SSA is not required to authorize a fee when a third-party entity (see Hearings, Appeals and Litigation Law (HALLEX) manual HA 01120.002 E) or a Federal, state, county, or city government agency pays the representative's fees and expenses from its own funds and both of the following conditions apply:

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  The claimant and any auxiliary beneficiary or eligible spouse are not liable to pay a fee, expenses, or any part thereof, directly or indirectly, to the representative or someone else; and

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  The representative submits to SSA a written statement that waives the right to charge and collect a fee and any expenses from the claimant and any auxiliary beneficiary or eligible spouse, directly or indirectly, in whole or in part. For information about fee waivers, refer to HALLEX HA 01120.010.

SSA is not required to authorize the amount of out-of-pocket expenses charged to a claimant. Out-of-pocket expenses are expenses incurred in connection with the representation (e.g., the cost of obtaining copies of doctor or hospital reports and a birth or death certificate).

These expenses are matters between the representative and the claimant. However, SSA will question out-of-pocket expenses if it appears that the representative is attempting to circumvent SSA's fee authorization process by designating their services as an out-of-pocket expense (e.g., by listing expenses such as obtaining medical records as services in a fee petition).

Proceedings before state or Federal courts (even state court actions to establish relationship or death) are not proceedings before SSA; therefore, the fee authorization provisions do not apply. For information regarding court attorneys' fees for representation in proceedings before a court, see Program Operations Manual System GN 03920.060.

A legal guardian, committee, conservator, or other court-appointed representative (legal guardian) may ask a court to approve a fee for services provided in connection with proceedings before SSA. If the court orders a fee, SSA's fee authorization is not required.

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  If a legal guardian asks SSA for information regarding fees, SSA will advise them first to ask the court to approve a fee for all services, including those provided in connection with proceedings before SSA.

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  If a legal guardian files a fee petition, SSA must inform the legal guardian that SSA will not act on the fee request until the court has acted.

The fee agreement process cannot be used for fee authorization in cases where the claimant is entitled only to hospital insurance benefits and not cash benefits because there are no “past-due benefits” from which to calculate a representative's fee. A successful appeal of a claim for entitlement to hospital insurance benefits results only in a decision to enroll the claimant in the hospital insurance program without paying a premium, also known as “Medicare Part A.” In this situation, the representative may file a fee petition.

SSA uses the procedures in 20 CFR 404.1725 and 416.1525 to approve a fee petition filed by a hospital insurance-only beneficiary's representative. However, because there are no “past-due benefits” in such cases, direct payment of the authorized fee is not available. Accordingly, a hospital insurance beneficiary's representative may only collect a fee directly from the hospital insurance beneficiary.