Bills propose fraud-buster

In an effort to crack down on fraud in the Food Stamp Program, new legislation introduced late last month would require the Agriculture Department to set up computerized matching of data with the Social Security Administration to weed out those ineligible to receive the benefits.

Computerized matching would require states, which are responsible for the day-to-day operation of the food stamp program, to cross-check SSA's death records with the food stamp rolls. This would help prevent food stamp benefits from being sent to deceased people, a costly problem highlighted by the General Accounting Office earlier this year.

The Food Stamp Program provides benefits to low-income individuals and families who do not otherwise have the means to obtain a healthy diet. The USDA's Food and Nutrition Service (FNS) administers the program in cooperation with the states. Under the current program, households are required to notify their welfare office within 10 days of any changes in the makeup of the household.

However, in a report issued in February, GAO found that in the four large states it studied— California, Florida, New York and Texas— nearly 26,000 deceased individuals were included in households receiving food stamps. In its study, GAO matched automated food stamp records with SSA's death master file.

"These households improperly collected an estimated $8.5 million in food stamp benefits," said Rep. Bob Goodlatte (R-Va.), chairman of the House Agriculture Committee's Subcommittee on Department Operations, Nutrition and Foreign Agriculture, which held a hearing on the subject earlier this month. "Waste, fraud and abuse cannot be tolerated."

In an effort to curb the abuse, Goodlatte introduced the Food Stamp Verification Act of 1998 (H.R. 4366), which would require the secretary of Agriculture to enter into a data-sharing arrangement with the SSA commissioner so that data can be shared, matched and verified. SSA already has a data exchange system in place to notify states when Social Security benefit recipients die. Sen. Richard Lugar (R-Ind.) has introduced similar legislation in the Senate (S. 1733).

GAO recently found evidence of more fraud, including $1.4 billion in overpayments of food stamp benefits last year, according to Robert Robertson, associate director of food and agriculture issues at GAO's Resources, Community and Economic Development Division. In addition, most recent data shows that in 1993, about $815 million in food stamps were traded for cash at retail stores, Robertson testified. "While the USDA has reduced the overpayment rate in recent years, further reductions could result if the food stamp rolls were matched against computerized information held by various sources in order to identify ineligible participants," Robertson said. "Computer matching can provide a cost-effective mechanism to accurately and independently accomplish this."

The cost of conducting computer matches can be relatively low, and GAO plans to use computer matching to identify other groups, such as prisoners, who are ineligible to receive food stamps, Robertson said. States already have initiated their own computer matching programs, which match information with neighboring states to detect duplicate participants in the program.

Shirley Watkins, undersecretary for the USDA's Food, Nutrition and Consumer Services, said overpayments and payments to ineligible households have been decreasing since 1993. "Critical to the success of the department's activities to combat fraud is our interaction and exchange of information with states," Watkins said in written testimony.

FNS encourages states to match data with SSA, state wage databases and other sources such as motor vehicle databases, Watkins said. States, she added, strongly support the use of SSA's death master file. "We believe that a mandated match by state food stamp agencies is consistent with and will strengthen the Food Stamp Program's existing matching requirements," she said.