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“Clawback” of Social Security Benefits Still a Muddy Picture - MM+M

The term “clawback” is used to describe how Social Security demands repayment of improperly paid benefits – they “claw back” money already paid out. The term is sometimes used to describe how SS automatically takes back benefits paid for the month a beneficiary dies, because a recipient isn’t entitled to benefits for the month they pass (they must live the entire month to get benefits for that month). But “clawback” is also used to describe a much larger problem the Agency has – namely, that benefits are, apparently quite often, paid to those who became ineligible for them, resulting in Social Security issuing an Overpayment Notice.

The Overpayment Notice may result from the recipient of SS benefits exceeding the earnings limit imposed on those working and collecting SS before reaching their full retirement age; or it may occur because SS isn’t notified of a beneficiary’s death and continues to pay monthly benefits which are fraudulently used by a family member; or, perhaps, a divorced spouse remarries thus becoming ineligible for benefits from a former spouse. Whatever the reason, it’s a big problem for Social Security – to the tune of many billions of dollars in overpaid benefits, much of which cannot be recovered, and many of which induce severe financial hardship on unsuspecting beneficiaries. And, in many cases, the problem is exacerbated by Social Security’s own staffing issues. The problem is big enough that Congress recently grilled the Acting Commissioner of the Social Security Administration on it, but received some answers that appeared inaccurate. The picture about these SS collecting efforts and the impact on beneficiaries is, indeed, a muddy one, as explained in this “MM+M” (Medical Marketing and Media) article by David Hilzenrath and Jodie Fleischer. Click here to read more.

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