Financial experts expressed concern on June 24, 2024, over the recovery of overpaid funds by the Social Security Administration (SSA). Often due to accounting errors, these overpayments reach into the thousands of dollars, causing possible financial distress for beneficiaries.
The experts called for a review of SSA’s recovery practices and measures to limit such significant overpayments. They argue that unchecked, these practices could destabilize millions of beneficiaries’ financial security and undermine public confidence in the Administration.
An improved auditing system and flexible repayment plans were proposed as solutions. Such measures, they believe, would ensure the financial sustainability of the Social Security system while also protecting beneficiaries.
The main issue identified by experts is SSA’s strict interpretation of a clause in the Social Security Act. This clause aims to shield beneficiaries who may face financial hardship from repaying excess funds. The agency’s rigid interpretation often results in lack of fairness and ethics.
Despite these concerns, SSA staff are instructed to recover the entire amount, threatening many beneficiaries’ income source.
Addressing Social Security’s overpayment issue
This practice persists, even in cases of beneficiaries facing significant financial hardships.
In the fiscal year 2023, the SSA reclaimed $4.9 billion in overdue payments. Experts have subsequently advocated for a cap on repayment timelines, especially when overpayments are the SSA’s fault. The authorities stressed reviewing the agency’s payment mechanism to reduce these errors.
In response, the agency defended their practice, stating they adjust benefits and recover overpayments as required by law. They also emphasized their commitment to clear communication with benefit recipients and have implemented systems for regular check-ins to prevent future debt accumulation.
In March 2024, the SSA proposed four major adjustments to address overpayment issues. These changes include extending repayment periods, shifting the proof responsibility, and allowing beneficiaries to apply for repayment exemption. They aim to alleviate the negative impacts of overpayments.
The author of this report, Aliss Higham, is a Glasgow-based reporter focusing on U.S. affairs. Starting as a journalist in 2024, she has covered a broad range of issues, establishing herself as a reliable source of significant news within the field.
