Social Security, whether it's in the form of retirement payments, Social Security disability insurance or Supplemental Security Income, is meant to be a safety net. It's there to help the most vulnerable citizens, those with disabilities. But, as any attorney experienced in SSDI and SSI benefits knows, the system doesn't always work as it should.
Much of our attention in this blog focuses on the trials and tribulations in trying to get the Social Security Administration to fulfill its obligations to disabled individuals needing assistance. Less talked about is the fact that sometimes the SSA errs by overpaying a beneficiary, and when the mistake is discovered, the tables get turned and the beneficiary becomes a target.
The government, often claiming fraud and abuse, goes after overpaid beneficiaries, demanding payback for all overpaid amounts, and threatening harsh action as a consequence. And remember, the error was the government's to begin with.
According to the Government Accountability Office, the SSA has paid out more than $1 billion in overpayments in the past two years. Some is acknowledged to be the result of fraud, but a lot of the money has gone to people who didn't know they weren't supposed to be getting it or who had properly informed the SSA that they were no longer due the benefits.
Take, for example, the case of a woman in Massachusetts. She suffers from bipolar disorder. When she returned to work in 2012, she let SSA know and expected to see disability benefits she was getting end. But they kept coming for another year. When she asked why, the agency said the money was to cover underpayments to her the previous year. Not long after that, she got a letter demanding all the money back.
That's more than she makes in a year and she has already spent the benefits. Now, this woman with bipolar disorder is dealing with fears that what little she has in savings will be taken.
The thing for anyone in this kind of situation to know is that they don't have to just give in. Checking with an attorney is always advised. Appeals are possible, or waivers; and both could be sought in some circumstances.
If you know you're being overpaid, keep the money separate until you can work out the problems with the SSA.
Source: Money.CNN.com, "'Critical failures' lead to Social Security overpayments," Blake Ellis, Oct. 29, 2013