The problem of Social Security overpayments is only getting worse, according to a new report from the Social Security Administration.
The agency’s Fiscal Year 2023 financial report found that as of the end of September, $23 billion in outstanding overpayments were sent, which it tried and failed to claw back.
The report was released on the heels of an exhaustive investigative report in September from KFF Health News, which cited the SSA’s inspector general’s report saying that the agency clawed back $4.7 billion of overpayments in fiscal year 2022, while another $21.6 billion remained outstanding.
The agency also said most of the overpayment claims resulted from COVID-19 stimulus checks that beneficiaries received. According to reports, some recipients have seen their benefits suspended or reduced as a result.
The agency argued that its payment accuracy is high, KKF noted, but the sheer volume of payments it processes (almost $1.2 trillion in the 2021 fiscal year) means, “even small error rates add up to substantial improper payment amounts.”
Concerned lawmakers claim it’s little comfort for those affected, many of whom are on fixed incomes and cannot afford to pay the money back when the error is discovered, sometimes years later.
Critics blame the problem on hard-to-follow rules, a lack of adequate agency staffing, and beneficiary asset limits that are not linked to inflation. It’s that last one on which lawmakers are focusing.
The solution, they say, is to raise what they call the “antiquated asset limit,” which has remained at $2,000 for individuals and $3,000 for couples since Congress last adjusted them for inflation in 1984.
A bicameral, bipartisan bill was introduced in September to do that.
Sherrod Brown, D-Ohio, and Bill Cassidy, R-La., introduced the SSI Savings Penalty Elimination Act (S. 2767) in the Senate, and Brian Higgins, D-N.Y., and Brian Fitzpatrick, R-Penn., did so in the House (H.R. 5408).
“The bipartisan SSI Savings Penalty Elimination Act would increase the asset limit from $2,000 to $10,000 for an individual and from $3,000 to $20,000 for a married couple,” a one-pager of the bill stated.
Increasing the limit “empowers people to prepare themselves for a financial emergency and allows them to enter the workforce without worrying they’ll [lose] their eligibility for SSI by saving too much. Doubling the limit for a married couple relative to that of a single person eliminates a marriage penalty that punishes an SSI beneficiary for getting married.”
