This is simply the result of big government in our lives. It's the bureaucratic mess that occurs when government is given too much power over our lives; when we let them have that much power over our lives. They decided, for her, that the money she was collecting was sufficient to live on... not that the decision made sense, it doesn't, but bureaucratic decisions tend not to make sense.
It will be worse when the government passes universal healthcare coverage. Under the current proposals, they will tell you whether you're insurance is sufficient, and if not, will fine you for not having the proper coverage. Eventually, as government continues it's reckless spending, more and more people will be told their coverage is insufficient as they try to cover the increasing debt. Then, you will decide to get the best coverage available so you won't be fined, and that will result in being taxed for having a "luxury" plan.