NCPA - National Center for Policy Analysis

Government Made $106 Billion in Improper Payments

January 15, 2015

New figures indicate that the federal government made $106 billion in improper payments in 2013, on programs ranging from Medicare to Unemployment Insurance to the National School Lunch Program. A new report from Veronique de Rugy and Jason J. Fichtner of the Mercatus Center dives into the details of these improper payments:

  • The Office of Management and Budget labeled 13 federal programs as "high-error" programs.
  • The ones with the highest error rates included the Earned Income Tax Credit (with a 24 percent improper payment rate), the National School Lunch Program (15.7 percent error rate), Medicare Fee-for-Service (10.1 percent error rate), Medicare Advantage (9.5 percent error rate), Unemployment Insurance (9.3 percent error rate) and the Supplemental Security Income program (8.1 percent error rate).
  • Based on absolute spending rather than the error rate, the programs with the highest amounts of improper payments were Medicare Fee-for-Service ($36 billion), the Earned Income Tax Credit ($14.5 billion), Medicaid ($14.4 billion), Medicare Advantage ($11.8 billion) and the Supplemental Security Income Program ($4.3 billion).

De Rugy and Fichtner say such large improper payments are the result of having a massive government that is too large to oversee.

Source: Veronique de Rugy and Jason J. Fichtner, "Is Federal Spending Too Big to Be Overseen?" Mercatus Center, January 13, 2015. 


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