[Congressional Record Volume 158, Number 161 (Thursday, December 13, 2012)]
[House]
[Pages H6768-H6771]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
IMPROPER PAYMENTS ELIMINATION AND RECOVERY IMPROVEMENT ACT OF 2012
Mr. CHAFFETZ. Mr. Speaker, I move to suspend the rules and pass the
bill (H.R. 4053) to intensify efforts to identify, prevent, and recover
payment error, waste, fraud, and abuse within Federal spending, as
amended.
The Clerk read the title of the bill.
The text of the bill is as follows:
H.R. 4053
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. DEFINITIONS.
In this Act--
(1) the term ``agency'' means an executive agency as that
term is defined under section 102 of title 31, United States
Code;
(2) the term ``improper payment'' has the meaning given
that term in section 2(g) of the Improper Payments
Information Act of 2002 (31 U.S.C. 3321 note), as
redesignated by section 3(a)(1) of this Act; and
(3) the term ``State'' means each State of the United
States, the District of Columbia, each territory or
possession of the United States, and each federally
recognized Indian tribe.
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 rate 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.
[[Page H6769]]
``(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, for each program of the agency that is
identified under paragraph (1)(A)--
``(i) review--
``(I) the assessment of the level of risk associated with
the program, and the quality of the improper payment
estimates and methodology of the agency relating to the
program; and
``(II) the oversight or financial controls to identify and
prevent improper payments under the program; and
``(ii) submit to Congress recommendations, which may be
included in another report submitted by the Inspector General
to Congress, for modifying any plans of the agency relating
to the program, 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)'';
(4) in subsection (e) (as redesignated by paragraph (1) of
this subsection), by striking ``subsection (b)'' and
inserting ``subsection (c)''; and
(5) in subsection (g)(3) (as redesignated by paragraph (1)
of this subsection), by inserting ``or a Federal employee''
after ``non-Federal person or entity''.
(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, paid, or obligated for payment are proper;
(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.
(c) Technical and Conforming Amendments.--The Improper
Payments Elimination and Recovery Act of 2010 (Public Law
111-204; 31 U.S.C. 3321 note.) is amended--
(1) in section 2(h)(1), by striking ``section 2(f)'' and
all that follows and inserting ``section 2(g) of the Improper
Payments Information Act of 2002 (31 U.S.C. 3321 note).'';
and
(2) in section 3(a)--
(A) in paragraph (1), by striking ``section 2(f)'' and all
that follows and inserting ``section 2(g) of the Improper
Payments Information Act of 2002 (31 U.S.C. 3321 note).'';
and
(B) in paragraph (3)--
(i) by striking ``section 2(b)'' each place it appears and
inserting ``section 2(c)''; and
(ii) by striking ``section 2(c)'' each place it appears and
inserting ``section 2(d)''.
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 include--
(A) use of the databases described under subsection (a)(2);
and
(B) use of other databases designated by the Director of
the Office of Management and Budget in consultation with
agencies and in accordance with paragraph (2).
(2) Other databases.--In making designations of other
databases under paragraph (1)(B), the Director of the Office
of Management and Budget shall--
(A) consider any database that substantially assists in
preventing improper payments; and
(B) provide public notice and an opportunity for comment
before designating a database under paragraph (1)(B).
(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 verify payment or award eligibility in accordance with
subsection (a) 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 identified as potentially ineligible under the
Do Not Pay Initiative.
(5) Annual report.--The Director of the Office of
Management and Budget shall submit to Congress an annual
report, which may be included as part of another report
submitted to Congress by the Director, regarding the
operation of the Do Not Pay Initiative, which shall--
(A) include an evaluation of whether the Do Not Pay
Initiative has reduced improper payments or improper awards;
and
(B) provide the frequency of corrections or identification
of incorrect information.
(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 data use agreements described under subsection
(e)(2)(D).
(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 June 1,
2013, each agency shall review all payments and awards for
all programs of that agency through the system established
under this subsection.
(e) Facilitating Data Access by Federal Agencies and
Offices of Inspectors General for Purposes of Program
Integrity.--
(1) Definition.--In this subsection, the term ``Inspector
General'' means any Inspector General described in
subparagraph (A), (B), or (I) of section 11(b)(1) of the
Inspector General Act of 1978 (5 U.S.C. App.) and any
successor Inspector General.
(2) Computer matching by federal agencies for purposes of
investigation and prevention of improper payments and
fraud.--
(A) In general.--Except as provided in this paragraph, in
accordance with section 552a of title 5, United States Code
(commonly known as the Privacy Act of 1974), each Inspector
General and the head of each agency may enter into computer
matching agreements with other inspectors general and agency
heads that allow ongoing data matching (which shall include
automated data matching) in order to assist in the detection
and prevention of improper payments.
(B) Review.--Not later than 60 days after a proposal for an
agreement under subparagraph (A) has been presented to a Data
Integrity Board established under section 552a(u) of title 5,
United States Code, for consideration, the Data Integrity
Board shall respond to the proposal.
(C) Termination date.--An agreement under subparagraph
(A)--
(i) shall have a termination date of less than 3 years; and
(ii) during the 3-month period ending on the date on which
the agreement is scheduled to terminate, may be renewed by
the agencies entering the agreement for not more than 3
years.
[[Page H6770]]
(D) Multiple agencies.--For purposes of this paragraph,
section 552a(o)(1) of title 5, United States Code, shall be
applied by substituting ``between the source agency and the
recipient agency or non-Federal agency or an agreement
governing multiple agencies'' for ``between the source agency
and the recipient agency or non-Federal agency'' in the
matter preceding subparagraph (A).
(E) Cost-benefit analysis.--A justification under section
552a(o)(1)(B) of title 5, United States Code, relating to an
agreement under subparagraph (A) is not required to contain a
specific estimate of any savings under the computer matching
agreement.
(3) Guidance by the office of management and budget.--Not
later than 6 months after the date of enactment of this Act,
and in consultation with the Council of the Inspectors
General on Integrity and Efficiency, the Secretary of Health
and Human Services, the Commissioner of Social Security, and
the head of any other relevant agency, the Director of the
Office of Management and Budget shall--
(A) issue guidance for agencies regarding implementing this
subsection, which shall include standards for--
(i) reimbursement of costs, when necessary, between
agencies;
(ii) retention and timely destruction of records in
accordance with section 552a(o)(1)(F) of title 5, United
States Code; and
(iii) prohibiting duplication and redisclosure of records
in accordance with section 552a(o)(1)(H) of title 5, United
States Code;
(B) review the procedures of the Data Integrity Boards
established under section 552a(u) of title 5, United States
Code, and develop new guidance for the Data Integrity Boards
to--
(i) improve the effectiveness and responsiveness of the
Data Integrity Boards;
(ii) ensure privacy protections in accordance with section
552a of title 5, United States Code (commonly known as the
Privacy Act of 1974); and
(iii) establish standard matching agreements for use when
appropriate; and
(C) establish and clarify rules regarding what constitutes
making an agreement entered under paragraph (2)(A) available
upon request to the public for purposes of section
552a(o)(2)(A)(ii) of title 5, United States Code, which shall
include requiring publication of the agreement on a public
website.
(4) Corrections.--The Director of the Office of Management
and Budget shall establish procedures providing for the
correction of data in order to ensure--
(A) compliance with section 552a(p) of title 5, United
States Code; and
(B) that corrections are made in any Do Not Pay Initiative
database and in any relevant source databases designated by
the Director of the Office of Management and Budget under
subsection (b)(1).
(5) Compliance.--The head of each agency, in consultation
with the Inspector General of the agency, shall ensure that
any information provided to an individual or entity under
this subsection is provided in accordance with protocols
established under this subsection.
(6) Rule of construction.--Nothing in this subsection shall
be construed to affect the rights of an individual under
section 552a(p) of title 5, United States Code.
(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
(31 U.S.C. 3301 note).
(b) Review.--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 a list of agency recovery audit contract
programs and 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.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Utah (Mr. Chaffetz) and the gentleman from New York (Mr. Towns) each
will control 20 minutes.
The Chair recognizes the gentleman from Utah.
General Leave
Mr. CHAFFETZ. Mr. Speaker, I ask unanimous consent that all Members
may have 5 legislative days within which to revise and extend their
remarks and to include extraneous materials on the bill under
consideration.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Utah?
There was no objection.
Mr. CHAFFETZ. Mr. Speaker, I yield myself such time as I may consume.
Federal agencies made an estimated $108 billion in improper payments
in fiscal year 2012, and that is the estimate from the Office of
Management and Budget. Many programs maintain an alarming rate of
improper payments--some programs above 8 percent. This is an
unacceptable waste of taxpayer dollars.
I appreciate my colleague, the departing gentleman from New York (Mr.
Towns), for sponsoring this piece of legislation because here we are
fighting for fiscal sanity in this country, and we have $108 billion
estimated in improper payments.
These improper payments occur when Federal funds are paid out that
should not be paid out. In many instances, Federal funds are going out
to ineligible recipients. Last year, the Inspector General of the
Office of Personnel Management found that Federal retirement and
disability benefits totaling $600 million were paid out to deceased
individuals over a 5-year period.
The Oversight Committee and its subcommittees have held a series of
hearings in this Congress on the issuance of improper payments, and I
thank Chairman Issa for his leadership in holding these hearings and in
encouraging this piece of legislation to be brought to the floor. The
legislation introduced by Mr. Towns will help to address the concerns
identified at those hearings. H.R. 4053 builds on prior legislation to
reduce and prevent improper payments.
A decade ago, the Improper Payments Information Act of 2002 was
signed into law, compelling agencies to identify payment errors in
specific programs. That 2002 law was updated again in 2010 by the
Improper Payments Elimination and Recovery Act, which required the
better identification and estimation of improper payments. The bill
before us today goes even further, primarily by harnessing improved
information technology to reduce improper payments. It requires the
administration to implement a do-not-pay initiative, and it enables
Federal agencies to enter into multilateral data-sharing agreements.
I commend Mr. Towns for offering this important piece of legislation
and for helping to advance the effort to reduce waste in the Federal
Government.
I urge the passage of H.R. 4053, and I reserve the balance of my
time.
Mr. TOWNS. Mr. Speaker, I yield myself such time as I may consume.
First of all, I would like to thank the Members who worked very hard
to make this a reality, and I want to take the opportunity to applaud
the leadership and its commitment to the Members of Congress who have
worked so hard on this legislation--Senator Carper and Senator Collins
and, of course, Congressman Issa and Congressman Cummings from
Maryland. They have all worked very closely with us, along with my good
friend Congressman Platts, to make this day a reality.
[[Page H6771]]
Through its stewardship, the Subcommittee on Government Organization,
Efficiency and Financial Management has conducted a series of hearings
on the problems of improper payments, and this legislation is the
result of our findings on those hearings.
I also want to thank the staff who worked very hard on H.R. 4053. Of
course, it is a proud accomplishment when you listen to the stories of
people who are in the military and when you hear how they go months and
months without their families getting paid, that they are transferred
from one base to another and, as a result, the families do not get paid
because they're saying they cannot locate where they are. Of course,
many times when soldiers are transferred from one base to another,
you'll find that they are not able to get paid. I think that that's
something that we should abort because here they are defending this
country in a magnificent way, and we cannot find a way to get them
paid. This legislation points out how important it is to be able to get
them paid.
On that note, I yield 1 minute to the gentleman from Pennsylvania
(Mr. Altmire), who is very interested in this and who has expressed
over and over again how important it is to make certain that our
military people are paid and are paid on time.
Mr. ALTMIRE. I thank the gentleman, my good friend from New York.
Mr. Speaker, I rise in support of the Improper Payments Elimination
and Recovery Improvement Act, a bill that will help the Federal
Government better protect taxpayer dollars against waste, fraud, and
abuse.
According to the Government Accountability Office, as my friend from
Utah just said, the Federal Government made $108 billion in improper
payments during fiscal year 2012 alone, which is unacceptable. This
bill will increase transparency while eliminating and recovering these
improper payments through the creation of a government-wide do-not-pay
list. This list will prevent improper payments, such as Social Security
checks for deceased Americans, before that payment ever goes out.
The national deficit remains one of the biggest challenges facing
this country, and I am proud to cosponsor this bill because it protects
taxpayer dollars by forcing the Federal Government to scrutinize every
dollar spent--just like every American family does. I urge my
colleagues to support its passage.
Mr. CHAFFETZ. Mr. Speaker, I have no additional speakers, but I
continue to reserve the balance of my time.
Mr. TOWNS. I yield back the balance of my time.
Mr. CHAFFETZ. Mr. Speaker, in closing, first let me just thank and
commend my colleague Mr. Towns. This very well might be the final bill
that he will introduce and that will pass this body. He is a good and
decent gentleman. When I came here 4 years ago as a freshman, he was
one of the most gracious and great people to work with. He was the
chairman of our committee. I was a fresh newbie there; yet he helped me
in every way while showing a great deal of respect across the aisle.
I congratulate him on an amazing experience here in the Congress.
This is another example of a good bill that this gentleman is putting
forward. I wish him nothing but the best with the rest of his career
and life and everything else. We need more good people like Mr. Towns
participating in this Congress. So I congratulate him on this bill,
urge the passage of this bill, and thank him for his great work.
Mr. TOWNS. Will the gentleman yield?
Mr. CHAFFETZ. I yield to the gentleman from New York.
Mr. TOWNS. Let me just say, too, that you're right, this is probably
my final bill, and it has been great serving here in this Congress for
30 years. You've taught me a lot, too, and let me just tell you the
latest thing that you taught me.
We were having a hearing with all of these professional football
players in terms of how they performed on the field and regarding
enhancement drugs and all of that. When they turned to you--because we
were saying that you were the only football player on the committee--
you said that you were not a football player but that you were a
kicker. I thought that that was a very interesting comment because I'd
just assumed all of these years that you were a football player since
you set all those records.
I want to thank you so much for your kind words. It has been a
delight to work with you as well.
{time} 0920
Mr. CHAFFETZ. Reclaiming my time, again I commend the gentleman for
this bill and his great career, and I urge passage of this bill.
I yield back the balance of my time.
The SPEAKER pro tempore. The question is on the motion offered by the
gentleman from Utah (Mr. Chaffetz) that the House suspend the rules and
pass the bill, H.R. 4053, as amended.
The question was taken.
The SPEAKER pro tempore. In the opinion of the Chair, two-thirds
being in the affirmative, the ayes have it.
Mr. TOWNS. Mr. Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, further
proceedings on this question will be postponed.
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