Medicaid is on course to pay more than $1 trillion in improper payments over the coming 10 years, warned an expert.
Multiple federal agencies wasted $162 billion in government funds by making improper payments during fiscal year 2024, with the Medicare program at the top, according to a recent report from the U.S. Government Accountability Office (GAO).
The money was spent by 16 agencies and across 68 programs, the agency said in the March 11 report.
“Improper payments—those that shouldn’t have been made or were made in the incorrect amount—have been a government-wide issue for more than 20 years,” GAO said.
Five government programs accounted for roughly 75 percent of the improper spending.
Medicare topped the list with $54.3 billion. This was followed by Medicaid, the Earned Income Tax Credit, the Supplemental Nutrition Assistance Program, and the Restaurant Revitalization Fund.
“Eighteen federal programs reported improper payment rate estimates of at least 10 percent, including six programs whose rates ranged from over 25 percent to about 45 percent,” said the report.
Out of the $162 billion in improper payments, $135 billion (approximately 84 percent) were overpayments, GAO noted.
The remaining comprised underpayments, unknown payments, and technically improper payments. These refer to funds sent to recipients who were entitled to such receipts but the payment process did not follow the regulations.
Compared to fiscal year 2023, improper payments $74 billion lower in fiscal 2024.
“Agencies that reported substantial decreases attributed the declines to factors such as terminating or winding down certain programs,” GAO said.
“These include programs specific to the COVID-19 pandemic and programs for which agencies had temporary review flexibilities during the public health emergency (e.g., Medicaid).”
The report follows a hearing by the House Subcommittee on Delivering on Government Efficiency on Feb. 12 in which several experts warned about the improper payment issue plaguing the government.
Haywood Talcove, CEO of LexisNexis Risk Solutions for Government, said federal agencies have reported around $2.7 trillion in total improper payments since 2003, which is “a staggering figure that underscores the persistent vulnerabilities across government programs.”
