New York Codes, Rules and Regulations
Title 14 - DEPARTMENT OF MENTAL HYGIENE
Chapter XIII - Office of Mental Health
Part 522 - Directors of Mental Hygiene Facilities As Representative Payees
Section 522.3 - Legal base

(a) Section 7.09 of the Mental Hygiene Law authorizes the Commissioner to adopt regulations necessary and proper to implement any matter under his or her jurisdiction.

(b) Section 29.23 of the Mental Hygiene Law authorizes directors of facilities operated by the Office of Mental Health to receive or obtain funds or certain personal property due or belonging to individuals receiving services from their facilities up to an amount or value not exceeding twenty-five thousand dollars, and to seek to place, to the extent permissible by law, funds in excess of the appropriate eligibility level for government benefits into a Medicaid exception trust, including a special needs trust or similar device, after the needs of the individual have been met. The statute also mandates the director to seek to establish such a trust when the director receives a windfall payment on behalf of an individual which, in combination with other funds held on behalf of such person, would cause the individual to become ineligible for government benefits.

(c) Section 33.07 of the Mental Hygiene Law requires the Commissioner of the Office of Mental Health to promulgate regulations regarding the management and protection of funds received by facility directors as representative payees for individuals receiving services from their facilities. The statute also mandates the director of a facility operated by the Office of Mental Health to seek to establish a Medicaid exception trust, including a special needs trust or similar device, when the director receives a lump sum retroactive benefit, as defined in the statute, in his or her capacity as representative payee on behalf of an individual which, in combination with other funds held on behalf of such person, would cause the individual to become ineligible for government benefits.

(d) 20 C.F.R. Section 404.2040(d) provides that representative payees may not be required to use benefit payments to satisfy a debt of the beneficiary, if the debt arose prior to the first month for which payments are certified to a payee. If the debt arose prior to this time, a payee may satisfy it only if the current and reasonably foreseeable needs of the beneficiary are met.

(e) Section 43.03 of the Mental Hygiene Law recognizes that although the Commissioner of the Office of Mental Health is authorized to reduce or waive fees in cases of inability to pay or other reason, the patient, and any fiduciary or representative payee holding assets for him or her, or on his or her behalf are jointly and severally liable for the fees for services rendered to the patient.