Year 2000 Computing Challenge: Readiness of Key State-Administered
Federal Programs (Testimony, 10/06/1999, GAO/T-AIMD-00-9).
Pursuant to a congressional request, GAO discussed the year 2000
readiness of state-administered federal programs, focusing on: (1) the
reported year 2000 readiness of 10 key state-administered federal human
services programs; and (2) federal activities to assess states'
readiness for these 10 programs.
GAO noted that: (1) much work remains at the state level to ensure that
major services are not disrupted; (2) at particular risk are several
states with systems that are not yet year 2000 compliant; (3) in
addition, federal agency reviews of business continuity and contingency
plans for state-administered federal programs indicate that many are
inadequate; (4) federal agencies are working with their state partners
to obtain readiness information and evaluate and provide assistance in
key activities such as business continuity and contingency planning; (5)
nevertheless, some state completion dates are so close to the turn of
the century that the risk of disruption to their programs is
substantially increased, especially if schedule delays or unexpected
problems arise; and (6) this is especially troublesome considering the
amount of work remaining in developing effective business continuity and
contingency plans.
--------------------------- Indexing Terms -----------------------------
REPORTNUM: T-AIMD-00-9
TITLE: Year 2000 Computing Challenge: Readiness of Key
State-Administered Federal Programs
DATE: 10/06/1999
SUBJECT: Federal/state relations
Computer software verification and validation
Systems conversions
Computer software
Strategic information systems planning
Management information systems
State-administered programs
Y2K
IDENTIFIER: Y2K
Medicaid Program
Food Stamp Program
Special Supplemental Food Program for Women, Infants, and
Children
WIC
HHS Child Support Enforcement Program
HHS Child Welfare Services Program
HHS Low Income Home Energy Assistance Program
HHS Temporary Assistance for Needy Families Program
Unemployment Insurance Program
HHS Child Nutrition Program
HHS Child Care Program
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Before the Subcommittee on Government Management, Information and
Technology, Committee on Government Reform, and the Subcommittee on
Technology, Committee on Science, House of Representatives
For Release on Delivery
Expected at
10 a.m.
Wednesday,
October 6, 1999
YEAR 2000 COMPUTING CHALLENGE
Readiness of Key State-Administered Federal Programs
Statement of Joel C. Willemssen
Director, Civil Agencies Information Systems
Accounting and Information Management Division
*****************
*****************
GAO/T-AIMD-00-9
Mr. Chairman, Ms. Chairwoman, and Members of the Subcommittees:
Thank you for inviting us to participate in today's hearing on the Year
2000 readiness of state-administered federal programs. These programs
include critical federal human services functions such as Food Stamps and
Medicaid. As we reported in November 1998, many systems that support state-
administered federal human services programs were at risk from the Year
2000 challenge and much work remained to ensure that services would
continue./Footnote1/ In February of this year, we testified that while
some progress had been achieved, many states' systems were not scheduled
to become Year 2000 compliant until the last half of 1999./Footnote2/ This
past summer, we testified that although federal agencies were working with
their state partners to obtain readiness information and provide
assistance, much work remained at the state level to ensure that major
services were not disrupted./Footnote3/
As requested, after a brief background discussion, today I will (1)
highlight the reported Year 2000 readiness of 10 key state-administered
federal human services programs and (2) discuss federal activities to
assess states' readiness for these 10 programs.
Background
In March 1999, the Office of Management and Budget (OMB) designated
42 programs as high impact (later adding a 43rd) and designated lead
agencies for each. OMB reported that it designated those programs that, if
disrupted, could have a direct effect on the public's health and safety or
the well-being of individuals.
Almost one quarter of the programs on OMB's high-impact list are
administered by the states. These programs provide essential benefits,
such as food stamps and unemployment benefits, to millions of people.
Table 1 lists these 10 high-impact state-administered federal human
services programs and the lead federal agency responsible for
each./Footnote4/
Table****Helvetica:x11****1: State-Administered Federal Human Services
Programs
-----------------------------------------------------------------------
| Lead federal agency : Program |
|---------------------------------------------------------------------|
| Department of Agriculture : Child Nutrition programs |
|---------------------------------------------------------------------|
| : Food Stamps |
|---------------------------------------------------------------------|
| : Special Supplemental Nutrition |
| : Program for Women, Infants, and |
| : Children |
|---------------------------------------------------------------------|
| Department of Health and : Child Care |
| Human Services (HHS) : |
|---------------------------------------------------------------------|
| : Child Support Enforcement |
|---------------------------------------------------------------------|
| : Child Welfare |
|---------------------------------------------------------------------|
| : Low Income Home Energy Assistance |
| : Program |
|---------------------------------------------------------------------|
| : Medicaid |
|---------------------------------------------------------------------|
| : Temporary Assistance for Needy Families |
|---------------------------------------------------------------------|
| Department of Labor : Unemployment Insurance |
-----------------------------------------------------------------------
Source: OMB.
For each high-impact program, the lead federal agency was charged with
identifying to OMB the partners integral to program delivery; taking a
leadership role in convening those partners; assuring that each partner
had an adequate Year 2000 plan and, if not, helping each partner without
one; and developing a plan to ensure that the program would operate
effectively. According to OMB, such a plan might include testing data
exchanges across partners, developing complementary business continuity
and contingency plans, sharing key information on readiness with other
partners and the public, and taking other steps necessary to ensure that
the program would work. OMB directed the lead agencies to provide a
schedule and milestones of key activities in the plan by April 15, 1999;
it also asked agencies to provide monthly progress reports.
OMB also directed federal oversight agencies to include the status of
selected state human services systems in their quarterly Year 2000
progress reports. Specifically, OMB asked that agencies report the date
when each state's systems would be Year 2000 compliant. Further, it
requested that federal agencies describe their planned actions to help
ensure that these programs would be able to provide services and benefits.
Some State Programs Reported as Already Compliant; Others May Not Be Until
Late 1999
Table 2 summarizes the latest information on state-administered federal
human services programs reported by OMB on September 13, 1999./Footnote5/
The table indicates that while many states/Footnote6/ reported their
programs to be compliant, a number did not plan to complete Year 2000
efforts until the last quarter of 1999. For example, nine states did not
expect to be compliant until the last quarter of 1999 for Child Support
Enforcement, seven states for Food Stamps, and four states for
Unemployment Insurance. Moreover, Year 2000 readiness information was
unknown in many cases. For example, according to OMB, the status of 16
states' Low Income Home Energy Assistance programs was unknown because
applicable readiness information was not available.
Table****Helvetica:x11****2: Reported State-level Readiness for
Federally Supported Programs
from Previous Page
-----------------------------------------------------------------------------
| : : : Expected date of 1999 : : |
| : : : compliance : : |
|---------------------------------------------------------------------------|
| Program : Complia : Est. : Aug.: Sep : Oct.: Nov.: Dec.: Unk : N/Ad |
| : nta : complian : : t. : : : : .c : |
| : : ce date : : : : : : : |
| : : before : : : : : : : |
| : : Aug. : : : : : : : |
| : : 1999b : : : : : : : |
|---------------------------------------------------------------------------|
| Child : 41 : 1 : 4 : 4 : 2 : 0 : 2 : 0 : 0 |
| Nutrition : : : : : : : : : |
|---------------------------------------------------------------------------|
| Food : 39 : 0 : 3 : 5 : 3 : 4 : 0 : 0 : 0 |
| Stamps : : : : : : : : : |
|---------------------------------------------------------------------------|
| Women, : 45 : 0 : 0 : 2 : 3 : 3 : 1 : 0 : 0 |
| Infants, : : : : : : : : : |
| and : : : : : : : : : |
| Children : : : : : : : : : |
|---------------------------------------------------------------------------|
| Child Care: 25 : 12 : 0 : 2 : 2 : 3 : 0 : 6 : 4 |
|---------------------------------------------------------------------------|
| Child : 23 : 9 : 2 : 7 : 4 : 3 : 2 : 4 : 0 |
| Support : : : : : : : : : |
| Enforceme : : : : : : : : : |
| nt : : : : : : : : : |
|---------------------------------------------------------------------------|
| Child : 23 : 14 : 1 : 3 : 5 : 3 : 0 : 5 : 0 |
| Welfare : : : : : : : : : |
|---------------------------------------------------------------------------|
| Low : 25 : 2 : 3 : 3 : 2 : 0 : 0 : 16 : 3 |
| Income : : : : : : : : : |
| Home : : : : : : : : : |
| Energy : : : : : : : : : |
| Assistanc : : : : : : : : : |
| e Program : : : : : : : : : |
|---------------------------------------------------------------------------|
| Medicaid : 25 : 18 : 0 : 5 : 4 : 0 : 0 : 2 : 0 |
| - : : : : : : : : : |
| Integrate : : : : : : : : : |
| d : : : : : : : : : |
| Eligibili : : : : : : : : : |
| ty System : : : : : : : : : |
|---------------------------------------------------------------------------|
| Medicaid : 22 : 16 : 5 : 4 : 4 : 1 : 0 : 2 : 0 |
| - : : : : : : : : : |
| Managemen : : : : : : : : : |
| t : : : : : : : : : |
| Informati : : : : : : : : : |
| on System : : : : : : : : : |
|---------------------------------------------------------------------------|
| Temporary : 27 : 15 : 2 : 4 : 2 : 1 : 0 : 3 : 0 |
| : : : : : : : : : |
| Assistanc : : : : : : : : : |
| e for : : : : : : : : : |
| Needy : : : : : : : : : |
| Families : : : : : : : : : |
|---------------------------------------------------------------------------|
| Unemploym : 39 : 0 : 0 : 10 : 3 : 0 : 1 : 0 : 1 |
| ent : : : : : : : : : |
| Insurance : : : : : : : : : |
-----------------------------------------------------------------------------
Note: This chart contains readiness information from the 50 states, the
District of Columbia, Guam, Puerto Rico, and the Virgin Islands.
aOMB defined compliant as when the state or territory had determined that
its systems were able to provide services, whether directly or indirectly,
to beneficiaries.
bIn many cases, the report indicated a date instead of whether the state
was compliant. According to OMB, in some cases, while the estimated dates
had passed, confirmation of completion had not been received from the
federal agencies.
cUnk. indicates that, according to OMB, no information was reported by the
agency.
dN/A indicates that the states or territories reported that the data
requested were not applicable to them.
Source: Progress on Year 2000 Conversion: 10th Quarterly Report (OMB, data
received August 13, 1999; report issued September 13, 1999).
The information in the OMB report was gathered, but not verified, by the
Departments of Agriculture, HHS, and Labor based on submissions by the
states and territories. As a result, some of the state information
reported by OMB may not be accurate or up-to-date. For example, in five
cases, state programs cited as compliant by OMB in its June quarterly
report had estimated compliance dates of October 1999 or later in its
September quarterly report.
Further, the late reported compliance dates of some states are problematic
since schedule delays or unexpected problems could well arise. Indeed,
reported schedule delays have now occurred in 8 of the 10 state-
administered programs since OMB's June 1999 report./Footnote7/ For
example, OMB's June report showed that three states had estimated
compliance dates in the last quarter of 1999 for Food Stamps, while the
most recent OMB report indicates that seven states now have estimated
fourth quarter compliance dates. To illustrate, the June OMB report
indicated that a state and a territory were due to be compliant in June
for Food Stamps but the September OMB report indicated that the date for
these entities had moved to November 1999.
Assessments of State-Administered Human Services Programs Are Ongoing
In addition to obtaining state-reported readiness status information, the
three federal departments are taking other actions to assess the ability
of state-administered programs to continue operating successfully into the
next century. However, the approaches of the three departments in
assessing the readiness of state-administered federal human services
programs vary significantly. For example, HHS' Health Care Financing
Administration (HCFA) obtained a contractor to perform comprehensive on-
site reviews in all states, using a standard methodology. Agriculture's
Food and Nutrition Service's (FNS) approach includes actions such as
having regional offices monitor state Year 2000 efforts and obtaining
state certifications of compliance. The Department of Labor is relying on
its regional offices to monitor state Year 2000 activities as well as
requiring states to obtain and submit independent verification and
validation reports after declaring their systems compliant. I will now
briefly describe some of the specific actions that the Departments of
Agriculture, HHS, and Labor have taken and/or plan to take.
Department of Agriculture
-------------------------
Agriculture's FNS is responsible for three state-administered federal
human services programs-Child Nutrition; Food Stamps; and Women, Infants,
and Children. This past week we reported that FNS has taken action and
made progress in ensuring Year 2000 readiness of these
programs./Footnote8/ However, FNS had a long way to go with the limited
time remaining to fully meet its high-impact program responsibilities. We
continue to perform work in this area for the House Committee on
Agriculture, Subcommittee on Department Operations, Oversight, Nutrition,
and Forestry.
To obtain assurance that state systems are compliant, FNS' regional
offices are collecting readiness status information from states as part of
their monitoring. Moreover, in June 1999, FNS required its regions to
provide, for each program, a copy of either a state letter certifying that
it was Year 2000 compliant or a business continuity and contingency plan.
As of August 25, 1999, FNS had received
o 15 certifications and 6 business continuity and contingency plans for
Child Nutrition;
o 22 certifications and 16 business continuity and contingency plans for
Food Stamps; and
o 25 certifications and 21 business continuity and contingency plans for
Women, Infants, and Children.
The number of certifications provided to FNS/Footnote9/ is significantly
lower than the number of compliant state-level programs indicated in OMB's
latest quarterly report (see table 2)-41 states for Child Nutrition; 39
for Food Stamps; and 45 for Women, Infants, and Children.
Business continuity and contingency plans are essential to respond to two
types of failures: those that can be predicted (e.g., systems renovations
that are behind schedule) and those that are unforeseen (e.g., systems
that fails despite having been certified as Year 2000 compliant).
Therefore, it is important for organizations to have such plans,
regardless of the readiness status of their systems.
Although agency officials instructed FNS regional offices to require state
agencies for all three programs to prepare business continuity and
contingency plans, it remains unclear whether all states have adequate
plans to ensure the continuity of these programs. For example, a
June 18 FNS document summarizing the agency's review of contingency plans
received to date noted that "all need work." It appears that little
progress has been made since then because, as of September 15, FNS
officials told us that only two states had submitted suitable contingency
plans. In addition, FNS has not established milestones for when states
should complete business continuity and contingency plans. Our September
report/Footnote10/ recommended that such milestones be established. USDA
and FNS agreed with this recommendation and said they planned to take
steps to implement it.
To help states with their Year 2000 efforts, FNS obtained a contractor to
conduct on-site visits to certain states and territories. Between May 1999
and September 1999, this contractor visited 21 states and territories-for
one or more state-administered programs-in which (1) the state had
estimated it would not be compliant until the last quarter of the year,
(2) the state had reported little or no progress to date, and/or (3) an
FNS regional office requested that the state be visited. These visits were
principally intended to provide technical assistance to the states in
areas such as Year 2000 project management, hardware and software testing,
and contingency planning. FNS headquarter officials told us that while
they have not required their regional offices to follow up with states in
those cases in which the contractor had recommendations for improvement,
the regional offices were doing so in some cases. As a next step, FNS
plans to have its contractor review contingency plans at those states that
reported that they expect to be compliant after September 30, 1999.
Department of Health and Human Services
---------------------------------------
Six of the 10 state-administered federal human services programs are
overseen by either one of two HHS component entities, HCFA or the
Administration for Children and Families (ACF). HCFA has adopted an
approach that includes three rounds of on-site contractor reviews of
states (performed in conjunction with HCFA regional and headquarters
offices) using a standard methodology. Yesterday, we issued correspondence
to the Senate Committee on Finance on the results of our Medicaid work, as
summarized below./Footnote11/
Between November 1998 and April 1999, the HCFA contractor completed the
initial round of on-site reviews in all 50 states and the District of
Columbia. These reviews included assessments of states' integrated
eligibility systems and Medicaid management information systems (MMIS) in
areas such as project management and planning, remediation progress,
testing, and contingency planning. After completing the on-site review,
the contractor (1) identified barriers to successful remediation, (2) made
recommendations to address specific areas of concern, and (3) placed
Medicaid integrated eligibility and management information systems into
low, medium, or high risk categories based on the quality and completeness
of project management/planning, progress in remediation, quality
management, testing, and contingency planning.
Since May 1999, HCFA's contractor has (again, along with officials from
HCFA regional and headquarters offices) conducted a second round of on-
site reviews in 40 states-primarily those in which at least one system was
categorized as a high or medium risk during the initial visit. As in the
first round, the state systems were placed in low, medium, or high risk
categories. A system's risk level was determined based on the resolution
of critical issues previously identified, progress in remediation,
testing, and senior management support. During this round, HCFA's
contractor also conducted follow-up telephone calls to four states not
visited.
With respect to the risk levels assigned to the states, as of October 4,
1999,
o 4 eligibility systems and 5 MMISs were assessed at high risk,
o 13 eligibility systems and 8 MMISs were assessed at medium risk, and
o 36 eligibility systems and 40 MMISs were assessed at low
risk./Footnote12/
These risk ratings indicate that information in the latest OMB quarterly
report may have overstated the compliance status of some states. For
example, a program cited as compliant in two states (see table 2) was
considered to be at high risk by HCFA.
HCFA's current state risk ratings represent an overall improvement from
those assigned after the first round of reviews. Nevertheless, many issues
continue to be unresolved at the states. For example, based on final and
draft reports for the eligibility systems and MMISs for 37 states, the
District of Columbia, and two territories and completed follow-up
telephone calls to 3 states, (1) 43 testing issues were open, (2) 37
project management or planning issues were open, and (3) 24 contingency
planning issues were open./Footnote13/
HCFA's third and final round of contractor visits began during the last
week of September. While HCFA had not finalized its list of states to
visit as of September 28, 1999, HCFA officials told us that all states
will either be visited or undergo follow-up telephone calls.
To complement its system reviews, HCFA obtained another contractor to
review state business continuity and contingency plans. In June 1999,
HCFA's business continuity and contingency plan contractor began reviewing
the quality of state plans through either a desk audit alone or both a
desk audit and an on-site visit. After the contractor's review, each
state's plan was placed into a high, medium, or low risk category based on
the contractor's evaluation of the state's development process and the
quality and completeness of its plan. Of the 33 states and two territories
that have been reviewed by the business continuity and contingency plan
contractor as of October 1, 1999,/Footnote14/ 11 were high risk, 11 were
medium risk, and 13 were low risk. In addition, many states were reported
to have open issues in essential areas. For example, 9 states had
insufficient detail in their plans, 7 states lacked management oversight,
and 4 states did not intend to test their plans./Footnote15/
Regarding the other five HHS state-administered federal programs, ACF
modeled its state assessment program after that of HCFA. However, because
ACF began its Year 2000 review of state programs several months later than
HCFA, it is not as far along in its assessment of each state's ability to
continue the operation of these programs into the next century. As of
September 27, 1999, an ACF contractor had conducted on-site reviews of 50
states, three territories, and the District of Columbia. These reviews,
performed with the participation of ACF regional offices, encompassed
areas such as project management, business risk assessment, interfaces,
testing, and the business continuity and contingency planning process.
While ACF and its contractor have completed an initial round of site
visits, the agency has only issued one final report and has provided draft
reports to another 18 states even though some states were visited many
weeks ago. For example, as of September 27, 1999, ACF had not provided
draft reports to five states in which the visits had been completed in June.
The delays in issuing reports restrict the value of the contractor's state
visits. For example, because draft reports may not be sent to states for
months after on-site visits, the information in the reports may no longer
be current. Further, the recommendations in the reports to improve the
states' Year 2000 program may no longer be useful, applicable, or feasible.
With respect to the 19 reports that have been provided to the states as of
September 27, 1999, table 3 breaks out the number of states placed in each
risk assessment level.
Table****Helvetica:x11****3: Summary of Risk Levels as of September 27,
1999
-------------------------------------------------------------------------
| : : Risk levels |
|-----------------------------------------------------------------------|
| Program : Number of : High : Medium : Low |
| : state : : : |
| : reports : : : |
|-----------------------------------------------------------------------|
| ACF - Child Care : 19 : 1 : 9 : 9 |
|-----------------------------------------------------------------------|
| ACF - Child Support Enforcement : 19 : 3 : 6 : 10 |
|-----------------------------------------------------------------------|
| ACF - Child Welfarea : 18 : 0 : 8 : 10 |
|-----------------------------------------------------------------------|
| ACF - Low Income Home Energy : 19 : 0 : 7 : 12 |
| Assistance Program : : : : |
|-----------------------------------------------------------------------|
| ACF - Temporary Assistance for : 19 : 2 : 7 : 10 |
| Needy Families : : : : |
-------------------------------------------------------------------------
aThis program was not evaluated for one of the U.S. territories.
Given the results of the contractor's review, the state readiness
information in the latest OMB quarterly report (see table 2) may have
overstated the status of one state system. One state assessed as at high
risk for the Child Care program was cited as compliant in the OMB report.
The 19 reports also raised a number of concerns. The most common areas of
concern were business continuity and contingency planning and testing.
ACF plans to continue working with the states after the initial on-site
reviews are completed, and a second round of reviews is expected for at
least 10 states. According to an ACF official, this second round of
reviews will include a reassessment of the concerns raised in the first
round as well as technical assistance for business continuity and
contingency planning.
Department of Labor
-------------------
With respect to Unemployment Insurance, State Employment Security Agencies
(SESA) use automated systems to pay unemployment compensation benefits to
eligible workers and collect state unemployment taxes from employers. We
have ongoing work reviewing this program for the House Committee on
Education and the Workforce.
Labor's regional offices are responsible for monitoring the SESAs' Year
2000 activities to better ensure the reliability of state-reported
readiness status information provided quarterly to Labor. In September
1998, Labor established a valuable tool in gauging the readiness status of
state Unemployment Insurance programs by requiring that all SESAs conduct
independent verification and validation reviews of their Unemployment
Insurance programs. The department set a target date of July 1, 1999, for
states to submit independent verification and validation reports of their
Unemployment Insurance systems to Labor. Labor obtained a contractor to
review these reports and rate them from low to high probability of Year
2000 compliance.
According to the Labor contractor's review of states' independent
verification and validation reports for their benefits and tax systems,
o 20 benefits and 19 tax systems had a low probability of compliance,
o 10 benefits and 9 tax systems had a medium probability of compliance, and
o 7 benefits and 6 tax systems had a high probability of compliance.
In addition, 11 and 12 states, respectively, had not submitted independent
verification and validation reports for their benefits and tax
systems./Footnote16/
Given the results of the contractor's review, the information provided in
the latest OMB quarterly report (see table 2) appears to overstate the
readiness status of state systems. Of the 39 state Unemployment Insurance
programs cited in the report as compliant, Labor's contractor rated 15
states as having low probability for Year 2000 compliance for their
benefits and/or tax systems.
Labor's contractor also reviewed states' business continuity and
contingency plans. The states' plans were rated from low to high in terms
of their compliance with Labor's requirements for coverage of core
business functions of benefits and tax systems. Based on the contractor's
completed reviews,/Footnote17/ the quality of state business continuity
and contingency plans varied widely. For example, according to Labor's
contractor (1) 23 benefits and 14 tax plans had a low/very low degree of
compliance with Labor's requirements and (2) 9 benefits and 5 tax plans
had a high degree of compliance with Labor's requirements. In addition,
one and five states, respectively, did not submit business continuity and
contingency plans for their benefits and tax functions.
In summary, much work remains at the state level to ensure that major
services are not disrupted. At particular risk are several states with
systems that are not yet Year 2000 compliant. In addition, federal agency
reviews of business continuity and contingency plans for state-
administered federal programs indicate that many are inadequate. Federal
agencies are working with their state partners to obtain readiness
information and evaluate and provide assistance in key activities such as
business continuity and contingency planning. Nevertheless, some state
completion dates are so close to the turn of the century that the risk of
disruption to their programs is substantially increased, especially if
schedule delays or unexpected problems arise. This is especially
troublesome considering the amount of work remaining in developing
effective business continuity and contingency plans.
Mr. Chairman, Ms. Chairwoman, this concludes my statement. I would be
pleased to respond to any questions that you or other members of the
Subcommittees may have at this time.
Contact and Acknowledgments
For information about this testimony, please contact Joel Willemssen at
(202) 512-6253 or by e-mail at [email protected] . Individuals
making key contributions to this testimony included David Alston,
Pamlutricia Bens, Margaret Davis, Norman Heyl, Troy Hottovy, Linda
Lambert, Glenn Nichols, Steve Schwartz, Cynthia Scott, and Mark Shaw.
--------------------------------------
/Footnote1/-^Year 2000 Computing Crisis: Readiness of State Automated
Systems to Support Federal Welfare Programs (GAO/AIMD-99-28, November 6,
1998).
/Footnote2/-^Year 2000 Computing Crisis: Readiness of State Automated
Systems That Support Federal Human Services Programs (GAO/T-AIMD-99-91,
February 24, 1999).
/Footnote3/-^Year 2000 Computing Challenge: Federal Efforts to Ensure
Continued Delivery of Key State-Administered Benefits (GAO/T-AIMD-99-
241, July 15, 1999).
/Footnote4/-^Appendix I contains a description of each program.
/Footnote5/-^For Medicaid, OMB reports on the two primary systems that
states use to administer the program: (1) the Integrated Eligibility
System, used to determine whether an individual applying for Medicaid
meets the eligibility criteria for participation, and (2) the Medicaid
management information system, used to process claims and deliver
payments for services rendered. Integrated eligibility systems are also
often used to determine eligibility for other public assistance
programs, such as Food Stamps.
/Footnote6/-^In the context of this testimony, the term states can include
the District of Columbia and U.S. territories, such as Puerto Rico.
/Footnote7/-^There was no change in one state-administered federal program
and the number of states with estimated compliance dates in the last
quarter declined by one for a second program.
/Footnote8/-^Year 2000 Computing Challenge: Readiness of USDA High-Impact
Programs Improving, But More Action Is Needed (GAO/AIMD-99-284,
September 30, 1999).
/Footnote9/-^FNS officials told us that some states are reluctant to
provide certification statements because of potential litigation concerns.
/Footnote10/-^GAO/AIMD-99-284, September 30, 1999.
/Footnote11/-^Reported Medicaid Year 2000 Readiness (GAO/AIMD-00-22R,
October 5, 1999).
/Footnote12/-^Thirteen state risk ratings in the low category are based on
the results of first-round visits because the states were not visited in
the second round.
/Footnote13/-^A state can have more than one issue in each area.
/Footnote14/-^As of October 1, 1999, 16 state business continuity and
contingency plans had not been reviewed, and 2 states had not provided
their plans to HCFA.
/Footnote15/-^A state may have more than one issue.
/Footnote16/-^Five benefits and seven tax systems independent verification
and validation reports had not yet been rated.
/Footnote17/-^Eleven state tax business continuity and contingency plans
were not yet rated.
DESCRIPTIONS OF TEN STATE-ADMINISTERED FEDERAL HUMAN SERVICES PROGRAMS
======================================================================
Agriculture
Child Nutrition Programs
------------------------
These provide healthful, nutritional meals to children in public and
nonprofit private schools, child care institutions, adult day care
centers, and summer recreational programs through the National School
Lunch Program, School Breakfast Program, Special Milk Program, Child and
Adult Care Food Program, Summer Food Service Program, and Nutrition
Education and Training Program. Agriculture funds these programs, while
state and local governments administer them. In fiscal year 1998, about
$8.7 billion was obligated for these programs.
Food Stamps
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This program provides low-income households with paper coupons or
electronic benefits transfer cards that can be redeemed for food in about
200,000 authorized stores across the nation. Agriculture administers the
program in cooperation with state agencies. The federal government pays
the full cost of benefits and shares administrative costs with the states.
In an average month in 1998, 19.8 million people, or 8.2 million
households, received benefits.
Special Supplemental Nutrition Program for Women, Infants, and Children
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This program is designed to improve the health of lower-income pregnant,
breast-feeding and postpartum women; infants; and children up to age 5,
who are at nutritional risk. The program provides participants with
nutritious supplemental foods, nutrition, education, and referrals to
health care services. Agriculture provides grants to states that, in turn,
provide program benefits to participants through local agencies. In 1998,
the program reached an average of 7.4 million people each month.
HHS
Child Care
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This is a block grant program that provides low-income families with
financial assistance for child care. It also funds activities to improve
the quality and availability of child care, and to establish, expand, or
conduct early childhood development programs and before- and after-school
programs. Grants are made to the states and Indian tribes to administer
such programs. In fiscal year 1998, about $1 billion in grants was made to
provide child care services for about 1.25 million children.
Child Support Enforcement
-------------------------
This program provides four major services-locating noncustodial parents,
establishing paternity, establishing child support obligations, and
enforcing child support orders-to ensure that children are financially
supported by both parents. The federal government provides funding to the
states and local governments to run this program. In fiscal year 1998, the
federal government provided about $2.6 billion to states and local
governments.
Child Welfare
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Federal grants provide for programs delivering foster care, adoption
assistance, independent living for older foster children, family
preservation and support services, child welfare services, prevention of
neglect/disabled infants, and programs designed to improve the
investigation and prosecution of child abuse and neglect cases. Grants are
provided to states and local agencies to develop and administer such
programs. In fiscal year 1998, about $4.3 billion was obligated to the
states in grants for child welfare programs.
Low Income Home Energy Assistance
---------------------------------
This is a federal block grant program that assists eligible low-income
households in meeting their home energy needs. Grants are made to states,
the District of Columbia, Indian tribes and tribal organizations, and
insular areas. They can be used for energy assistance in heating, cooling,
energy crisis intervention, and low-cost residential weatherization and
other energy-related home repairs. In fiscal year 1998, about $1.2 billion
was obligated for this program.
Medicaid
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This is a federal/state-funded health care program furnishing medical
assistance to eligible needy persons. In fiscal year 1998, Medicaid paid
about $169 billion for medical services to millions of recipients.
Medicaid provides health coverage for about 33 million low-income people,
which include children, the elderly, the blind, and disabled individuals.
Within broad federal guidelines, each state establishes its own
eligibility standards; determines the type, amount, duration, and scope of
services; sets the rate of payment for services; and administers its own
program.
Temporary Assistance for Needy Families
---------------------------------------
This program provides time-limited assistance to low-income families. HHS
provides block grants to the states to operate the program. The states are
given broad flexibility to set eligibility criteria and determine the
types of assistance they provide. In fiscal year 1998, the federal
government provided $16.5 billion in grants to the states.
Labor
Unemployment Insurance
----------------------
The Unemployment Insurance program is a federal-state partnership that
covers 97 percent of all wage earners. Under this program, Labor is
responsible for establishing broad guidelines, general oversight, and
administrative funding, while SESAs pay unemployment compensation benefits
to eligible workers and collect state unemployment taxes from employers.
In fiscal year 1998, these state agencies collected $22 billion in state
unemployment insurance taxes.
(511800)
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