The Wisconsin Department of Health Services has agreed to pay the federal government $6.9 million to resolve allegations it violated the False Claims Act, according to the Department of Justice.
WDHS violated the False Claims Act in its administration of the Supplemental Nutrition Assistance Program. SNAP provides financial assistance to low-income individuals and families to purchase nutritious food. Although the federal government funds the program, states determine whether program applicants are eligible for benefits, administer benefits and perform quality control to ensure eligibility decisions are accurate. States are required to report their error rates in making eligibility decisions to the federal government.
WDHS hired Julie Osnes Consulting in 2008 to review the error cases its quality control workers identified. WDHS admitted that it implemented several biased quality control practices based on the advice of Julie Osnes Consulting that improperly decreased its reported error rate, according to the DOJ.
The U.S. Department of Agriculture pays performance bonuses annually to states that report the lowest and the most improved error rates. Due to its improper quality control practices, WDHS earned performance bonuses it was not entitled to from 2009 through 2011.
"While I am deeply troubled that these actions happened within a state agency entrusted with assisting vulnerable and needy Wisconsin residents, I am heartened that WDHS has cleaned up its act and that it cooperated with our investigation," said Acting U.S. Attorney Jeffrey M. Anderson for the Western District of Wisconsin.
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