Head Start:

Action Needed to Enhance Program Oversight and Mitigate Significant Fraud and Improper Payment Risks

GAO-19-519: Published: Sep 13, 2019. Publicly Released: Oct 2, 2019.

Multimedia:

  • GAO: Undercover GAO Agent attempting to enroll into the Head Start program - Audio Recording 1VIDEO: Undercover GAO Agent attempting to enroll into the Head Start program - Audio Recording 1
    Head Start Associate Disregards Part of the Parent's Income.
  • GAO: Undercover GAO Agent attempting to enroll into the Head Start program - Audio Recording 2VIDEO: Undercover GAO Agent attempting to enroll into the Head Start program - Audio Recording 2
    Head Start Associate Disregards Part of the Parent's Income.
  • GAO: Undercover GAO Agent attempting to enroll into the Head Start program - Audio Recording 3VIDEO: Undercover GAO Agent attempting to enroll into the Head Start program - Audio Recording 3
    Head Start Associate Correctly Calculates Income.

Additional Materials:

Contact:

Seto J. Bagdoyan
(202) 512-6722
bagdoyans@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

The Head Start program helps children from low-income families get ready to attend school. We attempted to enroll fictitious children in 15 Head Start centers using information that should have disqualified our applications, such as pay stubs that exceeded income requirements. We found:

Potential fraud at 5 centers. For example, in 3 cases, we retrieved our applications and found they had been doctored to exclude disqualifying information

3 centers encouraged our attendance without following verification requirements

7 centers correctly determined our ineligibility

We made 6 recommendations, including that Head Start assess fraud risk.

A red apple on top of four textbooks

A red apple on top of four textbooks

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Multimedia:

  • GAO: Undercover GAO Agent attempting to enroll into the Head Start program - Audio Recording 1VIDEO: Undercover GAO Agent attempting to enroll into the Head Start program - Audio Recording 1
    Head Start Associate Disregards Part of the Parent's Income.
  • GAO: Undercover GAO Agent attempting to enroll into the Head Start program - Audio Recording 2VIDEO: Undercover GAO Agent attempting to enroll into the Head Start program - Audio Recording 2
    Head Start Associate Disregards Part of the Parent's Income.
  • GAO: Undercover GAO Agent attempting to enroll into the Head Start program - Audio Recording 3VIDEO: Undercover GAO Agent attempting to enroll into the Head Start program - Audio Recording 3
    Head Start Associate Correctly Calculates Income.

Additional Materials:

Contact:

Seto J. Bagdoyan
(202) 512-6722
bagdoyans@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

What GAO Found

GAO’s 15 covert tests at a nongeneralizable selection of Head Start grantee centers found vulnerabilities in centers’ controls for eligibility screening and detecting potential fraud. Posing as fictitious families, GAO attempted to enroll children at selected Head Start centers in metropolitan areas (e.g., Los Angeles and Boston). For each test, GAO provided incomplete or potentially disqualifying information during the enrollment process, such as pay stubs that exceeded income requirements.

  • In 7 of 15 covert tests, the Head Start centers correctly determined GAO’s fictitious families were not eligible.
  • In another 3 of 15 covert tests, GAO identified control vulnerabilities, as Head Start center staff encouraged GAO’s fictitious families to attend without following all eligibility-verification requirements.
  • In the remaining 5 of 15 covert tests, GAO found potential fraud. In 3 cases, documents GAO later retrieved from the Head Start centers showed that GAO’s applications had been doctored to exclude income information GAO provided, which would have shown the fictitious family to be over-income. In 2 cases, Head Start center staff dismissed eligibility documentation GAO’s fictitious family offered during the enrollment interview.

The Office of Head Start (OHS), within the Department of Health and Human Services, has not conducted a comprehensive fraud risk assessment of the Head Start program in accordance with leading practices. Such an assessment could help OHS better identify and address the fraud risk vulnerabilities GAO identified.

OHS has not always provided timely monitoring of grantees, leading to delays in ensuring grantee deficiencies are resolved. In the period GAO examined, OHS did not consistently meet each of its three timeliness goals for (1) notifying grantees of deficiencies identified during its monitoring reviews, (2) confirming grantee deficiencies were resolved, and (3) issuing a final follow-up report to the grantee. In October 2018, OHS implemented new guidance (called “workflows”) that documents its process for notifying, following up, and issuing final reports on deficiencies identified by its monitoring reviews. However, OHS has not established a means to measure performance or evaluate the results of its new workflows to determine their effectiveness.

Vulnerabilities exist for ensuring grantees provide services to all children and pregnant women they are funded to serve. For example, OHS officials said grantees have the discretion to allow children with extended absences—sometimes of a month or more, according to GAO’s analysis—to remain counted as enrolled. OHS officials told GAO that a child’s slot should be considered vacant after 30 days of consecutive absences, but OHS has not provided that guidance to grantees. Without communicating such guidance to grantees, OHS may not be able to ensure slots that should be considered vacant are made available to children in need. Further, OHS risks paying grantees for services not actually delivered.

Why GAO Did This Study

The Head Start program, overseen by OHS, seeks to promote school readiness by supporting comprehensive development of low-income children. In fiscal year 2019, Congress appropriated over $10 billion for programs under the Head Start Act, to serve approximately 1 million children through about 1,600 Head Start grantees and their centers nationwide. This report discusses (1) what vulnerabilities GAO’s covert tests identified in selected Head Start grantees’ controls for program eligibility screening; (2) the extent to which OHS provides timely monitoring of grantees; and (3) what control vulnerabilities exist in OHS’s methods for ensuring grantees provide services for all children and pregnant women they are funded to serve. GAO conducted 15 nongeneralizable covert tests at Head Start centers in metropolitan areas. GAO selected only centers that were underenrolled to be sure we did not displace any actual, eligible children. GAO also reviewed OHS timeliness goals and data for the period October 2015 through March 2018, and used attendance data to verify enrollment data reported for early 2018 for a nongeneralizable sample of nine grantees.

What GAO Recommends

GAO makes six recommendations, including that OHS perform a fraud risk assessment, develop a system to evaluate the effectiveness of its new workflows, and communicate guidance on when a student’s slot should be considered vacant due to absenteeism. OHS concurred with four recommendations, but did not concur with two. GAO believes the recommendations remain valid.

For more information, contact Seto J. Bagdoyan at (202) 512-6722 or bagdoyans@gao.gov.

Recommendations for Executive Action

  1. Status: Open

    Priority recommendation

    Comments: In February 2020, HHS told us that the Administration for Children and Families (ACF) is developing a Fraud Risk Assessment template for all of its programs (including the Office of Head Start) and is on track to complete the initial Fraud Risk Assessment for its pilot program by June 30, 2020. Upon completion of the Fraud Risk Assessment for the ACF pilot program, ACF anticipates completing its initial Fraud Risk Assessment for OHS, by March 31, 2021. We will assess these actions once completed.

    Recommendation: The Director of OHS should perform a fraud risk assessment for the Head Start program, to include assessing the likelihood and impact of fraud risks it faces. (Recommendation 1)

    Agency Affected: Department of Health and Human Services: Administration for Children and Families: Office of Head Start

  2. Status: Closed - Implemented

    Comments: In March 2020, Office of Head Start (OHS) officials confirmed that they had explored options for additional risk-based monitoring of the program, including covert testing, in response to GAO's recommendation. Specifically, these officials stated that they decided to begin significantly increasing their unannounced examinations of grantees as part of their fiscal year 2020 monitoring procedures. The officials stated that they believed that unannounced site visits, coupled with additional review of attendance data and other risk-based approaches, represented a good balance of risk-based monitoring without jeopardizing the program's mission of reaching at-risk families. The officials also told us that they had explored covert testing as an option, but believed the risks associated with covert testing outweighed the benefits. For example, the officials noted that conducting covert testing might change the mindset of intake staff at Head Start grantees to look at applicants as an adversary or fraudster by default, and this mindset might lead the intake staff to treat the applicants in a way that would inappropriately jeopardize the applicants' access to the program. By exploring and implementing these additional risk-based approaches to monitoring the program, OHS has taken an important steps to prevent fraud, waste, and abuse in Head Start.

    Recommendation: As part of the fraud risk assessment for the Head Start program, the Director of OHS should explore options for additional risk-based monitoring of the program, including covert testing. (Recommendation 2)

    Agency Affected: Department of Health and Human Services: Administration for Children and Families: Office of Head Start

  3. Status: Open

    Comments: HHS did not concur with this recommendation. In February 2020, HHS stated that OHS regularly evaluates its effectiveness of its workflows to determine how to best adjust the system to support effective follow-up. HHS also stated that, for Fiscal Year 2020, OHS has updated its internal workflow timelines to increase responsiveness to identified findings and ensure grantee support. We will continue to monitor HHS's efforts in this area.

    Recommendation: The Director of OHS should establish procedures to monitor and evaluate OHS's new internal workflows for monitoring reviews, to include establishing a baseline to measure the effect of these workflows and identify and address any problems impeding the effective implementation of new workflows to ensure timeliness goals for monitoring reviews are met. (Recommendation 3)

    Agency Affected: Department of Health and Human Services: Administration for Children and Families: Office of Head Start

  4. Status: Closed - Implemented

    Comments: In February 2020, OHS provided us information indicating that it revised its onsite monitoring guidance to include the use of grantee attendance data for verifying the reliability of enrollment data that grantees submit to OHS. Specifically, OHS updated its Fiscal Year 2020 onsite monitoring guidance to include an expanded section dedicated to enrollment verification. This guidance states that, as part of monitoring reviews, grantees will provide OHS reviewers the source documentation (including attendance data) for the last 4 months of enrollment numbers submitted to OHS. By taking these steps to verify the accuracy of grantees' enrollment data, OHS will help ensure that grantees are serving all children they are funded to serve.

    Recommendation: The Director of OHS should adopt a risk-based approach for using attendance records to verify the reliability of the enrollment data OHS uses to ensure grantees serve the number of families for which they are funded, such as during OHS's monitoring reviews. (Recommendation 4)

    Agency Affected: Department of Health and Human Services: Administration for Children and Families: Office of Head Start

  5. Status: Open

    Comments: In February 2020, OHS told us that it is finalizing program guidance that will address when a child's slot should be considered vacant due to absenteeism and what a program should do fill it. OHS stated that it anticipates having a final paper published by summer, 2020. We will continue to monitor OHS's efforts in this area.

    Recommendation: The Director of OHS should provide program-wide guidance on when a student's slot should be considered vacant due to absenteeism. (Recommendation 5)

    Agency Affected: Department of Health and Human Services: Administration for Children and Families: Office of Head Start

  6. Status: Open

    Comments: In February 2020, OHS told us that it is developing a toolkit of resources specifically designed to offer best practice tips for Early Head Start programs on how to track attendance and services to pregnant women. OHS is surveying the Head Start community to better determine what resources are already available and how programs in different regions and cities track services to pregnant women. OHS anticipates a rollout for the toolkit by summer, 2020.

    Recommendation: The Director of OHS should develop and implement a method for grantees to document attendance and services under EHS pregnancy programs. (Recommendation 6)

    Agency Affected: Department of Health and Human Services: Administration for Children and Families: Office of Head Start

 

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