Ventura County 08/09

VENTURA COUNTY HUMAN SERVICES AGENCY Audit Report CASH ASSISTANCE PROGRAM FOR IMMIGRANTS (CAPI) July 1, 2006, through June 30, 2007 J C OHN HIANG California State Controller August 2009 J C OHN HIANG California State Controller August 28, 2009 CERTIFIED MAIL—RETURN RECEIPT REQUESTED Barry L. Zimmerman, Director Ventura County Human Services Agency 855 Partridge Drive Ventura, CA 93003 Dear Mr. Zimmerman: The State Controller’s Office audited the Ventura County Human Services Agency’s costs claimed for active Cash Assistance Program for Immigrants (CAPI) beneficiaries for the period July 1, 2006, through June 30, 2007. The county claimed and was paid $1,036,430 for the CAPI Program. Our audit disclosed that the county did not maintain records to support $141,916 of reported overpayments. As a result, a portion of CAPI overpayments recovered has likely remained unrecognized, resulting in the county overclaiming state funds. In addition, the county did not appropriately refer 3 of the 20 sampled aged beneficiaries designated as Aid Code 1A to the Social Security Administration (SSA). Beneficiaries in Aid Code 1A represent qualified non-citizens who entered the United States prior to August 22, 1996, and who are age 65 or older. The county provided cash assistance to 91 Aid Code 1A beneficiaries. Had the county properly referred the beneficiaries in this Aid Code who were disabled or blind to the SSA for disability- or blind-based SSI/SSP benefits, the State might have avoided $52,365 of its General Fund obligations. We did not expand our examination to the remainder of the Aid Code 1A beneficiaries. If our sampling technique was statistically representative, we estimate there could be $300,000 in additional overpayments. Barry L. Zimmerman, Director -2- August 28, 2009 We issued our draft report for this audit on April 30, 2009. We received the county’s response concerning our draft report on May 22, 2009, partially agreeing with the audit results. This final report includes the county’s response and our comments to the responses. If you have any questions, please contact Les Lombardo, Chief, Special Audits Bureau, at (916) 323-1770. Sincerely, Original signed by JEFFREY V. BROWNFIELD Chief, Division of Audits JVB/wm:vb Attachment cc: Paul Bujold, Program Manager Ventura County Human Services Agency The Honorable Christine L. Cohen Ventura County Auditor-Controller Sharon Nieman, External Audit Coordinator California Department of Social Services Ventura County Human Services Agency Cash Assistance Program for Immigrants (CAPI) Contents Audit Report Summary ............................................................................................................................ 1 Background ........................................................................................................................ 1 Objectives, Scope, and Methodology ............................................................................... 2 Conclusion .......................................................................................................................... 3 Views of Responsible Official ........................................................................................... 3 Restricted Use .................................................................................................................... 4 Schedule 1—Summary of Beneficiary Case Files Reviewed .............................................. 5 Findings and Recommendations ........................................................................................... 6 Attachment—County’s Response to the Draft Audit Report Ventura County Human Services Agency Cash Assistance Program for Immigrants (CAPI) Audit Report Summary The State Controller’s Office (SCO) audited the Cash Assistance Program for Immigrants (CAPI) benefits paid and claimed by the Ventura County Human Services Agency for the period of July 1, 2006, through June 30, 2007. The county claimed and was paid $1,036,430 for the CAPI Program. Our audit disclosed that the county did not maintain records to support $141,916 of reported overpayments. As a result, a portion of CAPI overpayments recovered has likely remained unrecognized, resulting in the county possibly overclaiming state funds. In addition, the county did not appropriately refer 3 of the 20 sampled aged beneficiaries for Aid Code 1A to the Social Security Administration (SSA). Beneficiaries in Aid Code 1A represent qualified non-citizens who entered the United States prior to August 22, 1996 and who are age 65 or older. The county provided cash assistance to 91 Aid Code 1A beneficiaries. Had the county properly referred the beneficiaries in this Aid Code who were disabled or blind to the SSA for disability- or blind- based SSI/SSP benefits, the State might have avoided $52,365 of its General Fund obligations. Background Prior to the federal Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (P.L. 104-193), non-citizens along with citizens were eligible to receive the SSI/SSP benefits. P.L. 104-193 eliminated SSI/SSP eligibility for most non-citizens. In order to allow non-citizens to continue receiving public assistance, California lawmakers enacted Assembly Bill (AB) 2779, Chapter 329. The new law established a 100% state-funded Cash Assistance Program for Immigrants (CAPI) by adding sections 18937 through 18944 to the Welfare and Institutions Code, effective October 1, 1998. These statutes provide that the California Department of Social Services (CDSS) must establish a county or county consortia-administered program to provide cash assistance to aged, blind, and disabled legal immigrants who meet the SSI/SSP immigration status requirements in effect on August 21, 1996, and all other SSI/SSP eligibility requirements in effect. On July 22, 1999, AB 1111 and Senate Bill (SB) 708 were signed into law. These bills extended and expanded the CAPI program. AB 1111 extended the program indefinitely and exempted the sponsor’s source of income for immigrants who are victims of abuse by their sponsor or sponsor’s spouse. Furthermore, this bill established a time-limited CAPI eligibility for new entrants, those who entered the United States on or after August 22, 1996, but who do not have a sponsor, or have a sponsor who does not meet the sponsor restrictions for new entrants, but meet all CAPI eligibility requirements. New entrants were eligible for benefits from October 1, 1999, through September 30, 2000. Subsequently, the time-limited CAPI was extended for another year. AB 429 (Chapter 111, Statutes of 2001) eliminated the sunset date for time-limited CAPI eligibility. -1- Ventura County Human Services Agency Cash Assistance Program for Immigrants (CAPI) For immigrants eligible for time-limited CAPI benefits, SB 708 changed the sponsor deeming period to five years regardless of which Affidavit of Support the sponsor signed. The five-year sponsor deeming process starts from the date the sponsor executed the affidavit or the date of the immigrant’s arrival in the United States, whichever is later. AB 429 extended the sponsor deeming to a ten-year period for CAPI applicants who entered the United States on or after August 22, 1996, and who do not meet sponsor restrictions as defined for Aid Code 6M, as shown below. CDSS requires each participating county to provide monthly and quarterly reports for CAPI caseloads and payments. CDSS requires that CAPI cases be identified and reported under the following Aid Codes: • 1A: Non-citizens who entered the United States prior to August 22, 1996, meet the federal definition of Qualified Alien, and who are age 65 or older. • 6K: Non-citizens who entered the United States prior to August 22, 1996, and meet the previous federal Permanent Residence Under Color of Law requirements, but not the Qualified Alien requirements. • 6M: Sponsored immigrants who entered the United States on or after August 22, 1996, and the sponsor is deceased or disabled, or the immigrant is a victim of abuse either by the sponsor or sponsor’s spouse. • 6T: Previously time-limited, but now extended, CAPI. Non-citizens who entered the United States on or after August 22, 1996, who do not meet the sponsor restrictions in the definition of Aid Code 6M and who meet either the federal definition of Qualified Alien or the previous federal definition of Permanent Resident Under Color of Law. Federal and State regulations that govern the SSI/SSP program govern CAPI eligibility. Payment amounts to recipients are $10 less than the corresponding SSI/SSP payment standards. Once eligible, the law provides for periodic redeterminations. CDSS has established eligibility and assistance standards for the CAPI program. Participating counties and consortia administer the program. On a monthly basis, counties submit invoices to CDSS to seek reimbursement for the monthly payments to beneficiaries. Objectives, Scope, We conducted the audit to determine if the funds disbursed by the State and expended by the county for the CAPI program were in accordance and Methodology with the policies and procedures prescribed by CDSS. We reviewed the cash payments awarded to active beneficiaries for the period of July 1, 2006, through June 30, 2007. Eligibility, redetermination, and cash payments were reviewed from eligibility inception. Our scope included, but was not limited to, determining whether cash benefits claimed were supported by appropriate county records. -2- Ventura County Human Services Agency Cash Assistance Program for Immigrants (CAPI) We conducted this performance audit pursuant to our audit authority under Government Code section 12410 and in accordance with generally accepted governmental auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives. We limited our audit scope to planning and performing audit procedures necessary to obtain reasonable assurance that benefits paid and claimed were in accordance with CDSS program guidelines. Accordingly, we examined transactions, on a test basis, to determine whether the costs claimed were supported. We restricted our review of the internal controls to gaining an understanding of the CAPI transaction flow and claim preparation process as necessary to develop appropriate auditing procedures. Conclusion The county claimed and was paid $1,036,430 for the CAPI program. Our audit disclosed that the county did not maintain records to identify $141,916 of reported overpayment. As a result, a portion of CAPI overpayments recovered has likely remained unrecognized, resulting in the county overclaiming the state funds. In addition, the county did not appropriately refer 3 of the 20 sampled beneficiaries reviewed for Aid Code 1A to the SSA. Had the county referred the beneficiaries in Aid Code 1A who were disabled or blind to the SSA for disability- or blind-based SSI/SSP benefits, the State might have avoided $52,365 of its General Fund obligation. We did not expand our examination to the remainder of the Aid Code 1A beneficiaries. If our sampling technique was statistically representative, we estimate that there could be $300,000 in additional overpayments. The estimated overpayments would result from the county not being aware that it should refer qualified beneficiaries to the SSA. However, because the SSA will only reimburse the county for beneficiaries from the time the SSA is notified, the county cannot seek recovery for these past overpayments. Thus, instead of reviewing past cases for potential overpayments, we recommend that the county take immediate action to review all Aid Code 1A case files and refer qualified beneficiaries to the SSA. Views of We issued a draft audit report on April 30, 2009. Barry Zimmerman, Director, Ventura County Human Services Agency, responded by letter Responsible dated May 22, 2009 (Attachment), partially agreeing with the findings. Official This final report includes the county’s response. Information identifying personal information about beneficiaries has been deleted from the response. -3- Ventura County Human Services Agency Cash Assistance Program for Immigrants (CAPI) Restricted Use This report is solely for the information and use of the Ventura County Human Services Agency, the Ventura County Auditor-Controller, the California Department of Social Services, and the SCO; it is not intended to be and should not be used by anyone other than these specified parties. This restriction is not intended to limit distribution of this report, which is a matter of public record. Original signed by JEFFREY V. BROWNFIELD Chief, Division of Audits August 28, 2009 -4- Ventura County Human Services Agency Cash Assistance Program for Immigrants (CAPI) Schedule 1— Summary of Beneficiary Case Files Reviewed July 1, 2006, through June 30, 2007 Sample Item Aid Code Client Case Number Allowable Benefits Unallowable Benefits1 1 1A C753761 $ 12,076 $ — 2 1A 1B06V00 — 7,016 3 1A B765191 12,527 — 4 1A B531534 15,027 — 5 1A B765241 — 30,074 6 1A B770154 6,877 — 7 1A B560523 15,372 — 8 1A B611704 15,555 — 9 1A B511267 3,691 — 10 1A C531191 15,168 — 11 1A B740820 1,758 — 12 1A 1B009192 — 15,275 13 1A C566868 16,801 — 14 1A B725171 16,572 — 15 1A B732197 21,920 — 16 1A C516579 18,566 — 17 1A C611275 15,390 — 18 1A B567224 18,340 — 19 1A B522035 16,572 — 20 1A C519118 21,920 — 21 6K B618729 16,640 — 22 6K B236308 19,287 — 23 6M B270436 15,320 — 24 6T C719898 12,272 — 25 6T B738162 13,748 — 26 6T B523269 19,212 — 27 6T 1B04736 10,925 — 28 6T C566728 21,920 — 29 6T 1B01P62 14,953 — 30 6T B532602 15,164 — 31 6T 1B00481 16,572 — 32 6T B756796 15,716 — 33 6T B522428 19,641 — 34 6T 1B02N06 16,033 — 35 6T B765276 26,574 — 36 6T B532637 12,501 — 37 6T B514137 16,571 — 38 6T B737240 5,743 — 39 6T C520417 17,784 — 40 6T B344468 20,722 — Total $ 571,430 $ 52,365 Total benefits paid $ 623,795 __________________________ 1 See the Findings and Recommendations section, Finding 2. 2 Corrected client case number (incorrectly listed in draft report as B754625). -5- Ventura County Human Services Agency Cash Assistance Program for Immigrants (CAPI) Findings and Recommendations FINDING 1— As of June 30, 2007, the county reported $141,916 in overpaid benefits to the California Department of Social Services (CDSS). This amount Unsupported and represents net overpaid benefits to individual recipients from program excessive overpayments inception to the end of FY 2006-07. The county recovered $13,483 in overpaid benefits during FY 2006-07. The county, however, has been unable to substantiate the reported overpaid benefits. As of June 2006, the county has converted all of its public assistance data to the CalWIN System. While all case file data have been converted, the county appears to be in a process of updating its collection system, Ventura Automated Collection System (VACS), for overpaid aid. The VACS system does not have the capacity to interface with the CalWIN system. Differences noted above may be due in part to the data conversion. However, the county has been unable to provide records that would substantiate the actual overpaid benefits as of the end of the FY 2006-07. We also compared the reported cash collected during each quarter, line 13, SOC Form 808, with quarterly receipts. For all months, reported receipts disagreed with actual receipts. County personnel were unable to substantiate and explain the differences. The recoveries per county records agreed with the reported recoveries per Form CA 800 CAPI. While the Form CA 800 CAPI appears to include correct data, it appears that the quarterly report contains inaccurate and unsupported information. Furthermore, the county appears to have a substantial amount of overpaid benefits. Initial eligibility and benefit amounts were determined properly. The overpaid aid seems to have resulted from the county not identifying in a timely manner ineligibility and excess payments for CAPI clients after the initial determination. During the required subsequent annual redeterminations, the county computed updated benefits (per information from Form SOC 804, questions 1 through 6) that showed an increase in beneficiary resources, or program ineligibility, which resulted in a reduction of CAPI benefits. Examples of benefit reduction include beneficiary failure to provide timely notice to the county when away from the county or state for more than 30 days, or a change of address that resulted in a change in the beneficiary’s financial status. Information from the redeterminations was applied retroactively. Pursuant to All County Letter 00-73, counties or consortia are required to track and report overpayment data for the CAPI program. Pursuant to All County Letter 99-106, the CDSS requires annual redetermination to assess a beneficiary’s continued eligibility and benefit amount. -6- Ventura County Human Services Agency Cash Assistance Program for Immigrants (CAPI) Recommendation The county has begun its process of identifying unrecovered overpaid benefits. However, we recommend that the county implement policies and procedures to ensure that all future overpayments are properly tracked and accurately reported to CDSS. We also recommend that CDSS consider frequent, rather than annual redeterminations. Doing so would allow the county to detect and recover overpayments in a timely manner. County’s Response We concur with your findings and recommendations regarding overpayments not being tracked, and the lack of adequate policies to track overpayments. We have currently changed our processes, and all CAPI overpayments have been entered into Ventura Automated Collection System (VACS), which is the Agency’s collection system. In addition, we are in the process of revising policies and procedures to ensure overpayments are tracked and accurately reported. However, we do not concur with the determined overpayment amount indicated in the report. We continue to make efforts to determine the actual overpayment that should be identified and reported. SCO’s Comment The finding remains unchanged. The county agrees that overpayments were not being tracked and that it lacked adequate policies to track overpayments. The county has begun reviewing the historical data in the hopes of determining the actual overpayments. Once determined, the county will take necessary action to adjust the overpayments reported to CDSS. FINDING 2— For fiscal year (FY) 2006-07, the county provided cash benefits to Overclaimed CAPI 167 individuals (91 for Aid Code 1A, 2 for Aid Code 6K, 3 for Aid Code 6M, and 71 for Aid Code 6T). We selected a sample of 40 case benefits files to determine eligibility and benefit amounts. We tested 20 case files for Aid Code 1A, 2 case files for Aid Code 6K, 1 for Aid Code 6M, and 17 case files for Aid Code 6T. From initial eligibility through the end of our fieldwork date, May 8, 2008, the county awarded a total of $623,795 to sampled beneficiaries. Of the 40 case files reviewed, we questioned eligibility for 3 beneficiaries. For these individuals, from their initial eligibility through May 8, 2008, the county awarded $52,365 in cash benefits, a potential overpayment of approximately 8%. During required annual redeterminations, the county did refer these individuals to the Social Security Administration (SSA). However, the referrals were not for disability-based benefits. SSA denied the request for SSI/SSP assistance, stating that the beneficiaries were non-citizens and, thus, were not qualified. Had the county properly referred these beneficiaries in this Aid Code who were disabled or blind to the SSA for the disability- or blind-based SSI/SSP benefits, $52,365 of CAPI benefits might have been avoided. -7- Ventura County Human Services Agency Cash Assistance Program for Immigrants (CAPI) Pursuant to All County Information Notice I-05-01, qualified aliens who were lawfully residing in the United States on August 22, 1996, and who are determined disabled or blind as defined for SSI/SSP eligibility purposes, are eligible for SSI/SSP benefits. We did not expand our examination to the remainder of the Aid Code 1A beneficiaries. If our sampling technique was statistically representative, we estimate that there could be $300,000 in additional overpayments. The estimated overpayments would result from the county not being aware that it should refer qualified beneficiaries to the SSA. However, because the SSA will only reimburse the county for beneficiaries from the time the SSA is notified, the county cannot seek recovery for these past overpayments. Thus, instead of reviewing past cases for potential overpayments, we recommend that the county take immediate action to review all Aid Code 1A case files and refer qualified beneficiaries to the SSA. Recommendation We recommend the county take immediate action to refer these cases to the SSA for disability-based benefits. In addition, we recommend the county provide resources and training to its eligibility workers so they can correctly interpret and apply the CDSS established CAPI guidelines. We also recommend the county review the non-sampled case files, identify applicants who have subsequently become disabled, and refer them to SSA for disability-based SSI/SSP benefits. County’s Response The cases identified in the report have been reviewed, and we’ve come to the conclusion that the findings are not accurate. The conclusions are based on the following information: Sample Item #2 / Case Number 1B06V00 – Listed as a 1A category with unallowable benefits totaling $7,016 – Attachment (1) This case has an application dated 11/22/2006, and was approved on 03/07/2007, with an effective beginning date of 02/01/2007. Through a concurrent Medi-Cal Application, the client clarified that she did not have a blindness, disability, or incapacity. In addition, the client provided a formal SSI denial dated 02/23/2007, and SSA listed the client as an aged individual. Also, on 02/04/2008, the client was referred to Social Security to file a formal application for Medicare Parts A and B. Social Security listed the client as an aged individual, not disabled. On 03/25/2008, the client was referred to Social Security to make a formal application for disability based SSI and the client was listed as an aged individual. In August 2008, the client was approved for SSI due the client becoming a United States Citizen and was listed as an aged individual. -8- Ventura County Human Services Agency Cash Assistance Program for Immigrants (CAPI) Sample Item #5 / Case Number B765241 – Listed as a 1A category with unallowable benefits totaling $30,074 – Attachment (2) On 10/01/2004, this case was approved with an effective begin date of 08/01/2004. The client provided a formal SSI denial dated 10/27/2003, and a subsequent SSI denial dated 09/28/2004. Social Security found that the individual was not disabled, and listed the client as an aged individual. In addition, on 10/27/2005, and 06/04/2007, the client declared that she did not have a blindness, disability, or incapacity. The client was referred to SSA on 03/25/2005, and 06/10/2008, to make a formal application for disability based SSI. Once again, as a result of the referral, the client was categorized as an aged individual and denied on 04/04/2008, and 09/08/2008. Sample Item #12 / Case Number B754625 – Listed as an Aid Code 1A with unallowable benefits totaling $15,275 – Attachment (3) This case is not a 1A category; it is a 6T category, as the beneficiary has an INS Entry Date of 01/19/2000. The application date for this case is 02/14/2006; on 02/06/2006, the SSA properly denied the applicant and listed the client as an aged individual. Based on the recommendation to review the accuracy of all Aid Code 1A case files we conclude that the case sample does not validate the estimated additional overpayment amount you are indicating. SCO’s Comment The finding remains unchanged. The county disagreed with the individual cases questioned. For all cases, documentation contained in the eligibility case files did not substantiate individual beneficiaries being referred for the SSI/SSP benefits. For sample item 2, while we agree that in her concurrent Medi-Cal application, the beneficiary did not note blindness, disability, or incapacity, such form is not a basis upon which a CAPI beneficiary’s eligibility and redetermination are assessed. For redetermination, in accordance with the CDSS issued CAPI program guidelines, the beneficiaries apply for continued cash assistance by completing Form SOC 804, Statement of Facts for Determining Continuing Eligibility for the Cash Assistance Program for Immigrants (CAPI). Our review of the completed application revealed that the beneficiary had noted physical or mental health problem. For sample item 5, in the redetermination form SOC 804, the beneficiary noted physical and mental health problems. As required, the county did refer these beneficiaries for the SSI/SSP benefits. However, it appears that the beneficiaries did not disclose physical and mental health problems in their SSI/SSP application. Thus, SSA likely did not deem the applicants as having physical or mental health problems. Accordingly, the SSA denied consideration for the disability based SSI/SSP benefits. -9- Ventura County Human Services Agency Cash Assistance Program for Immigrants (CAPI) While the SSA and the State may differ in determining, evaluating, and deeming disability for physical and mental health problems, unless the applicant provides to the SSA the information it provides to the County, the SSA will likely deny the request for disability based SSI/SSP assistance. Thus, we recommend the county advocate that the beneficiaries provide SSA all factual information as they do for the CAPI assistance. As for sample item 12, the beneficiary case number was incorrectly noted. The beneficiary is indeed an Aid Code 1A beneficiary. The Schedule 1 has been corrected to note the related case number. As noted for the sample cases above, in the redetermination Form SOC 804, the beneficiary noted physical and mental health problems. Accordingly, the beneficiary should have been referred for the disability based SSI/SSP benefits. -10- Ventura County Human Services Agency Cash Assistance Program for Immigrants (CAPI) Attachment— County’s Response to Draft Audit Report State Controller’s Office Division of Audits Post Office Box 942850 Sacramento, CA 94250-5874 http://www.sco.ca.gov S08-SSI-002