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: Sites & CCR&R utilize statewide database screens to confirm elements of provider and client eligibility. In conducting these searches, staff can determine if a client or provider may have committed a program violation. Those that are determined to have committed an intentional program violation will be issued an overpayment to recoup any improper payments that have been made. Depending on the severity of the violation, and if they party had committed previous violations, a sanction may be issued. Information and/or training concerning the violation is shared with contracted staff to bring awareness to issues that should receive extra attention during eligibility and payment processing. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: Sites & CCR&R utilize statewide database screens to confirm elements of provider and client eligibility. In conducting these searches, staff can determine if a client or provider may have committed a program violation. Those that are determined to have committed an unintentional program violation will be issued an overpayment to recoup any improper payments that have been made. Information and/or training concerning the violation is shared with contracted staff to bring awareness to issues that should receive extra attention during eligibility and payment processing. iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice:: Eligibility staff review information on the Automated Wage Verification System (AWVS), maintained by the Illinois Departments of Labor, and Employment Security. Information on applicants’ employers and quarterly earnings are reviewed to determine if all employment has been reported and if wage amounts support reported income information. AWVS screens are also reviewed for home-based providers to determine if other employment could conflict with the hour of care being requested. b. [ ] Run system reports that flag errors (include types). 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: 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: Violations that are determined to have committed an intentional program violation will be issued an overpayment to recoup any improper payments that have been made. Depending on the severity of the violation, and if they party had committed pervious violations, a sanction may be issued. Information and/or training concerning the violation is shared with contracted staff to bring awareness to issues that should receive extra attention during eligibility and payment processing. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: Violations that are determined to have committed an unintentional program violation will be issued an overpayment to recoup any improper payments that have been made. Information and/or training concerning the violation is shared with contracted staff to bring awareness to issues that should receive extra attention during eligibility and payment processing. iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice: Errors that result in an overpayment may be issued to the provider who received the incorrect payment. Results are shared with contracted staff to bring awareness to issues that should receive extra attention during eligibility and payment processing. 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: All audit reviews conducted by the Lead Agency are reviewed and signed off by the Programmatic Monitoring Unit Manager. This process ensures that the report is accurate, and a corrective action plan is established if needed. CCR&Rs also conduct supervisory staff reviews to ensure processing is accurate, which will result in less fraudulent activity. Violations that are determined to have committed an intentional program violation will be issued an overpayment to recoup any improper payments that have been made. Depending on the severity of the violation, and if they party had committed pervious violations, a sanction may be issued. Information and/or training concerning the violation is shared with contracted staff to bring awareness to issues that should receive extra attention during eligibility and payment processing. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: All audit reviews conducted by the Lead Agency are reviewed and signed off by the Programmatic Monitoring Unit Manager. This process ensures that the report is accurate, and a corrective action plan is established if needed. CCR&Rs also conduct supervisory staff reviews to ensure processing is accurate, which will result in less fraudulent activity. Violations that are determined to have committed an unintentional program violation will be issued an overpayment to recoup any improper payments that have been made. Information and/or training concerning the violation is shared with contracted staff to bring awareness to issues that should receive extra attention during eligibility and payment processing. iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice: All audit reviews conducted by the Lead Agency are reviewed and signed off by the Programmatic Monitoring Unit Manager. This process ensures that the report is accurate, and a corrective action plan is established if needed. CCR&Rs also conduct supervisory staff reviews to ensure processing is accurate, which will result in less fraudulent activity. Errors that result in an overpayment may be issued to the provider who received the incorrect payment. Results are shared with contracted staff to bring awareness to issues that should receive extra attention during eligibility and payment processing. e. [ ] Audit provider records. 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: 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: Information provided to the Program Support Unit from the Programmatic Monitoring Unit on program violations are included in regularly scheduled trainings with processing staff, or through a special training, depending on the need and severity of the issue. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: Information provided to the Program Support Unit from the Programmatic Monitoring Unit on program violations are included in regularly scheduled trainings with processing staff, or through a special training, depending on the need and severity of the issue iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice: Information provided to the Program Support Unit from the Programmatic Monitoring Unit on program violations are included in regularly scheduled trainings with processing staff, or through a special training, depending on the need and severity of the issue. 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): IDEC’s Programmatic Monitoring Unit conducts reviews of clients and providers when fraud is suspected or reported. Cases requiring more in-depth investigation are referred to the Department of Heatlhcare and Family Services, who may refer fraudulent activity to the Office of the Inspector General, State Attorney or others for possible prosecution as warranted. IDEC Bureau of Collections manages and tracks all recoupment activity, including referring cases to the Illinois Office of the Comptroller for possible seizures and private collection agencies. 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: The minimum recovery amount is $1.00. This aids in ensuring that any improper payment must be repaid to the program, regardless of the amount, while emphasizing the importance of adhering to program policies and procedure. This recovery of funds at a minimum of $1 results in lowering the percentage of overpayments and program violations. When an overpayment is identified by a CCR&R, a Site Administered Program or IDEC's Program Integrity and Quality Assurance (PIQA) staff, prepare an Overpayment Referral Packet and send it to IDEC Bureau of Subsidy Management policy unit. The policy unit will review the Overpayment Referral reason and calculations and will either approve or deny the claim. This process results in all entities being made aware of the program violations and allows for follow up/continued monitoring of the client or provider. If the case does not meet the overpayment criteria, the Bureau of Subsidy Management will deny the referral and notify the referring agency. If the case meets the criteria for overpayment, Bureau of Subsidy Management will issue the Overpayment letter and send copies to the referring agency and to IDEC Bureau of Collections (BOC). 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: Subsidy management refers all substantiated overpayments to the IDEC Bureau of Collections (BOC) who creates an account receivable and tracks recoveries. BOC refers overpayment to the Illinois office of the Comptroller If the responsible party wishes to make payment arrangements, BOC will establish repayment amounts and a schedule. BOC also refers accounts receivable to the Illinois Office of the Comptroller to capture all or part of payments being issued to the responsible party from non-CCDF programs, Depending on the dollar amount, Federal, State or local law enforcement may opt to pursue prosecution. iii. [x] Recover through repayment plans. Describe the activities and the results of these activities based on the most recent analysis: If the responsible party requests to pay the required amount over time, the IDEC Bureau of Collections (BOC) will explain the payment options and how to submit payments for the parities agreement. Allowing providers and clients to establish a repayment plan allows for prolonged continuity of care. iv. [ ] Reduce payments in subsequent months. Describe the activities and the results of these activities based on the most recent analysis: v. [x] Recover through State/Territory tax intercepts. Describe the activities and the results of these activities based on the most recent analysis: The Illinois Office of the Comptroller will intercept payments being issued to responsible parties based on referral from the Bureau of Collections. Payments from the Child Care Assistance Program are not intercepted to help preserve continuity of care. vi. [x] Recover through other means. Describe the activities and the results of these activities based on the most recent analysis: Voluntary repayment of overpayments in full are sent to the IDEC Fiscal Unit for resubmission into the appropriate account. This allows providers to return funds that they have determined were made in error due to their billing/attendance processes, and to resolve overpayments without being referred to the Bureau of Collections or Comptrollers office. 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: The Lead Agency's Programmatic Monitoring Unit and CCAP Policy units oversee actions dealing with overpayment identification and recovery. These units work with all contracted site administered programs, child care programs, CCR&R agencies, as well as State agency staff. Staff from these units work with the Lead Agency's Bureau of Investigations, Office of the Inspector General and Bureau of Collections to identify and collect overpayments. By ensuring that the Program Integrity and Quality Assurance and Policy units investigate improper payments results in clients and providers being allowed to stay on the program while also allowing the state to recoup funds. 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: The minimum dollar amount after which recovery is required is $1.00. This aids in ensuring that any improper payment must be repaid to the program, regardless of the amount, while emphasizing the importance of adhering to program policies and procedure. This recovery of funds at a minimum of $1 results in lowering the percentage of overpayments and program violations. 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: As soon as an overpayment is identified, staff shall prepare an Overpayment Referral Packet and sent it to IDEC Bureau of Subsidy Management will review the Overpayment Referral and will either approve or deny the claim. If the case does not meet the overpayment criteria, the Bureau of Subsidy Management will deny the referral and notify the referring agency. If the case meets the criteria for overpayment, the Bureau of Subsidy Management will issue the Overpayment letter and send copies to the referring and to IDEC Bureau of Collections. iii. [x] Recover through repayment plans. Describe the activities and the results of these activities based on the most recent analysis: All repayment arrangements are handled by IDEC Bureau of Collections. Allowing providers and clients to establish a repayment plan results in clients and providers being allowed to stay on the program while also allowing the state to recoup funds. iv. [ ] Reduce payments in subsequent months. Describe the activities and the results of these activities based on the most recent analysis: v. [x] Recover through State/Territory tax intercepts. Describe the activities and the results of these activities based on the most recent analysis: IDEC Bureau of Collections will handle repayment arrangements. Recovering funds through the collection of taxes results in clients and providers being allowed to stay on the program while also allowing the state to recoup funds. vi. [x] Recover through other means. Describe the activities and the results of these activities based on the most recent analysis: Payment in full submitted by the responsible individual. By allowing providers and clients to pay in full results in clients and providers being allowed to stay on the program while also allowing the state to recoup funds. 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: The Lead Agency's Bureau of Subsidy Management Programmatic Monitoring Unit formerly known as Program Integrity and Quality Assurance and Policy units oversee actions dealing with overpayment identification and recovery. These units work with all contracted site administered programs, child care programs, CCR&R agencies, as well as State agency staff. Staff from these units work with the Lead Agency's Bureau of Investigations, Office of the Inspector General and Bureau of Collections to identify and collect overpayments. By ensuring that the Programmatic Monitoring Unit and Policy units investigate improper payments results in clients and providers being allowed to stay on the program while also allowing the state to recoup funds. 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: The minimum dollar amount after which recovery is required is $1.00. This aids in ensuring that any improper payment must be repaid to the program, regardless of the amount, while emphasizing the importance of adhering to program policies and procedure. This recovery of funds at a minimum of $1 results in lowering the percentage of overpayments and program violations. 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: As soon as an overpayment is identified, staff shall prepare an Overpayment Referral Packet and sent it to IDEC Bureau of Subsidy Management will review the Overpayment Referral and will either approve or deny the claim. If the case does not meet the overpayment criteria, the Bureau of Subsidy Management will deny the referral and notify the referring agency. If the case meets the criteria for overpayment, the Bureau of Subsidy Management will issue the Overpayment letter and send copies to the referring and to IDEC Bureau of Collections. iii. [x] Recover through repayment plans. Describe the activities and the results of these activities based on the most recent analysis: All repayment arrangements are handled by IDEC Bureau of Collections. Allowing providers and clients to establish a repayment plan results in clients and providers being allowed to stay on the program while also allowing the state to recoup funds. iv. [ ] Reduce payments in subsequent months. Describe the activities and the results of these activities based on the most recent analysis: v. [x] Recover through State/Territory tax intercepts. Describe the activities and the results of these activities based on the most recent analysis: The Illinois Office of the Comptroller will intercept payments being issued to responsible parties based on referral from the Bureau of Collections. Payments from the Child Care Assistance Program are not intercepted to help preserve continuity of care. vi. [ ]Recover through other means. Describe the activities and the results of these activities based on the most recent analysis: vii. [ ] 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: 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: The Department has the discretion to impose sanctions upon parents or other relatives that commit an intentional program violation or an act of fraud in an effort to obtain eligibility, benefits, or financial gain or profit from the Child Care Assistance Program to which they would otherwise not be entitled. The Department shall take into consideration the nature of the offense, whether or not an improper payment was made, the amount of the improper payment, and the length of time over which the offense occurred when determining the level of sanction to be imposed. IDEC is responsible for the detection, prevention, reduction, and identification of intentional program violations or fraud by parents or other relative recipients of child care benefits and child care providers. Clients can be removed from the program for a specific amount of time, or permanently, depending on the severity of the violation and/or the number of past violations that have been committed. Clients may file an appeal of any sanction within 60 days of the sanction decision that will conducted by the IDHS Bureau of Administrative Hearings (BAH). 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: The Department has the discretion to impose sanctions upon providers that commit an intentional program violation or an act of fraud in an effort to obtain eligibility, benefits, or financial gain or profit from the Child Care Assistance Program to which they would otherwise not be entitled. The Department shall take into consideration the nature of the offense, whether or not an improper payment was made, the amount of the improper payment, and the length of time over which the offense occurred when determining the level of sanction to be imposed. The Lead Agency is responsible for the detection, prevention, reduction, and identification of intentional program violations or fraud by parents or other relative recipients of child care benefits and child care providers. Licensed and exempt child care homes may fille a grievance through the Service Employees International Union (SEIU). Grievances must be filed with and received by the State within twenty-one (21) calendar days from the date the Union or Provider knew or should have known of the action or inaction that gave rise to the grievance. The levels of grievance are Step i ￿ Division of Early Childhood; Step 2 ￿ IDHS Bureau of Labor Relations; Step 3A ￿ Department of Central Management Services; Step 3B ￿ Arbitration iii. [x] Prosecute criminally. Describe the activities and the results of these activities based on the most recent analysis: All cases of suspected intentional program violations or fraud will be referred to the Division for investigation which may lead to the recovery of improper payments, sanctions, and/or criminal prosecution. Depending on the nature of the violation, the Division may refer cases to the Department of Healthcare and Family Services' Bureau of Investigations or the State of Illinois Office of the Executive Inspector General for additional review and potential prosecution as determined by the Office of the Attorney General. 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: