Social Security Organizational Representative Payee 447-10-20-20-20

(Revised 7/1/2024 ML #3841)

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Definitions:

Social Security Administration (SSA): is an independent Federal government agency that administers two major benefit programs.

 

SSA or RSDI Benefits – Retirement, Survivors and Disability Insurance: Benefits paid by SSA under Title II of the Social Security Act. These are commonly called social security (SSA) benefits. They are based on the earnings of a worker who has paid into the system by paying Federal Insurance Contributions Act (FICA) tax for a specified period of time. A worker, or his or her family, can receive RSDI benefits upon the worker’s attainment of a certain retirement age, disability, or death.

 

SSI Benefits – Supplemental Security Income: Benefits paid by SSA under Title XVI of the Social Security Act for aged, blind, and disabled persons with little or no income or resources.

 

Representative Payee – an individual or organization appointed by SSA to receive and manage the social security or SSI benefits of another person. A representative payee must use the funds they manage for the exclusive use and benefit, and in the best interest of the beneficiary.

 

Representative Payees are categorized into two broad groups:

 

Please refer to the Social Security Administration website for a complete description of Representative Payee responsibilities.

 

SSI Benefits – Supplemental Security Income

SSI dollars are meant to meet the daily living and medical expenses for a child. These dollars are not meant to be banked. Federal dollars are used to fund SSI benefits and as a result, child in foster care eligible under Title IV-E or Emergency Assistance (EA) are eligible for reimbursement of their care with SSI or foster care funds through Title IV-E or EA but are not eligible to receive both. In any month a child is in receipt of SSI dollars, foster care is payable through regular foster care funds.

 

Social Security Administration allows a maximum asset limit is $2000 for SSI recipients. The amount retained in the following month in a savings or checking account cannot exceed $2000. A minimum of $30 should be retained from every check and given to the child for personal use. If the child is older and has additional expenses or a specific item they wish to purchase, SS money can be allocated for that purchase.

 

SSA Benefits – Retirement, Survivors and Disability Insurance

SSA benefits are considered unearned income for the child. Social Security does not have a maximum asset limit for SSA recipients, but Title IV-E foster care does. The maximum asset limit for a foster care child is $10,000 under foster care guidelines. Once the asset maximum is reached, the case is no longer reimbursable under Title IVE and general funds must be used to reimburse foster care expenditures. The custodial agency must “spend down” any excess amount over $10,000 for the case to again be Title IV-E reimbursable.

 

REACHING ALLOWABLE ASSET MAXIMUMS

The amount of SSI or SSA retained in a checking or savings account should be monitored closely to ensure the case does not exceed the allowable asset maximum. A case in which the maximum is reached is not reimbursable under Title IV-E. The amount received over the allowable maximum must be used in the month it is received towards the child’s expenditures. Foster care payments will continue to be disbursed monthly through the payment system.

 

For all children, regardless of their eligibility determination, in receipt of SSI benefits and that reach the allowable $2000 maximum, the overage must be returned to Social Security Administration with an explanation as to why the benefits are being returned. This will prompt Social Security to reevaluate the monthly benefit and it may result in a reduction due to the child’s needs being met under another federally funded program.

 

For a Title IV-E child in receipt of SSA benefits that reaches the $10,000 maximum under foster care guidelines,the asset limit must be monitored monthly. To maintain Title IV-E reimbursement, the asset limit must be under $10,000. The custodial agency must work with the child to spend down the asset amount. The child is not reimbursable under Title IV-E until the asset is within the allowable maximum. A match symbol adjustment from FM to FN is required for any month in which the case exceeds the allowable maximum. For children under tribal custody, the foster care expenditures will become the responsibility of the Tribal Nation until the asset is spent down to within the allowable maximum.

 

SSI VERSUS TITLE IV-E OR EA FUNDING SOURCE

When a child is eligible for both SSI and Title IV-E or EA funding, the custodial agency and the FCSA Eligibility Unit must determine, based on the best interest of the child, which federal funding source to elect for the foster care income maintenance costs. Federal guidelines prohibit an agency from claiming reimbursement from two federally funded programs for the same eligible case.

 

The custodial agency is responsible for notifying Social Security Administration of the child’s placement, the amount expended for the child’s care and which funding source will be used. An agency cannot claim both SSI and Title IV-E or EA.

 

Consider the following when determining which funding source to use. The agency should consider the fiscal interest of the state in electing IV-E or EA funding in lieu of SSI payments as well as the child’s cost of care. As a rule of thumb, whenever the cost of care is double the child’s monthly SSI payment, it will always be in the State’s fiscal interest to offset SSI and claim IV-E or EA funding. (In 1999, the IV-E income maintenance federal share is about 70%, so it is currently in the state’s fiscal interest to claim IV-E whenever the cost of care equals more than 170% of the SSI payment.)

 

EXAMPLE 1: A disabled child in residential care receives monthly SSI of $552. The cost of care for this child is $1500 per month, which the state partially offsets with the $552 SSI received as ORP. It is in the fiscal interest of the state to offset the SSI and claim IV-E income maintenance instead, which will bring $1500 x 70% = $1050 per month federal to the state – twice as much as the $552 SSI.

 

EXAMPLE 2: A disabled child in foster care receives monthly SSI of $552. The child’s therapeutic foster care costs the state $600 per month. It is in the state’s interest to retain the $552 SSI, since IV-E would bring less:  $600 x 70% = $420.

 

EXAMPLE 3: A disabled child in foster care receives monthly SSI of $552.00. The child’s family foster care cost is $357.74 per month. The cost of care is less than the SSI benefit. Therefore, the SSI benefit would not be suspended and foster care would be paid out of general funds. If it is in the best interest of the child, the agency would need to apply to become the payee for the SSI and each month submit the care cost of $357.74 to the state. The remaining balance of $194.26 would then be put into an established savings account for the child. In this same instance, $100.00 child care costs are also being paid for as an irregular expense. $100.00 would be sent into the state for reimbursement of this expense and the remaining balance of $94.26 would be deposited into the child’s bank account.

 

Even when the federal claim is only marginally above the SSI amount, the IV-E or EA election may be wise. Placements of disabled children are more frequently longer-term than others, and the cumulative state costs of making the “wrong” IV-E or EA versus SSI election can be enormous over time.  Given the potential fiscal consequences, agency staff should seek supervisory or state office guidance where judgments on this election seem particularly difficult.

 

NOTE: Regardless of whether SSI or IV-E is claimed for the foster care cost, IV-E administration can be claimed for this case. This is accomplished by counting such a case either as a IV-E reimbursable case (FM), or as one which is IV-E eligible but not IV-E reimbursable (FN) for the months in which SSI is claimed.

 

MATCH SYMBOL FM/FN OR EA/RM

The payment authorization match symbol identifies the funding source of payments for Title IV-E and Emergency Assistance (EA) eligible children. Title IV-E and EA are both federally funded programs. Based on the child’s eligibility determination, all payments in the month in which a child does not receive SSI benefits (payment suspended or becomes ineligible) are coded with a match symbol of FM (Title IV-E) or EA (Emergency Assistance).

 

Federal guidelines prohibit a state to claim federal dollars from two federally funded programs for the same individual’s care. Therefore, the match symbol for all payments in the month in which a child receives SSI benefits must be changed from FM to FN (Title IV-E non-reimbursable) or EA to RM (Regular Match-state general funds) depending on the eligibility determination of the child.

 

MATCH SYMBOL NA

A match symbol of NA is used in the foster care payment authorization to identify funds expended for a child under Tribal custody that is Title IV-E eligible and reimbursable. A child that meets the foster care eligibility requirements and is not in receipt of SSI benefits may be reimbursed, as per the state agreement, using the NA match symbol.

 

A child that is determined eligible under Title IV-E but is in receipt of SSI benefits is not eligible for reimbursement through the state payment system. The case will remain Title IV-E eligible but is not reimbursable until the SSI benefit has been suspended. The Tribal Nation is responsible to reimburse the foster care expenditures for any month in which the child is in receipt of SSI benefits.

 

Resources:

The Official Website of the U.S. Social Security Administration http://www.ssa.gov/

 

Training Organizational Representative Payees http://www.ssa.gov/payee/LessonPlan-2005-2.htm#WHATISORG

 

Guide for Organizational Payees - http://www.ssa.gov/payee/NewGuide/toc.htm