TN 32 (03-15)

GN 02201.013 Administrative Tolerances Title II Overpayments

A. Rationale for administrative tolerances

For work flow purposes, we set certain administrative tolerances for restricting the amount of our collection activity on certain classes of debts.

B. When to initiate recovery

Initiate recovery based on the following conditions:

If the…

Then…

Manually computed overpayment is less than $1.00,

Do not post the overpayment to the beneficiary’s record and do not send a notice. The resources we employ to recover very minor debts may outweigh the benefit.

Automated action computed an overpayment less than $1.00,

The system will automatically send an overpayment notice and we will automatically initiate recovery.

NOTE: If the beneficiary requests waiver, grant it automatically on the basis that recovery of such a small amount will impede efficient or effective administration of the Social Security Act, per GN 02250.350.

Manually computed overpayment is:

  • $1.00 or more but less than $30, and

  • you are preparing a manual notice for a reason other than to request repayment of the overpayment (e.g., a change in the monthly benefit of a beneficiary in suspense status),

NOTE: If you do not send an overpayment notice based on the above, do not establish the overpayment.

  • Post the overpayment to the beneficiary’s record via the Debt Management System (DMS) or the Manual Adjustment, Credit, and Award Data Entry (MACADE) system.

  • Send one notice that includes information about each action. Include the required overpayment information following the instructions in GN 02201.009.

The overpayment is between $1.00 and $30 and:

  • the action is automated, or

  • adjustment can be manually proposed against the beneficiary, or

  • the beneficiary is deceased and a lump-sum death payment (LSDP) is payable (see GN 02205.003D), or

  • there are contingently liable beneficiaries on the record (see GN 02210.015),

  • Post the overpayment to the beneficiary’s record via DMS or MACADE, if the system did not do so.

  • Send an overpayment notice, if the system did not do so.

  • Include the required overpayment information following the instructions in GN 02201.009.

Overpayment is $30 or more and the beneficiary is alive,

  • Post the overpayment to the beneficiary’s record via DMS or MACADE.

  • Send an overpayment notice.

  • Include the required overpayment information following the instructions in GN 02201.009.

Overpayment is $30 or more and less than $3,000, the beneficiary is deceased, and

  • an LSDP is payable, or

  • there is a jointly liable representative payee (see GN 02205.007), or

  • there are contingently liable beneficiaries (see GN 02205.005),

NOTE: For more information regarding contingent liability and the priority order if there is more than one contingently liable beneficiary, see GN 02210.007, GN 02210.015, and GN 02210.016.

  • Post the overpayment to the deceased beneficiary’s record (if the beneficiary had a representative payee) via DMS or MACADE; or

  • Post the overpayment to the contingently liable beneficiary’s record via DMS or MACADE.

  • Send an overpayment notice to one of the following:

    • Representative payee, or

    • Estate, or

    • Contingently liable beneficiary.

  • Include the required overpayment information following the instructions in GN 02201.009.

  • Annotate DMS Remarks to document your actions.

Overpayment is $3,000 or more, the beneficiary is deceased, and there is an estate

  • Post the overpayment to the deceased beneficiary’s record via DMS or MACADE.

  • Withhold the LSDP (if applicable).

  • Send a notice to the deceased beneficiary’s estate following the instructions in GN 02215.050, GN 02215.055, and GN 02215.070.

  • Annotate DMS Remarks to document your actions.

Overpayment is $3,000 or more, the beneficiary is deceased, there is no estate, and someone is receiving benefits on the deceased beneficiary’s record,

NOTE: For more information regarding contingent liability and the priority order if there is more than one contingently liable beneficiary, see GN 02210.007, GN 02210.015, and GN 02210.016.

  • Post the overpayment to the contingently liable beneficiary’s record via DMS or MACADE.

  • Withhold the LSDP (if applicable).

  • Send an overpayment notice.

  • Include the required overpayment information following the instructions in GN 02201.009.

  • Annotate DMS Remarks to document your actions.

NOTE: The contingently liable beneficiary will have the same waiver and appeal options as the original overpaid beneficiary.

C. Extent of collection efforts for cases when the beneficiary is in non-pay status

The Recovery and Collection of Overpayment Process (RECOOP) is our automated process for billing and following up for overpaid beneficiaries in non-pay status. When an overpayment does not meet the criteria for RECOOP, we process these non-RECOOP cases manually. For more information regarding the criteria for RECOOP, see MS DMS 011.002B.

NOTE: We do not generally refer a title XVIII (Medicare) overpayment to the program service center (PSC) for collection unless the overpayment exceeds $50.00.

D. Use the following criteria to manually process non-RECOOP cases when the overpaid beneficiary is in non-pay status

1. For overpayments that are $30 or less

Take the following actions:

If…

Then…

The beneficiary does not respond to the initial overpayment notice and there is another beneficiary receiving benefits on the record,

NOTE: For more information regarding contingent liability and the priority order if there is more than one contingently liable beneficiary, see GN 02210.007, GN 02210.015, and GN 02210.016.

  • Move the overpayment to another beneficiary receiving benefits on the same record via the Establish Offset (OLP) (DROL) screen in DMS.

  • Send an overpayment notice.

  • Include the required overpayment information following the instructions in GN 02201.009.

  • Annotate DMS Remarks to document your actions.

NOTE: The contingently liable beneficiary will have the same waiver and appeal options as the original overpaid beneficiary.

There is no response to the initial overpayment notice and there is no one else currently receiving benefits on the record,

Terminate collection per GN 02215.235.

NOTE: If the overpayment is on ROAR, the system will generate a reminder notice.

An overpayment of more than $30 is reduced to $30 or less through benefit withholding and the beneficiary is no longer receiving benefits,

  • Send one refund request notice for the balance of the overpayment.

  • Terminate collection per GN 02215.235 if the beneficiary does not respond to the notice.

An overpayment of more than $30 is reduced to $30 or less through regular installment payments and the payments stop,

Follow the instructions in GN 02210.180B.2.

2. For overpayments that are more than $30 but less than $200

Take the following actions:

If there is…

Then…

No response to the initial overpayment notice and there is another beneficiary receiving benefits on the record,

NOTE: For more information regarding contingent liability and the priority order if there is more than one contingently liable beneficiary, see GN 02210.007, GN 02210.015, and GN 02210.016.

  • Move the overpayment to another beneficiary currently receiving benefits on the same record via the DROL screen in DMS.

  • Send an overpayment notice.

  • Include the required overpayment information following the instructions in GN 02201.009.

NOTE: The contingently liable beneficiary will have the same waiver and appeal options as the original overpaid beneficiary.

No response to the initial overpayment notice and we cannot recover the overpayment from a contingently liable beneficiary,

  • Send a follow-up notice to the original overpaid beneficiary.

  • Annotate DMS Remarks to document your actions.

NOTE: If within 30 days there is no response to the follow-up notice, make limited pursuit of the debt (e.g., call-in letters, telephone calls) following the instructions in GN 02210.212 and GN 02210.213.

3. For overpayments that are $200 or more but less than $3,000

Take the following actions:

If there is…

Then…

No response to the initial overpayment notice and there is another beneficiary receiving benefits on the record,

NOTE: For more information regarding contingent liability and the priority order if there is more than one contingently liable beneficiary, see GN 02210.007, GN 02210.015, and GN 02210.016.

  • Move the overpayment to another beneficiary receiving benefits on the same record via the DROL screen in DMS.

  • Send an overpayment notice.

  • Include the required overpayment information following the instructions in GN 02201.009.

NOTE: The contingently liable beneficiary will have the same waiver and appeal options as the original overpaid beneficiary.

No response to the initial overpayment notice and we cannot recover the overpayment from a contingently liable beneficiary,

  • Send a final follow-up notice to the original overpaid beneficiary.

  • Annotate DMS Remarks to document your actions.

NOTE: If within 30 days there is no response to the follow-up notice, make limited pursuit of the debt (e.g., call-in letters, telephone calls) following the instructions in GN 02210.212 and GN 02210.213.

4. For overpayments that are $3,000 or more

Take the following actions:

If…

Then…

Recovery from the debtor is unsuccessful and we cannot recover the overpayment from anyone else on the record,

  • Consider civil suit following the instructions in GN 02215.150 through GN 02215.180.

  • Annotate DMS Remarks to document your actions.

E. $1,000 Administrative waiver tolerance

For information on how to process a waiver request when the overpayment is $1,000 or less and it is clear the overpaid beneficiary is without fault, see GN 02250.350. In addition, the Kansas City Region created a decision tree to assist in determining when it is appropriate to apply this waiver tolerance. Use this link to access the decision tree: Administrative Waiver Decision Tree.

F. References

  • SM 00610.721 Recovery of an Overpayment from Other than the Overpaid Person

  • SM 00610.720 Recovery of a Title II Overpayment When the Overpaid Person is in LAF T1 – Death Case

  • GN 02210.015 Priority of Adjustment – Overpayment

  • GN 02205.005 Contingent Liability for Title II Overpayment Recovery

  • MS DMS 006.016 Establish Offset (OLP) (DROL)


To Link to this section - Use this URL:
http://policy.ssa.gov/poms.nsf/lnx/0202201013
GN 02201.013 - Administrative Tolerances Title II Overpayments - 03/17/2015
Batch run: 03/17/2015
Rev:03/17/2015