Improper payments have been a growing challenge for government entities as they work to support citizens in times of crisis. In 2019, over $175 billion in improper payments were issued by the Federal Government. That’s a 15% increase from 2018. Underlying factors around improper payments are not always due to fraud—inaccurate citizen data, coding errors, and the lack of a single source of truth also compound the problem.
These challenges will increase as Federal and State governments look to support citizens in the age of COVID-19 and counteract the pandemic’s disastrous effects on the global economy and job sustainability. Agencies are already stretched thin in terms of budget and personnel to take on such monumental tasks. Whether dealing with unemployment, food assistance, or stimulus payments, Federal and State programs have had challenges with not only the timely distribution of payments, but also with payments going to the people who need it most. Recent news has focused on the millions of dollars in stimulus checks being sent to deceased people. When that money is lost, it is almost impossible to retrieve.
With the advent of the CARES Act, which is focused on providing “fast and direct economic assistance for American workers and families, small businesses, and preserves jobs for American industries [sic],” there has been a great deal of risk surrounding the threat of improper payments. According to paymentaccuracy.gov:
“The term ‘improper payment’ [refers to] payments made by the government to the wrong person, in the wrong amount, or for the wrong reason. Although not all improper payments are fraud, and not all improper payments represent a loss to the government, all improper payments degrade the integrity of government programs and compromise citizens’ trust in government.”
How can agencies ensure payments get to the right person, in the right amount, and for the right reason? Trusted data is paramount, which requires data management capabilities around data quality, data security, master data management, and data governance:
With these core data management capabilities in place, agencies across Federal and State governments can dramatically reduce the risk of improper payments and support citizens when they need it most.