Social Security

GAO reported in July 1991 (GAO/HRD-91-46) that the amount of newly detected benefit overpayments by the Social Security Administration (SSA) had increased from $1 billion in 1986 to nearly $1.5 billion in 1989. Several factors account for the $500-million increase. First, a one-time accounting adjustment to SSA overpayment records cut the amount of overpayment detections in 1986 from about $1.3 billion to $1 billion. This $340 million adjustment accounts for 68 percent of the increase. Second, SSA estimates that an operational improvement enhanced overpayment detection by about $100 million, or 20 percent of the increase. Growth in the number of people receiving benefits along with increases in benefit levels accounts for the remaining increase in overpayment detections. Although staff reductions could have led to increases in overpayments, GAO found no evidence to support this.

GAO found that: (1) SSA accounting records indicate that overpayments increased by about $500 million from 1986 to 1989; (2) the dollar amount of overpayments detected was not a reliable indicator of overpayment increases, since detections depended on the number of overpayments, the SSA level of effort to detect overpayments, and the effectiveness of detection techniques; (3) a one-time adjustment SSA made to its overpayment accounting records, which had overstated the number of overpayments, explained most of the detected increase; (4) SSA improved its ability to detect overpayments by using tax information to identify recipients who underreported their income; (5) the 4.3-percent increase in the number of people receiving SSA benefits between 1986 and 1989 created more opportunities for overpayments; (6) SSA does not maintain the staffing and work-load data it needs to directly assess the correlation between overpayments and the 20-percent reduction in SSA staff between 1985 and 1990; and (7) comparison of overpayment data both before and after the SSA staff reduction did not produce any indication that staff reductions contributed to overpayments.