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Indirect Costs Claimed by the California Disability Determination Services

February 12, 2016

Office Affiliation: The Office of Audit

Audit Report Number: A-09-16-50047

The objective of our report is to determine whether indirect costs by the California Disability Determination Services (CA-DDS) claimed for Fiscal Years (FY) 2010 through 2014 were allowable.

State disability determination services (DDS) perform disability determinations under the Social Security Administration’s (SSA) Disability Insurance and Supplemental Security Income programs in accordance with Federal regulations. Each DDS is responsible for determining claimants’ disabilities and ensuring adequate evidence is available to support its determinations. To assist in making proper disability determinations, each DDS is authorized to purchase medical examinations, x-rays, and laboratory tests on a consultative basis to supplement evidence obtained from the claimants’ physicians or other treating sources. SSA reimburses each DDS for 100 percent of allowable expenditures. Allowable expenditures include both direct and indirect costs.

For FYs 2010 through 2014, SSA reimbursed (CA-DDS) $1.03 billion in administrative expenses, including $108.5 million in indirect costs.



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