Elon Musk’s Department of Government Efficiency (DOGE) is now focusing on the Social Security Administration (SSA).
While some believe the main issue is fraud, experts say there is a bigger problem — overpayments.
Each year, the SSA mistakenly sends too much money to around 3 million beneficiaries. While this may seem like a small fraction of the total payments, it creates financial stress for those who receive these extra funds.
The SSA often demands repayment, sometimes years later, leaving recipients in debt for thousands of dollars they may not have.
DOGE could help fix these errors, preventing costly mistakes rather than going after beneficiaries for repayment.
The Burden of Overpayment Clawbacks
When SSA realizes it has overpaid someone, it requires them to return the extra money.
This process, called a clawback, can be financially devastating. Some beneficiaries end up owing tens of thousands of dollars without even knowing they were overpaid.
Even though overpayments account for less than 1% of Social Security’s total payouts, they still cause major problems.
Many beneficiaries struggle with sudden repayment demands, and the government also loses money in the process.
Experts believe the SSA needs better technology to track payments accurately.
“They need to modernize their system to prevent these overpayments in the first place,” said Devin Carroll, a certified financial planner.
DOGE and the Fight Over Social Security
The Biden administration has already tried to address overpayments, but concerns remain about how DOGE’s involvement will impact Social Security.
Some worry that instead of fixing the system, DOGE may push for cuts in funding or staff reductions.
Earlier this month, lawmakers and Social Security advocates gathered outside SSA headquarters, demanding that DOGE stay out of Social Security.
Former SSA commissioner Martin O’Malley warned against interference, saying, “Keep your hands off our Social Security.”
Security is also a major issue. SSA stores private financial and medical information. Concerns grew when SSA’s Acting Commissioner, Michelle King, resigned after refusing to give DOGE access to SSA’s data.
The White House has since appointed Leland Dudek as the new SSA leader until President Trump’s nominee, Frank Bisignano, is confirmed.
Dan Adcock from the National Committee to Preserve Social Security and Medicare explained why King opposed DOGE’s access to sensitive data.
“They have a history of secrecy and untrustworthiness. We don’t know how they will use this information,” he said.
The Real Fix: Better Technology and More Staff
One of the biggest reasons for SSA’s overpayment problem is outdated technology. SSA employees must manually enter changes, which leads to errors. With fewer workers now than ever before, processing delays are common.
Nancy Altman, president of Social Security Works, says that “understaffing is a major cause of these mistakes.”
She believes hiring more workers would reduce errors and speed up claims processing. Instead of cutting SSA’s budget, she suggests increasing funding to improve efficiency.
New technology could also help. If SSA could automatically track earnings and benefit changes in real-time, it could reduce overpayments before they become large debts.
Andrew Biggs, a senior fellow at the American Enterprise Institute, supports this idea. “If SSA used more data sources, they could catch overpayments before they get out of hand,” he said.
Bisignano, the nominee for SSA Commissioner, has a background in electronic payments, which could help modernize the system. “If SSA is anything, it’s a system that processes payments,” Carroll said.
Fear of a Return to Aggressive Clawbacks
Some worry that DOGE’s focus on efficiency could mean a harsher approach to collecting overpayments. In the past, SSA took 100% of a person’s Social Security check until the debt was repaid.
Under the Biden administration, new rules were introduced to limit repayment to 10% of a person’s check. Beneficiaries were also given more time to appeal or request payment plans. However, experts fear these protections could be removed.
“That rule could be reversed in an instant,” warned economist Laurence Kotlikoff. “Taking 100% of someone’s benefits can be devastating.”
Many beneficiaries have already shared horror stories of how overpayments affected them. One retiree, who budgeted carefully for retirement, received a letter saying he owed $15,000.
Despite multiple appeals, the SSA reduced his benefits to $0 until the debt was repaid. Another worker informed SSA about his temporary job, but SSA still overpaid him and later withheld his benefits even after he had returned the money.
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Will There Be Any Change?
Some experts believe SSA’s overpayment issues may improve due to recent policy changes. One major cause of overpayments was the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO), which reduced benefits for certain retirees.
A new law, the Social Security Fairness Act, eliminated WEP and GPO. This change means fewer beneficiaries will be mistakenly overpaid, potentially reducing the number of clawbacks.
“That should significantly lower the number of overpayments,” Carroll said.
The Bottom Line
While DOGE’s focus on Social Security raises concerns, one clear area for improvement is overpayment errors.
Preventing these mistakes with better technology and more staff could help beneficiaries avoid financial hardship and save the government money.
However, if DOGE pushes for aggressive clawbacks instead of fixing the system, millions of Americans could suffer.
The future of Social Security now depends on how the new administration chooses to handle this issue.
Disclaimer- Our team has thoroughly fact-checked this article to ensure its accuracy and maintain its credibility. We are committed to providing honest and reliable content for our readers.
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