10-144-301 Me. Code R. § 700-FS 777-3

Current through 2024-51, December 18, 2024

Section 144-301-700-FS 777-3 - Claims and Collections

1.COOPERATION IN THE CLAIM ESTABLISHMENT PROCESS:

A household shall be determined ineligible if it refuses, without good cause, to cooperate in any reviews generated by reported changes and recertifications. The household shall be ineligible until it cooperates with the Department.

All subsequent applications or redeterminations shall result in ineligibility for all households that include a member who was an adult member of a household which was determined ineligible as a result of a refusal to cooperate. Good cause provisions apply (e.g. adults separated due to domestic violence, adult child who cannot get a parent's income verification, etc.)

NOTE: Refer to FS 222-1, FS 222-5, pp. 2-4 for further guidance.

2.GENERAL RULE:

A claim may be established against any household that has received more benefits than entitled. There are three classifications of claims:

A.Agency - An overpayment which was the result of a Departmental mistake, or failure to act in a timely manner.

B.Intentional - An overpayment which was the result of a household member intentionally violating a program regulation. This determination must be made by a hearing officer, a court, or a Waiver of Hearing signed by the member.

NOTE: A guilty verdict or a plea of guilty to a criminal charge based on the same conduct that satisfies the criteria for an intentional violation shall suffice to establish such a violation administratively. The amount of the overpayment and corresponding amount due to the Department shall be the amount specified in the letter of debt to the household, irrespective of any Court order of restitution.

C.Inadvertent Household - An overpayment which was the result of a misunderstanding on the part of the household.

NOTE: When determining the amount of the claim for claims established after 10/31/96, do not apply the earned income deduction to that portion of earned income which the household intentionally failed to report; or, which the household failed to report in a timely manner.

NOTE: The Department shall not establish an overpayment when:

A. The Department failed to ensure that a household fulfilled the following procedural requirements:

(1) Sign the application form.

(2) Complete a work referral form.

B. A household was not required to report a change which results in reduced benefits or ineligibility for benefits.

C. The overpayment is caused by agency error or inadvertent household error, has a dollar value of $500 or less, and the household is not participating when the over issuance is calculated.

D. The overpayment is caused by agency error or inadvertent household error, has a dollar value of $200 or less, and the household is participating when the over issuance is calculated.

EXCEPTION: All overpayments resulting from either a Quality Control review or trafficking must be established regardless of the amount or cause. (See definition of trafficking at FS 999-1, pp. 5-6.)

NOTE: In situations where there are overpayments for both State funded benefits and Federally funded benefits, the overpayment attributable to the Federally funded benefits will be collected first.

3.FAIR HEARING REQUESTS:

If a household requests a fair hearing due to an initial demand notice, collection activity is to stop pending the fair hearing decision.

If a hearing officer decides that an overpayment exists against the household, the household must be re-notified of the overpayment and they will not have hearing rights on the same issue.

If the amount of an overpayment was not determined prior to, or with the fair hearing decision, the claimant shall have the right to request a fair hearing on the amount of the overpayment as stated in the re-notification.

4.TIME LIMITS ON DETERMINING CLAIMS:

The Department may determine claims for overpayments for past months, the current month, or months that will be overpaid due to time limits on adverse action. The required time frame is determined by the type of claim.

A.Agency - As far back as 12 calendar months from the month the overpayment was discovered and forward until the benefit amount can be corrected.

B.Intentional - As far back as 72 calendar months from the month the overpayment was discovered and forward until the benefit amount can be corrected.

C.Inadvertent Household - As far back as 24 calendar months from the month the overpayment was discovered and forward until the benefit amount can be corrected.

5.PROMPT RECOVERY OF CLAIMS:

Prompt recovery is required. The Department must initiate action to locate and/or recover the overpayment from a current or former recipient by the end of the quarter following the quarter in which the overpayment is first identified. The required action is determined by the type of claim:

A. For agency error and inadvertent household error claims, the demand letter must be sent.

B. For intentional program violation claims, the letter scheduling the intentional program violation hearing must be sent.

6.COLLECTION PROCEDURES:

A. The Department will determine what the benefit would have been had the household or the Department acted correctly; then, adjust the overpayment by reducing any restored benefits due the household.

NOTE: The calculation must include a separate amount due if the household contains a member who was eighteen years old during only part of the overpayment period. This separation is for collection purposes only.

B. The Department will enter the total claim into the computer system of record.

NOTE: When calculating an overpayment as the result of trafficking, the overpayment will equal the amount of Food Supplement Program benefits involved in the trafficking.

C. The Department will reduce ongoing benefits to recoup the balance of the claim. Unless a higher rate is requested by the household, the following rates shall apply:

(1) For inadvertent household or agency error claims, the reduction amount shall be the greater of ten percent of the monthly benefit, or ten dollars.

(2) For intentional claims, the reduction amount shall be the greater of 20% of the monthly benefit, or $20.00.

D. An appropriate computer generated repayment notice shall be sent. The Department shall make a personal contact with the household, as appropriate.

E. Cases with an outstanding claim that are not currently receiving benefits equal to or in excess of the minimum reduction amount shall be referred to The Benefit Recovery Unit (BRU).

7.ADJUSTMENTS TO THE RECOUPMENT AMOUNT:

A possible compromise of an overpayment shall be assessed and applied when the overpayment is calculated, if eligible. To qualify for compromise of an overpayment, two requirements must be met. If either of these is not met the household will not be eligible for a compromise. The requirements are:

A. An overpayment will be compromised only when caused by agency or inadvertent household error; and B. An overpayment will be compromised only if it is determined that, as of the month of calculation, the household is not now and is not expected to be able to pay back the overpayment within three years (36 months), using the standards set forth below.

(1) The following process will be used to determine eligibility for a compromise. The Department shall-

(a) Confirm the status of the overpayment as caused by agency or inadvertent household error.

(b) Determine the ability to repay the current overpayment balance within 36 months, as follows:

(i) If the household is receiving Food Supplement (FS) benefits:

a) Use the current FS budget as defined in Section FS 555-6 to determine the current benefit amount.

b) Assess which monthly recoupment amount (ten percent of the benefit or ten dollars), is greater.

c) Determine the total recoupment for a 36-month period, by multiplying the greater figure (ten percent or ten dollars) by 36 months.

If the total recoupment for a 36-month period is equal to or greater than the current overpayment balance, there is no potential for a compromise as the overpayment can be paid back in 36 months.

If the total recoupment for a 36-month period is less than the current overpayment balance, the current balance of the overpayment will be reduced to the total recoupment for a 36-month period effective for the month following the month of the compromise calculation.

(ii) If the household is NOT receiving FS benefits:

a) Use the FS budget calculation as defined in Section FS 555-6 to determine the Net Food Supplement Income (NFSI) amount.

Exception: Use of medical expenses greater than $35 per month will not be limited to elderly and disabled individuals.

b) Assess which monthly recoupment amount (three percent of the NFSI or ten dollars) is greater.

c) Determine the total recoupment for a 36-month period by multiplying the greater figure (three percent or ten dollars) by 36 months.

If the total recoupment for a 36-month period is equal to or greater than the current overpayment balance, there is no potential for a compromise, as the overpayment can be paid back in 36 months.

NOTES:

(1) If a household does not qualify for a compromise at the time the overpayment is established they can request a compromise at any time if their circumstances have changed.

(2) A compromise of an overpayment will not be retroactively applied to any period of repayment (on the same overpayment) prior to the month following the month of the compromise calculation.

(3) The calculation to determine possible compromise of an overpayment will be specific to that overpayment. The assessment to determine benefit and NFSI amounts will not factor in any obligation to pay other outstanding Food Supplement overpayments that may exist for the same household.

(4) A compromise of an overpayment will only be applied one time to a specific overpayment. This stipulation in no way limits a recipient from requesting a compromise on another overpayment in the future.

8.SUSPENSION OF COLLECTION ACTIVITIES:

Collection attempts on an inadvertent household claim involving a closed case may be suspended after one demand letter and filed for future reference.

Collection attempts on any agency claim may be suspended after one demand letter and filed for future reference.

BRU may suspend collection attempts on a referred intentional claim involving a closed case after three attempts. When it does, the originating office shall be notified, and the claim shall be filed for future reference.

9.TIME LIMITS ON COLLECTION ACTIVITIES:

Outstanding claims may be terminated by BRU after 36 consecutive months with no collection activity. Outstanding balances on terminated claims regardless of the classification, shall be offset before restoration of lost benefits.

A claim shall be closed when it has been paid in full.

10.RECOVERY METHODS AND PROCEDURES:

Households are encouraged to repay any claim by a lump sum cash payment. The household is not, however, expected to liquidate all of their resources.

If the household is not able to pay the entire amount at one time, it is encouraged to repay through installment payments or allotment reduction. FS may be used as full or partial payment of any installment.

NOTE: Cash repayments shall be made by check or money order payable to Treasurer, State of Maine.

If the household misses a scheduled installment, a notice shall be sent. Renegotiation can be done at any time.

NOTE: Collection action shall be initiated against any or all of the adult members of a household at the time an overpayment occurred. Food Supplement Program recipients responsible for repayment of overpayments are those members of the household at least 18 years of age. A person who attains the age of 18 during the overpaid period is responsible for that portion of the overpayment amount occurring after the attainment of age 18. If a change in household composition occurs, collection action may be pursued against any household which has a member who was an adult member of the household that received the over-issuance. The amount of the initial claim may also be offset against restored benefits owed to the household which contains such a member.

10-144 C.M.R. ch. 301, § 700-FS 777-3

The amended version of this section by filing 2024-209, 9/1/2024 is not yet available.