10.2 Fraud Investigation, Payment Recovery, and Sanctions

Lead Agencies must have the necessary controls to identify fraud and other program violations to ensure program integrity. Program violations can include both intentional and unintentional client and/or provider violations, as defined by the Lead Agency. These violations and errors, identified through the error-rate review process and other review processes, may result in payment or nonpayment (administrative) errors and may or may not be the result of fraud, based on the Lead Agency definition. 10.2.1 Strategies used to identify and prevent program violations Check the activities the Lead Agency employs to ensure program integrity, and for each checked activity, identify what type of program violations the activity addresses, describe the activity and the results of these activities based on the most recent analysis. a. [x] Share/match data from other programs (e.g., TANF program, Child and Adult Care Food Program, Food and Nutrition Service (FNS), Medicaid) or other databases (e.g., State Directory of New Hires, Social Security Administration, Public Assistance Reporting Information System (PARIS)). i. [x] Intentional program violations. Describe the activities, the results of these activities, and how they inform better practice: The Lead Agency may use information provided for other Economic Assistance Programs such as LIHEAP, SNAP, TANF and Health Care Coverage for the Child Care Assistance Program (CCAP). The Lead Agency’s integrated data system allows the option to search multiple interfaces and sources to be searched for household members at the same time. The sharing and matching of data with other programs and searching interfaces serves as a lead to eligibility workers to request additional information from income or other benefits sources that may not have been reported by the applicant. The results of this activity reduce the risk of incorrect eligibility. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: The Lead Agency may use information provided for other Economic Assistance Programs such as LIHEAP, SNAP, TANF and Health Care Coverage for the Child Care Assistance Program (CCAP). The Lead Agency’s integrated data system allows the option to search multiple interfaces and sources to be searched for household members at the same time. The sharing and matching of data with other programs and searching interfaces serves as a lead to eligibility workers to request additional information from income or other benefits sources that may not have been reported by the applicant. The results of this activity reduce the risk of incorrect eligibility. iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice:: The Lead Agency may use information provided for other Economic Assistance Programs such as LIHEAP, SNAP, TANF and Health Care Coverage for the Child Care Assistance Program (CCAP). The Lead Agency’s integrated data system allows the option to search multiple interfaces and sources to be searched for household members at the same time. The sharing and matching of data with other programs and searching interfaces serves as a lead to eligibility workers to request additional information from income or other benefits sources that may not have been reported by the applicant. The results of this activity reduce the risk of incorrect eligibility. b. [x] Run system reports that flag errors (include types). i. [x] Intentional program violations. Describe the activities, the results of these activities, and how they inform better practice: The Lead Agency has red flag reports to help identify intentional program violations including the duplicate payment report, the CCAP payment over licensed number report, and the $1 payment request report. The duplicate payment report identifies if multiple payments have been issued to a provider on behalf of the same child for a service month. The CCAP payment over licensed number report compares the total children paid for a service month to the total number of children a provider is licensed to care for. The $1 payment request report monitors when a provider requests only a $1 for payment for a month. The results of reviewing the duplicate payment report are to determine if the payments issued are correct or if has been issued in error, it is researched to determine how it occurred, how it could be prevented in the future, or if there were any fraudulent billings by the provider. The results of reviewing the CCAP payment over licensed number report are if a provider is discovered to be receiving more payments for children than they are licensed for, then additional research will be conducted to determine if there is fraud. The Lead Agency’s licensing staff will be involved as needed in these situations. The results of reviewing the $1 payment request report are to determine if these requests have been submitted in error. Additional training may be needed for providers identified on any of these reports, in addition to potential overpayments. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: The Lead Agency has red flag reports to help identify intentional program violations including the duplicate payment report, the CCAP payment over licensed number report, and the $1 payment request report. The duplicate payment report identifies if multiple payments have been issued to a provider on behalf of the same child for a service month. The CCAP payment over licensed number report compares the total children paid for a service month to the total number of children a provider is licensed to care for. The $1 payment request report monitors when a provider requests only a $1 for payment for a month. The results of reviewing the duplicate payment report are to determine if the payments issued are correct or if has been issued in error, it is researched to determine how it occurred, how it could be prevented in the future, or if there were any fraudulent billings by the provider. The results of reviewing the CCAP payment over licensed number report are if a provider is discovered to be receiving more payments for children than they are licensed for, then additional research will be conducted to determine if there is fraud. The Lead Agency’s licensing staff will be involved as needed in these situations. The results of reviewing the $1 payment request report are to determine if these requests have been submitted in error. Additional training may be needed for providers identified on any of these reports, in addition to potential overpayments. iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice: The Lead Agency has red flag reports to help identify intentional program violations including the duplicate payment report, the CCAP payment over licensed number report, and the $1 payment request report. The duplicate payment report identifies if multiple payments have been issued to a provider on behalf of the same child for a service month. The CCAP payment over licensed number report compares the total children paid for a service month to the total number of children a provider is licensed to care for. The $1 payment request report monitors when a provider requests only a $1 for payment for a month. The results of reviewing the duplicate payment report are to determine if the payments issued are correct or if has been issued in error, it is researched to determine how it occurred, how it could be prevented in the future, or if there were any fraudulent billings by the provider. The results of reviewing the CCAP payment over licensed number report are if a provider is discovered to be receiving more payments for children than they are licensed for, then additional research will be conducted to determine if there is fraud. The Lead Agency’s licensing staff will be involved as needed in these situations. The results of reviewing the $1 payment request report are to determine if these requests have been submitted in error. Additional training may be needed for providers identified on any of these reports, in addition to potential overpayments. 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: The Lead Agency’s payment system ensures that attendance records are submitted for every month a provider requests payment for. If an attendance record for a prior month has not been submitted and a provider has received payment, the system will not allow a future payment until an attendance record for the prior month has been uploaded. An attendance record report is also generated monthly to monitor that attendance records are being submitted for all provider who have requested a payment from CCAP. The results from the attendance record report are that providers are monitored to ensure attendance records are being submitted. A selection of provider attendance records is randomly reviewed for accuracy, and providers are contacted for corrections and clarifications as needed. The monitoring of attendance records help ensures child care providers are correctly completing attendance records and certifying for Child Care Assistance payments accurately. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: The Lead Agency’s payment system ensures that attendance records are submitted for every month a provider requests payment for. If an attendance record for a prior month has not been submitted and a provider has received payment, the system will not allow a future payment until an attendance record for the prior month has been uploaded. An attendance record report is also generated monthly to monitor that attendance records are being submitted for all provider who have requested a payment from CCAP. The results from the attendance record report are that providers are monitored to ensure attendance records are being submitted. A selection of provider attendance records is randomly reviewed for accuracy, and providers are contacted for corrections and clarifications as needed. The monitoring of attendance records help ensures child care providers are correctly completing attendance records and certifying for Child Care Assistance payments accurately. iii. [ ] Agency errors. Describe the activities, the results of these activities, and how they inform better practice: 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: The Quality Control unit conducts case file reviews to ensure policies and procedures are being properly applied across a monthly statewide caseload sample. The results of this are that based on the findings from the Quality Assurance/Control unit, the Human Service Zone workers can pursue IPV’s when appropriate. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: The Quality Control unit conducts case file reviews to ensure policies and procedures are being properly applied across a monthly statewide caseload sample. The results of this are that areas of training are identified based on commonly occurring errors. iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice: The Quality Control unit conducts case file reviews to ensure policies and procedures are being properly applied across a monthly statewide caseload sample. The results of this are that areas of training are identified based on commonly occurring errors. 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: Training on policy and regular audits are employed to detect and deter intentional violations such as fraud or manipulation of program rules. The results of these activities include better identification of potential IPVs. These activities involve comprehensive reviews and scenario-based training that emphasizes ethical behavior and legal compliance. ii. [x] Unintentional program violations. Describe the activities, the results of these activities, and how they inform better practice: For unintentional violations, which often stem from misunderstandings or mistakes in following program rules, the Lead Agency conducts training sessions that focus on clarity and understanding of policies. The impact of these training sessions is assessed through feedback mechanisms and monitoring of error rates, leading to continuous improvements in training materials and processes. iii. [x] Agency errors. Describe the activities, the results of these activities, and how they inform better practice: Training aimed at reducing agency errors includes detailed instruction on application processing and benefit calculation. Quality Control audits are conducted to identify any patterns of error within the agency’s operations. The results typically inform administrative changes and updates in training programs to enhance accuracy and reduce the occurrence of such errors. Additionally live working sessions are held on a monthly basis to allow workers to ask questions about tricky cases and provide feedback from a program perspective. 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): North Dakota Department of Health and Human Services, Economic Assistance Unit. 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. [ ] 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: When a case or provider is closed and recoupments are not possible, the Lead Agency will pursue entering into a repayment agreement with the client or provider. The repayment plan is set to an amount that the provider or household agrees to pay monthly. There is no minimum requirement needed for a payment plan to be set up. The result of this activity is that repayments are taking place when the system is unable to recoup from active payments. iv. [x] Reduce payments in subsequent months. Describe the activities and the results of these activities based on the most recent analysis: When a case is open and payments are being issued, recoupments will be taken from all future payments until the claim balance is $0. When a provider claim exists, and the provider is receiving payments through CCAP, recoupments will be taken from all future payments until the claim balance is $0. Recoupments are set at 10% unless the claim is established due to an IPV or Fraud, which are recouped at 20% of the payment amount. A household or provider can also choose to have a set amount taken out of their future payments, as long as it is greater than the 10% or 20% previously set up. The results of this are that overpayments are collected from all payments quickly. v. [ ] Recover through State/Territory tax intercepts. Describe the activities and the results of these activities based on the most recent analysis: vi. [ ] Recover through other means. Describe the activities and the results of these activities based on the most recent analysis: vii. [ ] 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: If unable to collect or reach a payment agreement with the household or provider, collection agencies that are contracted through the Lead Agency will be used to recover improper payment. The results is that overpayments are able to be collected if unable to agree on a repayment plan or recoup from payments. 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. [ ] 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. [ ] 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: When a case or provider is closed and recoupments are not possible, the Lead Agency will pursue entering into a repayment agreement with the client or provider. The repayment plan is set to an amount that the provider or household agrees to pay monthly. There is no minimum requirement needed for a payment plan to be set up. The result of this activity is that repayments are taking place when the system is unable to recoup from active payments. iv. [x] Reduce payments in subsequent months. Describe the activities and the results of these activities based on the most recent analysis: When a case is open and payments are being issued, recoupments will be taken from all future payments until the claim balance is $0. When a provider claim exists, and the provider is receiving payments through CCAP, recoupments will be taken from all future payments until the claim balance is $0. Recoupments are set at 10% unless the claim is established due to an IPV or Fraud, which are recouped at 20% of the payment amount. A household or provider can also choose to have a set amount taken out of their future payments, as long as it is greater than the 10% or 20% previously set up. The results of this are that overpayments are collected from all payments quickly. v. [ ] Recover through State/Territory tax intercepts. Describe the activities and the results of these activities based on the most recent analysis: vi. [ ] Recover through other means. Describe the activities and the results of these activities based on the most recent analysis: vii. [ ] 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: If unable to collect or reach a payment agreement with the household or provider, collection agencies that are contracted through the Lead Agency will be used to recover improper payment. The results is that overpayments are able to be collected if unable to agree on a repayment plan or recoup from payments. d. Does the Lead Agency investigate and recover improper payments due to agency errors? [x] No. [ ] 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. [ ] 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. [ ] 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. [ ] Recover through repayment plans. Describe the activities and the results of these activities based on the most recent analysis: iv. [ ] Reduce payments in subsequent months. Describe the activities and the results of these activities based on the most recent analysis: v. [ ] Recover through State/Territory tax intercepts. Describe the activities and the results of these activities based on the most recent analysis: vi. [ ]Recover through other means. Describe the activities and the results of these activities based on the most recent analysis: vii. [ ] 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 human service zone has the burden to establish an Intentional Program Violation (IPV) by clear and convincing evidence. Clear and convincing evidence means evidence that leads to a firm belief that the allegations are true. When there is evidence a possible IPV has been committed, it is suggested the human service zone review the case and all evidence with the supervisor or director. When reviewing the evidence for a possible IPV, the individual must be allowed an opportunity to respond to any unresolved questions. When there is sufficient evidence to substantiate an IPV, the human service zone must complete an SFN 1940 TANF/SNAP/CCAP Notice of Suspected Intentional Program Violation. After completing the SFN 1940, TANF/SNAP/CCAP Notice of Suspected Intentional Program Violation, the county must schedule a meeting with the individual to discuss the suspected Intentional Program Violation (IPV) within two weeks. During this meeting the individual may sign Waiver A of the SFN 1940 which allows the individual to admit to the facts and accept a disqualification period. The individual may also sign Wavier B of the SFN 1940 which allows the individual to accept the disqualification without admitting to the facts. If an individual sign either waiver option, an Administrative Disqualification Hearing (ADH) will not be held and a disqualification period will be imposed. The SFN 1940 and supporting documentation will be supplied to the Lead Agency's Legal Advisory Unit (LAU) and they will prepare a Findings and Order to disqualify the individual. Individuals may also request an administrative disqualification hearing if they do not agree with the IPV. A consolidated hearing will be held for all programs for which the IPV is being pursued. The Lead Agency's LAU will send a Request for an Administrative Law Judge and a copy of the SFN 1940 to the Office of Administrative Hearings (OAH) and a hearing will be scheduled with the individual. When the hearing is complete, OAH will send a Recommended Findings & Order. The LAU will send a copy to the program for review. If the program agrees, the Order will be sent to the Executive Director of the Department. If an individual is found guilty of an IPV, the following timeframes will be imposed: 12 months for the first offense. 24 months for the second offense. Permanently for the third offense. If there are overpayments as a result of the IPV, recoupments will be taken out of all future payments at 20% until the claim balance is $0. If the Lead Agency is unable to recoup from payments, the individual will be contacted to set up a payment plan. 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 human service zone has the burden to establish an Intentional Program Violation (IPV) by clear and convincing evidence. Clear and convincing evidence means evidence that leads to a firm belief that the allegations are true. When there is evidence a possible IPV has been committed, it is suggested the human service zone review the case and all evidence with the supervisor or director. When reviewing the evidence for a possible IPV, the individual must be allowed an opportunity to respond to any unresolved questions. When there is sufficient evidence to substantiate an IPV, the human service zone must complete an SFN 1940 TANF/SNAP/CCAP Notice of Suspected Intentional Program Violation. After completing the SFN 1940, TANF/SNAP/CCAP Notice of Suspected Intentional Program Violation, the county must schedule a meeting with the individual to discuss the suspected Intentional Program Violation (IPV) within two weeks. During this meeting the individual may sign Waiver A of the SFN 1940 which allows the individual to admit to the facts and accept a disqualification period. The individual may also sign Wavier B of the SFN 1940 which allows the individual to accept the disqualification without admitting to the facts. If an individual sign either waiver option, an Administrative Disqualification Hearing (ADH) will not be held and a disqualification period will be imposed. The SFN 1940 and supporting documentation will be supplied to the Lead Agency's Legal Advisory Unit (LAU) and they will prepare a Findings and Order to disqualify the individual. Individuals may also request an administrative disqualification hearing if they do not agree with the IPV. A consolidated hearing will be held for all programs for which the IPV is being pursued. The Lead Agency's LAU will send a Request for an Administrative Law Judge and a copy of the SFN 1940 to the Office of Administrative Hearings (OAH) and a hearing will be scheduled with the individual. When the hearing is complete, OAH will send a Recommended Findings & Order. The LAU will send a copy to the program for review. If the program agrees, the Order will be sent to the Executive Director of the Department. If an individual is found guilty of an IPV, the following timeframes will be imposed: 12 months for the first offense. 24 months for the second offense. Permanently for the third offense. If there are overpayments as a result of the IPV, recoupments will be taken out of all future payments at 20% until the claim balance is $0. If the Lead Agency is unable to recoup from payments, the individual will be contacted to set up a payment plan. iii. [ ] Prosecute criminally. Describe the activities and the results of these activities based on the most recent analysis: 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: