Jun 11, 2011

SSI Overpayments Due To Real Estate Ownership

From a recent report by Social Security's Office of Inspector General (footnotes omitted):
SSI [Supplemental Security Income] is a needs-based program, and SSA [Social Security Administration] considers the applicant’s resources, including real property ownership, when determining program eligibility. Real property consists of land and buildings or immovable objects attached permanently to the land. ...

SSA staff can access the LexisNexis Risk Management Solutions database (LexisNexis) as an optional tool to obtain information about SSI applicants’ or recipients’ real property ownership, transfer of real property for less than fair market value, or recent sale of real property. ...

In a July 2009 report, Supplemental Security Income Recipients with Unreported Vehicles, we found that the Agency would have prevented about $551 million in improper payments had its staff used LexisNexis to identify unreported vehicle ownership. ...

While conducting the 2009 audit, we also found that many individuals who did not disclose their vehicle ownership also did not disclose their real property ownership. ...

[W]e used LexisNexis to determine whether there was any indication these individuals owned real property beyond their primary residences. We also reviewed LexisNexis for evidence of other ineligibility issues. In total, we referred 52 cases to SSA for further development since LexisNexis indicated the recipients owned real property that was not accounted for in SSA’s records. ...

SSA’s determinations of SSI recipients’ resources related to real property agreed with public property records in LexisNexis for 298 (85 percent) of the 350 records we reviewed. For the remaining 52 cases, the information in SSA’s records on real property ownership disagreed with information in LexisNexis. LexisNexis data indicated that the recipients owned one or more properties that were not recorded in SSA’s records. SSA reviewed these 52 cases. For 27 of the 52 cases, SSA determined that the information in LexisNexis was accurate; the recipients owned one or more real properties that they had not previously reported to the Agency....

Projecting our findings to the entire population, we estimate that about 541,580 recipients misreported real property ownership, and SSA improperly paid 320,940 of these recipients over $2.2 billion because of their unreported real property.
I would be a bit cautious about this projections. I have dealt with many SSI real property ownership situations where things turned out to be far more complicated than Social Security originally thought. The most common reason is something called "heir property," property in which an SSI recipient has an undivided interest in common with other heirs. Often, there is no practical way for the SSI recipient to demand that the property be divided or sold because land ownership is badly fractionated and there is no way to finance the  transactional expenses involved in dividing the property or forcing a sale. This sort of property usually ends up being sold for unpaid taxes. There are also many, many tracts of property not worth what county tax records show. This is especially the case when we are talking about undeveloped rural real estate which is often almost unmarketable. This is the type of real estate that SSI recipients are most likely to own in my part of the country. The real estate owned by SSI recipients is a can of worms, probably one that Social Security needs to open, but it is still a can of worms. In any case, Social Security can barely open this can of worms with its current staffing level. OIG can issue reports and the House of Representatives can hold hearings but without more personnel it just isn't going to happen.

8 comments:

Anonymous said...

LexisNexis is a great tool? Do CRs have the time to query each recipient before paying the case? No. Something's going to have to give...automation tools are nice, but there's only so much individual CRs can do.

Anonymous said...

In some offices, Lexis/Nexis access is restricted to management only. Guess they don't trust the employees to use the tool for program purposes only. Dumb.

Anonymous said...

I am a TE and am the only non-management employee in our FO with access. Lexis-Nexis is a great tool but I don't have time to screen all of my own cases let alone everyone else's. The study cited suprises me not at all. SSI is way beyond ever being under control--complete lack of resources to address the problems. either hire 5000-7000 SSI CR's or give it back to the states.

Anonymous said...

Or simplify the program. The reason SSI was transferred to the Feds in the 70s was the mishmash of welfare rules and varying benefits among the states. As with most SSA programs, it's developed into a monster. Set basic eligibility requirements and start over.

Anonymous said...

A reason for restricting LN is managing it. There are few audit trail tools available to ensure that LN is used only for work related purposes. OIG was poking around non-work uses, and that makes management skittish. And everyone knows that every time you kick over a rock, you find things that require using resources you don't have to address them. And you have to comply with CMPPA and give people notice that you are taking an adverse action based on running them through a database match which means you have a lot of research to ensure you have the right people. I'd hazard a guess that if the agency did everything OIG says it should do it would be at the expense of actually taking claims.....

Anonymous said...

Rather than have individual CRs look for cars and real estate, why can not this function be automated (with a little computer programing - which for SSA mean another outside contract for mega dollars), as part of the digital application process.
Most SSI applications should come back with a NO checked for LN assets. A few would show a small asset (or fractional asset) and the only question would be if it were listed. There would be a lot of old cars on blocks that have not run for years and no one though to list -- but OIG would be happy.
And every once in a while, it would be BINGO for an unlisted big asset.

Anonymous said...

Another though, all SSI applications showing LN report of undeclared assets, even a 1 cent bank account balance, should be promptly forwarded tp SSA OIIG. They seem to have the staff and resources for this type of investigation. (smile).

MMS Info said...

I am a TE and am the main non-administration worker in our FO with access. Lexis-Nexis is an incredible device yet I don't have room schedule-wise to screen the greater part of my own cases not to mention everybody else's. The study refered to suprises me not in the slightest degree. SSI is way past continually being under control- - complete absence of assets to address the issues. either procure 5000-7000 SSI CR's or give it back to the states. villas for sale meadows