Biden Administration Made $236 Billion in ‘Improper Payments’ Last Year: GAO Report

Speaker of the House Mike Johnson returns to his office at the U.S. Capitol, on March 22, 2024. (Photo by Kevin Dietsch/Getty Images)

An estimated $236 billion in improper or incorrect payments was made under the Biden administration last year, with Medicare and Medicaid accounting for $100 billion of that total, according to the U.S. Government Accountability Office (GAO).

“For fiscal year 2023, 14 agencies reported a total estimated $236 billion in improper payments across 71 programs,” said a March 26 GAO report. Improper payments refer to payments “that should not have been made or were made in the incorrect amount.” The $236 billion calculation does not include certain government programs that agencies determined were “susceptible to significant improper payments.”

As such, GAO believes the $236 billion estimate “potentially does not represent the full extent of improper payments.”

The group pointed out that improper payments suggest a “material deficiency or weakness in internal controls” at the agencies. “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.”

Medicare accounted for the largest percentage of government incorrect payments, totaling $51.1 billion.

This was followed by Medicaid at $50.3 billion, Federal Pandemic Unemployment Assistance at $43.6 billion, Earned Income Tax Credit at $21.9 billion, and the Paycheck Protection Program Loan Forgiveness at $18.7 billion.

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Out of the $236 billion, 74 percent were overpayments, 19 percent unknown, and five percent were underpayments.

“Nine federal programs reported improper payment estimates of $5 billion or more,” the report said. Meanwhile, “16 federal programs reported improper payment rate estimates of at least 10 percent.”

Improper payments in 2023 were $11 billion lower than in the previous fiscal year. The decline was attributed to factors like “terminating certain programs, implementing mitigation strategies, and suspending eligibility determinations for Medicaid during COVID-19,” the report stated.

The amount of such payments under the Biden administration since 2021 totaled more than $764 billion. GAO estimates the cumulative incorrect payments since fiscal year 2003 to total around $2.7 trillion.

In 2023, annual improper payments were at $35 billion. Such annual payments exceeded $100 billion for the first time in 2009 and $200 billion in 2020. “Reducing improper payments is critical to safeguarding federal funds,” the report said.

‘Systemic Mismanagement’

Following the release of the GAO report, House Committee on Oversight and Accountability Chairman James Comer (R-Ky.) and House Committee on the Budget Chairman Jodey Arrington (R-Texas), co-leaders of the Improper Payments Working Group, highlighted the need to control wasteful spending.

“It’s unacceptable our federal government made $236 billion in improper payments during the last fiscal year. This systemic mismanagement and waste of taxpayer dollars must be addressed,” said Mr. Comer. “As our national debt continues to balloon, it’s imperative we reduce government spending and waste.”

Mr. Comer vowed that the Improper Payments Working Group will continue to identify various ways by which the issue can be addressed.

Mr. Arrington pointed out that the $236 billion in wasteful spending is more than what the U.S. government spends on NASA, the Department of Education, and Homeland Security combined. He called the $2.7 trillion of wasteful spending since 2003 “a figure that is as stunning as it is unacceptable.”

“In order to restore fiscal responsibility to Washington, we must root out the gross mismanagement of Americans’ hard-earned tax dollars, rein in spending, and reverse the curse of a debt crisis that looms large over our children’s future.”

Before the release of the GAO report, Rep. Ashley Hinson (R-Iowa) had highlighted the issue of improper payments.

“The government issued over $236 billion of improper payments in FY23, more than the entire annual budget of the US Army. I’m working to ensure the Administration takes steps to prevent improper payments & stops letting taxpayer dollars fly out the door,” she said in a March 24 post on the social media platform X.

Wasteful Spending

The GAO report comes amid Republican attempts to rein in wasteful government spending. Congress recently passed a $1.2 trillion spending package to avoid a government shutdown, which was signed into law by President Biden.

While the measure passed Congress with bipartisan support, many Republicans opposed the bill, pointing to what they deemed excessive and wasteful spending.

In a March 22 X post, Rep. Tim Burchett (R-Tenn.), said that he “voted against spending $1.2 trillion, including: $27 billion increase for the Pentagon, $880 million for Middle Eastern countries’ borders (but not our own!), and $300 million more for Ukraine.”

“With inflation raging, Washington politicians are wasting your tax dollars on 8,000+ pork barrel ‘earmarks’ projects in the two spending bills ... $487K for a museum renovation, $500K for opera house upgrades, $1M for a social justice center,” Sen. Rick Scott (R-Fla.) said in an X post.

Former President Donald Trump has vowed to cut back on wasteful spending by the federal government if elected to a second term in office. “I will use the president’s long-recognized impoundment power to squeeze the bloated federal bureaucracy for massive savings,” he said in June last year.

The former president blamed President Biden for wasting “trillions of taxpayer dollars” since 2021, which caused “uncontrolled inflation that is crushing working families.”

“Reining in Biden’s wasteful and unnecessary spending is vital to stopping inflation and rescuing our economy from ruin,” he said.