Example 1: Mr. Johnson files for SSI aged benefits on 7/5/00. He lives in his brother's household
in a State that does not pay a federally administered State supplement. He transferred
a resource on 5/15/00 and the uncompensated value will result in a period of ineligibility
of 14 months (6/00-7/01). Mr. Johnson alleges that not getting SSI benefits would
cause him undue hardship. Mr. Johnson's SSI application indicates that his only monthly
income is ISM valued at $170.66 (the VTR). His only liquid resource is a savings account
with a 7/1/00 balance of $1,200. The claims representative (CR) adds Mr. Johnson's
income and resources ($170.66 + $1,200 = $1370.66).
Because his total available funds ($1,370.66) exceed the FBR ($512), Mr. Johnson does
not meet the undue hardship test for 7/00. The CR inquires about Mr. Johnson's expected
expenditures and Mr. Johnson alleges that he is not likely to spend enough of his
savings in 7/00-9/00 to be within the limit for undue hardship. Therefore, since Mr.
Johnson will not meet the requirements for undue hardship in the filing month or the
following 2 months, the CR denies the claim and issues a manual denial notice on 7/12/00.
Example 2: This example uses the same case facts as Example 1. Mr. Johnson returns to the field
office on 9/4/00 and files a reconsideration alleging that he has spent $1,000 of
his savings in 8/00 to pay bills. The CR documents the spend down per SI 01150.007 and determines that on 9/1/00 Mr. Johnson's bank account balance was $200. For 9/00
his total available funds are $370.66 ($170.66 ISM + $200 savings). His total available
funds are less than the FBR ($512).
The CR documents the file with Mr. Johnson's allegation that he will not be able to
pay for his food and shelter in 9/00 and in future months without SSI. The CR determines
that Mr. Johnson qualifies for benefits based on undue hardship for 9/00, and will
continue to be eligible based on undue hardship for at least the next 6 months. On
9/7/00, the CR effectuates payments for Mr. Johnson starting in 10/00 (9/00 is the
E02 month). The CR also diaries the case for 6 months to recontact Mr. Johnson to
determine if he still qualifies for benefits based on undue hardship.