This Year's COLA Is 3.2%

    As expected, this year's Cost Of Living Adjustment (COLA) is 3.2%.

Suspect In Custody After Suspicious Package Found At Georgia Field Office

     From WRDW/WAGT:

A suspect was taken into custody after a suspicious package was found at the Social Security Administration office [in Augusta, GA] on Tuesday, according to the Richmond County Sheriff’s Office. ...

 By 1 p.m., the bomb squad had cleared a suspicious package and a suspect had been taken into custody, according to authorities. ...

What’s Going On With Social Security’s Appropriations?

      Have you wondered about Social Security’s Fiscal Year 2024 appropriations situation? Wanted nonpartisan information?  The Library of Congress’s Congressional Information has you covered in its recently released report Social Security Administration (SSA): FY2024 Annual Limitation on Administrative Expenses (LAE) Appropriation: In Brief. They explain why it’s technically not an appropriation but an LAE. What the report doesn’t say is that the situation for Social Security and almost all other federal agencies is a mess because the Republican majority in the House of Representatives is in complete disarray.

Disability Insurance Income Saves Lives

     From Disability Insurance Income Saves Lives by Alexander Gelber, Timothy Moore, Zhuan Pei and Alexander Strand:

We show that higher payments from US Social Security Disability Insurance (DI) reduce mortality. Using administrative data on new DI beneficiaries, we exploit discontinuities in the benefit formula through a regression kink design. We estimate that $1,000 more in annual DI payments decreases the annual mortality rate of lower-income beneficiaries by approximately 0.18 to 0.35 percentage points, implying an elasticity of mortality with respect to DI income of around -0.6 to -1.0. We find no robust evidence of an effect of DI income on the mortality of higher-income beneficiaries. The mortality effects imply large welfare benefits of disability insurance.

Press Release On Overpayments

     A press release from the Acting Commissioner of Social Security:

The Social Security Administration has provided people with income security for over 80 years.  The agency takes seriously its responsibilities to ensure eligible individuals receive the benefits to which they are entitled and to safeguard the integrity of benefit programs to better serve its customers.  Agency employees work hard to pay the right person the right amount at the right time, and payment accuracy rates remain high.

Social Security pays $1.4 trillion in benefits to more than 71 million people each year.  While payment accuracy rates are high, overpayments do happen given the number of people the agency serves, the number of changes in their circumstances, and the complexity of the programs.

Only around 0.5 percent of Social Security payments are overpayments. For the Supplemental Security Income (SSI) program, overpayments also represent a small percentage of payments—about 8 percent—but are higher due to the complexity in administering statutory income and resource limits and asset evaluations.

“Despite our high accuracy rates, I am putting together a team to review our overpayment policies and procedures to further improve how we serve our customers,” said Kilolo Kijakazi, Acting Commissioner of Social Security. “I have designated a senior official to work out of the Office of the Commissioner to lead the team and report directly to me.”

There is misinformation in the media claiming that the Social Security Administration is attempting to collect $21 billion.  This figure was derived from the total amount of overpayments that have occurred over the history of the programs.  Each person’s situation is unique, and the agency handles overpayments on a case-by-case basis. In particular, if a person doesn’t agree that they’ve been overpaid, or believes the amount is incorrect, they can appeal.  If they believe they shouldn’t have to pay the money back, they can request that the agency waive collection of the overpayment.  There’s no time limit for filing a waiver.

The agency is continually improving how it serves the millions of people who depend on its programs, including by preventing overpayments and making it easier to navigate the recovery and waiver processes.

For instance, the agency just released its streamlined waiver request form that is easier to understand and less burdensome for people to request a debt recovery waiver.  It is also developing a new electronic payroll data exchange program that will automatically use wage information to adjust payment amounts when appropriate to prevent overpayments.  Additionally, the agency intends to publish a proposed rule to streamline processes and reduce burden so eligible individuals can more easily seek debt relief.

When overpayments do happen, the agency is required by law to adjust benefits or recover debts.  The law allows Social Security to waive recovery in some cases, which must be balanced with the agency’s stewardship responsibility to safeguard the integrity of benefit programs and the trust funds.

Social Security is committed to working with people if they seek to appeal or to explore potential repayment options and waivers when allowed by law.

For more information about the overpayment process, please see Overpayments Fact Sheet

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Acting Commissioner Orders Reviews Of Overpayments

     From KFF Health News:

The federal agency that oversees Social Security announced Wednesday that it will review the way it handles “overpayments” — money it sends beneficiaries that it later determines they weren’t entitled to receive. 

The Social Security Administration made the announcement weeks after KFF Health News and Cox Media Group reported that the agency has been trying to reclaim billions of dollars from beneficiaries, including many poor, retired, and disabled people who have spent the money and are unable to repay it. 

“Despite our high accuracy rates, I am putting together a team to review our overpayment policies and procedures to further improve how we serve our customers,” Kilolo Kijakazi, acting commissioner of Social Security, said in a news release.

Kijakazi said she had chosen a “senior official” to lead the team and report directly to her.   …

     This issue will certainly come up when there’s a confirmation hearing for Martin O’Malley’s nomination for Commissioner.   I hope that’s coming up soon. 

Initial Processing Backlogs

     Social Security has released numbers showing the backlogs at the initial level on disability claims. This is from more than six months ago but I don't think there's been significant improvement since. The situation may be worse. The processing time is expressed in days. You can click on the images to view them full size.

Rising Income Inequality And Social Security

       From Marketwatch:

When Alan Greenspan and his committee supposedly “fixed” Social Security’s funding crisis in the early 1980s, the program was supposed to remain solvent well into the 2050s.

Instead, the trust fund is scheduled to run out of money in 2034 — decades ahead of schedule. What went wrong?

Stephen Goss, who has been the Social Security Administration’s chief actuary for more than 20 years, posed this question recently during a retirement conference hosted by the Harkin Institute. And his answer may surprise some people.

Sure, birthrates have collapsed from the heady days of the baby boom, he said, and that trend hasn’t helped. But it’s nothing new: The big fall started in 1965, nearly 20 years before the Greenspan Commission.

And yes, people are living longer than they used to. But that isn’t a surprise, he added —actually, the decline in mortality is pretty much in line with expectations. The forecasts have proven “remarkably accurate,” he said.

So what changed? In a word: inequality.

Goss argued that rising income inequality — with fast growth at the top and slow growth everywhere else — is the mystery ingredient that has thrown Social Security’s finances into turmoil earlier than planned. And the big change took place in the 17 years after the Greenspan Commission made its projection, from 1983 to 2000, he said.

During that time, incomes for the best-paid 6% of earners rose by 62% in real, inflation-adjusted terms, he said. For the other 94%, incomes rose by just 17%.

The net result was that the lion’s share of U.S. income growth was above the Social Security cap, and wasn’t subject to the program’s payroll taxes. The percentage of incomes subject to the program’s tax collapsed from around 90% in the early 1980s to barely 82% by the turn of the millennium. …