government payments

Solutions Exist for Improper Government Payments

Improper federal government payments are a major problem. It’s estimated that the federal government made more than $1.2 trillion in improper payments since 2002. These were mostly due to fraud or error.

Gordon C. Milbourn III works on the issue at the MITRE Corporation, and he says increasing communications between agencies will significantly reduce the problem. The government can use data analytics and other modern technology to find and track potential improper payments. The process has already been tried by the Centers for Medicare and Medicaid Services’ Fraud Prevention System and the Department of Labor’s Unemployment Insurance Integrity Center of Excellence. Congress has even adopted legislation to push agencies to use data analytics and seeks to have a central location for analytical data.

This process, however, is complicated by the legal structure within the federal government and “loopholes” in the law can make committing fraud easier. Once the fraudulent government payments are made, agencies face major hurdles to chase down and capture the payments.

MITRE Corporation created a process that it believes can enhance communications and decrease overpayments within the federal government. It includes:

  • Public-private partnerships and cross-agency work groups.
  • Information sharing and analysis centers, similar to the ones used to fight identity and cybercrime.
  • An increased focus on predictive analytics.
  • Increased data access and sharing.

A similar approach has been used at the Healthcare Fraud Prevention Partnership. The organization is a public-private partnership. It has nearly 80 members from across the country in areas of law enforcement, health insurance and state government. The members communicate and alert other members about fraud schemes and other potential problems. The organization has been responsible for preventing millions of dollars in fraud.


KDuncan & Company is dedicated to providing knowledge and support for small government contractors about concerns regarding government contracting. For questions on areas such as as cost proposals, accounting systems, DCAA compliance, and incurred cost audits, reach out to KDuncan & Company.

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