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Social Security overpaid disability benefits by $17B, study says

Published Jun. 6, 2015

WASHINGTON — Social Security overpaid disability beneficiaries by nearly $17 billion over the past decade, a government watchdog said Friday, raising alarms about the massive program as it approaches the brink of insolvency.

Many payments went to people who earned too much money to qualify for benefits, or to those no longer disabled. Payments also went to people who had died or were in prison.

In all, nearly half of the 9 million people receiving disability payments were overpaid, according to the results of a 10-year study by the Social Security Administration's inspector general.

Social Security was able to recoup about $8.1 billion, but it often took years to get the money back, the study said.

"Every dollar misallocated is a dollar lost for those who truly need it most," said Sen. Orrin Hatch, R-Utah, chairman of the Senate Finance Committee. "Today's report shows the inability of the Social Security Administration to properly safeguard payments, which has no doubt contributed to speeding the fund toward exhaustion."

The trust fund that supports Social Security's disability program is projected to run out of money late next year, triggering automatic benefit cuts, unless Congress acts.

The program's financial problems go beyond overpayments — Social Security disability has paid out more in benefits than it has collected in payroll taxes every year for the past decade. But concerns about fraud and abuse are complicating the debate in Congress over how to address the program's larger financial problems.

A spokesman for the Social Security Administration said the agency has a high accuracy rate for its payments and a comprehensive debt collection program for overpayments.