Medicare, Medicaid are leaders in improper payments

Medicare and Medicaid are two of the top three government programs making improper payments, and several steps should be taken to reduce those amounts, the U.S. comptroller general said during a Senate hearing Thursday.

Estimated improper payments in fiscal 2014 totaled $124.7 billion across 124 federal programs. Nearly half of the improper payments were from Medicare and 14% were from Medicaid. The Earned Income Tax Credit made up 14.2%.

Comptroller General Gene Dodaro recommended that Medicare make wider use of automated prepayment checks, strengthen verification of providers and require surety bonds for some high-risk providers and suppliers.

In his opening remarks, Senate Finance Committee Chairman Orrin Hatch (R-Utah) noted that improper payments in 2014 were up about 20% from the previous year.

“When we talk about losing billions of dollars, it's not Washington's dollars that has been lost,” he said. “Instead, it is money that we've taken away from hard-working people and then squandered through improper oversight or plain old irresponsibility.”

A few Democratic senators, however, warned that conflating improper payments with fraudulent payments would not help solve either problem. As Dodaro put it, all fraudulent payments are improper but not all improper payments are fraudulent.

Improper payments also include payments for the wrong amount, duplicate payments and payments for non-eligible services or to non-eligible providers.



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