TN 24 (09-02)
RS 00615.768 Adjustment in Simultaneous and Dual Entitlement Cases
1. Simultaneous Entitlement
Simultaneous entitlement exists when a person is entitled to the same type of benefit on two or more records.
2. Dual Entitlement
Dual entitlement exists when a person is entitled to different types of benefits on two or more records. This includes cases where the benefit may be reduced to zero.
As used herein the term decision or determination means any decision by a court, Appeals Council or administrative law judge or any initial or reconsideration determination, which awards benefits.
In the past, simultaneously and dually entitled beneficiaries were treated differently in how their entitlement affected other beneficiaries. A person entitled simultaneously to benefits as a child on two or more records could receive benefits on only one record and was considered technically entitled on the other record. A dually entitled person could be entitled to some benefits on both records.
When the simultaneously entitled child was technically entitled on the second record, that technical entitlement did not cause a reduction in the benefits payable to other beneficiaries on that record. However, dually entitled beneficiaries did cause a reduction in the benefits of other beneficiaries, even when benefits to the dually entitled person were withheld.
For example, a beneficiary entitled to benefits as a child on one record and entitled to benefits on his/her own record would receive payment on his/her own record plus any excess payable as a child. The person's full benefit as a child would be considered when determining the benefits payable after reduction for the maximum, even if the actual amount payable as a child was reduced to zero. A beneficiary entitled to child benefits on two records was paid on one record and not paid on the other record. That person's entitlement was not considered when determining the rates for other beneficiaries.
C. POLICY -- DUAL ENTITLEMENT
We are changing our policy so that all dually entitled beneficiaries will now be processed in the same manner as simultaneously entitled children. Other beneficiaries on a record will be reduced only by the amount payable to the dually entitled beneficiary before any age reduction, government pension offset or workers' compensation offset.
NOTE: This change only applies to increase the benefits to the beneficiaries who are not dually entitled. If all beneficiaries on a record are dually entitled, disregard this change. Also note that processing of simultaneous entitlement cases is not affected by this change. Only the processing of dual entitlement cases is affected.
D. POLICY -- EFFECTIVE DATE
1. First Circuit Cases
This change applies to all initial awards on which any claimant on the record lives in the First Circuit (Maine, Massachusetts, New Hampshire, Puerto Rico and Rhode Island) at any time during the period for which benefits are paid or will be payable. On those cases only, this new policy applies:
To all benefits (including retroactive benefits) payable as the result of a decision or determination made after 1/13/97, and
To all benefits (including retroactive benefits) payable as the result of a decision or determination made from 11/9/95 through 1/13/97 if the claimant asks for readjudication of that decision or determination.
This change applies to all benefits payable for 10/99 or later. This includes First Circuit cases not covered in section RS 00615.768D.1. For these cases, the change is based only on the month of payment. Any benefit payable for 10/99 or later will be processed using the new procedure.
E. POLICY -- AUXILIARIES OR SURVIVORS
When it is determined that a case meets the requirements in RS 00615.768C. and RS 00615.768D., benefits for auxiliaries or survivors after reduction for the maximum will be affected by dually entitled beneficiaries only to the extent that such person actually receives a benefit. A person who is technically entitled (or reduced to zero) will no longer affect the other beneficiaries on that record. A person who receives a partial benefit will affect the others only by the amount of the partial benefit. In other words, any benefit withheld from one beneficiary because of that person's dual entitlement will cause an increase in the benefits payable to the other auxiliaries or survivors entitled on the same record. Beneficiaries will still be limited by the original benefit amount.
NOTE: When other deduction events are involved refer to GN 02603.000 for instructions on how different events affect each other.
The following examples show the results of processing under both the old rule and the new rule. Refer to RS 00615.768D.1. and RS 00615.768D.2 to determine which rule applies.
EXAMPLE 1. Dually Entitled Beneficiary Reduced to Zero Payable
The PIA is $400.00 and the maximum is $650.00 for a numberholder, spouse and two children. After reduction for the maximum the rates would be $400.00 for A and $83.30 each for B, C2 and C1. B is also entitled on her own record. Her PIA is $100.00 which is unreduced because she is age 66. A CFM does not apply because the children are not entitled on B's record. B's benefit does not terminate because her own PIA is less than 1/2 the PIA on that record. She is therefore technically entitled as a B and her rate is reduced to $0.00. Under the old procedure, the children would have continued to receive $83.30 each. Under the new procedure the children will now receive more because of B's reduced rate. When we disregard B's entitlement, C2 and C1 are each due $125.00.
NOTE: It might appear that we could just redistribute B's $83.30, however, because of rounding each child would then be due $124.90 and lose $0.10. Instead we must redistribute the maximum to the two children. Each is then due $125.00.
EXAMPLE 2. Dually Entitled Beneficiary with a Partial Payable
The PIA is $600 and the maximum is $900 for HA, HC2 and HC1. The rates payable are $600 for HA and $150 each for HC2 and HC1. HC2 becomes entitled to his own PIA of $120. His rate as HC2 is then reduced to $30 ($150 - $120). When reducing benefits for the maximum, the PIA and the partial payable to HC2 must be subtracted.
- 30 Partial Payable to HC2
The rate payable to HC1 is then $270. We are therefore paying the full maximum of $900 by paying $600 to HA, $270 to HC1 and $30 to HC2. HC2 also receives his own PIA of $120 so the family receives a total of $1,020.
Under the old rule HC2 would be reduced to $30 while HC1 continued to receive $150 with a total payable of only $780. With HC2's own PIA of $120 the family received only $900.
EXAMPLE 3. Dually Entitled Beneficiary with Zero Payable and a Combined Family Maximum
The PIA is $400.00 and the maximum is $650.00 for a numberholder, spouse and three children. The rates are $400.00 for A and $62.50 each for B, C3, C2 and C1. B and the children become entitled on her record. Her PIA is $160.00 and is unreduced. Her maximum is $280.00. The rates on the first record are changed because of the new combined family maximum of $930.00 making the rates $400.00 for A and $132.50 each for B, C3, C2 and C1. Because her own benefit is $160.00, the B benefit is reduced to zero. (It does not terminate because her own PIA is less than 1/2 the PIA on that record.) The rates payable would be $400.00 to A and $132.50 each to C3, C2 and C1 on the first record plus $160.00 to B on her own record, for a total of $957.50.
Under the new rule we disregard B's entitlement and each child is due $176.60.
530.00 530.00 divided among 3 children equals 176.60 each.
The rates payable are then $400.00 to A and $176.60 each to C3, C2 and C1 on the first record plus $160.00 to B on her own record, for a total of $1,089.80.
EXAMPLE 4. Dually Entitled Beneficiary with Partial Payable and a Combined Family Maximum
The PIA is $400 and the maximum is $650 for a numberholder, spouse and one child. The rates are $400 for A and $125 each for B and C1. B and C1 become entitled on her record. Her PIA is $160 and the maximum is $280. Because she is age 66, she is entitled to an unreduced benefit of $160. When the maximums are combined, both B and C1 are entitled to their original benefit of $200. B's benefit is reduced to $40 because of her own PIA. C1 receives the full $200. The total payable on the first record is $640 ($400 to A, $40 to B and $200 to C1) plus B's own PIA of $160 for a total of $800.
Under the new rule, when we disregard B's entitlement, C1 is increased to $200.00 even without a CFM. However combining the maximums allows B's rate to increase to $40 just as it did under the old rule. The CFM applies because the family receives more with the CFM.
NOTE: In this case these are the same rates that would have been paid using the old method.