Suspending a Claim

Definition

If Public Assistance Collection action was initiated, and at lease one demand letter has been sent, the county may suspend further collection action of an IHE or AE OI claims against a nonparticipating household as shown in the chart below:.

Overissuance Type	Original Total of all Over-Issued Months	Case Status	ADDITIONAL CIRCUMSTANCES
AE	$35 or less	Open	The overissuance ended between 11/91 and 10/92.
AE	More than $400	Closed	The household cannot be located.
IHE	More than $400	Closed	The household cannot be located.
IPV	$1 or more	Closed	The household cannot be located; or The cost of further collection action is likely to exceed the amount that can be recovered. At least one demand letter for claims of less than $100. At least two demand letters for claims between $100 and $400. At least three demand letters for claims of more than $400.

Supplemental Payments

Do not suspend an overissuance claim that can be offset by supplemental payments.

Removing a Suspension

An overissuance suspension shall be removed if:

• The claim is used to offset an underissuance or supplemental payments, or
• The client agrees to a benefit reduction adjustment or repayment.

If a portion of the claim is used to offset an underissuance or supplemental payments within the three year suspension period, any remaining balance of the claim may be placed into suspension again for a new three year period.

Terminating a Claim

Definition

A claim may be terminated when:

• The original amount of the overissuance was less than $35, and
• The overissuance was in suspension for three years, and
• Neither of the following occurred while the claim was suspended:
  • No portion of the claim was offset by an underissuance or supplemental payments, or
  • The client has not responded to the collection notice and repayment agreement.

Supplemental Payments

Do not terminate an overissuance claim that can be offset by supplemental payments. Send a memo to Public Assistance Collections if an overissuance balance is offset by supplemental payments, and send a copy of the memo to Imaging.

Once a claim is terminated, there is no further collection activity on that specific claim. However, the balance on the overissuance shall be used to offset any future entitlement to supplemental payments.

Intentional Program Violation (IPV)

Disqualification Penalty [63-801.231, 20-300.1-3, 63-805]

Regulation

An IPV claim may only be established after a determination by one of the methods shown below that a household member has committed an IPV offense.

Treat an overissuance caused by household failure to report as an IHE until it is determined to be an IPV by one of the methods shown in the chart below.

At times, an Administrative Law Judge will impose a disqualification period that does not match the ones shown in the chart below. When this happens, impose the time period set by the court.

IPV OFFENSE	METHOD OF DETERMINATION	DISQUALIFICATION PERIOD
HH intentionally collected more CalFresh than it was eligible to receive.	Court of appropriate jurisdiction, or ADH official, or HH waives the right to an administrative hearing by signing a: “Disqualification Consent Agreement” (DFA 478), or “Waiver of Right to an Administrative Disqualification Hearing”. (The State provides these forms to HHs when it notifies them of the IPV hearing schedule.)	For any IPV that was committed on or after December 1, 1996: 1st violation: 12 mos. **2nd violation*: 24 mos. **3rd violation*: permanent disqualification.** For any IPV that was committed prior to December 1, 1996: 1st violation: 6 mos. 2nd violation*: 12 mos. 3rd violation*: permanent disqualification. **All IPVs that occurred PRIOR to 12/1/96 are considered as one previous disqualification when determining which penalty to impose for IPVs committed on or after 12/01/96. *Count ALL prior IPVs, including any for trading CalFresh for drugs or weapons, trafficking in CalFresh, or falsifying identity or residence. Note: For a fraudulent act that began prior to 12/01/96 but extends beyond 12/01/96, the penalty period for IPVs that occurred on or after 12/01/96 is to be imposed.
HH traded CalFresh for a drug or other controlled substance (does not apply to alcohol.)	Court of appropriate jurisdiction.	For any drug IPV that was committed on or after December 1, 1996. 1st violation: 24 mos. 2nd violation*: permanent disqualification. For any drug IPV that was committed prior to December 1, 1996. 1st violation: 12 mos. 2nd violation*: permanent disqualification. *Count ONLY prior IPVs for drug trafficking. Do not count prior fraud IPVs. Note: For a fraudulent act that began prior to 12/01/96 but extends beyond 12/01/96, the penalty period for IPVs that occurred on or after 12/01/96 is to be imposed.
HH traded CalFresh for firearms, ammunition, or explosives.	Court of appropriate jurisdiction	1st violation: permanent disqualification.
HH trafficked in CalFresh with a value of $500 or more.	Court of appropriate jurisdiction	For IPVs committed on or after December 1, 1996: 1st violation: permanent disqualification.
HH falsified identity or place of residence in order to receive multiple CalFresh benefits simultaneously.	Court of appropriate jurisdiction, or ADH official.	IPV committed on or after December 1, 1996: 1st and all subsequent violations: Ten (10) years

Who Is Disqualified

Adults found to be responsible for an IPV may be disqualified from participation in CalFresh. Disqualify only those adults specified in the court order, waiver, or DFA 478.

When an IPV decision is rendered by court or administrative hearing without specifically identifying who is to be disqualified, disqualify those adults who were found in the court order to have committed the IPV.

Beginning and Ending Dates

COURT ORDER OR “DISQUALIFICATION CONSENT AGREEMENT” (DFA 478)

A disqualification by court order or signature on the DFA 478 must begin within 45 days (including time for the five-day NOA) of the date of either action, unless the court specifies otherwise. An overissuance results if the county fails to implement the disqualification period on time.

ExampleExample

ExampleExample

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Administrative Disqualification Hearing

A disqualification by Administrative Disqualification Hearing must begin the first day of the month after the five-day disqualification NOA is sent.

Individual is Already Disqualified for Another Reason (such as Social Security Number)

Do not wait for the other disqualification to end before beginning the IPV disqualification. Both disqualifications must be implemented at the same time.

CalFresh Portion of the Case is Discontinued or Closed

Impose the disqualification period even when the case is discontinued or closed.

After the Disqualification Begins

The disqualification period does not stop until the time period ends, even if the case closes or the household becomes ineligible.

When the Disqualification Period Ends

The head of household must reapply for benefits for the disqualified household member. Complete a tickler to remind the head of household to reapply for the disqualified member(s) in the last month of the disqualification period.

IPV and Loss of Earned Income Deduction

When determining the value of an IPV OI in which earned income is the basis for the OI, the County must not apply the earned income deduction.

Benefit Reduction Amount

Benefits must be reduced to collect an IPV overissuance at the rate of 20% of the household's monthly allotment or $20 per month, whichever is greater. This reduction rate must be implemented immediately upon notification that the overissuance has been determined an IPV. Do not wait for a recalculation of the overissuance disallowing the earned income deduction to reduce benefits.

NOA Requirement [20-300.3]

A FIVE-day NOA “Notice of Administrative Disqualification” (DFA 377.7A) must be sent to the household member who is being disqualified.

The NOA must include:

• The reason for the disqualification.
• The effective dates of the disqualification period.
• For an ACTIVE case, the reduced allotment amount that the other household members will receive.
• For a DISCONTINUED case, a statement that the household may reapply after the disqualification period ends.

In addition, the form, “Request for Restoration of CalFresh Benefits After Administrative Disqualification” (DFA 377.7A1) must be attached for the disqualified household member to request restoration of benefits following an IPV sanction, except in situations where the disqualification is permanent.

Income and Budgeting [63-402.223, 63-502.17, 63-503.441(A), 63-505.5]

• The income and resources of a disqualified household member(s) are considered totally available to the remaining members of the household.
• Include as income that portion of an CalWORKs, ECA OR GA grant which is being adjusted to repay an overpayment caused by the household's intentional failure to comply (fraud) as determined by the cash aid program.
• The earned income deduction is not allowed for that portion of earned income which the household intentionally failed to report.
  • IF THE ORIGINAL OVERISSUANCE CLAIM WAS COMPUTED BY An EW, THEN THE OVERISSUANCE WILL BE RECALCULATED WITHOUT THE EARNED INCOME DEDUCTION BY EW (CalSAWS).
  • IF THE ORIGINAL OVERISSUANCE CLAIM WAS COMPUTED BY Anyone other than an EW, THEN THE OVERISSUANCE WILL BE RECALCULATED WITHOUT THE EARNED INCOME DEDUCTION BY IEVS.
• Although the income of the disqualified member is counted in its entirety, the disqualified member is not included in the person count when:
  • Comparing the household's monthly income with the income standards.
  • Determining the monthly allotment.
• All household deductions and expenses apply to the remaining household members. [Refer to CalFresh chapter “Excluded and Non-Household Members” for further information.]

Identification

IEVS Abstract

EWs must review the IEVS Applicant Abstract to identify whether an applicant has been disqualified for CalFresh in another county or state. If an individual has been disqualified, or a disqualification is pending, this will be listed under “Disqualification Information” on the Abstract. [Refer to DEBS Business Process Handbook chapter “IEVS Recipient System”.]

EW Action

When the EW identifies from the IEVS Applicant Abstract that an IPV has occurred or is pending in another county or state, the EW must take the following steps

 

1. IF THE “START DATE OF PENALTY”...
   1. Shows 99/99/99 and the case is from another county or state,
      1. Phone the contact person at the number listed in the “Disqualification Information” section of the IEVS Abstract. Ask for the beginning date of the disqualification and confirm the other information given on the IEVS Abstract.
   2. Shows 99/99/99 and the case is in this county,
      1. Look in the case record to determine the beginning date of the disqualification.
   3. Shows an actual date,
      1. It is not necessary to call the other county or state, or to look in the case record if it is in this county.
2. Use the “Start Date of Penalty” and “Length” to determine whether the disqualification period has expired yet.
   1. If the disqualification period has been completed, take no action. Process the CalFresh application normally. Stop Here.
   2. If the disqualification period has not been completed, go to STEP 3.
3. Deny benefits. Send the client the appropriate disqualification notice of action.
4. Complete the “Disqualified Recipient Report” DPS 524 in duplicate following the instructions on the back of the form.
   1. Send the original to the CalFresh Coordinator.
   2. Send a copy to Imaging.

Note: Eligibility Examiners in the IEVS unit receive the IPV notification, record entries in CalSAWS, and generate all notices.

End of Disqualification Period

The disqualified individual must be added back to CalFresh the month following the expiration of the disqualification, subject to continue eligibility of the household. A monthly report PROG4635 “Clients with IPV Disqualifications”, is loaded into Business Objects and actions must be taken accordingly.

If the Disqualified Household Member...	Then, the Individual Must...
Is still a member of the CalFresh household in which he or she was previously receiving benefits,	Be added to the household the month following the expiration of the disqualification period, subject to the continuing eligibility of the household. No additional forms to add a person are needed since the individual is still a member of the household. In the case of a missing verification, notify the household using the form “CalFresh Request for Information” (DFA 387) and allow at least ten (10) days for the verification to be returned. The individual will not be added back to the household if the requested verification is not received. A denial notice must be sent for that individual if fail to provide verification. Refer to NOTE below.
Is now a member of a different CalFresh household,	And...	Then, the Individual Must...
	This has been reported to the county,	Be added to the CalFresh household the month following the expiration of the disqualification period, subject to the continuing eligibility of the household.
	The change in the household has not been reported to the county, Be added to the household the month following the end of the disqualification period, if the county receives a request to add the person.	This request may be done by using the form DFA 377.7A1, by verbal request (over the phone or in person) or in writing. It can also be indicated as a change in the Eligibility/Status Report (SAR 7) or by any other method.
Does not reside in a CalFresh household,	Reapply for CalFresh and, if eligible, will be issued benefits as of the date the re-application was submitted or on the first day following the end of their disqualification period, when the application is submitted prior to the end of their disqualification period. Note: A CalFresh application may be submitted up to 30 days prior to the end of the disqualification period in order to ensure eligibility is determined before the end of the disqualification period. The disqualified household member is eligible for Expedited Services if he or she meets the criteria.

 

Note: Adding a person to the household is not a mandatory mid-period requirement. If the required verification from the disqualified household member is not received, only that individual’s eligibility is impacted and the individual will not be added to the household. The household will receive a no-change notice of action and will continue to receive the same amount of benefits as previously determined. When the change is reported in the SAR 7 and verification needed are not received by the due date, a timely NOA must be sent to discontinue the entire household.

Related Topics

How to Process an Overissuance