$162 Billion In Improper Payments

The U.S. Government Accountability Office released its annual report today highlighting the amount of improper payments found in the previous fiscal year ending September 30, 2024. In it, the GAO reports $162 billion in waste, or as the reports states, improper payments in 16 agencies across 68 different programs. Approximately 84% of these improper payments ($135 billion) were the result of overpayments. The GAO estimates the total amount of improper payments since fiscal year 2003 at $2.8 trillion and the actual amount may be much higher.

The GAO report states, “….improper payment estimates do not represent the full extent of government-wide improper payments.” It further states, “….the $162 billion total represents a small subset of all federal programs and does not include certain programs that agencies have determined are susceptible to significant improper payments.” In short, improper payments are worse than the numbers suggest.

Agencies Excluded From GAO Report

Which agencies are more susceptible to improper payments and were not included in the numbers above? The list includes, 1) the Department of Health and Human Services’ Temporary Assistance for Needy Families (TANF), 2) the Department of Housing and Urban Development’s Office of Public and Indian Housing’s Tenant-Based Rental Assistance, and 3) the Small Business Administration’s Shuttered Venue Operators Grant program.” DHHS reports that it cannot determine the improper payments because it does not have the authority to obtain the information it needs for its TANF program. In 2022, the GAO recommended that Congress grant DHHS the authority to require states to report the data the agency needs to estimate and report on improper payments. As of January 2025, Congress had not acted on the recommendation.

Largest Sources of Improper Payments

The GAO reports that the largest percentage of improper payments were found in Medicare and Medicaid. The chart below shows Medicare (Parts A, B, C, D) had $54.3 billion in improper payments compared to $31.1 billion in Medicaid. The Supplemental Nutritional Assistance Program or SNAP had over $10 billion in improper payments.

The GAO report also says, “Specifically, GAO has noted that the federal government is unable to determine the full extent of its improper payments or to reasonably assure that agencies take appropriate actions to reduce them.”

Previous GAO Data

In FY 2003, the total reported improper payment estimate was 35.0 billion. If the improper payments grew at the rate of inflation since 2003, the 2024 estimate would be $59.5 billion. Thus, the last fiscal year GAO estimate of $161.5 billion represents an annual growth rate of 7.55%, much higher than inflation. It should be noted that the highest estimates from the GAO were from FY 2021 ($281.4 billion), FY 2022 ($247.0 billion) and FY 2023 ($235.8 billion) respectively. Improper payments fell by about $74 billion from FY 2023 to FY 2024.

Clearly, there has been a lack of oversight over the budgets of federal government agencies for decades. With the inception of DOGE, and with the backing of the Trump administration, the issue should receive some much-needed attention. No American should disagree with the task of returning transparency and fiscal responsibility to Washington. No one, except those who may have been enriching themselves at the expense of the American taxpayer. Thus, the debate today is focused more on the execution of the DOGE initiatives and not the intent.