In accordance with the Paperwork Reduction Act of 1995, collection of this information has been approved by the Office of Management and Budget (OMB) under OMB Control Number 0970-0290, expiration date 10-31-2008.  Submission of this information, however, is voluntary.  The public reporting burden for this collection of information is estimated to average 24 hours per response, including the time for reviewing instructions, gathering and maintaining the data needed, and reviewing the collection of information.  An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number.

 Please enter the following information for the individual(s) completing this questionnaire and attachments, so we may contact them to clarify information, if necessary.

Date :                           11/29/05                                                                                                           

Name:              Nancy Crossman                                                                                                          

Title:                 Manager, Division of Human Capital Development                                                         

State Agency:   Illinois Department of Human Services                                                                          

(Area Code) Phone Number:     217-782-1239                                                                                       

E-mail Address:             DHSD4012@dhs.state.il.us                                                                               

Please return the completed questionnaire and attachments in the enclosed business reply envelope.  Alternatively, you may fax your completed questionnaire and brief attachments to the attention of Dennis Poe at 202-205-5887, or preferably email an electronic copy of the questionnaire and any attachments to him at dspoe@acf.hhs.gov.

If you have any questions or comments regarding your submissions, please contact Dennis Poe at 202-401-4053, or at dspoe@acf.hhs.gov. 

Please return the questionnaire and attachments by December 30, 2005.

  1.       How does the TANF Lead Agency define improper payments?

 An improper payment is made when a client does not receive all the benefits they qualify for (underpayment) or they receive more benefits than they qualify for (overpayment).

 

  2.       Provide a description (electronic copy, if available) of the organizational structure of the agency in your State that handles improper payments in the TANF program.  If available, please submit an organizational chart, or provide the web site address where it can be found.

 TANF overpayments are handled by the Bureau of Collections which is in the Office of Fiscal Services.  The Office of Fiscal Services reports to the Chief Financial Officer who reports to the Secretary of the Department.  The web site for our organizational structure is:    http://www.dhs.state.il.us/organization/

 

  3.       Please check all of the topics or activities listed below for which your State has policies or regulations in place for the program. (Please check all that apply.) 

þ   Steps involved in identifying a potential improper payment

þ   Steps involved in verifying an improper payment

þ   Establishing claims for improper payments

þ   Collecting improper payments, including, for example, the authority to reduce payments to recover overpayments

q   Distribution of recovered improper payments

q   Sources of funding for addressing improper payments

q   Other (please specify : )                                                                                              

 

4.       Has your State performed an assessment or analysis to determine whether the program is at risk of improper payments?

q   Yes. 

For which of the following uses of program funds did your state perform an assessment or analysis to determine whether the program is at risk of improper payments? (Please check all that apply.)

q a.  Monthly cash assistance payments

q b.  “Nonassistance” benefits or services, for example, one-time cash payments designed to
divert a family from welfare or payments for car repairs or rental assistance

q c.  Other types of benefits and services for families not receiving cash assistance

q d.  Payments to service providers

q e.  Other (Please specify:) ________________________________________________________
___________________________________________________________________________  

þNo.

 

5.       Please describe your process for identifying and handling improper payments.

Local and central office staff utilize post-payment data sharing and client's statements to identify potential overpayments.  Information is investigated to determine if improper payment was received.  If an overpayment is identified, a receivable is established, the client is notified of the debt, and collection action is initiated.  If the client is receiving benefits, benefit offset is used to recoup the debt.  If the client is not receiving benefits, Private Collection Agencies, the State's Comptroller Offset System, and billing statements are used to recover the debt.

Offset through the Federal Treasure Offset Program (TOP) is not utilized because Federal regulations do not allow offset of the debt from a client's Federal income tax refund.  Although PRWORA contained provisions for the offset of this type of debt, the legislation referenced a non-existent provision of DHHS regulations and therefore cannot be implemented.  Clearly the intent of the legislation was to allow offset from income tax refunds, but due to the incorrect reference, States are unable to implement this provision.  Illinois Department of Human Services in an advocate of recovery of AFDC/TANF overpayments through TOP but it appears DHHS does not want to pursue the necessary legislative changes to 26USC 6402 to allow this type of recovery.  Hundred of millions of dollars nationwide have been lost because of inaction on the use of TOP to collect TANF/AFDC overpayments.

6.       Which methods, if any, did your state use to identify a total amount of improper payments for the program? (Please check all that apply.)

Calculation based on:

q Findings from the state's Single Audit

q Other audit findings from state auditors

q Findings from other state or local auditors, including legislative review entities (Please specify :) ______________________________________________________________________________

q Findings from state or local fraud units (Please specify :) ______________________________________________________________________________

q Reviews of service providers and/or contractors

q Reviews of sampled cases, although not statistically representative of all program payments

q Statistically representative sample of payments

þ Other (Please specify :)

      Total overpayment amount is based on the total of the individual case reported overpayments.

 

7.       Does your State calculate an improper payments (including fraudulent payments) rate, that is, a measure of the percentage of total payments that are determined to be improper? (Please check one response and provide the appropriate data.)

q Yes.  Please describe the methodology used to arrive at the error rate.

þ No 

q Information not available.

 

8.       Please rank the following sources of improper payments (1 to 7) for the program in your State over the past two fiscal years, beginning with one (1) indicating the primary source of improper payments.  Error is defined as an inadvertent mistake whereas fraud is defined as a willful misrepresentation. (Please rank each source below.)

  1   Client error

___ Provider error

 2   Agency error

___ Client fraud

___ Provider fraud

___ Agency fraud

___ Other (Please specify)

Note:  We do not track the number of client errors that are client fraud.  We only have a separation of client and agency errors.  Client errors over the past 2 fiscal years have been 80+% of the errors.

 

9.       Of all improper payments in your State, what proportion of those payments would you estimate are overpayments, and what proportion would you estimate are underpayments?  An overpayment is defined as a payment larger than what should have been made/received or any payment that is received when none should have been received.  An underpayment is defined as a payment smaller than what should have been made/received or no payment was received when there should have been one.

We do not centrally track underpayments.

Overpayments                                 %

Underpayments                               %

 

10.   To what extent, if any, have the following factors contributed to improper payments in your State over the past two fiscal years?  (Please check one answer in each row.)

11.   Please describe your top 3 priorities for preventing and reducing improper payments (e.g., training/meetings for providers on rules and responsibilities; training for agency staff on correct implementation of rules and responsibilities; clear communication with parents on rules and responsibilities; use of information technology.)

1)      Emphasis on training and implementation

2)      Use of information technology

3)      Clear communication with parents

 

13.   Data sharing is a method used to obtain and disclose information about individuals from within your agency, from other agencies and/or from independent, third party sources, including federal and State agencies or private companies.  These activities can be conducted before an initial payment is made to an individual or provider (pre-payment) and also after payment is made (post-payment) to verify eligibility and payment accuracy.   For each source listed below:

Indicate whether or not your agency or State utilizes this data source to better ensure accurate payments under the program.  If your State utilizes the source, indicate when in the process the source is used (before the payment is issued or at some point after the payment is issued), and/or indicate how often that source is used. (Please check all appropriate responses for each row.)

14.   For the most recently completed fiscal years, how much in program improper payments has your agency, or another agency within your State, recovered? (Please indicate your responses in the space provided below.)

Most recently completed fiscal year  $814,694   (Specify ending month/ year)     09/05    

q      Includes fraudulent improper payments   Yes

Next most recently completed fiscal year   $754,747  (Specify ending month/ year)  09/04

q      Includes fraudulent improper payments   Yes

q      Not tracked

 

15.   What penalties does your program mandate for clients, agencies, or providers, who commit an error leading to improper payments?

 A.  Agency:

B.     Clients/Parents:   When computing the amount of overpayment for a client who failed to report earned income, the client is not given the 2/3 earned income deduction.

Also, a 2^nd criminal violation of the Illinois Public Aid Code results in the person being permanently ineligible for cash assistance.

C.     Providers:

D.     County/Local Agency:

 

16.   How does the TANF Lead Agency define “fraud”?

No clear “definition” of fraud in our policy manual; however, in the context of our TANF policies, fraud is a criminal violation of the Public Aid Code.

 

17.   Does your agency maintain data on fraudulent payments in the program as a subset of your improper payments data? (Please check one response.)

q      Yes

If yes, please list the methods you use for finding occurrences of fraud and indicate whether you would rate each method as very effective, somewhat effective, somewhat ineffective, or very ineffective.

q      þ  No 

Does any other entity in your State maintain this information, such as a State fraud unit or Inspector General? If yes, please provide us with a contact name and phone number:

            Yes, Illinois Department of Healthcare and Family Services, Office of Inspector General

                        John C. Allen IV, Acting Inspector General
                        412 North Fifth Street
                        Springfield, IL   62702
                        Phone:   217-785-7030

 

18.   What steps, if any, beyond improper payments prevention, does your State take to specifically prevent fraud? 

Defer to HFS Office of Inspector General

 

19.   Is your agency required to report, or to have information available, on improper payments to the State legislature, the Governor, or any other higher-level agencies? (Please check one response.)

q      Yes ® Please provide a copy of the report(s), and indicate who received them.

q      þ  No

 

20.   Describe any other information that may be relevant to improper payments in the program that you wish to share with us.

 

21.   Please submit copies of pertinent sections of manuals and other State-issued guidance that you would like to make available, or provide the web site address where they can be found.

The web site for our Policy Manual is http://www.dhs.state.il.us/ts/cfsmm/

From that page, click on:  Policy Manual (PM),

                             then:   PM 23: Financial Adjustments and Recovery