PART 234—FINANCIAL ASSISTANCE TO INDIVIDUALS Link to an amendment published at 91 FR 48288, July 31, 2026. Authority: 42 U.S.C. 602, 603, 606, and 1302. § 234.11 Assistance in the form of money payments. (a) Federal financial participation is available in money payments made under a State plan under title I, IV-A, X, XIV, or XVI of the Social Security Act to eligible families and individuals. Money payments are payments in cash, checks, or warrants immediately redeemable at par, made to the grantee or his legal representative with no restrictions imposed by the agency on the use of funds by the individual. (b) [Reserved] [36 FR 22238, Nov. 23, 1971, as amended at 51 FR 9206, Mar. 18, 1986] § 234.60 Protective, vendor and two-party payments for dependent children. (a) State plan requirements. (2)(i) Methods will be in effect to identify children whose relatives have demonstrated such an inability to manage funds that payments to the relative have not been or are not currently used in the best interest of the child. This means that the relative has misused funds to such an extent that allowing him or her to manage the AFDC grant is a threat to the health or safety of the child. (ii) States will establish criteria to determine if mismanagement exists. Under this provision, States may elect to use as one criterion a presumption of mismanagement based on a recipient's nonpayment of rent. (iii) Under State agency procedures, the recipient shall be notified whenever a creditor requests a protective, vendor, or two-party payment for mismanagement on the basis of non-payment of bills. (iv) The recipient shall be notified by the agency of a decision not to use a protective, vendor, or two-party payment if such payment has been requested by a creditor. (v) A statement of the specific reasons that demonstrate the need for making protective, vendor, and two-party payments must be placed in the file of the child involved. (3) Criteria will be established to identify the circumstances under which protective, vendor, or two-party payments will be made in whole or in part to: (i) Another individual who is interested in or concerned with the welfare of the child or relative; or (ii) A person or persons furnishing food, living accommodations or other goods, services, or items to or for the child, relative, or essential person. (4) Procedures will be established for making protective, vendor, or two-party payments. Under this provision, part of the payment may be made to the family and part may be made to a protective payee or to a vendor, or part may be made in the form of two-party payments, i.e., checks which are drawn jointly to the order of the recipient and the person furnishing goods, services, or items and negotiable only upon endorsement by both the recipient and the other person. (5)-(6) [Reserved] (7) Standards will be established for selection: (i) Of protective payees, who are interested in or concerned with the recepient's welfare, to act for the recipient in receiving and managing assistance, with the selection of a protective payee being made by the recipient, or with his participation and consent, to the extent possible. If it is in the best interest of the recipient for a staff member of a private agency, of the public welfare department, or of any other appropriate organization to serve as a protective payee, such selection will be made preferably from the staff of an agency or that part of the agency providing protective services for families; and the public welfare department will employ such additional staff as may be necessary to provide protective payees. The selection will not include: The executive head of the agency administering public assistance; the person determining financial eligibility for the family; special investigative or resource staff; or staff handling fiscal processes related to the recipient; or landlords, grocers, or other vendors of goods, services, or items dealing directly with the recipient. (ii) Of such persons providing goods, services, or items with the selection of such persons being made by the recipient, or with his participation and consent, to the extent possible. (8) The agency will undertake and continue special efforts to develop greater ability on the part of the relative to manage funds in such manner as to protect the welfare of the family. (9) Review will be made as frequently as indicated by the individual's circumstances, and at least once every 12 months, of: (i) The need for protective, vendor, and two-party payments; and (ii) The way in which a protective payee's responsibilities are carried out. (10) Provision will be made for termination of protective payments, or payments to a person furnishing goods or services, as follows: (i) When relatives are considered able to manage funds in the best interest of the child, there will be a return to money payment status. (ii) When it appears that need for protective, vendor, or two-party payments will continue or is likely to continue beyond 2 years because all efforts have not resulted in sufficiently improved use of assistance in behalf of the child, judicial appointment of a guardian or other legal representative will be sought and such payments will terminate when the appointment has been made. (11)(i) Opportunity for a fair hearing pursuant to § 205.10 will be given to any individual claiming assistance in relation to the determination: (A) That a protective, vendor, and two-party payment should be made or continued. (B) As to the payee selected. (ii) In cases where the agency has elected the option to presume mismanagement based on a recipient's nonpayment of rent pursuant to paragraph (a)(2)(ii), the agency may also elect the option to provide the opportunity for a fair hearing pursuant to § 205.10 either before or after the manner or form of payment has been changed for these cases. (12) In cases where an individual is sanctioned for failure to participate in WIN, employment search, CWEP, or JOBS, the State plan must provide that when protective or vendor payments are made pursuant to §§ 224.52(a)(1), 238.22, 240.22(a)(1), 240.22(b)(1) and 250.34(d) of this chapter, only paragraphs (a)(7), (a)(9)(ii), and (a)(11)(i) and (ii) of this section will be applicable. Under these circumstances, when protective payments are made, the entire payment will be made to the protective payee; and when vendor payments are made, at least the greater part of the payment will be through this method. However, if after making all reasonable efforts, the State agency is unable to locate an appropriate individual to whom protective payments can be made, the State may continue to make payments on behalf of the remaining members of the assistance unit to the sanctioned caretaker relative. Provision will be made for termination of protective payments, or payments to a person furnishing goods or services, with return to money payment status when adults who refused training, employment, or participation in employment search without good cause either accept training, employment, or employment search or agree to do so. In the case of continuing refusal of the relative to participate, payments will be continued for the children in the home in accordance with this paragraph. (13) For cases in which a caretaker relative fails to meet the eligibility requirements of § 232.11, § 232.12, or § 232.13 of this chapter by failing to assign rights to support or cooperate in determining paternity, securing support, or identifying and providing information to assist the State in pursuing third party liability for medical services, the State plan must provide that only the requirements of paragraphs (a)(7) and (9)(ii) of this section will be applicable. For such cases, the entire amount of the assistance payment will be in the form of protective or vendor payments. These protective or vendor payments will be terminated, with return to money payment status, only upon compliance by the caretaker relative with the eligibility requirements of §§ 232.11, 232.12, and 232.13 of this chapter. However, if after making reasonable efforts, the State agency is unable to locate an appropriate individual to whom protective payments can be made, the State may continue to make payments to the sanctioned caretaker relative on behalf of the remaining members of the assistance unit. (14) If the plan provides for protective, vendor, or two-party payments: (i) The State may use any combination of protective, vendor, or two-party payments (at the request of the recipient), (ii) The request must be in writing from the recipient to whom payment would otherwise be made in an unrestricted manner and must be recorded or retained in the case file, and (iii) The restriction will be discontinued promptly upon the written request of the recipient who initiated it. (b) Federal financial participation. [37 FR 9025, May 4, 1972, as amended at 37 FR 12202, June 20, 1972; 45 FR 20480, Mar. 28, 1980; 47 FR 5682, Feb. 5, 1982; 49 FR 35603, Sept. 10, 1984; 51 FR 9206, Mar. 18, 1986; 54 FR 42244, Oct. 13, 1989; 56 FR 8932, Mar. 4, 1991; 57 FR 30160, July 8, 1992] § 234.70 Protective payments for the aged, blind, or disabled. (a) State plan requirements. (1) Methods will be in effect to determine that needy individuals have, by reason of physical or mental condition, such inability to manage funds that making payment to them would be contrary to their welfare; such methods to include medical or psychological evaluations, or other reports of physical or mental conditions including observation of gross conditions such as extensive paralysis, serious mental retardation, continued disorientation, or severe memory loss. (2) There will be responsibility to assure referral to social services for appropriate action to protect recipients where problems and needs for services and care of the recipients are manifestly beyond the ability of the protective payee to handle. (See paragraph (a)(5) of this section.) (3) Standards will be established for selection of protective payees who are interested in or concerned with the individual's welfare, to act for the individual in receiving and managing assistance, with the selection of a protective payee being made by the individual, or with his participation and consent, to the extent possible. If it is in the best interest of the individual for a staff member of a private agency, of the public welfare department, or of any other appropriate organization to serve as a protective payee, such selection will be made preferably from the staff of an agency or that part of the agency providing protective services for families or for the disabled or aged group of which the recipient is a member; and such staff of the public welfare department will be utilized only to the extent that the department has adequate staff for this purpose. The selection will not include: The executive head of the agency administering public assistance; the person determining financial eligibility for the individual; special investigative or resource staff, or staff handling fiscal processes related to the recipient; or landlords, grocers, or other vendors of goods or services dealing directly with the recipient—such as the proprietor, administrator or fiscal agent of a nursing home, or social care, medical or nonmedical institution, except for the superintendent of a public institution for mental diseases or a public institution for the mentally retarded, or the designee of such superintendent, when no other suitable protective payee can be found and there are appropriate staff available to assist the superintendent in carrying out the protective payment function. (4) Protective payments will be made only in cases in which the assistance payment, with other available income, meets all the needs of the individual, using the State's standards for assistance for the pertinent program, not standards for protective payment cases only. (5) The agency will undertake and continue special efforts to protect the welfare of such individuals and to improve, to the extent possible, their capacity for self-care and to manage funds. (6) Reconsideration of the need for protective payments and the way in which a protective payee's responsibilities are carried out will be as frequent as indicated by the individual's circumstances and at least every 6 months. (7) Provision will be made for appropriate termination of protective payments as follows: (i) When individuals are considered able to manage funds in their best interest, there will be a return to money payment status. (ii) When a judicial appointment of a guardian or other legal representative appears to serve the best interest of the individual, such appointment will be sought and the protective payment will terminate when the appointment has been made. (8) Opportunity for a fair hearing will be given to any individual claiming assistance in relation to the determination that a protective payment should be made or continued, and in relation to the payee selected. (b) Federal financial participation. [34 FR 1323, Jan. 28, 1969] § 234.75 Rent payments to public housing agencies. At the option of a State, if its plan approved under title I, X, XIV, or XVI of the Social Security Act so provides, Federal financial participation under such title is available in rent payments made directly to a public housing agency on behalf of a recipient or a group or groups of recipients of OAA, AB, APTD, or AABD. Such Federal financial participation is available in rent payments only to the extent that they do not exceed the amount included for rent under the State's standard of assistance or the amount of rent due under applicable law, whichever is less. [38 FR 26380, Sept. 20, 1973] § 234.120 Federal financial participation. Federal financial participation is available in assistance payments made under a State plan under title I, IV-A, X, XIV, or XVI of the Social Security Act to any family or individual for periods beginning with the month in which they meet all eligibility conditions under the plan and in which an application has been received by the agency. Such assistance payments include: (a) Money payments (titles I, IV-A, X, XIV, and XVI, see § 234.11 of this chapter); (b) Protective and vendor payments for dependent children (title IV-A, see § 234.60 of this chapter); (c) Protective payments for the aged, blind, or disabled (titles I, X, XIV, and XVI, see § 234.70 of this chapter); (d) AFDC foster care payments (title IV-A, see § 233.110 of this chapter); (e) Vendor payments for institutional services in intermediate care facilities (titles I, X, XIV, and XVI), but only in a State that did not, as of January 1, 1972, have an approved plan under title XIX of the act, and only until such State has such a plan in effect (see § 234.130 of this chapter); (f) Emergency assistance to needy families with children (title IV-A, see § 233.120 of this chapter); (g) Vendor payments for home repairs (titles I, IV-A, X, XIV, and XVI, see § 233.20(c) of this chapter); and (h) Rent payments to public housing agencies (titles I, X, XIV, and XVI, see § 234.75 of this chapter). [38 FR 26380, Sept. 20, 1973] § 234.130 Assistance in the form of institutional services in intermediate care facilities. (a) Applicability and State plan requirements. (1) Provide that such benefits will be provided only to individuals who: (i) Are entitled (or would, if not receiving institutional services in intermediate care facilities, be entitled) to receive assistance, under the State plan, in the form of money payments; and (ii) Because of their physical or mental condition (or both) require living accommodations and care which, as a practical matter, can be made available to them only through institutional facilities; and (iii) Do not have such an illness, disease, injury, or other condition as to require the degree of care and treatment which a hospital or skilled nursing home (as that term is employed in title XIX) is designed to provide. (2) Provide that, in determining financial eligibility for benefits in the form of institutional services in intermediate care facilities, available income will be applied, first for personal and incidental needs including clothing, and that any remaining income will be applied to the costs of care in the intermediate care facility. (3) Provide methods of administration that include: (i) Placing of responsibility, within the State agency, with one or more staff members with sufficient staff time exclusive of other duties to direct and guide the agency's activities with respect to services in intermediate care facilities, including arrangements for consultation and working relationships with the State standard-setting authority and State agencies responsible for mental health and for mental retardation; (ii) In relation to authorization of benefits, provisions for evaluation by a physician of the individual's physical and mental condition and the kinds and amounts of care he requires; evaluation by the agency worker of the resources available in the home, family and community; and participation by the recipient in determining where he is to receive care, except that in the case of services being provided in a Christian Science Sanatorium, certification by a qualified Christian Science practitioner that the individual meets the requirements specified in paragraphs (a)(1) (ii) and (iii) of this section may be substituted for the evaluation by a physician; (iii) Provisions for redetermination at least semiannually that the individual is properly a recipient of intermediate care. (4) Provide for regular, periodic review and reevaluation no less often than annually (by or on behalf of the State agency administering the plan and in addition to the activities described in paragraph (a)(3) of this section) of recipients in intermediate care facilities to determine whether their current physical and mental conditions are such as to indicate continued placement in the intermediate care facility, whether the services actually rendered are adequate and responsive to the conditions and needs identified, and whether a change to other living arrangements, or other institutional facilities (including skilled nursing homes) is indicated. Such reviews must be followed by appropriate action on the part of the State agency administering the plan. They must be conducted by or under the supervision of a physician with participation by a registered professional nurse and other appropriate medical and social service personnel not employed by or having a financial interest in the facility, except that, in the case of recipients who have elected care in a Christian Science sanatorium, review by a physician or other medical personnel is not required. (5) Provide that all services with respect to social and related problems which the agency makes available to applicants and recipients of assistance under the plan will be equally available to all applicants for and recipients of benefits in the form of institutional services in intermediate care facilities. (6) Specify the types of facilities, however described, that will qualify under the State plan for participation as intermediate care facilities, and provide for availability to the Department of Health and Human Services, upon request of (i) copies of the State's requirements for licensing of such facilities, (ii) any requirements imposed by the State in addition to licensing and to definition of intermediate care facilities, and (iii) a description of the manner in which such requirements are applied and enforced including copies of agreements or contracts, if any, with the licensing authority for this purpose. (7) Provide for and describe methods of determining amounts of vendor payments to intermediate care facilities which systematically relate amounts of the payment to the kinds, levels, and quantities of services provided to the recipients by the institutions and to the cost of providing such services. (b) Other requirements. (c) Federal financial participation. (2) For the period from January 1, 1972, to the date on which a determination is made under the provisions of 42 CFR 449.33 as to a facility's eligibility to receive payments for intermediate care facility services under the medical assistance program, title XIX of the Act, but not later than 12 months following the effective date of these regulations, Federal financial participation in payments for such services under title XIX is governed by the provisions of this section, applied to State plans under title XIX. (d) Definition of terms. (1) Institutional services. institutional services, institutional services, (2) Distinct part of an institution. distinct part (i) Identifiable unit. distinct part (ii) Staff. (iii) Shared facilities and services. (iv) Transfers between distinct parts. (3) Intermediate care facility. (i) Is licensed, under State law to provide the residents thereof, on a regular basis, the range or level of care and services as defined in paragraph (d)(4) of this section, which is suitable to the needs of individuals who: ( a ( b (ii) Does not provide the degree of care required to be provided by a skilled nursing home furnishing services under a State plan approved under title XIX: (iii) Meets such standards of safety and sanitation as are applicable to nursing homes under State law; and (iv) Regularly provides a level of care and service beyond board and room. The term intermediate care facility (4) Range or level of care and services. (i) Admission, transfer, and discharge of residents. ( a ( b ( c (ii) Personal care and protective services. ( a ( b ( c (iii) Social services. (iv) Activities. (v) Food service. (vi) Special diets. (vii) Health services. ( a ( b ( c a ( d ( e) ( f ( 1 ( 2 ( 3 (viii) Living accommodations. (ix) Administration and management. [35 FR 8990, June 10, 1970, as amended at 39 FR 2220, Jan. 17, 1974; 39 FR 8918, Mar. 7, 1974]