By: Meza (Senate Sponsor - Johnson) H.C.R. No. 54
         (In the Senate - Received from the House May 17, 2021;
  May 17, 2021, read first time and referred to Committee on Health &
  Human Services; May 21, 2021, reported favorably by the following
  vote:  Yeas 9, Nays 0; May 21, 2021, sent to printer.)
Click here to see the committee vote
  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;
         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.
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