Bill Text: NY S04888 | 2023-2024 | General Assembly | Introduced
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Implements additional restrictions on actions to recover overpayment of certain assistance.
Spectrum: Partisan Bill (Democrat 5-0)
Status: (Introduced) 2024-06-07 - COMMITTED TO RULES [S04888 Detail]
Download: New_York-2023-S04888-Introduced.html
Bill Title: Implements additional restrictions on actions to recover overpayment of certain assistance.
Spectrum: Partisan Bill (Democrat 5-0)
Status: (Introduced) 2024-06-07 - COMMITTED TO RULES [S04888 Detail]
Download: New_York-2023-S04888-Introduced.html
STATE OF NEW YORK ________________________________________________________________________ 4888 2023-2024 Regular Sessions IN SENATE February 16, 2023 ___________ Introduced by Sens. RIVERA, HOYLMAN-SIGAL, JACKSON, KAVANAGH, SEPULVEDA -- read twice and ordered printed, and when printed to be committed to the Committee on Social Services AN ACT to amend the social services law and the civil practice law and rules, in relation to recovery of overpayment of certain assistance; and to repeal certain provisions of the social services law related thereto The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Section 104 of the social services law, subdivision 1 as 2 amended by chapter 573 of the laws of 1964, subdivision 2 as amended by 3 chapter 909 of the laws of 1974, subdivision 3 as added by chapter 433 4 of the laws of 1993 and subdivision 4 as added by chapter 340 of the 5 laws of 2003, is amended to read as follows: 6 § 104. Recovery from a person discovered to have property. 1. For 7 purposes of this section: 8 (a) "Overpayment" shall include erroneous payments made to an eligible 9 person in excess of the recipient's needs as defined in this chapter and 10 erroneous payments made to ineligible persons, including but not limited 11 to, payments made to such persons pending a fair hearing decision. 12 (b) "Recipient" shall mean any individual who is currently receiving 13 or at one time received assistance or care as pursuant to the provisions 14 of this title. 15 2. A public welfare official may bring an action or proceeding in a 16 court of competent jurisdiction against a [person] recipient who is 17 discovered to have real or personal property, which resulted in an over- 18 payment to the recipient, or against the estate or the executors, admin- 19 istrators and successors in interest of a person who dies leaving real 20 or personal property, [if such person, or any one for whose support he21is or was liable, received assistance and care during the preceding ten22years, and] and there has been an overpayment to the recipient. The EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD03579-01-3S. 4888 2 1 public welfare official shall be entitled to recover up to the value of 2 such property which cause the assistance or care to constitute an over- 3 payment to the recipient or the cost of such assistance or care, which- 4 ever is lower. [Any public assistance or care received by such person5shall constitute an implied contract. No claim of a public welfare offi-6cial against the estate or the executors, administrators and successors7in interest of a person who dies leaving real or personal property,8shall be barred or defeated, in whole or in part, by any lack of suffi-9ciency of ability on the part of such person during the period assist-10ance and care were received.11Nor shall the claim asserted by a public welfare official against any12person under this section be impaired, impeded, barred or defeated, in13whole or in part, on the grounds that another person or persons may also14have been liable to contribute.] 15 In all claims of the public welfare official made under this section 16 the public welfare official shall be deemed a preferred creditor. 17 [2. No] 3. The public welfare official shall not bring an action or 18 proceeding under this section if excess payments or payments made to the 19 person were made due to agency or contractor error, including but not 20 limited to an error made by a facilitated enroller. 21 4. In an action or proceeding under this section, the complaint shall 22 be accompanied by a certificate, signed by the attorney for the public 23 welfare official, declaring the following: 24 (a) the attorney has reviewed the facts of the case and has concluded 25 that there is a reasonable basis for the action or proceeding; 26 (b) certification that the continuous coverage protections under para- 27 graph (c) of subdivision four of section three hundred sixty-six of this 28 chapter do not apply to the recipient; 29 (c) the specific eligibility criteria under which the recipient was 30 allegedly ineligible for benefits; the budgeting methodology that was 31 applied in making the determination that the recipient was ineligible 32 for benefits, including the applicable resource or income limit for the 33 recipient's household composition during the claim period, and the 34 recipient's applicable resources and income during the claim period; the 35 time period during which the recipient was allegedly ineligible; the 36 value of the real or personal property which resulted in an overpayment; 37 and the amount of recovery sought; and 38 (d) the action or proceeding is supported by exhibits including an 39 accounting of the recovery sought and all expenditures of assistance or 40 care made on behalf of the recipient during the period of alleged inel- 41 igibility. 42 5. There shall be no right of action [shall accrue against] to recover 43 an alleged overpayment for assistance or care received by a person under 44 twenty-one years of age [by reason of the assistance or care granted to45him unless at the time it was granted the person was possessed of money46and property in excess of his reasonable requirements, taking into47account his maintenance, education, medical care and any other factors48applicable to his condition]. 49 [3.] 6. To the extent described in section 7-1.12 of the estates, 50 powers and trusts law, the trustee of a supplemental needs trust which 51 conforms to the provisions of such section 7-1.12 shall not be deemed to 52 be holding assets for the benefit of a beneficiary who may otherwise be 53 the subject of a claim under this section and no action or proceeding 54 may be brought against either the trust or the trustee to recover the 55 cost of assistance or care provided to such person, or anyone for whose 56 support such person is or was liable.S. 4888 3 1 [4.] 7. Any inconsistent provision of this chapter or of any other law 2 notwithstanding, a social services official may not assert any claim 3 under any provision of this chapter to recover payments of public 4 assistance if such payments were reimbursed by child support 5 collections. 6 8. There shall be no right of action against a recipient who loses 7 medical assistance eligibility by reason of excess resources or income 8 because the recipient's medical assistance eligibility group, as deter- 9 mined under section three hundred sixty-six of this chapter, changed 10 from MAGI, as defined in section three hundred sixty-six of this chap- 11 ter, to non-MAGI, for the two years subsequent to their eligibility 12 change. A right of action against such a recipient begins to accrue 13 only if the recipient remains ineligible for medical assistance after 14 the two-year grace period. 15 9. The public welfare official shall not use confession of judgment to 16 recover an overpayment of public assistance or care, or supplemental 17 nutrition assistance benefits. 18 10. Any action or proceeding to recover an overpayment under this 19 section shall be waived in cases of undue hardship in which a recipi- 20 ent's adjusted gross income for the applicable household size is two 21 hundred fifty percent of the federal poverty line or lower and in cases 22 of other extenuating circumstances as determined by the public welfare 23 official. 24 11. Any action or proceeding under this section shall be commenced 25 within two years from payment for assistance or care. No determination 26 of a debt or award of debt shall be based upon payment for assistance or 27 care that occurred more than two years before the action or proceeding 28 is commenced. 29 12. The rate of interest for a judgment obtained pursuant to this 30 section shall be calculated at the one-year United States treasury bill 31 rate. For the purpose of this section, the "one-year United States 32 treasury bill rate" means the weekly average one-year constant maturi- 33 ty treasury yield, as published by the board of governors of the federal 34 reserve system, for the calendar week preceding the date of the entry 35 of the judgment awarding damages. 36 13. There shall be no right of action against a recipient whose 37 medical assistance eligibility was granted or extended during the period 38 of the COVID-19 public health emergency, defined for the purposes of 39 this section as March eighteenth, two thousand twenty through the end of 40 the quarter when such public health emergency ends. 41 14. All settlement and payment agreements under this section in which 42 the recipient has paid fifty percent or more of the debt by the end of 43 the COVID-19 public health emergency are hereby deemed paid in full. 44 15. If a recipient subject to a settlement or payment agreement under 45 this section has not paid fifty percent or more of the debt by the end 46 of the COVID-19 public health emergency, the recipient may submit 47 evidence of undue hardship and receive waiver of the remaining debt 48 under subdivision ten of this section or an appropriate reduction of 49 debt based on hardship. Notice regarding the opportunity for the waiver 50 shall be provided by the public welfare official. 51 § 2. Subdivision 7 of section 158 of the social services law is 52 REPEALED. 53 § 3. The civil practice law and rules is amended by adding a new 54 section 3012-c to read as follows: 55 § 3012-c. Certificate of merit in certain overpayment of assistance 56 actions. In any action or proceeding for recovery of an overpayment ofS. 4888 4 1 assistance or care, as defined in section one hundred four of the social 2 services law, the complaint shall be accompanied by a certificate, 3 signed by the attorney for the public welfare official, meeting all the 4 requirements of section one hundred four of the social services law. 5 § 4. The civil practice law and rules is amended by adding a new 6 section 3202 to read as follows: 7 § 3202. Confession of judgment for recovery of overpayment of certain 8 assistance invalid. Notwithstanding the provisions of section thirty-two 9 hundred eighteen of this article, no judgment by confession shall be 10 entered to recover an overpayment, as defined in section one hundred 11 four of the social services law. Any judgment entered in violation of 12 this section is void and unenforceable. 13 § 5. The civil practice law and rules is amended by adding a new 14 section 213-e to read as follows: 15 § 213-e. Actions to be commenced within two years; actions to recover 16 certain overpayments. An action or proceeding on an overpayment by a 17 public welfare official under section one hundred four of the social 18 services law shall be commenced within two years from payment for 19 assistance or care, and no determination of a debt or award of debt 20 shall be based upon payment for assistance or care that occurred more 21 than two years before the action or proceeding is commenced. 22 § 6. Section 106-b of the social services law, as amended by chapter 23 81 of the laws of 1995, is amended to read as follows: 24 § 106-b. Adjustment for incorrect payments. 1. For purposes of this 25 section: 26 (a) "Overpayment" shall include erroneous payments made to an eligible 27 person in excess of the recipient's needs as defined in this chapter and 28 erroneous payments made to ineligible persons, including but not limited 29 to, payments made to those persons pending a fair hearing decision. 30 (b) "Recipient" shall mean any individual who is currently receiving 31 or at one time received assistance or care under this title. 32 2. Any inconsistent provision of law notwithstanding, a social 33 services official shall, in accordance with the regulations of the 34 department and consistent with federal law and regulations, take all 35 necessary steps to correct any overpayment or underpayment to a public 36 assistance recipient[; provided, however,]. However: 37 (a) A social services official shall not bring an action or proceeding 38 under this section: 39 (i) if excess payments or payments made to an ineligible person were 40 made due to agency or contractor error, including but not limited to an 41 error made by a facilitated enroller; or 42 (ii) to recover an overpayment under this section for assistance or 43 care received by a person under twenty-one years of age. 44 (b) [that a] A social services official [may] shall waive recovery of 45 a past overpayment, in the case of an individual who is not currently a 46 recipient of public assistance, where the cost of recovery is greater 47 than the cost of collections as determined in accordance with department 48 regulations consistent with federal law and regulations. [For purposes49of this section, overpayment shall include payments made to an eligible50person in excess of his needs as defined in this chapter and payments51made to ineligible persons (including payments made to such persons52pending a fair hearings decision). The commissioner shall promulgate53regulations to implement procedures for correcting overpayments and54underpayments. The] 55 (c) In any action or proceeding to recover an overpayment under this 56 section, the social services official shall be entitled to recover noS. 4888 5 1 more than the value of the property which resulted in an overpayment to 2 the recipient or the cost of the assistance or care, whichever is lower. 3 (d) Any action or proceeding to recover an overpayment under this 4 section shall be waived in cases of undue hardship in which a recipi- 5 ent's adjusted gross income for the applicable household size is two 6 hundred fifty percent of the federal poverty line or lower and in cases 7 of other extenuating circumstances as determined by the social services 8 official. 9 3. The procedures for correcting overpayments shall be designed to and 10 shall minimize adverse impact on the recipient, and to the extent possi- 11 ble avoid undue hardship. [Notwithstanding any other provision of law12to the contrary, no underpayment shall be corrected with respect to a13person who is currently not eligible for or in receipt of home relief or14aid to dependent children, except that corrective payments may be made15with respect to persons formerly eligible for or in receipt of aid to16dependent children to the extent that federal law and regulations17require.] 18 4. A social services official shall follow the following procedures 19 when correcting any overpayment or underpayment to a public assistance 20 recipient under this section: 21 (a) When determining whether a recipient may be liable for an overpay- 22 ment, the most favorable budgeting under the applicable law and rules 23 shall be used to determine eligibility for assistance or care. 24 (b) After identification and verification of an overpayment, and prior 25 to meeting with the recipient under investigation, a written notice 26 containing the following information shall be mailed to the recipient: 27 (i) a statement of the specific eligibility criteria under which the 28 recipient was allegedly ineligible for benefits; 29 (ii) the budgeting methodology, under the applicable law and rules, 30 applied in making the decision to pursue recovery of an alleged overpay- 31 ment; 32 (iii) the time period during which the recipient was allegedly ineli- 33 gible; 34 (iv) the value of the real or personal property that resulted in an 35 overpayment; 36 (v) the amount of recovery sought, including an accounting of the 37 recovery sought and all expenditures of assistance or care made on 38 behalf of the recipient during the period of ineligibility; 39 (vi) an explanation of the recipient's rights to bring counsel or any 40 other person to any meeting with social services officials and to leave 41 any meeting with social services officials at any time; and 42 (vii) an explanation of the recipient's right to challenge liability 43 for an overpayment by establishing eligibility for assistance or care 44 using the most favorable budgeting under the applicable law and rules. 45 (c) No documents may be requested from recipients during an investi- 46 gation of an alleged overpayment unless it is directly relevant to the 47 eligibility factors and time periods for which the social services offi- 48 cial has a good faith basis to believe the recipient was ineligible. The 49 recipient shall be given a reasonable amount of time to respond to docu- 50 ment requests and meeting requests, taking into account time periods 51 necessary for third parties to provide documents. 52 (d) In the case of an alleged medical assistance overpayment, 53 districts shall contact recipient's managed care plans to ascertain 54 whether the recipient accessed services during the time period when 55 recovery is being contemplated.S. 4888 6 1 5. No settlement agreement or payment plan to recover an overpayment 2 shall be effective unless a social services official with personal know- 3 ledge of the claims produces an affidavit attesting to the validity of 4 the claims against the recipient, including but not limited to an attes- 5 tation that the social services official has determined that the contin- 6 uous coverage protections pursuant to paragraph (c) of subdivision four 7 of section three hundred sixty-six of this chapter do not apply to the 8 recipient. The attestation must also state the specific eligibility 9 criteria under to which the recipient was allegedly ineligible for bene- 10 fits; the budgeting methodology under the applicable laws and rules that 11 was applied in making the determination that the recipient was ineligi- 12 ble for benefits, including the applicable resource or income limits for 13 the recipient's household composition during the claim period, and the 14 recipient's applicable resources and income during the claim period; the 15 time period during which the recipient was allegedly ineligible; the 16 value of the real or personal property which resulted in an overpayment; 17 and the amount of recovery sought. The affidavit shall be supported by 18 exhibits including an accounting of the recovery sought and all expendi- 19 tures of assistance or care made on behalf of the recipient during the 20 period of ineligibility. 21 6. The social services official shall not use a confession of judgment 22 to recover an overpayment. 23 7. There shall be no action or proceeding to recover an overpayment 24 under this section for medical assistance benefits against a recipient 25 whose medical assistance eligibility was granted or extended during the 26 period of the COVID-19 public health emergency, to be defined as March 27 eighteenth, two thousand twenty through the end of the quarter when such 28 public health emergency ends. 29 8. All settlement agreements and payment plans obtained under this 30 section in which the recipient has paid fifty percent or more of the 31 debt by the end of the COVID-19 public health emergency are hereby 32 considered paid in full. 33 9. If a recipient subject to a settlement agreement or payment plan 34 under this section has not paid fifty percent or more of the debt by the 35 end of the COVID-19 public health emergency, the recipient shall be 36 allowed to submit evidence of undue hardship for waiver of the remaining 37 debt under paragraph (d) of subdivision two of this section or an appro- 38 priate reduction of debt based on hardship. Notice regarding the oppor- 39 tunity for such a waiver shall be provided by the social services offi- 40 cial. 41 § 7. This act shall take effect on the one hundred eightieth day after 42 it shall have become a law and shall apply to any claim, matter, or 43 administrative or legal action or proceeding pending at or after that 44 time. The commissioner of health, the commissioner of the office of 45 temporary and disability assistance, and local social services officials 46 shall make regulations and take other actions reasonably necessary to 47 implement this act on that date.
