TN 16 (04-90)
GN 02210.070 Partial adjustment of overpayment to collect SMI premiums
Any part of a title II benefit needed to repay SMI premiums will be applied to the premium obligation (including any arrearage) before any withholding to recover an overpayment.
This partial adjustment for SMI is effectuated without the need for a protest from the beneficiary or a decision that full withholding is causing hardship.
If an overpayment is being recovered by full withholding when SMI premium liability begins, the premium amount will be deducted first and the balance of the monthly benefit credited toward the overpayment.
If a beneficiary protests full withholding and qualifies for partial adjustment, the partial adjustment rate will be established before any deduction for SMI premiums.
Mae Fields has been overpaid benefits for 10 months at the rate of $100 per month. Her SMI premium is being deducted from her benefit each month. Her $1000 overpayment will be recovered by withholding the balance of her monthly benefit minus the SMI premium.
In 4/88, Alex Able's annual report shows that he was overpaid for 1987 but his benefits have been suspended for work from 1/88 on. His SMI premiums for 1986 were deducted from his monthly benefit. In 8/88, he notified SSA that he stopped working late in that month and he is eligible to receive benefits beginning 9/88 (payment due 10/3/88). However, he owes premiums for the 3 month period 7/88-9/88 and an additional amount must be deducted for 10/88. Accordingly, his benefit for 9/88 will be reduced by SMI premiums due for 4 months and the remaining benefit applied to the overpayment.