106-14
December 17, 1999

On December 14, 1999, the President signed into law the Foster Care Independence Act of 1999, Public Law 106-169. The law includes provisions relating to foster care and the OASDI and SSI programs, and establishes a new title VIII of the Social Security Act for providing special cash benefits to certain World War II veterans.

OASDI And SSI PROVISIONS

Title II of the bill includes OASDI and SSI provisions. H.R. 3443 incorporates technical changes suggested by SSA in a previously House-passed foster care bill, H.R. 1802 (Legislative Bulletin 106-9). A provision in H.R. 1802 that was not included in H.R. 3443 would have prohibited OASDI and SSI eligibility based on disability for 10 years if ex-fugitive or ex-prisoner knowingly fails to notify SSA at time of (re)application that he or she had received benefits erroneously while in prison or knowingly fails to comply with scheduled repayment of overpayment. Following are descriptions of the provisions in H.R. 3443 relating to SSA-administered programs and a summary of the foster care provisions.

Liability of Representative Payees for Overpayment to Deceased Recipients (Section 201)

• Makes a representative payee liable for an OASDI or SSI overpayment caused by a payment made to a beneficiary who has died. Also requires SSA to establish an overpayment control record under the representative payee's Social Security number.

  Effective with respect to overpayments made 12 months or more after the date of enactment.

Recovery of Overpayments of SSI Benefits From Lump Sum SSI Benefit Payments (Section 202)

• Requires the Commissioner to recover SSI overpayments from SSI lump-sum amounts by withholding 50 percent of the lump sum or the amount of the overpayment, whichever is less.

  Effective 12 months after the date of enactment and applies to overpayment amounts that are outstanding on or after the effective date.

Additional Debt Collection Practices (Section 203)

• Extends to the SSI program all of the debt collection authorities currently available for the collection of overpayments under the OASDI program.

  Applies to overpayment amounts that are outstanding on or after the date of enactment.

Requirement To Provide State Prisoner Information to Federal and Federally Assisted Benefit Programs (Section 204)

• Requires the Commissioner to provide, on a reimbursable basis, information obtained under agreements with institutions for reporting prisoners to Federal or federally assisted cash, food, or medical assistance programs.

  Effective upon enactment.

Treatment of Assets Held in Trust Under the SSI Program (Section 205)

• Includes in the countable resources of an individual for SSI purposes, the assets of any trust containing property transferred from the individual or spouse to the extent that the assets could be used for the benefit of either. Any earnings of, or additions to, the corpus of such a trust would be counted as the individual's income. The Commissioner is authorized to waive application of the provision in cases of undue hardship. Excludes certain trusts (e.g., those established by will, or trusts that would repay the State the cost of services provided the beneficiary upon his or her death). Ensures that SSI beneficiaries who lose their SSI benefits because of assets held in trust will not automatically lose their Medicaid benefits.

  Applies to trusts established on or after January 1, 2000.

Disposal of Resources for Less Than Fair Market Value Under the SSI Program (Section 206)

• Provides a penalty under the SSI program for the disposal of resources at less than fair market value. The penalty is a loss of benefits for a number of months (up to a 36-month maximum) obtained by dividing the uncompensated value of disposed-of-resources by the Federal benefit rate plus the maximum State supplementary payment, if any, applicable to the individual's living arrangement.

  Applies to disposal of resources made on or after the date of enactment.

Administrative Procedure for Imposing Penalties for False or Misleading Statement (Section 207)

• Adds a new penalty of nonpayment of OASDI and SSI benefits for individuals found to have made a statement or representation of material fact for use in determining eligibility for benefits under the OASDI and SSI programs that the individual knew, or should have known, was false or misleading or omitted a material fact. The period of nonpayment is 6 months for the first violation, 12 months for the second, and 24 months for the third violation. Requires the Commissioner to develop regulations within 6 months to carry out the provision. Also deletes the current-law SSI provision that denies benefits for 10 years for an individual convicted of making a fraudulent statement in order to collect assistance payments simultaneously in two or more States.

  Effective with statements and representations made on or after the date of enactment.

Exclusion of Representatives and Health Care Providers Convicted of Violations From Participation in Social Security Disability Programs (Section 208)

• Bars representatives and health care providers from the OASDI and SSI programs if they were found to have helped commit fraud. Bar would be for 5 years, 10 years, and permanent exclusion for the first, second, and third offenses respectively.

  Effective with respect to violations and convictions occurring on or after the date of enactment.

State Data Exchanges (Section 209)

• Deem the SSA's data privacy standards to meet all State privacy standards for purposes of sharing data.

  Effective upon enactment.

Study on Possible Measures To Improve Fraud Prevention and Administrative Processing (Section 210)

• Requires the Commissioner in consultation with the OIG and the Attorney General to undertake a study to identify possible measures to reduce fraud for those receiving OASDI based on disability and all SSI beneficiaries and to improve processing of those beneficiaries' reported changes of income. Also requires a report to the House Committee on Ways and Means and the Senate Finance Committee on legislative and administrative recommendations in these areas.

  Report would be due not later than 1 year after date of enactment.

Annual Report on Amounts Necessary To Combat Fraud (Section 211)

Requires SSA to include in its annual budget an itemization of the amount of funds required to support efforts to combat fraud by applicants and beneficiaries.

Effective with respect to annual budgets for fiscal years after fiscal year 1999.

Computer Matches with Medicare and Medicaid Institutionalization Data (Section 212)

• Requires the Commissioner to conduct periodic matches with Medicare and Medicaid data held by the Secretary of HHS, and permits the Commissioner to substitute information from the matches for the physician's certification otherwise required in order to maintain the full benefit level of an individual whose institutionalization is expected not to exceed 3 months.

  Effective upon enactment.

Access to Information Held by Financial Institutions (Section 213)

• Provides that the Commissioner may require SSI applicants and beneficiaries to provide authorization for SSA to obtain any and all financial records from any and all financial institutions. These authorizations would remain in effect, unless revoked in writing. The Commissioner need not furnish to the financial institution copies of the authorizations or written certification of compliance with the provisions of the Right to Financial Privacy Act. Refusal to provide, or revocation of, an authorization may result in ineligibility for SSI.

  Effective upon enactment.

Special Benefits for Certain World War II Veterans (Section 251)

• Establishes a new title VIII of the Social Security Act, that would entitle every individual who is a "qualified individual" to a monthly benefit paid by the Commissioner of Social Security for each month after September 2000 (or sooner, if administratively feasible) that such individual resides outside of the 50 States, District of Columbia, and the Northern Mariana Islands. A "qualified individual" is defined as an individual: who is a World War II veteran aged 65 or older who is eligible for SSI in both the month of enactment and the month in which he or she files an application for the special benefits; whose total "benefit income" is less than 75 percent of the SSI Federal benefit rate (FBR); who has filed an application for special benefits; and, who is fully compliant with all other requirements for special benefits imposed by the Commissioner.
• Provides that the amount of the special benefit for a month would be an amount equal to 75 percent of the SSI FBR, minus the amount of the individual's "benefit income" for such month. "Benefit income" is any recurring payment received by an individual as an annuity, pension, retirement or disability benefit, but only if it were received during the 12-month period immediately preceding an individual's application for special benefits.
• Authorizes the Commissioner to prescribe regulations to make administrative arrangements necessary to carry out the special benefit program. Also authorizes the Commissioner to determine when and how benefits would be paid, and provides the authority for redetermining eligibility and suspending and terminating benefits under specified conditions.
• Appropriates such sums as necessary to carry out the special benefit program beginning with fiscal year 2000.
• Also makes conforming amendments for reimbursing the Social Security trust funds for administrative expenses, adding the special benefit program to the programs under the auspices of the Social Security Advisory Board, making civil monetary penalty provisions applicable to the special benefit program, and authorizing recovery of SSI and OASDI overpayments from special benefits.

Study of Denial of SSI Benefits for Family Farmers (Section 261)

• Requires the Commissioner to study the reasons why family farmers with resources of under $100,000 are denied SSI benefits, including whether the deeming policies discriminate against family farmers. The study would include the number of family farmers who have been denied benefits in each of the past 10 years. The Commissioner is required to submit a report to the House Ways and Means Committee and Senate Finance Committee with the results of the study within 1 year.

FOSTER CARE PROVISIONS

• Title I of the bill provides States with flexible funding to help children who are likely to "age out" of foster care at age 18 to obtain employment or continue their education. States would promote the self-sufficiency of these young people by providing assistance in obtaining a high school diploma, post-secondary education, career exploration, housing, vocational training, job placement and retention, training in budgeting, substance abuse prevention education, and education in preventive health measures including smoking avoidance, nutrition education, and pregnancy prevention.
• Title I also increases the current-law resource limit of $1,000 to $10,000 for the purpose of determining a child's eligibility for Federal foster care payments.
• Changes in the Medicaid law permits States to provide Medicaid coverage to those 18-, 19-, and 20-year olds who have left foster care. States would also be permitted to use means testing to provide Medicaid to former foster care youths if their income and resources are below certain specified levels.
• Title I of the bill increases funding for adoption incentive payments.