From a recent "Dear Colleague" letter from Social Security to attorneys who represent claimants before the agency:
... We offer flexible repayment plans, including payments as low as $10 per month. If they are unable to meet their necessary living expenses due to the current repayment amount, or are unable to repay the debt within 60 months*, they can request a change in the recovery rate by completing form SSA-634, Request for Change in Overpayment Recovery Rate. *This is a recent policy change. Previous policy required the completion of the SSA-634 if the overpayment could not be repaid within 36 months. ...
You know, that policy change means that it's harder to get a current repayment rate reduced. More overpayments can be satisfied in 60 months than in 36 months. Squeeze those debtors as hard as you can.
11 comments:
lol As always, SSA is damned if they do, and damned if they don't.
Prior, the logic was "Who expects an overpayment to be paid back in 36 months? Unbelievable!! And they have to do extra paperwork if they can't pay it back in 36 months!?"
SSA agrees, changes the rules to 60 months, lowering the monthly payment schedule for claimants and reducing the need for extra paperwork in a lot of cases...
Now the logic is: "Wow, now you're just squeezing debtors for all you can!!"
Tbh, I would expect more changes to come to overpayment recovery methods. I am almost certain this change was a lot easier/quicker to roll out than changing the rules of being able to waive the overpayment outright. One of O'Malley's big pushes this year is how to address inequities in under/over payments...
This policy change represents a PR move to make it seem as they are doing something, but otherwise is essentially meaningless.
Truthfully, most SSA employees ignore the policy because they simply don't have time to deal with this BS on top of everything else they have to do (and thus will accept pretty much any request made without documentation since it doesn't put extra work on their desks).
However, if a debtor does submit the SSA-634, they should make sure to include proof of income and ALL expenses (something many claimants fail to do more times than not).
And, always keep in mind the Medicare Part D subsidy loophole. If a debtor qualifies for 100% Part D extra help, he/she can request any amount of partial withholding that is at least $10.00 or more and the agency employees are required to accept it without requiring a 634 and proof of income/expenses. And, anyone who qualifies for QMB/SMB/QI-1 to pay their Part B premiums automatically qualifies for 100% Part D subsidy by default, so this is something they want to point out when making the partial withholding request (the agency employees should automatically catch it, but sadly many don't even know to look....).
I see it as allowing overpaid claimants to lower their repayment amounts by 40%.
I wonder if what they mean is that if the person proposes a repayment rate that allows the overpayment to be paid in 60 months, it will now be granted. And in the past, they had to propose a rate that would pay off the overpayment in 36 months. That actually would be better for overpaid people. But I agree that isn't exactly what's being communicated.
Yours is an interesting take, Charles. Isn’t the intention of the move from 36 to 60 months intended to help beneficiaries establish a rate of repayment without the onerous process of providing proof of income and expenses? And won’t this help reduce the paperwork FO employees have to process? Plus, folks can still request a waiver. I’m missing where SSA is squeezing anyone.
I’m confused by the comment at the end of this. Now people can simply request a lower repayment amount over the phone just so long as it can be recouped within 60 months vs. 36. If their proposed amount would not recoup the whole OP within 60 months (vs the old 36 months, more severe), they would fill out the 634. This is a favorable change to the public.
Charles, all this change does is allow agency representatives to elect lower recovery rates over a longer period without requiring financial documentation for people. This period used to be for collections exceeding 12 months and less than 36 months, now it is extended to out to 60 months.
In my experience, this change will probably benefit working people more on the RSI side of things than the DIB side. And, it isn't going to change anything for people who have large overpayment balances in collection, which are the ones in the media spotlight now. They still have the same rights as before and nothing has otherwise changed on that point.
Simply stated, there is nothing in this policy change preventing a claimant from saying "I can't afford that 60 month repayment rate you are quoting me" and then submitting a SSA-634+proof of income/expenses to try to get a lower rate.
In short, all SSA PR smoke and mirrors trying to be seen as doing something while not actually doing much. Nothing of major import hiding here, so we can move on and wait for the next big, ugly clog to hit the floor...
As others have noted, your final paragraph suggests that you're misunderstanding the effect of this policy change. Simply put, this change allows SSA to approve a *lower* rate of withholding (allowing a beneficiary to retain *more* of their check each month, while still repaying their overpayment) without going through the rigmarole of providing their financial information. It does not preclude a person from requesting an even lower rate (provided that they complete the 634, and that the requested repayment rate is at least $10/month) or to request a waiver.
A lot of people who work with beneficiaries rely on your blog for good information and value your perspective. I hope that you'll update this post to remove the unwarranted negative commentary. Policy changes may sometimes prioritize stewardship and/or the best interests of the agency over than the best interests of the beneficiary, but this isn't one of them.
Charles -- I think you are just wrong on this. As a legal aid attorney who has handled hundreds if not thousands of T. II OP cases over the past 35 years (yes that long), I believe this is a small but significant improvement. It is for claimants who cannot successfully get a lower repayment based on financial hardship. It does not diminish that option. For those folks, 60 is way better than 36.
The anonymous (SSA employee?) who posted on 3/9 at 12:26 PM incorrectly states that a SSA-634 must be accompanied with proof of “ALL expenses.” POMS GN 02250.255A states: “Ordinary and necessary living expenses do not require supporting documents, unless the expenses seem unusually high. For a list of ordinary and necessary living expenses, see GN 02250.100D1..”. The list is very extensive.
@12:15pm,
I spoke poorly. What I intended to mean was that they needed to make sure they actually included all of their actual expenses. You'd be shocked at how many people own a house, but fail to bother list both their property taxes (which in some areas are quite a significant expense) and house insurance as expenses. Or, those who have a vehicle but fail to include information about their car insurance, maintenance, and fuel expenses which are of course incidental expenses exceeding the car payment which they still have to pay.
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