The Social Security Administration (SSA) is reinstating a policy that left some Americans drowning in debt – through no fault of their own.
The agency is reinstating a plan to recover 100 percent of overpayments to beneficiaries.
For decades, the SSA withheld 100 percent of a recipient’s benefits if it determined they had been overpaid.
In March 2024, the Biden-appointed commissioner changed that policy, capping the withholding rate at 10 percent of a recipient’s monthly check.
Officials at SSA argued that the sudden, complete loss of benefits placed an undue burden on older Americans.
Some beneficiaries were even lumped with surprise bills for thousands of dollars when the agency clawed back overpaid funds it had sent in error.
Now, the SSA is reverting to its previous policy.
Beginning March 27, recipients who are paid the incorrect amount will see their benefits cut off until the agency has recuperated the lost funds.
SSA officials are reverting to an older policy to recuperate money it incorrectly sent
‘We have the significant responsibility to be good stewards of the trust funds for the American people,’ Lee Dudeck, the acting commissioner of the SSA, said in a statement.
‘It is our duty to revise the overpayment repayment policy back to full withholding, as it was during the Obama administration and first Trump administration, to properly safeguard taxpayer funds.’
The SSA is legally required to recoup overpayments, but its previous attempt at full repayment enforcement sparked a wave of horror stories.
Beneficiaries were suddenly hit with demands to return tens of thousands of dollars within 30 days, even when the overpayments were caused by SSA errors.
Senior advocates say they support changes to ensure that SSA recipients receive the correct allotment of cash.
However, they believe the change will directly harm older Americans who are already struggling with inflated consumer prices.
‘Many beneficiaries may not be aware of an overpayment and could suddenly find themselves without a check,’ Shannon Benton, the executive director of the Senior Citizens League, a non-partisan advocacy group for senior Americans, told Daily Mail in a written statement.
‘The time between notification and recoupment should be extended, and we hope that some Members of Congress will have the courage to reintroduce the Social Security Overpayment Fairness Act.’
The Social Security Overpayment Fairness Act, introduced in May 2024, would have given recipients a 120-day grace period before the government could have started clawing back overpaid benefits.
The bill received Republican and Democratic co-sponsors, but hasn’t made it out of the House Ways and Means committee.
The new policy could see elder Americans lost their SSA checks for a long period
Advocates say the former policy put thousands of Americans into debt
The SSA has been central in the Trump administration’s efforts to cut government waste.
In his 99-minute address to Congress, the President claimed the SSA is losing money to citizens who have been dead for decades.
‘Now, we’re going to get fraud out of there,’ he told the chamber.
‘We have people 250 years old and all, you know, tremendous fraud.’
Still, the agency has admitted to sending too much money to its recipients.
The SSA’s Office of the Inspector General released a report in July 2024 that claimed it sent $71.8 billion of incorrect payments between 2015 and 2022.
That is less than 1 percent of the agency’s $8.6 trillion payments in that time.
SSA believes it will send out $1.6 trillion in benefits in 2025.
