Senators urge crackdown on improper payments

Two senators last week pushed federal agencies to reduce billions of dollars in improper payments, asking agency leaders a series of questions about their efforts to improve internal accounting systems. Last Tuesday, Senate Governmental Affairs Committee Chairman Joseph Lieberman, D-Conn., and Ranking Member Fred Thompson, R-Tenn., sent letters to the heads of the 24 major agencies and their inspectors general asking them to review a report from the General Accounting Office that blames weak internal controls for billions of dollars in improper federal payments. Improper payments are overpayments to contractors and beneficiaries made as the result of miscalculation or fraud. The letters specifically ask agency heads to implement recommendations from GAO's May report, "Strategies to Manage Improper Payments: Learning From Public and Private Sector Organizations" (GAO-01-703G). The report, which Lieberman requested, urged federal managers to instill in the workforce a sense of accountability and stress the importance of efficient accounting systems. Agencies must provide the Governmental Affairs Committee with their strategies for identifying, tracking and reducing erroneous payments. Twelve of the largest agencies reported making improper payments totaling $20.7 billion in fiscal 1999, according to GAO. The watchdog agency concluded that a comprehensive risk assessment of programs vulnerable to waste and fraud and constant oversight of accounting systems are key elements in reducing improper payments. So far, no agencies have responded to the June 26 letter, according to Thompson's spokeswoman. A spokeswoman for the Education Department, which has come under fire for waste, fraud and abuse in the student financial aid system, said the department plans to send the committee a response sometime later this month. During an April hearing before the Senate Finance Committee, witness testimony revealed that benefits programs at the Department of Health and Human Services and the Social Security Administration pay an estimated $790 million a year to prisoners, fugitives, dead people, deportees and other ineligible recipients. GAO's report highlighted efforts by HHS and SSA to reduce erroneous payments. The report praised HHS' initiative to issue an annual estimate of improper payments in its medical fee-for-service program and SSA's data-sharing program with other agencies that helps confirm the eligibility of people applying for state or federal benefits. According to a March report from the HHS inspector general, the Health Care Financing Administration has cut Medicare overpayments by nearly 50 percent over the past five years.