Number:  114-8
Date:  November 3, 2015

Congress Passes H.R. 1314,
the Bipartisan Budget Act of 2015

On October 28, 2015, the House amended and passed the Senate amendment to H.R. 1314, the Bipartisan Budget Act of 2015, by a vote of 266-167.  The Senate passed the measure on October 30, 2015 by a vote of 64-35, clearing the measure for the President.  The President signed the bill into law on November 2, 2015.

The Bipartisan Budget Act of 2015 reallocates funds from the Old-Age and Survivors Insurance trust fund to the Disability Insurance (DI) trust fund to ensure payment of full disability benefits into 2022; without such a reallocation the DI trust fund would have been depleted in December 2016.  The bill also suspends the debt limit until March 15, 2017; partially rolls back the sequester of discretionary spending scheduled for FY 2016 and FY 2017; and reduces the amount of increase in Medicare Part B premiums for certain beneficiaries in 2016.  In addition, the legislation provides adjustments to civil monetary penalties (CMPs) and makes reforms to the Social Security Program.

Analysis of Appropriation-Related Items

For a 2-year period (FY 2016 and FY 2017), the legislation  increases discretionary spending by $80 billion, split evenly between defense and nondefense programs, above the Budget Control Act (BCA) (P.L. 112‑25) sequester-level spending caps.  Sequester relief of $50 billion will be applied to FY 2016 and $30 billion to FY 2017.

  • In FY 2016, the nondefense spending cap is raised by approximately 5 percent over the BCA spending cap level.
  • In FY 2017, the nondefense spending cap is raised by approximately 3 percent over the BCA spending cap level.

However, actual funding levels for each agency will be determined by an appropriations bill; the current continuing resolution expires on December 11, 2015. 

The bill also includes changes to SSA’s Program Integrity (PI) funding as described below in section 815.

The following are provisions that further affect SSA:


Section 601 – Maintaining 2016 Medicare Part B Premium and Deductible Levels Consistent With Actuarially Fair Rates

  • Sets the monthly Part B premium rate at approximately $123 for 20161 for enrollees age 65 and over in 2016 who are not subject to the “hold harmless” provision.
    • As a part of the base premium, until the transfer of funds from the General Fund to the Supplemental Medical Insurance Fund required to finance this premium change is repaid, such enrollees will be required to pay an additional $3 per month.  Enrollees subject to an Income-Related Monthly Adjustment Amount will be required to pay more than $3.
  • Reauthorizes these provisions for 2017, if there is no cost-of-living-adjustment increase for that year.
  • Effective upon enactment.

Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015

Section 701 – Civil Monetary Penalty Inflation Adjustments 

  • Requires the head of each Federal agency, not later than July 1, 2016, and January 15 of every year thereafter, to adjust for inflation CMPs within the agency’s jurisdiction, and to publish such adjustments in the Federal Register.
  • Generally increases CMPs through inflation adjustments based on the cost-of-living increase in the Consumer Price Index (CPI).  However, the first inflation adjustment will be based on the percentage by which the CPI for 2015 exceeds the CPI of the year in which such CMP was first established (or last adjusted under some other provision of law) and applies the adjustment to the CMP as first established (or last adjusted under some other provision of law). 
  • Requires an agency to make its first CMP adjustment through interim final rulemaking, no later than July 1, 2016, to be effective no later than August 1, 2016.
  • Requires each agency to include in its Agency Financial Report information about CMPs within its jurisdiction, including any CMP adjustment.
  • Effective only for CMPs assessed after the first inflation adjustment.

Social Security Benefit Protection and Opportunity Enhancement Act of 2015

Section 811 – Expansion of Cooperative Disability Investigation (CDI) Units

  • Requires the Commissioner to expand the CDI program to cover all States and Territories no later than October 1, 2022.  This requirement will be subject to the availability of funding and participation of local law enforcement agencies.
  • Requires the Commissioner to issue a progress report 90 days after enactment, and subsequent annual reports until 2022 or until national coverage is achieved, whichever comes first.

Section 812 – Exclusion of Certain Medical Sources of Evidence 

  • Excludes evidence (except for good cause as determined by the Commissioner) furnished by:
    • any individual or entity who has been convicted of a felony under section 208 or section 1632 of the Social Security Act (Act);
    • any individual or entity who has been excluded from participation in any Federal health care program under section 1128 of the Act; or
    • any person with respect to whom a civil money penalty or assessment has been imposed under section 1129 of the Act for the submission of false evidence.
  • Effective upon the Commissioner’s issuance of regulations or 1 year after enactment of this provision, whichever comes first.

Section 813 – New and Stronger Penalties

  • Adds conspiracy to commit Social Security fraud to the list of crimes punishable by fines and imprisonment for up to 5 years.
  • Increases (from up to 5 years of imprisonment to up to 10 years) the punishment upon conviction of a person who fraudulently submits, or causes the submission of, medical or other evidence in connection with any determination for benefits under titles II, VIII, and XVI of the Act and who receives a fee or other income for services performed in connection with any such determination (including a claimant representative, translator, or current or former employee of the Social Security Administration), or who is a physician or other health care provider; and increases to up to $7,500 the amount of CMPs the Commissioner can impose on such individuals.
  • Withholds benefits from individuals during a trial work period (TWP) if they are assessed a CMP for fraudulently concealing work activity. 
  • Effective upon enactment.

Section 814 – References To Social Security and Medicare in Electronic Communications

  • Specifies that internet communication and other electronic communications are included in the activities prohibited from misusing symbols, emblems, or names in reference to Social Security and Medicare.
  • Specifies that each dissemination, viewing, or accessing of a communication misusing one or more words, letters, symbols, or emblems represents a separate violation.
  • Effective upon enactment.

Section 815 – Change to Cap Adjustment Authority

  • Amends section 251(b)(2)(B) of the Balanced Budget and Emergency Deficit Control Act of 1985, as amended by the Budget Control Act of 2011,2 by:
    • adding the cost of co-operative disability investigation units;
    • adding the cost associated with the prosecution of fraud in the programs and operations of the agency by the Special Assistant United States Attorneys to the Program Integrity Fund, and
    • clarifying that work-related continuing disability reviews are included within the definition of continuing disability reviews.
  • Modifies the amounts authorized for program integrity work established in the Balanced Budget Emergency and Deficit Control Act of 1985, as amended by the Budget Control Act of 2011; such amounts, if provided for in an appropriations act, will adjust discretionary spending limits for such year: 
    • for FY2017, from $1,309,000,000 to $1,546,000,000;
    • for FY2018, from $1,309,000,000 to $1,462,000,000;
    • for FY2019, from $1,309,000,000 to $1,410,000,000;
    • for FY2020, no change (remains at $1,309,000,000); and
    • for FY2021, from $1,309,000,000 to $1,302,000,000.
  • Effective upon enactment.

Section 821 – Temporary Reauthorization of Disability Insurance (DI) Demonstration Project Authority

  • Extends authority to initiate demonstration projects under section 234 of the Act until December 31, 2021, and to carry out these projects until December 31, 2022.
  • Effective upon enactment.

Section 822 – Modification of Demonstration Project Authority

  • Requires the Commissioner to provide for voluntary participation (rather than mandatory) in section 234 demonstration projects, and revises the reporting requirements for such demonstration projects. This includes obtaining an informed consent from each participant.
  • Effective upon enactment.

Section 823 – Promoting Opportunity Demonstration Project 

  • Requires that the Commissioner test a benefit offset of $1 for $2 of earnings in excess of a threshold over a 5-year period, beginning not later than January 1, 2017.
    • The threshold amount (the point at which offset begins), is set at the service level trial work month.  This amount may be adjusted upward to reflect an individual’s itemized Impairment Related Work Expenses (IRWE), but it cannot be higher than the substantial gainful activity level.
    • Entitlement to monthly benefits will be terminated the first month after the month in which benefits are reduced to $0, but Medicare coverage will continue for 93 months.

Section 824 – Use of Electronic Payroll Data To Improve Program Administration

  • Allows the Commissioner to enter into information exchanges with payroll data providers to obtain wage data (without the need for independent verification) in order to:
    • efficiently administer the title XVI program and disability benefits under the title II program; and
    • prevent improper payments.
  • Requires the Commissioner to publish a Federal Register notice describing such information exchange and the extent to which it:
    • is necessary and relevant to determine eligibility for, and amount of, benefits;
    • will prevent improper payment of benefits; and
    • is sufficiently accurate, up-to-date, and complete.
  • Authorizes the Commissioner to require individuals to provide authorization to obtain payroll data.3  Individuals who provide such authorization will be afforded protection from certain sanctions and penalties.  Refusal to provide such authorization, or revocation of such authorization, will negate this protection.
  • Requires the Commissioner to publish regulations, no later than 1 year after the date of enactment, prescribing the procedures for the Commissioner’s access to, and use of, information held by payroll providers, including procedures for notifying individuals when they become subject to reduced wage reporting requirements and when reduced requirements no longer apply.
  • Effective 1 year after the date of enactment.

Section 825 – Treatment of Earnings Derived from Services

  • For the purposes of making an initial determination of title II disability, earnings will be presumed to have been earned in the month in which the services were performed, unless the Commissioner can reasonably establish that the earnings were earned in a different month than when they were paid.
  • In any title II disability case other than initial determinations, earnings will be presumed to have been earned in the month in which such earnings were paid. Beneficiaries will be afforded an opportunity to provide additional wage information regarding when services were performed, in situations where the determination may affect eligibility or payment amount.
  • Effective upon the date of enactment or as soon as practicable.

Section 826 – Electronic Reporting of Earnings 

  • Requires the Commissioner, no later than September 30, 2017, to implement a system that would permit DI beneficiaries to report their earnings via electronic means, including telephone and internet, similar to what is available to title XVI recipients, which requires an automated receipt for wage reporting.
  • Effective upon enactment.

Section 831 – Closure of Unintended Loopholes

Deemed Filing

  • Automatically deems a claimant who applies for retirement benefits to have applied for any spousal benefit to which he or she is eligible, for any month in which he or she is eligible.
  • Automatically deems a claimant who applies for a spousal benefit based on age to have applied for his or her retirement benefit for any month in which he or she is eligible.4 
  • Effective for individuals who attain age 62 after December 31, 2015. 

Voluntary Suspension of Benefits

  • Prohibits:
    • any individual from receiving retroactive benefits for a period of voluntary suspension;
    • any individual from receiving benefits based on the earnings of an individual who has suspended his or her benefits, during the period of suspension; and
    • an individual whose benefits are suspended from receiving benefits on any other record, during the period of suspension.
  • Effective for requests for suspension submitted beginning 180 days after the date of enactment.

Section 832 – Requirement for Medical Review

  • In order to make an initial disability decision, the Commissioner will be required to make every reasonable effort to ensure that a qualified physician (where a physical impairment is alleged) or a psychiatrist or psychologist (where a mental impairment is alleged) has completed the medical portion of the case review.
  • Effective for determinations made beginning 1 year after enactment.

Section 833 – Reallocation of Payroll Tax Revenue

  • Increases the portion of the Federal Insurance Contributions Act payroll tax, paid on both wages and self-employment income, allocated to the DI Trust Fund to 0.57 percentage points (for a total of 2.37 percentage points of the total combined 12.4 percent payroll tax) for January 1, 2016 through December 31, 2018, after which the allocation returns to the prior distribution.  This change is projected to extend the date when the DI Trust Fund reserves are depleted from the end of calendar year (CY) 2016 to CY 2022.
  • Effective upon enactment.

Section 834 – Access to Financial Information for Waivers and Adjustments of Recovery

  • Requires the Commissioner to obtain an individual’s authorization to obtain financial institution records before determining whether recovery of such individual’s overpayment may be waived under the “defeats the purpose” provision.  Applies to title II and title XVI waiver requests.
  • Effective for waiver request determinations made on or after the date that is 3 months after the date of enactment.

Section 841 – Interagency Coordination to Improve Program Administration

  • Requires the Commissioner and the Office of Personnel Management (OPM) to enter into an agreement that will enable the Commissioner to withhold past-due disability benefits, in order to offset any Federal Employee Retirement System disability annuity overpayment caused by such disability benefits.
  • Effective for past-due disability benefits payable on or after the date that is 1 year after the date of enactment.

Section 842 – Elimination of Quinquennial Determinations Relating to Wage Credits for Military Service Prior To 1957

  • Eliminates the requirement that the Commissioner make quinquennial determinations for pre-1957 military service wage credits after the 2010 determination.
  • Effective with respect to the review due in 2015.

Section 843 – Certification of Benefits Payable to a Divorced Spouse of a Railroad Worker to the Railroad Retirement Board

  • Allows the Commissioner to electronically certify to the Railroad Retirement Board benefits due to a divorced spouse of a railroad worker.
  • Effective upon enactment.

Section 844 – Technical Amendments to Eliminate Obsolete Provisions

  • Removes two obsolete provisions related to Medicare—subsections 226(j) and 226A(c) of the Act.
  • Effective upon enactment.

Section 845 – Reporting Requirements to Congress

  • Requires the Commissioner to submit to Congress:
    • Fraud and Improper Payment Prevention Report—to be included with the annual budget for fiscal years 2016 through 2021. 
    • Work-Related Continuing Disability Review Report—to be submitted annually to the House Committee on Ways and Means and the Senate Finance Committee, reporting the number of work-related CDRs conducted each year. 
    • Overpayment Waivers Report—to be submitted, not later than January 1 of each CY, to the House Committee on Ways and Means and the Senate Finance Committee. 

Section 846 – Expedited Examination of Administrative Law Judges (ALJ)

  • Permits the Commissioner to request, from OPM, additional examinations for ALJs, the first of which would take place no later than April 1, 2016, and others to take place when requested by the Commissioner, but no later than December 31, 2022.
  • Provides that such examinations shall proceed even if candidates dispute the results with OPM, if the Commissioner determines the delay will pose a significant risk to the adequacy of the ALJ corps. 
  • Requires the Commissioner to pay the full cost associated with each examination.
  • Effective upon enactment.


1 The actual rates will be provided by the Centers for Medicare & Medicaid Services, based on a projection of what the Part B premium would have been if a large segment of the population (around 70 percent) had not been “held harmless” under current law.

2 This provision relates to Congressional appropriation adjustments to the Agency’s discretionary spending limit, which authorizes dedicated program integrity funding for CDRs and redeterminations.
3 In contrast to provisions in current law regarding access to financial data, failure to provide authorization for payroll data could not be used as a basis to deny benefits.  
4 Previously, automatic deeming for both retirement and spousal benefits ended at full retirement age.