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Feds made $236 billion in improper payments last year

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A new estimate of improper payments by the federal government shows 14 federal agencies made $236 billion in improper payments in fiscal year 2023, a decrease of about $11 billion from the prior fiscal year.

The U.S. Government Accountability Office estimate was included in a report published Tuesday. An improper payment is a payment that should not have been made or a payment in the incorrect amount. Improper payments can prove costly to the government, taxpayers, and the people who get the payments.

Since fiscal year 2003, improper payment estimates by executive branch agencies have totaled about $2.7 trillion.

“Reducing improper payments is critical to safeguarding federal funds,” according to the report. “We have noted that the federal government is unable to determine the full extent of its improper payments or to reasonably assure that appropriate actions are taken to reduce them.”

The GAO noted that one particularly problematic program wasn’t included in its estimates. The estimate doesn’t include the Department of Health and Human Services’ Temporary Assistance for Needy Families “a program that is susceptible to significant improper payments,” according to the report.

The Temporary Assistance for Needy Families (TANF) program gave states about $16.5 billion in 2022 to fund monthly cash assistance payments to low-income families with children and a range of other services.

Nearly three-quarters of improper payments across the 14 agencies were overpayments.

Improper payments have declined in recent years, but remain a stubborn challenge for many federal agencies. Improper payments peaked in fiscal year 2021 during the COVID-19 pandemic at $281.4 billion.

Most of the improper payments come from five federal programs. The GAO analysis of agency data showed that 14 agencies reported improper payment estimates across 71 programs. About 79% ($186 billion) of the government-wide total of estimated improper payments that agencies reported for fiscal year 2023 was concentrated in five program areas:

Medicare, comprising three programs ($51 billion);Medicaid ($50 billion);the Department of Labor’s Unemployment Insurance – Federal Pandemic Unemployment Assistance ($44 billion);the Department of the Treasury’s Earned Income Tax Credit ($22 billion);the Small Business Administration’s (SBA) Paycheck Protection Program Loan Forgiveness ($19 billion).

Some programs had high improper payment rates, among them Paycheck Protection Program (PPP) Loan Guaranty Purchases (49.1%), PPP Loan Forgiveness (40.5%), Farm Service Agency Emergency Conservation Program – Disasters (40.4%), according to the report.

The report was addressed to U.S. Reps. Mark Amodei, R-Nevada, and Adriano Espaillat, D-New York. Amodei and Espaillat did not respond to emails seeking comment on the report.

The $236 billion in improper payments in enough money for the U.S. Air Force to buy 341 nuclear-capable B-21 Raider stealth bombers at $692 million per plane. The Air Force plans to buy at least 100 such planes, according both the Air Force and defense contractor Northrop Grumman. Put another way, it would be enough to cover the cost of the Supplemental Nutrition Assistance Program, previously known as food stamps, for more than 23 months at 2022 spending levels.

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