TN 92 (10-23)

HI 00805.180 Payment of Premium Arrearage

A. Description of notice

If the type of relief offered in a particular case requires payment of a premium arrearage to have earlier (or continuous) entitlement, the PSC or ODO notice tells the individual that the social security office will advise the individual of arrangements that may be made if the individual is unable to pay the arrearage in a lump sum. The notice does not mention installment payments, per se.

B. Policy

1. Installment payments

Installment payments are acceptable in cases where waiver of the entire arrearage is not possible. The installments may be paid directly to SSA or they may be deducted from monthly social security checks if the individual is in current pay status.

2. Who qualifies for installments

Anyone who owes a premium arrearage and states they cannot pay it in a lump sum can pay by installments. This includes those whose premium arrearage problems have been caused by Government error, but who do not qualify for waiver of a premium arrearage on hardship grounds, see HI 00805.220 B.

Also included are Civil Service annuitants who are accreted late for premium deductions from their annuity checks (as explained in HI 01001.181), but had received timely notice that their SMI coverage was in effect.

NOTE: For instructions on equitable relief for RRB annuitants, see HI 01001.367.

C. Procedure for installment payments - FO actions

If an individual inquires about the “arrangements” mentioned in the PSC or ODO notice, mention installment payments. Make it clear that installment payments are intended for those persons whose SMI coverage for a retroactive period requires payment of an arrearage, but whose financial circumstances make it difficult to pay the premium arrearage in a lump sum.

If, after receiving such information, the individual is unable to pay the arrearage in a lump sum, accept the individual’s statement without further development.

Tell the individual that the arrearage may be paid in monthly installments of at least $15 (over and above the current premium).

NOTE: The installment payments must, in large arrearage cases, be sufficient to liquidate the arrearage in 42 months.

Notify the PSC or ODO of the tentative arrangements the individual agrees to for the installment payments.

D. Procedure for default on installments - PSC or ODO actions

If an individual defaults on installment payments, notify the individual that the individual has 30 days to remit the missing installments or the period of SMI entitlement covered by the installment agreement will be deleted.

NOTE: Any Part B benefit payments made for medical services received in those months will become overpayments which may not be waived. Those installment payments that were made prior to default will be refunded to the beneficiary.

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HI 00805.180 - Payment of Premium Arrearage - 10/11/2023
Batch run: 10/11/2023