Werfel: Gov’t avoids $47B in overpayments

OMB Controller Danny Werfel announced Wednesday the federal government avoided paying out $47 billion in overpayments over the last three years. This missed...

The federal government avoided making $47 billion in overpayments over the last three years. In addition, the governmentwide error rate dropped from 5.4 percent in fiscal 2009 to 4.3 percent in fiscal 2012.

Adding in the number of improper payments avoided during the same three-year period by the Department of Defense in commercial contracts, the overpayment savings rise to $70 billion and the governmentwide error rate sinks to 3.7 percent.

Danny Werfel, the controller of the Office of Management and Budget, announced these figures Wednesday in a blog post.

Werfel wrote that error rates dropped in major programs across the government, including Medicare Fee-for-Service, Medicaid, the Earned Income Tax Credit and the Supplemental Nutrition Assistance Program (food stamps). He added the Department of Labor is also working with states to reduce improper payments of unemployment insurance.

Danny Werfel, controller, OMB

“In total, the government has so far avoided over $47 billion in improper payments over the past three years, almost hitting the President’s ambitious goal of avoiding $50 billion in improper payments by the end of FY 2012,” Werfel wrote. “The administration also surpassed, by more than double, the President’s goal of recapturing for America’s taxpayers $2 billion in overpayments to contractors by the end of FY 2012.”

Werfel credited the successful Medicare Fee-for-Service Recovery Audit Contractor program with helping to recapture $4.4 billion in overpayments to contractors from 2009-2012.

When President Barack Obama entered office in 2009, he made reducing waste, fraud and abuse in the federal government a priority, issuing an executive order to target improper payments and signing the Improper Payments Elimination and Recovery Act in July 2010.


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