Department of Health and Human Services
Departmental Appeals Board
QUALITY CONTROL REVIEW PANEL
SUBJECT: Wisconsin Department
of Health and Social Services
Docket No. A-94-113
Decision No. QC67
DATE: June 30, 1994
DECISION
The Wisconsin Department of Health and Social Services
(Wisconsin)
appealed a March 7, 1994 quality control (QC)
determination by the Regional
Administrator of the
Administration for Children and Families (ACF).
ACF
determined that Wisconsin's state QC review had erred in
finding
that I.M. had received an overpayment of $232 in
her Aid to Families with
Dependent Children (AFDC) grant
during the review month.
1/ ACF determined that
Wisconsin incorrectly calculated the
overpayment amount
and that the actual overpayment amount in I.M.'s grant
was $375. Wisconsin agreed that there had been a
calculation error
in the amount of I.M.'s grant, but
determined that, after a review of I.M.'s
case situation,
I.M.'s case should be dropped from the quality control
sample.
Thus, the dispute between the parties is not the proper
amount of I.M.'s
AFDC grant, but whether I.M.'s case
should be included in the QC
sample. For the reasons
discussed below, we find that ACF was correct
that the
case of I.M. should not be dropped from the QC sample.
Applicable Authority
Section 408(a) of the Social Security Act (Act) provides:
In order to improve the accuracy of payments of
[AFDC], the
Secretary shall establish and operate a
quality control system under which
the Secretary
shall determine, with respect to each State, the
amount
(if any) of the disallowance required to be
repaid to the Secretary due to
erroneous payments
made by the State in carrying out the State plan
approved under this part.
Further, the Act requires each state to review a sample
of cases in which
AFDC payments were made during the
review
period in order to determine the level of
erroneous payments. The Act
then provides that the
Secretary shall review a subsample of the cases
reviewed
by a state, and notify the state of any case in the
subsample
which the Secretary finds involves an erroneous
payment. See section
408(b)(1)(A) of the Act.
Regulations provide that a state agency in the operation
of its QC system
shall follow the "policies and
procedures prescribed in the Quality Control
Manuals
issued by the Department [of Health and Human Services]."
45
C.F.R. � 205.40(b)(1).
In regard to the practice of dropping a case from the QC
sample, section
3200 of the Quality Control Manual (QCM)
states, in relevant part:
Occasionally, a reviewer will find that he/she
cannot complete a
case review because of
circumstances which makes it impossible to obtain
enough information to render an eligibility and/or
payment
determination. If a review is not
completed, the case must be dropped
from the sample.
* * * *
After the reviewer has verified as many elements as
possible,
he/she completes or drops the case
according to the following criteria:
* * * *
2. If evidence to verify all the elements cannot be
obtained,
and no eligibility error has been
identified, the case must be
dropped. A finding
of correctly paid, overpaid or underpaid cannot
be made unless all elements can be verified
because the effect of
unverified elements on the
sample month's payment is unknown.
Thus, in order to prevail here and have I.M.'s case
dropped from the QC
sample, Wisconsin must demonstrate
that it was unable to verify a necessary
element of
I.M.'s case.
Factual Background
I.M.'s assistance unit (AU) consisted of herself and her
three
children. When her case was selected for review by
the Wisconsin state
QC review, the state reviewer found
that I.M. had not reported income she
had earned from a
job during the review month of October 1992. The
state
reviewer determined that I.M.'s AFDC grant was overpaid
$232
during the review month as a result of the
unreported income. When ACF
reviewed I.M.'s case, it
determined that the Wisconsin QC review incorrectly
calculated the overpayment amount and that the actual
overpayment was
$375.
Wisconsin admitted that its QC review had made a
mathematical error and
that ACF's re-calculation of the
error amount was correct, but then argued
that I.M.'s
case should be dropped from the QC sample because the
review
also had produced contradictory evidence about
I.M.'s marital status and
whether she was living with a
man, T.L., thereby calling into question the
composition
of her household, which Wisconsin alleged was an element
of
I.M.'s AFDC case status.
Wisconsin contended that the ambiguities about I.M.'s
status, resulting
in its inability to verify all of the
elements of AFDC eligibility or make
an accurate finding
that the amount of the grant was correct, arose from the
following circumstances. At the time of the October 1992
review
date, I.M. claimed that she was single and never
had been married. A
friend of I.M. corroborated this in
a written statement.
In the course of the state QC review, however, the state
reviewer
interviewed I.M.'s landlord who stated that I.M.
had leased her apartment
beginning in August 1992 under
the name of R.L. and lived in the apartment
with her
husband T.L. whom, the landlord asserted, I.M. had said
she had
married in August. The state reviewer also
discovered that I.M. had
received a car loan under the
name of R.L. 2/ The reviewer
further contacted T.L.'s
employer and the post office and confirmed from
both
sources that T.L. resided at I.M.'s address.
When the state reviewer confronted I.M. with the
landlord's assertion,
I.M. responded that she and her
children did not live with T.L. and that she
was not
married to T.L. I.M. explained that she used T.L.'s name
as her husband in order to lease the apartment and that,
while T.L.
visits her frequently, he lives with his
sister at another address.
Analysis
Wisconsin contended that I.M.'s case should be dropped
from the QC sample
because it received conflicting
evidence concerning what it considered a
basic element
affecting I.M.'s AFDC grant, specifically whether I.M. is
married to T.L. ACF contended that there was no relevant
controversy concerning this element because: 1) under
Wisconsin
law any relationship between I.M. and T.L. is
relevant only if T.L. were the
parent of any of I.M.'s
children; 2) the alleged marriage is not supported
by
either primary or secondary evidence of the kind required
by the QCM;
and 3) the state reviewer made a "special
determination" that no marriage
existed since there was
no conflicting primary and secondary evidence, and
the
collateral evidence of a marriage was slight.
Wisconsin argued that section 3533 of the QCM requires
the establishment
of the relationship of all members of
an AFDC household:
[T]he statute requires that certain individuals
living in the
household must be included in the AU.
As a consequence, relationship
of other individuals
in the household to members of the AU must be
developed to determine if all necessary members of
the unit were
included in the grant.
Wisconsin pointed out these discrepancies in the status
of I.M.'s
household: I.M. signed the lease as T.L.'s
wife and applied for a loan
also in that name; I.M.'s
landlord told the state reviewer that I.M. was
married to
T.L. and contacts with the post office and T.L.'s
employer
affirmed that T.L. had given I.M.'s address as
his home; on the other hand,
I.M. denied that she was
married and gave an explanation for representing
herself
as T.L.'s spouse on the lease; a close friend of I.M.
provided a
signed statement that I.M.'s household
consisted solely of herself and her
there children;
additionally, a check of Wisconsin, Illinois, and
Nebraska records revealed no evidence of a marriage
between I.M. and
T.L.
Wisconsin insisted that it was impossible under the
circumstances to
verify the existence of a marriage
between I.M. and T.L. as the couple could
have been
married anywhere in the United States or under alias
names. Similarly, Wisconsin stated that it could not
verify the
absence of T.L. from I.M.'s household.
Because of these unresolved discrepancies concerning the
relationship
between I.M. and T.L. and its effect on the
AFDC household, Wisconsin
maintained that I.M.'s case
accordingly should be dropped from the QC sample
as
provided for in section 3200 of the QCM. Wisconsin
acknowledged
that its state reviewer did complete I.M.'s
case and, while recommending
that the food stamp portion
of the case be dropped, found sufficient
information to
conclude the existence of an overpayment in the amount of
the AFDC grant. Wisconsin further admitted that it was
only after
the federal review that Wisconsin's re-
evaluation of the case concluded that
the case should
have been dropped by its reviewer rather than completed.
ACF maintained that the state reviewer's completion of
I.M.'s
case should stand and that nothing in the
regulations or the QCM required
dropping the case. ACF
noted the QCM's admonition against the dropping
of cases
from a QC sample:
It is imperative that the reviewer make every effort
to complete a
case because a large number of dropped
cases can bias the integrity of the
sample.
Section 3200.
ACF argued that the mere fact that T.L. might have lived
with I.M. is
irrelevant for purposes of AFDC eligibility
and cannot in and of itself
affect the amount of the AFDC
grant under applicable
regulations. 3/ ACF further
pointed out that there is no
evidence or even a
suggestion by Wisconsin that T.L. is the father of any of
the children in the AU. ACF contended that even if I.M.
and T.L.
were married, and T.L. thus became the
stepfather to I.M.'s children, under
Wisconsin state law
T.L. was under no legal responsibility to support I.M.'s
children. ACF noted that under 45 C.F.R. � 233.90(a)(1)
a
stepparent will be considered a parent under the AFDC
program only if the
stepparent is legally married to a
child's natural parent and state law
requires a
stepparent to support his or her stepchildren to the same
extent that natural or adoptive parents are required to
support their
children.
A review of the QCM supports ACF's position that T.L.'s
mere residence in
I.M.'s household is immaterial for AFDC
grant purposes. The QCM
directs a state reviewer:
Due to the requirement that certain individuals
living in the
household must be included in the AU,
determine the relationship of all
members of the
household to any dependent child(ren). The purpose
of the review under this element is to ascertain
. . . if a
household member is a parent or minor
sibling who must be included in the
AU.
Section 3533.C (emphasis added). This clearly implies
that
individuals other than parents or siblings are not
relevant to this
element. As stated above, there is no
indication that T.L. was the
father of any of the
children in the AU, and a stepparent or live-in
boyfriend
is not considered a parent under the provisions above.
Section 3533 of the QCM lists the following items as
primary evidence
that may be used to establish a specific
relationship other than parentage
within an AU: birth
certificates, adoption papers or records, marriage
license or certificate, divorce papers, Indian census
records, hospital
or public health records of birth and
parentage, government records of birth
and parentage,
court records of parentage, baptismal records of birth
and parentage, juvenile court records, court child
support records, and
Social Security Administration (SSA)
records indicating that a relationship
has been
established. Secondary evidence consists of: church
records, a family bible, health care records, child care
center records,
voluntary social service agency records,
insurance records, school records,
census records,
paternity records maintained by the Office of Child
Support Enforcement, and SSA records without an
indication that a
relationship has been established.
We see no basis for Wisconsin's conclusion that
conflicting
evidence concerning I.M.'s marital status
merits her case being dropped from
the QC sample.
Section 3520 of the QCM requires documentation by at
least one piece of required primary or secondary
evidence, or by a
signed statement from a collateral
source. In this case, neither
primary nor secondary
evidence demonstrated a marital relationship between
I.M.
and T.L. There is no marriage license. The only
"evidence" referred to by Wisconsin was the collateral
oral statement
given to the state reviewer by I.M.'s
landlord that I.M. was married.
I.M. flatly contradicted
this statement and gave a plausible explanation why
she
had told the landlord she was married. A close friend of
I.M.
supplied a written statement corroborating that I.M.
lived only with her
children.
ACF argued that the state reviewer, in completing the
AFDC QC review of
I.M.'s case, made what amounted to a
special determination, evaluating all
the information at
the reviewer's disposal regarding T.L.'s relationship
with I.M.'s household, and concluded that T.L. was not
married to I.M
and had no effect on the amount of I.M.
AFDC grant. A "special
determination," as provided for
in section 3520 of the QCM, is defined as
--
a reasonable conclusion, fully documented, based on
evidence which
provides sufficient basis for a
conclusion, but which does not meet
verification
requirements.
ACF added that the state reviewer noted on the review
worksheet that
while it is likely that T.L. lives with
I.M., there is not enough evidence
to refute I.M.'s
statement that T.L. did not reside with the AU. ACF
Ex.
A at 5.
An examination of the state reviewer's worksheet for
I.M's case reveals,
as ACF argued, that the reviewer
recommended that I.M.'s case be dropped
only for food
stamp quality control purposes, and not dropped from the
AFDC QC review. ACF Ex A at 1a. All members of a
household
may be relevant in the determination of food
stamp benefits, but, as
discussed above, the presence of
a non-parent is not relevant to the
assistance unit
determination under Wisconsin's AFDC program.
The discrepancies concerning the composition of I.M.'s
household that
Wisconsin claimed precluded a
determination that AFDC standards were met are
not
supported by evidence admissible under the QCM. With no
primary or secondary or acceptable collateral evidence
establishing a
marriage relationship between I.M. and
T.L., the state reviewer properly
completed the review of
I.M.'s case as an AU consisting of I.M. and her
children
and determined that I.M.'s case should not be dropped.
We
concur in that assessment. Wisconsin simply has not
produced any
evidence under the standards set forth in
the QCM that merits I.M.'s case
being dropped from the QC
sample.
Conclusion
For the reasons discussed above, we conclude that
Wisconsin cannot drop
I.M.'s case from the quality
control sample.
___________________________
Peggy McFadden-Elmore
___________________________
Leslie Sussan
___________________________
Thomas D. Horvath
* * * Footnotes * * *
1. In order to protect
their privacy, this AFDC
recipient and her friend are identified by their
initials. The Wisconsin QC review number is
112067.
2. I.M. on
occasion used Renee as her first
name.
3. Section
233.90(a)(1) of 45 C.F.R. provides -
-
the inclusion in the family,
or the presence in the
home, of a "substitute
parent" or "man-in-the-house" or any other
individual other than the one described in this
paragraph [i.e., a
natural or adoptive parent,
or a stepparent who is legally obligated to
support the child under state law] is not an
acceptable basis for a
finding of ineligibility
or for assuming the availability of income by
the State.
Section 233.20(a)(2)(viii) of 45 C.F.R. further provides
that the amount
of a grant will not be reduced or
prorated solely because of the presence in
the household
of a non-legally responsible individual; contributions
from such an individual for the support of the AU cannot
be
assumed.
(..continued)