Manchin, Flake Introduce Bill to Stop Double-Dipping in Benefits
The Reducing Overlapping Payments Act will reduce rampant waste, fraud and abuse in the system
Washington, D.C. – On Tuesday, U.S. Senators Joe Manchin (D-WV) and Jeff Flake (R-AZ) introduced the Reducing Overlapping Payments Act, legislation to prevent individuals who are actively collecting unemployment benefits – and who, by definition, must be “able and available for work” – from simultaneously collecting disability benefits intended for those who cannot work.
The legislation would require the Social Security Administration (SSA) to temporarily suspend Disability Insurance (DI) benefits during any month in which a beneficiary also receives Unemployment Insurance (UI) benefits. DI beneficiaries who receive overlapping DI and UI benefits in a given month will merely have their DI benefits suspended for that month. Their eligibility for the DI program would not be affected.
The bill would also authorize the SSA to enter into agreements with states and agencies that administer unemployment compensation to ensure that the SSA has the necessary information to identify overlapping DI and UI payments. The bill would not affect retirees who collect Old-Age and Survivors Insurance Trust (OASI). It would also not affect DI-dependent beneficiaries’ ability to receive UI benefits.
“The facts remain that our national debt now exceeds $18 trillion and many of our vital benefits programs continue on an unsustainable path. It’s not just common sense; it’s essential to get rid of the waste, fraud and abuse rampant in our system in order to make sure those who truly need benefits will continue to receive them,” said Manchin. “Those who are on Social Security Disability Insurance are supposed to be unable to work and those on unemployment insurance are supposed to be actively searching for job opportunities. It doesn’t make sense that individuals are allowed to collect these two checks at the same time. I am proud to co-sponsor this proposal that strengthens our entitlement system by prioritizing our resources based on our values, while also keeping our promises to those Americans who need support during difficult times.”
“Doing nothing while hundreds of millions of dollars are dishonestly siphoned out of entitlement programs defies logic, math and an honest assessment of how we can continue to serve those who legitimately rely on them,” said Flake. “It’s past time for Congress to send bipartisan entitlement reforms such as this one to the president’s desk.”
Background:
The Disability Insurance (DI) program was designed as a safety net of last resort for disabled Americans who cannot work. The Unemployment Insurance (UI) program was designed as a safety net for unemployed Americans who are actively seeking work.
Such inconsistent eligibility requirements allow individuals to be simultaneously classified as both “able and available for work” under the UI program and “disabled” under the DI program.
In fiscal year 2010, 117,000 individuals received overlapping DI and UI benefits totaling more than $850 million, according to the Government Accountability Office (GAO). These overlapping payments cost the DI program more than $281 million and the UI program more than $575 million, that year.
The costs associated with these overlapping payments exacerbate the financial challenges these programs face. According to the GAO, the DI and UI trust funds “face serious fiscal sustainability challenges.” Additionally, the Social Security trustees predict that the DI trust fund will be completely exhausted by 2016.
Although the SSA is required to reduce DI benefits for individuals receiving certain other government benefits (such as workers’ compensation), “no federal law authorizes an automatic reduction or elimination of overlapping DI and UI benefits,” according to the GAO. Even President Obama proposed closing this “loophole” as a “critical step to save money” in his fiscal year 2014 budget. However, absent legislation such as S. 343, the SSA cannot address these overlapping payments.
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