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BREAKING NEWS: DOGE Fraud Committee Meeting · Elon Musk Podcast

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All right, thanks. Beyond government operations
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will come to order and I want to welcome everyone to this, what I
1:34
think is going to be an important bipartisan hearing
1:39
today. Without objection, the Chair
1:41
made a clear recess at any time and I recognize myself for
1:45
making an opening statement to our witnesses that are here
1:50
today into the people who have taken time to come here to see
1:57
today, as well as my colleagues. I want to really dispense with
2:02
my opening statement and without objection, I'll enter that into
2:06
the record. But what I'd like to say is, is
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that this is a follow up to the meetings which we have held for
2:13
the last few years, where there was active discussion, not just
2:18
about what we were going to do to recognize what might be
2:23
considered waste, fraud or abuse.
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Or money that was spent by the federal government that did not
2:31
equal that which it was intended to do, which kept money away
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from the real recipients. And for people who would have
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benefited with congressional intent.
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As you will recall, last year we held what was a meeting in
2:50
October whereby we had GAO and others who came to speak with us
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and they came up with a what might be a three-year number of
3:01
their ideas about inappropriate payments than waste, fraud and
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abuse. But things that were paid that
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we felt like we're not permissible or following the
3:12
intent of the law or the needs of the money.
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Mr. Mfume and I at that time looked at each other and said we
3:21
are going to work together. We are going to challenge GAO to
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come back to us. We are going to find within the
3:30
government other particular people who have talent, data,
3:36
information and can lead us to a better solution.
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I'm pleased to say, Mr. Infume, I believe this is the beginning
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of that, turning the corner to where we will then not just work
3:50
together but try and discover the things that reside within
3:54
the government to gain the information is necessary.
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And I think today's hearing will prove that in.
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So I'm delighted that you were here.
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I'm going to put my opening statement on the record, but
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that is what I want to say. This is about identifying,
4:12
preventing fraud, improper payments in federal programs.
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And we're going to learn today how we're better prepared if we
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work together, if we find a way. And I think we will not just
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work together, but to use the important elements of this
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government for data, information and lessons learned.
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And I would say thank you for being here.
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Distinguished gentlemen wish to have time for an opening
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statement. I do Gentleman's recognized.
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I do. Mr. Chairman, thank you very
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much. Good morning to you.
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Good morning to our witnesses who are here.
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And I want to just personally thank Chairman Sessions for the
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manner in which we continue to meet each other halfway, even
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though we're on different sides of the aisle, to come together
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to find a way at least to release the federal government
5:05
of some of his ailments, particularly this whole notion
5:09
of improper payments, waste, fraud and abuse.
5:12
We did that throughout the 118th Congress and my colleagues and I
5:16
on this subcommittee all remain laser focused on combating those
5:20
matters. And I think we also have always
5:24
agreed that this is a non partisan matter.
5:26
No matter where we are in our country or philosophically, we
5:31
agree that every dollar directed to every program ought to go to
5:35
the intended purpose. From the very beginning of this
5:40
President's term, the so-called Department of Government
5:43
Efficiency, and some of you know that I have referred to it as
5:47
the Department of Government evil for my own particular
5:50
purposes because of the way it's affected working men and working
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women and their families across this country.
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I think hard working, dedicated men and women exist in every
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Congressional District throughout the country.
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And while there is still no full complete public accounting on
6:07
all of them who have been dismissed, other than numbers,
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we don't know the names and the faces and the families, the
6:13
children and the mortgages and everything else.
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It's been disrupted by this. I've got no doubt that among the
6:21
hundreds of thousands of federal employees affected by the fork
6:24
in the road e-mail and the mass firings and a probationary
6:27
staff, that many, many are experienced in the pain that we
6:33
do not feel right now. And that's not to even mention,
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as I'm sure the chairman would mention also, the 18 inspector
6:41
general's that have been dismissed.
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They were like the sheriff's that were running the town and
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doing a damn good job at it and reporting back to this committee
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and both the chairman, Sessions and myself on real clear ways of
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trying to move us forward deliberately and focused.
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And I commend their work. I look forward hopefully to the
7:02
return of some of them, and I know that their role cannot be
7:07
understated. We're already in a situation
7:11
where 10 of 24 agencies subject to the Payment Integrity
7:17
Information Act we're not fully compliant with improper payment
7:21
reporting requirements as of 2022.
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It is the furthest thing from common sense, in my opinion, to
7:28
fire the inspector generals who have a real set of experience
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and a body of experience addressing this problem.
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As witnesses have discussed in many of our previous hearings on
7:39
this issue, particularly last September, combating fraud,
7:43
improper payments abuse is not as simple as waving a magic wand
7:49
or a chainsaw. Real progress relies on access
7:54
to quality data. It means thoughtful partnership
7:57
with agency leaders, and it means investments into the
8:00
technology and the staff needed to create proper internal
8:05
controls to prevent improper payments and fraud.
8:10
I was proud to join with many of my colleagues on the Oversight
8:13
Committee and introducing recently the Taxpayer Funds
8:15
Oversight and Accountability Act, which in many respects
8:19
would make important strides in adjusting these challenges.
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Simply put, I think we have a real challenge before us, not to
8:29
mention the fact that sometimes we're not focusing on some of
8:33
the real issues. I would call everyone's
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attention to the fact that the largest agency and with the
8:41
largest budget is still the Pentagon and we have witnessed
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seven straight audits that have failed because of problems at
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the Pentagon. I don't know how you can fail
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seven straight audits and not become the focus of waste, fraud
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and abuse. That's another story, perhaps
9:02
for another time, but it is something that continues to cry
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out for very real attention. The GAO reported recently a
9:11
total of 162 billion in improper payments and government wide
9:15
matters in fiscal 24 and that marks a significant reduction.
9:21
It's almost embarrassing to say that that's a significant
9:24
reduction from the 236 billion in improper payments in fiscal
9:28
2023. In recognition of the shared
9:31
challenge, Chairman Sessions and I, on a bipartisan way, work to
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discover real pathways to reducing fraud and to reducing
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improper payments. This past October, both he and I
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sent a joint letter to the GAO requesting that they review, as
9:48
was mentioned earlier, $2.7 trillion and improper payments
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and fraud that have occurred since 2003 and provide
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actionable recommendations before this committee.
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So, as I conclude, I must mention the importance of
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staying grounded in the scope and the breadth and the depth of
10:08
this problem. While improper payments and some
10:11
fraud exists, that does not mean that the bedrock of social
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safety net programs like Medicaid, Medicare, and Social
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Security should be cut or privatized.
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The existence of these problems does not justify in any way mass
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firings of workers, failures to pay nonprofit organizations.
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It does not justify the fact that the government owes for
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work done in so many instances and that the effort really is
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moving to destroy many of the federal agencies as we come to
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know them. Even despite the claims that
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Social Security is rife with fraud and fraudulent payments
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due to quote, long dead individuals who are about 133
10:55
years of age, that program has a payment accuracy rate of over
11:00
90%. And that's according to the
11:03
Center for Budget Priorities. So as we move forward, as
11:07
together, hopefully with our own differences of opinion, but in
11:11
an effort to move forward together to combat waste, fraud
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and abuse as we know it and as we are defining it.
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I hope that we as a Congress will remember that the purpose
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of this weighty task is not to exploit these problems or to
11:28
destroy the federal government in the process, but to work for
11:32
a better country. And to do that, as the chairman
11:35
has said, hand in hand, working together despite our
11:38
differences, to come up with a consensus.
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That's what we really want, consensus approaches that are
11:45
not on the extreme left or the extreme right, but in the middle
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where most people are and in the middle where the problems are,
11:53
so that we can deal with this issue in a very responsible sort
11:56
of way. And to be able to report back to
11:58
the American people that we really have made an impact in
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dealing with the issues of waste, fraud, and abuse.
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Again, I cannot say enough about the Chairman Sessions work in
12:09
this regard. In this committee's work, we
12:12
didn't get a lot of attention, but we were in the forefront for
12:14
the last two or three years. So it's good to know now that
12:18
people are paying attention. We just have to make sure that
12:21
we are doing this the right way and in a way that is
12:24
responsible. Thank you, Mr. Chairman, and I
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would yield back. I appreciate the gentleman's
12:30
dialogue. I want to say that maybe 10% or
12:33
more, I think more of the American people want, expect and
12:37
need us to work together. And you have my promise that it
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will continue to be done and we will work together.
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I you have a strong voice, you have a strong idea of what
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you're after. But what we're dealing with here
12:52
is something that must be overtaken.
12:57
We have to win on this. And it will be a bipartisan
13:01
effort. And I think the two with the
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three witnesses that we have today are shining examples that
13:08
can lead the way, not the partisanship, but the answers.
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And I think that's what we seek. I want to thank your
13:15
conversation today. And I think that we'll see that
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also. Sir, thank you.
13:21
I want to request unanimous consent that the gentleman, Mr.
13:25
Moskowitz from Florida, be waived on today's hearing for
13:28
the purpose of asking questions. That objection, so ordered.
13:34
OK. We're now going to get to the
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big deal and the big deal is our witnesses who takes seriously
13:42
not only that effort that you and I in this subcommittee
13:46
share, but also ideas and answers for leading us to that.
13:51
I'd first like to introduce Kristen Cokie Leak serves as the
14:00
managing director, financial management assurance team at the
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GAO. In her role, she overseas issues
14:06
involving accountability, professionalism, auditing
14:10
standards and DoD financial management and improper
14:15
payments. Please know that you are being
14:17
heard as well as your party when there are conversations about
14:21
DoD. Next we have Mr. Dieffenbach.
14:25
Ken was appointed to the Pandemic Response Accountability
14:29
Committee in June of 2024. He brings over 28 years of
14:35
experience in the oversight community and served in various
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roles related to investigation and data analytics.
14:43
We also have Jennifer Wagner. She joined the Center for Budget
14:47
and Policy Priorities in 2015. She focuses primarily on
14:52
Medicaid eligibility and enrollment issues, which
14:56
certainly highlights some of the discussions that the American
15:00
people want us to delve into. I'm delighted that all three of
15:05
these witnesses here. I would now ask that all the
15:07
witnesses rise pursuant to Committee Rule 9.
15:10
G. The witnesses will stand as
15:13
required. Raise their right hand.
15:16
Do you solemnly swear or affirm that the testimony they're about
15:19
to give is the truth, the whole truth, and nothing but the
15:22
truth. Truth so help you God if the the
15:25
workers show that the witnesses answered in the affirmative.
15:28
Thank you very much. You may now take a seat.
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I tried to keep my comments short.
15:34
The stream fume did same, but we speak from one voice.
15:38
We are both delighted that you're here today.
15:40
So let me remind the witnesses that we have your written
15:44
statements and I would encourage each of the the staff and the
15:51
members who are here to look through this if they have not up
15:55
to now, data and information about actual data and actual
16:01
solutions is what today's hearing is going to be about.
16:04
So I want to first make sure that we go right to this.
16:09
I'll let everybody turn to their information that they've got
16:13
there. Mr. Miss Key Co Key leak.
16:19
I didn't get it right yesterday and I'm not going to get it
16:21
right today. Please correct me.
16:23
Co select. Co select a bill had me say Co
16:27
select five times yesterday. That was not today.
16:30
We're delighted that you're here.
16:31
Please know this that we traditionally will follow the
16:35
five minute rule as we always have.
16:37
But I think that as we go through there, if you want to
16:40
finish questions or or the statements you want to make.
16:44
But as we get into questioning, I'm very interested in both
16:48
sides, the members and our our witnesses getting to where they
16:53
want to get. And without a further
16:57
discussion, we will recognize Miss Coakley.
17:01
Thank you. Good morning, Chairman Sessions,
17:04
Ranking Member and Fume, and members of the subcommittee.
17:08
Thank you for the opportunity to be here today to discuss the
17:11
long standing and pervasive issue of improper payments and
17:14
fraud in the federal government. Whether it involves an
17:18
established program or one created to respond to an
17:20
emergency, improper payments and fraud erode the public trust in
17:24
government and result in hundreds of billions of dollars
17:27
lost. Improper payments and fraud are
17:30
two distinct concepts. They're related, but not
17:33
interchangeable. Simply put, improper payments
17:37
are payment errors, payments that should not have been made,
17:40
or payments that were made in the incorrect amount.
17:42
These could be overpayments, underpayments, or payments to
17:45
ineligible recipients. Fraud involves obtaining
17:49
something of value through willful misrepresentation.
17:53
Individuals or organizations deliberately lying to defraud
17:56
the federal government. While all fraudulent payments
18:00
are considered improper, not all improper payments are considered
18:04
fraud. That's right.
18:05
Since 2003, federal agencies have made an estimated $2.8
18:09
trillion in improper payments, including an estimated $162
18:14
billion in fiscal year 2024. Since these year to year
18:19
estimates are based on a subset of government programs, 68
18:22
programs in 2024, the actual improper payments amount may be
18:26
significantly higher. Last April, we estimated that
18:30
based on data from fiscal years 2018 to 2022, the federal
18:34
government annually lost between 233 and $531 billion or about 3
18:41
to 7% of federal spending to fraud.
18:45
Our fraud estimate includes all federal programs and the wide
18:48
range reflects the different risk environments during the
18:51
five year period, including normal operations and COVID-19
18:55
relief programs and spending. Fraud at this level indicates
18:58
the importance of fraud risk management.
19:01
However, most government spending is not fraudulent.
19:05
While my written statement more fully covers GA as wide body of
19:08
work in these areas, I will focus this morning on how
19:11
agencies and the Congress can work to better prevent improper
19:15
payments and fraud. The best way to reduce improper
19:19
or fraudulent payments is to not make them.
19:22
Preventive controls, as their name implies, are meant to stop
19:26
improper and fraudulent payments before they occur.
19:30
One key government wide preventive control is the use of
19:33
Treasury's Do Not Pay system. Do Not pay consolidate much of
19:37
the data matching agencies have done individually to flag
19:41
potentially improper or fraudulent payments.
19:44
Federal agencies and some state programs can and should leverage
19:48
Do Not Pay to ensure program integrity.
19:52
Another important action agencies can take is to assign
19:55
assign responsibility for tackling improper payments and
19:58
fraud to senior level officials. This helps establish
20:02
accountability and endows those officials with the authority to
20:06
lead and make change. In our March 2022 testimony
20:10
before the Senate Committee on Homeland Security and
20:13
Governmental Affairs. We recommended 10 actions that
20:16
Congress could take to increase accountability over improper
20:19
proper payments and fraud across the federal government.
20:22
As of today, these recommendations to Congress
20:25
remain unaddressed. To improve transparency and
20:29
accountability over fraud management, we recommended that
20:32
Congress reinstate the requirement that agencies report
20:35
on their anti fraud controls and fraud risk management efforts in
20:39
their annual financial reports. And to better prepare for future
20:43
emergencies such as hurricanes, wildfires, or pandemics.
20:47
We recommended that Congress require OMB to provide guidance
20:51
for agencies to proactively develop internal control plans
20:54
that will be ready for use in future crises and require
20:58
agencies to report these plans to OMB and Congress.
21:02
Finally, to facilitate data access and data sharing, which
21:06
is key to effective prevention, we recommended that Congress
21:10
consider amending the Social Security Act to explicitly allow
21:14
the Social Security Administration to share its full
21:17
death data with Treasury's Do Not Pay system.
21:20
In December 2020, Congress passed legislation requiring the
21:24
Social Security Administration to share its full death data
21:27
with Treasury's Do Not Pay system for a three-year pilot
21:30
period. This requirement is set to
21:33
expire in December 2026, and we think Congress should make it
21:37
permanent. Earlier this year, Treasury
21:40
reported that data sharing during the pilot had led to $31
21:44
million in improper payments prevented and recovered over its
21:48
first five months, and the pilots projected net benefit is
21:51
over $215 million for the full three years.
21:55
Congress can make an immediate impact by ensuring the Do Not
21:59
Pay system continues to have access to the Social Security
22:02
Administration's full death data.
22:05
Continued congressional oversight is critical to
22:08
ensuring that agencies address improper payments and fraud in
22:11
their programs. Along with the actions detailed
22:14
in my written statement, Congress can use a variety of
22:16
tools such as hearings and the appropriations, authorization
22:20
and oversight processes to incentivize agencies to improve
22:24
program integrity. This concludes my opening
22:26
statement and I will be happy to answer questions.
22:30
Thank you very much, the distinguished gentleman.
22:34
Mr. Deffenbaugh, you're recognized.
22:38
Thank you, Chair Sessions, Ranking Member and fume members
22:42
of the subcommittee. It is an honor to be here today
22:44
to talk about the critically important topic of preventing
22:47
fraud in federal programs. This subcommittee has been at
22:50
the forefront of bipartisan efforts to find solutions to
22:53
reduce fraud and other types of improper payments.
22:56
Today's hearing comes at a critical time because unless
22:59
Congress takes action, one of the most significant tools it
23:02
has created to improve program integrity will be lost.
23:06
As the executive director of the Pandemic Response Accountability
23:10
Committee, or PRAC, an entity Congress created almost five
23:13
years ago to oversee $5 trillion in relief funding, I can point
23:18
to untold examples where fraudsters stole hundreds of
23:22
billions of dollars from taxpayers and the intended
23:24
beneficiaries of these programs. As a federal law enforcement
23:28
officer who has spent over 28 years bringing to justice
23:32
fraudsters who stole from federal programs, I know first
23:35
hand that unless we invest in cross agency prevention and
23:39
enhance data sharing, we will continue to be victimized by
23:43
increasingly sophisticated and well resourced bad actors.
23:48
Pay and Chase is not the solution, Prevention is.
23:53
To be clear, agencies have the primary responsibility to
23:56
prevent fraud. But the PRAC in the OA GS also
23:59
play an important role. Since its formation in 2020, the
24:04
PRAC has time and again alerted federal agencies, Congress, and
24:08
the American public to the lessons learned from the
24:10
pandemic and our recommendations to help strengthen federal
24:14
programs. For example, we issued a fraud
24:17
alert on the use of suspicious Social Security numbers in
24:20
obtaining over $5.4 billion in SBA relief programs.
24:26
We've not only identified potential fraud, but we're also
24:29
actively working to recover stolen funds.
24:32
We are partnering with 48 federal law enforcement agencies
24:35
to support over 1000 investigations related to over
24:38
$2.4 billion in potential losses.
24:43
As we will discuss today, the time to prepare for the next
24:45
disaster is now, not when new funds start flowing.
24:49
We must act on these lessons learned.
24:53
For example, we must address obvious anomalies such as Social
24:57
Security numbers that have never been issued or were issued to
25:00
people who are now deceased, dates of birth indicating an
25:04
applicant is 10 or 110 years old, applicants who have already
25:09
applied in five other states, or applicants who use names like
25:13
Charlie Chaplin, Abraham Lincoln, or Foghorn Leghorn, as
25:19
at least three people did in pandemic programs.
25:21
Those three were stopped before the money was dispersed.
25:24
Let me assure you, the government must pause and more
25:27
closely review suspect claims before money is dispersed.
25:31
We must look across multiple programs for red flags, as
25:34
fraudsters do not follow our government organizational
25:38
charts. They steal from wherever it is
25:40
easiest to steal. We must also responsibly
25:44
leverage more data, especially data already in the possession
25:47
of the government, to identify suspicious patterns and trends
25:50
indicative of fraud schemes. Today, the PRAC has the
25:54
capacity, infrastructure, relationships and talent to
25:56
conduct pre award vetting and the more complex network and
25:59
trend analysis. We know from our work that
26:02
fraudsters can apply to all 50 States and territories from
26:05
behind one keyboard. They can hit multiple federal
26:08
programs using the same false information.
26:11
They can outsource these tasks to artificial intelligence and
26:14
bots. But the PRAC is scheduled to
26:16
sunset in September of 2025, and we're only two months away from
26:21
having to begin deleting our data that we have collected and
26:24
curated over the last five years.
26:26
This includes over 60 major data sources and some 1.7 billion
26:31
data points. We're also concerned about
26:33
losing more of our staff whose outstanding analytical expertise
26:36
is in great demand. We will soon reach the point of
26:39
no return, in which rebuilding this capacity would take several
26:42
months, if not years, and a significant new investment of
26:45
taxpayer dollars. the US General Accountability Office has
26:48
expressed strong support for the PRAC.
26:50
An estimated their analytics capability could result in an
26:53
annual financial benefit of a billion dollars or more a year
26:58
if the PRAC ceases operations in September.
27:01
The next time the government responds to a natural disaster
27:03
and economic crisis, or another event where we are quickly
27:06
dispersing benefits to people in need, fraudsters will again
27:10
swoop in and steal. We will then inevitably ask
27:14
ourselves, how did we lose so much money to fraud?
27:18
If this happens, it will be because we chose not to be
27:21
prepared, and we chose not to invest in fraud prevention and
27:26
increase data sharing. Instead, we should continue the
27:29
investment that Congress has made to the prac in the PRAC
27:32
which is proven, which has a proven track record and a
27:35
demonstrated return on investment.
27:37
American taxpayers deserve nothing less.
27:40
I look forward to your questions.
27:43
Thank you very much for the audience that may be watching,
27:46
that is the Pandemic Response Accountability Committee that
27:51
was referred to as PRAC. Thank you very much, Miss
27:54
Wagner. You're now recognized.
27:56
Chairman Sessions, Ranking Member and FUME, and members of
27:59
the Government Operations Subcommittee, I am honored to be
28:02
here today to discuss something I've spent over 20 years working
28:05
on, improving government systems to get the right benefits to
28:09
eligible people in a streamlined and accurate way.
28:12
I started my career as a food stamp caseworker in North
28:15
Carolina and then worked for the Illinois Department of Human
28:17
Services before joining CBPP. I'm going to focus today on
28:22
Medicaid and SNAP, specifically on three key points.
28:26
First, Medicaid and SNAP have a rigorous eligibility
28:29
verification process, and the vast majority of people are
28:32
eligible for the benefits they receive.
28:35
Mistakes are made, but most improper payments are paperwork
28:38
issues, not fraud. Second, running an accurate
28:42
program means making sure eligible people can get and keep
28:46
benefits. When we talk about program
28:48
integrity and accuracy, we need to talk about how adding red
28:52
tape can harm eligible families. And 3rd, there are effective
28:57
ways to reduce improper payments and improve program integrity,
29:01
but some of the solutions proposed don't match the
29:03
problems. They don't solve improper
29:06
payments and will increase errors.
29:09
Let's dig in. First, nearly all of the people
29:12
enrolled in SNAP and Medicaid are eligible for their benefits.
29:15
Applicants fill out complex forms with details about their
29:18
household expenses and income. Agencies verify that information
29:23
against federal, state, and commercial databases.
29:27
If the application and database don't match, the applicant must
29:30
send verification like a pay stub.
29:33
Improper payments are not the same as fraud and are primarily
29:36
caused by paperwork errors. For example, a Medicaid worker
29:41
might check a database to verify an applicant's eligibility, but
29:44
not capture and retain the data viewed in that moment.
29:48
When a reviewer comes and looks at that case months later, they
29:51
can't confirm the case is correct because they can't see
29:54
what the worker looked at when the case was improved was
29:57
approved. There's no indication that the
29:59
applicant isn't eligible, but since the paperwork is missing,
30:03
it's considered an improper payment.
30:05
This is a technical problem, not a fraud problem.
30:09
Second, it is important to acknowledge 1 shortcoming of
30:12
improper payment measures. They only consider those who
30:15
receive benefits. They don't consider those who
30:18
are eligible but couldn't enroll due to confusing notices or
30:22
agency mistakes. We must keep this in mind when
30:25
in when evaluating solutions to improper payments.
30:29
Which brings me to the my Third Point.
30:31
Many proposed solutions don't match the problems and won't
30:35
reduce improper payments or improve accuracy.
30:38
For example, requiring Medicaid renewals every six months
30:42
instead of every year will cause more problems than it solves.
30:45
More paperwork will lead eligible enrollees to miss out
30:49
on benefits for procedural reasons, not because they don't
30:52
qualify for the program, but because they don't receive or
30:55
return a notice or the agency doesn't process that paperwork
30:58
timely. And more work for already
31:00
overwhelmed state staff will lead to more mistakes and more
31:04
improper payments. So what would work?
31:07
The Government Accountability Office identified 2 strategies
31:10
that have been successful in reducing improper payments,
31:13
establishing accountability and facilitating internal
31:16
collaboration, and providing technology tools and training
31:20
targeted to root causes. Federal agencies overseeing SNAP
31:24
and Medicaid need sufficient staff in key roles to make this
31:27
happen, such as Inspectors General to audit eligibility
31:31
determinations and staff to provide technical assistance and
31:34
hold states accountable for fixing the issues that are
31:37
discovered in audits. We saw this approach work.
31:40
Federal agencies recently helped states better implement the
31:43
requirement to conduct ex parte renewals, which happened when
31:47
data sources confirm ongoing eligibility and enrollees don't
31:50
have to fill out complex paperwork to renew.
31:53
The United States Digital Services worked with States and
31:56
more than 5 million people were renewed for coverage with less
32:00
red tape last year. Another solution is the Medicaid
32:03
Eligibility Enrollment Rule, finalized in April of 2024,
32:08
which updates outdated regulations on case record
32:10
maintenance and will substantially reduce the
32:13
frequency of improper payments resulting from inadequate
32:16
records. It's not an easy task to address
32:19
improper payments in large programs serving millions of
32:22
people. Proposals that suggest billions
32:25
of dollars can easily be saved don't address improper payments
32:29
and would result in cutting eligible people off from vital
32:32
help. But embracing solutions that
32:34
match the actual problems can bring us closer to the goal of
32:38
getting the right benefits to eligible people in a streamlined
32:41
and accurate way. Thank you for the opportunity to
32:44
testify and I look forward to your questions.
32:51
Thank you very much Mr. Fume. You heard me say that I felt
32:56
like our witnesses all were not only vital to our decision
33:00
making, but have appeared in a way to give us answers to these
33:04
problems. Thank you very much.
33:07
Want to thank each of our witnesses.
33:09
I'm first going to go to the distinguished gentlewoman from
33:12
North Carolina, Chairwoman Virginia Fox.
33:15
Gentleman's recognized. Thank you, Mr. Chairman, and I
33:19
thank our witnesses for being here today.
33:22
Miss Kosilek. The Payment Integrity
33:24
Information Act codified the Do Not Pay Initiative, which
33:29
provides agencies with access to certain databases that can
33:33
assist in preventing improper payments and requires a review
33:37
of the available databases prior to the release of funds.
33:41
Despite this requirement, it is unclear that agencies are
33:46
utilizing the Do Not Pay system. For example, the Department of
33:50
Transportation Inspector General reported in November 2023 that
33:55
the agency did not use the Do Not Pay portal in prepayment
33:59
processes as the law requires. In your opinion, why do agencies
34:05
not use all the tools at their disposal to prevent improper
34:10
payments? And do you believe that there
34:12
are ways to improve the Do Not Pay system?
34:19
Thank you. Yes, I think there are ways to
34:21
improve the do not pay system. As I mentioned, making sure that
34:26
full death master file is in there and that all relevant data
34:31
sources are in there is is key to making sure that that source
34:37
of information is as complete and reliable as it can be.
34:41
A way that you to encourage agencies to use it is really to
34:46
think about how you would do reporting.
34:49
I think right now agencies kind of report on the back end of
34:55
what went wrong. Thinking about how you would
34:58
have agencies report about preventing.
35:00
So for instance, the Do Not Pay system and Treasury payment
35:04
integrity tools can flag payments that potentially would
35:09
have indicators that they may be improper.
35:12
However, as noted, it really is up to the agencies to make
35:15
decisions about whether a payment will be made.
35:18
You could consider having agencies report on when those
35:21
flags are not upheld. For example, if something is
35:27
flagged and do not pay, but a payment is made anyway.
35:30
Having agencies track that, identify that, and report back
35:33
when that is happening would help folks determine if there
35:38
there are instances where the payment should go ahead anyway,
35:40
or if truly that payment should have been stopped.
35:45
Let me follow up with another question for you and Mr.
35:51
Dieffenbach. Once an improper payment is
35:55
made, what can an agency do to recover the payment and how much
35:59
does it cost in human hours and dollars to recoup an improper
36:04
payment? First, you Miss Kosilek.
36:07
Sure. There are requirements for
36:10
agencies to attempt to recover improper payments and I believe
36:15
it's up to the agencies to determine when it's cost
36:18
beneficial to do so. So there it can be instances
36:22
where an agency may determine it is not cost beneficial to pursue
36:26
all avenues in recovering that you would hope that agencies
36:29
would, but I think it's left to their determination to determine
36:32
when it's cost beneficial. Thank you for the question,
36:37
Congresswoman. Agencies have a number of
36:39
options for trying to recover improper payments.
36:42
There are administrative possibilities, the options the
36:45
Congress did just pass the Administrative False Claims Act
36:48
in December, which is a significant new tool for
36:51
agencies and OGS to work with jointly that allows agencies to
36:55
go through a very rigorous process where they can then
36:58
recover funds and damages in some instances.
37:02
But to your point, recovering funds through through the
37:04
judicial system, the pay and Chase model we have now is
37:07
exorbitantly expensive, which is why we and others in this
37:09
hearing are focused on the prevention piece, because it is
37:12
very expensive to do any of those recovery actions.
37:15
So what investments could agencies take to prevent
37:19
improper payments? Could investments in artificial
37:22
intelligence help lower the improper payment rate?
37:26
What? Again, what we want to do is not
37:29
have the payment go out to begin with by using what's available
37:33
to the agencies now. So I'll start with you, Mr.
37:36
Diefenbach. Yes.
37:38
So technology is part of the solution.
37:40
Another piece of it is culture is ownership, and the Inspector
37:44
General Act was passed in 1978 to create this community of
37:48
watchdogs to prevent fraud. However, before 1978 and today,
37:52
the agencies have the primary responsibility to do those
37:56
things, to resource things properly, to exploit technology
37:59
as you just mentioned, and to ensure that they're doing good
38:02
risk assessments and they're following through on those to
38:04
make sure they're mitigating the biggest risks in their programs.
38:07
Miss Kozilek, any further comments?
38:12
Yeah. So as as you mentioned,
38:13
prevention is really the key in this and having the right data.
38:18
So artificial intelligence can be helpful if you have the right
38:22
data in the system. So we do have recommendations to
38:26
encourage agencies to collect all the necessary information
38:31
that is needed to ensure the databases are complete, that
38:35
they're accurate. If you're using artificial
38:38
intelligence and other data mining mining tools, but you
38:41
have inaccurate or unreliable data in the systems, that is not
38:46
going to be very helpful. Thank you, Mr. Chairman.
38:48
I yield back. Thank you very much.
38:51
Shell woman yields factors time, Mr. Mfume Jones recognized.
38:57
Thank you again, Mr. Chairman. I'm got a couple of quick
39:00
questions. I know we were a smaller
39:02
committee and I'm hoping that we might even get a second round.
39:05
And I want to obviously defer to both of the members here on my
39:08
side of the aisle. I do want to be redundant, maybe
39:13
deliberately redundant about a few things.
39:16
Number one, I appreciated the testimony that nearly all
39:20
Medicare and SNAP recipients are eligible for benefits, which
39:25
would explode the myth that's been circulating that people are
39:28
getting things that are not eligible.
39:30
I want to under score again, what I heard was that most
39:34
improper payments are due to paperwork, paperwork errors and
39:38
not necessarily conniving persons trying to find a way to
39:42
get a a check. However, what I think I want to
39:49
stop on more than anything else is the notion that was just
39:52
enunciated that we've got to stop it before it starts.
39:57
And Mr. Diefenbach, I appreciate your comments that we can't play
40:00
the game of of pay and chase that will go on forever deplete
40:05
resources and frustrating everybody.
40:09
I do want to ask if the 10 ready recommendations that you.
40:15
Presented in your Senate, testimony can be made available.
40:18
I don't know that I have them, but I'd, I'd like very much to
40:21
see them. And one overarching question.
40:24
And then I'm I'm going to get out of the way and yield to some
40:26
of my colleagues. Mr. Chairman, can all of you,
40:31
individually or collectively give me your assessment of what
40:36
has happened and what will happen now that all these
40:39
inspector generals are no longer in place to do the good job that
40:43
they were doing? To point out the crooks and the
40:46
bad guys and follow up with bodies like this, both in the
40:49
House and Senate that would allow us the ability to do what
40:53
we've been able to do in a bipartisan way?
40:54
I just, I need, I know, I think what the effect is, but I need
40:58
to hear it from the three of you, any of you.
41:03
Sure, I can start. So certainly the Inspectors
41:06
General play a key oversight role.
41:08
They have responsibilities related to improper payments.
41:13
Beyond that, they do audits of the programs day in and day out
41:18
and can be very helpful in identifying some of the root
41:21
causes that may lead to improper payments in the programs.
41:24
And then also they are really helpful in coming up with
41:30
solutions once they identify those root causes, identifying
41:34
recommendations that the agencies can take.
41:37
So certainly the lack of their lack of their presence in some
41:42
of the agencies would have a significant impact on.
41:47
And in many of the agencies, and I'm, I'm just trying to figure
41:49
out now that they're gone, what do we do?
41:52
I mean, what's, what are agencies faced with?
41:55
And is there a greater propensity for the kind of fraud
42:00
and abuse that we've seen? So Congressman of whom may the,
42:05
the loss of the inspectors general was a great loss on a
42:07
leadership level, on a, on a productivity level.
42:10
Our vice chair of the prac, Paul Martin was the USAID Inspector
42:13
General who's dismissed and we we greatly miss his leadership.
42:16
I think the biggest thing for the Congress is you're going to
42:18
have less transparency, less visibility on what's actually
42:22
occurring in agencies, because that's one of the the hallmark
42:24
principles when Congress set up the Inspector General Act was to
42:27
give you and the taxpaying public more visibility and
42:31
transparency on an objective view of what exactly is going
42:33
on. So I think you're going to have
42:34
reduced visibility. Miss Wagner.
42:37
And just to add an example to what my colleagues have said
42:39
here, the HHSOIG is really important in supporting and
42:43
funding state Medicaid fraud control units that investigate
42:47
and prosecute Medicaid provider fraud.
42:49
As I indicated, beneficiary fraud is very low in this these
42:52
programs, but provider fraud is common.
42:56
In FY23, these units recovered $1.2 billion in criminal
43:00
penalties and civil judgments and also the IGS and HHS would
43:06
in audit eligibility determination processes.
43:10
And they were very effective in identifying major issues in
43:12
states such as duplicate payments to managed care
43:15
organizations in incorrect interpretations of federal
43:18
policy and caseworker errors. So identifying these problems
43:21
and working with them, working with the states to get them
43:23
addressed is really a key role that is diminished right now.
43:27
Yeah. I think it would be fair to say
43:28
that their dismissal has clearly exacerbated a problem that is
43:34
clearly out of control now. Mr. Chairman, I yield back.
43:37
Thank you very much. Let me ask you question.
43:41
Question. One moment please, Sir.
43:43
Thank you very much. Does gentlemen have a question?
43:46
Well, no, I just, I was wondering if I could yield Mr.
43:49
Mafumi a minute of my time. I was.
43:52
Enjoying his line of questioning.
43:53
As soon as we get to you, I bet he will take that and even more.
43:58
OK. I just want to make sure I
44:00
didn't. I'm sorry.
44:00
Yes. Sir, as the gentleman does know,
44:04
the Chairman wants us to get to the bottom of this, and I do not
44:08
intend to cut us off. As long as we're staying in the
44:12
margins, I think we're better off.
44:14
I think we're better off when Someone Like You does yield time
44:18
to learn more about what's on someone else's mind.
44:20
Thank you very much. I've now moved to No, you're
44:23
great, you're great. I'm just saying I do want to.
44:26
When we get to the gentleman, Chairman Palmer is recognized.
44:31
Thank you, Mr. Chairman. Mr. Kosilek.
44:37
In 2002, Congress passed Improper Payments Information
44:40
Act. In 2010, Congress passed the
44:44
Improper Payments Elimination and Recovery Act.
44:47
In 2012, Congress passed two more bills, the Improper
44:50
Payments Elimination Recovery Improvement Act and the Improper
44:53
Payments Transparency Act. Yet GAO said that the federal
44:59
government's losing between 233 to 521 billion per year.
45:04
If you just split the difference, that's $377 billion
45:08
over a 10 year, 10 year window, that's 3.7 trillion not counting
45:12
the interest that we're having to pay.
45:14
And in regard to the Inspector general's, it sounds like we're
45:24
not going to miss Inspector General.
45:26
I, I don't mean to be dismissive that I, I have great high regard
45:29
for the Inspector General's, but in terms of actually lowering
45:33
our improper payment rate, we, it's, it keeps going up year
45:38
after year. How do you explain that?
45:42
Oh, sorry, I'm looking at the wrong person.
45:44
I can't, I need to sit up straight so I can see the names.
45:50
OK, go ahead. I think we really need to get
45:53
back to basics and having internal control in payment
45:59
processes. As you noted, there's been
46:03
numerous amounts of legislation adding on requirements,
46:07
reporting improper payments. But we really need to get back
46:10
to the fundamentals of having internal controls in payment
46:14
processes, understanding what the root causes are for the
46:17
improper payments going out and focusing on on that, requiring
46:23
agencies to report their plans for prevention to you and having
46:27
accountability for having those prevention plans in place.
46:31
Isn't the problem though, the here the failure to have
46:37
enforcement in any of these bills there?
46:39
I, I've been working on since I've been in Congress.
46:42
I believe I, I might have been the first one to, to get the
46:44
Budget Committee to, to really take into account and proper
46:47
payments and working with the, with Mr. Dodero this whole time
46:51
on it. And it, it's, it's not getting
46:54
better. As a matter of fact, there's in,
46:56
in fiscal year 24, there's 16 agencies that reported a total
47:00
of about $162 billion and improper payments.
47:04
And when you, when you dig down into it, about 5455% of the
47:10
improper payment problem is administrative air, failure to
47:13
verify eligibility and antiquated data systems.
47:17
Which brings me to Mr. Musk and I, I know there's a lot of
47:20
consternation about what they're doing, but literally he's
47:25
brought in some, some computer experts with 21st century
47:28
technology and done better oversight of, of the federal
47:31
government in the last six weeks and we've done the last 40
47:34
years. I mean, isn't that one of the
47:38
biggest problems we have with improper payments is we've got
47:40
antiquated data systems? We don't we don't have the 21st
47:44
century technology. We need to do oversight, proper
47:46
oversight. Having reliable data is is very
47:50
important. Having accurate, reliable,
47:52
complete data in the systems to be able to do those integrity
47:56
checks is is critical, yes. Well, after we did pass the
48:00
Improper Payments Elimination Recovery Improvement Act, and I
48:03
know of one outside company that was brought in that did some
48:07
analysis of, of Labor Department of Labor contracts and found
48:12
millions of dollars in fraud under overpayments, other monies
48:18
that should have come back to the federal government through
48:20
credits that were not recovered. And, and when this was
48:24
disclosed, the Department of Labor at that time basically
48:28
waved off as disinterested. Isn't that a problem?
48:32
The pay and chase model is a problem.
48:34
Trying to recover the payments after the fact is much less
48:38
effective. That So what we need to do is
48:41
focus on stopping it on the front end and that's where where
48:46
we need the improvements in technology, where we need the
48:49
investment in technology. And this is a huge issue when
48:55
when you're reporting 16 agencies are accounting for 162
49:00
billion ten year window, that's $1.6 trillion and we're running
49:06
a deficit of over 2 trillion every year.
49:08
If if you just look at the the totality of it, 3.77, 377
49:13
billion, that's 3.773, not counting the interest we're
49:16
paying on that money because every dollar we send out
49:19
improperly is a borrowed dollar. Mr. Chairman, I yield back.
49:26
At this time, thank you very much as things gentlewoman from
49:29
Washington DC is recognized. Thank you, Mr. Chairman, for
49:37
days. Just days after he took office,
49:41
the President Trump summarily fired 17 inspectors general
49:47
across 18 positions in the dead of the night.
49:53
Inspectors generals fulfill a vital oversight and
49:57
accountability function in the government, including through
50:00
identifying and preventing improper payments.
50:04
I GS are also responsible for keeping Congress informed of
50:09
fraud and other serious problems and informing us about progress
50:14
in implementing solutions. As we consider, as we consider
50:22
ways to attack the problem of improper payments, it is
50:27
critical that we do not undermine these officials who
50:31
serve as our partners in this fight.
50:34
Miss Wagner, I am aware that much of your work has focused on
50:40
the challenges that states may have in complying with complex
50:45
requirements for federal payments program programs.
50:50
How do inspectors general help to identify and address these
50:55
problems? Inspectors general play a
50:59
critical role in auditing state operations.
51:02
States are trying to run an accurate program, but they have
51:04
many pressures on them and they sometimes make mistakes in their
51:07
policy and their operations and their systems.
51:09
And audits through inspectors general and others come in and
51:12
identify these mistakes and lift them up and hold the state
51:15
accountable for addressing these.
51:17
So it's really a critical role. And we're looking to improve
51:20
improper payments and to get benefits to eligible people.
51:24
Thank you Miss Co Select How does the firing of Inspectors
51:33
General Inspector General affect Inspector General Office's
51:40
ability to prevent and address improper payments?
51:46
The, the role the Inspector General plays is critical.
51:50
One of the other things they're they're often the first line of
51:53
defense in investigating allegations of fraud and
51:56
improper payments. So without having, you know,
51:59
strong Inspector General presence in there, that could,
52:01
that can certainly be an impediment.
52:05
They're also an objective voice in identifying problems and
52:09
doing investigations. So certainly having a very
52:13
strong Inspector General role is critical.
52:16
Inspectors general are rigorous evidence based use rigorous
52:24
evidence based approaches to target fraud.
52:29
This import this is important because a reckless approach to
52:35
fighting fraud risks collateral damage.
52:39
It could keep general federal assistance from from from going
52:46
to those who most are in need of it.
52:50
GAO's Fraud Risk Management Framework notes that agency
52:56
should consider the cost of fraud controls when designing
53:03
systems, including potential delays for a legitimate
53:09
applicants. Miss Koseley, how does the work
53:14
of Inspectors General ensure that people get the benefit for
53:20
which they are eligible? Certainly the the role they play
53:26
in in a doing the various program audit.
53:28
So certainly they have a role in improper payments, but they also
53:31
as I mentioned, you know do program audits throughout
53:35
throughout the year. Looking at the operations of the
53:38
various programs, are they being executed efficiently and
53:42
effectively to make sure that the proper recipients are
53:47
receiving the benefits that they are entitled to?
53:51
Mr. Dieffenbach, the Inspectors General serving on the Pandemic
53:57
Response Accountability Committee have done great work
54:02
in identifying improper payments throughout our pandemic
54:06
response. What has been the impact of
54:11
President Trump's purge of so many inspectors general been on
54:19
the committee's work and capacity going forward?
54:23
Well, we have lost again the leadership, the institutional
54:25
knowledge of individual inspectors general, but the
54:29
offices of inspectors general still exist and are fully
54:32
functioning. We work with them day in, day
54:34
out on investigations and we are of course, an independent
54:38
committee within the oversight community, the PRAC that does
54:41
operational data analytics literally every day to support
54:45
investigations, to proactively find problems and to issue
54:48
reports on lessons learned and preventative measures that
54:51
agencies can follow going forward.
54:53
So we are continuing to do our important work to support the OI
54:57
GS and to be a centralized hub, if you will, for analytics to
55:03
support the OI GS that are smaller.
55:04
They don't have their own capabilities.
55:06
Thank you and I yield back. Thank you very much, the
55:11
distinguished old woman. We're delighted that you're
55:13
here. And as you have proved in your
55:16
service, we all want to as well. Mr. Infamain, your side want to
55:21
stop improper payments and move to the areas that they would be
55:26
needed. We now would move to
55:29
distinguished gentleman Mr. Gill from Texas.
55:31
You're recognized. Thank you, Mr. Chairman.
55:35
Thanks for holding this hearing today.
55:38
Miss, Miss Co Select, thank. Thank you for being here as
55:41
well. Could could you remind us in
55:43
fiscal year 2024 what was the the amount of improper payments
55:49
that were sent out? $162 billion.
55:54
OK. And and which agencies were the
55:56
were primarily responsible for that?
56:00
Some of the programs that had the largest dollar amounts were
56:04
Medicare, Medicaid, Earned Income Tax Credit, some of the
56:09
larger ones. And, and how much do you guys
56:13
at, at the GAO estimate we lose in fraud every year?
56:18
We did a fraud estimate for looking at data for years 2018
56:22
through 2022 and we came up with an estimate of 230 to $250
56:27
billion. In in what agencies do you
56:30
primarily see fraud? That estimate was based across
56:34
all programs. OK, got it.
56:37
So if I'm in let's just use a a specific example.
56:41
If I'm a a fraudster and I want to collect unemployment checks
56:45
that that I shouldn't be receiving and I steal somebody
56:48
else's identity to do that, and I apply and apply to the
56:53
Department of Labor, what are the processes that that you
56:56
would expect to see the Department of Labor go through
56:59
to ensure that I don't improperly or fraudulently
57:02
receive a check? So unemployment insurance is an
57:06
interesting one. It's a federal state partnership
57:08
program. So there are responsibilities at
57:10
the federal level. And at the state level, as I
57:13
mentioned, really having those preventative controls in place,
57:16
doing those data matching checks are some of the the key controls
57:21
that you could expect to see to have an entity have in place.
57:24
And in this case, you need to have those types of controls in
57:27
place at the state and at the federal level.
57:28
What? What do we actually see on a on
57:31
a on a realistic basis? How?
57:33
How often are some of these checks actually applied?
57:36
We have seen instances and had recommendations for
57:40
unemployment, I believe where there could be additional use by
57:44
the states of some of those data checks.
57:47
And I believe we have some recommendations that there could
57:50
be requirements to have the states be required to do that
57:54
data match. Right now it's encouraged, but
57:57
there are, we have found instances where in all cases
57:59
that is not being done and that can be a root cause of some of
58:02
these improper payments. So, so in other words, we're
58:05
we're mailing out checks without verifying who they're going to.
58:08
In some cases. Got it.
58:10
And and what are the consequences for agency heads as
58:14
they're mailing out American taxpayer dollars without without
58:17
verifying who they're going to? The consequence is that the
58:22
anytime there's improper payments or fraud or money going
58:25
out for not the intended purpose, that's money that could
58:29
be going to rightful recipients and used for other purposes.
58:32
Right. But I mean from a, from an
58:33
incentive standpoint at at on the agency level, is there any
58:37
consequence for for either employees at the agency or
58:40
agency heads for mailing out checks fraudulently?
58:44
One of the things we have recommended is having an
58:48
accountable official at the agencies.
58:50
As opposed to the recommendations right now, are
58:52
there? Is there anything to hold these
58:54
people accountable? Agencies are supposed to have an
58:57
accountable official to to but we've.
59:01
But but what? What is the accountability
59:03
structure? Do they do they receive less
59:06
bonuses? For instance, are they fired?
59:09
What it What is the? What's holding them accountable?
59:11
I think that is determined by the agency as to how that
59:14
mechanism is, is 100% set up. But certainly Congress can have
59:19
accountability. Mechanism.
59:20
What do you see? Do you see?
59:21
Have you ever seen an agency head get fired, for instance,
59:24
for mailing out billions of dollars in fraudulent checks?
59:27
I have not seen that. Got it.
59:29
OK. And once we once we mail these
59:32
checks out, is there any way to of clawing this money back and
59:36
and holding the fraudsters accountable?
59:39
That's what you're saying that the pay and chase model is is
59:41
not generally effective. There are requirements that
59:45
anytime there is an improper payment, agencies are supposed
59:48
to attempt to get that money back.
59:51
But we have found that the percentage that you get back
59:54
when you're when you're following that model as opposed
59:56
to not having to go out preventing it, is, is by far
1:00:00
much more effective. Right, right.
1:00:01
Completely agreed. I mean it.
1:00:03
It seems to me that we've got a an overextended, bureaucratic
1:00:07
administrative leviathan that is mailing out American taxpayer
1:00:11
dollars fraudulently with virtually no and no
1:00:15
accountability at all, bankrupting the American people
1:00:19
with impunity. And this is from a federal
1:00:22
government that ostensibly works in the interests of American
1:00:26
citizens, is instead wasting our taxpayer dollars on a on a scale
1:00:32
that is difficult to fathom. I think this is precisely why we
1:00:36
need those so badly to get this nonsense under control.
1:00:41
And with that, Mr. Chairman, I yield back and thank you very
1:00:43
much. Appreciate the gentleman's
1:00:46
questions. The distinguished gentleman from
1:00:49
Washington, Miss Randall, is recognized.
1:00:53
Thank you so much, Mr. Chair, and thank you as well to our
1:00:57
witnesses for taking the time to be here today and share your
1:01:01
expertise. You know, I've been pretty open
1:01:05
about sharing my sister Olivia's story.
1:01:08
She was born with really complex disabilities and was able to
1:01:11
receive the care she needed because of Medicaid.
1:01:15
And she was one of an estimated 2.4 million Washingtonians
1:01:19
enrolled in Apple Health, our state Medicaid program.
1:01:23
And so ensuring that we are protecting that program is, is
1:01:27
very important to me, not just personally, but on behalf of all
1:01:31
my constituents. And I think I share the goals of
1:01:38
so many of my colleagues here to ensure that we are using
1:01:43
taxpayer dollars efficiently to provide essential services to
1:01:48
our neighbors who need them. But what we may have some
1:01:52
disagreement on is how to make the federal government and our
1:01:57
programs work better for the American people.
1:02:01
You know, my colleague talked about fraudsters and certainly
1:02:08
there is some fraud in some of our programs, some improper
1:02:12
payments, but I think what we also have to under score is the
1:02:20
individual people that are trying to access these programs.
1:02:25
And we had a subcommittee hearing on healthcare and
1:02:29
financial services a week or two ago in which we collectively
1:02:34
bipartisanly discussed and understood the barriers that
1:02:37
exist for many families trying to access Medicaid, including
1:02:40
and especially those married couples that have a hard time
1:02:43
getting the healthcare that they need to be successful.
1:02:47
But I want to reiterate the difference between fraud and
1:02:54
people perpetuating fraud and the improper payments.
1:02:57
And Miss Wagner, could you reiterate, is it true that the
1:03:04
vast majority of of improper payments are paperwork issues,
1:03:08
not fraud? Yes, that is correct.
1:03:10
It's usually a mistake in the process.
1:03:12
When you talk about a program like Medicaid, it could be an
1:03:15
mean and eligibility worker didn't follow correct procedures
1:03:18
or the participant was issued the wrong amount of benefits.
1:03:21
But it's often an error and inadvertent error by the
1:03:24
household or a mistake by the agency staff or system.
1:03:27
The incidence of fraud, which is intentional to seek to gain a
1:03:30
benefit, the incident of beneficiary fraud is very low on
1:03:34
these programs. Yeah.
1:03:35
Thank you. You know, you know, I
1:03:39
experienced in my family and heard so many anecdotes from
1:03:43
Washingtonians, particularly parents of severely disabled
1:03:47
children who have this like, stack of paperwork on their
1:03:51
counters, who feel like they need to be attorneys in order to
1:03:57
access a system to provide healthcare for their kids.
1:04:00
And who are overwhelmed so often with late nights, little sleep,
1:04:06
worry about what, you know, new medication their kids need to be
1:04:10
on, what specialist appointment they need to get into.
1:04:12
Who spends so many hours on the phone appealing denials of
1:04:17
claims, trying to get into an appointment with someone, trying
1:04:22
to get answers for their kid and take care of them while many of
1:04:25
them also have another day job? This, you know, to characterize
1:04:32
these parents as fraudsters or to try and lump in, you know,
1:04:37
individuals who are just trying to stay alive in so many cases
1:04:42
feels really challenging to me. And, you know, I talked to the
1:04:47
healthcare authority in Washington, our agency
1:04:50
responsible for administrating Medicaid.
1:04:53
And because of Washington's fraud abuse detection system,
1:04:58
which I supported funding for as a member of the state Senate,
1:05:02
they have uncovered 35 to 40 credible allegations of fraud.
1:05:07
That's 35 to 40 out of 20 million claims that they receive
1:05:12
a year. And to do that math for us, it's
1:05:15
.0002% of fraudulent claims. And, you know, none of us are
1:05:21
claiming that no fraud exists. But I think we need to keep in
1:05:25
mind the scale of the problem here and who is perpetrating the
1:05:32
incorrect payments. I also want to raise one thing
1:05:38
that the Health Care Authority suggested might be helpful as we
1:05:41
talk about efficiencies in government.
1:05:43
And they said that there is a a federal system to which they, as
1:05:49
states, don't have immediate access to understand whether
1:05:52
folks are concurrently enrolled in Medicaid programs from one
1:05:56
state to the other. I know you know, there is.
1:06:01
We will have in the next couple of years some changes to that
1:06:06
database to monitor when someone moves and changes their address.
1:06:11
But it doesn't allow agencies like the healthcare authority in
1:06:14
Washington to track whether there's concurrent enrollment.
1:06:17
And that would be something that I'd love the chance to work on
1:06:19
with my colleagues and I yield my time.
1:06:25
Joe Woman yields back her time. Thank you very much.
1:06:28
We've moved to distinguished gentleman from Tennessee, Mr.
1:06:31
Burchett. Thank you, Mr. Chairman, and
1:06:33
thank you, ma'am, for sharing that story about your sister.
1:06:36
I did not know that. That gave me a lot to think
1:06:39
about. Miss Koshiya Lek.
1:06:43
Is that correct? And I get that close.
1:06:45
You got Kwas and the Fumi and Tim Burchett up here.
1:06:47
We can. Nobody gets our names right.
1:06:49
And I probably didn't get his name right.
1:06:50
So let me ask you a question, ma'am.
1:06:53
If I can see through this big head of hair right here in front
1:06:55
of me, what, what are some of the key issues that prevented
1:07:00
these agencies from prioritizing prevention of improper payments
1:07:03
and fraud? And I wish you'd also talked a
1:07:07
little bit about just human error, how that plays into this.
1:07:12
Yeah. So there's something that can be
1:07:14
human error and I just want to clarify the fraud to be sure,
1:07:18
fraud is a big problem. The fraud numbers that we
1:07:23
estimated over those years was about 3 to 7% of of the funding.
1:07:30
But to be sure, as we noted, you know, any amount of fraud is, is
1:07:34
money not going to the intended purpose.
1:07:36
So some of the key issues I think that prevent folks from
1:07:42
being able to effectively put the right controls in place does
1:07:47
have to do with some data sharing, some access, having
1:07:52
truly understanding the eligibility requirements, the
1:07:59
data attributes that should be checked and then having that
1:08:02
right information to be able to do that.
1:08:05
Checking to make sure that the payments are valid.
1:08:08
Going to the right person is really what's critical and can
1:08:12
be some of the key challenges and issues that agencies face.
1:08:15
The agencies in 2024 fiscal year 2424, they collectively
1:08:20
estimated approximately 161.5 billion in improper payments.
1:08:25
Do you think Congress can can get to the point where we can
1:08:27
stop that? I think the goal is to reduce
1:08:31
that. You'll probably never get rid of
1:08:34
the risk of fraud. It's innate in all programs.
1:08:37
But there should be a concerted effort to have that as low as
1:08:40
possible and and have the right preventative controls in place
1:08:44
to not leave so much money on the table to that.
1:08:46
I guess in this case it's the original sin, so to speak, Yeah.
1:08:51
How many agencies and programs are using the GA OS fraud risk
1:08:56
framework now? And why aren't they using it?
1:09:00
The ones that aren't just. You know, I don't know if we
1:09:03
know the, the, the true reason why not all of them are using
1:09:07
it. We do certainly have a
1:09:09
recommendation to Congress to require agencies to use that.
1:09:14
We think it's a critical. And and they're currently not
1:09:17
required. They're not required to follow
1:09:19
that. Not specifically.
1:09:22
OK. Thank you.
1:09:25
What can we do to enable that these agencies recover over
1:09:29
payments or are they just gone? I always hear people say, oh,
1:09:32
we're going to call that back. I was in the legislature in
1:09:35
Tennessee for 16 years and I never saw.
1:09:38
I mean, it's hook or crook, you know, it's a bogus corporation
1:09:42
or something, got money somehow or some criminal and they're in
1:09:47
jail. They're not paying it back.
1:09:48
They're getting $0.20 an hour stamping out license plates.
1:09:54
And that's the challenge. In many cases, it's not easy to
1:09:58
get that money back. OK, Thank you.
1:10:00
I need and I want to yield the rest of my time to my dear
1:10:03
friend, Mr. Mafumi, if that's all right.
1:10:05
Thank you, Mr. Chairman. Well, I want to thank the
1:10:09
gentleman for yielding. Totally unnecessary, but you're
1:10:12
not making any points calling me a gentleman.
1:10:16
Mr. Burchett and myself were like a guitar and a fiddle.
1:10:20
We both have strings, but we make different sounds and we've
1:10:26
worked together whenever we can. Usually we're 100% on different
1:10:30
sides of the aisle, but at moments like this, on something
1:10:32
like this, I appreciate the gentleman for yielding,
1:10:35
appreciate his sense of humor and the ability to work with
1:10:39
him. I do want to just go to two
1:10:41
quick things that I heard that I don't want to have fall to the
1:10:45
wayside and get out of the way for the other members,
1:10:48
particularly Mr. Frost on our side and whoever, Mr. Chairman,
1:10:51
you have next. Coming up, Mr. Palmer made a
1:10:55
good point, and I'm really sad that he's not here because he
1:10:59
talked about this whole enforcement mechanism and
1:11:03
whether or not there is any enforcement mechanism.
1:11:06
And without an enforcement mechanism, how can you expect
1:11:10
agencies or agency heads to do anything at all if we're not
1:11:14
going to enforce existing law or practice?
1:11:18
And the other interesting thing was Mr. Gill mention
1:11:23
consequences to agency heads, which I think is something that
1:11:27
we ought to talk about, particularly the flip side of
1:11:30
that, which is incentives to agency heads.
1:11:34
And I don't know if we are providing them right now.
1:11:37
So if I'm running agency AB or CI, see a problem and I work my
1:11:43
tail off to get it fixed so that improper payments are not going
1:11:46
out, seems to me there ought to be some incentive there for
1:11:49
agency heads to do that. And there ought to be a hammer
1:11:52
on the other side for agency heads who fail to do it at all.
1:11:56
So I just wanted to go back to both of those points.
1:11:58
I want to thank the the gentleman, I'll call him a
1:12:01
gentleman again from Tennessee, Mr. Perchard, for yielding this
1:12:04
time. And I yield back, Mr. Chair.
1:12:09
Mr. Bircher yields back his time.
1:12:11
Thank you for the distinguished gentleman.
1:12:13
We'd now recognize the seniors gentleman from Georgia, Mister
1:12:17
Jack. Thank you very much, Mr.
1:12:19
Chairman. And first and foremost, if I
1:12:21
could follow on that effective line of of of statement from Mr.
1:12:25
Mufume and that potential line of questioning.
1:12:28
I was also inspired by Mr. Palmer's statements as relates
1:12:32
to enforcement. If I could just go down the the
1:12:34
line, what say you about enhancing the enforcement
1:12:37
capability, whether through legislative action or executive
1:12:40
action? Yeah.
1:12:44
So I think holding people accountable is critical for
1:12:49
doing anything. But in this case particularly,
1:12:52
certainly I think agencies should have accountable
1:12:56
officials and hold those people accountable.
1:12:58
And like I mentioned, Congress can have an accountability role
1:13:01
too, through the appropriations process, through having agencies
1:13:08
and and officials report on their preventative controls that
1:13:13
they're putting in place to hold them accountable and demonstrate
1:13:16
how they are doing that. Thank you, Mr. Difenbach.
1:13:19
Thank you for the question. So we spent the last five years
1:13:22
at the prac developing and learning lessons learned.
1:13:26
We put out a program for Blueprint for program integrity.
1:13:30
So agencies need to to operationalize that and follow
1:13:32
that. We have perfected ways to find
1:13:35
simple frauds and more complex frauds.
1:13:37
So I think one of the answers is they need to have the tools to
1:13:40
be able to detect again the simple non eligibility issues,
1:13:43
but also the more complex hidden criminal enterprise, sometimes
1:13:46
International Criminal enterprises, which we've done a
1:13:48
good job, I think a phenomenal job of of finding new ways to do
1:13:51
that with big data. One of them Miss Wagner.
1:13:54
The key to preventing improper payments, reducing fraud is
1:13:57
information and technical assistance to the states.
1:13:59
States are trying to run a good program.
1:14:01
They don't want headlines, they don't want their their money
1:14:04
going to the wrong people. And so by supporting them in
1:14:06
these efforts with funds, with federal support, we can go much
1:14:09
further penalizing them. Massive cuts to these programs
1:14:13
will actually go against this purpose and will lead to
1:14:15
increased improper payments. Thank you all just for in
1:14:20
closing, a lot of my colleagues have asked very effective
1:14:22
questions today, but I love history and I would love if I
1:14:26
could miss Kosciolek. I think we've, we understand
1:14:31
since 2004, 2003, we've seen 2.8 trillion in improper payments.
1:14:34
I think that's from GAO. Is that correct?
1:14:37
And would you say has there been an influx in recent years if you
1:14:40
were to try to catalog year by year?
1:14:42
I mean, it's trying to understand the history of of of
1:14:45
how this ramped up. And, you know, is this something
1:14:47
that was happening the 40s, fifties, 60s?
1:14:49
Have you seen it just really skyrocket as government's grown
1:14:51
and government programs have grown?
1:14:53
Would love for you to just offer some thoughts on the history of
1:14:55
how we got here. Yeah, I think certainly some of
1:14:59
the challenges and and as we mentioned, the importance of
1:15:03
having really foundational good internal controls is critical so
1:15:07
that over the years as emergencies are going to arise,
1:15:13
you have those foundational controls in place, you have
1:15:16
plans and controls ready to go. I think, you know, as agencies
1:15:20
and the government is forced to function in dynamic ways, if you
1:15:25
don't have those foundations in place, that's when I think you
1:15:29
see that fluctuation and that just exacerbates the problem.
1:15:33
Sir, if you want to comment on the history of how we got here.
1:15:35
Please. The threat is always evolving.
1:15:38
The friction for getting public benefits is gone.
1:15:40
Anyone with a computer anywhere in the world can apply for
1:15:43
public benefits. Some of those programs have a
1:15:45
lot of protections in place as we found a pandemic for our
1:15:47
work. Many did not.
1:15:49
So it really takes a big data approach using all the tools
1:15:53
available to find the hidden connections that you can't find
1:15:55
manually. We're working on, we're aware of
1:15:57
142,000 known pandemic fraud cases and they have a
1:16:02
fingerprint. And we've been able to figure
1:16:04
out that fingerprint. And our hope is to be able to
1:16:05
continue our work to help people proactively defend against these
1:16:09
things and prevent them early, because you cannot fight today's
1:16:13
fraud issues with yesterday's tools.
1:16:15
Wonderful Miss Wagner. So Medicaid and SNAP are a
1:16:22
little bit different than some of the other programs that are
1:16:24
more recent or were really ramped up during the pandemic.
1:16:27
They have a long history of working to reduce improper
1:16:29
payments. They were challenged during the
1:16:31
pandemic by some new programs, by increased demand and by
1:16:35
reduced staffing. So now we really need to kind of
1:16:37
look at the other side of that and stabilize the workforce,
1:16:40
improve the IT systems to continue reducing those rates.
1:16:43
I'd like to thank all three of the witnesses for appearing
1:16:45
before us today. I want to thank the Chairman for
1:16:48
calling this hearing. And with that, I yield my
1:16:50
remainder 30 seconds to the Chairman.
1:16:51
Thank you. Appreciate the distinguished
1:16:54
gentleman and welcome him not just to the subcommittee but
1:16:58
really to Congress with an eye towards as a new member as well,
1:17:05
some other people, including Mr. Frost.
1:17:07
Mr. Moss was making sure that their words that they say back
1:17:13
home are met with the reality of other senior members working
1:17:19
with you to achieve those things.
1:17:21
And I think that that's the sense that I get that it's a
1:17:25
100% buy in that we have about the problem.
1:17:30
Mr. MFU Mayor, want to come to a 100% working towards that answer
1:17:36
and I want to thank the distinguished gentleman.
1:17:39
Thank you, Mr. Chairman. The same gentleman from Florida
1:17:44
is recognized. And good to see you, Mr. Frost.
1:17:46
Thank you. Thank you.
1:17:47
Thank you, Mr. Chairman. Hello.
1:17:50
Thank you so much for for being here today.
1:17:52
You know, when I was back home and in the District over the
1:17:54
weekend, everywhere I went to grocery store, walking around
1:17:57
the park, doing anything, people were coming out to me asking
1:18:00
about Social Security. And I think a lot of people are
1:18:03
worried and scared right now. I think part of it has to do
1:18:07
with a lot of the myths and disinformation that's going
1:18:10
around. I mean, we've heard this
1:18:11
constant lie from Elon Musk that 10s of millions of dead people
1:18:17
are getting Social Security paychecks.
1:18:21
Claiming fraud. And Social Security, I think is
1:18:22
one way that folks are going to justify cutting it, pocketing
1:18:26
the benefits for billionaires, privatizing it.
1:18:30
Miss Kosilek, Elon Musk is now calling Social Security a Ponzi
1:18:35
scheme. How concerned are you that
1:18:37
Social Security is a Ponzi scheme?
1:18:42
I don't think we have seen indications in our work that
1:18:45
that is the case. Musk is calling it a Ponzi
1:18:49
scheme as an excuse to destroy it.
1:18:51
In my opinion, Americans earn Social Security, three years of
1:18:54
hard work, and it's a good investment.
1:18:56
It could be a better investment for Black men because we're
1:18:59
pretty much donors because we live less time.
1:19:02
But that's another conversation for another time.
1:19:04
It's one of the most popular government services.
1:19:07
And most people support more funding for Social Security, not
1:19:10
less. Miss Wagner, You know, people
1:19:12
want shorter wait times, payments processed more quickly.
1:19:16
But at the same time, the administration wants to cut 7000
1:19:20
employees from the administration.
1:19:22
Yesterday somebody from my office called Social Security 30
1:19:26
days to process something on retirement, 30 days on Medicaid,
1:19:29
230 days as it relates to disability.
1:19:33
What would be the effects of these cuts to the Social
1:19:36
Security Administration right now?
1:19:38
When staff shrinks, there are fewer people to take
1:19:40
appointments, to answer phones, to process applications for
1:19:43
different benefits, and that hurts people nationwide.
1:19:46
And in addition to their own staff, Social Security
1:19:48
Administration funds state Disability Determination Service
1:19:52
employees who decide whether applicants disabilities are
1:19:55
severe enough to qualify for benefits.
1:19:57
Their processing time was already at a record high of
1:20:00
seven months, and we expect cuts will have further impact.
1:20:04
In addition, 7 in 10 of Social Security staff do serve the
1:20:07
public directly, so this will. Will have a major impact on
1:20:09
customer service. Thank you.
1:20:12
It's and it's not just, you know, billionaires like Elon
1:20:14
Musk who are going around attacking it.
1:20:16
My own Florida Senator, Rick Scott, the richest person in
1:20:19
Congress, which on the topic of fraud, you know, my senator made
1:20:22
history. He's the man responsible for the
1:20:25
largest Medicare fraud in the history of this country, $1.7
1:20:28
billion. He says that Republicans are
1:20:31
going to have to cut Social Security and quote, why are they
1:20:35
doing this? Well, to take money from Social
1:20:37
Security to use it for tax cuts for people who are too rich to
1:20:40
need it. House Republicans plan to make
1:20:43
$880 billion in cuts to healthcare.
1:20:46
This means cuts to Medicaid and Medicare, too.
1:20:48
Miss Wagner, Four and eight American children are Medicaid
1:20:51
recipients, including over 60,000 people in my district
1:20:55
alone. For an Orlando family currently
1:20:58
receiving Medicaid, what could be the financial fallout from
1:21:01
losing access to Medicaid? Well, first, when states are
1:21:05
forced to cut back on funding, they are going to cut back on
1:21:08
who's eligible and the benefits they receive.
1:21:10
But cuts will have broader impacts than just those who are
1:21:13
no longer eligible. They will directly or indirectly
1:21:16
affect the amount of funds available for state staff, for
1:21:19
IT systems that support Medicaid.
1:21:21
And they'll probably lead to more improper payments and
1:21:23
reduce program integrity. And it will impact people who
1:21:26
even whose eligibility isn't cut longer call center wait times,
1:21:30
more errors, uncertainty, stress, and possibly not be able
1:21:33
to get approved for benefits or losing coverage at renewal even
1:21:36
though they remain eligible. Thank you.
1:21:38
You know, before coming to Congress, I worked in
1:21:41
organizations and one of the proudest things I did was work
1:21:44
at March for Our Lives. They came after the shooting
1:21:46
that happened in Parkland. I traveled this country speaking
1:21:50
with people that disagreed with me on the issue of gun violence.
1:21:53
But it made me a better person. And something I learned during
1:21:56
my travels is in order to speak about something in a bipartisan
1:22:01
way, I think it's really important to make sure people
1:22:04
are coming at this on the right foot in good faith.
1:22:08
And I'm all for the modernization of our government.
1:22:11
I think it's really important. And I say that's the youngest
1:22:13
person in the United States Congress.
1:22:15
I think it is very important. But when I see the people
1:22:19
leading the effort, like Elon Musk call something like Social
1:22:23
Security a Ponzi scheme, and I hear crickets on the other side
1:22:28
of the aisle, I have a really hard time taking any of this
1:22:32
seriously. When I go home and I have people
1:22:35
coming up to be in the grocery store who are living paycheck to
1:22:37
paycheck asking me, what are you going to do to protect Social
1:22:41
Security? So thank you so much and I yield
1:22:44
back. Jim and yields back his time.
1:22:48
Distinguished gentleman from Florida, Miss Moskowitz, who's
1:22:51
asked to be waved on this committee server.
1:22:54
Delighted Chair. Gentleman's recognized.
1:22:57
Thank you, Mr. Chairman, Thank you for granting my waiver.
1:22:59
I, I appreciate it. You know, I've been committed to
1:23:04
helping the government become more efficient, save dollars, go
1:23:07
after fraud, waste, abuse. I was the first Democrat to join
1:23:09
the DOGE caucus, which by the way, hasn't done anything and
1:23:12
has not been included in anything Elon Musk has done.
1:23:16
But you know, it's nice that we have a we have a caucus.
1:23:20
And so this is this is a bipartisan effort.
1:23:23
Like the chairman mentioned, we do want to get at waste, fraud
1:23:26
and abuse. But I do think the spelling,
1:23:28
miss, the spelling fact from fiction is important.
1:23:33
And I want to drill down real quickly first on what my
1:23:39
colleague from Florida, Mr. Frost, said.
1:23:41
And I'm going to be even more direct because I think it's
1:23:43
important. We'll just go down the line.
1:23:45
So you gave a, an answer on whether Social Security is a
1:23:50
Ponzi scheme. The answer is no, right?
1:23:52
It's not a Ponzi scheme. We have not reported that it's a
1:23:56
Ponzi scheme. Right, so it's not a Ponzi
1:23:57
scheme. I'm not aware that it's a Ponzi
1:24:00
scheme. OK, agreed.
1:24:02
OK, so Mr. Musk is wrong. No one, no one's going to get
1:24:05
fired for saying it, right? He's wrong.
1:24:08
You can say it. It's not a Ponzi scheme.
1:24:10
I'll say it for you. It's not a Ponzi scheme.
1:24:12
It's not a Ponzi. OK, He's wrong.
1:24:13
I know we're afraid to say it. And see, that's part of the
1:24:16
problem. We're afraid to say that Elon
1:24:20
Musk is wrong. That's what Mr. Frost was
1:24:23
talking about. When he says he hears crickets
1:24:26
from my colleagues, we hear crickets from the witnesses
1:24:31
because everyone is afraid. When Elon says something, if
1:24:35
it's patently false, we're afraid to say it's false.
1:24:38
All right, let's talk about something else.
1:24:40
The the IG is getting fired. You support the IG is getting
1:24:44
fired at me. I got to imagine if you're
1:24:45
interested in getting rid of fraud, waste and abuse.
1:24:48
They're the people. Trying to get rid of fraud,
1:24:51
waste and abuse. So they got fired from
1:24:53
Agriculture, Interior, HUD, Department of Defense, the EPA,
1:24:57
the State Department, HHS, Veterans Affairs, Labor,
1:25:00
Transportation. You support that in the mission
1:25:05
of getting rid of fraud and waste and abuse.
1:25:08
The Inspector General committee is is critical.
1:25:10
There are certainly an. An administration can give.
1:25:14
No opinion whether that was good or bad.
1:25:16
Again, I we won't say Elon's wrong.
1:25:18
I know you you won't go there, but was that the right decision?
1:25:23
You did lose institutional knowledge.
1:25:25
Certainly administration has a right to change the inspector
1:25:28
generalist. There are reporting mechanisms
1:25:29
of. These weren't necessarily in
1:25:31
like in like let's use numbers, let's use data.
1:25:33
So like 514951 bad idea. That was a bad idea.
1:25:41
I'm trying to. The proper protocols weren't
1:25:43
followed in. Oh, we know it was illegal.
1:25:46
Don't get me wrong, I didn't. I didn't want to make you say
1:25:48
that. I appreciate you saying that on
1:25:50
the record. It was illegal.
1:25:51
The proper protocols weren't filed.
1:25:52
But is it good policy if you want to go after fraud, waste
1:25:56
and abuse? Was that good policy?
1:25:58
To lose institutional knowledge. No, not good.
1:26:01
Good policy. I don't think it improves the
1:26:04
ability to fight fraud waste. Abuse, not good policy.
1:26:06
Not good policy. OK, right.
1:26:07
And if you're telling the American people that this is a
1:26:11
focus of your administration and then you go fire all of the AGS,
1:26:16
that doesn't seem to compute. OK.
1:26:18
Lastly, did fraud and an improper payment start with Joe
1:26:22
Biden in his administration? Was that the first time the
1:26:27
government has experienced that? That is not the first time no
1:26:30
fraud was reported. First time, no.
1:26:32
First time, no. So we got to depoliticize this
1:26:36
stuff because all we're heated hearing is what happened in the
1:26:38
last four years and the last four years in 2017, $140 billion
1:26:43
of improper payments that's inaccurate in. 2024 we reported
1:26:52
162 billion. No, no, hold on.
1:26:54
In 2017, 140 billion in improper payments, In 2018 a $150 billion
1:27:00
of improper payments, In 2019, 174 billion of improper
1:27:05
payments, and in 2020, two 106 billion of improper payments.
1:27:09
Those are GAO numbers. So let me just do some math.
1:27:13
In the first Trump administration, there were $670
1:27:16
billion of improper payments. I'm not blaming him, but he is
1:27:25
blaming Joe Biden, and so is Elon Musk blaming for the
1:27:29
improper payments for what happened in the four years of
1:27:32
Joe Biden. My point is, Mr. Chairman, if we
1:27:35
do want to solve this on a bipartisan basis, then we got to
1:27:39
separate fact from fiction. We got to depoliticize it, $670
1:27:44
billion of improper payments and fraud, waste and abuse in the
1:27:48
first Trump administration. Isn't that correct?
1:27:51
Correct. Isn't that correct?
1:27:53
I don't have any reason to dodge your math.
1:27:54
OK. Isn't that correct?
1:27:56
I believe? So perfect.
1:27:58
Thank you, Mr. Chairman. Does gentleman seek to give back
1:28:05
his time, or is gentleman? Mr. Chairman, I had no time
1:28:08
back, but I will. I'm happy to give you.
1:28:10
The gentleman your ranking member has asked if we would
1:28:14
have a second round. Distinguished Gentleman's
1:28:16
recognized Mr. Vome well. Thank you very much, Mr. Chair.
1:28:20
I want to thank Mr. Mark Goods and I to the gentleman from
1:28:24
Florida. I will say Elon Musk is a lie on
1:28:27
the record, which I've said many times.
1:28:29
So I guess he's coming after me. One of the things we want to do
1:28:33
here is to allow everybody freedom of expression.
1:28:37
This is an issue particularly for the chairman and I.
1:28:40
We've been working this for a long, long time, and getting to
1:28:45
the root of this by implementing what we're hearing today and
1:28:48
what we've learned from previous hearings is extremely, extremely
1:28:52
important. I don't want to be redundant,
1:28:54
but again, this whole notion about do we have an enforcement
1:28:58
mechanism in place when agency heads just watch this sort of
1:29:02
thing occur under their tenure and do nothing about it, or
1:29:06
watch it and feel like they can't do anything about it?
1:29:09
And for those brave souls who do, how do we reward them?
1:29:12
And what what do we do as a Congress to make sure that we
1:29:16
were tightening up their spine and that they're doing the right
1:29:19
thing? I think it's fair to say that
1:29:23
there will be legislation coming out of this hearing at some
1:29:25
point in time. I know the chairman has
1:29:28
expressed an interest that I hope to join him in that regard.
1:29:32
If we don't do anything else, once the shouting and everything
1:29:37
else is over with, we've got to find a way to make sure that
1:29:40
dollars that could be used to help people in this country
1:29:44
actually get to people. If we're able to slow down this.
1:29:47
I can't call it a trickle of fraud, waste and abuse.
1:29:51
An avalanche that has been going on.
1:29:52
And I've been looking at the GAO numbers going all the way back
1:29:55
to 2003. So Mr. Markowitz was right, it
1:29:58
didn't start under Joe Biden. This has been going on and on
1:30:01
and on, and I think we will have a gross failure on our part if
1:30:07
we don't find a way in this committee with this win to our
1:30:11
back to do something about it. I it's, it's going to take calm,
1:30:17
clear thinking, a resolute determination to make sure that
1:30:23
whatever legislation we are able to come up with jointly over and
1:30:27
over again that passes really does get us to where we want to
1:30:30
be. I would think that everybody in
1:30:34
this country is appalled to know that there are crooks out here
1:30:38
who feed on the government, who lie, who cheat, who steal, who
1:30:42
deliberately find a way to get around the law.
1:30:45
And I don't know that there's any safe haven for those
1:30:48
individuals wherever they are. I do know that we've got to
1:30:51
bring the hammer down on them, which is why I'm so dismayed
1:30:55
that the inspectors general are not in place to do just that.
1:30:59
They had started a process and it was yielding results.
1:31:03
So I'm going to yield back to our our chairman.
1:31:07
My commitment is to work through these issues, to work in a
1:31:12
bipartisan way where possible. And I hope that's very possible.
1:31:17
And to keep saying what we've been saying over and over again,
1:31:20
which now is starting to get some sort of audience just
1:31:24
because I guess Elon Musk has a bigger bullhorn than my
1:31:29
microphone here. But we've been at this.
1:31:30
This is not new. And we've got to find a way to
1:31:34
do it in a way that is surgical, deliberate, verifiable, and
1:31:39
allows for due process. With that, I'm going to yield
1:31:42
back. Thank you, Mr. Chairman.
1:31:43
I appreciate the time. Thank you very much.
1:31:47
And also, if the gentleman does, I don't know if that was your
1:31:50
closing comments. OK, then I'm going to yield
1:31:53
myself my time and then I probably will can put those
1:31:58
together with my closing comments and then we'll get out.
1:32:01
I want to thank the not only the witnesses who are here today,
1:32:06
but some of the other who are others who are in the audience.
1:32:10
I think today you saw a very classic events that happen
1:32:16
almost every day on the Hill and that is people miss the opening
1:32:20
statements, they miss some of the Nuggets of information that
1:32:25
each of you gave. But what resides in each of us
1:32:29
is a desire. When we hear the term $800
1:32:33
billion, whether it's waste, fraud or abuse or unintended
1:32:37
payments, what whatever you would want to put that term
1:32:40
with, it is frustrating. It's frustrating for us.
1:32:45
It's frustrating for you. I will tell you that I think
1:32:50
what Mr. Imphume described was the two of us when he said the
1:32:55
answer needs to be, I think the answer needs to be a bipartisan
1:33:02
answer. I think it needs to be looking
1:33:05
at this together. I think it needs to be this
1:33:08
subcommittee through his leadership and perhaps hopefully
1:33:12
through mine, that we can guide us to decision making, that his
1:33:17
strong voice, my voice, can move us where we need to go.
1:33:24
Where is it that we need to go? I think today that we heard
1:33:27
about the pandemic Responsible Accountability Committee is one
1:33:32
of those answers. It is an answer that it
1:33:35
currently exists and it was a bipartisan answer.
1:33:40
It still maintains a good bit of data, but it was done just for
1:33:45
the pandemic. It was not done for other
1:33:47
programs that would reside across the government.
1:33:50
I think that the expertise that Mister Deffenbaugh spoke to me
1:33:54
about yesterday when I met with him for a good period of time
1:33:58
was that he sees that they could be a potential front side answer
1:34:06
to not just waste, fraud and abuse, but on an individual
1:34:13
basis for the various organizations, Social Security,
1:34:18
Veterans Affairs, IRS. We spoke about how 18F us for
1:34:26
some time provided some assurance that they would know
1:34:31
who a person was on coming in, but we now recognize it didn't
1:34:36
quite work that way. But the Pandemic Response
1:34:40
Accountability Committee has effectively been able to prove
1:34:44
that the work that they have done.
1:34:47
And so a piece of legislation, I spoke to Chairman Comer about it
1:34:52
this morning, will be in order within two weeks.
1:34:56
We're going to go to a markup. We are going to work together.
1:35:00
We're going to, I think, see the same answer.
1:35:04
And that is we think that you worked, Mr. Deffenbaugh.
1:35:10
We think that that answer is an upfront answer.
1:35:14
And we will then have to find a way to mirror not only what you
1:35:20
do, but find a way to bring the avenues of data and information
1:35:24
upfront and apply those same principles to the biggest
1:35:30
problem. I don't think that we'll go
1:35:31
overnight directly to you. I don't think your staff for
1:35:35
that. I don't we'll work together.
1:35:38
But I do think that the answer lies in upfront gaining the
1:35:45
information. If the members had all been here
1:35:48
upfront, they would have heard all three of you concur on that.
1:35:52
They would have said, well, we need to do this on an upfront
1:35:57
basis as a person goes through this process, in particular,
1:36:01
before we send out billions or trillions of dollars to people,
1:36:06
which is something that I've tried to echo.
1:36:08
Our government is not prepared to send money out on a mass
1:36:12
basis at this point. We are not prepared.
1:36:17
And I'm not trying to disappoint anybody in this administration,
1:36:21
but we're not prepared for it. We need to get prepared.
1:36:24
And I believe that Mister Infume and I, who've been given this
1:36:28
authority and responsibility, will continue to work with you.
1:36:34
I'll be quite honest, I was delighted with what I heard
1:36:37
yesterday from GAOI think that they have provided us a lot of
1:36:42
information which is allowing us to hone in not only on the
1:36:47
problems but the answers. And I think if we move our self
1:36:52
to answers through a process that people understand and
1:36:57
expect, it will mean that a lot of people gain confidence in not
1:37:04
only the federal government but the workforces that are there.
1:37:09
Lastly, I don't want to do this necessarily because the
1:37:13
gentlemen are not here, Mr. Frost, Miss Moskowitz, but it I,
1:37:19
I think might be slightly a revision to what he said about
1:37:25
their hearing. Crickets.
1:37:27
In fact, the $800 billion is a 10 year number.
1:37:33
These will be votes that will be taken.
1:37:36
And we have already seen where these numbers which are being
1:37:41
looked at by this Doge organization.
1:37:45
O MB, O MB in the government is reporting that they believe the
1:37:52
huge numbers of quote cuts could be achieved by reducing the
1:37:59
amount of unintended payments and we could look back.
1:38:04
I did not do that to to line up whether it's Medicare, whether
1:38:09
it's Medicaid, whether it's VA, whether it's SBAI did not look
1:38:13
at that from the information that GAO has given us.
1:38:17
What I will tell you is, is that people like me, and I think
1:38:24
people like Mr. Infume want to do something about it.
1:38:29
People like me, I am a Republican, believe that we can
1:38:35
get credit for cutting waste, fraud and abuse.
1:38:40
And we have laid down the gauntlet to say we are going to
1:38:45
do the things that would be necessary to cut unintended
1:38:52
payments, and we're going to work those into the government.
1:38:57
And we're going to make sure this happens.
1:39:00
And that will be done on a bipartisan basis.
1:39:03
But for us to assume that we cannot make this better by
1:39:10
growth, that we would make it better by growing the
1:39:14
organization, I would submit to you, I don't agree with that.
1:39:19
I don't agree that we can do it by keeping workers at home
1:39:23
rather than in the office, working with databases and
1:39:27
figuring out who wants to get committed.
1:39:30
And this is where I saw the process that is political, where
1:39:34
the president said if you don't choose not to want to come back,
1:39:37
He understood that he would offer a buyout plan that was
1:39:41
immediately attacked. We live in a political world and
1:39:46
there are people who will attack President Biden or President
1:39:50
Trump just from their word go, the word go of their name.
1:39:55
So I would submit to you that I think that we are not having
1:39:59
crickets. We are having a plan that we're
1:40:02
laying out. I've got to do a better job as
1:40:06
one of the Co chairman of DOGE. It is my opportunity and my real
1:40:11
need to talk to the American people with clarity.
1:40:15
But as the father of a Down syndrome young man who is 31
1:40:19
years old, I too have been through and seen how our
1:40:24
services that we offer to those people who cannot take care of
1:40:27
themself and their families should not be the ones that find
1:40:33
themselves on the wrong end of these changes.
1:40:39
It is true what was stated to hear today that families that
1:40:43
have disabled people, disabled children, disabled adults,
1:40:49
people they care for have a higher threshold of frustration
1:40:57
of working through the system. And I think that system will get
1:41:02
better as we hone ourself through the work that would be
1:41:07
done on a bipartisan basis and less fear.
1:41:12
The fear that people have about losing Social Security is in
1:41:19
fact not true. It would not be true.
1:41:25
It is not the goal of Elon Musk or of this government, and I do
1:41:33
recognize there have been some words stated about their
1:41:40
problems with what they see as an aggregate amount of
1:41:44
unintended payments. But I will tell you that there
1:41:49
is more than enough room to stop the unintended payments that
1:41:54
would equal the amount of money that is almost destined to be
1:41:59
cut. We deal with 10 year numbers,
1:42:03
not one year numbers. We deal with numbers that are
1:42:07
exponentially high. And it sounds almost like, Oh my
1:42:12
gosh, they're going to shut down the program.
1:42:16
In fact, there needs to be thought process behind it.
1:42:20
I am no way am afraid of a town hall meeting of explaining what
1:42:26
we're doing. But as a member of Congress, if
1:42:30
we accept that where we are and where we have been is acceptable
1:42:35
to our future, we are missing the boat.
1:42:38
So I would ask that each of you know that you got asked tough
1:42:45
questions today. Doesn't bother me.
1:42:48
But to have the confidence that if we move forward together,
1:42:52
including Mr. Mfume and myself, that we can end up in a point
1:42:57
where we look at each other and say we made this better, We
1:43:02
saved the money that was actually destined for people
1:43:07
that it was intended to, and then we'll see what the score
1:43:11
is. I have great confidence we can
1:43:14
do this. So I do not want to a
1:43:17
conversation that they hear crickets to be part of this.
1:43:23
There are not crickets. There is a really daunting task
1:43:28
of us to take this $1.7 trillion or $2.7 trillion, whatever the
1:43:35
amount was that is laid in front of us.
1:43:39
And we were never talking about cuts that were bigger than that.
1:43:44
We were talking about cuts that are way less.
1:43:47
But that makes sense. So I want to thank each of you
1:43:50
for being here today. I think each of you did well
1:43:54
enough to be invited back. But perhaps more importantly, we
1:43:59
would like to work with you and Mr. Mfume and I are going to
1:44:02
deal with this and legislation will pass it to you and also see
1:44:08
if you would, what your opinion might be for that.
1:44:11
But I want to thank you each for being here today.
1:44:15
The gentleman Does the gentleman wish to further time?
1:44:18
Just to thank our witnesses. We do thank our witnesses and
1:44:22
that they stick around a second. Mr. Mfume and I are going to end
1:44:25
this hearing and come and thank you for being here.
1:44:29
This concludes the hearing today.
1:44:31
I want to thank the witnesses and you're now excused.
1:44:41
My script, right? Whoops, we will.
1:44:45
Where's the five day? Well, hold on just a second.
1:44:48
I'm sorry. We will.
1:44:51
Without objection, we will extend to where's the statement
1:44:57
you want me to read The five days?
1:44:59
It's all 5 legislative days for people to ask for questions and
1:45:04
to receive information. Where is that bill?
1:45:10
Where is it? I don't see it, and I apologize.
1:45:14
It's a normal thing we do. There you go, Crystal.
1:45:16
All right. That's unanimous consent that
1:45:23
all numbers. For our phone, yeah, I've.
1:45:26
Legislated. Yeah, I know what it says, but
1:45:29
I'm going to read. Oh, there it is.
1:45:31
With all that said, without objection, all members will have
1:45:34
5 legislative days within which to submit additional written
1:45:37
questions for witnesses, which before did the witness for their
1:45:40
response. There's no further business.
1:45:43
Without objection, Subcommittee stands adjourned.
1:45:59
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