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What Is a Representative Payee for SSDI or SSI?

Learn when Social Security will send your disability benefits to a representative payee.

If you are approved for disability benefits, your monthly check may be sent directly to you or to a representative payee (“rep payee”). Why would a check be sent to someone not getting benefits? In most cases, a representative payee is chosen because the disabled person needs someone to help him or her manage funds. This can be due to mental disability, substance abuse, or a physical inability to handle banking, shopping or other day-to-day activities.

Rep payees are common among SSI beneficiaries, and are often the best choice to manage monthly funds effectively.

What Does a Representative Payee Do?

A rep payee can have minimal involvement in a disabled person’s life or can direct nearly all of a disability beneficiaries funds. It depends a lot on the individual situation. A few examples of Payee duties include:

  • Use disability benefits to pay for beneficiary’s needs (rent, groceries, transportation)
  • Save extra money so that disability benefits become a savings account
  • Report changes or any event that might affect disability payments
  • Help pay for the disabled person’s personal needs (hair care, medical transport)
  • Assist the disabled person as a case manager by paying for medical care
  • Helps the beneficiary save up for a big purchase
  • Make sure Social Security Disability payments are kept in a secure account
  • Reports regularly to SSA about spending and money management
  • Paying for housing each month by sending in a portion of the SSI benefit check

Of course, there are as many rep payee situations that arise as there are different types of disabilities. A representative payee may make the smallest of financial decisions, such as whether to put off making car payment in order to cover rent, or may only participate in the most basic financial decisions like whether to change banks. 

The decisions a rep payee makes are somewhat dependent on whether the disabled person (“beneficiary”) has multiple sources of income (as in many SSDI benefits) or a very lean income (such as Supplemental Security Income, or SSI benefits). With a typical SSI monthly check, most of the funds will go to housing and food, with some left over for transportation and savings.

When Does Social Security Require a Representative Payee?

There are two situations in which Social Security regulations require that disability benefits be paid to a representative payee. First, representative payees are appointed to receive and manage benefits that are payable to a minor. 

Second, if you are an adult or an emancipated minor, a representative payee will be appointed to manage your benefits if, due to your physical health, you are unable to direct the use of your funds. Or, if your judgment is impaired due to your illness, there is a reasonable possibility that you will not have the capacity to make sound financial decisions to take care of yourself. If at some point your health improves and you are still disabled and eligible for benefits, then your benefits may be paid directly to you at that time.

What Are the Exact Duties of a Rep Payee?

On a basic level, the payee must have information in order to manage the disabled person’s funds. He or she must know: What are the beneficiaries most basic financial needs? This requires regular meetings and exchange of information between the payee and Social Security beneficiary.

Next, a rep payee must attempt to save some money every month on behalf of the disabled person so a savings account can grow for future needs. A payee should, ideally, keep a record of monthly expenses. This type of bookkeeping is important because benefit checks, for example, may change slightly in amount or a big expense may come up that has to be covered over several months.

The payee must be aware of any changes to the disabled person’s status that could affect getting monthly payments and report any changes to SSA (Social Security Administration) offices. Any changes to the representative payee’s status or ability to assist in managing funds also need to be reported by the payee to the SSA. A representative payee also completes SSA reports to account for money received and how it was spent, making sure to return any saved payments if the payee should relinquish (give up) his or her position as payee.

Do these duties sound like a lot of work? They are! Bookkeeping isn’t easy, which is why anyone receiving SSI or SSDI (and retirement benefits, as well) should consider that their payee is doing a job even if it is unpaid. In some cases, beneficiaries decided to provide a small stipend to the payee in gratitude, but in many cases a rep payee won’t ask for any payment.

While beneficiaries have little influence over who their payee may be, it is possible to contact SSA if the beneficiary believes that her funds are being mismanaged. At the same time, if the disabled person believes she no longer needs a payee, she may contact SSA and ask for the representative payee to be removed. In this case, it is helpful to get a doctor’s letter stating why the beneficiary is now competent to manage benefit payments.

Representative Payee FAQs 

What is a representative payee?

Any person, whether someone with legal guardianship or a trusted friend, who agrees to manage Social Security disability (SSI or SSDI) or retirement funds for a beneficiary. This person does not need to be an attorney, legal guardian, social services professional or organizational representative payee. It can be as simple as the SSA assigning guardianship of funds to disabled person’s mother or adult child. 

What is a beneficiary?

A beneficiary is anyone who receives SSI, SSDI or retirement funds – in other words a monthly check and/or medical insurance. The beneficiary’s needs include having someone (who could be the beneficiary himself) manage the monthly benefit check. Beneficiaries are sometimes also called “disabled person” and during the application process (before they are approved) “claimant” or “applicant.”

Who needs a representative payee?

A Social Security Rep Payee is a good idea for a lot of individuals who qualify for SSI because often SSI is the only source of income. A disabled person cannot qualify for SSI unless they have few resources, so the monthly check is often the only income. For this reason, the funds are very important and need to be managed well. In addition, anyone with a mental health problem (such as a mood disorder like bipolar disease or a thought disorder like schizophrenia) severe enough to qualify will probably need a Payee.

Younger people, under 25, may need help managing finances. Anyone who qualifies for SSI or SSDI due to an intellectual impairment (very low IQ) or head injury that affects judgment, and anyone with a substance abuse problem, should have a Payee.

Lastly, a person with very limited mobility or an impairment that causes pain or extreme fatigue, may benefit from having someone else take care of day-to-day bill paying and money management. This list is long because someone who is disabled is, by definition, impaired—often with severe health issues. For this reason, many SSI and SSDI beneficiaries are assigned a representative payee.

Who can be my representative payee?

A legal guardian, a disability attorney, a family member or even a trusted friend—all can become rep payees. The payment may even go to a Social Service agency if there is no one else to manage the Social Security beneficiary payment. 

Can I be my own payee for SSI?

Most people receiving SSI funds, even if an attorney was involved in the case or if they’ve recently turned 18, can be payees for their own funds. SSI benefits are more likely to be associated with representative payees for a variety of reasons, but SSA benefits of all kinds include payees, such as retirement. 

The main factor in who becomes the Payee is simply the ability of the disabled person to manage their own social security benefit—and usually mental health, intellectual deficit or limited physical ability are the reasons for a payee to become involved.

How do I change my representative payee?

If you are assigned a payee who you believe isn’t serving your interests, or if you feel you are capable of being your own SSDI or SSI payee, you may send a letter to the Social Security Administration requesting a change. It is helpful to get a letter from a doctor who knows you well and/or the attorney who handled your claim and submit a letter(s) to the SSA office as soon as possible.

When you apply for benefits, you may express your wish to have a particular person become your representative payee. The SSA office may not choose that person, however. The decision about who will become your representative payee is made by the SSA office after the medical part of your disability claim is approved. However, you can put a note in your file at any time to indicate who you think should manage any monthly check you might receive.

What is the Representative Payee Program?

The Representative Payee Program administers all of the rules that payees are required to follow. A payee has many responsibilities and must report income, spending and changes to status or may be removed from the position. SSA notes on their website that they prefer assigning friends or family as payee reps but in cases where there is no one available, they will assign an organizational payee or a person with a professional relationship to the beneficiary, such as a judge or attorney.

How is the representative payee monitored?

Representative payee reviews are conducted by the SSA office on a regular basis. In addition, the beneficiary (or “payee”) may contact SSA up to once per year to receive a representative payee report about how their payee is doing. This can be accomplished by mail, phone, or online.

Annual representative payee reports are no longer required by Social Security for certain categories, such as beneficiary spouse, natural parents of a minor child, legal guardians of a minor child or legal or natural or adoptive parents of an adult child residing in the same household. For example, an adult disabled person living in a care facility with a representative payee would have that payee monitored, but an adult disabled person living with her mother, who is the rep payee, would not have payment management overseen by SSA.

What is an organizational payee?

This term refers to someone who works for an agency or organization and manages a beneficiary’s funds as part of a professional, typically paid, position. For example, a social worker may manage benefits for someone on her caseload who has no trustworthy friends or family to help manage funds. The organizational payee agencies or institutions must fill out regular reports online.

Do I have to have a representative payee for my disability payments?

If you are an adult, when the claims examiner reviews your claim to determine whether you are eligible for benefits, the examiner reviews all the information in your claim file to determine your capability to manage money. Capability means that you have the physical and mental capacity and judgment to either use or direct someone to use your funds to take care of your current needs. This includes prioritizing your basic needs of shelter, food, clothing, personal care items, and medical and dental care first. 

If it is determined that you are not able to do this because of your medical or psychiatric condition, then the Social Security Administration must pay your benefits to a representative payee.

How can I appeal a representative payee decision?

If you have been advised that a representative payee will be appointed to receive your benefits and you believe that you are capable of making appropriate financial decisions to care for yourself, it can be helpful to discuss the matter with a physician who knows you well. If your doctor agrees that you are capable of handling your funds, then it could be appropriate to appeal, submitting a letter from the doctor that explains why the doctor believes you are capable of handling your own funds.  

If you are under age 18, unless you have been legally emancipated, you must have a representative payee to receive and manage your Social Security disability payments. While theoretically a minor could appeal this decision, the likelihood of winning such an appeal is virtually nil.

While you can appeal the need for a payee, if it is found that you need a payee, you cannot appeal the choice of who serves as your payee. You can, of course, provide input into the selection process, but the final decision belongs to Social Security.

Representative Payees Are an Important Part of SSI and SSDI

Managing money is difficult for healthy people who have plenty of it, so for someone dealing with injury or illness and limited funds, money management can be tough. With a small check of under $1,000 per month (the typical SSI or SSDI benefit), it’s a real challenge to cover basic expenses and put savings aside. Having a representative payee is usually an advantage for most beneficiaries who receive SSI. Naturally, it’s especially important that the rep payee is trustworthy and skilled at managing money.

Remember that all representative payees are doing a job, and most of them do it with integrity. But if you have concerns your Social Security funds are being mismanaged you may contact your SSA office at any time, or another trusted professional like your disability attorney.

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