Fraud fears and messy data stall FEMA program for Covid victims


The federal government wants to help Americans pay for their families’ Covid-19-related funerals — if it can figure out how to keep the scam artists at bay.

The Federal Emergency Management Agency is planning a $2 billion pandemic funeral assistance program, using money set aside in the $2.3 trillion spending package that former President Donald Trump signed in December. But progress has stalled over concerns within the agency that the program is vulnerable to widespread fraud, according to two senior officials with direct knowledge of the situation.

FEMA has for decades helped Americans cover unexpected and uninsured expenses incurred when their family members die as a result of major disasters like hurricanes or earthquakes, or in other emergency settings. But with more than 500,000 people dead so far, the pandemic funeral program is poised to be the largest the agency has ever mounted. It may also be the messiest.

The Centers for Disease Control and Prevention, which collect mortality data on the pandemic, has advised FEMA that — for logistical and regulatory reasons — CDC cannot verify whether individual deaths are Covid-related. Instead, the disaster agency will need to lean on overburdened state health agencies and medical institutions to cross-reference federal data with death certificates.

Now FEMA is scrambling to find safeguards that would prevent fraudsters from forging death certificates in an attempt to collect thousands of dollars for funerals that either never happened or were for people who died from another cause.

“There’s more room for error here because more people have died with Covid,” said one of the senior officials, who requested anonymity to speak freely about the agency’s concerns. “At the same time, it takes a lot of effort to fake these documents. I don’t know if people are going to want to do all that for a potentially small payout.”

The official said FEMA will also likely run into situations where multiple family members submit for reimbursement for the same death.

The agency is still working on defining who will be able to apply for reimbursement, but officials said the program will be similar to the one implemented after Hurricane Katrina. FEMA plans to allocate anywhere from $3,000 to $7,000 to people whose family members died as a direct result of Covid-19 in 2020. Eligible funeral expenses will include the purchase of caskets, mortuary services, transportation of the dead, burial plots and cremation.The funding does not cover costs of funerals incurred during 2021, a spokesperson said.

Normally, state and federal officials at FEMA field offices review applicants’ documentation before they approve the payout. Those documents include death certificates, proof that the applicant is the dead person’s next of kin, and confirmation that funeral expenses were not paid for through other resources such as Veterans Affairs benefits. FEMA is considering implementing additional measures to authenticate the documents they receive from families participating in the Covid program.

Over the past several weeks, FEMA officials have met with senior officials at the CDC who track coronavirus-related deaths in an attempt to find a better way to ensure that those applying for reimbursement are presenting original documentation. FEMA officials asked the CDC for guidance on whether it could help match death certificates with mortality data collected by the federal government.

CDC officials said the state health agencies would have to take on the task in part because they have the most accurate and comprehensive data on deaths in their jurisdiction. In addition, state medical examiners’ offices and coroners already help FEMA in disaster-related funeral reimbursement situations by identifying whether someone died as a result of a given disaster or for some other, unrelated reason.

“The biggest challenge for FEMA is that all 50 states have different ways for accounting for deaths,” said Craig Fugate, the FEMA administrator during the Obama administration. “States have to certify that the death is disaster-specific. It could be an indirect impact like with the Texas winter storm disaster and the carbon monoxide poisoning. As long as the medical examiner notes it was related to the event, then everything is OK. The bigger challenge with Covid is identifying if Covid was the cause of death even if you had a preexisting condition.”

Counting the dead is complicated and the surge in deaths from the virus has muddied the process. While states have the most up-to-date death counts, they are still experiencing significant delays in tallying who has died from the virus. They are even further behind in reporting that information to the CDC. Agency officials say they are still waiting on states to submit Covid-19 death reports from the 2020 holiday season.

FEMA also will likely face issues when families submit for reimbursement but present death certificates, or other medical information, that do not support the claim that a person died as a result of contracting the virus.

States submit death data to the CDC through two parallel tracking systems. One relies on codes used on death certificates. The program scans for words like “Covid-19” to determine the cause of death for each individual. Physicians are required to list Covid-19 on the death certificate in order for someone to be counted in the state and federal tracking systems as having died of the virus. But not every Covid-19 death has been documented — particularly those that happened during the early days of the pandemic.

When the virus first emerged in the U.S., testing was limited and doctors were unclear exactly why their patients were dying. As the virus spread more rapidly, physicians learned to better identify symptoms of Covid-19 but did not always list the virus on the death certificate. In other situations, hospitals used the term “coronavirus” rather than “Covid-19” on the certificates and the CDC did not count those people as having died of the virus. Since then, the CDC has worked with states to investigate those deaths and recount them properly.

A senior FEMA official said the agency will be working with a contractor and training staff to help administer the funeral reimbursement program. A federal contract reviewed by POLITICO shows FEMA’s Community Survivor Assistance Section awarded $202 million to General Dynamics Information Technology (GDIT), a major contractor for the Department of Homeland Security and the Pentagon, to set up a contact center to provide funeral services assistance to family members of those who died from Covid-19 in 2020. The contract, awarded last week, is for two years of work.

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