WASHINGTON, D.C. – After nearly nine years, and intense oversight from Ways and Means Republicans, the Social Security Administration (SSA) has taken the first concrete step to use a payroll information exchange (PIE) to prevent overpayments before they begin. The SSA’s use of a PIE will help reduce improper payments sent by the SSA as a result of inaccurate or untimely wage reporting, one of the primary causes of improper payments across the Social Security and Supplemental Security Income programs.

Ways and Means Committee Chairman Jason Smith (MO-08) issued the following statement:

“It is unfortunate it took the Social Security Administration close to a decade to implement what is clearly a commonsense measure to utilize data that can prevent costly errors, reduce the wage reporting burden on beneficiaries, and increase the accuracy of Social Security payments. Improper payments not only drain valuable resources from the Social Security programs, they also plague beneficiaries with unplanned expenses and the undue stress of resolving the issue with the SSA.

“For years, the Ways and Means Committee has demanded that the agency act on the authority and swift timeline that the SSA received from Congress. While it is good that the SSA has taken this first step, the Committee will continue to exercise its oversight authorities to ensure that the important tool is used effectively and hold the bureaucracy accountable to protect American taxpayers and working families.”

Background:

• The Bipartisan Budget Act of 2015 provided the SSA authority to enter into a payroll information exchange and mandated the agency propose a regulation within one year of enactment.
• In Fiscal Year (FY) 2022, the Old-Age, Survivors, and Disability Insurance (OASDI) programs are estimated to have made more than $8.3 billion in combined improper payments, more than three times as much as in FY 2021 – including nearly $6.5 billion in overpayments. 
• The Supplemental Security Insurance (SSI) program made $4.6 billion in overpayments in FY 2022, an increase of more than $500 million from FY 2021.
• On February 15, 2024, SSA finally published a proposed rule related to the implementation of a PIE.
• Because of the prevention in overpayments, the SSA Chief Actuary estimates implementation of a PIE will result in a net reduction in program spending of $1.1 billion in OASDI payments and $1.8 billion in SSI payments over the coming decade.

READ: Chairman Smith: Social Security Must Use Every Tool to Fight Improper Payments

READ: Four Key Moments from the Ways and Means Social Security Subcommittee Hearing on Improper Payments
READ: Smith, Ferguson, LaHood Call on Social Security Administration to Comply with Law, Implement Improper Payment Protections