SI 01320.430 Effect of Spouse-to-Spouse Deeming on Optional State Supplementation

Citations:

Regulations—20 CFR 416.1163

A. Background

In response to two court rulings in California (Livermore v. Heckler) and Massachusetts (Bouchard v. Secretary ), SSA's policy of using an optional State supplementary (OSS) payment rate for an individual in the couple portion of a spouse-to-spouse deeming computation was revised. For residents of California and Massachusetts, an OSS payment rate for an eligible couple is used when determining eligibility and payment in spouse-to-spouse deeming cases to comply with the court orders.

To restore national uniformity to spouse-to-spouse deeming policy, the OSS payment computation in all cases changed, effective October 1, 1988. When calculating the amount of the OSS payment in all States with an OSS, a couple's combined countable income in excess of the Federal benefit rate (FBR) for a couple is subtracted from an OSS rate for a couple. The Federal and State payments must be computed separately, both for an individual and for a couple.

The effect of the policy change is limited to:

  • Cases where the combined income of the couple exceeds the sum of the FBR for an eligible couple plus the OSS for an individual, but is less than the sum of the eligible couple FBR and the OSS payable to an eligible couple; i.e., prior to the policy change, these individuals were ineligible; or

  • Cases where the OSS payable to a couple in the deeming computation exceeds the OSS payable as an individual, and therefore the individual State supplement is used. Prior to the policy change, the couple computation resulted in a lower payment, and so the payment was made using spouse-to-spouse deeming. Effective October 1, 1988, these cases are paid using the individual computation.

B. Definition

The term “OSS for a couple” as used below means the optional State supplement amount for both members of an eligible couple.

C. Related Policies

1. Determining Federal Eligibility/Payment

When deeming from spouse to spouse to determine eligibility for and amount of a Federal SSI payment, the income of the ineligible spouse is combined with that of the eligible individual and subtracted from the FBR for a couple.

2. Federal Payment Limitation

In no case may the eligible individual's SSI payment under the deeming rules be more than it would be if deeming did not apply.

3. State Supplement Limitation

The State supplement payable under the deeming rules may not exceed the State supplement amount that would be paid if the eligible individual were not subject to the deeming provisions.

4. Determining OSS Eligibility

  1. If combined countable income is equal to or less than the FBR for a couple, the full amount of the appropriate optional State supplementary payment will be used.

  2. If combined countable income exceeds the amount of the FBR for a couple, the optional State supplementary payment rate for a couple will be reduced by the amount of the excess income.

  3. Effective October 1, 1988, for purposes of determining OSS eligibility, the State supplementary payment rate is the higher of the rate for an eligible couple or individual.

5. Determining OSS Payment

Effective October 1, 1988, when computing payment, follow 4. above, except the optional State supplementary payment rate is the lower of the rate for an eligible couple or individual, because of the limitation in 3. above.

6. Proration

If proration applies, see SI 02005.095.

7. OSS Payment Category for Ineligible Spouse

Effective October 1, 1988, to determine the OSS for a couple, the ineligible spouse is considered to be in the same category (i.e., aged, blind or disabled) as the eligible individual. (Currently, four States vary their payment rates by category: California, Iowa, Massachusetts, and Nevada.) The State supplement rate used is the greater of:

  • The eligible couple rate for the category for which the eligible individual qualifies; or

  • the eligible individual rate (including the special rate for an eligible individual living with an ineligible spouse) for the category for which the eligible individual qualifies.

NOTE: Currently, only the States of New Jersey and Washington have a higher OSS rate for an eligible individual than for an eligible couple.

D. Operating Procedures— Effective October 1, 1988

The figures computed in 1. and 2. below for “Federal benefit” and “State supplement” will be used for comparison to determine the State supplement amount in 3.

1. Determine Eligibility/Payment as an Individual

  1. Subtract the eligible individual's own countable income from the FBR for an individual. The remainder is the Federal benefit as an individual, or excess countable income.

  2. If a Federal Benefit is due under a. above, use the full OSS for an individual, or the OSS for an individual with an ineligible spouse, in those States which provide such an OSS.

  3. If there is excess countable income remaining in a. above, subtract the excess from the OSS for an individual. The remainder is the State supplement due as an individual. (If no Federal or State benefit is due, deeming is not applicable.)

2. Follow Spouse-to-Spouse Deeming Rules

  1. Determine the ineligible spouse's earned and unearned income and follow the spouse-to-spouse deeming rules in SI 01320.400. If the ineligible spouse's total income after allocations is more than the difference between the FBR for an eligible couple and the FBR for an eligible individual, combine the eligible individual's and ineligible spouse's incomes and treat as an eligible couple.

  2. Subtract the couple's countable income (after applying appropriate exclusions and allowances) from the FBR for a couple. The remainder is the Federal benefit due a couple using the deeming rules. Where the couple's countable income is greater, excess countable income results, and no Federal benefit is payable.

  3. If a Federal benefit is due based on use of the ineligible spouse's income, the State supplement used is the full OSS for a couple who are both aged, both blind, or both disabled (depending on the category of the eligible individual's SSI benefit).

     

    If the State provides different payment variations, select the variation that applies to the eligible individual, and use the corresponding OSS for a couple.

     

    However, if the State has an individual supplement rate (including a special rate for an eligible individual living with an ineligible spouse) which is greater than the State supplement for an eligible couple, use the higher individual State supplement.

  4. If there is excess countable income remaining in step 2.b., subtract the excess from the OSS for a couple (or the individual State supplement, if greater). The remainder is the State supplement due a couple using the deeming rules. (If no Federal or State benefit is due, the individual is ineligible due to excess income.)

3. Determine Federal Benefit/State Supplement Amounts

  1. The Federal benefit amount is the lesser of:

    • The Federal benefit due as an individual (step 1.a.); or

    • The Federal benefit due using the deeming rules (step 2.b.).

  2. The State supplement amount is the lesser of:

    • The State supplement due as an individual (step 1.b. or c.); or

    • The State supplement due using the deeming rules (step 2.c. or d.).

E. Operating Procedures— Before October 1, 1988

NOTE: For residents of California and Massachusetts, see regional instructions (SI BOS01320.430).

1. Determine Eligibility/Payment as an Individual

Follow 1 above.

2. Follow Spouse-to-Spouse Deeming Rules

  1. Determine the ineligible spouse's earned and unearned income and follow the spouse-to-spouse deeming rules in SI 01320.400. If the ineligible spouse's total income after allocations is more than the difference between the FBR for an eligible couple and the FBR for an eligible individual, combine the eligible individual's and ineligible spouse's incomes and treat as an eligible couple.

  2. Subtract the couple's countable income (after applying appropriate exclusions and allowances after applying the appropriate exclusions and allowances as described in SI 01320.400B.6.) from the FBR for a couple. The remainder is the Federal benefit payable using the deeming rules. Where the couple's countable income is greater, excess countable income results, and no Federal benefit is due.

  3. If a Federal benefit rate is due under b., above, the State supplement is the full OSS for an individual (except for residents of California and Massachusetts; for months prior to 10/01/88, see regional instructions for Massachusetts at SI BOS01320.430). Offices in California with similar cases should contact the San Francisco Regional Office.

  4. If there is excess countable income remaining in b. above, subtract the excess from the OSS for an individual . (For residents of California and Massachusetts, for months prior to 10/01/88, see regional instructions at SI BOS01320.430). Offices in California with similar cases should contact the San Francisco Regional Office.

3. Determine Benefit Amount

  1. The benefit amount is the lesser of:

    • The benefit payable as an individual (from step 1.); or

    • The benefit payable using the deeming rules, including the State supplement for and individual (from step 2).

F. Documentation

1. Automated Spouse-to-Spouse Deeming Cases

The system will compute SSI eligibility and payment amount in cases involving deeming from an ineligible spouse, unless an exclusion from fully automated spouse-to-spouse deeming applies. It is unnecessary to document the claims file in automated deeming cases.

2. Manually Computed Spouse-to-Spouse Deeming

If a case is excluded from automated spouse-to-spouse deeming the deeming computation may be performed on-line using the revised deeming mask format. See Modernized System Operations Manual (MSOM ICFT16 003.001) for instructions for using the revised deeming masks for eligibility and payment computations. The file may be documented with a printout of the deeming computation.

3. Monthly Deeming Worksheet

A monthly deeming worksheet may be used in lieu of the on-line deeming eligibility and payment computations when the case is excluded from automated spouse-to-spouse deeming. The worksheet (form SSA-3123) in H. below may be used to document both Federal benefits and State supplement amounts payable in spouse-to-spouse deeming cases involving a State supplement for months beginning October 1988. Use form SSA-8015 (SI 01320.710.) only for months prior to October 1988 in cases involving a State supplement.

G. Examples— Spouse-to-Spouse Deeming Effective October 1, 1988

1. Couple's Countable Income Less than the FBR

a. Situation

In October 1988, Stephen Jones, an aged individual, lives with his ineligible spouse in their own home in New York. Mr. Jones has unearned income of $240 per month. Mrs. Jones works and earns $600 per month. There are no ineligible children in the household or any eligible aliens sponsored by Mrs. Jones.

 

b. Individual Computation

10/88 FBR$35410/88 State supp. for an individual$17.24
Minus Mr. Jones' countable income -220  
($240 - 20 general exclusion = $220)   
Federal benefit payable$134  

c. Couple Computation

10/88 FBR$532.0010/88 State supp for a couple$40.54
Minus couple's countable income -487.50  
($220 unearned +$267.50 earned = $487.50)   
Federal benefit payable$ 44.50  

d. Benefit Determination

Federal benefit for individual or couple, whichever is lower$ 44.50
State supplement for individual or couple, whichever is lower +17.24
Total benefit payable$ 61.74

 

In this example, the final result is the same as it would have been prior to October 1988.

 

2. Couple's Countable Income Exceeds the FBR for a Couple

a. Situation

In November 1988, Louise Chapman, a disabled individual, lives with her ineligible spouse in their own home in Pennsylvania. Mrs. Chapman has no income. Her husband works and earns $1,165 per month. They have no children and are not sponsoring an eligible alien.

 

b. Individual Computation

11/88 FBR$35411/88 State supp. for an individual$32.40
Minus Mrs. Chapman's countable income -  0  
Federal benefit payable$354  

 

c. Couple Computation

11/88 FBR$53211/88 State supp. for a couple$48.70
Minus couple's countable income -540   
($1,165 earned - $85 = $1,080 less 1/2 = $540) Minus excess countable income - 8.00
Excess countable income$  8State supp. payable$40.70

 

d. Benefit Determination

Federal benefit for individual or couple, whichever is lower$  0.00
State supplement for individual or couple, whichever is lower +32.40
Total benefit payable$ 32.40

 

Under the policy in effect before October 1988, Mrs. Chapman's State supplement would have been $24.40 ($32.40 minus $8.00 = $24.40).

 

3. State Supplement in Multicategory State

a. Situation

In October 1988, Kathy Anderson, a blind individual, lives with her ineligible spouse in their own home in Massachusetts. Mr. Anderson's only income is an annuity of $860 per month. Mrs. Anderson has no income. They have no children living in the household, and Mr. Anderson is not sponsoring an eligible alien.

 

b. Individual Computation

10/88 FBR$35410/88 State supp. for an individual$149.74
Minus Mrs. Anderson's countable income -  0  
Federal benefit payable$354  

 

c. Couple Computation

10/88 FBR$53210/88 State supp. for a couple (Blind/Blind Category)$469.48
Minus couple's countable income ($860 unearned less $20 = $840) -840 Minus excess countable income -308.00
Excess countable income$308State supp. payable$161.48

 

Because the eligible individual is blind, and Massachusetts is a multicategory State, the category for State supplement purposes is that of an eligible blind couple.

d. Benefit Determination

Federal benefit for individual or couple, whichever is lower$  0.00
State supplement for individual or couple, whichever is lower $149.74
Total benefit payable$149.74

4. State Individual Supplement Exceeds State Supplement for a Couple

a. Situation

In December 1988, Louis Clark, a disabled individual, lives with his ineligible spouse in their own home in Seattle, Washington. Mr. Clark receives $80 per month unearned income. Mrs. Clark works and earns $835 per month. There are no ineligible children in the household or any eligible aliens sponsored by Mrs. Clark.

 

b. Individual Computation

12/88 FBR$35412/88 special State supp. for an individual with an ineligible spouse$192.00
Minus Mr. Clark's countable income ($80 - 20 = $60) - 60  
Federal benefit payable$294  

 

c. Couple Computation

We must first determine which OSS rate to use in the couple's computation, since this particular State has a special individual rate for an eligible individual with an ineligible spouse which is higher than the rate for a couple. After using that figure in the couple computation, the result is still compared to the OSS due in the individual computation; the lower amount is the actual benefit due.

 

12/88 FBR$53212/88 State supp. payable to an eligible couple$ 22.00
Minus couple's countable income ($835 earned less $65 = $770 minus 1/2 = $385 +$60 unearned = $445) -445State supp. payable to eligible individual with ineligible spouse$192.00
Federal benefit payable$ 87Use the higher rate$192.00

 

d. Benefit Determination

Federal benefit for individual or couple, whichever is lower$  87.00
State supplement for individual or State supplement payable to eligible individual with ineligible spouse, whichever is lower +192.00
Total benefit payable$ 279.00

 

Because the State of Washington pays a higher rate to an eligible individual with an ineligible spouse than to an eligible couple, the benefit paid is the same as under the policy in effect prior to October 1988.

 

H. Exhibit

Form SSA-3123 below may be used to determine eligibility/payment in spouse-to-spouse deeming cases involving a State supplement for months beginning October 1988.

NOTE: When completing the worksheet, keep in mind these related policies which may apply:

G-SSA-3123

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SI 01320.430 - Effect of Spouse-to-Spouse Deeming on Optional State Supplementation - 01/30/2013
Batch run: 01/30/2013
Rev:01/30/2013