The Government Accountability Office (GAO) just released a report that confirmed what anyone who knows anything about Social Security already knows (which, apparently, does not include Social Security’s Commissioner) — Social Security’s staff are routinely making major mistakes in advising people about their Social Security benefits — mistakes that are costing people potentially tens to hundreds of thousands of dollars.
To quote a part of the report,
The GAO observed 30 in-person claims at SSA field offices and found that claimants were not consistently provided key information that people may need to make well-informed decisions. For example, in 8 of 26 claims interviews in which the claimant could have received higher monthly benefits by waiting until a later age, the claims specialist did not discuss the advantages and disadvantages of delaying claiming. Further, only 7 of the 18 claimants for whom the retirement earnings test could potentially apply were given complete information about how the test worked. SSA’s Program Operations Manual System (POMS) states that claims specialists should explain the advantages and disadvantages of filing an application so that the individual can make an informed filing decision. The problems we observed during the claims interviews occurred in part because the questions included in the claims process did not specifically cover some key information.
This is a strong criticism, but it doesn’t begin to suggest the magnitude of Social Security’s mistakes. Here’s an example. It’s the case of a gentleman named Andrew Bronny who used my company’s Maximize My Social Security software to figure out how to maximize his household’s lifetime benefits. The software correctly told him that his wife could file just for a full spousal benefits (half of Andrew’s full retirement benefit) when she turned 66 in November because she turned 62 before January 2, 2016. But here’s what Andrew just wrote me. I get emails like this almost every day.
I just off the phone w SS. They called me. This was the five day-after receiving the online application-phone call to verify our marriage and intent to file a restrictive application for spousal benefits. The agent advised me that I had done everything right in my approved file & suspend application last year, but that spousal benefits were not available as my spouse was not,
“66 April 30, 2016″. I stated that she was 62 or older at the end of 2015, will reach FRA November, 2016, and is eligible for spousal benefits as per the Bipartisan Budget Act of 2015. I asked to speak with her supervisor.
After a 3 minute delay the same agent was back on the phone and stated that I was absolutely correct, (“These rules change daily”) and that benefits would be confirmed in a mailing.
There is still a huge disconnect within SSA. The rules don’t change daily. The information supplied to the agents, or agents’ interpretations, has probably cost huge numbers of applicants denial of legal benefits. As you have stated, the rules are complex. Complex indeed. Woe to the unsophisticated applicant. Thank you for making me sophisticated.
Andrew is on target. In his case, the agent based her initial response on highly misleading to the point of being wrong instructions issued by Social Security about the new law passed last November. It took Social Security till mid February (coincidentally within a day of a conference call I had with some of their top officials pointing out precisely the mistake that almost snared Andrew) to send its staff revised instructions. Even the new instructions were hard to follow.