Social security digitizes claims process.

The U.S. Social Security Administration hopes its efforts to go paperless by 2005 will save money and ease the crushing backlogs that have plagued the program for more than a decade.

For more than 70 years, the agency has relied on paper files. But Social Security Administrator Jo Anne B. Barnhart has promised that the agency will go paperless by creating electronic folders for the millions of people who apply for disability benefits each year. This technology will enable multitudes of agencies and doctors to handle the millions of claims documents by using common folders online.

According to The Washington Post, Barnhart's plan is to use technology to allow greater data sharing over networks. The agency has hired IBM to help it build a giant 52-terabyte electronic repository that will be accessible to U.S. users. According to IBM, the agency has undertaken one of the biggest content management systems in the world. Indeed, the five-part system is so ambitious that the General Accounting Office (GAO) issued a report this year concluding that the agency was moving too quickly by starting a national rollout in January with out first doing adequate pilot testing or resolving several technical challenges. Because Social Security is introducing its system in stages and starting new features before others are completed, the agency "lacks assurance that the interrelated components will work together," the GAO told Congress in March.

But Social Security is moving ahead with the project, estimating it will cost about $800 million over seven years, in hopes that the effort will save $1.3 billion in reduced costs for paper-handling, mailing, and folder storage. Barnhart told Congress end-to-end testing would have delayed the project by three years.

In the past, everything about a claim either arrived at the agency on paper or subsequently was printed on paper. All documents were stored inside folders that could expand to be five or six inches thick. Folders were mailed to hearing examiners, medical consultants, appellate judges and others--and were often lost. Manual photocopying, along with the time-consuming task of renumbering documents in each folder for appeals, was common.

The Post reports that the agency's new electronic claims system consists of five technology pieces that all center around an electronic folder. Each document is stored as a digital file in a central repository and can be transferred as electronic copies to the state agencies that process claims or over the Internet in encrypted form to outside medical experts. Social Security staff can also copy file collections onto disks. The agency has set up a private Web site and provides special passwords and identification numbers to medical health professionals to submit digital files such as X-ray images. Appeals hearings will be recorded and stored as digital audio files in each applicant's electronic folder. The agency is creating elaborate software programs to track the digital documents at every stage of the claims review. Unlike regular databases, the information in this repository is stored in many formats and will be accessed with various software programs. The agency's new programs include systems to electronically capture and store incoming information about each applicant's claim, to allow that data to be shared among the many people handling the claim, and to provide custom interfaces for state agencies and hearings offices. For the system to function properly, all these programs must work together smoothly.

In January, the Social Security Administration began implementing key pieces of its paperless project in certain states. Many states, however, must first replace their old computers. So far, 18 states are receiving electronic downloads of claims data, and eight are using the electronic folders, according to the agency. For more than a year, people have been able to file disability claims at least partially online.

The agency expects to cut by at least 100 days the average time it takes to process claims, which can take two to three years if an appeal is filed. Already, according to the Post, digitizing the data collection has cut five days off the average time required to get an initial ruling, which recently dropped to 97 days. The Post says the project is a bell-wether for both electronic government and the software industry's push to offer greater interoperability among programs that previously operated as stand-alone silos.