Capitol Correspondence - 10.24.23

Social Security Administration’s Overpayment Policies Under Review

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An American flag in the wind next to signage for a United States Social Security Administration office
Photo credit REUTERS/Fred Prouser
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In a move that could have far-reaching implications for millions of Social Security beneficiaries, the Social Security Administration (SSA) recently announced that it would conduct a comprehensive review of its handling of “overpayments.” These are funds sent to beneficiaries that the agency later determines should not have been received.

This announcement follows KFF Health News and Cox Media Group’s recent report, which highlighted the agency’s efforts to reclaim billions of dollars from beneficiaries, including many individuals who are poor, retired, or have disabilities. These beneficiaries often find themselves financially strapped and unable to repay the money.

Kilolo Kijakazi, acting commissioner of Social Security, responded to these concerns by stating, “Despite our high accuracy rates, I am putting together a team to review our overpayment policies and procedures to further improve how we serve our customers.”

In the fiscal year 2022, the agency successfully recovered $4.7 billion in overpayments, as reported by SSA’s inspector general. KFF Health News found that once the agency identifies an error and notifies the beneficiary about the overpayment, years may have passed, resulting in substantial sums owed, sometimes reaching tens of thousands of dollars or more.

In light of the KFF Health News/CMG investigation, some members of Congress are calling for accountability and a change in the approach taken by the Social Security Administration. Senator Sherrod Brown (D-OH), who chairs a Senate panel overseeing Social Security, emphasized the need for improvement, stating, “The government’s got to fix this. It’s a management problem, and people there should be held accountable.”

Overpayments can occur due to various factors according to the SSA, including government errors or beneficiaries failing to comply with program requirements, whether intentionally or unintentionally. One significant factor is that individuals seeking certain benefits face limitations on how much they can save, and these limits have not been updated for inflation in decades.

According to the Social Security Administration’s data, many overpayments are a result of agency errors or lapses. While Social Security disburses $1.4 trillion in benefits to over 71 million people annually, approximately 0.5% of these payments are classified as overpayments.

The overpayment rate is notably higher in the Supplemental Security Income (SSI) program, with overpayments representing about 8% of payments, according to SSA’s news release.

The agency is legally obligated to adjust benefits or recover debts when overpayments occur, and beneficiaries have the option to appeal or request a waiver to waive the collection of the overpayment. SSA has recently released a streamlined waiver request to make the process more accessible.

To learn more about overpayments and beneficiaries rights, SSA has released a fact sheet.