Medicare Paid Close to $60 Billion in Improper Payments in FY 2014

Senate Finance Committee Chairman Orrin Hatch (R-Utah) recently delivered an opening statement at the Senate Committee of Finance hearing examining how improper payments (including overpayments and underpayments) continue to infect our healthcare system and divert scarce resources away from critical programs.

According to Senator Hatch:

The Medicare program, which provides essential health coverage to elderly and disabled beneficiaries, paid out nearly $60 billion in improper payments in FY 2014. That’s nearly half of all the improper payments across the entire government…

Hatch pointed out that approximately one out of every ten dollars paid out of Medicare was paid in error. He continued:

Last year, Medicaid, our primary health safety net for poor and vulnerable Americans, paid out approximately $17.5 billion in improper payments. Just to put that into context the government spends in a year for the ENTIRE Temporary Assistance for Needy Families (TANF) program, our country’s main cash welfare program for the poor.

The Government Accountability Office reports $125 billion of improper spending in the last fiscal year alone. What could be purchased with $125 billion? According to Senator Hatch:

That amount would buy an iPad for every single American. It would buy every person in the country a year’s worth of meals at Chipotle. Or, to put it another way, $125 billion would be enough to pay for health insurance for every living person in Florida, our third most populous state.

While progress has been made to cut waste, Medicare fraud and Medicaid fraud is increasing. Whistleblowers are courageous men and women who continue to help curb the tide of continued fraud and abuse, and we salute them.

More information for whistleblowers is located at the Nolan Auerbach & White website.