collecting hard to collect earnings: finding the right tool for the job moderator: diane hogan,...
TRANSCRIPT
COLLECTING HARD TO COLLECTEARNINGS:
FINDING THE RIGHT TOOL FOR THE JOB
Moderator: Diane Hogan, Informatix Inc. Speaker: Matt Marsolais, OCSE
Speaker: Andrew Szymak, Oklahoma CSS ERICSA 50th Annual Training Conference & Exposition ▪ May 19 – 23 ▪ Hilton Orlando Lake Buena Vista, Florida
Agenda
• Multistate Financial Institution Data Match Program
• Thrift Savings Plan Match• Federally Assisted State Transmitted Levy • Insurance Match Program• Debt Inquiry Service for Insurers
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Multistate Financial Institution Data Match (MSFIDM) Legislation
• 1996– Required state IV-D agencies to enter into
matching agreements with financial institutions (FI) conducting business in their state to obtain account information about delinquent obligors
• 1998– Authorized OCSE to conduct a centralized match
for those FIs conducting business in two or more states
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MSFIDM Information
• Over 4,500 financial institutions participate• Matches are conducted on a quarterly basis• Match data is provided to states through the
Federal Case Registry (FCR)• States use their freeze and seize procedures to
collect past-due support
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MSFIDM Success
• FIs return on average 4 million matches per quarter associated with 1.7 million unique SSNs
• States voluntarily report collections– $ 20.9 million in 2000– $144 million in 2011– $110 million in 2012 (still collecting data)
• $1.31 billion collected since program inception
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Thrift Savings Plan (TSP)
• Retirement plan offered to federal civilian employees and members of the military
• Partnership between OCSE and Federal Retirement Thrift Investment Board (FRTIB) – responsible for administering the TSP
• Quarterly matches implemented in 2011
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TSP Success
• States have voluntarily reported $20.4 million• All but four states garnish TSP accounts!
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State Collections
Texas $13,577,062
Illinois $ 2,601,662
Tennessee $ 1,651,442
Arizona $ 908,880
Oklahoma $ 672,589
Florida $ 426,981
Federally Assisted State Transmitted (FAST) Levy Pilot
• Automate freeze/seize process between states and FIs– Process flow– OCSE as the “conduit”
• Pilot participants– FIs: JPMorgan Chase, Bank of America,
Wells Fargo, US Bank, Navy Federal Credit Union– States: California, District of Columbia, New Jersey,
Pennsylvania, Tennessee, Washington 8
FAST Levy Pilot
• Progress to date– Meetings/Conference Calls– Record Layout
• Timeframe• Next Steps
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Insurance Match (IM) Program
• Authorized by Section 452(l) [to be redesignated (m)]of the Social Security Act – OCSE works with insurers or their agents and state
workers’ compensation agencies to compare information about individuals who owe past-due support with payee information on insurance claims, settlements, payments and awards
– Information provided to states so they can intercept payouts and apply to past-due support
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IM Program
• Participation is voluntary for states and insurers– Currently matching with
• 22 State Workers’ Compensation Agencies• 756 Insurers through the Insurance Services Office • U.S. Department of Labor
– Matches since program inception: 351,473– 25 of the 53 states/territories voluntarily reported
collections totaling over $18 million
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Debt Inquiry Service (DIS)for Insurers
• Web-based application on the FPLS portal lets insurers report upcoming lump sum and other payments
• What happens when there’s a match?– Insurers receive information about the state(s)
that is responsible for collecting past-due support– States receive match notification so they can take
action
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MISSED COLLECTION CHALLENGES AND THEIR SOLUTIONS (IN OTHER WORDS, FINDING THE
RIGHT TOOL)
WHAT ARE THE MISSED COLLECTION CHALENGES?
-FIDM (Financial Institution Data Match)-Instate matching opportunities
-Thrift Savings Plan (TSP)
-Insurance Matching
-Alaska Permanent Dividend Fund
-BP Oil Spill a.k.a. Gulf Coast Cleanup Fund
-Interstate Unemployment Insurance Benefit (UIB) Intercept
-Social Security Administration (SSA) Intercepts
-Limited Services a.k.a. AEI
FIDM Instate Matching Opportunities
-Challenge: A large number of FIDM matches are missed because states are not sharing Instate bank match data
-Solution: Make access to Instate bank account data a simple and effective process
Access to Out-of-State FIDM Matches
-Two sources of matches-Multi-State FIDM (e.g., Bank of America,
Chase, Regions, Wells Fargo)-In-state matches
In-houseAlliance or consortium
FIDM Alliance
-Made up of 18 states entering into an Alliance to outsource in-state FIDM programs.
-Formed to cooperatively develop, issue and oversee these FIDM operations.
-Cross border FIDM matching done on a state to state agreement basis.
FIDM Alliance (Continued)
-Each participating state is responsible for entering into individual contracts with the selected contractor that oversees the program.-Texas is the lead state of the Alliance for the
purpose of procurement
Interstate Data Exchange Consortium - IDEC
-Oklahoma receives its Interstate FIDM matches through IDEC. What is IDEC?
-A partnership of 15 states for the collection and enforcement of child support
Interstate Data Exchange Consortium – IDEC (Continued)
-Access to accounts in all member states
-Operated as a state-administered, state-owned system
-Managed by the State of South Carolina
FIDM Limited Partnerships
-IDEC offers a Limited Partnership that allows non-member states to participate in the
quarterly interstate matching of Full Member states
-Limited Partners become reciprocal partners with IDEC member states
Two types of Limited Partnerships with IDEC
-FIDM Alliance member states
-Independent FIDM states
Oklahoma and Texas Limited Partnership Collections
-Oklahoma is an IDEC member
-Overall Oklahoma 2012 FIDM Collections:$3,216,748
Overall Oklahoma Collections from Limited Partnership participation: $580,530
-Texas is a member of the FIDM Alliance
-Overall Texas 2012 FIDM Collections:$36,099,858
Texas Overall Collections from Limited Partnership participation: $593,912
Thrift Savings Plan (TSP)
-Very good collection tool!
-Simple processing Use Income Withholding Order for State Agencies either by itself or as cover letter
-Cooperative agency / good customer support
Thrift Savings Plan (TSP) Collections
-Oklahoma Overall Collections:$807,053
-Texas Collections:$13,577,062
-Tennessee Collections:$2,015,945
Insurance MatchingPersonal Injury Claims
-Insurance matches are received on a daily basis from Child Support Lien Network
(CSLN) or OCSE.
-Matches go through an automated analyzer process
-Worker verifies insurance lien printedautomatically. Worker may also print out lien form manually
-Liens are printed at local offices forattorney signature.
-Liens are sent to insurance companyNCP, NCP’s attorney.
-56 O.S. Sect 237B – Mandatory
matching law.
-Claims of $500 or more
-Insurers authorized to do business
in Oklahoma
-Contact OCSS to verify if claimant
owes past due support
Workers Compensation Claims
-Insurance matches are received on a daily basis from CSLN, OCSE, OK state insurance fund and Workers Compensation Court
-Matches go through an automated analyzer process, similar to personal
injury cases
-Worker verifies insurance lien printed automatically. Worker may also print forms manually.
-Liens are printed at local office for attorney signature.
-IWOs are sent to collect on weekly temporary benefit payments
-Liens are sent to insurance company,NCP, NCP’s attorney and filedwith workers compensation courtby state office personnel.
-56 O.S. Sect. 237B – Mandatory matching law also applies to workers compensation claims
-Oklahoma Personal Injury Settlement Intercept 2012 Fiscal Year Collections:$1,339,225
-Workers Compensation SettlementIntercept 2012 Fiscal Year Collections:$,5,697,804 (IWO $1,923,385, Liens $3,774,419)
-Texas Overall Insurance Settlement Intercept 2012 Fiscal Year Collections:$34,511,816
-Tennessee Overall Insurance SettlementIntercept 2012 Fiscal Year Collections:$1,482,123
Attaching the Alaska Permanent Dividend Fund
-Alaska citizens’ percentage of state revenues from a variety of sources within the state
-To match with Alaska: Send inquiry file with NCP information matched against their Permanent Dividend Fund database.
Match information requested is Obligor’s name, SSN and DOB.
-Preferred method of transmitting inquiry file is using FTP, (using encrypted CDs is also
possible).
-To attach dividend: Send UIFSA transmittal 1, requesting that a garnishment go against the obligor’s dividend. Limited Services requests are sent back to Alaska in August.
-Funds are sent back to requesting state in October.
-Oklahoma yearly dividends collections range between $11K to $50K
-Texas dividend 2012 collections were $64,869
-Tennessee dividend 2012 collections were$7,817
BP Oil Spill a.k.a. Gulf Coast Cleanup Fund
-$20 Billion available for claims associated with the Deepwater Horizon oil spill
-Challenge: How to stake claims on money owed to noncustodial parents behind on their child support payments.
-Possible solution: Send an electronic list of NCP’s owing past due support to Gulf Coastal Cleanup Fund (GCFF)
-Problem: Out of 200,000 cases Oklahoma could find 21,926 NCPs with possible
connections to settlement funds
-Problem: GCFF said they would not take electronic lists so we were looking at subpoenas
-A lot of subpoenas. Stack of paper over 70 inches tall filling five paper boxes. They were sent to GCFF on November 12, 2010.
-Fortunately for GCFF we also included an encrypted CD with the same information
-Upon receipt of Oklahoma’s subpoenas and CD we received a call from GCFF telling us they would process our electronic file
-GCFF asked for IWOs on the specific matches (81 total). Hard copies and an additional electronic file was sent with the IWO information
-Oklahoma referred GCFF to OCSE in order to establish a nationwide procedure to get an electronic matching system in place
-Total payments Oklahoma received to date add up to $56,000. Initial payments were from smaller claims ranging from a few hundred dollars up to $3,500. The largest single payment to date being $16,250
-Total payment Texas received to date add up to $69,000
-Total payment Tennessee received to date add up to $25,163
Interstate Unemployment Insurance Benefits (UIB) Intercepts
-Challenge: OCSS received UIB information through the Federal Case Registry (FCR) but the data would sit on FCR until discovered by a child support specialist
-Solution: Automate the process to intercept Interstate UIB
How The Process Works-Two analyzers are involved in the automated process
-UIB Analyzer: Program runs on a daily basis looking for matches between FCR UIB claims and open OCSS cases in our system
-IWO Analyzer: If appropriate sends an Income Withholding Order to another state’s Employment Security Commission
State Classifications; Easy, Medium and Hard
-Easy: Direct Income Withholding Order (IWO) (10 states and one territory currently allow this). IN, MI, MN, NY, ND, OH, OK, PA, PR, TN and WI.
-If a state accepts IWOs directly, the system automatically sends an IWO to that state’s State Employment Security Commission (SESC).
-Medium: Limited Services Interstate Referral
-If a state does not accept IWOs but does accept Limited Services Interstate Referrals, the system prints a Limited Services Interstate Referral
document (UIFSA Transmittal 1) at the district offices printer.
-Worker sends the Limited Services referral with any other necessary documents to the other state’s interstate central registry.
-Hard: Full Service Interstate Referral.
-If a state does not accept direct IWOs or Limited Services Interstate Referrals, the system can not automate the process.
-The worker must prepare a Full Service Intergovernmental Referral and forward it to the appropriate state’s Interstate Central Registry.
2012 Interstate UIB Collections
-1,520 IWO’s were issued to direct UIB withholding states
-2012 Interstate UIB collections:$163,647
SSA Intercept Process
-Two types of collections from SSA
-Use e-IWO to intercept Social Security benefits
-Collect on lump sum payments
SSA IWO Process
-Process list of pending claims provided by SSA using automated process
-Only go after claims with Title 2 (SSD) benefits
-Presently send average of 950 IWOs to SSA each month
SSA Lump Sum Process
-OCSS receives e-mail or call from SSA payment center about lump sum payment. Average of 50 to 60 lump sum contacts per month.
-OCSS state office and Oklahoma Employer Services Center (OKESC)review case to verify principal and interest balances.
-We can ask for 100% of lump sum
-CCPA does not apply.-50% already goes to beneficiary
-Confirmation by phone from OCSS office regarding case status and balances.
-Key to success with SSA: Establish a solid working relationship with local SSA offices.
-Oklahoma Social Security Administration (SSA)Intercept 2012 Collections:$12.5 Million.
Limited Services a.k.a. AEI
-What can Limited Services requests be used for:-FIDM-Unemployment Insurance Benefit (UIB) Intercepts-Personal Injury claims-Workers Compensation claims-Liens in Probate cases
-Service of Process
-State Tax Intercept
-Other types of assess (you name it and we will try to collect it).
How to Work Incoming Limited Services Referrals (Oklahoma’s Perspective)
-Build case and obligation in our system-Most cases will require UIFSA Transmittal 1,
copy of arrearage computation and order. Also specific information on
asset to be attached.-Note: Some states may only require the use of the UIFSA Transmittal 3 form.
-Prepare and send appropriate notices and other documents to all necessary parties
-If contacted by obligor , work with the Requesting State to assist with review and hearing request
-Receive attached funds and forward to Requesting State and close case. -Both states will be able to report the collection
2011 Limited Services Collections
-Oklahoma received 46 limited services requests. 32 actions were successful with $106,449 in collections.
-Texas collected $374,558 in outgoing referrals.
Contact
Andrew SzymakOklahoma Child Support Services
FIDM Coordinator
E-mail: [email protected]: (405) 522-6230
Fax: (405) 522-4570