LRB-1280/4
FFK&PJK:jld:rs
2013 - 2014 LEGISLATURE
June 4, 2013 - Introduced by Representatives Weininger, Jacque, Genrich,
Nygren, Tittl, Bies, Kolste, Kaufert, Berceau, Brooks, Schraa, LeMahieu,
Murphy, A. Ott, Pridemore, Ripp, Kahl, Vruwink, Endsley and Bernier,
cosponsored by Senators Cowles, Lasee, Hansen, Olsen and Schultz.
Referred to Committee on Urban and Local Affairs.
AB232,1,5 1An Act to amend 20.435 (4) (bm), 20.435 (4) (L), 20.435 (4) (nn), 20.435 (4) (pa),
220.437 (2) (dz), 20.437 (2) (L) and 49.793 (2) (a); and to create 49.846 of the
3statutes; relating to: an optional incentive program for counties and tribes
4that identify fraudulent activity in certain public assistance programs,
5granting rule-making authority, and making appropriations.
Analysis by the Legislative Reference Bureau
Under current law, a county or elected governing body of a federally recognized
American Indian tribe or band (county or tribe) may retain a portion of incorrect
overpayments in public assistance programs administered by the Department of
Health Services (DHS), including Medical Assistance and the supplemental
nutrition assistance program (known as FoodShare in Wisconsin), that are recovered
as the result of the efforts of an employee or officer of the county or tribe. Currently,
DHS establishes by rule the portion of FoodShare overpayment recoveries that a
county or tribe may retain. Under the bill, a county or tribe may retain the full
amount of FoodShare overpayment recoveries that the state is permitted to retain
under federal law. Current law also allows a county or tribe to retain a portion of
incorrect overpayments that are recovered in Wisconsin Works program as the result
of the efforts of an employee or officer of the county or tribe. Under current law,
Milwaukee County may not retain a portion of incorrect payments that are recovered
as a result of the efforts of an employee or officer of the county.
Under the bill, DHS is required to establish an optional incentive program, by
rule, under which a county with a population of less than 750,000 or tribe receives

a reward payment if an employee or officer of the county or tribe identifies fraudulent
activity in Medical Assistance or FoodShare. Under the bill, the amount of the
reward payment under the program is 20 percent of the amount that DHS
determines will be saved in the program over a 12-month period as the result of
eliminating the identified fraudulent activity. The bill also provides that, if a county
or tribe receives a reward payment under the optional incentive program, the county
or tribe may not retain overpayments that are recovered as the result of the identified
fraudulent activity. Under the bill, the Department of Children and Families is
required to establish a similar incentive program, by rule, that applies to fraudulent
activity in Wisconsin Works that is identified by an employee or officer of a county
or tribe.
For further information see the state and local fiscal estimate, which will be
printed as an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB232,1 1Section 1. 20.435 (4) (bm) of the statutes is amended to read:
AB232,3,52 20.435 (4) (bm) Medical Assistance, food stamps, and Badger Care
3administration; contract costs, insurer reports, and resource centers.
Biennially, the
4amounts in the schedule to provide a portion of the state share of administrative
5contract costs for the Medical Assistance program under subch. IV of ch. 49 and the
6Badger Care health care program under s. 49.665 and to provide the state share of
7administrative costs for the food stamp program under s. 49.79, other than payments
8under s. 49.78 (8), for reward payments under s. 49.846 (2), to develop and implement
9a registry of recipient immunizations, to reimburse 3rd parties for their costs under
10s. 49.475, for costs associated with outreach activities, for state administration of
11state supplemental grants to supplemental security income recipients under s.
1249.77, to administer the pharmacy benefits purchasing pool under s. 146.45, and for
13services of resource centers under s. 46.283. No state positions may be funded in the
14department of health services from this appropriation, except positions for the
15performance of duties under a contract in effect before January 1, 1987, related to

1the administration of the Medical Assistance program between the subunit of the
2department primarily responsible for administering the Medical Assistance
3program and another subunit of the department. Total administrative funding
4authorized for the program under s. 49.665 may not exceed 10% of the amounts
5budgeted under pars. (p) and (x).
AB232,2 6Section 2. 20.435 (4) (L) of the statutes is amended to read:
AB232,3,167 20.435 (4) (L) Fraud and error reduction. All moneys received as the state's
8share of the recovery of overpayments and incorrect payments under ss. 49.497 (1)
9and (1m), 49.793 (2) (a), and 49.847, all moneys received from counties and tribal
10governing bodies as a result of any error reduction activities under ss. 49.197 and
1149.845, and all moneys credited to this appropriation account under ss. 49.497 (2) (b),
1249.793 (2) (b), and 49.847 (3) (b), for any contracts under s. 49.197 (5), for any
13activities to reduce error and fraud under s. 49.845, to pay federal sanctions under
14the food stamp program, for reward payments under 49.846 (2), and for food stamp
15reinvestment activities under reinvestment agreements with the federal
16department of agriculture that are designed to improve the food stamp program.
AB232,3 17Section 3. 20.435 (4) (nn) of the statutes is amended to read:
AB232,3,2318 20.435 (4) (nn) Federal aid; income maintenance. All moneys received from the
19federal government for the costs of contracting for the administration of the Medical
20Assistance program under subch. IV of ch. 49 and the Badger Care health care
21program under s. 49.665 and the food stamp program, other than moneys received
22under par. (pa), for costs to administer income maintenance programs, as defined in
23s. 49.78 (1) (b), and for reward payments under 49.846 (2).
AB232,4 24Section 4. 20.435 (4) (pa) of the statutes is amended to read:
AB232,4,7
120.435 (4) (pa) Federal aid; Medical Assistance and food stamp contracts
2administration.
All federal moneys received for the federal share of the cost of
3contracting for payment and services administration and reporting, other than
4moneys received under par. (nn), to reimburse 3rd parties for their costs under s.
549.475, for administrative contract costs for the food stamp program under s. 49.79,
6for reward payments under s. 49.846 (2), and for services of resource centers under
7s. 46.283.
AB232,5 8Section 5. 20.437 (2) (dz) of the statutes is amended to read:
AB232,5,29 20.437 (2) (dz) Temporary Assistance for Needy Families programs;
10maintenance of effort.
The amounts in the schedule, less the amounts withheld
11under s. 49.143 (3), for administration and benefit payments under Wisconsin Works
12under ss. 49.141 to 49.161, the learnfare program under s. 49.26, and the work
13experience program for noncustodial parents under s. 49.36; for payments to local
14governments, organizations, tribal governing bodies, and Wisconsin Works agencies;
15for reward payments under s. 49.846 (3); and for emergency assistance for families
16with needy children under s. 49.138. Payments may be made from this appropriation
17account for any contracts under s. 49.845 (4) and for any fraud investigation and
18error reduction activities under s. 49.197 (1m). Moneys appropriated under this
19paragraph may be used to match federal funds received under par. (md).
20Notwithstanding ss. 20.001 (3) (a) and 20.002 (1), the department may transfer funds
21between fiscal years under this paragraph. Notwithstanding ss. 20.001 (3) and
2220.002 (1), the department of health services shall credit to this appropriation
23account funds for the purposes of this appropriation that the department transfers
24from the appropriation account under s. 20.435 (5) (bc). All funds allocated by the
25department but not encumbered by December 31 of each year lapse to the general

1fund on the next January 1 unless transferred to the next calendar year by the joint
2committee on finance.
AB232,6 3Section 6. 20.437 (2) (L) of the statutes is amended to read:
AB232,5,124 20.437 (2) (L) Public assistance overpayment recovery, fraud investigation, and
5error reduction.
All moneys received as the state's share of the recovery of
6overpayments and incorrect payments under s. 49.191 (3) (c), 1997 stats., and s.
749.195, 1997 stats., for any contracts under s. 49.845 (4), for any activities under s.
849.197 (1m) to investigate fraud relating to the Aid to Families with Dependent
9Children program and the Wisconsin Works program, for any activities under s.
1049.197 (3) to reduce payment errors in the Wisconsin Works program, for reward
11payments under s. 49.849 (3),
and for costs associated with collection of public
12assistance overpayments.
AB232,7 13Section 7. 49.793 (2) (a) of the statutes is amended to read:
AB232,5,2214 49.793 (2) (a) Except as provided in par. (b), a county, multicounty consortium,
15as defined in s. 49.78 (1) (br), or governing body of a federally recognized American
16Indian tribe may retain a portion of the full amount of an overpayment the state is
17authorized to retain under 7 USC 2025 that is recovered under sub. (1) due to the
18efforts of an employee or officer of the county, multicounty consortium, or tribe. The
19department shall promulgate a rule establishing the portion of the amount of the
20overpayment that the county, multicounty consortium, or governing body may
21retain.
This paragraph does not apply to recovery of an overpayment that was made
22as a result of state, county, multicounty consortium, or tribal governing body error.
AB232,8 23Section 8. 49.846 of the statutes is created to read:
AB232,6,3
149.846 Optional incentive program for counties and tribes that
2identify fraud in certain public assistance programs.
(1) Definitions. In this
3section:
AB232,6,54 (a) "County or tribe" means a county having a population of less than 750,000
5or a federally recognized American Indian tribe or band in this state.
AB232,6,76 (b) "Food stamp program" means the federal food stamp program under 7 USC
72011
to 2036a.
AB232,6,88 (c) "Medical Assistance program" means the program under subch. IV.
AB232,6,99 (d) "Wisconsin Works" has the meaning given in s. 49.141 (1) (p).
AB232,6,18 10(2) Public assistance programs administered by the department of health
11services.
(a) Medical Assistance program. The department of health services shall
12establish an optional incentive program, by rule, under which the department will
13provide a reward payment to a county or tribe if an employee or officer of the county
14or tribe identifies fraudulent activity in the Medical Assistance program. The
15department of health services may make reward payments under the optional
16incentive program from the appropriations under s. 20.435 (4) (bm), (L), (nn), and
17(pa). The department of health services shall establish the optional incentive
18program to include all of the following:
AB232,6,2119 1. That a county or tribe shall choose to receive a reward payment in the
20amount determined under subd. 2. or to retain funds under s. 49.49 (5) or 49.497 (2)
21(a).
AB232,7,422 2. That the amount of a reward payment to a county or tribe under the program
23is equal to 20 percent of the amount that the department determines will be saved
24in the Medical Assistance program as the result of eliminating the identified
25fraudulent activity during the 12-month period after the fraudulent activity is

1eliminated. Notwithstanding ss. 49.49 (5) and 49.497 (2) (a), a county or tribe that
2receives a reward payment may not retain any funds that are incorrectly paid as the
3result of the identified fraudulent activity and recovered due to the efforts of an
4employee or officer of the county or tribe.
AB232,7,115 (b) Food stamp program. The department of health services shall establish an
6optional incentive program, by rule, under which the department will provide a
7reward payment to a county or tribe if an employee or officer of the county or tribe
8identifies fraudulent activity in the food stamp program. The department of health
9services may make reward payments under the optional incentive program from the
10appropriations under s. 20.435 (4) (bm), (L), (nn), and (pa). The department shall
11establish the optional incentive program to include all of the following:
AB232,7,1312 1. That a county or tribe shall choose to receive a reward payment in the
13amount determined under subd. 2. or to retain funds under s. 49.793 (2) (a).
AB232,7,2014 2. That the amount of a reward payment to a county or tribe is equal to 20
15percent of the amount that the department determines will be saved in the food
16stamp program as the result of eliminating the identified fraudulent activity during
17the 12-month period after the fraudulent activity is eliminated. Notwithstanding
18s. 49.793 (2) (a), a county or tribe that receives a reward payment may not retain any
19funds that are incorrectly paid as the result of the identified fraudulent activity and
20recovered due to the efforts of an employee or officer of the county or tribe.
AB232,8,4 21(3) Public assistance program administered by the department of children
22and families; Wisconsin Works.
The department of children and families shall
23establish an optional incentive program, by rule, under which the department will
24provide a reward payment to a county or tribe if an employee or officer of the county
25or tribe identifies fraudulent activity in Wisconsin Works. The department of

1children and families may make reward payments under the optional incentive
2program from the appropriation under s. 20.437 (2) (dz), (L), and (mc). The
3department of children and families shall establish the optional incentive program
4to include all of the following:
AB232,8,75 (a) That a county or tribe shall choose to receive a reward payment in the
6amount determined under par. (b), to receive a reward under the incentive program
7under s. 49.197 (2), or to retain funds under s. 49.195 (4).
AB232,8,168 (b) That the amount of a reward payment paid to a county or tribe is equal to
920 percent of the amount that the department determines will be saved in Wisconsin
10Works as the result of eliminating the identified fraudulent activity during the
1112-month period after the identified fraudulent activity is eliminated.
12Notwithstanding ss. 49.195 (4) and 49.197 (2), a county or tribe that receives a
13reward payment may not retain any funds that are incorrectly paid as the result of
14the identified fraudulent activity and recovered due to the efforts of an employee or
15officer of the county or tribe and may not receive a reward payment under s. 49.197
16(2).
AB232,8,18 17(4) Use of reward payment. A county or tribe may use a reward payment
18received under this section for any purpose.
AB232,8,25 19(5) Waivers. (a) If the department of health services determines that it needs
20a waiver to allow reward payments under sub. (2) (a) to qualify as administrative
21costs for the Medical Assistance program or to allow a county and tribe to use any
22federal funds received under sub. (2) (a) for any purpose, the department shall
23request the necessary waiver from the secretary of the federal department of health
24and human services and may not implement the incentive program under sub. (2)
25(a) unless the waiver is granted.
AB232,9,7
1(b) If the department of health services determines that it needs a waiver to
2allow reward payments under sub. (2) (b) to qualify as administrative costs involved
3in the operation of the food stamp program or to allow a county and tribe to use any
4federal funds received under sub. (2) (b) for any purpose, the department shall
5request the necessary waiver from the secretary of the federal department of
6agriculture and may not implement the incentive program under sub. (2) (b) unless
7the waiver is granted.
AB232,9,158 (c) If the department of children and families determines that it needs a waiver
9to allow reward payments under sub. (3) to qualify as state expenditures for purposes
10of determining whether the state is maintaining a certain level of historic support
11under the temporary assistance for needy families program under 42 USC 601 to 619
12or to allow a county and tribe to use any federal funds received under sub. (3) for any
13purpose, the department shall request the necessary waiver from the secretary of the
14federal health and human services and may not implement the incentive program
15under sub. (3) unless the waiver is granted.
AB232,9,1616 (End)
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