Once Dead, Twice Billed: GAO Questions COVID Funeral Rewards

The Federal Emergency Management Agency may have received a double bill for burying hundreds of people who have died from COVID-19, according to a new report released Wednesday by the Government Accountability Office.

The GAO identified 374 people who died and were listed in more than one application that received an award from the COVID-19 relief fund. The report says this equates to about $4.8 million in aid that could be inappropriate or potentially fraudulent.

FEMA spokeswoman Jacqueline Rothenberg said on Wednesday that this was not an example of large-scale fraud, and the amount of funeral assistance identified as at risk was relatively small, and FEMA’s “multiple internal quality controls and fraud controls” resulted in improper payments. less than 1%.

“Unfortunately, fraud, especially identity theft, is common. FEMA has controls in place to detect cases and can and will prosecute anyone who fraudulently seeks help,” Rothenberg said in a statement.

FEMA told the GAO that in some of the duplicate claims, funeral assistance was misassigned due to processing errors rather than fraud, and in some cases benefits were not actually paid twice, the report said.

The cases have been referred to the Department of Homeland Security’s Office of the Inspector General to review whether any fraud investigations should be launched, said Chris Curry, who leads the GAO’s emergency management, disaster response and recovery work, and Rebecca Shea, who oversees GAO audits to detect fraud, waste and abuse.

Shea said they could not confirm whether FEMA paid twice in all cases. She said she thought the scammers were likely targeting the fund, and some of them involved data entry errors.

“Given everything we’ve seen in pandemic programs over the past two years, if scammers weren’t trying to take advantage of this system, that would be amazing to me,” she said on Wednesday.

The report says that as of the end of last year, FEMA had provided about $1.5 billion in aid in response to about 235,000 claims from nearly 237,000 people who have died from COVID-19. While duplicates make up less than 0.2% of applications, the GAO said the findings are significant due to the possibility of improper payments and potential fraud in this and future disasters.

In the decade before the pandemic, there were only about 6,000 applications for funeral assistance following other natural disasters. Use of the program has “exploded” since Congress expanded it for COVID-19 by providing $50 billion from the Disaster Relief Fund for such relief, Curry said, prompting the GAO to conduct a forensic investigation.

Most of the 374 deaths listed on more than one application were listed by different applicants, according to the GAO. The GAO provided FEMA with three examples. The report said FEMA claimed processing errors and began trying to refund money on two occasions in January.

The report states that about 50 deceased persons were listed in multiple applications from the same applicant. Initially, FEMA said there were duplicates in the system due to a change in geographic coding, and in each case only one of the applications was paid, but when the GAO provided examples, FEMA confirmed that the duplicate applications were paid, the report said.

In addition, the GAO said it has identified 400 additional claims that received benefits in excess of the maximum $9,000 per death — some up to nearly $20,000 — for an additional roughly $4.7 million in assistance that may have been improper or potentially fraudulent payments.

Thousands of awards were handed out in cases where the date of death was missing or invalid, according to data provided by FEMA, according to the GAO. Shi said that sometimes the applicant was listed as a deceased person or the date of death was before the start of the pandemic, raising questions about how FEMA could determine eligibility in such cases.

“It shouldn’t be,” she said. “You know, the dead don’t qualify for benefits.”

The GAO recommends that FEMA implement additional controls to prevent and detect improper payments and potential fraud, and address data deficiencies by updating records as data is verified and adding data fields where necessary.

Rothenberg said FEMA has put in place additional controls prior to the implementation of COVID-19 funeral assistance to reduce the risk of fraud and identity theft. She said FEMA requires verifiable documentation for funeral expenses, including funeral home contracts and receipts, and conducts numerous reviews.