Audit Finds That Thousands of SSI Recipients Have Been Overpaid

When the Social Security Administration (SSA) determines that a person with disabilities is eligible for Supplemental Security Income (SSI) benefits, the decision is not necessarily permanent. Depending on the circumstance, the SSA will either regularly or semi-regularly re-examine the person’s eligibility.  This reexamination is known as a “redetermination.”

According to a 2018 audit, however, the SSA is not conducting redeterminations at the frequency required by federal regulations, resulting in the agency potentially overpaying hundreds of millions of dollars to certain beneficiaries. As many as 77,000 beneficiaries may be forced to pay back some or all of their overpayments.

Under the Social Security Act, the SSA is required to regularly conduct redeterminations for non-medical factors that may affect a recipient’s continuing SSI eligibility, such as the person’s resources, income or living arrangements.

Originally, the SSA conducted such redeterminations every three years. But due to budget cuts, since the early 1990s, the SSA has relied on a two-pronged approach: annual redeterminations where changes in the person’s circumstances are likely, and once every six years where changes are unlikely.

The audit by the SSA’s Office of the Inspector General found that despite the six-year rule, 1.1 million recipients – almost one in eight beneficiaries – have not had a required redetermination in at least a decade. After examining randomly selected cases from this group, the Inspector General estimates that the SSA has overpaid about $380 million to about 77,000 SSI beneficiaries because it failed to flag ineligible beneficiaries in a timely manner. By comparison, in 2017 the SSA paid a total of $51.4 billion dollars to 8.2 million SSI beneficiaries.

By far the most common reason for overpayment, the audit found, were changes in the person’s total resources that put them over SSI’s threshold for eligibility. SSI’s resource limit has remained unchanged since 1989 – $2,000 for individual beneficiaries and $3,000 for couples.

Where the SSA overpays an SSI recipient, Social Security Act regulations permit the agency to seek payments dating back two years. No such two-year limitation exists where the overpayment is the result of fraud.

As a result of the investigation, the SSA’s Office of Quality Review is now conducting a separate review. In addition to budgeting more money for redeterminations, the audit also recommended that the SSA incorporate a system of mailed questionnaires for determining when redeterminations are necessary, as it currently does where it suspects that SSI beneficiaries may no longer be eligible due to changes in their medical status.