Iowa Workforce Development paid $239k to ineligible claimants in FY20

(The Center Square) – The Iowa Auditor of State’s latest audit report said the Iowa Department of Workforce Development paid unemployment compensation to eight incarcerated prisoners and six deceased people, totaling $238,511 in overpayments, in fiscal year 2020.

Under the Social Security Act, claimants must be “able to work” and “available to work.” During the 2020 fiscal year, the IWD did not compare unemployment claimants with available prisoner data. It also said department policies and procedures were not established to require cross-matching data, which auditors recommended.

The report noted the IWD “resumed” receiving incarceration data, including social security numbers of prisoners, as of Feb. 8, 2021, and that IWD would, going forward, receive the data monthly and immediately investigate claims.

Iowa Department of Workforce Development Public Information Officer Jesse Dougherty told The Center Square the department’s $238,511 in improper payments are of a type the agency “normally sees in fraud cases.”

“These payments, which came at a time when many IWD employees were pulled off their regular duties to respond to COVID-19, represent roughly 0.01% of the $2.25 billion in unemployment benefits that IWD paid out that [fiscal] year,” Dougherty said. “As noted in the report, we already have taken steps to investigate these instances and block such overpayments in the future.”

Dougherty said Wednesday that the majority of issues stated in the audit occurred in the months of fiscal year 2020 in which Iowa faced the pandemic.

Doughty told The Center Square there have been continuous efforts in the past few years to address fraud and IWD is continuously working to address fraud and efficiency of serving claimants.

“There’s always going to be fraud every year, and there’s always going to be corrections,” Dougherty said.

The cause of the payments to the deceased individuals was related to staffing and the thousands of claims the department received during the beginning of the pandemic, the report said.

“Due to a massive influx of claims beginning March of 2020, staff members from all bureaus, including investigations, were directed to assist with pandemic related claims,” the report said, addressing the inappropriate fiscal year 2020 payments. “This included claims processing, answering phone calls on the customer service line and conducting two-party fact findings. Because investigations staff were required to work these areas, normal investigations work, including monitoring the SSA Reports of Deceased Claimants, was delayed.”

The IWD will continue to have third-party vendors crossmatch Social Security numbers between claimants and deceased people, and flag ineligible applications, the report said.

The department is partnering with the Iowa Department of Public Health to gain immediate access to Social Security numbers of deceased individuals to augment the “daily and or weekly access” to a Social Security Administration report that shows which social security numbers belong to people who have recently died, the IWD’s response in the report said. Investigators will cross-train to use reports from third-party vendors, the SSA and the IDPH.

Dougherty said the Reemployment Case Management program the department plans to launch next year will increase the work search activity requirements for unemployment claimants, and is designed to help Iowans return to work more quickly, not take benefits away, since smaller gaps in employment will be better for Iowans’ employment opportunities.

“It’s trying to improve the system,” Dougherty said.

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