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1 1 (March 10, 2025)

handle is hein.crs/govesrj0001 and id is 1 raw text is: Congressional Research Service informing the legislative debate since 1914 0 March 10, 2025 Using Data to Reduce Improper Payments: An Overview of the Do Not Pay Initiative Payment integrity-ensuring that payments issued by federal agencies are accurate and proper-is a central concern in the stewardship of taxpayers' dollars. The Office of Management and Budget (OMB) identifies data and information access issues as being among the root causes of improper payments. Improper payments are those that should not have been made or were made in incorrect amounts, including overpayments and underpayments, under a statutory, contractual, administrative, or other legally applicable requirement (31 U.S.C. §3351(4)). OMB characterizes a root cause as something that would directly lead to an improper payment, and if corrected, would prevent the improper payment. According to data available on paymentaccuracy.gov, between FY2021 and FY2024, agencies estimated that a total of $765.8 billion in overpayments was caused by data or information access issues (see Figure 1). OMB describes three ways this might occur: (1) an agency fails to access available data; (2) an agency is unable to access available data (e.g., because statute restricts access in some way); or (3) the needed data do not exist (e.g., there is no known data source). Figure I. Overpayments Due to Data Access Issues Total for FY2021 -FY2024 Is $765.8 Billion FYTotal in Millions MFailue to ?acess $300,000 ava oab e data $250,000 Inability to access available data $260,000 * Needed data does not exist $150,00 $160,000 $50,000 FY2021 FY2022 FY2023 FY2024 Source: CRS analysis of the 2024 improper payments ciataset on paymentaccuracy.gov. The Payment Integrity Information Act of 2019 (PIJA, P.L. 116-117) establishes government-wide requirements that are intended to reduce improper payments. Among its provisions, PIJA codifies the Do Not Pay (DNP) Initiative (31 U.S.C. §3354). Under this initiative, agencies have access to certain databases, enabling them to verify whether recipients are eligible to receive payments and prevent improper payments in cases of ineligibility. Type of Dat Needed As part of their annual reporting for paymentaccuracy.gov, agencies identify the types of data needed to determine whether a payment would be proper. OMB's guidance lists several different types of data, such as data related to address or location (e.g., place of residency or of a property); the status of a contractor or provider (e.g., contractor standing and suspension determinations); financial status (e.g., value of assets, credit history, tax exemption status); or identity-proving (e.g., verifying that people are whom they say they are). The data on paymentaccuracy.gov suggests contractor or provider status-related data caused the largest share of overpayments related to data access issues for FY2021-FY2024 ($232.1 billion). The Do Not Pay Intative In general, PIIA requires agencies to ensure that their preaward and prepayment procedures provide for a thorough review of available databases with relevant information on eligibility prior to the release of any funds (31 U.S.C. §3354(a)). Preaward and prepayment procedures-which may also be referred to as internal controls within an agency-are generally considered essential for avoiding the more reactive pay and chase approach, where improper payments are disbursed and then agencies attempt to recover or recoup those funds. Using Databases The DNP Initiative involves using databases to verify the eligibility of a recipient to receive a payment. This includes (1) certain databases enumerated specifically in statute, as discussed below, and (2) other databases designated by the OMB director that substantially assist in preventing improper payments (31 U.S.C. §3354(b)(1)). The OMB director's designations are subject to a public notice and comment period (31 U.S.C. §3354(b)(2)(B)). OMB has exercised its authority to expand the databases available to agencies through the DNP Initiative, including access to some databases maintained by federal agencies and to some nonfederal databases as well. The use of databases enables data matching, where data concerning a potential payment recipient can be matched and compared with data from different data systems. Prior to issuing any award or payment, each executive agency is instructed to at a minimum review (1) the incarceration records maintained under 42 U.S.C. §402(x)(3) and §1382(e)(1)(I) and the death records maintained by the Commissioner of Social Security; (2) the General Services Administration's System for Award Management exclusion records; (3) the Department of the Treasury's Debt Check Database (associated with the Treasury Offset Program); (4) the Department of Housing and Urban Development's Credit Alert System (also referred to as the Credit Alert

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