Quantifying the Work-Related Overpayments of Social Security Disability Insurance Beneficiaries

We use an algorithm to produce statistics on the prevalence, duration, and amount of work-related overpayments accrued to Social Security Disability Insurance (DI) beneficiaries based on Social Security Administration administrative data for January 2010 through December 2012. We find that 1.9 percent of DI beneficiaries in our sample were overpaid due to work in one or more months during this three-year period. Although overpayments were rare among all DI beneficiaries, among those with sufficient earnings to put them at risk of a work-related overpayment, 71 percent were overpaid. Work-related overpayments lasted for a median of nine months and accrued to a median of $9,282 after adjustments to include all months in overpayment spells that are only partially within the three-year observation window. In addition, several beneficiary and program-related characteristics were associated with a higher likelihood of overpayment, suggesting that targeted or modified SSA outreach and communication may help beneficiaries comply with SSA processes and avoid overpayments.