SR 95-47 Dated 07/95

STATE OF NEW HAMPSHIRE

INTER-DEPARTMENT COMMUNICATION

SUMMARY

This SR releases policy on the administrative disqualification process in the AFDC Program due to intentional program violation (IPV), and requires that District Offices recoup $10 per month during the disqualification period. This SR also releases new Form 402, Administrative AFDC Disqualification Hearing Waiver, new Form 403, Notice of AFDC Disqualification, and related forms instructions. In addition, this SR revises Form 436, Advance Notice of your Administrative Disqualification Hearing, and its instructions. Form 439, Administrative Disqualification Hearing Procedures has been revised, and instructions have been developed for this form. Part 713 has been revised to reflect current procedures on demand letters for food stamp households guilty of IPV. Households must choose a method of repayment within 10 days from the date the demand letter was mailed. If the household does not respond to the demand letter within the 10 day period, their monthly allotment is reduced.

This SR also includes two additional changes. All references to the Bureau of Food Stamp Recoveries (BFSR) have been changed to the Office of Special Investigations (OSI) in FAM Chapters 621 and 713. Chapter 703 was revised to show that emergency assistance payments for mortgage-only arrearages can be authorized for up to two months. This revision is a technical correction that was made to reflect current emergency assistance policy.

POLICY

Prior to the release of this SR, there was no administrative disqualification process in the AFDC program. An AFDC disqualification process similar to that used in the Food Stamp Program is now in effect. Once the Office of Special Investigations (OSI) is aware of a potential IPV case through a District Office or Quality Assurance referral, complaint, crossmatch, or any other sources, it screens the case for IPV intent. If OSI believes by clear and convincing evidence that intent exists, OSI then refers the case for an administrative disqualification hearing with the Hearings Office, and informs the District Office of the results of the hearing. Any IPV action taken by the Division against an accused individual in an AFDC case is coordinated with any action being taken under the Food Stamp Program when the factual issues arise from the same or related circumstances. The Office of Special Investigations notifies the District Office of the case’s IPV status and of any required District Office action.

The definition of intentional program violation, IPV related forms, an overview of the administrative disqualification process, disqualification penalties and recoupment procedures are provided below. The forms are described directly after the definition of intentional program violation because they are essential to the understanding of the administrative disqualification process.

Definition of Intentional Program Violation

In the AFDC Program, the casehead is the only individual who can be held liable for intentional program violation. The casehead has committed an intentional program violation when causing an overpayment due to any of the following:

 Intentionally providing misleading information;

 Refusing or failing to report a change in household circumstances; or

 Purposely committing any act that violates any public assistance regulations or any state statute relating to public assistance.

Only one of the following can officially establish intentional program violation in the AFDC program:

 A court of appropriate jurisdiction;

 The casehead’s signing of a waiver of the right to an administrative disqualification hearing;

 An administrative disqualification hearing through the Hearings Office; or

 A signed consent agreement confirmed by the court.

New and Revised Forms

New and revised forms that are related to the administrative fraud disqualification process are described below. All of these forms are computer generated at State Office. None of these forms will be printed or distributed for District Office use.

New Form 402

Form 402, Administrative AFDC Disqualification Hearing Waiver, is completed by OSI when an individual is suspected of having committed IPV. This form explains the individual’s rights in regards to the hearing process and allows the individual to waive hearing rights. This form also explains how disqualification affects AFDC eligibility and benefits.

New Form 403

OSI completes Form 403, Notice of AFDC Disqualification. This form advises currently eligible recipients of the reason for and the effective date of the individual’s disqualification. It also explains that the individual’s needs will be removed from the AFDC grant during the disqualification period. If the case is no longer eligible, this form advises the disqualified individual that the disqualification will take effect when the individual reapplies and is found eligible for assistance.

Revised Form 436

This SR revises Form 436, Advance Notice of Your Administrative Disqualification Hearing, and its instructions so that they apply to both AFDC and food stamp cases. Form 436 advises the individual of alleged IPV status, IPV penalties and rights regarding the hearing process.

The Hearings Office initiates this form whenever an administrative disqualification hearing is scheduled.

Revised Form 439 and New Form 439(i)

This SR revises Form 439, Administrative Disqualification Hearing Procedures, which explains the individual’s rights regarding the hearing process. The form has been revised to reference both AFDC and food stamp cases. Either OSI or the Hearings Office may initiate this form. Although this form had previously been used for the Food Stamp Program, no forms instructions were issued at that time. Therefore, Form 439 (i) is being released with this SR.

Overview of AFDC Disqualification Process

When OSI is aware of a potential IPV case, it screens the case for intent and clear and convincing evidence. OSI then decides whether to take further action on the case. For cases in which intent appears to exist, OSI sends or hand delivers Form 402, Administrative AFDC Disqualification Hearing Waiver, to the individual. The procedures differ based on whether or not the individual signs Form 402.

Individual Signs Form 402

If the individual signs a Form 402, OSI sends the individual Form 403, Notice of AFDC Disqualification and provides a copy to the District Office. Upon receipt of the disqualification notice, the District Office initiates the disqualification and recoupment in accordance with the policy sections below.

Individual Refuses to Sign Form 402

If the individual refuses to sign Form 402, OSI may request an administrative hearing through the Hearings Office which sends Form 436, Advance Notice of Your Administrative Disqualification Hearing, to the individual. Copies are forwarded to OSI and the District Office. Form 439, Administrative Disqualification Hearing Procedures, is also provided to the individual. The hearing is generally scheduled within 30 days of request. The hearing is held regardless of whether the individual appears. If the individual fails to appear, claims and is granted good cause for failure to appear within 10 days of the scheduled hearing, the hearing is rescheduled. The hearing decision is made within 90 days of the hearing date. The Hearings Office advises the District Office of the decision. If IPV is determined, OSI advises the District Office to initiate the disqualification and recoupment as indicated below.

Disqualification Penalties

A disqualification penalty for intentional program violation (IPV) applies to an AFDC casehead who has pled guilty or nolo contendre or who is otherwise found to have committed IPV as a result of signing a waiver, an administrative disqualification hearing, or by a court of appropriate jurisdiction. The disqualification will remain in effect for the duration of the penalty period, and cannot be reversed by an administrative hearing. Only a court of appropriate jurisdiction can change the original penalty. The disqualification penalty is similar to the disqualification penalty for failure to cooperate with IV-D child support or JOBS requirements, and affects AFDC financial assistance as noted below.

 The AFDC casehead’s needs are excluded when determining the assistance group’s needs and amount of AFDC financial assistance.

 The casehead’s income and/or resources are considered available to the assistance group throughout the disqualification period. No employment related disregards or deductions are allowed from earned income. Other deductions listed in FAM Part 603 may be allowed.

 The disqualification period is 6 months for the first offense; 12 months for the second offense and permanently for the third offense.

Begin Date of Disqualification

The disqualification period for an AFDC case begins no later than the first day of the second month following the date that the individual was sent Form 403, Notice of AFDC Disqualification.

Recoupment During and After the Disqualification Period

All overpayments of AFDC must be repaid in full to the Division regardless of the length of time the overpayment has existed. If the case is currently open for AFDC financial assistance and the casehead’s needs are excluded and income is counted during the disqualification period, the recoupment amount is limited to $10 per month. This limitation exists to minimize the financial hardship on the AFDC case. Once the disqualification period has ended, the remainder of the overpayment is recouped at the rate of 10% of the assistance group’s payment standard. See FAM Section 621.03.

SYSTEM CHANGES

Due to time constraints, only minimal systems changes are being made at this time. The previous AFDC work registration sanction code S that was used for failure to cooperate with WIN (Work Incentive requirements) will now be entered in Field I-28 and used to disqualify AFDC IPV violators. The date of disqualification must also be entered in Field I-29. (Work registration date). Use of these codes will exclude the AFDC casehead’s needs from the grant when determining eligibility and benefits for the remaining assistance group members. In addition, protective payee entries of H (JOBS/IPV protective payee/other) will be required in Fields H 16 and 17. Eventually, a second set of changes will allow for more automated processing of IPV cases. District Offices will be advised of these changes under separate cover as they are completed.

Manual procedures are required to enable EMS to exclude the needs of an AFDC parent guilty of IPV from the AFDC grant. These procedures require a manual calculation of eligibility, a manually prepared Notice of Decision, and entries to the AP grant adjustment field and work registration field which are explained below.

Manual Determination of Eligibility and EMS Coding

Prior to making any entries on EMS, the District Office must manually determine if the case will remain eligible with the parent’s needs excluded with and without the $10 monthly recoupment taken, and take the appropriate action.

 If the case is eligible with the parent’s needs excluded and the $10 monthly recoupment, enter code S (IPV violator) in Field I-28 and the H-line entries described below.

 If the case is eligible with the parent’s needs excluded, but would be ineligible with the $10 monthly recoupment, omit the grant adjustment entries. [Begin recoupment when the parent’s disqualification has ended.]

 If the case is ineligible with the parent’s needs excluded, take action to close the case. [Begin recoupment when the case is eligible for AFDC financial assistance again.]

The Case Technician must make the following entries as part of the same transaction when entering code S in Field I-28 and the date of disqualification in Field I-29:

 Code D (Omit NOD and Advance Notice Period);

 Code H (JOBS/IPV protective payee) in Field H-16 (Payee code) and Code H (Other) in Field H-17 (Payee reason);

- If no other payee is found, use the excluded parent’s name and address on the H Line.

 The prorated share of the excluded casehead’s income on each remaining individual’s I-Line.

- Do not allow earned income disregards and deductions or include the parent as a

case member when prorating the income. Use income code 155 to code prorated

income.

INCOME PRORATION

The AFDC casehead has 3 children and has gross earnings of $300 per month. The gross income is prorated to the children only, with no earned income disregards or deductions allowed. Each child’s prorated share is $100.

The Case Technician must also complete the following entries:

 The excluded parent’s income on the excluded parent’s I-Line. The income will not be used to compute eligibility, since the code 155 amounts will be used (see the prorated section above).

 The excluded parent’s income on the resources on the excluded parent’s I-Line.

- EMS automatically determines resource eligibility using the excluded parent’s

I-Line resources.

 Code B [Grant Adjustment (decrease) in Field A-39 and 44, Reason Code 76 (fraud) in Field A-40 and 45, a $5.00 check amount in Field A-41 and 46, a "from date" equal to the transaction date in Field A-42 or 47, and a "to date" equal to the date of the last payroll period of the recoupment in Field A-43 or 48. See Case Action Order Handbook ITEM A, Grant Adjustments, for further information.

NOTE: If there is a current grant adjustment already on EMS, the District Office must

suspend that grant adjustment and enter the IPV grant adjustment in its

place. When the AFDC casehead’s disqualification period ends and his or

her needs are included, then the previous grant adjustment can be

reinstated. The District Office must also remove the $5.00 grant adjustment

and enter a new recoupment amount for IPV.

 Enter a future date on the TSM Change Screen to track the end of the IPV disqualification. When entering the date, allow sufficient time to add the disqualified individual back into the AFDC case at the end of the disqualification period.

Manually Prepared Notices of Decision

Cases whose benefits will be reduced or terminated due to IPV are entitled to a 10 day advance notice period. Because code D in Field A-50 omits both the NOD and advance notice period, it is necessary to send the manual NOD to the casehead in enough time to allow for proper notice. Action and Reason Messages for decreases and closings and for increases due to the end of the disqualification period appear below.

~~~ Action Messages for Decreases~~~

The action message for an AFDC decrease is as follows.

BEGINNING WITH (dd/mm/yy) CHECK, YOUR AFDC GRANT WILL DECREASE FROM ($XXX.XX to $XXX.XX) PER MONTH or

YOUR AFDC MONEY PAYMENT HAS DECREASED TO LESS THAN $10.00 PER MONTH. BEGINNING WITH (dd/mm/yy), YOU WILL NOT GET A CHECK SINCE THE DIVISION CANNOT MAKE REGULAR MONTHLY PAYMENTS OF LESS THAN $10.00. YOUR MONEY PAYMENT CASE IS STILL OPEN AND ALL RULES APPLY. YOU ARE ELIGIBLE FOR MEDICAID.

~~~ Action Message for Closing ~~~

YOU ARE NO LONGER ELIGIBLE FOR A MONEY PAYMENT UNDER AFDC. YOUR LAST CHECK IS MAILED (date). IF YOU WANT OR NEED HELP WITH CHILD CARE, SEE THE ENCLOSED FORM 810 FOR IMPORTANT INFORMATION.

~~~ Reason Message for Both AFDC Decreases And Closings ~~~

Administrative Disqualification for Fraudulent Acts (AFDC)

AS A RESULT OF A FINDING FOR INTENTIONAL PROGRAM VIOLATION(S), WE HAVE REMOVED YOUR NEEDS FROM THE AFDC GRANT. IF YOU CONTINUE TO RECEIVE AFDC BENEFITS, WE WILL RECOVER ANY OVERPAYMENTS BY REDUCING YOUR GRANT BY AN EXTRA $10 DURING YOUR DISQUALIFICATION. FAMILY ASSISTANCE CHAPTER 200, 600, 700.

~~~ Action Message for AFDC Increase ~~~

BEGINNING WITH (mm/dd/yy) CHECK, YOUR AFDC GRANT WILL INCREASE FROM ($XXX.XX) TO ($XXX.XX) PER MONTH.

~~~ Reason Message for AFDC Increase ~~~

End of Administrative Disqualification for Fraudulent Acts (AFDC)

YOUR DISQUALIFICATION PERIOD FOR INTENTIONAL PROGRAM VIOLATION HAS ENDED. YOUR NEEDS HAVE BEEN ADDED BACK TO YOUR CASE. YOUR BENEFIT WILL BE REDUCED TO CONTINUE TO COLLECT ALL THE MONEY THAT YOU WERE OVERPAID. FAMILY ASSISTANCE CHAPTER 600.

Use of EMS Displays During Disqualification Period

When referring to EMS displays during the IPV disqualification period, District Offices should be aware of the following:

 Eligibility sets on the I-L display show that the parent is eligible for AFDC financial assistance, and

 The exclusion code S on the I-K display and the grant adjustment indicators on the I-E display are the only indicators that the casehead is disqualified.

IPV Violators and Eligibility for JOBS Services

An AFDC casehead whose needs are removed from the AFDC grant for IPV is no longer eligible for JOBS services. District Offices must enter code A (Primary Recipient, Adult) in Field I-38 (Social Service Status) to prevent the casehead from receiving payment for JOBS services. Children still retain their eligibility as long as the AFDC financial assistance case remains open and all other eligibility requirements are met. A valid code must be entered in Field I-38 on the child’s I-Line in accordance with Section 102 of the EMS Handbook to insure that child care benefits continue to be paid.

AFDC Related Food Stamp Cases and Use of Deduction Code 570

When EMS determines food stamp eligibility and benefits, it counts the full AFDC grant as unearned income, and does not automatically increase food stamp benefits if the grant is being recouped. Normally when an AFDC case has a recoupment from the grant, the District Office enters deduction code 570 (Recoupment from AP grant) so the food stamp computation will be based on the actual grant received. For AFDC cases in which there is an IPV violator, District Offices must not enter code 570, because policy prohibits food stamp benefits from increasing due to intentional program violation.

IMPLEMENTATION

This policy applies to all eligibility determinations made on or after July 1, 1995.

CLIENT NOTIFICATION

A client notice on the disqualification policy was sent to all open ADFC recipients with the 6/30 check. District Offices were provided with an initial supply of the client notice under separate cover. Effective July 1, 1995, until revised Application Form 800 is released containing the AFDC disqualification penalty, all households applying or being redetermined for AFDC financial assistance must be given a copy of this notice. This notice will not be required for AFDC financial assistance cases at mail-in redetermination after forthcoming SR releases Form 800R, Application for Redetermining Eligibility for Assistance.

TRAINING

No training is planned. If the need for training arises, District Offices should contact their Regional Administrator.

MANUAL PAGE CHANGES

Family Assistance Manual

Family Assistance Manual Part 621 has been reformatted to include the policy on repayments for overissuances in the Food Stamp Program due to administrative and inadvertent household error. Previously, this information had been included in Part 715, which has been obsoleted. Parts 713 has been reformatted and revised to include the policy on IPV for AFDC cases. Part 713 also contains IPV related information which was previously included in Part 715.

EMS Handbook

Section 102 of the EMS Handbook will be revised to reflect required IPV entries for AFDC caseheads found guilty of IPV. Section 102 will be issued under separate cover.

POSTING INSTRUCTIONS

DISPOSITION

This SR must be retained in front of the Family Assistance Manual until EMS Handbook changes for IPV are released. SR 95-40 which is currently retained in Section 713.11 of the FAM may be removed and destroyed.

DISTRIBUTION

The SR only is being distributed according to the distribution list for the Family Assistance and Forms Manuals. The SR and the manual pages will be distributed to all holders of the FAM and the Forms Manual.

OES/SJC:s