SI 02901.600 General Procedures


Section 1634 of the Social Security Act
Social Security Act
Regulations 20 CFR 416.2101 - 416.2119

A. Policy Principles


Section 1634 of the Social Security Act (the act) provides that the Secretary may enter into an agreement with any State which wishes to do so to determine eligibility for medical assistance in the case of aged, blind, and disabled individuals. Apart from the agreement to make Medicaid eligibility determinations, the Secretary and the State may also enter into a Data Exchange agreement whereby the Secretary will agree to provide the State with information obtained through the SSI application process, and to give other additional support and assistance related to the administration of the State assistance programs under the authority contained in regulations No. 1 of the Social Security Administration (20 CFR 401).


The role of SSA in making determinations of Medicaid eligibility or giving information to States will be determined by agreement. The State will, of course, keep its responsibilities under title XIX. In general, SSA's role includes the following areas:

  • Determining and redetermining Medicaid eligibility for SSI recipients;

  • Providing SSI applicant information that a State requires for administering its Medicaid program. This includes assignment of rights and third party liability information; and

  • Referring applicants/recipients to local Medicaid agencies, when specified in the agreement.


One-half of the incremental administrative cost will be charged for federally administered Medicaid determinations as required under title XVI . Other information will generally be provided on a full reimbursement basis.

B. Operating Policies


  1. a. 

    The costs of Federal Medicaid eligibility determinations are derived primarily from data in the Cost Analysis System, a subsystem of the General Accounting Office approved overall SSA administrative accounting system. They include:

    • Direct time- the salary needed to perform the workload;

    • Indirect time- training, supervision, travel, staff work, and leave time; and

    • SSA field overhead rate- the cost of services provided to the field by central office components and a portion of the centralized common expenses account.

  2. b. 

    The agreement may specify the rate of reimbursement. Billing will be made by SSA no less frequently than annually, not more frequently than quarterly on a fee schedule basis (see SI 02901.610, Exhibit 1). Charges to the State in a fiscal year will be computed by multiplying the unit cost reflected in the schedule by the number of items delivered.


Each billing period, SSA will send the State an original and two copies of form SSA-1036 (see SI 02901.610, Exhibits 2 and 3). The form will include:

  • Description of the services performed;

  • Number of work units;

  • Unit cost for which the State is being billed; and

  • Address where payment is to be made.

The State will be billed during the first month after the end of each billing period, and should remit the amount due within 30 days of receipt of the bill, with a copy of the billing form to identify the payment. Questions on billing problems, including disagreement with the amounts involved and how the amounts were computed should be directed to the ARC, Programs. Also, the ARC, Programs, is to be informed of the name, title, address, and telephone number of the State official to whom billing problems should be directed.


The State should supply SSA with the title of the State official and address to whom billing forms should be sent. This information should be forwarded to the address shown in SI 02901.520 B.2.


    Social Security Administration

    Office of Supplemental Security Income

    Attn: State Supplementation and Related Programs Branch

    3-K-1 Operations Building

    6401 Security Boulevard

    Baltimore, Maryland 21235-6401

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SI 02901.600 - General Procedures - 05/20/1999
Batch run: 05/20/1999