TN 88 (09-23)

GN 00502.159 Additional Considerations When Foster Care Agency is Involved

A. Background

Cases involving foster care are among the most sensitive the Social Security Administration (SSA) encounters. It is essential that SSA do all it can to protect the rights of children who may not be able to rely on their parents to do so.

It is extremely important that SSA follow all legal requirements, including conducting a complete investigation of the individual or organizational representative payee (payee) applicant, using the payee preference list appropriately to identify when other payee leads should be developed and providing due process to the child’s parent and/or legal guardian (see GN 00502.159B).

Foster care agencies have traditionally been among SSA’s most dependable payees; however, their appointment as payee is not automatic. You must decide each case individually and remember to consider other concerned relatives as possible payee choices.

B. Policy for selecting a representative payee when a foster care agency is involved

Each case should be decided on its own merits. Your primary concern must be that the person, agency, or organization you select as payee will best serve the interest of the child. In the absence of a parent, be sure to consider whether other concerned relatives are a better payee candidate. SSA has several policies to help you find the best possible payee.

1. Use of the payee preference list

The payee preference list, provided in GN 00502.105A, is a developmental guide designed to help you identify the best potential payee. An agency that has been appointed legal guardian for the child by the court has a much higher standing on the payee preference list than an agency that has not been appointed legal guardian because the relationship between a court appointed legal guardian and child is stronger than merely a custodial relationship. These preferences are flexible. Each payee selection is an individualized decision, and there may be instances when selecting a payee lower on the preference list might be preferable to selecting a foster care agency, even when the agency is the legal guardian.

In the case of a parent who is barred from having contact with the child or has had parental rights terminated, do not consider the parent higher than the agency on the preference list. The court decision barring the parent’s contact with the child or terminating parental rights indicates that the parent would NOT better serve the interest of the child and the parent should not be considered a potential payee.

2. Custody

When a child is removed from parental custody and the court places the child in the custody of a foster care agency, that agency has legal custody of the child. If the foster care agency places the child into a foster care or group living household, the foster care agency retains legal custody of the child, even though the agency does not have actual physical custody of the child.

3. Guardianship issues

While a child might be placed in foster care under a court order, the order does not necessarily make the agency the legal guardian of a child in foster care. The court must specifically name the agency as the legal guardian. You must carefully review the court documents to determine the legal relationship between the child and the foster care agency.

Remember, even when the agency is the legal guardian, you are not required to appoint the legal guardian as the payee (GN 00502.139). Appoint the applicant who will best serve the beneficiary.

NOTE: 

The court order should specifically identify the State or local jurisdiction as the legal guardian. The State is not automatically the legal guardian.

4. Applications and selection

Reminder: Faxed, mailed, or dropped-off Form SSA-11-BKs (Request to be Selected as Payee) require field office (FO) action. You must follow up with a face-to-face interview unless the payee applicant meets one of the exceptions listed in GN 00502.113B.

a. Foster care agency or foster parent?

Generally, the foster care agency is preferred as payee rather than the foster parent because the agency is legally responsible for the child, not the foster parent.

b. Child is voluntarily placed in foster care

In instances where the child is placed voluntarily (by the parent) under the supervision of a foster care agency, it may be in the child’s best interests to appoint the child’s parent as payee when the parent shows strong concern. Complete an SSA-788 (or equivalent information) and document the Rep Payee/Bene Relationship “Note Type” on the Make Note Screen (MS 07415.002) in the Electronic Representative Payee System (eRPS) about pertinent custody information received. After documenting the Make Note screen, the SSA-788 may be destroyed. If no eRPS record is established, the SSA-788 and accompanying documents will be maintained by SSA either in an electronic folder (if possible) or in the claims file. You can view documentation from the “Rep Payee/Bene Relationship” Note Type in the Notes section of the Application Summary page, per Application Summary in MS 07409.022, and on the Relationship Details notes, per View Notes in MS 07415.003.

c. Other potential payee sources

While the foster care agency has custody and may be legally responsible for the child, there may be other concerned relatives who would be better choices as payees. Relatives with close ties to the child might be better able to make more balanced choices regarding use of the child’s benefits.

5. Advance notice - due process

It is a legal requirement that we provide advance notice about the payee appointment to the proper person(s). The parent(s) (or legal guardian) of a child in foster care must be provided advance notice of the appointment unless their parental rights were terminated by a court. In certain situations, eRPS cannot detect that advance notice is needed; therefore, you must prepare a manual notice using the Document Processing System (DPS) (see GN 00503.100E.2.).

C. Procedure for selecting a representative payee when a foster care agency is involved

During the payee application, gather and consider all pertinent information including copies of all appropriate court documents. A certified copy is required for a court decision of legal guardianship. Photocopies are acceptable for any other documents.

1. Investigate the individual situation

When you develop a payee application for a child in foster care, exercise caution and follow proper procedures to ensure we appoint the best payee available and provide required due process. Do not automatically appoint the foster care agency as payee for a child in foster care. Gather all pertinent information and make a thoughtful and careful choice and decide each case on its own merit. Use the Rep Payee/Bene Relationship "Note Type" on the Make Note screen to document (MS 07415.002) in eRPS the following information:

  • Why was the child placed in foster care?

  • Has the court given the agency legal custody?

  • Has a court appointed the agency legal guardian?

  • Does the child have a living parent? If so, have parental rights been terminated?

  • Are there other family members who provide support and show concern for the child?

2. Use the payee preference list (GN 00502.105B)

If there is a person higher than the agency on the payee preference list, contact that person and document the reason they are or are not interested in filing as payee before appointing the agency. However, do NOT contact a parent who the court has barred from having contact with the child or who has had parental rights terminated. Review the court document to determine whether the parent is barred from having contact with the child or has had parental rights terminated.

Consider whether, in the absence of a parent, other concerned relatives are a possibility.

Document eRPS per GN 00502.185 why you selected a payee who is not the highest on the payee preference list of possible choices.

3. Determine and document custody

Follow the instructions in GN 00504.100B.6. when the child has been placed in foster care. Contact the current payee if appropriate. Develop and document all the facts of the case before you select a new payee or retain the current payee.

SSA is required by law to maintain the current residence address of our beneficiaries even when the foster care agency has legal custody of the child. When completing the Custodian screen (MS 07409.006), answer the “Do you have physical custody?” question “NO” and record the actual residence address of the child on the Claimant/Beneficiary address screen (MS 07409.015) . Remind the payee applicant they must notify SSA and provide us the new resident address each time the child moves. Enter the residence address in eRPS and if a Supplemental Security Income case, update the living arrangement and residence address on the Supplemental Security Income Record (SSR). (See GN 00501.010B.9. for custody definitions.)

If the payee applicant is unable or unwilling to provide the current residential address of the child in foster care, evaluate suitability of the applicant.

4. Guardianship

If there is an allegation of guardianship, obtain a certified copy of the court order/appointment. Use the Rep Payee/Bene Relationship “Note Type” on the Make Note screen (MS 07415.002) to document pertinent information contained in the court documents as shown in the example below:

On January 3, 2023, I reviewed the court order giving the Department of Social Services legal guardianship of John Brown. It was issued by the (name of court) on MMDDYY. It stated John was removed from their parents due to continued abuse and that parental rights have been terminated.

After documenting eRPS with the guardianship information, scan and retain the court order through NDRED using the EP or through eDIB using eView per GN 00502.300.

CAUTION: Only record information on the payee applicant "Note Type" on the Make Note screen that is specific to the representative payee applicant. Otherwise, the information may not be retrievable if there is a payee change.

5. Application and interview

During the payee interview, ensure that the foster care agency answers all pertinent questions during the payee application process via eRPS. You must ask the payee applicant whether the child has a living parent or other interested family member. If they answer “no” (or they do not know) to the parent question, review all court documents obtained, the Master Beneficiary Record (MBR)/SSR, case file. and the Other People screen (MS 07409.019) in eRPS, if available, to determine if we have any record of a parent or other family member. Any of these sources may provide potential payee leads. Pursue payee leads as appropriate to identify the most suitable payee. The foster care agency should not be automatically selected.

When interviewing the representative of the foster care agency, take the time to fully discuss their payee responsibilities (GN 00502.114) including:

  • using and saving the money for the child’s benefit;

  • filing annual accounting reports;

  • reporting changes (including adoptions and custody changes) which affect the beneficiaries’ eligibility and benefit amount;

  • record keeping; and

  • returning conserved funds.

NOTE: 

If the foster care agency is the payee, it is the foster care agency's responsibility as payee to fulfill the duties in GN 00502.114, even if the child is placed with a foster parent.

6. Selection of payee

Do not assume the parent is “not qualified” just because the child has been placed in foster care. Consider the parent’s continued interest in the child and the probability the child will return to the parent’s custody.

When a child is placed voluntarily under the supervision of a foster care agency, it may be in the child’s best interest to appoint the parent as payee. Consider the importance of maintaining the family ties between the parent and child if the parent expects to regain custody of the child soon. Corroborate the parent’s concern with the foster care agency. If you select the parent as payee, follow-up on the appointment after three months as instructed in GN 00504.185 to ensure that the parent is using benefits properly.

When the foster parent of a child who has been placed in the custody of a foster care agency files to be payee, check with the agency to determine if the agency intends to file as payee.

For all payee applications, you must document your payee selection or non-selection determination per GN 00502.185. This includes, when applicable, an explanation of why an applicant lower on the preference list is the most suitable payee.

7. Advance notice - due process issues

The parent must be provided with advance notice of the payee appointment unless parental rights have been terminated. Per GN 00503.100, use good judgment in determining whether a parent(s) should receive an advance notice. Do not assume that the parent(s) has no rights because the child is in foster care. Review the court orders and, if needed, contact the court that issued the order to determine if the parent(s) have had their parental rights terminated. If parental rights have been terminated, document the file on the Rep Payee/Bene Relationship "Note Type" and do not send the parent(s) advance notice of the payee appointment. (See GN 00503.100E.2.)

8. Adoption issues

Advise the agency to notify SSA if the child is adopted and have them provide the name and address of the adoptive parent so SSA can secure a payee application. If the agency refuses to provide the information due to privacy concerns, request that the agency notify the adoptive parent that SSA benefits are available to the child and to contact SSA. Refer to GN 00504.220 for other adoption considerations.

D. Examples

1. Example 1

A minor child is temporarily removed from their parent's home due to the child's repeated delinquent behavior and is placed with the local social agency. The social agency files an application to become payee and states the following: they have temporary custody, they have not been appointed legal guardian, the parent remains in contact with the child and continues to show strong support and interest. When you contact the parent (as required in GN 00504.100B.1.), they indicate that they want to remain payee and plan to use the benefits for the child's current needs and save a portion of the money for the child's eventual release back to them. The technician decides that the parent should remain payee because they observe that the parent shows strong concern and will serve the best interests of the child. The decision to deny the social agency's request to be payee is further supported by the payee preference list, which indicates that under normal circumstances a parent without custody who shows strong concern is higher on the list than a social agency that is not a legal guardian. The technician denies the payee application of the social agency and documents the payee non-selection determination per GN 00502.185.

2. Example 2

A minor child is removed from their parents' home because the parents have been declared unfit. The child is placed with the local social agency that files an application to become payee. The social agency states they are not the legal guardian and that there are no other interested parties. Subsequently, the child's maternal grandparent visits the FO and files a request to be the child's payee. They state that while they do not have custody, they would use the money for the child's current needs and save the balance for the child's education. In addition, the grandparent states that they visit the child on a regular basis. The FO re-contacts the social agency and confirms that the grandparent does visit and that they show strong concern for the child. After carefully considering all the facts in the case, the technician believes the grandparent would better serve the interests of the child and appoints them as payee. The technician documents the payee selection (for the grandparent) and non-selection (for the agency) determinations per GN 00502.185.

3. Example 3

A minor child is removed from their parents' home and placed with a social agency. The social agency files to be payee and states they are not legal guardian but have custody of the child and that there are no other interested individuals. When the FO contacts the current payee, who is the parent, they state they want to remain payee and will save the money for the child. When the FO re-contacts the social agency, they indicate the parent has rarely seen the child since their placement with them and that they are anticipating a long-term placement with a foster care parent. The technician is convinced that the social agency's appointment would be in the best interests of the child and decides to make the payee change and documents the payee selection determination per GN 00502.185. Since the parents maintain parental rights they must be provided with advance notice. (Since the social agency is not the legal guardian, eRPS releases the advance notice.)

E. References

GN 00501.010 – Definitions of Common Representative Payment Terms

GN 00502.105 – Payee Preference Lists

GN 00503.100 – Advance Notice

GN 00502.113 – Interviewing the Payee Applicant

GN 00502.114 – Representative Payee Responsibilities and Duties

GN 00502.139 – Additional Development/Considerations When Guardian Involved

GN 00502.185 – Documenting Payee Selections/Non-Selections and Post-Entitlement Actions in eRPS

GN 00504.100 – Determining the Need for a Successor Payee

GN 00504.185 – Follow-up on Certain Payee Appointments

GN 00504.220 – Adoption of a Child Beneficiary – Payee Actions


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GN 00502.159 - Additional Considerations When Foster Care Agency is Involved - 09/12/2023
Batch run: 09/12/2023
Rev:09/12/2023