Supplemental Security Insurance (SSI)is available only to people with very low income and almost no assets. In deciding whether someone is eligible for SSI, and if eligible how much in monthly benefits the person receives, the SSI program looks at all sources of income. That includes anything of value a person regularly receives without paying, such as food, clothing and, as in your mother's case, rent. Although your mother is paying you $200 a month, because you told SSI that the room is "worth" $500 a month, they calculate that she is getting the difference -- $300 -- in the form of "free" rent. So, it sounds like they reduced her monthly benefits accordingly.
If you do not believe that your mother's room is really rentable for $500 on the open rental market, you can try to demonstrate that to SSI and ask them to change their decision about your mother's benefit amount. You'll have to do some homework. Do some research in the local newspaper, online, and anywhere else local room rentals are advertised, and make copies of advertisements for rooms that are similar to the one your mother has (same geographic area, same size, same facilities -- or lack of them, such as a separate bathroom). If you can gather proof that a room like your mother's would be rented for much less than $500, you can take that proof to SSI and ask them to reconsider their benefit decision.
When you gather your evidence about the real market value of the room, write a letter to SSI explaining the situation, attaching copies of your proof. Then set up an appointment to see a Social Security or other Social Services worker at the office that handles your mother's SSI claim, bringing your proof with you to the appointment. You can also send the letter and proof ahead of time, but make sure you set up a face-to-face meeting during which you can explain the situation.