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Oct 10, 2006

Overpayments Of Attorney Fees

Social Security's Office of Inspector General (OIG) has issued a report on overpayments of attorney fees by SSA. The report concludes that:
During Calendar Years (CY) 2003 and 2004, we estimate SSA issued 594 improper payments to attorneys totaling approximately $2.2 million. While this represented a small portion of the approximately 458,000 attorney payments issued during this period, additional controls could have prevented these improper payments. For example, SSA staff had the ability to bypass system warnings and process payments without indicating the reason for the override or obtaining supervisory approval. We also found the Agency improperly recorded the processing fees collected from each attorney payment. As a result, collected fees associated with the attorney payments may be overstated.
From my experience, I would have to say that this is almost certainly an understatement of the problem.

OIG also found that over one third of the time the attorney did not return the excess fee, although I would wonder how long OIG gave for repayments to come back and be recorded. It can take some time after an attorney returns an excess fee before Social Security's records show this. I have been billed for overpayments long after I returned the money. Also, there are some attorneys who wait to repay money until they receive a bill from Social Security.
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