U.S. Makes $1.2 Bil in Disability “Overpayments”

In a recent example of egregious government waste, the U.S. has doled out more than a billion dollars in disability benefits to tens of thousands of people who were not supposed to get it.

One recipient got $90,000—nearly twice the median annual income in the U.S.—without being detected by the Social Security Administration (SSA), the agency that hands out the cash. Others raked in $74,000 and $57,000 without raising any alarms. In all, 36,000 people who didn’t qualify for SSA disability money received an astounding $1.29 billion without getting caught, according to a federal audit.  

It gets better. The figure “likely understated” the scope of the problem, say investigators from the Government Accountability Office (GAO), the investigative arm of the U.S. Congress. That’s because they’re not really complete, only partial numbers resulting from comparing federal wage data to disability insurance rolls between 2010 and 2013. Without a lengthy, case by case probe the true figure cannot possibly be determined, the GAO says.

It’s safe to be that it’s much higher than $1.29 billion in just three years, which is outrageous enough. Sadly, this sort of rampant fraud and corruption is quite common in bloated government programs that hand out benefits without adequate scrutiny. To qualify for disability benefits from the government recipients must prove that they have a long term physical or mental impairment that prevents them from working.

When a candidate meets the criteria, the feds approve monthly payments of around $1,000 that start rolling in after a five-month waiting period. During those five months the applicant can’t receive monthly income that exceeds the $1,000. The GAO probe found that 36,000 individuals either earned too much during the waiting period or kept collecting long after the disability payments were supposed to end.

SSA is trying to play it off as if this weren’t a big deal because $1.29 billion is only a tiny portion of the money it spends annually on disability benefits. But it’s still a chunk of change that could be wiser spent. In fiscal year 2011, more than 10 million Americans received disability benefits totaling an astounding $128 billion, according to the report. That means less than half of 1% of recipients are receiving improper payments.

Judicial Watch has investigated SSA over statistical data the agency keeps involving “No Match” letters sent to employers. The written notices are issued by SSA to employers that provide wage reports with Social Security numbers and names that don’t match, indicating fraud or an illegal immigration problem. As part of a widespread probe JW requested SSA records detailing the top 100 U.S. employers receiving the highest number of Social Security number mismatches. This was years ago and we’re still waiting for the files.