A nonprofit publication of the Kentucky Center for Public Service Journalism

Kentucky has high rate of improper payments in the Unemployment Insurance program


By Tom Latek
Kentucky Today

Kentucky has one of the highest rates of improper payments in the Unemployment Insurance program, but state officials say they have taken steps to bring it under control.


The Improper Payments Elimination and Recovery Act of 2010, enacted by Congress, requires programs to report an annual improper payment rate below 10 percent, and the Unemployment Insurance program, or UI, established a performance measure for states to meet the 10 percent requirement. For the 2018 reporting period, the national UI program reported an estimated national improper payment rate of 13.05 percent.


According to a report issued this month by the U.S. Department of Labor, 23 states were at 10 percent or less, ten had an improper payment rate of 10-13 percent, while the other 19 states were above 13 percent.


  

The report states Kentucky’s estimated improper payment rate for the period from July 1, 2015 through June 30, 2018 was 19.02 percent. This also includes an improper payment estimate in Kentucky of $63,435,432 in 2018.


“Providing states with resources to recognize and combat improper Unemployment Insurance payments is a critical piece of our Federal-state partnership,” said U.S. Secretary of Labor Alexander Acosta. “I have contacted Governors across the nation and asked them to recommit to lowering the UI improper payment rate in their state. The Department stands ready to help states with high level of improper payments by providing targeted assistance where it’s needed most.”


When asked for comment on the findings, Deputy Education and Workforce Development Cabinet Deputy Secretary Josh Benton responded by saying, “The Office of Unemployment Insurance is committed to program integrity and reducing improper payments to ensure the solvency of the trust fund is healthy, to provide benefits to unemployed workers.”


He says they have made updates to policies and procedures to decrease improper payments and ensure unemployed workers are re-engaged with career centers, and those steps taken have been successful.
 

“As of 4th Quarter 2018, Kentucky’s improper payment rate was 9.08 percent, below the Department of Labor’s goal of 10%,” he said.  “Additionally, in Calendar Year 2018, over 76% of all improper payments have been collected and monies returned to the trust fund.”


Benton adds, “The Department of Labor conducted a site-visit last week to offer technical assistance and was pleased with the measures taken to address improper payments.  Our office looks forward to a continued partnership with DOL to implement further recommendations.”


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