Improper Social Security payments surpass $1B amid ‘record-breaking backlog’: Report

(NEXSTAR) – The Social Security Administration (SSA) is wrestling with a “record-breaking backlog” of cases that has led to roughly $1.1 billion in improper payments, according to a new report by the SSA Office of the Inspector General (OIG).

The OIG, which works to improve efficiency and effectiveness in the SSA’s programs, looked at both wrong payments and so-called pending actions that were left unresolved at processing centers between the fiscal years 2018 and 2023.

The longer that underpayments or overpayments went on without correction, the more the mistakes mounted. The OIG said the average processing time for an improper payment in their sample was 698 days.

“Customer satisfaction has been an ongoing concern for SSA. This report continues to highlight the urgency for SSA to reach its pending actions performance goal and to ensure beneficiaries receive their proper payments as promptly as possible,” said Michelle Anderson, Assistant Inspector General for Audit serving as the Acting Inspector General for SSA.

The Social Security Administration told the OIG the backlog was in part due to unexpected staff reductions, heavier workloads and less overtime funding at processing centers.

In one instance, the OIG found that the SSA overpaid a disability beneficiary by about $62,000. The SSA learned of the mistake in June 2021, after the beneficiary had already received an extra $9,000 over four months, but the administration didn’t take action to collect the overpayment until May, 2023, the OIG found. By then, the beneficiary had received an additional $53,000.

The OIG found that although the SSA met its performance goals in four of the six years, the backlog of pending actions at processing centers didn’t diminish, rather it grew from 3.2 million in 2018 to 4.6 million in 2023. As the backlog grew, so did the time it took to resolve pending cases, driving up the total value of unresolved payments.

The OIG estimates that if the SSA had resolved the backlog of pending actions at the “earliest possible instance,” there would have been approximately $534 million in improper payments to 528,000 beneficiaries. After failing to correct those payments for months, many for over a year, the improper payment total ballooned to an estimated $1.1 billion, according to the report.

The SSA has agreed to the following recommendations made by the OIG, according to Anderson:

• Develop a workload and staffing plan that will allow the SSA to reduce the backlog from year to year
• Create performance measures with goals to reduce the pending actions at processing centers
• Establish timeframe targets for processing centers to keep improper payments from growing and to reduce the burden on beneficiaries

In March of 2024, the SSA announced that it was changing the recovery process for overpayments to ease the financial hardship on beneficiaries by reducing the default monthly withholding rate to ten percent (or $10, whichever is greater) from 100 percent.

Beneficiaries who were overpaid can also appeal to have the collection process waived entirely if they think it was not their fault and they aren’t able to pay it back.