IHC Applauds Iowa HHS’ Continued Efforts to Address SNAP Payment Error Rate

The Iowa Hunger Coalition applauds ongoing efforts by the Iowa Department of Health and Human Services (HHS) to reduce the payment error rate for the Supplemental Nutrition Assistance Program (SNAP) in Iowa.

Data released last week from the United States Department of Agriculture’s Food and Nutrition Service (USDA FNS) showed Iowa’s payment error rate (PER) for SNAP in FY 2023 was 5.19%, less than half the national average of 11.68%, and a marked improvement from Iowa’s payment error rate of 8.60% in FY 2022. Iowa now ranks as having the 6th lowest SNAP payment error rate of any state or territory in the nation, tied with Wyoming.

“We commend the Department of Health and Human Services and Director Kelly Garcia for their sustained efforts to reduce payment errors for SNAP in Iowa,” said IHC board chair Luke Elzinga. “Ensuring accuracy in benefit payments is vital to protecting the public trust of SNAP.”

The payment error rate measures the accuracy of Iowa HHS’ eligibility and benefit determinations for SNAP. Payment errors include both underpayments and overpayments. They are the result of inadvertent errors made on the part of a SNAP applicant or state agency. The payment error rate does not represent program fraud.

If a household has been found to have received an overpayment of benefits, even if the source of the error was the agency, HHS is required to work toward recovering excess benefits from households, whether that be through reducing future benefit payments or initiating collection actions through the Department of Inspections, Appeals, and Licensing (DIAL). Households who are found to have received an underpayment in benefits may be able to recoup them through a process to restore lost benefits with Iowa HHS.

Background on Iowa’s SNAP Payment Error Rate

In 2019, the state of Iowa was issued a $1.8 million fine from USDA FNS for having a payment error rate of 10.0% – which was 3.2% higher than the national average in FY 2018 (6.8%).

Iowa chose to designate 50% of the liability amount toward new investments in approved activities to improve SNAP administration through its Business Process Redesign (BPR) and designated the remaining 50% of the liability amount as at risk for repayment if a liability amount for an excessive payment error rate was established for FY 2019. This did occur, and the state paid the liability, when the payment error rate for Iowa in FY 2019 increased to 12.5%—5.1 percentage points higher than the national average that year (7.4%).

Since then, Iowa has shown improvements in reducing its payment error rate. While USDA does not have official payment error rate data for FY 2020 and FY 2021 due to the COVID-19 pandemic, according to a 2022 legislative presentation by HHS, the payment error rate for SNAP in Iowa fell to 9.4% in FY 2020 and 6.6% in FY 2021.

“In five short years, Iowa reversed its trajectory on payment error rates and continues to make advances while other states are falling further behind,” said Elzinga. “Iowa’s SNAP payment error rate is now well below the national average, and that is a testament to the work of Director Garcia and the entire team at HHS.”

Muddying the Waters: Misinformation About the Payment Error Rate

When advantageous to their political goals, the payment error rate has been used by politicians and interest groups, namely the Foundation for Government Accountability (FGA) and their lobbying arm, Opportunity Solutions Project (OSP), to negatively target SNAP.

OSP has been active in Iowa since 2017, but following the 2019 fine from USDA for an excessive payment error rate, Representatives and Senators of the Iowa Legislature used the fine as justification for increased administrative hurdles for SNAP and other public assistance programs, focusing greater attention on model legislation drafted by FGA/OSP.  The payment error rate was explicitly used as justification for Senate File 494, which passed Iowa’s legislature in 2023 and was signed into law by Governor Kim Reynolds.

“We know—we know because we’ve been fined by the federal government—we know that fraud and abuse exist within our system…welfare reform is a priority because we have to root out that fraud and abuse.”

Senate President Amy Sinclair, Iowa Press, January 27, 2023

It bears repeating: the payment error rate for SNAP measures the accuracy of Iowa HHS’ eligibility and benefit determinations for SNAP. Payment errors include both underpayments and overpayments. They are the result of inadvertent errors made on the part of a SNAP applicant or state agency. The payment error rate does not represent program fraud.

The Iowa Hunger Coalition lobbied heavily against the passage of SF 494 and called on Gov. Reynolds to veto the legislation. SF 494 has a legislated implementation deadline of July 1, 2025.

Iowa’s federal delegation has also focused attention on SNAP’s payment error rate and used it as justification to negatively target SNAP.

Last September, Sen. Joni Ernst (R-IA) introduced the “Snap Back Inaccurate SNAP Payments Act,” which would require states to cover the cost of overpayments and remove any tolerance threshold when calculating the SNAP payment error rate, making even a single cent of overpayment or underpayment of benefits count toward the payment error rate. In November, Rep. Randy Feenstra (R-IA04) introduced companion legislation to Sen. Ernst’s bill in the House. Press releases announcing both bills included praise from FGA’s president and CEO and reinforced the falsehood that payment errors represent program fraud.

“FGA and OSP have pushed a false narrative equating the payment error rate with fraud, and have unfortunately been successful in doing so, especially in Iowa,” said Elzinga. “But make no mistake: Iowa’s success in reducing its payment error rate pre-dates legislation like SF 494, which has yet to be implemented.”

Areas for Improvement Still Exist

While Iowa’s payment error rate continues to show improvement, other metrics measuring the efficiency and effectiveness of SNAP don’t look as positive for the state, including Iowa’s application processing timeliness (APT).

Iowa’s APT in FY 2022 was 78.34%, meaning that only 78% of SNAP applications in Iowa were processed within a timely manner—30 days for the average applicant, or 7 days for applicants who qualify for expedited service. This was Iowa’s lowest APT since it started being recorded in 2011, and fell well below USDA’s acceptable rate of 95%. 

Perhaps even more concerning is a metric shared in another new report from USDA FNS, Characteristics of SNAP Households – FY22, which found that 44% of entrant SNAP households in Iowa in FY 2022 who qualified for expedited service did not receive it.

Because of its poor performance, Iowa is currently on a Corrective Action Plan (CAP) with USDA FNS to get its application processing timeliness in an acceptable range. USDA FNS data for application processing timeliness has not yet been released for FY 2023.

Additionally, Iowa’s Program Access Index (PAI) for SNAP is currently the lowest it has ranked since 2008, and has ranked below the national average since 2019. Iowa’s SNAP PAI continues to decline, indicating that the program is becoming less and less accessible to Iowans who are eligible for the program.

And while Iowa’s SNAP Case and Procedural Error Rate (CAPER) is below the national average, it is still a concerning number: 33.2% in FY 2023. This means that in one-third of cases where a household’s SNAP benefits were denied, terminated, or suspended one or more of the following was true:

  • The decision was inaccurate; 
  • The notice provided to the household was inaccurate, unclear, insufficient;
  • The notice provided to the household was not timely; and/or  
  • The procedures followed related to these decisions were inaccurate or not timely.

Iowa has made great strides to improve its payment error rate for SNAP, but there are still improvements to be made: not only with continuing to keep the payment error rate down, but also to improve application processing timeliness, reduce the case and procedural error rate in the state, and improve access to the program.

“The Iowa Hunger Coalition calls on our elected officials to take action to ensure Iowans have ready access to the benefits for which they are eligible,” said Elzinga. “When food banks, food pantries, and other anti-hunger organizations are assisting record-breaking numbers of Iowans, SNAP enrollment should not be at a 16-year low in the state. Solely focusing greater scrutiny on caseworkers and applicants to reduce payment errors should not come at the cost of application processing timeliness or reduced access to SNAP benefits.”

Leave a Reply

Your email address will not be published. Required fields are marked *