About CSLN

The Child Support Lien Network (CSLN) was initially conceived and hosted by the State of Rhode Island, first as a solution for their state’s specific insurance claim intercept law, and subsequently expanded to encompass other states and their administrative powers. We ask insurance companies to join forces with the Child Support Lien Network as we attempt to collect past due child support from delinquent obligor parents without the need for any further cumbersome laws or mandates.

CSLN has expanded from a small group of New England states to a nationwide network. Currently the network has 14 states as members: Rhode Island, Connecticut, Maine, Vermont, Arkansas, New Jersey, Florida, Texas, Tennessee, Nevada, California, Illinois, Virginia and Iowa. Several additional states are poised to become members in the upcoming year.

Here is how the CSLN system works. States pool their delinquent child support obligor information in the CSLN network, which is electronically matched daily with the claims, filed with insurance companies across the country. Upon a claim matching to a delinquent obligor, the insurer passes on to CSLN the claim information and company contacts. CSLN alerts the member state with this information and the state follows up immediately with the insurance company to file the appropriate administrative notice of lien or income withholding order against the future settlement.

The CSLN process of using a single database of millions of delinquent child support obligors to interface daily with the insurance industry files has been shown to work so much more effectively than individual states making individual requests for this information from an insurance company’s various offices. The electronic interface is successful for both states and insurers primarily because it is automatic and so much less intrusive upon staff and operations. The CSLN system works because it was designed, developed and implemented by claims examiners and adjusters from major insurers and by representatives from the insurance trade associations working in partnership with state officials.

When CSLN asked the insurance industry for help in designing the Child Support Lien Network the industry responded very favorably. Getting access specifically to insurance company’s claimant information is now needed for us to improve our collections for deserving children. Our estimates reflect that more than $2 Billion in claim settlement payments made each year for personal injury and workers’ compensation claims could be deferred to the claimant’s children who are owed past due child support. Assistance from the insurance industry is necessary to make this a reality for many of our nation’s 20 million children who are not receiving all of their ordered child support payments.

In the past decade, the US Congress provided state child support officials with a battery of legal and administrative tools that allow us to take extraordinary measures to collect a burgeoning past due child support debt for America’s children. Several of the measures enacted gave child support agencies the powers to:

• Obtain information through administrative subpoena
  
• To suspend professional, occupational and drivers licenses
  
• To suspend hunting and fishing licenses
  
• To suspend motor vehicle registrations
  
• To intercept bank accounts and stock funds with administrative liens and levies
  
• To intercept both federal and state tax refunds, as well as lottery prizes
  
• To implement immediate income withholding orders for support payments from wages paid by employers.
  
• To require all employers to report every employee hired to a state directory of new hires.

But even with all these legal and administrative tools, there is still in excess of $90 Billion in past due support owed to 20 million of our nation’s kids. The situation is so serious that it now has become necessary to attach insurance proceeds to collect support that is past due to our country’s children.

In October 2002, a multi- state conference was held to discuss child support issues. One feature of the Office of Child Support Enforcement, OCSE, Commissioner Sherri Z. Heller’s presentation at The Western Interstate Child Support Enforcement Council (WICSEC) conference was a discussion of what she referred to as “going the extra mile” and “reaching out to partners that help collect and distribute more child support.” and “actually get more resources to do our job.” The CSLN program is clearly addressing these issues.

So far, several states, such as Rhode Island, Massachusetts and New Jersey, have passed specific legislation requiring insurance companies to search state records to determine if claimants are also delinquent child support obligors, and then make offsets from the settlements towards those debts. These individual state laws and procedures have proved to be intrusive on insurance company operations. Rhode Island, New Jersey and many other states have implemented a new electronic insurance claim intercept process in a way that is much more friendly to insurance company operations, and without the need for additional state or federal mandates – the CSLN Electronic Interface way!
At the end of August 2003, the Child Support Lien Network contained 1,893,283 delinquent obligor cases that owe $38 Billion in past due support. Over the next two years, the CSLN network is projected to incorporate all of the nation’s 10 million delinquent obligor cases owing a staggering $90 Billion in child support arrears. Although these figures appear daunting each insurance company has the power to make a significant difference in lives of millions of our nation’s children with very little effort.

Child Support will become a small but very important part of an insurance company’s customer service and good will efforts- to do a good job for the sake of our children! The CSLN is the method that can help us all avoid bothersome laws, intrusive processes and nuisance subpoenas. We want insurance companies to provide access to their claim data to CSLN now and do it voluntarily.

Experience with the electronic interface over the past year has shown that while approximately 4% of delinquent obligors in this country match to an insurance claim each year, the impact on individual insurance companies is minimal. Because there are so many companies involved, CSLN cases only matched to an average 0.5% of a company’s total claims this past year. Another great aspect about the CSLN process is that insurance companies are protected from liability for their cooperation in providing this data for child support purposes by federal and state laws.

In the past, it was a relatively rare occurrence that Child Support agencies would receive a payment from an insurance settlement. Child support officials collected monies from insurance claims only after the happenstance of coming upon the knowledge of such claim settlement information provided by the custodial parents or third parties. Often, opportunities to collect from the claim settlement were missed because the information about the asset became known too late. The new CSLN daily interface with insurance databases provides Child Support agencies and insurance companies with sufficient time to send and receive legal notices and liens for future collection.

Can you imagine just how big an impact an insurance offset could make in children’s lives? In December 2002, the State of Texas received an insurance settlement payment for $38,186.00 that was redirected to the claimant’s children in three separate child support cases. In the first two cases, the arrears owed were reduced to zero and in the third case to a mere $280.00. The claimant agreed to write a check for the remainder, thereby eliminating his arrears with all three families! With his slate wiped clean from owing past due child support, the claimant is more able to manage payment of his ongoing monthly child support obligation and now feels more comfortable in making contact with his children.

$2 Billion in potential collections each and every year from the insurance industry would make such collections the greatest and most significant single source of funds ever collected by the child support enforcement program – even greater than federal offsets of income tax refunds that now account for $1.8 Billion in annual arrearage collections. The insurance industry could be the Number One resource for child support collections! And could there be any greater good will to be had?

Now you can surely see why, we are so excited about the potential collections from insurance claims. We need every insurance company to participate immediately.

Although some of the states we have in CSLN may not be those in which a particular company writes a lot of insurance business, we can assure you that it is very important for those states to be able to match their children’s arrears records against all insurer’s claim records. Why? Because approximately 30% of delinquent obligors in the country do not live in the same state as their children and there is a very good chance that the claimants children reside in states where the company is not that active. These claims can be attached through CSLN for these families. And this will only occur when insurance companies open their entire claim file to our CSLN process.

As we can gain national insurance participation in the CSLN interface process we will be able to show the whole country just how really wonderfully the insurance industry has responded to this public-private endeavor without the need for further mandates. Thank you in advance for being a champion for these deserving kids.