[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[S. 2571 Introduced in Senate (IS)]







105th CONGRESS
  2d Session
                                S. 2571

     To reduce errors and increase accuracy and efficiency in the 
  administration of Federal benefit programs, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

              October 7 (legislative day, October 2), 1998

 Mr. Lieberman introduced the following bill; which was read twice and 
           referred to the Committee on Governmental Affairs

_______________________________________________________________________

                                 A BILL


 
     To reduce errors and increase accuracy and efficiency in the 
  administration of Federal benefit programs, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION. 1. SHORT TITLE.

    This Act may be cited as the ``Federal Benefit Verification and 
Integrity Act''.

SEC. 2. PURPOSES.

    The purposes of this Act are the following:
            (1) To reduce errors in Federal benefit programs that lead 
        to waste, fraud, or abuse and encourage agencies to work 
        together to identify common sources of errors.
            (2) To identify solutions to common problems that will save 
        money for the taxpayer and demonstrate the Government's ability 
        to deliver Federal benefits to the right person, at the right 
        time, for the right amount.
            (3) To focus on increasing accuracy and efficiency for 
        Federal benefit program eligibility, financial and program 
        management, and debt collection.
            (4) To improve the coordination of Government information 
        resources across Government agencies to strengthen the delivery 
        of Federal benefits.
            (5) To balance the need for data in verifying eligibility 
        with the paperwork burden and privacy intrusion that data 
        sharing imposes.
            (6) To emphasize deterring and preventing fraud in the 
        provision of Federal benefits, rather than seeking to detect 
        fraud after Federal benefits have been provided.
            (7) To ensure that agencies administering federally funded 
        benefit programs inform applicants applying for benefits under 
        those programs that their data can be shared to verify their 
        eligibility for those benefits.
            (8) To encourage individuals to provide accurate 
        information when applying for benefits under federally funded 
        benefit programs.

SEC. 3. DEFINITIONS.

    In this Act:
            (1) Board.--The term ``Board'' means the Federal Benefit 
        Verification and Payment Integrity Board established under this 
        Act.
            (2) Federal benefit program.--The term ``Federal benefit 
        program'' means any program administered or funded by the 
        Federal Government, or by any agent or State on behalf of the 
        Federal Government, providing cash assistance or in-kind 
        assistance in the form of payments, grants, loans, or loan 
        guarantees to or for the benefit of any person.

  TITLE I--NOTIFICATION OF FEDERAL BENEFIT RECIPIENTS REGARDING DATA 
                              VERIFICATION

SEC. 101. PROGRAM AGENCY RESPONSIBILITY TO PROVIDE CORRECT INFORMATION.

    (a) In General.--An agency that administers a Federal benefit 
payment program shall provide notice informing applicants under the 
program, in information material and instructions accompanying program 
application forms, that applicants' data may be verified to the extent 
permitted by law.
    (b) Agency Compliance.--An agency may comply with subsection (a) by 
modifying program materials and applications to include such notice as 
part of their normal reissuance cycle for reprinting forms, but in no 
case later than December 31, 2000.
    (c) Record of Acknowledgments.--The head of each agency that 
administers a Federal benefit program shall maintain a record of each 
applicant's acknowledgment that the applicant has received notice of 
the uses and disclosures to be made of the applicant's information, for 
as long as the applicant receives benefits from or owes a debt to the 
Government under the program.

     TITLE II--FEDERAL BENEFIT PROGRAM MANAGEMENT IMPROVEMENT TESTS

SEC. 201. TESTS OF PRACTICES AND TECHNIQUES FOR IMPROVING FEDERAL 
              BENEFIT PROGRAM MANAGEMENT.

    (a) Authority To Conduct Tests.--
            (1) In general.--A Federal agency that administers a 
        Federal benefit program may conduct a test of information 
        technology practices or techniques to improve income 
        verification, debt collection, data privacy and integrity 
        protection, and identification authentication in the 
        administration of the program, in accordance with a proposal 
        approved by the Federal Benefit Verification and Payment 
        Integrity Board established by this title.
            (2) Waiver of regulations.--Upon the request of the Board, 
        the head of an agency may waive the enforcement of any 
        regulation of the agency for the purposes of carrying out a 
        test under this section.
            (3) Identification of test areas.--The Director of the 
        Office of Management and Budget and the Chief Information 
        Officers' Council shall each recommend to the Board, within 120 
        days after the date of enactment of this Act, various 
        information technology practices and techniques that should be 
        tested under this title.
    (b) Approval of Agency Proposals.--
            (1) In general.--The head of a Federal agency may develop 
        and submit to the Board a proposal for carrying out a test 
        under this section for a specific Federal benefit program 
        administered by the agency. The proposal shall contain specific 
        goals, including a schedule, for improving customer service and 
        error reduction in the program and other information requested 
        by the Board.
            (2) Contents.--The proposal shall provide for the testing 
        of information sharing in an integrated manner where feasible 
        of electronic practices and techniques for improving Federal 
        benefit program management, including the following:
                    (A) Use of encryption and electronic signature 
                technology consistent with techniques acceptable to the 
                National Institute of Standards and Technology, to 
                protect the confidentiality and integrity of 
                information.
                    (B) Use of other security controls and monitoring 
                tools.
                    (C) Use of risk profiles and risk alert 
                technologies, including use of Federal, State, and 
                private databases such as the National Directory of New 
                Hires, Federal and State tax data, and credit bureau 
                data.
                    (D) Establishment of a management framework for 
                exploring and reducing the information security risks 
                associated with Federal agency operations and 
                technologies, including risk assessments and disaster 
                recovery planning.
            (3) Consultation.--Any agency whose proposals would require 
        access to another agency's database shall consult with that 
        agency prior to submission of the proposal to the Board, 
        including consultation with the appropriate data integrity 
        board.
            (4) Privacy safeguards.--A proposal submitted to the Board 
        must contain a description of appropriate administrative, 
        technical, and physical safeguards to ensure the security and 
        confidentiality of records and to protect against any 
        anticipated threats or hazards to their security or integrity 
        which could result in substantial harm, embarrassment, 
        inconvenience, or unfairness to any individual with respect to 
        whom information is maintained. The proposal shall include, in 
        particular, prohibitions on duplication and redisclosure of 
        records provided by the source agency within or outside the 
        recipient entity, except where required by law or essential to 
        the conduct of the test.
            (5) Agency reimbursement.--The proposal shall include an 
        estimate for reimbursement that may be charged by a Federal 
        agency to another agency in conducting tests under the 
        proposal.
            (6) Review of proposals.--Not later than 60 days after the 
        date of receipt of a proposal under this subsection, the Board 
        shall review and recommend disposition of the proposal to the 
        heads of the data sharing agencies under the proposal. The head 
        of the agency shall respond to the Board within 90 days. Such a 
        response shall include findings as appropriate by the data 
        integrity board.
    (c) Cooperative Agreements and Contracts.--The head of an agency 
participating in a test under this section, in consultation with the 
Board, may enter into a cooperative agreement with a State or contract 
with a private entity under which the State or private entity, 
respectively, may provide services on behalf of the Federal agency in 
carrying out the test.
    (d) General Implementation Plan.--The Board shall prepare a plan 
for the implementation of this section, including for the coordination 
of the conduct of tests under this title and the procedures for 
submission of proposals for those tests.
    (e) Reports on Results of Tests.--
            (1) Annual report.--Beginning not later than 1 year after 
        the date of enactment of this Act, the Board shall submit 
        annually to the Congress a report on the tests conducted under 
        this section.
            (2) Content.--The report shall include--
                    (A) an estimate of potential cost savings and other 
                impacts demonstrated by the tests;
                    (B) an analysis of the feasibility of applying the 
                practices and techniques demonstrated in each test 
                within the Federal Government, including analysis of 
                what was the least amount of information that was 
                necessary to verify eligibility of applicants under 
                each Federal benefit program that participated in the 
                tests;
                    (C) an assessment of the value of State data in 
                those tests. and
                    (D) such recommendations as the Board considers 
                appropriate.
    (f) Recommendations on Implementation of Act.--The Chairperson of 
the Board shall make recommendations annually to the Director of the 
Office of Management and Budget regarding how savings resulting from 
the implementation of the Federal Benefit Verification and Integrity 
Act may be used to enhance program integrity in high-risk programs such 
as Medicare and to reduce the potential of waste, fraud, and erroneous 
payments.
    (g) Authority To Request Test.--The Board may request the head of a 
Federal agency that administers a Federal benefit program to conduct a 
test under this section, including the preparation and submission of a 
proposal for such a test in accordance with this section. The head of 
an agency shall respond within 30 days by approving or disapproving 
such a request of the Board.
    (h) Use of Test Information.--Information on any individual 
obtained in the course of a test under this section shall not be used 
as the exclusive basis of a decision concerning the rights, benefits, 
or privileges of any individual.

SEC. 202. SHARING OF INFORMATION IN NATIONAL DIRECTORY OF NEW HIRES.

    (a) Availability of Information.--Notwithstanding section 453(l) of 
the Social Security Act (42 U.S.C. 653(l)), the Secretary of Health and 
Human Services may disclose information to another Federal agency from 
the National Directory of New Hires established pursuant to section 
453(i) of that Act (42 U.S.C. 653(i)) based on matches conducted by the 
Department of Health and Human Services for purposes of conducting a 
test under this title. In determining whether to disclose such 
information to a Federal agency for such a test, the Secretary shall 
take into consideration the potential negative impact of the disclosure 
or use of such information on the effective operation of the Federal 
Parent Locator Service under section 453 of such Act, and of other 
Federal and State child support enforcement activities under part D of 
title IV of such Act.
    (b) Fee.--The head of an agency to which information is disclosed 
pursuant to subsection (a) shall reimburse the Secretary of Health and 
Human Services in accordance with section 453(k)(3) of the Social 
Security Act.
    (c) Authority To Disclose Information.--The head of an agency to 
whom information is disclosed under this section may disclose the 
information to another Federal agency for use by the agency only as 
specified under a test proposal under this title. The head of a Federal 
agency to whom information is disclosed under this subsection may 
disclose such information to a State agency administering a federally 
funded benefit program, a public housing authority, or a guaranty 
agency (as that term is defined in section 435(j) of the Higher 
Education Act of 1965) only for the purpose of conducting the test.
    (d) Redisclosure Limitation.--An entity that receives information 
for use in a test under this title that it was not otherwise authorized 
by law to obtain may not redisclose the information or use it for any 
other purpose.
    (e) Sharing of State Information.--The provision of information 
pursuant to subsection (a) shall not affect any determination of 
whether a State meets the requirements of section 303(h)(1)(C) of the 
Social Security Act.

SEC. 203. INCREASED PENALTIES AND PUNITIVE DAMAGES UNDER PRIVACY ACT.

    (a) Increased Penalties.--Section 552a(i) of title 5, United States 
Code, is amended in each of paragraphs (1) and (3) by striking ``shall 
be guilty'' and all that follows through the period and inserting 
``shall be fined not more than $10,000, imprisoned for not more than 
one year, or both.''.
    (b) Punitive Damages.--Section 552a(g)(4) of title 5, United States 
Code, is amended--
            (1) by redesignating subparagraphs (A) and (B) as clauses 
        (i) and (ii), respectively;
            (2) by inserting ``(A)'' after ``(4)''; and
            (3) by adding at the end the following:
``(B) In any such suit in which the court determines that the agency 
acted in a manner that was willful and intentional, the court may award 
punitive damages in addition to damages and costs referred to in 
subparagraph (A).''.

SEC. 204. ESTABLISHMENT OF THE FEDERAL BENEFIT VERIFICATION AND PAYMENT 
              INTEGRITY BOARD.

    (a) Establishment.--There is established the Federal Benefit 
Verification and Payment Integrity Board.
    (b) Membership.--The Board shall be composed of 10 members 
appointed from among Federal or State employees, as follows:
            (1) 3 members, of whom one shall be appointed by the head 
        of each of 3 Federal agencies designated by the Director of the 
        Office of Management and Budget. The Director shall designate 
        agencies under this paragraph from among the Federal agencies 
        responsible for administering Federal benefit programs.
            (2) 2 members appointed by the Director of the Office of 
        Management and Budget, of whom at least one shall be a State 
        employee appointed to represent federally funded State 
        administered benefits programs.
            (3) 1 member appointed by the Secretary of Health and Human 
        Services.
            (4) 1 member appointed by the Secretary of the Treasury.
            (5) 1 member appointed by the Commissioner of Social 
        Security.
            (6) 1 member appointed by the Secretary of Labor.
            (7) 1 member appointed by the Director of the Office of 
        Management and Budget to address privacy concerns.
    (c) Chairperson.--The Director of the Office of Management and 
Budget shall designate one of the members of the Board as the 
chairperson of the Board.
    (d) Administrative Support.--The heads of Federal agencies having a 
member on the Board may provide to the Board such administrative and 
other support services and facilities as the Board may require to 
perform its functions under this title.
    (e) Travel Expenses.--Members of the Board shall receive travel 
expenses, including per diem in lieu of subsistence, in accordance with 
sections 5702 and 5703 of title 5, United States Code.
    (f) Reports.--The Board shall periodically report to the Director 
of the Office of Management and Budget regarding its activities.

SEC. 205. RECIPIENT BENEFIT ACCESS; IMPLEMENTATION OF TESTED 
              INFORMATION TECHNOLOGY PRACTICES OR TECHNIQUES.

    (a) Commercial Services for Electronic Submissions.--
            (1) In general.--The Administrator of General Services may 
        acquire on behalf of Federal agencies commercial services for 
        accepting electronic payments for grants or loans and 
        electronic claims submissions from the public. Such services 
        shall be based on accepted commercial practices for electronic 
        identification, authentication, and income verification.
            (2) Agency regulations.--The head of each Federal agency 
        shall promulgate regulations providing for the use of the 
        services described in paragraph (1) by program recipients.
            (3) Funding.--The Administrator may expend such funds as 
        may be required for the design, testing, and pilot of a 
        standard method by which the public may be provided consistent, 
        secure, and convenient electronic access in applying to Federal 
        agencies for loans and grants and in submitting claims. 
        Beginning in fiscal year 2002, the Administrator may finance 
        the acquisition and management of the commercial services 
        described in paragraph (1).
            (4) Definition of electronic.--For purposes of this 
        subsection, the term ``electronic'' means through the Internet 
        or telephonically.
    (b) Recommendations.--If the Board determines that any information 
technology practice, technique, or information sharing initiative 
tested under this title was successfully demonstrated in the test and 
should be implemented in the administration of a Federal benefit 
program, the Board shall--
            (1) recommend regulations or legislation to implement that 
        practice, technique, or initiative, if the Board determines 
        that implementation is not otherwise prohibited under another 
        law; or
            (2) include in its annual report to the Congress under 
        section 201 recommendations for such legislation as may be 
        necessary to authorize that implementation.
    (c) Requirements Regarding Data Processing Systems.--The Board 
shall include in any recommendation of regulations under subsection 
(a)--
            (1) provisions that ensure use of generally accepted data 
        processing system development methodology; and
            (2) provisions that will result in system architecture that 
        will facilitate information exchange, increase data sharing, 
        and reduce costs, by elimination of redundancy in development 
        and acquisition of data processing systems.
                                 <all>