The Recovery Board’s Advisory Panel recommended earlier this year that the Board collect data on improper payment rates for Recovery programs expected to exceed $1 billion.
The Board accordingly sent a request for the information to each federal agency that had received Recovery funding. Not all agencies responded, but a number did provide the Board with the appropriate information.
Recovery programs with the highest improper payment rates:
- Unemployment insurance - 11.2 percent
- Medicare and Medicaid - 10.5 percent
- Food stamps - 4.4 percent
Nine Recovery programs reported an improper payment rate of less than one percent, and the National Science Foundation reported a zero rate.
An improper payment does not necessarily involve fraud. According to the Office of Management and Budget (OMB), an improper payment occurs when:
- Money is sent to the wrong recipient
- There is an over- or under-payment
- The documentation is not available to support the payment
- Money is used improperly
OMB recently announced that the federal government reduced the amount of improper payments for all federal spending programs, including Recovery programs, by $17.6 billion in 2011. Most of the reduction resulted from decreases in payment errors in Medicare, Medicaid, Pell Grants, the Earned Income Tax Credit, and Food Stamps.
The government-wide error rate was reduced to 4.7 percent from 5.3 percent in 2010, OMB said.
More information about improper payment rates can be found at paymentaccuracy.gov, the OMB website that tracks improper payment rates.
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