| Foster Care Independence Act Signed Into Law - Provisions Included On SSI Overpayments, Treatment Of Trusts And Transfer Of Assets |
It is important to note that these changes to the SSI program are substantially scaled back from a package of fraud and abuse changes that the House Ways and Means had considered early in 1999. These changes would have made deep cuts in benefits for persons living in group homes, altered the definition of disability for children and negatively impacted existing special needs trusts. After an outpouring of opposition from disability advocates (including NAMI), Congress abandoned these proposals and instead moved forward on these more modest reforms designed to combat fraud.
Included below is an analysis, compiled by the National Organization of Social Security Claimants' Representatives (NOSSCR), of provisions impacting SSI that are a part of the new law. More detailed information is available through the Social Security Administration's website at http://www.ssa.gov/legislation/legis_bulletin_112499.html
National Organization of Social Security Claimants' Representatives (NOSSCR)
INCREASED COLLECTION OF SSI OVERPAYMENTS
SPECIAL BENEFITS FOR CERTAIN WORLD WAR IF VETERANS
A new benefit program (Title VIII of the Social Security Act) will pay 75% of the SSI benefit rate to certain elderly World WarII veterans of the U.S. Armed Forces who reside outside of the United States (Sec. 251).
COUNTING TRUSTS AS A RESOURCE
Section 205 amends 42 U.S.C. § 1382b(c) to count trusts, established on or after January 1, 2000, as resources for SSI purposes. The trusts will be considered regardless of whether they are revocable or irrevocable, the purposes for which they are established, whether the trustees have discretion, or any restrictions on the use of distributions. Earnings to the corpus will be counted as income.
There are a number of exceptions to application of the new rule which are similar to those found in the Medicaid program:
The Medicaid Act is amended for states that provide noncategorical Medicaid and use SSI criteria to determine eligibility. If the individual is not "receiving" SSI, the State may not use the SSI trust rules to determine eligibility for noncategorical Medicaid.
TRANSFER OF ASSETS PENALTY
Section 206 amends 42 U.S.C. § 1382b(c) to reinstate an SSI transfer of assets penalty to transfers made on or after the date of enactment, December 14, 1999. A person who disposes of resources for less than fair market value (FMV) will have their SSI benefits reduced for the period of time equal to the uncompensated value of the transferred resource divided by the maximum monthly SSI benefit and any SSI State supplement.
There is a 36-month "look-back" period starting with the later of the SSI application date or the date of the transfer. 42 U.S.C. §§ 1382b(c)(1)(A)(ii)(I) and (II). The maximum penalty period is 36 months, starting with the month of the transfer. 42 U.S.C. §§ 1382b(c)(1)(A)(iv). There is no "double-counting," i.e., the transfer is either treated as an available resource or a transfer for purposes of the penalty, but not both. 42 U.S.C. §§ 1382b(c)(1)(B)(i).
Similar to Medicaid, there are a number of important exceptions to application of the penalty:
(I) the spouse of the transferor;
(II) the transferor's child who is under age 21 or who is blind or disabled, regardless of age;
(III) the sibling of the transferor who has an equity interest in the home and was residing in the home for at least one year immediately before the date the transferor becomes institutionalized; or
(IV) the transferor's child who was residing in the home for at least two years before the transferor becomes institutionalized and who provided care to the transferor which permitted the transferor to reside at home rather than in an institution.
See 42 U.S.C. § 1382c(l)(C)(i).
(II) from the transferor's spouse to another for the sole benefit of the transferor's spouse;
(III) to the transferor's disabled or blind child or to a trust established solely for the benefit of the transferor's disabled or blind child, including, but not limited to, a "(d)(4)(A)" trust; or
(IV) to a trust, including, but not limited to, a "(d)(4)(A)" trust established solely for the benefit of an individual under age 65 who is disabled.
See 42 U.S.C. § 1382c(l)(C)(ii).