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HHS squandered $106.7 billion on improper payments in 2019

The agency has identified only 13.2% of those funds as available for recovery.

Updated: November 29, 2020 - 7:12am

The Facts Inside Our Reporter’s Notebook

The Golden Horseshoe is a weekly designation from Just the News intended to highlight egregious examples of wasteful taxpayer spending by the government. The award is named for the horseshoe-shaped toilet seats for military airplanes that cost the Pentagon a whopping $640 each back in the 1980s. 

This week, our award goes to the Department of Health and Human Services (HHS) for spending $106.7 billion on improper payments during 2019.

Improper payments are defined under federal law as "payments made by the government to the wrong person, in the wrong amount, or for the wrong reason."

Health and Human Services is the massive government agency that is responsible for, among other things, the administration of the Medicaid and Medicare healthcare programs. Incidentally, those programs are where the vast majority of agency waste occurs.

According to a new report from Open the Books, improper payments from the Medicaid and Medicare programs have increased significantly in the past decade, in part due to the implementation of the Affordable Care Act — also called Obamacare. In 2011, when the act was signed into law, Congress declared it would help pay for the expensive plan by rooting out waste, fraud and corrupt spending within the Medicare and Medicaid sections of the agency.

Health and Human Services is the leading source of improper payments in the entire U.S. government, dwarfing by a magnitude of multiples the second-worst offender, which in 2019 was the Department of Treasury.

The offices of Medicare and Medicaid (in addition to the Earned Income Tax Credit) are responsible for, according to the report, more than two thirds of the improper payments that occur within the government every year. The Centers for Medicare and Medicaid Services is often found to have doled out government benefits and payments to Americans who are long dead or not who they say they are.

Once the taxpayer money is mistakenly spent, it is very hard for the government to claw it back. Of the $106.7 billion HHS squandered on improper payments in fiscal year 2019, it has been able to identify for recovery only $14.1 billion, or about 13.2% of the total. Of that $14.1 billion, the department has been able to "recapture" about $12.1 billion. 

Both Presidents Barack Obama and Donald Trump emphasized the importance of preventing improper payments from occurring with such frequency in the core programs of the federal government. Obama went so far as to sign an executive order to eliminate them in 2009, prior to Obamacare's passage. President Trump specifically noted the issue in the budget he sent to Congress for FY 2021.