Federal Reports

We audited the U.S. Department of Housing and Urban Development’s (HUD) fiscal year 2019 compliance with the Improper Payments Elimination and Recovery Act of 2010 (IPERA). Our audit objective was to determine whether HUD complied with IPERA reporting and improper payment reduction requirements according to guidance from Office of Management and Budget (OMB) Circular A-123, appendix C.Fiscal year 2019 marked the seventh consecutive year in which HUD did not comply with IPERA. In fiscal year 2019, HUD did not comply with two requirements, and one requirement was not applicable. Specifically, HUD did not (1) always publish improper payments estimates for all required programs and (2) meet the reduction targets for its Federal Housing Administration-Single-Family Insurance Claims (FHA-SFIC) program. These conditions occurred because HUD did not yet have an effective process to comply with all IPERA requirements, although it acquired help from a contractor.No recommendations were made because (1) open recommendations from prior years will help HUD remediate the repeat finding of not always publishing improper payments estimates if implemented and (2) OMB relieved HUD from reporting improper payments, which included meeting a reduction target for the FHA-SFIC program beginning next fiscal year.

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The VA Office of Inspector General (OIG) conducted this annual statutorily required review to determine whether VA complied with the requirements of the Improper Payments Elimination and Recovery Act of 2010 (IPERA) for fiscal year (FY) 2019. In FY 2019, VA reported improper payment estimates totaling $11.99 billion for 14 programs and activities, $2.74 billion less than the total reported in FY 2018 for 12 programs and activities. Improper payments are any payments that should not have been made or were made in an incorrect amount. The OIG found VA did not comply with IPERA because it did not satisfy two of the six requirements. VA did not meet annual reduction targets for a program considered at risk for improper payments and did not report a gross improper payment rate of less than 10 percent for six programs and activities as required. VA satisfied the other four IPERA requirements. However, the OIG determined the Veterans Health Administration understated the estimate for a program because it did not sufficiently document that services were received. Also, one corrective action related to a prior OIG recommendation failed to address the root cause of the improper payments. The OIG also identified that four programs and activities have been noncompliant for five consecutive fiscal years, and two activities were noncompliant for three years. VA is required to submit plans to Congress to bring them into compliance. VA satisfied the additional reporting requirements for two high-priority programs and one other program with a monetary loss of more than $100 million for FY 2018. The OIG recommended the VHA executive in charge implement appropriate IPERA testing procedures to ensure verification is completed for services received for the Purchased Long-Term Services and Supports program. One prior OIG recommendation remains open due to repeat findings of ongoing issues.