CWES Overpayment & Underpayment - Overpayment Recoupment

The EC must record the overpayment using the Recovery Account Detail page in CalSAWS and notify the overpaid individual of the overpayment, regardless of whether the recovery/collection of the overpayment will be deferred or not. For overpayment recovery/collection that is not deferred, the client or provider is given ten (10) calendar days to respond and to enter into a repayment agreement. Refer to Chewable Byte: How to a Create Recovery Account to have the Client as a Responsible Party.

If recovery/collection of the overpayment is deferred, an overpayment referral to Collections is NOT made until the deferral expires. A referral to Collections is made only under certain conditions. Refer to End of Deferral - Reevaluation.

Recovery/collection deferrals do NOT apply if the provider caused the overpayment, for which the provider is responsible. Therefore, the EC MUST refer all provider-caused overpayments to Collections if the provider failed to:

Complete and sign the Child Care Provider Overpayment Notice and Consent SCD 1788 within ten (10) calendar days after the notice was mailed, and
Consent to child care provider payment reduction, or
Repay the full overpayment within the 30 calendar days the SCD 1788 was mailed.

Book Vouchers

When a reimbursement is issued to a bookstore service provider via a book voucher, and an administrative error results in an overpayment, the bookstore is contacted by the ESI Unit. The bookstore will be instructed to return the check, the check will be voided by ESI, and a new check for the correct amount is issued, as appropriate. If the check is already cashed, the amount overpaid is posted to the bookstore’s account and deducted from a future payment.

Administrative Overpayment

When an overpayment is caused by the Agency (or by the EC) and the client agrees to a grant adjustment, then 5% of the current total payment (round down - drop the cents) is collected, unless the individual volunteers to pay a higher percentage.

Client-Caused Overpayment

When an overpayment is client-caused and the client agrees to a grant adjustment, then 10% of the current total payment (round down - drop the cents) is collected, unless the individual volunteers to pay a higher percentage.

Provider-Caused/Responsible Overpayment

When an overpayment is caused by the provider or administrative error to which the provider is responsible, repayment is required.

The “Child Care Provider Overpayment Notice and Consent” (SCD 1788) is to be completed and signed by the child care provider and returned to the EC within ten (10) calendar days after the notice was mailed to the child care provider. The SCD 1788 includes the provider’s written consent to recover overpayments and repayment options. The provider has 30 calendar days from the date the SCD 1788 was mailed to repay the overpayment either by:

Making the full payment to the County's Department of Tax and Collections (DTAC), or
Child care payment reduction - deduct the overpayment amount from the next child care payment(s) until the full amount owed is paid.

If the provider fails to repay or consent to child care payment reduction within 30 calendar days from the SCD 1788 was mailed, the EC must make a referral to Collections. Refer to CWES Overpayment & Underpayment - Referral to Collections.

CalWORKs Grant of Less than $10

A CalWORKs grant of less than $10 is not issued to clients due to regulations; however, since the recipient is eligible for CalWORKs, the EW must collect this amount to adjust any existing supportive services overpayment.

Note: This only applies when the individual chooses the CalWORKs grant adjustment method of recovery.

Multiple Types of Overpayments

Multiple overpayments may occur in the same month or over a period of time. A separate overpayment computation and referral must be made when:

There is more than one type of overpayment.

Example 1Example 1

There is an Administrative overpayment and an Other overpayment occurred in July and August. Two separate overpayment records must be entered in CalWIN.

There is more than one overpaid payee.

Example 2Example 2

The child care provider bills and is paid for child care services, however, the EC becomes aware that there is an error in the number of hours billed. The provider is then responsible for this child care overpayment.

On the other hand, the client failed to provide original receipts for ancillary payments. The client is then responsible for the ancillary overpayment. A separate overpayment record must be entered in CalWIN for the provider-caused and client-caused overpayment.

Procedures to Locate the Overpaid Payee

The EC must take the following steps to attempt to locate the overpaid payee when that individual is no longer receiving benefits in the overpaid assistance unit:

Use the available information in CalWIN to see if the overpaid payee can be located.
Ask the current payee where the overpaid payee may be. DO NOT collect from the existing assistance unit if the whereabouts of the overpaid payee are not known.

Locatable Overpaid Payee

If the individual responsible for the overpayment to the assistance unit is no longer eligible for CalWORKs or supportive services, or if he or she becomes a member of another assistance unit, or the person is no longer the current child care provider, overpayments will be collected:

From the overpaid individual,
From the overpaid individual’s present assistance unit if the client chooses this method of recovery and agrees with the amount of CalWORKs adjustment. This does not apply for provider-caused overpayment.

Unlocatable Overpaid Payee

If the overpaid payee was the client and cannot be located, DO NOT recoup the overpayment from the overpaid assistance unit.

If the overpaid payee was the provider and cannot be located, DO NOT recoup the overpayment from the client nor from the overpaid assistance unit.

An overpayment referral to Collections must be made if the overpaid payee cannot be located.

Recoupment from Overpaid Payee

Continue to recover from the overpaid payee until any one of the following occurs:

The payee cannot be located.
The payee has the overpayment discharged in bankruptcy.
The County Collections is unable to execute a legal process to collect. This occurs when the payee is no longer on aid, the overpayment is non-fraudulent and the balance is less than $35,
The payee dies, and the balance cannot be collected from the payee’s estate.

Recoupment/collection may occur in sequence against any one member at a time or concurrently from any of the members, when in separate AUs or when not receiving aid.