The Death Master File Again

      Even though budget bill announced yesterday is supposed to deal just with top line numbers, budget bills  often contain extraneous items. The agreement announced yesterday contains an extraneous item affecting Social Security. From the press release on the budget deal:

Restriction on access to the Death Master File 

This provision creates a program under which the Secretary of Commerce restricts access to information contained on the Death Master File (a list of deceased individuals and their Social Security numbers, dates of birth, and dates of death, maintained by the Social Security Administration) for a three-year period beginning on the date of an individual’s death — except to persons who are certified under the program to access such information sooner. A penalty of $1,000 is imposed for each improper disclosure or misuse of information obtained from the DMF, up to a maximum of $250,000 per person per calendar year. The Secretary is required to establish and collect user fees sufficient to recover all costs associated with the certification program.

     The Death Master File (DMF) sounds deadly boring but it's important. Benefit payments to dead people make for bad publicity for the Social Security Administration. That's why the DMF exists. However, the DMF isn't completely accurate. Some people get listed as dead when they're alive. It's a small percentage but it still amounts to a lot of people because the DMF is so large. It's bad enough that their Social Security payments are halted but what's worse is that financial institutions and other government agencies have been able to get access to the DMF and they have been freezing financial accounts and non-Social Security government payments of the supposedly dead people. Often these people have not been receiving Social Security benefits and have no idea that an error in the DMF is the reason that financial institutions and government agencies are freezing their accounts. They have no idea where to turn to prove that they are alive. Even after they have convinced Social Security that they are alive, they are at risk because bad people can compare the DMF over time to look for names that have been removed from the DMF. These are people that the identity thieves will know to be alive and they will know their name, date of birth and Social Security number. Also, some identity thieves look for the names of those who died as children years ago. They use the identities of those who died as children to apply for financial accounts which they loot. They seem to be able to do this despite the DMF. The relatives of those who died as children find this deeply unsettling.

     On the other hand, financial institutions have a legitimate interest in freezing the accounts of those who have died. The DMF is also used to identify life insurance policy holders who have died but whose relatives have not filed claims because they were unaware of the life insurance policies. The insurance companies don't really want to do this but they're forced to do so by state insurance agencies. Billions of dollars in life insurance benefits are paid each year because of the DMF. Those involved in genealogy research scream loudly about any possible change to DMF access since it's crucial to what they do. Genealogy researchers are a stronger lobby than you might imagine.

     I have no idea why this bill would give the Secretary of Commerce some control over the DMF. I have no idea who might get certified to get access to the DMF. Just government agencies? Just federal agencies? Some financial institutions? We'll have to wait for the fine print.