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Minnesota Department of Human Services Combined Manual
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DETERMINING INCORRECT PAYMENT AMOUNTS

ISSUE DATE: 08/2016

When you find a payment was incorrect, reconstruct each budget month and corresponding payment month using the policies and procedures that were in effect for the payment month. The overpayment or underpayment is the difference between the benefit amount the client actually received and the benefit amount the client should have received.

Overpayments once computed must be entered on MAXIS through the CCOL/CLAM queue. See 0025.21.07 (JOL - Establishing Claims), 0026.39 (Notice of Overpayment and Recoupment). Enter claims you suspect are fraud claims as client error initially, and adjust them later to fraud if appropriate. Once entered on MAXIS, initiate recovery on collectible claims. See 0025.12.06 (Repaying Overpayments - Participants), 0025.12.09 (Repaying Overpayments - Non-Participants), 0025.24.03 (Recovering Fraudulently Obtained Assistance).

To determine if a client was overpaid, refer to other sections of this manual. For example, see 0022.21 (Income Overpayment Relating to Budget Cycle) to determine if an increase in income results in an overpayment. See 0008 (Changes in Circumstances) for information on other changes that may cause an overpayment or underpayment.

When computing overpayments, allow earned income disregards and work expense deductions only for earned income reported timely. Timeliness varies between programs, see program provisions. Do not allow the earned income disregard on income reported through other means such as IEVS, a “New Hire Message”, or a person other than the client, the authorized representative, or guardian. If a client reports only part of his/her earned income, do not allow earned income disregards on the income not reported timely. (For example, a client has 2 jobs but fails to report the 2nd job. When computing the overpayments, allow all the disregards on the earnings from the 1st job but not the 2nd job.) Also see 0018.06 (Work Expense Deductions), 0018.18 (Earned Income Disregards).

When processing a restored benefit on a case that has a claim for the same period, ALWAYS enter the claim first. MAXIS will apply the restored benefit amount to the claim when appropriate. See TEMP Manual TE02.08.025 (Restored Benefits Applied to a Claim).

Determine Discovery and Established Dates as part of the process for calculating a claim. See DISCOVERY DATE in 0002.15 (Glossary: Deed...), ESTABLISHED DATE in 0002.21 (Glossary: Employment...), TE02.09.01 (Entering Claims). Documents needed to calculate a claim could be wage stubs, W-2s, bank statements, employer verification, etc.

Do not include any amounts in the overpayment calculation that occurred more than 6 years prior to the Discovery Date for overpayments due to client error or fraud. Do not include amounts that occurred more than 1 year prior to the Discovery Date for overpayments due to agency error.

If the Discovery Date is not correctly identified it can result in monthly overpayments erroneously being included or excluded in a claim. See 0025.12.12 (Action On Overpayments - Time Limits).


MFIP:

DO NOT establish an overpayment or underpayment for prospectively budgeted units for any month for which you based the assistance issued on the best information available at the time, if you applied the correct policy, and there was no client error.

DO NOT establish an overpayment when a 100% sanction has not been imposed due to the agency’s failure to act. See 0028.30.03 (Pre 60-Month Type/Length of ES Sanctions).

Use retrospective budgeting CONTINUOUSLY for all previously retrospectively budgeted months whether or not there were months of total ineligibility. DO NOT change budget cycles due to months of ineligibility.

For purposes of allowing the earned income disregard, a report is timely when the client or authorized representative reports income within 2 calendar months following the end of the month in which the income was received.

Reporting procedures and client notice requirements used when clients report timely do not apply when changes in household composition are not reported timely.

When a mandatory unit member enters the household and the unit fails to report the change timely, calculate the overpayment starting with the month the mandatory unit member arrives.

When a mandatory unit member leaves the household and the unit fails to report the change timely, if the agency could have reduced or terminated assistance for 1 or more payment months had a delay in reporting the change not occurred, determine whether timely notice could have been issued on the day that the change occurred. Determine the correct benefit amount beginning with the 1st month in which you could have given timely notice.


Subtract the benefit the unit should have received for the payment month from the actual MFIP issued.

Subtract the full benefit amount the unit should have received (disregard any recoupment previously deducted) from the full benefit amount the unit actually received (disregard any recoupment previously deducted) for each month in the overpayment period. The difference is the overpayment amount.

NOTE:
The housing subsidy deduction reduces only the cash portion of the MFIP grant. See 0017.15.99 (Housing Subsidy). When determining the correct overpayment amount, do NOT use the housing subsidy to reduce the food portion of the benefit amount.

If the client refuses to provide information to establish the amount of the overpayment and if no information is available to estimate a claim amount, assign an overpayment for the full amount of MFIP issued for the period in question.

Notify the client of the right to provide proof to establish a smaller overpayment. Close the case if it is not possible to establish current eligibility.


DWP:

Follow general provisions. In addition, do not establish an overpayment or underpayment if the determination of the DWP grant amount is based on the best information available at the time of approval, even when there is additional income to the family unit. See 0022.12 (How to Calc. Benefit Level – MFIP/DWP/GA).


SNAP:

Do not establish an overpayment or underpayment because of changes that were not required to be reported by the unit during the certification period. However, for any reported change, take appropriate action. See 0007.15.03 (Unscheduled Reporting of Changes - SNAP).

When calculating overpayments or underpayments for SNAP, use the amount of cash assistance actually received in the payment month even if the cash assistance was later determined to be an overpayment.

Do not allow the work expense deduction on income not reported timely. Timely reporting means that required changes be reported by the 10th of the month following the month of the change.


CALCULATING AN OVERPAYMENT


Determine whether the unit IS or is NOT categorically eligible for SNAP:

If the SNAP unit IS categorically eligible, they are subject to the budgeting provisions that were in place at the time of the overpayment. See 0013.06 (SNAP Categorical Eligibility/Ineligibility), 0022.09.03 (When to Switch Budget Cycles - SNAP).

For overpayments that occurred PRIOR to 03-01-09: If the SNAP unit is NOT categorically eligible, they must meet prospective eligibility requirements. If the overpayment is caused by unreported income, the unit remains in retrospective budgeting unless there are 2 or more consecutive months of ineligibility. If there are 2 or more consecutive months of ineligibility, the case would be presumed closed. Switch the unit to prospective budgeting and presume that the unit reapplied on the 1st day they were eligible. Calculate the amount the unit should have received based on the 1st day they were eligible. See 0022.03.01 (Prospective Budgeting - Program Provisions).

For overpayments that occurred ON OR AFTER 03-01-09: Continue to budget all months prospectively. EXCEPTION: For Uncle Harry Food Support (UHFS) units, follow the instructions for determining overpayments that occurred prior to 03-01-09.


If the ineligibility is caused by any reason other than unreported income, and there is 1 month or more of total ineligibility and then 1 month or more of eligibility, presume that the unit reapplied on the 1st day they were eligible. Calculate the amount the unit should have received based on the 1st day they were eligible.


MSA:

Follow general provisions.

In addition, if the client receives SSI and SSA does not establish an overpayment or charge a partial overpayment, do not establish an MSA overpayment. For any month in which there is a total SSI overpayment, establish an MSA overpayment. If the total SSI overpayment is due to excess assets, the entire MSA benefit is an overpayment. If the total SSI overpayment is due to excess income, evaluate income to determine the amount of the MSA overpayment.

Do not allow the work expense deduction on income not reported timely. See 0018.06 (Work Expense Deductions).

For self-employment income overpayments that occurred after February 1, 2016, use the gross self-employment income calculation method for self-employment income not reported timely. See 0017.15.33.03 (Self-Employment, Convert Inc. To Monthly Amt).

When there is 1 month or more of total ineligibility and then 1 month or more of eligibility, presume that the unit reapplied on the 1st day they were eligible. Calculate the amount the unit should have received based on the 1st day of the month they were eligible.


GA:

Follow general provisions.

For self-employment income overpayments that occurred after February 1, 2016, use the gross self-employment income calculation method for self-employment income not reported timely. See 0017.15.33.03 (Self-Employment, Convert Inc. To Monthly Amt).

When there is 1 month or more of total ineligibility and then 1 month or more of eligibility, presume that the unit reapplied on the 1st day they were eligible. Calculate the amount the unit should have received based on the 1st day they were eligible. Prorate if necessary; see 0022.12.03 (Proration).


GRH:

No provisions.

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