Have You Been Granted Social Security Benefits But Also Ordered To Designate A Payee Representative?
The Way I C It, you should appeal if you believe you have your head on straight and can back it up.
If you Disagree with Social Security Administration’s Decision:
You have the right to appeal either the decision that you need a representative payee, or the person or organization SSA has chosen as your representative payee. You have 60 days to appeal a decision by contacting SSA. Contact your local Social Security office
Remove
the representative payee from an account. If someone needs to be removed from a
bank account as representative payee because you can now manage your own money,
you must provide proof by visiting a Social Security office. If your mental or
physical capacity has improved you must take a letter from your doctor to the
Social Security Administration office to confirm this. Other proof can consist
of a court order. In addition to the letter, bring picture identification such
as a driver's license or state identification and your Social Security card.
Fill out the application provided by Social Security. You will be required to
fill out a brief application and the SSA must approve the change. If approved
go to your bank and open a new account. Your bank will need a letter from
Social Security which confirms you are now the representative payee. Provide
Social Security with the new bank account number and routing number. All future
deposits will go to the new account. The old representative payee will be
informed by mail. They will be required to turn over all remaining funds to
Social Security or you.
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CODE OF FEDERAL REGULATIONS
TITLE 1--GENERAL PROVISIONS
CHAPTER III--ADMINISTRATIVE CONFERENCE OF THE UNITED STATES
PART 305--RECOMMENDATIONS OF THE ADMINISTRATIVE CONFERENCE OF THE
UNITED STATES
1 C.F.R. s 305.91-3
s 305.91-3 The Social Security Representative Payee Program
(Recommendation No. 91-3).
As part of the Social Security program, Congress has authorized
the Social Security Administration (SSA) to pay certain beneficiaries' benefits
to other persons or organizations where the Secretary determines that payment
to such a "representative payee" would be in the interest of the
beneficiary. [FN1] SSA currently pays about $20 billion annually in social
security benefits to representative payees of more than 4 million (or about
10%) beneficiaries. Because the program has been the subject of some concern
and litigation, SSA asked the Administrative Conference of the United States to
study certain procedural aspects of the representative payee program. While the
study was underway, Congress addressed some of the procedural issues as part of
the Omnibus Budget Reconciliation Act of 1990 (OBRA), Public Law 101-508,
section 5015.
[FN1] The term "beneficiary" as used in this
recommendation refers to those receiving benefits under both title II (old age
survivors and disability benefits) and title XVI (supplemental security income
payments). Those receiving benefits under this latter program are technically
referred to as "recipients."
A. Rulemaking. The representative payee program operates under a
statute that for the most part paints program requirements with a broad brush.
SSA has some regulations, but many of the operating instructions are found in
the Program Operating Manual System (POMS), the agency's internal operating
manual. There are a number of issues the Conference believes should be the
subject of regulations, either because they are not adequately addressed
anywhere, or because they should be addressed in regulations rather than only
in the POMS. These issues are discussed below. This recommendation contains
specific suggestions for modifying the procedures for appointing representative
payees (see section B, below). For a number of other issues, involving the
establishment of program criteria, the Conference takes no position on the
content of the rules, but recommends that the issues be addressed in the
context of notice-and-comment rulemaking.
First, there currently exists no clear standard for when a
representative payee should be appointed in a particular case. The Social
Security Act provides that "(i)f the Secretary determines that the
interest of any individual under this title would be served thereby,
certification of payment of such individual's benefit under this title may be
made * * * (to a representative payee)." [FN2] The Act does not contain
any standard for determining when appointment of a representative payee is in
the beneficiary's interest. Current SSA regulations provide only that a
representative payee will be appointed when "due to a mental or physical
condition or due to * * * youth," a beneficiary is "not able to
manage or direct the management of" his or her own benefits. [FN3] The
regulations neither indicate what constitutes an inability to manage benefits,
nor what mental or physical condition must be found. This lack of a standard
requires SSA personnel to make largely discretionary decisions that are
difficult to challenge individually or to evaluate programmatically.
[FN2] 42 U.S.C. 405(j)(1) (Title II). For title XVI, the
provisions are comparable. See 42 U.S.C. 1383(a)(2)(A).
[FN3] 20 CFR 404.2001, 416.601 (1990).
While the Administrative Conference takes no position on what the
substance of a standard for representative payee appointment should be, it
believes that the promulgation of a more detailed standard through rulemaking
is important to promote the appearance and reality of fairness and consistency
in operation of the representative payee program. [FN4]
[FN4] Among the issues that might be addressed are how the
specific standard should balance interests in beneficiary autonomy versus
government beneficence, what factors should be considered in determining
whether a beneficiary's interest would be served by appointing a payee, what
should constitute inability to manage benefits, and who should be the
decisionmaker (e.g., the states in guardianship proceedings, the state
disability determination services, or trained agency lay or medical staff). Any
rule setting a standard for appointing a representative payee should also
address the question of what types of evidence are either appropriate or
necessary in making the determination.
SSA should also itself carefully consider the education levels and
other qualifications of agency officials making determinations on
representative payee status, to ensure that such decisionmakers have the
necessary skills to apply whatever standard is developed.
Second, concerns have been raised that persons interested in
gaining access to beneficiary funds may provoke SSA action to appoint a
representative payee without sufficient factual basis. Thus, a standard should
be developed for a minimum amount of evidence necessary to trigger the
initiation of procedures that could result in the appointment of a
representative payee.
Third, the Conference recommends that SSA promulgate clarifying
rules relating to eligibility to serve as a representative payee, including a
method for determining priorities where there are competing applicants for such
payee status. Although SSA has some internal guidelines for selecting
appropriate representative payees, the Conference believes that such issues
should be addressed in regulations, to provide public participation in their
development and to provide easier access to their contents.
Finally, the question of SSA's responsibility to monitor
representative payee performance has been a subject of concern. Although a
court has ruled that the Constitution's due process clause requires annual
accounting by all representative payees, [FN5] the decision's continued
applicability is not clear. [FN6] The Social Security Act currently requires
annual accounting by representative payees, except certain institutions. [FN7]
Congress in the OBRA amendments expressly required SSA to study more stringent
monitoring of "high risk" payees (e.g., representative payees who are
not related to the beneficiary or who are creditors). SSA should undertake
rulemaking to promulgate procedures for monitoring representative payee
performance in a manner that will be both effective and efficient. [FN8]
[FN5] Jordan v. Schweiker, 744 F.2d 1397 (10th Cir.1984); Jordan
v. Bowen, 808 F.2d 733 (10th Cir.1987).
[FN6] The Jordan case was a class action, certified in 1980. The
court held that the Constitution required annual accounting for all payees. The
impact of time on the class, as well as the impact of subsequent legislation,
raises some questions concerning the case's current applicability.
[FN7] 42 U.S.C. 405(j)(3).
[FN8] Such a rulemaking could address such issues as what type of
information is needed to make decisions, how often it should be reported or
collected, whether different requirements should apply to different types of
payees, and what SSA will do with the information it obtains in terms of its
internal use and public availability.
B. Procedures--1. Current procedures. When SSA receives
information that a particular beneficiary may need a representative payee, it
seeks to gather evidence with which to determine whether the beneficiary is
incapable of managing his or her own benefits. [FN9] If SSA decides that the
beneficiary is incapable, its first step is to select a representative payee.
SSA then sends what is called an "advance notice" to the beneficiary,
informing the beneficiary that he or she has been found incapable of managing
benefits and that SSA intends to appoint the named representative payee. The
beneficiary is allowed 10 days to respond to SSA and provide additional facts.
This is often the first notice that the beneficiary receives that appointment
of a representative payee is being contemplated. If, after receiving any
further information, SSA confirms its decision, it sends the beneficiary notice
of its "initial decision," which is implemented immediately. The
beneficiary may seek "reconsideration" from SSA, following which the
beneficiary is entitled to a hearing before an administrative law judge and
appeal to the Appeals Council.
[FN9] Such evidence may include state adjudications of
incompetence, a physician's opinion that a beneficiary is unable to manage
benefits, or lay evidence to that effect.
Under these current procedures, the beneficiary generally is
provided no notice that SSA is considering appointing a representative payee
until the agency has already preliminary decided that one is necessary and has
selected a candidate. The "advance notice" does not explain the basis
for the decision to appoint a representative payee. Nor is the beneficiary
given an opportunity to meet with SSA face-to-face before a representative
payee decision is implemented. While the present procedures appear to satisfy
constitutional minima, considerations of efficiency, fairness and appearance of
fairness suggest certain modifications to these procedures.
2. Conference recommendations. The Conference recommends several
changes in the process, that, consistent with its other recommendations
involving the Social Security program, encourage increased procedural
safeguards at the beginning of the process in order to maximize correct
decisions in the early stages and lessen the need for additional proceedings.
[FN10] The Conference recommends that SSA notify a beneficiary as soon as the
threshold for initiating action, discussed above, is met, offering the
beneficiary an opportunity to have an informal face-to-face interview with an
SSA claims representative. To the extent practicable, the notice (and all other
notices) should be designed to be understandable to the beneficiary, taking
into consideration information already in the file (e.g., what language the
beneficiary understands). [FN11] The notice should also inform the beneficiary
that appointment of a representative payee is being considered, describe the
standard for and basic reason(s) why it is being considered, ask for all
relevant information concerning the need for and selection of a representative
payee, and ask the beneficiary to suggest a possible candidate. SSA should also
notify the beneficiary of any person(s) it knows to be under consideration as a
representative payee.
[FN10] See, e.g., Recommendation No. 90-4, "The Social
Security Disability Program Appeals Process: Supplementary Recommendation,"
1 CFR 305.90-4.
[FN11] The expectation is that there would be several form notices
with the clearest practicable wording in different languages, normal and large
type sizes, and perhaps braille.
If, after completing its investigation, SSA decides to appoint a
representative payee, it should notify the beneficiary of this determination,
informing him or her of the right to review the evidence and appeal. [FN12] The
determination then would be implemented, after which appeal to an ALJ and the Appeals
Council would be available, as it is now. These procedures would eliminate the
current opportunity for "reconsideration" that is provided after
implementation but before the ALJ hearing.
[FN12] OBRA amendments require such notice. See 42 U.S.C. 405(j)(2)(E);
1631(a)(2)(B)(x)-(xii).
The rationale for these recommended procedures is that a
beneficiary should have notice and the opportunity to respond concerning his or
her alleged inability to manage benefits before the SSA has made a de facto
determination that a representative payee is required and who that payee should
be. The ability to manage benefits is not always strictly a medical
determination; it may well involve consideration of observed behavior. Thus, it
is likely that a decisionmaker who has had an opportunity to see and talk with
the beneficiary will often make a more accurate determination of the need for a
representative payee. [FN13] The Conference believes that, as in the disability
adjudication itself, procedures that encourage as complete a record as early in
the process as possible offer significant advantages that far outweigh any
short-term costs occasioned by adding an earlier notice and opportunity for a
face-to-face meeting. Not only will early notice to beneficiaries and an opportunity
for personal contact with SSA allow beneficiaries to provide any relevant
information that they have at a predecisional level, it may also give them more
confidence in the process, thus resulting in fewer appeals at later stages.
Moreover, as noted above, the opportunity for "reconsideration" that
is currently provided after implementation but before the ALJ hearing would no
longer be required.
[FN13] The Administrative Conference has recommended that
face-to-face meetings be available in the context of medical disability
determinations. Recommendation 89-10, "Improved Use of Medical Personnel
in Social Security Disability Determinations," 1 CFR 305.89-10.
Under current procedures, beneficiaries are permitted to have
assistance, by attorneys or non-attorneys, in disputes over representative
payee status. However, because of the lack of formal procedures until late in
the process and, more important, the lack of an "award" out of which
to pay attorneys, there has been little attorney or lay assistance involvement
in this program. It would thus be especially useful for SSA to develop and
provide beneficiaries with information about legal assistance and other
relevant organizations that may be available in their areas. [FN14]
[FN14] The Conference has encouraged the use of nonlawyers in
agency proceedings. See Recommendation 86-1, "Nonlawyer Assistance and
Representation," 1 CFR 305.86-1.
In situations where someone applies to replace a representative
payee, both the payee and the beneficiary should be given notice of the
possible replacement. Both should be given an opportunity to file comments and
to meet informally with SSA officials. If the representative payee is replaced,
the beneficiary (but not the payee) should have the right to appeal the
determination.
Although a beneficiary in representative payee status may apply to
have such status terminated, no procedure currently exists for reexamining the
need for a representative payee on any periodic basis. Because there are
certain types of beneficiaries for whom a representative payee is less likely
to be needed permanently (e.g., stroke victims, persons with reactive
depression), it is in the interests of both the agency and beneficiaries to
reassess periodically the need for representative payees for such individuals.
Thus, the Conference recommends that SSA attempt to determine which, if any,
types of beneficiaries in representative payee status ought to have their
status periodically reevaluated and provide a method for doing so.
C. Misuse of funds and restitution--1. Current practice.
Currently, determinations by SSA that beneficiary funds have been misused are
not appealable. This means that neither the beneficiary nor the representative
payee may challenge such determinations. Moreover, SSA does not currently have
an effective mechanism for requiring payees who misuse beneficiary funds to
return such funds to beneficiaries. [FN15] SSA currently has only the options
of referring cases to the Department of Justice for criminal prosecution or
requesting the representative payee to return funds. Most cases are too small
to warrant Justice Department action, and SSA has no authority to force a
representative payee to pay restitution.
[FN15] In cases where SSA has been negligent in investigating or
monitoring representative payees, SSA must make restitution to the beneficiary.
OBRA 5105(c).
2. Conference recommendations. Beneficiaries should be permitted
to appeal an administrative determination that their benefits have not been
used properly. [FN16] Representative payees should also be permitted to appeal
misuse determinations. Although they have no right to payee status, a
determination that they have misused funds will be entered into a data bank,
will prevent them from being appointed as a representative payee in the future,
and may have other negative ramifications. These consequences suggest that more
process may be due. ACUS recommends that a determination of whether
representative payee misuse of beneficiary funds has occurred be considered an
"initial determination," which triggers the right to reconsideration
and, if necessary, a subsequent ALJ hearing.
[FN16] Beneficiaries do have the right to use state court
remedies.
The Administrative Conference also recommends that Congress
authorize an administrative remedy that would allow SSA to (1) require
representative payees who have misused beneficiary funds to pay restitution,
and (2) impose civil monetary penalties on such payees. Such authority would
enable SSA to address the problem without burdening the courts. [FN17]
[FN17] See Recommendation 72-6, "Civil Money Penalties as a
Sanction," 1 CFR 305.72-6; Recommendation 79-3, "Agency Assessment
and Mitigation of Civil Money Penalties," 1 CFR 305.79-3. The Program
Fraud Civil Remedies Act, 31 U.S.C. 3801, authorizes the imposition of
administrative civil penalties for false claims against the government and for
certain types of false statements. However, it is not clear whether this Act
would apply to representative payee actions, and in any event, it does not
provide a remedy of restitution.
The OBRA amendments made clear that, where SSA's negligent failure
to investigate or monitor a representative payee results in misuse of benefits,
SSA must make restitution to the beneficiary for any such benefits, and then
may seek repayment from the payee. [FN18] The negative impact on a beneficiary
caused by misuse of his or her benefits, however, is independent of whether any
SSA negligence was involved. Congress should authorize research on the scope,
causes and effects of representative payee misuse of benefits, and methods to
ease the resulting burden on beneficiaries, including the use of loss
underwriting arrangements.
[FN18] OBRA 5105(c)(1), to be codified at 42 U.S.C. 405(j)(5).
D. Other issues. When this study was undertaken, the issue of
SSA's need to investigate representative payees before their appointment was of
major concern. The recent OBRA amendments, however, require SSA to undertake
certain investigations of potential representative payees. For the present,
those steps would appear to be adequate, but, after sufficient time has passed,
their effectiveness should be reevaluated.
In the past, where SSA has determined that a representative payee
is required, but has not found a suitable candidate, SSA has suspended benefit
payments until a payee could be found, at which time the withheld payments
would be released to that payee. In the OBRA amendments, Congress authorized
SSA to suspend payments for no more than 30 days, where direct payment would
substantially harm the beneficiary. However, where the beneficiary is legally
incompetent, under the age of 15, or a drug addict or alcoholic, there is no
time limit on the suspension of benefits. The Conference believes that SSA
should study the impacts of the indefinite suspension of benefits on
beneficiaries in these groups, with the objective of making legislative
recommendations to Congress if the study suggests that time limits should exist
for all classes of beneficiaries or that suspension should not permitted at
all.
In many cases, finding an appropriate representative payee is a
significant problem. SSA should take steps to ease its burden by widening the
pool of potential representative payees, and by periodically seeking input from
beneficiaries. It would be useful for SSA to ask beneficiaries, at the time
that they apply for benefits and periodically thereafter, to designate a person
whom, at that time, they would prefer to serve as a representative payee, should
one become necessary. While such a designation would not bind the agency, in
many cases, the designation of someone whom the beneficiary thought was
appropriate could make the selection process easier for SSA and make the
beneficiary more comfortable with the representative payee. SSA also should
develop lists of national, regional and local organizations that could serve as
representative payees on a volunteer basis, and evaluate carefully the
performance of these and compensated or reimbursed representative payees.
[FN19]
[FN19] Congress has authorized the use of reimbursed
representative payees on a very limited basis. OBRA of 1990, Pub.L. 101-508,
sec. 5105(a)(3).
