BIG UPDATE: Social Security Pays Wrong People $22.8 Million: Fed Report
According to Newsweek, A recent audit has uncovered that the Social Security Administration (SSA) has mistakenly disbursed over $20 million in benefits to the wrong recipients. The Office of the Inspector General (OIG) reported that the SSA paid out $22.8 million to incorrect payees due to errors in its Electronic Representative Payee System (eRPS), a web-based application used for processing payee applications and managing related information.
Representative payees, typically family members or friends, are designated to receive and manage Social Security or Supplemental Security Income payments on behalf of beneficiaries who cannot manage their own benefits, such as children or individuals with severe disabilities.
Root Causes of the Issue
The audit identified that inaccuracies in payee information within the eRPS system are the primary cause of these overpayments. SSA employees are responsible for manually transferring information from the eRPS to payment records. Although the application alerts employees to discrepancies, the report highlights that “employees should review eRPS and the payment records after they process payee applications to ensure their inputs worked appropriately.”
The report also indicates that when manual actions are necessary and adequate controls are lacking, there is a heightened risk of incomplete or incorrect processing.
Furthermore, the SSA inaccurately recorded the types of payees for about 9,300 beneficiaries, leading to either missing required accounting reports or receiving unnecessary reports from approximately 3,900 payees. Each year, representative payees must submit a form to account for the benefits received on behalf of the beneficiaries.
Risks of Continued Inaccuracies
The OIG report cautioned that without significant improvements, the SSA will likely continue to issue benefits to incorrect payees without effective monitoring. This increases the risk that benefits intended for the actual beneficiaries may be misused, potentially failing to meet their needs.
Newsweek reached out to the SSA for comments outside of regular business hours.
Recommendations for Improvement
To address these issues, the OIG has recommended a thorough review of beneficiaries with payee discrepancies and reminded staff to adhere to proper application processes. The SSA has agreed to implement these recommendations.
The agency is also grappling with over a billion dollars in incorrect payments related to both underpayments and overpayments, where recipients receive incorrect amounts due to miscalculations. Newsweek previously reported on numerous cases of elderly and disabled recipients facing repayment demands, sometimes amounting to tens of thousands of dollars, after their benefits were miscalculated. Many have been required to repay the full amount within 30 days of receiving a notice from the SSA, even when the errors were not their fault.
