28.3 Unrecoverable Overpayments

Do not initiate recovery for a BadgerCare Plus overpayment if it resulted from a non-member error, including the following situations:

The member reported the change timely, but the case could not be closed or the benefit reduced due to the 10-day notice requirement.
Agency error (keying error, math error, failure to act on a reported change, etc).
Normal prospective budgeting projections based on best available information.
The member’s tax filing status is different from what he or she reported as his or her expected tax filing status for that year.

Example 1: Susan and her daughter Kathy are open for BadgerCare Plus. Susan reported a change in income on April 1. The worker did not process the change until April 28, so it was not effective until June 1. There is no overpayment for May since the change was reported timely, but not acted on by the worker until after adverse action .

28.3.1 Gap Filling Eligibility Considerations

For any potential overpayments for BadgerCare Plus on or after February 1, 2014, a member should not be subject to an overpayment if he or she could have been eligible under gap filling rules for the overpayment period even if he or she failed to report a change in monthly income or other household circumstances. A denial letter from the FFMFederally-Facilitated Marketplace (also known as the Marketplace or the Exchange). Applications for BadgerCare Plus or Medicaid may be filed with the Federally-Facilitated Marketplace, run by the U.S. Department of Health and Human Services. The Marketplace will assess their applicants as potentially eligible for the State’s Medicaid or CHIP programs, and, if found potentially eligible, will transfer individual accounts to the income maintenance agency for a full determination. Individuals who apply at income maintenance agencies or ACCESS and are found ineligible for Medicaid or CHIP will be sent to the Marketplace., gap filling indicator, or specific gap filling request by the member is not required to determine eligibility during the overpayment period under gap filling rules.

For any past overpayments in which MAGIModified Adjusted Gross Income. MAGI rules are used to determine BadgerCare Plus eligibility for new applicants beginning in 2014 and for existing members as of March 31, 2014, or their next regularly scheduled renewal, whichever is later. MAGI rules are based on tax relationships and family relationships, and they consider taxable income and whether children and tax dependents are required to file. rules for BadgerCare Plus were in effect and the member believes he or she would have been eligible for BadgerCare Plus based on annual income, the IMincome maintenance agency must review the past overpayment at the member’s request. To determine annual income, refer to Section 16.9 Gap Filling.

When researching a potential overpayment due to excess monthly income for the current calendar year, an IM agency must determine that the person surpassed 100 percent of the FPLFederal Poverty Level based on his or her annual income limit before an overpayment can be established. If the person's annual income has not yet surpassed 100 percent of the FPL, do not establish an overpayment until there is evidence that the person has surpassed 100 percent of the FPL. Establishing the overpayment may require waiting until the end of the calendar year for actual income to become available to determine if the person surpassed 100 percent of the FPL.

Example 2: Richard became eligible for BadgerCare Plus as a childless adult in March 2016 and had no countable income. At his renewal in February 2017, Richard reports that he has been working since April 2016. Verification shows that Richard’s salary of $2,500 per month came to a countable income total of $22,500. Although Richard exceeded the reporting limit of $990 in April 2016, the worker must look at what would have happened had he reported the change timely when determining whether an overpayment occurred.

The worker finds that Richard was required to report his change in income no later than May 10, 2016. Since verification of his actual income for 2016 shows that he was over the annual income limit for gap filling, there is an overpayment for June 1–December 31, 2016.

The worker then evaluates the overpayment for January and February 2017. So far in 2017, Richard has only received $5,000 in countable income. Because the IM agency does not have any information to indicate that Richard’s job will not continue for the rest of 2017, he would not be found eligible under gap filling rules. However, for benefit recovery purposes, he has not yet exceeded the 100 percent of the FPL annual income limit of $12,060 for 2017, so the IM agency cannot say definitively that he would not have been eligible under gap filling rules. The worker may not establish an overpayment for his eligibility in 2017 until Richard’s income has been found to be over the annual limit for gap filling coverage. The worker must manually track the case to review the case in January 2018.

In January 2018, the worker reviews Richard’s case for a potential overpayment from January 1–February 28, 2017, and determines his annual income. His earned wages were $6,700 for the first quarter of 2017, $5,100 for second quarter of 2017, and $4,250 for the third quarter of 2017. His fourth quarter wages have not been updated yet. Based on the information available, Richard has surpassed the annual income limit for 2017. His total wages through the third quarter of 2017 total $16,050. There is an overpayment for the period of January 1–February 28, 2017.

Example 3: Kimmy was eligible for BadgerCare Plus as a childless adult beginning in October 2016. In August 2017, the worker is processing a discrepancy created in July 2017 showing that Kimmy has unreported wages from the first quarter of 2017. The worker requests verification from Kimmy, which shows that she works 32 hours per week and earns $15 per hour for a total of $1,920 per month. Had Kimmy reported her income timely by February 10, 2017, she would have been over the monthly income limit for BadgerCare Plus. SWICA shows that Kimmy has already earned $13,700 for 2017.

Since the worker has evidence that Kimmy has surpassed the annual income limit for 2017 ($12,060), the worker can proceed with establishing an overpayment for March 1–June 30, 2017.

While an agency is waiting to verify if a person has surpassed the annual income limit for a potential overpayment, that person could experience changes in circumstances, including but not limited to, changes in income or assistance group size. If more current information is available at the time of determining an overpayment, these changes must be taken into consideration in the determination.

Example 4: Effective February 1, 2017, Delia was eligible for BadgerCare Plus as a childless adult with an assistance group size of one. In August 2017, she reports that her 8-year-old daughter, Zoe, has moved into household, and she plans to claim Zoe as a tax dependent. Beginning September 2017, Delia is determined eligible as parent or caretaker adult with an assistance group size of two.

In February 2018, a worker is reviewing a SWICAState Wage Information Collection Agency discrepancy showing that Delia began a job in March 2017, which she did not report. The worker verifies that Delia’s income is over the monthly income limit for April–November 2017 and sees that she had an annual income total of $14,700 for 2017. For part of that period, Delia was in a group size of one and surpassed the 2017 annual income limit ($12,060) for a group size of one. However, starting in September 2017, Delia’s group size increased when Zoe was added to the case. Taking into consideration the change in group size during the overpayment period and Delia’s annual income ($14,700) compared to the 2017 annual FPL for a group size of two ($16,240), there is no overpayment since Delia will be ending the tax filing year with a group size of two and will be below the annual income limit for a group size of two.

This page last updated in Release Number: 18-01

Release Date: 04/13/2018

Effective Date: 02/16/2018