Don't Believe Everything You See about Social Security. Please.

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74. Not simple, to provide summary.

Testimony by Martin O'Malley
Commissioner, Social Security Administration,
before the Senate Committee on Aging

March 20, 2024

THE CURRENT STATE

Social Security Is Serving More Customers Than Ever Before with Fewer Staff Than Ever Before.

By the end of FY 2024, SSA will serve over 7 million more beneficiaries with about 7,000 fewer full-time permanent staff when compared to FY 2015 (Figure 1). While modernization and other efficiencies have helped for some things, there is no way around the fact that the agency cannot keep doing more with less.

SSA Has Extremely Low Operating Expenses.

Members may be surprised to learn that Social Security has now been reduced to operate on less than one percent of its annual benefit payments. This is extremely low – much lower than private insurance companies. For instance, Allstate operates on 19 percent of its annual benefit payments, and Liberty Mutual operates on nearly 24 percent of its annual benefit payments.

Our Service and Customers are Suffering.

As a result of this historic underfunding and understaffing, Social Security faces a service delivery crisis. The situation is dire, and the public we serve is paying the price as they attempt to access the benefits that they have already worked their whole lives to earn. For example:

Backlogs in the States continue to grow.

HOW WE’RE ADDRESSING THE SERVICE DELIVERY CRISIS

As soon as I was sworn in three months ago, I announced my intent to focus the agency on three key service delivery challenges in 2024: disability determination wait times, National 800 Number wait times, and overpayment and underpayment inequities.

SecurityStat

On February 5, 2024, we launched SecurityStat, standing biweekly leadership meetings to track and align on key performance outcomes across rotating challenges. Many of you have kindly sent your staff to observe this new way of doing business at SSA. Your attention, your interest, and the presence of your staff at our side have been more deeply appreciated than you can know.

Overpayments and Underpayments

Our deeper understanding of the complexities of this problem has set us on the following course of action:

Starting next Monday, March 25, we will be ceasing the heavy-handed practice of intercepting 100 percent of an overpaid beneficiary’s monthly Social Security benefit by default if they fail to respond to our demand for repayment. Moving forward, we will now use a much more reasonable default withholding rate of 10 percent of monthly benefits — similar to the current rate in the SSI program.

We will be reframing our guidance and procedures so that the burden of proof shifts away from the claimant in determining whether there is any evidence that the claimant was at fault in causing the overpayment.

For the vast majority of beneficiaries who request to work out a repayment plan, we recently changed our policy so that we will approve repayment plans of up to 60 months. To qualify, Social Security beneficiaries would only need to provide a verbal summary of their income, resources, and expenses, and recipients of the means-tested SSI program would not need to provide even this summary. This change extended this easier repayment option by an additional two years (from 36 to 60 months).

And finally, we will be making it much easier for overpaid beneficiaries to request a waiver of repayment, in the event they believe themselves to have been without any fault and/or without the ability to repay.

Our FY 2025 Budget

I am confident that with the rapid cadence of accountability and collaboration that SecurityStat provides, and continuous solicitation of areas for improvement from employees and customers, we will begin to make forward progress. But we cannot do it alone; we need your help to ensure we have the necessary funding and staffing.

As the mayor of a cash-strapped city and then a recession-era governor, I’m quite familiar with operating on tight budgets. I also spent nearly a year intensely studying SSA materials from the outside before my confirmation. Even with all of that, SSA’s budget is far more dire than I thought. Years of underfunding have decimated our staffing levels and therefore also our ability to serve the public.

Coming off a challenging budget year in FY 2024, it is critical that we receive adequate funding in FY 2025. Approval of the FY 2025 President’s Budget request of $15.4 billion for SSA would allow us to begin making progress toward improving customer service.