HHS, CMS improper payments: $88.5B in 2024

Improper payments made through programs of the Health and Human Services Department, which ballooned during the COVID-19 pandemic, are on the decline but still amounted to more than 5% of outlays by the agency last year — or about $88.5 billion.

Elon Musk's team at the Department of Govenment Efficiency has reportedly been combing through systems at federal agencies, including the Centers for Medicare and Medicaid Services, looking for fraud.

Improper payments from federal programs can include payment errors or fraudulent payments but most often involve insufficient or missing documentation in reporting by states, providers or contractors according to a CMS fact sheet. A 2009 presidential executive order directed all payments to program beneficiaries or other entities be examined for problems.

In 2021, during the pandemic, improper payments for all HHS programs totaled almost 13% of the agency's spending. By 2024, that percentage had dropped to 5.6%.

Among the programs under HHS, improper payments in Medicaid and Medicare Advantage have decreased since 2021 but problem payments in Medicare fee-for-service have increased. Improper payments in the Medicare prescription drug benefit program have seen a small increase since 2022.

A 2019 report from the Government Accountability Office said most payment errors in Medicare involved durable medical equipment, laboratories and home health services. It also recommended Medicaid reviews do a better job of identifying the cause of improper payments so they can be corrected.