WASHINGTON (CNNMoney) -- The Obama administration said Wednesday that federal agencies will save taxpayers billions of dollars by cracking down on waste and fraud.
"If we're going to spur jobs and economic growth and restore long-term fiscal solvency, we need to make sure hard-earned tax dollars don't go to waste," said Vice President Joseph Biden in a statement.
The main effort that could deliver big dollar savings is going on at Health and Human Services, which plans to use a special audit program to root out waste and fraud in Medicaid. Agency auditors say they expect to recover $2.1 billion over five years.... Or $420 million a year. Which sounds great, until you learn that that there are between $60 billion to $90 billion dollars wasted on fraudulent claims each year.
Since Medicaid is a state-federal partnership, with the states paying 45% of the costs, roughly $900 million from the $2.1 billion could be returned to cash-strapped states. Or 189 million a year.
This year, the existing auditing program over at Medicare recovered $670 million from overpayments or fraudulent payments, according to the White House. So the new program will recover less.
The vice president is also touting efforts to crack down on payments of unemployment benefits to people who shouldn't be getting them. I thought the WH said those benefits are a key part of their recovery program. So now they are trying to hurt their own recovery?
The Department of Labor is focusing on six states where fraud in unemployment benefits is particularly bad: Virginia, Indiana, Colorado, Washington, Louisiana, and Arizona. Improper payments of unemployment benefits have run as high as 43% of dollars distributed in Louisiana and Indiana. And how did Joe Biden let this happen? After all, jobless benefits are being paid for with stimulus money. And Biden is in charge to overseeing that. And worse, they knew these were fraudulent payments?
Those six states will have to undergo stricter reviews until they can get their error rate below 10% of dollars doled out for six months straight, according to the Department of Labor. How any states are below the 10% mark? My guess... none.