10.2 Fraud Investigation, Payment Recovery, and Sanctions

Lead Agencies must have the necessary controls to identify fraud and other program violations to ensure program integrity. Program violations can include both intentional and unintentional client and/or provider violations, as defined by the Lead Agency. These violations and errors, identified through the error-rate review process and other review processes, may result in payment or nonpayment (administrative) errors and may or may not be the result of fraud, based on the Lead Agency definition. 10.2.1 Strategies used to identify and prevent program violations Check the activities the Lead Agency employs to ensure program integrity, and for each checked activity, identify what type of program violations the activity addresses, describe the activity and the results of these activities based on the most recent analysis. a. [x] Share/match data from other programs (e.g., TANF program, Child and Adult Care Food Program, Food and Nutrition Service (FNS), Medicaid) or other databases (e.g., State Directory of New Hires, Social Security Administration, Public Assistance Reporting Information System (PARIS)). i. [x] Intentional program violations. Describe the activities, the results of these activities, and how they inform better practice: The Lead Agency uses several different data match programs. The Lead Agency matches with the Social Security Administration as well as income received through Social Security Assistance to verify citizenship. The federal hub verification was built into the eligibility system to verify citizenship and identity. The Lead Agency also uses the Work Number to verify employment and income. The Lead Agency’s audit and recovery management team uses several different data match programs to determine if fraud has been committed by comparing this information to was reported to the Lead Agency. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: The Lead Agency uses several different data match programs. The Lead Agency matches with the Social Security Administration as well as income received through Social Security Assistance to verify citizenship. The federal hub verification was built into the eligibility system to verify citizenship and identity. The Lead Agency’s audit and recovery management team uses several different data match programs to determine if fraud has been committed by comparing this information to was reported to the Lead Agency. iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice:: The Lead Agency uses several different data match programs. The Lead Agency matches with the Social Security Administration as well as income received through Social Security Assistance to verify citizenship. The federal hub verification was built into the eligibility system to verify citizenship and identity. These databases will also reveal agency/administrative errors. b. [x] Run system reports that flag errors (include types). i. [x] Intentional program violations. Describe the activities, the results of these activities, and how they inform better practice: The Lead Agency uses the share/match system database to run system reports for Quality Control case reviews that are done in reporting and non-reporting years to flag errors. Provider errors are addressed by notifying providers with a written communication and recouping monies if necessary. Additionally, there are several databases used to verify client data, e.g., the Work Number which verifies employment and vital statistics which verifies birth records/relationships. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: The Lead Agency uses the share/match system database to run system reports for Quality Control case reviews that are done in reporting and non-reporting years to flag errors. Internal errors are addressed by identifying patterns and facilitating necessary training. Provider errors are addressed by notifying providers with a written communication and recouping monies if necessary. Client program violations are addressed by reviewing them with the client and implementing corrective action. iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice: The Lead Agency uses the share/match system database to run system reports for Quality Control case reviews that are done in reporting and non-reporting years to flag errors. Internal errors are addressed by identifying patterns and facilitating necessary training. c. [x] Review enrollment documents and attendance or billing records. i. [x] Intentional program violations. Describe the activities, the results of these activities, and how they inform better practice: Childcare monitors conduct on site and virtual visits to review attendance and billing that has been submitted into the automated system by comparing them to physical attendance records during the visit. If a discrepancy is discovered, the childcare provider must resubmit attendance in the automated system, at which time a system recoupment is generated. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: Childcare monitors conduct on site and virtual visits to review attendance and billing that has been submitted into the automated system by comparing them to physical attendance records during the visit. If a discrepancy is discovered, the childcare provider must resubmit attendance in the automated system, at which time a system recoupment is generated. iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice: Childcare monitors conduct on site and virtual visits to review attendance and billing that has been submitted into the automated system by comparing them to physical attendance records during the visit. If a discrepancy is discovered, the lead agency will reimburse the provider the difference in the amount. d. [x] Conduct supervisory staff reviews or quality assurance reviews. i. [x] Intentional program violations. Describe the activities, the results of these activities, and how they inform better practice: Supervisors of eligibility staff are required to perform Supervisor Reviews of cases prior to eligibility determination. In doing so potential errors are detected before a family is determined eligible. The Lead Agency also has a Quality Control team that reviews childcare cases in reporting and non-reporting years. The QC team meets with eligibility staff and the childcare policy administrator monthly to review errors and/or findings. These findings are discussed to determine is policy was accurately applied. Patterns of error are then discussed with eligibility staff ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: Supervisors of eligibility staff are required to perform Supervisor Reviews of cases prior to eligibility determination. In doing so potential errors are detected before a family is determined eligible. The Lead Agency also has a Quality Control team that reviews childcare cases in reporting and non-reporting years. The QC team meets with eligibility staff and the childcare policy administrator monthly to review errors and/or findings. These findings are discussed to determine is policy was accurately applied. Patterns of error are then discussed with eligibility staff. iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice: Supervisors of eligibility staff are required to perform Supervisor Reviews of cases prior to eligibility determination. In doing so potential errors are detected before a family is determined eligible. The Lead Agency also has a Quality Control team that reviews childcare cases in reporting and non-reporting years. The QC team meets with eligibility staff and the childcare policy administrator monthly to review errors and/or findings. These findings are discussed to determine is policy was accurately applied. Patterns of error are then discussed with eligibility staff. e. [x] Audit provider records. i. [x] Intentional program violations. Describe the activities, the results of these activities, and how they inform better practice: Childcare monitors perform announced and unannounced visits to subsidy providers. During the review, the monitor will compare the provider's summary attendance, daily attendance, sign-in and sign-out sheet. If discrepancies are identified, the provider must revise and resubmit attendance records and a system generated recoupment will occur. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: Childcare monitors perform announced and unannounced visits to subsidy providers. During the review, the monitor will compare the provider's summary attendance, daily attendance, sign-in and sign-out sheet. If discrepancies are identified, the provider must revise and resubmit attendance records and a system generated recoupment will occur. iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice: Childcare monitors perform announced and unannounced visits to subsidy providers. During the review, the monitor will compare the provider's summary attendance, daily attendance, sign-in and sign-out sheet. If discrepancies are identified, the provider must be reimbursed for the difference in the amount. f. [x] Train staff on policy and/or audits. i. [x] Intentional program violations. Describe the activities, the results of these activities, and how they inform better practice: New staff and experienced staff (as needed) participate in the Lead Agency's training academy. During the training, staff are provided with a thorough review of childcare policy and procedure. This is done through instructor led training which also includes members of the childcare policy team. Additionally, staff are trained to review the eligibility budget prior to confirming the benefits to ensure the correct benefits are issued. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: New staff and experienced staff (as needed) participate in the Lead Agency's training academy. During the training, staff are provided with a thorough review of childcare policy and procedure. This is done through instructor led training which also includes members of the childcare policy team. Additionally, staff are trained to review the eligibility budget prior to confirming the benefits to ensure the correct. iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice: New staff and experienced staff (as needed) anticipate in the Lead Agency's training academy. During the training, staff are provided with a thorough review of childcare policy and procedure. This is done through instructor led training which also includes members of the childcare policy team. Additionally, the quality control team reviews case in reporting and non-reporting years. Errors are shared with individual eligibility teams through a TEAMS file. Eligibility teams will review these errors and mitigate when applicable. Based on identified errors policy briefs are disseminated, podcasts are used to address the errors and roadshows are conducted with eligibility teams where the errors are again addressed. g. [ ] Other. Describe the activity(ies): i. [ ] Intentional program violations. Describe the activities, the results of these activities, and how they inform better practice: ii. [ ] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: iii. [ ] Agency errors. Describe the activities, the results of these activities, and how they inform better practice: 10.2.2 Identification and recovery of misspent funds Lead Agencies must identify and recover misspent funds that are a result of fraud, and they have the option to recover any misspent funds that are a result of unintentional program violations or agency errors. a. Identify which agency is responsible for pursuing fraud and overpayments (e.g., State Office of the Inspector General, State Attorney): The Lead Agency is responsible for pursuing fraud and overpayments. b. Check and describe all activities, including the results of such activity, that the Lead Agency uses to investigate and recover improper payments due to fraud. Consider in your response potential fraud committed by providers, clients, staff, vendors, and contractors. Include in the description how each activity assists in the investigation and recovery of improper payment due to fraud or intentional program violations. Activities can include, but are not limited to, the following: i. [x] Require recovery after a minimum dollar amount of an improper payment and identify the minimum dollar amount. Describe the activities and the results of these activities based on the most recent analysis: When an improper payment is discovered, the provider is immediately notified inwriting of the discovery, the amount of the improper payment and the recoupment process. Recovery is required after a minimum overpayment of $1.00. ii. [x] Coordinate with and refer to the other State/Territory agencies (e.g., State/Territory collection agency, law enforcement agency). Describe the activities and the results of these activities based on the most recent analysis: The lead agency coordinates with other state agencies maintaining federal grants to discuss provider fraud when it is identified to ensure that we are all aware of the fraud as it may be co-occurring in our respective programs. The lead agency has the power to enforce recoupment of misspent funds and does coordinate with the Department of Justice should the discovery of fraud lead to felony prosecution. iii. [x] Recover through repayment plans. Describe the activities and the results of these activities based on the most recent analysis: A recoupment process is built into the Lead Agency's billing system. When a provider is required to repay based on billing discrepancies identified, the system will automatically establish a recoupment amount and recoupment is automated in increments monthly through the provider's account. iv. [x] Reduce payments in subsequent months. Describe the activities and the results of these activities based on the most recent analysis: A recoupment process is built into the Lead Agency's billing system. When a provider is required to repay based on billing discrepancies identified, the system will automatically establish a recoupment amount and recoupment is automated in increments monthly through the provider's account. v. [ ] Recover through State/Territory tax intercepts. Describe the activities and the results of these activities based on the most recent analysis: vi. [ ] Recover through other means. Describe the activities and the results of these activities based on the most recent analysis: vii. [x] Establish a unit to investigate and collect improper payments and describe the composition of the unit. Describe the activities and the results of these activities based on the most recent analysis: Audit and Recovery Management Services (ARMS) identifies, investigates, and refers for criminal prosecution or civil litigation acts of fraud or error that caused an overpayment of benefits in welfare programs administered by Delaware Health and Social Services. ARMS is responsible for the accounting and collection of all debts owed to the state because of an overpayment of benefits in a public welfare program administered by DHSS. viii. [ ] Other. Describe the activities and the results of these activities: c. Does the Lead Agency investigate and recover improper payments due to unintentional program violations? [ ] No. [x] Yes. If yes, check and describe below any activities that the Lead Agency will use to investigate and recover improper payments due to unintentional program violations. Include in the description how each activity assists in the investigation and recovery of improper payments due to unintentional program violations. Include a description of the results of such activity. i. [x] Require recovery after a minimum dollar amount of an improper payment and identify the minimum dollar amount. Describe the activities and the results of these activities based on the most recent analysis: When an improper payment is discovered, the provider is immediately notified inwriting of the discovery, the amount of the improper payment and the recoupment process. Recovery is required after a minimum overpayment of $1.00. ii. [x] Coordinate with and refer to the other State/Territory agencies (e.g., State/Territory collection agency, law enforcement agency). Describe the activities and the results of these activities based on the most recent analysis: The lead agency coordinates with other state agencies maintaining federal grants to discuss provider fraud when it is identified to ensure that we are all aware of the fraud as it may be co-occurring in our respective programs. The lead agency has the power to enforce recoupment of misspent funds and does coordinate with the Department of Justice should the discovery of fraud lead to felony prosecution. iii. [x] Recover through repayment plans. Describe the activities and the results of these activities based on the most recent analysis: A recoupment process is built into the Lead Agency's billing system. When a provider is required to repay based on billing discrepancies identified, the system will automatically establish a recoupment amount and recoupment is automated in increments monthly through the provider's account iv. [x] Reduce payments in subsequent months. Describe the activities and the results of these activities based on the most recent analysis: A recoupment process is built into the Lead Agency's billing system. When a provider is required to repay based on billing discrepancies identified, the system will automatically establish a recoupment amount and recoupment is automated in increments monthly through the provider's account v. [ ] Recover through State/Territory tax intercepts. Describe the activities and the results of these activities based on the most recent analysis: vi. [ ] Recover through other means. Describe the activities and the results of these activities based on the most recent analysis: vii. [x] Establish a unit to investigate and collect improper payments and describe the composition of the unit. Describe the activities and the results of these activities based on the most recent analysis: Audit and Recovery Management Services (ARMS) identifies, investigates, and refers for criminal prosecution or civil litigation acts of fraud or error that caused an overpayment of benefits in welfare programs administered by Delaware Health and Social Services. ARMS is responsible for the accounting and collection of all debts owed to the state because of an overpayment of benefits in a public welfare program administered by DHSS. viii. [ ] Other. Describe the activities and the results of these activities: d. Does the Lead Agency investigate and recover improper payments due to agency errors? [ ] No. [x] Yes. If yes, check and describe all activities that the Lead Agency will use to investigate and recover improper payments due to agency errors. Include in the description how each activity assists in the investigation and recovery of improper payments due to administrative errors. Include a description of the results of such activity. i. [x] Require recovery after a minimum dollar amount of an improper payment and identify the minimum dollar amount. Describe the activities and the results of these activities based on the most recent analysis: When an improper payment is discovered, the provider is immediately notified inwriting of the discovery, the amount of the improper payment and the recoupment process. Recovery is required after a minimum overpayment of $1.00. ii. [x] Coordinate with and refer to the other State/Territory agencies (e.g., State/Territory collection agency, law enforcement agency). Describe the activities and the results of these activities based on the most recent analysis: The lead agency coordinates with other state agencies maintaining federal grants to discuss provider fraud when it is identified to ensure that we are all aware of the fraud as it may be co-occurring in our respective programs. The lead agency has the power to enforce recoupment of misspent funds and does coordinate with the Department of Justice should the discovery of fraud lead to felony prosecution. iii. [x] Recover through repayment plans. Describe the activities and the results of these activities based on the most recent analysis: A recoupment process is built into the Lead Agency's billing system. When a provider is required to repay based on billing discrepancies identified, the system will automatically establish a recoupment amount and recoupment is automated in increments monthly through the provider's account. iv. [x] Reduce payments in subsequent months. Describe the activities and the results of these activities based on the most recent analysis: A recoupment process is built into the Lead Agency's billing system. When a provider is required to repay based on billing discrepancies identified, the system will automatically establish a recoupment amount and recoupment is automated in increments monthly through the provider's account. v. [ ] Recover through State/Territory tax intercepts. Describe the activities and the results of these activities based on the most recent analysis: vi. [ ]Recover through other means. Describe the activities and the results of these activities based on the most recent analysis: vii. [x] Establish a unit to investigate and collect improper payments and describe the composition of the unit. Describe the activities and the results of these activities based on the most recent analysis: Audit and Recovery Management Services (ARMS) identifies, investigates, and refers for criminal prosecution or civil litigation acts of fraud or error that caused an overpayment of benefits in welfare programs administered by Delaware Health and Social Services. ARMS is responsible for the accounting and collection of all debts owed to the state because of an overpayment of benefits in a public welfare program administered by DHSS. viii. [ ] Other. Describe the activities and the results of these activities: e. What type of sanction will the Lead Agency place on clients and providers to help reduce improper payments due to intentional program violations or fraud? Check and describe all that apply: i. [x] Disqualify the client. Describe this process, including a description of the appeal process for clients who are disqualified. Describe the activities and the results of these activities based on the most recent analysis: Clients who are found to have committed an intentional program violation or fraud are disqualified. The recoupment process is conducted through ARMS. The Lead Agency provides an opportunity for a fair hearing to any individual who is dissatisfied with a decision of the Lead Agency (i.e., to deny, suspend, delay, reduce, terminate, or sanction Division-issued benefit, etc.). The purpose of a fair hearing is to give all applicants and recipients an opportunity for an impartial, objective review of actions taken in programs administered by the Division. Every person is informed in writing at the time of application and at the time of any action affecting their benefits of their right to a fair hearing and the method by which they may request a hearing. They may appear for the hearing alone or may be represented by counsel or by another person at the hearing. ii. [x]Disqualify the provider. Describe this process, including a description of the appeal process for providers who are disqualified. Describe the activities and the results of these activities based on the most recent analysis: Providers who are found to have committed an intentional program violation or fraud will be notified of the discovery in writing. The provider's license will be terminated, and all misspent funds will be recouped by the lead agency. Providers who are disqualified may request an Administrative Review with the Senior Administrator of the Lead Agency. If the provider's license is terminated the provider may request a Hearing, which is conducted by a Hearing Officer with the Office of Child Care Licensing. iii. [x] Prosecute criminally. Describe the activities and the results of these activities based on the most recent analysis: The lead agency will prosecute any childcare subsidy providers who commits intentional fraud. To qualify for a felony prosecution, the theft must amount to at least$1,500.00 (rules of Delaware Code) and the burden of proof must meet the level accepted by the Department of Justice (beyond a reasonable doubt). iv. [ ] Other. Describe the activities and the results of these activities based on the most recent analysis: Appendix 1: Lead Agency Implementation Plan The Appendix will be available for Lead Agencies to use in CARS after the Plan approval letter is issued. For each non-compliance, Lead Agencies must describe the following: • Action Steps: List the action steps needed to correct the finding (e.g., update policy manual, legislative approval, IT system changes, etc.). For each action step list the: o Responsible Entity: Indicate the entity (e.g., agency, team, etc.) responsible for completing the action step. o Expected Completion Date: List the expected completion date for the action step. • Overall Target Date for Compliance: List date Lead Agency anticipates completing implementation, achieving full compliance with all aspects of the findings. (Note: Compliance will not be determined until the FFY 2025-2027 CCDF Plan is amended and approved). Appendix 1: Form [Plan question with non-compliance and associated provision will pre-populate based on preliminary notice of non-compliance] A. Action Steps for Implementation B. Responsible Entity(ies) C. Expected Completion Date Step 1: Step 2 (as necessary): [Additional steps added as necessary] Overall Target Date for Compliance: