Protecting program integrity with better data

The COVID-19 pandemic has caused a dramatic spike in social safety net applications across the country. What started with record unemployment claims is now putting pressure on social service programs like SNAP, and county and state caseworkers are struggling to keep up. The volume of applications coupled with a typically manual process for validating applicant information is a potential recipe for delays and incorrect payments that benefit no one.

Access to data can help, but access to timely data can make a real difference. The federal agencies that manage social service programs have expectations for program integrity, or as the Centers for Medicare & Medicaid Services (CMS) calls it “pay it right.” According to a 2018 Equifax survey of social service benefit directors, one-third of city and county benefit administrators ranked “improving program integrity to ensure the right people get the right benefit” as their number one priority.  When incorrect data is used to make a decision, it creates increased workload across multiple departments and functions, triggering investigations and additional fact-checking, delaying payments to constituents and opening the door to fraud.

Let’s take a very basic example using the Supplemental Nutrition Assistance Program (SNAP).

To apply for SNAP, individuals must meet certain requirements, including resource and income limits and the application for benefits includes income information requests. Verifying that information is left up to the state or county caseworkers who may rely on paystubs, which are incredibly manual for both applicant and caseworkers alike.

The same Equifax survey showed that some government datasets were also used for validating income. But more often than not those databases and directories are outdated before they are even published.

Most benefit administrators have access to the State Wage Database to help check self-reported income statements; however, information reported to that database can be anywhere from 30 to 120 days old since it is gathered monthly and then released the following quarter.

The Equifax survey found that IRS data is the second-most utilized government dataset used to verify employment and income. Tax return data is generally annual, which means the information is at least a year and possibly up to 15 months old.  The 2019 returns will be even more outdated with some up to 18 months old when you consider that the filing deadline was extended by the IRS to July 15, 2020.

Other data sources accessed by county caseworkers could include the National Directory of New Hires, which gathers the state wage data the quarter after it’s been reported, so it’s also significantly outdated. While it does include New Hire Data reported by employers and published monthly, it is hiring data and not income or separations.

Furthermore, analysis of 2018 income data from The Work Number® database, shows that the median monthly income of individuals changed as much as 20% month-over-month. Even in that short timeframe, those shifts are meaningful to individuals applying for aid and those who request extended benefits through re-certification of eligibility. Imagine how much that variance may have changed over the last three months given the current public health crisis.

To make an efficient and confident eligibility determination and “pay it right,” especially now that the economic situations are changing so quickly for so many, caseworkers need access to more timely data. Both state and county managed social service programs like unemployment, Medicaid and SNAP often look to external data providers. By moving to a “systems-first” approach, agencies can take advantage of an automatic, integrated system with access to multiple data sources like income, employment, incarceration status and assets instantly on one platform, rather than pulling from all the various data and platforms.

Government Business Council research shows that with an integrated system utilizing continuously updated payroll information, like The Work Number database, social service agencies have been able to double the caseload per case worker with greater accuracy and lower operational costs. Timely data is the core of this system; caseworkers get reliable and updated data, both from applicants and the sources against which the self-reported data is checked.

Having timely data also can make evaluating continued eligibility almost automatic. Integrated data allows caseworkers to set program alerts for recertification and the requirements to check for changes in an applicant’s employment or income and other significant life changes that might indicate additional need or adjustments related to incarceration, death, or even indications that the same individual may have applied for benefits in another state.

With demand high during the pandemic, “paying it right” is more critical than ever in order to best serve the needs of the community and avoid errors, fraud and incorrect payment. Continuous access to timely data is crucial and when coupled with an integrated system, helps caseworkers mitigate blind spots in application processing and program maintenance to deliver benefits faster and with greater accuracy to the increasing number of individuals in need.

Juan Cole is Vice President, Strategy and Solutions Consulting for Equifax Government Services. He works closely with government and industry partners to deploy data-driven solutions and trended data analysis that address the ever-changing challenges faced by government clients. He leads a service architect team that supports clients in CMS SSA, and state healthcare government agencies to implement solutions that help mitigate risk, prevent improper payments, facilitate verifications, and improve program integrity.