H.C.R. No. 54
HOUSE CONCURRENT RESOLUTION
WHEREAS, In 2015, the federal Department of Justice (DOJ)
began an investigation of the Health and Human Services Commission
(HHSC) quality control (QC) of the Supplemental Nutrition
Assistance Program (SNAP) from 2007 to the present, requesting
documents from HHSC in April 2017 and deposing HHSC staff in March
2019; and
WHEREAS, DOJ's investigation focused on whether HHSC
properly and accurately calculated, determined, and reported
Texas' error rates in compliance with FNS requirements regarding
SNAP QC; specifically, DOJ focused on HHSC's relationship with
Julie Osnes Consulting (Osnes), a contractor who assisted HHSC in
determining SNAP error rates and quality control review of SNAP
cases from September 2009 to June 2015; and
WHEREAS, DOJ was concerned that, by following certain
recommendations by Osnes, HHSC failed to maintain the integrity of
the QC system by introducing bias into its processes; and
WHEREAS, Osnes reached a settlement with DOJ in June 2019 of
$751,571, and to date three other states have settled DOJ's claims
related to their implementation of Osnes's recommendations:
(a) April 2017--Virginia settled for $7,150,436;
(b) April 2017--Wisconsin settled for $6,991,905;
(c) September 2017--Alaska settled for $2,489,999; and
WHEREAS, DOJ claimed that HHSC's SNAP management violated the
Federal False Claims Act (31 U.S.C. 3729, et seq.) and the Program
Fraud Civil Remedies Act (31 U.S.C. 3801, et seq.), in addition to
asserting various claims under common law; and
WHEREAS, The Covered Conduct alleged by DOJ included:
(a) Changing QC findings or dropping cases from review to
reduce or eliminate errors;
(b) Adding to or removing information from case files as
necessary to support the new findings and submitting the revised
findings and information to the U.S. Food and Nutrition Service;
(c) Finding ways to induce client responses to justify
dropping error cases from the review and asking leading questions
of clients to obtain desired answers to eliminate error potential;
(d) Selectively applying requirements and policies to
overturn and reduce errors;
(e) Retaliating against SNAP employees who questioned using
Osnes's methods by removing the employees from the QC review team;
and
WHEREAS, DOJ sought recovery of two years of accuracy
performance bonuses paid to HHSC, as well as certain other costs
associated with the QC process and the relationship with Osnes; and
WHEREAS, DOJ engaged HHSC in settlement negotiations, with
the Office of the Attorney General representing HHSC in both the
investigation and settlement discussions; and
WHEREAS, In December 2019, the parties reached agreement on
the following terms:
(a) A total settlement amount of $15,294,360:
(1) Of that amount, DOJ characterizes $13,396,343 as
restitution for the performance bonuses paid to the State;
(2) The remaining $1,898,017 represents repayment of
the federally funded portion of HHSC's QC costs and the amounts paid
to Osnes, plus a "multiplier" required by DOJ;
(b) Waiver by HHSC of any claim to the 2014 performance
bonus that was awarded but never paid to the State;
(c) No admission of liability by HHSC; and
WHEREAS, Section 111.003(b) of the Texas Civil Practice and
Remedies Code prohibits HHSC from entering a settlement agreement
that requires the payment of damages of more than $10,000,000
within a fiscal biennium; therefore, the settlement agreement is
expressly conditioned upon the legislature approving and
appropriating the agreed upon settlement amount; and
WHEREAS, Since the findings resulting in the settlement, the
U.S. Department of Agriculture has reviewed HHSC's Quality Control
SNAP section processes twice and did not identify any adverse
finding; now, therefore, be it
RESOLVED, That the 87th Legislature of the State of Texas
hereby approve the proposed Settlement Agreement.
Meza
______________________________ ______________________________
President of the Senate Speaker of the House
I certify that H.C.R. No. 54 was adopted by the House on May
14, 2021, by the following vote: Yeas 110, Nays 16, 1 present, not
voting.
______________________________
Chief Clerk of the House
I certify that H.C.R. No. 54 was adopted by the Senate on May
27, 2021, by the following vote: Yeas 30, Nays 1.
______________________________
Secretary of the Senate
APPROVED: __________________
Date
__________________
Governor