$100 billion in improper welfare payments per year

Thomas Lifson

The federal government is wasting an astonishing hundred billion dollars a year in improper welfare payments to recipients not entitled to them. This is an amount of money greater than the GDP of most nations on earth, more than Morocco and within striking distance of Hungary. The figure comes from a study by Veronique de Rugy and Jason Fichtner, who produced the following chart based on the OMB's High-Error Programs Report:


De Rugy notes:

Medicare fee-for-service, Medicare Advantage, and Medicaid top the chart and combine for $61.9 billion in improper spending, which should surprise no one given their sheer size. But their relatively high rates of errors should especially worry us as the federal government is expanding its reach into the health-care market - does anyone think the Affordable Care Act will be any different from other federal health programs?

Interestingly, though Medicare fee-for-service is the biggest drain in absolute terms - wasting nearly $30 billion in 2012 - it's far from the worst offender on a dollar-for-dollar basis. The Earned Income Tax Credit is responsible for $12.6 billion in improper payments, almost a quarter of what the program spent in 2012. 

This is yet another example of rampant waste, fraud, and abuse in government welfare programs. Taxpayers are being defrauded on a scale unknown in human history.

 

The federal government is wasting an astonishing hundred billion dollars a year in improper welfare payments to recipients not entitled to them. This is an amount of money greater than the GDP of most nations on earth, more than Morocco and within striking distance of Hungary. The figure comes from a study by Veronique de Rugy and Jason Fichtner, who produced the following chart based on the OMB's High-Error Programs Report:


De Rugy notes:

Medicare fee-for-service, Medicare Advantage, and Medicaid top the chart and combine for $61.9 billion in improper spending, which should surprise no one given their sheer size. But their relatively high rates of errors should especially worry us as the federal government is expanding its reach into the health-care market - does anyone think the Affordable Care Act will be any different from other federal health programs?

Interestingly, though Medicare fee-for-service is the biggest drain in absolute terms - wasting nearly $30 billion in 2012 - it's far from the worst offender on a dollar-for-dollar basis. The Earned Income Tax Credit is responsible for $12.6 billion in improper payments, almost a quarter of what the program spent in 2012. 

This is yet another example of rampant waste, fraud, and abuse in government welfare programs. Taxpayers are being defrauded on a scale unknown in human history.