Payment Errors Cost U.S. Billions


The U.S. government made US$106 billion in improper payments in 2013, according to the Government Accountability Office.

The incorrect payments either went to the wrong person, were the wrong amount, or lacked proper supporting documentation. Some were also the result of fraud.

Of the total, US$97 billion were overpayments and US$9 billion were underpayments. The director of the White House budget office said that US$22 billion has been recovered.

The total is less than in 2012 and is an improvement since the amount rose to US$121 billion in 2010. The incorrect-payment error rate was 3.5% of payments made–down from 5.4% in 2009.

The program with the highest rate of error was the Department of Agriculture’s school breakfast program (25%) which resulted in US$831 million in improper payments. A close second was the Earned Income Tax Credit program, with a 24% error rate that resulted in US$14.5 billion in payment mistakes.

Medical care programs were also prone to costly mistakes. The HHS’s Medicare fee-for-service program reported $36 billion in improper payments, Medicaid $14.4 billion, and Medicare Advantage $11.8 billion.

The federal unemployment insurance program registered US$6.2 billion in improper payments and a 9% rate of error.

The Pentagon registered a low rate of error (1%), but this figure is scrutinized by the fact that much of the Pentagon’s spending is deemed unauditable by the GAO due to unreliable documentation.




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