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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: Minnesota participates in the Public Assistance Reporting Information System (PARIS) and follows-up on cases where the Social Security number of an individual identifies the client is active on public assistance in more than one state. Workers will refer cases to fraud as needed. In addition, Minnesota has an interface between the TANF program system (MAXIS) and the Social Security Administration for verification of social security numbers of individuals on the TANF program. While Child Care Assistance Program does not require the Social Security number of all family members, it is a requirement for the TANF and SNAP programs, and other programs on MAXIS. This information is integrated between the MAXIS and MEC². If a Child Care Assistance Program family has or is receiving benefits from a program on MAXIS, the Social Security number and verification information is in MEC². If the client information does not match the Social Security number, workers can refer to fraud as needed. The number of results for this activity is not tracked by Minnesota. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: Minnesota participates in the Public Assistance Reporting Information System (PARIS) and follows-up on cases where the social security number of an individual identifies the client is active on public assistance in more than one state. In addition, Minnesota has an interface between the TANF program system (MAXIS) and the Social Security Administration for verification of Social Security numbers of individuals on the TANF program. While Child Care Assistance Program does not require the Social Security number of all family members, it is a requirement for the TANF and SNAP programs, and other programs on MAXIS. This information is integrated between the MAXIS and MEC². If the client information does not match the Social Security number, workers can work with the families to determine the correct information. Working to clarify and obtain the correct information allows workers to identify and prevent unintentional program violations. The number of results for this activity is not tracked by Minnesota. iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice:: Minnesota participates in the Public Assistance Reporting Information System (PARIS) and follows-up on cases where the Social Security number of an individual identifies the client is active on public assistance in more than one state. In addition, Minnesota has an interface between the TANF program system (MAXIS) and the Social Security Administration for verification of Social Security numbers of individuals on the TANF program. While Child Care Assistance Program does not require the Social Security number of all family members, it is a requirement for the TANF and SNAP programs, and other programs on MAXIS. This information is integrated between the MAXIS and MEC² system. If the client information does not match the Social Security number, workers can work with families to determine the correct information. Working to clarify and obtain the correct information allows workers to identify and prevent agency errors. The number of results for this activity is not tracked by Minnesota. 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: Eligibility workers are allowed to override results in MEC² under certain situations. The department flags these overrides and requires local agencies who are above a threshold to report on these overrides. This allows the department to review and determine if override use was appropriate in local agencies with several overrides above the threshold. The department randomly selects cases with overrides to be reviewed each quarter. Local agencies are required to report the selected case override information to the department for review. Override usage has decreased approximately 16 percent over the last three years. The department currently uses a report to monitor manual payments made by local agencies. Local agencies that have more than 1% of payments that are manual receive additional contact from the department to identify issues to be addressed or system limitations. Ongoing technical assistance is also offered as needed. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: Eligibility workers are allowed to override results in MEC² under certain situations. The department flags these overrides and requires local agencies who are above a threshold to report on these overrides. This allows the department to review and determine if override use was appropriate in local agencies with several overrides above the threshold. The department randomly selects cases with overrides to be reviewed each quarter. Local agencies are required to report the selected case override information to the department for review. Override usage has decreased approximately 16 percent over the last three years. The department currently uses a report to monitor manual payments made by local agencies. Agencies that have more than 1% of payments that are manual receive additional contact from the department to identify issues to be addressed or system limitations. Ongoing technical assistance is also offered as needed. iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice: Eligibility workers are allowed to override results in MEC² under certain situations. The department flags these overrides and requires local agencies who are above a threshold to report on these overrides. This allows the department to review and determine if override use was appropriate in local agencies with several overrides above the threshold. The department randomly selects cases with overrides to be reviewed each quarter. Local agencies are required to report the selected case override information to the department for review. Override usage has decreased approximately 16 percent over the last three years. The department currently uses a report to monitor manual payments made by local agencies. Agencies that have more than 1% of payments that are manual receive additional contact from the department to identify issues to be addressed or system limitations. Ongoing technical assistance is also offered as needed. 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: Local agencies, the department, and law enforcement agencies may review billing and attendance records and investigate fraud. Providers are required to maintain daily attendance records for children receiving child care assistance and must include the date, first and last name and the times when the child is dropped off and picked up. Records must be available upon request by the local agency or the department. The local agency and/or the department can request attendance records when needed in the normal process of administering CCAP or when doing provider reviews. The local agency and/or the department may stop payment, deny or end a service authorization to a child care provider when the local agency knows or has reason to believe that the provider has not kept attendance records for children receiving CCAP. Local agencies and/or the department may also assess overpayments to providers for failure to comply with attendance record keeping policies. For intentional program violations, the local agency or OIG would pursue a disqualification. The OIG's CCAP Investigations and Audits unit receives and triages tips and referrals for possible investigation. In addition, the OIG’s CCAP Investigations and Audits unit is committed working with the OIG data team on a random selection process (all CCAP providers stand an equal chance of being selected) to identify CCAP providers for an attendance record monitoring visit (audit). Providers are required to report to the local agency, when child consecutive absences go above seven and when a child attends less than half of their authorized hours or days for a four-week period. The OIG’s CCAP Investigations and Audits unit uses a variety of methods, including conducting surveillance and comparing against attendance and billing records. OIG staff utilize specific Overpayment Tools to calculate overpayments depending on whether an overpayment resulted from attendance record violations (i.e., a comparison of attendance records against billing) or intentional overbilling (i.e., a comparison of surveillance against billing). Use of these tools creates consistency in the investigation process, documentation of findings, and overpayment calculation. During CY2023, CCAP agencies and the OIG established one Intentional Program Violation (IPV) against a provider, and CCAP agencies established 45 IPVs against CCAP recipients. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: Providers are required to maintain daily attendance records for children receiving child care assistance and must include the date, first and last name and the times when the child is dropped off and picked up. Records must be available upon request by the local agency or the department. The local agency and/or the department can request attendance records when needed in the normal process of administering CCAP or when doing provider reviews. The local agency and/or the department may stop payment, deny or end a service authorization to a child care provider when the local agency knows or has reason to believe that the provider has not kept attendance records for children receiving CCAP. Local agencies and/or the department may also assess overpayments to providers for failure to comply with attendance record keeping policies, and the OIG may issue a correction order. The OIG’s Early and Often unit collects and reviews attendance records at least twice during a licensed center’s first year of operation with the purpose of providing additional support and monitoring. If errors are found, a provider may be issued a correction order and/or an overpayment. Additionally, the OIG's CCAP Investigations and Audits unit receives and triages tips and referrals for possible investigation. In addition, the OIG’s CCAP Investigations and Audits unit is committed working with the OIG data team on a random selection process (all CCAP providers stand an equal chance of being selected) to identify CCAP providers for an attendance record monitoring visit (audit). Providers are required to report to the local agency, when child consecutive absences go above seven and when a child attends less than half of their authorized hours or days for a for-week period. if this occurs, local agencies should follow up with families and providers when information provided and/or reviewed shows additional actions are required, such as ending a child's authorization if a child stopped attending. Additionally, data-mining is used to generate reports based on red flag exceptions that may be an indication of improper payments. In CY2023 OIG Child Care Audits and Investigations opened 146 CCAP investigations. They took action in 50% of those cases, resulting in 72 overpayments (totaling more than $163,800) and 22 correction orders. iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice: If OIG staff discover agency errors, while reviewing attendance records or billing, they coordinate with CCAP policy staff to provide technical assistance to the local CCAP agency. If local CCAP agency staff discover agency errors while reviewing attendance records or billing, they may issue underpayments to the provider. If the department finds patterns in agency errors, we may update or issue new guidance to local agencies through policy manual updates, bi-monthly caseworker newsletters, and/or policy pointer emails. 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: Case accuracy reviews are required by all local agencies approximately once a quarter. Local agencies are required to complete an Accuracy Review form for each case selected by the department. This process focuses on one CCAP policy at a time, such as a policy used when determining eligibility, authorizing care, registering a provider, or making payments. During the most current completed reporting quarters, income policy was the focus of the case accuracy reviews. On average, there were 261 cases reviewed per quarter with 8.1% of cases resulting in an error. Errors included data entry mistakes, missing income sources, missing verifications, and inaccurate copayment amounts. Local agency workers are encouraged to conduct case management reviews. Templates are available for completion of either a case or provider targeted case review. These reviews may lead to prevention or identification of fraud or intentional program violations. If a local agency discovers suspected fraud during the course of an accuracy review, they follow standard procedures for making a fraud referral. In the most current plan cycle, 62 local agencies indicated they conduct case management reviews of CCAP cases and 33 conduct case management reviews of provider files. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: Case accuracy reviews are required by all local agencies approximately once a quarter. Agencies are required to complete an Accuracy Review form for each case selected by the department. This process focuses on one CCAP policy at a time, such as a policy used when determining eligibility, authorizing care, registering a provider, or making payments. During the most current completed reporting quarters, income policy was the focus of the case accuracy reviews. On average, there were 261 cases reviewed per quarter with 8.1% of cases resulting in an error. Errors included data entry mistakes, missing income sources, missing verifications, and inaccurate copayment amounts. Local agency workers are encouraged to conduct case management reviews. Templates are available for completion of either a case or provider targeted case review. These reviews may lead to prevention or identification of unintentional program violations. In the most current plan cycle, 62 local agencies indicated they conduct case management reviews of CCAP cases and 33 conduct case management reviews of provider files. iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice: Case accuracy reviews are required by all local agencies approximately once a quarter. Agencies are required to complete an Accuracy Review form for each case selected by the department. This process focuses on one CCAP policy at a time, such as a policy used when determining eligibility, authorizing care, registering a provider, or making payments. During the most current completed reporting quarters, income policy was the focus of the case accuracy reviews. On average, there were 261 cases reviewed per quarter with 8.1% of cases resulting in an error. Errors included data entry mistakes, missing income sources, missing verifications, and inaccurate copayment amounts. Local agency workers are encouraged to conduct case management reviews. Templates are available for completion of either a case or provider targeted case review. In the most current plan cycle, 62 local agencies indicated they conduct case management reviews of CCAP cases and 33 conduct case management reviews of provider files. e. [x] Audit provider records. i. [x] Intentional program violations. Describe the activities, the results of these activities, and how they inform better practice: Case accuracy reviews are required by all local agencies approximately once a quarter. Agencies are required to complete an Accuracy Review form for each case selected by the department. This process focuses on one CCAP policy at a time, such as a policy used when determining eligibility, authorizing care, registering a provider, or making payments. During the most current completed reporting quarters, income policy was the focus of the case accuracy reviews. On average, there were 261 cases reviewed per quarter with 8.1% of cases resulting in an error. Errors included data entry mistakes, missing income sources, missing verifications, and inaccurate copayment amounts. Local agency workers are encouraged to conduct case management reviews of provider information. Templates are available for completion of this type of review. This type of review may lead to prevention or identification of fraud or intentional program violations. In the most current plan cycle, 33 local agencies indicated they conduct case management reviews of provider files. OIG CCAP Investigations and Audits staff have begun working with the OIG data team on a random select process (all CCAP providers stand an equal chance of being selected) to identify CCAP Providers for an unannounced Attendance Record monitoring visit (audit). Minnesota law requires providers to keep, maintain, and make records available immediately to investigators, such as records pertaining to payroll and employees, children's attendance, banking and accounting, billing, business ownership, and transportation of children. OIG staff may review these records during the course of an investigation to determine whether an intentional program violation occurred. If Licensing staff identify potential concerns with provider records (e.g., attendance records, personnel files) during routine visits, they may make a referral to OIG CCAP Investigations and Audits staff for further investigation and review. For intentional program violations, the local agency or the OIG would pursue a disqualification. In CY2023, CCAP agencies and the OIG established one Intentional Program Violation (IPV) against a provider. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: Case accuracy reviews are required by all local agencies approximately once a quarter. Agencies are required to complete an Accuracy Review form for each case selected by the department. This process focuses on one CCAP policy at a time, such as a policy used when determining eligibility, authorizing care, registering a provider, or making payments. During the most current completed reporting quarters, income policy was the focus of the case accuracy reviews. On average, there were 261 cases reviewed per quarter with 8.1% of cases resulting in an error. Errors included data entry mistakes, missing income sources, missing verifications, and inaccurate copayment amounts. Local agency workers are encouraged to conduct case management reviews of provider information. Templates are available for completion of this type of review. This type of review may lead to prevention or identification of unintentional program violations. In the most current play cycle, 33 local agencies indicated they conduct case management reviews of provider files. OIG CCAP Investigations and Audits staff have begun working with the OIG data team on a random selection process (all CCAP providers stand an equal chance of being selected) to identify CCAP Providers for an Attendance Record monitoring visit (audit). Additionally, if Licensing staff identify potential concerns with provider records (e.g., attendance records, personnel files) during routine visits, they may make a referral to OIG CCAP Investigations and Audits staff for further investigation and review. In CY 2023, 92 percent of the attendance record reviews for CCAP resulted in a preliminary investigation being opened and, of those that closed, 50 percent resulted in an administrative action, which could include issuing a correction order and/or assessing an overpayment. iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice: Case accuracy reviews are required by all local agencies on a quarterly basis. Agencies are required to complete an Accuracy Review form for each case selected by the department. This process focuses on one CCAP policy at a time, such as a policy used when determining eligibility, authorizing care, registering a provider, or making payments. During the most current completed reporting quarters, income policy was the focus of the case accuracy reviews. On average, there were 261 cases reviewed per quarter with 8.1% of cases resulting in an error. Errors included data entry mistakes, missing income sources, missing verifications, and inaccurate copayment amounts. Local agency workers are encouraged to conduct case management reviews of provider information. Templates are available for completion of this type of review. This type of review may lead to prevention or identification of agency errors. In the most current play cycle, 33 local agencies indicated they conduct case management reviews of provider files. 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: Staff within local agencies are required to attend a new worker training that includes both child care assistance policy and system instruction. In early 2023, a Child Care Assistance Program refresher training was offered around the state to approximately 266 CCAP eligibility workers income, copayments, and other policy and system updates. When requested, education and training sessions are provided to county and Tribal workers around the State providing information about how department Case Reviews are conducted and current error rates. Having a better understanding about department case reviews may help local agency workers to identify unintentional program violations. During calendar year 2023, four outreach sessions were conducted around the state at local agencies and large conference venues. State staff within the Office of Inspector General conduct routine and non-routine training for financial workers and fraud prevention investigation (FPI) staff that is geared toward educating on what fraud is, the importance of fraud referrals, and identifying and investigating potential fraud by CCAP recipients and providers. Additionally, the same OIG staff conduct ongoing trainings for eligibility workers/supervisors/FPI's, and prosecutors on fraud indicators, investigations, steps to establish that fraud exists, and establishing burden of proof, and criminal considerations. New OIG staff are required to take policy and system trainings that are specific to their MEC² role(s). Additionally, department policy staff routinely coordinate and collaborate with OIG staff by providing policy guidance and technical assistance. For example, as a method of ongoing training, OIG staff have a system for submitting, reviewing, and logging policy questions. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: Staff within local agencies are required to attend a new worker training that includes both child care assistance policy and system instruction. In early 2023, a Child Care Assistance Program refresher training was offered around the state to approximately 266 CCAP eligibility workers income, copayments, and other policy and system updates. When requested, education and training sessions are provided to local agency workers around the State providing information about how department Case Reviews are conducted and current error rates. Having a better understanding about department case reviews may help local agency workers to identify unintentional program violations. During calendar year 2023, four outreach sessions were conducted around the state at local agencies and large conference venues. New OIG staff are required to take policy and system trainings that are specific to their MEC² role(s). Additionally, department policy staff routinely coordinate and collaborate with OIG staff by providing policy guidance and technical assistance. For example, as a method of ongoing training, OIG staff have a system for submitting, reviewing, and logging policy questions. iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice: When requested, education and training sessions are provided to local agency workers around the state providing information about how department case reviews are conducted and current error rates. Having a better understanding about department case reviews may help local agency workers identify agency errors. During calendar year 2023, four outreach sessions were conducted around the state at local agencies and large conference venues. 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): Local agencies and state staff are responsible for pursuing fraud disqualifications and overpayments. CCAP Investigations and Audits is a unit within the Program Integrity and Oversight Division (OIG) of the Office of Inspector General (OIG). CCAP Investigations and Audits, in collaboration with county and Tribal agencies, works to prevent public assistance fraud. The department's CCAP Investigations and Audits unit primarily investigate fraud involving child care providers. Through the Fraud Prevention Investigations (FPI) program, the OIG PIO works with counties to investigate recipient fraud by administering a $5.2 million ($2.6 million state funds, $2.6 million federal funds) annual grant program that funds investigator positions in counties and regions covering 85 of Minnesota’s 87 counties. All Minnesota counties are statutorily required to submit to the OIG a state fiscal year plan to coordinate county duties related to the prevention, investigation, and prosecution of fraud in public assistance programs. The agency that investigates and establishes fraud and uncovers the overpayment (local agency or the OIG) is responsible for assessing and collecting any resulting overpayments. If a provider or family appeals fraud or an overpayment uncovered by a local agency (i.e. county or Tribe), local agency program staff and/or the County Attorney’s Office handles the appeal. If a provider or family appeals fraud or an overpayment uncovered by OIG staff, appeals are handled by the State Attorney General staff in coordination with the OIG. 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. [ ] 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: 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: Through the FPI program, the Office of Inspector General’s Program Integrity and Oversight Division (PIO) presently works with local agencies to investigate recipient fraud. The division currently administers a 5.2 million annual grant program that funds investigator positions and fraud prevention training and resources in counties and regions covering 85 of Minnesota’s 87 counties. The department partners with grant and non-grant funded counties, helping to stretch the limited funds used to conduct investigations. This is done through training and monitoring work products. Resources that counties contribute to maintain investigative programs include the hiring and supervision of additional employees, as well as providing technological resources, equipment, office space, grant oversight, additional training and vehicles. State OIG staff conduct training for both local agency fraud investigators as well as eligibility staff, and county prosecutors, on methods of recouping/recovering improper payments made as the result of fraud. Methods include civil actions as well as restitution requested at the conclusion of a criminal case. OIG-PIO also funds an inter-agency agreement with the Minnesota Bureau of Criminal Appreciation to support referrals and criminal investigations of suspected provider fraud. iii. [x] Recover through repayment plans. Describe the activities and the results of these activities based on the most recent analysis: Families and/or providers and the agency that assessed an overpayment can agree to a repayment plan when participants are no longer eligible for the program or if the provider is no longer caring for children receiving child care assistance. Allowing families and/or providers to establish a repayment plan allows for payment based on ability to pay. The repayment plan is a legally binding agreement between the agency that assessed the overpayment and the participant or provider. Minnesota does not collect statewide data on recoupments made through a repayment plan. iv. [x] Reduce payments in subsequent months. Describe the activities and the results of these activities based on the most recent analysis: The recovery method for collecting overpayments from eligible participant families and current CCAP providers is recoupment. If the family or provider becomes eligible after serving their penalty period, recoupment amounts for fraud are as follows: Family overpayments: In CY23 $90,881 was collected via recoupment on 3,982 claims. • If the overpayment is due to provider error or a combination of provider and agency error, recoup the greater of one-fourth of the family’s copayment, or $10. • If the overpayment is due to the family’s first failure to report changes or a combination of a family’s first failure to report and agency error, recoup the greater of one half of the family’s copayment, or $10. • If the overpayment is due to the family’s failure to provide accurate information at application or redetermination or the family’s second or subsequent failure to report changes or a combination of these violations with agency error, recoup the greater of one half of the family’s copayment, or $50. • When the overpayment is due to wrongfully obtaining public assistance as established by court conviction, court-ordered stay of conviction with probationary or other terms, a disqualification agreement, a pretrial diversion, or an administrative disqualification hearing or waiver, recoup the greater of the family’s copayment, 10 percent of the overpayment, or $100. Provider overpayments: In CY23 $373,886 was collected via recoupment on 946 claims. • When a provider has an overpayment due to family error or a combination of family and agency error, the recoupment amount is one-tenth the provider's payment or $20, whichever is greater. • When a provider has an overpayment due to the provider's failure to provide accurate information or a combination of failure to report accurate information and agency error, the recoupment amount is one-fourth the provider's payment or $50, whichever is greater. • When a provider has an overpayment due to wrongfully obtaining child care assistance as established by a court conviction, a court-ordered stay of conviction with probationary or other terms, a disqualification agreement, a pretrial diversion, or an administrative disqualification, the recoupment amount equals the greater of: One-half the provider's payment OR 10 percent of the overpayment OR $100. v. [x] Recover through State/Territory tax intercepts. Describe the activities and the results of these activities based on the most recent analysis: Recovery of funds is made through interception of both federal and state tax return refunds. Of the total collected in SFY23, 7 percent was collected through tax intercepts on fraudulent claims or intentional program violations. 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: CCAP Investigations and Audits is a unit within the Program Integrity and Oversight Division (PIO) of the Office of Inspector General (OIG). CCAP Investigations and Audits works in collaboration with county and Tribal agencies and the Minnesota Bureau of Criminal Apprehension and is responsible for investigating alleged or suspected financial misconduct by providers and errors related to payments issued by CCAP and ARPA Stabilization grants. CCAP Investigations and Audits is comprised of one unit manager, three supervisors, 12 investigators, and one program specialist. The unit receives legal support from the OIG legal division, and data and analytics support from the OIG Data and Analytics division. During CY2023, the CCAP Audits and Investigations unit (including CCAP investigations, Early and Often monitoring, and ARPA Stabilization Grant investigations) had 528 intakes. Out of the 528 intakes, 304 investigations were conducted, which resulted in issuing 22 correction orders and identifying more than $3.7 million in overpayments and recoupment. Results pertain to investigations of all financial misconduct by providers, including potential fraud (intentional program violations) and unintentional program violations (errors). By taking measures to address issues early, this may prevent fraud before it occurs. viii. [x] Other. Describe the activities and the results of these activities: Through the FPI program, the Office of Inspector General’s Program Integrity and Oversight Division (PIO) presently works with counties to investigate recipient fraud. The division currently administers a $5.2 million annual grant program that funds investigator positions and fraud prevention training and resources in counties and regions covering 85 of Minnesota’s 87 counties. OIG-PIO partners with grant and non-grant funded counties, helping to stretch the limited funds used to conduct investigations. This is done through training and monitoring work products. Resources that counties contribute to maintain investigative programs include the hiring and supervision of additional employees, as well as providing technological resources, equipment, office space, grant oversight, additional training and vehicles. OIG-PIO also funds an inter-agency agreement with the Minnesota Bureau of Criminal Appreciation to support referrals and criminal investigations of suspected provider fraud. 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: Minnesota allows for a minimum dollar amount of $50 when recovering unintentional program violations and administrative errors. Minnesota does not have a minimum dollar amount when recovering fraud claims (i.e. the minimum amount is $0). If an overpayment results from an unintentional program violation, it cannot go back more than six years from the date the agency determines the overpayment. 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: If a review by the OIG finds intentional program violations the investigation is sent to Minnesota Bureau of Criminal Apprehension for possible criminal charges. iii. [x] Recover through repayment plans. Describe the activities and the results of these activities based on the most recent analysis: Families and/or providers and the agency that assessed an overpayment can agree to a repayment plan when participants are no longer eligible for the program or if the provider is no longer caring for children receiving child care assistance. Allowing families and/or providers to establish a repayment plan allows for payment based on ability to pay. The repayment plan is a legally binding agreement between the agency that assessed the overpayment and the participant or provider. Minnesota does not collect statewide data on recoupments made through a repayment plan. iv. [x] Reduce payments in subsequent months. Describe the activities and the results of these activities based on the most recent analysis: The recovery method for collecting overpayments from eligible participant families and current CCAP providers is recoupment. If the family or provider becomes eligible after serving their penalty period, recoupment amounts for fraud are as follows: Family overpayments • If the overpayment is due to provider error or a combination of provider and agency error, recoup the greater of one-fourth of the family’s copayment, or $10. • If the overpayment is due to the family’s first failure to report changes or a combination of a family’s first failure to report and agency error, recoup the greater of one half of the family’s copayment, or $10. • If the overpayment is due to the family’s failure to provide accurate information at application or redetermination or the family’s second or subsequent failure to report changes or a combination of these violations with agency error, recoup the greater of one half of the family’s copayment, or $50. • When the overpayment is due to wrongfully obtaining public assistance as established by court conviction, court-ordered stay of conviction with probationary or other terms, a disqualification agreement, a pretrial diversion, or an administrative disqualification hearing or waiver, recoup the greater of the family’s copayment, 10 percent of the overpayment, or $100. Provider overpayments • When a provider has an overpayment due to family error or a combination of family and agency error, the recoupment amount is one-tenth the provider's payment or $20, whichever is greater. • When a provider has an overpayment due to the provider's failure to provide accurate information or a combination of failure to report accurate information and agency error, the recoupment amount is one-fourth the provider's payment or $50, whichever is greater. • When a provider has an overpayment due to wrongfully obtaining child care assistance as established by a court conviction, a court-ordered stay of conviction with probationary or other terms, a disqualification agreement, a pretrial diversion, or an administrative disqualification, the recoupment amount equals the greater of: One-half the provider's payment OR 10 percent of the overpayment OR $100. v. [x] Recover through State/Territory tax intercepts. Describe the activities and the results of these activities based on the most recent analysis: Recovery of funds is made through interception of both federal and state tax return refunds. Of the total collected in SFY23, 30 percent was collected through tax intercepts on unintentional program violations. vi. [x] Recover through other means. Describe the activities and the results of these activities based on the most recent analysis: Following are other ways in which recovery of funds for unintentional program violations can occur: a) recoupment of funds by reducing the amount of assistance paid; b) Civil Recovery: if the family no longer receives child care assistance or the provider is no longer caring for children receiving child care assistance and a repayment plan is not agreed upon; c) recovery of unintentional program violation funds by compromising the claim is available to families when the overpayment is not due to fraud. Compromising a claim involves payment of 75 percent of the claim is paid within 90 days of when the initial notification of the claim. Of the total collected in SFY23, 31 percent was collected through recoupment and compromise of claims for unintentional errors. 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: CCAP Investigations and Audits is a unit within the Program Integrity and Oversight Division (PIO) of the Office of Inspector General (OIG). CCAP Investigations and Audits works in collaboration with county and Tribal agencies and the Minnesota Bureau of Criminal Apprehension and is responsible for investigating alleged or suspected financial misconduct by providers and errors related to payments issued by CCAP and ARPA Stabilization grants. CCAP Investigations and Audits is comprised of one unit manager, three supervisors, 12 investigators, and one program specialist. The unit receives legal support from the OIG legal division, and data and analytics support from the OIG Data and Analytics division. During CY2023, the CCAP Audits and Investigations unit (including CCAP investigations, Early and Often monitoring, and ARPA Stabilization Grant investigations) had 528 intakes. Out of the 528 intakes, 304 investigations were conducted, which resulted in issuing 22 correction orders and identifying more than $3.7 million in overpayments and recoupment. Results pertain to investigations of all financial misconduct by providers, including potential fraud (intentional program violations) and unintentional program violations (errors). By taking measures to address issues early, this may prevent fraud before it occurs. viii. [x] Other. Describe the activities and the results of these activities: Collection staff at the local level are focused on collecting all improper payments unintentional program violations, intentional program violations and/or fraud resulting in overpayments assessed by their agencies. 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: Minnesota allows for a minimum dollar amount of $50 when recovering unintentional program violations and administrative errors. Minnesota does not have a minimum dollar amount when recovering fraud claims (i.e. the minimum amount is $0). Local agencies and state staff cannot recover overpayments that result solely from agency error, and not from a family or provider’s acts or omissions. Overpayments that result from a combination of agency error and a family or provider’s action or omissions can be recovered. If an overpayment results from a combination of agency error and a family or provider’s acts or omissions, it cannot go back more than six years from the date the agency determines the overpayment. ii. [ ] 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: iii. [x] Recover through repayment plans. Describe the activities and the results of these activities based on the most recent analysis: Families and/or providers and the agency that assessed the overpayment can agree to a repayment plan when non-participants are no longer eligible for the program or if the provider is no longer caring for children receiving child care assistance. Allowing families and/or providers to establish a repayment plan allows for payment based on ability to pay. The repayment plan is a written agreement between the two parties. Minnesota does not collect data on when collections are made through a repayment plan. iv. [x] Reduce payments in subsequent months. Describe the activities and the results of these activities based on the most recent analysis: Family overpayments • If the overpayment is due to provider error or a combination of provider and agency error, recoup the greater of one-fourth of the family’s copayment, or $10. • If the overpayment is due to the family’s first failure to report changes or a combination of a family’s first failure to report and agency error, recoup the greater of one half of the family’s copayment, or $10. • If the overpayment is due to the family’s failure to provide accurate information at application or redetermination or the family’s second or subsequent failure to report changes or a combination of these violations with agency error, recoup the greater of one half of the family’s copayment, or $50. • When the overpayment is due to wrongfully obtaining public assistance as established by court conviction, court-ordered stay of conviction with probationary or other terms, a disqualification agreement, a pretrial diversion, or an administrative disqualification hearing or waiver, recoup the greater of the family’s copayment, 10 percent of the overpayment, or $100. Provider overpayments • When a provider has an overpayment due to family error or a combination of family and agency error, the recoupment amount is one-tenth the provider's payment or $20, whichever is greater. • When a provider has an overpayment due to the provider's failure to provide accurate information or a combination of failure to report accurate information and agency error, the recoupment amount is one-fourth the provider's payment or $50, whichever is greater. • When a provider has an overpayment due to wrongfully obtaining child care assistance as established by a court conviction, a court-ordered stay of conviction with probationary or other terms, a disqualification agreement, a pretrial diversion, or an administrative disqualification, the recoupment amount equals the greater of: One-half the provider's payment OR 10 percent of the overpayment OR $100. v. [x] Recover through State/Territory tax intercepts. Describe the activities and the results of these activities based on the most recent analysis: Recovery of funds is made through interception of both federal and state tax return refunds. Of the total collected in SFY23, 4 percent was collected through tax intercepts for agency errors. Collections may have included overpayments that resulted solely from agency error or from a combination of agency error and family or provider errors. State law eliminating collection of overpayments that result solely from agency error took effect on 8/1/21. vi. [x]Recover through other means. Describe the activities and the results of these activities based on the most recent analysis: Following are other ways in which recovery of funds for agency errors can occur: a) recoupment of funds by reducing the amount of assistance paid; b) Civil Recovery: if the family no longer receives child care assistance or the provider is no longer caring for children receiving child care assistance and a repayment plan is not agreed upon; c) recovery of funds due to agency error by compromising the claim is available to families. Compromising a claim involves payment of 75 percent of the claim is paid within 90 days of when the initial notification of the claim. Of the total collected in SFY23, 5 percent was collected through recoupment and compromise of claims on agency errors. Collections may have included overpayments that resulted solely from agency error or from a combination of agency error and family or provider errors. State law eliminating collection of overpayments that result solely from agency error took effect on 8/1/21. 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. [x] Other. Describe the activities and the results of these activities: Department of Children, Youth and Families Program Compliance and Audit staff do monthly case reviews that identify administrative errors. The department sends county and tribal agencies information about the administrative errors and they are required to follow up, providing feedback to the department. Minnesota performs case accuracy reviews on a quarterly basis that identify administrative errors. Case accuracy reviews require all agencies to complete an Accuracy Review form for each case selected by the Department of Children, Youth and Families. This process focuses on one CCAP policy at a time, such as a policy used when determining eligibility, authorizing care, registering a provider, or making payments. Collections staff at the local level are focused on collecting all improper payments - unintentional program violations, intentional program violations and/or fraud and administrative errors resulting in overpayments. In addition to investigating provider fraud, department OIG conducts reviews of provider attendance records. 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: Fraud investigations that determine whether a client has committed an Intentional Program Violation (IPV) will be resolved through the Administrative Disqualification Hearing (ADH) process or through a criminal prosecution process. The local investigator determines which process to pursue depending on the case specifics. The ADH process starts by providing the client an opportunity to sign a waiver admitting to the findings and/or agreeing to accept the consequences of a disqualification. If the client does not sign a waiver, they participate in a hearing, overseen by a Human Services Judge, where they have the opportunity to dispute the findings. The criminal prosecution process usually involves criminally charging the client and the client having the opportunity to dispute the findings through the court process. A disqualification consent agreement or a court approved pre-trial diversion plan might also be used in the criminal prosecution process. If an IPV is determined to have occurred through any of these processes, the family is disqualified from receiving Child Care Assistance Program payments according to the following standards: 1) One year for the first offense 2) two years for the second offense 3) subsequent violations must result in permanent disqualification. Once a disqualification has been imposed, it is only appealable through district or appellate court action. During CY2023, CCAP agencies have established Intentional Program Violations (IPV) against 45 CCAP recipients. 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: Investigations that result in a determination that a provider has committed an Intentional Program Violation (IPV) will be resolved through the Administrative Disqualification Hearing (ADH) process or through a criminal prosecution process. In local agencies, the investigator determines which process to pursue depending on the case specifics. At the state level a case may be investigated both administratively and criminally. Department of Children, Youth and Families CCAP Investigations may conduct an administrative investigation that results in a referral to the Minnesota Bureau of Criminal Apprehension (BCA) for a criminal investigation. The BCA can also pursue a criminal investigation independent of OIG CCAP Investigations. Agencies initiate an administrative disqualification for providers by sending written notice via certified mail. The agency’s notice includes: a) the factual basis for the agency's determination, b) the action the agency intends to take, c) the dollar amount of the monetary recovery or recoupment, if known, and d) the provider's right to appeal the agency's proposed action. The provider has 30 days from the date the agency mails the notice to file an appeal in writing with the Department of Children, Youth and Families Appeals Division. The provider’s written appeal must: a) list each item in the notice the provider disagrees with, the reason(s) they disagree, and, if applicable, the dollar value of each item they disagree with, b) state the dollar amount the provider disagrees with (if applicable), c) provide legal references they believe support their position, and d) give a name, address and telephone number of a person at the provider’s business that can be contacted about the appeal. Providers may use the Child Care Assistance Program (CCAP) Provider Appeal to State Agency form (DHS-8075) to appeal, which includes all the required components for provider appeals. If the provider appeals timely, they have the opportunity to dispute findings at a hearing where a Human Services Judge either affirms or reverses the disqualification. If the provider does not appeal timely, the administrative disqualification is final. The criminal prosecution process usually involves criminally charging the provider and the provider has the opportunity to dispute the findings through the court process. A disqualification consent agreement or a court approved pre-trial diversion plan might also be used in the criminal prosecution process. If an IPV or fraud is determined to have occurred through any of these processes, the provider is disqualified from receiving payments for child care services from the Child Care Assistance Program to the following standards: 1) three years for the first offense, or 2) permanently for any subsequent offense. Once a disqualification has been imposed through the administrative process or through the criminal courts, which both allow a provider the opportunity for due process, it is only appealable through district or appellate court action. In addition to being disqualified from receiving subsidy payments, a disqualification (criminal or administrative) may affect a provider’s ability to clear a background study, hold a child care license or certification, have direct contact or access to children in a child care setting, and/or participate in other Department of Children, Youth and Families programs. In addition, the Office of Inspector General (OIG) may disenroll, revoke or suspend a license, disqualify, or debar a provider under Minn. Stat. § 245.095 (Limits on receiving public funds), which allows the department to act when a provider has been excluded form any publicly funded program administered by DCYF or another state or federal agency. This provision also allows the department to temporarily, immediately withhold payments when there is a credible allegation of fraud for which an investigation is pending. Effective 7/1/23, for actions taken under Minn. Stat. § 245.095, a provider may request: • A contested case hearing if the department disenrolls, revokes or suspends a license, disqualifies, or debars a provider because the provider has been excluded from another publicly funded program. A provider’s request for a contested case hearing must: o Be in writing o Be received by the department within 30 days of the date the notice was mailed o Include: Each item the provider disagrees with and the reason(s) the provider disagrees The statute and/or rule references the provider believes supports their position The name and address of a contact for the provider’s appeal Any other specific information required by the department. • An administrative reconsideration if the provider’s payments are temporarily, immediately withheld due to a credible allegation of fraud for a publicly funded program. o A provider’s request for administrative reconsideration must: Be submitted to the department in writing Include arguments and proof as to why the provider thinks the department’s decision to temporarily suspend payment is wrong. o Within 60 days of receiving a provider’s request for administrative reconsideration, the department will review all information available (including information the provider submitted) to determine whether to continue withholding payments. In CY2023, CCAP agencies and the OIG established one disqualification against a provider. iii. [x] Prosecute criminally. Describe the activities and the results of these activities based on the most recent analysis: In cases where investigators believe there exists proof beyond a reasonable doubt that the provider intended to commit theft of program funds, county or state criminal investigators may refer a case to county, state, or federal attorneys for possible prosecution. If prosecution is declined, the cases are submitted for an Administrative Disqualification. In CY2023 CCAP agencies and the OIG established one provider disqualification as the result of a court ordered stay with probationary or other conditions. iv. [x] Other. Describe the activities and the results of these activities based on the most recent analysis: Local agencies and the OIG have the option to withhold a provider's authorization or payments if the provider: 1. Admits to giving material false information on a billing form, 2. Was found to have intentionally provided false information on attendance records or billing forms, as determined by a preponderance of evidence, 3. Violates child care assistance program rules, until those rules are corrected, 4. Operates after receipt of an order of suspension or an order of revocation, 5. Submits false attendance reports or refuses to supply them, 6. Gives false price information, 7. Fails to report when a child’s actual attendance in a four-week period drops to less than half of their scheduled hours or days. Conditions 1 and 2 listed above allow local agencies and the OIG to immediately stop a provider’s payments under specific circumstances. These actions, often referred to as payment stops, permit or require agencies to temporarily suspend payments, including for past service dates, while an investigation or disqualification is pending. To stop a provider’s CCAP payments, a local agency must: • Complete a provider fraud referral and/or pursue a disqualification (i.e., Intentional Program Violation (IPV)); and • Include conditions 1 or 2 in their County and Tribal Fund Plan and apply policies consistently. Note In addition to conditions 1 and 2 above, the law requires the department to immediately stop a provider’s payments if the department finds a provider is improperly recruiting employees A payment stop may be issued: • As a stand-alone action, for example when criminal charges are pending, or an administrative disqualification notice hasn’t been issued yet; or • At the same time as an administrative disqualification notice. Once an IPV is established, the provider forfeits the rights to any past bills and is disqualified from receiving payments for child care services from the Child Care Assistance Program to the following standards: • Three years for the first offense. • Permanently for any subsequent offense. In CY2023, OIG staff issued 1 payment stop, and local agencies issued zero payment stops. For conditions 3, 5, 6, and 7 local agencies, or the department may withhold a provider’s authorization or payment for up to three months beyond the time when corrections have been made by the provider. In CY2023, DHS and local CCAP agencies closed or denied CCAP zero provider registrations using conditions 3, 5, 6, or 7. For condition 4, which involves situations when a licensed or certified provider is operating while appealing a Licensing order of suspension, revocation, or decertification, the OIG or a local agency withholds the provider’s registration until they receive confirmation from Licensing the suspension, revocation, or decertification has been reversed. Implementation for: • Licensed and certified child care centers is handled state-wide by OIG staff • Licensed family child care providers is handled by local that choose this policy in their County and Tribal Child Care Fund Plan. In CY2023, DHS and local CCAP agencies closed or denied CCAP registrations for 6 providers using condition 4. Additionally, child care assistance payments to a licensed or certified center are restricted to 25 or fewer children of employees per center. If a child care center is authorized for more than 25 children of center employees, the local agency cannot authorize additional dependents of an employee until the number of children falls below 25. 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: