Federal Law and Policy

2018 H.R. 4547, the Strengthening Protections for Social Security Beneficiaries Act, among other things, requires the Social Security Administration (SSA) to:

• make annual grants to each state's protection and advocacy system for the purpose of conducting reviews of representative payees under the Supplemental Security Income (SSI) program and the Old Age, Survivors, and Disability Insurance (OASDI) program;

• conduct periodic onsite reviews of individual and organizational payees;

• Report to specified congressional committees on certain issues related to representative payment with respect to SSI and OASDI benefits; and

• enter into agreements with each state for the purpose of sharing information to identify represented minor beneficiaries who are in foster care;

• determine the appropriate representative payee for any represented minor beneficiary who has entered foster care, exited foster care, or changed foster care placement in a given month.

The bill modifies provisions related to overpayment liability with respect to a represented minor beneficiary in foster care.

The Act also requires the Government Accountability Office to report to specified congressional committees on certain issues related to represented minor beneficiaries in foster care. Accordingly, in 2021 GAO released “Social Security Administration: New Data Exchanges with Some States Provide Limited Information on Foster Care Beneficiaries,” and reported that:

• The 2018 Act called for more information sharing between SSA and states on SSA beneficiaries in foster care and their payees.

• The legislation didn't explicitly require state child welfare agencies to enter into data exchange agreements, according to SSA, but 31 states have done so. Of those, 14 states were actively sharing data with SSA as of April 2021.

• According to SSA, the Act does not provide SSA with a mechanism to compel states to enter into data exchange agreements or to do so within a certain time frame.

• National data from SSA show that child welfare agencies were the payees for about 81% of the more than 25,000 represented minor beneficiaries in foster care as of November 30, 2020; however, these data likely reflect an undercount. SSA staff stated the agency would not have complete information on these beneficiaries until all states were participating in the Section 103(a) data exchanges.

• According to SSA, information submitted through these exchanges has helped the agency identify over 5,500 instances in which it determined it should appoint a new payee for a minor beneficiary in foster care.

• SSA had sufficiently reliable accounting data for 2020 on child welfare agencies that served as payees for seven of the 11 states participating in the exchanges. These payees reported that Social Security funds were primarily used to cover the direct expenses of the beneficiary, such as for housing and food. Among the seven states, these payees conserved 15% or less of the Social Security funds on behalf of the beneficiary.

For more information on the Act, see SSA’s Social Security Legislative Bulletin No. 115-9 (April 24, 2018).

To download an Excel document displaying the status of state compliance with the Act’s data sharing requirements as of July 1, 2023, click here.

42 U.S.C. § 1383(a)(2)

42 U.S.C. § 672 requires that states pay for the maintenance of all youth in foster care: “each State with a plan approved under this part shall make foster care maintenance payments on behalf of each child who has been removed from the home of a relative....”

42 USC § 675(4)(A) defines foster care maintenance payments to include food, shelter, clothing, supervision, etc.

20 CFR § 416.645 provides that if payments are not needed for the beneficiary's current maintenance or reasonably foreseeable needs, they shall be conserved or invested on behalf of the beneficiary.

• Press Release (Feb. 14, 2024)
• Advancing Equity at SSA

• Payee and ABLE Accounts

• March 21, 2024 Correspondence from SSA Commissioner Martin O’Malley to the Hon. Danny K. Davis

• meet with the beneficiary on a regular basis to ascertain their current and foreseeable needs;
• use funds in the beneficiary's best interest;
• conserve benefits not needed for the beneficiary's current needs;
• keep detailed and accurate records of how the payee uses benefits in order to provide an accurate report to SSA when requested;
• complete the accounting form online or return the completed form timely once a year;
• report events that may affect the beneficiary's entitlement or amount of payment (including the beneficiary's death or incarceration);
• report if you are unable to locate or contact the beneficiary;
• cooperate with Title XVI eligibility redeterminations;
• ensure that medical treatment is obtained for minor children receiving SSI disability payments;
• report address and custody changes;
• report any change in circumstances which would affect performance as payee;
• return any benefits to which the beneficiary is not entitled;
• act for the beneficiary on matters relating to the beneficiary's claim;
• notify SSA if the beneficiary no longer needs a payee; and
• return any conserved funds or unused benefits to SSA when payee services terminate.

• Cases involving foster care are among the most sensitive SSA encounters. It is essential that SSA do all it can to protect the rights of children who may not be able to rely on their parents to do so.
• It is extremely important that SSA follow all legal requirements, including conducting a complete investigation of the individual or organizational representative payee applicant, using the payee preference list appropriately to identify when other payee leads should be developed and providing due process to the child’s parent and/or legal guardian.
• The primary concern must be that the person, agency or organization selected as payee will best serve the interest of the child.
• When selecting a payee for a child in foster care, SSA is to exercise caution and follow proper procedures to ensure they appoint the best payee available and provide appropriate due process. Do not routinely appoint the foster care agency as payee for a child in foster care. Gather all pertinent information and make a thoughtful and careful choice and decide each case on its own merit.
• SSA is to ensure that the foster care agency answers all pertinent questions during the payee application process. Make sure they tell you whether the child has a living parent or other interested family member. If they answer “no” (or they do not know) to the parent question, review all court documents obtained, the MBR/SSR and/or case file to determine if we have any record of a parent or other family member.
• When interviewing the representative of the foster care agency, take the time to fully discuss their payee responsibilities, including:
  • using and saving the money for the child’s benefit;
  • filing annual accounting reports;
  • reporting changes (including adoptions and custody changes) which affect the beneficiaries’ eligibility and benefit amount;
  • record keeping; and
  • returning conserved funds.

• A payee has the responsibility to use the benefits received on behalf of a beneficiary only for the use and benefit of the beneficiary.
• The payee receives the benefit with the full right and duty to spend it in the best interests of the beneficiary.
• A payee must use benefits to provide for the beneficiary's current needs such as food, clothing, housing, medical care and personal comfort items, or for reasonably foreseeable needs. If not needed for these purposes, the payee must conserve or invest benefits on behalf of the beneficiary.

• The law requires SSA to provide advance notice about the payee appointment to the proper persons.
• Where the beneficiary is a child, SSA is required to send an advance notice to the legal guardian or legal representative, if he/she is not the proposed payee.
• The parents (or legal guardian) of a child in foster care must be provided advance notice of the appointment unless their parental rights were terminated by a court.
• See also NL 00703.769 (Representative Payee Advance Notice to Legal Guardian, Parent or Person Standing in Place of Parent — If Not Proposed Payee)

• agree to receive benefits on behalf of the beneficiary and use or conserve them in the beneficiary's best interest;
• understand the payee’s duties and the liability of non-compliance with reporting requirements;
• are willing to carry out the responsibilities of a payee;
• understand the liability for any overpayment for which the payee may be at fault; and
• understand serving as a payee is voluntary and they may not charge a fee for providing payee services except as provided in GN 00506.001.

GN 00603.041 (The Use of Achieving a Better Life Experience (ABLE) Accounts by Representative Payees) provides information on when a representative payee may use an ABLE account to manage a beneficiary’s SSA benefits and how our existing payee policies apply when a payee chooses to use an ABLE account to manage a beneficiary’s SSA benefits.

GN 00502.110 (Taking Applications in the eRPS) describes the electronic Representative Payee System (eRPS), a web-based application that processes representative payee applications and contains all representative payee related information.

DI 25201.011 (Making a Determination for Youth in Foster Care When the Application Effective Date Is On or After the Attainment of Age 18)

SI 00830.410 (Foster Care Payments)

SI 00830.810 (Bureau of Indian Affairs Adult Custodial Care and Child Welfare Assistance Payments) provides that Bureau of Indian Affairs (BIA) Adult Custodial Care (ACC) and Child Welfare Assistance (CWA) payments are made on behalf of both institutionalized and noninstitutionalized recipients. BIA foster care payments are made under the ACC and CWA programs. How SSI treats institutionalized, noninstitutionalized, and foster care recipients varies accordingly.

Child Welfare Policy Manual Selected Provisions:

• 8. Title IV-E
• 8.2B.12 TITLE IV-E, Adoption Assistance Program, Eligibility, SSI
• 8.4D TITLE IV-E, General Title IV-E Requirements, Concurrent Receipt of Federal Benefits