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Aug 31 -- The Employment and Training Administration (ETA) invites public comment to OMB by September 30, 2022 regarding Unemployment Insurance Benefit Accuracy Measurement (BAM) programs.

Since 1987, all State Workforce Agencies except the U.S. Virgin Islands have been required by regulation at 20 CFR part 602 to operate Benefit Accuracy Measurement (BAM) programs to assess the accuracy of their unemployment insurance (UI) benefit payments in three programs: State UI, Unemployment Compensation for Federal Employees (UCFE), and Unemployment Compensation for Ex-servicemembers (UCX). BAM is one of the tools DOL uses to measure and reduce improper payments in the UI program.
 
The Unemployment Insurance (UI) BAM system (formerly Quality Control [QC]) provides the basis for assessing the accuracy of UI payments and denial of benefits. It is also a diagnostic tool for the use of Federal and State Workforce Agency (SWA) staff in identifying errors and their causes and in correcting and tracking solutions to these problems.  Representative samples of UI payments and disqualifying ineligibility determinations are drawn and examined intensively to determine whether they were properly administered to claimants and whether these claimants were paid the proper amounts, or appropriately denied.  Based on the errors identified and information gathered, states will be able to develop plans and implement corrective actions to ensure accurate administration of state law, rules, and procedures.

The major objectives of the BAM system are to:

Assess the accuracy of UI payments;
Estimate the UI improper payment rate as required by Federal Law;
Promote improvements in program accuracy and integrity; and
Encourage more efficient administration of the UI program.

The basis for determining payment and denial accuracy are federal and state law, administrative code/rules, and official policy. The system is designed to be comprehensive in coverage by including all areas of the claims process where errors could occur.

The BAM program is the Department’s Office of Management and Budget’s (OMB) approved tool for measuring improper payments.  The program consists of two comprehensive reviews:  Paid Claims Accuracy (PCA) and Denied Claims Accuracy (DCA).  States conduct intensive audits of statewide random samples of UI payments and denials to determine their accuracy.  

One purpose of BAM is to reduce waste, fraud, and abuse in the UI program.  By investigating small representative weekly samples of paid and denied UI claims, it enables each SWA to estimate reliably the number of proper and improper payments (i.e., overpayments and underpayments) and denials, their rates of occurrence, and their types, causes, and responsibilities.  For paid claims, BAM also estimates the dollar value and rate of improper payments.  BAM PCA and DCA audits also provide information that can be used for program improvement, including the type of payment error, error cause, responsible party, point of detection within the system, and the actions of the claimant, employer, and agency prior to the BAM investigation.

The Department uses BAM data to measure state performance with respect to UI payment integrity and to meet the Department’s reporting requirements of Public Law 116–117 known as the ‘‘Payment Integrity Information Act of 2019” (PIIA), Appendix C to OMB Circular A-123,issued March 5, 2021,and the Government Performance and Results Act (GPRA).  SWAs use both paid claims and denied claims data to evaluate the quality of their existing UC claims processes. It enables a SWA to meet its primary objective of strengthening the controls that prevent errors and/or fraud and abuse in the payment and denial of UI benefits.

The data collected in accordance with prescribed BAM methodology provides national and SWA administrators with accurate measurements of the rate of proper and improper payments and denials, the reasons for improper payments and denials, and who is responsible for them.  Identification of specific types, causes, and responsibility for errors provides information about the effectiveness of state programs and the quality of their underlying policies, thereby serving as a basis to improve and strengthen program operations.  BAM data can lead state and national program managers to make significant program improvements resulting in dollar savings, and continuing benefit payment integrity.

The Department’s National and Regional Office UI staff use the BAM data to provide technical assistance to state UI programs.  The data are also used as part of the Department’s policy analysis and policy formulation functions, and are an essential component of UI Performs, the Department’s performance management system.

UI Performs promotes continuous improvement in UI performance through the establishment of core performance measures and acceptable levels of performance (ALPs).  One of these core measures, Overpayment Detection, includes BAM data.  Under UI Performs, state and Federal staff work cooperatively to identify areas of UI programs that need improvement and develop appropriate plans through the annual State Quality Service Plan (SQSP).  The Department believes that the SQSP mechanism is the most effective method for drawing attention to all performance deficiencies and providing opportunities to plan for improvements. The Department reissued guidance on January 27, 2015 on the methodology BAM data will be used to measure state performance.   

BAM samples are drawn weekly and investigated on an on-going basis to reflect unemployment insurance program activity such as making initial eligibility determinations and verifying continuing eligibility through a weekly certification process.  The data are entered into the database as case investigations are completed.  The Department runs a program each night to pick up any changes in the SWAs' databases.  The current frequency of the data collection is necessary to ensure the quality and integrity of the data for several reasons:

Because sampling frames (populations) are assembled and samples are drawn weekly, sample and population characteristics can be compared to determine the representativeness of the samples and the integrity of the sampling frames. . . .

Experience in the BAM program demonstrates that the review of completed cases is more accurate and efficient the sooner it occurs.
 
The respondent universe for paid and denied claims comprises fifty-two State Workforce Agencies (SWAs), claimants, employers, and third parties.  Within each SWA, the universe for paid claims is defined as all intrastate and interstate weeks paid (or offset) in the State Unemployment Insurance (UI), Unemployment Compensation for Federal Employees (UCFE), and Unemployment Compensation for Ex-servicemembers (UCX) programs.  For denied claims, each SWA defines three universes of formal, documented denial decisions or determinations of ineligibility for benefits.  These denial decisions are based on (a) monetary issues; (b) separation issues; and (c) nonseparation, or "continuing eligibility" issues.   

UI BAM Programs: https://oui.doleta.gov/unemploy/bam/2002/bam_fact.asp
UI BAM Programs submission to OMB: https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=202208-1205-004 Click IC List for survey instrument, View Supporting Statement for technical documentation. Submit comments through this site.
FR notice inviting comment: https://www.federalregister.gov/d/2022-18777
 
For AEA members wishing to submit comments to OMB, the AEA Committee on Economic Statistics offers "A Primer on How to Respond to Calls for Comment on Federal Data Collections" at https://www.aeaweb.org/content/file?id=5806

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