YELLOW SHEET Office of the State Auditor of Missouri Claire McCaskill

August 3, 2001

Report No. 2001-58

Government benefits delivered better with new electronic system

The Department of Social Services� new electronic benefits transfer system disburses benefits more efficiently and reduces the chance of fraud.� This audit found no major deficiencies in the new system, which replaced paper benefit coupons. � 

Benefit payment accuracy rate above national average 

The new system pushed Missouri�s food stamp payment accuracy rate above the national average. �Before the new system started, Missouri had an 88 percent accurate payment �rate as compared to the 90 percent national average. But since the 1998 inception of the new system, Missouri�s payment record has consistently ranked above the national average, with a 92 percent accuracy rate in 2000. �Department officials credit a quality control system, which logs over- and under-payment errors, and a monthly staff publication with suggestions on improving accuracy. (See page 5) 

Benefits still paid to deceased persons 

About 72 percent of the deceased persons checked in our audit tests still received $31,130 in benefits following their deaths.�� Department officials said a reasonable time to stop payments due to a death is 2 months.� Our tests showed it took 6 months on average to terminate benefit payments. (See page 6) 

Prisoners receive benefit payments while incarcerated  

Audit tests showed prisoners received benefit payments in violation of state and federal laws. �Of the 114 inmates reviewed in these tests, 45 inmates received payments totaling at least $13,100.� Prisoners received payments for up to 12 months in some cases. �(See page 7) 

Photographs on cards too costly, useless �

The state and the federal government have nearly split the $1.8 million cost to place client photographs on the electronic benefit security cards. �This cost is about to increase when the state renews the contract and purchases new camera equipment for $752,000. State officials expected the cards to help deter fraud, but federal regulations allow any family member to use the card, which renders the photographs useless for fraud or identification. Retailers, in fact, are trained to ignore the photograph, since transactions are valid if the purchaser has the card and personal identification number. (See page 8)

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