Review of HHS Inspector General's Report on California's Refugee Resettlement Program

Pursuant to a congressional request, GAO reviewed the Department of Health and Human Services (HHS) Inspector General's (IG) audit of federal payments to California for its Resettlement Program. The IG audit concluded that almost $34 million of the $256 million California received did not qualify for federal funding. GAO examined the IG audit methodology and the conclusions that were reached.

GAO found that the IG report showed that California's administration of its Refugee Resettlement Program (RRP) could be improved in the area of cash assistance payments. According to the IG, the seven counties audited: (1) did not fully document recipient eligibility for cash assistance or properly determine recipient eligibility under other federally funded programs; (2) used funds for payments to ineligible persons and for payments that exceeded allowable amounts; and (3) did not adequately monitor claims for recoveries and overpayments. The report concluded that California had been overpaid and recommended that the state reduce its claim for federal funds. California disagreed with the sampling and estimation methodology which the IG used and advised GAO that there should be a tolerance level for ineligible payments under RRP similar to quality control processes used by other federal programs. GAO believed that the IG used the appropriate methodology and was in conformity with accepted auditing standards, although the state has been given an opportunity to submit additional documentation to establish that the questionable payments met all of the criteria for eligibility.