UNDERPAYMENTS

Correct any underpayment discovered for a current benefit month within 7 calendar days following the discovery. Issue corrective payments for the current month without deducting any overpayments.

Apply restored benefits for a past month to existing RCA claims/overpayments and issue any remaining benefits to the current participant.

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


OVERPAYMENTS

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 is the difference between the benefit amount the client actually received and the benefit amount the client should have received. Overpayments, once computed, are set up as claims to initiate recovery from the client.

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

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 RCA 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.

For purposes of allowing the earned income disregard, a report is timely when the client or authorized representative reports income within 60 days from the month in which the income was received.


RCA CLAIMS

Overpayments are set up as claims to initiate recovery from the client. Recoupment is not automated at this time. Pursue recovery via voluntary repayment or civil recovery. Follow MFIP policy in 0025.21.06 (Civil Recovery).

RCA claims are subject to compromise. See 0025.12.03.09 (Claim Compromise & Termination).

In the VOLAG-administered program, the VOLAG Eligibility Coordinators determine the amount of the overpayment and enter the RCA claim. In the county-administered program the county financial workers will follow their county’s current procedures regarding entering and maintaining claims.

Judgment of Law (JOL) is not supported by statute for RCA overpayments. Do not send the Notice of Overpayment letter to the client using certified mail.

Recover all RCA overpayments, except for non-fraud overpayments on a closed case of $35 or less.

Discontinue all recovery actions against a participant who files Chapter 7 or Chapter 13 bankruptcy action and sends a notification of creditors to the agency.