Seniors, advocates uneasy about Social Security switch
By Craig Smith
Published: Monday, Feb. 25, 2013, 12:01 a.m.
A years-long public education campaign hasn't eased the dread among some seniors about Friday's deadline for Social Security checks to go paperless.
The Treasury Department issues more than 165,000 paper checks among the 3 million Social Security and Supplemental Security Income payments made in Pennsylvania each month, records show. The department estimates the switch to electronic payments will save more than $1.9 million a year in the state and $1 billion nationwide in the next 10 years.
Social Security will pay benefits electronically through direct deposit into bank or credit union accounts, or credit a debit-like card called Direct Express Debit MasterCard.
Advocates for seniors are concerned about people who don't have bank accounts or who haven't gotten the word.
“I think this is going to be a train wreck,” said Debbie McCarthy-Arnone, president of Mars Chapter 3359 of the AARP.
Nationwide, about 4.25 million Social Security and SSI recipients go to their mailboxes each month for checks. Fayette, Allegheny and Westmoreland counties landed among the 10 top Pennsylvania counties for people receiving paper checks.
Seniors “remember when the banks failed. ... They went hungry,” said William Donnelly, 78, of West Mifflin, second vice president of Clairton Area Chapter No. 1612 of AARP, who gets his Social Security benefits through direct deposit. “You can't blame them.”
The Treasury sent notices with monthly checks about payments going paperless, but it took a letter in a newspaper advice column to reach one group of seniors.
Until that happened, “we hadn't heard anything,” said McCarthy-Arnone, who at age 56 doesn't yet receive Social Security benefits but receives SSI electronically for a disability.
She said many members of the AARP chapter don't have bank accounts or computers.
“These are people who have always just taken their check to the bank downtown, where everybody knows everybody,” McCarthy-Arnone, said. “Some are well over 90.”
Few to be exempt
The Treasury has little wiggle room in its rule.
A small portion of people will continue to receive paper checks — those born before May 1, 1921, the mentally impaired and those living in remote geographic areas. The Treasury will grant hardship waivers to people 90 and older who don't have direct deposit.
However, waivers will be “extreme, rare circumstances,” the department says.
If people without waivers don't switch, “they'll be hearing from Treasury in a more personal way,” said Walt Henderson, the Treasury official responsible for implementing the paperless initiative.
“Treasury will be in touch with them to inform them about their options for complying with the law,” he said. “No one's payment will be interrupted. They will still get a paper check.”
A computer is not required to receive benefit payments by direct deposit or the Direct Express card, Henderson said.
Data from the Treasury Department show 94 percent of federal benefits are paid electronically.
AARP in Pennsylvania supports the switch to increase efficiency, reduce fraud and abuse, and save money, spokesman Steve Gardner said.
The Treasury Department and the Federal Reserve Bank began an education campaign in 2005 to urge seniors and others to switch to direct deposit. Treasury ramped up the effort two years ago to end paper checks.
The Area Agency on Aging serving Cameron, Elk and McKean counties conducted an extensive blitz through its newsletter and 13 senior centers to spread the word about the switch, executive director Bill Orzechowski said.
“The word is out there; will they listen?” said Orzechowski, who concedes the campaign might not have reached every senior in rural counties.
Craig Smith is a staff writer for Trib Total Media. He can be reached at 412-380-5646 or firstname.lastname@example.org.
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