Financial Institution Data Match or FIDM

Compilation of Responses to Email Inquiry

April 2008

This inquiry was sent to select pool and partner members.

AGRiP has received a request for information on the Financial

Institution Data Match (FIDM) program.

We understand FIDM to be a federal mandate, stemming from

Federal legislation passed in 1996 and adopted statutorily by various

states, to obtain financial information of child support obligors that

may be in the possession of “financial institutions”. Financial institutions

are understood as “banks…insurance companies….or similar institutions.” (emphasis added) The procedure for providing the financial information requested involves matching lists of person who have an “account” held by the “financial institution” with data from the child support enforcement agency indicating delinquent obligors.

A member pool has asked us to try to compile information/opinions on the applicability of FIDM to public entity risk and benefit pools. We are unaware

of pools who are currently participating in FIDM.

Identifying information was redacted from responses.

Response 1

We are not participating

Response 2

This is a program that Our Pool does not deal with. We have never had inquiry from the FIDM program and have had no involvement with it to date.

Response 3

We do not participate with the FIDM. This is the first we have heard of this entity.

Response 4

Our Pool does not participate in the FIDM program. In our opinion, Our Pool is not a "financial institution" as defined. We would appreciate your opinion, after gathering responses from other governmental risk pools, whether the federal mandate applies to claim or litigation settlements.

Response 5

Our Pool is more familiar to the federal law - Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) of 1996. It requires every state to operate a child support enforcement program. Under PRWORA, employers must report each new hire to a state “directory of new hires” within 20 days of hiring. We must submit the employee’s W-4 form or equivalent documentation. The state agency in turn must report this information to a national directory of new hires at the U.S. Department of Health and Human Services. In Our STATE, we send our info to SSD Data Control in Our STATE Capital.

I am uncertain how this interacts with the FIDM program. Maybe PRWORA is at the state level, and the FIDM is at the federal level?

Response 6

It is Our Pool's position that in pools are not subject to this Statute. Attached is Ohio requirements that show "Financial Institutions" must comply. Under the definitions, pools are not considered to be a "Financial Institution".
From the Ohio Revised Code:

CHAPTER 3121: COLLECTION AND DISBURSEMENT OF CHILD SUPPORT

3121.74 Account information access agreements - financial data matching program.

The office of child support in the department of job and family services shall enter into account information access agreements with financial institutions doing business in this state and with financial institutions doing business in other states. The office may join an alliance of states for the purpose of participating in the financial data matching program, as defined in section 666(A)(17) of Title 42 of the United States Code, and entering into agreements with financial institutions doing business in this state…

3121.01 Collection and disbursement of child support definitions.

As used in this chapter:

(C) “Financial institution” means a bank, savings and loan association, or credit union, or a regulated investment company or mutual fund.

Response 7

In Our STATE the state Workers Compensation Boardand the state Department of Health and Human Services share data. If it is ascertained through this data sharing process that a recipient of WC wage benefits owes child support, then DHHS will assert a lien and garnish a portion of the WC wage benefits. Because data we provide the WCB is shared with DHHS by the WCB, we have no direct communication with DHHS unless and until DHHS asserts a lien.

With respect to Our Pool, this is a publicly fundedrisk pool created by statute which also states "any publicly self-funded pool operating under this chapter is not an insurance company...." and "...does not constitute doing an insurance business."

Neither of our programs is participating in FIDM, nor has DHHS approached us regarding matching data transfer.

Response 8

For Workers’ Compensation claims our state Compensation Board shares its data of claimants who receive benefits with Child Support. The County agencies in charge of child support than advise us to pay a portion of the benefits to the agency to distribute to dependent children. We do not report claims information to FIDM although we do report to the Index Bureau and the Workers’ Compensation Board

Response 9

In 1996, Congress passed the well known Welfare Reform act. The act includes child support provisions that require state legislatures to pass certain welfare reforms in order to retain child support funding. As a result, strong child support enforcement tools, including income withholding, mandatory use of interstate subpoenas and liens, and the matching of databases to locate parents and discover information on their income and assets, were provided in the Act.

Since 1998, Rhode Island was the first state to enact a law requiring the report of casualty claims to the state's Child support Enforcement Agency before paying insurance claims, and to make sure that the claimant was not a delinquent child-support obligor. Since 1998, the program has expended and every year more and more states are entering the program. As of the beginning of 2008, 27 states have joined the Child Support Lien Network, and their data is provided to the Child Support Enforcement agency of the participating states. The following is a list of participating states:

AlabamaMaine Texas

ArizonaMissouri Vermont

ArkansasNew HampshireVirginia

CaliforniaNew Jersey Washington

ConnecticutNew Mexico West Virginia

DelawareNorth Dakota

FloridaOklahoma

GeorgiaPennsylvania

IllinoisRhode Island

IndianaSouth Dakota

IowaTennessee

Please note that the states of Rhode Island, New Jersey, Pennsylvania and Oklahoma, have mandatory requirements for checking the child support payment status of claimants. In other states. insurers, TPA's and other claim processors may voluntarily check the status.

More and more states are becoming part of this program, and there is indication that the trend will be to make it a mandatory process for all states.

We started to submit claims through ISO ClaimSearch and as of 11/1/2007, all of our files are checked against the data base of all states in the program.

If a claim matches any of the records of delinquent obligors, Child support Lien Network will notify the appropriate state child support enforcement agency. The agency may, at its discretion, place a lien on any potential settlement, but notification will be provided.

Respondent pays an annual fee for participation in the ISO ClaimSearch Program, and there are no fees to Respondent or the client for participation in the Child Support Lien Network.

We receive notice on a weekly basis from the Child Support Lien Network (CSLN) requesting information on our claims (handling office address, phone, fax and handling adjuster, claim status and type of claim). Copies are kept on every request that is returned to CSLN.

I am not sure on the applicability of this Act on Public Entity Risk & Benefit Pools. Nevertheless, it would appear that there is applicability to any entity responsible for issuing financial payments to a claimant as a result of a claim. Further, considering that there is no cost involved, and that the trend is to make it mandatory by all states, the best solution is to comply with it now.