Just How Much Do The Feds Waste On Fraud?

by -

At a time when the federal government is running hundreds of billions of dollars in annual budget deficits… is carrying a national debt of well over $18 trillion dollars… and with unfunded entitlement programs trillions of dollars in the red… the Social Security Administration (SSA) overpaid nearly $17 billion in fraudulent SSA disability payments over the last decade.

According to an audit of the SSA’s books by the Office of Inspector General (OIG), some beneficiaries were paid disability benefits for 10 years even though they were ineligible including 216,070 payments to fugitives and prisoners.

The OIG based its estimate of $16.8 billion overpayments on a sample of more than 1,500 Americans who received disability benefits since 2003 that found nearly half were overpaid.

“Our review of 1,532 beneficiaries in current pay status as of October 2003 found that over a 10-year period (from October 2003 through February 2014), SSA assessed overpayments for 44.5 percent of sampled beneficiaries,” the audit said.

“SSA assessed overpayments totaling about $16.8 billion between October 2003 and February 2014 for approximately 4 million beneficiaries who were in current payment status in October 2003…” according to the audit document.

Of that, the agency was able to recover approximately $8.1 billion, though it is still trying to retrieve $6.3 billion in benefits.

The average beneficiary in the OIG’s sample received improper payments for 14 months. Most earned too much or were able to work, making them ineligible for disability. The findings also included 209,643 payments to dead people.

Frank Cristaudo, counselor to SSA Commissioner Carolyn Colvin, said federal law requires the agency to continue paying beneficiaries who may be medically ineligible until after they appeal, a process that can take years.

“We appreciate OIG’s follow-up work from the previous review”…“While the report does not contain any recommendations, we suggest some further clarification of the text of the report,” Cristaudo said.

“During our review of the preliminary findings, we suggested that the OIG clarify the characterization of payments made during the appeal of a medical continuing disability review (CDR) determination to cease benefits,” he said.

“We are required to continue payments for the duration of an appeal, and these payments are later deemed overpayments if we uphold the CDR cessation on appeal. These payments are clearly not ‘improper’ as that statute requires that we make the payment.”

The SSA began conducting annual audits of the SSA disability program at the request of Senator Charles Grassley (R-IA) back in 2006. The audit also revealed that:

The SSA “prevented about $8 billion in overpayments between October 2003 and February 2014 to approximately 1 million beneficiaries in current pay status in October 2003 by suspending monthly payments.”

When asked for his response to the audit results, Senator Grassley said:

“Every dollar that goes to overpayments doesn’t help someone in need. Given the present financial situation of the Social Security Disability Insurance (SSDI) Trust Fund, the program cannot sustain billions of dollars lost to waste.

While the complete elimination of overpayments for either the SSDI or Supplemental Security Income (SSI) programs may not be feasible, the agency is failing beneficiaries and needs to improve its work to rein in the problem.

Congress also may need to look at what additional tools could be provided to further track down and prevent overpayments.”

Candice Thomas
Candice has almost 20 years of experience reporting for various conservative publications. When she's not writing, she enjoys being outdoors--especially camping, hiking, and hunting. She lives in Harrisburg, PA, with her husband.