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New Report Says Social Security Administration Failing to Distinguish Between the Living and Dead

 

(WASHINGTON, D.C.) – U.S. Senator Tom Coburn, M.D. (R-OK) released the following statement today regarding a new report from the Social Security Administration (SSA) Office of the Inspector General (OIG) that found that SSA failed to properly record the deaths of 1.2 million deceased beneficiaries on the Death Master File, which is exclusively maintained by the agency.[1]

 

“It is inexcusable the federal government can’t determine whether a recipient of federal taxpayer money is alive or dead. The importance of the Death Master File cannot be overstated. Failing to maintain this file costs taxpayers at least $120 million every year. Those are dollars we borrow here and overseas to pay dead people. That is embarrassing, especially when SSA is overseeing retirement and disability programs that are going bankrupt. Congress needs to hold SSA accountable for their breathtaking incompetence,” Dr. Coburn said.

 

The impact of SSA’s failure to properly record these deaths is widespread and results in millions of American tax dollars paid to dead people each year. All federal agencies are currently required to check the DMF to ensure the individuals receiving benefits are alive. In June 2010, President Obama directed that before the release of any federal funds all agencies were required to check the DMF.[2] SSA’s failure to maintain an accurate DMF also creates difficulties for the administration’s current effort to develop a “Do Not Pay solution” in response to the President’s directive, which includes all agencies checking a database of information from the DMF before a payment is made to an individual.[3]

 

The OIG report identified the following specific agencies that provide benefits directly to individuals by relying on the DMF: Railroad Retirement Board; Department of Defense; Office of Personal Management; Department of Veterans Affairs; and the Centers for Medicare and Medicaid Services.

 

Therefore, SSA’s failure to properly maintain information on whether an individual is alive or dead touches every payment made by the government. Past examples of government payments made to dead people include:

 

The Department of Agriculture sent $1.1 billion in farming subsidies to deceased farmers;

 

Medicare paid $92 million in claims for medical supplies prescribed by dead doctors and $8.2 million for medical supplies prescribed for dead patients; and

 

The Department of Health and Human Services sent 11,000 dead people $3.9 million in assistance to pay heating and cooling costs.[4]

 

Further exacerbating the problem, SSA allows the Department of Commerce to sell the DMF not only to public entities, but also private companies. Private entities, such as banks, hospitals, universities, and insurance companies, use the DMF to verify the identity of individuals and prevent fraud. The same SSA OIG report determined that since 2001, 1,556 dead people earned wages totaling about $158 million. While some of these could be errors, others potentially involved fraudsters using Social Security numbers of individuals that died up to 31 years ago.[5]

 

SSA OIG also found the failure to maintain the DMF produced inaccuracies in the E-verify program, which is used by employers to determine if a potential employee is authorized to work. The audit determined that when an individual’s death is not recorded by SSA in the DMF, E-verify indicated the individual claiming the Social Security number is legally able to work. As such, individuals who would otherwise be illegal to work can use Social Security numbers of dead people to appear to be legal to work.

 

In response to the report, Sen. Tom Coburn stated “The importance of the Death Master File cannot be overstated, especially in these bleak economic times with limited tax dollars to go around. At the bare minimum, the federal government needs to stop sending payments to dead people. If SSA cannot be trusted to properly and accurately maintain this important information, then Congress should determine if another agency can perform this basic function.”

 

Sen. Coburn previously called for SSA to improve its management of data on the deceased in October 2010, following the Internal Revenue Service sending $18 million in stimulus checks to 71,688 deceased individuals based on information in the DMF.[6] In response, Social Security Commissioner Michael Astrue responded: “Absent a report of death, it is extremely expensive and may even be impossible to determine if a person is alive or dead particularly if the person died many years ago.”[7]

 

[1] Social Security Administration, Office of Inspector General, Title II Deceased Beneficiaries Who Did Not Have Death Information on the Numident, Report A-09-11-21171 (July 9, 2012).

2 The White House, Office of the Secretary, Presidential Memorandum – Enhancing Payment Accuracy Through a “Do Not Pay List” (June 18, 2010), http://www.whitehouse.gov/the-press-office/presidential-memorandum-enhancing-payment-accuracy-through-a-do-not-pay-list.

3 Executive Office of the President, Office of Management and Budget, Memorandum for the Heads of Executive Departments and Agencies (April 12, 2012), http://www.whitehouse.gov/sites/default/files/omb/memoranda/2012/m-12-11.pdf.

4 Sen. Coburn previously reported that government agencies paid over $1 billion paid to dead people over a ten year period. See Sen. Tom Coburn, Federal Programs to Die For: American Tax Dollars Sent Six Feet Under (October 31, 2010), http://www.coburn.senate.gov/public//index.cfm?a=Files.ServeFile_id=406062be-b959-4798-b55e-39029197a9fc.

5 Social Security Administration, Office of Inspector General, Title II Deceased Beneficiaries Who Did Not Have Death Information on the Numident, Report A-09-11-21171 (July 9, 2012).

6 Sen. Tom Coburn, Federal Programs to Die For: American Tax Dollars Sent Six Feet Under (October 31, 2010), http://www.coburn.senate.gov/public//index.cfm?a=Files.ServeFile_id=406062be-b959-4798-b55e-39029197a9fc.

7 August 14, 2009 Letter from Social Security Commissioner Michael J. Astrue to Senator Tom Coburn.

 



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