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Key Moments from Ways and Means Hearing with Social Security Commissioner Martin O’Malley

March 25, 2024

WASHINGTON, D.C. – Ways and Means Committee Republicans secured a number of commitments from Social Security Commissioner Martin O’Malley to make reforms that protect seniors and taxpayers at a joint hearing before the Ways and Means Subcommittees on Social Security and Work and Welfare. These include preventing overpayments and offsetting regulatory actions that would cost taxpayers billions. Committee members highlighted several issues that have hurt seniors, disabled workers, and their families, namely improper payments that waste taxpayer dollars and leave beneficiaries on the hook for repayments years later, a disability application backlog of over 1 million, and telephone customer service that leaves beneficiaries waiting on the phone and not getting their issues resolved.

In addition, members pushed back on the Social Security Administration’s call for more taxpayer dollars to hire more bureaucrats, instead of adopting cutting-edge information technology to improve efficiency and customer service.

Smith Secures O’Malley Commitment to Work with Congress to Protect Seniors, Disabled Workers, and their Families from the Harm of Decades Old Debt due to SSA Inaction.

In fiscal year 2022 alone, Social Security made over $11 billion in overpayments. That same year, the SSA rolled back a policy barring recovery of overpayments when the Social Security Administration hasn’t taken certain actions to collect on them for more than a decade, leading to surprise collection notices for decades old debt. At the time, the SSA stated that it didn’t have the legal authority to bar recovery of such overpayments. Ways and Means Committee Chairman Jason Smith (MO-08) secured a commitment from Social Security Commissioner O’Malley to implement as quickly as possible any future authority that Congress provides the SSA with to protect seniors from repaying overpayments that linger due to SSA inaction. 

Chairman Smith: “In 2022, the Social Security Administration rescinded a policy that barred recovery of certain overpayments when the SSA had failed to act on them for 10 years. In a message to its employees, the agency noted that it rescinded this policy because it didn’t have the authority to bar recovery of those debts under the Social Security Act. In fiscal year 2022 alone, Social Security made $11 billion in overpayments across the Social Security and Supplemental Security Income programs, $2 billion of which resulted from the agency’s failure to use available data to avoid such mistakes. Commissioner O’Malley, if Congress provides you with the necessary authority, do I have your assurance that you will implement it as quickly as possible, so that more people are not penalized for the SSA’s failure to act in a timely manner?”

Commissioner O’Malley: “Yes, sir…We’re examining that even as we speak, as part of the other things that we’re doing on overpayments.”

Biden Administration Spending $100 Million to Equitably Add to the 1.2 Million Disability Backlog

The disability application backlog has grown to 1.2 million and counting. The SSA has struggled to process that volume of applications, with both the time to process an initial claim and the time to process an appeal of the initial consideration both being over 200 days. Instead of focusing resources on processing existing applications, the Biden Administration has earmarked at least $100 million over the last three years to increase initial disability applications, which SSA figures indicate could have added 135,000 claims to the backlog in FY 2023 alone. Social Security Subcommittee Chairman Drew Ferguson (GA-03) warned that SSA must focus on helping disability applicants receive timely and accurate decisions rather than focus on “equity” initiatives. 

Rep. Ferguson: “We have 1.2 million in the backlog. There was an effort because of equity initiatives to get more in…Do you think this has been an effective use, this $100 million dollars for equity initiatives? Has this been a good use of the limited resources of the administration?”

Commissioner O’Malley: “I think that depends on what we learned from that effort and what we do moving forward…”

Ferguson: “My free advice is to get the existing workload under control, get it back on track, before we go dumping more cases into it.”

The Law of the Land: Stop Executive Overreach That Sidesteps Congress and Would Cost Taxpayers $40 Billion in New Spending

In the Fiscal Responsibility Act, House Republicans fought to ensure increases in executive agency spending be offset, particularly executive actions that cost over $1 billion. In the last year, the Social Security Administration has proposed three new rules that would collectively cost taxpayers $40 billion. In response to Work and Welfare Subcommittee Chairman Darin LaHood (IL-16), Commissioner O’Malley committed to following this law that requires the agency to pay for or offset this new spending or seek a waiver, protecting taxpayer dollars and providing transparency about agency efforts to sidestep Congress and expand the size of entitlement programs through regulatory actions.

Rep. LaHood: In the past year, SSA has published at least three proposed rules that exceed $1 billion in estimated costs. Number one, ‘Omitting Food From In-Kind Support and Maintenance Calculations,’ proposed rule with a cost of $1.5 billion. Number two, the ‘Expand the Definition of Public Assistance Household’ proposed rule with a cost of $15.9 billion; and three, the ‘Intermediate Improvement to the Disability Adjudication Process,’ proposed rule with a cost of $20.3 billion. SSA has indicated it plans to finalize these rules sometime in 2024. Commissioner, does the SSA intend to comply with the FRA [Fiscal Responsibility Act] and the clear requirements there and publish information regarding how the cost of these rules will be offset through other administrative regulatory actions? If not, will OMB [Office of Management and Budget] be issuing a waiver for such requirements?”

Commissioner O’Malley: “As I was listening and looking through my own list, I do believe that I was the Commissioner that approved all three of those…They will be published in due course, and we will of course, abide by the law of the land in terms of finding offsets or asking for waivers.