INCOME SECURITY

Overlapping Disability 

and Unemployment 

Benefits Should be 

Evaluated for 

Potential Savings

Report to Congressional Requesters

July 2012

GAO-12-764

United States Government Accountability Office

GAO
United States Government Accountability Office

Highlights of GAO-12-764, a report to 

congressional requesters 

July 2012 

INCOME SECURITY 

Overlapping Disability and Unemployment Benefits 

Should be Evaluated for Potential Savings

Why GAO Did This Study

The DI and UI trust funds face serious 

fiscal sustainability challenges. In 

addition to other services, both 

programs provide cash benefits to their 

targeted populations to replace lost 

earnings. DI is available to workers 

who are unable to engage in SGA 

because of physical or mental 

impairments expected to last at least 

12 months or result in death. SGA is 

defined as work activity that involves 

significant physical or mental activities 

performed for pay or profit. UI provides 

temporary cash benefits to eligible 

workers who are able to work but 

remain involuntarily unemployed.

GAO was asked to determine the 

extent to which individuals received DI 

and UI benefits concurrently. To do so, 

GAO matched unemployment files with 

SSA disability files for fiscal year 2010. 

GAO also reviewed DI and UI case 

files for a nongeneralizable selection of 

8 individuals – 4 from the top 50 

recipients of concurrent DI and UI 

benefits in fiscal year 2010, and 4 who 

received UI benefits based on wages 

from multiple states. These examples 

cannot be generalized beyond those 

presented.

What GAO Recommends

DOL should work with SSA to (1) 

evaluate overlapping DI and UI cash 

benefit payments, taking appropriate 

action for any improper payments, and 

(2) assess whether cost savings or 

other benefits might be achieved by 

reducing or eliminating overlapping DI 

and UI cash benefit payments being 

made within the existing laws and 

regulations, seeking congressional 

authority to do so as appropriate. DOL 

and SSA agreed with the 

recommendations.

What GAO Found

In fiscal year 2010, 117,000 individuals received concurrent cash benefit 

payments from the Disability Insurance (DI) and Unemployment Insurance (UI) 

programs of more than $850 million, which is allowable in certain circumstances 

under current program authority. While these individuals represented less than 1 

percent of the total beneficiaries of both programs, the cash benefits they 

received totaled over $281 million from DI and more than $575 million from UI. 

One individual GAO selected for further investigation received over $62,000 in 

overlapping benefits in a year. Based on GAO inquiries, state UI officials are 

reviewing the person’s UI eligibility because of earnings that may be related to 

work that makes the person ineligible for UI benefits. 

Beneficiaries Receiving Overlapping DI and UI Benefits in Fiscal Year 2010 

Under certain circumstances, individuals may be eligible for concurrent cash 

benefit payments due to differences in DI and UI eligibility requirements. 

Specifically, the Social Security Administration’s (SSA) definition of a disability 

involves work that does not rise to the level of substantial gainful activity (SGA). 

In 2010, a monthly income of $1,000 or more for a non-blind beneficiary 

generally demonstrated SGA. In contrast, the Department of Labor allows states’ 

determination of “able and available for work” eligibility criteria for UI benefits to 

include work that does not rise to the level of SGA. Therefore, some individuals 

may have a disability under federal law but still be eligible for UI under state law 

because they are able and available for work that does not rise to the level of 

SGA. Although DI and UI generally provide separate services to separate 

populations—and thus are not overlapping programs—the concurrent cash 

benefit payments for individuals eligible for both programs are an overlapping 

benefit when both replace lost earnings. While SSA must reduce DI benefits for 

individuals receiving certain other government disability benefits, such as 

worker’s compensation, no federal law authorizes an automatic reduction or 

elimination of overlapping DI and UI benefits. As a result, neither SSA nor DOL 

has any processes to identify these overlapping payments. Reducing or 

eliminating overlapping or improper payments could offer substantial savings, 

though actual savings are difficult to estimate because the potential costs of 

establishing mechanisms to do so are not readily available.

View GAO-12-764. For more information, 

contact Richard J. Hillman at (202) 512-6722 

or hillmanr@gao.gov. 
Page i GAO-12-764 Income Security 

Letter 1 

Background 4

Concurrent DI and UI Payments Resulted in Hundreds of Millions 

of Dollars in Overlapping Benefit Payments 8

Conclusions 12

Recommendations for Executive Action 13

Agency Comments and Our Evaluation 13

Appendix I Comments from Department of Labor 15

Appendix II Comments from the Social Security Administration 17

Figures

Figure 1: DI and UI Benefit Payments for Fiscal Years 2005 through 

2011 8

Figure 2: Beneficiaries Receiving Overlapping DI and UI Benefits in 

Fiscal Year 2010 9

Abbreviations 

CDR continuing disability review

DI Disability Insurance

DOL Department of Labor

NDNH National Directory of New Hires

SSA Social Security Administration

SGA substantial gainful activity

UI Unemployment Insurance

Contents

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Page 1 GAO-12-764 Income Security 

United States Government Accountability Office 

Washington, DC 20548

July 31, 2012

The Honorable Carl Levin

Chairman

The Honorable Tom Coburn

Ranking Member

Permanent Subcommittee on Investigations

Committee on Homeland Security and Governmental Affairs

United States Senate

The Honorable Thomas R. Carper

Chairman

The Honorable Scott P. Brown

Ranking Member

Subcommittee on Federal Financial Management, Government

 Information, Federal Services, and International Security

Committee on Homeland Security and Governmental Affairs

United States Senate

Both the Social Security Disability Insurance (DI) and Unemployment 

Insurance (UI) trust funds face serious fiscal-sustainability challenges. 

The Social Security Board of Trustees projects that the DI trust fund will 

be exhausted in 2016 and notes that changes designed to improve the 

financial status of the DI program are needed soon. In fiscal year 2010, 

more than 10 million beneficiaries received DI cash benefits.1 Total 

benefit payments for fiscal year 2010 were $121.6 billion, and the aging of 

the baby-boom generation is set to further strain the program. Similarly, 

we reported in April 2010 that state UI trust funds were at historically 

weak levels, with most requiring federal loans to pay benefits.2 In fiscal 

year 2010, 11.3 million beneficiaries received UI cash benefits totaling 

$156 billion, $93 billion of which was paid by the federal government.3

 

1 This 10 million beneficiaries figure includes about 0.2 million spouses and about 1.8 

million dependent children.

2 GAO, Unemployment Insurance Trust Funds: Long-standing State Financing Policies 

Have Increased Risk of Insolvency, GAO-10-440 (Washington, D.C.: Apr. 14, 2010).

3 The federal government also provided $5.5 billion to the states in fiscal year 2010 for 

administration of the UI program.

 
 

Page 2 GAO-12-764 Income Security 

In addition to other services, the DI and UI programs both provide cash 

benefits to their targeted populations to replace lost earnings. The DI 

program, which is administered by the Social Security Administration 

(SSA), provides cash benefits to replace earnings for workers who are 

unable to engage in substantial gainful activity (SGA) because of physical 

or mental impairments expected to last at least 12 months or expected to 

result in death.4 SGA is defined as work activity that involves significant 

physical or mental activities performed for pay or profit.5

In response to your request, we determined the extent to which 

individuals received DI and UI benefits concurrently by comparing 

disability benefit files to national records of work-related income and 

unemployment insurance. Under certain circumstances, individuals can 

legitimately receive DI and UI concurrently, but concurrent receipt could 

also be an indicator of improper payments. Although excluded from the 

scope of this report, we plan to conduct subsequent work to evaluate the 

internal controls of the DI program.

The federal-state 

UI program, which is federally administered by the Department of Labor 

(DOL), provides temporary cash benefits to eligible workers who are able 

to work but remain involuntarily unemployed. 

To determine the extent to which individuals received both DI and UI 

benefits in fiscal year 2010, we matched the National Directory of New 

Hires (NDNH) unemployment files with our extracts of SSA disability files 

of DI beneficiaries as of December 2010, the most current data at the 

time we began our work. To determine the subset of recipients who 

received DI and UI benefits at the same time during fiscal year 2010, we 

identified individuals who received DI benefits in all 3 months of the 

quarter for which they received UI benefits.6

 

4 42 U.S.C. § 423.

For example, to be 

considered in receipt of overlapping DI and UI benefits under our criteria, 

an individual must have records in SSA disability files indicating the 

monthly receipt of DI benefits in January, February, and March of 2010, 

and must also have records in the NDNH indicating the quarterly receipt 

of UI benefits in the corresponding quarter of fiscal year 2010, which is 

the second quarter of fiscal year 2010. Because our population of 

5 20 C.F.R. §§ 404.1510, 404.1572. 

6 UI benefit payments are represented as quarterly totals in the National Directory of New 

Hires.
 

Page 3 GAO-12-764 Income Security 

overlapping DI and UI beneficiaries includes only those individuals who 

received DI in all 3 months of the quarter for which the NDNH reports the 

receipt of UI, our analysis understates the population of individuals who 

received overlapping DI and UI benefits in fiscal year 2010. For example, 

individuals who received overlapping DI and UI payments in only 1 or only 

2 months of a quarter are not included in our population of individuals 

who received overlapping DI and UI benefits in fiscal year 2010. Because 

of differences in the timing of DI and UI payments, the amount of 

overlapping DI and UI payments for our population is estimated. For each 

instance of concurrent DI and UI benefits, we used the monthly DI benefit 

amounts in SSA’s disability files and the quarterly UI benefit amounts in 

the NDNH to estimate the total amount of overlapping DI and UI benefits 

in fiscal year 2010. Our estimate of overlapping DI benefits is understated 

because it includes DI benefits payable for only 1 of the 3 months in a 

quarter for which an individual also received UI benefits. Thus, 

overlapping DI benefits that were payable in more than 1 month of a 

quarter are not included in our estimate.

We also reviewed detailed DI and UI case files for a nongeneralizable 

selection of eight individuals who received concurrent DI and UI benefits 

to corroborate SSA DI data and UI data in the NDNH. To do this, we drew 

a stratified random, nongeneralizable sample of eight individuals from two 

different populations. The first four individuals we selected were from a 

population comprising the top 50 recipients of concurrent DI and UI 

benefits in fiscal year 2010. The second four individuals we selected were 

from a population comprising the individuals who appeared to receive 

concurrent DI and UI benefits, the latter from multiple states in fiscal year 

2010. Because we selected a small number of individuals for further 

investigation, the results cannot be projected to the population of 

individuals receiving concurrent DI and UI benefits. For these eight 

individuals, we obtained DI information from SSA and UI information from 

state UI offices to determine the total amount of DI and UI benefits 

received from 2008 to April 2012, the time frame for those benefits, and 

any applicable employment information that illustrate instances of 

individuals receiving concurrent DI and UI benefits. Although identifying 

improper payments was not the primary purpose of this audit, some 

individuals we selected for further review received improper DI or UI 

payments.

To determine the reliability of the SSA disability records and NDNH UI 

records, we reviewed documentation related to these databases and 

interviewed officials responsible for compiling and maintaining relevant DI 

and UI data. In addition, we performed electronic testing to determine the 
 

Page 4 GAO-12-764 Income Security 

validity of specific data elements in the databases that we used to 

perform our work. We also reviewed detailed DI and UI case files for the 

nongeneralizable selection of eight individuals selected as described 

above who received concurrent DI and UI benefits to corroborate SSA DI 

data and UI data in the NDNH. On the basis of our discussions with 

agency officials and our own testing, we concluded that the data elements 

used for this report were sufficiently reliable for our purposes.

We conducted this performance audit from December 2011 through July 

2012 in accordance with U.S. 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 objective.

As the nation’s largest cash-assistance program for workers with 

disabilities, DI provides benefits to eligible individuals under Title II of the 

Social Security Act. An individual is eligible to receive DI benefits if he or 

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

has lasted (or is expected to last) at least 1 year or is expected to result in 

death and (2) prevents the individual from engaging in SGA.7 SGA is 

defined as work activity that involves significant physical or mental 

activities performed for pay or profit.8 For individuals whose impairment is 

anything other than blindness, earnings averaging over $1,000 a month 

for calendar year 2010 generally demonstrate SGA. For blind individuals, 

earnings averaging over $1,640 a month for the year 2010 generally 

demonstrate SGA for DI.9

 

7 42 U.S.C. § 423. 

The amount of earnings that generally 

8 20 C.F.R. §§ 404.1510, 404.1572. 

9 74 Fed. Reg. 55614 (October 28, 2009). For calendar year 2012, earnings averaging 

over $1,010 a month generally demonstrate SGA for individuals whose impairment is 

anything other than blindness. For calendar year 2012, earnings averaging over $1,690 a 

month generally demonstrate SGA for individuals who are blind. 76 Fed. Reg. 66111 

(October 25, 2011).

Background

Disability Insurance
 

Page 5 GAO-12-764 Income Security 

demonstrates SGA can vary from year to year.10 For example, the SGA 

amount for individuals with disabilities, other than blindness, was $980 in 

2009.11 Individuals with disabilities must also have a specified number of 

recent work credits under the Social Security program at the onset of 

medical impairment.12

DI benefits are financed by payroll taxes paid into the Federal Disability 

Insurance Trust Fund by covered workers and their employers, on the 

basis of each worker’s earnings history. Cash benefits are payable 

monthly, as long as the worker remains eligible for benefits, until the 

worker reaches full retirement age or dies. In fiscal year 2010, more than 

10 million beneficiaries received DI benefits totaling $121.6 billion, and 

the program’s average monthly benefit was about $922. As directed by 

federal law, SSA must reduce DI benefits for individuals receiving certain 

other government disability benefits, such as worker’s compensation.

An individual may qualify on the basis of the work 

record of a deceased spouse or the work record of a parent who is 

deceased, retired, or considered eligible for disability benefits, meaning 

one disability beneficiary can generate multiple monthly disability 

payments.

13

However, SSA may not reduce DI benefits for individuals receiving UI or 

for individuals earning less than SGA. As mentioned, the Social Security 

Board of Trustees projects that the DI trust fund will be exhausted in 2016 

and noted that changes designed to improve the financial status of the DI 

program are needed soon.

Established by the Social Security Act of 1935, the federal-state UI 

program temporarily and partially replaces the lost earnings of those who 

become unemployed through no fault of their own. To be eligible for UI 

benefits, unemployed workers must meet eligibility requirements 

established by state laws that conform to federal law, including that they 

have worked recently, be involuntarily unemployed, and be able and 

 

10 DI benefits are based on the worker’s past average monthly earnings, indexed to reflect 

changes in national wage levels (up to 5 years of the worker’s low earnings are excluded).

11 73 Fed. Reg 64651 (October 30, 2008).

12 Specifically, eligible individuals must have worked 5 out of the last 10 years or 20 

quarters out of the last 40 quarters. 42 U.S.C. § 423(c)(1); 20 C.F.R. §§ 404.130, 404.132. 

13 42 U.S.C. § 424a. According to SSA, the intent of the offset provision is to ensure that 

the combined benefits from workers’ compensation and Social Security are not excessive.

Unemployment Insurance
 

Page 6 GAO-12-764 Income Security 

available for work. Whereas federal statutes and regulations provide 

broad guidelines on UI eligibility, the specifics of UI eligibility are 

determined by each state. According to DOL, all states require that a 

claimant must have earned a specified amount of wages, worked a 

certain number of weeks in covered employment, or must have met some 

combination of the wage and employment requirements within his/her 

base period.14 To be eligible for benefits, claimants must also be free from 

disqualification for acts such as voluntary leaving without good cause, 

discharge for misconduct connected with the work, and refusal of suitable 

work. In addition to these eligibility requirements, all states require that a 

claimant must be able and available for work. However, “able and 

available for work” requirements vary among the states, according to 

DOL. For example, a few states specify that a worker must be physically 

able, or mentally and physically able, to work. Likewise, while some 

states require that a worker must be available for work, other states 

require that a worker must be available for suitable work; still other states 

require that a worker be available for work in the worker’s usual 

occupation or for work in which the worker is reasonably fitted by training 

and experience. According to DOL, in addition to being able and available 

for work, all states require by law or by practice that a worker be actively 

seeking work or making a reasonable effort to obtain work.15 Finally, 

some state laws expressly prohibit denying UI eligibility on the basis of 

illness or disability under certain circumstances.16

UI benefits and administrative costs are financed primarily by taxes levied 

on employers.17

 

14 Under all state UI laws, a worker’s benefit rights depend on his/her experience in 

covered employment in a past period, called the base period. 

These taxes are deposited in the appropriate accounts 

within the Unemployment Trust Fund, which consists of 53 state accounts 

15 This requirement did not become effective in Pennsylvania until January 1, 2012. See 

2011 Pa. Laws 6, § 4.

16 Specifically, at least 10 states have laws indicating that no worker shall be considered 

ineligible due to illness or disability occurring after the worker has filed a UI claim and 

registered for work, as long as the worker does not refuse suitable work when offered. 

These states include: Alaska, Delaware, Hawaii, Idaho, Maryland, Massachusetts, 

Nevada, North Dakota, Tennessee, and Vermont. 

17The federal taxes on employers are under the authority of the Federal Unemployment 

Tax Act (FUTA), and the state taxes are under the authority given by each state’s relevant 

unemployment tax acts. At least three states, Alaska, New Jersey, and Pennsylvania also 

withhold UI taxes from employee wages. 
 

Page 7 GAO-12-764 Income Security 

and other federal accounts dedicated to special purposes. The severity 

and length of the recent recession, and the slow pace of recovery, have 

placed a heavy demand on state UI trust funds, resulting in very large 

numbers of workers receiving benefits for very long periods of time. Since 

mid-2008, Congress and the states have temporarily extended the period 

of time that displaced workers can receive UI benefits to up to 99 weeks, 

though the maximum number of weeks of available benefits varies among 

the states.18 In April 2010, GAO reported that state UI trust funds were at 

historically weak levels, with most requiring federal loans to pay 

benefits.19 During fiscal year 2010, state agencies paid 11.3 million 

beneficiaries $156.4 billion in federal and state unemployment benefits.20

 

18 As of January 8, 2012, eligible unemployed workers could potentially receive the 

maximum 99 weeks of benefits in 17 states, according to DOL’s data, though some 

individuals may be eligible for fewer weeks in these states. However, pursuant to the 

Unemployment Benefits Extension Act of 2012, part of the Middle Class Tax Relief and 

Job Creation Act of 2012, the number of total weeks a recipient may receive benefits will 

gradually decrease throughout 2012. See Pub. L. No. 112-96, §§ 2122 - 2123, 126 Stat. 

156, 163 - 167.

UI benefits vary substantially during a business cycle. As shown in figure 

1, UI benefits varied substantially from 2005 to 2011, while DI benefits 

steadily increased during those years.

19 GAO-10-440. 

20 During fiscal year 2011, state agencies paid 9.9 million beneficiaries $113.3 billion in 

federal and state unemployment benefits. 
 

Page 8 GAO-12-764 Income Security 

Figure 1: DI and UI Benefit Payments for Fiscal Years 2005 through 2011

Note: Dollar amounts in figure 1 are presented in actual dollars rather than real (inflation adjusted) 

dollars. 

In fiscal year 2010, 117,000 individuals received concurrent cash benefit 

payments of more than $850 million.21 As shown in figure 2, these 

individuals represented less than 1 percent of the total beneficiaries of 

both programs. However, estimated overlapping cash benefits paid to 

these individuals totaled over $281 million from the DI program and more 

than $575 million from the UI program.22

 

21 As previously mentioned, our analysis understates the population of individuals who 

received concurrent DI and UI benefits in fiscal year 2010 because it includes only those 

individuals who received DI in all 3 months of a quarter.

For individuals receiving 

22 UI benefits increased dramatically in 2009 through 2011 from prior levels. According to 

a 2010 announcement by the National Bureau of Economic Research (NBER), a trough in 

business activity occurred in the U.S. economy in June 2009. According to NBER, the 

trough marks the end of the declining phase and the start of the rising phase of the 

business cycle. Economic activity is typically below normal in the early stages of an 

expansion, and it sometimes remains so well into the expansion. 

Concurrent DI and UI 

Payments Resulted in 

Hundreds of Millions 

of Dollars in 

Overlapping Benefit 

Payments
 

Page 9 GAO-12-764 Income Security 

overlapping benefits in fiscal year 2010, we estimate the average 

quarterly amount of overlapping cash benefit payments to be $1,093 in DI 

and $2,231 in UI, for a quarterly average of $3,324 in overlapping 

benefits.

Figure 2: Beneficiaries Receiving Overlapping DI and UI Benefits in Fiscal Year 2010

Note: Our estimate of overlapping DI benefits is understated because it includes DI benefits payable 

for only 1 of the 3 months in a quarter for which an individual also received UI benefits. Thus, 

overlapping DI benefits that were payable in more than 1 month of a quarter are not included in our 

estimate. 

Differences in program rules and definitions allow individuals in certain 

circumstances to receive overlapping DI and UI benefits without violating 

eligibility requirements. As mentioned, SSA’s definition of a disability 

involves work that does not rise to the level of SGA. For 2010, a non-blind 

person who is earning more than a $1,000 a month is ordinarily 

considered to be engaging in SGA. In contrast, states’ determination of 

“able and available for work” criteria for UI benefits may include 

performing work that does not rise to the level of SGA. As a result, some 

individuals may have a disability under federal law but still be able and 

available for work under state law, thus eligible to receive DI and UI 
 

Page 10 GAO-12-764 Income Security 

concurrently.23 SSA officials stated that UI is considered unearned 

income and therefore does not affect DI benefits.24

While the DI and UI programs generally serve separate populations and 

provide separate services—thus not meeting our definition for overlapping 

programs—the concurrent cash benefit payments made to individuals 

eligible for both programs are an overlapping service for the replacement 

of their lost earnings. We define overlaps as programs that have similar 

goals, devise similar strategies and activities to achieve those goals, or 

target similar users.

DOL officials 

acknowledged that certain individuals may be eligible for both DI and UI, 

depending on the applicable state laws regarding UI eligibility. Because 

these overlapping payments may be allowed under both programs’ 

eligibility requirements, and no federal law authorizes an automatic 

reduction or elimination of benefits if a recipient receives both payments, 

neither SSA nor DOL have any processes to identify these overlapping 

payments. As such, the costs associated with establishing mechanisms to 

reduce or eliminate these overlapping payments are not readily available.

25

 

23 For example, in an unpublished decision from the United States Court of Appeals for 

the Ninth Circuit, the court said: “[W]e note that [the plaintiff’s] receipt of unemployment 

benefits does not by itself support a conclusion that she is not credible. Generally, in order 

to be eligible for disability benefits under the Social Security Act, the person must be 

unable to sustain full-time work – eight hours per day, five days per week. However, under 

Oregon law, a person is eligible for unemployment benefits if she is available for some 

work, including temporary or part time opportunities. Therefore, [the plaintiff’s] claim of 

unemployment in Oregon is not necessarily inconsistent with her claim of disability 

benefits under the Social Security Act.” Mulanax v. Comm’r of Soc. Sec., 293 Fed. Appx. 

522 (9th Cir. 2008) (citations omitted).

Our prior work on overlapping government 

programs has found that, in some instances, overlapping programs or 

activities have led to inefficiencies, and we have determined that greater 

efficiencies or effectiveness might be achievable. However, in other 

instances, it may be appropriate for multiple agencies or entities to be 

involved in the same programmatic or policy area due to the nature or 

magnitude of the federal effort.

24 DI benefits are only reduced in specified situations, such as receipt of worker’s 

compensation or certain other public disability benefits. 

25 GAO, 2012 Annual Report: Opportunities to Reduce Duplication, Overlap and 

Fragmentation, Achieve Savings, and Enhance Revenue, GAO-12-342SP (Washington, 

D.C.: Feb. 28, 2012).
 

Page 11 GAO-12-764 Income Security 

Although current program rules allow overlapping benefits under certain 

circumstances, concurrent receipt of DI and UI benefits can also be an 

indicator of improper payments. For example, some individuals who have 

a disability as determined by SSA may be receiving improper UI 

payments because they are not “able and available” for work. Similarly, 

some individuals receiving UI benefits may be receiving improper DI 

payments because they no longer have a disability as defined by SSA.26

The eight individuals we selected for further review received overlapping 

benefits in fiscal year 2010.

Specifically, being “able and available” for work may indicate that an 

individual’s medical condition no longer prevents him or her from 

performing work that rises to the level of SGA. As mentioned, neither SSA 

nor DOL have any processes to identify overlapping DI and UI payments.

As a result, neither SSA nor DOL currently evaluates whether overlapping 

payments made to these individuals may be proper or improper.

27 For example, one individual we selected 

from the top 50 recipients of concurrent benefits in our population 

received over $62,000 in overlapping DI and UI benefits in a single year. 

Of the $62,000 in overlapping benefits received by this individual,28

$27,528 were DI benefits and $34,534 were UI benefits.29

 

26 A person’s DI benefits may be terminated for a variety of reasons, including that the 

disabled beneficiary is no longer disabled because of a medical recovery or successful 

reentry to the workforce. 

In addition to 

receiving overlapping DI and UI benefits in both 2010 and 2011, SSA 

records indicate that the individual also received over $7,000 in earnings 

in these years. On the basis of our inquiries, state UI officials are currently 

reviewing the adjudication of this individual’s UI claim because these 

27 For our review, we obtained DI and UI information for these eight individuals beyond 

fiscal year 2010. Of the eight individuals we selected for further investigation, SSA 

determined that one individual had a DI benefit overpayment. Additionally, three 

individuals had UI benefit overpayments, as determined by the appropriate state UI office. 

Because we selected a small number of individuals for our review, the results cannot be 

projected to the population of individuals receiving overlapping DI and UI benefits.

28 Both DI and UI benefits are based on prior wages. In 2008, the individual earned over 

$100,000 in wages on which these benefits, in part, were based. 

29 Although the individual was eligible for DI benefits in 2009, SSA did not actually pay the 

DI benefits for most of 2009. According to an SSA official, the DI benefit payments were 

put on hold during a representative payee review. The individual’s SSA case file indicates 

that her disability is due to Affective Disorders and Substance Addiction Disorders 

(Drugs). If SSA determines a legally competent adult is unable to manage or direct the 

management of his or her own benefits, SSA appoints a representative payee. 
 

Page 12 GAO-12-764 Income Security 

earnings may be related to work that makes this individual ineligible for UI 

benefits. The Massachusetts UI benefits were exhausted after 99 weeks 

as of June, 2011. As of April, 2012, the individual remains in current pay 

status in the DI program, with a monthly DI benefit amount of $2,377.

Six of the individuals we selected for further investigation received 

overlapping DI and UI benefits for 18 months or more. For example, one 

individual began receiving DI benefits in 2004 originally due to disorders 

of the back, and received overlapping DI and UI payments, which totaled 

over $107,000, in 36 different months from 2008 to 2011. During that 

period, this individual worked for construction companies and received UI 

benefit payments from New Mexico in 2008, Wisconsin in 2009,30 Kansas 

in 2010, and Montana in 2011. Montana officials stated that they also 

received wage data from North Dakota for use in adjudicating the UI claim 

in their state. As of April, 2012, this individual was no longer receiving UI 

benefits from these states, but continued to receive cash benefits from 

the DI program. SSA officials told us that this individual is currently under 

a continuing disability review to determine if the beneficiary is ineligible for 

DI due to work at or above the SGA level.31

DI and UI provide important safety nets for American workers who have 

lost their income. However, both trust funds face serious fiscal 

sustainability challenges, prompting the need to examine opportunities for 

potential cost savings. While the programs target different populations 

and generally provide separate services, existing rules and definitions 

result in a limited number of individuals being eligible for overlapping DI 

and UI payments. However, the concurrent receipt of these benefits can 

also provide an indicator of improper payments related to DI or UI. 

Because these overlapping payments may be allowed under both 

programs’ eligibility requirements, and no federal law authorizes an 

automatic reduction or elimination of benefits if a recipient receives both 

payments, neither SSA nor Labor has a process to identify these 

overlapping benefit payments. As a result, for individuals receiving both 

 

30 This individual admitted to concealing work activity in order to receive UI benefits from 

Wisconsin in 2010. Wisconsin subsequently determined this individual would forfeit more 

than $2,900 in UI benefits as a result of this activity.

31 SSA conducts work-related continuing disability reviews (CDR) to determine if 

beneficiaries are ineligible for DI due to work at or above the SGA level. 20 C.F.R. §§ 

404.1589 - 404.1590.

Conclusions
 

Page 13 GAO-12-764 Income Security 

DI and UI benefits, the government is replacing a portion of their lost 

earnings not once, but twice. Reducing or eliminating this overlap and 

potential improper payments could offer substantial savings, though 

actual savings are difficult to estimate because the potential costs of 

establishing mechanisms to do so are not readily available.

We recommend that the Secretary of Labor work with the Commissioner 

of SSA to (1) evaluate the circumstances under which individuals are 

receiving overlapping DI and UI payments, taking appropriate action, as 

necessary, for any payments determined to be improper, and (2) assess 

whether cost savings or other benefits might be achieved by reducing or 

eliminating overlapping DI and UI cash benefit payments being made 

within the existing laws and regulations, seeking congressional authority 

to do so as appropriate.

We provided a draft of this report to SSA and DOL for comment. DOL and 

SSA provided written comments to the draft which can be found in 

appendices I and II. DOL and SSA agreed with our recommendation that 

DOL work with SSA to evaluate overlapping DI and UI benefits, taking 

appropriate action for any payments determined to be improper, and 

assessing whether cost savings or other benefits might be achieved by 

reducing or eliminating overlapping DI and UI cash benefit payments.

DOL and SSA also both recognized that the states play an important role 

in the UI program, and DOL recommended that we encourage states to 

participate in addressing the report’s recommendations. In this regard, we 

agree that states’ programmatic knowledge would significantly contribute 

to the evaluation of overlapping DI and UI benefits and encourage state 

participation as appropriate. We also believe that it will be important for 

DOL to reach out to the states in carrying out our recommendations to 

evaluate these overlapping benefits. DOL and SSA also provided 

technical comments, which we incorporated as appropriate.

As agreed with your offices, unless you publicly announce the contents of 

this report earlier, we plan no further distribution until 30 days from the 

report date. At that time, we will send copies to the Commissioner of the 

Social Security Administration, the Secretary of Labor, and other 

interested parties. In addition, the report will be available at no charge on 

the GAO website at http://www.gao.gov.

Recommendations for 

Executive Action

Agency Comments 

and Our Evaluation
 

Page 14 GAO-12-764 Income Security 

If you or your staff have questions about this report, please contact me at 

(202) 512-6722 or hillmanr@gao.gov. Contact points for our Offices of 

Congressional Relations and Public Affairs may be found on the last page 

of this report.

Richard J. Hillman

Managing Director, Forensic Audits and Investigative Service
Appendix I: Comments from Department of 

Labor

Page 15 GAO-12-764 Income Security 

Appendix I: Comments from Department of 

Labor 
Appendix I: Comments from Department of 

Labor

Page 16 GAO-12-764 Income Security 
Appendix II: Comments from the Social 

Security Administration

Page 17 GAO-12-764 Income Security 

Appendix II: Comments from the Social 

Security Administration
Appendix II: Comments from the Social 

Security Administration

Page 18 GAO-12-764 Income Security 
Appendix II: Comments from the Social 

Security Administration

Page 19 GAO-12-764 Income Security 
Appendix II: Comments from the Social 

Security Administration

Page 20 GAO-12-764 Income Security 
Appendix II: Comments from the Social 

Security Administration

Page 21 GAO-12-764 Income Security 
Appendix II: Comments from the Social 

Security Administration

Page 22 GAO-12-764 Income Security 
Appendix II: Comments from the Social 

Security Administration

Page 23 GAO-12-764 Income Security (192394)
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