Wednesday, March 11, 2020

The Federal Government Issued $175 BILLION In ‘improper payments’ In 2019

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Imagine taking $175 billion in cash and flushing it down the toilet. Well, that is what our federal government did last year, according to a new survey from the government’s watchdog.
Every year, the Government Accountability Office (GAO) tracks the amount of improper payments made by various federal agencies and programs in the form of waste, fraud, and abuse. The audit does not subjectively judge whether a program itself is wasteful, but whether, based on the program’s own guidelines, there are payments made that should not be. For fiscal year 2019, the GAO found that the federal government made $175 billion in improper payments, a 15 percent jump from FY 2018.
While we will never tackle the federal deficit crisis by combating waste and fraud alone, these numbers do add up. $175 billion is roughly the cost of the entire annual budget for the gargantuan federal civilian and military retirement pension program. According to the GAO, the federal government has wasted $1.7 trillion on improper payments alone since 2003. That’s when Congress began requiring this annual audit.
Here are some other key takeaways from the report, which was published yesterday.
  • Roughly $121 billion (69 percent) of the waste was concentrated in just three programs: Medicaid ($57.4 billion), Medicare ($46.2 billion), and Earned Income Tax Credit (EITC) ($17.4 billion). In other words, Medicaid accounted for more waste than all of the other government programs (aside from Medicare and EITC) combined. This is another reason why it would be better to convert Medicaid into a direct subsidy to those in need, much like food stamps, rather than funneling it through corrupt managed care. The rate of improper payments for Medicaid accounts for a whopping 13.5 percent of the entire cost of the program, as compared to a 6 percent improper payment rate for the food stamp program. The same principle applies to the Children’s Health Insurance Program (CHIP), which is also funneled through the managed care cartel and racked up improper payments ($2.7 billion) composing 15 percent of the program’s budget. 
  • Roughly $38 billion of the total amount of improper payments resulted from the agency not being able to authenticate eligibility criteria. Think about what could be done with such a sum of money if we merely clamped down on eligibility standards. 
Read the rest from Daniel Horowitz HERE.

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