2.5M People Already Received US Social Security Benefit Hikes Under New Law; 200,000 Cases Pending

The Social Security Administration (SSA) recently said that 2.5 million people have already received monthly benefit hikes or lump-sum retroactive payments under the Social Security Fairness Act, which was signed into law on 5th January.

The new law eliminated the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO) provisions, which previously reduced Social Security benefits for people receiving public pensions from work that didn't require payment of Social Security payroll taxes. The law is expected to benefit many teachers, firefighters, police officers, and federal employees covered by the Civil Service Retirement System.

Even Railroad Retirement Board beneficiaries could receive adjusted annuity payments as a result of the law. The new monthly annuity amounts many recipients would receive will begin reflecting from July payments, and one-time retroactive payments are due to arrive by the end of the next month, according to a board spokesperson.

Note that not everyone in these groups will see a benefit hike. For instance, over 70% of state and local public workers pay Social Security payroll taxes, and they won't be affected by the new law, according to the SSA.

The agency expected the new law to benefit almost 3 million people, meaning nearly 91% of cases have already been processed. Although the agency had earlier said beneficiaries might have to wait over a year to receive new payments, the utilisation of automation by the SSA is helping speed up the payment hikes.

How Much Increase in Monthly Benefits can People Expect?

According to the SSA, monthly benefit hikes could be as much as £736 ($1,000) for some recipients. The Congressional Budget Office had earlier estimated that changes in monthly payments could range between £265 ($360) and £876 ($1,190), depending on each case.

At present, the SSA is working to accurately update beneficiary records affected by the law by November and close the remaining 200,000 complex cases that couldn't be processed through automation.

When Will Complex Cases be Resolved?

The SSA indicated that complex cases will require manual information updates to process both retroactive and new monthly benefits. Some of these cases could involve recipients who may have passed away recently and are eligible for lump-sum retroactive payments. In these situations, the SSA would possibly attempt to make payments to survivors/legal heirs.

Even some newly eligible people, as a result of the law, might be subject to manual processing, and they might need to file a separate application.

Those with changes to monthly benefits or eligible to receive a retroactive payments will get a mailed notice from the agency detailing the benefit change or retroactive payment. Some of them might receive two notices in their mail.

'A beneficiary may receive two mailed notices, the first when WEP or GPO is removed from their record, and a second when their monthly benefit amount is adjusted for their new monthly payment amount. They may receive the retroactive payment before receiving the mailed notice,' the SSA stated.

'Commissioner Bisignano committed to senators during his confirmation process that this would be finished "while the weather is warm," and he will keep his promise,' according to an SSA official.