-



U.S. DEPARTMENT OF LABOR
Employment and Training Administration
Washington, D. C. 20210

CLASSIFICATION

UI

CORRESPONDENCE SYMBOL

TEUPR

ISSUE DATE

November 20, 1996

RESCISSIONS

None

EXPIRATION DATE

November 30, 1997

DIRECTIVE

:

UNEMPLOYMENT INSURANCE PROGRAM LETTER NO. 03-97

 

TO

:

ALL STATE EMPLOYMENT SECURITY AGENCIES

 

FROM

:

MARY ANN WYRSCH
Director
Unemployment Insurance Service

 

SUBJECT

:

Implementing Changes in the Unemployment Insurance (UI) Benefit Accuracy Measurement (BAM) Program

  1. Purpose. To outline the status of BAM program changes and announce the date and procedures to be followed in implementing the changes to the program recently approved by the Office of Management and Budget (OMB).

  2. References. UIPL 15-96 (April 2, 1996), "Proposal to Modify the Benefits Quality Control Program;" UIPL 19-96 (April 24, 1996), "Procedures for Release of Unemployment Insurance (UI) Benefit Accuracy Measurement (BAM) (formerly Benefits Quality Control (BQC)) Data for Calendar Year (CY) 1995.

  3. Background. Through UIPL 15-96, the Department solicited comments on a series of modifications to the Benefits Quality Control program (renamed Benefit Accuracy Measurement). The changes were proposed as part of the move to the UI Performs system and were consistent with recommendations by the Vice President's National Performance Review. Comments were sought on the following proposed changes: (1) elimination of the requirement that States publish BAM data findings annually; (2) more elaborate data breakdowns for publications of BAM data; (3) a review of the present BAM data record (Data Collection Instrument or DCI); (4) eventual measurement of the accuracy of decisions denying benefit claims; (5) reductions in required sample sizes to 360 cases per year in the 10 smallest States and 480 in the remainder of the States (the 10 smallest, defined operationally as those with fewest average weeks compensated during each of the past five years, are Delaware, District of Columbia, Montana, Nebraska, New Hampshire, North Dakota, South Dakota, Utah, Vermont and Wyoming); (6) greater flexibility in choosing methods for verifying claims data; and (7) making resources freed up by lower measurement demands available for other UI Performs activities.

    Four main themes characterized the responses to the UIPL. These were: (1) overall acceptance of the proposed changes; (2) concern that integrity would be diminished because of the smaller samples and less in-person verification; (3) uncertainty about the implications of freeing up BAM resources for other uses; and (4) the belief that it was timely to begin examining the accuracy of denials decisions. In response to the concerns expressed in the responses, the Department informed the OMB in the clearance process of its intent to emphasize that the new sample sizes are to be understood as minimum sampling levels. States should not feel constrained to those levels if they believe they need larger ones. In turn, OMB required the Department to clarify this as a condition of its approval. In addition, the Department wishes to stress that, for most States, allocations remain sufficient to verify the 1996 sample sizes using the mix of in-person and telephone contacts instituted in 1993.

  4. Status of BAM Program Changes.

    (a) Publication. Through UIPL 19-96, the Department announced the removal of the requirement that States release their BAM findings in a public forum.

    (b) "Building Block Rates." The Department has developed some preliminary approaches to a "building block" report format which provides alternative breakouts of the BAM data. Two are used to display each State's 1995 data in the 1995 BAM Annual Report.

    (c) DCI Review. Because of other priorities in rolling out the UI Performs system, and because the size of the data record has little effect on BAM costs, the Department has decided to delay the review of the BAM DCI for the time being.

    (d) Denials Accuracy. After soliciting volunteers through UIPL 27-96, the Department selected Nebraska, New Jersey, South Carolina, West Virginia and Wisconsin as pilot States. The pilot is expected to involve 12 months of sampling, beginning in Spring 1997.

    (e) Other. The Department published a "preclearance notice" in the February 5, 1996, Federal Register at 4291 indicating its intention to reauthorize the BAM program under the Paperwork Reduction Act. It proposed sample size reductions, flexibility in investigative methods, and releasing freed-up BAM resources for other UI Performs activities, all of which required OMB approval. On September 15, 1996, OMB approved collection of BAM data through September 30, 1999, with the proposed changes. States should note that the new lower sampling rates are to be understood as minimum sampling levels. They may draw larger BAM samples if their needs would be served by samples larger than the new minimum levels. In addition, under the terms of the approval, States have flexibility in investigative methods and may use resources not needed for BAM investigations for other UI Performs activities. The additional investigative flexibility eliminates the requirement that States make in-person contacts the lead method for obtaining claimant information and verifying worksearch.

  5. Implementation of OMB-Approved Changes. The OMB approval of BAM sample reductions and changes in procedures came too late to enable their implementation on October 1, 1996, as originally intended. States will therefore shift to the new sampling rates and more flexible methodology beginning with batch 9701 (week of December 29, 1996 - January 4, 1997). States must complete investigation of all sampled cases in a timely manner. Therefore they should not plan to shift BAM resources immediately, but allow a phasedown period to complete all investigations of cases "in the pipeline" from previous higher sampling levels. Cases sampled before batch 9701 should be completed using the present "mixed mode" methodology. Budget detail for FY 1997 reflects the phasedown period. The length of this period will depend on the size of the backlog, but should average approximately 2 months; it may also be influenced by the Handbook 395 requirement that 98 percent of calendar year cases be completed within 120 days of the ending date of the calendar year. The specifications of the new investigative procedures will be made available soon through issuance of a revision of the affected sections of Handbook 395.

  6. Action Required. The SESA Administrators are requested to share this information with appropriate staff, and plan accordingly for the changeover date.

  7. Inquiries and Comments. Direct questions and comments to your Regional Office.