[Congressional Record Volume 165, Number 119 (Tuesday, July 16, 2019)]
[Senate]
[Pages S4864-S4870]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
PAYMENT INTEGRITY INFORMATION ACT OF 2019
Mr. THUNE. Madam President, I ask unanimous consent that the Senate
proceed to the immediate consideration of Calendar No. 76, S. 375.
The PRESIDING OFFICER. The clerk will report the bill by title.
The senior assistant legislative clerk read as follows:
A bill (S. 375) to improve efforts to identify and reduce
Governmentwide improper payments, and for other purposes.
There being no objection, the Senate proceeded to consider the bill.
Mr. THUNE. Madam President, I ask unanimous consent that the bill be
considered read a third time and passed and the motion to reconsider be
considered made and laid upon the table.
The PRESIDING OFFICER. Without objection, it is so ordered.
The bill was ordered to be engrossed for a third reading, was read
the third time, and passed, as follows:
S. 375
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 ``Payment Integrity
Information Act of 2019''.
SEC. 2. IMPROPER PAYMENTS.
(a) In General.--Chapter 33 of title 31, United States
Code, is amended by adding at the end the following:
``Subchapter IV--Improper Payments
``Sec. 3351. Definitions
``In this subchapter:
``(1) Annual financial statement.--The term `annual
financial statement' means the annual financial statement
required under section 3515 of this title or similar
provision of law.
``(2) Compliance.--The term `compliance' means that an
executive agency--
``(A) has--
``(i) published improper payments information with the
annual financial statement of the executive agency for the
most recent fiscal year; and
``(ii) posted on the website of the executive agency that
statement and any accompanying materials required under
guidance of the Office of Management and Budget;
``(B) if required, has conducted a program specific risk
assessment for each program or activity that conforms with
the requirements under section 3352(a);
``(C) if required, publishes improper payments estimates
for all programs and activities identified under section
3352(a) in the accompanying materials to the annual financial
statement;
``(D) publishes programmatic corrective action plans
prepared under section 3352(d) that the executive agency may
have in the accompanying materials to the annual financial
statement;
``(E) publishes improper payments reduction targets
established under section 3352(d) that the executive agency
may have in the accompanying materials to the annual
financial statement for each program or activity assessed to
be at risk, and has demonstrated improvements and developed a
plan to meet the reduction targets; and
``(F) has reported an improper payment rate of less than 10
percent for each program and activity for which an estimate
was published under section 3352(c).
``(3) Do not pay initiative.--The term `Do Not Pay
Initiative' means the initiative described in section
3354(b).
``(4) Improper payment.--The term `improper payment'--
``(A) means any payment that should not have been made or
that was made in an incorrect amount, including an
overpayment or underpayment, under a statutory, contractual,
administrative, or other legally applicable requirement; and
``(B) includes--
``(i) any payment to an ineligible recipient;
``(ii) any payment for an ineligible good or service;
``(iii) any duplicate payment;
``(iv) any payment for a good or service not received,
except for those payments where authorized by law; and
``(v) any payment that does not account for credit for
applicable discounts.
``(5) Payment.--The term `payment' means any transfer or
commitment for future transfer of Federal funds such as cash,
securities, loans, loan guarantees, and insurance subsidies
to any non-Federal person or entity or a Federal employee,
that is made by a Federal agency, a Federal contractor, a
Federal grantee, or a governmental or other organization
administering a Federal program or activity.
``(6) Payment for an ineligible good or service.--The term
`payment for an ineligible good or service' includes a
payment for any good or service that is rejected under any
provision of any contract, grant, lease, cooperative
agreement, or other funding mechanism.
``(7) Recovery audit.--The term `recovery audit' means a
recovery audit described in section 3352(i).
``(8) State.--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. 3352. Estimates of improper payments and reports on
actions to reduce improper payments
``(a) Identification of Susceptible Programs and
Activities.--
``(1) In general.--The head of each executive agency shall,
in accordance with guidance prescribed by the Director of the
Office of Management and Budget--
``(A) periodically review all programs and activities that
the head of the executive agency administers; and
``(B) identify all programs and activities with outlays
exceeding the statutory threshold dollar amount described in
paragraph (3)(A)(i) that may be susceptible to significant
improper payments.
``(2) Frequency.--A review under paragraph (1) shall be
performed for each program and activity that the head of an
executive agency administers not less frequently than once
every 3 fiscal years.
``(3) Risk assessments.--
``(A) Definition of significant.--In this paragraph, the
term `significant' means that, in the preceding fiscal year,
the sum of a program or activity's improper payments and
payments whose propriety cannot be determined by the
executive agency due to lacking or insufficient documentation
may have exceeded--
``(i) $10,000,000 of all reported program or activity
payments of the executive agency made during that fiscal year
and 1.5 percent of program outlays; or
``(ii) $100,000,000.
``(B) Scope.--In conducting a review under paragraph (1),
the head of each executive agency shall take into account
those risk factors that are likely to contribute to a
susceptibility to significant improper payments, such as--
``(i) whether the program or activity reviewed is new to
the executive agency;
``(ii) the complexity of the program or activity reviewed;
``(iii) the volume of payments made through the program or
activity reviewed;
``(iv) whether payments or payment eligibility decisions
are made outside of the executive agency, such as by a State
or local government;
``(v) recent major changes in program funding, authorities,
practices, or procedures;
[[Page S4865]]
``(vi) the level, experience, and quality of training for
personnel responsible for making program eligibility
determinations or certifying that payments are accurate;
``(vii) significant deficiencies in the audit report of the
executive agency or other relevant management findings that
might hinder accurate payment certification;
``(viii) similarities to other programs or activities that
have reported improper payment estimates or been deemed
susceptible to significant improper payments;
``(ix) the accuracy and reliability of improper payment
estimates previously reported for the program or activity, or
other indicator of potential susceptibility to improper
payments identified by the Inspector General of the executive
agency, the Government Accountability Office, other audits
performed by or on behalf of the Federal, State, or local
government, disclosures by the executive agency, or any other
means;
``(x) whether the program or activity lacks information or
data systems to confirm eligibility or provide for other
payment integrity needs; and
``(xi) the risk of fraud as assessed by the executive
agency under the Standards for Internal Control in the
Federal Government published by the Government Accountability
Office (commonly known as the `Green Book').
``(C) Annual report.--Each executive agency shall publish
an annual report that includes--
``(i) a listing of each program or activity identified
under paragraph (1), including the date on which the program
or activity was most recently assessed for risk under
paragraph (1); and
``(ii) a listing of any program or activity for which the
executive agency makes any substantial changes to the
methodologies of the reviews conducted under paragraph (1).
``(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 executive agency responsible
for administering a high-priority program identified under
subparagraph (A), establish annual targets and semi-annual or
quarterly actions for reducing improper payments associated
with the 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 executive agency with a
program identified under paragraph (1)(A) shall on an annual
basis submit to the Inspector General of the executive agency
and the Office of Management and Budget, and make available
to the public, including through a website, a report on that
program.
``(B) Contents.--Each report submitted under subparagraph
(A)--
``(i) shall describe any action the executive agency--
``(I) has taken or plans to take to recover improper
payments; and
``(II) intends to take to prevent future improper payments;
and
``(ii) shall not include--
``(I) any referrals the executive agency made or
anticipates making to the Department of Justice; or
``(II) any information provided in connection with a
referral described in subclause (I).
``(C) Public availability on central website.--The Office
of Management and Budget shall make each report submitted
under subparagraph (A) 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 executive agency that submits a report under
subparagraph (A) shall, for each program of the executive
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 executive 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 the appropriate authorizing and
appropriations committees of Congress recommendations, which
may be included in another report submitted by the Inspector
General to Congress, for modifying any plans of the executive
agency relating to the program, including improvements for
improper payments determination and estimation methodology.
``(F) Annual meeting.--Not less frequently than once every
year, the head of each executive agency with a program
identified under paragraph (1)(A), or a designee of the head
of the executive agency, shall meet with the Director of the
Office of Management and Budget, or a designee of the
Director, to report on actions taken during the preceding
year and planned actions to prevent improper payments.
``(c) Estimation of Improper Payments.--
``(1) Estimation.--With respect to each program and
activity identified under subsection (a)(1), the head of the
relevant executive agency shall--
``(A) produce a statistically valid estimate, or an
estimate that is otherwise appropriate using a methodology
approved by the Director of the Office of Management and
Budget, of the improper payments made under the program or
activity; and
``(B) include the estimates described in subparagraph (A)
in the accompanying materials to the annual financial
statement of the executive agency and as required in
applicable guidance of the Office of Management and Budget.
``(2) Lacking or insufficient documentation.--
``(A) In general.--For the purpose of producing an estimate
under paragraph (1), when the executive agency cannot
determine, due to lacking or insufficient documentation,
whether a payment is proper or not, the payment shall be
treated as an improper payment.
``(B) Separate report.--The head of an executive agency may
report separately on what portion of the improper payments
estimate for a program or activity of the executive agency
under paragraph (1) is attributable to lacking or
insufficient documentation.
``(d) Reports on Actions To Reduce Improper Payments.--With
respect to any program or activity of an executive agency
with estimated improper payments under subsection (c), the
head of the executive agency shall provide with the estimate
required under subsection (c) a report on what actions the
executive agency is taking to reduce improper payments,
including--
``(1) a description of the causes of the improper payments,
actions planned or taken to correct those causes, and the
planned or actual completion date of the actions taken to
address those causes;
``(2) in order to reduce improper payments to a level below
which further expenditures to reduce improper payments would
cost more than the amount those expenditures would save in
prevented or recovered improper payments, a statement of
whether the executive agency has what is needed with respect
to--
``(A) internal controls;
``(B) human capital; and
``(C) information systems and other infrastructure;
``(3) if the executive agency does not have sufficient
resources to establish and maintain effective internal
controls as described in paragraph (2)(A), a description of
the resources the executive agency has requested in the
budget submission of the executive agency to establish and
maintain those internal controls;
``(4) program-specific and activity-specific improper
payments reduction targets that have been approved by the
Director of the Office of Management and Budget;
``(5) a description of the steps the executive agency has
taken to ensure that executive agency managers, programs,
and, where appropriate, States and local governments are held
accountable through annual performance appraisal criteria
for--
``(A) meeting applicable improper payments reduction
targets; and
``(B) establishing and maintaining sufficient internal
controls, including an appropriate control environment, that
effectively--
``(i) prevent improper payments from being made; and
``(ii) promptly detect and recover improper payments that
are made; and
``(6) a description of how the level of planned or
completed actions by the executive agency to address the
causes of the improper payments matches the level of improper
payments, including a breakdown by category of improper
payment and specific timelines for completion of those
actions.
``(e) Reports on Actions To Recover Improper Payments.--
With respect to improper payments identified in a recovery
audit, the head of the executive agency shall provide with
the estimate required under subsection (c) a report on all
actions the executive agency is taking to recover the
improper payments, including--
``(1) a discussion of the methods used by the executive
agency to recover improper payments;
``(2) the amounts recovered, outstanding, and determined to
not be collectable, including the percent those amounts
represent of the total improper payments of the executive
agency;
``(3) if a determination has been made that certain
improper payments are not collectable, a justification of
that determination;
``(4) an aging schedule of the amounts outstanding;
``(5) a summary of how recovered amounts have been disposed
of;
``(6) a discussion of any conditions giving rise to
improper payments and how those conditions are being
resolved; and
``(7) if the executive agency has determined under
subsection (i) that performing recovery audits for any
applicable program or activity is not cost-effective, a
justification for that determination.
``(f) Governmentwide Reporting of Improper Payments and
Actions To Recover Improper Payments.--
[[Page S4866]]
``(1) Report.--Each fiscal year, the Director of the Office
of Management and Budget shall submit a report with respect
to the preceding fiscal year on actions that executive
agencies have taken to report information regarding improper
payments and actions to recover improper payments to--
``(A) the Committee on Homeland Security and Governmental
Affairs of the Senate;
``(B) the Committee on Oversight and Reform of the House of
Representatives; and
``(C) the Comptroller General of the United States.
``(2) Contents.--Each report required under paragraph (1)
shall include--
``(A) a summary of the reports of each executive agency on
improper payments and recovery actions submitted under this
section;
``(B) an identification of the compliance status of each
executive agency, as determined by the Inspector General of
the executive agency under section 3353, to which this
section applies;
``(C) Governmentwide improper payment reduction targets;
``(D) a Governmentwide estimate of improper payments; and
``(E) a discussion of progress made towards meeting
Governmentwide improper payment reduction targets.
``(g) Guidance by the Office of Management and Budget.--
``(1) In general.--Not later than 1 year after the date of
enactment of this section, the Director of the Office of
Management and Budget shall prescribe guidance for executive
agencies to implement the requirements of this section, which
shall not include any exemptions to those requirements that
are not specifically authorized by this section.
``(2) Contents.--The guidance under paragraph (1) shall
prescribe--
``(A) the form of the reports on actions to reduce improper
payments, recovery actions, and Governmentwide reporting; and
``(B) strategies for addressing risks and establishing
appropriate prepayment and postpayment internal controls.
``(h) Determinations of Agency Readiness for Opinion on
Internal Control.--The criteria required to be developed
under section 2(g) of the Improper Payments Elimination and
Recovery Act of 2010, as in effect on the day before the date
of enactment of this section--
``(1) shall continue to be in effect on and after the date
of enactment of this section; and
``(2) may be modified as determined appropriate by the
Director of the Office of Management and Budget.
``(i) Recovery Audits.--
``(1) In general.--
``(A) Conduct of audits.--Except as provided under
paragraph (3) and if not prohibited under any other provision
of law, the head of each executive agency shall conduct
recovery audits with respect to each program and activity of
the executive agency that expends $1,000,000 or more annually
if conducting the audits would be cost effective.
``(B) Procedures.--In conducting a recovery audit under
this subsection, the head of an executive agency--
``(i) shall give priority to the most recent payments and
to payments made in any program identified as susceptible to
significant improper payments under subsection (a);
``(ii) shall implement this subsection in a manner designed
to ensure the greatest financial benefit to the Federal
Government; and
``(iii) may conduct the recovery audit directly, by using
other departments and agencies of the United States, or by
procuring performance of recovery audits by private sector
sources by contract, subject to the availability of
appropriations, or by any combination thereof.
``(C) Recovery audit contracts.--With respect to a recovery
audit procured by an executive agency by contract--
``(i) subject to subparagraph (B)(iii), and except to the
extent such actions are outside the authority of the
executive agency under section 7103 of title 41, the head of
the executive agency may authorize the contractor to--
``(I) notify entities, including individuals, of potential
overpayments made to those entities;
``(II) respond to questions concerning potential
overpayments; and
``(III) take other administrative actions with respect to
an overpayment claim made or to be made by the executive
agency; and
``(ii) the contractor shall not have the authority to make
a final determination relating to whether any overpayment
occurred or whether to compromise, settle, or terminate an
overpayment claim.
``(D) Contract terms and conditions.--
``(i) In general.--The executive agency shall include in
each contract for procurement of performance of a recovery
audit a requirement that the contractor shall--
``(I) provide to the executive agency periodic reports on
conditions giving rise to overpayments identified by the
contractor and any recommendations on how to mitigate those
conditions;
``(II) notify the executive agency of any overpayments
identified by the contractor pertaining to the executive
agency or to any other executive agency that are beyond the
scope of the contract; and
``(III) report to the executive agency credible evidence of
fraud or vulnerabilities to fraud and conduct appropriate
training of personnel of the contractor on identification of
fraud.
``(ii) Reports on actions taken.--Each executive agency
shall, on an annual basis, include in annual financial
statement of the executive agency a report on actions taken
by the executive agency during the preceding fiscal year to
address the recommendations described in clause (i)(I).
``(E) Agency action following notification.--Each executive
agency shall--
``(i) take prompt and appropriate action in response to a
report or notification by a contractor under subclause (I) or
(II) of subparagraph (D)(i) to collect an overpayment; and
``(ii) forward to other executive agencies any information
that applies to that executive agency.
``(2) Disposition of amounts recovered.--
``(A) In general.--Amounts collected by executive agencies
each fiscal year through recovery audits shall be treated in
accordance with this paragraph.
``(B) Distribution.--The head of an executive agency shall
determine the distribution of collected amounts described in
subparagraph (A), less amounts needed to fulfill the purposes
of section 3562(a) of this title, in accordance with
subparagraphs (C), (D), and (E).
``(C) Use for financial management improvement program.--
Not more than 25 percent of the amounts collected by an
executive agency through recovery audits--
``(i) shall be available to the head of the executive
agency to carry out the financial management improvement
program of the executive agency under paragraph (3);
``(ii) may be credited, if applicable, for the purpose
described in clause (i) by the head of an executive agency to
any executive agency appropriations and funds that are
available for obligation at the time of collection; and
``(iii) shall be used to supplement and not supplant any
other amounts available for the purpose described in clause
(i) and shall remain available until expended.
``(D) Use for original purpose.--Not more than 25 percent
of the amounts collected by an executive agency through
recovery audits--
``(i) shall be credited to the appropriation or fund, if
any, available for obligation at the time of collection for
the same general purposes as the appropriation or fund from
which the overpayment was made;
``(ii) shall remain available for the same period and
purposes as the appropriation or fund to which credited; and
``(iii) if the appropriation from which an overpayment was
made has expired--
``(I) in the case of recoveries of overpayments that are
made from a trust or special fund account, shall revert to
that account; and
``(II) in the case of other recoveries of overpayments--
``(aa) for amounts that are recovered more than 5 fiscal
years from the last fiscal year in which the funds were
available for obligation, shall be deposited in the Treasury
as miscellaneous receipts; and
``(bb) for other amounts, shall be newly available for the
same time period as the funds were originally available for
obligation.
``(E) Use for inspector general activities.--Not more than
5 percent of the amounts collected by an executive agency
through recovery audits--
``(i) shall be available to the Inspector General of that
executive agency for--
``(I) the Inspector General to carry out this Act; or
``(II) any other activities of the Inspector General
relating to investigating improper payments or auditing
internal controls associated with payments; and
``(ii) shall remain available for the same period and
purposes as the appropriation or fund to which credited.
``(F) Remainder.--Amounts collected that are not applied in
accordance with subparagraph (B), (C), (D), or (E) shall be
deposited in the Treasury as miscellaneous receipts, except
that in the case of recoveries of overpayments that are made
from trust or special fund accounts, those amounts shall
revert to those accounts.
``(G) Discretionary amounts.--This paragraph shall apply
only to recoveries of overpayments that are made from
discretionary appropriations, as defined in section 250(c)(7)
of the Balanced Budget and Emergency Deficit Control Act of
1985 (2 U.S.C. 900(c)(7)), and shall not apply to recoveries
of overpayments that are made from discretionary amounts that
were appropriated before the date of enactment of the
Improper Payments Elimination and Recovery Act of 2010, as in
effect on the day before the date of enactment of this
section.
``(H) Application.--This paragraph shall not apply to the
recovery of an overpayment if the appropriation from which
the overpayment was made has not expired.
``(3) Financial management improvement program.--
``(A) Requirement.--The head of each executive agency shall
conduct a financial management improvement program consistent
with rules prescribed by the Director of the Office of
Management and Budget.
``(B) Program features.--In conducting a program described
in subparagraph (A), the head of an executive agency--
``(i) shall, as the first priority of the program, address
problems that contribute directly to executive agency
improper payments; and
[[Page S4867]]
``(ii) may seek to reduce errors and waste in other
executive agency programs and operations.
``(4) Privacy protections.--Any nongovernmental entity
that, in the course of recovery auditing or recovery activity
under this subsection, obtains information that identifies an
individual or with respect to which there is a reasonable
basis to believe that the information can be used to identify
an individual, may not disclose the information for any
purpose other than the recovery auditing or recovery activity
and governmental oversight of the activity, unless disclosure
for that other purpose is authorized by the individual to the
executive agency that contracted for the performance of the
recovery auditing or recovery activity.
``(5) Rule of construction.--Except as provided under
paragraph (4), nothing in this subsection shall be construed
as terminating or in any way limiting authorities that are
otherwise available to executive agencies under existing
provisions of law to recover improper payments and use
recovered amounts.
``Sec. 3353. Compliance
``(a) Annual Compliance Report by Inspectors General of
Executive Agencies.--
``(1) In general.--Each fiscal year, the Inspector General
of each executive agency shall--
``(A) determine whether the executive agency is in
compliance; and
``(B) submit a report on the determination made under
subparagraph (A) to--
``(i) the head of the executive agency;
``(ii) the Committee on Homeland Security and Governmental
Affairs of the Senate;
``(iii) the Committee on Oversight and Reform of the House
of Representatives; and
``(iv) the Comptroller General of the United States.
``(2) Development or use of a central website.--The Council
of the Inspectors General on Integrity and Efficiency (in
this subsection referred to as the `Council') shall develop a
public central website, or make use of a public central
website in existence on the date of enactment of this
section, to contain individual compliance determination
reports issued by Inspectors General under paragraph (1)(B)
and such additional information as determined by the Council.
``(3) OMB guidance.--Not later than 180 days after the date
of enactment of this section, the Director of the Office of
Management and Budget, in consultation with the Council and
with consideration given to the available resources and
independence of individual Offices of Inspectors General,
shall develop and promulgate guidance for the compliance
determination reports issued by the Inspectors General under
paragraph (1)(B), which shall require that--
``(A) the reporting format used by the Inspectors General
is consistent;
``(B) Inspectors General evaluate and take into account the
adequacy of executive agency risk assessments, improper
payment estimates methodology, and executive agency action
plans to address the causes of improper payments;
``(C) Inspectors General take into account whether the
executive agency has correctly identified the causes of
improper payments and whether the actions of the executive
agency to address those causes are adequate and effective;
``(D) Inspectors General evaluate the adequacy of executive
agency action plans on how the executive agency addresses the
causes of improper payments; and
``(E) as part of the report, Inspectors General include an
evaluation of executive agency efforts to prevent and reduce
improper payments and any recommendations for actions to
further improve that prevention and reduction.
``(4) CIGIE guidance.--Not later than 180 days after the
date of enactment of this section, the Council shall, with
consideration given to the available resources and
independence of individual Offices of Inspectors General,
develop and promulgate guidance that specifies procedures for
compliance determinations made by the Inspectors General
under paragraph (1)(A), which shall describe procedures for
Inspectors General--
``(A) to make the determinations consistent regarding
compliance; and
``(B) to evaluate--
``(i) for compliance with the requirement described in
section 3351(2)(B), the risk assessment methodology of the
executive agency, including whether the audits, examinations,
and legal actions of the Inspector General indicate a higher
risk of improper payments or actual improper payments that
were not included in the risk assessments of the executive
agency conducted under section 3352(a);
``(ii) for compliance with the requirement described in
section 3351(2)(C), the accuracy of the rate estimates and
whether the sampling and estimation plan used is appropriate
given program characteristics;
``(iii) for compliance with the requirement described in
section 3351(2)(D), the corrective action plans and whether
the plans are adequate and focused on the true causes of
improper payments, including whether the corrective action
plans are--
``(I) reducing improper payments;
``(II) effectively implemented; and
``(III) prioritized within the executive agency;
``(iv) the adequacy of executive agency action plans to
address the causes of improper payments;
``(v) executive agency efforts to prevent and reduce
improper payments, and any recommendations for actions to
further improve; and
``(vi) whether an executive agency has published an annual
financial statement in accordance with the requirement
described in section 3351(2)(A).
``(b) Remediation.--
``(1) Noncompliance.--
``(A) In general.--If an executive agency is determined by
the Inspector General of that executive agency not to be in
compliance under subsection (a) in a fiscal year with respect
to a program or activity, the head of the executive agency
shall submit to the appropriate authorizing and
appropriations committees of Congress a plan describing the
actions that the executive agency will take to come into
compliance.
``(B) Plan.--The plan described in subparagraph (A) shall
include--
``(i) measurable milestones to be accomplished in order to
achieve compliance for each program or activity;
``(ii) the designation of a senior executive agency
official who shall be accountable for the progress of the
executive agency in coming into compliance for each program
or activity; and
``(iii) the establishment of an accountability mechanism,
such as a performance agreement, with appropriate incentives
and consequences tied to the success of the official
designated under clause (ii) in leading the efforts of the
executive agency to come into compliance for each program or
activity.
``(2) Noncompliance for 2 fiscal years.--
``(A) In general.--If an executive agency is determined by
the Inspector General of that executive agency not to be in
compliance under subsection (a) for 2 consecutive fiscal
years for the same program or activity, the executive agency
shall propose to the Director of the Office of Management and
Budget additional program integrity proposals that would help
the executive agency come into compliance.
``(B) Additional funding.--
``(i) In general.--If the Director of the Office of
Management and Budget determines that additional funding
would help an executive agency described in subparagraph (A)
come into compliance, the head of the executive agency shall
obligate additional funding, in an amount determined by the
Director, to intensified compliance efforts.
``(ii) Reprogramming or transfer authority.--In providing
additional funding under clause (i)--
``(I) the head of an executive agency shall use any
reprogramming or transfer authority available to the
executive agency; and
``(II) if after exercising the reprogramming or transfer
authority described in subclause (I), additional funding is
necessary to obligate the full level of funding determined by
the Director of the Office of Management and Budget under
clause (i), the executive agency shall submit a request to
Congress for additional reprogramming or transfer authority.
``(3) Reauthorization and statutory proposals.--If an
executive agency is determined by the Inspector General of
that executive agency not to be in compliance under
subsection (a) for 3 consecutive fiscal years for the same
program or activity, the head of the executive agency shall,
not later than 30 days after the date of that determination,
submit to the appropriate authorizing and appropriations
committees of Congress and the Comptroller General of the
United States--
``(A)(i) reauthorization proposals for each program or
activity that has not been in compliance for 3 or more
consecutive fiscal years; and
``(ii) proposed statutory changes necessary to bring the
program or activity into compliance; or
``(B) if the head of the executive agency determines that
clauses (i) and (ii) of subparagraph (A) will not bring the
program or activity into compliance, a description of the
actions that the executive agency is undertaking to bring the
program or activity into compliance and a timeline of when
the compliance will be achieved.
``(4) Plan and timeline for compliance.--If an executive
agency is determined by the Inspector General of that
executive agency not to be in compliance under subsection (a)
for 4 or more consecutive fiscal years for the same program
or activity, the head of the executive agency shall, not
later than 30 days after such determination, submit to the
appropriate authorizing and appropriations committees of
Congress a report that includes--
``(A) the activities taken to comply with the requirements
for 1, 2, 3, 4, or more years of noncompliance;
``(B) a description of any requirements that were fulfilled
for 1, 2, or 3 consecutive years of noncompliance that are
still relevant and being pursued as a means to bring the
program or activity into compliance and prevent and reduce
improper payments;
``(C) a description of any new corrective actions; and
``(D) a timeline for when the program or activity will
achieve compliance based on the actions described within the
report.
``(5) Annual report.--Each executive agency shall submit to
the appropriate authorizing and appropriations committees of
Congress and the Comptroller General of the United States--
[[Page S4868]]
``(A) a list of each program or activity that was
determined to not be in compliance under paragraph (1), (2),
(3), or (4); and
``(B) actions that are planned to bring the program or
activity into compliance.
``(c) Compliance Enforcement Pilot Programs.--The Director
of the Office of Management and Budget may establish 1 or
more pilot programs that shall test potential accountability
mechanisms with appropriate incentives and consequences tied
to success in ensuring compliance with this section and
eliminating improper payments.
``(d) Improved Estimates Guidance.--The guidance required
to be provided under section 3(b) of the Improper Payments
Elimination and Recovery Improvement Act of 2012, as in
effect on the day before the date of enactment of this
section--
``(1) shall continue to be in effect on and after the date
of enactment of this section; and
``(2) may be modified as determined appropriate by the
Director of the Office of Management and Budget.
``Sec. 3354. Do Not Pay Initiative
``(a) Prepayment and Preaward Procedures.--
``(1) In general.--Each executive 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 or award, each executive agency shall review as
appropriate the following databases to verify eligibility of
the payment and award:
``(A) The death records maintained by the Commissioner of
Social Security.
``(B) The System for Award Management Exclusion Records,
formerly known as the Excluded Parties List System, of the
General Services Administration.
``(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.
``(F) Information regarding incarcerated individuals
maintained by the Commissioner of Social Security under
sections 202(x) and 1611(e) of the Social Security Act (42
U.S.C. 402(x), 1382(e)).
``(b) Do Not Pay Initiative.--
``(1) In general.--There is the Do Not Pay Initiative,
which shall include--
``(A) use of the databases described in subsection (a)(2);
and
``(B) use of other databases designated by the Director of
the Office of Management and Budget, or the designee of the
Director, in consultation with executive 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, or the head of any executive agency
designated by the Director, 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.--
``(A) In general.--For purposes of identifying and
preventing improper payments, each executive agency shall
have access to, and use of, the Do Not Pay Initiative to
verify payment or award eligibility in accordance with
subsection (a).
``(B) Matching programs.--
``(i) In general.--The head of the agency operating the
Working System may, in consultation with the Office of
Management and Budget, waive the requirements of section
552a(o) of title 5 in any case or class of cases for computer
matching activities conducted under this section.
``(ii) Guidance.--The Director of the Office of Management
and Budget may issue guidance that establishes requirements
governing waivers under clause (i).
``(C) Other entities.--Each State and any contractor,
subcontractor, or agent of a State, including a State auditor
or State program responsible for reducing improper payments
of a federally funded State-administered program, and the
judicial and legislative branches of the United States, as
defined in paragraphs (2) and (3), respectively, of section
202(e) of title 18, shall have access to, and use of, the Do
Not Pay Initiative for the purpose of verifying payment or
award eligibility for payments.
``(D) Consistency with privacy act of 1974.--To ensure
consistency with the principles of section 552a of title 5
(commonly known as the `Privacy Act of 1974'), the Director
of the Office of Management and Budget may issue guidance
that establishes privacy and other requirements that shall be
incorporated into Do Not Pay Initiative access agreements
with States, including any contractor, subcontractor, or
agent of a State, and the judicial and legislative branches
of the United States, as defined in paragraphs (2) and (3),
respectively, of section 202(e) of title 18.
``(4) Payment otherwise required.--When using the Do Not
Pay Initiative, an executive 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) Initial Working System.--The working system required
to be established under section 5(d) of the Improper Payments
Elimination and Recovery Improvement Act of 2012, as in
effect on the day before the date of enactment of this
section--
``(1) shall continue to be in effect on and after the date
of enactment of this section; and
``(2) shall require each executive agency to review all
payments and awards for all programs and activities of that
executive agency through the working system.
``(d) Facilitating Data Access by Federal Agencies and
Offices of Inspectors General for Purposes of Program
Integrity.--
``(1) Computer matching by executive 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 (commonly known as
the `Privacy Act of 1974'), the head of each executive agency
may enter into computer matching agreements with other heads
of executive agencies 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 the date on
which a proposal for an agreement under subparagraph (A) has
been presented to a Data Integrity Board established under
section 552a(u) of title 5 for consideration, the Data
Integrity Board shall respond to the proposal.
``(C) Termination date.--An agreement described in
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 executive agencies entering the agreement for not more
than 3 years.
``(D) Multiple agencies.--For purposes of this paragraph,
section 552a(o)(1) of title 5 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 relating to an agreement under
subparagraph (A) is not required to contain a specific
estimate of any savings under the computer matching
agreement.
``(2) Guidance and procedures by the office of management
and budget.--The guidance, rules, and procedures required to
be issued, clarified, and established under paragraphs (3)
and (4) of section 5(e) of the Improper Payments Elimination
and Recovery Improvement Act of 2012, as in effect on the day
before the date of enactment of this section--
``(A) shall continue to be in effect on and after the date
of enactment of this section; and
``(B) may be modified as determined appropriate by the
Director of the Office of Management and Budget.
``(3) Compliance.--The head of each executive agency, in
consultation with the Inspector General of the executive
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.
``(4) Rule of construction.--Nothing in this subsection
shall be construed--
``(A) to affect the rights of an individual under section
552a(p) of title 5; or
``(B) to impede the exercise of an exemption provided to
Inspectors General or by an executive agency in coordination
with an Inspector General under section 6(j) of the Inspector
General Act of 1978 (5 U.S.C. App.).
``(e) 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 and Other Death Data.--
``(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 each State, the Director of the
Office of Management and Budget shall conduct a study and
update the plan required to be established under section 5(g)
of the Improper Payments Elimination and Recovery Improvement
Act of 2012, as in effect on the day before the date of
enactment of this section, for improving the quality,
accuracy, and timeliness of death data maintained by the
Social Security Administration, including death information
reported
[[Page S4869]]
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 described in
this subsection shall include recommended actions by
executive 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 executive agencies for
determining ineligible payments due to the death of a
recipient through proactive verification means; and
``(E) address improper payments made by executive agencies
to deceased individuals as part of Federal retirement
programs.
``(3) Report.--Not later than 120 days after the date of
enactment of this section, the Director of the Office of
Management and Budget shall submit a report to Congress on
the plan described in this subsection, including recommended
legislation.
``Sec. 3355. Improving recovery of improper payments
``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 executive 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.
``Sec. 3356. Improving the use of data by executive agencies
for curbing improper payments
``(a) Prompt Reporting of Death Information by the
Department of State and the Department of Defense.--The
procedure required to be established under section 7(a) of
the Improper Payments Elimination and Recovery Improvement
Act of 2012, as in effect on the day before the date of
enactment of this section--
``(1) shall continue to be in effect on and after the date
of enactment of this section; and
``(2) may be modified as determined appropriate by the
Director of the Office of Management and Budget.
``(b) Prompt Reporting of Death Information by the
Department of Veterans Affairs and the Office of Personnel
Management.--Not later than 1 year after the date of
enactment of this section, the Secretary of Veterans Affairs
and the Director of the Office of Personnel Management shall
establish a procedure under which the Secretary and the
Director--
``(1) shall promptly and on a regular basis submit
information relating to the deaths of individuals, including
stopped payments data as applicable, to each executive agency
for which the Director of the Office of Management and Budget
determines receiving and using such information would be
relevant and necessary; and
``(2) to facilitate the centralized access of death data
for the use of reducing improper payments, may identify
additional Federal sources of death data and direct the data
owner to provide that data to 1 or more executive agencies
for that purpose.
``(c) Guidance to Executive Agencies Regarding Data Access
and Use for Improper Payments Purposes.--The guidance
required to be issued under section 7(b) of the Improper
Payments Elimination and Recovery Improvement Act of 2012, as
in effect on the day before the date of enactment of this
section--
``(1) shall continue to be in effect on and after the date
of enactment of this section; and
``(2) may be modified as determined appropriate by the
Director of the Office of Management and Budget.
``Sec. 3357. Financial and administrative controls relating
to fraud and improper payments
``(a) Definition.--In this section, the term `agency' has
the meaning given the term in section 551 of title 5.
``(b) Guidelines.--The guidelines required to be
established under section 3(a) of the Fraud Reduction and
Data Analytics Act of 2015, as in effect on the day before
the date of enactment of this section--
``(1) shall continue to be in effect on and after the date
of enactment of this section; and
``(2) may be periodically modified by the Director of the
Office of Management and Budget, in consultation with the
Comptroller General of the United States, as the Director and
Comptroller General may determine necessary.
``(c) Requirements for Controls.--The guidelines described
in subsection (b) shall include--
``(1) conducting an evaluation of fraud risks and using a
risk-based approach to design and implement financial and
administrative control activities to mitigate identified
fraud risks;
``(2) collecting and analyzing data from reporting
mechanisms on detected fraud to monitor fraud trends and
using that data and information to continuously improve fraud
prevention controls; and
``(3) using the results of monitoring, evaluation, audits,
and investigations to improve fraud prevention, detection,
and response.
``(d) Report.--For each of fiscal years 2019 and 2020, each
agency shall submit to Congress, as part of the annual
financial report of the agency, a report of the agency on--
``(1) implementing--
``(A) the financial and administrative controls described
in subsection (b);
``(B) the fraud risk principle in the Standards for
Internal Control in the Federal Government published by the
Government Accountability Office (commonly known as the
`Green Book'); and
``(C) Office of Management and Budget Circular A-123, or
any successor thereto, with respect to the leading practices
for managing fraud risk;
``(2) identifying risks and vulnerabilities to fraud,
including with respect to payroll, beneficiary payments,
grants, large contracts, and purchase and travel cards; and
``(3) establishing strategies, procedures, and other steps
to curb fraud.
``Sec. 3358. Interagency working group for Governmentwide
payment integrity improvement
``(a) Working Group.--
``(1) Establishment.--Not later than 90 days after the date
of enactment of this section, there is established an
interagency working group on payment integrity--
``(A) to improve--
``(i) State-administered Federal programs to determine
eligibility processes and data sharing practices;
``(ii) the guidelines described in section 3357(b) and
other best practices and techniques for detecting,
preventing, and responding to improper payments, including
improper payments that are the result of fraud; and
``(iii) the sharing and development of data analytics
techniques to help prevent and identify potential improper
payments, including those that are the result of fraud; and
``(B) to identify any additional activities that will
improve payment integrity of Federal programs.
``(2) Composition.--The interagency working group
established under paragraph (1) shall be composed of--
``(A) the Director of the Office of Management and Budget;
``(B) 1 representative from each of the agencies described
in paragraphs (1) and (2) of section 901(b) of this title;
and
``(C) any other representatives of other executive agencies
determined appropriate by the Director of the Office of
Management and Budget, which may include the Chief
Information Officer, the Chief Procurement Officer, the Chief
Risk Officer, or the Chief Operating Officer of an executive
agency.
``(b) Consultation.--The working group established under
subsection (a)(1) may consult with Offices of Inspectors
General and Federal and non-Federal experts on fraud risk
assessments, administrative controls over payment integrity,
financial controls, and other relevant matters.
``(c) Meetings.--The working group established under
subsection (a)(1) shall hold not fewer than 4 meetings per
year.
``(d) Report.--Not later than 240 days after the date of
enactment of this section, the working group established
under subsection (a)(1) shall submit to Congress a report
that includes--
``(1) a plan containing tangible solutions to prevent and
reduce improper payments; and
``(2) a plan for State agencies to work with Federal
agencies to regularly review lists of beneficiaries of State-
managed Federal programs for duplicate enrollment between
States, including how the Do Not Pay Business Center and the
data analytics initiative of the Department of the Treasury
could aid in the detection of duplicate enrollment.''.
(b) Technical and Conforming Amendment.--The table of
sections for chapter 33 of title 31, United States Code, is
amended by adding at the end the following:
``subchapter iv--improper payments
``3351. Definitions.
``3352. Estimates of improper payments and reports on actions to reduce
improper payments.
``3353. Compliance.
``3354. Do Not Pay Initiative.
``3355. Improving recovery of improper payments.
``3356. Improving the use of data by executive agencies for curbing
improper payments.
``3357. Financial and administrative controls relating to fraud and
improper payments.
``3358. Interagency working group for Governmentwide payment integrity
improvement.''.
SEC. 3. REPEALS.
(a) In General.--
(1) Improper payments information act of 2002.--The
Improper Payments Information Act of 2002 (31 U.S.C. 3321
note) is repealed.
(2) Improper payments elimination and recovery act of
2010.--The Improper Payments Elimination and Recovery Act of
2010 (Public Law 114-204; 124 Stat. 2224) is repealed.
(3) Improper payments elimination and recovery improvement
act of 2012.--The Improper Payments Elimination and Recovery
Improvement Act of 2012 (31 U.S.C. 3321 note) is repealed.
(4) Fraud reduction and data analytics act of 2015.--The
Fraud Reduction and Data
[[Page S4870]]
Analytics Act of 2015 (31 U.S.C. 3321 note) is repealed.
(b) Technical and Conforming Amendments.--
(1) Government charge card abuse prevention act of 2012.--
Section 6(a) of the Government Charge Card Abuse Prevention
Act of 2012 (5 U.S.C. 5701 note) is amended by striking
``section 3512 of title 31, United States Code, or in the
Improper Payments Information Act of 2002 (31 U.S.C. 3321
note)'' and inserting ``section 3512 or subchapter IV of
chapter 33 of title 31, United States Code''.
(2) Homeland security act of 2002.--Section 2022(a) of the
Homeland Security Act of 2002 (6 U.S.C. 612(a)) is amended--
(A) in paragraph (1)(C), by striking ``Consistent with the
Improper Payments Information Act of 2002 (31 U.S.C. 3321
note)'' and inserting ``Consistent with subchapter IV of
chapter 33 of title 31, United States Code''; and
(B) in paragraph (5), by striking ``section 2(h) of the
Improper Payments Elimination and Recovery Act of 2010 (31
U.S.C. 3321 note)'' and inserting ``section 3352(i) of title
31, United States Code,''.
(3) Social security act.--Section 2105 of the Social
Security Act (42 U.S.C. 1397ee(c)) is amended by striking
``Improper Payments Information Act of 2002'' each place that
term appears and inserting ``subchapter IV of chapter 33 of
title 31, United States Code''.
(4) Title 31.--Section 3562(a) of title 31, United States
Code, is amended--
(A) in the matter preceding paragraph (1)--
(i) by striking ``section 3561'' and inserting ``section
3352(i)''; and
(ii) by striking ``agency for the following purposes:'' and
all that follows through ``To reimburse'' and inserting
``agency to reimburse''; and
(B) by striking paragraph (2).
____________________