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Social Security Commissioner Martin O'Malley agrees SSI program is outdated

AILSA CHANG, HOST:

We told you recently about a government program created to lift the poorest, disabled and elderly people out of poverty. But its rules are so out of date and so complex that people often get kicked off. Then sometimes they're surprised to find that they owe money back to the government, maybe tens of thousands of dollars, money that they don't have because they're some of the poorest people in America. Now, the head of the agency that runs that program responds. NPR investigative correspondent Joseph Shapiro reports.

JOSEPH SHAPIRO, BYLINE: Supplemental Security Income, or SSI, sends a cash payment every month, on average $700 to disabled and elderly people with little income. Some 7.5 million recipients use those checks to help pay for everyday expenses - food, rent, healthcare. The program is run by Social Security. Martin O'Malley, commissioner of the Social Security Administration, agrees SSI needs fixing.

MARTIN O'MALLEY: The program should be simplified. Congress needs to do an overhaul of this program.

SHAPIRO: Like the rule that causes the most problems - SSI's asset limit. To qualify for SSI, you can't have more than $2,000 in savings or assets. That limit hasn't changed since 1989.

O'MALLEY: And here's the problem with that limit being set in 1989 dollars is that it creates a very, very low trip wire for people who are on the program in terms of any other assets that they might have.

SHAPIRO: Cash, bank accounts, retirement savings, a second car - all get counted. And if a recipient lives with a spouse or parents, their resources matter too. It's easy to hit that trip wire, to go over the asset limit and lose SSI. Karen Williams of Philadelphia thought she was doing the responsible thing when she bought life insurance to pay for her funeral. But SSI counted it as an asset, then stopped her SSI checks and sent her a bill for $20,000 to pay back years of benefits.

KAREN WILLIAMS: I would have definitely went by the rules. I didn't know I was breaking them.

SHAPIRO: A bipartisan bill in Congress would raise the asset limit from $2,000 to 10,000. That's close to what it'd be if it had kept up with inflation over 50 years. O'Malley supports the fix.

O'MALLEY: Legislation that would raise that limit and eliminate the penalty that's currently in place for married couples.

SHAPIRO: That's another issue that came up in the NPR investigation. The asset limit is so low for couples - just $3,000 - that many people on SSI told us they don't get married or they marry and hide it. Some need SSI to get healthcare. In most states, SSI makes you automatically eligible for government health insurance. Amber Weise has spinal muscular atrophy. When she married, she lost her SSI and the medical care that kept her healthy.

AMBER WEISE: Nobody should be punished for getting married.

O'MALLEY: Well, it's hard to disagree with that. This is a program that has existed for 50 years. And like our other programs, we have a duty to constantly update and fix it whenever we see that there's an injustice being done, in this case a marriage penalty.

SHAPIRO: These are things that are written into law. It's up to Congress to fix. But there are things O'Malley and Social Security can do, like those ominous overpayment notices.

O'MALLEY: The notices that we send out, I have described them as Mad Libs written by mad lawyers that confuse, they scare, and most people have a difficult time understanding what many of these notices even say.

SHAPIRO: O'Malley moved recently to make it easier for people to challenge overpayment notices. He said the agency is committed to making other changes, like letting people apply for SSI online with a simplified application form, not the current one dozens of pages long. Reform can help people who rely on SSI and SSI staff too. O'Malley notes of all the checks Social Security sends out, SSI is just 4%. But it takes up 38% of Social Security's administrative overhead because SSI's rules are so complex and time consuming to follow for SSI's recipients and for staff too. Joseph Shapiro, NPR News. Transcript provided by NPR, Copyright NPR.

NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.

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Joseph Shapiro is a NPR News Investigations correspondent.