KFMAM Manual - 11/22/2009

07000

08000: Incorrect Payments - Prevention of incorrect benefits is the responsibility of every SRS staff member, contracted staff member, and client. Incorrect benefits include both underpayments and overpayments for clients.

08100 Underpayments -

8110 Underpayments - An underpayment is the amount of assistance that a client did not receive but was entitled to.

Staff shall, at a minimum, document how the underpayment was calculated and the reason benefits must be restored.

8111 Situations Requiring Restoration of Benefits - Underpayments shall be corrected promptly using the program policies in effect for the month(s) in which the underpayment of benefits was made.

The following are the various situations in which a household may be entitled to restoration of benefits:

8111.01 - Benefits are lost due to Agency error;

8111.02 - Agency failed to give the household sufficient time to verify a deduction and, as a result, its benefits were lowered (see KEESM 1322.3(3));

8111.03 - Agency fails to take action within time frames on reported changes that increase the household's benefits (see 7212);

8111.04 - Fair hearing decision in favor of the household;

8111.05 - Administrative Disqualification Hearing decision reversed by court (see 8520);

8111.06 - Lost benefits ordered as a result of a class action or other suits (Example: USDA court orders)

8112 Medical Assistance Underpayments - Medical assistance underpayments are to be promptly corrected subject to the limitation that the provider must bill the agency for the expenses within the mandatory 12 month limitation period. In instances where eligibility was incorrectly denied, and it is documented that the provider will not return payment to the client, the client shall be reimbursed for the verified amounts paid to the provider, up to the proper rate for the service. There is no other provision for correcting of medical underpayments.

8113 Situations Not Requiring Restoration of Benefits - The following situations are handled as reported changes and the household is not entitled to restoration of benefits:

8113.01 - Verification of eligible alien status provided and member added (see 2047.03);

8113.02 - The household failed to report a change which would have resulted in an increase in benefits had the change been timely reported. Refer to 7212.

8113.03 - The household failed to timely provide necessary information. See 7212.

08200 Time Frames and Limits -

8210 Time Frames and Limits - Once it has been determined that an underpayment is due a household, these benefits shall be calculated and issued (unless offsetting of the full amount will occur) to the household as soon as possible but no later than 20 calendar days after the Case Manager becomes aware that an underpayment is due.

8211 Erroneous Denial - If an eligible household's application was erroneously denied, the month the loss initially occurred shall be the month of application or, for an eligible household filing a timely review, the month following the expiration of its review period.

8212 Erroneous Termination - If a household's benefits were erroneously terminated, the month the loss initially occurred shall be the first month benefits were not received as a result of the erroneous termination action.

08300 Overpayments and Claims - An overpayment is assistance that is over the amount to which the client is entitled. If a cash assistance overpayment results in ineligibility, a determination of medical eligibility shall be made beginning with the month of ineligibility for cash. Any resulting medical overpayment shall be calculated.

One or several months of overpayment become a claim when the cause of the overpayment(s) are due to the same or related causes. See 8310. A claim shall be established against any household that has received more assistance than it is entitled to receive.

08310 Establishing Types of Claims -

8311 Criteria For Establishing Types of Claims - Claims are classified according to the error cause as follows:

8312 Agency Error - Instances of agency error which may result in a claim include, but are not limited to, the following:

8312.01 - Prompt action was not taken on a change reported by the household;

8312.02 - The household's income or deductions were incorrectly computed or the household was otherwise assigned an incorrect allotment;

8312.03 - Benefits continued to be provided to a household after its review period had expired without benefit of a reapplication determination; or

8312.04 - Misapplication of policy.

8313 Client Error - Instances of client error which may result in a claim include, but are not limited to, the following:

8313.01 - Nonwillful withholding of information from a one-time failure on the part of a client to report a change timely (see 7111), which affects eligibility and/or the amount of assistance when:

(1) - The Case Manager has reason to believe that the client did not understand his responsibility; and

(2) - There was no oral or written misstatement by the client, or

8313.02 - Willful withholding of information such as:

(1) - Misstatement (oral or written) made by the client in response to oral or written questions from the agency;

(2) - Failure by the client to report a change timely (see 7211), which affects eligibility and/or amount of assistance;

(3) - Failure by the client to report the receipt of a payment which he knows, or should know, represents an incorrect benefit;

8314 Fraud Error - A fraud error is a willful client error which has been found to be fraud in accordance with the provisions in 8400. An individual shall be considered to have committed fraud:

(1) - For medical assistance, when the individual has been legally determined to have committed fraud through a court of appropriate jurisdiction.

Fraud error status is not established if a court's resolution to a willful error situation is to place the person on diversion unless the person has signed a disqualification consent agreement.

08320 Instances not Requiring a Claim -

8321 Instances Not Requiring a Client or Agency Claim - A claim shall not be established if an overpayment occurred as a result of the agency failing to insure that the household fulfilled the following procedural requirements:

8321.01 - Signed the application;

Other instances when a claim should not be established include:

8321.02 - Assistance granted in accordance with the treatment of income policies or the inability to act on available information due solely to issuance cutoff dates and/or timely notice requirements do not constitute an incorrect payment.

8321.03 - Eligibility errors related to citizenship or alien status will not cause incorrect payments in the following situations:

(1) - eligibility was based on verification of satisfactory immigration status by the Immigration and Naturalization Service (USCIS);

(2) - eligibility was approved to meet timely processing guidelines, but no USCIS response to a request for verification of immigration status has been received; or

(3) - eligibility was approved to meet timely processing guidelines, but the reasonable opportunity period allowed for alien applicants to provide documentation of their alien status had not expired. "Reasonable opportunity" shall be defined as 10 calendar days from the date of request.

8321.04 - Overpayments that occur as a result of the household not reporting a change in household circumstances that they were not required to report. See 7211.

08330 Time Frames and Limits for Establishing Claims -

8331 - For agency and client overpayments, the agency is required to prepare the claim and initiate recovery or attempt to initiate recovery by the end of the calendar quarter following the calendar quarter in which the overpayment is first identified.

8332 - For fraud overpayments, the agency is required to prepare the claim and initiate a referral to either the Fraud Unit or the Administrative Disqualification Hearing Officer by the end of the calendar quarter following the calendar quarter in which the overpayment is first identified.

08340 Computing the Overpayment -

8341 Computing the Overpayment - In calculating the amount of an incorrect benefit, the agency shall determine the point at which the correct information should have been reported and acted upon timely allowing for timely notice as appropriate. From that point the correct benefit for subsequent months shall be determined comparing the amount with the actual benefit issued.

For households who fail to report a change, the first month of overpayment shall be determined by allowing for the 10-day period to timely report changes and the 10-day period for Notice of Adverse Action.

EXAMPLE: If a notice of adverse action was required but was not sent, it should be assumed that the 10-day advance notice period would have expired without the household requesting a fair hearing. If a change was not reported, the claim shall be based on the first issuance that would have been affected had the household reported the change.

The Case Manager shall calculate the amount of overpayment using all nonexempt income the household actually received in the income month for the month of overpayment and considering expenses and deductions that were reported or were required to be reported, and should have been allowed at the time the original benefit for the month was determined. For persons with prospectively budgeted or averaged income the overpayment shall be determined using actual income received in the calendar month of the benefit. This includes using actual amounts for situations in which a conversion method (i.e., 4.3 times weekly amount) would have been used in nonmonthly reporting situations.

The following special provisions apply when computing an overpayment:

8341.01 Medical Assistance Provisions - For medical program purposes, when a recipient fails to meet an increased spenddown resulting from an increased income or other changes of circumstances within an eligibility base period, medical payments previously made within the base period shall not be considered overpayments unless it is determined that the client willfully withheld information. In the case of willful withholding of information, overpayments shall be computed from the date the case should have been adjusted had the information been timely reported. The amount of the overpayment shall be computed based on payment information from HCPMP. For alleged fraud situations referred to the Fraud Unit, that unit is responsible for obtaining the necessary information and forwarding it to the Case Manager.

For other overpayment situations, information on claims can be obtained through the MMIS system. See the SRS MMIS User Reference for Field Staff Manual.

08350 Establishing Claims and Repayment Agreements -

8351 Establishing Claims and Repayment Agreements - Once the Case Manager has determined the amount of overpayment, a claim shall be entered on the OVCA screen in KAECSES. The claim shall be designated as either a client, agency, or fraud claim. Suspected fraud claims shall be initially established as client claims. If a determination of fraud is made, the claim type shall then be changed from client to fraud.

Collection action for client or agency claims with no restored benefits due shall be initiated by sending the household a repayment agreement.

NOTE: Collection action should not be initiated on suspected fraud claims (either referred for prosecution or for an administrative disqualification hearing) until after the determination of fraud has been made. Refer to 8500 for initiating collection action on fraud claims.

After a claim determination has been made, the local office shall send a repayment agreement and proceed as follows:

8351.01 - Give the household 10 days to respond to the repayment agreement. The reason the claim occurred must be explained on the letter.

8351.02 - If the household responds with a payment on the claim, have the payment submitted according to established procedures.

8351.03 - If the household does not respond, or responds with a statement that it is unable to pay, promises to pay, or asks for a fair hearing, proceed as follows:

(1) - If the household responds by saying it cannot repay, the Case Manager shall consider any information known to the agency, in addition to the household's statement, documenting this information in the case file.

(2) - If there is ineligibility for continued assistance and the case is closed, the agency is still required to attempt recovery. At a minimum, the agency is required to initiate action to locate the former recipient and, if located, initiate some form of action to recover the overpayment. Such activities must be documented in the case record. To meet these requirements the agency must send a letter to the client at the last known address that advises the client to contact the Case Manager to work out a repayment plan. If the letter is returned, the case record shall be documented as to why it was not delivered. No further action is required when the person cannot be located. However, should the client reapply or the agency later learns the whereabouts of the client, recovery efforts must be reinstituted.

(3) - All repayment plans shall allow for complete repayment within 12 consecutive months, when possible. If total repayment is not possible within 12 months because of limited available resources, the plan will provide for complete recovery as soon as possible.

08360 Collecting Claims -

8361 Collecting Claims - The following special procedures apply when initiating collection action on claims.

8362 Methods of Collecting Payments - Claims shall be collected in one of the following ways:

8362.01 Lump Sum - (1) - Payments shall be collected from households in one lump sum cash payment if the household is financially able. However, the household shall not be required to liquidate all of its resources to make this one lump sum payment.

(2) - If the household is financially unable to pay the entire amount of the claim at one time and prefers to make a lump sum cash payment as partial payment of the claim, it shall be accepted.

8362.02 Installments - If the household is not currently participating in the program with the overpayment and has insufficient liquid resources or is otherwise financially unable to pay the claim in one lump sum, a payment schedule shall be negotiated. Once negotiated, the amount to be repaid each month through installment payments shall remain unchanged. Both the household and the agency shall have the option to initiate renegotiation of the payment schedule if they believe that the household's economic circumstances have changed enough to warrant such an action.

If the household requests renegotiation, but the Case Manager feels that the household's economic circumstances have not changed enough to warrant the requested settlement (such as the fact that the household's source of income has not changed) then the Case Manager may continue renegotiation until a settlement can be reached.

8362.03 Provisions Specific to Medical - For medical cases not subject to the fraud provisions of 8400 or to other legal recovery efforts, an overpayment may be recovered only if there are nonexempt resources that are currently available. This includes any resources counted toward the allowable resource level of 4010.

If the overpayment is a result of an understated spenddown, the total amount of the overpayment cannot exceed the understated amount. If the overpayment is a result of excess resources, the total amount of the overpayment shall be the amount of claims paid (or subject to be paid) for the ineligible period not to exceed the amount by which the total nonexempt resources exceed the allowable resource level. (See 4010.) If the value of the total nonexempt resources vary during the ineligible period, the highest value obtained for that period shall be used. If ineligibility exists for a reason other than excess resources, the total amount of the overpayment shall be equal to the amount of claims paid (or subject to be paid) for the ineligible period.

When the amount of the overpayment has been determined and there are resources to recover from, the client may voluntarily choose to make a repayment to the agency. If the client does not choose to make a lump sum repayment, a special spenddown shall be created in an amount equal to the amount to be recovered and shall be considered in the current eligibility base period.

Medical expenses may be counted against the special spenddown requirements if the expense is:

(1) - verified,

(2) - for a medically necessary (see Medical Services Manual) service, and

(3) - reported to the agency on at least a 6 month basis.

Medical expenses shall first be counted against regular spenddown requirements and then the special spenddown requirements.

The special spenddown mechanism may be used to recover medical program overpayments for both automatic and determined eligibles. There is no necessity that a client have a regular spenddown. However, special spenddown shall not be used in the Medicaid poverty level or HealthWave programs. If a special spenddown mechanism is used on regular spenddown cases, it is necessary for the client to report all medical expenses incurred until both spenddowns have been met. They may extend over more than one base period. If the client fails to provide the agency with this information and he reapplies at a later date, the special spenddown shall be considered to be unmet.

8363 Special Criteria for Initiating Collection Action on Fraud Claims - If a household member is found to have committed fraud (by any of the means described in 8400), collection action shall be initiated against the individual's household. In addition, a personal contact shall be made with the household, if possible. Such collection action shall be initiated unless the household has already repaid the overissuance. See 8500.

8364 Claims Discharged through Bankruptcy - Central Office shall act on behalf of FNS in any bankruptcy proceedings against bankrupt households owing food stamp claims. Therefore, if the local agency has knowledge of bankrupt proceedings against any household owing a claim, Central Office shall be notified immediately and the local agency shall cease collection activity pending the outcome of the court proceedings. Collection action should be resumed (or initiated) after and in conformance with the final court action.

NOTE: To cease collection activity pending the outcome of bankruptcy proceedings. Cash claims cannot be terminated, so to cease collection, the repayment plan code must be removed. Claims must not be deleted. Once final court action is known, the discharged amount shall be compromised. This is done by notifying Central Cashier to enter the discharged amount with the Compromise method of recovery (CO).

08370 Transferring Claims -

8371 Transferring Claims - In certain situations, an active claim may exist on a closed case and the client that was responsible for the claim is receiving cash or food stamp benefits on another case. If the recovery method is to be by benefit reduction or offsetting, the claim must be transferred from the closed case to the active case. (Only cash benefits can be recovered from a cash case and food stamps from a food stamp case.) If recovery is by any other method, the claim need not be transferred.

8371.01 - To transfer a claim (with or without payments already credited), the following procedures are to be followed:

(1) - NO Payments Have Been Made on the claim:

(a) On the closed case with the active claim, screen print OVCA to determine and document the amount of the claim. THIS IS VERY IMPORTANT, because once the claim is deleted, the amount of the claims will NOT be accessible.

(b) Once the amount of the claim is documented by the screen print of OVCA, use the delete (DL) function and delete the claim from the closed case. This will automatically close the claim and set the balance to zero.

(2) - Payments Have Been Made on the claim:

(a) On the closed case with the active claim, screen print OVCA to determine and document the balance remaining on the claim. THIS IS VERY IMPORTANT, because once the claim is modified, the balance remaining will not be accessible.

(b) Once the amount of the remaining balance is documented by the screen print of OVCA, use the change action function and modify the claim (each month, as needed) such that the remaining balance is equal to the amount of payments that have been made on the claim. Once processed, this will set the claim balance to zero.

Example: A claim was established in 1998 for $135.00, for the months of January 1998 through May 1998. The breakdown for each month is as follows: January - $25, February - $30, March - $30, April - $20, May - $30. Benefit reduction in 1999 collected $50 and the balance of the claim is now $85. The claim amount must be reduced to $50 in order for the claim to show a balance of zero. To do this, the change (C) function must be used to modify the claim for January to 0, February to 0, and March to 0. April will be left at $20 and May at $30 equaling $50. Since $50 was paid on the claim, it will zero out the claim balance once this change is processed. The remaining balance of $85 will be established on the new case. Any problems with this procedure should be referred to Help Desk.

8371.02 - Document why the claim is being transferred, and the name and case number of the case it is being transferred to.

8371.03 - On the case where the individual responsible for the claim is active, establish a claim with the remaining balance, documenting where the claim was transferred from, the original date the claim was established, and any other pertinent information.

8371.04 - Start benefit reduction, or complete offsetting as appropriate. Notify the PI of the recoupment (or offsetting) and explain why the reduction is occurring.

08380 Compromising Claims -

8381 Compromising Claims - The compromise method of payment shall be used in the following situations:

8381.01 - When a claim has been discharged in a bankruptcy. The amount discharged shall be entered as the amount compromised.

8381.02 - When the amount of the claim is reduced in accordance with a court or Fraud Unit agreement. The amount determined uncollectible shall be entered as the amount comprised.

All actions to compromise the balance of a claim are done by Central Cashier following established practices for submitting payments. The compromise method can be used on all programs, and must be pre-authorized by Fraud Unit staff and/or the Central Office TOP Unit.

08400 Determination of Fraud - Any individual who is suspected of committing fraud for the purpose of improperly establishing or maintaining eligibility for medical assistance benefits shall be referred to the Fraud Unit or Administrative Disqualification Hearings Officer as appropriate for a determination of fraud.

An individual may be found guilty of fraud by any one of the following methods:

For medical assistance, when the individual has been legally determined to have committed fraud through a court of appropriate jurisdiction.

A referral may be made to the Administrative Disqualification Hearing Officer (ADHO) or to the local Fraud Unit regardless of the current eligibility of the individual.

08410 Definition of Fraud - Fraud is defined as having intentionally made a false or misleading statement, misrepresentation, concealment, or withholding of facts for the purpose of improperly establishing or maintaining eligibility.

08420 Medical Assistance Penalties - An individual who has been convicted of medical assistance fraud under 42 U.S.C. Sec. 1320a-7b shall be ineligible for medical assistance for one year from the date of conviction. Convictions under state law do not carry a disqualification period.

If a court fails to impose a disqualification period for any fraud violation, the state agency shall impose the appropriate disqualification penalty specified above unless it is contrary to the court order.

Only the individual, and not the entire household, found to have committed fraud, or who signed the waiver to an administrative hearing or a disqualification consent agreement in cases referred for prosecution, shall be disqualified.

Persons rendered ineligible under the above provisions shall be treated as sanctioned individuals for mandatory filing unit purposes in accordance with KEESM 4113(2) for the cash program. Ineligible cash individuals may receive medical under a determined category if requirements are met. Pregnant women who are sanctioned remain eligible for medical coverage when continuous eligibility provisions apply. See 2300, and 2222.

08430 Determining the Proper Type of Referral - Before a referral for prosecution for suspected fraud can be made, it is necessary for the agency to first determine the amount of alleged fraudulent overpayment by following the procedures outlined in 8340. The same act of alleged fraud repeated over a period of time shall not be separated so that separate penalties can be imposed. Once this has been accomplished, the amount of the total alleged overpayment determines the type of referral which shall be made. If it is decided that a case will not be referred for prosecution, or the local Fraud Unit has declined prosecution and not recommended a referral to the Administrative Disqualification Hearing Officer, then the overpayment shall be handled as a client overpayment as outlined in 8313. The burden of proving fraud is on the agency. All referrals shall be reviewed by the Case Manager Supervisor prior to the referral being sent to either the local Fraud Unit or the Office of Administrative Hearings.

There is a $101 minimum amount of alleged fraudulent overpayment required to initiate a fraud determination action. Claims of $100 or less shall not be considered or pursued as fraud but instead should be treated as client errors and collected in accordance with provisions in 8313 and 8350. However, for attempted (alleged) fraud situations in which no benefits were provided, the $101 minimum does not apply and a fraud determination must be pursued.

Cases suspected of provider fraud are to be referred by memo to the Fraud Unit. This memo is to include all pertinent information currently available concerning the alleged fraud.

08440 Fraud Unit Referrals - A case shall be referred to the Fraud Unit when the total amount of alleged fraudulent overpayment is in excess of $1,000.

A threshold amount exceeding $1,000 may be utilized for this purpose if approved by the Office of Administrative Hearings and the EES Program Administrator after consultation with the local Fraud Investigator. The local Fraud Unit will make a decision as to whether or not to pursue prosecution through either civil or criminal action. Once a case is referred to the Fraud Unit, the local agency shall follow whatever instructions the Fraud Unit staff give in regard to prosecution. If the Fraud Unit decides not to prosecute the case, the FRS-1 will be returned to the local agency with instructions either to refer the case to the Administrative Disqualification Hearing Officer or not pursue the case for a determination of fraud, in which case the overissuance should be handled as a client overissuance. When the case has been accepted for prosecution there shall be no further referral to the Administrative Disqualification Hearing Officer by the local Case Manager.

If an alleged fraudulent overissuance is accepted for prosecution and the client enters into a diversion agreement, a finding of fraud is not made. As a result, the individual cannot be disqualified, nor can the amount of the overissuance be coded as fraud on the KAECSES system. These claims must be coded as client errors. In addition, the alleged fraudulent overissuance can not be referred for an administrative disqualification hearing for the purpose of a finding of fraud. For these reasons, it is suggested that a disqualification consent agreement be obtained when individuals enter into diversion agreements. Only when a disqualification consent agreement has been signed can the claim be coded as fraud and the individual disqualified from the program.

Whenever possible, persons referred to the Fraud Unit should not receive notification that the case is under investigation prior to a determination by the Fraud Unit regarding the action to be taken. When responding to client inquiries concerning suspected fraud overpayments, EES staff should simply advise the client that the medical case is "under administrative review." Any involvement by the Fraud Unit should not be mentioned to the client.

08460 Fraud Unit Referral - Making the Referral, Fraud Unit Referrals made to the Fraud Unit shall be made by use of the form FRS-1.

NOTE: Alleged Fraud in Medical Assistance - All instances of alleged client fraud in medical assistance shall be referred to the Fraud Unit via form FRS-1. All procedures in 8440 for cash assistance Fraud Unit referrals are applicable except there is no financial threshold determination, referral for an Administrative Disqualification Hearing is not applicable, and signing a disqualification consent agreement is not appropriate.

08480 Imposition of Disqualification Penalties -

8481 Cases Referred to Local Fraud Unit -

8481.01 - Individuals found guilty of civil fraud or criminal fraud by a court of appropriate jurisdiction shall be disqualified for the length of time specified by the court. If the court fails to impose a disqualification period, a disqualification period shall be imposed in accordance with KEESM 11221, unless contrary to the court order. If a disqualification is ordered, but a date for initiating the disqualification period is not specified, the disqualification period for currently eligible individuals shall be initiated within 45 days of the date the disqualification was ordered. The disqualification period is initiated by the sending of the notice. The notice must be sent within 45 days, with the disqualification starting the month following the month in which the notice is sent (or should have been sent in cases where the agency does not act timely to disqualify the individual). Any other court-imposed disqualification (including those which are a result of signing a disqualification consent agreement in cases that enter diversion or those in which the court fails to specifically impose a disqualification period) shall be initiated within 45 days of the date the court found the individual guilty of civil or criminal misrepresentation or fraud. For fraudulent individuals not currently eligible, disqualification periods shall be initiated by notifying the household of the fraud and the specific time period established for disqualification. The disqualification period for individuals not currently eligible shall also be established within 45 days of the date the disqualification was ordered, or within 45 days of the date the court found the individual guilty of civil or criminal fraud as described above. The Case Manager is responsible for notifying the fraudulent individual of the disqualification period and the effect on the remaining household members, if any.

8481.02 - Once a disqualification period has been imposed against the fraudulent individual, the period of disqualification shall be initiated and shall continue uninterrupted until completed regardless of the eligibility of the fraudulent individual's household. The fraudulent individual's household shall continue to be responsible for repayment of the fraudulent overissuance regardless of its eligibility for program benefits.

8481.03 - If the agency fails to act timely to disqualify the fraudulent individual, the individual can only be disqualified to the extent that the disqualification period has not elapsed. An agency error claim SHALL NOT be established for any overissuance resulting from the fraudulent individual participating in the program when he/she should have been disqualified.

08500 Fraud Overpayment Recovery -

8510 Fraud Overpayment Recovery - The remaining household members, if any, shall begin repayment during the period of disqualification imposed by the court or the ADHO. The repayment agreement shall inform the remaining household members of:

8510.01 - The amount owed;

8510.02 - The period of time the overpayment covers;

8510.03 - The repayment methods that are available; and

8511 - The household shall have 10 days from the date the notice is mailed to return the completed repayment agreement. If the household fails to return the completed repayment agreement in the time allotted, benefit reduction shall be imposed in accordance with KEESM 11126.1(4), if repayment is not otherwise established by a court or with the Fraud Unit. In addition, if the household agrees to make repayment but fails to do so, benefit reduction shall be automatically imposed. All actions to invoke benefit reduction when a household has not been making agreed upon repayments must be coordinated with local Fraud Unit Staff. If benefit reduction is invoked, adequate notice only is required.

All repayments shall be made in accordance with established procedures in KEESM 11126.1(4) for cash repayment, monthly installments or benefit reduction.

08520 Reversed Disqualifications - In cases where the determination of fraud is reversed by a court of appropriate jurisdiction, the individual shall be reinstated if otherwise eligible. An underpayment shall promptly be made for any assistance which was lost as a result of the disqualification.