Sec. 07.02.11.35. Correction of Payment Irregularities to the Out-of-Home Placement Provider

A. Within 30 days of the knowledge of payment irregularity, the local department shall commence overpayment procedures.

B. Overpayment Procedures.

(1) To correct an overpayment, the local department shall:

(a) Determine the correct payment amount and take action to correct the continuing payment;

(b) Calculate the total amount of the overpayment; and

(c) Notify the provider in writing of the suspected overpayment amount within 10 days after determining that an overpayment exists.

(2) The local department may not recoup an overpayment from a provider until the local department has notified the provider in writing that an overpayment has been identified.

(3) The local department may propose to reduce, suspend, or terminate payment to correct the overpayment.

(4) The provider may request a fair hearing to challenge the proposed action.

(5) If the local department's decision following a fair hearing is upheld, the proposed reduction, suspension, or termination of the overpayment includes any overpayment made pending the decision.

C. Termination of payment does not relieve the provider of the obligation to reimburse the local department for any overpayment.

D. To obtain reimbursement, the local department shall:

(1) Request repayment of the overpayment; and

(2) If appropriate, initiate collection efforts in conformity with the procedure required to refer the debt to the Central Collection Unit, Department of Budget and Management.

E. If payment to the provider is subsequently reinstated, the local department shall recoup the amount of the overpayment as prescribed in §I of this regulation.

F. If a person repays the local department, the local department shall accept and credit the payment.

G. Fair Hearing.

(1) Before the local department takes action to recover or recoup an overpayment, the local department shall advise the provider of the:

(a) Right to a fair hearing; and

(b) Procedure and time limit for requesting a fair hearing according to Regulation .38 of this chapter and COMAR 07.01.04.

(2) The provider may request a fair hearing to challenge the:

(a) Decision of the local department that an overpayment occurred;

(b) Amount or cause of the overpayment; or

(c) Proposed method to repay the overpayment.

(3) Within 30 days following a fair hearing, the Office of Administrative Hearings shall notify the individual in writing of the:

(a) Agency decision; and

(b) Reasons for the decision.

H. Suspected Fraud Procedures.

(1) If the local department determines that a case is one of suspected fraud as defined in Regulation .03B of this chapter, the local department shall refer the case to the:

(a) The Department's Office of the Inspector General (OIG); or

(b) State's attorney's office (SAO).

(2) Before the local department refers a case to the (OIG) or SAO, the referral document shall be approved by a supervisor or the director's designee.

(3) After making the referral, the local department:

(a) Shall inform the OIG or the SAO of any new facts or changed circumstances in the case;

(b) Shall provide access to relevant information in its possession to the assigned investigators; and

(c) May not notify a provider of the referral to the OIG or the SAO but may answer "yes" or "no" when the provider asks whether a referral was made.

I. Recoupment Procedures.

(1) Recoupment.

(a) Except as noted in §I(1)(b) of this regulation, the local department shall take action to recoup an overpayment and determine with the provider:

(i) The total amount to be recouped; and

(ii) An amount to be recouped through a monthly deduction from the continuing payment for as many months as are necessary until the overpayment is repaid.

(b) In the case of foster care providers, the amount recouped may not reduce the personal needs allowance by more than 50 percent of the monthly foster care payment rate.

(2) Procedures for Dual Jurisdictions. When a provider moves from one local department jurisdiction to another, the:

(a) Forwarding local department shall notify the receiving local department of the recoupment process; and

(b) Receiving local department shall continue the recoupment process, if appropriate, and credit all money recouped to the program funding source according to the Department's instructions.