McKinsey Report: $288 Million Social Security Disability IT Program Failing to Deliver, Lacks Leadership

July 23, 2014

Independent analysis advises “reset” for SSA Disability computer system years behind schedule

Today, House Oversight and Government Reform Committee Chairman Darrell Issa, R-Calif., Subcommittee on Economic Growth, Job Creation and Regulatory Affairs Chairman Jim Jordan, R-Ohio, and Subcommittee on Energy Policy, Health Care and Entitlements Chairman James Lankford, R-Okla., pressed the Social Security Administration on the agency’s mismanagement of the Disability Case Processing System (DCPS). A recent McKinsey analysis obtained by the Committee found numerous problems plaguing DCPS, an IT project instituted by SSA to improve disability case processing quality, enhance customer service, and reduce administrative costs among SSA and state disability determination services. According to Committee sources, senior officials at SSA failed to follow standard protocols and procedures in disseminating the McKinsey report throughout the agency, placing a very close hold on the report with the goal of ensuring details about its findings remain secret until after Senate confirmation of Acting Commissioner Carolyn W. Colvin as Commissioner.

The lawmakers write in the letter:

“According to the McKinsey report, the project has permanently been in ‘beta,’ meaning a pre-release version.  The report states that ‘for past 5 years, Release 1.0 [is] consistently projected to be 24-32 months away.’ The report also found that despite spending nearly $300 million, the program has delivered ‘limited functionality, and faced schedule delays as well as increasing stakeholder concerns.’ Moreover, the report found that the DCPS project is adrift, the scope of the project is ambiguous, the project has been poorly executed, and the project’s development lacks leadership.”

The letter continues:

“Additionally, whistleblowers have informed the Committee that following completion of McKinsey’s report on June 3, 2014, senior officials at SSA failed to follow standard protocols and procedures in disseminating the report throughout the agency. According to these sources, senior agency staff placed a very close hold on this report with the goal of ensuring details about its findings remain secret until after [Acting Commissioner Carolyn W. Colvin’s] confirmation by the Senate to be Commissioner.”

Among the report’s findings:

  • McKinsey produced its report on June 3, 2014 and found that that SSA has invested $288 million over six years in the DCPS program, but “delivered limited functionality, and faced schedule delays as well as increasing stakeholder concerns.” SSA leadership decided to “reset” the program to increase the likelihood of successful delivery.
  • McKinsey identified “major challenges” facing DCPS:
  • “While current release plan and beta testing model are conceptually sound, execution has fallen short, resulting in deployment of immature software to production that does not deliver incremental value to DDSs. Response to execution challenges has been to continue going broad without maintaining high quality and full functionality, which has exacerbated change management challenges.”
  • The project has been continually in “beta,” meaning a pre-release version has been released and is currently being tested to evaluate whether it works and meets the system’s business requirements. According to McKinsey, “for past 5 years, Release 1.0 [is] consistently projected to be 24-32 months away.”

The letter requests all documents and communications related to DCPS since March 1, 2014.

The lawmakers’ letter continues the Committee’s oversight of the Social Security Administration’s mismanagement of federal disability programs. The Committee’s oversight has uncovered serious problems, particularly the agency’s development and enforcement of production targets that have no legitimate basis and the agency’s failure to address ALJs rubber stamping millions of claimants onto disability programs over the past decade.

Read the letter here and McKinsey’s analysis here.

Related Documents