Sometimes a person who is receiving a public benefit (like FIP, food assistance (SNAP), or Medicaid) from Iowa’s Department of Health and Human Services (HHS) receives more money than he or she should or gets a benefit the person should not have received at all. When that happens, the extra money is called an overpayment. Sometimes it happens because the person forgets to report a change in income, or receipt of money that would be considered a resource. Sometimes it happens because HHS makes a mistake. HHS may send money or provide a benefit to a recipient and later decide that what they provided was not correct.
If you get an overpayment from HHS, be sure to know the answers to three important questions.
What does HHS do if they give you benefits by mistake?
• If HHS decides you were overpaid, they will ask you to pay back the money.
• A Notice of Overpayment is sent to you.
What options are available to a person who gets a notice of overpayment from HHS?
• If you disagree with what the Notice of Overpayment says, you have the right to appeal.
• To file an appeal, either appeal online at https://hhs.iowa.gov/appeals, by email at appeals@dhs.state.ia.us, by phone at 1-800-532-1275, in person at your local DHS office, or send a letter to DHS, with your name, the date and your case number.
• The letter should say you are appealing an overpayment notice. Be sure to give the date on the overpayment notice.
• A hearing will be scheduled on your appeal. The hearing will give you the chance to show why you think there was not an overpayment to you.
• HHS can waive recovery of a FIP overpayment if you are no longer receiving FIP and the overpayment is less than $35.00 as long as the overpayment was not the result of fraud and the overpayment has been held in suspense for three years.
How can HHS collect an overpayment?
HHS can reduce the amount of your future FIP payments until the extra money is paid back.
- When someone is overpaid FIP solely because of a HHS error, that overpayment is collected from future FIP payments at a rate of 1% of the FIP payment.
- When someone is overpaid FIP due to client error or a combination or HHS and client error, that overpayment is collected from future FIP benefits at a rate of 10% of the amount of each FIP payment.
- When benefits were continued during an appeal that was eventually denied, the overpayment is collected starting no later than the month after the month in which the final decision is issued.
Example: If your FIP payment is normally $361.00 per month, then 1% of that is $3.61 per month; 10% of that is $36.10 per month. If you no longer get FIP, you are expected to pay at least $50 per month toward the overpayment.
HHS can reduce the amount of future SNAP payments until the extra money is paid back. For inadvertent household error and administrative error claims. DHS will withhold 10% or $10 from future payments (whichever is more). For intentional program violation claims, HHS will withhold 20% or $20 (whichever is more).
HHS can pursue other collection methods as well, such as:
- Federal income tax offsets;
- Taking money out of other federal payments to repay a food assistance overpayment when a person no longer takes part in the program;
- State income tax offsets;
- Withholding payments for food assistance, FIP and Medicaid;
- From lottery winnings;
- Estates (if a person has passed away); and
- By bringing a court action.
Helping low-income Iowans who face legal problems impacting a basic family need like income is a priority for Iowa Legal Aid. To find out if help is available for a legal problem you may have, call Iowa Legal Aid at 1-800-532-1275.