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Social Security fraud crackdown criticized

The U.S. General Accounting Office issued a report earlier this month finding that the Social Security Administration is inadequately investigating and ending fraud in its Disability Insurance program. The GAO reported that the SSA adequately addresses cases where beneficiaries no longer meet the requirements for physical or mental disability benefits. The SSA's case review, however, does not maximize potential savings.

Failure to maximize savings may lead to hundreds of millions of dollars in increased costs. This is especially significant because Congress recently provided a $150 billion bailout to the Disability Insurance trust fund to prevent a cash flow crisis. Monthly benefits from this fund are distributed to recipients with an inability to work because they are afflicted with a long-term physical or mental disability.

There are long-standing complaints that fraud permeates this program. The GAO also issued a report in 2012 that hundreds of thousands of reviews of childhood disabilities, including children who were no longer covered because of medical improvement, were more than 3-years late.

Last year, Congress approved stringent criminal and civil penalties fines to address phony disability insurance claims, retirement benefits for deceased beneficiaries and other fraud. These penalties were contained in legislation that also contained measures to raise revenues that were declining in the SSA Disability Insurance program and prevent a 20 percent general benefit cut for 11 million people receiving SSD benefits.

In this report, the GAO claimed that there were higher estimated savings for some groups of beneficiaries than others. Inadequate funding, according to the GAO, contributed to a backlog of 900,000 continuing disability reviews by the end of fiscal year 2014. Conducting timely reviews can consistently assure savings and maintain program integrity.

The SSA has an extensive procedure for reviewing continuing disability review decisions and a significant overall accuracy rate. However, the GAO said that the SSA should systematically use available data to identify error-prone cases and their underlying causes and track errors in these cases. Otherwise, it is difficult to prevent errors from happening again and to even accurately track these errors.

These concerns can cause additional reviews over recipients and impose more requirements for claims. Legal representation may help recipients navigate the application and quality review process.

Source: The Fiscal Times, "Why Social Security's crackdown on disability fraud is coming up short," By Eric Pianin, March 14, 2016

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