Social Security:

Beneficiary Payment for Representative Payee Services

HRD-92-112: Published: Jun 29, 1992. Publicly Released: Jun 29, 1992.

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Pursuant to a legislative requirement, GAO reviewed the advantages and disadvantages of the fee that nonprofit organizations collect from Social Security beneficiaries for providing representative payee services.

GAO found that the majority of the organizations participating in the representative payee program: (1) believed that the fee program would encourage organizations to become payees and existing payees to take more Social Security clients, but also might attract for-profit organizations; (2) had difficulty finding payees for certain beneficiaries, especially mentally ill, homeless, and substance-abusing persons; (3) were being reimbursed less than the maximum fee for their services because beneficiaries were unable to afford the fee; and (4) suggested that the cost reimbursement for services be paid by some source other than the beneficiaries and that the fee program should be permanent and open to less-established organizations.

Recommendation for Executive Action

  1. Status: Closed - Not Implemented

    Comments: In August 1994, Congress extended the life of the fee program indefinitely.

    Recommendation: Upon conclusion of the fee program in 1994, the Secretary of Health and Human Services should direct the Commissioner of Social Security to prepare a report for the Senate Committee on Finance and the House Committee on Ways and Means on the program's effectiveness.

    Agency Affected: Department of Health and Human Services


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