Dear NAELA Members:
On June 25, 2019, SSA issued a new POMS on fee approvals, which in the examples provided by SSA, states that preparation/advising of certain trusts by attorneys for individuals who are now receiving, or may in the future receive SSI, requires fee approval from SSA. Because this new guidance is part of SSA’s operations manual for caseworkers, SSA did not go through the formal rule-making process. NAELA and other organizations had no opportunity to provide public comments.
NAELA has formed a working group with organizations, including the Special Needs Alliance, the Academy of Special Needs Planners, and the National Organization for Social Security Representatives. Members of the group are in contact with SSA. In conjunction with these discussions, we have received the following statement from Janet Walker, Associate Commissioner, Office of Public Service and Operations Support at SSA:
Our current policy requires us to authorize a representative’s fee when the representative’s services are performed in connection with a claim before the agency. The types of services that generally require us to authorize a fee include, but are not limited to an application for benefits, requests for revised earnings record,
etc. We are generally not required to authorize a fee for services that are separate from a claim such as preparation of legal documents for adoption, guardianship, etc. Regarding special needs trusts, when the modification or creation of a trust, in connection with a claim, impacts SSI eligibility, we must authorize the fee. Alternatively, an attorney may establish a trust for an individual who is receiving benefits without the need for our authorization of the fee, so long as the trust wasn’t established to protect SSI eligibility.
While it is important to note that this is only one official’s interpretation of the new POMS, it does seem to indicate that the Social Security Administration is seeking to require fee petitions in cases where attorneys draft special needs trusts for SSI recipients, regardless of whether the attorney is actually representing the SSI claimant before the Social Security Administration.
NAELA has concerns that the new POMS will have a chilling effect on the practice of special needs planning due to the threats of disbarment or criminal penalties for attorneys. Without these attorneys, SSI beneficiaries will have fewer or no options when seeking assistance with trust drafting. The average wait time for fee approval varies by region, but SSA usually takes months and sometimes over a year to grant or deny fee petitions. Additionally, SSA has no fee schedule to guide caseworkers in assessing whether a fee is reasonable for trust drafting work.
NAELA, along with our coalition partners, is presently conducting its due diligence to determine
the legal implications of and the best course of action to respond to SSA's actions, including the potential for litigation. While we understand the anxiety that this uncertainty is causing, it is essential that any action taken is carefully considered. We plan to have more information to share in the coming weeks. NAELA has published an analysis of the new POMS in an article as well as a webinar. Both are available to members. See below for links to access both.
It is important to note that NAELA is aware of at least two attorneys whose fees and retainer agreements for trust preparation have been requested by the SSA in the Chicago region. This indicates that the SSA will enforce the new POMS.
If you or your client receives a notice from SSA requesting a trust fee agreement or other information that you think is related to this new POMS, please consider redacting and sharing with NAELA by contacting David Goldfarb, NAELA’s Senior Public Policy Manager.
Next Steps in Practice
NAELA believes it is very important for all member attorneys to read and understand the new POMS, related existing POMS, and the Code of Federal Regulations (CFR) as it relates to representation and fee approval.
Specifically, members should learn what constitutes a “representative,” “representative services,” and a “claimant.” These terms are defined in various POMS and in the CFR. We encourage members to learn about the SSA fee approval process, which is generally better understood by those who regularly appear on behalf of SSA claimants. Information about the fee approval process can be found here: SSA’s Fee Authorization Processes.
The following general comments are intended to give you some touch points for consideration going forward:
- If you have been formally authorized as a representative by the SSA (i.e. filled out an appointment of representative form), you should seriously consider having fees approved when you advise clients about eligibility and prepare trust documents. It may not be enough under the new POMS to only seek the approval when you represent a claimant in SSA application, redetermination, hearing, or appeal.
- If, after considering the new POMS and the CFR, you believe the agency has reason to seek fee approval, then the new POMS would require you to follow the fee approval process when you are drafting trusts for clients who are receiving SSI in addition to when you represent clients before the SSA.
- If, after considering the new POMS and the CFR, you or your firm chooses not to seek fee approval in particular cases that appear to be less clear-cut, taking measures to ensure that the work you do is not within the new POMS examples, or building effective administrative systems (e.g. through your documents and fee agreements) may be means to defend yourself should the SSA consider you a representative or otherwise subject to this POMS. Detailed timekeeping, separate files for trust-related and non-trust related work for the same clients, and fee approval by state courts with jurisdiction over a claimant may be helpful.
Where to Learn More
On Saturday, November 16, the NAELA Summit
will be holding a session entitled "The New POMS on Fee Authorization, What Do We Do Now?" The presenters will review the new POMS in context and discuss best practices for attorneys to follow. Register for the Summit.
In addition, the NAELA News Online article by Kevin Urbatsch, “The New POMS on Attorney Fees” is available here. And NAELA’s webinar on the new POMS presented by Kevin Urbatsch and Blaine Brockman can be accessed here. Both are available to NAELA members without charge.
You must be signed in with your NAELA username and password to access the article and webinar. If you need help with your NAELA login information, please contact us.
Jennifer L. VanderVeen, CELA, CAP, Fellow