[Federal Register Volume 70, Number 136 (Monday, July 18, 2005)]
[Notices]
[Pages 41250-41252]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-14138]


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SOCIAL SECURITY ADMINISTRATION


Demonstration Project on Direct Payment of Fees to Non-Attorney 
Representatives

AGENCY: Social Security Administration (SSA).

ACTION: Notice.

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SUMMARY: This notice provides information about the continuing 
education requirement that non-attorney representatives must satisfy to 
participate in the 5-year demonstration project on direct payment of 
fees to non-attorneys under section 303 of the Social Security 
Protection Act of 2004 (SSPA). The notice also announces that we have 
lowered the liability insurance requirements for participants and 
determined that applicants will be given an opportunity to correct 
defects in their applications to participate in the demonstration 
project, in certain circumstances; to protest a denial of their 
applications for any reason; and, where warranted, to have their paid 
application fee refunded or applied to satisfy the fee requirement for 
a subsequent application. The notice also clarifies the requirement 
regarding experience in representing claimants before SSA.

FOR FURTHER INFORMATION CONTACT: Michael Zambonato, Social Security 
Administration, Office of Income Security Programs, 1450 RRCC, 6401 
Security Boulevard, Baltimore, MD 21235-6401, (410) 965-5419.

SUPPLEMENTARY INFORMATION:

Continuing Education Requirement

    Section 303(b)(5) of the SSPA requires that participants in the 
demonstration project on direct payment of fees to non-attorneys 
demonstrate ongoing completion of qualified courses of continuing 
education, including education regarding ethics and professional 
conduct, that are designed to enhance professional knowledge in matters 
related to entitlement to, or eligibility for, benefits based on 
disability under titles II and XVI of the Social Security Act (the 
Act). That section also provides that the continuing education courses 
and instructors shall meet such standards as we shall prescribe.
    Courses provided by an accredited college or university, a State 
bar association, an organization accredited by a State bar, a 
professional organization that (in whole or in part) specializes in 
representing claimants before governmental agencies (e.g., the American 
Bar Association, the National Organization of Social Security 
Claimants' Representatives, and the National Association of Disability 
Representatives, Inc.), or a governmental agency may be used to meet 
the continuing education requirement. Generally, we will defer to the 
organization providing the course as to the subject matter, the 
requirements for receiving credit for an hour of instruction, and the 
qualifications of the instructor, though we reserve the right to reject 
specific courses or instructors if we determine that the course or the 
instructor is unacceptable.
    We have determined that participants in the demonstration project 
will be required to complete at least 12 hours of qualifying continuing 
education courses in the 18-month period beginning 6 months prior to 
the month in which we notify the individual that he or she has passed 
the examination. After this initial 18-month period, the representative 
will be required to complete 24 hours of instruction in each 
subsequent, 2-year period. For example, if we notify an individual that 
he or she passed the examination in July 2005, the initial, 18-month 
period begins January 1, 2005, and runs through June 30, 2006. The 
first 2-year period begins July 1, 2006, and the next begins July 1, 
2008.
    In each continuing education period, participants must take at 
least one hour of continuing education on ethics and professional 
conduct for representatives and at least one hour of continuing 
education regarding entitlement to, or eligibility for, benefits under 
titles II and XVI of the Act. Participants are otherwise free to 
determine the mix of course hours from these two categories.
    In recognition of the additional work involved in teaching a 
continuing education course, a participant may receive 2 hours of 
credit per 1 course hour, up to a maximum of 6 hours, if the 
participant was an instructor in the course. The 2 for 1 credit applies 
only with respect to a course hour during which the applicant was an 
instructor. For example, if the applicant was an instructor during 2 
hours of a 3-hour course, the applicant would be credited with 5 
continuing education hours.
    Continuing education is credited on the day the course is 
completed, and is credited to the continuing education period in which 
the course completion date occurs, unless it is used to complete an 
unmet continuing education requirement from the prior period. Thus, for 
example, for a non-attorney representative who has 18-month and 24-
month continuing education periods as described above, all of the hours 
in an 8-hour class that begins on June 30, 2006, and ends on July 1, 
2006, would be credited to the 24-month period beginning July 1, 2006, 
unless one or more of those hours is used to complete an unmet 
continuing education requirement for the period ending June 30, 2006. 
Hours earned in one continuing education period may be used to satisfy 
an unmet requirement for the prior period only for the purpose of 
ending a suspension that has gone into effect, not to prevent the 
occurrence of a suspension. Any continuing education hours allocated to 
a prior continuing education period in this manner may not also be 
counted toward the continuing education requirement in the current 
period. Thus, for example, if 1 hour of an 8-hour course completed in 
the current period is used to satisfy an unmet continuing education 
requirement for the prior period, only 7 of the 8 education hours from 
the course would be credited toward satisfaction of the continuing 
education requirement for the current period.
    A participant in the demonstration project who fails to timely meet 
the continuing education requirement will be suspended from receiving 
direct payment of fees in the demonstration project until we determine 
that the requirement has been met and we end the suspension. A 
suspension takes effect in the continuing education period after the 
period in which the participant failed to meet the continuing education 
requirement. We will not withhold or make direct payment of fees to the 
representative in any case we effectuate while the suspension is in 
effect. For this purpose, the date of effectuation is the date on which 
an authorized SSA employee first certifies that the evidence necessary 
to make payment in a case is present.
    Prior to suspending a participant, we will notify him or her that 
we propose to suspend eligibility for direct payment of fees unless he 
or she protests within 10 calendar days of the date of notice of 
proposed suspension and shows us that the requirement was timely met. 
If there is no protest, the suspension will be effective the first day 
of the month following the month in which the protest period ends. If 
there is a protest and we determine that the continuing education 
requirement was not timely met, the suspension will be effective the 
first day of the month following the month in which we notify the

[[Page 41251]]

participant that we have denied the protest. In either case, we will 
notify the participant of the date on which the suspension will take 
effect. The participant's suspended status will be posted to the 
internal computerized system we use to track the eligibility of non-
attorney representatives to receive direct payment of fees as of the 
first day of the suspension.
    We will terminate a suspension if the suspended individual notifies 
us of the completion of the outstanding course work and we determine 
that the previously unmet requirement has been satisfied. A suspension 
ends effective with the first day of the month following the month in 
which we determine that the non-attorney representative has satisfied 
the unmet continuing education requirement from the prior period, 
unless we make that determination in the first month of the current 
period. In the latter event, in order to ensure that failure to timely 
meet the continuing education requirement results in an actual 
suspension, considering our rules for when a suspension begins and 
ends, the suspension ends effective with the first day of the second 
month following the month in which we determine that the previously 
unmet requirement has been satisfied. We will notify a participant in 
advance of the date on which a suspension will end. We will also modify 
our tracking site as of that date to reflect the representative's 
renewed eligibility to receive direct payment of fees. Favorably 
decided cases that are effectuated (see above) on the day the 
suspension ends will be subject to benefit withholding and direct 
payment of fees.
    Periods in which a participant in the demonstration project is 
ineligible for direct payment of fees because of failure to meet the 
continuing education requirement will not extend the continuing 
education periods that apply with respect to the participant. Thus, for 
example, if an individual whose 18-month and 24-month education periods 
begin on, respectively, January 1, 2005, and July 1, 2006, becomes 
ineligible to participate in the project for the months of August and 
September of 2006 because of failure to meet the continuing education 
requirement for the prior period ending June 30, 2006, the individual's 
continuing education period of July 1, 2006, through June 30, 2008, 
would not be extended. The individual must still complete the required 
24 hours of continuing education courses for that latter period by June 
30, 2008.
    Participants will be required to report continuing education to CPS 
Human Resource Services (CPS), the private contractor we are using to 
assist us in administering the prerequisites process (see below for 
additional information concerning CPS). CPS will make available, on its 
Web site at http://www.cps.ca.gov/ssa/signin.asp, an electronic 
template upon which participants may upload their continuing education 
information. Participants also may submit the information by completing 
a paper form available from CPS. Participants must include the 
following information on each course: (1) Name of the course; (2) name 
of the organization providing the course; (3) dates of the course, 
including the course completion date; (4) number of hours completed, as 
determined by the organization providing the course; (5) course 
description provided by that organization; (6) subject category (i.e., 
either ethics and professional conduct or benefit entitlement/
eligibility based on disability under title II or title XVI of the 
Act); (7) whether a certificate was received for taking the course; (8) 
name of the course instructor(s); (9) information for contacting the 
instructor and the organization; and (10) whether the project 
participant was an instructor in the course and, if so, the number of 
course hours during which the participant was an instructor.

Changes to the Insurance Requirements

    Under section 303(b)(3) of the SSPA, non-attorney representatives 
who apply to participate in the demonstration project must have 
professional liability insurance or equivalent insurance adequate to 
protect claimants in the event of malpractice by the representative. On 
January 13, 2005, we announced that applicants would be required to 
have professional liability insurance for coverage of errors and 
omissions in the minimum total annual amount of $1 million (for all 
incidents in the year) plus coverage of $250,000 per incident (70 FR 
2447, 2449). After further consideration, and based on experience 
gained in the first application period, which began on March 7, 2005, 
we have decided to reduce the per-incident minimum coverage from 
$250,000 to $100,000, and consider business liability insurance to 
constitute insurance equivalent to professional liability insurance 
provided the business insurance provides coverage that satisfies the 
required minimum per-incident and aggregate amounts. We have also 
decided to change the minimum annual aggregate coverage amount for an 
individual's professional liability insurance to $500,000 and the 
minimum annual aggregate amount under a business liability policy to 
the amount determined in accordance with the following schedule--

------------------------------------------------------------------------
                                                               Minimum
                Number of covered employees                   aggregate
                                                                amount
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1 to 10....................................................     $500,000
11 to 25...................................................    1,000,000
26 to 50...................................................    2,000,000
51 to 100..................................................    3,000,000
101 to 200.................................................    4,000,000
201 or more................................................    5,000,000
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    We believe that these insurance coverage amounts will adequately 
protect claimants in the event of malpractice by non-attorney 
representatives, while increasing the ability of non-attorney 
representatives who wish to participate in the demonstration project to 
obtain insurance. These amounts are consistent with insurance agency 
practices and standards, which emphasize the per-incident coverage and 
rely on graduated schedules in increasing minimum aggregate amounts.
    When we determine that a participant has failed to maintain the 
required insurance coverage, we will notify the individual that his or 
her eligibility for direct payment of fees will be suspended unless 
proof that the required insurance coverage is in force is submitted 
within 15 calendar days of the date of our notice. We will send the 
individual an additional notice following that period to advise the 
individual whether eligibility for direct payment will be suspended.
    A suspension for failure to maintain the required insurance 
coverage takes effect on the first day of the month following the month 
in which we notify the individual that eligibility will be suspended. A 
suspension for failure to maintain required insurance coverage ends 
effective with the first day of the month following the month in which 
we notify the individual that we have determined that the required 
insurance coverage is again in force. We will not withhold or make 
direct payment of fees to the representative in any case we effectuate 
while the suspension is in effect.

Opportunity To Cure Defective Applications

    In the Federal Register notice of January 13, 2005, we indicated 
that applicants who failed to have their completed application 
materials postmarked within the 4-week application period would have 
their applications rejected and would be required, if they wanted to 
participate in the demonstration project, to file a new

[[Page 41252]]

application and again pay the $1000 application fee in a subsequent 
application period (70 FR 2447, 2448). Based on experience gained 
during the first application period (i.e., the 4-week period that began 
on March 7, 2005), we have determined that applicants experienced 
significant difficulties in submitting, within such a short time, proof 
of satisfaction of the prerequisites concerning insurance, education or 
equivalent experience, and representational experience before SSA. 
Therefore, we have decided to allow applicants who have submitted their 
application and paid their application fee of $1000 an additional 
period in which they may perfect an otherwise incomplete application 
package before we make a determination on their application. For 
example, applicants may perfect their applications by substituting the 
names and SSNs of additional clients that they have represented within 
a requisite period if their original submissions in support of the 
representational requirement cannot be verified, or by obtaining 
appropriate liability coverage if the coverage originally submitted is 
found to be inadequate. The period for perfecting the application, 
which applies only where the application fee has been timely paid, ends 
6 weeks after the close of the 4-week application period.

Opportunity To Protest Denial of Application

    Based on experience gained during the first application period, we 
have also decided to give individuals who have submitted an application 
that we deny for any reason, including failure of the examination, an 
opportunity to protest our denial of the application. A denied 
applicant may protest by filing a protest within 10 calendar days of 
the date of our notice denying his or her application. It is the 
responsibility of the applicant to provide any factual information and 
documentation to support the protest. If we have denied the individual 
an opportunity to sit for the examination, the individual has a further 
opportunity during the protest period following our denial notice to 
correct defects in his or her application, other than failure to timely 
pay the application fee. Our action in response to the protest is final 
and not subject to further review.

Refund or Credit for Application Fee

    We have further determined based on experience in the first 
application period that applicants who timely pay their application 
fee, but do not take the examination, will have an opportunity, upon 
request and where warranted, to have the fee payment either refunded or 
applied to satisfy the fee requirement of a subsequent application (the 
other requirements of which must be satisfied in the subsequent 
application period). In deciding whether to refund a fee payment, to 
credit the payment to a subsequent application period, or neither to 
refund or provide a credit for the payment, we will assess whether the 
particular circumstances of an individual's case warrant that action, 
considering basic principles of fairness and sound management. Our 
determination in response to an applicant's request to have a fee 
payment refunded or applied to a subsequent application period is final 
and not subject to review. We will not consider refunding or crediting 
a fee payment to a subsequent application under any circumstances where 
an individual has taken and failed the prerequisite examination.
    In considering requests for fee relief in cases in which the 
examination has not been taken, we consider all the circumstances of 
the particular case. An example of circumstances in which we could find 
that a fee refund is warranted include those in which an illness 
diagnosed before we complete processing of the application to determine 
eligibility to sit for the examination will prevent the applicant from 
serving as a claimant's representative. Examples of circumstances in 
which we could decide to credit a fee payment to a subsequent 
application include those in which an applicant is prevented from 
taking a scheduled examination by circumstances beyond the applicant's 
control, such as a death in the applicant's immediate family, a 
documented illness of the applicant, or a transportation problem that 
could not have been reasonably anticipated and planned against. We will 
also consider refunding or crediting a paid fee in cases in which we or 
CPS provide the applicant erroneous information or information that is 
not sufficient to inform the applicant adequately regarding the rules 
of the demonstration project. An example of a situation in which we 
would not grant fee relief would be that in which an applicant fails to 
arrive on time for an examination because of circumstances not beyond 
the applicant's control, such as a traffic problem or a child-care 
problem of a type that could have been anticipated and planned against.

Clarification of Requirement Regarding Representational Experience

    The Federal Register notice of January 13, 2005, announced that 
applicants would be required to show that they had provided 
representational services as the appointed representative for 5 
claimants before SSA within a 24-month period occurring within the 60 
months in which the application was filed, and that the 
representational experience could include representing the claimant at 
the time at which SSA decided the case at any administrative level or, 
in cases that have not yet been decided, at a hearing before an SSA 
Administrative Law Judge (ALJ). (70 FR 2447, 2449.) We are in this 
current notice clarifying this requirement by specifying that it cannot 
be satisfied except on the basis of having served as the appointed 
representative of 5 claimants at one (or more) of these specified 
times. Representing a claimant before SSA can count toward satisfaction 
of the representational requirement only if the applicant was serving 
as the claimant's appointed representative at the time at which SSA 
decided the case at any administrative level (i.e., the initial, 
reconsideration, ALJ hearing, or Appeals Council level) or, if the case 
has not been decided while the applicant was the appointed 
representative, the applicant appeared as the claimant's appointed 
representative at a hearing before an ALJ.

Additional Information

    Additional information on the demonstration project is available on 
our Representing Claimants Web site at http://www.ssa.gov/representation/. CPS can be reached by:
     Mail, sent to: CPS Human Resource Services, SSA Non-
Attorney Representative Demonstration Project, 241 Lathrop Way, Suite 
A, Sacramento, CA 95815-4242.
     E-mail, sent to [email protected].
     Telephone, toll free at 1-800-376-5728. The local number 
in Sacramento is 916-263-3600.

(Catalog of Federal Domestic Assistance Program Nos. 96.001, Social 
Security-Disability Insurance; 96.002, Social Security-Retirement 
Insurance; 96.004, Social Security-Survivors Insurance; and 96.006, 
Supplemental Security Income)
    Dated: July 14, 2005.
Fritz Streckewald,
Assistant Deputy Commissioner for Program Policy for Disability and 
Income Security Programs.
[FR Doc. 05-14138 Filed 7-15-05; 8:45 am]
BILLING CODE 4191-02-P