From Work-Related Overpayments of Social Security Disability Insurance Beneficiaries: Prevalence And Descriptive Statistics, a study by several researchers for the Mathematica Center for Studying Disability Policy:
Work-related overpayments occur when the Social Security Administration (SSA) issues a monthly benefit to which an individual is not entitled because of engagement in substantial gainful activity. ...71% of the time that a Social Security Disability Insurance Benefits recipient returns to work for long enough at enough pay that his or her benefits should be reduced those benefits aren't actually reduced and there's an overpayment of benefits? That's terrible. It's obvious that there are systemic problems. You can't just blame claimants for this high a rate of overpayments. There are undoubtedly many reasons for this situation but the incredible complexity of the rules applied in cases where beneficiaries return to work have to be a major part. I also think it's too difficult to report return to work.
We found that:
- 1.9 percent of all DI [Disability Insurance] beneficiaries in our sample were overpaid due to work in one or more months during the three-year study period.
- Among DI beneficiaries with sufficient earnings to put them at risk of a work-related overpayment, 71 percent were overpaid.
- Work-related overpayments lasted for a median of nine months.
- Work-related overpayments accrued to a median of over $9,000.
I'll make one simple suggestion which would probably help and it could be implemented without changing any laws. Send a yearly mailer to each person drawing disability benefits each January asking whether they have earned money in the preceding year. If they reply that they have, follow up with them to get the details. If they have worked but remain eligible for benefits at the time, send them quarterly mailers for at least the next couple of years and follow up on the responses. I'll admit that there's one huge problem with my suggestion. Social Security lacks the manpower to deal with the responses they would receive. I'll admit that it's also possible that it wouldn't be cost efficient since only 1.9% o benefits recipients are affected. Got any better ideas?