With the new Trump Administration being elected to office earlier this year, many sweeping changes have been made to federal agencies and their systems. The Social Security Administration (SSA) is amongst the agencies that have had changes enacted to it.
This restructuring within the agency has now begun to impact the millions of retirees who are dependent on these monthly benefit checks. For the most part, these charges to the welfare program are being enacted by the Department of Government Efficiency, or DOGE, which is run by tech billionaire Elon Musk who is supported by the president himself. DOGE was introduced into the SSA with the aim of slashing federal spending.
DOGE’s impact on Social Security
Since its introduction into the agency, DOGE has made some major changes to the program. The workforce had been downsized by around 7,000 employees, and several SSA offices had been shuttered citing low foot traffic. The most shocking change, however, has been the increase to the withholding rate for beneficiaries with overpayment balances. Critics have shared that these changes are going to have significant repercussions on vulnerable Americans.
Social Security benefits are an integral source of income for millions of vulnerable individuals such as retirees or those living with disabilities. And it is this very cohort of individuals who are already feeling the effects of the recent changes with the SSA. According to Monique Morrissey, an economist at Economic Policy Institute, a left-leaning group, low income seniors and individuals with disabilities will be the most impacted by these DOGE-implemented changes. This is because these groups are reliant on in-person support and the closure of offices and downsizing of staff adds unnecessary difficulty to the process.
“People trying to access retirement benefits will also face delays,” she stated. “Some people eligible for disability income and Supplemental Security Income (SSI) will lose out permanently from service delays and disruptions in accessing these benefits.”
Morrissey further observed that website crashes are increasing and if potential beneficiaries try to apply online without guidance from an agent, they might miss out on benefits that they are actually entitled to.
Overpayment withholding rate jumps up
There are certain occasions wherein a beneficiary will receive more money than they are entitled to due to an error with personal information or a mistake on the agency’s part. Often, the recipient will be completely unaware of this mistake until a notice of overpayment shows up at their door.
Previously, in these cases, the agency would withhold a maximum of 10% of the beneficiary’s monthly check until the overpaid balance was cleared. However, in March, the Trump Administration announced that it would be increasing this withholding rate to 100%. Naturally, this sparked harsh criticism, with some even calling the decision “draconian and cruel.”
“It’s retribution without actual wrongdoing,” said Morrissey. “Except in rare cases, these overpayments are accidental, including mistakes by the Social Security Administration—and not attempted fraud.”
Subsequently, a few weeks later in April, an emergency meeting was held at the SSA to rework the decision and it was then decided that the withholding rate would now be capped at 50% of an individual’s benefit. Experts still feel that this clawback rate is too harsh and it will hurt the most vulnerable the most, such as “recipients who live on fixed incomes and those who aren’t even aware they’ve been overpaid.”
Whilst this welfare system is running fine — for now — Morrissey advises those who need to make changes to their personal information or banking details to wait on it as it may not be the most ideal time.
The SSA has recently made changes to its process of identity verification by removing the option to do so via telephone. This means that beneficiaries would have to visit an office in person if they cannot do so online. However, service delivery has been slow due to cutbacks so beneficiaries should also brace themselves for lengthy wait times when trying to make an appointment with the agency.