08 Oct $77.4 Billion in Improper Medicaid & Medicare Payments – 2014
A GAO report uncovered data that the government accumulated more than $124 billion in improper payments in 2014, $19 billion more than the year before. The Oct. 1 report uncovered that the outpouring in payments came almost entirely from Medicare and Medicaid, which account for the bulk of improper payments across the entire federal system.
“Federal spending in Medicare and Medicaid is expected to significantly increase, so it is critical that actions are taken to reduce improper payments in these programs,” the report states.
Payments made in error include things such as overpayments, underpayments or payments that should have been paid by a third party. The GAO estimates that ever since agencies started to report improper payments in 2003, $1 trillion in federal funding has been wasted.
U.S. Comptroller General Gene Dodaro testified in front of the Senate Committee on Finance on Oct. 1 to discuss the report’s findings along with GAO’s recommendations. Dodaro testified that “Reducing improper payments is critical to safeguarding federal funds and could help achieve cost savings and improve the government’s fiscal position.”
The report made mention that Medicaid and Medicare accounted for $77.4 billion in improper payments in 2014. To solve the problem, GAO recommended the Centers for Medicare and Medicaid improve Medicare automated audits, track post payment recovery audit activities, remove Social Security numbers from Medicare cards to help prevent fraud and other reforms. Finally, the GAO recommended refining efficiency and oversight for Medicaid, including cost avoiding payments that are the liability for third-party insurers. CMS agreed with the recommendations and, in some cases, was already working on implementation plans for them.