Study finds billions in Social Security overpayments

Billions of Social Security dollars were lost in overpayments and payments to ineligible beneficiaries from October 2003 to November 2005, a report released today said.

The report, prepared for Sen. Charles E. Grassley, R-Iowa, by the Social Security Administration’s inspector general, found $5.1 billion in disability overpayments and $9.1 billion paid to ineligible beneficiaries. The report concluded that the agency was only able to discover $8.9 billion of the $14.2 billion total and stop the payments or initiate procedures to recover the money. Grassley noted that the $5.3 billion in improper payments equalled 4.8 percent of fiscal 2004 Social Security disability insurance benefits and may not ever be recovered.

 “Social Security Administration officials have established procedures to detect and prevent the vast majority of improper payments,” Grassley said in a statement. “They should be commended for their efforts. However, as this report shows, they need to make additional efforts to fully address the problem.” The report was based on a review of 1,532 sample cases, of which 292, or 15 percent, were overpaid.