Michigan working to stop disability fraud at the front door

By JOSH THALL
Capital News Service
Lansing — A new unit investigating disability fraud in Michigan projects that it has already saved taxpayers $700,000.
The Cooperative Disabilities Investigations Unit (CDI) is a joint organization of the Social Security Administration and the Michigan Department of Human Services formed last August. Michigan is one of 24 states that now has a branch of the organization since it was created nationally 17 years ago.
The Michigan branch has found 50 suspicious applications. Of those, 16 have been investigated further, 10 are still open and the six that have been denied that would have cost the taxpayer $700,000 over the next five years if they went unnoticed, said Bob Wheaton, acting manager of communications and public information officer for the Department of Human Services.

As of 2013, 8.3 percent of Michigan residents receive disability benefits either through Social Security or Supplemental Security Income or both, Wheaton said. That is above the national average of 6.4 percent.
Andrew Cannarsa, a press officer for the Office of the Inspector General, said the main focus of the agency is to investigate suspicious disability applications to find potential cases of fraud.
“If there is a suspicious or questionable disability claim, and an examiner needs or wants more information, these investigative teams can go that extra step to verify the applicant is legitimately disabled,” Cannarsa said. “It is a lot easier to stop the payment at the front end then it is to put someone on the rolls and have the fraud discovered after the fact.
“It makes it a lot easier to recover money that should not have been given out.”
Investigators identify a potential fraud based on a criteria set by the Social Security Administration. Or someone calls in a tip, Wheaton said.
The main type of fraud is when people claim they a back problem that impairs them from completing a job.
Cannarsa said one of the ways investigators find people exaggerating their claims is by trying to get evidence they are doing things they are claiming they are unable to do.
“Fraud is a big problem, it compromises the credibility of a program and costs the taxpayers money that they should not be paying,” said Nick Lyon, director of the Department of Community Health.
Nationally for the 2014 fiscal year, the CDI received 7,438 allegations of disability fraud, and finished investigations for another 4,126 cases where claims were denied or a beneficiary had their benefits terminated, Cannarsa said. The projected savings to taxpayers was $336 million.
Cannarsa said the the organization has been expanding and thought that Detroit was a good location for a CDI unit based on their selection criteria.
The organization has several steps that it takes when looking for a location to open a new unit that includes determining where there are enough allegations to sustain a unit, making sure that federal agencies are able to contribute adequate staff to the project and the most important thing is ensuring there is a local partner, Cannarsa said.
Wheaton said the  Department of Human Services had noticed the federal government attempting to expand the size of the DCI, and decided it would be a good way to address a concerning problem.
Cannarsa said the department has been a great partner for the Detroit unit.
“That’s just the best case scenario, when you have a willing and able partner that wants to lend investigators to this operation,” Cannarsa said. “The other thing is, while investigating social security disability fraud, there are also state welfare programs that these individuals might be receiving benefits from that they are not eligible for.
“So there can be returns to the state as well, it’s not just returns to the federal government.”