[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4053 Introduced in House (IH)]
112th CONGRESS
2d Session
H. R. 4053
To intensify efforts to identify, prevent, and recover payment error,
waste, fraud, and abuse within Federal spending.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
February 16, 2012
Mr. Towns (for himself, Mr. Platts, Mr. Schrader, Mr. Connolly of
Virginia, Mr. Altmire, Mr. Barrow, Mr. Bishop of Georgia, Mr. Boren,
Mr. Boswell, Mr. Cardoza, Mr. Cooper, Mr. Donnelly of Indiana, Mr.
Holden, Mr. Matheson, Mr. McIntyre, Mr. Michaud, Mr. Peterson, Mr. Ross
of Arkansas, Mr. David Scott of Georgia, Mr. Shuler, and Mr. Thompson
of California) introduced the following bill; which was referred to the
Committee on Oversight and Government Reform
_______________________________________________________________________
A BILL
To intensify efforts to identify, prevent, and recover payment error,
waste, fraud, and abuse within Federal spending.
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 ``Improper Payments Elimination and
Recovery Improvement Act of 2012''.
SEC. 2. DEFINITION.
In this Act, the term ``agency'' means an executive agency as that
term is defined under section 102 of title 31, United States Code.
SEC. 3. IMPROVING THE DETERMINATION OF IMPROPER PAYMENTS BY FEDERAL
AGENCIES.
(a) In General.--Section 2 of the Improper Payments Information Act
of 2002 (31 U.S.C. 3321 note) is amended--
(1) by redesignating subsections (b) through (g) as
subsections (c) through (h), respectively;
(2) by inserting after subsection (a) the following:
``(b) Improving the Determination of Improper Payments.--
``(1) In general.--The Director of the Office of Management
and Budget shall on an annual basis--
``(A) identify a list of high-priority Federal
programs for greater levels of oversight and review--
``(i) in which the highest dollar value or
highest frequency of improper payments occur;
or
``(ii) for which there is a higher risk of
improper payments; and
``(B) in coordination with the agency responsible
for administering the high-priority program, establish
annual targets and semi-annual or quarterly actions for
reducing improper payments associated with each high-
priority program.
``(2) Report on high-priority improper payments.--
``(A) In general.--Subject to Federal privacy
policies and to the extent permitted by law, each
agency with a program identified under paragraph (1)(A)
on an annual basis shall submit to the Inspector
General of that agency, and make available to the
public (including availability through the Internet), a
report on that program.
``(B) Contents.--Each report under this paragraph--
``(i) shall describe--
``(I) any action the agency--
``(aa) has taken or plans
to take to recover improper
payments; and
``(bb) intends to take to
prevent future improper
payments; and
``(ii) shall not include any referrals the
agency made or anticipates making to the
Department of Justice, or any information
provided in connection with such referrals.
``(C) Public availability on central website.--The
Office of Management and Budget shall make each report
submitted under this paragraph available on a central
website.
``(D) Availability of information to inspector
general.--Subparagraph (B)(ii) shall not prohibit any
referral or information being made available to an
Inspector General as otherwise provided by law.
``(E) Assessment and recommendations.--The
Inspector General of each agency that submits a report
under this paragraph shall--
``(i) review--
``(I) the assessment of the level
of risk associated with the applicable
program, and the quality of the
improper payment estimates and
methodology of the agency; and
``(II) the oversight or financial
controls to identify and prevent
improper payments; and
``(ii) provide recommendations, for
modifying any plans of the agency, including
improvements for improper payments
determination and estimation methodology.'';
(3) in subsection (d) (as redesignated by paragraph (1) of
this subsection), by striking ``subsection (b)'' each place
that term appears and inserting ``subsection (c)''; and
(4) in subsection (e) (as redesignated by paragraph (1) of
this subsection), by striking ``subsection (b)'' and inserting
``subsection (c)''.
(b) Improved Estimates.--
(1) In general.--Not later than 180 days after the date of
enactment of this Act, the Director of the Office of Management
and Budget shall provide guidance to agencies for improving the
estimates of improper payments under the Improper Payments
Information Act of 2002 (31 U.S.C. 3321 note).
(2) Guidance.--Guidance under this subsection shall--
(A) strengthen the estimation process of agencies
by setting standards for agencies to follow in
determining the underlying validity of sampled payments
to ensure amounts being billed are proper; and
(B) instruct agencies to give the persons or
entities performing improper payments estimates access
to all necessary payment data, including access to
relevant documentation;
(C) explicitly bar agencies from relying on self-
reporting by the recipients of agency payments as the
sole source basis for improper payments estimates;
(D) require agencies to include all identified
improper payments in the reported estimate, regardless
of whether the improper payment in question has been or
is being recovered;
(E) include payments to employees, including
salary, locality pay, travel pay, purchase card use,
and other employee payments, as subject to risk
assessment and, where appropriate, improper payment
estimation; and
(F) require agencies to tailor their corrective
actions for the high-priority programs identified under
section 2(b)(1)(A) of the Improper Payments Information
Act of 2002 (31 U.S.C. 3321 note) to better reflect the
unique processes, procedures, and risks involved in
each specific program.
SEC. 4. IMPROPER PAYMENTS INFORMATION.
Section 2(a)(3)(A)(ii) of the Improper Payments Information Act of
2002 (31 U.S.C. 3321 note) is amended by striking ``with respect to
fiscal years following September 30th of a fiscal year beginning before
fiscal year 2013 as determined by the Office of Management and Budget''
and inserting ``with respect to fiscal year 2014 and each fiscal year
thereafter''.
SEC. 5. DO NOT PAY INITIATIVE.
(a) Prepayment and Preaward Procedures.--
(1) In general.--Each agency shall review prepayment and
preaward procedures and ensure that a thorough review of
available databases with relevant information on eligibility
occurs to determine program or award eligibility and prevent
improper payments before the release of any Federal funds.
(2) Databases.--At a minimum and before issuing any payment
and award, each agency shall review as appropriate the
following databases to verify eligibility of the payment and
award:
(A) The Death Master File of the Social Security
Administration.
(B) The General Services Administration's Excluded
Parties List System.
(C) The Debt Check Database of the Department of
the Treasury.
(D) The Credit Alert System or Credit Alert
Interactive Voice Response System of the Department of
Housing and Urban Development.
(E) The List of Excluded Individuals/Entities of
the Office of Inspector General of the Department of
Health and Human Services.
(b) Do Not Pay Initiative.--
(1) Establishment.--There is established the Do Not Pay
Initiative which shall consist of--
(A) the databases described under subsection
(a)(2); and
(B) any other database designated by the Director
of the Office of Management and Budget in consultation
with agencies.
(2) Other databases.--In making designations of other
databases under paragraph (1)(B), the Director of the Office of
Management and Budget shall consider any database that assists
in preventing improper payments.
(3) Access and review by agencies.--For purposes of
identifying and preventing improper payments, each agency shall
have access to, and use of, the Do Not Pay Initiative to
determine payment or award eligibility when the Director of the
Office of Management and Budget determines the Do Not Pay
Initiative is appropriately established for the agency.
(4) Payment otherwise required.--When using the Do Not Pay
Initiative, an agency shall recognize that there may be
circumstances under which the law requires a payment or award
to be made to a recipient, regardless of whether that recipient
is on the Do Not Pay Initiative.
(c) Database Integration Plan.--Not later than 60 days after the
date of enactment of this Act, the Director of the Office of Management
and Budget shall provide to the Congress a plan for--
(1) inclusion of other databases on the Do Not Pay
Initiative;
(2) to the extent permitted by law, agency access to the Do
Not Pay Initiative; and
(3) the multilateral data use agreements described under
subsection (e).
(d) Initial Working System.--
(1) Establishment.--Not later than 90 days after the date
of enactment of this Act, the Director of the Office of
Management and Budget shall establish a working system for
prepayment and preaward review that includes the Do Not Pay
Initiative as described under this section.
(2) Working system.--The working system established under
paragraph (1)--
(A) may be located within an appropriate agency;
(B) shall include not less than 3 agencies as users
of the system; and
(C) shall include investigation activities for
fraud and systemic improper payments detection through
analytic technologies and other techniques, which may
include commercial database use or access.
(3) Application to all agencies.--Not later than January 1,
2013, each agency shall review all payments and awards for all
programs of that agency through the system established under
this subsection.
(e) Multilateral Data Use Agreements.--
(1) In general.--Not later than 60 days after the date of
enactment of this Act, the Director of the Office of Management
and Budget shall develop a plan to establish a multilateral
data use agreement authority to carry out this section,
including access to databases such as the New Hire Database
under section 453(i) of the Social Security Act (42 U.S.C.
653(i)).
(2) Privacy act matching agreements.--Section 552a(o)(1) of
title 5, United States Code, is amended in the matter preceding
subparagraph (A), by inserting ``or an agreement governing
multiple agencies'' before ``specifying''.
(3) General protocols and security.--
(A) In general.--In developing the multilateral
data use agreements, the Director of the Office of
Management and Budget shall establish implementing
regulations and guidelines that include streamlined
interagency processes to ensure agency access to data,
and provide for appropriate transfer and storage of any
transferred data, in a manner consistent with relevant
privacy, security, and disclosure laws.
(B) Consultation.--The Director of the Office of
Management and Budget shall consult with--
(i) the Council of Inspectors General on
Integrity and Efficiency before implementing
this paragraph; and
(ii) the Secretary of Health and Human
Services, the Social Security Administrator,
and the head of any other agency, as
appropriate.
(f) Development and Access to a Database of Incarcerated
Individuals.--Not later than 1 year after the date of enactment of this
Act, the Attorney General shall submit to Congress recommendations for
increasing the use of, access to, and the technical feasibility of
using data on the Federal, State, and local conviction and
incarceration status of individuals for purposes of identifying and
preventing improper payments by Federal agencies and programs and
fraud.
(g) Plan To Curb Federal Improper Payments to Deceased Individuals
by Improving the Quality and Use by Federal Agencies of the Social
Security Administration Death Master File.--
(1) Establishment.--In conjunction with the Commissioner of
Social Security and in consultation with relevant stakeholders
that have an interest in or responsibility for providing the
data, and the States, the Director of the Office of Management
and Budget shall establish a plan for improving the quality,
accuracy, and timeliness of death data maintained by the Social
Security Administration, including death information reported
to the Commissioner under section 205(r) of the Social Security
Act (42 U.S.C. 405(r)).
(2) Additional actions under plan.--The plan established
under this subsection shall include recommended actions by
agencies to--
(A) increase the quality and frequency of access to
the Death Master File and other death data;
(B) achieve a goal of at least daily access as
appropriate;
(C) provide for all States and other data providers
to use improved and electronic means for providing
data;
(D) identify improved methods by agencies for
determining ineligible payments due to the death of a
recipient through proactive verification means; and
(E) address improper payments made by agencies to
deceased individuals as part of Federal retirement
programs.
(3) Report.--Not later than 120 days after the date of
enactment of this Act, the Director of the Office of Management
and Budget shall submit a report to Congress on the plan
established under this subsection, including recommended
legislation.
SEC. 6. IMPROVING RECOVERY OF IMPROPER PAYMENTS.
(a) Definition.--In this section, the term ``recovery audit'' means
a recovery audit described under section 2(h) of the Improper Payments
Elimination and Recovery Act of 2010.
(b) In General.--The Director of the Office of Management and
Budget shall determine--
(1) current and historical rates and amounts of recovery of
improper payments (or, in cases in which improper payments are
identified solely on the basis of a sample, recovery rates and
amounts estimated on the basis of the applicable sample),
including specific information of amounts and payments
recovered by recovery audit contractors; and
(2) targets for recovering improper payments, including
specific information on amounts and payments recovered by
recovery audit contractors.
(c) Recovery Audit Contractor Programs.--
(1) Establishment.--Not later than 90 days after the date
of enactment of this Act, the Director of the Office of
Management and Budget shall establish a plan for no less than
10 Recovery Audit Contracting programs for the purpose of
identifying and recovering overpayments and underpayments in 10
agencies.
(2) Range of recovery audit contracting types.--Programs
established under paragraph (1) shall be representative of
different types of--
(A) programs, including programs that differ in
size, payment types, and recipient types (such as
beneficiaries and vendors or contractors) across the
Federal Government; and
(B) recover audit contracting (including individual
payments review and demographic analysis).
(3) Initial operation of programs.--Not later than 1 year
after the plan under paragraph (1) is established, each
applicable agency shall establish the programs included in that
plan which shall be conducted for not more than a 3-year
period.
(4) Reports.--
(A) In general.--Not later than 2 years after
establishing a program under the plan established under
paragraph (1), the head of the agency conducting the
program shall submit a report on the program to
Congress.
(B) Contents.--Each report under this paragraph
shall include--
(i) a description of the impact of the
program on savings and recoveries; and
(ii) such recommendations as the head of
the agency considers appropriate on extending
or expanding the program.
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