Washington

How To Fight an Overpayment of Cash Assistance, Medical Assistance or Food Stamps

Authored By: Northwest Justice Project LSC Funded
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What is an overpayment?

An overpayment happens when you get benefits you are not eligible for according to Department of Social & Health Services (DSHS) rules.

DSHS gets the benefits back by charging you with an overpayment. There are three kinds of overpayments:

  • An intentional overpayment happened when you purposely did not give DSHS information that you knew you should have, OR you purposely gave DSHS wrong information about your situation.

  • An unintentional payment happened because of a mistake.

  • An overpayment is an "administrative error" if DSHS made a mistake.

If DSHS says the overpayment is intentional, they may refer your case to the county prosecuting attorney for charges of welfare fraud. If you are charged with a crime, ask for a public defender. Do not make any statements to DSHS until you have talked with a lawyer.

May I appeal the overpayment?

You may fight the overpayment by asking for an administrative hearing. You may want to argue any or all of the following:

  • whether there was an overpayment at all

  • the amount of the overpayment

  • whether you should have to pay back an unintentional overpayment

  • whether the overpayment was intentional

  • For food stamps only:  Whether DSHS has acted timely (see section following #4 below for further information about this)

You may do any of these by asking for an administrative hearing and arguing any of the following: 

  • There is no overpayment. Example:  if DSHS says that they overpaid you because they think your car is worth more than it is, you can provide proof that its value is within the amount the rules allow. Another example:  DSHS may say that you own a bank account with too much money in it, when it is actually your grandmother's account. Your name is on it only for your grandmother's convenience. You can prove it by having your grandmother make a statement to the administrative law judge.

  • The overpayment amount is lower than DSHS says. If it is a financial assistance overpayment, ask if DSHS collected any child support during the period that the overpayment happened. If so, DSHS should lower the overpayment amount by the amount of child support paid. Or, you may have been eligible for another category of assistance. Any amount DSHS should have paid you, but did not, is an underpayment. (Example 1:  If you asked for emergency assistance and were eligible but did not get any. Example 2: You reported an additional person in your family. You should have gotten more benefits. You did not.)  An underpayment can offset against the overpayment. It does not matter how long ago the underpayment happened.

  • If the overpayment in cash or medical assistance only was DSHS' mistake, it is an administrative error. You may ask the administrative law judge for a waiver of repayment under "equitable estoppel."  A waiver means you will not have to pay DSHS back for the overpayment. See our publication How to Present an Equitable Estoppel Defense if you told DSHS everything that you should have and they made a mistake and paid you too much anyway. You may not use this argument in food stamp cases.

  • If the overpayment in your food assistance case was DSHS' mistake, you should ask for an administrative hearing and then contact the Office of Financial Recovery (OFR) to ask them to waive (cancel) or compromise (lower) the overpayment amount. Contact OFR by phone at 1-800-562-6114. Their mailing address is POB 9501, Olympia WA  98507-9501.

  • If DSHS says the overpayment was intentional and you disagree, tell the administrative law judge why. An intentional overpayment happens when you did not tell DSHS something you knew you should have OR you told them a lie in order to get assistance. If you agree that it was intentional, do not discuss it with DSHS. If you are facing criminal charges, discuss the matter only with your lawyer. If you are facing criminal charges and cannot afford a lawyer, ask the court to appoint a lawyer for you.

Food stamp overpayments only:  The food stamp law says DSHS must discover the overpayment within certain time limits. Within certain time limits from discovering the overpayment, DSHS must send you a notice that tells you the amount of overpayment and the reason it happened.

The time limits are different, depending on the type of overpayment:

  • "Administrative error" overpayments:  Twelve months to discover the overpayment; no more than 24 months from discovery to notify you.

  • "Inadvertent household error" overpayments:  24 months to discover the overpayment; 24 months from discovery to notify you.

  • "Intentional" overpayments: 72 months to discover the overpayment; 24 months from discovery to notify you.

If DSHS has not met the time limits, they should not charge you with an overpayment. You should ask DSHS to dismiss the overpayment against you.  If DSHS will not do that, ask for an administrative hearing. At the hearing, ask the Administrative Law Judge to dismiss the overpayment notice because it is not timely.

  • Example:  DSHS notifies you on November 1, 2012, that they overpaid you, due to administrative error, for the months of July and August 2009. You should ask the ALJ to dismiss the case because DSHS did not act timely.   

How do I ask for an administrative hearing?

You fill out a Hearing Request form at your local DSHS office or write the Office of Administrative Hearings, P.O. Box 42489, Olympia, WA 98504 to say you want an administrative hearing. If it is an emergency, call the Office of Administrative Hearings nearest you. Ask them to hold your hearing as soon as possible. (Go to www.oah.wa.gov/. Click on "Contact" for the right phone number.) 

You must ask for the hearing no later than 90 days from the date that DSHS mailed the overpayment notice. If you are currently on assistance and DSHS has said they will lower your check, you can keep getting your full amount until the ALJ makes a hearing decision if you request the hearing within ten days of the date DSHS mailed the notice. You will get a notice of the time and date of the hearing in the mail.

Our publication Representing Yourself at an Administrative Hearing explains to find out how to get information about your case, prepare for and go to an administrative hearing.

How does DSHS recover overpayments?

Cash – DSHS can collect from the grants of any/all members of an overpaid assistance unit, even if they are not still on the same grant.

Cash & Medical - intentional overpayments:  If DSHS determines that a cash assistance overpayment was intentional, it will take ten percent from your current grant. DSHS will collect until it has recovered the full overpayment amount.

Cash & Medical - unintentional overpayments:  DSHS will take five percent of your cash grant, unless you request a larger deduction in writing, until it has recovered the full overpayment amount.

Food assistance – Only the adult members of an overpaid food assistance household are liable for the overpayment.

  • Intentional:  If an overpayment was due to an intentional program violation, the mandatory reduction is either twenty percent of the monthly benefit amount or twenty dollars a month, whichever is more.

  • Unintentional:  If an overpayment was unintentional, the mandatory reduction is either ten percent of the monthly benefit amount or ten dollars a month, whichever is more. You may also agree in writing to a payment plan with a larger reduction in benefits to pay off the overpayment more quickly.

  • Administrative error:  If DSHS or an ALJ grants your request for a waiver of this type of overpayment, based on equitable estoppel, then DSHS forgives the overpayment. (They will never collect it.) Otherwise, the reduction is the same as for unintentional overpayments: either ten percent of the monthly benefit amount or ten dollars a month, whichever is more.

Continuing Benefits:  If you request an administrative hearing within ten days before a proposed termination of public assistance benefits, DSHS must continue your benefits through the month in which the administrative law judge makes a decision in your hearing. The only exception to this is that you will get food assistance only through the end of your current food assistance certification period.

*If you lose your hearing, DSHS can collect up to 60 days' worth of the continued cash and medical benefits.  For food assistance there is no 60-day limit. DSHS can collect all overpaid food assistance benefits.

I had a food assistance overpayment. What if I do owe the overpayment?

DSHS or a judge at an administrative hearing can reduce the overpayment amount in part or full if they find that repaying the money will cause you financial hardship.  You can fill out and use the attached monthly budget form to show financial hardship.

Factors DSHS will consider in reducing or writing off overpayments:

  • You are unable to repay the balance or doing so would be a hardship.

  • The overpayment claim is incorrect in whole or part.

  • All of the adults responsible for the overpayment have died.

  • A balance of less than $25 is at least 90 days late.

  • It would cost DSHS more to collect the money than you owe.

  • DSHS agreed to accept partial payment.

  • The overpayment claim has been unpaid for three or more years (unless DSHS plans to recover the overpayment by, for example, taking your tax return).

  • You have already paid the greater of ten percent of your monthly food assistance benefits or ten dollars a month for 36 months on an administrative or inadvertent household error overpayment. 

  • An administrative law judge orders DSHS to reduce or write off the overpayment.

I am no longer on public assistance. How will DSHS recover the overpayment from me?

DSHS may refer your overpayment(s) for federal collection if:

  • an overpayment debt is more than 180 days past due

  • you are not meeting the terms of a scheduled repayment agreement

  • you no longer get public assistance

Federal collection allows DSHS to garnish your tax refund and Social Security benefits (if your benefit amount is more than $750/month). It also allows DSHS to use collection methods available to all creditors such as garnishment of your wages and bank accounts, and filing of liens against your property.  You may avoid a potential garnishment by negotiating a repayment agreement with DSHS based on your monthly expenses and what you can afford to pay. See WAC 388-410 (Benefit Error).

What if I need legal help?

CLEAR is Washington's toll-free, centralized intake, advice and referral service for low-income people seeking free legal assistance with civil legal problems. 

  • Outside King County: Call 1-888-201-1014 weekdays from 9:10 a.m. until 12:25 p.m.  CLEAR works with a language line to provide callers with free interpreters as needed.  If you are deaf or hard of hearing, call 1-888-201-1014 using your preferred TTY or Video relay service.

  • King County: Call 211 for information and referral to an appropriate legal services provider Monday through Friday from 8:00 am – 6:00 pm. You may also call (206) 461-3200, or the toll-free number, 1-877-211-WASH (9274). 211 works with a language line to provide callers with free interpreters as needed. Deaf and hearing-impaired callers can call 1-800-833-6384 or 711 to get a free relay operator. They will then connect you with 211. You can also get information on legal service providers in King County through 211's website at www.resourcehouse.com/win211/.

  • Persons 60 and Over: Persons 60 or over may call CLEAR*Sr at 1-888-387-7111, regardless of income.

 

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This publication provides general information concerning your rights and responsibilities. It is not intended as a substitute for specific legal advice.
This information is current as of July 2014.

© 2014 Northwest Justice Project — 1-888-201-1014
(Permission for copying and distribution granted to the Alliance for Equal Justice and to individuals for non-commercial purposes only.)