Why do people think the SSD system is ripe with fraud?

  Terry Katz & Associates  |  September 24, 2014  | Last modified on October 18th, 2018 | 

When talks began back in 1938 about implementing a benefits system for the disabled, some expressed concerns about the potential for fraud and how it should be handled. As was noted then, it would cost the government a considerable amount of money to weed out illegitimate cases, possibly even far more than could be forecasted.

Flash forward to today and you will see that we have the same problem: concerns about fraud and questions about how to handle it. But why do people think that Social Security Disability is so ripe with fraud? It’s a question we hope to answer for our readers in this week’s post.

According to some people, there are two main things that are perpetuating further fraud in the SSD system. The first is the claims process itself and the second is the lack of infrastructure, including administrators and fraud-prevention systems.

The reason some people point to the claims process itself as a source of fraud is that of the screening process used to determine benefit eligibility. From screening medical information to processing claims to updating the disabilities list, some people claim that the non-integrated system currently at work at the Social Security Administration does little to catch dishonest cases.

But there are several things wrong with this assessment. One issue is updates to the disabilities list. The SSA adds to Compassionate Allowances on a regular basis, which leads to faster processing times. The scrutiny placed on these faster processing times is then unfounded, because a quick turnaround in an application may not indicate fraud at all but rather a legitimate claim.

The second thing some people say that is helping fraud is the infrastructure within the SSA. This includes everything from the number of workers currently employed to work on disability applications to the computer systems used by these workers.

It’s true that the systems used to process claims may not be up to date and that the ratio between administrators and the number of claims they must process is disproportionate. And while this might lead to a few illegitimate cases getting through, it’d be illogical to then say that all cases are fraudulent.

Unfortunately, the focus on catching fraudulent cases overshadows the countless number of legitimate claims that get processed every year. In the minds of the public, all cases are illegitimate when this simply isn’t the case at all.

Source: FedSmith.com, “SSDI: A Program Subject to Abuse,” Ian Smith, Sept. 14, 2014

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