Social Security Administration Spends Billions in Overpayments Says Attorney David Magann

Tampa, FL (Law Firm Newswire) August 31, 2015 – An audit report released on July 1 reveals that the Social Security Administration (SSA) has overpaid almost $17 billion in disability benefits over the past decade, with some individuals still receiving payments despite being ineligible.

The audit, issued by the Office of the Inspector General, examined a sample group of 1,532 Americans receiving disability benefits from October 2003 to February 2014. The results indicate that around 50 percent of the people were overpaid. The SSA estimates only $8.1 billion of the $17 billion in overpayments has been recovered, and that it costs an average of $268.32 to recover each disability insurance overpayment.

“Every dollar lost in overpayments does not help someone who is truly in need. For many who are disabled, social security benefits may be their only potential source of income. With the current situation, the people who are deserving of disability support sometimes end up not receiving it,” said David W. Magann, a prominent attorney in Tampa, Florida, whose firm specializes in Social Security disability law.

Over 15 million disabled Americans rely on the SSA’s disability program, but could see their benefits cut by 20 percent at the end of 2016, when the trust fund that supports the program is projected to run out of money. Republicans have rejected the simple short-term solution of shifting funds from the bigger Social Security retirement program to disability, saying they are seeking a long-term financing solution before funds run out.

Report findings also indicated that the SSA spends three times more money than it collects when trying to recover overpayments. The most common overpayments went to people whose changes in income rendered them ineligible for benefits, or to those who were no longer disabled. Diverting the money it spent to collect low-dollar overpayments could have saved the SSA up to $3.2 billion, the audit suggested.

“The SSA should adopt a more efficient process to collect overpayments so that valuable resources are not wasted. The system needs to be re-evaluated and changed soon, especially with cuts to benefits looming next year,” said Magann.