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Social Security payments: $6.5 billion in overpayments

Social Security payments were made to seniors in 2009, federal investigator says. One in 10 Social Security payments to very poor were improper.

By Stephen OhlemacherAssociated Press / June 15, 2011

Michael Astrue, commissioner of Social Security, speaks alongside Labor Secretary Hilda Solis (center) and Health and Human Services Secretary Kathleen Sebelius, at a briefing on the Social Security and Medicare Trustee reports at the Treasury Department in Washington, May 13, 2011. On June 14, 2011, a federal investigator said excess Social Security payments amounting to some $6.5 billion were made in 2009.

Jason Reed/Reuters/File

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WASHINGTON – The Social Security Administration made $6.5 billion in overpayments in 2009, including $4 billion under a supplemental income program for the very poor, a government investigator said Tuesday.

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In all, about 10 percent of the payments made by the agency's Supplemental Security Income program were improper, said Patrick P. O'Carroll Jr., the inspector general for Social Security. The program has strict limits on income and assets, and most of the overpayments went to people who did not report all their resources, O'Carroll said.

Error rates were much smaller for retirement, survivor and disability benefits, which make up the overwhelming majority of Social Security payments, O'Carroll told a congressional panel.

"By any standard, the scope of these problems is considerable," said Rep. Charles Boustany, R-La., chairman of the House Ways and Means Oversight subcommittee. "Regardless of whether a payment occurs because of simple error or outright fraud, improper payments harm Social Security programs in the long term, jeopardizing benefits for those who may need them in the future. They also cost taxpayers billions of dollars each year."

Some people received payments they were not entitled to while others received more than they should have.Social Security also made nearly $1.5 billion in underpayments, raising the total amount of improper payments to $8 billion in the 2009 budget year, O'Carroll said.

With lawmakers working to reduce soaring budget deficits, efforts to reduce improper government payments are getting attention in Congress and the White House. In 2009, President Barack Obama directed federal agencies to reduce improper payments, and last year, Congress set a goal of reducing the payments by $50 billion by 2012.

Throughout the federal government, improper payments totaled $125 billion last year, up from $110 billion in 2009, O'Carroll said. In 2009, only two other agencies — the Departments of Health and Human Services, and Labor — had more improper payments than Social Security, he said.

On Tuesday, two Ways and Means subcommittees held a joint hearing on overpayments by Social Security. The agency has improved the accuracy of its payments in each of the past three years and is working on more improvements, Carolyn W. Colvin, the agency's deputy commissioner, said at the hearing.

"We pay nearly 60 million Americans who deserve to receive their benefits timely and accurately, and we deliver on that responsibility in nearly all cases," Colvin said. "We are committed to minimizing improper payments and protecting program dollars from waste, fraud and abuse. In keeping with President Obama's vision, we are also open and transparent about our improper payment situation and our efforts to improve that situation."