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Issue Alert - 07-04-05

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Date:

Apr 01, 2007

Program Area:

Child Development Care (CDC)

Issue Summary:

DHS has extended the earliest date they will recover CDC overissuances from 12 months to 72 months

Persons Affected:

CDC recipients and providers who have overissuances

For More Information:

Center for Civil Justice 320 S. Washington, 2nd Floor Saginaw, MI 48607 (989) 755-3120, (800)724-7441 Fax: (989) 755-3558 E-mail: info@ccj-mi.org

Michigan Poverty Law Program 611 Church Street, Suite 4A Ann Arbor, MI 48104-3000 (734) 998-6100 (734) 998-9125 Fax


Background

When a client or provider receives more benefits than they are entitled, DHS may attempt to recoup the money from the client or provider.  Whether or not the client or provider has to repay an “overissuance” depends on the amount of the overissuance, the benefit program, when the overissuance occurred, and the “type” or reason for the overissuance.

 

The three types of overissuances are:

 

Client error overissuances:  This is when a client or providers inadvertently reported incorrect information that resulted in receiving more benefits.  For Family Independence Program (FIP), State Disability Assistance (SDA), Food Assistance Program (FAP) and CDC, the client or provider do not have to pay any money back, if the overissuance was $125 or below.

 

The client error overissuance is calculated from the date of the first payment that resulted in an overissuance OR 72 months prior to the date that DHS discovered the overissuance, whichever is later.

 

Agency error overissuances:  This is when DHS computes the wrong benefit amount or fails to use all the client provided information in calculating the benefit amount or other incorrect agency actions.  For FIP, SDA, FAP and CDC, clients and providers are only responsible for repaying any overissuance if the amount of the overissuance is over $500.

 

The overissuance is calculated from the date of the first payment that resulted in an overissuance OR 12 months prior to the date that DHS discovered the overissuance, whichever is later. 

 

Intentional Program Violation (IPV) or welfare fraud:  This occurs when the client or provider intentionally gives the wrong or misleading information to the agency.  Intent must be proven by clear and convincing evidence.  All overissuances from IPVs are recouped not withstanding the amount.

 

The overissuance period for IPVs begins from the date of the first payment that resulted in an overissuance OR 72 months prior to the date that DHS discovered the overissuance, whichever is later.

 

What's Happening?

Formerly, the Child Development Care (CDC) overissuance period for client or provider errors was the date of the first payment that resulted in an overissuance of benefits OR 12 months prior to the date that DHS discovered the overissuance.

DHS has expanded the CDC client or provider overissuance period.  The overissuance period for CDC overpayments is either the date of the first payment that resulted in an overissuance OR 72 months prior to the date that DHS discovered the overissuance, whichever is later.

What Should Advocates Do?

Advocates should make clients and providers aware of the changes.  Advocates should encourage clients or providers who receive a letter regarding an overissuance from DHS or the Office of Inspector General to seek legal help immediately.

What Should Clients Do?

Clients should be aware of the changes.  If a client or provider receives a letter regarding an overissuance or Intentional Program Violation from either DHS or the Office of Inspector General, he or she should seek legal help immediately.

Finding Help

Most legal aid and legal services offices handle these types of cases, and they do not charge a fee. You can locate various sources of legal and related services, including the free legal aid office that serves your county, at MichiganLegalAid.org. You can also look in the yellow pages under "attorneys" or call the toll-free lawyer referral number, (800) 968-0738.