Biden announces progress in cutting federal government waste

The administration is specifically targeting cuts in the federal governments administrative expenses, such as travel, auto fleets, bulk purchasing and a reduction in agency publications, a favorite of Sen. Tom Coburn (R-Okla.), along with office equipment and supplies from cellphones to software.

In signs of early success, officials said contract spending shrank for the first time in 13 years and $3 billion in cost reductions have been made in information technology projects. The Agriculture Department also recently reported a record-low error rate in the food stamps program and the Census Bureau consolidated field offices to cut costs.

White House officials said HHS will apply the framework from the Medicare Recovery Audit Contractor program to Medicaid, providing an estimated savings of about $2.1 billion over five years by catching or stopping improper payments, returning about $900 million of that to the states. The Medicare program has recovered $668 million in improper payments to date in 2011, officials said. 

“Today’s announcements on cutting waste in Medicare, Medicaid and unemployment insurance shows that we can make our government more efficient and responsible to the American people,” Biden said in a news release. “If we’re going to spur jobs and economic growth and restore long-term fiscal solvency, we need to make sure hard-earned tax dollars don’t go to waste.”

The Labor Department is making strides in reducing the estimated $17.5 billion in improper unemployment insurance claims, a total of 11.2 percent of claims.

Three grants — amounting to $191.4 million — are going out to states to improve operations and technology to identify those who have already returned to work but continue to claim benefits (30 percent of all claimants), along with those who gave inaccurate information on why they left their previous jobs, amounting to another 30 percent of bad payments. The grants also should provide a way for the Treasury Department to recover the overpayments using tax refunds, officials said.  

The grants will aim to help the six states — Virginia, Indiana, Colorado, Washington, Louisiana and Arizona — that have the highest rates of improper payments. 

The Labor Department also is launching a new effort to show every state’s performance on improper payments with an online map that will show a state’s payment errors, which types of problems are driving its error rate and steps being taken to address its rate.

In addition, high-performing states will be paired with these states to offer guidance and aid as the plans are developed and implemented. 

At Homeland Security, 36 initiatives were implemented, resulting in about $1 billion in cost avoidances by streamlining publications, buying office supplies differently, buying software licenses in bulk and using government offices for meetings instead of renting private space, along with other measures.

More in Finance

Watchdogs brace for surprises in massive $1.014T spending bill

Read more »