Politics & Policy

Social Security for the Dead, Part II

Official investigations have turned up haunting problems with Social Security.

The dead aren’t roaming the earth, but they may well be collecting Social Security checks.

I reported recently on how the Social Security Administration’s Office of the Inspector General succeeded, in a single two-year period, in securing 282 criminal convictions and recovering $16.6 million in stolen funds from people who fraudulently collected benefits when a friend or relative died.

Now, a new report from the OIG finds that the SSA has paid benefits to 2,475 Americans recorded as dead in its own computer database. “Our review focused on the appropriateness of continued payments to these individuals,” the audit dryly remarks.

In 1,546 of the cases cited in the audit, the SSA actually had a death certificate on file. The SSA doesn’t take pulses or peek inside coffins; the receipt of a death certificate is considered an acceptable bureaucratic equivalent, confirming that a beneficiary is definitely, verifiably dead.

But though their death certificates were on file at the SSA, the auditors found, those 1,546 received around $31 million total in zombie payments. They collected $20,023 on average, funds the SSA will now attempt to recover from their bank accounts. If there are cases in which the funds have gone missing, the OIG will review those cases to determine whether a fraud investigation is warranted.

The audit picked up other haunting errors, too. Up to 879 beneficiaries who are recorded as perished may actually still be alive, entered in the SSA’s computer database with a death date but no death certificate for final confirmation.

In some of these instances, beneficiaries’ family members had reported their deaths, in which case the SSA’s records are probably accurate. But in at least ten cases, the OIG discovered that reports of beneficiaries’ deaths had been greatly exaggerated. And a 2011 Scripps Howard investigation suggested that the SSA mistakenly records almost 1,200 living Americans as dead each month.

It’s not the first time an OIG audit has revealed problems of this sort. In May 2009, inspectors discovered that 6,733 people had death dates recorded in the SSA system but were still receiving benefits. Even more troubling, the new report reveals that 91 of the cases flagged in the 2009 report have not yet been remedied.

“The intent of our [new] report is merely to help SSA identify improvements that can further reduce or eliminate improper payments in such cases,” says Jonathan Lasher, the assistant inspector general for external relations at the OIG.

The SSA has responded to the OIG report, saying it plans to reconcile the cases flagged. But delays in righting these problematic cases could carry additional costs. If dead beneficiaries keep collecting for another twelve months, it would cost the living around $15 million, the report found.

Granted, the report’s grim reapings need context: The 2,475 questionable cases caught by the OIG account for only 0.002 percent of all of Social Security’s Title II and Title XVI beneficiaries.

Nevertheless, “while these cases represent a very, very small percentage of beneficiaries, these are cases where the relevant death information is already in the SSA’s records,” Lasher says.

Andrew Biggs, an American Enterprise Institute scholar and former deputy Social Security commissioner, says that the errors found in the audit probably derive from Social Security’s computer systems, which are “very complex, very large, and very old.”

“It’s sort of a technical issue,” Biggs explains. “Obviously, you don’t want to have this kind of stuff. On the other hand, $31 million — well, the system pays approximately $725 billion a year. . . . The bigger picture here may be, I think, that Social Security would like to upgrade their computer systems, but it’s a lot of money to do that.”

Still, the audit’s findings are worrisome. If the Social Security Administration continues to accidentally resurrect the dead, taxes will become the only certainty in life.

— Jillian Kay Melchior is a Thomas L. Rhodes Fellow for the Franklin Center for Government and Public Integrity.




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