9 CCR 2503-5-3.585 - RECOVERY
A. A county
department must take action to research and determine if recovery should be
initiated within ten (10) calendar days of discovering a client received an
overpayment. The recovery of valid overpayments is required regardless of when
the overpayment occurred except in situations as described in Section 3.585.H .
Overpayments may be recovered from the client who was overpaid or who
fraudulently received the assistance payment or another liable individual.
If a client is deceased, overpayments shall be recovered from the deceased client's estate.
B. The following rules do not apply in
instances where the State or county department seeks recovery in a case that
was transferred to the district attorney and prosecuted through the courts:
1. The client shall be notified of the
recovery action to be taken, using the notice rules found at Section 3.554
.C.;
2. When the overpayment is
caused by an unintentional error, the client's willful withholding or an
administrative error, such overpayment shall be deducted, after notice has been
given pursuant to Section 3.554, from subsequent grant payments while the
client is actively receiving Adult Financial grant payments.
a. The client may choose to repay the county
department the entire amount of the overpayment at one time. The client shall
work with the county department to determine how a lump sum repayment can be
made.
b. When the recovery amount
is not to be repaid in a single payment per subsection a above, and the case
remains active, the county department shall establish a monthly recovery
deduction from subsequent assistance payments. The monthly rate of recovery
shall be ten dollars or ten percent of the assistance payment, whichever is
higher.
The following procedure shall be used to arrive at the monthly recovery deduction amount:
1)
If the error is a result of an agency error and the client does not meet
criteria set forth in Section 3.585, compute ten percent (10%) of the Adult
Financial grant payment amount. If the resulting percentage amount is less than
ten dollars ($10), the deduction from the grant payment amount shall be ten
dollars ($10).
2) Deduct the
percentage amount or ten dollars ($10), whichever is higher, from the grant
payment. The result shall be rounded to the next lower whole dollar amount, if
not already a whole dollar amount. This rounded amount is the final payment
amount.
3) When the authorized
payment amount is less than ten dollars ($10), the case is considered a "no
payment" case and no deduction shall be made.
4) When the recovery is due to a fraudulent
action on the part of the client and interest may be added thereto in
accordance with Section 3.584.B.1 ., the interest amount shall not be included
in the grant payment deduction unless the client agrees to such inclusion. If
the client does not so agree, the interest amount shall be collected
separately.
5) The amount of the
grant payment deduction for recovery shall be recorded in the client's case
file and collected via the statewide automated system.
c. The county department shall not establish
a claim unless the amount of the claim is greater than $200, except in the
following circumstances:
1) The overpayment is
identified through a Federal or State level quality control review;
or,
2) The claim is being pursued
as and results in an IPV.
3. When the overpayment is caused by the
client's willful withholding of information or an administrative error, and the
Adult Financial case is no longer active, recovery of such overpayment shall be
based upon the public assistance repayment agreement form or other methods of
recovery.
a. The county shall establish a
monthly repayment agreement with a former client. The repayment agreement shall
not exceed twenty-five percent (25%) of available monthly income. Determination
of the repayment amount must be clearly documented in the electronic case
file.
b. The client may choose to
repay the county department the entire amount of the overpayment at one time.
The client shall work with the county department to determine how a lump sum
repayment can be made.
c. The
county department may write-off unpaid valid claims as follows:
1) Valid administrative error claims less
than one hundred twenty-five dollars ($125.00) can be written off ninety (90)
days after the termination of all public assistance.
2) Valid claims for client error, fraud, and
IPV less than three hundred dollars ($300.00).
3) Any unpaid valid claim of $125 or more for
an individual who was not convicted of an IPV or fraud specific to the
overpayment, is no longer receiving public assistance, and the overpayment was
established six (6) or more years ago, and the county department has determined
that it is no longer cost effective to pursue collection.
d. If the client begins to receive Adult
Financial grant payments again after the overpayment has been established and
still has a claim balance, the deduction of grant payments shall occur as
described in Section 3.585.B .2.
C. The client may issue the State a refund of
any overpaid grant payments from his or her existing balance of Adult Financial
grant payments on his or her Electronic Benefits Transfer (EBT) card by
contacting the county department. This requires a written statement from the
client.
D. Clients are not entitled
to grant payments that were paid in error or mistakenly provided to the client
based on a data entry error into the statewide automated system or an error
resulting from the statewide automated system. The county shall create a claim
and may retrieve the grant payments from the client's EBT card within
twenty-four (24) hours of the issuance without prior written authorization by
the client. The client shall have no appeal rights in relation to this grant
payment because he or she was not eligible for the initial receipt of the grant
payment(s) in the first instance.
When grant payments issued in error are not retrieved from the client's EBT card within twenty-four (24) hours, funds shall not be taken from the card using this method unless permission is granted from the client in writing using the State prescribed form. If permission is not granted, the county department shall pursue other methods of recovery as described in Section 3.585.
E. The
client may request voluntary deductions be applied to the overpayment. These
are considered to be an amount in addition to the deduction from the grant
payment as established through the recovery calculations in Section 3.585.B.
The client shall be provided written confirmation of the amount to be deducted
and that he or she has the right to stop the voluntary deduction at any time by
written request.
F. A claim may be
filed against the estate of a client for overpayment. This includes cases where
overpayments were made and not recovered. The county department's legal advisor
must be consulted in determining the amount of assistance payments for which a
claim is to be filed.
G. In
accordance with Sections
26-2-133 and
39-21-108, C.R.S., the State and
county departments may recover overpayments of public or medical assistance
benefits through the offset (intercept) of a taxpayer's State income tax
refund. Tax refunds shall not be offset in instances where the taxpayer is
making regular, ongoing payments as agreed to in the public assistance
repayment agreement and/or based on arrangements between the taxpayer and the
county(ies). Unless agreed to by the client, the county shall not offset tax
refunds during the same month the client makes a payment on a claim if the
payment agreement was established prior to the offset. Rent rebates are subject
to the offset procedure. The offset of the taxpayer State income tax refund
and/or rent rebate may be used to recover overpayments that have been:
1. Determined by final agency action;
or,
2. Ordered by a court as
restitution; or,
3. Reduced to
judgment.
H. Prior to
certifying the taxpayer's name and other information to the Colorado Department
of Revenue, the Colorado Department of Human Services shall notify the
taxpayer, in writing at his or her last-known address, that the State intends
to use the tax refund offset to recover the overpayment. In addition to the
requirements of Section
26-2-133(2),
C.R.S., the pre-offset notice shall include the name of the county department
claiming the overpayment, the program that made the overpayment, and the
current balance owed.
I. Effective
August 1, 1991, the taxpayer is entitled to object to the offset by filing a
request for a county conference or state level fair hearing within thirty (30)
calendar days from the date that the State Department mails its pre-offset
notice to the taxpayer. In all other respects, the procedures applicable to
such hearings shall be those that are stated in Section 3.587 . At the hearing
on the offset, the county department or ALJ shall not consider whether an
overpayment has occurred because overpayment has already been otherwise legally
established, but may consider the following issues if raised by the taxpayer in
his or her request for a hearing:
1. Whether
the taxpayer was properly notified of the overpayment;
2. Whether the taxpayer is the person, who
owes the overpayment;
3. Whether
the amount of the overpayment has been paid or is incorrect;
4. Whether the debt created by the
overpayment has been discharged through bankruptcy; or,
5. Whether other special circumstances exist
including, but not limited to, the circumstances described in Section 3.585.H,
(i.e., facts that show that the taxpayer was without fault in creating the
overpayment and will incur financial hardship if the income tax refund is
offset).
J. If an offset
is established, an overpayment shall not be recovered using another method
described in Section 3.585 in the month the offset occurs unless prior
authorization is received from the individual making the recovery
payments.
K. The county department
is required to pursue collection of the overpayment from the client/responsible
payee who managed and administered the Adult Financial funds. The county
department shall pursue all available overpayment recovery options to collect
the overpayment from the client/responsible payee first and then any other
liable individuals legally responsible for overpayments, unless otherwise
specified.
1. In instances where a trustee
has used a client's trust income or property in a manner contrary to the terms
of the trust:
a. Determine whether an
overpayment of Adult Financial grant payments has occurred as a result of the
client's loss of income based on the trustee's improper actions;
b. Consult with the county attorney or other
legal resource to determine how to pursue action against a
trust/trustee;
c. Advise the
trustee of the overpayment circumstances; and
d. If the trustee disagrees with such
circumstances and overpayment, pursue the recovery establishment and collection
through appropriate legal means; or
e. Take appropriate steps to secure repayment with the
cooperation of the trustee; or,
f.
Report such behavior or action by the trustee to the county Adult Protective
Services to ensure the protection of the client's rights in the
trust.
2. In instances
where a power of attorney has used his or her legal authority for purposes
other than for the benefit of the client:
a.
Determine whether an overpayment of Adult Financial grant payments has occurred
as a result of the power of attorney's improper actions;
b. Consult with the county attorney or other
legal resource to determine how to pursue action against a power of
attorney;
c. Advise the holder of
the power of attorney of the overpayment circumstances; and,
d. If the holder of the power of attorney
disagrees with such circumstances and overpayment, pursue the recovery
establishment and collection through appropriate legal means; or
e. Take appropriate steps to secure
repayment with the cooperation of the holder of the power of attorney;
or
f. Report such behavior or
action by the trustee to the county Adult Protective Services to ensure the
protection of the client's rights and benefits.
L. In any case in which an overpayment has
been made, there shall be no recovery from any person:
1. Who is without fault in the creation of
the overpayment; and,
2. Who has
reported any increase in income or other circumstances affecting the client's
eligibility within the timely reporting requirements for the program;
and,
3. If such recovery would
deprive the person of income required for ordinary and necessary living
expenses and would be against equity and good conscience. The fact that the
client is receiving public assistance shall not be the only factor in making a
determination that the person would be deprived of income required for ordinary
and necessary living expenses and that equity and good conscience exist.
a. If a client has ten (10) percent or more
of income remaining after necessary living expenses, he or she shall not be
considered deprived of income.
b.
If a client's expenses exceed his or her income, additional questions must be
asked to determine how he or she is meeting expenses to ascertain if other
income (i.e. gift, in-kind) needs to be included in the income
calculation.
M. When the overpayment recovery is not
pursued, such fact, together with the reason, shall be documented in the
statewide automated system. All information pertaining to the reason,
establishment, and collection of claims shall be retained in the case record
until the claim is written off or paid in full.
Notes
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