BI Beat: When “Action Required” Isn’t Enough - The Behavioral Side of Overpayment Recovery

The BI Beat is a monthly newsletter column written by the Behavioral Insights team, featuring insights, practical examples and interviews from the field.

We are excited to announce a new resource for NASWA members, Using Behavioral Insights for Unemployment Insurance Overpayment Recovery: A Guide for State Workforce Agencies. A collaboration with Behavioral Insights, State Engagement, and students from the Master of Behavioral and Decision Sciences program at the University of Pennsylvania, the guide tackles the tricky issue of overpayment recovery. By considering frontline state realities and blending best practices in collections with behavioral science, it offers practical solutions to recover more overpaid dollars.

You’ve probably had to submit paperwork to keep something important in place, like maintaining a professional license, securing reimbursement, or finalizing a benefit tied to your job that requires some follow-up. A few days later, an email arrives with the subject line "Action Required." Inside are multiple links, a deadline, and a paragraph explaining the consequences if you don’t respond.

You open it between meetings. You understand it matters. Money is even involved. But it’s not obvious what to do first, so you flag it and plan to come back later. A reminder arrives the following week. Same structure. Same density. You still haven’t acted.

This isn’t avoidance (or at least not entirely). It’s a predictable response to complexity, timing, and competing demands.

Our new guide for overpayment recovery starts from a simple truth: repayment should be the easy choice, not just the required one.

Overpayments happen for many reasons. Regardless of cause, states are responsible for recovering funds, and claimants must repay. Sometimes what stands in the way isn’t unwillingness or inability. It is how people process information, perceive urgency, and decide what to do next when they’re under stress.

Behavioral barriers show up everywhere in recovery:

• People delay when the first step isn’t clear
• They disengage when messages feel overwhelming
• They procrastinate when consequences feel distant
• They freeze when too many options appear at once

None of these barriers signal disagreement with the obligation. They signal a system that isn’t aligned with how people actually behave.

Current overpayment recovery processes are often built around legal sufficiency, not behavioral response. Notices are accurate, options exist, and timelines are documented.

Yet, recovery stalls. Claimants don’t respond, miss important deadlines, and suffer the consequences. Meanwhile, agencies absorb costs through follow-ups, appeals, higher call volume, and delayed repayment.

Despite states’ persistence, communicating effectively about repayment remains difficult.

The guide reframes the question from “Are we communicating the requirement?” to “Are we designing for follow-through?” It maps out why recovery breaks down and how to design processes that prompt action earlier and more consistently.

Inside, you will find:

• A self-assessment checklist to identify where behavioral friction exists in recovery efforts,
• Clear explanations of behavioral principles that shape attention, motivation, and follow-through,
• Plug-in communication templates that sequence information and action,
• Design strategies that reduce overload, clarify choice, and increase urgency, and
• Tools that support repayment without changing policy or enforcement authority.

Rather than relying on a single tactic, the guide brings together behavioral principles that explain real-world responses, why people delay action, what draws attention, how defaults shape decisions, and how timing influences action, along with practical, customizable templates and solutions that you can use in your own agency.