When an individual passes away, their family is supposed to receive a one-time death benefit and then the Social Security payments stop. The SSA is supposed to record the deaths of these individuals to ensure that payments stop and that the proper federal agencies and private companies are notified so that families or other interested parties do not wrongly receive benefits after these individuals pass away. Unfortunately, a report released by the SSA’s inspector general states that the government failed to report the death of nearly 1.2 million individuals.
What does this failure to report deaths mean? Over the course of several audits performed in recent years, it has been found that the government has paid benefits from farm subsidies to Medicare years after people who were supposed to be receiving them died. It does appear that the Social Security benefits that were being paid to these individuals did stop once the people passed away, but because the SSA failed to report the deaths the families of these individuals continued to receive other benefits, including the farm subsidies.
Federal agencies and private companies rely on the report issues by the Social Security Administration (SSA) to determine whether or not people who are receiving certain benefits are still eligible for those benefits. With the failure to report 1.2 million deaths, that is 1.2 million people who were receiving benefits of some form after they died.
Receiving government benefits, however, is not the only issue that comes as a result of failing to report the deaths. When an individual is not reported to be deceased by the SSA, private companies such as banks and credit agencies have no way of knowing that the individual is no longer alive. As a result, it is possible for identity thieves to use the Social Security number of the deceased to open lines of credit and conduct identity theft. This can cost lenders millions in identity theft fraud.
The reason behind the failure to report the deaths was poor recordkeeping. The auditors recommended to the SSA that they do a better job in matching deaths that have been recorded on its benefit rolls with the master list and improve their recordkeeping procedures. The SSA has agreed with the recommendations. Unfortunately, the actions came too little too late as the failure to report the deaths of these 1.2 million individuals and properly maintain the database has already cost the taxpayers of this nation millions of dollars per year.
With an already-struggling budget, the SSA has little room for error. While they may have been efficient enough to stop Social Security payments when these individuals passed on, they failed to protect the public and taxpayer money by properly reporting the deaths. Hopefully the lesson has been learned and the SSA will be more careful in the future in regards to proper recordkeeping and reporting of deceased individuals.