More Accountability with Welfare Funds Could Save Millions of Taxpayer Dollars

By Matthew Nicaud
October 27, 2021

Despite being a fairly conservative state, Mississippi still spends a large amount of its state budget on welfare and entitlement programs. Many of the programs themselves have structural problems on a policy level. Yet, many have also managed to cheat the programs themselves and exacerbate the problems that systemically arise from welfare and entitlement systems.

In order to grasp the importance of accountability and verification with the use of state welfare dollars, it is vital to grasp the scale of welfare and entitlement spending in the state. The state budget allocates much of its budget to welfare and/or entitlement programs such as Medicaid, TANF, Division of Community Services, and others. There are really two main types of fraudulent activity that contribute to the waste of taxpayer dollars in this system.

The first is the more blatant type of fraud in which an individual utilizes the money in these programs without having ever qualified for them in the first place. This is the case with many of the recent high-profile scandals in the state in which millions of dollars were directly stolen from these programs. This is also the case when individuals submit fraudulent documents that allow them to “qualify” for state resources that they would not qualify for legitimately.

The second type of fraud is if an individual initially qualifies for a program and then attempts to hide a change in circumstances, such as an income increase.  For most programs, state law requires individuals to notify the government if a change in circumstances has made them ineligible for the program. Such fraud goes against the allegedly temporary basis that these programs are designed for.

Both types of fraud have wasted millions of taxpayer dollars over the years. The systems themselves already have to deal with the challenges of managing the funds, and fraud adds an additional layer of complexity. In order to ensure that taxpayer dollars are not being consumed by fraud, the state should take proactive measures that require more verification and accountability protocols for the use of these funds.

The state already has access to several levels of verification, including driver’s licenses, state income tax returns, unemployment records, and others. Rather than having vague rules that vary from agency to agency and have numerous administrative loopholes, the state should consider inter-agency identity and income verification procedures that fill in the gaps. In some cases, even a basic cross-reference of welfare applications with state income tax returns could provide documented proof.

Instead of having policies that allow fraud to slip through frequently, state leaders should consider leveraging every available tool to verify that state welfare dollars are not lining the pockets of fraudsters. This is a critical step to help cut down on the waste of funds that digs right into taxpayers' pocketbooks.


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