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If you’ve received a larger-than-expected check from Social Security, you’re not alone. The Social Security Administration (SSA) makes billions of dollars in overpayments to Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI) beneficiaries each year. And while it may be tempting to keep the extra money, SSA will almost certainly seek to reclaim it.

SSA has been criticized for the sometimes-harsh measures it takes against beneficiaries that were mistakenly sent excess payments, many of whom are not at fault and can’t afford to pay them back. Recently, the Administration announced action to address the overpayments issue and the injustices associated with it.

Anyone receiving an overpayment notice may want to discuss their legal options with the Social Security attorneys at Graham Law.

SSA’s $23 Billion Overpayment Problem

According to a 2023 report from SSA, the agency has an uncollected overpayments balance of $23 billion. The report also shows that the agency issues around $6 – $7 billion in new overpayments per year. Overpayments topped $11 billion in 2022. Most of these overpayments occurred within the SSI program.

SSA sometimes pays beneficiaries too much money due to agency or beneficiary errors, but much of the fault can be blamed on a system that has complex and hard to follow rules. The system is also plagued by problems like inadequate staffing and built-in lags on data verification, such as information about how much a beneficiary earns, reports KFF Health News.

But even when overpayment is the government’s fault, it is obligated to reclaim the money from overpaid beneficiaries. Sometimes, beneficiaries receive notices years after the alleged overpayments, by which time the amount owed is difficult or impossible for them to repay.

It’s just scary to my husband and me. Where are supposed to come up with this money?

SSA often sends letters demanding repayment within 30 days. When beneficiaries are unable to come up with the money, the government can lower or stop their monthly benefit checks, garnish their wages, or take their federal income tax refunds.

Many beneficiaries say they are shocked to receive overpayment notices and struggle to understand what went wrong. Greenville resident Tammy Eichler told WHIO-TV that she received an overpayment notice from SSA demanding $5,575. SSA informed Phyliss Worley of Dayton that she owed the agency $7,000.

“It’s just scary to my husband and me. Where are supposed to come up with this money?” said Eichler.

Other recipients say they have received repayment notices in the range of $60,000 – $120,000. One recipient told the I-Team that taking away her benefit would make her homeless. Another said she “almost threw up” when she opened the letter.

Social Security Vows to Take Action

Responding to widespread criticism and investigations of it reducing or halting monthly benefit checks to address overpayments, SSA announced a four-step plan to implement policy changes.

In a March 20 press release, SSA committed to the following actions:

  • Imposing a 10% cap on an overpaid beneficiary’s monthly benefit withholding rate for all Social Security programs (10% is already the rate for the SSI program).
  • Shifting the burden of proof in determining what caused the overpayment away from recipients to the agency.
  • Approving repayment plans of up to 60 months for most beneficiaries.
  • Making it easier for overpaid beneficiaries to request a repayment waiver if they believe they are not at fault or don’t have the ability to repay.

The announcement comes just a week after the SSA commissioner called the agency’s repayment clawbacks “cruel-hearted.”

What You Can Do If You Received an Overpayment Notice

SSA’s promised actions are good news for the millions of Americans issued overpayment notices each year. For many, Social Security is their sole source of income. They rely on the benefits to meet their basic needs and can’t afford the additional financial hardship that repayment would impose.

The 10% repayment cap goes into effect on March 25, 2024 and will apply not only to the SSI program, but also the SSDI program and Social Security retirement benefits.

It’s not yet clear when the other proposed policy changes will take effect. But once they do, Social Security recipients who’ve received overpayment notices may be eligible to have their case reevaluated based on the new rules.

For example, overpayment cases can date back years, making it difficult to figure out what went wrong in order to fix it. By shifting the burden of proof to the government, recipients may have a lower hurdle to clear to keep their full benefit amount.

Under current SSA rules, if you received an overpayment notice from SSA, here are your options:

  • File an appeal, in writing, within 60 days of receiving the notice explaining why you don’t think you were overpaid or why the overpayment amount is inaccurate.
  • Request a waiver of collection of overpayment showing you can’t afford the repayment and the error wasn’t your fault, or the overpayment is otherwise unfair to you.

Graham Law receives calls each year from Ohioans who’ve been informed they were overpaid thousands of dollars by SSA and must now pay back the money. You may be able to have the decision reversed, but legal fights with SSA can take years, so you need to file an appeal or waiver right away to start the process.

Contact Social Security attorney Joshua Graham at (740) 454-8585 or email him for a free consultation.

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