Fraud Prevention Investigation Program Guidelines

Transcription

1 Fraud Prevention Investigation Program Guidelines Minnesota Department of Human Services Fraud Operations

2 State of Minnesota Department of Human Services Fraud Prevention Investigation Program Guidelines TABLE OF CONTENTS INTRODUCTION... 5 SECTION I BACKGROUND History...8 SECTION II FUNDING AND REIMBURSEMENT Sources of Program Funding FPI Plan and Grant Application Quarterly Settlement Other County Designed Cost Allocation Plan Methodologies...15 SECTION III STAFFING AND DUTIES Mandatory Case Worker-Investigator Distinctions Regional FPI Operations Prohibited Uses of FPI Investigative Staff Investigative Work Hours Supervisory Case Reviews of FPI Investigations Approved Types of FPI Investigative Positions Approved Additional Duties for FPI Positions Investigator Responsibility to Provide Training...24 SECTION IV REFERRAL AND REPORTING PROCEDURES Referral for Investigation Form Referral Standards and Process Inappropriate Referrals Supervisory Review of Referrals Initiation of Investigation Reporting Investigative Findings to the Case Worker Time Requirements for Investigations Prioritizing Referrals Referrals That Cannot be Worked Timely, or sent to a Criminal Investigator

3 4.10 Collateral Case Benefit Terminations Case Actions Based on Investigative Findings Case Worker Reporting Requirements Timely Termination of Public Assistance Cases Use of Recipient Affidavits Benefit Savings on Withdrawn Application or Recertification Benefit Savings When Recipient is Eligible for Another Program Case File Desk Review Process Overpayments, Criminal Investigation, ADH Referrals SECTION V INVESTIGATIONS Requirements and Recommendations for Conducting Investigations Permission to Search Form Investigative Databases Investigation and Interview Practices and Techniques Suggestions for Confirming Information Investigator Safety Interviewing Minors SECTION VI PERFORMANCE EVALUATIONS Purpose and Means of FPI Program Evaluation Cost-Benefit Ratio Performance Standard Timeliness Performance Standard Other Performance Indicators County Program Compliance with Standards Determination of Non-Compliance with Standards Remedying Non-Compliance SECTION VII STATE REPORTING REQUIREMENTS Reporting FPI Activity Mandatory Use of Investigative Data Management Application SECTION VIII DATA PRACTICES Privacy Classifications and Retention of Data Notice of Privacy Practices Information Releases SECTION IX DATA SECURITY ISSUES Data Security/Privacy...74 SECTION X FORMS

4 10.1 Links Fraud Prevention Investigation Plan & Grant Application for County Inter-County Cooperative Agreement Investigation Referral Criteria Interview Checklist...89 APPENDIX Appendix 1 Orientation Document for New FPI Regions Appendix 2 Format for Supervisory Review of FPI Investigative Cases Appendix 3 Differences Between FPI and Criminal Fraud Investigations Appendix 4 FPI County Map

5 FPI Guidelines December 2011 Introduction INTRODUCTION 5

6 FPI Guidelines December 2011 Introduction Minnesota Statute , obligates the Minnesota Department of Human Services (DHS) to develop a Fraud Prevention Investigation (FPI) Program. To the extent of its appropriation, DHS reimburses county human service agency expenditures for the necessary staffing to administer the Program. Although the FPI Program employs a county based investigative structure (investigators are hired and supervised by county staff), operational expectations and standards are defined by DHS and set forth in these Guidelines. Adherence to the Guidelines ensures that comparable procedures and investigative standards are used statewide, that the rights of applicants and recipients are safeguarded, and that the interests of the taxpayer are met through the existence of an easy to use and readily available mechanism for welfare fraud investigations. FPI Program legislation sprang from a confluence of national and local factors: A concern that individuals were coming to Minnesota to fraudulently collect public assistance but the state was not providing sufficient funding to support county agencies in their efforts to reduce fraud. A concern that conducting investigations for the sole purpose of prosecuting recipients is a costly and time consuming process which seldom results in the total recovery of fraudulently obtained assistance. Additionally, the nature of criminal investigation limits the number of cases that can be processed to a handful a year taken from a sea of possible cases. At one time Hennepin and Ramsey counties operated case worker based mobile verification units. These units proved a similar concept as practical and established a successful precedent. Several states developed a focus on fraud prevention, had positive experiences, and helpfully shared the procedural framework and results of their experiments. In creating Minnesota s program, the Department adhered to the philosophy that if prevention can take place before an ineligible applicant receives benefits or if benefits to ineligible recipients are terminated quickly, fewer federal, state, and county tax dollars are misspent. With the advent of federal block grant funding which places a cap on spending, this approach has proven especially valuable in ensuring only eligible recipients draw benefits from the finite pool of program dollars. Minnesota s FPI Program borrowed proven and replicable elements from prevention programs begun in other states during the 1980's, and complemented them with components tailored for success in the Minnesota public assistance environment. The FPI program uses an investigative process requiring cooperation between county agency case workers and investigators. The FPI model is defined by a need for rapid, accurate resolution of investigations and timely termination of benefits to ineligible recipients. It is important to note that the FPI enabling legislation places a cost neutrality requirement on the state s funding appropriation for county agency administrative costs. This requires that demonstrable benefits of the FPI Program outweigh agency administrative costs. More so than many public programs, the FPI program must constantly monitor not only statewide costs and benefits, but also the viability of each county program. The cost neutrality provision requires FPI investigators and managers to be aware of the changing nature of public assistance program administration and adapt when necessary. 6

7 FPI Guidelines December 2011 Section I Background 1.0 SECTION I - BACKGROUND 7

8 FPI Guidelines December 2011 Section I Background 1.1 History In 1981, Orange County, California initiated the first broadly successful program to utilize trained investigators in the detection of fraudulent Aid to Families with Dependent Children (AFDC) and Food Stamp program applications prior to the establishment of eligibility for such assistance. Many states now operate with an investigator based fraud detection component to their public assistance fraud prevention and control plan. In Minnesota during 1990 and 1991, the Department evaluated the effectiveness of investigator based fraud prevention programs in a pilot project involving seven counties. The Department s pilot project experience was consistent with that of other states in that the FPI Program generated sufficient AFDC and Food Stamp program savings to be cost-effective to operate. The success of the pilot project led the Minnesota State legislature to appropriate additional funding which enabled the Department to expand the FPI Program into additional counties in Consistent demonstrations of effectiveness led to additional funding for further expansion in 1995, 1997 and Under present configuration, more than 30 positions are funded to operate FPI programs and dispersed over twenty-five county agencies. Thirteen of those twenty-five agencies act as the lead administrative agency in providing FPI services to multiple counties. All told, more than seventy counties, covering in excess of 90% of the state s public assistance caseload, participate in the FPI Program directly or as participants in a regional operation. The United States Department of Health & Human Services (HHS) conducted an on-site review and evaluation of the FPI Program. As a result of this review, HHS cited Minnesota s FPI Program as a best practices model for other states to follow. The Minnesota FPI program has received recognition with inclusion in the Vice President s Report of the National Performance Review. Specifically, HHS found that:... Minnesota s FPI Program demonstrates effective methods for cutting red tape and empowering employees to get results by developing specific referral criteria, eliminating time-consuming administrative and supervisory procedures, and creating a fraud investigation unit that is capable of handling cases requiring quick resolution. 8

9 FPI Guidelines December 2011 Section I Background 1.1 In addition to TANF and Food Stamp program savings, the Department found in its own operational reviews that the FPI Program helped to: Increase case worker awareness of potentially fraudulent cases Increase claims establishment and disqualifications for intentional program violations (IPV) Increase recipient compliance with voluntary reporting requirements (deterrent effect) Increase confidence in public assistance program administration Greatly expand the number of questionable cases that could be investigated as opposed to more traditional criminal justice oriented investigations Gather statistical data of use in identifying program weaknesses and suggesting policy and legislative changes Realize collateral benefit savings in other federal and state funded programs Correct and update case file information, improving the accuracy of eligibility determinations and thereby lowering quality control error rates Along with these appropriations, the legislature added a cost neutrality provision that requires that public assistance program savings generated from fraud prevention investigations offset county agency administrative costs. This provision serves as the basis for monitoring county agency performance and requiring innovative prevention methodologies and multi-county shared investigator arrangements in order to maintain FPI Program cost-effectiveness. By any measure, the FPI program represents a significant effort toward combating fraud and abuse in public assistance programs. A FPI County Map is included in the appendix to show which counties participate in the FPI program and any regional arrangements existing between counties. 9

10 FPI Guidelines December 2011 Section II Funding and Reimbursement 2.0 SECTION II - FUNDING AND REIMBURSEMENT 10

11 FPI Guidelines December 2011 Section II Funding and Reimbursement 2.1 Sources of Program Funding The Minnesota legislature appropriates funds to the Department for the purpose of reimbursing county agency FPI Program administrative costs. The state appropriation is contingent upon federal financial participation (FFP) from the United States Department of Agriculture, Food and Nutrition Service (FNS); from the United States Department of Health and Human Services Temporary Assistance to Needy Families (TANF) block grant; and from the United States Department of Health and Human Services Health Care Financing Agency. Another state appropriation is also available that partially covers FPI related costs of Child Care Assistance Programs (CCAP) investigations. 11

12 FPI Guidelines December 2011 Section II Funding and Reimbursement 2.2 FPI Plan and Grant Application In order for the Department to secure FFP and limit exposure to potential litigation, county agencies must structure their FPI program operations according to staffing and procedural requirements as set forth in these guidelines. Biennially, all counties must execute an FPI Plan and Grant Application (FPI Plan) (Single County and Cooperative Agreement) with the Department. Once executed, these FPI Plans and amendments serve as the legal basis for departmental approval and funding of county agency FPI program operations. In addition to the grant language contained in the FPI Plan, the Department may also collect information on county agency fraud prevention program operations such as: Position classifications and descriptions of all county agency FPI and criminal investigative staff, and a break out of percentage of time spent on FPI versus other, non- FPI related tasks. County agency organizational charts identifying the location and reporting relationships of the fraud prevention and control staffing within the agency. Copies of all contractual agreements with providers of FPI. Reimbursement of County Expenditures. The Department s Financial Operations Division (FOD) reimburses county agency FPI Program costs using the income maintenance Cost Allocation Plan (CAP) methodology. The FPI Program is considered another cost component of the county agency income maintenance administrative cost pool. However, unlike other income maintenance cost pool centers, the FPI program is excluded from random moment studies and operates under its own federally approved CAP. County agencies must report authorized FPI Program expenditures in whole dollars on page 5 of the paper or electronic version of Income Maintenance Expense Report DHS ENG. Only county agencies with current and fully executed FPI Plans are authorized to claim reimbursement for FPI program expenditures. The Department is only obligated to reimburse FPI costs with state funding up to the non-federal share of the county agency s fiscal year grant. 12

13 FPI Guidelines December 2011 Section II Funding and Reimbursement 2.2 Depending on the type of staff used in their FPI operations, county agencies enter amounts in the following expense categories on page 5 of the Income Maintenance Expense Report, DHS ENG. DHS Bulletin provides detailed instructions for completing this report. FPI staff should not be treated differently than other income maintenance staff in terms of upgrading hardware, software, office supplies, and office space. Under the CAP process, the FPI program is allocated its fair share of county office and support services. The work of FPI staff benefits all aspects of income maintenance program administration. In the first years of the FPI project reimbursement practices required an administratively burdensome manual process of identifying direct and indirect costs. Moving to the CAP based Quarterly Expense Report allows for a standardized FPI cost accounting methodology as directed in the Minnesota County Financial Accounting and Reporting Standards manual. 13

14 FPI Guidelines December 2011 Section II Funding and Reimbursement 2.3 Quarterly Settlement Quarterly settlement of county agency FPI program costs occurs when the Department s Financial Operations Division adds the allocation of qualifying county agency indirect costs to the FPI direct costs reported on page 5 of the Quarterly Expense Report. County Agency FPI employees are treated like case workers in that they are included in the income maintenance administrative cost pool. Employees who work in multiple program areas are allocated their share of a county agency s administrative cost pool in accordance with the Cost Allocation Plan process. On the other hand, agency costs associated with a contract FPI investigative service must be direct charged as there is no administrative allocation covering contracted positions. In either event, the reason that the FPI program is identified separately on the Quarterly Expense Report is for the purpose of calculating the reimbursement shares from the various state and federal funding sources. Allocations between federal and state funding accounts are based on the percentage of completed investigations by each public assistance program component. The Food Support and MA federal matching funds are not identified separately, but rather passed through to the county agency along with all other income maintenance reimbursements. The other funding sources for FPI program reimbursements are coded separately as FPI- TANF, FPI-Child Care and FPI-State when transmitted to the county agency. 14

15 FPI Guidelines December 2011 Section II Funding and Reimbursement 2.4 Other County Designed Cost Allocation Plan Methodologies County agencies that operate their own Financial Operations Division approved Cost Allocation Plan must continue to obtain advance approval of an annual FPI Program grant amount and identify whole dollar (non-allocated) FPI Program costs on their income maintenance report submissions. Some counties have also been authorized to claim expenses under the FPI Expense Prorating method. This allows the county agency to claim 25% of its annual FPI grant every quarter and then reconcile costs against grant reimbursements internally. This method helps address problems associated with inconsistent quarterly reimbursement claim amounts 15

16 FPI Guidelines December 2011 Section III Staffing and Duties 3.0 SECTION III - STAFFING AND DUTIES 16

17 FPI Guidelines December 2011 Section III Staffing and Duties 3.1 Mandatory Case worker-investigator Distinctions There must be a clear distinction between the duties of the case worker and the FPI investigator. Cases referred for investigation under the FPI Guidelines are potentially fraudulent and need to be investigated by trained staff knowledgeable in both investigative procedures and program eligibility regulations. Unlike case workers, investigators are not restricted by federal regulation 7 CFR 273.2(f) which governs prior consent for third party contacts, home visits, data practices limitations on third party contacts, and resolution of discrepancies within households. This is a critical distinction; fraud prevention personnel are investigators and do not make home visits, but in fact, conduct non-custodial interviews of recipients. 17

18 FPI Guidelines December 2011 Section III Staffing and Duties 3.2 Regional FPI Operations Program efficiency demands full time investigators whenever possible, not part time ones. This principle requires grouping counties together until a sufficient caseload size can be balanced against a manageable geographic area. While regional FPI operations are more difficult to manage, the legislatively mandated cost-effectiveness requirement for the FPI program leaves no other choice. The county hosting a FPI regional investigator is in charge of the operation. The host county is expected to make reasonable efforts to accommodate any special needs of the other counties involved, but the host county always has the final decision. DHS has general rules and expectations and evaluates the program on results, but day to day operational control resides with the host agency. For more detailed information see the Orientation Document for New FPI Regions in the appendix. 18

19 FPI Guidelines December 2011 Section III Staffing and Duties 3.3 Prohibited Uses of FPI Investigative Staff Operating FPI programs without clear lines of distinction between eligibility verification procedures and investigative procedures exposes the Department and county agencies to monetary damage lawsuits and court ordered procedural restrictions if the rights of recipients are shown to have been violated. In order to avoid this exposure, the following actions are prohibited with respect to FPI Program staffing: 1. Assigning employees outside the bounds of their non-investigative civil service classification to have them conduct FPI investigations. However, it is allowable to interchange investigative staff between FPI and criminal investigations as long as the county agency funds its share of the position devoted to criminal investigation duties. 2. Combining investigative duties and public assistance program administration duties under the same position. Use of a position which, although including investigation duties in the position description, continues to require the county worker to manage or administer a public assistance caseload violates the prohibition of mixing investigation and eligibility functions. 3. Calculating overpayments identified during fraud prevention investigations. County agencies must not use FPI investigators to calculate overpayments. Calculating overpayments is an inherent part of eligibility determination; that work is not to be funded by assignment to FPI program staff. 19

20 FPI Guidelines December 2011 Section III Staffing and Duties 3.4 Investigative Work Hours Agencies must not arbitrarily restrict investigative work hours. Due to the nature of their job, investigators must have flexibility to schedule their time as necessary to contact recipients and other parties who are not available during traditional work hours. Because investigators are funded strictly for a 40 hour workweek, accommodating these special circumstances for individual cases will require some type of flex time arrangement in order that no additional salary costs are incurred. 20

21 FPI Guidelines December 2011 Section III Staffing and Duties 3.5 Supervisory Case Reviews of FPI Investigations In the appendix is a Sample Format for Supervisory Review of FPI Investigative Cases. Use of the sample format is optional. 21

22 FPI Guidelines December 2011 Section III Staffing and Duties 3.6 Approved Types of FPI Investigative Positions County agency workers who are funded to conduct FPI investigations must be classified as investigators and bear an appropriate position title such as welfare fraud investigator, fraud prevention specialist, eligibility investigator, or eligibility examiner. Included in the job description must be tasks directly related to the investigation of potentially fraudulent public assistance eligibility information. Currently, the following positions meet the staffing requirements of the FPI Guidelines: 1. Welfare Fraud Investigators in Merit System and county agency civil service classifications. 2. Fraud Prevention Specialists in Merit System and county agency civil service classifications. 3. Peace Officers* employed by the county sheriff or city police department. A contract is required between the county agency and the law enforcement office in order to secure FPI funding. 4. Criminal Investigators* assigned to a county attorney's office. A contract is required between the county agency and the county attorney's office in order to secure FPI funding. 5. Private Investigators* who meet licensing requirements pursuant to Minnesota Statutes through A contract is required between the county agency and the private investigation agency in order to secure FPI funding. *In all contractual situations for fraud prevention investigation services, the contracted investigator functions wholly as an employee of the county agency while conducting fraud prevention investigations. 22

23 FPI Guidelines December 2011 Section III Staffing and Duties 3.7 Approved Additional Duties for FPI Positions The Department attempts to fund county agencies at the appropriate full time equivalent (FTE) level in order to maintain cost-effective program operations. These funded positions have a primary responsibility to conduct timely and thorough fraud prevention investigations upon receipt of a referral. However, the number and timing of FPI referrals is not controllable. During limited periods of time it may be necessary for investigators to undertake other duties to sustain a productive level of effort. The following supplementary tasks are consistent with the goals and objectives of the FPI Program: Pursue recipient program disqualifications through the Administrative Disqualification (ADH) process when FPI findings identify intentional program violations. Undertake case file desk reviews as prescribed in Section IV (section 4.17) of the FPI Guidelines. Assist in developing and presenting FPI Program training for case workers and other FPI investigators. Coordinate adjudication of FPI cases with criminal investigations. Compile and track data for FPI reports. Assist DHS staff with special projects. 23

24 FPI Guidelines December 2011 Section III Staffing and Duties 3.8 Investigator Responsibility to Provide Training FPI investigators must provide fraud detection training to county case workers and supervisors to assist them in understanding the FPI process and identifying cases that should be referred. Minimally, investigators should provide annual FPI program training to all case workers and supervisors. It is imperative that newly hired case workers be given training on FPI Program policy and procedures as soon as practical. Investigators need to monitor and evaluate referral rates from financial assistance units and workers to evaluate fraud detection training needs. 24

25 Section IV Referral and Reporting Procedures 4.0 SECTION IV - REFERRAL AND REPORTING PROCEDURES 25

26 Section IV Referral and Reporting Procedures 4.1 Referral for Investigation Form The four-part Fraud Prevention Investigation Referral DHS-3335A-ENG satisfies all FPI procedural and statistical reporting requirements. It consists of: Part A, to request the investigation. Part B, to report the findings of the investigation. Part C, to report public assistance case actions taken by the assistance case worker. Part D, to report and initiate other fraud related outcomes and activities. No other form is authorized for use in generating FPI referrals or reporting actions and results. This ensures that the FPI Program is operated consistently from one county to another, and that all necessary data elements can be compiled for statistical purposes. 26

27 Section IV Referral and Reporting Procedures 4.2 Referral Standards and Process County agencies must ensure that case workers complete Part A of the FPI Referral Form to request an investigation when an application or open case exhibits characteristics of possible fraud. Initiating a referral does not require an absolute certainty of fraud, only an appearance that a misrepresentation, concealment, or withholding of facts is resulting in obtaining or maintaining eligibility for benefits, increasing benefits, or preventing a reduction in the amount of benefits. FPI referrals must be based on questionable eligibility for current program benefits. A referral may occur during: Application; Recertification, or; Whenever a review of case file information indicates household circumstances may not be accurately represented. Often, these reviews occur when the agency learns of possible case file discrepancies from s household change report forms, complaints from citizens or other recipients, other investigations, or state fraud hotline referrals. Referrals involving any of the following program components are considered primary program components for the purpose of prioritizing referrals to investigate: TANF based programs such as MFIP, Diversionary Work Program (DWP), Work Benefit (WB) and Emergency Assistance (EA) Food Support Medical Assistance Child Care Assistance programs: MFIP, transition year, sliding fee, and at-home infant Referrals involving cases with only state funded program components such as General Assistance (GA) and Minnesota Supplemental Aid (MSA) should be made with the understanding they will have a lower investigative priority than referrals with primary program components. See also section 4.8, Prioritizing Referrals. The document FPI Referral Criteria provides a non-inclusive list of examples of case circumstances on which case workers could base a referral. Simply put, referral criteria are based on the premise that potentially fraudulent circumstances exist. Note that some circumstances require referral to a criminal, not FPI, investigator: Closed cases Currently open cases involving historical overpayment issues Child Care provider issues Medical provider issues 27

28 Section IV Referral and Reporting Procedures 4.3 Inappropriate Referrals FPI program staff is not to be used to perform routine verifications of recipient eligibility. For example, IEVS and New Hire matches do not make valid FPI referrals since they involve potential historical overpayments and case workers can make a first attempt to resolve the match through an automated process using MAXIS. However, there are situations where in the judgment of the case worker, an FPI referral could result in the most effective resolution of the specified eligibility issue. What is critical in making FPI referrals is that the eligibility issue in question can be clearly presented in Part A of the FPI Referral Form. As a general rule, referrals that require field investigation, such as those involving household composition or locating assets allow the best use of FPI staff. 28

29 Section IV Referral and Reporting Procedures 4.4 Supervisory Review of Referrals In order to avoid unnecessary delays in the investigative process and assist in the timely completion of investigations, the FPI Referral form must be sent directly to the investigator. If county policy deems it necessary, send a concurrent copy of the referral to the supervisor. Certainly a supervisory review process can occur after the FPI investigative findings have been reported to the case worker. It is the investigator s responsibility to ensure that a referral is valid and, if necessary, return inappropriate referrals to the case worker with an explanation. The success of the FPI program relies on a streamlined referral and investigation process, with minimal administrative procedures and no unnecessary delays. In return, case workers can expect timely completion of investigations with accurate and reliable information. County agencies must ensure that case workers are not restricted from making FPI referrals or from taking case actions as a result of the investigative findings. 29

30 Section IV Referral and Reporting Procedures 4.5 Initiation of Investigation Investigations can only be initiated upon receipt of a completed FPI Referral form from a case worker. At times, information comes to the attention of the investigator that could be used to initiate an FPI referral. In this situation, the investigator should either give the information to the case worker and request that an FPI referral be made, or pre-complete Part A of the referral form and forward it to the case worker for their review and initiation of an investigation. If the case worker can resolve the issue from case file information, cancel the investigation. 30

31 Section IV Referral and Reporting Procedures 4.6 Reporting Investigative Findings to the Case Worker When investigators finish the investigative process, they prepare a Summary of Investigative Findings DHS-3335B-ENG, and complete the FPI Referral form Part B Investigative Findings. These two items are then forwarded directly to the case worker. The investigation completion date is the date the Summary of Findings and Part B are sent or given to the case worker. The Part B section should provide the case worker with a concise summary of any discrepancies discovered. A discrepancy is defined as a departure from case file information as a result of representations (including omissions) on the most recent application, redetermination, or change report form, whether or not the departure causes a change in eligibility or benefit levels. All discrepancies should be shown, whether or not they were listed as an issue in the referral. More than one discrepancy can be recorded on a case. The Summary of Findings is the investigator s report of the results of their investigation. The report must be factual, devoid of opinions, and concisely written so that the case worker can readily draw a conclusion to use as a basis for taking case action. It is important to provide any documentary evidence in support of the reported findings and discrepancies. While the investigator may advise the case worker on what action to take, the case worker maintains ultimate responsibility and authority for determining case actions. County agencies may develop their own computer generated report forms, but in order to maintain FPI program consistency, any county agency investigation report form must bear the title Summary of Findings. 31

32 Section IV Referral and Reporting Procedures 4.7 Time Requirements for Investigations Timely completion of fraud prevention investigations is a principal requirement to ensure that eligibility determinations are not delayed and that savings are quickly realized from the termination, denial, or reduction of program benefits. Investigators are expected to maintain a figure under 15 days as their average number of elapsed days per completed fraud prevention investigation. That average is based on calendar days between the referral date indicated on Part A of the FPI Referral form and the date that the investigator s Part B is returned to the case worker. The calculation includes total days elapsed without regard to work days missed due to weekends, training, holidays, illness, or vacations. It is acceptable for the average to occasionally exceed 15 days during any given month, the performance standard is based on a twelve month average. 32

33 Section IV Referral and Reporting Procedures 4.8 Prioritizing Referrals In every program, as a matter of workload management and to ensure timely eligibility determinations, investigators must prioritize referrals. Furthermore, some programs may not have a staffing level sufficient to meet the completed investigation timeliness requirement if they consider every referral on an equal basis. Investigations should be prioritized bearing in mind that the FPI Program is intended to provide field investigation services on issues that cannot be easily verified through routine verification measures. For example, FPI services are particularly effective with issues involving household composition. After determining that a field investigation would offer the best chance of resolving the issue, prioritization must be made by case status of the referral and program categories as follows: Highest priority -- referrals of new application and emergency assistance cases with at least one of the following primary public assistance program components: TANF funded programs (MFIP, DWP, WB and EA), Food Support, Child Care, or MA. Second priority -- referrals of cases undergoing a recertification and with at least one primary public assistance program component. Third priority -- referrals of open cases with primary public assistance program components but no application/recertification eligibility actions pending. Fourth priority -- referrals of cases that do not contain one of the primary public assistance program components. 33

34 Section IV Referral and Reporting Procedures 4.9 Referrals That Cannot be Worked in a Timely Manner, or Have Been Sent to a Criminal Investigator FPI referrals that cannot be worked timely should be returned to the case worker with the explanation that limited resources do not allow for the assignment of the referral for investigation, and that the worker should pursue resolution of the issue through income maintenance verification procedures. Do not hold or pend these referrals. If appropriate and it is possible to make such an estimate, state when the case may be referred again if the case worker cannot resolve the issue. If a referral falls outside the scope of the FPI program and is referred directly on to a criminal investigator, the FPI Referral form should be returned to the case worker noting in Part D that the case has been referred to a criminal investigator. 34

35 Section IV Referral and Reporting Procedures 4.10 Collateral Case Benefit Terminations During the course of an investigation, possible benefit terminations and reductions may also occur in peripheral or collateral cases not the responsibility of the original referring case worker. In these situations, the investigator needs to complete both Parts A and B of a FPI Referral form and submit their Summary of Findings to these additional, involved case workers. Note in Part A that the referral is based on the identification of discrepant case file information through a collateral investigation. 35

36 Section IV Referral and Reporting Procedures 4.11 Case Actions Based on Investigative Findings The Summary of Findings form also contains check boxes to inform the case worker that specified case closure notice provisions may be applicable or that the case should be referred to a criminal investigator. Note that even if the case is referred to a criminal investigator, the case worker must resolve current eligibility issues and take any necessary case action to reduce, deny, or terminate assistance. One important and necessary aspect of the FPI Program is to identify grant savings when applicants or recipients are not eligible for assistance. Upon receipt of the investigative findings, the case worker must evaluate the information to determine any impact on current eligibility for program benefits. The case worker must then issue notice to reduce or end assistance when facts from the investigation indicate this action. Notice provisions will vary by program. For details see Combined Manual sections: Five Day Notice (MSA and GA) Adequate Notice (all programs but MFIP) Cash Cutoff Notice (MFIP) It then becomes the responsibility of the case worker to record the case action and enter savings information on Part C of the FPI Referral form. This section represents one of the most important reporting components for evaluating the effectiveness of a county agency s FPI Program. When case workers terminate or reduce benefits, they must calculate any FPI program savings. This is accomplished by taking the current month s grant and subtracting the correct grant amount in each of the following program categories: TANF Cash column reflects only the cash portion of the MFIP grant and all other TANF related program savings such as Diversionary Work Program (DWP), Work Benefit (WB) and Emergency Assistance (EA). Food Support column reflects all Food Support program benefit savings and the food portion of MFIP. Medical Assistance column reflects only federal Medical Assistance savings and/or the amount of emergency or retroactive MA claims that are closed or denied. Do not claim savings if there would be eligibility for MA benefits if the recipient applied for them or could be granted extended MA benefits. Other State column includes all other state funded programs savings, such as General Assistance, Minnesota Supplemental Aid (MSA), MSA EA, or any other program. Child Care column identifies Child Care Assistance program savings in MFIP, Transition Year, At Home Infant Care, and Sliding Fee cases. 36

37 Section IV Referral and Reporting Procedures When case workers deny an application, they must also attempt to calculate any FPI program savings. This may be more difficult since obviously there is no current grant amount to use for calculation, but there are program savings and investigators should make every effort to claim appropriate amounts of benefit savings for all investigative efforts. Determining savings may require some reasonable estimating. If the denied application was for medical assistance and there was a request for retroactive medical assistance, be sure to claim the total amount of medical bills the applicant had requested assistance with as well as the ongoing monthly assistance. If benefits in all programs increase or stay the same, check the block titled No Change. If the investigation results in increased benefits enter zero savings. 37

38 Section IV Referral and Reporting Procedures 4.12 Case Worker Reporting Requirements The case worker must sign and date Part C of the referral form, retaining a copy for the case file and sending the original directly to the FPI investigator. The Part C must be completed and returned to the investigator within thirty days of receiving the investigator s Part B. Case workers should rarely fail to return a Part C within thirty days of receipt. One exception might be if the agency knows that a fair hearing has been requested on the proposed case action. In this situation, wait to report the case action and benefit savings until the appeal has been decided. Note, however, that in situations where the investigator discovers an appeal has been requested after case results have already been entered into the Investigative Data Management Application, do not attempt to retrieve and change the Part C. There are so few appeals, and even fewer reversals of agency decisions based on FPI investigations, that the statistical effect does not merit the administrative burden. 38

39 Section IV Referral and Reporting Procedures 4.13 Timely Termination of Public Assistance Cases Do not leave an ineligible case open pending a criminal investigation unless circumstances require the case to remain open to avoid damaging or potentially damaging the criminal case. Base any delay on a specific request from the county attorney s office or criminal investigator. A delay in notification is authorized up to the end of the quarter following the quarter of discovery of the overpayment (Combined Manual 25.24). 39

40 Section IV Referral and Reporting Procedures 4.14 Use of Recipient Affidavits Never allow an affidavit from a recipient to refute investigative findings. Recipient affidavits are made in their self-interest and do not bear the significant evidentiary value of independently corroborated findings obtained through the FPI process. In fact, a new FPI referral should be generated if it appears that the recipient is attempting to misrepresent a change in their circumstances in an effort to maintain eligibility. An investigator can determine if a change has indeed been made. The recipient can always avail themselves of the fair hearing process if necessary. 40

41 Section IV Referral and Reporting Procedures 4.15 Benefit Savings on Withdrawn Application or Recertification Benefit savings should be claimed if an applicant does not follow through on an application for benefits after a fraud prevention investigation was conducted. These savings are considered to be a result of deterring recipients from receiving benefits to which they are not entitled. Savings should be taken even if there were no reported FPI discrepancy findings. 41

42 Section IV Referral and Reporting Procedures 4.16 Benefit Savings When Recipient is Eligible for Another Program In a situation where the investigation results in a termination of a federally based program but eligibility is subsequently established for a state program (GA or MSA), report this event as a termination and record the grant savings in the federal based program category. Agency case actions are reported on the basis of the programs at the time of referral and the changes in eligibility that result from the investigative findings. 42

43 Section IV Referral and Reporting Procedures 4.17 Case File Desk Review Process FPI investigations may develop through a case file desk review process which can help identify cases that should have been referred for a fraud prevention investigation. In addition, they can identify areas of program compliance vulnerability or abuse. During periods of time when there are insufficient FPI referrals for the level of funded FPI staffing, desk reviews shall be performed in lieu of other non-fpi related duties. Note that case worker requests for fraud prevention investigations are always a priority over desk reviews. The desk review process may be initiated upon request from a county agency or at the direction of the Department. Cases subject to the review process must be selected by the Department. Selection is purely random from a group of cases opened, recertified or having a program change within approximately six months of the anticipated month of the desk review. The number of cases selected is dependent on the amount of work the county agency can absorb. The desk review must be an internal review process involving the determination of the accuracy of information contained in the case file. No third party contact is authorized until such time that a case exhibits characteristics of possible or potential fraud and an FPI referral has been initiated. Some examples of allowable review procedures: Comparison of application statements with supporting documentation in the case file. For example, is reported income sufficient to meet known living expenses? Examination of supporting documentation for validity and authenticity. Confirming the accuracy of client statements relative to resource ownership and income by accessing databases such as Department of Natural Resources (DNR), Department of Public Safety, Drivers and Motor Vehicle Records (DMV), Department of Employment and Economic Development (DEED), Department of Labor and Industry/ Workers Compensation, and Credit Bureau. After identifying an inconsistency, the investigator begins an investigation by completing Part A of the FPI Referral Form, noting that the inconsistency was identified through a desk review. The investigator must provide a copy of the completed Part A from the Referral Form to the case worker for enclosure in the case file. At this point the case worker can cancel the investigation if the inconsistency can be resolved from case file information. Upon completion of the investigation, the same procedures for reporting investigative findings and case actions apply. Only case reviews that generate an actual referral for investigation are to be entered into the Investigative Data Management Application. Never enter a case review that does not result in an investigation as a referral into the statistical program. 43

44 Section IV Referral and Reporting Procedures 4.18 Overpayments, Criminal Investigation, and Administrative Disqualification Hearing (ADH) Referrals Other administrative issues and processes arise from the FPI process and are identified in the Other Case Outcomes (Part D) section on the FPI Referral form. As FPI investigations resolve questions of current eligibility, they often reveal information that leads to the assessment of overpayments and discovery of potential intentional program violations (IPV s). County agencies are required to resolve IPV s through either the criminal or ADH process. An IPV is defined as any act by an individual for the purpose of establishing or maintaining eligibility, increasing benefits, or preventing a reduction in the amount of assistance which is intentionally a false or misleading statement or misrepresentation, concealment or withholding of facts or an act intended to mislead, misrepresent, conceal or withhold facts. Whenever an overpayment has been identified, there is an issue as to whether the recipient committed an IPV that resulted in the overpayment. County agencies must use the Part D to record overpayments and to initiate action for resolving potential IPV s through the criminal or ADH processes as follows: Overpayments Record any actual overpayments that have been identified. A claim number is required. It is important that the case worker not delay reporting case action activity just for the purpose of obtaining overpayment information. It is possible for investigative findings to have no impact on current eligibility but still result in identifying overpayments. Therefore, a lack of a negative action is not a bar to reporting overpayments. Criminal Referrals Suspected IPV s that have the potential for meeting the county agency s threshold for criminal prosecution should be referred to a criminal investigator or the county attorney. Either the investigator or case worker can use the D section of the referral form to initiate a criminal referral after the FPI process has been completed County agencies must develop internal guidelines for determining which cases should be resolved through the criminal or ADH process and how the resolution is to be achieved. 44

45 FPI Program Guidelines 2011 December Section IV Referral and Reporting Procedures 4.18 Referrals for Administrative Disqualification Hearings (ADH) The Department understands and supports the role criminal adjudication must play in serious Intentional Program Violations. The ADH process, like the FPI Program, is intended to supplement not supplant traditional methodologies for controlling welfare fraud. In fact, Minnesota Statute requires county agencies to use the ADH process when IPV s have been identified but not pursued through criminal adjudication. The ADH process is not intended as a preliminary step to prosecution. The statute specifies use of the ADH process instead of, not in addition to, prosecution. Barring unforeseeable acts, an election is being made to adjudicate the IPV through the ADH process when an ADH waiver is offered. As the ADH notice states, an ADH will be pursued if the waiver is not signed; there is no indication that prosecution will be a factor or issue. ADH actions are a component in evaluating the effectiveness and cost neutrality of county agency FPI Program operations. Negative case actions coupled with ADH based program disqualification enhances and substantiates benefit savings and cost avoidance and ensures that those recipients who have intentionally violated program rules cannot gain eligibility by merely correcting their household living circumstances. 45

46 Section V Investigations 5.0 SECTION V - INVESTIGATIONS 46

47 Section V Investigations 5.1 Requirements and Recommendations for Conducting Investigations The FPI Guidelines exist as part of the Department s statutory responsibility to promulgate regulations for the FPI process. However, county agencies maintain responsibility for direct supervision of its investigative staff and for ensuring that investigative techniques adhere to United States laws, federal regulations, Minnesota laws, applicable Department rules, county ordinances and applicable court orders. The Department recognizes that specific techniques and resources employed to accomplish FPI program objectives will vary from one investigator to another and from one county agency to another. In this context, this section of the FPI Guidelines provides county agencies with both base line requirements and recommendations for conducting investigations. 47

48 Section V Investigations 5.2 Permission to Search Form The Permission to Search form DHS-3385-ENG was developed for optional use when the recipient allows the investigator to look around their residence for evidence relating to public assistance program eligibility. Generally, these cases involve questions of household composition such as absent parents or existence of children in or out of the household. In these situations, execution of this form demonstrates that the search was voluntary and safeguards the investigator from allegations that a threat of benefit termination was made to gain entrance. A taped recording of the recipient s verbal permission to search is an acceptable substitute for the form. The consent to search form is not necessary when the recipient allows the investigator into the home for the purpose of conducting an interview and no search of the home was intended. 48

49 Section V Investigations 5.3 Investigative Databases FPI staff have online access to several databases. It is appropriate to access these databases whenever there is need to determine the accuracy of public assistance program eligibility information. It is also permissible to use these databases to perform case file desk reviews and to help resolve occasional routine requests from case workers to verify case file information. The following databases are currently available: Department of Natural Resources: provides license information for hunting, recreational vehicles, boats, and snowmobiles Department of Public Safety: provides motor vehicle and drivers license records Department of Economic Security: provides current and historical employment and earnings information Credit Bureau: provides credit histories and social security number verifications Disqualified Recipient Subsystem (DRS): a national database of recipients disqualified from Food Stamps due to intentional program violations MAXIS Medicaid Management Information System (MMIS) Providing Resources to Improve Support in Minnesota (PRISM): Child Support s computer system 49

50 Section V Investigations 5.4 Investigation and Interview Practices and Techniques Investigators should ensure only legally sound investigative procedures are followed when exercising their authority to conduct investigations in order to avoid evidentiary problems. During the course of investigations, investigators should attempt to make contact with the recipient for purposes of an interview. It is up to the investigator's judgment whether to conduct the interview at the outset, during, or at the conclusion of the investigation. In some cases where the questionable eligibility issue may be resolved through third party contacts, it may not be necessary or practical to interview the recipient at all. However, in most instances it is recommended that recipients who are subjects of an investigation be contacted as a matter of thoroughness if nothing else. Perform investigative interviews in a courteous and professional manner. At the onset of any interview with a recipient or witness where personal information is being gathered, investigators must identify themselves by their position title and county agency affiliation and give a written or verbal FPI Data Practices Warning. See section 5.3. If the recipient decides to voluntarily withdraw their application or close an open case take a written statement. Case workers require written statements to close cases or withdraw applications. Also attempt to obtain a written statement from the recipient or witness when an admission causes program ineligibility. Do not merely conduct a simple home visit that does nothing more than restate what the recipient has already reported to the agency. The sample interview worksheet, in the appendix is a best practices example, and was designed by county agency income maintenance staff to help ensure all applicable eligibility issues are addressed during recipient interviews. This interview worksheet is especially helpful for new investigators and those with limited knowledge of public assistance programs. At the conclusion of an investigation it is extremely important to prepare complete and legible reports of investigative findings in grammatically correct, precise, and understandable language. 50

51 Section V Investigations 5.5 Suggestions for Confirming Information The following suggestions for conducting investigations in accordance with FPI Guidelines have been compiled from a number of different sources. Depending on the type of referral, some of the following suggestions may be applicable: a. Use Driver and Vehicle Services (DVS) information to help confirm residence and use driver license photographs to establish identity. b. Confirm the presence of the children in the home. Use sources that confirm actual presence and identity rather than Social Security cards and birth certificates. With the recipient s consent, visually inspect household living and eating arrangements. c. Look for evidence or signs that others may be living in the home and indicate this when reporting findings. d. Confirm whether food is purchased and prepared separately if others reside in the household. e. Confirm name, age and relationship to caretaker of any other persons living in the home. f. Confirm the actual amount of rent paid and who pays for utilities. g. Confirm whether the recipient receives a housing subsidy and if so, list the amount. h. Confirm who actually rents the dwelling and who is listed as an occupant. i. Look for the presence of vehicles that may lead to further information about the recipient s assets or the possibility of others living in the home. If vehicles are seen, perform a motor vehicle check to confirm ownership. j. Ask recipient if they or anyone else residing in the home are employed and, if so, ask where employed, when employment began, number of hours per week, and pay rate. k. Ask about possible assets (checking, savings, boats, etc.) for all recipients on the case. l. Confirm ownership, value, taxes, and physical description of property through property tax records. m. Contact at least two knowledgeable third party sources in an effort to substantiate recipient s statements. n. Confirm whether child support is received. o. When the recipient owns a multiple family dwelling, conduct a visual and physical inspection of the other units in the building. If there are other tenants, interview them to confirm the amount of rent they pay and whether they must also pay their own utilities. 51

52 Section V Investigations 5.6 Investigator Safety County agencies are responsible for ensuring the safety of their investigators. Above all, investigators must protect their personal safety and retreat from any threatening or confrontational situation that may arise. Carry a portable cellular phone for use in an emergency. If you feel your safety is at risk, notify local law enforcement that you are in their jurisdiction and that you may need to contact them. On occasion it may be necessary to have another investigator or law enforcement officer accompany you to the interview site for safety or to serve as a witness. 52

53 Section V Investigations 5.7 Interviewing Minors Do not conduct an interview of a minor child without the consent and presence of a parent or guardian. 53

54 Section VI Performance Evaluation 6.0 SECTION VI PERFORMANCE EVALUATIONS 54

55 Section VI Performance Evaluation 6.1 Purpose and Means of FPI Program Evaluation An essential condition of maintaining funding for the FPI Program is that the program be budget neutral to the state; administrative costs cannot exceed the benefit returned to the taxpayer. Its enabling legislation establishes the need and requirement to set baseline cost-effectiveness standards for purposes of evaluating performance to validate continued funding for county agency FPI program operations. The Department compiles data to determine statewide cost-effectiveness of the FPI Program operations, to examine types and quantity of FPI program activities, and to obtain information necessary for completing individual county program performance reports. Because Department and legislative expectations require the FPI Program to continually prove its cost-effectiveness, performance measurement tools reflect an emphasis on cost-benefit and timeliness of completed investigations. While the statewide cost-effectiveness number determines whether the program has met its legislative mandate, the statewide number is comprised by the efforts of individual programs and investigators. Therefore, each county program is provided with at least an annual assessment of their performance relative to program standards and expectations regarding cost-benefit ratio and investigation processing time. In addition to the two basic measurements, the performance evaluation report may mention other areas of interest or concern that have surfaced with examination of performance data. While the Department recognizes that the FPI Program produces many tangible and intangible benefits outside the realm of pure cost-effectiveness, primary evaluation tools must reflect readily measurable costs and benefits. This is not to be construed as minimizing or overlooking other non-monetary, beneficial aspects of the FPI program. Nevertheless, performance effectiveness is measured by cost-effectiveness and timely resolution of public assistance eligibility issues. 55

56 Section VI Performance Evaluation 6.2 Cost-benefit Ratio Performance Standard Purpose: To measure the pure cost-effectiveness of a FPI program; what is the extent of benefit the taxpayer receives for funding the program? This is the performance standard the Department monitors most closely and upon which it places the highest expectations. The primary purpose of the FPI Program is to reduce the amount of benefits issued to ineligible people at a low cost to taxpayers. Methodology: The cost-benefit ratio is calculated by dividing a program s known financial benefit or return, by the amount of administrative costs. Program costs are the actual administrative cost incurred, not the grant amount. If a program has been awarded a grant of $100,000 but only incurred $ of expenses, the program cost is $78,000. The benefit value used to calculate the cost-benefit ratio is comprised of three separate statistics drawn from the FPI Activity report: Benefit savings (benefits not expended) resulting from case denials, reductions, and terminations. Overpayments identified. Benefit savings (benefits not expended) resulting from ADH waivers and upheld hearing decisions. Note that ADH overpayments are included in the overpayment total. Interpretation: As an example, over a fiscal year time period, a county reports $200,000 in one month benefit savings as a result of negative case actions from FPI investigations. It also identifies $100,000 in overpayments. Additionally, forty-eight ADH waivers were signed and two ADH hearings were resolved in the agency s favor. The county agency s FPI administrative cost reimbursements totaled $150,000. Determining the county s cost-benefit ratio requires some steps before the final ratio calculation can be done. First, because program dollars saved are more important than overpayments identified, some weighting of these two figures is necessary. Accordingly, the reported one month program savings total is multiplied by three to give a three month savings total. In this example, a value of $600,000 is assigned to program savings. Second, for purposes of cost-benefit calculations, the value of a signed ADH waiver or upheld hearing is not the amount of the overpayment, but the amount of savings derived from disqualification. In order to capture a savings benefit amount from a disqualification, a standard savings amount of $1,000 is assigned to each successful ADH waiver or hearing result. This

57 figure is a combination of the benefit value of the single adult standard for MFIP and/or Food Stamps, a six month disqualification period, and an adjustment based on the ratio of MFIP and Food Stamp only cases. Continuing the FPI tradition of avoiding inflating savings benefits, this is a purposefully conservative figure. In this example, ADH savings are credited a value of $50,000 (48 waivers + 2 successful hearings x $1,000). Third, the total amount of financial benefit attributed to FPI efforts is determined by adding the program benefit savings amount ($600,000), identified overpayments ($100,000), and the ADH benefit savings ($50,000). The final step is to divide the total benefit figure of $750,000 by the program cost of $150,000. This results in a positive cost-benefit ratio of $5.00. For every one dollar of administrative costs, the program returns five dollars in overpayments identified or benefits not issued to ineligible recipients. Benchmark performance measure: a $3.00 cost-benefit ratio is the benchmark expectation for basic cost-effectiveness. A corrective action plan is required from any county agency posting a cost-benefit ratio below $2.50. A waiver of the plan may be granted for programs posting a costbenefit ratio between $2.50 and $2.99.

58 Section VI Performance Evaluation 6.3 Timeliness Performance Standard Purpose: To measure the investigator s responsiveness to case worker referrals. This is critical to maintain the basic underlying philosophy of the FPI process -- a speedy resolution of questionable eligibility issues. Methodology: For each completed investigation, the number of days elapsed between the date of referral and the date that the FPI findings are relayed to the case worker is calculated. The average elapsed days per completed investigation is the average number of days it took to complete the investigations in a given report month. See also section 4.7, Time Requirements for Investigation. Interpretation: This figure is automatically calculated by the Investigative Data Management Application. Benchmark performance measure: An average of 15 days or less is required. Using an average elapsed day calculation allows the investigator some flexibility for maintaining the timeliness standards. Completing investigations in less than 15 days allows the investigator to bank those days for more complex investigations. Because it is critical that the duration of an FPI investigation interfere with eligibility determination as little as possible, county agencies exceeding the 15 day standard are required to provide a corrective action plan. 58

59 Section VI Performance Evaluation 6.4 Other Performance Indicators Investigative Caseload Each FPI program is expected to meet a minimum workload requirement expressed as a ratio of completed investigations per month per Full Time Equivalent (FTE) staff position. The FTE figure includes all investigators and any support staff funded for the county program because the rationale for funding non-investigative staff is that they allow more efficient use of investigators. Counties are expected to maintain an average monthly ratio of 25 to 30 completed investigations per funded FTE position. Regional operations, due to greater travel and other logistical demands, have a standard of 20 to 25 completed investigations per FTE. The higher figure would be considered optimal, the lower a minimum level. These numbers are based on historical and current data from Minnesota and other states. Every Minnesota program that consistently meets, and usually substantially exceeds, performance standards operates at these levels of completed casework. The department recognizes that each program has a variety of factors impacting the average investigative workload. Furthermore, it recognizes that quality of work has a bigger impact on performance than quantity. Correspondingly, completed investigations as such are not a primary performance measurement. That said, there is still a demonstrable correlation between the number of investigations completed per FTE and an acceptable cost-benefit performance. Other indicators The Department tracks numerous statistics and measurements. All have significance in some context and may be used as needed to demonstrate program strength and weakness. Some programs may be asked why their performance numbers are significantly above or below statewide averages in particular areas. In cases of above average performance, it is intended that where applicable this information will be shared with other programs on a best practices basis. In cases where performance is noticeably below average, perhaps notice of below average performance can begin a self-evaluation of process and procedures before an official request is made for a corrective action plan to bring the program into compliance. 59

60 Section VI Performance Evaluation 6.5 County Program Compliance with Standards The Department has statutory authority to require program compliance with the procedural guidelines and standards established for the purpose of evaluating whether county agency FPI program operations are cost neutral. 60

61 Section VI Performance Evaluation 6.6 Determination of Non-Compliance with Standards Pursuant to Minnesota Statutes , subd. 4, county agencies are given notice of noncompliance and an opportunity to improve their program performance before sanctions are imposed. The Department has identified reasons for issuing notice of non-compliance for cause: 1. Failure to meet the overall cost-benefit ratio standard. 2. Failure to meet the timeliness standard. 3. Failure to comply with statutes, FPI Guidelines, or the FPI Plan and Grant Agreement. A basis to issue a notice of non-compliance may be identified through various means such as the annual report on FPI program activities, other DHS generated reports, or county agency FPI program operation reviews. 61

62 Section VI Performance Evaluation 6.7 Remedying Non-Compliance Once a basis for cause to issue notice of non-compliance has been identified, the Department will seek county agency compliance through a multi-step process: 1. DHS will send a notification letter to the county outlining the area of potential noncompliance and allow the agency an attempt to refute the non-compliance basis if it feels it has cause to do so. The notification will also contain an offer of technical assistance, including an operational review if requested. 2. If after completing the operational review the Department holds to a finding of noncompliance, the Department will issue formal notice of non-compliance that will detail the specific areas and recommendations for curing the basis for non-compliance. 3. The county agency must submit a corrective plan to the Department within thirty days of receipt of the notice of non-compliance. 4. Failure to submit a corrective plan, failure to cure the area(s) of non-compliance, or failure to be cost-effective can result in any of the following sanctions: Reduction in funded staffing level of FPI positions Billing the county agency for FPI services provided by the Department Reallocation of program grant funds, or investigative resources, or both, to other counties Denial of general funding up to the FPI grant amount for subsequent months of non-compliance 62

63 Section VII State Reporting Requirements 7.0 SECTION VII - STATE REPORTING REQUIREMENTS 63

64 Section VII State Reporting Requirements 7.1 Reporting FPI Activity County agencies are expected to promptly and accurately enter data about their operations into the Investigative Data Management Application (IDM) as reportable events occur referrals received, overpayments calculated, criminal referrals made, negative actions reported, etc. Every month, state staff run a report based on those data entries to provide statewide data about FPI activity. Data is tracked by case and by public assistance program categories so that information can be provided to the involved federal and state oversight agencies that partially fund the FPI Program, and for DHS program evaluation purposes. A time allowance is built into the data administration process to allow activity that has occurred in a particular month to be entered into the IDM application. For instance, the state report capturing FPI activity for the month of January is run during the first week of March allowing county agencies the entire month of February to gather and finalize paperwork for January activities. It is important to note that data entered into the IDM for January activities after the state report is run in March (to continue with the previous example) will not be reflected in the statewide January report. This becomes especially important during key program evaluations periods, most often at the end of the calendar year and the end of the state fiscal year (June 30 th ). In order for programs to receive credit for work done, they must report data in a timely manner. An understanding of the information collected and reported on the Activity Report is critical for a county agency s understanding of the effectiveness of their FPI program operations. The sections of the Activity Report are described below. SECTION I Investigations This section reports the number of referrals received by investigators and the number of completed investigations returned to case workers during the report month. Cases Referred: the number of referrals received by FPI investigators during the report month. Investigations Completed: the number of fully completed investigations (written findings forwarded to the case worker). Investigations Pending: the number of referrals assigned for investigation, but not yet completed. 64

65 Section VII State Reporting Requirements 7.1 SECTION II Investigative Findings This section reports the types of discrepancies found in the investigations which were reported as completed in Section I. Cases with Discrepancies in income, assets, etc: the number of cases with the particular type of discrepancy found by each program category. Cases with No Discrepancies: the number of cases in which an investigation found no discrepancies. SECTION III Reported Case Actions This section summarizes all the case actions proposed or taken by case workers as a result of an investigation. All completed investigations must eventually be accounted for with a corresponding case action of either no change or one of the negative action types. Report totals reflect case actions reported back to the FPI unit during the report month irrespective of the month that the action actually took place. Negative Action Applications: the number of applications for benefits that were denied, reduced or withdrawn as a result of the investigation. Negative Action Open: the number of open or recertification cases which were terminated, withdrawn or reduced as a result of the investigation. Grant Savings: the total dollar amount of one month benefits in cases which have been denied, canceled, terminated, reduced, or withdrawn as a result of the investigation. No Change: the number of all cases, application, recertification, or open, for which case workers have reported that an investigation resulted in no change (or an increase) in benefits. Pending: the number of cases where the investigative findings have been forwarded to the case worker, but the case worker has not returned the Part C with case action information. 65

66 Section VII State Reporting Requirements 7.1 SECTIONS IV, V, and VI These sections summarize agency related case outcomes that occur subsequent to the determination of impact on current benefits. These outcomes include overpayments assessed, criminal referrals, and the results of FPI related pursuit of program disqualification through the ADH process. Report totals reflect actions reported back to the FPI unit during the report month irrespective of the month that the action actually took place. Section IV Overpayments This section reports the number and total dollar amount of overpayments assessed as a result of the investigation findings. In order to enter an overpayment amount into the application the exact amount must have been calculated and a claim number assigned. Estimates of overpayment amounts are not acceptable. Section V Referrals for Criminal Investigations This section reports the number of FPI cases referred for criminal investigation. Section VI ADH This section reports the number and results of cases pursued through the ADH process. The agency must be certain that the overpayments reported in this section have been set up as a claim on Maxis. ADH activities are independent of case action activities and can be reported in any subsequent month without any detrimental effect on the county agency s timeliness requirements. If an agency suspects that a case will be pursued through ADH, then do not enter a close date for the case in the statistical program. 66

67 Section VII State Reporting Requirements 7.1 SECTION VII Average Number of Elapsed Days Per Investigation The Investigative Data Management Application automatically calculates this figure. For all completed investigations reported during the report month, the application calculates the average number of days from referral date to the date the investigator issues a response to the case worker on Part B Investigative Findings. For purposes of computing an average, an investigation is considered to have taken one day if it is completed and a response issued to the worker on the same day as referral. 67

68 Section VII State Reporting Requirements 7.2 Mandatory Use of Investigative Data Management Application County agencies are required to use the Office of the Inspector General s Investigative Data Management Application. 68

69 Section VIII Data Practices 8.0 SECTION VIII - DATA PRACTICES 69

70 Section VIII Data Practices 8.1 Privacy Classifications and Retention of Data Proposed actions to deny, terminate or reduce benefits must be based on information contained in the recipient s public assistance case file. Food Stamp program regulation 7 CFR 273.2(f)(6) requires that documentation be maintained in the recipient case file to support eligibility, ineligibility, and benefit level determinations. Therefore, the county agency must maintain the completed parts of the FPI Referral form and all documentary evidence that supports the conclusions and recommendations in the Summary of Findings in the recipient s case file. The county agency must also maintain a separate file for materials from the FPI investigation such as investigative notes, documents, travel mileage details, and contact logs of telephone and in-person interviews. Maintaining an agency investigative file is important to ensure that certain items are kept confidential during the time an investigation is in active status and civil or criminal judicial actions are pending. The investigative file also serves to document the investigator s work and allow for reimbursement of county agency FPI Program administrative costs. Based on legal review, the Department deems the material contained in the investigation case file, while the investigation is active, to be classified as confidential according to the Minnesota Data Practices Act, Minnesota Statute Subd.3, and would only be disclosed pursuant to discovery requests in administrative hearings or other judicial actions. Completed parts of the FPI Referral given to case workers and maintained in the recipient s case file as the basis for taking case actions are classified as private welfare data pursuant to Minnesota Statute Subd.2. Access to private welfare data can be given to the data subject, government agencies with a legal right to know, and those with whom a proper consent has been given. Once the investigation is completed and all other agency actions including criminal, ADH, or recovery of overpayments have been adjudicated, the FPI investigative case file reverts to private welfare data and is accessible by the recipient or someone to whom the recipient has given informed consent. The Department has established a data retention schedule for FPI Investigative Case Files: 1. Investigative Cases With No Findings retain 1 year after Part C Completion Date 2. Investigative Cases With Findings but no ADH or Criminal referral - retain 3 years after last public assistance case action 3. Investigative Cases Referred to ADH retain 3 years after last public assistance case action 4. Investigative Cases Referred to Criminal retain until after criminal file is destroyed. Refer to County General Records Retention Schedule Sheriff/Law Enforcement: Adult Case 70

71 Section VIII Data Practices 8.2 Notice of Privacy Practices The department has developed a Notice of Privacy Practices [(NPP) DHS-4903A-ENG] to be used when personal information is requested from the subject, typically the applicant or recipient, of a fraud prevention investigation. This form was developed to satisfy the provisions of the federal Health Insurance Portability and Accountability Act (HIPAA) and the Minnesota Government Data Practices Act, Minnesota Statute, Section 13.04, and subd 2. The Department s privacy official has interpreted that the notice requirements only extend to the subjects of investigations, not to witnesses. The elements of a NPP include: Why the data is being collected and how the agency intends to use the data Whether the individual may refuse or is legally required to provide the data What known consequences will result from either providing or refusing to provide the information With whom the collecting agency is authorized by law to share the data There is no requirement to provide a written NPP, oral notice is legally sufficient. However, providing a copy of the NPP to the subject as a matter of practice ensures that an accurate and consistent warning is always given. A key provision of this form notifies the individual that the sole act of refusing to answer questions in an investigation will not affect their benefits. Requiring an individual to cooperate in an investigation as condition of eligibility is viewed as coercive and threatening and circumvents their right against self-incrimination. However, note that failure to provide information required for determining eligibility may result in denial or termination of public assistance benefits. Whether a legally adequate NPP has been given (or given at all) is the most commonly raised issue regarding admission of evidence in fair and administrative disqualification hearings. Use of this form refutes any argument for excluding evidence that is necessary to support county agency program and disqualification actions and limits agency liability for any other recourse allowed under the HIPPA or Data Practices Act. 71

72 Section VIII Data Practices 8.3 Information Releases Minnesota Statutes , subd.3. requires that an individual s application or recertification form include an authorization for release of information. The FPI Release has been incorporated into Department application and recertification forms. The intent of this statutory release was to expedite the gathering of information in fraud prevention investigations. It is a recommended practice for case workers to attach a copy of the FPI Release to the FPI Referral form. In this way, the FPI Release is readily available for the investigator when conducting the investigation. While the FPI Release is broad based, directed at a variety of institutions, the Consent for Release of Information DHS-3386-ENG is directed to a specified third party source of information. The Consent for Release of Information also contains a Tennessen warning and satisfies the requirement for informed consent pursuant to the Minnesota Government Data Practices Act, Minnesota Statute, 13.05, subd. 4. Investigators should understand that they have the authority to request information from third parties without a release. The releases were designed to expedite a third party s release of information when, in the judgment of the third party, they could be liable to the recipient for unauthorized release of information. Most often, third parties do not require that the investigator present a release of information to secure the information requested. 72

73 Section IX Security Issues 9.0 SECTION IX SECURITY ISSUES 73

74 Section VIII Data Practices 9.1 Data Security/Privacy Data Security/Privacy is an issue that must be taken into consideration in every aspect of investigation. While investigators are not limited as to what they can ask, they are restricted in what information they can give out. Each data owner (such as DNR or DEED) defines permissible use of their information; what data is available, how it can be used, and who has access to it. Arrangements between the various entities are based on statute and contractual agreements between data owners, users and the Department of Human Services. How users disseminate information they have obtained is between the user, the user s agency, and the data owner, subject to legal constraints imposed under classifications of protected welfare data and HIPPA data. What constitutes acceptable release of HIPPA and welfare data is under the purview of data practices attorneys and/or county attorneys. As a reference, release of HIPPA and Welfare data to law enforcement is governed by the following State and Federal statutes: Minn. Stat Subds. 1(c) and 2(15) through (19) Federal Stat. Title 7 CFR 272.1(c)[(vi) - (vii)] Federal Stat. Title 45 CFR (f)(2)[9A) (G)] Federal Stat. Title 45 CFR (a)(1)(v) Some data access is based on the user having established a relationship with the data owner. Examples are the agreements users must sign with MAXIS, MMIS II, and PRISM. Each user has mainframe access through the 3270 mainframe emulation. Additional accesses are Department of Employment and Economic Development (DEED), Unemployment Insurance, and Driver and Vehicle Services (DVS). While DHS interfaces with each of these agencies on the user s behalf, access is based on the individual user s written agreement with the specific agency. Permissible use of the data is based on welfare fraud investigations and eligibility issues. Any issues arising from unlawful dissemination of this data to others is between the investigator and the data owners. Misuse may result in civil and criminal liability for the wrongful user of this information and also places access for all users in jeopardy. Authority to access Credit Bureau and DEED quarterly wages and employer information, are specific to the Investigative Data Management Application. This data is based upon State and Federal statutes and user agreements between DHS and the owner of the data. Access to this information is not restricted solely to data on welfare recipients, rather open to all data known to the agency. The rationale for allowing this broad access is that the nature of work done by investigators will lead them to people outside of the welfare system. However, initial access and authority to view this data is based entirely on an investigative need to assist in correct determination of eligibility for public assistance. Release of this information is subject to a need to know basis and not authorized for any other reasons within your organization. Dissemination of this data to outside sources is strictly forbidden. 74

75 Section X Forms 10.0 SECTION X - FORMS 75

76 Section X Forms 10.1 Links: Consent for Release of Information Notice of Privacy Practices Cty PA Investigations Fraud Prevention Investigation Referral Income maintenance expense report, Page 5 Permission to Search Summary of Investigative Findings DHS-3386-ENG DHS-4930A-ENG DHS-3335A-ENG DHS-2550-ENG DHS-3385-ENG DHS-3335B-ENG Other: FPI Plan and Grant Application Region Contract Single County Cooperative FPI Referral Criteria Sample Interview Worksheet 76

77 Section X Forms 10.2 FRAUD PREVENTION INVESTIGATION PLAN AND GRANT APPLICATION FOR COUNTY The following is the Fraud Prevention Investigation (FPI) Plan and Grant Application (FPI Plan) of «County_Lower» County through its «County_Lower» Human Services Department (County Agency) to the State of Minnesota through its Department of Human Services (Department): 1. GENERAL. The purpose of this FPI Plan is to: a. Meet the various requirements of Minnesota Statutes , 119B.02, subd. 5, and , subd. 2 (s) for maintaining, establishing and funding cost effective fraud prevention investigation programs in counties. b. Serve as the legal basis for establishing the organizational and operational structures of County Agency FPI programs as contained in the FPI Program Guidelines (FPI Guidelines) developed by the Department and incorporated into this FPI Plan by reference, hereto. 2. COUNTY AGENCY UNDERTAKINGS. The County Agency commits itself to the following tasks: a. Ensure that its FPI program operations and investigative techniques adhere to the FPI Guidelines, United States laws, federal regulations, Minnesota laws, applicable department rules and county ordinances. b. Conduct fraud prevention investigations in a timely manner as defined in the FPI Guidelines. c. Use staff who qualify as investigators through their personnel classification system or licensed through State of Minnesota POST or private investigator boards. d. Obtain prior approval from the Department for any staffing changes. e. Allow FPI staff to attend and participate in the development and presentation of Department sponsored training and/or other FPI program related workgroups. f. Allow access to and utilization of the Department s Investigative Data Management Application for monitoring, tracking and reporting FPI Program activities and accessing data sources. g. Maintain investigative case files for FPI referrals, which shall contain documentation of contacts made, activities performed, and information obtained. 77

78 Section X Forms 10.2 h. Timely submit narrative, financial and/or statistical reports either as required in FPI Guidelines or as requested by the Department. i. Ensure that financial workers make referrals when appropriate and cooperate with case action reporting requirements. j. Annually, provide training to financial workers in fraud detection to assist them in identifying cases that should be referred. k. Evaluate FPI referral rates among financial workers in order to help identify fraud detection training needs. l. Cooperate with the Department in maintaining cost effective program operations by expanding FPI service coverage to other counties as deemed necessary by the Department. m. Provide short term fraud prevention investigation services to other counties as deemed necessary by the Department. n. When authorized and when workload constraints allow, make use of administrative disqualification hearing process under Minnesota Statute when a completed fraud prevention investigation identifies an intentional program violation and no criminal action is contemplated. 3. REQUIRED COUNTY AGENCY ATTACHMENTS. The county agency agrees to incorporate the following information as an attachment to this FPI Plan when requested: a. County agency organizational chart showing agency management structure and divisions and placement of FPI staff within this structure. b. Position descriptions and personnel classification of funded FPI agency employees including an itemization of all tasks performed and the percentage of time spent on those tasks. c. Where applicable, contractual agreements between county agency and service providers of fraud prevention investigation services. d. Description of policy and procedures for resolving program violations through the administrative disqualification hearing process when a completed fraud prevention investigation identifies a program violation and no criminal action is contemplated. 78

79 Section X Forms GRANT DISBURSEMENT. a. The total value of this grant for all compensation and reimbursements shall be limited to an amount not to exceed «Dollars_Literal» Dollars («Dollars») in each of state fiscal years «M_2010» and «M_2011». b. All disbursements made under this grant are contingent upon demonstrated compliance with operational and reporting requirements established under this FPI Plan. c. County Agency FPI program reimbursements shall be made through the settlement provisions as provided in the Cost Allocation Plan for claiming FPI costs and summarized on the applicable pages of the Quarterly Income Maintenance Administrative Expense Report (Form No. DHS ) or other expenditure reporting formats approved by the Department's Financial Management Division. 5. GRANT COVERAGE, STANDARDS AND CORRECTIVE ACTION. a. All obligations assumed by the county agency, as a condition of qualifying for this grant shall be done in conformance with the approved FPI Plan. Such conformance will be determined by the Department at the sole discretion of its Plan Manager and in accordance with the FPI Guidelines and all applicable federal, state and local laws, ordinances, rules and regulations. b. Failure to comply with the FPI Guidelines or cost effectiveness and timeliness standards developed by the Department may result in loss of administrative reimbursements, reallocation of FPI grant funds and/or investigative resources allowed and directed under Minnesota Statute TERM OF FPI PLAN AND TERMINATION. This FPI Plan shall be effective and cover the time period «Start_Date» through «End_Date», contingent upon the approval of annual operating budgets if needed, submission of attachments, and execution of this FPI Plan and any applicable amendments by authorized representatives of the County Agency and the Department. Funding for county agency FPI program expenditures is based on federal financial participation (FFP) and state appropriations to the Department. If at any time funds from either the federal or state sources become unavailable or insufficient to cover County Agency expenditures, this FPI Plan may be terminated or modified immediately upon written notice of such fact by the Department to the County Agency. The Department may terminate this FPI Plan and the services to be provided without cause upon sixty (60) days written notice to the county agency. In the event of such termination, the county agency shall be entitled to payment for investigation services satisfactorily performed. 79

80 Section X Forms PAYMENT RECOUPMENT. The County Agency must reimburse the Department upon demand or the Department may deduct from future payments under this grant any amounts paid by the Department under this or any previous grant, for which invoices and progress reports have not been received, or for which the County Agency s books, records or other documents are not sufficient to clearly substantiate that those amounts were used by the County Agency to perform services under the FPI Plan. 8. LIABILITY and VENUE. County Agency agrees to indemnify and save and hold the Department, its representatives and employees harmless from any and all claims or causes of action, including all attorney s fees incurred by the Department, arising from the performance of this contract by County Agency or County Agency s agents or employees. This provision shall not be construed to bar any legal remedies County Agency may have for the Department s failure to fulfill its obligations under this FPI Plan. Venue for all legal proceedings arising out of this contract, or breach thereof, shall be in the state or federal court with competent jurisdiction in Ramsey County, Minnesota. 9. PLAN MANAGER. The Department's Plan Manager for the purpose of administering this FPI Plan and the accompanying grant is Dan Neubert or his successor. Such managers have the authority for the acceptance of the county agency's performance, reimbursement or reduction thereof, and compliance with the FPI Guidelines and cost-effectiveness and timeliness standards. 10. ASSIGNMENT. This FPI Plan shall not be assigned, transferred or altered without the prior, written consent of the Department and only if such action comports with the terms of Minnesota Statute Grant funds released hereunder run only to the named County Agency and for the staffing arrangement purposes outlined in this Plan. 11. AMENDMENTS. Any proposed changes to this FPI Plan shall be addressed in amendments and be certified by designated authorities within the county agency to include the county agency director. Any such amendments shall be submitted to the Department for review and be effective only upon written approval by the Plan Manager. Such approval shall only be based on an affirmative finding that the proposed change fulfills the purposes of the FPI Program, federal, state or local law, or ordinances, rules or regulations 12. AUDITS. The books, records, documents and accounting procedures and FPI operating practices of the county agency relevant to this grant shall be subject to examination by the Department, the legislative auditor and auditors representing federal funding agencies such as either the U.S. Departments of Agriculture or Health and Human Services. Records shall be sufficient to reflect all expenses incurred in performance of this grant. 80

81 Section X Forms OWNERSHIPS OF DOCUMENTS. Any reports, studies, photographs, negatives, or other documents prepared by County Agency in the performance of its obligations under this grant shall be the exclusive property of the Department and all such materials shall be remitted promptly to the Department by the county agency upon the Department s request or MN expiration or termination of this grant. County Agency shall not use, willingly allow or cause to have such materials used for any purpose except in conformance with the Minnesota Data Practices Act. 14. DATA PRIVACY. It is expressly agreed that the county agency is a member of or included in the welfare system for purposes of the Minnesota Data Practices Act (Data Practices Act) as a result of this contract. Each party is independently required to comply with the requirements of the Data Practices Act, Medical Records Act, Health Insurance Portability Accountability Act, and federal drug and alcohol treatment regulations. Therefore, both parties agree that neither shall be liable for any violation of any provision of the referenced federal and state privacy regulations indirectly or directly arising out of, resulting from, or in any manner attributable to the actions of the other party. 15. OTHER PROVISIONS - EQUIPMENT. All equipment purchased under this plan must be used for the intended purpose and benefit of FPI program operations. The Department reserves the right to have the equipment transferred back to the Department or to another party named by the Department upon completion or termination of this plan or where its use or lack of use is determined by the Plan Manger to be inconsistent with the purposes of the FPI Program. 81

82 Section X Forms 10.2 IN WITNESS HERETO, the PARTIES have executed this AGREEMENT by their duly authorized officials. APPROVED: COUNTY AGENCY: DEPARTMENT OF HUMAN SERVICES: BY: TITLE: DATE: BY: Commissioner DATE: BY: TITLE: DATE: BY: Division Director DATE: BY: BY: TITLE: DATE: DATE: 82

83 Section X Forms 10.3 COOPERATIVE AGREEMENT FRAUD PREVENTION INVESTIGATION PROGRAM This Agreement by and between State of Minnesota, Department of Human Services, (Department), through its agent County Human Services acting as the Fraud Prevention Investigation (FPI) Regional Administrative Agency (Regional Administrative Agency) and County through its Human Services Department (County Agency). 1. The purpose of this agreement is to: a. Meet the various requirements of Minn. Stat for maintaining, establishing and funding cost effective fraud prevention investigation programs in counties operating under a FPI Regional Plan and Grant Application covering the period July 1, YYYY, through June 30, YYYY. b. Serve as the legal basis for establishing the organizational and operational structures for providing FPI services to counties in a geographical area, hereinafter referred to as FPI regions, in accordance with operational requirements, forms and reporting mechanisms as contained in the FPI Program Guidelines (FPI Guidelines). 2. As a FPI regional participant, the County Agency commits itself to the following: a. Cooperate with the Department and the FPI Regional Administrative agency in fulfilling goals and objectives of the FPI Program pursuant to the FPI Guidelines, United States laws, federal regulations, Minnesota laws, applicable Department rules and county ordinances. b. Cooperate with Regional Administrative Agency in monitoring referrals, completed investigations and case actions taken as a result of fraud prevention investigations. c. Cooperate with the Regional Administrative Agency and the Department in submission of narrative, financial and/or statistical reports either as required in FPI Guidelines or as requested by the Department. d. Ensure that financial workers under its control make FPI referrals to the investigator representing the Regional Administrative Agency, cooperate with case action reporting requirements and participate in funded FPI program related training. e. Make use of administrative disqualification hearing process pursuant to Minnesota Statute when a completed fraud prevention investigation identifies an intentional program violation and no criminal action is contemplated. 83

84 Section X Forms The FPI Regional Administrative Agency commits itself to the following tasks: a. Provide FPI services and reports on FPI Program activity to the County Agency. b. Use qualified investigative staff to provide FPI services. c. Provide training to County Agency financial workers on FPI forms and procedures. d. To the degree authorized and possible given any constraints of workload, assist county agency in the identification and disqualification of individuals through the administrative disqualification hearing process when a completed fraud prevention investigation identifies an intentional program violation and no criminal action is contemplated. 4. is designated as the responsible county agency contact official for ensuring cooperation and coordination with the Regional Administrative Agency in fulfilling FPI program objectives. 5. Funding for the FPI services provided to the count agency is based on federal financial participation (FFP) and a state appropriation for the non-federal share. If at any time funds from either the federal or state sources become unavailable or are reduced, FPI services provided by the administrative agency may also be terminated or reduced. 6. The books, records, documents and accounting procedures and practices of the county agency relevant to the FPI program shall be subject to examination by the Department, the legislative auditor and auditors representing the federal funding agencies. 7. Any reports, studies, photographs, negatives, or other documents prepared by county agency involving regional FPI program operations shall be the exclusive property of the Department and all such materials shall be remitted to the Department by the county agency upon expiration or termination of this agreement. County Agency shall not use, willingly allow or cause to have such materials used for any purpose except in conformance with the Minnesota Data Practices Act. The agency directors or other duly authorized officials execute this agreement intending to be bound hereby: COUNTY HUMAN SERVICES AGENCY: BY: TITLE: REGIONAL ADMINISTRATIVE AGENCY: BY: TITLE: DATE: DATE: _ 84

85 Section X Forms 10.4 INVESTIGATION REFERRAL CRITERIA Program eligibility workers must make FPI referrals to resolve current eligibility issues whenever case file information exhibits characteristics of possible or potential misrepresentation or omission of relevant facts. The criteria and examples of case circumstances which support the criteria have been developed and compiled to aid eligibility workers in their referral decisions. The listing of referral criteria and examples is not intended to be all inclusive. Rather, it is intended to help program eligibility workers identify eligibility related circumstances that warrant referrals. A. Recipient has provided eligibility related documentation which appears altered or forged. Recipient has made verbal or written statements concerning factors of eligibility, which are inconsistent or contradict previous statements or documentation. Examples: a. Landlord statements completed by recipient - owner on Landlord statement does not match the one listed per county property tax records. b. Recipient reports no resources on application, but has no outstanding bills. c. Recipient reports no vehicle, but no reasonable explanation of method of transportation in an area not readily served by public transportation. d. Recipient reports no income for an extended period of time, but offers no reasonable explanation of how needs were met prior to application. e. Recipient reports bank account for children, but not for adults; however, information exists that household expenses were paid by check. f. Employment Services notes excessive application for employment at same company. g. Employment services job logs appear to be falsified. B. In cases where one of the parents is reportedly absent from the home. 1. A new child by the same absent parent is added. 2. There are reported frequent visitations by the absent parent, but recipient reports no known address for the absent parent. Examples: a. Recipient refuses to provide shelter verifications; indication that absent parent may be in home. b. Complaints of absent parent in home. Recipient states absent parent not living there and signs an affidavit. County agency continues to receive complaints that absent parent is in the home. c. Other adult answering phone calls could signify possible return of absent parent. 85

86 Section X Forms 10.4 C. It is suspected the Recipient no longer lives in area or has separate living and mailing addresses. Examples: a. Recipient is often out of town and receives agency mail late. b. Recipient often calls at end of month to see if benefits are in EBT account. c. Recipient known to complete landlord statements for other recipients. d. Numerous benefits going to the same address. e. Recipient moves to Minnesota from another state, but does not require damage deposit or rent to get into an apartment. f. County agency initiated mail is returned, but benefits are received. g. Online message to case worker that EBT benefits have not been accessed and no move reported to agency. h. EBT benefits frequently accessed out of state. D. Possible unreported income household living expenses, such as rent and utilities equal or exceed reported income. Examples: a. Rent and utilities are close to, or over grant amount, but recipient never reports income of any kind. b. Emergency assistance - rental property not being utilized, utility bills in another person s name. Recipient wants county agency to pay utility bills for entire duplex that it never rents out. c. Rent and utilities exceed benefit amount. Each month a statement is provided that someone is loaning the recipient the additional amounts needed. d. Repeated telephone calls, but recipient is never home. e. Repeated telephone calls, no small children in home yet always hear small children in background when you call. f. Recipient can only come to an appointment before 8 a.m. or after 4 p.m. g. Recipient comes into office in readily identifiable work clothes or uniforms, but hasn't reported earnings. h. Recipient consistently turns in forms late, yet is never concerned that benefits are late. i. Employment Services sanction, reduced grant and no apparent hardship on household financial circumstances, no attempt to correct sanction. j. Frequent changes occurring in household composition. 86

87 Section X Forms Repeated changes of caretaker, e.g. from parent, to aunt, to grandparent, to another parent. 2. A history of previous unreported changes. Examples: a. Children frequently in and out of the home and not reported. b. Shared custody cases. c. Case was previously closed for loss of contact or failure to provide essential information. d. Case was previously referred for investigation and issues never resolved. e. A record of statements about the composition of the household which are later found to be false. Examples: a. Applying for children who are not in the state; notification from another state that children are on assistance there. a. Information received that children are not in the home. b. Frequently moves, uses of relative s addresses or P.O. Box only; location of children during these frequent moves. 4. Providing inconsistent information pertaining to such things as social security number, birth dates, family relationship. Examples: a. Recipient names the absent parent for a child, later names someone else as the parent. b. Recipient appears to be deceptive when providing identifications. c. Recipient has same boyfriend during conception and after birth of child. E. Recipient has provided eligibility related documents which appears altered or forged. Recipient has made verbal or written statements concerning factors of eligibility, which are inconsistent or contradict previous statements or documents. Examples: a. Landlord statements completed by recipient owner on Landlord statement does not match the one listed per county property tax records b. Recipient reports no resources on application, but has no outstanding bills. c. Recipient reports no vehicle, but no reasonable explanation of method of transportation in an area not readily serviced by public transportation. d. Recipient reports no income for an extended period of time, but offers no reasonable explanation of how needs were met prior to application. e. Recipient reports bank account for children, but not for adults; however, information exists that household expenses were paid by check.. 87

88 Section X Forms 10.4 f. Employment Services notes excessive application for employment at same company. g. Employment Services job logs appear to be falsified. F. Changes in household circumstances which appear to have occurred or to have been unreported in order to remain eligible for benefits. Examples: a. Unemployed parent in home gains employment, then recipient reports that unemployed parent left household so that benefits are not canceled or reduced. b. Recipient notified of Employment Services sanction. Recipient then reports that sanctioned person is no longer in household. c. Minor caretaker reports moving out of parental home and in with another relative so that she can get her own benefits. d. History of recipient working until county agency becomes aware of employment. At that time recipient reports termination of employment. e. Recipient with seasonal employment fails to report returning to work when appropriate season arrives. f. Recipient s unemployment benefit terminates, but continues to be unemployed. g. Food Support household includes person who is not on cash assistance. This person has income resulting in reduced Food Support benefits. Upon notification of reduction, recipient reports person has left household. G. Discrepancies in Employment Services information and income maintenance files. Examples: a. Recipient reports more work hours to employment s services than to income maintenance. b. Employment Services provider notes frequent application for employment for same company. 88

89 Section X Forms 10.5 INTERVIEW CHECKLIST Case Information Public Assistance Case Number Case Name Applicant Recipient Address: Programs: Cash Amt $ FS Amt $ Household Composition Name DOB Relationship Employment Earned Income Is anyone in the household employed? Yes No Name Name Employer Employer Address Address Name Name Employer Employer Address Address When did employment begin? How many hours per week? When was the first paycheck received? Gross Hourly Wage: 89

90 Section X Forms 10.5 Self Employment Is anyone in the household self-employed? Yes No Name Nature of work Start Date How did you fund starting the business? Amount of Gross and Net income Does anyone own property for use in self-employment? Yes No Owner Type/Value Owner Type/Value Owner Type/Value Unearned Income Has anyone received or expect to receive income from: Date Amount An accident $ Divorce $ Estate sale $ Gambling (including Bingo and Lottery) winnings $ Inheritance $ Insurance settlement $ Lawsuit $ Loan Repayment $ Loss of job $ Money given to you $ Pension or retirement funds $ Probate settlement $ Sale of personal/real property $ Social Security $ Tax/EIC refunds $ Trust fund $ Unemployment insurance $ Workers compensation $ Other $ 90

91 Section X Forms 10.5 Assets Vehicle Does anyone own a vehicle? Yes No 1. Make/Model/Year Owner Insurance Company Premium Payments $ Payment Amount $ 2. Make/Model/Year Owner Insurance Company Premium Payments $ Payment Amount $ 3. Make/Model/Year Owner Insurance Company Premium Payments $ Payment Amount $ Does anyone own a motorcycle Yes No 1. Make/Model/Year Owner Insurance Company Premium Payments $ Payment Amount $ 2. Make/Model/Year Owner Insurance Company Premium Payments $ Payment Amount $ Does anyone own a boat or trailer? Yes No 1. Make/Model/Year Owner Insurance Company Premium Payments $ Payment Amount $ 2. Make/Model/Year Owner Insurance Company Premium Payments $ Payment Amount $ Does anyone own a snowmobile, ATV or other recreational Vehicle? Yes No 1. Make/Model/Year Owner Insurance Company Premium Payments $ Payment Amount $ 2. Make/Model/Year Owner Insurance Company Premium Payments $ Payment Amount $ 91

92 Section X Forms 10.5 Accounts Does anyone have a checking account? Yes No Bank Acct. # Owner Bank Acct. # Owner Does anyone have a savings account? Yes No Bank Acct. # Owner Bank Acct. # Owner Does anyone have any US savings bonds? Yes No Face Value $ Purchase Date Owner Face Value $ Purchase Date Owner Does anyone have stocks or bonds? Yes No Issuer Number of shares/bonds Does anyone have an IRA or other retirement or investment account? Yes No Type Owner Company Address Does anyone have a credit card? Yes No With who Balance $ Monthly payments $ With who Balance $ Monthly payments $ With who Balance $ Monthly payments $ With who Balance $ Monthly payments $ Does anyone have a prepaid burial account or own a burial lot? Yes No With who Owner With who Owner Does anyone have life insurance? Yes No With who Address With who Address Does anyone have a safe deposit box? Yes No Owner Policy Number Owner Policy Number 92

93 Section X Forms 10.5 Property Does anyone own real property? Yes No Owner Location EMV Mortgage Balance: $ Owner Location EMV Mortgage Balance: $ Owner Location EMV Mortgage Balance: $ Does anyone have other property? Yes No Owner Type/Value Owner Type/Value Owner Type/Value Does anyone have outstanding loans on personal property? Yes No Loan holder Property Address Loan amount $ Monthly payments $ Loan holder Property Address Loan amount $ Monthly payments $ Child Support Do you receive child support pass through Direct support payments? Amount Received: $ Name of absent parent Address Absent parent s employer Address Do you receive informal child support? Yes No From Who? How Often? How Much? 93

94 Section X Forms 10.5 Apartments or Home Rental Information Caretaker Landlord Address Address Phone Phone How much rent do you pay? $ Monthly utility expenses Electricity $ Renter s Insurance $ Cable TV $ Phone (land line) $ Water/sewer $ Cell Phone $ Other $ Heat $ Internet $ Total Rent and utility expense $ Do you receive assistance with rent? Yes No Amount $ How is payment made? Name of payor Address Phone Contact person (if agency) Are you renting out any portion of the home or apartment? Yes No Names of tenants Amount of rent paid Utilities paid by renters Home Ownership Information Contract for deed or mortgage company Address Phone Purchase Date Down payment $ Monthly house payment $ Cell Phone $ Electrical $ Phone (Land Line) $ Cable TV $ Heat $ 94

95 Section X Forms 10.5 Internet $ Taxes $ Water/sewer $ Garbage $ Insurance $ Other $ Total monthly house and utility expense $ Are you renting out any portion of the home? Yes No Names of tenants Amount of rent paid Utilities paid by renters Do you receive assistance with the payments? Yes No Amount $ How is payment made? Name of payor Address Phone Contact person (if agency) School Is anyone attending school? Yes No Name Days per week School Grade School address Name Days per week School Grade School address Name Days per week School Grade School address Name Days per week School Grade School address Name Days per week School Grade School address 95

96 FPI Program Guidelines 2011 December Section X Forms 10.5 Has or will anyone receive loans or other financial aid for school? Yes No Name Type of aid Amount $ Date Is aid received directly? Yes No Name Type of aid Amount $ Date Is aid received directly? Yes No Name Type of aid Amount $ Date Is aid received directly? Yes No Daycare Who provides daycare? Phone Address of Provider: Cost of Daycare Health Insurance Does anyone have health insurance coverage (including the absent parent)? Yes No Name of insurance company Address Premium $ Policy Number Is your insurance through your employer? Yes No If you don t have insurance, does your employer offer health insurance? Yes No 96

97 FPI Program Guidelines 2011 December Appendix 11 APPENDIX 97

98 Appendix 1 December Role of the case worker Orientation Document for New FPI Regions In multi-county FPI operations the role of the financial worker is the same in each county. FPI is a financial worker driven program. Without substantial worker buy-in, referrals don t happen and there is no program. FPI investigators are expected to cultivate good working relationships with financial workers, formally and informally. The 15 day average turn around performance standard is one way we measure and insure good investigative service to the worker. Investigators are expected to provide basic fraud recognition and fraud referral training to workers on a regular basis. When possible and practical, personal contact regarding investigative results is desirable. Fraud investigators may make recommendations on case actions, but determining eligibility for a public assistance program is solely the responsibility of the eligibility worker. Investigators assist in determining eligibility by providing financial workers with a written, clear and concise summary of the findings of a fraud investigation sufficient to allow the worker to make a determination of eligibility. In return, financial workers do not make fraud referrals for simple verifications or when the worker could obtain the information on their own. The financial worker has two basic FPI related responsibilities. First, make referrals when fraud is suspected. Second, act on the investigators findings in a timely manner. The standard allowance is 30 days to report back to the investigator on case actions (or no action). All overpayments resulting from a fraud investigation are expected to be computed. The referral process Because multiple counties are involved, every effort needs to be made to remove potential roadblocks to a simplified referral process. The referral process should be as simple as possible and automatic. The rule is If in doubt, refer. Referrals are to be made directly to the investigator. Concurrent referrals to a supervisor or anywhere else are fine, but because the FPI investigator operates under the 15 day average turnaround standard, referrals should not sit awaiting supervisory approval. The referral should contain enough information so that the investigator has a clear idea of what the worker wants to know. The investigator has the responsibility to sort out good referrals from bad. Inappropriate referrals are to be returned to the worker with a polite explanation as to why. If the investigator needs more information than provided by the referral, it is to be considered a teaching opportunity and the investigator should explain why more information is needed rather than just asking for it. 98

99 Appendix 1 December The choice of referral method is entirely at the option of the host county. Generally, there is no acknowledgement of receipt of a referral. The referral is received and quickly assigned to an investigator. When the investigation is completed the worker receives a written report of investigative findings. If an investigation cannot be worked for any reason, the investigator must notify the worker and explain why. If a financial worker has had no contact with a fraud investigator within 30 days from the date of the referral, they are justified in making a request for information on the status of the investigation. Roles of county supervisors and directors Host county Director degree of involvement is optional. Some directors are deeply involved to the point where fraud investigators report directly to them. Some directors choose to receive only regular statistical updates and deal with issues. Director in participating, non-host county again, the level of involvement beyond normal oversight responsibilities is a personal choice. Host county investigative supervisor -- this is where day to day operational control and direction resides. As long as they fall within general DHS guidelines and expectation, decisions on how the FPI program will operate are the responsibility of the host county. The needs and concerns of other regional participants are important and need to be considered, but the final choice always belongs to the host county. Whether or not funding for a FPI programs continues is determined by how cost-effective it is. With funding at stake, host counties have a right to make all operational decisions. Financial supervisor in participating, non-host county the most important function is usually to serve as a liaison between their financial workers and the host county fraud investigator as needed. It is also valuable if they monitor the level of service, quality of investigative findings, quality of referrals, and ensuring financial worker action on findings. DHS evaluation of regional FPI operations Legislation authorizing the FPI program requires it to be cost-neutral to the state. This provision generates an emphasis on county programs being cost-effective. There are many potential ways to judge whether or not a fraud program is effective and efficient but, because of the mandatory cost-efficiency requirement our primary measurement for success or failure is cost effectiveness. Simply defined that is the net value to taxpayers in cost-avoidance and overpayment discovery when set against administrative cost. A secondary measurement is timeliness, how quickly are investigative results returned to financial workers (the 15 day average mentioned before). The FPI guidelines explain the methodology for determining cost-effectiveness in detail. 99

100 100

101 Appendix 1 December DHS performance standards are pass/fail. As long as the cost-effectiveness and timeliness standard are met, county programs are allowed substantial latitude in how they operate their programs. Barring special circumstances, DHS evaluation will be of the region as a whole entity, not separate evaluations for each county involved. At the county level, self-evaluation will usually include such things as county relationships, smoothness of referral process, managing expectations, quality of work, and timeliness of investigations and case actions. Defining success of the FPI relationship between counties in a region must by necessity be more relationship driven and probably with a graduated measurement schedule. Where counties in a regional operation find a mutual level of happiness with the arrangement, or at least acceptance, may take some time to work out. Contractual relationships between DHS, the county hosting the investigator, and other participating counties There is always a signed contractual agreement between DHS and the investigator host county. This contract covers financial and operational obligations between the parties. There is no direct contractual arrangement between DHS and participating, non-host counties. There is a DHS approved form to provide a legal basis for the FPI relationship between the investigator host county and other counties comprising the region. At the present time this is an optional form, its use at the discretion of the investigative host county. 101

102 Appendix 2 December Data integrity SAMPLE FORMAT FOR SUPERVISORY OF FPI INVESTIGATIVE CASES Does information in the Investigative Data Management Application (IDM) match information contained in investigative case record? Weighting -- 25% of review scoring (important because FPI grant funding is dependent on accurate and complete investigation outcome data in the IDM) Do dates in the IDM match case paperwork Do amounts in the IDM match case paperwork Were all legitimate savings and overpayment amounts claimed (overpayments must have claim number) Investigation Technique Was investigative effort sufficient to meet established expectations? Was necessary work completed? Were procedures and policy followed? Was follow up with other agencies or parties completed? Is file organized in a consistent, logical manner? Weighting -- 50% of review scoring Overall thoroughness Was field work done when necessary Was recipient contacted if necessary Were all available data sources used Was time spent on investigation mindful of the need for quick action If an FPI issue, was the ADH or criminal process pursued File organization Case notes If needed, was there timely follow up with case worker to get Part C completed Quality of Summary of Findings and Completeness of Response Does information provided to the financial worker sufficiently answer their questions to allow an action Weighting -- 25% of review scoring Were all questions on referral addressed Was summary complete Was summary succinct Was summary signed and dated 102

103 Appendix 3 December DIFFERENCES BETWEEN FPI AND CRIMINAL FRAUD INVESTIGATIONS Issue FPI Criminal Welfare Case Status Open or application Open, application or closed Types of welfare cases that can be investigated All, but with a priority set by DHS All, based on priority set by County Attorney Administrative only. May Criminal or administrative Outcome be referred for criminal investigation if circumstances merit. 15 day average time Statute of Limitations (3 Years) standard Cost Effectiveness County Attorney sets threshold Standards Programs must show sufficient return on administrative dollars invested. Standard of Proof: Hearsay Standard of Proof: Beyond Reasonable Doubt Proving intent is not required for case action. Proving intent is required for criminal charge Investigative Emphasis Quantity of investigations Quality of investigation Only need information sufficient to allow an action on the current open case. Example: Investigator establishes recipient working 40 hours/week at Because information is subject to a higher level of proof, more detailed and specific information is required. Example: Investigator must obtain documentary evidence to support issues such as wage specific Depth of Investigation $15.00/ hour based on a information from the employer, for phone call to an employer. example an actual check showing Once that information is dates and amounts of payments. provided to caseworker, the FPI is complete. Note that the caseworker or criminal investigator may have additional work to do. If the investigation has been Statute of Limitations (3 Years) actively worked for 30 days Ending Investigations without resolution, close it. Case may require another referral at a later date if the Non-investigative, routine data base queries done as situation continues. No, or as time may allow only 103 No restrictions

104 a courtesy 1 DMV 2 - DNR 3 DEED 4 Bank Records 5 - Other Position Funding State and Federal County and Federal State Oversight Yes No 104

105 Appendix 4 December