HHS Conference Affords Glimpse Into ‘Reinvention’ of Federal Grants Management

As federal agencies continue their move towards a more data-centric approach to grants management, areas like grantee risk assessment and performance evaluation are positioned to reap the early benefits of the ongoing data revolution in government.

On June 6, attendees at the Department of Health and Human Services (HHS) Grants Management Conference in Shady Grove, MD were given glimpses of how data can be leveraged to help achieve mission objectives more effectively and efficiently.

Imagine creating efficiencies and reducing administrative burden by 1% annually and utilizing those funds for mission objectives.At HHS, improving efficiency by even a single percentage point can mean billions of dollars saved, said Michael Peckham, who heads up the Reinvent Grants Management initiative at HHS.

In fiscal year 2018, for example, about 67% of all federal grants came from HHS, totaling about $509 billion. Peckham, citing a study by the Federal Demonstration Partnership, said that an estimated 44% of awarded grant funds are spent on grantor and grantee overhead.

“Imagine creating efficiencies and reducing administrative burden by 1% annually” and utilizing those funds for mission objectives, he said.

In fact, a range of data-related reforms are already being rolled out and tested within HHS. These efforts are laying the foundation for the more efficient and effective use of federal grant funds in the coming years.

Using data to identify fraud risk

One of the benefits of standardizing and synchronizing federal grants-related data, for example, is that trends can be more easily identified and analyzed. This is particularly true in the areas of fraud and risk assessment.

In recent years, HHS has been able to leverage data analysis to identify and define grantee behaviors that are often linked to fraud.

Some of the fraud indicators identified by HHS and discussed at the conference include the following:

  • “Principals have established multiple companies to obtain the same or similar funding.”
  • “The SBC has no physical address or shares a physical address with another business or personal residence.”
  • “The company is a subsidiary of or affiliated with a larger ineligible organization.”
  • “A PI is employed by other companies or organizations and may not be primarily employed by applicant company.”
  • “There are product, supply or inventory overages that may indicate budgetary or scientific overlap with other projects.”

HHS is also currently developing a digital tool that will be designed to give grantors one-click access to applicant risk assessments.

These assessments will pull data from a wide range of government systems – for example, combining information on current and recent awards with information on past expense reports and audits. That data will also be filtered through machine learning algorithms to provide predictive analyses of potential areas of risk for federal grant applicants.

This digital tool, when it is rolled out, promises to make conducting research on potential grantees far more efficient for agencies like HHS. At the same time, it will help agencies better steward federal grant funds.


Results-oriented accountability for grants

Early in 2019, Congress enacted into law the Foundations for Evidence-Based Policymaking Act. This law, along with other related work that is part of the President’s Management Agenda (PMA), illustrates the federal government’s focus on utilizing data to better measure program performance.

The idea here is not simply to settle for grantee compliance, but to increase the focus on the program’s and grantee’s performance and outcomes.“Approximately $700 billion is invested annually through more than 1,800 diverse Federal grant programs listed on CFDA.gov,” reads a report from the PMA. “These funds support activities that touch every American, such as medical research, education, transportation infrastructure, workforce initiatives, economic development, and services for veterans. However, grant managers—including those that administer funds from inside the Federal Government and those from external organizations that receive Federal funds—report spending 40% of their time using antiquated processes to monitor compliance instead of data and analytics to monitor results.”

The idea here is not simply to settle for grantee compliance, but to increase the focus on the program’s and grantee’s performance and outcomes, making sure they align with and also advance the grantor’s mission.

This renewed emphasis on performance is increasingly viable, thanks to a growing consensus within the federal government on the importance of standardizing and synthesizing data.

“We think this is an opportunity to reset how we think about data across the government,” said Erica Zielewski, Senior Evidence Analyst at the Office of Management and Budget, at the HHS Grants Management Conference. “It’s really about creating an effective and efficient government and meeting our critical mission more effectively [by] using data and evidence.”