Proposed Rule2024-02961
Use of Electronic Payroll Data To Improve Program Administration
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
February 15, 2024
Issuing agencies
Social Security Administration
Abstract
Section 824 of the Bipartisan Budget Act of 2015 (BBA) authorizes the Commissioner of Social Security to enter into information exchanges with payroll data providers to obtain wage and employment information. We use wage and employment information to administer the Old-Age, Survivors, and Disability Insurance (OASDI) disability and Supplemental Security Income (SSI) programs under titles II and XVI of the Social Security Act (Act). We are proposing these rules pursuant to section 824 of the BBA, which requires us to prescribe, by regulation, procedures for implementing the access to and use of the information held by payroll data providers. We expect these proposed rules will support proper use of information exchanges with payroll data providers that will help us administer our programs more efficiently and prevent improper payments under titles II and XVI of the Act, which can otherwise occur when we do not receive timely and accurate wage and employment information.
Full Text
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<title>Federal Register, Volume 89 Issue 32 (Thursday, February 15, 2024)</title>
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[Federal Register Volume 89, Number 32 (Thursday, February 15, 2024)]
[Proposed Rules]
[Pages 11773-11788]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-02961]
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Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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Federal Register / Vol. 89, No. 32 / Thursday, February 15, 2024 /
Proposed Rules
[[Page 11773]]
SOCIAL SECURITY ADMINISTRATION
20 CFR Parts 404, 416, and 422
[Docket No. SSA-2016-0039]
RIN 0960-AH88
Use of Electronic Payroll Data To Improve Program Administration
AGENCY: Social Security Administration.
ACTION: Notice of proposed rulemaking.
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SUMMARY: Section 824 of the Bipartisan Budget Act of 2015 (BBA)
authorizes the Commissioner of Social Security to enter into
information exchanges with payroll data providers to obtain wage and
employment information. We use wage and employment information to
administer the Old-Age, Survivors, and Disability Insurance (OASDI)
disability and Supplemental Security Income (SSI) programs under titles
II and XVI of the Social Security Act (Act). We are proposing these
rules pursuant to section 824 of the BBA, which requires us to
prescribe, by regulation, procedures for implementing the access to and
use of the information held by payroll data providers. We expect these
proposed rules will support proper use of information exchanges with
payroll data providers that will help us administer our programs more
efficiently and prevent improper payments under titles II and XVI of
the Act, which can otherwise occur when we do not receive timely and
accurate wage and employment information.
DATES: To ensure that your comments are considered, we must receive
them no later than April 15, 2024.
ADDRESSES: You may submit comments by any one of three methods--
internet, fax, or mail. Do not submit the same comments multiple times
or by more than one method. Regardless of which method you choose,
please state that your comments refer to Docket No. SSA-2016-0039 so
that we may associate your comments with the correct rule.
Caution: You should be careful to include in your comments only
information that you wish to make publicly available. We strongly urge
you not to include in your comments any personal information, such as
Social Security numbers or medical information.
1. Internet: We strongly recommend that you submit your comments
via the internet. Please visit the Federal eRulemaking portal at
<a href="https://www.regulations.gov">https://www.regulations.gov</a>. Use the Search function to find docket
number SSA-2016-0039. The system will issue a tracking number to
confirm your submission. You will not be able to view your comment
immediately because we must post each comment manually. It may take up
to a week for your comment to be viewable.
2. Fax: Fax comments to 1-833-410-1631.
3. Mail: Mail your comments to the Office of Legislation and
Congressional Affairs, Regulations and Reports Clearance Staff, Social
Security Administration, Mail Stop 3253 Altmeyer, 6401 Security
Boulevard, Baltimore, Maryland 21235-6401.
Comments are available for public viewing on the Federal
eRulemaking portal at <a href="https://www.regulations.gov">https://www.regulations.gov</a> or in person, during
regular business hours, by arranging with the contact person identified
below.
FOR FURTHER INFORMATION CONTACT: Nicole Dunham, Policy Analyst, Office
of Supplemental Security Income and Program Integrity Policy, Social
Security Administration, 6401 Security Boulevard, Baltimore, Maryland
21235-6401, (410) 966-9078. For information on eligibility or filing
for benefits, call our national toll-free number, 1-800-772-1213, or
TTY 1-800-325-0778, or visit our internet site, Social Security Online,
at <a href="https://www.socialsecurity.gov">https://www.socialsecurity.gov</a>.
SUPPLEMENTARY INFORMATION:
Background
We administer the OASDI disability and SSI programs under titles II
and XVI of the Act, respectively. The OASDI program pays benefits to
individuals who meet certain requirements, including those who are
disabled and insured for disability.\1\ OASDI also pays benefits to
certain members of disabled individuals' families.\2\ We refer to
meeting the requirements for OASDI disability benefits as OASDI
disability ``entitlement.'' The SSI program provides financial support
to: (1) adults and children with a disability or blindness; and (2)
adults aged 65 and older. These individuals must meet all program
eligibility requirements, including having resources and income below
specified amounts.\3\ We refer to meeting the factors of eligibility
for SSI payments as SSI ``eligibility.''
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\1\ See 20 CFR 404.315 for a full list of the OASDI disability
eligibility requirements.
\2\ This can include, for example, a child of the disabled
individual, a child of the disabled individual entitled to an adult
child disability benefit, a spouse caring for a minor or disabled
child of the disabled individual, or retirement benefits for a
spouse age 62 or older of the disabled individual. See 20 CFR
404.330, 404.350, 404.351.
\3\ See 20 CFR 416.202 for a full list of the SSI eligibility
requirements.
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We take seriously our responsibilities to ensure eligible
individuals receive the benefits to which they are entitled and to
safeguard the integrity of benefit programs to better serve our
customers. Our commitment includes working to ensure we have accurate
wage data as quickly as practicable to avoid overpayments before they
occur or correct them quickly.
We use wage and employment information to decide who can receive
OASDI disability benefits and SSI payments. We also use it to determine
SSI payment amounts. Receiving complete, accurate, and timely wage and
employment information allows us to administer our programs efficiently
and to avoid improper payments that can occur when we do not have such
information. Reviews of post-entitlement cases show that substantial
gainful activity (SGA) \4\ continues to be the leading cause of
overpayments in the OASDI disability program. In fact, SGA-related
overpayments in the OASDI program averaged approximately $500 million
annually as of fiscal year 2022.\5\ Further, wage discrepancies,
[[Page 11774]]
which reached an annual average of approximately $1.4 billion in
improper payments as of fiscal year 2022, have been a leading cause of
improper payments in the SSI program for more than a decade.\6\
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\4\ A requirement for disability for both OASDI disability and
SSI is that you cannot be engaged in SGA, which is defined as work
that involves significant and productive physical or mental duties,
and is done, or intended to be done, for pay or profit. 20 CFR
404.1510, 404.1520(b), 416.910, 416.920(b).
\5\ FY2023 Agency Financial Report, page 180, available at
<a href="https://www.ssa.gov/finance/2023/Full%20FY%202023%20AFR.pdf">https://www.ssa.gov/finance/2023/Full%20FY%202023%20AFR.pdf</a>.
Beneficiaries' failure to report earnings in a timely manner
accounted for 82 percent of SGA-related improper payments and our
failure to take the proper actions to process work reports accounted
for the remainder.
\6\ Id. at 184 and 185. Wage discrepancies occur when the
recipient or their deemor has actual wages that differ from the wage
amount we used to calculate the SSI payment, either because the
recipient failed to report a change, or we failed to make changes to
payments in a timely manner.
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Currently, we rely on individuals to report certain wage and
employment information to us. Individuals who are entitled to OASDI
disability must report to us when their condition improves, when they
return to work, when they increase the amount they work, and when their
earnings increase.\7\ Individuals who are eligible for SSI based on
disability or blindness must make similar reports.\8\ All SSI
recipients and deemors \9\ must also report to us any change in income
\10\ as soon as a reportable event happens.\11\ For OASDI disability
and SSI, they can report these changes by phone, fax, mail, in
person,\12\ or by using mySocialSecurity. In many cases, SSI recipients
may also report wages through the SSA Mobile Wage Reporting (SSAMWR)
application and the SSI Telephone Wage Reporting (SSITWR) system. We
may also request this information from the employer(s) or payroll data
providers when the information we receive is incomplete or we are
unable to obtain it from the individual. Because many individuals work
in jobs where earnings may vary from week to week, some individuals
report these changes to us each month or more frequently. In FY 2022,
we received 1.1 million wage reports \13\ for individuals who received
OASDI disability or OASDI disability and SSI concurrently, and who were
in current pay status (this does not include SSI only wage reports).
Though we strive to make reporting as easy as possible, individuals
must keep track of their reportable events, report them as soon as they
happen, and spend time making the reports, which can be burdensome.\14\
We estimate that there are about 1,100,000 OASDI disability
beneficiaries, between 200,000 and 300,000 SSI recipients, and another
500,000 to 600,000 deemors of SSI recipients who work in a given year.
Despite the many reporting options, we do not always receive complete
or timely reports. Even when we receive complete reports, we may still
need to verify them with independent or collateral sources when we do
not have proper wage evidence to verify the report, such as a paystub.
Currently, to verify wage reports, we conduct a manual query,
requesting records from payroll data providers, and sometimes
employers, on a case-by-case basis. This is time-consuming, prolongs
the resolution of the case, and adds to our workloads. An automated
information exchange would allow us to obtain this information more
efficiently because it could automatically process large numbers of
queries at once.
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\7\ See 20 CFR 404.1588(a). We require reporting an increase in
work or earnings because that may indicate the beneficiary has
performed SGA (see 20 CFR 404.1572 and 404.1574) and will no longer
be entitled to an OASDI disability benefit (20 CFR 404.1520(b)).
\8\ See 20 CFR 416.988. As with OASDI disability, we require
these reports because they may indicate SGA (see 20 CFR 972 and
416.974), which may affect SSI eligibility (20 CFR 416.920(b)).
\9\ A deemor is any person whose income or resources are
material to determining the eligibility of someone filing for or
receiving SSI. 20 CFR 416.1160; SI 01310.127.
\10\ See 20 CFR 416.708(c). Income in our SSI regulations is a
broad term that includes ``anything you receive in cash or in kind
that you can use to meet your daily needs for food and shelter.''
See 20 CFR 416.1102. One type of income is wages, which are divided
into two categories: wages paid in cash and wages paid in kind. See
20 CFR 416.1110. Wages paid in cash may include salaries,
commissions, bonuses, severance pay, and any other special payments
received because of employment. Id.
\11\ See 20 CFR 416.714.
\12\ When we receive reports by phone, fax, mail, or in person,
our technicians process them manually. Manual processing by
technicians includes calculating the total wage amount for the
month, posting the amount to the record, and providing a receipt to
the customer. Electronic methods of reporting accept wage reports on
any day during the reporting month. Wage reports submitted by
electronic methods are automatically posted to the record and the
payment is adjusted accordingly.
\13\ A ``wage report'' is anytime SSA becomes aware of wages,
whether through self-reporting (mail, fax, office visit, or a self-
report through an electronic method), third party data provider, IRS
annual wage data, or State reported wage data.
\14\ To be considered in time to process a particular month's
payment, SSI recipients or their representative payees must report
income changes within the first ten days of the month following the
month of change (20 CFR 416.714). Receiving this information earlier
in the month allows us more time to calculate the correct payment,
send a Notice of Planned Action (NOPA) when an adverse action
applies, and adjust benefits for the following month. If a change is
reported after the first ten days of the month and the change
results in a change in the recipient's payment amount, then it is
likely that we will not be able to adjust benefits for the following
month, resulting in an overpayment or underpayment.
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As we discuss later in this proposed rule, when individuals become
eligible for reduced reporting responsibilities, we would no longer
burden them with frequent reporting of certain wage information. They
would no longer need to keep track of certain reportable events, report
them as soon as they happen, and spend time making the reports.
Further, we would no longer need to burden employers with requests for
this information. As discussed in the regulatory analysis section, we
project that identifying overpayments more quickly will reduce the
quantity and size of overpayments, benefitting both recipients and
employers, and better fulfill our stewardship obligations.
Section 824 of the BBA and the Proposed Automated Process
Section 824 of the BBA \15\ authorizes the Commissioner of Social
Security to enter into information exchanges with payroll data
providers \16\ to obtain wage and employment information. It authorizes
these information exchanges for the purposes of efficient program
administration and to prevent improper OASDI disability and SSI
payments \17\ without the need for verification by independent or
collateral sources.\18\ Section 824 adds a new section 1184 to the Act
and also adds language to sections 225 and 1631(e) of the Act \19\ to
clarify the role that information exchanges will play in determining
payment amount and making eligibility and entitlement determinations
and decisions for the OASDI disability and SSI programs.
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\15\ Public Law 114-74, 129 Stat. 584, 607.
\16\ ``Payroll data providers'' include payroll providers, wage
verification companies, and other commercial or non-commercial
entities that collect and maintain information regarding employment
and wages. 42 U.S.C. 1320e-3(c)(1).
\17\ Under 42 U.S.C. 1320e-3(a)(1) the information exchange is
limited to disability insurance beneficiaries (those under
subsections (d)(1)(B)(ii), (d)(6)(A)(ii), (d)(6)(B), (e)(1)(B)(ii),
and (f)(1)(B)(ii) of section 202 and subsection (a)(1) of section
223) and supplemental security income benefits under title XVI. The
law does not allow us to use the information exchange to obtain wage
information for other beneficiaries under Title II (e.g.,
individuals who continue to work while receiving old-age benefits).
\18\ 42 U.S.C. 1320e-3(a). ``Information exchanges'' are the
automated comparison of our system(s) of records with information of
payroll data providers. 42 U.S.C.. 1320e-3(c)(2).
\19\ 42 U.S.C. 425, 1320e-3, and 1383(e).
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As discussed above, we require wage and employment information to
administer the OASDI disability and SSI programs. An information
exchange would allow us to automate the process of obtaining and
recording the wage and employment data we receive from a payroll data
provider through the information exchange to the appropriate OASDI
disability and SSI systems records.\20\ We will use this information
[[Page 11775]]
to efficiently administer OASDI and SSI benefits, including adjusting
payment amounts and making entitlement or eligibility determinations
for the OASDI disability and SSI programs based on the information we
receive from a payroll data provider. We will also use this information
to avoid making improper payments of those benefits.
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\20\ Implementation of the information exchange will not affect
our quarterly data-matches with the National Directory of New Hires
(NDNH) or our annual match with the Master Earnings File, both which
supply us with limited wage data. The NDNH is a federally mandated
national repository of employment, unemployment insurance, and
quarterly wage information submitted by state directories of new
hires, state workforce agencies, and Federal employers. The Master
Earnings File contains data derived from IRS Form W-2, quarterly
earnings records, and annual income tax forms. These data include
regular wages and salaries, tips, self-employment income, and
deferred compensation (contributions or distributions).
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Advantages of Using Information Exchanges With Payroll Data Providers
We expect that receiving monthly wage and employment information
for our claimants, beneficiaries, recipients, and deemors \21\
automatically through an information exchange with a payroll data
provider who provides sufficiently accurate, up-to-date, and complete
information will improve payment accuracy. It will also reduce improper
payments that occur when we do not receive wage or employment reports
timely (although, as indicated in the E.O. 12866 analysis section, we
do not estimate the reduction in improper payments). Further, this
process would reduce the burden of self-reporting on individuals who
authorize us to obtain wage and employment information from a
participating payroll data provider and we receive their wage and
employment information from their employer through an information
exchange. Additionally, individuals who provide authorization would not
be subject to certain penalties under section 1129A of the Act \22\ for
any omission or error with respect to wages reported by a participating
payroll data provider (in FY 2022 we performed 54 cases of
administrative sanctions in the SSI program and 82 administrative
sanctions in the Social Security Disability Insurance (SSDI) program;
in FY 2023 it was 59 cases and 24 cases, respectively). We define a
participating payroll data provider as a payroll data provider that has
an information exchange arrangement with us to provide wage and
employment information.
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\21\ As explained above, a deemor is any person whose income or
resources are material to determining the eligibility of someone
filing for or receiving SSI. 20 CFR 416.1160; SI 01310.127.
\22\ 42 U.S.C. 1320a-8a. See also 20 CFR 404.459 and 416.1340.
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We anticipate that implementation of an information exchange would
result in more efficient use of our limited administrative resources.
If we receive wage and employment information through an information
exchange with a participating payroll data provider, our technicians
can reduce the amount of time spent manually requesting this
information from payroll data providers and employers, manually
entering data into our systems from an individual's pay records,
contacting individuals, and assisting individuals with the results of
incomplete or untimely reporting.
Solicitation for Payroll Data Provider
In May 2019, we solicited proposals for payroll providers using
full and open competition in accordance with Federal Acquisition
Regulations (FAR) Part 15. As stated in our solicitation, we based our
award decision on a trade-off process (best value), considering both
price and non-price factors.\23\
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\23\ In accordance with FAR Subpart 15.101-1(a), a trade-off
process is appropriate when it may be in the best interest of the
Government to consider award to other than the lowest priced offeror
or other than the highest rated offeror. The non-price factors
(listed in descending order of importance) used were: 1. Technical
approach, 2. Corporate experience, and 3. Past performance. The
solicitation stated factors 1, 2, and 3 when combined were
approximately equal in importance to price.
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Equifax Workforce Solutions (Equifax) was the only payroll provider
to respond to our solicitation. We evaluated the proposal against the
evaluation criteria listed above, which consisted of technical
approach, corporate experience, past performance, and price. The
Technical Evaluation Committee \24\ determined the Non-Price Proposal
to be acceptable and assigned favorable ratings for the three non-price
factors. The Contracting Officer evaluated the Business Proposal (i.e.,
price proposal) and determined the proposed prices were fair and
reasonable according to FAR 15.404-1(b) and the terms of the
solicitation. In September 2019, the agency awarded the Payroll
Information Exchange contract to Equifax, as we determined Equifax
offered the best value to the government, all factors considered.\25\
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\24\ The Technical Evaluation Committee supports the source
selection for the acquisition. It is typically comprised of no more
than three individuals with the appropriate technical expertise to
evaluate proposals in accordance with the solicited evaluation
factors.
\25\ We published notice of our information exchange with
Equifax, pursuant to section 824 of the BBA, on January 19, 2021. 86
FR 5303.
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Accuracy Study
We conducted an accuracy study \26\ of data we received from
Equifax through a database known as The Work Number.\27\ Equifax
reports that The Work Number covers over two-thirds of non-farm
payroll, although neither SSA nor Equifax has analyzed whether working
disability benefit recipients are represented in a similar proportion
in the database. This study compared wage and employment information we
received from Equifax to wage and employment information we obtained
from paystubs that users uploaded to the SSAMWR application, an online
wage reporting tool currently available to SSI recipients, deemors, and
their representative payees. We identified about 40,000 samples from
March 2022 through September 2022 where both Equifax and SSAMWR had
information on the same paystub for the same employee, employer, and
time period.\28\ We then compared the information that Equifax and
SSAMWR had for these paystubs using the following four variables: pay
period start date, pay period end date, pay date, and gross earnings
amount.
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\26\ The study, ``Evaluation of Payroll Information Exchange
(PIE) Wage Data Accuracy,'' is available in the rulemaking record at
<a href="http://www.regulations.gov">www.regulations.gov</a> as a supporting document for Docket SSA-2016-
0039.
\27\ We performed a limited period of exchanges through
September 2022 with Equifax. We used this data to test systems we
created to receive, interpret, and incorporate the data Equifax
sent. We were also able to use this data to perform this accuracy
study.
\28\ The sampling choices limit the types of conclusions that
can be drawn about the accuracy of Equifax's data across the entire
covered population. For example, if Equifax reports payroll
information on an individual who was not working during a pay
period, such an error would lower the true accuracy of using the
Equifax database but would not be identified in this study.
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We evaluated the accuracy through two steps. First, we matched
seven months of information exchange records to SSAMWR based on SSN and
pay periods as identified by the variables pay period start date, pay
period end date, and pay date. Of the roughly 40,000 records with SSNs
in both datasets, we found that 80.43% exactly matched both gross
earning and all date fields. In 13.35% of the cases all dates matched
but gross earnings did not. In the remainder of the cases there were
iterations of partial earnings matches but with inaccurate dates.
To study the cause of the 7,976 cases with matching errors, our
second step was to randomly sample 4% (341) and manually review the
cases. We first found that a large source of gross earnings match
errors between information exchange data and SSAMWR were due to optical
scanning inaccuracies from our SSAMWR file compared with the actual
photo of the paystub the beneficiary had uploaded to SSAMWR. To further
determine the accuracy of information exchange-reported data, we
compared the information exchange data against actual images of the
paystubs which
[[Page 11776]]
were submitted in SSAMWR. Through this process, we determined that in
77.4% of the sampled cases,\29\ all dates and gross earnings matched
between the information exchange and the true paystub.
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\29\ The 95 percent confidence interval for this estimate had a
lower bound of 73.0 percent and an upper bound of 81.8 percent.
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By extrapolating this sample to the broader set of 7,976 cases
where there were initial mismatches between information exchange
records and SSAMWR, we concluded that in 95.6 percent \30\ of the
original roughly 40,000 cases, all four variables matched between the
actual paystub and the information exchange record. Although some data
differed in 4.4 percent of these cases between Equifax and SSAMWR, the
study did not determine whether the differences would have affected our
benefit determinations. For example, one of the pay period variables we
evaluated, pay period start date, would have no discernable impact on
benefit determinations.\31\ While some other variable inconsistencies
likewise may have had little or no impact on benefit determinations,
potential errors related to total pay (such as over- or under-reporting
actual income) could result in us initiating an action to change
benefit amount.\32\
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\30\ The 95 percent confidence interval for this estimate had a
lower bound of 94.7 percent and an upper bound of 96.5 percent.
\31\ The pay period start date obtained through this exchange is
not used for benefit determinations. For OASDI disability
determinations, we use pay period end date, gross earnings, and
sometimes pay date. For SSI determinations, we use only the pay date
and gross earnings. When we removed the pay period start date
variable from the study data, the match rate increased from 95.6
percent to 97.1 percent.
\32\ Regarding the sample of cases that did not match on gross
earnings, representing roughly half of the 4.4 percent of mismatched
data, the study did not determine, for example, whether the mismatch
in gross earnings was a significant difference that would result in
an incorrect benefit determination. Mismatched earnings may not
impact benefit eligibility or amounts if the earnings are below
relevant thresholds or not relevant to the calculation based on when
they are paid (for SSI) or earned (for OASDI disability). The study
did not determine how mismatched cases impacted benefit
determinations. Also, the study only looked at single instances of
paystubs and not the full monthly earnings amount. Therefore, the
study was unable to determine the true impact of those inaccuracies.
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Based on the results of this accuracy study, we are confident the
information exchange will supply the accurate wage and employment
information we need to make benefit determinations in most
circumstances.
Requirements of Section 824 of the BBA
Section 824(d) of the BBA \33\ requires us to publish regulations
prescribing procedures for implementing the access and use of the
information held by payroll data providers, including: (1) guidelines
for establishing and maintaining information exchanges with payroll
data providers, pursuant to section 1184 of the Act; (2) beneficiary
authorizations; (3) reduced wage reporting responsibilities for
individuals when they authorize us to access information held by
payroll data providers through an information exchange; and (4)
procedures for notifying individuals in writing when they become
subject to such reduced wage reporting requirements and when such
reduced wage reporting requirements no longer apply to them. We discuss
each of these four items below.
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\33\ Public Law 114-74, 129 Stat. 584, 610.
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1. Guidelines for Establishing and Maintaining Information Exchanges
With Payroll Data Providers
As discussed above, we need wage and employment information to
decide who can receive OASDI disability benefits and SSI payments and
to determine SSI payment amounts.\34\ Although individuals are required
to report this information to us, they do not always report it to us
timely or provide complete information. As required by section 824 of
the BBA, we propose to prescribe guidelines for establishing and
maintaining an information exchange.
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\34\ Section 824 of the BBA also permits us to obtain wage and
employment information from a participating payroll data provider
for the purpose of making OASDI disability benefit amount
determinations. 42 U.S.C. 1320e-3(b)(1)(A). Currently, we do not use
wage and employment information from a payroll data provider for
OASDI disability benefit amount determinations.
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To establish an information exchange, we will identify the payroll
data providers (as defined in proposed Sec. Sec. 404.702 and 416.702)
that may be interested in participating in an information exchange with
us. Before we establish an information exchange with a payroll data
provider, we will consider such factors as the provider's ability and
willingness to: engage in an information exchange; provide us with wage
and employment information that includes all necessary data elements
needed to make program determinations and payment amount decisions; and
provide data that is sufficiently accurate,\35\ complete,\36\ and up-
to-date.\37\ We will also consider and evaluate any conditions and
limitations associated with our receipt of the data.
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\35\ By ``accurate'' we mean that the exchange supplies the
correct wage and employment information received for the requested
individual.
\36\ By ``complete'' we mean the wage and employment information
received from the participating payroll data provider contains all
the required data elements necessary for us to make determinations
and decisions regarding entitlement under title II of the Act. and
eligibility and payment amounts under title XVI of the Act. We note
that, in cases in which our current participating payroll data
provider cannot supply all the wage and employment information we
require to make benefit determinations, we investigate further to
gather additional information.
\37\ By ``up-to-date'' we mean the latest wage and employment
information received from the payroll data provider each month. For
example, our current participating payroll data provider makes wage
and employment information available within 24 hours of receipt from
employers.
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Any arrangement with a selected payroll data provider will
describe: the records to be matched; the procedure for conducting the
match; any requirements established relating to ensuring records are
accurate, complete, and up-to-date; procedures for ensuring the
administrative, technical, and physical security of the records
matched; and such other provisions as are necessary. Further, before we
enter into an information exchange,\38\ we will publish a notice in the
Federal Register describing the information exchange,\39\ including our
assessment that the information received through the exchange is
relevant and necessary to administer our programs and an explanation
for why the information is sufficiently accurate, complete, and up-to-
date. Receiving accurate, complete, and up-to-date, information from an
information exchange is necessary to allow us to decide claims earlier
and avoid improper payments that may arise from untimely, incomplete,
or missing wage and employment reports.
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\38\ We have interpreted this to mean before implementing an
information exchange by data sharing, which would occur after
establishing an arrangement with a payroll data provider (e.g.,
contract) to develop the exchange.
\39\ On January 19, 2021, we published a notice in the Federal
Register that provided advance notification to the public regarding
an information exchange we established with Equifax (86 FR 5303). To
date, that is the only information exchange we have established
under section 824 of the BBA.
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Once we enter into an information exchange with a payroll data
provider, we will maintain the information exchange by periodically
assessing whether the data we receive continues to be accurate,
complete, and up-to-date. We will also monitor compliance with the
requirements of the information exchange.
2. Beneficiary Authorizations
When an individual applies for benefits under OASDI disability or
SSI, we will request authorization from the individual to obtain their
wage and employment information from a payroll data provider.\40\ We
will also ask for
[[Page 11777]]
authorization during other post-entitlement events, such as a
redetermination for SSI. Although we have not started using payroll
data, in anticipation of implementing the information exchange, we
began collecting authorizations in late 2017 (which we currently
collect via paper form or through attestation).\41\ In the future, we
could accept authorization electronically. For OASDI disability, we
request authorization from individuals who apply for or are entitled to
benefits.\42\ For SSI, we request authorization from individuals who
apply for or receive SSI, as well as deemors, ineligible children, and
individuals who turn age 18.\43\ An authorization applies to all
pending and approved claims under the specific program until the
authorization is revoked or terminated.
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\40\ The law allows SSA to require the authorization. SSA has
decided that we will request this authorization on a voluntary
basis, and that there will be no automatic assumption of inclusion
without obtaining prior authorization. Under the law, individuals
may refuse to provide this authorization and may revoke it. We will
follow the BBA 824 requirements about the specific information to be
provided with the authorization.
\41\ Attestation is the action taken by an SSA employee of
confirming and annotating on record the proper individual's intent
to sign an SSA form.
\42\ For OASDI disability, we request authorization at the
initial claim, expedited reinstatement (EXR), and work continuing
disability review (CDR) stages. When unsuccessful or if the
individual is not available to provide authorization at the time we
request it, we mail the paper SSA-8240 to the authorizing person,
including a cover letter indicating the individual should complete,
sign, and return the paper SSA-8240 form.
\43\ For SSI, we request authorization at the full and deferred
initial claims, and redetermination stages. We attempt to collect
the authorization verbally and record it in our relevant system of
record. When unsuccessful or if the individual is not available to
provide authorization at the time we request it, we mail the paper
SSA-8240 to the authorizing person, including a cover letter
indicating the individual should complete, sign, and return the
paper SSA-8240 form.
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When we request authorization, we explain the authorization's scope
and duration. With regard to scope, we explain that we will use the
authorization to obtain information from a payroll data provider to
determine initial or ongoing entitlement to disability benefits for
OASDI, as well as eligibility and payment amounts for SSI. We also
explain that we may use the authorization for additional claims
associated with the claim filed, such as an SSI claim by a spouse or
child. In addition, we explain how we may use and disclose records
obtained from payroll data providers consistent with applicable Federal
law and any privacy notices we provide the individual. For example, we
may use the individual's wage and employment information to decide
whether they may be entitled to or eligible for benefits under both the
OASDI disability and SSI programs, even if the individual's
authorization was given for only one of those programs.
With respect to the duration of an authorization, we inform
individuals that the authorization remains in effect until the earliest
of the following occurs:
(a) the individual revokes their authorization in writing;
(b) we terminate all entitlement(s) to benefits or eligibility for
payments, there are no other claims or appeals pending, and all periods
for appealing the determination or decision to terminate entitlement or
eligibility have lapsed; \44\
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\44\ In cases with multiple claims, if one of the claims has an
adverse determination or decision and the appeals period for that
determination or decision has ended or the benefits terminate, we
will no longer use the authorization for that specific claim.
However, we will continue to use the authorization for all other
current claims under the program for which the individual provided
authorization and there is no other reason to end the authorization.
---------------------------------------------------------------------------
(c) there has been an adverse determination or decision under the
OASDI disability or SSI program, and, for that program, the individual
is not otherwise currently entitled to benefits or eligible for
payments, there are no other claims or appeals pending, and the period
for appealing the adverse determination or decision has lapsed; or
(d) for SSI deemors, the deeming relationship ends.\45\
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\45\ Additionally, if a parent or legal guardian gave us the
initial authorization for an individual who is not a legally
incompetent adult, the authorization will terminate when the
individual turns 18 years of age. See, e.g., POMS SI 00515.001.C.
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Individuals may revoke their authorization in writing at any time.
If they revoke their authorization, we will apply the revocation to all
pending or approved claims under the OASDI disability and SSI programs
from the time we process the revocation, including claims involving
deemors. If the authorization is revoked, we will no longer request new
information from payroll data providers for that individual.
3. Reduced Wage Reporting Responsibilities When Individuals Authorize
Us To Access Information Held by Payroll Data Providers Through an
Information Exchange
Currently, if individuals become entitled to OASDI disability or
eligible for SSI, they must report certain wage and employment
information to us. We use this information to make program
determinations. We expect that, once implemented, the information
exchanges will help us reduce the wage reporting obligations of some
individuals. Further explanation follows.
Under section 824 of the BBA and these regulations, when
individuals apply for or become entitled to a benefit based on
disability under OASDI or any type of benefit under SSI and they
authorize us to obtain information from payroll data providers, their
reporting responsibilities may be reduced. The reduced wage reporting
responsibilities depends on whether we receive their wage and
employment information for their employer(s) through a participating
payroll data provider. We will send a notice to individuals whenever
their wage reporting responsibilities change, as discussed in the next
section.
Under our current rules, individuals who are entitled to OASDI
disability must report to us when their condition improves, when they
return to work, when they increase the amount they work, or if their
earnings increase.\46\ There are many ways to do this. As mentioned
above, individuals receiving OASDI disability can report changes in
work activity by phone, fax, mail, in person, or online via their
mySocialSecurity account. Under the proposed rules, we would require
reporting only when their condition improves, they return to work, or
they have a new employer. However, if individuals provide authorization
and we receive their wage and employment information from their
employer(s) through a participating payroll data provider, they would
no longer have to report an increase in the amount of their work or an
increase in their earnings with that employer, because we will obtain
that information directly from the payroll data provider.
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\46\ 20 CFR 404.1588(a). We require reporting an increase in
work or earnings because that may indicate that the beneficiary has
performed substantial gainful activity (see 20 CFR 404.1572 and
404.1574) and will no longer be entitled to an OASDI disability
benefit (20 CFR 404.1520(b)).
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For SSI, wage reporting responsibilities may affect both
eligibility and the payment amount. Individuals must report events that
might change their disability or blindness status, including when their
condition improves, when they return to work, when they increase the
amount of their work, or when their earnings increase.\47\ To determine
SSI eligibility and payment amount, we require individuals to report
various events to us, among them any change in income \48\ and
individuals must report to us as
[[Page 11778]]
soon as a reportable event happens.\49\ As mentioned above, individuals
receiving SSI can report changes in work activity by phone, fax, mail,
in person, online via their mySocialSecurity account, or by using
SSAMWR or SSITWR. However, if individuals provide authorization and we
receive their wage and employment information from their employer(s)
through a participating payroll data provider, they will no longer have
to report an increase in the amount of their work for that employer, an
increase in earnings from that employer, or changes to wages paid in
cash \50\ from that employer, because we will obtain that information
directly from the payroll data provider. All other reporting
obligations apply, as detailed in the chart.
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\47\ See 20 CFR 416.988.
\48\ See 20 CFR 416.708(c).
\49\ See 20 CFR 416.714.
\50\ By ``wages paid in cash'' we are referring to wages paid in
money or its equivalent, as opposed to wages paid ``in kind,'' which
refers to the value of food, clothing, shelter, or other items
provided as wages instead of cash. See 20 CFR 416.1110.
----------------------------------------------------------------------------------------------------------------
Reporting responsibilities under
proposed regulations when we receive
Program Reporting responsibilities under wage and employment information for an
current regulations employer through a payroll data
provider
----------------------------------------------------------------------------------------------------------------
OASDI disability.............. Individuals must report to us when: Individuals must report to us when:
<bullet> their condition improves: <bullet> their condition improves;
<bullet> they return to work; <bullet> they return to work; or
<bullet> they increase the amount <bullet> they have a new employer.
they work; or
<bullet> their earnings increase.
SSI........................... Individuals must report to us any Individuals no longer have to report
change in income as soon as a changes to wages paid in cash.
reportable event happens.
They must also report to us when: They must report to us when:
<bullet> their condition improves; <bullet> their condition improves;
<bullet> they return to work; <bullet> they return to work; or
<bullet> they increase the amount they <bullet> they have a new employer.
work; or
<bullet> their earnings increase.
See Sec. 416.708 for additional See Sec. 416.708 for additional
reporting requirements. reporting requirements.
----------------------------------------------------------------------------------------------------------------
In addition to the reduced wage reporting responsibilities
described above, individuals may not be subject to certain penalties
related to reporting if they authorize us to obtain information from a
payroll data provider. Individuals who authorize us to obtain wage and
employment information from a payroll data provider will not be subject
to penalties under section 1129A of the Act for omissions or errors in
the data we receive from a participating payroll data provider,
excluding situations where there may be fraud or similar fault.\51\
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\51\ 42 U.S.C. 1320a-8a. See 20 CFR 404.459, 416.1340. The
relevant penalty under section 1129A of the Act and 20 CFR 404.459,
416.1340 is the non-payment of OASDI disability benefits and
ineligibility for SSI cash benefits. Other penalties under section
1129A of the Act may apply in situations involving false or
misleading statements, including statements regarding wages and
employment.
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Further, if individuals report changes in income late or not at all
in connection with SSI payments, they may be subject to penalties under
section 1631(e)(2) of the Act, unless they have good cause for the
failure to report timely.\52\ In cases in which an individual has
authorized us to obtain information from a payroll data provider,
however, we will find good cause for a failure of, or delay by, an
individual reporting a change in employer.\53\ In our notice of a
change in reporting responsibilities, we will include any changes in
penalty relief that may apply or when we may make the good cause
finding described above.
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\52\ 42 U.S.C. 1383(e)(2). See 20 CFR 416.722 to 416.732. This
penalty may be assessed for failure or delay in making certain
reports to us.
\53\ This comes directly from the BBA and we expect the intent
was to provide additional relief from reporting obligations for SSI
cases with authorizations. In section 824(c)(2)(B), the BBA added
language to section 1631(e)(2)(B) of the Act clarifying that if
someone authorizes, and there is a failure or delay to report a
change in employer, SSA will find good cause for that failure or
delay if ``the event or change in circumstance is a change in the
individual's employer.'' We would anticipate receiving this
information through the information exchange.
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Penalties that we may impose for failure to report are distinct
from any attempts we may make to recover money that is improperly paid
as a result of an overpayment. While individuals may not be subject to
penalties for omissions or errors that may occur as a result of wage
reporting, if we discover an overpayment, we will still attempt to
recover any improperly paid funds. Although we do not propose it at
this time, we are considering clarifying that for individuals who are
exempt from reporting responsibilities because we get their wage and
income information from a payroll data provider, any overpayments which
result from inaccurate reporting of their income by the payroll data
provider would be treated as an overpayment which they were ``without
fault'' in causing under 20 CFR 404.507 (for OASDI) and 20 CFR 416.552
(for SSI). While we still initially may seek recovery of an overpayment
from an individual who is considered ``without fault'' in causing the
overpayment, these individuals may request a waiver of the overpayment
recovery which we may grant if, among other reasons, we determine that
recovering the overpayment would either be ``against equity and good
conscience'' or ``defeat the purpose'' of the program. Because one
benefit of the payroll exchange is to facilitate the automatic
transmission of wage data without the beneficiary manually reviewing
and reporting this information to us, this alternative would provide an
additional protection for participating beneficiaries against payroll
inaccuracies. As discussed in the Solicitation for Public comment
section below, prior to adopting this alternative policy we seek
comments on if it would lower burdens for our beneficiaries or improve
administrative efficiencies, other improvements we might consider
related to addressing overpayments associated with workers who
participate in the payroll exchange, as well as whether we should
consider any other consequences of this alternative.
[[Page 11779]]
------------------------------------------------------------------------
Penalties under Penalty relief when
Program current law affected providing
by the BBA authorization
------------------------------------------------------------------------
OASDI disability.......... <bullet> Individuals <bullet> Individuals
are subject to are no longer
penalties for subject to penalties
omissions or errors under section 1129A
in wage and for omissions or
employment errors in wage and
information under employment
section 1129A. information that we
receive from a
payroll data
provider through an
information
exchange.
SSI....................... <bullet> Individuals <bullet> Individuals
are subject to are no longer
penalties for subject to penalties
omissions or errors under section 1129A
in wage and for omissions or
employment errors in wage and
information under employment
section 1129A. information that we
<bullet> We may receive from a
impose a penalty payroll data
under section provider through an
1631(e)(2) of the information
Act for a failure or exchange.
delay in reporting <bullet> We will find
certain events or good cause for a
changes in failure of, or delay
circumstances by, an individual
relevant to SSI reporting a change
eligibility or in employer. This
payment amount means the penalty
unless the would not apply.
individual can show
good cause for the
failure or delay.
------------------------------------------------------------------------
4. Procedures for Notifying Individuals in Writing When They Become
Subject to Reduced or Increased Wage Reporting Requirements and When
Penalty Relief Applies
We will notify individuals in writing of changes in their reporting
responsibilities whenever we start or stop receiving their wage and
employment information from a payroll data provider through an
information exchange. We also explain whether they may be subject to
penalties under section 1129A of the Act at the time they provide
authorization.\54\ If they receive SSI, we will also explain when we
will find good cause for a failure or delay in reporting a change in
employer under section 1631(e)(2) of the Act.
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\54\ There are certain instances where an individual may be
subject to penalties even though they have authorized the use of an
information exchange. For example, if an individual authorizes the
use of an information exchange but their employer does not actually
participate in one, they may be subject to penalties for failure to
report their income. As another example, if an individual's employer
participates in the information exchange but the individual fails to
report a separate stream of self-employment income, they may be
subject to penalties for failure to report their income.
---------------------------------------------------------------------------
As discussed above, if individuals authorize us to obtain
information from a payroll data provider, and we receive their wage and
employment information for their employer(s) through a participating
payroll data provider, they will not have to report, for that employer,
changes in earnings for OASDI disability and SSI or wages paid in cash
for SSI. This will continue for as long as we continue to receive this
information through a participating payroll data provider for that
employer, and we will send a notice to the individual informing them of
the change to their reporting responsibilities. We will also send
notices whenever we start and stop receiving information about their
employer and their reporting responsibilities change. All other
reporting requirements will still apply.
If individuals work multiple jobs, they will not have to report an
increase in earnings for OASDI disability and SSI or wages paid in cash
for SSI from any employer(s) whose wage and employment information we
receive from a participating payroll data provider, as long as we
continue to receive this information through a participating payroll
data provider for that employer(s). We will send a notice \55\ to the
individual informing them of any change to their reporting
responsibilities. When an individual gives us authorization to obtain
their wage and employment information from a payroll data provider, we
promptly issue them a receipt that includes the scope and duration of
their authorization and explains their wage reporting responsibilities
related to the information exchange. This receipt explains they are
required to continue to report their wage and employment information to
us until they receive a specific notice telling them that they no
longer must report. The notice will identify the employer(s) for whom
the individual will not need to report wage and employment information
to us. Individuals must still report an increase in earnings for OASDI
disability and SSI and wages paid in cash for SSI from any employer(s)
whose wage and employment information we do not receive through a
participating payroll data provider. They must also tell us if they
have a new employer.
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\55\ Following publication of this proposed rule, we will submit
to OMB a request for a revision to an existing information
collection under the Paperwork Reduction Act (5 CFR 1320.11).
---------------------------------------------------------------------------
If individuals revoke their authorization, we will notify them in
writing to explain that all reporting responsibilities apply and that
penalties relating to reporting may apply.
When Individuals Disagree With Wage and Employment Information Obtained
From a Payroll Data Provider
As noted above, wage and employment information may affect OASDI
disability entitlement, SSI eligibility, and SSI payment amounts
because we use that information to determine or decide who can receive
benefits and the amount of the SSI payments for eligible individuals.
If we implement the information exchange, we would obtain the payroll
data from the previous month on or around the 7th day of the current
month. For example, on November 7, 2023, we would receive the wage and
employment information for October 2023. If our use of wage and
employment information from a payroll data provider affects
entitlement, eligibility, or payment amounts, all of our usual
procedures apply.\56\ By receiving this information early in a month
for SSI cases, we should have enough time to calculate the correct
payment, send an advance notice or Notice of Planned Action (NOPA) when
an adverse action applies, and adjust benefits accurately for the
following month (December 2023 in this example).\57\
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\56\ As described in this and subsequent paragraphs, we will
provide adequate notice to beneficiaries before adversely adjusting
their benefits. However, we do not undertake any specialized review
of payroll data to identify potential aberrations or other
indicators that a reported income may be particularly unlikely to be
accurate.
\57\ We note that the monthly information exchange only provides
us data for the previous month but does not provide any updates to
revisions made for earlier months. For example, if during the May
7th, 2024 information exchange we received information that a
beneficiary earned $500 in April, but during the month of May the
employer corrected that amount in their own payroll system to $800,
the June 7th, 2024 information exchange would not alert us to the
change in reported income for April.
---------------------------------------------------------------------------
For OASDI disability, we send a notice to the beneficiary before
taking an adverse action (e.g., reduction, suspension, or termination
of benefits) if we learned of the reason for the action from a source
other than a first party report. We call this an advance notice. Once
we issue the advance notice, the beneficiary has 15 days or 35 days to
rebut the information in the advance notice before the adverse action
will
[[Page 11780]]
occur.\58\ If we do not hear from the beneficiary within the timeframe,
we assume the information in the advance notice is correct and we will
take the adverse action. When we take the adverse action, the
beneficiary will receive a final (initial determination) notice,\59\
which provides the beneficiary with the right to appeal the action
taken.
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\58\ The time frame for rebuttal is 15 days for cases that
involve adverse actions or adjustments that do not involve an
automated computer or non-automated data match and 35 days for cases
that involve automated computer or non-automated data match. See
POMS GN 03001.015. Individuals whose wage and employment information
is received through an information exchange will have 35 days to
rebut the information.
\59\ Initial determinations are the determinations we make that
are subject to administrative and judicial review. We base our
initial determination on the preponderance of the evidence. We state
the important facts and give the reasons for our conclusions in the
initial determination. See 20 CFR 404.902, 20 CFR 404.900, 20 CFR
416.1402, and 20 CFR 416.1400. We mail a written notice of our
initial determination to them at their last known address. The
written notice will explain in simple and clear language what we
have determined and the reasons for and the effect of our
determination. If our determination involves a determination of
disability that is in whole or in part unfavorable to them, our
written notice also will contain in understandable language a
statement of the case setting forth the evidence on which our
determination is based. The notice also will inform them of their
right to reconsideration. We will not mail a notice if the
beneficiary's entitlement to benefits has ended because of their
death. See 20 CFR 404.904 and 20 CFR 416.1404. Initial
determinations may be appealed within 60 days (or longer with good
cause). See 20 CFR 404.909, 20 CFR 404.901, 20 CFR 416.1409, and 20
CFR 416.1401. To appeal an initial determination, an individual may
file an SSA-561-U2 Reconsideration Request available at: <a href="https://www.ssa.gov/forms/ssa-561-u2.pdf">https://www.ssa.gov/forms/ssa-561-u2.pdf</a>. To appeal a Reconsideration
Determination, an individual can file an HA-501-U5 Request for
Hearing by Administrative Law Judge available at <a href="https://www.ssa.gov/forms/ha-501.pdf">https://www.ssa.gov/forms/ha-501.pdf</a>. To appeal a hearing decision, an
individual can file an HA-520 Request for Review of Hearing
Decision/Order available at <a href="https://www.ssa.gov/forms/ha-520.html">https://www.ssa.gov/forms/ha-520.html</a>.
To appeal an Appeals Council Decision or if the Appeals Council
denies review of the hearing decision, an individual can file an
action in Federal District Court. The SSA-561-U2, HA-501-U5, and HA-
520 can be completed and submitted online via the Non-Medical Appeal
Page available at <a href="https://secure.ssa.gov/iApplNMD/start">https://secure.ssa.gov/iApplNMD/start</a>.
OASDI Disability
------------------------------------------------------------------------
------------------------------------------------------------------------
Estimated Date by Which Information For adverse actions that do not
Must Be Received for an Adverse Action. involve an automated computer
or non-automated data match:
At least 15 days in advance.
For adverse actions that
involve an automated computer
or non-automated data match:
At least 35 days in advance.
Note: Individuals whose wage
and employment information is
received through an
information exchange will have
35 days to rebut the
information.
------------------------------------------------------------------------
For SSI, we send a NOPA to the beneficiary before taking an adverse
action (e.g., reduction, suspension, or termination of benefits). This
NOPA, also referred to as a Goldberg Kelly (GK) notice, is a written
notice of proposed adverse action. The notice includes the basis for
the adverse action and an explanation of appeal rights. It allows a
recipient the necessary time to appeal the planned action and continue
to receive unreduced benefits pending a determination on the appeal.
After receiving the NOPA, the individual has 60 days to file an appeal.
If an appeal is filed within 60 days, the recipient will receive,
unless waived, continued, or reinstated SSI payments until we make a
determination at the reconsideration level.\60\
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\60\ 20 CFR 416.1336(b) and EM 21064REV.
---------------------------------------------------------------------------
Because we must provide a NOPA before reducing or terminating
benefits, we will only take an adverse action if we receive information
leading to that action at least 15 days before the first day of the
adverse action month. This allows time for mailing and for the
individual to respond. If there is insufficient time remaining in the
month to accommodate the NOPA procedures, we will not take the adverse
action until the following month. For example, if we received
information adversely affecting ongoing benefits on March 26, 2024, we
would send a NOPA that notifies the recipient of the adverse action
that will occur in May 2024. The first month we could reduce or
terminate benefits would be May 2024.\61\ Because the wage and
employment information from the information exchange is always
requested for the prior month, the pay period cycle (i.e., the date the
individual receives payment) has a minimal effect on the information
exchange.
---------------------------------------------------------------------------
\61\ POMS SI 02301.301.
SSI
------------------------------------------------------------------------
------------------------------------------------------------------------
Estimated Date by Which Earnings Must For adverse actions: At least
Be Received for an Adverse Action. 15 days before the first day
of the adverse action month.
------------------------------------------------------------------------
As noted above, our usual procedures apply. This includes our
procedures for seeking review of an initial determination and any
related procedures. Our administrative review process is described in
existing regulations Sec. 404.900 for OASDI disability and Sec.
416.1400 for SSI. As in any other case, the process consists of several
administrative review steps which generally must be completed within
certain time periods, and in the following order: (1) initial
determination, (2) reconsideration, (3) hearing held by an
administrative law judge, and (4) Appeals Council review.\62\ An
individual who is dissatisfied with our final decision may seek
judicial review.\63\
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\62\ See subpart J of 20 CFR 404 and subpart N of 20 CFR 416.
\63\ See section 205(g) of the Act, 42 U.S.C. 405(g).
---------------------------------------------------------------------------
A claimant, recipient, beneficiary, or deemor may present us with
evidence such as pay stubs or we may send requests to their employers
for this information, if the individual believes our information is not
correct.\64\ We will consider all evidence submitted and use it to
determine the appropriate action for the individual's record. We will
prioritize pay stubs over payroll data provider information in
situations in which the individual questions the wage and employment
information we receive from payroll data providers through an
information exchange. We have longstanding policies for resolving
discrepancies in wage evidence, which we would leverage. Individuals
are
[[Page 11781]]
generally responsible for providing evidence to us, but if a situation
arises in which it is difficult for them to obtain evidence, we may
assist them. Our policies direct technicians to use other acceptable
evidence of wages when discrepancies are present, and to document the
discrepancy, resolution, and associated evidence. If a technician
determines based on acceptable evidence that the earnings do not belong
to the individual, those earnings will be removed and will not affect
SSI eligibility or payment determinations.
---------------------------------------------------------------------------
\64\ Section 824 of the BBA allows us to treat the wage and
employment information we receive from the from a payroll data
provider through the information exchange as verified and does not
require additional verification.
---------------------------------------------------------------------------
In addition, if an individual is not satisfied with the wage and
employment information we are receiving from payroll data providers
through an information exchange, they have the option to revoke
authorization at any time.
Finally, we are requesting public input on expanding the methods
which are available under our regulations to initiate a reconsideration
(which is the first step of appealing an adverse decision). We do not
intend to make any changes to the appeals filing process at this time,
but we will consider public input for future rulemaking. One such
option would be removing the requirement that reconsideration requests
must be ``written.'' Under our current regulations, a request for
reconsideration can only be made as a ``written request'' (see 20 CFR
404.909(a) and 20 CFR 416.1409(a)). As a result, if an individual
participating in the payroll exchange receives an advanced notice or
NOPA indicating that their benefits may be reduced, they do not have
the option of calling our 800 number or a field office to initiate the
process of requesting a reconsideration (currently, available options
for initiating a reconsideration request including completing and
mailing paper form SSA-561, visiting a field office and completing an
SSA-561 in-person, or completing the i561 through <a href="http://www.ssa.gov">www.ssa.gov</a>). This
alternative would allow individuals, if they desired, to submit a
request by calling us (which may be the preferred option for many of
our beneficiaries). As discussed in the Solicitation for Public comment
section below, we seek comments on if this would lower burdens for our
beneficiaries as well as whether we should consider any other
consequences of this alternative.
Summary of Changes
In Sec. 404.702 and Sec. 416.702, we propose to add definitions
for ``Participating payroll data provider'' and ``Payroll data
provider.''
In Sec. 404.703, we propose to designate the existing text as
paragraph (a) and add paragraph (b) to explain that we will ask
individuals for written authorization so that we can obtain their wage
and employment information from a payroll data provider when they apply
for or become entitled to monthly insurance benefits. We will also
explain the scope and duration of the authorization and how we will use
it.
In Sec. 404.1588, we propose to clarify in paragraph (a) that an
individual must report if they have a new employer. This clarification
will more effectively cover the situation where an individual starts a
new job, rather than requiring individuals to report all increased work
when reduced reporting applies. We also propose to add a new paragraph
(b) to explain OASDI disability reporting obligations when individuals
authorize us to obtain their wage and employment information from
payroll data providers. Proposed Sec. 404.1588(b) explains that if we
have the authorization described in Sec. 404.703, we will reduce
reporting responsibilities if we receive the individuals' wage and
employment information from their employer(s) through a participating
payroll data provider, but only for that employer(s). We will notify
individuals in writing whenever there is a change in their reporting
responsibilities related to the authorization, or when they may be
subject to certain penalties. However, the OASDI disability beneficiary
will always have to report when their condition improves, when they
return to work, and when they have a new employer.
We also explain that individuals may revoke their authorization in
writing at any time and that if they do, we will apply the revocation
to all pending or approved disability claims under OASDI and all
pending or approved claims under SSI from the time we process the
revocation. If they revoke their authorizations, they will be subject
to all reporting responsibilities and possible penalties. Also, we
removed references to the centralized computer file from redesignated
paragraph (c) because these references were outdated.\65\
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\65\ We are proposing to remove outdated language in this
section and in Sec. 416.709 (discussed below) explaining that the
establishment of a centralized computer file may cause us to stop
issuing receipts under certain circumstances. Because we do not use
the centralized computer file described in the regulations, we are
removing references to it. We will continue to issue receipts
whenever we get information about the changes described in this
section or in earned income described in Sec. 416.709.
---------------------------------------------------------------------------
We propose to revise Sec. 416.701 to explain that subpart G
discusses what events individuals must report to us. We inform
individuals what their reports must include, when reports are due, and
when certain reporting requirements and penalties relating to reporting
requirements do not apply.
We propose to revise Sec. 416.708 to explain that individuals must
report any increase or decrease in their income and any increase or
decrease in the income of certain other individuals, unless the
circumstances in Sec. 416.709(a) and (c) apply. Those circumstances
are:
<bullet> they authorize us to obtain information from a payroll
data provider; and
<bullet> we receive their wage and employment information from
their employer(s) through a participating payroll data provider.
Also, we removed references to the centralized computer file from
paragraph (c) because these references were outdated.\66\
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\66\ Id.
---------------------------------------------------------------------------
We propose to add a new section, Sec. 416.709, to explain the
potential for reduced reporting responsibilities for SSI when an
individual authorizes us to obtain wage and employment information from
payroll data providers through an information exchange. As proposed,
Sec. 416.709(a) explains that we will ask individuals for written
authorization to obtain wage and employment information about them from
a payroll data provider whenever we determine the information is needed
in connection with a determination of initial or ongoing eligibility
for SSI benefits. We further explain the scope and duration of the
authorization, and when reporting requirements change in proposed
paragraphs (b) and (c) of Sec. 416.709. Reporting responsibilities
will change based on whether we receive an individual's wage and
employment information from their employer(s) through a participating
payroll data provider. If we receive wage and employment information
from an individual's employer(s) through a participating payroll data
provider, they will not have to report changes in their wages paid in
cash from that employer(s) only. However, the individual will have to
comply with all other reporting requirements.
In proposed paragraph (c) in Sec. 416.709, we also explain that
when we inform individuals about changes in their reporting
responsibilities, we will also inform them whether they may be subject
to certain penalties, and when and how they may revoke their
authorization.
We propose to revise Sec. 416.988 to explain that, if we receive
wage and employment information from an individual's employer(s)
through a participating payroll data provider, they
[[Page 11782]]
will not have to report an increase in the amount of work or an
earnings increase from that employer(s) only. As with Sec. 404.1588,
we have clarified that an individual must report a new employer. This
clarification will more effectively cover the situation where an
individual starts a new job, rather than requiring individuals to
report all increased work when reduced reporting applies.
We also propose to add a new section, Sec. 422.150, to explain our
guidelines for establishing and maintaining an information exchange
with payroll data providers. We will identify and review payroll data
providers to determine their ability to engage in an information
exchange with us. We also explain that consistent with applicable law
and regulations, we will establish an information exchange with the
selected payroll data provider. Proposed Sec. 422.150(a) also explains
the requirements for an information exchange, and that we will publish
a notice in the Federal Register describing the information exchange
and other factors before we receive and use information from a payroll
data provider. Finally, proposed Sec. 422.150(b) explains that we will
periodically assess whether the data we receive under an information
exchange continues to be accurate, complete, and up-to-date, and
monitor compliance with the requirements of the information exchange.
Solicitation for Public Comment
As discussed elsewhere in this NPRM, we are seeking public comment.
Questions that interested parties may wish to consider when evaluating
this proposed rule:
1. If we receive someone's wage and employment information through
the payroll exchange, should we treat any overpayments which result
from inaccurate reporting of their wage and employment information by
their employer or the payroll data provider as an overpayment which the
individual was ``without fault'' in causing? Would this lower burdens
for our beneficiaries or improve administrative efficiencies, are there
other improvements we might consider related to addressing overpayments
associated with workers who participate in the payroll exchange, or are
there any other consequences that we should consider?
2. Should we revise our regulations to remove the requirement that
reconsideration be received only via ``written request'' to accommodate
the ability to receive reconsideration requests via the phone? Would
this lower burden for beneficiaries and are there any other
consequences that we should consider?
Rulemaking Analyses and Notices
Clarity of These Rules
Executive Order (E.O.) 12866 as supplemented by E.O. 13563 and
amended by E.O. 14094 require each agency to write all rules in plain
language. In addition to your substantive comments on this NPRM, we
invite your comments on how to make rules easier to understand.
For example:
<bullet> Would more, but shorter, sections be better?
<bullet> Are the requirements in the rule clearly stated?
<bullet> Have we organized the material to suit your needs?
<bullet> Could we improve clarity by adding tables, lists, or
diagrams?
<bullet> What else could we do to make the rule easier to
understand?
<bullet> Does the rule contain technical language or jargon that is
not clear?
<bullet> Would a different format make the rule easier to
understand, e.g., grouping and order of sections, use of headings,
paragraphing?
Regulatory Procedures
E.O. 12866 as Supplemented by E.O. 13563 and Amended by E.O. 14094
We consulted with the Office of Management and Budget (OMB) and OMB
has determined that this proposed rule meets the criteria for a Section
3(f)(1) significant regulatory action under E.O. 12866, as supplemented
by E.O. 13563 and amended by E.O. 14094 and is subject to OMB review.
Assumptions
We estimate that, by 2033, 96% of SSI recipients will have
authorized us to obtain this information from payroll data providers
through information exchanges, and about 60% of disabled OASDI
beneficiaries will have also provided this authorization. We base this
estimate on current rates of adoption as we have sought authorization
from beneficiaries during both new enrollment and disability review
processes since late 2017. Since 2017, 98% of OASDI disability
beneficiaries and SSI recipients who have been asked have provided
authorization--this corresponds to about 25% of all current OASDI
disability beneficiaries as of May 2023. As of July 2022, 56% of all
current SSI recipients and 67% of SSI deemors have provided
authorization.\67\
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\67\ We do not know why SSI deemors have provided authorization
at a higher rate than beneficiaries.
---------------------------------------------------------------------------
We estimate that there are about 1,100,000 OASDI disability
beneficiaries, between 200,000 and 300,000 SSI recipients, and another
500,000 to 600,000 deemors of SSI recipients who work in a given year.
Because employers representing approximately two-thirds of the non-farm
payroll of employees will automatically provide payroll data to us, we
expect individuals will submit fewer wage reports.\68\
---------------------------------------------------------------------------
\68\ As stated in the preamble, neither SSA nor Equifax has
analyzed whether working disability benefit recipients are
represented in a similar proportion in the database, but we assume
it for the purposes of this analysis.
---------------------------------------------------------------------------
Additionally, we estimate that there are 100,000 OASDI disability
beneficiaries who are overpaid due to working at or above the SGA
level. Over FYs 2018 through 2022, these individuals were overpaid an
annual average of $1,163 million. We estimate that, through the
information exchange, we will be able to identify both wages we
otherwise would not have known about, as well as wages that will be
identified timelier than under current processes. Additionally, we
estimate that we will identify and assess approximately an additional
10% of overpayments due to working at or above SGA (OASDI) or having
wages from employment (SSI) which we never would have identified
through our current processes.\69\
---------------------------------------------------------------------------
\69\ We do not have data to specifically support the assumption
that we will identify 10% more overpayments. However, we do know
certain small overpayments may be currently overlooked through our
current systems. Through review processes such as the Master
Earnings File, SSA is generally able to identify overpayments from
unreported wage changes at least on an annual basis. In certain
circumstances, however, annual earnings as identified on the Master
Earnings File or on a quarterly match may be below the threshold for
identifying an overpayment even though the beneficiary's monthly
earnings in certain months would have resulted in changes to the
amount they were owed. For example, if an OASDI disability
beneficiary worked at $50 above SGA for 11 months of the year, and
worked $0 in the 12th month, they would generally be passed over in
the annual match because their total annual wages would be below 12
times SGA. Having the monthly data would give SSA more exact
information and the agency would be able to compare on a monthly
basis whether earnings exceeds SGA. As another example, certain de
minimis changes in benefit payment rates due to changes in income
may not be assessed under current policy because of required efforts
under current processes; because these processes will be automated
through PIE, these changes will be made in a timely manner.
---------------------------------------------------------------------------
Anticipated Costs to the Public
There are minor costs to the public associated with this
rulemaking. Individuals who apply for or are receiving OASDI
disability, individuals who apply for or are receiving SSI, and SSI
deemors, will need to spend a
[[Page 11783]]
minimal amount of time to complete the authorization to allow us to
obtain wage and employment information from payroll data providers
through an information exchange. Similarly, individuals who want to
revoke their authorizations would need to spend a minimal amount of
time to do so. We anticipate this time would be more than offset by the
time saved by individuals who would no longer need to spend time
reporting certain wage and employment information and work activity.
There is a potential for lost benefits to the beneficiary or
recipient in instances where we make an unfavorable or partially
favorable determination or decision based on potentially inaccurate
information obtained from payroll data providers through an information
exchange. We have not estimated at this time the number of additional
NOPAs which might be due to inaccurate payroll information.
There is a potential burden on the public to correct any inaccurate
data reported to us from a payroll data provider if an individual
identifies an error in the information we receive through an
information exchange. However, the primary burden related to these
rules is the time it would take for the individual to correct
information with us. Additionally, although individuals can give us
information that we may use to correct our records, they may also have
to work with the payroll data provider directly to correct any
inaccurate data in its records, because we can only update our
records.\70\
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\70\ When an individual believes the information we are
receiving from a payroll data provider is incorrect, they can
correct the information with us. A beneficiary may also wish to
contact the payroll data provider to resolve a recurring issue or
if, for example, they believe the error may be due to potential
fraud. We will provide information in the advance notice (for OASDI
disability) or NOPA (for SSI) for how to contact the payroll data
provider directly.
---------------------------------------------------------------------------
We anticipate minimal costs to the public associated with reporting
inaccurate data based on the accuracy rate recorded in the accuracy
analysis study previously discussed and included in the rulemaking
record.
Anticipated Benefit to the Public
An information exchange has many benefits. Individuals will have
reduced wage reporting responsibilities if they provide us with
authorization to obtain their wage and employment information from a
payroll data provider and we obtain that information from a
participating payroll data provider through an information exchange.
Reducing reporting responsibilities relieves the burden placed on
individuals to report certain wage and employment information to us if
we are already receiving it from a payroll data provider through an
information exchange. This reduced reporting responsibility should make
it easier for individuals to comply with our wage reporting rules. It
reduces the individual's need to report certain wage and employment
information to us which includes the burden of the time it takes the
individual to report this information and the burden of remembering to
report it to us within a certain timeframe.
The timely receipt of wage and employment information from a
payroll data provider through an information exchange would also help
us reduce improper payments, which may be a source of confusion for the
public and may cause individuals to spend time addressing errors
associated with improper payments or filing appeals or waiver requests.
Lastly, authorizing us to obtain records from a payroll data provider
through an information exchange may relieve individuals from certain
penalties under section 1129A of the Act for any omission or error with
respect to wages reported to us by a participating payroll data
provider. And for SSI, we will find good cause for a failure or delay
in reporting a change in employer, which can avoid certain additional
penalties.
Anticipated Transfers to Our Program
Our Office of the Chief Actuary estimates that implementation of
this proposed rule would result in a total net reduction in OASDI
benefit payments of $1.8 billion and a total net reduction in Federal
SSI payments of $1.9 billion over fiscal years 2024 through 2033. The
estimates assume implementation of this rule on October 1, 2023, and
that SSA will not, during the estimate period, contract with any other
payroll data provider beyond Equifax. We note that the increase in the
amount of overpayments identified or prevented in this period would be
larger than the reduction in actual benefits paid in this period.
First, regarding overpayments newly identified, as discussed in our
Assumptions section, these estimates assume that 50 percent of work-
related overpayments identified for OASDI beneficiaries and 80 percent
of earned-income related overpayments for SSI recipients will be
recovered within 10 years after they are identified. Thus, much of the
overpayments newly identified, especially those identified late in this
10-year period, will be only partially recovered with subsequent
reductions in payments through fiscal year 2033. Second, while
potential overpayments that would be prevented due to implementation of
this rule will immediately reduce benefit payments, such early
identification of earnings will also avoid subsequent potential
overpayments through fiscal year 2033 and beyond.
Anticipated Administrative Costs to the Social Security Administration
The Office of Budget, Finance, and Management estimates that this
proposal will result in a net administrative cost of $419 million for
the 10-year period from FY 2024 to FY 2033. The net administrative cost
is mainly a result of the contract and IT costs to administer the
information exchange. The total costs are offset by some administrative
savings from a shorter wage development process in affected cases
during title XVI (SSI) pre-effectuation reviews, redeterminations,
post-eligibility actions, and overpayments, as well as during title II
(OASDI) work continuing disability reviews. However, we do not attempt
to estimate these time savings. As explained above, under our current
process, we sometimes conduct a manual query to request records from
payroll data providers or employers. We estimate we would save
approximately 20 minutes of our staff's time each time we no longer
need to complete this query.\71\
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\71\ We note these savings are for our staff. They do not
represent public reporting burden savings.
---------------------------------------------------------------------------
Executive Order 13132 (Federalism)
We analyzed this proposed rule in accordance with the principles
and criteria established by Executive Order 13132 and determined that
the proposed rule will not have sufficient Federalism implications to
warrant the preparation of a Federalism assessment. We also determined
that this proposed rule will not preempt any State law or State
regulation or affect the States' abilities to discharge traditional
State governmental functions.
Regulatory Flexibility Act
We certify that these proposed rules will not have a significant
economic impact on a substantial number of small entities because it
primarily affects individuals. In some instances, this proposed change
may reduce the burden on employers because we may need to contact
employers for information less frequently when we receive wage and
employment information from payroll data providers through an
information exchange. Because our contact with employers for this
reason is limited now, we do not expect a significant
[[Page 11784]]
difference. Therefore, a regulatory flexibility analysis is not
required under the Regulatory Flexibility Act, as amended. We discuss
the time burden savings for employers stemming from this proposed rule
in the Paperwork Reduction Act section of the preamble.
Paperwork Reduction Act Statement
SSA already has existing OMB-approved information collection tools
relating to this proposed rule: the Letter to Employer Requesting
Information About Wages Earned by Beneficiary (SSA-L725, OMB Control
No. 0960-0034); Letter to Employer Requesting Wage Information (SSA-
L4201, OMB Control No. 0960-0138); Monthly SSI Wage Reporting (SSA's
Mobile Wage Reporting, Telephone Wage Reporting, and Internet myWage
Report application, OMB Control No. 0960-0715); the Authorization for
the Social Security Administration to Obtain Wage and Employment
Information from Payroll Data Providers (Form SSA-8240, OMB Control No.
0960-0807); and the Notice to Electronic Information Exchange Partners
to Provide Contractor List (SSA-731, OMB Control No. 0960-0820). While
we previously obtained OMB approval for the new form (under OMB Control
No. 0960-0807) to collect the authorization for the wage and employment
information from payroll data providers, SSA has not utilized this
information through an automated information exchange, because those
exchanges have not yet gone live. The proposed rule provides additional
information on OASDI and SSI reduced reporting requirements, as well as
the effects of beneficiaries, recipients, and deemors authorizing us to
obtain records from payroll data providers. In addition, the proposed
rule describes the establishment of the requirements to enter into an
information exchange with payroll data providers. SSA established the
information collection for the Authorization for the Social Security
Administration to Obtain Wage and Employment Information from Payroll
Data Providers (0960-0807) prior to the creation of this new rule. We
will include the appropriate CFR citations under that OMB approved
information collection upon publication of the final rule. In addition,
we will obtain OMB approval for revisions to the collection instruments
as needed simultaneously with the publication of the final rule.
Finally, the implementation of this proposed rule would decrease the
time burden for the public, as it would remove the need for individuals
or employers to submit wages to SSA when we receive them from payroll
data providers through an information exchange instead. While we
acknowledge that there is a burden on the public for 20 CFR
422.150(a)(3), we did not include it in the chart below because fewer
than 10 providers submit this information to SSA. The following chart
shows the anticipated burden reduction due to the other regulatory
requirements from this proposed rule:
--------------------------------------------------------------------------------------------------------------------------------------------------------
Anticipated Anticipated Anticipated
Current Current new number new burden estimated Estimated
Number of Frequency average estimated of per response total burden burden
OMB #; form #; CFR citations respondents of response burden per total respondents under under savings
response burden under regulation regulation (hours)
(minutes) (hours) regulation (minutes) (hours)
--------------------------------------------------------------------------------------------------------------------------------------------------------
0960-0034--SSA-L725........................ 170,000 1 40 113,333 170,000 40 113,333 * 0
0960-0138--SSA-L4201....................... 133,000 1 30 66,500 133,000 30 66,500 * 0
0960-0715--Mobile Wage reporting, 88,382 12 6 106,058 36,237 6 43,484 62,574
404.703(a), 416.708(c), 416.709 (new).....
0960-0715--Telephone Wage reporting, 16,341 12 5 16,341 6,700 5 6,700 9,641
404.703(a), 416.708(c), 416.709 (new).....
0960-0715--myWage Report, 404.703(a), 3,557 12 7 4,980 1,458 7 2,041 ** 2,939
416.708(c), 416.709 (new).................
0960-0807--SSA-8240, 404.703(b), 150,000 1 8 20,000 150,000 8 20,000 * 0
404.1588(a), 404.1588(b)(3)(iii),
404.1588(b)(4), 416.988(a)................
0960-0807--MCS/SSI Claim System, 697,580 1 3 34,879 697,580 3 34,879 * 0
404.703(b), 404.1588(a),
404.1588(b)(3)(iii), 404.1588(b)(4),
416.988(a)................................
0960-0807--Internet, 404.703(b), 147,820 1 3 7,391 147,820 3 7,391 * 0
404.1588(a), 404.1588(b)(3)(iii),
404.1588(b)(4), 416.988(a)................
------------------------------------------------------------------------------------------------------------
Totals................................. 1,406,680 ........... ........... 369,482 1,342,795 ............ 294,328 75,154
--------------------------------------------------------------------------------------------------------------------------------------------------------
* These proposed rules will not significantly affect the burden for this information collection; therefore, we do not anticipate any burden reduction
for this information collection due to the implementation of this rule.
** SSA is providing this figure as a current best estimate for burden reduction under these proposed rules. We will not have accurate data until we
implement the rule.
The following chart shows the reduction in theoretical cost burdens
associated with the proposed rule:
--------------------------------------------------------------------------------------------------------------------------------------------------------
Average
Estimated Anticipated Average combined wait Anticipated
Anticipated burden per estimated theoretical time in field annual
OMB #; form #; CFR citations new number of response from total burden hourly cost office and/or opportunity
respondents chart above under amount teleservice cost (dollars)
(minutes) regulation (dollars) * centers ***
(hours) (minutes) **
--------------------------------------------------------------------------------------------------------------------------------------------------------
0960-0034--SSA-L725..................................... 170,000 40 113,333 * $25.14 0 *** $2,849,192
0960-0138--SSA-L4201.................................... 133,000 30 66,500 * 25.14 0 *** 1,671,810
0960-0715--Mobile Wage reporting, 404.703(a), 36,237 6 43,484 * 21.29 0 *** 925,774
416.708(c), 416.709 (new)..............................
[[Page 11785]]
0960-0715--Telephone Wage reporting, 404.703(a), 6,700 5 6,700 * 21.29 0 *** 142,643
416.708(c), 416.709 (new)..............................
0960-0715--myWage Report, 404.703(a), 416.708(c), 1,458 7 2,041 * 21.29 0 *** 43,453
416.709 (new)..........................................
0960-0807--SSA-8240, 404.703(b), 404.1588(a), 150,000 8 20,000 * 21.29 ** 24 *** 1,703,200
404.1588(b)(3)(iii), 404.1588(b)(4), 416.988(a)........
0960-0807--MCS/SSI Claim System, 404.703(b), 697,580 3 34,879 * 21.29 ** 21 *** 5,940,591
404.1588(a), 404.1588(b)(3)(iii), 404.1588(b)(4),
416.988(a).............................................
0960-0807--Internet, 404.703(b), 404.1588(a), 147,820 3 7,391 * 21.29 ** 21 *** 1,258,835
404.1588(b)(3)(iii), 404.1588(b)(4), 416.988(a)........
-----------------------------------------------------------------------------------------------
Totals.............................................. 1,342,795 .............. 294,328 .............. .............. *** 14,535,498
--------------------------------------------------------------------------------------------------------------------------------------------------------
* We based this figure on the average Payroll and Timekeeping Clerks hourly salary, as reported by the Bureau of Labor Statistics data (<a href="https://www.bls.gov/oes/current/oes433051.htm">https://www.bls.gov/oes/current/oes433051.htm</a>); as well as the averaging of SSDI payments based on SSA's current FY 2023 data (<a href="https://www.ssa.gov/legislation/2023factsheet.pdf">https://www.ssa.gov/legislation/2023factsheet.pdf</a>) and the average U.S. citizen's hourly salary, as reported by Bureau of Labor Statistics data (<a href="https://www.bls.gov/oes/current/oes_nat.htm">https://www.bls.gov/oes/current/oes_nat.htm</a>).
** We based this figure on the average FY 2023 wait times for field offices and hearings office, as well as by averaging both the average FY 2023 wait
times for field offices and teleservice centers, based on SSA's current management information data.
*** This figure does not represent actual costs that SSA is imposing on recipients of Social Security payments to complete this application; rather,
these are theoretical opportunity costs for the additional time respondents will spend to complete the application. There is no actual charge to
respondents to complete the application.
SSA submitted a single new Information Collection Request which
encompasses revisions to information collections currently under OMB
Numbers 0960-0034, 0960-0138, 0960-0715, 0960-0807) to OMB for the
approval of the changes due to the proposed rule. After approval at the
final rule stage, we will adjust the figures associated with the
current OMB numbers for these forms to reflect the new burden. We are
soliciting comments on the burden estimate; the need for the
information; its practical utility; ways to enhance its quality,
utility, and clarity; and ways to minimize the burden on respondents,
including the use of automated techniques or other forms of information
technology. In addition, we are specifically seeking comment on whether
you have any questions or suggestions for edits to the forms referenced
above in the context of this proposed regulatory change. If you would
like to submit comments, please send them to the following locations:
Office of Management and Budget, Attn: Desk Officer for SSA, Fax
Number: 202-395-6974
Social Security Administration, OLCA, Attn: Reports Clearance Director,
Mail Stop 3253 Altmeyer, 6401 Security Blvd., Baltimore, MD 21235, Fax:
410-966-2830, Email address: <a href="/cdn-cgi/l/email-protection#92ddc0bcc0f7e2fde0e6e1bcd1fef7f3e0f3fcf1f7d2e1e1f3bcf5fde4"><span class="__cf_email__" data-cfemail="a3ecf18df1c6d3ccd1d7d08de0cfc6c2d1c2cdc0c6e3d0d0c28dc4ccd5">[email protected]</span></a>
You can submit comments until April 15, 2024, which is 60 days
after the publication of this notice. To receive a copy of the OMB
clearance package, contact the SSA Reports Clearance Officer using any
of the above contact methods. We prefer to receive comments by email or
fax.
(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)
List of Subjects
20 CFR Part 404
Administrative practice and procedure; Blind; Disability benefits;
Old-Age, Survivors, and Disability Insurance; Reporting and
recordkeeping requirements; Social Security.
20 CFR Part 416
Administrative practice and procedure; Aged, Blind, Disability
benefits, Public Assistance programs; Reporting and recordkeeping
requirements; Supplemental Security Income (SSI).
20 CFR Part 422
Administrative practice and procedure; Organization and functions
(Government agencies); Operational effectiveness; Social Security.
The Commissioner of Social Security, Martin O'Malley, having
reviewed and approved this document, is delegating the authority to
electronically sign this document to Faye I. Lipsky, who is the primary
Federal Register Liaison for SSA, for purposes of publication in the
Federal Register.
Faye I. Lipsky,
Federal Register Liaison, Office of Legislation and Congressional
Affairs, Social Security Administration.
For the reasons set out in the preamble, we propose to amend 20 CFR
chapter III parts 404, 416, and 422 as set forth below:
PART 404--FEDERAL OLD-AGE, SURVIVORS AND DISABILITY INSURANCE
Subpart H--Evidence
0
1. The authority citation for subpart H of part 404 is revised to read
as follows:
Authority: 42 U.S.C. 405(a), 902(a)(5), and 1320e-3.
0
2. Amend Sec. 404.702 by adding, in alphabetical order, the
definitions of ``Participating payroll data provider'' and ``Payroll
data provider'' to read as follows:
Sec. 404.702 Definitions.
* * * * *
Participating payroll data provider means a payroll data provider
that has established an information exchange with us to provide wage
and employment information.
Payroll data provider means payroll providers, wage verification
companies, and other commercial or non-commercial entities that collect
and maintain information regarding employment and wages.
* * * * *
0
3. Revise Sec. 404.703 to read as follows:
Sec. 404.703 When evidence is needed.
(a) Evidence. When you apply for benefits, we will ask for evidence
that you are eligible for them. After you become entitled to benefits,
we may ask for evidence showing whether you continue to be entitled to
benefits; or evidence showing whether your benefit payments should be
reduced or stopped. See Sec. 404.401 for a list showing when benefit
payments must be reduced or stopped.
[[Page 11786]]
(b) Authorization to obtain data from a payroll data provider.
(1) We will ask you for a written authorization to obtain
information about you from a payroll data provider whenever we
determine the information is needed in connection with a determination
of initial or ongoing entitlement to benefits.
(2) When we ask for your authorization, we will explain the
authorization's scope and duration.
(i) We will explain to you that we will use the information
obtained from a payroll data provider when it is needed in connection
with a determination of initial or ongoing entitlement to title II
benefits based on disability, or for eligibility or the amount of
benefits under the Supplemental Security Income program of title XVI of
the Social Security Act, and to prevent improper payments. We will
explain to you that we may also use the authorization to obtain wage
and employment information from a payroll data provider for claims
associated with the claim filed, such as a claim for benefits by a
spouse or child. We will also explain that we may use and disclose your
information consistent with applicable Federal law (see, e.g., part 401
of this chapter) and any privacy notices we provide to you.
(ii) We will also inform you that your authorization will remain
effective until the earliest of one of the following occurrences: (A)
you revoke your authorization in writing (see Sec. 404.1588(b)(4));
(B) we have terminated all entitlement for benefits, you have no other
claims or appeals pending under this title, and the period for
appealing the determination or decision terminating entitlement has
lapsed; or (C) there has been an adverse determination or decision on
your claim, you have no other claims or appeals pending under this
title, and the period for appealing the adverse determination or
decision has lapsed.
Subpart P--Determining Disability and Blindness
0
4. The authority citation for subpart P of part 404 is revised to read
as follows:
Authority: 42 U.S.C. 402, 405(a)-(b) and (d)-(h), 416(i),
421(a) and (h)-(j), 422(c), 423, 425, 902(a)(5), and 1320e-3; sec.
211(b), Pub. L. 104-193, 110 Stat. 2105, 2189; sec. 202, Pub. L.
108-203, 118 Stat. 509 (42 U.S.C. 902 note).
0
5. Amend Sec. 404.1588 by redesignating paragraph (b) as paragraph (c)
and adding a new paragraph (b) and revising paragraphs (a) and (c) to
read as follows:
Sec. 404.1588 Your responsibility to tell us of events that may
change your disability status.
(a) Your responsibility to report changes to us. If you are
entitled to cash benefits or to a period of disability because you are
disabled, you should promptly tell us if--
(1) Your condition improves;
(2) You return to work;
(3) You have a new employer;
(4) You increase the amount of your work; or
(5) Your earnings increase.
(b) Effect of authorizing us to obtain your information from
payroll data providers.
(1) We will reduce your reporting responsibilities as described in
paragraphs (a)(4) and (a)(5) of this section if we have your
authorization to obtain wage and employment information from a payroll
data provider (see Sec. 404.703), and we receive your wage and
employment information from your employer(s) through a participating
payroll data provider (see Sec. 404.702).
(2) We will notify you in writing whenever there is a change in
your reporting responsibilities relating to the authorization described
in Sec. 404.703. When we tell you about changes in your reporting
responsibilities, we will also tell you whether you may be subject to a
penalty of nonpayment of benefits (see Sec. 404.459) related to
information we receive from a participating payroll data provider. You
are always required to submit any changes described in paragraphs
(a)(1), (a)(2), and (a)(3) of this section.
(3) When your reporting requirements will change--
(i) If we have your authorization to obtain wage and employment
information from a payroll data provider (see Sec. 404.703), and we
receive your wage and employment information from your employer through
a participating payroll data provider, you will not have to report when
your earnings from that employer increase.
(ii) If we have your authorization to obtain wage and employment
information from a payroll data provider (see Sec. 404.703), but we do
not receive your wage and employment information from your employer
through a participating payroll data provider, we will not reduce your
reporting responsibilities.
(iii) If we have your authorization to obtain wage and employment
information from a payroll data provider (see Sec. 404.703) and you
have more than one employer,
(A) you do not need to report when your earnings increase for an
employer if we receive your wage and employment information for that
employer through a participating payroll data provider, and
(B) you must still report when your earnings increase for an
employer if we do not receive your wage and employment information for
that employer through a participating payroll data provider.
(4) You may revoke your authorization at any time, but you must do
so in writing. We will apply the revocation to all pending or approved
disability claims under this title, as well as all pending or approved
claims under title XVI, from the time we process your revocation. If
you revoke your authorization, all your reporting responsibilities will
resume, and you will again be subject to all related penalties. We will
notify you in writing of these changes.
(c) Our responsibility when you report your work to us. When you or
your representative report changes in your work activity to us under
paragraphs (a)(2), (a)(3), (a)(4), and (a)(5) of this section, we will
issue a receipt to you or your representative.
Part 416--SUPPLEMENTAL SECURITY INCOME FOR THE AGED, BLIND, AND
DISABLED
Subpart G--Reports Required
0
6. The authority citation for subpart G of part 416 is revised to read
as follows:
Authority: 42 U.S.C. 902(a)(5), 1320a-8a, 1320e-3, 1382, 1382a,
1382b, 1382c, and 1383; sec. 211, Pub. L. 93-66, 87 Stat. 154 (42
U.S.C. 1382 note); sec. 202, Pub. L. 108-203, 118 Stat. 509 (42
U.S.C. 902 note).
0
7. Amend Sec. 416.701 by revising the third sentence of paragraph (a)
to read as follows:
Sec. 416.701 Scope of subpart.
(a) * * * This subpart tells you what events you must report; what
your reports must include; when reports are due; and when certain
reporting requirements, and penalties relating to reporting
requirements, do not apply. * * *
* * * * *
0
8. Amend 416.702 by adding, in alphabetical order, the definitions of
``Participating payroll data provider'' and ``Payroll data provider''
to read as follows:
Sec. 416.702 Definitions.
* * * * *
Participating payroll data provider means a payroll data provider
that has established an information exchange with us to provide wage
and employment information.
[[Page 11787]]
Payroll data provider means payroll providers, wage verification
companies, and other commercial or non-commercial entities that collect
and maintain information regarding employment and wages.
* * * * *
0
9. Amend Sec. 416.708 by revising paragraph (c) to read as follows:
Sec. 416.708 What you must report.
* * * * *
(c) A change in income. Unless the circumstances in Sec.
416.709(a) and (c) apply, you must report to us any increase or
decrease in your income and any increase or decrease in the income of--
(1) Your ineligible spouse who lives with you;
(2) Your essential person;
(3) Your parent, if you are an eligible child and your parent lives
with you; or
(4) An ineligible child who lives with you.
However, you need not report an increase in your Social Security
benefits if the increase is only a cost-of-living adjustment. (For a
complete discussion of what we consider income, see subpart K of this
part. See Sec. 416.1323 regarding suspension because of excess
income.) If you receive benefits based on disability, when you or your
representative report changes in your earned income, we will issue a
receipt to you or your representative.
* * * * *
0
10. Add Sec. 416.709 to read as follows:
Sec. 416.709 Reduced reporting requirements when you authorize us to
obtain your information from payroll data providers.
(a) Authorization to obtain data from a payroll data provider. We
will ask you for written authorization to obtain information about you
from a payroll data provider whenever we determine the information is
needed in connection with a determination of initial or ongoing
eligibility for benefits.
(b) Scope and duration. When we ask for your authorization, we will
explain the authorization's scope and duration.
(1) We will explain to you that we will use information obtained
from a payroll data provider, when it is needed, in connection with a
determination of eligibility or the amount of benefits under this
title, or for the initial or ongoing entitlement to disability benefits
under title II of the Social Security Act, and to prevent improper
payments. We will explain to you that we may also use the authorization
to obtain wage and employment information from a payroll data provider
for claims associated with the claim filed, such as an SSI claim by a
spouse or child. We will also explain that we may use and disclose your
information consistent with applicable Federal law (see part 401 of
this chapter) and any privacy notices we provide to you.
(2) We will also inform you that your authorization will remain
effective until the earliest of one of the following occurrences: (A)
you revoke your authorization in writing (see paragraph (c)(4) of this
section); (B) we have terminated all eligibility for benefits and you
have no other claims or appeals pending under this title, and the
period for appealing the determination or decision terminating
entitlement has lapsed; (C) there has been an adverse determination or
decision on your claim, you have no other claims or appeals pending
under this title, and the period for appealing the determination or
decision terminating eligibility has lapsed; or (D) your deeming
relationship ends.
(c) When reporting requirements will change. We will notify you in
writing whenever there is a change in your reporting responsibilities
relating to the authorization described in paragraph (a) of this
section. When we tell you about changes in your reporting
responsibilities, we will also tell you whether you may be subject to a
penalty of ineligibility for cash benefits (see Sec. 416.1340) related
to information we receive from a participating payroll data provider.
We will also tell you when we will find good cause, under section
416.732, for a failure or delay in reporting a change in employer.
(1) If we have your authorization to obtain wage and employment
information from a payroll data provider as described in paragraph (a)
of this section, and we receive your wage and employment information
from your employer(s) through a participating payroll data provider,
you will not have to report changes in your wages paid in cash, as
defined in Sec. 416.1110(a), from that employer(s). Also, you will not
have to report an increase in the amount of work from that employer or
an increase in earnings from that employer, as described in Sec.
416.988(a)(4) and (a)(5). All other reporting requirements still apply.
(2) If we have your authorization to obtain wage and employment
information from a payroll data provider as described in paragraph (a)
of this section, but we do not receive your wage and employment
information from your employer(s) through a participating payroll data
provider, we will not reduce your reporting responsibilities.
(3) If we have your authorization to obtain wage and employment
information from a payroll data provider as described in paragraph (a)
of this section, and you have more than one employer,
(i) you do not need to report wages paid in cash for an employer if
we receive your wage and employment information for that employer
through a participating payroll data provider, and
(ii) you must still report wages paid in cash for an employer if we
do not receive your wage and employment information for that employer
through a participating payroll data provider.
(4) You may revoke your authorization at any time, but you must do
so in writing. We will apply the revocation to all pending or approved
claims under this title as well as all pending or approved disability
claims under title II from the time we process your revocation. If you
revoke your authorization, all your reporting responsibilities will
resume; you will again be subject to all related penalties; and we may
not find good cause, under Sec. 416.732, for a failure to report
timely a change in employer. We will notify you in writing of these
changes.
Subpart I--Determining Disability and Blindness
0
11. The authority citation for subpart I of part 416 is revised to read
as follows:
Authority: 42 U.S.C. 421(m), 902(a)(5), 1382, 1382c, 1382h,
1383, and 1383b; secs. 4(c) and 5, 6(c)-(e), 14(a), and 15, Pub. L.
98-460, 98 Stat. 1794, 1801, 1802, and 1808 (42 U.S.C. 421 note, 423
note, and 1382h note).
0
12. Revise Sec. 416.988to read as follows:
Sec. 416.988 Your responsibility to tell us of events that may change
your disability or blindness status.
(a) If you are entitled to payments because you are disabled or
blind, you should promptly tell us if--
(1) Your condition improves;
(2) You return to work;
(3) You have a new employer;
(4) You increase the amount of your work; or
(5) Your earnings increase.
(b) If we have your authorization to obtain wage and employment
information (see Sec. 416.709(a)) from a payroll data provider (see
Sec. 416.702), and we receive your wage and employment information
from your employer(s) through a participating payroll data provider,
your reporting requirements under paragraphs (a)(4) and (a)(5) will be
reduced as described in Sec. 416.709(c).
[[Page 11788]]
PART 422--ORGANIZATION AND FUNCTIONS OF THE SOCIAL SECURITY
ADMINISTRATION
Subpart B--General Procedures
0
13. The authority citation for subpart B of part 422 is revised to read
as follows:
Authority: 42 U.S.C. 405, 432, 902(a)(5), 1320b-1, 1320b-13, and
1320e-3, and sec. 7213(a)(1)(A) of Pub. L. 108-458.
0
14. Add Sec. 422.150 to read as follows:
Sec. 422.150 Guidelines for Establishing and Maintaining an
Information Exchange with Payroll Data Providers
(a) Guidelines for Establishing an Information Exchange with
Payroll Data Providers. In establishing an information exchange under
section 1184 of the Social Security Act, we will do the following:
(1) Identify the payroll data providers (as defined in Sec. Sec.
404.702 and 416.702 of this chapter) that may be interested in
participating in an information exchange with us.
(2) Review the payroll data providers and consider factors such as:
whether a payroll data provider is able and willing to engage in an
information exchange; what data the payroll data provider could
provide; whether the data from the payroll data provider is
sufficiently accurate, complete, and up-to-date; and any conditions and
limitations associated with our receipt of the data.
(3) Consistent with applicable law and regulations, establish an
information exchange with the selected payroll data provider. The
arrangement between us and the selected payroll data provider will
describe:
(i) the records that will be matched;
(ii) the procedures for the match;
(iii) any requirements established related to accuracy,
completeness, and up-to-date records;
(iv) the procedures for ensuring the administrative, technical, and
physical security of the records matched; and
(v) such other provisions as are necessary.
(4) Prior to receiving payroll data provider information, publish a
notice in the Federal Register that describes the information exchange
and the extent to which the information received through such exchange
is:
(i) relevant and necessary to: (A) accurately determine initial and
ongoing entitlement to, and the amount of, disability benefits under
title II of the Social Security Act; (B) accurately determine
eligibility for, and the amount of, benefits under the Supplemental
Security Income program under title XVI of the Social Security Act; and
(C) prevent improper payments of such benefits; and
(ii) sufficiently accurate, up-to-date, and complete.
(b) Guidelines for Maintaining an Information Exchange with Payroll
Data Providers. We will perform the following activities while we
maintain an established information exchange with a payroll data
provider described in paragraph (a):
(1) Periodically assess whether the data we receive under the
information exchange continues to be accurate, complete, and up-to-
date; and
(2) Monitor compliance with the requirements of the information
exchange described in paragraph (a)(3).
[FR Doc. 2024-02961 Filed 2-14-24; 8:45 am]
BILLING CODE 4191-02-P
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This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.