HHS told CDSS it was out of compliance with the Improper Payments Information Act (IPIA) (read “overpayments”) of 2002 and that the state’s practice of repaying the federal share of overpayments only upon collection is not acceptable. (CDSS initially issued ACL 06-48 on this issue, and counties were directed to identify and track all federal foster care and adoption assistance overpayments beginning October 1, 2006, and ACIN I-60-07identifies best practice guidelines.) To ensure state and county compliance with federal reporting requirements for Title IV-E overpayments, several sections of the Welfare and Institutions Code were amended. This letter reviews those changes.

The letter clarifies collection against foster family homes, relative homes, non-related extended family members and legal guardians. The recovery of these overpayment funds must be done in a way that does not jeopardize the overall availability of placements for foster or adoptive children, as well as to act in the best interests of the foster or adoptive child. In addition to identifying the conditions under which a county should not collect an overpayment, and providing examples, the letter reviews the types of costs counties should consider when determining the cost effectiveness of collecting overpayments. Due process for providers will now be through the use of both informal and formal hearings rather than a review. [Download]

AB 1331 requires counties to screen all foster youth for potential SSI/SSP eligibility when foster youth are at least 16.5 years of age and no more than 17.5 years of age. The statute also addresses the problem with current federal regulations, which causes the denial of SSI to youth getting foster care benefits over the SSI level of PRIOR to having a medical eligibility determination. Counties are to forego federal AFDC-FC benefits for the potentially SSI/SSP eligible youth for one month, during which time an SSI/SSP application is submitted. Social Security agreed to accept and process applications for foster youth during the month they are in receipt of State AFDC-FC. Counties thus must transfer a youth from federal AFDC-FC to State AFDC-FC for one month while the SSI/SSP application is submitted. After the one month transfer, the youth must be transferred back to federal AFDC-FC. The letter reminds counties to submit applications early enough to allow a determination to be made by SSA as to the youth’s eligibility PRIOR to the youth’s emancipation (estimating this takes six months!). Once the youth has been determined to be medically eligible for SSI/SSP, if the youth is in receipt of federal AFDC-FC benefits in excess to what they would receive in SSI/SSP, counties can request that the SSA put the youth’s SSI/SSP benefits in suspense for up to 12 months.

Though effective January 1, 2008, no additional funds to implement the bill are available in the current Fiscal Year. The ACL encourages counties to implement AB 1331 with existing allocations. [Download]