
1 Million More Americans Affected by Social Security Clawbacks Than Originally Reported
The Social Security Administration’s overpayment policies and procedures have faced new scrutiny at the end of 2023 and into the New Year. The Senate Finance Committee is ramping up oversight of Social Security’s overpayment problem and plans to meet with the agency every month “until it is fixed.”
More than 2 million people a year are demanded to give money back to the Social Security Administration (SSA). For years, the agency has been issuing billions of dollars in overpayments — benefits it claims people never should have received.
According to a document KFF Health News and Cox Media Group obtained through a Freedom of Information Act request (FOIA), this is more than twice as many people as the head of the agency disclosed at an October congressional hearing. Recipients are asked to repay the government within 30 days. They also explain how to appeal or request that the government waive the debt.
Acting Commissioner of the Social Security Administration Kilolo Kijakazi read aloud from the document during the hearing but repeatedly left out an entire category of beneficiaries displayed on the paper as well.
The document specifies the fallout from Social Security overpayments and clawbacks is much wider than Kijakazi acknowledged under direct questioning from a House Ways and Means subcommittee that oversees the federal agency.
SSA spokesperson Nicole Tiggemann described the numbers of people Kijakazi provided in her testimony and those she left out as “unverified.”
“We cannot confirm the accuracy of the information, and we have informed the committee,” Tiggemann said. The numbers “were gathered quickly,” and Social Security systems “were not designed to easily determine this information,” she said.
KFF Health News and Cox Media Group sent Tiggemann several emails after the October hearing, asking her to clarify whether the annual numbers Kijakazi gave to Congress included all Social Security programs or just a subset. However, she would not clarify.
Deflated Numbers Being Questioned
For answers, the news organizations several weeks ago filed a FOIA request.
A subcommittee member, Rep. Greg Steube (R-Fla.), said that he wondered if the agency “intentionally deflated the numbers to not make it look as bad as it is” in an interview.
“Maybe we should have her come back in for another hearing, put her under oath,” and ask her “why she wasn’t being completely upfront about the numbers,” Steube said. When he heard Kijakazi’s testimony, he thought she was giving the subcommittee the complete numbers.
Many Social Security beneficiaries have been panicked with the scope of this problem, which has plunged them into financial distress. The overpayments were the government’s fault, and now they are trying to recover billions of dollars from beneficiaries it says it overpaid. In cases where the beneficiary failed to comply with requirements, years can pass before the government pinpoints the mistake and sends a notice demanding repayment, often within 30 days.
It is imperative to know the number of people experiencing overpayments because this can cause a lot of harm, said Kathleen Romig of the Center on Budget and Policy Priorities, who worked in research at the SSA and has since spent 20 years in the field of Social Security policy. “It should be a very high priority at the agency to produce more reliable numbers,” Romig said.
Lawmakers said the agency owed the public that information in follow-up interviews with the news organizations. “If they’re not telling you, I can assure you that’s a question that I’m going to ask in a hearing,” said Rep. Mike Carey of Ohio, the No. 2 Republican on the subcommittee.
At an Oct. 18 hearing, Carey brought up the number of debtors and told Kijakazi, “I think it’s something that we really need to get to the bottom of.”
The people affected are most likely disabled, retired, or struggling to get by on only minimal income. The amount the beneficiary owes the government can grow to tens of thousands of dollars. Obviously far more than people living month to month could likely afford to repay.
The Social Security Administration has been long quantifying overpayments in dollars rather than numbers of people affected. For example, the agency’s latest annual financial report says it recovered more than $4.9 billion in overpayments in the fiscal year that ended Sept. 30 and ended that period with a cumulative uncollected overpayment balance of $23 billion.
Supplemental Security Income Overpayment Neglected
The numbers Kijakazi gave at the hearing covered only two of the three Social Security benefit programs, the document obtained via FOIA shows. Supplemental Security Income (SSI), which provides financial support for people who have little or no income or assets and are blind, otherwise disabled, or at least 65 years old, was not included.
On the paper that the deputy commissioner handed Kijakazi, overpayment counts for SSI appeared directly below the numbers she read aloud, and they were bigger: 1,118,648 people in fiscal 2022 and 1,189,642 in fiscal 2023.
The numbers Kijakazi read at the hearing from the document amount to an estimated 1 million people a year, labeled “T2.” Title II of the Social Security Act covers two programs: Disability Insurance, or DI, and Old-Age and Survivors Insurance, or OASI.
The numbers Kijakazi omitted are labeled “T16.” Title XVI of the Social Security Act covers SSI. Personnel in the SSA use the term T16 when referring to SSI and T2 when referring to OASI and DI combined, said Romig.
Some people who received overpayment notices through SSI may have also received notices through the other programs, leading to overlap between the numbers Kijakazi read at the hearing and those she didn’t provide, Romig said.
The agency paid SSI benefits to an average of 7.5 million recipients a month in 2023. Measured in dollars, the overpayment rate in SSI has been running about 8%, which is much higher than the half a percent overpayment rate for OASI and DI combined.
Yes, the government is at fault for some overpayments; however, others result from beneficiaries failing to comply with requirements, intentionally or otherwise. This includes neglecting to keep the SSA updated about earnings, assets, and in-kind support — for example, whether family members are giving the beneficiary food or a place to stay.
Adding to the issues, the agency relies on manual systems subject to human error. They have been slow to implement systems that would automatically tap payroll data from outside sources. Beneficiaries and advocates for Social Security recipients say the agency frequently loses information they submit, talking to an actual human at the agency can be extremely difficult, wait times are long, and calls get dropped.
Regardless of who was originally at fault, by the time the SSA issues an overpayment notice, years can pass and the alleged overpayment total can balloon. Kijakazi explained, under federal law, the agency must try to recover overpaid amounts, and there is no statute of limitations. To collect debts, the SSA can reach back decades and across generations.
Next Steps
Finance Committee Chair Ron Wyden has been discussing Social Security overpayments and clawbacks with officials at the White House, reports ALM Benefits Pro. Wyden said, “one of the goals for those meetings, is to find out whether the agency can do more about overpayments using the legal powers it already has, including the authority to waive debts.”
And so, it is time to get to the bottom of this overpayment problem. The agency must determine a solution moving forward that can stop the burden of requesting money from benefit recipients asking for money the received that was an error on the government’s behalf.
“The need for action is clear,” said Reps. John B. Larson of Connecticut and Danny K. Davis of Illinois. “There must be a fundamental overhaul of Social Security’s overpayment process – one that puts seniors and Americans with severe disabilities first.”
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