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M21-1, Part X, Chapter 02 – Social Security Verification Match

1.  General Information on the Social Security Verification Match


Introduction

This topic contains general information on the Social Security verification match, including the

Change Date

July 23, 2004

X.2.1.a.  Information Sent to VA by the SSA

Once a year, the Social Security Administration (SSA) provides information on SSA rates for recipients of
  • pension, and
  • Parents’ Dependency and Indemnity Compensation (DIC).
Note:  In an effort to verify reported income by the above beneficiary, this processing is done at the time of the cost-of-living adjustment (COLA).

X.2.1.b.
Social Security Match Record Update

The table below describes how the Department of Veterans Affairs (VA) master records are updated using the Social Security payment data.
Stage
Description
1
VA sends the SSA an extract of its pension and Parents’ DIC files.
2
The SSA runs this extract against the master beneficiary record (MBR) file and Master Earnings File (MEF) and inserts Social Security payment data.
3
The extract tape is then returned and VA master records are updated.

 

2.  Calculation of  VA -Computed Social Security Rate


Introduction

This topic contains information on the calculation of VA-computed Social Security rate, including

Change Date

July 31, 2015

X.2.2.a.  Estimated Post-COLA Rate

If a COLA is authorized, VA pension and Parents’ DIC benefits are increased by the same percentage and at the same time as the Social Security benefits.  Therefore, VA estimates a joint VA/Social Security post-COLA Social Security rate for each beneficiary.
Estimated Income for VA Purposes (IVAP)
The estimated Social Security rate is used to determine the VA beneficiary’s IVAP until VA processes the extract tape with the actual post-COLA SSA rate.
Social Security Rates Differ by $10 or More
When exact rates are processed, VA compares them to the estimated rates.  If the monthly Social Security rates differ by $10 or more, the pension management center (PMC) of jurisdiction must resolve the discrepancy. A write out is created to inform the PMC that a review of the income is required.
Note:  This is a systematic review.  Review all discrepancies in income, regardless of the amount of deficiency.

X.2.2.b.  No SMIB Deduction

If there is no Medicare or supplementary medical insurance benefit (SMIB) deduction in the master record, multiply the verified Social Security monthly amount in the master record or the monthly Social Security amount, in unverified cases, by the COLA factor.
Example:  If the COLA is 4%, multiply the monthly Social Security amount by 1.04.

X.2.2.c.  New Monthly Social Security

Use the table below to understand how VA calculates the new monthly Social Security payment for verified and unverified cases if there is no SMIB deduction.
If the monthly amount in master record is …
Then VA rounds the monthly amount in the master record to next lower …
verified
dollar and the resulting amount is considered the new monthly Social Security payment.
unverified
dime and the resulting amount is considered to be the new monthly Social Security payment.

X.2.2.d.  Post-COLA Social Security IVAP

Use the table below to understand how VA calculates the post-COLA Social Security IVAP for a verified or unverified case.
If it is …
Then VA would …
a verified case
  • multiply the Social Security rate by the COLA adjustment
  • round down to the next lower dollar, and
  • multiply by 12 for IVAP.
an unverified case
  • multiply the Social Security rate by the COLA adjustment
  • round down to the nearest dime, and
  • multiply by 12 for IVAP.

X.2.2.e.  Standard SMIB(Medicare) Deduction

The standard SMIB deduction amounts will be provided to PMCs annually.  The COLA amount will also be provided at that time.
If the master record contains a standard SMIB deduction the
  • monthly Social Security rate will always be verified, and
  • new standard SMIB deduction will be used to compute the post-COLA Social Security monthly amount.
Follow the steps in the table below to calculate the Social Security rate with a standard SMIB deduction.
Step
Action
1
Multiply the verified rate by the COLA factor and round the product to the next lower dime.
2
Subtract from this amount the new post-COLA Social Security standard SMIB deduction and round the result to the next lower dollar.
3
Add back the SMIB deduction.
Result:  The amount is considered the new monthly Social Security payment to determine IVAP.

X.2.2.f.  Nonstandard SMIB Deductions

If the pre-COLA SMIB is other than the current standard amount, the post-COLA Social Security monthly amount is estimated using the pre-COLA SMIB.
The assumption is made that there would be no change in the SMIB deduction because there is no way to estimate the post-COLA nonstandard SMIB deduction.

X.2.2.g.
SMIB Deduction Savings Provision

The standard SMIB deduction increase can be more than the COLA.  As a result, Social Security recipients at the lower end of the benefit scale would see their benefits increase less than the amount of the increase in the SMIB deduction and would end up with a net reduction in benefits.  The law includes a provision that Social Security recipients will not be reduced solely because of the COLA.
Therefore, in cases where the newly increased SMIB deduction would be greater than the COLA increase, the Medicare deduction is automatically reduced to the extent necessary to prevent a reduction in the beneficiary’s monthly rate of Social Security.

X.2.2.h.  Example:  Determining SMIB Deduction

Situation:
  • A Veteran’s gross pre-COLA Social Security rate is $326.00 and includes a $54.00 SMIB deduction.
  • The Veteran’s monthly payment amount is $272 ($326.00 – 54.00).
  • After the COLA adjustment, the gross rate increases to $330.50.
  • When the new SMIB deduction of $58.70 is subtracted from the gross rate, the Veteran’s check amount decreases to $271.80.
Result:  Since the payment amount cannot be reduced, the SMIB deduction must be reduced to $58.50 to continue paying $272 ($330.50 – $58.50 = $272.00).

 

3.  Processing Verified Social Security Amounts


Introduction

This topic contains information on processing verified Social Security amounts, including

Change Date

August 8, 2016

X.2.3.a.
SSA Action

After matching VA extracts against their files, the SSA returns the files with current Social Security payment information to VA.

X.2.3.b.  Verification Attempts

For each pension record, verification is attempted for
  • the Veteran’s Social Security entitlement under his/her Social Security number (SSN), and
  • a spouse’s entitlement under the Veteran’s SSN and under the spouse’s SSN.

X.2.3.c. Survivors Pension and Parents’ DIC Cases

For Survivors Pension and Parents’ DIC cases, verification is attempted under the Veteran’s SSN and the payee’s SSN.
Child Payees
Records for child payees receiving pension are included in the procedure, but no attempt is made to verify the entitlement of a dependent child on a Veteran’s or surviving spouse’s record.

X.2.3.d. Corrective Award Action Necessary Based on SSA Matches

Depending on the discrepancies found between the SSA information and VA computed post-COLA Social Security rate and on the type of VA benefits payable, the VA systems either
  • update the master record income, or
  • creates an EP 696 in the corporate system that requires a corrective award action is apparently necessary.

 

4.  Processing Verified Social Security Amounts:  Old-Law and Section 306 Cases


Introduction

This topic contains information on processing verified Social Security amounts in Old-Law and Section 306 cases, including

Change Date

August 8, 2016

X.2.4.a.
Old-Law and Section 306 Cases

In all Old-Law and Section 306 cases for which verified Social Security data are available,  The VA system
  • posts the verified Social Security amount to the INCOME/NET WORTH screen
  • posts the SMIB deduction amount to the INCOME/NET WORTH screen, and
  • computes and posts the new monthly and annual Social Security income amounts for Veterans, spouses, and surviving spouses.

X.2.4.b.  Audits of Protected Pension Cases After SSA Matches

The VA system does not generate review messages in protected pension cases merely because there are discrepancies between the Social Security amounts returned by the SSA and the existing amounts in the master record (the amount in the master record is the VA computed post-COLA Social Security rate).
Reported Death of Beneficiary or Spouse
The only other review messages issued during initial processing of SSA returns for protected pension cases are related to the reported death of a beneficiary or spouse.

5.  Processing Verified Social Security Amounts:  Current-Law Pension and Parents’ DIC Cases


Introduction

This topic contains information on processing verified Social Security amounts for curent-lae pension and Parents’ DIC cases, including

Change Date

August 8, 2016

X.2.5.a.  Current-Law Pension and Parents’ DIC

In each curent-law pension and Parents’ DIC case for which verification is possible for a payee and/or spouse, the system compares the monthly Social Security income computed from the returned SSA data with the existing monthly Social Security income of record.

X.2.5.b.
Post-COLA Social Security Amount Equals Master Record Amount

If the post-COLA Social Security monthly amount equals the master record monthly amount, no further action is taken except to update the verified monthly rate and smib deduction fields, if necessary.

X.2.5.c.  Legend for Payee/Spouse Discrepancy

The legend for a payee’s discrepancy is SSA REPORTS, or spouse’s discrepancy is SSA RPTS SPOUSE, or both, if applicable.
The amount shown is the monthly Social Security income computed from the SSA verified monthly entitlement amount.
This monthly Social Security income is
  • not posted to the M/R RATE field on the INCOME/NET WORTH screen, but
  • posted to the ver rate field on the INCOME/NET WORTH screen.

X.2.5.d.
SMIB Deduction

When there is a SMIB deduction, the actual amount is also shown on the INCOME/NET WORTH Screen in the SMIB field.

X.2.5.e.
No Medicare Deduction in a Verified Case

When there is no Medicare deduction in a verified case, the SMIB field is blank.
Therefore, if the INCOME/NET WORTH screen shows a positive entry in the VER RATE field for Social Security and a blank in the SMIB field, the SMIB deduction amount for that SSA beneficiary was verified as none.

X.2.5.f.  Verified Rate

The verified rate is the amount called MBA (monthly benefit amount) by the SSA and represents the gross entitlement (unrounded) amount.

X.2.5.g.
SMIB field

The SMIB field represents the SMIB deduction.  The verification program also computes a verified post-COLA monthly Social Security income amount.

X.2.5.h. Example: Determining Verified Monthly Social Security Amount

Situation:
  • Assume a case where the verified rate was $386.40 and the SMIB amount was $58.70.
  • Subtracting SMIB ($58.70) from the verified rate ($386.40) leaves $327.70.
  • Dropping the cents gives $327.
Result:  Adding the SMIB ($58.70) to $327 gives $385.70 as the verified monthly Social Security amount.

X.2.5.i.  Verifying Monthly Social Security Amount

Check Share or call SSA to verify the monthly Social Security amount.  Unless it is known that SMIB is paid by a state or organization, use the amount in the message legend.

X.2.5.j.
Social Security Income within $10 of M/R RATE Field

If the verified computed monthly Social Security income is within $10 of the amount in the INCOME/NET WORTH RATE field
  • do not adjust the case
  • do not take end product (EP) credit, and
  • dispose of the work item under RCS VB-1, Part I, item no. 8-041.000.

X.2.5.k.
Social Security Income Exceeds or Is Less than M/R RATE Field by $10

If the verified computed monthly Social Security income exceeds or is less than the amount in the INCOME/NET WORTH RATE field by $10 or more check the Share system or call SSA for the correct rate.

X.2.5.l.  Developing for Date of Rate Change

Initiate development with the payee to determine the commencing date of the SSA rate change.

X.2.5.m. Informing the Payee

Tell the payee he/she has been identified by SSA through the matching program as receiving SSA benefits at a rate which differs from the rate on which his/her VA benefits are paid.
Provide notice of proposed adverse action as outlined in M21-1, Part I, 2.B.6, if the verified Social Security rate will result in a reduction or termination of benefits.  Advise the payee of the monthly Social Security rate
  • that SSA has reported, and
  • on which VA benefits are paid.
Ask the payee to
  • explain the discrepancy between the amount verified by SSA and the amount previously reported to VA, and
  • submit copies of award letters and adjustment notices for all periods necessary to resolve the discrepancy.

X.2.5.n.  Monthly Entitlement Amount Is Erroneous

If development or a review of the folder clearly establishes that a verified monthly entitlement amount is erroneous, process a correction of master record transaction of six zeros to the appropriate ver rate field.

X.2.5.o.
No Response or Inadequate Response by Payee

If the payee fails to respond or the response is inadequate, adjust the award under38 CFR 3.652.
Note:  For purposes of 38 CFR 3.652(a)(1), the “month in which the eligibility factor was last shown by the evidence of record to have existed” is the last month in which it can be definitely be shown by the evidence that the payee’s income did not exceed the income limitation for payment of pension benefits.

 

6.  Action on Terminated SSA Accounts


Introduction

This topic contains information on terminated SSA accounts, including

Change Date

July 31, 2015

X.2.6.a.  Beneficiary or Spouse Deceased

Code 833 messages are also issued for cases in which the SSA records indicate that a VA beneficiary or the spouse of a VA beneficiary is deceased.
The following are the two code 833 messages that are issued for these cases:
  • SSA RPTS PAYEE DECEASED, and
  • SSA RPTS SPOUSE DECEASED.

X.2.6.b.
SSA Reports Payee Deceased

The message SSA RPTS PAYEE DECEASED is issued for a record that is in active payment status at the time of the verification run.  This message is keyed to certain coded fields in the SSA record.  It is possible that the codes are neither accurate nor current.
Notes:
  • If there is no evidence on file to support the validity of the message, do not suspend the account while undertaking initial development.  Rather, maintain control of the case while taking development action to determine the fact and date of death, and
  • suspend payments, pending ultimate adjustment, only if the evidence indicates a reasonable probability that the payee is deceased.

X.2.6.c.
SSA Reports Spouse Deceased

The message SSA RPTS SPOUSE DECEASED is issued for an appropriate record if there is a spouse indicated in the master record and there is no future award line on or before January, showing total dependency reduced to indicate loss of the spouse.
Note:  Control such cases and take appropriate development action to determine current dependency status and the date of loss of the spouse.  The effective date of award adjustment will be dictated by the end-of-month rule or end-of-year rule, depending on the type of VA benefits payable and the actual date of the spouse’s death.

 

7.  EP Credit, Reporting, and Cost Avoidance


Introduction

This topic contains information on EP credit, reporting, and cost avoidance, including

Change Date

April 5, 2005

X.2.7.a.  EP Assignment

EP 150
Cases which require development and/or award action because of an income adjustment are assigned EP 150.
EP 130
Cases which require development and/or award action because of a change in dependency are assigned EP 130.
Note:  No separate end product credit is assigned to develop for or terminate an account based on the fact of a Veteran’s death, as appropriate credit is included in any subsequent death action.
Reference:  For more information on EP credit, see M21-4 Appendix B.

X.2.7.b.  Report Format

RCS 20-0846 reports are required in the following format:
  • number of overpayments created
  • amount of overpayments
  • number of cases referred under M21-1, Part III, Subpart vi, 5.A, and
  • fiscal year cost avoidance in cases that are terminated or reduced as a result of this matching program.
Important:  Negative reports are required.
Note:  Regional offices (ROs) will be informed annually of the date this report is due and where to send the report.

X.2.7.c. Determining Fiscal Year Cost Avoidance

Fiscal year cost avoidance is calculated as follows:
  • multiply the pre-adjustment rate by the number of months remaining in the fiscal year from the first of the month of adjustment
  • multiply the new monthly rate by the same number of months, and
  • subtract the revised rate from the initial rate.
The result is the fiscal year cost avoidance.

X.2.7.d.  Example:  Determining Cost Avoidance

Situation:  The Social Security verification match indicates that a single Veteran’s monthly Social Security rate is $447.50 effective December 1, 1999.  The Veteran is currently being charged with Social Security of $420.50 per month effective December 1, 1999.
After affording a notice of proposed adverse action, the RO determines that the award must be adjusted to charge SocialSecurity of $477.50 per month from July 1, 1999.  The award making the adjustment is authorized on August 7, 2000.  The difference between the monthly rate that would have been paid based on Social Security of $420.50 and the rate actually paid after the adjustment based on Social Security of $447.50 per month, is $27.00 per month.
Action:  The lower rate will be paid for two months that remain in fiscal year 2000 (August and September).  Therefore, fiscal year cost avoidance for this case for purposes of the RCS-20-0846 report is $54 ($27.00 x 2).
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