218 R.I. Code R. 218-RICR-20-00-4.10

Current through November 7, 2024

Section 218-RICR-20-00-4.10 - Improper Payments

4.10.1Underpayments

A. If the household was eligible to receive child care assistance benefits but received a benefit that was less than that which they were entitled, or the failure to issue a benefit for a benefit month in which the household was eligible for such a benefit constitutes an underpayment.

1. The agency representative corrects the underpayment as soon as possible, but not later than thirty (30) days after discovery of the underpayment, to a current recipient or one who would be a current recipient had the error causing the underpayment not occurred.

2. In cases involving an underpayment and an overpayment in the same month, the agency representative must factor in both in determining what the correct payment should have been. If an underpayment still exists, it is promptly corrected.

3. For purposes of determining eligibility and the amount of assistance, a retroactive corrective payment is not considered income, nor is it considered a resource in the month received or in the following month.

4.10.2Overpayments

A. An overpayment occurs when the child care benefit amount paid exceeds the benefit that would have been issued if the payment were calculated correctly based on accurate information that was reported, verified, and acted on in a timely manner.

1. If the agency representative discovers that the household failed to report a change as required by § 4.10 of this Part, and as a result, received child care benefits to which it was not entitled a referral for improper payment is made.

a. If the agency representative determines the improper payment to be caused by the agency or unintentionally caused by the household, the case is referred to the Claims Collections and Recovery Unit (CCRU) for the recovery of the improper payment in accordance with § 4.11 of this Part.

b. If the improper payment is thought to be intentional, the agency representative refers an improper payment claim to the Office of Internal Audits.

2. The Office of Internal Audits establishes whether the improper payment was agency caused, household caused, or fraud and, if the improper payment is deemed fraudulent, OIA refers the case to the Claims Collections and Recovery Unit (CCRU) for recovery of the improper payment in accordance with § 4.11 of this Part.

4.10.3Types of Improper Payments

A. Improper payments may be applied to recipients and/or providers. The cause of each improper payment shall be classified as agency, recipient, or provider caused. Improper payments shall be further classified as unintentional errors or fraud.

1. A recipient improper payment occurs when the child care benefit paid exceeds the benefit that would have been issued if the payment were calculated correctly based on accurate information that was reported, verified, and acted on in a timely manner.

2. A provider based improper payment occurs when a provider receives a duplicate benefit or receives payments for services not rendered.

B. An improper payment shall be classified as an agency error if the error was caused solely by actions taken by the Department or Department staff.

1. Agency errors shall include, but not be limited to the following types of errors:

a. Errors caused by delays in processing applications or taking prompt action on changes that were reported timely;

b. Errors in determining eligibility, the benefit amount or the payment authorization period; data entry errors; and

c. Errors caused by the incorrect application of State Regulations, policy or procedures.

2. Improper payments that are not due to agency error shall be classified as recipient or provider caused. The error shall be classified as both recipient and provider caused if the recipient and the provider both had knowledge and actively participated in the action that caused the improper payment to occur.

a. Improper payments caused by the recipient shall include, but not be limited to, errors caused by reporting false or inaccurate information, and/or delays in reporting changes in household income, resources, circumstances or provider arrangements.

b. Improper payments caused by the provider shall include, but not be limited to, the following types of errors:

(1) Inaccurate reporting of information concerning licensing status, age or other provider eligibility requirements;

(2) Inaccurate reporting of the provider's relationship to the child or the location at which care is given;

(3) Inaccurate reporting of household circumstances;

(4) Committing an illegal act, such as cashing a replacement check after falsely claiming that the original check was lost, stolen or destroyed;

(5) Inaccurate reporting of actual charges, attendance or dates of service; and

(6) Any other false claim for services provided.

3. Either a DHS agency representative, CCRU or OIA FDP shall make a preliminary determination of whether the improper payment was intentional or an unintentional error pursuant to guidelines below.

a. Improper payments shall be classified as intentional if the recipient or provider knowingly withheld or provided false information on matters affecting eligibility, benefits or a claim for services. If a question of fraud exists, the case will be referred by the CCRU or DHS representative to the Office of Internal Audits (OIA) who will investigate the improper payment and, at their discretion, may direct these cases to the State Police and/or to the Office of the Attorney General of Rhode Island for criminal action.

b. An improper payment shall be considered unintentional household error under the following circumstances:

(1) There was clearly no intent to commit fraud or to obtain benefits or payments under false pretenses;

(2) The applicant/recipient or provider did not purposefully withhold or provide erroneous information;

(3) Illness, a family emergency, or any other good-cause reason exists for not reporting information timely or accurately; or

(4) The error was due to a delay in taking action as the result of an administrative hearing request.

4. Procedures for Recovery:

a. Enable a repayment in full settlement (a lump-sum repayment);

b. Enable a repayment agreement between the recipient and CCRU or between the child care provider and the DHS Financial Management Unit.; or

c. Enable a repayment agreement between the CCRU and the child care recipient, using the "Notice of Child Care Overpayment." When a child care improper payment is to be recovered from the recipient, the recipient shall be given notice of that determination using the "Notice of Child Care Overpayment." The notice shall include an explanation of the improper payment determination, including the following:

(1) The amount and period of the improper payment;

(2) The reasons for the improper payment;

(3) The Regulations supporting the improper payment determination;

(4) An explanation of the available methods of repayment;

(5) The recipient's right to appeal; and

(6) A telephone number to call for information about free legal services.

5. Consequences for failure to repay

a. Failure of the child care provider to repay a child care improper payment made by the DHS CCAP and not subject to adjustment by the Department's Financial Office because of provider error, provider fraud, or agency error, shall result in the termination/revocation of the "DHS-CCAP Approved Provider Agreement" and disenrollment from the CPD.

(1) Revocation of the CCAP approved provider status shall continue until further notification.

(2) An appeal may be taken from the denial in accordance with policy.

b. When a licensed child care provider has pled guilty to, has been determined to have committed fraud, or has been convicted of fraud, the OIA shall notify the DHS Child Care and the DHS Licensing Unit in writing of any findings of fraud. Notification is to be made by the Hearing Officer if fraud is found in a hearing, or to be made by the CCRU Unit, if found by the CCRU Unit.

c. The DHS shall retain any improper payment it recovers and shall use the funds for the provision of child care services.

d. Improper payments that are recovered shall be reported to the Agency Director and the Program Administrator.

e. Failure of the child care recipient or provider to repay may result in further legal action, and/or loss of benefits.

4.10.4Administrative Penalties for Intentional Program Violation and/or Fraud

A. Improper payments shall be classified as Intentional Program Violation (IPV) and/or fraud if the applicant/recipient or provider knowingly withheld or provided false information on matters affecting eligibility, benefits or a claim for services. If a question of fraud exists, the case will be referred by the DHS Representative or the CCRU to the Office of Internal Audits (OIA) as outlined in § 10-00-1.6 of this Title.

1. Any person, recipient or provider, who wishes to contest the determination made by the OIA shall be entitled to a hearing as outlined in § 10-00-1.6 of this Title. Those individuals determined to have committed an IPV and/or fraud will be subject to the following consequences:

a. First (1st) offense - disqualification from the CCAP program for a period of three (3) months;

b. Second (2nd) offense - disqualification from the CCAP program for a period of six (6) months; and

c. Third (3rd) and any subsequent offense - disqualification from the CCAP program for a period of twelve (12) months.

B. When OIA determines an IPV, of a recipient or provider, meets the criteria for a criminal investigation, and the case is referred to the State Police and/or to the Office of the Attorney General of Rhode Island no hearing will be held.

1. Those individuals found guilty of fraud in a court of law will be subject to the following consequences, in addition any sentence deemed appropriate by the Court:

a. First (1st) offense - disqualification from the CCAP program for a period of three (3) months;

b. Second (2nd) offense - disqualification from the CCAP program for a period of six (6) months; and

c. Third (3rd) and any subsequent offense - disqualification from the CCAP program for a period of twelve (12) months.

C. Claims for improper payments will also be referred to the CCRU for collection and recoupment.

218 R.I. Code R. 218-RICR-20-00-4.10

Amended effective 6/19/2019
Amended effective 9/2/2021
Amended effective 2/27/2022
Amended effective 4/1/2022
Amended effective 4/23/2022
Amended effective 7/5/2022
Amended effective 9/15/2022
Amended effective 2/9/2023
Amended effective 4/1/2023
Amended effective 2/24/2024
Amended effective 7/29/2024