Buyout Watch: Who's Offering What
Gimme My Discount! Deals for Feds
Retirements Rise
Insufficient Insourcing Data?
Holidays Aren't Enough to Help USPS
Government's Moneyball Moment
Best Practices: Financial Management
- May 15, 2002
- Comments
ederal agencies spend nearly $2 trillion a year. If even a small fraction of the payments and grants agencies make are processed improperly-and they are-those errors add up to billions of dollars in wasted taxpayer dollars. To help agencies reduce payment errors, the General Accounting Office last fall published an executive guide to managing improper payments (GAO-02-69G). The following are among the best practices cited by GAO:
- Establish data-sharing arrangements with vendors, states and other federal agencies to identify improper payments that have already been made. For example, the Social Security Administration performs more than 20 data matches with more than 10 federal agencies and more than 3,500 state and local entities. Among other things, SSA obtains death records from states to make sure the agency isn't paying benefits to dead people. All told, SSA estimates that it saves $350 million annually in Old Age and Survivors Insurance and Disability Insurance, and $325 million annually in Supplemental Security Income through the use of data matching. Those same data matches save other agencies another $1.5 billion each year.
- Use data mining and statistical analysis to review payments and detect fraud. Since 1993, the Centers for Medicare and Medicaid Services has contracted with a statistical analysis firm to review claims for durable medical equipment. While data mining can identify potential overpayments, determining actual overpayments can require intensive-and expensive- investigation. Due to limited resources, CMS is able to pursue investigations only where data indicate large-scale abuse.
- Consider hiring a recovery-auditing firm, or establishing an in-house recovery auditing team, to review disbursements for accuracy. The Veterans Affairs Financial Services Center in Austin, Texas, uses recovery auditing to identify duplicate payments or overpayments. The center used to contract out the recovery auditing work, but it now has a small finance staff dedicated to performing the audits, which identified more than $2 million in overpayments and collected nearly $300,000 during the first six months of 2001.
FROM OUR SPONSORS
JOIN THE DISCUSSION
