Author: Health and Disabilty Advocates
Last updated: March 2015
A waiver is a separate and distinct remedy from challenging the existence of an overpayment or the amount of an overpayment. A waiver is an appropriate remedy when the beneficiary was overpaid and there are reasons why it was not the beneficiary's (or client's) fault.
Advocates should be aware that challenging the existence of an overpayment by filing an appeal and seeking a waiver of repayment of the overpayment are not mutually exclusive. A beneficiary can pursue both remedies with SSA simultaneously.
A waiver can be requested at any time. In addition, a second or subsequent request for waiver may be made even though a prior waiver request was denied and the appeal period has expired. POMS GN 02201.019. Waiver may be requested after SSA has begun recovery or even after recovery is complete. POMS SI 02260.001.
For Social Security to waive recovery of an overpayment, you must demonstrate two things: 1) the beneficiary is without fault, and; 2) recovery would either defeat the purpose of the Social Security Act or be against equity and good conscience.
SSA regulations state that although SSA may have been at fault in making an overpayment, that fact does not relieve the overpaid individual from liability for the overpayment. The individual must demonstrate that he or she is without fault in causing the overpayment in order to have the overpayment waived. 20 C.F.R. §§ 404.507 (SSDI); 416.552 (SSI). In determining whether an individual is at fault, SSA will consider all pertinent circumstances, including the individual's age and intelligence, and any physical, mental, educational, or linguistic limitations (including any lack of facility with the English language) the individual has. 20 C.F.R. §§ 404.507 (SSDI); 416.416.552 (SSI).
The POMS provide the best source of law for examining waiver issues for two reasons: Requests for Waiver are submitted to SSA's local District Offices and the POMS is used as the primary source for SSA policy by the District Office staff.
POMS GN 02250.005 provides District Office staff detailed instructions for how to determine fault in overpayment cases for SSDI beneficiaries. Two important concepts discussed in POMS GN 02250.005 are a beneficiary's degree of care and good faith in preventing the occurrence of an overpayment.
A beneficiary is expected to exercise a high degree of care in preventing an overpayment. SSA will determine a beneficiary is at fault for an overpayment if facts demonstrate that either the beneficiary lacked good faith or failed to exercise a high degree of care in reporting circumstances which may have affected their entitlement to benefits or their benefit amount. POMS GN 02250.005.
Facts that show a beneficiary lacked good faith in preventing the overpayment include:
Establishing that a SSI beneficiary was without fault in an overpayment case is discussed in POMS SI 02260.015. Advocates should note that the burden of proof lies with the SSI beneficiary to prove they were without fault. POMS SI 02260.015.A.
POMS SI 02260.015 sets forth instructions for District Office staff to determine whether a SSI beneficiary is without fault in an overpayment case. According to POMS SI 02260.015, District Office staff should consider the following:
SSA makes certain presumptions about whether to hold a beneficiary "at fault" for an overpayment based on the actions of another person.
Examples of presumptions include the following scenarios:
Some SSI and SSDI beneficiaries have representative-payees who are appointed to receive a beneficiary’s monthly payments because SSA determined the beneficiary lacked the ability to manage their own funds in their own self-interest. If an overpayment occurs due to the actions or inactions of the representative payee, waiver is often warranted. SSR 64-7 provides that a beneficiary will be presumed to be “without fault” in the absence of evidence that the beneficiary knew the payments to be incorrect or deliberately concealed or misrepresented material facts contributing to the overpayment.
Showing that the beneficiary was not at fault in receiving an overpayment only satisfies part of the test for granting a Waiver Request. To complete the requirements for a Waiver, there must also be a showing as to why SSA should not enforce the overpayment. For both SSI and SSDI beneficiaries, advocates may argue waiver of the overpayment is warranted if: recovery would defeat the purpose of the SSI/SSDI programs by causing the beneficiary undue hardship, or that recovery would be against equity and good conscience.
Under a limited exception, SSA gives SSI beneficiaries an additional ground to support the granting a waiver. The waiver requirements can be met by showing that recovery would impede the efficient or effective administration of the Social Security Act.
Recovery of an overpayment will defeat the purpose of Title II of the Social Security Act if recovery would deprive the beneficiary of income required for ordinary and necessary living expenses. POMS GN 02250.100; 20 C.F.R. § 404.508. Such ordinary living expenses can include: food, clothing, rent/mortgage, utilities, insurance premiums, taxes, medical expenses, and other miscellaneous expenses. Proof that recovery would deprive the person of such income can be shown on SSA's Request for Waiver form.
SSA's recovery of the claim for overpayment will defeat the purpose of Title II if the overpaid beneficiary:
A person is presumed to not have sufficient funds if they are on a "cash public assistance" program such as SSI, VA Service and Nonservice-Connect Disability Pensions, or Temporary Assistance to Needy Families (TANF). Medicaid, unemployment, food stamps, and workers’ compensation do not count as public assistance programs. POMS GN 02250.110.
Recovery of the claim for overpayment is acceptable if the overpaid person still has possession of all or part of the overpayment amount (though it may still be against equity in good conscience). POMS GN 02250.105. In these cases, SSA may proceed to recover the debt owed to the extent of the value of the overpayment, even if the overpayment was turned into clearly identifiable assets. POMS GN 02250.105(4).
POMS SI 02260.020 provides that SSA's recovery of a claim for overpayment is considered to defeat the purpose of the SSI program if the overpaid individual is without fault and both of the following conditions are met: a) the individual needs substantially all of his or her current income to meet their current ordinary and necessary living expenses; and b) recovery would reduce the individual’s total resources to below $3,000 for a person and $5,000 for a person and one dependent. An additional $600 is allowed for each additional dependent. POMS SI 02260.020.1.
However, SSA's recovery of an overpayment would not defeat the purpose of Title XVI of the Act (SSI) if the liable individual has in their possession any of the incorrectly paid payment(s) or identifiable proceeds from such payments in liquid resources which accumulated during the overpayment period. POMS SI 02260.020.3.
A finding that SSA's recovery of an overpayment would defeat the purpose of the SSI program would result in the following scenario:
The SSI beneficiary resides in Illinois and receives the maximum SSI monthly benefit amount of $733 (for 2015) plus $85, or less. Thus, persons on SSI who have a total monthly income that does not exceed $818 a month are deemed to meet this requirement. POMS SI 02260.020.2.
For the SSDI program, there are two general grounds to argue that SSA's recovery of an overpayment would be against equity and good conscience. The first grounds is to demonstrate that a beneficiary relinquished a valuable right or changed their position for the worse in reliance on the payment of SSDI benefits or notice that SSDI benefits would be paid. POMS GN 02250.150 The other grounds that supports a finding that SSA's recovery of an overpayment would be against equity and good conscience is when a contingently liable beneficiary was living in a separate household from the overpaid person at the time of the overpayment and did not receive the overpayment. POMS GN 02250.150; 20 C.F.R. § 404.509.
Financial information is not needed for an against equity and good conscience finding. POMS GN 02250.240B.3.
The SSI Program rules set out two separate scenarios for when recovery of an overpayment by SSA would be against equity and good conscience. First is when a person changed their position for the worse or relinquished a valuable right. Second is when the person is a member of an eligible couple that is legally separated or living apart from the overpaid person when the event occurred and the person did not benefit from the overpayment. POMS 02260.025. Both positions can be further developed on the Waiver application. Financial information is not needed for the first option.
There is a separate set of rules for excess resource overpayments. Remember that because SSI is a needs-based program, resource limitations are part of a beneficiary's eligibility. An individual may not have more than $2,000 in countable resources and an eligible couple (both persons are eligible for SSI) may not have more than $3,000 in countable resources.
SSA defines "willfully and knowingly" to mean that the evidence clearly shows the individual (and spouse, if any) was both fully aware of their reporting requirements, and of the excess resources, but did not report the excess resources. POMS SI 022060.035A
If the individual has been found not “at fault” for causing the overpayment based on excess resources, then SSA applies three means tests to determine if recouping the overpayment would be against equity and good conscience for the waiver met. The three tests are as follows:
If an overpayment is $1000 or less, SSA will waive the overpayment without further development if a waiver request is made. POMS GN 02201.013. The key here is that the individual must request it. Otherwise, SSA will follow its normal collection procedures.
If a resource overpayment is caused by resources exceeding the limit by $50 or less in a given month, waiver of the overpayment for that given month should occur automatically. POMS SI 02260.035. For example, if an individual’s resources were $2011 in October, $2022 in November and $2075 in December, SSA should assess an overpayment only for December. It is important to check any resource overpayment for months in which the overpayment exceed the limit by $50 or less to make sure that SSA has not charged an overpayment for that month.
In cases where an administrative waiver is requested, it is recommended that advocates NOT fill out the SSA-632-BK (Request for Waiver of Overpayment). Rather, a Statement of Claimant Form or a simple letter written requesting waiver should suffice. SSA-632-BK inquires into fault, which does not have to be determined in these cases. Filling out SSA-632-BK only further complicates what should be a simple request.
SSA has a standard Request for Waiver form that is available on the Social Security website. In addition, the POMS provide detailed instructions on completing the waiver form as well as rules that SSA’s District Office follow in making waiver determinations. The applicable POMS sections are listed below:
Requests for waiver may be filed at any time. In addition, a second or subsequent request for waiver may be made even though a prior waiver request was denied and the appeal period has expired. POMS GN 02201.019. Waiver may be requested after SSA has begun recovery or even after recovery is complete. POMS SI 02260.001.
If the request for waiver is filed within 30 days of the date of receipt of the notice (35 days from the date on the notice), SSA will not begin overpayment recovery until the appeal or waiver is resolved. 20 C.F.R. 404.502a(h); 404.506(b).
If a SSDI beneficiary requests waiver of adjustment or recovery of a title II overpayment (SSDI) within 30 days after receiving a notice of overpayment that contains the information in §404.502a, no adjustment or recovery action will be taken until after the initial waiver determination is made. If the individual requests a waiver more than 30 days after receiving the notice of overpayment, SSA will stop any adjustment or recovery actions until after the initial waiver determination is made. 20 C.F.R. § 404.506(b)
There is no similar "automatic stay" provision in the federal regulations for SSI waivers. However, the POMS state that SSI waiver requests will also stay recovery action on an overpayment if filed within 30 days after receiving overpayment notice. POMS GN 02201.019. In addition, for waiver requests filed later than 30 days after the date of the overpayment notice, recovery will be stopped as of the month of receipt of the waiver request. POMS GN 02201.019
Once a Request for Waiver form has been completed and submitted to the appropriate SSA District Office, the advocate should follow up with the Attorney Liaison for the District Office to make sure that the Request for Waiver was received and to find out which Claims Representative will be responsible for evaluating the Request. The Advocate can then contact that Claims Representative to ensure that he or she has all the information that is needed to evaluate the Request for Waiver.
Like overpayments, adverse decisions on Requests for Waiver are considered initial determinations that may be appealed. 20 C.F.R. 404.902(k); 416.1402(c). Filing a request for reconsideration is first step in the administrative review process that SSA provides when a person is dissatisfied with the initial determination. 20 C.F.R. 404. 907; 416.1407.
The Request for Reconsideration must be filed within 60 days of the date that the person received the initial determination. 20 C.F.R. 404.909; 416.1409. SSA assumes that all mailed notices are received in 5 days so it accepts appeals filed on or before the 65th day following the initial determination. 20 C.F.R. 404.901; 416.1401 (“Date you receive notice means 5 days after the date on the notice, unless you show us that you did not receive it within the 5-day period.”). The Request for Reconsideration must be filed in writing. 20 C.F.R. 404.909; 416.1409.
The POMS provide a long list of specific circumstances in which SSA assumes individuals are or are not without fault in an overpayment case. The ability to direct District Office staff to a POMS citation in support of your client's Request for Waiver is a power tool. Please note that when reading the POMS, Title II refers to Social Security Disability Insurance (SSDI) and Title XVI refers to Supplemental Security Income (SSI).
GN 02250.020 Incorrect Benefit Rates—Waiver of Overpayment Recovery
GN 02250.022 Lack of Insured Status—Waiver of Overpayment Recovery
GN 02250.024 Duplicate Payments—Waiver of Overpayment Recovery
GN 02250.026 Subsequent Overpayments—Waiver of Overpayment Recovery
GN 02250.030 Benefits Not Terminated When Child Attains Age 16, 18, 19—Waiver of Overpayment Recovery
GN 02250.032 Family Relationship—Waiver Title II Title XVI
GN 02250.036 Payment Continuation—Waiver Title II Title XVI
GN 02250.038 Return to or Increase in Work—Disability Case—Waiver
GN 02250.040 Overpayment Caused by Receipt of Workers’ Compensation/Public Disability Benefits—Waiver
GN 02250.042 Incorrect Disposition of Property Reported Event—Waiver
GN 02250.044 Overpayment Resulting from Continued Payments to Incarcerated Felons&mda
Printed from: www.illinoisprobono.org/index.cfm?fuseaction=home.dsp_Content&contentID=7032
We welcome your comments and suggestions