CONNECTICUT DEPARTMENT OF SOCIAL SERVICES

CARE 4 KIDS CHILD CARE SUBSIDY PROGRAM

PROGRAM INTEGRITY METHODS

October 27, 2010

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CONNECTICUT DSS STAFF

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Michael P. Starkowski, Commissioner

Peter Palermino, State Administrator

Theresa Emery, Public Assistance Consultant

Don Beltrame, Public Assistance Consultant

Brian McGuiness, Investigation Supervisor

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

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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

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Connecticut Child Care Subsidy Program Organizational Chart

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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

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QC ERROR FINDINGS(1997-2003)

• Contractor error averaged 5% - 6%

• Client error averaged 15% - 18%

• Client error ranged as high as 23%

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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%)

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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%)

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QUESTIONS AND ANSWERSQUESTIONS AND ANSWERS

CORRECTIVE ACTIONSCORRECTIVE 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

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REGULATION AND PROCEDURE CHANGESREGULATION AND PROCEDURE CHANGES

• Payment for care based on:• A range of hours vs. strict per hour rates (e.g. half and full-

time)

• 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

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STAFF TRAINING AND DEVELOPMENTSTAFF 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

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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

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DATA MININGDATA 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

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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

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QUESTIONS AND ANSWERSQUESTIONS AND ANSWERS

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

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DSS QUALITY ASSURANCEDSS QUALITY ASSURANCEORGANIZATION CHARTORGANIZATION CHART

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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

FRED REFERRAL SOURCES

• 1-800 Fraud hotline• C4K contractor via automated system• DSS eligibility staff• Database matches• Other, i.e. special projects, provider referrals,

law enforcement agencies

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FRED PROCESS REFERRALS

Top 5 Targeted Error Prone Categories

• Self-employment

• Cash employment

• Questionable household composition

• 2nd & 3rd shift work hours

• Young Male Providers

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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

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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

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

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ACAP ACTIVITY 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

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FRED/ACAP PARTNERSHIPSFRED/ACAP PARTNERSHIPS

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QUESTIONS AND ANSWERSQUESTIONS AND ANSWERS

FOR MORE INFORMATION CONTACT:

CT Child Care Subsidy Program – Child Care Team:Peter Palermino – (860) 424-5006Peter.Palermino@ct.gov

Don Beltrame (860) 424-5363Don.Beltrame@ct.gov

Office of Quality Assurance - Fraud & Recoveries Division:Stephen J. Markowski (860) 424-5954Stephen.Markowski@ct.gov

Brian McGuiness (860) 424-5955Brian.McGuiness@ct.gov

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