PROGRAM INTEGRITY ASSESSMENT SUPPLEMENT Low Income Home Energy Assistance Program (LIHEAP) ABSTRACT: HHS is requiring further detail from States on their FY2011 plans for preventing and detecting fraud, abuse, and improper payments. HHS is also requiring that States highlight and describe all elements of this FY2011 plan which represent improvements or changes to the State’s FY2010 plan for preventing and detecting fraud, abuse and improper payment prevention. State, Tribe or Territory (and Date/Fiscal Year: New York State grant official): September 1, 2010 Phyllis Morris, LIHEAP Coordinator FFY 2011 RECENT AUDIT FINDINGS Describe any audit findings of material weaknesses and reportable conditions, Please describe whether the questioned costs and other cited audit findings or relevant findings cited in FY2010 or the Necessary outcomes operations have been resolved If there is no plan in place, prior three years, in annual from these systems or corrected. If not, please please explain why not. audits, State monitoring and strategies describe the plan and timeline assessments, Inspector General for doing so in FY2011. reviews, or other Government Agency reviews of LIHEAP agency finances. New York State’s LIHEAP program N/A is audited annually under the Single Audit Act. No Single Audit findings of material weaknesses, reportable conditions or questioned costs were identified for FFY 2010 or the prior three years. OTDA conducts annual on-site monitoring reviews of at least ten local social services districts. No The timely and findings of material weaknesses, thorough resolution of reportable conditions or weaknesses or questioned costs were identified reportable conditions for FFY 2010 or the prior three as revealed by the years. audit. During FFY 2010, OTDA Each vendor that had completed reviews of 50 LIHEAP overcharged LIHEAP clients was vendors. For each vendor, OTDA instructed to issue a credit to sampled 15 payment records. the individual customer’s OTDA found that four of the 50 account and also make account vendors had charged LIHEAP adjustments to other HEAP clients more than the margin clients in their customer base. over rack or discount off retail In addition, they were price required under the terms of instructed to submit a the NYS LIHEAP vendor description of how they would agreement (see Attachment I). ensure that OTDA HEAP pricing 2 The total amount of overcharges policies would be adhered to in was approximately $6,500. the future. In 2009, the U.S. Government With regard to the GAO Accountability Office (GAO) finding, we instructed Albany reviewed the potential for LIHEAP County to take action to fraud and abuse in seven states, recover the erroneously issued including New York State. The benefit (see Attachment II), only NYS specific finding that was and Albany County is pursuing shared with us was that a $240 recovery (see Attachment III). regular 2007-08 HEAP benefit and New York State’s LIHEAP a $425 emergency 2007-08 HEAP application clearly asks the benefit were provided to an applicant to list only those Albany County applicant who people living in the same house included two incarcerated or apartment. When an individuals as members of her applicant lists adult children household on her application. without income, our The household would not have procedures (as described in our been income eligible for a HEAP HEAP Manual) direct the crisis benefit without the certifier to require the inclusion of two household applicant to provide a signed members who were incarcerated statement for any adult at the time of application. While household member with zero GAO’s report states that 9 income stating the adult has no percent of households receiving income. This procedure was LIHEAP benefits in the selected not followed in this case. states contained invalid identify information, we were not provided with the data behind this assertion and therefore do not know whether any of these households were New York State households. DHHS conducted an on-site review of New York State’s HEAP program in 2007. HHS’s only finding was that local offices for the aging were using LIHEAP weatherization funds for non- energy related repairs. This was an issue that OTDA had identified shortly before the HHS review, and a written directive was issued to all local aging offices to clarify that LIHEAP weatherization funds may only be used for energy related and energy conserving repairs. In 2007, OTDA conducted a review of the New York State Division of Housing and Community Renewal’s administration of LIHEAP funded weatherization programs and of the New York State Office for the Aging’s administration of LIHEAP 3 funded outreach and weatherization referral and packaging programs. Other than finding that some local offices for the aging were using LIHEAP weatherization funds for non-energy related repairs, which had already been addressed, no other findings of material weaknesses, reportable conditions or questioned costs were identified. 4 COMPLIANCE MONITORING Describe the State's FY2010 If you don't have a firm strategies that will continue in Please highlight any strategies compliance monitoring system FY2011 for monitoring for compliance monitoring Necessary outcomes in place for FY11, please compliance with State and from your plan which will be from these systems describe how the State is Federal LIHEAP policies and newly implemented as of and strategies verifying that LIHEAP policy and procedures by the State and local FY2011. procedures are being followed. administering agencies. At a minimum, OTDA conducts All of these strategies are N/A annual on-site reviews of at least currently in place. ten local social services districts to monitor compliance with State and Federal LIHEAP policies and procedures. Districts are chosen for review based upon factors that include, but are not limited to, the number of application approvals during the immediately preceding HEAP program year and non-compliance in resolving issues identified in previous monitoring reviews. During FFY 2011, OTDA will continue to review a sample of HEAP vendors to ensure compliance with the terms and A sound methodology, conditions of the New York State with a schedule for LIHEAP vendor agreement. regular monitoring and a more effective New York State’s HEAP program monitoring tool to is audited annually under the gather information. Single Audit Act. An annual audit of local administering agencies is conducted. OTDA conducts periodic reviews of the New York State Division of Housing and Community Renewal’s administration of LIHEAP funded weatherization programs and of the New York State Office for the Aging’s administration of LIHEAP funded outreach and weatherization referral and packaging programs to ensure that funds are obligated and expended in compliance with LIHEAP rules. 5 FRAUD REPORTING MECHANISMS If you don't have any tools or mechanisms available For FY2010 activities continuing in FY2011, Please highlight any tools to the public to prevent please describe all (a) mechanisms available or mechanisms from your fraud or improper Necessary to the public for reporting cases of plan which will be newly payments, please describe outcomes of these suspected LIHEAP fraud, waste or abuse? implemented in FY2011, your plan for involving all strategies and [These may include telephone hotlines, and the timeline for that citizens and stakeholders systems websites, email addresses, etc.] (b) implementation. involved with your strategies for advertising these resources. program in detecting fraud. OTDA has a Reporting Welfare Fraud form An enhancement to the N/A (see Attachment IV) that is accessible from OTDA internet site for FFY the OTDA internet site at 2011 will permit the http://otda.ny.gov/main/resources/welfare- Reporting Welfare Fraud fraud/ which allows the public to report form to be submitted suspected instances of welfare fraud and directly online. Once abuse. The form is currently available in PDF submitted, the information format, which requires that it be printed and will be automatically mailed. Once submitted, the information is matched to a database of manually checked against a database of recipients to determine if recipients to determine if the individual the individual about whom about whom the fraud allegation was made the fraud allegation was is known to the Welfare Management made is known to the System (WMS) database. Those individuals Welfare Management who are known to WMS are flagged for System database. Those Clear lines of review by OTDA’s Office of Audit and Quality individuals that do match communication for Improvement (A&QI) staff, who then will be flagged for review citizens, grantees, determine if the allegation should be by OTDA A&QI staff, who clients, and referred to the local district for will then determine if the employees to use in investigation. The local district allegation should be pointing out investigators, in turn, review the fraud referred to the local district potential cases of allegation and return the results of the for investigation. The local fraud or improper investigation back to OTDA. OTDA manually district investigators, in payments to State tracks the results of the fraud allegation turn, will be able to access administrators. submissions and subsequent investigations. the system to review the fraud allegation and enter The public may also report fraud directly to the results of the local social service district fraud units as well investigation directly into as through hotlines or websites that certain the system. System- districts have. generated and ad-hoc reporting capabilities will In addition, the NYS Welfare Inspector allow OTDA and local General’s Office has a process to report district staff to track and fraud through its hotline at: report the results of the http://www.owig.state.ny.us/ fraud allegation owig/complaint_form.asp . submissions and subsequent investigations. 6 VERIFYING APPLICANT IDENTITIES If you don't have a system in place for verifying applicant's Describe all FY2010 State policies Please highlight any policy or identities, please explain why Necessary outcomes continuing in FY2011 for how strategy from your plan which and how the State is ensuring from these systems identities of applicants and will be newly implemented in that only authentic and eligible and strategies household members are verified. FY2011. applicants are receiving benefits. Household composition must be Because HHS is now permitting N/A documented for each LIHEAP states to require all members household member at the point of the household applying for of initial application with one of LIHEAP assistance to provide the following: their Social Security Number, for FFY 2011, New York State Driver’s license will be sending the SSN for all Birth certificate household members to SSA for Baptismal certificate validation while in prior years, School records NYS could only validate the SSN Collateral contacts with with SSA for the household landlords members who voluntarily Social Security card provided their SSN. Marriage certificate Passport For FFY 2010, New York State requested, but did not require, Social Security Numbers (SSNs) of household members applying only for HEAP. For FFY 2011, New To ensure that York State will require SSNs for program benefits are all household members applying provided to eligible for HEAP. For FFY 2010 and individuals. continuing into FFY 2011, the SSNs for individuals who are categorically income eligible for HEAP by virtue of their receipt of Safety Net Assistance, Family Assistance, Supplemental Security Income or Supplemental Nutrition Assistance Program benefits are obtained at the point the individuals apply for one or more of these other programs. All SSNs are verified with the Social Security Administration (SSA) for validity. NYS’s Welfare Management System (WMS) performs an electronic clearance process for all new applicants to provide local district workers with information about the applicant’s 7 current and past involvement as an applicant or recipient of assistance. Search criteria consist of matching name, gender, date of birth, Social Security Number and Client Identification Number (if previously assigned). Rigid controls and edits have been established to insure that each applicant has only one Client Identification Number (CIN) and that the demographic information associated with that applicant and CIN is accurate. 8 SOCIAL SECURITY NUMBER REQUESTS If the State is not requiring Describe the State's FY2011 Please describe whether the Social Security Numbers of policy in regards to requiring State's policy for requiring or LIHEAP applicants and/or Necessary outcomes Social Security Numbers from not requiring Social Security household members, please from these systems applicants and/or household numbers is new as of FY2011, explain what supplementary and strategies members applying for LIHEAP or remaining the same. measures are being employed benefits. to prevent fraud. For FFY 2011, New York State will For FFY 2010, New York State N/A require Social Security Numbers requested, but did not require, (SSNs) for all household members Social Security Numbers (SSNs) applying for HEAP. of household members applying only for HEAP. All SSNs are verified with the Social Security Administration For FFY 2010 and continuing (SSA) for validity. into FFY 2011, the SSNs for All valid household individuals who are members are reported categorically income eligible for for correct benefit HEAP by virtue of their receipt determination. of Safety Net Assistance, Family Assistance, Supplemental Security Income or Supplemental Nutrition Assistance Program benefits are obtained at the point the individuals apply for one or more of these other programs. 9 CROSS-CHECKING SOCIAL SECURITY NUMBERS AGAINST GOVERNMENT SYSTEMS/DATABASES Describe if and how the State used existing government If the State won't be cross systems and databases to verify Please highlight which, if any, checking Social Security applicant or household member policies or strategies for using Numbers and ID information Necessary outcomes identities in FY2010 and existing government databases with existing government from these systems continuing in FY2011. (Social will be newly implemented in databases, please describe how and strategies Security Administration FY2011. the State will supplement this Enumeration Verification System, fraud prevention strategy. prisoner databases, Government death records, etc.) SSN Validation: Household Because HHS is now permitting N/A members applying for HEAP with states to require all members SSNs present undergo a batch of the household applying for processing activity known as SSN LIHEAP assistance to provide validation whereby WMS sends their Social Security Number, Social Security Numbers (SSNs) for FFY 2011, New York State with associated demographic will be sending the SSN for all data to the Social Security household members to SSA for Administration (SSA) for validation while in prior years, comparison. If the SSN and NYS could only validate the SSN demographic data that is with SSA for the household associated with an individual on members who voluntarily WMS matches the information on provided their SSN. file with the SSA, then that individual's SSN Code is changed to ‘8’ (SSN validated) in WMS. If the SSN is not validated by SSA, the SSN Code is changed to a different value to indicate the reason the SSN was not validated. SSN validation occurs Use of all available on a weekly basis and again on a database systems to monthly basis for a recheck make sound eligibility regardless of their existing determination. validation code. SSA Death Match: Household members applying for HEAP with SSNs present are part of a monthly match whereby WMS sends to SSA individuals with SSNs present and, if SSA records indicate that that individual has been reported as deceased, for Temporary Assistance (TA) and Food Stamp (FS) cases receiving HEAP, single-individual cases are automatically closed and multi- individual cases are reported to local districts for appropriate action (i.e. deletion of the deceased individual and possible grant recalculation). 10 TA/FS Prison Match: On a monthly basis, TA and FS individuals (who may also be in receipt of HEAP benefits) are matched with New York State Department of Criminal Justice Services (DCJS) and New York State Division of Correctional Services (DOCS) databases to determine if those individuals are currently incarcerated. If a match is found, a monthly auto-close process occurs for single- individual cases, closing their TA and/or FS case and their corresponding categorical income eligibility for HEAP. Districts are notified of all cases closed as part of this process. State staff from OTDA’s Office of Audit and Quality Improvement (A&QI) receive lists of multi-person cases and refer these cases to local districts for investigation. 11 VERIFYING APPLICANT INCOME If the State won't be using new Describe how the State or Please highlight any policies or hire directories to verify designee used State Directories Necessary outcomes strategies for using new hire applicant and household of new hires or similar systems to from these systems directories which will be newly member incomes how will the confirm income eligibility in and strategies implemented in FY2011. State be verifying that FY2010 and continuing in FY2011. information? New York State did not use State Because the data is not real- New York State will verify directories of new hires or similar time, New York State will not applicant and household systems to confirm income be using State directories of member incomes in FFY 2011 eligibility for HEAP in FFY 2010, new hires or similar systems to for households not in receipt of and does not plan to do so in FFY confirm income eligibility for recurring TA, FS or code A SSI in 2011. The data in such systems is HEAP in FFY 2011. accordance with the procedures not real-time and therefore does in the New York State HEAP Effective income not provide New York State with If SSA were to permit states to manual (see Attachment V). determination the ability to correctly confirm use the State OnLine Query achieved through income eligibility at the point in (SOLQ) system to determine coordination across time when an applicant applies initial and ongoing eligibility for program lines. for what is, for the vast majority HEAP, New York State would of New York State’s HEAP use this real-time system to recipients, a one-time per year enable local social services HEAP benefit. districts and alternate certifiers to confirm income eligibility for HEAP starting in FFY 2011. 12 PRIVACY-PROTECTION AND CONFIDENTIALITY Describe the financial and If you don't have relevant operating controls in place in Please highlight any controls or physical or operational controls Necessary outcomes FY2010 that will continue in strategies from your plan which in place to ensure the security from these systems FY2011 to protect client will be newly implemented as and confidentiality of private and strategies information against improper use of FY2011. information disclosed by or disclosure. applicants, please explain why. The stringent controls in place N/A Access to HEAP case information in FFY 2010 will be continued in and issuance of HEAP payments is FFY 2011. limited to specific staff members in OTDA and in the local social services districts through the Terminal Transaction Security System (TTSS), a sub-system of WMS. TTSS is the security system that controls and monitors access to State legacy systems/centralized data base information on an operational needs basis. All system users are assigned User IDs which allow limited access to HEAP information and, depending on functions assigned that User ID, may allow the ability to issue Clear and secure HEAP payments. TTSS manages methods that day-to-day security-related data maintain and activities needed to meet confidentiality and user access requirements by safeguard the private applying and adhering to the information of shared security mandate of applicants. granting access permissions and entitlements based on the fundamental principle of least privilege, i.e. granting the minimum access required to perform one's job duties when requesting, creating and managing user accounts and permissions. New York State Social Services Law section 136 and regulations under 18 NYCRR 357 provide for the safeguarding of confidential information received from applicants and recipients of public assistance and care programs. 13 LIHEAP BENEFITS POLICY If the State doesn't have policy Describe FY2010 State policies in place to protect against Please highlight any fraud continuing in FY2011 for improper payments when prevention efforts relating to Necessary outcomes protecting against fraud when making payments or providing making payments or providing from these systems making payments, or providing benefits on behalf of clients, benefits which will be newly and strategies benefits to energy vendors on what supplementary steps is implemented in FY2011. behalf of clients. the State taking to ensure program integrity. To insure accountability and to The stringent controls in place N/A protect against internal in FFY 2010 will be continued in fraudulent transactions, WMS FFY 2011. has in place a system to track the User ID, Date, Time and Terminal used by individual workers who may inquire into or enter data, including the issuance of HEAP benefits, into the WMS database. In instances of suspected fraud or abuse of the system, reports can be generated to identify individuals who may attempt to perform such unwarranted transactions. Additionally, all transactions generate a “tagged user” through WMS’ Local Data Feedback (LDF) process to identify, for local district management staff, the origin of any transactions performed on the system. Authorized energy WMS has in place numerous on- vendors are receiving line and batch processing edits to payments on behalf of prevent the accidental or LIHEAP eligible clients. purposeful issuance of duplicate HEAP benefits, and New York City’s HEAP system checks for duplicate names and addresses prior to payment issuance. On WMS, only one regular HEAP benefit (Pay Type H1) may be issued per case during each HEAP benefit year and, additionally, the Benefit Issuance and Control Subsystem (BICS) contains edits and controls to prevent duplicate issuances for various other HEAP single-issue payment types. Additionally, WMS edits insure that payments authorized must match stored budgets contained in its Automated Budget and Eligibility Logic (ABEL) budgeting subsystem. 14 During FFY 2011, OTDA will continue to review a sample of HEAP vendors to ensure compliance with the terms and conditions of the New York State LIHEAP vendor agreement. 15 PROCEDURES FOR UNREGULATED ENERGY VENDORS Describe the State's FY2010 If you don't have a firm plan for procedures continuing in FY2011 averting fraud when dealing for averting fraud and improper Please highlight any strategies Necessary outcomes with unregulated energy payments when dealing with bulk policy in this area which will be from these systems vendors, please describe how fuel dealers of heating oil, newly implemented in FY2011. and strategies the State is ensuring program propane, wood and other un- integrity. regulated energy utilities. Same as in LIHEAP BENEFITS The stringent controls in place N/A Participating vendors POLICY, above in FFY 2010 will be continued in are thoroughly FFY 2011. researched and inspected before benefits are issued. 16 VERIFYING THE AUTHENTICITY OF ENERGY VENDORS Describe State FY2010 policies If you don't have a system in continuing in FY2011 for verifying Please highlight any policies for place for verifying vendor Necessary outcomes the authenticity of energy verifying vendor authenticity authenticity, please describe from these systems vendors being paid under LIHEAP, which will be newly how the State can ensure that and strategies as part of the State’s procedure implemented in FY2011. funds are being distributed for averting fraud. through valid intermediaries? All HEAP vendors must provide: For FFY 2011, New York State N/A will begin using Internet search Federal tax ID number engines to check the validity of Proof of insurance the addresses provided by fuel Proof of licensing vendors applying to be HEAP An effective process vendors as part of our efforts that effectively During FFY 2011, OTDA will to validate vendor authenticity. confirms the existence continue to conduct on-site of entities receiving reviews of a sample of HEAP federal funds. vendors to ensure compliance with the terms and conditions of the New York State HEAP vendor agreement and to verify the authenticity of HEAP vendors. 17 TRAINING AND TECHNICAL ASSISTANCE If you don't have a system in In regards to fraud prevention, place for anti-fraud training or please describe elements of your Please highlight specific technical assistance for FY2010 plan continuing in FY2011 elements of your training employees, clients or energy for training and providing Necessary outcomes regiment and technical vendors, please describe your technical assistance to (a) from these systems assistance resources from your strategy for ensuring all employees, (b) non- and strategies plan which will represent employees understand what is governmental staff involved in newly implemented in FY2011. expected of them and what the eligibility process, (c) clients, tactics they are permitted to and (d) energy vendors employ. OTDA conducts training sessions The comprehensive training N/A in August of each year to train and technical assistance in local social services district and place in FFY 2010 will be alternate certifier staff on the continued in FFY 2011. changes for the upcoming HEAP season. In addition, New York State provides new HEAP certifiers with the opportunity to attend HEAP Basic Certification Training, which provides in-depth training on correctly determining HEAP eligibility and on using the benefit authorization systems correctly. OTDA provides local district and alternate certifier staff with a HEAP Manual that is updated annually, and which provides The timely and detailed instructions on correctly thorough resolution of determining and documenting weaknesses or eligibility and on correctly reportable conditions authorizing payments to energy as revealed by the vendors on behalf of eligible audit. clients. The instructions in the HEAP Manual and additional policy and procedural requirements are provided to local districts in writing on a regular basis throughout the year. OTDA also holds vendor meetings to instruct HEAP vendors on the correct procedures and policies to follow in determining the correct price to charge HEAP recipients, in applying HEAP benefits and in making LIHEAP funded fuel deliveries. 18 All HEAP applicants are provided with a client notice that describes the benefit amount if the client has been determined eligible. For clients that are not eligible, the client notice provides the reason why the client is not eligible. If the benefit is being directly issued to the client’s energy vendor on behalf of the client, the client notice provides the name of the vendor where the benefit is being sent. Clients therefore have the information necessary to inform their certifier if the payment is not being sent to the correct vendor. All individuals in receipt of a HEAP benefit in the prior year are sent a HEAP application for the current year and a cover letter is included with the application that provides details on eligibility requirements, and any documentation or eligibility changes from the prior year. New York State also has a HEAP hotline that clients may call if they are in need of information or assistance. 19 AUDITS OF LOCAL ADMINISTERING AGENCIES If you don’t have specific audit requirements for local Please describe the annual audit Please describe new policies or administering agencies, please Necessary outcomes requirements in place for local strategies to be implemented explain how the Grantee will from these systems administering agencies in FY2010 in FY2011. ensure that LIHEAP funds are and strategies that will continue into FY 2011. properly audited under the Single Audit Act requirements. Local administering agencies The audit processes in place in N/A were audited in accordance with FFY 2010 will be continued in the requirements in OMB Circular FFY 2011. A-133 in FFY 2010, and will continue to be audited in Reduce improper accordance with these payments, maintain requirements in FFY 2011. local agency integrity, OMB Circular A-133 requires non- and benefits awarded Federal entities that expend to eligible households. $500,000 or more in a year in Federal awards to have a single or program-specific audit conducted for that year. Additional Information Please attach further information that describes the Grantee’s Program Integrity Policies, including supporting documentation from program manuals, including pages/sections from established LIHEAP policies and procedures.
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