Dead people and Social Security
Dean Baker was polite in responding to another story from the Washington Post in the campaign to discredit the program:
That’s what the headline of the front page Washington Post story might have read if the purpose was to inform readers. Instead the lengthy piece (which covers the whole back page) told readers that Social Security paid out $133 million in benefits to people who were dead over the last three years.
While it is useful to weed out such improper payments, this piece likely led many readers to wrongly conclude that such payments are a major cost to the program. They are not. Nothing about the finances of Social Security would be noticeably changed if the amount of such improper payments were immediately reduced to zero.
If the Washington Post followed the NYT’s commitment to putting big numbers in context, it would have expressed $133 million as a share of the $2102 billion paid out in benefits over the relevant time frame. That way readers would realize that these mistakes have little impact on the program’s financial condition.
I wonder how much of the payments to dead people were returned. When my uncle died, he received one or two months of SS payment before they stopped. SS contacted his executor and the money was promptly returned.
I am surprised that it was more than one month. In general the funeral home notifies social security of the death (at least they did in my parents cases) and the payments stop. (Partly this is because if it is the first to die there is a $225 benefit involved). Are the funeral homes that don’t notify social security.
Anyway the whole process of death notification is a mess. The county issued a death certificate, but the drivers license folks never got the message so that 4 years later they were asked to renew their drivers licenses. Further because jury calls are based on drivers licenses, my dad got called for jury duty 8 years after he passed. I called the court and suggested a seance, but thought the judge might not agree.
a former office manager for SS informs me that SS pays for each month during the next month. So, for example, you get your check for July on August 3. If you die in July, even on the last day, that August 3 check has to be returned. If you are dead it is hard to see to this personally, so your grieving spouse or children have to figure this out on their own.
I am not sure how much of that “payments to dead people” includes these late payments, which i assume are eventually recovered. at least I wouldn’t try to cash a check sent to a dead person… even if i paid for their groceries and rent and care in that last month. perhaps i would give it to the lawyer in charge of the estate, and he would tell me i have to send it back to SS.
so it’s not clear to me that the issue is strictly the dishonest use of math to imply that it’s a huge problem. it may be the dishonest use of facts to imply that it is a problem at all.
For those who have had a parent pass away and dealt with the funeral home, how many of the funeral homes notified social security? It seems to me because the funeral home also in general applies for the death certificate, that they should do so. I do know that my father died on the 22 and did not get the next check, so the cutoff must be later than that. (likley around the 26th)