A Project of The Annenberg Public Policy Center

Stimulating the Dead


Q: Were stimulus payments made to dead people and prison inmates?

A: Yes, 89,000 of them, according to an official audit. About half of the $22 million was returned. The audit blamed both Congress and the Social Security Administration.

FULL QUESTION

Today, I learned that 17,000 prison inmates and a large number of dead people received $250 stimulus checks in the mail from the Obama administration. Is this fact true? If so, why did this happen?

FULL ANSWER

We’ve had several queries about this since a brief item appeared in the Wall Street Journal‘s Washington Wire column on Oct. 7. The Journal said:

Wall Street Journal: The Social Security Administration sent about 89,000 stimulus payments of $250 each to dead and incarcerated people — but almost half of them were returned, a new inspector-general’s report has found.

For more details, we consulted the I.G.’s report itself, which was issued Sept. 24. The audit looked at about $13 billion in payments made to 52 million persons under the stimulus legislation. Generally, persons who were receiving either Social Security benefits or Supplemental Security Income benefits were eligible for a one-time payment of $250, called an "Economic Recovery Payment" or ERP.

The I.G. said that the "vast majority" of the 52 million payments were issued properly. But there were exceptions. The I.G.’s audit estimated:

  • 71,688 recipients were deceased before the payment certification date, and received $18 million.
  • 17,348 recipients were incarcerated and received $4.3 million.

Making matters worse, the IG estimated that more than 8,000 of the payments to the dead were to persons with whom the Social Security Administration had not had any contact for more than 30 years, and who would have been between 112 and 136 years old had they been alive.

How Did This Happen?

Regarding payments to the dead, the audit found that in many cases the recipients had died recently but their deaths had not yet been reported to the Social Security Administration. But in other cases, officials simply failed to check their database of recent death reports before certifying the $250 payments. Social Security had also failed to purge its records of thousands of deceased "Prouty" beneficiaries — aged persons whom Congress made eligible for special benefits in 1966, and whose later deaths had never been reported.

The I.G. estimated that about 90 percent of the payments to prisoners was actually legal under the stimulus bill, because Congress neglected to make inmates ineligible for the payments, unless they were locked up during November or December 2009 or January 2010. But payments were certified in March, and recently incarcerated persons were thus eligible.

Over half the payments to dead persons has been returned, the I.G. said. However, Congress neglected to give the Social Security Administration authority to reclaim payments made in error to deceased persons.

The I.G. recommended that Social Security clean up its records of deceased "Prouty" beneficiaries. It also urged — if Congress ever issues ERP payments again — that officials should take greater care to check records of recent deaths, that anyone incarcerated at the time of payment should be made ineligible, and that Congress should provide authority for reclaiming mistaken payments.

Responding to the report, the Social Security Administration said it was "pleased" with the finding that the "vast majority" of payments had been made properly. Citing the "short timeframe" imposed by the stimulus legislation (it was signed on Feb. 17, 2009, and payments went out in May), the SSA noted that "we issued economic recovery payments (ERP) accurately to more than 99.8 percent of approximately 52 million eligible Social Security and Supplemental Security Income beneficiaries."

–Brooks Jackson

Sources

Radnofsky, Louise "Stimulus Checks Sent to the Dead" The Wall Street Journal. 7 Oct 2010.

O’Carroll, Jr., Patrick P. "Economic Recovery Payments for Social Security and Supplemental Security Income Beneficiaries." Social Security Administration, Office of the Inspector General. Audit Report A-09-10-11017. 24 Sep 2010.