USDA Paid ‘Improper’ Subsidies To 1,799 Dead Farmers And Proper Ones To 28,613 Dead Farmers

USDA Paid ‘Improper’ Subsidies To 1,799 Dead Farmers And Proper Ones To 28,613 Dead Farmers – CNS

The U.S. Department of Agriculture made farm subsidy payments to 28,613 dead farmers between 2011 and 2012, of which 1,799 were deemed “improper,” according to a Government Accountability Office (GAO) report issued in June.

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The report, entitled “USDA Needs to Do More to Prevent Improper Payments to Deceased Individuals,” said USDA’s Farm Service Agency identified “thousands of deceased individuals who were paid $3.3 million in improper payments after their dates of death, of which FSA has recovered approximately $1 million.”

GAO determined that about 6 percent of the total subsidy payments should not have been sent due to clerical errors or outright fraud.

An FSA spokesperson told CNSNews.com that most farm subsidy payments made by the USDA are based upon the farmer fulfilling his contractual obligation; for example, participating in a farmland conservation program. In the event of the farmer’s death, payments would be made to the farmer’s survivors or corporate successor.

“Improper payments” are those sent to individuals who had not properly filed documentation and who had subsequently died, or sent to relatives who had filled out the documentation and signed it on behalf of the farm’s now-deceased owner — something not permitted under FSA regulations. Most of those cases involve a legitimate error, the spokesman added, but some are fraudulent.

The FSA distributes $20 billion annually in farm subsidies to roughly 1 million individuals, averaging about $20,000 per person. Approximately $7.4 billion is spent on farm commodity and conservation programs; another $4 billion goes for financial and technical assistance; and $8.3 billion is spent to cover roughly 60 percent of farmers’ crop insurance premiums.

To prevent future subsidy payments to dead farmers, the GAO recommended that the Secretary of Agriculture implement procedures to match crop insurance records with the Social Security Administration’s master death file, ensure that all subsidy payments are “supported by documentation,” and review “each subsidy provided on behalf of a deceased individual to ensure that an improper subsidy was not made.”

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$7.9B In Improper Social Security Payments Last Year… But The Sequester Will Destroy America

$7.9 Billion In Improper Social Security Payments In FY 2012 – CNS

The Social Security Administration (SSA) needs to focus on “program integrity,” a polite term for reducing fraud and payment errors, the agency’s inspector general told Congress last week.

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Reducing improper payments is one of the challenges facing the next SSA commissioner, Patrick O’Carroll, Jr., the agency’s inspector general, told the House Ways and Means Subcommittee on Social Security on April 26.

In fiscal year 2012, the Social Security Administration reported $4.7 billion in improper payments in the Supplemental Security Income (SSI) program, a 9.2 percent improper payment rate. (SSI is funded by general tax revenues, not payroll taxes. It helps elderly, blind, and/or disabled people who are poor.)

SSA reported $3.2 billion in the Old-Age, Survivors’ and Disability Insurance (OASDI) program, a 0.4 percent improper payment rate. (OASDI, funded by payroll taxes, is what people generally refer to as “Social Security.”)

That’s a total of $7.9 billion, and it includes some underpayments as well as overpayments.

“SSA’s improper payments largely consist of those erroneously made to ineligible individuals,” O’Carroll said.

“Improper benefit payments occur for many reasons.” Fraud is one reason, he said. This includes beneficiaries who do not tell the agency about changes in their income, resources or living arrangements, which would change the amount Social Security pays them. O’Carroll also mentioned recipients’ “poor understanding of reporting responsibilities,” and administrative errors.

“For many years, my office has encouraged SSA to balance service initiatives, such as processing new claims, with stewardship responsibilities, such as conducting timely work and medical (disability reviews) and SSI redeterminations, to ensure that individuals remain disabled and eligible, and cease payments to those who do not.”

Soaring disability claims are a particular concern for the Social Security Administration.

In his opening statement, subcommittee Chair Rep. Sam Johnson (R-Texas) said application for disability benefits, triggered by the recession and the weak recovery, have never been higher: “Since 2010, the average number of people filing for disability benefits is just over 249,000 a month,” Johnson said. “At the same time the average number of new jobs created is almost 148,000 each month.”

O’Carroll told the panel he would like to see SSA perform more work-related “continuing disability reviews,” or CDRs, to make sure people collecting disability aren’t working on the side.

SSA estimates that every dollar spent on medical CDRs yields about $9 in SSA program savings over 10 years. Reducing the complexity of Social Security’s disability programs could also streamline operations and reduce millions of dollars in payment errors each year, O’Carroll said.

SSA said it conducted 443,233 medical disability reviews in FY2012, up from 345,000 in FY2011, but the disability review backlog still stands at 1.2 million.

SSA has set a goal of conducting 435,000 medical disability reviews in FY2013, based on the current level of funding. Beneficiaries with a high likelihood of medical improvement undergo a medical review; Beneficiaries with a lower likelihood of medical improvement are mailed a questionnaire, which may or may not trigger a medical review.

Reexamination or “redetermination” of SSI retirement benefits also is effective in reducing overpayments in the SSI program, O’Carroll said. Because SSI is a means-tested program, any change in recipients’ income, living arrangements, or marital status can affect eligibility or payment amount.

SSA reported that it saves $5 for every $1 spent on SSI redeterminations. SSA completed more than 2.4 million redeterminations in FY2011 and 2.6 million in FY2012, and it plans to conduct more than 2.6 million in FY2013. Not every SSI recipient undergoes a redetermination every year; SSA uses a statistical scoring model to identify which cases it will examine.

O’Carroll said his office has encouraged SSA to use data matching with other governmental agencies to detect improper payments. He said SSA also should use more non-governmental databases in doing the redeterminations.

SSA paid more than $800 billion in SSI and OASDI benefits to more than 60 million Americans in FY2012. It estimates that over the next 20 years, another 80 million individuals will retire and file for Social Security benefits.

The hearing was called to discuss the challenges facing the next Social Security commissioner. Michael J. Astrue’s six-year term expired on Jan. 19, 2013, and his successor — once President Obama nominates one – must be confirmed by the Senate.

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Government Doled Out $10.3 Billion In Improper Unemployment Payments In 2012

Government Doled Out $10.3 Billion In Improper Unemployment Payments In 2012 – CNS

The Federal-State Unemployment Insurance program paid out $10.3 billion in benefits in 2012 to people who should not have received the money, according to the Department of Labor (DOL).

The data provided on the government website, paymentaccuracy.gov, shows those payments amount to 11.42 percent of all the unemployment insurance checks handed out – an increase from 11.36 percent in 2011 and in excess of the government’s “target” for overpayments of 9.66 percent.

The DOL states that most of the data reported on its paymentaccuracy website was for the federal government’s fiscal year, which runs from Sept. 30 to Oct. 1, but that some data may have come from calendar year tabulations, which is why the department “used the term fiscal reporting year to best describe the time period in which the most current information was reported.”

The data also show that improper unemployment insurance payments increased steadily between 2009 and 2012, from 10.3 percent to 12 percent, respectively.

That percentage dropped 0.6 percent between 2011 (12 percent) and 2012 (11.4 percent), according to the DOL, which consequently forecasts that improper payments will fall below 10 percent in 2013 and 2014.

As reported by CNSNews.com, statistics released by DOL show that of the $10.3 billion in improper payments, the states improperly paid more than $5 billion for the period July 1, 2011 to June 30, 2012. (See DOL spread sheet on states payments.xls)

The “program contents” portion of the website states that 70 percent of the $10.3 billion that was paid out in 2012 was done so through one of three scenarios: “individuals did not meet their active work search requirements, continued to claim UI benefits after they had returned to work, or were ineligible for benefits because they voluntarily quit their jobs or were discharged for misconduct.”

An estimated 2.85 percent of state and federal improper unemployment payments were the result of fraud, according to the DOL.

The government website states that unemployment “helps cushion the impact of economic downturns and brings economic stability to communities, states, and the nation by providing temporary income support for laid off workers.”

The website also promotes the government’s efforts to end this trend.

“The reduction of improper payments in the UI program is a top priority of the Department of Labor,” the website states.

And the government is spending more money to that end.

“In fiscal year 2012 the Department awarded $169.9 million in supplemental funding to 33 states for the prevention, detection, and recovery of improper UI benefit payments; improve state performance; address outdated Information Technology (IT) system infrastructures necessary to improve UI program integrity; and enable states to expand or implement Reemployment and Eligibility Assessment (REA) programs,” the website states.

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