Social Security Made $1.3 Billion in Improper Disability Payments

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Social Security Debate Heats Up
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By STEPHEN OHLEMACHER

Social Security made $1.3 billion in potentially improper disability payments to people who had jobs when they were supposed to be unable to work, congressional investigators said in a report Friday.

The Government Accountability Office estimated that 36,000 workers got improper payments from December 2010 to January 2013.

The numbers represent less than 1 percent of beneficiaries and less than 1 percent of disability payments made during the time frame. But GAO said the overpayments reveal weaknesses in Social Security's procedures for policing the system.

"The report lays out clear, common-sense steps that the agency can and should take in order to avoid improper payments," said Sen. Tom Carper, D-Del., chairman of the Senate Homeland Security and Governmental Affairs Committee. "However, if we're serious about preventing waste and fraud and ensuring that these critical benefits get to the people who need and deserve them, Congress must also do its part and provide needed resources and access to basic anti-fraud data to the Social Security Administration."

The Social Security Administration said its accuracy rate for disability payments is more than 99 percent. But the agency noted that even small errors translate into big numbers.

"We are planning to do an investigation, and we will recoup any improper payments from beneficiaries," Social Security spokesman Mark Hinkle said. "It is too soon to tell what caused these overpayments, but if we determine that fraud is involved, we will refer these cases to our office of the inspector general for investigation."

More than 8.2 million disabled workers received disability payments in December 2010, a figure that has grown to nearly 9 million. Last year, the agency paid out $137 billion in disability payments.

Before people can receive disability benefits, there is a 5-month waiting period in which they can, in general, earn no more than about $1,000 a month. The waiting period is to ensure that beneficiaries have long-term disabilities.

Using a federal wage database, investigators checked whether a sample of disability beneficiaries had worked and earned significant wages during the waiting period, the report said. They found that most of the improper payments went to people who worked during the five months they waited for payments to begin.
Once people start receiving benefits, they can return to work and still get benefits during a trial work period, in an attempt to re-enter the workforce. Using the same wage database, investigators checked whether another sample of disability beneficiaries earned significant wages after their trial work period had ended, the report said.

Based on their findings, the GAO estimated the amount of improper payments and the number of people receiving them.

Citing a potential weakness, the report said Social Security might not detect a person who worked during the waiting period if the period started in one year and ended in another. For example, if Social Security starts paying benefits in February, the agency might not detect significant wages earned the previous November because they weren't earned in the same year that benefits were awarded, the report said.

In a written response to the report, the Social Security Administration agency questioned whether GAO overestimated the amount of overpayments. The agency said investigators did not determine whether the work activity qualified as an unsuccessful attempt to return to work, or whether there were any other special circumstances.

The report comes as Social Security's disability program faces a financial crisis. If Congress doesn't act, the trust fund that supports the disability program will run out of money in 2016, according to projections by Social Security's trustees. At that point, the system will collect only enough money in payroll taxes to pay 80 percent of benefits, triggering an automatic 20 percent cut in benefits.

Congress could redirect money from Social Security's much bigger retirement program to shore up the disability program, as it did in 1994. But that would worsen the finances of the retirement program, which is facing its own long-term financial problems.

"This report demonstrates just how little importance the Social Security Administration places on policing its disability rolls," said Sen. Tom Coburn of Oklahoma, the ranking Republican on the Senate Homeland Security and Governmental Affairs Committee. "SSA has known for years that it could prevent millions of dollars in improper disability payments using quarterly wage records, but chose not to."

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13 Comments

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jim

Great idea, let's take retirees money and give it to the people making bekieve they can't work.

September 16 2013 at 10:18 PM Report abuse rate up rate down Reply
betty_brock

Give the money back, Evan.

September 16 2013 at 9:13 PM Report abuse +1 rate up rate down Reply
1 reply to betty_brock's comment
betty_brock

Oh wait. Evan's claim is legit because he is brain dead.

September 16 2013 at 9:20 PM Report abuse +1 rate up rate down Reply
Ginger

Don't be so gullible. This has a very right slant to this story. I've researched numerous States offering Medicaid and found the States with the biggest problems are those with Republican Governors.
AOL is Republican. Bought & paid for by the same people that buy our politicians, majority are Republican. Research it for yourself before you jump to conclusions.

September 16 2013 at 9:10 PM Report abuse -3 rate up rate down Reply
1 reply to Ginger's comment
betty_brock

Malarkey. Stop getting your info from liberal web sites.

September 16 2013 at 9:12 PM Report abuse rate up rate down Reply
betty_brock

When the authorities try to take it back, they will find that these people have no money to pay back.

September 16 2013 at 8:53 PM Report abuse rate up rate down Reply
maloontransllc

These people new they were being paid when they were not suppose to so get it back and I really dont care how. This is the problem with part of or society they feel they should get something for doing nothing.

September 16 2013 at 2:28 PM Report abuse +2 rate up rate down Reply
slverlake3

No problem just go after the people who received the money and get it back. When I was in the service I was overpaid by mistake. It took about 6 weeks but the government came looking for their money and I gave it to them. If they do not have it then attach their wages or seize their property to cover it.

September 16 2013 at 10:00 AM Report abuse rate up rate down Reply
sugarcookie2002

Well im sure socical security will have to pay all those ppl back money

September 15 2013 at 6:30 PM Report abuse rate up rate down Reply
Larry

And you wa t them to manage health care after proving, time after time, that the gummunt is totally incompetant.

September 14 2013 at 10:21 PM Report abuse +3 rate up rate down Reply
tomstamper100

Stop payments and put lien on their wages for fraudulent payments plus very generous interest. Problem solved!

September 14 2013 at 8:45 PM Report abuse +4 rate up rate down Reply
Chris

I'm 28. My generation isn't even going to get social security so this doesn't change anything for me. I'm just really happy to keep paying into it each and every single paycheck. I'll pay till I'm 60 then they'll finally do away with it robbing me of many thousands of dollars they kept taking.

September 14 2013 at 8:05 PM Report abuse -2 rate up rate down Reply
1 reply to Chris's comment
jdrabe

I am 60 and have already paid into it for 42 years, by the time I retire there will be nothing left but broken promises and reduced, if any, benefits left. I predict many retirees will be exploring new career opportunities in the fascinating fields of bank robbery, terrorism and general mayhem making. Personally, I am considering opening torch and pitchfork rental franchises and also, possibly, guillotine sharpening services.

September 15 2013 at 5:13 PM Report abuse -2 rate up rate down Reply