Issues with delayed benefits and overpayments are causing epidemic struggles.
The unemployment insurance program in Tennessee is facing tremendous problems as the $1.2 billion system, which is administered by the state’s Department of Labor and Workforce Development.
The program is bleeding money through a high trend of overpayments, errors, and fraud.
The unemployment insurance program has made $73 million in overpayments as a result of errors and fraud over a period of six years. Auditors in Tennessee have determined that the department’s program internal controls were either not effective or they didn’t exist at all. The outcome was that there were rampant fraud or error based claims overpayments.
The entire system for unemployment insurance was found to be inefficient or ineffective.
The efforts that have been made by the department to look into claims that have been erroneously paid and the payments that have been made into fraudulent claims in order to collect the overpayments were also quite strained. The estimates are that the state’s department has been capable of collecting only about 23 percent of the overpayments that it has made.
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Furthermore, many state residents who were legitimately eligible for unemployment insurance benefits have not been receiving their payments in a reasonable amount of time. A growing issue with backlogs in the claims processes at the department have delayed some benefit payments for individuals and families who genuinely require the assistance.
These statements and estimates were issued by the Single Audit Report in the state. This annual state agency and university report looks into the compliance of these organizations with the requirements of the federal regulations. This most recent report examined the fiscal year which came to a close on June 30, 2012. It looked into over $15.9 billion in federal funds which were spent by the government of Tennessee.
There were 48 findings identified within the report, along with recommendations that would help to make improvements within eleven different universities and state agencies. Among them was the Department of Labor and Workforce Development, which was the focus of twelve of the report findings. Some of them were directly linked with the program for unemployment insurance in Tennessee.