This Act may be cited as the Helping Encourage Lawful Payments and Strengthen Transparency, Anti-fraud, Tips, and Enforcement Strategies Act or the HELP STATES Act.

Section 1903(d)(3) of the Social Security Act (42 U.S.C. 1396b(d)(3)U.S. Code — Title 42, Section 1396b(d)(3)View official source on GovInfo) is amended by adding at the end the following new subparagraph: (C) (i) For quarters beginning on or after the date that is 18 months after the date of enactment of this subparagraph, in the case that a State recovers during such quarter any amounts which represent an overpayment made to a person or other entity due to fraud, the Secretary shall exclude up to 25 percent (as elected by the State) of the pro rata share of such amounts so recovered to which the United States is equitably entitled, as determined for purposes of subparagraph (A), from the amount of overpayment to be adjusted under this subsection. (ii) With respect to any amounts so excluded from the amount of overpayment to be adjusted under this subsection pursuant to clause (i), a State— (I) shall use such amounts for activities related to program integrity, which may include audits, investigations, data analysis, investment in information technology systems that improve the detection, prevention, or recovery of improper payments, and other activities associated with the detection of fraud and the recovery of improper payments; and (II) not less frequently than annually, shall report to the Secretary (in a form and manner specified by the Secretary) how the State used such amounts..