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SPD Generic program elements

G. Overpayment Recovery

Effective 7/1/11

1. General Information

Expectations. The Department provides overpayment identification and collection services to the extent possible based on the following expectations:

Definition of Overpayment. An overpayment is:

Responsibility for Computing Overpayments. All cash, medical and SNAP overpayments exceeding the overpayment thresholds for SPD clients are to be calculated by an Overpayment Writer in the Office of Payment Accuracy and Recovery (OPAR), Overpayment Writing Unit (OWU). To refer a potential overpayment to OWU, complete an SDS 0284R, attach all needed supporting documentation, and submit to the SPD programs overpayment writer or to the OWU central office by:

Types of Overpayments:

Identifying Overpayments. Overpayment situations are often complicated (for example: Payment for a service goes to a provider while the client receives benefits from the service). Identifying who is responsible for the overpayment is an important part of the process. The overpayment process provides the basis for determining:

Overpayments may be discovered from the following sources:

Definitions and Categories of Overpayments: 461-195-0501

 

2. Establishing and Writing Overpayments

Thresholds for Establishing Overpayments. Narrate all overpayments and use the following thresholds in determining when to refer an overpayment:

For AE overpayments, establish an overpayment in the:

For CE overpayments, establish an overpayment in the:

For PE overpayments, establish an overpayment for cash programs, when the amount is greater than $200.

For PF overpayments, refer all overpayments to the Overpayment Writing Unit, regardless of program or amount. All instances of Possible Fraud overpayments need to be evaluated and completed by an overpayment writer.

The overpayment starts with the first incorrect payment following receipt of possession or income, property, resources or other change in circumstances that caused the overpayment, and ends with the payment in which benefits are corrected or ended.

Overpayments in the Initial Month of Eligibility. Determine the amount of benefits prospectively issued based on income that had been received or expected to be received in the initial month of eligibility.

The Department may establish an overpayment for the initial month (see 461-001-0000) of eligibility under circumstances including but not limited to:

When anticipated income was reported for the initial month of eligibility, and it is later determined that income from another source was not reported but should have been, treat the reported and unreported income as follows in computing the overpayment:

461-195-0501

Overpayments in Months of Ongoing Eligibility. When the client reports the receipt of income or a change in need in the budget month within 10 calendar days, and:

When the client does not report within 10 calendar days that income was received, or a change in need or circumstances occurred within the budget month, and:

Verification and Computation Time Lines. Seek verification of potential income or eligibility discrepancies, when necessary, within 30 working days of first identifying them. Additional steps may need to be taken before discovering if an overpayment of benefits has actually occurred.

Date of discovery of an overpayment is defined as: That date on which an overpayment of benefits, the specific dollar amount, and time period are all confirmed. This is typically only achieved once all evidence, eligibility verifications, earnings, and household composition factors have been confirmed and the appropriate benefit calculations have been run.

CE and PF Procedure. The local office identifies the overpayment and sends the information to the Overpayment Writer (address is on the Overpayment Referral Form SDS 0284R).

Attach pertinent documentation to the referral form such as:

The Overpayment Writer processes the overpayment:

AE Procedure. All AE OVP's above thresholds can be referred to OWU.

*Important–Check for the most current version of all overpayment forms on the DHS Web site Forms Server.*

Recovery and recoupment actions on all client overpayments are initiated by DHS Office of Payment Accuracy and Recovery.

Definitions and Categories of Overpayments: 461-195-0501

 

3. Calculating Dollar Amounts and Completing Overpayments

Provider Overpayments. Provider caused overpayments are calculated by the local branch office and reported to the Provider and Consumer Services Unit. These are provider payments received by Adult Foster Care Providers, Community Based Care Providers, etc. The Provider and Consumer Services Unit will work out a reasonable repayment plan with the provider and a recoupment will occur (similar to a garnishment).

Overpayment Repayment Notice: 461-175-0290

Earned Income Overpayments.

Under-reported earned income: Compute total countable earned income on a month-to-month basis, unless the client had good cause for under-reporting the earned income. For SNAP, do not allow any earnings deductions on the underreported part of the income other than child care costs if those costs would have been deductible under 461-160-0040 and 461-160-0430 and are now verified.

Unreported earned income: Compute total countable earned income on a month-to-month basis, unless the client had good cause for not reporting the earned income. For SNAP, do not allow any earnings deductions on the portion of income not reported other than child care costs if those costs would have been deductible under 461-160-0040 and 461-160-0430 and are now verified.

Reported earned income: When the Department fails to take appropriate action, an administrative overpayment exists. Compute on a month-to-month basis, allowing earnings deductions following policy in effect at the time.

Verifying reports of underreported or unreported earned income: When the branch receives information indicating that the client may have received an overpayment because of underreported or unreported earned income, review the case record to determine if a reporting discrepancy exists. If there is a discrepancy, the worker may request the earnings verification through the following methods:

Once the wage verification is received, the case will be referred to the Overpayment Writer. If the investigator is unable to obtain satisfactory verification, the Overpayment Writer may average the income from the WAGE screen or quarterly earnings report.

Quarterly Employment Department wage match printouts are processed by staff in the Office of Payment Accuracy and Recovery (OPAR), Automation Unit. Overpayments identified from this process are referred to the Overpayment Writing Unit to calculate the overpayment.

461-195-0521

Unearned Income Overpayments. Compute unearned income on a month-by-month basis if it is:

Calculate the overpayment amount as follows. Allow for credits against the amount paid in error. Document credits allowed in the narrative portion of the DHS 0284 or DHS 0284A. Allowable credits are:

Calculation of Overpayments: 461-195-0521

For all programs, include benefits paid during the notice period if:

For all programs use actual unreported income in the month(s) received, for cases where reported income was averaged.

Earned income deductions.

Other Overpayment Calculation Considerations.

Categorical Eligibility, in the SNAP program:

In the SNAP program to comply with the American Recovery and Reinvestment Act of 2009, effective April 1, 2009, through September 30, 2009, the amount between the normal Thrifty Food Plan (TFP) benefit amount under this section and the increased TFP benefit amount under OAR 461-155-0190 is not counted in the overpayment amount unless the filing group was ineligible for SNAP program benefits.
Normal TFP for October 1, 2008 - September 30, 2009


SNAP Payment Standard (TFP)

No. in Need Group

Amount

1

$   176

2

323

3

463

4

588

5

698

6

838

7

926

8

1,058

Each additional individual

132

For medical program overpayments, determine if the client is eligible for another medical program before computing an overpayment. There is no overpayment if the client is eligible for another medical program with the same benefit level during the period in question.  If the client was eligible for another medical program with a lesser benefit level, the overpayment is the amount of medical program benefit payments made on behalf of the client exceeding the amount for which the client was eligible.
In the OSIP and OSIPM programs, when a client does not pay his or her share of the cost of services (see OAR 461-160-0610) or the OSIPM-EPD program participant fee (see OAR 461-160-0800) in the month in which it is due, an overpayment is calculated as follows:

461-195-0521

Processing the Overpayment

  1. Continuation of Benefits pending a Hearing or During Timely Notice Period

When the client reports receipt of income or a change in circumstances within the specified time frames, any benefits provided during the timely continuing benefit decision notice do not become an overpayment.

If a client does not report receipt of income or a change in circumstances within 10 calendar days, the overpayment will include the benefits paid during the timely continuing benefit period.

When benefits issued incorrectly are continued unreduced pending a hearing decision that ultimately supports the department, the additional benefits beyond the initial notice period are an overpayment amount. This additional overpayment is considered a client error. Calculate from the date of the proposed action to the date benefits are reduced or closed as a result of the hearing decision.

If the hearing concerns a proposed action to reduce, suspend or end benefits due to an overpayment that has already been reported via DHS 0284 add the additional overpayment amount via DHS 0284A. If the hearing concerns a proposed action to reduce, suspend or end benefits and no overpayment has yet been completed report the entire overpaid amount via DHS 0284.

When a client’s liability is unreduced pending the outcome of a contested case hearing about that liability the overpayment is the difference between the liability amount determined in the final order and the amount, if any, the client has repaid.

  1. Reporting Overpayments

461-135-0510, 461-135-0550

  1. Liability for Overpayments
    1. In the BCCM, CEC, CEM, EXT, MAA, MAF, OHP, REFM and SAC programs the following individuals are liable for repayment of an overpayment:
      1. Each individual in the filing group or required to be in the filing group and the payee when the overpayment was incurred, except an individual who ---
        1. Was a child or dependent child (see 461-001-0000) at the time of the overpayment; or
        2. Did not reside with and did not know he or she was included in the filing group.
      2. A caretaker relative and his or her spouse who were not part of, but resided with, the filing group when the overpayment was incurred.
      3. A parent or caretaker relative of a child in the filing group and the spouse of the parent or caretaker relative if the parent, caretaker relative, or spouse was a member of or resided with the filing group when the overpayment was incurred.
      4. An authorized representative when the authorized representative gave incorrect or incomplete information or withheld information that resulted in the overpayment.
    2. In the GA, GAM, OSIP, OSIPM, and QMB programs, the following persons are liable for repayment of an overpayment:
      1. Each individual in the filing group or required to be in the filing group and the payee when the overpayment was incurred, except an individual who ---
        1. Was a child or dependent child at the time of the overpayment; or
        2. Did not reside with and did not know he or she was included in the filing group.
      2. A caretaker relative and his or her spouse who were not part of, but resided with, the filing group when the overpayment was incurred.
      3. A parent or caretaker relative of a child in the filing group and the spouse of the parent or caretaker relative if the parent, caretaker relative, or spouse was a member of or resided with the filing group when the overpayment was incurred.
      4. An authorized representative when the authorized representative knowingly gave incorrect or incomplete information or intentionally withheld information that resulted in the overpayment.
    3. In the SNAP program, the following persons are liable for repayment of an overpayment or a claim that results from the trading of a controlled substance (see 461-195-0501(6)):
      1. The primary person (see 461-001-0015) of any age, an ineligible student in the household group, and all adults who were members of or required to be in the filing group (see 461-110-370) when excess benefits were issued.

      • Note: Remember, No member of a financial group is liable for an overpayment caused by a change the group was not required to report.
      • Note: An emancipated minor is an adult under State law and therefore liable. For example, a benefit group consists of an 18-year-old with his 17-year-old wife. The wife became emancipated when she got married and is therefore equally liable for an overpayment as the 18-year-old husband.

      1. A sponsor of a non-citizen household member if the sponsor is at fault.
      2. A drug or alcohol treatment center or residential care facility that acted as the client's authorized representative.
    4. In all programs, both a non-citizen and the sponsor of the non-citizen are liable for an overpayment incurred if the overpayment results from the failure of the sponsor to provide correct information (see 461-145-0820 to 461-145-0840). If the sponsor had good cause (see 461-195-0521(5)) for withholding the information, the sponsor is not liable for the overpayment.

    461-195-0541

Reporting Changes in Client-Liable Overpayments. When changes occur to a client liable overpayment, the information needs to be reported to either the Overpayment Writing Unit (OWU) or the Overpayment Recovery Unit (ORU) within the Office of Payment Accuracy and Recovery as follows:

Report to the Overpayment Writing Unit (OWU) when:

Submit an Overpayment/Overissuance Change form (DHS 284A) to the Overpayment Recovery Unit (ORU) when:

Do not submit a DHS 284A when an overpayment is recovered from:

Notifying the Client of Their Overpayment. For SNAP, medical, GA, or OSIP program overpayments including possible fraud:

 

4. Collecting Client-Liable Overpayments

  1. Collection action is initiated by sending liable persons (see OAR 461-195-0541) notice of overpayment and demand. The demand includes a due date and options for repayment. The Overpayment Recovery Unit (ORU) will allow 10 working days before taking any recovery action. Clients requesting continuation of benefits must make the request within 10 days of the notice date to delay benefit reduction. When the request is made within this time frame, no recovery action is taken until a hearing decision is reached.

    Liable persons receive 30, 60 and 90 day notices requesting them to contact ORU to set up a payment plan. Involuntary recovery may begin 90 days from the date of the initial notice if the client has not requested a hearing.


  2. In addition to the judicial process, the department may recover an overpayment (see OAR 461-195-0501) through an agreed repayment plan, reduction in benefits, voluntary payment from the client or authorized representative (see OAR 461-115-0090), and offset of the debt.
  3. In the GA and OSIP programs, the department may recover an overpayment by reducing cash benefit payments by the lesser of the total overpayment amount, the total benefit amount, or ten percent of the client’s total benefit requirement at the standard of need.
    1. Mandatory  recovery is automated through overpayment system linkage to the CM system.  No recovery can be made if the monthly benefit amount is less than $10. If the amount is $10 or more the computer will enter the overpayment amount on UCMS, enter an OVM Resource code, compute 10 percent of need, round this amount down to the next lowest dollar and enter the amount as the OVM amount. If the benefit amount is less than $10 after the 10 percent mandatory reduction, a check will be issued to the client.
    2. Recovery by reduction in benefits will end when benefits are:
      1. Suspended or ended.
      2. Converted to medical only, where there is no financial eligibility.
    3. The benefit group may voluntarily repay cash program overpayments using cash benefits over and above any mandatory benefit reduction. When benefits are used as repayment, the branch office will complete an Agreement to Take Action form (SDS 0540A) and an Overpayment/Overissuance Change form (DHS 0284A). The branch EBT card issuer must adjust the EBT account accordingly. The client and worker must sign the SDS 0540A or the DHS 284A for the dollar amount.  Send completed forms to ORU.
    4. In the SNAP program, unless the department and the client agree to a repayment plan and the filing group (see OAR 461-110-0370) meets the terms of the plan, the department collects an overpayment from a liable member of a filing group participating in the SNAP program by reducing the food benefits allotment of the benefit group each month as follows:
      1. For an overpayment caused by client error (see OAR 461-195-0501) or administrative error (see OAR 461-195-0501), 10 percent of the group's monthly allotment or $10 a month, whichever is greater.
      2. For an overpayment caused by an IPV (see OAR 461-195-0601), 20 percent of the group's monthly entitlement or $20 a month, whichever is greater.
      3. Recovery by a reduction in benefits will end when benefits are suspended or ended.
      4. The benefit group may voluntarily repay the SNAP program overpayment using SNAP benefits over and above any mandatory benefit reduction. When benefits are used as repayment, the branch office will complete an Agreement to Take Action form (SDS 0540A) and an Overpayment/Overissuance Change form (DHS 0284A). The branch EBT card issuer must adjust the EBT account accordingly. The client and worker must sign the SDS 0540A or the DHS 0284A for the dollar amount. Send completed forms to ORU.
    5. The department may recover an overpayment by offset as follows:
      1. Using the collection services provided by the Department of Revenue and any other state or federal agency to collect a liquidated claim established by:
        1. A court judgement.
        2. A confession of judgment.
        3. A document signed or acknowledged by the debtor that acknowledges the debt, such as:
          • The Department-designated form to acknowledge an IPV.
          • A plea‑bargain agreement.
          • Any other document acknowledging the overpayment.
        4. A written notification of overpayment from the Department to the debtor, advising the debtor of the basis and amount of the overpayment and the right to request a hearing, if the debtor has exhausted his or her rights of administrative appeal.
        5. A written communication from the debtor acknowledging the debt.
      2. Through use of a warrant authorized by ORS 411.703. Upon issuance of the warrant, the department may issue a notice of garnishment in accordance with ORS 18.854.
      3. The amount of any retroactive payment or restoration of lost benefits otherwise payable to the client, when the retroactive payment corrects a prior underpayment of benefits in the program in which the overpayment occurred.
      4. In the SNAP program, by offsetting the full amount of the overpayment against restored benefits owed to the benefit group or to another benefit group that a liable member of the overpaid group has joined.
  4. A confession of judgment is used in the case of a client error (see OAR 461-195-0501) overpayment. The department may not file a confession of judgment while the client receives public assistance and may file one only if the client has refused to agree to or has defaulted on a repayment plan.
  5. When clients are found by a court to be guilty of fraud, the court may order restitution. The department will still initiate recovery actions for the full amount of the overpayment even if:
      1. The court did not order restitution; or
      2. The amount of the restitution ordered is less than the full overpayment amount.
  6. A voluntary agreement to reduce benefits, participation in a voluntary payment plan, or a mandatory reduction does not prevent or preclude recovery from other sources -such as state income tax refund offset.
  7. Overpayments not immediately recoverable will be recovered at a later date, regardless of whether benefits have ended in the interim.
  8. Forward to ORU all correspondence received from a bankruptcy court on a client's or former client's bankruptcy.
  9. Do not attempt to adjust the overpayment balance(s).

461-195-0551

Client entitled to retroactive payment. When a client would be entitled to a retroactive payment, but has an outstanding overpayment balance, credit the retroactive payment amount toward the overpayment by completing a DHS0362 for SNAP (see SNAP Manual G.14 Restoration of Benefits). Contact ORU to determine the outstanding overpayment balance.  Issue to the client only the portion of the retroactive payment that exceeds the overpayment balance.

Change in the payee/benefit group or program. The department will continue to recover the overpayment from the benefit group in which the overpayment occurred, even if there is a change in the payee. If any member of the overpaid benefit group is eligible for and included in another group, recovery will be made from that group's benefits, but only if the recovery is limited to the amount of overpayment incurred when the member actually resided in the household of, or was a member of, the overpaid benefit group.

Receipting Direct Overpayment Reimbursements. The branch must transmit all money it collects to the Department Receipting Unit via DHS 0029 (receipt) system. For direct reimbursements via check, cash, or money order, enter the following receipt codes (for additional receipting codes, see the SSAM):

Note:

 Over-Collection of SNAP Overpayments. If money was collected in error or if the overpayment claim is over-collected, ORU will reimburse the client the over-collected amount. The branch office must reimburse over-collected amounts when benefit reduction caused the over-collection; however, ORU will initiate this action.

Compromise of Overpayment Claims. The Overpayment Recovery Unit (ORU) will consider requests for a compromise on the unsatisfied balance of the overpayment claim. When a client or former client has questions regarding recovery of their overpayment claim, including compromising, refer them to their assigned recovery specialist in ORU.

The Department may consider a request to compromise an overpayment claim only if the estimated administration and collection costs necessary to collect the account in full likely exceed the current balance of the overpayment. The following limitations apply to the compromise of an overpayment claim:

Determining availability of income 461-140-0040
Definitions and Categories of Overpayments 461-195-0501
Establishing overpayments 461-195-0531
Overpayment Recovery 461-195-0551
Compromising Claims 461-195-0561

 

5. Referrals to the Investigations Unit

Role of the Investigator. The investigator conducts investigations as needed to support the operations of the branch office in case management. Results of these investigations are reported to the branch and/or OWU and can result in eligibility determinations, overpayments, Intentional Program Violations and/or referral to a district attorney for criminal prosecution.

Appropriate Referrals to the Department Investigator. The following are examples of referrals that are appropriate for the Department Investigator:

Do not refer routine eligibility matters such as:

Do not ask the Department Investigator to investigate sale of drugs or income from illegal activities. These are police matters.

Reporting the Result of an Investigation. Upon completion of an investigation, the Department Investigator will send a written report (enclosing any documentary evidence obtained) to the branch office/DPU with a copy to the Overpayment Writer and/or the IPV Team if appropriate.

If a case is referred to a district attorney for consideration of prosecution, the branch office/DPU will be notified in writing and will receive a copy of the report to the district attorney when the case has reached its disposition.

If the Investigator has documentary evidence of an IPV and has decided not to refer the case for prosecution, the Investigator will refer the case to the IPV Team for IPV processing.

When the final hearing order is received by the IPV Team, and the claimant is found to have committed an IPV, the case is referred to OWU for initiation of disqualification penalties and collection of the overpayment.

IPV Disqualification Periods

IPV (Intentional Program Violation) Person Disqualification Periods:

1st DQ

=

12 months

2nd DQ

=

24 months

3rd DQ

=

permanently

Additionally, effective 10/96:

For SNAP, when an IPV is established against any person found guilty of:

For SNAP, a person determined by a State Agency or convicted in a Federal or State Court of having given false information about identity or residence in order to receive multiple SNAP benefits simultaneously is disqualified from receiving benefits in the program in which the fraud occurred for 10 years for the first DQ and permanently for the second DQ.

 

Establishing an IPV 461-195-0611
Penalty for IPV 461-195-0621
Recovery by SOIL 461-195-0551

6. Forms

DHS 0029 - General Receipt, to receipt monies received directly from clients or providers.

DHS 0221 - or the SNAP Calc to compute SNAP overpayments.

DHS 0284 - Overpayment/Over issuance Report, to record all overpayments, except child care provider overpayments.

Note: DHS 0284 forms that are marked CE (client error) or PF (possible fraud) are screened for possible referral to the Investigation Unit.

DHS 0284A - to adjust the amount of an overpayment already reported. Do not use this form to submit a new overpayment or to increase an overpayment if the reason to increase is different from the reason for the original overpayment. Submit to OWU within three days of completion.

DHS0284B -Notice of Overpayment and Planned Action, to notify a client or former client of a cash overpayment and their hearings rights. Show the computation of the overpayment on the DHS0284G. Attach a copy of any client notice and the calculation sheets to the DHS 0284 sent to OWU.

DHS 0284M -Notice of Overpayment and Planned Action, to notify a client or former client of a medical program overpayment and their hearings rights. Show the computation of the overpayment on medical overpayment calculation worksheets. Attach a copy of the client notice and the calculation sheets to the DHS0284.

DHS 0284P - Overpayment/Over issuance Report for Provider Payments, to record a claim for a child care provider overpayment.

SDS 0284R – SPD/AAA Overpayment Referral Form, to refer potential client caused overpayments to the Overpayment Writing Unit.

DHS 0284S – Notice of Overpayment and planned action for GA, OSIP, and QMB cases. Complete this notice and attach it and all overpayment calculation sheets to the DHS0284

DHS 0371 - Investigation Referral, to refer a case for investigation to the Investigation Unit.

DHS 0362 - Notice of Restoration of Lost Benefits, when benefits are restored to a client who has been underpaid.

DHS 0649C - Agreement to Waive ADC/Food Stamp Hearing for Intentional Program Violation, when the client agrees that they intentionally violated an eligibility requirement or withheld information.

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Oregon Department of Human Services
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Phone: (503) 945-5811
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