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Are federal and state officials sending mixed messages about federal disability fraud?

The federal government spends a staggering amount of money on the federal disability program.  Critics contend that much of the money spent is being wasted, and that more should be done to combat this wasteful spending.  To that end President Obama has pledged $4.3 billion over 5 years to fight disability fraud.

Administration officials contend that the skyrocketing cost of federal disability – up 65% from 2001 to 2007 – is the result of fraud.  Fraud stemming from a lack of oversight.  So the question is, will this fraud-busting $4.3 billion really make a difference?

Some argue that the increase in benefit recipients over the last few decades is the result of a loosening in disability requirements.  These days more people – especially children and the mentally ill – qualify for federal benefits than in the past.  So the increase in cost can’t be blamed on fraud alone.

In addition, some of the moves taken by states as a result of the economic recession will make it harder to ferret out cases of fraud.  Because of budget cuts, many states have laid off claims examiners.  This means that not only will the claims backlog increase, but the number of reviews of existing cases that can be done will drop.

Nobody wants a federal disability system riddled with fraud, but the government seems to be sending mixed messages.  How can they make noise about combating fraud while at the same time backlogs are growing as claims examiners are shown the door because of ever shrinking states budgets?