Legislature(2003 - 2004)
04/16/2004 01:38 PM Senate HES
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
SB 376-SUBPOENA POWER: PUB ASS'TNCE & PERM FUND The committee took up SB 376. MR. JIM DALMAN, Chief of Program Integrity and Analysis, Department of Health and Social Services (DHSS), explained that when investigating allegations of welfare fraud, the department could not always obtain needed information from various sources even though a release of information is used. DHSS hopes the subpoena would allow information to be more readily collected. It provides a helpful tool to speed up the procurement of information from institutions or individuals to help validate the circumstances of a given allegation and to obtain information. This power is granted to other state agencies and is used as an administrative tool. CHAIR DYSON asked the administration's position on amending SB 376 to include the Permanent Fund Dividend Division. MR. DALMAN responded he didn't see this as a problem, and would probably help with their investigations. CHAIR DYSON said he is pleased the administration is pursuing fraud in all areas. MR. ANTHONY LOMBARDO, Director, Division of Public Assistance (DPA), noted there was no objection to having the PFD Division use this as a tool to pursue fraud. MR. JAY MARLEY, Manager, Fraud Control Unit, said he was available to answer questions, and commented this was a valuable tool to prosecute and investigate fraud. CHAIR DYSON said he would enjoy seeing published quarterly results of fraud control, as he was interested in who the perpetrators are, how easy it is to get convictions, what the sentences are, and how often there is success in getting restitution. SENATOR GUESS said it is important to look at "why the fraud happens," noting she has constituents who are confused by the paperwork. She referred to the fiscal note's positive/negative aspect, and asked, "Are they both savings, or is there an actual cost?" MR. MORLEY responded two types of figures are addressed when someone has gotten benefits illegitimately. The first is the actual recovery of benefits, the paying of benefits one wasn't entitled to. Second, disqualification for further benefits results in program savings. There are program savings, due to money coming back into the agency, and there are program savings resulting from not paying the benefit to those clients. SENATOR GUESS suggested a review of the fiscal notes, as they don't necessarily mesh with that explanation; it looks like there is a cost, and it should be a savings. CHAIR DYSON commented he would pay attention to this in the Senate Finance hearing. MR. DALMAN said there is some cost associated with the activity and there is an offset in savings coming from recovery. The recoveries are expected to be offset by expenditures on the other side of the program. There is a commensurate reduction in the benefit levels of other programs, based on the anticipated increases in recovery. There is the positive recovery of a benefit, a small increment, and also a reduction in the authority in the other programs, an expenditure the department wouldn't, therefore, be making; he said he would confirm this. MS. SHARON BARTON, Director, Permanent Fund Dividend Division, said its fraud unit is being re-built, and the desire is to get these essential tools and authorities in place because although the division can go to court for subpoena power, that process is cumbersome. She expressed interest in amending SB 376, using the same language as DPA. She reported the governor's liaison office is pleased for this opportunity, and DPA sees no problem with the PFD Division joining this. SENATOR BETTYE DAVIS questioned whether there would need to be a title change. CHAIR DYSON confirmed this was correct. He said conceptual amendment [Amendment 1] adds the PFD Division to the title on line 1, and the content change would be in Section 2. SENATOR DAVIS moved to adopt Amendment 1. CHAIR DYSON clarified this includes a new Section 2, as indicated by a document presented to the HES committee from the PFD Division, dated 4/14/04, accordingly numbered at the upper right side of the page as T-200, P.02, F-970. CHAIR DYSON asked if there was any objection to Amendment 1. Seeing none, it was adopted. SENATOR GUESS recommended that that SB 376 be referred to Senate Judiciary since it deals with subpoena powers. She also suggested that the title be fairly tight, since PFD was being added to the title. CHAIR DYSON said he would mention this to the Senate President. SENATOR DAVIS moved to report CSSB 376(HES) out of committee with [individual recommendations] and attached fiscal notes. CHAIR DYSON asked if there was any objection. Seeing and hearing none, it was so ordered.