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COMBINED MANUAL

ISSUE DATE 08/2019

DETERMINING INCORRECT PAYMENT AMOUNTS

0025.03

When you find a payment was incorrect, reconstruct each budget month and corresponding payment month using the policies and procedures that were in effect for the payment month. The overpayment or underpayment is the difference between the benefit amount the client actually received and the benefit amount the client should have received.

Overpayments once computed must be entered on MAXIS through the CCOL/CLAM queue. See 0025.21.07 (JOL - Establishing Claims). For overpayment notice requirements, see 0026.39 (Notice of Overpayment and Recoupment). Enter claims you suspect are fraud claims as client error initially, and adjust them later to fraud if appropriate. Once entered on MAXIS, initiate recovery on collectible claims. See 0025.12.06 (Repaying Overpayments - Participants), 0025.12.09 (Repaying Overpayments - Non-Participants), 0025.24.03 (Recovering Fraudulently Obtained Assistance).

To determine if a client was overpaid, refer to other sections of this manual. For example, see 0022.21 (Income Overpayment Relating to Budget Cycle) to determine if an increase in income results in an overpayment. See 0008 (Changes in Circumstances) for information on other changes that may cause an overpayment or underpayment.

When computing overpayments, allow earned income disregards and work expense deductions only for earned income reported timely. Timeliness varies between programs, see program provisions. Do not allow the earned income disregard on income reported through other means such as IEVS, a “New Hire Message”, or a person other than the client, the authorized representative, or guardian. If a client reports only part of his/her earned income, do not allow earned income disregards on the income not reported timely. (For example, a client has 2 jobs but fails to report the 2nd job. When computing the overpayments, allow all the disregards on the earnings from the 1st job but not the 2nd job.) Also see 0018.06 (Work Expense Deductions), 0018.18 (Earned Income Disregards).

When processing a restored benefit on a case that has a claim for the same period, ALWAYS enter the claim first. MAXIS will apply the restored benefit amount to the claim when appropriate. See TEMP Manual TE02.08.025 (Restored Benefits Applied to a Claim).

Determine Discovery and Established Dates as part of the process for calculating a claim. See DISCOVERY DATE in 0002.15 (Glossary: Deed...), ESTABLISHED DATE in 0002.21 (Glossary: Employment...), TE02.09.01 (Entering Claims). Documents needed to calculate a claim could be wage stubs, W-2s, bank statements, employer verification, etc.

Do not include any amounts in the overpayment calculation that occurred more than 6 years prior to the Discovery Date for overpayments due to client error or fraud. Do not include amounts that occurred more than 1 year prior to the Discovery Date for overpayments due to agency error.

If the Discovery Date is not correctly identified it can result in monthly overpayments erroneously being included or excluded in a claim. See 0025.12.12 (Action On Overpayments - Time Limits).

MFIP: DO NOT establish an overpayment or underpayment for prospectively budgeted units for any month for which you based the assistance issued on the best information available at the time, if you applied the correct policy, and there was no client error.

DO NOT establish an overpayment when a 100% sanction has not been imposed due to the agency’s failure to act. See 0028.30.03 (Pre 60-Month Type/Length of ES Sanctions).

Use retrospective budgeting CONTINUOUSLY for all previously retrospectively budgeted months whether or not there were months of total ineligibility. DO NOT change budget cycles due to months of ineligibility.

For purposes of allowing the earned income disregard, a report is timely when the client or authorized representative reports income within 2 calendar months following the end of the month in which the income was received.

Reporting procedures and client notice requirements used when clients report timely do not apply when changes in household composition are not reported timely.

● When a mandatory unit member enters the household and the unit fails to report the change timely, calculate the overpayment starting with the month the mandatory unit member arrives.