From the U.S. Government Accountability Office, www.gao.gov Transcript for: Social Security Administration Improper Disability Insurance Payments Description: Audio interview by GAO staff with Steve Lord, Director, Forensic Audits and Investigative Service Related GAO Work: GAO-13-635 Disability Insurance: Work Activity Indicates Certain Social Security Disability Insurance Payments Were Potentially Improper Released: September 2013 [ Background Music ] [ Narrator: ] Welcome to GAO's Watchdog Report, your source for news and information from the U.S. Government Accountability Office. It's September 2013. The Social Security Administration's Disability Insurance Program is intended to provide cash assistance for workers whose long-term disabilities limit their work activities. Improper overpayments can occur if beneficiaries perform disqualifying work activities that SSA does not detect. A team lead by Steve Lord, a director in Forensic Audit and Investigative Services team, recently examined disability insurance overpayments. GAO's Sarah Kaczmarek sat down with Steve to talk about what they found. [ Sarah Kaczmarek: ] What's the scope of the problem here in terms of dollars spent and number of people receiving improper payments? [ Steve Lord: ] It's important to note that the Social Security Administration's Disability Insurance Program is the nation's largest cash assistance program for workers with disabilities. In fiscal year 2011, more than 10 million beneficiaries received over 128 billion in benefits. This is a large program. In our report, we estimated that the Social Security Administration made about $1.29 billion in potential overpayments to about 36,000 individuals as of January 2013. [ Sarah Kaczmarek: ] And what's SSA doing to prevent making improper payments? [ Steve Lord: ] Well, they're doing several things. One key mechanism is the so-called continuing disability reviews generated through its enforcement efforts. The process involves matching SSA disability payments against IRS wage data to trigger alerts to help identify cases that exceeds best-buy earnings threshold. Self reporting is also required under the program—disability payment beneficiaries are required to report increases in their earnings to SSA. [ Sarah Kaczmarek: ] And have they had any success with those strategies? [ Steve Lord: ] Yes, they've had some success, but they're by no means perfect. Our report identified numerous examples where an earnings alert was generated but not acted upon in a timely manner by SSA. For example, we identified a few cases where individuals earned potential overpayments of thousands of dollars and one notable example we identified an individual made $90,000 in potential overpayments. [ Sarah Kaczmarek: ] We're talking about over a billion dollars in potential improper payments here. What's GAO recommending be done? [ Steve Lord: ] Well, we believe they need to improve their enforcement and oversight efforts, particularly as they deal with the so-called wait period. Under program rules, you're required to wait 5 months before receiving benefits, yet we noted though our work there's people earning substantial earnings, that is earnings over a thousand dollars during that mandatory 5-month waiting period, which concerns us. So we think they need to develop better mechanism to identify work activity during all months of the waiting period. Especially when the wait period occurs in a year before the benefits are actually paid. We identified a slight glitch in their process where they had difficulty identifying those cases. [ Sarah Kaczmarek: ] Finally, for taxpayers concerned with improper payments, what's the bottom line here? [ Steve Lord: ] Well, the bottom line is this. This is a really important program for deserving beneficiaries—those truly in need and those that are disabled. At the same time, the Social Security Administration—they need to enhance their oversight efforts to ensure that only eligible beneficiaries receive benefits. The reason this is important is there's a growing concerns about the solvency of the disability trust fund. As we note in our report, the Social Security Board of Trustees projects that the disability trust fund will be exhausted in the year 2016. Thus, enhanced oversight, such as we're recommending is needed to help ensure these precious taxpayer funds are spent as intended. [ Background Music ] [ Narrator: ] To learn more visit GAO.gov and be sure to tune in to the next episode of GAO's Watchdog Report for more from the Congressional Watchdog, the U.S. Government Accountability Office.