Last Update: 1/28/03 (Transmittal I-1-44)
A prime purpose of the Social Security Administration's (SSA's) statutory authority to authorize fees for representation is to protect claimants against unreasonable fees. When a representative provides services to a claimant and a nonprofit organization or government agency pays for those services, the risk of unreasonable fees is eliminated.
Social Security Ruling SSR 85-3 modifies fee authorization provisions by providing that SSA need not authorize a fee if all the following conditions are present:
the claimant and affected auxiliary beneficiary(ies) are free of direct or indirect liability to pay a fee or expenses, either in whole or in part, to a representative or to someone else;
the entity which pays the fee and expenses incurred, if any, on behalf of the claimant(s) or beneficiary(ies), is a nonprofit organization or a Federal, State, county, or city agency;
a government entity provides or administers the funds used to pay a fee or any expenses; and
the representative submits a written statement to SSA waiving the right to charge and collect a fee and expenses from a claimant or auxiliary beneficiary(ies).
SSA is not involved in authorizing the amount of out-of-pocket expenses a representative collects. Out-of-pocket expenses are expenses a representative incurs, for which he/she has been paid or expects to be paid. Out-of-pocket expenses include, but are not limited to, the cost of obtaining copies of doctor or hospital reports and a birth and/or death certificate. Therefore, the fee SSA authorizes does not include payment for out-of-pocket expenses.
These expenses are matters for the representative and claimant to settle. However, SSA will question out-of-pocket expenses if it appears that the representative is attempting to circumvent SSA's fee authorization process by designating his/her services as an out-of-pocket expense.
SSA does not consider services in proceedings before State or Federal courts (even if the State court action was to establish relationship or death) to be a proceeding before SSA; therefore, the fee authorization provisions do not apply to court proceedings.
A legal guardian, committee, conservator, or other State court-appointed representative (hereinafter “legal guardian”) may ask the court to approve a fee for services provided in connection with proceedings before SSA. Therefore, if the court orders a fee, SSA's fee authorization is not required.
If a legal guardian asks SSA for information regarding fees, SSA should advise the individual first to ask the State court to approve a fee for all services, including those provided in connection with proceedings before SSA.
If a legal guardian files a fee petition, SSA must advise the legal guardian that SSA will not act on the fee request until the State court has acted.
EXCEPTION: If the legal guardian contacts SSA and states that the court declined to order a fee on the fee request or that he/she is dissatisfied with the fee the court orders, SSA will advise the legal guardian that he/she may file a fee petition with SSA for services provided in proceedings before SSA. If the legal guardian files a fee petition, the legal guardian must furnish SSA:
copies of his/her accounting to the court; and
copies of the fee request and the court's declination or any court ordered fee for his/her services as legal guardian.
Fee Agreement Process Not Applicable to Medicare Cases The fee agreement process can not apply in Medicare cases because there are no “past-due benefits” from which to calculate a representative's fee. A successful appeal of a claim for payment or service in Medicare results only in a decision to:
pay a provider or supplier directly for items or services already provided or rendered,
reimburse a beneficiary for monies the beneficiary already has paid directly to the provider or supplier for an item or service, or
approve authorization for a request for service.
Services Below the Hearing Level for Part B Cases
SSA does not consider services below the hearing level in connection with claims in certain proceedings exclusively before Part B intermediaries or carriers to be services provided in connection with proceedings before SSA; therefore, the fee authorization provisions do not apply to those services.
Fee Petition Filed by a Representative for Services Provided to the Beneficiary
ODAR uses the same procedures and regulations, 20 CFR 404.1700 ff., it uses in a Social Security case, for the approval of a fee petition filed by a Medicare beneficiary's representative. However, because there are no past-due benefits in Medicare cases, there are no direct pay provisions for attorneys.
Fee Petition Filed by a Representative of Any Party Other Than the Beneficiary
The Centers for Medicare & Medicaid Services (CMS) views 20 CFR Part 404, Subparts J and R (42 CFR 405.701(c) and 42 CFR 405.801(d)) to apply only to fee petitions filed by the representative of a beneficiary. Therefore, a fee petition filed by a representative for services he/she provided to any party other than the beneficiary does not require SSA/Office of Disability Adjudication and Review approval.