Sinn Fein's Mickey Brady told the Social Development Committee the company carrying out work capability assessments had found a number of terminally-ill people "fit for work", on 4 October 2012.
The committee was being briefed by Social Development Department (DSD) officials on the latest report into the capability assessment system carried out by Prof Malcolm Harrington.
Committee chairman Alex Maskey, also of Sinn Fein, expressed concerns that Prof Harrington had published a number of reports but had never visited Northern Ireland.
He said he found this unacceptable and "quite disturbing".
Brian Doherty of DSD said the professor had a heart condition that did not allow him to fly.
A number of committee members gave anecdotal evidence of what they saw as the injustice of the assessment process.
Mark Durkan of the SDLP said "the system as it currently stands is not fit for purpose".
The committee was also briefed by officials on the principles of the Welfare Reform Bill.
Anne McCleary of DSD outlined the main themes of the bill.
These were: sustainability, simplicity, targeting, personal responsibility, fairness and parity.
She said it was essentially an enabling bill that would allow policy to be worked out through regulations.
Ms McCleary said there would be a cap on benefits of £500 a week for couples and single parents and £300 for other claimants.
She listed a number of exceptions to the cap.
Earlier, the committee was briefed by the Northern Ireland Retail Consortium (NIRC) on the Business Improvement Districts Bill.
Business Improvement Districts (BIDs) provide additional or improved services as identified and requested by local businesses, such as extra safety, cleaning and environmental measures.
They are funded by additional levies paid by eligible businesses following a ballot.
Aodhan Connolly of NIRC said BIDs in England, Scotland, Wales and the Republic of Ireland "have made a huge positive impact" on business in town centres.
He noted that almost 1 in 4 shops in Northern Ireland was now lying vacant.
Mr Connolly gave some examples of successful BID schemes, including taxi marshals in Falkirk and extra security measures in Hull city centre.