H.F. 429 Section 1. Section 217.35, Code 2013, is amended to read as 1 follows: 2 217.35 Fraud and recoupment activities. 3 1. Notwithstanding the requirement for deposit of recovered 4 moneys under section 239B.14 , recovered moneys generated 5 through fraud and recoupment activities are appropriated to the 6 department of human services inspections and appeals to be used 7 for additional fraud and recoupment activities performed by the 8 department of human services or the department of inspections 9 and appeals. The department of human services inspections and 10 appeals may use the recovered moneys appropriated to add not 11 more than five full-time equivalent positions, in addition 12 to those funded by annual appropriations. The appropriation 13 of the recovered moneys is subject to both of the following 14 conditions: 15 1. a. The director of human services the department of 16 inspections and appeals determines that the investment can 17 reasonably be expected to increase recovery of assistance paid 18 in error, due to fraudulent or nonfraudulent actions, in excess 19 of the amount recovered in the previous fiscal year. 20 2. b. The amount expended for the additional fraud and 21 recoupment activities shall not exceed the amount of the 22 projected increase in assistance recovered. 23 2. a. For the purposes of this subsection, “public welfare 24 programs” means welfare programs for persons with low income 25 that are wholly or partially funded by the federal government, 26 including but not limited to food programs administered under 27 section 234.12, state child care assistance administered under 28 section 237A.13, the family investment program and PROMISE-JOBS 29 program administered under chapter 239B, and the medical 30 assistance program administered under chapter 249A. The term 31 also includes programs with state-only funding directed to the 32 populations participating in the public welfare programs. 33 b. The authority granted to the department of human services 34 by federal or state statute or administrative rule to engage 35 -1- LSB 2201YH (9) 85 jp/nh 1/ 5

H.F. 429 in program evaluation, ensure program integrity, identify 1 or prevent fraud or abuse, address fraud or abuse, or other 2 related efforts in relation to public welfare programs shall 3 be deemed to extend to the department of inspections and 4 appeals. The department of human services shall collaborate 5 and coordinate with the department of inspections and appeals 6 in exercising this authority. 7 Sec. 2. Section 234.12A, Code 2013, is amended by adding the 8 following new subsections: 9 NEW SUBSECTION . 4. The same card or other benefit transfer 10 instrument used under the electronic benefits transfer program 11 for food assistance program benefits shall also be used to 12 provide family investment program cash assistance. 13 NEW SUBSECTION . 5. The department of human services’ 14 requirements for the electronic benefits transfer program 15 used to provide food assistance and family investment 16 program cash assistance shall require cancellation of a 17 card or other benefit transfer instrument that is lost or 18 stolen. The department shall implement an efficient process 19 for a cardholder to replace a lost or stolen card or other 20 instrument. 21 NEW SUBSECTION . 6. The department of human services’ 22 requirements for the electronic benefits transfer program used 23 to provide food assistance and family investment program cash 24 assistance shall provide that if the card or other benefit 25 transfer instrument may be used by more than one member of a 26 family or household, the card or other instrument shall bear 27 the name of each user. 28 Sec. 3. WELFARE FRAUD TASK FORCE. 29 1. A welfare fraud task force is created to review the 30 state laws, policies, procedures, and processes applied to 31 prevent and address fraud and abuse in public welfare programs 32 and make recommendations for improvements, including proposed 33 legislation. Staffing for the task force shall be provided 34 by the department of inspections and appeals. The provisions 35 -2- LSB 2201YH (9) 85 jp/nh 2/ 5

H.F. 429 considered by the task force may include but are not limited 1 to all of the following: 2 a. A review of the penalties for applicants or vendors 3 who provide false information and for any fraudulent use of 4 benefits. 5 b. A review of the current processes for information sharing 6 and data matching between the department of human services, 7 department of inspections and appeals, other relevant agencies 8 in this state, and comparable agencies of neighboring states. 9 c. A review of the potential for fraud and abuse that may be 10 caused by categorical eligibility provisions and of the methods 11 available to reduce that potential. 12 d. Identification of options for requiring a periodic 13 audit or other review to improve program integrity and program 14 processes. 15 2. The voting membership of the task force shall include all 16 of the following: 17 a. The director of the department of inspections and appeals 18 or the director’s designee. 19 b. The auditor of state or the auditor’s designee. 20 c. The director of human services or the director’s 21 designee. 22 d. The commissioner of public safety or the commissioner’s 23 designee. 24 e. A public member appointed by the director of the 25 department of inspections and appeals. 26 f. Other members with appropriate expertise appointed by 27 the task force. 28 3. The following members of the general assembly shall serve 29 in a nonvoting, ex officio capacity: 30 a. A member of the senate appointed by the majority leader 31 of the senate. 32 b. A member of the senate appointed by the minority leader 33 of the senate. 34 c. A member of the house of representatives appointed by the 35 -3- LSB 2201YH (9) 85 jp/nh 3/ 5

H.F. 429 speaker of the house of representatives. 1 d. A member of the house of representatives appointed by the 2 minority leader of the house of representatives. 3 4. The task force shall submit a final report to the 4 governor and general assembly on or before December 15, 2013, 5 making findings and recommendations. 6 5. For the purposes of this section, “public welfare 7 programs” means welfare programs for persons with low income 8 that are wholly or partially funded by the federal government, 9 including but not limited to food programs administered under 10 section 234.12, state child care assistance administered under 11 section 237A.13, the family investment program and PROMISE-JOBS 12 program administered under chapter 239B, and the medical 13 assistance program administered under chapter 249A. The term 14 also includes programs with state-only funding directed to the 15 populations participating in the public welfare programs. 16 EXPLANATION 17 This bill addresses fraud and abuse in public welfare 18 programs. 19 Code section 217.35, appropriating moneys recovered through 20 efforts to address fraud and recoupment activities, is amended 21 to provide the moneys are appropriated to the department of 22 inspections and appeals instead of the department of human 23 services and that authority granted to the department of human 24 services to engage in program evaluation, ensure program 25 integrity, identify or prevent fraud or abuse, address fraud or 26 abuse, or related efforts is deemed to extend to the department 27 of inspections and appeals. The two departments are required 28 to collaborate and coordinate in exercising this authority. 29 Code section 234.12A, relating to the electronic benefits 30 transfer program maintained by DHS for the food assistance 31 programs, is amended. The bill requires the electronic 32 benefits transfer program card or other benefit transfer 33 instrument utilized to provide food assistance program benefits 34 to also be used to provide family investment program cash 35 -4- LSB 2201YH (9) 85 jp/nh 4/ 5

H.F. 429 assistance. If a card or other benefit transfer instrument 1 used for the program is lost or stolen, the instrument must be 2 canceled. If a card or other benefit transfer instrument may 3 be used by more than one member of a family or household, the 4 card or other instrument is required to bear the name of each 5 user. 6 A welfare fraud task force is created to review the state 7 laws, policies, procedures, and processes applied to prevent 8 and address fraud and abuse in public welfare programs 9 for persons with low income and make recommendations for 10 improvements. Staffing for the task force is to be provided 11 by the department of inspections and appeals. The task force 12 is required to report to the governor and general assembly in 13 December 2013. The task force membership includes members of 14 the general assembly. 15 -5- LSB 2201YH (9) 85 jp/nh 5/ 5