Identification Number:
GN 00502 TN 56
Intended Audience:See Transmittal Sheet
Originating Office:ORDP OISP
Title:Determining the Need for, Developing and Selecting a Representative Payee
Type:POMS Transmittals
Program:All Programs
Link To Reference:
 

PROGRAM OPERATIONS MANUAL SYSTEM
Part GN – General
Chapter 005 – Selection of Representative Payee
Subchapter 02 – Determining the Need for, Developing and Selecting a Representative Payee
Transmittal No. 56, 07/16/2020

Audience

PSC: CA, CCRE, CS, ICDS, IES, ISRA, NPR, RECONR, SCPS, TSA, TST;
OCO-OEIO: BTE, CCRE, CR, CTE, FCR, PETL, RECONR;
OCO-ODO: BTE, CCE, CR, CST, CTE, CTE TE, DSE, LCC, PETE, PETL, RECONE;
FO/TSC: CS, CS TII, CS TXVI, CSR, CTE, DRT, FR, OA, OS, RR, TA, TSC-CSR;

Originating Component

OISP

Effective Date

Upon Receipt

Background

We reviewed and revised the capability determination instructions to improve the completion of comprehensive beneficiary capability determinations that correctly reflect whether or not a beneficiary requires a representative payee to manage his or her Social Security benefits.

 

Summary of Changes

GN 00502.001 Capability Determination and Representative Payee Payment Overview

Subsection B - We revised language in this section to provide clarification on making a capability determination.

 

GN 00502.023 Legal Evidence of Capability

Changed the section title to Developing Legal Evidence of Capability

Subsection B - We transferred the content from GN 00502.023A.2 into this section. We reorganized the steps for obtaining and documenting the court order to provide clarity.

Subsection C - We revised this section to improved clarity when a legally incompetent beneficiary requests direct payment.

Subsection D - We added this new subsection to improve clarity and user understanding for when court orders that establish legal incompetence already exist in SSA records.

Subsection E - We transferred the prior subsection B.5 into this section to improve user access and understanding for the requirements of obtaining court orders for legal incompetence if the user established incapability based on convincing evidence.

 

GN 00502.030 Lay Evidence of Capability

Changed the section title to Developing Lay Evidence of Capability.

Subsection A - We transferred the content from GN 00502.050A into this section as it pertains to lay evidence of capability and to provide easier user access. We transferred part of subsection A and A.2 regarding lay and medical evidence working together to make a capability determination into GN 00502.060C for easier user access and to improve user understanding of making a capability determinations.

Subsection B - We transferred the content from GN 00502.050A.1 into this section to remove duplication and revised this section to improve clarity for completing a lay evidence interview with a beneficiary. We transferred the EXAMPLES in this subsection to GN 00502.060C to improve user understanding and easier user access when making a capability determination.

Subsection C - We added this new subsection and transferred the content from GN 00502.050A.2 into this section to remove duplication and improve clarity on the requirements for lay evidence obtained from third-party interviews.

Subsection D - We added this new subsection to provide clarity on documenting third-party signed statements pertaining to lay evidence.

Subsection E - We transferred information from GN 00502.023A and GN 00502.023B.2 into this new subsection to improve user understanding and easier user access for the use of a court order as lay evidence when the court order does not establish legal incompetence.

 

GN 00502.040 Medical Evidence of Capability

Changed the section title to Developing Medical Evidence of Capability.

Subsection A - We added language to clarify the requirements of medical evidence referred to in this section as other forms and summary reports. We clarified the requirements for other forms and summary reports and medical evidence over one year old. We transferred the content from GN 00502.050B into this section to remove duplication and improve clarity and easier user access to medical evidence requirements.

Subsection B - We transferred some language from GN 00502.050B.2 and added new content, creating this new subsection to improve user understanding of requirements when there is no medical evidence available.

 

GN 00502.050 Developing Evidence of Capability

We archived this section and transferred the language to GN 00502.030 and GN 00502.040 to remove duplication and improve user of understanding of developing evidence of capability.

 

GN 00502.055 Reevaluating a Beneficiary's Ability to Manage Benefits

We revised language throughout this section to clarify the requirement to complete capability development and a capability determination when a user becomes aware of indicators or evidence that there is a change in a beneficiary's capability.

The content from Subsection C was transferred to subsection D.

The content from Subsection D was transferred to subsection C.

 

GN 00502.060 Making a Capability Determination

Subsection A - We revised language in this section to provide clarification on making a capability determination.

Subsection C - We transferred parts of subsection GN 00502.030A, GN 00502.030A.2, and the EXAMPLES from GN 00502.030B regarding lay and medical evidence working together to make a capability determination into this section for easier user access and to improve user understanding when making capability determinations.

 

GN 00502.001 Capability Determination and Representative Payee Payment Overview

CITATIONS:

Sections 205(j) and 1631(a)(2) of the Social Security Act
20 CFR 404.2001404.2065, 410.581 – 410.591, 416.601416.665

A. Capability determination

Capability refers to a beneficiary’s ability to manage or direct the management of their Social Security benefits. Follow this general principle regarding capability issues for adult beneficiaries:

Presume that a legally competent adult beneficiary is capable of managing, or directing someone else to manage, the benefits to which they are entitled, unless there are indicators or evidence to the contrary.

For information when there is not a presumption of capability, see GN 00502.001C.

When you suspect a beneficiary may not be capable, you must make a capability determination. When developing capability, a beneficiary, who exercises direct involvement, control, and choice in identifying, accessing, and managing services to meet their personal and other needs, is capable, and you must pay them directly. Make a finding of incapability only when it is clearly in the best interest of the beneficiary to do so, based on convincing evidence (legal, lay, and medical), using sound and reasoned judgment.

The determination that a beneficiary is incapable of managing or directing someone else to manage their benefits is one of the most important determinations you will make. This determination may deprive an individual of fiscal independence and self-determination regarding how benefits are spent. 

You must follow the instructions in GN 00502.001 through GN 00502.075 when making capability determinations.

If you determine a beneficiary is incapable, you must identify and appoint a suitable representative payee. For information on representative payee payment, see GN 00502.001B.

After the initial capability determination, you must remain alert to indications of a change in the beneficiary’s condition or circumstances that might require a new capability determination.

B. Representative payee payment

A representative payee (payee) is a third party who manages the Social Security benefits of a beneficiary who is incapable of managing or directing the management of their own benefits. The Social Security Administration (SSA) decides whether to certify payments through a payee to ensure the physical, mental, and emotional well-being of the beneficiary in a manner that both preserves dignity and protects basic rights.

Base your determination to appoint a payee on the beneficiary’s capability. Do not feel compelled to find a beneficiary incapable as a matter of convenience.

Once you determine a beneficiary is incapable and needs a payee, you must follow the instructions in subchapters GN 00502.000 through GN 00506.000 to help you identify and appoint a suitable payee. In addition, follow these guidelines:

  • To the extent possible, offer the beneficiary an early opportunity to participate in the selection process. The beneficiary may be a key source in the search for a suitable payee. The beneficiary may be able to provide you with information regarding individuals who currently assist them in day-to-day living, as well as those they trust to handle financial affairs. The Social Security Act also allows for advance designation of payees, per GN 00502.085A. For information on advance designation and instructions on how you must consider advance designees, see GN 00502.085.

  • Find an able, caring payee for any beneficiary whom you determine as incapable, considering the beneficiary’s best interests.

  • Before changing a current payee, contact the current payee, per GN 00504.100.

Attention to payee issues should not end once SSA appoints a payee or determines that a payee is not required. You must remain alert to indications of a change in the payee or beneficiary’s circumstances that may require a new capability determination or payee appointment (this may include changes in direct payment or payee payment).

NOTE: You must document your capability determination per GN 00502.065.

C. Direct payment prohibitions for beneficiaries who must have a payee appointed

SSA prohibits the following types of beneficiaries from receiving direct payments, and presumption of capability does not apply. These beneficiaries do not need capability determinations and must receive benefits through a payee:

  • Adult beneficiaries who are judged legally incompetent, follow the instructions in GN 00502.023; and

  • Children under age 15 (unless they have been legally emancipated). (For direct payment to children, 15 to 17, follow the instructions in GN 00502.070).

For beneficiaries not listed under these prohibitions, you must make a capability determination, based on convincing evidence as noted in GN 00502.001A in this section, to resolve any question regarding a beneficiary’s ability to manage or direct the management of benefits.

D. Instructions for payee issues

The following table contains instructions on capability, selection of payee, and other issues covered in other subchapters that deal with specific payee issues:

For questions about

See

Capability

GN 00502.000

  • Determine direct payment prohibitions

GN 00502.001

  • Develop capability

GN 00502.001 to GN 00502.075

Selection of Payee

GN 00502.000

  • Advance Designation of Representative Payee

GN 00502.085

  • Development of a suitable payee for an incapable beneficiary

GN 00502.100 to GN 00502.181

  • Selection of a suitable payee

GN 00502.183

Payee Notices and Appeal Rights

GN 00503.000

Suspensions for Payee Development and Other Payee Actions

GN 00504.000

Foreign Claims

GN 00505.000

Payment for Representative Payee Services

GN 00506.000

Use of Benefits

GN 00602.000

Conserved Benefits

GN 00603.000

Misuse of Benefits

GN 00604.000

Accounting/Payee Reviews

GN 00605.000

Foreign Accounting

GN 00608.000

GN 00502.023 Developing Legal Evidence of Capability

A. Legal evidence of capability

Legal evidence is required when there is an allegation that the beneficiary is legally incompetent. There must be a court order in place for finding that an individual is legally incompetent. If a court establishes that the beneficiary is incompetent, the beneficiary must receive benefits through a representative payee (payee) and no other capability development is necessary.

B. How to determine if the beneficiary is legally incompetent

Complete the following actions when there is an allegation of legal incompetence.

1. Obtain a certified copy of the current court order

You must obtain a certified copy of the current court order. Evidence of legal incompetence usually takes the form of a court order appointing a legal guardian.

IMPORTANT: For instructions on when you do not have to delay a payee appointment while waiting to obtain a court order, see GN 00502.023E.

2. Does the court order specifically include a finding of or language to indicate legal incompetence or meet the criteria for a finding of legal incompetence?

The court appointment of a legal guardian does not necessarily mean the beneficiary is legally incompetent. The court order must specifically address the beneficiary's legal competence or must contain a statement regarding the individual's ability to handle their financial affairs. If the court order does not specify legal incompetence, consult the Digest of State Guardianship Laws (see GN 00502.300) to help you determine if the court order represents a finding of legal incompetence or indicates the need for a payee. Each State synopsis provides the conditions under which the court’s order constitutes a finding of legal incompetence. Look for statements concerning the beneficiary's ability to handle their financial affairs and responsibilities. When the court order is unclear on whether or not the beneficiary is incompetent, consider calling the court for clarification (see United States Court Locator). Power of attorney makes no finding about an individual’s capability or legal competence (see GN 00502.139).

If the answer is:

3. Additional capability development required

You must:

  • Complete capability development and make a capability determination, per GN 00502.001 through GN 00502.075.

  • Treat the court order as lay evidence per GN 00502.030.

  • Scan a copy of the court order into the Non-Disability Repository for Evidentiary Documents (NDRed) under the beneficiary's claim number or eView under the Beneficiary's Own Account Number (BOAN).

  • Appoint a payee only if you determine that the beneficiary is incapable.

4. Was the court order made more than one year ago?

If:

  • no, go to GN 00502.023B.5.

  • yes, obtain evidence to show that the court order showing legal incompetence is still in effect (see GN 00301.030B.3). Contact the court to obtain this information, if needed. Once you obtain evidence the court order is still in effect, follow GN 00502.023B.5. NOTE: If the court order is not in effect and there is a new court order follow GN 00502.023B.1.

5. Additional capability development not required

You must:

  • Appoint a payee.

  • Scan a copy of the court order into the Non-Disability Repository for Evidentiary Documents (NDRed) under the beneficiary's claim number or eView under the BOAN.

  • Document legal incompetence in the electronic Representative Payee System (eRPS) per MS 07409.007 Legal Guardian Information.

C. Obtaining a new court order when a legally incompetent beneficiary requests direct payment

If a beneficiary requests direct payment of their benefits and:

  • eRPS already includes documentation on the Legal Guardian Details screen (MS 07420.011); or

  • NDRed or eView contains a copy of the court order that shows a beneficiary is legally incompetent.

You must obtain the new court order showing the beneficiary is now legally competent. If you cannot obtain such evidence, you must continue payment through a payee.

If you obtain a new court order that shows the beneficiary is now legally competent, follow the additional instructions in GN 00502.055C.

D. Making payee changes after SSA records already include documentation and a court order that a beneficiary is legally incompetent

If SSA records already include documentation and a court order that a beneficiary is legally incompetent, and you take a subsequent payee application to change the payee, you must:

  • Confirm in eRPS that the court order is in SSA records.

  • Ask the payee applicant and current payee if there has been any changes in the court order.

    • If yes, follow the instructions in GN 00502.023B.

    • If no, document the current payee application, per MS 07409.007 Legal Guardian Information, with the information already documented on the Legal Guardian Details Screen (MS 07420.011).

E. Requirement to obtain the court order after you established a beneficiary incapable based on convincing evidence

If you can establish incapability based on convincing evidence by following GN 00502.001 through GN 00502.075, do not delay a payee appointment merely to obtain a court order. However, because you have an allegation of legal incompetence, you must still:

  • Obtain the court order within 10 calendar days. Diary the case for 10 calendar days per MS 07408.007 with CRTOR for receipt of the court order.

  • After you receive the court order:

    • Document the court order details of legal incompetence in eRPS per MS 07409.007.

    • Scan a copy of the court order into the Non-Disability Repository for Evidentiary Documents (NDRed) under the beneficiary's claim number or eView under the BOAN.

GN 00502.030 Developing Lay Evidence of Capability

A. Policy for lay evidence of capability

Lay evidence of capability helps you understand how the beneficiary has been managing any benefits and other funds that have been available to them to meet daily needs (food, shelter, clothing, and medical care). Lay evidence gives you insight into a beneficiary's ability to manage or direct the management of their Social Security benefits.

Absent evidence of legal incompetence, per GN 00502.023, lay evidence must be developed and considered in every capability determination; there are no exceptions, even if medical evidence (GN 00502.040) of incapability is in file.

The examples in this section are not the only sources of lay evidence. Any other means of obtaining evidence that indicates the beneficiary's ability to manage or direct the management of benefits is acceptable.

CAUTION: Do not suspend or delay benefits while developing capability unless the beneficiary fits the specific criteria in GN 00504.105 and GN 00504.110. Determine if you must pay benefits directly to the beneficiary while resolving the capability issue by following GN 00504.105 and GN 00504.110.

1. What are some examples of lay evidence?

Some common examples of lay evidence include:

  • your observations (during a face-to-face interview) of the beneficiary's behavior, reasoning ability, how they function with others;

  • how effectively they pursue the claim;

  • a statement made by the beneficiary that they are capable or incapable of managing their benefits;

  • documentation or reports that the beneficiary has been unable to meet their basic needs in the past, despite available income;

  • signed statements from, or contacts with, third-party sources with direct knowledge of facts or circumstances regarding the beneficiary’s daily living (e.g., beneficiary's relatives, custodian, close friends, neighbors, landlord, representatives of community groups, social workers, therapists, clergy, and adult protective services workers) that describe the beneficiary's ability to manage benefits and meet daily needs;

  • the representative payee (payee) applicant's answer to question 2 on the SSA-11-BK Request to be Selected as Payee as it relates to capability (see GN 00502.115) or the similar question on the electronic Representative Payee System (eRPS) Capability screen (MS 07409.017);

  • in disability cases, the beneficiary’s answer to question 17 on the Form SSA-3373-BK Function Report-Adult– Ability to handle money;

  • a court order that does not establish legal incompetence as described in GN 00502.023. For additional guidance on using a court order as lay evidence see GN 00502.030E;

  • a DDS opinion of capability, per GN 00502.040A.8; and

  • an Administrative Law Judge's (ALJ) opinion regarding the claimant's capability when capability is not specifically set before the ALJ to decide, per GN 00502.060B.3.

REMEMBER: The beneficiary is probably capable if they can tell you the amount of money received monthly, the source of the money, the amount of rent/mortgage, or the amount spent on groceries. The beneficiary is also capable if they can direct someone else to manage their benefits.

2. How much lay evidence do I need to make a determination?

You need as much lay evidence as necessary to have a clear understanding of the beneficiary's ability to manage or direct the management of their Social Security benefits. This will vary from case to case.

B. Obtaining beneficiary lay evidence

You must complete a lay evidence interview with the beneficiary, unless the beneficiary's disability prevents them from understanding and participating in an interview. A face-to-face interview with the beneficiary is the best source for lay evidence of capability because it gives you the opportunity to observe the beneficiary's behavior, ability to reason, ability to function with others, and effectiveness with which they pursue the claim. The face-to-face interview with the beneficiary is an invaluable tool for determining capability, see GN 00502.030A.1. If a face-to-face interview is not practical, an interview can be done over the phone. Document the phone conversation with an eRPS Report of Contact, per MS 07416.002. Your findings from the beneficiary interview will be part of your capability determination and documented, per GN 00502.065.

1. Ask the following questions to gain an understanding of the beneficiary's ability to manage or direct the management of their benefits:

a. Financial management

Evidence of real-world financial performance is the most reliable basis for making a capability determination. The answers to the following questions demonstrate the beneficiary’s self-awareness and ability to address current needs, understanding of the value of money, independence, self-sufficiency, and ability to handle problems:

  • What are the most important things you spend money on?

  • What bills do you pay each month?

  • When you live on your own, what bills do you pay (rent/utilities/food/transportation)?

  • Do you pay your bills or does someone else pay them for you?

  • Do you ever forget to pay some bills?

  • If you forgot to pay a bill, what did you do about it? How did you find out about it?

  • Do you have any problems with making change?

  • Do you go to the bank? If yes, how often?

  • Do you have a bank account? If yes:

    • Is it a checking or savings account?

    • Is there anyone else named on any of your bank accounts?

    • How often do you get a statement from the bank? What do you do with the statement? Do you read and understand it?

    • Do you handle online banking transactions? If not, does someone else handle your online banking transactions?

    • Do you write checks? If not, does someone else write checks from your account for you?

    • Did you ever write a check for insufficient funds ("bounced" a check) or been charged a fee for an overdrawn account? If so, how often has this happened? Why do you think this happened? What did you do when it happened?

b. Shelter

The following questions provide essential information in determining the beneficiary’s ability to meet basic daily needs, stability in living arrangements, and existing support network:

  • In what type of housing do you live?

  • How long have you lived there?

  • If less than one year, where did you live before this residence?

  • Do you live alone? If not, who lives with you?

c. Food

The quality and nutritional value of food could be a significant clue regarding the beneficiary’s ability to meet basic daily needs. Assistance in these tasks could be significant regarding support network and independence:

  • How many meals per day do you usually eat?

  • What kind of food do you usually eat?

  • Do you go to the store to buy groceries? If not, does anyone else buy groceries for you? Who?

  • Do you decide what groceries you need to buy? If not, who decides?

  • If you go to the store to buy groceries, how do you get there?

  • What would you do if you ran out of food before your check comes?

d. Medical

The following questions could provide essential information regarding the beneficiary's ability to meet basic medical needs:

  • Do you see a doctor? If so, where do you go and how often? If not, why not?

  • Do you take medication? If yes, do you need help remembering when and how much to take?

  • How do you pay the doctor's bill or pay for medicine, which includes supplying the medical insurance to the doctor if medical insurance covers the entire bill? If you don't pay this yourself, who pays the doctor bill for you?

e. Support network

The following questions attempt to provide insight into the beneficiary's existing family, friends, acquaintances, or social service workers whom the beneficiary can count on to help:

  • Do you have any relatives who live nearby?

  • Do you have any friends or other people you can trust?

  • Do your friends or relatives help you in any way? Do you ask your friends or relatives for help when you need it?

  • Is there a community center or other group that helps you or teaches you how to budget your money and pay bills each month?

  • Do your friends or family help you figure out how to manage your benefits and other funds? If so, who?

f. Questions to evaluate a beneficiary’s thought process

The following questions could provide insight into the beneficiary's thought processes, ability to reason, or value system, and could give clues regarding a beneficiary's vulnerability to predators:

  • What things besides food do you shop for each month?

  • Do friends or family borrow money from you and not pay you back?

  • Do people borrow things you own and not give them back?

  • Have you ever lived with people that did not pay their share of the rent or other expenses?

  • If, in the last year, you lived with friends or family, did they charge you for the rent? If yes, how much?

NOTE: When the beneficiary has limited English proficiency (LEP), see Language Assistance Required GN 00203.011.

C. Obtaining third-party lay evidence

You must develop lay evidence in the form of statements from third-party sources with direct knowledge of facts or circumstances regarding how the beneficiary manages finances to meet their basic needs. Sources of such information include the beneficiary’s custodian, relatives, social workers, therapists, clergy, representatives of community service groups, adult protective services workers, friends, neighbors, and landlords. You must obtain lay evidence from a third-party source other than the payee applicant. While it is preferable you obtain a signed statement from the third-party, do not delay a capability determination merely to obtain a signature. If you obtain a signed statement from a third-party, you must store it by following GN 00502.030D.

You must use Form SSA-788 (Statement of Care and Responsibility for Beneficiary) if you contact the beneficiary's custodian and the custodian is different from the payee applicant. Scan the completed SSA-788 into the Non-Disability Repository for Evidentiary Documents (NDRed) under the beneficiary's claim number or eView under the Beneficiary's Own Account Number (BOAN).

If there is no third-party source besides the payee applicant, document your attempts of obtaining a name of a third-party on the Make Note (Beneficiary Details) screen in eRPS - MS 07415.002 or your unsuccessful attempt(s) to contact a third-party using the same process as described in GN 00502.030C.2

1. Ask the third-party the following questions to obtain specific information about the beneficiary's financial performance:

  • Do you have direct knowledge of how the beneficiary manages finances to meet basic needs? NOTE: The third-party must have direct knowledge of the beneficiary’s real world financial performance to provide a statement.

  • What is your relationship with the beneficiary (e.g., parent, spouse, other relative, friend, social worker, therapist, clergy, other)?

  • How long have you known the beneficiary? (The longer the time of acquaintance, the more information the source may have.)

  • How often do you meet or see the beneficiary (daily, weekly, monthly, quarterly, yearly)? (The more frequent meeting, the more knowledge the source has of the beneficiary.)

  • Based on your interaction with and observation of the beneficiary, do they have general knowledge of what is happening to their money (e.g. the amount they receive monthly, what bills are being paid such as rent, utilities, and food, and whether the remainder is saved)?

  • Is the beneficiary able to handle a checking/savings account? (Are you aware of any bounced checks issued by the beneficiary or recurring bank fees for overdrawing the account? If yes, why do you think it happened and what did the beneficiary do about it?)

  • Is the beneficiary able to pay bills on time? (Do they have sufficient understanding of the concept of time in order to pay bills promptly? Are you aware of any occasion a utility company cut off their utilities due to non-payment? Did they ever receive an eviction notice?)

  • Based on your observation of the beneficiary, can they successfully manage money to meet basic needs (such as food, shelter, and clothing)? Can you describe how the beneficiary is meeting daily needs?

  • Can the beneficiary direct someone else in the management of their benefits? Do you know who (if anyone) is helping or would be ideal to help the beneficiary in managing benefits?

  • Do you have any other comments or concerns about the beneficiary’s financial performance or financial management capability?

2. Documenting the third-party and their detailed statement:

  • Case established in eRPS

    A payee application is taken or will be taken, whether the application is denied or approved or there is an established beneficiary’s case in eRPS:

    On the Beneficiary Details page, using the “Add Report of Contact” link, complete the “Report of Contact Details” screen. In the “Subject” section write “CAPABILITY-THIRD-PARTY STATEMENT” before adding your details in the “Report” section (see MS 07416.002).

  • Case not established in eRPS

    Follow these procedures for all beneficiary cases not established in eRPS.

    EXAMPLE: The state Disability Determination Services (DDS) suggested there may be a possibility the beneficiary needs a payee. However, you do capability development and determine the beneficiary is capable (therefore, there is no new payee application) or the payee does not have an SSN and the beneficiary has no established case in eRPS:

    •  

      Title II or Concurrent--Complete the “Report of Contact (RPOC)” screen in Modernized Claims System (MCS). In the “Report” section, write “CAPABILITY-THIRD-PARTY STATEMENT” before adding your details (see MS MCS 008.007).

    •  

      Title XVI--Complete the “Report of Contact (DROC)” screen in Modernized Supplemental Security Income Claims System (MSSICS). In the “Report Text” section write “CAPABILITY-THIRD-PARTY STATEMENT” before adding your details (see, MS MSSICS 022.010).

If you are unable to establish a RPOC in MCS or DROC in MSSICS, use the paper Form SSA-5002 (Report of Contact) for your documentation and scan into NDRed under the beneficiary's claim number or eView under the BOAN (Retention of Paper Material, see GN 00301.322).

IMPORTANT: DDS opinion is lay evidence of capability; it is NOT a determination on capability per GN 00502.040A.8.

D. If you obtain a signed statement from a third-party

  • Scan a copy of the court order into NDRed under the beneficiary's claim number or eView under the BOAN; and

  • Note in the “Report of Contact” in eRPS, MCS, or MSSICS that a third-party signed statement used in your capability determination, per GN 00502.065, is in NDRed or eView. This includes if you obtain the SSA-788 per GN 00502.030C.

E. Court order as lay evidence

If the court order does not establish legal incompetence as described in GN 00502.023, but provides insight into the beneficiary's ability or lack of ability to manage or direct the management of benefits, use the court order as lay evidence, along with the other evidence required in your capability determination (GN 00502.030 through GN 00502.050). Weigh the information in the court order along with all the other evidence in your capability determination.

GN 00502.040 Developing Medical Evidence of Capability

A. Medical evidence of capability

Medical evidence of capability is evidence of a medical nature that sheds light on a beneficiary’s ability to manage or direct the management of benefits. When a beneficiary’s capability is questionable, you must develop for medical evidence following the instructions in this section. You must scan all medical evidence used in the capability determination into the Non-Disability Repository for Evidentiary Documents (NDRed) under the beneficiary's claim number or eView under the Beneficiary's Own Account Number (BOAN).

Although a major factor, medical evidence is not the definitive, determining factor of capability. You must evaluate medical evidence, along with lay evidence (see GN 00502.030), in order to make a sound capability determination.

1. Types of medical evidence

Medical evidence is a statement offered by a physician, psychologist, or other qualified medical practitioner (medical source), based on their evaluation, examination, or treatment of the beneficiary, which provides a meaningful assessment on the beneficiary’s ability to manage or direct the management of benefits. All medical evidence used for making the capability decision must be signed by a medical source who conducted the examination or a person authorized to sign such certifications (e.g., a medical records librarian).

The SSA-787 , Medical Source Opinion of Patient’s Capability to Manage Benefits, is the preferred vehicle for obtaining medical evidence of capability. However, you may use other forms and summary reports from the medical source instead of the SSA-787 , if:

  • It is signed and dated from the medical source (physician, psychologist or other qualified medical practitioner);

  • The medical source noted in the other form or summary report that they have knowledge of the claimant's medical condition as it relates to the beneficiary's ability to manage or direct the management of funds; and

  • Includes a basis for their assessment, e.g., observations, medical records, diagnostic tests, patient self-report, family member's report.

For instructions for medical evidence that is less than one year old, follow GN 00502.040A.2.a.

For instructions for medical evidence that is over one year old medical evidence, follow GN 00502.040A.2.b

For instructions when there is no medical evidence, follow GN 00502.040B.

NOTE: For information on using the disability listing 12.05A as medical evidence, see GN 00502.040A.9.

2. Age of medical evidence

a. Medical evidence less than one year old

In every case when capability is questionable, you must develop for the most up-to date medical evidence based on an evaluation, examination, or treatment that occurred within the last year by following GN 00502.040A.3.

b. Medical evidence over one year old

If the beneficiary has not had an evaluation, examination, or treatment by a medical source within the past year, and there is an SSA-787 , other form, or summary report that is over one year old and already in Social Security Administration (SSA) records, use this as medical evidence in your capability determination, per GN 00502.040A.11.

IMPORTANT: If an SSA-787 , other form, or summary report over one year old is used, it must meet the criteria listed in GN 00502.040A.1.

3. Obtaining medical evidence less than one year old

If the beneficiary had an evaluation, examination, or treatment by a medical source within the past year, you must obtain a signed and dated SSA-827 Authorization to Disclose Information to the Social Security Administration. You must send the SSA-787 and SSA-827 directly to the medical source to obtain medical evidence that is less than one year old. Follow instructions for completing the SSA-827 in DI 11005.055.

The beneficiary or representative (someone who can act under State law, in making decisions related to beneficiary health care) must sign the SSA-827 , or an alternative Health Insurance Portability and Accountability Act (HIPAA)-compliant authorization form, to disclose medical information. If the beneficiary refuses to sign the form, and has no representative, and there is no older evidence in SSA records, per GN 00502.040A.2.b, you must develop capability using other evidence, per GN 00502.040B.

If the beneficiary decides to undergo an evaluation, examination, or obtain treatment on their own volition, ask the beneficiary to notify SSA after the examination. Then mail a SSA-787 , and signed and dated SSA-827 , to the medical source. If the beneficiary is unwilling to undergo an evaluation, examination, or treatment, do not compel them to do so solely to obtain medical evidence of capability.

If the medical source does not mail a completed and signed SSA-787 directly to SSA, follow GN 00502.040A.4.

If you receive the SSA-787 , but you question the authenticity, follow GN 00502.040A.5.

For an unsigned SSA-787 , other form, or summary report, follow GN 00502.040A.6.

IMPORTANT: If you receive a completed and signed other form or summary report back from the medical source, i.e., not the SSA-787 , you can accept it, but only if it fits the criteria in GN 00502.040A.1.

4. Medical source does not mail the less than one year old medical evidence directly to SSA

If the medical source does not mail the completed and signed (wet signature or a rubber stamp signature) SSA-787 , other form, or summary report, directly back to SSA, you may accept the completed and signed SSA-787 , other form, or summary report, if the medical source:

  • Directly mailed or gave the completed SSA-787 , other form, or summary report with a wet signature or a rubber stamp signature to the beneficiary instead of SSA;

  • Faxed the completed SSA-787 , other form, or summary report directly to SSA; or

  • Provided a completed photocopy of the SSA-787 , other form, or summary report directly to SSA.

IMPORTANT: If you question the authenticity of the SSA-787 , other form, or summary report, follow GN 00502.040A.5.

REMINDER: If the medical evidence is not the SSA-787 , but an other form or summary report, you can only accept it if it also fits the criteria in GN 00502.040A.1.

For an unsigned SSA-787 , other form, or summary report, you must follow GN 00502.040A.6.

5. Authenticity of the less than one year old SSA-787, other form, or summary report questioned

If you question the authenticity of the SSA-787 , other form, or summary report, you must contact the medical source, or medical source’s representative, to confirm its authenticity and verify the contents; including confirmation the medical source signed it. You must document the details of contacts with medical sources as follows:

a. Case established in the electronic Representative Payee System (eRPS)

A representative payee (payee) application is taken or will be taken, whether the application is denied or approved or there is an established beneficiary’s case in eRPS:

On the Beneficiary Details page, using the “Add Report of Contact” link, complete the RPOC. In the “Subject” section, write “MEDICAL EVIDENCE CONFIRMATION” before adding your details in the “Report” section, see MS 07416.002.

b. Case not established in eRPS

Follow these procedures for all beneficiary cases not established in eRPS.

EXAMPLE: The state Disability Determination Services (DDS) suggested there may be a possibility the beneficiary needs a payee. However, you do capability development and determine the beneficiary is capable (therefore, there is no payee application) or the payee does not have an SSN and the beneficiary has no established case in eRPS:

  • Title II or Concurrent--Complete the Report of Contact (RPOC). In the “Report” section, write “MEDICAL EVIDENCE CONFIRMATION” before adding your details (see MS 03508.007).

  • Title XVI--Complete the Report of Contact (DROC). In the “Report Text” section write “MEDICAL EVIDENCE CONFIRMATION” before adding your details (see MS 04422.010).

NOTE: If you are unable to establish a RPOC in MCS or DROC in MSSICS, use the paper Form SSA-5002 (Report of Contact) for your documentation and scan into NDRed or eView.

You must:

  • Scan a copy of the SSA-5002 into the Non-Disability Repository for Evidentiary Documents (NDRed) under the beneficiary's claim number or eView under the Beneficiary's Own Account Number (BOAN); and

  • Note in your “Report of Contact” in eRPS, MCS, or MSSICS, that you scanned the medical evidence and any other paper medical evidence used in your capability determination, into NDRed or eView.

6. Unsigned less than one year old medical evidence

If you receive an unsigned SSA-787 , other form, or summary report, directly from a medical source, contact the medical source of the evidence for confirmation. If the medical source confirms providing the unsigned evidence, treat it as signed and document all pertinent facts. The confirmation may be from the medical source who provided the SSA-787 , other form, or summary report, or the medical source’s representative.

If the medical source cannot confirm providing the evidence, redevelop by sending an SSA-787 and SSA-827 to this medical source.

You must document the details of your contact with the medical source, per GN 00502.040.A.5.

7. SSA is asked to pay for medical evidence

SSA does not pay for medical evidence used solely to decide capability. If the medical source requests payment for medical evidence of capability, do not honor the request. Explain that since we will not use the evidence in deciding entitlement, SSA cannot pay for it. If the medical source refuses to provide the evidence without payment and there is no other medical evidence available per GN 00502.040A, develop capability using other evidence, per GN 00502.040B.

8. DDS provides an opinion regarding a beneficiary’s capability

In disability cases, DDS often gives an opinion regarding the beneficiary’s capability. DDS is not responsible for making capability determinations.

DDS opinion is lay evidence of capability; it is NOT a determination on capability.

DDS is responsible for providing an opinion regarding a claimant’s capability to manage their disability benefits when the field office (FO) identifies a case where it is likely that a claimant may be incapable or where DDS medical development indicates the claimant may be incapable, per DI 23001.001. While the DDS provide an opinion regarding the evidence of capability, the FO is responsible for the final determination of capability. DDS does not complete medical development solely to resolve an issue of capability, per DI 23001.005.

If you are referring your case to the DDS for a disability determination, you can request DDS assistance in obtaining medical evidence of capability by following the instructions in:

  • DI 11055.215 Resolving Representative Payee Issues;

  • DI 11005.045 Completing the SSA-3367;

  • DI 23001.001 Disability Determination Services (DDS) Capability Opinion; and

  • DI 23001.005 Disability Services (DDS) Procedures for Developing Capability.

In cases where DDS initiates capability development, the DDS enters its opinion in the remarks section of the Forms SSA-831-U3 (Disability Determination and Transmittal), SSA-832-U3 (Cessation or Continuance of Disability or Blindness Determination and Transmittal) for Title XVI, or the SSA-833-U3 (Cessation or Continuance of Disability or Blindness Determination and Transmittal) for Title II.

If the file contains a completed SSA-831-U3, SSA-832-U3, or SSA 833-U3 from the DDS with no opinion on capability, do not seek a DDS opinion on capability even if you have doubts about the beneficiary’s capability. Develop capability using other information.

If you do not need a disability determination, or if the DDS indicates on the Form SSA-831-U3 (Disability Determination and Transmittal) that capability is unresolved, contact the medical source for medical evidence of capability.

9. Disability listings and medical evidence

Disability listings appear on the SSA-831-U3, in item 23. They may be referred to in Administrative Law Judge or Appeals Council decisions. A disability allowance under disability listing 12.05A is medical evidence only of incapability and you must consider the medical evidence along with lay evidence to conduct a full capability determination. For more information on DDS procedures for developing capability, see DI 23001.005.

10. Obtaining medical evidence from the Department of Veterans Affairs (VA)

If the medical source works at a VA facility, include a signed and dated SSA-827 with your request (e.g., your request may be the SSA-787 ).

11. Weighing the medical evidence obtained in a capability determination

It is important to use good judgment to weigh the value of the medical evidence before you make a capability determination based on it. For example, a medical statement of capability from a consultative examiner or another medical source based on limited contact with the beneficiary is less convincing than a statement from the beneficiary’s own medical source.

Likewise, a medical statement based on an evaluation, examination, or treatment of more than one year ago is not as valuable as medical evidence that is less than one year ago. To arrive at a sound and well-reasoned capability determination, you must carefully evaluate the medical evidence obtained for each case, along with all other evidence (namely, lay evidence, see GN 00502.030.)

B. No medical evidence

When there is no medical evidence, document your attempt(s) to obtain medical evidence. Use the same documentation instructions as described in GN 00502.040A.5 to document your attempt(s) to secure medical evidence; however in your report, write “MEDICAL EVIDENCE ATTEMPTS” before adding your details. If there is no medical evidence, you still must develop other evidence of capability, see GN 00502.001 through GN 00502.075.

GN 00502.055 Reevaluating a Beneficiary's Capability

A. When you can reevaluate a beneficiary’s capability

It is important to remember that you can reevaluate capability regardless of past determinations. Therefore, you must always be alert to changes in circumstances that might indicate the need for a new capability determination. If you become aware of indicators or evidence that there is a change in a beneficiary's capability or when you receive a request for a new determination indicating that the prior capability determination may no longer apply, you must develop capability and make a capability determination. For information on developing capability, see GN 00502.001 through GN 00502.075.

You may become aware of potential changes in capability during contact with the beneficiary, representative payee (payee), or third party or during your normal course of business, see GN 00502.055B.

B. Situations where you may become aware of indicators or evidence that there is a change in a beneficiary's capability

  • Continuing disability reviews (CDRs), see DI 28001.015.

  • Supplemental Security Income (SSI) redeterminations (including age 18 disability redeterminations), see SI 02305.123.

  • Discovery that a beneficiary manages any other benefit(s) or income they may be receiving.

  • A beneficiary appeal to the appointment of a payee.

  • Credible referrals or reports from third-party sources regarding beneficiary’s need for assistance in managing their benefits.

  • An incapable beneficiary who requests direct payment may now be capable.

  • A capable beneficiary admitted to a mental hospital may now be incapable.

  • Notification that a new court order is in effect noting, e.g., the beneficiary is legally incompetent, a legal guardian appointment occurred, or the inability of the beneficiary to manage their financial affairs, see GN 00502.023.

  • Notification that a prior court order that noted the beneficiary was legally incompetent is no longer in effect, for example, a legally beneficiary requests direct payment as described in GN 00502.023C.

  • Any other information you become aware of that raises a question about the beneficiary's capability.

C. Direct payment to a beneficiary who currently has a payee

Before making direct payment to a beneficiary who currently has a payee, you must obtain evidence to develop for, determine, and document a new capability determination indicating the beneficiary is now capable.

1. Incapability

If the beneficiary has a payee because of a previous Social Security Administration (SSA) determination of incapability, obtain new evidence and determine if the beneficiary is now capable before initiating direct payment, see GN 00502.000.

Contact the current payee, per GN 00504.100B.1. You must document your discussion with the current payee on the proposed change of payee as follows:

  • Cases established in the electronic Representative Payee System (eRPS) (a payee application is taken or will be taken, whether the application is denied or approved):

  • On the Beneficiary Details page, using the Add Report of Contact link complete the RPOC. In the “Report” section write “CAPA-CURRENT PAYEE CONTACT” before adding your details (see MS 07416.002).

  • Cases not established in eRPS (e.g., the payee does not have an SSN):

    • Title II or Concurrent—Complete the Report of Contact (RPOC). In the “Report” section, write “CAPA-CURRENT PAYEE CONTACT” before adding your details (see MS 03508.007).

    • Title XVI—Complete the Report of Contact (DROC). In the “Report Text” section write “CAPA-CURRENT PAYEE CONTACT” before adding your details (see MS 04422.010).

      NOTE: If you are unable to establish a RPOC in MCS and MSSICS, use the paper SSA-5002 Report of Contact for your documentation and scan into NDRed or eView.

    IMPORTANT: If you determine that a previously incapable beneficiary is now capable, you may need a CDR or SSI redetermination (see DI 13001.005 and SI 02305.022). If a beneficiary is using a ticket under the Ticket to Work program, do not initiate a medical CDR (see DI 55000.000).

    EXCEPTION: If you need to make direct payment to an incapable beneficiary (i.e. who currently has a payee) because payee development is pending (see GN 00504.105), you do not need to make a new capability determination unless you believe the beneficiary is now capable. In this instance, have the beneficiary complete an SSA-11.

2. Voluntary conservator

If a voluntary conservator was appointed payee, a capability determination may not have been made before appointing the conservator as payee, per GN 00502.139B.4. Develop capability fully before deciding if direct payment is appropriate, unless the beneficiary insists on having the voluntary conservator appointed as their payee.

D. Identifying beneficiaries in need of a payee

Field Offices should establish and maintain relationships with community social service organizations to help identify beneficiaries who may need assistance in managing benefits. SSA does not have routine touch points (e.g., CDRs) with beneficiaries who receive retirement and survivors benefits. Therefore, we may not receive information through our normal business processes about beneficiaries in this population who undergo changes in their ability to manage benefits over time. FO technicians should be vigilant and proactively address capability issues in all of our beneficiary programs; this helps prevent instances of misuse and fraud. For information on SSA’s referrals to other agencies, see Types of Referral Services SSA Provides in GN 00903.100. Referrals specific to the elderly population may include Area Agencies on Aging or Long Term Care Ombudsmen.

GN 00502.060 Making a Capability Determination

A. Policy for making a capability determination

A determination that a beneficiary is incapable effectively takes away their right to decide how benefits are used. Therefore, you must carefully consider all evidence and use sound and reasoned judgment. When making a capability determination, give primary consideration to the beneficiary's best interests. Do not feel compelled to find a beneficiary incapable as a matter of convenience.

B. Guidance for making a capability determination

Besides the guidance in this section, you must also complete and document your capability determination by following GN 00502.065.

1. Who is responsible for making capability determinations?

Field Office technicians are responsible for making the final capability determination. For information on when a Workload Support Unit claims specialist may make a capability determination, see the NOTE in GN 00501.015A.1.

2. How do I make a capability determination?

Weigh all the evidence you have obtained (legal, lay, and medical) to make a capability determination. Consider the facts you have learned about the beneficiary, such as:

  • physical and mental health (including medical evidence of capability);

  • living situation (whether the beneficiary lives alone, whether any third party manages or helps the beneficiary manage financial or business affairs);

  • handling of any money now received (whether the beneficiary shows ability to make reasonable decisions about how to use money or if some third party must make those decisions); and

  • how beneficiary needs are being met (whether the beneficiary can obtain their own food, clothing and shelter or is dependent on others to supply those needs).

Based on the evidence, determine whether representative payment or direct payment would be in the beneficiary's best interests.

3. What if an Administrative Law Judge (ALJ) states in their decision that a beneficiary is incapable?

Unless capability is specifically set before the ALJ to decide, you are not bound to follow the ALJ's opinion and you must make the capability determination yourself. However, the ALJ's opinion regarding capability is lay evidence and you should evaluate it as such when making a capability determination.

4. What if the beneficiary is already entitled to benefits on another account?

Unless you have new evidence (including evidence revealed because of recent contact with the beneficiary) about the beneficiary's capability/incapability, assume the initial determination about the beneficiary's capability/incapability remains in effect for any other benefits to which the beneficiary becomes entitled.

Appoint one (i.e. the same) representative payee (payee) for all benefits to which the beneficiary is entitled (see GN 00502.183B.3).

REMEMBER: The electronic Representative Payee System (eRPS) permits you to take one payee application for all beneficiary entitlements via the Claimant Entitlement screen, see MS 07409.018.

5. How do lay evidence and medical evidence work together?

Lay evidence may support or disprove the medical evidence in a case. As the decision maker, you must carefully evaluate all lay and medical evidence when making a determination of the beneficiary's capability. Generally, lay and medical evidence will both lead you to a clear understanding of a beneficiary's ability to manage or direct the management of benefits. Sometimes, they may conflict. Nevertheless, you must evaluate both lay and medical evidence and make a capability determination based on the most convincing evidence. The following are examples of using lay evidence and medical evidence.

a. Significant medical evidence available

Mr. Green's doctor submitted a Form SSA-787 (Physician’s/Medical Officer’s Statement of Patient’s Capability to Manage Benefits) describing Mr. Green's condition and stating that Mr. Green is incapable.

Mr. Green's brother, who is also his custodian, files a payee application. Mr. Green's brother states that Mr. Green is unable to handle his own benefits because he does not know the value of money and frequently gives it away to strangers.

At the interview, Mr. Green does not seem to understand your questions and answers them incoherently.

In this case, lay evidence of capability would be your observations of Mr. Green's incoherent speech and his brother's statement that Mr. Green is unable to handle his own benefits. Both the medical and lay evidence seem to agree that Mr. Green needs a payee.

b. Medical evidence is not convincing or not available

Mr. Brown's doctor submitted a Form SSA-787 stating that Mr. Brown is incapable. However, Mr. Brown filed his own application for benefits and, to your observations, seemed able to handle his own affairs. Therefore, the medical evidence is not consistent with the lay evidence (your observations). To clarify:

  • discuss the need for a payee with Mr. Brown and obtain his statement about how he is handling his own affairs;

  • obtain statements from friends, relatives or other knowledgeable sources about how Mr. Brown functions in society and how he handles money; and

  • obtain a statement from the caseworker at the neighborhood mental health clinic (which Mr. Brown says he visits twice a week) about how Mr. Brown is functioning in the community and how he handles his money.

c. Lay evidence outweighs medical evidence

Mr. Black's doctor submitted a Form SSA-787 stating that Mr. Black is incapable. At the interview, Mr. Black understands your questions and answers them coherently.

In response to questions about how Mr. Black has been managing his finances, he tells you that he belongs to a center in his community that helps him. He is directly involved in setting up a budget, choosing the services he needs and handling his money. He says the center is a place where he exercises control and authority over how his money is spent and how his bills are paid. You obtain a statement from the caseworker at the center that confirms Mr. Black's statements.

Since the medical evidence is not consistent with the lay evidence (your observations), and because Mr. Black is directing the management of his benefits, you find Mr. Black capable.

 


GN 00502 TN 56 - Determining the Need for, Developing and Selecting a Representative Payee - 7/16/2020