Social Security Administration Overpayments Reach $1.3 Billion


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A new study recently released by the US Government Accountability Office (GAO) claims that the Social Security Administration has paid an estimated $1.3 billion in disability insurance benefits to thousands of people who might not have been eligible to receive them.

The GAO estimates that 36,000 workers received improper disability payments between December 2010 and January 2013.

According to the study findings, the overpayments may have happened for one of two reasons.

First, to become eligible for disability insurance payments, potential recipients must go through a five month waiting period designed to insure that their disability is truly long-term. During this time, their earnings must not exceed $1,000 during any given month. The GAO study indicates that many who were receiving disability benefits had income that exceeded this limit.

Second, once a disabled worker qualifies for benefits, they can take advantage of a trial work period that allows them to return to work for up to nine months while still receiving disability benefits. The GAO study found that many were receiving benefits long after the nine month trial period had ended.

The Social Security Administration insists that its accuracy rate for making disability payments is 99%. But a spokesperson acknowledged that "even small errors cost taxpayers" and promised that not only would the agency investigate the matter, but it would take efforts to recoup erroneously-made payments from beneficiaries.

The GAO report sparked controversy at a time when the long-term viability of the Social Security Administration, and specifically its disability program, has been questioned. Earlier this year, a government study estimated that the government disability trust fund will run dry by the year 2016. The government could divert funds from the retirement system, but since the social security fund is estimated to face insolvency by 2033 - three years earlier than prior estimates - that fix isn't overly attractive to analysts or taxpayers.

Often referred to as the "congressional watchdog," the GAO is an independent and nonpartisan arm of Congress charged with monitoring and investigating how the federal government spends tax dollars. It is headed by the President-appointed Comptroller General of the United States.

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