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Social Security Watchdog Finds $291 Million in Unpaid Disability Benefits
0 Share Newsweek is a Trust Project member See more of our trusted coverage when you search. Prefer Newsweek on Google to see more of our trusted coverage when you search. The Social Security Administration failed to pay an estimated $291 million in Supplemental Security Income (SSI) underpayments that were owed to recipients, according to a new watchdog report examining millions of unresolved payments.
The SSA Office of the Inspector General report, released Friday, found that agency employees did not always take the actions required to resolve underpayments sitting on recipients' records. Based on a statistical sample, auditors estimated that around 1.1 million outstanding underpayments totaling about $291 million had not been paid.
The figure refers to individual underpayments rather than 1.1 million separate people, meaning one recipient could potentially account for more than one payment.
Newsweek has contacted the SSA via email for comment.
SSI provides monthly payments to people with limited income and resources who are disabled, blind or aged 65 and older. While it is often associated with disability benefits, it is separate from Social Security Disability Insurance (SSDI), which is based on a worker's employment record. An average of 7.3 million people received federal SSI payments each month during 2025, including about 6.1 million blind or disabled recipients and 1.1 million recipients qualifying due to their age.
An underpayment occurs when the SSA pays someone less than they were entitled to receive, makes no payment when one was due, or issues a correct payment but the recipient dies before cashing the check, the OIG said.
Underpayments can arise when the SSA subsequently changes a recipient's record in a way that increases the amount they should have received for an earlier period, or when an application is approved and retroactive benefits are due.
Auditors identified approximately 2.5 million SSI underpayments that were still pending on SSA records as of September 2024. Of those, about 1.14 million related to living recipients and roughly 1.37 million to deceased recipients. The watchdog then examined a random sample of 160 of those pending underpayments.
It found that SSA employees failed to take the required steps to pay 69 of the 160 sampled underpayments. Based on the sample, the OIG estimated that SSA had failed to pay approximately 610,000 underpayments totaling $195.7 million to living SSI recipients, along with around 444,000 underpayments totaling $94.9 million that should have been paid to recipients before they died or, where applicable, to eligible survivors.
Some of the incorrect payments had been left unresolved for years. Underpayments involving living recipients on terminated SSI records had remained pending for an average of 18 years, while those examined involving deceased recipients had remained pending for an average of 22 years.
In one case used as an example in the report, the SSA determined that a recipient had been underpaid by $1,549 but terminated the person's SSI record without releasing the money. The individual later applied for SSI twice more, but the outstanding payment was still not issued. As of December 2025, it remained unpaid.
The OIG said it could not determine why employees failed to properly resolve the underpayments. SSA officials told auditors that limited system notifications made some outstanding payments difficult to track and that underpayments attached to terminated records or deceased recipients generally require manual processing.
Improper payments are not limited to the underpayment cases identified in the audit. Overpayments, where the SSA pays more than someone is entitled to is also classed as an improper payment type.
The SSA says the overwhelming majority of its traditional Social Security payments are accurate. In fiscal year 2024, Old-Age, Survivors and Disability Insurance payments were 99.79 percent free of overpayments and 99.93 percent free of underpayments.
SSI, however, has a higher error rate. During the same year, 89.97 percent of SSI payments were free of overpayments and 98.45 percent were free of underpayments. Because of the enormous sums SSA distributes, even relatively small percentage errors translate into billions of dollars: the SSA estimated improper payments of about $4 billion across all programs and $7.3 billion in SSI in fiscal 2024.
SSI is particularly difficult to administer because eligibility and payment amounts can change according to a recipient's income, resources and living arrangements. The SSA's 2026 SSI report says the agency must calculate eligibility monthly, meaning changes occurring after a payment is initially calculated can subsequently make that payment incorrect.
Overpayments are generally much larger than underpayments. SSA has said undisclosed financial accounts and wages are major drivers of SSI payment errors, while its latest congressional budget justification says the agency has expanded automated checks of bank accounts and payroll information in an effort to identify changes earlier.
The OIG made three recommendations, including that SSA act on the individual underpayments uncovered during the audit and determine how to identify and resolve the estimated 1.1 million outstanding payments owed to recipients or eligible survivors.
It also called on the agency to identify the causes of employee errors and introduce corrective measures so erroneous records are removed and required reviews of large underpayments are properly documented. The SSA agreed with all three recommendations.
The watchdog warned that failures to issue money already determined to be due can have serious consequences for people enrolled in a program specifically designed for Americans with very limited income and resources, saying recipients could experience "significant financial hardship" when underpayments are not resolved.
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