Public Assistance Program Integrity

1. Require Automated Eligibility Checks to Help Better Screen Recipient Eligibility in Real Time

2. Give Iowa DHS Workers the Necessary Tools to More Efficiently Perform Eligibility Checks

 

Iowa has an ever-growing Medicaid problem. Under the current, federally-declared COVID-19 health emergency, individuals enrolled in Medicaid at any point during the pandemic cannot be removed from the Medicaid rolls, even if they become otherwise ineligible. This has resulted in a significant increase in Medicaid enrollees.

The Center for Medicaid Services has indicated that this rule may be expiring at the end of 2021, though it is unknown at the time of publication of this issue guide whether that may be extended. Regardless, the time of disenrolling ineligible Medicaid recipients will likely be coming soon.

Now is the time to pass legislation requiring automated eligibility checks to help better screen recipient eligibility in real time. Presently, all verification checks at the Iowa Department of Human Services (DHS) are performed manually. This means that workers at DHS are required to contact 10-12 individuals daily to check all recipients annually, not taking into account the current backlog due to the health emergency rules. If DHS were to use the National Accuracy Clearinghouse software, workers would only need to contact individuals flagged by the system. If trends in other states are used as a guide, roughly 15 percent of public assistance recipients would be flagged for a verification check during standard times of public benefit administration. Further, individuals utilizing public assistance would be required to submit documentation much less frequently, easing the burden on those following the law. To clarify, if an individual is flagged, benefits are NOT automatically terminated; it is simply a prompt to DHS to follow up with the individual because there is a discrepancy in their file.

Per the 2018 Farm Bill, all states were to be using the National Accuracy Clearinghouse software to verify SNAP eligibility by 2021. Rules for this provision, however, are still pending. Unfortunately, Iowa has a history of inaccuracy when it comes to eligibility verification. On July 30, 2019, the U.S. Department of Agriculture (USDA) fined the State of Iowa $1.79 million due to a high error rate in the disbursement of SNAP benefits. In Fiscal Year 2018, Iowa’s SNAP error rate was over 10 percent. This puts Iowa’s SNAP overpayment rate at fifth highest in country, fourth if Washington, D.C., is excluded, and Iowa’s overall error rate was sixth highest in the country.

With a backlog of eligibility checks on the horizon, it is time to give workers at the Iowa DHS the necessary tools to more efficiently perform eligibility checks. People wrongfully receiving benefits may be choosing not to work or working less because the taxpayer is picking up the tab. To be clear, the intent of this eligibility verification tool is not to remove benefits from anyone who legitimately qualifies for public assistance; rather, the intent is to make sure that tax dollars are funding those who are truly in need in order to take some burden off hardworking taxpayers and encourage those wrongfully receiving benefits to return to the workforce.

 

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