The Social Security Administration (SSA) has introduced a new cost-cutting plan to lower operational expenses and enhance efforts to combat identity fraud.
On March 19, the SSA revealed a three-phase strategy to cut costs and improve the Electronic Consent Based Social Security Number Verification (eCBSV) service.
This service allows businesses and government agencies to verify Social Security numbers more efficiently.
Why It Matters?
The SSA’s new measures align with President Donald Trump’s broader push to reduce government spending and eliminate inefficiencies.
The Department of Government Efficiency (DOGE), created during Trump’s administration, has been identifying areas to cut budgets across federal agencies.
With over 71 million Americans depending on Social Security, the SSA has faced increasing financial pressure, criticism over high administrative costs, and delays in processing claims.
Key Details
The first phase of the plan aims to cut the eCBSV system’s costs by 40% and reduce annual fees for participating businesses by 25%.
The SSA is also working to improve the accuracy of no-match results to help businesses and agencies make better decisions.
A future phase will explore merging the Consent Social Security Number Verification (CBSV) system with eCBSV, which would streamline operations and expand access to the service.
To keep stakeholders involved, the SSA plans to hold regular meetings with industry representatives and government partners, gathering feedback to improve the eCBSV service.
In addition to the eCBSV changes, the SSA has announced other cost-cutting measures:
- Staff Reductions: The agency plans to reduce its workforce from 57,000 to 50,000 through early retirements and buyouts.
- Office Closures: Partnering with the General Services Administration (GSA), the SSA will close several non-public and field offices, saving about $4 million annually.
- IT and Contracting Cuts: Canceling nonessential IT contracts will save about $150 million.
- Travel and Grants: Travel expenses will be reduced by 70%, and cuts to contracts and grants are expected to save an additional $30 million.
- Overpayment Recovery: The SSA is reinstating a policy requiring full repayment of overpaid Social Security benefits.
Public Response
Megan A. Curran, policy director at the Center on Poverty and Social Policy at Columbia University, highlighted the importance of Social Security, noting that it kept nearly 30 million people out of poverty in 2023, most of them seniors.
She warned that cuts to benefits could have serious financial consequences for millions of Americans.
Lee Dudek, acting commissioner of the SSA, said the agency is committed to improving the eCBSV service to better serve stakeholders and reduce identity fraud.
Political figures have voiced mixed reactions:
- Senator Raphael Warnock criticized recent SSA office closures in Georgia, calling it an intentional effort to block seniors from accessing benefits.
- Congressman Tim Burchett supported the cuts, suggesting they could reduce waste and free up more funds for seniors.
- Mark Cuban sarcastically praised the move, saying it forces seniors to adapt to online services and could ultimately reduce payments.
- Congressman Mike Levin accused Elon Musk of trying to undermine Social Security, warning it could make it harder for Americans to access their benefits.
What’s Next?
The SSA will begin implementing the plan immediately.
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