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Terry Savage: Commissioner steps up to address Social Security horror stories

Terry Savage, Tribune Content Agency on

New Social Security Commissioner Martin O’Malley has just taken a major step to offer immediate relief to those facing clawbacks from his agency.

Economist Larry Kotlikoff and I detailed these horror stories on "60 Minutes" last November — and in our book "Social Security Horror Stories." Millions of Americans have been or are due to be contacted by the Social Security Administration (SSA) with a demand to repay past benefits based on SSA's mistaken calculations, some going back as far as 30 years.

In a message to SSA employees, O'Malley announced the first of several initiatives to make the system work more fairly. His words speak volumes:

“Effective today, instead of initially withholding 100% of a Social Security benefit to recover an overpayment, we are changing the default overpayment withholding rate to 10% (or $10, whichever is greater) of a person’s total monthly benefit. For many beneficiaries with an overpayment, this change significantly reduces the financial hardship they may face.

"We are developing the systems updates so that in a few months our systems will automatically use the 10% default rate for new overpayments. But for now, our systems will continue to initially withhold 100% of a person’s benefit to recover an overpayment. During this interim period, I am relying on our front-line staff to manually adjust the withholding for beneficiaries who request a lower rate. We appreciate you making these adjustments while we update our systems.”

In simple words, the elderly and disabled recipients of Social Security retirement and disability benefits will no longer face the threat of imminent stoppage of all their benefits unless the clawback demand is repaid.

 

Instead, from this moment on, the clawback will be no larger than 10% of a person’s monthly benefit, or $10, whichever is more.

Of special note, until the clawback form can be adjusted in the next two weeks, the commissioner instructs SSA employees to immediately adjust the withholding amount if anyone calls to complain!

That’s YOUR call to action! If your benefits have been suspended or substantially reduced because of a clawback, you should immediately call the SSA at 800-772-1213 and ask for the 10% adjustment!

(The commissioner has also demanded that wait times be reduced for those calling in, and they are currently averaging only 31 minutes.)

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