TN 13 (04-19)

GN 00602.010 Current Maintenance and Personal Needs Expenditures for Institutionalized Beneficiaries

CITATIONS:

20 CFR 404.2035 - 404.2045, 416.635 - 416.645

A. Policy: Current maintenance and personal needs expenditures for institutionalized beneficiaries

Representative payees (payees) of institutionalized beneficiaries must stay informed of the beneficiary's current needs. Payees should never sacrifice the beneficiary's current needs to pay other expenses, to conserve or invest funds, or to save funds for future purposes. For information on current needs, see GN 00602.001A.2.

NOTE: The term “beneficiary” is used generically in this subchapter to refer to both title II beneficiaries and title XVI recipients. Title II and title XVI (or SSI) are specified when an instruction applies to only one type of benefit.

1. Non-Medicaid Institution

If a beneficiary is receiving care in a State, Federal, or private institution not receiving Medicaid funds on behalf of the beneficiary, the payee should give the highest priority to the beneficiary's current maintenance costs. Current maintenance includes

  1. a. 

    customary institutional charges,

  2. b. 

    expenditures for items that will aid in the beneficiary's recovery or release from the institution, and

  3. c. 

    expenditures for personal needs that will improve the beneficiary's condition while in the institution.

Payees should conserve or invest any remaining benefits, except as they may otherwise be properly used. This includes temporarily maintaining the beneficiary's residence outside the institution, unless a physician certifies the beneficiary is unlikely to return home.

2. Medicaid Institution

If a title XVI beneficiary is in a facility receiving substantial Medicaid payments on the beneficiary's behalf for the cost of care, the title XVI reduced rate must be used only for personal needs. For more information on personal needs expenditures, see GN 00602.010B.2., below. For information on the title XVI reduced rate, see SI 00520.011. The reduced rate benefit may not be used for current maintenance or past due debt incurred at the facility.

Payees for title II beneficiaries covered by Medicaid should monitor conserved funds balances so they do not exceed the Medicaid resource limit.

B. Using benefits for customary charges and personal needs expenditures

1. Customary Charges

When a beneficiary resides in an institution, the payee should allot a reasonable share of benefits for the institution's customary charges. The payee should take into account an institution's customary charges and the beneficiary's other current needs. The payee should allocate at least $30 for personal needs. If the care-providing facility complains that the payee is not contributing toward the cost of care, contact the payee for an explanation.

A payee should not pay an amount for customary charges in excess of the legal maximum charges established by individual State law. The RO should discuss questionable charges with State administrators who have oversight of institutions. Generally, the legal maximum charge relates to the cost of operation. Do not assume there is one rate for all beneficiaries. Rates can vary, depending on the State:

  • Charges may vary between beneficiaries receiving or not receiving some form of public assistance.

  • Some States set the charges for beneficiaries in institutions serving individuals with intellectual disorders considerably lower than for beneficiaries in state mental hospitals serving individuals with mental disorders.

  • Some States do not charge for care of certain types of beneficiaries; for example, children with intellectual disorders.

States often adjust rates for beneficiaries who do not have sufficient income or resources to cover the charges set by State law. States often consider more than one factor to arrive at an adjusted rate. The beneficiary's income is always an important consideration. Methods used to arrive at an adjusted rate can vary, depending on the State:

  • In some States, the institution makes an agreement with the beneficiary, or the beneficiary's representative, stating the amount the beneficiary will pay.

  • In some States, the State determines the charge by a rate schedule based on individual or family income.

The difference between the legal maximum charge and the amount institutions collect varies, depending on the State:

  • The beneficiary pays the adjusted rate, and the State waives, or "forgives" immediately, the difference between that amount and the legal maximum charge. The beneficiary is not legally liable beyond the amount agreed;

  • The beneficiary is liable for the full amount of the legal maximum charge indefinitely, as an unpaid debt owed the State. In such a State, if a beneficiary ever inherits money or has some windfall, State law obligates the beneficiary to pay the unpaid debt; or

  • The State removes the beneficiary's legal liability for the remaining charges after a certain number of years.

Institutions may set a standard allocation for each beneficiary's current needs. However, allocations may vary, depending on the institution:

  • Institutions that do not have a standard allocation usually have a maximum amount that may be spent during an established period; for example, weekly, monthly, etc.

  • In some institutions where there is no standard allocation, the social service staff in combination with the medical staff determine the level of spending for each beneficiary.

  • Some institutions may use a fixed procedure or individualized spending plan, which permits beneficiary withdrawals or expenditures as long as funds are available.

Payees should not use benefits to purchase items normally provided by the facility or covered under a State or Federal program. If the payee used SSA funds to purchase these items, the payee must apply for funding from the programs that normally provide such items and reimburse the beneficiary’s account upon receipt of the funds.

If the payee's handling of charges is improper use of benefits or adversely affects the beneficiary, consider a change of payee action. Develop fully and follow the rules for payee selection (see GN 00504.100).

2. Personal Needs Expenditures

As discussed in GN 00602.010A.2. above, the reduced rate payable for title XVI beneficiaries residing in title XIX facilities must be used only for personal needs. The Social Security Administration (SSA) has extended the policy of using this title XVI reduced rate amount only for personal needs, to beneficiaries residing in any type of facility, e.g., hospitals, nursing homes, group homes, etc. Payees should set aside a minimum of $30 per month to use for the beneficiary's personal needs or save on his or her behalf. For information on the title XVI reduced rate, see SI 00520.011.

SSA encourages payees to use good judgment in determining appropriate personal expenditures. All purchases should reflect a personal evaluation of the beneficiary's situation and needs, and should help the beneficiary keep contact with the outside world and preserve his or her sense of individuality. For residents who are unable to get to the canteen or to verbally express their needs, the institutional staff should evaluate and recommend appropriate expenditures.

Payees for SSI beneficiaries should not limit conserved funds balances to any ceiling lower than the SSI resource limit. This is because payees should not restrict themselves from making substantial personal needs expenditures or from saving transitional funds to use in the event of a beneficiary's discharge or transfer. At the same time, payees should use funds in a timely fashion and monitor high balances to ensure conserved funds never exceed the SSI resource limit, which could result in an overpayment or loss of benefits. For information on conserved funds, see GN 00603.001. For more information on SSI resource limits and how they relate to eligibility, see SI 01110.003 A.2. For information on the distinction between assets and resources, see SI 01110.100. For a listing of exclusions see SI 01110.210.

3. Examples of Personal Needs Expenditures

Some examples of acceptable personal needs expenditures are:

a. Clothing

Disability-related adaptive clothing, bathing suits and caps, boots, gloves, hats, scarves, seasonal garments, shoes, slippers, etc.

b. Convenience Items

Music players, e-readers, computers, phones, clocks, clothes hamper, stationery, televisions, wristwatches, etc.

c. Health and Hygiene Items

Bath scale, brushes, combs, nail clippers, cosmetics, cosmetic surgery, dermatology treatments, elective or cosmetic dental treatments, hairdresser or barber costs, soaps, toilet articles, etc.

d. Hobby and Craft Items

Art supplies, cameras, photo albums, games, athletic equipment, etc.

e. Living Area Furnishings

Bedspreads, blankets, carpets, curtains, lockable chest or trunk, mirrors, pictures, pillows, posters, quilts, recliner, rocking chair, etc.

f. Miscellaneous Items

Magazine subscriptions, reasonably priced holiday presents for family or friends, restaurant meals, gift cards for movies or music, etc.

g. Staff Travel Items

Using the beneficiary's funds to pay the expenses incurred by staff accompanying the beneficiary on an outing or vacation may be an acceptable use, provided:

  • a correlation exists between the expense incurred and a direct benefit to the beneficiary;

  • the beneficiary does not have unmet current or foreseeable needs;

  • the expense is reasonable in relation to the beneficiary's conserved funds; and

  • the staff member's travel expense (e.g., food, transportation, lodging, admission ticket) is not paid for by the payee organization or from another source. The payee should never use beneficiary funds to pay for a staff member's salary or hourly wage or to compensate the payee for these costs.

NOTE: A payee must obtain SSA approval prior to using benefits for staff travel items. Add a relationship note in eRPS to document the approval, see MS 07415.002 Make Note.

h. Therapeutic Equipment

If recommended by a doctor or appropriate therapist, and not covered by any other source: book holders, crawlers, electric wheelchairs, feeding aids, hearing aids, orthopedic shoes, shower and bathroom chairs, toilet aids, walkers, etc.

i. Transportation Expenses

Beneficiary's cost of travel to visit family or for relatives to visit patient in special cases, travel to amusement parks, State fairs, summer camps, etc. Payees should never use beneficiary funds for transportation costs that are normally covered by the payee organization or another source.

4. Disposition of Funds upon Discharge from a State Institution

When there are unpaid charges at the time of discharge, State law or regulations may require certain procedures for recovering funds. Procedures may vary according to the type of account. For more information, see GN 00602.030.

  • A Title XIX institution can reimburse itself from past-due benefits, only after ensuring that two months of $30 personal needs allowance ($60 total) are available.

  • Other institutions may have the option to charge some amount from conserved funds and past-due benefits, with SSA approval, if enough conserved funds are available for the beneficiary's current and foreseeable needs. Non-Medicaid institutions must provide the appropriate evidence to SSA. SSA should consider State law, regulations, and policy governing disposition of funds to ascertain whether States charged appropriately.

After a beneficiary leaves a State institution, the institution sometimes continues to serve for a period as representative payee. For instance, an institution may continue to serve as payee during a trial period, while evaluating the success of a discharge. If the beneficiary is living more independently, SSA should re-evaluate capability, per GN 00502.055. Depending on the payee and circumstances, the payee may:

  • Mail a fixed amount directly to the beneficiary; or

  • Forward the entire Social Security check to the custodian, with the understanding that a specified amount is for care and maintenance. The payee should ensure that the custodian allocates at least $30 for the beneficiary’s personal needs. Upon discharge, the payee may collect funds to cover charges for the last month the beneficiary resided in the institution. The payee cannot continue to use current benefits to recover unpaid charges.

C. Corrective action when payees use benefits inappropriately

SSA has no authority to compel a payee to spend benefits in a preferred manner. However, while the payee has judgment in spending funds, SSA has the responsibility to identify any situation or practice that disadvantages a beneficiary and to take corrective action that will be in the best interest of the beneficiary and improve payee performance.


To Link to this section - Use this URL:
http://policy.ssa.gov/poms.nsf/lnx/0200602010
GN 00602.010 - Current Maintenance and Personal Needs Expenditures for Institutionalized Beneficiaries - 04/09/2019
Batch run: 04/09/2019
Rev:04/09/2019