Social Security Administration clawing back $21 billion in overpayments

Social security payments are a safety net for millions of Americans who rely on them to pay for basic living expenses. But now, some are receiving bills for tens of thousands of dollars from the Social Security Administration, asking for repayment.

In a nationwide joint investigation with our Cox Media Group sister stations and KFF, we found the government is clawing back a total of $21.6 billion in Social Security overpayments.

The agency says it paid out to people who should not have gotten that money. Consumer Investigator Jesse Jones talked to a Seattle family about the impact it’s having.

“I feel disappointed and shocked that I owe back that much,” says Seattle native, Alex Hubbard. In 2017 Alex got a letter from the Social Security Administration saying he owes more than $11,000. He is one of hundreds of thousands – possibly millions - who were overpaid by the Social Security Administration. The agency has been clawing back about 4-5 billion a year, from people just like Alex.

Alex received Social Security benefits because he has Asperger’s Syndrome. He lost them because he started working. First at Starbucks, then in a mailroom at Seattle City Light.

Because of his disability, Alex says,  he didn’t know how to report that, “I just wanted to be busy and work 12-hour days.”  He went over his income limit and the government wants its money back. Now.

“I felt upset that they’re coming after my mom. My mom doesn’t know anything about this overpayment issue. And she has nothing to do with it.”Alex’s mother, Linda was responsible for his paperwork because of his disability, he didn’t have the capacity to report his earnings. And as of 2016, she didn’t either, after suffering a stroke.

Linda couldn’t keep up with the letters the Social Security Administration was sending, “I ended up losing my eyesight, and I can only see on [one] side.”

Records show most overpayments are from supplemental security income, or SSI, basically retirement-aged, low income and/or disabled people who exceeded asset or income limits.

“It’s happening every single day to people all around us and across this country,” said Rebecca Vallas, an advocate of economic justice for the disabled. She handled overpayment cases for years as an attorney with legal aid.

Rebecca says beneficiaries are generally some of the lowest income people in this country, “The agency knows full well that they don’t have some pile of cash that they’re sitting on.”

Linda, Alex’s mother, says she can’t afford to pay the money back. But, Alex says he’s willing to try.  “Cut this overpayment in half and maybe work on trying to get this issue solved.”  Alex says, he’ll do his part too.

At their core, overpayments are taxpayer dollars that belong to all of us.

Jessica LaPointe, works for the administrations and says there’s no other way. “We take an oath to be stewards of the trust fund. So unfortunately, we do have to collect overpayments or attempt to collect overpayments when somebody from the public has been overpaid.”

Sources inside the employee union tell us a massive staffing shortage is slowing the system.

Some people may have *tried to report a change in income and couldn’t get through to the call center. It can also take years for workers to re-assess benefits and catch overpayments, longer yet to send out letters.

By the time most people find out they’ve been overpaid, the amount has been growing for years.

Alex said he didn’t receive anything until that shocking letter demanding $11,000. Today, he rents a room in a house in Seattle. He can’t live with his mother because she’s in a 55+ senior living community in Renton. Both could lose everything if the government decides to collect its debt.

His mother worries what is next for Alex. “There are a lot of families like me. Unfortunately, we can’t get the help, and end up with our kids on the streets. Alex is like, well, I’ll just stay downtown in a tent. I said, no, you can’t do that Alex.”

In a statement the Social Security Administration says:

“Social Security is required by law to adjust benefits or recover debts when we establish that someone received payments to which they are not entitled… While staffing losses and resource constraints have challenged our service delivery, our payment accuracy rates remain very high.”

©2023 Cox Media Group