Audit Finds SSA Did Not Pay an Estimated $291 Million in Underpayments Owed to SSI Recipients

Report highlights financial impacts on SSI beneficiaries due to delays in processing more than a million underpayments

The Social Security Administration (SSA) did not pay more than 1.1 million underpayments—totaling about $291 million—owed to eligible Supplemental Security Income (SSI) recipients or their survivors, according to a new report from the SSA’s Office of the Inspector General (OIG).

An underpayment occurs when (1) no payment is made for a period when payment was due; (2) the payment made was less than the amount owed for that period; or (3) a correct payment was issued, but the recipient died before they cashed the check.  When SSA identifies an underpayment of $1 or more, it issues the underpayment to the recipient, or an eligible survivor if the recipient is deceased, after it offsets any outstanding overpayments, Interim Assistance reimbursements, and authorized representative fees.  For large underpayments, employees must conduct and document a pre-payment review before they release a payment.

The audit examined two SSI underpayment populations and evaluated a total of 260 underpayments.  SSA OIG identified two populations: Population 1 comprised 2.5 million underpayments pending as of September 2024, and Population 2 comprised 2.4 million underpayments SSA paid between July 31, 2021, and July 31, 2024.  SSA OIG reviewed two samples totaling 260 underpayments (160 from Population 1 and 100 from Population 2).

Key Findings

• Among 160 pending underpayments sampled, SSA paid 50 percent correctly.  However, employees did not follow required policies for 43 percent of cases, and 7 percent were erroneous underpayments that SSA should remove from its records.
• The audit identified 47 underpayments for deceased recipients, totaling $22,861, that remained on SSA’s records even though they were not payable to anyone.
• In a second population of 100 paid underpayments, SSA conducted required prepayment reviews for 88 percent. For the remaining 12 percent, OIG found no evidence that SSA employees followed policy and completed the required prepayment reviews before issuing payments.

The report notes SSA employees must follow established procedures to ensure recipients receive payments to which they are legally entitled.  When underpayments are not released, individuals who rely on SSI may experience serious financial hardship.

“Our audit found gaps in policy adherence and documentation that could significantly affect vulnerable SSI recipients,” said Michelle L. Anderson, Assistant Inspector General for Audit as First Assistant.  “SSA has agreed with our recommendations and look forward to monitoring corrective actions.”

OIG recommended SSA:

·         Take appropriate action on the 139 underpayments identified in the audit;

·         Determine how to identify and resolve approximately 1.1 million outstanding underpayments for recipients or eligible survivors; and

·         Implement corrective actions to address employee errors and ensure required pre-payment reviews are properly documented.

SSA agreed to implement the recommendations.

Read the full report here.

Download a PDF of this news release here.