Policy Document: Social Security Number (SSN) Collection and Distribution Procedure for Human Subject Incentive Program (HSIP)
FAQ Document: HSIP SSN policy change FAQ
I. INTRODUCTION
The Human Subject Incentive Program (HSIP) has introduced diverse methods for study teams to offer payments to individuals in exchange for their participation in research. These methods include (via direct mail to participants from HSIP) checks and physical and virtual reloadable prepaid cards and (via distribution to participants from study teams) cash, physical single-use prepaid cards, and payment coupons.
Payments can only be made through HSIP to research participants who are US citizens or resident aliens. These individuals should have a TIN (tax identification number), which is usually a social security number (SSN).
This document outlines a policy change. The prior policy required that study teams collect participant SSNs based on the total payment amount of an individual study over the duration of a calendar year. The new policy requires that study teams collect SSNs based on the total payment amount to an individual participant across all studies for which they are compensated in a calendar year. Participant payments will be monitored by HSIP via weekly audits to determine whether a participant has received $401 or more across all University of Michigan studies for which they received payment for participation during a calendar year. When a participant has received $401 or more during a calendar year, the participant will be required to provide their SSN to the University if they wish to continue receiving payment for their study participation during the current calendar year. For this approach to be effective, participant name and address will need to be collected for all payments to research participants. This new approach is expected to create more flexibility for study teams in compensating research participants and may improve recruitment and retention, particularly of groups frequently underrepresented in research.
Requests for incentive payments will continue to occur through HSIP via established University financial systems and processes. HSIP will continue to offer the existing methods of incentive payments (checks, physical and virtual reloadable prepaid cards, cash, physical single-use prepaid cards, and payment coupons).
II. METHODS OF DISTRIBUTING PAYMENTS TO PARTICIPANTS
a. Direct Mail to Participants from HSIP: The HSIP office mails checks made payable to participants and physical and virtual reloadable prepaid cards to participants directly. In this arrangement, study teams collect participant personal information (name, address, and, when necessary, SSN) and provide it to the HSIP office. HSIP uses this information to track payments and determine if the participant has received $401 or more across studies in a calendar year.
b. Distribution to Participants from Study Teams: Study teams can distribute payments to participants directly. In this arrangement, the HSIP office gives study teams funds in the form of cash, physical single-use prepaid cards, or payment coupons (which study teams distribute directly to participants) or checks made payable to study teams (which study teams use to purchase third party incentives (e.g., Amazon or Starbucks gift cards, etc.) to distribute directly to participants). In this arrangement, HSIP has released funds on behalf of the University to study teams prior to the University obtaining the participant’s personal information (name, address, and, when necessary, SSN) that is necessary to track payments and conduct the necessary audits. As such, it is imperative that study teams collect the required participant personal information and provide it to the HSIP office within 30 days of payment distribution to research participants. As noted in Section I, physical and virtual reloadable prepaid cards and checks made payable to participants cannot be distributed directly to participants by study teams (they must be mailed to participants by the HSIP office).
III. NEW PAYMENT THRESHOLD FOR COLLECTING SOCIAL SECURITY NUMBERS
a. SSN Requirement: If a participant has received $401 or more across all studies during a single calendar year, the participant is required to provide their SSN to receive any additional payments during the calendar year. The study for which the participant is currently seeking to receive payment when reaching this threshold is responsible for collecting the SSN to enable any payment that places the participant’s total payment during a calendar year at $401 or more.
b. Payment Tiers: Studies are grouped into two tiers based on total payment over the course of the entire study: $400 or less or $401 or more. Studies with a total payment that could be $401 or more in a calendar year must collect SSNs before the first payment for participation is distributed.
c. Informed Consent: Participants must be explicitly notified in the informed consent document that providing the University a TIN or SSN is required in order to be paid if the study for which they are currently consenting has a total potential payment of $401 or more in a calendar year. For studies that do not provide a total potential payment of $401 or more in a calendar year, participants must be explicitly notified in the informed consent document that providing the University a TIN or SSN is required in order to be paid if they reach a total payment of $401 or more across multiple studies in a single calendar year and wish to be paid for the current study. Individuals who have reached a total payment from the University of $400 in a calendar year but decline to provide their TIN or SSN may continue to participate in studies but cannot receive any payments for their participation in any study through the remainder of the calendar year.
IV. OPERATIONAL PROCESSES
a. Regular Audits: HSIP conducts weekly audits of all payments made to participants.
b. Collecting payment information: For studies classified as Tier A study teams are expected to ask participants for their names and addresses when payment is made. For studies classified as Tier B study teams are expected to ask participants for their names, addresses and SSN when payment is made. Refusal by participants to provide this information should be documented.
c. Payment Alert: When a participant's total payment across studies reaches a cumulative total of $300 in a calendar year, HSIP will send an e-mail notification to the Principal Investigator and Payment Requestor for the study for which the participant was last paid. This notification will alert the study team that the participant will not be able to be compensated more than a cumulative total of $400 across studies in a calendar year without providing the University their SSN. This notification will enable the study team to make participants aware that their SSN is required before any payment that will reach a cumulative total exceeding $400 during the current calendar year can be provided. This notification will provide the study team with the opportunity to alert the participant before they are required to provide their SSN. Early collection of SSNs by study teams before a participant reaches the $400 total payment threshold is strongly encouraged.
d. Consequence of failing to collect required payment information to meet Internal Revenue Service (IRS) requirements:
Direct Mail to Participants from HSIP Distribution Method: If a request for payment has been submitted by the study team to HSIP, but HSIP’s weekly audit indicates that the participant’s total payment in the calendar year would exceed $400 and the participant has not already provided their SSN, the HSIP office will notify the study team to collect the SSN. If the participant fails to provide their SSN to receive payment, the participant can decline to give their SSN and not be paid or; (2) decline to give the SSN and be paid only up to the $400 threshold in the calendar year.
Distribution to Participants from Study Teams Distribution Method: If a study team fails to collect participant name and address prior to disbursing funds to a participant or if they fail to collect name, address, and SSN prior to disbursing funds to a participant that has reached the $400 threshold in a calendar year (across their own or multiple studies), the study Principal Investigator and Payment Requestor may be marked as non-compliant with University participant payment policies in the HSIP system. In cases of non-compliance in the HSIP system, direct distribution of payments to participants by study teams may no longer be permitted for the study in which the non-compliance occurred; the ‘Direct Mail to Participants from HSIP Distribution Method’ will be used instead. These participants fall into a ‘high risk’ category in that they pose the greatest risk to U-M maintaining compliance with IRS tax reporting requirements.
As stewards of the university and federal funds, the study teams are obligated to use "best efforts" to avoid putting the university and participants at unnecessary risk for tax penalties.
e. Assurance of Compliance: It is strongly recommended, especially when study teams are disbursing multiple payments directly to participants and they have received a notification from HSIP that a study participant is close to the $400 limit, that study teams continuously monitor the total payment they are disbursing to each participant in a given calendar year to prevent non-compliance. This will also enable study teams to alert participants of the SSN collection requirements so that participants can make decisions about participating in future research where payment will not be provided unless they provide their SSN.
f. Non-Compliance Reporting: If a study team fails to comply with the procedures and process outlined in this document, the HSIP Office may inform the Human Research Protection Program Director.
g. Reporting to the IRB: Submit an ORIO report to the IRB if a consented research participant withdraws from study participation because they will not provide their SSN in order to receive payment.
V. STUDY TEAM RESPONSIBILITIES
At the time of participant payment, study teams must promptly provide the HSIP Office with participant names and addresses; limited exceptions are only permitted after assessment by the HSIP Office in collaboration with the Human Research Protection Program Director for undue hardship. Requests for exceptions to this policy should be submitted in advance of payment distribution to the HSIP Office. Decisions regarding exceptions for sensitive studies will be made in collaboration between the HSIP Office and the Human Research Protection Program, ensuring compliance with federal requirements in both domains.
Internal and confidential tracking within the University of the identity of participants being paid is a necessary component of maintaining compliance and oversight. Principal Investigators play a crucial role in ensuring the success of this policy change and procedure through their compliance.
When the University does not issue a 1099 to participants paid $600 or more in a calendar year, IRS penalties could be applied to the University. Further, when a study team fails to collect a SSN when required by IRS requirements and the research is federally funded, the study is in breach of terms requiring adherence to applicable laws and requirements (2 CFR Part 200.300 & 2 CFR 200.303). The study team has a responsibility as stewards of University and federal funds to minimize the possibility that the University is subjected to any IRS penalties and adhere to contractual terms of federal grants.
Participants receiving payment exceeding IRS reporting thresholds of $600 without providing their SSN to the University are not adhering to tax requirements. The study team has a responsibility to uphold the ethical principles of human participant research by minimizing the possibility that research participants are subjected to IRS inquiries for failing to adhere to tax requirements. If study teams overlook the collection of essential information from study participants, they are putting participants at risk for personally not adhering to tax requirements.
VI. APPENDIX: Tables showing the difference between current HSIP structure based on total payment amount of an individual study over the duration of the entire study and new policy that requires that study teams collect SSNs based on the total payment amount to an individual participant across all studies for which they are compensated in a calendar year