29 Aug GAO 2025 REPORT IDENTIFIES MEDICAID AS A HIGH-RISK PROGRAM FOR IMPROPER PAYMENTS
The Scope of the Problem
In its August 2025 report, GAO-25-108067, the Government Accountability Office (GAO) highlighted 32 priority recommendations for the Department of the Treasury. At the forefront of these recommendations is addressing the widespread issue of fraud and improper payments—a problem that continues to affect nearly every major federal program, including Medicaid.
GAO’s analysis shows that the federal government loses between $233 billion and $521 billion annually to fraud. Since 2003, agencies have reported nearly $2.8 trillion in improper payments. Medicaid consistently accounts for a significant portion of these totals, contributing to seven straight years in which improper payments government-wide exceeded $150 billion annually.
What GAO Recommends
The GAO urged the Treasury, working with the Office of Management and Budget (OMB), to take stronger action, including:
- Building more advanced fraud estimation methods for high-risk programs such as Medicaid.
- Designing recovery audits and post-payment review processes to improve identification and recovery of overpayments.
- Focusing oversight resources on the riskiest areas, with Medicaid highlighted as a program of concern.
The report also warns that the longer overpayments remain unresolved, the less likely it is that recovery will occur.
Medicaid’s Billion Dollar Problem
The findings align with Syrtis Solutions’ white paper, Improper Payments: Medicaid’s Billion Dollar Problem, which examines the persistent causes of Medicaid waste, including:
- Eligibility determination errors
- Verification gaps
- Weaknesses in the coordination of benefits (COB)
While the GAO emphasizes corrective action after improper payments occur, Syrtis Solutions demonstrates the value of front-end prevention. With its ProTPL solution, Syrtis provides managed care organizations (MCOs) with real-time access to verified other health insurance (OHI) and third-party liability (TPL) information. This enables MCOs to avoid paying claims that are the responsibility of other third parties, significantly lowering the risk of improper payments.
Addressing Medicaid’s Risk
Improper payments remain one of Medicaid’s most significant challenges, draining billions in resources each year. GAO’s recommendations underscore the importance of stronger oversight; however, states and MCOs can take action now by implementing solutions designed to prevent waste at its source.
Case studies confirm that proactive COB and TPL strategies can achieve ROI ratios of more than 15:1, resulting in measurable savings while enhancing Medicaid’s long-term sustainability.
The GAO’s 2025 report emphasizes the importance of addressing improper payments across the federal government. Medicaid is at the center of this challenge, requiring both robust federal oversight and the adoption of effective, proactive cost-avoidance strategies. Tools like Syrtis Solutions’ ProTPL enable states and MCOs to reduce exposure to improper payments, preserve taxpayer dollars, and ensure the sustainability of the Medicaid program.