NCPA - National Center for Policy Analysis

Billions Involved In Improper Government Payments

November 8, 1999

The General Accounting Office has identified $19.1 billion worth of improper payments by just nine federal agencies during fiscal 1998. The GAO admitted that the full extent of the governments' improper payments is not known.

  • The payments were the equivalent of 7.1 percent of the $177 billion in Medicare benefit payments, 4.6 percent of an $18.6 billion rental assistance program, and 7 percent of the government's $20 billion food stamp program.
  • In some agencies, the GAO found substantial overpayments to individuals receiving federal benefits and overpayments to contractors for services and supplies.
  • Improper payments can be caused by fraud or simple clerical error, the GAO said.
  • Of the 24 largest cabinet departments, only nine reported estimates of overpayments -- and there is no overall requirement that they comply with such a request, according to Sen. Fred O. Thompson (R-Tenn.), chairman of the Senate Governmental Affairs Committee, who requested the study.

Source: Stephen Barr, "Improper Payments Cost U.S. Big," Washington Post, November 6, 1999.


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