[Congressional Record Volume 146, Number 50 (Thursday, April 27, 2000)]
[Senate]
[Page S3024]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
By Mr. GRASSLEY (for himself and Mr. Breaux):
S. 2477. A bill to amend the Social Security Act to provide
additional safeguards for beneficiaries with representative payees
under the Old-Age, Survivors, and Disability Insurance program or the
Supplemental Security Income program; to the Committee on Finance.
SOCIAL SECURITY BENEFICIARIES PROTECTION ACT
Mr. GRASSLEY. Mr. President, I rise today to introduce legislation
which would make Social Security beneficiaries, who had their benefits
misused by organizational representative payees, whole. While most
people receive their Social Security and Supplemental Security Income
benefit payments directly, others must have assistance in money
management. Benefits, totaling over $25 billion, to these people are
paid through representative payees who receive and manage the payments
on behalf of the beneficiaries. Representative payee responsibilities
include, but are not limited to, frequently monitoring the
beneficiary's current well-being for food, shelter, clothing, medical
care, and personal needs; informing the Social Security Administration
of changes in the representative payee's own circumstances that would
affect the performance of representative payee services; reporting
events to the Social Security Administration that may affect the
beneficiary's entitlement or amount of benefits; and submitting an
annual accounting to SSA reporting about benefits received, used, and
conserved.
Currently, about 6.5 million Social Security and Supplemental
Security Income program beneficiaries rely on representative payees to
manage their monthly benefits. SSA usually looks for a payee among the
beneficiary's family and friends. For others, those traditional
networks of support are not available, and SSA relies on state, local,
or community sources to fill the need. Family members serve as
representative payees for about 88 percent of the beneficiaries
requiring them. 45,050 organizations, such as institutions, government
agencies, financial organizations, and qualified fee-for-service
organizations, serve as payees for the other 12 percent, totaling
750,570 beneficiaries.
As Chairman of the Special Committee on Aging, I am especially
concerned about the 795,060 beneficiaries, age 62 and over, who are
served by representative payees. With the retirement of the baby boomer
generation on the horizon, the number of institutions, such as nursing
homes, serving as payees stands to increase dramatically. Therefore,
addressing this matter now is all the more urgent.
The majority of representative payees provide much-needed help to
beneficiaries without abusing this responsibility. A minority of payees
misuse their position. SSA's Office of the Inspector General (OIG) has
recently investigated several instances of misuse by organizational
representative payees. One such investigation served as the subject of
a recent ``20/20'' television news program segment. In this segment,
several elderly Social Security beneficiaries accused Greg Gamble, of
the Aurora Foundation, a former organizational payee, of using their
benefits for his own purposes. On March 14, 2000, Mr. Gamble entered a
guilty plea in federal court of embezzlement of Social Security funds.
As part of the plea agreement, Mr. Gamble agreed to make restitution to
SSA in the amount of $303,314.00. Although this is only one example of
misuse, SSA's OIG has just begun investigating several instances of
misuse. Since FY 1998, it has identified about $8 million in SSA
representative payee fraud loss. SSA's OIG expects the number of misuse
cases to increase as SSA increases its review of organizational
representative payee records.
When any payee has been determined to have misused an individual's
benefits, SSA reassigns another payee to the beneficiary.
Unfortunately, SSA can reissue the benefits only in cases where
negligent failure on SSA's part to investigate or monitor the payee
resulted in the misuse. In virtually all other cases, the individual
loses his or her funds unless SSA can obtain restitution, through civil
processes, of the misused benefits from the payee. If SSA is able to
recover the misused amount, it may take years to do so. In the
meantime, the beneficiary has lost the amount misused and may be
temporarily inconvenienced, by not having money to pay rent, utilities,
or food, until a new payee is assigned.
In order to prevent misuse of benefits in the future, and to provide
better accountability of benefits to beneficiaries, I am introducing
the ``Social Security Beneficiaries Protection Act,'' along with my co-
sponsor and Special Committee on Aging Ranking Member Senator Breaux.
This bipartisan bill:
(1) gives SSA the authority to re-issue benefits misused by
organizational payees on its own determination (presently, benefits are
only re-issued when a court finds that SSA negligently failed to
investigate/monitor the payee);
(2) requires non-governmental organizational payees to be bonded and
licensed (presently, there is a bonding or licensing requirement);
(3) requires fee forfeiture when payees misuse benefits;
(4) gives SSA overpayment recovery authority for benefits misused by
non-governmental payees; and
(5) extends civil monetary penalty authority to SSA (of not more than
$5,000 per violation for misuse offenses).
I urge my fellow Senators to support Senator Breaux and me in
ensuring that our Nation's most vulnerable citizens, senior citizens
and the disabled, will receive every dollar of benefits to which they
are entitled.
I would also like to remind everyone that the Senate Special
Committee on Aging is holding a hearing on misuse of benefits by Social
Security organizational representative payees Tuesday, May 2, 2000, at
10:00 a.m. in 562 Dirksen.
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