16 Del. Admin. Code § 7000-7002

Current through Register Vol. 28, No. 7, January 1, 2025

Section 7000-7002 - Determining the Amount of Overpayments

An overpayment is a Cash Assistance payment made in excess of the amount a recipient is entitled to receive. Overpayments may be caused by client or agency error. In either situation, the recipient is expected to repay to DHSS the amount of benefits received in error. Repayment is based on the legal principle that when a person is paid benefits to which (s)he is not entitled, the payer has a right to recovery of those benefits.

All applicants for financial assistance will be informed of their responsibility to repay overpayments at application. They will be asked to sign the application which explains recipients' responsibilities to repay overpayments and outlines the methods by which overpayment debts can be recovered. 13 DE Reg. 1462 (05/01/10)

7002.1 Cash Assistance Overpayments

1) Technical Ineligibility (Non-financial reasons)

When an overpayment occurs because a recipient is technically ineligible for assistance, the overpayment equals the amount of the assistance grant paid.

For Example: Mrs. Jones receives assistance for herself and two children. Mrs. Jones goes on strike from her job and does not report this change to the Division. When the situation is discovered, the entire TANF payment is an overpayment.

If only some members of an assistance unit are technically ineligible, the amount of the overpayment is the difference between the actual grant the unit received and the grant that would have been issued to the remaining eligible unit members.

For overpayments based on technical ineligibility, the overpayment period begins the month following the month of the change. In the above example, if the parent went on strike in May and it was discovered in August, the overpayment would include TANF payments made to the unit from June until the month the grant amount correctly reflected the circumstances.

2) Financial Ineligibility

When an overpayment occurs because countable income or resources were not included in determining the assistance grant, the overpayment is the difference between the grant the unit received and the grant that would have been issued if the income had been budgeted.

A. Reported Income

1) Determine the unit's prospective eligibility at the time income began. Use all income that should have been included in the budget calculations. Income that was not counted (or counted incorrectly) due to agency error, is to have income disregards applied to determine the overpayment amount. See DSSM 4004.2, 4004.3, and 8028.

2) If the unit is determined prospectively ineligible, calculate the overpayment for each month using prospective budgeting. Include in the overpayment the month that the income began if the income received in that month exceeded the applicable Standard of Need.

3) If the unit would have remained eligible, calculate the overpayment for each month using retrospective budgeting, unless actual income recovered in a subsequent month makes the unit ineligible. In that case, budget the remaining months prospectively. This is for overpayments occurring prior to November 1, 1995.

4) Overpayments occurring after November 1, 1995 will be processed prospectively. The overpayment is to be processed prospectively regardless of whether the unit is totally ineligible for a benefit or if the unit is eligible for a partial benefit.

B. Unreported Income

1) Determine the unit's prospective eligibility at the time income began. Include all income that should be counted in the budget calculation. Do not allow income disregards on that income which was not reported. See DSSM 4004.2, 4004.3, and 8028.

2) If the unit is determined prospectively ineligible, calculate the overpayment for each month using prospective budgeting. Include in the overpayment the month the income began if the income received in that month exceeded the applicable Standard of Need.

C. Calculating Overpayments Resulting From Unreported Income

1) Determine the unit's prospective eligibility at the time the income began. Include all income that was actually counted in the budget calculation and any income that was not included in the calculation, but should have been.

NOTE: If income was not counted because of agency error, allow income disregards applicable to the client's assistance. If income was unreported, do not allow any disregards. See DSSM 4004.2, 4004.3, and 8028.

3) If the unit would have remained eligible, calculate the overpayment for each month using retrospective budgeting, unless actual income received in a subsequent month makes the unit ineligible. In that case, budget the remaining months prospectively. This is for overpayments occurring prior to November 1, 1995.

To illustrate, suppose a TANF recipient begins receiving income in January, and DSS is informed of the income in May. A budget is computed to determine prospective eligibility for February, and the unit is found ineligible for February benefits. February is the first month of the overpayment period, and the overpayment amount for each month is determined using prospective budgeting. January could also be included in the overpayment period if the income actually received in January exceeded the applicable Standard of Need.

D. Offsetting Overpayments

When DSS discovers that a cash assistance client has been underpaid, the underpayment must be offset by any existing overpayment debt that was incurred in the same category of assistance. Once the offset has been made, any remaining underpayment is restored to the recipient. To calculate the offset, ARMS will determine if any prior overpayments exist and subtract the outstanding overpayment amount from the underpayment amount.

For example, Mrs. Jones has an outstanding TANF overpayment debt of $200. Later, DSS discovers that Mrs. Jones was underpaid $250 in TANF benefits. The underpayment amount ($250) is offset with the outstanding debt ($200) and a restoration of $50 is issued to Mrs. Jones by ARMS.

In these situations, the new overpayment balance must be entered in DCIS by ARMS to ensure that recoupment continues properly, if applicable.

E. Procedure For Benefit Restoration

To restore benefits, prepare a Form 106, Benefit Restoration/Underissuance Form. Form 106 should contain signatures of the worker completing the document, the Pool Supervisor, and the respective Operations Administrator. Forward Form 106 to ARMS/Accounting Section.

Do not include any current month's benefits in the restoration, as the current month's benefits can be issued by the DSS local office. Local offices, however, are not to issue any benefits for a previous month(s).

Benefit restorations, like all other overpayments, are then submitted to ARMS. ARMS researches their overpayment records for outstanding overpayments and makes any necessary adjustments to the recoupment balance as a result of the offsetting process.

The Form 106 is then post-audited by the DMS/Client Payments Section.

F. Exceptions To Repayment To DSS

For cases where TANF recipients retain child support payments assigned to the State and DCSE has established a support order, the DCSE will file a claim, obtain a debt acknowledgment, and establish a repayment agreement with the indebted recipient.

13 DE Reg. 1462 (05/01/10)

7002.2 Food Stamp Claims

Repealed

13 DE Reg. 1462 (05/01/10

7002.3 Criteria for Establishing Inadvertent Household and Administrative Error Claims

Repealed

13 DE Reg. 1462 (05/01/10

7002.4 Calculating Food Stamp Claims

Repealed

13 DE Reg. 1462 (05/01/10

16 Del. Admin. Code § 7000-7002