HI HB2186

Establishes procedures for state agencies to identify, estimate, and recover improper payments made to non-state entities, including overpayments, underpayments, duplicate payments, and payments for ineligible recipients or services.

Requires each agency head to periodically review programs susceptible to significant improper payments during fiscal year 2010-2011 and at least once every three fiscal years thereafter, considering risk factors such as program complexity, payment volume, and recent funding changes.

Mandates agencies to estimate improper payments for identified programs and provide reports on reduction actions, required resources, and accountability measures for managers and programs.

Directs agencies to conduct recovery audits on programs expending specified amounts annually if cost-effective, with priority given to recent payments and programs susceptible to significant improper payments.

Requires the Director of Finance to prescribe guidance by December 31, 2010, and submit annual reports to the governor and legislature on agency compliance, improper payments, and recovery actions; recovered amounts may be retained by agencies (up to 25 percent) for financial management improvements or credited to original appropriations.