Up to $166 Million Wasted on Unneeded Medical Tests for Disabilities, Study Says

Congressional investigators found that the Social Security Administration may have wasted up to $166 million over the last two years through unnecessary medical tests on patients who applied for disability aid, according to reports released today.

Rep. Ted Weiss (D-N.Y.), chairman of a House Government Operations subcommittee investigating the problem, said there also is evidence that doctors overcharged the federal agency for such tests.

Weiss’ panel concluded that doctors performed unneeded tests on 30% to 50% of all patients who contended they were unable to work due to physical or mental reasons, a subcommittee aide said.

“We found that these unnecessary tests were ordered either by inept state bureaucrats or profiteering doctors,” the aide said.

The subcommittee also made public a report on the same topic by the General Accounting Office.

Patricia Owens, assistant disability commissioner, told a subcommittee hearing today that she agreed there were “some problems” with unnecessary tests. She said the agency has been reviewing the tests of thousands of doctors paid by the agency.

Weiss also told of a regional finding that doctors in Texas had improperly “marked up” lab costs, billing the agency $290,000 more than what lab tests actually cost last year. He cited instances of $15 lab tests for which doctors were successfully charging $50.

The GAO study said the Social Security Administration spent $332 million on such procedures--many of which included X-rays and lab tests not necessary to confirm diagnoses of the patients’ conditions--in the last two years.

The affected patients, many of whom are elderly, blind or disabled, were undergoing medical exams to qualify for benefits under the Social Security Disability Insurance and the Supplemental Security Income programs.

State agencies, which decide applicants’ eligibility for the assistance programs, either specify in advance that the tests are to be given or rule on the validity of tests already ordered by doctors.

About half of all applicants are required to undergo exams to determine the severity of their impairments.