White House touts progress fighting waste, announces new initiatives

The White House on Tuesday made a push to highlight its six-month-old Campaign to Cut Government Waste, announcing recovery of $5.6 billion from civil and criminal fraud cases, curbing production of commemorative presidential coins, and unveiling a plan to crack down on wasteful and unsafe abuse of prescription drugs.

Reporting on the results of a morning Cabinet meeting led by Vice President Joe Biden, officials in a conference call with reporters announced a mixture of new initiatives and summations of accomplishments by three departments in curbing waste, fraud and abuse.

In June, Biden launched a campaign that requires each Cabinet secretary to make reducing waste a priority and report results to the White House and on a new website. In November, President Obama issued an executive order tasking agencies with reducing spending on travel, conferences and agency promotional items.

Deputy Attorney General James Cole on Tuesday said prosecutions of fraud, mostly in the health care field through partnerships between the Justice and the Health and Human Services departments, have more than doubled since 2008. "This is more than has ever been recovered in a single year in Justice Department history," he said, noting that the fraud occurred in grants, mortgages and procurement, though more than half was in Medicare and Medicaid. Of the overall amount recovered, almost $3.4 billion was due to civil fraud and more than $2.2 billion was attributable to criminal fraud.

Cole cited as examples a $15 million settlement with Texas-based American Grocers Inc., prosecuted for falsifying fresh food expiration dates and delivering the supplies to U.S. troops in Iraq and in other combat zones. He mentioned prosecution of CVS Pharmacy for inflating prescription drug claims in 10 states, and pursuit of 10 manufacturers of defective bulletproof vests whose products had led to injuries of law enforcement officers.

"For every $1 Congress invested in Justice prosecutions, it received nearly $7 for taxpayers," Cole added.

HHS Secretary Kathleen Sebelius said she told the Cabinet that health insurers are being urged to tighten controls to prevent "doctor shopping" by abusers of pain medication who seek to have prescriptions filled by multiple physicians in order to feed a habit or illegally resell the drugs. A Government Accountability Office report on the problem was the basis for an October hearing.

Medicare Part D plans "can be our partners" in tightening screening and declining to pay claims that appear suspicious until they are investigated, she said. It's both a taxpayer value and health issue, she added, noting that 450,000 emergency room visits annually are linked to abuse of prescription drugs such as OxyContin and Percocet. Tracking fraud also will be easier under new tools provided by the 2010 Affordable Care Act, Sebelius said. She said savings during the next several years could reach $2 billion, half of which would go to states.

The Obama administration has "reinvigorated" medical fraud prosecutions, Sebelius added. "There has never been a worse time to try to steal from Medicare," she said.

Deputy Treasury Secretary Neal Wolin reported that Biden and Treasury Secretary Timothy Geithner had told the Cabinet that Treasury was reducing the surplus inventory of $1 presidential coins that have been produced steadily by the U.S. Mint as required by a 2005 law. "The problem is demand for each drops immediately after it is issued," he said, noting that surpluses have increased more than 700 percent, leaving $1.4 billion in coins sitting in vaults, which "is not a prudent use of taxpayer resources."

To comply with the law, the Mint will continue to produce coins aimed at the collectors market rather than the 70 million or 80 million it currently makes, he said.

Sen. David Vitter, R-La., who had introduced legislation to curb production of the coins, issued a statement calling the decision "a big victory in the fight against mindless government waste, because these coins are a textbook case of wasteful spending -- something Americans just don't want or need."

Addressing other waste reduction moves under way, such as trimming use of agency promotional products, the officials said agencies already have made progress. HHS promised results by the end of the year, while Justice and Treasury already have ended use of so-called swag, officials said.

Cole added that Treasury already has saved $25 million in 2011 by reducing spending on professional conferences, though he reiterated that this year's inspector general's report that his department had spent $16 apiece for breakfast muffins had been retracted.