GAO-21-387, COVID-19: Sustained Federal Action Is Crucial as Pandemic Enters Its Second Year

Issuer: Government Accountability Office
Document type: Report
Date: 2021-03-15

Report — GAO-21-387, COVID-19: Sustained Federal Action Is Crucial as Pandemic Enters Its Second Year, dated 2021-03-15, issued by Government Accountability Office.

Full text

United States Government Accountability Oﬃce
Report to Congressional Committees
March 2021
COVID-19
Sustained Federal Action Is Crucial
as Pandemic Enters Its Second Year
GAO-21-387
www.gao.gov

United States Government Accountability Office
Highlights of GAO-21-387, a report to
congressional committees

March 2021
COVID-19
Sustained Federal Action Is Crucial as Pandemic
Enters Its Second Year
What GAO Found
More than a year after the U.S. declared COVID-19 a public health emergency, the
pandemic continues to result in catastrophic loss of life and substantial damage to the
global economy, stability, and security. According to data from the Centers for
Disease Control and Prevention’s (CDC) National Center for Health Statistics, about
520,000 more deaths occurred from all causes (COVID-19 and other causes) than
would be normally expected from February 2020 through mid-February 2021,
highlighting the effect of the pandemic on U.S. mortality (see figure). The pandemic
also continues to cause economic challenges, particularly for the labor market. As of
February 2021, there were about 10 million unemployed individuals, compared to
nearly 5.8 million at the beginning of 2020.
Higher-Than-Expected Weekly Mortality in the U.S., February 2020 through Mid-
February 2021
In the past year, GAO has made 44 recommendations for agency actions, 6 of which
have been implemented. Since taking office, the new administration has taken some
action consistent with GAO’s recommendations, such as issuing the National
Strategy for the COVID-19 Response and Pandemic Preparedness and issuing
executive orders calling for the development of a pandemic supply chain resilience
strategy and providing emergency economic relief. GAO will continue to monitor the
administration’s actions toward addressing GAO’s recommendations in future
reporting.
In this report GAO is making 28 new recommendations in the areas of public health,
the economy, and program integrity. Implementing these 28 recommendations, as
well as 38 of GAO’s 44 prior recommendations that have not been fully implemented
from CARES Act reports issued since June 2020, would improve the ongoing federal
response to COVID-19.
View GAO-21-387. For more information,
contact A. Nicole Clowers, (202) 512-7114 or
clowersa@gao.gov.
Why GAO Did This Study
As of March 15, 2021, the U.S. had
over 29 million reported cases of
COVID-19 and more than 523,000
reported deaths, according to CDC.
The country also continues to
experience serious economic
repercussions.
Five relief laws, including the CARES
Act, were enacted as of January 31,
2021, to provide appropriations to
address the public health and
economic threats posed by COVID-19.
As of January 31, 2021, of the $3.1
trillion appropriated by these five laws
for COVID-19 relief, the federal
government had obligated a total of
$2.2 trillion and expended $1.9 trillion,
as reported by federal agencies.
Most recently, in March 2021, a sixth
relief law, the American Rescue Plan
of 2021, was enacted and provides
additional federal assistance for the
ongoing response and recovery.
The CARES Act includes a provision
for GAO to report on its ongoing
monitoring and oversight efforts related
to the COVID-19 pandemic. This report
examines the federal government’s
continued efforts to respond to and
recover from the COVID-19 pandemic.
GAO reviewed data, documents, and
guidance from federal agencies about
their activities and interviewed federal
and state officials, experts, and other
stakeholders, including health care
professionals.
What GAO Recommends
GAO is making 28 new
recommendations for agencies that are
detailed in this Highlights and in the
report.

Highlights of GAO-21-387 (Continued)
GAO’s new recommendations are discussed below.
Hospital and Pharmacy Perspectives on COVID-19 Vaccine Administration and Medical Supply Availability
In February 2021, GAO surveyed hospitals and interviewed large retail pharmacy chains and an association of
independent pharmacies to gain their perspectives on vaccine administration and medical supply availability. Providers
expressed concerns about COVID-19 vaccine availability and limitations in the availability of certain key medical supplies
for administering the vaccines—notably syringes and needles. For example, representatives from one retail pharmacy
chain stated that the chain has the capacity to administer 25 million doses per month at 9,900 locations, but the chain’s
initial allocation of vaccines from the federal government was expected to be only 230,000 doses at 250 locations. Several
retail pharmacy chain representatives also indicated that limited vaccine availability has led to uncertainty regarding the
amount of vaccines their pharmacies can expect to receive each week. The new administration has taken steps to
increase certainty and vaccine availability. For example, the White House announced at the end of January 2021 that the
federal government would begin notifying states earlier about availability and shipments of vaccines, to give greater
certainty for planning vaccination efforts.
Of the 146 surveyed hospitals that plan to or have begun administering COVID-19 vaccines, 40 hospitals reported at the
time of GAO’s survey being greatly concerned about having a sufficient quantity of syringes in the next 30 days for
vaccine administration following the survey, and 43 hospitals were greatly concerned about having a sufficient quantity of
needles. Additionally, shortages of personal protective equipment (PPE) and COVID-19 testing supplies also remain a
challenge for some providers. GAO and other entities have documented persistent and evolving supply chain challenges
throughout the pandemic, such as shortages of key supplies used for COVID-19 testing. GAO will continue to examine the
medical supply chain, including the role of the Strategic National Stockpile, in future reporting, including actions to
respond to GAO’s previous recommendations.
Emergency Use Authorizations
Emergency use authorizations (EUA)—which allow for the temporary use of unapproved medical products—have been
instrumental in increasing needed supply of certain devices, such as PPE, during the COVID-19 pandemic response (see
figure). However, there have been instances of inconsistencies between EUAs issued by the Food and Drug
Administration (FDA) and device guidance from CDC and the Department of Labor (DOL), which led to confusion and
hesitancy among providers about using such devices, according to provider associations. GAO recommends that FDA,
CDC, and DOL work together to develop a process for sharing information to facilitate decision-making and
guidance consistency related to devices with EUAs. The Department of Health and Human Services (HHS)—which
includes FDA and CDC—and DOL agreed with this recommendation.
Examples of Medical Devices Other Than Tests with Emergency Use Authorizations for COVID-19

Highlights of GAO-21-387 (Continued)
In addition, stakeholders—including associations representing manufacturers, distributors, and users of authorized
devices, such as health care providers—raised concerns about what will happen to devices with EUAs after the
declarations permitting their use for COVID-19 end. HHS has indicated that it intends to develop draft guidance for a
transition plan for medical devices distributed under EUAs for COVID-19 by the end of fiscal year 2021. A plan for devices
with EUAs that specifies a reasonable timeline and process for transitioning away from their use, taking into account
stakeholder input, would help ensure a smooth transition. As HHS develops a transition plan for devices with EUAs,
GAO recommends that the agency specify a reasonable timeline and process for transitioning authorized devices
to clearance, approval, or appropriate disposition that takes into account input from stakeholders. HHS agreed
with this recommendation.
COVID-19 Data for Health Care Indicators
Since June 2020, GAO has identified concerns with federal COVID-19 data and underscored that in the midst of a
nationwide public health emergency, clear and consistent communication between the federal government and the public
is critical given that effective response requires the public’s participation. As part of its efforts to communicate with the
public and stakeholders about the pandemic, several experts suggested that the federal government should improve the
accessibility of its COVID-19 data by making these data available from a central location on the internet. HHS publishes
its data on COVID-19 health indicators across several websites. However, the data it makes publicly available are not all
located on, or available from website links on, one online location. As a result, the public, including stakeholders, may not
be able to fully understand the extent of the pandemic and use the data to best inform their decision-making.
To make the data more easily accessible, GAO recommends that HHS make its different sources of publicly
available COVID-19 data accessible from a centralized location on the internet. HHS neither agreed nor disagreed
with this recommendation, but agreed that COVID-19 data should be made accessible to support communication with the
public about the pandemic.
COVID-19 Health Disparities
GAO previously reported that communities of color have been disproportionately affected by the pandemic. According to
HHS, as of February 8, 2021, data collected from states and jurisdictions on COVID-19 vaccine recipients were missing
data on race and ethnicity for almost half of recipients. Without complete information on the race and ethnicity of those
vaccinated, HHS may have difficulty determining whether vaccines are distributed equitably to communities of color. GAO
recommends that HHS take steps to ensure the complete reporting of race and ethnicity information for
recipients of COVID-19 vaccinations. HHS neither agreed nor disagreed with this recommendation.
HHS’s July 2020 COVID-19 Response Health Equity Strategy has a goal to reduce health disparities by using data-driven
approaches to attain the highest level of health possible for all individuals, including communities of color. However, the
strategy lacks important elements of an effective national strategy. For example, HHS’s strategy does not provide specific
actions that the agency will take to determine whether or where it needs to increase access to testing for populations at
increased risk for COVID-19—an essential first step before taking steps to increase testing access. GAO recommends
that HHS incorporate key elements of a national strategy to implement the agency’s COVID-19 Response Health
Equity Strategy, including determining how intermediate outcomes should be prioritized. HHS agreed with this
recommendation.
Nursing Homes
Collecting detailed information on vaccinations for nursing home populations is important for tracking and transparency,
particularly because nursing homes have been an epicenter of the COVID-19 pandemic and HHS has recommended
priority vaccinations for this group. HHS established a pharmacy partnership program for vaccinating staff and residents of
long-term care facilities, and publicly reports the number of vaccination doses, by state, provided to residents and staff of
all long-term care facilities participating in the program. However, HHS does not report data showing vaccination rates
specifically for nursing homes and does not collect or report data for nursing homes not participating in the program. To
improve the monitoring and transparency of nursing home vaccination efforts, GAO recommends that HHS
collect data specific to COVID-19 vaccination rates in nursing homes and make these data publicly available.
HHS neither agreed nor disagreed with this recommendation.
In addition, as of January 2021, HHS had not specified whether nursing homes would be required to offer COVID-19
vaccinations as they have with other vaccines and how these vaccinations would be incorporated into the agency’s
nursing home quality strategy. Data on COVID-19 vaccinations in nursing homes will also be important for HHS’s ongoing
efforts to monitor nursing home quality. GAO recommends that HHS require nursing homes to offer COVID-19
vaccinations to residents and staff and design and implement associated quality measures. HHS neither agreed
nor disagreed with this recommendation.

Highlights of GAO-21-387 (Continued)
Veterans Health Care
According to the Department of Veterans Affairs (VA), many veterans enrolled in VA’s health care system are at a higher
risk of infection or severe disease from COVID-19 due to their age or underlying health conditions. GAO identified several
areas where VA can improve its vaccination efforts:
•
VA does not have metrics related to staff and veterans who do not show (no-shows) for their vaccination
appointments. Without data on no-shows, VA may be at risk for not being able to determine the extent to which staff
and veterans are not showing up for appointments for their second vaccinations, and may miss opportunities to better
target outreach to individuals not showing up for appointments.
•
VA lacks targets for when it will move from one vaccination phase to another or within one phase for when the agency
will move from one group of veterans to another, making it difficult for the department to assess progress.
•
VA is utilizing a phased vaccine rollout; however, VA’s current metrics do not capture vaccine data by phases. As a
result, VA is not able to determine which facilities may be at an earlier phase than others and direct resources or
assistance to those facilities.
GAO recommends that VA (1) collect data on the number of staff and veterans who do not show up for a
vaccination appointment to better monitor for completion of the second dose of the vaccine; (2) develop
preliminary vaccination targets for when it will move from one vaccination phase to another; or within one phase,
from one group of veterans to another; and (3) develop metrics to assess the number of vaccines administered
by vaccine rollout phase to better assess progress and make any necessary adjustments. VA agreed with the first
and third recommendations and agreed in principle with the second recommendation.
Nutrition Assistance
The U.S. Department of Agriculture (USDA) administers a number of federal nutrition assistance programs to vulnerable
populations. Recent legislative and executive actions made several changes to these programs as the negative economic
effects of the COVID-19 pandemic have continued. However, until recently, USDA had released minimal data about
participation in these programs during the pandemic, and when the department released data in late January 2021, it did
not publicly share sufficient information about data quality. In August 2020, USDA announced it had identified significant
issues with the quality of state-reported data on two programs. As it worked to identify the root causes of the issues,
USDA opted not to release participation data for any of its other nutrition assistance programs from July 2020 until late
January 2021. When USDA released the data, the department did not explain how it resolved the data quality issues it
previously disclosed, nor did it share necessary context to help stakeholders and the public understand and interpret the
data.
As a result, stakeholders and the public lack sufficient information and appropriate context to interpret key program data
and understand the effects of the pandemic on the programs. GAO recommends that USDA (1) provide sufficient
context to help stakeholders and the public understand and interpret data on federal nutrition assistance
programs during the pandemic and (2) disclose potential sources of error that may affect data quality during the
pandemic, such as manual processing. USDA generally agreed with these recommendations.
Disaster Relief Fund and Assistance to Tribal Governments
Available data from HHS indicate that tribes are among communities of color bearing a disproportionate burden of
COVID-19 positive tests, cases, hospitalizations, and deaths. The Federal Emergency Management Agency (FEMA),
within the Department of Homeland Security (DHS), plays a key role in the ongoing COVID-19 pandemic response effort,
including using the Disaster Relief Fund to provide Public Assistance grants to reimburse tribal governments, among
others, for pandemic costs, such as testing supplies, PPE, and vaccine distribution.
Several tribal organizations reported challenges related to completing administrative requirements to request and receive
Public Assistance. For example, two tribal officials told GAO that when requesting technical assistance from FEMA to help
with disaster activities such as developing a Public Assistance Administrative Plan, FEMA did not have staff to assist.
FEMA’s initial assessment report of its response to the pandemic noted challenges and recommended that FEMA develop
a tribal nation engagement strategy that includes providing the resources and personnel throughout each region required
to support program delivery for all tribal nations. However, as of March 2021, FEMA had not developed this strategy.
GAO recommends that FEMA provide timely and consistent technical assistance to support tribal governments’
efforts to request and receive Public Assistance as direct recipients, including providing additional personnel, if
necessary, to ensure that tribal nations are able to effectively respond to COVID-19. DHS agreed with this
recommendation.
FEMA’s 2019 Tribal Consultation Policy specifies the process for consulting with tribes throughout the four phases that
guide the agency in how to conduct regular and meaningful collaboration with tribes (see figure). However, GAO found
that FEMA did not follow the tribal consultation process while developing an interim policy detailing eligible items for

Highlights of GAO-21-387 (Continued)
reimbursement under the Public Assistance program. If tribes had been formally consulted earlier in the process, they
could have been in a better position to provide meaningful input to FEMA on how its policy might impact tribes. Further,
there may have been less confusion on which items were considered eligible for reimbursement during the early months
of the pandemic, and tribes could have made more informed decisions. GAO recommends that FEMA adhere to the
agency’s protocols listed in the updated 2019 Tribal Consultation Policy by obtaining tribal input via the four
phases of the tribal consultation process when developing new policies and procedures related to COVID-19
assistance. DHS agreed with this recommendation.
Overview of FEMA’s Tribal Consultation Policy Process
K-12 Education
The Department of Education (Education) has taken steps to track state and school district spending of certain COVID-19
relief funds, but the data give an incomplete picture of the status of funds and understate the rate at which funds are being
used. According to data collected by Education, as of February 28, 2021, states and territories have spent about $6.1
billion of the approximately $75 billion appropriated through the Education Stabilization Fund for states’ and territories’
education needs. However, federal spending data alone provide an incomplete picture of states’ and school districts’
spending, as there are several factors that influence the rate at which funds appear to be spent. For example, there is
often a significant gap between when a district “uses” the funds (i.e., orders, contracts for, installs, and pays for goods or
services, such as information technology equipment) and when those funds are reported as “spent” in state and federal
reporting systems, as is common in federal grants management processes.
According to Education officials, states award applicable funds to school districts so that the school districts can obligate
those funds for specific purposes. The state does not transfer funds to the district until the district requests payment for
services or deliverables received. Education officials do not consider the funds spent until the state requests payment for
expenses. Given this gap between when a district uses funds and funds are recorded as spent, absent information on
obligations, policymakers will not have complete information on how these funds are being used to address the pandemic-
related education needs of America’s schoolchildren. GAO recommends that Education regularly collect and publicly
report information on school districts’ financial commitments (obligations), as well as outlays (expenditures) in
order to more completely reflect the status of their use of federal COVID-19 relief funds. For example, Education
could modify its annual report on state and school district spending data to include obligations data in
subsequent reporting cycles. Education agreed with this recommendation.
Small Business Assistance Programs
The Consolidated Appropriations Act, 2021, appropriated additional funding for the creation of the Targeted Economic
Injury Disaster Loan (EIDL) Advance program and authorized additional Paycheck Protection Program (PPP) loans,
among other things, highlighting the continued need for ensuring program integrity. Since March 2020, the Department of
Justice has publicly announced charges in numerous fraud-related cases associated with loans made through these
programs. As a result of concerns about program integrity, GAO has added Small Business Administration (SBA) loans to
GAO’s High Risk List. SBA has taken some steps to mitigate fraud risks to EIDL and PPP, but it has not taken a strategic
approach to managing fraud risks to both programs. GAO recommends that SBA (1) implement a comprehensive
oversight plan to identify and respond to risk in the EIDL program to ensure program integrity, achieve program
effectiveness, and address potential fraud; (2) conduct and document a fraud risk assessment for the EIDL
program and PPP; (3) develop a strategy that outlines specific actions to address assessed fraud risks in the
EIDL program; and (4) outline specific actions to monitor and manage fraud risks in PPP on a continuous basis.
SBA agreed with these recommendations.
Unemployment Insurance Programs
GAO continues to have concerns about overpayments and potential fraud in the unemployment insurance (UI) system,
including the federally funded Pandemic Unemployment Assistance (PUA) program, which authorizes UI benefits to
certain individuals not otherwise eligible for these benefits, such as self-employed and certain gig economy workers. As of

Highlights of GAO-21-387 (Continued)
March 15, 2021, DOL reported that states had identified more than $3.6 billion in PUA overpayments from March 2020
through February 2021. In response to a recommendation in GAO’s January 2021 report, DOL has taken steps to collect
data on states’ recovery of PUA overpayments. However, the Consolidated Appropriations Act, 2021, enacted in
December 2020, provided states with authority to waive certain PUA overpayments. Thus, additional data on the amounts
of PUA overpayments states have waived are also needed to effectively monitor the recovery of overpayments. GAO
recommends that DOL collect data from states on the amount of overpayments waived in the PUA program,
similar to the regular UI program. DOL agreed with this recommendation.
This report contains additional recommendations related to transparency and accountability in the following areas: relief
for health care providers, economic impact payments, federal contracts and agreements, audits of nonfederal entities
receiving federal pandemic assistance, and employer tax relief and payroll tax deferrals.
GAO is also examining the federal government’s COVID-19 vaccine efforts, which will be the focus of an upcoming report.
Finally, GAO will review actions federal agencies have taken in response to the American Rescue Plan of 2021 in future
reporting.

Contents
Recommendations for Executive Action................................................................................ 1
Introduction................................................................................................................................. 5
Background.................................................................................................................................... 8
Public Health and Economic Eﬀects.................................................................................................. 8
Federal COVID-19 Funding and Spending........................................................................................ 11
Key Principles for an Eﬀective Federal Response.............................................................................. 15
Executive Summary................................................................................................................... 16
Overview..................................................................................................................................... 16
Hospital and Pharmacy Perspectives on COVID-19 Vaccine Administration and Medical Supply
Availability................................................................................................................................... 16
SNS and Medical Supply Chain...................................................................................................... 17
Funding for COVID-19 Testing........................................................................................................ 19
Emergency Use Authorizations...................................................................................................... 19
COVID-19 Data for Health Care Indicators....................................................................................... 20
COVID-19 Health Disparities.......................................................................................................... 21
Relief for Health Care Providers..................................................................................................... 22
Nursing Homes............................................................................................................................ 22
Veterans Health Care.................................................................................................................... 23
Nutrition Assistance..................................................................................................................... 24
Disaster Relief Fund and Assistance to Tribal Governments............................................................... 25
K-12 Education............................................................................................................................ 27
Economic Impact Payments........................................................................................................... 28
Economic Injury Disaster Loan Program and Paycheck Protection Program.......................................... 29
Unemployment Insurance Programs............................................................................................... 30
Federal Contracts and Agreements for the COVID-19 Response.......................................................... 32
Single Audits............................................................................................................................... 33
Employer Tax Relief and Payroll Tax Deferrals.................................................................................. 34
Conclusions.................................................................................................................................. 36
Closing........................................................................................................................................... 37
Congressional Addressees....................................................................................................... 38
Appendixes and Enclosures..................................................................................................... 40
Appendix I: Enclosures.................................................................................................................. 40
Health Care Indicators.................................................................................................................. 40
Economic Indicators..................................................................................................................... 48
Page i
GAO-21-387

Relief for Health Care Providers..................................................................................................... 58
Nursing Homes............................................................................................................................ 66
Strategic National Stockpile and the Medical Supply Chain................................................................ 80
Funding for COVID-19 Testing........................................................................................................ 90
Medicaid Enrollment, Spending, and Flexibilities............................................................................... 98
Veterans Health Care.................................................................................................................. 109
Military Personnel Vaccinations.................................................................................................... 121
Defense Support of Civil Authorities............................................................................................. 127
HHS COVID-19 Funding............................................................................................................... 136
Domestic Medical Product Manufacturing..................................................................................... 143
Emergency Use Authorizations for Medical Devices........................................................................ 152
COVID-19 Cyber Response.......................................................................................................... 166
Telecommunications Funding for Telehealth.................................................................................. 170
Hospital and Pharmacy Perspectives on COVID-19 Vaccine Administration and Medical Supply
Availability................................................................................................................................. 177
Health Disparities....................................................................................................................... 195
Defense Production Act.............................................................................................................. 205
Federal Contracts and Agreements for COVID-19............................................................................ 215
Unemployment Insurance Programs............................................................................................. 227
Economic Impact Payments......................................................................................................... 245
Nutrition Assistance................................................................................................................... 256
Child Nutrition........................................................................................................................... 267
Employer Tax Relief and Payroll Tax Deferrals................................................................................ 274
Community Services Block Grant................................................................................................. 290
Economic Injury Disaster Loan Program........................................................................................ 296
Paycheck Protection Program...................................................................................................... 306
Federal Reserve Lending Facilities................................................................................................ 317
Loans for Aviation and Other Eligible Businesses........................................................................... 323
Payroll Support Assistance to Aviation Businesses.......................................................................... 328
Amtrak Grants........................................................................................................................... 333
Assistance for Fishery Participants............................................................................................... 339
Tax Relief for Businesses............................................................................................................. 348
FEMA’s Disaster Relief Fund and Assistance to Tribal Governments................................................... 356
K-12 Education.......................................................................................................................... 367
Transit Industry.......................................................................................................................... 377
Airport Grants.......................................................................................................................... 382
International Trade..................................................................................................................... 391
International Humanitarian Assistance.......................................................................................... 395
Bureau of Prisons’ COVID-19 Spending and Response..................................................................... 404
Reporting of COVID-19 Supplemental Spending Data...................................................................... 408
Federal Fraud-Related Cases........................................................................................................ 417
Agriculture Spending on Payments to Producers............................................................................ 425
Agriculture Spending on Food Purchases...................................................................................... 431
Page ii
GAO-21-387

Single Audits............................................................................................................................. 438
Federal Food Safety Inspections and Inspectors’ Exposure to COVID-19............................................. 445
Appendix II: List of Ongoing GAO Work Related to COVID-19, as of March 17, 2021.............................. 449
Appendix III: Status of Our Matters for Congressional Consideration and Recommendations for Executive
Action as of March 2021............................................................................................................. 454
Appendix IV: Comments from the Department of Education............................................................ 474
Appendix V: Comments from the Federal Communications Commission............................................ 477
Appendix VI: Comments from the Department of Health and Human Services.................................... 479
Appendix VII: Comments from the Department of Homeland Security............................................... 488
Appendix VIII: Comments from the Internal Revenue Service........................................................... 492
Appendix IX: Comments from the Department of Labor.................................................................. 496
Appendix X: Comments from the Small Business Administration...................................................... 498
Appendix XI: Comments from the United States Agency for International Development....................... 500
Appendix XII: Comments from the Department of Veterans Aﬀairs................................................... 501
Contacts..................................................................................................................................... 507
Tables
Table 1: COVID-19 Relief Appropriations, Obligations, and Expenditures, as of January 31, 2021............... 14
Summary of the Provider Relief Fund ($178 billion) Allocations and Disbursements, as of March 1,
2021........................................................................................................................................... 60
Key Dates in Roll Out of Vaccinations for Nursing Homes.................................................................. 72
COVID-19 Vaccinations Conducted in Nursing Homes through the Pharmacy Partnership for Long-Term Care
Program by Recipient Type, as of February 11, 2021......................................................................... 75
Strategic National Stockpile Personal Protective Equipment Inventory................................................. 87
Obligations and Expenditures of Federal Funding for Testing-Related COVID-19 Response Activities Provided
to States, Localities, and Territories through the Epidemiology and Laboratory Capacity for Prevention and
Control of Emerging Infectious Diseases (ELC) program, as of February 28, 2021................................... 94
Federal Medicaid COVID-19 and Total Expenditures, by State and Territory, as of February 28, 2021....... 103
Common Types of State Flexibilities Approved by Centers for Medicare & Medicaid Services since March 16,
2020......................................................................................................................................... 106
Veterans Health Administration (VHA) COVID-19 Vaccination Phases and Prioritization, December 14,
2020......................................................................................................................................... 112
Administration of vaccine to veterans aged 65 and older by race as of March 11, 2021......................... 117
Administration of vaccine to veterans aged 65 and older by ethnicity as of March 11, 2021................... 118
Number of Cumulative, Conﬁrmed Cases of COVID-19, Hospitalizations, and Deaths Reported by the
Department of Defense (DOD), as of March 10, 2021...................................................................... 122
Department of Defense (DOD) COVID-19 Vaccine Prioritization for Military Servicemembers, Other
Beneﬁciaries, Civilian Employees, and Contractors.......................................................................... 123
Department of Defense (DOD) Accounts That Received CARES Act Appropriations Transferred from National
Guard Accounts......................................................................................................................... 130
Page iii
GAO-21-387

Appropriations to HHS for COVID-19 Response from the Five COVID-19 Relief Laws Enacted as of January 1,
2021......................................................................................................................................... 137
Department of Health and Human Services-Reported COVID-19 Relief Appropriations, Obligations, and
Expenditures from Five COVID-19 Relief Laws, by Agency or Key Fund, as of February 28, 2021.............. 139
Department of Health and Human Services-Reported Allocations, Obligations, and Expenditures of COVID-19
Relief Funds from ﬁve COVID-19 Relief Laws, by Selected Key Response Activity, as of February 28,
2021......................................................................................................................................... 141
Number of Emergency Use Authorizations (EUA) Issued and Reissued for Individual Devices by Device
Category for COVID-19, as of March 10, 2021................................................................................ 157
Umbrella Emergency Use Authorizations (EUA), Reissuances, Revocations, and Number of Authorized
Manufacturers and Device Models for COVID-19, as of March 10, 2021.............................................. 159
Purposes for the 539 COVID-19 Telehealth Awards Issued by the Federal Communications
Commission.............................................................................................................................. 175
Surveyed Hospitals’ Most Commonly Cited Concerns about Capacity to Administer Vaccines in February
2021......................................................................................................................................... 185
Hospital Survey Sample Size, Characteristics, and Response Rates.................................................... 193
Medical Supply Domestic Production Expansion Projects, through February 2021............................... 209
Key Information on Federal Nutrition Assistance Programs during the COVID-19 Pandemic, as of January 31,
2021......................................................................................................................................... 258
Selected Changes to the Employee Retention Credit in the Consolidated Appropriations Act, 2021......... 277
Number and Amount of Families First Coronavirus Response Act Paid Leave Credits and Employee Retention
Credits Claimed in Employers’ Tax Filings...................................................................................... 281
Small Business Pulse Survey’s Estimated Percentage of Small Businesses Receiving Paid Leave Credits and
Employee Retention Credits, by Industry, as of January 10, 2021....................................................... 286
Small Business Administration (SBA) and Contractor Reviews of Paycheck Protection Program Loans..... 310
Federal Reserve Lending Facilities without CARES Act Funding......................................................... 321
Loans for the CARES Act Loan Program for Aviation and Other Eligible Businesses.............................. 324
Application Outcomes for the CARES Act Loan Program for Aviation and Other Eligible Businesses........ 327
Department of Commerce’s Allocation of CARES Act Funding for States, Tribes, and Territories with Fishery
Participants on May 7, 2020........................................................................................................ 341
Disbursement of CARES Act Funding, as of February 1, 2021............................................................ 344
CARES Act Net Operating Loss (NOL) Carryback and Alternative Minimum Tax (AMT) Credit Tentative Refund
E-fax Cases, as of December 31, 2020.......................................................................................... 352
Number and Approval Rate of CARES Act Applications for Tentative Refunds Received on Forms 1139 and
1045 via E-fax, by Refund Amount, as of December 31, 2020........................................................... 353
Transit Agency Obligations of CARES Act Grant Funds by Expense Category in Urban, Rural, and Tribal Areas,
as of February 28, 2021.............................................................................................................. 379
Transit Industry Allocations and Obligations by Program under the Consolidated Appropriations Act, 2021, as
of February 28, 2021.................................................................................................................. 380
CARES Act Airport Grants............................................................................................................ 383
Consolidated Appropriations Act, 2021, Airport Grants.................................................................... 385
FAA Obligations and Expenditures for CARES Act Airport Grants by Funding Group, as of February 14,
2021......................................................................................................................................... 388
Page iv
GAO-21-387

USAID Supplemental International Disaster Assistance Obligations, by Programming Sector................. 399
Federal Agency Websites Reporting Government-wide COVID-19 Spending Data................................. 410
Apportioned Amounts and Funding Sources for the Coronavirus Food Assistance Program (CFAP) Direct
Payments to Agricultural Producers as of January 19, 2021.............................................................. 427
Potential Amounts and Funding Sources for the Paycheck Protection Program (PPP) Loans to Agricultural
Producers, as of February 5, 2021................................................................................................ 428
Average Contract Award per Contractor for the Farmers to Families Food Box Program, by Round, as of
February 2, 2021........................................................................................................................ 434
Range in Cost for Combination Food Boxes for the Farmers to Families Food Box Program, by Round, as of
February 2, 2021........................................................................................................................ 436
Figures
Higher-Than-Expected Weekly Mortality in the U.S., February 2020 through Mid-February 2021................H1
Examples of Medical Devices Other Than Tests with Emergency Use Authorizations for COVID-19.............H3
Overview of FEMA’s Tribal Consultation Policy Process...................................................................... .H6
Figure 1: Report Enclosures by Topic Area......................................................................................... 7
Figure 2: Reported COVID-19 Cases per Day in the U.S., through March 10, 2021.................................... 8
Figure 3: Higher-Than-Expected Weekly Mortality, February 2020 through mid-February 2021................... 9
Figure 4: Daily Count of Doses of COVID-19 Vaccine Administered and Reported to CDC, through March 10
2021........................................................................................................................................... 10
Figure 5: Employment Remains below Its Pre-pandemic Level, as of February 2021............................... 11
Figure 6: Percentage Change in Employment by Sector, February 2020–February 2021........................... 11
Figure 7: COVID-19 Relief Laws Enacted, as of March 11, 2021............................................................ 12
Indicators for Areas of the Economy Supported by the Federal COVID-19 Pandemic Response, November
2020 through February 2021, Cumulative Changes since February 2020.............................................. 49
Weekly Economic Index, January 2019 through February 2021........................................................... 50
Percentage Change in Employment by Sector, February 2020 through February 2021............................ 52
Change in Employment-to-Population Ratio by Race and Ethnicity, February 2020 through February
2021........................................................................................................................................... 52
Serious Delinquency Rates on Single-Family Residential Mortgages, January 2019 through January
2021........................................................................................................................................... 53
Changes in the Small Business Credit Card Delinquency Index by Sector, February 2020 through January
2021........................................................................................................................................... 54
Spreads on Investment Grade Corporate Bonds, January 2019 through February 2021.......................... 55
State and Local Government Tax Revenue, First Quarter 2019 through Third Quarter 2020..................... 56
State and Local Government Employment, January 2019 through February 2021.................................. 57
New Weekly Conﬁrmed COVID-19 Cases and Deaths among U.S. Nursing Home Residents and Staﬀ, as
Reported by Medicare- and Medicaid-Certiﬁed Nursing Homes, Weeks Ending May 31, 2020, through
February 7, 2021.......................................................................................................................... 70
Timeline of Selected Federal Funding Availability to States, Localities, Territories, and Tribal Organizations
Used to Support Coronavirus Testing.............................................................................................. 95
Medicaid Enrollment from October 2019 through September 2020, Preliminary and Updated Data........ 100
Page v
GAO-21-387

Centers for Medicare & Medicaid Services Guideline for States Resuming Timely Medicaid Eligibility and
Enrollment Actions..................................................................................................................... 101
Department of Veterans Aﬀairs COVID-19 Vaccine Administration, as of March 10, 2021...................... 114
Vaccine Doses Received by Department of Defense Vaccination Sites and Administered to Individuals as of
March 10, 2021.......................................................................................................................... 124
State and Federal Command Relationship Regarding Defense Support of Civil Authorities.................... 128
CARES Act Appropriations to the National Guard and Subsequent Transfers from the National Guard to
Other DOD Accounts, Fiscal Year 2020.......................................................................................... 129
Department of Defense (DOD) Personnel Supporting Civil Authorities’ COVID-19 Response, March 2020
through February 2021............................................................................................................... 132
Department of Defense Personnel Provide COVID-19 Vaccination Support in Los Angeles, California (March
2021)........................................................................................................................................ 133
Mississippi National Guard Members Supporting COVID-19 Testing throughout the State in 2020.......... 134
HHS’s Reported COVID-19 Relief Appropriations, Obligations, and Expenditures from COVID-19 Relief Laws,
as of February 28, 2021.............................................................................................................. 138
Selected Federal Entities Involved in the Coordination of Domestic Manufacturing Capacity Eﬀorts in
Response to the COVID-19 Pandemic........................................................................................... 147
Examples of Medical Devices Used for COVID-19............................................................................ 154
Total COVID-19 Telehealth Funding Awarded by the Federal Communications Commission and Number of
Awardees, by State..................................................................................................................... 174
Examples of COVID-19 Vaccine Administration Supplies.................................................................. 180
Examples of Personal Protective Equipment.................................................................................. 181
Examples of COVID-19 Testing Supplies........................................................................................ 181
Surveyed Hospitals’ 7-Day Supply Levels of Selected Personal Protective Equipment (PPE).................... 188
Surveyed Hospitals’ Levels of Conﬁdence in Having Adequate Personal Protective Equipment (PPE) Supplies
for the Next 30 Days.................................................................................................................. 190
Surveyed Hospitals’ Levels of Conﬁdence in Having Adequate Testing Supplies for the Next 15 Days...... 191
Priority-Rated Actions by Supply Type, March 2020–February 2021................................................... 207
Contract Obligations in Response to COVID-19 by Federal Agency, as of February 28, 2021................... 218
Government-wide Contract Obligations Related to COVID-19 by Week, February 2020–February 2021.... 219
Contract Obligation Amounts for Goods and Services Most Procured in Response to COVID-19, as of
February 28, 2021...................................................................................................................... 220
Weekly Initial Claims Submitted Nationwide for Regular Unemployment Insurance (UI) and Pandemic
Unemployment Assistance (PUA) Beneﬁts, March 1, 2020 through March 13, 2021.............................. 232
Weekly Continued Claims Submitted Nationwide for Pandemic Emergency Unemployment Compensation
(PEUC) Beneﬁts, March 1, 2020 through February 27, 2021.............................................................. 234
Timeliness of First Payments of Regular Unemployment Insurance (UI) Beneﬁts, January 2020 through
January 2021............................................................................................................................. 236
Total Federal Loan Balance Held by States and Territories to Pay Unemployment Insurance (UI) Beneﬁts,
January 3, 2020 through March 12, 2021....................................................................................... 239
Number of Economic Impact Payments (EIP) Disbursed by Payment Type, Rounds 1 and 2, as of February 5,
2021......................................................................................................................................... 248
Non-ﬁler and Unbanked Rates by Race and Ethnicity in 2019........................................................... 253
Page vi
GAO-21-387

Total Meals Served Per Month in Key Child Nutrition Programs, March through September 2019 and
2020......................................................................................................................................... 270
Community Services Block Grant (CSBG) Flexibilities during the COVID-19 Pandemic, as of March 2021... 292
Cumulative Transaction Volume of Federal Reserve Lending Facilities Supported by CARES Act Funding, May
2020–January 2021..................................................................................................................... 319
Timing and Anticipated Award Amounts for Treasury’s Payroll Support Program Extension (PSP2), by Type of
Recipient, as of March 10, 2020................................................................................................... 330
Amtrak Ridership Actuals and Forecast, October 2018–September 2021............................................ 336
Percentage of Obligated CARES Act Funds That Have Been Disbursed to Fishery Participants by the Interstate
Fisheries Commissions, as of February 1, 2021.............................................................................. 345
FEMA Disaster Relief Fund Balance by Month, February 2020 through February 2021.......................... 358
Disaster Relief Fund Obligations and Projections for COVID-19 by Program and Activity through March
2021......................................................................................................................................... 359
Overview of FEMA’s Tribal Consultation Policy Process.................................................................... 362
Ratio of FEMA Tribal Relations Personnel to Tribal Nations by FEMA Region as of February 2021............ 364
Federal COVID-19 Relief for States and Territories Provided through Education Stabilization Funds and
Amount Spent, as of February 28, 2021........................................................................................ 370
Examples of Key Milestones in the Funding Stream for the Education Stabilization Fund...................... 372
Department of Education Transparency Portal Main Page, as of February 26, 2021.............................. 374
Monthly U.S. Imports of COVID-19-Related Products by Product Type, January 2018 to December 2020.. 392
Timing of State Approval and Obligation of Supplemental Humanitarian COVID-Response Funding........ 396
Timing of USAID Approval and Obligation of Supplemental Humanitarian COVID-Response Funding...... 398
Number of Individuals Facing Federal Charges or Who Have Pleaded Guilty to Fraud-Related Charges by
COVID-19 Relief Program, as of January 31, 2021............................................................................ 420
Number of Individuals or Entities Who Have Pleaded Guilty to or Faced Federal Charges for Consumer Fraud,
as of January 31, 2021................................................................................................................ 422
Examples of Consumer Warnings about COVID-19 Vaccine Scams.................................................... 423
Contribution of Federal Direct Payments and Net Crop Insurance Payments to Net Farm Income, 2008–2021,
Adjusted for Inﬂation, as of February 5, 2021................................................................................ 429
Funding Amounts, Obligations and Purchases (Expenditures) for the Farmers to Families Food Box Program,
as of January 31, 2021................................................................................................................ 432
Contractors Participating in the Farmers to Families Food Box Program across the Rounds, as of February 2,
2021......................................................................................................................................... 433
Figure 8: Status of Prior GAO Recommendations by Department or Agency....................................... 454
Page vii
GAO-21-387

Abbreviations
CDC
Centers for Disease Control and Prevention
CMS
Centers for Medicare & Medicaid Services
COVID-19
Coronavirus Disease 2019
DHS
Department of Homeland Security
DOD
Department of Defense
DOJ
Department of Justice
DOL
Department of Labor
Education
Department of Education
EIDL
Economic Injury Disaster Loan
EIP
economic impact payment
EUA
emergency use authorization
FDA
Food and Drug Administration
FEMA
Federal Emergency Management Agency
GTAS
Governmentwide Treasury Account Symbol Adjusted Trial Balance
System
HHS
Department of Health and Human Services
IRS
Internal Revenue Service
NIA
National Interest Action
OIG
Office of Inspector General
OMB
Office of Management and Budget
OSHA
Occupational Safety and Health Administration
PPE
personal protective equipment
PPP
Paycheck Protection Program
PRF
Provider Relief Fund
PUA
Pandemic Unemployment Assistance
SBA
Small Business Administration
SNAP
Supplemental Nutrition Assistance Program
SNS
Strategic National Stockpile
Treasury
Department of the Treasury
TSA
Transportation Security Administration
UI
unemployment insurance
USDA
U.S. Department of Agriculture
VA
Department of Veterans Affairs
Page viii
GAO-21-387

GAO’s Mission
The Government Accountability Oﬃce, the audit, evaluation, and investigative arm of Congress, exists
to support Congress in meeting its constitutional responsibilities and to help improve the performance
and accountability of the federal government for the American people. GAO examines the use of public
funds; evaluates federal programs and policies; and provides analyses, recommendations, and other
assistance to help Congress make informed oversight, policy, and funding decisions. GAO’s commitment
to good government is reﬂected in its core values of accountability, integrity, and reliability.
Copyright
This is a work of the U.S. government and is not subject to copyright protection in the United States. The
published product may be reproduced and distributed in its entirety without further permission from
GAO. However, because this work may contain copyrighted images or other material, permission from
the copyright holder may be necessary if you wish to reproduce this material separately.
Page ix
GAO-21-387

Recommendations for Executive Action
Recommendations for Executive Actions
We are making a total of 28 recommendations to federal agencies:
•
The Secretary of Health and Human Services should make the Department’s diﬀerent
sources of publicly available COVID-19 data accessible from a centralized location on the
internet. This could improve the federal government’s communication with the public
about the ongoing pandemic. See Health Care Indicators enclosure. (Recommendation 1)
•
The Secretary of Health and Human Services should ﬁnalize and implement a post-
payment review process to validate COVID-19 Uninsured Program claims and to help
ensure timely identiﬁcation of improper payments, including those resulting from
potential fraudulent activity, and recovery of overpayments. See Relief for Health Care
Providers enclosure. (Recommendation 2)
•
The Secretary of Health and Human Services should ensure that the Director of the
Centers for Disease Control and Prevention collects data speciﬁc to the COVID-19
vaccination rates in nursing homes and makes these data publicly available to better
ensure transparency and that the necessary information is available to improve ongoing
and future vaccination eﬀorts for nursing home residents and staﬀ. See Nursing Homes
enclosure. (Recommendation 3)
•
The Secretary of Health and Human Services should ensure that the Administrator
of the Centers for Medicare & Medicaid Services, in consultation with the Centers for
Disease Control and Prevention, requires nursing homes to oﬀer COVID-19 vaccinations to
residents and staﬀ and design and implement associated quality measures. See Nursing
Homes enclosure. (Recommendation 4)
•
The Department of Veterans Aﬀairs Under Secretary for Health should develop metrics
to assess the number of vaccines administered by vaccine rollout phase to better assess
progress and make any necessary adjustments as needed. See Veterans Health Care
enclosure. (Recommendation 5)
•
The Department of Veterans Aﬀairs Under Secretary for Health should develop preliminary
vaccination targets for when it will move from one vaccination phase to another; or within
one phase, from one group of veterans to another. See Veterans Health Care enclosure.
(Recommendation 6)
•
The Department of Veterans Aﬀairs Under Secretary for Health should collect data on
the number of staﬀ and veterans who do not show up for a vaccination appointment to
better monitor for completion of the second dose of the vaccine. See Veterans Health Care
enclosure. (Recommendation 7)
•
The Secretary of Health and Human Services should ensure that the Food and Drug
Administration and the Centers for Disease Control and Prevention work with the Assistant
Secretary of Labor for Occupational Safety and Health to develop a process for sharing
information to facilitate decision-making and guidance consistency related to devices with
emergency use authorization. See Emergency Use Authorizations for Medical Devices
enclosure. (Recommendation 8)
•
The Assistant Secretary of Labor for Occupational Safety and Health should work with
the Food and Drug Administration and the Centers for Disease Control and Prevention
to develop a process for sharing information to facilitate decision-making and guidance
consistency related to devices with emergency use authorization. See Emergency Use
Authorizations for Medical Devices enclosure. (Recommendation 9)
Page 1
GAO-21-387

•
As the Food and Drug Administration develops a transition plan for devices with
emergency use authorizations, the Commissioner should specify a reasonable timeline
and process for transitioning authorized devices to clearance, approval, or appropriate
disposition that takes into account input from stakeholders. See Emergency Use
Authorizations for Medical Devices enclosure. (Recommendation 10)
•
The Director of the Centers for Disease Control and Prevention should incorporate key
elements of a national strategy in the agency’s COVID-19 Response Health Equity Strategy.
These elements include (1) speciﬁc actions to achieve intermediate outcomes, such as
increased access to testing; (2) how intermediate outcomes should be prioritized within
its four broad priority areas; (3) who will implement actions to achieve intermediate
outcomes; and (4) how the strategy relates to other relevant strategies. See Health
Disparities enclosure. (Recommendation 11)
•
The Director of the Centers for Disease Control and Prevention should take steps to ensure
more complete reporting of race and ethnicity information for recipients of COVID-19
vaccinations, such as working with states and jurisdictions to facilitate consistent collecting
and reporting of this information. See Health Disparities enclosure. (Recommendation 12)
•
The Secretary of Agriculture should direct the Administrator of the Agricultural Marketing
Service to issue guidance—such as an acquisition alert or a reminder to contracting
oﬃcials—on the use of the COVID-19 National Interest Action code for the Farmers to
Families Food Box Program or successor food distribution program to ensure it accurately
captures COVID-19-related contract obligations in support of the program. See Federal
Contracts and Agreements for COVID-19 enclosure. (Recommendation 13)
•
The Secretary of Agriculture should direct the Administrator of the Agricultural Marketing
Service to assess the contracting personnel needed to fully execute the award and
administration of existing contracts in support of the Farmers to Families Food Box
Program or successor future food distribution program, and take the necessary steps
to ensure it has adequate contracting staﬀ in place to award and administer any future
contracts for the program. See Federal Contracts and Agreements for COVID-19 enclosure.
(Recommendation 14)
•
The Secretary of Labor should ensure the Oﬃce of Unemployment Insurance collects
data from states on the amount of overpayments waived in the Pandemic Unemployment
Assistance program, similar to the regular unemployment insurance program. See
Unemployment Insurance Programs enclosure. (Recommendation 15)
•
The Commissioner of Internal Revenue should periodically review control activities for
issuing direct payments to individuals to determine that the activities are designed and
implemented appropriately as IRS disburses a third round of Economic Impact Payments
and prepares for advance payments on the Child Tax Credit. These control activities should
include appropriate testing procedures, quality assurance reviews, and processes that
ensure payments distributed by tax partners reach the intended recipients. See Economic
Impact Payments enclosure. (Recommendation 16)
•
The Secretary of Agriculture should ensure that the Administrator of the Food and
Nutrition Service (1) provides suﬃcient context to help stakeholders and the public
understand and interpret data on federal nutrition assistance programs during the
pandemic and (2) discloses potential sources of error that may aﬀect data quality during
the pandemic, such as manual processing. For example, the agency could publish key
information from its internal communications plan that it developed for the January 2021
Page 2
GAO-21-387

data release and include additional table notes in subsequent data releases to help explain
these issues. See Nutrition Assistance enclosure. (Recommendation 17)
•
The Commissioner of Internal Revenue should leverage employee counts from Form
941, Employer’s Quarterly Federal Tax Return, and Form 943, Employer’s Annual Federal Tax
Return for Agricultural Employees, to identify potentially ineligible COVID-19 related sick and
family leave credit claims, and address discrepancies the Internal Revenue Service deems
signiﬁcant. See Employer Tax Relief and Payroll Tax Deferrals enclosure. (Recommendation
18)
•
The Commissioner of Internal Revenue should conduct outreach to employment tax
return ﬁlers to educate and promote accurate reporting of employee counts on Form 941,
Employer’s Quarterly Federal Tax Return, and Form 943, Employer’s Annual Federal Tax Return
for Agricultural Employees. See See Employer Tax Relief and Payroll Tax Deferrals enclosure.
(Recommendation 19)
•
The Administrator of the Small Business Administration should conduct and document a
fraud risk assessment for the Economic Injury Disaster Loan program. See Economic Injury
Disaster Loan Program enclosure. (Recommendation 20)
•
The Administrator of the Small Business Administration should develop a strategy that
outlines speciﬁc actions to address assessed fraud risks in the Economic Injury Disaster
Loan program on a continuous basis. See Economic Injury Disaster Loan Program
enclosure. (Recommendation 21)
•
The Administrator of the Small Business Administration should implement a
comprehensive oversight plan to identify and respond to risks in the Economic Injury
Disaster Loan program to help ensure program integrity, achieve program eﬀectiveness,
and address potential fraud. See Economic Injury Disaster Loan Program enclosure.
(Recommendation 22)
•
The Administrator of the Small Business Administration should conduct and document
a fraud risk assessment for the Paycheck Protection Program. See Paycheck Protection
Program enclosure. (Recommendation 23)
•
The Administrator of the Small Business Administration should develop a strategy
that outlines speciﬁc actions to monitor and manage fraud risks in the Paycheck
Protection Program on a continuous basis. See Paycheck Protection Program enclosure.
(Recommendation 24)
•
The Federal Emergency Management Agency Administrator should adhere to the agency’s
protocols listed in its updated 2019 Tribal Consultation Policy by obtaining tribal input
via the four phases of the tribal consultation process when developing new policies and
procedures related to COVID-19 assistance. See FEMA’s Disaster Relief Fund and Assistance
to Tribal Governments enclosure. (Recommendation 25)
•
The Federal Emergency Management Agency Administrator should provide timely and
consistent technical assistance to support tribal governments’ eﬀorts to request and
receive Public Assistance as direct recipients, including providing additional personnel,
if necessary, to ensure that tribal nations are able to eﬀectively respond to COVID-19.
See FEMA’s Disaster Relief Fund and Assistance to Tribal Governments enclosure.
(Recommendation 26)
•
The Secretary of Education should regularly collect and publicly report information on
school districts’ ﬁnancial commitments (obligations), as well as outlays (expenditures)
in order to more completely reﬂect the status of their use of federal COVID-19 relief
funds. For example, Education could modify its annual report on state and school district
Page 3
GAO-21-387

spending data to include obligations data in subsequent reporting cycles. See K-12
Education enclosure. (Recommendation 27)
•
The Director of the Oﬃce of Management and Budget should work in consultation with
federal agencies and the audit community (e.g., agency Oﬃces of Inspector General;
National Association of State Auditors, Comptrollers, and Treasurers; and American
Institute of Certiﬁed Public Accountants), to the extent practicable, to incorporate
appropriate measures in the Oﬃce of Management and Budget’s process for preparing
single audit guidance, including the annual Single Audit Compliance Supplement, to better
ensure that such guidance is issued in a timely manner and is responsive to users’ input
and needs. See Single Audits enclosure. (Recommendation 28)
Page 4
GAO-21-387

Introduction
March 31, 2021
Congressional Committees
More than a year after the Secretary of Health and Human Services ﬁrst declared a public health
emergency for the U.S. and the World Health Organization characterized the Coronavirus Disease
2019 (COVID-19) as a pandemic, COVID-19 continues to result in catastrophic loss of life and
substantial damage to the global economy, stability, and security.1 Worldwide, as of March 15,
2021, there were more than 119,452,000 reported cases and about 2,648,000 reported deaths due
to COVID-19; within the U.S., there were about 29,270,000 reported cases and more than 523,000
reported deaths.2
The country also continues to experience serious economic repercussions and turmoil as a result
of the pandemic. As of February 2021, there were about 10 million unemployed individuals,
compared to nearly 5.8 million individuals at the beginning of 2020.3
In March 2020, Congress took action in response to this unprecedented global crisis to protect the
health and well-being of Americans. Notably, Congress passed, and the President signed into law,
the CARES Act, which provided over $2 trillion in emergency assistance and health care response
for individuals, families, and businesses aﬀected by COVID-19.4 Over the past year, agencies from
across the federal government have demonstrated extraordinary dedication and commitment to
responding to the unprecedented COVID-19 pandemic, including those serving on the front lines
to establish and sustain services for those infected with the virus.
1On January 31, 2020, the Secretary of Health and Human Services declared a public health emergency for the U.S.,
retroactive to January 27. Subsequently, on March 13, 2020, the President declared COVID-19 a national emergency
under the National Emergencies Act and a nationwide emergency under section 501(b) of the Robert T. Staﬀord Disaster
Relief and Emergency Assistance Act (Staﬀord Act). The President has also approved major disaster declarations under
the Staﬀord Act for all 50 states, the District of Columbia, and ﬁve territories.
2Worldwide data from the World Health Organization reﬂect laboratory-conﬁrmed cases and deaths reported by
countries and areas. Data on COVID-19 cases in the U.S. are based on aggregate case reporting to the Centers for
Disease Control and Prevention (CDC) and include probable and conﬁrmed cases as reported by states and jurisdictions.
CDC COVID-19 counts are subject to change due to delays or updates in reported data from states and territories.
According to CDC, the actual number of COVID-19 cases is unknown for a variety of reasons, including that people who
have been infected may have not been tested or may have not sought medical care. CDC’s National Center for Health
Statistics COVID-19 death counts in the U.S. are based on provisional counts from death certiﬁcate data, which do not
distinguish between laboratory-conﬁrmed and probable COVID-19 deaths. Provisional counts are incomplete due to an
average delay of 2 weeks (a range of 1–8 weeks or longer) for death certiﬁcate processing. The data were accessed on
March 23, 2021. Data include deaths occurring from January 2020 through the week ending on March 13, 2021.
3Bureau of Labor Statistics, Unemployment Level (UNEMPLOY), retrieved from FRED, Federal Reserve Bank of St. Louis,
accessed March 17, 2021, https://fred.stlouisfed.org/series/UNEMPLOY.
4Pub. L. No. 116-136, 134 Stat. 281 (2020). As of March 11, 2021, ﬁve other relief laws were also enacted in response
to the COVID-19 pandemic: the American Rescue Plan Act of 2021, Pub. L. No. 117-2, 135 Stat. 4; the Consolidated
Appropriations Act, 2021, Pub. L. No. 116-260, 134 Stat. 1182 (2020); Paycheck Protection Program and Health Care
Enhancement Act, Pub. L. No. 116-139, 134 Stat. 620 (2020); Families First Coronavirus Response Act, Pub. L. No.
116-127, 134 Stat. 178 (2020); and the Coronavirus Preparedness and Response Supplemental Appropriations Act, 2020,
Pub. L. No. 116-123, 134 Stat. 146. In this report, we refer to these six laws, each of which was enacted as of March 11,
2021, and provides appropriations for the COVID-19 response, as “COVID-19 relief laws,” and the funding appropriated
by these laws as “COVID-19 relief funds.”
Page 5
GAO-21-387

Since the enactment of the CARES Act—which includes a provision for GAO to report bimonthly
on its ongoing eﬀorts related to the pandemic—we have continued to monitor and oversee
the federal government’s eﬀorts to prepare for, respond to, and recover from the COVID-19
pandemic.5 To date, we have issued six reports in response to this provision, made 44
recommendations to federal agencies, and raised four matters for congressional consideration to
improve the federal government’s response eﬀorts.6
Since taking oﬃce, the new administration has taken some action consistent with our
recommendations, such as issuing the National Strategy for the COVID-19 Response and Pandemic
Preparedness and issuing executive orders calling for the development of a pandemic supply chain
resilience strategy and providing emergency economic relief. We will continue to monitor the
administration’s actions towards addressing our recommendations in future reporting. Agencies
should swiftly take action on the 38 prior recommendations that have not been fully implemented
from our CARES Act reports issued since June 2020, including those on topics such as addressing
potential fraud, developing national testing and vaccine strategies, and providing clear and
consistent communication.
We are also examining the federal government’s COVID-19 vaccine eﬀorts, which will be the focus
of an upcoming report. In addition, we have issued other targeted COVID-19-related report in
areas such as Federal Reserve lending programs supported by CARES Act funds, the Defense
Production Act, and the CARES Act loan program for aviation and other eligible businesses, and
we have reviews ongoing in these and other areas.7 Additionally, we will review actions federal
agencies have taken in response to the American Rescue Plan of 2021 in future reporting.
This report examines the federal government’s continued eﬀorts to respond to and recover from
the COVID-19 pandemic. We make 28 new recommendations to federal agencies in areas including
relief for health care providers, veterans’ health care, nursing homes, federal contracts and
agreements for the COVID-19 response, the Paycheck Protection Program, and unemployment
insurance programs.
This report also includes 46 enclosures about a range of federal programs and activities across
the government concerning public health and the economy. (See Appendix I) Figure 1 lists these
enclosures by topic area and highlights those with new recommendations.
5Pub. L. No. 116-136, § 19010, 134 Stat. at 579-81.
6 COVID-19: Critical Vaccine Distribution, Supply Chain, Program Integrity, and Other Challenges Require Focused Federal
Attention, GAO-21-265 (Washington, D.C.: Jan. 28, 2021); COVID-19: Urgent Actions Needed to Better Ensure an Eﬀective
Federal Response, GAO-21-191 (Washington, D.C.: Nov. 30, 2020); COVID-19: Federal Eﬀorts Accelerate Vaccine and
Therapeutics Development, but More Clarity Needed, GAO-21-207 (Washington D.C.: Nov. 17, 2020); COVID-19: Federal
Eﬀorts Could Be Strengthened by Timely and Concerted Actions, GAO-20-701 (Washington, D.C.: Sept. 21, 2020); COVID-19:
Brief Update on Initial Federal Response to the Pandemic, GAO-20-708 (Washington, D.C.: Aug. 31, 2020); and COVID-19:
Opportunities to Improve Federal Response and Recovery Eﬀorts, GAO-20-625 (Washington, D.C.: June 25, 2020).
7For a complete list of all GAO COVID-related products, see https://www.gao.gov/coronavirus.
Page 6
GAO-21-387

Figure 1: Report Enclosures by Topic Area
Given the government-wide scope of this report, we undertook a variety of methodologies to
complete our work, including examining a wide range of data sources and conducting interviews
with federal and state oﬃcials and representatives from stakeholder groups including health
care professionals and other entities. Among other things, we examined federal laws, agency
documents, and guidance. In each enclosure, we include a summary of the methodology speciﬁc
to the work conducted.
See Appendix II for a list of ongoing GAO work related to COVID-19 and Appendix III for the status
of matters for congressional consideration and recommendations for executive action made in
our June, September, November 2020, and January 2021 CARES Act reports and in our November
2020 report on vaccines and therapeutics.
We conducted this performance audit from October 2020 to March 2021 in accordance with
generally accepted government auditing standards. Those standards require that we plan and
perform the audit to obtain suﬃcient, appropriate evidence to provide a reasonable basis for our
ﬁndings and conclusions based on our audit objectives. We believe the evidence obtained provides
a reasonable basis for our ﬁndings and conclusions based on our audit objectives.
Page 7
GAO-21-387

Background
Public Health and Economic Eects
The number of new reported COVID-19 cases reached a high in January 2021 and decreased
considerably in February. Between February 25 and March 10, 2021, new reported COVID-19 cases
averaged about 65,000 per day, which was about a quarter of the peak that occurred during the
winter of 2021 and similar to the peak that occurred during the summer of 2020 (see ﬁg. 2).8
During this same 2-week period, reported new COVID-19 cases per day, on average, increased in 5
jurisdictions, held steady in 18 jurisdictions, and decreased in 28 jurisdictions.9
The need to remain vigilant in eﬀorts to contain the spread of the virus is underscored by the
emergence of new variants of the virus, the fragmented nature of our public health sector, the
fragility of our medical supply chain, and longstanding disparities in health care access, treatment,
and outcomes. The virus also continues to be an obstacle to a more robust economic recovery.
Figure 2: Reported COVID-19 Cases per Day in the U.S., through March 10, 2021
Note: Reported COVID-19 cases include conﬁrmed and probable cases. Beginning April 14, 2020, states could include probable
as well as conﬁrmed COVID-19 cases in their reports to CDC. Prior to that time, counts only included conﬁrmed cases. According
to CDC, the actual number of cases is unknown for a variety of reasons, including that people who have been infected may not
have been tested or may have not sought medical care. The data were accessed on March 15, 2021.
8CDC COVID-19 counts are subject to change due to delays or updates in reported data from states and territories. We
compared the relative diﬀerence between the average of new cases between February 25 and March 10, 2021 and the
average number of new cases in the 14-day windows around the peaks in the summer of 2020 and the winter of 2021.
9The 52 states and jurisdictions include all 50 states, Washington, D.C., and New York City. COVID-19 case counts for New
York City are reported separately from New York State. One state was then excluded due to unstable data. We deﬁned
states as holding steady if they had less than a 1 percent increase or decrease in average daily new cases over the time
frame. The average percent change in daily new cases was calculated as the average of the daily rates of change of the
7-day moving average between February 25, 2021, and March 10, 2021. CDC COVID Data Tracker data were accessed on
March 15, 2021. These COVID-19 case counts may change as new or updated data are reported by states.
Page 8
GAO-21-387

According to data from the Centers for Disease Control and Prevention’s (CDC) National Center
for Health Statistics, about 520,000 more deaths occurred from all causes (COVID-19 and other
causes) than would be normally expected from February 2020 through mid-February 2021,
highlighting the eﬀect of the pandemic on U.S. mortality (see ﬁg. 3).
Figure 3: Higher-Than-Expected Weekly Mortality, February 2020 through mid-February 2021
Note: The ﬁgure shows the number of deaths from all causes in a given week through February 13, 2021, reported in the U.S.
that exceeded the upper bound threshold of expected deaths calculated by CDC’s National Center for Health Statistics on the
basis of variation in mortality experienced in prior years. See CDC’s National Center for Health Statistics webpage on excess
deaths for further details on how CDC estimates this upper bound threshold: https://www.cdc.gov/nchs/nvss/vsrr/covid19/
excess_deaths.htm, accessed on March 15, 2021. The number of deaths in recent weeks should be interpreted cautiously as
this ﬁgure relies on provisional data that are generally less complete.
Providing the public with safe and eﬀective vaccines to protect people from getting sick with
COVID-19 is crucial to mitigating the public health and economic impacts of the virus and ending
the pandemic. It is also a time-sensitive undertaking, with over 6 million cases of COVID-19 and
95,704 deaths reported in the United States in the month of January 2021 alone. Two, two-dose
COVID-19 vaccines were authorized for emergency use in December 2020 and a third, one-dose
vaccine was authorized in February 2021.10 Doses of COVID-19 vaccine administered each day
have steadily increased from December 14, 2020 through March 10, 2021, with a temporary dip
in February due to severe weather across the country (see ﬁg. 4). As of March 15, 2021, about
109,082,000 doses had been administered, according to CDC.
10Pﬁzer’s two-dose COVID-19 vaccine was authorized for emergency use on December 11, 2020, and Moderna’s two-
dose COVID-19 vaccine was authorized on December 18, 2020. Janssen’s (Johnson & Johnson) one-dose COVID-19
vaccine was authorized for emergency use on February 27, 2021.
Page 9
GAO-21-387

Figure 4: Daily Count of Doses of COVID-19 Vaccine Administered and Reported to CDC, through March 10 2021
Note: Data show the number of COVID-19 vaccine doses administered in the U.S. as reported to CDC by state, territorial, and
local public health agencies, and federal entities, since the national vaccine program began on December 14, 2020, and include
doses administered through all vaccine partners including jurisdictional partner clinics, retail pharmacies, long-term care
facilities, Federal Emergency Management Agency and Health Resources and Services Administration partner sites, and federal
entity facilities. The data were accessed on March 15, 2021. As of March 15, 2021, three COVID-19 vaccines were authorized
for emergency use; two of these vaccines are two-dose regimens and the third vaccine requires one dose. The number of
doses administered on a given day may be aﬀected by several factors, such as weekend days, holidays, weather, and vaccine
availability. On February 19, 2021, oﬃcials from the White House COVID-19 Response Team said in a press brieﬁng that severe
weather across the country impacted vaccine distribution and administration in all 50 states. Further, oﬃcials said the shipment
of 3 days’ worth—about 6 million doses—of vaccines was delayed due to weather.
In addition to the public health eﬀects, the pandemic continues to cause economic challenges,
particularly for the labor market. For example, in February 2021, the employment-to-population
ratio, which measures the share of the population employed, was 3.5 percentage points lower
than in February 2020, indicating that labor market conditions remain worse than in the pre-
pandemic period (see ﬁg. 5).11
11The employment-to-population ratio represents the number of employed people as a percentage of the civilian
noninstitutional population age 16 and over. The ratio is subject to misclassiﬁcation errors with respect to consistently
identifying workers as employed and absent from work or unemployed on temporary layoﬀ.
Page 10
GAO-21-387

Figure 5: Employment Remains below Its Pre-pandemic Level, as of February 2021
The pandemic has aﬀected some sectors of the economy much more than others. In particular,
sectors like leisure and hospitality, mining and logging, and education have seen the largest losses
in employment during the pandemic. Importantly, individuals working in the leisure and hospitality
sector historically have had the lowest average earnings among sectors and, moreover, during the
pandemic have seen the most signiﬁcant job losses, and many low-wage workers remained out of
work as of February 2021 (see ﬁg. 6).
Figure 6: Percentage Change in Employment by Sector, February 2020–February 2021
Federal COVID-19 Funding and Spending
In response to the far-reaching public health and economic crises, Congress has passed, and the
President has signed, legislation to fund recovery eﬀorts for COVID-19 (COVID-19 relief laws).
Figure 7 shows the COVID-19 relief laws enacted from March 2020 through March 11, 2021.
Page 11
GAO-21-387

Figure 7: COVID-19 Relief Laws Enacted, as of March 11, 2021
Note: The ﬁgure shows selected COVID-19-related federal legislation. It does not show all of the COVID-19-related actions
taken by Congress and the administration. Additional federal actions, such as the enactment of legislation providing limited
and targeted relief to certain individuals and presidential actions authorizing federal support for states and individuals, also
occurred during this time frame. Amounts for the ﬁrst ﬁve COVID-19 relief laws are based on appropriation warrant information
provided by the Department of the Treasury (Treasury) as of January 31, 2021. These amounts have increased over time
and could increase in the future for programs with indeﬁnite appropriations, which are appropriations that, at the time of
enactment, are for an unspeciﬁed amount. The amount for the American Rescue Plan Act of 2021 is based on estimates made
by the Congressional Budget Oﬃce.
aThe Coronavirus Preparedness and Response Supplemental Appropriations Act, 2020, provided $7.8 billion to agencies for
health emergency prevention, preparedness, and response activities related to COVID-19, with the Department of Health and
Human Services receiving a majority of the funds. Pub. L. No. 116-123, 134 Stat. 146.
bThe Families First Coronavirus Response Act provided supplemental appropriations for nutrition assistance programs and
public health services and authorized the Internal Revenue Service to provide tax credits for paid emergency sick leave and
expanded family medical leave that the act required certain employers to provide. In addition, the act provided states with
ﬂexibility to temporarily modify provisions of their unemployment insurance laws and policies related to certain eligibility
requirements and provided additional federal ﬁnancial support to the states. Pub. L. No. 116-127, 134 Stat. 178 (2020).
cThe CARES Act provided supplemental appropriations for federal agencies to respond to COVID-19. In addition, it also funded
various loans, grants, and other forms of assistance for businesses, industries, states, local governments, and hospitals;
provided tax rebates for certain individuals; temporarily expanded unemployment beneﬁts; and suspended payments and
interest on federal student loans. Pub. L. No. 116-136, 134 Stat. 281 (2020).
dThe Paycheck Protection Program and Health Care Enhancement Act provided additional appropriations for small business
loans, grants to health care providers, and COVID-19 testing. Pub. L. No. 116-139, 134 Stat. 620 (2020).
eThe Consolidated Appropriations Act, 2021, expanded or extended several CARES Act programs, including unemployment
insurance programs, economic impact payments, and Paycheck Protection Program loans, and rescinded unobligated funds
for certain programs. Pub. L. No. 116-260, 134 Stat. 1182 (2020). As of January 31, 2021, Treasury issued about $948.0 billion in
warrants for appropriations for COVID-19 relief. In addition, approximately $478.8 billion from Treasury’s Economic Stabilization
and Assistance to Distressed Sectors programs and $146.5 billion from the Small Business Administration’s Business Loans
Program was rescinded, in response to the Consolidated Appropriations Act, 2021.
fThe American Rescue Plan Act of 2021 provided additional relief to address the continued impact of COVID-19 on the economy,
public health, state and local governments, individuals, and businesses. The Congressional Budget Oﬃce estimates the
budgetary eﬀects of the law to be $1.9 trillion. Pub. L. No. 117-2, 135 Stat. 4.
As of January 31, 2021, about $3.1 trillion had been appropriated to fund response and recovery
eﬀorts for—as well as to mitigate the public health, economic, and homeland security eﬀects
of—COVID-19.12 As of January 31, 2021, the most recent date for which government-wide
information was available at the time of our analysis, the federal government had obligated a
total of $2.2 trillion and expended $1.9 trillion of the COVID-19 relief funds as reported by federal
12An appropriation provides legal authority for federal agencies to incur obligations and make payments out of the U.S.
Treasury for speciﬁed purposes.
Page 12
GAO-21-387

agencies to the Department of the Treasury’s (Treasury) Governmentwide Treasury Account
Symbol Adjusted Trial Balance System (GTAS).13
Eight spending areas—the Business Loan Programs, unemployment insurance, economic
impact payments, Public Health and Social Services Emergency Fund, Coronavirus Relief Fund,
Education Stabilization Fund, Disaster Loans Programs, and Economic Stabilization and Assistance
to Distressed Sectors programs—represent $2.6 trillion, or 84 percent, of the total amounts
appropriated.14 For these eight largest spending areas, agencies reported obligations totaling $2.0
trillion and expenditures totaling $1.7 trillion as of January 31, 2021. Table 1 provides additional
details on appropriations, obligations, and expenditures of government-wide COVID-19 relief
funds, including the eight largest spending areas.
13An obligation is a deﬁnite commitment that creates a legal liability of the U.S. government for the payment of goods
and services ordered or received, or a legal duty on the part of the U.S. government that could mature into a legal
liability by virtue of actions on the part of the other party beyond the control of the U.S. government. An expenditure is
the actual spending of money, or an outlay. Expenditures include some estimates, such as estimated subsidy costs for
direct loans and loan guarantees. Increased spending in Medicaid is not accounted for in the appropriations provided by
the COVID-19 relief laws. Federal agencies use GTAS to report proprietary ﬁnancial reporting and budgetary execution
information to Treasury.
14The Small Business Administration’s Business Loan Program account includes activity for the Paycheck Protection
Program and certain loan subsidies.
Page 13
GAO-21-387

Table 1: COVID-19 Relief Appropriations, Obligations, and Expenditures, as of January 31, 2021
Major spending area
Total
appropriations a
($ billions)
Total
obligations b
($ billions)
Total
expenditures b
($ billions)
Business Loan Programs
(Small Business Administration)
830.7c
611.3
538.1d
Unemployment Insurance
(Department of Labor)
651.8
437.8
424.1
Economic Impact Payments
(Department of the Treasury)
455.3
415.0
415.0
Public Health and Social Services Emergency Fund
(Department of Health and Human Services)
280.0
195.0
133.9
Coronavirus Relief Fund
(Department of the Treasury)
150.0
150.0
149.5
Education Stabilization Fund
(Department of Education)
112.6
100.0
16.6
Disaster Loans Programs
(Small Business Administration)
50.6
26.4
24.7d
Economic Stabilization and Assistance to Distressed
Sectors
(Department of the Treasury)
21.2e
21.1
19.5d
Other Areas
504.3
216.4
194.9
Total f
3,056.6
2,172.9
1,916.2
Source: GAO analysis of data from the Department of the Treasury and applicable agencies. | GAO-21-387
aCOVID-19 relief appropriations reﬂect amounts appropriated under the Consolidated Appropriations Act, 2021, Pub. L. No.
116-260, 134 Stat. 1182 (2020); Paycheck Protection Program and Health Care Enhancement Act, Pub. L. No. 116-139, 134 Stat.
620 (2020); CARES Act, Pub. L. No. 116-136, 134 Stat. 281 (2020); Families First Coronavirus Response Act, Pub. L. No. 116-127,
134 Stat. 178 (2020); and Coronavirus Preparedness and Response Supplemental Appropriations Act, 2020, Pub. L. No. 116-123,
134 Stat. 146. These amounts are based on appropriation warrant information provided by the Department of the Treasury
as of January 31, 2021. These amounts have increased over time and could increase in the future for programs with indeﬁnite
appropriations, which are appropriations that, at the time of enactment, are for an unspeciﬁed amount. In addition, this table
does not represent transfers of funds that federal agencies may make between appropriation accounts or transfers of funds
they may make to other agencies.
bObligation and expenditure data are based on data reported by applicable agencies.
cThe Consolidated Appropriations Act, 2021, rescinded $146.5 billion from the Small Business Administration’s Business Loans
Programs.
dThese expenditures relate mostly to the loan subsidy costs (the loan’s estimated long-term costs to the U.S. government).
eEconomic Stabilization and Assistance to Distressed Sectors programs received $500 billion in appropriations from the CARES
Act, approximately $478.8 billion was rescinded in response to the Consolidated Appropriations Act, 2021.
fThe sum of amounts may not agree due to rounding.
Page 14
GAO-21-387

Key Principles for an Eective Federal Response
Throughout our reporting in response to the CARES Act, we have identiﬁed and continued to
reinforce the importance of key principles that are essential for an eﬀective federal response
based on our prior work examining responses to public health and ﬁscal emergencies. Speciﬁcally,
federal agencies should
• coordinate, establish, and deﬁne roles and responsibilities among those responding to the
crisis;
• provide clear, consistent communication;
• collect and analyze data to inform decision-making and future preparedness;
• establish clear goals; and
• establish mechanisms for accountability and transparency to help ensure program integrity
and address fraud risks.
As the nation enters the second year of the COVID-19 pandemic, these principles remain
important factors in the federal response to the crisis and a focus of our oversight. In our 2021
High-Risk report, we added Small Business Administration (SBA) loans to our High-Risk List
because of concerns about program integrity.15 In addition, in that report, we discuss other
important challenges facing our nation that merit continuing close attention as emerging issues of
concern, including Department of Health and Human Services’ (HHS) leadership and coordination
of public health emergencies. We will determine whether the leadership and coordination issue
should be added to the High-Risk List once we have completed ongoing and planned work in this
area.
15GAO, High Risk Series: Dedicated Leadership Needed to Address Limited Progress in Most High-Risk Areas, GAO-21-119SP
(Washington, D.C.: Mar. 2, 2021). GAO’s High-Risk Series identiﬁes government operations with vulnerabilities to fraud,
waste, abuse, and mismanagement, or in need of transformation to address economy, eﬃciency, or eﬀectiveness
challenges.
Page 15
GAO-21-387

Executive Summary
Overview
In this report we are making 28 new recommendations across the federal government in the areas
of public health and the economy. As Congress and the administration carry out plans for the
federal government’s ongoing COVID-19 response, we urge action on these 28 recommendations,
as well as 38 of our 44 prior recommendations that have not been fully implemented from six
CARES Act reports. For a summary and the status of all prior recommendations from these
reports, see Appendix III.
Hospital and Pharmacy Perspectives on COVID-19 Vaccine
Administration and Medical Supply Availability
In February 2021, we surveyed 383 hospitals and interviewed nine large retail pharmacy
chains and an association of independent pharmacies to gain their perspectives on vaccine
administration and medical supply availability. Providers expressed concerns about COVID-19
vaccine availability and limitations in certain key medical supplies for administering the
vaccines—notably syringes and needles. Reported concerns included the following.
• Vaccine availability. Of the 166 total hospitals that responded to our survey, 102 (61 percent)
reported not having suﬃcient information to respond to questions from their staﬀ, the public,
and others about vaccine availability. In addition, 35 hospitals (21 percent) described concerns
with general vaccine availability in open-ended survey responses. Similarly, our interviews with
oﬃcials representing retail pharmacy chains and an association of independent pharmacies
also revealed concerns about vaccine availability. For example, representatives from one
retail pharmacy chain stated that the chain has the capacity to administer 25 million doses
per month at 9,900 locations, but the chain’s initial allocation of vaccines from the federal
government was expected to be only 230,000 doses at 250 locations.
Several retail pharmacy chain representatives also indicated that limited vaccine availability
has led to uncertainty regarding the amount of vaccines their pharmacies can expect to
receive each week. The new administration has taken steps to increase certainty and vaccine
availability. For example, the White House announced at the end of January 2021 that the
federal government would begin notifying states earlier about availability and shipments of
vaccines, to give greater certainty for planning vaccination eﬀorts.
• Availability of syringes and needles. Out of the 146 hospitals that reported they have either
begun administering COVID-19 vaccines or plan to do so, 40 hospitals (27 percent) reported
being greatly concerned about having a suﬃcient quantity of syringes in the next 30 days, and
43 hospitals (29 percent) were greatly concerned about having a suﬃcient quantity of needles.
• Capacity to administer COVID-19 vaccines. In addition to supplies, administering vaccines
requires managing vaccine orders as well as having additional storage, staﬀ, and information
technology system capacity. Some of the most commonly cited concerns include having the
ability to track the expected arrival of vaccine orders, having a suﬃcient number of trained
providers to administer vaccines, and storing vaccines in ultra-cold storage.
Page 16
GAO-21-387

Shortages of personal protective equipment (PPE) and COVID-19 testing supplies also remain a
challenge for some providers.
• PPE supply. Most of the 166 hospitals that responded to our survey reported having an
adequate 7-day supply of the 11 types of PPE we asked about in our survey. However, in some
cases, hospitals reported avoiding shortages only with reuse or extending the use of the items.
For example, 37 hospitals (23 percent) reported needing to reuse or extend the use of N95
respirators in order to have a 7-day supply. Representatives from all nine retail pharmacy
chains reported being conﬁdent or very conﬁdent their pharmacies could access 30 days
or more of PPE, and independent pharmacies generally reported suﬃcient access. See our
enclosure on the Strategic National Stockpile and the Medical Supply Chain in appendix I for
additional information and recommendations related to the medical supply chain.
• Testing supplies. Most of the surveyed hospitals conducting COVID-19 diagnostic testing
reported having at least a 7-day supply of testing supplies we asked about in our survey.
However, hospitals were somewhat less conﬁdent about levels of those same supplies over
the next 15 days. Representatives of the retail pharmacy chains and independent pharmacies
that conduct COVID-19 testing did not report current problems accessing testing supplies. See
our enclosure on Funding for COVID-19 Testing in appendix I for more information on testing
issues.
Along with other entities, we have documented persistent and evolving supply chain challenges
throughout the pandemic, such as shortages of key supplies used for COVID-19 testing. We
will continue to examine the medical supply chain, including the role of the Strategic National
Stockpile, in future reporting.
See the enclosure on Hospital and Pharmacy Perspectives on COVID-19 Vaccine Administration
and Medical Supply Availability in appendix I for additional information.
SNS and Medical Supply Chain
The Strategic National Stockpile (SNS), overseen by HHS, is a federal stockpile of vaccines,
pharmaceuticals, and medical supplies and devices designed to be deployed to support the
response to a public health emergency.16 The near depletion of the SNS early in the COVID-19
response raised questions among the state oﬃcials and experts we interviewed about the role
and expectations of the SNS during a nationwide pandemic. However, HHS oﬃcials told us that the
SNS was not designed to provide states with supplies for a prolonged nationwide event such as
the COVID-19 pandemic; it is primarily designed to respond to discrete and localized events.
16See 42 U.S.C. § 247d-6b. The U.S. Government COVID-19 Response Plan (PanCAP Adapted) identiﬁes HHS as the lead
federal agency for the COVID-19 response, with support from the Federal Emergency Management Agency (FEMA),
within the Department of Homeland Security (DHS), for coordination. However, in March 2020, leadership for the overall
federal response shifted to FEMA, including responsibility for the acquisition and distribution of supplies in conjunction
with HHS. At the outset of the COVID-19 pandemic, the SNS was a critical resource to states for needed and scarce
medical supplies.
Page 17
GAO-21-387

Over the course of our CARES Act work, we have reported on eﬀorts to modernize and restructure
the SNS, including progress toward building a 90-day supply of certain key types of PPE, including
eye protection or face shields, gowns, gloves, and N95 respirators, in order to respond to future
surges in COVID-19 cases. According to HHS oﬃcials, they were aiming to meet their 90-day
targets of certain PPE by the end of 2020; however, they also noted that they had to balance
replenishing the stockpile with ensuring adequate commercial availability. As such, HHS reported
delayed delivery of some items to the SNS to enable manufacturers to make them available in the
commercial market to alleviate supply constraints. According to HHS data from February 2021, the
SNS has reached, or almost reached, its 90-day targets for N95 respirators, surgical or procedural
masks, and eye protection or face shields. However, supplies of gloves and gowns or coveralls
remain far from their 90-day targets.
As we reported in January 2021, reexamining the role of the SNS in the U.S. response to pandemics
will require diﬃcult policy decisions and trade-oﬀs about systems, budgets, and authorities.
Stockpiling the SNS for the near term could help address the challenges faced at the beginning
of the pandemic response, including the quality and quantity of supplies provided, and allow for
more targeted allocation strategies. However, HHS oﬃcials were uncertain whether they would
maintain the current 90-day target supply levels beyond the COVID-19 response.
In January 2021, the President signed an Executive Order calling for the development of a
pandemic supply chain resilience strategy to design, build, and sustain a long-term capability to
manufacture medical supplies for future pandemics and biological threats.17 Per the order, this
strategy is to include the role of the SNS in (1) providing and allocating supplies across state, local,
tribal, and territorial governments, (2) sustaining supplies during a pandemic, and (3) contingency
planning, among other things, within 180 days.18 As we previously recommended, a process for
regularly engaging with Congress and stakeholders in the development and implementation of a
medical supply chain strategy to enhance pandemic response capabilities—to include the role of
the SNS—would help guide this complex transformation.
Additionally, the Consolidated Appropriations Act, 2021, included a provision requiring the
President to make publicly available a report containing a whole-of-government plan for eﬀective
response to subsequent COVID-19 outbreaks and for future global pandemic diseases.19 The
act stipulates that this pandemic plan should address how to improve the role of the federal
government with respect to the regulation, acquisition, and disbursement of medical supplies
necessary to respond to COVID-19 as well as the procurement and distribution of PPE, among
other things. See the Strategic National Stockpile and the Medical Supply Chain enclosure in
appendix I for additional information.
17For more information on eﬀorts related to medical supply manufacturing, see the enclosure on Domestic Medical
Product Manufacturing in appendix I.
18Exec. Order No.14,001, 86 Fed. Reg. 7,219 (Jan. 26, 2021).
19Pub. L. No. 116-620, div. W, § 621(b), 134 Stat. at 2403-04.
Page 18
GAO-21-387

Funding for COVID-19 Testing
Diagnostic testing for COVID-19 is critical to controlling and understanding the spread of the virus,
according to HHS. Overall, HHS reported total testing-speciﬁc obligations of about $42.9 billion as
of February 28, 2021. A majority of this funding was obligated to states, localities, territories, and
tribal organizations, but funding was also used by HHS agencies for testing-related activities, such
as procurement of testing supplies and funding for testing for the uninsured.
Oﬃcials from all nine selected jurisdictions we spoke with in January 2021 told us that they had
suﬃcient funding to meet their immediate testing goals.20 While it appears as though a relatively
small percentage (about 7 percent) of the federal testing funding obligated for state, local, and
territorial jurisdictions has been expended, we found this is due, in part, to funding availability
time frames. For example, oﬃcials from six of nine selected jurisdictions told us they or their
members prioritized spending federal funds whose availability ended earliest. However, more
than half of selected jurisdictions told us they had concerns about maintaining testing capacity
and preparedness in the longer term. While the supplemental funding has helped jurisdictions
address needs to respond to the pandemic in the short term, most jurisdictions interviewed for
this report had concerns about future testing and related preparedness. The American Rescue
Plan of 2021, enacted on March 11, 2021, includes funding for implementation of a national
testing strategy, manufacturing and procurement of tests, and assistance to state, local, and
territorial health departments.21 The additional assistance may help ameliorate concerns about
the suﬃciency of funding for COVID-19 testing in the longer term. See the Funding for COVID-19
Testingenclosure in appendix I for additional information.
Emergency Use Authorizations
Generally, medical devices must be cleared or approved by the Food and Drug Administration
(FDA) to be marketed in the U.S.; however, the Secretary of Health and Human Services may
declare that circumstances exist justifying the authorization of emergency use of certain medical
products, including devices.22 Such emergency use authorizations (EUA) allow for the temporary
use of unapproved medical products or unapproved uses of approved medical products, provided
certain statutory criteria are met.23 EUAs have been instrumental in increasing needed supply of
20We spoke with eight states and one territory.
21Pub. L. No. 117-2, tit. II, § 2401, 135 Stat. at 40.
22High-risk devices generally require FDA premarket review and approval to determine whether the device meets the
statutory standard of reasonable assurance of safety and eﬀectiveness for its intended use. Moderate-risk and some
lower-risk devices may require premarket notiﬁcation—also known as 510(k) clearance—whereby they demonstrate that
the new device is substantially equivalent to a legally marketed predicate device. Certain low-risk devices are exempt
from the 510(k) clearance process, but the manufacturer must still register with FDA. Novel devices that are low to
moderate risk but are not substantially equivalent to a legally marketed predicate device must be authorized through
the De Novo classiﬁcation process.
23Among other statutory criteria, the threat must be capable of causing a serious or life-threatening disease or
condition, and it must be reasonable to believe, based on the totality of scientiﬁc evidence available, that the product
may be eﬀective in diagnosing, treating, or preventing the disease or condition and that the known and potential
beneﬁts of the product outweigh the known and potential risks. In addition, there must be no adequate, approved, and
available alternatives to the product. 21 U.S.C. § 360bbb-3(c).
Page 19
GAO-21-387

certain devices, such as PPE, during the COVID-19 pandemic response. However, there have been
instances of inconsistencies between EUAs issued by FDA and device guidance from CDC and the
Department of Labor (DOL)—agencies that also have a role in ensuring proper use of respirators
and other devices.24 Such inconsistencies led to confusion and hesitancy among health care
providers about using devices with EUAs, according to health care provider association oﬃcials,
and may have undermined the use of these critical medical products early in the pandemic. We
recommend that FDA, CDC, and DOL work together to develop a process for sharing information
to facilitate decision-making and guidance consistency related to devices with EUAs. HHS—which
includes FDA and CDC—and DOL agreed with this recommendation.
Additionally, oﬃcials representing health care providers, device manufacturers, and distributors
raised a number of concerns about what will happen to authorized devices after the declarations
permitting their use for COVID-19 end.25 The Secretary of Health and Human Services is required
to provide advance notice prior to the termination of the EUA declarations and consult with
manufacturers about proper disposition of authorized devices. HHS has indicated that it intends
to develop draft guidance for a transition plan for medical devices distributed under EUAs for
COVID-19 by the end of the ﬁscal year 2021. As of March 15, 2021, the agency had not released a
draft plan to provide a transition for the use of these devices. Specifying a reasonable timeline and
process for transitioning away from use of authorized devices before the EUA declarations end,
taking into account stakeholder input, would help ensure a smooth transition.
We also recommend that as HHS develops a transition plan for devices with EUAs, it should
specify a reasonable timeline and process for transitioning authorized devices to clearance,
approval, or appropriate disposition that takes into account input from stakeholders. HHS agreed
with this recommendation. See the Emergency Use Authorizations for Medical Devices enclosure
in appendix I for additional information.
COVID-19 Data for Health Care Indicators
Since June 2020, we have identiﬁed concerns with federal COVID-19 data, and we have
underscored that in the midst of a nationwide public health emergency, clear and consistent
communication between the federal government and the public is critical given that eﬀective
response requires the public’s participation.
As part of its eﬀorts to communicate with the public and stakeholders about the pandemic,
several experts suggested to us that the federal government should make federal COVID-19 data
more accessible, such as by making them available from a central online location. HHS publishes
24DOL’s Occupational Safety and Health Administration (OSHA) helps ensure safe and healthy conditions for workers
by setting mandatory workplace safety and health standards and conducting inspections to enforce those standards. In
response to the COVID-19 pandemic, OSHA has issued industry-speciﬁc voluntary guidance for employers on COVID-19-
related precautions, as well as other actions.
25The Secretary of Health and Human Services issued three EUA declarations for medical devices for COVID-19—on
February 4, 2020, regarding in-vitro diagnostic devices for detection or diagnosis of COVID-19; on March 2, 2020, related
to personal respiratory protective devices for COVID-19; and on March 24, 2020, for medical devices including alternative
products used as medical devices during the COVID-19 pandemic. EUAs remain in eﬀect until the EUA declaration under
which the EUA was issued terminates or the EUA is revoked, whichever is earlier. At the time of our review, the Secretary
had not indicated when the relevant EUA declarations would terminate, according to FDA oﬃcials.
Page 20
GAO-21-387

its data on COVID-19 health indicators across several websites, but does not make all of the
data accessible from a central online location. That is, all of its publicly available data are not
located on, or available from website links on, one online location. As a result, the public, including
stakeholders, may not be able to fully understand the extent of the pandemic and use the data to
best inform their decision-making.
We are recommending that HHS make its diﬀerent sources of publicly available COVID-19
data accessible from a centralized location on the internet. This could improve the federal
government’s communication with the public about the ongoing pandemic. HHS neither agreed
nor disagreed with our recommendation, but it agreed that COVID-19 data should be made
accessible to support communication with the public about the pandemic.
See the Health Care Indicators enclosure in appendix I for more information.
COVID-19 Health Disparities
We have previously reported that communities of color have been disproportionately aﬀected by
the pandemic. We continue to emphasize the need for HHS to implement our recommendation
to improve data collection and work with stakeholders to identify and address COVID-19-related
racial and ethnic disparities.
HHS released its COVID-19 Response Health Equity Strategy in July 2020 with a goal to reduce
health disparities by using data-driven approaches to attain the highest level of health possible
for all individuals, including communities of color. We found that HHS’s equity strategy does
not include important elements of an eﬀective national strategy, as deﬁned by our prior work.
For example, HHS’s strategy includes an intermediate outcome to increase access to testing for
populations at increased risk for COVID-19. However, HHS’s strategy does not provide speciﬁc
actions that the agency will take to determine whether or where it needs to increase access to
testing for populations at increased risk for COVID-19—an essential ﬁrst step before taking steps
to increase testing access. By including these elements, HHS can better ensure the eﬀective
implementation of its equity strategy to help improve the health outcomes of populations
disproportionately aﬀected by COVID-19, including communities of color.
Improving completeness of race and ethnicity data for COVID-19 vaccinations is critical to federal
eﬀorts to advance equity. HHS plans to reach disproportionately aﬀected communities through
vaccination strategies, including plans to collect and report timely, complete, and representative
data on COVID-19 vaccinations. However, according to HHS, as of February 8, 2021, data from
states and jurisdictions on race and ethnicity were missing for almost half (45.6 percent) of
COVID-19 vaccine recipients. HHS stated that this information is missing for a variety of reasons,
including a lack of consistent data collection and reporting by physicians and pharmacists and
challenges with transmitting data to HHS. Without complete information on the race and ethnicity
of persons who have received COVID-19 vaccines, HHS may have diﬃculty determining whether
vaccines are distributed equitably to communities of color who have been disproportionately
aﬀected by COVID-19.
We are recommending that HHS incorporate key elements of a national strategy in its COVID-19
Response Health Equity Strategy, including speciﬁc actions to achieve intermediate outcomes
Page 21
GAO-21-387

and determining how they should be prioritized. HHS agreed with this recommendation. In
addition, we are recommending that HHS take steps to ensure more complete reporting of
race and ethnicity information for recipients of COVID-19 vaccinations. HHS neither agreed nor
disagreed with this recommendation. See the Health Disparities enclosure in appendix I for more
information.
Relief for Health Care Providers
The Provider Relief Fund, which reimburses eligible providers for health-care-related expenses
or lost revenues attributable to COVID-19, includes an allocation for the COVID-19 Uninsured
Program.26 Although HHS oﬃcials have not yet determined the total amount to be used for this
program, as of March 1, 2021, approximately $2.2 billion from the Provider Relief Fund had been
disbursed for COVID-19 treatment, testing, and vaccine administration of uninsured individuals.
Providers who choose to participate in this program must attest to its terms and conditions,
which include that the individual treated, tested, or administered a vaccine is uninsured, that
the provider will accept reimbursement as payment in full, and that the provider will not bill the
individual for the balance of the bill.
HHS’s risk assessment identiﬁed the potential for providers to falsify patients as being uninsured
as a risk for the COVID-19 Uninsured Program.27 HHS oﬃcials told us that HHS intends to perform
post-payment reviews of claims to validate certain provider attestations. However, HHS did not
have documentation describing how it plans to conduct these reviews. Without documented
post-payment review policies and procedures and timely implementation of related control
activities, HHS’s ability to consistently identify and recover improper payments will be limited, and
the agency’s eﬀorts to recover the payments identiﬁed as overpayments will be delayed, or the
payments may not be recovered.
We are recommending that HHS ﬁnalize and implement a post-payment review process
to validate COVID-19 Uninsured Program claims and to help ensure timely identiﬁcation of
improper payments, including those resulting from potential fraudulent activity, and recovery of
overpayments. HHS agreed with the recommendation. See the Relief for Health Care Providers
enclosure in appendix I for more information.
Nursing Homes
The health and safety of the 1.4 million elderly or disabled residents in the nation’s more than
15,000 Medicare- and Medicaid-certiﬁed nursing homes—who are often in frail health and living
26In this report, we refer to the HHS’s Health Resources and Services Administration COVID-19 Claims Reimbursement
to Health Care Providers and Facilities for Testing, Treatment, and Vaccine Administration for the Uninsured Program as
the “COVID-19 Uninsured Program.”
27The Oﬃce of Management and Budget Circular No. A-123, Management’s Responsibility for Enterprise Risk Management
and Internal Control, requires executive agencies to evaluate the risks to accomplishing their strategic, operations,
reporting, and compliance objectives and provide an annual Statement of Assurance that represents the agency head’s
informed judgment as to the overall adequacy and eﬀectiveness of the agency’s internal control. Accordingly, HHS’s
Health Resources and Services Administration developed an A-123 risk assessment to identify and assess COVID-19
Uninsured Program risks and identify internal control activities in response to such risks as of September 30, 2020.
Page 22
GAO-21-387

in close proximity to one another—has been of particular concern during the COVID-19 pandemic.
According to HHS case-reporting data, as of February 7, 2021, more than 99 percent of Medicare-
and Medicaid-certiﬁed U.S. nursing homes had reported at least one conﬁrmed resident or staﬀ
case, and more than 80 percent had reported at least one resident or staﬀ COVID-19 death.
Collecting detailed information on vaccinations for nursing home populations is important for
tracking and transparency, particularly because nursing homes have been an epicenter of the
pandemic and because HHS has recommended priority vaccinations for this group. The National
Strategy for the COVID-19 Response and Pandemic Preparedness notes that agencies should share
data on COVID-19 response and recovery eﬀorts and that these data should be publicly available
to support performance tracking and ensure transparency.
HHS collects data and publicly reports the number of vaccination doses, by state, provided to
residents and staﬀ of all long-term care providers participating in an HHS pharmacy partnership
program for vaccinations in long-term care facilities. However, HHS does not publicly report data
showing vaccination rates speciﬁcally for nursing homes and does not collect or report vaccination
data for nursing homes not participating in this program. According to HHS, it does not report
speciﬁcally for nursing homes because of concerns that such data would not accurately reﬂect
vaccination rates in nursing homes—for example, some residents may have received their ﬁrst
dose before being admitted. Without public reporting of these data, it is unclear to what extent
eﬀorts to vaccinate nursing home residents have been successful, and it may be diﬃcult to use
these data to improve ongoing and future vaccination eﬀorts for the nursing home population.
Further, since 2005, HHS has required nursing homes to oﬀer inﬂuenza and pneumococcal
vaccinations to nursing home residents. Data on these vaccinations are a key part of HHS’s
oversight of nursing home infection prevention and control practices. However, as of January 2021,
HHS had not speciﬁed whether nursing homes would be required to oﬀer COVID-19 vaccinations
or how these vaccinations would be incorporated into its requirements or quality measures for
nursing homes. These data are important because they could help manage the risk of COVID-19
outbreaks in nursing homes and serve as an important source of information for consumers
about quality of care, making the collection of complete vaccination rate data critical for any
quality measures developed.
We are recommending that HHS (1) collect data speciﬁc to COVID-19 vaccination rates in nursing
homes and make these data publicly available; and (2) require nursing homes to oﬀer COVID-19
vaccinations to residents and staﬀ and design and implement associated quality measures. HHS
neither agreed nor disagreed with these recommendations. See the Nursing Homes enclosure in
appendix I for more information.
Veterans Health Care
According to the Department of Veterans Aﬀairs (VA), many veterans enrolled in VA’s health
care system are at a higher risk of infection or severe disease from COVID-19 due to their age or
underlying health conditions. VA developed and began executing a COVID-19 vaccination plan
following the emergency use authorization of the Pﬁzer COVID-19 vaccine in December 2020. We
identiﬁed several areas where VA can improve its vaccination eﬀorts:
Page 23
GAO-21-387

• VA is utilizing a phased vaccine rollout; however, VA’s current metrics do not capture vaccine
data by phases. Speciﬁcally, VA has metrics for vaccinations by veteran age and by high-risk
condition, but these metrics do not provide information on vaccinations by phase, because
phases may include veterans based on a combination of factors. For example, phase 1c
includes veterans who are over the age of 65 and veterans under the age of 65 who have high-
risk conditions. VA oﬃcials said that they only collect data required by CDC. Without the ability
to review vaccination data by phase, VA is not able to determine which facilities may be at an
earlier phase than others and direct resources or assistance to those facilities.
• VA lacks targets for when it will move from one vaccination phase to another—or within one
phase, from one group of veterans to another—making it diﬃcult for the department to
assess progress. According to VA, creating vaccination targets is challenging given that vaccine
supply currently lags demand, and the amount of vaccine available to VA is unpredictable
and ﬂuctuates from week to week. As of March 10, 2021, VA had fully vaccinated—that is,
administered two required doses of the Moderna or Pﬁzer vaccines, or one dose of the
Janssen vaccine—to about 908,000 veterans out of the roughly 10 million currently enrolled in
VA’s health care system and about 243,000 VA staﬀ out of approximately 419,000. However,
without preliminary targets, VA may not be able to assess the progress of its vaccination eﬀort
and signal to other groups when they might anticipate being vaccinated.
• VA does not have metrics related to staﬀ and veterans who do not show up for their
vaccination appointments (no-shows), which is inconsistent with its own vaccination goal to
track vaccine administration and completion of both doses of vaccine. Without data on no-
shows, VA may be at an increased risk of not being able to determine the extent to which
staﬀ and veterans are not showing for appointments for their second vaccinations, and may
miss opportunities to better target outreach to individuals not showing up for appointments.
Oﬃcials told us that VA is collecting data required by CDC, which do not include no-show
appointments.
We are recommending that VA (1) develop metrics to assess the number of vaccines
administered by vaccine rollout phase to better assess progress and make any necessary
adjustments as needed; (2) develop preliminary vaccination targets for when it will move from one
vaccination phase to another—or within one phase, from one group of veterans to another—and
(3) collect data on the number of staﬀ and veterans who do not show up for a vaccination
appointment to better monitor for completion of the second dose of the vaccine. VA agreed with
our ﬁrst and third recommendations and agreed in principle with our second recommendation.
See the Veterans Health Care enclosure in appendix I for more information.
Nutrition Assistance
The U.S. Department of Agriculture (USDA) administers a number of federal nutrition assistance
programs to vulnerable populations. Recent legislative and executive actions made several
changes to these programs as the negative economic eﬀects of the COVID-19 pandemic have
continued. For example, beneﬁts for the largest of these programs—the Supplemental Nutrition
Assistance Program (SNAP), administered by USDA’s Food and Nutrition Service (FNS)—were
Page 24
GAO-21-387

increased by 15 percent from January through September 2021 for all participants, according to
USDA.28 Additionally, eligibility was temporarily expanded to certain vulnerable populations.
Until recently, USDA had released minimal data about participation in these programs during
the pandemic, and when the department released data in late January 2021, it did not publicly
share suﬃcient information about data quality. In August 2020, USDA announced that it had
identiﬁed signiﬁcant issues with the quality of state-reported data on two programs, leading to
larger-than-actual estimates for SNAP participation. As it worked to identify the root causes of
the SNAP data issues, USDA opted not to release participation data for any of its other nutrition
assistance programs from July 2020 until late January 2021. When USDA released the data, the
department did not explain how it resolved the data quality issues it previously disclosed, nor did
it share necessary context to help stakeholders and the public understand and interpret the data,
such as the potential for error that manual adjustments to data may introduce.
Oﬃce of Management and Budget (OMB) guidelines direct agencies to consider the usefulness
of information they disseminate to intended users, including the public, and state that the
information should be presented in an accurate, clear, complete, and unbiased manner, and
within a proper context, and that agencies should disclose any sources of error that aﬀect data
quality. Because the department has not published information on its eﬀorts to address prior data
quality issues or disclosed potential sources of error, stakeholders and the public lack suﬃcient
information and appropriate context to interpret key program data and understand the eﬀects
of the pandemic on the programs. We are recommending that USDA (1) provide suﬃcient
context to help stakeholders and the public understand and interpret data on federal nutrition
assistance programs during the pandemic and (2) disclose potential sources of error that may
aﬀect data quality during the pandemic, such as manual processing. USDA generally agreed with
our recommendations.
See the Nutrition Assistance enclosure in appendix I for more information.
Disaster Relief Fund and Assistance to Tribal Governments
The Federal Emergency Management Agency (FEMA), within the Department of Homeland Security
(DHS), continues to play a key role in the ongoing COVID-19 pandemic response eﬀort, including
using the Disaster Relief Fund to provide Public Assistance grants.29 Public Assistance grants
reimburse tribal governments, among others, for pandemic costs, such as testing supplies, PPE,
and vaccine distribution.
Several tribal organizations reported challenges related to completing administrative requirements
to request and receive Public Assistance as a direct recipient during the pandemic––requirements
such as activating an emergency operations plan and submitting a tribal Public Assistance
28SNAP provides low-income individuals and households with beneﬁts to purchase allowed food items and achieve a
more nutritious diet.
29The Disaster Relief Fund receives an annual appropriation and has routinely received supplemental appropriations.
Page 25
GAO-21-387

Administrative Plan.30 While tribal representatives reported that some tribal nations received
technical assistance, many other tribal nations were given little or no technical assistance when
they requested support. For example, two tribal oﬃcials told us that when requesting technical
assistance from FEMA to help with disaster activities, FEMA did not have staﬀ available to assist.
FEMA’s Tribal Pilot Guidance states that tribes may request technical assistance from FEMA to
develop a disaster-speciﬁc Public Assistance Administrative Plan. Without the availability of
consistent and timely technical assistance across regions, some tribal entities may be unable
to request and receive Public Assistance directly from FEMA to help respond to the COVID-19
pandemic.
FEMA’s initial assessment report of its response to the pandemic noted challenges and
recommended that FEMA develop a tribal nation engagement strategy that includes providing
the resources and personnel throughout each region required to support program delivery for all
tribal nations. However, as of March 2021, FEMA had not developed this strategy.
We are recommending that FEMA provide timely and consistent technical assistance to support
tribal governments’ eﬀorts to request and receive Public Assistance as direct recipients, including
providing additional personnel, if necessary, to ensure that tribal nations are able to eﬀectively
respond to COVID-19. DHS agreed with our recommendation.
In addition, in May 2020, multiple tribal associations reported that DHS and FEMA did not formally
consult with tribes for COVID-19 pandemic policies that have tribal implications.31 In 2019, FEMA
issued its Tribal Consultation Policy, which speciﬁes the process for how FEMA engages with tribal
governments in regular and meaningful consultation and collaboration on actions that have tribal
implications.32
FEMA did not follow the tribal consultation process while developing an interim policy detailing
eligible items for reimbursement under the Public Assistance program. FEMA oﬃcials agreed that
this interim policy has tribal implications but the agency did not formally consult with tribes while
developing the interim policy because they did not have the time due to the expedited nature of
that policy and the immediate need to respond to questions from states, tribes, territories, and
localities.
As a result, FEMA issued an interim policy clarifying the types of items and activities eligible for
COVID-19 Public Assistance without tribal input. If tribes had been formally consulted earlier in the
process, they could have been in a better position to provide meaningful input to FEMA on how its
policy might impact tribes before FEMA issued the policy in September 2020. Further, there may
30We have previously reported on the administrative challenges tribal nations have faced in the past when requesting
federal assistance for a major disaster or emergency.
31Letter to Senators Mitch McConnell and Chuck Schumer on COVID-19 recovery legislative proposals (phase 4), May
26, 2020. The following tribal associations signed the letter: the Association on American Indian Aﬀairs, the Inter-Tribal
Emergency Management Coalition of Oklahoma, National Congress of American Indians, National Tribal Emergency
Management Coalition, North West Tribal Emergency Management Council, Montana Tribal Emergency Management
Council, Tribal Emergency Management Association, and United South and Eastern Tribes Sovereignty Protection Fund.
32FEMA Policy Number 101-002-02, Tribal Consultation Policy, July 2019.
Page 26
GAO-21-387

have been less confusion on which items were considered eligible for reimbursement during the
early months of the pandemic, and tribes could have made more informed decisions.
We are recommending that FEMA adhere to the agency’s protocols listed in its updated 2019
Tribal Consultation Policy by obtaining tribal input via the four phases of its tribal consultation
process when developing new policies and procedures related to COVID-19 assistance. DHS
agreed with our recommendation.
See the enclosure on FEMA’s Disaster Relief Fund and Assistance to Tribal Governments in
appendix I for more information.
K-12 Education
The Department of Education (Education) has taken steps to track state and school district
spending of certain COVID-19 relief funds, but the data give an incomplete picture of the status of
funds.33 According to data collected by Education, as of February 28, 2021, states and territories
had spent about $6.1 billion of the approximately $75 billion appropriated for education.
However, federal spending data alone provide an incomplete picture of states’ and school districts’
spending, as there are several factors that inﬂuence the rate at which funds appear to be spent.
For example, there is often a signiﬁcant gap between when a district “uses” the funds (i.e., when
the district orders, contracts for, installs, and pays for goods or services, such as information
technology equipment) and when those funds are reported as “spent” in state and federal
reporting systems, as is common in federal grants management processes. According to Education
oﬃcials, states award applicable funds to school districts so that the school districts can obligate
those funds to speciﬁc purposes. The state does not transfer funds to the district until the district
requests payment for services or deliverables received. Education oﬃcials do not consider the
funds to have been spent until the state requests payment for expenses.
Both Education and Congress have recognized the importance of accurately capturing the status
of COVID-19 relief funds provided to states and school districts to inform the department’s
monitoring and technical assistance, and to provide transparency to the public about uses of the
funds. However, given the gap between when a district uses funds and funds are recorded as
spent, without complete information on obligations, policymakers will not have information on
how these funds are being used to address the pandemic-related education needs of America’s
schoolchildren.
We are recommending that Education regularly collect and publicly report information on school
districts’ ﬁnancial commitments (obligations), as well as outlays (expenditures), in order to more
completely reﬂect the status of their use of federal COVID-19 relief funds. For example, Education
could modify its annual report on state and school district spending data to include obligations
33In this report we refer to State Educational Agencies as states and Local Educational Agencies as school districts. These
include the State Educational Agencies and Local Educational Agencies in the District of Columbia and Puerto Rico, as
well as the U.S. Virgin Islands, Guam, the Commonwealth of the Northern Mariana Islands, and American Samoa.
Page 27
GAO-21-387

data in subsequent reporting cycles. Education agreed with our recommendation. See the K-12
Education enclosure in appendix I for more information.
Economic Impact Payments
The CARES Act and the Consolidated Appropriations Act, 2021, authorized Treasury and the
Internal Revenue Service (IRS) to issue economic impact payments (EIP) as direct payments to help
individuals address ﬁnancial stress due to the pandemic.34 Treasury and IRS quickly issued the
second round of direct payments to most eligible individuals. As of February 28, 2021, Treasury
and IRS had issued 168.2 million payments totaling $275.9 billion for the ﬁrst round of payments
(EIP 1) and 152.4 million payments totaling $147 billion for the second round of payments (EIP 2).
In December 2020, Treasury and IRS sent an estimated 13 to 19 million EIP 2 payments to
temporary bank accounts. As a result, millions of individuals experienced a delay of up to a month
to receive their EIP 2. Tax industry partners, such as tax preparers and tax ﬁnancial services
companies, had established these temporary accounts on behalf of their clients to receive tax
refunds.
IRS oﬃcials said the EIP 2 payments were sent to the temporary bank accounts due to an error.
These oﬃcials added that IRS attempted to address the issue of temporary bank accounts after
EIP 1 but instead uploaded the wrong information for some accounts for EIP 2. IRS did not become
aware of the error until December 31, 2020, when its tax industry partners notiﬁed it that EIP
2 payments had been sent to the temporary accounts. IRS oﬃcials said they did not perform a
quality review of the revised records. According to oﬃcials, they were working under a compressed
time frame, and preparing for the 2021 ﬁling season.
IRS has documented quality review procedures for its operations. However, according to oﬃcials,
they did not consistently follow these procedures for the second round of direct payments. With
the enactment of the American Rescue Plan of 2021, which includes a third round of economic
impact payments and advance payments of the Child Tax Credit, timely reviews of control activities
for making direct payments to individuals could help IRS avoid costly or burdensome errors in the
future.35
We are recommending that IRS periodically review control activities for issuing direct payments
to individuals to determine that the activities are designed and implemented appropriately as IRS
disburses a third round of EIPs and prepares for advance payments on the Child Tax Credit. These
control activities should include appropriate testing procedures, quality assurance reviews, and
processes that ensure payments distributed by tax partners reach the intended recipients. IRS
disagreed with our recommendation. However, IRS acknowledged that it established additional
procedures and reviews upon discovering that it had sent millions of payments to the wrong
account. IRS stated it plans to assess the eﬀectiveness of these new controls during the next round
of Economic Impact Payments and will adjust them as warranted.
34CARES Act, Pub. L. No. 116-136, § 2201, 134 Stat. at 335–40; Consolidated Appropriations Act, 2021, Pub. L. No.
116-260, § 272, 134 Stat. at 1965–76.
35Pub. L. No. 117-2, § 9601, 135 Stat. at 138–44.
Page 28
GAO-21-387

See the Economic Impact Payments enclosure in appendix I for more information.
Economic Injury Disaster Loan Program and Paycheck
Protection Program
The Consolidated Appropriations Act, 2021, appropriated additional funding for the creation of
the Targeted Economic Injury Disaster Loan (EIDL) Advance program and authorized additional
Paycheck Protection Program (PPP) loans, among other things, highlighting the continued need
for ensuring program integrity.36 On March 11, 2021, the American Rescue Plan Act of 2021
appropriated additional funding for entities that qualiﬁed for targeted EIDL advances under the
Consolidated Appropriations Act, 2021, including setting aside a portion for smaller and more
economically impacted businesses in low-income communities.37 The American Rescue Plan Act of
2021 also appropriated additional funding for PPP loans.
Since March 2020, the Department of Justice (DOJ) has publicly announced charges in numerous
fraud-related cases across the country, including charges of identity theft, wire and bank fraud,
and money laundering. See the Federal Fraud-Related Cases enclosure in appendix I for more
information. For example:
• From May 2020 to February 2021, DOJ publicly announced charges in over 30 fraud-related
cases associated with EIDL loans, charging over 50 defendants.
• From May 2020 to February 2021, DOJ publicly announced charges in over 100 fraud-related
cases associated with PPP loans, charging over 170 defendants.
• As of February 2021, at least ﬁve defendants had pleaded guilty to federal charges of
defrauding the EIDL program, and at least 30 defendants had pleaded guilty to federal charges
of defrauding PPP.
Law enforcement oﬃcials we spoke with noted a large number of ongoing investigations and
hotline complaints related to CARES Act loans, including loans made under the EIDL program and
PPP. For example, according to a senior oﬃcial at SBA’s Oﬃce of Inspector General (OIG), as of
January 2021, the agency had opened more than 260 investigations related to CARES Act loans and
received over 70,000 hotline complaints—both far exceeding numbers the oﬃce would typically
receive in a year. Law enforcement oﬃcials also reported systemic patterns of fraud across EIDL
36The Consolidated Appropriations Act, 2021, appropriated additional funding for certain EIDL advances and amended
the CARES Act requirements related to loans and advances, including advances targeted at businesses in low-income
communities. Pub. L. No. 116-260, div. N, tit. III, §§ 331-32, 134 Stat. at 2043-46. The act also authorized additional PPP
loans and allowed additional businesses to receive the loans, expanded the list of allowable uses of proceeds and for
loan forgiveness, and allowed PPP borrowers to receive a second PPP loan of up to $2 million upon meeting certain
criteria. Pub. L. No. 116-260, div. N, tit. III, §§ 301-23, 134 Stat. at 1993-2022.
37The American Rescue Plan Act of 2021 appropriated an additional $10 billion for eligible entities that have not
received the full amount of $10,000 in targeted EIDL advances. The act also appropriated $5 billion to provide an
additional $5,000 for eligible entities in low-income communities that suﬀered economic loss of greater than 50 percent
and employ not more than 10 employees. The $5,000 is available in addition to advances obtained under the CARES Act
or targeted advances under the Consolidated Appropriations Act, 2021. Pub. L. No. 117-2, § 5002, 135 Stat. at 85.
Page 29
GAO-21-387

and PPP investigations, including identity theft, false attestations on loan documents, misuse of
proceeds, and ﬁctitious and inﬂated employee counts. SBA oﬃcials told us that for EIDL, SBA is
supporting many of the DOJ and SBA OIG investigations of EIDL through a team that researches
case ﬁles, responds to inquiries from law enforcement agencies, and shares data on suspected
fraud cases with the SBA OIG, DOJ, and U.S. Secret Service.
SBA has taken some steps to mitigate fraud risks to EIDL and PPP, such as identifying and
addressing risks on a loan-level basis for both programs, but has not taken a strategic approach
to managing fraud risks. We are recommending that SBA (1) conduct and document fraud risk
assessments for the EIDL program and PPP, (2) develop a strategy that outlines speciﬁc actions to
address assessed fraud risks in the EIDL program, and (3) outline speciﬁc actions to monitor and
manage fraud risks in PPP on a continuous basis. SBA agreed with our recommendations.
In addition, in December 2020, SBA’s independent ﬁnancial statement auditor stated that SBA
was unable to provide adequate documentation to support a signiﬁcant number of transactions
and account balances related to EIDL due to inadequate processes and controls. The auditor
noted discrepancies including more than one loan or advance approved and disbursed to the
same borrower, and identiﬁed over 6,000 disbursed EIDL loans (over $212 million total) issued
to potentially ineligible borrowers.38 The auditor noted that SBA management did not properly
design and implement overall eﬀective management controls to account for new and expanded
programs, such as EIDL, under the CARES Act and related legislation.39 In response to the audit
ﬁndings, SBA did recognize that documentation of its processes and controls was not suﬃciently
well developed to support the ﬁnancial statement audit and stated that it is working diligently
to correct any shortcomings for future audits. As a result of concerns about program integrity,
we have added SBA loans to GAO’s High Risk List. We are recommending that SBA implement a
comprehensive oversight plan to identify and respond to risks in the EIDL program to help ensure
program integrity, achieve program eﬀectiveness, and address potential fraud. SBA agreed with
our recommendation.
See the Economic Injury Disaster Loan Program and the Paycheck Protection Program enclosures
in appendix I for more information.
Unemployment Insurance Programs
We continue to have concerns about overpayments and potential fraud in the unemployment
insurance (UI) system, including DOL’s federally funded Pandemic Unemployment Assistance
38Other discrepancies include loans and grants issued to borrowers with inaccurate or invalid tax identiﬁcation
numbers, employer identiﬁcation numbers, or Social Security numbers; loans issued that SBA ﬂagged as potentially
fraudulent; and loans issued to borrowers that SBA ﬂagged because the borrowers were excluded from doing business
with the government.
39GAO’s Standards for Internal Control in the Federal Government provides the overall framework for establishing and
maintaining an eﬀective internal control system, and it lists ﬁve components of internal control representing the highest
level of the hierarchy of standards for internal control in the federal government. The ﬁve components of internal
control are (1) control environment, (2) risk assessment, (3) control activities, (4) information and communication, and
(5) monitoring. The ﬁve components of internal control must be eﬀectively designed, implemented, and operating, and
operating together in an integrated manner, for an internal control system to be eﬀective. GAO, Standards for Internal
Control in the Federal Government, GAO-14-704G (Washington, D.C.: Sept. 10, 2014).
Page 30
GAO-21-387

(PUA) program, which authorizes beneﬁts to certain individuals not otherwise eligible for other UI
beneﬁts, such as self-employed and certain gig economy workers.
For example, according to DOJ, from March 2020 through January 2021, DOJ ﬁled federal charges
against 92 individuals for defrauding the UI programs and an additional 11 individuals pleaded
guilty to federal charges.40 See the Federal Fraud-Related Cases enclosure in appendix I for more
information.
In addition, as of March 15, 2021, DOL reported that states had identiﬁed more than $3.6 billion
in PUA overpayments from March 2020 through February 2021.41 As of March 15, 2021, DOL
reported that states had identiﬁed about $2.6 billion in regular UI overpayments during the
pandemic, in the ﬁnal 3 quarters of 2020 combined. Overpayments are not necessarily a result of
fraud, though some may be.
In response to the recommendation in our January 2021 report that DOL collect data from
states on the amounts of overpayments recovered in the PUA program, DOL has taken steps to
collect data on states’ recovery of PUA overpayments. As of March 15, 2021, 14 states had begun
reporting some overpayment recovery data to DOL. However, the Consolidated Appropriations
Act, 2021, enacted on December 27, 2020, provided states authority to waive certain PUA
overpayments.42 Therefore, additional data on the amounts of PUA overpayments states have
waived are also needed to eﬀectively monitor the recovery of overpayments. The large amount
of already-reported PUA overpayments (about $3.6 billion as of March 15, 2021) indicates the
need for timely data to monitor and support states’ use of overpayment waivers. According to
DOL, states are able to retroactively waive PUA overpayments from the beginning of the program
onward; waived overpayments do not have to be recovered. However, DOL did not include PUA
overpayments waived in updated state reporting requirements issued in early 2021 because,
according to oﬃcials, the agency needed to quickly issue guidance on new PUA provisions in the
Consolidated Appropriations Act, 2021. In early February, DOL oﬃcials told us they did not have
plans to collect data on which states are utilizing the authority to waive PUA overpayments or the
amount of overpayments that states have waived. In a subsequent meeting in late February, DOL
oﬃcials responded that they were developing requirements for states to report these data, which
would be included in a future round of guidance.
40Federal charges refer to criminal complaints and indictments. A charge is merely an allegation, and all defendants are
presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
41We accessed the PUA overpayments data on March 15, 2021; these data are subject to change as more states report
data and states revise previously reported data. The number of states that have reported PUA overpayments data
varies by month; for example, 1 state reported overpayment amounts in March 2020, 15 states reported overpayment
amounts in April 2020, 35 states reported overpayment amounts in January 2021, and 7 states reported overpayment
amounts in February 2021. Among the states reporting data, we identiﬁed wide variation in the amount of PUA
overpayments reported in any given month.
42According to the Consolidated Appropriations Act, 2021, if an individual receives PUA beneﬁts they were not entitled
to, the state must generally require such individuals to repay the amount, but the state can waive that requirement if the
individual was without fault and repayment would be contrary to equity and good conscience. Pub. L. No. 116-260, div.
N, tit. II, § 201(d), 134 Stat. 1182 at 1952.
Page 31
GAO-21-387

We are recommending that DOL collect data from states on the amount of overpayments waived
in the PUA program, similar to the regular UI program. DOL agreed with our recommendation. See
the Unemployment Insurance Programs enclosure in appendix I for more information.
Federal Contracts and Agreements for the COVID-19 Response
Federal contracting activity continues to play a critical role in response to the pandemic. As
of February 28, 2020, agencies obligated more than $55 billion on contracts to support the
COVID-19 response, including $5.2 billion obligated by USDA. Nearly all of USDA’s obligations
supported the Farmers to Families Food Box Program—a program implemented in May 2020
to assist commodity suppliers impacted by the pandemic and to provide food assistance to
the public. However, USDA faced some data reporting challenges for its Farmers to Families
Food Box Program. For example, in February 2021, we found that over $1.2 billion in obligations
for the program were not reported with the COVID-19 National Interest Action (NIA) code. The
COVID-19 NIA code was established on March 13, 2020, to enable the consistent tracking of
COVID-19 contracting actions in the Federal Procurement Data System-Next Generation. USDA
has since corrected the data reporting issues we identiﬁed, but has not established guidance
for its contracting oﬃcials to ensure these challenges do not persist. USDA also experienced
challenges compiling complete contract documentation for its contract awards. According to USDA
oﬃcials, the hundreds of contract actions for the program have largely been executed by a small
staﬀ of one contracting oﬃcer and seven contracting specialists. A contracting oﬃcial told us the
speed with which the contracts were executed and the sheer volume of awards may have aﬀected
oﬃcials’ ability to ensure accurate contract reporting and the compilation of complete contract
ﬁles.
Without guidance reinforcing the need to use the NIA code to track Farmers to Families Food
Box contract actions, USDA may continue to face challenges reporting quality information on
billions of dollars in contract activity to the public—including congressional decision makers,
entities with oversight responsibilities, and taxpayers. Further, without assessing the workforce
needed to manage existing contracts that underpin the program and any future food distribution
contracts, USDA cannot ensure that the challenges the department has encountered with contract
reporting and management of contract documentation are addressed, particularly given that
additional funding continues to be provided to support pandemic-related food distribution eﬀorts.
USDA has taken some steps to mitigate these issues, including using a diﬀerent contracting
approach and completing a workforce reorganization. However, the challenges we found related
to inaccurate contract reporting and incomplete contract ﬁles have persisted even after the
change in contracting strategy. USDA has not assessed whether additional contracting oﬃcers will
be assigned to support the program as of February 2021.
We are recommending that USDA (1) issue guidance—such as an acquisition alert or a reminder
to contracting oﬃcials–on the use of the NIA code for the Farmers to Families Food Box Program
or successor food distribution program to ensure it accurately captures COVID-19-related contract
obligations in support of the program and (2) assess the contracting personnel needed to fully
execute the award and administration of existing contracts in support of the program or successor
food distribution program, and take the necessary steps to ensure it has adequate contracting
staﬀ in place to award and administer any future contract awards for the program. USDA neither
Page 32
GAO-21-387

agreed nor disagreed with our recommendations. See the Federal Contracts and Agreements for
COVID-19 enclosure in appendix I for more information.
Single Audits
Single audits—required for non-federal entities that receive federal awards when their award
expenditures meet a certain dollar threshold amount in a ﬁscal year—help identify deﬁciencies
in the award recipients’ compliance with applicable laws and regulations, help ensure the
appropriate use of federal funds, and reduce the likelihood of federal improper payments.43
Through provisions enacted in the COVID-19 relief laws, the federal government has provided
billions of dollars to non-federal entities that must undergo these single audits when their award
expenditures meet the threshold.44 Each year, OMB, after consultation with federal agencies,
issues a tool that auditors rely on that consolidates applicable legal requirements for numerous
programs into one central place, called a Compliance Supplement.45 OMB’s 2020 Compliance
Supplement—issued in August 2020—was incomplete despite numerous audits already being
underway. OMB released an addendum to the supplement in December 2020.
The lag between the distribution of COVID-19 relief funds to recipients and OMB’s issuance of
single audit guidance contributed to delays in auditors conducting single audits and reporting
the results, which may lead to inconsistent reporting and aﬀect award recipients’ development of
corrective actions. A process for timely preparing and providing the guidance contained in OMB’s
annual Compliance Supplements to auditors is essential to help ensure that single audits can
be performed timely and enhance the federal government’s ability to help safeguard billions of
dollars in federal funds, including those provided under COVID-19 relief laws.
In addition to providing timely guidance, it is also essential that OMB establish and maintain a
clear process that provides adequate time to work with stakeholders—including federal agencies
and the audit community—to determine needed changes to more fully address their input
43The Single Audit Act is codiﬁed, as amended, at 31 U.S.C. §§ 7501-06, and implementing OMB guidance is reprinted
in 2 C.F.R. Part 200 (2020). Non-federal entities (states, U.S. territory and tribal governments, local governments, or
nonproﬁt organizations) that expend $750,000 or more in federal awards in a ﬁscal year are required to undergo a single
audit, which is an audit of an entity’s ﬁnancial statements and federal awards, or a program-speciﬁc audit, for the ﬁscal
year. 31 U.S.C. § 7502; 2 C.F.R. § 200.501.
44For example, the CARES Act appropriated $100 billion to the fund to reimburse eligible providers (including for-
proﬁt providers) for health-care-related expenses or lost revenue attributable to the COVID-19 pandemic, known as the
Provider Relief Fund. Pub. L. No. 116-136, div. B, tit. VIII, 134 Stat. at 563. The Paycheck Protection Program and Health
Care Enhancement Act added an additional $75 billion to the fund, and the Consolidated Appropriations Act, 2021,
added another $3 billion to the fund. Pub. L. No. 116-139, div. B, tit. I, 134 Stat. at 622-23; Pub. L. No. 116-260, div. M, tit.
III, 134 Stat. at 1920-21. Pursuant to single audit regulations issued by HHS, which manages the Provider Relief Fund, for-
proﬁt recipients (which do not meet the statutory deﬁnition of non-federal entities and are thus not subject to the Single
Audit Act) that receive $750,000 or more in annual aggregated HHS awards (including Provider Relief Fund payments)
during their ﬁscal year must undergo (1) an audit in conformance with single audit requirements or (2) a ﬁnancial related
audit of the applicable award(s) in accordance with Generally Accepted Government Auditing Standards. 45 C.F.R. §§
75.216, 75.501.
45The Compliance Supplement provides guidance for auditors that conduct single audits and identiﬁes important
compliance requirements.
Page 33
GAO-21-387

and concerns, which in turn could help ensure the quality of the guidance. This is especially
critical going forward given the magnitude of COVID-19 relief funding. OMB stated that it solicits
comments from members of the audit community, and makes revisions as appropriate, prior to
issuing its ﬁnal annual Compliance Supplement. However, it is unclear to members of the audit
community what OMB’s decision-making process is for resolving concerns raised during the
comment period.
We are recommending that OMB work in consultation with federal agencies and the audit
community (e.g., agency OIGs; National Association of State Auditors, Comptrollers and
Treasurers; and American Institute of Certiﬁed Public Accountants), to the extent practicable, to
incorporate appropriate measures in OMB’s process for preparing single audit guidance, including
the annual Single Audit Compliance Supplement, to better ensure that such guidance is issued in
a timely manner and is responsive to users’ input and needs. OMB neither agreed nor disagreed
with our recommendation.
See the Single Audits enclosure in appendix I for more information.
Employer Tax Relief and Payroll Tax Deferrals
The Families First Coronavirus Response Act and the CARES Act provided tax credits to covered
employers to mitigate the cost of paid sick and family leave for employees aﬀected by COVID-19,
among other tax relief, and the Consolidated Appropriations Act, 2021, amended and extended
some of these credits.46 Our analysis of IRS data showed that 3,379 employers that claimed a
Families First Coronavirus Response Act leave tax credit may be ineligible for the credit, based on
our review of employee counts reported on tax forms employers submit to IRS.47
Because the employee counts on these employer tax forms only account for one pay period
during each quarter, they are therefore imperfect determinants of eligibility for the tax credit.
However, they could serve as a screening tool. For example, because only employers with fewer
than 500 employees are eligible for these credits, employers that report 500 or more employees
on these forms could be contacted and asked to resolve the discrepancy or return any credit
claims for which they were not eligible.
While IRS conducts compliance examinations for these tax forms, resource constraints at the
agency allow for only a small number of examinations (0.1 percent of employment tax ﬁlings
per ﬁscal year 2019); as a result, IRS risks not identifying and addressing a large percentage of
potentially ineligible claims.
46Families First Coronavirus Response Act, Pub. L. No. 116-127, § 7001-05, 134 Stat. at 210–19; CARES Act, Pub. L. No.
116-136, div. A, § 3606, 134 Stat. at 411–12; Consolidated Appropriations Act, 2021, Pub. L. No. 116-260, div. N, § 286, 134
Stat. at 1989–91.
47Form 941—Employer’s Quarterly Federal Tax Return—asks for employee counts as of a speciﬁc pay period in the
quarter, and Form 943—Employer’s Annual Federal Tax Return for Agricultural Employees—has a similar line that asks for
employee counts as of the pay period that includes March 12, 2020. However, eligibility for leave credits is determined
by employee counts on the dates that the employees took leave. For example, for the second quarter, employers are
instructed to report as of June 12.
Page 34
GAO-21-387

We are recommending that IRS leverage employee counts from its tax forms to identify
potentially ineligible COVID-19-related sick and family leave credit claims and address
discrepancies IRS deems signiﬁcant. This approach could be less resource intensive than the
examinations that IRS currently conducts. We are also recommending that IRS conduct outreach
to employment tax return ﬁlers to educate and promote accurate reporting of employee counts
on its tax forms. IRS agreed with both of our recommendations.
See the Employer Tax Relief and Payroll Tax Deferrals enclosure in appendix I for more
information.
Page 35
GAO-21-387

Conclusions
With the issuance of this report, we have now made 72 recommendations to federal agencies and
four matters for congressional consideration to improve the federal response to COVID-19. These
recommendations are tailored to speciﬁc federal programs and initiatives, and, if implemented,
will strengthen the eﬃciency, eﬀectiveness, and accountability of federal eﬀorts. We will continue
to monitor the status of these recommendations as part of our ongoing oversight of the federal
government’s COVID-19 response and recovery eﬀorts.
Page 36
GAO-21-387

Closing
We are sending copies of this report to the appropriate congressional committees, the Oﬃce of
Management and Budget, and other relevant agencies. In addition, the report is available at no
charge on the GAO website at https://www.gao.gov.
If you or your staﬀ have any questions about this report, please contact me at (202) 512-5500
or dodarog@gao.gov. Questions can also be directed to Kate Siggerud, Chief Operating Oﬃcer,
at (202) 512-5600; A. Nicole Clowers, Managing Director, Health Care, at (202) 512-7114 or
clowersa@gao.gov; or Orice Williams Brown, Managing Director, Congressional Relations, at (202)
512-4400 or williamso@gao.gov. Contact points for our Oﬃces of Congressional Relations and
Public Aﬀairs may be found on the last page of this report.
Gene L. Dodaro
Comptroller General of the United States
Page 37
GAO-21-387

Congressional Addressees
The Honorable Patrick Leahy
Chairman
The Honorable Richard Shelby
Vice Chairman
Committee on Appropriations
United States Senate
The Honorable Ron Wyden
Chairman
The Honorable Mike Crapo
Ranking Member
Committee on Finance
United States Senate
The Honorable Patty Murray
Chair
The Honorable Richard Burr
Ranking Member
Committee on Health, Education, Labor, and Pensions
United States Senate
The Honorable Gary C. Peters
Chair
The Honorable Rob Portman
Ranking Member
Committee on Homeland Security and Governmental Aﬀairs
United States Senate
The Honorable Rosa L. DeLauro
Chairwoman
The Honorable Kay Granger
Ranking Member
Committee on Appropriations
House of Representatives
The Honorable Frank Pallone, Jr.
Chair
The Honorable Cathy McMorris Rodgers
Republican Leader
Committee on Energy and Commerce
House of Representatives
The Honorable Bennie G. Thompson
Chair
The Honorable John Katko
Ranking Member
Committee on Homeland Security
Page 38
GAO-21-387

House of Representatives
The Honorable Carolyn B. Maloney
Chairwoman
The Honorable James Comer
Ranking Member
Committee on Oversight and Reform
House of Representatives
The Honorable Richard Neal
Chair
The Honorable Kevin Brady
Republican Leader
Committee on Ways and Means
House of Representatives
Page 39
GAO-21-387

Appendixes and Enclosures
Appendix I: Enclosures
Health Care Indicators
The federal government’s communication of data and COVID-19 indicators to the public and
stakeholders could be improved.
Entity involved: Department of Health and Human Services
Recommendation for Executive Action
The Secretary of Health and Human Services should make the Department’s diﬀerent sources of
publicly available COVID-19 data accessible from a centralized location on the internet. This could
improve the federal government’s communication with the public about the ongoing pandemic.
The Department of Health and Human Services neither agreed nor disagreed with our
recommendation, but it agreed that COVID-19 data should be made accessible to support
communication with the public about the pandemic.
Key Considerations and Future GAO Work
In January 2021, we reported on the need for more complete and consistent COVID-19 data to
inform health care indicators. As we previously reported, the lack of complete and consistent
data limits the Department of Health and Human Services’ (HHS) and others’ ability to monitor
trends in the burden of the pandemic across states and regions, such as COVID-19 cases and
hospitalizations; make informed comparisons between such areas; and assess the impact of
public health actions to prevent and mitigate the spread of COVID-19. Additionally, incomplete
and inconsistent data have limited HHS’s and others’ ability to prioritize the allocation of health
resources in speciﬁc geographic areas or among certain populations most aﬀected by the
pandemic.
We recommended that HHS immediately establish an expert committee comprised of
knowledgeable health care professionals from the public and private sectors, academia, and
nonproﬁts to systematically review and inform the alignment of ongoing data collection and
reporting standards for key health indicators. HHS agreed with our recommendation but
said because of resource constraints and the ongoing response to the pandemic, it could not
commit to immediately doing so. We plan to continue to monitor HHS’s progress in meeting this
recommendation.
In addition to our January 2021 report, throughout this report and our other past bimonthly
reports, we have identiﬁed continued concerns with federal COVID-19 data. For example, in this
report we identiﬁed concerns with the quality of federal data related to
• COVID-19 cases, deaths, and vaccinations in nursing homes—see our Nursing Homes
enclosure; and
Page 40
GAO-21-387

• race and ethnicity for several COVID-19 health indicators, including testing, cases,
hospitalizations, deaths, and vaccinations—see our Health Disparities enclosure.
Background
The rapid spread and evolving nature of the COVID-19 pandemic have underscored the
importance of eﬀectively communicating information about the current status of the pandemic
with the public on a regular basis. In June 2020, we reported that, in the midst of a nationwide
public health emergency, clear and consistent communication between the federal government
and the public is critical given that eﬀective response requires the public’s participation and that
the lack of such communication can lead to a loss of credibility with the public.
Further, eﬀectively communicating information about the incidence, spread, and containment of
an outbreak can help ensure that the public complies with public health measures. For example,
in our 2011 report on the H1N1 inﬂuenza pandemic, we found that uncoordinated communication
between the federal government and the public contributed to confusion and in some cases,
individuals’ failure to seek or receive public health interventions, such as inﬂuenza vaccinations.
The federal government has provided the public and other stakeholders with data on COVID-19
health indicators. For example, HHS has published data on COVID-19 cases, deaths, testing,
hospitalizations, and vaccines on the Centers for Disease Control and Prevention’s (CDC) COVID
Data Tracker.48 Additionally, the Data Strategy and Execution Workgroup (under the White House
COVID-19 Response Team) has published COVID-19 Community Proﬁle Reports in another online
location and the reports focus on trends in COVID-19 indicators in the last 7 days and changes
relative to the week prior.49 CDC also provides access to these reports through a web link on its
COVID Data Tracker.
The COVID-19 Community Proﬁle Reports also highlight selected “hotspot” areas that have a
high case burden and thus have a potentially higher risk for experiencing health care resource
limitations. For example, the March 10, 2021 Community Proﬁle Report stated that in the last
7 days the Miami, Florida area reported 254 COVID-19 cases per 100,000 persons and a test
positivity rate of 9.8 percent.50 In comparison, in the last 7 days, the national rate of COVID-19
cases was 144 cases per 100,000 persons and the test positivity rate was 4.2 percent. In addition,
Miami, Florida had a higher rate of conﬁrmed COVID-19 hospital admissions (9 admissions per
48The CDC COVID Data Tracker website is updated daily. See https://covid.cdc.gov/covid-data-tracker/#datatracker-home
(accessed Mar. 15, 2021).
49The Data Strategy and Execution Workgroup began publishing the daily COVID-19 Community Proﬁle Report in
December 2020. These reports are available online at: https://beta.healthdata.gov/National/COVID-19-Community-
Proﬁle-Report/gqxm-d9w9 (accessed Mar. 12, 2021). This Workgroup, which is managed by an interagency team with
representatives from several agencies and oﬃces including HHS and CDC, also makes available similar information
through its State Proﬁle Reports, which HHS began publishing on January 27, 2021. These reports are available online at:
https://beta.healthdata.gov/browse?tags=covid-19-spr (accessed Mar. 15, 2021).
50The test positivity rate, also known as the percentage of positive COVID-19 test results, is calculated as the number of
positive tests divided by the number of tests performed and resulted.
Page 41
GAO-21-387

100 beds) than the national rate of 5 admissions per 100 beds, in the last 7 days.51 The report
also noted some decreases from the previous week (e.g., the rate of conﬁrmed COVID-19 hospital
admissions decreased by 13 percent nationally and by 10 percent in Miami, Florida).
Additionally, on January 21, 2021, the White House released its National Strategy for the COVID-19
Response and Pandemic Preparedness (National Strategy) which states that the federal government
will regularly communicate information to the public on the status of the pandemic through
expert-led, science-based public brieﬁngs. On January 27, 2021, the federal government began
regularly conducting these brieﬁngs which describe recent national trends in several COVID-19
indicators including cases, hospitalizations, and deaths.
Overview of Key Issues
All 10 of the National Academies experts we interviewed told us the federal government’s
communication of COVID-19 health indicators to the public and stakeholders could be improved.
Several of these experts highlighted the importance of the federal government making data on the
allocation of vaccines available and ensuring the public and stakeholders are aware of, understand
how to use, and are able to easily obtain the COVID-19 data most relevant to them. In addition,
several experts also suggested the federal government improve the accessibility of the data by
centralizing access to it.
Communicating data on populations receiving COVID-19 vaccinations. Several experts
highlighted the importance of the federal government providing information about those receiving
COVID-19 vaccinations to the public and stakeholders. Speciﬁcally, these experts suggested the
federal government share data on the race and ethnicity of those being vaccinated, as well as
other high-risk populations (e.g., such as those age 75 and older) to help ensure public conﬁdence
in the distribution of the vaccine.
Race and ethnicity. Several experts told us it was important to report information on the race
and ethnicity of those being vaccinated to help ensure the vaccine is being equitably provided
to diﬀerent populations. In our November 2020 report, we found that racial and ethnic minority
groups are disproportionately aﬀected by the virus. Further, population immunity is not likely to
be reached without high vaccination rates across all racial and ethnic groups.
On February 8, 2021, CDC began publishing data on the demographic characteristics of those
who received vaccines on its COVID Data Tracker. Speciﬁcally, CDC is reporting data on the race
and ethnicity, gender, and age of those vaccinated at the national level. However, the reporting
of race and ethnicity is less complete compared to gender and age. For example, as of March 11,
2021, CDC found that reporting of race and ethnicity was 53.1 percent complete for recipients who
51We have not assessed the reliability of these data. As stated in the Community Proﬁle Report, test positivity rate is
based on viral (RT--PCR) laboratory tests. Data on tests are reported by states as well as directly by clinical laboratories.
Some states do not report on certain days, which may aﬀect the total number of tests resulted and positivity rate
values. Data on cases are aggregated by CDC from data reported by state and local health departments. Most states
and localities report both conﬁrmed and probable cases, although some report just conﬁrmed cases. Hospital data are
reported to HHS either directly from facilities or via a state submission. Due to inconsistent reporting and data errors,
these data may not represent the true number of admissions.
Page 42
GAO-21-387

received at least one dose while the same reporting on vaccine recipients’ age and gender were
92.0 percent and 91.1 percent complete, respectively. For further information on CDC data on the
race and ethnicity of recipients of COVID-19 vaccinations, see our Health Disparities enclosure,
which includes a recommendation for CDC to ensure the complete reporting of race and ethnicity
information for recipients of COVID-19 vaccinations.
One expert suggested using community-level data on vaccination use and the social characteristics
of communities to assess the equity of vaccine distribution. For example, the Social Vulnerability
Index (SVI) is CDC’s index to measure the relative vulnerability of every county by ranking each
on 15 social factors, including unemployment, minority status, and disability.52 According to CDC,
these data might be used to help emergency response and public health oﬃcials identify and plan
support for communities most likely to need support with a public health emergency. Currently,
CDC does not make available county-level data on vaccination use, but does provide access to SVI
data on its COVID Data Tracker.53 However, CDC oﬃcials stated that the agency plans to provide
county-level data on vaccination use on its COVID Data Tracker in March 2021.54
Other high-risk populations. Several experts said that it is important to make available to the public
vaccination data that corresponds to individuals at higher risk of infection, which includes health
care personnel, residents of long-term care facilities (e.g., nursing homes), persons age 75 or
older, essential workers, and others, according to CDC recommendations.55 Data on who is being
vaccinated would inform the public of whether the goal of vaccinating those at higher risk per CDC
recommendations (such as those age 75 and older) is being met. (For information on the need
for additional data related to COVID-19 vaccinations of nursing home residents and staﬀ, see our
Nursing Home enclosure, which includes a recommendation for CDC to collect data speciﬁc to the
COVID-19 vaccination rates in nursing homes.)
Several of these experts told us sharing vaccination data on high-risk populations with the public
is also important because it can help ensure public conﬁdence in the distribution of the vaccine.
However, it may be challenging to report on certain groups who are at higher risk of infection,
such as health care personnel, as information about vaccine recipients’ occupations are not
reported to CDC by vaccine providers.
Key considerations for communicating federal COVID-19 data. In addition to emphasizing the
importance of consistently communicating COVID-19 information, several experts emphasized
52SVI further groups the 15 social factors into four related themes: socioeconomic status, household composition and
disability, minority status and language, and housing type and transportation. Each county receives a ranking for each
Census variable and for each of the four themes, as well as an overall ranking.
53For county-level COVID-19 data from CDC’s COVID Data Tracker, see: https://covid.cdc.gov/covid-data-tracker/#county-
view (accessed Mar. 15, 2021).
54In March 2021, CDC released a report based on its analysis of county-level COVID-19 vaccination rates by the SVI.
CDC found that between December 14, 2020, and March 1, 2021, high social vulnerability counties had lower COVID-19
vaccination rates than did low social vulnerability counties. See Centers for Disease Control and Prevention, Morbidity
and Mortality Weekly Report, Vol. 70 (March 17, 2021).
55CDC’s Advisory Committee on Immunization Practices (ACIP) recommended priority groups for COVID-19 vaccination.
The committee’s recommendations serve as public health guidance for safe use of vaccines and other related products
and are not binding, as jurisdictions can adopt diﬀerent approaches. See https://www.cdc.gov/vaccines/hcp/acip-recs/
vacc-speciﬁc/covid-19.html (accessed Mar. 15, 2021) for ACIP’s current COVID-19 vaccine recommendations.
Page 43
GAO-21-387

the importance of the federal government ensuring that the public and stakeholders are aware of,
understand how to use, and are able to easily obtain the COVID-19 data that are most relevant to
them. Some of these experts noted that, in general, the public may be more aware of non-federal
sources of data on COVID-19 indicators (e.g., the COVID Tracking Project, Johns Hopkins) than
sources from the federal government.56 Experts explained that at the beginning of the pandemic,
the public and other stakeholders may have turned to non-federal sources for COVID-19 data
because these sources provided more data than the federal government. For example, Johns
Hopkins began publishing data on COVID-19 in January 2020, while CDC oﬃcials told us that
its COVID Data Tracker began publishing data in April 2020. Further, because of their greater
familiarity with non-federal sources of data, the public and stakeholders may have continued to
use them—even as the federal government has continued to expand the COVID-19 data that it
makes available to the public, including as part of CDC’s COVID Data Tracker and the Community
Proﬁle Report. For example, some of the experts told us they continue to use other non-federal
sources of COVID-19 data and also that they were unaware of the Community Proﬁle Reports.
Several experts also told us that it is important that the federal government help the public and
stakeholders understand how to use its COVID-19 data. This could be done by explaining how
to interpret community-level COVID-19 data it makes available, for example, to help inform the
decisions of the public and other stakeholders (e.g. business owners deciding whether to open).
For example, while CDC makes data available on case numbers for the variants of the virus that
cause COVID-19, one expert told us that CDC does not explain how to interpret these numbers nor
does the agency describe how stakeholders, including state and local public health oﬃcials, could
use these data to inform their eﬀorts to respond to the pandemic.57 According to this expert,
this information is important because diﬀerent variants could increase the number of COVID-19
cases and deaths and reduce health care systems’ ability to care for patients. Our 2014 work on
health care transparency states that tools for sharing health care information such as websites are
most eﬀective if they explain the purpose and value of the data reported to guide users in their
interpretation of the data.
Several experts also commented on the importance of the federal government ensuring that users
can readily obtain information that is most relevant to them, such as information about the status
of the pandemic in their local area. For example, some of these experts stated that it is important
to give users the ability to “drill down” to the level of data they need. Further, one expert stated
that the federal government should allow data users to create a customized report that includes
COVID-19 data that are of most relevance to them. Our 2014 work on health care transparency
states that tools for sharing health care information such as websites are most eﬀective if the
information is structured in a way that enables users to obtain information that they consider
most relevant to their personal circumstances (e.g., information about their communities) and if
they allow users to easily adjust how those data are presented.
56As of March 7, 2021, the COVID Tracking Project no longer collects and publishes new COVID-19 data on its website.
Representatives explained that they ended this work because they have more conﬁdence in federal eﬀorts to manage
COVID-19 data.
57For available CDC information on variants, including its surveillance of those variants, see https://www.cdc.gov/
coronavirus/2019-ncov/transmission/variant-cases.html (accessed Mar. 15, 2021).
Page 44
GAO-21-387

CDC has taken steps to ensure the public and stakeholders are aware of, understand how to use,
and can easily obtain the COVID-19 data most relevant to them. For example:
• On February 5, 2021, CDC published a communications tool kit for its COVID Data Tracker that,
according to CDC, is updated weekly and includes social media graphics, videos, and media
resources. CDC oﬃcials also told us that CDC shares information about its COVID Data Tracker
on multiple social media platforms, including by promoting enhancements to the Data Tracker
and featuring ﬁve COVID Data Tracker posts a week.
• On February 12, 2021, CDC launched the COVID Data Tracker Weekly Review. According to
CDC oﬃcials, this newsletter highlights key data from the COVID Data Tracker along with
data trends, narrative interpretations of the data, and visualizations from the week.58 As an
example, the February 19, 2021 Weekly Review featured information about the variants of the
virus that cause COVID-19, including the number of variants that are of concern to global
public health leaders to date, and how to stop new variants of the virus from emerging.
• CDC’s COVID Data Tracker provides tools to help users obtain the data most relevant to them.
This includes the COVID-19 Integrated County View, which allows users to simultaneously
view multiple types of information about the status of the pandemic in their county. As of
February 22, 2021, county-level data across several COVID-19 indicators (e.g., cases, deaths,
hospitalizations) were available from CDC’s COVID-19 Integrated County View tool.
Centralizing access to federal COVID-19 data. As part of its eﬀorts to communicate with
the public and stakeholders about the pandemic, several experts suggested that the federal
government should improve the accessibility of its COVID-19 data by making these data available
from a central location on the internet. CDC oﬃcials told us they were unaware of a single location
on the internet where the public and stakeholders could access all of HHS’s COVID-19 data.
Further, in our review of selected HHS websites and COVID-19 data elements we found examples
in which HHS published data for COVID-19 health indicators across several locations but did
not make all the data accessible from a central online location (e.g., through website links). For
example, we visited CDC’s COVID Data Tracker on March 12, 2021, and were unable to identify
and access other publicly available HHS COVID-19 data from that website. While CDC’s COVID
Data Tracker provided access to data on cases, testing, deaths, hospitalizations, and vaccinations,
among other data, it did not provide users access to other HHS COVID-19 data such as higher-
than-expected deaths and vaccine adverse events. That is, these data were not available on the
COVID Data Tracker or accessible through links to the other websites where these data were
located.
Several experts told us that taking steps to make it easier for members of the public to locate
data on COVID-19 indicators, such as by making them accessible from one website, would help
facilitate the use of those data by the public. These experts told us it is important to make data on
COVID-19 health indicators more accessible because the information may help inform individuals’
decision-making. For example, one expert cited the importance of communicating data on vaccine
58For more information on the COVID Data Tracker Weekly Review, see https://www.cdc.gov/coronavirus/2019-ncov/
covid-data/covidview/index.html (accessed Mar. 15, 2021).
Page 45
GAO-21-387

adverse events in promoting public conﬁdence in the vaccines. In our November 2020 report on
COVID-19 vaccines and therapeutics development, we noted that timely, clear, and consistent
communication about vaccine availability, eﬃcacy, and safety can help ensure public conﬁdence
and trust, which in turn could encourage vaccine use.
As part of its Outbreak Communication Planning Guide, the World Health Organization highlights
the importance of ensuring information is accessible to the public. Speciﬁcally, this guide states
that information needed by at-risk parties to adopt behaviors that could minimize risk must be
proactively released by authorities in a timely and accessible manner. The guide further states
that information relevant to decisions and decision-making associated with the management of a
serious public health event should be made available to interested parties so as to maintain trust
in authorities, public support for control eﬀorts and coordination among partners.
The National Strategy emphasizes the importance of the federal government ensuring its data
for COVID-19 health indicators are accessible to the public and stakeholders. It states CDC will
maintain public dashboard data on key COVID-19 related metrics and the federal government
will ensure that Americans can simply and easily ﬁnd information relevant to them on everything
from testing, vaccines, testimonials, and all available public health guidance. Further, an executive
order signed on January 21, 2021, directs federal agencies, including HHS, to take steps to make
federal COVID-19 data publicly available and accessible.59 The order states these eﬀorts will assist
federal, state, Tribal, territorial, and local authorities and further the public’s understanding of the
pandemic and the response.
CDC oﬃcials told us that CDC’s COVID Data Tracker will serve as the public dashboard as stated
in the National Strategy and that they coordinate with other HHS agencies by providing COVID-19
data through the COVID Data Tracker. However, CDC oﬃcials emphasized that each HHS agency is
responsible for making its own COVID-19 data more accessible to the public and stakeholders and
were unaware of other coordinated eﬀorts at HHS to do so. The absence of a centralized online
location for publicly accessible HHS COVID-19 data is reﬂective of how HHS agencies generally
communicate other data to the public and other stakeholders; that is, they generally report
data that they collect for their own purposes on separate agency-speciﬁc websites. Without a
centralized online location in which individuals can identify and access all publicly available HHS
COVID-19 data and easily obtain the information most relevant to them, the public, including
stakeholders, may not be able to fully understand the extent of the pandemic and use the data to
best inform their decision-making.
Agency Comments
We provided HHS and the Oﬃce of Management and Budget with a draft of this enclosure. HHS
provided general comments, which are reproduced in appendix VI . In its comments, HHS neither
agreed nor disagreed with our recommendation to make its diﬀerent sources of publicly available
COVID-19 data accessible from a centralized location on the internet. HHS oﬃcials agreed that
data should be made publicly accessible where possible to support communication with the public
59Ensuring a Data-Driven Response to COVID-19 and Future High-Consequence Public Health Threats, Exec. Order No.
13994, 86 Fed. Reg. 7,189 (January 21, 2021).
Page 46
GAO-21-387

about the COVID-19 pandemic. They also stated that increased transparency of data remains
a key priority and indicated that HHS will continue to assess opportunities to streamline and
provide transparency to the public and other government stakeholders. Given the importance
of eﬀectively communicating information about the status of the pandemic with the public, we
maintain that HHS should make its publicly available COVID-19 data accessible from a centralized
online location. Centralizing access to these data in a way that allows individuals to easily locate
and obtain the information most relevant to them would improve the ability of the public to fully
understand the extent of the pandemic and use the data to best inform their ongoing decision-
making.
HHS also provided technical comments, which we incorporated as appropriate. The Oﬃce of
Management and Budget did not provide comments on this enclosure.
Methodology
To conduct this work, we obtained input from 10 experts with knowledge in public health, health
systems, and health economics in January 2021.60 We obtained assistance from the National
Academies in identifying these experts to better ensure a breadth of expertise was brought to
bear in its preparation; however, all ﬁnal decisions on the selection of experts for this work are the
sole responsibility of GAO. We asked these experts a core set of questions to obtain their input
on federal eﬀorts to communicate COVID-19 health indicators. In addition, we reviewed relevant
HHS documents and also obtained input from CDC oﬃcials about communicating COVID-19 health
indicators to the public.
Contact information: Jessica Farb, 202-512-7114, farbj@gao.gov
Related GAO Products
Inﬂuenza Pandemic: Lessons from the H1N1 Pandemic Should Be Incorporated into Future Planning.
GAO-11-632. Washington, D.C.: June 27, 2011.
COVID-19: Federal Eﬀorts Accelerate Vaccine and Therapeutic Development, but More Transparency
Needed on Emergency Use Authorizations. GAO-21-207. Washington, D.C.: November 17, 2020.
Health Care Transparency: Actions Needed to Improve Cost and Quality Information to Consumers,
GAO-15-11. Washington, D.C.: October 20, 2014.
60We interviewed six experts and received written responses from four experts that we previously interviewed for our
November and January reports. These experts included former leaders of federal agencies, including the Centers for
Disease Control and Prevention, Food and Drug Administration, and Centers for Medicare & Medicaid Services.
Page 47
GAO-21-387

Economic Indicators
Since the onset of the COVID-19 pandemic, mandated public health-related restrictions on
economic activity, precautions by consumers, and adjustments by the private sector combined
to create an extraordinary shock to the economy. In response, the federal government adopted a
range of measures designed to support diﬀerent areas of the economy, including labor markets,
households, small business ﬁnances, corporate credit markets, and state and local government
ﬁnances. These areas of the economy have recovered to greatly varying degrees over the last year
(see table). Going forward, the strength of the economic recovery will continue to depend on the
success of public health measures against the COVID-19 pandemic.
As of February 2021, indicators for some areas of the economy supported by the federal
pandemic response had returned to pre-pandemic levels while other areas remained far
from their pre-pandemic conditions.61 Improvements in bond market indicators, for example,
suggest that corporate borrowers and state and local governments had access to credit that was
somewhat improved compared to before the pandemic. In contrast, the share of the population
employed remained signiﬁcantly below pre-pandemic levels, and the share of borrowers seriously
delinquent on mortgage payments remained well above pre-pandemic levels. Moreover, our
analysis of job losses and small business delinquencies identiﬁed sectors hard hit by the pandemic
that have yet to fully recover, in particular the leisure and hospitality and mining and logging
sectors.
61We identiﬁed a number of economic indicators to facilitate ongoing and consistent monitoring of areas of the
economy supported by the federal pandemic response. To the extent that federal pandemic responses are eﬀective, we
would expect to see improvements in outcomes related to these indicators. However, while trends in these indicators
may be suggestive of the eﬀect of provisions of the COVID-19 relief laws over time, those trends will not on their own
provide deﬁnitive evidence of their eﬀectiveness.
Page 48
GAO-21-387

Indicators for Areas of the Economy Supported by the Federal COVID-19 Pandemic Response, November 2020
through February 2021, Cumulative Changes since February 2020
aThe employment-to-population ratio represents the number of employed people as a percentage of the civilian
noninstitutional population 16 years and over. The ratio is subject to misclassiﬁcation errors with respect to consistently
identifying workers as employed and absent from work or unemployed on temporary layoﬀ.
bHigher levels in the Consumer Credit Default Composite Index rate indicate more defaults on consumer loans, including auto
loans, bank cards, and mortgages. The Consumer Credit Default Composite Index could be subject to seasonal variation but is
not seasonally adjusted.
cSeriously delinquent loans are 3 months or more past due or in foreclosure, based on mortgages insured by the Federal
Housing Administration (FHA). Increases in serious delinquency rates on FHA loans could to some extent reﬂect borrowers
Page 49
GAO-21-387

taking advantage of mortgage forbearance provisions of the CARES Act, but may also indicate ﬁnancial challenges facing the
minority and low-to-moderate income households that disproportionately take out mortgages insured by FHA.
dLower levels of the small business credit card delinquency index indicate more delayed payments on credit. The small
business credit card delinquency index is published under license and with permission from Dun & Bradstreet, and no
commercial use can be made of these data.
eCorporate bond spreads are option-adjusted spreads on dollar-denominated investment grade corporate bonds from
Bloomberg and are measured in basis points or 1/100th of a percentage point. Higher spreads reﬂect higher perceived risk
among corporate borrowers by investors.
fSpreads on municipal bonds are calculated relative to interest rates on Treasury securities based on the Bloomberg-Barclays
Municipal Bond Index and are measured in basis points or 1/100th of a percentage point. Higher spreads reﬂect higher
perceived risk among municipal borrowers by investors.
gState and local government employment data from January 2021 and February 2021 are preliminary.
hHealth care employment data from January 2021 and February 2021 are preliminary.
The national economy experienced a substantial contraction in the second quarter of 2020 but
grew in the third and fourth quarters of 2020 based on the growth of Gross Domestic Product
(GDP). The Federal Reserve Bank of New York’s Weekly Economic Index, which combines high-
frequency economic data from a wide range of sources, also indicated a substantial contraction in
March and April 2020, followed by a gradual recovery (see ﬁgure).62 However, both GDP and the
Weekly Economic Index suggest that, as of February 2021, the economic recovery has slowed and
that the economy is smaller than it was a year ago.
Weekly Economic Index, January 2019 through February 2021
Note: The index value of the Weekly Economic Index corresponds to a year-over-year growth rate in gross domestic product
were conditions to remain at that value for a full quarter.
62See Daniel J. Lewis, Karel Mertens, and Jim Stock, U.S. Economic Activity during the Early Weeks of the SARS-Cov-2
Outbreak, Federal Reserve Bank of New York Staﬀ Report No. 920 (April 2020). The index value of the Weekly Economic
Index corresponds to a year-over-year growth rate in gross domestic product were conditions to remain at that value for
a full quarter.
Page 50
GAO-21-387

As we noted in our June 2020 report, the impact of the COVID-19 pandemic on the economy
will reduce federal tax revenues, while the ﬁscal response from the COVID-19 relief laws and
heightened demands on federal social programs will increase expenditures.63 Federal debt held
by the public increased from $17.4 trillion in February 2020 to $21.8 trillion in February 2021. As
a share of GDP, debt held by the public increased from 79.0 percent in the fourth quarter of 2019
to 100.7 percent in the fourth quarter of 2020. Interest rates on 3-month Treasury securities were
1.54 percent in February 2020 and fell to 0.14 percent in April 2020 as the Federal Reserve reduced
its target interest rates. As of February 2021, 3-month interest rates were 0.04 percent.64 While
interest rates on Treasury securities are low at the moment, reducing the cost of newly issued
debt, the long-term ﬁscal challenges facing the U.S. have been exacerbated by the pandemic and
will require attention once the economy has returned to consistent growth and public health goals
have been attained.65
Labor market conditions. In February 2021, the employment-to-population ratio, which
measures the share of the population employed, was 3.5 percentage points lower than in
February 2020, suggesting that labor market conditions remain worse than in the pre-pandemic
period. The pandemic has aﬀected some sectors of the economy much more than others. In
particular, industries like leisure and hospitality and mining and logging have seen the largest
percentage losses in employment during the pandemic (see ﬁgure). Importantly, individuals
working in the leisure and hospitality sector historically have had the lowest average earnings
among sectors and, moreover, during the pandemic have seen the most signiﬁcant job losses,
indicating that many low wage workers remained out of work as of February 2021.
63For Covid-19 relief provisions, see American Rescue Plan Act of 2021, Pub. L. No. 117-2, 135 Stat. 4; Consolidated
Appropriations Act, 2021, Pub. L. No. 116-260, 134 Stat. 1182 (2020); Paycheck Protection Program and Health Care
Enhancement Act, Pub. L. No. 116-139, 134 Stat. 620 (2020); CARES Act, Pub. L. No. 116-136, 134 Stat. 281 (2020);
Families First Coronavirus Response Act, Pub. L. No. 116-127, 134 Stat. 178 (2020); Coronavirus Preparedness and
Response Supplemental Appropriations Act, 2020, Pub. L. No. 116-123, 134 Stat. 146.
64The 3-month Treasury interest rate is the constant maturity rate from the Federal Reserve’s H.15 Selected Interest
Rates release.
65See GAO, The Nation’s Fiscal Health: Action Is Needed to Address the Federal Government's Fiscal Future, GAO-20-403SP
(Washington, D.C.: Mar. 12, 2020).
Page 51
GAO-21-387

Percentage Change in Employment by Sector, February 2020 through February 2021
Note: Other services include repair and maintenance, personal and laundry services, and membership associations and
organizations. Data from February 2021 are preliminary.
Moreover, labor market conditions have weakened more for Hispanic, Black, and Asian Americans
relative to White Americans since the pandemic began (see ﬁgure). In recent months, the number
of initial claims for unemployment beneﬁts have remained historically high, indicating ongoing
instability in the labor market.
Change in Employment-to-Population Ratio by Race and Ethnicity, February 2020 through February 2021
Household ﬁnancial conditions. While trends in consumer credit defaults suggest an
overall improvement in household ﬁnancial conditions over the last year, trends in mortgage
delinquencies suggest ongoing ﬁnancial challenges facing some households. Speciﬁcally, as of
January 2021 the Consumer Credit Default Composite Index—a broad measure of households’
ability to make scheduled payments—improved somewhat over the course of the pandemic. In
addition, subindexes for bank cards, ﬁrst mortgages, and auto loans improved during the same
time period.66 Although changes in these indexes over time should provide a general indication
of changes in the ﬁnancial condition of households, forbearance arrangements could aﬀect the
measurement of consumer credit defaults.67
66The S&P/Experian Consumer Credit Default Composite Index measures the proportion of consumer credit account
balances that enter default across auto loans, ﬁrst and second mortgages, and bank cards each month.
67The CARES Act provided temporary protections for millions of households against foreclosure and eviction, as well
as temporary forbearance, suspending mortgage payments for up to 360 days. In addition, the CARES Act includes
Page 52
GAO-21-387

In contrast to measured consumer credit defaults, serious delinquency rates for single family
mortgage loans—loans that are 90 or more days past due or in foreclosure—increased
dramatically in May 2020, decreased slightly in more recent months, but remain much higher than
in February 2020, as of January 2021 (see ﬁgure).
Serious Delinquency Rates on Single-Family Residential Mortgages, January 2019 through January 2021
Note: The serious delinquency rate on conventional loans is calculated based on a weighted average of serious delinquency
rates of conventional loans guaranteed by Fannie Mae and Freddie Mac based on loan counts as of October 2020. Single-family
seriously delinquent loans are 3 months or more past due or in the foreclosure process.
Increases in delinquencies to some extent reﬂect borrowers taking advantage of mortgage
forbearance provisions of the CARES Act but may also indicate ﬁnancial challenges facing
households that may not be captured by indicators of default. Moreover, while serious
delinquency rates on conventional loans, speciﬁcally those guaranteed by Fannie Mae and
Freddie Mac, improved slightly in recent months, delinquency rates on loans insured by the
Federal Housing Administration (FHA) still remain at near historically high levels. Increases in
delinquency rates on FHA loans in particular could indicate that minority and low-to-moderate
income households have experienced more ﬁnancial hardship since the onset of the pandemic as
FHA loans disproportionately serve minority and low-to-moderate income borrowers.68
Small business ﬁnancial and credit conditions. Trends in the Small Business Health Index
over the last year suggests that some aspects of the ﬁnancial condition of small business have
a provision (section 4021) to protect the credit of consumers who reach an agreement with their lenders to delay or
otherwise modify payments because of the COVID-19 pandemic.
68In ﬁscal year 2020, for example, 34.2 percent of all FHA purchase and reﬁnance borrowers were minorities, 50.4
percent of FHA forward mortgage borrowers were of low-to-moderate income, and 83.1 percent of home purchasers
under the FHA forward mortgage insurance program were ﬁrst-time homebuyers. See U.S. Department of Housing and
Urban Development, FHA Annual Management Report Fiscal Year 2020.
Page 53
GAO-21-387

returned to pre-pandemic levels. However, small businesses also have earned less income and
experienced signiﬁcantly greater diﬃculty accessing credit than before the pandemic. In addition,
small businesses in some sectors continue to make late payments on credit cards.69
The small business credit card delinquency index—a measure from Dun & Bradstreet of the
timeliness of credit payments of small businesses—weakened for 3 consecutive months beginning
in April 2020, but since then has returned to pre-pandemic levels. While the overall ability of small
businesses to make timely payments on credit cards improved compared to February 2020, small
businesses in some sectors, for example retail and mining and logging, had more late payment
compared to pre-pandemic levels (see ﬁgure). In addition, small business income—measured
by non-farm proprietors’ income from the Bureau of Economic Analysis—has been increasing
gradually since June 2020 but as of January 2021 remained lower than in February 2020.70
Changes in the Small Business Credit Card Delinquency Index by Sector, February 2020 through January 2021
Note: Other services include repair and maintenance, personal and laundry services, and membership associations and
organizations. The small business credit card delinquency index is published under license and with permission from Dun &
Bradstreet, and no commercial use can be made of these data.
While some aspects of the ﬁnancial condition of small businesses have improved compared
with a year ago, more banks have tightened rather than loosened underwriting standards on
the credit they have extended to small businesses for 4 consecutive quarters, beginning the ﬁrst
quarter of 2020, according to data collected by the Federal Reserve.71 In addition, more banks
have been raising rather than lowering the interest premiums they have charged on loans to
69The Small Business Health Index combines information on the timeliness of payments, failure rates, and utilization of
credit for a sample of over 10 million active small businesses with fewer than 100 employees. The Small Business Health
Index is published under license and permission from Dun & Bradstreet and no commercial use can be made of these
data.
70We excluded Paycheck Protection Program (PPP) loans to businesses from non-farm proprietors’ income. When
including PPP loans, small business income began increasing in May 2020, exceeded the pre-pandemic levels from
August through October, fell rapidly in November and December 2020, and remained lower than pre-pandemic levels as
of January 2021.
71Survey data from the Senior Loan Oﬃcer Opinion Survey, conducted by the Board of Governors of the Federal Reserve
System quarterly.
Page 54
GAO-21-387

small businesses over the same period. These changes indicate that banks anticipated greater risk
associated with making these loans going forward.
Corporate credit market conditions. Trends in corporate bond market risk over the last year
suggest that perceived risk among investment grade corporate borrowers and access to credit
for investment grade corporations have returned to pre-pandemic levels. Speciﬁcally, spreads on
investment grade corporate bonds increased dramatically starting in early March 2020, then fell
rapidly starting in late March 2020 (see ﬁgure), and since August of 2020 have returned to levels
that were typical during the past few years, prior to the pandemic.72
Spreads on Investment Grade Corporate Bonds, January 2019 through February 2021
Note: Corporate bond spreads are measured in basis points or 1/100th of a percentage point.
State and local government ﬁnances. State and local government ﬁscal conditions deteriorated
signiﬁcantly in the spring of 2020 as the national economy weakened and most states delayed
income tax ﬁling deadlines. Since this initial shock, total state and local government tax revenues
and access to credit via municipal bond markets have signiﬁcantly improved. In the aggregate,
state and local government expenditures remained steady during the pandemic while state and
local government employment is substantially lower than before the pandemic.
Based on Census Bureau data, tax revenue collected by state and local governments rose by $130
billion, on a seasonally adjusted basis, in the third quarter of 2020 after falling by over $69 billion
72Spreads on corporate bonds relative to benchmark interest rates (e.g., Treasury interest rates) measure the premium
corporate borrowers must pay to compensate lenders for taking on the risk of loss due to default (risk premium) and for
foregoing investments in more liquid assets (liquidity premium).
Page 55
GAO-21-387

in the second quarter (see ﬁgure).73 With the increase in the third quarter revenues, over the
ﬁrst three quarters of 2020 state and local tax revenues were similar to the same period in 2019.
Future tax revenues to state and local governments are likely to be sensitive to the strength of the
economic recovery.
State and Local Government Tax Revenue, First Quarter 2019 through Third Quarter 2020
Note: State and local tax revenues are seasonally adjusted.
Spreads on municipal bonds increased dramatically in March 2020, peaking on March 23, and
decreased gradually over the last year.74 As of February 2021, municipal bond spreads were
somewhat lower than their level as of February 2020, suggesting that perceived risk among
municipal borrowers and access to credit for state and local governments were somewhat
improved compared to pre-pandemic levels. In contrast, state and local government employment,
another timely indicator of state and local ﬁscal conditions, fell dramatically in the spring of 2020
and remains 1.4 million below levels in February 2020 as of February 2021 (see ﬁgure). In the
aggregate, state and local government expenditures remained steady during the pandemic,
reﬂecting higher spending on social beneﬁt payments but lower spending in other areas.75
73 See Quarterly Summary of State and Local Tax Revenues, Census Bureau. We use seasonally adjusted data to
compare changes in tax revenues from quarter to quarter. State and local governments also faced disruptions in the
timing of revenue collections. For example, most states extended their individual income tax ﬁling deadlines to match
the federal government’s shift in the deadline for ﬁling federal income tax returns from April 15 to July 15. It is not clear
how much of the second quarter decline or third quarter increase can be attributed to the delayed tax ﬁling deadline.
74Spreads on municipal bonds relative to benchmark interest rates (e.g., Treasury interest rates) incorporate
thefavorable tax treatment received by municipal debt and may also reﬂect any premium state and local borrowers
pay to compensate lenders for taking on the risk of loss due to default (risk premium) and for tying up their investment
funds for a period of time (liquidity premium). We report spreads calculated based on the Bloomberg Barclays Municipal
Bond Index. Spreads are calculated using yield to worst, which results in a conservative—that is, lower—estimate of
potential returns on callable bonds.
75State and local government expenditure data are from the Bureau of Economic Analysis National Income and Product
Accounts, Table 3.3.
Page 56
GAO-21-387

State and Local Government Employment, January 2019 through February 2021
Agency Comments
We provided the Department of Housing and Urban Development (HUD), the Department of Labor
(Labor), the Department of Treasury (Treasury), the Board of Governors of the Federal Reserve
System (Federal Reserve), the Federal Housing Finance Agency (FHFA), the Oﬃce of Management
and Budget (OMB), and the Small Business Administration (SBA) with a draft of this enclosure.
Labor and Treasury provided technical comments, which we incorporated as appropriate. HUD,
the Federal Reserve, FHFA, OMB, and SBA did not provide comments on this enclosure.
Methodology
To identify indicators for monitoring areas of the economy supported by the federal response
to the COVID-19 pandemic, in particular by the six COVID-19 relief laws, we reviewed prior GAO
work, data from federal statistical agencies, data from Fannie Mae and Freddie Mac, information
from the Federal Reserve and relevant federal agencies responsible for the pandemic response
and oversight of the health care system, data available on the Bloomberg Terminal, and input
from internal GAO experts. We reviewed the most recent data from these sources as of January or
February 2021, depending on availability.
We assessed the reliability of the economic indicators we used through a number of steps,
including reviewing relevant documentation, reviewing prior GAO work, and interviewing data
providers. Collectively, we determined the indicators were suﬃciently reliable to provide a general
sense of how the areas of the economy supported by the federal pandemic response were
performing.
Contact information: Lawrance L. Evans, Jr., (202) 512-8678, evansl@gao.gov
Page 57
GAO-21-387

Relief for Health Care Providers
The Department of Health and Human Services has not ﬁnalized and implemented a post-
payment review process to validate claims for the HRSA COVID-19 Claims Reimbursement to
Health Care Providers and Facilities for Testing, Treatment, and Vaccine Administration for the
Uninsured (COVID-19 Uninsured Program). As of March 1, 2021, it had disbursed a total of about
$120 billion (about 67 percent) of the $178 billion appropriated by COVID-19 relief laws for the
Provider Relief Fund to help support health care providers and ﬁnance care for COVID-19 patients
and underserved populations. The department also lent about $106.5 billion to health care
providers through a program expanded by the CARES Act.
Entities involved: Department of Health and Human Services, including its Centers for Medicare
& Medicaid Services and Health Resources and Services Administration
Recommendation for Executive Action
The Secretary of Health and Human Services should ﬁnalize and implement a post-payment
review process to validate COVID-19 Uninsured Program claims and to help ensure timely
identiﬁcation of improper payments, including those resulting from potential fraudulent activity,
and recovery of overpayments. HHS concurred with the recommendation and stated that it
anticipates, among other things, ﬁnalizing the audit review strategy with contractor support to
help ensure timely identiﬁcation of improper payments and recovery of overpayments.
Key Considerations and Future GAO Work
As the Department of Health and Human Services (HHS) works to get funds to eligible providers,
it will continue to be important that HHS oﬃcials remain attentive to establishing robust internal
controls to help ensure funds are appropriately disbursed and used. We plan to conduct
additional work to examine HHS’s eﬀorts to provide assistance to providers.
Background
Provider Relief Fund. To respond to the pandemic, three of the ﬁve COVID-19 relief laws enacted
as of March 1, 2021, appropriated $178 billion to reimburse eligible providers for health-care-
related expenses or lost revenues attributable to COVID-19, known as the Provider Relief Fund.
Speciﬁcally, the CARES Act appropriated $100 billion, the Paycheck Protection Program and Health
Care Enhancement Act appropriated $75 billion, and the Consolidated Appropriations Act, 2021,
appropriated $3 billion for this purpose.76 The Health Resources and Services Administration
(HRSA), within HHS, administers payments from the Provider Relief Fund, including allocations to
the COVID-19 Uninsured Program.
76Pub. L. No. 116-260, div. M, tit. III, 134 Stat. 1182, 1920 (2020); Pub. L. No. 116-139, div. B, tit. I, 134 Stat. 620, 622
(2020); Pub. L. No. 116-136, div. B, tit. VIII, 134 Stat. 281, 563 (2020).Additionally, the American Rescue Plan Act of 2021,
signed into law on March 11, 2021, appropriated $8.5 billion for payments to eligible rural health care providers for
health care-related expenses and lost revenues that are attributable to COVID–19. Pub. L. No. 117-2, § 9911, 135 Stat. 4,
236-38.
Page 58
GAO-21-387

Accelerated and Advance Payments Program. HHS’s Centers for Medicare & Medicaid Services’
(CMS) Accelerated and Advance Payments Program provides loans to providers and suppliers
when there is a disruption in claims submission or processing, including during a public health
emergency or a presidentially declared disaster.77 Section 3719 of the CARES Act authorized the
expansion of this program due to the COVID-19 pandemic. Under the expanded program, active
Medicare providers and suppliers could apply for loans of up to 100 percent or 125 percent of
the Medicare payments they received for a prior 3-month or 6-month period, depending on the
type of provider or supplier. On April 26, 2020, CMS announced that provider applications for
the Advance Payments Program were discontinued in light of grant payments made available for
similar purposes through the Provider Relief Fund. As of October 8, 2020, CMS stopped accepting
applications for accelerated or advance payments as they relate to the COVID-19 Public Health
Emergency, although CMS will continue to monitor the ongoing impacts of COVID-19 on the
Medicare provider and supplier community.
Overview of Key Issues
Provider Relief Fund. As of March 1, 2021, HHS had allocated about $154 billion from the
Provider Relief Fund, with about $24 billion not yet allocated.78 Of the total $154 billion allocated,
about $120 billion had been disbursed and about $34 billion was yet to be disbursed. According
to HHS oﬃcials, the agency allocated about $77 billion for general relief for health care providers
and about $57 billion for targeted areas. See table below for a summary of Provider Relief Fund
allocations and disbursements.
77The Accelerated Payments Program provides loans to Part A providers and the Advance Payments Program provides
loans to Part B suppliers.
78HHS uses the term “allocations” to describe the funding amounts it has set aside for particular purposes or for
particular types of health care providers.
Page 59
GAO-21-387

Summary of the Provider Relief Fund ($178 billion) Allocations and Disbursements, as of March 1, 2021
Description
Allocation
($ billions)
Date of initial
disbursement
Disbursement
($ billions)
General distributions
Phase I: Medicare
46.016
April 10, 2020
41.971
Phase II: Medicaid and Children’s Health
Insurance Program (CHIP) providers
4.067
July 3, 2020
3.143
Phase II: dental providers
1.290
July 28, 2020
0.978
Phase III: assisted living facilities
0.627
September 25, 2020
0.299
Phase III: general distribution
24.500
November 14, 2020
14.393
Subtotal of general distributions
76.500
60.784
Targeted distributions
Rural health care facilities
11.092
May 6, 2020
10.963
High-impact hospitals
20.750
May 7, 2020
20.668
Skilled nursing facilities
5.000
May 22, 2020
4.761
Indian health care providers
0.520
May 29, 2020
0.509
Safety net hospitals
13.074
June 12, 2020
12.907
Children’s hospitals
1.063
August 20, 2020
1.062
Nursing home infection control, quality, and
performance
5.000
August 27, 2020
4.405
Subtotal of targeted distributions
56.499
55.275
Subtotal of general and targeted distributions
132.999
116.059
Other
Treatment and testing of the
uninsured/vaccine administration
10.000
May 15, 2020
2.165
Vaccine and therapeutic development
and procurement activities
9.970
November 25, 2020
1.664
Administration
0.980
n/a
0.036
Unallocated fundsa
24.051
n/a
0.000
Page 60
GAO-21-387

Description
Allocation
($ billions)
Date of initial
disbursement
Disbursement
($ billions)
Total
178.000
119.924
Legend: n/a = not applicable
Source: Summary of Health and Human Services funding data. | GAO-21-387
aHealth Resources and Services Administration (HRSA) oﬃcials told us that the amount of unallocated funds/uninsured
treatment/vaccine administration is available for treatment of the COVID-19 Uninsured Program and for other Provider Relief
Fund allocations.
Summary of fund disbursements. As of March 1, 2021, about $120 billion of the approximately $154
billion allocated from the Provider Relief Fund had been disbursed. The amount disbursed was
less than the amount allocated because some of the disbursements were in progress and some of
the funds were returned. HRSA oﬃcials told us that the returned funds are reﬂected in the above
table. According to our analysis of information provided by HRSA, as of March 1, 2021, HHS had
disbursed about $61 billion from general distribution allocations and about $55 billion from the
targeted allocations.
From April 10, 2020, the date of the initial disbursement, to May 31, 2020, about $65 billion was
disbursed. Funds were disbursed at a slower pace in the subsequent nine months through March
1, 2021. An additional $9.5 billion was disbursed during those months at an average monthly
disbursement of $4.8 billion. HRSA oﬃcials told us that this slowdown reﬂected in part the fact
that funds allocated through the General Distribution during that time required providers to
submit applications that HRSA reviewed.
Payments returned to Provider Relief Fund. According to HRSA, providers had declined about $8
billion from previous disbursements as of February 26, 2021. HRSA oﬃcials told us that those
funds are available for subsequent allocations.79 According to our analysis of information provided
by HRSA, 74 percent of the returned funds were from general distributions and 26 percent are
from targeted distributions. About $4.4 billion was returned to HRSA after being disbursed as
part of the ﬁrst general allocation, Phase 1–Medicare. This amount is approximately 73 percent of
all returned funds. About $1.2 billion was returned after being disbursed as part of the targeted
allocation for High-Impact Hospitals. This amount is approximately 19 percent of all returned
funds. Some providers returned funds because they were not needed. For example, a large health
system headquartered in California returned all but one small disbursement, including funds
from the Medicare, High-Impact, Skilled Nursing, and Nursing Home Infection Control allocations
totaling to about $771 million. The health system stated in a press release that it was able to
return the majority of funds due to actions taken to manage expenses.
COVID-19 treatment of uninsured. The Provider Relief Fund includes an allocation for the COVID-19
Uninsured Program, although the total amount to be used for this program has not yet been
79The Consolidated Appropriations Act, 2021, provided that not less than 85 percent of Provider Relief Fund funds
unobligated as of the date of enactment and funds recovered from providers after the date of enactment shall be
for any successor to the Phase 3 General Distribution to reimburse health care providers based on applications that
consider ﬁnancial losses and changes in operating expenses attributable to COVID-19 occurring in the third and fourth
quarters of 2020 and the ﬁrst quarter of 2021.
Page 61
GAO-21-387

determined by HHS oﬃcials.80 As of March 1, 2021, approximately $2.2 billion from the Provider
Relief Fund had been disbursed for COVID-19 treatment, testing, and vaccine administration of
uninsured individuals. As of March 1, 2021, over 25 million claims have been paid. HRSA oﬃcials
reported that future disbursements for this purpose will come out of the approximately $24 billion
remaining in unallocated funds in the Provider Relief Fund.
Providers who choose to participate in this program must attest to its terms and conditions, which
include that the individual treated, tested, or administered a vaccine is uninsured, the provider
will accept reimbursement as payment in full, and the provider will not bill the individual for the
balance of the bill. Reimbursement is generally available at Medicare rates for treating uninsured
individuals with a COVID-19 diagnosis as well as the testing and administration of a licensed or
authorized COVID-19 vaccine to uninsured individuals.
HRSA has not yet ﬁnalized and implemented a post-payment review process to validate COVID-19
Uninsured Program provider claims. HRSA’s risk assessment identiﬁed a risk that COVID-19
Uninsured Program providers may falsify patient rosters.81 In response to this risk, HRSA stated
that providers must attest services were rendered to an uninsured patient. Under the COVID-19
Uninsured Program terms and conditions, HRSA can recover overpayments made for instances
of provider non-compliance. HRSA intends to perform post-payment reviews of claims to
validate certain provider attestations, according to agency oﬃcials. However, HRSA did not have
documentation describing how it plans to conduct these reviews, such as review plans, standard
operating procedures, or staﬀ manuals, and the factors and criteria to be used for selecting and
assessing the validity of selected provider claims.
Agency oﬃcials stated that the agency has been focused on prepayment processes and launching
the Provider Relief Fund reporting portal. According to HRSA oﬃcials, the agency is working with a
contractor to develop and recommend a post-payment audit strategy with phased implementation
to begin in late calendar year 2021. Although we acknowledge that in emergency situations,
such as the COVID-19 pandemic, agencies must implement programs and disburse certain relief
funds quickly, strong internal controls help ensure that relief funds are used for only authorized
purposes. Additionally, it is important for agencies to recover overpayments as quickly as possible.
80In addition to the allocation from the Provider Relief Fund for treatment and vaccine administration of uninsured
individuals, the Families First Coronavirus Response Act and the Paycheck Protection Program and Health Care
Enhancement Act each appropriated $1 billion to reimburse providers for the testing of uninsured individuals. Pub. L.
No. 116-127, div. A, tit. V, 134 Stat.178, 182 (2020); Pub. L. No. 116-139, div. B., tit. I, 134 Stat.at 626 (2020). These funds
are also administered by HRSA as part of the COVID-19 Uninsured Program. According to HRSA oﬃcials, these funds
have been depleted; therefore, HRSA will continue to reimburse COVID-19 testing claims to the COVID-19 Uninsured
Program using Provider Relief Fund funding.
81The Oﬃce of Management and Budget (OMB) Circular No. A-123, Management’s Responsibility for Enterprise Risk
Management and Internal Control, requires executive agencies to evaluate the risks to accomplishing their strategic,
operations, reporting, and compliance objectives and provide an annual Statement of Assurance that represents
the agency head’s informed judgment as to the overall adequacy and eﬀectiveness of the agency’s internal control.
Accordingly, HRSA developed an A-123 risk assessment to identify and assess COVID-19 Uninsured Program risks and
identify internal control activities in response to such risks as of September 30, 2020.
Page 62
GAO-21-387

Federal internal control standards state that management should design control activities to
achieve objectives and respond to risks and implement control activities through policies.82 As
part of these standards, management designs speciﬁc actions to respond to the analyzed program
risks on a timely basis, including the potential for fraud, and clearly documents internal controls in
a manner that allows the documentation to be readily available for examination.
Without documented post-payment review policies and procedures and timely implementation of
related control activities, HRSA’s ability to consistently identify and recover improper payments,
including those resulting from potential fraudulent activity, will be limited. As a result, for those
payments identiﬁed as an overpayment, HRSA’s eﬀorts to recover them will be delayed, if they are
recovered at all.
Single Audit Requirements. The Single Audit Act establishes requirements for states, the District
of Columbia, local governments, U.S. territories, tribal governments, and nonproﬁt organizations
that receive federal awards to undergo single audits of those awards annually (unless a speciﬁc
exception applies), when their expenditures of the award meet a certain dollar threshold.83 In its
single audit implementing regulations, HHS further requires commercial (for-proﬁt) organizations
that meet a certain dollar threshold to undergo: (1) an audit in conformance with single audit
requirements or (2) a ﬁnancial related audit of the applicable award(s) in accordance with
Generally Accepted Government Auditing Standards.84 These audits are critical to helping to
identify deﬁciencies in the award recipient’s compliance with applicable provisions of laws,
regulations, contracts, or grant agreements and in its ﬁnancial management and internal control
systems. Correcting such deﬁciencies can help ensure the appropriate use of federal funds and
reduce the likelihood of federal improper payments.
Auditors who conduct single audits follow guidance in the Oﬃce of Management and Budget’s
(OMB) Compliance Supplement and agency guidance (e.g., FAQs) speciﬁc to their programs. The
Provider Relief Fund reimburses health care providers for health-care-related expenses or lost
revenues attributable to COVID-19. An auditor’s review of such reported health care expenditures
and lost revenues may be a critical component of a Provider Relief Fund recipient’s single audit.85
82GAO, Standards for Internal Control in the Federal Government, GAO-14-704G (Washington, D.C.: September 10, 2014).
83Single Audit Act, codiﬁed, as amended, at 31 U.S.C. §§ 7501 - 7506, and implementing OMB guidance reprinted in 2
C.F.R. part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Federal
award recipients that expend $750,000 or more in federal awards in a ﬁscal year are required to undergo a single audit,
which is an audit of an entity’s ﬁnancial statements and federal awards, or a program-speciﬁc audit, for the ﬁscal year.
31 U.S.C. § 7502; 2 C.F.R. § 200.501. HHS has implemented OMB’s Single Audit Act guidance at 45 C.F.R. part 75, Uniform
Administrative Requirements, Cost Principles, and Audit Requirements for HHS Awards. See, e.g., 45 C.F.R. § 75.501.
84For-Proﬁt reporting entities that received $750,000 or more in annual aggregated HHS awards (including Provider
Relief Fund payments) during their ﬁscal year are subject to audit requirements, as set forth in HHS’s single audit
regulations at 45 C.F.R. §§ 75.216, 75.501.
85According to HHS guidance, HHS executed agreements with all Provider Relief Fund recipients (regardless of whether
they are subject to the Single Audit Act) that included a set of terms and conditions that included special requirements
regarding submitting reports related to the Provider Relief Fund to HHS consistent with applicable HHS reporting
instructions. HHS most recently issued guidance providing instructions on these special reporting requirements in
January 2021. That guidance stated that Provider Relief Fund recipients must report whether they are subject to single
audit requirements during the current ﬁscal year, and, if yes, whether the auditors selected Provider Relief Fund
payments to be within the scope of the single audit (if known at the time the recipient submits its report). According to
Page 63
GAO-21-387

Per the December 2020 Compliance Supplement Addendum, Provider Relief Fund expenditures
(including lost revenues) will ﬁrst be reported in the Schedule of Expenditures of Federal Awards
(SEFA) and audited under OMB’s single audit guidance in ﬁscal years ending on or after December
31, 2020. However, for those entities with ﬁscal years ending on or after June 30, 2021, SEFA
reporting guidance will be in the 2021 Compliance Supplement. As we previously reported, delays
in issuing guidance could adversely aﬀect auditors and the results and timing of their work, and
may lead to inconsistent reporting. (See Single Audit enclosure for recommendation to OMB.)
Accelerated and Advance Payments Program. Under the expanded Accelerated and Advance
Payments Program, amended by the CARES Act, CMS made accelerated and advance payments
totaling about $107.3 billion as of January 12, 2021. Initially, recoupment of the accelerated and
advance payments, through the oﬀsetting of new Medicare claims, was to begin not more than
120 days after the funds were disbursed. Thus, recoupment was scheduled to begin in late July
2020.
However, the Continuing Appropriations Act, 2021 included a provision that delayed repayment
until 1 year after the accelerated or advance payment was made, with recoupment of Medicare
payments owed to providers beginning at 25 percent for the ﬁrst 11 months, and at 50 percent for
the following 6 months.86 Accordingly, the provision allows 29 months from the date of the ﬁrst
payment to a provider or a supplier before requiring that the outstanding balance be paid in full.
As of January 12, 2021, providers had voluntarily repaid about $8.4 billion and the outstanding
loan balance in the Accelerated and Advance Payments Program was about $98.9 billion.
Agency Comments
We provided HHS and OMB with the draft of this enclosure. HHS provided technical comments
on this enclosure, which we incorporated as appropriate. HHS provided written comments,
reproduced in Appendix VI and technical comments, which we incorporated as appropriate. OMB
did not provide any comments on this enclosure.
HHS agreed with our recommendation to ﬁnalize and implement a post-payment review process.
As part of implementing this process, HHS stated that it will, with contractor support, ﬁnalize
the audit review, pilot and test the post-payment audit review process, and validate COVID-19
Uninsured Program claims to help ensure timely identiﬁcation of improper payments and recovery
of overpayments. We urge HHS to implement this post-payment review process as expeditiously
as possible.
Methodology
To conduct our work, we examined publicly released HHS information, federal laws and
regulations, OMB’s single audit guidance, and obtained information from CMS and HRSA in the
OMB’s Compliance Supplement Addendum, auditors should test compliance with these special reporting requirements
for audits of Provider Relief Fund recipients with ﬁscal years ending on or after December 31, 2020.
86Pub. L. No. 116-159, § 2501, 134 Stat. 709, 733 (2020).
Page 64
GAO-21-387

form of written responses to questions, documents, and datasets. Our review of the data sources
provides reasonable assurance of the data’s reliability. The Provider Relief Fund dataset came from
HRSA, which is the only available source for the disbursement data. The allocation amounts and
categories that were provided by HRSA match publicly available information.
Contact information: Carolyn L. Yocom, (202) 512-7114, yocomc@gao.gov
Page 65
GAO-21-387

Nursing Homes
After peaking in December 2020, rates of new COVID-19 cases and deaths in nursing homes have
declined; however, additional data related to COVID-19 vaccinations in nursing homes is needed.
Staﬃng in nursing homes also continues to be a concern.
Entities involved: Centers for Disease Control and Prevention and Centers for Medicare &
Medicaid Services, both within the Department of Health and Human Services.
Recommendations for Executive Action
The Secretary of Health and Human Services should ensure that the Director of the Centers
for Disease Control and Prevention collects data speciﬁc to the COVID-19 vaccination rates in
nursing homes and makes these data publicly available to better ensure transparency and that the
necessary information is available to improve ongoing and future vaccination eﬀorts for nursing
home residents and staﬀ. HHS neither agreed nor disagreed with this recommendation.
The Secretary of Health and Human Services should ensure that the Administrator of the Centers
for Medicare & Medicaid Services, in consultation with the Centers for Disease Control and
Prevention, requires nursing homes to oﬀer COVID-19 vaccinations to residents and staﬀ and
design and implement associated quality measures. HHS neither agreed nor disagreed with this
recommendation.
Key Considerations and Future GAO Work
We have previously made two recommendations related to COVID-19 outbreaks in nursing homes:
• In September 2020, we recommended that the Secretary of Health and Human Services, in
consultation with the Centers for Medicare & Medicaid Services (CMS) and the Centers for
Disease Control and Prevention (CDC), develop a strategy to capture more complete data on
conﬁrmed COVID-19 cases and deaths in nursing homes retroactively back to January 1, 2020,
and clarify the extent to which nursing homes had reported data before May 8, 2020.
Although the Department of Health and Human Services (HHS) partially agreed with this
recommendation, as of February 2021, this recommendation had not been implemented.
• In November 2020, we recommended that the Administrator of CMS quickly develop a plan
that further detailed how the agency intended to respond to and implement, as appropriate,
the 27 recommendations in the ﬁnal report of the Coronavirus Commission on Safety and
Quality in Nursing Homes, which CMS released on September 16, 2020.87
HHS neither agreed nor disagreed with our recommendation; instead, it highlighted actions
that CMS has taken related to Commission recommendations and indicated that it would refer
87MITRE, Coronavirus Commission on Safety and Quality in Nursing Homes: Commission Final Report, PRS Release
Number 20-2382, September 2020.
Page 66
GAO-21-387

to and act upon the Commission’s recommendations as appropriate. As of February 2021,
CMS had no additional updates.
We maintain the importance of our recommendations. Speciﬁcally, we maintain that collecting
data on COVID-19 cases and deaths from nursing homes retroactively would better inform
the government’s continued response and recovery, and we maintain that HHS could ease the
burden by incorporating data previously reported to CDC or to state or local public health oﬃces.
Additionally, we maintain that developing a plan for whether and how CMS will proceed with the
Commission’s recommendations would improve the agency’s ability to systematically consider the
Commission’s recommendations going forward.
In this enclosure, we note additional concerns particularly around the availability of nursing home
vaccination data. Further, we have ongoing work on the oversight of infection prevention and
control and emergency preparedness in nursing homes.
Background
The health and safety of the 1.4 million elderly or disabled residents in the nation’s more than
15,000 Medicare- and Medicaid-certiﬁed nursing homes—who are often in frail health and living in
close proximity to one another—has been a particular concern during the COVID-19 pandemic.88
CMS, an agency within HHS, is responsible for ensuring that nursing homes meet federal quality
standards to participate in the Medicare and Medicaid programs. To monitor compliance with
these standards, CMS enters into agreements with state survey agencies within each state
to conduct inspections, including recurring comprehensive standard surveys and as-needed
investigations.
The CARES Act appropriated $100 million for this oversight, and it directed CMS to prioritize
the use of funds for nursing home facilities in localities with community transmission of
COVID-19.89 According to CMS, of this amount, the agency plans to provide state survey agencies
approximately $81 million through September 30, 2023, to be used to ensure that all nursing
homes receive targeted infection control surveys, among other things.90 CMS has set aside the
remaining $19 million to enhance survey system technology, to fund PPE for federal surveyors,
and to implement improvements recommended by the Nursing Home Commission, according to
the agency.91
88COVID-19 has aﬀected vulnerable populations in other settings beyond nursing homes, including assisted living
facilities. However, as the federal role in oversight of nursing homes is more signiﬁcant than in other settings such as
assisted living facilities, the federal response has been more focused on nursing homes.
89Pub. L. No. 116-136, div. B, tit. VIII, 134 Stat. 281, 557 (2020).
90According to CMS, as of September 30, 2020, it obligated almost $19 million. In ﬁscal year 2021, the agency indicated it
plans to obligate about $28 million.
91Additionally, the American Rescue Plan Act of 2021 appropriated $250 million for the creation of state strike teams
that will be deployed to nursing facilities with diagnosed or suspected cases of COVID–19 among residents or staﬀ for
the purposes of assisting with clinical care, infection control, or staﬃng during the COVID-19 emergency period and the
following year. Pub. L. No. 117-2, § 9818, 135 Stat. 4, 218.
Page 67
GAO-21-387

In addition, HHS announced in May 2020 that it would contribute $4.9 billion from the Provider
Relief Fund, established with funds provided under COVID-19 relief laws to reimburse eligible
providers for health care-related expenses or lost revenues attributable to COVID-19, as direct
payments to assist nursing homes with responding to COVID-19.92 In July, HHS announced that it
would provide an additional $5 billion from the fund. HHS later announced that $2.25 billion from
the fund would be dedicated to establishing an incentive-based program—the Quality Incentive
Payment Program—to reward nursing homes that create and maintain safe environments for
their residents. Payments would be made to nursing homes for their eﬀorts to reduce COVID-19
infection and mortality rates among residents, based on CDC data. According to HHS, as of March
1, 2021, it awarded approximately $1.9 billion in four rounds.
In response to the pandemic, HHS, primarily through CMS and CDC, has taken a range of actions
to address infection prevention and control in nursing homes, which we reported on in our
previous reports from June, September, and November 2020 and January 2021. One recent action
in October 2020 was to establish the Pharmacy Partnership for Long-Term Care Program, an
agreement with pharmacy partners to conduct COVID-19 vaccination clinics for residents and
staﬀ of long-term care facilities, including nursing homes, to minimize the burden on facilities and
jurisdictional health departments.93
Overview of Key Issues
COVID-19 cases and deaths in nursing homes. According to CDC case-reporting data, as of
February 7, 2021, more than 99 percent of Medicare- and Medicaid-certiﬁed U.S. nursing homes
had reported at least one conﬁrmed resident or staﬀ case, and more than 80 percent had
reported at least one resident or staﬀ COVID-19 death.94 New weekly conﬁrmed cases of COVID-19
in nursing homes ﬂuctuated but generally remained under 12,000 new cases until late 2020
when weekly cases increased considerably reaching over 25,000. (See ﬁgure.) Speciﬁcally, new
weekly resident cases peaked the week ending December 20, 2020, at more than 33,600 resident
cases—178 percent higher than the previous peak for the week ending July 26, 2020. New weekly
staﬀ cases peaked one week prior with over 28,600 staﬀ cases for the week ending December 13,
2020—141 percent higher than the week ending July 26, 2020. Since then cases have again been
declining.95
92Speciﬁcally, the CARES Act appropriated $100 billion, the Paycheck Protection Program and Health Care Enhancement
Act appropriated $75 billion, and the Consolidated Appropriations Act, 2021, appropriated $3 billion for this purpose.
Pub. L. No. 116-260, div. M, tit. III, 134 Stat. 1182, 1920 (2020); Pub. L. No. 116-139, div. B, tit. I, 134 Stat. 620, 622 (2020);
Pub. L. No. 116-136, div. B, tit. VIII, 134 Stat. 281, 563 (2020).
93As part of the program, vaccines will be provided with no out-of-pocket costs for residents or staﬀ, or costs to the
facilities. The pharmacy partners—including CVS, Walgreens, and Managed Health Care Associates Inc.—will schedule
and coordinate on-site vaccination clinic dates; order vaccines and associated supplies; ensure cold chain management
for the vaccine; provide on-site administration; report required vaccination data to local, state, and federal jurisdictions;
and adhere to all applicable CMS COVID-19 testing requirements for facility staﬀ.
94CDC deﬁnes a conﬁrmed case as having a positive COVID-19 test resulting from a molecular test, a nucleic acid test, or
an antigen test, including antigen point-of-care test results.
95These numbers are likely underreported because they do not include data for the 998 nursing homes (6.5 percent)
that did not report COVID-19 data to CDC for the week ending February 7, 2021, or that submitted data that failed data
quality assurance checks. The week ending May 31, 2020, is the ﬁrst single week of data reported to CDC. The only
Page 68
GAO-21-387

New weekly resident deaths also saw an increase in late November, eventually reaching a new
peak of 6,019 for the week ending December 20, 2020—about 72 percent higher than the previous
peak the week ending May 31, 2020. Combined nursing home resident and staﬀ deaths from
COVID-19, as a percentage of total COVID-19 deaths in the U.S., remained largely unchanged
throughout this time period (consistently making up about 30 percent of all COVID-19 deaths
in the U.S.). The changing weekly COVID-19 death counts in nursing homes generally paralleled
changes in the country as a whole.
earlier week of data, for the week ending May 24, could potentially include cases and deaths for multiple weeks dating
back to January 1, 2020, for those homes which voluntarily reported such data, and is therefore not comparable with
data for other weeks. According to CDC, data used in this analysis are part of a live data set, meaning that facilities can
make corrections to the data at any time. Data presented in this enclosure reﬂect the data downloaded as of February
18, 2021, which includes data through the week ending February 7, 2021.
Page 69
GAO-21-387

New Weekly Conﬁrmed COVID-19 Cases and Deaths among U.S. Nursing Home Residents and Staﬀ, as Reported
by Medicare- and Medicaid-Certiﬁed Nursing Homes, Weeks Ending May 31, 2020, through February 7, 2021
Notes: Dates refer to the end of a week (e.g., May 31 refers to the entire week from May 25 through May 31).
According to CDC, data used in this analysis are part of a live data set, meaning that facilities can make corrections to the data
at any time. Data presented in this enclosure reﬂect the data downloaded as of February 18, 2021, which includes data through
the week ending February 7, 2021. We excluded data for the week ending May 24, 2020, because it is the ﬁrst week for which
data are available from the Centers for Disease Control and Prevention (CDC) and could include cases and deaths from multiple
weeks dating back to January 1, 2020.
Weekly and cumulative case and death counts are likely underreported because they do not include data for the nursing homes
that did not report COVID-19 data to CDC for that week or from nursing homes that submitted data that failed data quality
assurance checks. Additionally, as we previously reported, the Centers for Medicare & Medicaid Services (CMS) does not require
nursing homes to report data prior to May 2020, although nursing homes may do so voluntarily. We recommended that the
Secretary of Health and Human Services—in consultation with CMS and CDC—develop a strategy to capture more complete
data on conﬁrmed COVID-19 cases and deaths in nursing homes retroactively to January 1, 2020.
Weekly staﬀ deaths reported for the weeks ending May 31, 2020, through February 7, 2021, ranged from 13 (week ending
September 20) to 61 (week ending May 31).
Page 70
GAO-21-387

Vaccination clinics for nursing home residents and staﬀ oﬀered through the pharmacy
partnership near completion. The ﬁrst vaccinations were administered to nursing home
residents beginning in mid-December 2020, and CDC announced that the ﬁrst round of on-site
vaccine clinics, conducted through the Pharmacy Partnership for Long-Term Care Program, were
completed in 99 percent of nursing homes by late January. The pharmacy partnership program,
announced in October 2020, was responsible for much of the administration of vaccinations in
nursing homes, as well as in other long-term care facilities. (See table below for a timeline of key
dates.)
Page 71
GAO-21-387

Key Dates in Roll Out of Vaccinations for Nursing Homes
Date
Milestone
October 2020
• October 16: Pharmacy Partnership for Long-Term Care Program announced by HHS
•
Agreement with CVS, Walgreens, and Managed Health Care Associates to provide
and administer COVID-19 vaccines to residents of long-term care facilities,
including nursing homes
•
Manages the COVID-19 vaccination process, including storage, administration,
and reporting, to minimize the burden on facilities and jurisdictional health
departmentsa
December 2020
• December 1: CDC’s Advisory Committee on Immunization Practices recommended
prioritizing nursing home residents for vaccinations, in addition to health care personnel
and other residents of long-term care facilities
• December 3: CDC Director accepted the advisory committee’s recommendation for priority
groups for the initial phase of the COVID-19 vaccination program
• December 11: Food and Drug Administration authorized the emergency use of the Pﬁzer-
BioNTech vaccine
• December 18: Food and Drug Administration authorized the emergency use of the
Moderna vaccine
• December 18: First vaccine doses were administered to nursing home residents and staﬀ
members in two trial states—Connecticut and Ohio
• December 21: Vaccinations through the Pharmacy Partnership for Long-Term Care
Program begin
January 2021
• January 4: All 54 jurisdictions that elected to participate in the Pharmacy Partnership for
Long-Term Care Program had started the vaccination process
• January 25: 99 percent of nursing homes participating in the Pharmacy Partnership for
Long-Term Care Program completed their ﬁrst clinics by the end of the week
February 2021
• Early February: Continued third, and ﬁnal, on-site vaccination clinics at nursing homes
participating in the Pharmacy Partnership for Long-Term Care Program
Source: GAO analysis of information from the Department of Health and Human Services. | GAO-21-387
aThere are 64 jurisdictions which include all U.S. states and territories and some local health programs.
According to CDC and nursing home association oﬃcials, the Pharmacy Partnership for Long-Term
Care Program is making progress towards its intended goals, speciﬁcally its goal to vaccinate the
long-term care populations, including nursing home residents. According to CDC, the pharmacy
partnership aimed to complete ﬁrst vaccination clinics within 4 weeks of starting clinics in a
jurisdiction.96 Vaccination clinics began the week of December 21, 2020, and CDC reports that,
96Through the Pharmacy Partnership for Long-Term Care Program, partner pharmacies conduct three, temporary, on-
site vaccination clinics per enrolled facility for nursing home residents and staﬀ.
Page 72
GAO-21-387

as of January 25, 2021, ﬁrst vaccination clinics were completed in 99 percent of nursing homes.
Additionally, the nursing home associations we interviewed were pleased that nursing homes were
prioritized and acknowledged that vaccinating the entire nursing home population was a massive
undertaking that was generally successful.
Another goal of the partnership was to reduce the burden on facility staﬀ. The two nursing home
associations we interviewed indicated satisfaction with the pharmacy partnership on this goal as
well. Oﬃcials from one of the associations noted that the burden on their member facilities was
lessened by having the pharmacy partnership responsible for some of the administrative tasks
associated with administering the vaccines.
According to nursing home association and state and local health department oﬃcials, the
Pharmacy Partnership for Long-Term Care Program faced some challenges during the initial
launch of the program. Key challenges have included a shift from federal to state control of the
program, resident vaccination consent issues, and staﬀ members’ reluctance to be vaccinated,
among others.97
• Decentralization of the Pharmacy Partnership for Long-Term Care. The two nursing home
associations we interviewed said that some of the diﬃculties implementing the partnership
program stemmed from the fact that the program is a state-controlled program, though it was
originally designed to be a federal program. The federal government entered into agreements
with the pharmacy partners and required facilities to sign up to participate in the partnership.
However, each state is responsible for activating the partnership and allocating doses from the
state’s overall allocation from the federal government.98 Thus, vaccinations by the pharmacy
partners cannot begin until the state activates the agreement and allocates doses to the
pharmacy partners. According to state and nursing home association oﬃcials, this resulted in
more than 50 diﬀerent plans for implementation, which caused confusion among jurisdictions’
health departments, nursing homes, and pharmacy partners and hampered communication
and vaccine education eﬀorts. The oﬃcials said a more centralized distribution model may
have created a more eﬃcient approach to vaccinating the nursing home population.
• Obtaining resident consent. The state and nursing home association oﬃcials noted confusion
and diﬃculties obtaining consent from nursing home residents and their families to
administer the vaccine, indicating that pharmacy partners in some cases wanted to gather
written consent from residents before administering the vaccines. According to the CDC,
written consent is not required by federal law for COVID-19 vaccination, but pharmacy
partners that are administering the vaccine in long-term care facilities have the discretion
to require verbal, email, or written consent from recipients.99 Initial attempts to gather
97Other challenges mentioned by oﬃcials from two nursing home associations include initial scheduling and
coordination challenges between nursing home facilities and pharmacy partners, as well as shortages in pharmacy staﬀ
to conduct the vaccination clinics.
98Allocation of COVID-19 doses was originally done based in direct proportion to the nation's adult population 18
years and older. States and jurisdictions order against weekly allocations provided by CDC. States determine the
number of doses to direct to the pharmacy partnership from their weekly allocations.
99CDC also notes that pharmacy partners will work with long-term care facilities to ensure that staﬀ and residents
who receive the vaccine also receive an emergency use authorization fact sheet. Under the terms of the COVID-19
Page 73
GAO-21-387

written consent may have delayed the start of vaccination clinics at some locations, though
association oﬃcials said that once the pharmacies accepted informed consent, this was no
longer an issue.
• Staﬀ reluctance to be vaccinated. The state and nursing home association oﬃcials indicated
that, while vaccine take-up rates among residents were high, take-up rates for staﬀ
vaccinations were much lower, making it diﬃcult for facilities to predict how many vaccine
doses were needed.100 The oﬃcials attributed staﬀ reluctance to be vaccinated to several
factors, including the challenge of convincing people to be the ﬁrst to take a quickly developed
vaccine, underlying issues of government mistrust, myths spread on social media, and the
initial lack of information resources on vaccine safety. CDC responded to concerns about
vaccination hesitancy by increasing the availability of materials to better inform and empower
health care providers, including a communications toolkit with messages and strategies to
combat hesitancy.
Detailed data for nursing home resident and staﬀ vaccinations is not publicly reported
, making it diﬃcult to monitor ongoing vaccination eﬀorts and nursing home quality.
According to CDC, approximately 4.25 million vaccine doses were administered to residents
and staﬀ in nursing homes through the Pharmacy Partnership for Long-Term Care Program,
as of February 11, 2021—79 percent of all doses administered through the partnership.101 See
table below. According to detailed data that we obtained from CDC, as of February 11, 2021, the
program has completed 13,433 ﬁrst vaccination clinics, 11,975 second vaccination clinics, and
2,340 third vaccination clinics in nursing homes.102
vaccine emergency use authorizations issued as of January 31, 2021, vaccine providers must inform recipients or
their caregivers that the vaccine is not approved by FDA but has been authorized for emergency use and that the
recipient or their caregiver has the option to accept or refuse the vaccine, among other things.
100According to a recent CDC analysis, during the ﬁrst month of the Pharmacy Partnership for Long-Term Care
Program, an estimated median of 77.8 percent of residents and an estimated median of 37.5 percent of staﬀ
members per facility received a dose of COVID-19 vaccine at the ﬁrst vaccination clinics. See R. Gharpure et al.,
“Early COVID-19 First-Dose Vaccination Coverage Among Residents and Staﬀ Members of Skilled Nursing Facilities
Participating in the Pharmacy Partnership for Long-Term Care Program—United States, December 2020-January
2021,” Centers for Disease Control and Prevention Morbidity and Mortality Weekly Report, vol. 70 (Feb. 1, 2021).
Anecdotally, oﬃcials from one nursing home association said take-up rates for staﬀ have improved for facilities that
have completed their second clinics.
101The remaining doses were administered in other long-term care settings, such as assisted living facilities. According
to CDC’s vaccine distribution and administration tracking website, doses administered refers to vaccine administered to
long-term care facility residents and staﬀ, as reported to CDC by the pharmacy partners participating in the Pharmacy
Partnership for Long-Term Care Program. These data do not include doses administered to long-term care facility
residents and staﬀ outside this partnership. As of January 4, 2021, a total of 54 out of 64 jurisdictions have started the
program. Program start dates varied based on the jurisdiction. The 64 jurisdictions include all U.S. states and territories
and some local health programs.
102According to CDC, some jurisdictions have requested that pharmacy partners do not initiate ﬁrst dose vaccinations
to residents and staﬀ at the third—and ﬁnal—clinics, due to their future plans to vaccinate nursing home residents and
staﬀ using a diﬀerent vaccine product. This may hinder vaccination take-up rates on the part of staﬀ members who did
not get the vaccine at previous clinics but are now wanting the vaccine after seeing colleagues and others get the vaccine
without complications.
Page 74
GAO-21-387

COVID-19 Vaccinations Conducted in Nursing Homes through the Pharmacy Partnership for Long-Term Care
Program by Recipient Type, as of February 11, 2021
Recipient
Number receiving a ﬁrst dose
Number receiving a second dose
Residents
1,788,470
712,646
Staﬀ members
1,251,087
497,276
Total
3,039,557
1,209,922
Source: GAO analysis of information from the Centers for Disease Control and Prevention. | GAO-21-387
CDC does not have complete data on vaccines administered to residents and staﬀ members of
nursing homes outside of the Pharmacy Partnership for Long-Term Care Program, so it does not
have insight into vaccination rates for individual nursing homes that chose not to participate in
the program or for states that opted out of the program.103 For example, while West Virginia—the
only state that opted not to participate in the program—completed its ﬁrst round of nursing home
vaccination clinics before the end of December 2020, administration information for long-term
care facilities was not reported to CDC.104 As a result, these data are not included in CDC tracking
data on nursing home vaccinations.105 According to CDC oﬃcials, data on vaccines administered
to residents and staﬀ members of nursing homes that did not enroll in the federal program can
be voluntarily reported by the facilities through the National Healthcare Safety Network, but it is
unclear how many of those that are reporting are receiving vaccinations outside of the pharmacy
partnership.106
Further, while CDC collects data on the number of vaccinations administered to nursing home
residents and staﬀ through the Pharmacy Partnership for Long-Term Care Program, it does
not publicly report this information for nursing homes speciﬁcally. Instead, CDC reports the
number of vaccination doses, by state, provided to residents and staﬀ of all long-term care
facilities vaccinated through the pharmacy partnership, which includes other types of long-term
care providers.107 According to CDC, it is not reporting nursing home speciﬁc data because of
concerns it would not accurately reﬂect the vaccination rates in nursing homes due to turnover
103Certain individual nursing homes are receiving their vaccinations outside of the Pharmacy Partnership for Long-
Term Care Program. Facilities were not required to participate in the program and could opt to have vaccine supply and
management services coordinated by a pharmacy provider of its choice. According to HHS, 2 percent (374 out of 15,727)
of nursing homes chose not to enroll in the program.
104COVID-19 vaccine administrators are expected to report certain administration data to state information systems,
which are subsequently submitted to CDC. As a result, CDC does report data on vaccines administered in West Virginia
overall, but not for long-term care facilities speciﬁcally.
105According to a state press release, pharmacies in West Virginia administered about 28,000 ﬁrst doses of the vaccine
to residents and staﬀ members in about 210 long-term care facilities.
106According to CDC, as of February 17, 2021, more than 2,200 nursing homes (around 14 percent) are voluntarily
reporting staﬀ vaccination data and over 2,800 nursing homes (around 18 percent) are voluntarily reporting resident
vaccination data.
107In addition to nursing homes, long-term care facilities include assisted living facilities, continuing care retirement
communities, adult family homes, intermediate care facilities for individuals with developmental disabilities, and other
congregate living settings where most individuals receiving care or supervision are older than 65 years of age.
Page 75
GAO-21-387

within facilities. For example, some residents may have received only a second dose through
the pharmacy partnership, as they may have received the ﬁrst dose prior to being admitted
into the nursing home. However, any considerations for interpreting the data could be noted
when presenting the data publicly and does not negate the value of reporting information on the
number of ﬁrst and second doses administered to both staﬀ and residents at the state level for
nursing homes for tracking purposes.
With nursing homes having long been an epicenter of the COVID-19 pandemic, and with CDC’s
Advisory Committee on Immunization Practices recommending that residents be among the
ﬁrst to be vaccinated, detailed information on vaccinations for this population—similar to what
is provided for long term-care facilities overall—is important for tracking and transparency. The
National Strategy for the COVID-19 Response and Pandemic Preparedness notes that agencies should
be sharing data on COVID-19 response and recovery eﬀorts and that these data should be publicly
available to support performance tracking and ensure transparency. Without publicly providing
detailed vaccination data that shows vaccination rates for the diﬀerent long-term care facilities,
including nursing homes, it is unclear how successful eﬀorts have been to vaccinate nursing home
residents and may make it diﬃcult to use these data to improve ongoing and future vaccination
eﬀorts for the nursing home population.
Further, data on COVID-19 vaccinations in nursing homes will also be important for CMS’s ongoing
eﬀorts to monitor nursing home quality. In January 2021, CMS had not speciﬁed whether nursing
homes would be required to oﬀer COVID-19 vaccinations or how these vaccinations would be
incorporated into its requirements or quality measures for nursing homes. CMS also had not
provided a time frame for making these decisions. The agency said that it continues to evaluate
when and whether changes regarding the COVID-19 vaccine need to be incorporated into its
infection control requirements for nursing homes. It also noted that it is collaborating with CDC to
develop quality measures for COVID-19 vaccinations for appropriate staﬀ and patients.
Vaccination data are a key part of CMS’s oversight of nursing home infection prevention and
control practices—practices critical for managing outbreaks such as COVID-19. Since 2005,
CMS has required nursing homes to oﬀer inﬂuenza and pneumococcal vaccinations to nursing
home residents, given the risk of complications, hospitalizations, and death caused by inﬂuenza
and pneumococcal disease, particularly among the elderly.108 These vaccination rates are
publicly reported as part of CMS’s Nursing Home Quality Initiative and provide information on
the potential risk of inﬂuenza and pneumococcal outbreaks in facilities. Furthermore, making
this data transparent through public reporting provides consumers with insight into how well
nursing homes are caring for their residents' physical and clinical needs, and we have previously
reported (October 2014) that timely information on provider quality are characteristics of eﬀective
transparency tools.
COVID-19 has a mortality rate far exceeding that of inﬂuenza and, according to CDC, spreads
more easily than inﬂuenza, making it a signiﬁcant threat to nursing home residents. Like data on
inﬂuenza and pneumococcal vaccination rates, data on COVID-19 vaccination rates could help
manage the risk of COVID-19 outbreaks in nursing homes and serve as an important source of
108See 42 C.F.R. § 483.80(d) (2019).
Page 76
GAO-21-387

information for consumers about quality of care, making the collection of complete vaccination
rate data critical for any quality measures developed.
Staﬃng challenges continue. The percentage of nursing homes experiencing staﬃng shortages
improved slightly from when we reported in January.109 According to data nursing homes self-
reported to CDC, as of February 7, 2021, approximately
• 17 percent of nursing homes had a shortage of aides (a decrease of about 3 percentage
points),
• 16 percent had a shortage of nursing staﬀ (a decrease of about 2 percentage points),
• 9 percent had a shortage of other staﬀ (a decrease of about 2 percentage points), and
• 2 percent had a shortage of clinical staﬀ (a decrease of less than 1 percentage point).110
Nursing home association oﬃcials we interviewed noted that the workforce situation has not
improved since we reported in January. These association oﬃcials said that staﬀ in nursing homes
are exhausted, face burn out from emotional trauma, may be required to quarantine due to
exposure to the virus, or must stay home to take care of family members who become sick, all of
which may further strain resources.111 According to one nursing home association we interviewed,
the employment of temporary nurse aides has been an important tool to avoid larger staﬃng
shortages, reinforcing information we heard and reported on earlier in the pandemic. During the
public health emergency, nursing homes have relied on nurse aides hired or retained under a CMS
ﬂexibility that waived or reduced certain training and certiﬁcation requirements for nurse aides to
allow nursing homes greater ﬂexibility to address staﬃng shortages during the pandemic.112
109Our January report covered data nursing homes self-reported to CDC as of December 6, 2020.
110According to CDC, aides include certiﬁed nursing assistants, nurse aides, medication aides, and medication
technicians; nursing staﬀ include registered nurses, licensed practical nurses, and vocational nurses; clinical
staﬀ include physicians, physician assistants, and advanced practice nurses; and other staﬀ include any staﬀ not
included in the other three categories, such as cooks, pharmacists, and physical therapists.
111A report released in October 2020 by the HHS Assistant Secretary for Policy and Evaluation also found that nursing
home staﬃng shortages and attrition have further strained nursing homes during the pandemic. The report found that
in response to challenging working conditions, and the high risk of COVID-19 infection, some nurses and nurse aides
are leaving the nursing home sector during this critical time when there is an increased demand for their skills and
expertise.
112On March 30, 2020 CMS announced that the agency is waiving the requirements at 42 C.F.R. § 483.35(d) (with the
exception of 42 C.F.R. § 483.35(d)(1)(i)), which require that a skilled nursing facility or nursing facility not employ anyone
working as a nurse aide for longer than four months unless they met the training and certiﬁcation requirements under
section 483.35(d).
Page 77
GAO-21-387

Agency Comments
We provided HHS and the Oﬃce of Management and Budget (OMB) with a draft of this enclosure.
HHS provided general comments, which are reproduced in Appendix VI. In its comments, HHS
neither agreed nor disagreed with our recommendations.
In response to our recommendation to collect and publicly report COVID-19 vaccination data for
nursing homes, HHS said it is working towards better data transparency and noted that nursing
homes have an opportunity to voluntarily report data through the National Healthcare Safety
Network tracking system. However, our focus was on reporting data that is already collected
through the Pharmacy Partnership for Long-Term Care and was provided to us for this report.
Speciﬁcally, HHS should publicly report the ﬁrst and second dose data for residents and staﬀ
of nursing homes—as it does for long-term care facilities on the whole—when the pharmacy
partnership ends in order to provide insight into how successful the pharmacy partnership was in
vaccinating nursing home residents and staﬀ.
In response to our recommendation to require nursing homes to oﬀer COVID-19 vaccinations
to residents and staﬀ and to design and implement associated quality measures, HHS said it
agrees that access to vaccines is essential for nursing home residents. The department indicated
that CMS is “actively evaluating” whether changes need to be made to its infection control
requirements regarding the COVID-19 vaccine and that CMS and CDC “have made progress in
developing quality measures related to COVID-19 vaccination.” We maintain the importance of
these recommendations for providing insight into nursing home quality of care and protecting the
vulnerable nursing home population.
HHS also provided technical comments, which we incorporated as appropriate. OMB did not have
comments on this enclosure.
Methodology
To conduct this work, we reviewed CMS and CDC data, agency guidance, and other relevant
information on HHS’s response to the COVID-19 pandemic. We also reviewed written
responses from CMS and CDC and spoke to CMS and CDC oﬃcials. In addition, we interviewed
representatives from two national nursing home associations and oﬃcials from associations
representing various state and local oﬃcials.
In addition, we analyzed CDC data on COVID-19 reported by nursing homes for the week ending
February 7, 2021.113 We analyzed the CDC data as they were reported by nursing homes to CDC
and publicly posted by CMS.
113We analyzed the most recent data available on February 18, 2021. The CDC data on COVID-19 in nursing homes were
accessed on February 18, 2021, for the week ending February 7, 2021, from https://data.cms.gov/Covid19-nursing-home-
data. For the data on COVID-19 in nursing homes, we analyzed and reported data that had been determined by CDC and
CMS to pass quality assurance checks for data entry errors. According to CDC, data used in this analysis are part of a live
data set, meaning that facilities can make corrections to the data at any time.
Page 78
GAO-21-387

We did not otherwise independently verify the accuracy of the information with these nursing
homes. We assessed the reliability of the data sets used in our analyses by checking for missing
values and obvious errors and reviewing relevant CMS and CDC documents. We determined the
data were suﬃciently reliable for the purposes of our reporting objective.
Contact information: John E. Dicken, (202) 512-7114, dickenj@gao.gov
Related GAO Products
Infection Control Deﬁciencies Were Widespread and Persistent in Nursing Homes Prior to COVID-19
Pandemic. GAO-20-576R. Washington, D.C.: May 20, 2020.
Science & Tech Spotlight: COVID-19 Testing. GAO-20-584SP. Washington, D.C.: May 20, 2020.
Nursing Homes: Better Oversight Needed to Protect Residents from Abuse. GAO-20-259T. Washington,
D.C.: November 14, 2019.
Health Care Transparency: Actions Needed to Improve Cost and Quality Information for Consumers,
GAO-15-11. Washington, D.C.: October 20, 2014.
Page 79
GAO-21-387

Strategic National Stockpile and the Medical Supply Chain
While the Oﬃce of Assistant Secretary for Preparedness and Response has taken some steps
to address immediate supply needs, the COVID-19 pandemic has highlighted long-standing
challenges related to the Strategic National Stockpile’s role and capabilities; these will take time to
address.
Entities involved: The Oﬃce of the Assistant Secretary for Preparedness and Response, within
the Department of Health and Human Services.
Key Considerations and Future GAO Work
Over the course of our CARES Act work, we have reported on eﬀorts to modernize and restructure
the Strategic National Stockpile (SNS) including progress towards building a 90-day supply of
certain key items to respond to future surges in COVID-19 cases, as well as federal and state
eﬀorts to address medical supply gaps. We made recommendations in our September and
January reports.
In September 2020, we recommended that the Department of Health and Human Services (HHS),
in coordination with the Federal Emergency Management Agency (FEMA) within the Department
of Homeland Security, develop and communicate to stakeholders plans outlining speciﬁc federal
government actions that will be taken to help mitigate supply gaps for the remainder of the
COVID-19 pandemic, which could contribute to ensuring a more eﬀective response.114 HHS and
the Department of Homeland Security disagreed with this recommendation.
In January 2021, we reported on HHS’s draft strategy to improve the medical supply chain
to enhance pandemic preparedness by monitoring supply information, increasing domestic
production, and re-thinking supply management.115 We recommended that HHS develop a
process for regularly engaging with Congress and nonfederal stakeholders as the agency reﬁnes
and implements its supply chain strategy, to include the role of the SNS. HHS generally agreed with
this recommendation.
We will continue to monitor federal actions to mitigate supply gaps through federal planning and
SNS modernization eﬀorts, as well as progress toward SNS 90-day inventory goals, in response to
provisions in the Pandemic and All-Hazards Preparedness and Advancing Innovation Act of 2019
and the CARES Act.116
114We also recommended in September 2020 that (1) HHS and FEMA immediately document roles and responsibilities
for supply chain management functions transitioning to HHS, and (2) HHS and FEMA work with relevant stakeholders
to devise interim solutions to help states enhance their ability to track the status of supply requests and plan for supply
needs. HHS and the Department of Homeland Security disagreed with these recommendations.
115Our review was based on a draft of the strategy, which the Oﬃce of the Assistant Secretary for Preparedness and
Response had been in the process of ﬁnalizing, as of January 13, 2021.
116Pandemic and All-Hazards Preparedness and Advancing Innovation Act of 2019, Pub. L. No. 116-22, § 403(a)(5), 133
Stat. 905, 946-47; CARES Act, Pub. L. No. 116-136, § 19010, 134 Stat. 281, 579-81 (2020).
Page 80
GAO-21-387

Background
The SNS, overseen by HHS’s Oﬃce of the Assistant Secretary for Preparedness and Response
(ASPR), is a federal stockpile of vaccines, pharmaceuticals, and medical supplies and devices
designed to be deployed to support the response to a public health emergency.117 At the outset of
the COVID-19 pandemic, the SNS was a critical resource to states for needed and scarce medical
supplies. However, the nationwide need for personal protective equipment (PPE) to protect
responders and to treat Americans sickened with COVID-19 quickly exceeded quantities contained
in the SNS.
On January 31, 2020 the Secretary of Health and Human Services declared a public health
emergency and began to take actions to respond to the pandemic including distributing medical
supplies through the SNS to states, localities, territories, and tribes beginning in March 2020.
The U.S. Government COVID-19 Response Plan (PanCAP Adapted) identiﬁes HHS as the lead federal
agency for the COVID-19 response, with support from FEMA for coordination.118 However, in
March 2020, leadership for the overall response shifted to FEMA, including responsibility for the
acquisition and distribution of supplies in conjunction with HHS.119
As of March 11, 2021, six relief laws had been enacted to assist the COVID-19 response.120 These
laws appropriated funding for HHS activities, and, in some cases, speciﬁcally authorized their use
for the SNS. As of February 28, 2021, HHS reported it obligated about $8.9 billion of the $13.9
billion it planned to use for the SNS to purchase PPE and ventilators for immediate use as well as
to replenish SNS inventory, among other purposes, and had expended about $5.2 billion.
Overview of Key Issues
Pandemic highlighted long-standing challenges related to SNS role and capabilities. The
COVID-19 pandemic has been unprecedented in scale and has stressed the resources and
capabilities of federal, state, and local governments, as well as the private and non-proﬁt sectors.
Over the course of the past year, as part of our CARES Act reports, we have discussed the SNS and
its role in the pandemic response with oﬃcials from federal and state governments, public health
associations, and experts on public health preparedness. From these interviews, a consistent set
117See 42 U.S.C. § 247d-6b.
118See Department of Health and Human Services, U.S. Government COVID-19 Response Plan ( PanCAP Adapted), March
13, 2020.
119Beginning in March 2020, state, tribal, and territorial governments unable to meet local PPE needs through the
purchase of materials from the commercial market or other state-initiated eﬀorts, could make a resource request to
FEMA. According to ASPR and FEMA oﬃcials, responsibility for fulﬁlling the request for PPE ﬁrst falls to FEMA and, if
FEMA cannot provide the PPE, the request is assigned to others, such as to the SNS, to fulﬁll.
120As of March 11, 2021, the six relief laws enacted to assist the response to COVID-19 were the American Rescue Plan
Act of 2021, Pub. L. No. 117-2, 135 Stat. 4; Consolidated Appropriations Act, 2021, Pub. L. No. 116-620, 134 Stat. 1182
(2020); Paycheck Protection Program and Health Care Enhancement Act, Pub. L. No. 116-139, 134 Stat. 620 (2020); CARES
Act, Pub. L. No. 116-136, 134 Stat. 281 (2020); Families First Coronavirus Response Act, Pub. L. No. 116-127, 134 Stat. 178
(2020); the Coronavirus Preparedness and Response Supplemental Appropriations Act, 2020, Pub. L. No. 116-123, 134
Stat. 146.
Page 81
GAO-21-387

of long standing challenges emerged regarding the role, funding, and supply allocation of the SNS
as well as challenges related to federal response coordination.
Determining the appropriate role of the SNS in a pandemic. The near depletion of the SNS early in the
pandemic response raised questions among the state oﬃcials and experts we interviewed about
the role, expectations and transparency of the SNS during a nationwide pandemic. For example,
all eight states we interviewed in July and August 2020 reported that certain supplies they received
from the SNS were not suﬃcient to meet their needs and most added that the SNS should be
more transparent in the future about its contents to set realistic expectations about the availability
of supplies.
ASPR oﬃcials, however, told us that the SNS was not designed to provide states with supplies for
a prolonged nationwide event such as the COVID-19 pandemic; it is primarily designed to respond
to discrete and localized events. The SNS was originally created to provide for the emergency
health security of the United States in the event of a bioterrorist attack or other public health
emergency.121 Over time the SNS has been used to respond to a growing variety of threats
including radiological and nuclear, inﬂuenza and other emerging infectious diseases, and natural
disasters. In its ﬁscal year 2018-2022 budget plan for medical countermeasure development, HHS
noted that building an inventory of supplies to address all types of threats has been a challenge.
Additionally, several of the experts we interviewed noted that a re-examination of the role of the
SNS during a pandemic is needed so that there is clarity about what resources and capabilities
would be made available to state, local, tribal, and territorial governments from the stockpile.
HHS has been discussing the proper role of the SNS for many years. For example, in 2016, HHS
convened a National Academy of Sciences workshop to, among other things, reevaluate the
SNS’s emphasis on potential chemical, biological, radiological, and nuclear attacks on the United
States.122 Participants noted that the role of the SNS was already broad and intended to support
all types of hazardous events. As one participant noted, without better focus the SNS would not be
able to fulﬁll the greatest amount of life saving potential.
Aligning SNS role and funding. Several of the experts we interviewed mentioned that it is important
to ensure that SNS funding is adequate and ﬂexible enough to match its role. The issue of aligning
the SNS’s role with its funding was highlighted during the COVID-19 response as oﬃcials from all
states and most public health associations we interviewed noted that certain types of PPE from
the SNS were not suﬃcient in terms of quantity, and in some cases, quality. For example, one state
and most public health associations reported that some supplies, such as masks, distributed by
the SNS were past their expiration dates and could not be used.
ASPR oﬃcials told us that HHS did not replenish PPE to previous levels following the H1N1
inﬂuenza pandemic of 2009. According to an HHS budget document, in April 2009, at the start of
the H1N1 pandemic, the SNS contained approximately 106 million N95 respirators. In December
121See Pub. L. No. 107-188, § 121, 116 Stat. 594, 611-13 (2002) (codiﬁed, as amended, at 42 U.S.C. § 247d-6b).
122See National Academies of Sciences, Engineering, and Medicine, The Nation’s Medical Countermeasures Stockpile:
Opportunities to Improve the Eﬃciency, Eﬀectiveness, and Sustainability of the CDC Strategic National Stockpile: Workshop
Summary. Washington, D.C.: National Academies Press. 2016.
Page 82
GAO-21-387

2019, prior to the start of the COVID-19 pandemic, the SNS contained 12.6 million N95 respirators,
which were remaining from the H1N1 pandemic. As of January 27, 2021, the federal response has
supplied about 100 million N95 respirators to state, tribal, and territorial governments in response
to COVID-19, according to federal data provided in a senior leadership brief.
ASPR oﬃcials told us that HHS did not replenish PPE to previous levels following the H1N1
inﬂuenza pandemic of 2009 because of a lack of funding. ASPR oﬃcials noted that requested
funding has not always fully reﬂected SNS funding needs. They explained that this is because there
are competing priorities and tradeoﬀs and the budget process involves aligning SNS budgetary
needs with broader HHS needs and the President’s budget priorities.
Funding concerns were also identiﬁed in a 2013 working group report compiled by two HHS
advisory bodies.123 The working group concluded that the SNS was increasingly confronted
with unfunded requirements as its responsibilities expanded and, without action, anticipated a
widening gap between the responsibilities of the SNS and the resources available to fulﬁll them.
Allocating scarce SNS supplies. Some experts and all public health association oﬃcials told us that it
was challenging to understand how the SNS allocated scarce medical supplies. For example, one
expert—a state public health oﬃcial—noted that it was diﬃcult to understand what supplies were
being sent out of the SNS and how they were being allocated, and all states noted that they did not
receive the quantity of supplies requested.
As we reported in our June 2020 CARES Act report, ASPR oﬃcials told us they distributed SNS
supplies to states in March and April 2020 primarily using a pro-rata allocation strategy, which
provided supplies to every state based on population.124 ASPR oﬃcials noted that this approach
was used to distribute materials to states in previous public health emergencies, including the
H1N1 inﬂuenza pandemic of 2009 when the SNS distributed 85 million N95 respirators, among
other supplies. Given the ﬁnite amount of supplies contained in the SNS and the widespread
demand, ASPR oﬃcials told us that this allocation strategy was the most equitable approach.
We also reported that HHS and FEMA oﬃcials believed that states may have requested more
supplies than they needed. ASPR oﬃcials added that many of the processes the SNS and the
states had put into place for supply request and distribution were not applicable to a nationwide
response where the volume of supplies was not adequate. ASPR oﬃcials told us that another
allocation approach—directing supplies to the areas of greatest need—was simply not an
option at the beginning of the COVID-19 response due to the lack of reliable data and modeling
uncertainty needed to target supplies. As such, they determined that pro-rata allocation was a
123See National Biodefense Science Board and the Oﬃce of Public Health Preparedness and Response Board of
Scientiﬁc Counselors, Anticipated Responsibilities of the SNS in the Year 2020: An Examination with Recommendations, April
3, 2013, accessed May 20, 2020, https://www.phe.gov/Preparedness/legal/boards/nbsb/recommendations/Documents/
nbsb-bsc-sns-2020-ﬁnal.pdf.
124ASPR distributed SNS supplies in three separate allocations. In each of the ﬁrst and second allocations, ASPR
distributed 25 percent of available SNS supplies to 62 areas across all 50 states, four large metropolitan areas, and the
eight territories and freely associated states, according to ASPR oﬃcials. In the last substantial distribution of supplies
from the SNS—based on a decision made by the Uniﬁed Coordination Group—ASPR provided most of the remaining
SNS inventory to states, reserving 10 percent for federal health care and other responders.
Page 83
GAO-21-387

reasonable approach for distributing the ﬁnite amount of supplies contained in the SNS at the
start of the pandemic.
While the SNS had never faced a response of this scale or duration prior to the COVID-19
pandemic, ASPR has attempted to understand what supply allocation models might be
appropriate in a large scale event. For example, the 2016 Public Health Emergency Medical
Countermeasure Enterprise (PHEMCE) Strategy and Implementation Plan noted that PHEMCE was
working to identify approaches to address medical countermeasure resource allocation when
stockpile inventory was inadequate to meet the needs of a large-scale public health emergency.125
ASPR oﬃcials were unable to recall or provide further information speciﬁc to this eﬀort, but noted
certain actions taken around determining the allocation of medical countermeasures and vaccines
for an anthrax event. ASPR oﬃcials added that resource allocation approaches have been part of
the planning discussions for inﬂuenza or other emerging infectious diseases for many years.
Clarifying roles and responsibilities among response partners. States, experts, and public health
association oﬃcials noted challenges with requesting supplies when the responsibility shifted
from HHS to FEMA in March 2020. For example, one expert noted that supply request confusion
was compounded by the fact that states had processes to request and receive supplies from the
SNS, but during the response there were additional agencies involved in the process. We identiﬁed
similar issues in our September 2020 CARES Act report and made recommendations about the
need to document roles and responsibilities for supply management functions transitioning
to HHS from other federal partners, such as the Department of Defense, and devising interim
solutions to help states track supply requests and plan for supply needs.
HHS oﬃcials told us that they have had extensive coordination and communication with states
during the response, including holding calls with state governors, delivering trainings, providing
brieﬁngs, and disseminating guidance. HHS oﬃcials noted that improving the pandemic response
capabilities, practices, processes, and capacity of state, local, tribal, and territorial governments is
a priority. ASPR oﬃcials added that there is always some confusion and lack of clarity related to
supplies during an emergency and they are always looking for ways to improve and reﬁne.
After-action reports of actual events and pandemic exercises have also identiﬁed issues with
federal coordination. For example:
• FEMA’s initial assessment report of its COVID-19 response issued in January 2021 noted that
not all response members understood who led the resource allocation mission and how it
ﬁt into the overall response.126 The report noted that diﬀerences between FEMA and HHS
component agencies, including ASPR, created signiﬁcant issues with coordination and service
delivery to state, local, tribal, and territorial partners.
125The PHEMCE—a federal interagency body led by ASPR—has made recommendations regarding research,
development, procurement, stockpiling, deployment, distribution and utilization with respect to medical
countermeasures. Medical countermeasures are drugs, biologics, and devices, such as personal protective equipment,
used to diagnose, treat, prevent, or mitigate harm from any chemical, biological, radiological, and nuclear agent.
126Department of Homeland Security, Federal Emergency Management Agency, Pandemic Response to
Coronavirus Disease 2019 (COVID-19): Initial Assessment Report (January 2021).
Page 84
GAO-21-387

• The after-action report of a large-scale avian inﬂuenza pandemic exercise conducted in August
2019 (“Crimson Contagion”) noted confusion among exercise participants around the process
for requesting supplies from multiple federal entities.127 For example, the after-action report
noted that the resource request process was not transparent to the range of state, local, tribal,
territorial, and federal response partners.
• Finally, coordination issues among multiple federal response partners were also noted in the
Centers for Disease Control and Prevention’s after-action report for the 2014 Ebola response.
That report noted that agencies and organizations were often unaware of the mission and
responsibilities of other response partners and a deeper understanding of capabilities, roles,
and responsibilities will likely be needed in the future.
Both the FEMA COVID-19 assessment and Crimson Contagion after-action report made
recommendations about conducting training and exercises focused on how federal agencies
coordinate and communicate with state, local, tribal and territorial partners. ASPR oﬃcials noted
in February 2021 that they have not yet had a chance to address the recommendations in the
Crimson Contagion after action report due to the pandemic response. ASPR oﬃcials told us that
they are collecting data to inform their COVID-19 after-action report as the response is ongoing
and will analyze the data and prepare the report after the response has ended.
ASPR has taken steps to help address immediate COVID-19 supply needs. In the short term,
ASPR, in conjunction with its federal partners, determined a key action would be to stockpile
a 90-day supply of certain PPE, which could help address the scarcity of these supplies for the
immediate pandemic and could help address allocation issues by having adequate supply.
According to HHS oﬃcials, this eﬀort was funded with COVID-19 relief funds, such as those made
available through the CARES Act.
According to ASPR oﬃcials they were aiming to meet their 90-day targets of PPE by the end
of 2020; however, as we previously reported, ASPR has to balance replenishing the stockpile
with ensuring adequate commercial availability. As such, ASPR oﬃcials reported that they have
delayed delivery of some contracted items to the SNS to enable manufacturers to make them
available in the commercial market to alleviate supply constraints. For example, ASPR contract
information shows that the SNS deferred delivery of 10.1 million N95 respirators from October
2020 to April 2022. Additionally, HHS also reported distributing supplies from the stockpile to
address immediate supply needs. Both of these activities may continue to aﬀect progress towards
90-day targets; although ASPR oﬃcials noted in February 2021 that they were not planning any
additional deferrals.
According to ASPR data, as of February 2021, the SNS has reached, or almost reached, its
90-day targets for N95 respirators, surgical or procedural masks, and eye protection or face
shields. However, supplies of gloves and gowns or coveralls remain far from their 90-day targets.
According to ASPR oﬃcials, ensuring adequate supplies of nitrile gloves continues to be a problem
due to the issues with the global supply chain. See table below for more on the SNS inventory of
127Department of Health and Human Services, Oﬃce of the Assistant Secretary for Preparedness and Response,
Crimson Contagion 2019 Functional Exercise After-Action Report (January 2020). Crimson Contagion consisted of
multiple meetings in 2019, which culminated in a four-day functional exercise held in August 2019.
Page 85
GAO-21-387

PPE. (For more information on medical supply availability and eﬀorts to expand domestic medical
product manufacturing, please see our enclosures on Hospital and Pharmacy Perspectives on
COVID-19 Vaccine Administration and Medical Supply Availability and Domestic Medical Product
Manufacturing.
Page 86
GAO-21-387

Strategic National Stockpile Personal Protective Equipment Inventory
Personal protective equipment
Feb. 26, 2021 inventory on hand
Planned 90-day Inventory
Gloves – surgical/exam
227 milliona
4.5 billion
N95 respirators
307 million
300 million
Surgical or procedural Masks
411 million
400 million
Gowns or coveralls
65.8 million
265 million
Eye protection or face shields
17.6 million
18 million
Source: Data from the Oﬃce of the Assistant Secretary for Preparedness and Response (ASPR) within the Department of Health and Human Services. | GAO-21-387
Note: The SNS continues to deploy supplies in response to requests and these deployments may aﬀect the ability to reach the
SNS inventory targets and could also result in some ﬂuctuation in inventory quantities over time, according to ASPR oﬃcials.
aAccording to ASPR oﬃcials, the SNS contains a mix of glove types in its inventory including latex, vinyl, nitrile, and a blend of
vinyl and nitrile. Of these types, the vinyl-nitrile blend makes up most of the glove inventory.
Stockpiling for the near term could help address challenges the SNS had with the quality and
quantity of supplies they were able to provide at the beginning of the COVID-19 response and
allow for more targeted allocation strategies. However, ASPR oﬃcials were uncertain whether
they would maintain these target supply levels beyond the COVID-19 response. Additionally, ASPR
oﬃcials noted that they have limited ability to rotate expiring PPE stock but have requested the
use of COVID-19 relief funds to replace depleted or expiring PPE.
ASPR has also taken steps to improve eﬃciency in the distribution of certain pandemic supplies
through a vendor managed inventory approach. Under this approach, ASPR has contracted with
vendors to hold and distribute products that the SNS has purchased in response to the COVID-19
pandemic. ASPR oﬃcials told us that this model has advantages in a pandemic since it utilizes
multiple distribution centers that are geographically diverse and can deliver directly to points of
care.
Plans to address longer-term challenges facing SNS will take time to address. Eﬀorts to
address longer-term challenges that we and others have identiﬁed—such as the role of the SNS in
future pandemics, budget planning for that role, and sustainment of current PPE inventory—will
take longer to address. ASPR oﬃcials told us these issues are tied to developing a broader
supply chain capability that includes the ability to monitor the commercial supply chain for
disruptions to it and supporting domestic manufacturing capabilities for PPE and other medical
countermeasures. To that end, HHS developed a national supply chain strategy that outlines
the capabilities that they must acquire—including, but not limited to, the SNS—to address the
challenges identiﬁed by the pandemic.128 The draft strategy discusses many of the longer-term
challenges we raise above.
128 According to ASPR oﬃcials, the strategy—entitled “SNS 2.0 Strategy – Modernize the SNS”—was approved by the
previous Assistant Secretary for Preparedness and Response in mid-January 2021, but has not been released publically.
For more information on this strategy, please see our January 2021 CARES Act report.
Page 87
GAO-21-387

However, the federal government is in a period of transition when it comes to developing and
implementing a longer-term supply chain strategy to address both the speciﬁc SNS challenges we
and others identiﬁed and broader supply chain issues. ASPR oﬃcials told us in late January 2021
that their draft supply chain strategy was on hold as the agency examines how it aligns with the
new administration’s priorities.
As we reported in January 2021, reexamining the role of the SNS in the U.S. response to pandemics
will require diﬃcult policy decisions and tradeoﬀs about systems, budgets, and authorities.
Further, the COVID-19 pandemic has shown how complex and diﬃcult a coordinated response
across numerous federal and state, local, tribal, and territorial entities can be. Our prior work
(see Related Product section for our 2004 work on national strategies, for example) and that of
others has shown that implementing signiﬁcant organizational change requires a comprehensive,
integrated strategic plan with desirable characteristics that provide additional guidance to
responsible parties for developing and implementing national strategies. Such a plan can set a
clear direction for transformation eﬀorts, help decision makers more eﬀectively guide and assess
progress, and do so in a clear and transparent manner. Additionally, such planning can provide
the government with a sound basis for making investment decisions and help assure that it is
developing and maintaining the optimal set of capabilities to achieve its transformational goals.
ASPR oﬃcials stated that they remain committed to following stated guidance and best practices
regarding strategic planning and implementation, consistent with previous ASPR eﬀorts.
In January 2021, the President signed an Executive Order calling for the development of a
pandemic supply chain resilience strategy to design, build, and sustain a long-term capability to
manufacture medical supplies for future pandemics and biological threats.129 Per the order, this
strategy is to include the role of the SNS in (1) providing and allocating supplies across state, local,
tribal and territorial governments, (2) sustaining supplies during a pandemic, and (3) contingency
planning, among other things, within 180 days. Implementing the recommendation we made
in January 2021 to develop a process for regularly engaging with Congress and nonfederal
stakeholders in the development and implementation of a medical supply chain strategy to
enhance pandemic response capabilities—to include the role of the SNS—would help guide this
complex transformation.
To address more immediate supply needs, the President has also called for action that
is consistent with our September 2020 recommendation that HHS—in coordination with
FEMA—develop and communicate to stakeholders plans outlining speciﬁc federal government
actions that will be taken to help mitigate supply gaps. Speciﬁcally, the Executive Order also
directed the Secretaries of State, Defense, Health and Human Services, and Homeland Security
among other federal agencies to immediately review the availability of pandemic response
supplies, including PPE, and take appropriate action to ﬁll any identiﬁed shortfalls in consultation
with state, local, tribal, and territorial governments and other critical entities, as appropriate.
Additionally, the Consolidated Appropriations Act, 2021—enacted in December of 2020—included
a provision requiring the President to make publicly available a report containing a whole-of-
government plan for eﬀective response to subsequent COVID-19 outbreaks and for future global
129Exec. Order No.14,001, 86 Fed. Reg. 7,219 (Jan. 26, 2021).
Page 88
GAO-21-387

pandemic diseases.130 The act stipulates that this pandemic plan should address how to improve
the role of the federal government with respect to the regulation, acquisition, and disbursement of
medical supplies necessary to respond to COVID-19 as well as the procurement and distribution of
PPE, among other things.
We will continue to monitor eﬀorts to develop plans and strategies to address challenges raised
by the COVID-19 pandemic regarding the SNS’s capabilities and other eﬀorts to create resiliency in
the medical supply chain, as part of our future CARES Act and SNS work.
Agency Comments
We provided HHS and the Oﬃce of Management and Budget (OMB) with a draft of this enclosure.
HHS provided technical comments, which we incorporated as appropriate. OMB did not provide
comments on this enclosure.
Methodology
To understand and categorize SNS COVID-19 challenges, we reviewed interviews we conducted
and documents we received over the course of our CARES Act reporting. This included (1)
interviews, written responses, and documentation from ASPR, FEMA, the Department of Defense
and other interagency groups about actions related to increasing supply, making distribution
decisions, and modernizing the SNS; (2) interviews with eight states (in July and August 2020) that
were selected based on a variety of criteria including a range of COVID-19 case counts per capita,
regional diversity, and participation in Crimson Contagion, among other things; (3) interviews
with 9 individuals (in September, October, November, and December 2020) with expertise on the
operations or activities of the SNS, and an understanding of public health funding, preparedness,
and COVID-19 response actions (referred to as “experts” in this enclosure); and (4) interviews with
public health, private industry, laboratory and health care associations throughout the course of
our work. To understand ASPR eﬀorts to address challenges, as well as current eﬀorts to develop
COVID-19 supply chain strategies, we held interviews with ASPR oﬃcials in the current and former
administrations and reviewed executive orders related to pandemic response. Finally, to assess
the reliability of the SNS inventory data reported in this enclosure, we discussed inventory controls
with agency oﬃcials and conducted comparisons to other sources to check for consistency. We
determined the data were suﬃciently reliable for the purposes of our reporting objectives.
Contact information: Mary Denigan-Macauley, (202) 512-7114, deniganmacauleym@gao.gov
Related Product
Combating Terrorism: Evaluation of Selected Characteristics in National Strategies Related to Terrorism.
GAO-04-408T. Washington, D.C.: February 3, 2004.
130Consolidated Appropriations Act, 2021, Pub. L. No. 116-620, div. W, § 621(b), 134 Stat. at 2403-04.
Page 89
GAO-21-387

Funding for COVID-19 Testing
Selected jurisdictions told us that federal funding for testing has been generally suﬃcient for the
short term, but concerns about longer-term sustainability remain.
Entities involved: Centers for Disease Control and Prevention, within the Department of Health
and Human Services, and the Department of the Treasury
Key Considerations and Future GAO Work
We recently and repeatedly reported on concerns with the federal response to COVID-19 testing.
For example:
• In September 2020, we reported on challenges with testing supply availability, and
recommended that HHS develop plans outlining speciﬁc actions the federal government
could take to help mitigate remaining medical supply gaps—including testing supply
shortages. As of January 2021, HHS disagreed with our recommendation, noting, among other
things, the work that the department had done to manage the medical supply chain and
increase supply availability. We acknowledge those eﬀorts, but continue to maintain that our
recommendations are warranted. For more information on the availability of testing supplies,
see the Hospital and Pharmacy Perspectives on Administering Vaccines and Medical Supply
Availability enclosure.
• In November 2020, we reported on issues with the transparency of Centers for Disease
Control and Prevention (CDC) testing guidelines and recommended that the Department
of Health and Human Services (HHS) ensure that the scientiﬁc rationale for any changes is
included when such changes are made. HHS concurred with our recommendation and has
begun to implement it. For example, on February 16, 2021, CDC issued Interim Guidance
on Testing Healthcare Personnel and provided links to studies that explained the scientiﬁc
rationale for the changes in guidance. We will continue to monitor implementation of this
recommendation to ensure that these eﬀorts continue.
In January 2021, we reported on the HHS COVID-19 testing strategy at that time and
recommended that HHS produce and make publicly available a consolidated and comprehensive
national strategy document that incorporated all six characteristics of an eﬀective national
strategy.131 The new administration issued its National Strategy for the COVID-19 Response
and Pandemic Preparedness (National Strategy) on January 21, 2021 that includes increasing
testing capacity among its seven goals.132 To meet this goal, the National Strategy describes
several actions, including the issuance of an Executive Order establishing the COVID-19 Pandemic
Testing Board (Testing Board). The Testing Board is tasked with implementation of a clear, uniﬁed
approach to testing and coordinating federal government eﬀorts to promote COVID-19 testing,
131The six characteristics of an eﬀective national strategy are: (1) clear purpose, scope, and methodology; (2) problem
deﬁnition and risk assessment; (3) goals, subordinate objectives, activities, and performance measures; (4) resources,
investments, and risk management; (5) organizational roles, responsibilities, and coordination; and (6) integration and
implementation. Each characteristic has several sub-elements.
132See White House, National Strategy for the COVID-19 Response and Pandemic Preparedness, January 21, 2021.
Page 90
GAO-21-387

among other things. We will continue to monitor Testing Board eﬀorts and the development of
any comprehensive plans to implement testing goals outlined in the National Strategy.
The Paycheck Protection Program and Health Care Enhancement Act requires HHS to submit
Testing Strategy reports to Congress every 90 days until funds provided under the act are
expended.133 As of March 16, 2021, HHS had not submitted the report due in February to
Congress or released it to the public. HHS oﬃcials told us that they do not have plans to make
the report public and will defer to Congress on whether they will share the report broadly. Until a
comprehensive national testing strategy is publicly available, HHS is at risk of key stakeholders and
the public lacking crucial information to support an informed and coordinated testing response.
Since we last reported in January, oﬃcials from eight states and one territory (hereafter referred to
as jurisdictions) we interviewed in January 2021 reported that federal funding available for testing
has been generally suﬃcient for the short run. While about 7 percent of the $30 billion in CDC
funding awarded to states, localities, and territories for testing has been expended as of February
28, 2021, oﬃcials told us they prioritized spending down general use funds with a shorter period
of availability before using money that is more speciﬁcally targeted for testing, provided through
CDC, and available for longer periods. At the same time, these selected jurisdictions shared
concerns about maintaining testing capacity and preparedness in the longer term. While recent
funding appropriated after we interviewed jurisdictions will likely bolster response eﬀorts for
COVID-19 testing, it is too soon to know whether this new funding will meet longer term needs. We
will continue to monitor the use of federal funding for testing.
Background
Diagnostic testing for COVID-19 is critical to controlling and understanding the spread of the virus,
according to the CDC. As the coordinating agency for the federal response to public health and
medical emergencies, HHS leads the development and implementation of the national COVID-19
testing strategy. Under the testing strategy from the previous administration, states managed their
own COVID-19 testing programs with federal support.
According to the new administration’s National Strategy, issued on January 21, 2021, the federal
government will partner with jurisdictional leaders to implement a cohesive response strategy
that will include the goal of mitigating the spread of COVID-19 by expanding testing, among other
things.134 To meet this goal, the National Strategy describes several actions, including the issuance
of an Executive Order establishing the Testing Board and directing agencies to facilitate testing
free of charge for those who do not have insurance coverage.
133Pub. L. No. 116-139, div. B, tit. I, 134 Stat. at 626-27 (2020). For previous Testing Strategy reports, see Department
of Health and Human Services, Report to Congress: COVID-19 Strategic Testing Plan (May 24, 2020); Department of Health
and Human Services, Report to Congress: COVID-19 Strategic Testing Plan (August 22, 2020); and Department of Health and
Human Services, Report to Congress: COVID-19 Strategic Testing Plan (November 20, 2020).
134See White House, National Strategy for the COVID-19 Response and Pandemic Preparedness, January 21, 2021.
Page 91
GAO-21-387

Additionally, the Consolidated Appropriations Act, 2021, requires the President to make publicly
available a report containing a whole-of-government plan for an eﬀective response to subsequent
major outbreaks of COVID-19 by late March 2021.135
Overall, HHS reported total obligations of about $42.9 billion as of February 28, 2021 with
expenditures of about $8.5 billion, for testing-related activities.136 About $35.5 billion of this
funding was obligated for awards to states, localities, territories and tribal organizations, but
funding was also obligated and expended by HHS agencies for testing-related activities, such as
procurement of testing supplies and funding for testing for the uninsured.137
For certain funds appropriated speciﬁcally to be made available to states, localities, and territories
for testing and related purposes, HHS awarded funding through the CDC’s longstanding
Epidemiology and Laboratory Capacity for Prevention and Control of Emerging Infectious
Diseases (ELC) Cooperative Agreement. The ELC program is intended to enhance the capacity of
state public health departments to cohesively and comprehensively address infectious disease
needs.138 According to CDC guidance, allowable costs for COVID-19 testing funding through the
ELC program include personnel, laboratory equipment and necessary maintenance contracts,
collection supplies, courier service contracts, and hardware and software necessary for robust
implementation of electronic laboratory and surveillance data, among others. As a condition of
funding, ELC recipients were required, within 30 or 60 days of receiving an award, to submit a work
plan and budget describing proposed activities.139
135Consolidated Appropriations Act, 2021, Pub. L. No. 116-260, div. W, tit. VI, § 621(b)(1), 134 Stat. 1182, 2403 (2020).
136In March 2020, Congress passed, and the President signed into law, the CARES Act, which provided over $2 trillion
in emergency assistance and health care response for individuals, families, and businesses aﬀected by COVID-19. Pub.
L. No. 116-136, 134 Stat. 281 (2020). As of January 1, 2021, four other laws had been enacted that provide relief in
response to the COVID-19 pandemic: Consolidated Appropriations Act, 2021, Pub. L. No. 116-260, 134 Stat. 1182 (2020);
Paycheck Protection Program and Health Care Enhancement Act, Pub. L. No. 116-139, 134 Stat. 620 (2020); Families
First Coronavirus Response Act, Pub. L. No. 116-127, 134 Stat. 178 (2020); and Coronavirus Preparedness and Response
Supplemental Appropriations Act, 2020, Pub. L. No. 116-123, 134 Stat. 146.
137Speciﬁcally, as of February 28, 2021, HHS reported having obligated $5.4 billion (and having expended $3.1 billion)
for general testing activities and having obligated $2.0 billion (and having expended roughly $2.0 billion) in funding for
testing for the uninsured. Not included in the total obligated and expended amount for testing is funding for diagnostics
research and development, of which $1.57 billion has been obligated (and $474 million has been expended), according
to HHS.
138In addition to support for epidemiology, laboratory, and health information systems, ELC funding also supports
disease-speciﬁc program areas. Established in 1995, the ELC program provides more than $200 million each year to
64 recipients, including all 50 states, six localities, and U.S. territories and aﬃliates. ELC-supported activities in each
jurisdiction are overseen by an ELC Governance Team, with representation from epidemiology, laboratory, and health
information systems. According to CDC, this structure has been successfully utilized by ELC recipients to manage
activities and funding from special appropriations provided in response to a number of infectious disease emergencies,
such as H1N1, Ebola, and Zika.
139To receive ELC funding made available under the CARES Act, ELC recipients were required, within 30 days of receiving
a notice of award, to submit a work plan and budget describing proposed activities. To receive ELC funding made
available under the Consolidated Appropriations Act, 2021, ELC recipients were required, within 60 days of receiving
a notice of award, to submit and work plan and budget describing proposed activities. For more information on the
ELC program and other funds for infectious disease preparedness, see GAO, Infectious Disease Threats: Funding and
Performance of Key Preparedness and Capacity-Building Programs, GAO-18-362 (Washington, D.C.: May 24, 2018).
Page 92
GAO-21-387

In addition to the testing-speciﬁc funds distributed through the ELC, jurisdictions received other
funding to support response activities. For example, the CARES Act appropriated $150 billion
to the Coronavirus Relief Fund (CRF) for payments to states, localities, territories, and tribal
organizations for necessary expenses incurred due to the COVID-19 public health emergency.
Jurisdictions could use these funds to further support testing. In addition, the American Rescue
Plan of 2021, enacted on March 11, 2021 appropriated $47.8 billion to HHS to carry out activities
to detect, diagnose, trace, and monitor SARS-CoV-2 and COVID-19 infections and mitigate the
spread of COVID-19.140 These activities include implementation of a national testing strategy,
manufacturing and procurement of tests, and assistance to state, local, and territorial health
departments. The appropriation is available until expended.
Overview of Key Issues
Selected jurisdictions told us that funding for testing was generally suﬃcient for the short
term. Oﬃcials from all nine selected jurisdictions told us in January 2021 that they had suﬃcient
funding for testing in the immediate future. Some oﬃcials told us this was in part due to the
availability of an additional $19.11 billion in ELC funding from the Consolidated Appropriations
Act, 2021 enacted in late 2020. These oﬃcials told us that federal funding allowed them to meet
their immediate testing needs by increasing laboratory capacity and public health infrastructure.
For example, these oﬃcials said they used ELC funds to support testing through various activities
including
• funding local health departments,
• contracting with laboratories for testing services,
• purchasing testing equipment and supplies,
• purchasing information technology to manage testing data, and
• hiring additional staﬀ, such as laboratory technicians and case investigators.
HHS reported that $35.5 billion of COVID-19 relief funding had been made available for testing
activities by jurisdictions—of which about $30 billion had been obligated through ELC awards—as
of February 28, 2021. (See table below.)
140American Rescue Plan Act of 2021, Pub. L. No. 117-2, tit. II, § 2401, 135 Stat. 4, 40.
Page 93
GAO-21-387

Obligations and Expenditures of Federal Funding for Testing-Related COVID-19 Response Activities Provided to
States, Localities, and Territories through the Epidemiology and Laboratory Capacity for Prevention and Control
of Emerging Infectious Diseases (ELC) program, as of February 28, 2021
Key activity
Obligations
($ billions)
Expenditures
($ billions)
Percentage of obligated amounts
expended, as of February 28, 2021
CARES Act ELC funding (March 27,
2020)
0.6
0.1
16.67
Paycheck Protection Program and
Health Care Enhancement Act ELC
funding (April 24, 2020)
10.3
1.9
18.45
Consolidated Appropriations Act,
2021 ELC funding (December 27,
2020)
19.1
-
0.00
Total support to state, local, and
territorial preparedness through
ELC
30.0
2.0
6.67
Source: GAO analysis of information provided by the Department of Health and Human Services. | GAO-21-387
Note: These amounts do not include funds appropriated and obligated for tribal organizations as those funds are not awarded
through the ELC program. For example, the Indian Health Service (IHS) will provide $750 million in funds appropriated by the
Paycheck Protection Program and Health Care Enhancement Act to IHS, tribal, and urban Indian Health programs to expand
testing capacity and testing-related activities. In addition, these laws may have appropriated additional amounts that were
available, but not required to be used, for testing-related COVID-19 response activities for states, localities, and territories. This
table reﬂects only those amounts with availability limited to this purpose.
While it appears as though a relatively small percentage (about 7 percent) of the $30 billion in
federal testing funding obligated for jurisdictions has been expended, we found this is due, in
part, to funding availability time frames. First, much of the $30 billion was awarded relatively
recently in January, 2021. Second, oﬃcials from six of nine selected jurisdictions, as well as three
of four selected state and local public health stakeholder groups we interviewed, told us they or
their members prioritized spending federal funds whose availability ended earliest. For example,
some of these jurisdiction oﬃcials told us they began using ELC funds, which CDC made available
until late 2022, to support testing largely after exhausting payments from the Coronavirus Relief
Fund, which originally covered costs incurred only through the end of 2020.141 (See ﬁgure below).
Additionally, oﬃcials told us they have used ELC funds to hire staﬀ and contract with laboratories,
and that these jurisdiction-level obligations will be paid out over the full life of the ELC award.
141The Consolidated Appropriations Act, 2021, extended this period until the end of 2021. Pub. L. No. 116-260, div. N, tit.
X, § 1001, 134 Stat. at 2403 (2020).
Page 94
GAO-21-387

Timeline of Selected Federal Funding Availability to States, Localities, Territories, and Tribal Organizations Used
to Support Coronavirus Testing
Note: The CARES Act allows recipients to use CRF funds for eligible costs incurred beginning on March 1, 2020. ELC recipients
may have applied awards to costs incurred up to 90 days prior to receiving awards and some reimbursed costs may have
predated enactment of applicable appropriations. See 45 C.F.R. § 308(d)(1) (2019).
aELC awards are funds awarded through the Centers for Disease Control and Prevention’s (CDC) Epidemiology and Laboratory
Capacity for Prevention and Control of Emerging Infectious Diseases (ELC) Cooperative Agreement.
More than half of selected jurisdictions told us they had concerns about maintaining
testing capacity and preparedness in the longer term. Our prior work on ELC and other HHS
programs that provide funding to jurisdictions for preparedness activities has found that funding
to jurisdictions had generally decreased over time before the pandemic.142 Such decreases have
limited state and local preparedness capacity—such as being able to maintain preparedness
staﬀ—and have increased the importance of supplemental appropriations to respond to
infectious disease threats.143
While the supplemental funding has helped jurisdictions address needs to respond to the
pandemic in the short term, most jurisdictions interviewed for this report had concerns about
future testing and related preparedness. Oﬃcials from ﬁve of nine jurisdictions told us they were
concerned about their ability to maintain current testing eﬀorts over the long run. For example:
142Furthermore, a public health stakeholder group has also identiﬁed preparedness concerns. For example,
the National Association of County and City Health Oﬃcials published results from a 2019 survey of local health
departments, indicating decreased workforce capacity, budget shortfalls, and decreased service provision before
the pandemic. See National Association of County and City Health Oﬃcials, 2019 National Proﬁle of Local Health
Departments (Washington, D.C.: 2020), accessed February 11, 2021 from https://www.naccho.org/uploads/
downloadable-resources/Programs/Public-Health-Infrastructure/NACCHO_2019_Proﬁle_ﬁnal.pdf.
143See our May 2018 work on Infectious Disease Threats. (See Related Products.) For this report, we reviewed ELC, CDC’s
Hospital Preparedness Program, and the Assistant Secretary for Preparedness and Responses’ Public Health Emergency
Preparedness cooperative agreement—HHS’s three key preparedness and capacity-building programs. While ELC is
speciﬁc to infectious disease preparedness, the other two support “all-hazard” preparedness capacity, meaning they
help build capacities to respond to a range of public health threats, including infectious diseases, natural disasters, or
terrorist events. Our review found that combined awards from the three programs to jurisdictions decreased from about
$1.4 billion in 2003 to about $1 billion in 2017; though awards through ELC—the smallest of the programs—increased
from about $0.1 billion to $0.2 billion.
Page 95
GAO-21-387

• Oﬃcials from one jurisdiction told us they did not have a suﬃcient public health workforce
to support widespread virus testing prior to the pandemic. These oﬃcials told us they are
concerned that without ongoing supplemental federal funds they will be unable to keep
the trained epidemic and laboratory workforce they developed using federal funds for
Coronavirus response.
• Oﬃcials from another jurisdiction told us its public health funding had declined by almost
50 percent over the last decade. These oﬃcials told us that, as a result, their jurisdiction had
reduced its epidemiology staﬀ and their oﬃce was only able to employ one epidemiologist on
a part-time basis prior to the pandemic, leaving the jurisdiction with no capacity to respond
to new infectious diseases. While oﬃcials said the temporary funding available from the
COVID-19 relief laws helped them respond to COVID-19, they added that when the next
pandemic occurs, they will face the same challenges building a workforce to support testing if
additional funds for public heath are not provided beforehand.
New funding available for testing appropriated by the American Rescue Plan Act of 2021 may help
ameliorate concerns about the suﬃciency of funding for COVID-19 testing in the longer term.
Speciﬁcally, $47.8 billion—to remain available until expended—was appropriated to HHS to carry
out activities to detect, diagnose, and monitor COVID-19 infections and to mitigate the spread of
COVID-19, including through support to states, localities, and territories.144 While this will likely
bolster response eﬀorts for COVID-19 testing, it is too soon to know whether this new funding will
meet longer term needs. We will continue to monitor the use of federal funding for testing.
Agency Comments
A copy of this enclosure was sent to the Department of Health and Human Services and the
Oﬃce of Management and Budget. CDC provided technical comments, which we incorporated as
appropriate. The Oﬃce of Management and Budget did not provide comments on this enclosure.
Methodology
To conduct this work, we examined federal law and agency guidance related to federal funding
for COVID-19 testing. We also obtained HHS data on obligations and expenditures for COVID-19
testing as of February 28, 2021, as well as written responses to questions from relevant agency
oﬃcials. To assess the reliability of the data reported by HHS, we reviewed HHS documentation,
obligation data published by CDC, and information from the federal spending database,
USAspending.gov, as well as from HHS’s spending database, taggs.hhs.gov, and we determined
that the HHS reported data were suﬃciently reliable for the purposes of our reporting objective.
144American Rescue Plan Act of 2021, Pub. L. No. 117-2, tit. II, § 2401, 135 Stat. at 40. On March 17, 2021, HHS
announced the availability of $10 billion in funds provided under the new law to states and territories to support
COVID-19 testing for the reopening of schools.
Page 96
GAO-21-387

Furthermore, we selected a nongeneralizable sample of nine jurisdictions (eight states and one
territory) and interviewed oﬃcials from those departments of health to obtain information on
their experiences using federal funding for COVID-19 testing. We selected these jurisdictions to
achieve variation in geographic region, testing volume, and case counts, among other things. In
doing so, we spoke with oﬃcials from Arizona, Louisiana, Michigan, Pennsylvania, Puerto Rico,
South Dakota, Texas, Vermont, and Washington.
Additionally, we obtained perspectives from a set of four stakeholder groups representing state
and local public health oﬃcials, including groups that represent over 100,000 state and local public
health oﬃcials and epidemiologists, as well as other individuals knowledgeable about funding for
COVID-19 testing.
Contact information: Mary Denigan-Macauley, (202) 512-7114, deniganmacauleym@gao.gov
Related GAO Products
Infectious Disease Threats: Funding and Performance of Key Preparedness and Capacity-Building
Programs. GAO-18-362. Washington, D.C.: May 24, 2018.
Combating Terrorism: Evaluation of Selected Characteristics in National Strategies Related to Terrorism.
GAO-04-408T. Washington, D.C.: February 3, 2004.
Page 97
GAO-21-387

Medicaid Enrollment, Spending, and Flexibilities
While waivers and other ﬂexibilities, as well as increased federal Medicaid funding, have helped
states respond to the public health emergency, they are not permanent. States will face challenges
in resuming normal Medicaid activities, including backlogs for redetermining beneﬁciary eligibility
for Medicaid coverage.
Entity involved: Centers for Medicare & Medicaid Services, within the Department of Health and
Human Services
Key Considerations and Future GAO Work
Since the beginning of the public health emergency, states have implemented various ﬂexibilities
and put certain eligibility renewals and redeterminations on hold in their Medicaid programs.
States have also received additional federal funds to manage the increased number of individuals
enrolled in Medicaid. These funds are set to be reduced to pre-public health emergency levels at
the end of the quarter in which the public health emergency ends.
While the public health emergency is in eﬀect at least through April 20, 2021, and according to
the Acting Secretary of Health and Human Services, it will likely continue at least through the end
of 2021, the Centers for Medicare & Medicaid Services (CMS) began issuing guidance and tools
to states in December 2020 on resuming normal activities once the public health emergency has
ended, including redetermining beneﬁciaries’ eligibility for Medicaid enrollment. The agency also
plans to issue guidance on resuming Medicaid program integrity activities.
Medicaid oﬃcials we interviewed from eight selected states expressed concerns about various
aspects of resuming operations post-public health emergency.145 For example, most states
expressed concerns about resuming normal activities at the same time additional federal funding
is ending. State Medicaid oﬃcials’ concerns included resolving eligibility redetermination backlogs
and enrolling beneﬁciaries ineligible for Medicaid coverage into new health insurance coverage.
We will continue to monitor CMS guidance and states’ responses to the end of public health
emergency going forward.
Background
Medicaid is one of the nation’s largest sources of funding for health care services for low-income
and medically needy individuals, covering an estimated 77 million people and spending an
estimated $673 billion in total federal and state spending in ﬁscal year 2020.146 The federal
145We interviewed state Medicaid oﬃcials in Georgia, Iowa, Louisiana, New Hampshire, New Jersey, New Mexico, Ohio,
and Washington.
146Department of Health and Human Services, Centers for Medicare and Medicaid Services, 2018 Actuarial Report on the
Financial Outlook on Medicaid (Baltimore, Md.).
Page 98
GAO-21-387

government matches states’ spending for Medicaid services according to a statutory formula
known as the Federal Medical Assistance Percentage (FMAP).147
The Families First Coronavirus Response Act (FFCRA) provided a temporary increase in the FMAP
for all qualifying states and territories through the end of the quarter in which the public health
emergency, including any extensions, ends.148 To receive the increased FMAP, states and territories
were required to meet certain conditions, such as maintaining Medicaid enrollment for certain
beneﬁciaries through the end of the month in which the public health emergency ends. FFCRA
also created an option for states to provide Medicaid coverage of COVID-19 diagnostic testing and
related services to uninsured individuals.149
States and territories administer their Medicaid programs within broad federal rules and according
to state plans approved by CMS, the agency within the Department of Health and Human Services
which oversees Medicaid at the federal level. In addition to its normal authority to approve state
waiver applications, CMS has additional authorities in certain emergency circumstances to waive
Medicaid requirements to help ensure the availability of care. The temporary authorities CMS has
approved will terminate based on the conclusion of the public health emergency unless the states
make certain temporary changes permanent, for example, by submitting a state plan amendment
for CMS’s review and approval.
Overview of Key Issues
Medicaid enrollment. In the months since the beginning of the public health emergency, the
number of people covered under Medicaid increased, due in part to increased applications for
Medicaid coverage and requirements under FFCRA for states to maintain Medicaid enrollment
for certain beneﬁciaries regardless of their eligibility. To receive the temporary increased FMAP,
states must provide continuous coverage to Medicaid beneﬁciaries who were enrolled in Medicaid
on or after March 18, 2020, regardless of any changes in circumstances or redeterminations at
scheduled renewals that otherwise would result in termination, through the end of the month
in which the public health emergency ends, among other requirements. States may terminate
coverage for individuals who request a voluntary termination of eligibility, or who are no longer
considered to be residents of the state. As shown in the ﬁgure below, from February 2020
through August 2020—the last month for which updated data were available at the time of our
reporting—Medicaid enrollment increased by 5.6 million, or 9 percent. Preliminary data for
September 2020 suggest this trend continued, with almost 780,000 individuals added to the
Medicaid rolls over comparable data in August.
147The FMAP is calculated based on each state’s per capita income relative to national per capita income. For the District
of Columbia and U.S. territories, the FMAP is set by statute regardless of their per capita incomes. Additionally, federal
law speciﬁes a maximum amount, or allotment, for federal contributions to Medicaid spending in U.S. territories, in
contrast to the states and the District of Columbia, for which federal Medicaid spending is open-ended.
148Pub. L. No. 116-127, § 6008, 134 Stat. 178, 208-09 (2020) (“FFCRA”).
149FFCRA, § 6004(a)(3), 134 Stat. at 205-06.
Page 99
GAO-21-387

Medicaid Enrollment from October 2019 through September 2020, Preliminary and Updated Data
Notes: Enrollment counts presented in this ﬁgure generally represent the total unduplicated number of individuals enrolled
in comprehensive beneﬁts as of the last day of the reporting period. Some states reported their data diﬀerently. States report
preliminary data soon after the close of the reporting month; the preliminary enrollment counts generally do not include
individuals with retroactive eligibility or individuals whose applications were not fully processed before the end of the month.
States report updated data about one month later; these data are considered more complete because they account for
individuals in both of these groups.
Medicaid operations. According to CMS, during the public health emergency all states have
delayed processing eligibility and enrollment actions.150 In December 2020, CMS issued guidance
to states on resuming normal eligibility and enrollment operations after the end of the public
health emergency. These operations include processing applications received during the public
health emergency, redetermining Medicaid eligibility and terminating coverage, as appropriate; for
example, terminating coverage for beneﬁciaries who no longer meet eligibility requirements, but
remained enrolled during the public health emergency due to FFCRA requirements. As shown in
the ﬁgure below, CMS expects states to resume timely processing of all eligibility and enrollment
actions within 6 months of the end of the public health emergency.
150Federal regulations provide states with an exception to meeting the timeliness standards for processing Medicaid
applications and redeterminations caused by an administrative or other emergency beyond the agency’s control.
Page 100
GAO-21-387

Centers for Medicare & Medicaid Services Guideline for States Resuming Timely Medicaid Eligibility and
Enrollment Actions
Medicaid oﬃcials we interviewed in selected states said that CMS has taken helpful actions
throughout the public health emergency, such as issuing guidance and being responsive to states’
questions, but also expressed concerns about returning to normal operations. For example,
oﬃcials in all eight states we interviewed reported that they were concerned about resuming
timely processing of eligibility and enrollment actions. According to CMS’s December 2020
guidance, CMS expects this to be completed within 6 months of the end of the public health
emergency. Oﬃcials in one of the states we interviewed noted that it would be challenging to
resume normal operations by this date, since the state will need to resolve the backlog of eligibility
redeterminations that have developed since the public health emergency began. Oﬃcials in one
of the states we interviewed expressed concerns about smoothly enrolling beneﬁciaries who
are no longer eligible for Medicaid into other health insurance coverage, and noted that a health
insurance exchange open enrollment period during the transition would be helpful.
In January 2021, the Acting Secretary Health and Human Services issued a letter to state governors
indicating that the public health emergency will likely continue through the end of 2021, and
that the department will provide states with 60 days’ notice prior to ending the public health
emergency. Medicaid oﬃcials in one of the states we interviewed had said that suﬃcient notice of
the end of the public health emergency was important for a timely return to normal operations.
Medicaid spending. As of February 28, 2021, COVID-19-related federal Medicaid expenditures
totaled approximately $33 billion, or 7 percent of total federal spending on Medicaid services
Page 101
GAO-21-387

for this time period.151 The majority of the COVID-19-related spending is for the 6.2 percentage
point FMAP increase. The temporary FMAP increase will extend through the end of the quarter
in which the public health emergency ends. Medicaid oﬃcials in seven of the eight selected
states said that the increased FMAP was among the most important Medicaid program changes,
for example, to increase provider payments and provide services to an increasing number of
beneﬁciaries. Oﬃcials in one of the states we interviewed suggested extending the increased
FMAP an additional quarter following the end of the public health emergency. These Medicaid
oﬃcials anticipated the state budget would fall short of Medicaid program needs in the months
following the end of the public health emergency.
Our prior work has shown that state budget challenges can persist well beyond the end of a
recession. In June 2020, we urged Congress to use GAO’s FMAP formula to determine the timing
and increase in FMAP for any future changes to the current or any future economic downturn.
The increased FMAP formula targets variable state Medicaid needs and provides assistance that
is automatic, timely (both when to begin and to gradually end assistance), and temporary in
response to national economic downturns. Improving the responsiveness of federal assistance
to states during economic downturns would facilitate state budget planning, provide states with
greater ﬁscal stability, and better align federal assistance with the magnitude of the economic
downturn’s eﬀects on individual states. In January 2021, the Medicaid and CHIP Payment and
Access Commission approved a recommendation that Congress should adopt a statutory
mechanism to amend the Social Security Act to provide an automatic Medicaid countercyclical
ﬁnancing model, using the prototype we developed as a basis.
The remainder of COVID-19-related spending—about $20 million—was reported by 13 of the
19 states and territories approved to cover COVID-19 diagnostic testing and related services for
uninsured individuals with a 100 percent federal match.152
The table below summarizes federal Medicaid spending related to the 6.2 percentage point FMAP
increase, COVID-19 expenditures in Medicaid programs approved to cover testing for uninsured
individuals, and total Medicaid spending for services as of February 28, 2021.
151The most recent available payment information is for the second quarter of ﬁscal year 2020 (January 1, 2020,
through March 31, 2020) through the ﬁrst two months of the second quarter of ﬁscal year 2021 (January 1, 2021,
through February 28, 2021). States can report payments and adjustments to payments up to 2 years after a quarter
ends. The increased FMAP is available for Medicaid medical assistance expenditures for which each state’s standard
state-speciﬁc FMAP rate is used to determine federal funding.
152Three states and three territories that are approved to cover COVID-19 diagnostic testing and related services for
uninsured individuals with a 100 percent federal match did not report COVID-19 expenditures for these individuals as of
February 28, 2021.
Page 102
GAO-21-387

Federal Medicaid COVID-19 and Total Expenditures, by State and Territory, as of February 28, 2021
State or territory
COVID-19-related federal
Medicaid expenditures from
the 6.2-percentage-point-
increased FMAP
($ millions)
COVID-19-related federal
Medicaid expenditures
for uninsured testing
($ millions)
Total federal Medicaid
services expenditures
($ millions)
Alabama
378
N/A
4,819
Alaska
65
N/A
1,498
Arizona
629
N/A
12,366
Arkansasa
337
N/A
5,900
California
4,015
19
65,432
Colorado
465
< 1 million
5,970
Connecticutb
297
< 1 million
4,096
Delawareb
120
N/A
1,689
District of Columbia
167
N/A
2,509
Florida
1,667
N/A
17,962
Georgia
692
N/A
8,323
Hawaiia
110
N/A
1,684
Idaho
129
N/A
2,053
Illinoisa
1,226
< 1 million
16,234
Indiana
744
N/A
11,276
Iowa
283
< 1 million
3,988
Kansas
242
N/A
2,552
Kentuckya
520
N/A
10,203
Louisiana
565
< 1 million
10,055
Maine
178
< 1 million
2,342
Maryland
566
N/A
7,854
Massachusetts
985
N/A
11,266
Michigan
937
N/A
14,543
Page 103
GAO-21-387

State or territory
COVID-19-related federal
Medicaid expenditures from
the 6.2-percentage-point-
increased FMAP
($ millions)
COVID-19-related federal
Medicaid expenditures
for uninsured testing
($ millions)
Total federal Medicaid
services expenditures
($ millions)
Washingtonb
541
N/A
9,598
West Virginia
201
0
3,486
Wisconsin
600
N/A
6,413
Wyominga
35
N/A
365
States total d
33,018
20
454,585
American Samoa
3
N/A
40
Guam
4
N/A
105
Northern Mariana Islands
3
0
42
Puerto Rico
100
0
2,456
Virgin Islands
3
0
73
Territories total d
113
0
2,715
Legend:
FMAP = federal medical assistance percentage
N/A = Not applicable. States that are not approved to provide COVID-19 testing for uninsured individuals as of February 28, 2021.
Source: GAO analysis of Centers for Medicare & Medicaid Services’ data accessed on March 1, 2021. | GAO-21-387
Note: COVID-19 related and total federal Medicaid expenditure data were available for the second, third, and fourth quarters
of ﬁscal year 2020 (January 1, 2020, through September 30, 2020), and for the ﬁrst quarter of ﬁscal year 2021 (October 1, 2020,
through December 31, 2020). Some preliminary expenditure data were also available for the ﬁrst two months of the second
quarter of ﬁscal year 2021 (January 1, 2021, through February 28, 2021). States are not required to report expenditures for
the second quarter of ﬁscal year 2021 until April 30, 2021, 30 days after the end of the quarter. Expenditures do not include
expenses for program administration. State expenditures are reviewed by states and certiﬁed as being Medicaid allowable
expenditures. Both certiﬁed and uncertiﬁed state expenditures are preliminary, as they are subject to further review and are
likely to be updated as states continue to report their expenditures and receive federal matching funds. States can report
payments and adjustments to payments up to 2 years after a quarter ends. Expenditure data are certiﬁed unless otherwise
noted.
aFive states reported preliminary expenditures for the ﬁrst two months of the second quarter of ﬁscal year 2021 (January 1,
2021, through February 28, 2021), with only Hawaii having certiﬁed its expenditures thus far.
bSix states reported uncertiﬁed expenditures for the ﬁrst quarter of ﬁscal year 2021 (October 1, 2020, through December 31,
2020).
cOne state reported uncertiﬁed expenditures for the fourth quarter of ﬁscal year 2020.
dTotals may not sum exactly due to rounding.
State waivers and ﬂexibilities. As of December 17, 2020, CMS reported that the agency had
approved more than 600 diﬀerent waivers, state plan amendments, and other ﬂexibilities to
provide states with ﬂexibility to respond to the public health emergency. Common types of
ﬂexibilities that states sought and CMS approved are shown in the table below.
Page 105
GAO-21-387

Common Types of State Flexibilities Approved by Centers for Medicare & Medicaid Services since March 16, 2020
Purpose of
ﬂexibility
Speciﬁc state ﬂexibilities approved
Maintain beneﬁciary
eligibility for services
• Suspended fee-for-service prior authorizations, which are used to demonstrate compliance
with coverage and payment rules before beneﬁciaries can obtain certain services, rather than
after the services have been provided.a
• Extended the dates for reassessing and reevaluating beneﬁciaries’ needs, which are normally
required for beneﬁciaries to retain eligibility for some home- and community-based services.b
Expand beneﬁciary
eligibility
• Permitted virtual evaluations, assessments, and person-centered planning normally
conducted in person.b
• Expanded coverage to uninsured individuals for COVID-19 testing.c
Remove obstacles to
beneﬁciary access to
care
• Allowed telehealth to continue to provide some services that were previously provided in
person.c
• Allowed early reﬁlls of certain medications to avoid interruption in care.c
Increase the
availability of
providers
• Waived some requirements to allow licensed out-of-state providers to enroll in their
programs to maintain provider capacity.a,d
• Authorized payments changed or added for telehealth services.c
Source: GAO analysis of Centers for Medicare & Medicaid Services approval documentation for states and District of Columbia. | GAO-21-387
aStates received approval under section 1135 of the Social Security Act, which authorizes the Secretary of Health and Human
Services to temporarily waive or modify certain federal health care program requirements, including Medicaid requirements, to
ensure that suﬃcient health care items and services are available to meet the needs of enrollees during an emergency.
bStates received approval to make changes to their section 1915(c) home- and community-based services waivers under an
Appendix K amendment in order to respond to the emergency.
cStates received approval to revise policies in their Medicaid state plan related to eligibility, enrollment, beneﬁts, premiums and
cost sharing, and payments. To make these changes, states must submit a State Plan Amendment to the Centers for Medicare
& Medicaid Services for approval.
dStates approved to temporarily enroll licensed out-of-state providers must follow certain requirements, which include
screening providers to ensure they are enrolled in the Medicaid program and licensed in the state relating to their Medicaid
enrollment. Waiver of these federal requirements does not aﬀect state or local licensure requirements.
Medicaid oﬃcials from the selected states we interviewed reported that these ﬂexibilities were
important for fulﬁlling their states’ Medicaid program mission. For example, Medicaid oﬃcials
from all eight states noted that ﬂexibilities to remove obstacles to beneﬁciary access to care,
such as the use of telehealth, have been among the most important during the public health
emergency. A Medicaid oﬃcial in one of the states we interviewed said ﬂexibilities permitting
virtual evaluations, for example, provided Medicaid beneﬁciaries with an added sense of security
and safety, while providing needed care.
Oﬃcials from all eight states we interviewed reported considering making certain ﬂexibilities
approved during the public health emergency permanent after the public health emergency has
Page 106
GAO-21-387

ended, in particular regarding telehealth. We will continue to monitor the use of services through
telehealth, given the oversight challenges presented by the size, growth, and diversity of the
Medicaid program.
Oversight of state Medicaid waivers and ﬂexibilities. In our June 2020 report, we raised
concerns about the potential eﬀects of state ﬂexibilities, including improper Medicaid payments.
In December 2020, CMS reported that the agency plans to release guidance speciﬁc to COVID-19
program integrity issues, including beneﬁciary eligibility. According to CMS, the guidance will
outline expectations for states to establish regular Medicaid program integrity operations both
during and after the public health emergency, taking into account new changes to state programs
as a result of implementing COVID-19 ﬂexibilities. CMS oﬃcials have also reported that the agency
is conducting and updating risk assessments for all Medicaid waivers and ﬂexibilities issued
as a result of the public health emergency. As of January 2021, CMS still plans to release the
aforementioned guidance, which will include a discussion of CMS’ Medicaid risk assessment, so
that states appropriately account for the risks and vulnerabilities associated with the Medicaid
waivers and ﬂexibilities. CMS has not speciﬁed when program integrity guidance will be released.
We will continue to monitor CMS’s guidance and state eﬀorts and report on our ﬁndings going
forward.
Single audit requirements. The Single Audit Act establishes a requirement for federal award
recipients (e.g., states, the District of Columbia, local governments, U.S. territories, Indian tribes,
and nonproﬁt organizations) to undergo a single audit when federal award expenditures meet
a certain dollar threshold in a ﬁscal year. The Oﬃce of Management and Budget (OMB) issued
new guidance as to the applicability of the single audit to COVID-19 relief funding, including how
to conduct such audits. Likewise, many federal awarding agencies issued new guidance to award
recipients on how those funds should be reported and spent. CMS released several Frequently
Asked Questions (FAQs) to provide guidance to state Medicaid agencies in their response to
COVID-19 and implementation of the FFCRA and the CARES Act.
Single audits are essential in identifying deﬁciencies in the award recipient’s compliance with
applicable provisions of laws, regulations, contracts, or grant agreements and in its ﬁnancial
management and internal control systems. Correcting such deﬁciencies can help ensure the
appropriate use of federal funds and reduce the likelihood of federal improper payments.
Medicaid is on GAO’s 2019 High-Risk list and has the largest reported amount of estimated
improper payments out of all federal government programs determined to be susceptible to
signiﬁcant improper payment. For ﬁscal year 2020, HHS reported that Medicaid’s total estimated
improper payments was about $86.5 billion, representing about 42 percent of the total $206.4
billion government-wide estimated improper payments reported for that ﬁscal year. Auditors who
conduct single audits follow guidance in the Single Audit Act’s Compliance Supplement, which
OMB updates and issues annually in coordination with federal agencies. Refer to the Single Audits
enclosure for more information on single audits.
Page 107
GAO-21-387

Agency Comments
We provided a draft of this enclosure to HHS and the Oﬃce of Management and Budget for review
and comment. HHS provided technical comments, which we incorporated as appropriate. The
Oﬃce of Management and Budget did not provide comments on this enclosure.
Methodology
To conduct this work, we reviewed federal laws and CMS data from both its Medicaid expenditure
reporting system and Medicaid and CHIP performance indicators project. We also reviewed CMS
Medicaid guidance, including requirements for administering the optional COVID-19 testing
for the uninsured and resuming normal state eligibility and enrollment operations after the
end of the public health emergency; and our prior work related to Medicaid. We also reviewed
CMS guidance to states on reporting COVID-19 expenditures through the Medicaid expenditure
reporting system and conducted data reliability checks on both the state reported-expenditure
data and performance indicators. We determined that the CMS data were suﬃciently reliable for
the purpose of this enclosure.
We also interviewed Medicaid oﬃcials from eight selected states regarding ﬂexibilities they
requested during the public health emergency, CMS assistance in obtaining and implementing
these ﬂexibilities, and plans for resuming normal operations after the public health emergency has
ended. We selected states based on geographic diversity, size of the state Medicaid program, and
approved Medicaid ﬂexibilities.
Contact information: Carolyn L. Yocom, (202) 512-7114, yocomc@gao.gov
Page 108
GAO-21-387

Veterans Health Care
The Veterans Health Administration, within the Department of Veterans Aﬀairs, began executing
its COVID-19 vaccination plan following the Food and Drug Administration’s emergency use
authorization of the Pﬁzer-BioNTech COVID-19 vaccine in December 2020. Its vaccination eﬀort
could beneﬁt from performance targets and improved metrics for vaccine administration.
Entities involved: Veterans Health Administration, within the Department of Veterans Aﬀairs
Recommendations for Executive Action
The Department of Veterans Aﬀairs Under Secretary for Health should develop metrics to assess
the number of vaccines administered by vaccine rollout phase to better assess progress and make
any necessary adjustments as needed. VA agreed with our recommendation.
The Department of Veterans Aﬀairs Under Secretary for Health should develop preliminary
vaccination targets for when it will move from one vaccination phase to another; or within one
phase, from one group of veterans to another. VA agreed in principle with our recommendation.
The Department of Veterans Aﬀairs Under Secretary for Health should collect data on the number
of staﬀ and veterans who do not show up for a vaccination appointment to better monitor for
completion of the second dose of the vaccine. VA agreed with our recommendation.
Key Considerations and Future GAO Work
The Department of Veterans Aﬀairs (VA) has used COVID-19 relief funds to vaccinate veterans and
Veterans Health Administration (VHA) staﬀ. As of March 10, 2021, about 908,000 veterans and
243,000 staﬀ have been fully vaccinated (i.e. received required two doses of the Moderna or Pﬁzer
vaccines, or one dose of the Janssen (Johnson & Johnson) vaccine) by VHA.
We will continue to examine VA’s vaccination eﬀorts, including ongoing work, reviewing how the
department used COVID-19 relief funds to distribute and administer vaccines. In addition, we have
ongoing work focusing on the vaccination of veterans and staﬀ at VA community living centers.
Background
VA, through VHA, provides health care services to approximately 10 million enrolled veterans.
Veterans can access services at one of VHA’s 1,294 sites of care, which includes 170 VA medical
centers and about 1,000 outpatient sites. VHA is leading VA’s eﬀorts for the distribution of
COVID-19 vaccines.
In September 2020, VHA began planning for the availability of a COVID-19 vaccine, and developed
the COVID-19 Vaccination Plan for the Veterans Health Administration, which was most recently
Page 109
GAO-21-387

updated on December 14, 2020.153 The document describes several aspects of VHA’s vaccination
plan, which include
• the guiding principles and priorities of VHA’s vaccination eﬀort, such as the safety of veterans
and staﬀ;
• how VHA will operationalize these principles, for example by developing and implementing a
plan to distribute the vaccines to facilities, and for administering vaccinations to veterans and
staﬀ;
• roles and responsibilities of national leadership, Veterans Integrated Service Network
leadership, and VA medical center leadership;154
• development of an integrated project team to review feedback from VHA staﬀ and recommend
revisions to plans and products about the COVID-19 vaccines;155 and
• the creation of workgroups to develop vaccine communication, vaccine distribution plans, and
vaccination metrics among other things.
Starting in December 2020, the Food and Drug Administration (FDA) took several steps to pave the
way for vaccine distribution and administration nationally. Speciﬁcally, on December 11, 2020, FDA
issued an emergency use authorization (EUA) for the Pﬁzer-BioNTech (Pﬁzer) COVID-19 vaccine.156
A week later, on December 18, 2020, FDA issued an EUA for the Moderna vaccine. More recently
on February 27, 2021, FDA issued an EUA for the Janssen vaccine.157
After the ﬁrst EUA was in place, on December 16, 2020, VA released guidance through a memo
to Veterans Integrated Service Network and VA medical center leadership detailing how vaccines
would be distributed to sites, how to schedule vaccination appointments, how to document
administering the vaccine, and information on training and data reporting requirements.158
153Department of Veterans Aﬀairs, COVID-19 Vaccination Plan for the Veterans Health Administration, Version 2.0
(Washington, D.C.: Dec. 14, 2020).
154Veterans Integrated Service Networks are regional networks responsible for managing and overseeing VA
medical centers.
155The integrated project team is a multi-disciplinary team comprised of stakeholders from across VHA, including
those with clinical and operational expertise—e.g., representatives from pharmacy, nursing, oﬃce of community
care, and labor and management relations.
156During an emergency, as declared by the Secretary of Health and Human Services under 21 U.S.C. § 360bbb-3(b), FDA
may temporarily authorize unapproved medical products or unapproved uses of approved medical products through
an emergency use authorization, provided certain statutory criteria are met. For example, an EUA request must include
evidence that the vaccine may be eﬀective and that the known and potential beneﬁts outweigh the known and potential
risks, among other requirements. (See our November 2020 report on vaccination EUAs. GAO-21-207)
157According to VA oﬃcials, it is updating its COVID-19 Vaccination Plan to reﬂect the EUA for the Janssen COVID-19
vaccine.
158Department of Veterans Aﬀairs, Department of Veterans Aﬀairs (VA) Guidance on COVID-19 Vaccine, (Washington, D.C.:
Dec. 16, 2020).
Page 110
GAO-21-387

VA updated this guidance on December 23, 2020.159 In addition, beginning on December 29,
2020, VA published vaccine information in Spanish and on January 26, 2021 began publishing the
information in Tagalog.
VHA received approximately $17.2 billion in supplemental appropriations from the CARES Act to
assist its response to COVID-19. According to VHA oﬃcials, they expect staﬃng to be the primary
cost associated with vaccine distribution.160 As part of the American Rescue Plan Act of 2021, VA
will receive an additional $14.482 billion of funding for COVID-19 related health care.161
Overview of Key Issues
As of March 11, 2021, VA has recorded 236,176 COVID cases, including about 4,600 active cases
among veterans and 130 active cases among staﬀ. In addition, VA has recorded more than 10,000
known COVID-19 deaths among its patient population and 134 COVID-19 deaths among its staﬀ.
The primary goal of VA’s vaccination eﬀort is to lower the COVID-19 risk of infection and severe
disease. To achieve this goal, VA plans to oﬀer vaccines to the roughly 10 million eligible veterans
currently enrolled in VHA’s health care system and its approximately 419,000 staﬀ. According to
VHA, many enrolled veterans are at a higher risk of infection or severe disease from COVID-19.
For example, more than half of the veteran population enrolled in VHA services are over the age
of 65 and a large proportion have at least one high-risk medical condition, such as cardiovascular
disease. VHA also acknowledges that many staﬀ are at risk for COVID-19, and can potentially
transmit the virus to high-risk veterans. According to VHA, its staﬀ are not required to receive the
vaccine. However, VHA has provided education to its staﬀ on vaccine safety and education and
they are encouraged to become vaccinated.
VHA’s vaccination approach. VHA has a phased approach for its vaccination eﬀort. Veterans and
staﬀ are prioritized based on their risk for either COVID-19 transmission, morbidity, or mortality,
with higher risk individuals included in earlier phases. According to VHA, a risk-based phased
approach is necessary as demand for the vaccine continues to outpace supply. VHA’s approach
follows a risk stratiﬁcation framework based on the Centers for Disease Control and Prevention
(CDC) guidance, and VHA’s previous vaccination eﬀorts.162 See table below for details on VHA’s
vaccination prioritization and phases.
159Department of Veterans Aﬀairs, Updated: Department of Veterans Aﬀairs Guidance on COVID-19 Vaccine, (Washington,
D.C.: Dec. 23, 2020).
160VA primarily receives funding for all health care it provides or purchases through four separate accounts. The
medical services account includes appropriations for health care services VA provides to eligible veterans, the medical
community care account includes appropriations for services VA authorizes for veterans and other beneﬁciaries to
receive in the community, the medical support and compliance account is used for medical and research activities, and
the medical facilities account is used for operation and maintenance of VHA’s infrastructure.
161American Rescue Plan Act of 2021, Pub. L. No. 117-2, 135 Stat. 4.
162CDC’s guidance includes recommendations for prioritizing high-risk groups, such as health care personnel and
individuals 75 and older, to receive vaccine doses ﬁrst. CDC’s vaccine guidance allows for ﬂexibility as a way to ensure
equitable administration of vaccine doses. For example, agencies can decide to further prioritize within a particular
phase.
Page 111
GAO-21-387

Veterans Health Administration (VHA) COVID-19 Vaccination Phases and Prioritization, December 14, 2020
Phase a
Types of VHA staﬀ who will
receive vaccines
Groups of veterans who will receive vaccine
1a
All health care personnel
Veterans in VHA long term care facilities and
inpatients at VHA Spinal Cord Injuries and Disorders
Centers
Veterans 75 and older receiving VHA care
Veterans under the age of 75 who are in high
risk groups, such as veterans experiencing
homelessnessb
1b
Veterans who are frontline essential workers as
deﬁned by CDCc
Veterans 65-74 years of age receiving VHA care
Veterans with a high-risk condition, such as cancer or
obesity
1c
Other VHA personnel, non-health
care staﬀ
Other essential workers as deﬁned by CDC
Source: Department of Veterans Aﬀairs, COVID-19 Vaccination Plan for the Veterans Health Administration. | GAO-21-387
Notes: VHA’s vaccination prioritization is for eligible veterans enrolled in its health care system.
aVHA’s risk stratiﬁcation is based on Centers for Disease Control and Prevention (CDC) guidance and VHA’s previous vaccination
eﬀorts. CDC’s guidance includes recommendations for prioritizing high-risk groups, such as health care personnel and long-
term care residents, to receive vaccine doses ﬁrst. CDC’s guidance allows for ﬂexibility. For example, agencies can decide to
further prioritize within a particular group.
bVHA considers veterans in these groups high risk because they have either an increased risk of COVID-19 transmission and
mortality.
cCDC deﬁnes essential workers as those individuals who conduct a range of operations and services in industries that are
essential to ensure the continuity of critical functions in the United States. Examples of Phase 1b essential workers include
grocery store workers, postal workers, and public transit workers.
In addition, VHA developed a tool for facilities to help identify high-risk veterans. The tool identiﬁes
veterans by conditions such as age and comorbidities, which are known to elevate risk associated
with COVID-19. According to oﬃcials from several VA medical centers in our review, the tool has
been helpful in determining which staﬀ and veterans to vaccinate ﬁrst.
VHA’s top priorities are staﬀ and veterans who are most at risk of contracting COVID-19 and of
having the most severe symptoms. In particular, VA has prioritized:
Community living centers. According to CDC data, 21 percent of COVID-19 deaths have occurred in
nursing home facilities, including community living centers (CLC)—which are owned and operated
by VHA.163 According to VHA’s risk stratiﬁcation framework, staﬀ working in CLCs were the ﬁrst
163According to CDC data, between January 1, 2020, and February 13, 2021, 96,864 deaths involving COVID-19 have
occurred in nursing homes. See: https://www.cdc.gov/nchs/nvss/vsrr/covid_weekly/index.htm, accessed on February 22,
2021.
Page 112
GAO-21-387

group of staﬀ to be vaccinated because they interact with a greater number of residents and can
more easily spread the virus. Veterans residing in CLCs were the ﬁrst veterans to be vaccinated.
According to VHA data we reviewed, 95 percent of CLC residents have received at least one dose of
vaccine, and 86 percent have been fully vaccinated as of March 14, 2021.
Homeless veterans. Homeless veterans are also among the ﬁrst groups of veterans eligible to
receive a vaccine in VHA’s stratiﬁcation framework. According to VHA, homeless veterans are a
priority because they are at an increased risk of needing to be in congregate living settings where
there is increased risk of infection, particularly during the winter months. Further, according to
VHA, homeless veterans are more likely to have high-risk health conditions and be older, elevating
the risk of morbidity and mortality from COVID-19. According to VHA oﬃcials, outreach eﬀorts
include bringing vaccine to homeless veterans in VA-funded congregate living environments, and a
laminated pocket card with information about COVID-19 vaccination at VHA.
VHA estimates that as of December 14, 2020, there were about 242,000 homeless veterans. As of
March 14, 2021, VHA data show that 41,253 homeless veterans have received at least one dose of
vaccine, and 21,574 have been fully vaccinated.
VHA’s progress in distributing and administering vaccines. On December 14, 2020, VHA began
distributing the initial doses of the Pﬁzer vaccine to 37 facilities. VHA reported that these facilities
were selected because they had the ultra-cold storage capacity necessary for storage of the
vaccine.164 On December 21, 2020, VHA began distributing initial doses of the Moderna vaccines
to 113 facilities that were identiﬁed based on factors such as their ability to appropriately store
the vaccine. According to VHA, the Moderna vaccine is more suitable for smaller facilities due to
less stringent cold storage requirements and smaller minimum order size, and it plans to focus
distribution of those vaccines to rural and remote areas.165 On March 3, 2021, VA received its ﬁrst
doses of the Janssen (Johnson & Johnson) vaccine. According to VA, the Janssen vaccine will help
VA more eﬀectively reach rural veterans as it only requires one dose. As of March 18, 2021, 868 of
VHA’s 1,294 sites of care had received vaccine doses. VHA reported that it will distribute vaccines
to additional facilities as vaccination supply increases.
As of March 10, 2021, VHA facilities had administered about 2.5 million vaccine doses to veterans
and about 518,000 vaccine doses to staﬀ. See ﬁgure below for details on the number of doses VHA
has received, and administered.
164According to FDA, the Pﬁzer vaccine must be stored in ultra-cold conditions between -112 and -76 degrees
Fahrenheit, and the two doses should be separated by three weeks.
165According to FDA, the Moderna vaccine must be stored frozen between -13 and 5 degrees Fahrenheit, and the two
doses should be separated by 1 month.
Page 113
GAO-21-387

Department of Veterans Aﬀairs COVID-19 Vaccine Administration, as of March 10, 2021
Note: Both the Pﬁzer and Moderna vaccines require two doses separated by 3 weeks and 1 month, respectively. The Janssen
vaccine requires one dose. Fully vaccinated individuals have either had two doses of the Pﬁzer or Moderna vaccines, or one
dose of the Janssen vaccine.
VHA facilities noted challenges in planning due to vaccine allocation changes and
uncertainty. Staﬀ at VHA facilities in our review—12 facilities that received the Pﬁzer vaccine
and 12 facilities that received the Moderna vaccine—told us that predictable vaccine allocation,
or speciﬁed doses of vaccines to be made available, would improve their ability to plan for
administration of the vaccine.
• Facilities plan based on their assigned allocations of vaccines, which are based on the number
of staﬀ and veterans receiving care at a facility who are in speciﬁc risk categories (see above
table showing COVID-19 vaccination phases and prioritization for details).
• Staﬀ from 18 of the 24 facilities in our review told us the vaccine supply chain was a challenge
for several reasons, including the timeline for vaccine delivery changing and not receiving the
quantity of vaccine they ordered. For example, staﬀ at one facility reported to us receiving
three times the amount of vaccine they initially planned for and noted that the facility had
to make last-minute staﬃng changes to accommodate the increase. Further, staﬀ from
several of these 18 facilities told us that the uncertainties created challenges in scheduling
appointments, staﬃng clinics, and accurately communicating with veterans and staﬀ about
what to expect.
• Staﬀ from some facilities in our review told us that uncertainty is challenging to manage
because vaccination eﬀorts are labor intensive to plan for and coordinate with staﬀ. For
example, vaccination clinics require coordination across a multidisciplinary team, such as staﬀ
from pharmacy, public aﬀairs, scheduling, and information technology (IT) management. In
addition, staﬀ from some facilities told us the high volume of veterans to call and schedule for
vaccination appointments, and the number of staﬀ necessary to operate vaccination clinics is
challenging.
Page 114
GAO-21-387

Although VHA has received most of the vaccine doses it has ordered, VHA oﬃcials said planning
at the facility level is challenging because VA learns its allocation of vaccine approximately one
week in advance. Speciﬁcally, VA learns its weekly allocation of vaccine each Tuesday—it then uses
its risk stratiﬁcation framework to determine how these vaccines will be distributed across the
country—and doses arrive on site between Monday and Thursday the following week.
VHA may face diﬃculties in assessing vaccination progress. Although VHA has outlined a
phased vaccination approach, it has not developed metrics for tracking vaccines by phase, has not
created vaccination targets for each phase, and does not track no-show appointments.
Phase-speciﬁc data. VHA is utilizing a phased vaccine rollout; however, VHA’s current metrics do
not capture vaccine data by phases. VHA’s vaccination phases may include veterans based on
a combination of factors. For example, Phase 1c includes veterans who are 65 and older and
veterans under the age of 65 who have high-risk conditions or are essential workers.166 According
to VHA oﬃcials, VHA does not have data on all factors that deﬁne a particular phase, such as
employment data to identify essential workers. However, VHA oﬃcials stated they are able to track
age and health condition data, which includes the majority of some phases, such as 1b. Using
data VHA currently has access to, VHA may be able to create metrics for some vaccination phases.
VHA’s lack of data by vaccination phase is inconsistent with our Standards for Internal Control in
the Federal Government, which states that management should use quality information to achieve
objectives. Without the ability to review vaccination data by phase, VHA is not able to determine
which facilities may be at an earlier phase than others and direct resources or assistance to those
facilities.
Vaccination targets. VHA does not have targets as to when it will move from one vaccination phase
to another; or within one phase, from one group of veterans to another. This lack of vaccination
targets is inconsistent with eﬀective management practices. We have previously reported that
developing measurable targets is an eﬀective practice to assess progress in meeting program
goals.
VHA stated that creating vaccination targets is currently challenging given that vaccine supply
currently lags demand that and the amount of vaccine available to VHA is unpredictable and
ﬂuctuates from week to week. Although the unpredictable supply of vaccine doses may prevent
VHA from developing absolute targets, our previous work has shown that setting preliminary
targets is an eﬀective strategy when an agency cannot develop absolute targets. Without
preliminary vaccination targets, VHA may not be able to determine its progress in vaccinating staﬀ
and veterans who have the highest risk, and signal to those lower risk groups when they might
anticipate being vaccinated.
Appointment no-show data. VHA does not have metrics related to staﬀ and veterans who do not
show (no-shows) for their vaccination appointments, which is inconsistent with its own vaccination
goal to track vaccine administration and completion of both doses of vaccine. 167 In addition,
166CDC deﬁnes essential workers as those individuals who conduct a range of operations and services in industries that
are essential to ensure the continuity of critical functions in the United States. Examples of Phase 1b essential workers
include grocery store workers, postal workers, and public transit workers.
167VA guidance requires that second dose appointments are scheduled at the time of the ﬁrst dose administration.
Page 115
GAO-21-387

Standards for Internal Control in the Federal Government state that management should use quality
information to achieve objectives. Without data on no-shows, VHA may be at an increased risk
for not being able to determine the extent to which staﬀ and veterans are not showing for
appointments for their second vaccinations, and may miss opportunities to better target outreach
to individuals not showing up for appointments. Oﬃcials told us that VHA is collecting data
required by the CDC, which does not include no-show appointments.168
VHA’s outreach to minority and rural veterans. We have previously reported—including in
our December 2019 report on opportunities for VA to address racial and ethnic disparities—that
racial and ethnic minority veterans have had worse health outcomes for some diseases. Further,
members of speciﬁc racial and ethnic minority populations, including Black, Hispanic, American
Indian, or Alaska Native, have borne a disproportionate share of COVID illness and death in the
United States, according to CDC data. (See our related Health Disparities enclosure for more
information. VHA’s vaccination plan acknowledges the importance of equitably administering the
vaccine, and describes steps taken by the agency to develop communication products targeted
at minority and rural veterans. (See tables below for information on vaccines delivered to certain
veteran groups, by race and ethnicity, as of March 11, 2021.)
Since beginning vaccinations in mid-December 2020, VHA reported that its COVID-19
Communications Team meets regularly with a variety of stakeholders, including veterans groups
representing diﬀerent racial and ethnic populations and minority outreach coordinators.169 These
eﬀorts led VHA to take several actions, including developing videos to address vaccine hesitancy.
For example, according to VHA oﬃcials, one video features clinicians discussing vaccine hesitancy
and why they chose to be vaccinated. According to VHA oﬃcials, these videos are played at VHA
facilities, and shared on multiple platforms, including VA’s social media platforms.
168CDC does not require reporting data on no-show appointments. However, CDC does list reporting these data as
optional. See: https://www.cdc.gov/vaccines/covid-19/reporting/requirements/index.html.
169The VHA COVID-19 Vaccine Communications Workgroup is responsible for communications products that provide
awareness and information about VHA’s COVID-19 vaccination program
Page 116
GAO-21-387

Administration of vaccine to veterans aged 65 and older by race as of March 11, 2021
Race
Number of veterans that are fully vaccinated
White
634,240
Black or African American
111,901
Multiple
4,830
Asian
6,225
American Indian or Alaskan Native
3,961
Native Hawaiian or Other Paciﬁc Island
5,584
Unknown
37,541
Declined to answer
21,418
Total
825,701
Source: GAO analysis of Department of Veterans Aﬀairs data. | GAO-21-387
Page 117
GAO-21-387

Administration of vaccine to veterans aged 65 and older by ethnicity as of March 11, 2021
Ethnicity
Number of veterans that are fully vaccinated
Non-Hispanic or Latino
739,233
Hispanic or Latino
41,230
Unknown
32,292
Declined to answer
12,946
Total
825,701
Source: GAO analysis of Department of Veterans Aﬀairs data. | GAO-21-387
VHA oﬃcials told us that they anticipated it would be a challenge to deliver vaccine doses to
rural areas because of constraints around storage and handling of the vaccine. Staﬀ from several
facilities in our review said it was challenging to distribute doses of vaccine from VA medical
centers to community-based outpatient clinics due to storage and handling requirements.
Speciﬁcally, VHA oﬃcials said both the Pﬁzer and Moderna vaccines—which must be stored
-70 and -20 degrees, respectively—require 24/7 temperature monitoring and staﬀ availability
to address any temperature deviations. According to VHA, smaller facilities may not have
staﬀ available 24/7 to address potential deviations. Further, according to VHA oﬃcials, the
requirements for transporting vaccine make doing so challenging.
Since beginning vaccinations, VHA has made adjustments to address these challenges and get
more vaccine into rural communities. For example, VHA initially required facilities to have backup
power in place to ensure continuous maintenance and monitoring of vaccine temperature.
According to VHA oﬃcials, this requirement was waived to increase the number of locations
eligible to receive vaccine because backup power was not available at smaller community-based
outpatient clinics.
Agency Comments
We provided a draft of this enclosure to VA for review and comment. VA provided technical
and general comments on this enclosure, which we incorporated as appropriate. VA’s general
comments are reproduced in appendix XII.
VA agreed with our recommendation to develop metrics to assess the number of vaccines
administered by vaccine rollout phase in order to better assess progress, and provided a target
completion date of October 2021. VA is using a phased approach to provide vaccines because
vaccine demand currently outpaces supply. Without data by phase, VA is not able to determine
which facilities are at an earlier phase and may require additional resources or assistance to
vaccinate veterans and staﬀ who are at the highest risk.
VA agreed in principle with our recommendation to develop vaccination targets for when it will
move from one vaccination phase to another; or within one phase, from one group of veterans to
Page 118
GAO-21-387

another. Although VA acknowledged there are many factors to consider when moving from one
phase to another, and the importance of ﬂexibility for local conditions, VA did not provide dates
for when it would develop targets. We reiterate the importance of developing preliminary targets
to determine vaccination progress and signal to veterans and employees when they may expect to
be vaccinated.
VA agreed with our recommendation to collect data on the number of staﬀ and veterans who do
not show up for a vaccination appointment to better monitor for completion of second dose of
the vaccine. VA indicated that it is collecting data that can track the completion of ﬁrst and second
doses; however, these data do not indicate if staﬀ or veterans missed their second dose because
they did not show for their appointment. A missed second dose, for example, could be due to
delays in shipment or other supply issues. Without no-show data, VA may miss opportunities to
better target outreach to individuals not showing up for appointments.
Methodology
To conduct this work, we reviewed VHA’s vaccination plan and related guidance for facilities
administering the vaccines. In addition, we analyzed VHA data on the number of COVID-19
vaccines VHA facilities administered from mid-December through March 18, 2021. We assessed
the reliability of the data used in our analyses by conducting manual checks and obtaining written
responses from agency oﬃcials about the data. We determined the data were suﬃciently reliable
for the purpose of this enclosure. We also collected information from 24 VHA facilities—12
facilities that received the Pﬁzer vaccine and 12 facilities that received the Moderna vaccine—to
understand their vaccination experiences. We selected these facilities to reﬂect a range of
geography and complexity level.170 Information from these facilities is not generalizable across
all VHA facilities. We also spoke to representatives from two veteran service organizations, the
American Legion and Paralyzed Veterans of America, to gain additional context.
Contact information: Debra A. Draper, (202) 512-7114, draperd@gao.gov; Sharon Silas, (202)
512-7114, silass@gao.gov
Related GAO Products
COVID-19: Federal Eﬀorts Accelerate Vaccine and Therapeutic Development, but More Transparency
Needed on Emergency Use Authorizations. GAO-21-207. Washington, D.C: November 17, 2020.
VA Health Care: Opportunities Exist for VA to Better Identify and Address Racial and Ethnic Disparities.
GAO-20-83. Washington, D.C.: December 11, 2019.
170VHA categorizes VA medical centers according to complexity level, which is determined on the basis of the
characteristics of the patient population, clinical services oﬀered, educational and research missions, and administrative
complexity.
Page 119
GAO-21-387

Managing for Results: Strengthening Regulatory Agencies’ Performance Management Practices. GAO/
GGD-00-10 . Washington, D.C.: October 28, 1999.
Page 120
GAO-21-387

Military Personnel Vaccinations
The Department of Defense reported 255,716 cumulative, conﬁrmed cases of COVID-19 as of
March 10, 2021; has a phased approach for vaccinating 11.3 million DOD personnel and other
eligible beneﬁciaries; and began administering vaccines in December 2020.
Entities involved: Department of Defense, including the Defense Health Agency, Defense
Logistics Agency, geographic combatant commands, and military departments.
Key Considerations and Future GAO Work
We have ongoing work examining the Department of Defense’s (DOD) vaccination eﬀorts and
broader eﬀorts to protect personnel against COVID-19. We plan to report the results of this work
in spring 2021. We will also continue to monitor DOD’s vaccination progress.
Background
DOD, through its Defense Health Program, provides worldwide medical services to military
personnel and other eligible beneﬁciaries (approximately 9.6 million individuals total) through 475
military medical treatment facilities and the delivery of TRICARE beneﬁts.171 The Defense Health
Agency (DHA) manages and oversees DOD’s immunization programs and leads eﬀorts to plan for
the distribution of COVID-19 vaccines.
Geographic combatant commands, the three military departments, other DOD components,
and the U.S. Coast Guard are responsible for planning distribution of COVID-19 vaccines within
their speciﬁc areas of responsibility. Logistics personnel consolidate requests from medical
treatment facilities or other vaccination sites and send them to the U.S. Army Medical Materiel
Agency Distribution Operations Center, which enters the orders into the Department of Health
and Human Services’ vaccine ordering system.
Overview of Key Issues
Prevalence of COVID-19 among DOD personnel and dependents. As of March 10, 2021, DOD
reported 255,716 cumulative, conﬁrmed cases of COVID-19 among its workforce personnel and
dependents of military servicemembers. See the table below for more detailed information by
personnel category, including for dependents of military servicemembers.
171TRICARE is DOD’s regionally structured health care program that provides purchased care to beneﬁciaries through
networks of civilian providers.
Page 121
GAO-21-387

Number of Cumulative, Conﬁrmed Cases of COVID-19, Hospitalizations, and Deaths Reported by the Department
of Defense (DOD), as of March 10, 2021
Cumulative cases
Hospitalizations
Deaths
Military servicemembers
(active and reserve
components)
166,357
1,424
24
Dependents
25,272
364
10
Civilians
47,070
1,349
202
Contractors
17,017
491
69
Total
255,716
3,628
305
Source: DOD data from defense.gov/explore/spotlight/coronavirus/, accessed March 10, 2021. I GAO-21-387
Note: DOD deﬁnes a “COVID-19 case” as one conﬁrmed by a positive molecular laboratory test and “dependents” as family
members (according to speciﬁed criteria) of military servicemembers.
DOD vaccination approach. In light of the limited supply of COVID-19 vaccines, DOD has
planned and implemented a phased approach to vaccinating up to approximately 11.3 million
eligible personnel, including military servicemembers and their dependents, other beneﬁciaries
(e.g., retired military servicemembers and their dependents), civilian employees, and selected
contractor personnel.172 DOD established a priority framework for determining which groups of
eligible personnel should be vaccinated based on guidance from the Centers for Disease Control
and Prevention (table).
172DOD has included civilians and contractors in its vaccine-eligible population, although these personnel would not
otherwise be eligible for DOD health care services unless they were also a dependent family member of a military
servicemember or of one who has retired. Thus, DOD’s vaccine-eligible population (about 11.3 million) is wider in scope
than its population eligible for health care services (about 9.6 million). DHA oﬃcials have estimated that their target
vaccine-eligible population is actually about 6.9 million individuals because many eligible reservists and National Guard
members, and eligible beneﬁciaries, civilians, and contractors will choose to receive their COVID-19 vaccine from a state-
run facility or private provider.
Page 122
GAO-21-387

Department of Defense (DOD) COVID-19 Vaccine Prioritization for Military Servicemembers, Other Beneﬁciaries,
Civilian Employees, and Contractors
Vaccination
phase
Population group
1a
All health care providers, health care support, and emergency services and public safety personnel
1b
Personnel providing critical national capabilities, personnel forward deployed to austere environments
and those preparing to deploy to locations outside the U.S., DOD beneﬁciaries ages 75 years and older,
and frontline essential workers
1c
DOD beneﬁciaries ages 65–74 and those ages 16–64 with increased risk for severe illness as deﬁned by
the Centers for Disease Control and Prevention, personnel deployed or serving temporary duty for more
than 30 days outside the U.S., and essential workers not previously included in phases 1a or 1b
2
Remaining population ages 16 years and oldera
Source: Defense Health Agency. I GAO-21-387
aAs of February 24, 2021, only the Pﬁzer-BioNTech COVID-19 vaccine is authorized for individuals ages 16 and 17 years.
DHA’s immunization plan includes distributing the ﬁrst available vaccines developed and
authorized through the federal response eﬀort. DOD distributed the ﬁrst two vaccines authorized
for emergency use within days after each authorization was made. Speciﬁcally:
• On December 11, 2020, the Food and Drug Administration (FDA) issued an emergency use
authorization for the Pﬁzer-BioNTech vaccine.173 The same day, the U.S. Army Medical Materiel
Agency Distribution Operations Center—responsible for managing vaccine shipments, to
include tracking them through their delivery to states and territories—initiated shipments
to the ﬁrst of 14 initial vaccination sites within the U.S., selected because of their cold
storage capabilities, proximity to substantial numbers of high-priority personnel, and access
to suﬃcient medical personnel to administer the vaccines and monitor recipients after
vaccination.
• On December 18, 2020, the FDA issued an emergency use authorization for the Moderna
vaccine and, within 2 days, the Army Medical Materiel Agency Distribution Operations Center
initiated vaccine shipments to the ﬁrst of 61 vaccination sites in the U.S. for that week. Within 4
days, the Defense Logistics Agency—responsible for shipments to foreign countries, deployed
locations, and ships—began shipping Moderna doses to locations outside the U.S.
On February 27, 2021, the FDA issued an emergency use authorization for the Janssen (Johnson
& Johnson) single-dose vaccine. DOD began administering the Janssen vaccine on March 2, 2021.
173During an emergency, as declared by the Secretary of Health and Human Services under 21 U.S.C. § 360bbb-3(b),
FDA may temporarily authorize unapproved medical products or unapproved uses of approved medical products
through an emergency use authorization, provided certain statutory criteria are met. For example, an emergency
use authorization request must include evidence that the vaccine may be eﬀective and that the known and
potential beneﬁts outweigh the known and potential risks, among other requirements.
Page 123
GAO-21-387

DHA oﬃcials stated that the immunization plan may incorporate other new vaccines as they are
authorized for emergency use by the FDA, including vaccines that DOD is developing.
Vaccination progress. From December 2020 through February 2021, DOD expanded its number
of vaccination sites in the U.S. and overseas to more than 500 locations, according to brieﬁng
reports to the DHA Director. The percentage of vaccines DOD has administered at these sites
relative to its on-hand supply has increased almost every week since vaccinations began in
December 2020. As shown in the ﬁgure below, as of March 10, 2021, DOD had administered
1,412,016 vaccine doses, or about 87 percent of the doses delivered to its vaccination sites. A
total of 875,707 individuals, or about 13 percent of DOD’s target population of 6.9 million in all
vaccination phases, had received at least one dose, and 536,309 of these individuals had been fully
vaccinated.
Vaccine Doses Received by Department of Defense Vaccination Sites and Administered to Individuals as of
March 10, 2021
Notes: The 6.9 million eligible individuals targeted include those in all phases of DOD’s vaccination plan as of February
2021––phases 1a, 1b, 1c, and 2—who DHA estimates to be most likely to receive their vaccine from DOD rather than from a
state-run facility or private provider. The target population includes eligible military servicemembers (those on active duty,
members of the Selected Reserve including the National Guard, and members of the Coast Guard), military servicemembers
who have retired and their dependent family members, dependent family members of active-duty servicemembers and of
certain reserve component members, civilians, and contractors.
aThe number of doses administered is not equal to the total number of individuals fully and partially vaccinated because the
Pﬁzer-BioNTech and Moderna vaccines for COVID-19 both require two doses for full vaccination, while the Janssen (Johnson &
Johnson) vaccine requires a single dose.
Of the 875,707 individuals at least partially vaccinated, 489,703 were military servicemembers,
comprising about 23 percent of the eligible military servicemembers in all phases. DHA oﬃcials
stated that the winter holidays and weather temporarily slowed administration eﬀorts in the ﬁrst
month after vaccinations began (mid-December 2020 through mid-January 2021). The pace has
generally improved through March 2021.
Each DOD vaccination site may begin vaccinating individuals in lower tier phases at a diﬀerent
date due to diﬀerences in the proportion of individuals who are available within each phase at
each location, according to DHA oﬃcials.
The DHA Director monitors vaccine plan implementation on a daily basis, including allotment,
distribution, and administration, broken out by vaccine manufacturer, dose (initial and second),
category of eligibility (e.g., service component, contractors, civilian employees, and other
beneﬁciaries), and location. The Director also receives updates on public aﬀairs activities,
new information from the Centers for Disease Control and Prevention, and relevant clinical
considerations, such as any adverse eﬀects in DOD vaccine recipients reported to the Vaccine
Page 124
GAO-21-387

Adverse Event Reporting System (a national vaccine safety surveillance system overseen by the
Centers for Disease Control and Prevention and FDA).
Challenges and lessons learned. DOD oﬃcials have identiﬁed a number of challenges to the
eﬃcient and timely vaccination of workforce personnel and dependents of servicemembers, and
have taken corresponding corrective actions to address them.
Predictability of supply levels. According to DHA oﬃcials, during the ﬁrst weeks of distribution in
December 2020, some vaccine shipments arrived at receiving facilities unexpectedly and without
tracking numbers from the Army Medical Materiel Agency. As a result, DHA oﬃcials stated that
staﬀ at vaccination sites became concerned about supply levels and initially held back doses from
the initial shipments to conserve supply for second doses, rather than using them to administer
ﬁrst doses to other eligible personnel. Army oﬃcials stated that Pﬁzer had shipped vaccines
to some locations during those initial weeks before providing tracking numbers, resulting in
deliveries occurring before the Army Medical Materiel Agency could notify those sites. DHA
oﬃcials communicated the concerns to the Army Medical Materiel Agency to improve distribution
and they continue to monitor progress as shipments increase. For example, according to oﬃcials
from the Army Medical Materiel Agency, they have since participated in DHA’s Operational
Planning Team for vaccine distribution and administration, and have briefed the DHA Director on a
daily basis. They stated that all vaccines have been delivered on time and without any losses.
Vaccine conﬁdence. DOD encourages but does not require military servicemembers to receive
a COVID-19 vaccine authorized for emergency use.174 Senior DOD leaders and DHA oﬃcials
emphasized to us that communication and transparency with their eligible population are
paramount to increasing vaccine conﬁdence. In particular, they stated that education about
the beneﬁts and low risk of the FDA-authorized COVID-19 vaccines is critical to expanding the
vaccination campaign and thereby protecting the health of individuals. To these ends, DOD has
implemented a public aﬀairs campaign with approaches such as public service announcement
videos to address topics of concern, a video message from the Secretary of Defense, updates to
websites, social media, press releases and brieﬁngs, and media round tables. Senior DOD leaders
and military health professionals were among the ﬁrst to receive the vaccines after their FDA
authorizations, which they promoted with media events.
According to senior DOD leaders, they believe that continuing to promote conﬁdence in the FDA-
authorized COVID-19 vaccines will help address some degree of hesitancy that may exist among
military servicemembers just as with the general population. To that end, DOD leaders have used
the term “vaccine acceptance” to categorize the proportion of the military servicemembers who
received a vaccine compared with those eligible to receive it. However, “acceptance” suggests
that individuals not counted in the ratio have actively declined or resisted vaccination, while there
could be other reasons that they have not yet received a vaccine, such as insuﬃcient supply in a
certain location or because they were traveling or were on leave at the time they could have been
vaccinated.
174Federal law states that a vaccine released under an emergency use authorization cannot be made mandatory. 21
U.S.C. § 360bbb-3(e)(1)(A)(ii)(III).
Page 125
GAO-21-387

DOD oﬃcials stated that as long as the demand for vaccines exceeds available supply (projected
to be the case through late spring or summer of 2021), they cannot reliably determine how many
military servicemembers or others may have delayed vaccination or do not plan to be vaccinated.
Individuals who show up for an appointment at a DOD vaccination site and decide not to request
the vaccine after reviewing educational material are asked to record their decision on DHA Form
207–“COVID-19 Screening and Immunization Document.” However, DHA oﬃcials noted that this
decision reﬂects a single point in time, and the individual may choose to receive the vaccine at a
later date. Meanwhile, DHA oﬃcials stated that they are monitoring demographic trends among
DOD vaccine recipients, and when supplies increase to meet or exceed demand, they expect to
learn more about personnel who may have postponed or declined COVID-19 vaccination.
DOD oﬃcials involved in the vaccine distribution and administration process have been
documenting lessons learned and sharing them among DOD vaccination sites, other federal
agencies, and select foreign collaborators. For example, according to DHA oﬃcials, on the basis
of lessons learned, they expedited procedures by having staﬀ prepare paperwork and ﬁll vaccine
syringes from vials prior to the arrival of the individuals to be vaccinated. In addition, oﬃcials
have found that using large facilities, such as gymnasiums and warehouses, makes it possible
to administer vaccines to large numbers of individuals and observe them post-vaccination while
adhering to social distancing requirements.
Agency Comments
We provided a draft of this enclosure to DOD and the Oﬃce of Management and Budget
for review and comment. DOD provided technical comments on this enclosure, which we
incorporated as appropriate. The Oﬃce of Management and Budget did not provide comments on
this enclosure.
Methodology
To conduct this work, we reviewed DOD guidance and the most recent DOD data available as of
March 2021 on COVID-19 cases and vaccines. We obtained COVID-19 case data from defense.gov/
explore/spotlight/coronavirus and vaccine data from DHA. To assess the reliability of the data, we
discussed them with agency oﬃcials, reviewed them for outliers or obvious errors, and reviewed
relevant DOD documents. We determined that they were suﬃciently reliable for the purposes of
this enclosure but did not independently review them for accuracy.
We also interviewed DOD oﬃcials knowledgeable about COVID-19 vaccination eﬀorts and
reviewed publicly available DOD media reports, statements, and documents.
Contact information: Brenda S. Farrell, (202) 512-3604, farrellb@gao.gov
Page 126
GAO-21-387

Defense Support of Civil Authorities
As COVID-19 cases have surged across the country in late 2020 and into early 2021, requests for
the Department of Defense to provide personnel to support civil authorities have increased and
focused on specialties, such as critical care nurses.
Entities involved: Department of Defense; Federal Emergency Management Agency, within the
Department of Homeland Security; and Department of Health and Human Services
Key Considerations and Future GAO Work
We plan to continue to monitor how the Department of Defense (DOD) will support vaccine
distribution and administration eﬀorts as part of its Defense Support of Civil Authorities mission
and the government-wide pandemic response.
Background
While DOD’s primary mission is to defend the nation, the department is often asked to play a
prominent role supporting civil authorities and must be prepared to provide rapid response when
called upon during disasters and declared emergencies (natural or man-made). DOD provides
such support through its Defense Support of Civil Authorities mission, and is authorized to do
so when requested by another federal agency, with approval from the Secretary of Defense, or
when directed by the President.175 DOD provides such support using federal military forces; DOD
civilians and contract personnel; and DOD component assets, to include the National Guard, the
U.S. Army Corps of Engineers, and the Defense Logistics Agency.
National Guard forces may provide support to civil authorities when ordered to active
duty—commonly referred to as Title 10 duty status. When ordered to active duty, National Guard
forces are funded and commanded by DOD. National Guard personnel may also be ordered to a
duty status pursuant to Title 32 U.S.C. § 502(f)—commonly referred to as Title 32 duty status—by
the President or Secretary of Defense and with the consent of the Governor. When operating in a
Title 32 duty status, National Guard forces are funded by DOD and commanded by the state. The
following ﬁgure shows the state and federal command relationship based on the National Guard’s
or other forces’ status in supporting civil authorities.
175Requesting agencies could include, for example, the Federal Emergency Management Agency (FEMA), the
Department of Health and Human Services (HHS), and the U.S. Department of Agriculture.
Page 127
GAO-21-387

State and Federal Command Relationship Regarding Defense Support of Civil Authorities
Congress appropriated approximately $1.5 billion through the CARES Act for Army and Air
National Guard personnel and operations expenses incurred to prevent, prepare for, and respond
to the coronavirus, domestically or internationally.176 The approximately $1.5 billion was required
to be obligated by September 30, 2020. According to USAspending.gov, as of November 30, 2020,
the National Guard had obligated about $153.0 million and spent about $91.7 million of that
appropriation from the Army and Air National Guards’ Personnel and Operation and Maintenance
accounts.177
Section 13001 of the CARES Act provided DOD with the authority to transfer amounts
appropriated to the department by the act to other applicable DOD appropriations for expenses
incurred in preventing, preparing for, or responding to COVID-19, including in support of other
federal departments and agencies, and state, local, and tribal governments.178 As we noted in our
September 2020 report, DOD oﬃcials stated that the total amounts appropriated to the National
Guard in the CARES Act could not be fully obligated before they expired on September 30, 2020.
Amounts appropriated to the National Guard are not available to support state-level response
activities. Moreover, National Guard support to the states for the COVID-19 response was
reimbursed by FEMA and the states. Speciﬁcally, the initial mission assignments for Title 32
National Guard support were issued with 100 percent of the cost of support reimbursed by
the federal government and no cost to the states. On August 3, 2020, the President issued
176Coronavirus Aid, Relief, and Economic Security (CARES) Act, Pub. L. No. 116-136, div. B, title III, 134 Stat. 281, 518 and
520 (March 27, 2020). DOD received about $10.5 billion under the act which, in addition to the approximately $1.5 billion
for the National Guard activities, included appropriations for the Defense Health Program, the defense working capital
funds, and the Oﬃce of the Inspector General, among other things. We discuss the funding provided to the Defense
Health Program for military health care in the Military Personnel Vaccinations enclosure.
177USAspending.gov, accessed on January 14, 2021.
178Coronavirus Aid, Relief, and Economic Security (CARES) Act, Pub. L. No. 116-136, div. B, title III, § 13001, 134 Stat. 281,
521 (March 27, 2020).
Page 128
GAO-21-387

memorandums extending the authorization of Title 32 status for National Guard troops
supporting the COVID-19 pandemic through December 31, 2020.179
Consequently, amounts appropriated in the CARES Act to the National Guard in support of the
states’ COVID-19 response for ﬁscal year 2020 were identiﬁed as available for transfer to other
DOD appropriations for COVID-19-related priority activities. By September 30, 2020, DOD had
transferred approximately $1.28 billion of the amounts appropriated to the Army and Air National
Guard through the CARES Act to other DOD appropriations for COVID-related expenses (see ﬁg.).
CARES Act Appropriations to the National Guard and Subsequent Transfers from the National Guard to Other
DOD Accounts, Fiscal Year 2020
aCoronavirus Aid, Relief, and Economic Security (CARES) Act, Pub. L. No. 116-136, div. B, title III, 134 Stat. 281, 518 and 520
(March 27, 2020).
According to a DOD Comptroller oﬃcial, the CARES Act amounts were transferred out of the
four National Guard accounts to other DOD appropriation accounts as part of the department’s
CARES Act reprogramming actions. The oﬃcial further stated that the National Guard amounts
were combined with other amounts identiﬁed for reprogramming and transferred to other
DOD appropriations for use on COVID-19 expenses. Our analysis of DOD reprogramming
documentation found that the department transferred amounts initially appropriated to Army and
Air National Guard accounts in the CARES Act to a number of other DOD appropriation accounts
(see table).
179The presidential memorandums extending authorization of Title 32 status also reduced the federal cost share from
100 percent to 75 percent from August 22, 2020, through December 31, 2020, with exceptions for a few states that
maintained the 100-percent federal cost share. As part of the new administration’s policy to combat and respond to
COVID-19 with the full capacity and capability of the federal government, a January 21, 2021, presidential memorandum
restored the 100-percent federal cost share for Governors’ use of the National Guard to respond to COVID-19 through
September 30, 2021.
Page 129
GAO-21-387

Department of Defense (DOD) Accounts That Received CARES Act Appropriations Transferred from National
Guard Accounts
National Guard account with CARES
Act amounts available for transfer
DOD appropriation receiving CARES Act amounts transferred from
National Guard accounts
Army National Guard
• National Guard Personnel, Army
• Operation and Maintenance, Army
National Guard
• Military Personnel, Army
• Military Personnel, Navy
• Military Personnel, Marine Corps
• Operation and Maintenance, Army
• Operation and Maintenance, Navy
• Other Procurement, Army
• Reserve Personnel, Marine Corps
• Research, Development, Test, and Evaluation, Army
Air National Guard
• National Guard Personnel, Air
Force
• Operation and Maintenance, Air
National Guard
• Military Personnel, Air Force
• Operation and Maintenance, Air Force
• Operation and Maintenance, Navy
• Operation and Maintenance, Navy Reserve
• Operation and Maintenance, Marine Corps
• Defense Working Capital Fund
Source: GAO analysis of Department of Defense (DOD) budget documents. I GAO-21-387
We reported on DOD’s reprograming actions in November 2020. According to a September 2020
DOD internal reprogramming action, $24.4 million was available for transfer from the Army
National Guard Personnel account to the Army Research, Development, Test, and Evaluation
account. The reprogramming action stated that the funds were needed to assess COVID-19 testing
capability for the Army force and would be used to evaluate the viability and reliability of two
COVID-19 testing systems in operational settings.
As another example, approximately $254.6 million of CARES Act amounts appropriated to the Air
National Guard Personnel account were transferred to three other accounts, speciﬁcally Air Force
Personnel ($157.8 million), Marine Corps Operation and Maintenance ($90.5 million), and Navy
Reserve Operation and Maintenance ($6.3 million) in July 2020. According to the department’s
internal reprogramming action document, the amounts transferred to the Marine Corps were
needed to support temporary camps and contract lodging to ensure social distancing and a safe
training environment for new recruits and oﬃcer candidates, among other things.180
180According to DOD, recruits and oﬃcer candidates are required to quarantine prior to starting and during training.
Page 130
GAO-21-387

Overview of Key Issues
DOD has faced increased demand for personnel to support civil authorities. According to
DOD oﬃcials, demand for the department’s support of civil authorities has continued to increase
as large portions of the country experienced surges in COVID-19 cases and the department
began supporting new missions, as discussed in more detail below. On January 22, 2021, the new
Secretary of Defense released a statement aﬃrming the department’s continued commitment to
aid the nation’s health care professionals.
DOD oﬃcials stated that from March 2020 through January 2021 the department received over
400 Federal Emergency Management Agency (FEMA) mission assignments and other requests
for DOD support. According to DOD oﬃcials, as of late February 2021, the department had active
mission assignments for active-duty personnel in 26 states and territories. For example, DOD
personnel were supporting civilian health care providers at medical facilities in California, Arizona,
Texas, and the Navajo Nation through February 2021.181 Subsequently, oﬃcials from DOD and
FEMA reported in February 2021 that additional assignments to support federally run vaccination
centers using DOD active-duty forces were underway.
In late January 2021, DOD oﬃcials told us that 391 DOD medical personnel were providing support
under FEMA mission assignments. However, that number increased signiﬁcantly in February 2021
as the department began deploying personnel for the vaccination center missions. As of February
28, 2021, approximately 3,700 DOD active-duty personnel were providing assistance to the states
under the COVID-19 response.182
In addition, the number of National Guard personnel supporting the COVID-19 pandemic response
has also increased, following a period of decreased need in the fall of 2020.183 Speciﬁcally, as of
February 28, 2021, approximately 29,000 National Guard members were activated to support the
COVID-19 response in all 50 states, 3 territories, and the District of Columbia. This total represents
an increase of approximately 12,000 National Guard members put on orders to support the
response since fall 2020; however, this is still below the peak of National Guard support provided
in spring 2020, when approximately 40,000 members were on orders. According to FEMA’s January
2021 COVID-19 Initial Assessment Report, the response to COVID-19 is the ﬁrst time Title 32 has
been authorized for National Guard support at this scale and is the largest number of mission
assignments ever issued for Title 32 support.184
181In January 2021, the Department of Health and Human Services requested that DOD medical personnel support a
medical facility in the Navajo Nation reservation. The DOD medical personnel worked alongside civilian and U.S. Public
Health Service Commissioned Corps health care providers to treat COVID-19 patients. According to DOD, the addition of
the DOD medical personnel allowed the medical facility to double the bed capacity in its intensive care unit.
182As of March 6, 2021, the department had identiﬁed more than 6,200 active-duty forces to support COVID-19
vaccination centers, although not all had been deployed as part of a team as of that date.
183In November 2020, we reported that as of September 30, 2020, more than 16,000 National Guard members
remained on orders in 43 states and three territories in support of the COVID-19 response.
184FEMA, Pandemic Response to Coronavirus Disease 2019 (COVID-19): Initial Assessment Report, FEMA Operations January
through September 2020 (January 2021).
Page 131
GAO-21-387

The ﬁgure below shows DOD personnel totals supporting civil authorities by month from March
2020 through February 2021.
Department of Defense (DOD) Personnel Supporting Civil Authorities’ COVID-19 Response, March 2020 through
February 2021
Note: Personnel totals are as of the end of each month.
DOD has received increased requests for specialized medical support. According to DOD
oﬃcials, as more has become known about COVID-19, the types of support requested of and
provided by DOD have changed and become more targeted. Oﬃcials stated that, as of January
2021, the states’ primary needs were for nurses, especially critical care nurses for intensive care
units.185 According to those oﬃcials, the need for more specialized medical support underscores
a notable shift away from the requests for more general medical capabilities in the spring of 2020
when little was known about the virus or its treatment and the requests for assistance were not
being evaluated all together.186 DOD oﬃcials also stated that the department had to balance
requests for critical care nurses to help ensure that suﬃcient numbers of this type of nurse was
available at its own medical treatment facilities to handle trauma cases, among other things.
Subsequently, in February 2021, DOD oﬃcials stated that the department’s COVID-19 support
eﬀorts was shifting from augmentation of local medical capabilities to establishing and supporting
federal vaccination sites in states, using both nonmedical and medical active-duty personnel. As
185According to DOD oﬃcials, about 75 percent of requests for DOD medical personnel have been for nurses and, of
those requests, 75 percent have been for critical care nurses.
186DOD oﬃcials stated that the Emergency Support Function #8 Council was established in the spring of 2020 to look
across all of the requests for assistance and includes representatives from DOD and the Department of Health and
Human Services, among other federal entities. Oﬃcials further stated that the council has managed the requests for
assistance to meet critical high-priority needs, while preserving limited capabilities to respond to the next need.
Page 132
GAO-21-387

part of this new line of eﬀort, FEMA requested as many as 50 Type 1 teams and as many as 50
Type 2 teams from DOD to support the vaccination sites.187
As of March 2, 2021, more than 2,200 military medical and support personnel were deployed in
teams to support the federal vaccine response to the COVID-19 pandemic.188 More speciﬁcally,
on February 16, 2021, the ﬁrst team of 222 U.S. military personnel began supporting a Type 1
vaccination site at California State University, Los Angeles.189 The team—consisting of active-duty
Army personnel—was tasked with administering vaccinations and providing supervisory and
pharmacy support for the site through March 26, 2021 (see ﬁg.). According to a DOD oﬃcial, the
site is capable of administering up to 6,000 vaccinations a day. The department subsequently
deployed additional teams ranging in size from 25 servicemembers to 222 servicemembers
to locations in Florida, Georgia, Illinois, Michigan, New York, New Jersey, North Carolina, Ohio,
Pennsylvania, Texas, and the U.S. Virgin Islands in late February and March.190
Department of Defense Personnel Provide COVID-19 Vaccination Support in Los Angeles, California (March 2021)
According to DOD oﬃcials, a number of factors—such as access to and training on state-level
vaccination tracking systems and the overall supply of vaccine doses—had to be addressed before
DOD’s involvement in the vaccination eﬀorts could expand.
187According to FEMA’s Community Vaccination Centers Playbook, vaccination centers are classiﬁed based on facility
throughput over a 12-hour period. A Type 1 vaccination center has the approximate capacity to administer 6,000 doses
per day, while a Type 2 vaccination center is about half that size and has the approximate capacity to administer 3,000
doses per day. Additionally, the FEMA playbook identiﬁes Type 3 vaccination centers as having an approximate capacity
to administer 1,000 doses per day, while Type 4 and 5 vaccination centers can administer 250 doses per day. See FEMA,
Community Vaccination Centers Playbook (February 4, 2021).
188Type 1 teams consist of 222 personnel to support mega vaccination sites that can administer as many as 6,000
vaccinations per day, while the smaller Type 2 teams consist of 139 personnel to support smaller vaccination centers
that can administer 3,000 vaccinations per day.
189According to the FEMA Task Order associated with the California mission assignment, the team includes 15 command
and control personnel, 80 vaccinators, 15 registered nurses, 57 clinical staﬀ, and 55 general purpose staﬀ.
190Type 4 teams consist of 25 DOD personnel.
Page 133
GAO-21-387

National Guard support has shifted to align with the evolving vaccination-related needs of
the states, but members have continued to support broader COVID-19 missions.
According to the National Guard Bureau, demand for National Guard assistance is likely to
continue due to vaccine distribution, the strain on the health care system, and continued
unemployment. Throughout the surge in COVID-19 cases in late 2020 and early 2021, National
Guard members continued to provide support to a range of broad missions. However, with the
rollout and prioritization of vaccinations, National Guard members also began assisting civil
authorities in the distribution and administration of vaccines throughout the states. As of January
2021, 30 states were utilizing National Guard personnel to administer vaccines to the civilian
population.
National Guard members have continued to support the broader COVID-19 missions listed below.
• Testing and screening. National Guard members in 42 states have continued to support state
and local government testing and screening for COVID-19 cases, as of January 2021. For
example, in December 2020, the Mississippi National Guard administered COVID-19 testing in
communities and at long-term care and correctional facilities. This included staﬃng more than
34 drive-through testing sites per day in addition to providing personnel to serve as members
of outbreak response teams.
Mississippi National Guard Members Supporting COVID-19 Testing throughout the State in 2020
• Medical planning. National Guard members in 37 states have conducted medical planning,
as of January 2021. For example, in December 2020, Rhode Island National Guard members
worked with state agency partners to provide assistance in planning and coordination for the
distribution of the COVID-19 vaccine.
• Warehouse operations. National Guard members in 35 states have continued to perform tasks
related to storing and distributing supplies and equipment in warehouses, as of January 2021.
For example, in December 2020, Maine National Guard members conducted warehousing,
inventory, and distribution eﬀorts at Centers for Disease Control and Prevention receiving,
staging, and storage facilities, while Kansas National Guard members conducted coordination
eﬀorts with the state health department at a Topeka warehouse facility.
Page 134
GAO-21-387

• Other missions. Throughout the COVID-19 pandemic response, National Guard members in
a range of states have supported local long-term care facilities; assisted health departments
with contact tracing and mapping; distributed personal protective equipment; collected
COVID-19 specimens; and supported food banks by collecting and distributing food and
supplies, among other things.
Agency Comments
We provided a draft of this enclosure to DOD and the Oﬃce of Management and Budget
for review and comment. DOD provided technical comments on this enclosure, which we
incorporated as appropriate. The Oﬃce of Management and Budget did not provide any
comments on this enclosure.
Methodology
To conduct this work, we reviewed DOD documentation and the most recent information available
as of March 2, 2021. We also interviewed DOD oﬃcials knowledgeable about COVID-19 response
eﬀorts. The data were provided to us by the DOD COVID-19 Task Force, which maintains the
COVID-19 data of record for the department and reports them to senior DOD leaders. While
we did not independently verify the accuracy of the data, we assessed the reliability of the data
provided to us by checking for obvious errors or outliers, discussing the ongoing levels of DOD
personnel support with knowledgeable DOD oﬃcials, and reviewing relevant documentation.
We determined that the data were suﬃciently reliable for the purposes of reporting the levels
of personnel support provided by DOD. We also reviewed spending data from USAspending.gov
through November 30, 2020.
Contact information: Diana Maurer, (202) 512-9627, maurerd@gao.gov
Page 135
GAO-21-387

HHS COVID-19 Funding
As of February 28, 2021, the Department of Health and Human Services reported that it had
obligated about $232 billion and expended about $148 billion of the approximately $324 billion
in COVID-19 relief funds appropriated in the ﬁve COVID-19 relief laws enacted as of January 1,
2021—about 72 percent and 46 percent, respectively.
Entity involved: Department of Health and Human Services
Key Considerations and Future GAO Work
We will continue to examine the Department of Health and Human Services’ (HHS) use of
COVID-19 relief appropriations contained in COVID-19 relief laws enacted to help fund the
COVID-19 response, including appropriations in the American Rescue Plan Act of 2021, a sixth
COVID-19 relief law enacted on March 11, 2021.
Background
HHS received approximately $324 billion in COVID-19 relief appropriations from the ﬁve COVID-19
relief laws enacted as of January 1, 2021, to assist the response to COVID-19 (see table below).191
191Consolidated Appropriations Act, 2021, Pub. L. No. 116-260, 134 Stat. 1182 (2020); Paycheck Protection Program and
Health Care Enhancement Act, Pub. L. No. 116-139, 134 Stat. 620 (2020); CARES Act, Pub. L. No. 116-136, 134 Stat. 281
(2020); Families First Coronavirus Response Act, Pub. L. No. 116-127, 134 Stat. 178 (2020); Coronavirus Preparedness and
Response Supplemental Appropriations Act, 2020, Pub. L. No. 116-123, 134 Stat. 146 (2020).
Page 136
GAO-21-387

Appropriations to HHS for COVID-19 Response from the Five COVID-19 Relief Laws Enacted as of January 1, 2021
Legislation
Appropriations
($ millions)
Coronavirus Preparedness and Response Supplemental
Appropriations Act, 2020 (Pub. L. No. 116-123)
6,497.0
Families First Coronavirus Response Act (Pub. L. No. 116-127)
1,314.0
CARES Act (Pub. L. No. 116-136)
142,833.4
Paycheck Protection Program and Health Care Enhancement Act
(Pub. L. No. 116-139)
100,000.0
Consolidated Appropriations Act, 2021 (Pub. L. No. 116-260) a
73,175.0
Total
323,819.4
Source: Department of Health and Human Services (HHS) data. | GAO-21-387
Note: The Department of Health and Human Services (HHS) reported that, of its total appropriations for COVID-19 relief, the
agency transferred $289 million to the Department of Homeland Security, and $300 million are not available until HHS has
taken certain actions.
aThis amount reﬂects appropriations provided in Divisions M and N of the Consolidated Appropriations Act, 2021 that are
speciﬁcally designated for COVID-19 relief. An additional $638 million in COVID-19 relief funds were appropriated under
Division H to the Administration for Children and Families, an agency within HHS, to prevent, prepare for, and respond to
the coronavirus, for necessary expenses for grants to carry out a Low-Income Household Drinking Water and Wastewater
Emergency Assistance Program. However, these funds were not included in the HHS-reported data on HHS COVID-19
relief appropriations, obligations, and expenditures, as HHS noted that it is not considered COVID-19 relief funding for
USAspending.gov reporting purposes.
Overview of Key Issues
As of February 28, 2021, of the approximately $324 billion in COVID-19 relief funds appropriated,
HHS reported that it had obligated about $232 billion and expended about $148 billion—about 72
percent and 46 percent, respectively (see ﬁgure below).
Page 137
GAO-21-387

HHS’s Reported COVID-19 Relief Appropriations, Obligations, and Expenditures from COVID-19 Relief Laws, as of
February 28, 2021
Note: These amounts reﬂect appropriations provided in Divisions M and N of the Consolidated Appropriations Act, 2021 that
are speciﬁcally designated for COVID-19 relief.
In the following table, we list HHS appropriations, obligations, and expenditures by HHS agency
that HHS reported as of February 28, 2021, from the ﬁve COVID-19 relief laws enacted as of
January 1, 2021.
Page 138
GAO-21-387

Department of Health and Human Services-Reported COVID-19 Relief Appropriations, Obligations, and
Expenditures from Five COVID-19 Relief Laws, by Agency or Key Fund, as of February 28, 2021
Agency or key fund
Appropriations
($ millions)
Obligations
($ millions)
Expenditures
($ millions)
Administration for Children and Families
16,524.0
16,117.5
3,517.7
Administration for Community Living
1,480.0
1,380.0
801.3
Agency for Toxic Substances and Disease Registry
12.5
12.4
4.1
Centers for Disease Control and Prevention (CDC)
15,250.0
7,175.1
1,682.4
Centers for Medicare & Medicaid Servicesa
200.0
119.9
35.1
Food and Drug Administration (FDA)
196.0
45.5
20.8
Health Resources and Services Administration (HSRA)
1,320.0
1,319.4
998.3
Indian Health Service (IHS)
1,096.0
779.3
690.7
National Institutes of Health (NIH)
3,031.4
981.7
335.5
Public Health and Social Services Emergency Fund (PHSSEF)b
280,034.5
203,086.0
139,564.6
Oﬃce of the Assistant Secretary for Preparedness and Response c
15,695.1
10,507.8
6,436.4
Biomedical Advanced Research and Development Authority c
37,470.4
24,131.8
4,242.0
Provider Relief Fund c
178,000.0
128,601.4
120,151.7
Testing for uninsured c
2,000.0
1,968.8
1,967.2
CDC c
1,000.0
393.2
181.4
FDA c
22.0
0.4
0.3
HRSA c
979.8
971.4
617.4
IHS c
790.0
18.7
0.0
NIH c
1,806.0
1,011.6
351.0
Oﬃce of Inspector General c
12.0
2.7
2.4
Other PHSSEF c
42,259.2
35,478.2
5,614.8
Substance Abuse and Mental Health Services Administration
4,675.0
1,109.0
85.6
Grand Total
323,819.4
232,125.8
147,736.1
Page 139
GAO-21-387

Source: Department of Health and Human Service (HHS) data. | GAO-21-387
Note: HHS reported that of the total COVID-19 relief appropriations the agency transferred $289 million to the Department of
Homeland Security, and that $300 million in appropriations are not available until HHS takes certain actions. HHS’s reported
appropriations speciﬁcally designated for COVID-19 relief in the Consolidated Appropriations Act, 2021 (Pub. L. No. 116-260)
reﬂect only appropriations provided under Divisions M and N.
aThese amounts do not reﬂect Medicaid and Medicare expenditures. As of February 28, 2021, COVID-19-related federal
Medicaid expenditures totaled approximately $33 billion, or 7 percent of total federal spending on Medicaid services for January
2020 through February 2021. In addition, the Congressional Budget Oﬃce estimated that some provisions of COVID-19 relief
laws would aﬀect Medicare payments. For example, the Congressional Budget Oﬃce estimated that provisions in Division N of
the Consolidated Appropriations Act, 2021 will increase Medicare payments to providers by about $6 billion in 2021 through
2022.
bPHSSEF is an account though which funding is provided to certain HHS oﬃces, such as the Oﬃce of the Assistant Secretary for
Preparedness and Response. Amounts have been appropriated to this fund for the COVID-19 response to support certain HHS
agencies and response activities. For example, NIH received about $1.8 billion in transfers from the PHSSEF, and this amount is
not included in the approximately $3 billion appropriated directly to NIH.
cThe italicized amounts are subtotals of the PHSSEF and are already reﬂected in the total 280,034.5 billion listed for the PHSSEF.
Italicized amounts listed under the PHSSEF appropriations column are HHS allocations based on appropriations made in the
COVID-19 relief laws, and approved allotment decisions made by HHS in coordination with the Oﬃce of Management and
Budget. Some amounts were appropriated to the PHSSEF for transfer to speciﬁed HHS agencies. The Provider Relief Fund
reimburses eligible health care providers for health care-related expenses or lost revenues that are attributable to COVID-19.
Provider Relief Fund expenditures also may be referred to as disbursements.
HHS reported allocations, obligations, and expenditures of appropriations from the ﬁve COVID-19
relief laws for a variety of COVID-19 response activities, including activities to support testing, the
development of vaccines or therapeutics, and the acquisition of critical supplies. Across these
activities, the percentage of allocated funds that had been expended as of February 28, 2021,
ranged from about 98 percent for testing for the uninsured to about 9 percent for support to
state, local, territorial, and tribal organizations, which includes, in part, recent allocations from the
ﬁfth COVID-19 relief law, enacted on December 27, 2020.
The following table provides HHS’s reported allocations, obligations, and expenditures by selected
key response activity.
Page 140
GAO-21-387

Department of Health and Human Services-Reported Allocations, Obligations, and Expenditures of COVID-19
Relief Funds from ﬁve COVID-19 Relief Laws, by Selected Key Response Activity, as of February 28, 2021
Key response activity
Allocations
($ millions)
Obligations
($ millions)
Expenditures
($ millions)
Health centersa
2,020.0
2,018.1
1,439.7
Head Start
1,000.0
744.5
352.6
Provider Relief Fundb
178,000.0
128,601.4
120,151.7
Testing for uninsured
2,000.0
1,968.8
1,967.2
Support to state, local, territorial, and tribal organizations for
preparedness
37,392.1
35,529.5
3,442.3
Strategic National Stockpile
13,919.9
8,986.4
5,232.2
Telehealth
167.5
48.2
16.2
Testing
12,084.0
5,396.5
3,095.1
Vaccines
23,410.1
16,973.2
2,932.3
Drugs and therapeutics
7,628.4
7,014.2
1,246.0
Diagnostics research and development
3,100.6
1,569.9
474.2
Global disease detection and emergency response
800.0
306.3
84.3
Other response activitiesc
42,296.8
22,968.8
7,302.3
Total
323,819.4
232,125.8
147,736.1
Source: Department of Health and Human Services (HHS) data. | GAO-21-387
Notes: The selected response activities represent examples of certain targeted activities that fall within particular HHS agencies,
such as funding for health centers or Head Start, as well as broader categories of response activities that may span HHS
agencies, such as testing-, vaccine-, and therapeutics-related response activities. HHS reported allocations, obligations,
and expenditures for these activities based on the primary programmatic recipient organization of the funds, although
some activities apply to multiple categories. For example, certain funds in the “support to state, local, territorial, and tribal
organizations for preparedness” category were provided for testing but are not reﬂected in the “testing” category. According
to HHS oﬃcials, the allocations reported for the key activities above are based on amounts appropriated for these activities in
the COVID-19 relief laws, and on approved allotment decisions made by HHS in coordination with the Oﬃce of Management
and Budget. With respect to the Consolidated Appropriations Act, 2021, the amounts reﬂect only appropriations speciﬁcally
designated for COVID-19 in Divisions M and N of the act.
aHealth centers provide a comprehensive set of primary and preventative health care services to individuals regardless of their
ability to pay. Approximately $17 million of this funding is for Health Center Program look-alikes, which are centers that do not
receive Health Center Program funding but meet program requirements.
bThe Provider Relief Fund reimburses eligible health care providers for health care-related expenses or lost revenues that are
attributable to COVID-19. Provider Relief Fund expenditures may also be referred to as disbursements.
cAccording to HHS, other response activities include Centers for Disease Control and Prevention agency-wide activities and
program support; health care preparedness and response activities; and certain activities conducted by the National Institutes
of Health, among other activities.
Page 141
GAO-21-387

Agency Comments
We provided HHS and the Oﬃce of Management and Budget (OMB) with a draft of this enclosure.
HHS and OMB provided technical comments on this enclosure, which we incorporated as
appropriate.
Methodology
We requested, and HHS provided, data on appropriations, allocations, obligations, and
expenditures of COVID-19 relief funds by HHS agency and by key response activity, as of February
28, 2021. We also reviewed appropriation warrant information provided by the Department of the
Treasury as of January 31, 2021. To assess the reliability of the data reported by HHS, we reviewed
HHS documentation, Treasury appropriation warrant information, and information from the
federal spending database, USAspending.gov, as well as HHS’s spending database, taggs.hhs.gov,
and we determined that the HHS reported data were suﬃciently reliable for the purposes of our
reporting objective.192 We also reviewed the ﬁve COVID-19 relief laws enacted as of January 1,
2021, to assist the response to COVID-19.
Contact information: Carolyn L. Yocom, (202) 512-7114, yocomc@gao.gov
192We searched HHS’s Tracking Accountability in Government Grants System website and USAspending.gov—a publicly
available website developed and operated by the Department of the Treasury that includes detailed data on federal
spending, including obligations, across the federal government. See https://taggs.hhs.gov/coronavirus, accessed
3/1/2021, and https://USAspending.gov, accessed 3/4/2021. We did not independently validate the data provided by
HHS.
Page 142
GAO-21-387

Domestic Medical Product Manufacturing
Multiple federal agencies have eﬀorts to enhance domestic manufacturing of medical products in
response to the COVID-19 pandemic, and the federal government has recently initiated key steps
to coordinate these eﬀorts.
Entities involved: Department of Commerce, including the Bureau of Industry and Security and
National Institute of Standards and Technology; Department of Defense; Department of Health
and Human Services, including the Food and Drug Administration and the Oﬃce of the Assistant
Secretary for Preparedness and Response; Department of Homeland Security, including the
Federal Emergency Management Agency; Oﬃce of Management and Budget; U.S. International
Development Finance Corporation
Key Considerations and Future GAO Work
The COVID-19 pandemic has highlighted the need to ensure a resilient U.S. supply chain for all
medical products—drugs, biologics, and medical devices. One strategy to do so is to manufacture
more medical products in the U.S. Enhancing domestic manufacturing of medical products is
complex though, involving many diﬀerent types of supplies and coordination of multiple federal
agencies and the private sector.
In January 2021, we reported that the federal government had taken steps intended to create
resilient domestic drug supply chains. However, we found that federal agencies did not have
complete and accessible information to identify drug supply chain vulnerabilities or the
manufacturing sources of drugs and their components. We recommended that the Food and Drug
Administration (FDA) should obtain such information, including by working with manufacturers
and other federal agencies and, if needed, seek authority to do so. FDA said that it would consider
our recommendation as it continues eﬀorts to enhance relevant authorities and close data gaps.
The federal government instituted many eﬀorts to expand domestic production to respond to the
COVID-19 pandemic. However, the dynamic environment and the shifting of responsibilities, raises
questions about the federal government’s longer term plan for coordination and leadership.
The new administration took initial actions beginning in January 2021 to coordinate federal eﬀorts
to enhance domestic manufacturing, including directing federal agencies to develop a strategy for
a resilient medical product supply chain by July 2021. We will continue to monitor these and other
eﬀorts to create a more resilient supply chain.
Background
The manufacturing of medical products has become an increasingly global enterprise over
the past 30 years due in part to lower costs and fewer environmental regulations associated
with overseas production, and other incentives. In particular, manufacturers of certain medical
products, such as personal protective equipment (PPE) and generic drugs, have derived signiﬁcant
Page 143
GAO-21-387

cost savings by manufacturing their products outside the U.S, which may also beneﬁt consumers
through lower prices for products.193
The COVID-19 pandemic has further increased interest in enhancing domestic manufacturing, also
known as industrial base expansion, as demand and supply chain disruptions severely aﬀected
the availability of certain medical products, particularly PPE, that were coming from overseas. By
increasing the availability of medical products manufactured in the U.S., the federal government
hopes to strengthen national security by decreasing U.S. dependence on foreign sources, to
respond more quickly and eﬃciently during current and future emergencies, and ultimately
enhance the resiliency of the U.S. medical product supply chain.
However, the federal government faces many challenges with enhancing domestic manufacturing
capacity. For example:
• Industry associations have indicated that stringent environmental regulations, the cost and
time needed to build facilities, and acquiring knowledgeable staﬀ may serve as challenges to
medical product manufacturing in the U.S.
• Although federal purchasers are generally required to prioritize domestically manufactured
products, federal purchasing alone is not a suﬃcient incentive for manufacturers to
increase domestic production. Federal purchasers, such as the Department of Defense
(DOD) and Department of Veterans Aﬀairs (VA), make up about ﬁve percent of the U.S.
commercial market, according to oﬃcials from DOD and the Oﬃce of the Assistant Secretary
of Preparedness and Response (ASPR), within the Department of Health and Human Services
(HHS).
Overview of Key Issues
Federal eﬀorts to expand domestic production of medical products have increased in
response to the COVID-19 pandemic. Multiple federal agencies have eﬀorts, which include
funding domestic manufacturing capacity, procuring domestically manufactured medical products,
and promoting advanced manufacturing technology.
Funding domestic manufacturing capacity. The federal government has utilized CARES Act funding
and Defense Production Act (DPA) authorities to directly fund manufacturers to increase
production of PPE, drugs, and other medical supplies during the COVID-19 pandemic.194 For
example:
193PPE are clothing and equipment worn to shield the wearer from injury or exposure to hazardous or infectious
substances.
194CARES Act, Pub. L. No. 116-136, 134 Stat. 281 (2020); Defense Production Act, Pub. L. No. 81-774, 64 Stat. 798 (1950)
(codiﬁed, as amended, at 50 U.S.C. § 4501, et seq.). The Defense Production Act, as delegated, generally provides federal
agencies authority to, among other things, prioritize certain contracts over others. See, Exec. Order No. 13603, 77 Fed.
Reg. 16651 (Mar. 22, 2012); 15 C.F.R. pt. 700 (2020). For example, in times of national disasters, the President may invoke
the DPA to facilitate the supply and timely delivery of products by providing incentives to expand domestic production.
The DPA was authorized for use in response to the COVID-19 pandemic as early as March 2020.
Page 144
GAO-21-387

• DOD and HHS awarded about $2.3 billion to domestic manufacturers to increase production
of medical products, including PPE, drugs, and vaccine, ventilator, and testing materials, as
of February 2021. (See the Defense Production Act enclosure for more detailed information
about these awards.)
• The U.S. International Development Finance Corporation, under DPA authority delegated to
it, announced that it would award loans to U.S. private sector projects that supply resources
or strengthen relevant supply chains needed to respond to the COVID-19 pandemic.195 In
November 2020, for example, this agency conditionally approved a $590 million loan to ApiJect
to help build out infrastructure in North Carolina to package drugs and vaccines.
• ASPR, through the Biomedical Advanced Research and Development Authority (BARDA), also
made several awards to increase domestic production of medical products, including a May
2020 contract to Phlow Corporation for up to $812 million to manufacture drug ingredients
needed during the COVID-19 response and future public health emergencies.
Federal procurement of domestically produced medical supplies. Recent Executive Orders, which are
interrelated with existing federal acquisition requirements that preference U.S. made products,
have further directed federal agencies to maximize the purchase of domestically manufactured
goods.196
• In August 2020, the Executive Order on Combating Public Health Emergencies and Strengthening
National Security by Ensuring Essential Medicines, Medical Countermeasures, and Critical Inputs
Are Made in the United States directed federal agencies to develop procurement strategies to
purchase domestically sourced medical supplies and drugs.197 This Order encourages agencies
to take advantage of existing procurement authorities to limit competition, when permitted,
to maximize the procurement of essential medicines, medical countermeasures, and critical
inputs produced in the U.S.198
195DPA authority was granted to the U.S. International Development Finance Corporation through a May 2020
Executive Order Delegating Authority Under the Defense Production Act of 1950 to the Chief Executive Oﬃcer of the
United States International Development Finance Corporation to Respond to the COVID-19 Outbreak. Exec. Order No.
13922, 85 Fed. Reg. 30,583 (May 19, 2020). According to DOD, these loans will be supported through $100 million of
DPA funding appropriated under the CARES Act.
196Federal acquisition requirements include the Buy American Act, enacted in 1933, which requires federal procurement
of domestic products, including drugs, but permits federal agencies to procure foreign products under certain
exceptions, such as in cases in which domestic products are not reasonably available in suﬃcient quantities of a
satisfactory quality. Restrictions also may be waived under international trade agreements so that goods provided by
designated countries can compete on an equal footing with domestic products.
197Exec. Order No. 13944, 85 Fed. Reg. 49,929 (Aug. 14, 2020). The Executive Order considers an essential
medicine or medical countermeasure to be “produced in the U.S.” if the ﬁnished product and the critical inputs
used to produce it were, in turn, produced in the U.S. Critical inputs are active pharmaceutical ingredients, active
pharmaceutical ingredient starting materials, and other drug ingredients and device components that FDA
determines to be critical for assessing safety and eﬀectiveness of essential medicines and countermeasures.
198The Executive Order also directed Commerce to report on the status of the public health industrial base and
provide recommendations for initiatives to strengthen it. This report is directed to be completed by February 2021.
The Bureau of Industry and Security (BIS), within Commerce, expects to complete this report by March 31, 2021.
Page 145
GAO-21-387

• In January 2021, the Executive Order on Ensuring the Future Is Made in All of America by All of
America’s Workers directed the federal government to consider amendments to the Federal
Acquisition Regulation that would, among other things, increase the numerical threshold for
domestic content requirements, under the implementation of the Buy American Act.199 It
also directed federal agencies to report on implementation of and compliance with domestic
preference laws governing federal procurement, including the Buy American Act, and make
recommendations on maximizing the use of products made in the U.S.
Federal agencies’ promotion of advanced manufacturing in the U.S. Several federal agencies have
longstanding programs to promote technological advances in the domestic manufacturing of
drugs and medical countermeasures, including PPE. In some cases, these programs have also
assisted in the COVID-19 response.
• In 2012, HHS established the Centers for Innovation in Advanced Development and
Manufacturing to develop and manufacture medical countermeasures in the U.S.200 In January
2021, one of these centers announced that production had begun for two separate COVID-19
vaccine candidates in Texas.201
• Established in 2014, Manufacturing USA is a network of manufacturing institutes working with
participating federal agencies, including the Department of Commerce (Commerce), DOD,
and the Department of Energy. According to Commerce oﬃcials, each institute is a unique
public-private partnership jointly funded by government and private industry that promotes
U.S. advanced manufacturing through collaboration with private industry and academia. For
example, in May 2020, Commerce awarded $8.9 million to the National Institute for Innovation
in Manufacturing Biopharmaceuticals to, in part, identify reliable domestic supply chains for
the production of respirators and PPE, and build ﬂexible manufacturing capabilities that allow
for the quick scale-up in production of biologic therapies and essential medical products.
Additionally, America Makes, which is a DOD-sponsored Manufacturing USA institute,
partnered with FDA, VA, and the National Institutes of Health (NIH) to create an online forum
of manufacturers with 3D printing capabilities, designers willing to share 3D print designs,
and health care providers in need of PPE, according to the National Institute of Standards and
Technology (NIST), within Commerce. NIST oﬃcials explained that VA helps to test the designs,
which then may be reviewed by FDA. According to NIST, the manufacturing community used
validated models posted on the NIH 3D Print Exchange, with an estimated production of
millions of facemasks, face shields, and parts aligned to the needs of the supply chain crises.
• Also established in 2014, FDA’s Emerging Technology Program seeks to promote innovation
in drug manufacturing, such as through advanced manufacturing and continuous
199Exec. Order No. 14005, 86 Fed. Reg. 7475 (Jan. 28, 2021).
200Medical countermeasures are drugs, vaccines, and devices, such as personal protective equipment, used to
diagnose, treat, prevent, or mitigate harm from any chemical, biological, radiological, and nuclear agent.
201Press Announcement “Texas A&M System Subcontractor Begins Production of Two COVID-19 Vaccine
Candidates,” https://today.tamu.edu/2021/01/11/texas-am-system-subcontractor-begins-production-of-two-
covid-19-vaccine-candidates/ (Jan. 11, 2021, accessed February 17, 2021).
Page 146
GAO-21-387

manufacturing. In January 2021, FDA and NIST signed a memorandum of understanding to
collaborate on increasing resilience in the U.S. medical supply chain and advancing domestic
manufacturing of drugs and medical devices.
Recent federal actions aim to increase coordination of eﬀorts to enhance domestic medical
product manufacturing. In response to the COVID-19 pandemic, multiple federal actions were
initiated to coordinate eﬀorts to enhance domestic medical product manufacturing. (See ﬁgure
below.)
Selected Federal Entities Involved in the Coordination of Domestic Manufacturing Capacity Eﬀorts in Response
to the COVID-19 Pandemic
Page 147
GAO-21-387

• In March 2020, HHS established the Supply Chain Task Force, later renamed the Supply
Chain Advisory Group, which includes detailees from the Federal Emergency Management
Agency (FEMA) and DOD, according to Supply Chain Advisory Group oﬃcials.202 The Advisory
Group was established to maximize the nationwide availability of supplies needed for
the COVID-19 response. Supply Chain Advisory Group oﬃcials said the Advisory Group
assists ASPR with identifying targets for domestic production capacity for various medical
supplies. Since the Supply Chain Advisory Group does not have procurement authority, the
Defense Assisted Acquisition Cell, within DOD, awards funding to domestic manufacturers
to increase their production capacity, according to FEMA and ASPR oﬃcials.203 The Supply
Chain Advisory Group transitioned its responsibilities, including those related to enhancing
domestic manufacturing, to ASPR in late January 2021, according to ASPR and DOD oﬃcials.
Supply Chain Advisory Group oﬃcials said that they are continuing to assist ASPR with these
responsibilities and anticipate doing so through mid-March 2021.
In our September 2020 CARES Act report, we noted that DOD planned to transition their
contract management responsibilities, including awarding domestic production expansion
projects, to ASPR, within HHS, that month. In this report, we recommended that HHS, in
coordination with FEMA, should immediately document roles and responsibilities for supply
chain management functions transitioning to HHS. HHS disagreed, noting, among other things,
the work that the departments had done to manage the medical supply chain and increase
supply availability. We maintain the importance of this recommendation.
• Separately, beginning in June 2020, ASPR led another work group, which was focused on
modernizing the Strategic National Stockpile (SNS) and addressing supply chain vulnerabilities
for critical drugs and medical supplies, called the Logistics, Supply Chain, Next Generation SNS
Workgroup. This workgroup ended in September 2020, but ASPR’s work to expand domestic
manufacturing work stream continued, according to ASPR oﬃcials. (See our Strategic National
Stockpile and Medical Supply Chain enclosure for more details about the SNS).
In Fall 2020 ASPR drafted a national supply chain strategy that includes the goal of increasing
domestic manufacturing capabilities of medical countermeasures and PPE, referred to as
the “SNS 2.0 Strategy – Modernize the SNS.” ASPR oﬃcials acknowledged that some aspects
of the strategy are beyond its mission and that the agency would need to involve other HHS
components to implement it fully. Due to the change in administration in 2021, issuance of the
202Prior to June 2020, when it was renamed the Supply Chain Advisory Group, the Supply Chain Task Force was
the primary federal body coordinating and managing supply chain responsibilities, according to DOD oﬃcials.
In contrast to the Task Force, the Advisory Group has an advisory and assistance role, focused on transitioning
responsibilities to other federal stakeholders. The Supply Chain Task Force was one of eight task forces under the
Uniﬁed Coordination Group, which is led by the FEMA Administrator, the Assistant Secretary for Preparedness
and Response, and a representative of the Centers for Disease Control and Prevention, and responsible for the
operational command, leadership, and decision making for the COVID-19 pandemic response.
203In January 2021, FEMA released an initial assessment of their COVID-19 response from January through
September 2020, which found that there was not a consistent strategy or established guidance for coordinating
or communicating engagement with industry partners to expand domestic manufacturing. The lack of a strategic
nationwide approach to engage industry led to duplicate contracts and missed opportunities to expand domestic
manufacturing, according to the assessment. In response to this ﬁnding, FEMA recommended articulating a
long-term strategy for engaging industry partners and coordinating across the ﬁeld in future disaster responses.
Department of Homeland Security, Federal Emergency Management Agency, Pandemic Response to Coronavirus
Disease 2019 (COVID-19): Initial Assessment Report (January 2021).
Page 148
GAO-21-387

SNS 2.0 Strategy had been paused, according to oﬃcials, who noted that any ASPR strategy or
other coordination eﬀorts will align with the priorities outlined by the new administration.
In December 2020, the Supply Chain and Industrial Base Assurance Steering Committee
formed to continue ASPR’s work to expand domestic manufacturing. In particular, the Steering
Committee will establish ASPR’s long-term strategy for a resilient supply chain for medical
countermeasures, including by promoting domestic manufacturing. Additionally, ASPR plans
to combine these responsibilities with those that were transferred from the Supply Chain
Advisory Group. According to ASPR oﬃcials, ASPR also created an oﬃce focused on industrial
base expansion in January 2021.
• In September 2020, a White House task force on medical onshoring, which was led by the
Oﬃce of Trade and Manufacturing Policy, started to coordinate the federal government
approach to enhance domestic manufacturing, according to ASPR oﬃcials. The task force
focused on implementation of the provisions of the Executive Order on Combating Public
Health Emergencies and Strengthening National Security by Ensuring Essential Medicines, Medical
Countermeasures, and Critical Inputs Are Made in the U.S. across the federal government,
which included directing federal agencies to develop procurement strategies to increase
U.S. manufacturing of medical supplies, among other things. Oﬃcials said that the eﬀorts
included the key federal agencies mentioned in the Executive Order, including FDA, DOD, and
Commerce, but were unable to provide us with any additional details about the task force’s
activities. According to ASPR oﬃcials, this task force was disbanded in November 2020 due to
the change in administration.
Federal Coordination of Advanced Manufacturing
Federal coordination of advanced manufacturing was occurring prior to the COVID-19 pandemic. The America
COMPETES Reauthorization Act of 2010, as amended, mandates the coordination of federal programs and activities
that focus on advanced manufacturing programs, including those that pertain to enhancing domestic manufacturing.
Speciﬁcally, the Committee on Technology under the National Science and Technology Council within the Executive
Oﬃce of the President is responsible for planning and coordinating eﬀorts to expand advanced manufacturing in the
U.S., including for medical products. Members of the Council include the Department of Health and Human Services,
the Department of Defense, and the Department of Commerce, among others. In 2018, the Council released a strategic
plan, which included an objective to assure access to medical products through domestic manufacturing as part of its
eﬀorts to advance the technologies around medical product manufacturing.
Source: GAO analysis of 2018 report by the National Science and Technology Council and Pub. L. No. 111-358, 124 Stat.
3982 (2011) (codiﬁed in pertinent part, as amended, at 42 U.S.C. § 6622).| GAO-21-387
The new administration proposed additional actions to coordinate domestic manufacturing
eﬀorts for both the COVID-19 pandemic response and the longer term that may enhance federal
coordination eﬀorts beginning in late January 2021. Speciﬁcally, the White House
• created the position of COVID-19 Response Supply Coordinator who is tasked with
coordinating federal agencies involved in acquisition, supply, and expansion of domestic
manufacturing to ensure a sustainable pandemic supply chain.
Page 149
GAO-21-387

• issued an Executive Order on A Sustainable Public Health Supply Chain directing federal agencies
to present to the President a Pandemic Supply Chain Resilience Strategy.204 The Order directs
DOD, HHS, and the Department of Homeland Security (DHS), among others, to develop a
strategy to design, build, and sustain a long-term capability in the U.S. to manufacture supplies
for future pandemics and biological threats. According to ASPR oﬃcials, they have begun to
coordinate with HHS, DOD, and DHS to develop the strategy. The strategy is to be completed
by July 2021.
• issued an Executive Order on America’s Supply Chains directing speciﬁed federal agencies
to complete reports, including: (1) by June 2021, a review of supply chain risks and policy
recommendations addressing them, including for HHS to report on the risks for drugs and
active pharmaceutical ingredients; and (2) by February 2022, a report on the speciﬁed aspects
of the supply chain, including for HHS to report on the supply chains for the public health and
biological preparedness industrial base, such as by identifying the manufacturing or other
capabilities needed to produce critical medical products, and assessing U.S. manufacturing
capacity and gaps in domestic manufacturing capabilities.205 These reports are to complement
the ongoing work occurring for the A Sustainable Public Health Supply Chain Executive Order.
The Assistant to the President for National Security Aﬀairs and the Assistant to the President
for Economic Policy are to coordinate the various federal agencies’ response to this Executive
Order.
• issued an Executive Order on Ensuring the Future Is Made in All of America by All of America’s
Workers, which established the Made in America Oﬃce within the Oﬃce of Management and
Budget (OMB) to further the Administration’s policy to use federal awards and procurements
to maximize domestic manufacturing.206 OMB oﬃcials indicated that eﬀorts to implement the
Executive Order are underway, but the Made in America Director had not yet been appointed
as of February 2021. The oﬃce will assist the Director of OMB in reviewing and approving the
waivers that federal agencies use to purchase products based on exemptions from federal
acquisition regulations establishing a preference for domestic purchasing, including the Buy
American Act provisions.
Enhancing domestic manufacturing is a complex endeavor involving multiple federal agencies and
eﬀorts. Since the COVID-19 pandemic, the number of actions to enhance domestic manufacturing
has increased and some agency oﬃcials were unclear what entity, if any, was coordinating
these eﬀorts. In situations such as these, our key practices for interagency coordination, such as
clarifying leadership roles and responsibilities and outlining how leadership will be sustained over
the long term, may help ensure eﬀective implementation and reduce the potential for duplication,
overlap, and fragmentation. Several of the recent initial actions federal agencies are taking have
the potential to enhance coordination and align with our best practices, but these eﬀorts are all
still in the early stages of development and we will continue to monitor them in our future work.
204Exec. Order No.14001, 86 Fed. Reg. 7219 (Jan. 26, 2021).
205Exec. Order No. 14017, 86 Fed. Reg. 11849 (Mar. 1, 2021).
206Exec. Order No 14005, 86 Fed. Reg. 7475 (Jan. 28, 2021).
Page 150
GAO-21-387

Agency Comments
We provided a draft of this enclosure to HHS, DOD, DHS, Commerce, and OMB; none of the
agencies provided comments on this enclosure.
Methodology
To identify federal eﬀorts to enhance domestic manufacturing of medical products and the
coordination of such eﬀorts, we reviewed federal agency documents and plans. We also received
written responses and interviewed oﬃcials from ASPR, Commerce (Bureau of Industry and
Security and NIST), DOD, FEMA, FDA, OMB, and the U.S. International Development Finance
Corporation about their coordination of domestic manufacturing eﬀorts in response to the
COVID-19 pandemic and for advanced manufacturing.
Contact information: Mary Denigan-Macauley, (202) 512-7114, deniganmacauleym@gao.gov
Related Product
Managing for Results: Key Considerations for Implementing Interagency Collaborative Mechanisms.
GAO-12-1022. Washington D.C.: September 27, 2012.
Page 151
GAO-21-387

Emergency Use Authorizations for Medical Devices
During the COVID-19 pandemic, the Food and Drug Administration issued emergency use
authorizations to temporarily increase supply of certain medical devices, such as personal
protective equipment. Stakeholders—e.g., manufacturers and users of products with emergency
use authorization—have raised concerns about inconsistent guidance from agencies that outline
permissible use of these devices, and the timeline and process for transitioning away from such
devices as the pandemic ends.
Entities involved: Centers for Disease Control and Prevention and Food and Drug
Administration, within the Department of Health and Human Services; Occupational Safety and
Health Administration, within the Department of Labor
Recommendations for Executive Action
The Secretary of Health and Human Services should ensure that the Food and Drug
Administration and the Centers for Disease Control and Prevention work with the Assistant
Secretary of Labor for Occupational Safety and Health to develop a process for sharing
information to facilitate decision-making and guidance consistency related to devices with
emergency use authorization. The Department of Health and Human Services concurred with this
recommendation.
The Assistant Secretary of Labor for Occupational Safety and Health should work with the Food
and Drug Administration and the Centers for Disease Control and Prevention to develop a
process for sharing information to facilitate decision-making and guidance consistency related
to devices with emergency use authorization. The Department of Labor concurred with this
recommendation.
As the Food and Drug Administration develops a transition plan for devices with emergency
use authorizations, the Commissioner should specify a reasonable timeline and process for
transitioning authorized devices to clearance, approval, or appropriate disposition that takes into
account input from stakeholders. The Department of Health and Human Services concurred with
this recommendation.
Key Considerations and Future GAO Work
Emergency use authorizations (EUA) allow for the temporary use of unapproved medical products
when the Secretary of Health and Human Services declares circumstances exist to justify their
emergency use.207 These authorized medical products have been instrumental in increasing
needed supply of certain devices—such as personal protective equipment (PPE)—during the
COVID-19 pandemic response, according to Food and Drug Administration (FDA) oﬃcials and
stakeholder associations we interviewed. However, we identiﬁed instances of inconsistencies
between device use permitted by certain FDA EUAs and device guidance from the Centers for
Disease Control and Prevention (CDC) and the Occupational Safety and Health Administration
207See 21 U.S.C. § 360bbb-3.
Page 152
GAO-21-387

(OSHA). Such inconsistencies led to confusion and hesitancy among providers about using devices
with EUAs, according to provider association oﬃcials, and may have undermined the use of these
critical medical products early in the pandemic. Developing an interagency process for sharing
information would help to facilitate decision-making and guidance consistency.
Oﬃcials representing health care providers, device manufacturers, and distributors also raised
a number of concerns about what will happen to authorized devices after the declarations
permitting their use for COVID-19 end. A plan for devices with EUAs that speciﬁes a reasonable
timeline and process for transitioning away from their use, taking into account stakeholder
concerns, will help ensure a smooth transition.
In November 2020, we reported on FDA’s use of EUAs for other types of products for
COVID-19—speciﬁcally, EUAs for therapeutics to treat COVID-19 and vaccines to prevent the
disease. We recommended that FDA increase the transparency of its decisions related to EUAs for
these products. Since our report, FDA has taken action to address our recommendation and we
consider the recommendation closed.
We have additional ongoing work examining EUAs for COVID-19 diagnostic and antibody
tests. Therefore, this enclosure focuses on medical devices other than tests, including PPE,
decontamination systems, ventilators, infusion pumps, respiratory assistance devices, and remote
patient monitoring devices, among others.
Background
Medical devices used for COVID-19. Medical devices, such as PPE and ventilators, may be
necessary to provide medical care to patients during a pandemic such as COVID-19. See ﬁgure
below for examples of certain devices used during the COVID-19 pandemic.
Page 153
GAO-21-387

Examples of Medical Devices Used for COVID-19
Note: Tests are also devices used for detecting and diagnosing COVID-19; however, tests are outside the scope of this review.
Device marketing and EUA process. Generally, before a medical device can be marketed in the
U.S., it must be approved or cleared by FDA.208 While the amount of evidence required to meet the
applicable FDA standard varies by the level of risk the device poses to patients or users, high-risk
devices generally require FDA premarket review and approval to determine whether the device
meets the statutory standard of reasonable assurance of safety and eﬀectiveness for its intended
use. Moderate-risk and some lower-risk devices may require premarket notiﬁcation—also known
as 510(k) clearance.209
208Medical devices must also meet other requirements, such as establishment registration and device listing with FDA.
See 21 C.F.R. Part 807 (2020).
209For devices FDA determines are high risk, device sponsors must generally receive premarket approval from FDA.
For moderate- or some lower-risk devices, sponsors must generally receive 510(k) clearance from FDA, whereby they
demonstrate that the new device is substantially equivalent to a legally marketed predicate device. Certain low-risk
devices are exempt from the 510(k) clearance process, but the manufacturer must still register with FDA. See 21 U.S.C.
Page 154
GAO-21-387

The Secretary of Health and Human Services may declare that circumstances, prescribed by
statute, exist justifying the authorization of emergency use of certain medical products, including
devices.210 For COVID-19, the Secretary issued three declarations in February and March 2020
permitting FDA to authorize the emergency use of diﬀerent medical devices.211 Once an EUA
declaration has been made, FDA may temporarily authorize the emergency use of unapproved
medical products or unapproved uses of approved medical products through EUAs, provided
certain statutory criteria are met.212 Prior to the COVID-19 pandemic, FDA had issued EUAs for
certain respirators during the H1N1 pandemic.
Reissuing and revoking EUAs. FDA is required to periodically review the circumstances and
appropriateness of EUAs it has issued.213 FDA may revise an EUA—e.g., by reissuing the EUA
with changes—or revoke an EUA if the circumstances that led to the EUA declaration no longer
exist, the criteria for issuance are no longer met, or reissuance or revocation is appropriate to
protect public health or safety. For example, FDA may reissue an EUA if there is a material change
in the risk-beneﬁt assessment based on evolving understanding of the disease or condition or
availability of authorized devices. In general, an EUA will remain in eﬀect for the duration of the
EUA declaration unless revoked at an earlier date.
EUA declarations advanced notice. The Secretary of Health and Human Services is required
to provide advance notice that EUA declarations will be terminated and must consult with the
manufacturers of any authorized products regarding appropriate disposition of the products if
authorizations cease to be eﬀective due to termination of the declarations.214
Other agencies also responsible for ensuring safe and eﬀective use of certain devices, such
as PPE. CDC’s National Institute for Occupational Safety and Health (NIOSH) studies and makes
recommendations focused on worker safety and health. As part of this eﬀort, the agency provides
a testing, approval, and certiﬁcation program, assuring respirators used in the workplace meet
certain standards. For example, NIOSH-approved “N95” respirators are proven to ﬁlter at least
§§ 360(k), 360c, and 360e. Novel devices that are low to moderate risk but are not substantially equivalent to a legally
marketed predicate device may be authorized through the De Novo classiﬁcation process. See 21 U.S.C. § 360c(f)(2).
210See 21 U.S.C. § 360bbb-3(b)(1).
211The Secretary of Health and Human Services issued three EUA declarations for medical devices for COVID-19—on
February 4, 2020, regarding in-vitro diagnostic devices for detection or diagnosis of COVID-19; on March 2, 2020, related
to personal respiratory protective devices for COVID-19; and on March 24, 2020, for medical devices including alternative
products used as medical devices during the COVID-19 pandemic (such as systems to decontaminate N95 respirators for
reuse by healthcare personnel).
212Among other statutory criteria, the threat must be capable of causing a serious or life-threatening disease or
condition, and it must be reasonable to believe, based on the totality of scientiﬁc evidence available, that the product
may be eﬀective in diagnosing, treating, or preventing the disease or condition and that the known and potential
beneﬁts of the product outweigh the known and potential risks. In addition, there must be no adequate, approved, and
available alternatives to the product. 21 U.S.C. § 360bbb-3(c).
21321 U.S.C. § 360bbb-3(g)(1).
214The period of advance notice must be suﬃcient to allow for disposition of authorized products or disposition of the
product labeling (in the case of an unapproved use of an approved product). 21 U.S.C. § 360bbb-3(b). In addition, even
if the EUA declaration is terminated or an EUA is revoked, an authorization will continue to be eﬀective to provide for
continued use of an unapproved product for patients to whom it was administered during the emergency period, if
found necessary by the patient’s physician. 21 U.S.C. § 360bbb-3(f)(2).
Page 155
GAO-21-387

95 percent of airborne particles.215 In response to the COVID-19 pandemic, CDC released crisis
capacity strategies with recommendations for optimizing supplies of PPE, such as limited re-use of
respirators or use of non-NIOSH approved respirators when alternatives are not available.
The Department of Labor’s (DOL) OSHA helps ensure safe and healthy conditions for workers by
setting mandatory workplace safety and health standards and conducting inspections to enforce
those standards.216 One such standard requires that employers provide respirators to employees
exposed to certain respiratory hazards, and take steps to ensure their proper use, including by
using NIOSH approved respirators. In response to the COVID-19 pandemic, OSHA has issued
industry-speciﬁc voluntary guidance for employers on COVID-19-related precautions, as well as
other actions.
Overview of Key Issues
EUAs issued, reissued, and revoked for medical devices during COVID-19. FDA has issued
55 EUAs for medical devices since March 2020, as of March 10, 2021. These include 46 EUAs
for individual devices as well as nine umbrella EUAs—a new EUA approach FDA developed for
COVID-19 that authorizes certain classes of devices for emergency use rather than individual
models.217 As part of FDA’s periodic reviews of EUAs, the agency has reissued 16 of these 55 EUAs
issued since March 2020 and revoked three of them.
EUAs for individual devices. As of March 10, 2021 FDA has issued 46 EUAs for COVID-19 for
individual devices, each covering a speciﬁc product. It has revoked one EUA for these devices and
reissued 12 of them. See table for the number of EUAs issued and reissued by individual medical
device type.
215See 42 C.F.R. § 84.170(a)(3)(iii) (2019). Other countries also regulate and test masks and respirators. For example,
“KN95” respirators are determined by the Chinese government to ﬁlter at least 95 percent of airborne particles.
216OSHA carries out these activities under the Occupational Safety and Health Act of 1970 (OSH Act), Pub. L. No.
91-596, 84 Stat. 1590 (codiﬁed, as amended, at 29 U.S.C. § 651 et seq.). Under the OSH Act, states, territories, and
other jurisdictions can be approved by OSHA to set and enforce their own workplace safety and health standards,
which must be at least as eﬀective as the federal standards. There are currently 22 State Plans—programs through
which jurisdictions set and enforce their own standards—covering both private sector and state and local government
workers, and there are six State Plans covering only state and local government workers. Federal OSHA still enforces
federal workplace safety and health standards for private employers in the six State Plans that cover only state and local
government workers.
217FDA also issued EUAs for various COVID-19 tests. These EUAs are not included in this review; we have ongoing work
to examine EUAs for tests.
Page 156
GAO-21-387

Number of Emergency Use Authorizations (EUA) Issued and Reissued for Individual Devices by Device Category
for COVID-19, as of March 10, 2021
Device category
Number of EUAs
Number of EUAs reissued
a
Number of EUAs revoked
Personal protective
equipment (PPE)
6
1
0
Decontamination systems for
PPE
15
10
1
Remote patient monitoringb
5
0
0
Respiratory assistance
5
0
0
Blood puriﬁcation
4
0
0
Continuous renal replacement
therapy and hemodialysis
3
0
0
Infusion pumps
1
0
0
Other devicesc
7
1
0
Total
46
12
1
Source: GAO analysis of data from the Food and Drug Administration’s (FDA) website and information obtained from agency oﬃcials. | GAO-21-387
Note: We reviewed documentation made publicly available by FDA, including authorization and reissuance letters and
information on FDA’s website, to determine the information in this table.
aSome EUAs were reissued multiple times while others were reissued once. The count in this column reﬂects the number of
EUAs FDA reissued at least once.
bFDA’s website lists six EUAs under this category. However, one Patient Isolation Treatment Unit EUA is identical to an EUA
found under the PPE category. To avoid duplication, this EUA is only counted once under the PPE category due to its primary
use as a protective barrier.
cOther medical devices consist of devices that provide life support to severely ill patients through external oxygenation (e.g.,
artiﬁcial lung and heart devices), conduct predictive screening for providers to anticipate which patients in intensive care units
will be likely to experience low blood pressure or breathing diﬃculty, assist patients’ heart function through ventricular support
systems, and help reduce COVID-19 transmission (e.g., non-surgical face masks).
Our review of FDA’s EUA documentation indicates that the majority of reissued individual
EUAs were for decontamination units. This was primarily due to new information FDA received
regarding respirators rather than due to issues surrounding the decontamination units
themselves, according to FDA documentation. Speciﬁcally, FDA reissued certain decontamination
unit EUAs to identify the types of respirators these units can decontaminate and to reduce the
number of times a respirator could be decontaminated, among other things.
Page 157
GAO-21-387

Umbrella EUAs. Since March 2020, FDA has issued nine umbrella EUAs for PPE and other medical
devices.218 FDA ﬁrst used umbrella EUAs during the COVID-19 pandemic, allowing the agency to
authorize certain types of devices rather than individual products, according to FDA oﬃcials. These
nine umbrella EUAs covered at least 534 device models across at least 299 diﬀerent manufacturers
as of March 10, 2021, demonstrating how one umbrella EUA can expand access to many devices
(see table). FDA has reissued four of these umbrella EUAs at least once and revoked two since
March 2020.
218In addition to the nine umbrella EUAs, FDA also issued two umbrella EUAs for diagnostic tests for COVID-19. We will
examine EUAs for tests in separate ongoing work.
Page 158
GAO-21-387

Umbrella Emergency Use Authorizations (EUA), Reissuances, Revocations, and Number of Authorized
Manufacturers and Device Models for COVID-19, as of March 10, 2021
Device category for EUA
Number of
authorized
manufacturers per
each umbrella EUA
Number of
authorized models
per each umbrella
EUA
Number of times
EUA reissued
EUA revocations
Non-NIOSH approved KN95
respirators, manufactured in
China
167
256
3
0
Non-NIOSH approved N95
respirators, manufactured
outside of China
35
81
2
0
Surgical masks
17
34
0
0
Ventilators and ventilator
accessories
84
163
0
0
NIOSH approved N95
respiratorsa
Not available
Not available
2
0
Surgical gowns and other
apparela
Not available
Not available
0
0
Face shieldsa
Not available
Not available
1
0
Infusion pumpsb
0
0
0
1
Protective barrier enclosuresa
Not Available
Not Available
0
1
All devicesc
299
534
8
2
Source: GAO analysis of data from the Food and Drug Administration’s (FDA) website and information obtained from agency oﬃcials. | GAO-21-387
Note: We reviewed documentation made publicly available by FDA, including authorization, reissuance, and revocation letters
and information on FDA’s website. Each row in the table represents a single umbrella EUA.
aFDA did not require manufacturers to submit separate requests for models under these umbrella EUAs. Therefore, we cannot
determine the total number of authorized manufacturers and models.
bFDA authorized no manufacturers or infusion pump models prior to the EUA revocation.
cNumbers per EUA device category may not add up to the “all devices” total, as some manufacturers were authorized to
produce devices for several EUAs and would not have been counted more than once.
According to FDA, the agency revoked two umbrella EUAs—one for infusion pumps and one for
protective barrier enclosures—determining, among other things, that individualized consideration
of each EUA request for these devices would better protect the public health. In the case of the
umbrella EUA for infusion pumps, FDA authorized no manufacturers or infusion pump models
prior to the EUA revocation. FDA oﬃcials said they have learned several lessons about the
umbrella EUA process during the pandemic, which have included gaining a better understanding
of what device types are suited for umbrella EUAs.
Page 159
GAO-21-387

FDA reissued four umbrella EUAs at least once, three of which were umbrella EUAs for ﬁltering
facepiece respirators (respirators):
• The umbrella EUA for NIOSH approved respirators was reissued to expand the scope of
authorization beyond ﬁltering facepiece respirators to include other types of respirators,
as well as to include respirators that undergo decontamination with an FDA authorized
decontamination system.
• The umbrella EUA for non-NIOSH approved KN95 respirators manufactured in China was
reissued three times between April and October 2020 due to safety concerns, among other
reasons. According to FDA documents, FDA limited the scope of authorization for these
devices at several points in time based on new data that these respirators were not meeting
FDA standards. The ﬁnal reissuance in October 2020 was due to decreased demand in KN95
respirators within health care settings, resulting in FDA’s decision not to review any additional
EUA requests for this type of device.
• The umbrella EUA for non-NIOSH approved N95 respirators manufactured outside of China
was reissued twice to improve availability, as well as to address safety concerns. For example,
one reissuance allowed for the reuse of these respirators once decontaminated with an
authorized decontamination unit, according to FDA documents.
Beneﬁts of EUAs for devices during COVID-19. FDA oﬃcials and most stakeholder associations
we interviewed stated that the use of EUAs helped address critical medical device shortages.
According to FDA oﬃcials, EUAs are one of the key pathways to allow providers to gain access to
critical medical devices that have not received premarket approval or 510(k) clearance.
Oﬃcials from some health care provider associations told us that medical device EUAs—in
particular, those related to respirators—enabled providers to provide better care for COVID-19
patients and to protect themselves from infection. Association comments included:
• Respirator EUAs opened up a new supply that mitigated shortages seen at the beginning of
the pandemic, oﬃcials from one provider association told us. According to these oﬃcials,
hospitals would have been unable to respond to the pandemic without such EUAs.
• Remote patient monitoring devices authorized under EUAs allowed clinics to monitor patients
with chronic diseases who were unable to meet with providers in-person during the pandemic,
according to oﬃcials at another association.
In addition, oﬃcials from a device manufacturer association said that device EUAs enabled
the medical technology industry to mobilize quickly to support health care providers and their
patients. For example, FDA authorized the use of a decontamination system that could result
in 750,000 masks per day being decontaminated for re-use, if fully utilized, according to these
oﬃcials.
Coordination across FDA, CDC, and OSHA during current and future pandemics. FDA,
CDC, and OSHA each have a role in ensuring the proper use of respirators and systems used
Page 160
GAO-21-387

to decontaminate them. However, we identiﬁed some inconsistencies between device use
permitted by FDA’s EUAs for respirators and systems for their decontamination, and CDC and
OSHA guidance for such devices. For example
• FDA issued an EUA on March 2, 2020, to authorize use of NIOSH approved respirators past the
manufacturer’s recommended shelf life; however, OSHA did not issue guidance permitting
this until roughly a month later.219 Similarly, FDA reissued the EUA on March 28, 2020, to
permit the decontamination and reuse of certain respirators; however, OHSA did not release
guidance on this topic until April 24, 2020, nearly a month later.
• In October 2020, CDC recommended that respirators be reused no more than ﬁve times.
However, between March 2020 and January 2021, FDA guidance for certain EUAs for
decontamination systems authorized respirator decontamination and reuse up to 10 or 20
times. In January 2021, FDA reissued many decontamination system EUAs to limit the number
of cycles to no more than four, consistent with CDC’s recommendations.
FDA and CDC oﬃcials explained that guidance inconsistencies for decontamination arose in
part due to diﬀering perspectives on the number of times a respirator can safely be reused. For
example, while both agencies relied on scientiﬁc evidence to support their decisions, FDA’s EUA
decisions also took into account the agency’s goal to increase the available supply as much as
possible to meet demand. Both agencies said that inconsistencies could be minimized by better
information sharing.
According to some association oﬃcials we interviewed, the inconsistent guidance caused
confusion and hesitancy among providers about how these devices could be used. For example,
providers were reluctant to use devices with EUAs out of concern that doing so would conﬂict with
another agency’s standards. This potentially undermined the use of these critical devices in the
early stages of the pandemic.
FDA initiated webinars with CDC and OSHA in June 2020 to help address stakeholder questions;
however, oﬃcials from all three agencies acknowledged the importance of coordination and
information sharing to help address conﬂicts between EUAs and related guidance sooner.
Although oﬃcials from all three agencies noted that they have good informal relationships, there
is no documented process for sharing information.220 Such a lack of sharing between agencies
increases the risk of inconsistent decision-making and guidance related to devices with EUAs
during this pandemic or future emergencies. Our key practices for enhancing and sustaining
collaboration among federal agencies recommend that agencies should establish compatible
policies, procedures, and other means to operate across agency boundaries.
219For COVID-19, OSHA released temporary guidance regarding enforcement of the respirator standard.
OSHA released enforcement guidance on April 3, 2020, outlining enforcement discretion to permit the use of
respirators beyond the manufacturer’s recommended shelf life. OSHA released guidance on April 24, 2020 outlining
enforcement discretion related to reuse of respirators that have been decontaminated.
220FDA has a memorandum of understanding with CDC that is not speciﬁc to EUAs but does provide a framework for
certain information sharing, according to FDA oﬃcials. There is no similar MOU between FDA, CDC, and OSHA, according
to FDA oﬃcials.
Page 161
GAO-21-387

Developing a process for FDA, CDC, and OSHA to share EUA device information to facilitate
decision-making and guidance consistency, would help to mitigate confusion and hesitancy among
providers about using devices with EUAs. In turn, this would facilitate the realization of a key goal
of EUAs—to mitigate device shortages by expanding access to and use of such critical medical
supplies.
Transition from use of authorized devices after the relevant EUA declarations have been
terminated . Oﬃcials from manufacturer and distributor associations we spoke with said that, to
ensure a smooth transition after the EUA declarations have been terminated, it will be important
for FDA to specify a reasonable timeline and process for transitioning devices authorized for use
during the emergency to clearance, approval, or appropriate disposition.221 Association oﬃcials
made the following points:
• Manufacturers with authorized devices will require time to obtain FDA clearance or approval
to continue oﬀering their devices after the EUA declarations end, according to oﬃcials from
two associations. Depending on the level of risk associated with the devices, manufacturers
generally need to obtain 510(k) clearance or premarket approval to continue to market
authorized products after EUAs are no longer in eﬀect. However, lengthy delays in FDA’s
review of 510(k) submissions and lack of responsiveness about the status of submissions have
been reported by medical device manufacturer association oﬃcials. FDA oﬃcials stated that
510(k) review times were within their goals for devices used in response to the pandemic, but
explained that they have received a record number of EUA requests for COVID-19 and non-
COVID-19 related 510(k) submissions.
• Medical device distributors and manufacturers require a transition period to adjust supply
chain purchasing, such as overseas material purchasing, and distribution, according to oﬃcials
from two associations we interviewed. Distributors would be unlikely to be able to return—or
recoup losses associated with—previously authorized devices. Similarly, manufacturers are
not sure if they would need to immediately stop making and remove devices with EUAs from
the market, or if there were any circumstances in which FDA might permit use of authorized
devices after the EUA declarations end, according to association oﬃcials representing these
stakeholders. Manufacturer association oﬃcials said that a member manufacturer did not
pursue an EUA for a new device it had developed due to uncertainty about how the device
could be used after the EUA declaration ends.
• Frontline health care staﬀ lack conﬁdence in using some medical devices with EUAs because
such usage is not standard care, and are concerned that employers will continue to use crisis
capacity standards after the EUA declarations end, according to some provider associations.
FDA, OSHA, and CDC will play a role in ensuring that providers return to conventional
standards of care, for example, using only NIOSH approved respirators.
In addition to these association concerns, the Department of Health and Human Services (HHS)
purchased for the Strategic National Stockpile certain ventilator models and respirators with EUAs,
221EUAs remain in eﬀect until the EUA declaration under which the EUA was issued terminates or the EUA is revoked,
whichever is earlier. 21 U.S.C. § 360bbb-3(f)(1). At the time of our review, the Secretary had not indicated when the
relevant EUA declarations would terminate, according to FDA oﬃcials.
Page 162
GAO-21-387

according to the agency responsible for the federal stockpile. Further, some states have stockpiled
devices with EUAs, according to association oﬃcials representing states. As stockpiles are designed
to provide for the security of the nation during public health emergencies, it is important to
know how, and for how long, certain authorized devices may continue to be used after the EUA
declarations end.
The ECRI Institute—an organization that conducts independent medical device evaluations—has
similarly cautioned providers about the status of authorized products after the EUA declarations
end.222 For example, in an April 2020 alert, the ECRI Institute cautioned that hospitals should
seek clarity on the post-EUA declaration status of ventilators before purchasing them, and in a
May 2020 alert, it recommended that healthcare facilities consider the ﬁnancial implications of
purchasing devices with EUAs given that an EUA generally remains in eﬀect only during the EUA
declaration.223
The Secretary of Health and Human Services is required to provide notice prior to the termination
of the EUA declarations and consult with manufacturers about proper disposition of authorized
devices.224 In addition, FDA has indicated that it intends to develop draft guidance for a transition
plan for medical devices distributed under EUAs for COVID-19 by the end of the ﬁscal year 2021.
FDA oﬃcials told us the agency would publish the transition plan as draft guidance to receive
feedback from stakeholders and provide suﬃcient time before the EUA declarations end for
stakeholders to provide comments. FDA oﬃcials also noted that they intend for the transition
plan to describe a timeframe for manufacturers to obtain clearance or approval of their devices
before the EUA declarations terminate. Further, FDA oﬃcials stated the transition plan will include
a policy addressing authorized devices that have a pending premarket review submission but have
not yet been approved or cleared by the time the EUA declarations terminate.
However, in light of the ongoing pandemic, as of March 15, 2021, the agency had not released a
draft transition plan. As a result, important aspects of the transition plan for devices with EUAs
are unknown and remain to be determined, including the timeline and process for transitioning
authorized devices to full clearance, approval, or appropriate disposition and the extent to which
stakeholder feedback, including from CDC and OSHA, will be incorporated.
Specifying a reasonable timeline and process for transitioning authorized devices to clearance,
approval, or appropriate disposition that incorporates stakeholder input, before the EUA
declarations end, would be consistent with the PanCAP Adapted. The PanCAP Adapted is the
general operative plan for the federal response to COVID-19; it highlights the importance of clear
communication during a crisis.225 Further, it would be consistent with federal standards for control
222The ECRI Institute is designated an Evidence-based Practice Center by HHS’s Agency for Healthcare Research and
Quality and a federally certiﬁed HHS Patient Safety Organization. As part of its work, the ECRI Institute provides clinical
evidence to inform and support decisions on the eﬀectiveness of medical technologies and clinical practice guidelines.
223See ECRI Institute, Use of Unapproved Devices or New Applications for Existing Medical Devices to Address COVID-19
Shortages without an EUA May Jeopardize Patient or Staﬀ Safety (Plymouth Meeting, Penn.: May 15, , 2020) and ECRI
Institute, Ventilators on FDA Emergency Use Authorization List: Hospitals Should Seek Clarity on Post EUA Status Before
Purchasing (Plymouth Meeting, Penn.: April 29, 2020).
22421 U.S.C. § 360bbb-3(b)
225See Department of Health and Human Services, U.S. Government COVID-19 Response Plan (Mar. 13, 2020).
Page 163
GAO-21-387

activities, which emphasize that agencies should design and implement policies and procedures
to achieve their objectives—in this case, ensuring a smooth transition from use of authorized
devices.226
Further, taking such action would help to provide a smooth transition for manufacturers,
purchasers, and users of devices with EUAs. This is the agency’s opportunity to mitigate concerns
about approval or clearance time, use of stockpiled devices with EUAs, and eﬀorts by other federal
agencies to return to conventional standards of care, prior to the end of the EUA declarations.
Agency Comments
We provided HHS, DOL, and the Oﬃce of Management and Budget (OMB) with a draft of
this enclosure. HHS provided general comments, which are reproduced in Appendix VI:
Comments from the Department of Health and Human Services . HHS concurred with both of
our recommendations. Regarding our recommendation for FDA and CDC to work with OSHA to
develop a process for sharing information related to devices with EUAs, FDA commented that
there is an opportunity to build on prior collaboration and lessons learned during the pandemic
to assure there is a process in place that yields timely and consistent information for stakeholders
using and purchasing authorized devices. Regarding our recommendation for FDA to specify
a reasonable timeline and process for transitioning authorized devices that takes into account
stakeholder feedback, FDA stated that it believes it is important to provide such a transition period
to allow sponsors to meet any additional requirements. In addition, FDA stated it will provide
the transition plan in the form of draft guidance for public comment so the agency can work to
incorporate suggestions from those impacted by the transition.
DOL also concurred with the recommendation for OSHA to work with FDA and CDC to develop a
process for information sharing related to devices with EUAs. HHS and DOL provided technical
comments on this enclosure, which we incorporated as appropriate. OMB did not provide
comments on this enclosure.
Methodology
To conduct this work, we reviewed relevant agency documents, including FDA’s guidance for EUAs
and transcripts from webinars for medical device EUAs that FDA began hosting in June 2020. For
each device EUA, we reviewed publicly available documentation on FDA’s website as of March 10,
2021, including authorization letters for each EUA.227 We also reviewed relevant CDC and OSHA
documents related to safe use of devices during the COVID-19 pandemic. We received written
responses to questions from FDA, CDC, and OSHA oﬃcials.
226According to federal internal control standards for control activities, management should design control activities to
achieve objectives and implement those controls through policies. GAO-14-704G.
227We did not examine EUAs for COVID-19 tests as we have ongoing work examining EUAs for COVID-19 tests
separately.
Page 164
GAO-21-387

We also interviewed or received written responses from 15 stakeholder associations—2
associations representing device manufacturers, 1 association representing device distributors,
and 12 associations representing a variety of medical device purchasers, including 3 associations
representing state or local public health or emergency management departments, 8 associations
representing a variety of provider types, and 1 public health association. We selected these
national associations based on their involvement in representing stakeholders that manufacture
or purchase devices for use on the front lines of responding to the COVID-19 pandemic.
Contact information: Mary Denigan Macauley, (202) 512-7114, deniganmacauley@gao.gov
Related GAO Products
COVID-19: Federal Eﬀorts Accelerate Vaccine and Therapeutic Development, but More Transparency
Needed on Emergency Use Authorizations. GAO-21-207. Washington, D.C.: November 17, 2020.
Managing for Results: Key Considerations for Implementing Interagency Collaborative Mechanisms.
GAO-12-1022. Washington, D.C.: September 27, 2012.
Results-Oriented Government: Practices That Can Help Enhance and Sustain Collaboration among
Federal Agencies. GAO-06-15. Washington, D.C.: October 21, 2005.
Page 165
GAO-21-387

COVID-19 Cyber Response
The Department of Health and Human Services has continued collaboration and coordination
eﬀorts to mitigate cyber threats against assets and organizations targeted during the federal
response to COVID-19. In addition, the department continues to make progress implementing
our prior recommendations regarding cybersecurity weaknesses at its component agencies. We
encourage the Department of Health and Human Services’ component agencies to implement the
remaining open recommendations to bolster its cybersecurity posture.
Entities involved: Department of Health and Human Services; Cybersecurity and Infrastructure
Security Agency, within the Department of Homeland Security; and Federal Bureau of
Investigation, within the Department of Justice
Key Considerations and Future GAO Work
In our September 2020 report, we recommended that the Department of Health and Human
Services (HHS) expedite implementation of our prior 434 recommendations regarding
cybersecurity weaknesses at its component agencies. As of February 2021, HHS oﬃcials reported
actions the department is taking to implement the recommendation, to include leveraging its
monthly Chief Information Security Oﬃcer Council meetings to discuss recommendations made
across the HHS component agencies.
Additionally, HHS’s relevant component agencies—the Food and Drug Administration (FDA),
Centers for Medicare & Medicaid Services, and Centers for Disease Control and Prevention—have
addressed additional cybersecurity weaknesses since we reported in November 2020.228
Speciﬁcally, the three component agencies implemented an additional 17 of our previous
cybersecurity recommendations, bringing the total number of implemented recommendations
to 421 of the 434 we made to these agencies.229 This amount reﬂects a 4 percent increase in
corrective actions these component agencies have taken to bolster their cybersecurity.230
In addition to monitoring the department’s eﬀorts to expedite implementation of our prior
cybersecurity-related recommendations at its component agencies, we are conducting an
ongoing review of HHS’s roles and responsibilities for assisting with cybersecurity in the health
care and public health critical infrastructure sector.231 This review includes an evaluation of the
department’s eﬀorts to collaborate and coordinate as part of its response to COVID-19-related
cyberattacks.
228In November, we reported that the component agencies made a 12 percent increase in the number of
recommendations they implemented, bringing the total number of recommendations implemented from 350 to 404.
229As of January 2021, the Centers for Disease Control and Prevention had implemented all the prior cybersecurity
recommendations we made to the agency.
230We issued two cybersecurity recommendations to FDA. FDA had previously issued a waiver for one and accepted the
risk for the other; as a result, the recommendations were not implemented.
231Presidential Policy Directive 21 on critical infrastructure security and resilience identiﬁes health care and public health
as one of 16 critical infrastructure sectors. Critical infrastructure includes assets, networks, and systems that are vital to
the nation’s safety, prosperity, and well-being.
Page 166
GAO-21-387

Background
The federal response to COVID-19 has highlighted the need for additional focus on the security
of information systems that are used by health care organizations involved in vaccine and
therapeutic development and distribution, and that provide telehealth medical services. The
prior administration initiated Operation Warp Speed in May 2020 to accelerate the development,
manufacturing, and distribution of COVID-19 vaccines and therapeutics. In addition, health care
organizations began oﬀering health care services through telehealth appointments to slow the
spread of the virus. All of these eﬀorts rely heavily on the support of information systems.
During the nation’s response to COVID-19, systems operated by the health care and public
health sector have been the target of malicious cyber activity. The actors behind this activity were
attempting to obtain, among other things, patient information, intellectual property, public health
data, and intelligence. Therefore, it is imperative that safeguards are implemented on the systems
supporting the health care and public health sector. As the designated sector-speciﬁc agency for
the health care and public health critical infrastructure sector, HHS is responsible for collaborating
with sector partners and coordinating activities to mitigate the harm caused by cyber threats to
the sector’s systems.232
Overview of Key Issues
In our November 2020 report, we described HHS’s collaboration with health care organizations
and coordination with other federal agencies to address cybersecurity concerns associated with
COVID-19 in the health care and public health sector between March 2020 and August 2020.
Since that time, HHS has continued to collaborate with its sector partners through the various
cybersecurity-focused working groups it leads. During the cybersecurity-focused working groups’
meetings, HHS and its partners shared information about eﬀorts managed by Operation Warp
Speed and ongoing eﬀorts to secure telehealth medical services, as described here.
• During an August 2020 meeting for the Joint Healthcare and Public Health Sector Cyber
Working Group, the government and industry participants discussed chief information security
oﬃcers’ concerns with Operation Warp Speed due to perceived cyber threats to potential
COVID-19 therapeutic and vaccine supply chains.233
• During a September 2020 biweekly meeting, the Government Coordinating Council’s (GCC)
Cybersecurity Working Group Telehealth Task Group shared information on challenges to
protecting the security and privacy of health information and personal data as telehealth
232Sector-speciﬁc agencies are federal agencies with institutional knowledge and specialized expertise about a particular
sector and have been designated to have a lead role in critical infrastructure protection eﬀorts for that sector. With
regard to critical infrastructure protection eﬀorts going forward, the William M. (Mac) Thornberry National Defense
Authorization Act for Fiscal Year 2021 states that the term “sector risk management agency” has the meaning that was
given to the term “sector-speciﬁc agency”. Pub. L. No. 116-283, § 9002, 134 Stat. 3388, 4768 (Jan. 1, 2021).
233The Joint Healthcare and Public Health Sector Cyber Working Group is co-led by ASPR, the HHS Oﬃce of the
Chief Information Oﬃcer, and FDA, along with industry partners. It is a forum of government and industry partners
that facilitates discussion of issues and development of resources to enhance cybersecurity among health care
sector stakeholders.
Page 167
GAO-21-387

medical services were expanded and information was transferred across networks.234 The
task group highlighted the importance of considering vulnerabilities in the system architecture
supporting telehealth medical services as a way to mitigate security and privacy challenges.
• During the October 2020 meeting for the GCC Cybersecurity Working Group, HHS’s Oﬃce
of the Assistant Secretary for Preparedness and Response (ASPR) informed the meeting
participants that its Telehealth Task Group would serve as the entity through which federal
entities involved in providing telehealth medical services will collaborate to identify, prioritize,
and develop resources for federal agencies and their stakeholders to mitigate the major
cybersecurity, compliance, and privacy risks.
• During a December 2020 meeting with the Joint Healthcare and Public Health Sector Cyber
Working Group, the participants (1) discussed cybersecurity concerns related to Operation
Warp Speed’s vaccine distribution process; and based on these concerns, (2) planned to
document the cybersecurity risks and develop considerations for custodial checklists on cold
storage that may help mitigate those risks.
Moreover, oﬃcials in HHS’s Oﬃce of the Chief Information Oﬃcer informed us that the
department’s Chief Information Security Oﬃcer (CISO) attends weekly meetings with a limited
group of key stakeholders to collaborate around the implementation of Operation Warp Speed.
According to the oﬃcials, these meetings are held in addition to HHS CISO Council meetings and
are classiﬁed.235
HHS has also continued to coordinate with the Cybersecurity and Infrastructure Security Agency
(CISA) and Federal Bureau of Investigation (FBI). Speciﬁcally, HHS’s ASPR has continued to host
weekly meetings with the HHS Health Sector Cybersecurity Coordination Center, CISA, and FBI as
part of the Cyber Watch Project.236 Since August 2020, these federal agencies have coordinated
on:
• identifying additional entities involved in the development of vaccines and therapeutics that
the federal agencies plan to engage with as part of the project;
• resolving redundancies in the list of entities covered by Operation Warp Speed and the Cyber
Watch Project;
234The Government Coordinating Council’s Cybersecurity Working Group is an ASPR-led group of federal, state,
local, tribal, and territorial health care partners that coordinates to enhance critical infrastructure resiliency and
to reduce cyber risks across the public landscape of the health care sector. It established a Telehealth Task Group
in August 2020 to develop a standard-based practice guide to mitigate the major cybersecurity, compliance, and
privacy risks in the Telehealth ecosystem.
235The CISO Council is a collaborative eﬀort led by the HHS department-level CISO and is intended to facilitate the
sharing of information among the diﬀerent HHS component-level CISOs.
236The Health Sector Cybersecurity Coordination Center is a component of HHS’s Oﬃce of the Chief Information
Oﬃcer. It is intended to support the defense of the healthcare and public health sector’s information technology
infrastructure by providing technical analysis and information sharing within the sector. The Cyber Watch Project is
intended to execute and coordinate government-wide cyber engagements in support of health care sector entities that
are developing and testing COVID-19 therapeutics and vaccines.
Page 168
GAO-21-387

• determining how best to accurately advertise cybersecurity webinars and brieﬁngs so that
they reach the intended audiences;
• informing critical entities about recent ransomware attacks that occurred within the health
care and public health critical infrastructure sector; and
• ensuring that all federal agencies leading cyber engagement activities with the entities
involved in vaccine and therapeutic development have the latest information on all those
activities.
Agency Comments
We provided HHS and the Oﬃce of Management and Budget a draft of this enclosure for review
and comment. HHS and the Oﬃce of Management and Budget did not provide any comments on
this enclosure.
Methodology
To conduct this work, we obtained documentation demonstrating recent eﬀorts of HHS’s
cybersecurity-focused working groups to collaborate and coordinate with other entities on
cybersecurity issues related to COVID-19. Speciﬁc documentation we reviewed included meeting
presentations, summaries, and notes describing the information shared and discussed during
those working group meetings. In addition, we interviewed oﬃcials in HHS’s Oﬃce of the Chief
Information Oﬃcer and ASPR to obtain information and documentation on any new collaboration
or coordination eﬀorts to respond to the increased cyberattacks associated with COVID-19.
Further, to update the status of the recommendations made to the HHS component agencies, we
obtained and assessed evidence to determine whether the agency took appropriate corrective
action to resolve the cybersecurity weaknesses identiﬁed in our prior reports.
Contact information: Jennifer R. Franks, (404) 679-1831, franksj@gao.gov
Page 169
GAO-21-387

Telecommunications Funding for Telehealth
Between April and July 2020, the Federal Communications Commission obligated the full $200
million appropriated by the CARES Act to prevent, prepare for, and respond to COVID-19,
domestically or internationally, including for telehealth support through 539 awards to 532 health
care providers to fund, among other things, telehealth visits and remote patient monitoring during
the pandemic. According to Federal Communications Commission oﬃcials, as of February 18,
2021, $143.2 million of the $200 million had been disbursed.
Entity involved: Federal Communications Commission
Key Considerations and Future GAO Work
As of February 18, 2021, of the $200 million appropriated by the CARES Act, Federal
Communications Commission (FCC) oﬃcials told us that $143.2 million had been disbursed
to eligible health care providers (providers). FCC oﬃcials told us FCC expects the remaining
$56.8 million to be disbursed shortly after FCC’s July 31, 2021, invoicing deadline. Additionally,
in legislation enacted in December 2020, Congress appropriated approximately $250 million to
FCC for the COVID-19 Telehealth Program, which FCC has used to provide additional funding to
providers for telecommunications, information services, and connected devices.237 As of February
2021, FCC oﬃcials told us that FCC was continuing to review comments received in the public
record related to awarding this additional funding. We will continue to monitor FCC’s eﬀorts to
distribute funding appropriated through the COVID relief laws.
Background
Telehealth, or the provision of health care services through a range of telecommunications
technologies, has increasingly assumed a critical role in health care delivery throughout the U.S.
The ability to diagnose, monitor, and treat patients remotely allows providers to oﬀer critical
services to patients in their homes or in other physically distanced locations, which can reduce the
spread of communicable diseases such as COVID-19.
Demand for telehealth services dramatically increased because the COVID-19 pandemic limited
providers’ ability to treat patients in person.238 However, providers faced challenges oﬀering
telehealth services, including high implementation costs and limited patient access to broadband
237Consolidated Appropriations Act, 2021, Pub. L. No. 116-260, div. L, tit. IX, § 903, 134 Stat. 1182, 2128-29 (2020). Of the
approximately $250 million, $50,000 is allocated for the FCC Inspector General for oversight of the COVID-19 Telehealth
Program. In January 2021, FCC issued a request for public comments on matters identiﬁed in the authorizing legislation,
including the criteria FCC will use to select awardees. See Federal Communications Commission, Public Notice: Wireline
Competition Bureau Seeks Comment on COVID-19 Telehealth Program Application Evaluation Metrics (Washington, D.C.: Jan. 6,
2021).
238For the purposes of the COVID-19 Telehealth Program, FCC refers to “connected care services,” which it broadly
deﬁnes as a subset of telehealth that uses broadband internet access service-enabled technologies to deliver remote
medical, diagnostic, patient-centered, and treatment-related services directly to patients outside of traditional brick and
mortar facilities—including speciﬁcally to patients at their mobile location or residence. See Federal Communications
Commission, Promoting Telehealth for Low-Income Consumers, Report and Order, 35 FCC Rcd. 3366 (2020) ¶ 14.
Page 170
GAO-21-387

internet. Such barriers particularly aﬀect the public and nonproﬁt providers that serve low-income
patients.
In March 2020, FCC established the $200 million COVID-19 Telehealth Program in response to the
CARES Act to support eligible public and nonproﬁt providers’ provision of telehealth services by
funding eligible telecommunications services, information services, and connected devices on a
temporary basis.239 Examples of eligible services and devices include costs for mobile hot spots,
subscription costs for telehealth applications or platforms, and purchase costs for connected
monitoring devices such as wiﬁ, Bluetooth, or internet-connected blood pressure monitors.240
FCC obligated the $200 million to health care providers on a rolling basis between April 2020 and
July 2020. As of February 18, 2021, approximately $143.2 million had been disbursed to awardees.
In December 2020, FCC established a July 31, 2021 invoicing deadline for awardees to submit their
requests for reimbursement to FCC.
Overview of Key Issues
FCC application and reimbursement processes. FCC required providers seeking CARES Act
funding to submit applications that included information such as the medical services to be
provided, conditions and types of patients to be treated, and supporting cost documentation.
Providers were also required to complete additional steps, including obtaining an eligibility
determination and registering with FCC and the System for Award Management.241 FCC used
a review process in which multiple teams at escalating levels of seniority iteratively reviewed
applications. FCC oﬃcials considered a number of factors when reviewing and approving
applications which, according to FCC oﬃcials, were consistent with the guidance in the Report and
Order establishing the program. For example, FCC gave priority to providers that were located in
areas hardest hit by COVID-19, including those that would have the greatest impact based on the
amount of funding requested, the number of patients to be served, or whether a provider would
serve tribal communities.242
Once FCC obligated funding to awardees, they purchased eligible goods and services and
submitted requests to FCC for reimbursement, including invoice documentation, using the U.S.
Department of the Treasury’s Invoice Processing Platform. FCC oﬃcials told us that, as with
applications, these requests undergo a multilevel review process to verify that the goods and
239CARES Act, Pub. L. No 116-136, 134 Stat. 281, 531 (2020). FCC limited the program to public and nonproﬁt eligible
health care providers that fall within 47 U.S.C. § 254(h)(7)(B). See 35 FCC Rcd. 3366 (2020) ¶ 19, 20.
240Connected devices must be integral to patient care. Eligible services and devices may be for provider or patient use.
See 35 FCC Rcd. 3366 (2020) ¶¶ 19, 24.
241Federal Communications Commission, Public Notice: Wireline Competition Bureau Provides Guidance on the COVID-19
Telehealth Program Application Process (Washington, D.C.: Apr. 8, 2020). While applicants were required to have
an eligibility determination in order to receive an award, FCC permitted applicants to ﬁle an application with the
Commission while their request for eligibility determination was pending.
242FCC oﬃcials told us that they used Johns Hopkins University resource center data to identify the hardest hit areas. As
part of their compliance review, FCC oﬃcials said they also veriﬁed that applicants were not on the Department of the
Treasury’s “Do Not Pay” list.
Page 171
GAO-21-387

services purchased are eligible and that the invoice documentation supports the amount being
requested for reimbursement.
FCC oversight and performance management. According to FCC oﬃcials, the multilevel
application and reimbursement process provides FCC with oversight of the program and mitigates
identiﬁed risks to program integrity. For example, awardees must submit detailed invoices
substantiating reimbursement requests, which FCC reviews to ensure compliance with program
rules. FCC oﬃcials explained that this process guards against the risk of, and helps FCC identify,
improper payments. FCC oﬃcials told us that as of February 2021, they had identiﬁed seven
improper payments totaling just under $160,000 through their invoice review processes or
notiﬁcation by awardees, and had recovered about $112,000.243
In addition, FCC is leveraging audits conducted under the Single Audit Act to oversee the
program.244 One FCC oﬃcial told us that FCC estimates that about 66 percent of the funding
disbursed through the program is subject to Single Audit Act requirements. As of February 2021,
this oﬃcial said that auditors had completed 22 audits under the Single Audit Act that contained
the FCC compliance supplement for the COVID-19 Telehealth Program, and these audits did
not contain any ﬁndings. FCC oﬃcials said that while FCC had not yet conducted any additional
compliance audits, FCC continues to monitor the coverage of the Single Audit Act and other factors
to determine the need for such audits. Further, FCC stated that all awardees should submit post-
program feedback by January 2022 that includes, among other information, a description of the
funding outcomes.
Program challenges. FCC oﬃcials, selected providers, and telehealth associations we spoke
to identiﬁed some challenges with the application and reimbursement processes, such as the
following:
• Information technology system diﬃculties. FCC, both selected providers, and both telehealth
associations we spoke to reported complicated application and reimbursement systems
or systems that were not user-friendly or did not always work as planned. To address this
challenge, FCC intends to update its application system before accepting applications for the
additional funding appropriated in December 2020.245
• Site-speciﬁc eligibility determinations. Both selected providers we spoke to told us that because
eligibility is determined on a site-by-site rather than provider basis, it was more diﬃcult for
providers with multiple sites to apply for awards and seek reimbursement. FCC also noted
that this site-speciﬁc requirement delayed its ability to move quickly on many applications. To
243FCC oﬃcials said that they are in the process of recovering the remaining improper payments and expect to recover
all funds.
244The Single Audit Act is codiﬁed, as amended, at 31 U.S.C. §§ 7501-06, and implementing Oﬃce of Management
and Budget (OMB) guidance is reprinted in 2 C.F.R. Part 200 (2020). Federal award recipients that expend $750,000 or
more in federal awards in a ﬁscal year are required to undergo a single audit, which is an audit of an entity’s ﬁnancial
statements and federal awards, or a program-speciﬁc audit, for the ﬁscal year. 31 U.S.C. § 7502; 31 C.F.R. § 200.501
(2020).
245In its January 2021 public notice, FCC sought comment on processes for the second round of funding
appropriated in December 2020. FCC, Public Notice (2021).
Page 172
GAO-21-387

address this challenge, in January 2021 FCC sought comment on using a diﬀerent approach to
determine whether a site is eligible for future funding.246
• Lack of in-person assistance or unclear guidance from FCC. One selected provider and both
telehealth associations told us that FCC guidance was confusing. For example, one provider
said that email assistance from FCC did not help to clarify guidance on eligible goods and
services, so the provider did not understand what was and was not eligible until the invoicing
process, after completing purchases. As a result, the provider did not expect to receive
reimbursement for its full award amount. In January 2021, FCC proposed providing additional
outreach and guidance to applicants by, for example, publishing a list of eligible and ineligible
equipment and services for future funding.247
Additionally, both selected providers and telehealth associations told us that FCC did not cover
providers’ costs for support services and non-connected devices required to make eligible goods
and services work properly, such as training costs or costs for things like power cords. As a result,
according to one association, some providers were deterred from applying to the program, and
some that received funding struggled to cover these costs.
Distribution of funding. FCC made 539 awards to 532 health care providers in 49 U.S. states,
territories, and the District of Columbia.248 According to our analysis of FCC data, the number of
awardees and amount of funding varied across states (see ﬁgure). FCC awarded more than half
of the $200 million to health care providers in 10 states: New York, Ohio, California, Pennsylvania,
New Jersey, Texas, Florida, Massachusetts, Washington, and Louisiana. The awards generally
aligned with FCC’s prioritization of the hardest-hit geographic areas.249
246FCC, Public Notice (2021).
247FCC, Public Notice (2021).
248FCC oﬃcials noted that some providers may have facilities in multiple states that beneﬁtted from the funding, which
is not depicted in the award data. As a result, some states may have actually beneﬁtted from more or less funding than
described here. Six health care providers received two or more awards, which, according to FCC oﬃcials, were awarded
for diﬀerent locations, services, or connected devices. FCC oﬃcials also told us that FCC issued some awards to health
care consortiums that included providers from diﬀerent organizations.
249These determinations were based on the number of COVID-19 cases states reported to the Centers for Disease
Control and Prevention as of June 30, 2020.
Page 173
GAO-21-387

Total COVID-19 Telehealth Funding Awarded by the Federal Communications Commission and Number of
Awardees, by State
Note: Funds for the awards came from CARES Act, Pub. L. No 116-136, 134 Stat. 281, 531 (2020).
According to our analysis of FCC public notices, most awards included funding to support
telemedicine visits and to purchase connected devices, and were targeted toward continued
patient care (see table).250
250Health care providers may use funding for diﬀerent items and services than those for which FCC based its award
upon, as long as they comply with program rules. As a result, while FCC based its awards on the items and services listed
in the application, as described in our analysis, health care providers may seek reimbursement for diﬀerent eligible
items or services. However, the extent to which actual spending varied from the purposes identiﬁed in the awards above
is unclear because FCC’s deadline for submitting requests for reimbursement is not until July 2021.
Page 174
GAO-21-387

Purposes for the 539 COVID-19 Telehealth Awards Issued by the Federal Communications Commission
Award purpose
Number and percentage of
awards that included funding
for this purpose Examples of award purposes
Type of health care service supported
Telemedicine visits and care
480 (89%) Includes funding to support phone or video visits,
consultations, or other remote care conducted over
the phone or internet.
Remote monitoring
177 (33%) Includes funding for a program in which a
medical professional uses connected devices or
telecommunications services to monitor vital signs,
conditions, or other patient health statistics remotely.
Type of telecommunications service supported
Connected devices
471 (87%) Includes devices such as laptops, tablets, telehealth
carts, video equipment, or remote monitoring
devices that are connected to and transmit health
information using telecommunications services or
that facilitate telehealth visits.
Telehealth software
297 (55%) Includes applications, software licenses,
subscriptions, or platforms that facilitate telehealth
visits or remote monitoring.
Internet or telecommunications
service
195 (36%) Includes phone or internet services or plans,
including mobile hotspots, as well as network
upgrades that typically increase the overall speed,
capacity, or capability of phone or internet services.
Target population
High-risk or vulnerable patients
251 (47%) Includes funding speciﬁcally for patients that are
at higher risk for adverse health outcomes, such as
elderly or pediatric patients, patients with chronic
conditions, and low-income, underserved, un- or
under-insured, rural, and tribal populations.
Patients with suspected or
conﬁrmed COVID-19
173 (32%) Includes funding for diagnosis or treatment of
patients with suspected or conﬁrmed COVID-19.
Continued care of patients
without COVID-19
488 (91%) Includes funding to support continued care of
patients generally, such as primary or routine care,
preventative care, or specialty care, or to treat
patients with chronic conditions.
Source: GAO analysis of Federal Communications Commission public notices on COVID-19 telehealth awards from April to July 2020. | GAO-21-387
Note: Funds for the awards came from the CARES Act, Pub. L. No 116-136, 134 Stat. 281, 531 (2020). A single award can include
all or some of the purposes listed here. As a result, the number of awards listed for each purpose does not add up to the total
awards issued. Health care providers may seek reimbursement for diﬀerent items or service than those upon which FCC based
its awards, as long as they comply with program rules.
Page 175
GAO-21-387

Agency Comments
We provided a draft of this enclosure to FCC and the Oﬃce of Management and Budget for
comment. In its comments, reproduced in appendix V, FCC agreed with our ﬁndings. FCC also
provided technical comments which we incorporated as appropriate. The Oﬃce of Management
and Budget did not provide comments on this enclosure.
Methodology
We analyzed FCC data on COVID-19 telehealth funding obligated between April and July 2020,
including FCC’s public notices issued during that time. We conducted manual reviews, cross-
checked these data with corroborating sources, and interviewed FCC oﬃcials and found these
data to be reliable for the purposes of describing the obligation and purpose of the funding. We
also interviewed FCC oﬃcials responsible for overseeing the program. To obtain nongeneralizable
perspectives on the application and reimbursement processes, we interviewed two health care
providers that received funding, which we selected for a variety of funding amounts and locations,
and two telehealth associations that represent health care providers.
Contact information: Andrew Von Ah, (202) 512-2834, vonaha@gao.gov
Page 176
GAO-21-387

Hospital and Pharmacy Perspectives on COVID-19 Vaccine
Administration and Medical Supply Availability
Our February 2021 hospital survey and interviews with large retail pharmacy chains and an
association of independent pharmacies revealed concerns about COVID-19 vaccine availability and
limitations in certain key medical supplies for administering the vaccines—notably, syringes and
needles. Personal protective equipment and COVID-19 testing supplies also remain a challenge for
some.
Entities Involved: The Department of Health and Human Services and the Federal Emergency
Management Agency.
Key Considerations and Future GAO Work
Our CARES Act work has highlighted persistent constraints with the availability of certain types
of personal protective equipment (PPE) and testing supplies due to a supply chain with limited
domestic production and high global demand. Speciﬁcally:
• In September 2020, we found that the Food and Drug Administration (FDA) and the Federal
Emergency Management Agency (FEMA) had both identiﬁed shortages of certain supplies.
We also reported that an American Nurses Association survey indicated widespread reuse of
single-use N95 respirators, and that the majority of nurses who were required or encouraged
to do so were concerned about their safety as a result.
• In November 2020, we published the results of a nationwide survey of state and territorial
public health and emergency management oﬃcials, which indicated continued limitations
in the availability of certain medical supplies, such as nitrile gloves and reagents used for
COVID-19 testing.
• In January 2021, we reported that FEMA issued an extension through June 30, 2021, of
its temporary ﬁnal rule that generally prohibits the export of critical PPE, including N95
respirators, surgical masks, nitrile gloves, and surgical gowns. In issuing the rule on December
31, 2020, the agency noted that “domestic supply of the allocated PPE has not kept pace with
demand and is not anticipated to do so.”251 Similarly, as vaccination eﬀorts ramp up, FEMA has
identiﬁed projected shortages in certain medical supplies necessary for vaccination, such as
speciﬁc types of syringes and needles. The temporary ﬁnal rule added these items to the list of
supplies that may not be exported.
To address issues of supply shortages, we recommended in September 2020 that the Department
of Health and Human Services (HHS)—the lead agency in charge of the federal public health
response to the pandemic—in coordination with FEMA
251See 85 Fed. Reg. 86,835, 86,836 (Dec. 31, 2020).
Page 177
GAO-21-387

• further develop and communicate to stakeholders plans outlining speciﬁc actions the federal
government will take to help mitigate supply chain shortages for the remainder of the
pandemic.
• immediately document roles and responsibilities for supply chain management functions
transitioning to HHS, including continued support from other federal partners, to ensure
suﬃcient resources exist to sustain and make the necessary progress in stabilizing the supply
chain.
HHS disagreed with these recommendations, noting, among other things, the work that the
department had done to manage the medical supply chain and increase supply availability.
We recognize the eﬀorts of federal agencies in improving the supply chain. However, our February
2021 survey of oﬃcials from selected hospitals and our interviews with representatives from retail
pharmacy chains and an association of independent pharmacies, described below, underscore
the critical imperative that HHS and FEMA implement our recommendations. For example,
communicating with stakeholders, as we recommended, would help the agencies to determine
further steps needed to address concerns for the remainder of the pandemic. In our February
review, we found that some hospital oﬃcials and retail pharmacy chain representatives raised
concerns that the amount of vaccine doses they could administer were limited by the types of
syringes they were receiving. Taking the actions we previously recommended would help address
current medical supply chain challenges, as well as help to mitigate any future challenges.
The Consolidated Appropriations Act, 2021—passed in December of 2020—requires the President
to make publicly available a report containing a whole-of-government plan for eﬀective response
to subsequent COVID-19 outbreaks and for future global pandemic diseases. The act stipulates
that this pandemic plan should address how to improve the role of the federal government with
respect to the regulation, acquisition, and disbursement of medical supplies necessary to respond
to COVID-19, including the procurement and distribution of PPE, among other things. Developing
and making publicly available a pandemic plan that addresses medical supply needs for the
remainder of the current pandemic would be consistent with our September recommendation.
We recognize that the new administration has taken initial actions beginning in January 2021
to create a more resilient supply chain and increase vaccine availability. For example, the
administration has directed certain federal agencies to develop a strategy by July 2021 to design,
build, and sustain medical supply manufacturing capabilities in the U.S. long-term.252 Further, the
President has announced increased vaccine production, stating that the administration anticipates
enough vaccine supply for every adult in the U.S. by the end of May 2021. We will continue to
monitor these eﬀorts, as well as progress on our recommendations regarding the medical supply
chain.253
252Exec. Order No.14001, 86 Fed. Reg. 7219 (Jan. 26, 2021).
253See our enclosures on the Strategic National Stockpile and the Medical Supply Chain and Domestic Medical Product
Manufacturing in this report for additional information related to the medical supply chain.
Page 178
GAO-21-387

Background
Administering vaccines. Administering vaccines requires the ability of providers, such as
hospitals and pharmacies, to manage orders as well as additional storage, staﬀ, and IT system
capacity.
• Order management. Providers must be able to monitor the expected arrival of vaccine and
ancillary supply kits.
• Storage. Providers administering the vaccine need space for vaccines that may require varying
levels of cold storage.
• Staﬀ. Providing COVID-19 vaccines requires a suﬃcient number of trained staﬀ to handle the
vaccines, manage vaccine inventory, and administer vaccines.
• IT systems. Providers need to use information technology (IT) systems capable of managing the
various processes involved in tracking COVID-19 vaccines.
Vaccine supplies. The quantity of supplies needed to administer COVID-19 vaccines to the
U.S. population is so large that the federal government has contracted for the production
and assembly of vaccine-related supplies into ancillary kits that it is distributing to facilities
administering the vaccine. The ancillary supply kits contain surgical masks, face shields,
syringes, needles, alcohol prep pads, vaccination cards, and—if applicable—diluent, a liquid
for reconstituting a vaccine.254 The kits do not include other supplies such as sharps disposal
containers or bandages. (See ﬁgure below.) Our previous survey of state and territorial public
health and emergency management oﬃcials in October 2020 generally indicated there were
concerns about whether providers would have suﬃcient supplies to administer vaccines when
available.
254The exact content of the kits may vary depending on the speciﬁc vaccine. A vaccination card shows an individual
has received a vaccine (and how many doses) and documents relevant information such as vaccine manufacturer, lot
number, and date of administration for each dose. Diluent is used to reconstitute Pﬁzer-BioNTech’s COVID-19 vaccine.
Page 179
GAO-21-387

Examples of COVID-19 Vaccine Administration Supplies
Notes: The exact content of the kits may vary depending on the speciﬁc vaccine. A vaccination card shows an individual has
received a vaccine (and how many doses) and documents relevant information such as vaccine manufacturer, lot number, and
date of administration for each dose. Diluent is used to reconstitute Pﬁzer-BioNTech’s COVID-19 vaccine.
PPE and testing supplies. The demands of the global COVID-19 pandemic overwhelmed
the medical supply chain, causing constraints in the availability of PPE supplies, including
N95 respirators, surgical gowns, and gloves, as well as supplies needed to test patients for
COVID-19 (see ﬁgures below). Testing supplies include nasal swabs used to collect viral specimens
from patients, transport media that keep samples viable for testing, reagents and laboratory
consumables—such as pipette tips—used to process tests, and rapid point-of-care tests.
Page 180
GAO-21-387

Examples of Personal Protective Equipment
Examples of COVID-19 Testing Supplies
Overview of Key Issues
Our February 2021 survey of hospitals and interviews with large retail pharmacy chains and
an association of independent pharmacies indicate these providers are concerned about
COVID-19 vaccine availability and limitations in certain key medical supplies for administering
Page 181
GAO-21-387

the vaccines—notably, syringes and needles.255 PPE and COVID-19 testing supplies also remain a
challenge for some.
Providers expressed concerns about COVID-19 vaccine availability. Of the 166 total hospitals
responding to our survey, 102 (61 percent) reported not having suﬃcient information to respond
to questions from their staﬀ, the public and others about vaccine availability.256 Among the
subset of rural hospitals responding to our survey (68 of 166 hospitals), 42 were concerned about
responding to questions about vaccine availability.257
In addition, 35 of the 166 hospitals (21 percent) described concerns with general vaccine
availability in open-ended survey responses.258 For example, three hospitals reported concerns
about having enough vaccine to administer a second dose to vaccine recipients. Another hospital’s
staﬀ responded that they had to cancel more than 1,000 planned vaccine doses to their most
vulnerable populations due to lack of vaccines.
Similarly, our interviews with representatives from retail pharmacy chains and an association
of independent pharmacies also revealed concerns about vaccine availability. Representatives
from all nine retail pharmacy chains we interviewed stated that although their pharmacies have
begun administering vaccines, their potential to administer vaccines is far greater than the current
amount of vaccines available.
255Survey results are based on our survey ﬁelded to 383 hospitals across the country from February 5 through February
25, 2021. We received responses from 166 hospitals. Not all hospitals responded to each survey question. Results of the
survey cannot be generalized. We also interviewed nine large retail pharmacy chains (based on 2019 prescription drug
revenue) and a pharmacy association representing independently owned pharmacies, along with four of its member
pharmacies. Results of the interviews cannot be generalized. See “Methodology” section of this enclosure for more
detail.
256For our non-generalizable survey, we asked all survey respondents which of the following items they would say their
hospitals did not have suﬃcient information about to respond to COVID-19 vaccine inquiries from staﬀ, the public,
and others: vaccine availability; vaccine eﬃcacy/eﬀectiveness; how to respond to vaccine questions in languages other
than English; how to increase an individual’s interest or address lack of interest or willingness to be vaccinated; other
locations administering the vaccine, if the hospital does not plan to administer vaccine or does not have any vaccine
(e.g., using tools such as VaccineFinder); other (with a space for respondents to ﬁll in). Respondents were asked to select
all options that applied as of the date they were answering the survey. 165 hospitals (out of 166) responded to this
question, with 102 hospitals reporting “vaccine availability” as a concern. The second highest selected response to our
question was, “how to increase an individual’s interest in vaccination or to address lack of interest or willingness to be
vaccinated,” with 30 hospitals (18 percent) reporting this response. All other response options to this question were
reported by less than 15 percent of survey respondents.
257166 hospitals responded to our non-generalizable survey. Of these, 68 hospitals (41 percent) were categorized as
rural and 77 hospitals (46 percent) were categorized as urban. Hospitals categorized as urban are located in a county
that contains a core urban area of 50,000 or more population, and those categorized as rural are located in a county
not designated as such. Twenty-one of the survey responses we received were on behalf of a larger health system or
multiple facility group representing multiple hospitals and therefore could not be categorized as urban or rural due to
their multiple locations.
258For our non-generalizable survey, we asked all survey respondents to elaborate on their survey responses or
share any additional information or thoughts concerning their hospital’s recent experiences during the COVID-19
pandemic. 55 hospitals (out of 166) responded to this question. Our survey did not speciﬁcally ask whether hospitals
were concerned about the supply of vaccines.
Page 182
GAO-21-387

For example, representatives from one retail pharmacy chain that is participating in the Federal
Retail Pharmacy Partnership Program—a federal program for administering vaccines—stated that
the chain has the capacity to administer 25 million doses per month at their 9,900 locations.259
However, the chain’s initial allocation of vaccines via the program was expected to be only 230,000
doses at 250 locations.
Representatives from an association of independent pharmacies expressed similar concerns
about the quantity of vaccines available.
In addition to underutilization, several retail pharmacy chain representatives indicated that limited
vaccine availability has led to uncertainty regarding the amount of vaccines their pharmacies can
expect to receive each week. Without suﬃcient information on vaccine allocation, it is diﬃcult to
determine how many vaccine appointments they can schedule or the number of staﬀ needed to
fulﬁll those appointments. For example, representatives from one retail pharmacy chain said that
due to uncertainty over the amount of vaccines they may receive in a given week, they can only
schedule appointments on a week-to-week basis, which makes it diﬃcult to address customers’
questions about when they will be able to schedule their vaccinations.
The new administration has taken steps to increase certainty and vaccine availability. For example,
the White House announced at the end of January 2021 that the federal government would begin
notifying states earlier about availability and shipments of vaccines, to give greater certainty
for planning vaccination eﬀorts.260 Further, the President stated on March 2, 2021, that the
administration expects to have produced enough vaccine for every adult in the U.S. by the end of
May 2021.
Providers expressed concerns about availability of syringes and needles. In our survey,
hospitals expressed concerns about the syringes and needles provided in the ancillary supply kits.
Out of the 146 hospitals that reported they have either begun administering COVID-19 vaccines or
plan to do so, 40 hospitals (27 percent) reported being greatly concerned about having a suﬃcient
quantity of syringes in the next 30 days, and 43 hospitals (29 percent) were greatly concerned
about having a suﬃcient quantity of needles.261
259The Federal Retail Pharmacy Partnership Program is a collaboration between the federal government, states and
territories, and 21 national pharmacy partners and independent pharmacy networks to increase access to COVID-19
vaccines across the United States.
260White House, Fact Sheet: President Biden Announces New Steps to Boost Vaccine Supply and Increase Transparency
for States, Tribe, and Territories (Washington, D.C.: Jan. 26, 2021), www.whitehouse.gov/brieﬁng-room/statements-
releases/2021/01/26/fact-sheet-president-biden-announces-new-steps-to-boost-vaccine-supply-and-increase-
transparency-for-states-tribes-and-territories, accessed on March 5, 2021.
261Of the 166 hospitals that responded to our non-generalizable survey, 146 hospitals (88 percent) have begun
administering COVID-19 vaccines or plan to. Of these 146 hospitals, 140 (96 percent) had begun administering the
vaccines at the time of our survey. We asked the 146 survey respondents that reported that they have either begun
administering COVID-19 vaccines or plan to do so whether they were greatly concerned about having suﬃcient
quantity of certain items—alcohol prep pads; bandages; diluent, if needed; needles; syringes; sharps containers;
vaccination cards; other (ﬁll-in)—in order to successfully handle and administer any COVID-19 vaccine in the next
30 days. Respondents were asked to select all options that applied. 144 hospitals (out of the 146) responded to this
question. The next highest selected response to our question was “sharps containers,” with 23 (16 percent) of the 146
respondents reporting this concern. Hospitals must procure these containers themselves—they are not provided in
Page 183
GAO-21-387

Among the 146 hospitals that had either begun administering COVID-19 vaccines or planned
to do so, a subset of 56 were rural hospitals. Of these 56 rural hospitals, 10 hospitals were
greatly concerned about quantities of syringes in the next 30 days, and 14 hospitals were greatly
concerned about needles.
According to FDA, certain types of syringes and needles may allow health care providers to extract
more doses of the COVID-19 vaccines than others.262 Maximizing the number of doses is crucial
during a time of constrained vaccine supply. Four hospitals speciﬁcally noted this issue in open-
ended responses.263
Representatives from retail pharmacy chains also discussed this issue. Speciﬁcally, representatives
from ﬁve of the nine retail pharmacy chains expressed concerns that the provided ancillary supply
kits do not always contain the most eﬃcient syringes needed to obtain the maximum doses of
vaccines from each vial. Representatives from one retail pharmacy chain that had administered
more than 200,000 doses at the time of our interview indicated that optimal syringes were only
included in the ancillary supply kits about 50 percent of the time. Representatives from two retail
pharmacy chains also noted that these syringes are in short supply on the open market.
The lack of more eﬃcient syringes limits the ability to maximize the number of doses per vial,
which further constrains the supply of vaccine. In January 2021, HHS and Department of Defense
oﬃcials managing vaccine implementation told us they have recognized this issue and are working
toward ensuring the majority of syringes included in the ancillary supply kits are the more eﬃcient
type of syringes. We will continue to monitor HHS’s vaccination eﬀorts moving forward, including
whether they have addressed this issue.
Providers cited several areas of concern about their capacity to administer the COVID-19
vaccine. In addition to supplies, administering vaccines requires managing vaccine orders as well
as having additional storage, staﬀ, and IT system capacity. See table below for the most commonly
cited concerns among the 146 hospitals that plan to or have begun administering vaccines at the
time of our survey. The subset of 56 rural hospitals generally cited the same concerns.264
the ancillary supply kits. All other response options to this question were reported by less than 15 percent of survey
respondents.
262The vials of COVID-19 vaccine manufactured by Pﬁzer were initially labeled for ﬁve doses of vaccine each, and the
Moderna vaccine vials were labeled for 10 doses each. Depending, in part, on the type of syringes and needles used
to withdraw doses from the vials, providers may be able to obtain a sixth dose from each vial of Pﬁzer vaccine and an
eleventh dose for the Moderna vaccine. As of February 25, 2021, FDA has instructed providers that Pﬁzer vials have
enough vaccine for six doses with the use of low dead-volume syringes and needles, which minimize waste by reducing
dead space between the syringe hub and the needle.
263We were unable to determine whether the 40 hospitals reporting they were greatly concerned about having a
suﬃcient quantity of syringes and the 43 hospitals reporting such concerns for needles, did so because of this issue or
because of other general concerns about having enough supplies.
264The exception among rural hospitals was “being able to track the expected arrival of kits with ancillary vaccination
supplies to the hospital” with ﬁve of the 56 rural hospitals responding that they had great concerns about this issue.
Page 184
GAO-21-387

Surveyed Hospitals’ Most Commonly Cited Concerns about Capacity to Administer Vaccines in February 2021
Number of
hospitals
Hospitals that plan to or have begun administering COVID-19 vaccines
146
Ordering a concerns
Being able to track the expected arrival of vaccine orders
40
Being able to track the expected arrival of kits with ancillary vaccination supplies to the hospital
22
Storage b concerns
Storing vaccine in ultra-cold storagec
32
Staﬀ d concerns
Having suﬃcient number of trained providers to administer vaccine
33
IT systems e concerns
Interfacing with state or other external IT systems to document vaccine administration
31
Meeting federal reporting requirements for vaccine administration (e.g., reporting all required elements,
reporting within required time frames)
24
Source: GAO analysis of hospital survey responses. | GAO-21-387
Notes: The results in this table are based on our non-generalizable survey sent to 383 short-term and critical access hospitals
across the country. We ﬁelded the survey from February 5, 2021 through February 25, 2021, and received responses from 166
hospitals. Twenty-one of the survey responses we received were on behalf of a larger health system or multiple facility group
representing multiple hospitals. For the purposes of this enclosure, we reported each health system’s response as a single
hospital response rather than as the number of hospitals represented by the system. For this survey question, we asked the
146 hospitals that reported they plan to, or have begun, administering COVID-19 vaccines to report whether they were greatly
concerned about their capacity to handle speciﬁc aspects of the vaccine, as of the date they were answering the survey. Survey
respondents also had an open-response option to report any other concerns not listed in the survey response options. The
concerns in the table above were cited by at least 15 percent of the 146 hospitals.
aOrdering vaccine concerns response options were: using required IT systems to order vaccine; being able to monitor the
expected arrival of vaccine orders to the hospital; being able to monitor the expected arrival of kits with ancillary vaccination
supplies to the hospital; other (ﬁll-in); and no great concerns about ordering vaccines. 146 hospitals responded to the questions
in the ordering category.
bStoring vaccine concerns response options were: storing refrigerated (2°C to 8°C) vaccine; storing frozen(-15° C to -25°C)
vaccine; storing ultra-cold (-60°C to -80°C) vaccine; other (ﬁll-in); and no great concerns about vaccine storage. 145 hospitals
responded to questions in the storing category.
cPﬁzer-BioNTech’s COVID-19 vaccine requires ultra-cold storage between -80°C and -60°C (-112°F and -76°F) when storing for
longer periods of time.
dStaﬀ to manage and administer vaccine concerns response options were: having suﬃcient number of trained staﬀ to handle
and manage vaccine inventory; having suﬃcient number of trained providers to administer vaccine; other (ﬁll-in); and no great
concerns about staﬀ. 144 hospitals responded to questions in the staﬀ category.
eHaving/using IT systems to track/report administered doses concerns response options were: having IT systems to track
the ﬁrst dose of vaccine administered to patients; having IT systems to remind patients of need for a second dose, if needed;
interfacing with state or other external IT systems to document vaccine administration; meeting federal reporting requirements
Page 185
GAO-21-387

for vaccine administration (e.g. reporting all data elements required, reporting administrations within required time frames);
other (ﬁll-in); and no great concerns about IT systems. 144 hospitals responded to questions in the IT systems category.
Representatives from all nine retail pharmacy chains and an association of independent
pharmacies named data reporting requirements as a concern. Commonly cited concerns included
• diﬀerent local, state, and federal requirements. Representatives from eight retail pharmacy
chains and an association of independent pharmacies noted challenges in meeting data
requirements that diﬀer across local, state, and federal governments. For instance, according
to representatives from one retail pharmacy chain, one locality requires documenting
recipients’ professions, while others do not. These unique elements are not always included in
existing data systems, making it diﬃcult to determine how to report them.
• interoperability limitations. Representatives from seven retail pharmacy chains and a
representative from an independent pharmacy also stated that interoperability limitations of
some state data reporting systems have resulted in challenges, such as pharmacy staﬀ having
to manually transfer required information. As one retail pharmacy chain’s representative
noted, this process is complicated, especially for chains that must coordinate across hundreds
of locations.
• time frames for reporting. The deadlines for submitting reports present some challenges.
The federal government requires pharmacies to report data within 72 hours. However,
representatives from ﬁve retail pharmacy chains and one independent pharmacy said that
some states require reports within 24 hours. A representative from an independent pharmacy
said such daily reporting has been a learning curve.
Representatives from three retail pharmacy chains and two independent pharmacies reported
taking various actions to address identiﬁed challenges, including investing in new software, hiring
additional administrative support, or modifying staﬀ responsibilities, such as diverting pharmacists
from administering vaccines. Representatives from two independent pharmacies mentioned the
increased expenses pharmacies have incurred to address COVID-19 but noted that they have not
received federal funding to pay for the additional staﬀ and supplies they need.
We have previously reported on data challenges related to COVID-19. For example, in September
2020 we described state and local public health oﬃcials’ concerns regarding the cost and eﬀort
associated with providing data to federal entities to be integrated and shared on a nationwide
basis. Also, in January 2021, we reported that the federal government does not have a process
to help systematically deﬁne and ensure the collection of standardized data across the relevant
federal agencies and related stakeholders to help respond to COVID-19. We recommended that
HHS immediately establish an expert committee or use an existing one to systematically review
and inform the alignment of ongoing data collection and reporting standards for key health
indicators. In its comments, HHS partially concurred that it should establish such a body, but said
because of resource constraints and the ongoing response to the pandemic, it could not commit
to immediately doing so. We reiterate the importance of immediately establishing an expert
committee and maintain that HHS could use an existing committee, which would help streamline
the process and leverage existing resources, to help inform the federal government’s response to
the pandemic with more complete and consistent COVID-19 data.
Page 186
GAO-21-387

Providers generally reported suﬃcient PPE at current levels with some reuse, but were less
conﬁdent of future availability for certain items. Most of the 166 hospitals that responded to
our survey reported having an adequate 7-day supply of the 11 types of PPE we asked about in
our survey. (See ﬁgure below.) However, in some cases, hospitals reported avoiding shortages only
with reuse or extending the use of the items.265
• For example, 37 out of 166 hospitals (23 percent) reported needing to reuse or extend the use
of N95 respirators in order to have a 7-day supply.
• Among the 68 rural hospitals that responded to our survey, 17 reported having to reuse N95
respirators in order to ensure a 7-day supply.
While CDC guidance allows for the reuse or extended use of certain PPE when there are supply
shortages, once supply availability returns to normal, CDC recommends health care facilities
promptly resume conventional practices. Our previous audit work has identiﬁed concerns among
health care providers about the reuse or extended use of PPE. For example, in September 2020
we reported that an American Nurses Association survey indicated widespread reuse of single-use
N95 respirators, and that the majority of nurses who were required or encouraged to do so were
concerned about their safety as a result. The association’s latest survey, issued in March 2021,
indicated this practice may still be prevalent—82 percent of nurses surveyed reported their facility
or practice site had guidance allowing N95 respirators to be reused multiple times.266
265See our enclosure on the Strategic National Stockpile and the Medical Supply Chain in this report for additional
information and recommendations related to the medical supply chain.
266The American Nurses Foundation conducted a survey of 22,316 nurses across the country. American Nurses
Foundation, Pulse on the Nation’s Nurses COVID-19 Survey Series: Year One COVID-19 Impact Assessment (Feb. 2021). Further,
representatives from the American Association of Critical-Care Nurses told us that a March 2021 survey of 295 of
their members found that among the 180 respondents who described their worksites as “fully equipped with N95
respirators,” 125 (69 percent) were still required or encouraged to reuse them despite the adequate supply, suggesting
such policies are becoming entrenched.
Page 187
GAO-21-387

Surveyed Hospitals’ 7-Day Supply Levels of Selected Personal Protective Equipment (PPE)
Notes: The results are based on our non-generalizable survey sent to 383 short-term and critical access hospitals across
the country. We ﬁelded the survey from February 5, 2021 through February 25, 2021, and received responses from 166
hospitals. Twenty-one of the survey responses we received were on behalf of a larger health system or multiple facility group
representing multiple hospitals. For the purposes of this enclosure, we reported each health system’s response as a single
hospital response rather than as the number of hospitals represented by the system. For this survey question, we asked—for
each PPE item—if the hospital had at least a 7-day supply of the items listed above based on current operations: (1) without
reusing or extending the use of the PPE item, or (2) with reusing or extending the use of the item. In addition to the four
response categories shown above, respondents could answer “do not know” and one respondent did so for each PPE item
above except for non-surgical masks and other gowns (2); nitrile gloves, other gloves, boot covers, and bouﬀant caps (3); and
coveralls (6). Further, not all 166 hospitals responded to each PPE item in the question; there was one non-response for each
PPE type listed above except for non-surgical masks (4), other gloves (5), other gowns (4), and coveralls (2).
aOther gloves include those made of latex and vinyl.
bOther gowns include non-surgical gowns and isolation gowns.
Like hospitals, pharmacies use PPE—primarily masks, gloves, and face shields—to protect their
staﬀ and to limit transmission of the virus. Representatives from all nine retail pharmacy chains
and one independent pharmacy said their pharmacies had at least 7 days of PPE available,
including masks and gloves. Representatives from ﬁve of the nine retail pharmacy chains and
representatives from two independent pharmacies mentioned reuse of face shields after
Page 188
GAO-21-387

appropriate cleaning, but representatives from four other retail pharmacy chains indicated they
had enough supply that staﬀ did not need to reuse or extend the use of any PPE.
The extent to which hospitals expressed conﬁdence in their future supply of PPE supplies (deﬁned
as expected PPE for the 30 days following the survey) varied by PPE type. (See ﬁgure below.) For
example:
• Of the 166 hospitals, 136 (82 percent) were greatly conﬁdent in having suﬃcient supplies for
face shields and goggles.
• In contrast, for nitrile gloves, 94 out of 166 surveyed hospitals (57 percent) were greatly
conﬁdent they would have suﬃcient supplies over the next 30 days, while 31 hospitals (19
percent) responded that they were only slightly conﬁdent or not at all conﬁdent they would
have suﬃcient supplies of these gloves.
• Twelve of the sixty-eight rural hospitals reported they were slightly or not at all conﬁdent in
having an adequate 30-day supply of nitrile gloves.
Page 189
GAO-21-387

Surveyed Hospitals’ Levels of Conﬁdence in Having Adequate Personal Protective Equipment (PPE) Supplies for
the Next 30 Days
Notes: The results are based on our non-generalizable survey sent to 383 short-term and critical access hospitals across
the country. We ﬁelded the survey from February 5, 2021 through February 25, 2021, and received responses from 166
hospitals. Twenty-one of the survey responses we received were on behalf of a larger health system or multiple facility group
representing multiple hospitals. For the purposes of this enclosure, we reported each health system’s response as a single
hospital response rather than as the number of hospitals represented by the system. For this survey question, we asked—for
each PPE item—the extent to which respondents were conﬁdent they would have suﬃcient supplies over the next 30 days
following the survey. In addition to the ﬁve response categories shown above, respondents could answer “do not know,” and
one respondent did so for each of the PPE items except for boot covers (2); nitrile gloves, other gowns, coveralls, and bouﬀant
caps (3); and other gloves (5). Not all 166 hospitals responded to each PPE item in this question. The following PPE items each
had one non-response: surgical masks, nitrile gloves, other gloves, surgical gowns, coveralls, and bouﬀant caps.
aOther gloves include those made of latex and vinyl.
bOther gowns include non-surgical gowns and isolation gowns.
In our interviews with retail pharmacy chains, all representatives explained that they maintained
their supplies using a centralized procurement system, with four representatives saying they
anticipated and ordered additional supplies in early 2020. Representatives from all nine retail
pharmacy chains reported being conﬁdent or very conﬁdent their pharmacies could access 30
days or more of PPE. Representatives from three independent pharmacies also had no concerns
Page 190
GAO-21-387

about meeting their needs for PPE over the next month, although a representative from a fourth
independent pharmacy reported challenges securing N95 respirators. While there was conﬁdence
over the next 30 days, representatives from three retail pharmacy chains and two independent
pharmacies expressed concern regarding the future availability of gloves.
Hospitals reported some concerns about future availability of testing supplies, while
pharmacies generally reported suﬃcient access. Of the surveyed hospitals conducting
COVID-19 diagnostic testing (158 out of 166), most reported having at least a 7-day supply for each
of the ﬁve testing items we asked about in our survey (ranging from 84 to 95 percent).267 However,
hospitals were somewhat less conﬁdent about levels of those same supplies over the next 15
days. (See ﬁgure.) In addition, rural hospitals conducting COVID-19 diagnostic testing generally
reported having at least a 7-day supply for each testing item but were somewhat less conﬁdent
about supplies over the next 15 days. For example, nine of the 66 rural hospitals conducting
testing were not at all or only slightly conﬁdent in supplies of rapid point-of-care tests for the next
15 days following the survey.
Surveyed Hospitals’ Levels of Conﬁdence in Having Adequate Testing Supplies for the Next 15 Days
Notes: The results are based on our non-generalizable survey sent to 383 short-term and critical access hospitals across
the country. We ﬁelded the survey from February 5, 2021 through February 25, 2021, and received responses from 166
hospitals. Twenty-one of the survey responses we received were on behalf of a larger health system or multiple facility group
representing multiple hospitals. For the purposes of this enclosure, we reported each health system’s response as a single
hospital response rather than as the number of hospitals represented by the system. For this survey question, we asked—for
each testing item—the extent to which the 158 respondents conducting diagnostic tests for COVID-19 were conﬁdent they
would have suﬃcient supplies over the next 15 days following the survey. In addition to the ﬁve response categories shown
267Of the 166 hospitals that responded to our survey, 158 hospitals reported that they conduct diagnostic tests for
COVID-19. Our survey did not address antibody tests, which do not diagnose a current infection, but rather indicate
an infection in the past. Those hospitals that do not conduct diagnostic testing did not respond to the testing supplies
questions. See our enclosure Funding for COVID-19 Testing for more information on testing issues.
Page 191
GAO-21-387

above, respondents could answer “do not know,” and ﬁve respondents did so for each of the above testing items, except for
testing swabs (3). Not all of the 158 hospitals conducting COVID-19 diagnostic testing responded to each testing item in the
question; the testing swabs, laboratory consumables, and rapid point-of-care tests items each had one non-response, and
reagents had two.
Representatives from four of the nine retail pharmacy chains and the four independent
pharmacies we interviewed conduct COVID-19 testing. These representatives did not report
current problems accessing testing supplies. However, representatives from the association of
independent pharmacies mentioned challenges obtaining the testing instruments needed to
analyze rapid point-of-care tests. A representative from one independent pharmacy noted that
there are “testing deserts” in his state due to the lack of this equipment.
Agency Comments
We provided HHS and the Oﬃce of Management and Budget (OMB) with a draft of this enclosure.
HHS and OMB did not provide any comments.
Methodology
To conduct this work, we designed and ﬁelded a survey to hospitals. The survey asked about
hospital oﬃcials’ perspectives on the availability of supplies to administer vaccines as well as their
capacity for, or concerns regarding, administering COVID-19 vaccines. The survey also contained
questions designed to obtain hospital oﬃcials’ perspectives on the availability of PPE for hospital
staﬀ and COVID-19 testing supplies.
We ﬁelded this survey from February 5 through February 25, 2021. Oﬃcials completing the survey
included those knowledgeable of these issues such as chief executive oﬃcers and supply chain
directors. We pretested a draft of the survey with oﬃcials from two hospitals to help ensure that
the questions were understandable and answerable.
We obtained 383 hospital oﬃcial email addresses for short-term and critical access hospitals
in several states, to which we sent a personalized survey link.268 From this, we received 166
responses from hospitals located in 40 states for a response rate of 43 percent. See table
below for more information on our non-generalizable sample and response rates by hospital
characteristic. In 21 instances, oﬃcials responded on behalf of multiple hospitals in a health
system rather than on behalf of an individual hospital. (Therefore, we had 145 individual hospital
respondents.) For the purposes of this enclosure, we reported each health system’s response as a
single hospital response rather than as the number of hospitals represented by the system.269
268To obtain these 383 email addresses, we randomly selected and then contacted 600 short-term and critical access
hospitals from 4,682 of these types of hospitals in the Centers for Medicare & Medicaid Services’ 2020 Provider of
Services ﬁle. We selected these types of facilities because they are most likely to be on the front lines of treating
COVID-19 patients, since they provide acute care.
269The 21 responses on behalf of multiple hospitals represented 300 hospitals.
Page 192
GAO-21-387

Hospital Survey Sample Size, Characteristics, and Response Rates
Hospital characteristic
Population a
Survey sample
b
Total number
of survey
responses
received c
Number of
survey responses
received on
behalf of
individual
hospitals
Survey
response rate
for individual
hospitals
(percent) d
Total
4,682
383
166
145
38
Type of hospital
Short-terme
3,328
281
N/A
92
33
Critical accessf
1,354
101
N/A
53
52
Intensive care services
availability
Intensive care unit
3,177
258
N/A
87
34
Urban and rural settings g
Urban
2,832
238
N/A
77
32
Rural
1,850
144
N/A
68
47
Legend: N/A = not applicable
Source: GAO analysis of survey data and the Centers for Medicare & Medicaid Services’ 2020 Provider of Services ﬁle. | GAO-21-387
Notes: We ﬁelded our survey from February 5 through February 25, 2021.
aThe population values represent the number of short-term and critical access hospitals in the Centers for Medicare & Medicaid
Services’ 2020 Provider of Services ﬁle.
bThe sample values represent the number of hospitals sent an email with a personalized survey link. Numbers for a particular
characteristic may not sum to 383 because a health system was substituted for one hospital prior to sending the survey.
cIn 21 instances, oﬃcials responded on behalf of multiple hospitals in a health system rather than on behalf of an individual
hospital. For the purposes of this enclosure, we reported each health system’s response as a single hospital response rather
than as the number of hospitals represented by the system. The 21 responses on behalf of multiple hospitals represented
300 hospitals. We could not categorize these responses by hospital characteristics (e.g., urban or rural) due to the multiple
locations.
dThe total response rate (166 out of 383) was 43 percent.
eShort-term hospitals are hospitals that provide acute inpatient care. For this report, short-term hospitals refer to acute care
hospitals that are not critical access hospitals.
fCritical access hospitals are small, rural hospitals with no more than 25 inpatient beds.
gCenters for Medicare & Medicaid Services’ Provider of Services ﬁle categorizes hospitals as urban if they are located in a county
that contains a core urban area of 50,000 or more population. Hospitals are categorized as rural if they are located in a county
not designated as such.
We checked for missing values and survey response errors such as inconsistencies—for example,
responding to COVID-19 testing-speciﬁc questions after indicating the hospital does not conduct
such testing—and followed up with hospital oﬃcials on survey responses as appropriate.
Page 193
GAO-21-387

We also conducted semi-structured interviews with nine of the top 10 national retail pharmacy
chains based on 2019 prescription drug revenue.270 These retail pharmacy chains provide for
a mix of size, as well as of urban and rural pharmacies. In addition to chain pharmacies, more
than 21,000 (35 percent) of retail pharmacies nationwide were independently owned in 2019. We
interviewed representatives from four independent pharmacies and from the National Community
Pharmacists Association, which represents independent pharmacies.
The results of our survey and interviews are not generalizable beyond those we surveyed
or interviewed, though they can provide important insights into hospitals’ and pharmacies’
experiences with vaccine administration and medical supplies.
Contact information: Mary Denigan-Macauley, (202)512-7114, DeniganMacauleyM@gao.gov
270We attempted to interview all of the top 10 national retail pharmacy chains. We interviewed representatives from
Ahold Delhaize; Albertsons Companies; Costco Wholesale; CVS Pharmacy; H-E-B; Publix; Rite Aid Corporation; Walgreens;
and Walmart U.S. One retail pharmacy chain (The Kroger Co.) declined to participate.
Page 194
GAO-21-387

Health Disparities
The Centers for Disease Control and Prevention’s COVID-19 Response Health Equity Strategy
aims to address health disparities and inequities related to COVID-19, but lacks key elements
of a national strategy, and the agency does not have complete data on the race and ethnicity of
recipients of COVID-19 vaccinations.
Entities involved: Department of Health and Human Services, including the Centers for Disease
Control and Prevention.
Recommendations for Executive Action
The Director of the Centers for Disease Control and Prevention should incorporate key elements
of a national strategy in the agency’s COVID-19 Response Health Equity Strategy. These elements
include 1) speciﬁc actions to achieve intermediate outcomes, such as increased access to testing;
2) how intermediate outcomes should be prioritized within its four broad priority areas; 3)
who will implement actions to achieve intermediate outcomes; and 4) how the strategy relates
to other relevant strategies. The Centers for Disease Control and Prevention agreed with our
recommendation.
The Director of the Centers for Disease Control and Prevention should take steps to ensure more
complete reporting of race and ethnicity information for recipients of COVID-19 vaccinations, such
as working with states and jurisdictions to facilitate consistent collecting and reporting of this
information. The Centers for Disease Control and Prevention neither agreed nor disagreed with
our recommendation. The Centers for Disease Control and Prevention stated that it is working
to ensure more complete reporting of race and ethnicity information for recipients of COVID-19
vaccinations, such as by requiring providers that participate in CDC’s COVID-19 Vaccination
Program to report the race and ethnicity of vaccine recipients.
Key Considerations and Future GAO Work
In September 2020, to help address gaps in race and ethnicity data on COVID-19 indicators, we
recommended that the Director of the Centers for Disease Control and Prevention (CDC)
1. determine whether having the authority to require states and jurisdictions to report race
and ethnicity information for COVID-19 cases, hospitalizations, and deaths is necessary for
ensuring more complete data, and if so, seek such authority from Congress;
2. involve key stakeholders to help ensure the complete and consistent collection of
demographic data; and
3. take steps to help ensure its ability to comprehensively assess the long-term health outcomes
of persons with COVID-19, including by race and ethnicity.
CDC agreed with our recommendations. In response, in February 2021, CDC stated that it is
working with stakeholders from across the agency and state and local health departments
Page 195
GAO-21-387

to review the quality of demographic data, including the completeness of race and ethnicity
information, across CDC’s core surveillance systems. CDC added that the information derived from
this review will be discussed with the CDC Director and used to assess potential opportunities and
needs to enhance the collection of race and ethnicity data, including policy changes or legislative
authorities and whether that would potentially advance this work. In addition, CDC said that the
agency has various eﬀorts underway with external partners to assess long-term health outcomes.
Since September 2020, we also have identiﬁed concerns related to CDC’s health equity strategy
and its lack of data on the race and ethnicity of recipients of COVID-19 vaccinations. In addition, in
November 2020, we continued to ﬁnd gaps in data on indicators of COVID-19 burden by race and
ethnicity. We continue to conduct work examining the Department of Health and Human Services
(HHS), CDC, and other component agencies’ ongoing work regarding indicators of COVID-19,
disparities that may exist for various populations, and actions the federal government is taking to
help address such disparities.
Background
CDC has recognized the need to improve data collection and work with stakeholders to identify
and address COVID-19 related racial and ethnic disparities. In July 2020, CDC released its COVID-19
Response Health Equity Strategy, which aims to reduce health disparities by using data-driven
approaches to attain the highest level of health possible for all individuals, including communities
of color.271 CDC updated this strategy on August 21, 2020, and continues to use it to guide its
eﬀorts to improve the health outcomes of populations disproportionately aﬀected by COVID-19.
In October 2020, CDC released guidance to states and jurisdictions on how to plan and
operationalize vaccine distribution through an update to its COVID-19 Vaccination Program
Interim Playbook.272 The playbook speciﬁes that within 24 hours of administering a vaccine,
vaccine providers—such as medical doctors and pharmacists—are required to report information,
including recipient race and ethnicity, to the relevant state, local, or territorial public health
authority. According to the playbook, this information must be transmitted by jurisdictional
immunization information systems to the CDC on a regular basis. Provider records on vaccinations
also must be made available to federal, state, local, or territorial public health departments, to the
extent required by law.
In addition, the Consolidated Appropriations Act, 2021, enacted in December 2020, requires CDC
to submit a comprehensive COVID-19 vaccine distribution strategy to Congress that includes how
the agency will focus eﬀorts on high-risk and underserved populations, including communities of
color.273
271Centers for Disease Control and Prevention, CDC COVID-19 Response Health Equity Strategy: Accelerating Progress
Towards Reducing COVID-19 Disparities and Achieving Health Equity (July 22, 2020, updated August 21, 2020).
272Department of Health and Human Services, Centers for Disease Control and Prevention, COVID-19 Vaccination
Program Interim Playbook for Jurisdiction Operations, version 2.0 (Washington, D.C.: Oct. 29, 2020).
273Consolidated Appropriations Act, 2021, Pub. L. No. 116-260, div. M, tit. III, 134 Stat. 1182, 1912.
Page 196
GAO-21-387

On January 21, 2021, the White House released its National Strategy for the COVID-19 Response
and Pandemic Preparedness that directed HHS to increase the collection and reporting of health
data to identify high-risk communities, and to establish a system for monitoring long-term health
outcomes and understanding treatment needs, including for people of color.274 The strategy
includes a goal of protecting those most at risk for COVID-19 and advancing equity, including
across racial, ethnic and rural/urban communities.
In addition, President Biden signed two executive orders on January 21, 2021 focusing on ensuring
an equitable pandemic response by establishing a COVID-19 Health Equity Task Force, among
other things, and directing federal agencies responding to the COVID-19 pandemic to strengthen
equity-related data collection, reporting, and use.275
Overview of Key Issues
CDC data on race and ethnicity continue to be limited. We have previously reported, including
in our September and November 2020 reports on the federal response to COVID-19, that gaps
exist in data on indicators of COVID-19 by race and ethnicity. Available data on COVID-19 indicators
by race and ethnicity continue to be limited.
• Cases. As of March 8, 2021, race and ethnicity information was missing for 47.2 percent
of COVID-19 cases with case report forms received by CDC, or 59.9 percent of total cases
reported.276
• Hospitalizations. CDC’s hospitalization data for COVID-19 are limited to select counties in 14
states, and race and ethnicity information are not complete in the reported data.277
274The White House, National Strategy for the COVID-19 Response and Pandemic Preparedness (January 21, 2021).
275Exec. Order No. 13995, 86 Fed. Reg. 7,193 (Jan. 21, 2021); Exec. Order No. 13994, 86 Fed. Reg. 7,189 (Jan. 21, 2021).
276CDC oﬃcials reported that the number of cases with case report forms received by CDC is less than the total
number of reported cases because there is generally a 2-week lag from when total cases are reported by state
and jurisdictional health departments to when CDC receives the case report forms. Total cases reported by CDC
include both probable and conﬁrmed cases as reported by states or jurisdictions. A probable case does not have
conﬁrmatory laboratory evidence, but meets certain other criteria.
277COVID-NET collects data on COVID-19 hospitalizations that are conﬁrmed by laboratory testing from select
counties in 14 states, representing 10 percent of the U.S. population. It includes data from hospitals in select
counties in California, Colorado, Connecticut, Georgia, Iowa, Maryland, Michigan, Minnesota, New Mexico, New
York, Ohio, Oregon, Tennessee, and Utah. As of January 30, 2021, race and ethnicity were missing for 2.3 percent
of COVID-19-associated hospitalizations included in CDC’s COVID-19-Associated Hospitalization Surveillance
Network (COVID-NET). In addition to COVID-NET, HHS also collects national hospitalization data through its HHS
Protect Public Data Hub, https://protect-public.hhs.gov/, accessed February 23, 2021; however, HHS does not make
available data on COVID-19 hospitalizations by race and ethnicity through this website.
Page 197
GAO-21-387

• Deaths. Race and ethnicity data were missing for 25.3 percent of COVID-19-related deaths
with case report forms received by CDC, or 45.6 percent of total deaths reported through case
reporting, as of March 8, 2021.278
• Testing. Data on race and ethnicity were missing for 76 percent of COVID-19 laboratory tests as
of January 7, 2021.279
• Vaccinations. With the authorization of three vaccines for emergency use as of February 2021,
CDC is also collecting information on the race and ethnicity of individuals being vaccinated.
As of March 8, 2021, data collected from states and jurisdictions on race and ethnicity for
COVID-19 vaccine recipients were missing for almost half (46.7 percent) of recipients who
received at least one dose.
CDC data, though incomplete, continue to show disparities by race and ethnicity. We have
previously reported that communities of color have been disproportionately aﬀected by the
pandemic. Though limited, available data from CDC continues to demonstrate racial and ethnic
disparities in COVID-19 indicators.
• Cases. CDC race and ethnicity data on COVID-19 cases, while incomplete, demonstrate that
communities of color have been disproportionately aﬀected. Among cases with known race
and ethnicity reported to CDC as of March 8, 2021, 20.7 percent of cases were for persons
who were Hispanic or Latino (compared to 18.5 percent of the U.S. population), and 0.4
percent were Native Hawaiian or Other Paciﬁc Islander (compared to 0.2 percent of the U.S.
population).280
• Hospitalizations. CDC data indicate that communities of color are disproportionately
hospitalized with COVID-19 in select counties in 14 states included in CDC’s COVID-NET.
According to CDC’s analysis of this data, between March 1, 2020, and January 30, 2021
American Indian/Alaska Native persons were hospitalized with COVID-19 at a rate 3.6 times
that of non-Hispanic White persons. Hispanic or Latino persons were hospitalized at a rate 3.2
times that of non-Hispanic White persons, and non-Hispanic Black persons were hospitalized
at a rate 2.9 times that of non-Hispanic White persons when adjusting for age.
278CDC oﬃcials noted that the number of deaths with case report forms it has received is less than the total
number of reported deaths through case reporting because there is generally a 2-week lag from when total deaths
are reported by state and jurisdictional health departments to when CDC receives case report forms noting deaths.
CDC also makes data available on COVID-19 deaths from death certiﬁcate data through its National Vital Statistics
System (NVSS). CDC stated that over 99 percent of deaths in NVSS have race and ethnicity information.
279CDC data represent viral COVID-19 laboratory test results from laboratories in the U.S., including commercial
laboratories, public health laboratories, and other testing locations from 48 jurisdictions. The data represent total
laboratory tests, not individual people, and exclude antibody and antigen tests.
280Additionally, among cases with known race and ethnicity reported to CDC as of March 8, 2021, 12.2 percent
were non-Hispanic Black (compared to 13.4 percent of the U.S. population), 3.6 percent were non-Hispanic Asian
(compared to 5.9 percent of the U.S. population), 1.2 percent were American Indian/Alaska Native (compared to 1.3
percent of the U.S. population), and 56.0 percent were non-Hispanic White persons (compared to 60.1 percent of
the U.S. population).
Page 198
GAO-21-387

• Deaths. As of January 6, 2021, CDC’s National Center for Health Statistics (NCHS) data show
that non-Hispanic American Indian/Alaska Native persons died of COVID-19 at a rate 1.6 times
higher than non-Hispanic White persons. Non-Hispanic Black persons died of COVID-19 at a
rate 1.4 times higher than non-Hispanic White persons.281
• Testing. Among COVID-19 diagnostic test results reported to CDC from laboratories from 48
jurisdictions as of January 7, 2021, with race and ethnicity information, the percent of tests
that were positive by each racial and ethnic group was: 17.9 percent for Hispanic or Latino
persons, 13.2 percent for non-Hispanic Native Hawaiian or Other Paciﬁc Islander persons, 12.4
percent for non-Hispanic American Indian/Alaska Native, and 11.2 percent for non-Hispanic
Black persons, compared to 9.5 percent for non-Hispanic White persons.282
• Vaccinations. Although limited, existing data showed disparities by race and ethnicity in
vaccine recipients who received at least one dose whose race and ethnicity was known as of
March 8, 2021: 65.4 percent of those receiving at least one vaccine dose were non-Hispanic
White (compared to 60.1 percent of the U.S. population), 8.5 percent were Hispanic or Latino
(compared to 18.5 percent of the U.S. population), 7.1 percent were non-Hispanic Black
(compared to 13.4 percent of the U.S. population), and 4.7 percent were non-Hispanic Asian
(compared to 5.9 percent of the U.S. population).283
CDC equity strategy lacks key elements of an eﬀective national strategy. On July 22, 2020,
CDC released a COVID-19 Response Health Equity Strategy to accelerate progress toward reducing
disparities in indicators of COVID-19 burden, among other eﬀorts to achieve health equity,
including intermediate outcomes. In the strategy, CDC provides intermediate outcomes within
four broad priority areas that it plans to achieve within 3-12 months.284 For example, related to
281Department of Health and Human Services, Centers for Disease Control and Prevention. Report to Congress on
Paycheck Protection Program and Health Care Enhancement Act Disaggregated Data on U.S. Coronavirus Disease 2019
(COVID-19) Testing, 8th 30-Day Update (January 2021).
282Department of Health and Human Services, Centers for Disease Control and Prevention. Report to Congress
on Paycheck Protection Program and Health Care Enhancement Act Disaggregated Data on U.S. Coronavirus Disease
2019 (COVID-19) Testing, 8th 30-Day Update (January 2021). CDC data represent viral COVID-19 laboratory test
results from laboratories in the U.S., including commercial laboratories, public health laboratories, and other
testing locations from 48 jurisdictions. The data represent total laboratory tests, not individual people, and exclude
antibody and antigen tests. (See our related Funding for COVID-19 Testing enclosure for additional information.)
283CDC COVID Data Tracker, https://covid.cdc.gov/covid-data-tracker/#vaccination-demographic, accessed March
9, 2021. Data from CDC’s COVID Data Tracker also indicated that 1.7 percent of COVID-19 vaccine recipients who
received at least one dose whose race and ethnicity was known as of March 8, 2021 were non-Hispanic American
Indian/Alaska Native (compared to 1.3 percent of the U.S. population), 0.3 percent were non-Hispanic Native
Hawaiian or Other Paciﬁc Islander (compared to 0.2 percent of the U.S. population), and 12.3 percent were non-
Hispanic Multiple/Other races (compared to 2.8 percent of the U.S. population). In addition, in February 2021,
CDC released a report assessing the demographic characteristics of persons who received the COVID-19 vaccine
from December 14, 2020 through January 14, 2021, and found that it is critical to ensure eﬃcient and equitable
administration of the vaccine to persons at highest risk for infection and severe health outcomes. See Centers for
Disease Control and Prevention, Morbidity and Mortality Weekly Report, Vol. 70, No. 5 (February 5, 2021).
284The four broad priority areas of CDC’s equity strategy are (1) expand the evidence base; (2) expand programs
and practices for testing, contact tracing, isolation, healthcare, and recovery from the impact of unintended negative
consequences of mitigation strategies in order to reach populations that have been put at increased risk; (3) expand
Page 199
GAO-21-387

expanding programs and practices for testing, one intermediate outcome consists of increasing
access to testing for populations at increased risk of COVID-19.
We found that CDC’s equity strategy does not include several key elements of a national strategy,
as deﬁned by our prior work, including the following:
1. speciﬁc actions to achieve intermediate outcomes;
2. how intermediate outcomes should be prioritized within its four broad priority areas;
3. who will implement actions to achieve intermediate outcomes; and
4. how the strategy relates to other relevant strategies.285
For example, CDC’s strategy includes an intermediate outcome to increase access to testing for
populations at increased risk for COVID-19. However, CDC’s strategy does not provide speciﬁc
actions that the agency will take to determine whether or where it needs to increase access to
testing for populations at increased risk for COVID-19—an essential ﬁrst step before taking steps
to increase testing access. Further, CDC does not specify how its intermediate outcomes should
be prioritized amongst the other intermediate outcomes. In addition, the strategy does not specify
who will implement actions to achieve these intermediate outcomes, such as speciﬁc program
oﬃces within CDC. Lastly, the strategy does not specify how it relates to other relevant strategies,
such as HHS’s Testing Strategy Report and the National Strategy for the COVID-19 Response and
Pandemic Preparedness.286
Our prior work sets forth several key elements of strategies that can guide agencies in planning
and implementing an eﬀective national strategy. As noted in our prior work, these elements
include identifying speciﬁc actions, specifying how such actions should be prioritized, designating
who will be implementing these actions, and indicating how a strategy relates to other strategies,
such as those noted above.287 These elements can be used to gauge progress when implementing
programs and to determine whether adjustments need to be made in order to maintain progress
within given time frames.
CDC stated that its equity strategy does not include these elements because they intended the
strategy to be a broad and high-level framework of the activities necessary to improve the health
program and practice activities to support essential and frontline workers to prevent transmission of COVID-19; and (4)
expand an inclusive workforce equipped to assess and address the needs of an increasingly diverse U.S. population.
285GAO, Combating Terrorism: Evaluation of Selected Characteristics in National Strategies Related to Terrorism,
GAO-04-408T (Washington, D.C.: Feb. 3, 2004). This report identiﬁes the key elements of a national strategy.
286See Department of Health and Human Services, Report to Congress: COVID-19 Strategic Testing Plan Second Update
(November, 2020). As part of this plan, HHS reported that it aims to protect and improve health outcomes among
populations at higher risk for COVID-19. In January 2021, we recommended that HHS should develop and make publicly
available a comprehensive national COVID-19 testing strategy that incorporates all six characteristics of an eﬀective
national strategy. Such a strategy could build upon existing strategy documents that HHS has produced for the public
and Congress to allow for a more coordinated pandemic testing approach. See GAO-21-265.
287 GAO-04-408T.
Page 200
GAO-21-387

outcomes of populations disproportionately aﬀected by COVID-19. CDC oﬃcials added that
because there was still so much to learn about COVID-19 when the strategy was developed, it
was important to keep the strategy high level to allow room to pivot and adapt activities based on
science and relevant data. CDC maintains an internal document to track progress on achieving the
outcomes within CDC’s health equity strategy.
As CDC moves forward with implementing its equity strategy, it will be important for the agency to
include several key elements of a national strategy, including the following actions:
• Develop speciﬁc actions and priorities to facilitate the measurement of progress towards its
intermediate outcomes. For example, by taking speciﬁc actions to determine the extent to
which it needs to expand testing access, CDC may be better positioned to target its eﬀorts to
speciﬁc communities of color that lack access to testing.
• Designate who will be implementing these actions, such as speciﬁc program oﬃces within
CDC. This will help CDC clarify roles and responsibilities and coordinate eﬀorts across the
agency.
• Take steps to identify how CDC’s strategy is relevant to other strategies. By doing so, CDC
can determine how the strategy’s scope complements, expands upon, or overlaps with other
strategies.
By including the key elements we identiﬁed, CDC can better ensure the eﬀective implementation
of its equity strategy to help it improve the health outcomes of populations disproportionately
aﬀected by COVID-19, including communities of color. Additionally, as the federal government
releases additional strategies to improve its response to the COVID-19 pandemic, it will be
imperative for CDC to consider these strategies in relation to CDC’s equity strategy to facilitate a
coordinated federal response.
Improving completeness of race and ethnicity data for COVID-19 vaccinations critical to
federal eﬀorts to advance equity. CDC requires providers administering COVID-19 vaccines to
report the race and ethnicity of vaccine recipients, among other things, to relevant state, local,
or territorial public health authorities, and must be transferred by jurisdictions to CDC. However,
as noted, according to CDC, data collected from states and jurisdictions on race and ethnicity for
COVID-19 vaccine recipients who received at least one dose was missing for almost half (46.7
percent) of recipients as of March 8, 2021.288
In its COVID-19 Response Health Equity Strategy, CDC reported that it aims to reach
disproportionately aﬀected communities through eﬀective vaccination strategies and plans to
collect and report timely, complete, and representative data on COVID-19 vaccinations. Similarly,
the January 2021 National Strategy for the COVID-19 Response and Pandemic Preparedness states
288CDC COVID Data Tracker, https://covid.cdc.gov/covid-data-tracker/#vaccination-demographic, accessed March 9,
2021.
Page 201
GAO-21-387

the importance of collecting and reporting data by race and ethnicity to inform COVID-19 response
eﬀorts, including equitable vaccine distribution.289
CDC stated that information on race and ethnicity for COVID-19 vaccine recipients is missing for
a variety of reasons, including a lack of consistent collection and reporting of this information
by physicians and pharmacists and challenges with transmitting data to CDC. Oﬃcials from
two of the three selected states we interviewed said that it can be challenging to collect this
information when administering COVID-19 vaccinations because recipients may refuse to provide
their race and ethnicity at the time of vaccination, among other things. Stakeholders indicated that
challenges with collecting race and ethnicity for indicators of COVID-19 burden, such as cases, can
also aﬀect the collection of race and ethnicity for COVID-19 vaccination recipients, such as the lack
of reporting race and ethnicity information by providers and the use of broad race and ethnicity
categories.290 The lack of consistent collection and reporting of information on race and ethnicity
is a persistent problem, as we previously reported. CDC oﬃcials stated that ongoing support for
health care providers will be needed to help ensure the complete and consistent collection and
reporting of race and ethnicity information.
Without complete information on the race and ethnicity of persons who have received COVID-19
vaccines, CDC may have diﬃculty determining whether vaccines are distributed equitably to
communities of color who have been disproportionately aﬀected by COVID-19. As noted, recent
data from CDC, while limited, suggest disparities exist by race and ethnicity in COVID-19 vaccine
recipients. Further, in the absence of more complete data, CDC does not know whether it is
eﬀectively meeting its aim to reach disproportionately aﬀected populations with vaccination
strategies.
Obtaining more complete information on the race and ethnicity of COVID-19 vaccine recipients
would help inform CDC’s eﬀorts to develop strategies to ensure the equitable distribution of
vaccinations, such as initiating culturally and linguistically tailored programs. These strategies may
be particularly important for communities of color, as several studies have shown that persons in
various racial and ethnic groups may be more hesitant about receiving COVID-19 vaccinations.291
289In addition, the January 2021 executive order on equitable pandemic response directed federal agencies to assess
plans and policies to determine whether resources, including vaccines, have been or will be allocated equitably. Exec.
Order No. 13995, 86 Fed. Reg. 7,193 (Jan. 21, 2021).
290We interviewed or received written responses from stakeholders including the American Hospital Association,
the American Medical Association, the American Public Health Association, American Pharmacists Association, the
Association of State and Territorial Health Oﬃcials, and the National Association of County and City Health Oﬃcials.
These stakeholders were selected for a variety of reasons including their representation of entities involved in COVID-19
testing and vaccination eﬀorts. We previously reported challenges with collecting race and ethnicity for indicators of
COVID-19 burden, such as providers not collecting demographic information from patients at the point of care and
state and jurisdictional health departments combining certain racial and ethnic groups into an “Other” category. See
GAO-20-701.
291For example, see Langer Research Associates, COVID Collaborative Survey: Coronavirus Vaccination Hesitancy in the
Black and Latinx Communities (November 2020).
Page 202
GAO-21-387

Agency Comments
We provided HHS, CDC, and the Oﬃce of Management and Budget (OMB) with a draft of this
enclosure. CDC provided technical comments on this enclosure, which we incorporated as
appropriate. HHS also provided general comments which are reproduced in Appendix VI:
Comments from the Department of Health and Human Services. OMB did not provide comments
on this enclosure.
CDC agreed with our recommendation to incorporate key elements of a national strategy
in its COVID-19 Response Health Equity Strategy. CDC neither agreed nor disagreed with
our recommendation to take steps to ensure more complete reporting of race and ethnicity
information for recipients of COVID-19 vaccinations. In response to our recommendations, CDC
stated that it will take steps to include key elements of a national strategy in an internal version of
its COVID-19 Response Health Equity Strategy to help with coordination and tracking, among other
actions to coordinate health equity activities across various task forces and with federal, state, and
local partners. In addition, CDC stated that it is working to ensure more complete reporting of race
and ethnicity information for recipients of COVID-19 vaccinations, such as by requiring providers
that participate in CDC’s COVID-19 Vaccination Program to report the race and ethnicity of vaccine
recipients.
Methodology
To conduct this work, we reviewed CDC’s reported data on COVID-19, reviewed federal laws,
agency guidance and documentation, and interviewed or obtained written responses from HHS
and CDC oﬃcials.
To assess HHS’s eﬀorts, including CDC’s, related to CDC’s equity strategy and COVID-19 vaccine
distribution for communities of color, we reviewed HHS and CDC documentation, including reports
to Congress and strategic planning documents, and interviewed or obtained written responses
from HHS and CDC oﬃcials. We also conducted interviews and reviewed written responses
provided by organizations that represent entities involved in COVID-19 testing and vaccination
eﬀorts and from state public health oﬃcials from three selected states—Alabama, Nevada, and
South Dakota—to obtain their perspectives on federal agency actions and challenges.292 We
compared HHS’s eﬀorts to our prior work on key elements of strategies for eﬀective government
programs and standards for data collection within CDC’s COVID-19 Vaccination Program Interim
Playbook.
To assess the reliability of the data on COVID-19 indicators we analyzed, we obtained written
responses from CDC and HHS; reviewed related documentation; and reviewed the data to identify
292We interviewed or received written responses from stakeholders including the American Hospital Association,
the American Medical Association, the American Public Health Association, American Pharmacists Association, the
Association of State and Territorial Health Oﬃcials, and the National Association of County and City Health Oﬃcials.
These stakeholders were selected for a variety of reasons including their representation of entities involved in COVID-19
testing and vaccination eﬀorts. We selected three states—Alabama, Nevada, and South Dakota—based on the relative
percentage of persons in racial and ethnic groups residing in the states compared to the national distribution, the
COVID-19 case rate per 100,000 people in the last 7 days as of December 9, 2020, and variation in geographic region.
Page 203
GAO-21-387

obvious errors or omissions. On the basis of these steps, we determined that the data were
suﬃciently reliable for the purpose of analyzing COVID-19 data.
Contact information: Alyssa M. Hundrup, (202) 512-7114, hundrupa@gao.gov
Related GAO Products
COVID-19: Federal Eﬀorts Accelerate Vaccine and Therapeutic Development, but More Transparency
Needed on Emergency Use Authorizations. GAO-21-207. Washington, D.C.: November 17, 2020.
COVID-19 Data Quality and Considerations for Modeling and Analysis. GAO-20-635SP. Washington,
D.C.: July 30, 2020.
Page 204
GAO-21-387

Defense Production Act
Federal agencies continue to use the Defense Production Act, among other actions, to prioritize
contracts, expand domestic production for medical supplies and COVID-19 vaccines, and
collaborate with industry.
Entities involved: Department of Health and Human Services, Department of Defense, and
Federal Emergency Management Agency
Key Considerations and Future GAO Work
The President issued an executive order in January 2021 that requires federal agencies to conduct
assessments of domestic supply and demand for medical supplies, address any identiﬁed
shortfalls through the Defense Production Act (DPA) and other actions, and develop a longer term
strategy for the domestic production of medical supplies.293 In March 2021 the American Rescue
Plan Act appropriated $10 billion in support of the use of the DPA for medical supplies.294
We believe the DPA can be a powerful tool for federal agencies to mitigate medical supply chain
issues and previously made recommendations to the Secretary of Health and Human Services
(HHS) and the Oﬃce of Management and Budget related to the use of DPA and other actions to
increase domestic production of medical supplies. Speciﬁcally:
• In September 2020, we recommended that the Secretary of HHS—in coordination with the
Federal Emergency Management Agency (FEMA)—should further develop and communicate to
stakeholders plans outlining speciﬁc actions the federal government will take to help mitigate
remaining medical supply gaps necessary to respond to the remainder of the pandemic,
including through the use of DPA authorities. HHS disagreed with this recommendation, but
we continue to believe this action is necessary to improve the federal government’s response
to COVID-19.
• In November 2020, we recommended that HHS identify how the DPA and other actions will be
used to increase production of domestic medical supplies. HHS agreed, but has not yet taken
steps to implement the recommendation.
• In November 2020, we recommended that the Oﬃce of Management and Budget develop
reporting guidance to provide more transparency on the use of DPA Title I authorities to
place priority ratings on contracts. The Oﬃce of Management and Budget concurred with this
recommendation, but has not yet taken actions to implement it.
We will monitor agency actions with regard to domestic production of medical supplies in future
work, including a review of the personal protective equipment (PPE) supply chain.
293 A Sustainable Public Health Supply Chain, Exec. Order No. 14001, 86 Fed. Reg. 7219 (Jan. 26, 2021).
294American Rescue Plan Act of 2021, Pub. L. No. 117-2, § 3101, 135 Stat. 4, 53-54.
Page 205
GAO-21-387

Background
During the Korean War, Congress enacted the Defense Production Act of 1950 to ensure the
availability of industrial resources to meet the Department of Defense’s (DOD) needs.295 There are
three major DPA authorities currently in eﬀect: Titles I, III, and VII.
• Title I: Priorities and Allocation Authority authorizes the President to require priority
performance on contracts or orders and allocate materials, services, and facilities as necessary
or appropriate to promote the national defense. This authority allows priority-rated contracts
or orders to take preference over any other unrated contracts or orders if a contractor cannot
meet all required delivery dates.296
• Title III: Expansion of Domestic Capacity and Supply authorizes the President to provide
various ﬁnancial incentives to ﬁrms to meet a variety of national defense goals, including
maintaining, restoring, and expanding the domestic industrial base. The ﬁnancial incentives
may be used only when certain conditions are met.
• Title VII: General Provisions provides for a range of authorities, including antitrust
protections for activities carried out under voluntary agreements for preparedness programs
and protecting individuals and companies who carry out the voluntary agreement from certain
lawsuits brought by other customers.
We reported in November 2020 that HHS and FEMA had placed priority ratings on 25 contracts
for ventilators, N95 respirators, and other medical supplies to respond to COVID-19. In January
2021, we reported that HHS and DOD had awarded 32 domestic production expansion projects
totaling approximately $1.4 billion through DPA and other actions for medical supplies.297 FEMA
also created a voluntary agreement in August 2020 focused on the manufacturing and distribution
of medical supplies to respond to COVID-19 and future pandemics. FEMA began holding meetings
with industry in October 2020 to solicit feedback on the next steps under the agreement.
This enclosure provides an update on federal agencies’ use of DPA authorities for medical
supplies, and also includes data on vaccines and therapeutics.
Overview of Key Issues
Federal agencies continued to place priority ratings on contracts to respond to COVID- 19.
HHS, FEMA, and DOD used DPA Title I authorities to place priority ratings on 44 medical supply-,
295Pub. L. No. 81-774 (1950), codiﬁed at 50 U.S.C. §§ 4501 et seq., as amended.
296Title I of the DPA also enables agencies to issue three types of allocation orders that require a person or
corporation to (1) reserve resource capacity in anticipation of a rated order; (2) take or refrain from taking certain
actions or divert the use of materials, services, or facilities from one purpose to another; or (3) limit the amount of a
resource to be used for a speciﬁc purpose.
297“Other” actions refer to those identiﬁed by DOD that have similar goals of industrial base expansion for medical
supplies but are not executed under the DPA Title III authority.
Page 206
GAO-21-387

therapeutics, and vaccine-related contracts as of February 28, 2021. As shown in the ﬁgure below,
from March through August 2020, agencies generally placed priority ratings on contracts for
medical supplies, such as N95 respirators. From August through February 2021 agencies reported
placing priority ratings on vaccine contracts, as well as on contracts for therapeutics and vaccine
supplies such as vials.
Priority-Rated Actions by Supply Type, March 2020–February 2021
aMedical supplies include N95 respirators, ventilators, air purifying respirators, and goggles.
bVaccine supplies include syringes, vials, manufacturing equipment, and other items necessary to support the production and
delivery of COVID-19 vaccines.
cAll six vaccine manufacturers received priority ratings. As of February 2021 three of the vaccines have received emergency use
authorization from the Food and Drug Administration. The remaining three are undergoing clinical trials.
dTherapeutics being purchased include monoclonal antibodies, which are laboratory-made antibodies that may potentially be
used to prevent or treat COVID-19 infection. According to oﬃcials, as of February 2021 ﬁve therapeutics manufacturers received
priority ratings. As of February 2021, two of ﬁve therapeutics have received emergency use authorization from the Food and
Drug Administration. The remaining three are undergoing clinical trials.
Federal agencies reported receiving a majority of the N95 respirators, ventilators, air purifying
respirators, and goggles that were on priority-rated contracts. For example, federal agencies
reported receiving 60 percent of the N95 respirators and 100 percent of the goggles that were on
priority-rated contracts.
In addition, as of February 28, 2021, the Centers for Disease Control and Prevention reported
distributing over 96 million doses of Pﬁzer and Moderna vaccines. The government announced
the purchase of a total of 600 million doses from these two contractors, which are expected by the
end of July 2021. Additional information on vaccines can be found in our forthcoming report.
We interviewed representatives from three medical supply companies and obtained written
responses from six vaccine manufacturers that received DPA Title I rated contracts to obtain their
observations about the beneﬁts of priority ratings. Representatives from these organizations
generally said that the priority rating gave them timely access to raw materials and supplies. For
example, one company representative said that demand had increased signiﬁcantly for meltblown
material—a raw material for N95 respirators and ventilators—in the spring of 2020. The company
was able to place priority-rated orders to its meltblown material manufacturer to ensure it could
meet the contractual delivery date.
HHS and DOD are increasing the domestic production of medical supplies, but challenges
remain in addressing national demand. Federal agencies have made approximately $2.3 billion
Page 207
GAO-21-387

of investments in domestic production expansion projects through DPA and other actions. As
shown in the table below, as of February 28, 2021, agencies were executing 42 projects to address
shortages of PPE and related material, testing material, and vaccine supplies.
Page 208
GAO-21-387

Medical Supply Domestic Production Expansion Projects, through February 2021
Medical supply
Number of projects
Projected annual production
increase a
(items, millions)
Personal protective equipment
N95 respirators
4
690
Gloves
1
450
Surgical masks
2
532
Gowns
1
1.5
Materials for personal protective equipment and
ventilators
Ventilator components
1
7.8
Filter mediab
4
for N95 respirators
1,457
for ventilators
330
for surgical masks
4,344
Testing materials
Swabsticks
1
1,200
Swabs
5
3,388.8
Test and test kits
9
Over 995
Pipette tips
2
1,164
Vaccine supplies
Syringes
4
1,417
Vials
2
284
Fill ﬁnish capacity (doses)
1
300
Pharmaceuticals and other c
5
N/A
Source: GAO analysis of Department of Defense and Department of Health and Human Services data and interviews with agency oﬃcials. I GAO-21-387
aAnnual increase is the projected quantity a contractor will produce in 1 year once full rate of production is reached.
bFilter media prevents virus particles from passing through the air and is designed speciﬁcally for N95 respirators, surgical
masks, and ventilators. Some of the agreements stated that the ﬁlter media can be used either for surgical masks or
respirators.
Page 209
GAO-21-387

cThree projects are supporting development of a manufacturing technology and do not have an associated full rate of
production, and two others did not have a deﬁned full rate of production.
Nine projects were expected to reach full-rate production—an increased rate achieved after
domestic expansion projects are fully implemented —as of February 28, 2021. The remainder
with deﬁned full rates are expected to achieve full-rate production from March 2021 through
September 2022.
However, the federal government has determined that some supply gaps still exist. In January
2021, the National Strategy for the COVID-19 Response and Pandemic Preparedness identiﬁed
12 medical supplies with immediate shortfalls, including N95 respirators, isolation gowns, nitrile
gloves, sample collection swabs, pipette tips, rapid test kits, and low dead-space needles and
syringes.
The federal government has since announced actions to address shortfalls for some of these
items. On February 5, 2021, White House oﬃcials announced six investments to expand the
domestic supply of test kits by approximately 60 million by the end of summer 2021 and
additional projects to expand production of nitrile gloves to 1 billion per month by December
2021. According to a White House oﬃcial, domestic suppliers will be able to meet about half of
the U.S. demand for nitrile gloves once these expansion projects are completed. The oﬃcial stated
that the government was negotiating these contracts and that they would be ﬁnalized at a later
date. As of February 28, 2021, these contracts had not been ﬁnalized.
Additional priority ratings and domestic production expansion projects may be forthcoming as
agencies implement a January 2021 executive order pertaining to sustaining the public health
supply chain.298 The executive order requires federal agencies, including DOD and HHS, to
immediately complete assessments of the availability of medical supplies and the capacity of
domestic companies to produce those supplies. It requires agencies to address any supply
shortfalls through the DPA or other legal authorities, and provide a report to the White House’s
COVID-19 coordinator.
Representatives from the medical supply companies we interviewed told us the following about
beneﬁts they had obtained from receiving funding for a domestic production expansion project:
• Representatives from ﬁve companies said the funding allowed their companies to expand
production faster than they could have on their own. Three representatives further stated
that their companies would not have made the investments to expand production without
receiving government funding.
• Some of the companies used the funding to expand their facilities or acquire additional
machinery. For example, one company used government funding to acquire nearly 100,000
298Exec. Order No. 14001, 86 Fed. Reg. 7219 (Jan. 26, 2021). Another executive order, Organizing and Mobilizing the United
States Government to Provide a Uniﬁed and Eﬀective Response to Combat COVID-19 and to Provide United States Leadership
on Global Health and Security, established the position of Coordinator of the COVID-19 Response to report directly to the
President and coordinate federal eﬀorts to produce, supply, and distribute medical supplies, including through the use
of the DPA, among other things. Exec. Order No. 13987, 86 Fed. Reg. 7019 (Jan. 25, 2021).
Page 210
GAO-21-387

square feet of production space. Another company used the funding to acquire new
machinery and double its domestic production capacity.
• Five companies hired additional personnel as they expanded production. These companies
reported hiring between 90 and 650 new employees.
• A representative from one company said that DOD took actions to help them maintain the
schedule. The representative told us that DOD helped the company identify a new supplier
to provide a special type of equipment necessary for expanding production. Additionally, the
representative told us that DOD coordinated with an embassy to expedite the delivery of
machinery from a foreign supplier
Federal agencies are leveraging Title VII authorities to share information and coordinate
the distribution of PPE. On December 8, 2020, FEMA published a plan through its Title VII
agreement to bring together manufacturers and distributers of PPE and coordinate their eﬀorts.
This plan is expected to allow federal agencies, including FEMA, DOD, and HHS, to gather data
from private-sector representatives to inform the government’s demand estimates for PPE, and
coordinate actions to distribute supplies, among other things. Under Title VII of the DPA, antitrust
protections are available for activities carried out under a voluntary agreement.
Under this plan, FEMA created ﬁve subcommittees that are focused on a speciﬁc issue or supply
item. One subcommittee is focused on deﬁning PPE requirements, including the domestic demand
for PPE.299 The remaining four subcommittees are focused on N95 and other medical respirators,
gowns, eye and facial coverings, and gloves. According to FEMA oﬃcials, in December 2020, the
PPE requirements subcommittee developed a 90-day action plan to begin addressing PPE supply
concerns. This plan includes eﬀorts to address the supply of raw materials needed for domestic
production, and communicate decontamination strategies to extend the life of current PPE, among
other things.300
At a recent public meeting, FEMA oﬃcials stated that FEMA expects to release another plan
focused on testing in early 2021.
Federal agencies are taking action to address challenges in executing DPA authorities. HHS
and FEMA oﬃcials, as well as medical supply company representatives we interviewed identiﬁed
challenges that they had experienced while executing DPA authorities. HHS and FEMA have taken
steps to address some challenges.
Agencies took steps to address company concerns about the complexity of the procurement process. All
of the company representatives we spoke with said their companies experienced some problems
navigating the federal government’s procurement process, such as developing and submitting
white papers to propose a project, negotiating the ﬁnal terms and conditions of their contracts or
299The subcommittees are led by FEMA oﬃcials and staﬀed with federal agency and private-sector representatives.
According to the plan, FEMA can add additional subcommittees if they (1) cover a speciﬁc, well-deﬁned PPE area and (2)
are recommended to be added by the subcommittee in charge of deﬁning requirements.
300FDA has authorized decontamination units, which use ultraviolet germicidal irradiation, hydrogen peroxide vapor, or
steam cleaning, to decontaminate N95 respirators to allow health workers to reuse them in clinical environments.
Page 211
GAO-21-387

agreements, and submitting invoices for payment.301 In addition, some representatives said their
companies had little or no previous experience working with the government. They also indicated
that agency oﬃcials have been responsive to their questions and were able to assist them or are
working to address their problems.
Some commercial companies experienced challenges obtaining a priority rating. HHS’s DPA oﬃce
developed documents in December 2020 to guide companies through the process of requesting
a priority rating. Operation Warp Speed oﬃcials also provided training to companies that received
priority ratings on how to apply those ratings to subcontracts with their suppliers.
Agencies are considering the eﬀects of priority ratings on supply chains. Federal agencies recognized
the importance of maintaining awareness of the eﬀect of priority ratings on suppliers. An HHS
oﬃcial noted that this stemmed from actions taken by agencies early in the pandemic that
resulted in priority ratings being placed on multiple ventilator and N95 respirator contracts.
Ventilators and N95 respirators share a common raw material—meltblown fabric—that the oﬃcial
said more than ten companies with priority ratings were trying to obtain at the same time. HHS
oﬃcials worked with the ventilator and N95 companies to identify alternative suppliers and
methods for producing meltblown fabric to avoid material shortages. DOD also awarded domestic
production expansion projects to increase the supply of this material.
The HHS Acting DPA Program Oﬃce supervisor stated that to avoid similar issues for other types
of supplies, HHS, DOD, FEMA, the Department of Commerce, and other agencies have been
meeting weekly since the spring of 2020 to discuss the potential eﬀect of priority ratings on the
supply chain. HHS’s DPA Program Oﬃce also developed a template to help employees assess
the potential eﬀect of priority rating requests, such as the impact to other contracts or subtier
suppliers.
HHS and FEMA have identiﬁed gaps in DPA expertise. In June 2020, HHS oﬃcials said the
department’s contracting workforce had limited experience with, and training on DPA authorities.
According to HHS oﬃcials, HHS recently took steps to improve its ability to use DPA authorities or
other actions to increase domestic production of medical supplies. For example, an HHS oﬃcial
told us that a DPA oﬃce was created within the oﬃce of the Assistant Secretary for Preparedness
and Response in 2020. The oﬃce, which is expected to have four full-time staﬀ, is responsible
for coordinating the use of DPA authorities, sharing knowledge, and processing priority rating
requests. According to an oﬃcial in the oﬃce of the Assistant Secretary for Preparedness and
Response, HHS also created an Industrial Base Expansion program oﬃce that will manage
requirements for medical domestic production expansion projects.
FEMA also identiﬁed gaps in its DPA expertise. The agency published a self-assessment of its
response to the COVID-19 pandemic in January 2021, which identiﬁed as a major operational
gap the lack of trained, permanent personnel with expertise to address technical supply chain
301The Department of Defense can authorize contractors to begin work and incur costs before reaching ﬁnal agreement
on contract terms, speciﬁcations, or price, using an undeﬁnitized contract action or agreement. The contract or
agreement is deﬁnitized once the ﬁnal terms and conditions are agreed to by all parties. The contracts or agreements
our selected companies received were generally awarded undeﬁnitized.
Page 212
GAO-21-387

issues.302 Speciﬁcally, it noted that the FEMA DPA Program Oﬃce consists of four full-time
employees. The team was given 26 additional federal employees during the COVID response, but
only some were familiar with DPA authorities and many required DPA training. FEMA’s assessment
recommended taking steps to identify personnel to support the DPA oﬃce, such as developing a
plan to recruit and train identiﬁed positions or formalize an interagency process to allow staﬀ with
DPA expertise from other federal agencies to support FEMA.
The federal government is evaluating its future role regarding the domestic production of
medical supplies. The COVID-19 pandemic highlighted the shortcomings of U.S. dependence
on foreign sources for many medical supplies, including gowns and nitrile gloves. It has also
highlighted the beneﬁts the federal government could achieve by using DPA and similar actions to
expand domestic production of medical supplies to address some of these shortcomings.
The federal government is currently evaluating what actions it will take in the future with regard to
domestic production of medical supplies. Speciﬁcally, the January 2021 executive order mentioned
earlier also requires agencies to develop a strategy by July 2021 to design, build, and sustain
a medical domestic production capability, and create a multiyear implementation plan for the
domestic production of medical supplies.303
It is too early to assess what speciﬁc actions will be taken in response to this executive order.
Agency oﬃcials we spoke with identiﬁed several examples of how the federal government could
help sustain medical domestic production capacity, including establishing a dedicated budget line
for industrial base investment, helping companies enter into new markets, or entering into long-
term procurement contracts with manufacturers, similar to how DOD maintains production with
key suppliers of some weapon systems.
We believe that as part of the response to this executive order, HHS should also implement our
recommendation from November 2020 to identify how the DPA and similar actions will be used to
increase production of domestic medical supplies.
Agency Comments
We provided a draft of this enclosure to DOD, FEMA, HHS, and the Oﬃce of Management and
Budget (OMB) for review and comment. FEMA and HHS provided technical comments that we
incorporated as appropriate. DOD and OMB did not provide comments on this enclosure.
Methodology
To identify agencies’ use of DPA Title I actions, we reviewed agency announcements and
interviewed relevant oﬃcials. To identify agencies’ use of DPA Title III and similar actions, we
reviewed Federal Procurement Data System-Next Generation (FPDS) data and DOD and HHS
302Federal Emergency Management Agency, Pandemic Response to Coronavirus Disease (COVID-19) Initial Assessment
Report. January 2021.
303Exec. Order No.14001, 86 Fed. Reg. 7219 (Jan. 26, 2021).
Page 213
GAO-21-387

documentation. To assess DPA Title VII actions, we analyzed FEMA documentation and interviewed
key FEMA and other relevant federal agency oﬃcials. We solicited contractor perspectives by
conducting semistructured interviews with representatives from six companies that had received
DPA Title I priority-rated contracts, were executing a domestic production expansion project, or
both. We selected those companies because they vary in size, federal contracting experience,
and the type of products they produce. We also solicited written responses from all six COVID-19
vaccine manufacturers that received priority-rated contracts. Contractor perspectives are not
generalizable to all contractors. We cross-referenced FPDS and agency data against contract
announcements and in interviews with various agency and private industry representatives and
determined that the data were suﬃciently reliable for the purposes of describing agencies’ use of
the DPA in response to COVID-19.
Contact information: William Russell, (202) 512-4841, RussellW@gao.gov
Related GAO Product
Defense Production Act: Opportunities Exist to Increase Transparency and Identify Future Actions to
Mitigate Supply Chain Issues. GAO-21-108. Washington, D.C.: November 19, 2020.
Page 214
GAO-21-387

Federal Contracts and Agreements for COVID-19
As of February 28, 2021, federal agencies had reported obligating billions of dollars in support
of COVID-19 through contracts and other transaction agreements. The U.S. Department of
Agriculture faced challenges reporting more than $1 billion in COVID-19 contract obligations and
managing contract ﬁles for its Farmers to Families Food Box Program, raising concerns about its
guidance and personnel resources for the program.
Entities involved: Agricultural Marketing Service, within the U.S. Department of Agriculture;
Department of Defense; Department of Health and Human Services; and Department of
Homeland Security, among others
Recommendations for Executive Action
The Secretary of Agriculture should direct the Administrator of the Agricultural Marketing Service
to issue guidance—such as an acquisition alert or a reminder to contracting oﬃcials—on the use
of the COVID-19 National Interest Action code for the Farmers to Families Food Box Program or
successor food distribution program to ensure it accurately captures COVID-19-related contract
obligations in support of the program. The U.S. Department of Agriculture neither agreed nor
disagreed with our recommendation.
In a draft of this report provided to U.S. Department of Agriculture for comment, this
recommendation included a provision to retroactively report prior contract actions with the
National Interest Action code. The U.S. Department of Agriculture agreed and took prompt action
that addressed our concern about adequately capturing COVID-19-related contract obligations in
support of the Farmers to Families Food Box Program. As a result, we have removed that part of
this recommendation from the ﬁnal report.
The Secretary of Agriculture should direct the Administrator of the Agricultural Marketing Service
to assess the contracting personnel needed to fully execute the award and administration of
existing contracts in support of the Farmers to Families Food Box Program or successor future
food distribution program, and take the necessary steps to ensure it has adequate contracting
staﬀ in place to award and administer any future contracts for the program. The U.S. Department
of Agriculture neither agreed nor disagreed with our recommendation.
Key Considerations and Future GAO Work
As federal contracting activity continues to play a critical role in response to the pandemic,
ensuring that contract actions made in response to COVID-19 are accurately reported and
visible to congressional decision makers, entities with oversight responsibilities, and taxpayers
is critical. In January 2021, we recommended that the Assistant Secretary for Preparedness and
Response (ASPR) accurately report data in the federal procurement database system and provide
information that would allow the public to distinguish between spending on other transaction
agreements and procurement contracts. The Department of Health and Human Services (HHS)
concurred and stated that it has taken steps to manually identify other transaction agreements
in its contract writing system. HHS also plans to update its contract writing system. HHS did not
provide an update on its progress implementing the recommendation.
Page 215
GAO-21-387

In September 2020, we recommended that the Secretaries of Homeland Security and Defense (1)
revise the 2019 National Interest Action (NIA) code memorandum of agreement to identify steps
they will take to obtain input from key federal agencies prior to extending or closing a NIA code; (2)
establish timelines for evaluating the need to extend a NIA code; and (3) deﬁne certain criteria for
extending or closing the NIA code to reﬂect government-wide needs for tracking contract actions
in longer term emergencies, such as a pandemic.304
The Department of Homeland Security (DHS) and the Department of Defense (DOD) did not agree
with our recommendations. However, as of February 2021, a DOD oﬃcial said that DHS and DOD
were in the process of updating the agreement to clarify the steps they would take to obtain input
from other federal agencies and some of the factors considered when determining whether to
extend or close a NIA code. We will review the updated agreement when ﬁnalized to determine
whether it meets the intent of the recommendation.
We have work underway related to the federal government’s use of contracts to respond to
COVID-19, including, among other things, assessing (1) contracts awarded by selected agencies
in response to COVID-19, including agencies’ eﬀorts to review prospective contractors in advance
of awarding a contract, and (2) selected agencies’ use of contracting ﬂexibilities, such as other
transaction agreements and undeﬁnitized contracts.
Background
To facilitate the U.S. response to COVID-19, federal agencies have used a variety of contracting
mechanisms to provide vital goods and services in support of federal, state, and local COVID-19
response eﬀorts. For example, federal agencies have reported billions of dollars in obligations
on contracts subject to the Federal Acquisition Regulation.305 Our prior work on disaster
contracting has found that contracts play a key role in federal emergency response eﬀorts, and
that contracting during an emergency can present a unique set of challenges as oﬃcials can
face signiﬁcant pressure to provide critical goods and services as expeditiously and eﬃciently as
possible. The January 2021 National Strategy for the COVID-19 Response and Pandemic Preparedness
emphasizes the important role contracts will continue to play during the response. The strategy
states that the federal government will fully leverage contract authorities to strengthen the vaccine
supply chain; staﬀ vaccination sites; and ﬁll supply shortages for personal protective equipment,
drugs, and therapeutics.
In addition, federal agencies like DOD and HHS have relied on the use of other transaction
agreements to respond to COVID-19. Such agreements can enable them to negotiate terms and
conditions speciﬁc to a project. The CARES Act relaxed certain limitations on the use of other
304NIA codes were established in 2005 after Hurricane Katrina to track federal procurements for speciﬁc disasters,
emergencies, or contingency events. The Department of Defense, the Department of Homeland Security, and the
General Services Administration established the NIA code for COVID-19 on March 13, 2020, and as of February 2021, it
was to remain active until September 30, 2021.
305For the purposes of this report, “contract obligations” refers to obligations on procurement contracts that are subject
to the Federal Acquisition Regulation and does not include, for example, grants, cooperative agreements, loans, other
transactions for research, real property leases, or requisitions from federal stock.
Page 216
GAO-21-387

transactions for HHS and DOD, such as congressional reporting requirements and requirements
for who can approve certain transactions.306
NIA codes were established in 2005 following Hurricane Katrina to enable the consistent
tracking of emergency or contingency-related contracting actions in the Federal Procurement
Data System-Next Generation (FPDS-NG). Based on the memorandum of agreement guiding
the management of the NIA code, DHS and DOD are responsible for making determinations
about whether to establish or close a code, based on a variety of considerations. The General
Services Administration (GSA)—the agency that operates and maintains FPDS-NG—is responsible
for adding or updating the NIA code in the system based on DHS’s and DOD’s decisions. The
COVID-19 NIA code—used to track contract actions and associated obligations in response to
COVID-19 in FPDS-NG—was originally established on March 13, 2020, and set to expire on July 1,
2020. DHS and DOD subsequently extended the code three times—ﬁrst to September 30, 2020,
then to March 31, 2021, and more recently to September 30, 2021. The extensions of the code
are consistent with our prior recommendations to DHS, DOD, and GSA related to the importance
of ensuring federal agencies, the public, and Congress have visibility into contract actions and
associated obligations related to emergency response eﬀorts.
In May 2020, USDA implemented the Farmers to Families Food Box Program to assist commodity
suppliers impacted by the pandemic and to provide food assistance to the public. To accomplish
these goals, USDA contracted with hundreds of distributors to purchase billions of dollars in fresh
fruits, vegetables, dairy, and meat products, and package these products into family-sized food
boxes for delivery to food banks, community and faith-based organizations, and other non-proﬁt
entities across the country.
Overview of Key Issues
Agencies obligated $55.5 billion on federal contracts, with DOD and HHS accounting for
most obligations. In response to the COVID-19 pandemic, contract obligations totaled about
$55.5 billion as of February 28, 2021. DOD accounted for about 43 percent and HHS for about 28
percent of the total obligations made by federal agencies. USDA’s obligations, almost all of which
were in support of the Farmers to Families Food Box Program, accounted for $5.2 billion, or 10
percent of total obligations made in response to COVID-19 (see ﬁgure).307
306Pub. L. No. 116-136, §§ 3301, 13006, 134 Stat. at 383, 522.
307See the Agriculture Spending on Food Purchases enclosure in appendix I for more information.
Page 217
GAO-21-387

Contract Obligations in Response to COVID-19 by Federal Agency, as of February 28, 2021
In our January 2021 report, we reported that government-wide contract obligations related
to COVID-19 totaled $41.4 billion through December 31, 2020; by February 28, 2021, those
obligations had increased by about $14 billion—to $55.5 billion. DOD accounted for about $9.7
billion, or about 70 percent of the increase in total contract obligations since December 31, 2020.
See ﬁgure for government-wide obligations by week.
Page 218
GAO-21-387

Government-wide Contract Obligations Related to COVID-19 by Week, February 2020–February 2021
Obligations on drugs and biologicals surpassed medical equipment and supplies to be the
largest area of government-wide contract obligations in response to COVID-19. As of February
28, 2021 obligations for drugs and biologicals almost tripled to $14.6 billion from $5.4 billion
as of December 31, 2020, and represented about two-thirds of the overall increase in contract
obligations. About $6.3 billion of the increase in obligations for drugs and biologicals is for the
purchase of an additional 100 million vaccine doses each from Pﬁzer and Moderna, along with the
purchase of 1.25 million doses of Regeneron’s therapeutic to treat COVID-19. Medical equipment
and supplies—including ventilators and personal protective equipment—increased by about
$227.4 million since December 31, 2020, and accounted for about $8.9 billion, or 16 percent of
government-wide contract obligations. Obligations for fruits and vegetables—made primarily
in support of the USDA’s Farmers to Families Food Box Program—increased by an additional
$1.5 billion, to $3.9 billion. This increase was driven in part by USDA’s updates to data reporting
in response to our draft report recommendation that the Agricultural Marketing Service (AMS)
address inaccurate contract action reporting. See ﬁgure for obligation amounts for the most-
procured goods and services.
Page 219
GAO-21-387

Contract Obligation Amounts for Goods and Services Most Procured in Response to COVID-19, as of February 28,
2021
As of February 28, 2021, the proportion of contracts identiﬁed as having been awarded non-
competitively increased to about 60 percent of government-wide contract obligations, or about
$33.5 billion.308 Oﬃcials at HHS, DOD, and DHS have identiﬁed supply chain shortages for goods
like personal protective equipment and testing supplies which, according to a DOD oﬃcial,
contributed to the need to award some contracts noncompetitively. Agencies must provide for full
and open competition when awarding contracts, unless one of several limited exceptions applies,
such as when there is an unusual and compelling urgency for a needed supply or service. Agencies
cited an urgent need for awarding contracts noncompetitively for about 81 percent, or about $27.2
billion, of the contract obligations associated with noncompetitive awards.309 However, our prior
work has noted that promoting competition—even in a limited form—increases the likelihood of
acquiring quality goods and services at a lower price in urgent situations.
As of February 28, 2021, contracts for goods continued to be competed less frequently than
contracts for services: About 72 percent of the obligations for goods were on contracts that were
not awarded competitively, compared with about 40 percent of the obligations for services.
For example, about $14.1 billion, or 97 percent, of the $14.6 billion in obligations for drugs and
biologicals and about $7.6 billion, or 85 percent, of the $8.9 billion in obligations for medical and
surgical equipment, were on contracts awarded noncompetitively.
308Our methodology for identifying noncompetitive contracts is explained in detail at the end of this enclosure.
309For the purposes of this report, obligations on contracts identiﬁed as using the unusual and compelling urgency
exception include those associated with contracts subject to Federal Acquisition Regulation 6.302-2, as well as orders
under multiple award contracts, which are subject to separate competition requirements under Federal Acquisition
Regulation Part 16. Speciﬁcally, under Federal Acquisition Regulation 16.505(b)(2), orders on multiple award contracts
require contracting oﬃcers to give every awardee a fair opportunity to be considered for a delivery order or task order
exceeding $3,500, with exceptions, including if the agency need for the supplies or services is so urgent that providing
a fair opportunity would result in unacceptable delays. When using the unusual and compelling urgency exception to
full and open competition, agencies still must request oﬀers from as many potential sources as is practicable under the
circumstances.
Page 220
GAO-21-387

Undeﬁnitized contracts are one technique that agencies have reported using to respond to
COVID-19. Undeﬁnitized contracts can enable the government to quickly fulﬁll requirements that
are urgent or need to be met quickly by allowing contractors to begin work before reaching a ﬁnal
agreement with the government on all contract terms and conditions.310 As of February 28, 2021,
undeﬁnitized contract obligations were about $4.9 billion, and accounted for about 9 percent
of government-wide contract obligations on contracts awarded in response to COVID-19. DOD
reported the highest amount of undeﬁnitized contract obligations, identifying about $4 billion,
or about 17 percent of its COVID-19-related contract obligations as being undeﬁnitized. Our prior
work has shown that these types of contracts can pose risks to the government. For example,
contractors may lack incentives to control costs before all contract terms and conditions are
deﬁned.
Federal agencies have obligated at least $12.2 billion through other transaction
agreements. Three federal agencies—DOD, HHS, and DHS—have continued to report using other
transaction agreements in response to COVID-19. From December 31, 2020, through February 28,
2021, obligations associated with other transaction agreements reported by DOD, HHS, and DHS
increased from about $11.9 billion to $12.2 billion. Of the $12.2 billion, DOD reported obligating
about $10.8 billion through other transaction agreements, including at least $8.7 billion for
Operation Warp Speed, an eﬀort to manufacture large-scale vaccines and therapeutics in response
to COVID-19.
Our analysis of FPDS-NG data and agreement documents found at least four other transaction
agreements with about $1.5 billion obligated in support of the Operation Warp Speed eﬀort
and other medical countermeasures, which can include therapeutic treatments and testing
capabilities. In our January 2021 report, we found that ASPR had misreported these other
transaction agreements as procurement contracts. Our prior work has noted that the use of other
transaction agreements can help agencies attract companies that do not typically do business with
the government. However, their use also carries a risk of reduced accountability and transparency.
USDA faced challenges reporting more than $1 billion in contract obligations and managing
contract documentation for the Farmers to Families Food Box Program. AMS, the USDA
agency implementing the Farmers to Families Food Box Program, has awarded hundreds of
contracts for the Farmers to Families Food Box Program. Contractors received contracts to
purchase, package, and distribute food to food banks and other non-proﬁts across the country. As
USDA received additional funding for the program throughout 2020, AMS continued to periodically
solicit prospective contractors and award contracts to keep the program operational.
We identiﬁed contract data reporting challenges related to AMS’s early awards in support of the
program. For example, in February 2021, we found over 300 contract actions totaling about $1.2
billion in obligations for the Farmers to Families Food Box Program that were not reported with
the NIA code, even though the base contracts were coded as related to the COVID-19 response.
AMS has corrected these data reporting issues, which addresses our draft report recommendation
that AMS retroactively report the contract actions with the NIA code. We also found some of the
program’s contracts—totaling up to $218 million in obligations—were incorrectly reported in
310Undeﬁnitized contracts include letter contracts, as well as other undeﬁnitized actions.
Page 221
GAO-21-387

FPDS-NG as competitively awarded instead of as non-competitively awarded, which AMS oﬃcials
also corrected after we brought it to their attention.
In addition to contract data reporting issues, we found that AMS has experienced challenges
compiling complete contract documentation for the approximately 200 contracts awarded in the
spring and summer of 2020. A contracting oﬃcial involved in the program noted that currently
contract documentation associated with some awards—such as acquisition planning documents,
source selection and pricing decisions, and correspondence with contractors—are stored in
various contracting personnel email accounts and computers, rather than in AMS’s Web Based
Supply Chain Management System, the AMS system of record for maintaining contract ﬁles.
This is the case even though some of these contracts were awarded more than 9 months ago
in May 2020. The Federal Acquisition Regulation requires the heads of contracting oﬃces to
establish ﬁles containing the records of all contract actions to provide a complete background of
the basis for the decisions made in the acquisition process.311 AMS oﬃcials noted that the contract
documentation in question exists and that its organization has improved over time.
According to AMS oﬃcials, the Farmers to Families Food Box Program was a new program
implemented in a matter of weeks to address the economic diﬃculties facing farmers and
agricultural producers, food suppliers and distributors, and unemployed Americans in need of
food assistance as a result of COVID-19. However, the contract data reporting and documentation
challenges we identiﬁed raise questions about whether AMS has provided suﬃcient guidance
or contracting resources to the program to ensure that the contracts awarded to support the
Farmers to Families Food Box Program have been eﬀectively reported and managed. When we
spoke to AMS oﬃcials, we found that no additional direction was provided to the AMS personnel
responsible for entering contract actions into FPDS-NG regarding coding all procurement actions
made in response to COVID-19 with the NIA code.
Furthermore, according to AMS oﬃcials, one contracting oﬃcer and seven contracting specialists
largely executed the contracts made in support of the program—totaling over 1,200 contract
actions and $5.2 billion in contract obligations as of February 28, 2021. According to a contracting
oﬃcial involved in the program, the speed with which the contracts for the program have been
executed and the sheer volume of awards that continue to be made have aﬀected contracting
oﬃcials’ ability to ensure accurate contract reporting and the compilation of complete contract
ﬁles. According to AMS oﬃcials, they leveraged about 20 staﬀ to assist with vendor reviews, invoice
approval, domestic origin veriﬁcation, and food safety audits related to the program. However,
AMS oﬃcials said they did not consider adding additional contracting oﬃcers or specialists from
within AMS or other USDA agencies to award or administer Farmers to Families Food Box Program
contracts, even though the obligations for the program accounted for about 74 percent of AMS’s
total reported contract obligations over the past year.
AMS oﬃcials noted that they used a diﬀerent contracting approach starting in September 2020
for the program that has added some eﬃciencies to the contracting process.312 However, the
challenges we found related to inaccurate contract reporting and incomplete contract ﬁles have
311FAR 4.801.
312For rounds 3, 4, and 5 of the Farmers to Families Food Box Program, AMS oﬃcials established basic ordering
agreements with vendors, who then competed amongst themselves to fulﬁll speciﬁc requirements for the program.
Page 222
GAO-21-387

persisted even after the change in contracting strategy. AMS oﬃcials also stated that they recently
completed a reorganization based on a workforce analysis completed several years ago. Under
the reorganization, AMS said they have hired or plan to hire at least 20 staﬀ, including contracting
oﬃcers and specialists. However, as of February 2021, AMS oﬃcials said that they have not
speciﬁcally assessed whether the additional contracting oﬃcers will be assigned to support the
Farmers to Families Food Box Program since it is expected to be completed in April 2021, and they
are uncertain what plans, if any, there will be to continue the program.
In September 2020, we reported that the need to quickly execute the program led to challenges,
including limited time to implement the program and limited staﬀ, and that USDA did not have
plans to evaluate the program to identify successes, challenges, and lessons learned. At that time,
USDA oﬃcials stated that because the Farmers to Families Food Box Program was developed
as a temporary measure in response to the COVID-19 outbreak, the costs of conducting a
programmatic evaluation seemed to outweigh the beneﬁts, and that the program was expected to
be completed by the end of October 2020. However, since then, the program has been extended,
with the agency receiving an additional $2 billion and awarding numerous additional contracts.
Under the American Rescue Plan Act of 2021, signed into law on March 11, 2021, USDA is to
receive an additional $4 billion in funding for the pandemic response, which includes additional
funds for purchasing and distributing food to individuals in need.313 Additional funding to
continue food distribution eﬀorts makes an assessment of the contracting workforce needed to
award and administer contracts in support of the Farmers to Families Food Box Program, or a
successor food distribution program, all the more crucial.
Federal internal control standards state that an agency’s management should internally and
externally communicate quality information to achieve the agency’s objectives. Moreover, key
principles for strategic workforce management emphasize the importance of determining the
critical skills and competencies needed to achieve future programmatic results and addressing
gaps in critical skills and competencies to achieve mission success. Without guidance reinforcing
the need to use the NIA code to track Farmers to Families Food Box contract actions, AMS may
continue to face challenges reporting quality information on billions of dollars in contract activity
to the public—including congressional decision makers, entities with oversight responsibilities, and
taxpayers. The accurate reporting of Farmers to Families Food Box Program contract obligations
is especially important given that fruits and vegetables is the federal government’s third largest
area of contract obligations, after “drugs and biologicals” and “medical equipment and supplies”.
Moreover, without assessing the workforce needed to manage existing contracts that underpin
the program and any future food distribution contracts, AMS cannot ensure that the contract
reporting and management of contract documentation challenges they have encountered are
addressed, particularly as an additional $4 billion in funding is provided.
Agency Comments
We provided HHS, DOD, DHS, USDA, and the Oﬃce of Management and Budget with a draft of this
enclosure. HHS, DOD, DHS, and the Oﬃce of Management and Budget did not provide comments.
USDA provided comments, which we incorporated as appropriate and summarize below.
313American Rescue Plan Act of 2021, Pub. L. No. 117-2, § 1001, 135 Stat. 4.
Page 223
GAO-21-387

In its comments, USDA agreed with part of a draft recommendation stating that USDA should
retroactively report contract actions with the NIA code to adequately capture COVID-19-related
contract obligations in support of the program. Prior to the publication of this report, USDA took
action and addressed that part of the recommendation. As a result, we have removed that part of
the recommendation from the ﬁnal report.
USDA neither agreed nor disagreed with our recommendation to issue internal guidance on the
use of the COVID-19 NIA code to ensure USDA AMS accurately captures its COVID-19-related food
distribution contract obligations. According to AMS oﬃcials, additional guidance related to using
the NIA code is not needed because Oﬃce of Management and Budget memorandum M-20-21
already directs agencies to use the COVID-19 NIA code for all procurement actions reported in the
FPDS-NG.314 However, with OMB’s guidance in place, AMS oﬃcials still encountered challenges
accurately coding over $1 billion in contract actions. Moreover, several agencies, including DOD,
DHS, HHS, and the Department of Veterans Aﬀairs, have issued supplemental guidance or
alerts to communicate the Oﬃce of Management and Budget requirements to their personnel.
Additional guidance, such as an acquisition alert or reminder to contracting oﬃcials, would help to
ensure AMS’s coding challenges do not persist in the future.
USDA also neither agreed nor disagreed with our recommendation to assess the contracting
personnel needed to fully execute the award and administration of existing contracts in support
of the Farmers to Families Food Box Program or successor future food distribution program. AMS
oﬃcials stated that they had the right amount of staﬀ to successfully execute contracts for the
Farmers to Families Food Box Program, and that the number of staﬀ supporting the program had
little to do with the issues we identiﬁed. However, as noted above, AMS oﬃcials we spoke with did
attribute challenges with contract data reporting and management to the sheer volume of awards
that continue to be made in support of the program. AMS oﬃcials noted in their comments that
they are in the process of ﬁlling some positions and adding staﬀ, which we also note above, but
AMS has not determined how these or other contracting staﬀ will support contract management
and administration needs. Given the additional $4 billion in funding USDA will receive for the
pandemic response, which includes additional funds for food distribution eﬀorts, we maintain
that guidance to ensure the accurate reporting of its COVID-19- related contract obligations and an
assessment of the contracting workforce needed to eﬀectively support the program are prudent
steps to take.
Methodology
To identify agencies’ federal contract and other transaction agreement obligations and
competition rate on contracts in response to COVID-19, we reviewed data reported in the FPDS-NG
through February 28, 2021.315 We identiﬁed contract obligations related to COVID-19 using the NIA
314Oﬃce of Management and Budget M-20-21, Implementation Guidance for Supplemental Funding Provided in Response to
the Coronavirus Disease 2019 (COVID-19), April 10, 2020.
315FPDS-NG data from beta.SAM.gov accessed February 28, 2021. For purposes of this report, “competition rate” is
the percentage of total obligations associated with contracts awarded competitively. We calculated competition rates
as the percentages of obligations on competitive contracts and orders over all obligations on contracts and orders.
Competitive contracts included contracts and orders coded in the FPDS-NG as “full and open competition,” “full and
Page 224
GAO-21-387

code, as well as the contract description ﬁeld.316 For contract actions over $1 million, we removed
obligations that were identiﬁed in the contract description as not related to COVID-19.
We assessed the reliability of federal procurement data by reviewing existing information
about FPDS-NG and the data it collects—speciﬁcally, the data dictionary and data validation
rules—and by performing electronic testing. For the four other transaction agreements that HHS
misreported as contracts, we removed the $1.5 billion associated obligations from our reported
contract obligations and reported them instead as other transaction agreement obligations.
We determined that the data were suﬃciently reliable for the purposes of describing agencies’
reported contract obligations in response to COVID-19.
To assess USDA’s contract reporting and management of the Farmers to Families Food Box
Program, we reviewed program documentation and interviewed AMS oﬃcials.
Contact information: Marie A. Mak, (202) 512-4841, MakM@gao.gov
Related GAO Products
Agriculture Spending: Opportunities Exist for USDA to Identify Successes and Challenges of the Farmers
to Families Food Box Program to Inform Future Eﬀorts. GAO-20-711R. Washington, D.C.: September
16, 2020.
COVID-19 Contracting: Observations on Federal Contracting in Response to the Pandemic. GAO-20-632.
Washington, D.C.: July 29, 2020.
Defense Acquisitions: DOD’s Use of Other Transactions for Prototype Projects Has Increased.
GAO-20-84. Washington, D.C.: November 22, 2019.
DATA Act: Quality of Data Submissions Has Improved but Further Action Is Needed to Disclose Known
Data Limitations. GAO-20-75. Washington, D.C.: November 8, 2019.
Disaster Contracting: FEMA Continues to Face Challenges with Its Use of Contracts to Support Response
and Recovery. GAO-19-518T. Washington, D.C.: May 9, 2019.
2017 Disaster Contracting: Actions Needed to Improve the Use of Post-Disaster Contracts to Support
Response and Recovery. GAO-19-281. Washington, D.C.: April 24, 2019.
open after exclusion of sources,” and “competed under simpliﬁed acquisition procedures” as well as orders coded as
“subject to fair opportunity,” “fair opportunity given,” and “competitive set aside.” Noncompetitive contracts included
contracts and orders coded in the FPDS-NG as “not competed,” “not available for competition,” and “not competed under
simpliﬁed acquisition procedures,” as well as orders coded as an exception to “subject to fair opportunity,” including
“urgency,” “only one source,” “minimum guarantee,” “follow-on action following competitive initial action,” “other
statutory authority,” and “sole source.” Even for contracts identiﬁed as noncompetitive, agencies may have solicited
more than one source.
316In November 2019 we identiﬁed some inconsistencies in the information agencies report in the contract description
ﬁeld in the FPDS-NG. Data on DOD contract obligations based on information in the description ﬁeld were available only
through December 1, 2020, due to diﬀerences in the time frames for which DOD data are made publicly available.
Page 225
GAO-21-387

2017 Disaster Contracting: Action Needed to Better Ensure More Eﬀective Use and Management of
Advance Contracts. GAO-19-93. Washington, D.C.: December 6, 2018.
Standards for Internal Control in the Federal Government. GAO-14-704G. Washington, D.C.:
September 2014.
Federal Contracting: Noncompetitive Contracts Based on Urgency Need Additional Oversight.
GAO-14-304. Washington, D.C.: March 26, 2014.
Department of Homeland Security: Further Action Needed to Improve Management of Special
Acquisition Authority. GAO-12-557. Washington, D.C.: May 8, 2012.
Defense Contracting: DOD Has Enhanced Insight into Undeﬁnitized Contract Action Use, but
Management at Local Commands Needs Improvement. GAO-10-299. Washington, D.C.: January 28,
2010.
Department of Homeland Security: Improvements Could Further Enhance Ability to Acquire Innovative
Technologies Using Other Transaction Authority. GAO-08-1088. Washington, D.C.: September 23,
2008.
Human Capital: Key Principles for Eﬀective Strategic Workforce Planning. GAO-04-39. Washington,
D.C.: December 11, 2003.
Page 226
GAO-21-387

Unemployment Insurance Programs
The number of claims for unemployment insurance beneﬁts remained historically high through
mid-March 2021, as CARES Act unemployment insurance programs were extended for another
several months. Although states have improved their timeliness in making ﬁrst payments for
certain unemployment insurance beneﬁts since fall 2020, some claimants continue to face
substantial delays in receiving these payments. We continue to focus on the implications of the
high number of claims, including program integrity concerns.
Entity involved: Department of Labor
Recommendation for Executive Action
We are making the following recommendation to the Department of Labor:
The Secretary of Labor should ensure the Oﬃce of Unemployment Insurance collects data from
states on the amount of overpayments waived in the Pandemic Unemployment Assistance
program, similar to the regular unemployment insurance program. The Department of Labor
concurred with our recommendation.
Key Considerations and Future GAO Work
The unemployment insurance (UI) system provides a vital safety net for individuals who become
unemployed through no fault of their own, and this support is essential during widespread
economic downturns. In mid-March, as CARES Act UI programs were extended through September
6, 2021, the UI system continued to experience high numbers of claims, indicating that many
Americans are still relying on the ﬁnancial support these programs provide as the U.S. economy
continues to respond to the COVID-19 pandemic.
However, as we previously reported, the Department of Labor (DOL) does not collect or
report reliable counts of the number of individuals claiming beneﬁts. In November 2020, we
recommended that DOL address this issue by (1) revising its weekly news releases to clarify
that the numbers it reports for weeks of unemployment claimed do not accurately estimate the
number of unique individuals claiming beneﬁts, and (2) pursuing options to report the actual
number of distinct individuals claiming beneﬁts from January 2020 onward. DOL fully agreed with
our ﬁrst recommendation and partially agreed with our second recommendation, taking issue
with retroactive reporting.
Starting with the December 10, 2020 weekly UI news release, DOL has clariﬁed that the numbers
it reports for weeks of unemployment claimed do not represent the number of unique individuals
claiming beneﬁts, and we consider this recommendation closed. However, as of March 18, 2021,
DOL had not begun reporting the actual number of unique individuals claiming UI beneﬁts on a
weekly basis in its UI news releases. We maintain that these data are vital to understanding the
size of the population supported by the UI system during the pandemic. Even if the information
is unavailable for some time, reporting numbers for calendar year 2020 and after will help DOL
and policymakers identify lessons learned about the administration and utilization of regular
and expanded UI beneﬁt programs during the pandemic. We encourage DOL to pursue options
Page 227
GAO-21-387

to report the actual number of individuals claiming beneﬁts in the most feasible and least
burdensome way.
We continue to focus on the implications of persistently high numbers of claims for UI beneﬁts.
Backlogs in processing historic numbers of UI claims during the pandemic have led to delays in
eligible claimants receiving their ﬁrst beneﬁts. Although the timeliness of certain UI payments has
improved since fall 2020, some claimants continue to face substantial delays in receiving their
ﬁrst beneﬁt payments. In addition, as the number of UI claims remains historically high, states
continue to face ﬁnancial strain, and some have sought loans from the federal government to pay
UI beneﬁts. As of March 12, 2021, 20 states and territories held about $52.1 billion in federal loans
taken out to pay UI beneﬁts.
We also remain concerned about program integrity throughout the UI system. DOL continues to
stress the importance of addressing potential fraud in the UI system and support states to help
ensure UI program integrity. For example, early in 2021, DOL continued to stress the importance
of UI program integrity in its guidance documents and provided additional administrative funding
to carry out program integrity eﬀorts. The Department of Justice, DOL’s Oﬃce of Inspector
General, and states continue to take actions to prevent, detect, and respond to potential UI fraud.
In addition, in January 2021, we recommended that DOL collect data from states on the amount of
overpayments recovered in the Pandemic Unemployment Assistance program. DOL agreed with
our recommendation and on January 8, 2021, took the ﬁrst step toward implementing it by issuing
instructions for states to report this overpayment recovery data. As of March 15, 2021, 14 states
had begun reporting some overpayment recovery data to DOL.
Additional data on the amounts of overpayments states do not intend to recover are also needed
for eﬀective monitoring of federal funding. Legislation enacted at the end of 2020 authorized
states to waive certain overpayments made at any time in the Pandemic Unemployment
Assistance program—for example, if the individual who was overpaid was without fault and
repayment would be contrary to equity and good conscience.317 DOL is not yet collecting
information from states about these waived overpayments. Sustained reporting by states would
inform DOL, policymakers, and the public about the extent of overpaid federal funds states have
recovered, how much remains outstanding, and how much states do not intend to recoup.
Since our last report in January, several developments have expanded access to CARES Act UI
beneﬁts or aﬀected the program in other ways. On February 25, 2021, DOL issued guidance
expanding eligibility for beneﬁts under the Pandemic Unemployment Assistance program to
include, among others, certain individuals who refuse to return to work or accept an oﬀer of new
work that is unsafe.318
317Pub. L. No. 116-260, div. N, tit. II, § 201(d), 134 Stat. 1182, 1952.
318The DOL guidance deﬁnes unsafe worksites as those not in compliance with local, state, or national health and safety
standards related to COVID-19, such as standards related to facial mask wearing, physical distancing measures, or the
provision of personal protective equipment consistent with public health guidelines. Department of Labor, Expanded
Eligibility Provisions for the Pandemic Unemployment Assistance (PUA) Program, Unemployment Insurance Program Letter
(UIPL) 16-20 Change 5 (Washington, D.C.: Feb. 25, 2021).
Page 228
GAO-21-387

The American Rescue Plan Act of 2021, enacted on March 11, 2021, extended CARES Act UI
programs through September 6, 2021, and included other provisions related to UI, such as
allowing $10,200 of unemployment insurance compensation to be tax free in 2020, if an
individual’s adjusted gross income is less than $150,000.319 The law also provides $2 billion for
DOL to detect and prevent fraud, promote equitable access, and ensure the timely payment of UI
beneﬁts, and $8 million for administrative expenses related to UI programs.320 We will monitor
these developments and program integrity issues as we continue our oversight work.
Background
The UI program is a federal-state partnership that provides temporary ﬁnancial assistance
to eligible workers who become unemployed through no fault of their own. States design
and administer their own UI programs within federal parameters, and DOL oversees states’
compliance with federal requirements, such as ensuring states pay beneﬁts when they are due.
Regular UI beneﬁts—those provided under the state UI programs in place before the CARES Act
was enacted—are funded primarily through state taxes levied on employers, and are intended to
typically be lower than a claimant’s previous earnings, according to DOL.321
The CARES Act created, and the Consolidated Appropriations Act, 2021, and the American Rescue
Plan Act of 2021, amended, three federally funded temporary UI programs that expanded beneﬁt
eligibility and enhanced beneﬁts.322
1. Pandemic Unemployment Assistance (PUA), generally available through September 6, 2021,
generally authorizes up to 79 weeks of UI beneﬁts to individuals not otherwise eligible for UI
beneﬁts, such as self-employed and certain gig economy workers, who are unable to work as a
result of speciﬁed COVID-19 reasons.323
319Pub. L. No. 117-2, §§ 9011(a), 9013, 9016(a), 9042(a), 135 Stat. 4, 118-119, 122.
320Pub. L. No. 117-2, §§ 9031, 9032, 135 Stat. 4, 121.
321To be eligible for regular UI beneﬁts, applicants generally must be able and available to work, and be actively seeking
work. 42 U.S.C. § 503(a)(12). The regular UI program is also ﬁnanced by a federal tax on employers, which according to
DOL oﬃcials, primarily supports the administration of the program.
322The CARES Act also addressed other aspects of the UI system, such as authorizing certain ﬂexibilities for states to
hire additional staﬀ and to participate in Short-Time Compensation programs. In addition to the CARES Act, the Families
First Coronavirus Response Act provided up to $1 billion in emergency grant funding to states in ﬁscal year 2020 for UI
administrative purposes. In addition, on August 8, 2020, the President signed a memorandum directing the Department
of Homeland Security’s Federal Emergency Management Agency (FEMA) to provide up to $44 billion in lost wages
assistance (LWA). Pursuant to the presidential memorandum, upon receiving a FEMA grant, states and territories could
provide eligible claimants $300 or $400 per week—which included a $300 federal contribution—in addition to their UI
beneﬁts. The White House, Memorandum on Authorizing the Other Needs Assistance Program for Major Disaster Declarations
Related to Coronavirus Disease 2019 (Aug. 8, 2020). FEMA approved 54 states and territories to provide LWA to eligible
claimants for at most 6 weeks of unemployment experienced from the week ending August 1, 2020, through the week
ending September 5, 2020.
323Pub. L. No. 117-2, § 9011(a), (b), 135 Stat. 4, 118; Pub. L. No. 116-260, div. N, tit. II, § 201(a), (b), 134 Stat. 1182,
1950-1951 (2020); Pub. L. No. 116-136, § 2102, 134 Stat. at 313. The Consolidated Appropriations Act, 2021
increased the maximum number of weeks of PUA beneﬁts authorized from 39 to 50, and generally extended the
Page 229
GAO-21-387

2. Federal Pandemic Unemployment Compensation (FPUC) generally authorized an additional
$600 weekly beneﬁt through July 2020, and authorizes a $300 beneﬁt for weeks beginning
after December 26, 2020 and ending on or before September 6, 2021, for individuals eligible
for weekly beneﬁts under the regular UI and CARES Act UI programs.324
3. Pandemic Emergency Unemployment Compensation (PEUC), generally available through
September 6, 2021, generally authorizes an additional 53 weeks of UI beneﬁts to those who
exhaust their regular UI beneﬁts.325
The Consolidated Appropriations Act, 2021 created, and the American Rescue Plan Act of 2021
extended, the Mixed Earner Unemployment Compensation (MEUC) program, which authorizes
an additional $100 weekly beneﬁt for certain individuals.326 To be eligible, claimants must have
received at least $5,000 of self-employment income in the most recent tax year prior to their
application for UI beneﬁts. The $100 weekly beneﬁt is in addition to other UI beneﬁts received by
claimants; however, individuals receiving PUA beneﬁts may not receive MEUC payments.327
In addition to the extensions and expansions of beneﬁts, the Consolidated Appropriations Act,
2021 added new program integrity requirements for the CARES Act UI programs. For example,
the act generally requires PUA claimants to provide documentation substantiating their prior
employment or self-employment and to recertify with their state each week that they continue to
expiration of the program from December 31, 2020 to March 14, 2021. The American Rescue Plan Act of 2021
further increased the maximum number of weeks of PUA beneﬁts to 79, and generally extended the expiration of
the program to September 6, 2021. The CARES Act also provided funding for up to an additional 7 weeks of PUA
beneﬁts in certain states with high rates of unemployment. Department of Labor, CARES Act of 2020 – Pandemic
Unemployment Assistance (PUA) Program Operating, Financial and Reporting Instructions, Unemployment Insurance
Program Letter (UIPL) 16-20 (Washington, D.C.: Apr. 5, 2020).
324Pub. L. No. 117-2, § 9013, 135 Stat. 4, 119; Pub. L. No. 116-260, div. N, tit. II, § 203, 134 Stat. 1182, 1953; Pub.
L. No. 116-136, § 2104, 134 Stat. at 318. The Consolidated Appropriations Act, 2021 authorized the $300 beneﬁt
initially through March 14, 2021, and the American Rescue Plan Act of 2021 extended that beneﬁt through
September 6, 2021.
325Pub. L. No. 117-2, § 9016(a), (b), 135 Stat. 4, 119-120; Pub. L. No. 116-260, div. N, tit. II, § 206(a), (b), 134 Stat.
1182, 1954; Pub. L. No. 116-136, § 2107, 134 Stat. at 323. The Consolidated Appropriations Act, 2021 increased
the maximum amount of PEUC beneﬁts from 13 to 24 times the individual’s average weekly beneﬁt amount, and
generally extended the expiration of the PEUC program from December 31, 2020 to March 14, 2021. The American
Rescue Plan Act of 2021 further increased the maximum amount to 53 times the individual’s average weekly beneﬁt
amount, and generally extended the expiration of the program to September 6, 2021. Consistent with the CARES
Act and program extension in the Consolidated Appropriations Act, 2021, the increased maximum amount of
PEUC beneﬁts translates to 53 weeks of beneﬁts for individuals who are totally unemployed. However, individuals
may receive more weeks of beneﬁts if they are receiving a reduced weekly beneﬁt amount for weeks of partial
unemployment. See Department of Labor, Continued Assistance for Unemployed Workers Act of 2020—Pandemic
Emergency Unemployment Compensation (PEUC) Program: Extension, Transition Rule, Increase in Total Beneﬁts, and
Coordination Rules, Unemployment Insurance Program Letter (UIPL) 17-20, Change 2 (Washington, D.C.: Dec. 31,
2020).
326Pub. L. No. 117-2, § 9013(a), 135 Stat. 4, 119; Pub. L. No. 116-260, div. N, tit. II, § 261(a)(1), 134 Stat. 1182, 1961. The
American Rescue Plan Act of 2021 generally extended MEUC through September 6, 2021.
327Department of Labor, Continued Assistance for Unemployed Workers (Continued Assistance) Act of 2020 – Federal
Pandemic Unemployment Compensation (FPUC) Program Reauthorization and Modiﬁcation and Mixed Earners Unemployment
Compensation (MEUC) Program Operating, Reporting, and Financial Instructions, Unemployment Insurance Program Letter
(UIPL) 15-20, Change 3 (Washington, D.C.: Jan. 5, 2021).
Page 230
GAO-21-387

meet the eligibility requirement of not being able to work as a result of COVID-19.328 In addition,
states are required to have procedures for identity veriﬁcation or validation and for timely
payment of PUA beneﬁts, to the extent reasonable and practicable.329 Further, states must
generally require individuals who receive PUA beneﬁts they were not entitled to, to repay the
amount, but states can waive that requirement under certain conditions.330
During the pandemic, regular UI claimants in certain states have also had access to the Extended
Beneﬁts program. The program, which existed prior to the pandemic and provides up to an
additional 13 or 20 weeks of beneﬁts, is activated in states during periods of high unemployment,
according to DOL. If unemployment is not high enough to activate the Extended Beneﬁts program
in a state, or if regular UI claimants exhaust their PEUC and Extended Beneﬁts, they may be
eligible for PUA beneﬁts—provided they also meet PUA eligibility requirements.331
Overview of Key Issues
About a year after enactment of the CARES Act, the number of weekly initial claims for
UI beneﬁts remains persistently high. DOL reported that 746,496 initial claims for regular UI
beneﬁts and 282,394 initial claims for PUA beneﬁts were submitted nationwide during the week
ending March 13, 2021.332 The number of regular UI initial claims submitted in recent weeks
is considerably lower than the peak of about 6.2 million submitted in the week ending April 4,
2020 (see ﬁgure). However, the number of regular UI initial claims submitted each week has
remained considerably higher than pre-pandemic levels. For example, the 746,496 regular UI initial
claims submitted during the week ending March 13, 2021—which does not include the 282,394
PUA initial claims also submitted—is about 3 times as high as the 251,851 submitted during the
corresponding week in 2020, prior to enactment of the CARES Act.
328Pub. L. No. 116-260, div. N, tit. II, §§ 241(a), 263(a), 134 Stat. 1182, 1959-1960, 1963.
329Pub. L. No. 116-260, div. N, tit. II, § 242(a), 134 Stat. 1182, 1960.
330Pub. L. No. 116-260, div. N, tit. II, § 201(d), 134 Stat. 1182, 1952. According to the Consolidated Appropriations Act,
2021, states can waive the requirement if the individual was without fault and repayment would be contrary to equity
and good conscience.
331If approved for PUA beneﬁts, the number of weeks of regular UI and Extended Beneﬁts a claimant already received is
subtracted from the duration of PUA beneﬁts. Department of Labor, CARES Act of 2020 – Summary of Key Unemployment
Insurance (UI) Provisions and Guidance Regarding Temporary Emergency State Staﬃng Flexibility, Unemployment Insurance
Program Letter (UIPL) 14-20 (Washington, D.C.: Apr. 2, 2020).
332An initial claim is the ﬁrst claim ﬁled by an individual to determine eligibility for UI beneﬁts after separating from
an employer. Initial claims counts presented are not seasonally adjusted, and counts for the week ending March 13,
2021 reﬂect advance initial claims, which are preliminary and subject to revision. In some cases, advance initial claims
represent estimates submitted by states that are later revised.
Page 231
GAO-21-387

Weekly Initial Claims Submitted Nationwide for Regular Unemployment Insurance (UI) and Pandemic
Unemployment Assistance (PUA) Beneﬁts, March 1, 2020 through March 13, 2021
Notes: The weekly counts of initial claims shown in the ﬁgure are not seasonally adjusted. Counts for weeks through February
27, 2021, are from Department of Labor (DOL) data ﬁles that include any adjustments submitted by states as of March 18, 2021.
Counts for the weeks ending March 6 and 13, 2021, are from DOL’s weekly report released on March 18, 2021, and the March
13 numbers reﬂect advance initial claims, which are preliminary and subject to revision. The number of states and territories
reporting PUA data is out of a potential total of 53. All 53 states and territories reported regular UI claims in each week shown.
The number of initial claims is not intended to measure how many claimants were determined
eligible to receive beneﬁts or how many who ﬁled for beneﬁts earlier in the pandemic are still
unemployed. DOL oﬃcials have stated that continued claims may be a better barometer than
initial claims for determining whether demand for beneﬁts remains high. Each week, DOL
publishes the number of continued claims submitted by states (i.e., weeks of unemployment
claimed by individuals during a reporting period). For example, for the week ending February 27,
2021, states reported about 18.2 million continued claims in all programs, including:
• about 4.5 million in the regular UI program;
• about 7.6 million in the PUA program;333 and
333One state and one territory did not report PUA continued claims data for the week ending February 27, 2021;
the continued claims count represents the total across the 51 of 53 states and territories reporting data.
Page 232
GAO-21-387

• about 6.1 million in other programs, such as the PEUC program.334
The about 4.5 million regular UI continued claims is substantially lower than the peak of over
20 million submitted per week in late April and early May 2020. Some of this decline is due to
claimants ﬁnding employment, though some of the decline is also likely due to other factors, such
as claimants exhausting regular UI beneﬁts and beginning to claim PEUC or other beneﬁts. Even
with the decline—regardless of the cause—the number of regular UI continued claims submitted
during the week ending February 27, 2021 (about 4.5 million) remains more than double the
approximately 2.1 million claims submitted for the corresponding week in 2020, prior to the
pandemic. In addition, during the 2007-2009 recession, by comparison, regular UI continued
claims peaked at about 6 million submitted each week from December 28, 2008 through August
22, 2009.335
The persistently high number of claims suggests continued high demand for beneﬁts. However,
as we have previously reported, the number of continued claims has not approximated the
number of individuals claiming beneﬁts during the pandemic due to backlogs in processing
historic numbers of claims in many states and other data issues. For example, backlogs in claims
processing led to individuals claiming multiple weeks of beneﬁts in single reporting periods and
thus being counted as multiple claims for that reporting period, particularly in the PUA program.
As previously stated, while DOL partially agreed to take action to address our recommendation
on this issue, it has not yet taken steps to do so. As such, reliable conclusions about trends in the
number of individuals claiming beneﬁts cannot be drawn from data on continued claims.
The large number of claims submitted for PEUC and the Extended Beneﬁts program
suggests that many individuals may be experiencing long-term unemployment. 336 After
exhausting regular UI beneﬁts—generally available for up to 26 weeks in most states—eligible
individuals are generally able to apply for (1) PEUC; then, (2) the Extended Beneﬁts program, if
activated in a state; and then, in certain circumstances, (3) PUA beneﬁts.337
As we reported in January, the number of continued claims submitted nationwide (i.e., weeks of
unemployment claimed by individuals during a reporting period) under PEUC and the Extended
Beneﬁts programs increased substantially in the fall of 2020, likely due to individuals exhausting
their regular UI beneﬁts as the pandemic continued. Although the number of PEUC continued
334Two states did not report PEUC continued claims data for the week ending February 27, 2021.
335According to the National Bureau of Economic Research, the 2007-2009 recession began in December 2007 and
ended in June 2009.
336In its Employment Situation news releases, the Bureau of Labor Statistics deﬁnes the long-term unemployed
population as those who are jobless for 27 weeks or more.
337According to DOL, as of July 2020, 45 of 53 states and territories generally provide up to a maximum of 26 weeks
of regular UI beneﬁts. Some states provide fewer than 26 weeks, though some of these states also provide additional
weeks of beneﬁts under limited circumstances, such as periods of high unemployment, according to DOL. As of March
14, 2021, DOL reported that the Extended Beneﬁts program was activated in 17 states and territories due to high
levels of unemployment. However, 1 territory was scheduled to stop providing Extended Beneﬁts on March 20, 2021.
The Extended Beneﬁts program was activated in all states except South Dakota at some point during the pandemic,
according to DOL. For example, as of June 28, 2020, the Extended Beneﬁts program was available in 49 states, the
District of Columbia, Puerto Rico, and the Virgin Islands, according to DOL.
Page 233
GAO-21-387

claims submitted nationwide each week declined at the end of 2020 and beginning of 2021, the
number remains high—about 4.8 million submitted during the week ending February 27, 2021
(see ﬁgure). Similarly, the number of continued claims submitted under the Extended Beneﬁts
program increased from about 352,000 during the week ending September 19 to about 1.1 million
the week ending February 27, 2021.
Weekly Continued Claims Submitted Nationwide for Pandemic Emergency Unemployment Compensation (PEUC)
Beneﬁts, March 1, 2020 through February 27, 2021
Notes: The weekly counts of continued claims shown in the ﬁgure are not seasonally adjusted. Counts for weeks through
February 20, 2021, are from Department of Labor (DOL) data that include any adjustments submitted by states as of March 18,
2021. The count for the week ending February 27, 2021, is from DOL’s weekly report released on March 18, 2021. The number
of states and territories reporting PEUC data is out of a potential total of 53.
Most states are participating in the new Mixed Earner Unemployment Compensation
program, which authorizes an additional $100 weekly beneﬁt for certain self-employed
individuals who are ineligible for PUA. 338 State participation in the new MEUC program is
voluntary.339 According to DOL, as of March 3, 2021, 51 of 53 states and territories had elected
to participate in the MEUC program, though just 2 had begun paying MEUC beneﬁts.340 As states
338The Consolidated Appropriations Act, 2021 created the MEUC program, and the American Rescue Plan Act of 2021
generally extended MEUC through September 6, 2021. Pub. L. No. 117-2, § 9013(a), 135 Stat. 4, 119; Pub. L. No. 116-260,
div. N, tit. II, § 261(a)(1), 134 Stat. 1182, 1961.
339See Department of Labor, Continued Assistance for Unemployed Workers (Continued Assistance) Act of 2020 – Federal
Pandemic Unemployment Compensation (FPUC) Program Reauthorization and Modiﬁcation and Mixed Earners Unemployment
Compensation (MEUC) Program Operating, Reporting, and Financial Instructions, Unemployment Insurance Program Letter
(UIPL) 15-20, Change 3 (Washington, D.C.: Jan. 5, 2021).
340As of March 3, 2021, Idaho and South Dakota had opted not to participate in the MEUC program, according to DOL.
Page 234
GAO-21-387

implement the MEUC program, they will be reporting monthly data to DOL on MEUC claims,
including the number of initial claims, the number determined eligible, and the number of weeks
compensated.
The MEUC program is intended to cover individuals who have suﬃcient earnings to qualify
for regular UI, but whose regular UI beneﬁts do not account for signiﬁcant self-employment
income, according to DOL. Individuals who qualify for regular UI are not eligible for PUA, and self-
employment earnings are not considered when determining their regular UI beneﬁts. Thus, certain
individuals may receive a lower regular UI beneﬁt than the beneﬁt they would have received under
PUA based on their self-employment earnings, had they been eligible for PUA.
For example, individuals who work in the performing arts may earn a majority of their income
from performance gigs as independent contractors or self-employed individuals, and then
supplement this income by working part-time at a restaurant. These part-time wages may make
the individual eligible for regular UI beneﬁts, and thus ineligible for PUA beneﬁts. In 44 of 53 states
and territories, the minimum weekly beneﬁt for the regular UI program is below $100.341 If this
individual instead qualiﬁed for the PUA beneﬁt based on their self-employment income, they
would be eligible for at least the PUA minimum beneﬁt, which is generally above $100 per week,
and might be eligible for more than the minimum beneﬁt, depending on their prior earnings.342
Under the MEUC program, certain claimants may now receive an additional $100 weekly to
supplement their regular UI beneﬁts.
Backlogs in processing historic numbers of claims have led to delays in eligible claimants
receiving their ﬁrst beneﬁts, though payment timeliness has been improving. The timeliness
of ﬁrst payments of regular UI beneﬁts declined substantially during the pandemic (see ﬁgure), as
states received historically high numbers of claims, which resulted in extensive claims processing
backlogs.343 Among regular UI claimants nationwide who received their ﬁrst beneﬁt payments
in June 2020, about half had been waiting longer than 21 days since their ﬁrst week of eligibility,
according to DOL’s state-reported data. This represents a precipitous drop from the ﬁrst 3 months
of 2020, which reﬂect UI eligibility prior to the pandemic, when overall more than 90 percent
341Minimum weekly beneﬁts are based on state laws and regulations as reported to DOL, eﬀective July 2020. See
Department of Labor, Signiﬁcant Provisions of State Unemployment Insurance Laws Eﬀective July 2020 (Washington, D.C.).
342Minimum weekly PUA beneﬁts are greater than $100 in 52 of 53 states and territories. Department of Labor,
Minimum Disaster Unemployment Assistance (DUA) Weekly Beneﬁt Amount: January 1 - March 31, 2020, Unemployment
Insurance Program Letter (UIPL) 3-20 (Washington, D.C.: Dec. 12, 2019). According to DOL, states must use the amounts
set in UIPL 3-20 as the minimum weekly beneﬁt amount for all PUA claims. See Department of Labor, Coronavirus Aid,
Relief, and Economic Security (CARES) Act of 2020 – Pandemic Unemployment Assistance (PUA) Program Reporting Instructions
and Questions and Answers, Unemployment Insurance Program Letter (UIPL) 16-20, Change 1 (Washington, D.C.: Apr. 27,
2020).
343DOL monitors timeliness of beneﬁt payments in the regular UI program. One of DOL’s core performance measures
is the percentage of all regular UI ﬁrst payments made within either 14 or 21 days of the ﬁrst week of beneﬁts for
which claimants are eligible. DOL uses 14 days as the timeliness goal for states with a waiting week requirement and
21 days for states without a waiting week requirement. According to DOL, some states require that individuals who are
otherwise eligible for beneﬁts, serve a waiting period—generally one week—before receiving beneﬁts. In its guidance
released at the start of the pandemic, DOL recommended that states consider temporarily waiving their waiting week
requirements. Thus, we focus on payments made within 21 days. We analyzed ﬁrst payment timeliness data reported by
states to DOL as of March 15, 2021, at which point just 25 of the 53 states and territories had reported data for February
2021. Thus, we analyzed data through January 2021; 52 of 53 states and territories had reported data for January 2021.
Page 235
GAO-21-387

of ﬁrst payments were made within 21 days. In addition, nationwide, in October 2020, about a
quarter of claimants who received their ﬁrst beneﬁt payments that month had been waiting longer
than 70 days; in the 3 months prior to the pandemic, less than 1 percent of ﬁrst payments took
this long.
First payment timeliness improved in late 2020 and early 2021 (see ﬁgure). Among regular UI
claimants nationwide who received their ﬁrst beneﬁt payments in January 2021, about 78 percent
were paid within 21 days of their ﬁrst week of eligibility. However, the extension of the CARES Act
UI programs at the end of 2020 could impact payment timeliness if states had to reassign staﬀ
or focus resources on implementing new program requirements, according to DOL oﬃcials. In
addition, timeliness of regular UI ﬁrst payments varies by state (see ﬁgure). For example, 11 states
reported that at least 87 percent of their regular UI ﬁrst payments in January 2021 were paid
within 21 days—DOL’s general benchmark for acceptable performance.344
On the other hand, 4 states reported paying less than half of their claims within 21 days,
suggesting that several states continue to struggle to reach their pre-pandemic levels for timely
payments. Further, oﬃcials we interviewed in a couple states told us that as of late 2020 and
early 2021, backlogs in claims processing still exist. As eligible claims among these backlogs are
processed, ﬁrst payment timeliness in these states may decline, depending on how long these
claims had been waiting to be processed.
Timeliness of First Payments of Regular Unemployment Insurance (UI) Beneﬁts, January 2020 through January
2021
Notes: We analyzed ﬁrst payment timeliness data that include reporting and adjustments submitted by states as of March
15, 2021, at which point just 25 of the 53 states and territories had reported data for February 2021. Thus, we analyzed data
344For its core performance measure, DOL determined that states must pay at least 87 percent of claims within 14 or 21
days to reach an acceptable level of performance.
Page 236
GAO-21-387

through January 2021; 52 of 53 states and territories had reported data for January 2021. The line graph represents the
percentage of regular UI ﬁrst beneﬁts paid within 21 days, nationwide. The pie charts depict how many of the 53 states and
territories paid a given percentage of ﬁrst beneﬁts within 21 days. One of DOL’s core performance measures is the percentage
of all regular UI ﬁrst payments made within either 14 or 21 days of the ﬁrst week of beneﬁts for which claimants are eligible,
depending on whether the state has a waiting week requirement. We focus on payments made within 21 days because in
guidance released at the start of the pandemic, DOL recommended that states consider temporarily waiving their waiting week
requirements. Our pie charts include a category for states that paid at least 87 percent within 21 days because states must pay
at least 87 percent of claims within 14 or 21 days to reach an acceptable level of performance, according to DOL.
As we have previously reported, although DOL has not tracked the timeliness of payments in
the temporary PUA program, DOL oﬃcials told us that states have struggled with making PUA
payments in a timely manner. For example, they said regional oﬃcials had observed a number of
implementation challenges at the state level that likely contributed to claims processing backlogs
and payment delays. In addition, according to DOL oﬃcials, the PUA program changes enacted in
the Consolidated Appropriations Act, 2021 are likely to slow the payment of PUA beneﬁts as states
focus on implementing the new program integrity provisions, for example.
More than half of states submitting data continue to report average PUA beneﬁts paid that
are close to the minimum amount. As of March 15, 2021, 26 of the 43 states and territories
that had submitted PUA payment data for January 2021 reported average weekly PUA beneﬁts
paid that were within 25 percent of the state’s minimum PUA beneﬁt amount; 14 of these states
and territories reported average beneﬁts within 10 percent of the minimum.345 This suggests that
many individuals in these states and territories were receiving the minimum beneﬁt in January
2021—because the average is close to the minimum.
As we reported in November 2020, DOL oﬃcials told us that to facilitate implementation of the
new program, most states decided to initially pay PUA claimants the minimum allowable beneﬁt,
and then recalculate beneﬁts at a later point based on claimants’ documentation of their prior
earnings, as set by DOL guidance.346 States have previously used this approach to pay beneﬁts
more expediently under the Disaster Unemployment Assistance program, according to DOL
oﬃcials. As of March 16, 2021, oﬃcials told us that DOL’s regional oﬃces were monitoring this
issue closely, but because the monitoring is ongoing, they did not know how many states had
begun recalculating individuals’ beneﬁts and making these back-payments.
345We calculated PUA average beneﬁt amounts by dividing the state-reported monthly amounts for total compensation
paid by total weeks compensated. Beneﬁt amounts are based on data reported by states as of March 15, 2021, at
which point 9 states had reported PUA data for February 2021. Thus, we analyzed beneﬁt payment data for January
2021. The following states and territories did not report PUA monthly amount compensated data for January 2021:
Alabama, Arizona, Colorado, Delaware, Florida, Kansas, Maryland, Puerto Rico, South Carolina, and Vermont. The
minimum beneﬁt for PUA aligns with the minimum beneﬁt for the Disaster Unemployment Assistance program and
is set in Unemployment Insurance Program Letter (UIPL) 3-20. Department of Labor, Minimum Disaster Unemployment
Assistance (DUA) Weekly Beneﬁt Amount: January 1 - March 31, 2020, Unemployment Insurance Program Letter (UIPL) 3-20
(Washington, D.C.: Dec. 12, 2019). According to DOL, states must use the amounts set in UIPL 3-20 as the minimum
weekly beneﬁt amount for all PUA claims. For this analysis, we compared the PUA minimum weekly beneﬁt amounts in
UIPL 3-20 to PUA average weekly beneﬁt amounts, by state.
346DOL guidance notes that when individuals submit suﬃcient documentation of wages, states must immediately
recalculate their weekly beneﬁts and pay the full PUA beneﬁt amount with the greatest promptness that is
administratively feasible. Department of Labor, CARES Act of 2020 – Pandemic Unemployment Assistance (PUA) Program
Reporting Instructions and Questions and Answers, Unemployment Insurance Program Letter (UIPL) 16-20, Change 1
(Washington, D.C.: Apr. 27, 2020); see also 20 C.F.R. § 625.9(e). Under the CARES Act, the regulations for DUA generally
apply to PUA. Pub. L. No. 116-136, § 2102(h), 134 Stat. 281, 317.
Page 237
GAO-21-387

States have taken diﬀerent approaches to calculate PUA beneﬁts, according to oﬃcials in a couple
states. For example:
• Oﬃcials from Florida’s Department of Economic Opportunity said that they initially paid
eligible PUA claimants the minimum weekly beneﬁt. They said they have faced challenges
in determining if claimants qualify for a higher beneﬁt amount because claimants often
submit varied documentation of prior earnings—in many cases showing gross income—that
oﬃcials must piece together to determine net income, which is needed to recalculate beneﬁts.
Oﬃcials also said recalculating the weekly beneﬁt amount for each claim in a timely manner is
challenging due to the large number of claims that need to be manually reviewed.
• Oﬃcials from Wyoming’s Department of Workforce Services said that they have used
claimants’ estimates of their prior income to calculate initial PUA beneﬁt payments. Wyoming
oﬃcials stated that individuals have 21 days to provide suﬃcient documentation to verify their
estimate of prior income, and if not provided, the state reduces PUA claimants’ beneﬁts to
the minimum amount. State oﬃcials said they often had to correspond back and forth with
claimants to obtain suﬃcient documentation.
States are continuing to take out substantial federal loans to pay UI beneﬁts. As the number
of regular UI continued claims remains historically high, states continue to face ﬁnancial strain,
and some have sought loans from the federal government to pay UI beneﬁts.347 As of March
12, 2021, about a year since the March 2020 spike in UI claims, 20 states and territories held
federal loans totaling about $52.1 billion (see ﬁgure).348 This total loan balance is greater than
the approximately $40.2 billion held by 30 states and territories at the end of 2010, the height of
borrowing after the 18-month long 2007-2009 recession and early recovery.349 If unemployment
remains high, additional states may have to take out loans to pay UI beneﬁts, and states with
existing loans may need to borrow more.
347While the CARES Act UI programs were federally funded, regular UI is primarily funded through state and federal
taxes on employers. When a state exhausts the funds available for regular UI beneﬁts, it may borrow from the federal
government. According to DOL data, even before the pandemic, many states were not taking in enough UI tax revenue
to satisfy the solvency standard speciﬁed in DOL regulations providing for interest-free loans to states. See 20 C.F.R. §
606.32 (2019).
348According to DOL, the U.S. Virgin Islands had a residual loan balance of about $0.06 billion at the beginning of 2020
left from the 2007-2009 recession, and did not begin borrowing during the COVID-19 pandemic until August 2020.
349According to the National Bureau of Economic Research, the 2007-2009 recession began in December 2007 and
ended in June 2009.
Page 238
GAO-21-387

Total Federal Loan Balance Held by States and Territories to Pay Unemployment Insurance (UI) Beneﬁts, January
3, 2020 through March 12, 2021
Notes: The 20 states and territories with outstanding federal loans to pay UI beneﬁts as of March 12, 2021 were California,
Colorado, Connecticut, Hawaii, Illinois, Kentucky, Louisiana, Maryland, Massachusetts, Minnesota, Nevada, New Jersey, New
Mexico, New York, Ohio, Pennsylvania, Texas, U.S. Virgin Islands, Virginia, and West Virginia. The loan amounts shown in the
ﬁgure represent the total balance held by all of these states and territories as of the end of each week. According to the
Department of Labor, the U.S. Virgin Islands had a residual loan balance of about $0.06 billion at the beginning of 2020 left
from the 2007-2009 recession, and did not begin borrowing during the COVID-19 pandemic until August 2020.
Some states are using funding under the CARES Act to pay oﬀ or prevent large loan balances, as
high balances can lead to federal tax increases for employers. The regular UI program is funded
through state and federal taxes on employers.350 Generally, if a state holds a federal loan balance
to pay UI beneﬁts for two or more years, the rate of the federal tax on employers used to fund the
UI program will increase.351 As we reported in November 2020, states may take years to pay oﬀ
large loan balances.
350According to DOL oﬃcials, the federal tax primarily supports the administration of the program, while the state taxes
fund the beneﬁts.
351Under the Federal Unemployment Tax Act (FUTA), employers are generally required to pay a federal unemployment
tax at a rate of 6.0 percent on the ﬁrst $7,000 of wages paid to an employee each year, which funds administrative costs
associated with the regular UI program and the federal share of beneﬁts paid under the Extended Beneﬁts program,
among other things. FUTA provides a credit of up to 5.4 percent against federal tax liability to employers who pay
state taxes timely under an approved state UI program. If a state has outstanding loan balances on January 1 for two
consecutive years, and does not repay the full amount of its loans by November 10 of the second year, the FUTA credit
rate for employers in that state will be reduced. Thus, the federal taxes paid by employers will increase, all else equal.
Page 239
GAO-21-387

Some states have been using CARES Act funding from the Coronavirus Relief Fund to pay for
UI beneﬁts to reduce their federal loan balance or avoid taking out loans, under guidance from
the Department of the Treasury.352 For example, in October 2020, the Georgia Department of
Labor announced a plan to allocate up to $1.5 billion from its Coronavirus Relief Fund payment
to the state’s UI program.353 According to the Georgia Department of Labor, this plan aimed to
repay federal funds that Georgia borrowed to pay UI beneﬁts during the pandemic, which would
prevent increases in federal unemployment taxes, resulting in an estimated savings of millions of
dollars annually for Georgia employers. Similarly, as of March 15, 2021, West Virginia had planned
to allocate $587 million of its $1.25 billion payment from the Coronavirus Relief Fund to pay UI
beneﬁts, according to the West Virginia State Auditor’s website.354 Given the persistently high
levels of regular UI continued claims, states may continue to use funding under the CARES Act
to pay oﬀ or prevent large loan balances, and avoid possible future increases in employer tax
rates.355
DOL continues to stress the importance of addressing potential fraud in the UI programs.
As we have previously reported, in September 2020, DOL provided states with $100 million in
administrative funding targeted speciﬁcally at addressing potential fraud and identity theft in the
PUA and PEUC programs. In January 2021, DOL announced the availability of an additional $100
million in administrative funding to assist states with, among other things, carrying out a provision
in the Consolidated Appropriations Act, 2021 that requires states to conduct identity veriﬁcation or
validation of PUA claimants.356
States can use this funding to cover administrative expenses for tools or services to verify
or validate the identity of PUA claimants, assist with eﬀorts to prevent and detect fraud and
imposter claims resulting from identity theft in the PUA and PEUC programs, and recover
fraud overpayments in the PUA and PEUC programs. DOL is monitoring states’ use of funds
352According to the Department of the Treasury, the CARES Act established the $150 billion Coronavirus Relief Fund
to provide payments to state, local, territorial, and tribal governments to cover the costs of necessary expenditures
incurred due to the COVID-19 pandemic. In its guidance on the Coronavirus Relief Fund, the Department of the Treasury
reported that states may use this funding to make payments to their state UI trust funds to prevent expenses related
to the COVID-19 public health emergency from causing these UI trust funds to become insolvent. On January 15, 2021,
the Department of the Treasury re-published in a ﬁnal form the guidance it had previously made available on its website
regarding the Coronavirus Relief Fund. Prior to publication in the Federal Register, the last version of its guidance and
frequently asked questions documents were dated September 2, 2020 and October 19, 2020, respectively. 86 Fed. Reg.
4,182 (Jan. 15, 2021).
353On December 11, 2020, Georgia held loans to pay UI beneﬁts totaling almost $886 million. By the end of 2020,
Georgia no longer held outstanding federal loans for UI beneﬁts. Georgia again took out loans during the ﬁrst couple
months of 2021, and held about $103 million in federal loans to pay UI beneﬁts as of March 5, 2021. However, as of
March 12, 2021, Georgia had paid these loans and held no balance.
354The West Virginia State Auditor’s Oﬃce is monitoring coronavirus expenditures on its COVID-19 Transparency
webpage. West Virginia State Auditor’s Oﬃce, “West Virginia COVID-19 Transparency,” accessed March 16, 2021, https://
stories.opengov.com/westvirginia/published/mnOzKr2wB.
355As of December 31, 2020, the Department of the Treasury reported that it had obligated all of the $150 billion from
the Coronavirus Relief Fund to state, local, territorial, and tribal governments. The Consolidated Appropriations Act, 2021
extended the period for states and other entities to use these funds through December 31, 2021. Pub. L. No. 116-260,
div. N, tit. X, § 1001, 134 Stat. 1182, 2145.
356Pub. L. No. 116-260, div. N, tit. II, § 242(a), 134 Stat. 1182, 1960.
Page 240
GAO-21-387

and progress in carrying out these eﬀorts through quarterly reports from states. In addition
to providing funding to states, DOL oﬃcials told us in February 2021 that DOL continues to
emphasize the importance of UI program integrity through published guidance and webinar
presentations.
DOL’s Oﬃce of Inspector General (OIG) and the Department of Justice (DOJ), also continue to
investigate potential UI fraud and examine program integrity issues. In February 2021, the DOL
OIG reported that its analysis of state UI claims data for 35 states or territories identiﬁed more
than $5.4 billion in potentially fraudulent UI beneﬁts paid to individuals from March 2020 through
October 2020, based on four types of potential fraud.357 These include: (1) multi-state claims, in
which individuals use the same Social Security number to ﬁle claims in multiple states; (2) claims
ﬁled using the Social Security number of deceased individuals; (3) claims ﬁled by federal prisoners;
and (4) claims ﬁled using suspicious email accounts. According to the DOL OIG, the $5.4 billion
only represents a subset of potential fraudulent activities. The DOL OIG expects the total amount
of potential UI fraud across all states and territories is much larger.
According to DOJ, from March 2020 through January 2021, DOJ ﬁled federal charges against
92 individuals for defrauding the UI programs.358 In that same time frame, an additional 11
individuals pleaded guilty to federal charges of defrauding the UI programs. See the enclosure on
Federal Fraud-Related Cases in appendix I for more information on DOJ charges.
In response to the Consolidated Appropriations Act, 2021, states have been focused on
implementing new UI program integrity provisions related to identifying and preventing potential
UI fraud, according to oﬃcials from the National Association of State Workforce Agencies (NASWA)
and its UI Integrity Center, funded by and operated in partnership with DOL. For example, NASWA
oﬃcials told us that all states have some process for verifying claimant identities, which is one of
the new PUA program integrity provisions. Some states have faced challenges related to identity
and employment veriﬁcation, according to oﬃcials, such as lacking the technology for claimants to
upload documentation electronically and identifying potentially fraudulent documents.
States have increased their utilization of the Integrity Data Hub to identify potential fraud in the UI
system, according to DOL and NASWA oﬃcials. DOL oﬃcials told us that as of February 19, 2021,
33 states were sending their UI claimant data to the Integrity Data Hub for cross-matching with
other states’ claims data and 22 states were using the Integrity Data Hub’s third-party identity
veriﬁcation services. NASWA oﬃcials told us that cross-matching can identify potentially fraudulent
UI claims, such as instances where a single bank account or email address is associated with
multiple claims in multiple states, or when a deceased individual’s information is used to ﬁle a
fraudulent claim for beneﬁts.
States have also pursued investigations and prosecutions of potential fraud related to the UI
programs during the pandemic. For example:
357Department of Labor Oﬃce of Inspector General, Alert Memorandum: The Employment and Training Administration (ETA)
Needs to Ensure State Workforce Agencies (SWA) Implement Eﬀective Unemployment Insurance Program Fraud Controls for High
Risk Areas, Report Number 19-21-002-03-315 (Washington, D.C.: Feb. 22, 2021).
358Federal charges refer to criminal complaints and indictments. A charge is merely an allegation, and all defendants are
presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Page 241
GAO-21-387

• Oﬃcials we spoke with at the Arizona Attorney General’s Oﬃce said that the large volume
of UI fraud cases has been a major challenge during the COVID-19 pandemic. Oﬃcials said
that they are pursuing some UI fraud cases independently, some through a state task force in
coordination with the Arizona Department of Economic Security, and some through a federal
COVID-19 task force. Arizona oﬃcials expressed appreciation for the federal task force, which
they said involves numerous federal, state, and local agencies, such as DOJ, the Social Security
Administration, U.S. Postal Inspectors, state police, and local law enforcement.
• An oﬃcial with the Massachusetts Attorney General’s Oﬃce said that the state’s UI fraud
investigations primarily focus on three categories: (1) imposter fraud, in which perpetrators
use individuals’ personal information without authorization to collect beneﬁts; (2) fraud
involving perpetrators who "assist" individuals in opening UI claims and take a percentage
of the beneﬁts, which is a signiﬁcant issue in communities where English is not the primary
language; and (3) fraud involving perpetrators who organize vulnerable populations, such
as the homeless, to ﬁle false UI claims and take a percentage of the beneﬁts. The oﬃcial
also stated that conducting certain investigative work, such as interviews, in the midst of a
pandemic has been a challenge for the Attorney General’s oﬃce.
DOL has taken steps to collect data on the recovery of PUA overpayments, but additional
eﬀorts are needed to track the amount of PUA overpayments states have waived.
Overpayments are not necessarily a result of fraud, though some may be.359 As we reported in
January 2021, DOL data show that the dollar amount of reported overpayments in the regular UI
program increased substantially during the pandemic, coinciding with historically high numbers
of UI claims. As of March 15, 2021, DOL reported that states had identiﬁed about $2.6 billion in
regular UI overpayments during the pandemic, in the ﬁnal 3 quarters of 2020 combined.360 As of
March 15, 2021, states that had submitted data to DOL also reported about $3.6 billion in PUA
overpayments from March 2020 through February 2021.361 These amounts are likely to increase
as states shift their focus from program implementation and clearing claims processing backlogs
to identifying overpayments, according to DOL oﬃcials.
In response to the recommendation in our January report, DOL has taken steps to collect data
on states’ recovery of PUA overpayments. DOL updated its state reporting requirements for
359Fraud involves obtaining something of value through willful misrepresentation. Some overpayments may be the
result of fraud. However, whether an act is in fact fraud is a determination to be made through the judicial or other
adjudicative systems.
360States may revise the amount of overpayments they have identiﬁed for 3 years after the reporting quarter,
according to DOL. According to DOL, overpayments include those in the regular UI, Extended Beneﬁts, and emergency
unemployment compensation programs (speciﬁcally, those programs enacted during the 2007-2009 recession,
according to oﬃcials), and exclude overpayments that have been waived. According to DOL, states may waive a non-
fraud overpayment, in accordance with state law, if the overpayment was not the fault of the claimant and requiring
repayment would be against equity and good conscience or would otherwise defeat the purpose of the UI law.
361We accessed the PUA overpayments data on March 15, 2021; these data are subject to change as more states report
data and states revise previously reported data. The number of states that have reported PUA overpayments data
varies by month; for example, 1 state reported overpayment amounts in March 2020, 15 states reported overpayment
amounts in April 2020, 35 states reported overpayment amounts in January 2021, and 7 states reported overpayment
amounts in February 2021. Among the states reporting data, we identiﬁed wide variation in the amount of PUA
overpayments reported in any given month.
Page 242
GAO-21-387

the PUA program to include the collection of data on the amount of PUA overpayments states
have recovered. As of March 15, 2021, 14 states had reported some data on PUA overpayments
recovered in either December 2020 or January or February 2021. Sustained collection of these
data will help inform policymakers about the program, determine the eﬀectiveness of identity
theft prevention eﬀorts, and assess additional program integrity needs, according to DOL.
However, additional data on the amounts of PUA overpayments states have waived are
also needed to eﬀectively monitor the recovery of overpayments. DOL did not include PUA
overpayments waived in the updated state reporting requirements issued in early 2021 because,
according to oﬃcials, the agency needed to quickly issue guidance on new PUA provisions in the
Consolidated Appropriations Act, 2021. In early February, DOL oﬃcials told us they did not have
plans to collect data on which states are utilizing the authority to waive PUA overpayments or the
amount of overpayments that states have waived.362 In a subsequent meeting in late February,
DOL oﬃcials responded that they were developing requirements for states to report these
data, which would be included in a future round of guidance. Federal internal control standards
state that management should use quality information to achieve the entity’s objectives. As
part of these standards, management should obtain data on a timely basis to use for eﬀective
monitoring. For the regular UI program, the amount of overpayments waived is a key data element
used to calculate the percent of overpayments recovered, which is one of DOL’s regular UI
program integrity core performance measures.
The large amount of already-reported PUA overpayments (about $3.6 billion as of March 15, 2021)
indicates the need for timely data to monitor and support states’ use of overpayment waivers.
According to DOL, states are able to retroactively waive PUA overpayments from the beginning of
the program onward. Waived overpayments do not have to be recovered. Thus, additional data on
waived overpayments would enable DOL, policymakers, and the public to accurately determine
the percent of PUA overpayments recovered, how much remains outstanding, and how much
overpaid federal funding states do not intend to recoup.
Agency Comments
We provided DOL and the Oﬃce of Management and Budget (OMB) with a draft of this enclosure.
OMB did not have any comments on this enclosure. DOL provided written comments, reproduced
in appendix IX, and technical comments, which we incorporated as appropriate.
DOL agreed with our recommendation to collect data from states on the amount of PUA
overpayments states have waived. In its comments, DOL noted that the agency has issued
guidance to states regarding their authority to waive PUA overpayments. DOL intends to issue
additional PUA program guidance in April 2021 that will include revised reporting requirements
and instructions for states to provide information on the amount of overpayments waived.
362According to the Consolidated Appropriations Act, 2021, if an individual receives PUA beneﬁts they were not entitled
to, the state must generally require such individuals to repay the amount, but the state can waive that requirement if the
individual was without fault and repayment would be contrary to equity and good conscience. Pub. L. No. 116-260, div.
N, tit. II, § 201(d), 134 Stat. 1182, 1952.
Page 243
GAO-21-387

Methodology
To conduct this work, we analyzed regularly reported DOL data for calendar years 2019, 2020, and
2021, with the most recent data being obtained on March 18, 2021. We reviewed relevant federal
laws, DOL guidance, and DOL Oﬃce of Inspector General reports; and interviewed DOL oﬃcials
about program data and agency actions. We also interviewed oﬃcials from a few states and
worker advocacy organizations as part of our ongoing work on UI during the pandemic, including
oﬃcials from Arizona, Florida, Massachusetts, and Wyoming. We used selected information
from these interviews as illustrative examples. We reviewed data ﬁle documentation and written
responses from DOL oﬃcials, and interviewed DOL oﬃcials about the UI database, PUA claims
data ﬁles, and data on outstanding federal loans to pay UI beneﬁts, speciﬁcally related to state-
reported data on claims counts, overpayments, payment timeliness, and loan balance amounts by
state. We also examined the data for outliers, missing values, and errors. We determined the DOL
data we used were suﬃciently reliable for the purposes of this report.
Contact information: Thomas M. Costa, (202) 512-7215, costat@gao.gov
Related GAO Product
Standards for Internal Control in the Federal Government. GAO-14-704G. Washington, D.C.:
September 10, 2014.
Page 244
GAO-21-387

Economic Impact Payments
The Department of the Treasury and the Internal Revenue Service quickly issued the second round
of direct payments to most eligible individuals, but could do more to fully implement past GAO
recommendations to reach the estimated 8 million who have yet to receive a payment and timely
ensure that direct payment control activities are designed and implemented appropriately.
Entities involved: Internal Revenue Service and Bureau of the Fiscal Service, within the
Department of the Treasury
Recommendation for Executive Action
The Commissioner of Internal Revenue should periodically review control activities for issuing
direct payments to individuals to determine that the activities are designed and implemented
appropriately as IRS disburses a third round of Economic Impact Payments and prepares for
advance payments on the Child Tax Credit. These control activities should include appropriate
testing procedures, quality assurance reviews, and processes that ensure payments distributed
by tax partners reach the intended recipients. IRS disagreed with this recommendation. IRS
also stated it plans to assess the eﬀectiveness of these new controls during the next round of
Economic Impact Payments and will adjust them as warranted.
Key Considerations and Future GAO Work
The Department of the Treasury (Treasury) and Internal Revenue Service (IRS) have taken actions
to implement our four previous recommendations related to the economic impact payments (EIP):
In June 2020, we reported that Treasury and IRS had sent $1.2 billion in the ﬁrst round of Economic
Impact Payments (EIP 1) to deceased individuals. We recommended that the Commissioner of
Internal Revenue should consider cost-eﬀective options for notifying ineligible recipients on
how to return payments. Treasury and IRS have taken steps to implement our recommendation.
For example, IRS has instructions on its website requesting that individuals voluntarily mail the
appropriate EIP amount sent to the decedent back to IRS, for both electronic and paper check
payments. The envelopes in which paper checks were sent also had a checkbox so people could
indicate that the intended recipient was deceased, and then mail the envelope back. Treasury has
also held and cancelled payments made to decedents, along with those that have been returned.
As of February 28, 2021, around 57 percent (just over $703 million) of the $1.2 billion in EIP 1 sent
to deceased individuals had been recovered. The recovered amount has not changed since August
2020.
As of March 2021, Treasury and IRS have not taken any further action to recoup payments made
to decedents that have not been returned. IRS oﬃcials determined that further actions, such as
initiating erroneous refund cases against the estates of the decedents to which payments were
made and not returned, could be burdensome to taxpayers, the federal court system and IRS. As
such, IRS oﬃcials concluded that doing so is not prudent at this time.
In our September 2020 report, we made two recommendations to help IRS better target its
outreach and communications eﬀorts to reach the estimated millions of individuals who may
Page 245
GAO-21-387

be eligible for a payment but have not received one. Speciﬁcally, we recommended that the
Secretary of the Treasury, in coordination with the Commissioner of Internal Revenue, should
update and reﬁne the estimate of eligible recipients who have yet to ﬁle for an EIP 1 to help target
outreach and communications eﬀorts. We also recommended that the Secretary of the Treasury,
in coordination with the Commissioner of Internal Revenue, should then make this estimate along
with other relevant information, available to outreach partners to raise awareness about how and
when individuals can ﬁle for an EIP 1.
Treasury and IRS neither agreed nor disagreed with our recommendations, but did take some
actions that are consistent with our recommendations. For example, in September 2020, the
agencies used tax return information to identify nearly 9 million individuals who had not received
an EIP 1 and then notiﬁed these individuals that they may be eligible for a payment. The letters
also provided instructions on how to request a payment. In addition, IRS publicly released detailed
ZIP Code data from the notices to help community outreach partners with their own outreach
eﬀorts.
In January 2021, Treasury revised its estimate of eligible recipients who have yet to ﬁle for an EIP 1
to 8 million. According to Treasury oﬃcials, this estimate is based on the 9 million notices IRS sent
in September 2020. Treasury oﬃcials stated that it is likely that some of the 9 million recipients
have since claimed the EIP, but Treasury did not provide data supporting this claim.
Treasury and IRS did not initially plan to monitor the eﬀectiveness of the outreach notices that
were sent in September until February or March 2021. In November 2020, we recommended
that the Secretary of the Treasury, in coordination with the Commissioner of Internal Revenue,
should begin tracking and publicly reporting the number of individuals who were mailed an EIP
1 notiﬁcation letter and subsequently ﬁled for and received an EIP 1, and use that information to
inform ongoing outreach and communications eﬀorts.
Treasury and IRS agreed with this recommendation. According to Treasury oﬃcials, Treasury
began analyzing data in January 2021 on those individuals who received a notice and subsequently
ﬁled for and received an EIP 1. As of the time of this report, Treasury’s analysis of these data
is ongoing. Treasury has not reported any results or provided a timeline for when it plans to
complete the analysis.
On January 22, 2021, the President issued Executive Order on Economic Relief Related to the COVID-19
Pandemic to provide economic relief to the millions of Americans aﬀected by COVID-19, which
directs agencies to prioritize actions that provide relief to individuals and families, among
others.363 We discuss actions Treasury and IRS are taking to expand and improve delivery of EIPs
further below.
On March 10, 2021, Congress passed the American Rescue Plan Act of 2021, which the President
signed on March 11, 2021. The statute authorized a third round of direct payments to individuals
to help address ﬁnancial stress due to the pandemic.364 Treasury and IRS begin dispersing EIP
3 payments on March 12, 2021. As of March 19, IRS reported that it had dispersed 127.3 million
payments totaling over $325 billion.
363Executive Order 14002, 86 Fed. Reg. 7229 (Jan. 27, 2021).
364Pub. L. No. 117-2, § 9601, 135 Stat. 4, 138–144.
Page 246
GAO-21-387

The statute also increased the amount of the Child Tax Credit and authorized IRS to send
advanced payments of the credit to eligible individuals.365 We will continue to examine Treasury
and IRS eﬀorts to provide direct payments and advance payments of the Child Tax Credit to
eligible individuals during the 2021 tax ﬁling season. We will also review the eﬀect of selected tax
policies—including provisions in the CARES Act and Tax Cuts and Jobs Act—on households by sex,
race, and ethnicity.
Background
The CARES Act and the Consolidated Appropriations Act, 2021, authorized Treasury and IRS to
issue EIPs as direct payments to help individuals address ﬁnancial stress due to the pandemic. 366
Treasury and IRS quickly issued the second round of direct payments to most eligible individuals.
As of February 28, 2021, Treasury and IRS issued 168.2 million payments totaling $275.9 billion for
the ﬁrst round of payments (EIP 1) and 152.4 million payments totaling $147 billion for the second
round of payments (EIP 2).367 According to IRS data, the average amount of EIP 1 was $1,665 and
the average amount of EIP 2 was $965. From April 2020 through February 2021, the Bureau of the
Fiscal Service (BFS) disbursed the ﬁrst and second payments in the form of direct deposits, paper
checks, and debit cards (see ﬁgure).
365 The statute makes the full Child Tax Credit available to children in families with low earnings or that lack earnings
in a year, and it increases the credit’s maximum amount to $3,000 per child and $3,600 for children under age 6. It also
extends the credit to 17-year-olds. Pub. L. No. 117-2, § 9611, 135 Stat. at 144–150.
366Pub. L. No. 116-136, § 2201, 134 Stat. 281, 335–340 (2020); Pub. L. No. 116-260, § 272, 134 Stat. 1182, 1965–1976
(2020).
367The number of payments is taken from the IRS Master File and includes reissued payments but does not include
payments to residents of territories. The amount of payments is taken from the Treasury general ledger and includes
reversals and payments to the U.S. territories.
Page 247
GAO-21-387

Number of Economic Impact Payments (EIP) Disbursed by Payment Type, Rounds 1 and 2, as of February 5, 2021
In February 2021, IRS announced that all legally permitted ﬁrst and second round of EIPs have
been issued. Eligible individuals who did not receive EIP 1 or EIP 2—or their maximum applicable
EIP 1 and EIP 2 amounts—can claim a recovery rebate credit (RRC) on their tax year 2020 income
tax return equal to the amount of the credit for which they are eligible, as reduced by their EIP 1
and EIP 2 amounts.368
As we previously reported, a number of population groups did not receive timely payments during
the ﬁrst or second round of payments. These groups, which include those who ﬁled a tax return
in 2018 but not 2019, and as such, did not receive an EIP 2, can claim the RRC. However, unlike the
EIP, the RRC can be reduced to pay debts owed to federal or state agencies. The National Taxpayer
Advocate reported that this oﬀset created an inconsistency between the treatment of EIPs and
the treatment of RRCs claimed on 2020 tax returns where the RRC will be reduced by outstanding
liabilities.
According to IRS data, there are an estimated 15 million individuals who ﬁled a tax return in 2018,
but did not ﬁle in 2019, and will have to ﬁle a 2020 tax return to receive their credit. As of March
8, about 600,000 of these individuals ﬁled for and received an RRC. Other groups, such as some
incarcerated individuals, some qualifying widows and widowers, and individuals whose qualifying
children payments were not initially included in EIP 1 and who may not have received the payment
as part of EIP 2, will also have to claim the RRC.
368IRS sent over 1.2 million notices in December 2020 notifying individuals that they had not received their EIP 1
because IRS had not yet processed their 2019 tax return.
Page 248
GAO-21-387

On March 15, 2021, the Taxpayer Advocate Service reported that IRS agreed to use its discretion
to refrain from oﬀsetting RRCs to satisfy federal tax debts. According to IRS, it will update
programming as soon as possible to exercise this authority. IRS is also exploring if it can legally
reverse oﬀsets that have already occurred and refund those amounts to taxpayers. IRS reported it
does not have the authority to bypass debts collected through the Treasury Oﬀset Program.
Overview of Key Issues
Treasury and IRS eﬀorts to expand and improve EIP delivery. As mentioned earlier, on January
22, 2021, the President issued Executive Order on Economic Relief Related to the COVID-19 Pandemic
that called on federal agencies to (i) promptly identify actions to address the economic crisis
resulting from the pandemic and (ii) speciﬁcally consider actions that facilitate better use of data
and other means to improve access to, reduce unnecessary barriers to, and improve coordination
among programs funded in whole or in part by the federal government. The order directed
agencies to prioritize actions that provide the greatest relief to individuals, families, and small
businesses; and to state, local, tribal and territorial governments.
In response to the order, Treasury released a fact sheet to outline eﬀorts Treasury will take to help
households who have not yet been able to access payments. The fact sheet states Treasury will
take the following three actions, in coordination with IRS, to (1) establish online tools for people
who have not ﬁled an income tax return to be able to claim their payments; (2) reach individuals
who were issued an EIP 1 via debit cards or paper checks and have yet to activate or cash them;
and (3) analyze and better understand unserved populations to enhance outreach eﬀorts.
Treasury oﬃcials described a number of actions they plan to take; however, some of these actions
do not diﬀer signiﬁcantly from earlier research and outreach actions Treasury and IRS were
taking for EIP 1 or EIP 2, or actions Treasury and IRS normally take as part of the tax ﬁling season.
For example, Treasury and IRS have not created new online tools for non-ﬁlers, rather they are
promoting existing online options. IRS oﬃcials said that non-ﬁlers can submit a tax return through
the Free File program.369 Treasury oﬃcials also said the Get My Payment Tool on the IRS website
will be available for future EIPs to allow individuals to update their direct deposit information and
receive a status of their payment.
According to BFS oﬃcials, just over 744,500 EIP 1 checks and almost 200,000 EIP 1 debit cards,
totaling around $1.3 billion have not been cashed or activated. Additionally, around 2.8 million
EIP 2 checks and over 1.3 million EIP 2 debit cards have not been cashed or activated, totaling
$3.3 billion. 370 Treasury and IRS oﬃcials said they are continuing their outreach eﬀorts online
and in coordination with community and government outreach partners to reach individuals
who have received but not cashed EIP 1 checks or activated debit cards. In February 2021, the
Bureau of the Fiscal Service sent approximately 200,000 reminder letters to individuals that were
mailed an EIP card in the ﬁrst round of payments but have not yet activated their card. BFS sent
369 Free File, Inc. is a public-private partnership between the IRS and a consortium of tax preparation companies that
provide their products for free if a taxpayer’s adjusted gross income is below a certain level.
370 Approximately 87,000 EIP 1 and 617,000 EIP 2 debit cards have been activated but not used, amounting to over $629
million.
Page 249
GAO-21-387

a similar reminder notice in July 2020. The letter reminds recipients to activate their EIP card or
to call customer service for a free replacement card if they have lost or discarded their EIP card.
BFS oﬃcials said it sent approximately 1.3 million reminder letters on March 4, 2021, to those who
have not yet activated their EIP 2 debit cards.
According to Treasury oﬃcials, Treasury is currently analyzing data on individuals who received
a notice in September 2020 and subsequently ﬁled for and received an EIP 1. Treasury began
this analysis prior to the executive order and fact sheet and following the recommendation we
made in November 2020. However, Treasury and IRS have no plans to conduct further analysis to
better understand traditionally underserved populations and to enhance outreach eﬀorts to those
populations. Fully implementing our September and November recommendations would provide
Treasury and IRS more information on the estimated size of the population who have yet to ﬁle for
an EIP and also potentially provide insights into the eﬀectiveness of diﬀerent targeted outreach
eﬀorts to reach these populations.
IRS oﬃcials have taken some actions to improve delivery of EIP to individuals who are
incarcerated. In November 2020, we reported that approximately 977,000 incarcerated individuals
could be eligible for an EIP. According to IRS oﬃcials, they provided information to the Federal
Bureau of Prisons and state Department of Correctional agencies on how individuals who are
incarcerated could ﬁle for an EIP. IRS also set up a dedicated mailbox to address questions or
concerns relevant to incarcerated individuals.
However, there continue to be challenges delivering timely payments to this population. According
to IRS data, around at least 10,000 incarcerated individuals ﬁled a paper return, but did not
receive their EIP. IRS was unable to process their return in time due to a backlog of paper returns.
According to IRS, these individuals will need to wait until they ﬁle their 2020 tax return, at which
time they can ﬁle for the RRC. IRS sent some incarcerated individuals a debit card, but the prisons
were either unable to process the card or identify who it belonged to. IRS subsequently sent
instructions to those prisons on how to return the debit card and how individuals could ﬁle a 1040
tax return to claim the RRC.
The second round of EIPs are generally protected from levy, attachment, or garnishment.371
According to IRS oﬃcials, this prohibition on garnishments only applies to garnishment orders
that would otherwise be honored and collected by a ﬁnancial institutions and that prisons are not
ﬁnancial institutions. As part of IRS’s outreach, they did not provide information to the Federal
Bureau of Prisons and state Departments of Corrections concerning the statutory protection
against garnishment. According to IRS oﬃcials, what happens to the funds once the payment is
made to the right individual is beyond IRS’s jurisdiction.
Temporary bank accounts. In December 2020, Treasury and IRS sent an estimated 13 to
19 million EIP 2 payments to temporary bank accounts.372 Tax industry partners, such as tax
preparers and tax ﬁnancial services companies, may establish these temporary accounts on behalf
of their clients to receive a tax refund. As a result, millions of individuals, who had used a tax
371Pub. L. No. 116-260, § 272(d)(2)(A), 134 Stat. at 1972.
372IRS conﬁrmed that it sent at least 13 million EIP 2 payments to temporary bank accounts. Tax industry partners
provided us data that at least 5.6 million additional EIP 2 payments were sent to temporary accounts. We did not
independently verify the data we received from tax industry partners.
Page 250
GAO-21-387

preparer to ﬁle their 2019 tax returns experienced a delay of up to a month to receive their EIP 2
payment.
According to IRS, when taxpayers obtain third-party tax preparation services, the return preparer
provides the temporary bank account it established on behalf of the taxpayer to IRS. IRS sends the
refund to this account by direct deposit, the return preparer deducts fees for its tax preparation
services and other products its clients may have purchased and sends the remaining balance of
the refund to the taxpayer. For taxpayers who ﬁle electronically, IRS asks tax preparers to provide
information about taxpayers’ temporary and ultimate bank accounts, the account controlled by
the taxpayer to which the return preparer will deposit the residual refund.
According to IRS, with EIP 1, it found that tax preparers’ did not always provide the correct ultimate
bank account information. In August, 2020, in anticipation of legislation authorizing EIP 2, IRS
worked with several of its tax industry partners to obtain correct banking information for their
clients so that future EIPs issued by direct deposit would not be sent to temporary accounts. IRS
obtained corrected bank account information for approximately 20 million individuals. However,
due to a data formatting issue, IRS uploaded the same account information for some taxpayers as
had been originally provided by the tax preparers when they ﬁled taxpayers’ returns, rather than
the correct ultimate bank account.
IRS did not become aware of the error until December 31, 2020 when their tax industry partners
notiﬁed them that EIP 2 payments had been sent to the temporary accounts. IRS oﬃcials said they
did not perform a quality review of the revised records. According to oﬃcials, they were working
under a compressed time frame, and preparing for the 2021 ﬁling season.
IRS has documented quality review procedures for its operations. However, according to oﬃcials,
they did not consistently follow these procedures for the second round of direct payments.
According to federal standards on internal control, when there is a signiﬁcant change in an
entity’s objectives or process, management should review its policies, procedures, and related
control activities in a timely manner to determine that the control activities are designed and
implemented appropriately. With the enactment of the American Rescue Plan of 2021, which
includes a third round of economic impact payments and advance payments of the Child Tax
Credit, timely reviews of control activities for making direct payments to individuals could help
IRS avoid costly or burdensome errors in the future. For example, control activities could include
appropriate testing procedures, quality assurance reviews, and processes that ensure payments
distributed by tax partners reach the intended recipients.
According to IRS, upon learning that the EIPs had been sent to the temporary accounts, oﬃcials
asked their tax industry partners to reject the payments so that IRS could reissue them either to
the correct bank account or as a paper check. However, according to IRS oﬃcials, some partners
did not return the payments. Instead, two large tax industry partners announced they planned to
redirect the payments to their clients. IRS oﬃcials said this then raised concerns among their other
partners that returning the payments to the IRS instead of redirecting the payments to clients
would put them at a competitive disadvantage.
At the time, IRS’s main processing system was down to prepare for the 2021 tax ﬁling season. IRS
would not be able to reissue payments for about a month until the system was back online on
Page 251
GAO-21-387

January 25, 2021. IRS oﬃcials said industry partners were also concerned that their clients would
have to wait to claim the RRC on their 2020 taxes instead of immediately receiving an EIP 2, and
unlike EIP 2, the RRC can be reduced to pay some debts. Ultimately, IRS oﬃcials concluded that it
had no legal authority to demand tax industry partners return the payments as IRS had sent the
payments to the bank accounts taxpayers identiﬁed on their income tax returns as being accounts
owned and controlled by the taxpayers.
Oﬃcials from two tax industry partners that had the majority of aﬀected clients said they worked
with their clients’ ﬁnancial institutions to redirect most of the EIP 2 payments by January 7, 2021.
For example, one national tax preparer reported that IRS sent 2.8 million payments to temporary
accounts; the company reported that it was able to redirect almost all of those payments to the
correct accounts. The preparer only had to return around 20,000 payments to IRS because it was
unable to verify the ultimate bank account for the recipient. One tax ﬁnancial services company
reported that IRS sent over 11 million payments to temporary accounts; of those payments,
the company reported that they redirected 10.4 million payments to the correct accounts. It
returned 545,000 payments to IRS because it was unable to verify the ultimate bank account for
the recipient.373
Working with BFS, IRS has reissued 5.2 million payments as of January 31, 2021, including those
returned from tax industry partners; this number includes all rejected payments, not just those
sent to the temporary bank accounts. According to IRS oﬃcials, certain tax industry partners have
not yet provided IRS with key information, particularly the number of redirected payments. As of
March 2021, IRS oﬃcials said they do not know the total number of payments sent to temporary
bank accounts; the number of aﬀected recipients that have now received their payment; or the
number that have not yet received a redirected or reissued payment.
To prevent a similar issue from happening in the future, IRS oﬃcials said they have worked with
tax industry partners to provide the ultimate bank account information in a standard format.
Additionally, IRS is working with industry partners to conﬁrm that IRS has the correct bank account
information and is performing tests to validate that information.
Disparities in EIP disbursement related to the sex, race, or ethnicity of households. Certain
demographic groups may be overrepresented in those who have not received EIPs or received
them late because they are overrepresented among populations who did not ﬁle tax returns, did
not have bank accounts, or are incarcerated.374 The ﬁgure below shows our analysis of Census
data of tax non-ﬁlers and unbanked rates among certain racial and ethnic groups. Additionally,
our analysis of Census data estimates the non-ﬁling rate for female-headed households is
373 We did not independently verify these ﬁgures.
374We previously reported on challenges IRS had in delivering EIP payments to non-ﬁlers and unbanked households.
In addition, we reported on steps IRS had been taking assist in the return of payments made to individuals who are
incarcerated, which had been previously withheld. However, IRS does not does not collect demographic data indicating
which households house received the EIP, and data we use do not have household-level demographic data indicating
which households have and have not received EIPs, therefore based on our analyses, it is not conclusive whether there
are disparities in the disbursement of EIP by sex, race, or ethnicity.
Page 252
GAO-21-387

18.4 percent; higher than male headed-households at 11.6 percent.375 The unbanked rate for
individuals by sex also varied by type of household. According to Federal Deposit Insurance
Corporation estimates, unmarried female households had higher unbanked rates at 11.1 percent,
compared with unmarried male households at 7.6 percent.376 In contrast, the estimated unbanked
rate for male individuals was higher at 8.7 percent than for female individuals at 5.8 percent.377
Non-ﬁler and Unbanked Rates by Race and Ethnicity in 2019
Note: We deﬁne a non-ﬁler as the ASEC householder/reference person who indicates a non-ﬁling status. This does not consider
the ﬁling status of any other household members of the householder, including those who might be part of the same or a
diﬀerent family or tax unit. We deﬁne the household race/ethnicity as the householder/reference person’s race/ethnicity.
Unbanked data are unavailable for Hawaiian/Paciﬁc Islander, non-Hispanic because the sample size is too small to produce a
precise estimate. Within a survey, non-overlapping conﬁdence intervals for two estimates indicate estimates are statistically
diﬀerent at the 95 percent conﬁdence level.
In November 2020, we reported that individuals who were incarcerated were at risk of receiving
payments late or not at all. As such, the ﬁnancial impact on racial and ethnic groups could vary.
Imprisonment rates are highest among male, Black, and Hispanic adults. In 2019, the national
imprisonment rate was 539 per 100,000 U.S. adults. However, this varies across demographic
groups—the rate was 77 per 100,000 for female adults, 1,025 for male adults, 263 for White adults,
1,446 for Black adults, and 757 for Hispanic adults.378
375GAO analysis of the U.S. Census Bureau's Current Population Survey March 2020 Annual Social and Economic
Supplement (ASEC). The 95 percent margins of errors for these estimates are within +/- 0.54 percentage points.
376Federal Deposit Insurance Corporation, 2019 FDIC Survey of Household Use of Banking and Financial Services. The 95
percent margins of errors for these estimates are within +/- 1.79 percentage points.
377The 95 percent margins of errors for these estimates are within +/- 0.96 percentage points.
378E. Ann Carson, Prisoners in 2019, NCJ Bulletin 255115 (U.S. Department of Justice, Oﬃce of Justice Programs, Bureau
of Justice Statistics, October 2020). The imprisonment rate is “the number of prisoners sentenced to more than 1 year
under state or federal jurisdiction per 100,000 U.S. residents.”
Page 253
GAO-21-387

We have ongoing work to examine how or whether the administration of certain COVID-19
relief provisions aﬀected households diﬀerentially based on the sex, race, and ethnicity of the
householders.
Agency Comments
We provided a draft of this enclosure to Treasury, IRS, and the Oﬃce of Management and Budget.
Treasury and IRS provided technical comments, which we incorporated as appropriate.
In its comments, reproduced in appendix VIII, IRS disagreed with the recommendation. However,
IRS acknowledged that it established additional procedures and reviews upon discovering that
it had sent millions of payments to the wrong account. IRS also stated it plans to assess the
eﬀectiveness of these new controls during the next round of Economic Impact Payments and will
adjust them as warranted.
As we reported, when there is a signiﬁcant change in an entity’s objectives or process,
management should review its policies, procedures, and related control activities in a timely
manner to determine that the control activities are designed and implemented appropriately. With
the enactment of the American Rescue Plan of 2021, which includes a third round of economic
impact payments and advance payments of the Child Tax Credit, timely reviews of control activities
for making direct payments to individuals before their distribution could help IRS avoid costly or
burdensome errors in the future especially because IRS sent more than 13 million EIP 2 to the
incorrect bank accounts.
IRS also described the commitment on the part of its employees, the many hours they worked
and the actions they took to help deliver two rounds of economic impact payments. IRS is also
taking steps to remind people who did not initially qualify for a payment—or did not receive the
full amount—to ﬁle for the RRC, based on their 2020 circumstances.
Methodology
To review how Treasury and IRS administered EIP 1 and EIP 2 payments, we reviewed Treasury
and IRS data as of February 2021, examined federal laws and agency guidance, and interviewed
Treasury and IRS oﬃcials. We assessed the reliability of this data by reviewing relevant Treasury
and IRS documents, reviewing our prior use of the data sources, and interviewing agency
oﬃcials. We determined the data were suﬃciently reliable to describe the number and amount
of payments disbursed. We also interviewed representatives from H&R Block, Green Dot
Corporation, and the Council for Electronic Revenue Communication Advancement (CERCA) to
understand steps the tax industry took to redirect EIP 2 payments. We obtained the amount of EIP
2 payments that were redirected by two tax industry companies. We did not assess the reliability
of this data.
We also reviewed published data from the Bureau of Justice Statistics and the Federal Deposit
Insurance Corporation. We analyzed Census data from the Current Population Survey March
2020 Annual Social and Economic Supplement (ASEC). We used these data to estimate the rates
Page 254
GAO-21-387

of incarcerated persons, non-ﬁling householders, and unbanked householders by sex, race, and
ethnicity.
Contact information: James R. McTigue Jr., (202) 512-6806, mctiguej@gao.gov
Page 255
GAO-21-387

Nutrition Assistance
Demand for nutrition assistance surged during the pandemic, leading to increases in participation
in and expenditures for key federal nutrition assistance programs, but the Department of
Agriculture did not release data on these programs for 6 months, raising questions about data
quality as the pandemic persists.
Entity involved: Food and Nutrition Service, within the Department of Agriculture
Recommendation for Executive Action
We are making the following recommendation to the Department of Agriculture:
The Secretary of Agriculture should ensure that the Administrator of the Food and Nutrition
Service (1) provides suﬃcient context to help stakeholders and the public understand
and interpret data on federal nutrition assistance programs during the pandemic and (2)
discloses potential sources of error that may aﬀect data quality during the pandemic, such as
manual processing. For example, the agency could publish key information from its internal
communications plan that it developed for the January 2021 data release and include additional
table notes in subsequent data releases to help explain these issues. In its comments, the Food
and Nutrition Service generally concurred with our recommendation.
Key Considerations and Future GAO work
In June 2020, we reported that states and local governments faced challenges operating federal
nutrition assistance programs during the pandemic and that some vulnerable populations may
not have access to assistance. In November 2020, we identiﬁed several additional challenges,
including that the Food and Nutrition Service (FNS) within the Department of Agriculture (USDA)
lacked reliable data on participation and expenditures for some of its nutrition assistance
programs during the pandemic. We will continue to monitor FNS’s eﬀorts to ensure its key
program data are reliable, timely, and publicly available.
We will also continue to monitor FNS’s use of COVID-19 relief funds, as well as the agency’s eﬀorts
to ensure program integrity and the challenges states and local agencies face implementing these
programs.
Background
Expenditures for federal nutrition assistance programs have increased as the negative economic
eﬀects of the COVID-19 pandemic on vulnerable populations have continued. The largest of these
programs—the Supplemental Nutrition Assistance Program (SNAP)—provided approximately
$74 billion in beneﬁts in ﬁscal year 2020, nearly matching the historic high for the program.379
Last ﬁscal year, SNAP participation rose to an average of about 40 million individuals per month,
379In nominal terms, SNAP expenditures peaked in ﬁscal year 2013, when beneﬁts totaled $76.1 billion, according to FNS
data. SNAP expenditures had declined since then, with beneﬁts totaling $55.6 billion in ﬁscal year 2019.
Page 256
GAO-21-387

according to recently released FNS data.380 The Consolidated Appropriations Act, 2021, enacted in
December 2020, provided approximately $101.8 billion to FNS to cover SNAP beneﬁts in ﬁscal year
2021.
FNS administers SNAP and other federal nutrition assistance programs, including the Special
Supplemental Nutrition Program for Women, Infants, and Children (WIC), the Emergency Food
Assistance Program (TEFAP), and the Pandemic Electronic Beneﬁts Transfer (Pandemic EBT)
program—a new program authorized in the Families First Coronavirus Response Act (FFCRA).381
Eligibility criteria vary across FNS’s nutrition assistance programs, and individuals and households
may receive assistance from multiple programs. See table for program descriptions and total
COVID-19 funding provided for these programs, as of January 2021.
380Data presented here are FNS’s preliminary data on SNAP participation and expenditures for ﬁscal year 2020,
released on January 27, 2021. FNS noted that data are subject to signiﬁcant revision. On March 12, 2021, FNS released
additional data covering the ﬁrst two months of ﬁscal year 2021 (October and November 2020). Those data show that, in
November 2020, 41.4 million individuals participated in SNAP and monthly beneﬁts totaled approximately $7.8 billion.
381See Pub. L. No. 116-127, § 1101, 134 Stat. 178, 179-180 (2020).
Page 257
GAO-21-387

Key Information on Federal Nutrition Assistance Programs during the COVID-19 Pandemic, as of January 31, 2021
Program
Description
Total COVID-19 funding
($) a
COVID-19 expenditures as
of January 31, 2021 ($) d
SNAP
Provides low-income individuals and households
with beneﬁts to purchase allowed food items and
achieve a more nutritious diet.
15.6 billionb
15.5 billion
Pandemic
EBT
Provides beneﬁts to purchase food to households
with children who would have received free or
reduced-price school meals if not for school closures
due to COVID-19, as well as to eligible children in
childcare.
12.8 billionc
10.7 billion
WIC
Provides eligible low-income women, infants, and
children up to age 5 who are at nutrition risk with
nutritious foods to supplement diets, information on
healthy eating, and referrals to health care.
500 million
174.3 million
TEFAP
Provides groceries to low-income individuals through
food banks.
1.25 billion
537 million
Source: GAO analysis of relevant provisions of the Families First Coronavirus Response Act, the CARES Act, and the Consolidated Appropriations Act, 2021, and information from the
Department of Agriculture’s Food and Nutrition Service. | GAO-21-387
Notes: Pandemic EBT = Pandemic Electronic Beneﬁts Transfer, SNAP = the Supplemental Nutrition Assistance Program, TEFAP
= the Emergency Food Assistance Program, and WIC = the Special Supplemental Nutrition Program for Women, Infants, and
Children. This table provides information on a selection of programs and is not intended to provide comprehensive information
on all federal nutrition assistance funding provided during the pandemic. For example, Puerto Rico, the Commonwealth of the
Northern Mariana Islands, and American Samoa received $100 million in the Families First Coronavirus Response Act, $200
million in the CARES Act, and $614 million in the Consolidated Appropriations Act, 2021 for nutrition assistance programs, and
we do not present that funding in this table.
aWith respect to funding from the Consolidated Appropriations Act, 2021, the amounts in this column reﬂect amounts
appropriated in Division N, pertaining to COVID-19 response and relief.
bThe Consolidated Appropriations Act, 2021 also provided an indeﬁnite appropriation for FNS to carry out certain COVID-19
relief provisions, including a provision that generally increased SNAP beneﬁts from January through June 2021. The total
here—$15.6 billion—reﬂects only provisions for which FNS received appropriations with speciﬁc dollar amounts. As of January
31, 2021, data were not yet available to determine the extent of additional SNAP funding provided through the indeﬁnite
appropriation.
cPandemic EBT received an indeﬁnite appropriation of necessary amounts. The amount shown here is the apportionment
provided for Pandemic EBT as of January 31, 2021. This amount will increase as states continue to implement Pandemic EBT in
ﬁscal year 2021 and begin to provide beneﬁts to eligible children in childcare.
dAs of January 31, 2021, FNS had not received any Treasury appropriation warrants for funds provided in the Consolidated
Appropriations Act, 2021. Consequently, the data in this column reﬂect expenditures only from funds provided in the Families
First Coronavirus Response Act and the CARES Act.
Recent legislative and executive actions made several changes to federal nutrition assistance
programs. For example, the Consolidated Appropriations Act, 2021 increased SNAP beneﬁts
amounts by 15 percent from January through June 2021 for all participants, according to FNS, and
temporarily expanded eligibility for the program to certain vulnerable populations.382 The act
382Pub. L. No. 116-260, div. N, tit. VII, § 702(a), (e), (h), 134 Stat. 1182, 2092-2094. In March 2021, the American Rescue
Plan Act of 2021 extended the increase in SNAP beneﬁts amounts through September 2021 and provided $1.15 billion
Page 258
GAO-21-387

also created a task force to explore, among other things, options for using WIC beneﬁts online
and provided an additional $400 million to TEFAP.383 In addition, the act changed several aspects
of administering the Pandemic EBT program, including how states should determine if children
in childcare are eligible.384 In January 2021, the President issued an executive order, which led
to FNS increasing Pandemic EBT beneﬁts by approximately 15 percent, among other things. In
March 2021, the American Rescue Plan Act of 2021 made further changes to key federal nutrition
assistance programs, including SNAP and Pandemic EBT, and we will monitor how FNS implements
these changes moving forward.
Overview of Key Issues
FNS did not release key data about nutrition assistance programs until January 2021, and
has not publicly shared suﬃcient information about data quality.
Until late January 2021, FNS had made minimal data available on participation in and expenditures
for its nutrition assistance programs during the pandemic. In August 2020, FNS announced it
had identiﬁed signiﬁcant issues with the quality of state-reported data on SNAP and Pandemic
EBT.385 Speciﬁcally, FNS noted that SNAP participation data might erroneously include Pandemic
EBT participants, leading to larger-than-actual estimates for SNAP participation. At that time, the
most recent reliable data for SNAP were from March 2020 and there were no publicly available
data on Pandemic EBT. Data for WIC and TEFAP were available through April 2020 (published in
July 2020).386 While FNS worked to identify the root cause of the issues, it opted not to release
participation data on its typical schedule for any of its nutrition assistance programs from July
2020 until late January 2021.
On January 27, 2021, FNS published participation and expenditures data for its nutrition assistance
programs through September 2020, including previous months for which the agency had not
released data prior in the pandemic. However, as part of this release, FNS did not publicly explain
how it resolved the data quality issues it previously disclosed in August 2020, nor did the agency
share suﬃcient context to help stakeholders and the public understand and interpret the data.
for SNAP administrative expenses to be available through September 2023, among other provisions. Pub. L. No. 117-2, §
1101(a), 135 Stat. 4, 15.
383The American Rescue Plan Act of 2021 generally authorized USDA to increase the WIC cash-value
voucher—participants can use these vouchers to purchase fruits and vegetables—up to $35 through September 2021
and provided $490 million to carry out this temporary increase. The act also provided $390 million for WIC program
outreach, innovation, and modernization eﬀorts to increase participation and beneﬁt redemption. Pub. L. No. 117-2, §§
1105, 1106, 135 Stat. 4, 16-17.
384The American Rescue Plan Act of 2021 made additional changes to Pandemic EBT, including authorizing USDA to
approve states to operate the program during the summer months and extending the authority of the program in the
event of a future public health emergency. Pub. L. No. 117-2, § 1108(1), 135 Stat. 4, 18.
385Similarly, in its ﬁscal year 2020 Annual Financial Report, USDA acknowledged that data availability and quality, as well
as antiquated reporting systems, presented challenges to FNS in monitoring nutrition assistance programs during the
pandemic.
386Typically, FNS publishes new program data each month on a 3-month lag—that is, FNS published April 2020 data in
July 2020.
Page 259
GAO-21-387

In March 2021, FNS oﬃcials told us that SNAP and Pandemic EBT data quality issues stemmed
primarily from limitations with FNS’s data system that conﬂated SNAP and Pandemic EBT data.
To address this issue, FNS oﬃcials explained that the agency had to separate participation and
expenditures manually. FNS did not provide information on or explain this manual process in its
public data release, even though it was a departure from the process for developing prior reports
and introduced some potential for error.
FNS oﬃcials said they have implemented steps to verify the accuracy of the data produced
through this manual process, but we found one instance in which the agency released inaccurate
data. As a result, multiple media outlets reported this inaccurate information, which overstated
the SNAP expenditures in ﬁscal year 2020 by $10 billion. When we brought this to FNS oﬃcials’
attention, they corrected the data, but as of mid-March 2021, the ﬁles posted on FNS’s website
do not include an erratum or note to disclose to users that the data had changed or explain the
reason for the change.
In addition, FNS has not provided suﬃcient context to help stakeholders and the public
understand and interpret the agency’s data for the new Pandemic EBT program. FNS oﬃcials
told us about several important nuances that were necessary to understand the Pandemic
EBT data the agency released in January 2021, but the agency did not include any table notes
explaining those nuances publicly. For example, FNS oﬃcials said that the agency reports a child
as a participant in Pandemic EBT only in the month the child received beneﬁts, even if those
beneﬁts cover additional months retroactively. As a result, FNS’s Pandemic EBT participation
data show considerable variation month-to-month that does not fully reﬂect the total number of
eligible children who received beneﬁts covering a given month. Though this context is necessary
for stakeholders and the public to interpret participation and expenditures data for Pandemic EBT
accurately, FNS did not include it in the January 2021 data release.
In March 2021, FNS provided us with the internal communication plan oﬃcials used to inform
certain key stakeholders about the data it released in January 2021. The plan indicated that the
agency intends to return to its typical schedule of releasing key program data regularly as the
pandemic continues. The plan also outlined several of the data quality challenges described
above and the agency’s eﬀorts to address them. For example, the plan noted that FNS needed
to work with states and adjust its process to separately report SNAP and Pandemic EBT beneﬁts,
and that the unusual circumstances of the COVID-19 pandemic may continue to result in more
revisions to the data than usual. FNS oﬃcials said that they are not aware of any plans to release
this information publicly—such as on the website where FNS posts its monthly program data—so
that a broader group of stakeholders and users of FNS’s data understand the data quality issues
and the steps the agency is taking to address them.
The Oﬃce of Management and Budget (OMB) has issued guidelines to federal agencies on
ensuring and maximizing the quality, objectivity, utility, and integrity of information agencies
disseminate.387 Among other things, the guidelines direct agencies to consider the usefulness
of information to intended users, including the public. The guidelines state that agencies should
present information in an accurate, clear, complete, and unbiased manner, and within a proper
387Oﬃce of Management and Budget, Guidelines for Ensuring and Maximizing the Quality, Objectivity, Utility, and Integrity of
Information Disseminated by Federal Agencies (Washington, D.C.: Oct. 1, 2001).
Page 260
GAO-21-387

context. Further, the guidelines state that agencies should identify and disclose sources of error
that aﬀect data quality. Because FNS has not published information on its eﬀorts to address
prior data quality issues or disclosed potential sources of error, stakeholders and the public lack
suﬃcient information and appropriate context to interpret key program data and understand the
eﬀects of the pandemic on the programs.
Expenditures and participation in key federal nutrition assistance programs have increased
during the pandemic, but varied by program.
SNAP. According to recently released data from FNS, SNAP expenditures and participation have
increased during the pandemic, though expenditures have increased by a greater amount due to
temporary increases in beneﬁts for some households.388 From March through September 2020,
FNS provided approximately $51.6 billion in SNAP beneﬁts—a more than 60 percent increase
when compared to the same months in 2019. The increase in expenditures reﬂects both increases
in participation as well as increases to the amount of certain households’ beneﬁts, known as
emergency allotments.
• In terms of participation, the number of individuals receiving SNAP increased by about 15
percent from March 2020 to a high of 42.9 million participants in September 2020.
• In terms of increased beneﬁts amounts, through March 2021, nearly all states were providing
emergency allotments to certain households, which increased monthly SNAP beneﬁts to the
maximum available amount for the households’ size. In ﬁscal year 2020, FNS had estimated
that emergency allotments cost approximately $2 billion per month.
Pandemic EBT. According to recently released data from FNS, the agency issued approximately
$10.7 billion in Pandemic EBT beneﬁts from March through September 2020, and a high of nearly
13 million children received Pandemic EBT in June 2020.389 Because Pandemic EBT was a new
program during the pandemic, there are no historical data available for comparison. These data
primarily reﬂect expenditures and participation from school year 2019-20, when all 50 states and
the District of Columbia operated Pandemic EBT.
States are currently working with FNS to request and receive approval to issue Pandemic EBT
beneﬁts for school year 2020-21. As of mid-March 2021, FNS had approved 24 states and Puerto
Rico to administer Pandemic EBT for the current school year. FNS guidance allows states to issue
retroactive beneﬁts to cover the multiple months of the school year that passed prior to FNS’s
388Data presented throughout this section are FNS’s preliminary data on participation in and expenditures for its
nutrition assistance programs for ﬁscal year 2020, released on January 27, 2021. As mentioned above, FNS noted that
data are subject to signiﬁcant revision. On March 12, 2021, FNS released additional data covering the ﬁrst two months
of ﬁscal year 2021 (October and November 2020). Those data show that, in November 2020, 41.4 million individuals
participated in SNAP and monthly beneﬁts totaled approximately $7.8 billion.
389As noted above, according to FNS oﬃcials, the agency reports a child as a participant in Pandemic EBT only in the
month the child received beneﬁts, even if those beneﬁts cover additional months retroactively. For example, a child that
received Pandemic EBT beneﬁts in June 2020 to cover the months of March, April, May, and June 2020 is only reported as
a participant for June 2020. FNS oﬃcials said this is consistent with how the agency reports participation and beneﬁts for
SNAP.
Page 261
GAO-21-387

approval of the states’ plans.390 Consequently, as FNS approves more states, and schools continue
to operate online or hybrid models for the current school year, Pandemic EBT disbursements are
likely to increase signiﬁcantly in the ﬁrst few months of calendar year 2021.391 To the extent that
states have not yet issued beneﬁts for school year 2020-21 or issued beneﬁts retroactively, eligible
children would not have had access to Pandemic EBT beneﬁts to meet their needs earlier in the
school year.
WIC. In contrast to SNAP, total food costs for WIC have decreased during the pandemic, according
to the most recent FNS data available. Speciﬁcally, from March through September 2020, WIC food
costs totaled $1.6 billion—a 12 percent decrease when compared to the same months in 2019.
In addition, FNS has allocated all $500 million provided for WIC in FFCRA.392 According to FNS, in
December 2020 the agency allocated approximately $330 million for WIC food funds and $170
million for Nutrition Services and Administration funds to state agencies.393
Though food costs have decreased, WIC participation increased slightly during the pandemic.
Speciﬁcally, the number of individuals receiving WIC increased by nearly 2 percent between March
and September 2020. About 6.3 million women, infants, and children accessed WIC in September
2020, according to FNS data. The increase in WIC participation was driven entirely by a greater
number of children participating in the program; the number of women and infants participating
decreased during this period, according to FNS data. FNS oﬃcials told us there are several reasons
why WIC food costs decreased at the same time participation increased. For example, they noted
that the children’s WIC food package is less costly than the infant food package and the pregnant
and breastfeeding women’s food packages. They also noted that, among other factors, WIC food
costs ﬂuctuate and that costs were highest in March compared to subsequent months in ﬁscal
year 2020.
TEFAP. Expenditures for TEFAP also increased during the pandemic, according to the most recent
FNS data available. From March through September 2020, FNS provided about $353 million in
TEFAP foods to emergency food providers, a 12 percent increase compared to the same months
in 2019. As previously reported, FNS does not collect national data on the number of individuals
or households that participate in TEFAP, but representatives from organizations whose members
administer TEFAP told us that demand at food banks has increased signiﬁcantly during the
pandemic.
390States not previously approved to issue beneﬁts for the beginning of school year 2020-21 may include those months
(generally August and September 2020) in their plans.
391The Continuing Appropriations Act, 2021 and Other Extensions Act also expanded Pandemic EBT to include
certain children in childcare. Pub. L. No. 116-159, § 4601(6), 134 Stat. 709, 744. In December 2020, the Consolidated
Appropriations Act, 2021 changed eligibility, and on January 29, 2021, FNS issued guidance to states on implementing
this provision. Pandemic EBT disbursements are likely to increase signiﬁcantly once states are able to issue beneﬁts to
certain children in childcare.
392As we reported in November 2020, FNS had not needed to disburse any of these funds for WIC in ﬁscal year 2020.
393FNS provides WIC state agencies with a food grant and the Nutrition Services and Administration grant. WIC state
agencies can use the food grant to provide supplemental foods, such as WIC-approved eggs, milk, and infant formula.
State agencies can use the Nutrition Services and Administration grant for administrative costs and certain WIC public
health initiatives, including nutrition education and breastfeeding support services.
Page 262
GAO-21-387

Legislative changes have helped states administer SNAP and Pandemic EBT during the
pandemic, while potentially presenting new operational challenges in ﬁscal year 2021.
In November 2020, we highlighted several challenges implementing SNAP, including
FNS’s approach to reviewing states’ requests for various SNAP adjustments. For example,
representatives we interviewed from several national research and advocacy organizations noted
that FNS’s month-to-month approach to reviewing and extending several SNAP adjustments
caused uncertainty for states and made implementing the program diﬃcult.
Provisions in the Continuing Appropriations Act, 2021 and Other Extensions Act, enacted in
October 2020, have helped to address many of the challenges states faced working with FNS
to implement SNAP earlier in the pandemic. The act granted states broader authority to adjust
some SNAP operations into ﬁscal year 2021 without obtaining prior approval from FNS.394
According to FNS data as of mid-March 2021, 36 states, the District of Columbia, and the U.S.
Virgin Islands had used at least one adjustment to their certiﬁcation processes (e.g., to determine
participants’ eligibility and beneﬁt levels for SNAP). For example, the majority of these states
waived interviews for individuals or households applying for SNAP beneﬁts and for SNAP
households due for recertiﬁcation. According to representatives from the American Public Human
Services Association, the broader authority for adjusting SNAP operations granted in the act
has allowed states to expeditiously modify their SNAP operations and better respond to the
pandemic’s eﬀects on the program, such as increased caseloads. For other SNAP adjustments,
such as providing emergency allotments, states still must request approval from FNS each month.
More recently, the Consolidated Appropriations Act, 2021, enacted in December 2020, made
several changes to SNAP operations, including temporary changes to SNAP beneﬁts levels and
eligibility requirements. For example, as previously noted, the act increased SNAP beneﬁts for
all participants by 15 percent through the end of June 2021, according to FNS.395 Among other
provisions, the act also temporarily extended SNAP eligibility to qualifying low-income college
students and excluded federal pandemic unemployment compensation as income and resources
for determining SNAP eligibility and beneﬁts amounts for 9 months following the month of
receipt.396 Such provisions may help vulnerable populations that otherwise would have been
ineligible to access SNAP beneﬁts during the pandemic.
394Pub. L. No. 116-159, § 4603(a)(1), 134 Stat. 709, 745-746.
395According to USDA, the agency is reviewing its authority to permit states to provide additional SNAP beneﬁts through
emergency allotments for households already receiving the maximum beneﬁt for their household size. USDA also noted
that it will expedite its implementation of the provision of the Agriculture Improvement Act of 2018 requiring USDA to
reevaluate the Thrifty Food Plan by 2022 and every 5 years thereafter. See Pub. L. No. 115-334, § 4002, 132 Stat. 4490,
4624. The Thrifty Food Plan is the basis for determining SNAP beneﬁts amounts, and USDA’s review will determine if the
plan adequately reﬂects the present costs of a nutritious diet.
396Pub. L. No. 116-260, div. N, tit. VII, § 702(d) and (e), 134 Stat. 1182, 2093. In June 2020, we reported that FNS denied
requests from 31 states to suspend the requirement that college students work at least 20 hours per week or participate
in federal work study to be eligible for SNAP. FNS oﬃcials explained at the time that they did not have authority to
suspend the requirement in the FFCRA. Additionally, we recommended in December 2018 that FNS improve SNAP
eligibility information for college students on its website and share information on how states may help eligible college
students access SNAP.
Page 263
GAO-21-387

These temporary changes to SNAP operations might also raise new challenges for FNS and
for states as they administer the program during the pandemic. For example, states may have
beneﬁted from receiving more complete guidance from FNS on how to implement provisions
related to college student eligibility. The act required states to implement these provisions by
January 16, 2021. FNS issued initial guidance on December 31, 2020 and more detailed guidance
on February 2, 2021 after consulting with the Department of Education. As a result of the delay
in receiving detailed guidance, states may have delayed implementation or began to implement
these provisions without complete guidance. In addition to written guidance, FNS said the agency
is in regular communication with states to provide targeted technical assistance as needed on
these temporary changes to SNAP. Furthermore, FNS and states may need to consider strategies
for helping SNAP recipients understand and prepare for when these temporary adjustments to
beneﬁts levels and eligibility requirements expire.
As previously noted, recent legislative and executive actions also made changes to Pandemic
EBT—including increasing beneﬁts and changing eligible populations—and in some cases, the
timing of FNS’s guidance has caused program delays. For example, for school year 2020-21, FNS
provided guidance to states on November 16, 2020, that included information on the standards
the agency would use to review and approve states’ Pandemic EBT plans. Consequently, states did
not begin submitting plans for FNS approval until several months into the school year. FNS oﬃcials
said they have been working closely with states to develop and operationalize Pandemic EBT plans
for school year 2020-21, and anticipate approving several more states’ plans soon. In addition, on
January 29, 2021, FNS provided guidance to states on extending Pandemic EBT to children under
age 6 in eligible childcare settings. States may now move forward with submitting plans to FNS to
implement this provision.
FNS has extended WIC waivers for the duration of the public health emergency, but access
challenges remain.
In November 2020, we highlighted how FNS generally provided states with multiple-month waivers
for WIC operations during the pandemic, and extended certain waivers until 30 days after the
COVID-19 public health emergency ends. For example, the agency has approved all states to
allow individuals to apply for WIC without being physically present in a WIC oﬃce and allowed
nearly all states to issue beneﬁts remotely, among others. Representatives from the National
WIC Association said that extending waivers through the end of the pandemic has helped states
address the uncertainty related to WIC operations.
WIC participants are currently unable to use their beneﬁts online, but recent legislative action
may help expedite FNS’s response in this area. To help develop a plan for WIC online purchasing,
FNS announced in November 2020 that it awarded a $2.5 million, 3-year competitive grant to
develop and test a safe and secure model for online purchasing. In addition, the Consolidated
Appropriations Act, 2021, enacted in December 2020, requires USDA to establish a task force
that will, among other things, study online purchasing options for WIC. The task force must
make recommendations to USDA no later than September 30, 2021. Representatives from the
National WIC Association said this provision will help FNS oﬀer online purchasing, which could
improve overall participation in WIC and help address the current unequal shopping experience
Page 264
GAO-21-387

for WIC participants, relative to SNAP participants.397 FNS oﬃcials said the work of the task force
will complement its ongoing eﬀort to develop a plan for WIC online purchasing. FNS oﬃcials
also said they must establish the task force by March 27, 2021, and may not be able to invite all
interested parties to be members given the short time frames and criteria regarding the number
and composition of the task force members.
As noted above, FNS recently provided $170 million from FFCRA to state WIC agencies to help
cover increased administrative costs incurred during the pandemic, such as to purchase personal
protective equipment for staﬀ who cannot work remotely. Representatives from the National
WIC Association also said that states’ WIC program administration costs have increased to
accommodate operational changes related to the pandemic, including technology costs related to
issuing beneﬁts electronically so participants do not have to visit a WIC agency in person to obtain
their beneﬁts.
Canceled orders remain a major challenge for states in administering TEFAP during the
pandemic.
Canceled TEFAP food orders during the pandemic continue to aﬀect states’ ability to supply local
food banks and use funds appropriated for the program. According to representatives from
the American Commodities Distribution Association and Feeding America—whose members
distribute food to food banks for TEFAP and other FNS programs—TEFAP cancelations have led
to shortages of certain products in food banks nationwide at a time of increased demand, and
made it diﬃcult for states to spend TEFAP funds provided through COVID-19 relief laws. As we
reported in November 2020, FNS oﬃcials and representatives from organizations we interviewed
said that FNS had to cancel orders for several reasons, including that no vendors bid on a given
order, the food was unavailable due to supply chain issues, and increased costs for transportation
and raw materials. According to FNS data, the magnitude of canceled TEFAP orders in terms of
both the estimated value of the food and total truckloads was greater from October to December
2020 when compared to March to September 2020. To help states address the impact of canceled
TEFAP orders in ﬁscal year 2021, FNS said it was in the process of developing new procurement
methods and oﬀering new product options.
Agency Comments
We provided a draft of this enclosure to FNS and OMB for review and comment. FNS generally
concurred with our recommendation. FNS and OMB provided technical comments, which we
incorporated as appropriate.
397Households receiving SNAP beneﬁts in most states had the option to use their beneﬁts online during the COVID-19
pandemic. The SNAP Online Purchasing Pilot began in April 2019 in New York, followed by Washington in January 2020.
As of mid-March 2021, FNS has approved 47 states, including the District of Columbia, to participate. In addition, the
Consolidated Appropriations Act, 2021 includes $5 million for SNAP online purchasing technical assistance and related
technology improvements, among other things.
Page 265
GAO-21-387

Methodology
To conduct our work, we reviewed FNS data on program participation as of September 30, 2020
(released in January 2021), and expenditures as of January 31, 2021, the most recent data available
at the time of our analysis. We determined these data were suﬃciently reliable for our purposes
by reviewing program documentation, discussing the data with knowledgeable FNS oﬃcials, and
conducting manual testing for outliers or other errors. We also reviewed relevant federal laws,
agency guidance and documents, and FNS’s written responses to our questions. Additionally, we
interviewed oﬃcials from several national organizations, including the American Commodities
Distribution Association, the American Public Human Services Association, Feeding America, and
the National WIC Association.
Contact information: Kathryn A. Larin, (202) 512-7215, larink@gao.gov
Related GAO Product
Food Insecurity: Better Information Could Help Eligible College Students Access Federal Food Assistance
Beneﬁts. GAO-19-95. Washington, D.C.: December 21, 2018.
Page 266
GAO-21-387

Child Nutrition
The Department of Agriculture has extended key ﬂexibilities for school, summer, and child care
programs through the summer of 2021, but meal programs are generally serving fewer meals to
children than they did pre-pandemic and many school district nutrition programs report ongoing
ﬁnancial challenges.
Entity involved: Food and Nutrition Service, within the Department of Agriculture
Key Considerations and Future GAO Work
In September 2020, we reported on the number of meals served to children early in the COVID-19
pandemic and potential challenges for school districts and other meal providers in the 2020-21
school year. We continue to monitor data on the number of meals served, the Food and Nutrition
Service’s use of COVID-19 relief funding and its eﬀorts to provide ﬂexibilities to states and school
districts to support child nutrition, and plan to review its monitoring and oversight of child
nutrition programs in our future work.
Background
Child nutrition programs administered by the Department of Agriculture’s (USDA) Food and
Nutrition Service (FNS) provide cash reimbursements for meals and snacks for eligible children
in schools, or at other locations when schools are closed. In ﬁscal year 2019, the National School
Lunch Program (NSLP), School Breakfast Program (SBP), Summer Food Service Program (SFSP),
Child and Adult Care Food Program (CACFP), and other child nutrition programs received $23.1
billion in federal funds.398 In general, the largest subsidies are provided for free or reduced-price
meals and snacks served to children from low-income households.
As we reported in June and September 2020, FNS granted various nationwide waivers in response
to the pandemic to facilitate meal provision while limiting potential COVID-19 exposure. For
example, one waiver allows meals to be served in non-congregate settings. Starting in the spring
of 2020, schools and other meal providers were able to operate under the Summer Food Service
Program (SFSP) and the Seamless Summer Option (SSO).399 These summer meal programs
typically operate from May through September for children on school vacation but may also
operate during unanticipated school closures. FNS also waived the requirement that summer meal
sites providing free meals to all children must be located in areas in which at least half the children
are from low-income households. This waiver expanded the population of children eligible for free
meals, and eased the administrative burden of tracking and collecting payment for school meals
while maintaining social distancing guidelines.
398This review includes NSLP, SBP, SFSP, and CACFP. The Special Supplemental Nutrition Program for Women, Infants,
and Children (WIC) program is not included in this review.
399The Seamless Summer Option is a program that allows school districts to operate a modiﬁed version of the National
School Lunch Program and School Breakfast Program into the summer, or during unanticipated school closures. The
program is reimbursed at the same rate as the National School Lunch Program. In contrast, the Summer Food Service
Program has a higher reimbursement rate.
Page 267
GAO-21-387

Various COVID-19 relief laws have provided funding or authority to USDA to support child nutrition
programs during the pandemic. For example:
• The CARES Act provided $8.8 billion in supplemental funds.400 As of January 31, 2021, FNS
had obligated most of these funds ($7 billion) to reimburse schools for the cost of meals,
and disbursed $6.4 billion to states and other meal providers. Meal reimbursement costs
include the provision of free meals to more children, under waivers described below, as well
as weekend meal service, according to FNS. A small portion of this funding, $185 million, was
used to operate Emergency Meals-to-You, a new partnership that delivered meals to address
pandemic-related nutrition needs in rural areas throughout the spring and summer of 2020.401
• The Families First Coronavirus Response Act granted FNS authority to issue nationwide
waivers in certain programs for speciﬁc purposes, and the Continuing Appropriations Act, 2021
and Other Extensions Act, enacted in October 2020, extended this authority.402
• The Consolidated Appropriations Act, 2021, enacted in December 2020, provided additional
funding to support CACFP child care providers and school nutrition programs by replacing
some of the decline in reimbursement funding in the spring of 2020.403
Overview of Key Issues
Key child nutrition waivers are in place through the summer of 2021, but uncertainty
remains for the 2021-22 school year. After multiple shorter-term extensions, on October 9,
2020, FNS extended several key waivers for child nutrition programs, in particular, those for
the summer meal programs, ensuring ﬂexibilities in meal provision through the 2020-21 school
year.404 School district oﬃcials and stakeholders commented that these waiver extensions have
allowed them to plan for the remainder of the school year and provide meals while operating
under diﬀerent learning models (hybrid, in-person, remote). On March 9, 2021, FNS announced a
further extension of these waivers through the summer to allow all children to continue to receive
meals while schools are out of session and to help programs plan for the summer. These waivers
are now in place through September 30, 2021.
Prior to the October extension, these waivers were extended for the summer meal programs
on August 31, 2020 through the end of calendar year 2020 or until available funding ran out.
400Pub. L. No. 116-136, div. B, tit. I, 134 Stat. 281, 507.
401Emergency Meals-to-You was a public-private partnership between USDA, the Baylor University Collaborative on
Hunger and Poverty, McLane Global, and PepsiCo. It began as a summer pilot project in 2019, but was expanded in
response to the COVID-19 pandemic.
402Pub. L. No. 116-159, § 4602(a), 134 Stat. 709, 745; Pub. L. No. 116-127, § 2202(a), 134 Stat. 178, 185 (2020).
403Pub. L. No. 116-260, div. N, tit. VII, § 722, 134 Stat. 1182, 2097. This law provided an indeﬁnite appropriation of
funds based on a formula that generally takes into account the diﬀerence in reimbursements paid between March-
June of 2019 and March-June of 2020.
404This action was taken following the Continuing Appropriations Act, 2021 and Other Extensions Act enacted on
October 1, 2020, that extended USDA’s waiver authority under the Families First Coronavirus Response Act and provided
an indeﬁnite appropriation to carry out the extension.
Page 268
GAO-21-387

According to our interviews with district nutrition oﬃcials, these waiver extensions were welcomed
because their districts had been operating under summer meal programs, which are generally
more ﬂexible than NSLP, since the start of the pandemic. However, the late date of the extensions
caused challenges, particularly for districts whose school year started prior to August 31.
Speciﬁcally, many school district nutrition oﬃcials we interviewed reported switching from a
summer meal program to NSLP prior to the waiver extensions, or taking actions anticipating that
they would be required to operate under NSLP. Some districts reported declines in participation as
a result of switching from one program to the other.
District nutrition oﬃcials said that they are facing numerous challenges planning for the upcoming
2021-22 school year, and some said that extending the waiver ﬂexibilities into the upcoming
school year would assist with planning. Some oﬃcials noted that it would be beneﬁcial to
know if FNS plans to extend waivers before early spring of 2021, as that is when districts begin
planning, including budgeting, menu planning, and ordering food, for the fall. We asked FNS about
waiver extensions, and in March 2021, FNS stated it was committed to announcing plans for the
upcoming school year as soon as possible so that district nutrition oﬃcials may begin planning
and procurement.
While the number of meals served through child nutrition programs has decreased, the
number of children participating in these programs during the pandemic is unknown and
some families may be accessing nutrition assistance through other programs. According
to the most recent available data from FNS, in March through September 2020, the NSLP, SBP,
SFSP, and CACFP programs served nearly 1.7 billion fewer total meals—a decline of over 30
percent—compared to the same months in the previous year (see ﬁgure).405 This drop in meals
served occurred even as FNS waivers expanded eligibility for free meals.
405These updated data reported by FNS show a larger drop in meals served than previously reported data for March
and April 2020. We previously reported in September 2020 that initial FNS data showed the number of meals served
dropped by almost 400 million (21 percent) in March and April 2020 compared to March and April 2019. Updated FNS
data showed more than 740 million fewer meals (39 percent) were served in March and April 2020 compared to the
same months in 2019. According to FNS, state agencies submit monthly meal claim reports to FNS. Initial monthly
tabulations reported 30 days following the end of the claim month include estimated data based on the previous year,
and the uncertainty of meal service during the COVID-19 pandemic has made it diﬃcult for states to utilize historical
data to report estimates of meals served, according to FNS. Data reported by states to FNS 90 days following the end
of the claim month are based on actual meal claims, rather than estimates. According to FNS, these data are subject to
revision.
Page 269
GAO-21-387

Total Meals Served Per Month in Key Child Nutrition Programs, March through September 2019 and 2020
Notes: The monthly totals include the four following child nutrition programs: National School Lunch Program (NSLP), School
Breakfast Program (SBP), Summer Food Service Program (SFSP), and Child and Adult Care Food Program (CACFP) (child meals
only). The NSLP and SBP numbers include meals served through the Seamless Summer Option, a program which allows school
districts operating NSLP and SBP to continue the same meal service rules and claiming procedures used during the regular
school year throughout summer and during unanticipated school closures.
According to Food and Nutrition Service, the number of meals reported for any given month is subject to marginal revisions
over time for a variety of reasons, including late claims and changes that come as a result of routine monitoring activity.
School district nutrition oﬃcials we interviewed attributed the drop in the number of meals
served during the pandemic to several factors. For instance, school closures kept children from
receiving meals in school and fear of exposure to COVID-19 kept some families from venturing out
to pick up meals. In addition, families in need may have accessed food through other assistance
programs, such as Emergency Meals-to-You or Pandemic Electronic Beneﬁt Transfer (Pandemic
EBT).406 Although there was a drop in the number of meals served, nutrition oﬃcials in multiple
states suggested that the need for meals had not decreased. They indicated that more children
would likely qualify for free and reduced price meals as a result of the economic downturn since
the pandemic began.
406During the spring and summer 2020, the Emergency Meals-to-You program mailed boxes of 10 breakfasts and 10
lunches to eligible students in participating school districts. The purpose of the program was to serve students who
were no longer able to receive meals at school due to the pandemic-related school closures, and resided in rural school
districts in which at least 50 percent of enrolled students were eligible for free or reduced-priced lunch. The Pandemic
EBT program provides beneﬁts to households with children who would have received free or reduced-priced school
meals if not for school closures due to COVID-19.
Page 270
GAO-21-387

While data from FNS provide a partial picture of the number of meals served during the pandemic,
the total number of children participating in these programs during the pandemic is unknown.
Estimates of the number of children participating in child nutrition programs are typically available
monthly for NSLP and SBP, quarterly for CACFP, and once a year in July for SFSP. According to FNS,
many school meal programs are operating under SFSP; therefore, the once a year estimates of
SFSP participation are too infrequent to assess participation during the pandemic. Further, in
May 2018, we found FNS data on SFSP participation to be an unreliable estimate of children’s
participation.407 In March 2021, FNS told us of additional steps it is taking to address this issue,
including gathering data to evaluate participation across child nutrition programs during the
pandemic. We recognize the challenges of assessing child participation across multiple child
nutrition programs during the pandemic and we will continue to examine this as part of our
ongoing work.
School nutrition programs report continued ﬁnancial challenges and FNS’s use of CARES
Act funds may not align with needs. Nutrition oﬃcials we interviewed in three of the four
state nutrition oﬃces and a majority of districts reported facing ﬁnancial challenges. They
said these challenges stemmed from a decline in revenue due to the drop in the number of
meals served—and thus the amount of federal reimbursements their nutrition programs
received—during the pandemic. For instance, one district nutrition oﬃcial reported serving about
half as many meals in the fall of 2020 compared to the prior year, causing the district nutrition
program’s fall revenue to decline by about half a million dollars. To cover monthly expenses, the
program drew from its reserves. Oﬃcials we interviewed told us that nutrition programs that
depleted their reserves and had debt would have to draw from their districts’ general funds to
cover their expenses.408 A few district nutrition oﬃcials speciﬁcally reported that these losses
were exacerbated by a decline in revenue from à la carte sales during the pandemic. Almost all the
district nutrition oﬃcials we interviewed reported that the FNS waivers were helpful in allowing
them ﬂexibilities to continue providing meals so they could receive some reimbursements, but
that the reimbursements did not oﬀset their lost revenue.
District nutrition oﬃcials we interviewed also reported increased program expenses in areas
such as labor, supplies, and storage. For example, oﬃcials described new or increased expenses
associated with obtaining personal protective equipment (PPE), providing individually wrapped
items and packaging, as well as purchasing or renting additional coolers and freezers. Oﬃcials
in half the districts reported receiving COVID-19 relief funds, private grants, or both to help with
these expenses. Most of the programs that did not receive COVID-19 relief funds were in districts
that used these funds for other K-12 priorities, according to district nutrition oﬃcials
FNS’s guidance to use the $8.8 billion CARES Act funds primarily for meal reimbursements did
not always align with the needs of nutrition programs, according to state nutrition oﬃcials we
407In our May 2018 report, we recommended FNS improve its estimate of participation by focusing on addressing data
reliability issues caused by variations in the number of operating days of meal sites and in the months in which states
see the greatest number of meals served. This recommendation remains open. FNS recently reported that it plans
to use results from an upcoming study on summer meals to gather more information on how SFSP participation is
captured.
408Per federal regulations, nutrition programs’ reserves are generally limited to no more than three months’ average
expenditures. See 7 C.F.R. § 210.14(b).
Page 271
GAO-21-387

interviewed. FNS said that using these funds for direct meal reimbursement would help ensure
that suﬃcient federal resources were available to cover costs associated with the waivers, such as
expanded eligibility and higher reimbursement rates for programs operating under SFSP. However,
oﬃcials in three of the four state nutrition oﬃces selected for our review said that because
school districts in their states served fewer meals during the pandemic—despite expanded
eligibility—their revenue from federal reimbursements was lower than in a typical year. They
indicated the funds would have had a greater eﬀect if FNS had used them to supplement existing
reimbursements, thereby enabling them to cover pandemic-related costs such as hazard or
overtime pay for staﬀ, the purchase of PPE, additional packaging, and other items.409
Oﬃcials from districts and national organizations we interviewed indicated that they were
concerned that ﬁnancial challenges would continue in the 2020-21 school year and beyond.
Funds from the Consolidated Appropriations Act, 2021, mentioned above, may be used for meals,
supplements, and certain administrative costs. FNS said that these relief funds are intended to
help defray costs incurred and decreased revenue as a result of the pandemic. An oﬃcial from
one national organization we interviewed noted these relief funds would help oﬀset some losses
from the spring of 2020 but, because there was no funding to cover pandemic losses from the
summer or fall, would not fully address ongoing ﬁnancial challenges. The act speciﬁed that these
relief funds are available for obligation until September 30, 2021 and we will continue to examine
this as part of our ongoing work.
Agency Comments
We provided a draft of this enclosure to FNS and the Oﬃce of Management and Budget (OMB) for
review and comment. They did not provide comments on this enclosure.
Methodology
To conduct our work, we reviewed the most recent data available from FNS on meals served,
which we determined were suﬃciently reliable for our purposes. To assess the reliability of these
data, we reviewed existing information about the data and reporting processes, interviewed
agency oﬃcials, and conducted manual testing of the data. We also reviewed relevant federal
laws, agency guidance and documents, and written responses from FNS to our questions.
Additionally, we interviewed state nutrition directors from four states, and within each of those
states interviewed district nutrition oﬃcials from three school districts. We further interviewed
oﬃcials from the School Nutrition Association, Urban School Food Alliance, and Association of
School Business Oﬃcials International. The information gathered from these interviews is not
intended to be representative, but provides examples of experiences of meal providers during the
COVID-19 pandemic.
Contact information: Kathryn A. Larin, (202) 512-7215, larink@gao.gov
409FNS did not explicitly designate CARES Act funds for pandemic-related expenses; instead, FNS guidance states that
funds received through meal reimbursements may be used to pay for reasonable pandemic-related expenses. In one
state, the nutrition oﬃcial did not express concern about the manner in which FNS provided CARES Act funds.
Page 272
GAO-21-387

Related GAO Product
Summer Meals: Actions Needed to Improve Participation Estimates and Address Program Challenges.
GAO-18-369. Washington, D.C.: May 31, 2018.
Page 273
GAO-21-387

Employer Tax Relief and Payroll Tax Deferrals
As of January 2021, $10.2 billion in employer tax credits had been claimed and their use by small
businesses varies by industry; the Internal Revenue Service should use employee count data to aid
in identifying potentially ineligible claims.
Entities involved: Department of Agriculture; Department of Commerce, including the U.S.
Census Bureau; Department of the Treasury, including the Internal Revenue Service; and the Oﬃce
of Management and Budget.
Recommendation for Executive Action
We are making the following two recommendations to the Internal Revenue Service:
The Commissioner of Internal Revenue should leverage employee counts from Form 941,
Employer’s Quarterly Federal Tax Return and Form 943, Employer’s Annual Federal Tax Return for
Agricultural Employees, to identify potentially ineligible COVID-19 related sick and family leave credit
claims, and address discrepancies the Internal Revenue Service deems signiﬁcant.
The Commissioner of Internal Revenue should conduct outreach to employment tax return ﬁlers
to educate and promote accurate reporting of employee counts on Form 941, Employer’s Quarterly
Federal Tax Return and Form 943, Employer’s Annual Federal Tax Return for Agricultural Employees.
The Internal Revenue Service agreed with both of our recommendations.
Key Considerations and Future GAO Work
Our analysis of Internal Revenue Service (IRS) data showed that 3,352 employers who claimed a
Families First Coronavirus Response Act (FFCRA) tax credit for providing paid leave to employees
may be ineligible for the credit based on the number of employees reported on their Form 941.
IRS could leverage these data and Form 943 data to detect potentially ineligible credit claims and
address discrepancies that IRS deems signiﬁcant. IRS could also provide outreach to employment
tax return ﬁlers to promote accurate reporting of employee counts. We will continue to monitor
the development and implementation of IRS’s compliance plans for these provisions.
The Consolidated Appropriations Act, 2021 amended and extended the eligibility criteria for the
tax credits and deferrals for employers. For example, Paycheck Protection Program (PPP) loan
recipients are newly eligible for the Employee Retention Credit. The American Rescue Plan Act of
2021—enacted March 11, 2021—extends the Employee Retention Credit and modiﬁes sick and
family leave credits.410 We will continue to monitor implementation of these provisions, including
how IRS is adapting the administration of the credits and any taxpayer compliance risks. We also
have ongoing work analyzing how the eﬀects of tax policies, such as those in the COVID-19 relief
legislation and the Tax Cuts and Jobs Act, diﬀer based on the small business owner’s sex, race, or
ethnicity.
410Pub. L. No. 117-2, §§ 5001, 9651, 135 Stat. 4, 81–85, 176–182.
Page 274
GAO-21-387

Background
FFCRA and the CARES Act provide tax credits to covered employers to mitigate the cost of paid sick
and family leave for employees aﬀected by COVID-19, as well as provide an Employee Retention
Credit for all eligible employers, among other tax relief. The Consolidated Appropriations Act,
2021, enacted in December 2020, amended and extended some aspects of these credits.
Tax credits and deferrals for employers. IRS is administering the tax credits authorized by these
laws, among other tax relief. The Joint Committee on Taxation estimates that the COVID- related
tax credit provisions in the three laws will result in about $194 billion in foregone revenue for the
federal government for ﬁscal years 2021-2030.411 The IRS’s capacity to implement new initiatives,
such as the relief laws’ tax credits, is an ongoing challenge cited in our 2021 High-Risk Report.412
The tax provisions include the following:
• Paid leave credits. Businesses and tax-exempt organizations with fewer than 500 employees, as
well as self-employed individuals, are eligible for refundable FFCRA credits.413 The credits are
equal to qualiﬁed leave wages paid to employees, plus the employer share of Medicare taxes
paid with respect to qualiﬁed wages and allocable health plan expenses, for leave taken from
April 1, 2020 through March 31, 2021.414 Credit recipients who receive PPP loans cannot count
the wages paid for by the credit as payroll costs toward loan forgiveness.415
Payroll tax credits may be claimed on the employer’s employment tax return, typically Form
941, Employer’s Quarterly Federal Tax Return. To receive immediate relief, employers may
reduce their semiweekly or monthly payroll tax deposits by the amount of their credit.416 If
an anticipated credit amount remains after reducing deposits, the employer may receive an
advance refund by ﬁling Form 7200, Advance Payment of Employer Credits Due to COVID-19.
Form 7200 must be submitted using electronic fax (e-fax).
• Employee Retention Credit. Under the CARES Act as amended by the Consolidated
Appropriations Act, 2021, eligible employers of any size—including tax-exempt entities and
411On December 21, 2020, the Joint Committee on Taxation updated estimates for forgone revenue to reﬂect changes in
the Consolidated Appropriations Act, 2021.
412 High-Risk Series: Dedicated Leadership Needed to Address Limited Progress in Most High-Risk Areas. GAO-21-119SP.
Washington, D.C.: March 02, 2021.
413Pub. L. No. 116-127, §§ 7001–7004, 134 Stat. 178, 210–219 (2020). A refundable tax credit reduces tax liability,
dollar for dollar; if the credit exceeds tax liability, a refund is due. Full-time and part-time employees are counted.
Both credits have maximum payouts. Self-employed individuals may not ﬁle for advances on their credit refunds.
414The Consolidated Appropriations Act, 2021 extended this credit to include qualiﬁed leave wages paid for periods
of leave from December 31, 2020 to March 31, 2021. Pub. L. No. 116-260, div. N, § 286(a), 134 Stat. 1182, 1989
(2020). For 2020, the credit is available to eligible employers that paid qualiﬁed leave wages as required by FFCRA.
The FFCRA requirement for paid leave expired on of December 31, 2021; thus, for 2021, the credit is available to
employers that voluntarily pay leave wages if those wages would have met the FFCRA requirements for qualiﬁed
leave wages.
41515 U.S.C. § 636(a)(36)(A)(viii)(II)(dd), (ee). PPP recipients must meet certain criteria for loan forgiveness.
416Internal Revenue Service, COVID-19-Related Tax Credits: General Information FAQs (Jan. 28, 2021), accessed online
on March 1, 2021, https://www.irs.gov/newsroom/covid-19-related-tax-credits-general-information-faqs.
Page 275
GAO-21-387

self-employed individuals with employees—can claim the refundable Employee Retention
Credit.417 The credit amount is based on qualiﬁed wages paid to employees, including
certain health care expenses. Only small employers, that average 500 or fewer full-time
employees in 2019, may request an advance for 2021. As shown in the table, the Consolidated
Appropriations Act, 2021, extended the availability of the credit to wages paid before July 1,
2021, expanded eligible wages, and made several other adjustments.
417Pub. L. No. 116-136, § 2301, 134 Stat. at 281, 347–351 (2020); Pub. L. No. 116-260, div. N, § 206, 134 Stat. at
3059–3061. Some government entities, including tribal governments, tribal entities, state or locally-run colleges,
universities, and organizations providing medical or hospital care, are also eligible for the Employee Retention
Credit.
Page 276
GAO-21-387

Selected Changes to the Employee Retention Credit in the Consolidated Appropriations Act, 2021
Coronavirus Aid, Relief, and Economic
Security (CARES) Act
Changes in the Consolidated
Appropriations Act, 2021
Eligibility period for
qualiﬁed wages paid
March 13 - December 31, 2020
Extended January 1- June 30, 2021
Eligible entities
Any employer operating a trade or
business or a tax-exempt organization,
except governments and their agencies
and instrumentalities
Expanded to include:
• public colleges or universities,
• government entities whose principal
purpose is medical or hospital care, and
• certain tax exempt federal entities a
Eligibility requirements
Employers must experience either:
• full or partial suspension of
operations due to government orders
during any quarter or
• signiﬁcant decline of more than 50
percent in gross receipts compared
with same quarter in previous
calendar yearb
Amended to require decline to 80 percent of
gross receipts for the same quarter in 2019 or
the previous calendar quarterc
Percent of wages eligible
for credit d
50 percent of qualiﬁed wages (up to
$10,000 per employee for the year),
including certain health care expenses
Increased qualiﬁed wages maximum to 70
percent (up to $10,000 per calendar quarter
per employee) for wages paid between
January 1 and June 30, 2021
Credit maximums
Maximum credit of $5,000 per employee
in 2020
Increased the credit maximum per employee
to $7,000 per employee per quarter in 2021
Small eligible employer size
(average fulltime in 2019) e
100 or fewer employees, all wages count
toward qualiﬁed wages
500 or fewer employees, all wages count
toward qualiﬁed wages
Source: GAO Analysis of the Coronavirus Aid, Relief, and Economic Security Act and the Consolidated Appropriations Act, 2021. | GAO-21-387
aAn organization described in section 501(c)(1) of the Internal Revenue Code can claim the credit.
bEmployers are no longer eligible in the ﬁrst quarter after the one in which gross receipts are more than 80 percent of the same
quarter in the previous calendar year.
cBusinesses formed in 2020 may use the same quarter in 2020 to establish eligibility.
dPub. L. No. 116-136, § 2301, 134 Stat. at 347–351. For employers with more than 100 full-time employees in 2019, the credit is
calculated on wages paid to employees for time they are not providing services. For smaller employers, all wages are countable.
eSmall eligible employers may treat wages paid to employees for providing services and wages paid to employees for not
providing services as qualiﬁed wages. Large eligible employers may only treat wages that are paid to employees who are not
providing services as qualiﬁed wages.
Page 277
GAO-21-387

Under the CARES Act as originally enacted, PPP recipients were not eligible for the Employee
Retention Credit, except for certain employers that repaid their PPP loans by May 18, 2020.418 The
Consolidated Appropriations Act, 2021 amended the CARES Act to allow PPP loan recipients to
claim the Employee Retention Credit for qualiﬁed wages, although qualiﬁed wages for which the
credit is claimed cannot be used to support forgiveness of the PPP loan.419
Employers who include any qualiﬁed wages in the amount reported to the Small Business
Administration as payroll costs when applying for PPP loan forgiveness are deemed to have
elected to not take those qualiﬁed wages into account for purposes of the credit.420 PPP recipients
can claim the credit for prior 2020 calendar quarters by ﬁling an adjusted employment tax return.
There is also a special rule—the “fourth-quarter rule”—for employment tax returns for the fourth
quarter of 2020 for claiming credits for the second or third quarter of 2020 for an employer whose
PPP loan forgiveness application was denied.421
Qualiﬁed leave wages for which FFCRA credits are allowed are not included in qualiﬁed wages
for which an employer may claim the Employee Retention Credit.422 Employers can claim the
Employee Retention Credit on their employment tax returns. Employers may ﬁle Form 7200 for
advance refunds, but should ﬁrst should reduce payroll tax deposits by the credit amounts.423
• Deferred payroll tax payments for employer share of Social Security. The CARES Act granted all
employers the option to defer deposits and payments of the employer share of Social Security
tax that they would otherwise be required to make during the period beginning March 27
through December 31, 2020, and payments of the tax imposed on wages paid during that
period.424 Self-employed individuals could defer half of their Social Security taxes imposed on
net earnings from self-employment during the period beginning March 27 through December
418Pub. L. No. 116-136, § 2301(j), 134 Stat. at 350; See also 85 Fed. Reg. 23450 (Apr. 28, 2020); 85 Fed. Reg. 29845 (May
19, 2020); 85 Fed. Reg. 31357 (May 26, 2020).
419Pub. L. No. 116-260, div. N, § 206(c)(2)(B)(i), 134 Stat. at 3061. This change was retroactive to March 27, 2020, the date
of the enactment of the CARES Act
420IRS Notice 2021-20, 2021-11 I.R.B. 922 (Mar. 15, 2021), available online at: https://www.irs.gov/pub/irs-irbs/
irb21-11.pdf (accessed Mar. 15, 2021). Eligible employers may elect not to take into account certain qualiﬁed wages for
purposes of the credit. Pub. L. No. 116-260, div. N, § 206(c)(2)(A), 134 Stat. at 3060–3061.
421Pub. L. No. 116-260, § 206(e)(2), 134 Stat. at 3061. This rule can also apply to claiming the credit for health care
expenses paid.
422There are other wages for which an employer may not claim the Employee Retention Credit. For example, for
2020, employees counted under a Work Opportunity Tax Credit (WOTC) are not counted for purposes of the Employee
Retention Credit, and for 2021, the Employee Retention Credit cannot be claimed for wages for which the WOTC is
claimed.
423Only employers with an average of 500 or fewer full-time employees in 2019 may receive advance payments of the
Employee Retention Credit and the amount of any such advance is limited. Pub. L. No. 116-260, § 207(g), 134 Stat. at
3063–3064.
424Pub. L. No. 116-136, § 2302, 134 Stat. at 351–352, as amended by the Paycheck Protection Program Flexibility
Act, Pub. L. No. 116-142, § 4, 134 Stat. 641, 643 (2020). To be considered timely, deferred payments of 50 percent
of tax are to be made by December 31, 2021, with the remainder due December 31, 2022. The employer share of
Social Security tax is 6.2 percent of taxable earnings up to the Social Security wage base cap on taxable income. The
tax ﬁnances the Social Security trust funds.
Page 278
GAO-21-387

31, 2020.425 Deferred deposits and payments are to be reported on their employment tax
returns, typically on Form 941, Employer’s Quarterly Federal Tax Return. 426
Employee payroll tax deferrals . On August 8, 2020, the President signed a Presidential
Memorandum that, in part, directed the Secretary of the Treasury to exercise authority under
section 7508A of the Internal Revenue Code.427 In response, IRS issued Notice 2020-65, which
allowed for deferral of the withholding, deposit, and payment of the employee share of certain
employment taxes imposed on wages or compensation paid from September 1, 2020, through
December 31, 2020, if an employee’s wages or compensation are below a certain amount in a
pay period.428 If an employee’s employment taxes are deferred, that employee’s take-home pay
is increased by the amount of the deferred taxes, but under law, the amount deferred must be
repaid. The Presidential Memorandum directed the Secretary of the Treasury to make this deferral
available to an employer for employees whose earnings during any biweekly pay period generally
are less than $4,000 on a pre-tax basis, or the equivalent amount with respect to other pay cycles.
The Oﬃce of Management and Budget directed executive branch agencies to defer the applicable
payroll taxes for all employees who earn less than the $4,000 biweekly threshold and to inform
and educate employees on the deferral’s anticipated impact on their paychecks in the coming
months.429
Employers could defer the withholding and payment of the employee share of Social Security
payroll taxes or the railroad retirement tax equivalent on applicable wages or compensation paid
to employees for the period covered in the Presidential Memorandum. Under the Consolidated
Appropriations Act, 2021, and Notice 2021-11, repayments may be collected until December 31,
2021.430 During this period, employees’ payroll taxes are withheld from their pay as they normally
425Self-employed individuals pay the employer and employee tax share, which is 12.4 percent of taxable earnings,
up to the Social Security wage base cap on taxable income.
426Deferred payments for self-employment taxes are reported on Form 1040, Schedule SE and deferred payments
for household employment taxes are reported on Form 1040, Schedule H.
427 U.S. Presidential Memorandum, Memorandum on Deferring Payroll Tax Obligations in Light of the Ongoing COVID-19
Disaster (Aug. 8, 2020), accessed online March 15, 2021, https://trumpwhitehouse.archives.gov/presidential-actions/
memorandum-deferring-payroll-tax-obligations-light-ongoing-covid-19-disaster/. The memorandum also directs the
Secretary to “explore avenues, including legislation, to eliminate the obligation to pay the taxes deferred pursuant to the
implementation of this memorandum.”
428IRS Notice 2020-65, 2020-38 I.R.B. 567 (Sept. 14, 2020), available online at: https://www.irs.gov/irb/2020-38_IRB
(accessed Oct. 20, 2020). We were asked to issue a legal decision regarding whether Notice 2020-65 is a rule under the
Congressional Review Act. We determined that since IRS submitted Notice 2020-65 to us under the Congressional Review
Act, there is no need for a legal decision from our oﬃce. See GAO, Request for a Congressional Review Act Opinion on IRS
Notice 2020-65, B-332517 (Washington D.C.: September 2020). As noted in our correspondence, on September 4, 2020,
Representative John Larson of Connecticut introduced House Joint Resolution 94 which is a resolution of disapproval of
the Notice. H. R. J. Res. 94, 116th Cong. (2020).
429Oﬃce of Management and Budget, Guidance on Implementing Payroll Tax Deferral for Federal Employees (Sept. 11,
2020), accessed online March 1, 2021, https://www.whitehouse.gov/wp-content/uploads/2020/09/M-20-35.pdf. The
memorandum does not cover legislative and judicial branch entities.
430 Pub. L. No. 116-260, div. N, § 274, 134 Stat. at 1978 (2020); IRS Notice 2021-11, 2021-6 I.R.B 827 (Feb. 8, 2021). The
guidance directs employers to ratably withhold and pay the deferred taxes, meaning, in general, equally apportioned
across the period.
Page 279
GAO-21-387

would be and are also subject to withholding to recoup the previously deferred taxes. This results
in a reduction in take-home pay as compared to what would have occurred without the deferral.
Employers are to report deferred taxes.
Overview of Key Issues
IRS implementation of changes to the tax credits. On January 28, 2021, IRS released updated
frequently asked questions for the leave credits to include the extended availability of the credits.
On January 26, 2021, IRS issued a news release to summarize legislative changes made to the
Employee Retention Credit for 2021 by the Consolidated Appropriations Act, 2021—including
changes that limit the use of Form 7200 for claiming advance refunds to small employers.431 To
claim the Employee Retention Credit for 2020, PPP recipients may claim the credit retroactively
on an adjusted return for the calendar quarter(s) involved.432 IRS oﬃcials said they are unsure
how much eﬀect the anticipated adjusted employment tax returns—which can only be ﬁled on
paper—could have on IRS’s mail backlog.
Notice 2021-20, issued in March 2021, addresses qualiﬁed wages for the Employee Retention
Credit paid after March 12, 2020 and through the end of the year. Guidance applicable to 2021
for the credit is being developed, according to the notice. The notice summarizes the statutory
provisions governing the credit and provides an overview of the options for employers to defer
payment of employment taxes. The notice also addresses the interaction of the credit with PPP
loans and incorporates information provided in frequently asked questions posted after the
enactment of the CARES Act on the Employer Retention Credit, updated to reﬂect changes made
by the Consolidated Appropriations Act, 2021.
Given legislative changes, IRS is revising plans and considering how to use PPP loan data
for Employee Retention Credit compliance purposes. Speciﬁcally, IRS oﬃcials said they are
communicating with the Small Business Administration to leverage the existing Memorandum of
Understanding to request loan forgiveness data to help identify employers improperly claiming
the credit.
IRS processing of tax credits and Social Security payroll tax deferrals. At the time of our
analysis, for second and third quarter 2020, IRS had received employer tax return ﬁlings claiming
about $2.7 billion in FFCRA leave tax credits and about $7.5 billion in Employee Retention Credits,
according to our analysis (see table).433 Of the 8.9 million second and third quarter employment
tax return ﬁlings received, less than 1 percent of employers ﬁled to claim the Employee Retention
Credit.
431Small employers are deﬁned as those with an average of 500 or fewer full-time employees in 2019.
432On Jan. 22, 2021, IRS also released guidance implementing the legislation allowing PPP recipients who have had their
request for loan forgiveness denied have the option to claim the credit with respect to second or third quarter qualiﬁed
wages on their fourth quarter Form 941, acknowledging that this may be diﬃcult before returns are due.
433The tax credit dollar ﬁgures we are reporting are as reported by taxpayers and are subject to taxpayer reporting
error. These ﬁgures may diﬀer from IRS’s reported ﬁgures because we are reporting what was ﬁled without adjustments.
These ﬁgures represent paper returns, as of January 6, 2021 (main Form 941) and March 4, 2021 (Schedule R) and e-ﬁle
returns, as of January 12, 2021.
Page 280
GAO-21-387

Number and Amount of Families First Coronavirus Response Act Paid Leave Credits and Employee Retention
Credits Claimed in Employers’ Tax Filings
Provision
Number of employers claiming
Dollars claimed a
($ billions)
Families First Coronavirus Response Act
leave credits
382,727
2.7
Employee Retention Credit
79,330
7.5
Source: GAO analysis of Internal Revenue Service data. | GAO-21-387
Notes: The table includes second and third quarter electronically ﬁled (e-ﬁle) returns and about 2.3 million paper ﬁlings. Paper
return data are as of January 6, 2021 (main Form 941) and March 4, 2021 (Schedule R), and e-ﬁle data are as of January 12,
2021. The second quarter returns include amounts for the Employee Retention Credit from the end of the ﬁrst quarter because
legislation passed too late in the quarter to be reported then. Dollars claimed on Form 941 as credits include amounts also
claimed as advance payments requested on Form 7200. These data do not include annual returns, and IRS continues to process
a paper return backlog, which makes the data in the table above incomplete, particularly for small employers.
aThe tax credit dollar ﬁgures we are reporting are as reported by taxpayers and are subject to taxpayer reporting error. These
ﬁgures may diﬀer from IRS’s reported ﬁgures because we are reporting what was ﬁled on second and third quarter Form 941s
without adjustments.
Of employers for whom the IRS collects data on closures, 436 employers claiming one of the tax
credits or deferring payroll taxes (for either the employer or the employee share) reported their
business would be closing or stopping payment of wages in the second or third quarter.434 These
employers claimed about $2.1 million in tax credits through the paid leave credits and Employee
Retention Credits and deferred $3.3 million in employer or employee share of Social Security
payroll tax payments. IRS oﬃcials said they have existing rules and procedures—such as through
bankruptcy proceedings—to collect taxes from closed businesses.
IRS also continues to process Forms 7200 for tax credit advance refunds. As of February 25,
2021, IRS had issued $640.4 million in advance payments.435 Of the $10.2 billion in claims for the
Employee Retention Credit and leave credits on the second and third quarter Forms 941, we found
about 6 percent were ﬁled as advance refunds through a Form 7200 ﬁling.436
IRS designated more than half (24,280 of 42,539 submissions) of Form 7200 claims it received as
of February 25, 2021 as “rejected.”437 According to IRS oﬃcials, the most common reasons for
rejecting a Form 7200 claim were that the ﬁler provided an unauthorized signature or ﬁled a Form
7200 after submitting a Form 941 for the quarter or after the due date of the Form 941 for the
434This number is likely an undercount because it does not include employers who either ﬁle on paper returns (IRS does
not capture this line), or who do not provide this information because it is not on Schedule R, Allocation Schedule for
Aggregate Form 941 Filers. According to IRS oﬃcials, this may also include employers who have switched to a third-party
ﬁler or, in certain circumstances, who have been acquired, merged, or consolidated.
435Some of these advances are also included in the table above because employers are to report on Form 941 the
advance credits they have received.
436This calculation is based on the amount of advance credits received reported by taxpayers on Form 941, which diﬀers
from the amount of advance credits IRS has issued.
437Multiple Forms 7200s may be included in each e-fax receipt, including duplicate submissions and aggregate
submissions from the same employer.
Page 281
GAO-21-387

quarter. IRS said as of February 25, 2021, it had mailed 21,764 letters to employers whose Form
7200 claims were rejected.
IRS oﬃcials said that, as of February 2021, it was taking approximately seven weeks to process
Forms 7200, including four weeks to assign the forms to reviewers. A large inﬂux of Forms
7200—more than 7,600—were received in January 2021, a 233 percent increase compared
to December 2020. This increase was due to requests for advance payment of the Employee
Retention Credit for PPP recipients, according to IRS oﬃcials.
IRS continues to process a paper return backlog, which makes the data in the table above
incomplete, particularly for small employers. IRS oﬃcials said as of December 18, 2020 that they
were caught up opening mail. However, as of March 2021, IRS oﬃcials said weather-related issues
and the arrival of end of year returns caused another mail backlog. Additionally, oﬃcials said it is
taking longer to process because IRS facilities that process paper Forms 941 continue to operate
at reduced capacity to accommodate social distancing. In addition, annual employment tax return
forms—generally due January 31, 2021—once processed, will include tax credit and deferral
information for certain small employers and agricultural employers.
On February 8, 2021, the IRS announced the release of a new form for tax year 2020 for eligible
self-employed individuals to determine their sick and family leave credits under the FFCRA.
Calculations from the new Form 7202, Credits for Sick Leave and Family Leave for Certain Self-
Employed Individuals, are included on the individual’s income tax return.
In our analysis of second and third quarter returns, we found a total of 256,321 employers
deferred about $67 billion in Social Security taxes for the employer and employee share
together.438 Among the executive branch agencies for which the National Finance Center (NFC)
provides payroll services, 369,000 eligible employees, or over half of all employees that NFC
provides payroll services to, had the employee portion of their Social Security tax deferred during
the deferral period.439 According to IRS oﬃcials, employers are ultimately responsible for repaying
the deferred taxes and the agency has no direct role in guiding employers on how to explain the
deferral and repayment requirements. For employees that separated from their positions before
or during the repayment period, NFC is implementing a process to collect deferred taxes, which
includes established debt collection procedures.
IRS could leverage employee count data to identify potentially ineligible leave credit claims.
Our analysis of IRS data showed that some employers who claimed a FFCRA leave tax credit may
be ineligible for the credit based on the number of employees reported on their Form 941. We
identiﬁed 3,352 employers who claimed a leave credit and reported—on their second or third
quarter Form 941—500 or more employees.440 Of these employers, 1,946 reported more than
438We could not separate employee and employer share of the deferrals because, according to IRS oﬃcials, data on the
new Form 941 line with employee share of deferrals will not be available in their database until late March 2021.
439 The Department of Agriculture’s National Finance Center provides payroll services for more than 600,000 federal
employees.
440IRS oﬃcials said they have noted many employers who entered the same value for their employee count and their
wages, tips and other compensation (line 2) on their Form 941. Our counts of potentially ineligible leave credit claimants
include 643 employers who made this error. To ensure our employee counts were not inﬂated by aggregate reporting,
Page 282
GAO-21-387

700 employees, suggesting that ﬂuctuations of employees within the quarter may not explain
the apparent ineligibility. Further, 1,083 employers reported 10,000 or more employees, claiming
a total of about $40.5 million of leave credits. Employers that report no employees are also a
potential compliance risk. We found 4,244 employers reporting zero employees, claiming about
$19 million in leave credits and 169 employee count lines that were blank, claiming about $81
million in leave credits.441
Form instructions for line 1 ask for the employee count as of a speciﬁc pay period in the quarter,
while eligibility for leave credits is determined by employee counts on the dates that the
employees took leave.442 Form 943, Employer’s Annual Federal Tax Return for Agricultural Employees,
has a similar line that asks for an employee count as of the pay period that includes March 12,
2020.443 Because the employee counts on these forms only account for one pay period, they are
imperfect determinants of eligibility, but could serve as a screening tool for compliance activities
after refunds are issued.
IRS has a draft compliance plan for examining tax credits and oﬃcials said they are analyzing
Form 941 data to aid in considering diﬀerent compliance approaches. The draft plan mentions the
possibility of using ﬁlters to identify leave credit claimants with 500 or more employees. February
2021 revisions to the plan did not mention using employee counts for compliance and IRS oﬃcials
have not committed to use an employee count ﬁlter for compliance. IRS oﬃcials also said they
have identiﬁed taxpayer errors in some employers’ entries. For Forms 941, IRS oﬃcials said they
would ensure compliance with the law through examinations, which would include reviewing
payroll and other records to conﬁrm employee counts. IRS oﬃcials said they examine a small
number of Forms 941 (0.1 percent for ﬁscal year 2019).
IRS’s Strategic Plan includes a strategic objective on resolving compliance issues, which includes
activities to develop early-warning and notiﬁcation systems to engage taxpayers to resolve
compliance issues and errors faster. The employee count line on Forms 941 and 943, although not
a perfect reﬂection of the tax credits’ requirements, is a possible tool that IRS could use to ensure
compliance. IRS already uses employee count information from Form 7200 to validate eligibility for
advance payments of tax credits. Speciﬁcally, IRS sends rejection letters to leave credits claimants
who report 500 or more employees on Form 7200, line D. IRS has an opportunity to also use
Form 941 and 943 employee count data, along with other information as needed. For example,
employers that report 500 or more employees—or some other threshold value—on these forms
could be contacted and asked to resolve the discrepancy or return any credit claims for which they
were not eligible.
we analyzed employee counts by client on Schedule R, rather than aggregated counts reported on the Form 941 for
these employers.
441Although sole proprietors are eligible for the credit, they are instructed to ﬁle for the credit on their income tax
return. Some of the employers reporting zero employees have closed, based on Form 941 information. Other employers
may have had no employees during the pay period for which the Form 941 instructions request employee counts, but
had employees at other times in the quarter. The returns with no value in line 1 were all paper returns, suggesting IRS
error transcribing the returns. Regardless of the error source, IRS could follow up on these returns.
442For example, for the second quarter, employers are instructed to report as of the pay period that includes June 12.
443We have not analyzed Forms 943 for 2020 because data were not available in time for this report.
Page 283
GAO-21-387

IRS could apply additional criteria to further target compliance eﬀorts to employers the agency
deems as potentially signiﬁcant compliance risks. For example, IRS could identify and exclude
from this eﬀort any employers with a tax credit amount below a particular dollar threshold or
employers who are included in other compliance eﬀorts. This approach could be less resource
intensive than examinations. Further, since IRS examines around 0.1 percent of Forms 941 per
ﬁscal year, it risks not identifying and addressing a large percentage of potentially ineligible claims.
In advance of ﬁrst and second quarter 2021 Form 941 ﬁlings, IRS could also conduct
outreach—such as through an email, frequently asked questions, or other online tips—to inform
employers about the importance of properly reporting employee counts. IRS previously issued
other communication on COVID-19 related tax credits, such as a “tax tip” issued in April 2020
outlining common errors on Form 7200. Although in November 2020 IRS issued a tax tip on Form
941, it did not mention employee counts. Such communication to employment tax ﬁlers would
contribute to the IRS strategic goal to help taxpayers understand their responsibilities for tax
compliance. This action could also result in a decrease in leave credit claims with employee counts
that are signiﬁcantly inconsistent with FFCRA eligibility, beginning with ﬁrst quarter Forms 941 that
are due April 30, 2021.
Census survey data on small businesses’ use of paid leave credits and the Employee
Retention Credit. Due to limitations of the employee counts on Form 941 and the limited data
available in time for this report, we analyzed data from the U.S. Census Bureau’s Small Business
Pulse Survey to identify characteristics of small businesses that reported receiving the paid leave
credits and the Employee Retention Credit.
The 2020 Small Business Pulse Survey, an experimental data product, is a federal statistical rapid
response survey conducted by the U.S. Census Bureau to measure small business experiences
during the COVID-19 pandemic. The Census Bureau reports that nonresponse bias may be an
issue, but states that precautionary steps were taken in the collection, processing, and tabulation
of the data in an eﬀort to minimize the inﬂuence of nonresponse bias.444
Due to nonresponse, we do not know whether estimates based on respondents to this survey
would represent nonresponding businesses, including nonresponding business that recently
closed or that diﬀer in terms of the survey items being measured. In addition, the sampling frame
for the survey was restricted to businesses with an active email and that were single location
businesses, therefore this survey does not necessarily represent other types of businesses. All
estimates we present based on this survey have the same potential limitation. Because of the
limited data available on the characteristics of small businesses using the credits, we chose to use
these data with the known limitations.
Among small businesses with fewer than 500 employees, estimated receipt of the credits was
generally low and varied by industry, according to data from the Small Business Pulse Survey (see
table).
444U.S. Census Bureau oﬃcials stated that they plan to conduct a nonresponse bias analysis and expect to complete it
by June 30, 2021. In addition, for the survey week covering January 4-10, 2021, response rates by state ranged from 16 to
30 percent.
Page 284
GAO-21-387

• According to the U.S. Census Bureau’s Small Business Pulse Survey, as of January 10, 2021,
a signiﬁcantly higher percentage of small businesses in the following industries reported
receiving assistance from the paid leave credits compared to the national average across all
sectors: manufacturing (9.6 percent) and health care and social assistance (8.3 percent).445
Industries in which a signiﬁcantly lower percentage of businesses reported receiving
assistance from the paid leave credits, as compared to the national average, include ﬁnance
and insurance (1.3 percent), information (2 percent), educational services (2.1 percent), real
estate and rental and leasing (2.1 percent), transportation and warehousing (2.2 percent),
wholesale trade (2.8 percent), other services except public administration (3.1 percent), and
professional, scientiﬁc, and technical services (3.5 percent).
• Small businesses in some industries reported greater receipt of the Employee Retention
Credit, according to estimates from Census’ Small Business Pulse Survey. A signiﬁcantly
higher percentage of businesses in the following industries reported receiving assistance
from the Employee Retention Credit, as compared to the national average across all sectors:
arts, entertainment, and recreation (3.2 percent) and accommodation and food service (1.9
percent). A signiﬁcantly lower percentage of small businesses in retail trade (0.2 percent)
reported receiving assistance from the Employee Retention Credit as compared to the national
average.
445Data analyzed was for the week of January 4-10, 2021. Survey respondents self-reported whether they had
received assistance from the included credits. All Small Business Pulse Survey estimates in this enclosure have
a margin of error of ± 1.7 percentage points or less at the 95 percent conﬁdence level, unless noted otherwise.
Industry-speciﬁc percentages were calculated for each two-digit North American Industry Classiﬁcation System
(NAICS) code represented in the survey for that week.
Page 285
GAO-21-387

Small Business Pulse Survey’s Estimated Percentage of Small Businesses Receiving Paid Leave Credits and
Employee Retention Credits, by Industry, as of January 10, 2021
Industry
Estimated percentage
receiving paid leave credits
Estimated percentage receiving
Employee Retention Credit
Manufacturing
9.6*
0.5
Health Care and Social Assistance
8.3*
0.6
Utilities
6.5
-
Administrative and Support and Waste
Management and Remediation Services
5.3
-
Construction
5.3
0.4
Arts, Entertainment, and Recreation
5.2
3.2*
Accommodation and Food Services
5.0
1.9*
Mining, Quarrying, Oil and Gas Extraction
3.9
-
Retail Trade
3.6
0.2*
Professional, Scientiﬁc, and Technical Services
3.5*
0.6
Other Services, except Public Administration
3.1*
0.4
Wholesale Trade
2.8*
0.5
Transportation and Warehousing
2.2*
0.3
Real Estate and Rental and Leasing
2.1*
0.4
Educational Services
2.1*
1.0
Information
2.0*
0.7
Finance and Insurance
1.3*
-
Average across all industries
4.5
0.6
Source: GAO analysis of U.S. Census Bureau’s Small Business Pulse Survey (week of January 4-10, 2021). | GAO-21-387
Note: An asterisk (*) indicates the estimate is statistically diﬀerent at the 95 percent conﬁdence level when compared to the
national average across all industries for each credit. We compared the conﬁdence intervals and determined the diﬀerence to
be signiﬁcant if the conﬁdence intervals did not overlap. All Small Business Pulse Survey estimates in this table have a margin
of error of ± 1.7 percentage points or less at the 95 percent conﬁdence level, with two exceptions. The margins of error for the
Utilities industry and Mining, Quarrying, Oil and Gas Extraction industry were ± 5.4 and 4.6 percentage points, respectively.
In addition, Small Business Pulse Survey results are weekly data products and are subject to suppression based on overall
response and disclosure avoidance thresholds set by the U.S. Census Bureau. As a result, some data in the table above have
been suppressed, as indicated by a “-“. Due to nonresponse, we do not know whether estimates based on respondents to this
survey would represent nonresponding businesses, including nonresponding business that recently closed or that diﬀer in
terms of the survey items being measured. The sampling frame for the survey was restricted to businesses with an active email
and that were single location businesses.
Page 286
GAO-21-387

Demographics of business owners. According to our analysis of 2018 estimates from the 2019
U.S. Census Bureau’s Annual Business Survey (ABS), the latest available estimates, a signiﬁcantly
higher percentage of businesses are male-owned rather than female-owned (63.6 percent
compared to 20.8 percent, with 15.7 percent of ﬁrms classiﬁed as equally male-/female-owned).446
An estimated 86.7 percent of businesses are White-owned, with signiﬁcantly fewer businesses
being Black-owned (2.3 percent) and Asian-owned (about 10.5 percent). A signiﬁcantly higher
percentage of ﬁrms are non-Hispanic-owned than Hispanic-owned as well (93.1 percent compared
to 6.0 percent).447
We cannot draw any conclusions about the sex, race, or ethnicity of the business owners that
reported receiving the paid leave credits and Employee Retention Credit because we do not
have business-level demographic data for businesses that reported receiving the credits. In the
absence of such business-level data, we compared industry-level data, and we did not ﬁnd a clear
relationship between the demographic makeup of business owners and small businesses’ receipt
of the two tax credits by industry.448
Some industries with a higher percentage of businesses reporting receipt of one of the credits
were industries that had higher percentages of businesses with owners classiﬁed as female, Black,
Asian, or Hispanic.
• The health care and social assistance industry had a higher percentage of small businesses
that reported receiving assistance from the paid leave credits. This industry also had a higher
percentage of businesses with owners classiﬁed as female, Black, and Asian.
446All estimates in this paragraph have a margin of error of ± 0.4 percentage points or less at the 95 percent conﬁdence
level.
447The U.S. Census Bureau classiﬁed ﬁrms by the sex, race, and ethnicity of ﬁrm owners. According to the U.S. Census
Bureau, not all ﬁrms were classiﬁable by sex, race, and ethnicity. Firms not classiﬁable by sex, race, and ethnicity include
ﬁrms that have no owners with a 10 percent or greater ownership of the stock or equity in the business. In addition,
ﬁrms could be classiﬁed as more than one racial group. This might happen when the sole owner was reported to
be of more than one race, when the majority owner was reported to be of more than one race, or when a majority
combination of owners was reported to be of more than one race. Other race categories not described in this enclosure
include American Indian and Alaska Native, Native Hawaiian and Other Paciﬁc Islander, Minority, Nonminority, and
Equally Minority/Nonminority. In the ethnicity grouping, ﬁrms could be also be classiﬁed as Equally Hispanic/non-
Hispanic. All sex, race, and ethnicity percentages were calculated using the total number of classiﬁable ﬁrms as the
denominator.
448We determined that estimates of owner’s race or ethnicity by business size and industry available through Census’
published tables of ABS estimates were not reliable for our purposes, as many of these estimates were suppressed.
Census suppresses estimates when there are data quality concerns such as high sampling variability or poor response
quality. Due to time constraints for this report, we were unable to examine alternative groupings of business size and
race or ethnicity, such as through an analysis of ABS microdata, necessary to determine groupings of race or ethnicity
and business size within industries that produce reliable estimates. Instead, we examined sex, race, and ethnicity by
industry for all businesses, rather than by business size, since these estimates in Census’ ABS tables generally were not
suppressed. Based on our analysis of ABS data, an estimated 99.7 percent of employer ﬁrms are small businesses (less
than 500 employees). However, this may vary by industry. Among the industries in our analysis, the percent of ﬁrms
that are small ranged from between 96.1 and 99.9 percent. We could not determine the percent of small ﬁrms for three
industries in our analysis, due to data suppression issues.
Page 287
GAO-21-387

• The accommodation and food industry had a higher percentage of small businesses that
reported receiving assistance from the Employee Retention Credit. This industry also had a
higher percentage of businesses with owners classiﬁed as Asian or Hispanic.
Some industries with higher percentages of businesses reporting receipt of one of the credits were
industries that had lower percentages of businesses with owners classiﬁed as female, Black, Asian,
or Hispanic.
• The manufacturing industry had a higher percentage of small businesses that reported
receiving assistance from the paid leave credits. This industry also had a lower percentage of
businesses with owners classiﬁed as female, Black, Asian, and Hispanic.
• The arts, entertainment, and recreation industry had a higher percentage of small businesses
that reported receiving assistance from the Employee Retention Credit. This industry also had
a lower percentage of businesses with owners classiﬁed as Asian or Hispanic.
Agency Comments
We provided IRS, Treasury, the Department of Agriculture, including the NFC; Department of
Commerce, including the U.S. Census Bureau; and the Oﬃce of Management and Budget with
a draft of this enclosure. IRS’s written comments are reproduced in appendix VIII, and IRS and
Treasury provided technical comments, which we incorporated as appropriate. The Department of
Agriculture, the U.S. Census Bureau and the Oﬃce of Management and Budget did not have any
comments on this enclosure.
In its written comments, IRS agreed with both recommendations. For the recommendation to
leverage employee counts, IRS said its compliance plan states that IRS will identify employers
with more than 499 employees to identify potentially ineligible COVID-19 related sick and family
credit claims. The IRS compliance plan only states that using employee counts for identifying credit
claim errors is one of several possibilities under consideration, but we are pleased that IRS is now
planning to leverage employee count data.
Methodology
To conduct our work, we reviewed federal laws and agency documents; and interviewed oﬃcials at
IRS. We also analyzed IRS data as of February 25, 2021 and the most recent Census data from the
Small Business Pulse Survey and the Annual Business Survey (ABS).
We analyzed data on paid leave credits receipt, Employee Retention Credit receipt, and industry
from the Small Business Pulse Survey for the week of January 4-10, 2021. All Small Business
Pulse Survey estimates in this enclosure have a margin of error of ± 1.7 percentage points or
less at the 95 percent conﬁdence level, with two exceptions. For the estimated percentage
of businesses receiving the paid leave credits, the margins of error for the Utilities industry
and Mining, Quarrying, Oil and Gas Extraction industry were ± 5.4 and 4.6 percentage points,
respectively, at the 95 percent conﬁdence level.
Page 288
GAO-21-387

The Census Bureau has not yet published its analysis of nonresponse bias for the Pulse Survey
and reports that nonresponse bias may be an issue, but states that precautionary steps were
taken in the collection, processing, and tabulation of the data in an eﬀort to minimize the inﬂuence
of nonresponse bias. Due to nonresponse, we do not know whether estimates would represent
nonresponding businesses, including nonresponding businesses that recently closed or that diﬀer
in terms of the survey items being measured. In addition, the sampling frame for the survey was
restricted to businesses with an active email and that were single location businesses, therefore
this survey does not necessarily represent other types of businesses. Without a published
nonresponse bias analysis, the reliability of the Pulse Survey data is undetermined. Because of the
limited data available on the characteristics of small businesses using the credits of interest, we
chose to use these data with the known limitations.
We also reviewed data on the percent of business owners with certain demographic traits,
by industry, using the 2019 Annual Business Survey. In addition, some ﬁrms in the ABS data
were classiﬁable by sex, race, and ethnicity, and some ﬁrms were not classiﬁable by sex, race,
and ethnicity. The percentages presented in this section were calculated using the number of
classiﬁable ﬁrms as the denominator. However, we also calculated percentages using the total
number of ﬁrms in order to determine if it would impact our results. The change in denominator
did not have a meaningful impact on our ﬁndings. There are practical diﬃculties in conducting
any survey that may produce errors. There are two types of error associated with estimates
based on data from sampled surveys: sampling error and nonsampling errors. We approximated
sampling errors for all of the estimates we included in this report. However, the accuracy of the
data depends on both measureable sampling errors and unmeasurable nonsampling errors. For
particular estimates, the total error may considerably exceed the measured error. To assess the
reliability of the ABS data, we reviewed Census technical documentation and reviewed written
responses of Census oﬃcials to our questions. We determined that the data were suﬃciently
reliable for our purposes.
Contact information: Jessica Lucas-Judy, (202) 512-6806, lucasjudyj@gao.gov
Page 289
GAO-21-387

Community Services Block Grant
CARES Act funding for the Community Services Block Grant program assisted local agencies in
meeting immediate community needs, such as emergency food and housing assistance, during
the pandemic.
Entity involved: Administration for Children and Families, within the Department of Health and
Human Services
Key Considerations and Future GAO Work
In November 2019, we reported on the Department of Health and Human Services’ (HHS)
and states’ oversight of grant recipients’ activities under the Community Services Block Grant
(CSBG) program. Among other matters, we found that HHS recently redesigned its performance
management approach to improve its ability to assess whether the CSBG program is meeting
the national program goals to reduce poverty, promote self-suﬃciency, and revitalize low-income
communities. However, several elements of the approach did not align with leading practices in
federal performance management. We recommended that in developing a new performance
management approach for the CSBG program, HHS should include information on how its
national performance measure and state outcome measures align with national program goals
and include a written plan for how it will assess data reliability. HHS oﬃcials agreed with our
recommendations, and we will continue to monitor the agency’s progress in implementing them.
Background
In ﬁscal year 2020, the CSBG program, authorized by the Community Services Block Grant Act, as
amended (CSBG Act), provided $740 million to states and over 1,000 local agencies to ﬁght poverty
in the U.S.449 Local agencies, predominantly community action agencies, use CSBG funding to help
provide services such as employment, education, ﬁnancial management, housing, nutrition, and
emergency services to help program participants achieve economic self-suﬃciency; to revitalize
communities; and to empower families.450 In ﬁscal year 2018, CSBG served over 15.3 million low-
income individuals in nearly 6.3 million families, according to the most recent data.
The Administration for Children and Families’ (ACF) Oﬃce of Community Services (OCS), within
HHS, is primarily responsible for overseeing states that receive the block grant, and states are
responsible for overseeing local agencies that receive the grant funding. States must prepare state
plans for using the CSBG grant funds; distribute the funds to local agencies; report annually to
OCS; and conduct a full onsite review of each local entity at least once every three years.451
449The CSBG Act is codiﬁed at 42 U.S.C. §§ 9901-9926. In this enclosure, we use “states” to refer to “states, territories,
and tribes.”
450Community action agencies are private or public nonproﬁt organizations that were created to combat poverty in
geographically designated areas. Other local recipients of CSBG funds include local governments, federal and state-
recognized Indian tribes and tribal organizations, and organizations with migrant and seasonal farm worker programs.
451States must distribute no less than 90 percent of the CSBG grant funds to local agencies, and may reserve a portion
of funds not to exceed 10 percent for administrative costs, training, technical assistance, and other activities, in
accordance with the CSBG Act. 42 U.S.C. § 9907.
Page 290
GAO-21-387

The CSBG program was provided with $1 billion in additional funds under the March 2020
CARES Act to prevent, prepare for, and respond to COVID-19.452 In May 2020, ACF awarded the
supplemental CSBG CARES Act funds to states using the standard formula for regular annual
appropriated funds. As of February 2021, ACF had allotted $985,000,000 of the CARES Act funds
to states.453 Given the CARES Act funds were a supplement to the annual CSBG appropriation for
ﬁscal year 2020, ACF initially withheld about $43.5 million from 12 states that had already met
their maximum allotment under the CSBG Act, but agency oﬃcials stated that, as of February
2021, these funds were released.454 The Consolidated Appropriations Act, 2021 included a
provision that excludes CARES Act funds from the maximum allotment provision.455
The CARES Act and ACF allowed ﬂexibilities to help states provide supplemental funds to local
agencies quickly and minimize administrative burden so agencies could focus on meeting
immediate community needs during the pandemic (see ﬁgure).
452Pub. L. No. 116-136, 134 Stat. 281, 558 (2020).
453As of February 24, 2021, ACF conﬁrmed this was the ﬁnal allotment. The total CSBG CARES Act appropriation included
$971,398,810 for states, $5,000,000 for territories, and $8,601,190 for tribes.
454See CSBG Act Section 675B(b)(3) (42 U.S.C. § 9906(b)(3)). The 12 states subject to the maximum allotment were
Alaska, Delaware, Hawaii, Idaho, Montana, Nevada, New Hampshire, North Dakota, South Dakota, Utah, Vermont, and
Wyoming.
455Consolidated Appropriations Act, 2021, div. M, tit. III, § 306, 134 Stat. 1182, 1923.
Page 291
GAO-21-387

Community Services Block Grant (CSBG) Flexibilities during the COVID-19 Pandemic, as of March 2021
Note: In addition to those mentioned in the table, ACF issued other guidance documents between March 2020 and March 2021.
Overview of Key Issues
CARES Act funding and related ﬂexibilities assisted state and local CSBG agencies in meeting
immediate community needs during the pandemic. For example, according to the National
Association for State Community Services Programs (NASCSP), a majority of states used the
ﬂexibility to increase their income eligibility threshold to serve more households. NASCSP also
reported that states and local agencies were able to quickly change to a remote environment to
deliver services safely, including allowing potential recipients to submit online applications.
However, according to oﬃcials with NASCSP and three states we contacted, states initially faced
challenges in obtaining adequate and timely guidance about federal requirements for developing
plans, reporting, and monitoring the use of funds. According to NASCSP, in many cases, states
received guidance after implementing contracts with local agencies and releasing funds. In
particular, ACF issued guidance and supporting information on reporting and monitoring nearly a
year into the public health emergency. The aﬀected guidance covered the following:
Page 292
GAO-21-387

• Simpliﬁed procedures for state plans. According to NASCSP, states received the CARES Act
funds from ACF in May 2020, and the majority of states were able to distribute the funds to
local agencies within 30 days of receiving the funds. ACF also announced in May 2020 that
states needed to amend their CSBG plans to address their use of CARES Act funds and submit
them by September 1, 2020.
According to NASCSP and state oﬃcials we contacted, allowing states to prepare abbreviated
plans for using CARES Act funds during the COVID-19 pandemic helped streamline states’
eﬀorts, but ACF delayed issuing guidance about the modiﬁcations to federal requirements for
state plans. Speciﬁcally, the agency did not issue guidance on these plans until July and August
2020.
The delay in issuing guidance limited the time states had to fully develop their state plans with
input from their local agencies that would be providing the direct services to clients, according
to NASCSP. Without local agency input, states may have missed obtaining information that
could have been shared with federal stakeholders about the speciﬁc needs of their local
communities and the agencies’ plans for how to use the funds to address these needs.
• OMB ﬂexibilities. According to NASCSP, states found the Oﬃce of Management and Budget
(OMB) ﬂexibilities to be helpful. However, NASCSP and state oﬃcials we contacted cited
unclear guidance on what additional costs grantees could cover with CSBG funds and concern
about the administrative burden of documentation regarding the requirement to exhaust
other funding sources and reduce operational costs (such as initiating rent renegotiations)
before charging CSBG during the public health emergency. ACF issued two documents in
March 2020 acknowledging the OMB ﬂexibilities. While these documents did not provide
detailed guidance on using the OMB ﬂexibilities, ACF oﬃcials told us that they responded with
technical assistance to email requests from individual grantees.
• Briefer reporting requirements. According to ACF guidance, during the pandemic, the
required reports will be similar to the regular CSBG reports and will collect information on
the number and characteristics of people served, services provided, and outcomes, but will
have signiﬁcant sections removed to avoid duplication of eﬀort and minimize burden on
agencies. The NASCSP oﬃcial mentioned that states and local agencies had been serving
households and collecting information on their use of funds from March to December 2020
without ﬁnalized reporting requirements and without training on ACF’s new briefer reporting
forms.
ACF oﬃcials told us that the agency ﬁrst discussed the reporting requirements for the CARES
Act supplemental funds with states in a September 2020 conference presentation and emailed
the state and local agencies regarding the revised reporting requirements and reporting forms
in December 2020. As of February 2021, oﬃcials said that within several weeks, the agency
would ﬁnalize the automated system for reporting and would provide training and technical
assistance related to the reporting requirements (including how to use the forms and the
automated data collection system) via webinar, quarterly calls, and individualized training and
technical assistance.
• Monitoring during COVID-19. Although the CSBG Act requires onsite visits, the NASCSP
oﬃcial said that states have been monitoring local agencies through desk reviews and
virtual/remote processes to limit person-to-person contact, and have invested in online
systems to share documents and interact safely with local agencies during the public health
Page 293
GAO-21-387

emergency.456 NASCSP and oﬃcials in two states said that, as of December 2020, they faced
challenges in obtaining adequate and timely guidance about monitoring fund use. At that
time, ACF had not released any guidance on whether these revised state procedures would
meet monitoring requirements.
ACF notiﬁed states in April 2020 that states may need to postpone onsite monitoring of local
agencies during the COVID-19 pandemic; that this does not suspend statutory requirements
for the onsite monitoring; and that ACF is exploring whether any ﬂexibilities in monitoring
can be provided during the pandemic. OCS oﬃcials reported in February 2021 that the
agency has completed its research and consulted with the HHS Oﬃce of General Counsel in
drafting guidance to allow states to conduct virtual instead of onsite monitoring. On March 10,
2021, ACF issued this monitoring guidance, and oﬃcials said the agency will provide detailed
information to states in a subsequent webinar.
Beyond the above mentioned eﬀorts, since CARES Act implementation, ACF has issued additional
guidance and participated in virtual meetings and quarterly calls with states to provide
information about the ﬂexibilities for distributing and using CARES Act funds, among other things.
ACF oﬃcials said the agency also has reached out to grantees through calls and emails to provide
technical assistance, including targeting states that had been spending the supplemental funds
at a slower rate than other states. Furthermore, an oﬃcial in one state said the state was able
to address its concerns about implementing the OMB ﬂexibilities with technical assistance from
NASCSP.457
Agency Comments
We provided a draft of this enclosure to ACF and OMB for review and comment. ACF provided
technical comments that we incorporated when appropriate. OMB did not provide comments on
this enclosure.
Methodology
To conduct this work, we reviewed the most recent HHS/ACF data as of February 24, 2021;
reviewed federal laws and agency guidance; and obtained information from ACF oﬃcials on
COVID-19 related eﬀorts for the CSBG program. We also contacted oﬃcials from NASCSP and
three states that were included in our November 2019 report on CSBG to obtain information on
state and local oﬃcials’ experiences with administering CSBG programs during the pandemic. We
456The CSBG Act requires states to conduct onsite monitoring as follows: (1) each local agency at least once within
each three-year period, (2) each new local agency after the ﬁrst year of receiving CSBG funds, and (3) follow-up
reviews including return visits to local agencies that fail to meet goals, standards, and requirements established by
the states. 42 U.S.C. § 9914(a).
457This state also received help from Community Action Program Legal Services (CAPLAW), a nonproﬁt membership
corporation that is the national legal expert for community action agencies, and provides consultations, training, and
resources to local agencies.
Page 294
GAO-21-387

assessed the reliability of data on individuals and families receiving program services by reviewing
written statements from agency oﬃcials. We determined the data were suﬃciently reliable for the
purposes of our reporting objective.
Contact information: Kathryn A. Larin, (202) 512-7215 or larink@gao.gov
Related GAO Product
Community Services Block Grant: Better Alignment of Outcome Measures with Program Goals
Could Help Assess National Eﬀectiveness. GAO-20-25. Washington, D.C.: November 19, 2019.
Page 295
GAO-21-387

Economic Injury Disaster Loan Program
The Small Business Administration has begun making targeted Economic Injury Disaster Loan
program advances but has not adequately assessed program risks, including the risk of fraud, and
needs to address accounting and control deﬁciencies.
Entity involved: Small Business Administration
Recommendations for Executive Action
We are making the following three recommendations to the Small Business Administration:
The Administrator of the Small Business Administration should conduct and document a fraud risk
assessment for the Economic Injury Disaster Loan program.
The Administrator of the Small Business Administration should develop a strategy that outlines
speciﬁc actions to address assessed fraud risks in the Economic Injury Disaster Loan program on a
continuous basis.
The Administrator of the Small Business Administration should implement a comprehensive
oversight plan to identify and respond to risks in the Economic Injury Disaster Loan program to
help ensure program integrity, achieve program eﬀectiveness, and address potential fraud.
The Small Business Administration agreed with these three recommendations.
Key Considerations and Future GAO Work
In January 2021, we recommended that the Administrator of the Small Business Administration
(SBA) should develop and implement portfolio-level data analytics across Economic Injury Disaster
Loan (EIDL) program loans and advances made in response to COVID-19 to detect potentially
ineligible and fraudulent applications. SBA did not agree or disagree with our recommendation
and has not taken steps to implement it.
In December 2020, SBA’s independent ﬁnancial statement auditor issued a disclaimer of opinion
on SBA’s consolidated ﬁnancial statements as of and for the year ending September 30, 2020,
meaning the auditor was unable to express an opinion due to insuﬃcient evidence.458 As part
of the basis for the disclaimer, the auditor stated that SBA was unable to provide adequate
documentation to support a signiﬁcant number of transactions and account balances related to
EIDL due to inadequate processes and controls. The auditor identiﬁed two material weaknesses
and made seven recommendations to address controls related to accounting and reporting for
EIDL and evaluation and monitoring of service organization (contractor) controls. In addition, the
auditor identiﬁed one material weakness and made ﬁve recommendations to address entity-level
controls that aﬀect the operation of EIDL. SBA did not fully agree with the weaknesses and neither
agreed nor disagreed with the recommendations.
458Small Business Administration, Oﬃce of Performance Management and the Chief Financial Oﬃcer, Agency Financial
Report for Fiscal Year 2020 (Washington, D.C.: Dec. 18, 2020).
Page 296
GAO-21-387

SBA has begun to provide us with information on the oversight of the program and the role
of its contractors. We have ongoing work to examine SBA’s actions to address internal control
weaknesses and the integrity of the EIDL program. As part of our ongoing work, we will monitor
SBA’s progress toward developing and implementing corrective actions to address the material
weaknesses identiﬁed by its ﬁnancial statement auditor. In addition, we remain concerned about
fraud in the EIDL program, and have ongoing work related to fraud risk management.
Background
Since March 2020, SBA has provided millions of EIDL loans and advances to assist small businesses
and nonproﬁts experiencing economic injury caused by COVID-19. In the Paycheck Protection
Program and Health Care Enhancement (PPPHCE) Act, Congress appropriated $50 billion in loan
credit subsidies for SBA to cover the cost of making EIDL loans. Additionally, in the CARES Act and
the PPPHCE Act, Congress appropriated $20 billion for EIDL advances, a new component of the
program that provided direct advance payments of up to $10,000 to small businesses after they
submitted their loan applications. On July 11, 2020, SBA announced that it had fully allocated the
$20 billion in funding for EIDL advances.
On December 27, 2020, under the Consolidated Appropriations Act, 2021, Congress appropriated
an additional $20 billion for targeted EIDL advances to eligible entities with 300 or fewer
employees that are located in low-income communities and experienced an economic loss of
greater than 30 percent. Qualifying entities may receive up to $10,000 in targeted advances.459
Previously, SBA calculated the advances provided under the CARES Act based on the applicant’s
number of employees up to $10,000. These advances do not have to be repaid.
On March 11, 2021, under the American Rescue Plan Act of 2021, Congress appropriated
additional funding for entities that qualiﬁed for targeted EIDL advances under the Consolidated
Appropriations Act, 2021.460 Congress appropriated an additional $10 billion for eligible entities
that have not received the full amount of $10,000 in targeted EIDL advances. Congress also
appropriated $5 billion to provide an additional $5,000 for eligible entities in low-income
communities that suﬀered economic loss of greater than 50 percent and employ not more than
10 employees. The $5,000 is available in addition to advances obtained under the CARES Act or
targeted advances under the Consolidated Appropriations Act, 2021. The act also appropriated
$70 million for EIDL loans and additional funding for administrative expenses for several SBA
programs including the targeted advance programs and the EIDL loan program.
In March 2021, we added a new area to our High-Risk List—Emergency Loans for Small
Businesses—because of concerns regarding SBA’s administration of EIDL loans and advances and
implementation of the Paycheck Protection Program following COVID-19. See the enclosure on the
Paycheck Protection Program in appendix I for more information.
459Pub. L. No. 116-260, div. N, tit. III, § 331, 134 Stat. 1182, 2043-45.
460Pub. L. No. 117-2, §§ 5002, 5006, 135 Stat. 4, 85, 92.
Page 297
GAO-21-387

As of January 31, 2021, SBA oﬃcials stated that the agency had $24.2 billion remaining of the
$50 billion in loan credit subsidy to facilitate lending related to COVID-19, which would allow the
agency to make about $271.6 billion in new EIDL loans.
Overview of Key Issues
SBA has begun to implement targeted EIDL advances. The Consolidated Appropriations Act,
2021, prioritized targeted EIDL advances for applicants that received partial advances (less than
$10,000) under the CARES Act. SBA data show that about 4.9 million out of the 5.8 million total
advance recipients received partial advances. Of this group, SBA oﬃcials estimated that about 2.5
million are located in low-income communities. On February 1, 2021, SBA began contacting these
applicants in phases. SBA oﬃcials said that the agency system is able to contact up to 200,000
applicants each day in the order in which they ﬁrst submitted their EIDL applications. As required
by statute, after processing applicants that have received partial advances, SBA plans to contact
those that applied for EIDL assistance on or before December 27, 2020, but did not receive an EIDL
advance due to the lack of program funding. Similarly, SBA plans to contact these applicants in the
order in which they initially applied for EIDL. SBA oﬃcials said the agency anticipates announcing
further changes for the targeted advances due to increased appropriations under the American
Rescue Plan Act of 2021 and that pending funding availability, those that are eligible and applied
for an EIDL loan after December 27, 2020 may be able to apply for targeted advances.
The Consolidated Appropriations Act, 2021, removed the CARES Act provision that prohibited SBA
from requiring tax records as part of its eligibility determination. SBA is requesting that those
applying for the targeted advances verify their eligibility requirements and provide monthly
revenue information and permission for SBA to request 2019 tax transcripts from the Internal
Revenue Service (IRS). The tax transcript will allow SBA to verify that the applicant business existed
and ﬁled taxes in 2019. The Consolidated Appropriations Act, 2021, also requires SBA to process
targeted EIDL advances within 21 days of receiving a completed application. SBA begins measuring
processing time on the day that the agency receives all requested documentation from the
applicant. SBA oﬃcials anticipate the agency will meet the 21-day processing requirement.
SBA plans to require additional tax documentation for processing of loans. In addition to
requesting tax transcripts for the targeted EIDL advances, SBA oﬃcials told us that the agency
plans to revise its EIDL loan application to systematically request that all new loan applicants
provide the agency authority to request tax transcripts from IRS. SBA oﬃcials have not provided
details on when this change will go into eﬀect, but said that SBA can now request tax transcripts as
needed as part of the loan review process. Additionally, SBA oﬃcials said SBA has required IRS tax
records since around May 2020 for applicants that request reconsideration or appeal of their loan
applications, such as after being declined. SBA oﬃcials told us it was challenging to verify applicant
eligibility for EIDL without the ability to obtain tax records.
While SBA is waiting to revise its EIDL loan application to systematically request tax transcripts,
SBA has not issued interim guidance or updated a reference guide that loan oﬃcers use as part
of loan review to detail when loan oﬃcers should request tax transcripts or what tax transcript
information they should review. We are continuing to follow up on this issue in ongoing work.
Page 298
GAO-21-387

Processing time for EIDL loan applications has largely remained consistent. As of February
13, 2021, SBA had approved about 3.7 million loan applications and declined about 6.0 million
applications. Between August 1, 2020, and February 13, 2021, SBA’s cumulative average processing
time for loans ranged between 29 and 31 days. The cumulative average processing time for
approved loans ranged between 44 and 47 days, as compared to 16 and 22 days for declined
loans during the same period. In contrast, the cumulative average processing time for declined
applicants asking SBA to reconsider their applications increased and ranged from 14 to 47 days
during the same period.
Concerns remain about SBA’s inability to support EIDL accounting and related controls. In
December 2020, SBA’s independent ﬁnancial statement auditor issued a disclaimer of opinion
on SBA’s ﬁscal year 2020 consolidated ﬁnancial statements, meaning the auditor was unable
to express an opinion due to insuﬃcient evidence. As the basis for the disclaimer, the auditor
reported that SBA was unable to provide adequate documentation to support a signiﬁcant
number of transactions and account balances due to inadequate processes and controls
related to its implementation of its programs authorized under the CARES Act and related
legislation—speciﬁcally EIDL and the Paycheck Protection Program.
The auditor identiﬁed two material weaknesses in internal controls related to EIDL concerning
approval of EIDL loans and advances and oversight of EIDL service organizations. To process
EIDL loans and advances, SBA used a service organization’s system to ﬁrst automatically validate
applicants and then issue alerts, including fraud alerts, which SBA loan oﬃcers were to review
and mitigate. In its discussion of these material weaknesses, the auditor noted discrepancies
including more than one loan or advance approved and disbursed to the same borrower, and
identiﬁed over 6,000 disbursed EIDL loans (over $212 million total) issued to potentially ineligible
borrowers.461 The auditor also noted that SBA did not adequately design and implement controls
for the evaluation and monitoring of the service organization’s control environment, including the
operating eﬀectiveness of its validation controls for EIDL loans and advances.
In total, the auditor made seven recommendations to SBA to address these two material
weaknesses related to EIDL. Among other things, the auditor recommended that SBA
• review the EIDL portfolio and determine which transactions were made to ineligible recipients;
• implement controls to detect or prevent loans from being approved for ineligible applicants;
• train loan oﬃcers and supervisory loan oﬃcers to execute their responsibilities using
established guidance and standard operating procedures; and
• enhance its review and evaluation of service organization controls.
461Other discrepancies include loans and grants issued to borrowers with inaccurate or invalid tax identiﬁcation
numbers, employer identiﬁcation numbers, or Social Security numbers; loans issued that SBA ﬂagged as potentially
fraudulent; and loans issued to borrowers that SBA ﬂagged because the borrowers were excluded from doing business
with the government.
Page 299
GAO-21-387

SBA’s ﬁnancial statement auditor reported that deﬁciencies related to the majority of the
identiﬁed material weaknesses related to EIDL were caused by an inadequate entity-level control
environment at SBA—the agency’s overall management controls to establish an eﬀective internal
control system.462 Speciﬁcally, the auditor reported a material weakness in SBA’s entity-level
controls, citing that SBA management did not properly design and implement overall eﬀective
management controls to account for new and expanded programs, such as EIDL, under the CARES
Act and related legislation. The auditor issued ﬁve recommendations to improve entity-level
controls including, among other things, that SBA hold accountable individuals responsible for
overseeing management’s design, implementation, and operation of SBA’s internal control system;
developing and implementing monitoring controls; and documenting internal controls related to
CARES Act implementation and related legislation.
The auditor noted that the deﬁciencies were primarily caused by SBA prioritizing the
implementation of CARES Act provisions and related legislation as quickly and eﬃciently as
possible over designing and implementing eﬀective internal control processes. SBA moved quickly
to set up new programs and expand existing programs in order to help small businesses facing
adverse economic conditions as a result of COVID-19. In the case of EIDL, this included quickly
distributing loans and advances without adequately designing and implementing controls to help
ensure borrower eligibility and accurate recording.
SBA’s ﬁscal year 2020 agency ﬁnancial report describes the unprecedented scale of this eﬀort.
For example, SBA reported that it approved more than 3.6 million EIDL loans totaling $194 billion
in ﬁscal year 2020, which represented more than all of SBA’s prior disaster assistance lending
combined in the agency’s history. As a result, SBA’s reported loans receivable increased from $9.5
billion in ﬁscal year 2019 to $183 billion in ﬁscal year 2020.
SBA disagreed with the material weaknesses related to approval of EIDL loans and advances and
entity-level controls, partially agreed with the material weakness related to service organization
oversight, and neither agreed nor disagreed with the recommendations. However, SBA did
recognize that documentation of its processes and controls was not suﬃciently well developed
to support the ﬁnancial statement audit and stated that it is working diligently to correct any
shortcomings for future audits. We support the recommendations the auditor provided to address
control weaknesses related to EIDL, and we encourage SBA to continue to work to improve its
controls over the program, as well as to improve its documentation to support future ﬁnancial
statement audits.
Concerns remain about fraud risk management in the EIDL program. The Department of
Justice (DOJ) and law enforcement agencies have reported ongoing eﬀorts related to potential
fraud in the EIDL program. From May 2020 to February 2021, DOJ publicly announced charges
in over 30 fraud-related cases associated with EIDL loans and charged over 50 defendants. The
charges—ﬁled in federal courts across the U.S. and investigated by a range of law enforcement
462GAO’s Standards for Internal Control in the Federal Government provides the overall framework for establishing and
maintaining an eﬀective internal control system, and it lists ﬁve components of internal control representing the highest
level of the hierarchy of standards for internal control in the federal government. The ﬁve components of internal
control are (1) control environment, (2) risk assessment, (3) control activities, (4) information and communication, and
(5) monitoring. The ﬁve components of internal control must be eﬀectively designed, implemented, and operating, and
operating together in an integrated manner, for an internal control system to be eﬀective.
Page 300
GAO-21-387

agencies—include allegations of making false statements and engaging in identity theft, wire
and bank fraud, and money laundering, among other charges. As of February 2021, at least ﬁve
defendants had pleaded guilty to federal charges of defrauding the EIDL program. For more
information related to these guilty pleas, see the Federal Fraud-Related Cases enclosure in
appendix I.
In addition to ongoing prosecutions, law enforcement oﬃcials we spoke with noted a large
number of ongoing investigations and hotline complaints related to CARES Act loans, including
loans made under the EIDL program and the Paycheck Protection Program. A senior oﬃcial with
SBA’s Oﬃce of Inspector General (OIG) told us that, as of January 2021, SBA OIG had opened
over 260 investigations related to CARES Act loans, including EIDL loans—at least three times the
number of investigations the oﬃce would typically open in a year. Similarly, SBA OIG reported
receiving over 70,000 hotline complaints related to CARES Act programs, compared to the 700
to 800 it would receive in a typical year. SBA oﬃcials told us that the agency’s Oﬃce of Disaster
Assistance is supporting many of the DOJ and SBA OIG investigations through a team that
researches case ﬁles, responds to inquiries from law enforcement agencies, and shares data on
suspected fraud cases with the SBA OIG, DOJ, and U.S. Secret Service.
Law enforcement oﬃcials also reported systemic patterns of fraud across EIDL investigations.
Oﬃcials at SBA OIG and the Federal Bureau of Investigation told us that they have identiﬁed
systemic patterns of potential fraud including identity theft, false attestations on loan documents,
ﬁctitious and inﬂated employee counts, falsiﬁed tax documentation, and misuse of proceeds.
Similarly, we reported in January 2021 that we analyzed aggregate data on suspicious activity
reports ﬁled by ﬁnancial institutions from May to October 2020. These reports identiﬁed multiple
types of potentially suspicious activity related to EIDL, such as indicators of identity theft, the rapid
movement of funds, and forgeries.
SBA has taken some steps to mitigate fraud risks in the EIDL program. According to SBA oﬃcials,
SBA conducted an informal fraud risk assessment for EIDL that resulted in enhanced internal
controls. Speciﬁcally, SBA oﬃcials told us they considered both fraud risks facing EIDL and the
sources and likelihood of those risks, and residual risks. Further, SBA introduced new EIDL
program controls, such as conducting eligibility checks through the Department of the Treasury’s
Do Not Pay service and plans to obtain 2019 tax transcripts from IRS for the targeted advances.463
Additionally, SBA oﬃcials told us SBA increased staﬃng for its OIG liaison team that reviews
suspicious loans ﬂagged by loan oﬃcers and forwards referrals to SBA OIG. According to SBA OIG,
as of January 2021, it had received nearly 750,000 of these referrals related to identity theft and
over 585,000 referrals related to other potentially fraudulent activities associated with the EIDL
program.
Leading practices identiﬁed in GAO’s Fraud Risk Framework call for a strategic approach for
assessing and managing fraud risks.464 The Fraud Risk Framework notes that such an approach
463Department of the Treasury’s Do Not Pay service is an analytics tool that helps federal agencies detect and prevent
improper payments made to vendors, grantees, loan recipients, and beneﬁciaries. Agencies can check multiple data
sources in order to make payment eligibility decisions.
464The Fraud Risk Framework helps managers meet their responsibilities to assess and manage fraud risks as required
by federal internal control standards.
Page 301
GAO-21-387

includes designating an entity to lead fraud risk management activities. According to SBA oﬃcials,
the agency created the Fraud Risk Management Council, which has a direct reporting authority
to SBA’s Administrator and its associated Enterprise Risk Management Board, to oversee and
coordinate agency-wide management of fraud risk. In alignment with leading practices in the
Fraud Risk Framework, this council has a direct reporting line to senior-level managers at SBA and
is not located within SBA OIG. However, it is unclear at this time whether the council meets the
leading practices as a dedicated antifraud entity, including (1) understanding the program and its
operations, as well as the fraud risks and controls throughout the program, and (2) having deﬁned
responsibilities and the necessary authority across the program.
According to the Fraud Risk Framework, the dedicated antifraud entity should, among other
activities, manage the fraud risk assessment process and coordinate antifraud initiatives across
the program. The fraud risk assessment should (1) identify inherent fraud risks facing the program,
(2) assess the likelihood and impact of inherent fraud risks facing the program, (3) determine fraud
risk tolerance, (4) examine the suitability of existing fraud controls and prioritize residual fraud
risks, and (5) document the program’s fraud risk proﬁle.465 Such an assessment helps program
managers determine whether they have the right controls in place to combat the most likely and
impactful risks facing the program. The fraud risk assessment is particularly informative when the
volume and nature of fraud risk indicators signiﬁes an evolving fraud risk landscape, as conﬁrmed
by law enforcement oﬃcials for EIDL-related fraud. Further, the risk proﬁle serves as the basis
for the antifraud strategy, which deﬁnes key elements, such as responsibilities, activities, and
timelines for addressing residual risks and continuously identifying emerging fraud risks to the
program.
Although SBA has taken steps to identify and address risks on a loan-level basis through an
informal fraud risk assessment process, it has not conducted a comprehensive fraud risk
assessment in alignment with leading practices, nor documented its antifraud strategy outlining
a strategic approach to managing fraud risks to EIDL. According to SBA oﬃcials, given the rapid
response required to execute the program, SBA conducted an informal fraud risk assessment and,
as of February 2021, had not documented the results of its eﬀorts.
Although SBA’s initial steps are important, a comprehensive assessment that considers the
likelihood and impact of all inherent fraud risks, the suitability of existing controls, risk tolerance,
and prioritization of residual risk is key to ensuring resources are appropriately allocated to the
most pressing risks. Further, an antifraud strategy would help ensure that SBA takes a strategic,
risk-based approach to prevent, detect, and respond to fraud risks. Although SBA implemented a
number of preventive controls based on its informal fraud risk assessment, such as planning to
verify businesses by requesting 2019 tax transcripts from IRS for targeted advances, there may be
signiﬁcant fraud risks unaddressed by these controls. For example, the tax transcript veriﬁcation
is intended to provide validation of business operations before the program start date, but it
likely would be limited to detecting unsophisticated cases involving identity theft or synthetic
465According to federal internal control standards, inherent risk is the risk to an entity prior to considering
management’s response to the risk. Residual risk is the risk that remains after inherent risks have been mitigated by
existing control activities.
Page 302
GAO-21-387

identities.466 In addition to preventive controls, a fraud risk management strategy would help SBA
to continuously detect and respond to risks for loans and advances after they are made.
We recognize the importance of providing timely emergency loan assistance to small businesses.
Conducting a fraud risk assessment need not hinder program delivery and can in fact facilitate
program goals by ensuring that taxpayer dollars and government services serve their intended
purposes. Further, SBA has existing resources it can leverage in such an eﬀort. For example, SBA
could build on its informal fraud risk assessment and leverage existing resources provided by the
Oﬃce of Continuous Operations and Risk Management. This oﬃce can provide leadership and
resources informed by its enterprise risk management eﬀorts as well as insight into fraud risks
across SBA’s loan portfolios.
In January 2021, we reported that SBA provided loans and advances to potentially ineligible
entities. We recommended that SBA develop and implement portfolio-level data analytics across
EIDL program loans and advances made in response to COVID-19 as a means to detect potentially
ineligible and fraudulent applications. Although implementing this recommendation would
help SBA further detect potential fraud after it occurs, conducting a comprehensive fraud risk
assessment in alignment with leading practices, and using the resulting fraud risk proﬁle to
develop an antifraud strategy, would help SBA take a more strategic approach to managing
fraud risks to the EIDL program. Such an approach could (1) more eﬀectively safeguard billions
of dollars of taxpayer funds, and (2) better ensure that SBA addresses the full portfolio of risks
and strategically targets the most signiﬁcant fraud risks facing the program as part of ongoing
approvals for EIDL loans and targeted advances.
Identifying and managing risk in the EIDL program. As discussed above, we and others
have identiﬁed gaps in controls that may have led to fraud and the provision of EIDL funding
to ineligible entities. Federal internal control standards call for agency management oﬃcials to
assess the internal and external risks their entities face as they seek to achieve their objectives.
Management identiﬁes risks throughout the entity to provide a basis for analyzing risks. Risk
assessment is the identiﬁcation and analysis of risks related to achieving the deﬁned objectives to
form a basis for designing risk responses.
SBA program oﬃces are responsible for assessing controls and mitigating risks. However,
SBA’s Oﬃce of Disaster Assistance, which administers the EIDL program, has not proactively
assessed risks to the program. SBA oﬃcials from the Oﬃce of Disaster Assistance’s Processing and
Disbursement Center, which reviews and processes loan applications, told us that SBA does not
have documented risk assessments and that SBA has primarily identiﬁed problems through loan
oﬃcer review of loan applications.
The lack of a comprehensive plan to proactively assess controls and mitigate risks in the EIDL
program may hinder SBA from achieving the deﬁned objectives of the program and identifying
opportunities for improving preventive controls in a timely manner. For example, Processing
and Disbursement Center oﬃcials told us that 4 months after SBA started using the service
466Synthetic identity fraud is a crime in which perpetrators combine real or ﬁctitious information, such as Social Security
numbers and names, to create identities with which they may defraud ﬁnancial institutions, government agencies, or
individuals.
Page 303
GAO-21-387

organization’s automated validation system to approve loan applications in batches, they
realized that these applications contained alerts that should have been reviewed by loan oﬃcers.
Additionally, some validation changes have not been systematically incorporated using the service
organization’s automated system. For example, Processing and Disbursement Center oﬃcials told
us that loan oﬃcers were instructed to closely scrutinize applications from agricultural enterprises
and banks with only an online presence. However, SBA did not request automated alerts for
agricultural enterprises or online banks as part of the automated system checks, which could have
facilitated loan oﬃcers’ review. While the reference guide loan oﬃcers use as part of loan review
instructs loan oﬃcers to review applications from agricultural enterprises, the reference guide did
not contain similar instructions for online banks.
Agency Comments
We provided SBA, the Department of the Treasury (Treasury), and the Oﬃce of Management
and Budget (OMB) with a draft of this enclosure. SBA provided technical comments that we
incorporated as appropriate. OMB and Treasury did not provide comments on this enclosure.
In its comments, reproduced in appendix X , SBA agreed with all three recommendations. With
respect to the two recommendations addressing fraud risk management, SBA noted that it would
work to determine the appropriate resources and approach to implement the recommendations
to ensure that a fraud risk assessment for EIDL is completed and that fraud risk is monitored
on a continuous basis. In its technical comments, SBA asked us to make the recommendations
solely to the SBA Administrator so that SBA could determine the best resources to implement
the recommendations. Therefore, we revised our recommendations to direct them to the SBA
Administrator to provide additional ﬂexibility to SBA regarding who should conduct the fraud risk
assessment and monitor fraud risks in the program and who should implement a comprehensive
oversight plan.
Methodology
To conduct this work, we reviewed SBA documentation on implementation of targeted advances.
Additionally, we interviewed oﬃcials from SBA, SBA OIG, and the Federal Bureau of Investigation.
We monitored SBA’s ﬁscal year 2020 ﬁnancial statement audit and reviewed its ﬁscal year 2020
agency ﬁnancial report and the accompanying independent auditor’s report. We analyzed SBA’s
summary data on the processing of loan applications and assessed the reliability of these data by
interviewing SBA oﬃcials. We determined that the data were suﬃciently reliable for reporting on
the number and dollar amount of EIDL loans and processing times.
Contact information: William B. Shear, (202) 512-8678, shearw@gao.gov
Related GAO Products
High-Risk Series: Dedicated Leadership Needed to Address Limited Progress in Most High-Risk Areas.
GAO-21-119SP. Washington, D.C.: March 2, 2021.
Page 304
GAO-21-387

A Framework for Managing Fraud Risks in Federal Programs. GAO-15-593SP. Washington, D.C.: July 28,
2015.
Standards for Internal Control in the Federal Government. GAO-14-704G. Washington, D.C.:
September 10, 2014.
Page 305
GAO-21-387

Paycheck Protection Program
The Small Business Administration has begun making new Paycheck Protection Program loans
and has implemented changes to its processes, but needs to address control and accounting
deﬁciencies and has not adequately assessed the risk of fraud in the program.
Entities involved: Small Business Administration, Department of the Treasury
Recommendations for Executive Action
We are making the following two recommendations to the Small Business Administration:
The Administrator of the Small Business Administration should conduct and document a fraud risk
assessment for the Paycheck Protection Program. SBA agreed with our recommendation.
The Administrator of the Small Business Administration should develop a strategy that outlines
speciﬁc actions to monitor and manage fraud risks in the Paycheck Protection Program on a
continuous basis. SBA agreed with our recommendation.
Key Considerations and Future GAO Work
In June 2020, we recommended that the Small Business Administration (SBA) develop and
implement plans to identify and respond to risks in the Paycheck Protection Program (PPP) to
ensure program integrity, achieve program eﬀectiveness, and address potential fraud, including
in loans of $2 million or less. SBA neither agreed nor disagreed with our recommendation at
that time. Consistent with our recommendation, in December 2020, SBA oﬃcials said the agency
had completed oversight plans. In response to our request that SBA provide the policies and
procedures detailing these plans, the agency provided a Loan Review Plan for the loan review
process. Although the plan references detailed policies and procedures for some loan reviews
and loan forgiveness reviews, they were not included in the document we received because these
policies and procedures were being updated according to SBA oﬃcials. In February 2021, SBA
provided all but one of the documents referenced in the plan and stated that it was still ﬁnalizing
the last document. The documents SBA provided include additional details on how SBA and its
contractors plan to conduct the various reviews. We continue to review these documents to
determine the extent to which they address our recommendation.
In November 2020, we also recommended that SBA expeditiously estimate improper payments
and report estimates and error rates for PPP due to concerns about the possibility that improper
payments, including those resulting from fraudulent activity, could be widespread. SBA neither
agreed nor disagreed with our recommendation at that time. In response to our recommendation,
SBA stated that it was planning to conduct improper payment testing for PPP and that it takes
improper payments seriously. SBA oﬃcials stated that SBA has submitted the sampling plan
for this testing to the Oﬃce of Management and Budget (OMB) and will use this sampling plan
to estimate both improper payments and error rates for PPP. We will continue to monitor the
agency's actions to address this recommendation.
Page 306
GAO-21-387

In December 2020, SBA’s independent ﬁnancial statement auditor issued a disclaimer of opinion
on SBA’s consolidated ﬁnancial statements as of and for the year that ended September 30,
2020, meaning the auditor was unable to express an opinion due to insuﬃcient evidence.467 As
part of the basis for the disclaimer, the auditor stated that SBA was unable to provide adequate
documentation to support a signiﬁcant number of transactions and account balances related to
PPP due to inadequate processes and controls. The auditor identiﬁed four material weaknesses
and made 17 recommendations to address controls related to accounting and reporting for PPP
and evaluation and monitoring of service organization (contractor) controls.468 In addition, the
auditor identiﬁed one material weakness and made ﬁve recommendations to address entity-level
controls that aﬀect the operation of PPP. SBA did not fully agree with the weaknesses and neither
agreed nor disagreed with the recommendations.
In March 2021, we added Emergency Loans for Small Businesses, which includes PPP, as a new
area in our High-Risk List because of the limited controls built into the PPP approval process, the
related risk of hundreds of millions of dollars in improper payments, and the consequent need for
greater program integrity and better management. These risks are exacerbated by SBA’s inability
to support its accounting and related control deﬁciencies.
Our work on PPP is ongoing. We continue to examine the characteristics of borrowers that
received PPP loans, the safeguards SBA implemented to help ensure that lenders and borrowers
complied with program requirements, and the loan forgiveness process. We also continue to
monitor SBA’s progress toward developing and implementing corrective actions to address the
material weaknesses identiﬁed by its ﬁnancial statement auditor.
Background
Since March 2020, Congress has provided commitment authority of about $814 billion for PPP
(including lender fees) under SBA’s largest guaranteed loan program, its 7(a) small business
lending program.469 PPP loans, made by lenders but guaranteed 100 percent by SBA, are low
interest (1 percent) and fully forgivable if certain conditions are met.470
467Small Business Administration, Oﬃce of Performance Management and the Chief Financial Oﬃcer, Agency Financial
Report Fiscal Year 2020 (Washington, D.C.: Dec. 18, 2020), 39–63.
468A material weakness is a deﬁciency, or combination of deﬁciencies, in internal control over ﬁnancial reporting,
such that there is a reasonable possibility that a material misstatement of the entity’s ﬁnancial statements will not
be prevented, or detected and corrected, on a timely basis. A deﬁciency in internal control exists when the design or
operation of a control does not allow management or employees, in the normal course of performing their assigned
functions, to prevent, or detect and correct, misstatements on a timely basis.
469 See Pub. L. No. 116-136, §§ 1102(b), 1107(a)(1), 1112, 134 Stat. 281, 293, 301; Pub. L. No. 116-139, § 101(a), 134 Stat.
620, 620 (2020); Pub. L No. 116-260, div. N, tit. III, §323 134 Stat. 1182, 2018-22 (2020); Pub. L. No. 117-2, § 5001(d) 135
Stat. 4, 85 (2021).
470As originally implemented by SBA, at least 75 percent of the loan forgiveness amount must have been for payroll
costs. In addition, the CARES Act required loans to be used within an 8-week period in order for the loans to be fully
forgiven. However, the Paycheck Protection Program Flexibility Act of 2020 modiﬁed this to at least 60 percent and
allowed borrowers to pay or incur those expenses over a 24-week period. Pub. L. No. 116-142, § 3, 134 Stat. 641, 641-42
(2020). Under the Paycheck Protection Program Flexibility Act of 2020, the covered period for PPP loans was to end the
earlier of 24 weeks after origination or December 31, 2020. The Consolidated Appropriations Act, 2021, further modiﬁed
Page 307
GAO-21-387

According to SBA, as of February 21, 2021, lenders had made about 7.1 million PPP loans totaling
about $663 billion. The majority of these loans (about 5.3 million loans totaling more than $521
billion according to SBA) were made during the initial phase of PPP, which ended August 8,
2020.471 SBA relaunched the program (Round 2) on January 11, 2021, following enactment of the
Consolidated Appropriations Act, 2021, which authorized additional PPP loans and made changes
to the program. Among other things, the act expanded the list of allowable uses of proceeds and
loan forgiveness and allowed PPP borrowers to receive a second PPP loan of up to $2 million
provided that they meet certain criteria.472
In addition, the act simpliﬁed the loan forgiveness application process for loans of $150,000 or
less.473 In response to this legislation, SBA issued updated forms and guidance in January 2021. As
of February 18, 2021, SBA had approved about 1.7 million loan forgiveness applications (about 32
percent of all loans) totaling about $152 billion, according to SBA.
In March 2021, the American Rescue Plan Act of 2021 appropriated an additional $7.3 billion for
the program.
As of January 31, 2021, SBA had obligated about $603 billion across the two rounds of PPP,
including lender fees, and expended about $530 billion, according to SBA.
Overview of Key Issues
Round 2 launched with more up-front controls. SBA made a number of changes to PPP as it
implemented Round 2 of the program.
• Priority for underserved small businesses. When SBA relaunched the program on January
11, 2021, it initially prioritized community ﬁnancial institutions that specialize in serving
underserved communities, including minority-, women- and veteran-owned small
the covered period to allow the borrower to choose a covered period ending any date between 8 and 24 weeks after
origination. Pub. L. No. 116-260, div. N, tit. III, § 306, 134 Stat. 1182, 1997 (2020).
471Totals exclude canceled loans. According to SBA, canceled loans may include, but are not limited to, duplicative
loans, loans not closed for any reason, and loans that were fully paid oﬀ. In our September 2020 report, we provided
information on the types of borrowers that received PPP loans and the size of PPP loans.
472The Consolidated Appropriations Act, 2021, expanded the list of allowable uses of proceeds and loan forgiveness to
include certain operations, property damage, supplier, and worker protection expenditures. PPP borrowers are eligible
to receive a second PPP loan of up to $2 million provided that they meet certain criteria, such as having not more than
300 employees, having used or intending to use the full amount of their initial PPP loan, and documenting quarterly
revenue losses of at least 25 percent in a quarter of 2020 when compared to the same quarter in 2019. Pub. L No.
116-260, div. N, tit. III, § 311, 134 Stat. 1182, 2001 (2020); see also 86 Fed. Reg. 3712 (Jan. 14, 2021).
473Under the Consolidated Appropriations Act, 2021, the loan forgiveness certiﬁcation was required to be not more than
one page in length and could only require borrowers to provide a description of the number of employees they were
able to retain because of the loan, the estimated amount of the loan amount spent on payroll costs, and the total loan
value. Borrowers must also attest that they complied with all PPP loan requirements. Borrowers must retain relevant
employment records for 4 years following submission of the form and other relevant records for 3 years. SBA retains the
right to review and audit these loans for fraud.
Page 308
GAO-21-387

businesses.474 SBA opened the application portal to smaller lenders on January 15, 2021.475
According to SBA, SBA approved about 60,000 loan applications for more than $5 billion during
this initial access period. SBA opened PPP to all participating lenders on January 19, 2021.
On February 22, 2021, the White House announced additional eﬀorts to target PPP to the
smallest businesses. For example, it instituted a 14-day period, starting February 24, 2021,
during which only businesses with fewer than 20 employees could apply. In addition, the White
House said it would revise the loan calculation formula for sole proprietors, independent
contractors, and self-employed individuals to oﬀer more relief and establish a $1 billion set-
aside for these types of businesses without employees located in low- and moderate-income
areas.
• Second draw loans available. The Consolidated Appropriations Act, 2021, allowed eligible small
businesses to get a second PPP loan.476 According to SBA, as of February 21, 2021, about 1.3
million of the total loans made during Round 2 (or about 69 percent) were second draw loans.
• Additional up-front controls. Unlike the initial round of PPP, in which SBA did not conduct any
review of loan or borrower information prior to issuing a loan number, SBA is implementing
front-end compliance checks of loan and borrower information prior to the loans being
approved and closed by the lender. According to SBA oﬃcials and documentation, these
reviews include comparisons of the loan applications against the Department of the Treasury’s
Do Not Pay service and public records.477 Among other things, these validation eﬀorts include
items such as determining whether the business was in operation as of February 15, 2020.
SBA oversight plans still being documented . As we have previously reported, SBA plans to
review all PPP loans of $2 million or more and further stated that it may review any PPP loan it
deems appropriate, including loans of less than $2 million. According to the Loan Review Plan SBA
provided us, SBA’s oversight of PPP loans involves three types of reviews: an automated screening
of all loans at both the individual loan and aggregate levels, a manual review of selected loans, and
a quality control review of a sample of loans. As shown in the table below, most of the loan reviews
are conducted by contractors with SBA oversight.
474The Consolidated Appropriations Act, 2021, set aside $15 billion for initial and second draw PPP loans issued by
community ﬁnancial institutions, including community development ﬁnancial institutions and minority depository
institutions, and an additional $15 billion for initial and second draw PPP loans issued by certain small depository
institutions. Pub. L. No. 116-260, div. N, tit. III, § 323(d)(1)(A), 134 Stat. 1182, 2019-20 (2020).
475SBA considered smaller lenders to be those with $1 billion or less in assets.
476Eligible entities include businesses, certain nonproﬁt organizations, housing cooperatives, veterans’
organizations, tribal businesses, self-employed individuals, sole proprietors, independent contractors, and small
agricultural co-operatives that received a PPP loan, employ not more than 300 employees, and meet certain other
criteria. See Pub. L. No. 116-260, div. N, tit. III, § 311, 134 Stat. 1182, 2001 (2020); see also 86 Fed. Reg. 3712 (Jan. 14,
2021).
477The Department of the Treasury’s Do Not Pay service is an analytics tool that helps federal agencies detect and
prevent improper payments made to vendors, grantees, loan recipients, and beneﬁciaries. Agencies can check
multiple data sources in order to make payment eligibility decisions.
Page 309
GAO-21-387

Small Business Administration (SBA) and Contractor Reviews of Paycheck Protection Program Loans
Description
Contractor role
SBA role
Status
as of
February
2021
Automated screenings
Individual loan level
All loans individually screened to identify
certain anomalies and attributes that may
indicate noncompliance with select eligibility
requirements, fraud, or abuse.
Use proprietary automated
tool to compare Paycheck
Protection Program (PPP) loan
data against publicly available
information and apply eligibility
and fraud detection rules.
Front-end system design.
Ongoing
Aggregated loan level
Following completion of a critical mass of
individual loan screenings and manual loan
reviews, all loans screened in the aggregate
to identify and analyze relationships across
loans, borrowers, and lenders to identify
potentially suspicious relationships and
activities.
Use proprietary, rules-based
engine to analyze PPP loan
portfolio.
Front-end system design.
Not yet
started
Manual reviews
Required
Reviews of all loans of $2 million or greater for
• eligibility, including loan necessity;
• fraud or abuse; and
• compliance with loan forgiveness rules
when loan forgiveness decision is
submitted.
Review loan data, conduct
research, and request
documentation from lenders,
borrowers, or both as needed
to determine compliance
with eligibility requirements
(including loan necessity) or
indication of potential fraud or
abuse.
Review all contractor
reports, including those
regarding loan necessity,
and review all loan
forgiveness applications.
Ongoing
Discretionary
Reviews of loans of less than $2 million that
are identiﬁed by the automated screening
process or separately ﬂagged for manual
review for
• eligibility, excluding loan necessity;
• fraud or abuse; and
• compliance with loan forgiveness rules
when loan forgiveness decision is
submitted.
Review loan forgiveness
decisions using automated tool
and manually if necessary.
Review all contractor
reports for loans where
contractor recommended
further action. Conduct
quality assurance review of
statistically valid sample of
loans where the contractor
recommends no further
action.
Ongoing
Page 310
GAO-21-387

Description
Contractor role
SBA role
Status
as of
February
2021
Quality control reviews
Quality control reviews of a sample of loan
review ﬁles to ensure that all steps of the loan
review process as documented by SBA were
completed and that the evidence in the loan
review ﬁle is suﬃcient to support the decision.
Review sample of loan review
ﬁles.
Front-end process design.
Just
starteda
Source: GAO analysis of SBA documents. | GAO-21-387
aAccording to SBA oﬃcials, the contractor began conducting quality control reviews in early February 2021.
The Loan Review Plan references detailed policies and procedures for loan reviews and loan
forgiveness reviews. In February 2021, SBA provided seven of the eight documents referenced
in the plan and stated that it was still ﬁnalizing the last document. The documents SBA provided
include additional details on how SBA and its contractors plan to conduct the various reviews, at
least for those loans approved in 2020.478
Inability to support PPP accounting and related controls. In December 2020, SBA’s
independent ﬁnancial statement auditor issued a disclaimer of opinion on SBA’s ﬁscal year 2020
consolidated ﬁnancial statements, meaning the auditor was unable to express an opinion due to
insuﬃcient evidence. As the basis for the disclaimer, the auditor reported that SBA was unable
to provide adequate documentation to support a signiﬁcant number of transactions and account
balances due to inadequate processes and controls related to its implementation of its programs
authorized under the CARES Act and related legislation—speciﬁcally PPP and the Economic Injury
Disaster Loan (EIDL) program.479 For more information on the auditor’s ﬁndings related to the
Economic Injury Disaster Loan program, see the Economic Injury Disaster Loan Program enclosure
in appendix I.
The auditor identiﬁed four material weaknesses in internal controls related to PPP concerning loan
approvals, reporting, cost estimates, and oversight of service organizations integral to the servicing
and reporting of SBA’s loan guarantee programs, including PPP. In its discussion of these material
weaknesses, the auditor noted there were over 2 million approved PPP loans (with an approximate
total value of $189 billion) ﬂagged by management that were potentially not in conformance with
478According to the documents and SBA oﬃcials, SBA is in the process of updating its review policies to reﬂect changes
made in implementing the Consolidated Appropriations Act, 2021.
479The Economic Injury Disaster Loan program provides low-interest loans of up to $2 million for expenses—such as
operating expenses—that cannot be met because of a disaster. The CARES Act expanded EIDL program eligibility to
include additional small business entities and appropriated $10 billion to create a program to provide small businesses
up to $10,000 in advances toward payroll, sick leave, and other business obligations. In the Paycheck Protection
Program and Health Care Enhancement Act, Congress appropriated another $10 billion for advances. The Consolidated
Appropriations Act, 2021, included an additional $20 billion for targeted EIDL advances to eligible entities with 300 or
fewer employees in low-income communities that have suﬀered an economic loss of greater than 30 percent.
Page 311
GAO-21-387

the CARES Act and related legislation. The loans were ﬂagged for one or more of 35 reasons (such
as borrower with criminal record or inactive business).
In addition, the auditor found that SBA management did not have processes and controls in place
to review the status of PPP loan guarantees and as a result reported approximately $6 billion of
PPP loans that were approved but not disbursed due to unsubmitted or unprocessed reports
from lenders. The auditor noted there were over 896,000 errors from lender reporting that were
identiﬁed but not reviewed or processed by SBA. The auditor also found that SBA did not consider
and document the eﬀects of the $189 billion in ﬂagged PPP loans or the errors from lender
reporting on the PPP reestimate methodology. The auditor also reported that SBA did not conduct
or properly document suﬃcient evaluations of internal control reports for service organizations
integral to SBA’s loan guarantee programs, including PPP.
In total, the auditor made 17 recommendations to SBA to address these four material weaknesses
related to PPP. Among other things, the auditor recommended that SBA
• ﬁnalize its review plan and execute the loan review process for PPP;
• implement adequate controls to prevent loans from being approved that are potentially not in
conformance with legislative requirements and program terms;
• review PPP loans with incomplete or inaccurate reporting and update records as appropriate;
• enhance its review and evaluation of service organization controls; and
• assess the accounting considerations and record any necessary adjustments for PPP loans
determined to be not in conformance with the CARES Act and related legislation.
SBA’s ﬁnancial statement auditor reported that deﬁciencies related to the majority of the
identiﬁed material weaknesses related to PPP were caused by an inadequate entity-level control
environment at SBA—the agency’s overall management controls to establish an eﬀective internal
control system.480 Speciﬁcally, the auditor reported a material weakness in SBA’s entity-level
controls, citing that SBA management did not properly design and implement overall eﬀective
management controls to account for new and expanded programs under the CARES Act and
related legislation. The auditor issued ﬁve recommendations to improve entity-level controls,
including recommending, among other things, that SBA hold accountable individuals responsible
for overseeing management’s design, implementation, and operation of SBA’s internal control
system; develop and implement monitoring controls; and document the internal controls related
to implementation of the CARES Act and related legislation.
480GAO’s Standards for Internal Control in the Federal Government provides the overall framework for establishing and
maintaining an eﬀective internal control system, and it lists ﬁve components of internal control representing the highest
level of the hierarchy of standards for internal control in the federal government. The ﬁve components of internal
control are (1) control environment, (2) risk assessment, (3) control activities, (4) information and communication, and
(5) monitoring. The ﬁve components of internal control must be eﬀectively designed, implemented, and operating, and
operating together in an integrated manner, for an internal control system to be eﬀective.
Page 312
GAO-21-387

The auditor noted that the deﬁciencies were primarily caused by SBA prioritizing the
implementation of CARES Act provisions and related legislation as quickly and eﬃciently as
possible over designing and implementing eﬀective internal control processes. In the case of
PPP, the auditor found that SBA was faced with implementing a new program with the inherent
challenges of not having historical precedent, evolving and complex guidance, inadequate
systems for a program of such a large scale, and an insuﬃcient number of personnel to assist
with implementing the related statutory provisions. SBA’s ﬁscal year 2020 agency ﬁnancial
report describes the unprecedented scale of this eﬀort. For example, the report states that
SBA processed 14 years’ worth of loans in the ﬁrst 14 days of PPP, and ultimately guaranteed
5.2 million PPP loans totaling $525 billion in ﬁscal year 2020. As a result, SBA’s reported liability
for loan guarantees increased from $2 billion as of September 30, 2019, to $512.7 billion as of
September 30, 2020, reﬂecting this dramatic increase in activity.
SBA disagreed with the material weaknesses related to PPP loan approvals, reporting, and
cost estimates, as well as entity-level controls; partially agreed with the material weakness
related to service organization oversight; and neither agreed nor disagreed with the related
recommendations. However, SBA did recognize that documentation of the processes and controls
was not suﬃciently detailed to support the ﬁnancial statement audit and stated that it is working
diligently to correct any shortcomings for future audits. We support the recommendations the
auditor provided to address control weaknesses related to PPP, and we encourage SBA to continue
to work to improve its controls over the program, as well as to improve its documentation to
support future ﬁnancial statement audits.
Ongoing concerns about fraud risk management. The Department of Justice (DOJ) and law
enforcement agencies have reported ongoing eﬀorts related to potential fraud in PPP.481 From
May 2020 to February 2021, DOJ publicly announced charges in over 100 fraud-related cases
associated with PPP loans, charging at least 170 defendants. The charges—ﬁled in federal courts
across the U.S. and investigated by a range of law enforcement agencies—include allegations
of making false statements and engaging in identity theft, wire and bank fraud, and money
laundering, among other charges. As of February 2021, over 30 defendants had pleaded guilty
to federal charges of defrauding PPP. For more information related to these guilty pleas, see the
Federal Fraud-Related Cases enclosure in appendix I.
In addition to ongoing prosecutions, law enforcement oﬃcials we spoke with noted a large
number of ongoing investigations and hotline complaints related to CARES Act loans, including
loans made under PPP and the EIDL program. A senior oﬃcial with SBA’s Oﬃce of Inspector
General (OIG) told us that, as of January 2021, the OIG had opened over 260 investigations related
to CARES Act loans, at least three times the number of investigations the oﬃce would typically
open in a year.482 Similarly, the SBA OIG reported receiving over 70,000 hotline complaints related
to CARES Act programs, compared to the 700 to 800 it would receive in a typical year.
Law enforcement oﬃcials also reported systemic patterns of fraud across PPP investigations.
Oﬃcials at SBA OIG and the Federal Bureau of Investigation (FBI) told us that they have identiﬁed
481We reported on the potential for fraud in PPP in October 2020.
482SBA oﬃcials noted that the number of PPP loans made also was signiﬁcantly higher than the number made in a
typical year.
Page 313
GAO-21-387

systemic patterns of potential fraud including identity theft, false attestations on loan documents,
ﬁctitious and inﬂated employee counts, falsiﬁed tax documentation, and misuse of proceeds.
Additionally, the FBI reported in June 2020 that early investigations of PPP-related fraud involved
bank insiders, previously convicted felons, the use of dormant or cash businesses, and identity
theft. Similarly, we reported in January 2021 that we analyzed aggregate data on suspicious activity
reports ﬁled by ﬁnancial institutions from April to October 2020. These reports identiﬁed multiple
types of potentially suspicious activity related to PPP, such as indicators of identity theft, the rapid
movement of funds, and forgeries.
SBA has taken some steps to mitigate fraud risks to PPP. According to SBA oﬃcials, they conducted
an informal fraud risk assessment for PPP that resulted in reviews and addition of some upfront
controls, as discussed above. For example, SBA brought together subject matter experts from SBA
and the Department of the Treasury (Treasury), as well as contractors, to identify fraud risks and
mitigating controls for the program. To identify fraud risks, SBA used information on vulnerabilities
observed through existing loan reviews as well as information from external sources, such as SBA
OIG reports.
Leading practices identiﬁed in GAO’s Fraud Risk Framework call for a strategic approach for
assessing and managing fraud risks.483 The Fraud Risk Framework notes that such an approach
includes designating an entity to lead fraud risk management activities. According to SBA oﬃcials,
the agency created the Fraud Risk Management Council, which has a direct reporting authority
to SBA’s Administrator, and its associated Enterprise Risk Management Board to oversee and
coordinate agency-wide management of fraud risk. In alignment with leading practices in the
Fraud Risk Framework, this council has a direct reporting line to senior-level managers at SBA and
is not located within the OIG. However, it is unclear at this time whether the council meets the
leading practices as a dedicated antifraud entity, including (1) understanding the program and its
operations, as well as the fraud risks and controls throughout the program, and (2) having deﬁned
responsibilities and the necessary authority across the program.
According to the Fraud Risk Framework, the dedicated antifraud entity should, among other
activities, manage the fraud risk assessment process and coordinate antifraud initiatives across
the program. The fraud risk assessment should (1) identify inherent fraud risks facing the program,
(2) assess the likelihood and impact of inherent fraud risks facing the program, (3) determine fraud
risk tolerance, (4) examine the suitability of existing fraud controls and prioritize residual fraud
risks, and (5) document the program’s fraud risk proﬁle.484 Such an assessment helps program
managers determine whether they have the right controls in place to combat the most likely and
impactful risks facing the program. The fraud risk assessment is particularly informative when the
volume and nature of fraud risk indicators signify an evolving fraud risk landscape, as conﬁrmed
by law enforcement oﬃcials for PPP-related fraud. Further, the risk proﬁle serves as the basis
for the antifraud strategy, which deﬁnes key elements, such as responsibilities, activities, and
483The Fraud Risk Framework helps managers meet their responsibilities to assess and manage fraud risks as required
by federal internal control standards.
484According to federal internal control standards, inherent risk is the risk to an entity prior to considering
management’s response to the risk. Residual risk is the risk that remains after management’s response to inherent risk.
A fraud risk proﬁle documents the ﬁndings from a fraud risk assessment, including the analysis of the types of fraud
risks, their perceived likelihood and impact, risk tolerance, and the prioritization of risks.
Page 314
GAO-21-387

timelines for addressing residual risks and continuously identifying emerging fraud risks to the
program.
Although SBA has taken steps to identify and address fraud risks on a loan-level basis through
an informal fraud risk assessment process, it has not conducted a comprehensive fraud risk
assessment in alignment with leading practices, nor documented its antifraud strategy outlining
a strategic approach to managing fraud risks to PPP. According to SBA oﬃcials, given the rapid
response required to execute the program, they conducted an informal fraud risk assessment. In
February 2021, SBA oﬃcials told us the agency would complete a formal fraud risk assessment but
did not provide a ﬁrm date for when they would complete such an assessment.
While SBA’s initial steps are important, a comprehensive assessment that considers the likelihood
and impact of all inherent fraud risks, the suitability of existing controls, risk tolerance, and
prioritization of residual risk is key to ensuring resources are appropriately allocated to the most
pressing risks. Further, an antifraud strategy would help ensure that SBA takes a strategic, risk-
based approach to prevent, detect, and respond to fraud risks. In addition to preventive controls,
a fraud risk management strategy would help SBA continuously detect and respond to risks after
loans are made.
In June 2020 and November 2020, respectively, we recommended that SBA (1) develop and
implement plans to identify and respond to risks in the PPP to ensure program integrity, achieve
program eﬀectiveness, and address potential fraud, including in loans of $2 million or less, and (2)
expeditiously estimate improper payments and report estimates and error rates for PPP due to
concerns about the possibility of improper payments, including those resulting from fraudulent
activity. Although these recommendations note fraud risks, they are aimed at enhancing program
integrity and estimating improper payments, activities that are broader than managing fraud risks.
Implementing those recommendations may include establishing or enhancing diﬀerent controls
than those needed to address fraud risks. Addressing fraud risks eﬀectively necessitates a fraud
risk assessment.
We recognize the importance of providing timely emergency loan assistance to small businesses.
Conducting a fraud risk assessment need not hinder program delivery and can in fact facilitate
program goals by ensuring that taxpayer dollars and government services serve their intended
purposes. Further, SBA has existing resources it can leverage in such an eﬀort; for example, it
could build on the informal fraud risk assessment and leverage existing resources provided by the
Oﬃce of Continuous Operations and Risk Management. This oﬃce can provide leadership and
resources informed by its enterprise risk management eﬀorts as well as insight into fraud risks
across SBA’s loan portfolios.
Conducting a comprehensive fraud risk assessment in alignment with leading practices, and
using the resulting fraud risk proﬁle to develop an antifraud strategy, would help SBA take a more
strategic approach to managing fraud risks to PPP. Such an approach could (1) more eﬀectively
safeguard billions of dollars of taxpayer funds and (2) better ensure that SBA addresses the full
portfolio of risks and strategically targets the most signiﬁcant fraud risks facing the program as
part of ongoing PPP approvals and forgiveness.
Page 315
GAO-21-387

Agency Comments
We provided SBA, Treasury, and OMB with a draft of this enclosure. SBA provided comments in a
letter, which is reproduced in appendix X . In its letter, SBA agreed with the recommendations and
noted that it would work to determine the appropriate resources and approach to implement the
recommendations to ensure that a fraud risk assessment for PPP is completed and that fraud risk
is monitored on a continuous basis. SBA also provided technical comments that we incorporated
as appropriate. In its technical comments, SBA asked us to direct the recommendations solely
to the SBA Administrator so that SBA could determine the best resources to implement the
recommendation. Therefore, we revised the two recommendations to direct them to the SBA
Administrator to provide additional ﬂexibility to SBA regarding who should conduct the fraud risk
assessment and monitor fraud risks in the program.
Treasury provided technical comments that we incorporated as appropriate. OMB did not have
any comments on this enclosure.
Methodology
To conduct this work, we reviewed SBA documentation and data on PPP loan approvals, loan
forgiveness applications, and obligations and expenditures. We monitored SBA’s ﬁscal year
2020 ﬁnancial statement audit and reviewed its ﬁscal year 2020 agency ﬁnancial report and the
accompanying independent auditor’s report. We interviewed oﬃcials from FBI, SBA, and the SBA
OIG, and representatives of the three contractors involved in the loan review process. We assessed
the reliability of the SBA data by interviewing SBA oﬃcials. We determined that the data were
suﬃciently reliable for reporting the number and dollar amount of PPP loans, the status of loan
forgiveness applications, and the status of PPP expenditures.
Contact information: William B. Shear, (202) 512-8678, shearw@gao.gov
Related GAO Products
High-Risk Series: Dedicated Leadership Needed to Address Limited Progress in Most High-Risk Areas.
GAO-21-119SP. Washington, D.C.: March 2, 2021.
Small Business Administration: COVID-19 Loans Lack Controls and Are Susceptible to Fraud.
GAO-21-117T. Washington, D.C.: October 1, 2020.
A Framework for Managing Fraud Risks in Federal Programs. GAO-15-593SP. Washington, D.C.: July
28, 2015.
Standards for Internal Control in the Federal Government. GAO-14-704G. Washington, D.C.:
September 10, 2014.
Page 316
GAO-21-387

Federal Reserve Lending Facilities
The CARES Act-supported lending programs (facilities) stopped purchasing assets or extending
credit at the end of 2020, except for the Main Street lending facilities, which ended on January
8, 2021. Overall, the transaction volume and purchases of assets by the CARES Act-supported
facilities totaled approximately $41 billion (or a little more than 2 percent) of their $1.95 trillion
capacity. The Consolidated Appropriations Act, 2021, rescinded most of the CARES Act funding and
generally prohibited the Department of the Treasury’s funding support for future facilities that
would be the same as those implemented pursuant to Title IV of the CARES Act. Federal Reserve
and Department of the Treasury oﬃcials told us they continue to monitor market conditions to
assess the need for implementing new facilities.
Entities involved: Department of the Treasury, Federal Reserve System
Key Considerations and Future GAO Work
In July 2011, we made two recommendations regarding facilities that the Board of Governors of
the Federal Reserve System (Federal Reserve) established in response to the 2007–2009 ﬁnancial
crisis. These two recommendations are for the Federal Reserve to (1) strengthen procedures
related to high-risk borrowers and (2) estimate and track losses within and across all facilities.
These recommendations are relevant because the Federal Reserve created similar facilities that
were supported by CARES Act funds to respond to COVID-19.
In our December 2020 report on the Federal Reserve’s facilities and relevant market trends, we
reported that the Federal Reserve took action to address the intent of the ﬁrst recommendation
and, therefore, we closed this recommendation in January 2021. We will continue to examine the
status of the Federal Reserve’s actions in addressing our second recommendation.485
Background
The CARES Act appropriated $500 billion to the Department of the Treasury (Treasury) and
authorized at least $454 billion of that total for Treasury to support the Federal Reserve in
establishing programs—known as facilities—for the purpose of providing liquidity to the ﬁnancial
system that supports lending to states, tribes, municipalities, eligible businesses, and nonproﬁt
organizations.486 Of the $454 billion, Treasury committed $195 billion and, of that amount,
disbursed $102.5 billion to support the facilities. The Federal Reserve also established four
facilities that do not receive CARES Act-appropriated funds; these facilities aim to provide liquidity
to the ﬁnancial sector and businesses.
485The Federal Reserve has taken some actions to address the second recommendation, such as conducting scenario-
based analyses for the facilities established in 2020 to assess the extent of possible losses in a range of scenarios.
However, some documentation needed for a full assessment of the agency’s actions was not available at the time of our
reporting.
486The facilities were authorized under Section 13(3) of the Federal Reserve Act, which permits the Federal Reserve to
provide emergency lending, and were approved by the Secretary of the Treasury. Section 13(3) facilities must comply
with requirements relating to loan collateralization and taxpayer protection, among others.
Page 317
GAO-21-387

Overview of Key Issues
The Consolidated Appropriations Act, 2021, rescinded most of Treasury’s CARES Act funding and
prohibited Treasury from funding future facilities that would be the same as those implemented
under the CARES Act, except for the Term Asset-Backed Securities Loan Facility.487 Additionally,
in December 2020, the agreements governing the CARES Act facilities between Treasury and the
Federal Reserve were amended to be consistent with the Consolidated Appropriations Act, 2021.
The amendments included items such as cancelling commitments to make additional investments
and adjusting Treasury’s contributed amounts, to be consistent with the act.
The transaction volume for the nine Federal Reserve lending facilities that received CARES
Act funding was generally limited, relative to their capacity. In addition, the four non-CARES
Act facilities, which the Federal Reserve and Treasury extended through March 31, 2021, have
generally had limited transaction volumes since mid-May 2020. On March 8, 2021, the Federal
Reserve and Treasury extended one of the non-CARES Act facilities—the Paycheck Protection
Program Liquidity Facility—through June 30, 2021.
CARES Act facilities . The Federal Reserve established nine facilities supported by CARES Act
funding:
• Primary Market Corporate Credit Facility and Secondary Market Corporate Credit
Facility. These two facilities were designed to support large businesses by purchasing
qualifying corporate bonds and other eligible assets.
• Main Street Lending Program. Under this program, a total of ﬁve facilities were designed to
support small and mid-sized for-proﬁt businesses and nonproﬁt organizations by purchasing
participations in eligible loans.488
• Municipal Liquidity Facility. This facility was designed to support states, certain counties,
municipalities, multistate entities, and revenue bond issuers by purchasing eligible notes that
these entities issued.
• Term Asset-Backed Securities Loan Facility. This facility was designed to support consumers
and businesses by providing nonrecourse loans to U.S. companies secured by qualifying asset-
backed securities generally backed by recently originated consumer and business loans.
The Federal Reserve determined that these facilities combined could hold a maximum of $1.95
trillion in assets when they were purchasing eligible assets and extending credit. The nine facilities
487The Consolidated Appropriations Act, 2021, rescinded at least $429 billion of the $500 billion previously appropriated
to Treasury under Title IV of the CARES Act. Certain funds appropriated out of the $500 billion were not rescinded,
including $25 million for the Special Inspector General for Pandemic Recovery, $5 million for the Congressional
Oversight Committee, and $100 million to pay costs and administrative expenses. Consolidated Appropriations Act,
2021, Pub. L. No. 116-260, div. N, tit. X, § 1003(a)(2)(C), 134 Stat. 1182, 2145 (2020).
488The Main Street Lending Program comprises ﬁve facilities: the Main Street New Loan Facility, Main Street
Priority Loan Facility, Main Street Expanded Loan Facility, Nonproﬁt Organization New Loan Facility, and Nonproﬁt
Organization Expanded Loan Facility.
Page 318
GAO-21-387

conducted about $41 billion in transactions—with the Main Street Lending Program accounting
for more than $16.5 billion. In its most recent periodic report to Congress on the lending facilities,
the Federal Reserve Board stated that it continued to expect that the facilities would not result in
losses to the Federal Reserve.489
Although demand for the CARES Act facilities was generally limited relative to their capacity, the
Main Street facilities experienced an increase in activity from mid-December through January 8,
2021. The Main Street facilities conducted a total of about $16.5 billion in transaction volume,
with just over $7.3 billion in transactions from December 16, 2020, through January 8, 2021. The
Municipal Liquidity Facility also conducted an additional $4.9 billion through two transactions in
the last half of December 2020, bringing its total transaction volume to almost $6.6 billion.490 See
ﬁgure for the CARES Act-supported facilities’ transaction volumes.
Cumulative Transaction Volume of Federal Reserve Lending Facilities Supported by CARES Act Funding, May
2020–January 2021
Note: The Primary Market Corporate Credit Facility, Secondary Market Corporate Credit Facility, Term Asset-Backed Securities
Loan Facility, and the Municipal Liquidity Facility ceased purchasing eligible assets or extending credit on December 31,
2020. The facilities in the Main Street Lending Program ceased purchasing participations in eligible loans on January 8, 2021.
Moreover, two of the CARES Act-supported facilities did not conduct any transactions—the Primary Market Corporate Credit
Facility and the Nonproﬁt Organization Expanded Loan Facility (a Main Street Lending Program facility).
Four of the CARES Act facilities stopped purchasing eligible assets or extending credit on
December 31, 2020, and the ﬁve Main Street facilities stopped purchasing participating interests
in loans that were still eligible on January 8, 2021. The Consolidated Appropriations Act, 2021,
rescinded most of the CARES Act-appropriated funding for supporting the facilities, including (1)
489The Federal Reserve’s expectation of the facilities incurring no losses for the agency takes into account Treasury’s
support using funds appropriated under the CARES Act, according to Federal Reserve oﬃcials.
490These two transactions were with the same two entities that had previously participated in the facility.
Page 319
GAO-21-387

funding that Treasury had committed but not disbursed to support the facilities and (2) disbursed
funds that exceeded the cost of assets held or principal of loans funded by the facilities. Of the
$102.5 billion that Treasury disbursed to support the facilities, the Federal Reserve returned a
little more than $62 billion in excess funding to Treasury, pursuant to the requirements of the
Consolidated Appropriations Act, 2021.491 According to Federal Reserve and Treasury oﬃcials, they
continue to monitor market conditions to assess the need for implementing new facilities, which
would be supported through non-CARES Act funds.
Non-CARES Act facilities. As of February 15, 2021, all four of the non-CARES Act facilities had
conducted $313.5 billion in transactions—with the Paycheck Protection Program Liquidity Facility
and the Primary Dealer Credit Facility accounting for about $118.9 billion and $132.3 billion,
respectively (see table).
491The CARES Act funds rescinded by the Consolidated Appropriations Act, 2021, were returned to the General Fund.
Page 320
GAO-21-387

Federal Reserve Lending Facilities without CARES Act Funding
Name of
facility
Purpose
Facility activity
Transaction
volume, as of
May 15, 2020
($ in billions)
Transaction
volume, as of
Oct. 15, 2020
($ in billions)
Transaction
volume, as of
Feb. 15, 2021
($ in billions)
Commercial
Paper Funding
Facility
Serve as funding
backstop to provide
liquidity for U.S.
issuers of commercial
paper
Purchase commercial paper
from eligible companies; eligible
issuers include U.S. issuers of
commercial paper, including
municipal issuers and U.S.
issuers with a foreign parent
company
4.24
4.27
4.27
Money Market
Mutual Fund
Liquidity
Facility
Assist money market
mutual funds in
meeting demands
for redemption by
households and other
investors
Make nonrecourse loans
available to eligible ﬁnancial
institutions that are secured by
high-quality assets purchased
by the ﬁnancial institution from
money market mutual funds
58.01
58.01
58.01
Paycheck
Protection
Program
Liquidity
Facility
Facilitate lending by
eligible institutions
that provide loans
to small businesses
under the Paycheck
Protection Program
(PPP)
Lend to institutions eligible
for making PPP loans on a
nonrecourse basis, taking PPP
loans as collaterala
45.97
101.22
118.94
Primary Dealer
Credit Facility
Provide support
to primary dealers
to facilitate the
availability of credit
to businesses and
households
Provide loans to primary dealers
in exchange for collateral
118.41
129.83
132.29
Source: GAO analysis of the Federal Reserve System documents and data. | GAO-21-387
aThe Federal Reserve established the PPP Liquidity Facility under its Section 13(3) authority to encourage participation in PPP,
which was established under the CARES Act.
More than three-quarters of transactions in non-CARES Act facilities occurred before May 15,
2020. On November 30, 2020, the Federal Reserve and Treasury extended the non-CARES Act
facilities through March 31, 2021. On March 8, 2021, the Federal Reserve and Treasury extended
the Paycheck Protection Program Liquidity Facility through June 30, 2021. The Federal Reserve
also announced that the remaining three non-CARES Act facilities would not be extended beyond
March 31, 2021.492
Oversight of facilities. The Federal Reserve’s Division of Reserve Bank Operations and Payment
Systems developed and documented a general framework for oversight of the facilities. The
492The three non-CARES Act facilities that will terminate on March 31, 2021 are the Primary Dealer Credit Facility, the
Commercial Paper Funding Facility, and the Money Market Mutual Fund Liquidity Facility.
Page 321
GAO-21-387

framework includes reviews of established governance structures, process workﬂows, and internal
control design, among other things. The division had completed these reviews for all facilities by
December 2020. According to Federal Reserve oﬃcials, as of March 2021, the division is ﬁnalizing
its plans for the last phase of oversight reviews. This ﬁnal phase is to build on the prior reviews by
tailoring the reviews for each facility, taking into account each facility’s credit and other risks.
Agency Comments
We provided a copy of this enclosure to the Federal Reserve, Treasury, and the Oﬃce of
Management and Budget for review. The Federal Reserve and Treasury provided technical
comments that we incorporated, where appropriate.
Methodology
To conduct this work, we reviewed Federal Reserve documentation on each facility, including
term sheets and related press releases, reports to Congress, and the most recent Federal Reserve
transaction data available on the facilities, as of February 2021. We assessed the reliability of the
transaction data by reviewing published data on the facilities and obtaining information from
Federal Reserve oﬃcials on the collection, maintenance, and compilation of the data. We also
interviewed Federal Reserve and Treasury oﬃcials.
Contact information: Michael E. Clements, (202) 512-8678, clementsm@gao.gov
Related GAO Products
Federal Reserve Lending Programs: Use of CARES Act-Supported Programs Has Been Limited and Flow of
Credit Has Generally Improved. GAO-21-180. Washington, D.C.: December 10, 2020.
Federal Reserve System: Opportunities Exist to Strengthen Policies and Processes for Managing
Emergency Assistance. GAO-11-696. Washington, D.C.: July 21, 2011.Loans for Aviation and Other
Eligible Businesses
Page 322
GAO-21-387

Loans for Aviation and Other Eligible Businesses
The Department of the Treasury provided loans for up to $22 billion to 35 aviation and national
security businesses.
Entities involved: Department of Defense, Department of Transportation, and Department of the
Treasury
Key Considerations and Future GAO Work
In December 2020, we reported on the Department of the Treasury’s (Treasury) implementation
of the CARES Act loan program for aviation and other eligible businesses, and we identiﬁed
lessons for designing and implementing this type of emergency lending program for Congress and
Treasury for the future. As Treasury moves to monitoring borrowers’ compliance with loan terms
and conditions, we continue to review the outcomes of loan applications and Treasury’s plans to
monitor borrowers’ compliance with the terms and conditions of loan agreements.
Background
The CARES Act authorized Treasury to provide up to $46 billion in loans and loan guarantees to
certain aviation businesses and other businesses deemed critical to maintaining national security
(national security businesses).493 This loan program was intended to provide liquidity to targeted
sectors. Treasury executed 35 loans to businesses in these targeted sectors, totaling about $22
billion, as shown in the table below.494
493CARES Act, Pub. L. No. 116-136, 134 Stat. 281, 470 (2020). The CARES Act did not provide criteria for which businesses
were “critical to maintaining national security.” Treasury established the following deﬁnition: (1) performing under a “DX”-
priority-rated contract or order under the Defense Priorities and Allocations System regulations (15 C.F.R. part 700) or (2)
operating under a valid top secret facility security clearance under the National Industrial Security Program regulations
(32 C.F.R. part 2004). Treasury guidance further noted that applicants that did not meet either of these criteria may still
be considered for loans, if, based on the recommendation and certiﬁcation by the Secretary of Defense or the Director
of National Intelligence that the applicant’s business is critical to maintaining national security, the Secretary of the
Treasury determines that the applicant business is critical to maintaining national security.
494As directed by the CARES Act, Treasury coordinated with the Department of Transportation (DOT) to determine
the eligibility of certain applicants. DOT conﬁrmed the type of carrier applicants (passenger and cargo) and the status
of their operations, and reported this information to Treasury, according to DOT. Treasury also coordinated with the
Department of Defense to determine the eligibility of applicants.
Page 323
GAO-21-387

Loans for the CARES Act Loan Program for Aviation and Other Eligible Businesses
Loan category
Number of loans executed
Assistance provided
($ millions)
Passenger and cargo air carrier
17
21,202
Repair station
5
20
Ticket agent
2
20
National security business
11
700
Total
35
21,942
Source: GAO Analysis of the Department of the Treasury data. | GAO-21-387
Note: Section 4003 authorized maximum assistance available through loans in three categories: passenger air carrier, repair
station operator, and ticket agent ($25 billion); cargo air carrier ($4 billion); and businesses critical to national security ($17
billion). CARES Act, Pub. L. No. 116-136, § 4003, 134 Stat. 281, 470 (2020). To match Treasury’s reporting on these loans and
because air carriers that received loans could provide both passenger and cargo air services, we combined all air carriers into a
single category.
The loan agreements executed by Treasury ranged in size from nearly $295,000 to $7.5 billion, as
amended.495 Treasury prioritized applications from the largest passenger air carriers and executed
loan agreements with seven of them totaling about $20.8 billion. Treasury’s authority to make new
loans ended on December 31, 2020.
The CARES Act set out conditions for this loan program including, among other things, that
borrowers not reduce employment levels by more than 10 percent from levels as of March 24,
2020, through September 30, 2020, and refrain from share buybacks and dividend payments until
12 months after the date the loan or loan guarantee is no longer outstanding.
Overview of Key Issues
Of the 35 loans executed, 26 were secured by business assets and 9 were unsecured. Loans
to 16 air carriers, including seven major airlines, were secured by business assets including airline
loyalty programs, aircraft, and aircraft parts. Five national security businesses, four repair station
operators, and one ticket agent also had loans secured by business assets including equipment
and accounts receivable.
The nine unsecured loans went to six national security businesses, one repair station operator,
one air carrier, and one ticket agent. Treasury decided to oﬀer unsecured loans for $20 million or
less. As such, the size of unsecured loans ranged from $450,000 to $20 million.
Of the 35 loans executed, employment retention requirements for loans diﬀered for
aviation and national security businesses. The terms of the 24 loans made to air carriers, repair
495This ﬁgure includes amendments to loan commitments made to loan agreements after the initial closings. The
amendments include increases in loan commitments that reallocated unused funds, according to Treasury.
Page 324
GAO-21-387

station operators, and ticket agents included the requirement to maintain employment levels as
of March 24, 2020, to the extent practicable, and not reduce employment levels by more than 10
percent from March 24, 2020, levels through September 30, 2020—matching the requirement
in the CARES Act. For 10 national security businesses, the employment requirement included in
the loan terms does not expire until September 30, 2021. For the remaining national security
business—Yellow Corp., formerly known as YRC Worldwide, Inc—the employment requirement
does not expire until October 20, 2021.496
Other loan terms, including the interest rates and duration of loans were relatively uniform across
the executed loan agreements. Speciﬁcally, all but two of the executed loans had a duration of 5
years or approximately 5 years.497 Treasury oﬃcials said they worked with their ﬁnancial advisors
for the program to determine interest rates, and that Treasury set rates to reﬂect the risk of loans
in accordance with the CARES Act. Interest rates for unsecured loans used a benchmark interest
rate for short-term loans plus 5.5 percent and for secured loans added from 2.5 percent to 3.5
percent to this benchmark interest rate.498 Treasury has allowed borrowers to defer interest for 1
year.
As of March 1, 2021, seven businesses still had funds available for use, and 28 had drawn
down the entire loan amount or terminated access to remaining funds when they prepaid
their loan. Depending on the size of the loan, Treasury generally required borrowers to draw
down 10 percent or the entire amount of the loan when the loan agreement was executed. In
nearly all cases, borrowers with loans over $300 million had to draw down 10 percent of the loan
amount when the loan was executed, while borrowers with loans less than $300 million had to
draw down the entire loan amount.
Eight companies—one national security business and seven passenger air carriers—had loans
over $300 million, and all drew down at least the required 10 percent near the time the loan was
executed.499 The national security business has since drawn down more of its loan funds, with
nearly 80 percent of that loan drawn down as of March 1, 2021. Initially, the seven air carriers had
until March 26, 2021, to draw down additional loan funds. However, in January 2021, Treasury
oﬃcials changed this date to May 28, 2021—allowing borrowers more time to decide if they need
to use these funds and also giving borrowers more time to seek private ﬁnancing.
As of March 1, 2021, two borrowers have repaid loans: Ovation Travel Group repaid its loan
for $20 million in January 2021, and Hawaiian Airlines, Inc., repaid its loan of $45 million and
terminated the commitment for undrawn funds in February 2021. Treasury’s loan agreements
allow borrowers to repay loans early without penalty and terminate Treasury’s commitments,
according to Treasury oﬃcials. Other borrowers may repay or replace Treasury loans in the near
496For Yellow Corp., the maintenance of employment requirement expires 12 months after the initial funding date for
each tranche of its loan. Tranche A funding occurred on July 9, 2020, and tranche B initial funding occurred on October
20, 2020.
497Yellow Corp. and Hawaiian Airlines executed loans with a duration of approximately 4 years.
498The benchmark interest rate used in these loan agreements is the London Inter-Bank Oﬀered Rate (LIBOR).
499The eight companies are Alaska Airlines, American Airlines, Frontier Airlines, Hawaiian Airlines, JetBlue Airways,
SkyWest Airlines, United Airlines, and Yellow Corp. When Treasury increased loan commitments, Treasury did not require
borrowers to make additional draws to reach 10 percent of the new total commitment.
Page 325
GAO-21-387

term. On March 8, 2021, American Airlines announced plans to raise ﬁnancing in private markets,
a portion of which it planned to use to repay the outstanding balance of its Treasury loan.
In their applications, loan recipients reported that they planned to use the proceeds of the loans
for multiple purposes, including for payroll and other operating expenses and providing liquidity
to ensure continued operations.
The most common reasons loan applicants were not approved for loans diﬀered for
aviation and national security business applicants. Most of the 193 businesses that applied
as passenger or cargo air carriers, ticket agents, or repair station operators were withdrawn, and
most of the 74 businesses that applied as businesses critical to national security were rejected,
as shown in the table below. Aviation applications were withdrawn for reasons such as not
responding to Treasury requests for more ﬁnancial data (42 applicants), entering bankruptcy (24
applicants), or not meeting Treasury’s credit standards (8 applicants). National security business
applications were most frequently rejected for not meeting Treasury’s criteria as a business critical
to national security (25 applicants). Other reasons for rejection and withdrawal included missing
deadlines or not responding to Treasury’s request for more information (11 applicants) and not
meeting Treasury’s credit standards (9 applicants). We continue to review the eﬀect of Treasury’s
loan program in ongoing work.
Page 326
GAO-21-387

Application Outcomes for the CARES Act Loan Program for Aviation and Other Eligible Businesses
Loan category
Number of
applications
Number of
applications
approved
Number of
applications
rejected
Number of
applications
withdrawn
Passenger air carrier
93
15
0
61
Repair station operator
41
5
0
28
Ticket agent
50
2
0
34
Cargo air carriera
9
2
0
1
National security business
74
11
40
23
Total b
267
35
40
147
Source: GAO Analysis of the Department of the Treasury data. | GAO-21-387
Note: CARES Act, Pub. L. No. 116-136, § 4003, 134 Stat. 281, 470 (2020).
aOne of the loan recipients, Island Wings, operates as a passenger and cargo air carrier. However, this business applied and
was approved for a Treasury loan as a cargo air carrier.
bIn the data provided by Treasury, the status of 45 aviation applications was not indicated. That is, the applicants neither
executed loan agreements with Treasury, nor was there any indication in the data that these applicants withdrew from the
program or were asked by Treasury to withdraw.
Agency Comments
We provided DOT, Treasury, and the Oﬃce of Management and Budget (OMB) with a draft of
this enclosure. DOT and Treasury provided technical comments, which we incorporated as
appropriate. OMB did not have comments on the enclosure.
Methodology
To conduct this work, we reviewed the most recent Treasury data on the loan program
applications as of February 18, 2021; reviewed agency reports and guidance; reviewed the
Consolidated Appropriations Act, 2021 and the CARES Act; and interviewed Treasury oﬃcials. We
reviewed data on applications and related data ﬁelds by interviewing agency oﬃcials about the
data’s consistency and completeness. We determined the data were suﬃciently reliable for the
purposes of our enclosure.
Contact information: Heather Krause, (202) 512-2834, krauseh@gao.gov
Related GAO Product
Financial Assistance: Lessons Learned from CARES Act Loan Program for Aviation and Other Eligible
Businesses. GAO-21-198. Washington, D.C.: December 10, 2020.
Page 327
GAO-21-387

Payroll Support Assistance to Aviation Businesses
The Department of the Treasury continues to administer additional payroll assistance for the
aviation industry, and has started but not completed a plan to monitor recipients’ compliance with
the terms of this assistance.
Entities involved: The Department of Transportation and the Department of the Treasury
Key Considerations and Future GAO Work
In November 2020, we recommended that the Secretary of the Treasury should ﬁnish developing
and implement a compliance monitoring plan that identiﬁes and responds to risks in the ﬁrst
Payroll Support Program to ensure program integrity and address potential fraud, including
the use of funds for purposes other than for the continuation of employee wages, salaries, and
beneﬁts. Consistent with our recommendation, Treasury has developed a compliance process
document, but has not completed supporting documents detailing its procedures and how it will
implement them. We will evaluate these documents, once provided, to determine whether they
address our recommendation.
Passenger demand for air travel remains far below prior years’ demand, and, according to
industry forecasts, faces a slow, uneven recovery over the next 3 or more years. While passenger
demand for air travel is expected to eventually return—especially as COVID-19 vaccination rates
increase—the strength and speed of the recovery is uncertain. As a result, many aviation sector
businesses that depend on passenger travel, including airlines and those businesses that support
passenger air travel, remain in a poor ﬁnancial position.
In September and November 2020, we reported concerns with the rollout of the initial Payroll
Support Program (PSP1), which was established in the CARES Act, and Treasury’s plans to monitor
recipients’ compliance with agreement terms.500 With a Payroll Support Program Extension (PSP2)
in December 2020 and another extension in March 2021, we continue to monitor these and any
new concerns, such as the timing of awards and the oversight of award amounts and use of
funds.501
Background
The Consolidated Appropriations Act, 2021 appropriated $16 billion to Treasury to provide
ﬁnancial assistance to make additional payments to be used for employee wages, salaries,
and beneﬁts.502 Under this act, PSP2 provides the ﬁnancial assistance to two categories of
applicants—up to $15 billion for passenger air carriers and up to $1 billion for certain aviation
500The CARES Act authorized Treasury to provide up to $32 billion in ﬁnancial assistance through PSP1. Treasury signed
PSP1 agreements with passenger air carriers, cargo air carriers, and certain aviation contractors from April 2020 through
October 2020. CARES Act, Pub. L. No. 116-136, § 4112, 134 Stat 281, 498 (2020).
501The American Rescue Plan Act of 2021, enacted on March 11, 2021, appropriates an additional $15 billion for eligible
air carriers and contractors to extend the Payroll Support Program. Pub. L. No. 117-2, § 7301, 135 Stat. 4, 104-07.
502Pub. L. No. 116-260, div. N, tit. IV, 134 Stat. 1182, 2052-61 (2020).
Page 328
GAO-21-387

contractors. As was the case with PSP1, Treasury requires passenger air carriers receiving awards
over $100 million and contractors receiving awards over $37.5 million to provide warrants or notes
as taxpayer protection.503 The amount of payroll support an applicant is eligible for depends on
the business type, payroll, and participation in PSP1.
As required by statute, PSP2 recipients must agree to refrain from conducting involuntary
furloughs or terminations and reducing pay rates and beneﬁts of employees until March 31, 2021,
among other requirements.504 Within 72 hours after signing a PSP2 agreement, recipients must
recall any employees who were involuntarily terminated or furloughed between October 1, 2020
(for recipients that received PSP1 ﬁnancial assistance) or March 27, 2020 (for recipients that did
not receive PSP1 ﬁnancial assistance) and the date of the PSP2 agreement. In addition to recalling
previously furloughed employees, PSP2 recipients must compensate returning employees for lost
pay and beneﬁts between December 1, 2020, (for passenger air carriers) or December 27, 2020,
(for contractors) and when the applicant entered into the PSP2 agreement.
Overview of Key Issues
Treasury had awarded over $13.2 billion to 261 companies as of March 10, 2021. Treasury
received 549 applications for PSP2, with 320 from passenger air carriers and 229 from aviation
contractors.505 Similar to the approach with PSP1, Treasury prioritized applications from
businesses with the most employees. For example, Treasury signed PSP2 agreements with the 12
largest passenger airlines within 7 business days of their application to the program. As of March
10, 2021, 190 passenger air carriers and 71 aviation contractors had signed PSP2 agreements
(see ﬁg.). The average award amount was over $66 million for passenger air carriers and nearly
$9 million for contractors, with 4 passenger air carriers receiving awards over $1 billion and 11
receiving awards over $100 million. Due to the high demand for the program and as authorized in
statute, Treasury is prorating award amounts—with passenger air carriers expected to receive 40
percent and contractors expected to receive 30 percent of their total approved award amount.
503Passenger air carriers, when applicable, are required to provide notes equal to 30 percent of the value of awards over
$100 million with a 10-year term. Contractors, when applicable, must provide notes equal to 44 percent of the payroll
support provided for over $37.5 million with a 10-year term. Cash interest on the notes is payable semiannually each
year beginning on March 31, 2021. The warrants provide Treasury with the right to purchase shares of common stock or
receive cash payment.
504Contractors must agree to refrain from involuntary furloughs or layoﬀs until March 31, 2021, or until the contractor
has expended all of its PSP2 funds, whichever occurs later. The Consolidated Appropriations Act, 2021 authorized
the Secretary of the Department of Transportation (DOT) to require, “to the extent reasonable and practicable,” an air
carrier receiving ﬁnancial assistance under the act to maintain scheduled air transportation service as the Secretary
deems necessary to ensure services to any point served by that air carrier before March 1, 2020. Other requirements all
applicants must follow include agreeing to not pay dividends or make any other capital distributions, with respect to the
common stock of the applicant through at least March 31, 2022.
505According to Treasury guidance, applications received before 11:59 p.m. EDT on January 14, 2021, were to be
processed as quickly as possible. Applications received after 11:59 p.m. EDT on January 25, 2021, may not have been
considered.
Page 329
GAO-21-387

Timing and Anticipated Award Amounts for Treasury’s Payroll Support Program Extension (PSP2), by Type of
Recipient, as of March 10, 2020
Treasury built on lessons learned from PSP1 but has faced challenges rolling out PSP2.
According to Treasury oﬃcials, the processes to review, approve, and distribute PSP2 payments
are similar to those used with PSP1. Learning from issues that arose with PSP1, Treasury
dedicated time and resources to redesigning the online application portal to ensure more
complete responses and make it more user-friendly. Treasury is also using information from PSP1
compliance reports in its review of PSP2 applications. For example, if Treasury has concerns that a
PSP2 applicant may not be in compliance with its PSP1 agreement terms, its PSP2 application will
not advance through Treasury’s review process until the issues are resolved. If the issues cannot
be resolved, the PSP2 application is not submitted for ﬁnal review.
As was the case with PSP1, PSP2 is an emergency program with intense interest and high
expectations from applicants. Treasury oﬃcials said they must balance the need to disburse funds
quickly with the need to ensure all statutory requirements are met which, given the complexity of
PSP2 requirements, has been a challenge.
Industry associations representing businesses eligible to apply to PSP2 said their members
appreciated the extension of the program and noted improvements to the application process,
notably in the application portal. However, these associations noted their members had concerns
similar to those raised about PSP1, namely the length of time Treasury is taking to approve and
disburse awards and the need for additional guidance.506 Treasury oﬃcials said they would
provide additional information or guidance if they observe a high frequency of the same issues
on applications or they receive many questions from applicants or recipients on similar issues. On
March 10, 2021, Treasury released a new question and answer document for PSP2 that covered
recalling employees and PSP2 agreement terms, among other topics.
506Seventy-eight percent of the 549 companies that applied to PSP2 also participated in PSP1. Eighty-three percent of
passenger air carriers that applied to PSP2 received PSP1 awards and 69 percent of contractors that applied to PSP2
received PSP1 awards.
Page 330
GAO-21-387

Treasury has started but not completed plans to monitor PSP1 recipients’ compliance with
agreement terms. In February 2021, Treasury provided us a copy of its Process Overview for
CARES Operations Compliance Testing. This document outlined the steps Treasury uses in its
compliance process for PSP1 but did not include details on automated tests used on all recipients,
factors or thresholds from testing that trigger additional review, or remedies and penalties
for noncompliance. According to Treasury oﬃcials, the agency is using such tests, factors, and
thresholds to conduct monitoring currently, but it is still developing and ﬁnalizing these details for
PSP1, as well as for PSP2. We will more fully evaluate Treasury’s eﬀorts to develop a compliance
monitoring plan when we can review more detailed documents from Treasury; however, Treasury
was not able to estimate when these documents will be completed.
While PSP2 had broad support from the aviation industry, most do not see a sustained
recovery in 2021. There was broad aviation industry support for extending payroll support
payments, including from airlines, unions representing airline employees, and industry
associations representing smaller passenger air carriers and contractors. However, based on
industry forecasts passenger demand for air travel is not expected to recover for several years.
In addition to the uncertainty around when the aviation industry will return to prepandemic levels
of operation, how businesses have been aﬀected by the pandemic has also diﬀered, in some cases
signiﬁcantly. For example, air carriers that focus on transporting cargo have fared much better
during the last year than those that depend on transporting passengers. Even among companies
that focus on transporting passengers, the extent to which their business models rely on leisure
or business travel, domestic or international travel, or scheduled or unscheduled air service may
have resulted in diﬀerent outlooks and levels of loss. As the year unfolds, trends in the pace or
nature of recovery may be issues to consider in providing any future ﬁnancial assistance to the
aviation industry to ensure it is eﬀective and eﬃcient.
Agency Comments
We provided DOT, Treasury, and the Oﬃce of Management and Budget (OMB) with a draft of this
enclosure. DOT provided technical comments; Treasury and OMB did not have comments on the
enclosure.
Methodology
To conduct this work, we reviewed the most recent Treasury data on the Payroll Support Program
extension (PSP2) as of March 10, 2021; reviewed agency guidance and policy; reviewed the
Consolidated Appropriations Act, 2021; and interviewed Treasury oﬃcials. We reviewed PSP2 data
for outliers and missing information and interviewed agency oﬃcials, and we determined that
Treasury’s data were suﬃciently reliable for the purposes of summarizing the number, value, and
timing of PSP2 awards to recipients.
We also reviewed reports (8-Ks and 10-Ks) ﬁled with the Securities and Exchange Commission
from January 2021 through February 2021 by airlines that received payroll support awards of over
$100 million. We reviewed these reports to understand these companies’ rationale for taking PSP2
Page 331
GAO-21-387

funds and expected eﬀects. We also interviewed industry associations representing passenger air
carriers and contractors eligible for PSP2 funds to understand their experience so far with PSP2.
Contact information: Heather Krause, (202) 512-2834, krauseh@gao.gov
Page 332
GAO-21-387

Amtrak Grants
Amtrak used CARES Act funds and is using Consolidated Appropriations Act, 2021 funds to address
shortfalls in ticket revenue, pay employee salaries, and cover other operating, debt, and capital
expenses, but it faces immediate and longer-term challenges.
Entities involved: Amtrak; Federal Railroad Administration, within the Department of
Transportation
Key Considerations and Future GAO Work
We will continue to monitor how the National Railroad Passenger Corporation (commonly known
as Amtrak) uses Consolidated Appropriations Act, 2021 funds, as well as its rail service and
workforce levels.
Background
Amtrak provides almost all intercity passenger rail service in the U.S. across an approximately
21,000-mile rail network. This system includes three lines of business: the Northeast Corridor,
28 state-supported short-distance (750 miles or less) routes funded in part by the 17 states they
serve, and long-distance (greater than 750 miles) routes that connect rural areas with major
cities.507
Amtrak depends on grants from the federal government to operate the national passenger rail
system and reinvest in the underlying infrastructure. Amtrak has received annual federal funding
through grants from the Federal Railroad Administration (FRA), which executes and oversees grant
agreements with Amtrak. For example, the Consolidated Appropriations Act, 2021 provided $700
million for the Northeast Corridor Grants program and $1.3 billion for the National Network Grant
program, which includes the state-supported and long-distance routes.508
Prior to the COVID-19 pandemic, Amtrak had seen steady increases in ridership and revenues
on its network, with over 32 million trips taken in ﬁscal year 2019.509 As a result of the pandemic,
Amtrak experienced a signiﬁcant drop in ridership and corresponding revenue from ticket sales
across its network. Amtrak received $1.018 billion through the CARES Act to prevent, prepare
for, and respond to COVID-19. This included $492 million through the Northeast Corridor Grants
program and $526 million through the National Network Grants program, of which at least $239
507Amtrak owns about 360 of the 457 miles of the Northeast Corridor, which generally runs from Boston,
Massachusetts, to Washington, D.C. However, Amtrak provides the majority of its long-distance and state-supported
service on infrastructure (tracks and other facilities) owned by others, such as freight railroads or public agencies.
508Consolidated Appropriations Act, 2021, Pub. L. No. 116-260, div. L, tit. I, 134 Stat. 1182, 1849-50 (2020).
509In the years since it ﬁrst began operations in 1971, Amtrak’s annual operating expenses exceeded its revenues.
Amtrak operated at an overall loss of $881 million in ﬁscal year 2019, but Amtrak oﬃcials had thought that in 2020, on
an adjusted operating loss basis, revenues would exceed these expenses for the ﬁrst time in 50 years.
Page 333
GAO-21-387

million was to oﬀset payments by states to Amtrak for operating its state-supported routes.510 FRA
has awarded all of these funds to Amtrak, and as of January 31, 2021, Amtrak had expended $995
million, or 98 percent of the funds. Amtrak oﬃcials said the remaining funds would be expended
by the end of February 2021.
In December 2020, Congress passed the Consolidated Appropriations Act, 2021, which provided
Amtrak with an additional $1 billion in emergency relief funds to support the Northeast Corridor,
state-supported, and long-distance passenger rail services. This included $285 million to assist
states and commuter rail providers in making required payments to Amtrak.511 Oﬃcials from
Amtrak said that the remaining $713 million in funds will be used to oﬀset the loss in revenue
from operations on the Northeast Corridor ($566.6 million) and the National Network ($146.7
million). According to Amtrak oﬃcials, they will administer and expend the Consolidated
Appropriations Act, 2021 funds almost identically to how they administered and expended the
CARES Act funds.512 FRA awarded the Consolidated Appropriations Act, 2021 funds to Amtrak in
February 2021.
In March 2021, the American Rescue Plan Act of 2021 provided Amtrak with an additional
$1.7 billion to support the Northeast Corridor Grants program and National Network Grants
program.513
Overview of Key Issues
Similar to what we reported in November 2020, Amtrak oﬃcials said they had not faced signiﬁcant
challenges expending the CARES Act funds. The Amtrak Oﬃce of Inspector General reported in
August 2020 that Amtrak moved swiftly to develop a comprehensive plan for using, tracking, and
510The CARES Act limited the amount that Amtrak could invoice the states for their share of losses on routes that
Amtrak operates on behalf of states in ﬁscal year 2020 to 80 percent of the amount each state paid for ﬁscal year 2019.
For example, if a state paid the company $1 million for this service in ﬁscal year 2019, the state could not pay more than
$800,000 in ﬁscal year 2020. To oﬀset this reduction, the CARES Act provided $239 million in funds that Amtrak was
to draw down each month to cover the diﬀerence between the full cost of providing state-supported services and the
reduced amount the company can charge the states. The CARES Act also allowed FRA to transfer and merge the funds
provided for the Northeast Corridor Grants and National Network Grants programs. CARES Act, Pub. L. No. 116-136, 134
Stat. 281, 598-599 (2020).
511Consolidated Appropriations Act, 2021, Pub. L. No. 116-260, div. M, tit. IV, 134 Stat. 1182, 1944-45 (2020). Speciﬁcally,
$174.9 million is to be used toward state payments for partner cost-sharing under Sec. 209 of the Passenger Rail
Investment and Improvement Act, and $109.8 million in lieu of capital payments from states and commuter rail
passenger transportation providers subject to the cost allocation policy developed under 49 U.S.C. § 24905(c).
Additionally, the law allows the Department of Transportation to retain up to $2.030 million to fund the costs of project
management and oversight of certain activities authorized by the Fixing America’s Surface Transportation Act.
512As we reported in November 2020, the expenditure categories include operating labor, direct-COVID expenditures,
protected pay, and other qualifying expenses, which Amtrak expanded to include eligible capital expenses and debt
service payments, along with train-related expenses such as fuel, power, and commissary food.
513Pub. L. No. 117-2, § 3401, 135 Stat. 4, 94-96.
Page 334
GAO-21-387

reporting on CARES Act funds.514 Furthermore, in December 2020, the Inspector General reported
that Amtrak was eﬀectively using, accounting for, and reporting on these funds, and that it had
addressed the initial risks the Inspector General identiﬁed in August 2020.515
Immediate and long-term challenges. While Amtrak did not experience challenges expending
the CARES Act funds and does not anticipate challenges administering the Consolidated
Appropriations Act, 2021, funds, Amtrak continues to face both immediate and longer-term eﬀects
on its operations stemming from the pandemic, according to oﬃcials. As we previously reported,
these challenges include reduced ridership and revenue and uncertainty over long-term ﬁnancial
sustainability. In addition, Amtrak oﬃcials identiﬁed potential challenges with training and staﬃng
resulting from its workforce and service reductions.
Ridership and revenue. Amtrak continues to face reduced ridership, and ridership was 80 percent
less in January 2021 than in January 2020 on all lines of business (see ﬁgure). In January 2021,
Amtrak oﬃcials reiterated that they have not experienced, and are not forecasting in the near
future, signiﬁcant improvements in ridership. According to Amtrak oﬃcials, they reset their
ridership forecasts at the start of the ﬁscal year and continue to base their assumptions on
the availability of a vaccine, current rail and aviation travel trends, and customer survey data.
Amtrak anticipates some increase in ridership in the third quarter of the ﬁscal year as the vaccine
becomes more widely available. Amtrak oﬃcials expect that ridership will recover to 35 percent
of pre-pandemic levels in the fourth quarter of ﬁscal year 2021, based on the capacity available
and mix of markets served. This ﬁgure is likely to change as COVID-19 recovery trends continue to
evolve and as Amtrak makes changes in future levels of train service provided through the end of
ﬁscal year 2021.
514Amtrak, Oﬃce of Inspector General, Governance: Observations on Amtrak’s Use of CARES Act Funds, OIG-MAR-2020-013
(Washington, D.C.: Aug. 5, 2020). In January 2021, the Amtrak Inspector General initiated an audit assessing Amtrak’s
administration of the Consolidated Appropriations Act, 2021 funds to continue to help it respond to COVID-19.
515Amtrak, Oﬃce of Inspector General, Governance: Final Observations on Amtrak’s Use of CARES Act Funds, OIG-
A-2021-005 (Washington, D.C.: Dec. 15, 2020). In August 2020, the Inspector General reported that while Amtrak was
taking steps to provide transparency over how it was allocating the $239 million in CARES Act funds set aside for state-
supported routes, the Inspector General had an ongoing audit assessing the cost-sharing and billing processes between
Amtrak and its state partners.
Page 335
GAO-21-387

Amtrak Ridership Actuals and Forecast, October 2018–September 2021
Note: The forecast for 2021 is tentative due to the uncertainty in the improvement in travel rates, the availability of a vaccine to
the public, and the end of the seasonal ﬂu, according to Amtrak oﬃcials.
Because revenue from ticket sales has fallen along with ridership, Amtrak has also dealt with
reduced revenues and budget shortfalls. For example, Amtrak revenues were 80 percent lower
in January 2021 than they were in January 2020.516 According to Amtrak oﬃcials, they expect
that revenue recovery will lag behind ridership recovery in the near term because business
travelers—who tend to pay for higher-value seats or preferable travel times—appear less likely to
resume travel. For example, ridership on the Acela line, which carries mostly business travelers
on the Northeast Corridor, remained over 90 percent lower in January 2021 than it was in January
2020, while ridership on the long-distance routes was down about 67 percent in January 2021
compared to January 2020 ridership levels.
Amtrak has taken steps to mitigate and plan for the impact of low ridership and revenues by
reducing its workforce and service levels. For example, Amtrak furloughed over 1,200 employees
as of January 14, 2021. Furthermore, it reduced the frequency of service on most of its long-
distance routes from daily to three times a week in October 2020, which it expects will reduce
costs by $150 million.517 However, according to Amtrak oﬃcials, the reductions in Amtrak’s
516In November 2020, we reported that Amtrak also faced challenges due to the potential loss of ﬁnancial support from
states and commuter railroads that operate on Amtrak’s network. The Consolidated Appropriations Act, 2021 provided
$284.7 million to assist states and commuter railroads with making required payments to Amtrak, which may alleviate
this challenge to some degree.
517According to Amtrak, the reduction of long-distance service should provide $300 million in costs savings, which is
oﬀset by a $150 million loss in ticket revenues, for an expected overall savings of $150 million. Amtrak oﬃcials said
they would consider resuming daily service on the long-distance routes using three metrics: 1) COVID-19 pandemic
hospitalization rates, 2) the percentage of trips booked for 2021, and 3) actual ridership levels. With the passage of the
Page 336
GAO-21-387

workforce have led to potential staﬃng and training challenges. For instance, because Amtrak
furloughed staﬀ, it has less ﬂexibility to backﬁll absenteeism in certain cases.518 Amtrak told us it
is monitoring staﬃng levels to minimize the impact on remaining service. Oﬃcials also noted that
Amtrak is planning future training, particularly for high-skill positions with longer training cycles,
to help ensure it has trained staﬀ when it starts increasing service again as demand rises over the
next few years. In addition, recently appropriated Consolidated Appropriations Act, 2021 funds
are required to be used by Amtrak to prevent additional furloughs and reductions in long distance
service.519
Long-term ﬁnancial sustainability . There may also be uncertainties about Amtrak’s long-term
ﬁnancial sustainability stemming from the impact COVID-19 has had on ridership. Amtrak oﬃcials
said it may take 3 to 5 years for ridership on its network to recover to 2019 levels. Amtrak has
developed low, medium, and high plans for when it expects to achieve 100 percent of pre-
pandemic ridership levels. Like the shorter-term forecasts, Amtrak anticipates revenue recovery
to lag behind ridership recovery, although Amtrak does anticipate it will achieve proﬁtability on
the Northeast Corridor in 2023. However, as a whole, Amtrak oﬃcials said the company is not
expected to become proﬁtable until after ﬁscal year 2026.
In addition, Amtrak expects that, while there may be shifts in ridership demographics, such as a
potential decline in business travelers that could impact revenues, some of these losses could
be oﬀset by Amtrak’s product modernization and capacity expansion plans, which could attract
new riders. For example, Amtrak oﬃcials stated that they have continued with capital projects
that had already been funded, such as the procurement of new Acela trainsets and the recently
renovated Moynihan Train Hall in New York City. However, Amtrak oﬃcials said they may have to
postpone new capital projects if they do not receive supplemental funding. Furthermore, Amtrak
developed ventilation and cleaning measures to assure passengers of the safety of Amtrak travel
in an attempt to increase ridership and protect staﬀ, according to oﬃcials.
FRA support and oversight of funding. According to FRA oﬃcials, they have not experienced any
challenges in overseeing Amtrak’s use of the CARES Act funds and do not anticipate any challenges
with the Consolidated Appropriations Act, 2021 funds. According to FRA oﬃcials, they will use the
same oversight structures used to oversee the CARES Act funds to monitor Amtrak’s use of the
Consolidated Appropriations Act, 2021 funds. In addition, FRA plans to monitor the burn rates of
Amtrak expenditures along diﬀerent lines of accounting and will review new monthly reporting
requirements to track expenditures of funds provided to assist commuter rail operators’ payments
to Amtrak.
Amtrak oﬃcials said that the Consolidated Appropriations Act, 2021 funds will only cover expenses
through April 2021. As a result, in January 2021, Amtrak submitted an updated funding request
American Rescue Plan, 2021, Amtrak plans to restore long-distance service using a phased approach starting in May
2021.
518According to Amtrak oﬃcials, staﬃng needs vary by location, and in most locations, they have had more than
suﬃcient staﬃng. However, in a few cases, Amtrak has had to recall furloughed employees when several employees
were suddenly absent.
519The Consolidated Appropriations Act, 2021 directs Amtrak to use funds made available under the act to prevent
further furloughs or service cuts. Furthermore, with the passage of the American Rescue Plan, 2021, Amtrak plans to
recall all of its employees furloughed on or after October 1, 2020, in response to COVID-19.
Page 337
GAO-21-387

that included an additional $1.54 billion in supplemental funding. The request covered funding to
operate and invest in Amtrak’s network, support its state and commuter partners, and addressed
various congressional concerns, such as avoiding additional employee furloughs and restoring
daily long-distance service. Amtrak’s immediate recovery will be aﬀected by these funding
decisions and the actions it takes to mitigate its near-term challenges. In March 2021, the America
Rescue Plan, 2021 makes available $1.7 billion to Amtrak and requires Amtrak to use a portion
of those funds to restore daily long-distance service and reinstate furloughed employees, among
other things. Moreover, Amtrak’s authorization expires at the end of ﬁscal year 2021, and Amtrak
has asked Congress to consider establishing an intercity passenger rail trust fund to provide a
more stable funding source to help it improve and expand its network. Future decisions about
Amtrak will also aﬀect how it evolves to maintain long-term ﬁnancial sustainability.
Agency Comments
We provided Amtrak, FRA, and the Oﬃce of Management and Budget (OMB) with a draft of this
enclosure. OMB did not have comments on this enclosure. Amtrak and FRA provided technical
comments that we incorporated, where appropriate.
Methodology
To conduct this work, we reviewed the most recent agency data Amtrak provided to FRA as of
January 31, 2021, relevant laws, and agency guidance on the Northeast Corridor and National
Network Grant programs. We also met with senior Amtrak oﬃcials to discuss Amtrak’s plans to
recover from the pandemic-driven decline in ridership and revenue, and we obtained information
from FRA about any challenges in overseeing Amtrak’s use of the CARES Act and Consolidated
Appropriations Act, 2021 funds. To assess the reliability of the Amtrak data, we conducted
interviews with knowledgeable oﬃcials and reviewed documentation on the assumptions
underlying Amtrak’s ridership and revenue forecasts. We determined that the data were reliable
for our purposes.
Contact information: Elizabeth Repko, (202) 512-2384, repkoe@gao.gov
Page 338
GAO-21-387

Assistance for Fishery Participants
By July 14, 2020, the Department of Commerce’s National Oceanic and Atmospheric
Administration had obligated almost $297 million of the available $298 million in CARES Act
funding for ﬁshery participants, but as of February 1, 2021, ﬁsheries commissions had disbursed
$96.3 million to ﬁshery participants.
Entity involved: National Oceanic and Atmospheric Administration, within the Department of
Commerce.
Key Considerations and Future GAO Work
In January 2021, we recommended that the Assistant Administrator for the National Oceanic
and Atmospheric Administration (NOAA) Fisheries develop a mechanism to track the progress of
states, tribes, and territories in meeting timelines established in spend plans to disburse funds in
an expedited and eﬃcient manner. NOAA concurred with this recommendation. As of February 1,
2021, the agency had developed an electronic tracking tool to track the disbursement of funds and
had begun to input data into it.
We will continue to monitor CARES Act assistance to ﬁshery participants in ongoing and planned
work. In September 2020, the Department of Commerce’s Inspector General started an evaluation
of the National Oceanic and Atmospheric Administration’s implementation of CARES Act funding,
including examining the steps taken to implement the act, any challenges encountered, and the
oversight of the funds obligated and disbursed under the act.
Background
Commercial and recreational marine ﬁsheries are critical to the nation’s economy, contributing
approximately $99.5 billion to the U.S. gross domestic product and supporting approximately 1.7
million jobs in 2016, according to NOAA.520 Widespread restaurant closures in the spring of 2020
led to a decrease in demand for seafood, adversely aﬀecting the ﬁsheries industry.
The CARES Act authorizes the Department of Commerce to provide assistance to eligible tribal,
subsistence, commercial, and charter ﬁshery participants aﬀected by COVID-19, which may include
direct relief payments.521 The act appropriated $300 million to the Department of Commerce
to assist ﬁshery participants.522 After $2 million in administrative fees were assessed by NOAA,
$298 million of the $300 million was obligated for ﬁshery participants. These include tribes,
persons, ﬁshing communities, aquaculture businesses not otherwise eligible for certain assistance,
520U.S. Department of Commerce, National Oceanic and Atmospheric Administration, National Marine Fisheries Service,
Fisheries Economics of the United States, 2016, Technical Memorandum NMFS-F/SPO-187a (Silver Spring, MD: December
2018). Information on gross domestic product and jobs includes data on commercial seafood harvesters, processors,
dealers, wholesalers, distributors, importers, and retailers, as well as recreational ﬁshing trips and ﬁshing equipment.
Data for 2016 were the most recent available at the time of our review.
521Pub. L. No. 116-136, § 12005(a), 134 Stat. at 518.
522 Id. § 12005(d).
Page 339
GAO-21-387

processors, and other ﬁshery-related businesses, who have incurred, as a direct or indirect result
of COVID-19, certain speciﬁed economic revenue losses or other negative impacts.523 Businesses
such as vessel repair businesses, restaurants, and seafood retailers are not considered ﬁshery-
related businesses eligible to receive CARES Act funding, according to NOAA’s website.
Overview of Key Issues
Funding was allocated in May 2020. On May 7, 2020, the Secretary of Commerce announced
the allocation of about $298 million of the $300 million in CARES Act funding for states, tribes, and
territories with ﬁshery participants, as shown in the table.524
523 Id. § 12005(b). Speciﬁcally, “ﬁshery participants” are deﬁned as belonging to these categories and as having incurred,
as a direct or indirect result of the COVID-19 pandemic, economic revenue losses greater than 35 percent as compared
with their prior 5-year average revenue or any negative impacts to subsistence, cultural, or ceremonial ﬁsheries.
Additionally, the CARES Act provided that the Department of Commerce may use up to 2 percent of the $300 million for
administration and oversight activities.
524Puerto Rico and the U.S. Virgin Islands are not part of an interstate commission.
Page 340
GAO-21-387

Department of Commerce’s Allocation of CARES Act Funding for States, Tribes, and Territories with Fishery
Participants on May 7, 2020
Interstate commission a
State/tribe/territory
Allocation b
($ thousands)
Atlantic States Marine Fisheries Commission
Massachusetts
Florida
Maine
New Jersey
New York
North Carolina
Virginia
Maryland
Pennsylvania
Rhode Island
New Hampshire
Georgia
Connecticut
South Carolina
Delaware
27,808
23,471
20,166
11,259
6,703
5,422
4,489
4,096
3,345
3,271
2,713
1,908
1,823
1,515
993
Gulf States Marine Fisheries Commission
Louisiana
Texas
Alabama
Mississippi
14,682
9,173
3,277
1,524
Paciﬁc States Marine Fisheries Commission
Alaska
Washington
California
Oregon
West Coast Tribes
Hawaii
American Samoa
Alaska Tribes
Guam
Commonwealth of the Northern
Mariana Islands
49,650
49,650
18,222
15,871
5,062
4,307
2,535
993
993
993
Territory of Puerto Ricoc
993
Territory of the U.S. Virgin Islandsc
993
Total
297,902
Page 341
GAO-21-387

Source: GAO analysis of Department of Commerce data. | GAO-21-387
Note: The CARES Act appropriated $300 million to the Department of Commerce to assist ﬁshery participants. Pub. L. No.
116-136, § 12005(d), 134 Stat. at 518.
aThese three commissions were established in the 1940s. The National Oceanic and Atmospheric Administration (NOAA)
partners with them on cross-state issues related to managing shared ﬁshery resources. According to NOAA oﬃcials, these
commissions are also partnering with states in the process to disburse funds to ﬁshery participants.
bAccording to NOAA oﬃcials, allocations represent the maximum amount of total funding that ﬁshery participants in a
particular state, tribe, or territory can receive. These allocations are net of administrative fees that NOAA assessed. Additional
administrative fees can be assessed by grantees, such as the interstate marine ﬁsheries commissions, according to NOAA
oﬃcials.
cPuerto Rico and the U.S. Virgin Islands are not part of an interstate marine ﬁsheries commission.
Most of the CARES Act funding was obligated in July 2020. NOAA used these allocations to
obligate almost $297 million of the available $298 million in funding to the three interstate marine
ﬁsheries commissions from June 30 through July 2, 2020, and to Puerto Rico on July 14, 2020.
NOAA also obligated $993,000 to the U.S. Virgin Islands on November 13, 2020. The commissions
have played a role in distributing funds as part of NOAA’s ﬁshery disaster assistance program,
which provides funding to ﬁshery participants experiencing economic losses from speciﬁc events,
such as hurricanes or oil spills.525 The commissions worked with states, tribes, and territories in
their regions to develop spend plans for NOAA’s review and approval. These plans explain how
states, tribes, and territories will verify whether ﬁshery participants meet the requirements of the
CARES Act to receive funds.
According to NOAA oﬃcials, the agency is in the process of reviewing and approving spend plans
from states, tribes, and territories. NOAA oﬃcials said they expect to receive 30 spend plans from
states and territories and 30 from tribes. As of February 1, 2021, NOAA had received 29 of the
30 plans it anticipated from the states and territories. Of these 29 plans, 27 had been approved,
and 2 were under review.526 As of February 1, 2021, 30 tribal spend plans had been submitted to
NOAA; 23 of these had been approved and 7 were under review.
Once a spend plan has been approved by NOAA, the states, tribes, and territories solicit and
review applications from ﬁshery participants, determine whether participants meet the eligibility
criteria, and determine the direct payment amount based on the methodology outlined in the
spend plan.527 The respective interstate marine ﬁsheries commissions disburse the appropriate
amount of funds directly to the ﬁshery participant consistent with the approved spend plan,
though some states and tribes may disburse funds themselves.528
Most CARES Act funding had not been disbursed to ﬁshery participants as of February 1,
2021. As of February 1, 2021, three interstate marine ﬁsheries commissions had disbursed about
525The commissions, established in the 1940s, partner with NOAA on data collection and the management of ﬁsheries
resources that are shared across states, such as striped bass.
526As of February 1, 2021, NOAA was reviewing the spend plans for Alaska and Washington.
527NOAA oﬃcials said that states, tribes, and territories can also use existing records, such as ﬁshing permits, to identify
eligible recipients.
528Puerto Rico and the U.S. Virgin Islands are not part of an interstate marine ﬁsheries commission, so they will disburse
funds directly to ﬁshery participants.
Page 342
GAO-21-387

32 percent of obligated funds ($96.3 million out of the $298 million) to ﬁshery participants in 12
states and 1 tribe as shown in the table below.
Page 343
GAO-21-387

Disbursement of CARES Act Funding, as of February 1, 2021
Interstate commission
State
Funds disbursed
($ thousands)
Atlantic States Marine Fisheries Commission
Massachusetts
Maine
Virginia
Rhode Island
Connecticut
Georgia
South Carolina
Maryland
27,774
15,786
4,477
3,107
1,687
1,525
1,201
547
Gulf States Marine Fisheries Commission
Louisiana
1,968
Paciﬁc States Marine Fisheries Commission
California
Hawaii
Oregon
West Coast Tribesa
18,041
4,279
15,768
177
Total
96,307
Source: GAO analysis of Department of Commerce data. | GAO-21-387
Note: The CARES Act appropriated $300 million to the Department of Commerce to assist ﬁshery participants. Pub. L. No.
116-136, § 12005(d), 134 Stat. at 518.
aAccording to National Oceanic and Atmospheric Administration oﬃcials, one tribe from this group has received funding.
Across these three interstate commissions, we found that the percentage of funds they had
disbursed varied from 47 percent for the Atlantic States Marine Fisheries Commission to 7 percent
for the Gulf States Marine Fisheries Commission, as shown in the ﬁgure below.
Page 344
GAO-21-387

Percentage of Obligated CARES Act Funds That Have Been Disbursed to Fishery Participants by the Interstate
Fisheries Commissions, as of February 1, 2021
Note: The CARES Act appropriated $300 million to the Department of Commerce to assist ﬁshery participants. Pub. L. No.
116-136, § 12005(d), 134 Stat. at 518.
States, territories, and tribes must still review and assess applications from ﬁshery participants,
and one state spend plan has not yet been submitted to NOAA for review. Oﬃce of Management
and Budget guidance on the act discusses the importance of agencies awarding and distributing
funds in an expedient manner.529 NOAA oﬃcials reported using a more expedited process
to review spend plans, which has resulted in getting funding out to ﬁshery participants more
quickly than in past ﬁshery disasters. However, the oﬃcials acknowledged that there is not an
overall schedule for disbursing funds to ﬁshery participants since time frames are established
in individual spend plans. NOAA oﬃcials said it takes time to review spend plans to ensure they
are in compliance with the CARES Act and for states, tribes, and territories to implement these
plans—noting that each spend plan has diﬀerent time frames for submitting applications, making
award decisions, and disbursing funds.
NOAA oﬃcials said they expect the vast majority of funds to be disbursed to ﬁshery participants by
May 2021, but until recently the agency did not have centralized information on the time frames
established in individual spend plans to help ensure that funds are being disbursed expeditiously
and eﬃciently. In January 2021, we recommended that NOAA develop a mechanism to track
the progress of states, tribes, and territories in meeting timelines established in spend plans to
disburse funds in an expedited and eﬃcient manner. NOAA concurred with this recommendation.
As of February 1, 2021, the agency had developed an electronic tracking tool to track the
disbursement of funds and had begun to input data into it based on approved spend plans and
expects to update these data on a weekly basis as funds are disbursed. The agency anticipates
529Oﬃce of Management and Budget, Implementation Guidance for Supplemental Funding Provided in Response to the
Coronavirus Disease 2019 (COVID-19), (Washington D.C.: Apr. 10, 2020).
Page 345
GAO-21-387

that all current and relevant data will be input into the tracking tool by May 2021 and that data will
continue to be added to it until all funding has been disbursed.
An additional $300 million in COVID-19 relief funds was appropriated in December 2020. An
additional $300 million for certain COVID-19-related ﬁsheries disaster assistance was appropriated
under the Consolidated Appropriations Act, 2021, signed by the President into law on December
27, 2020.530 The amount provided is only to be allocated to states bordering the Atlantic, Paciﬁc, or
Arctic Oceans, the Gulf of Mexico, or the Great Lakes, as well as to territories and certain tribes.531
The act provides that of the $300 million, $30 million is for COVID-19-related ﬁshing impacts for
speciﬁed tribal ﬁshery participants, and $15 million is for COVID-19-related ﬁshing impacts to
nontribal commercial, aquaculture, processor, and charter ﬁshery participants in states bordering
the Great Lakes.532
According to NOAA oﬃcials, as of February 2021, the agency was working with the Department
of Commerce and the Oﬃce of Management and Budget on developing a plan to administer
and distribute the additional funds. They said this plan could involve states and territories using
their existing spend plans with some slight modiﬁcations. They noted that the additional funding
includes funding for states in the Great Lakes region, which did not receive CARES Act funding, and
that these states would need to submit plans for approval.
Agency Comments
We provided a copy of this enclosure to NOAA and the Oﬃce of Management and Budget
(OMB) for review and comment. NOAA provided us with technical comments, which we have
incorporated as appropriate. OMB did not provide comments on this enclosure.
Methodology
To conduct this work, we reviewed NOAA data as of February 1, 2021; examined documents on
the data system the data came from; and interviewed oﬃcials familiar with the data system.
We determined that the data were suﬃciently reliable for our purposes by reviewing agency
documents and speaking with agency oﬃcials. We also reviewed the CARES Act, the Consolidated
Appropriations Act, 2021, and agency documents, and interviewed NOAA oﬃcials.
530Pub. L. No. 116-260, div. M, tit. I, 134 Stat. 1182, 1909-10. Speciﬁcally, the act appropriated $300 million, to remain
available until September 30, 2021, to prevent, prepare for, and respond to COVID-19, domestically or internationally,
which is to be only for activities authorized under section 12005 of the CARES Act.
531With regard to tribes, the act speciﬁes that tribes eligible for funding are federally recognized tribes in any of the
nation’s coastal states and territories as well as federally recognized tribes in any of the nation’s Great Lakes states with
ﬁsheries on the tribe’s reservation or ceded or usual and accustomed territory.
532Additionally, the act provides that each eligible state and territory, other than those states bordering the Great
Lakes, is to receive an amount equal to not less than 1 percent of the total $300 million, and not greater than, from
amounts provided under the CARES Act or this appropriation, that state’s or territory’s total annual average revenue
from commercial ﬁshing operations, aquaculture ﬁrms, the seafood supply chain, and charter ﬁshing businesses.
Page 346
GAO-21-387

Contact information: Cardell Johnson, (202) 512-3146, johnsoncd1@gao.gov
Page 347
GAO-21-387

Tax Relief for Businesses
The Internal Revenue Service cannot yet determine the full extent to which businesses are taking
advantage of certain tax relief options—such as carrying additional losses back to prior tax
years—but it has disbursed approximately $11 billion in tentative refunds so far and is continuing
to process these refunds and all of the paper mail that was backlogged due to COVID-19 closures.
Entity involved: Department of the Treasury, including the Internal Revenue Service
Key Considerations and Future GAO Work
In November 2020, we recommended that the Internal Revenue Service (IRS) update the Form
1040-X instructions to include information for taxpayers on the electronic ﬁling (e-ﬁle) capability
for tax year 2019. IRS agreed with this recommendation. As of early December 2020, IRS oﬃcials
said they planned to include this information in the next routine annual update of the instructions
with a mid-2021 release, rather than updating them sooner, out of cycle. We are continuing to
monitor this action.
IRS has made progress on reducing the backlog of paper returns that resulted from COVID-19
closures. However, we continue to have concerns and are monitoring the processing of
backlogged paper refund requests. Despite the backlog, IRS had issued roughly $11 billion to
businesses in tentative Net Operating Loss (NOL) carrybacks and Alternative Minimum Tax (AMT)
credit refunds as of December 31, 2020.
Comprehensive data for all of the business provisions in the CARES Act will not begin to be
available until tax year 2020 returns have been processed. We will continue to monitor the use of
these provisions as data become available, as well as monitor IRS’s eﬀorts to ensure taxpayers’
compliance with the CARES Act.
Background
To provide liquidity to businesses during the COVID-19 pandemic, the CARES Act includes tax
measures to help businesses—including sole proprietors, estates, and trusts—reduce certain tax
obligations, which, in some cases, led to cash refunds.533 The IRS’s capacity to implement new
initiatives, such as the CARES Act tax measures, is an ongoing challenge we cited in our 2021 High
Risk Report. 534
The CARES Act modiﬁed, among other provisions of the tax law, provisions enacted as part of the
2017 legislation known as the Tax Cuts and Jobs Act (TCJA).535 The Consolidated Appropriations
Act, 2021, amended and extended some of these provisions, and expanded on a tax deduction
533Pub. L. No. 116-136, §§ 2301–2307, 134 Stat. 281, 347–359 (2020).
534 High Risk Series: Dedicated Leadership Needed to Address Limited Progress in Most High-Risk Areas. GAO-21-119SP.
Washington, D.C.: March 02, 2021.
535Pub. L. No. 115-97, 131 Stat. 2054 (2017).
Page 348
GAO-21-387

available prior to the CARES Act, among other things.536 The Joint Committee on Taxation (JCT)
estimates the following tax provisions will result in about $180 billion in foregone revenue for the
federal government in ﬁscal years 2020-2030.537 These tax provisions include the following:
• NOL carrybacks. The CARES Act requires, unless waived, carrybacks for 5 years for NOLs
arising in tax years beginning in 2018, 2019, and 2020, which may provide a cash refund for
certain taxpayers.538 Tax years prior to 2018 had a higher tax rate, so the ability of businesses
to carryback post-2018 NOLs to earlier tax years with higher taxes increases the value
of the carryback amounts. The carryback period can be waived and may aﬀect other tax
obligations.539 For NOLs arising in tax years beginning after 2017, TCJA limited the deduction
of NOL carrybacks and carryforwards to 80 percent of taxable income.540 The CARES Act
temporarily suspended the 80 percent limitation and those NOLs can reduce 100 percent of
taxable income for tax years beginning before 2021.541
The Consolidated Appropriations Act, 2021, provides a special election for farmers who
incurred an NOL composed of a farming loss in a taxable year beginning in 2018, 2019, or
2020. Such farmers may elect to not apply the CARES Act NOL amendments regarding the
temporary suspension of the 80-percent NOL deduction limitation and the 5-year carryback
period.542 This allows farmers who deducted a 2-year net operating loss carryback prior to
the CARES Act to elect to retain that 2-year carryback rather than claim the 5-year carryback
provided in the CARES Act.543
Taxpayers who have amounts included in their income because of the transitional repatriation
tax established in the TCJA (referred to as “section 965” tax), can elect to exclude those
inclusion years from the carryback period to produce an NOL refund in other years.544 NOL
536Pub. L. No. 116-260, div. N, §§ 271–288, div. EE, §101–306, 134 Stat. 1182, 1964–1993, 3038–3082 (2020).
537This is an updated estimate to include the $6.3 billion for the meal deduction provision included in the Consolidated
Appropriations Act, 2021.
538Pub. L. No. 116-136, § 2303, 134 Stat. at 352–356. An NOL occurs when a taxpayer's allowable deductions exceed
its gross income for a tax year. During an NOL year, a taxpayer generally does not owe any income taxes. TCJA
generally repealed NOL carrybacks and required NOLs to be carried over indeﬁnitely. Pub. L. No. 115-97, § 13302(b),
131 Stat. at 2122. The NOL oﬀsets the taxpayer's taxable income in other tax years. 26 U.S.C. § 172(a). For ease of
reporting, we use the term taxpayer to refer to an entity that may use the CARES Act tax relief provisions described
in this enclosure.
539NOLs must be carried back unless taxpayers make a valid election to waive the carryback. 26 U.S.C. § 172(b)(3).
540Pub. L. No. 115-97, § 13302(a)(1), 131 Stat. at 2121.
541Pub. L. No. 116-136, § 2303(b)(1), 134 Stat. at 353–354. Losses carried forward can reduce future taxable income
and tax, but cannot reduce taxable income below zero.
542Pub. L. No. 116-260, div. N, § 281(a), 134 Stat. at 1983. Farmers that, prior to the date of enactment of the
Consolidated Appropriations Act, 2021, had ﬁled federal income tax returns that disregard the CARES Act NOL
amendments are generally treated as having made that election. Farmers are also allowed to make an aﬃrmative
election to disregard the CARES Act NOL amendments.
543The CARES Act also allows farmers who previously waived an election to carry back a net operating loss to
revoke the waiver.
54426 U.S.C. § 965. Corporations that elect to exclude the transition tax years from the carryback period may receive
a higher refund. 26 U.S.C. § 172(b)(1)(D)(iv), (v).
Page 349
GAO-21-387

carryback refunds are typically claimed on Form 1120-X, an Amended U.S. Corporation Income
Tax Return; paper Form 1139, Corporate Application for Tentative Refund; or paper Form 1045,
Application for Tentative Refund (for individuals, including sole proprietors, estates and trusts).
From April to December 31, 2020, IRS implemented temporary procedures to allow for e-fax of
Forms 1139 and 1045 for a quick tentative refund during the period that IRS campuses were
closed and mail was not being processed due to COVID-19.545
• Acceleration of AMT Credit refunds. TCJA repealed the corporate AMT, but most corporations
could claim their excess unused minimum tax credits as a refundable credit for tax years 2018
through 2021.546 Under the CARES Act, corporations with AMT credits may claim a refund for
tax years beginning in 2018 and 2019 and may either ﬁle Form 1139 or Form 1120-X to receive
a refund for some or all of these credits.547
• Increased limits on business interest. For tax years beginning in 2019 and 2020, taxpayers may
generally deduct business interest expense in amounts not to exceed the sum of (1) the
taxpayer’s business interest income, (2) 50 percent of their adjusted taxable income for the
tax year, and (3) their ﬂoor plan ﬁnancing interest for the tax year.548 Taxpayers may also
elect to use 2019 adjusted taxable income in computing their 2020 business interest expense
deduction. Businesses may choose not to elect to use 2019 adjusted taxable income in 2020,
to calculate their 2020 business interest expense deduction, as it may aﬀect other credits or
deductions.
• Excess business losses. For taxpayers other than C corporations—such as partnerships and
sole-proprietors—the limit that TCJA enacted on excess business losses is removed for tax
545Corporations ﬁle Form 1139, Corporation Application for Tentative Refund. Individuals, estates, and trusts ﬁle
Form 1045, Application for Tentative Refund. See: IRS, Temporary procedures to fax certain Forms 1139 and 1045
due to COVID-19, accessed February 10, 2021, https://www.irs.gov/newsroom/temporary-procedures-to-fax-certain-
forms-1139-and-1045-due-to-covid-19 .
546Pub. L. No. 115-97, § 12001(a), 131 Stat. at 2092. Prior to TCJA, corporations were required to calculate their
tax liability under two sets of rules—they computed their regular tax liability and their tentative AMT liability and
paid whichever was greater. If the tentative AMT was more than the regular tax, the diﬀerence between them was
AMT. The purpose of the AMT was to prevent companies from eliminating their tax liability from overuse of certain
corporate tax preferences. In general, AMT applied a lower tax rate to a broader tax base by limiting the use of tax
preferences and disallowing credits and deductions.
547Pub. L. No. 116-136, § 2305, 134 Stat. at 357. Under the CARES Act, corporations with AMT credits in excess
of the credit allowed to oﬀset regular tax liability (excess credit) may claim 50 percent of the excess credit as a
refundable credit for the ﬁrst tax year beginning in 2018 and then claim any remaining excess credit as a refundable
credit in 2019. Alternatively, a taxpayer may elect to claim the entire excess credit as a refundable credit in the tax
year beginning in 2018. If a corporation elects to claim all of the excess credit as a refundable credit in 2018, the
corporation may use Form 1139 to receive a refund for this credit. If a corporation does not ﬁle Form 1139 to make
this election, it may ﬁle a Form 1120-X to make the election and obtain a refund.
548Pub. L. No. 116-136, § 2306, 134 Stat. at 358. TCJA limited the business interest expense deduction to the sum
of interest income, 30 percent of adjusted taxable income and ﬂoor plan ﬁnancing interest expense. Pub. L. No.
115-97, § 13301, 131 Stat. at 2117. Businesses may elect to be governed by the TCJA’s 30 percent limit instead, as it
may aﬀect other credits and deductions. The higher limitation does not apply to partnerships until tax year 2020,
and special rules apply to partnerships for tax years beginning in 2019.
Page 350
GAO-21-387

years 2018-2020.549 Taxpayers that applied the TCJA limits to any excess business loss that
arose during the 2018 or 2019 tax year, or during both tax years, can ﬁle amended returns to
claim refunds. The American Rescue Plan Act of 2021, enacted March 11, 2021, extends the
limitation on excess business losses.550 We will continue to monitor the implementation of this
provision.
• Business meal deduction. Before the Consolidated Appropriations Act, 2021 was enacted,
taxpayers could generally deduct a maximum of 50 percent of the ordinary food and beverage
expenses associated with operating a trade or business. The new law removed the 50 percent
limitation, allowing taxpayers to deduct the full expenses for food or beverages provided by a
restaurant that are incurred after December 31, 2020, and before January 1, 2023.551
Overview of Key Issues
Update on the status of tentative refunds. Complete data on the number of taxpayers taking
advantage of these tax provisions will not be available until after tax year 2020 income tax returns
are processed at the earliest in late in 2021. However, initial data are available on applications for
and payments of tentative refunds related to NOL carrybacks and AMT credits. The table below
shows information on tentative refund requests received via the temporary e-fax line, which
closed on December 31, 2020. IRS has received more than 41,000 NOL carryback and AMT credit
refund applications via e-fax. IRS had approved roughly $14 billion and dispersed roughly $11
billion of tentative refunds, as of December 31, 2020.
549CARES Act, § 2304, 134 Stat. at 356. An excess business loss is the amount by which the total deductions from
all trades or businesses exceed a taxpayer’s total gross income and gains from those trades or businesses, plus
$250,000 ($500,000 for a joint return). 26 U.S.C. § 461(I)(3)(A).
550Pub. L. No. 117-2, § 9041, 135 Stat. 4, 122.
551Pub. L. No. 116-280, div. EE, § 210, 1182 Stat. at 3066.
Page 351
GAO-21-387

CARES Act Net Operating Loss (NOL) Carryback and Alternative Minimum Tax (AMT) Credit Tentative Refund E-
fax Cases, as of December 31, 2020
Form and provision
Cases Received via E- fax
a
Number of taxpayers ﬁling
Number of cases in
suspense b
Form 1139, AMT only
1,134
907
30
Form 1139, NOL or AMT
18,124
15,842
229
Form 1045, NOL
22,051
18,750
53
Totals
41,309
35,499
312
Source: GAO analysis of Internal Revenue Service data. | GAO-21-387
Notes: The temporary procedures to e-fax these forms ended on December 31, 2020, and forms received through those lines
are still being processed and approved.
aA single case may include multiple e-fax submissions. Submissions for the same identiﬁcation number, form, and tax period
generally are one case. Submissions for the same number and form, but for diﬀerent tax periods, are separate cases.
bA case is in suspense because additional information is needed.
In late January, IRS oﬃcials said they had also received 12,135 NOL carryback and AMT credit
refund applications on paper Forms 1139 and 1045, and 4,921 via amended returns. However, IRS
oﬃcials said they are unable to determine whether the paper Forms 1139 and 1045 and amended
returns are CARES Act speciﬁc.552 As of December 31, 2020, 312 Forms 1045 and 1139 received
via e-fax were still in suspense, which according to IRS oﬃcials, could be because IRS is awaiting a
processed amended return, or because of other reasons.553
Size of received and approved refunds. As we reported in November, according to IRS oﬃcials,
they are still extracting pertinent data from the tentative refund applications so that actual dollar
amounts claimed may be reported. When a refund application is received via e-fax, IRS initially
groups it by the total dollar amount of the claim, providing us with high level information on the
ranges of refunds claims by dollar group. (See table.)
552Tentative refunds are available for other reasons before the CARES Act was enacted, and IRS cannot distinguish
whether paper forms were submitted for CARES Act claims or for other reasons.
553There may be additional Form 1045 and 1139 in suspense that were received via paper, but we were not able to
collect data on this.
Page 352
GAO-21-387

Number and Approval Rate of CARES Act Applications for Tentative Refunds Received on Forms 1139 and 1045
via E-fax, by Refund Amount, as of December 31, 2020
Size of Refund a
Form 1139
received b
Number of
approved
refunds from
Form 1139
Form 1139
approval rate c
Form 1045
received
Number of
approved
refunds from
Form 1045
Form 1045
approval rate
$0 to $4,999
3,642
2,782
76%
3,806
3,165
83%
$5,000 to $99,999
7,115
5,083
71%
11,716
7,126
61%
$100,000 to $999,999
4,118
2,542
62%
5,728
2,400
42%
> $1Million
2,115
1,000
47%
793
218
27%
Source: Internal Revenue Service data and GAO analysis. | GAO-21-387
Note: A single case may include multiple e-fax submissions. Submissions for the same identiﬁcation number, form, and tax
period generally are one case. Submissions for the same number and form, but for diﬀerent tax periods, are separate cases. A
business can submit more than one application.
a In this table, the size of refund is determined by the dollar group it falls into when an application is received via e-fax.
b Form 1139 is a Corporation Application for Tentative Refund and Form 1045 is an Application for Tentative Refund
c To calculate this approval rate, we divided the number of approved refunds from Form 1139 by the number of Form 1139
applications received for each of the refund size categories. We did the same for Form 1045 in the last column of the table.
The table above shows that approval rates decrease as the size of refunds increase. About 48
percent of the Forms 1045 and 1139 received between March 27, 2020 and December 31, 2020
were for refunds between $5,000 and $99,999. Of the approved refunds over $1 million, about 82
percent were from Form 1139, which are ﬁled by corporations as opposed to businesses such as
sole proprietors and partnerships that ﬁle Form 1045.554
Refund claims in excess of $2 million must be reported to the Joint Committee on Taxation (JCT)
for review. 555 According to IRS data, 426 refund applications have been subject to this review
between April 6, 2020 and February 25, 2021. IRS oﬃcials said that these refund claims can take
about 70 days for the IRS Joint Committee Specialists to review, and that IRS increased the staﬃng
for the program that processes claims subject to JCT review in late 2020.556 IRS oﬃcials said they
moved to transmitting these cases electronically between IRS and JCT as of April 6, 2020, to help
expedite the process.
554 We calculated this percentage by dividing the number of approved applications for tentative refund over $1 million
for Form 1139 by the total number of approved applications for tentative refund over $1 million for both Forms 1139
and 1045.
555Generally, the IRS cannot issue refunds over $2 million ($5,000,000 in the case of a C corporation) until 30 days after
reporting them to JCT. 26 U.S.C. § 6405(a). In the case of a refund for net operating loss carrybacks, IRS reports to the
Joint Committee on Taxation after the refund is made. 26 U.S.C. § 6405(b).
556 IRS oﬃcials said that most of the 70 days includes processing and review on the IRS side, which includes the IRS’s
Joint Committee Specialists reviewing the examiner’s case ﬁles for procedural, computational, and technical accuracy,
and preparing the report that is submitted to the JCT for their review. The JCT generally only takes a few days to review
the refund once the IRS refers it to them.
Page 353
GAO-21-387

Update on processing of paper ﬁlings. COVID-19 caused IRS facilities to shut down and the
subsequent large-scale staﬃng changes prevented the timely opening and processing of paper
returns, including Form 1040-X. IRS processing centers re-opened in June 2020 and IRS oﬃcials
said they have been processing mail in the order of receipt while operating at partial capacity to
accommodate social distancing. IRS oﬃcials said that they had opened all of the backlogged paper
mail as of December 18, 2020. However, as of March 2021, IRS oﬃcials said weather-related issues
and the arrival of end of year returns on paper caused another mail backlog.557 As of March 6,
2021, the backlog of unopened mail was 1.6 million returns, a decrease of 425,000 compared to
the previous week, according to IRS oﬃcials.
Even when the paper mail is opened, it takes time to get those returns processed. In late January,
IRS oﬃcials said 15.7 million individual and business tax returns were opened, but still waiting to
be processed.558 In some locations, IRS is still processing returns dated as early as July 15, 2020.
IRS oﬃcials said they do not have a target date for processing all backlogged returns, but they
continue to monitor available staﬃng. They expected that more employees would return to the
oﬃce in February to help with the backlog
This processing backlog aﬀects the processing of tentative refund applications as well. As we
reported in November 2020, some taxpayers need to ﬁle an amended income tax return (generally
a 1040-X for individual taxpayers, including sole proprietors) before using e-fax to ﬁle Forms
1139 and 1045. However, due to system limitations, if the taxpayer ﬁled a paper Form 1040, that
taxpayer would not be able to e-ﬁle Form 1040-X.559
The paper backlog is preventing IRS from processing paper-ﬁled Forms 1040-X for tax year 2018
and 2019 in a timely manner, according to IRS oﬃcials. There were 1.3 million Forms 1040-X
waiting to be processed as of February 11, 2021. Paper applications for tentative refunds may
also be held up in this backlog, now that the temporary e-fax line for ﬁling Forms 1139 and 1045
has closed, making applications for NOL carrybacks and AMT credits received by paper harder to
obtain in a timely manner.
Agency Comments
We provided IRS, Treasury, and the Oﬃce of Management and Budget with a draft of this
enclosure. IRS’s written comments are reproduced in appendix VIII. IRS also provided technical
comments, which we incorporated as appropriate. The Oﬃce of Management and Budget and
Treasury did not have any comments on this enclosure.
557 According to IRS oﬃcials, IRS processing centers see increases in returns around due dates every year, but the IRS
did not track these backlogs prior to the pandemic and is unable to provide any prior year data for comparison.
55815.7 million is 2.6 million more returns than what IRS reported in December 2020 and what GAO reported in
GAO-21-251, which discusses the IRS backlog in greater length and detail.
559The electronic ﬁle capability for the 1040-X is only for tax years 2019 and on. Taxpayers who needed to ﬁle an
amended return for tax year 2018, would have had to do so on paper.
Page 354
GAO-21-387

Methodology
We reviewed IRS data as of December 31, 2020, federal laws, and agency guidance; and
interviewed IRS oﬃcials. To analyze IRS data, we obtained guidance from IRS and Treasury on the
appropriate methodology to conduct the data analysis, extracted the relevant data sets from IRS
databases, and processed our results. We determined that the data were suﬃciently reliable for
our purposes.
Contact information: Jessica Lucas-Judy, (202) 512-6806, lucasjudyj@gao.gov
Page 355
GAO-21-387

FEMA’s Disaster Relief Fund and Assistance to Tribal
Governments
We are concerned about the Federal Emergency Management Agency’s lack of personnel needed
to engage eﬀectively with tribal governments, as well as the demands on the Disaster Relief
Fund to eﬀectively respond to the COVID-19 pandemic, considering the increasing amounts to be
reimbursed to state, local, tribal, and territorial governments.
Entities involved: Federal Emergency Management Agency, within the Department of Homeland
Security
Recommendations for Executive Action
The Federal Emergency Management Agency Administrator should adhere to the agency’s
protocols listed in the updated 2019 Tribal Consultation Policy by obtaining tribal input via the four
phases of the tribal consultation process when developing new policies and procedures related to
COVID-19 assistance.
The Federal Emergency Management Agency Administrator should provide timely and consistent
technical assistance to support tribal governments’ eﬀorts to request and receive Public
Assistance as direct recipients, including providing additional personnel, if necessary, to ensure
that tribal nations are able to eﬀectively respond to COVID-19.
The Department of Homeland Security concurred with both of our recommendations.
Key Considerations and Future GAO Work
In November 2020, we reported that the Federal Emergency Management Agency’s (FEMA)
Disaster Relief Fund—the primary source of federal disaster assistance for state, local, tribal,
and territorial governments—had never before been used during a nationwide public health
emergency on the scale of the COVID-19 pandemic. In March 2020, the CARES Act appropriated
$45 billion to the Disaster Relief Fund, and in March 2021, the American Rescue Plan Act of 2021
appropriated $50 billion to the Disaster Relief Fund.560 FEMA has used the Disaster Relief Fund
to respond to the COVID-19 pandemic by providing lost wages assistance and crisis counseling
services to individuals, and by awarding Public Assistance grants. Through Public Assistance
grants, FEMA reimburses states, local, tribal, and territorial governments for pandemic-related
costs, such as for testing supplies, personal protection equipment, National Guard activities, and
vaccine distribution, among other things.
560CARES Act, Pub. L. No. 116-136, tit. VI, 134 Stat. 281, 543 (2020); American Rescue Plan Act of 2021, Pub. L. No. 117-2,
§ 4005, 135 Stat. 4, 79.
Page 356
GAO-21-387

At that time, we noted that the number of concurrent demands on the Disaster Relief Fund and
the unpredictability of any future response needs raise questions about funding availability for
COVID-19 and a signiﬁcant number of active disasters in diﬀerent stages of recovery.561
For example, in 2020, in addition to providing COVID-19 assistance to respond to 58 major disaster
declarations (in every U.S. state, the District of Columbia, territory, and two tribal nations), FEMA
responded to assist with a record-setting number of hurricanes on the East Coast and with
wildﬁres in the western U.S.562
We will continue to monitor the Disaster Relief Fund as part of our continued work on the
nationwide pandemic, disaster response and recovery work, and the nation’s ﬁscal health.
Background
As of February 28, 2021, the Disaster Relief Fund balance was over $17 billion, which is an
estimated 79 percent decrease from March 2020 at the start of COVID-19 (see ﬁgure), and FEMA
projected at the time that the balance for the remainder of ﬁscal year 2021 would decrease to a
deﬁcit of over $22 billion.563
561The Disaster Relief Fund receives an annual appropriation and has routinely received supplemental appropriations.
In March 2020, the CARES Act was enacted, appropriating $45 billion for the Disaster Relief Fund. Pub. L. No. 116-136,
div. B, tit. VI, 134 Stat. 281, 543 (2020). The Consolidated Appropriations Act, 2021, appropriated $17 billion to the
Disaster Relief Fund for major disasters and an additional $2 billion to provide assistance for COVID-19 related funeral
expenses. Pub. L. No. 116-260, div. F, tit. III, 134 Stat. 1182, 1462 (2020); Pub. L. No. 116-260, div. M, tit. II, 134 Stat. at
1910. In March 2021, the American Rescue Plan Act of 2021 appropriated $50 billion to the Disaster Relief Fund. Pub. L.
No. 117-2, § 4005, 135 Stat. at 79.
562Under the Robert T. Staﬀord Disaster Relief and Emergency Assistance Act (Staﬀord Act), the President may declare
that a major disaster exists in response to a Governor’s or tribal chief executive’s request if the disaster is of such
severity and magnitude that eﬀective response is beyond the capabilities of a state, tribe, or local government and
federal assistance is necessary. See 42 U.S.C. § 5170.
563The projected obligations for the remainder of ﬁscal year 2021 are primarily a result of increased estimates
resulting from cost share adjustments, vaccine distribution initiatives, and additional National Guard needs, as well as
continuing increases in other COVID-19 requirements, as of January 2021. Other initiatives such as the safe re-opening
and operation of eligible schools, transit systems, and other facilities are not included in these estimates and would
substantially increase obligations from the Disaster Relief Fund. We will continue to monitor and report on FEMA’s
projections for the Disaster Relief Fund balance in the coming months.
Page 357
GAO-21-387

FEMA Disaster Relief Fund Balance by Month, February 2020 through February 2021
Note: In March 2021, the American Rescue Plan Act of 2021 appropriated $50 billion to the Disaster Relief Fund to support
FEMA’s costs associated with major disaster declarations. American Rescue Plan Act of 2021, Pub. L. No. 117-2, § 4005, 135 Stat.
4, 79.
FEMA has used the Disaster Relief Fund to respond to the COVID-19 pandemic by providing
three primary types of disaster assistance: (1) Public Assistance grants, (2) Individual Assistance,
and (3) mission assignments. For natural disasters, Public Assistance grants tend to be used for
emergency cleanup and for permanent reconstruction projects, for example, to rebuild damaged
public infrastructure. FEMA typically provides 75 percent of the costs, while state, local, territorial
and tribal entities cover 25 percent. FEMA’s Individual Assistance program provides assistance to
disaster survivors to cover necessary expenses and serious needs—such as housing assistance,
counseling, or child care—which cannot be met through insurance or low-interest loans. FEMA
also issues mission assignments—work orders directing other federal agencies to provide direct
assistance to state, local, tribal, and territorial governments—to support disaster response and
recovery.
In addition, federally recognized Indian tribal governments have the option to request a
presidential emergency or major disaster declaration and become a direct recipient of federal
assistance or may elect to become a subrecipient under a state declaration.564 Additional
administrative requirements apply to direct recipients, such as developing a FEMA-approved
administrative plan that describes how the tribal entity intends to administer Public Assistance
564The Sandy Recovery Improvement Act of 2013 amended the Staﬀord Act to provide tribal governments the option
to request a presidential emergency or major disaster declaration. 44 U.S.C. §§ 5170(b), 5191(c). A tribal government
may also receive one type of assistance under a state or territorial declaration and another type of assistance under its
own declaration, provided there is no duplication of beneﬁts. The tribal government cannot receive the same type of
assistance through both tribal and state declarations for the same incident.
Page 358
GAO-21-387

funds.565 FEMA policy states that FEMA personnel are available to provide technical assistance
to tribal governments seeking Public Assistance as direct recipients to meet the administrative
requirements, including for the COVID-19 response.566 FEMA updated its tribal consultation policy
in 2019 specifying steps that the agency should take in consulting with tribes when developing
new policies or procedures.567
Overview of Key Issues
FEMA’s use of the Disaster Relief Fund to support COVID-19 activities increased in early
2021. FEMA currently uses the Disaster Relief Fund to fund the three programs mentioned
above—(1) Public Assistance; (2) Individual Assistance; and (3) mission assignments, among
others––as part of the agency’s COVID-19 response.568 As of February 28, 2021, FEMA had
obligated over $62 billion from the Disaster Relief Fund to respond to COVID-19. The ﬁgure below
shows FEMA’s obligations for COVID-19 by program and activity.
Disaster Relief Fund Obligations and Projections for COVID-19 by Program and Activity through March 2021
Note: This ﬁgure includes estimated obligations that FEMA projected for March 2021.
• Individual Assistance . The Crisis Counseling Assistance and Training program assists individuals
and communities in recovering from the psychological eﬀects of natural- and human-caused
56544 C.F.R. § 206.207(b).
566FEMA, Tribal Declarations Pilot Guidance, January 2017.
567FEMA Policy Number 101-002-02, Tribal Consultation Policy, July 2019.
568FEMA continues to play a key role in the ongoing COVID-19 pandemic response eﬀort, including distributing personal
protective equipment, supporting Defense Production Act activities, and providing incident management coordination
and leadership.
Page 359
GAO-21-387

disasters through community-based outreach and educational services.569 According to
FEMA oﬃcials, FEMA had provided about $408 million in support of the Crisis Counseling
and Training program for COVID-19, as of March 8, 2021. In addition, on August 8, 2020,
President Trump issued a presidential memorandum that directed that up to $44 billion
be made available from the Disaster Relief Fund to provide Lost Wages Assistance to
supplement unemployment insurance compensation.570 Further, in December 2020, Congress
appropriated $2 billion to the Disaster Relief Fund for eligible funeral expenses for individuals
or households with COVID-19-related funeral expenses.571 As of February 2021, FEMA was
developing its program to provide this assistance.
• Public Assistance . For all 58 major disaster declarations for COVID-19, FEMA has authorized
Public Assistance grants for emergency protective measures only. This may include eligible
medical care, purchase and distribution of food, non-congregate medical sheltering, operation
of Emergency Operations Centers, and the purchase and distribution of personal protective
equipment. On February 2, 2021, the President issued a presidential memorandum that
directed FEMA to fully reimburse states, territories, and tribes for all work eligible for
assistance under Category B.572
FEMA oﬃcials stated that previous Public Assistance policy was limited to funding response
activities and did not extend to operational costs at facilities. However, a January 21, 2021
Presidential memorandum expanded the deﬁnition of eligible goods and services under
FEMA’s Public Assistance program to include the costs of opening and operating facilities
such as schools, domestic violence shelters, transit systems, and others and may include
the funding for the provision of personal protective equipment and disinfecting services
and supplies.573 According to FEMA oﬃcials, the memorandum will likely have a signiﬁcant
impact on their resources and operations. Speciﬁcally, FEMA oﬃcials stated that the eligibility
569See 42 U.S.C. § 5183; 44 C.F.R. § 206.171. When states or tribal entities request major disaster declarations,
they may request assistance under the Crisis Counseling Assistance and Training program. Likewise, when the
President makes a major disaster declaration, the declaration may authorize FEMA’s Individual Assistance program,
which may also include the Crisis Counseling Assistance and Training program. On April 28, 2020, President Trump
delegated authority to approve the Crisis Counseling Assistance and Training program for COVID-19 pandemic-
related disasters to the FEMA Administrator for disasters declared prior to that date.
570The White House, Memorandum on Authorizing the Other Needs Assistance Program for Major Disaster Declarations
Related to Coronavirus Disease 2019 (Aug. 8, 2020). Pursuant to the presidential memorandum, upon receiving a
FEMA grant, states and territories may provide eligible claimants $300 or $400 per week—which includes a $300
federal contribution—in addition to their Unemployment Insurance beneﬁts. The presidential memorandum
directed that the program would end when $44 billion had been obligated; the balance of the Disaster Relief Fund
reached $25 billion; on December 27, 2020; or upon the enactment of legislation providing supplemental federal
unemployment compensation, whichever comes ﬁrst.
571Pub. L. No. 116-260, div. M, tit. II, 134 Stat. at 1910.
572White House, Memorandum on Maximizing Assistance from the Federal Emergency Management Agency, February 2,
2021.
573White House, Memorandum to Extend Federal Support to Governors’ Use of the National Guard to Respond
to COVID-19 and to Increase other Federal Assistance Provided to States, January 21, 2021. The February 2, 2021
Presidential memorandum authorizes 100 percent cost share reimbursement for work eligible under Public
Assistance Category B from January 20, 2020 through September 30, 2021, except for the operational expenses
made eligible by the January 20, 2021 memorandum, discussed above, which receive 100 percent cost share
reimbursement from January 21, 2021 through September 30, 2021.
Page 360
GAO-21-387

of reopening and operating expenses for schools and other facilities is likely to signiﬁcantly
increase the number of applicants and cost of eligible claims under Public Assistance.
• Mission assignments . The presidential memorandum issued on January 21, 2021 provided that
FEMA would fully reimburse expenses for National Guard activities to respond to COVID-19,
which may include vaccination distribution.574 According to FEMA, the estimated cost is over
$3 billion for National Guard assistance as of February 2021.
As of February 2021, FEMA, through its National Response Coordination Center and 10 regional
oﬃces across the nation, was coordinating with other federal agencies to meet state, tribal, and
territory needs to support the distribution of COVID-19 vaccines. In addition, FEMA is deploying
additional personnel to vaccination sites where they will assist people obtaining the vaccine.
As of March 9, 2021, FEMA oﬃcials stated that it obligated almost $4 billion to states, tribes,
and territories, and to Washington, D.C. for vaccine distribution.575 According to FEMA oﬃcials,
assistance for vaccine distribution may include but is not limited to:
• Leasing facilities or equipment to administer and store the vaccine;
• Staﬃng and training support;
• Providing personal protective equipment and other administrative supplies; and
• Using technology to register and track vaccine administration.
As of February 28, 2021, FEMA estimated that the obligation rate for COVID-19 will increase in
March 2021 given the issuance of the presidential memorandum directing FEMA to retroactively
reimburse states, locals, tribes, and territories at 100 percent of the costs for eligible emergency
protective measures such as for masks, gloves, and emergency feeding actions.
FEMA did not consult with tribal entities in advance of issuing its policy on eligible Public
Assistance costs early in the COVID-19 pandemic. In May 2020, multiple tribal associations
reported that the Department of Homeland Security and FEMA did not formally consult with
tribes for COVID-19 pandemic policies that have tribal implications.576 Speciﬁcally, at the National
Congress of American Indians in January 2021, tribal leaders voiced concerns over the continued
lack of timely and consistent tribal consultation during the COVID-19 pandemic.
574White House, Memorandum to Extend Federal Support to Governors’ Use of the National Guard to Respond to
COVID-19 and to Increase other Federal Assistance Provided to States, January 21, 2021.
575FEMA oﬃcials stated that the almost $4 billion had been obligated through the Public Assistance program.
576Letter to Senators Mitch McConnell and Chuck Schumer on COVID-19 recovery legislative proposals (phase 4), May
26, 2020. The following tribal associations signed the letter: the Association on American Indian Aﬀairs, the Inter-Tribal
Emergency Management Coalition of Oklahoma, National Congress of American Indians, National Tribal Emergency
Management Coalition, North West Tribal Emergency Management Council, Montana Tribal Emergency Management
Council, Tribal Emergency Management Association, and United South and Eastern Tribes Sovereignty Protection Fund.
Page 361
GAO-21-387

Further, representatives from two tribal entities we interviewed reported that they did not have
the opportunity to provide input to FEMA’s policy on the types of COVID-19-related items or
activities that would be considered eligible for reimbursement under the Public Assistance for
COVID-19 and not having the opportunity to do so made it more diﬃcult to make decisions on
behalf of their tribe. For example, one tribal representative stated in the early months of the
COVID-19 pandemic that tribal government employees were considered emergency workers
and therefore were eligible to receive reimbursement for masks, but FEMA later restricted the
reimbursement to ﬁrst responders and health care workers only. As a result, the restriction meant
that tribal government personnel who were performing critical functions to respond to COVID-19,
such as monitoring incoming traﬃc at various tribal checkpoints, were no longer eligible to receive
the reimbursement for masks under the revised policy.
In 2019, FEMA issued its Tribal Consultation Policy, which speciﬁes the process for how FEMA
engages with tribal governments in regular and meaningful consultation and collaboration on
actions that have tribal implications (see ﬁgure below).577
Overview of FEMA’s Tribal Consultation Policy Process
Speciﬁcally, the policy states that FEMA commits to an inclusive and collaborative tribal
consultation process that provides tribal governments’ suﬃcient time to submit input on actions
that have tribal implications. This includes considering tribal input on actions that have tribal
implications and following up with tribes on the ﬁnal decision about how input was utilized. FEMA
did not follow the tribal consultation process while developing an interim policy detailing eligible
items for reimbursement under Category B of the Public Assistance program.
Although FEMA oﬃcials agreed that the interim policy clarifying eligible items under the Public
Assistance program has tribal implications, the agency did not formally consult with tribes while
developing the policy. Doing so would have allowed tribes the opportunity to provide meaningful
input before FEMA issued the policy in September 2020. As a result, FEMA issued an interim policy
clarifying the types of items and activities eligible for COVID-19 Public Assistance items without
tribal input.
In December 2020, FEMA hosted a listening session for tribal entities seeking tribal input three
months after the policy had already been issued. According to FEMA oﬃcials, they did not have the
time to formally consult with tribes prior to issuing the interim policy due to the expedited nature
of that policy and the immediate need to respond to questions from states, tribes, territories,
and localities. Nevertheless, FEMA’s Tribal Consultation policy states that FEMA is committed to
strengthening its nation-to-nation relationship and consultation eﬀorts with tribal governments by
577FEMA Policy Number 101-002-02, Tribal Consultation Policy, July 2019.
Page 362
GAO-21-387

collaborating and communicating early in the process to exchange information, receive input, and
consider the views of tribes on actions that have tribal implications. If tribes had been formally
consulted earlier in the process, they could have been in a better position to provide input to
FEMA on how its policy might impact tribes. Further, there may have been less confusion on which
items were considered eligible for reimbursement during the early months of the pandemic, and
tribes could have made more informed decisions.
FEMA has not provided timely and consistent technical assistance to tribal governments,
so tribes may be missing opportunities to receive Public Assistance as direct recipients for
the COVID-19 pandemic. As of February 2021, FEMA reported that 60 percent of the 574 tribes
were working with FEMA to receive Public Assistance for COVID-19, either as direct recipients or
subrecipients. Tribal organization representatives told us that tribes may prefer to request Public
Assistance as a direct recipient rather than as a subrecipient because (1) states do not always
distribute assistance to tribes in a timely manner, (2) tribes may not have a positive relationship
with the state, and (3) tribes may not want to sign a waiver that they believe could limit their rights
as a sovereign entity. Conversely, tribes may decide to be a subrecipient through a state if they do
not have the capacity or emergency management expertise to fulﬁll administrative requirements
necessary to be direct recipients.
Several tribal organizations reported challenges related to completing administrative requirements
to request and receive Public Assistance as a direct recipient during the pandemic––requirements
such as activating an emergency operations plan and submitting a tribal Public Assistance
Administrative Plan.578 While some FEMA regions have not required the plan to be completed
before distributing grant funding to tribal nations, other regions have not been as ﬂexible with
tribal needs. Moreover, some tribal nations have reported that certain FEMA regions have added
region-speciﬁc requirements to their application process, thereby creating some inconsistency
in how these requirements are administered throughout the FEMA regions.579 While tribal
representatives reported that some tribal nations received technical assistance, many other
tribal nations were given little or no technical assistance when they requested support. Two
tribal oﬃcials told us that when requesting technical assistance from FEMA to help with disaster
activities, such as developing a Public Assistance Administrative Plan, FEMA did not have staﬀ to
assist.
In its 2020 report to the Administrator, FEMA’s National Advisory Council raised tribal capacity as
a signiﬁcant issue.580 For example, the National Advisory Council recommended that in addition
to increasing FEMA staﬀ, FEMA should conduct a thorough survey of emergency management
capabilities to gather speciﬁc information on the number of full-time emergency management
578We have previously reported on the administrative challenges tribal nations have faced in the past when requesting
federal assistance for a major disaster or emergency.
579Letter to Senators Mitch McConnell and Chuck Schumer on COVID-19 legislative recovery proposals (phase 4), May
26, 2020. The following tribal associations signed the letter: the Association on American Indian Aﬀairs, the Inter-Tribal
Emergency Management Coalition of Oklahoma, National Congress of American Indians, National Tribal Emergency
Management Coalition, North West Tribal Emergency Management Council, Montana Tribal Emergency Management
Council, Tribal Emergency Management Association, and United South and Eastern Tribes Sovereignty Protection Fund.
580 FEMA, National Advisory Council November 2020 Report to the Administrator (Washington, D.C.: November 2020).
Page 363
GAO-21-387

staﬀ in each tribal nation, their grant management capacity, their planning capacity, and other key
resilience factors by January 2022.
FEMA stated that the agency has provided tribal relations personnel on an as-needed basis to
provide technical assistance, but acknowledged that the number and expertise of tribal relations
personnel varied throughout the regions and that the level of support was likely inconsistent. See
ﬁgure below for the ratio of FEMA tribal relations personnel to tribal nations by FEMA region.
Ratio of FEMA Tribal Relations Personnel to Tribal Nations by FEMA Region as of February 2021
Note: Two tribes, the Seminole Tribe of Florida and the Navajo Nation, are direct recipients with a major disaster and an
emergency declaration.
In its initial assessment report of its response to the pandemic, FEMA noted challenges and
recommended that the agency develop a tribal nation engagement strategy. FEMA reported
that the strategy should include providing the resources and personnel throughout each
region required to support program delivery for all tribal nations, particularly to improve tribal
emergency management programs related to low-frequency, high-impact events such as
Page 364
GAO-21-387

pandemics.581 As of March 2021, FEMA had not developed this strategy, but planned to develop
the strategy and implementation timeline by June 2021.
Given tribes’ limited capacity to fulﬁll administrative requirements related to the COVID-19
Public Assistance process, tribes are likely to beneﬁt from technical assistance as they develop
documents and other information related to their request for Public Assistance. FEMA’s Tribal Pilot
Guidance states that tribes may request technical assistance from FEMA to develop a disaster-
speciﬁc Public Assistance Administrative Plan. However, the guidance states technical assistance
is subject to the availability of staﬀ and disaster activity at the regional and national levels.582
In addition, available data from the Centers for Disease Control and Prevention indicates that
tribes are among the communities of color bearing a disproportionate burden of COVID-19
positive tests, cases, hospitalizations, and deaths. For example, the limited available data on
COVID-19 hospitalizations shows that, as of February 12, 2021, the rate of COVID-19-associated
hospitalizations for non-Hispanic American Indian/Alaska Native persons is 3.7 times the rate for
non-Hispanic White persons, when adjusting for age. Without the availability of consistent and
timely technical assistance across the FEMA regions, some tribal entities may be unable to request
and receive Public Assistance directly from FEMA to help respond to the COVID-19 pandemic.
Agency Comments
We provided a draft of this enclosure to the Department of Homeland Security (DHS), FEMA,
and the Oﬃce of Management and Budget (OMB). DHS concurred with both recommendations.
Speciﬁcally, DHS stated that FEMA’s National Tribal Aﬀairs Adviser, based in the Oﬃce of External
Aﬀairs, will coordinate with other FEMA oﬃces and directorates, as appropriate, to review
the agency’s adherence to protocols listed in the Tribal Consultation policy. For the second
recommendation, DHS stated that FEMA’s Recovery Directorate will publish a memorandum that
will contain direction to FEMA regions regarding the assignment of Public Assistance program
delivery managers to promote equitable delivery of Public Assistance to tribal governments.
The extent to which these steps will address our recommendation that FEMA provide timely and
consistent technical assistance to support tribal governments’ eﬀorts to request and receive
Public Assistance as direct recipients is not clear. We will continue to monitor DHS eﬀorts to
implement these eﬀorts in the coming months. DHS comments are reproduced in appendix VII.
FEMA provided technical comments, which we incorporated as appropriate. OMB did not provide
comments on this enclosure.
Methodology
To conduct this work, we reviewed data from the Disaster Relief Fund and FEMA obligations data
for March 2020 through February 2021. We reviewed federal laws, FEMA policies and guidance on
581 Pandemic Response to Coronavirus Disease 2019 (COVID-19): Initial Assessment Report: FEMA Operations January through
September 2020 (Washington, D.C.: January 2021). Developed by a research and analysis team consisting of FEMA
personnel and emergency management, public health, and other subject matter experts, the report focuses on the
period from January 2020 through September 2020.
582FEMA, Tribal Declarations Pilot Guidance, January 2017.
Page 365
GAO-21-387

how states, local, tribal, and territorial entities may apply for and receive assistance to respond to
the COVID-19 pandemic.
We also reviewed May 2020 letters to Congress from eight tribal organizations; January 21, 2021,
and January 26, 2021, presidential memorandums; FEMA’s February 3, 2021 fact sheet; and FEMA
Advisories. Finally, we interviewed FEMA oﬃcials, representatives from four tribal nations residing
in diﬀerent parts of the country, and two tribal associations. One of the tribal associations is
the oldest, largest, and most representative American Indian and Alaska Native organization
serving the broad interests of tribal governments and communities, and the other’s focus is on
emergency management. While the information from these interviews cannot be generalized to all
tribal nations, it provides illustrative examples of the tribal nation experience in obtaining federal
assistance to respond to the COVID-19 pandemic.
Contact information: Chris Currie, (404) 679-1875, curriec@gao.gov
Related GAO Products
The Nation's Fiscal Health: Action Is Needed to Address the Federal Government's Fiscal Future.
GAO-20-403SP. Washington, D.C.: March 12, 2020.
Tribal Consultation: Additional Federal Actions Needed for Infrastructure Projects. GAO-19-22.
Washington, D.C.: March 19, 2019.
Emergency Management: Implementation of the Major Disaster Declaration Process for Federally
Recognized Tribes. GAO-18-443. Washington, D.C.: May 23, 2018.
Page 366
GAO-21-387

K-12 Education
Centers for Disease Control and Prevention guidance on reassessing schools’ operating status
is more clear and consistent than prior guidance; the Department of Education has taken steps
to track state and school district spending of certain COVID-19 relief funds, but the data gives an
incomplete picture of the status of funds.
Entities involved: Department of Education and the Department of Health and Human Services,
including the Centers for Disease Control and Prevention
Recommendation for Executive Action
The Secretary of Education should regularly collect and publicly report information on school
districts’ ﬁnancial commitments (obligations), as well as outlays (expenditures), in order to more
completely reﬂect the status of their use of federal COVID-19 relief funds. For example, Education
could modify its annual report on state and school district spending data to include obligations
data in subsequent reporting cycles. Education agreed with our recommendation.
Key Considerations and Future GAO Work
We continue to monitor challenges related to educating children during the COVID-19 pandemic.
In June and September 2020, we reviewed state and territory expenditure rates related to funds
provided through the Education Stabilization Fund (ESF) that could be used for K-12 education
needs. We also reviewed guidance from the Centers for Disease Control and Prevention (CDC)
on returning to in-person education. We identiﬁed a lack of cogent, clear, and consistent federal
guidance to help states and school districts reassess the operating status of K-12 schools.583
We recommended that the Director of the CDC ensure that, as CDC updates federal guidance
related to reassessing schools’ operating status, the guidance is cogent, clear, and consistent. The
administration announced a national strategy to respond to COVID-19 on January 21, and directed
federal agencies to coordinate guidance to help schools safely return to in-person education.584
CDC did so on February 12. The guidance focuses on considerations for returning to in-person
learning, as well as mitigation strategies to help prevent and reduce the spread of COVID-19
in school settings. After reviewing the current guidance and CDC’s website, we determined
that CDC’s February 12 guidance for school operating status during COVID-19 is more cogent,
clear, and consistent and encourage CDC to continue with these eﬀorts. As such, we closed our
recommendation as implemented.
The Department of Education (Education) developed an annual reporting process and launched
the ﬁrst phase of a public website in November 2020 to track and provide information on, among
other things, how states and territories are spending their ESF funds. According to data collected
583In this enclosure we refer to state educational agencies (SEAs) as states and local educational agencies (LEAs) as
school districts. This includes the SEAs and LEAs in the District of Columbia and Puerto Rico, as well as the U.S. Virgin
Islands, Guam, the Commonwealth of the Northern Mariana Islands, and American Samoa.
584Exec. Order No. 14,000, 86 Fed. Reg. 7,215 (Jan. 26, 2021).
Page 367
GAO-21-387

by Education, as of February 28, 2021, states and territories had spent about $6.1 billion on
education. However, federal spending data alone provide an incomplete picture of the status
of funds, as there are several factors that inﬂuence spending rates. For example, when school
districts use available ESF funds, school district oﬃcials told us they have to budget for and
obligate these funds before they are permitted to request payment from the state and the state
draws down the funds—that is, requests funds to disburse to the school districts—which is when
Education recognizes the funds as spent. This process can result in a signiﬁcant gap in time
between when a state reports it has spent the funds and the actual rate at which the funds are
being obligated, or “used.”585
We will continue to monitor the administration’s plans to help schools safely return to in-person
learning, as well as state and local eﬀorts to use COVID-19 relief funding to support K-12 education
during the pandemic. For example, we have ongoing work on issues related to disconnected
students (that is, students who have diﬃculty accessing and staying engaged in virtual learning)
and pandemic-related learning loss.
Background
Since spring 2020, CDC has provided information and guidance to help states and local school
district oﬃcials fulﬁll their roles as key decision makers regarding how and when to safely reopen
schools for in-person learning. For example, CDC’s guidance includes considerations on whether
and how to screen students and staﬀ for symptoms of COVID-19, considerations for school
readiness and planning, and frequently asked questions for school administrators, teachers,
parents, and child care providers.
The Consolidated Appropriations Act, 2021, enacted on December 27, 2020, appropriated
approximately $59 billion for states’ and territories’ COVID-19-related education needs through
the ESF.586 This is in addition to the approximately $17 billion in the ESF for states and territories
appropriated under the CARES Act on March 27, 2020.587 Education awards these funds to the
states and the states then award the majority of the funds to the school districts and other
585The timing of when obligations are made for these state-administered programs varies based on the kinds of goods
and services for which obligations are made. See 34 C.F.R. § 76.707.
586These funds provide aid to states, the District of Columbia, and Puerto Rico across two emergency relief funds, as
well as through formula grants to other U.S. territories (referred to in the law as outlying areas). Pub. L. No. 116-260, div.
M, tit. III, §§ 311(a)(1), 312, 313, 134 Stat. 1182, 1924-1932 (2020). The ESF also allocated funds for institutions of higher
education through the Higher Education Emergency Relief Fund and for programs operated or funded by the Bureau of
Indian Education; however, these components are outside of the scope of this enclosure.
587These funds provide aid to states, the District of Columbia, and Puerto Rico across two emergency relief funds,
as well as through the ESF discretionary grants and formula grants to other U.S. territories (referred to in the law as
outlying areas). Pub. L. No. 116-136, §§ 18001(a)(1), 18001(a)(3), 18002, 18003, 134 Stat. 281, 564-567 (2020). The ESF
also allocated funds for institutions of higher education through the Higher Education Emergency Relief Fund and for
programs operated or funded by the Bureau of Indian Education; however, these components are outside of the scope
of this enclosure.
Page 368
GAO-21-387

education-related entitles.588 The American Rescue Plan Act, enacted on March 11, 2021,
appropriated approximately $126 billion speciﬁcally for ESF programs previously authorized by the
CARES Act and Consolidated Appropriations Act, 2021 for K-12 education-related purposes.589
Overview of Key Issues
Guidance for safely reopening K-12 school buildings. Since spring 2020, the federal government
has oﬀered information and guidance to help states and local school district oﬃcials make risk-
based decisions regarding how and when to reopen schools for in-person learning. As part of
a national strategy for safely reopening schools for in-person learning, in January 2021, the
President issued an Executive Order directing Education and the Department of Health and
Human Services, including CDC, to, among other things, work together to ensure that guidance for
schools is evidence-based.
In addition to the Executive Order, the President directed Education to work with CDC to issue
a school reopening handbook to help answer school administrators’ and educators’ questions
about how to ensure safe operations. On February 12, 2021, CDC issued updated guidance on
safely returning to in-person education.590 As with the previous guidance, the update focuses on
ﬁve mitigation strategies for safe school operations during COVID-19: (1) universal and correct
wearing of masks; (2) physical distancing; (3) handwashing and respiratory etiquette; (4) cleaning
and maintaining healthy facilities, including ventilation improvements; and (5) contact tracing
in combination with isolation and quarantine, in collaboration with the state, local, territorial or
tribal health departments. Simultaneously, Education released a handbook—the ﬁrst of a series of
volumes—which includes practical approaches for implementing CDC’s ﬁve mitigation strategies in
elementary and secondary schools.591
We ﬁrst reviewed federal guidance on reopening schools in June 2020 and in September 2020
we reported on weaknesses and CDC agreed with our recommendation to ensure its guidance
was cogent, clear, and consistent. Since then, CDC reported that it continues to review COVID-19
guidance and has taken actions to make updates more consistently across guidance documents
and across its website. After reviewing the current guidance and CDC’s website, we determined
that CDC’s guidance for school operating status during COVID-19 is more cogent, clear, and
consistent and encourage CDC to continue with these eﬀorts.
588School districts are not the only subgrantees of ESF funds. For example, governors are awarded some of the ESF
funds and can make subawards to school districts, institutes of higher education, or other education-related entities.
This enclosure is focused on subawards to school districts.
589American Rescue Plan Act of 2021, Pub. L. No. 117-2, §§ 2001, 2002, 135 Stat. 4, 19-23.
590See Centers for Disease Control and Prevention, Operational Strategy for K-12 Schools through Phased Mitigation,
accessed on February 12, 2021, https://www.cdc.gov/coronavirus/2019-ncov/community/schools-childcare/operation-
strategy.html.
591See Department of Education, Oﬃce of Planning, Evaluation and Policy Development, ED COVID-19 Handbook, Volume
1: Strategies for Safely Reopening Elementary and Secondary Schools, Washington, DC, 2021. This guidance is also available
at: https://www2.ed.gov/documents/coronavirus/reopening.pdf.
Page 369
GAO-21-387

ESF spending. Federal spending data alone provides an incomplete picture of states’ and school
districts’ spending. According to data collected by Education, as of February 28, 2021, states and
territories had spent about $6.1 billion on COVID-19-related education needs. (See ﬁgure).
Federal COVID-19 Relief for States and Territories Provided through Education Stabilization Funds and Amount
Spent, as of February 28, 2021
Notes: Dollar ﬁgures are rounded to the nearest million.
The Consolidated Appropriations Act, 2021, enacted on December 27, 2020, appropriated approximately $59 billion for states’
and territories’ COVID-19-related education needs through the ESF. This is in addition to the approximately $17 billion in the ESF
for states and territories appropriated under the CARES Act on March 27, 2020.
These funds provide aid to states, the District of Columbia, and Puerto Rico across two emergency relief funds, as well as
through formula grants to other U.S. territories (referred to in the law as outlying areas). The CARES Act also provided aid for
states through ESF discretionary grants. Pub. L. No. 116-260, div. M, tit. III, §§ 311(a)(1), 312, 313, 134 Stat. at 1924-1932 and
Pub. L. No. 116-136, §§ 18001(a)(1), 18001(a)(3), 18002, 18003, 134 Stat.at 564-567. Funds were also provided through the ESF
for institutions of higher education and for programs operated or funded by the Bureau of Indian Education; however, these
components are outside of the scope of this enclosure and are not reﬂected in the ﬁgure.
The CARES Act allows states a year after they receive their grants to award (subgrant) certain
ESF funds to school districts (subgrantee).592 Once awarded, districts have until the end of ﬁscal
year 2022 to obligate the CARES Act funds for speciﬁc purposes.593 The Congressional Budget
Oﬃce (CBO) estimated that more than half of the CARES Act ESF funds will be spent (outlayed or
expended) by the end of ﬁscal year 2021—a target that states and school districts appear on track
592Pub. L. No. 116-136, §§ 18002(d), 18003(f), 134 Stat. at 565, 567. This requirement generally applies to governors and
states receiving funding within the ESF funds.
593Similarly, districts have until the end of ﬁscal year 2023 to obligate the ESF funds awarded through the Consolidated
Appropriations Act, 2021 to speciﬁc purposes.
Page 370
GAO-21-387

to meet. There are several factors that may contribute to the rate at which funds appear to be
spent.
• First, there is often a signiﬁcant gap between when a district “uses” the funds (i.e., orders,
contracts for, installs, and pays for goods or services, such as IT equipment) and when those
funds are reported as “spent” in state and federal reporting systems, as is common in federal
grants management processes. According to Education oﬃcials, states award applicable
ESF funds to school districts so that the school districts can obligate those funds to speciﬁc
purposes. The state does not transfer funds to the district until the district requests payment
for services or deliverables received. According to Education oﬃcials, they do not consider the
funds spent, and their public website does not show them as such, until the state requests
payment for expenses.594 School district oﬃcials told us that they budget for how they will use
available ESF funds and may obligate them well before they request funds from states to make
payments. (See ﬁgure below.)
594School districts request reimbursement from the state and the state requests a drawdown from the U.S.
Treasury.
Page 371
GAO-21-387

Examples of Key Milestones in the Funding Stream for the Education Stabilization Fund
Note: This ﬁgure provides examples of key milestones. In some instances, additional or diﬀerent steps may occur in the funding
stream.
• Second, some of the funds are used for services that occur and are paid for over time. For
example, if a school district uses its ESF funds to hire additional custodial staﬀ, substitute
teachers, or other staﬀ to address pandemic needs, the district would pay for these services as
they are rendered (for example, via bi-weekly payroll) and would request the ESF funds from
the state over time.
• Third, some equipment, such as laptops and new heating, ventilation, and air conditioning
(HVAC) systems, must be ordered well in advance, and some high demand items are
reportedly signiﬁcantly delayed. For example, in one case, district oﬃcials told us that the
air ﬁlters needed for their HVAC system are not currently available in the U.S. due to high
demand during the pandemic and they do not know when they will receive the parts. Oﬃcials
Page 372
GAO-21-387

from another school district told us that the laptops they ordered in October 2020 were
backordered and not expected to arrive until April 2021.
• Fourth, during its monitoring eﬀorts, Education found that some states had drawn down
CARES Act funds before they were needed to pay for a good or service. Education found
that at least one state did not follow federal cash management requirements when it drew
down funds and provided advance funding to school districts (subgrantees). Education has
requested states redeposit those funds in the U.S. Treasury until they are needed. Some states
have already returned these funds; however, total spending may appear inﬂated in those
states that have not yet redeposited or spent their funds.
Education data sharing. In an eﬀort to shed light on how CARES Act ESF funds are being spent,
Education took an important step toward transparency by launching two eﬀorts in November
2020—an annual reporting process and the ESF Transparency Portal website (https://covid-
relief-data.ed.gov). The annual report collects information on, among other things, how states
and subgrantees, such as school districts, have spent their ESF funds, whereas the portal will
initially focus on state spending and the amounts awarded to subgrantees.595 Neither focuses
on the amount of ESF funds subgrantees have obligated but have not yet drawn down (known
as unliquidated obligations). Education oﬃcials told us that they are still working out key details
around the public interface with these data from both eﬀorts, such as how much and what
portions of the annual report data will be shared on the portal.
For the annual report, Education asked states to provide, by February 1, 2021, detailed information
on how subgrantees, such as school districts, have spent the ESF funds that they received in
ﬁscal year 2020—that is, through September 30, 2020; Education plans to publish data from the
annual report via the ESF portal in April 2021. Education also asked states to report information on
subgrantee activities that speciﬁcally target key student groups (for example, children from low-
income families or children who are experiencing homelessness). Education plans to ask states to
report annually on how subgrantees spent funds until all the funds have been drawn down from
the ESF.
Education’s ESF Transparency Portal website launched on November 20, 2020. (See ﬁgure below
for an image of the portal’s main page.) Its state proﬁle pages provide information on how much
money from the CARES Act ESF each state has been awarded and how much money each has
spent.596 Education obtains information on state awards and spending from a variety of federal
sources that regularly capture ﬁnancial transactions.597 The state proﬁle pages also include other
595The portal also tracks how institutions of higher education have spent their CARES Act ESF funds; however, this
information is outside the scope of this enclosure. The portal does not track ESF discretionary grants or funds provided
through the ESF for Bureau of Indian Education programs.
596Education oﬃcials told us that they would include ESF funds granted through the Consolidated Appropriations Act,
2021 in the portal, but had not yet determined whether they would be presented separately or combined with CARES
Act funds.
597As part of the Digital Accountability and Transparency Act (DATA Act), the grantees are required to submit all contract,
grant, loan, direct payment, and other award data on a frequent basis to be published on USAspending.gov. Pub. L. No.
113-101, 128 Stat. 1146 (2014). The DATA Act amended the Federal Funding Accountability and Transparency Act of 2006.
Pub. L. No. 109-282, 120 Stat. 1186, codiﬁed at 31 U.S.C. § 6101 note. USASpending.gov is the oﬃcial open data source
Page 373
GAO-21-387

details, such as breakdowns of a state’s awards to school districts.598 Education plans to update
the portal frequently, with some data updated on a weekly basis, according to Education oﬃcials.
Department of Education Transparency Portal Main Page, as of February 26, 2021
Although both eﬀorts are a good ﬁrst step toward insight into how states, school districts, and
other subgrantees are using ESF funds, Education’s choices about the timeframes for which data
are collected and the type of budget data requested present an incomplete picture of the rate
at which school districts and states are using ESF funds for K-12 education purposes. Regarding
school district subgrantee data, both the annual report and the portal report on “cash out the
door” (i.e., outlays or expenditures) rather than information on ﬁnancial commitments to purchase
goods or services (i.e., obligations). Education oﬃcials told us that the national emergency
required them to act quickly and the size of the ESF required a balanced approach to oversight.
They said they chose to focus on outlays because this information could easily be corroborated
and it was already in use in their other oversight activities.
of federal spending information and is operated by the Bureau of the Fiscal Service of the Department of the Treasury.
Education draws information on the demographics of school districts that receive ESF funds from its Common Core of
Data.
598The site also provides information on certain funds awarded by the department and used by states, territories,
school districts, institutions of higher education, and other education-related entities to alleviate the impact of COVID-19.
Page 374
GAO-21-387

We appreciate the challenges of quickly standing up oversight tools for a new, non-recurring, and
large program while also developing another relief program. However, both Education and the
Congress have recognized the importance of accurately capturing the status of COVID-19 relief
funds provided to states and school districts to inform the department’s monitoring and technical
assistance, and to provide transparency to the public about uses of the funds. While tracking
obligations and outlays each serve a diﬀerent purpose, obligations—not outlays—measure legal
commitments to pay for goods and services ordered and received. Federal budgeting guidance
states that both methods of tracking funds play an important part in ensuring the ﬁnancial
accountability of the government to the American people, and agencies cannot overlook either of
them. Absent information on the degree to which school districts have obligated their COVID-19
relief funding, policymakers will not have an accurate, complete picture of the status of school
district spending. Further, given the gap that often exists between when funds are obligated and
when they are disbursed, absent information on obligations, policymakers will not have complete
information on how these funds are being used to address the pandemic-related education needs
of America’s schoolchildren.
Methodology
To conduct this work, we reviewed relevant federal laws, regulations, and Education and CDC
guidance. We also interviewed Education oﬃcials regarding program implementation and
analyzed Education spending data. To assess the reliability of Education’s spending data, we
reviewed information on the sources of these data, and we followed up with knowledgeable
individuals as needed to answer questions about the appropriate use and potential limitations of
these data. We found these data to be suﬃciently reliable for our purposes.
To collect the perspectives of a range of state and local stakeholders, we interviewed oﬃcials from
the Council of Chief State School Oﬃcers, the School Superintendents Association, and National
Governors Association. We also worked with the School Superintendents Association to conduct
interviews with eight state and local school agency oﬃcials. Information from the interviews
provided examples of how state and local agencies were using ESF funds, and does not reﬂect
the views of all state and local agency oﬃcials. In addition, we conducted two interviews with
state educational agency oﬃcials after reviewing ESF spending rates and information in states’
ESF applications. In addition, to obtain information on Education’s monitoring of grantees’ use
of ESF funds, we reviewed about 575 correspondence related to the Elementary and Secondary
School Emergency Relief or Governor’s Emergency Education Relief funds between Education
and states, governors, and state educational agencies. Our review was limited to correspondence
dated between December 1, 2020 and January 31, 2021.
Agency Comments
We provided CDC, Education, and the Oﬃce of Management and Budget (OMB) with a draft of this
enclosure. Education provided general comments, which are summarized below and reproduced
in appendix IV, and technical comments, which we incorporated as appropriate. OMB and CDC did
not provide comments on this enclosure.
Page 375
GAO-21-387

In its comments, Education agreed with GAO’s recommendation, stating that it is important to
track obligations, outlays, and drawdowns to ensure accountability for state and school district
spending. Education also committed to working collaboratively with states to develop reporting
processes that provide greater clarity on state and school district spending. We will continue to
monitor Education’s eﬀorts to collect and report on state and school district outlays (expenditures)
as well as their ﬁnancial commitments (obligations).
Contact information: Jacqueline M. Nowicki, (617) 788-0580, nowickij@gao.gov
Related GAO Product
A Glossary of Terms Used in the Federal Budget Process. GAO-05-734SP, Washington D.C.: September
2005.
Page 376
GAO-21-387

Transit Industry
Transit agencies continue to use CARES Act funding, but anticipate long-term ﬁnancial and
operational challenges due to the COVID-19 pandemic.
Entity involved: Federal Transit Administration, within the Department of Transportation
Key Considerations and Future GAO Work
We will continue to monitor the status of CARES Act grants and other COVID-19 relief funding to
transit agencies in ongoing and planned work.
Background
Millions of Americans rely on public transportation systems for mobility and access to jobs,
education, and essential services, such as medical care and grocery shopping. Within the
Department of Transportation (DOT), the Federal Transit Administration (FTA) provides grants
to state departments of transportation, local public transit systems, and tribes to support and
expand services. These services may include buses, subways, light rail, commuter rail, trolleys, and
ferries in urban, rural, and tribal areas.
The CARES Act appropriated about $25 billion to FTA to support the transit industry through its
Urbanized Area ($22.7 billion) and Rural Area ($2.2 billion) formula programs.599 CARES Act grant
funds were available to transit agencies for any expenses incurred related to COVID-19 on or after
January 20, 2020, although now these funds must be directed, to the maximum extent possible, to
payroll and operations expenses.600 There is no limit on the amount of funds recipients may use
for operating expenses.601
On December 27, 2020, the Consolidated Appropriations Act, 2021, appropriated an additional
$14 billion to FTA to prevent, prepare for, and respond to coronavirus to support the transit
industry.602 Similar to the CARES Act, FTA is allocating these funds through its Urbanized Area
599Pub. L. No. 116-136, 134 Stat. 281, 599 (2020). Within the funds appropriated to the Rural Area formula program,
$30 million is set aside for tribal transit programs, and an additional $75 million is set aside for the administration and
oversight of the funds. FTA allocated the $25 billion to urbanized areas, states, and tribes on April 2, 2020.
600As of December 27, 2020, recipients were required to direct funds, to the maximum extent possible, to payroll and
operations of public transit (including payroll and expenses of private providers of public transportation), unless the
recipient certiﬁes to the Secretary of Transportation that the recipient has not furloughed any employees. Consolidated
Appropriations Act, 2021, div. M, tit. IV, 134 Stat. 1182, 1947.
601These ﬂexibilities are exceptions to the usual process for FTA’s Urbanized Area and Rural Area formula programs.
An additional exception is that there is no requirement for local matching funds for grants provided to large and
small urban areas and rural areas. All other Urbanized Area and Rural Area program requirements apply to CARES Act
funds, with the exception that operating and certain capital expenses do not need to be included in a transportation
improvement program, a long-range transportation or statewide transportation plan, or a statewide transportation
improvement program.
602Pub. L. No. 116-260, div. M, tit. IV, 134 Stat. at 1945-48. Division M of the Consolidated Appropriations Act, 2021, is
also referred to as the Coronavirus Response and Relief Supplemental Appropriations Act, 2021 (CRRSAA).
Page 377
GAO-21-387

and Rural Area formula programs. However, of the available funds, $50 million is for FTA’s
program for the enhanced mobility of seniors and individuals with disabilities.603 The Consolidated
Appropriations Act, 2021, limited funding to 75 percent of an urbanized area’s 2018 operating
expenses and 125 percent of a state’s 2018 rural operating expenses when combined with the
area’s CARES Act funding.604 As a result, urbanized areas and states whose CARES Act allocations
already exceeded the applicable 2018 operating expenses threshold are not eligible to receive
funding under the Consolidated Appropriations Act, 2021.
On March 11, 2021, the American Rescue Plan Act of 2021 appropriated approximately an
additional $30 billion to FTA for grants to prevent, prepare for, and respond to coronavirus to
support the transit industry.605 We will continue to monitor those funds.
Overview of Key Issues
FTA continues to distribute CARES Act grant funds and support transit agencies. According
to FTA oﬃcials, as of February 28, 2021, 97 percent of available CARES Act funding had been
obligated. FTA oﬃcials reported that an additional 127 grants were in progress. FTA oﬃcials
said that as of February 28, 2021, recipients had obligated 86.3 percent of CARES Act funds for
operating expenses, though obligating funds for capital and planning expenses is also allowed (see
table).
603Consolidated Appropriations Act, 2021, funds are also provided at 100 percent federal share for FTA’s program for
the enhanced mobility of seniors and individuals with disabilities, with no local match required.
604Operating expenses for 2018 were determined from data reported to FTA’s National Transit Database.
605Pub. L. No. 117-2, § 3401, 135 Stat. 4, 72-77.
Page 378
GAO-21-387

Transit Agency Obligations of CARES Act Grant Funds by Expense Category in Urban, Rural, and Tribal Areas, as of
February 28, 2021
Expense
Urban
($ millions)
Rural
($ millions)
Tribal
($ millions)
Total
($ millions)
Operating
$20,304
$1,217
$7
$21,528
Capital
$1,685
$397
$15
$2,098
Othera
$16
$442
$0.3
$458
Total b
$22,005
$2,056
$23
$24,084
Source: GAO analysis of Federal Transit Administration data. | GAO-21-387
Note: The law appropriating the amounts obligated here is the CARES Act, Pub. L. No. 116-136, 134 Stat. 281 (2020).
a”Other” includes expenses for project and program administration, intercity bus, planning, job access and reverse commute,
and training expenses.
bNumbers may not total due to rounding.
FTA continues to oversee CARES Act grants and will integrate CARES Act monitoring into
its existing program review processes. Oﬃcials said that the status of CARES Act obligations is
reported twice a week to the FTA Oﬃce of the Administrator, and is reported regularly to both the
DOT Oﬃce of the Secretary and the Oﬃce of Management and Budget. In addition, FTA oﬃcials
stated that the agency reinitiated its oversight review processes in October 2020, which will include
updated review materials that integrate CARES Act oversight into the agency’s existing Triennial
and State Management review processes.
A smaller portion of urbanized areas, states, and tribes received allocations under the
Consolidated Appropriations Act, 2021, compared to the CARES Act. According to FTA oﬃcials,
360 of 500 urbanized areas had already received funds that cover at least 75 percent of their
operating expenses under the CARES Act, and these areas will not receive funds under the
Consolidated Appropriations Act, 2021. FTA allocated these funds on January 11, 2021, and as
of February 28, recipients had obligated approximately 1 percent of available funds (see table).
The act directs recipients, including those who have not obligated all of their CARES Act funds, to
prioritize payroll and operational needs unless the recipient certiﬁes that it has not furloughed any
employees.
Page 379
GAO-21-387

Transit Industry Allocations and Obligations by Program under the Consolidated Appropriations Act, 2021, as of
February 28, 2021
Urban
($ millions)
Rural
($ millions)
Tribal
($ millions)
Enhanced
Mobility
($ millions)
Obligations
$151
$12
$2
$0.7
Total allocated funds
$13,262
$648
$30
$50
Source: GAO analysis of Federal Transit Administration data. | GAO-21-387
Note: The law appropriating the amounts obligated here is the Consolidated Appropriations Act, 2021, Pub. L. No. 116-260, div.
M, tit. IV, 134 Stat. 1182 (2020).
Transit agencies continue to report using CARES Act grants to mitigate the spread of
COVID-19. As we reported in November 2020, transit agency oﬃcials we spoke to said they took
steps to mitigate the spread of COVID-19, including general practices such as enhanced cleaning
and sanitation, requiring the use of masks, and social distancing. According to oﬃcials from two
transit industry groups, transit agencies generally continue to employ such measures. Additionally,
one of these industry groups has identiﬁed these types of measures, among others, as best
practices after a pandemic viral outbreak.606
In January 2021, FTA published the second version of its COVID-19 recovery practices document,
which outlines practices implemented by transit systems worldwide in response to COVID-19.
The document includes many of the aforementioned practices, such as cleaning and disinfecting
vehicles and minimizing interactions between employees and passengers. In addition, it includes
examples of how transit agencies can communicate with passengers and plan for future service
changes.
Transit agencies anticipate long-term consequences from the COVID-19 pandemic. Oﬃcials
from two transit industry groups we spoke to said transit agencies are reorienting their focus
from immediate concerns about health and safety to mitigating the anticipated long-term
consequences of the COVID-19 pandemic. According to oﬃcials, these anticipated consequences
include reduced demand for transit services, increased operating costs, and the inability of state
and local funding sources to match FTA funds. Industry group oﬃcials said while some transit
agencies quickly used all allocated CARES Act funding, others are reserving as much as 50 percent
of their funding to mitigate anticipated negative eﬀects of the COVID-19 pandemic. According to
oﬃcials from one industry group, transit agencies that primarily rely on income from ridership
fares tended to use their CARES Act funding more rapidly than agencies that rely mostly on tax
revenue. In November 2020, we reported that seven of the 22 transit agencies we spoke to said
they did not expect to use all their CARES Act funding until a year or more to mitigate future
uncertainty and the expectation of a slow economic recovery; the remaining 15 had either used
all their funding or planned to do so within a year. FTA oﬃcials said that some smaller rural and
tribal transit agencies found that they needed to purchase additional vehicles to maintain social
distancing and needed levels of service. Purchasing additional vehicles under the CARES Act
606American Public Transportation Association, Guidance and Best Practices for COVID-19, accessed January 28, 2021,
https://apta.com/covid-19-resource-hub/guidance-and-best-practices-for-covid-19.
Page 380
GAO-21-387

required these recipients to obtain Statewide Transportation Improvement Program approval, and
the procurement process may extend the amount of time the agencies need to expend funds,
according to FTA oﬃcials.
Oﬃcials from two industry groups said that FTA guidance has generally been clear and eﬀective.
However, oﬃcials from one of these groups stated that confusion can sometimes arise when
state departments of transportation provide guidance that appears to contradict what is posted
on FTA’s website. For example, oﬃcials said transit agencies sometimes receive conﬂicting
information about the extent to which they can continue using transit assets for delivery services
to persons who are homebound. According to FTA oﬃcials, FTA has issued guidance and provided
technical assistance to provide clarity on these issues.
Agency Comments
We provided DOT and the Oﬃce of Management and Budget (OMB) with a draft of this enclosure.
DOT provided technical comments, which we incorporated as appropriate. OMB did not provide
comments on this enclosure.
Methodology
To conduct this work, we analyzed DOT and FTA data on transit industry grant funding as of
February 28, 2021. Our analysis, as well as discussions with agency oﬃcials and a review of related
documentation, found the data to be reliable for the purposes of describing federal allocations
and transit agency obligations and expenditures. We reviewed written responses from DOT and
FTA oﬃcials about how they were implementing applicable provisions of the CARES Act and the
Consolidated Appropriations Act, 2021. In addition, we interviewed the Community Transportation
Association of America and the American Public Transit Association to discuss the impact of
the funds appropriated by CARES Act and the Consolidated Appropriations Act, 2021, on their
members.
Contact information: Andrew Von Ah, (202) 512-2834, vonaha@gao.gov
Page 381
GAO-21-387

Airport Grants
The Federal Aviation Administration is administering funding for grants to help the nation’s
airports respond to and recover from the economic eﬀects of the COVID-19 pandemic.
Entity involved: Federal Aviation Administration, within the Department of Transportation
Key Considerations and Future GAO Work
Since we reported on airport grants in November 2020, we have identiﬁed airports’ continued
concerns about declines in revenue and operations, and uncertainty about when airports will
return to pre-pandemic activity levels. We will continue to monitor CARES Act grants and other
COVID-19-related assistance to airports in future GAO work.
Background
U.S. airports are important contributors to the U.S. economy and fulﬁll a variety of vital roles, from
supporting scheduled commercial air service to supporting freight transportation, emergency
medical transportation, and disaster relief. Approximately 3,300 airports in the U.S. are part of
the national airport system and are eligible to receive federal Airport Improvement Program (AIP)
grants to fund infrastructure projects. As we reported in February 2020, from ﬁscal years 2013
through 2017, airports received an average of $3.2 billion annually in federal AIP grants.
Historic decreases in passenger demand for air travel due to the COVID-19 pandemic are
signiﬁcantly aﬀecting U.S. airports’ abilities to generate the revenue needed for operating and
infrastructure costs. According to data ﬁled with Department of Transportation (DOT), U.S. airlines
carried 61 percent fewer passengers in November 2020 than in November 2019. One airport
association estimates that U.S. airports will face $40 billion in expected operating losses and
additional costs related to COVID-19 from March 2020 to March 2022.
Federal funding for airports. The CARES Act and the Consolidated Appropriations Act, 2021,
provide U.S. airports with a combined total of $12 billion in federal funding to respond to the
COVID-19 pandemic, although funding allocation and allowable uses diﬀer. The CARES Act, signed
into law on March 27, 2020, provided $10 billion to support U.S. airports of all sizes experiencing
severe economic disruption caused by the COVID-19 pandemic (see table).607 Airport owners—also
known as airport sponsors—may use CARES Act funds for any purpose for which airport revenues
may be lawfully used, including for airport operating expenses and debt service.
607Pub. L. No. 116-136, 134 Stat. 281, 596-97. The CARES Act gives the Federal Aviation Administration (FAA) the
authority to retain up to 0.1 percent of the $10 billion (up to $10 million) provided for Grants-in-Aid for Airports to fund
the award and oversight by FAA of grants made under the CARES Act.
Page 382
GAO-21-387

CARES Act Airport Grants
Funding groups
Funds
appropriated
(in dollars) a
Formula applied
1) Increase federal share for 2020
Airport Improvement Program (AIP)
grants
At least 500 million Increase the federal share to 100 percent for grants awarded
for airport infrastructure projects under ﬁscal year 2020 AIP
and supplemental discretionary grantsb
2) Commercial service airports (i.e.,
publicly owned airports with at least
2,500 passenger boardings per year
and scheduled air service)
At least 7.4 billion
Allocate based on a formula that considers an airport’s
passenger boardings, the airport sponsor’s debt service, and
the sponsor’s ratio of unrestricted reserves to debt servicec
3) Primary airports (i.e., large,
medium, and small hub and non-
hub airports with more than 10,000
passenger boardings per year)d
Up to 2 billion
Allocate based on statutory AIP entitlement formulas
4) General aviation airports (i.e.,
airports with fewer than 2,500
passenger boardings per year and no
scheduled air service)
At least 100 million Allocate based on the categories these airports are placed in
given activity measures (e.g., volume and type of ﬂights) and
other factors in the most current National Plan of Integrated
Airport Systems (NPIAS)
Source: GAO analysis of CARES Act, Pub. L. No. 116-136, 134 Stat. 281 (2020). | GAO-21-387
aThe CARES Act gives the Federal Aviation Administration (FAA) the authority to retain up to 0.1 percent of the $10 billion (up
to $10 million) provided for Grants-in-Aid for Airports to fund the award and oversight by FAA of grants made under the CARES
Act.
bNational system airports are eligible to receive federal funding from AIP grants for infrastructure development. The
distribution of federal AIP grants is based on a combination of formula funds—also referred to as entitlement funds—that are
available to national system airports, and discretionary funds that FAA awards for selected eligible projects. Entitlement funds
are apportioned by formula to airports and may generally be used for any eligible airport improvement or planning project.
Discretionary funds are approved by FAA based on FAA selection criteria and a priority system, which FAA uses to rank projects
based on the extent to which they reﬂect FAA’s nationally identiﬁed priorities. The federal share for AIP grants generally ranges
from 75 percent to 95 percent.
cThe FAA used ﬁscal year 2018 Certiﬁcation Activity Tracking System (CATS) data, reported as of March 14, 2020, to calculate
allocations under the CARES Act formulas for commercial service airports. More speciﬁcally, the total allocation to a commercial
service airport is determined by a formula that considers an airport’s passenger boardings for calendar year 2018 (50 percent),
the airport sponsor’s debt service (25 percent), and the sponsor’s ratio of unrestricted reserves to debt service (25 percent),
both for ﬁscal year 2018.
dThis funding group may also include non-primary commercial service airports with 8,000 to 9,999 passenger boardings. CARES
Act, div. B, tit. XII, para. (3), 134 Stat. at 597.
The Consolidated Appropriations Act, 2021, enacted on December 27, 2020, provides $2 billion
in additional federal aid to help eligible airports and certain tenants to prevent, prepare for,
and respond to COVID-19 (see table).608 The funding groups and allocation formulas for the
Consolidated Appropriations Act, 2021 grants diﬀer from the CARES Act grant funding, as do the
608Pub. L. No. 116-260, div. M, tit. IV, 134 Stat. 1182, 1939-41 (2020). Division M of the Consolidated Appropriations Act,
2021 is also referred to as the Coronavirus Response and Relief Supplemental Appropriations Act, 2021 (CRRSA).
Page 383
GAO-21-387

allowable uses of funds.609 Airports must use Consolidated Appropriations Act, 2021 grant funding
for costs related to operations, personnel, cleaning, sanitization, janitorial services, combating
the spread of pathogens at the airport, and debt service payments. According to FAA guidance,
examples of eligible development to combat the spread of pathogens at the airport include
replacing or upgrading a heating, ventilation, and air conditioning system; and reconﬁguring the
terminal to accommodate increased social distancing or health screening.
609As we previously reported in June 2020, the grant formula in the CARES Act and available data for calculating the
awards for commercial service airports (i.e., passenger boardings, debt service, and the ratio of unrestricted reserves to
debt service) resulted in some small airports being allocated large amounts relative to their passenger activity or annual
operating budgets. In other cases, the formula and available data resulted in some airports with large annual passenger
boardings being awarded less funding than airports with fewer annual passenger boardings.
Page 384
GAO-21-387

Consolidated Appropriations Act, 2021, Airport Grants
Funding groups
Funds
appropriated
(in dollars) a
Formula applied
1) Primary Commercial Service
Airports and Certain Cargo Airportsb
Not less than 1.75
billion
Allocate ﬁrst based on the statutory Airport Improvement
Program (AIP) primary and cargo entitlement formulas.
Allocate the remainder based on the number of
enplanements the airport had in calendar year 2019, the
most recent calendar year of available enplanement data,
as a percentage of total 2019 enplanements for all primary
airports.
2) Non-Primary Commercial Service
and General Aviation Airportsc
Not less than 45
million
Allocate based on current National Plan of Integrated Airport
Systems (NPIAS) categories, reﬂecting the percentage of the
aggregate published eligible development costs for each such
category, and then dividing the allocated funds evenly among
the eligible airports in each category. Any remaining funds are
to be allocated to primary commercial service airports and
certain cargo airports described in Funding Group 1.
2a) Non-Primary Airports
Participating in the Federal
Aviation Administration (FAA)
Contract Tower Programd
Not less than 5
million (of the 45
million above)
Allocate based on participating in the FAA contract tower
program. Funds are divided equally among eligible airports.e
3) Tenant Relief for Primary
Commercial Service Airportsf
At least 200 million Allocate based on the number of airport enplanements in
calendar year 2019 as a percentage of total calendar year
2019 enplanements for all primary airports.
4) Small Community Air Service
Development Programg
Up to 5 million
Transfers funding to the Oﬃce of the Secretary, Salaries
and Expenses. Gives priority to communities or consortia
of communities that have had air carrier service reduced or
suspended as a result of the coronavirus pandemic.
Source: GAO analysis of the Consolidated Appropriations Act, 2021, Pub. L. No. 116-260, div. M, tit. IV, 134 Stat. 1182, 1939-41 (2020). | GAO-21-387
aThe Consolidated Appropriations Act, 2021 gives the Federal Aviation Administration (FAA) the authority to retain up to 0.1
percent of the $2 billion (up to $2 million) provided for Grants-in-Aid for Airports to fund the award and oversight by FAA of
grants made under the Consolidated Appropriations Act, 2021.
bPrimary commercial service airports are publicly owned airports with more than 10,000 passenger boardings per year and
scheduled air service. Cargo airports are airports that, in addition to any other air transportation services that may be available,
are served by aircraft providing air transportation of only cargo with a total annual landed weight of more than 100 million
pounds.
cNon-primary commercial service airports have at least 2,500 and no more than 10,000 passenger boardings each year. General
aviation airports are public-use airports with fewer than 2,500 passenger boardings per year or no scheduled air service.
dNon-primary airports are the same as non-primary commercial service airports, and have at least 2,500 and no more than
10,000 passenger boardings each year. The Federal Contract Tower Program, established in 1982, allows the agency to contract
out the operation of certain towers. Contract towers are air traﬃc control towers that are staﬀed by employees of private
companies rather than by FAA employees. There are currently 256 contract towers, for which the FAA pays for air traﬃc control
services on a contract basis.
eUnder the Consolidated Appropriations Act, 2021, airport sponsors of non-primary airports that participate in the FAA Contract
Tower Program may use these funds to cover any lawful costs associated with supporting their FAA contract tower operations.
FAA guidance states that these costs include payroll, utilities, service contracts, and items generally having a limited useful
life, including personal protective equipment and cleaning supplies. The $5 million in funding to this group comes from the
Page 385
GAO-21-387

minimum of $45 million in funding appropriated for non-primary commercial service and general aviation airports in funding
group 2 described above.
fPrimary commercial airport sponsors may only use these funds to provide relief from rent and minimum annual guarantees to
on-airport car rental, on-airport parking, and in-terminal airport tenants, subject to additional conditions.
gThe Small Community Air Service Development Program is a grant program designed to help small communities address
air service and airfare issues. The airport serving the community or consortium is not larger than a small hub airport, which
is a primary commercial service airport that receives 0.05 to 0.25 percent of the annual U.S. commercial enplanements, as
determined using the FAA’s most recently published classiﬁcation eﬀective on the date that the community or consortium ﬁles
an application.
The American Rescue Plan Act of 2021, enacted on March 11, 2021, appropriates an additional $8
billion for assistance to sponsors of airports.610 We will monitor this funding going forward.
Workforce retention requirements. Certain airport sponsors accepting CARES Act grant funds
were required to continue to employ, through December 31, 2020, at least 90 percent of the
number of individuals employed as of March 27, 2020.611 Similarly, airports receiving funds from
the Consolidated Appropriations Act, 2021 were required to employ at least 90 percent of the
number of individuals employed as of March 27, 2020 through February 15, 2021.612 According
to FAA, the 130 largest U.S. airports, serving approximately 96 percent of U.S. commercial
service passenger boardings in 2018, were subject to this requirement. However, airports with
limited commercial service or that primarily serve general aviation ﬂights were exempt from this
requirement.613
Allocations, obligations and expenditures. Following the enactment of the CARES Act, FAA
ﬁnalized grant allocation amounts totaling nearly $10 billion.614 As of February 14, 2021, FAA had
610Pub. L. No. 117-2, § 7102, 135 Stat. 4, 96-98.
611Airports were required to retain 90 percent of full-time equivalent employees working at the airport as of March
27, 2020, as the baseline comparison. According to FAA guidance, airport sponsors did not need to count contractors
providing services other than airport management, tenants, or concessionaires. Airport sponsors may make
adjustments for retirements or voluntary employee separations when calculating the workforce retention percentage.
Nonhub and non-primary airports were excluded from the workforce retention requirement.
612As with the CARES Act, DOT could waive the workforce retention requirement under the Consolidated Appropriations
Act, 2021, if DOT determined that the airport was experiencing economic hardship as a direct result of the requirement,
or the requirement reduces aviation safety or security. Additionally, nonhub and non-primary airports were also
excluded from the workforce retention requirement, as with the CARES Act. The American Rescue Plan Act of 2021
extended workforce retention requirements through September 30, 2021.
613Speciﬁcally, nonhub and non-primary airports are excluded from the workforce retention requirement. As a result,
nonhub primary commercial service airports (airports with more than 10,000 annual passenger boardings, but less
than .05 percent of total annual passenger boardings); non-primary commercial service airports (airports with at least
2,500 and no more than 10,000 passenger boardings each year); general aviation airports (public-use airports that
do not have scheduled service or have scheduled service with fewer than 2,500 passenger boardings each year); and
reliever airports (airports designated by FAA to relieve congestion at commercial service airports) are all exempt from the
workforce retention requirement.
614Speciﬁcally, FAA allocated $500 million to increase the federal share for grants awarded for airport infrastructure
projects under ﬁscal year 2020 AIP and supplemental discretionary grants, and allocated $9.1 billion to the remaining
grant funding groups. FAA has not yet allocated $350 million of the up to $2 billion in grant funding available to primary
airports. FAA oﬃcials stated that this funding may be used to increase the federal share to 100 percent for grants
awarded for airport infrastructure projects, or distributed to commercial service airports.
Page 386
GAO-21-387

obligated about $9.4 billion and expended over $5.4 billion to reimburse airports for eligible costs
and to increase the federal share for 2020 AIP grants, according to FAA oﬃcials (see table).
Page 387
GAO-21-387

FAA Obligations and Expenditures for CARES Act Airport Grants by Funding Group, as of February 14, 2021
Funding group
Obligations
($ millions)
Expenditures
($ millions)
1) Increase federal share for 2020 Airport Improvement Program (AIP) grantsa
509
220
2) Commercial service airportsb
7,123
4,673
3) Primary airportsc
1,629
469
4) General aviation airportsd
100
53
Total
9,361
5,415
Source: GAO analysis of CARES Act, Pub. L. No. 116-136, 134 Stat. 281 (2020) and data from the Federal Aviation Administration (FAA). | GAO-21-387
aNational system airports are eligible to receive federal funding from AIP grants for infrastructure development. The CARES Act
appropriated at least $500 million to increase the federal share to 100 percent for grants awarded for airport infrastructure
projects under ﬁscal year 2020 and supplemental discretionary grants.
bCommercial service airports are publicly owned airports with at least 2,500 passenger boardings per year and scheduled air
service. The CARES Act appropriated at least $7.4 billion in funding to airports in this funding group, and allocated funds based
on a formula that considers an airport’s passenger boardings, the airport sponsor’s debt service, and the sponsor’s ratio of
unrestricted reserves to debt service.
cPrimary airports are large, medium, and small hub and non-hub airports with more than 10,000 passenger boardings per year.
The CARES Act appropriated up to $2 billion in funding to airports in this funding group, and allocated funds based on statutory
AIP entitlement formulas. This funding group may also include non-primary commercial service airports with 8,000 to 9,999
passenger boardings. CARES Act, div. B, tit. XII, para. (3), 134 Stat. at 597.
dGeneral aviation airports are public-use airports with fewer than 2,500 passenger boardings per year and no scheduled air
service. The CARES Act appropriated at least $100 million in funding to airports in this funding group, and allocated funds based
on the categories these airports are placed in given activity measures (e.g., volume and type of ﬂights) and other factors in the
most current National Plan of Integrated Airport Systems.
Following the enactment of the Consolidated Appropriations Act, 2021, Federal Aviation
Administration (FAA) oﬃcials determined individual airport allocations in February 2021, based
on calendar year 2019 enplanement data—the most recent data available—and published
updated guidance.615 As of February 2021, FAA had not yet obligated or expended Consolidated
Appropriations Act, 2021 funds for grants to airports.
Overview of Key Issues
Airport grant administration and monitoring. With regard to CARES Act funding, FAA has
continued to process CARES Act airport grant applications, obligate funds, and review invoices
to reimburse airport sponsors. As of February 14, 2021, FAA had processed CARES Act grant
applications for 3,228 U.S. airports, including territories and tribes, totaling about $8.86 billion.
615The Consolidated Appropriations Act, 2021 directed FAA to allocate the unallocated CARES funds under the
Consolidated Appropriations Act, 2021 allocation formula and conditions for primary airports. In February 2021, FAA
allocated $290,774,557 of unallocated CARES Act funding to primary airports’ Consolidated Appropriations Act, 2021
awards based on each airport’s proportional share of 2019 enplanements. The 31 airports that received CARES Act
allocations in excess of four times their annual operating expenses are excluded from receiving this funding.
Page 388
GAO-21-387

Since we last reported in November 2020, FAA had also taken additional actions to oversee
and monitor compliance with workforce retention requirements for the 130 aﬀected airports
mentioned previously. FAA oﬃcials said that as of January 2021, all 130 airports complied with
September and December reporting requirements, and FAA had not received any waiver requests.
Oﬃcials also said they will continue to track workforce requirements for the Consolidated
Appropriations Act, 2021, and will compare airport workforce numbers to those from March 2020
to ensure airports meet the 90 percent threshold.
As we previously reported, FAA has identiﬁed challenges to administering and monitoring CARES
Act airport grants, including the need to process grants for over 3,000 airport sponsors under
expedited time frames, with expanded eligible uses for these funds. To address the increased
workload of processing and monitoring these grants, FAA rehired annuitants in September 2020,
who are primarily responsible for reviewing CARES Act payment requests and quickly processing
payments, according to FAA oﬃcials. FAA also revised and simpliﬁed requirements to allow
airport sponsors to submit a detailed invoice summary with each payment request in lieu of
individual invoices.616 Additionally, FAA issued updated guidance on December 3, 2020 to provide
consolidated information to airports about eligibility determinations. FAA oﬃcials also reported
that the agency hired a contractor in the fall of 2020 to review FAA’s invoicing processes, develop a
monitoring dashboard, develop auditing policies and procedures, and compare those procedures
to other federal programs.
In January 2021, FAA established the Airport Coronavirus Response Grant Program to administer
the $2 billion in funds from the Consolidated Appropriations Act, 2021, and in February, issued
guidance for airports. FAA guidance states that airports will apply for the funds using the SF-424,
Application for Federal Assistance form, similar to the CARES Act and AIP grant funding process, by
June 30, 2021, and must use the funds within 4 years. As previously mentioned, as of February
2021, FAA oﬃcials have determined airport grant allocation amounts. Airports that received more
than four times their operating budget from the CARES Act funds are not eligible for Consolidated
Appropriations Act, 2021 funding.617
As part of the Consolidated Appropriations Act, 2021 requirements, airport sponsors that accept
tenant relief funds will waive rent and minimum annual guarantee obligations for eligible airport
tenants—which may include on-airport car rental and parking, and in-terminal concession
tenants—beginning December 27, 2020, until the relief has equaled the total tenant relief
allocation amount to the extent permissible under state and local laws. To administer the tenant
relief portion of the funding, FAA oﬃcials have published additional guidance and a video
presentation to instruct airport sponsors on how to claim and use airport tenant relief funds, and
to ensure compliance.
616However, FAA oﬃcials said that they may still request individual invoices from airport sponsors if there are
outstanding questions from the information provided on the invoice summary.
617As we reported in June 2020, the grant formula in the CARES Act and available data for calculating the awards for
commercial service airports (i.e., passenger boardings, debt service, and the ratio of unrestricted reserves to debt
service) resulted in some small airports being allocated large amounts relative to their passenger activity or annual
operating budgets. For example, some airports that reported unrestricted reserves but no debt service, and relatively
few annual passenger boardings in 2018, were allocated nearly $17 million; amounts that greatly exceeded annual
operating budgets. FAA then limited each airport’s initial CARES Act airport grant to no more than four times its annual
operating expenses, unless the remaining amount would be less than $1 million.
Page 389
GAO-21-387

Airport grant funding uses. Airport association representatives told us that the federal funding
provided has been critical to the survival of the industry. FAA has begun to collect data from
airports on general spending categories for CARES Act funding through grant close-out reports,
but oﬃcials said that they have limited information until airport sponsors draw down all funds
for reimbursed costs. While FAA collects these data, oﬃcials said airports are generally using
CARES Act funds on payroll, utilities, minor maintenance, and debt service. Although FAA oﬃcials
have not yet obligated or expended any Consolidated Appropriations Act, 2021 funding, airport
associations said that airport sponsors generally plan to use these grants to pay for operational
expenses and costs related to mitigating eﬀects of the COVID-19 pandemic, such as cleaning and
sanitation, social distancing measures, and upgrading heating and cooling systems.
Agency Comments
We provided DOT and the Oﬃce of Management and Budget (OMB) with a draft of this enclosure.
DOT and OMB did not provide comments on this enclosure.
Methodology
To conduct this work, we reviewed FAA data on airport funding as of February 14, 2021, which
we found to be reliable for the purposes of describing allocations, obligations, and expenditures
through interviews with agency oﬃcials and reviewing relevant documentation. We also reviewed
federal laws and agency guidance related to the CARES Act and the Consolidated Appropriations
Act, 2021 and conducted interviews with agency oﬃcials and representatives from airport
associations, selected to represent a wide variety of industry and airport types.
Contact information: Heather Krause, (202) 512-2834 or krauseh@gao.gov
Related GAO Product
Airport Infrastructure: Information on Funding and Financing for Planned Projects. GAO-20-298.
Washington, D.C.: February 13, 2020.
Page 390
GAO-21-387

International Trade
U.S. imports of COVID-19-related products in December 2020 remained higher than pre-pandemic
levels, and over the course of the pandemic, U.S. Customs and Border Protection has taken actions
to facilitate trade.
Entity involved: U.S. Customs and Border Protection, within the Department of Homeland
Security.
Key Considerations and Future GAO Work
We plan to continue to monitor the eﬀect of COVID-19 on international trade and the medical
supply chain, potentially including challenges in facilitating trade of COVID-19-related products. For
more information, see the Domestic Medical Product Manufacturing enclosure in appendix I.
Background
The COVID-19 pandemic has disrupted businesses around the world and international
supply chains. According to the World Trade Organization (WTO), world merchandise exports
decreased by 4 percent in the third quarter of 2020 over the previous year. This was a signiﬁcant
improvement from the 21 percent decline in the second quarter of 2020, as production resumed
and lockdown measures were eased in major economies.618 U.S. imports of COVID-19-related
products, such as face masks, ventilators, gloves, and hand sanitizers, have ﬂuctuated. U.S.
Customs and Border Protection (CBP) is tasked with facilitating lawful trade, and has taken steps to
address issues that aﬀect U.S. imports and exports of such essential products.
Overview of Key Issues
Available data indicate that U.S. imports of product categories related to the COVID-19 response
decreased by 4 percent from October to December 2020 (see ﬁgure).619 However, even with a
decline in recent months, as of December 2020, imports of these products were 27 percent higher
compared to a year ago and had increased by 27 percent since February 2020. Many factors that
aﬀect product availability, such as supply chain constraints and export restrictions, and product
demand could drive trends in imports of COVID-19 products. Additionally, total import value
trends are related to changes in prices. For example, the unit value of N95 respirators fell by more
than 60 percent from July to December 2020, according to the United States International Trade
Commission (USITC), which could be linked to decline in personal protective equipment (PPE)
import values. Overall, the need for medical supplies in response to the pandemic explains the
increase in imports of these products since early 2020.
618 https://www.wto.org/english/res_e/statis_e/daily_update_e/merch_value_latest.pdf
619These product categories were identiﬁed by the U.S. International Trade Commission (USITC) in its report, COVID-19
Related Goods : U.S. Imports and Tariﬀs, Investigation No. 332-576, USITC Publication 5073 (Washington, D.C.: June 2020). A
revision to the Harmonized Tariﬀ Schedule on July 1, 2020, provided several new HTS-10 statistical reporting numbers for
previously identiﬁed COVID-19-related product categories. We identiﬁed these product categories and included them in
the analysis.
Page 391
GAO-21-387

Monthly U.S. Imports of COVID-19-Related Products by Product Type, January 2018 to December 2020
Notes: Census trade statistics, a widely used source analyzing U.S. international trade, do not contain precise data on imports
of COVID-19-related products. As a result, we estimated the import value of all product categories and types using Harmonized
Tariﬀ Schedule of the United States (HTS) statistical reporting numbers and associated product groupings listed by the U.S.
International Trade Commission (USITC) in COVID-19 Related Goods: U.S. Imports and Tariﬀs, Investigation No. 332-576, USITC
Publication 5073 (Washington, D.C.: June 2020). A revision to the Harmonized Tariﬀ Schedule on July 1, 2020, provided several
new HTS-10 statistical reporting numbers for previously identiﬁed COVID-19-related product categories. We identiﬁed these
product categories and included them in the analysis. Some HTS categories represent more than one product, and some
categories contain products that are not directly relevant to COVID-19 responses. Product types only refer to the subset
of goods considered COVID-19-related in each HTS-10 statistical reporting number. Therefore, the values presented may
overestimate the imports of products directly relevant to COVID-19 responses. Nevertheless, they are useful indicators for
tracking import trends of such products. For more information on factors inﬂuencing import trends in diﬀerent types of
COVID-19-related products, see USITC, COVID-19 Related Goods: The U.S. Industry, Market, Trade and Supply Chain Challenges,
Investigation No. 332-580 (December 2020).
Imports of COVID-19-related products from China, which accounted for close to 14 percent of such
imported products in December 2020, continued to decline, and imports of the same products
from the rest of the world declined after experiencing a month of growth.620 Imports from China
decreased by 8 percent (from roughly $2.7 billion to $2.4 billion) from October to December 2020,
after declining by 27 percent from September 2020 to October 2020 (from roughly $3.7 billion to
$2.6 billion).621 Meanwhile, imports of COVID-19-related product categories from other countries
declined by 3 percent (from $15.6 billion to $15.1 billion) from October 2020 to December 2020,
after increasing by 7 percent (from $14.5 billion to $15.6 billion) from September to October 2020.
620Some Harmonized Tariﬀ Schedule of the United States categories identiﬁed in USITC Publication 5073 represent
more than one product, and some categories contain products that are not directly relevant to COVID-19 responses.
Product types only refer to the subset of goods considered COVID-19-related in each HTS-10 statistical reporting
number. Therefore, the values presented may overestimate the imports of products directly relevant to COVID-19
responses. Nevertheless, they are useful indicators for tracking import trends of such products.
621Some imports from China have been subject to tariﬀs imposed by the Oﬃce of the U.S. Trade Representative at the
direction of the President under Section 301 of the Trade Act of 1974 since 2018.
Page 392
GAO-21-387

CBP has taken actions to address challenges related to the COVID-19 pandemic. CBP oﬃcials
reported operational challenges during the pandemic. For instance, CBP has had to conduct
virtually many of its trade-related activities that had previously been conducted in person, such as
processing of shipments and visiting brokers and importers. In addition, due to access restrictions
at ports, those in the importing and exporting community shifted to digitizing all documents—a
process many of them needed to learn. CBP oﬃcials also reported challenges related to the surge
in imports of COVID-19-related products. Speciﬁcally, CBP oﬃcials explained that there were
challenges related to the increase of new importers, such as state and local governments that
were importing COVID-19-related products for the ﬁrst time and that were unfamiliar with the
paperwork, procedures, and applicable duties.
Among other activities, CBP implemented the following actions to address these challenges and
support importers experiencing ﬁnancial hardships since the beginning of the pandemic:
• Established COVID-19 Cargo Resolution Team (CCRT). Related to the increase of new importers,
in April 2020, CBP created the CCRT to respond to questions about importing and exporting
medical supplies and PPE. The CCRT is a multidisciplinary team that also coordinates with
ports and other government agencies, such as the Food and Drug Administration (FDA) and
Federal Emergency Management Agency (FEMA), to facilitate shipments of medical supplies,
PPE, syringes and other vaccination supplies, and Pﬁzer’s COVID-19 vaccine. According to
CBP oﬃcials, by late January 2021 the CCRT had responded to almost 3,000 questions and
facilitated 373 Operation Warp Speed shipments valued at an estimated $69 million. CBP
oﬃcials also reported that between April and June 2020 CBP facilitated clearance of more than
400 FEMA-arranged ﬂights full of critical medical supplies.
• Participated in FEMA’s Export Cargo Review Working Group. CBP is part of FEMA’s Export Cargo
Review Working Group. The Export Cargo Review Working Group reviews shipments, provides
advice to FEMA regarding implementation of the allocation order, and periodically evaluates
the categories of health and medical resources included in the Temporary Final Rule for
Prioritization and Allocation of Certain Scarce and Critical Health and Medical Resources for
Domestic Use.622
• Seized counterfeit, illicit, or prohibited materials. According to CBP oﬃcials, CBP has seized
thousands of COVID-19-related products that are counterfeit, illicit, or prohibited, including
test kits, face masks, hand sanitizers, and various medicines.623
• Temporarily postponed certain duties, taxes, and fees for certain importers. According to CBP
oﬃcials, upon instruction from the Secretary of the Treasury, CBP temporarily postponed
certain duties, taxes, and fees for 2,921 importers experiencing a COVID-19-related ﬁnancial
622Prioritization and Allocation of Certain Scarce and Critical Health and Medical Resources for Domestic Use,
Temporary Final Rule, 85 Fed. Reg. 86,835 (Dec. 31, 2020).
623As of December 31, 2020, CBP oﬃcials reported seizures of 177,579 COVID-19 test kits prohibited by FDA; about
14.7 million counterfeit face masks; 36,839 antivirus lanyards prohibited by the Environmental Protection Agency;
6,379 tablets of antibiotics, such as azithromycin; and 37,884 tablets of chloroquine or hydroxychloroquine; as well
as 299,778 seizures of counterfeit and illicit hand sanitizers.
Page 393
GAO-21-387

hardship in March or April 2020.624 In total, these importers paid over $575 million under
extended deadlines.625
Agency Comments
We provided a draft of this enclosure to CBP and the Oﬃce of Management and Budget. They had
no comments on this enclosure.
Methodology
To conduct this work, we reviewed the most recent trade statistics from the U.S. Census Bureau
combined with USITC data on product categories that contain COVID-19 products.626 In addition,
we reviewed agency announcements and guidance from CBP and interviewed CBP oﬃcials.
By reviewing agency documents and conducting consistency checks, we found the data to be
suﬃciently reliable to describe trade in COVID-19-related products.
Contact information: Kimberly Gianopoulos, (202) 512-8612, gianopoulosk@gao.gov
624Speciﬁcally, in April 2020, the Secretary of the Treasury, in consultation with CBP, temporarily postponed the
deadline for importers of record with a signiﬁcant ﬁnancial hardship to deposit certain estimated duties, taxes,
and fees that they would ordinarily be obligated to pay as of the date of entry, or withdrawal from warehouse
for consumption, for merchandise entered in March or April 2020, for a period of 90 days from the date that the
deposit would otherwise have been due but for the emergency action. See 85 Fed. Reg. 22,349 (Apr. 22, 2020).
625According to CBP oﬃcials, as of early February 2021, approximately $1.7 million of the $575 million postponed
had not been paid, and CBP followed existing procedures to follow up on these unpaid duties, taxes, and fees. The
temporary postponement applies to federal excise taxes on imported products. The temporary postponement
does not apply to merchandise subject to antidumping duties, countervailing duties, or duties assessed pursuant to
Section 232 of the Trade Expansion Act of 1962 or Sections 201 or 301 of the Trade Act of 1974.
626We compared COVID-19-related HTS-10 codes both prior to and after July 1, 2020. If no match was found, we checked
USITC guidance to determine if the original code had been annotated or discontinued. If annotated or discontinued,
we included imports of those codes after July 1, 2020, in our analysis. For instance, according to guidance provided by
the USITC, products under 4818.50.0000 were to be split into two new HTS-10 product categories: 4818.50.0080 and
4818.50.0020. Therefore, we included imports for products contained in 4818.50.0080 and 4818.50.0020 after July 1,
2020, in our calculations.
Page 394
GAO-21-387

International Humanitarian Assistance
The Department of State and U.S. Agency for International Development have obligated all $908
million of supplemental COVID-19 humanitarian assistance funding, but policy changes delayed
USAID’s obligations, according to oﬃcials.
Entities involved: Department of State and U.S. Agency for International Development
Key Considerations and Future GAO Work
As part of our ongoing review of supplemental COVID-19 humanitarian assistance, we will review
the challenges the pandemic crisis has presented to the Department of State (State) and U.S.
Agency for International Development (USAID) in managing program monitoring.
Background
The COVID-19 pandemic has created new humanitarian needs and exacerbated existing
vulnerabilities around the world. The United Nations (UN) estimated that 270 million people
worldwide would be acutely food insecure by the end of 2020—an increase from 149 million
before the COVID-19 pandemic. The UN also estimated that there were more than 79 million
forcibly displaced people in July 2020, with those numbers expected to continue rising.
Congress appropriated $908 million in supplemental funding in ﬁscal year 2020 for international
humanitarian assistance activities.627 Speciﬁcally, the Coronavirus Preparedness and Response
Supplemental Appropriations Act and the CARES Act provided a total of $350 million for Migration
and Refugee Assistance programming, managed by State’s Bureau of Population, Refugees, and
Migration (PRM), and $558 million for International Disaster Assistance programming, managed by
USAID’s Bureau for Humanitarian Assistance (BHA).628
Overview of Key Issues
State had fully obligated its supplemental humanitarian assistance funding as of August
26, 2020, using a preexisting process. State approved its ﬁrst award of $64 million from the 2020
627The Coronavirus Preparedness and Response Supplemental Appropriations Act, 2020, and the CARES Act
appropriated about $2.3 billion for diplomatic and foreign assistance programming administered by State and USAID,
to respond to COVID-19 abroad. This supplemental funding included $908 million appropriated to the International
Disaster Assistance account and the Migration and Refugee Assistance account. See Pub. L. No. 116-123, tit. IV, 134
Stat. at 153; Pub. L. No. 116-136, div. B, tit. XI, 134 Stat. at 590. In March 2021, the American Rescue Plan Act of 2021
appropriated funds for Global Response and Humanitarian Response. See Pub. L. No. 117-2, tit. X, §§ 10003-04, 135
Stat. at 239. According to State oﬃcials, all $500 million appropriated for Humanitarian Response will go to the MRA
account. According to USAID oﬃcials, they anticipate programming the $3.09 billion appropriated for Global Response
through the Act for international disaster relief, rehabilitation, and reconstruction, for health activities, and to meet
emergency food security needs. Discussion about funding in this enclosure does not include the funds appropriated by
the American Rescue Plan Act of 2021.
628USAID established BHA in 2020, consolidating the former Oﬃce of U.S. Foreign Disaster Assistance and Oﬃce of
Food for Peace.
Page 395
GAO-21-387

supplemental Migration and Refugee Assistance funds on April 27, 2020. This approval constituted
about 18 percent of its $350 million in supplemental Migration and Refugee Assistance funding.
State had obligated nearly half of this supplemental funding by June 1, 2020. The ﬁgure below
shows the timing of State’s approval and obligation of supplemental humanitarian funding.
Timing of State Approval and Obligation of Supplemental Humanitarian COVID-Response Funding
According to State data, State obligated the $350 million in supplemental Migration and Refugee
Assistance funding through 21 awards spread across 68 countries. State data also show that the
vast majority of PRM’s supplemental awards (totaling about $339 million, or 97 percent) were
voluntary contributions to public international organizations.629 In making funding decisions,
PRM considered these organizations’ appeals for funding to support their worldwide COVID-19
responses. For example, PRM’s planning for its award of $64 million took into account emergent
needs and priorities detailed in the UN High Commissioner for Refugees’ Coronavirus Emergency
Appeal.630 According to PRM, the remaining awards (totaling about $11 million, or 3 percent) went
primarily to nongovernmental organizations with which PRM had preexisting programs.
Because voluntary contributions to public international organizations support multisectoral
activities and are designed to provide ﬂexibility to the organizations, PRM oﬃcials were unable
to itemize the humanitarian assistance obligations by sector, according to the oﬃcials. However,
629According to State guidance, voluntary contributions are discretionary ﬁnancial assistance provided to public
international organizations, among other institutions, which are meant to directly support the activities of the
organization or to sustain its general budget and operations. While the funds may be used to advance speciﬁc activities
and goals of the U.S. government, the central purpose of the funds is to enable the recipient to carry out its activities.
According to State oﬃcials, this means that generally U.S. voluntary contributions cannot be traced to speciﬁc activities
within a given country, since the funding is pooled with resources from other donor countries.
630This funding appeal fell under the umbrella of theUN’s consolidated Global Humanitarian Response Plan: COVID-19.
The UN plan and its subsequent updates consolidated the COVID-19 response needs of various UN humanitarian
agencies into a single funding appeal.
Page 396
GAO-21-387

according to PRM, its awards supported humanitarian partners as they pivoted to undertake
COVID-19 prevention, mitigation, and response measures on behalf of PRM’s populations of
concern: refugees, conﬂict victims, internally displaced persons, stateless populations, and
vulnerable migrants. These populations can be highly vulnerable to COVID-19 because of their
reduced access to health care and their location in congested areas, such as refugee camps,
according to PRM oﬃcials. PRM funding also supported broader community and national public
health systems’ pandemic responses.
State programmed its supplemental Migration and Refugee Assistance funding through
PRM’s Policy and Program Review Committee process—a preexisting, PRM-speciﬁc process
that seeks to engage bureau-level stakeholders in strategy and funding decisions. According
to PRM, the process includes speciﬁc procedures for emergency response. For COVID-19
supplemental funding, the committee approved 11 funding memorandums, each detailing
proposed implementers, programming, and monitoring approaches. According to PRM oﬃcials,
because of the rapidly evolving pandemic situation, PRM made a policy decision to fund only
current partners to undertake additional COVID-19-related programming in their current locations.
PRM oﬃcials stated that this additional programming was discussed in PRM’s weekly internal
COVID-19 programming meetings and coordinated with BHA in weekly program coordination
meetings, and funding decisions were consolidated and shared with State’s Coronavirus Global
Response Coordination Unit; however, the overall programming process was very similar to PRM’s
existing emergency processes.
USAID had fully obligated its supplemental humanitarian assistance funding as of July 31,
2020, using a new process. USAID approved country-level allocations for its ﬁrst tranche of $110
million—about 20 percent of the $558 million in supplemental International Disaster Assistance
funding—on March 26, 2020. By June 1, 2020, it had obligated $27.9 million, or 5 percent of the
total funding. The ﬁgure below shows the timing of USAID’s approval of tranched funding and
obligation of supplemental humanitarian funding.631
631The USAID funding approval date was determined by the date the USAID Administrator or Acting Administrator
signed the USAID Action Memo approving the transmittal of funds.
Page 397
GAO-21-387

Timing of USAID Approval and Obligation of Supplemental Humanitarian COVID-Response Funding
According to USAID data, USAID obligated the $558 million in supplemental International Disaster
Assistance funding through 188 awards in 43 countries. According to USAID data and oﬃcials,
initial programming primarily focused on augmenting ongoing health interventions and water,
sanitation, and hygiene support to mitigate widespread transmission of COVID-19, address public
health consequences, and maintain essential health services for crisis-aﬀected populations.
Subsequent programming aimed to address the longer-term food-security and economic impacts
of COVID-19 in humanitarian settings to prevent a further deterioration of preexisting crises,
according to USAID data and oﬃcials. The table below shows USAID’s total obligations for
supplemental humanitarian assistance by programming sector.
Page 398
GAO-21-387

USAID Supplemental International Disaster Assistance Obligations, by Programming Sector
Sector
Total obligated, in dollars
Nutrition and Food Assistance
189,342,490
Health
136,890,850
Water, Sanitation, and Hygiene
115,270,666
Logistics
59,863,966
Protectiona
23,568,653
Multipurpose Cash Assistance
13,734,813
Humanitarian Coordination and Information Management
8,719,255
Agriculture and Food Security
5,218,735
Humanitarian Policy, Studies, Analysis, or Applications
1,644,836
Shelter and Settlements
1,564,664
Economic Recovery and Market Systems
1,490,034
Risk Management Policy and Practice
691,038
Total
558,000,000
Source: U.S. Agency for International Development (USAID) data. | GAO-21-387
aUSAID deﬁnes protection programming as activities that support the needs of vulnerable populations such as women,
children, persons with disabilities, and elderly-headed households.
USAID obligated its supplemental COVID-19 funding through a new process that required BHA
to coordinate with a series of newly established entities at USAID and State prior to senior
leadership approval of proposed funding plans.632 According to BHA oﬃcials, USAID developed
this centralized process to ensure that its awarding of supplemental COVID-19 funding was
coordinated, approved, and publicly announced in discrete tranches in tandem with State. The
process comprised the following steps:
• BHA developed country prioritizations and preliminary funding plans through its regional
teams on the basis of factors such as disease presence and implementing partner capacity.
• BHA regional teams, in close coordination with technical teams and BHA’s newly established
COVID-19 Response Management Team, reviewed and coordinated these preliminary plans
632BHA oﬃcials noted that the process for COVID-19 funding diﬀered from processes used in other emergencies. For
example, during the Syria crisis, the USAID Disaster Assistance Response Team coordinated with ﬁeld teams throughout
the region on funding decisions without waiting for external approvals.
Page 399
GAO-21-387

with the USAID COVID-19 Task Force and other groups in USAID and State to ensure that the
plans aligned with the joint USAID and State COVID-19 Response Strategy.633
• On the basis of feedback from those groups, BHA and the Response Management Team
revised the plans for further review and ﬁnal leadership approval.
• State and USAID publicly announced BHA’s and other bureaus’ funding plans by country as
part of a speciﬁc funding tranche.
• Once the tranche was approved, BHA reviewed potential partner applications, awarded grants
and cooperative agreements, and obligated funding.
USAID disbanded the USAID COVID-19 Task Force on September 9, 2020, and the COVID-19
Response Management Team on October 31, 2020. According to BHA, USAID has integrated
COVID-19 activities into regularly funded programming in ﬁscal year 2021.
Policy changes delayed USAID’s obligation of supplemental humanitarian funding. According
to BHA oﬃcials, policy changes from the White House and USAID COVID-19 Task Force delayed
the agency’s obligations of supplemental humanitarian assistance funding. These policy changes
consisted of (1) restrictions on the procurement of personal protective equipment (PPE), (2) USAID
leadership’s reevaluation of existing branding and marking waivers in high-threat environments,
and (3) a government-wide restriction on funding for the World Health Organization (WHO).634
In addition, BHA oﬃcials said that delays stemming from the policy changes were sometimes
exacerbated by challenges related to the tranche approval process.635
Delays related to PPE funding restriction. On March 20, 2020, the USAID COVID-19 Task Force
notiﬁed BHA that no USAID funds could be used to procure PPE.636 According to BHA oﬃcials,
this restriction not only jeopardized implementing partners’ ability to protect their staﬀ and safely
proceed with humanitarian programming but also created funding delays.
BHA encouraged partners to use alternative donor funding for PPE, and regional teams were
encouraged to explore alternative programming that was not reliant on PPE. However, according
to BHA oﬃcials, it was initially unclear how to handle applications that had already been submitted
with PPE components, which constituted most applications. Speciﬁcally, the restriction notice
did not specify which types of PPE were covered or whether USAID would make exceptions for
633These groups included other USAID operating units, USAID’s Technical Working Group, and State’s Coronavirus
Global Response Coordination Unit and Oﬃce of Foreign Assistance.
634According to PRM oﬃcials, these issues did not aﬀect State’s obligation of supplemental humanitarian assistance.
635USAID’s Oﬃce of Inspector General noted delays in obligating supplemental humanitarian assistance and questioned
whether this response aligned with the typical approach of moving funds for humanitarian assistance quickly to places
in need. U.S. Agency for International Development, Oﬃce of Inspector General, Top Management Challenges Facing USAID
in Fiscal Year 2021 (Nov. 13, 2020).
636According to USAID’s Oﬃce of Inspector General, USAID oﬃcials said this decision was made under the advisement
of the USAID COVID-19 Task Force based on direction from the White House Coronavirus Task Force to oﬀset the
shortage of PPE for domestic health care workers. U.S. Agency for International Development, Oﬃce of Inspector
General, Top Management Challenges 2021.
Page 400
GAO-21-387

emergency humanitarian programming. Furthermore, the Task Force did not allow BHA to ask
partners to resubmit their applications to exclude programming requiring PPE, which delayed
action on those applications for approximately 7 weeks, according to oﬃcials.637 BHA oﬃcials
estimated that such delays aﬀected 49 awards in 21 countries, with a total value of over $100
million. For example, in Syria, awards for more than $18.5 million for ﬁve partners were delayed
because PPE was necessary for program implementation, according to BHA.
On June 9, 2020, the USAID COVID-19 Task Force approved revised guidance on award language
that loosened the restriction by allowing procurement of PPE without prior USAID authorization
under speciﬁed conditions.638 According to BHA oﬃcials, implementing partners indicated that
they were able to operate without much diﬃculty once they were permitted to procure PPE under
these conditions.639
Delays related to reevaluation of branding waivers. On March 24, 2020, the USAID COVID-19 Task
Force informed BHA that USAID leadership wanted to reevaluate existing branding and marking
waivers meant to ensure the safety of staﬀ and beneﬁciaries in high-threat environments.640
According to USAID documentation, this decision reﬂected USAID leadership’s intent to fully
publicize U.S. contributions in response to the pandemic. However, after surveying its partners,
BHA estimated on March 31, 2020, that this decision would prevent implementation of nearly half
of the COVID-19 supplemental humanitarian programming that USAID had approved at that point
($52.3 million of $110 million) in at least 11 high-priority countries and would prevent all proposed
activities in nine of the countries. For example, no partners were willing to proceed with award
implementation in Syria without a branding and marking waiver because of the inherent risks to
their staﬀ.
The reevaluation of branding and marking waivers aﬀected USAID’s obligations of COVID-19
supplemental humanitarian funding until April 27, 2020, when the USAID Acting Administrator
637On May 8, 2020, the USAID COVID-19 Task Force approved guidance on award language that, among other things,
speciﬁed the types of equipment covered by the restriction and conﬁrmed zero exception for humanitarian funding.
638The guidance stated that implementing partners must generally seek prior written approval from USAID to procure
listed commodities, which included some types of PPE. However, the guidance also explained that partners could
procure PPE without prior USAID authorization in the following two situations: (1) for their staﬀ, from any source; and
(2) for the protection of beneﬁciaries of USAID programs, from PPE manufactured locally or in the same region where
USAID is providing assistance, as long as the PPE is not, and could not reasonably be, intended for the U.S.
639On February 22, 2021, BHA oﬃcials told us that the Bureau for Management had approved a limited waiver for local
and regional PPE procurement that will remain in place through April 30, 2021. The oﬃcials also stated that the new
administration was reviewing the policy on PPE procurement.
640USAID policy mandates that all agency assistance be identiﬁed as American aid, except in rare circumstances. USAID
policy states that branding refers to the naming and communication of USAID’s sponsorship of the program, project, or
activity and that marking refers to aﬃxing USAID identity or other approved logos to the deliverables associated with a
program, project, or activity. See U.S. Agency for International Development, Automated Directives System, section 320.1.
According to USAID policy, principal oﬃcers may grant a waiver on determining that USAID-required markings would
pose compelling political, safety, or security concerns or that marking would have an adverse impact in the host country.
In truly exceptional circumstances, the principal oﬃcer may approve a blanket waiver by region or country. See U.S.
Agency for International Development, Automated Directives System, section 320.3.2.6.
Page 401
GAO-21-387

approved the pre-existing waivers for selected countries and programs. According to BHA, until
this reapproval, aﬀected programming was fully paused.641
Delays related to government-wide pause on WHO funding. On April 14, 2020, President Trump
instructed the administration to halt funding to WHO. As a result, ﬁve awards worth $31 million
to WHO were paused pending further guidance, according to BHA. BHA oﬃcials noted that WHO
is the primary organization for coordinating health-related humanitarian responses with local
and national authorities. BHA oﬃcials also told us that some governments grant WHO exclusive
authorities, largely because of WHO’s role as the UN Health Cluster lead agency.
Because of the restriction on WHO funding, BHA staﬀ were required to identify new implementing
partners and restart the application review process, which aﬀected overall programming and
further delayed obligation of funds, according to BHA oﬃcials. Ensuring that the new partners
were capable of providing the needed interventions and soliciting new applications took additional
time, the oﬃcials said.
However, USAID ﬁeld teams for several countries—Afghanistan, Libya, the Democratic Republic
of the Congo, Sudan, Ethiopia, Iraq, and Syria—reported being unable to identify implementing
partners with capacity comparable to WHO’s. For example, before the restriction was announced,
USAID was in conversation with WHO to supply medical equipment in northwest Syria. After
the restriction was announced, BHA was able to ﬁnd partners for alternative activities in the
region, but these activities did not replace the proposed WHO projects, according to BHA oﬃcials.
The oﬃcials stated that in certain settings, WHO operates as the provider of last resort—that
is, as the sole provider of health care for some populations. BHA oﬃcials told us that although
they were able to ﬁnd alternative partners for most projects, no other organizations had the
capacity, technical capability, and access required to conduct the needed programming for some
projects.642
Challenges related to tranche approval process. According to BHA oﬃcials, challenges related
to the new tranche approval process exacerbated delays stemming from the policy changes.
Until funding was approved through the tranche process and BHA knew how much would be
allocated for speciﬁc countries, it could not begin to receive and review applications from potential
implementers, according to oﬃcials. In addition, BHA oﬃcials said that the public announcement
of funding levels by country, combined with new restrictions on adjusting the announced funding
levels after approval, eliminated BHA’s ﬂexibility to revise its funding plans if needs or conditions
changed.
Agency Comments
We provided a draft of this enclosure to State, USAID, and the Oﬃce of Management and Budget
(OMB) for comment. State and USAID provided technical comments, which we incorporated as
appropriate. In its comments, reproduced in appendix XI, USAID stated that it would build on
641BHA oﬃcials reported that as of February 22, 2021, current branding regulations and policy continue to apply to
USAID awards, and partners must continue to follow the branding requirements in their awards.
642On January 20, 2021, President Biden reversed the decision to withdraw from the WHO.
Page 402
GAO-21-387

the lessons learned over the past year and would continue to adapt program management and
internal policies for the new operational context. State and OMB did not provide formal written
comments on this enclosure.
Methodology
To conduct this work, we reviewed ﬁnancial data from State’s State Assistance Management
System and USAID’s Phoenix database. To assess the data’s reliability, we reviewed agency
responses to data reliability questions, noting the speciﬁc tagging required for COVID-19
supplemental funding. We also compared the data we received with the data State and USAID
reported to Congress and with original approval documentation. We found that the data we
received were suﬃciently reliable for describing obligation and programming information for
COVID-19 supplemental programming. We also reviewed documentation and interviewed relevant
oﬃcials at State and USAID.
Contact information: Chelsa Kenney, (202) 512-2964 or kenneyc@gao.gov.
Page 403
GAO-21-387

Bureau of Prisons’ COVID-19 Spending and Response
About $775 million from a combination of sources has been either appropriated to or designated
by the Federal Bureau of Prisons for COVID-19 response eﬀorts.643 This includes $100 million
in CARES Act supplemental funds, which the Bureau has already expended.644 The Bureau has
periodically modiﬁed its operations and amended its plans for responding to the pandemic in
response to evolving federal and other guidance.
Entity involved: Federal Bureau of Prisons, within the Department of Justice
Key Considerations and Future GAO Work
We are monitoring the Federal Bureau of Prisons’ (BOP) COVID-19 response and recovery eﬀorts
to address the pandemic, including its obligation and expenditure of funds. Speciﬁcally, our
ongoing work will address the extent to which BOP’s response to the pandemic has evolved to
incorporate changing guidance and best practices. We will also address the reported impact of the
pandemic on BOP-managed and private prison facilities, inmates, and staﬀ.645
Background
BOP, a component within the Department of Justice (DOJ), was responsible for the care and
custody of approximately 152,000 inmates, as of February 25, 2021. Because inmates and
approximately 37,000 BOP staﬀ live and work in conﬁned spaces and in close proximity to
each other, the prison population has been particularly vulnerable to COVID-19. Further, about
12 percent of the federal prison population is over age 55, and many have underlying health
conditions such as diabetes and chronic heart disease—two factors that further increase the risk
for severe illness from the virus that causes COVID-19.
As of February 25, 2021, BOP reported that 47,860 inmates and 6,490 staﬀ had contracted
COVID-19. BOP also reported that 222 inmates and four staﬀ had died from it.646 BOP is
implementing a phased action plan to reduce the spread and manage the virus's impact on
inmates and staﬀ.
643According to Department of Justice oﬃcials, as of January 2021, the Bureau of Prisons deobligated $24.34 million in
ﬁscal year 2020 obligations that the Bureau had previously reported for COVID-19 obligations, reducing the total amount
to approximately $750 million.
644Pub. L. No. 116-136, 134 Stat. 281, 513 (2020).
645Approximately 80 percent of federal inmates are conﬁned in a BOP-managed facility. Depending on their
circumstances, such as required security level or length of time remaining on their sentence, others are living in home
conﬁnement; conﬁned in a contracted, privately operated prison; or living in a Residential Reentry Center designed to
help facilitate their return to the community.
646BOP uses diﬀerent methods for tracking and reporting infection and death rates among inmates and staﬀ. We are
examining its methods as part of our ongoing work.
Page 404
GAO-21-387

About $775 million from a combination of sources has been either appropriated to or designated
by the Federal Bureau of Prisons for COVID-19 response eﬀorts.647 Speciﬁcally, the CARES Act
appropriated $100 million to BOP for preventing, preparing for, and responding to the COVID-19
pandemic. Additionally, the Consolidated Appropriations Act, 2021, appropriated $300 million to
BOP for preventing, preparing for, and responding to COVID-19, domestically or internationally.648
Further, according to BOP oﬃcials, BOP obligated about $375 million from its ﬁscal years 2020 and
2021 Salaries and Expenses appropriation for COVID-19 expenses. Oﬃcials from BOP explained
that funds from all three sources are to be used for, among other things, personal protective
equipment, cleaning supplies, and contracts for medical care provided outside BOP facilities.
As our work continues, we plan to examine the speciﬁc obligations and expenditures from each
source in detail.
Overview of Key Issues
BOP’s modiﬁed operations for the pandemic response and the impact on its inmates. BOP
had a pandemic response plan in place before the onset of the COVID-19 pandemic. BOP oﬃcials
told us that they developed the plan for responding to a ﬂu pandemic speciﬁcally and as such, the
plan did not address the unique challenges the COVID-19 pandemic presented, such as the rapidly
spreading nature of the virus. BOP therefore supplemented the existing plan with additional
guidance from the BOP Medical Director regarding identifying and screening for COVID-19, starting
on January 31, 2020. Additionally, on February 29, 2020, the Bureau issued its phase 1 action plan.
This plan was the ﬁrst in a multiphased planning approach. According to BOP oﬃcials, the intent
was to modify operations to adapt to evolving guidance from the Centers for Disease Control and
Prevention (CDC) and others in direct response to the changing conditions of the pandemic.
In addition to guidance provided in the action plans, BOP modiﬁed operations at all 122 of its
prison facilities in an eﬀort to maximize social distancing. As of February 22, 2021, BOP was
implementing its phase 9 action plan.649 This plan includes restrictions or a suspension of inmates’
access to people, areas, and programs as the primary mechanism for social distancing and curbing
spread of the virus. Speciﬁcally, BOP restricted inmates’ in-person access to legal counsel and
social visitors such that access was to be granted based upon request and the availability of
space to allow for adequate social distancing. BOP also completely restricted social visitations for
inmates in isolation or quarantine. Similarly, BOP restricted inmates’ access to areas such as the
commissary, laundry room, and showers to small groups of inmates at a time, and only if inmates
practiced established guidelines for social distancing.
Lastly, while BOP continues to oﬀer inmates access to certain programs, such as drug abuse,
General Educational Development, and anger management classes, it has restricted the capacity
647According to Department of Justice oﬃcials, as of January 2021, BOP deobligated $24.34 million in ﬁscal year 2020
obligations that BOP had previously reported for COVID-19 obligations, reducing the total amount to approximately $750
million.
648Pub. L. No. 116-260 (Section 543 of Division B of the Consolidated Appropriations Act, 2021)(Dec. 27, 2020).
649BOP updated its phase 9 action plan for the COVID-19 pandemic response on November 25, 2020.
Page 405
GAO-21-387

of these programs, in some cases to no more than six participants at a time. It has also scheduled
them in outdoor or otherwise unused spaces in an eﬀort to maximize safety and social distancing.
Our ongoing study of BOP’s response to the pandemic will examine more fully how BOP modiﬁed
its operations to incorporate evolving guidance from CDC and others. Our work will also describe
the impact these modiﬁcations had on its inmates, staﬀ, and institutions.
BOP’s policy and procedures for screening and testing inmates and staﬀ. BOP’s COVID-19
testing strategy is contained in its COVID-19 phased action plans. BOP oﬃcials said that the
strategy has changed multiple times since the beginning of the pandemic to adapt to changing
CDC guidance and as BOP addressed challenges in obtaining testing supplies. On July 31, 2020,
BOP awarded a contract to a national laboratory in an eﬀort to help improve its COVID-19 testing
capacity and strategy for inmates; however, BOP does not have a universal testing policy for
inmates or staﬀ. While some BOP facilities have conducted targeted or mass testing of their
inmates when facing COVID-19 outbreaks, BOP’s policy is to test inmates only if they become
symptomatic, if they have had contact or suspected contact with a COVID-19 positive individual,
and before they are transferred in or out of a BOP institution. BOP does not test staﬀ on site,
but refers them to community testing resources and requires staﬀ to report testing results if
the results are positive. Our ongoing work on BOP’s response to the pandemic will examine the
speciﬁc policies and procedures BOP has established for screening and testing staﬀ for COVID-19.
BOP’s methods for tracking data on inmate and staﬀ infections and deaths. BOP tracks
information on inmates and staﬀ who have tested positive, recovered from, and died of COVID-19
on a daily basis and per facility, and reports this information on its public website. We are
assessing the methods BOP uses to track this information, including measures it has taken and
continues to take, to ensure accuracy and reliability of the data. We also continue to examine the
extent to which BOP’s data collection eﬀorts include inmates housed in privately run, contracted
facilities.
Agency Comments
We provided a draft of this enclosure to the Department of Justice and the Oﬃce of Management
and Budget (OMB) for review and comment. Department of Justice oﬃcials provided technical
comments, which we incorporated as appropriate. OMB did not provide comments on this
enclosure.
Methodology
To address our objectives, we conducted virtual site visits at six BOP facilities, which we selected
based on criteria such as geographic location, facility security level, and COVID-19 infection
rate. At these facilities we interviewed facility management oﬃcials as well as representatives
of the BOP employees’ union. We also interviewed oﬃcials at BOP’s Central Oﬃce who oversee
COVID-19 policies, reviewed BOP documents, and analyzed BOP data and written responses to
our questions. We assessed the reliability of obligations data by interviewing knowledgeable
Page 406
GAO-21-387

oﬃcials about their ﬁnancial management systems and how the data are used, and found the data
suﬃciently reliable for our purposes.
Contact information: Gretta L. Goodwin, (202) 512-8777, goodwing@gao.gov
Page 407
GAO-21-387

Reporting of COVID-19 Supplemental Spending Data
In the year since the passage of the CARES Act, the number and features of federal websites
that track and report on COVID-19 supplemental spending have grown considerably, including
a new section of USAspending.gov and the launch of PandemicOversight.gov.650 Progress has
been made to align these sites with key practices for transparently reporting data. However,
Treasury can take further action on our 2017 recommendation to disclose known data limitations
on USAspending.gov by implementing a more systematic approach for identifying and disclosing
them.
Entities involved: Department of Health and Human Services; Department of Labor; Oﬃce
of Management and Budget; Pandemic Response Accountability Committee; Small Business
Administration; Department of the Treasury
Key Considerations and Future GAO Work
Our work examining the quality and display of COVID-19-related and other spending data
available on USAspending.gov is ongoing. We will continue to review the extent to which the
spending data submitted and displayed on USAspending.gov are timely, complete, and accurate,
including whether information regarding limitations is disclosed. We are also examining the use
and usefulness of COVID-19 and other federal spending data available from USAspending.gov,
PandemicOversight.gov, and the Department of the Treasury’s (Treasury) Data Lab website.
Background
The CARES Act contains several requirements for federal agencies and nonfederal entities
receiving federal awards for the timely reporting of covered funds.651 Oﬃce of Management
and Budget (OMB) guidance issued in April 2020 made some modiﬁcations to the existing
framework of reporting requirements for emergency or disaster relief spending already in place.
These modiﬁcations allowed agencies to meet many CARES Act reporting requirements using
USAspending.gov, which tracks federal contracts, ﬁnancial assistance (which includes grants and
loans), and other federal spending at the state, congressional district, and local levels.652
The CARES Act required the Pandemic Response Accountability Committee (PRAC) to create a
website—PandemicOversight.gov—in part to foster greater accountability and transparency
in COVID-19 spending.653 The website displays COVID-19 spending data sourced from
USAspending.gov, federal agencies, and Inspectors General oﬃces.654 Treasury’s Data Lab website
650Pub. L. No. 116-136, 134 Stat. 281 (2020).
651Pub. L. No. 116-136, §§ 15010, 15011, 134 Stat. at 533–42.
652OMB memorandum M-20-21 notes that some provisions may be excluded from this requirement, and in these
instances, agencies should work with their OMB representative to identify an alternative reporting approach to provide
transparency on how the funds are spent.
653Pub. L. No. 116-136, § 15010(g)(1)(A), 134 Stat. at 539.
654For this enclosure, we deﬁne “COVID-19 spending” as supplemental spending addressing COVID-19 from the
following statutes: Coronavirus Preparedness and Response Supplemental Appropriations Act, 2020, Pub. L. No.
Page 408
GAO-21-387

supplements COVID-19 spending information on USAspending.gov by providing a broader view
of COVID-19 spending across agencies. The website also includes information to explain how
COVID-19 spending moves from appropriations to individuals and businesses.
In the year since the passage of the CARES Act, the number and features of federal websites that
track and report on COVID-19 spending have grown considerably. Many agencies—such as the
Department of Health and Human Services (HHS), the Department of Labor (DOL), and the Small
Business Administration (SBA)—added spending data for individual COVID-19 programs to their
websites.655 Unlike USAspending.gov and PandemicOversight.gov, these websites sometimes do
not include data analysis or visualization features besides lists or tables.
See the table below for more information on the characteristics of the three federal websites that
provide government-wide COVID-19 spending data.
116-123, 134 Stat. 146 (2020); Families First Coronavirus Response Act, Pub. L. No. 116-127, 134 Stat. 178 (2020);
Paycheck Protection Program and Health Care Enhancement Act, Pub. L. No. 116-139, 134 Stat. 620 (2020); Coronavirus
Aid, Relief, and Economic Security Act or the CARES Act, Pub. L. No. 116-136, 134 Stat. 281 (2020); Consolidated
Appropriations Act, 2021, Pub. L. No. 116-260, 134 Stat. 1182 (2021); and American Rescue Plan Act of 2021, Pub. L. No.
117-2, 135 Stat. 4 (2021).
655The Congressional Research Service provides a list of agency websites with COVID-19 spending data. See Jennifer
Teefy and Maria Kreiser, Resources for Tracking Federal COVID-19 Spending, accessed February 18, 2021, https://
www.crs.gov/Reports/R46491?source=search.
Page 409
GAO-21-387

Federal Agency Websites Reporting Government-wide COVID-19 Spending Data
USAspending.gov a
• Oﬃcial source of spending data
for the U.S. government. Includes
information on COVID-19 spending
enacted under various acts.d
• Displays total COVID-19 spending
obligations and outlays by agency,
federal account, and object class.
• Displays COVID-19 award
obligations, outlays, and loan face
value by recipient, agency and sub-
agency, and Catalog of Federal
Domestic Assistance Program listing.
Coverage includes contracts, grants,
loans, direct payments, and other
ﬁnancial assistance.e
• Data for individual prime awards
include total and nonfederal
funding, total and COVID-19
obligated amounts, and COVID-19
outlayed amounts.
• Among the COVID-19 spending not
speciﬁcally reported by agencies:
•
Provider Relief Fund
payments to individual
providersf
•
Federal Medical Assistance
Percentage spending
attributable to the
Families First Coronavirus
Response Actf
•
Subrecipient awards for
Coronavirus Relief Fundf
•
COVID-19 spending by
14 small independent,
legislative branch, and
judicial branch entitiesg
PandemicOversight.gov b
• Data displayed are sourced
from USAspending.gov, federal
agencies, and Inspectors General
oﬃces.
• Unlike USAspending.gov, the
website includes Coronavirus
Relief Fund subrecipient data
originating from the Department
of the Treasury Oﬃce of the
Inspector General, including
subaward amount and money
spent to date. The website also
identiﬁes Paycheck Protection
Program (PPP) recipients and
visualizes PPP loan totals by
state, county, industry, and
business type.
Data Lab c
In contrast to the two other websites,
Data Lab only provides aggregated
government-wide COVID-19 spending
data. However, users can view the
following information:
• Breakdown of COVID-19 ﬁnancial
relief by statute.
• Total estimated value of
legislation, including new agency
funding and tax relief.
• Total estimated lending for
credit, loans, and loan guarantee
programs.
• Diagram of the process used
to move COVID-19 spending
through the full budget lifecycle
to the American people
(including appropriations,
obligations, and outlays).
• How much of the COVID-19
funding has been spent. This
includes outlays and obligated
and unobligated amounts by
appropriation.
Sources: USAspending.gov, PandemicOversight.gov, Data Lab website, and Congressional Research Service. | GAO-21-387
Note: Web links to identiﬁed URLs were active as of February 19, 2021. The table excludes agency websites that report spending
for individual COVID-19 programs.
aSee https://www.usaspending.gov/disaster/covid-19.
bSee https://www.pandemicoversight.gov/.
cSee https://datalab.usaspending.gov/federal-covid-funding.
Page 410
GAO-21-387

dCoronavirus Preparedness and Response Supplemental Appropriations Act, 2020, Pub. L. No. 116-123, 134 Stat. 146 (2020);
Families First Coronavirus Response Act, Pub. L. No. 116-127, 134 Stat. 178 (2020); Paycheck Protection Program and Health
Care Enhancement Act, Pub. L. No. 116-139, 134 Stat. 620 (2020); Coronavirus Aid, Relief, and Economic Security Act or the
CARES Act, Pub. L. No. 116-136, 134 Stat. 281 (2020); Consolidated Appropriations Act, 2021, Pub. L. No. 116-260, 134 Stat. 1182
(2021); and American Rescue Plan Act of 2021, Pub. L. No. 117-2, 135 Stat. 4 (2021).
eOMB Memorandum M-20-21 requires agencies to provide a funding identiﬁer—a Disaster Emergency Funding Code (DEFC)—in
their ﬁnancial ﬁle submissions to track and report contracts funded by COVID-19 supplemental spending. OMB M-10-21 also
requires agencies to use a separate National Interest Action (NIA) code for all procurement actions (e.g. contracts) reported into
the Federal Procurement Data System-Next Generation that are related to the COVID-19 response. However, use of the NIA
code is not necessarily tied to COVID-19 supplemental appropriations. As a result, awards with the COVID-19 NIA value may not
have a COVID-19 DEFC value, and vice versa. Because of this diﬀerence in how COVID-19 related contract awards are tagged
with DEFC and NIA codes, it may be unclear to a user of USAspending.gov that the DEFC-based COVID-19 spending numbers
presented on the site do not capture the entirety of federal spending on procurement actions for COVID-19 relief and response
eﬀorts. See the Federal Contracts and Agreements for COVID-19 enclosure in Appendix I for information on contract obligations
in response to COVID-19 tracked in the Federal Procurement Data System-Next Generation.
fAccording to Treasury oﬃcials, COVID-19 spending for the listed awards, payments, and Federal Medical Assistance Percentage
spending attributable to the Families First Coronavirus Response Act was not covered because agencies adhered to Oﬃce of
Management and Budget policy or otherwise declined to report such spending to USAspending.gov.
gThe following 10 entities received COVID-19 funding but do not report any spending information under the Digital
Accountability and Transparency Act of 2014 to USAspending.gov: the Architect of the Capitol; Capitol Police; Courts of
Appeals, District Courts, and Other Judicial Services; Defender Services; House Oﬃce of the Attending Physician; House of
Representatives; Library of Congress; Senate (miscellaneous); Sergeant at Arms and Doorkeeper of the Senate; and U.S.
Supreme Court. The Department of the Treasury (Treasury) told us that COVID-19 spending for three other entities—the
Corporation for Public Broadcasting, Federal Payment for Emergency Planning and Security Costs in the District of Columbia,
and Legal Services Corporation—is coded as Treasury spending. Treasury also told us that COVID-19 spending for a fourth
entity—Historically Black College and University Capital Financing—is coded as Department of Education spending. Therefore,
it is not possible for a user to obtain speciﬁc information on COVID-19 spending for these four entities apart from overall
spending reported by the Departments of the Treasury and Education.
Overview of Key Issues
Treasury and PRAC have taken steps to align COVID-19 spending data websites with key
practices for transparently reporting data and identifying data limitations. In a December
2018 report, we identiﬁed several key practices to help ensure the transparent presentation
of government data, including by presenting data in a way that helps users to easily explore
them. Key actions to implement these practices include providing tools such as interactive
maps and visualizations and search functions to help users ﬁnd information or display search
results using tables, charts, and maps. We also reported in December 2018 and November
2019 on the importance of being transparent about the quality of the information presented on
USAspending.gov, including the value of clearly identifying data limitations.
Interactive maps, visualizations, and search. Since the CARES Act was enacted in March 2020,
Treasury added new features enabling users to view and download COVID-19 spending data on
USAspending.gov. For instance, users can view USAspending.gov’s COVID-19 Spending Proﬁle
Page for an overview of the federal funding response to the COVID-19 pandemic.656 In addition,
the COVID-19 Spending Proﬁle Page uses an interactive map to display obligations and outlays
through grants, contracts, loans, and other assistance by state, county, or congressional district.
656See https://www.usaspending.gov/disaster/covid-19, accessed February 19, 2021. The COVID-19 Spending Proﬁle
Page includes details on total obligations and outlays by agency, federal accounts, and object classes. Users can see
obligations and outlays through diﬀerent award types by agency and by Catalog of Federal Domestic Assistance
program.
Page 411
GAO-21-387

Treasury enhanced USAspending.gov’s Advanced Search feature so that users can ﬁlter search
results by Disaster Emergency Funding Code (DEFC) to show COVID-19 spending awards.657 The
search results table includes columns containing COVID-19 obligations and outlays for each
award, and displays COVID-19 spending by state, locality, or congressional district. Treasury also
enhanced its Data Lab website to allow users to explore how COVID-19 funding makes its way
from Congress into the economy.658
In February 2021, PRAC added data transparency and completeness to its list of top management
challenges facing federal agencies in responding to and providing relief for COVID-19.659 In 2020,
PRAC launched PandemicOversight.gov, which presents COVID-19 spending data through a
variety of interactive visual displays. For example, the website’s funding overview page includes
graphics showing funding totals by category—such as state, local, and tribal governments,
higher education, and small businesses—and funding by category for the top 10 agencies
receiving COVID-19 funding.660 The website uses maps to visualize COVID-19 spending data from
USAspending.gov, the Coronavirus Relief Fund, and the Paycheck Protection Program. Users may
also access the website’s Pandemic Response Funding portal to view COVID-19 obligation and
spending data in graphs and tables that answer several basic questions, including “Where is the
money being spent?,” “Who is spending the money?,” and “How is the money being spent?”661
PandemicOversight.gov also allows users to ﬁlter data by agency, location, type of assistance,
or key word. The website’s presentation of COVID-19 spending data and search functions
enhance transparency and help ensure that Congress and the public can quickly and easily ﬁnd,
understand, and analyze the data.
Transparency regarding information quality and data limitations. Treasury has also taken steps to
disclose known data quality issues and limitations on USAspending.gov, as we recommended in
November 2017. Consistent with our recommendation, in August 2020, Treasury began disclosing
some data limitations for COVID-19-related spending on USAspending.gov. At that time, Treasury
reported data limitations for four COVID-19 programs administered by various agencies.
Treasury expanded this list over time. On January 8, 2021, the list was updated to include
data limitations for six COVID-19 programs administered by federal agencies.662 This includes
information from speciﬁc federal agencies on reporting issues that may aﬀect the accuracy or
completeness of COVID-19 data displayed on the USAspending.gov, as well as web links to detailed
657See https://www.usaspending.gov/search/?hash=7580e2b7e64603db1eba0c65c6b1caf2, accessed February 19, 2021.
Users can search for COVID-19 spending awards by ﬁltering by DEFC and selecting “COVID-19 Spending.”
658See https://datalab.usaspending.gov/federal-covid-funding#section-overview, accessed February 18, 2021.
659Pandemic Response Accountability Committee, UPDATE: Top Challenges in Pandemic Relief and Response (Washington
D.C.: Feb. 3, 2021).
660See https://www.pandemicoversight.gov/track-the-money/funding-overview, accessed February 18, 2021.
661See https://www.pandemicoversight.gov/track-the-money/funding-charts-graphs/pandemic-response-funding,
accessed February 18, 2021.
662See https://www.usaspending.gov/data/data-limitations.pdf, accessed February 18, 2021.
Page 412
GAO-21-387

information on COVID-19 programs that HHS did not make available on USAspending.gov.663
These disclosures are an important step toward more fully identifying and disclosing known
COVID-19 data limitations on USAspending.gov.
PandemicOversight.gov also provides information on COVID-19 spending data limitations in a list
of frequently asked questions (FAQs). The website describes limitations regarding data obtained
through USAspending.gov as well as other sources, such as SBA and Treasury’s Oﬃce of Inspector
General (OIG). The website also discloses reasons why modiﬁcations to an award may result in
the display of negative or zero amounts. A PRAC oﬃcial told us that PRAC is planning to be more
speciﬁc about limitations in data obtained from USAspending.gov in a forthcoming update to its
FAQs.
Treasury has opportunities to further disclose COVID-19 spending data limitations. For example,
USAspending.gov does not disclose that it does not publish or break out $272.6 million in
COVID-19 spending by 14 entities—including for the U.S. Supreme Court, Architect of the Capitol,
and Corporation for Public Broadcasting—which received COVID-19 funding.664 In contrast,
PandemicOversight.gov notes that USAspending.gov does not include COVID-19 spending data for
these entities. Although COVID-19 spending by the 14 entities is small compared to total COVID-19
spending government-wide, users will not know about limitations in data by legislative and judicial
branch agencies without Treasury’s clear identiﬁcation of such limitations on USAspending.gov.
Treasury oﬃcials told us that the department has focused its eﬀorts on identifying the most
signiﬁcant COVID-19 spending data limitations on USAspending.gov. However, Treasury has agreed
to review data limitations that GAO and other sources have identiﬁed. Treasury can help users
make better use of COVID-19 spending data on USAspending.gov or identify other sources of data,
if necessary, by more fully communicating information about the completeness of data displayed
on the website.
Treasury has taken some positive steps to further disclose limitations related to COVID-19
spending data. For example, Treasury demonstrated for us a planned page for inclusion in
USAspending.gov that would automate updates related to certain data limitations. However,
we believe that additional action can be taken to implement a more systematic approach to
identifying and disclosing known data limitations, consistent with our 2017 recommendation.
Such an approach could include procedures for addressing wide-ranging issues including
communicating changes in reporting requirements or information about data that may be
unreported or incomplete. This, in turn, would help users better understand potential data
quality issues as well as how to appropriately interpret the data. We will continue to monitor
663HHS provided links to public use ﬁles for its Provider Relief Fund and COVID-19 Uninsured Program. The data HHS
submitted to USAspending.gov only reﬂects obligations to a single entity that is processing payments and claims
reimbursements on behalf of HHS.
664Treasury told us that COVID-19 spending for three of the 14 entities—the Corporation for Public Broadcasting,
Federal Payment for Emergency Planning and Security Costs in the District of Columbia, and Legal Services
Corporation—is coded as Treasury spending. Treasury also told us that COVID-19 spending for a fourth
entity—Historically Black College and University Capital Financing—is coded as Department of Education spending.
Therefore, it is not possible for a user to obtain speciﬁc information on COVID-19 spending for these four entities apart
from overall spending reported by the Departments of the Treasury and Education. According to Treasury, the other 10
entities do not meet the deﬁnition of “agency” used in the Federal Funding Accountability and Transparency Act.
Page 413
GAO-21-387

Treasury’s eﬀorts in this area to determine whether they are suﬃcient to address our previous
recommendation.
Errors in tracking initial COVID-19 spending data caused discrepancies between outlays
and obligations reported on USAspending.gov. The CARES Act requires federal agencies to
report on the use of funds, and subsequently in April 2020, OMB directed agencies to change
their reporting periods for covered funds and to begin reporting obligations and expenditures
to USAspending.gov on a monthly basis.665 Further, OMB directed agencies to expand their
use of DEFCs to cover COVID-19 supplemental funding, while acknowledging that agencies may
not be able to track some spending using an appropriate DEFC value. OMB directed that these
reporting changes were eﬀective for April, May, and June 2020 data, which were to be included
with quarterly data submissions in August 2020.
Users of USAspending.gov identiﬁed issues aﬀecting their use of the USAspending.gov website,
including examples of COVID-19-related awards where reported award outlays were greater than
obligations. We analyzed the USAspending.gov database in January 2021 and identiﬁed COVID-19-
related awards in which outlays exceeded obligations at HHS, DOL, the Department of Education,
and SBA.666
According to agency oﬃcials from Treasury, DOL, HHS, and SBA, these discrepancies resulted from
errors in how data were DEFC-coded for initial award transactions prior to the OMB-mandated
changes eﬀective for April, May, and June 2020 data. For example, SBA oﬃcials told us that they
tagged COVID-19 transactions prior to June 2020 with an incorrect DEFC, while DOL oﬃcials told
us that they did not DEFC-tag obligations prior to June 2020. Additionally, HHS oﬃcials told us that
they did not DEFC-tag obligations prior to the third quarter of ﬁscal year 2020. In all cases, these
situations resulted in discrepancies between obligations and outlays for selected grants reported
on USAspending.gov.
Agency spending data submissions are validated by the DATA Act Broker, an intermediary service
that standardizes and formats agency-submitted data and assists reporting agencies in validating
their data before submitting them to Treasury. Treasury oﬃcials told us that while the DATA Act
Broker does not currently verify that outlays do not exceed obligations, they would consider
adding such a rule.
Some agencies we identiﬁed as having inconsistencies in this area are in the process of correcting
these errors and recertifying their data. For example, SBA oﬃcials told us that they have added a
validation process to check for discrepancies between outlays and obligations before submission
to USAspending.gov. DOL oﬃcials said that they are working with Treasury to address these errors.
Both SBA and DOL told us that they plan to validate outlays in their data submissions prior to
certiﬁcation in the future.
Within HHS, oﬃcials at the Centers for Disease Control and Prevention and the Administration
for Children and Families told us that they were working to internally address data issues. At the
665Pub. L. No. 116-136, § 15011(b)(1)(A), 134 Stat. at 541.
666We identiﬁed 257 HHS awards, nine DOL awards, eight SBA awards, and one Education award where outlays
exceeded obligations.
Page 414
GAO-21-387

department level, HHS oﬃcials from the Oﬃce of the Assistant Secretary for Financial Resources
(ASFR) told us that internal data for this period have since been correctly DEFC-tagged. Further,
these oﬃcials told us that while the department has no plans to resubmit corrected data to
USAspending.gov, corrected data are publically available through the HHS Tracking Accountability
in Government Grants System website. According to ASFR oﬃcials, HHS has not been required or
received a request from OMB to resubmit DEFC-tagged data.
If agencies implement these changes in correcting and recertifying data with discrepancies or add
speciﬁc data limitation disclosures to USAspending.gov, and verify that future data submissions
do not contain obligation and outlay discrepancies, users may be better able to understand
the limitations in using these data. We will continue to work with aﬀected agencies to ensure
discrepancies in reported data are addressed.
Agency Comments
We provided a draft of this enclosure to DOL, HHS, OMB, PRAC, SBA, and Treasury for review and
comment. HHS, OMB, PRAC, and Treasury provided technical comments, which we incorporated as
appropriate. DOL and SBA did not comment on the draft enclosure.
Methodology
To conduct this work, in January 2021, we reviewed federal COVID-19 DEFC-tagged spending data
available on USAspending.gov. We also reviewed federal COVID-19 spending data limitations
identiﬁed by USAspending.gov and PandemicOversight.gov.
We compared award-level COVID-19 outlays to obligations for all awards from USAspending.gov
tagged with COVID-19-related DEFC codes in ﬁscal years 2020 and 2021 until December 31, 2020.
We identiﬁed those awards with higher outlays than obligations and summarized the number of
awards and the total number of discrepancies by agency, DEFC, and object class. We found these
data from USAspending.gov to be suﬃciently reliable for our purposes of identifying awards with
obligation and outlay discrepancies. We interviewed or received written responses from Treasury,
HHS, DOL, and SBA to determine the source and reasons for the discrepancies.667 We further
interviewed or received written responses from PRAC oﬃcials and nongovernmental organizations
using spending data from USAspending.gov and PandemicOversight.gov.
Contact information: Michelle Sager, (202) 512-6806, sagerm@gao.gov.
Related GAO Products
DATA Act: Quality of Data Submissions Has Improved but Further Action Is Needed to Disclose Known
Data Limitations. GAO-20-75. Washington, D.C.: November 8, 2019.
667We did not reach out to Education because we only found one award where outlays exceeded obligations.
Page 415
GAO-21-387

Open Data: Treasury Could Better Align USAspending.gov with Key Practices and Search Requirements.
GAO-19-72. Washington, D.C.: December 13, 2018.
DATA Act: OMB, Treasury, and Agencies Need to Improve Completeness and Accuracy of Spending Data
and Disclose Limitations. GAO-18-138. Washington, D.C.: November 8, 2017.
Page 416
GAO-21-387

Federal Fraud-Related Cases
Federal agencies’ enforcement actions on fraud-related charges help protect consumers and
ensure that taxpayer dollars and government services related to COVID-19 serve their intended
purposes.
Entities involved: Government-wide
Key Considerations and Future GAO Work
We will continue our oversight of government-wide fraud risk management eﬀorts.
Background
The public health crisis, economic instability, and increased ﬂow of federal funds associated with
the COVID-19 pandemic present increased pressures and opportunities for fraud.668 By proactively
managing fraud risks, federal oﬃcials can help safeguard taxpayer dollars to ensure they serve
their intended purpose, particularly given that Congress has appropriated about $3.1 trillion as
of January 31, 2021, to fund COVID-19 response and recovery eﬀorts.669 According to GAO’s A
Framework for Managing Fraud Risks in Federal Programs, among other things, eﬀective managers
of fraud risks refer instances of potential fraud to Oﬃces of Inspector General (OIG) or other
appropriate parties, such as law enforcement entities or the Department of Justice, for further
investigation.
The extent of fraud associated with the COVID-19 relief funds appropriated to date has not
yet been determined. One of the many challenges is that because of fraud’s deceptive nature,
programs can incur ﬁnancial losses related to fraud that are never identiﬁed, and such losses are
diﬃcult to reliably estimate. However, several individuals have already pleaded guilty to federal
charges of defrauding COVID-19 relief programs—including the Small Business Administration’s
(SBA) Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) program
and the Department of Labor’s (DOL) unemployment insurance (UI) program—and numerous
others faced related federal charges as of January 31, 2021. In addition, federal hotlines have
received numerous complaints from the public alleging potential fraud involving COVID-19 relief
funds. For example, from March 13, 2020, through January 31, 2021, our hotline—known as
668Fraud and “fraud risk” are distinct concepts. Fraud—obtaining something of value through willful
misrepresentation—is challenging to detect because of its deceptive nature. Fraud risk (which is a function of likelihood
and impact) exists when individuals have an opportunity to engage in fraudulent activity, have an incentive or are under
pressure to commit fraud, or are able to rationalize committing fraud. Fraud risk management is a process for ensuring
program integrity by continuously and strategically mitigating the likelihood and impact of fraud. When fraud risks can
be identiﬁed and mitigated, fraud may be less likely to occur. Although the occurrence of fraud indicates there is a fraud
risk, a fraud risk can exist even if actual fraud has not yet been identiﬁed or occurred.
669An appropriation provides legal authority for federal agencies to incur obligations and make payments out of the
U.S. Treasury for speciﬁed purposes. The American Rescue Plan Act of 2021 provides additional relief to address the
continued impact of COVID-19 on the economy, public health, state and local governments, individuals, and businesses.
The Congressional Budget Oﬃce estimates the budgetary eﬀects of the law to be $1.9 trillion. Pub. L. No. 117-2, 135
Stat. 4.
Page 417
GAO-21-387

FraudNet—received over an estimated 1,500 complaints related to the CARES Act, many of which
involve SBA’s PPP and EIDL program and DOL’s UI program (see text box).
Report Fraud, Waste, and Abuse
GAO’s FraudNet supports accountability across the federal government. Allegations of fraud, waste, or abuse can be
submitted via the FraudNet portal or by calling the hotline at 1-800-424-5454.
Overview of Key Issues
Because of the economic eﬀects of COVID-19 and the government’s need to quickly provide
funds and other assistance to those aﬀected by it, federal relief programs are vulnerable to
signiﬁcant risk of fraudulent activities. The schemes used to defraud the government as well as
private businesses and individuals are endless, and many have emerged during the COVID-19
pandemic. Since March 2020, the Department of Justice has publicly announced charges in
numerous fraud-related cases.670 The charges—ﬁled across the U.S. and investigated by a range of
law enforcement agencies—include making false statements and engaging in identity theft, wire
and bank fraud, and money laundering. The number of individuals facing fraud-related charges
continues to grow and will likely increase, as these cases take time to develop.671
Fraud against federal programs. Forty-six individuals pleaded guilty to federal charges of
defrauding COVID-19 relief programs—including SBA’s PPP and EIDL program and DOL’s UI
program—from March 2020 through January 2021.672 For example:
• In one case, an individual pleaded guilty to fraudulently obtaining two PPP loans for over $2.5
million. The individual created fraudulent payroll documentation for two businesses, falsely
representing that the businesses had dozens of employees with millions of dollars in payroll
expenses, when in fact they had few, if any, employees.673 For more information on potential
PPP fraud, see the enclosure on the Paycheck Protection Program in appendix I.
• As part of another case, an individual pleaded guilty to wire fraud associated with a scheme to
defraud SBA’s PPP and EIDL program by providing false information on nine loan applications.
Six of the individual’s nine fraudulent loan applications were approved, and he fraudulently
670A charge is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable
doubt in a court of law.
671The statute of limitations for mail fraud and wire fraud prosecutions is 5 years (18 U.S.C. § 3282), except for mail
and wire fraud schemes that aﬀect a ﬁnancial institution, in which case the statute is 10 years (18 U.S.C. § 3293). Also,
based on our analysis, these cases can take many years to resolve. For example, the Department of Housing and Urban
Development OIG closed cases in 2017–2020 resulting from Hurricane Sandy in 2012.
672In November 2020, one of these individuals was sentenced to 12 months in prison and 2 years of supervised release.
In December 2020, another individual was sentenced to 24 months in prison and 5 years of supervised release. In
January 2021, a third individual was sentenced to 3 months in federal prison.
673The individual obtained approximately $2,501,753 in loan proceeds, and used these funds to pay for items
unrelated to any legitimate PPP-related expense, including an automobile, an aircraft, personal taxes, the down-
payment on a luxury residence, day-to-day living expenses, and various purchases of jewelry, clothing, accessories,
and shoes.
Page 418
GAO-21-387

obtained more than $700,000 in relief funds. For more information on potential fraud in the
EIDL program, see the enclosure on the Economic Injury Disaster Loan Program in appendix I.
• In another guilty plea, an individual admitted to involvement in a scheme to obtain fraudulent
UI program loans using stolen personal identity information. The individual obtained more
than $189,912 in fraudulent UI beneﬁts using approximately 70 stolen identities.674 For more
information on potential fraud in the UI programs, see the enclosure on Unemployment
Insurance Programs in appendix I.
As of January 31, 2021, federal charges were pending against 238 individuals for attempting to
defraud these programs. In addition, two individuals pleaded guilty to identity theft in connection
with economic impact payments (EIP), and related federal charges are pending against four
other individuals.675 These cases each involved individuals unlawfully obtaining the personal
identiﬁcation information of other individuals, ﬁling false tax returns, and obtaining EIPs.676 See
the ﬁgure below for the number of individuals who have pleaded guilty or faced federal charges
for fraud against COVID-19 relief programs as of January 31, 2021.677
674Oﬃcials from the National Association of State Workforce and its UI Integrity Center, funded by and operated
in partnership with DOL, said that identity theft remains the biggest challenge for states in addressing potential
UI fraud. According to oﬃcials, states have recently experienced increases in instances of criminals taking over
legitimate claimants’ UI accounts and rerouting beneﬁts to other bank accounts. In January 2021, we reported
that states are working to address these account takeovers through communication campaigns that raise public
awareness about phishing attempts to steal account information, as well as coordinating with law enforcement and
banking institutions.
675There are 23 individuals facing other charges, such as bank fraud related to counterfeit EIPs.
676In June 2018, we raised concerns about the Internal Revenue Service’s inability to securely authenticate taxpayers
online. For example, we recommended that the Internal Revenue Service develop a plan for implementing changes to
its online authentication programs consistent with new guidance and implement improvements to its systems to fully
implement the new guidance. As of January 2020, the agency had taken steps on these recommendations but had not
yet fully implemented them.
677The federal government may enforce laws through civil or criminal action. Such action may be resolved through a
trial, a permanent injunction, a civil settlement, or a guilty plea. For example, in January 2021, the Department of Justice
obtained a civil settlement for fraud against PPP. In this case, a company and its president and Chief Executive Oﬃcer
agreed to pay a combined $100,000 in damages and penalties to resolve allegations.
Page 419
GAO-21-387

Number of Individuals Facing Federal Charges or Who Have Pleaded Guilty to Fraud-Related Charges by
COVID-19 Relief Program, as of January 31, 2021
Note: The number of individuals presented in the ﬁgure exceeds the total number of individuals
who faced federal charges or pleaded guilty because some faced charges or pleaded guilty to
charges related to more than one federal program. Thirty individuals faced federal charges related
to both PPP and EIDL, and one individual faced federal charges related to both UI and EIP as of
January 31, 2021. Four individuals pleaded guilty to federal charges related to both PPP and EIDL
as of January 31, 2021.
In February 2021, an individual pleaded guilty to making false statements to multiple federal
agencies in order to fraudulently obtain COVID-19 emergency relief loans and multimillion-dollar
federal contracts.678 Speciﬁcally, this individual applied for PPP and EIDL loans on behalf of his
company, falsely overstating the number of employees and the amount of the company’s payroll.
This individual also used some of the loan proceeds for personal expenditures rather than to pay
employees or for other appropriate business expenses. The loss to the federal government from
this fraud is approximately $261,500.
In addition, this individual made false statements to the Department of Veterans Aﬀairs (VA)
and the Federal Emergency Management Agency (FEMA) in order to obtain lucrative contracts to
provide COVID-19 personal protective equipment (PPE). Based on the individual’s false statements,
VA and FEMA awarded his company contracts valued at $35,000,000 and $3,510,000, respectively.
The company failed to supply any PPE to VA and FEMA. While the federal government suﬀered no
ﬁnancial loss because the contract called for payment upon delivery and inspection of the goods,
according to the Acting U.S. Attorney for the Eastern District of Virginia, this individual’s “fraudulent
conduct during a critical time in our Nation’s ﬁght against COVID-19 undermined the government’s
ability to provide much needed PPE to the community.”
678Separate from COVID-19-related fraud, this individual also defrauded the Department of Veterans Aﬀairs by falsely
claiming to be entitled to veteran’s beneﬁts for serving in the U.S. Marine Corps when, in fact, he never served.
Page 420
GAO-21-387

Consumer fraud. In addition to fraud against federal programs, fraud can result in ﬁnancial
losses to consumers and undermine health and safety. Nine individuals or entities pleaded guilty
to federal charges related to consumer fraud from March 2020 through January 2021.679 For
example:
• In one case, an individual admitted to operating a website advertising the sale of PPE,
including respirator masks and protective masks. However, the individual did not provide the
PPE to the majority of customers, stealing at least $3,800. This individual pleaded guilty to wire
fraud.680
• In another case involving a fraud scheme related to the prevention or treatment of COVID-19,
an individual listed for sale online an unregistered pesticide, falsely claiming the product would
protect the buyer or wearer from viruses or bacteria.681 The individual pleaded guilty to one
count of distribution and sale of an unregistered pesticide.
As part of another case, the Department of Justice issued a permanent injunction to address
a fraud scheme related to COVID-19 testing. In this case, a business advertised and oﬀered to
perform a COVID-19 test that was not approved by the Food and Drug Administration. There
were also federal charges pending against 29 individuals or entities related to consumer fraud
as of January 31, 2021. In addition, the Federal Trade Commission and the Food and Drug
Administration have issued warning letters to companies for allegedly selling fraudulent COVID-19-
related products, including those making deceptive or scientiﬁcally unsupported claims about
their ability to treat or cure COVID-19.682 As of January 31, 2021, 38 individuals and entities had
pleaded guilty or faced federal charges for diﬀerent types of consumer fraud, including schemes
related to PPE sales, prevention or treatment, and testing (see ﬁgure).
679Two of the nine individuals or entities have also pleaded guilty to federal charges of defrauding COVID-19 relief
programs. In November 2020, one of the individuals was sentenced to 36 months of incarceration. Four individuals or
entities in other cases had been sentenced to 2 to 3 years of probation and ordered to pay ﬁnes as of January 31, 2021.
680This individual also pleaded guilty to mail fraud for a separate fraud scheme unrelated to COVID-19 relief funds.
Sentencing was consolidated into one proceeding and in November 2020, the individual was sentenced to 36
months of incarceration.
681In January 2021, we reported on a case with similar circumstances where an individual pleaded guilty to violating
the Federal Insecticide, Fungicide, and Rodenticide Act.
682The COVID-19 Consumer Protection Act, which became law in December 2020 as part of the Consolidated
Appropriations Act, 2021, gives the Federal Trade Commission authority to seek civil penalties on the ﬁrst oﬀense for
scams and deceptive practices related to the COVID-19 pandemic. Pub. L. No. 116-260, div. FF, tit. XIV, § 1401, 134 Stat.
1182, 3275-3276 (2020).
Page 421
GAO-21-387

Number of Individuals or Entities Who Have Pleaded Guilty to or Faced Federal Charges for Consumer Fraud, as
of January 31, 2021
aThis category includes individuals or entities that oﬀered or promoted products to prevent or treat COVID-19 prior to vaccines
becoming available.
As COVID-19 vaccines become available, another type of potential consumer fraud has emerged.
While the extent of vaccine-related fraud is unknown, U.S. Attorney’s Oﬃces have warned of fraud
schemes related to COVID-19 vaccines.683 Also, according to a December 2020 press release from
the Federal Bureau of Investigation (FBI), the FBI, Department of Health and Human Services OIG,
and Centers for Medicare & Medicaid Services have received complaints of scammers using the
public’s interest in COVID-19 vaccines to obtain personally identiﬁable information and money
through various schemes. As a result, these agencies have warned the public about several
emerging fraud schemes related to COVID-19 vaccines (see ﬁgure).684
683From March 2020 through January 2021, the Department of Justice publicly announced charges or other actions in
consumer fraud cases involving individuals who had claimed to oﬀer products or services to prevent COVID-19.
684In addition to these warnings, in December 2020, the Federal Trade Commission, together with the National
Association of Attorneys General, issued a blog post warning consumers about these types of scams.
Page 422
GAO-21-387

Examples of Consumer Warnings about COVID-19 Vaccine Scams
Other federal cases. The federal government is also pursuing charges including conspiracy,
wire fraud, and theft that are related to COVID-19 but separate from consumer fraud—including
vaccine-related fraud—and fraud against the federal programs discussed earlier. Nine individuals
pleaded guilty to these types of federal charges from March 2020 through January 2021.685 For
example, one individual—a hospital pharmacist—agreed to plead guilty to attempting to spoil
hundreds of COVID-19 vaccine doses. Another individual pleaded guilty to wire fraud related to
a scheme to defraud his employer by allegedly faking a positive COVID-19 medical excuse letter,
causing the employer to stop business and sanitize the workplace. This individual later admitted
that he did not have COVID-19. According to information presented in court, the closure of the
facility for cleaning and the cost of paying employees during the shutdown resulted in a loss in
excess of $100,000 to the corporation. There were also other federal charges pending against
22 individuals as of January 31, 2021. For example, two individuals were indicted on charges of
conspiracy, possession of stolen goods being shipped interstate, and theft of government property
for allegedly stealing 192 U.S. government-owned medical ventilators worth about $3 million.686
Agency Comments
We provided a draft of this enclosure to the Oﬃce of Management and Budget, which had no
comments.
685In October 2020, one individual was sentenced to 1 year and 1 day in prison, and ordered to pay restitution in the
amount of $221,200 for causing damage to a former employer and delaying the shipment of PPE during the COVID-19
pandemic. In January 2021, an individual was sentenced to 3 months in prison and 9 months of home conﬁnement,
and ordered to pay restitution in the amount of $132,291, for stealing COVID-19-related medical supplies to sell for the
individual’s own gain. Two individuals in other cases had been sentenced to 2 to 3 years of probation and ordered to pay
ﬁnes as of January 31, 2021.
686Following an investigation, law enforcement found most of the stolen ventilators.
Page 423
GAO-21-387

Methodology
To conduct this work, we reviewed information from the Department of Justice to identify federal
fraud-related charges related to COVID-19 relief funding as of January 31, 2021.
Contact information: Johana Ayers, (202) 512-6722, ayersj@gao.gov
Related GAO Products
Identity Theft: IRS Needs to Strengthen Taxpayer Authentication Eﬀorts. GAO-18-418. Washington, D.C.:
June 22, 2018.
A Framework for Managing Fraud Risks in Federal Programs. GAO-15-593SP. Washington, D.C.: July 28,
2015.
Page 424
GAO-21-387

Agriculture Spending on Payments to Producers
In 2020, federal direct payments and federal crop insurance net payments to agricultural
producers were projected to be about $52 billion ($46 billion in direct payments and $6 billion in
net crop insurance payments) representing 43 percent of about $121 billion in net farm income, of
which about $30 billion came from COVID-relief programs.
Entities involved: U.S. Department of Agriculture, including its Oﬃce of the Secretary
Key Considerations and Future GAO Work
We continue to examine the U.S. Department of Agriculture’s (USDA) spending and oversight of
COVID-relief and Commodity Credit Corporation funding.
Background
COVID-19 has caused disruptions in the U.S. food supply chain, from the farms where raw
agricultural commodities are produced to the food processing and distribution network that
enables these commodities to be used by consumers.687 Congress has appropriated billions of
dollars for the agricultural sector through coronavirus relief and other legislation. Speciﬁcally,
$19.7 billion was appropriated to USDA’s Oﬃce of the Secretary, and the Commodity Credit
Corporation’s borrowing authority was replenished in the amount of $45.8 billion across three
separate pieces of legislation.688 The Commodity Credit Corporation is a wholly government-
owned entity that ﬁnances a broad array of agriculture support programs. It has permanent
authority to borrow up to $30 billion at any given time from the Treasury.689 The speciﬁc amounts
appropriated are as follows:
• $8.5 billion to USDA’s Oﬃce of the Secretary through the CARES Act690
687COVID-19 aﬀected consumer prices for food. In May 2020, the U.S. Bureau of Labor Statistics reported that April 2020
saw the sharpest increase in grocery store prices since 1974.
688“Borrowing authority” is authority that permits agencies to incur obligations and make payments to liquidate the
obligations out of borrowed moneys. Borrowing from the Treasury is the most common form and is also known as
“public debt ﬁnancing.” GAO, Principles of Federal Appropriations Law, 4th ed., 2016 rev., ch. 2, p. 2-6, GAO-16-464SP
(Washington, D.C.: March 2016).
689The Commodity Credit Corporation Charter Act is codiﬁed at 15 U.S.C. §§ 714-714p. Many Commodity Credit
Corporation activities are authorized through omnibus farm bills—most recently the Agriculture Improvement Act
of 2018 (2018 farm bill), Pub. L. No. 115-334, 132 Stat. 4490. Farm bills direct programs (including commodity and
conservation programs) to utilize the Commodity Credit Corporation’s borrowing authority, thereby dispensing with the
need for an annual appropriation for individual programs.
690The CARES Act, Pub. L. No. 116-136, div. B, tit. I, 134 Stat. 281, 505 (2020), appropriated $9.5 billion to the Oﬃce
of the Secretary. The Consolidated Appropriations Act, 2021, Pub. L. No. 116-260, div. A, tit. VII, § 799C(b), 134 Stat.
1182, 1234, made $1 billion of the $9.5 billion available for other purposes. This reduced the amount available to
prevent, prepare for, and respond to coronavirus to $8.5 billion.
Page 425
GAO-21-387

• $14 billion to the Commodity Credit Corporation through the CARES Act691
• $23.9 billion to the Commodity Credit Corporation through the Continuing Appropriations Act,
2021, and Other Extensions Act692
• $11.2 billion to USDA’s Oﬃce of the Secretary through the Consolidated Appropriations Act,
2021693
• $7.9 billion to the Commodity Credit Corporation through the Consolidated Appropriations
Act, 2021694
In addition, USDA made available $6.5 billion for direct payments to agricultural producers from
funding that was generally available to the agency through the Commodity Credit Corporation
prior to the CARES Act reimbursement.695
See the table below for the funding amounts USDA made available to agricultural producers in the
form of direct payments through the Coronavirus Food Assistance Program (CFAP) 1 and 2 and
CFAP Consolidated Appropriations, 2021. These amounts are a subset of the amounts discussed
above that Congress provided in COVID relief and Commodity Credit Corporation reimbursements,
and the $6.5 billion USDA made available from previously available borrowing authority in the
Commodity Credit Corporation.
691Pub. L. No. 116-136, div. B, tit. I, § 11002, 134 Stat. at 509. Generally, appropriations acts enacted annually
reimburse the Commodity Credit Corporation for its net realized losses.
692 Pub. L. No. 116-159, div. A, § 173, 134 Stat. 709, 725 (2020).
693 Pub. L. No. 116-260, div. M, tit. VII, subtit. B, ch. 1, § 751, 134 Stat. 1182, 2105. Section 751 provides $11.2 billion
to USDA’s Oﬃce of the Secretary to prevent, prepare for, and respond to coronavirus by providing support for
agricultural producers, growers, and processors impacted by coronavirus. Among other things, section 751 provides
that at least $1.5 billion of the $11.2 billion be used to purchase food and agricultural products, including seafood,
to distribute to individuals in need.
694 Pub. L. No. 116-260, div. A, Tit II, 134 Stat. at 1199.
695The Commodity Credit Corporation Charter Act is codiﬁed as amended at 15 U.S.C. §§ 714-714p.
Page 426
GAO-21-387

Apportioned Amounts and Funding Sources for the Coronavirus Food Assistance Program (CFAP) Direct
Payments to Agricultural Producers as of January 19, 2021
Program
Apportioned amount a
($ billions)
Month b Funding source
Up to 6.5c
May 2020 CCC Charter Act authoritiesd
CFAP 1
Up to 9.5e
May 2020 Appropriations under the CARES Act
Up to 14.0f
September 2020 CCC Charter Act authorities
CFAP 2
Up to 0.1g
September 2020 Appropriations under the CARES Act
CFAP Consolidated
Appropriations, 2021
Up to 9.7h
January 2021 Consolidated Appropriations Act, 2021
Total
Up to 39.7
Source: GAO analysis of U.S. Department of Agriculture (USDA) data. | GAO-21-387
aThe apportioned amount column shows how much the Oﬃce of Management and Budget ﬁrst apportioned for the programs.
bThe month column shows when the Oﬃce of Management and Budget ﬁrst apportioned funding for the programs. The table
is dated as of January 19, 2021, because the apportionment for CFAP Consolidated Appropriations, 2021 was approved by the
Oﬃce of Management and Budget on that date.
cUSDA transferred $6.5 billion from the Commodity Credit Corporation (CCC) account to the Oﬃce of the Secretary account on
May 1, 2020.
dRecent laws that replenished the CCC include the CARES Act, Pub. L. No. 116-136, div. B, tit. I, § 11002, 134 Stat. at 509, which
reimbursed $14 billion of the Commodity Credit Corporation’s net realized losses.
eAccording to USDA oﬃcials, the previous administration reapportioned $0.5 billion of the $9.5 billion to the Farmers to
Families Food Box Program. The Consolidated Appropriations Act, 2021, subsequently reduced the original $9.5 billion by
repurposing $1 billion of that amount.
fUSDA transferred $14.0 billion from the CCC account to the Oﬃce of the Secretary account on September 16, 2020. USDA
received an early reimbursement of the CCC in the Continuing Appropriations Act, 2021 and Other Extensions Act, enacted on
October 1, 2020, for the net realized losses as of September 17, 2020. Pub. L. No. 116-159, div. A, § 173, 134 Stat. at 725 .
gThis $0.1 billion for CFAP 2 from the CARES Act is a subset of the $9.5 billion appropriation to USDA’s Oﬃce of the Secretary,
Pub. L. No. 116-136, div. B, tit. I, 134 Stat. at 505, and, therefore, this column does not total. The $0.1 billion will be used for
payments to tobacco producers.
hThe Oﬃce of Management and Budget apportioned $9.7 billion for “COVID-19 CFAP Consolidated Approps, 2021” in January
2021 from the Consolidated Appropriations Act, 2021.
USDA estimates that in 2020 agricultural producers obtained $5.9 billion dollars in Paycheck
Protection Program loans made available through the CARES Act. The agency forecasts that in
2021 agricultural producers will obtain $2.8 billion in Paycheck Protection Program loans made
available through the Consolidated Appropriations Act, 2021. Overseen by the Small Business
Administration, the Paycheck Protection Program provides forgivable loans to help businesses
keep their workforce employed during the coronavirus crisis. The table below shows the potential
amounts in forgiveness-eligible loans provided to agricultural producers through the Paycheck
Protection Program.
Page 427
GAO-21-387

Potential Amounts and Funding Sources for the Paycheck Protection Program (PPP) Loans to Agricultural
Producers, as of February 5, 2021
Program
Amount of Loans
($ billions)
Year Funding source
5.9a
2020 CARES Act
PPP
2.8b
2021 Consolidated Appropriations Act, 2021
Potential total
8.7
Source: GAO analysis of U.S. Department of Agriculture’s Economic Research Service Farm Income and Wealth Statistics. | GAO-21-387
Note: The Small Business Administration administers the PPP.
aFor calendar year 2020, the Economic Research Service reported $5.9 billion in PPP loans to entities primarily engaged
in production agriculture (North American Industry Classiﬁcation System codes 111 and 112) based on Small Business
Administration data released on November 24, 2020.
bFor calendar year 2021, the Economic Research Service projects $2.8 billion in PPP loans to entities primarily engaged in
production agriculture (North American Industry Classiﬁcation System codes 111 and 112).
Overview of Key Issues
In 2020, federal direct payments and federal crop insurance net payments to agricultural
producers were projected to be about $52 billion. This amount includes about $46 billion in
direct payments and $6 billion in crop insurance indemnities minus producer-paid premium
and represents 43 percent of $121 billion in net farm income, of which about $30 billion came
from COVID-relief programs.696 Accounting for about a fourth of net farm income, these COVID-
relief payments contributed to making 2020 the third highest year for farm income since 2008.
Without the COVID-relief payments, 2020 would have been the seventh highest farm income
year since 2008.697 The ﬁgure below shows the amount of federal direct payments (including
forgiveness-eligible loans) and federal crop insurance net payments (indemnities minus producer-
paid premium) to agricultural producers that contributed to net farm income from 2008 through
2021. The amounts for 2020 and 2021 are projections, which include estimates and forecasts.
696Dollar amounts are nominal. The Funding Amounts and Funding Sources for the Coronavirus Food Assistance
Program (CFAP) Direct Payments to Agricultural Producers table above provides the amounts the Oﬃce of Management
and Budget apportioned for diﬀerent rounds of CFAP. The apportioned amounts diﬀer from the USDA Economic
Research Service projections of actual payments. The Economic Research Service projects $29.6 billion to agricultural
producers from COVID-relief programs ($23.7 billion in Coronavirus Food Assistance Program payments and $5.9 billion
in Paycheck Protection Program forgiveness-eligible loans) in calendar year 2020. The agency estimates a total of $46.3
billion in federal direct payments, including the $29.6 billion from COVID-relief programs. We calculated $52 billion in
federal direct payments and net crop insurance payments by adding $46.3 billion in direct payments to $5.7 billion in
crop insurance indemnities minus producer-paid premiums. The Economic Research Service accounted for federal crop
insurance indemnities as farm-related income and accounted for producer-paid premiums as expenses.
697According to USDA’s Economic Research Service, net farm income reﬂects income after expenses from production in
the current year and is calculated by subtracting farm expenses from gross farm income. Gross farm income reﬂects the
total value of agricultural output plus government farm program payments.
Page 428
GAO-21-387

Contribution of Federal Direct Payments and Net Crop Insurance Payments to Net Farm Income, 2008–2021,
Adjusted for Inﬂation, as of February 5, 2021
Notes: Dollar amounts are adjusted for inﬂation using the chain-type Gross Domestic Product deﬂator, base year=2021,
according to the U.S. Department of Agriculture’s (USDA) Economic Research Service (ERS). Years are calendar years. The
years 2020 and 2021 include USDA forecasts for some categories as of February 5, 2021, according to ERS. ERS characterizes
“Consolidated Appropriations Act, 2021 – COVID-related payments,” Coronavirus Food Assistance Program, Paycheck Protection
Program, Market Facilitation Program, supplemental and ad hoc disaster, Farm Bill Title II – Conservation, Farm Bill Title I
– Commodities, and Other payments as direct government payments. The ERS Farm Income and Wealth Statistics started
reporting on federal crop insurance indemnities and premiums in 2008 and the agency accounts for crop insurance indemnities
as farm-related income and accounts for producer-paid premiums as expenses. We accounted for crop insurance as the net
amount a producer receives from the federal crop insurance program by subtracting producer-paid premium from indemnities.
Private insurance companies share underwriting risk with the federal government, however, from crop year 2008 to 2019 (the
latest crop year for which data is publicly available), the companies altogether had net underwriting gains in all years, except
for crop year 2012. The “Consolidated Appropriations Act, 2021–COVID-related payments” is the ERS projection of COVID-
related direct payments USDA will provide to farmers and ranchers from the Consolidated Appropriations Act, 2021. The
“Other” category includes Cotton Ginning Cost Share Program, Tobacco Transition Payments Program, Biomass Crop Assistance
Program, and miscellaneous programs.
Page 429
GAO-21-387

Agency Comments
We provided a draft of this enclosure to USDA and the Oﬃce of Management and Budget
for review and comment. USDA’s Oﬃce of the Secretary, Oﬃce of the Chief Economist, Farm
Production and Conservation Business Center, Farm Service Agency, and Economic Research
Service provided technical comments that we have incorporated into this enclosure, as
appropriate. Comments from the Oﬃce of the Secretary, Farm Production and Conservation
Business Center, Farm Service Agency, and Economic Research Service largely focused on
providing context for our apportionments and ERS analysis. Comments from the Oﬃce of the
Chief Economist focused on providing additional context for the crop insurance portion of our
analysis. The Oﬃce of Management and Budget provided technical comments that we have
incorporated into this enclosure, as appropriate.
Methodology
To conduct this work, we reviewed USDA oﬃcials’ written responses to our questions; USDA
budgetary data as of February 1, 2021; and the USDA Economic Research Service’s (ERS) Farm
Income and Wealth Statistics as of February 5, 2021. USDA noted in its description of the Farm
Income and Wealth Statistics that the data include estimates that are subject to revision as new
data become available. ERS develops the Farm Income and Wealth Statistics from administrative
data, as well as the department’s Agricultural Census, Agricultural Resources Management Survey,
and other survey data. We found the data to be reliable for our purposes of describing federal
spending to assist farmers and the contribution of those payments to farm income.
For our ﬁgure on the contribution of federal direct payments and net crop insurance payments
to farm income, we analyzed ERS’s Farm Income and Wealth Statistics, as of February 5, 2021.
ERS characterizes the amounts in the following categories included in the ﬁgure as direct federal
government payments: “Consolidated Appropriations Act, 2021 – COVID-related payments,”
“Coronavirus Food Assistance Program,” “Paycheck Protection Program,” “Market Facilitation
Program,” “supplemental and ad hoc disaster,” “Farm Bill Title II – Conservation,” “Farm Bill Title I
– Commodities,” and “Other”. To create our ﬁgure, we created new categories using the data from
the ERS analysis. Speciﬁcally, we created three distinct categories—Coronavirus Food Assistance
Program, Paycheck Protection Program, and Consolidated Appropriations Act, 2021 – COVID-
related payments—from ERS’s “supplemental and ad hoc disaster” category. We created the “Farm
Bill Title I – Commodities” category by combining the eleven Farm Bill Title I program lines in the
ERS data. We also created the “Crop insurance net payments (indemnities minus producer-paid
premium)” category. We calculated the net payments to producers by subtracting producer-paid
premium from indemnities. ERS accounts for federal crop insurance indemnities as farm-related
income and accounts for producer-paid premiums as expenses. Private insurance companies
share underwriting risk with the federal government; however, from crop year 2008 to 2019 (the
latest year for which data are publicly available), the companies altogether had net underwriting
gains in all years, except for in crop year 2012.
Contact information: Steve D. Morris, (202) 512-3841, morriss@gao.gov
Page 430
GAO-21-387

Agriculture Spending on Food Purchases
According to the U.S. Department of Agriculture, contractors—a key component of the Farmers
to Families Food Box Program—delivered 5.3 million food boxes in the ﬁrst 30 days (January 19
through February 18, 2021) of the ﬁfth round of the program. Across all ﬁve rounds of the program
(or since May 15, 2020), contractors delivered 138 million food boxes across the country, spending
$4 billion of the almost $5 billion obligated.
Entities involved: U.S. Department of Agriculture, including its Agricultural Marketing Service and
Oﬃce of the Secretary
Key Considerations and Future GAO Work
We continue to examine the U.S. Department of Agriculture’s (USDA) spending and oversight of
the Farmers to Families Food Box Program (Food Box Program).
In our September 2020 report identifying opportunities for USDA to identify successes and
challenges, we recommended that USDA evaluate the Food Box Program after the third round of
funding. USDA did not evaluate the program after the third round.
Background
As part of its response to the COVID-19 pandemic, USDA established the Food Box Program. Since
May 2020, through local, regional, and national contractors, USDA has purchased fresh fruits and
vegetables and meat and dairy products for distribution to food banks, community and faith-
based organizations, and other nonproﬁts that serve persons in need.
In the ﬁgure below we describe the funding amounts, obligations, and expenditures for the ﬁve
rounds of the Food Box Program.
Page 431
GAO-21-387

Funding Amounts, Obligations and Purchases (Expenditures) for the Farmers to Families Food Box Program, as
of January 31, 2021
Notes: According to USDA, the agency determines expenditures (or purchases) by the payments it makes on invoices it receives
from contractors. As such, expenditures (or purchases) can be lower than obligations because of the time it takes for USDA to
receive and process invoices.
aFamilies First Coronavirus Response Act, Pub. L. No. 116-127, div. A, tit. I, §1101(g) and (i), 134 Stat. 178, 180 (2020)
bThe CARES Act, Pub. L. No. 116-136, div. B, tit. I, 134 Stat. 281, 505 (2020)
cConsolidated Appropriations Act, 2021, Pub. L. No. 116-260, 134 Stat. 1182, 2105 (2020)
Overview of Key Issues
USDA continues to spend funds on food purchases through its Food Box Program. As the ﬁgure
above shows, USDA had obligated about $5 billion in awards to contractors (as of January
31, 2021).698 Contractors are a key component of the Food Box Program because they are
responsible for packaging food into boxes and delivering those boxes to recipients (food banks,
community and faith-based organizations, and other non-proﬁts serving persons in need). Below
we describe what the available USDA data say about contractors’ participation, awards, costs to
the government, and delivery.
698For more information on obligations related to the Food Box Program, see the Federal Contracts and Agreements for
COVID-19 enclosure .
Page 432
GAO-21-387

Contractor participation. As of February 2, 2021, 243 contractors had participated in the Food
Box Program’s ﬁve rounds, according to our analysis of program data.699 The ﬁgure below shows
the contractors participating across all ﬁve rounds.
Contractors Participating in the Farmers to Families Food Box Program across the Rounds, as of February 2, 2021
Contract awards. According to our analysis, as of February 2, 2021, USDA had awarded more
than 50 percent of the Food Box Program’s total obligations to 21 contractors. These contractors
collectively delivered boxes in all 50 states, Puerto Rico, and the U.S. Virgin Islands. Across the
ﬁve rounds, the largest award amount to a contractor was $278 million and the smallest was
$7,700.700 The average contract award increased in rounds 2 through 5 relative to round 1, as
shown below.
699The data we received from USDA and analyzed include one contractor to which USDA did not intend to award a
contract to deliver food boxes, but mistakenly did so due to the contractor being miscoded in USDA’s internal tracking
mechanism for the program. According to USDA oﬃcials, the contractor delivered some food boxes before USDA
recognized the mistake and terminated the contract for convenience of the government. The number of food boxes this
vendor delivered does not appear in the data.
700To calculate the total award amount we summed the contract awards, by contractor, across the rounds in which that
contractor participated. For example, the largest contract was the total award amount across the ﬁrst three rounds of
the program because the contractor only participated in the ﬁrst three rounds.
Page 433
GAO-21-387

Average Contract Award per Contractor for the Farmers to Families Food Box Program, by Round, as of February
2, 2021
Round 1
(May 15 – June 30,
2020)
Round 2
(July 1 – Sept. 18,
2020)
Round 3
(Sept. 22 – Oct. 31,
2020)
Round 4
(Nov. 1 – Dec. 31,
2020)
Round 5
(Jan. 19 – Apr. 30,
2021)
Average award
amount per
contractor
$5.6 m
$9.5 m
$16.9 m
$15.7 m
$9.8 m
Source: GAO analysis of U.S. Department of Agriculture data. | GAO-21-387
Cost of individual food boxes. USDA purchased ﬁve diﬀerent types of food boxes for delivery to
recipient organizations:
• fresh fruit and vegetables,
• milk,
• dairy,
• precooked meat, and
• combination boxes (which include a mix of fruit and vegetables, milk, dairy, and precooked
meat, eggs, or egg products).
The costs for individual food boxes varied widely among contractors, according to our analysis. For
example, in rounds 1 and 2 boxes of milk varied from $1.35 to $35.05, fresh fruit and vegetables
from $9.70 to $580.00, and precooked meat from $17.65 to $180.00.701 Beginning in round 3,
USDA issued consistent requirements for food boxes.702 Based on our analysis of the data for
rounds 3 through 5, the range in costs for individual food boxes was not as wide compared to
rounds 1 and 2. Speciﬁcally, the range in costs (i.e., the diﬀerence between the maximum and
minimum costs) for combination food boxes in rounds 1 and 2 was $139.70, but the range in
rounds 3 through 5 were between $32.34 and $77.21. According to USDA oﬃcials, the diﬀerences
in costs reﬂect the diﬀerences in what suppliers charge based on box content and size (weight),
delivery locations, and other factors. For example, these oﬃcials noted in a written response that
701The maximum food box cost of $580.00 applied to 31 of 9,601 food boxes delivered by one contractor across rounds
1 and 2 (for a total of $17,980), according to our analysis. According to USDA documentation, each of these 31 food
boxes weighed 570 pounds. A USDA oﬃcial clariﬁed that each of these food boxes were containers with 570 pounds of
apples.
702In its solicitations for rounds 1 and 2, USDA provided examples of products permitted in the food boxes, but did
not require speciﬁc contents. Starting in round 3, USDA indicated that it would purchase only combination boxes that
weighed between 30 and 40 pounds and contained: (1) 10-12 pounds of fresh fruit and vegetables, including 2-4 pounds
of root vegetables (e.g., potatoes, yams, carrots), 2-4 pounds of fruits with longer storage life (e.g., citrus, apples, and
melons), and 1 or 2 locally grown fruit or vegetable items, as available; (2) 5-6 pounds at least two dairy items, such as
cheese, butter, and sour cream; (3) 5-6 pounds of at least two pre-cooked meat items but not more than 1 pound of
lunch meat; and (4) at least 10 pounds of meat and dairy combined.
Page 434
GAO-21-387

in rounds one and two, the cost of the food boxes was among other factors that USDA used in
awarding contracts. However, according to USDA, beginning in round 3, the cost of the food boxes
delivered to a particular state was the primary factor in awarding contracts. For example, USDA
oﬃcials said that some states, such as Alaska, required higher transportation costs, which were
included in the cost per food box. The table below shows the range in cost to the government for
the combination food box, which contractors provided in all ﬁve rounds of the program.
Page 435
GAO-21-387

Range in Cost for Combination Food Boxes for the Farmers to Families Food Box Program, by Round, as of
February 2, 2021
Round 1
(May 15 – June 30,
2020)
(In dollars)
Round 2
(July 1 – Sept. 18,
2020)
(In dollars)
Round 3
(Sept. 22 – Oct. 31,
2020)
(In dollars)
Round 4
(Nov. 1 – Dec. 31,
2020)
(In dollars)
Round 5
(Jan. 19 – Apr. 30,
2021)
(In dollars)
Combination Food Boxes
Max.
150.00
150.00
99.00
64.95
105.00
Min.
10.30
10.30
34.95
32.61
27.79
Mean
45.85
47.44
47.38
40.30
34.48
Median
39.20
39.00
46.44
38.96
31.85
Source: GAO analysis of U.S. Department of Agriculture data. | GAO-21-387
Note: According to USDA, the solicitation for round 3 of the program indicated a preference for combination boxes over
individual box types. As noted above, starting with round 3, USDA provided more speciﬁcations for the contents of combination
boxes. Prior to that, for rounds 1 and 2 there was less speciﬁcity but there had to be a dairy product, precooked meat, milk, and
fruit and vegetables in the box.
Food delivery. According to USDA, as of February 18, 2021, contractors delivered about 138
million food boxes across the country across all ﬁve rounds of the program (or since May 15,
2020). In the ﬁrst 30 days (January 19 through February 18, 2021) of the ﬁfth round of the program
contractors delivered 5.3 million food boxes.
The number of boxes delivered refers to those received and accepted by recipients and for which
contractors will be paid by the government, according to USDA. USDA awards contracts based
on the maximum number of boxes that the contractors indicated they could deliver during the
contract’s performance period. The available data provide information on the delivery rate for the
ﬁrst four rounds of the program. The delivery rate is the percentage of boxes contractors delivered
out of the maximum amount allowed by their contract award.
As of February 2, 2021, contractors participating in rounds 1 through 4 delivered 79 percent of
the food boxes allowed by their contract with USDA. We found that deliveries improved over time.
For rounds 1 and 2, contractors delivered about 75 percent of boxes allowed by their contracts as
compared to about 96 percent of boxes in rounds 3 and 4. As of February 2, deliveries in round 5
had not yet been completed.
Agency Comments
We provided a draft of this enclosure to USDA and the Oﬃce of Management and Budget for
review and comment. USDA provided technical comments that we have incorporated into this
enclosure, as appropriate. The Oﬃce of Management and Budget did not have any comments
related to this enclosure.
Page 436
GAO-21-387

Methodology
To conduct this work, we analyzed the most recent USDA data as of February 2, 2021; reviewed
applicable federal laws, agency reports, and other documents; and interviewed USDA oﬃcials. We
reviewed data on this program by electronically testing them for missing elements, errors, and
outliers; reviewing related documentation; and interviewing USDA oﬃcials about their data system
as it relates to data quality. We determined the data were suﬃciently reliable for the purposes of
describing contractors participating in the program, as well as their award and food box delivery
data.
Contact information: Steve D. Morris, (202) 512-3841, morriss@gao.gov
Related GAO Product
Agriculture Spending: Opportunities Exist for USDA to Identify Successes and Challenges of the Farmers
to Families Food Box Program to Inform Future Eﬀorts. GAO-20-711R. Washington, D.C.: September
16, 2020.
Page 437
GAO-21-387

Single Audits
Auditors face challenges obtaining timely and useful guidance for performing single audits, a
type of audit which could help identify and correct deﬁciencies to help ensure award recipients’
appropriate use of federal funds, including billions of dollars provided by COVID-19 relief laws, and
reduce the likelihood of federal improper payments.
Entity involved: Oﬃce of Management and Budget
Recommendation for Executive Action
The Director of the Oﬃce of Management and Budget should work in consultation with federal
agencies and the audit community (e.g., agency Oﬃces of Inspector General; National Association
of State Auditors, Comptrollers, and Treasurers; and American Institute of Certiﬁed Public
Accountants), to the extent practicable, to incorporate appropriate measures in the Oﬃce of
Management and Budget’s process for preparing single audit guidance, including the annual
Single Audit Compliance Supplement, to better ensure that such guidance is issued in a timely
manner and is responsive to users’ input and needs.
The Oﬃce of Management and Budget neither agreed nor disagreed with our recommendation.
Key Considerations and Future GAO Work
In September 2020, we reported on the Oﬃce of Management and Budget’s (OMB) eﬀorts to
issue an addendum to its annual Single Audit Compliance Supplement (Compliance Supplement)
containing needed guidance speciﬁcally related to COVID-19 relief funds. As stated in our prior
report, the addendum could help ensure the timeliness and eﬃciency of single audits conducted
for recipients who received COVID-19 relief funds from programs such as the Coronavirus Relief
Fund. We recommended that OMB issue the addendum as soon as possible, as many single audit
eﬀorts were underway.
OMB issued the addendum in December 2020. However, the addendum did not address some
of the concerns raised by auditors who use the guidance to conduct single audits.703 Timely and
useful single audit guidance is needed to help ensure award recipients’ appropriate use of federal
funds and reduce the likelihood of federal improper payments.
We plan to continue to monitor OMB’s process for issuing single audit guidance, in consultation
with agencies and the audit community, and stay abreast of key issues and concerns experienced
by the users of such guidance concerning its usefulness and timeliness.
703Auditors raised concerns that the addendum lacked objective and measurable criteria for auditing certain programs.
Page 438
GAO-21-387

Background
Through provisions enacted in the COVID-19 relief laws, the federal government has provided
billions of dollars in federal funding to state and local governments, U.S. territory and tribal
governments, and nonproﬁt organizations in such areas as health care and higher education.
The Single Audit Act requires non-federal entities that receive federal awards to undergo a
single audit of those awards annually (unless a speciﬁc exception applies), when their federal
award expenditures meet a certain dollar threshold in a ﬁscal year.704 Single audits help identify
deﬁciencies in the award recipient’s compliance with applicable provisions of laws, regulations,
contracts, or grant agreements and in its ﬁnancial management and internal control systems.
Correcting such deﬁciencies can help ensure the appropriate use of federal funds and reduce the
likelihood of federal improper payments.
The Single Audit Act authorizes the Director of OMB to develop government-wide guidelines and
policy on performing audits to comply with the act.705 As part of this role, each year OMB, after
consultation with federal agencies, issues a Compliance Supplement, a tool designed to help
consolidate applicable legal requirements for numerous programs into one central place. Without
the Compliance Supplement, auditors would need to research compliance requirements per
program in numerous statutes and regulations. Auditors rely on the Compliance Supplement to
understand a federal program’s objectives, procedures, and compliance requirements. In turn, this
review helps auditors design their single audit objectives and audit procedures for determining
award recipients’ compliance with applicable provisions of laws, regulations, contracts, or grant
agreements.706
Overview of Key Issues
As noted in our September 2020 report, OMB’s 2020 Compliance Supplement, issued in August
2020, speciﬁed that OMB was still working with federal agencies to identify the need for additional
guidance for auditing new COVID-19 relief funded programs and existing programs with
compliance requirement changes. Recognizing that many audits were already underway, we
recommended that OMB issue the addendum to its 2020 Compliance Supplement containing
this additional audit guidance as soon as possible. The American Institute of Certiﬁed Public
Accountants (AICPA) also issued a letter to OMB in September 2020 expressing its concern that
some auditors were waiting for OMB’s addendum to be issued in order to begin testing the new
704The Single Audit Act is codiﬁed, as amended, at 31 U.S.C. §§ 7501-06, and implementing OMB guidance is reprinted
in 2 C.F.R. part 200. Non-federal entities (states, U.S. territory and tribal governments, local governments, or nonproﬁt
organizations) that expend $750,000 or more in federal awards in a ﬁscal year are required to undergo a single audit,
which is an audit of an entity’s ﬁnancial statements and federal awards, or a program-speciﬁc audit, for the ﬁscal year.
31 U.S.C. § 7502; 2 C.F.R. § 200.501.
705To help administer the new COVID-19 relief funding, many federal awarding agencies also issued new guidance to
award recipients on how those funds should be reported and spent.
706When there have been changes in the compliance requirements and those changes are not reﬂected in the annual
Compliance Supplement, the auditor must determine the current compliance requirements and modify the audit
procedures accordingly. 2 C.F.R. § 200.514(d)(3).
Page 439
GAO-21-387

COVID-19-related programs and other existing programs that were expected to be included. OMB
subsequently issued the addendum in December 2020.707
In developing this Compliance Supplement and addendum, OMB consulted with federal agencies
to identify the need for guidance and compliance requirements for auditing new and complex
COVID-19-related programs, as well as existing programs, to address challenges across the federal
government wrought by the COVID-19 pandemic. Speciﬁcally, OMB stated that it provides general
guidelines to agencies on areas of focus for program guidance and veriﬁes the formatting used
by agencies.708 OMB further explained that agencies are responsible for determining oversight
requirements for the programs they administer and for selecting the areas subject to audit in
the Compliance Supplement. OMB did not indicate whether its process includes established time
frames for providing its general guidelines to agencies or for agencies to provide Compliance
Supplement updates upon enactment of annual appropriations, supplemental appropriations, if
any, and other newly enacted provisions of law for eﬀective monitoring of federal funds.
The lag between the distribution of COVID-19 relief funds to recipients and OMB’s issuance of
single audit guidance contributed to delays in auditors conducting single audits and reporting
the results. These audits were also delayed because of deadline extensions for 2020 single audit
report submissions.709 While these deadline extensions might have provided helpful ﬂexibilities
to auditors and award recipients, delays in issuing guidance and completing audits could impact
award recipients’ development of corrective action plans, management decisions, and resolution
of ﬁndings identiﬁed during the audits.
OMB is currently working with federal agencies to identify compliance requirements for inclusion
in the 2021 Compliance Supplement, including compliance requirements for new and existing
programs that received funding under recent COVID-19 relief laws, such as the Consolidated
Appropriations Act, 2021, enacted in December 2020.710 This includes large COVID-19 relief
programs; for example, the Provider Relief Fund (see our Relief for Health Care Providers
enclosure in this report, programs susceptible to signiﬁcant improper payments (see our Medicaid
Enrollment, Spending, and Flexibilities enclosure in this report , and programs for meeting
immediate community needs during the pandemic (see our Community Services Block Grant
enclosure in this report. The American Rescue Plan Act of 2021 was enacted on March 11, 2021,
707OMB, in consultation with federal agencies, annually issues an updated Single Audit Compliance Supplement. The
Compliance Supplement provides guidance for auditors that conduct single audits and identiﬁes important compliance
requirements. Issuing a Compliance Supplement addendum, however, is not typical.
708 General guidelines may be related to Cross Agency Priority Goals or the President’s Management Agenda.
709The Addendum directs federal awarding agencies, in their capacity as cognizant or oversight agencies for audit,
to provide audit submission extensions of up to 3 months for certain award recipients with original 2020 single audit
reporting package due dates of October 1, 2020, through June 30, 2021. In earlier single audit guidance, OMB had
directed such federal agencies to provide audit reporting package submission extensions of up to 6 months for award
recipients with original reporting due dates of March 30, 2020, through June 30, 2020, and up to 3 months for award
recipients with original reporting due dates of July 31, 2020, through September 30, 2020. See OMB M-20-26, Extension of
Administrative Relief for Recipients and Applicants of Federal Financial Assistance Directly Impacted by the Novel Coronavirus
(COVID-19) Due to Loss of Operations (June 18, 2020).
710Consolidated Appropriations Act, 2021, Pub. L. No. 116-260, 134 Stat. 1182 (2020).
Page 440
GAO-21-387

and given the timing of such, we did not have an opportunity to determine OMB’s plans for
providing guidance on the funding provided as a result of this recent act.711
Based on a single audit working group discussion with audit community stakeholders—state
auditors; representatives from federal agency Oﬃces of Inspector General (OIG); the AICPA; and
the National Association of State Auditors, Comptrollers and Treasurers (NASACT);712—auditors
who conduct single audits for entities with June 30 year-ends, have expressed a need to have
the Compliance Supplement by no later than April of each year to eﬀectively plan their audits
and conduct interim testing.713 However, for the past 3 years, OMB issued its annual Compliance
Supplements later in the year. Speciﬁcally, the 2018-2020 annual Compliance Supplements were
not issued until May 2018, August 2019, and August 2020, respectively, and the 2020 Addendum
containing additional guidance related to COVID-19 relief funded programs and other existing
programs was not issued until December 2020.
OMB did not provide an estimated timeline for issuing the 2021 Compliance Supplement, but
stated that it believes there is currently an appropriate balance between the timeliness of issuing
the annual Compliance Supplement and the consideration given to the inputs or comments by
the stakeholders. Although OMB has an established process for issuing guidance, it is unclear
whether OMB has a target timeframe and representatives from the audit community continue
to express a need to have the Compliance Supplement earlier. In September 2010, GAO made
a recommendation for OMB to issue the Compliance Supplement by no later than March 31
each year. Our 2010 recommendation to OMB was not implemented and we are making a
similar recommendation in this enclosure to address the timeliness concerns noted by the audit
community.
Our Standards for Internal Control in the Federal Government emphasize the need for providing
timely information, such as the guidance in the Compliance Supplement, for eﬀective monitoring.
These standards also state that management should identify, analyze, and respond to signiﬁcant
changes, such as the establishment of new COVID-19-related programs, which would in turn
require changes to the Compliance Supplement to specify compliance requirements. Management
can anticipate and plan for signiﬁcant changes by using a forward-looking process wherein it
identiﬁes on a timely basis, changes that have already occurred or are expected to occur.
This forward-looking process would include established timeframes to capture annual changes
needed to the Compliance Supplement based on annual appropriations, supplemental
appropriations, if any, and other newly enacted provisions of law for eﬀective monitoring of
federal funds. A process for timely preparing and providing the guidance contained in OMB’s
annual Compliance Supplements to auditors is essential to help ensure that single audits can
711American Rescue Plan Act of 2021, Pub. L. No. 117-2, 135 Stat. 4.
712The single audit working group was an initiative convened by the Comptroller General to determine the extent of
issues, if any, related to single audits and to identify areas, if any, where the Compliance Supplement could be enhanced.
The working group consisted of representatives from the AIPCA and NASACT, as well as state auditors from nine
states and OIGs from four agencies as identiﬁed by the NASACT and Council of the Inspectors General on Integrity and
Eﬃciency, respectively, and GAO.
713Entities may also have ﬁscal year-ends at other times of the year, such as of March 31, September 30, or December
31.
Page 441
GAO-21-387

be performed timely and enhance the federal government’s ability to help safeguard billions of
dollars in federal funds, including those provided under COVID-19 relief laws. As we previously
reported, delays in issuing guidance could adversely aﬀect auditors and the results and timing of
their work, and may lead to inconsistent reporting.
In addition to providing timely guidance, it is also essential that OMB establish and maintain a
clear process that provides adequate time to work with stakeholders—including federal agencies
and the audit community—to determine needed changes to more fully address their input
and concerns, which in turn could help ensure the quality of the guidance. This is especially
critical going forward given the magnitude of COVID-19 relief funding. OMB stated that it solicits
comments from members of the audit community, and makes revisions as appropriate, prior to
issuing its ﬁnal annual Compliance Supplement. However, it is unclear to members of the audit
community what OMB’s decision-making process is for resolving concerns raised during the
comment period.
According to the AICPA, there are ongoing enhancements needed to OMB’s process for annually
updating the Compliance Supplement. These include a need for the Compliance Supplement
to focus on areas of highest risk and ensure audit procedures are capable of consistent
measurement against objective criteria. The AICPA has also suggested that greater transparency
around OMB’s decision-making process for changes to the Compliance Supplement and enhanced
collaboration among audit community stakeholders would be helpful.
The concerns raised by the AICPA are similar to those concerns identiﬁed in early ﬁscal year
2020 (over a year ago) by the single audit working group referenced earlier. Based on a
survey conducted with members of the single audit working group, there is a need for the
audit community to have a greater role in the updates/revisions to ensure that single audit
requirements for auditors include applicable and objective criteria. We reached out to OMB to
provide an overview of the working group’s ﬁndings and OMB stated that it planned to oﬀer a
listening session in April 2020. One of OMB’s stated goals of the listening session was to gain
insights from the audit community of key challenges associated with single audits. However, OMB
subsequently stated that the listening session was delayed due to the COVID-19 pandemic and
has not yet been scheduled, as of March 10, 2021. OMB stated that it welcomes an overview of the
working group’s ﬁndings and we will coordinate with OMB on scheduling a meeting.
In addition, OMB stated that in August 2020 it held two meetings—one with the AICPA and
NASACT (on August 17, 2020) and another with the OIGs (on August 18, 2020)—to discuss the
single audit challenges and the merit, value, and challenge of focusing on federal program
performance review. Given the timing of these meetings, it is unlikely that concerns raised during
these meetings were addressed in the 2020 Compliance Supplement as it was issued on August
14, 2020.
In the August 2020 Compliance Supplement, OMB stated that it would work with federal awarding
agencies to identify the COVID-19 funding programs and the necessity for these programs to be
added in an addendum to that Supplement. However, representatives from the AICPA and NASACT
stated in February 2021 that the addendum issued in December 2020 did not address some of the
concerns raised by auditors who use the guidance to conduct single audits.
Page 442
GAO-21-387

GAO’s Standards for Internal Control in the Federal Government state that management should
use quality information to achieve the entity’s objectives. This includes designing a process that
uses objectives and related risks to identify the information requirements needed to achieve
objectives and address the risks. Information requirements should consider the expectations
of both internal and external users. A clear and transparent process for considering and
incorporating, as appropriate, input received on the Compliance Supplement is an important
aspect of OMB’s eﬀorts to help ensure it provides useful and timely guidance.
Agency Comments and Our Evaluation
We provided OMB with a draft of this enclosure. OMB provided technical comments, which we
incorporated as appropriate. In its technical comments, OMB stated that it has a formal process
in place for preparing the annual Compliance Supplement, which includes a comprehensive
vetting process and opportunities for the audit community stakeholders to review the draft
and submit comments. OMB stated that it reviews and considers these comments and makes
revisions as appropriate during the preparation of the ﬁnal document. Additionally, OMB stated
that stakeholders are invited to provide comments during the annual notice of availability of the
Compliance Supplement published in the Federal Register and that any comments received are
reviewed and considered as OMB develops the subsequent year’s Compliance Supplement. While
we recognize OMB has a formal process in place, the need for earlier issuance has been a long-
standing issue and key stakeholders from the audit community continue to express concerns with
the timeliness and quality of the Compliance Supplement. Therefore, we continue to believe that
OMB should implement appropriate measures to better ensure that the Compliance Supplement
is responsive to users’ input and needs.
Methodology
To conduct this work, we reviewed federal laws and regulations, as well as single audit guidance
issued by OMB. We also contacted oﬃcials at OMB to obtain information about its processes
for issuing single audit guidance and met with representatives from the audit community
(i.e., state auditors, oﬃcials from OIGs, and representatives from the AICPA and NASACT) to
obtain information on their experiences with using OMB’s single audit guidance in the course
of their audits. We reviewed the Standards for Internal Control in the Federal Government to
determine relevant federal internal control standards for responding to change and issuing quality
information in a timely manner.
Contact information: Beryl Davis, (202) 512-2623, DavisBH@gao.gov
Related GAO Products
COVID-19: Federal Eﬀorts Could Be Strengthened by Timely and Consorted Actions. GAO-20-701.
Washington, D.C.: September 21, 2020.
Page 443
GAO-21-387

Standards for Internal Control in the Federal Government. GAO-14-704G. Washington, D.C.:
September 10, 2014.
Recovery Act: Opportunities to Improve Management and Strengthen Accountability over States’ and
Localities’ Uses of Funds. GAO-10-999. Washington, D.C.: September 20, 2010.
Page 444
GAO-21-387

Federal Food Safety Inspections and Inspectors’ Exposure to
COVID-19
The U.S. Department of Agriculture is maintaining staﬃng and federal inspections at meat and
poultry plants.
Entity involved: Food Safety and Inspection Service, within the U.S. Department of Agriculture
Key Considerations and Future GAO Work
Our work on the U.S. Department of Agriculture’s (USDA) implementation and oversight of a range
of CARES Act funds,714 including on any implementation challenges, is ongoing. We will continue to
examine the department’s capacity to ensure the continuity of food safety inspections at meat and
poultry plants and other establishments.
Background
COVID-19 has caused disruptions in the U.S. food supply chain, from the farms where raw
agricultural commodities are produced, to the food-processing and distribution network that
enables these commodities to be used by consumers.715 The 7,799 inspectors and other frontline
staﬀ from the USDA’s Food Safety and Inspection Service (FSIS) work in 6,512 federally inspected
meat and poultry plants and other establishments.716 These inspectors help ensure the safety
and wholesomeness of the meat and poultry that enter interstate commerce, and some have
been exposed to COVID-19. According to April 2020 interim guidance from the Centers for Disease
Control and Prevention and the Occupational Safety and Health Administration, working in
close conditions may contribute to exposure to COVID-19. In response to the executive order on
Protecting Worker Health and Safety, on January 29, 2021, the Occupational Safety and Health
Administration published COVID-19 worker safety guidance, including recommendations for
workplace COVID-19 prevention programs and policies.717
714Pub. L. No. 116-136, div. B, tit. I, 134 Stat. 281, 506 (2020).
715COVID-19 aﬀected consumer prices for food. In May 2020, the U.S. Bureau of Labor Statistics reported that April 2020
saw the sharpest increase in grocery store prices since 1974.
716FSIS also has responsibility for inspecting meat and poultry products at U.S. ports and conducting audits of foreign
food safety inspection systems overseas. The Food and Drug Administration (FDA) covers food safety activities for other
types of food production. FDA did not receive CARES Act funds for food safety-related activities. We plan to examine
FDA’s response to COVID-19 with respect to food safety inspections and related activities.
717Exec. Order No. 13999, 86 Fed. Reg. 7211 (Jan. 26, 2021). U.S. Department of Labor, Occupational Safety and Health
Administration. Protecting Workers: Guidance on Mitigating and Preventing the Spread of COVID-19 in the Workplace,
January 29, 2021. https://www.osha.gov/coronavirus/safework (last accessed on Feb. 12, 2021). This report does
not cover worker safety. In January 2021, we reported on the Department of Labor Occupational Safety and Health
Administration’s eﬀorts to protect worker safety and health and plan to conduct future work.
Page 445
GAO-21-387

As of January 31, 2021, USDA had obligated $18 million and spent $16 million of the $33 million
in CARES Act funds that Congress appropriated to FSIS in March 2020 to prevent, prepare for, and
respond to COVID-19 with regard to food safety inspections.718
Overview of Key Issues
FSIS has spent over $6 million in CARES Act funds to protect inspection personnel and other
staﬀ. To mitigate risks associated with COVID-19, FSIS directs inspection personnel to wear face
coverings or masks in conjunction with face shields—supplies provided by the agency. As of
January 31, 2021, of the total $16 million USDA spent, $6 million was for FSIS employees’ personal
protective equipment, including for supplies to combat heat stress, according to oﬃcials.719
In November 2020, we reported that for the remaining funds USDA spent CARES Act funds to
maintain staﬃng of FSIS inspectors including to cover costs for additional hours worked by
part-time inspectors, bring in inspectors from other USDA oﬃces, and pay for nonreimbursable
overtime. USDA oﬃcials told us that the agency will also continue to use CARES Act funds to cover
the expenses for inspectors’ equipment and funds may be needed to pay for those employees not
working due to illness––that is, to pay for additional part-time inspectors; inspectors from other
USDA oﬃces and associated travel; and nonreimbursable overtime, as needed.720 USDA oﬃcials
said that as of January 31, 2021, there were no establishments that had to close because of a lack
of available FSIS inspectors.
USDA has tracked FSIS inspectors’ and other staﬀ’s COVID-19-related absences and followed
agency protocols for contact tracing. According to USDA documentation, as of January 29,
2021, 1,405 inspectors and staﬀ had reported a COVID-19 diagnosis conﬁrmed by a test or
medical professional, since the ﬁrst reported case in March 2020. Of these employees, 1,295
had returned to work and 31 were self-quarantining.721 In addition to the 1,405 diagnoses, there
were 12 employee deaths due to COVID-19. FSIS employees deceased from COVID-19 are not
included in the cumulative count of employees who had a COVID-19 diagnosis, according to USDA
documentation. Although FSIS does not have a speciﬁc requirement for employees to report
COVID-19 infections and relies on staﬀ to self-report, FSIS employees are required to report an
absence from work. According to USDA’s FSIS Human Pandemic Operations Plan, under the
718Pub. L. No. 116-136, 134 Stat. at 506.
719According to USDA oﬃcials, this includes personal protective equipment purchased for in-plant personnel in the
ﬁeld and personal protective equipment for FSIS employees based in laboratories and oﬃce locations. The additional
protective gear, such as face shields, that FSIS inspection personnel are wearing to protect against COVID-19 can trap
heat close to the body and may contribute to heat stress. To combat heat stress, the agency purchased electrolyte ﬂuids,
neck cooling scarves, cooling vests, cooling hat liners, evaporative cooling hard hat pads, evaporative cooling bandanas,
and cooling hat ties.
720According to a USDA FSIS oﬃcial, nonreimbursable overtime is paid when an inspector has already worked a full shift
and needs to work additional hours at another establishment that is not in an overtime status and subject to paying FSIS
an overtime fee.
721The total number of FSIS employees with a conﬁrmed diagnosis of COVID-19 does not equal the total number of
employees who have returned to work or self-quarantined because the status of some employees is not indicated in
USDA documentation provided to us. According to USDA documentation, the number of employees who had a COVID-19
diagnosis is cumulative and this cumulative number includes employees who have returned to work (i.e., recovered from
the disease). This number combines inspectors and staﬀ whose occupational exposures may vary.
Page 446
GAO-21-387

agency’s leave directive, FSIS employees are required to report to their supervisors if they will
be absent from duty and, in the event of a human pandemic, supervisors and managers should
initiate a follow-up for any unscheduled employee absence.722
Upon notiﬁcation of a positive COVID-19 test result from an employee, FSIS follows USDA protocols
for contact tracing, according to oﬃcials. This includes gathering pertinent information such as
illness onset, testing date and result, last time in building, and contact with employees at the
workplace. USDA uses the information to determine any necessary notiﬁcations to FSIS and meat
and poultry plant personnel, according to oﬃcials. For notiﬁcation of COVID-19 outbreaks at
plants, FSIS relies on meat and poultry plants to notify local FSIS supervisors at facilities. According
to oﬃcials, the agency does not have authority to require meat and poultry plants to make this
notiﬁcation, but exchange of information at the local level between FSIS and industry about
COVID-19 positive cases has been eﬀective.
FSIS has continued U.S. inspection activities throughout the COVID-19 pandemic. According
to USDA oﬃcials, during the COVID-19 pandemic, FSIS has maintained required inspection
services to ensure that establishments including meat and poultry plants can operate. In response
to the COVID-19 pandemic, FSIS reduced testing for pathogens in meat and poultry products
in the second quarter of ﬁscal year 2020, resumed normal testing by July 2020, and further
increased testing and analysis to meet ﬁscal year 2020 goals. According to oﬃcials, FSIS is
currently executing its ﬁscal year 2021 testing plan with no impact from the COVID-19 pandemic.
In addition, agency oﬃcials told us that a similar percentage of plants that the agency inspected
continued to meet the Salmonella performance standard—the maximum allowable number of
poultry product samples testing positive for the pathogen—from the second quarter of ﬁscal year
2020 through the ﬁrst quarter of ﬁscal year 2021.723
FSIS also has responsibility for inspecting meat and poultry products at U.S. ports and conducting
on-site audits of foreign food safety inspection systems. According to agency oﬃcials, FSIS
inspections of meat, poultry, catﬁsh, and processed egg products imported into the U.S. continued
throughout the pandemic at the same established rate and frequency as the previous year.
However, since FSIS is currently unable to schedule on-site veriﬁcation audits of foreign inspection
systems, according to oﬃcials, the agency has developed an approach to conduct remote audits
of foreign systems through electronic communication and information exchanges. This approach
is similar to the one taken by some trading partners for auditing the U.S. inspection system during
this time. It is in place as a temporary measure due to current limitations resulting from the
COVID-19 pandemic, and on-site veriﬁcation audits are expected to resume once conditions allow
for them, according to oﬃcials. The agency continues to monitor the situation and will evaluate
722See U.S. Department of Agriculture, Oﬃce of the Administrator, The Food Safety and Inspection Service Human
Pandemic Operations Plan, March 2020, U.S. Department of Agriculture, Food Safety and Inspection Service, Leave, FSIS
Directive 4630.2 (Washington, D.C.: Sept. 15, 2010).
723We have not independently veriﬁed whether a similar percentage of plants met the Salmonella standard during
this time period. In March 2018, we reported that FSIS developed standards limiting the amount of Salmonella and
Campylobacter—pathogens that can cause foodborne illness in humans—permitted in certain meat (beef and pork) and
poultry (chicken and turkey) products, such as ground beef, pork carcasses, and chicken breasts. However, the agency
had not developed standards for other products that are widely available, such as turkey breasts and pork chops. We
recommended that the agency document its process for deciding which products to consider for new standards.
Page 447
GAO-21-387

the feasibility of on-site audits as the situation evolves, including reviewing State Department
guidance on foreign travel.
Agency Comments
We provided a draft of this enclosure to USDA and the Oﬃce of Management and Budget
for review and comment. USDA and the Oﬃce of Management and Budget did not have any
comments related to this enclosure.
Methodology
To conduct this work, we reviewed the most recent USDA data on COVID-19 illnesses and
exposures among FSIS employees available as of January 29, 2021; the CARES Act; agency
policy and other guidance; USDA expenditure data including purchases of personal protective
equipment, as of January 31, 2021; and written responses to questions we emailed USDA oﬃcials
in the FSIS. We assessed the reliability of agency data by reviewing relevant USDA FSIS documents,
reviewing our prior use of the data sources, and reviewing written responses from the agency
about the data. We determined the data were suﬃciently reliable for estimating the number of
FSIS staﬀ that had become ill with COVID-19.
Contact information: Steve D. Morris, (202) 512-3841, morriss@gao.gov
Related GAO Product
Food Safety: USDA Should Take Further Action to Reduce Pathogens in Meat and Poultry Products.
GAO-18-272. Washington, D.C.: March 19, 2018.
Page 448
GAO-21-387

Appendix II: List of Ongoing GAO Work Related to COVID-19,
as of March 17, 2021
Repatriation Program COVID-19 Response
Oversight of Unemployment Insurance during COVID-19
Higher Education Aid in Response to COVID-19
Early Care and Education and the Coronavirus Pandemic Response
Agency Information Technology Preparedness in Response to Coronavirus Pandemic
Tracking Funds and Associated Activities Related to Federal Response to COVID-19
Diagnostic Testing
Worker Safety during COVID-19
Distance Learning Challenges for English Learners and Students with Disabilities
Business/Employer Tax Provisions
Nutrition Assistance during COVID-19
Agencies’ Readiness and Use of Telework for COVID-19 Response
Internal Revenue Service (IRS) Administration of Economic Impact Payments
Housing Finance System in the Pandemic
Military Health System COVID Response
COVID-19-Related Grant Flexibilities
Bureau of Prisons’ Emergency Preparedness and Response
Transportation Security Administration (TSA) Measures to Prevent COVID-19 at Checkpoints
COVID-19 in Nursing Homes
Biodefense Preparedness and Response
Federal Agencies’ Reentry
Agencies’ Human Capital Flexibilities in Response to Coronavirus Pandemic
Immigration Detention Facilities and Operations
Page 449
GAO-21-387

Department of Veterans Aﬀairs’ (VA) COVID-19 Procurement Response
Election Assistance Commission Guidance and Grants Oversight during the COVID-19 Pandemic
Eﬀects of COVID-19 on Dedicated Collections
School Meals during the Pandemic
Data and Modeling for COVID-19
VA’s Civilian Public Health Response to the COVID-19 Pandemic
CARES Act Housing Protections
Bureau of Indian Education Distance Education during COVID-19 Pandemic
Child Welfare Services during the COVID-19 Pandemic
Department of the Treasury and Department of the Interior’s COVID-19 Response to Tribes
Department of State’s Repatriation Eﬀorts
Small Business Administration’s Implementation of the Paycheck Protection Program
Indian Health Service Response to COVID-19
Vaccine Development
Nurse Corps Loan Repayment Program
Coast Guard COVID-19 Response Eﬀorts
Human Pandemic Preparedness Plan for Food Safety Inspections
CARES Act Assistance to Farmers
COVID-19 Impacts on Customs and Border Protection Operations
Medicaid Waivers and Flexibilities for COVID-19
Immigration Courts Response
Department of Defense Depot COVID-19 Impacts
Economic Injury Disaster Loans and Advances for COVID-19
Federal Air Marshal Service Response to COVID-19
Treasury Debt Management Response to COVID-19
Page 450
GAO-21-387

Services for Older Adults
Characteristics of Paycheck Protection Program Loans
Aviation Operations in a Pandemic Environment
CARES Act International Humanitarian Assistance
Federal Contributions to Remdesivir
U.S. Postal Service: Volume, Performance, and Financial Changes to Since the Onset of the
COVID-19 Pandemic
Behavioral Health Impacts
Unemployment Assistance for Contingent Workers
VA’s Preparedness for COVID-19
Operation Warp Speed
Department of Health and Human Services (HHS) Medicare Telehealth Waivers for COVID-19
Vaccine Distribution and Communication
VA Nursing Homes
Community Behavioral Health Demonstrations
VA COVID-19 Supplemental Funding
VA Access to Community Care
State and Local Fiscal Conditions & Federal Implications
Bureau of Prisons’ Response to COVID-19
Pandemic Learning Loss
Strategic National Stockpile Internal Controls
COVID-19 Contracting Flexibilities
Contractor Qualiﬁcations and Agency Lessons Learned
Impact on IRS Tax Enforcement and Revenue
Department of State and U.S. Agency for International Development Overseas Operations
Page 451
GAO-21-387

Farmer Food Purchases and Distribution
Department of Housing and Urban Development CARES Act Oversight
Internal Controls over Higher Education Emergency Relief Fund
Supply Chain and the Defense Production Act
Tax Policy Eﬀects on Households by Sex, Race, Ethnicity
HHS Hospital Capacity Data
COVID-19 Contractor Paid Leave Reimbursement Approaches
COVID-19 Paid Leave Enforcement
Research on Disease Transmission via Air Travel
K-12 Disconnected Students during the COVID-19 Pandemic
Tax Policy Eﬀects on Businesses by Sex and Race
TSA Process for Restricting International Air Travel
Defense-wide Working Capital Fund COVID-19 Eﬀects
HHS’s Public Health Situational Awareness Capability
Scientiﬁc Integrity at Selected HHS Agencies
Treasury Coronavirus Relief Fund
Contact Tracing App - Technology Assessment
CARES Act Title IV Federal Reserve Facilities II
Expanding the U.S. Personal Protective Equipment Industrial Base
Social Security Administration Service Delivery during COVID-19
Financial Regulatory Oversight
CARES Act Loans for Aviation and National Security Businesses
Global Health Security Eﬀorts
Health Insurance Loss
Nursing Home COVID-19 Outbreaks
Page 452
GAO-21-387

VA Community Living Centers and COVID-19 Data
Medicaid Telehealth during COVID-19
Strategic National Stockpile Contents and Management Review
HHS Public Relations Campaign
Election Administration during the COVID-19 Pandemic
Pandemic Foreclosure and Forbearance Protections
COVID-19 Vaccines
Aviation Contact Tracing
U.S. Customs and Border Protection Trade Facilitation during COVID-19
Freedom of Information Act Processing during COVID-19
Regulatory Flexibilities for COVID-19 Response
Regulatory Flexibilities Timeline
COVID-19 Disparities
Page 453
GAO-21-387

Appendix III: Status of Our Matters for Congressional
Consideration and Recommendations for Executive Action as
of March 2021
In our June 2020 CARES Act report, we made three matters for congressional consideration
and three recommendations for executive action. In our September 2020 CARES Act report, we
made 16 recommendations. In our November 2020 CARES Act report, we made one matter for
congressional consideration and 11 recommendations. Also, in November 2020, we issued a
report on COVID-19 vaccines and therapeutics, and made one recommendation. In our January
2021 CARES report we made 13 recommendations. Following are the recommendations, and their
status by department (see ﬁg. 8).
Figure 8: Status of Prior GAO Recommendations by Department or Agency
Below we list by department or agency our four prior matters for congressional consideration and
our 44 prior recommendations, and characterize their implementation status.
Page 454
GAO-21-387

Status of matters for congressional consideration and
recommendations made regarding the Department of Health and
Human Services (HHS)
Matter. To help ensure that federal funding is targeted and timely, we urge Congress to use our
Federal Medical Assistance Percentage formula for any future changes to the Federal Medical
Assistance Percentage during the current or any future economic downturn (June 2020 report).
Status: Open
Comments: Our past work has found that during economic downturns—when Medicaid
enrollment can increase and state economies weaken—the formula, which is based on each
state’s per capita income, does not reﬂect current state economic conditions. No congressional
action has been taken to date.
Recommendation. The Secretary of Health and Human Services in coordination with the
Administrator of the Federal Emergency Management Agency (FEMA)—who head agencies leading
the COVID-19 response through the Uniﬁed Coordination Group—should immediately document
roles and responsibilities for supply chain management functions transitioning to HHS, including
continued support from other federal partners, to ensure suﬃcient resources exist to sustain and
make the necessary progress in stabilizing the supply chain, and address emergent supply issues
for the duration of the COVID-19 pandemic (September 2020 report).
Status: Open
Comment: As of January 2021, HHS disagreed with our recommendation, noting, among
other things, the work that the department had done to manage the medical supply chain and
increase supply availability. We acknowledge those eﬀorts, but continue to maintain that our
recommendations are warranted.
Recommendation. The Secretary of Health and Human Services in coordination with the
Administrator of FEMA—who head agencies leading the COVID-19 response through the Uniﬁed
Coordination Group—should further develop and communicate to stakeholders plans outlining
speciﬁc actions the federal government will take to help mitigate remaining medical supply gaps
necessary to respond to the remainder of the pandemic, including through the use of Defense
Production Act authorities (September 2020 report).
Status: Open
Comment: As of January 2021, HHS disagreed with our recommendation, noting, among
other things, the work that the department had done to manage the medical supply chain and
increase supply availability. We acknowledge those eﬀorts, but continue to maintain that our
recommendations are warranted.
Recommendation. The Secretary of Health and Human Services—who heads one of the agencies
leading the COVID-19 response through the Uniﬁed Coordination Group—consistent with
their roles and responsibilities, should work with relevant federal, state, territorial, and tribal
Page 455
GAO-21-387

stakeholders to devise interim solutions, such as systems and guidance and dissemination of best
practices, to help states enhance their ability to track the status of supply requests and plan for
supply needs for the remainder of the COVID-19 pandemic response (September 2020 report).
Status: Open
Comment: As of January 2021, HHS disagreed with our recommendation, noting, among
other things, the work that the department had done to manage the medical supply chain and
increase supply availability. We acknowledge those eﬀorts, but continue to maintain that our
recommendations are warranted.
Recommendation. The Secretary of Health and Human Services, with support from the Secretary
of Defense, should establish a time frame for documenting and sharing a national plan for
distributing and administering a COVID-19 vaccine and, in developing such a plan, ensure that it is
consistent with best practices for project planning and scheduling, and outlines an approach for
how eﬀorts will be coordinated across federal agencies and nonfederal entities (September 2020
report).
Status: Open
Comment: HHS neither agreed nor disagreed with our recommendation. In November 2020, we
reported that HHS and the Department of Defense (DOD) had released initial planning documents
for the distribution and administration of potential COVID-19 vaccines, but also reported that
stakeholders indicated that they would like to see additional information as planning continued.
Since our November report, HHS and DOD have continued their eﬀorts related to vaccine
implementation. We will continue to monitor federal eﬀorts to determine whether the actions
taken address our recommendation.
Recommendation. Based on the imminent cybersecurity threats, the Secretary of Health and
Human Services should expedite the implementation of our prior recommendations regarding
cybersecurity weaknesses at its component agencies (September 2020 report).
Status: Open
Comment: HHS agreed with our recommendation and has reported actions the department is
taking to implement it, such as leveraging its monthly Chief Information Security Oﬃcer Council
meetings to discuss recommendations made across the HHS component agencies. Additionally,
the relevant component agencies—the Food and Drug Administration (FDA), Centers for Medicare
& Medicaid Services (CMS), and Centers for Disease Control and Prevention (CDC)—have
addressed additional cybersecurity weaknesses since we reported in January 2021. Speciﬁcally,
FDA, CMS, and CDC implemented an additional 17 of our cybersecurity recommendations,
bringing the total number of implemented recommendations to 421 of the total 434 we made
to these agencies. This reﬂects a 4-percent increase in corrective actions taken to bolster
cybersecurity at the component agencies.
Recommendation. The Secretary of Health and Human Services should develop and make
publicly available a comprehensive national COVID-19 testing strategy that incorporates all six
characteristics of an eﬀective national strategy. Such a strategy could build upon existing strategy
Page 456
GAO-21-387

documents that HHS has produced for the public and Congress to allow for a more coordinated
pandemic testing approach (January 2021 report).
Status: Open
Comment: HHS partially agreed with our recommendation. HHS agreed that the department
should take steps to more directly incorporate some of the elements of an eﬀective national
strategy, but expressed concern that producing such a strategy at this time could be overly
burdensome on the federal, state, and local entities that are responding to the pandemic, and
that a plan would be outdated by the time it was ﬁnalized or potentially rendered obsolete by
the rate of technological advancement. Additionally, HHS stated that, to be of value to the whole
of nation response to COVID-19, testing plans need to establish guidelines and use metrics that
are operationally relevant, which necessitates strategic ﬂexibility in testing plans to guide those
managing the response in the use of available resources to address local and state conditions
rather than a single static nationwide plan.
Recommendation. To improve the federal government’s response to COVID-19 and preparedness
for future pandemics, the Secretary of Health and Human Services should immediately establish
an expert committee or use an existing one to systematically review and inform the alignment of
ongoing data collection and reporting standards for key health indicators. This committee should
include a broad representation of knowledgeable health care professionals from the public and
private sectors, academia, and nonproﬁts (January 2021 report).
Status: Open
Comment: HHS partially agreed with our recommendation. HHS agreed that it should establish a
dedicated working group or other mechanism with a focus on addressing COVID-19 data collection
shortcomings. However, HHS said because of resource constraints and the ongoing response to
the pandemic, it could not commit to immediately doing so.
HHS CDC
Recommendation. As CDC implements its COVID-19 Response Health Equity Strategy, the
Director of CDC should determine whether having the authority to require states and jurisdictions
to report race and ethnicity information for COVID-19 cases, hospitalizations, and deaths is
necessary for ensuring more complete data and, if so, seek such authority from Congress
(September 2020 report).
Status: Open
Comment: CDC agreed with our recommendation. In response, in February 2021, CDC stated
that it is reviewing race and ethnicity data completeness across its core surveillance systems
and engaging stakeholders from across the agency and in state and local health departments
to improve the collection of race and ethnicity data. CDC noted that stakeholders include CDC
leadership, key taskforces from within CDC’s COVID-19 emergency response, and data and
surveillance experts in CDC and state health agencies. CDC reported that the information
derived from this review will be discussed with the CDC Director and used to assess potential
opportunities to enhance the collection of race and ethnicity data, including policy changes or
Page 457
GAO-21-387

seeking legislative authorities. We will continue to conduct work examining HHS, CDC, and other
component agencies’ ongoing work regarding indicators of COVID-19 and disparities that exist for
various populations.
Recommendation. As CDC implements its COVID-19 Response Health Equity Strategy, the
Director of CDC should involve key stakeholders to help ensure the complete and consistent
collection of demographic data (September 2020 report).
Status: Open
Comment: CDC agreed with our recommendation. In response, in February 2021, CDC stated
that it is reviewing the quality of demographic data, including the completeness of race and
ethnicity data, across its core surveillance systems and engaging stakeholders from across the
agency and in state and local health departments on the issue. CDC noted that stakeholders
include CDC leadership, key taskforces from within CDC’s COVID-19 emergency response, and
data and surveillance experts in CDC and state health agencies. CDC reported that the information
derived from this review will be discussed with the CDC Director and used to assess potential
opportunities to enhance the collection of race and ethnicity data, including seeking policy
changes or legislative authorities. CDC also stated that it is working with public health partners
to automate the generation and transmission to CDC of COVID-19 case reports that contain
demographic information, including race and ethnicity. According to CDC, as of January 12, 2021,
more than 6,500 facilities are sending COVID-19 electronic case reports to state and jurisdictional
health departments. We will continue to conduct work examining HHS, CDC, and other component
agencies’ ongoing work regarding indicators of COVID-19 and disparities that exist for various
populations.
Recommendation. As CDC implements its COVID-19 Response Health Equity Strategy, the
Director of CDC should take steps to help ensure CDC’s ability to comprehensively assess the long-
term health outcomes of persons with COVID-19, including by race and ethnicity (September 2020
report).
Status: Open
Comment: CDC agreed with our recommendation. In response to our recommendation, CDC
noted in October 2020 that the agency is convening a team to develop a plan to monitor the long-
term health outcomes of persons with COVID-19 by identifying health care surveillance systems
that can electronically report health conditions to state and local health departments. CDC said
that as of January 2021 the agency had various eﬀorts underway with external partners to assess
long-term health outcomes. For example, CDC is funding a number of prospective studies in
partnership with universities to understand the long-term eﬀects of COVID-19 illness, including
a study examining the neurological health outcomes of a large cohort of Black and Hispanic or
Latino persons who had COVID-19. In addition, CDC stated the agency is analyzing electronic
health record data to describe health outcomes after COVID-19 diagnosis as well as analyzing
race and ethnicity in any data collected for long-term health eﬀects. We will continue to conduct
work examining HHS, CDC, and other component agencies’ ongoing work regarding indicators of
COVID-19 and disparities that exist for various populations.
Page 458
GAO-21-387

Recommendation. The Director of CDC should ensure that, as it makes updates to its federal
guidance related to reassessing schools’ operating status, the guidance is cogent, clear, and
internally consistent (September 2020 report).
Status: Closed
Comment: This recommendation is closed as implemented. CDC’s guidance for school operating
status during COVID-19 is more cogent, clear, and consistent. On February 12, 2021, CDC
released revised guidance for returning to in-person learning, as well as mitigation strategies
to help prevent and reduce the spread of COVID-19 in school settings. We found the guidance
consolidated much of the earlier guidance into one document that clearly displays all ﬁve of CDC’s
mitigation strategies and includes steps school oﬃcials should consider when deciding to reopen
schools. In addition, we identiﬁed increased eﬀorts to synchronize content across CDC’s website.
We found that CDC had removed some and updated other information and had begun including
summaries of changes made to the guidance at the top of some webpages.
Recommendation. The Secretary of Health and Human Services should ensure that the Director
of CDC clearly discloses the scientiﬁc rationale for any change to testing guidelines at the time the
change is made (November 2020 report).
Status: Open
Comment: HHS agreed with our recommendation and has begun to implement it. For example,
on February 16, 2021, CDC issued Interim Guidance on Testing Healthcare Personnel that stated
asymptomatic health care personnel who have recovered from COVID-19 may not need to
undergo repeat testing or quarantine in the case of another exposure within 3 months of their
initial diagnosis. To support this guidance, CDC’s website provided links to studies that explained
the scientiﬁc rationale. Additionally, CDC told us that it continues to consult with scientiﬁc
stakeholders when issuing or updating guidance documents. We will continue to monitor the
implementation of this recommendation to ensure that these eﬀorts continue.
HHS CMS
Recommendation. The Administrator of CMS should quickly develop a plan that further details
how the agency intends to respond to and implement, as appropriate, the 27 recommendations
in the ﬁnal report of the Coronavirus Commission on Safety and Quality in Nursing Homes, which
CMS released on September 16, 2020. Such a plan should include milestones that allow the agency
to track and report on the status of each recommendation; identify actions taken and planned,
including areas where CMS determined not to take action; and identify areas where the agency
could coordinate with other federal and nonfederal entities (November 2020 report).
Status: Open
Comment: HHS neither agreed nor disagreed with our recommendation. HHS oﬃcials highlighted
actions that CMS has taken related to Commission recommendations and said it would refer to
and act upon the Commission’s recommendations, as appropriate. As of February 2021, CMS had
no additional updates. We maintain that developing a plan that details how CMS will proceed with
remaining recommendations, includes milestones, and demonstrates that coordination with other
Page 459
GAO-21-387

federal and nonfederal stakeholders would improve CMS’s ability to systematically consider the
Commission’s recommendations going forward.
Recommendation. The Secretary of Health and Human Services, in consultation with CMS and
CDC, should develop a strategy to capture more complete data on conﬁrmed COVID-19 cases and
deaths in nursing homes retroactively back to January 1, 2020, and to clarify the extent to which
nursing homes have reported data before May 8, 2020. To the extent feasible, this strategy to
capture more complete data should incorporate information nursing homes previously reported
to CDC or to state or local public health oﬃces (September 2020 report).
Status: Open
Comment: HHS partially agreed with our recommendation. As of February 2021, no speciﬁc action
had been taken by HHS, although according to HHS it continues to consider how to implement our
recommendation.
HHS FDA
Recommendation. The Secretary of Health and Human Services should direct the FDA
Commissioner to identify ways to uniformly disclose to the public the information from FDA’s
scientiﬁc review of safety and eﬀectiveness data—similar to the public disclosure of the summary
safety and eﬀectiveness data supporting the approval of new drugs and biologics—when
issuing emergency use authorizations (EUA) for therapeutics and vaccines, and, if necessary,
seek the authority to publicly disclose such information (November 2020 report on vaccine and
therapeutics).
Status: Closed.
Comment: In response to our recommendation, FDA said it would explore approaches to achieve
the goal of transparency. On November 17, 2020, FDA made an announcement on the agency’s
ongoing commitment to transparency for COVID-19 EUAs. FDA also developed a process to
disclose its scientiﬁc review documents for therapeutic EUAs and released such summaries
for one previous therapeutic EUA and the two additional therapeutic EUAs issued since our
recommendation. These summaries disclosed information similar to what FDA releases to
support new drug approvals and biologic licensures. Additionally, for the two vaccine EUAs FDA
issued since our recommendation, FDA released decision memorandums containing detailed
information about FDA’s review of safety and eﬀectiveness data. FDA’s actions meet the intent of
our recommendation and will improve transparency.
Recommendation. The Commissioner of FDA should, as the agency makes changes to its
collection of drug manufacturing data, ensure the information obtained is complete and
accessible to help identify and mitigate supply chain vulnerabilities, including by working with
manufacturers and other federal agencies (e.g., the DOD and the Department of Veterans Aﬀairs
(VA)) and, if necessary, seek authority to obtain complete and accessible information (January 2021
report).
Status: Open
Page 460
GAO-21-387

Comment: HHS neither agreed nor disagreed with our recommendation. In HHS’s response, FDA
said that as the agency continues eﬀorts to enhance relevant authorities and close data gaps, it
will consider our recommendation.
Recommendation. The Commissioner of FDA should, as inspection plans for future ﬁscal years
are developed, ensure that such plans identify, analyze, and respond to the issues presented by
the backlog of inspections that could jeopardize the goal of risk-driven inspections (January 2021
report).
Status: Open
Comment: FDA agreed with our recommendation and stated that it is actively tracking the list of
sites that need to be inspected. FDA further noted that the size of the backlog will depend on the
extent to which alternative inspection tools are used.
Recommendation. The Commissioner of FDA should fully assess the agency’s alternative
inspection tools and consider whether these tools or others could provide the information needed
to supplement regular inspection activities or help meet the agency’s drug oversight objectives
when inspections are not possible in the future (January 2021 report).
Status: Open
Comment: FDA agreed with our recommendation and stated that it would continue to evaluate
these alternative tools. FDA stated that the resulting information will help determine how they can
be used to streamline and supplement regular inspection activities and to prioritize inspections
when normal inspection operations are not possible.
HHS Oce of the Assistant Secretary for Preparedness and Response
Recommendation. To improve the nation’s response to and preparedness for pandemics, the
Assistant Secretary for Preparedness and Response should establish a process for regularly
engaging with Congress and nonfederal stakeholders—including state, local, tribal, and territorial
governments and private industry—as HHS reﬁnes and implements a supply chain strategy for
pandemic preparedness, to include the role of the Strategic National Stockpile (January 2021
report).
Status: Open
Comment: HHS generally agreed with our recommendation, while noting that the term “engage”
is vague and unclear, and that they regularly engage with Congress and nonfederal stakeholders.
HHS added that improving the pandemic response capabilities of state, local, tribal, and territorial
governments is a priority.
Recommendation. The Assistant Secretary for Preparedness and Response, in coordination with
the appropriate oﬃces within HHS, should accurately report data in the federal procurement
database system and provide information that would allow the public to distinguish between
spending on other transaction agreements and procurement contracts (January 2021 report).
Page 461
GAO-21-387

Status: Open
Comment: HHS agreed with our recommendation and stated that it has taken steps to manually
identify its other transaction agreements in its contract writing system to allow the public
to distinguish between spending on agreements and procurement contracts in the Federal
Procurement Data System-Next Generation. HHS also plans to update its contract writing system.
Status of recommendations made to the Department of the Treasury
(Treasury)
Recommendation. The Secretary of the Treasury should ﬁnish developing and implement a
compliance monitoring plan that identiﬁes and responds to risks in the Payroll Support Program
to ensure program integrity and address potential fraud, including the use of funds for purposes
other than for the continuation of employee wages, salaries, and beneﬁts (November 2020 report).
Status: Open
Comment: Treasury neither agreed nor disagreed with our recommendation. In February 2021,
Treasury provided its Process Overview for CARES Operations Compliance Testing. This document
outlined the steps in Treasury’s compliance monitoring process. However, it did not include details
on how Treasury considers risks in this process, such as listing the automated tests it uses to
review recipient quarterly reports or the thresholds for these tests that trigger additional review.
The document also did not provide details on the penalties or remedies for noncompliance that
Treasury would use. According to Treasury oﬃcials, the agency is still developing and ﬁnalizing
these details. We will more fully evaluate Treasury’s eﬀorts to develop a compliance monitoring
plan when we can review more detailed documents from Treasury.
Recommendation. The Commissioner of Internal Revenue should consider cost-eﬀective options
for notifying ineligible recipients on how to return payments (June 2020 report).
Status: Open
Comment: Treasury and the Internal Revenue Service (IRS) have taken steps to implement our
recommendation. For example, IRS has instructions on its website requesting that individuals
voluntarily mail the appropriate economic impact payment (EIP) amount sent to the decedent
back to IRS, for both electronic and paper check payments. The envelopes in which paper checks
were sent also had a checkbox so people could indicate that the intended recipient was deceased,
and then mail the envelope back. Treasury has also held and cancelled payments made to
decedents, along with those that have been returned. As of January 29, 2021, around 57 percent
(just over $703 million) of the $1.2 billion in the ﬁrst round of economic impact payments (EIP 1)
sent to deceased individuals had been recovered. The recovered amount has not changed since
August 2020. As of February 2021, Treasury and IRS had not taken any further action to recoup
payments made to decedents that had not been returned, but they are considering whether they
will undertake further eﬀorts.
Page 462
GAO-21-387

Recommendation. The Secretary of the Treasury, in coordination with the Commissioner of
Internal Revenue, should update and reﬁne the estimate of eligible recipients who have yet to ﬁle
for an EIP to help target outreach and communications eﬀorts (September 2020 report).
Status: Open
Comment: Treasury and IRS neither agreed nor disagreed with our recommendation, but did take
some actions that are consistent with our recommendation. For example, in September 2020, the
agencies used tax return information to identify nearly 9 million individuals who had not received
an EIP 1 and then notiﬁed these individuals that they may be eligible for a payment. The letters
also provided instructions on how to request a payment. In addition, IRS publicly released detailed
zip code data from the notices to help community outreach partners with their own outreach
eﬀorts.
In January 2021, Treasury revised its estimate of eligible recipients who have yet to ﬁle for an EIP 1
to 8 million. According to Treasury oﬃcials, this estimate is based on the 9 million notices IRS sent
in September 2020. Treasury oﬃcials stated that it is likely that some of the 9 million recipients
have since claimed the EIP, but Treasury did not provide data supporting this claim.
Recommendation. The Secretary of the Treasury, in coordination with the Commissioner of
Internal Revenue, should make estimates of eligible recipients who have yet to ﬁle for an EIP, and
other relevant information, available to outreach partners to raise awareness about how and
when to ﬁle for EIPs (September 2020 report).
Status: Open
Comment: Treasury and IRS neither agreed nor disagreed with our recommendation, but did take
some actions that are consistent with our recommendation. For example, in September 2020, the
agencies used tax return information to identify nearly 9 million individuals who had not received
an EIP 1 and then notiﬁed these individuals that they may be eligible for a payment. The letters
also provided instructions on how to request a payment. In addition, IRS publicly released detailed
zip code data from the notices to community outreach partners with their own outreach eﬀorts.
In January 2021, Treasury revised its estimate of eligible recipients who have yet to ﬁle for an EIP 1
to 8 million. According to Treasury oﬃcials, this estimate is based on the 9 million notices IRS sent
in September 2020. Treasury oﬃcials stated that it is likely that some of the 9 million recipients
have since claimed the EIP, but Treasury did not provide data supporting this claim.
Recommendation. The Secretary of the Treasury, in coordination with the Commissioner of
Internal Revenue, should begin tracking and publicly reporting the number of individuals who
were mailed an EIP notiﬁcation letter and subsequently ﬁled for and received an EIP, and use that
information to inform ongoing outreach and communications eﬀorts (November 2020 report).
Status: Open
Comment: Treasury and IRS agreed with this recommendation. According to Treasury oﬃcials,
Treasury began analyzing data in January 2021 on those individuals who had received a notice and
subsequently ﬁled for and received an EIP 1. As of the time of this report, Treasury’s analysis of
Page 463
GAO-21-387

these data was ongoing. Treasury has not reported any results or provided a timeline for when it
plans to complete the analysis.
Recommendation. The Commissioner of Internal Revenue should update the Form 1040-X
instructions to include information on the electronic ﬁling capability for tax year 2019 (November
2020 report).
Status: Open
Comment: IRS agreed with our recommendation and said that it would start to update the Form
1040-X instructions to include information on the electronic ﬁling (e-ﬁle) capability for tax year
2019.
As of early December 2020, IRS planned to include this information in the next routine annual
update of the instructions with a mid-2021 release, rather than updating them sooner, out of
cycle. According to IRS, the normal revision process takes 10 months to complete properly, and
would be diﬃcult to complete in a shorter time frame. IRS’s planned revision will occur after
the deadline for submitting an application for a tentative refund via the temporary electronic
fax procedures, which for some taxpayers, may require an accompanying Form 1040-X. This
means that taxpayers who ﬁled their 1040-X before the December 31 deadline with the temporary
procedures did not ﬁnd the e-ﬁle capability in the form instructions. However, some taxpayers will
use Form 1040-X for other CARES Act refunds after that deadline, so instructions that are updated
in tax year 2021 would still help ensure these taxpayers are aware of this option. A timelier update
to the instructions would help taxpayers ﬁling the 1040-X between now and when the annual
update to the instructions occurs in mid-2021.
In the meantime, IRS previously posted information about the e-ﬁle availability on the Form 1040-X
product page at IRS.gov, which is referenced in the ﬁrst paragraph of the Form 1040-X instructions.
We will continue to monitor any updates to this page and the instructions.
Status of recommendations made to the Department of Labor (DOL)
Recommendation. The Secretary of Labor should, in consultation with the Small Business
Administration (SBA) and Treasury, immediately provide information to state unemployment
agencies that speciﬁcally addresses SBA's Paycheck Protection Program (PPP) loans, and the risk of
improper payments associated with these loans (June 2020 report).
Status: Closed
Comment: DOL neither agreed nor disagreed with our recommendation. Following our
recommendation, DOL issued guidance on August 12, 2020, that clariﬁed that individuals working
full-time and being paid through PPP are not eligible for unemployment insurance (UI), and
that individuals working part-time and being paid through PPP would be subject to certain
state policies, including state policies on partial unemployment to determine their eligibility
for UI beneﬁts. Further, the guidance clariﬁed that individuals being paid through PPP but not
Page 464
GAO-21-387

performing any services would similarly be subject to certain provisions of state law, and noted
that an individual receiving full compensation would be ineligible for UI.
Recommendation. The Secretary of Labor should ensure the Oﬃce of Unemployment Insurance
revises its weekly news releases to clarify that in the current unemployment environment, the
numbers it reports for weeks of unemployment claimed do not accurately estimate the number of
unique individuals claiming beneﬁts (November 2020 report).
Status: Closed
Comment: DOL’s weekly news release of December 10, 2020, clariﬁed that the numbers reported
for weeks of UI beneﬁts claimed do not represent the number of unique individuals claiming
beneﬁts.
Recommendation. The Secretary of Labor should ensure the Oﬃce of Unemployment Insurance
pursues options to report the actual number of distinct individuals claiming beneﬁts, such as by
collecting these already available data from states, starting from January 2020 onward (November
2020 report).
Status: Open
Comment: DOL partially agreed with our recommendation. Speciﬁcally, DOL agreed to pursue
options to report the actual number of distinct individuals claiming UI beneﬁts. However, DOL did
not agree with the retroactive eﬀective date of the reporting. DOL indicated that state UI programs
may face challenges implementing any new reporting requirements, particularly retroactively.
In addition, DOL stated that the requirements to provide notice and comment for the new data
collection could take up to a year to complete.
We maintain that DOL should pursue options to report the actual number of distinct individuals
claiming UI beneﬁts, retroactive to January 2020. These data are vital to understanding how many
individuals are receiving UI beneﬁts, as well as the size of the population supported by the UI
system during the pandemic, especially as Congress again expanded UI beneﬁts in December
2020 and March 2021. Even if the information is unavailable for some time, reporting numbers
retroactively, beginning with calendar year 2020, would help DOL and policy makers identify
lessons learned about the administration and utilization of regular and expanded UI beneﬁt
programs during the pandemic. Given the substantial investment in UI programs during the
pandemic, an accurate accounting of the size of the population supported by this funding, even
retroactively, may be critical to understanding the eﬃciency and eﬀectiveness of the nation’s
response to unemployment during the pandemic.
As of March 18, 2021, this recommendation remained open, as DOL had not begun reporting the
actual number of unique individuals claiming UI beneﬁts on a weekly basis in its UI news releases.
We encourage DOL to pursue options to report the actual number of individuals claiming beneﬁts
in the most feasible and least burdensome way. Collecting data from states is one way DOL can
address the recommendation, but DOL could also develop other ways of gathering and reporting
this information.
Page 465
GAO-21-387

Recommendation. The Secretary of Labor should ensure the Oﬃce of Unemployment
Insurance collects data from states on the amount of overpayments recovered in the Pandemic
Unemployment Assistance (PUA) program, similar to the regular UI program (January 2021 report).
Status: Open
Comment: DOL agreed with our recommendation to collect data from states on the amount
of overpayments recovered in the PUA program. On January 8, 2021, DOL took the ﬁrst step
toward implementing our recommendation by issuing new guidance and updated instructions
for reporting PUA program activities. Speciﬁcally, DOL revised its PUA reporting instrument to
collect PUA overpayment recovery data from states. As of March 15, 2021, this recommendation
remained open, as just 14 states had begun reporting some data on the amount of PUA
overpayments recovered. We will continue to monitor state reporting of PUA overpayment
recovery data.
Recommendation. The Assistant Secretary of Labor for Occupational Safety and Health should
develop a plan, with time frames, to implement the agency’s oversight processes for COVID-19-
adapted enforcement methods, as described in its pandemic enforcement policies (January 2021
report).
Status: Open
Comment: DOL neither agreed nor disagreed with our recommendation. In February 2021,
the Occupational Safety and Health Administration (OSHA) provided an update on its plans to
implement some oversight processes, but these plans did not include speciﬁc time frames or fully
address the processes to oversee OSHA’s use of adapted enforcement methods, as outlined in
the agency’s pandemic enforcement policies. For example, OSHA provided no plans to perform
an on-site component for remote inspections, or to perform follow-up inspections speciﬁcally
for informal inquiries conducted in place of inspections. As we reported in January 2021, without
this monitoring, the agency lacks information on workplace hazards that may have been missed
when using adapted enforcement methods and on how eﬀective these methods have been overall
in identifying hazards. Our review of Worker Safety and Health during the COVID-19 pandemic
is ongoing. We will continue to examine OSHA’s eﬀorts to implement its oversight processes for
COVID-19-adapted enforcement methods.
Recommendation. The Assistant Secretary of Labor for Occupational Safety and Health should
ensure that the OSHA Information System includes comprehensive information on use of the
agency’s COVID-19-adapted enforcement methods suﬃcient to inform its oversight processes for
these methods (January 2021 report).
Status: Open
Comment: DOL neither agreed nor disagreed with our recommendation. In February 2021, OSHA
said that the agency believes its current OSHA Information System coding related to COVID-19
and adapted enforcement methods is suﬃcient to enable agency oversight, and it will add new
coding if and when it is needed. We continue to believe that there are gaps in OSHA Information
System coding that prevent reliable tracking of some of the agency’s adapted enforcement
methods. Our review of Worker Safety and Health during the COVID-19 pandemic is ongoing. We
Page 466
GAO-21-387

will continue to examine OSHA’s eﬀorts to ensure that the OSHA Information System includes
suﬃcient information to inform its oversight processes.
Recommendation. The Assistant Secretary of Labor for Occupational Safety and Health should
determine what additional data may be needed from employers or other sources to better target
the agency’s COVID-19 enforcement eﬀorts (January 2021 report).
Status: Open
Comment: DOL neither agreed nor disagreed with our recommendation. In February 2021,
OSHA said that it had considered our recommendation and has determined that it does not
need additional information from employers to identify where pandemic-related enforcement
should be targeted. OSHA also said that, pursuant to the President’s January 21, 2021, executive
order on Protecting Worker Health and Safety, OSHA is working to launch a national program to
focus OSHA’s COVID-19-related enforcement eﬀorts on violations that put the largest number
of workers at serious risk or are contrary to anti-retaliation principles. Our review of Worker
Safety and Health during the COVID-19 pandemic is ongoing. We will continue to examine OSHA’s
eﬀorts in order to determine whether actions taken, including the implementation of OSHA’s new
national program, address our recommendation.
Status of recommendations made to the Small Business Administration
(SBA)
Recommendation. The Administrator of SBA should develop and implement plans to identify and
respond to risks in PPP to ensure program integrity, achieve program eﬀectiveness, and address
potential fraud, including in loans of $2 million or less (June 2020 report).
Status: Open
Comment: At the time of our report, SBA neither agreed nor disagreed with our recommendation.
Since then, SBA oﬃcials have said the agency has completed oversight plans, but SBA has not
provided documentation that fully details these plans. As we reported in September 2020, SBA
has said that it plans to review all PPP loans of $2 million or more and further stated that it may
review any PPP loan it deems appropriate, including loans of less than $2 million. In late December
2020, SBA provided a Loan Review Plan for the loan review process. The document describes three
steps in the process: automated screenings of all loans, manual reviews of selected loans, and
quality control reviews to ensure the quality, completeness, and consistency of the review process.
Although the draft plan references detailed policies and procedures for some loan reviews and
loan forgiveness reviews, they were not included in the document we received. SBA oﬃcials told us
these policies and procedures were being updated. In February 2021, SBA provided all but one of
the documents referenced in the plan and stated that it was still ﬁnalizing the last document. The
documents SBA provided include additional details on how SBA and its contractors will conduct
the various reviews. We continue to review these documents to determine the extent to which
they address our recommendation.
Page 467
GAO-21-387

Recommendation. The Administrator of SBA should expeditiously estimate improper payments
and report estimates and error rates for PPP due to concerns about the possibility that improper
payments, including those resulting from fraudulent activity, could be widespread (November
2020 report).
Status: Open
Comment: SBA neither agreed nor disagreed with our recommendation at that time. In response
to our recommendation, SBA stated that it was planning to conduct improper payment testing
for PPP and that it takes improper payments seriously. SBA oﬃcials stated that it has submitted
the sampling plan to the Oﬃce of Management and Budget (OMB) and will use this sampling plan
to estimate both improper payments and error rates for PPP. We will continue to monitor the
agency's actions to address this recommendation.
Recommendation. The Administrator of SBA should develop and implement portfolio-level
data analytics across Economic Injury Disaster Loan (EIDL) program loans and advances made
in response to COVID-19 as a means to detect potentially ineligible and fraudulent applications
(January 2021 report).
Status: Open
Comment: SBA neither agreed nor disagreed with our recommendation. SBA took issue with our
ﬁnding that potentially ineligible businesses received EIDL advances and loans. SBA mentioned
actions it takes to prevent payments to ineligible businesses for loans, such as conducting manual
reviews of applications in prohibited categories and approving them upon further determination
that they were eligible. According to SBA, it declined most applications in three prohibited business
categories we identiﬁed (adult entertainment, casinos, and marijuana shops) following the manual
reviews and approved some applications in these categories after manual reviews indicated
that they were eligible. However, SBA did not provide any documentation that would enable us
to verify the results of its manual reviews. In addition, we identiﬁed other prohibited business
categories (multi-level marketing, insurance, and real estate development) where potentially
ineligible businesses received EIDL loans. SBA did not address these other prohibited categories
in its comments. Further, to date SBA has not provided us information we have requested on
actions it and its contractors take to prevent payments to ineligible businesses. Therefore, we lack
assurance that the actions SBA takes are eﬀective in identifying ineligible businesses.
Our analysis was intended to provide an illustration of how fraud risk indicators can point to
vulnerabilities typically managed through a fraud risk management approach. Such indicators
are especially important in programs with heavy reliance on borrower certiﬁcations. We maintain
that portfolio-level data analytics could help SBA manage its risk of providing funds to ineligible
businesses.
Status of recommendations made to OMB
Recommendation. The Director of OMB should develop and issue guidance directing agencies
to include COVID-19 relief funding with associated key risks, such as provisions contained in the
Page 468
GAO-21-387

CARES Act and other relief legislation that potentially increase the risk of improper payments
or changes to existing program eligibility rules, as part of their improper payment estimation
methodologies. This should especially be required for already existing federal programs that
received COVID-19 relief funding (November 2020 report).
Status: Open
Comment: As of January 2021, OMB had not issued new guidance to address our
recommendation. In January 2021, OMB staﬀ stated they believe current OMB guidance
suﬃciently addresses our recommendation and concerns. In November 2020, we reported that
although OMB issued a memorandum providing agencies the option to incorporate new COVID-19
relief funding into their normal sampling processes, it did not speciﬁcally direct agencies to do so.
In addition, the guidance did not direct agencies to consider associated risks, such as changes to
eligibility rules and diﬀerent payment processes, as part of their improper payment estimation
methodologies. Further, OMB staﬀ stated that OMB is actively coordinating and engaging with
the Pandemic Response Accountability Committee and Inspectors General to share and discuss
information relevant to COVID-19 spending risks and improper payment reduction strategies. We
continue to maintain that without OMB guidance for agencies to include COVID-19 relief funding
and associated key risks, as part of their improper payment estimation methodologies, agencies
are at increased risk that their processes may not result in reliable estimates, calling into question
their usefulness for developing eﬀective corrective actions.
Recommendation. The Director of OMB, in consultation with Treasury, should issue the
addendum to the 2020 Compliance Supplement as soon as possible to provide the necessary
audit guidance (September 2020 report).
Status: Closed
Comment: OMB neither agreed nor disagreed with the recommendation. OMB issued the 2020
Compliance Supplement Addendum on December 22, 2020.
Status of recommendations made to VA
Recommendation. The VA Under Secretary for Health should develop a plan to ensure
inspections of state veterans homes occur during the COVID-19 pandemic—which may include
using in-person, a mix of virtual and in-person, or fully virtual inspections. (November 2020 report)
Status: Closed
Comment: On December 7, 2020, VA developed an interim process for reviewing records from
state veterans homes, such as evidence that previous corrective action plans were implemented
and documentation of infection control assessments, to assess the state veterans homes’
compliance with federal regulations. VA reported it implemented this process until a new
inspection contract could be awarded and completed 25 of these record reviews. VA awarded
a contract in January 2021, to conduct full virtual, blended virtual, or on-site inspections, and
Page 469
GAO-21-387

reported that the contractor began conducting inspections on January 19, 2021, which are
ongoing.
Recommendation. The VA Under Secretary for Health should collect timely data on COVID-19
cases and deaths in each state veterans home, which may include using data already collected by
CMS (November 2020 report).
Status: Open
Comment: As of February 2021, VA is collecting data on COVID-19 cases and deaths at most state
veterans homes in collaboration with CDC’s National Healthcare Safety Network.
On March 11, 2021, VA posted data on its website on COVID-19 cases and deaths among residents
and staﬀ at 130 out of 158 state veterans homes that reported weekly data to CDC. VA oﬃcials
told us they have reached out to all state veterans homes that are not reporting data, and states it
will continue to update the website weekly as required by Public Law 116-315.
We will continue to monitor their progress.
Status of recommendations made to the Department of Homeland
Security (DHS)
Recommendation. The Secretary of Homeland Security, in coordination with the Secretary of
Defense, should (1) revise the criteria in the 2019 National Interest Action code memorandum of
agreement to clearly identify steps they will take to obtain input from key federal agencies prior to
extending or closing a National Interest Action code, (2) establish timelines for evaluating the need
to extend a National Interest Action code, and (3) deﬁne what constitutes a consistent decrease
in contract actions and routine contract activity to ensure the criteria for extending or closing
the National Interest Action code reﬂect government-wide needs for tracking contract actions in
longer term emergencies, such as a pandemic (September 2020 report).
Status: Open
Comment: DHS disagreed with our recommendation. As of February 2021, a DOD oﬃcial said that
DHS and DOD were in the process of updating the agreement to clarify the steps they would take
to obtain input from other federal agencies and some of the factors considered when determining
whether to extend or close a NIA code. We will review the updated agreement when ﬁnalized to
determine whether it meets the intent of the recommendation.
Recommendation. The Administrator of FEMA—who heads one of the agencies leading the
COVID-19 response through the Uniﬁed Coordination Group—consistent with its roles and
responsibilities, should work with relevant federal, state, territorial, and tribal stakeholders to
devise interim solutions, such as systems and guidance and dissemination of best practices, to
help states enhance their ability to track the status of supply requests and plan for supply needs
for the remainder of the COVID-19 pandemic response (September 2020 report).
Page 470
GAO-21-387

Status: Open
Comment: DHS disagreed with our recommendation, noting, among other things, the work that it
had done to manage the medical supply chain and increase supply availability.
As of February 2021, FEMA has not taken action to devise interim solutions that would
systematically help states, tribes, and territories eﬀectively track, manage, and plan for supplies
to carry out the COVID-19 pandemic response in the absence of state-level end-to-end logistics
capabilities that would track critical supplies required for a response of this scale . According to
FEMA oﬃcials, the challenges states, territories, and tribes reported have continued to improve.
These oﬃcials stated that FEMA has supported several states’ actions to enhance their logistics
capabilities and warehouse capacities, for example, by assigning logisticians to provide technical
assistance. In addition, on January 21, 2021, the President issued a memorandum that clariﬁed
and expanded the eligibility of certain supplies and announced that all supplies would be 100
percent federal cost share, which addresses some of the planning challenges we discussed in
making this recommendation. FEMA oﬃcials also said that most states now have a 30-60 day
PPE supply and many are using inventory management systems. However, without action across
the board to help states ensure they have the support they need to track, manage, and plan for
supplies, states, tribes, and territories on the front lines of the whole-of-nation COVID-19 response
may continue to face challenges that hamper their eﬀectiveness.
Status of recommendations made to DOD
Recommendation. The Secretary of Defense, in coordination with the Secretary of Homeland
Security, should (1) revise the criteria in the 2019 National Interest Action code memorandum of
agreement to clearly identify steps they will take to obtain input from key federal agencies prior to
extending or closing a National Interest Action code, (2) establish timelines for evaluating the need
to extend a National Interest Action code, and (3) deﬁne what constitutes a consistent decrease
in contract actions and routine contract activity to ensure the criteria for extending or closing
the National Interest Action code reﬂect government-wide needs for tracking contract actions in
longer term emergencies, such as a pandemic (September 2020 report)
Status: Open
Comment: DOD disagreed with our recommendation. As of February 2021, a DOD oﬃcial said
that DHS and DOD were in the process of updating the agreement to clarify the steps they would
take to obtain input from other federal agencies and some of the factors considered when
determining whether to extend or close a NIA code. We will review the updated agreement when
ﬁnalized to determine whether it meets the intent of the recommendation
Status of recommendation made to the Department of Commerce
Recommendation. The Assistant Administrator for the National Oceanic and Atmospheric
Administration Fisheries should develop a mechanism to track the progress of states, tribes, and
Page 471
GAO-21-387

territories in meeting timelines established in spend plans to disburse funds in an expedited and
eﬃcient manner (January 2021 report).
Status: Open
Comment: As of February 1, 2021, the agency had developed an electronic tracking tool to track
the disbursement of funds and had begun to input data into it based on approved spend plans.
The agency plans to update these data on a weekly basis as funds are disbursed. The agency
anticipates that all current and relevant data will be input into the tracking tool by May 2021 and
that data will continue to be added to it until all funding has been disbursed.
Status of matter for congressional consideration regarding the Social
Security Administration
Matter. To provide agencies access to the Social Security Administration’s more complete
set of death data, we urge Congress to provide Treasury with access to the Social Security
Administration’s full set of death records, and to require that Treasury consistently use it (June
2020 report).
Status: Closed
Comments: In December 2020, Congress passed and the President signed into law the
Consolidated Appropriations Act, 2021, which requires the Social Security Administration, to the
extent feasible, to share its full death data with Treasury’s Do Not Pay working system for a 3-
year period, eﬀective the date that is 3 years from enactment of this Act. Sharing this data will
allow agencies to enhance their eﬀorts to identify and prevent improper payments to deceased
individuals. Therefore, it will be important for the Social Security Administration and Treasury to
work together to implement this legislation.
Status of matter for congressional consideration regarding to the
Department of Transportation
Matter. We urge Congress to take legislative action to require the Secretary of Transportation to
work with relevant agencies and stakeholders, such as HHS and DHS, and members of the aviation
and public health sectors, to develop a national aviation preparedness plan to ensure safeguards
are in place to limit the spread of communicable disease threats from abroad while at the same
time minimizing any unnecessary interference with travel and trade (June 2020 report).
Status: Open
Comment: In May 2020, the House of Representatives passed H.R. 6800, referred to as the
HEROES Act, which would require the Department of Transportation, in coordination with HHS,
DHS, and other appropriate federal departments and agencies, to develop a national aviation
preparedness plan. Most recently, in September 2020, the Senate passed S. 3681, Ensuring
Health Safety in the Skies Act of 2020, which would require HHS, DHS, and the Department
Page 472
GAO-21-387

of Transportation to form a joint task force on air travel during and after the COVID-19 public
health emergency, among other provisions. Also, in October 2020, H.R. 8712, National Aviation
Preparedness Plan Act of 2020, was introduced. If enacted, this bill would require the Department
of Transportation, in collaboration with DHS, HHS, and other aviation stakeholders, to develop
a national plan to prepare the aviation industry for future communicable disease outbreaks.
Members of the House and Senate announced that they would reintroduce similar bills in the new
Congress. For example, in February 2021, H.R. 884 introduced the National Aviation Preparedness
Plan of 2021.
We again urge Congress to take swift action to require a national aviation preparedness plan,
without which the U.S. will not be as prepared to minimize and quickly respond to ongoing and
future communicable disease events.
Status of matter for congressional consideration regarding future
COVID-19 relief funds
Matter. In November 2020, we urged Congress to consider, in any future legislation appropriating
COVID-19 relief funds, designating all executive agency programs and activities making more
than $100 million in payments from COVID-19 relief funds as “susceptible to signiﬁcant improper
payments” (November 2020 report).
Status: Open
Comment: No new legislation designating executive agency programs and activities making more
than $100 million in payments from COVID-19 relief funds as “susceptible to signiﬁcant improper
payments” has been enacted to date.
Page 473
GAO-21-387

Appendix IV: Comments from the Department of Education
Page 474
GAO-21-387

Page 475
GAO-21-387

Page 476
GAO-21-387

Appendix V: Comments from the Federal Communications
Commission
Page 477
GAO-21-387

Page 478
GAO-21-387

Appendix VI: Comments from the Department of Health and
Human Services
Page 479
GAO-21-387

Page 480
GAO-21-387

Page 481
GAO-21-387

Page 482
GAO-21-387

Page 483
GAO-21-387

Page 484
GAO-21-387

Page 485
GAO-21-387

Page 486
GAO-21-387

Page 487
GAO-21-387

Appendix VII: Comments from the Department of Homeland
Security
Page 488
GAO-21-387

Page 489
GAO-21-387

Page 490
GAO-21-387

Page 491
GAO-21-387

Appendix VIII: Comments from the Internal Revenue Service
Page 492
GAO-21-387

Page 493
GAO-21-387

Page 494
GAO-21-387

Page 495
GAO-21-387

Appendix IX: Comments from the Department of Labor
Page 496
GAO-21-387

Page 497
GAO-21-387

Appendix X: Comments from the Small Business
Administration
Page 498
GAO-21-387

Page 499
GAO-21-387

Appendix XI: Comments from the United States Agency for
International Development
Page 500
GAO-21-387

Appendix XII: Comments from the Department of Veterans
Aairs
Page 501
GAO-21-387

Page 502
GAO-21-387

Page 503
GAO-21-387

Page 504
GAO-21-387

Page 505
GAO-21-387

Page 506
GAO-21-387

Contacts
Report Director(s)
A. Nicole Clowers
Managing Director, Health Care, (202) 512-7114, clowersa@gao.gov
Congressional Relations
Orice Williams Brown, Managing Director, williamso@gao.gov, (202) 512-4400
Public Aairs
Chuck Young, Managing Director, youngc1@gao.gov, (202) 512-4800
Strategic Planning and External Liaison
Stephen J. Sanford, Acting Managing Director,spel@gao.gov, (202) 512-4707
Obtaining Copies of GAO Reports and Testimony
The fastest and easiest way to obtain copies of GAO documents at no cost is through our website. Each
weekday afternoon, GAO posts on its website newly released reports, testimony, and correspondence. You
can also subscribe to GAO’s email updates to receive notiﬁcation of newly posted products.
Order by Phone
The price of each GAO publication reﬂects GAO’s cost of production and distribution. Pricing and ordering
information is posted on our website.
To Report Fraud, Waste, and Abuse in Federal Programs
Website: http://www.gao.gov/fraudnet/fraudnet.htm
Automated answering system: (800) 424-5454 or (202) 512-7470
Connect with GAO
Connect with GAO on Facebook, Flickr, LinkedIn, Twitter, and YouTube. Subscribe to our RSS Feeds or E-mail
updates. Listen to our Podcasts. Visit GAO on our website and read the Watchblog.
(104526)
Page 507
GAO-21-387

File and source

File: 21-387-sustained-federal-action-mar2021.pdf
Size: 15,302,310 bytes
SHA-256: 7d3517ff58f29d44aa5d5d39be5366083287a1bd5cad9b247e8a2b9378559ab2
Our copy: 21-387-sustained-federal-action-mar2021.pdf
Original: www.gao.gov

GAO-21-387, COVID-19: Sustained Federal Action Is Crucial as Pandemic Enters Its Second Year

Full text

File and source

Related records