then as the SSA made substantial progress in reducing the wait for a hearing before an administrative law judge prior to the Coronavirus Disease 2019 (COVID-19) pandemic. Individuals who filed appeals of disability benefits decisions were older and had less education than the overall population of working-age adults. Among these disability applicants, wait times for a final decision did not significantly vary by age, sex, or education levels.

The GAO's analysis of available data from the SSA and AOUSC found that from fiscal years 2014 through 2019, about 48,000 individuals filed for bankruptcy while awaiting a final decision on their disability appeals. This represents about 1.3 percent of the approximately 3.6 million disability applicants who filed appeals during those years. The applicants who filed for bankruptcy while awaiting a disability appeals decision were disproportionately female, older, and had more than a high school education as compared to the total population of disability applicants who filed appeals. Bankruptcies among individuals who were awaiting decisions about disability appeals may have been unrelated to the applicant's claimed disability, though.

The GAO's analysis of the SSA’s disability administrative data and death data found that of the approximately nine million disability applicants who filed an appeal from fiscal year 2008 through 2019, 109,725 died prior to receiving a final decision on their appeal. This represents about 1.2 percent of the total number of disability applicants who filed an appeal during those years. The annual death rate of applicants awaiting a final disability decision has increased in recent years. From fiscal years 2011 through 2018, the annual death rate for applicants pursuing appeals increased from 0.52 percent to 0.72 percent. Applicants who filed their initial disability claim during years of peak wait times and appealed their initial decision died at a higher rate while awaiting a final decision than applicants who filed their initial claim in years with shorter wait times. Disability applicants awaiting a final decision about their appeal who were male died at higher rates than applicants who were female and those who were older died at higher rates than those who were younger. Death rates were largely similar across reported education levels. Deaths among individuals who were awaiting decisions about disability appeals may have been unrelated to the applicant's claimed disability, however.

For more information, contact Elizabeth Curda at (202) 512-7215 or [email protected] (GAO-20-641R, August 13, 2020).

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