[Federal Register Volume 61, Number 212 (Thursday, October 31, 1996)]
[Rules and Regulations]
[Pages 56126-56133]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-27707]
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SOCIAL SECURITY ADMINISTRATION
20 CFR Parts 404 and 410
RIN 0960-AD99
Overpayment Appeal and Waiver Rights
AGENCY: Social Security Administration (SSA).
ACTION: Final rules.
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SUMMARY: In these final regulations we address the rights of
individuals regarding overpayment and waiver
[[Page 56127]]
determinations in the Social Security and Black Lung benefits programs
by stating policy established as a result of a series of court
decisions, beginning with the 1974 court decision in Buffington, et al.
v. Weinberger and including the Supreme Court decision in Califano v.
Yamasaki. The effect of these final regulations is to codify these
additional rights for overpaid individuals established in these court
decisions.
EFFECTIVE DATE: These final rules are effective December 2, 1996.
FOR FURTHER INFORMATION CONTACT: Lois Berg, Legal Assistant, 3-B-1
Operations Building, 6401 Security Boulevard, Baltimore, MD 21235,
(410) 965-1713 for information about these rules. For information on
eligibility or claiming benefits, call our national toll-free number,
1-800-772-1213.
SUPPLEMENTARY INFORMATION:
Background
Section 204(b) of the Social Security Act (the Act) provides that
the Commissioner of Social Security (the Commissioner) shall not
recover an old-age, survivors, and disability insurance (OASDI)
overpayment from any individual who is without fault in causing the
overpayment if recovery from that individual would ``defeat the
purpose'' of title II of the Act or be ``against equity and good
conscience.'' Sections 205(a) and 702(a)(5) of the Act authorize the
issuance of regulations regarding our overpayment recovery policies.
Sections 411(b) and 426(a) of the Black Lung Benefits Act (30
U.S.C. 921(b) and 936(a)), authorize the Commissioner to issue
regulations to administer the provisions of the Black Lung benefits
program. The provisions for recovery of an overpayment from an
individual under the Black Lung benefits program (Part B) regulations
generally parallel the regulations of the OASDI programs.
On October 22, 1974, the U.S. District Court for the Western
District of Washington in Buffington, et al. v. Weinberger, No. 734-
73C2, stopped SSA from recovering overpaid Social Security benefits
without first giving each member of the plaintiff class adequate
written notice of the overpayment determination and the right to a pre-
recoupment hearing.
The court ordered that the written notice must include:
1. A statement of the alleged overpayment, an explanation of the
basis for the overpayment and SSA's proposed action to recover the
overpayment;
2. A statement of the individual's right to a pre-recoupment
hearing;
3. Instructions and forms for requesting a pre-recoupment hearing;
4. An explanation that if the individual 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 individual waived
his/her right to the hearing and recovery of the alleged overpayment
would begin;
5. 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
6. A statement that an SSA office would help the individual
complete and submit forms for appeal or waiver requests.
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.
2. Each individual had to be given the opportunity to examine his/
her claims file at least 5 days prior to the date of the pre-recoupment
hearing.
3. 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.
4. At the hearing, the individual had to be given the opportunity
to:
Appear personally, testify, and cross-examine any
witnesses;
Be represented by an attorney or other representative; and
Submit documents for consideration at the hearing.
The court did not require that a transcript be made of the hearing.
5. 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 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 file a written request for
waiver are entitled to the opportunity for a pre-recoupment oral
hearing, but those who request only reconsideration are not so
entitled. Thereafter, SSA applied revised overpayment notice and pre-
recoupment hearing procedures to all individuals determined to be
overpaid under the title II or Black Lung benefit programs. On July 31,
1981, the Buffington court required SSA to schedule pre-recoupment
hearings automatically for individuals whose request for waiver of
overpayment recovery could not be approved after initial paper review.
On February 10, 1983, the Buffington court approved procedures
developed by SSA in response to the 1981 decree whereby pre-recoupment
hearings would be scheduled automatically but ordered SSA to schedule
the hearings through a written notice to the claimant. The scheduling
letter had to contain the date, time and place of the hearing; the
procedure for reviewing the claims file before the hearing; the
procedure for seeking a change in the scheduled date, time, and/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. The court also
retained jurisdiction over the matter and prohibited any changes in the
overpayment procedures it had approved without prior notification of
plaintiffs' counsel and prior approval from the court.
In its order of October 19, 1987, the Buffington court approved
SSA's plan to transfer waiver decisionmaking authority for Retirement
and Survivors Insurance overpayments from the processing centers to the
field offices. SSA implemented this change in July 1988.
On April 13, 1994, the Buffington court approved a stipulation
modifying the court's injunction in this matter. Under the stipulation,
plaintiffs agreed to withdraw counsel notification and court approval
requirements for future changes to SSA overpayment policies. In return,
SSA agreed to promulgate a Social Security Ruling (SSR) and then final
regulations embodying the overpayment requirements set forth in
Yamasaki, above. SSA published the SSR on July 11, 1994 (59 FR 35378),
published proposed regulations on June 2, 1995 (60 FR 28767), and is
now publishing final regulations to fulfill its commitments under the
stipulation.
Current Regulations
Our current regulations do not address the adequate notice, face-
to-face oral hearing, or appeal step issues noted above. However, SSA
has been complying with the court orders described above through
program instructions approved by the Buffington court.
[[Page 56128]]
Regulations Changes
We are restating in regulations the policies enunciated in the
court decisions and established in our program instructions. The final
regulations provide that when an overpayment is discovered, we notify
the individual immediately. The notice includes:
1. The overpayment amount and how and when it occurred;
2. A request for full, immediate refund, unless the overpayment can
be withheld from the next month's benefit;
3. 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;
4. 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
individual is receiving another type of payment from SSA (language
about cross-program recovery is not included in notices sent to
individuals in jurisdictions where this recovery option is not
available; currently, cross-program recovery is not available to
residents of New York and Pennsylvania);
5. An explanation of the right to request waiver of adjustment or
recovery and the automatic scheduling of a file review and pre-
recoupment hearing (commonly referred to as a personal conference) if a
request for waiver cannot be approved after initial paper review;
6. An explanation of the right to request reconsideration of the
fact and/or amount of the overpayment determination;
7. Instructions about the availability of forms for requesting
reconsideration and waiver;
8. An explanation that if the individual does not request waiver or
reconsideration within 30 days of the date of the overpayment notice,
adjustment or recovery of the overpayment will begin;
9. A statement that an SSA office will help the individual complete
and submit forms for appeal or waiver requests; and
10. A statement that the individual should notify SSA promptly if
reconsideration, waiver, a lesser rate of withholding, repayment by
installments or cross-program adjustment is wanted.
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 individual may complete and return to SSA if he/she wants
reconsideration and/or waiver.
The final regulations also provide that 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. Any time waiver is requested, SSA stops
adjustment or recovery.
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.
If waiver cannot be approved after this review, the individual is
notified in writing and given the dates, times and place of the file
review and personal conference; the procedure for reviewing the claims
file prior to the personal conference; the procedure for seeking a
change in the scheduled dates, times, and/or place; and all other
information necessary to fully inform the individual about the personal
conference. The file review is always scheduled at least 5 days before
the personal conference.
At the file review, the individual and the individual's
representative have the right to review the claims file and applicable
law and regulations with the decisionmaker or another SSA
representative who is prepared to answer questions. We will provide
copies of material related to the overpayment and/or waiver from the
claims file or pertinent sections of the law or regulations that are
requested by the individual or the individual's representative.
Although the individual may be represented at the personal
conference, he/she must also be present. This requirement is consistent
with the Supreme Court's reasoning in Califano v. Yamasaki. In
Yamasaki, the court concluded that written review could not satisfy
SSA's obligation to make an accurate waiver determination because an
evaluation of fault requires an evaluation of all pertinent
circumstances, such as the recipient's intelligence, and physical and
mental condition. The court said, ``We do not see how these can be
evaluated absent personal contact between the recipient and the person
who decides his case.'' Id. at 698.
SSA will provide suitable private space for the personal
conference. However, if the individual cannot come to the conference
site for a legitimate reason (e.g., he/she is incapacitated), SSA
personnel will travel as far as necessary to conduct the conference.
At the personal conference, the individual is given the opportunity
to:
1. Appear personally, testify, cross-examine any witnesses, and
make arguments;
2. Be represented by an attorney or other representative, although
the individual must be present at the conference; and
3. Submit documents for consideration by the decisionmaker.
At the personal conference, the decisionmaker:
1. Tells the individual 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;
2. Ascertains the role and identity of everyone present;
3. Indicates whether or not the individual reviewed the claims
file;
4. Explains the provisions of law and regulations applicable to the
issue;
5. Briefly summarizes the evidence already on file which will be
considered;
6. Ascertains from the individual whether the information presented
is correct and whether he/she fully understands it;
7. Allows the individual and the individual's representative, if
any, to present the individual's case;
8. Secures updated financial information and verification, if
necessary;
9. Allows each witness to present information and allows the
individual and the individual's representative to question each
witness;
10. Ascertains whether there is any further evidence to be
presented;
11. Reminds the individual of any evidence promised by the
individual which has not been presented;
12. Lets the individual and the individual's representative, if
any, present any proposed summary or closing statement;
[[Page 56129]]
13. Explains that a decision will be made and the individual will
be notified in writing; and
14. Explains further appeal rights in the event the decision is
adverse to the individual.
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. If waiver is denied,
adjustment or recovery of the overpayment begins even if the individual
appeals.
If it appears that the waiver cannot be approved, and the
individual declines a personal conference or fails to appear for a
second scheduled personal conference, a decision regarding the waiver
will be made based on the written evidence of record. Reconsideration
is then the next step in the appeals process.
The final regulations also state that although a personal
conference decision on the waiver issue is an initial determination,
when an individual is appealing an initial determination of waiver
denial based on a personal conference, the first appeal step is an
administrative law judge (ALJ) hearing, bypassing the reconsideration
which generally follows initial determinations. We provide that the
appeal goes directly to an ALJ hearing in this situation because a
reconsideration is a review of the written evidence and would be less
comprehensive in scope than the preceding personal conference. However,
where an individual is appealing an initial determination of waiver
denial based solely on a review of the written evidence rather than a
personal conference (i.e., the individual chose to forego the personal
conference) the first appeal step is a reconsideration.
Additionally, an individual may concurrently appeal the substantive
determination that the overpayment occurred and request waiver of
recovery of the overpayment. The final regulations provide that when
the substantive determination is upheld on reconsideration and the
waiver is denied, even if it is denied solely on the basis of a review
of the written evidence, the next step in the appeal process for both
determinations is an ALJ hearing.
In addition to revising the regulations to codify the policy
established in these court decisions, we are also removing references
to title XVIII from Secs. 404.502a and 404.506. These references
address Medicare overpayment situations, which fall within the purview
of the Health Care Financing Administration (HCFA). Before HCFA became
a separate agency, SSA was responsible for both the Social Security
cash benefit program and the Medicare program. Consequently, HCFA has
historically relied on many of SSA's regulations that addressed similar
situations under titles II and XVIII of the Act. The recoupment of
overpayments has been one of these situations. However, because
differences in the two programs have increased, HCFA has determined
that modifications to the rules are necessary. As a result, HCFA is in
the process of promulgating its own regulations with regard to Medicare
overpayments. In the meantime, on September 19, 1996 (61 FR 63404),
HCFA published a final rule that incorporated the substantive content
of 20 CFR 404.502a and 404.506 into 42 CFR 405.357 and 404.358,
respectively. Therefore, we are removing the references to title XVIII
from the regulations text of these final regulations.
Comments on Notice of Proposed Rulemaking (NPRM)
On June 2, 1995, we published proposed rules in the Federal
Register at 60 FR 28767 with a 60-day comment period. We received three
letters with comments. Following are summaries of those comments and
our responses to them.
Comment: The final rules should also make comparable changes to the
title XVI overpayment/waiver regulations.
Response: Many title XVI overpayment/waiver policies are the same
as those in title II. As a result of the comments, we will begin a
separate NPRM to make conforming changes to the title XVI regulations
where the procedures are already the same. We will also evaluate the
need for any additional changes in the title XVI overpayment/waiver
procedures. If we determine additional changes are needed, we will
address them in the separate NPRM.
Comment: Additional improvements not specifically addressed in the
Buffington court order should be made to SSA's overpayment notices, and
these changes should be codified in the final rules.
Response: All of the notice requirements ordered by the court in
Buffington are addressed in the final rules. In addition, SSA has an
ongoing initiative to improve the quality of our notices, and our goal
is to examine and revise overpayment notices as necessary to meet
changing public needs. As part of this initiative, we solicited
comments from advocacy groups and made interim improvements to the
language. The National Senior Citizens Law Center and the Legal
Services for the Elderly, who were two of the commenters on the
proposed rules, were among those groups whose comments were used to
improve the notices. However, as a result of the longstanding court
injunction in Buffington which said we could not change overpayment/
waiver policy without court approval, the changes were never
implemented. Now that the injunction has been modified, we have focus-
tested the revised language and plan for further improvements.
As we work on the notices improvement initiative, we will
thoroughly consider all comments concerning the overpayment notices
that we received on the NPRM. However, any changes we adopt as a result
of these comments will be in the actual notices or in our operating
instructions, rather than in regulations. It is not appropriate for the
regulations to prescribe individual notice content at the level of
specificity advocated in the comments. Including in the regulations
overly restrictive provisions on notice content would eliminate our
flexibility in addressing other public concerns about the notices.
Comment: The regulations should explain circumstances where the
personal conference can address whether an overpayment exists, as
contrasted with whether the overpayment can be waived.
Response: The regulations do not impose restrictions on matters
that can be addressed at a personal conference. If SSA employees have
any confusion on this point, clarification through program instructions
would be a more appropriate remedy.
Comment: If the claimant does not clearly indicate which option he
or she wishes to pursue, it will be presumed that the claimant wishes
to challenge the overpayment.
Response: Adopting this comment could disadvantage the claimant. If
the presumption is that only the fact of overpayment is being
challenged (i.e., a request for reconsideration of the overpayment
determination), recovery efforts stop until a reconsideration
determination is made. If the determination is unfavorable to the
claimant, recovery efforts resume, even if the person appeals that
determination. When only reconsideration is requested, there is no
right to a personal conference with recovery delayed until the
determination is made. That right only attaches to a waiver request.
Comment: The regulations should state that SSA will refund all
withheld benefits if waiver is approved.
[[Page 56130]]
Response: SSA policy is to pay any improperly withheld benefits if
waiver is approved. However, this does not mean full repayment is
proper every time waiver is approved. For example, waiver may be denied
because, although the person was without fault in causing the
overpayment, recovery would not cause financial hardship. Recovery
begins. Subsequently, the person's financial situation changes for the
worse and waiver is again requested. Waiver is approved effective with
the date we determine the financial situation changed. Monies withheld
before that date were withheld properly and will not be repaid. SSA
policy also requires stopping recovery as of the month waiver is
requested. If SSA does not stop recovery timely, any money withheld as
of the date of the waiver request will be paid back.
Comment: The regulations should provide for the record of the
personal conference to be made available to the claimant.
Response: As stated in Secs. 404.506(d) and 410.561a(d), the
claimant has the right to review the claims file before the personal
conference. However, no transcript is made of the personal conference,
and no court has required one. The person is given a written record in
the form of the waiver determination. The new regulations at
Secs. 404.506(g) and 410.561a(g) provide that the written decision will
include findings of fact and conclusions in support of the decision.
Current program instructions explain that this determination will
specify all the evidence considered and the rationale for the
determination reached. This rationale must include any rebuttal of the
person's arguments. We believe the regulations, as drafted, along with
these program instructions provide sufficient safeguards while
retaining adequate agency flexibility.
Comment: The regulations should explain that any adjustment or
recovery that occurs before issuance of the notice of overpayment, or
after a claimant requests waiver or appeals the overpayment notice,
will be refunded promptly to the claimant.
Response: SSA does not begin overpayment adjustment or recovery
efforts until at least 30 days after the overpayment notice is sent.
However, we do have the right to refigure the overpayment amount before
we issue the overpayment notice. This policy was upheld in the Supreme
Court decision in Everhart, et al. v. Sullivan, 494 U.S. 83 (1990). If,
through error, benefits are improperly withheld, SSA policy is to pay
the benefits. To reemphasize this policy to all field employees who
deal with the overpayment and waiver processes, we will be sure that
program instructions clearly state that the money should be paid
promptly. However, we do not believe that it is appropriate to put this
in the regulations.
Comment: The regulations should mention the right of claimants to
subpoena witnesses at a personal conference or, if they need to,
escalate a matter to the administrative hearing level.
Response: Claimants may have witnesses testify at the personal
conference. If it becomes necessary to subpoena witnesses, SSA
procedures provide for escalating the matter to an ALJ hearing. We are
not changing the regulations to reflect this at this time because we
are looking into the feasibility of giving subpoena power to the
personal conference decisionmaker in the field office.
Comment: The regulations should mention SSA's policy to permit a
claimant to request waiver and appeal of the overpayment concurrently
or in any sequence.
Response: The commenter indicated that the policy should be stated
in the regulations because ``many agency employees appear to believe
that it is necessary for an overpayment appeal to be fully resolved
before any request for waiver can be processed or adjudicated.'' We do
not agree that ``many agency employees'' are confused about this
policy, which is currently in program instructions (section GN
02201.011 of the Program Operations Manual System (POMS)). However, we
will reemphasize this policy to all field employees who deal with the
overpayment and waiver processes the next time we issue this chapter of
the POMS or sooner, if necessary.
The following comments concern matters outside the scope of, and
therefore are not addressed in, these final regulations.
1. The regulations should clarify the relationship between the 30-
day rule, 60-day rule, and 10-day rule concerning overpayments.
2. The regulations should mention the claimants' right to receive
notice of the opportunity to decline cross-program recovery. (We note,
however, that this principle is already established at 20 C.F.R.
416.570.)
3. The regulations should explain how representative payees will be
treated.
4. The regulations should explain claimants' rights with respect to
underpayments and netted overpayments.
For the reasons discussed above, we have not changed the text of
the proposed rules to reflect the public comments. We have, however,
revised the introductory paragraph in Sec. 410.561, as shown in the
proposed rules, to add a phrase which is currently in that section of
the regulations and which was inadvertently omitted from the proposed
rules. Section 410.561 will then agree with Sec. 404.502a, which is a
corresponding section of the regulations. With this one exception, we
are publishing the proposed regulations unchanged as final regulations.
Regulatory Procedures
Executive Order 12866
We have consulted with the Office of Management and Budget (OMB)
and determined that these final regulations do not meet the criteria
for a significant regulatory action under Executive Order 12866. Thus,
they were not subject to OMB review.
Paperwork Reduction Act of 1980
These final regulations impose no new reporting or recordkeeping
requirements which are subject to review by OMB.
Regulatory Flexibility Act
We certify that these final regulations will not have a significant
economic impact on a substantial number of small entities because they
affect only individuals. Therefore, a regulatory flexibility analysis
as provided in Public Law 96-354, the Regulatory Flexibility Act, is
not required.
(Catalog of Federal Domestic Assistance: Program Nos. 96.001, Social
Security--Disability Insurance; 96.002, Social Security--Retirement
Insurance; 96.003, Social Security--Special Benefits for Persons
Aged 72 and Over; 96.004, Social Security--Survivors Insurance; and
96.005, Special Benefits for Disabled Coal Miners)
List of Subjects
20 CFR Part 404
Administrative practice and procedure; Death benefits; Old-Age,
Survivors, and Disability Insurance; Reporting and recordkeeping
requirements.
20 CFR Part 410
Administrative practice and procedure; Black lung benefits; Death
benefits; Disability benefits; Miners; Reporting and recordkeeping
requirements.
Dated: October 8, 1996.
Shirley S. Chater,
Commissioner of Social Security.
For the reasons set out in the preamble, parts 404 and 410 of
chapter
[[Page 56131]]
III of title 20 of the Code of Federal Regulations are amended as
follows.
PART 404--FEDERAL OLD-AGE, SURVIVORS AND DISABILITY INSURANCE
(1950- )
Subpart F--[Amended]
1. The authority citation for subpart F of part 404 continues to
read as follows:
Authority: Secs. 204(a)-(d), 205(a), and 702(a)(5) of the Social
Security Act (42 U.S.C. 404(a)-(d), 405(a), and 902(a)(5)); 31
U.S.C. 3720A.
2. Section 404.502a is revised to read as follows:
Sec. 404.502a Notice of right to waiver consideration.
Whenever an initial determination is made that more than the
correct amount of payment has been made, and we seek adjustment or
recovery of the overpayment, the individual from whom we are seeking
adjustment or recovery is immediately notified. The notice includes:
(a) The overpayment amount and how and when it occurred;
(b) A request for full, immediate refund, unless the overpayment
can be withheld from the next month's benefit;
(c) 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;
(d) 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
individual is receiving another type of payment from SSA (language
about cross-program recovery is not included in notices sent to
individuals in jurisdictions where this recovery option is not
available);
(e) An explanation of the right to request waiver of adjustment or
recovery and the automatic scheduling of a file review and pre-
recoupment hearing (commonly referred to as a personal conference) if a
request for waiver cannot be approved after initial paper review;
(f) An explanation of the right to request reconsideration of the
fact and/or amount of the overpayment determination;
(g) Instructions about the availability of forms for requesting
reconsideration and waiver;
(h) An explanation that if the individual does not request waiver
or reconsideration within 30 days of the date of the overpayment
notice, adjustment or recovery of the overpayment will begin;
(i) A statement that an SSA office will help the individual
complete and submit forms for appeal or waiver requests; and
(j) A statement that the individual receiving the notice should
notify SSA promptly if reconsideration, waiver, a lesser rate of
withholding, repayment by installments or cross-program adjustment is
wanted.
3. Section 404.506 is revised to read as follows:
Sec. 404.506 When waiver may be applied and how to process the
request.
(a) Section 204(b) of the Act provides that there shall be no
adjustment or recovery in any case where an overpayment under title II
has been made to an individual who is without fault if adjustment or
recovery would either defeat the purpose of title II of the Act, or be
against equity and good conscience.
(b) If an individual requests waiver of adjustment or recovery of a
title II overpayment within 30 days after receiving a notice of
overpayment that contains the information in Sec. 404.502a, no
adjustment or recovery action will be taken until after the initial
waiver determination is made. If the individual requests waiver more
than 30 days after receiving the notice of overpayment, SSA will stop
any adjustment or recovery actions until after the initial waiver
determination is made.
(c) When waiver is requested, the individual gives SSA information
to support his/her contention that he/she is without fault in causing
the overpayment (see Sec. 404.507) and that adjustment or recovery
would either defeat the purpose of title II of the Act (see
Sec. 404.508) or be against equity and good conscience (see
Sec. 404.509). That information, along with supporting documentation,
is reviewed to determine if waiver can be approved. If waiver cannot be
approved after this review, the individual is notified in writing and
given the dates, times and place of the file review and personal
conference; the procedure for reviewing the claims file prior to the
personal conference; the procedure for seeking a change in the
scheduled dates, times, and/or place; and all other information
necessary to fully inform the individual about the personal conference.
The file review is always scheduled at least 5 days before the personal
conference.
(d) At the file review, the individual and the individual's
representative have the right to review the claims file and applicable
law and regulations with the decisionmaker or another SSA
representative who is prepared to answer questions. We will provide
copies of material related to the overpayment and/or waiver from the
claims file or pertinent sections of the law or regulations that are
requested by the individual or the individual's representative.
(e) At the personal conference, the individual is given the
opportunity to:
(1) Appear personally, testify, cross-examine any witnesses, and
make arguments;
(2) Be represented by an attorney or other representative (see
Sec. 404.1700), although the individual must be present at the
conference; and
(3) Submit documents for consideration by the decisionmaker.
(f) At the personal conference, the decisionmaker:
(1) Tells the individual 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;
(2) Ascertains the role and identity of everyone present;
(3) Indicates whether or not the individual reviewed the claims
file;
(4) Explains the provisions of law and regulations applicable to
the issue;
(5) Briefly summarizes the evidence already in file which will be
considered;
(6) Ascertains from the individual whether the information
presented is correct and whether he/she fully understands it;
(7) Allows the individual and the individual's representative, if
any, to present the individual's case;
(8) Secures updated financial information and verification, if
necessary;
(9) Allows each witness to present information and allows the
individual and the individual's representative to question each
witness;
(10) Ascertains whether there is any further evidence to be
presented;
(11) Reminds the individual of any evidence promised by the
individual which has not been presented;
(12) Lets the individual and the individual's representative, if
any, present any proposed summary or closing statement;
(13) Explains that a decision will be made and the individual will
be notified in writing; and
(14) Explains repayment options and further appeal rights in the
event the decision is adverse to the individual.
(g) SSA issues a written decision to the individual (and his/her
representative, if any) specifying the
[[Page 56132]]
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. If waiver is denied, adjustment or recovery of the
overpayment begins even if the individual appeals.
(h) If it appears that the waiver cannot be approved, and the
individual declines a personal conference or fails to appear for a
second scheduled personal conference, a decision regarding the waiver
will be made based on the written evidence of record. Reconsideration
is then the next step in the appeals process (but see
Sec. 404.930(a)(7)).
Subpart J--[Amended]
4. The authority citation for subpart J of part 404 continues to
read as follows:
Authority: Secs. 201(j), 205(a), (b), (d)-(h), and (j), 221,
225, and 702(a)(5) of the Social Security Act (42 U.S.C. 401(j),
405(a), (b), (d)-(h), and (j), 421, 425, and 902(a)(5)); 31 U.S.C.
3720A; sec. 5, Pub. L. 97-455, 96 Stat. 2500 (42 U.S.C. 405 note);
secs. 5, 6(c)-(e) and 15, Pub. L. 98-460, 98 Stat. 1802 (42 U.S.C.
421 note).
5. Section 404.907 is revised to read as follows:
Sec. 404.907 Reconsideration--general.
If you are dissatisfied with the initial determination,
reconsideration is the first step in the administrative review process
that we provide, except that we provide the opportunity for a hearing
before an administrative law judge as the first step for those
situations described in Sec. 404.930(a)(6) and (a)(7), where you appeal
an initial determination denying your request for waiver of adjustment
or recovery of an overpayment (see Sec. 404.506). If you are
dissatisfied with our reconsidered determination, you may request a
hearing before an administrative law judge.
6. Section 404.930 is amended by removing the word ``or'' at the
end of (a)(4) and the period at the end of (a)(5) and adding a
semicolon in its place and adding (a)(6) and (a)(7) as follows:
Sec. 404.930 Availability of a hearing before an administrative law
judge.
(a) * * *
(6) An initial determination denying waiver of adjustment or
recovery of an overpayment based on a personal conference (see
Sec. 404.506); or
(7) An initial determination denying waiver of adjustment or
recovery of an overpayment based on a review of the written evidence of
record (see Sec. 404.506), and the determination was made concurrent
with, or subsequent to, our reconsideration determination regarding the
underlying overpayment but before an administrative law judge holds a
hearing.
* * * * *
PART 410--FEDERAL COAL MINE HEALTH AND SAFETY ACT OF 1969, TITLE
IV--BLACK LUNG BENEFITS (1969- )
Subpart E--[Amended]
7. The authority citation for subpart E of part 410 is revised to
read as follows:
Authority: Secs. 411(a), 412(a) and (b), 413(b), 426(a), and 508
of the Federal Coal Mine Health and Safety Act of 1977, as amended
(30 U.S.C. 921(a), 922(a) and (b), 923(b), 936(a), and 957).
Section 410.565 also issued under 31 U.S.C. 952.
8. Section 410.561 is revised to read as follows:
Sec. 410.561 Notice of right to waiver consideration.
Whenever an initial determination is made that more than the
correct amount of payment has been made, and we seek adjustment or
recovery of the overpayment, the individual from whom we are seeking
adjustment or recovery is immediately notified. The notice includes:
(a) The overpayment amount and how and when it occurred;
(b) A request for full, immediate refund, unless the overpayment
can be withheld from the next month's benefit;
(c) 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;
(d) 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
individual is receiving another type of payment from SSA (language
about cross-program recovery is not included in notices sent to
individuals in jurisdictions where this recovery option is not
available);
(e) An explanation of the right to request waiver of adjustment or
recovery and the automatic scheduling of a file review and pre-
recoupment hearing (commonly referred to as a personal conference) if a
request for waiver cannot be approved after initial paper review;
(f) An explanation of the right to request reconsideration of the
fact and/or amount of the overpayment determination;
(g) Instructions about the availability of forms for requesting
reconsideration and waiver;
(h) An explanation that if the individual does not request waiver
or reconsideration within 30 days of the date of the overpayment
notice, adjustment or recovery of the overpayment will begin;
(i) A statement that an SSA office will help the individual
complete and submit forms for appeal or waiver requests; and
(j) A statement that the individual receiving the notice should
notify SSA promptly if reconsideration, waiver, a lesser rate of
withholding, repayment by installments or cross-program adjustment is
wanted.
9. Section 410.561a is revised to read as follows:
Sec. 410.561a When waiver may be applied and how to process the
request.
(a) There shall be no adjustment or recovery in any case where an
overpayment under part B of title IV of the Act has been made to an
individual who is without fault if adjustment or recovery would either
defeat the purpose of title IV of the Act, or be against equity and
good conscience.
(b) If an individual requests waiver of adjustment or recovery of
an overpayment made under Part B of title IV within 30 days after
receiving a notice of overpayment that contains the information in
Sec. 410.561, no adjustment or recovery action will be taken until
after the initial waiver determination is made. If the individual
requests waiver more than 30 days after receiving the notice of
overpayment, SSA will stop any adjustment or recovery actions until
after the initial waiver determination is made.
(c) When waiver is requested, the individual gives SSA information
to support his/her contention that he/she is without fault in causing
the overpayment (see Sec. 410.561b), and that adjustment or recovery
would either defeat the purposes of this subpart (see Sec. 410.561c) or
be against equity and good conscience (see Sec. 410.561d). That
information, along with supporting documentation, is reviewed to
determine if waiver can be approved. If waiver cannot be approved after
this review, the individual is notified in writing and given the dates,
times and place of the file review and personal conference; the
procedure for reviewing the claims file prior to the personal
conference; the procedure for seeking a change in the scheduled dates,
times, and/or place; and all other information necessary to fully
inform the individual about the personal conference. The file
[[Page 56133]]
review is always scheduled at least 5 days before the personal
conference.
(d) At the file review, the individual and the individual's
representative have the right to review the claims file and applicable
law and regulations with the decisionmaker or another SSA
representative who is prepared to answer questions. We will provide
copies of material related to the overpayment and/or waiver from the
claims file or pertinent sections of the law or regulations that are
requested by the individual or the individual's representative.
(e) At the personal conference, the individual is given the
opportunity to:
(1) Appear personally, testify, cross-examine any witnesses, and
make arguments;
(2) Be represented by an attorney or other representative (see
Sec. 410.684), although the individual must be present at the
conference; and
(3) Submit documents for consideration by the decisionmaker.
(f) At the personal conference, the decisionmaker:
(1) Tells the individual 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;
(2) Ascertains the role and identity of everyone present;
(3) Indicates whether or not the individual reviewed the claims
file;
(4) Explains the provisions of law and regulations applicable to
the issue;
(5) Briefly summarizes the evidence already in file which will be
considered;
(6) Ascertains from the individual whether the information
presented is correct and whether he/she fully understands it;
(7) Allows the individual and the individual's representative, if
any, to present the individual's case;
(8) Secures updated financial information and verification, if
necessary;
(9) Allows each witness to present information and allows the
individual and the individual's representative to question each
witness;
(10) Ascertains whether there is any further evidence to be
presented;
(11) Reminds the individual of any evidence promised by the
individual which has not been presented;
(12) Lets the individual and the individual's representative, if
any, present any proposed summary or closing statement;
(13) Explains that a decision will be made and the individual will
be notified in writing; and
(14) Explains repayment options and further appeal rights in the
event the decision is adverse to the individual.
(g) 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. If waiver is denied,
adjustment or recovery of the overpayment begins even if the individual
appeals.
(h) If it appears that the waiver cannot be approved, and the
individual declines a personal conference or fails to appear for a
second scheduled personal conference, a decision regarding the waiver
will be made based on the written evidence of record. Reconsideration
is then the next step in the appeals process (but see Sec. 410.630(c)).
Subpart F--[Amended]
10. The authority citation for subpart F of part 410 is revised to
read as follows:
Authority: Secs. 413(b), 426(a), 507, and 508 of the Federal
Coal Mine Health and Safety Act of 1977, as amended (30 U.S.C.
923(b), 936(a), 956, and 957).
11. Section 410.623 is revised to read as follows:
Sec. 410.623 Reconsideration; right to reconsideration.
(a) We shall reconsider an initial determination if a written
request for reconsideration is filed, as provided in Sec. 410.624, by
or for the party to the initial determination (see Sec. 410.610). We
shall also reconsider an initial determination if a written request for
reconsideration is filed, as provided in Sec. 410.624, by an individual
as a widow, child, parent, brother, sister, or representative of a
decedent's estate, who makes a showing in writing that his or her
rights with respect to benefits may be prejudiced by such
determination.
(b) Reconsideration is the first step in the administrative review
process that we provide for an individual dissatisfied with the initial
determination, except that we provide the opportunity for a hearing
before an administrative law judge as the first step for those
situations described in Sec. 410.630(b) and (c), where an individual
appeals an initial determination denying waiver of adjustment or
recovery of an overpayment (see Sec. 410.561a).
12. Section 410.630 is revised to read as follows:
Sec. 410.630 Hearing; right to hearing.
An individual referred to in Secs. 410.632 or 410.633 who has filed
a written request for a hearing under the provisions in Sec. 410.631
has a right to a hearing if:
(a) An initial determination and reconsideration of the
determination have been made by the Social Security Administration
concerning a matter designated in Sec. 410.610;
(b) An initial determination denying waiver of adjustment of
recovery of an overpayment based on a personal conference has been made
by the Social Security Administration (see Sec. 410.561a); or
(c) An initial determination denying waiver of adjustment or
recovery of an overpayment based on a review of the written evidence of
record has been made by the Social Security Administration (see
Sec. 410.561a) and the determination was made concurrent with, or
subsequent to, our reconsideration determination regarding the
underlying overpayment but before an administrative law judge holds a
hearing.
[FR Doc. 96-27707 Filed 10-30-96; 8:45 am]
BILLING CODE 4190-29-P