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State of Wisconsin Release 09-02 June 26, 2009 |
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State of Wisconsin Release 09-02 June 26, 2009 |
7.3.2.2 Collecting Client and Nonclient Error Claims Against Participating Households
7.3.2.3 Collecting Claims for Client & Non Client Errors Against Non-Participating Household
7.3.2.7 Writing-Off Claims Against Non-Participating Households
7.3.2.9 Timely Negative Notice
Consider the FS group’s reporting requirements when calculating the overissuance. Do not use income or expenses, or changes in income and expenses that were not reported and were not required to be reported.
Client Error
Establish a claim for a client error that occurred when the FS group unintentionally:
Failed to provide correct or complete information.
Failed to report a change that was required to be reported.
Received FS for which it was not entitled pending a fair hearing decision.
When overissuance is because the group did not timely report a change, begin with the month the overissuance was discovered and extend backward:
Six years, or
To the month the change would have been effective had the group timely reported it, whichever is most recent.
The month the change would have been effective cannot be more than 2 months after the change in circumstance actually occurred.
Do not apply the 20% earned income deduction to earned income which was required to be reported, and was not reported timely. If expenses were reported correctly at the time of the overissuance, use the same expenses when calculating the overissuance. If not, then do not use the expenses in the calculation. In claim calculations, disregard income that was not previously reported and was not required to be reported.
Non-client Error
Establish a claim for a nonclient error that occurred when the agency:
Did not take prompt action on a change the FS group reported, or
Incorrectly computed the group's income or a deduction, or
Continued to give the group FS after its eligibility ended, or
Did not reduce the group's FS to correspond with a W-2 Wisconsin Works, SSI Supplemental Security Income, or GR General Relief A program administered by counties and paid for jointly by counties and the state. This program provides monthly cash grants and medical services. grant increase.
The overpayment period for nonclient errors begins with the month the error is discovered and extends back 12 months or when the error was effective, whichever is most recent.
When determining if an overissuance occurred due to an unreported increase in total gross monthly income, compare the total actual unconverted income amount to the income reporting limit for the household size to determine if the income should have been reported. Enter the converted income amount to determine ongoing benefit eligibility. Use the income and expenses reported or required to be reported for each month of the adjustment period. In claim calculations, disregard income that was not previously reported and was not required to be reported.
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Example 1: At Jeff’s review on June 5, his worker Marcia miscalculated Jeff’s income and budgeted $400/month instead of the $800/month that Jeff reported. When Jeff submits his SMRF on December 5, Marcia discovers her error and begins to calculate overissuance for benefits issued from July to December. While reviewing Jeff’s income, Marcia discovers that Jeff started a second job on August 1, from which he earns $600/month.
To calculate the overissuance for the benefits issued from July through December, Marcia budgets the correct income amount of $800 from the job Jeff was required to report.
Marcia does not use the income from the second job, because the income did not cause Jeff’s food unit to exceed their reduced reporting income limit. Jeff was not required to report the change until his next SMRF, which he did. |
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Example 2: Mike submitted a complete SMRF on February 4. On May 12, Mike’s worker, John discovers that he budgeted the full heating allowance even though Mike’s heat is included in his rent. While determining if Mike has an overpayment, John learns that Mike began a second job, from which he earns $120/month. The additional income does not push Mike’s income over 130% of the FPL, so he is not required to report the change until his next review, due in August.
John calculates the overissuance using the correct utility allowance and compares that amount of benefits issued to the amount that should have been issued for the months of February through May.
John does not use the income from Mike’s second job because it was not required to be reported. |
Establish collection of overissuance claims against participating households unless:
The claim is collected through an offset, or
Claims are protected by the Federal Bankruptcy Code
Do not charge any interest on the claim.
If the client wishes to pay the whole claim at once, s/he may do so.
A participating household a food unit or AG that is still open and receiving FS benefitsFS FoodShare benefits food unit or AG that is still open and receiving FS benefits is defined as a food unit or AG that is still open and receiving FS benefits.
Establish overissuance claims for non-participating food units only if the amount of the claim is $125.00 or more.
A non-participating household is defined as a food unit or AG that is closed and not receiving FS benefits.
Establish a claim due to an Intentional Program Violation (IPV Intentional Program Violation) only when one of these conditions exists. The food unit member:
Signs a waiver of the disqualification hearing, or
Signs a disqualification consent agreement after being referred for prosecution, or
Is convicted of a FS felony or found guilty of IPV in an Administrative Disqualification Hearing or judicial proceeding.
Conduct which may lead to an IPV determination for an individual include:
Making false or misleading statements or misrepresenting, concealing or withholding facts to become eligible or to remain eligible for benefits, or
Committing any act that constitutes a violation of FoodShare regulations or state statutes relating to the use, presentation, transfer, acquisition, receipt or possession of FS, i.e., trafficking FS.
If you have a pending IPV hearing, establish the claim as a nonclient error. If the case has been referred to the DA for prosecution, discuss the claim establishment with the DA or your legal counsel.
If the DA or your legal counsel advises that processing a claim as a client error may create bias against an IPV judgment, do not process the claim until the IPV determination is made.
For eligibility-related IPV claims, do not apply the 20% earned income deduction to earned income which was required to be reported, and was not reported timely. If expenses were reported correctly at the time of the overissuance, use the same expenses when calculating the overissuance. If not, then do not use the expenses in the calculation.
In claim calculations, disregard income that was not previously reported and was not required to be reported.
For trafficking-related claims, establish the claim as determined by:
the individual’s admission, or
the amount ordered through adjudication, or
the documentation that forms the basis for the trafficking charge.
Offset the IPV claim against any restoration amount owed to the group. Start collection action for the remaining balance.
You must collect an IPV claim previously handled as a client error claim. Start the IPV procedure for collection whenever a client error is later determined to be an IPV.
Enter the IPV information in CARES Client Assistance for Reemployment and Economic Support to recalculate the claim amount as an IPV type, and
Send the FS group a new Notice of FS Overissuance showing IPV as the reason, and
Send a new Notice of Repayment Agreement.
Do not charge any interest on the claim.
IPV information is entered in CARES as soon as possible after the date of decision either by a worker or through the Data Exchange (DX) process for IPVs that have occurred in other states. Workers enter the type of offense on AIIP as indicated in the legal IPV documents. When the sanction number and type of offense code are entered, CARES will automatically calculate the sanction duration period.
If the document does not contain the offense type, obtain more information from the party who issued the IPV. The Sanction Duration field should not be updated by workers unless it is necessary to override a sanction duration based on legal documents that indicate a different sanction duration period.
Sanction duration is the number of months a recipient is disqualified from receiving FS. Code 999 is permanent disqualification. No sanction end date will appear if the sanction duration is 999.
An overissuance due to any type of error will be recovered from a FS group participating in the program by reducing their allotment.
The type of error determines the amount that will be recovered each month.
Client/Nonclient error. CARES will reduce the allotment by the greater of 10% of the group's monthly allotment or $10 each month. The $10 minimum benefit level for 1 or 2 person groups applies before CARES reduces the allotment.
IPV. CARES will reduce the allotment by the greater of 20% of the group' monthly entitlement or $20 each month. The entitlement is the amount of benefits the group would have received if not for the disqualification of a FS group member. The $10 minimum benefit level for 1 or 2 person groups applies before CARES reduces the allotment.
CARES will not allow you to reduce the minimum deduction to less than $10 for Client/Nonclient and less than $20 for an IPV.
Claims against non-participating households may be written off if reasonable collection efforts have been made and the debt is determined to be uncollectable. Recommendation to write-off can be made if proper documentation is submitted to demonstrate that the claim meets any of the following criteria:
It is found to be invalid in a fair hearing, administrative or judicial decision.
It is against a household in which all adult a person who is 18 years old or older members are deceased and the State does not plan to pursue collection against the estate.
It has been discharged through bankruptcy or a bankruptcy stay is in effect.
It cannot be substantiated from case records.
The state agency has determined, after exhausting collection efforts, that it is not cost-effective to collect the claim. If the request to write off the claim is made on this basis the following criteria should be used:
The claim has an outstanding balance of $24 or less and has been past due for 90 days or more.
The claim is from $25 to $499 and:
Three past due notices have been sent,
It was referred for tax intercept, if the tax intercept was successful the account
should remain open for 3 years or until paid in full, and
It has been past due for 3 years.
The claim is from $500 to $4999 and:
Three past due notices have been sent,
It was referred for tax intercept (if the tax intercept was successful the account should remain open for 5 years or until paid in full),
It has been considered for referral to a collection agency or credit bureau, and
It has been past due for 5 years.
The claim is over $5000 and:
Three past due notices have been sent,
It was referred for tax intercept (if the tax intercept was successful the account should remain open for 10 years or until paid in full),
It has been considered for referral to a collection agency or credit bureau, and
It has been past due for 10 years.
Documentation of the following information is required:
The age of the claims,
Actions taken to collect,
Documents relevant to the specific claim, e.g., death certificates, bankruptcy discharge orders, administrative or judicial decisions.
Recommendations for the writing-off of claims must be submitted to the Public Assistance Collection Unit P.O. Box 8938, Madison, WI 53708-8938.
If a group has overpaid a claim, refund the amount overpaid as soon as you discover it. Request reimbursement from DES. Follow the instructions in the Accounting Reports Manual, IV.
FS benefits issued solely because the 10-day negative notice requirement cannot be met, are not an overissuance. Do not establish a claim or recover this type of issuance.
The State of Wisconsin Public Assistance Collections Unit uses tax intercept from both state and federal tax refunds to recover overpayments from anyone who has become delinquent in repayment of an overissuance.
To use tax intercept, the person must have received three or more dunning notices and the debt must be:
Valid and legally enforceable.
State: All error types.
Federal: All error types.
State: At least $20.
Federal: At least $25.
State: At least 30 days from notification of overissuance.
Federal: Not more than 10 years past due from notification date except in fraud cases. There is no delinquency period for fraud.
Free from any current appeals.
Incurred by someone who has not filed bankruptcy, nor has their spouse A person recognized by Wisconsin law as another person's legal husband or wife. Wisconsin does not recognize common law marriage..
State tax intercept notices include a 30 day fair hearing right. The Division of Hearings and Appeals conducts the fair hearing. Federal intercept notices have a 60 day administrative review process. The Public Assistance Collections Unit conducts the administrative desk review. The client must provide evidence showing the claim is not past due, or is not legally enforceable. If the client can not provide that evidence, the case will be sent for intercept.
The case is not subject to the tax intercept while under review or appeal.
A client who makes a repayment agreement may not be subject to tax intercept as long as s/he is meeting the conditions of the agreement. If a client has received three dunning notices, s/he is subject to both tax intercept and monthly repayment.
The policies for monthly repayments are listed on the repayment agreements:
Overpayments less than $500 should be paid by at least $50 monthly installments
Overpayments $500 and above should be paid within a three-year period either by equal monthly installments, or by monthly installments of not less than $20.
This page last updated in Release Number: 07-02
Release Date: 07/10/07
Effective Date: 07/10/07