Identification Number:
GN 02230 TN 10
Intended Audience:See Transmittal Sheet
Originating Office:DCBFM OFPO
Title:Special Overpayment Procedures
Type:POMS Transmittals
Program:All Programs
Link To Reference:
 

PROGRAM OPERATIONS MANUAL SYSTEM
Part GN – General
Chapter 022 – Overpayments
Subchapter 30 – Special Overpayment Procedures
Transmittal No. 10, 02/06/2019

Audience

FO/TSC: CS, CS TII, CS TXVI, CSR, CTE, DRT, FR, OA, OS, RR, TA, TSC-CSR;
PSC: BA, CCRE, CS, DCR, DS, LDCR, LDS, PETE, RECONR, SCPS, TSA, TST;
OCO-OEIO: BTE, CR, EIE, FCR, PETL, RECONR, RECOVR;
OCO-ODO: BTE, CCE, CST, CTE, CTE TE, DSE, PAS, PETE, PETL, RC, RCOVTA, RECOVR;

Originating Component

OFPO

Effective Date

Upon Receipt

Background

The Office of Financial Policy and Operations, Office of Payment and Recovery Policy conducted editorial review of the procedures to reflect current best practices. This transmittal does not introduce new policy or procedures.

Summary of Changes

GN 02230.050 Civil Monetary Penalty (CMP) - Overview

We revised and reformatted the content where necessary.

Subsection C.1

  • Revised instructions to change the penalty amount up to $8,249

  • Added a chart with historical penalty amounts.

Subsection E

  • Added a hyperlink to related instructions

GN 02230.055 Civil Monetary Penalty (CMP) - Posting

The Office of Financial Policy and Operations, Office of Payment and Recovery Policy conducted editorial review of the procedures to reflect current best practices. This transmittal does not introduce new policy or procedures.

GN 02230.055 Civil Monetary Penalty (CMP) – Posting

We made several content revisions and reformatted where necessary.

Subsection A

  • Changed the penalty amount up to $8,249

  • added a reference to related instructions

GN 02230.050 Civil Monetary Penalty (CMP) - Overview

A. Background of CMP

SSA refers a person suspected of fraud or other misconduct to the Office of the Inspector General (OIG).

If OIG investigates and validates that fraud or other misconduct occurred, it refers the matter to the U.S. Attorney to consider an action for civil or criminal false statements and related misconduct.

If the U.S. Attorney declines to prosecute and issues the formal “declination” required by statute, OIG may refer the case to its Office of Counsel to the Inspector General (OCIG) to consider imposing a Civil Monetary Penalty (CMP) and any assessment.

If OCIG determines the case meets the legal requirements for a CMP, it contacts the individual by mail to advise it is considering a CMP and to request the individual to provide information regarding his or her financial circumstances.

If the individual responds, OCIG may attempt to negotiate a reasonable settlement, in light of the individual’s financial circumstances, the seriousness of the offense, and other aggravating or mitigating circumstances specified by Congress in the statute.

If the person does not respond, OCIG sends the individual a second notice that addresses any known information about the individual’s financial and other circumstances and proposes to impose the CMP. The notice advises where the individual should send payment and how to request review of the fine.

Thereafter, the individual has 60 days to seek review of the proposed action and request a hearing by the U.S. Department of Health and Human Services’ (HHS) Departmental Appeals Board (DAB) in Washington, D.C.

If the individual does not seek review within 60 days, OCIG relies upon the record information that is available and notifies the individual of its decision to impose a CMP. The notice imposing a CMP includes a demand for payment.

B. Policy regarding CMP

We do not initiate CMP actions. OCIG receives a referral of suspected fraud or other misconduct from within SSA or from the 1-800 Fraud Hotline and initiates action.

The SSA Commissioner delegated the authority to pursue and impose CMPs to OIG, and OIG re-delegated the authority to OCIG. SSA Operations is responsible for posting the CMP on the MBR and/or SSR and for collecting CMPs.

C. SSA authority to impose and collect CMPs

CMPs can have two parts the penalty and the assessment.

1. Penalty for CMP

The Social Security Act authorizes the Commissioner to impose a penalty of not more than $8,249 for each:

  • False or misleading statement or representation of fact that is material to determining an initial or continuing right to, or amount of, monthly benefits or payments under Title II, Title XVI, or Title VIII of the Act;

  • Misuse of benefits by representative payees; or

  • Knowing omission or withholding disclosure of material fact to SSA.

NOTE: The Federal Civil Penalties Inflation Adjustment Act Improvement Act of 2015 established an annual requirement to update penalties for inflation. The table shows historical CMP penalty amounts.

Year

Penalty Amount

2017 and before

Up to $5,000

2018

Up to $8,249

2. Assessment of CMP

The Act authorizes the Commissioner to impose an assessment in lieu of damages. The assessment represents the overpayment that occurred as a result of the fraud or other misconduct. The law authorizes the Commissioner to impose an assessment that is equal to or up to twice the amount of the overpayment that resulted from the false or misleading statement, representation, omission of fact, or misuse of benefits.

NOTE: OCIG may initiate a proceeding to impose a penalty and assessment within 6 years of the date the violation occurred.

3. Collection authority

Operations is responsible for posting the CMP on the MBR and/or SSR and for collecting the debt once imposed and final. Regulations allow SSA to pursue recovery of CMPs by:

  • Withholding monthly Title II benefits;

  • Withholding monthly Title XVI benefits;

  • Withholding monthly Title VIII benefits;

  • Billing and follow-up; and

  • Initiating a civil action.

IMPORTANT: In the future, SSA may also apply the following collection methods:

  • Reducing tax refunds to which the person is entitled;

  • Using Administrative Wage Garnishment (AWG), Administrative Offset (AO), Federal Salary Offset (FSO), and credit bureau reporting; and/or

  • Charging interest and fees associated with collecting these debts.

D. Processing the CMP

1. OIG processing

The Commissioner delegated OIG authority to pursue and impose CMPs.

  • CMP proceeding begins when SSA or an external source refers a suspected case of fraud or other misconduct to OIG’s Office of Investigations (OI). If the U.S. Attorney finds evidence of fraud or other misconduct but declines to prosecute the case as a criminal or civil action, OI will refer the case to OCIG. OCIG considers imposing a CMP. See also, referring cases to OIG for possible fraud investigation, see GN 04110.000.

  • The U.S. Attorney declines to prosecute the case and OCIG determines the case meets the legal requirements to impose a CMP, it contacts the individual via certified mail to advise it is considering a CMP. OCIG issues the following letters:

    Notice letter – OCIG advises the individual it is considering imposing a CMP and provides 30 days to respond with financial and other relevant information before it issues a formal decision to impose the CMP.

    Demand letter – OCIG proposes to impose a CMP and identifies the amount of the penalty and any assessment. The individual has 60 days to request a hearing to review the proposal. If the individual does not request a hearing after 60 days, the CMP becomes final.

    Default letter – If the individual fails to respond timely to the demand letter by requesting a hearing, by paying the proposed CMP, or by pursuing a settlement agreement with OCIG, OCIG informs him or her that he or she owes the CMP and must send SSA payment or SSA will initiate collection efforts.

  • If the individual responds to any of the letters, OCIG may attempt to negotiate a reasonable settlement depending on the individual’s financial circumstances, the seriousness of the offense(s), etc.

  • After completing any administrative and judicial review and assuming the final decision sustains the CMP, OCIG issues a final letter to the individual that summarizes the outcome and advises of the need and method to satisfy the debt. OCIG provides a copy of this letter to Operations.

    NOTE: OCIG prepares these letters. The letters are not stored in the Online Retrieval System (ORS).

2. How the CMPs can be imposed

a. Settlement agreement

OCIG’s negotiations with the individual result in a mutually agreed upon amount and repayment plan to pay off the CMP.

b. Default

OCIG prepares and issues the notice and demand letters, and the individual does not respond. OCIG issues a letter imposing the CMP after the end of the notice and demand periods required to satisfy the individual’s due process rights.

c. HHS Administrative Law Judge (ALJ) decision

The individual seeks review of OIG’s demand letter proposing to impose a CMP, the HHS ALJ rules in favor of SSA/OIG, and the individual does not seek further review.

d. HHS DAB decision

The individual or OCIG appeal the HHS ALJ’s decision and:

  • The DAB issues a Recommended Decision in SSA/OIG’s favor;

  • The Commissioner declines to reverse or modify the DAB’s Recommended Decision within 60 days;

  • The DAB issues correspondence identifying the Recommended Decision as the Commissioner’s final decision; and

  • The individual does not seek review by a U.S. Court of Appeals within 60 days.

e. Commissioner decision

The Commissioner reverses or modifies the DAB’s Recommended Decision within 60 days and rules in SSA/OIG’s favor, and the individual does not seek review by a U.S. Court of Appeals within 60 days of the DAB publishing the Commissioner’s decision as final; or

f. U.S. Court of Appeals decision

The individual or OCIG appeals the final administrative decision (DAB’s or Commissioner’s decision) to the appropriate U.S. Court of Appeals and rules in SSA/OIG’s favor.

After completing all opportunities for administrative and judicial review, OCIG or the Office of General Counsel (OGC) forwards the final decision imposing or sustaining the CMP via e-mail to the SSA headquarters Deputy Commissioner of Operations contact in the Office of Public Service and Operations Support (DCO/OPSOS). OCIG or OGC provides a courtesy copy of the final decision imposing or sustaining the CMP to the SSA office that initially referred the case to OIG, if available.

NOTE: The courtesy copy is information only. No action is necessary. OPSOS forwards the documents supporting the CMP to the designated Regional Office (RO) or Program Service Center (PSC) CMP contact for processing.

E. SSA processing of CMP

OCIG forwards the case information to the DCO/OPSOS/CMP Headquarters coordinator for all CMPs.

OGC may forward the case if the CMP became final at the HHS ALJ level or above.

SSA components cannot directly refer to OCIG to consider a CMP. To refer cases to OIG for possible fraud investigation, see GN 04110.000.

  1. 1. 

    Operations is responsible for posting the CMP on the MBR and/or SSR and for collecting the CMP.

  2. 2. 

    The DCO/OPSOS/CMP coordinator based on the information, forwards the case to the RO or PSC contact that will be responsible for posting and for tracking the CMP case.

  3. 3. 

    See a list of the RO/PSC CMP contacts and the DCO/OPSOS/CMP coordinators in GN 02604.420E.

F. How to assign CMPs to the RO or PSC

  1. 1. 

    DCO/OPSOS/CMP coordinator forwards the CMPs to the RO or PSC CMP contacts for processing based on where the CMP will be posted (MBR/SSR), regardless of the program in which the violation occurred.

  2. 2. 

    PSC, according to MBR jurisdiction, receives the CMP documentation from the CMP coordinator to post the CMP to the MBR or ROAR record.

  3. 3. 

    RO, according to the individual’s residence location (mailing address on the OCIG correspondence), receives the CMP documentation from the CMP coordinator to post the CMP to the SSR.

    EXAMPLE:

    • CMP imposed for Title II violation

    • Person has no MBR

    • Person is in current pay in Title XVI

    • CMP should post to the SSR

    • CMP is sent to RO for processing/posting

  4. 4. 

    A CMP case may require action on both the MBR and SSR (e.g., CMP posted to SSR and Remarks and/or Special Messages added to the MBR and Debt Management System (DMS)). The CMP coordinator should send the case to both the PSC and RO CMP contacts. The first addressee on the route slip is responsible for posting the CMP and adding Remarks/Special Messages to that record. The subsequent addressee(s) is responsible for adding Remarks/Special Messages on other program records involved. Coordinate actions so all records involved in the posting are documented.

    EXAMPLE:

    • CMP imposed on representative payee of Title XVI recipient

    • Representative payee has no MBR or SSR

    • CMPs should post to a Title II ROAR record and remarks entered in DMS, Title XVI recipient’s SSR, and the Representative Payee System (RPS)

    • The CMP is sent to the PSC to establish the ROAR and to enter remarks in DMS, and also sent to the RO to enter remarks on the recipient’s SSR and RPS.

G. CMP collection

1. Who is responsible for paying the CMP?

The individual named in the imposition of the CMP is solely responsible for paying the CMP debt. If the person dies, SSA should seek payment from that individual’s estate. For information on estate development procedures, see GN 02230.060H.

2. Collection of a CMP from auxiliaries

The individual named in the imposition of the CMP is solely responsible for paying the CMP debt.

If the CMP is posted to a record containing auxiliaries,

  • Do not collect the CMP from the auxiliaries.

  • Do not transfer the debt to the auxiliaries’ records.

For information on CMP auxiliary procedures, see GN 02230.060E.

3. Collection of a CMP from an underpayment

Apply any underpayment due the debtor toward the recovery of a CMP. For information on CMP underpayment procedures, see GN 02230.060D.

4. Rate of withholding from benefits under Title II and Title XVI

When a signed settlement agreement exists, withhold at the rate specified in agreement between OCIG and individual.

When no settlement agreement exists and the CMP is imposed by default, the withholding rate from current benefits or payments must be 100 percent.

5. Debtor seeks to pay at a rate different than rate in signed settlement

If the debtor previously signed a settlement agreement with OCIG and requests a change in the monthly payment amount stated in the settlement agreement, use the form SSA-640 (Financial Disclosure for CMP Debts) to obtain the following information from the debtor:

  • Identifying information (name, address, SSN)

  • Number of dependents

  • Employer information (debtor and spouse)

  • Monthly income (debtor and spouse)

  • Sources of monthly income (salary, bonuses, rental income, worker’s compensation, Federal or state benefits/payments, interest, etc)

  • Monthly expenses (rent, utilities, groceries, transportation, medical, credit cards, loans payable to banks, insurance premiums, etc.)

  • List and value of assets (bank accounts, stocks, insurance policies, autos, public assistance, etc.)

  • List of liabilities, unpaid balance (mortgage, auto, credit cards, taxes owed, judgments)

Once received, the RO CMP Contact will verify that the information is correct and properly documented, then forward the information to ^DCO OPSOS CMP. The Office Of Public Service and Operations Support (OPSOS) will review the information and the Associate Commissioner of OPSOS will make a decision on whether or not we will approve the SSA-640 request. After a decision is made, OPSOS will notify the RO and the RO will process the request accordingly, including sending the debtor a decision notice.

6. Compromise CMP offer

During the CMP process and before the CMP became final, the person had the opportunity to request a compromise of the CMP amount OCIG intended to impose. Only the Commissioner of SSA has authority to compromise the amount of the CMP debt after it is imposed. No further delegation of authority exists. For information on compromise offer procedures, see GN 02230.060G.

7. Installment agreements

In the future, if the Commissioner authorizes Operations to consider CMP debtors’ requests to pay in installments and a CMP was imposed by default, the debtor may request to pay the CMP in installments. Currently, only the Commissioner can approve such requests. However, the Agency is not prohibited from accepting any payment(s) a CMP debtor offers if no employee suggests that accepting less than the full amount of the debt created an installment agreement.

8. Waiver of CMPs

CMPs are not subject to waiver. CMPs are fines resulting from fraud and other misconduct; the regulations do not permit waiver of fines arising from fraud and other misconduct.

9. Administrative sanctions for CMP

To avoid interfering with other proceedings, SSA does not pursue administrative sanctions until OIG determines whether it will pursue criminal, civil, or CMP action. OCIG notifies the referring SSA office of the decision whether to pursue a CMP and provide a courtesy copy to the RO.

The agency should continue to defer pursuit of the sanction while any CMP proceeding is ongoing. If appropriate, SSA can pursue administrative actions.

See Details

For administrative sanctions when there is a CMP proceeding see

10. Bankruptcy and CMPs

CMPs are considered fines (not overpayments), which are not subject to discharge in bankruptcy. If the CMP includes an assessment, contact the Regional Chief Counsel. See procedure for CMP debtors involved in bankruptcy proceedings in GN 02230.065B.3.

11. Effect of CMP on continued eligibility to serve as payee

Do not appoint a representative payee applicant who has had a CMP imposed on him or her unless

  • you have evidence that he or she poses no risk to the beneficiary,

  • there are no other more suitable applicants, and

  • the debt has been satisfied or currently being paid per a settlement agreement.

Develop for a more suitable payee when there is an imposition of a CMP on the current representative payee.

See Details

  • GN 00502.000, Determining the Need for, Developing and Selecting a Representative Payee - Table of Contents

  • GN 00502.132 B.3.c. Instructions for representative payees applicants with CMPs imposed

12. How to contact OCIG

The name and phone number of the OCIG attorney involved in the case is in the case documentation sent to Operations. If questions arise about the case that need input from the OCIG attorney involved:

  • FO requests RO CMP Contact to contact the DCO/OPSOS/CMP coordinator who contacts the OCIG attorney involved .

  • PSC requests DCO/OPSOS/CMP coordinator to contact the OCIG attorney involved in the case.

H. Debtor notification of collection of CMP

1. Notification to debtor of SSA’s intent to collect CMP

The OCIG demand letter satisfies SSA’s obligation to provide at least one notice demanding payment. OCIG’s demand letter notifies the person that it has imposed a CMP against him or her and advises the debtor to send his or her payment to SSA and provides the Mid-Atlantic Program Servicing Center (MATPSC) P.O. Box address. The address is:

Social Security Administration

MATPSC

P.O. Box 3430

Philadelphia, PA 19122

If the debtor does not send his or her payment, SSA must begin collection efforts. SSA is not required to send further notice of its intent to collect the CMP debt.

2. Notification when benefit withholding is involved

Although SSA is not required to send further notice of its intent to collect the CMP debt, it is the Agency’s practice to send the debtor a notice of planned action when it plans to withhold Title II benefits or Title XVI payments to collect a debtor’s CMP.

The notice of SSA’s intent to withhold benefits

  • is manually prepared from AURORA or from Document Processing System (DPS).

  • includes paragraphs appropriate either to full withholding or to partial withholding (partial withholding according to an OCIG settlement agreement).

  • is available in DPS in the overpayment folder and in AURORA with the exhibit forms number E3963.

See the CMP withholding notice in NL 00703.963. A Spanish language version of this notice is available only in DPS. For information on the Spanish cover letter see NL 00601.600C.2.

NOTE: This notice contains limited appeal rights. The individual has the right to appeal whether SSA is collecting the CMP from the correct person and whether the CMP amount is correct. These appeal rights relate to SSA’s collection of the CMP, not to OCIG’s actions to impose the CMP.

3. Notification for use of debt collection tools

The law also requires SSA to send notices before taking other specific actions (e.g., offset against Federal payments, administrative wage garnishment, and sending information about the debt to consumer reporting agencies).

SSA plans to implement collection of CMPs via all authorized debt collection tools and develop CMP-specific notices.

GN 02230.055 Civil Monetary Penalty (CMP) - Posting

A. Posting a CMP

Regardless of the program in which the violation occurred, SSA can collect the CMP from any benefits the debtor is currently receiving.

See the Chart of Scenarios for posting CMPs in GN 02230.055B in this section.

For trust funding instructions see GN 02230.055A.8 in this section.

1. Parts of a CMP

CMPs can have two parts, the penalty, and the assessment.

Penalty – The penalty is an amount determined by the Office of Counsel to the Inspector General (OCIG) that relates to the number of instances the person falsified, withheld information from SSA, or engaged in other program-related misconduct. OCIG can impose a penalty of up to $8,249. The penalty amount is adjusted annually.

For historical penalty amounts for each violation, see GN 02230.050C.1.

Assessment – The assessment (or assessment in lieu of damages) represents the overpayment caused by the fraudulent action or other program-related misconduct. The assessment takes the place of the overpayment and may be equal to, greater than, or occasionally less than the overpayment caused by the misconduct. Therefore, adjust the record when posting the assessment so that SSA does not collect both the overpayment and the assessment. OCIG may not always impose an assessment when it imposes a penalty.

IMPORTANT: Always post a CMP in its entirety as one amount (penalty and assessment combined), unless State Supplementation is involved in the overpayment. For instructions on posting CMPs to the SSR when State Supplementation is involved, see GN 02230.055A.5.

2. Posting the penalty amount of a CMP

OCIG’s transmitting route slip (or other final administrative or judicial decision) specifies the amount of the penalty imposed.

Post the penalty to the record of the program in which the violation occurred. If collection can happen by posting the CMP to the debtor’s record other than the program where the violation occurred, post the CMP to that record. See instructions for posting the penalty to the MBR/SSR in GN 02230.055A.4.-5 and GN 02230.055A.8.

Penalty imposed but no assessment imposed

If OCIG imposed a penalty but did not include any assessment in the CMP, and the violation occurred in one program and collection can be accomplished by posting the penalty to the debtor’s record in another program, post the penalty to the record in the other program. Include Remarks or Special Messages on all records involved identifying the program where the violation occurred.

3. Posting the assessment amount of a CMP

If an assessment is imposed,

  • The amount can be less than, equal to, or up to twice the amount of the overpayment that occurred as a result of the statement, representation, or other misconduct, which was the basis for the penalty.

  • The overpayment represents the damages sustained by the United States as a result of the person’s actions or omissions, and SSA collects the assessment instead of the overpayment.

SSA cannot collect both the assessment and the overpayment amount.

If the assessment is equal to or more than the overpayment.

  • Reduce the overpayment to zero and

  • Post the entire CMP amount. See instructions for posting the assessment to the MBR/SSR in GN 02230.055A.4.-5.

EXAMPLE 1 : CMP Imposed and assessment greater than overpayment

Overpayment on record

$ 5,000

CMP imposed

Penalty

$ 3,000

Assessment

$10,000 (2 times overpayment amt)

Total CMP

$13,000

Reduce Overpayment to zero

Title II

use TC 53, Reason code 97, via DRWD screen

(suppress any waiver decision notice)

Title XVI

use Z TAC for terminated records and

records with a force pay flag (FFLF) use NT TAC for all other Title XVI records

NOTE: A NT TAC in excess of $2,000 requires management approval. A NT TAC in excess of $20,000 requires RO approval. See 02220.005

Post $13,000 CMP

Title II

under TOE Code 61 via SMED screen

(MSOM DMS 002.003)

Title XVI

use a P TAC via UOMA screen as a Federal amount. This will show as a P99 on the SSR

(MSOM BUSSR 004.014)

Add Remarks and/or Special Messages to the record that a $13,000 CMP was imposed and the overpayment was reduced because of the assessment.

Sample Remarks and/or Special Messages for this scenario: $13K CMP ($3K PENALTY & $10K ASSMNT) ASSMNT REPRESENTS 2X O/P AND O/P REDUCED TO ZERO-DO NOT DELETE REMARK

If the assessment is less than the overpayment, reduce the overpayment amount by the assessment amount. The remaining overpayment balance is subject to normal overpayment recovery procedures. Post the entire penalty and assessment amount.

EXAMPLE 2 : CMP Imposed and assessment less than overpayment

Overpayment on record

$ 15,000

CMP imposed

Penalty

$ 5,000

Assessment

$10,000

Total CMP

$15,000

Reduce the Overpayment on record to

$ 5,000

Title II

with TC 53, Reason code 97, for $10,000 or

Title XVI

with Z TAC for $10,000 (terminated or force pay flag record) or

with NT TAC for $10,000 (other than terminated record)

Post Combined Penalty and Assessment

(same as in example 1 above)

$15,000

Add Remarks and/or Special Messages to the record that a $15,000 CMP was imposed and the overpayment was reduced because of the assessment.

Sample Remark for this scenario: $15K CMP ($5K PENALTY & $10K ASSMNT) ASSMT REPRESENTS 2/3s OF O/P- O/P REDUCED TO $5K-DO NOT DELETE REMARK

4. Posting a CMP to the MBR

a. Debtor in current pay status for Title II

  1. 1. 

    Post the entire CMP amount to the debtor’s MBR using Type of Event (TOE) Code 61. See instructions on how to establish a debt in MSOM DMS 002.003.

  2. 2. 

    Establish the debt under the name and SSN of the person the CMP was imposed on. For example, if the CMP was imposed on a representative payee for Double Check Negotiation (DCN) of the beneficiary’s benefits, establish the CMP on the representative payee’s own record under the representative payee’s name and SSN. Do not put the CMP on the beneficiary’s record.

    NOTE: If the CMP debtor does not have their own MBR, but is receiving benefits as an auxiliary (e.g., receiving benefits as a C1), post the entire CMP debt to the individual’s record of entitlement under their BIC.

  3. 3. 

    Establish the recovery rate. The recovery rate should be the negotiated rate stated in the settlement agreement or full withholding if there is no settlement agreement. Full withholding applies because the CMP is a result of fraud or related misconduct. See instructions on how to establish the recovery rate in MSOM DMS 006.015.

  4. 4. 

    Input a TC 53, Reason code 97 (Other), to reduce the overpayment represented by the assessment. Do not adjust the CMP amount when posting to the record. Post the CMP in its entirety. See examples of posting the assessment amount of a CMP in GN 02230.055A.3.

  5. 5. 

    Add a fraud indicator. See how to post a fraud indicator in GN 02230.055A.7.

  6. 6. 

    Add DMS Remarks and a Special Message on the MBR that include:

    • Amount of the CMP;

    • Any associated SSNs;

    • That the CMP is not subject to waiver or discharge in bankruptcy;

    • The overpayment was reduced because of the assessment (if applicable);

    • A remark stating not to delete the Remarks; and

    • Any additional necessary information.

  7. 7. 

    Send a notice stating that SSA plans to start withholding the person’s benefits to collect the CMP debt. See the CMP withholding notice in NL 00703.963.

b. Debtor in non-pay status for Title II

  1. 1. 

    Post the entire CMP amount to the debtor’s MBR using Type of Event (TOE) Code 61. If there is no MBR, establish a ROAR using TOE Code 61. See instructions on how to establish a debt in MSOM DMS 002.003.

  2. 2. 

    Establish the debt under the name and SSN of the person the CMP was imposed on. For example, if the CMP was imposed on a representative payee for DCN of the beneficiary’s benefits, establish the CMP on the representative payee’s own record (or a ROAR record), name, and SSN. Do not put the CMP on the beneficiary’s record.

    NOTE: If the CMP debtor does not have their own MBR, but is entitled as an auxiliary (e.g., entitled as a C1), post the entire CMP debt to the individual’s record of entitlement under their BIC.

  3. 3. 

    Input a TC 53, Reason code 97 (Other), to reduce the overpayment represented by the assessment. Do not adjust the CMP amount when posting to the record. Post the CMP in its entirety. See examples of Posting the Assessment amount of a CMP in GN 02230.055A.3.

  4. 4. 

    Add a fraud indicator. See how to post a fraud indicator in GN 02230.055A.7.

  5. 5. 

    Add DMS Remarks and a Special Message on the MBR that include:

    • Amount of the CMP;

    • Any associated SSNs;

    • That the CMP is not subject to waiver or discharge in bankruptcy;

    • The overpayment was reduced because of the assessment (if applicable);

    • A remark stating not to delete the Remarks; and

    • Any additional necessary information.

  6. 6. 

    There is no notice required for a non-pay situation.

5. Posting a CMP to the SSR

Currently, there is no specific Decision Code for CMPs. If no State Supplementation is involved, post the CMP in its entirety as a Federal amount to the SSR as a P TAC using the MSSICS UOMA screen. This will create a P99 TAC in the OPDD segment of the SSR. For information on the MSSICS UOMA screen, see MSOM BUSSR 004.014.

If there is an assessment that represents the overpayment and there was State Supplementation involved in the overpayment, post the CMP by breaking down the CMP into a Federal and a State amount.

IMPORTANT: Add Remarks to the SSR identifying the Overpayment Sequence (OPSQ) number(s) where the CMP is posted. For more information on the OPSQ segment, see SM 01311.035.

a. Debtor in current pay status for Title XVI

  1. 1. 

    Post the CMP to the SSR as a P TAC using the MSSICS UOMA Screen. This creates a P99 TAC in the OPDD segment of the SSR. For information on the MSSICS UOMA screen, see MSOM BUSSR 004.014. If an assessment was imposed, see examples of posting the assessment amount of a CMP in GN 02230.055A.3.

  2. 2. 

    Establish the debt under the name and SSN of the person the CMP was imposed on. For example, if the CMP was imposed on a representative payee for DCN of the recipient’s payments, establish the CMP on the representative payee’s own record under the representative payee’s name and SSN. Do not post the CMP on the recipient’s record.

  3. 3. 

    If an assessment is imposed and no State Supplementation is involved in the overpayment, record a P TAC for the CMP as a Federal amount only, via the MSSICS UOMA Screen.

  4. 4. 

    If an assessment is imposed and State Supplementation is involved in the overpayment, you must determine the State amount of the overpayment. If the overpayment contains State funds, use the MSSICS UOMA screen to record a State specific P TAC as a State amount for the State overpayment portion of the assessment. Use a P TAC as a Federal amount for the remainder of the CMP amount (i.e., rest of assessment amount plus the penalty amount). For examples of CMP impositions with an assessment that takes the place of an overpayment involving State Supplementation, see below. For a list of State fund codes see, SM 01301.535.

  5. 5. 

    Enter a notice date on the UOMA screen when you add the amount(s). Use the date of the final administrative or judicial action. The final action could be one of the following:

    • A signed settlement agreement by the Chief Counsel to the Inspector General;

    • OCIG demand letter imposing the CMP;

    • Health and Human Services’ (HHS) ALJ’s post-hearing decision;

    • HHS DAB’s recommended decision;

    • Commissioner decision reversing or modifying the HHS DAB’s recommended decision; or

    • U.S. Court of Appeals decision.

  6. 6. 

    Establish the recovery rate using the UOCR or UOPD screen. For information about check adjustment, see MSOM BUSSR 004.013, MSOM BUSSR 004.008, and SM 01311.125. The recovery rate could be either:

    • The negotiated rate stated in the settlement agreement; or

    • Full withholding if there is no settlement agreement. Full withholding applies because the CMP is not an overpayment, was the result of fraud or other misconduct, and is not subject to limitations on the amount SSA can withhold from current Title XVI payments to recover an overpayment.

  7. 7. 

    Add a fraud indicator. See how to post a fraud indicator in GN 02230.055A.7.

  8. 8. 

    Add Remarks on the SSR that include:

    • Amount of the CMP;

    • OPSQ number where CMP posted;

    • Any associated SSNs;

    • That the CMP is not subject to waiver or discharge in bankruptcy;

    • The overpayment was reduced because of the assessment (if applicable);

    • A remark stating not to delete the Remarks; and

    • Any additional necessary information.

  9. 9. 

    Send a notice stating that SSA plans to start withholding the person’s payment to collect the CMP debt. See the CMP withholding notice in NL 00703.963.

b. Debtor in non-pay status (other than T50/T51) for Title XVI

  1. 1. 

    Post the CMP to the SSR as a P TAC using the MSSICS UOMA Screen. This creates a P99 TAC in the OPDD segment of the SSR. For information on the MSSICS UOMA screen, see MSOM BUSSR 004.014. If an assessment was imposed, see examples of Posting the Assessment amount of a CMP in GN 02230.055A.3.

  2. 2. 

    Establish the debt under the name and SSN of the person the CMP was imposed on. For example, if the CMP was imposed on a representative payee for DCN of the recipient’s payments, establish the CMP on the representative payee’s own record under the representative payee’s name and SSN. Do not post the CMP on the recipient’s record.

  3. 3. 

    If an assessment is imposed and no State Supplementation is involved in the overpayment, record a P TAC for the CMP, as a Federal amount only, via the MSSICS UOMA Screen.

  4. 4. 

    If an assessment is imposed and State Supplementation is involved in the overpayment, you must determine the State amount of the overpayment. If the overpayment contains State funds, use the MSSICS UOMA screen to record a State specific P TAC as a State amount for the State overpayment portion of the assessment. Use a P TAC as a Federal amount for the remainder of the CMP amount (i.e., rest of assessment amount plus the penalty amount). For examples of CMP impositions with an assessment that takes the place of an overpayment involving State Supplementation, see below. For a list of State fund codes see, SM 01301.535.

  5. 5. 

    Enter a notice date on the UOMA screen when you add the amount(s). Use the date of the final administrative or judicial action. The final action could be one of the following:

    • A signed settlement agreement by the Chief Counsel to the Inspector General;

    • OCIG demand letter imposing the CMP;

    • HHS ALJ’s post-hearing decision;

    • HHS DAB’s recommended decision;

    • Commissioner decision reversing or modifying the HHS DAB’s recommended decision; or

    • U.S. Court of Appeals decision.

  6. 6. 

    Add a fraud indicator. See how to post a fraud indicator in GN 02230.055A.7.

  7. 7. 

    Add Remarks on the SSR that include:

    • Amount of the CMP;

    • OPSQ number where CMP posted;

    • Any associated SSNs;

    • That the CMP is not subject to waiver or discharge in bankruptcy;

    • The overpayment was reduced because of the assessment (if applicable);

    • A remark stating not to delete the Remarks; and

    • Any additional necessary information.

  8. 8. 

    There is no notice required for a non-pay situation.

EXAMPLE 1:CMP imposed, assessment equal to the pre-existing overpayment involving State Supplementation

CMP imposed = $1,100 ($1,000 penalty and $100 assessment)

Pre-existing overpayment = $100 ($75 Federal/$25 State Supplementation)

To delete/zero out the $100 overpayment:

  • Use a Z TAC on terminated records or records with a force pay flag (FFLF) via MSSICS UOPD Screen (MSOM BUSSR 004.008); or

  • Use an NT TAC on all other Title XVI records via MSSICS UOPD Screen (MSOM BUSSR 004.008).

Post the CMP as follows via the MSSICS UOMA Screen:

  • $1,075 Federal amount ($1,000 for the penalty and $75 for the Federal overpayment portion of the assessment). This creates a P99 TAC in the OPDD segment of the SSR.

  • $25 State amount for the State overpayment portion of the assessment. This creates a State specific P TAC in the OPDD segment of the SSR.

EXAMPLE 2: CMP imposed, assessment greater than pre-existing overpayment involving State Supplementation

CMP imposed = $1,200 ($1,000 penalty and $200 assessment)

Pre-existing overpayment = $100 ($75 Federal/$25 State Supplementation)

To delete/zero out the $100 overpayment:

  • Use a Z TAC on terminated records or records with a force pay flag (FFLF) via MSSICS UOPD Screen (MSOM BUSSR 004.008)

  • Use an NT TAC on all other Title XVI records via MSSICS UOPD Screen (MSOM BUSSR 004.008).

Post the CMP as follows via the MSSICS UOMA screen:

  • $1,175 Federal amount ($1,000 for the penalty + $100 for the amount of the assessment that is greater than the overpayment + $75 for the Federal overpayment). This creates a P99 TAC in the OPDD segment of the SSR.

  • $25 State amount for the state overpayment portion of the assessment. This creates a State specific P TAC in the OPDD segment of the SSR.

6. Establishing a ROAR record when no MBR/SSR exists

In order to have an automated record when a CMP is imposed for a person who has never been entitled to benefits (and therefore has no MBR or SSR), the debt must be established on a ROAR record. The PSC is responsible for establishing a ROAR record. The ROAR record must be established on the CMP debtor’s own SSN using BIC A. See instructions on how to establish a debt in MSOM DMS 002.003.

7. Posting a fraud indicator

Always include a fraud indicator on the record when posting a CMP.

Title II – Post a “Y” fraud indicator to ROAR on the Modify Debt Statistics (SMMD) screen when posting the CMP. For information on the SMMD screen, see MSOM DMS 002.005.

Title XVI – Although the SSR does not have a specific fraud indicator, use the UOSD screen and select “4” (Fraud) under Suspend Billing. The suspend billing code should remain indefinitely. This allows the system to recognize it is a fraud debt. For information on the UOSD screen, see MSOM BUSSR 004.006.

NOTE: The fraud indicator is the only way to prevent the debt from being billed through the Recovery and Collection of Overpayment (RECOOP) Process system and from being selected for collections via the Treasury Offset Program (TOP).

8. Posting a CMP to a record in a program other than the program in which the violation occurred – trust funding

When posting a CMP to a record in a program other than the program in which the violation occurred, manual trust fund corrections may be necessary.

EXAMPLE 1: Title XVI CMP posted to a Title II record

A CMP is imposed on a Title XVI recipient’s representative payee, and the representative payee does not have an SSR or MBR.

  • Establish a ROAR record for the representative payee;

  • Choose the SSI trust fund indicator when establishing the ROAR; and

  • Post payments received to the ROAR record.

The system automatically credits the SSI general fund with remittance amounts.

EXAMPLE 2: Title II CMP posted to a Title XVI record

A CMP is imposed on a Title II recipient’s representative payee, and the representative payee only has a Title XVI record.

  • Post the CMP to the representative payee’s Title XVI record;

  • Post payments received to the Title XVI record; and

  • Complete an SSA-666 (Adjustment in Trust Fund Accounts) for remittances SSA receives to ensure the Title II trust fund is credited properly. Do not transfer the entire CMP amount unless all payments have been received. Make the transfers on a periodic basis as payments are received (e.g., quarterly). However, you must complete all transfers of funds SSA actually received before the end of each fiscal year. For instructions on completing the SSA-666, see SM 00610.230B, steps 5 and 6.

9. PSY T50/T51 on SSR

The system does not allow overpayments to be posted to an SSR when the PSY is T50/T51. If a CMP is imposed for a Title XVI violation and the SSR PSY is T50/T51:

  • Post the CMP to the MBR, if one exists, or establish a ROAR record;

  • Establish the debt and select the SSI trust fund indicator;

  • Add DMS Remarks or a Special Message on the MBR explaining the situation; and

  • Credit any payments to the MBR or ROAR.

10. Enter Remarks on the SSR or a Special Message on the MBR and in DMS

  • Always enter information describing the CMP on the person’s own and any associated MBRs or SSRs. For Title II, also document the DMS Remarks screens (this includes when a stand-alone ROAR record is established).

  • Specify the amount of the penalty and assessment and include any information that would help clarify the CMP. For example, cross-reference SSNs that may have been involved, a representative payee situation, or the assessment has taken the place of the overpayment.

  • Annotate that the CMP is not subject either to waiver or to discharge in bankruptcy. In addition, include that these remarks should not be deleted.

EXAMPLES of Remarks entered on the SSR, MBR, or in DMS:

$5K CMP IMPOSED FOR DCN ON JOHN DOE XXX-45-XXXX FRAUD-DO NOT WAIVE OR DISCHARGE-COLLECT O/P THEN CMP-DIARY SET FOR MM/DD/YY-DO NOT DELETE REMARK (Use this remark in the relatively rare circumstance when OCIG’s settlement agreement provides for completion of collecting the overpayment before the CMP.)

$5K CMP IMPOSED FOR MISUSE POSTED ON O/P SEQ #__ -X/R TO XXX-45-XXXX, XXX–56-XXXX-DO NOT WAIVE OR DISCHARGE-DO NOT DELETE REMARK

$5K PENALTY & $1200 ASSMNT IMPOSED-FRAUD-ASSMNT SUBSUMES $700 O/P DO NOT WAIVE OR DISCHARGE DO NOT DELETE REMARK

CMP ON BANKRUPTCY PET SENT TO RCC COPY TO RO or PSC CMP CONTACT ON MM/DD/YY DO NOT DELETE REMARK

IMPORTANT: On the SSR, always include the OPSQ number of the CMP in Remarks.

11. CMP imposed against a representative payee

If the CMP is imposed against a representative payee, take the following actions in addition to posting the CMP:

  • Obtain a representative payee query of the debtor using the representative payee’s SSN. Refer to MSOM RPS 001.001.

  • Annotate the misuse determination on the RPS via the RMIS screen, if the CMP is imposed due to misuse. For information on the RMIS screen, see MSOM RPS 005.003.

  • Add a statement to the representative payee special text screen about the CMP finding; include the reason for the CMP, date imposed, program, related claim number(s), and CMP amount. For information on entering remarks in RPS, see MSOM RPS 002.020.

  • Conduct a continued suitability investigation if the representative payee is currently serving for other beneficiaries/recipients. For information on determining the need for a new representative payee, see GN 00504.100.

12. Enter Remarks on the Representative Payee System (RPS)

If a CMP is imposed on a person, who is serving or has previously served as a representative payee, enter information about the CMP on the RPS Special Text Screen (RPST), and include associated SSNs. For information on entering remarks in RPS, see MSOM RPS 002.020 and GN 00502.132B.

13. Relationship of non-legally defined overpayment (LDO) to assessment

If the overpayment resulting from the CMP debtor’s conduct is not an LDO and an assessment is imposed that represents that non-LDO, the assessment takes the place of the non-LDO. For collection purposes, treat the non-LDO like an LDO. Post the penalty and assessment according to these POMS. For information on erroneous payments that are not overpayments, see GN 02201.001.

B. CMP Case Posting Scenarios

Below are some examples of CMP case scenarios and guidance on how to post the CMP. Use this chart as a general guide to post CMPs in these scenarios. Not all CMPs fall within the listed scenarios because of the variable factors in each case. Therefore, you may need to seek additional guidance on the particular CMP case you are handling. Follow your office’s established contact procedures when seeking additional guidance.

1. CMP imposed for a Title II violation

Payment Status

Action

T2 current pay

T16 current pay

= post to T2 record and collect from T2

T2 non-pay

T16 current pay

= post to T16 record and collect from T16.

Credit T2 trust fund with payments

See GN 02230.055A.8.

T2 non-pay

T16 non-pay*

= post to T2 record

T2 non-pay

T16 NIF

= post to T2 record

T2 NIF

T16 current pay

= post to T16 record and collect from T16.

Credit T2 trust fund with payments

See GN 02230.055A.8.

T2 NIF

T16 non-pay*

= post to T16 record

T2 NIF

T16 NIF

= establish a ROAR record and post the CMP

2. CMP imposed for a Title XVI violation

Payment Status

Action

T16 current pay

T2 current pay

= post to T16 record and collect from T16

T16 non-pay*

T2 current pay

= post to T2 record and collect from T2.

Credit T16 trust fund with payments

See GN 02230.055A.8.

T16 non-pay*

T2 non-pay

= post to T16 record

T16 non-pay*

T2 NIF

= post to T16 record

T16 NIF

T2 current pay

= post to T2 record and collect from T2.

Credit T16 trust fund with payments

See GN 02230.055A.8.

T16 NIF

T2 non-pay

= post to T2 record

T16 NIF

T2 NIF

= establish a ROAR record and post the CMP.

Credit T16 trust fund with payments

See GN 02230.055A.8.

3. CMP imposed for violations in both Title II and Title XVI

A CMP can be imposed as a result of violations under both Title II and Title XVI. If an OCIG settlement agreement exists, adhere to the terms in that agreement. However, if no settlement agreement exists, follow the method in the chart below:

Payment Status

Action

T2 current pay

T16 current pay

= post to either T2 or T16 record

T2 current pay

T16 non-pay*

= post to T2 record and collect from T2

T2 current pay

T16 NIF

= post to T2 record and collect from T2

T2 non-pay

T16 current pay

= post to T16 and collect from T16

T2 non-pay

T16 non-pay*

= post to T2 record

T2 non-pay

T16 NIF

= post to T2 record

T2 NIF

T16 current pay

= post to T16 and collect from T16

T2 NIF

T16 non-pay*

= post to T16

T2 NIF

T16 NIF

= establish ROAR record and post the CMP

*IMPORTANT: If the T16 record non-pay status is PSY T50/T51, the system will not allow you to post the CMP debt. In this instance, you must post the CMP to the T2 record. If no T2 record exists, you must establish a ROAR record for the CMP.


GN 02230 TN 10 - Special Overpayment Procedures - 2/06/2019