Waste, Fraud, and Abuse in Federal Spending

Mar 11, 2014 by AFP

By Christine Harbin Hanson

The federal government spent over $100 billion in taxpayer funds improperly in 2012— one element of that notorious “waste, fraud, and abuse” in federal spending that we hear so much about. Scholars at the Mercatus Center recently released a chart that shows the breakdown of these improper payments across federal programs.

Perhaps not surprisingly, the lion’s share of this improper is in three largest healthcare entitlement programs: Medicare Fee-for-Service, Medicare Advantage (Part C), and Medicaid. Combined, these programs account for a whopping $61.9 billion in improper payments. To put that in perspective, $61.9 billion is more than the entire 2014 budget for the Department of Homeland Security. In other words, we’re talking about real money.

With the government’s ever-expanding role in healthcare – and the ever-expanding national debt – it’s now more important than ever for the federal government to get a handle on its healthcare spending.

Also of note, the federal government spent $2.7 billion in improper payments on the nation’s food stamp program, the Supplemental Nutrition Assistance Program (SNAP), which has seen the number of recipients grow from 33 million in 2009 to nearly 50 million last year. This welfare program comprises 80 percent of total Farm Bill spending, and lawmakers made disappointingly few reforms to this fast-ballooning program when they approved the Farm Bill conference report earlier this year. (Bonus read: AFP’s recommendations for reining in SNAP spending.)

Taking a broader perspective, this is what happens when government gets too big: Government spends so much that it can’t keep track of it. This is a problem for American taxpayers because it means that billions in taxpayer dollars go toward things that it weren’t supposed to. It reduces program effectiveness.

Americans for Prosperity has been active on the problem of improper payments. This past December, AFP released a coalition letter of support for legislation sponsored by Congressman Kingston that puts checks on improper payments. We’ve also worked closely with Capitol Hill offices in recommending ways to reduce waste in food stamp spending—such as instituting income and asset tests at the state level to ensure that beneficiaries meet the federal requirements for the program, and turning the program into block grants to encourage states to spend the money more effectively.

It’s one thing to say to oppose waste, fraud, and abuse in federal spending—it’s quite another thing to do something about it. Americans for Prosperity calls on Congress to focus on reducing improper payments in federal spending. Americans deserve to have their tax dollars spent as intended, not wasted on improper payments.