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Disability overpayments reach an estimated $1.29 billion

Bigger is not always better. This is never truer than when considering the bloated, inefficient efforts of the Social Security Administration. According to recent GAO report obtained by NBC News, “the SSA may have paid an estimated $1.29 billion in Social Security disability benefits and disability overpayments to 36,000 people who had too much income from work to qualify.”



The disability overpayment amounts differ, with some claimants receiving very little in overpayments, but others received thousands of dollars. For instance, one disability claimant received an estimate $90,000 before the SSA discovered the fraud; others collected $57,000 and $74,000 in disability overpayments.

Why can’t the SSA stop disability overpayments?


Deception and fraud run rampant within the SSA system, but part of the problem could also be confusion. The SSA will have to do further investigations to determine how prevalent the issue really is, although they have taken a preliminary look at disability overpayments to determine the full scope of the problem.

For instance, the GAO investigation only reviewed a portion of the wage data and disability benefit payouts between 2010 and 2013, a review they believe "likely understated" the scope of the problem, but the GAO and SSA admit the exact number could not be determined without case by case investigations.

So why all the confusion?


The rules are complicated. For instance, workers must be determined physically and mentally disabled to receive SSDI benefits. They cannot be engaged in work activities making more than $1100 per month and their condition must be expected to lasts at least 12 continuous months. Workers may also attempt to return to work, but they only have nine months within a rolling 60 month trial work period to receive wages at a certain level and SSDI benefits together.

Given the complexity of the trial work program it’s possible for workers to work too much, make too much money and not be intentionally committing fraud. What should be done? The GAO said that its analysis showed that about 36,000 individuals either earned too much during the waiting period (before they were granted SSDI) or kept collecting SSDI after their nine-month trial period had expired. Individuals who were earning too much money prior to receiving SSDI should never have been approved, and the others should have been caught by the Security Administration's enforcement operation.

What does the SSA say about disability overpayments?


The SSA admits that they could step up their SSA enforcement efforts, but they do claim that of the more than 10 million Americans received disability benefits totaling more than $128 billion, the SSA is able to provide accurate payments to a large majority of them. The SSA does admit, however, that any mistake they make costs taxpayers money, and they want to make sure they investigate disability overpayments and recoup the payments.

What happens if a disability overpayment is fraudulent?


If the SSA determines the disability overpayments were made to claimants who were intentionally trying to manipulate and steal from the system, the disability overpayment cases will be reported to the Office of the Inspector General for investigation and the claimants could face criminal charges.
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