2654 Federal Register / Vol. 61, No. 18 / Friday, January 26, 1996 / Proposed Rules

SOCIAL SECURITY ADMINISTRATION

20 CFR Part 404

RIN 0960–AE31

Cycling Payment of Social Security

Benefits

AGENCY: Social Security Administration

(SSA).

ACTION: Proposed rules.

SUMMARY: Historically, social security

benefits generally have been paid on the

3rd of each month. As a result of our

ongoing efforts to improve service to our

customers, we now propose to establish

additional days throughout the month

on which social security benefits will be

paid.

DATES: To be sure that your comments

are considered, we must receive them

no later than March 26, 1996.

ADDRESSES: Comments should be

submitted in writing to the

Commissioner of Social Security, P.O.

Box 1585, Baltimore, MD 21235, sent by

telefax to (410) 966–2830, sent by EMail to ‘‘regulations@ssa.gov,’’ or

delivered to the Division of Regulations

and Rulings, Social Security

Administration, 3–B–1 Operations

Building, 6401 Security Boulevard,

Baltimore, MD 21235, between 8:00 a.m.

and 4:30 p.m. on regular business days.

Comments received may be inspected

during these same hours by making

arrangements with the contact person

shown below.

FOR FURTHER INFORMATION CONTACT: Lois

Berg, Legal Assistant, Division of

Regulations and Rulings, Social Security

Administration, 6401 Security

Boulevard, Baltimore, MD 21235, (410)

965–1713.

SSA plans to host an informational

briefing on payment cycling for

representatives of groups and

organizations, and any others, that are

interested in the initiative. The session

will be designed to provide details and

to answer questions on how SSA

intends to implement payment cycling.

It will not be designed to take public

comments on the proposal. Those who

would like to be invited to the session,

which will be held in February, can

request an invitation from SSA’s Office

of Communications. To reach the office,

call (410) 965–1720 or fax (410) 965–

3903.

SUPPLEMENTARY INFORMATION:

Background

The second phase of the National

Performance Review (NPR), the Federal

Reinventing Government effort, was

announced by the President and Vice

President on December 19, 1994. It was

designed to focus attention on what

each agency does, examining our

mission and looking at our programs

and functions to see if there are ways we

can provide better service to the public

and, at the same time, do our business

in a more cost-effective manner, i.e.,

‘‘make government work better and cost

less.’’ All agencies were asked to

assemble a team to review the programs

and functions of their own agency.

SSA’s team worked closely with a team

of representatives from NPR and the

Office of Management and Budget

(OMB) to develop recommendations for

the Vice President’s consideration.

On April 11, 1995, the White House

formally approved SSA’s reinvention

proposals and officially announced

them the next day. One of these

proposals was to cycle the payment of

benefits.

Recipients of Old-Age, Survivors and

Disability Insurance (OASDI) benefits

and Supplemental Security Income

(SSI) payments currently are paid in the

first few days of each month. While

these payment days have never been

required by the Social Security Act (the

Act), which in §§ 205(i) and 1631(a)(1)

commits the time for making benefit

payments to the discretion of the

Commissioner of Social Security, it has

been our longstanding administrative

practice to make payment on these days.

Monthly benefits are paid to all OASDI

beneficiaries on the same day (generally

the 3rd day of each month for the

preceding month) and to all SSI

beneficiaries on the same day (generally

the 1st day of each month for which the

payment is due).

Over the years, a trend has developed

that has resulted in deterioration of

services we provide face-to-face or over

the telephone on and around our

payment days. This phenomenon is

described fully below and is of

particular concern to us in light of the

Agency’s commitment to provide

‘‘world class’’ service to our

beneficiaries and customers.

Executive Order (E.O.) 12862, issued

on September 11, 1993 mandates that

the standard of quality for services

provided to the public for all

government agencies shall be ‘‘customer

service equal to the best in the

business.’’ This standard has been

incorporated into SSA’s goal of

providing ‘‘world class’’ public service.

For example, when you conduct

business with us, we have set as goals

that:

• When you make an appointment to

talk with someone at one of our field

offices, we will serve you within 10

minutes of the scheduled time.

• When you call our toll-free 800

number, you will get through to it

within 5 minutes of your first try.

SSA’s current practice of paying 47

million beneficiaries within the first 3

days of each month results in a large

surge of work during the first week of

each month. This surge includes a large

number of visitors to field offices and

calls to our toll-free 800 number to

report nonreceipt of a check, question

the amount paid, or ask about other

payment-related issues. Approximately

9 percent of all calls during check week

concern nonreceipt, compared to 3

percent during the rest of the month. As

an example of the surge that occurs

around the current payment days, on

April 3, 1995, 1,091,282 calls were

placed to SSA’s 800 number. On April

14, 1995, the number of calls placed to

our 800 number decreased to 229,022.

It is important to beneficiaries and

customers to be able to reach SSA with

fewer busy signals, and we have

pledged to enable callers to get through

to the 800 number within 5 minutes of

their original attempt. However, in fiscal

year (FY) 1994, during peak periods,

customers encountered busy signals on

SSA’s 800 number 40–63 percent of the

time and had to wait more than 5

minutes to get through about 30 percent

of the time. This delay often occurs at

a time when it may be the most critical

for the individual to reach us, to report

a lost check, for example. Anyone who

experiences a delay in reaching us to

report a lost check also faces a delay in

receiving a replacement check. Since

many beneficiaries rely solely on their

social security benefits, this can be a

real hardship for them.

Our goal is for our customers to have

minimal waits for service when visiting

a social security field office. Today, SSA

does not always meet this goal. In FY

1994 there were 24 million visitors to

our field offices. While the average wait

during check week for individuals with

an appointment was 8 minutes, some

individuals with appointments had to

wait over 2 hours. Thirty-two percent of

the visitors to our offices without

appointments in FY 1994 (typically

people who have questions related to

their payments or who want to report

payment delivery problems) had to wait

more than 30 minutes after arriving to

be served. The average wait during

check week for individuals without

appointments was 16 minutes, although

some individuals without appointments

had to wait over 3 hours. This can be

a particular hardship to those who are

elderly or disabled, as well as to people

who might take off from work to come

to our offices.
Federal Register / Vol. 61, No. 18 / Friday, January 26, 1996 / Proposed Rules 2655

The demographic and resource

challenges we will face over the next 25

years will make it even more difficult

for us to meet our service-delivery

objectives. Currently, we pay 47 million

OASDI and SSI beneficiaries within the

first three days of each month. Due to

the aging of the ‘‘baby boom’’

generation, by the year 2020, we will be

paying about 75 million beneficiaries, a

60 percent increase over today’s

beneficiary population. This will place

an unprecedented demand on our

benefit delivery system.

We are concerned that, in the next 25

years, with the prospect of about 75

million beneficiaries all receiving their

payments on single days, there will be

a serious deterioration in our service to

the public, and we will not be able to

provide the kind of service to which we

are committed. The growth in

beneficiary population is expected to

place an even greater strain on SSA’s

resources at the beginning of the month.

At the same time that the number of

SSA customers is growing, SSA’s

resources are being reduced. Public Law

103–226 mandates an overall 12 percent

reduction of Federal staffing levels by

1999, and this will impact SSA’s

resources. As a result, we are

particularly concerned that we will not

be able to cope with the monthly

workload peaks and still maintain our

goal of being readily accessible to the

public unless we make significant

changes in the way in which we deliver

service.

In the future, the increased number of

beneficiaries and customers plus the

mandated reduction of Federal staffing

levels will have a real impact on the

public’s ability to contact us. This will

be especially hard on individuals during

check week (currently the first week in

each month that benefits are paid) when

the system will be overloaded. Check

week is the time that beneficiaries often

have the most urgent need to reach us

to report nonreceipt or other problems

related to their payment, and to request

a replacement check.

Each attempted phone contact by an

SSA beneficiary, whether over or under

age 65, may represent a personal crisis

due, for example, to nonreceipt of

benefits. Social security benefits affect,

in particular, nearly all individuals age

65 and over in the United States (U.S.).

For a significant proportion of

individuals over age 65, the benefits

represent 90 percent or more of their

total income. For these beneficiaries,

nonreceipt is not an abstract concept or

statistic. It may represent the difference

between paying rent or mortgage

payments on time or late. It may mean

the ability to purchase food. It may

represent lack of gasoline or busfare to

get to a medical appointment. A phone

contact or visit may be by a recent

widow(er) who is reporting the death of

her/his spouse. One successful

telephone call may be all that is

necessary to enable SSA to convert

retirement benefits as a spouse into

higher widow(er)’s benefits. An

unsuccessful phone contact could

prevent us from holding back payments

to the deceased individual and

scheduling benefits to the newly

widowed beneficiary. When individuals

are unsuccessful at reaching us by

telephone, either they, or a friend or

family member, may take time off from

work to come into a field office. Any

additional delay waiting in the field

office causes them to lose even more

time from work.

Today, we are attempting to cope with

the uneven workload pattern in order to

maintain our level of service through a

series of administrative and

management initiatives. For example, at

the beginning of the month, we redeploy

staff from other work to handle the

increase in telephone inquiries which

sometimes exceeds two million calls a

day. While this practice has been

generally successful so far, it will not

continue to be as effective in the future

when the number of beneficiaries

increases substantially and our staffing

decreases.

We are considering all our options in

preparing for this increase in SSA’s

workloads and staff reductions and,

accordingly, are looking for ways to

reengineer our various processes to

allow us to achieve our world class

customer service goals and, at the same

time, increase efficiency and

productivity to the maximum extent

possible. It is clear, though, that SSA’s

goal to achieve a level of world class

customer service cannot be realized

unless our workloads are evened out.

This is critical to providing better access

to SSA’s services for our beneficiaries

and customers.

The release of all OASDI and SSI

payments on single days also has an

adverse effect on certain sectors of the

economy. Based on meetings we held

with representatives of the banking and

business community, the Department of

the Treasury (DT), the Federal Reserve

System (FRS) and the U.S. Postal

Service (USPS), it is clear that the large,

once-a-month OASDI and SSI payment

files are creating many problems. The

banking and business community, the

DT, FRS and the USPS all have to bear

the expense of providing sufficient

resources and processing capacity to

deal with OASDI and SSI payments as

they flow through the national payment

system at the beginning of the month.

This capacity is not needed throughout

the remainder of the month.

Equally significant is the growing

operational risk that is associated with

SSA’s current payment pattern.

Representatives from several large

financial institutions made it clear that

when the social security direct deposit

payment file becomes available for

processing from FRS, they stop all other

business and devote their entire

operation to ensuring the file is

processed quickly and accurately.

Because of the inordinately large

number of payments involved, these

institutions must ensure that nothing

goes wrong as the file passes through

the national payment system and is

deposited into individual customers’

accounts. Any event that adversely

affects the operational capacity of DT,

FRS or a large financial institution in

the 1 to 4 day window prior to the 3rd

of the month may result in the delay or

nonreceipt of literally millions of social

security benefit payments which could

create hardship for SSA beneficiaries.

Leveling the social security payment

files through cycling will help prevent

this operational risk and resulting

hardship.

In order to improve our service to the

public, both now and in the future, we

propose to spread the payment of

OASDI benefits throughout the month,

rather than continue to make all benefit

payments on single days at the

beginning of the month. That is, we will

establish several additional payment

days for each month, and pay the full

monthly benefit to some beneficiaries

on the first of those payment days, to

other beneficiaries on the second of

those payment days, and so forth. The

payment day, or cycle, on which a

beneficiary is paid generally will not be

changed, so that if you are paid on the

second payment day in one month you

will be paid on the second payment day

in each succeeding month as well. This

approach, which we call ‘‘cycling of

payments,’’ will level the workload

peaks associated with our current

practice of paying all benefits on the

same day. Since calls and visits

associated with receipt of the monthly

benefit payment will be distributed

throughout the month, rather than

concentrated in a few days, there will be

shorter waiting times for assistance and

we will be able to achieve or sustain our

world class service to the public.

It is important to note that payment

cycling will not change the way benefits

are computed. We will continue to

follow the same rules in determining

month of entitlement and the payment

amount. People whose benefits are
2656 Federal Register / Vol. 61, No. 18 / Friday, January 26, 1996 / Proposed Rules

cycled will receive the same amount

they would receive if they were paid on

the 3rd of the month.

The benefits to society of

implementing payment cycling are

potentially significant but extremely

difficult to estimate. Cycling will benefit

members of the public in that they will

have better access to SSA services,

including shorter waiting times in field

offices and when calling the 800

number, as SSA’s workloads increase in

the future. Cycling will benefit the

business and banking communities in

that they will be better able to utilize

their resources throughout the month,

processing social security payments on

a weekly basis. Cycling will also reduce

the risk involved in processing large

once-a-month files. If we continue to

pay all beneficiaries on single days

once-a-month, SSA’s service to the

public will deteriorate, and the adverse

impact that the once-a-month payments

have on the business and financial

community will continue, as will the

growing operational risk that goes along

with processing all benefit payments at

one time.

After considering how best to

implement the proposal to cycle the

timing of benefit payments, we are

proposing the following:

1. We will establish three additional

payment days throughout the month

(i.e., the second, third and fourth

Wednesdays of the month) on which

individuals may be paid. This schedule

will alleviate to the maximum extent

possible the current Monday workload

peak which is also now being

experienced by SSA’s toll-free 800

number and field offices when the

payment day falls on Friday, Saturday,

Sunday or Monday, which occurs more

than half of the time.

2. We will implement payment

cycling prospectively only for new

OASDI beneficiaries whose claims are

filed on or after the effective date of the

final rule for payment cycling. We

propose to implement payment cycling

by January 1997. Payments to current

beneficiaries will not be cycled, as they

are already in the established pattern of

receiving their benefits on the third of

the month.

3. We will assign one of the newly

established payment days to each new

OASDI beneficiary based on the date of

birth of the person on whose record

entitlement is established (the insured

individual). Generally, new OASDI

beneficiaries who receive auxiliary or

survivors benefits on an insured

individual’s record will be assigned to

the payment day based on the insured

individual’s date of birth. Insured

individuals who are already being paid

auxiliary or survivor benefits on the 3rd

of the month when payment cycling is

implemented and who subsequently

become entitled on their own record

after payment cycling is implemented

will continue to receive all benefits on

the 3rd. However, all other insured

individuals who become entitled on

their own record and on another record

after payment cycling is implemented

will be paid all benefits to which they

are entitled on the payment day

assigned based on their own date of

birth. Insured individuals born on the

1st through the 10th of the month will

be paid on the second Wednesday of

each month. Insured individuals born

on the 11th through the 20th of the

month will be paid on the third

Wednesday of each month. Insured

individuals born after the 20th of the

month will be paid on the fourth

Wednesday of each month. With only a

few exceptions described below, no new

OASDI beneficiaries will receive

payments on the 3rd of the month.

4. We may accommodate some

beneficiaries currently being paid on the

3rd of the month who voluntarily wish

to change to the payment day that

would be selected by the date of birth

criteria described above, in order to

accelerate the workload leveling effect

of cycling. For example, we plan to

allow them to volunteer to switch if

only one person is being paid on the

record or, if there are other beneficiaries

being paid on the same record, all others

agree, in writing, to the change.

However, once a volunteer is assigned

to a new payment day, that day will be

permanent and the person will not be

allowed to change back to the 3rd of the

month. We will not allow beneficiaries

being paid on one of the three new days

to switch to a different payment day.

5. We will not include persons

receiving SSI payments, and persons

concurrently entitled to both OASDI

and SSI benefits, in payment cycling.

Since SSI is a needs-based program, we

believe we should continue to pay these

individuals as early in the month as

possible. Concurrently entitled

individuals who lose eligibility for SSI

will continue to be paid on the 3rd.

6. We will not apply payment cycling

to OASDI beneficiaries whose income is

deemed to SSI beneficiaries. The reason

is that most deeming cases involve

family members who receive Federal

income maintenance benefits. Those

family units should continue to receive

payments as early in the month as

possible. Likewise, payment cycling

will not apply to OASDI beneficiaries

who, due to their income and/or

resources, are not entitled to SSI but

who are covered by the State in which

they live for Medicaid and the State

covers their Medicare premium. The

Health Care Financing Administration

requested that these OASDI

beneficiaries be paid early in the month.

7. Payment cycling will not apply to

beneficiaries living in a foreign country.

For those beneficiaries being paid by

check, foreign check delivery is often

unreliable. However, with one delivery

day on the 3rd of the month it is easier

to target when checks should be

received than if they were sent four

times throughout the month. Also, since

foreign beneficiaries do not have access

to the 800 number or to SSA’s field

offices in the country where they reside,

these facilities will not be adversely

affected if we continue to pay foreign

beneficiaries on the 3rd of the month.

The presence of a foreign address for

any beneficiary on a social security

record will mean that all beneficiaries

on that record will be paid on the 3rd

of the month. The reason is that, for

operational purposes, we are assigning a

single payment day for all individuals

who receive benefits on the earnings

record of a particular individual. Once

a beneficiary has reported a foreign

address and all individuals receiving

benefits on that account are changed to

the 3rd of the month, the payment day

for all of them will remain the 3rd of the

month even if the person with the

foreign address returns to the U.S. This

is to prevent potential confusion caused

by beneficiaries frequently leaving and

entering the U.S.

8. We will notify affected

beneficiaries in writing of the particular

monthly payment day that is assigned to

them. However, the assignment of a

payment day is not an initial

determination and is not appealable.

Beneficiaries have never been able to

choose their payment day and will not

be able to choose a payment day under

payment cycling.

Early Consultations

We conducted 10 focus group

meetings at 5 locations around the

country to solicit comments and obtain

reaction from the public to cycling

payments throughout the month. Two

meetings were held in each location:

one with current beneficiaries age 21

and over and one with future

beneficiaries age 21 and over. After we

described our future workload

projections and resultant service

delivery deterioration, the vast majority

of future beneficiaries with whom we

met said they would not mind being

paid later in the month.

We also conducted a series of separate

meetings with stakeholders including

representatives from the business
Federal Register / Vol. 61, No. 18 / Friday, January 26, 1996 / Proposed Rules 2657

community, financial community, other

government agencies and advocacy

groups. The overwhelming consensus of

opinion among all stakeholders who

participated was that SSA should

implement some form of payment

cycling.

Request for Information From the

Public

SSA is interested in receiving

comments from the public. We are

interested in your views about the

importance of improved service and

access to SSA personnel and the use of

payment cycling as one means to

achieve better service.

Request for Information From Business

and Financial Community

SSA is particularly interested in the

incremental cost or savings to the

business and financial community of

changing to the proposed payment

schedule. Therefore, we invite

commenters from the business and

financial community to provide data

and analysis quantifying these effects.

The more specific the data, the more

they will help us to assess the cost or

savings or any other effect of this

proposed regulation.

Explanation of Revisions

We propose to add a new § 404.1807

and to amend § 404.1805 to reflect the

policies described above. We propose to

add a new § 404.1807(f) to reflect § 708

of the Act, which provides that payment

will be moved to the prior business day

if the scheduled day for payment falls

on a Saturday, Sunday, or Federal legal

holiday. We also propose to add a new

paragraph (s) to existing § 404.903 to

show that assignment of a monthly

payment day is not an initial

determination and, therefore, it is not

subject to the administrative review

process provided in subpart J of our

regulations or to judicial review.

Electronic Versions

The electronic file of this document is

available on the Federal Bulletin Board

(FBB) at 9 a.m. on the date of

publication in the Federal Register. To

download the file, modem dial (202)

512–1387. The FBB instructions will

explain how to download the file and

the fee. This file is in WordPerfect and

will remain on the FBB during the

comment period.

Regulatory Procedures

E.O. 12866

We have determined that these

proposed regulations meet the criteria

for a significant regulatory action under

E.O. 12866. Therefore, we prepared and

submitted to OMB an assessment of the

potential costs and benefits of this

regulatory action. This assessment also

contains an analysis of alternative

policies we considered and chose not to

adopt. It is available for review by

members of the public by contacting

SSA.

Regulatory Flexibility Act

These regulations affect when social

security recipients receive their

payments. Recipients are not small

entities within the definition of the

Regulatory Flexibility Act. Therefore,

these regulations will not have a

significant impact on a substantial

number of small entities.

Paperwork Reduction Act

These proposed regulations impose

no reporting/recordkeeping

requirements necessitating clearance by

OMB.

(Catalog of Federal Domestic Assistance

Program Nos. 96.001 Social SecurityDisability Insurance; 96.002 Social SecurityRetirement Insurance; 96.003 Social SecuritySpecial Benefits for Persons Aged 72 and

Over; 96.004 Social Security-Survivors

Insurance.)

List of Subjects in 20 CFR Part 404

Administrative Practice and

Procedure, Blind benefits, Old-Age,

Survivors and Disability Benefits;

Reporting and recordkeeping

requirements; Social Security.

Dated: November 30, 1995.

Shirley S. Chater,

Commissioner of Social Security.

For the reasons set forth in the

preamble, subparts J and S of part 404

of chapter III of title 20 of the Code of

Federal Regulations is proposed to be

amended as set forth below.

PART 404—FEDERAL OLD-AGE,

SURVIVORS AND DISABILITY

INSURANCE (1950– )

1. The authority citation for subpart J

of part 404 is revised to read as follows:

Authority: Secs. 201(j), 205(a), (b), (d)-(h),

and (j), 221, 225, and 702(a)(5) of the Social

Security Act (42 U.S.C. 401(j), 405(a), (b), (d)-

(h), and (j), 421, 425 and 902(a)(5)); 31 U.S.C.

3720A; sec. 5, Pub. L. 97–455, 96 Stat. 2500

(42 U.S.C. 405 note); sec. 6(a), (b), and (c)-

(e), Pub. L. 98–460, 98 Stat. 1802 (42 U.S.C.

1383b, 421 note).

2. Section 404.903 is amended by

removing the word ‘‘and’’ at the end of

paragraph (q), and by removing the

period at the end of paragraph (r) and

adding a semicolon and the word ‘‘and’’

in its place, and adding paragraph (s) to

read as follows:

§ 404.903 Administrative actions that are

not initial determinations.

* * * * *

(s) The assignment of a monthly

payment day (see § 404.1807).

3. The authority citation for subpart S

of part 404 is revised to read as follows:

Authority: Secs. 205(a) and (n), 207, and

702(a)(5) of the Social Security Act (42 U.S.C.

405(a) and (n), 407, and 902(a)(5)).

4. Section 404.1805 is amended by

revising paragraph (a)(3) to read as

follows:

§ 404.1805 Paying benefits.

(a) * * *

(3) The time at which the payment or

payments should be made in accordance

with § 404.1807.

* * * * *

5. Section 404.1807 is added to read

as follows:

§ 404.1807 Monthly payment day.

(a) General. Once we have made a

determination or decision that you are

entitled to recurring monthly benefits,

you will be assigned a monthly payment

day. Thereafter, any recurring monthly

benefits which are payable to you will

be certified to the Managing Trustee for

delivery on or before that day of the

month as part of our certification under

§ 404.1805(a)(3). Except as provided in

paragraphs (c)(2) through (c)(6), once

you have been assigned a monthly

payment day, that day will not be

changed.

(b) Assignment of Payment Day. (1)

We will assign the same payment day

for all individuals who receive benefits

on the earnings record of a particular

insured individual. See paragraph (c)(5)

for exception.

(2) The payment day will be selected

based on the day of the month on which

the insured individual was born.

Insured individuals born on the 1st

through the 10th of the month will be

paid on the second Wednesday of each

month. Insured individuals born on the

11th through the 20th of the month will

be paid on the third Wednesday of each

month. Insured individuals born after

the 20th of the month will be paid on

the fourth Wednesday of each month.

See paragraph (c) for exceptions.

(3) We will notify you in writing of

the particular monthly payment day that

is assigned to you.

(c) Exceptions. (1) If you or any other

person became entitled to benefits on

the earnings record of the insured

individual based on an application filed

before (effective date of cycling), you

will continue to receive your benefits on

the 3rd day of the month (but see

paragraph (c)(6) of this section). All
2658 Federal Register / Vol. 61, No. 18 / Friday, January 26, 1996 / Proposed Rules

persons who subsequently become

entitled to benefits on that earnings

record will be assigned to the 3rd day

of the month as the monthly payment

day.

(2) If you or any other person became

entitled to benefits on the earnings

record of the insured individual based

on an application filed after (effective

date of cycling) and also become

entitled to Supplemental Security

Income (SSI) benefits or have income

which is deemed to an SSI beneficiary

(per § 416.1160), all persons who are or

become entitled to benefits on that

earnings record will be assigned to the

3rd day of the month as the monthly

payment day. We will notify you in

writing if your monthly payment day is

being changed to the 3rd of the month

due to this provision.

(3) If you or any other person became

entitled to benefits on the earnings

record of the insured individual based

on an application filed after (effective

date of cycling) and also reside in a

foreign country, all persons who are or

become entitled to benefits on that

earnings record will be assigned to the

3rd day of the month as the monthly

payment day. We will notify you in

writing if your monthly payment day is

being changed to the 3rd of the month

due to this provision.

(4) If you or any other person became

entitled on the earnings record of the

insured individual based on an

application filed after (effective date of

cycling) and are not entitled to SSI but

are or become covered by the State

where you live for Medicaid and the

State covers your Medicare premium, all

persons who are or become entitled to

benefits on that earnings record will be

assigned to the 3rd day of the month as

the monthly payment day. We will

notify you in writing if your monthly

payment day is being changed to the 3rd

of the month due to this provision.

(5) Insured individuals who are

already being paid auxiliary or survivor

benefits on the 3rd of the month and

who become entitled on their own

record after (effective date of cycling)

will continue to receive all benefits on

the 3rd of the month. However, all other

insured individuals entitled on their

own record and on another record after

(effective date of cycling), will be paid

all benefits to which they are entitled on

the payment day assigned based on their

own date of birth.

(6) If the day regularly scheduled for

the delivery of your benefit payment

falls on a Saturday, Sunday, or Federal

legal holiday, you will be paid on the

first preceding day that is not a

Saturday, Sunday, or Federal legal

holiday.

[FR Doc. 96–1508 Filed 1–25–96; 8:45 am]

BILLING CODE 4190–29–P