SB 930, introduced by State Sen. Noreen Evans (D-2nd District),  which would remove the fingerprinting requirements for IHSS recipients and providers,  passed the Senate on a 23-15 vote on September 1 and will be sent to Gov. Brown for signature.  He has 30 days to act on the bill.

Description: Would remove the fingerprinting requirement for IHSS recipients. Would remove the requirement to include spaces for provider and recipient fingerprints on provider timesheets. Would also remove the prohibitions against use of a post office box address by an IHSS provider.

Committee Analysis

2011 CA S 930: Bill Analysis – Assembly Human Services Committee – 06/28/2011

SUBJECT: In-home supportive services: enrollment and fingerprinting requirements

SUMMARY: Repeals requirements that In-Home Supportive Services (IHSS) recipients provide fingerprint images and that provider timesheets include spaces for provider and recipient fingerprints, and repeals the prohibition against providers using a post office box address to receive their paychecks.

 Specifically, this bill:

    1) Repeals the requirement that IHSS recipients provide fingerprint images at the time of assessment or reassessment.

    2) Repeals the requirement that the standardized timesheet include designated spaces for the index fingerprints of the provider and the recipient.

    3) Deletes the requirements and prohibitions related to the use of a post office box address by an IHSS provider.

 COMMENTS:

According to the author, this bill is intended to repeal three untenable components of the “IHSS Anti-Fraud Initiative” included in the 2009-10 budget trailer bill related to IHSS, AB X4 19, Chapter 17, Statutes of 2009 4th Extraordinary Session. The author says:

In 2009, Governor Schwarzenegger persuaded the Legislature to adopt the “IHSS Anti-Fraud Initiative.” The purpose of this effort was to ensure the identity of IHSS applicants and to prevent duplicate aid. The initiative included ten separate components. Three components of this initiative have proven to be costly and ineffective: (1) fingerprinting for all consumers, (2) provider and consumer fingerprints on timesheets, and (3) prohibition of the use of P.O. Boxes by providers on IHSS forms. There is no evidence to support the effectiveness of these three “anti-fraud” mandates. In the absence of this evidence, the $41.6 million to be spent on this part of the program should be spent on other priorities.

Background: In 2004, comprehensive legislation was enacted to standardize assessment of IHSS recipients’ needs and to ensure integrity in the IHSS program. SB 1104 (Committee on Budget & Fiscal Review), Chapter 224, Statutes of 2004. Among other requirements, SB 1104 directed DSS and the Department of Health Care Services (DHCS) to develop a new provider enrollment form that each person seeking to provide supportive services must complete, sign under penalty of perjury, and submit to the county. SB 1104 also gave DHCS authority to investigate suspected instances of fraud in the IHSS program. SB 1104 required DSS, DHCS, and county quality assurance staff to work together and coordinate activities.

In July 2009, AB X4 1 (Evans), Chapter 1, Statutes of 2009 4th Extraordinary Session, allocated additional 2009-10 and 2010-11 funds to DHCS and DSS for a total of 25 new fraud investigation and program integrity-related positions. AB X4 1 additionally included $10 million in additional funds to be allocated to counties based on their approved plans. AB X4 4 (Evans), Chapter 4 of the 2009-10 Fourth Extraordinary Session, the human services trailer bill, also included changes to provisions governing the new provider enrollment form, requiring documentation to be submitted in person by applicant providers to county offices.

At the same time, AB X4 19 (Evans), Chapter 17, Statutes of 2009 4th Extraordinary Session, was enacted to enhance program integrity and anti-fraud protections in the IHSS program. AB X4 19 was considered through the budget process and was not vetted through legislative policy committees. It included the following anti-fraud measures: (1) new provider enrollment requirements, (2) fingerprinting and criminal background checks for all providers, (3) increased data matching with jail, death and other official records to eliminate fraudulent claims, (4) provider acknowledgement of delivering services, (5) provider orientations, (6) unannounced home visits, (7) fraud training for county staff, (8) prohibition on the use of post office boxes by providers on IHSS forms, (9) fingerprinting recipients, and (10) fingerprints of recipient and provider on each timesheet. This bill repeals the last three of these measures.

    No cost-benefit analysis was done at the time to support the anti-fraud measures of AB X4 19, including the fingerprinting requirements. Nonetheless, the 2009-10 Budget included the Schwarzenegger Administration’s estimate of about $162 million General Fund savings as a result of new anti-fraud activities in the IHSS program. The estimated savings were based on an assumption of a basic 10% of program costs. No further empirical basis for the assumption was offered. The Administration’s 2010-11 Budget estimated an annual General Fund Savings of $130 million annually from anti-fraud measures.

How common is IHSS fraud? Statewide data on the incidence of fraud in the IHSS program is lacking. Federal participation in the cost of IHSS services comes through the Medicaid program, and because DHCS is California’s single state agency for Medicaid, the unit charged with investigating reports of suspected fraud in the IHSS program is located within that department. As reported in June 2009, according to DHCS:

Currently there is no accurate means of measuring or monitoring IHSS fraud within the state. This is because of the number of jurisdictions involved and the various data collection systems in place…

Because there is no accurate means of measuring or monitoring IHSS fraud within the state, we do not know the exact number of providers or recipients committing fraud.

In-Home Supportive Services: A Primer on Potential Fraud and Suggestions for Curbing It, California Senate Office of Oversight and Outcomes (June 26, 2009), p. 3.

While accurate statewide data on the incidence of IHSS fraud is lacking, there is no shortage of misinformation. For example, in support of the prior administration’s anti-fraud proposals, Governor Schwarzenegger and a number of district attorneys repeatedly referenced a figure of 25% in fraudulent IHSS payments. This figure appears to have originated in a 2004 Spring Finance Letter in reference, not to fraud but, rather, to weaknesses and deficiencies in the needs assessments conducted at the time. Based on State level case reviews conducted for a number of years, the Finance Letter notes, “at least 10% of all paid services may be over-assessed or have not actually been provided.” The Finance Letter then references the Governor’s Budget for FY 2004-05, which reportedly “acknowledged that up to 25% of the hours may be over-assessed.” This 25% figure was then picked up by news media and reported as a reflection of fraud in the IHSS program, rather than over-assessments due to problems with the need assessment process then in use.

A handful of grand jury reports issued during this period were likewise misrepresented. The Sacramento County grand jury released a report in March, 2009, for example, entitled IHSS: For the Needy, Not the Greedy. The report begins with statistics. From 2005-06 through 2006-07, Sacramento County paid $151 million to IHSS providers. Investigations found $820,000 in fraudulent overpayments. This represents 0.54% of payments. About 10% of these overpayments were recovered, according to the grand jury. Similarly, in fiscal year 2006-07, the grand jury found that there were 397 reports of suspected fraud out of approximately 17,735 IHSS cases-or 2.2%. Of those, 31 were referred and accepted for prosecution, a rate of prosecutable fraud of only 0.2%. Then, the grand jury report shifted away from data to sworn testimony. The report provides a list of fraudulent activities that at least one witness believed has taken place at least once within the county. The list is without quantification or details, and the report includes no direct quotations from witnesses’ statements.

Moreover, the grand jury did not assert that these activities went undetected, only that a witness said each activity had occurred. The grand jury concluded, offering no evidence in support and offering some evidence to the contrary, that fraud is “rampant and out of control.” The grand jury chose to highlight this broad and unsubstantiated claim in its executive summary and press release, and the media reported on it.

In sum, available data do not support the conclusion that there is widespread fraud in the IHSS program. If anything is rampant and out of control, it is the repeated dissemination of misinformation about the incidence of IHSS fraud.

Nonetheless, this bill does not impact most of the anti-fraud measures enacted through AB X4 19. It would cancel only the requirement that counties secure fingerprint images of applicants for and recipients of IHSS at the time of application or reapplication; the requirement that timesheets have a space for an index-finger print of both the recipient and the provider of IHSS; and, the prohibition against providers using a post office box for receipt of wage checks. In addition to “quality assurance” provisions added by the Legislature in 2004, seven of the ten measures included in AB X4 19 would remain in place.

Duplicate aid fraud: Fingerprinting of IHSS recipients is purportedly intended to prevent duplicate aid fraud-i.e., receiving aid under more than one identity or in more than one county. Whatever the overall incidence of fraud in the IHSS program, no data are available on the incidence of this type of fraud. In fact, it is difficult to even conceive of scenarios of how such duplicate aid fraud might be perpetrated by the seniors and people with disabilities who receive IHSS services.

As advocates opposing proposed 2010-11 Budget expenditures for proceeding with recipient fingerprinting pointedly remarked at the time, “[t]his is a solution in search of a problem; there is no evidence that people are disguising themselves as someone else to get IHSS, or that people are going from county to county to be bathed.”

Arguments in support: The California State Association of Counties (CSAC) and County Welfare Directors Association of California (CWDA) note in their joint support letter that the state has estimated that it would need $8.2 million this year alone, and a total of $41.6 million over the next 7 years, to implement the recipient fingerprinting requirement. “Clearly,” CSAC and CWDA say, “in these difficult fiscal times, the expenditure of millions to implement an anti-fraud initiative in the absence of demonstrated widespread fraud would be imprudent at best.” The Western Center on Law and Poverty quotes a May 8, 2010 letter to DSS from the Obama Administration concerning fingerprinting in the CalFresh program, which notes that “[m]ost States satisfy the requirement to establish a system to prevent duplicate participation by matching names with social security numbers, which is far less costly than finger image systems yet equally effective at detecting duplicate participation.”

Disability Rights California (DRC) notes, in relation to the prohibition on providers’ use of post office boxes, that there are many valid reasons that IHSS providers use post office boxes. Many IHSS providers live in rural areas where there are no alternative means for receiving mail. Also, many providers live with relatives or roommates who do not allow them to get mail sent to their residence. The U.S. Postal Service itself points out on its Web site that “[m]any customers value the privacy, security, and flexibility of a Post Office Box,” noting, for example, that: “It’s fast. Mail typically arrives faster at a PO Box than at a residential or business address” and “It’s permanent. You can move around, but your PO Box address stays the same.” CSAC and CWDA assert that limiting the use of post office boxes may harm the ability of counties and consumers to recruit and retain providers. In any event, as DRC points out, no evidence was ever offered to connect post office boxes with fraud.

Arguments in opposition: The California District Attorneys Association (CDAA) suggests that the anti-fraud measures in question, and particularly the fingerprinting requirements have a deterrent effect and that repealing these measures “will significantly hinder efforts to deter persons from seeking duplicate aid and could potentially make the discovery of such fraud more difficult.” CDAA also opposes repeal of the prohibition on using post office boxes, asserting that “[t]he less physical information law enforcement and prosecutors have about persons who would defraud the IHSS program, the harder it is to intercede and stop such activity.”

REGISTERED SUPPORT / OPPOSITION:

Support

American Civil Liberties Union American Federation of State, County and Municipal Employees (AFSCME) California Alliance for Retired Americans California Association of Public Authorities for IHSS (cosponsor) California Coalition for Women Prisoners (CCWP) California Disability Community Action Network California Foundation for Independent Living Centers California In-Home Supportive Services Consumer Alliance California State Association of Counties (CSAC) California United Homecare Workers Union, SEIU/AFSCME Local 4034 Californians for Disability Rights Communities United in Defense of Olmstead Contra Costa County County Welfare Directors Association of California (CWDA) Congress of California Seniors (CCS) Disability Rights California (cosponsor) In Home Supportive Services Coalition AARP-California Access to Independence ACLU Southern California California Alliance for Retired Americans California Association of Public Authorities California Church IMPACT Congress of California Seniors Californians for Disability Rights California Foundation for Independent Living California IHSS Consumer Alliance California Senior Legislature California Disability Community Action Network California United Homecare Workers Dayle McIntosh Center for the Disabled Disability Rights California East Bay Community Law Center Friends Committee on Legislation Gray Panthers Independent Livings Resource Center Inc. Marin IHSS Public Authority National Senior Citizen’s Law Center Nevada-Sierra-Plumas Public Authority Northern California ADAPT Older Women’s League Legal Services for Prisoners with Children National Association of Social Workers Pamela Hoye Personal Assistance Services Council of Los Angeles County San Francisco In-Home Supportive Services Public Authority Service Employees International Union (SEIU) California (cosponsor) State Independent Living Council The Arc and United Cerebral Palsy in California United Domestic Workers of America/ AFSCME Local 3930/ AFL-CIO (cosponsor) Western Center on Law & Poverty 1 Individual

Opposition

California District Attorneys Association (CDAA)

 Analysis Prepared by: Eric Gelber / HUM. S. / (916) 319-2089