AB 535

This bill establishes an optional program that provides incentives in the form

of reward payments to counties and tribes for identifying fraud in certain public

assistance programs.

Under current law, a county or an elected governing body of a federally

recognized American Indian tribe or band (tribe) may retain a portion of incorrect

overpayments in public assistance programs administered by the Department of

Health Services (DHS), including Medical Assistance (MA) and the supplemental

nutrition assistance program (known as FoodShare in Wisconsin), that are recovered

as the result of the efforts of an employee or officer of the county or tribe.

Under one provision in current law, a tribe or county other than Milwaukee

County may retain the portion of a recovered amount that is specified by rule by

DHS. This provision applies to any public assistance program administered by DHS.

Under another provision that applies only to MA, a county or tribe may retain 15

percent of recovered MA funds that were incorrectly provided as a result of

fraudulent activity by a recipient or provider. Under another provision that applies

only to MA, a tribe or county other than Milwaukee County may retain 15 percent

of recovered MA funds that were incorrectly provided as a result of misstatements

or omissions of fact or failures to provide information by an applicant or recipient or

another person providing information on behalf of an applicant or recipient. Under

a provision that applies only to FoodShare, DHS establishes by rule the portion of

overpayment recoveries that a tribe or a county other than Milwaukee County may

retain. In this latter provision, the bill changes the amount of a FoodShare

overpayment recovery that a county or tribe may retain to the full amount of the

overpayment recovery that the state is permitted to retain under federal law.

Under the bill, DHS is required to establish an optional incentive program, by

rule, under which a county with a population of less than 750,000, which excludes

Milwaukee County, or a tribe receives a reward payment if an employee or officer of

the county or tribe identifies suspected fraudulent activity in MA or FoodShare and

the county or tribe determines the fraudulent activity occurred, establishes a claim

for any overpaid benefits related to the fraudulent activity, and, if directed by DHS,

criminally prosecutes the fraudulent activity. Under the bill, the amount of the

reward payment under the program is 20 percent of the amount that DHS

determines will be saved in the program over a 12-month period as the result of

eliminating the identified fraudulent activity. The bill also provides that, if a county

or tribe chooses to receive a reward payment under the optional incentive program,

the county or tribe may not also retain 15 percent or any other portion of recovered

MA or FoodShare overpayments that were made as a result of the identified

fraudulent activity. The bill does not, however, affect a county or tribe's eligibility

to retain a recovered overpayment that was made as the result of a recipient's

nonfraudulent error.