Is Elon Musk right about widespread Social Security fraud?
(NewsNation) — Elon Musk said he might have uncovered “the biggest fraud in history” when he found millions of people over age 100 listed in a Social Security database, but that’s not what’s going on.
On Sunday, Musk posted a chart on X allegedly showing more than 20 million people over 100 years old listed in “the Social Security database.”
“These are the numbers of people in each age bucket with the death field set to FALSE!,” Musk said, joking that “a lot of vampires” are collecting Social Security.
He added, “There are FAR more ‘eligible’ social security numbers than there are citizens,” and said it might be “the biggest fraud in history.”
While it’s true that there are only 90,000 people over 100 living in the U.S., that doesn’t mean millions of dead beneficiaries are receiving Social Security checks.
Records with incomplete death info are a well-known, long-standing challenge for the Social Security Administration, but a 2023 agency inspector general report found “almost none” of the 18.9 million people listed as 100 or older were receiving benefits.
“What Musk has tweeted is not primarily an example of fraud but more like the messy databases kept by Social Security,” said Alex Nowrasteh, the vice president for economic and social policy studies at the libertarian Cato Institute.
Nowrasteh said when someone turns 100, the government manually checks to make sure they are still alive and not receiving extra benefits. He pointed out that Social Security fraud is a “very small issue” compared to the program’s other challenges.
Martin O’Malley, the former Social Security commissioner under Joe Biden, laughed when asked about Musk’s fraud claims Monday.
“He doesn’t know what he’s talking about,” O’Malley told NewsNation’s Chris Cuomo.
Here’s what’s going on with Social Security’s death data and why it’s not necessarily an example of rampant fraud.
Are millions of dead people still receiving Social Security benefits?
A Social Security list known as the “Numident” — which is what Musk is believed to be referring to — shows far more centenarians than are actually alive, but that doesn’t mean they’re being sent checks.
The inspector general’s 2023 audit found that Social Security’s Numident included approximately 18.9 million people listed as 100 or older but not dead — far more than the 86,000 centenarians living in the U.S. at the time of the review.
However, “almost none” of the 18.9 million were receiving Social Security payments, the report concluded. Instead, only 44,000 people over 100 were getting benefits — closer to the actual centenarian population.
“This hardly feels like big potatoes,” economist Justin Wolfers wrote in response to Musk’s findings on X.
The inaccurate death information likely stems from the fact that individuals died decades before the use of electronic death reporting, according to the inspector general report.
Incomplete or inaccurate info can cause discrepancies across the various databases Social Security relies on, but it doesn’t mean there’s rampant fraud.
With that said, leaving the problem unsolved could allow “for a wider range of potential abuse,” the 2023 audit noted.
Correcting the errors would come at a cost, anywhere from $5.5 to $9.7 million, according to the Social Security Administration.
Does Social Security mistakenly pay people after they die?
While the scale of the overpayment problem is almost certainly smaller than Musk has implied, improperly paying dead beneficiaries does happen.
An inspector general report from Nov. 2021 found that Social Security issued approximately $298 million in payments after death to about 24,000 beneficiaries. The agency recovered about $84 million of that, meaning it had not recovered about $214 million of the payments.
That doesn’t mean fraud is the reason those payments went out. Instead, the report found that it was mostly because Social Security technicians did not follow policy.
A separate 2015 audit of Social Security found just 3 confirmed instances of employment fraud in a sample of 6.5 million deceased individuals.
O’Malley said the main fraud concern is when people call in and try to switch accounts, hijacking benefits from the living, not the dead.
“That’s where most of the fraud comes from,” O’Malley told Cuomo.
Meanwhile, the U.S. Treasury announced in January that it had recouped more than $31 million in federal payments that improperly went to dead people.
That result came as part of a five-month pilot program after Congress gave the Treasury temporary access to the Social Security Administration’s “Full Master Death File.”
“These results are just the tip of the iceberg,” the Treasury’s Fiscal Assistant Secretary David Lebryk said in a news release. “Congress granting permanent access to the Full Death Master File will significantly reduce fraud, improve program integrity, and better safeguard taxpayer dollars.”
The Treasury said it expects to recover over $215 million during the three-year access period, which runs from Dec. 2023 through 2026.
How big of a problem are overpayments?
The Social Security Administration issues over $1 trillion in benefit payments annually, which means even slight errors can cost taxpayers billions.
A July 2024 report from the agency’s inspector general called improper payments a “long-standing challenge” and said more needs to be done to fix the problem.
The audit found that the Social Security Administration sent about $71.8 billion in improper payments between fiscal years 2015 and 2022 — most of which were overpayments.
Still, the nearly $72 billion total represents 0.84% of the roughly $8.6 trillion paid out over the period.
While that is a lot of money, Social Security’s improper payment rate is considered relatively low compared to other large-scale programs.
“If you had to pick the places in the federal government where error rates are high, Social Security would be near the bottom of the list, not near the top,” said Charles Blahous, a senior research strategist at the Mercatus Center at George Mason University who specializes in Social Security.
By comparison, the Medicaid improper payment rate was over 5% in fiscal year 2024, according to the Centers for Medicare & Medicaid Services.
CMS noted that improper payments are typically related to administrative mistakes and don’t necessarily indicate fraud or abuse.
What’s the major problem with Social Security?
Social Security is facing a financial shortfall, and federal lawmakers are running out of time to fix it.
Without reform, the program’s trust fund could be depleted in roughly a decade. At that point, retirees could see their monthly benefits slashed by roughly 20% percent.
Cracking down on Social Security mistakes is a good thing, but it won’t necessarily solve the larger financial issue, Blahous pointed out.
“Social Security’s financial problems aren’t being caused by the improper payments but by legal ones exceeding what workers’ tax contributions can fund,” Blahous said.
Nowrasteh agreed.
“We definitely cannot lose sight of the fact that Social Security is facing very serious fiscal problems, and reductions in fraud are not going to make a meaningful difference,” he said.
