Social Security Overpays Billions of Dollars in Benefits

As a Social Security blogger I typically search for news stories on the topic several times a week.  Imagine my surprise when the top stories this morning are about Social Security overpaying benefits, sometimes tens of thousands of dollars!

‘Critical failures’ lead to Social Security overpayments – CNN  Wed, 30 Oct 2013 11:33:06 GMT

Long after notifying Social Security that they have either started working again or earn too much income to qualify for benefits, some disability recipients continue to receive payments for months or even years. It’s not until a notice from Social Security shows up that they discover they now owe tens of thousands of dollars to the agency due to these overpayments.

Typical of our government leaders, Social Security is blaming the overpayments on fraud and abuse.  While there have been plenty of examples of abuse by beneficiaries, especially when it comes to disability benefits, in this case the overpayments can be traced to critical failures within the Social Security system.

Social Security employees must manually review income information to determine if people receiving disability benefits still qualify.

With a shortage of workers at SSA and a large increase in disability applications, the process is taking much longer than it should, thus resulting in people receiving payments for many months or even years after they no longer qualify.

To their credit, many beneficiaries who received overpayments have tried to correct the problem, but have had trouble getting the payments to stop due to the backlog at the Social Security Administration.

‘I was overpaid by Social Security’ – CNNMoney  Mon, 28 Oct 2013 10:24:34 GMT

When Rivetto’s husband received a raise that meant their family no longer qualified for benefits, she reported the change in income to Social Security six months later. That turned out to be a big mistake.

According to a recent audit by the Government Accountability Office, the Social Security Administration has made $1.3 billion in overpayments in just two years.  While they are working on correcting this problem, the SSA has lost over 11,000 employees since 2011; at the same time the work load is increasing due to baby boomers applying for retirement and an increase in disability applications.  The SSA has stated that they will investigate any issues raised by the GAO, but I wouldn’t expect to see any results soon…