TN 53 (02-23)

HI 01001.190 Handling SMI Premiums for Beneficiaries Affected by the Spouse's Government Pension Offset

A. Annuitant Files for Entitlement to Auxiliary or Survivor Benefits

A Civil Service annuitant may file to establish entitlement to social security benefits on the account of the annuitant's insured spouse, even though no social security benefits may be payable due to government pension offset. This would usually occur where the auxiliary or survivor benefit rate is close to the amount of the offset, or the annuitant wants to be sure that they will suffer no loss of social security benefits in case of an amendment to the offset provision. Otherwise, an annuitant would usually choose to file for “HI only” (see HI 01001.190B in this section) so that their SMI premiums can be deducted from the annuity check rather than paying by remittance.

SMI premiums for individuals affected by the spouse's government pension offset will either be deducted from any monthly Title II benefits payable or will be paid directly by the beneficiary. SMI premiums will not be deducted from the Civil Service annuity of any individual whose Title II benefit is being offset by that annuity. (The SMI premium can be deducted from the Civil Service annuity for only uninsured (T or M) and special age 72 (J or K) beneficiaries.) Therefore, if an auxiliary or survivor beneficiary to whom the spouse's government pension offset applies is not entitled to a monthly benefit on their own SSN and if the Title II auxiliary or survivor benefit is either totally offset or offset in an amount which is insufficient to equal the SMI premium, such a beneficiary will be billed directly for the premiums. Also, in such a situation do not show any Civil Service annuity number on the award.

B. Annuitant Files for HI-Only as an Auxiliary or Survivor

Some Civil Service annuitants will choose to establish their HI entitlement by filing under the provisions explained in HI 00801.022C, HI 00801.027A, and HI 00801.032, wherein they will establish their eligibility for social security benefits but will restrict the application to “HI only.” Their entitlement to HI will be established on the spouse's work, but the award will be made on their own social security number, using the “T” BIC. Use of this procedure, particularly with the “T” BIC, will permit the Office of Personnel Management to effect deductions of the SMI premium from the Civil Service annuity check.

Individuals who are already entitled to auxiliary benefits, but subject to government pension offset, may withdraw the monthly benefit portion of their application and continue their entitlement to “HI only.” Where a withdrawal of the social security benefit portion of the application occurs, the PSC will prepare the award to establish entitlement to “HI only” on the individual's own social security number, with a BIC of “T.”

In processing an action to withdraw the monthly benefit portion of a claim, and making a “T” award on the annuitant's own social security number, the PSC will check the current premium due amount (PDA) to see what premiums are owed. The month from which premiums are currently due will be the new TEDS on the “T” award. If premiums are currently paid into the future, the PSC will diary to post the PBC 700 and TEDS when appropriate.

Not all Civil Service annuitants may wish to take advantage of the “HI only” procedure. Those whose pension offset amount is close to the amount of their suspended monthly social security benefits may choose to file for (or remain entitled to) social security benefits in the expectation that the amount of the social security benefits will eventually exceed the offset amount. Some annuitants may also wish to establish social security benefit entitlement in case there is a change in the law regarding the Government pension offset. Nevertheless, all Civil Service annuitants who are eligible for monthly social security benefits that will be subject to full offset should be made aware that they have the right to choose the HI-only procedure as a means of simplifying payment for SMI premiums.


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HI 01001.190 - Handling SMI Premiums for Beneficiaries Affected by the Spouse's Government Pension Offset - 02/02/2023
Batch run: 02/02/2023