November 4, 2013

A living wage for the dead? Costly flaws plague U.S. system

In the past few years, Social Security paid $133 million to beneficiaries who were deceased.

By David A. Fahrenthold
The Washington Post

WASHINGTON — The U.S. government has a problem with dead people. For one thing, it pays them way too much money.

In the past few years, Social Security paid $133 million to beneficiaries who were deceased. The federal employee retirement system paid more than $400 million to retirees who had passed away. And an aid program spent $3.9 million in federal money to pay heating and air-conditioning bills for more than 11,000 of the dead.

These mistakes are part of a surprising glitch at the heart of the federal bureaucracy. Because of a jury-rigged and outdated system meant to track deaths, the government has trouble determining exactly which Americans are deceased.

As a result, Washington is bedeviled by both the living dead and the dead living.

The first group are people who have died but are counted as alive in federal records. Their benefits keep coming. Millions of dollars pile up in unwatched accounts. Millions more are spent by feckless relatives. In one recent record-breaking case, a son stole his dead father’s federal benefits for 26 years.

The second group includes living Americans – at least 750 new people every month – whom the system falsely lists as dead. And once you’re on that list, it is not easy to get off. This summer in Utah, one man visited a Social Security office to protest his “death” in person. But the clerks wanted more evidence. They gave him a piece of paper, the man’s son recalled.

They asked him to write on it, “I’m alive.”

In Washington, these failures have become a long-running case study in how government systems break – and stay broken.

In this case, the causes include familiar bad habits, such as the inattention of Congress, and inertia in the bureaucracy. A job that the government needs done – compiling a full and accurate list of the nation’s dead – never really became anybody’s job.

“We come into the world with nothing. And we leave this world with nothing,” said Sen. Tom Carper, D-Del. Or at least, he said, that’s how it’s supposed to work. Now, Carper said, “as long as we have dead people getting benefits, there’s still a Hail Mary [chance] at trying to take it with you. And if you can’t take it with you, someone else is getting that money.”

COSTLY GLITCHES

The task of tracking deaths for the federal bureaucracy is an enormous one; about 2.5 million Americans die each year. Federal officials say the vast majority of these cases are handled correctly: The death is recorded. Government money is no longer sent to that person.

But not always. In fact, glitches in the system have paid more than $700 million to the dead, according to government audits performed since 2008.

The latest mistakes were revealed last week. In 2011 alone, auditors found, Medicare paid $23 million for services “provided” to dead people. From 2009 to 2011, it spent $8.2 million on medical equipment “prescribed” by doctors who had been dead for at least a year. The causes seemed to include poor record-keeping, sometimes exploited by fraudsters.

For government watchdogs, these are some of the most fixable – and therefore the most maddening – mistakes that the government makes. A big part of the frustration stems from the fact that there is no interest group fighting to keep the flawed status quo: The dead do not lobby.

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