**National Interstate Case Reconciliation (ICR) Project**

**Business Case**

**Administration for Children and Families**

**Office of Child Support Enforcement**

**370 L\'Enfant Promenade, S.W.**

**Washington, D.C. 20447**

**June 30, 2003**

This document was prepared for the Administration for Children and
Families, Office of Child Support Enforcement under Contract Number
CIO-SP2 by Northrop Grumman Mission Systems (formerly TRW, Inc.) The
work was authorized in compliance with the following specific task order
tracking number:

Contract Task Order Tracking Number: C-2183

Document Name: ICR Business Case

Date: June 30, 2003

**TABLE OF CONTENTS**

**EXECUTIVE SUMMARY** **1**

**SECTION 1: STATE CASE RECONCILIATION PROBLEMS 5**

1.1 Incorrect/Missing Other State Case Number 5

1.2 Case Status Discrepancies 6

1.3 Interstate Case Mismatches 7

1.4 Definition of an Interstate Case for ICR Purposes 7

**SECTION 2: PROBLEMS ENCOUNTERED WITH**

> **CURRENT RECONCILIATION METHODS 9**

2.1 Manual Effort 9

2.2 Standardization 10

2.3 Coordination with Other States 10

2.4 Limited Scope of State-to-State Reconciliations 11

**SECTION 3: ICR TECHNICAL APPROACH 12**

3.1 Evaluation Criteria 12

3.2 ICR Extract File Matching 13

3.2.1 State Develops Extract, Sends to ICR for Matching 14

3.2.2 State Does Not Develop Extract, \'Extract\'

> Derived from FCR 14

3.2.3 ICR Matching Process Routine 15

3.2.4 Files Returned to States 16

3.3 Evaluation of Extract File Matching 19

3.4 State Buy-In to ICR Extract File Matching 20

3.5 Alternative Approaches Examined for a National ICR 22

3.5.1 Action Transmittal (AT) 97-02 22

3.5.2 Case Information (CSI) Transaction 23

3.5.3 Expanded FCR Matching 24

3.5.4 Conclusion Drawn on Evaluation of Alternatives 26

**SECTION 4: NATIONAL ICR COST/BENEFIT ANALYSIS 27**

4.1 State Costs for a National ICR Program 27

4.2 State Cost Savings and Benefits of a National ICR 29

> 4.2.1 Resolve Open/Closed Case Discrepancies
>
> And Case Mismatches 30
>
> 4.2.2 Improve Electronic Funds Transfer (EFT) Processing 30
>
> 4.2.3 Improve CSENet Processing 31
>
> 4.2.4 Improve Communication Among States 32

4.3 OCSE Benefits of a National ICR 32

**SECTION 5: RISK ASSESSMENT AND MITIGATION PLAN 34**

**SECTION 6: BUSINESS CASE CONCLUSION 36**

6.1 Document Structure 36

6.2 Pilot Feasibility 37

6.3 Next Steps 38

**TABLE OF FIGURES**

Figure 3.2 ICR Extract File Matching 13

Figure 3.2.4-1 ICR Response File Processing 16

Figure 3.2.4-2 Reason Code Table 17

Figure 3.4 Recommended ICR Approach: State Breakdown

> By Level of Interest 21

Figure 5 Risk, Probability, and Mitigation Factors for a National ICR 34

# 

# EXECUTIVE SUMMARY

Successful completion of a national Interstate Case Reconciliation (ICR)
will be of significant value to states in effectively processing their
interstate caseloads. The ICR Business Case presents analyses, findings
and recommendations to determine a cost-effective approach for
performing a national reconciliation of interstate cases and provides a
clear rationale for the value of performing a national ICR. The approach
recommended in this document overcomes many of the current barriers
identified by the states to interstate caseload reconciliation.

The overarching goals of a national ICR are to:

-   Improve service to families with interstate cases,

-   Improve electronic communication among states,

-   Establish accurate state and national interstate case baselines, and

-   Establish clear accountability for interstate case processing.

In order to help gauge state buy-in to a national ICR and to determine
the best ICR approach, extensive input from all child support
jurisdictions was solicited. Conference calls were conducted with, or
written responses received from, 53 of the 54 child support
jurisdictions (as documented in the final Reconciliation Tracking Matrix
of March 4, 2003) during the first phase of this project. These calls
were instrumental in collecting state and ACF Regional Office input
necessary to document:

-   Most significant problems that cause interstate cases to become "out
    of sync,"

-   Most significant problems with currently employed reconciliation
    methods,

-   Criteria that should be applied to various ICR approaches to
    evaluate which approach, would best meet state needs and best
    dovetail with available state resources,

-   Cost/benefits of an interstate case reconciliation, and

-   Level of state interest in proceeding with a national ICR.

The potential ICR approaches that were discussed during the ICR
conference calls included: 1) CSENet-based exchange of files as
documented in Action Transmittal (AT) 97-02; 2) CSENet-based exchange of
data using the Case Information (CSI) transaction; 3) expanded Federal
Case Registry (FCR) matching; and 4) Extract File Matching, a
newly-designed methodology that matches cases from individual state
extract files of interstate cases and returns categorized responses as
to matches and mismatches (i.e., case data are not consistent, case
status is inconsistent, or a comparable case in the other state does not
exist). State call participants were asked to evaluate the feasibility
and effectiveness of each of these possible ICR approaches from their
state's perspective and provide feedback as to which approach best met
state needs. Each of these options is discussed in detail in Section 3
of this document with an analysis of how each met the evaluation
criteria discussed during the calls.

*Given state input and subsequent follow-up analysis of the possible
approaches to a national ICR, it is recommended that the Federal Office
of Child Support Enforcement (OCSE) commit to scheduling and
coordinating a national ICR utilizing the Extract File Matching
approach. The Extract File Matching approach received the greatest level
of preference (44 states) during the state conference calls.*

  -----------------------------------------------------------------------
  For example, ICR Extract File Matching was endorsed by North Dakota
  because it offers an innovative and comprehensive solution. As
  summarized by Pat Conrad of **North Dakota**, ***"At a time of tight
  budgets, the money we expend \[on a national ICR program\] will save us
  an enormous amount of time and money in the long run*."**

  -----------------------------------------------------------------------

Using ICR Extract File Matching, states' interstate cases submitted via
extract files would be fully matched against each other. As a backup,
for states that do not provide an extract of their interstate cases, an
'extract' would be derived from the FCR and compared against the other
states' extract files. While matching to an FCR 'extract' would afford
matching at a less precise level[^1], the inclusion of this feature as a
backup was perceived by states as a guarantee to them that the national
reconciliation effort would provide pointers to all of the states, even
those states that did not send extract files.

It is estimated that 48 states will provide extract files, and that an
FCR-derived 'extract' may need to be generated for six states. This is
based on scores assigned to states (on a range of "0" to "3") to assess
level of interest in participating in a national ICR using the Extract
File Matching approach. A matrix depicting the State Level of Interest
with scores assigned to each state is provided in Figure 3.4 in Section
3 of this document.

Another major feature of the ICR Extract File Matching that appealed to
state representatives concerns the file responses generated at the
federal level. Upon completion of the matching process, each state would
receive a formatted response dataset that clearly defines:

-   Cases that exactly match a case in another state,

-   Cases that essentially match another state's case but contain
    significant data discrepancies between the cases,

-   Open cases that matched closed cases in another state, and

-   Cases that a state presumed were interstate cases of which the other
    states have no record.

State representatives categorized it as *critical* that the response
files generated by a national reconciliation effort are organized in
such a way that the receiving state can automatically process exact
matches, and either verify that the correct other state case number is
stored on their automated system, or automatically make corrections to
the case number, if required. Maintaining other state case numbers was
brought up numerous times by state representatives as a major hurdle in
working interstate cases.

Additionally, state staff endorsed the breakdown of responses by reason
codes associated with data discrepancies that would allow the state
receiving the responses to quickly determine the next appropriate action
to take to resolve a discrepancy. By far, the most frequent complaint
about other reconciliation methods was the amount of time required to go
through the responses received from other states, particularly with
respect to those cases that involved line-by-line data comparisons to
determine differences requiring resolution.

To counter much of the time spent in the initial resolution of data
discrepancies, the recommended Extract File Matching approach identifies
exact matches so they can be processed automatically; and, furthermore,
identifies the nature of data discrepancies so state staff need not
waste time determining why a mismatch occurred. This feature responds to
a point emphasized repeatedly: ***a national ICR is of little value to
states if it simply provides case match/mismatch data without an
overriding structure that categorizes the data.***

+-----------------------------------------------------------------------+
| ***\"We like the idea of running the perfect matches directly into    |
| the system. It should work to enhance and expand our ongoing          |
| reconciliation efforts.  For states we have already reconciled with,  |
| it should allow for a fine tuning of already reconciled cases.\"***   |
|                                                                       |
| New Mexico Staff Representative                                       |
+-----------------------------------------------------------------------+

A detailed presentation of the Business Case follows, outlining the
factors and considerations that shaped the recommendation for OCSE to go
forward with a national ICR effort that employs the Extract File
Matching approach. The document consists of six sections, which are
outlined below. Note that the first three sections document state input
that led to the development of the evaluation criteria applied to test
the viability of potential ICR approaches.

**Section 1: State Case Reconciliation Problems.** This section defines
the major reasons interstate cases are not synchronized between states,
as defined by state and ACF Regional Office representatives during the
ICR conference calls. An understanding of these problems is critical to
evaluating the efficacy of potential ICR approaches.

**Section 2: Problems Encountered with Current Reconciliation Methods.**
This section describes the problems with current reconciliation methods
as identified by state staff. Clear identification of problems currently
being encountered helped shape the evaluation criteria state
representatives felt needed to be applied in selecting a national ICR
approach.

**Section 3: ICR Technical Approach.** This section presents ICR Extract
File Matching, the approach recommended for a national ICR based on
evaluation criteria developed with state and ACF Regional office staff.
The evaluation criteria are presented first, followed by a detailed
review of the ICR Extract File Matching process, how this approach
responds to state needs, and the anticipated buy-in of states to this
approach. This section also presents an examination of alternative
approaches considered for a national ICR, and the reasons why these
alternatives were not selected.

**Section 4: National Cost/Benefit Analysis.** This section outlines the
most significant benefits realized by states from completing individual
state-to-state reconciliations. State staff were asked during the ICR
conference calls if they had information concerning the dollar value of
benefits from state-to-state reconciliations. While no state
representative was able to precisely calculate such a value, state staff
were able to provide concrete examples of reconciliation benefits. This
section presents state examples of cost/benefits and provides
extrapolations of those benefits to a national scale, when possible. The
extent to which potential ICR approaches maximize or degrade these
benefits became a significant evaluation criterion in focusing on a
recommended approach.

**Section 5: Risk Assessment and Mitigation Plan.** This section
discusses the inherent risks involved in moving forward with a national
ICR and the recommended Extract File Matching approach. Each risk is
evaluated as to probability of occurrence and mitigating actions.

**Section 6: Business Case Conclusion.** This section concludes the
Business Case by reiterating the contents of this document, discussing
pilot study considerations, and presenting the next steps to be taken
should OCSE decide to proceed with a national ICR, which is the
recommendation put forward in this ICR Business Case.

# 

# SECTION 1

# STATE CASE RECONCILIATION PROBLEMS

In this section, synchronization problems that plague interstate cases
are defined and discussed. Identifying synchronization problems common
to interstate cases is an important first step in the process of
evaluating potential ICR approaches. As emphasized by states, the
recommended ICR approach must effectively resolve these synchronization
problems.

One goal of conducting conference calls with state and ACF Regional
Office representatives was to identify why interstate cases are
difficult to keep synchronized between states. The most common
synchronization problems are:

-   Incorrect or missing other state case numbers,

-   Cases open in one state and closed in the other state, and

-   Cases presumed to be interstate by one state but of which the other
    state has no record.

These conditions are present to varying degrees in all of the states and
adversely affect the ability of states to efficiently manage interstate
caseloads.

## 1.1 Incorrect/Missing Other State Case Number

The most critical data element required to effectively manage an
interstate case is the correct case number used in the other state --
most commonly referred to as the "other state case number.\" This number
must be correctly maintained by both states working an interstate case
in order to effectively communicate with each other concerning a case
and take full advantage of automated EFT, CSENet capabilities, and the
use of other states' web sites to access case information.

Most state systems include edits to validate other state case numbers on
incoming EFT and CSENet transactions. If the other state case number is
incorrect, and that case cannot be found in the receiving state's
system, then the transaction is usually written to an EFT or CSENet
error file that must be manually processed by a worker. Given the cost
savings associated with automatically processing EFT payments, any
problem with this automated function that requires manual intervention
by a worker has a significant impact on a state's ability to process
payments in a cost effective and timely manner. Similarly, incorrect
other state case numbers on incoming CSENet transactions generally cause
errors that require manual intervention to process. These errors degrade
the state system's ability to automatically process incoming CSENet
transactions and may delay state action on an incoming request while
caseworkers identify the case requiring action in their system.

The other state case number also is a critical required field for the
Uniform Interstate Family Support Act (UIFSA) documents that are
exchanged by states. Having an incorrect other state case number on a
document makes it difficult for a receiving state to identify the case
requiring action.

There was concern expressed by 18 state representatives that certain
states require alternate identifiers (EFT PIN and depository numbers)
for accepting incoming EFT transactions. In order to facilitate the
transmission of outgoing EFT transactions to states that require
alternate identifiers, transmitting states are forced to store the EFT
PIN or depository number in their other state case number field. This
practice causes synchronization problems, since most states do not have
the ability to maintain multiple other state case identifiers in their
systems. While this allows the outgoing EFT transaction to be accepted
by the receiving state, it causes subsequent problems for outgoing
CSENet transactions to those same states because the transaction no
longer contains the correct other state case number.

As states move toward allowing access to case data via the Web, it will
become increasingly important for states to have the correct case number
assigned by other states in order to take advantage of this
technological option.

The lack of a nationally reconciled, correct baseline of other state
case numbers causes a significant degradation in the states' ability to
efficiently process their interstate cases. Given the importance of this
field in interstate processing, any effective approach to a national ICR
must focus on ensuring that states can establish correct other state
case numbers in a cost-effective, error-free manner.

## 1.2 Case Status Discrepancies

Case status discrepancies constitute another significant synchronization
problem in an interstate caseload. Of the 45 states that have completed
reconciliations, representatives of 36 states indicated problems with
open interstate cases in their systems when the corresponding case in
the other state has been closed. Many states report that case status
discrepancies remain a problem even though automated closure
notifications through CSENet and the FCR have been implemented to
mitigate this problem.

It is important that a national ICR enable states to directly reconcile
these discrepancies by including closed interstate cases in the matching
process. Based on state input, it also is important for the ICR process
to distinguish between open interstate cases that match to closed cases
in another state versus open interstate cases that do not match to
[any]{.underline} case in another state.

Knowing that a case exists in the other state, but is closed, provides
reconciliation workers with a concrete basis for deciding the next
appropriate action to take with respect to the open case in their
system. It allows for a more informed decision concerning the
reconciliation of case status discrepancies as opposed to interstate
case mismatches.

When the state with the open case is the initiating state, that state's
system or caseworker needs to determine whether an interstate action
should be re-initiated, or whether it should now be a one-state case. In
situations where the only open case is the responding state's case, the
responding state's staff should determine whether there is a need to
request information on the case, or whether the case should be closed.

Reconciliation of case status discrepancies using closed cases has many
advantages. It eliminates unnecessary interstate cases from caseloads,
prompts needed actions to be re-initiated, and promotes one-state
enforcement actions that are more cost-effective and efficient than two-
state actions. Resolving these discrepancies allows state staff to focus
their efforts on those interstate cases that truly require attention and
increase their collections ratio for interstate cases in the process.
During the ICR conference calls, 21 states expressed a preference for
including closed cases in the matching process and notifying both states
when a case is open in one state and closed in the other. Only four
states wanted to limit matching to open cases.

## 1.3 Interstate Case Mismatches

The final synchronization problem for interstate caseloads identified
during the ICR conference calls was interstate case mismatches. State
representatives repeatedly brought up situations where they presumed
they had an interstate case in common with a state, only to find that
the other state had no record of that case in their system. Interstate
case mismatches seem to be more common when the state with the existing
case is the initiating state; however, mismatches also can occur when
the existing case belongs to the responding state.

The problems associated with this condition are similar to those caused
by the case status discrepancy discussed above. As with case status
discrepancies, resolving interstate case mismatches provides the same
benefits to states in terms of closing unnecessary interstate cases,
re-initiating needed interstate actions, and promoting the use of
one-state actions.

## 1.4 Definition of an Interstate Case for ICR Purposes

Many state representatives expressed the concern that a common
definition for an interstate case for ICR purposes must be defined and
applied by all states in order for a national ICR effort to achieve
standard and reliable results. The following are definitional elements
that will be disseminated to states to assist in determining which cases
should be submitted as interstate cases for ICR purposes:

-   A case requested by one state for another state to open and maintain
    for purposes of paternity or order establishment, and/or
    enforcement.

-   The state requesting this action is the "initiating" state; the
    other state is the "responding" state

-   Both states maintain identical cases on their systems, and both
    states would submit the interstate case for ICR purposes

-   Both open and closed interstate cases would be submitted for ICR
    purposes

-   Neither long-arm cases (which don\'t require services from the other
    state) nor limited services cases (where a case is not opened in the
    other state) would be submitted for ICR purposes.

The provision of these definitional elements should help eliminate
ambiguity for states in selecting cases for a national ICR.

# 

# SECTION 2

# PROBLEMS ENCOUNTERED WITH CURRENT RECONCILIATION METHODS

Just as the recommended ICR approach must address the root causes that
impact caseload synchronization, the recommended ICR approach also must
address the problems states have with current state-to-state
reconciliation methods.

State conference calls carefully explored and documented problems states
have encountered in attempting to reconcile their individual caseloads.
The most significant problems found in the 45 states that have completed
individual state-to-state reconciliations include:

-   Level of manual effort and resource commitment,

-   Lack of standardization,

-   Coordination with other states, and

-   Limited scope of the reconciliations.

## 2.1 Manual Effort

By far, state representatives expressed the most concern about the
amount of manual effort that is required to complete reconciliation with
another state. Of the 45 states that have performed state-to-state
reconciliations, only 13 have automated the process of matching another
state's file against their own state system database. Some of these
states also have automated different aspects of reconciling exceptions
through automated system updates based on exact matches with the other
state's cases and by categorizing the exceptions for the appropriate
next action.

Thirty-two states, however, use an entirely manual process to:

-   Compare the other state's file against their caseload,

-   Determine which cases match,

-   Update the other state case number as necessary, and

-   Identify exceptions that must then be reconciled with the other
    state.

This majority cited the level of manual effort required to match the
other state's file to their caseload and to update the other state\'s
case number in their system as the major problem with current
reconciliation procedures.

Representatives from all but three of the 45 states that have performed
reconciliations expressed their concern over the level of resources and
time needed to process the exceptions and data discrepancies uncovered
by their matching processes, regardless of whether the state's matching
process was manual or automated. While state staff understood that the
degree to which automation can be applied to exception processing is
limited, they consistently agreed that an effective national ICR
approach must provide some assistance in categorizing and clearly
defining exceptions identified by the matching process.

These state representatives agreed that OCSE could provide the greatest
assistance in minimizing the amount of manual reconciliation
intervention by implementing an ICR approach that:

-   Automates the matching of state caseloads, and

-   Categorizes the matching results in a defined, detailed manner that
    allows states to automate the processing of exact matches,
    prioritizes the exceptions to be reconciled first, and suggests the
    next appropriate action to be taken by the reconciliation worker.

Given the near unanimous state concern over the current level of manual
effort required to complete state-to-state reconciliations, the
recommended ICR approach must be formulated to satisfy the above
criteria as much as possible.

## 2.2 Standardization

Sixteen of the states that have performed state-to-state reconciliations
had problems with a lack of standardization in current reconciliation
methods. While some states have adhered to AT 97-02 standards for
exchanging reconciliation data, other states have adopted their own
unique file formats. This lack of standardization causes problems for
states that have attempted to automate their matching routines, since
these programs must be modified to accept different file formats from
different states.

In addition to file formats, state representatives suggested that OCSE
establish data standards for critical data elements such as other state
case number. They expressed a need to adopt standardized formats (e.g.,
padding other state case number with leading zeros) to simplify the
automated processing of reconciliation results.

While problematic for states, lack of standardized data elements is not
considered to be a significant problem for a national ICR effort that is
developed, managed, and enforced by OCSE since standardization would be
inherent in the national approach.

## 2.3 Coordination with Other States

Another problem state representatives cited with current reconciliation
procedures is the logistical burden of coordinating individual
reconciliations with other states. Individual reconciliations require a
two-way exchange of data between states in order to match caseloads. The
state systems then need to be updated with corrections from the
reconciliation process. Often state systems are programmed for follow-up
data exchanges based on the updates that were made. Each of these
interactions requires significant communication and coordination between
staff in the two states. This process has unproductive lag time built
into it as one state "waits" to receive files from another state. State
staff desiring to complete a reconciliation of the state's interstate
caseload with all of the other states must go through this data exchange
process 53 times. A national ICR approach would take the burden off
individual states by centralizing scheduling and managing roles while
providing response data to the states in a timely fashion.

## 2.4 Limited Scope of State-to-State Reconciliations

Two concerns were identified with respect to the number and scope of
completed state-to-state reconcilations. First, a full national
reconciliation pursued through individual state-to-state reconciliations
involves 54 jurisdictions reconciling with 53 other jurisdictions,
creating a universe of 2,862 individual reconciliations to be performed.
Based on reconciliation totals provided by the states, only 891 of these
reconciliations have been completed as of February 14, 2003.
Reconciliation totals from the Big 10 + 1 states indicate that these
states have completed 38 of the 110 possible reconciliations required to
reconcile their caseloads with each other.

Second, the majority of completed state-to-state reconciliations (653
out of a total of 891) have been limited to obligated cases for EFT
purposes only. These limited reconciliations ignore interstate cases
that require establishment services. Therefore, a significant segment of
the interstate caseload has not been reconciled in those states that
have performed reconciliations.

These statistics serve to illustrate the extent to which the national
interstate caseload remains unreconciled. Given the current status of
reconciliation activity, any recommended national ICR approach should
cast the broadest possible net to ensure that no significant potential
population of interstate cases is excluded from a national
reconciliation effort.

Based on the analysis of problems inherent in current reconciliation
methods, any potential national ICR solution must be evaluated according
to how the approach:

-   Minimizes manual intervention to complete the reconciliation, and

-   Includes the full population of interstate cases.

The effectiveness of any recommended national ICR approach must be
gauged according to how well it resolves synchronization problems in
interstate caseloads, and how well it resolves the problems inherent in
current reconciliation methods. In addition to these criteria, there
must be demonstrable benefits that flow from any national ICR.

# 

# SECTION 3

# ICR TECHNICAL APPROACH

This section presents **ICR Extract File Matching**, the recommended
approach for a national ICR. The recommendation of this approach is made
based on an evaluation of this approach, as well as an evaluation of
three other potential approaches, using criteria developed based on
communications with state staff. The evaluation criteria that were
developed are presented first, followed by a detailed presentation of
the Extract File Matching approach, how that approach measured against
the criteria and the anticipated buy-in of states to this approach.
Lastly, an examination of three other potential ICR approaches is
provided.

## 3.1 Evaluation Criteria 

Evaluation criteria were developed based on a dialogue with state staff
as to the root causes for interstate cases becoming unsynchronized, and
why problems were encountered during previous state-to-state
reconciliation efforts. Four potential approaches to a national ICR were
examined. These approaches are referred to as:

-   Action Transmittal (AT) 97-02

-   Case Information (CSI) Transaction

-   Expanded FCR Matching

-   Extract File Matching.

Each potential approach was analyzed based on the extent to which the
approach satisfied the following evaluation criteria:

-   Minimized the cost of processing reconciliation results by:

    -   Allowing for the automated processing of exact matches to
        establish a correct baseline of other state case numbers,

    -   Defining and categorizing reconciliation exceptions and
        discrepancies,

    -   Preventing the redundant reconciliation of cases from previous
        state-to-state reconciliations, and

    -   Minimizing unnecessary reconciliations of non-interstate cases;

-   Addressed the issue of closed cases; and

-   Included the full population of interstate cases.

*As a result of the application of the above evaluation criteria,
Extract File Matching is recommended as the approach OCSE should
undertake for the national ICR effort.*

The following sections present the ICR Extract File Matching approach,
assess the approach against the above evaluation criteria, address state
buy-in to the recommended approach, and present an evaluation of the
three alternative approaches that were considered.

## 

## 3.2 ICR Extract File Matching 

ICR Extract File Matching centers on the submission by states of
extracts of their interstate cases to OCSE for one-time matching at the
national level. These extracts would contain basic case and participant
data for every case in the state systems that fits the definition of an
interstate case as provided in Section 1.4. A submission window would be
designated for all participating states to submit their extracts. Upon
receipt of all of the state extracts, OCSE would run an extract file
matching routine and process each state's extract. At the completion of
the matching process, OCSE would send each state a formatted response
dataset that clearly defines:

-   Cases that exactly match a case in another state,

-   Cases that essentially match another state's case but contain
    significant data discrepancies between the cases,

-   Open cases that matched closed cases in another state, and

-   Cases that a state presumed were interstate cases of which the other
    states have no record.

Figure 3.2, ICR Extract File Matching, illustrates the recommended ICR
matching approach.

Figure 3.2 ICR Extract File Matching

The following sections walk through the diagram of ICR Extract File
Matching as depicted in Figure 3.2.

### 3.2.1 [State Develops Extract, Sends to ICR for Matching]{.underline}

States would extract basic case and participant data for each case that
meets the definition of an interstate case for ICR purposes. The basic
case data would include:

-   Submitting State Case Number

-   Submitting State Initiating/Responding Indicator

-   Submitting State Case Status (i.e., 'open' or 'closed')

-   Submitting State FIPS Code

-   Other State Case Number

-   Other State Initiating/Responding Indicator

-   Other State FIPS Code.

The basic data for each active participant on each submitted interstate
case would include:

-   SSN

-   Member ID

-   Participant Type

-   Participant Name

-   Date of Birth

-   Sex Code

State extracts would be submitted in a file format provided by OCSE and
via CONNECT:Direct, the secure transmission line currently used for
transmission of case and participant data to the FCR.

### 3.2.2 [State Does Not Develop Extract, 'Extract' Derived from FCR]{.underline}

Alternatively, for those states that do not submit an interstate case
extract, an 'extract' would be derived from the state's cases on the
FCR. The FCR-derived 'extracts' would contain similar information to
that submitted by ICR-participating states. A problem with using
FCR-derived 'extracts' is that the FCR would not contain a potentially
significant number of interstate cases. Missing from the FCR-derived
'extracts' would be:

-   Cases that were not submitted by states with their initial loads to
    the FCR in 1998 because the cases were already closed (i.e., closed
    cases were specifically excluded from initial loads);

-   Cases rejected by the FCR due to missing critical data elements
    (e.g., an SSN was not submitted or identified for either the CP,
    NCP, or PF); and

-   Cases not submitted by states because state staff knew the cases
    would be rejected for lacking necessary data.

FCR-derived 'extracts' would be accepted into the ICR matching routine
once assembled by the FCR development contractor following file formats
provided by the ICR project team.

### 3.2.3 [ICR Matching Process Routine]{.underline}

The matching routine developed for the ICR would process each state's
interstate extract against all other state extracts, including
FCR-derived 'extracts' for non-participating states. The matching
routine would first search for a corresponding case in another state's
extract by using the Other State FIPS Code and the Other State Case
Number as keys to find that case. If the other state's case were found,
the submitting state's case and the other state's case would be compared
automatically to determine the extent to which the case and participant
data match between the two cases.

If the other state's case could not be found based on the combination of
Other State FIPS Code and Other State Case Number, the program would
assign a reason code to indicate this mismatch and would then proceed to
search for each participant from the submitting state's case by SSN. If
the SSN search revealed a corresponding case for that participant in the
other state, the program would compare case and participant data between
the two cases to determine the extent to which they match.

If no corresponding case or participant was found in the other state,
the submitting state's case would be flagged as a case mismatch. This
designation would capture the situation in which the submitting state
had presumed it had a case in common with another state, only to
discover that the other state did not have a corresponding interstate
case on its system.

For cases that match, the program would compare the participant data to
determine if the cases have a child in common. At least one matching
participant on the two cases must be designated as a child on both of
the cases for the program to consider this a match. The response file
will contain the number of adults and children submitted by both states
and provide these counts along with the number of each that matched. The
program also would compare key case and participant data to identify
data discrepancies that exist between the two states that share the
case.

When the program finished the comparison of case and participant data
for matching cases, it would write a response record to the
reconciliation response file for the submitting state. This response
record would transmit all data from the match to the submitting state.
The data would include the number of adults and children submitted by
each state along with the number of each that matched between the two
cases, a series of reason codes categorizing the extent of the match,
and any critical data discrepancies identified by the matching program.
The reason codes would clearly define the following conditions:

-   All data match between the two cases: an exact match

-   The matching program failed to find any case in the other state
    based on a search using the submitting state's other state case
    number and based on a search for a child in common between the two
    states: a case mismatch

-   A case with a child in common was found in the other state, but the
    other state case number from the submitting state does not match
    this state\'s case number. Check the number of adults and children
    matched and compare it against the number of adults and children
    submitted to determine the extent to which participants matched
    between the two cases

-   Data discrepancies between the two cases involving the following
    case/participant data elements (a specific reason code relates to
    each specific data discrepancy):

    -   FIPS County Code

    -   Case Status (open in submitting state, closed in other state and
        vice-versa)

    -   SSN

    -   Member ID

    -   Participant Type

    -   Initiating/Responding Indicator

    -   Last Name

    -   Date of Birth

    -   Sex Code.

Once the response file for the submitting state is fully populated, the
file would be transmitted to the state via CONNECT:Direct.

### 3.2.4 [Files Returned to States]{.underline}

Upon receipt of the response file from the ICR Match routine state staff
can evaluate discrepancies, indicated by the associated reason codes to
determine what the appropriate next actions should be. The information
returned to the states should allow the system to update information
that is not consistent between the two states. Full use of other
available tools such as CSENet could be utilized for those instances in
which an action needs to be taken by another state, such as providing
closure reasons or case initiation.

Figure 3.2.4-1 ICR Response File Processing

On the previous page, Figure 3.2.4-1, ICR Response File Processing,
presents at a high level the results of the matching process in state
response. The specific reason codes identifying matches and mismatches,
descriptions, and recommended state actions are suggested in Figure
3.2.4-2, Reason Code Table.

Figure 3.2.4-2 Reason Code Table

+-------+--------------------------------+-----------------------------+
| **Rea | **Description**                | **Action**                  |
| son** |                                |                             |
|       |                                |                             |
| **C   |                                |                             |
| ode** |                                |                             |
+=======+================================+=============================+
| *     | **All information matches**.   | **None required**           |
| *00** |                                |                             |
+-------+--------------------------------+-----------------------------+
| *     | The **Case Number** submitted  | **As Initiating State** --  |
| *01** | as the Other State Case Number | Resend CSENet transaction,  |
|       | does not exist. The other      | if necessary, to reinitiate |
|       | state did not submit a case    | case.                       |
|       | that matches the case in your  |                             |
|       | state.                         | **As Responding State** --  |
|       |                                | Check with other state for  |
|       |                                | possible case closure. If   |
|       |                                | the state still wishes to   |
|       |                                | have the other state open a |
|       |                                | case on their behalf, a     |
|       |                                | CSENet transaction should   |
|       |                                | be initiated.               |
+-------+--------------------------------+-----------------------------+
| *     | The **Case Number** submitted  | **As Initiating State** -   |
| *02** | by the other state does not    | The state should update the |
|       | match the Other State Case     | Other State Case Number     |
|       | Number in your state; however, | with the new information.   |
|       | a matching case was found by   |                             |
|       | matching the participants. The | **As Responding State** --  |
|       | case number submitted by the   |                             |
|       | other state can be found in    | The state should update the |
|       | the New Case Number field. The | Other State Case Number     |
|       | number of participants that    | with the new information.   |
|       | matched can be determined by   |                             |
|       | interrogating the number of    |                             |
|       | adults and children matched,   |                             |
|       | and comparing them to the      |                             |
|       | number of adults and children  |                             |
|       | submitted.                     |                             |
+-------+--------------------------------+-----------------------------+
| *     | Positions 3 - 5 of the **FIPS  | **As Initiating State** -   |
| *03** | Code** submitted by the other  | The state should update the |
|       | state do not match positions   | Other State FIPS County     |
|       | 3 - 5 of the Other State FIPS  | Code with the new           |
|       | Code in your state\'s record.  | information.                |
|       | The FIPS County Code submitted |                             |
|       | by the other state can be      | **As Responding State** --  |
|       | found in the New FIPS Code     |                             |
|       | field.                         | The state should update the |
|       |                                | Other State FIPS County     |
|       |                                | Code with the new           |
|       |                                | information.                |
+-------+--------------------------------+-----------------------------+
| *     | The **SSN** submitted by the   | **As Initiating State-**    |
| *04** | other state does not match the | The state should check for  |
|       | SSN for the participant in     | a verified SSN for the      |
|       | your state; however, the case  | participant in its system.  |
|       | number and participant type    | If the SSN is not verified  |
|       | are the same. The SSN          | or is missing, the state    |
|       | submitted by the other state   | may want to consider using  |
|       | can be found in the Other      | the other state\'s SSN.     |
|       | State SSN field.               |                             |
|       |                                | **As Responding State** --  |
|       |                                |                             |
|       |                                | The state should check for  |
|       |                                | a verified SSN for the      |
|       |                                | participant in its system.  |
|       |                                | If the SSN is not verified  |
|       |                                | or, is missing the state    |
|       |                                | may want to consider using  |
|       |                                | the initiating state\'s     |
|       |                                | SSN.                        |
+-------+--------------------------------+-----------------------------+
| *     | The **Member ID** submitted by | **As Initiating State** -   |
| *05** | the other state does not match | The state should update the |
|       | the Member ID in your state    | Other State Member ID on    |
|       | for the participant. The       | its system.                 |
|       | Member ID submitted by the     |                             |
|       | other state can be found in    | **As Responding State** --  |
|       | the New Member ID field. This  |                             |
|       | reason code is conditional and | The state should update the |
|       | based on whether the Other     | Other State Member ID on    |
|       | State Member ID was supplied.  | its system.                 |
+-------+--------------------------------+-----------------------------+
| *     | The **Participant Type**       | **As Initiating State** -   |
| *06** | submitted by the other state   | The state should either     |
|       | did not match the Participant  | update the Participant Type |
|       | Type in your state for the     | on its system, or generate  |
|       | participant. The Participant   | a request for more          |
|       | Type submitted by the other    | information.                |
|       | state can be found in the new  |                             |
|       | Participant Type field.        | **As Responding State** --  |
|       |                                |                             |
|       |                                | The state should update the |
|       |                                | Participant Type on its     |
|       |                                | system, or generate a       |
|       |                                | request for more            |
|       |                                | information.                |
+-------+--------------------------------+-----------------------------+
| *     | The **Case Status** in your    | **As Initiating State** -   |
| *07** | state indicates that the case  | If necessary, send a CSENet |
|       | is open; however, the matching | transaction to have the     |
|       | case submitted by the other    | case re-initiated in the    |
|       | state is closed.               | responding state.           |
|       |                                |                             |
|       |                                | **As Responding State** -   |
|       |                                | Send request for closure    |
|       |                                | reason to the initiating    |
|       |                                | state.                      |
+-------+--------------------------------+-----------------------------+
| *     | The **Case Status** in your    | **As Initiating State** --  |
| *08** | state indicates that its case  | Resend closure reason to    |
|       | is closed; however, the        | the responding state.       |
|       | matching case submitted by the |                             |
|       | other state is open.           | **As Responding State** -   |
|       |                                | Resend closure reason to    |
|       |                                | the initiating state        |
+-------+--------------------------------+-----------------------------+
| *     | The **Last Name** submitted by | Based on state policy and   |
| *09** | the other state does not match | depending on whether your   |
|       | the Last Name in your state    | state is the initiating or  |
|       | for the participant. The Last  | responding state, the Last  |
|       | Name submitted by the other    | Name should be updated with |
|       | state can be found in the      | the Last Name provided by   |
|       | Other State Last Name field.   | the other state.            |
+-------+--------------------------------+-----------------------------+
| *     | The **Date of Birth**          | Based on state policy and   |
| *10** | submitted by the other state   | depending on whether your   |
|       | does not match the Date of     | state is the initiating or  |
|       | Birth in your state for the    | responding state, the Date  |
|       | participant. The Date of Birth | of Birth should be updated  |
|       | submitted by the other state   | with the Date of Birth      |
|       | can be found in the Other      | provided by the other       |
|       | State Date of Birth field      | state.                      |
+-------+--------------------------------+-----------------------------+
| *     | The **Sex Code** submitted by  | Based on state policy and   |
| *11** | the other state does not match | depending on whether your   |
|       | the Sex Code in your state for | state is the initiating or  |
|       | the participant. The Sex Code  | responding state the Sex    |
|       | submitted by the other state   | Code should be updated with |
|       | can be found in the Other      | the Sex Code provided by    |
|       | State Sex Code field.          | the other state.            |
+-------+--------------------------------+-----------------------------+
| *     | The **Initiating/Responding    | The other state should be   |
| *12** | indicator** for the other      | contacted to determine what |
|       | state is different from what   | role each state plays in    |
|       | the other state has indicated  | the case.                   |
|       | on their file.                 |                             |
+-------+--------------------------------+-----------------------------+
| *     | The **Participant** was not    | Contact the other state to  |
| *13** | found in the Other State Case. | determine if this           |
|       | The case was found based on    | participant should be added |
|       | either the case number match   | to your case.               |
|       | or by matching at least one    |                             |
|       | child participant on both      |                             |
|       | cases. However, this           |                             |
|       | participant was not found.     |                             |
+-------+--------------------------------+-----------------------------+

## 3.3 Evaluation of Extract File Matching 

ICR Extract File Matching would fully support the automatic update of
other state case numbers in a flexible, cost-effective manner. The match
responses sent to states would clearly define matches between the child
participants on two cases in which the only case discrepancy is a
mismatch of the other state case number (i.e., the submitting state's
other state case number does not agree with the case number found in the
other state's extract). By comparing the number of adults' and
childrens' SSNs matched with the number of adults' and childrens' SSNs
submitted, the program allows state staff to decide what level of match
is sufficient to trigger the automatic update of the other state case
number in their systems.

The Extract File Matching approach categorizes reconciliation exceptions
and data discrepancies through the use of reason codes, as delineated in
figure 3.2.4-2, Reason Code Table. These codes are sufficiently detailed
to suggest the next appropriate action to be taken by the state system
or the reconciliation worker. The appropriate actions would be fully
addressed in supporting training material and user documentation. These
reason codes would provide states with the ability to prioritize
exception processing and help to minimize the costs of reconciling the
exceptions.

Closed cases would be directly addressed in the Extract File Matching
approach. The case status discrepancy codes would clearly identify open
cases in the submitting state that match closed cases in the other state
and vice-versa. The approach also would identify case mismatches in
which the submitting state presumes that an interstate relationship
existed and no corresponding case can be found in the other state.

Extract File Matching would include, for those states fully
participating by submitting file extracts, the full population of
interstate cases that meet the definition presented for ICR purposes.
This would include cases currently resident on the FCR, cases never
submitted by states to the FCR, and cases previously rejected by the
FCR.

The Extract File Matching approach would prevent the redundant
reconciliation of cases from previous state-to-state reconciliation
efforts, and it would minimize the reconciliation of non-interstate
cases. For states that have completed a large number of state-to-state
reconciliations, such as **Texas**, this process would simply validate
the results of those reconciliation efforts. If **Texas** interstate
cases were still synchronized with another state, **Texas** would
receive a large number of exact matches from that state in the **Texas**
response file. Since exact matches do not require any action on the part
of the state, **Texas** staff would be free to concentrate on those
exceptions that they deemed to be a high priority.

Finally, state extracts are limited to cases that states consider to be
interstate cases. Therefore, a match of cases between state extracts
would not include the matching of participants between a TANF
arrears-only case in one state and an ongoing current support case in
another.

## 3.4 State Buy-In to ICR Extract File Matching 

Obtaining the highest quality of interstate matches depends upon the
submission of interstate extract files by as many states as possible.
The greater the number of states that participate, the better the
reconciliation results. Therefore, the Extract File Matching approach
places a premium on obtaining state buy-in.

Based on input from 53 of 54 child support jurisdictions, there are a
sufficient number of probable state participants to warrant proceeding
with an ICR that utilizes Extract File Matching. It is anticipated from
the matrix provided in Figure 3.4, which captures states' level of
interest in participating in the Extract File Matching approach, that
extract files will be provided by 48 states.

State representatives expressed varying levels of concern in the ICR
conference calls over the resources required to create and submit a
state extract. The majority of state representatives said that it would
not be a problem as long as they were given sufficient lead time to
develop the extract program.

Most state representatives estimated that it would take from one to two
weeks to write and test an extract program. This is a reasonable
investment given the extent to which this approach maximizes the
benefits of a national ICR. Moreover, OCSE has committed to providing
technical assistance to the states. Based on OCSE experience with the
successful implementation of an expanded FPLS, technical support will be
critical to promoting and maintaining state participation.

All but three states expressed concern over the level of staff resources
required to process reconciliation exceptions. ICR Extract File Matching
addresses this concern by maximizing the extent to which reconciliation
responses can be automatically processed.

Figure 3.4 Recommended ICR Approach: State Breakdown by Level of
Interest

+-----------------------+----------------------------------------------+
| **Score**             | **States**                                   |
+=======================+==============================================+
| **32 States**         | Alabama, Alaska, Arizona, **California**,    |
|                       | Colorado, Delaware, District of Columbia,    |
| **Score of 3**        | **Florida**, **Georgia**, Hawaii,            |
|                       | **Illinois**, Indiana, Kansas, Kentucky,     |
| **\"Very              | Louisiana, Mississippi, Missouri, New        |
| Interested\"**        | Hampshire, **New Jersey**, New Mexico, **New |
|                       | York**, North Dakota, **Ohio**, Oklahoma,    |
|                       | **Pennsylvania**, Puerto Rico, South Dakota, |
|                       | Virgin Islands, Washington, West Virginia,   |
|                       | **Wisconsin**, Wyoming                       |
+-----------------------+----------------------------------------------+
| **16 States**         | Arkansas, Idaho, Maine, Maryland,            |
|                       | Massachusetts, **Michigan**, Minnesota,      |
| **Score of 2**        | Montana, Nevada, Oregon, Rhode Island,       |
|                       | Tennessee, **Texas**, Utah, Vermont,         |
| **\"Cautiously        | Virginia,                                    |
| Optimistic\"**        |                                              |
+-----------------------+----------------------------------------------+
| **4 States**          | Connecticut, Iowa, Nebraska, South Carolina  |
|                       |                                              |
| **Score of 1**        |                                              |
|                       |                                              |
| **\"Cautiously        |                                              |
| Pessimistic\"**       |                                              |
+-----------------------+----------------------------------------------+
| **1 State**           | North Carolina                               |
|                       |                                              |
| **Score of 0**        |                                              |
|                       |                                              |
| **Staff did not       |                                              |
| participate in        |                                              |
| conference call**     |                                              |
+-----------------------+----------------------------------------------+
| **1 State**           | Guam                                         |
|                       |                                              |
| **Staff unable to     |                                              |
| schedule**            |                                              |
|                       |                                              |
| **conference call**   |                                              |
+-----------------------+----------------------------------------------+
| **The median score    |                                              |
| was 2.49, signifying  |                                              |
| a high level of       |                                              |
| interest in the**     |                                              |
|                       |                                              |
| **Extract File        |                                              |
| Matching approach.**  |                                              |
|                       |                                              |
| **\_\_\               |                                              |
| _\_\_\_\_\_\_\_\_\_** |                                              |
|                       |                                              |
| (Big 10+1 states are  |                                              |
| highlighted in        |                                              |
| **bold**)             |                                              |
+-----------------------+----------------------------------------------+

When states were asked their opinion of the Extract File Matching
approach over other alternatives, 44 of the states expressed that they
favored it over other alternatives. The exceptions are shown below.

-   **Guam** did not participate in a conference call, so state staff
    assessment could not be ascertained.

-   **South Carolina** state representatives were pessimistic as to
    their ability to participate given their lack of a statewide system.

-   **North Carolina** staff questioned the need for any national ICR.
    North Carolina only communicated via e-mail and declined to
    participate in a conference call.

-   **Connecticut, Maine, Tennessee, Vermont** and **Virginia** staff
    favored an FCR-based approach.

-   **Nebraska** staff favored a CSI transaction approach; similar to
    the state-to-state reconciliation they conducted with Iowa.

-   **Iowa** staff preferred an approach that maintained reconciliation
    data on the Web, allowing for real-time state access.

It should be noted that some state conference call participants stated
that while they were assigned to participate in the calls and would have
input into the state's decision, they themselves did not have the
authority to make a decision on participation in a national ICR

## 3.5 Alternative Approaches Examined for a National ICR

This section summarizes the three other approaches considered for a
national ICR, and highlights the reasons they were not selected

### 3.5.1 [Action Transmittal (AT) 97-02]{.underline}

Some states have automated certain aspects of their individual
reconciliation procedures using AT 97-02 as their standard, and their
staff said that it would be an advantage for them if a national ICR
followed suit. The AT 97-02 encouraged states to implement an electronic
data exchange format of \"newly created or revised child support case
numbers\" prior to transmission to other states. The format included the
two states\' case numbers; the sending state\'s FIPS Code; CP and NCP
SSNs, names and DOBs; and a \'no match found\' error indicator.

When this approach was evaluated against what the majority of state
representatives relayed as important criteria for selecting a national
ICR process, however, two significant disadvantages became apparent:

-   The AT 97-02 reconciliation file format does not include child data.
    This lack of child data severely constrains the definition of an
    "exact" match. Data pertaining to the children on a case must be
    included in any matching process to guarantee exact case matches. It
    is unlikely that state staff would consider automatically validating
    and updating the other state case number based solely on an NCP/CP
    match between the two states' cases. The establishment of the
    correct other state case number is a critical prerequisite for
    realizing the most significant benefits of a national
    reconciliation. To be cost-effective, the recommended ICR approach
    should promote the ability of states to automatically update these
    identifiers. The AT 97-02 approach does not meet this test.

-   The AT 97-02 standards do not include closed cases in the file
    format. As documented in Section 1, states consider case status
    discrepancies to be one of the most significant synchronization
    problems plaguing interstate caseloads. As a result of individual
    state-to-state reconciliations, states have realized considerable
    cost savings by closing unnecessary interstate cases. Therefore, an
    effective national ICR approach must clearly identify open cases in
    one state that match to closed cases in another. The AT 97-02
    approach does not meet this test as well.

Since the AT 97-02 approach failed to meet two essential criteria that
are critical to maximizing the benefits of a national reconciliation,
this approach was not selected as the recommended approach.

### 3.5.2 [Case Information (CSI) Transaction]{.underline}

Using the CSI transaction for reconciliation purposes centers on
matching interstate caseloads and returning response data to the states
in the form of CSI transactions transmitted through CSENet. The CSI
transaction was developed as a means for states to obtain comprehensive
case data from each other.

A **Nebraska-Iowa** reconciliation is an example of a state partnership
in the creative use of the CSI transaction for reconciliation purposes.
**Nebraska** and **Iowa** successfully used a modified method of
triggering CSI transactions to reconcile their interstate cases with
each other. The states discovered approximately 2,800 cases in common.
Of these cases, 822 were identified as less than exact matches. The
remainder matched exactly.

**Iowa** also attempted to reconcile their interstate caseload with
**Connecticut** utilizing the CSI transaction. **Iowa** used 270
processing hours to match their caseload and process results from
**Connecticut**. Although the two states have fairly small caseloads,
**Connecticut** staff was not able to complete the reconciliation on
their end due to resource constraints. From this reconciliation effort,
**Iowa** matched on only 28 **Connecticut** cases and was able to load
only one of those cases onto the state system based on the CSI data.

In examining the viability of using a CSI transaction approach to a
national ICR the extent to which state systems can utilize pre-existing
CSI programs to facilitate the processing of reconciliation results must
be addressed. To meet the minimum certification standard for accepting
incoming CSI provide transactions, a state system needs to be able to
automatically process the transaction and display the contents to a
worker.

This standard does not require state systems to automatically update
case data with CSI data from a corresponding case in another state. Yet,
this is functionality (particularly in regards to correcting Other State
Case Numbers) can minimize the costs of manually processing
reconciliation results. The results of the **Iowa-Connecticut**
reconciliation cast some doubt on the cost-effectiveness of this
approach. Representatives from both states commented during their
respective conference calls that this reconciliation method required a
heavy utilization of staff resources and was labor-intensive. The number
of hours that **Iowa** staff devoted to their reconciliation with
**Connecticut**, as compared to the results of that reconciliation
attempt, seems to support this assessment.

The size of the CSI transaction also is cause for concern. The volume of
reconciliation response data that would be generated by a national
reconciliation effort would be considerable. Much of the CSI transaction
data is tangential to the requirements of reconciling cases. Generation
of CSI response transactions requires a state system to interrogate all
data blocks associated with a case, including those that do not pertain
to case reconciliation.

Based on the above concerns, utilization of the CSI transaction was not
considered viable for a national ICR. It represents an innovative
attempt by states to maximize the use of existing automated
functionality to reconcile interstate cases, but it is not viable given
the scale of a national reconciliation.

The CSI transaction, however, does have a role to play in a national
ICR. Depending upon a state\'s level of CSI automation, state staff may
find it useful to program their systems to automatically generate CSI
transactions when a case mismatch in the response files generated by
Extract File Matching points to the need for more case information to be
elicited from another state. This could be a more effective process for
obtaining case information from the other state than attempting to
contact staff in that state. The use of the CSI transaction will be
explored to determine applicability in the national ICR effort. Use of
the CSI transaction will be integrated into ICR training materials and
user documentation.

### 3.5.3 [Expanded FCR Matching]{.underline}

The FCR currently identifies participants in common between cases in
different states through the FCR-to-FCR proactive matching process.
Expanding FCR matching was examined as a possible approach for a
national ICR. This approach would allow for the reconciliation of
interstate cases entirely within the FCR.

Under an expanded FCR matching approach, the current proactive matching
routine would be modified to look for case groupings of participants
that matched between states. Unlike the current proactive match, this
case reconciliation match would be extended to the unverified files and
closed case files within the FCR to broaden the population of potential
interstate case matches. The primary matching configuration that this
routine would look for is a matching CP/NCP combination between states.
Further comparison of child data between the two cases would establish
whether the case participants matched exactly or matched to some lesser
degree.

The reconciliation results would be passed back to the states via the
FCR proactive match record. Existing filler fields within this record
would require modification to categorize how closely the participants in
the two cases matched, whether an open case in one state matched to a
case in the FCR closed case file for the other state, and the extent to
which discrepancies existed in key case and demographic data between two
cases that matched.

State staff could modify their existing proactive match processing
programs or create new programs to automatically update the other state
case number in some circumstances. The proactive match record would
contain the case number that the other state had reported to the FCR, so
that the receiving state could compare the other state case number in
its system to the case number from the proactive match record. If the
other state case number in the receiving state's case matched the case
number from the proactive match record, then both states would know they
had an interstate case that matched exactly. If the other state case
number in the receiving state's case did not match the case number from
the proactive match record, but the case participants matched exactly,
then the receiving state could decide to automatically update the other
state case number in their system with the case number from the
proactive match record.

Problems arise with an expanded FCR matching approach because the FCR
does not currently maintain any interstate data. The first problem would
occur when the participants from two cases in different states matched
exactly, but one or both of the cases were not interstate cases. The
most common example of this type of match would be a TANF arrears-only
case in state A matching with an ongoing current support case in state
B. Both cases would share the exact same participants. Because the FCR
does not currently maintain any interstate data, the expanded FCR
matching program would be unable to determine if an interstate
relationship existed between the two states. It would report this match
as an exact match to each state, leaving it up to those states to
determine if an interstate relationship actually existed. This would
greatly diminish the states' ability to automatically update the other
state case number based on a high degree of confidence that the matched
cases are *interstate* cases.

Consequently, the lack of interstate data in the FCR would promote the
unnecessary reconciliation of cases that were not interstate cases. The
burden would be placed on state staff to determine the nature of the
relationship between the two cases. This would add to the already
formidable task of processing reconciliation results and would not
likely be well received by the states.

The lack of interstate data in the FCR also would make it impossible to
identify interstate case mismatches. If a state presumed that it had a
case in common with another state, but the other state had never
initiated a corresponding interstate case, matching within the FCR would
not identify the problem. Because the FCR does not maintain any
interstate data, the expanded FCR matching program would have no way of
knowing that state A presumed that it had a case in common with state B.

An expanded FCR matching approach partially addresses the issue of
closed cases through matching against the FCR closed case file. However,
cases closed by states prior to initial loads onto the FCR in 1998 are
not resident in the FCR, since closed cases were specifically excluded
from the initial loads. There are potentially a large number of
interstate closed cases that should be included in a national ICR effort
that would be missed for this reason.

Matching records through the FCR would not require any up-front work
from the states to support the matching process; and, since OCSE has
control over the FCR databases, this approach would simplify the
scheduling and coordination of a national reconciliation. However, a
potential problem may exist with the current proactive match record
format and whether it could be modified to clearly define the extent to
which cases matched and the nature and type of data discrepancies
between two cases.

Reconciliation results should be defined to a level that the category of
a match or a data discrepancy clearly suggests the next appropriate
action that should be taken by a reconciliation worker. The existing
proactive match record has a limited amount of filler that could be used
for this purpose. If filler could be used, programming changes would
need to be made at both the federal and state levels. Since these
changes would constitute a "major impact change" to the FCR, a requisite
seven-month notification period would need to be given to states to
prepare for the changes. Delays of this nature could place a national
reconciliation effort in competition with other national initiatives.

Finally, an expanded FCR matching approach may not include the full
population of interstate cases. Cases that were never sent to the FCR by
states, or were rejected by the FCR, because they failed to meet minimum
case/participant data criteria would be excluded from the match process.
The potential number of interstate cases that would be missed in an
expanded FCR-based reconciliation attempt is difficult to estimate.
However, this limitation does run counter to the opinion expressed by a
majority of states that any national reconciliation should include as
many interstate cases as possible.

Based on the above concerns, an expanded FCR matching approach would not
resolve all of the critical synchronization problems identified by the
states. The overriding factor in this evaluation is the lack of
interstate data in the FCR and the inability of the matching routine to
identify the existence of either a true interstate relationship or of a
presumed interstate relationship. This lack of interstate data within
the FCR significantly degrades the benefits of automatically updating
other state case numbers and resolving case mismatches that should flow
from a recommended ICR approach.

### 3.5.4 [Conclusion Drawn on Evaluation of Alternatives]{.underline}

While each of the alternative approaches offered valuable lessons for a
national ICR approach, none met the criteria established with the
states. Given all factors, the recommended approach is ICR Extract File
Matching. Section 4 provides a cost/benefit analysis for proceeding with
a national ICR. Section 5 provides a risk assessment and mitigation plan
for this approach.

# 

# SECTION 4

######## NATIONAL ICR COST/BENEFIT ANALYSIS

The benefits and cost savings of a national ICR can be measured by how
well it helps states address the problem of unsynchronized interstate
cases, and how well the ICR program overcomes problems inherent in
current reconciliation methods.

## 4.1 State Costs for a National ICR Program

Based on anecdotal information obtained through conference calls with
state and ACF Regional Office representatives and their estimates of the
time required to develop programs for a national ICR using Extract File
Matching, some of the costs associated with the process are provided
below.

-   The cost to states to develop an extract file ranges from \$1,040 to
    \$6,000, based on a 1-2 week development time. The lower figure
    (\$1,040) is based on a state programmer annual salary of \$50K,
    divided by 1920 hours x 40 (one week). The higher figure (\$6,000)
    is based on a contractor employee hourly rate of \$75 x 80 hours
    (two weeks)

-   The cost to states to develop a program to automatically update
    their systems with matched data or to generate transactions or
    documents to obtain additional information from other states, ranges
    from \$2,080 to \$9,000, based on a 2-3 week development time. The
    lower figure (\$2,080) is based on a state programmer annual salary
    of \$50K, divided by 1920 hours x 80 (two weeks). The higher figure
    (\$9,000) is based on a contractor employee hourly rate of \$75 x
    120 hours (three weeks)

-   The cost to states to manually reconcile those cases that cannot be
    reconciled through automated means cannot be reliably gauged, and,
    therefore, this cost cannot be assigned. Factors contributable to
    this inability to estimate the cost to the state for this phase
    include: the extent of unreconciled cases; the varying level of
    interstate caseloads from one state to another; past reconciliations
    performed by a state; and the efficacy of both the program developed
    to automatically update the state system and the procedures the
    state already has in place to reconcile mismatched cases.

Ameliorative measures to reduce the burden on states for manual
reconciliation are part of the ICR program, and include training,
technical assistance, and maintenance of a \"best practices\"
clearinghouse for state staff to share knowledge with one another.

Also, an analysis of a recent reconciliation between **Montana** and
**North Dakota** drew an encouraging conclusion regarding the use of the
Extract File Matching process to greatly reduce the need for manual
reconciliation of mismatched cases. The results of the **Montana-North
Dakota** reconciliation showed that 53 percent of the interstate cases
had errors that precluded automated updates of **North Dakota**'s system
under current reconciliation conditions. Of a total of 514 cases, 270
(53 percent) of these were in error: 232 had incorrect case numbers; 34
had a closed case in **Montana** carried as open; and four no longer
required the services of **Montana**. Of the 270 cases in error, 47 also
had incorrect names in the responding state\'s cases.

  -----------------------------------------------------------------------
  An analysis of the Montana-North Dakota reconciliation by North Dakota
  staff determined that, using the Extract File Matching approach; all of
  the 270 cases with errors could have been corrected immediately or
  reconciled through automated means.

  -----------------------------------------------------------------------

These costs are most severe for large states that use a manual process
to reconcile. However, even states with highly automated reconciliation
procedures cite the labor involved in reconciling exceptions and
discrepancies as their most significant cost.

Staff from **Pennsylvania**, a state that automated its reconciliation
procedures, estimates that it takes six weeks or more to complete a full
reconciliation with a single state. This includes time spent by central
office staff in planning, scheduling and coordinating the
reconciliation, as well as the time spent by numerous field staff in
reconciling the exceptions and discrepancies identified by the
reconciliation. This effort represents a substantial expenditure of
staff hours on **Pennsylvania**'s part. All states currently conducting
reconciliations incur these costs to a greater or lesser extent based on
the size of their interstate caseloads and their level of automation.

A national ICR using the Extract File Matching process would minimize
the costs currently incurred by states in scheduling and coordinating
the exchange of files with other states. OCSE would assume
responsibility for scheduling and coordinating a national ICR and
establishing standards to govern the reconciliation. The states would
only have to interact with OCSE to submit their caseload for matching
and to receive the results of that matching process, rather than having
to interact with 53 other child support jurisdictions. Moreover, the lag
time built into the two-way exchange of data between individual states
would be eliminated, since a national approach would return results to
the states in a timely fashion. Consequently, the costs currently
incurred by states in performing individual state-to-state
reconciliations would be reduced by a national ICR.

Representatives from **Texas** and **Pennsylvania**, two states that
have completed a large number of full individual state-to-state
reconciliations, also expressed the concern that a national
reconciliation would cause them to revisit cases that had already been
reconciled. Incurring costs twice to reconcile the same case is not
acceptable to them. The extent to which the Extract File Matching
process addresses this concern is a key factor in state acceptance of a
national ICR. An analysis of this concern drew the following conclusion,
which was conveyed to representatives of both states: if a state had
reconciled in the past, those cases would indeed appear as interstate
cases in a subsequent reconciliation. However, the cases would be
\"perfect\" matches (unless they had subsequently gone out of sync) and
would need no manual intervention.

OCSE has committed to providing training and technical assistance to
states participating in a national ICR. The value of this assistance in
reducing the cost of processing reconciliation compares favorably to
OCSE's experience with the implementation of the expanded Federal Parent
Locator Service (FPLS). The technical assistance provided by OCSE to
states was critical to the successful establishment of both the NDNH and
the FCR. Such assistance would prove equally important in ensuring the
success of a national ICR.

## 4.2 State Cost Savings and Benefits of a National ICR

Processing reconciliation results is the costliest component of a
completed reconciliation. It is this cost that states perceive to be the
biggest barrier to their participation in a national ICR. A key factor
in the analysis of proposed national ICR approaches was the extent to
which each approach mitigates this cost for states. Promoting the
automatic update of other state case numbers and identifying open/closed
case discrepancies are critical factors in minimizing reconciliation
costs. As Mark Mintzer of **Washington** commented in a conference call
***"Even if the program only addressed closed cases and the right case
numbers, that alone would save hundreds of man-hours."***

  -----------------------------------------------------------------------
  It is estimated that correcting the other state case number through the
  ICR program could save \$17.5 million nationwide, which equates to 438
  FTEs that could be devoted to other, more productive tasks. (This is
  based on: a nationwide caseload of 17 million, OCSE estimates of 11
  percent of cases as interstate cases, states' estimate of 30 percent of
  interstate cases containing incorrect or missing case numbers, a \$40K
  national average caseworker salary (plus benefits), and 3 caseworker
  transactions/case/year at 30 minutes per transaction.

  -----------------------------------------------------------------------

The most significant benefits reported by state representatives through
the establishment of a correct baseline of other state case numbers were
to:

-   Resolve open/closed case discrepancies and case mismatches

-   Improve EFT processing

-   Improve CSENet processing

-   Improve communication among states.

The analyses of these four benefits are discussed below.

### 4.2.1 [Resolve Open/Closed Case Discrepancies and Case Mismatches]{.underline}

Case status discrepancies and case mismatches constitute a severe
impediment to efficient interstate case processing, affecting a majority
of states that undertake state-to-state reconciliations. Providing
states with the data required to close unnecessary interstate cases and
re-initiate needed interstate actions is a major benefit of a national
ICR. An example from **Texas** indicates the scope of this problem.

In a reconciliation between **Texas** and **Virginia**, **Texas** staff
identified 2,700 cases they presumed they had in common with
**Virginia**, for which **Virginia** did not have a corresponding open
case on its system. Upon reconciling these exceptions, **Texas** staff
discovered that they were able to close 600 of these cases on their
system.

This example illustrates the inefficiencies of unreconciled interstate
cases. Caseworkers spend time attempting to process open cases in their
state that are closed or have never been opened in the other state. A
national ICR based on the Extract File Matching approach will identify
the interstate cases that no longer require any action from the state.

Reconciling these discrepancies allows state staff to focus on those
interstate cases that truly require action, and gives caseworkers the
opportunity to revisit whether a case needs to be an interstate case or
whether a one-state action may be more effective in serving their
client. States also should realize benefits from more accuracy in
incentive calculations.

### 4.2.2 [Improve Electronic Funds Transfer (EFT) Processing]{.underline}

The establishment of correct other state case numbers is a requirement
for effective nationwide use of interstate EFT. However, of the 2,862
state-to-state reconciliations that would be required to reconcile the
national interstate caseload based on a calculation of each of the 54
states needing to reconcile with the other 53 states (54 x 53 = 2,862),
only 891 have been completed as of February 14, 2003. A national ICR
that provides states with the ability to automatically update other
state case numbers in their systems would establish a baseline of
correct other state case numbers. This baseline would provide
substantial, direct benefits to the states when EFT alone is considered.

Of the 45 states that have performed reconciliations, representatives
from 27 states cited improved EFT processing as a major benefit
associated with completing individual state-to-state reconciliations.
Representatives from several states, **Arizona** and **New Jersey**
among them, mentioned that their EFT error rates fell to less than 1
percent for states with which they had reconciled; **Ohio** also noted a
dramatic reduction in error rates.

EFT is widely recognized as the most cost-effective means for states to
process outgoing and incoming interstate collections. States receive
significant cost savings when they implement EFT instead of generating
and mailing outgoing paper checks, and processing batches of incoming
paper checks. A clear example of EFT savings concerning outgoing checks
was provided by **Montana**.

  -----------------------------------------------------------------------
  With an interstate responding caseload of 5,000 (12 percent of its
  entire caseload), **Montana saves \$45K per year as a result of
  reconciling with 34 states for outgoing EFT purposes.** The state
  averages 345 EFT transactions to other states per day at savings of
  fifty cents per transaction. This is approximately 80 percent of the
  potential savings in outgoing EFT transactions since Montana has not
  yet reconciled for EFT purposes with 20 states. And for incoming EFT
  transactions, Montana was able to save **1.5 FTEs**. **This represents
  staff members that formerly processed payments manually and are now
  assigned to other activities.**

  -----------------------------------------------------------------------

**Montana** staff stated that their state disbursement unit saved "huge
amounts\" of man-hours for every state that agreed to exchange
interstate collections via EFT. The labor savings included the
elimination of physical controls that have to be imposed on batches of
paper checks and the implementation of automated posting of EFT amounts
by the system, thus preventing human posting errors that cost
significant man-hours to correct after checks have been released.

Transmitting an incorrect other state case number is one of the most
common EFT errors. Such errors can be costly, since they require
interaction between staff from both states to correct. This is one
reason that many states do not implement EFT with another state until
the states have reconciled their interstate cases with each other.

### 4.2.3 [Improve CSENet Processing]{.underline}

A correct baseline of other state case numbers would provide states with
a much more efficient use of resources as a direct result of their
ability to fully utilize the automated capabilities of CSENet.

The CSENet network was established to provide states with a means to
effectively exchange interstate data with each other. CSENet
incorporates many automated features that were designed to interface
with state child support systems and minimize the amount of manual
caseworker intervention required to process interstate requests. As with
EFT, the benefits derived from use of CSENet's automated features are
significantly degraded by the transmission of incorrect other state case
numbers in CSENet transactions. Most state systems validate the other
state case number included on incoming CSENet transactions. If the other
state case number is incorrect or missing, the resulting error has to be
resolved by a caseworker before the state system can initiate the next
appropriate action associated with that CSENet transaction. The cost of
resolving these errors reduces the savings realized from a successful
state system interface with CSENet.

Representatives from 17 of the 45 states that have performed
state-to-state reconciliations cited improved CSENet processing as a
major benefit. While no one was able to provide quantifiable savings
associated with more efficient use of CSENet, a **Texas** representative
mentioned a significant reduction in interstate paperwork that allowed
the state to reassign workers previously dedicated to processing that
paperwork. He directly attributed this reduction in paperwork to
improved state system processing of CSENet transactions resulting from
the 39 state-to-state reconciliations they had completed as of December
2002. A representative from **Georgia** noted that CSENet transactions
work much smoother after reconciling with another state.

### 4.2.4 [Improve Communication Among States]{.underline}

Another benefit associated with correct other state case numbers is
improved communication between states and a more efficient use of staff
time. While this benefit is less tangible than the cost savings
associated with EFT and CSENet, many state staff felt it was
significant. Being able to provide another state with the correct case
number for the corresponding case in their system (whether through a
phone call, e-mail or UIFSA document) is the most basic requirement for
effective interstate communication. Representatives from **Georgia** and
**Illinois** cited better communication as an important benefit of their
reconciliation efforts. Because interstate cases require coordination
between staff in two states, any improvement in the communication of
requests and data between those workers will have a positive impact on
the processing of interstate cases. As states move towards offering web
access to case data resident on state systems, the use of the correct
case number will become a key issue.

## 4.3 OCSE Benefits of a National ICR

State representatives made it clear that they have experienced
substantial benefits from completing individual state-to-state
reconciliations. These benefits become even more significant when
realized on a national scale. As shown in the previous sections, a
national ICR program, using the Extract File Matching approach, could
generate substantial savings and produce significant benefits for the
states. However, there are real and tangible national benefits that
could accrue to OCSE as well:

-   **Federal-State Cooperation**. A successful ICR program, with
    oversight from OCSE, could be seen as a significant example of a
    federal-state partnership. Unlike previous ICR initiatives, the
    current approach, with interstate case matching to be performed at
    the federal level, has been designed to minimize the workload impact
    on the states. The Extract File Matching approach, with its
    centralized design and emphasis on ongoing assistance, should be
    seen as a joint venture *with* the states rather than a mandate *to*
    the states **Reliable Statistical Reporting**. A successful ICR
    program will provide a better estimate of the national interstate
    caseload. The cost/benefit analysis of this document was hampered by
    a lack of hard figures defining the extent of the interstate
    caseload for each state as well as nationwide. An important
    component of the ICR program is that it will now provide more
    reliable statistics for econometric purposes.

-   **Additional Collections.** A successful national ICR will improve
    the efficiency and effectiveness of state child support programs,
    improving the states' ability to collect more money for and provide
    more accurate counts of cases. This, in turn, will improve incentive
    measures for each state and improve data reliability at a national
    level, to the benefit of children and families.

# 

# SECTION 5

# RISK ASSESSMENT AND MITIGATION PLAN

Risk management uses systematic processes to anticipate program problems
and provide insight into possible consequences of change. An analysis of
potential problems, along with the probabilities and impacts, enables
managers to take necessary action to mitigate the potential negative
effects of change. Possible risks in performing a national ICR are
identified below. Contributing factors were analyzed and the probability
of each risk factor occurring is shown as well as the action items that
would help mitigate each risk.

Figure 5 Risk, Probability, and Mitigation Factors for a National ICR

+----------------------+-------------------+---------------------------+
| ##                   | **Probability**   | **Mitigation**            |
|                      |                   |                           |
| ## Risks             |                   |                           |
+======================+===================+===========================+
| States may submit    | > Medium/         | Notify states that their  |
| defective,           | >                 | extract files must be     |
| incomplete and       | > High            | fully tested and          |
| untested files for   |                   | verified. Provide         |
| the extract file     |                   | programs to perform edits |
| match. Time          |                   | within the states before  |
| constraints limit    |                   | submission for the        |
| the ability of       |                   | extract file match.       |
| states to correct    |                   |                           |
| problems.            |                   |                           |
+----------------------+-------------------+---------------------------+
| Due to state budget  | > Medium          | ICR technical lead can    |
| constraints, it is   |                   | provide skeleton code and |
| possible that some   |                   | assist states with this   |
| states will be       |                   | task. Also, an 'extract'  |
| unable to provide    |                   | file from the FCR can be  |
| resources for        |                   | used for those states     |
| programming of the   |                   | that are unable to        |
| initial extract      |                   | participate.              |
| file.                |                   |                           |
+----------------------+-------------------+---------------------------+
| Due to budget        | > Medium          | An 'extract' file derived |
| constraints and      |                   | from the FCR will be used |
| overlapping          |                   | for those states unable   |
| priorities, more     |                   | to participate.           |
| than the anticipated |                   |                           |
| number of states may |                   |                           |
| be unable to         |                   |                           |
| participate in a     |                   |                           |
| national ICR.        |                   |                           |
+----------------------+-------------------+---------------------------+
| Due to budget        | > Medium          | Provide programs to print |
| constraints and      |                   | responses for manual      |
| overlapping          |                   | reconciliation, if        |
| priorities, states   |                   | needed.                   |
| may not have the     |                   |                           |
| resources to change  |                   |                           |
| their systems to     |                   |                           |
| automatically        |                   |                           |
| process the returned |                   |                           |
| files.               |                   |                           |
+----------------------+-------------------+---------------------------+
| Timing of the state  | > Medium          | Once a decision to        |
| participation in the |                   | proceed is reached, the   |
| ICR could overlap    |                   | ICR effort must proceed   |
| with other federal   |                   | with an aggressive        |
| initiatives.         |                   | schedule while allowing   |
|                      |                   | states sufficient time to |
|                      |                   | complete necessary        |
|                      |                   | programming.              |
+----------------------+-------------------+---------------------------+
| States may not have  | > Medium          | Provide training and a    |
| the resources to     |                   | "best practices" guide to |
| process those cases  |                   | assist states with return |
| that require manual  |                   | file data.                |
| intervention.        |                   |                           |
+----------------------+-------------------+---------------------------+
| The majority of the  | > Low             | Provide updated           |
| states agreed that a |                   | information to state      |
| national ICR would   |                   | decision makers about the |
| be beneficial.       |                   | benefits of the national  |
| However, conference  |                   | ICR.                      |
| call participants    |                   |                           |
| were not necessarily |                   |                           |
| state                |                   |                           |
| decision-makers.     |                   |                           |
+----------------------+-------------------+---------------------------+
| Disagreement among   | > Low             | Use state input in        |
| state                |                   | finalized extract file    |
| representatives on   |                   | layout and secure         |
| the required extract |                   | agreement by              |
| data elements.       |                   | demonstrating the value   |
|                      |                   | of the required data      |
|                      |                   | elements.                 |
+----------------------+-------------------+---------------------------+
| Non-timely           | > Low             | Obtain buy-in with        |
| submission of        |                   | participating states to   |
| extract files from   |                   | adhere to timetable for   |
| states.              |                   | extract file submission   |
|                      |                   | through continued         |
|                      |                   | discussions on conference |
|                      |                   | calls, at conferences,    |
|                      |                   | and with assistance of    |
|                      |                   | ACF Regional Office       |
|                      |                   | staff. Also, provide      |
|                      |                   | technical assistance to   |
|                      |                   | states, as needed.        |
+----------------------+-------------------+---------------------------+

# 

# SECTION 6

# BUSINESS CASE CONCLUSION

This Business Case has presented a recommendation for OCSE to proceed
with a national reconciliation of interstate caseloads using **ICR
Extract File Matching**. Based on extensive state input, it is evident
that a national ICR would provide direct benefits to the states in
helping to improve service to the significant constituency of child
support clients whose cases involve the cooperation of, and maintenance
by, more than one state. The recommended approach of Extract File
Matching overcomes many of the barriers that have impeded previous
state-to-state reconciliation efforts and addresses concerns expressed
by states regarding interstate case synchronization.

To reiterate what was presented in the Executive Summary, the
overarching goals of a national ICR using the Extract File Matching
approach are to:

-   Improve service to families with interstate cases,

-   Improve electronic communication among states,

-   Establish accurate state and national interstate case baselines, and

-   Establish clear accountability for interstate case processing.

Calls were made with the assistance of the ACF Regional Offices to 52 of
the states, with written input received from a 53^rd^ state, to help
document the reasons interstate cases become unsynchronized and problems
experienced through previous state-to-state reconciliation efforts.
State and ACF Regional Office input helped determine the evaluation
criteria that should be applied to possible alternatives to performing a
national ICR. Based on the application of these criteria, ICR Extract
File Matching was selected as the best approach.

This document presented a detailed description of ICR Extract File
Matching, with an analysis of how this approach met the criteria
established for evaluation purposes. The level of interest in
participating in a national ICR using this approach was presented (***48
states***) as well as the enthusiasm supporting this approach among the
states (***44 states** selected this approach as the most desirable
approach*).

## 6.1 Document Structure

This document was structured to help present the material necessary for
OCSE to make an informed decision as to proceeding with a national ICR.

-   **Section 1** presented **State Case Reconciliation Problems**

-   **Section 2** presented **Problems Encountered with Current
    Reconciliation Methods**

-   **Section 3** presented the **ICR Technical Approach**. This section
    presented ICR Extract File Matching and the reasons why this
    approach was selected as the recommended approach for a national
    ICR. The evaluation criteria developed with state and ACF Regional
    office staff input, and the anticipated buy-in of states for this
    recommended approach, were provided. Additionally, this section
    presented three alternative approaches to ICR Extract File Matching
    that were considered, but not selected, after analysis against the
    evaluation criteria

-   **Section 4** presented a **National ICR Cost/Benefit Analysis**
    based on the Extract File Matching approach

-   **Section 5** presented a **Risk Assessment and Mitigation Plan** of
    those factors that could influence the success of a national ICR
    utilizing the Extract File Matching approach.

## 6.2 Pilot Feasibility 

The need for an ICR demonstration pilot, as well as the feasibility of
conducting one, were analyzed during a two-week period and discussed at
the OCSE FCR/ICR meeting on February 10, 2003.

During the ICR conference calls, several states expressed interest in a
pilot study as a vehicle for small-scale testing of the nationwide ICR
concept.

-   **South Dakota, North Dakota** and **Colorado** staff volunteered to
    participate in a pilot study of ICR Extract File Matching, if OCSE
    decided to conduct a pilot.

-   **Virginia** staff said they would prefer to see a pilot of the ICR
    undertaken before they committed their resources to a national ICR.

-   **Nebraska** staff spoke about the value of conducting a pilot
    before initiating a national ICR.

Given the level of interest, the OCSE FCR/ICR workgroup discussed the
following issues:

-   Form of Pilot Study. The FCR/ICR workgroup discussed what form the
    pilot would take -- a two-state pilot of the expanded FCR matching
    approach, or a two-state pilot of Extract File Matching. Also
    discussed was a dual pilot, using both approaches, in order to
    compare results and gauge the effectiveness of each approach

-   Project Delay. The FCR/ICR workgroup discussed scheduling and
    expressed concern that a pilot might delay a national ICR and force
    the effort into direct competition with new initiatives that might
    be legislated later this year

-   Cost/Benefit Implications. The role of a pilot in providing ICR
    cost/benefit data was discussed.

-   Value of a Pilot as a "Selling Point." The workgroup discussed
    whether a pilot would persuade those states to participate in a
    national ICR that would otherwise not participate.

The Project Officer articulated the following conclusions reached by the
FCR/ICR workgroup:

-   The benefits of conducting a pilot are outweighed by the potential
    for delaying a national ICR

-   State staff have already expressed a significant level of interest
    in pursuing a national ICR. Given this level of interest, it is
    doubtful that a pilot would increase the number of states willing to
    participate in a national ICR

-   States may be dissuaded from participating in a national ICR due to
    the time loss caused by a pilot

-   Time demands on the states will only increase if Congress passes new
    initiatives.

-   Delays in implementing a national ICR could result in increased
    schedule conflicts for the states.

Therefore, the workgroup tabled further discussion of a pilot ICR study,
and a pilot is not currently under active consideration as part of the
ICR project.

## 6.3 Next Steps

The next steps to be taken include:

-   Obtain a decision by OCSE as to whether a national ICR effort should
    proceed using the Extract File Matching approach as documented
    herein

-   Present the recommended approach to the ACF Regional Offices and to
    the states. The participation of ACF Regional Offices will be
    critical in helping to maintain communication with the state
    stakeholders. Continued interaction with workgroups, especially the
    Big 10 + 1, also will be instrumental in fostering successful
    implementation of a national ICR

-   Lock in state participation though presentations at conferences (for
    example, a national ICR will be discussed at the ERICSA and NCSEA
    conferences) and direct communication with state and ACF Regional
    Office staff

-   Schedule the implementation of a national ICR effort utilizing
    Extract File Matching. Adherence to deadlines and milestones will be
    critical for the success of this effort

-   Initiate training and technical support to the states. State staff
    have come to expect a high level of support from OCSE, as provided
    through earlier implementation efforts involving the FCR and NDNH.
    State participants on the ICR conference calls expressed on numerous
    occasions that they would appreciate the leadership and guidance of
    OCSE in the implementation of this effort to address the
    reconciliation of interstate cases on a national level.

[^1]: An FCR-derived 'extract\' might not include all of the closed
    interstate cases that should be considered in an ICR.