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Grassley flags $1.4 billion/yr in overpayments under Social Security
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(He says they could have been easily prevented.)
The following was first published on SHARYL ATTKISSON‘s free Substack.
Sen. Chuck Grassley (R-Iowa) is turning up the heat on the Social Security Administration (SSA), demanding answers and action over verification failures that led to an estimated $718 million in improper Supplemental Security Income (SSI) payments.
That, according to official reports, is just a fraction of $1.4 billion in overpayments in 2021 alone that might have been fended off with proper action.
A veteran watchdog of government waste, Grassley has been watching the SSA on this very issue for over 20 years, leveraging his clout as a senior member and former chairman of the Senate Finance Committee, where he now chairs the Subcommittee on Social Security, Pensions, and Family Policy.
The problem stems from the SSA’s sluggish use of the Access to Financial Institutions (AFI) tool—a secure system that cross-checks bank account balances to ensure SSI recipients and applicants actually qualify for benefits.
A September 2024 report from the Social Security Office of Inspector General (IG) pegged the $718 million figure to 198,960 recipients who hid financial assets, based on sample data. Grassley argues that broader, more frequent use of AFI could stop these overpayments in their tracks, saving taxpayers millions—potentially billions.
The IG has long pushed SSA to expand AFI checks beyond initial claims and sporadic “redeterminations”—reviews of non-medical eligibility that can lag anywhere from one to six years for most recipients.
A 2018 IG report revealed SSA hadn’t reassessed 1.1 million recipients in over a decade, estimating that $1.4 billion in overpayments could’ve been avoided in 2021 alone with regular AFI scans. Yet, SSA keeps dragging its feet, citing an unfinished study as an excuse.
Grassley’s frustration also zeroes in on SSA’s policy of skipping AFI verifications for anyone reporting less than $400 in liquid assets. This loophole leans heavily on self-reported data, and a recent IG sample of 140 unverified cases found 27 recipients wrongly pocketed $130,430. Past SSA studies echo the need for reform, but the agency remains stubbornly stagnant, according to Grassley.
With every misspent dollar robbing legitimate beneficiaries, Grassley’s latest oversight salvo insists SSA detail its plans to ramp up AFI use and curb the hemorrhaging of taxpayer funds.
Grassley is demanding the Social Security Administration’s Acting Director provide answers to a list of specific questions about the lost taxpayer funds:
- With regard to the expansion of AFI usage between the initial benefit approval and subsequent redeterminations:
Who is conducting the study, and what is its status?
Describe the scope of and methods used for the study, including any new information it seeks beyond that already known from previous studies.
Provide a timeline for completion of the study to include descriptions and dates of objective milestones and steps taken to ensure the study is completed on time.
How will the study be used to make changes to AFI usage, and what is the timeline for these changes?
Provide a copy of the completed study.
- With regard to using AFI verification for those reporting balances under the $400 threshold:
Who is conducting the study, and what is its status?
Describe the scope of and methods used for the study, including any new information it seeks beyond that already known from previous studies.
Provide a timeline for completion of the study to include descriptions and dates of objective milestones and steps taken to ensure the study is completed on time.
How will the study be used to make changes to AFI usage, and what is the timeline for these changes?
Provide a copy of the completed study.
- According to the September report, the IG asked SSA why additional research is needed to reduce the liquid resource level of cases subject to AFI verification to below $400.31 SSA responded:
Reducing the SSI resource tolerance used for AFI to zero would involve a very large increase in the total number of AFI queries, as most beneficiaries and applicants have alleged resources under $400. Because of this, it would require a re-negotiation of our AFI contract with the vendor, increasing the contract cost. It would also increase the redeterminations and initial claims workloads for field office technicians. Because there would be significant costs associated with the change, a focused study is desirable to quantify and accurately compare the costs and benefits.
Provide the total number and type of expected additional queries, from SSI applications, per individual case and in aggregate, and how those numbers were determined.
Provide the total number and type of expected additional queries from redeterminations, per individual case and in aggregate, and how those numbers were determined.
Provide the estimated additional workload for each additional query in terms of employee hours worked, employee costs, and any other costs.
What are the costs and benefits that will analyzed by the study, as the statement describes?
Provide a copy of the AFI vendor contract.
Have the terms of the AFI vendor contract, pertaining to cost of an individual query or total cost of the contract, changed since its origination in 2011? If so, how?
The IG report stated that, per SSA, its contract for AFI use cost $10.3 million in FY 2022.33 What was the cost in 2023 and 2024 and what does the taxpayer get for it?
- The IG report states: “In January 2023, SSA reported its AFI vendor had a total of 9,976 financial institutions on file; 8,144 were participating institutions that responded to requests for financial information and 1,821 were non-participating institutions that did not. SSA could not explain why some institutions chose not to participate in the AFI process.”
Explain the process by which financial institutions are put on file and participate.
Have you had any discussions with the vendor about improving financial institution participation?
According to a May 2024 IG report, SSA last updated the AFI program in January 2016 when it added a search feature to identify financial institutions by routing number.
Have the capabilities of the AFI application been changed or improved since that time? If so,how?
Has SSA changed or expanded the use of AFI to verify financial accounts of SSI applicants or recipients in any other way? If so, how?
Has SSA used or considered use of any other tool, beyond AFI, to electronically or automatically verify financial accounts and reduce improper payments?
Read Grassley’s letter on the subject here.
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April 5, 2025 at 07:21AM
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