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4
Conflicts and
Contradictions in the
Disability Program
A s discussed in Chapter 2, multiple forces co-
AaTesced to produce the Social Security disability
program, and many participants at several levels are responsible for
determining eligibility for the program. Multiple forces continue to
operate, some working to keep the program within its established
boundaries and others pushing against these boundaries, such that
there is continual tension among various elements within the program
as well as between various external forces and the program (Stone,
19841. This chapter examines the tensions and inconsistencies among
the statutory, regulatory, medical, judicial, and programmatic perspec-
tives on disability, highlighting those aspects that relate most directly to
the claimant whose chronic pain is not fully substantiated by objective
clinical evidence. By so doing it further elucidates the complexities of the
issues and provides a more complete context for drawing conclusions
about the way in which chronic pain complaints are evaluated in the
program and for making recommendations for changes.
There are at least four major reasons why disability determinations
will always be subject to differences of opinion and will always contain
an important element of subjectivity. First, disability is a complex
phenomenon. The inability to work is determined not simply by
anatomy, physiology, or mental status, but also by the interplay of
these factors with an individual's education, work experience, psycho-
logical predispositions, social situation, and the available fob opportu-
nities. Judgments based on a combination of so many factors are
necessarily open to wide variation.
66
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CONFLICTS ~D CONTRACTIONS 67
Second, some of the inconsistencies in how the statutes and regula-
tions are interpreted and applied to individual cases clearly derive
from the number of people and offices involved at various levels of
review. There are more than 1,300 district and branch offices with
more than 19,000 people to help claimants complete the proper forms
to file their claims. The actual initial and reconsideration decisions are
made in more than 100 offices across the country by about 4,300
disability examiners and 1,400 physicians under contract to the Social
Security Administration (SSA). For those cases that are appealed
there are more than 130 hearing offices with approximately 700
administrative law judges (ALds) and as many or more decision
writers to assist them. The 20-member Appeals Council is assisted by
324 analysts. Federal quality review of disability decisions is carried
out in 10 SSA offices by more than 500 examiners and medical
consultants. Finally, there are the federal district courts. With so
many people involved in making decisions about anything, there are
bound to be inconsistencies, even if the nature of the decisions were
relatively objective. In determining eligibility for disability benefits,
even the most carefully delineated standards and decision-making
rules cannot eliminate all of the inconsistencies because there will
always be an element of human judgment required.
Third, some of the inconsistencies and tensions derive from differ-
ences in the institutional perspectives of the various participants in
the decision-making process, either because of the nature of their stake
in the decision or because of their disciplinary training and biases. For
example, program administrators are likely to have a very different set
of goals and underlying rationales for their behavior than physicians,
who are oriented to serving their patients/clients (Mashaw, 19831.
Thus, although the basic rules are the same at all levels of review, the
perspectives of the participants and the nature of the evidence at each
level differ enough to cause inconsistencies. Thus, tensions are created
among the various levels and between the SSA and Congress.
Finally, in determining eligibility for disability the basic decision is
inherently value laden: to what extent does this claimant deserve
social aid? No matter how much we try to reduce this question to
well-specified medical and vocational criteria, the moral dimension
remains. "[T]he question in the end is a value conflict about the
distribution of resources. The question is not just what the claimant's
skills, impairments, experience, and so forth are, but whether persons
with that particular set of characteristics ought to have access to public
support" (Mashaw, 19831. In recent years there has been considerable
discussion, especially in the health insurance arena, about the role of
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68 THE PROBLEM OF PMN FOR THE SSA
personal responsibility and eligibility for benefits. Some people believe
that certain potentially health-compromising behaviors, such as smok-
ing, should be cause to charge higher premiums or even to deny
coverage for health problems associated with those behaviors. In the
disability arena, too, some people believe that certain individuals
inflict problems on themselves or that they can control their problems.
Alcoholism, drug addiction, and other mental health problems are
sometimes viewed in this way, as are incapacitating symptoms in the
absence of clinical signs of disease. At one end of the spectrum of
value-laden opinion, some people believe that individuals suffering
from these problems should be excluded from receiving benefits. At the
other end of the spectrum is the view that personal responsibility for
one's disabilities is irrelevant to the need for benefits, and that
decisionmakers should base determinations on the current status and
capacity of the individual, without regard for the cause and etiology of
any condition.
CONGRESS AND THE SOCIAL SECURITY ADMINISTRATION
The SSA is a bureaucratic entity whose existence and jurisdiction
has been mandated by Congress. Like other agencies, its job is to
implement government programs fairly through the agency functions
of investigation, rulemaking, and adjudication. Although Congress
establishes the parameters of bureaucratic activity in statutes, the
agencies develop the rules and regulations by which the program
mission is to be carried out.
The policy implementation role of agencies requires interpreting
and translating congressional intent into workable administrative
policies and procedures that can be applied to individual cases through
adjudication. In executing these functions, there is often room for
agencies to exercise their own discretion. In the case of the authorizing
statute for the disability program, Congress linked medical condition
to employability but did not distinguish clearly between those who
cannot perform work functions because of their conditions and those
who might be able to work but are unemployable because of their
conditions (Mashaw, 19831. Thus, interpretation of the statute, coupled
with the necessarily pragmatic orientation of those charged with
developing administrative guidelines for the day-to-day program op-
eration, may result in agencies viewing or carrying out their missions
somewhat differently than Congress intended (Cofer, 19851.
Periodically Congress chastises the SSA for awarding too many
claims and for allowing too much subjectivity into the decision-making
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CONFLICTS ED CONTRADICTIONS 69
process. Yet the statutory definition of disability is ambiguous enough
to allow many interpretations. Furthermore, at every step in the
decision-making process, judgments are called for an element of
human judgment is built in. Mashaw (1983) notes that the judgments
become more and more discretionary as one moves through the
sequential evaluation from "meets the listings" to "equals the listings"
and on to the assessment of vocational criteria. The listings themselves
contain a mixture of objective standards ("fixation of the spine at 30° or
more from neutral position"), criteria requiring some judgment ("ab-
normal apophyseal articulations as shown by x-ray" [emphasis
added]), and highly discretionary criteria ("appropriate sensory or
motor Toss" Lemphasis added]~. There was very substantial growth in
the proportion of disability awards made on the basis of the more
judgmental categories between 1960 and 1975 (going from about 30
percent to 70 percent of awards being based on "equals" the listings
and vocational factors (Subcommittee on Social Security, 19761; after
1975 the trend reversed, and today about half the awards are based on
these categories). The increased reliance on discretionary criteria
paralleled the growth in the disability program's expenditures during
the same period, and hence became an easy target for criticism of the
SSA by Congress. Other factors that have influenced both the overall
increase in applications and awards and the basis for them include
population growth (particularly among the elderly) and rising unem-
ployment rates that make it more difficult for marginally disabled
people to find jobs (Heaney, 1984; Howards et al., 19801.
TENSIONS WITHIN THE PROGRAM
Medical Definitions Versus Functional Concept
Within the disability program itself there are two major sources of
tension. The first stems from the fact that medical evaluations are
relied on to draw conclusions about work capacity. The "listings"
discussed in Chapter 3 are essentially medical diagnoses and clinical
findings, and most of the evidence used to determine eligibility for
disability benefits is medical. A presumption about occupational fit-
ness and employability is made by program a~ninistrators based on
data provided by physicians, usually in the absence of an actual
assessment of work-related functional capacities.
As discussed in subsequent chapters of this report, there is substan-
tial individual variation in terms of tolerance for pain and other
symptoms and in terms of the amount and nature of dysfunction
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70 THE PROBLEM OF P~N FOR THE SSA
caused by the same level and severity of symptoms. Many factors
interact in complex ways to influence individual tolerance, motivation,
and functional capacities such that some people are able to work in the
face of severe symptoms and others are unable to work when con-
fronted with less severe symptoms. Thus, the presumption of a simple
relation between medical signs and symptoms on the one hand and the
ability to work on the other will always result in some errors of
judgment. Some people who can work will be found eligible for
disability benefits and some who cannot work will be denied benefits.
Income Support Versus Rehabilitation
The second major tension is between the income maintenance and
rehabilitation goals of the program. The report of the HHS Commis-
sion on the Evaluation of Pain (U.S. Department of Health and Human
Services, 1987) notes that although "the primary mission of the
disability program is to pay monthly benefits to those found to be
disabled, a subsidiary objective is to help restore disabled individuals
to productive activity." As an income support program, disability
insurance must take care not to undermine work incentives. For this
purpose the eligibility criteria must be strict (see Chapter 2~. As a
rehabilitation program, disability insurance must take care not to
undermine the potential for effective rehabilitation. For this purpose,
eligibility determination should occur as soon as possible after the
onset of illness or injury and should encourage claimants to view
themselves as able to work, rather than as totally unable to work.
The SSA's definition of disability is deliberately restrictive. The
Social Security disability system is not designed for partially disabled
people or for people who are expected to recover quickly. Yet within the
program there exist numerous rehabilitation provisions. These provi-
sions are presumably designed to encourage and facilitate rehabilita-
tion and yet they seem at odds with the basic definition of disability.
There appears to be a serious "catch-22"—to be eligible for disability
benefits a claimant must prove that he or she is unable to engage in
any substantial gainful employment that exists in the national econ-
omy because of a medical impairment that is expected to either last for
at least 12 months or to end in death. To be eligible for rehabilitation,
a claimant must demonstrate both the potential for work and that
rehabilitation would be beneficial. In light of these conflicting require-
ments, it does not seem surprising that the rehabilitation provisions
are rarely used and that few people ever go off the disability rolls by
returning to work. Furthermore, the same claimant can be found both
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CONFLICTS ^D CONTRADICTIONS 71
not disabled according to SSA criteria and not eligible for rehabilita-
tion services because he or she is too impaired to profit from them.
The rehabilitation provisions themselves contain some conflicting
messages to the state agencies charged with providing services. The
SSA pays state vocational rehabilitation agencies by the case for
services rendered to people who subsequently return to work for a
continuous period of 9 months. Given the stringent eligibility criteria
to receive disability benefits and the often long delays between the
application for and granting of benefits, it would seem that as a group
these people are a poor risk for rehabilitation. Under these conditions,
there is little incentive for state agencies to accept the risk of payment
after the fact for successes only.
As the Pain Commission (U.S. Department of Health and Human
Services, 1987) stated, the need to vigorously "prove and re-prove"
one's disability under the current system works against the rehabili-
tation provisions. The beneficiaries themselves may have little incen-
tive to try to be rehabilitated after being found "disabled." Not only
have many of these people had to work hard to produce the necessary
evidence for their cases, but they have also typically waited a long time
for the process to be completed. The elapsed time between initially
filing a claim and eventually being found eligible for benefits can
easily exceed 2 years if there are appeals. During this time the
claimant's health may have deteriorated. At that point, the likelihood
of successful rehabilitation may have significantly diminished, even in
those whose motivation has remained strong.
Physicians, Claimants, and Administrators
Clinical assessments play a very different role in medical practice
than they do in eligibility determinations. The physician's role and
relationship to the patient in a purely clinical situation is to diagnose
and treat the patient. By contrast, in a gatekeeping situation, the
physician's job is to evaluate a patient for an employer (e.g., to
determine suitability for a job), for a private insurance company (to
assess actuarial risk), for the at services (to determine suitability
for military service), or for a public program dispensing money on the
basis of medical criteria (Stone, 1979~.
The SSA uses physicians in three different ways, each with different
formal relationships to the SSA bureaucracy. First, the SSA relies on
information from a patient's own physician. Most claimants have seen
one or more physicians for their condition before they apply for
benefits, and the medical records are a crucial part of the claimant's
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72 THE PROBLEM OF PIN FOR THE SSA
file. Other than filling out forms, these physicians usually have no
relationship with the SSA. These doctors are selected by the claimant,
and are generally paid by the patient or the patient's insurer.
The second tier is made up of consultative physicians. These are
doctors in private practice who examine applicants at the SSA's
request to provide additional medical evidence deemed necessary for a
decision that is not available in the treating of physician's records.
Consultative physicians are not full-time or salaried employees of the
SSA; instead, they are paid by the SSA for each examination. Some of
these physicians perform just one or only a few examinations each
year. Others do an extensive amount of work for the state Disability
Determination Service (DDS), however, so there is often a continuing
relationship between the state agency and the consultative physician;
there is rarely a continuing relationship between an applicant and a
consultative physician.
Third are the physicians directly employed by the state DDS who
serve on the disability determination teams. These physicians never
see applicants in person; they only review the records of examinations
from the treating and consultative physicians. From these records,
staff physicians, in collaboration with other members of the dete~-~i-
nation teams, make eligibility decisions.
Physicians in these three roles have different relationships with SSA
administrators and with patients/cIaimants, and may have different
perspectives on disability issues. This variation is a source of tension
among physicians, between physicians and patients/claimants, and
between physicians and the program a~ninistrators.
Treating physicians, like claimants, have no inherent interest in the
overall size or expenditures of public programs. Because theirs is an
individualistic view, there is no reason to expect that treating doctors
have taken broad programmatic interest into account in assessing the
patient's medical condition and functional levels.
Unlike program administrators for whom "reliance on nonrepli-
cable, nonreviewable judgement or intuition [is seen] as a singularly
unattractive methodology for decisions" (Mashaw, 1983), health care
professionals routinely are expected to exercise informed judgment.
Decision making in the absence of complete facts and intuitive assess-
meets of patients based on observation are integral to the practice of
medicine. As discussed in Chapter 2, medical professionals have been
given a central role in the disability determination process that is
articulated in law and defined in regulations. Yet some observers
worry that treating physicians may too easily consider patients im-
paired, because their first priority is to help and be an advocate for
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CONFLICTS kD CONTRADICTIONS 73
their patients. Whether they are too lenient or not depends on one's
point of view; that physicians are advocates for their patients' well-be-
ing is as it should be. From the perspective of the treating physicians,
"disability decisions fare] viewed not as attempts to establish the truth
or falsity of some state of the world, but rather as prognoses of the
likely effects of disease or trauma on functioning, and as efforts to
support the client while pursuing therapeutic and vocational pros-
pects" (Mashaw, 19831.
One countervailing force that may operate to make some physicians
conservative in their judgments of disability is the damage such a label
can do to a person. Especially in the SSA disability system, where
disability is defined as the total inability to work and has an implied
permanence, such a label might undermine further medical efforts and
the patient's will to improve.
Although intuition would suggest that personal physicians are more
lenient and the SSA's consultant physicians more stringent in their
judgments, there are few data to support this claim. In fact, one study
found that consultative physicians thought 48 percent of a sample of
disability claimants could work, whereas treating physicians thought
that 55 percent of the sample could work (Carey and Handler, 1986~.
Regardless of the evidence, physicians and administrators within the
SSA believe that treating doctors do not understand the program
criteria adequately and that they are more lenient. These beliefs are
the source of some further strain between the medical community and
the SSA. What is known empirically is that just as some claimants
shop for doctors in an effort to find physicians to certify their disabil-
ities, so too do some program administrators (public and private) seek
consultative examinations to find reasons for not certifying claimants
as disabled (Stone, 19841.
The nature of the disability may also exert a differential impact on
the judgment of treating physicians and SSA personnel. Patients with
cardiovascular problems, for example, appear to elicit higher levels of
perceived legitimacy than those with low back problems or mental
disability. In a study by Nagi (1969), the vast majority of coronary
disease patients judged disabled by a clinical team were also found
unfit for work by the disability examiners, but less than half of the
patients with Tow back problems similarly judged by the clinical team
were found disabled by disability examiners. Furthermore, Nagi found
that among patients with modest physical impairments, those with
minimal psychological limitations were more likely to be found dis-
abled than those with severe psychological limitations.
Physicians who work for the SSA (like company doctors and those
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74 THE PROBLEM OF PAIN FOR THE SSA
employed by HMOs and other organizations) may have conflicting
loyalties. As members of the medical profession, they have been taught
to promote their patient's welfare. Even if they only see the patient
once for a consultative examination, physicians may feel an obligation
to serve the patient well. On the other hand, because they are paid by
the SSA, they may fee] some loyalty to their employer and to the
system as a whole. Like disability evaluators generally, physicians
employed by the SSA in whatever capacity may be influenced by the
political and bureaucratic climate, especially as that affects the quality
assessment reevaluations of their cases. Whether the emphasis is on
too many allowances or too few, or on too much time being taken to
process the claims, all of these messages affect the context within
which judgments are made.
Furthermore, being in a gatekeeping role may compromise (or be
seen as compromising) autonomy and profoundly affect the doctor-
patient relationship, transforming it from one based on mutual trust to
one permeated with mutual distrust. When serving a gatekeeping role
to disability benefits, doctors are believed to be more likely to question
the claimants' credibility and motivation than when they are in only a
clinical role (Stone, 1979, 19841. This transformation (or even the
potential transformation) of the doctor-patient relationship has impor-
tant ethical implications. Limits on trust as a result of the perception
of dual loyalties on the part of providers, or as a consequence of the fact
that medical consultations are required rather than chosen, electively
eliminate informed consent as a means of protecting those who must
enter into a system of medical screening and eligibility determination.
Administrative Law Judges Versus Program Administrators
A claimant who has been denied benefits at the initial acid recon-
sideration levels of administrative review can request a hearing before
an ALE. This level of review differs in many important ways from both
the lower and the higher levels of review. Most significantly, only at
the ALd hearings is the claimant seen face to face by a decisionmaker.
Both the Tower levels of administrative review and the higher levels of
judicial review in the federal courts rely on the written record alone in
making determinations about eligibility for benefits. Other differences
derive from the training and expertise of the more than 700 ALds, the
nature of the hearing and the evidence allowed, and the multiple roles
and concurrent pressures on the judges.
AL~Ts are federally appointed and permanently assigned to an
agency. Permanent assignment is controversial for what appear to be
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CONF'LICTS ED CONTRACTIONS 75
contradictory reasons. Although it is meant to ensure that the judges
have the in-depth expertise necessary to understand the agency's
functions and rules, some observers worry that permanent appoint-
ment, without fear of firing or concern about reelection, encourages
independent decision making. Others have worried that being perma-
nently assigned to an agency may compromise the Alms' impartiality
and independence, because they become loyal to the agency and
because they are financially dependent on it as their effective employer
(Cofer, 19851.
The ALds have a Circuit task that involves juggling three roles
simultaneously. Their job is not only to represent the agency's interest,
but also in effect to represent the claimant and to be an impartial
decisionmaker by equitably balancing the competing interests of the
claimant and the agency. Typically when disability cases come to the
ALds the records are so incomplete that there is an inadequate basis
for decision making. Thus, one of the important tasks of the ALds and
their staffs is developing the record; it is in this sense that ALds serve
as the claimant's advocate.
A considerable amount of tension exists between the SSA and the
ALls in part because the rate of reversal at this level averages about
50 percent and because of substantial variation in the rates of reversal
among the judges themselves. The inconsistencies among the ALds
(reversal rates range from 10 to 90 percent) are most troublesome
because there is no obvious explanation for such wide variation other
than to attribute it to differences in personal opinion and values (Cofer,
19851. The high average rate of reversals is also of concern. In both
instances, observers worry that inappropriate subjectivity enters into
decisions; hence, there is an implicit questioning of the accuracy and
appropriateness of the judges decisions (Mashaw et al., 19781. As
emphasized throughout this report, pain is subjective and there is no
entirely objective way to measure it (see Chapters 7 and 11 especially).
The real issue should not be how to eliminate subjectivity from the
assessment process, but how to factor subjective elements into the
determination process in a more reliable and valid manner. Although
subjectivity is clearly one reason for the high reversal rate, there are
several other reasons as well.
First, when cases arrive before the ALds they are frequently
incomplete. In developing the cases and completing the record, it is not
unusual for the judges to uncover new evidence evidence that was
not considered or was not available at the state determination level.
Second, in the time that elapses between the reconsideration and the
ALd review (which often exceeds one year), claimants' conditions can,
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76 THE PROBLEM OF PIN FOR THE SSA
and often do, deteriorate. Third, the cases heard by the ALds are
unlikely to be straightforward or easy to adjudicate. "The ALds
principally hear cases which lie close enough to the statutory defini-
tion of disability to require human judgement to make the determina-
tion. Therefore, accuracy becomes less empirical, and more subjective,
in these cases" (Cofer, 19851. Given that the cases reviewed by the
ALds are close to the line, and given the further development of the
evidentiary record, face-to-face encounters, and elapsed time between
the lower denial and the ALIT hearing during which the impairment
may have progressed, it is not surprising, or necessarily inappropriate,
that a substantial proportion of decisions are overturned (Mashaw et
al., 1978).
THE FEDERAL COURTS AND CHRONIC DISABLING PAIN
Congressional debate on the Social Security Disability Benefits
Reform Act of 1984 (P.L. 98-460) included discussion about the way the
federal district courts handled allegations of chronic pain and how the
rulings were creating tensions between the courts and both the
Congress and the SSA. Several concerns were aired during this debate:
first, some members of Congress thought the courts were exercising
excessive influence in defining standards by which to assess chronic
disabling pain; second, pain decisions varied widely from circuit to
circuit, suggesting that the law was not being uniformly interpreted or
applied; third, the courts were accused of going beyond what Congress
intended by giving too much weight to claimants' allegations, thereby
broadening and redefining statutory definitions; and fourth, by com-
parison, some members of Congress thought the SSA's rulings were too
restrictive, such that some pain claimants were being improperly
denied benefits (Subcommittee on Social Security of the Committee on
Ways and Means, 1981; Collins and Erfle, 19851. As described in
Chapter 3, in an effort to clarify its intent; and as part of the 1984
amendments, Congress legislated a statutory standard for evaluating
chronic disabling pain.
Once having exhausted all administrative remedies, a claimant can
appeal an unfavorable disability decision for federal court review.
Ordinarily, the federal district court is a trial court; however, for Social
Security disability cases the federal district court acts as an appellate
forum. As such, the federal court carries out a "paper review" of the
record as it was developed in lower levels; the judge never sees the
claimant face to face and therefore is precluded from making a first-
hand assessment of the claimant's (or the witness') credibility. The role
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CONFLICTS ED CONTRACTIONS 77
of the federal district court in Social Security determinations is not to
readjudicate the facts, but to examine the record and assess what is
essentially a single (albeit often multifaceted) legal issue: is the
Secretary's decision supported by substantial evidence?
In actual practice the evidence is often reexamined. What is required
for a federal judge to overturn an ALd's decision is the invalidation of
the process used by the ALJ to evaluate the specific facts of the
situation. Once the process of assessment is negated, then the facts are
left open for the application of relevant statutory interpretation by the
federal judge. Claimants' ads ocates must present the legal arguments
regarding substantial evidence. Because the most effective arguments
tend to be tightly interwove en ~ ith and supported by the facts of the
case, the federal judge is gin en the unofficial opportunity to review the
evidentiary record, while articulating a decision founded in legal
. .
prlnclp e.
Significant controversy can develop among the courts, the Congress,
and the SSA when federal courts repeatedly overrule ALds' decisions.
Often new policy is developed through incremental changes progres-
sively articulated in case lax (see Chapter 31. Although the court's
only function is to interpret and apply existing law, not to rewrite it,
continuing interpretation necessarily leads to expanded application of
statutes, which may go beyond Congress' original intent. Conversely,
it has been argued that the SSA has been excessively restrictive in
promulgating internal rulings and agency regulations that allegedly
ignore congressional intent. This is a constant theme in the political
discussion of all judicial behavior, not only in disability benefit
adjudication. In this respect the disability area only manifests what is
a much larger, more enduring tension between the legislative and
judicial branches.
Another type of tension is created when a federal court bases its
decision on earlier case law that interpreted relevant statutes, regu-
lations, or rulings differently from the Secretary's stated policies. In
recent years the Secretary has agreed to implement the decision
rendered by the court for the particular claimant, but has refused to
apply that decision to other claimants. Therefore, each claimant with
a similar impairment or disability has had to appeal his or her case
through federal court. This policy of the Secretary, termed "non-
acquiescence," was the official position of the Secretary until the 1984
amendments.
Finally, conflict is created between the judiciary and the SSA
because of inconsistencies in decisions from the various U.S. Circuit
Courts of Appeal. Each federal judicial circuit operates as an autono-
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78 THE PROBLEM OF PIN FOR THE SSA
mous unit to the extent that it is not in conflict with the Supreme
Court. Although claimants' advocates often quote the law of other
circuits and one circuit may find another's decision satisfactory and opt
to use it as precedent, no circuit is required to adopt the case law decisions
of another circuit. Adoption of a particular new standard is entirely
discretionary by the court. This situation, coupled with the agency's
policy of nonacquiescence, wreaks havoc on disability program adminis-
trators. In the absence of common, consistent disability determination
standards, federal circuit court judges have attempted to articulate what
they consider to be workable and fair guidelines. Thus, at the federal
court level, as at all the other levels of review, human judgment plays a
part.
COMPENSATION AND INCENTIVES
In addition to the tensions that are specific to the SSA disability
system, there is a controversial question associated with transfer
payments of all kinds: do monetary payments undermine motivation?
A pervasive conventional wisdom (at least as old as sixteenth-century
English poor law) holds that income maintenance payments in any
form—public assistance, industrial injury insurance, veterans pay-
ments, or disability pensions undermine the motivation to work, and
therefore reduce the labor supply and ultimately national productiv-
ity. In terms of disability payments, three types of incentive effects are
often postulated:
I. that the availability of disability benefits acts as an incentive for
workers with marginal disabilities to drop out of the labor force and
seek disability benefits instead;
2. that the receipt of disability benefits acts as a disincentive for the
recipient to return to work; and
3. that the receipt or potential receipt (e.g., a pending application) of
disability compensation acts as a disincentive to rehabilitation.
If disability payments have any of these negative effects, then there
is a conflict between two competing social goals: (1) providing economic
security to disabled people, and (2) both returning as many people as
possible to productive work through rehabilitation and keeping as
many people as possible in the work force.
This topic generated considerable discussion in our committee meet-
ings. The intensity of the debate is indicative of its centrality in larger
questions of social philosophy (see Chapter 21. Although committee
members agreed that the general theory plays a dominant role in
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CONFLICTS ED CONTR~ICTIONS 79
public policy precisely because it amounts to a conventional wisdom,
members disagreed about the correctness of the theory of disincentives
in general, about the three specific propositions, and about the quality
of social science evidence supporting or refuting any of the proposi-
tions.
In the economic choice framework, nonmonetary incentives are viewed
as relatively less important than monetary rewards. This model assumes
that "the individual rationally compares Ethel elected income flows
Efrom disability benefits and from work] and selects the option which
maximizes his elected income" (Haveman et al., 19843. A worker who is
potentially eligible for Usability benefits (because of a condition that
might meet the eligibility requirements) faces a choice between continu-
ing in the labor market or applying for disability benefits. In the second
version of the theory, a worker already on the disability rolls faces a
choice between keeping the level of income provided by the program or
returning to the labor force. In the third version, in which the impact of
disability benefits on rehabilitation is at issue, no such model of conscious
choice is specified, but the underlying assumption in this version is that
the financial gains from remaining disabled exert a negative influencc-
perhaps unconsciously~n the patient's desire to regain skills and
functional abilities. A number of economic studies find some support for
these theories (Luft, 1978; Berkowitz et al, 1976; Parsons 1980a,b;
Leonard, 19791. (See Chapter 5.)
This same theme is found in the literature on the rehabilitation
of chronic pain patients. Many studies use some form of "compensa-
tion" as an independent variable to test the hypothesis that receiv-
ing benefits impedes rehabilitation. Whereas several studies find
that rehabilitation outcomes are less good for people who are receiv-
ing benefits or have claims pending (Krusen and Ford, 1958; Herman
and Baptiste, 1981; Guck et al., 1986), other, often more methodo-
logically sophisticated, studies do not (Rosomoff et al., 1981; Trief
and Stein, 1985; Chapman et al., 1981; Brena et al., 19811. As
discussed in detail in Chapter 12, virtually all of these studies suffer
from severe methodological shortcomings that render the findings
.
inconc usage.
In a society such as ours in which the work ethic is strong and a
sense of personal worth derives from work, it is likely that most
people would prefer to work than to receive "handouts." Thus, al-
though it seems clear that economic forces influence work-related
behaviors (including disability), the committee was not satisfied
that a narrow theory of incentives focused exclusively on income
adequately accounted for the observed behaviors. In fact, most econo-
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80 THE PROBLEM OF PIN FOR THE SSA
mists postulate that behavior is influenced by a more sophisticated
cost-benefit calculus that takes account of the broader work environ-
ment.
Importance of Job Satisfaction
The majority of people who report themselves as disabled do
work (Wolfe, 19791. Therefore, what needs explaining is why some
workers, for whom disability benefits might represent a net economic
gain, remain in the labor force while others do not. Many committee
members felt that certain types of unpleasant or low status jobs
push people out of the labor force at the first opportunity, rather
than disability benefits exerting a "pull" on people. This is borne
out in several studies from the United States and abroad (see Chap-
ter 61. A study by Yelin and his associates (1980) found that work
disability for people with rheumatoid arthritis was predicted by social
characteristics of the workplace more than by any other factors,
including medical factors and physical demands of the job. Control
over the pace of work was found to be especially important. Swedish
data indicate that monotonous, boring work is significantly related to
job dissatisfaction and disability rates (Svensson and Andersson,
1983).
The econometric and rehabilitation studies do not distinguish blue-
from white-collar jobs, much less more refined categories of occupa-
tional characteristics or worker satisfaction. Committee members
pointed out that a common pattern among professionals is to continue
working long past the date when relatively generous retirement
benefits are available. The decision to leave the labor force, therefore,
probably depends as much on the more intangible benefits (or lack of
them) a job provides as on the monetary rewards.
Program Rules as an Explanation of Labor Supply
For recipients of Social Security Disability Insurance (SSDI) or
Supplemental Security Income (SSI), program rules constraining work
effort could account for the low rates of return to work as well as the
putative attractiveness of disability benefits. A person earning more
than $300 per month not only loses disability benefits but eventually
also loses Medicare or Medicaid coverage. For people living at a bare
subsistence level (which includes most disability beneficiaries), the
risk of losing both income and health insurance may be too great a
gamble (Berkowitz, 19811. Although the trial work period represents
OCR for page 81
CONFLICTS ED CONTRADICTIONS 81
an attempt to deal with this problem, very few people take advantage
of it. It simply may not address the basic disincentives and constraints
on returning to the work force we have identified.
Other rules that could explain much of the increased rate of
application to the Social Security disability programs are the require-
ments of many state general assistance and Aid to Families with
Dependent Children (AFDC) programs. During the period from the
mid 1960s to the early 1980s, many ofthese programs began to require
that applicants for general assistance and/or AFDC file an application
with the Social Security disability programs; these state programs
were eager to shift costs out of the state budgets and onto the federal
treasury. Hence, some (perhaps large) portion of the increase in
disability applications in the period when benefit levels were also
increasing must be attributed to government-mandated behavior
rather than to individual choice.
Employment Opportunity as a Determinant of Labor Supply
A critical factor that is often overlooked in discussions of disability
benefits and work disincentives is whether, in fact, jobs are available.
Although economic analyses include attention to employment oppor-
tunity, econometric studies typically use national or regional unem-
ployment rates as an independent variable. Few studies control for the
availability of jobs reasonably near home for a person with a particular
handicap. It may well be that people do not participate in the labor
force only when they cannot get in. In that case, they are not
"choosing" a disability benefit over a potential wage, but rather they
are forced to accept disability benefits because they simply cannot get
a job. There is substantial evidence that people with nondisabling
medical conditions are less likely to be hired than healthy workers,
and that people with chronic conditions and severe handicaps have a
much lower likelihood of finding employment (Weinstock and Haft,
1974; Rothstein, 1983; Stone, 19871. From the employer's perspective
there are perceived risks in hiring or reemploying impaired people,
which may include higher insurance premiums.
In summary, economic and rehabilitation studies show an aggregate
effect of compensation and other factors on labor force participation.
This erect is complex and its causes are difficult to sort out. In the
absence of more detailed and precise studies, the committee found that
the available data could neither adequately explain the observed
relation, nor unequivocally answer the question of whether disability
benefits are a disincentive to work and rehabilitation.
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82 THE PROBLEM OF PAIN POR THE SSA
CONCLUSIONS
It Is clear that the task of determining eligibility for disability is
generally difficult and that making such decisions on the basis of
symptom complaints, such as pain, that are not fully substantiated by
clinical findings is especially difficult. These difficulties derive from the
inherent elusiveness of the concept of "disability," from deliberate
ambiguities in the statutory definition, from the multiplicity of per-
spectives and goals at each level of review and appeal, from the
limitations of medical science, and from the necessary and appropriate
reliance on human judgment. Taken together, these elements of the
decision-making process explain why there are inconsistencies and
conflicts between and among the individuals ant] institutions charged
with making disability determinations.
The committee believes that the goal should not be to eliminate the
tensions and inconsistencies, because to a large extent these are
evidence that an appropriate system of checks and balances is operat-
ing. Instead, the goal should be to ensure a decision-making process
that is as accurate and fair as possible. Human judgment and subjec-
tivity are inherent in that process and appropriate to determinations
that require a combination of so many different kinds of information-
medical, psychosocial, functional, and vocational. However, even sub-
jective determinations can be made more valid and reliable (see
Chapter 11~. Furthermore, although subjectivity is an easy target for
criticism, as this analysis illustrates, it is only one of many contribu-
tory factors to the observed inconsistencies and strains in the system.
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CONFLICTS AND CONTRADICTIONS 83
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84 THE PROBLEM OF PMN FOR THE SSA
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Representative terms from entire chapter:
security disability
