Terry’s Columns A Victory on Social Security Horror Stories

A Victory on Social Security Horror Stories

By Terry Savage on March 15, 2024

We made a difference! At last some good news for victims of Social Security clawbacks. These Social Security Horror Stories revolve around the individual pain caused by Social Security’s mistaken benefit calculations and demands for repayment going back as far as 30 years.

The Agency has been in the process of clawing back $21.6 billion of “overpayments” — some over $100,000 — from the retired elderly and disabled. These sudden and unexplained demands – and their threats to completely stop ongoing benefit payments – caused panic among the elderly.

Now all that is about to change under new Social Security Commissioner Martin O’Malley, who just this past week called the clawbacks “cruel-hearted and mindless”!

Social Security Horror Stories
Famed economist Larry Kotlikoff and I detailed these horror stories on 60 Minutes last November – and in our book Social Security Horror Stories. Anderson Cooper was astounded at the cruel actions of Social Security as he interviewed some of our victims. At the end of the show, Cooper announced that the clawbacks had been waived for the three families that were featured.

But that wasn’t enough to help the nearly 2 million Americans caught in this unfeeling bureaucratic clawback. Benefits clerks routinely denied waivers, and the appeals process was one-sided, with judges paid by Social Security.

During the program we advocated for an 18 month clawback limitation, a suspension of clawback demands until reviewed, using due process, by a higher level committee, and a resumption of benefits that had been stopped.

Behind the Scenes
Since that 60 Minutes story aired, Larry and I have been meeting with Treasury officials. (The Secretary of the Treasury is chair of the Social Security board of trustees.) We detailed our plan for restoring “equity and good conscience” to the Agency, as required by its bylaws, including the steps outlined above.

This past week the Kaiser Family Foundation Health News, which had also been demanding change, quoted new Social Security Commissioner Martin O’Malley as telling them: “In the coming days he would propose changes to help people avoid crushing debts that have driven some into homelessness and caused financial hardships for the nation’s most vulnerable — the poorest of the poor and people with disabilities or persistent medical conditions or who are at least age 65.”

And the headlined article goes on to quote the new Commissioner: “He said he has concrete steps in mind, such as establishing a statute of limitations, shifting the burden of proof to the agency, and imposing a 10% cap on clawbacks for some beneficiaries.

That is almost exactly the wording we proposed in our book Social Security Horror Stories — AND in our interview with Anderson Cooper on 60 Minutes last November! We sent those same comments to the Treasury Department two months ago, as they asked for our suggested changes.

What’s Next?
For the many hundreds of you who wrote to us, and posted on our website – www.SocialSecurityHorrorStories.com – this is very welcome news! But where does it leave people still caught in the clawback process.

What will happen to:
• The 94 year-old with dementia, who has $9K to her name? Will she now receive the $10 per month repayment plan they offered, or will she have to repay the $14K they are still demanding?

• Will the disabled nurse who earned a bit too much by risking her life to work overtime during COVID be forced to pay back $34K, which will leave her penniless?

• Will the blind disabled lady (featured in Larry’s most recent Substack column) be forced to pay back $34K for disability overpayments alleged, with no proof, to go back 23 years.

The Commissioner’s announcement was a welcome first step. We thank him, and Treasury Secretary Janet Yellen, who were obviously moved to act quickly when they were made aware of this outrageous bureaucracy run amok.

But now we need more than words. We need specific and quick actions to restore benefits and lift the threat of clawbacks from the lives of the disabled and elderly. So, we will keep pushing for an action plan, and keep you updated at our website — www.SocialSecurityHorrorStories.com.
That’s The Savage Truth.



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