Summary

Pursuant to a congressional request, GAO identified the benefits that federal entitlement programs could derive from using individuals' quarterly wage information maintained by states for administering unemployment insurance programs.

Studies by GAO have indicated that federal benefit programs overpay significant amounts of benefits due to inadequate verification of income eligibility. GAO found that: (1) the principal barrier to the use of state wage data was the effort involved in doing a nationwide match; (2) state-collected wage data would be useful for verifying beneficiary income levels if it were centralized for easy access; and (3) a central wage file should improve the ability to identify ineligible or overpaid beneficiaries. However, GAO noted that individual privacy might be better protected for those included in a central wage file if: (1) access were restricted to federal agencies having specific legislative authority; (2) the requesting agency used the data for matching purposes only; (3) agencies were restricted from releasing these data to any other agency; and (4) there are appropriate controls to ensure that wage data are accurately recorded.