Government Agency Wasted $143 Billion On Medicaid Overpayments In 2019-2020

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Dylan Housman Deputy News Editor
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The Centers for Medicare and Medicaid Services (CMS) wasted $143 billion on Medicaid overpayments during the last two years, and it hasn’t been transparent about its efforts to recover those funds.

CMS reported $57.36 billion and $86.49 billion in Medicaid overpayments in the fiscal years 2019 and 2020, respectively. The improper payment rates of 14.9% and 21.36%, respectively, represent a substantial jump from prior years, and CMS is required by the Social Security Act to recover improper payments that exceed three percent.

Americans for Prosperity Foundation (AFPF), a conservative nonprofit which seeks to advance economic freedom and promote limited government, filed a Freedom of Information Act (FOIA) request on May 5 asking CMS what efforts it had made to recover the overspent money, data on improper payment rates by state and internal communications within the agency regarding the issue. CMS did not answer the FOIA request, and AFPF and is now suing CMS in response.

“I have not been able to identify a bigger number historically, nor a more rapid surge. It’s the mother of all government waste statistics,” Americans for Prosperity senior health fellow Dean Clancy told the Daily Caller. “$143 billion is enough to cover another 24 million low-income adults, or another 7.2 million disabled people, for a full year.”

CMS has also failed to thoroughly respond to a March 2019 letter from Republican Pennsylvania Sen. Pat Toomey and Republican Iowa Sen. Chuck Grassley and a December 2020 letter spearheaded by Republican Wisconsin Sen. Ron Johnson.

Improper Medicaid payments rose from under 10% in 2018. The federal program has been identified as “high-risk” by the Government Accountability Office since 2003. (RELATED: NIH Spent $140 Million On Animal Testing In Foreign Countries Last Year, Watchdog Group Finds)

“To put it in perspective, $143 billion is the entire amount currently spent annually on Medicaid in the states of Texas, Florida, Ohio, Pennsylvania, and Illinois, combined,” Clancy added.

CMS was unable to respond to a request for comment by the time of this publication.