When a beneficiary entitled to Supplementary Medical Insurance (SMI) receives a monthly
Social Security check, the premium is deducted from the check for each month of coverage.
In some instances, the amount of the monthly benefit may be lower than the amount
of the monthly premium. Thus, even after offsetting the monthly benefit for premium
collection purposes, a premium liability amount remains. In this situation, the Program
Service Center (PSC) will bill the beneficiary directly for the remaining liability
amount. This billing is done once a year. (See SM 00850.475.)