States slow on Y2K fixes for federal welfare programs

State-run computer systems that provide federal welfare benefits to the public are behind schedule on year 2000 conversion, a new report says.

The General Accounting Office found that only one-third of the 421 state government welfare systems were year 2000 compliant by August. In its year 2000 guidelines, the Office of Management and Budget said systems fixes should have been completed by September.

The GAO report, "Year 2000 Computing Crisis: Readiness of State Automated Systems to Support Federal Welfare Programs" (AIMD-99-28), highlights a significant problem federal agencies face as the year 2000 draws near. Many federal programs rely on non-federal computers to function.

"Failure to complete year 2000 conversion could result in billions of dollars in benefits payments not being delivered," GAO said. "Potential problems states cited were that new recipients could not be added to the recipient file, eligibility for new applicants could not be determined, recipients could be denied benefits, payments could be underpaid or overpaid and payments could be delayed."

GAO surveyed Y2K coordinators in the 50 states, the District of Columbia, Puerto Rico, Guam and the Virgin Islands.

Only 16 percent of state Medicaid systems were Y2K-compliant, even though 64 percent of states reported receiving guidance from the federal Health Care Financing Administration. Similarly, only 24 percent of state food stamp systems and 38 percent of state women, infants and children nutrition program (WIC) systems are ready for the year 2000, even though 87 percent of states say they received oversight from the Agriculture Department's Food and Nutrition Service.

The four other federal welfare programs GAO reviewed were also behind schedule (Temporary Assistance for Needy Families, 25 percent ready; Child Support Enforcement, 38 percent ready; Child Care, 56 percent ready; Child Welfare Programs, 51 percent ready).

Seventy-seven percent of the states said they need more funding from the federal government to fix the welfare systems. States will spend at least $545 million on Y2K fixes from 1997 to 2001, GAO said. Another 43 percent of states said they would like to see the federal government share Y2K best practices with them.

Only one state, Idaho, reported fixing all of its welfare systems.