Waste of the Day: Medicaid and Medicare Remain Biggest Culprits for Improper Payments

US

This story originally was published by Real Clear Wire

By Adam Andrzejewski
Real Clear Wire

Topline: The federal government spent $236 billion on improper payments in 2023, according to a recent audit from the U.S. Government Accountability Office.

Medicaid and Medicare were responsible for $101.5 billion of the payments (43%). Auditors at OpenTheBooks have continuously warned about financial mismanagement at the two agencies, most recently publishing an oversight report in 2023.

Key facts: Improper payments are payments the government accidentally sends to the wrong person or for the wrong amount.

Last year, OpenTheBooks reported that the federal government had made $2.9 trillion in improper payments between 2004 and 2022, adjusted for inflation. The GAO’s new data brings the total well above $3 trillion. That’s more than 10% of America’s current GDP, all given away by mistake.

OpenTheBooks’ previous reports also found that Medicaid and Medicare improper payments have skyrocketed since totaling “only” $64 billion in 2012. The agencies’ 2023 total isn’t quite as high as in the two previous years, but it’s still $16 billion higher than in 2012, adjusted for inflation.

The third-worst program belonged to the Department of Labor, which sent $43.6 billion in improper payments for pandemic unemployment assistance.

Sixteen programs reported improper payment rates above 10%. Under federal law, those programs must submit a plan to Congress with steps to address the issue, since they are demonstrating poor “fraud risk management.”

Not every program estimated its improper payments, so the actual amount is likely even greater than $236 billion. Regardless, the figure is still higher than the total annual budget of any U.S. state besides California.

Critical quote: “We identified … the federal government’s inability to determine the full extent to which improper payments occur and reasonably assure that appropriate actions are taken to reduce them,” the GAO wrote in its report. “Until the federal government has implemented effective processes to determine the full extent to which improper payments occur … it will not have reasonable assurance that the use of federal funds is adequately safeguarded.”

Summary: Most national governments don’t see $236 billion total in an entire year. The U.S. government threw out that much by mistake.

The #WasteOfTheDay is brought to you by the forensic auditors at OpenTheBooks.com

This article was originally published by RealClearInvestigations and made available via RealClearWire.

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