DISABILITY 

INSURANCE

SSA Could Do More 

to Prevent 

Overpayments or 

Incorrect Waivers to 

Beneficiaries

Report to the Subcommittee on Social

Security, Committee on Ways and

Means, House of Representatives

October 2015

GAO-16-34

United States Government Accountability Office
 United States Government Accountability Office 

Highlights of GAO-16-34, a report to the

Subcommittee on Social Security, Committee 

on Ways and Means, House of 

Representatives

October 2015

DISABILITY INSURANCE

SSA Could Do More to Prevent Overpayments or 

Incorrect Waivers to Beneficiaries 

Why GAO Did This Study 

SSA’s DI program provides cash 

benefits to workers with disabilities. 

Per program rules, SSA requires that 

beneficiaries promptly report their work 

activity—including starting a job or a 

change in wages—as failure to do so 

may result in an overpayment that 

must be repaid. In fiscal year 2014, 

SSA identified $1.3 billion in DI benefit 

overpayments. Avoiding overpayments 

is imperative as they pose a burden for 

beneficiaries who must repay excess 

benefits and result in lost taxpayer 

dollars if they are not repaid or are 

waived by SSA. GAO was asked to 

review SSA’s handling of DI 

overpayments and waivers due to 

beneficiaries’ return to work.

This report examines 1) the extent of 

work-related DI overpayments and 

waivers, 2) how SSA’s handling of 

work activity reported by beneficiaries 

prevents overpayments, and 3) how 

SSA ensures appropriate decisions are 

made to waive overpayments. GAO 

analyzed 10 years of SSA data on 

overpayments and waivers; reviewed 

relevant laws, regulations, guidance 

and studies; interviewed staff at SSA 

headquarters and several field offices 

and teleservice centers, selected to 

represent a range of relevant DI 

workloads; and reviewed 10 DI cases 

involving waived overpayments. 

What GAO Recommends 

GAO is making seven 

recommendations, including that SSA 

study automated reporting options, and 

improve oversight of work reports and 

waivers. SSA agreed with six 

recommendations but disagreed with 

overseeing work reports. GAO clarified 

that oversight should ensure staff are 

following proper procedures.

What GAO Found 

From fiscal years 2005 through 2014, GAO found that Social Security 

Administration (SSA) overpaid $11 billion in Disability Insurance (DI) program 

benefits to beneficiaries who had returned to work and had earnings above 

program limits, and about $1.4 billion in overpayments related to work activity 

was waived—because the beneficiary was found not at fault—and therefore will 

not be repaid. SSA recently conducted two reviews to identify the extent of 

overpayments caused by errors in processing work reports; however, both 

reviews used sample sizes too small to produce reliable results—limitations 

which SSA did not note in its reports and that may impede SSA’s understanding 

of root causes of overpayments. 

SSA’s process for handling work reports by beneficiaries has internal control and 

other weaknesses that increase the risk of overpayments, even when DI 

beneficiaries follow program rules and report work and earnings, including: 

 Processing weaknesses. Due in part to unclear guidance, GAO found that

SSA staff may bypass established procedures and not: (1) initiate tracking of

work activity, which would help prevent overpayments; and (2) issue a

receipt to the beneficiary—as required by law—that proves the beneficiary’s

work was reported. Data are not available to determine the full extent to

which this might occur.

 Limited oversight. While SSA tracks timeliness of staff action on work

reports, it lacks procedures for how staff should screen such reports, and for

ensuring that work reports are systematically reviewed and closed with

appropriate action.

 No automated reporting options. In contrast to SSA’s Supplemental

Security Income (SSI) program—a means-tested disability benefits

program—the DI program lacks automated tools to report work, such as an

automated telephone system and a smart phone app. Although SSA officials

said there is an internal proposal to automate DI work reports, they could not

provide specifics on how or when this would occur. Without automation,

SSA’s current manual approach is vulnerable to error.

SSA’s processes for handling requests to waive overpayments lack sufficient 

controls to ensure appropriate decisions are made, especially those involving low 

dollar amounts. Two recent reviews—conducted by SSA and SSA’s Office of 

Inspector General (OIG)—found documentation and other errors in DI and other 

waivers. In addition, a 2015 OIG study found significant variation in DI and other 

waiver approval rates among field offices, and noted that some field offices with 

high waiver approval rates also had a high incidence of waivers under $1,000, 

which require less documentation. In response to the reviews, SSA has already 

taken some steps to improve waiver policy and training. Nevertheless, SSA’s 

reviews do not target DI waiver decisions—especially those under $2,000, which 

do not require supervisory review and comprise almost a third of all waiver 

decisions. Without additional oversight, such as targeted reviews of DI waivers, 

staff may systematically waive overpayments incorrectly, particularly those 

involving low dollar amounts. 

View GAO-16-34. For more information, 

contact Daniel Bertoni at (202) 512-7215 or 

bertonid@gao.gov.
Page i GAO-16-34 Disability Insurance 

Letter 1

Background 3

Many DI Overpayments and Waivers Are Due to Beneficiary 

Earnings Exceeding Program Limits 10

SSA’s Processes and Complex Program Rules May Contribute to 

Overpayments 14

Weaknesses Undermine SSA’s Handling of Overpayment Waivers 24

Conclusions 28

Recommendations for Executive Action 29

Agency Comments and Our Evaluation 30

Appendix I Comments from the Social Security Administration 33

Appendix II GAO Contacts and Staff Acknowledgments 41

Table 

Table 1: Social Security Administration Procedures for Title IIa

Waiver Approval by Waiver Amount 24

Figures 

Figure 1: Social Security Administration Procedures for 

Processing DI Beneficiary Work Reports 6

Figure 2: Social Security Administration Procedures for 

Processing DI Beneficiary Waiver Requests 8

Figure 3: Social Security Disability Insurance Overpayments: Total 

Dollar Amount and Percent Due to Earnings Exceeding 

Program Limits, Fiscal Years 2005 through 2014 11

Figure 4: Social Security Disability Insurance Waivers: Total Dollar 

Amount and Percent Due to Earnings Exceeding 

Program Limits, Fiscal Years 2005 through 2014 12

Contents
Page ii GAO-16-34 Disability Insurance 

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Page 1 GAO-16-34 Disability Insurance 

441 G St. N.W.

Washington, DC 20548

October 29, 2015 

The Honorable Sam Johnson 

Chairman 

The Honorable Xavier Becerra 

Ranking Member 

Subcommittee on Social Security 

Committee on Ways and Means 

United States House of Representatives 

The Disability Insurance (DI) program is one of the nation’s largest cash 

assistance programs for workers with disabilities. In fiscal year 2014, 

about 11 million individuals with disabilities and their dependents received 

approximately $143 billion in DI benefits. During the same year, the 

Social Security Administration (SSA) reported detecting $1.3 billion in 

new DI benefit overpayments,1

 which occur when SSA pays benefits in 

excess of what is due, or continues to pay those who are no longer 

eligible. Overpayments often result when beneficiary work and earnings 

activity—which can affect program eligibility—is not properly reported to 

or processed by SSA. Overpayments can pose a financial hardship for 

beneficiaries responsible for repaying the debt. Overpayments may also 

result in the loss of taxpayer dollars, either because beneficiaries do not 

repay their debts or because they are eligible to have their overpayment 

debts waived by SSA. Further, overpayments in the DI program can 

contribute to the weakened financial status of the DI trust fund, which the 

Social Security Board of Trustees projects will be exhausted in 2016.2

 In 

addition, researchers and others have noted that the potential for 

1SSA provided GAO summary data on new DI beneficiary debt detected each fiscal year 

for fiscal years 2005 through 2014. SSA cites the source of these data as the agency’s 

fourth quarter report for the Treasury Report on Receivables (TROR) for each fiscal year. 

SSA officials informed us that the TROR report does not include what SSA characterizes 

as non-legally defined overpayments, such as benefits issued for the month of death. 

2The Board of Trustees, Federal Old-Age and Survivors Insurance and Federal Disability 

Insurance Trust Funds, The 2015 Annual Report of the Board of Trustees of the Federal 

Old-Age and Survivors Insurance and Federal Disability Insurance Trust Funds. 

(Washington, D.C.: July 22, 2015). 

Letter
Page 2 GAO-16-34 Disability Insurance 

overpayments due to earnings may also create a disincentive to 

beneficiaries who might otherwise wish to work.3

You asked us to review SSA’s handling of DI overpayments due to 

beneficiaries’ return to work, and its policies for waiving overpayments. 

This report addresses the following questions: (1) what is the extent of DI 

overpayments and waivers related to beneficiary work activity; (2) how 

does SSA’s handling of work activity reported by beneficiaries prevent 

overpayments, and (3) how does SSA ensure appropriate decisions are 

made to waive overpayments? To examine these issues, we reviewed 10 

years of SSA data (from fiscal year 2005 through 2014) on overpayment 

debt identified, collected, or written off—that includes waivers and 

overpayments for which collection activities have been terminated. We 

reviewed relevant federal laws, regulations, and guidance. In addition, we 

identified agency policies and procedures for processing work reports and 

making overpayment waiver decisions, and assessed these against 

federal internal control standards.4

 We also identified management 

strategies and tools used to oversee these processes, and assessed 

them against federal internal control standards. We examined prior 

relevant reviews by SSA, GAO and SSA’s Office of Inspector General, 

interviewed managers and staff in SSA headquarters and at several 

offices in three regions,5

 selected to reflect a range of workloads, and 

3See The Social Security Administration’s Employment Support Programs for Disability 

Beneficiaries, 111th Cong. 24-25 (2009)(statement of Cheryl Bates-Harris, Senior 

Disability Advocacy Specialist, National Disability Rights Network, on behalf of the 

Consortium for Citizens with Disabilities Employment and Training Task Force and Social 

Security Task Force) and Gina A. Livermore, Cornell Center for Policy Research, Wage 

Reporting and Earnings-Related Overpayments in the Social Security Disability Programs: 

Status, Implications, and Suggestions for Improvement, a report prepared at the request 

of Ticket to Work and Work Incentives Advisory Panel, Social Security Administration, 

May 5, 2003. 

4Standards for Internal Control in the Federal Government, GAO/AIMD-00-21.3.1

(Washington, D.C.: November 1999). 

5We interviewed staff and managers at two field offices, one program service center, and 

one teleservice center in each of the following three regions: Baltimore, Chicago, and San 

Francisco. At field offices, we spoke with managers, supervisors, technical experts, 

service representatives, and claims representatives. At teleservice centers, we spoke with 

managers, supervisors, and teleservice representatives. At program service centers, we 

spoke with managers, supervisors, and benefits authorizers who handled 800 calls as 

“spikes” during periods when demand spiked. We also spoke with managers, analysts, 

and area work incentives coordinators at area offices that provide oversight over selected 

field offices. 
Page 3 GAO-16-34 Disability Insurance 

spoke with representatives of a national disability rights association and 

four of its member groups that assist disability beneficiaries. We also 

analyzed work report, overpayment and waiver records from a 

nongeneralizable sample of 10 randomly selected case files. We selected 

these files from a dataset of beneficiaries who had an overpayment 

established in fiscal year 2013 and who requested a waiver of that 

overpayment.6

 Finally, we assessed the reliability of the eWork and 

Recovery of Overpayments, Accounting and Reporting (ROAR) data—

used to select our case files and to analyze trends in overpayments and 

waivers—by (1) performing electronic testing of required data elements, 

(2) reviewing existing information about the data and the system that 

produced them, and (3) interviewing agency officials knowledgeable 

about the data. We determined that the data were sufficiently reliable for 

the purposes of this report. 

We conducted our work from August 2014 to October 2015 in accordance 

with generally accepted government auditing standards. Those standards 

require that we plan and perform the audit to obtain sufficient, appropriate 

evidence to provide a reasonable basis for our findings and conclusions 

based on our audit objectives. We believe that the evidence obtained 

provides a reasonable basis for our findings and conclusions based on 

our audit objectives. 

The DI program was established in 1956 to provide monthly cash benefits 

to individuals unable to work because of severe long-term disability. To 

meet the definition of disability under the DI program, an individual must 

have a medically determinable physical or mental impairment that (1) has 

lasted or is expected to last at least 1 year or to result in death and (2) 

prevents the individual from engaging in substantial gainful activity 

(SGA).7

 In addition, to be eligible for benefits, workers with disabilities 

must have a specified number of recent work credits under Social 

Security when they acquired a disability.8 Spouses and children of 

6

In addition, we stratified the dataset into five levels of overpayment amounts—$1,000 or 

less, $1,001 to $2,000, $2,001 to $20,000,$20,001 to $75,000, and over $75,000—and 

selected two cases from each stratum. We used data on overpayments established in 

fiscal year 2013 to increase the likelihood that decisions on waiver requests would be 

completed by the time of our review. 

7

42 U.S.C. § 423(d). Substantial gainful activity is defined as work that involves doing 

significant and productive physical or mental duties for pay or profit. 20 C.F.R. § 404.1510. 

8

42 U.S.C. § 423(c). 

Background
Page 4 GAO-16-34 Disability Insurance 

workers may also receive benefits.9 Benefits are financed by payroll taxes 

paid into the DI Trust Fund by covered workers and their employers, and 

the benefit amount is based on a worker’s earnings history.10 In June 

2015, the program’s average monthly benefit for disabled workers was 

$1,165. Individuals eligible for DI benefits may also qualify for 

Supplemental Security Income (SSI), which provides cash assistance for 

eligible aged, blind, and disabled individuals with limited financial means. 

In June 2015, 1.6 million people with disabilities under age 65 received 

both DI and SSI benefits, and are referred to as concurrent 

beneficiaries.11

Historically, very few DI beneficiaries have left the program to return to 

work with earnings above the SGA level. To encourage work, the DI 

program offers various work incentives intended to safeguard cash and 

health benefits while a beneficiary tries to return to work. For example, 

the trial work period allows DI beneficiaries to work for a limited time 

without their earnings affecting their disability benefits.12 The trial work 

period begins when the beneficiary’s earnings are more than $780 per 

month. When the beneficiary has accumulated 9 such months within a 

period of 60 consecutive months, the trial work period is completed. After 

the trial work period ends, the 36-month extended period of eligibility 

begins, during which a beneficiary is entitled to benefits so long as he or 

she continues to meet the definition of disability and his or her earnings 

are below the SGA monthly earnings limit.13

SSA regulations require all DI beneficiaries to promptly notify SSA: when 

their condition improves, or they return to work or when they increase the 

amount they work or the amount of their earnings.14 SSA policy directs DI 

beneficiaries to report to SSA if work starts or stops; if duties, hours, or 

9

42 U.S.C. § 402. 

1042 U.S.C. § 401(b). 

11Social Security Administration, Monthly Statistical Snapshot, (Baltimore, Maryland: June 

2015). 

1220 C.F.R. § 404.1592. 

1320 C.F.R. § 404.1592a. SSA’s regulations refer to this as the re-entitlement period. The 

SGA monthly earnings limit in 2015 is $1,090 ($1,820 for blind beneficiaries). 

1420 C.F.R. § 404.1588(a). 
Page 5 GAO-16-34 Disability Insurance 

pay change; or they stop paying for items or services needed for work 

due to a disability.15 Beneficiaries may report work-related changes by 

fax, mail, phone, or in person at an SSA field office, or by calling SSA’s 

800 teleservice line. SSA staff are required by law and regulation to issue 

a receipt acknowledging that the beneficiary (or representative) has given 

SSA information about a change in work or earnings, and documenting 

the date that SSA received the work report.16 After receiving information 

about work activity or a pay stub from a beneficiary, SSA staff have 5 

days to input the information into SSA’s eWork17 system—which creates a 

pending work report or pay stub report—and provide a receipt to the 

beneficiary.18 Staff then have an additional 30 days to review the pending 

work report to determine if additional action is needed, such as a work 

continuing disability review (CDR),19 to assess the beneficiary’s continued 

eligibility for DI benefits. In fiscal year 2014, SSA processed over 242,000 

work reports or pay stubs, filed by over 100,000 beneficiaries. 

15POMS DI 13010.020B. 

1642 U.S.C. § 902, note; 20 C.F.R. § 404.1588(b). 

17 In 2004, SSA implemented the eWork system, which is the primary system for capturing 

beneficiary work-related information and processing work CDR cases in headquarters and 

field locations. 

18SSA policy directs staff to give or mail the receipt immediately if beneficiary work reports 

are made in person or by phone; for mailed or faxed reports, or reports delivered to the 

field office, staff are directed to input the information into the system and mail the receipt 

within 5 days of receipt of the information. POMS DI 13010.020C. 

19Work CDRs are reviews of beneficiary earnings to determine continued eligibility for 

benefits. These reviews typically involve SSA staff querying centralized agency data 

systems to identify earnings, sending forms to a beneficiary requesting information about 

work activity and earnings that may affect eligibility for DI benefits, contacting employers 

to verify earnings amounts, and assessing other factors such as employer subsidies and 

impairment-related work expenses. 
Page 6 GAO-16-34 Disability Insurance 

Figure 1: Social Security Administration Procedures for Processing DI Beneficiary 

Work Reports 

a

If a work report is prepared while the beneficiary waits in person or on the phone, SSA’s Program 

Operations Manual System (POMS) requires that the beneficiary be given or mailed a receipt 

immediately. 

Benefit overpayments can occur when beneficiaries do not report work or 

SSA does not take action on work reports in an appropriate or timely 

manner. When a DI work-related overpayment is identified, the 

beneficiary is notified of the overpayment and may request 

reconsideration or waiver of that overpayment. A beneficiary requests 

reconsideration when he or she disputes the occurrence of the 
Page 7 GAO-16-34 Disability Insurance 

overpayment itself.20 A beneficiary may also request a waiver of an 

overpayment that is not in dispute, and SSA may grant that waiver 

request if two conditions are met: (1) the agency finds the beneficiary was 

not at fault, and (2) recovery or adjustment would either defeat the 

purpose of the program or be against equity and good conscience, as 

determined by SSA.21

20See 20 C.F.R. § 404.907. 

2120 C.F.R. § 404.506. However, for overpayment amounts under $1,000, administrative 

waivers may be granted on the sole basis that the beneficiary was not at fault. 
Page 8 GAO-16-34 Disability Insurance 

Figure 2: Social Security Administration Procedures for Processing DI Beneficiary 

Waiver Requests 

aSSA can administratively waive overpayments under $1,000, without consideration of the second 

criterion, if there is no indication the beneficiary was at fault. 

bSSA stated that it cannot deny a waiver request until the beneficiary has the opportunity to have a 

personal conference by an impartial decision maker. If the beneficiary is offered but declines the 

personal conference or does not show up for his or her personal conference, the next level of appeal 

is a reconsideration. 
Page 9 GAO-16-34 Disability Insurance 

SSA’s DI cumulative overpayment debt has almost doubled over the last 

decade, from $3.2 billion at the end of fiscal year 2004 to $6.3 billion at 

the end of fiscal year 2014, according to SSA data.22, 23 Cumulative 

overpayment debt is comprised of existing debt carried forward from prior 

years, new debt, reestablished debts (such as debts reactivated for 

collection when former beneficiaries are entitled to receive benefits again) 

and adjustments, minus debts that are collected or written off by SSA.24

Cumulative DI overpayment debt has continued to grow because in 9 of 

the last 10 years the debt added has exceeded the total debt collected 

and written off. Specifically, over the 10 years reviewed, SSA added 

about $15.4 billion in debt,25 while collecting $7.8 billion and writing off 

$4.5 billion. 

22GAO previously found that cumulative DI overpayment debt is understated due to a 

limitation in SSA’s Recovery of Overpayments, Accounting and Reporting (ROAR) 

system. Used to track overpayments and collections, ROAR cannot capture and track 

debt scheduled to be collected beyond the year 2049. As a result, the amount scheduled 

to be collected after that year is not reflected in current totals even as it annually 

increases. GAO recommended that SSA correct the ROAR 2049 system limitation so that 

debt scheduled for collection after 2049 is included in the system and available for SSA 

management, analysis, and reporting. SSA agreed with this recommendation and has 

taken steps to request resources to correct the 2049 system limitation. For more 

information see GAO, Disability Insurance: SSA Can Improve Efforts to Detect, Prevent, 

and Recover Overpayments, GAO-11-724 (Washington, DC: July 27, 2011). 

23SSA provided summary data on DI beneficiary cumulative debt, new debt detected, 

adjustments, collections, and write-offs for each fiscal year for fiscal years 2005 through 

2014. SSA cites the source of these data as its fourth quarter report for the Treasury 

Report on Receivables (TROR) for each fiscal year. 

24Write-offs include waivers and terminated collections. Waivers represent money the 

agency will never recover because waived overpayments are permanently removed from 

SSA’s accounts receivable balance. Terminated collections conditionally remove debts 

from SSA’s accounts receivable balance, as the agency has ceased active internal 

collection efforts. Terminated debts are available for future collection if the debtor 

becomes re-entitled to benefits, in which case SSA will re-establish the debt and resume 

recovery through benefit withholding. SSA will also reestablish the debt if it receives a 

collection from one of its external collection methods such as tax refund offset. 

25New debt accounted for about $14 billion, or about 91 percent of the total added debt. 

Reestablished debts, which are debts reactivated for collection due to re-entitlement or 

other event, and adjustments accounted for about $686 million and $667 million of the 

total, respectively. 
Page 10 GAO-16-34 Disability Insurance 

Overpayment debt resulting from beneficiaries earning above program 

limits (referred to hereafter as “work-related” overpayments) represent 

more than half of all overpayment debt, and more than a quarter of all 

beneficiaries with overpayments. According to data provided by SSA, the 

agency overpaid DI beneficiaries a total of about $20 billion during fiscal 

years 2005 through 2014, and more than half of this total ($11.5 billion) 

was a result of beneficiaries’ earnings exceeding program limits.26 These 

data also showed that, on average, 28 percent of all overpaid 

beneficiaries received excess benefits because their work activity 

exceeded program limits.27 The average work-related overpayment per 

beneficiary was almost $12,000 during this period, compared to about 

$3,300 for non-work-related overpayments.28 For each year, total 

overpayments resulting from work activity were generally larger than nonwork-related overpayments—such as overpayments due to medical 

improvement (see fig. 3). 

26To determine the extent to which overpayments result from beneficiary work activity, we 

asked SSA to provide data on all DI overpayments that were work-related for each year in 

the 10-year period. In providing these data, SSA extracted information from its Recovery 

of Overpayments, Accounting and Reporting (ROAR) system, which reflects the current 

amount of beneficiary overpayments and the date established. However, when reporting 

overpayments in financial reports to Treasury or others, the agency must meet certain 

legal and financial accounting standards. SSA officials informed us that the Treasury 

Report on Receivables (TROR) report does not include what SSA characterizes as nonlegally defined overpayments, such as benefits issued for the month of death. For the 

same years, SSA’s fourth quarter report for the TROR included a total of about $14 billion 

in new legally defined overpayment debt to beneficiaries. 

27Tracking beneficiaries over a 10-year period, a recent SSA OIG study found that within a 

national sample of 985 DI beneficiaries it reviewed, 26 percent (259) of DI beneficiaries

were assessed overpayments and of these, about 12 percent (32) was due to work activity 

or changes in income. For this longitudinal study, see SSA OIG Overpayments in the 

Social Security Administration’s Disability Programs—A 10-Year Study (A-01-14-24114) 

June 4, 2015 at http://oig.ssa.gov/sites/default/files/audit/full/pdf/A-01-14-24114.pdf. 

28

‘Non-work-related’ overpayments refer to all overpayments established in a given year 

that were not due to beneficiary earnings exceeding program limits. 

Many DI 

Overpayments and 

Waivers Are Due to 

Beneficiary Earnings 

Exceeding Program 

Limits
Page 11 GAO-16-34 Disability Insurance 

Figure 3: Social Security Disability Insurance Overpayments: Total Dollar Amount 

and Percent Due to Earnings Exceeding Program Limits, Fiscal Years 2005 through 

2014

Note: Overpayment amounts are continuously updated in ROAR, which can lead to different amounts 

for the end of the fiscal year depending upon the date data are drawn from this system. For each 

year, these data differ from (were greater than) SSA’s financial reports to Treasury, which are 

adjusted to align with accounting standards and exclude overpayments that do not meet SSA’s

definition of a legal overpayment. 

a

In fiscal year 2014, work-related overpayments of about $992 million exceeded non-work-related 

overpayments of about $982 million. 

Similarly, the majority of all waived overpayment debt for fiscal years 

2005 through 2014 was for work-related overpayments. The total waived 

overpayment debt was about $2.4 billion during this period, and almost 60 

percent ($1.4 billion) of permanent losses for the DI Trust Fund was for 

work-related overpayments. The average number of waivers based on 

work activity annually was about 16,200, or 36 percent of the total. 

Moreover, a higher percentage of work-related overpayments was waived 

compared to the percentage of non-work-related overpayments (17 

percent versus 12 percent). The average annual work-related waiver 

amount was about $8,800 during the 10-year period compared to about 

$3,400 for non-work-related waivers. For each year, the dollar amount of 

waivers for work-related overpayments was larger than non-work-related 

waivers. In general, work-related overpayments were larger than nonwork-related overpayments (see fig. 4). 
Page 12 GAO-16-34 Disability Insurance 

Figure 4: Social Security Disability Insurance Waivers: Total Dollar Amount and 

Percent Due to Earnings Exceeding Program Limits, Fiscal Years 2005 through 

2014

Note: The waiver amount is continuously updated in ROAR, which can lead to different amounts for 

the end of the fiscal year depending upon the date data are drawn from this system. 

SSA regularly reviews the causes of improper overpayments—a subset of 

all improper payments29—but its methods have limitations that render 

some of its reported findings and projected estimates unreliable.30 SSA 

 

29An improper payment is defined as any payment that should not have been made or 

that was made in an incorrect amount (including overpayments and underpayments) 

under statutory, contractual, administrative, or other legally applicable requirements. It 

includes any payment to an ineligible recipient, any payment for an ineligible good or 

service, any duplicate payment, any payment for a good or service not received (except 

for such payments where authorized by law), and any payment that does not account for 

credit for applicable discounts. 

30For the most recent report, see SSA, Fiscal Year 2014 Title II Payment Accuracy 

Report, (Baltimore, MD: May 2015). 
Page 13 GAO-16-34 Disability Insurance 

annually reports to Congress, as required by law,31 the dollar amount 

associated with improper DI payments and other related information.32 In 

line with Office of Management and Budget guidance,33 SSA reviews a 

random statistical sample of DI benefit payments to provide the required 

estimates of improper payments for the DI program and for specific 

causes of the improper payments. While SSA’s sample is of sufficient 

size to estimate the DI program’s overall improper payments, including 

both overpayments and underpayments,34 our review found that the 

sample is not large enough to reliably attribute portions of the improper 

payment totals to categories of errors. Nevertheless, SSA reported that 

errors associated with beneficiaries having earnings above program limits 

were a major cause of improper overpayments, without disclosing that its 

findings and estimates were based on a handful of cases with small 

overpayment amounts.35 On the other hand, reviewing enough cases to 

achieve reliable projections based on the cause of improper payments 

would require a very large original sample from the universe of benefit 

payments, and therefore may not be cost effective. 

 

31The Improper Payments Information Act of 2002 (Pub. L. No. 107-300), as amended by 

the Improper Payments Elimination and Recovery Act of 2010 (Pub. L. No. 111-204) and 

the Improper Payments Elimination and Recovery Improvement Act of 2012 (Pub. L. No. 

112-248), as well as OMB guidance, require executive agencies to report annually on 

whether they are in compliance with various criteria, including publishing estimates of 

improper payments for all programs and activities identified under the agency’s risk 

assessment. 

32SSA makes information on improper payments publicly available on its website. 

33Office of Management and Budget guidance also instructs agencies to report as 

improper payments any payments for which insufficient or no documentation was found. 

See OMB Circular A-123, Appendix C for guidance on implementing the requirements 

related to improper payments. 

34For its recent report, SSA reviewed 1,768 cases, of which 552 cases were DI “nonmedical,” which, based on information provided by SSA, is sufficient to produce 

statistically reliable data on overall payment accuracy of DI payments issued during the 

fiscal year. 

35Given the small number of cases in its sample associated with improper payments, SSA 

used a 5-year rolling average of sample results—15 cases involving a total of $18,500 in 

overpayments—to project $3.7 billion in potential overpayments resulting from errors 

associated with beneficiaries’ earnings exceeding program limits. SSA refers to such 

potential overpayments as “deficiency dollars” because cases with more than one error 

would result in double counting related overpayments. 
Page 14 GAO-16-34 Disability Insurance 

SSA also conducts an internal quality review of work continuing disability 

reviews (CDRs) to identify the causes of payment errors, but this review 

also has limitations related to small sample sizes. SSA’s most recent 

report reviewed a random sample of work CDR decisions made in fiscal 

year 2013.36 It identified a variety of errors by staff that caused 

overpayment deficiencies, such as errors related to determining 

beneficiary earnings and resolving earning discrepancies. The report 

provides projected amounts of overpayments beyond the sample for each 

of these types of deficiencies for fiscal year 2013. SSA officials told us 

that its sample sizes for each error type were too small to report 

meaningful confidence intervals related to the types of deficiencies; 

however, this limitation is not disclosed in the report. More importantly, 

SSA lacks reliable information on the causes of overpayments to help 

focus or prioritize management attention. According to federal internal 

control standards, agencies must have relevant, reliable information to 

allow for effective monitoring and to help identify specific actions that 

need to be taken.37 Without reliable information, Congress and SSA may 

not effectively address the root causes of overpayments. 

In our reviews at several locations, we identified situations where SSA 

staff may not always record beneficiaries’ work information, which is 

inconsistent with SSA procedures as well as federal internal control 

standards.38 According to federal internal control standards, agencies 

should ensure that all transactions are recorded promptly and accurately 

to help management ensure efficient operations and make decisions. 

According to SSA procedures, staff must manually enter beneficiaries’

 

36SSA, Fiscal Year 2013 Title II Work Continuing Disability Review: Quality Review 

Findings (Baltimore, MD: August 2014). 

37GAO/AIMD-00-21.3.1. 

38GAO/AIMD-00-21.3.1. 

SSA’s Processes and 

Complex Program 

Rules May Contribute 

to Overpayments

Process Weaknesses and 

Limited Oversight for 

Handling Work Reports 

May Lead to 

Overpayments
Page 15 GAO-16-34 Disability Insurance 

work information into the eWork39 system, which generates a receipt and 

initiates tracking of that information. Under certain limited conditions, SSA 

policy allows staff to use an alternate approach instead of eWork to send 

work reports to the field office for manual entry and processing.40

Nevertheless, at one of six locations where we interviewed staff handling 

800 number teleservice calls,41 we learned that a teleservice center 

manager, responding to a notification from another office, found that staff 

were routinely using this alternate approach instead of directly entering 

the information into the eWork system, which tracks pending work reports 

to help ensure completion within 30 days. Work reports handled this way 

lack the controls present in eWork; for example, they are not 

automatically tracked against this 30-day goal, and thus, they can be 

more easily missed or overlooked. Further, work reports handled this way 

are at risk of being deleted or marked as completed without action being 

taken. According to SSA officials, tracking helps to ensure that SSA 

promptly processes the work report and takes the actions needed to 

adjust a beneficiary’s benefits and minimize the chance of overpayments. 

In addition, some beneficiaries may not receive a receipt for work 

information they report, as required by law and regulation. Some SSA 

claims representatives we interviewed told us that they may bypass 

entering beneficiaries’ work report information into eWork and instead 

initiate a continuing disability review (CDR) because it is more efficient; 

however this means that the beneficiary does not receive a receipt, as 

with a work report. SSA’s policy for conducting CDRs is not clear that a 

 

39In 2004, SSA implemented the eWork system, which is the primary system for 

processing work CDR cases in headquarters and field locations. 

40Rather than eWork, teleservice staff may use Modernized Development Worksheets 

(MDW) to transmit beneficiary work information to a field office. MDWs are a type of interoffice message used to request assistance from another SSA office. SSA policy allows 

teleservice staff to use MDWs to send DI work reports to the field office only if the work 

information is not being reported by a first party (i.e., the beneficiary, the representative 

payee, or someone who is acting at the request of the beneficiary), or when the staff 

person cannot acceptably establish the identity of the person making the report. 

41SSA staff answer 800-number teleservice line calls in 29 teleservice centers (TSC) 

nationwide, as well as two locations in the Office of Central Operations (OCO) in 

Baltimore, MD and Wilkes Barre, PA; and in the six program service centers (PSC) 

located across the country. The staff who answer calls include teleservice representatives 

in the TSCs, Customer Service Representatives in OCO and Technical Service 

Technicians and Benefit Authorizers who answer calls in the PSC locations. 
Page 16 GAO-16-34 Disability Insurance 

work report is required before initiating a CDR.42 In addition, due to 

competing workloads, staff told us that there may be delays in inputting 

work reports, and thus, delays in issuing receipts within the required 5 

business days when beneficiaries mail, fax, or phone in work reports or 

deliver them to the office but do not wait for the receipt. Further, several 

SSA staff told us that although SSA’s policy requires that beneficiaries 

receive a receipt for reporting work, there is no mechanism to help ensure 

that all beneficiaries who report ultimately receive a receipt. 

Representatives of advocacy organizations we interviewed said that 

beneficiaries they work with do not always receive receipts, especially 

when reporting work by calling the 800 teleservice line. Issuing a receipt 

is required by law and is valuable to the beneficiary for two reasons: (1) 

the beneficiary can review the receipt to ensure that SSA correctly 

recorded their information; and (2) a beneficiary who later receives an 

overpayment can produce work report receipts to help prove that he/she 

properly reported work activity. Without evidence showing that the 

beneficiary properly reported work, beneficiaries may be found at fault for 

a future overpayment and required to repay it.43

We also found deficiencies in controls regarding how work information is 

shared between the DI and SSI programs for beneficiaries who receive 

 

42Specifically, SSA’s policy covering work CDRs states that a work CDR should be 

initiated when a report of work is received from a beneficiary, but does not state that the 

work report must be documented in eWork before initiating the work CDR. 

43According to SSA, the receipt is one factor SSA considers when determining if a 

beneficiary is at fault in causing the overpayment. SSA policy states that any individual 

who demonstrates either a lack of good faith or failure to exercise a high degree of care in 

reporting circumstances which may affect entitlement to or the amount of benefits will be 

found at fault for the overpayment. The policy provides that lack of good faith in preventing 

an overpayment is evident when the facts show the overpayment resulted from: an 

incorrect statement by the person which he/she knew or should have known was false; the 

person's failure to furnish information which he/she knew or should have known was 

material; and the person's acceptance of any payment that he/she knew or should have 

known was incorrect. As such, presenting a work receipt with a waiver request does not 

automatically mean the beneficiary was without fault in causing the overpayment. The 

policy further provides that the degree of care expected varies with the complexity of the 

circumstances giving rise to the overpayment and the capacity of the individual to realize 

that he/she is overpaid. If the evidence clearly shows that the individual did not 

understand and comply with reporting responsibilities, that individual can usually be found 

without fault. See POMS GN 02250.005. 
Page 17 GAO-16-34 Disability Insurance 

both benefits,44 which can lead to overpayments. SSA has a mechanism 

for sharing DI and SSI program work information that is only partially 

automated. Specifically, a DI or SSI program alert is generated when 

earnings for a given period have been entered for one program, but not 

the other. When staff receive these alerts, the missing wage information 

must be manually entered, and in some cases, staff may need to 

calculate the correct wage amounts.45 However, SSA policies do not 

specifically require field office managers to monitor these alerts that 

would help ensure work information for concurrent beneficiaries is being 

entered into the databases for both programs. According to SSA, 

handling these alerts is left to the discretion of field office managers. In 

our case file review, we identified a recipient who had reported work by 

submitting over 40 pay stubs to the SSI program, but this information was 

not entered into the DI eWork system. Consequently, the individual was 

assessed an overpayment of more than $24,000 in the DI program, and a 

requested waiver was denied for “failure to report.”

Despite these vulnerabilities in the work reporting process, SSA lacks 

data to determine the extent to which staff are following established 

procedures. For example, although SSA’s eWork system captures some 

information that would help the agency determine how many reports are 

filed by fax, mail, phone, or in person, it lacks information in order to 

determine the extent to which receipts are provided within 5 days. In 

addition, SSA’s system has the capacity to capture the dates on which 

work reports were made and work CDRs were conducted, but the agency 

has not determined how often staff begin a CDR without first creating a 

work report and issuing a receipt, per SSA policy. Agency officials stated 

that this type of analysis would be a significant undertaking, and would 

include instances where a work report may not be required before 

beginning a work CDR.46 Similarly, officials said that in order to determine 

the extent to which 800 teleservice staff might be using alternative 

 

44Beneficiaries can also receive DI benefits concurrently with SSI, which provides monthly 

benefits to eligible applicants with limited income and resources who are disabled, blind, 

or 65 or older. In June 2015, about 1.6 million people with disabilities who were under age 

65 received both DI and SSI benefits. 

45SSI income is counted when it is paid, whereas DI income is counted when it is earned. 

Staff may need to review pay documents to determine the correct month in which to 

record the earnings on the individual’s DI record. 

46According to SSA policy, work CDRs resulting from an enforcement alert would not 

require a work report. 
Page 18 GAO-16-34 Disability Insurance 

approaches for sending work reports to field offices, the agency would 

have to match data between two systems, which it has not done to date. 

Officials stated they had no indication that offices were using an alternate 

approach and not following the established procedures for inputting work 

reports into eWork. 

Although the agency monitors the timeliness of staff action on work 

reports, SSA does not monitor whether these actions are appropriate, or 

provide guidance or feedback to staff. SSA has set a 30-day time frame 

for staff to screen pending work reports, and decide whether further 

action is required in light of the information in the work report, or whether 

the work report can be closed without conducting a work CDR. Field 

office managers who oversee field office workloads have access to 

management information showing the number and age of pending work 

reports, and those we interviewed indicated that they follow up on those 

approaching the 30-day time frame to ensure timely processing. Although 

SSA believes that it has provided guidance to staff on how to screen work 

reports to determine further action, we found that SSA’s policy lacks 

clarity in detailing the steps staff must take in screening these reports, 

and that offices had varied screening practices. Several field office staff 

we interviewed said that determining whether further action is needed is 

at the discretion of the staff person reviewing the work report, while staff 

in another field office said that they conduct a work CDR on every work 

report received. Federal internal control standards state that agencies’

policies and procedures should be clearly documented in administrative 

policies or operating manuals.47 Without explicit policies or procedures on 

how to screen a work report—that is, how to evaluate whether it should 

be closed or referred to a work CDR to determine whether the 

beneficiary’s benefits should be adjusted—there is an increased risk that 

a report could be improperly closed, and eventually result in a beneficiary 

being overpaid. 

SSA also lacks guidance and processes for ensuring appropriate work 

report screening and decisions through oversight and feedback to staff. In 

our work at several field locations, we did not identify any processes to 

review work reports that are closed without a CDR, or provide feedback to 

staff on their handling of such reports. Some managers we interviewed 

told us they did not feel work reports were sufficiently complex to warrant 

47GAO/AIMD-00-21.3.1. 
Page 19 GAO-16-34 Disability Insurance 

such reviews. SSA officials noted that if there were indications of 

problems, they could include reviews of work reports as part of existing 

review processes. In accordance with federal internal control standards, 

agencies should assure that ongoing monitoring occurs in the course of 

normal operations, and assess the quality of performance over time.48

The absence of oversight and feedback increases the risk that the agency 

may not identify errors with work report decisions in a timely manner. In 

discussing this issue with SSA, officials noted that the agency will take 

steps to update relevant policy to clarify instructions for screening reports; 

however, they did not indicate whether these updated policies will 

establish oversight and feedback procedures. 

SSA also does not offer automated reporting options for DI beneficiaries 

similar to those currently used in SSA’s Supplemental Security Income 

(SSI) program. Such options could help minimize the potential effect of 

vulnerabilities we identified. According to SSA officials, SSA first piloted a 

telephone wage reporting system for SSI recipients in 2003, and has 

used it nationally since 2008. In 2013, the agency also rolled out a mobile 

smartphone application for reporting work activity for SSI. Unlike the DI 

program’s manual process, both of these SSI reporting options assist with 

agency tracking and issue receipts to the individual without staff 

intervention. SSA has also noted that these automated tools make 

reporting easier and more convenient for recipients, and reduce field 

office workloads. SSA reported that it processed over 35,000 SSI 

telephone wage reports in July 2015. In the same month, the agency also 

received nearly 45,000 wage reports through its smartphone application. 

SSA continues to promote these methods for SSI recipients and expects 

that expanded use of automated reporting will help reduce improper 

payments in the SSI program. 

Despite potential benefits to the DI program, SSA officials told us the 

agency is not pursuing SSI reporting systems for DI beneficiaries. In 

October 2010, SSA created a work group to begin exploring the 

development of a telephone reporting system for the DI program, but 

according to SSA officials, the project was discontinued in February 

2011—after developing cost estimates for one year of development—due 

to lack of resources. They also told us these efforts were not resumed 

because automated reporting in the DI program would not have the same 

48GAO/AIMD-00-21.3.1. 
Page 20 GAO-16-34 Disability Insurance 

return on investment as in the SSI program, due to the complexity of DI 

program rules. Specifically, while the SSI reporting system automatically 

calculates the effect of the work report on an individual’s benefits, officials 

said that factoring DI work incentives into the equation—determinations 

that are currently a part of the work CDR process, not the DI work 

reporting process—cannot be easily automated. Rather than pursue 

options that allow beneficiaries to report by phone or smartphone 

application without automating the CDR process, SSA officials stated they 

currently favor using the “my Social Security” portal for providing 

automated reporting options to DI beneficiaries. SSA officials said for 

fiscal year 2016, the agency approved development of a work report 

portal using the my Social Security website that would create an avenue 

for DI beneficiaries to report work electronically, but stops short of 

automating the work CDR process. However, the agency could not 

provide us with specific details on how they planned to accomplish this or 

when they would implement such an approach. In the meantime, the 

current manual DI work reporting process is vulnerable to error and 

ultimately, overpayments. 

Due in part to SSA’s unclear work reporting requirements and differing 

interpretations by staff of complex DI program rules, beneficiaries may 

receive inadequate and inconsistent guidance on when to report their 

work, which may result in overpayments. SSA’s regulations49 and its 

policy manual both state that DI beneficiaries should “promptly” report 

changes in work activity, but SSA has not defined this term, thus leaving it 

open to interpretation by both beneficiaries and SSA staff. Similarly, in its 

pamphlet “Working While Disabled,” beneficiaries are instructed to report 

changes in their work “right away.” However, it does not prescribe a time 

period or frequency of reporting. During our interviews with field staff, we 

found variation in how staff instructed beneficiaries to report. For 

example, some staff said they instruct working beneficiaries to report 

monthly, regardless of whether there are changes in their work, which is 

similar to the SSI program’s wage-reporting requirements. Other staff told 

us they tell beneficiaries to report 10 days after any change, which is also 

similar to another SSI reporting requirement.50 One staff person indicated 

that beneficiaries need not report earnings under $15,780 per year, even 

 

4920 C.F.R. § 404.1588(a). 

50SSI recipients must report certain changes such as changes of address or changes in 

income within 10 calendar days after the month in which the change occurred. 

Beneficiaries May Receive 

Inadequate Information on 

Complex Program Rules
Page 21 GAO-16-34 Disability Insurance 

though this earnings limit applies to those receiving Social Security 

retirement benefits, not DI. Thus, a DI beneficiary who relied on such 

information could incur an overpayment. According to federal internal 

control standards, federal agencies should ensure that pertinent 

information is distributed to the right people in sufficient detail and at the 

appropriate time to enable them to carry out their duties and 

responsibilities efficiently and effectively.51

SSA provides some additional written materials to beneficiaries to inform 

them about their benefits and use of work incentives, but this information 

is only distributed upon request and does not clarify requirements for 

reporting work.52 Specifically, SSA prepares a statement of the 

beneficiary’s benefits and work history as stored in SSA’s electronic 

records, called the Benefits Planning Query.53 It provides customized 

information to beneficiaries, including a summary of their DI and SSI work 

and earnings history, as well as disability cash benefits paid. This 

information could help make beneficiaries aware of how SSA is tracking 

their work activity and whether their work information and earnings are 

recorded accurately, which could help avoid overpayments. According to 

SSA, the agency only prepares this statement upon request from 

beneficiaries or their representatives, and includes this information in 

notices sent to beneficiaries when the agency has already made a CDR 

determination.54 Although one publication for DI beneficiaries, the SSA 

Red Book55 describes the Benefits Planning Query and how to request 

51GAO/AIMD-00-21.3.1. 

52In commenting on our report, SSA identified grant and other programs designed to 

support DI beneficiaries who are trying to work (see app. I). SSA-funded programs that 

provide return-to-work supports through contractors or other outside organizations were 

outside the scope of our review. 

53According to SSA, the Benefits Planning Query was originally developed for the Ticket 

to Work Program, which helped eligible DI and SSI beneficiaries obtain and retain 

employment and reduce dependence on SSA benefits. Service providers, called 

employment networks, used the Benefits Planning Query to advise beneficiaries about 

available work incentives. 

54In commenting on our report, SSA noted that information in the Benefits Planning Query 

is presented in a format suited for those trained in work incentive policies. 

55The Red Book is a general reference guide to SSA’s work incentives for disabled 

beneficiaries, including DI beneficiaries. See Social Security Administration, The Red 

Book: A Summary Guide to Employment Supports for Persons with Disabilities Under the 

Social Security Disability Insurance and Supplemental Security Income Programs. SSA 

Publication 64-030. (Baltimore, MD: 2015) 
Page 22 GAO-16-34 Disability Insurance 

one, other SSA publications for DI beneficiaries, such as the “Working 

While Disabled” pamphlet, do not. 

Further, in our reviews at several locations, we found that some SSA staff 

may not fully understand DI’s complex work incentive rules. For example, 

several staff we spoke with confused the trial work period earnings 

threshold with substantial gainful activity limits. While we did not observe 

instances of SSA staff providing incorrect information to beneficiaries, 

such a mistake, if shared with beneficiaries, could result in incorrect 

reporting. Stakeholder groups we spoke with cited similar examples of 

SSA staff providing beneficiaries with incorrect information on work 

incentives. SSA officials told us that in fiscal year 2013, the agency 

sampled calls received on its 800 teleservice line for quality review 

purposes, and found that calls regarding disabled work activity 

represented only 1.4 percent of the total call workload, but 2.3 percent of 

all errors identified. Several SSA managers we spoke with said that 

training could be enhanced for those staff answering calls on SSA’s 800 

teleservice line. In particular, they noted that staff members who answer 

calls only during months with high call volume (referred to as “spikes”) 

could especially benefit from refresher training on DI program rules, since 

they only answer calls for several months each year. In discussing this 

finding, SSA officials said they plan to review the specific errors 

mentioned in the 800 teleservice call quality review reports, and where 

appropriate, evaluate the need to provide refresher training to staff. 

Despite the importance and challenges associated with work reporting, 

SSA provides beneficiaries with infrequent reminders, and those 

reminders contain limited information about potential liability for 

overpayments. Federal internal control standards state that management 

should ensure there are adequate means of communicating with, and 

obtaining information from, external stakeholders that may have a 

significant impact on the agency achieving its goals.56 SSA currently 

informs beneficiaries of reporting requirements when their benefit 

 

56GAO/AIMD-00-21.3.1
Page 23 GAO-16-34 Disability Insurance 

application is initially approved although it could be many years before a 

beneficiary returns to work.57

SSA also sends an annual letter to beneficiaries regarding cost-of-living 

adjustments to their benefits that includes a reminder of their reporting 

responsibilities; however, several staff indicated that additional reminders 

would prompt more beneficiaries to report work. In contrast, in fiscal year 

2014, SSA began providing a web-based service designed to prompt SSI 

recipients to report wages, using e-mails and text message reminders. 

SSA officials told us that DI beneficiaries are not prevented from using 

this service, but unlike SSI recipients, DI beneficiaries are not 

systematically informed of this service. They also stated that the agency 

does not have specific plans to provide additional notices to DI 

beneficiaries to encourage work reporting. Lastly, although the initial 

application and annual letter mention potential liability for overpayments 

for beneficiaries who do not report work, SSA’s “Working While Disabled”

pamphlet—which contains details about work incentives and is provided 

to beneficiaries who contact SSA about work—does not explain 

circumstances under which a beneficiary could be found liable for an 

overpayment. For example, a beneficiary can be found liable for an 

overpayment even if he or she is not at fault, if the beneficiary has the 

financial means to repay the overpayment, and recovery of an 

overpayment would not be against equity and good conscience.58 Some 

SSA staff we spoke with said they tell beneficiaries not to spend benefit 

checks or deposits that they believe were sent in error.59 However, 

representatives of one stakeholder group we spoke with said that many 

beneficiaries mistakenly believe that if they diligently report work and still 

receive benefits, they must be entitled to them. Without a careful 

exploration of options for ensuring sufficient and timely reporting 

reminders to DI beneficiaries—and appropriate follow through with 

 

57One SSA staff member suggested a way to make it more difficult for beneficiaries who 

incur an overpayment to claim they were unaware of their reporting responsibilities. 

Specifically, this staff member indicated that the signature page of the application for new 

beneficiaries could include information about work reporting requirements. This 

information is currently included in the application form but not on the signature page. 

58Beneficiaries may also be responsible for repaying benefits they continue to receive 

while appealing an initial decision, when the final decision is not in their favor. 20 C.F.R. § 

404.1597(j). 

59According to SSA policy, beneficiaries may request a voluntary suspension of benefits to 

avoid or reduce a possible overpayment. See POMS DI 13010.160C. 
Page 24 GAO-16-34 Disability Insurance 

implementing the best option—SSA may forego opportunities for 

enhancing the beneficiaries’ understanding of work reporting 

requirements, and preventing future overpayments caused by lack of 

beneficiary reporting. 

Our work and reviews by others found weaknesses in SSA’s process for 

waiving overpayments that increase the risk of error, including: 

 limited controls over waivers involving low-dollar overpayments, 

 high error rates in waiver documentation and minimal documentation 

requirements for certain waivers, 

 lack of tools to verify self-reported information on beneficiaries’

income and assets, and 

 limited oversight, especially for waivers involving low dollar amounts. 

Currently, SSA policy allows certain overpayments to be waived without 

any review, increasing the risk of error or fraud. As shown in Table 1, 

service and teleservice representatives, as well as claims 

representatives—SSA’s front line staff—can “administratively” waive 

overpayments up to $1,000—that is, without additional review of their 

decision and without consideration of a beneficiary’s ability to repay, as 

long as the beneficiary is not at fault for the overpayment. In addition, 

according to SSA’s policy manual, claims representatives can waive 

overpayments of up to $2,000 without additional review of their decision, 

although all waiver criteria must be considered, including the ability of the 

beneficiary to repay the debt. 

Table 1: Social Security Administration Procedures for Title IIa Waiver Approval by 

Waiver Amount 

Overpayment Amount Review Procedures

$1,000 or less (administrative 

waiver)

Service Representative/Teleservice Representative or 

higher may approve—additional review not required and 

no consideration and documentation of beneficiary’s 

ability to pay requiredb

$1,000.01 or more but less 

than $2,000

Claims representative (CR) or higher may approve—

additional review not required

$2,000 or more but less than 

$20,000

CR or higher makes initial decision; review by second 

CR or higher required

$20,000 or more but less than 

$75,000

CR or higher makes initial decision; review by 

Management Support Specialist or higher required

$75,000 or more CR or higher makes initial decision; review by 

management official and regional management required

Weaknesses 

Undermine SSA’s 

Handling of 

Overpayment 

Waivers
Page 25 GAO-16-34 Disability Insurance 

Source: GAO review of SSA POMS policy manual | GAO-16-34

a

Title II waivers include waivers of overpayments to those receiving old-age, survivor and dependent 

benefits, as well as those receiving DI benefits 

bStaff in SSA’s program service centers are also authorized to administratively waive overpayments 

of $1,000 or less. 

SSA’s risk-based approach of not requiring additional reviews for lowdollar waivers is consistent with internal control guidelines, but a systems 

limitation could allow staff to incorrectly waive overpayments or prevent 

managers from detecting incorrect waivers that represent a large portion 

of the total number of waived overpayments.60 For example, although 

SSA’s Debt Management System (DMS)61 is supposed to prevent staff 

from administratively waiving overpayments over $1,000, a 2015 SSA 

quality review report noted that DMS inappropriately allows SSA staff to 

do so. Moreover, 12 of the 54 staff and managers we interviewed who 

were responsible for handling waivers, including 5 technical experts who 

advise staff handling waivers, were unclear or provided incorrect 

information about amounts that could be waived without review. 

Moreover, six of the staff and managers incorrectly believed that DMS 

automatically prevents staff from approving a waiver above their 

authorized limit. Federal internal control standards state that agencies 

should have controls in place to ensure the completeness, accuracy, 

authorization, and validity of all transactions during data processing.62

Without these controls, SSA lacks reasonable assurance that waivers are 

being appropriately granted. In our limited review of 10 cases involving 

waived overpayments, we found 1 overpayment exceeding $1,000 that 

was administratively waived, which is contrary to SSA’s policy that allows 

administrative waivers only for overpayments under $1,000. As of 

September 2015, SSA did not yet have specific plans for making the 

necessary changes to the DMS system. 

60In fiscal year 2014, staff approved 10,282 waiver requests for overpayments under 

$2,000 (with a total waiver value of $8 million)—which represents almost one third of all 

approved waivers (34,756), albeit only 4 percent of the total amount approved for that 

year. Of these, 6,857 were $1,000 or less. 

61DMS is SSA’s financial management system. DMS consolidates the agency’s program 

debt activities, including overpayments and actions against the debts, amounts collected 

and written off (e.g., waivers), and methods of collection and debtor requests for due 

process. 

62GAO/AIMD-00-21.3.1
Page 26 GAO-16-34 Disability Insurance 

Further, SSA’s minimal documentation requirements for waivers under 

$1,000 when the beneficiary is not at fault limit the agency’s ability to 

conduct effective oversight. For these waivers, staff are instructed to 

document the decision as a remark in the beneficiary’s DMS record. 

SSA’s practice is to delete such remarks from the record 6 months after 

the overpayment event, making it difficult for SSA to review the decisions 

at a later date. In our review of 10 DI case files, including 2 involving 

overpayments under $1,000, we found one case where an overpayment 

had been administratively waived in 2013, but the electronic file did not 

include or no longer included DMS remarks or other documentation 

explaining the reason for the waiver. Federal internal control standards 

state that transactions need to be clearly documented, and the 

documentation should be readily available for examination.63

Two recent reviews found that staff are waiving overpayments without 

sufficient documentation, and SSA is taking remedial steps in response to 

these findings; however, neither the reviews nor SSA’s planned actions 

explicitly target low-dollar overpayments and waivers. In 2015, SSA’s 

Continuous Quality (CQ) Area Director Reviews found documentation 

errors in 45 percent of the initial Title II waiver decisions that were 

reviewed, and in more than half of the waiver decisions resulting from 

personal conferences, which are the next step of the waiver process.64 In 

addition, a 2015 review by the SSA Office of the Inspector General 

(OIG)65 found that 63 percent of Title II waivers they reviewed did not 

have all of the required documentation to support the request for waiver 

and SSA’s decision. Both the OIG study and the SSA review made 

recommendations to address gaps in guidance and training on waiver 

processing. In response to the CQ report, an SSA work group 

recommended clarification of the agency’s policy for waiver processing as 

 

63GAO/AIMD-00-21.3.1

64Social Security Administration, Continuous Quality Area Director Review: Data Analysis 

Report Findings and Recommendations (Baltimore, MD: January 2015). In this report, 

2,849 Title II initial waiver decisions and 1,152 personal conference waiver decisions were 

reviewed. 

65SSA OIG limited its review to 833 field offices that processed at least 100 Title II or Title 

XVI (Supplemental Security Income for the aged, blind and disabled) overpayment waiver 

requests during fiscal years 2012 and 2013, and then selected offices where the waiver 

approval rates were outside the typical range. SSA Office of Inspector General, 

Overpayment Waiver Requests Processed by Field Offices in FY2012 and FY2013

(Baltimore, MD: July 30, 2015) 
Page 27 GAO-16-34 Disability Insurance 

well as systems enhancements. SSA indicated that it plans to roll out a 

decision tree tool nationally this year, and anticipates having a draft plan 

for addressing the report’s other recommendations in fall 2015. In 

response to the OIG’s recommendation, SSA announced on September 

2, 2015, the availability of additional tools for handling overpayments. In 

addition, SSA developed and released an 8-part training video on 

documenting waiver requests and decisions. 

In light of SSA’s limited controls over waivers involving low-dollar 

overpayments, and general weaknesses found in the waiver process, 

SSA’s oversight over DI waiver decisions is limited. Specifically, the 

agency does not conduct targeted reviews of DI waivers, including some 

low-dollar waivers, or regularly analyze waiver data for the purposes of 

monitoring or performance improvement. SSA officials told us they track 

the amount of overpayment debt that is waived, but do not systematically 

review the completeness of the documentation, or trends in waiver 

decisions. To help ensure quality of field office case handling, including 

waivers, SSA relies on CQ Reviews, which are conducted under the 

direction of the agency’s area offices. These reviews began in 2014 and 

have included a quality review of some Title II waiver decisions but did 

not target DI waiver decisions or DI waiver decisions under $2,000. SSA 

also reviewed a sizeable number of SSI waiver decisions (nearly 5,500) 

under $2,000 and found that 50 percent of those decisions needed 

corrective action.66 SSA did not conduct a comparable review of DI 

waivers, although SSA officials stated that it would be helpful to do so. At 

the same time, in July 2015, SSA’s OIG reported a wide range in the 

percentage of waivers approved by field office staff in fiscal years 2012 

and 2013; specifically, 60 field offices approved Title II waivers at a rate of 

91 percent or higher, including 14 offices that approved waivers at a rate 

of 96 percent or higher, while 30 field offices approved waivers at a rate 

of 40 percent or lower. The OIG noted that five of the field offices with 

Title II waiver approval rates between 96 and 100 percent also had 

approval rates above 50 percent for administrative waivers, which require 

less documentation and no supervisory review. The OIG report 

recommended that the agency regularly analyze data and review field 

offices with extremely high or low waiver approval rates to determine 

compliance with SSA’s waiver policies. SSA agreed with the OIG’s 

 

66Corrective actions represent a combination of decision and documentation errors. Not all 

corrective actions involve a payment error. 
Page 28 GAO-16-34 Disability Insurance 

recommendation and also agreed to explore the possibility of developing 

an automated program that would compile data on DI waivers and report 

that information by field office. However, OIG’s recommendations and 

SSA’s plans do not go as far as conducting regular reviews of DI waiver 

decisions, including those involving some overpayments under $2,000. 

Another weakness in the waiver process is the lack of tools to help verify 

beneficiaries’ self-reported income and assets, which increases the 

potential for making waiver decisions based on inaccurate information. 

SSA staff we interviewed noted challenges with collecting and assessing 

financial information from beneficiaries, which they need to determine 

beneficiaries’ financial situation and their ability to repay an overpayment. 

Agency officials told us that they are considering using SSI program 

processes, called Access to Financial Institutions, to verify financial 

information when DI beneficiaries request a waiver or a reduced monthly 

withholding of their DI benefits. However, these officials said that unlike 

its authority under the SSI program,67 federal law does not currently 

authorize SSA to obtain financial records of DI beneficiaries. Officials 

noted that they are pursuing this authority via a legislative proposal 

included in the President’s fiscal year 2016 budget proposal.68

Benefits paid to working individuals who have earnings above DI program 

limits represent an avoidable drain on the nation’s dwindling DI trust fund. 

Such overpayments may also place undue financial hardship on 

conscientious beneficiaries who reported work but nevertheless were 

overpaid and now have to repay this debt. In addition, the potential for 

such an overpayment may create a disincentive for beneficiaries to 

further pursue work. Although SSA reports information on the causes of 

DI overpayments, this information is unreliable and as such, is less 

helpful in identifying potential solutions. Despite the importance of 

avoiding overpayments, SSA’s multi-faceted processes for handling work 

reports contain internal control weaknesses and other vulnerabilities that 

may result in SSA not taking prompt action to adjust benefits and avoid 

overpayments. In addition, absent an oversight process that helps ensure 

proper screening of work reports, SSA may be missing additional 

opportunities to prevent overpayments. Nonetheless, SSA has done little 

 

67See 42 U.S.C. § 1383(e)(1)(B)(ii)(I). 

68Specifically, SSA has requested authority to verify financial information for DI and other 

beneficiaries seeking overpayment waivers. 

Conclusions
Page 29 GAO-16-34 Disability Insurance 

to automate DI work reporting options as it has for SSI recipients, which 

leaves the process more open to error. In addition, SSA has not provided 

a clear trail of evidence for those who diligently report work. 

Overpayments may also result from complex program rules, which 

confuse beneficiaries and SSA employees, yet SSA has not sought to 

clarify internal or external guidance, or employed technology to 

communicate more frequently with beneficiaries, as it has with the SSI 

program. Finally, by not fully leveraging ongoing initiatives to review DI 

waiver approvals, including low-dollar waivers—despite evidence 

indicating that waiver policies have been inconsistently applied—the 

agency is limited in its ability to pinpoint weaknesses in policies, 

procedures or practices, and ensure overpayments are not waived in 

error. 

To improve SSA’s handling of overpayments, work reports, and waivers, 

we are making the following seven recommendations to SSA’s 

Commissioner: 

1. To improve transparency in reporting processing errors, SSA should 

provide additional information on the margins of error or confidence 

intervals, and clearly identify any limitations in its findings on 

overpayment information provided to Congress and the public. 

2. To minimize the potential effect of vulnerabilities in the work reporting 

process, SSA should take steps to help ensure that work information 

is entered directly into eWork, the system of record for work 

information, and issue required receipts. Such steps could include: 

a) Improving and issuing guidance and training to field and 800-

number staff to help ensure they log information into eWork and 

issue required receipts. 

b) Establishing policies to monitor alerts to help ensure that work 

information for concurrent beneficiaries is reflected in SSI and DI 

systems, and take steps to monitor and make enhancements to 

systems or guidance, as needed. 

3. To further ensure the effective screening of work reports, SSA should 

monitor its process for handling work reports to determine whether 

staff are taking action on work reports in accordance with proper 

procedures, and provide feedback to staff as needed. 

4. To enhance the ease and integrity of the work reporting process, SSA 

should study the costs and benefits of automated reporting options, 

including options similar to those currently available for SSI recipients, 

Recommendations for 

Executive Action
Page 30 GAO-16-34 Disability Insurance 

but that do not go as far as automating the continuing disability review 

process. 

5. To enhance beneficiary understanding of work reporting 

requirements, SSA should: 

a) Clarify work reporting requirements provided to beneficiaries. 

b) Explore options for increasing the frequency of reporting 

reminders to DI beneficiaries, similar to those currently available 

to SSI recipients. 

6. To improve compliance with waiver policies, SSA should develop a 

timetable for implementing updates to its Debt Management System 

to: 

a) Align system controls with SSA policy, so that waivers over $1,000 

cannot be administratively waived. 

b) Ensure that evidence supporting waiver decisions is sufficiently 

maintained to allow for subsequent monitoring and oversight. 

7. To improve compliance with waiver policies, SSA should take steps to 

regularly assess the accuracy of DI waiver decisions, particularly for 

administrative waivers and for some waivers under $2,000. This could 

include periodically reviewing approved and denied DI waivers 

through its continuous quality initiative. 

We provided a draft of this report to the Social Security Administration 

(SSA) for comment. In its written comments, reproduced in appendix I, 

SSA agreed with all but one of our seven recommendations. SSA 

disagreed with our recommendation that it assess the quality and 

accuracy of work reports and provide feedback to staff as needed. In its 

response, SSA stated that work information provided by beneficiaries is 

not verified when provided in a work report, but instead during the 

process of conducting a work continuing disability review (CDR). In our 

report, we acknowledge the role of the work CDR process in verifying 

earnings and other information provided by the beneficiary, and ultimately 

determining the effect of work on benefit receipt. However, we also noted 

that if a work report were improperly closed when a work CDR should 

have been conducted, an overpayment could result; that SSA staff do not 

receive feedback on their handling of work reports; and SSA lacks 

procedures for reviewing work reports that are closed without a work 

CDR. We clarified our report and recommendation to reflect that oversight 

to determine whether staff are taking appropriate action on work reports, 

Agency Comments 

and Our Evaluation
Page 31 GAO-16-34 Disability Insurance 

and feedback to staff on their handling of these reports, are both lacking 

and needed to help SSA prevent unnecessary overpayments. 

SSA suggested that we reconsider including the statement that 

overpayments may have implications for the long-term solvency of the DI 

trust fund. SSA stated that DI overpayments constitute a very small 

percentage of total DI payments, and noted that the Social Security 

Trustees report does not identify overpayments as a factor in the longterm cost of the DI program. While we acknowledge that overpayments 

are a relatively small portion of DI payments overall, they constitute 

significant sums of taxpayer funds. Further, such improper payments, 

which are a government-wide issue, could potentially be reduced through 

further agency efforts, as discussed in our report. 

SSA also noted that our report did not acknowledge all that the agency 

does to inform beneficiaries about work incentives and to support 

individuals who want to return to work. SSA cited several such programs, 

including its Work Incentive Planning and Assistance grants to community 

organizations and the Ticket to Work program,69 which provide support to 

beneficiaries through contractors and the Department of Education’s 

Vocational Rehabilitation program. Our report focused on (1) the extent of 

DI overpayments and waivers, (2) how SSA’s handling of work activity 

reported by beneficiaries prevents overpayments, and (3) how SSA 

ensures appropriate decisions are made to waive overpayments. As 

such, we did not review whether or the extent to which these programs 

administered by outside parties provided correct or timely information on, 

or helped DI beneficiaries comply with work reporting requirements. SSA 

noted that going forward, it plans to encourage work and minimize 

overpayments through a variety of initiatives, including developing more 

efficient ways to provide beneficiaries and organizations serving them 

with a Benefits Planning Query and testing whether direct phone outreach 

would encourage SSI recipients to sign up for work reporting via phone 

and mobile applications. We are pleased that SSA is considering ways to 

improve outreach and facilitate reporting of work information—both of 

which could help minimize or prevent overpayments. 

 

69The Ticket to Work program provides funding for SSA disability beneficiaries to receive 

employment services, vocational rehabilitation services, or other services to help them 

obtain and retain employment and reduce their dependency on benefits or payments. 

Individuals may receive services from SSA-approved public or private providers, known as 

employment networks, or traditional state VR agencies. 
Page 32 GAO-16-34 Disability Insurance 

SSA agreed with the remainder of our recommendations and provided 

additional information about recent efforts to improve guidance on 

overpayment and waiver processing and steps the agency will take going 

forward. In agreeing with our recommendation that SSA study costs and 

benefits of automated reporting tools, SSA indicated it plans to explore a 

proposal to allow DI beneficiaries to report work activity on SSA’s my

Social Security website. We welcome SSA’s efforts to this end, but 

clarified in our recommendation that SSA should also study the costs and 

benefits of providing automated options currently available to SSI 

recipients—such as reporting work activity by phone—stopping short of 

automating the work CDR process. SSA also provided technical 

comments, which we incorporated as appropriate. 

We are sending copies of this report to the appropriate congressional 

committees and the Commissioner of the Social Security Administration. 

In addition, the report is available at no charge on GAO’s website at 

http://www.gao.gov. 

If you or your staffs have any questions about this report, please contact 

me at (202) 512-7215 or bertonid@gao.gov. Contact points for our 

Offices of Congressional Relations and Public Affairs may be found on 

the last page of this report. GAO staff who made major contributions to 

this report are listed in appendix II. 

Daniel Bertoni

Director, Education, Workforce and 

 Income Security 
Appendix I: Comments from the Social 

Security Administration 

Page 33 GAO-16-34 Disability Insurance 

Appendix I: Comments from the Social 

Security Administration
Appendix I: Comments from the Social 

Security Administration 

Page 34 GAO-16-34 Disability Insurance 
Appendix I: Comments from the Social 

Security Administration 

Page 35 GAO-16-34 Disability Insurance 
Appendix I: Comments from the Social 

Security Administration 

Page 36 GAO-16-34 Disability Insurance 
Appendix I: Comments from the Social 

Security Administration 

Page 37 GAO-16-34 Disability Insurance 
Appendix I: Comments from the Social 

Security Administration 

Page 38 GAO-16-34 Disability Insurance 
Appendix I: Comments from the Social 

Security Administration 

Page 39 GAO-16-34 Disability Insurance 
Appendix I: Comments from the Social 

Security Administration 

Page 40 GAO-16-34 Disability Insurance 
Appendix II: GAO Contacts and Staff 

Acknowledgments 

Page 41 GAO-16-34 Disability Insurance 

Daniel Bertoni, (202) 512-7215 or bertonid@gao.gov

In addition to the contact mentioned above, the following staff members 

made significant contributions to this report: Michele Grgich, Assistant 

Director; Dana Hopings and Art Merriam, Analysts-in-Charge; James 

Bennett, Julie DeVault, Leslie Gordon, Philip McIntyre, Jean McSween, 

Kevin Metcalfe, Ruben Montes de Oca, Jonathon Oldmixon, James 

Rebbe, Philip Reiff, Almeta Spencer, Charlie Willson, and Jill Yost. 

Appendix II: GAO Contacts and Staff 

Acknowledgments

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