CONNECTICUT DEPARTMENT OF SOCIAL SERVICES CARE 4 KIDS

CONNECTICUT DEPARTMENT OF SOCIAL SERVICES CARE 4 KIDS CHILD CARE SUBSIDY PROGRAM INTEGRITY METHODS October 27, 2010 1

CONNECTICUT DSS STAFF Michael P. Starkowski, Commissioner Peter Palermino, State Administrator Theresa Emery, Public Assistance Consultant Don Beltrame, Public Assistance Consultant Brian Mc. Guiness, Investigation Supervisor 2

AGENDA • Overview of Care 4 Kids Subsidy Program • History of Program Integrity Methods - Questions and Answers • Current Administrative Controls - Questions and Answers • Fraud Preventive Measures/Results - Questions and Answers 3

CONNECTICUT CHILD CARE SUBSIDY PROGRAM • Outsourced to Statewide R&R Agency, which determines eligibility, processes invoices, etc. • $100 Million Annual State/Federal Benefits • 22, 000 Kids/15, 000 Families Monthly • Applications - 1, 800/month • Redeterminations – 1, 250/month • 1, 400 licensed / 3, 500 unlicensed providers 4

Connecticut Child Care Subsidy Program Organizational Chart 5

DSS QUALITY CONTROL REVIEWS • Started QC reviews when subsidy program was outsourced in 1997 • Reviews parallel federal SNAP review process • Statistically valid sample of 100 cases per quarter • Measured contractor and client error 6

QC ERROR FINDINGS (1997 -2003) • Contractor error averaged 5% - 6% • Client error averaged 15% - 18% • Client error ranged as high as 23% 7

CONTRACTOR ERROR CATEGORIES/INCIDENCE (1997 – 2003) • • Income computed incorrectly or verified (38%) Family co-pay not deducted (13%) Reported or known changes not pursued (9%) Approved care hours not verified (8%) Ineligible provider arrangement approved (7%) School schedule overlapped care hours (5%) Incorrect household composition (5%) 8

CLIENT ERROR CATEGORIES/INCIDENCE (1997 -2003) • Unreported job loss/did not attend training (24%) • Misrepresentation of: – Work hours or shift (22%) – Income (4%) • Provider not available during care hours (15%) • Unreported: – Income (10%) – Spouse in household (6%) – Change in employment (5%) 9

QUESTIONS AND ANSWERS 10

CORRECTIVE ACTIONS • • Change regulations & procedures Enhance staff training and development Increase monitoring (DSS and Contractor) Mine data and expand access to other state databases • Develop fraud detection/prevention strategies 11

REGULATION AND PROCEDURE CHANGES • Payment for care based on: • A range of hours vs. strict per hour rates (e. g. half and fulltime) • Enrollment vs. actual attendance • • No change in co-payment between redeterminations Go paperless (document imaging) Increase utilization of third party verifications Amend vendor fraud statute to include child care providers and lifetime disqualification penalty • Mandate compliance with QA and Investigations 12

STAFF TRAINING AND DEVELOPMENT • Fund 2 full-time contractor training positions • Establish 3 month training program for newly hired staff • Increase use of policy transmittals, reminder bulletins and desk aids • Targeted training and refresher training of error prone categories 13

MONITORING • Greater coordination between DSS and contractor • Maintain an on-site presence • Corrective action planning meetings • Monthly desk reviews by contractor • Additional system edits • Annual audits by DSS Child Care Team and state auditor 14

DATA MINING • Unlicensed providers with: – Out-of-state residence – PO Boxes • Excessive care hours authorized • Number of children in care exceeds provider limit • Multiple providers reside at same address • System screen data not populated 15

DATABASE INTERFACES • Depts. of Labor, Motor Vehicle, Corrections dbases • DSS Public Assistance mainframe (EMS) • TANF E&T dbase • Child Support dbase and Paternity Registry • Child abuse/neglect data match • IRS/TIN data match • NAEYC data match • Licensed provider data match • Medicaid provider disability data match 16

QUESTIONS AND ANSWERS 17

FRAUD PREVENTION MEASURES AND RESULTS • FRaud Early Detection (FRED) unit created 2005: • Home visits and verification of information • Follow-up home-visits for error prone providers • Active Case Assessment Program (ACAP) unit created 2007 18

DSS QUALITY ASSURANCE ORGANIZATION CHART 19

FRAUD EARLY DETECTION (FRED) • Purpose – identify, investigate and determine errors before paying benefits. • Staff – 4 full-time non-law enforcement investigators and 1 unit supervisor • Complete 120 referrals/mo: 1, 421 in SFY 10 • Cost Avoidance –$4. 4 million SFY 10 –$15. 8 million SFY 08 -10 20

FRED REFERRAL SOURCES • • • 1 -800 Fraud hotline C 4 K contractor via automated system DSS eligibility staff Database matches Other, i. e. special projects, provider referrals, law enforcement agencies 21

FRED PROCESS REFERRALS Top 5 Targeted Error Prone Categories • Self-employment • Cash employment • Questionable household composition • 2 nd & 3 rd shift work hours • Young Male Providers 22

FRED PROCESS INVESTIGATION Investigation Steps: • Case reviews and contractor interviews • Database and Internet searches • Third party verification - landlords, employers, property records, banks, court records, etc. , • Field visit to home, work or child care site • Subpoena authority 23

ACTIVE CASE ASSESSMENT PROGRAM (ACAP) • Parallel to FRED but with active cases • Staff – 4 full-time non-law enforcement investigators and 1 supervisor • Investigate historical and current eligibility • Prepare Arrest Warrant Affidavit • Testify in court proceedings 24

ACAP ACTIVITY (2007 – 2009) • Completed 1, 220 investigations • 142 arrest warrant affidavits - 50 criminal convictions - 92 accelerated rehabilitation (AR) granted • 121 program disqualifications • $500, 000 cost avoidance in SFY 10 • $700, 000 recovered in SFY 10 25

ACAP ACTIVITY (cont. ) • #1 Priority is prosecution • $8, 450 - Avg. claim value • $136, 000 highest value case • Most adjudicated with full restitution • Lifetime disqualification if provider convicted or given A&R 26

FRED/ACAP PARTNERSHIPS 27

QUESTIONS AND ANSWERS 28

FOR MORE INFORMATION CONTACT: CT Child Care Subsidy Program – Child Care Team: Peter Palermino – (860) 424 -5006 Peter. Palermino@ct. gov Don Beltrame (860) 424 -5363 Don. Beltrame@ct. gov Office of Quality Assurance - Fraud & Recoveries Division: Stephen J. Markowski (860) 424 -5954 Stephen. Markowski@ct. gov Brian Mc. Guiness (860) 424 -5955 Brian. Mc. Guiness@ct. gov 29