Senate File 505 S-3163 Amend Senate File 505 as follows: 1 1. Page 119, after line 25 by inserting: 2 < DIVISION ___ 3 WELFARE FRAUD PREVENTION 4 Sec. ___. DEFINITIONS. For the purposes of this 5 division of this Act, unless the context otherwise 6 requires: 7 1. “Department” means the department of human 8 services. 9 2. “Identity information” means an applicant or 10 recipient’s full name, aliases, date of birth, address, 11 social security number, and other related information. 12 Sec. ___. ESTABLISHMENT OF ENHANCED ELIGIBILITY 13 VERIFICATION SYSTEM. 14 1. The department shall establish a computerized 15 income, asset, and identity eligibility verification 16 system to verify eligibility, eliminate duplication of 17 assistance, and deter waste, fraud, and abuse within 18 each respective assistance program under the purview 19 of and administered by the department. The department 20 shall enter into a competitively bid contract with a 21 third-party vendor for the purposes of developing and 22 implementing such a system to verify the income, asset, 23 and identity information of applicants when determining 24 an applicant’s eligibility for assistance prior to 25 the distribution of benefits, periodically between 26 eligibility redeterminations, and during eligibility 27 redeterminations and reviews as specified in this 28 section. 29 2. When the department enters into a contract with 30 a third-party vendor for the purposes of carrying out 31 this division of this Act, payment to the vendor for 32 such services shall be contingent upon the annualized 33 savings realized by implementation of the verification 34 system as specified in the contract exceeding the total 35 yearly cost to the state for implementation of the 36 verification system. 37 3. When the department enters into a contract with 38 a third-party vendor for the purposes of carrying out 39 this division of this Act, the payment structure shall 40 be based on a per-applicant rate and may include a 41 performance bonus for achieving above a predetermined 42 rate of success in identifying waste, fraud, and abuse. 43 4. To avoid any conflict of interest, when the 44 department enters into a contract with a third-party 45 vendor for the purposes of carrying out this division 46 of this Act, that primary vendor shall not currently 47 be and shall not be allowed in the future to bid on 48 a contract to be the state contractor to administer 49 enrollment services. 50 -1- SF505.1826 (3) 86 pf/rj 1/ 9 #1.

5. This division of this Act shall not be 1 interpreted to preclude the department from continuing 2 to conduct additional eligibility verification 3 processes not specified in this division of this Act, 4 that are not currently practiced. 5 6. Under the system implemented pursuant to this 6 division of this Act, all applications for benefits 7 shall be processed within a ten-day period or the 8 minimum period required by federal law. 9 7. Under the system implemented pursuant to this 10 division of this Act, prior to awarding or continuing 11 assistance, and on a quarterly basis thereafter, the 12 department shall verify identity information for each 13 respective applicant for and recipient of assistance 14 from the department against the following to the extent 15 such information or database is available: 16 a. Earned and unearned income information 17 maintained by the internal revenue service. 18 b. Employer weekly, monthly, or quarterly 19 reports of income and unemployment insurance payment 20 information maintained by the department of workforce 21 development. 22 c. Earned income information maintained by the 23 United States social security administration. 24 d. Immigration status information maintained by the 25 United States citizen and immigration services. 26 e. Death register information maintained by the 27 United States social security administration. 28 f. Prisoner information maintained by the United 29 States social security administration. 30 g. Public housing and section 8 housing assistance 31 payment information maintained by the United States 32 department of housing and urban development. 33 h. National fleeing felon information maintained by 34 the United States federal bureau of investigation. 35 i. Wage reporting and similar information 36 maintained by states contiguous to Iowa. 37 j. Beneficiary records and earnings information 38 maintained by the United States social security 39 administration in its beneficiary and earnings data 40 exchange database. 41 k. Earnings and pension information maintained by 42 the United States social security administration in its 43 beneficiary earnings exchange record system database. 44 l. Employment information maintained by the 45 department of workforce development. 46 m. Employment information maintained by the United 47 States department of health and human services in its 48 national directory of new hires database. 49 n. Supplemental security income information 50 -2- SF505.1826 (3) 86 pf/rj 2/ 9

maintained by the United States social security 1 administration in its supplemental security income 2 state data exchange database. 3 o. Veterans’ benefits information maintained by the 4 United States department of health and human services 5 in the federal public assistance reporting information 6 system database. 7 p. Child care services information maintained by 8 the department. 9 q. Utility payments information maintained by the 10 state under the low-income home energy assistance 11 program. 12 r. Emergency utility payment information maintained 13 by state or local entities. 14 s. A database of all persons who currently hold a 15 license, permit, or certificate from any state agency, 16 the cost of which exceeds five hundred dollars. 17 t. Income and employment information maintained by 18 the child support recovery unit and the United States 19 department of health and human services office of child 20 support enforcement. 21 u. Earnings and pension information maintained by 22 the Iowa public employees’ retirement system. 23 v. Any existing real-time database of persons 24 currently receiving benefits in other states, such as 25 the national accuracy clearinghouse. 26 w. A database which is substantially similar to or 27 a successor of a database described in this subsection. 28 8. Under the system implemented pursuant to this 29 division of this Act, prior to awarding or continuing 30 assistance and on a quarterly basis, the department 31 shall match identity information for each respective 32 applicant for and recipient of assistance from the 33 department against, at a minimum, all of the following 34 data sources, to the extent such data sources are 35 available: 36 a. A nationwide public records data source of 37 physical asset ownership such as real property, 38 automobiles, watercraft, aircraft, and luxury vehicles, 39 or any other vehicle owned by an applicant for or 40 recipient of assistance. 41 b. A nationwide public records data source of 42 incarcerated individuals. 43 c. A nationwide best-address and driver’s license 44 data source to verify that an individual is a resident 45 of this state. 46 d. A comprehensive public records database that 47 identifies potential identity fraud or identity theft 48 that can closely associate name, social security 49 number, date of birth, telephone, and address 50 -3- SF505.1826 (3) 86 pf/rj 3/ 9

information. 1 e. National and local financial institutions, in 2 order to locate undisclosed depository accounts or to 3 verify account balances of disclosed accounts. 4 f. Outstanding default or arrest warrant 5 information maintained by the Iowa online warrants 6 and articles criminal justice information network 7 maintained by the department of public safety. 8 g. A data source or database which is substantially 9 similar to or a successor of a data source or database 10 described in this subsection. 11 9. As part of the verification process, prior to 12 awarding assistance, applicants for benefits shall 13 complete a computerized identity authentication process 14 that shall confirm the applicant owns the identity 15 presented in the application. The department shall 16 review the respective applicant’s identity ownership 17 using the following procedures: 18 a. Provide a knowledge-based quiz consisting 19 of financial or personal questions. The quiz shall 20 attempt to accommodate nonbanked or under-banked 21 applicants who do not have an established credit 22 history. 23 b. Require the quiz for applications be available 24 to be submitted through a variety of approaches 25 including online, in-person, and via telephone. 26 10. If a discrepancy results between an applicant’s 27 or recipient’s identity information and information 28 available through one or more of the databases or 29 information tools specified in this section, the 30 department shall review the respective applicant’s or 31 recipient’s case using the following procedures: 32 a. If the information discovered does not result 33 in the department finding a discrepancy or change 34 in an applicant’s or recipient’s circumstances that 35 may affect eligibility, the department shall take no 36 further action. 37 b. If the information discovered results in the 38 department finding a discrepancy or change in a 39 recipient’s circumstances that may affect eligibility, 40 the department shall promptly redetermine eligibility 41 after receiving such information. 42 c. (1) If the information discovered results in 43 the department finding a discrepancy or change in an 44 applicant’s or recipient’s circumstances that may 45 affect eligibility, the applicant or recipient shall 46 be given an opportunity to explain the discrepancy. 47 However, a self-declaration by an applicant or 48 recipient shall not be accepted as verification 49 of categorical and financial eligibility during 50 -4- SF505.1826 (3) 86 pf/rj 4/ 9

eligibility evaluations, reviews, and redeterminations. 1 (2) The department shall provide written notice to 2 the applicant or recipient, which shall describe in 3 sufficient detail the circumstances of the discrepancy 4 or change, the manner in which the applicant or 5 recipient may respond, and the consequences of failing 6 to take action. The applicant or recipient shall have 7 ten business days, or the minimum period otherwise 8 required by state or federal law, to respond to an 9 attempt to resolve the discrepancy or change. The 10 explanation provided by the recipient or applicant 11 shall be provided in writing. After receiving the 12 explanation from the recipient or applicant, the 13 department may request additional documentation if 14 the department determines there is a risk of fraud, 15 misrepresentation, or inadequate documentation. 16 d. If the applicant or recipient does not respond 17 to the notice, the department shall deny or discontinue 18 assistance for failure to cooperate, in which case the 19 department shall provide notice of intent to deny or 20 discontinue assistance to the applicant or recipient. 21 Eligibility for assistance shall not be established or 22 reestablished until the discrepancy or change has been 23 resolved. 24 e. If an applicant or recipient responds to the 25 notice and disagrees with the findings of the match 26 between the applicant’s or recipient’s identity 27 information and one or more databases or information 28 tools utilized under this division of this Act, the 29 department shall reinvestigate the matter. If the 30 department finds that there has been an error, the 31 department shall take immediate action to correct 32 the error and no further action shall be taken. If, 33 after the reinvestigation, the department determines 34 that there has not been an error, the department shall 35 determine the effect on the applicant’s or recipient’s 36 case and take appropriate action. Written notice of 37 the respective department action shall be provided to 38 the applicant or recipient. 39 f. If the applicant or recipient agrees with 40 the findings of the match between the applicant’s 41 or recipient’s identity information and one or more 42 databases or information tools utilized under this 43 division of this Act, the department shall determine 44 the effect on the applicant’s or recipient’s case 45 and take appropriate action. Written notice of the 46 department’s action shall be provided to the applicant 47 or recipient. The department shall not discontinue 48 assistance upon finding a discrepancy or change 49 in circumstances between an individual’s identity 50 -5- SF505.1826 (3) 86 pf/rj 5/ 9

information and one or more databases or information 1 tools utilized under this division of this Act until 2 the applicant or recipient has been provided notice 3 of the discrepancy or change and the opportunity to 4 respond as required under this division of this Act. 5 11. a. Under the system implemented pursuant to 6 this division of this Act, after reviewing changes or 7 discrepancies that may affect program eligibility, the 8 department shall refer suspected cases of fraud to the 9 department of inspections and appeals, the office of 10 the attorney general, or other entity responsible for 11 prosecuting eligibility fraud relating to the programs 12 under the purview of the department for investigation 13 and possible criminal prosecution, recovery of improper 14 payments, and collection of civil penalties. 15 b. After reviewing changes and discrepancies that 16 may affect program eligibility, the department shall 17 refer suspected cases of identity fraud to the office 18 of the attorney general or other entity responsible for 19 prosecuting identity theft for criminal prosecution. 20 c. In cases of fraud substantiated by the 21 department, upon conviction, the state shall review all 22 legal options to remove the recipient from other public 23 programs and garnish wages or state income tax refunds 24 until the state recovers an equal amount of benefits 25 fraudulently received. 26 d. After reviewing changes or discrepancies that 27 may affect program eligibility, the department shall 28 refer suspected cases of fraud, misrepresentation, or 29 inadequate documentation to appropriate entities for 30 review of eligibility discrepancies in other public 31 programs. Such referral includes cases in which an 32 individual is determined to be ineligible for the 33 original program. 34 Sec. ___. REPORTING. Beginning July 1, 2016, and 35 quarterly thereafter, the department shall provide a 36 written report to the governor, the general assembly, 37 and the department of management detailing the 38 effectiveness and general findings of the eligibility 39 verification system implemented pursuant to this 40 division of this Act, including the number of cases 41 reviewed, the number of case closures, the number 42 of referrals for criminal prosecution, recovery of 43 improper payment, collection of civil penalties, 44 the outcomes of cases referred to the department of 45 inspections and appeals, the office of the attorney 46 general, or other entity responsible for prosecuting 47 eligibility or identity fraud under this division 48 of this Act, and the savings that have resulted from 49 implementation of the system. 50 -6- SF505.1826 (3) 86 pf/rj 6/ 9

Sec. ___. TRANSPARENCY IN THE MEDICAID 1 PROGRAM. The department shall electronically release 2 to the public data that includes but is not limited to 3 all of the following for each Medicaid provider: 4 1. The provider’s name and office location. 5 2. The provider’s national provider identifier. 6 3. The type of service provided, identified by 7 healthcare common procedure coding system code. 8 4. Whether the service was performed in a facility 9 or office setting. 10 5. The number of services provided, average 11 submitted charges, average allowed amount, average 12 Medicaid payment, and a count of unique Medicaid 13 beneficiaries treated. 14 Sec. ___. ADOPTION OF RULES. The department shall 15 adopt rules pursuant to chapter 17A to administer this 16 division of this Act. 17 Sec. ___. IMPLEMENTATION. This division of this 18 Act shall be implemented beginning January 1, 2016. > 19 2. By renumbering as necessary. 20 ______________________________ BILL ANDERSON ______________________________ JERRY BEHN ______________________________ RICK BERTRAND ______________________________ MICHAEL BREITBACH ______________________________ JAKE CHAPMAN ______________________________ MARK CHELGREN ______________________________ MARK COSTELLO -7- SF505.1826 (3) 86 pf/rj 7/ 9 #2.

______________________________ BILL DIX ______________________________ RANDY FEENSTRA ______________________________ JULIAN GARRETT ______________________________ DENNIS GUTH ______________________________ DAVID JOHNSON ______________________________ TIM L. KAPUCIAN ______________________________ KEN ROZENBOOM ______________________________ CHARLES SCHNEIDER ______________________________ JASON SCHULTZ ______________________________ MARK SEGEBART ______________________________ TOM SHIPLEY ______________________________ AMY SINCLAIR ______________________________ ROBY SMITH -8- SF505.1826 (3) 86 pf/rj 8/ 9