[Federal Register Volume 59, Number 131 (Monday, July 11, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-16687]


[[Page Unknown]]

[Federal Register: July 11, 1994]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Social Security Administration

 

Social Security Ruling 94-4p.; Title II of the Social Security 
Act and Title IV of the Federal Mine Safety and Health Act of 1977--
Waiver of Recovery of Overpayments--Notice of Appeal and Waiver 
Rights--Right to a Pre-Recoupment Oral Hearing Before Waiver Can Be 
Denied

AGENCY: Social Security Administration, HHS.

ACTION: Notice of Social Security Ruling.

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SUMMARY: In accordance with 20 CFR 422.406(b)(1), the Commissioner of 
Social Security gives notice of Social Security Ruling 94-4p. This 
Ruling states the Social Security Administration's longstanding policy 
of giving adequate written notice of a determination of overpayment and 
the right to contest such determination and of providing the person 
from whom we are seeking recovery with an opportunity for a face-to-
face oral hearing before we deny that person's request for waiver of 
recovery of the overpayment. This policy is based on the 1974 court 
decision in Buffington, et al. v. Weinberger, No. 734-73C2 (W.D. Wash. 
October 22, 1974), and Supreme Court decision in Califano v. Yamasaki, 
442 U.S. 682 (1979).

EFFECTIVE DATE: July 11, 1994.

FOR FURTHER INFORMATION CONTACT: Joanne K. Castello, Office of 
Regulations, Social Security Administration, 6401 Security Boulevard, 
Baltimore, MD 21235, (410) 965-1711.

SUPPLEMENTARY INFORMATION: Although we are not required to do so 
pursuant to 5 U.S.C. 552 (a)(1) and (a)(2), we are publishing this 
Social Security Ruling in accordance with 20 CFR 422.406(b)(1).
    Social Security Rulings make available to the public precedential 
decisions relating to the Federal old-age, survivors, disability, 
supplemental security income, and black lung benefits programs. Social 
Security Rulings may be based on case decisions made at all 
administrative levels of adjudication, Federal court decisions, 
Commissioner's decisions, opinions of the Office of the General 
Counsel, and other policy interpretations of the law and regulations.
    Although Social Security Rulings do not have the force and effect 
of the law or regulations, they are binding on all components of the 
Social Security Administration, in accordance with 20 CFR 
422.406(b)(1), and are to be relied upon as precedents in adjudicating 
other cases.
    If this Social Security Ruling is later superseded, modified, or 
rescinded, we will publish a notice in the Federal Register to that 
effect.

(Catalog of Federal Domestic Assistance Programs Nos. 93.802 Social 
Security--Disability Insurance; 93.803 Social Security--Retirement 
Insurance; 93.805 Social Security--Survivors Insurance; 93.906 Special 
Benefits for Disabled Coal Miners)

    Dated: July 5. 1994.
Shirley S. Chater,
Commissioner of Social Security.

Policy Interpretation Ruling--Title II of the Social Security Act and 
Title IV of the Federal Mine Safety and Health Act of 1977: Waiver of 
Recovery of Overpayments--Notice of Appeal and Waiver Rights--Right to 
a Pre-Recoupment Oral Hearing Before Waiver Can be Denied

    Purpose: To state the longstanding Social Security Administration 
(SSA) policy of:
     Giving adequate written notice of a determination of 
overpayment and the right to contest such determination and request 
waiver of recovery of the overpayment; and
     Providing the person from whom we are seeking recovery of 
an overpayment with the opportunity for a face-to-face oral hearing 
before we deny a request for waiver of recovery of the overpayment.
    The policy is based on the court decisions and orders discussed 
below.
    Citations (Authority): Section 204(a) and (b) of the Social 
Security Act, as amended, and Title IV of the Federal Mine Safety and 
Health Act of 1977; 20 CFR 404.502a, 404.506, 404.904, 410.561, 
410.561a, and 410.620.
    Pertinent History: On October 22, 1974, the U.S. District Court for 
the Western District of Washington in Buffington, et al. v. Weinberger, 
No. 734-73C2 (W.D. Wash. October 22, 1974) stopped SSA from recovering 
overpaid Social Security benefits without giving each member of the 
plaintiff class adequate written notice of the overpayment 
determination, the right to contest such determination and the right to 
a pre-recoupment hearing. Moreover, the court stopped SSA from taking 
any action to recover the overpayments before affording the class 
member the opportunity for a hearing.
    The court ordered that the written notice must include:
     A statement of the alleged overpayment, an explanation of 
the basis for the overpayment and SSA's proposed action to recover the 
overpayment;
     A statement of the individual's right to a pre-recoupment 
hearing;
     Instructions and forms for requesting a pre-recoupment 
hearing;
     An explanation that if the person did not request a pre-
recoupment hearing within 30 days of the date of mailing of the 
overpayment notice, it would be presumed that the person waived his/her 
right to the hearing and recovery of the alleged overpayment would 
begin;
     A statement of any other administrative relief available 
(i.e., reconsideration of the fact and/or amount of overpayment and 
waiver of recovery of the overpayment); and
     A statement that the local SSA office would help him/her 
to complete and submit forms for appeal.
    The court also ordered the following:
    1. SSA had to restore all benefits withheld from the named 
plaintiffs pending an opportunity for a pre-recoupment hearing. The 
person had to be given the opportunity to examine his/her claims file 
at least 5 days prior to the date of the hearing.
    2. The pre-recoupment hearing had to be conducted by an SSA 
employee who had no prior knowledge of the events leading to the 
overpayment determination and the decision to recover the overpayment. 
At the hearing the person requesting waiver had to be given the 
opportunity to:
     Personally appear, testify, and cross-examine any 
witnesses;
     Be represented by an attorney or other representative; and
     Submit documents for consideration at the hearing.
    The court, however, did not require that a transcript be made of 
the hearing.
    3. After the hearing, SSA had to issue a written decision to the 
individual (and his/her representative, if any) specifying the findings 
of fact and conclusions in support of the decision to approve or deny 
waiver and advising of the individual's right to appeal the decision.
    In accordance with the court order, SSA began to issue overpayment 
notices containing all of the aforementioned information and to offer 
pre-recoupment hearings to all class members.
    On June 20, 1979, the Supreme Court held in Califano v. Yamasaki, 
442 U.S. 682 (1979), that individuals who filed a written request for 
waiver were entitled to the opportunity for a pre-recoupment oral 
hearing, but those who requested only reconsideration were not so 
entitled. Thereafter, SSA applied its revised overpayment notice and 
pre-recoupment hearing procedures to all individuals who are determined 
to be overpaid under the title II or Black Lung programs.
    On July 31, 1981, the court in Buffington, et al. v. Schweiker, No 
734-73C2 (W.D. Wash.) required SSA to automatically schedule pre-
recoupment hearings for persons whose request for waiver of overpayment 
recovery could not be approved after initial paper review. On February 
10, 1983, the court in Buffington, et al. v. Schweiker, No 734-73C2 
(W.D. Wash.) approved procedures developed by SSA in response to the 
1981 decree whereby pre-recoupment hearings would be automatically 
scheduled provided that the scheduling would be in writing. The 
scheduling letter had to contain all the necessary information about 
the date, time, and place of the hearing; the procedure for reviewing 
the file prior to the hearing; the procedure for seeking a change in 
the scheduled date, time, or place; and all other information necessary 
to fully inform the claimant about the pre-recoupment hearing. SSA 
began to automatically schedule pre-recoupment hearings in writing in 
April 1983.
    In its order of October 19, 1987, the court in Buffington, et al. 
v. Bowen, No. 734-73C2 (W.D. Wash.) approved SSA's plan to transfer 
waiver decisionmaking authority from the processing centers to the 
field offices for Retirement and Survivors Insurance overpayments. SSA 
implemented this change in July 1988.

Policy Interpretation

Overpayment Notice

    In accordance with the court decisions, when an overpayment is 
discovered, the person is immediately notified. The notice includes:
     The overpayment amount and how and when it occurred;
     A request for full, immediate refund, unless the 
overpayment can be withheld from the next month's benefit;
     The proposed adjustment of benefits if refund is not 
received within 30 days after the date of the notice and adjustment of 
benefits is available;
     An explanation of the availability of a different rate of 
withholding when full withholding is proposed, installment payments 
when refund is requested and adjustment is not currently available, 
and/or cross-program recovery when refund is requested and the person 
is receiving another type of benefit from SSA (cross-program recovery 
is not available to residents of New York and Pennsylvania);
     An explanation of the right to request waiver of recovery 
and the automatic scheduling of a folder review and pre-recoupment 
hearing (commonly referred to as a personal conference) if a request 
for waiver cannot be approved after initial paper review;
     Instructions about the availability of forms for 
requesting reconsideration and waiver;
     An explanation that if the person does not request waiver 
or reconsideration within 30 days of the date of the overpayment 
notice, recovery of the overpayment will begin;
     An explanation of the right to request reconsideration of 
the overpayment determination;
     A statement that the local SSA office will help him/her to 
complete and submit forms for appeal; and
     An explanation that the person receiving the notice should 
notify SSA promptly if reconsideration, waiver, a lesser rate of 
withholding, repayment by installments, or cross-program adjustment is 
wanted.

Form SSA-3105

    Form SSA-3105 (Important Information About Your Appeal and Waiver 
Rights) is included with each overpayment notice. The SSA-3105 further 
explains the pre-recoupment review process and contains a tear-off form 
which the person may complete and return to SSA if he/she wants 
reconsideration and/or waiver.

Delaying Recovery of the Overpayment

    To ensure meaningful opportunity to contest the correctness of an 
overpayment determination and/or establish entitlement to waiver, the 
date on which full refund is due and, if appropriate, the date on which 
adjustment will begin must be at least 30 days after the date of the 
overpayment notice. If the individual responds within 30 days after the 
date of the overpayment notice, SSA must take action to ensure that 
benefit payments are not interrupted. If the 30-day period cannot be 
assured, SSA must postpone any proposed recoupment for a longer period. 
Anytime waiver is requested, SSA stops recovery.

Requesting Waiver

    When waiver is requested, the individual gives SSA information 
(usually on Form SSA-632-BK (Request for Waiver of Overpayment Recovery 
or Change in Repayment Rate)) to support his/her contention that he/she 
is without fault in causing the overpayment and that recovery would 
either cause financial hardship or be inequitable. That information, 
along with supporting documentation, is reviewed to determine if waiver 
can be approved.

Reviewing Waiver Request

    In Retirement and Survivors Insurance overpayments, the waiver 
request is reviewed in the field office; in Disability Insurance 
overpayments, it is reviewed in the processing center. If waiver cannot 
be approved after review of the claims folder, the person is notified 
in writing and given necessary information about the dates, times, and 
place of the folder review and personal conference; the procedure for 
reviewing the claims folder prior to the personal conference; the 
procedure for seeking a change in the scheduled dates, times, or place; 
and all other information necessary to fully inform the person about 
the personal conference. The folder review is always scheduled at least 
5 days before the personal conference.

Folder Review

    At the folder review, the person and/or the person's representative 
has the right to review the claims folder and applicable law and 
regulations with the decisionmaker or another SSA representative who is 
prepared to answer questions. The individual can get copies of any 
requested material from the claims folder or pertinent sections of the 
law or regulations.

Personal Conference

    At the personal conference, the person is given the opportunity to:
     Personally appear, testify, cross-examine any witnesses, 
and make arguments;
     Be represented by an attorney or other representative; and
     Submit documents for consideration by the decisionmaker.
    The decisionmaker:
     Tells the person that the decisionmaker was not previously 
involved in the issue under review, that the waiver decision is solely 
the decisionmaker's, and that the waiver decision is based only on the 
evidence or information presented or reviewed at the conference;
     Ascertains the role and identity of everyone present;
     Indicates whether or not the person reviewed the claims 
file;
     Explains the provisions of law and regulations applicable 
to the issue;
     Briefly summarizes the evidence already in file which will 
be considered;
     Ascertains from the person whether the information 
presented is correct and whether he/she fully understands it;
     Allows the person and the person's representative, if any, 
to present the person's case;
     Secures updated financial information, if necessary;
     Allows each witness to present information and allows the 
person and the person's representative, if any, to question the 
witness;
     Ascertains whether there is any further evidence to be 
presented;
     Reminds the person of any evidence promised by the person 
which has not been presented;
     Lets the person and the person's representative, if any, 
present any final summary or closing statement;
     Explains that a decision will be made and the person will 
be notified in writing; and
     Explains further appeal rights in the event the decision 
is adverse to the person.

Personal Conference Decision

    SSA issues a written decision to the individual (and his/her 
representative, if any) specifying the findings of fact and conclusions 
in support of the decision to approve or deny waiver and advising of 
the individual's right to appeal the decision.
    Effective Date: This Ruling is effective July 11, 1994.
    Cross References: Program Operations Manual System, Part 02, 
Chapter 022, Subchapter 01, Sections 009, 011, 021, and 023; Subchapter 
50, Sections 301, 302, 370, and 390; Subchapter 70, Sections 003-017; 
SSR 79-30c, Recovery of Overpayment--Prerecoupment Oral Hearings.

[FR Doc. 94-16687 Filed 7-8-94; 8:45 am]
BILLING CODE 4190-29-M