TN 25 (07-06)

GN 00605.562 Issues to be Covered in Onsite Reports

A. Introduction

The following topics must be addressed in all onsite review reports. This will ensure that consistent information is reported for each facility.

B. Procedure

1. Allocation of Funds for Personal Expenditures

SSA has extended the policy of using the title XVI reduced rate payable to title XVI beneficiaries residing in title XIX facilities only for personal needs to any beneficiary residing in any type of facility; e.g., hospitals, nursing homes, etc. Payees must set aside a minimum of $30 per month to be used for the beneficiary’s personal needs or saved on his/her behalf. In those States where it is determined that the monthly allocation is less than $30, the onsite report should include a recommendation to increase the allocation. See GN 00602.010B.2—Personal Needs Expenditures.

2. Maintenance Charges

When a title II beneficiary resides in an institution, the institution should allot a reasonable share of benefits for its customary care and maintenance charges. An institution’s customary charges and the beneficiary’s other current needs should be taken into account. The institution should not charge an amount for current maintenance in excess of the legal maximum charge established by the State. See GN 00602.010B.1.—Customary Charges.

Care and maintenance charges are not to be assessed against the monthly payment received by SSI beneficiaries residing in institutions which receive reimbursement under the Medicaid (title XIX) program. By regulation (416.640(c)), this payment should be used only for personal needs expenditures. If the funds of SSI beneficiaries residing in a Medicaid (title XIX) program institution have been used for care and maintenance charges, the onsite report should discuss the findings and include a recommendation regarding proper use of the SSI payment.

While it is unusual for institutional payees to continue to assess care and maintenance charges against Social Security benefits once an individual has left an institution, this issue should be covered in the report. Focus on those cases where a beneficiary who has been relocated is assessed retroactively for prior unpaid maintenance charges. In these situations, such charges would be improper if the beneficiary has current and foreseeable needs which are not being met. See GN 00602.030—Payment of Beneficiary’s Past Due Debts—Claims of Creditors.

3. Personal Use Expenditures

Generally, any expenditure which is for the personal use or benefit of the beneficiary would be an acceptable use of benefits. However, there are many expenditures which would otherwise be acceptable to SSA that the State or institution is required to provide under the State Medicaid plan. Where a State or institution is found to be making expenditures for acceptable items from the personal funds of a patient which it appears should be provided by Medicaid, the report should state that the institution, as payee, is responsible for applying for the funding and reimbursing the individual's account when it is received.

It is SSA's policy that as a general guide, personal expenditures should average at least $30 per month for all institutionalized beneficiaries. (This policy recognizes that there may be cases where expenditures of less than or more than the $30 figure will be appropriate.) Additionally, there should be no case where a beneficiary is without personal expenditures during a review year. The names of beneficiaries included in the sample for whom there were low (under $30 per month) or no personal expenditures for the entire review period should be identified for the State. This information should be furnished to the State either by letter or in the close-out meeting rather than in the onsite report because of privacy considerations.

In some instances, an institution will withhold a beneficiary's funds in order to achieve desired behavior patterns. If any cases of this nature are found in the review, the report should state the policy that personal spending cannot be denied the beneficiary to achieve a certain level of behavior.

4. Account Balances

Review the personal accounts of the beneficiaries to determine if zero balances or unreasonably low balances are being maintained. If the low or nonexistent balances cannot be explained by high levels of personal expenditures, the report should recommend corrective action.

Of equal concern is the issue of State or institution imposed ceilings on the beneficiaries' account balances. SSA opposes restrictive ceilings on balances because they limit substantial personal needs expenditures and transitional funds needed in the event of a beneficiary's discharge or transfer.

SSA recommends that ceilings on SSI beneficiaries' accounts be no lower than the SSI resource limits of $2,000 for an individual and $3,000 for a couple as set by title XVI regulations. However, institutional staff must be alerted when a beneficiary’s account balance is approaching the SSI resource limit. In these situations, staff should re-evaluate the beneficiary’s spending practices and consider other appropriate uses of the beneficiary’s funds.

NOTE: For title II only beneficiaries, it is not necessary to impose a ceiling on personal accounts. However, if the title II beneficiary is also covered by Medicaid, there may be a Medicaid limit which is often the same as the SSI limit.

If low resource ceilings are encountered, the onsite review report should include a recommendation to increase the ceiling to the SSI resource limit. The report should also cite instances where the SSI resource limit is exceeded. The local FO should be notified of these cases so that appropriate actions can be taken.

5. Manner in Which Conserved Funds are Held

If the beneficiary's current and foreseeable needs are met, any conserved funds should be saved on behalf of the beneficiary in interest-bearing accounts. As a general guide, investment in U.S. savings bonds or in individual interest-bearing accounts is preferred.

Collective checking or savings accounts are also acceptable (with prior SSA approval) provided they are properly titled, records are maintained which identify the amount contributed by each beneficiary, and the interest which accrues to the account is prorated and allocated to each individual on the basis of his/her share in the account. See GN 00603.020—Collective Savings and Checking Accounts.

The institution is required by regulation to credit interest to the individual. Under no circumstances may interest from the beneficiaries' personal funds be allocated to State revenues or placed in a general fund.

6. Direct Deposit for Institutions

a. General

The Debt Collection and Improvement Act of 1996 requires most Federal payments to be made by electronic funds transfer (EFT), with the exception of tax refunds, beginning January 22, 1999. SSA recommends direct deposit for receipt of title II and title XVI benefit payments for all beneficiaries and their representative payees. Title II and title XVI beneficiaries (or their representative payees) who indicate that payment by EFT would impose a hardship may ask to be exempted from the EFT requirement. See GN 02402.001—Direct Deposit Policy and GN 02402.055—Representative Payee Cases—Direct Deposit.

b. Individual Account

Title II and title XVI benefits paid to a representative payee can only be used for the beneficiary. The title of the account must show that the funds belong to the beneficiary and that the representative payee has only a fiduciary interest in the account. It cannot show that the State or institution is the owner of the funds. See GN 02402.055.A.2 for acceptable account titles.

  • If a noninterest-bearing account is established, funds should not be allowed to accumulate above a reasonable level to meet the current and foreseeable needs of the beneficiary. Only funds which are needed for the beneficiary's current maintenance should remain in this account. As an upper limit, where an individual beneficiary's balance exceeds $500, SSA recommends that funds be invested on the beneficiary's behalf in interest-yielding investments. Interest from the account must be credited to the beneficiary. Institutions may also consider investing funds which may not accumulate to the $500 level based upon individual assessments of the beneficiary's needs.

  • If an interest-bearing savings or checking account is established, the interest earned on the account belongs to the beneficiary.

c. Collective Account

Under certain conditions the FO may approve the use of collective checking and savings accounts established to hold monies belonging to more than one beneficiary. The title of these accounts must show that the funds are held in trust for the beneficiaries and do not belong to the State or facility operators. Additionally, funds in this account cannot be commingled with the institution's operating funds. Where direct deposit to one account is used, arrangements must be made with financial organizations to obtain sufficient data each month so that the amount of payment for each beneficiary can be recorded timely to the beneficiary's records at the institution. See GN 00603.020—Collective Savings and Checking Accounts.

  • If a collective noninterest-bearing account is used, the institution must follow the same guidelines provided for individual noninterest-bearing accounts (see GN 00605.562B.6.b—Individual Account). That is, substantial accumulation must be transferred to interest-yielding investments such as U.S. savings bonds or individual interest-bearing accounts.

  • Where funds are directly deposited to a collective interest-bearing account, any interest earned belongs to the beneficiaries and must be credited to them on a prorated basis.

NOTE: If benefit payments are not deposited into an interest-bearing account, the review team should ask the State/facility for an explanation. In many cases the reason will be that banks charge fees (service charges) on interest-bearing accounts, which exceed the amount of interest earned on the account.

7. Group Purchases

If it is found during an onsite review that group purchases using the pooled funds of beneficiaries are being considered or have been made, the report should include a reminder that all proposals for group purchases must be submitted to the RO for approval or denial prior to the purchase. Follow the guidelines in GN 00602.070—Group Purchases—Beneficiary Resides in an Institution/Nursing Home or Other Group Living Facility for evaluating group purchases.

8. Reporting Changes in Custody

When a beneficiary leaves an institution, the payee has a responsibility to report the relocation to SSA. For title II beneficiaries, if the relocation is due to a full or permanent discharge, the report must be made immediately. If the discharge is conditional or temporary, and there is a possibility that the beneficiary may return to the institution in the near future, the report may be delayed in order to avoid unnecessary paperwork for the institution and SSA. However, in no event should the report be delayed more than 90 days. For title XVI recipients, all changes in custody must be reported to SSA within 10 days of the end of the month in which the custody change happens because the amount of the SSI payment or eligibility for payments may be affected.

If the review team finds that the institution has not been reporting changes timely, recommend that the payee and the servicing FO work out a reporting process which might include developing a reporting form which can be completed by the payee and faxed to the FO for necessary action.

9. Development Where Institution Does Not Have Custody

If it is found in an onsite review that the State institution is serving as representative payee for beneficiaries for whom they no longer have physical custody, additional action may be required. Refer each sample case where a beneficiary has been out of the institution for more than 3 months to the appropriate FO for change of payee development.

10. Reporting Responsibilities

a. Work

As a general rule, the only significant work activity in terms of substantial gainful activity (SGA) and earnings occurs