Medicaid Made $14.4 Billion in Improper Payments Last Year

For
the Government Accountability Office (GAO) has designated Medicaid,
the joint federal-state health program for the poor and disabled,
as being a high
risk for fraud.

But despite years of attention from the government watchdog, the
program continues to waste billions annually on fraud, abuse, and
other forms of improper payment.

In the 2013 fiscal year, the agency says in a new report, Medicaid
spent about $431.1 billion—about $14.4 billion of which was
improperly spent.

That’s actually down from the previous year, when the program
spent $19.2 billion improperly. But the fact that it’s still so
high—that’s nearly the total amount that Obamacare will likely pay
out in subsidies for private insurance this year—mostly serves to
reveal how big the problem is.

Of course, Medicaid looks positively thrifty when compared with
its bigger sibling, Medicare. The health program for seniors
improperly spent $49.9 billion in 2013, a nearly 12 percent
increase from 2012.

Even for the government, with its giant budgets and loose
attitude toward wasteful spending, this isn’t pocket change. And
it’s likely that similar sorts of payment mistakes will continue
under Obamacare, which is already paying insurance subsidies for
roughly 2 million people whose applications had inconsistencies.
Indeed, the GAO report warns that Obamacare’s Medicaid expansion
could further complicate the already complex, state-level program
integrity efforts for the program. The most straightforward way to
shrink fraud and abuse in these giant, complex health programs is
to shrink the programs themselves. Instead, we’ve expanded them,
and made more opportunities for improper spending in the
process.