The U.S. Department of the Treasury has successfully recovered $31 million in improper payments made by Social Security to deceased individuals. This recovery was made possible through a pilot program initiated under the 2021 omnibus appropriations bill, granting the Treasury temporary access to the Complete Death Master File maintained by the Social Security Administration (SSA).
This database, with records dating back to 1899, is the most comprehensive resource for identifying deaths, ensuring accurate record-keeping, and preventing erroneous payments. According to David Lebryk, Treasury’s fiscal deputy secretary, this pilot program marks the start of a larger effort to reduce errors and safeguard public funds.
Causes of Improper Payments
Although improper payments represent a small percentage of Social Security disbursements, they can have significant financial impacts due to the scale of the system. These errors stem from:
- Delays in reporting deaths: Family members, funeral homes, or medical institutions often fail to notify the SSA promptly.
- Errors in record updates: Data transfer or processing issues can prevent the SSA from promptly recording deaths in its systems.
- Automatic payments: Social Security benefits are frequently issued via direct deposit. If a death goes unrecorded before processing, the payment is automatically sent.
Recovery of Improper Payments
When an improper payment is identified, the SSA takes steps to recover the funds:
- Bank return: For direct deposits, banks are required to freeze the funds and return them to the SSA.
- Family notification: If the funds have already been withdrawn, the SSA contacts the deceased’s family or heirs, requesting reimbursement for improperly received payments.
Call for Long-Term Solutions
Deputy Secretary Lebryk has urged Congress to grant permanent access to the Death Master File. Such access would enhance the Treasury’s ability to detect deaths efficiently, prevent improper payments, and reduce fraud. Additionally, a long-term solution would bolster trust in the Social Security system and ensure responsible management of public resources.
Lessons Learned
The experience highlights key areas for improvement:
- Updated Databases: Keeping databases current and accessible across government institutions is essential to prevent errors.
- Collaboration: Enhanced cooperation between government agencies, families, and stakeholders is critical for timely reporting of deaths.
Future Impact
Recovering $31 million is just the beginning. The Treasury aims to recoup $215 million in improper payments, but the success of this initiative depends on:
- Legislative cooperation: Permanent access to crucial databases is necessary for efficient operations.
- Improved systems: Investments in technology and better data management can significantly reduce errors.
This effort not only saves taxpayer money but also strengthens public confidence in Social Security and the broader tax system by ensuring public funds are used responsibly and fairly.
FAQs
What is the Death Master File?
A comprehensive SSA database used to record deaths and prevent improper payments.
Why do improper payments happen?
Delays in reporting deaths, errors in records, and automatic payments.
How does the SSA recover funds?
By freezing bank accounts or contacting families for reimbursement.
How much has the Treasury recovered so far?
$31 million in improper Social Security payments.
What is the Treasury’s long-term goal?
To recover $215 million and reduce errors with better systems.
