by Andrew Walden
Hawaii has the lowest rate of Unemployment Insurance paid in error over the last year. For the period from July, 2010 to June, 2011, of Hawaii’s $308M in Unemployment Compensation payments, “only” 3.1% were paid wrongly. The total in overpayments was $9,555,990 according to figures released by the US Department of Labor.
For the three-year period from July, 2008 to June, 2011 Hawaii had the fourth-lowest rate of Unemployment Compensation overpayments, with only 4.2% paid in error.
While this may seem like a incongruous victory for Hawaii’s outdated Wang-and-filing cabinet IT System and a gold star for Hawaii’s much-maligned State government employees, officials point to the complexity of UComp rules as a leading cause of overpayments. States with more stringent UComp requirements have higher error rates—and those such as Hawaii which require little from the unemployed therefore have few errors.
Indiana tops the listing at 43% UComp overpayments, but the Wall Street Journal reports:
Mark Everson, commissioner of the Indiana Department of Workforce Development, said the differences in error rates stem from variations in state programs.
“To characterize it as waste, fraud and abuse is just manipulative,” Mr. Everson said. “There’s no way in the world you could cut the 43% of people off.”
Mr. Everson pointed out that in Indiana, benefit recipients are required to list three work searches. If a recipient fills out only two of the three searches correctly, there are cases when the recipient can still receive benefits. But that counts as an error.
The Labor Department noted, “it may be misleading to compare one state’s payment accuracy rates with another state’s rates… States with stringent or complex provisions tend to have higher improper payment rates than those with simpler, more straightforward provisions.” …
A large percentage of unemployment benefits are paid in error. The following chart shows the amount overpaid in each state from July 2010 to June 2011 and the rate of overpayment. The Labor Department cautions that no two states' written laws, regulations and policies specifying eligibility conditions are identical, and differences in these conditions influence the potential for error. States with stringent or complex provisions tend to have higher improper payment rates than those with simpler, more straightforward provisions.
US DoL: Chart
WSJ: Billions in Unemployment Benefits Paid in Error