Payment Integrity: What the Government Just Told Us About Improper Payments and Fraud
GAO-24-107660
Full Report: https://www.gao.gov/products/GAO-24-107660
Government Finding Summary
The Government Accountability Office reported that since fiscal year 2003, federal agencies have estimated $2.7 trillion in improper payments.
In fiscal year 2023 alone, agencies reported $236 billion in improper payments across 71 programs.
Six program areas accounted for approximately $200 billion of that total:
Medicare
Medicaid
Unemployment Insurance
Paycheck Protection Program
Earned Income Tax Credit
Supplemental Security Income
GAO also estimated that annual federal fraud losses range between $233 billion and $521 billion, depending on the risk environment.
The report makes an important distinction:
All fraud is improper payment.
Not all improper payments are fraud.
Improper payments include overpayments, underpayments, eligibility errors, and payments lacking sufficient documentation.
GAO further found that:
10 major federal agencies were not fully compliant with federal improper payment reporting requirements.
Key fraud prevention recommendations remain unimplemented.
Congress has not yet enacted several structural reforms GAO recommended as far back as 2022.
The federal government continues to list improper payments as a material weakness in financial reporting.
Auxilium’s Interpretation
This report confirms something important:
Payment integrity is not just a federal accounting problem. It is a systems problem.
When improper payments increase, public trust decreases. Oversight becomes reactive. Fraud detection becomes harder. And beneficiaries, especially vulnerable ones, can be caught in the middle of administrative corrections and program tightening.
One program included in GAO’s high-risk list is Supplemental Security Income (SSI), administered by the Social Security Administration.
SSI serves individuals who are disabled, elderly, or have limited income and resources.
Improper payments in SSI are often caused by:
Eligibility reporting delays
Income changes not processed timely
Documentation gaps
Administrative complexity
For individuals who require a representative payee, these system weaknesses can compound risk.
The more complex the program, the greater the need for structured financial management.
This is where nonprofit organizational representative payees play a stabilizing role.
What Auxilium Does About It
Auxilium Payee Services operates within the framework established by the Social Security Administration.
We do not determine who needs a payee.
We step in after that need is established.
In an environment where federal oversight’s are reporting systemic improper payments and fraud risk, our responsibility is clear:
1. Protect the Beneficiary First
We ensure SSI funds are used for housing, food, utilities, medical care, and essential needs.
2. Maintain Clear Documentation
Improper payments often stem from documentation failures. Our processes prioritize structured recordkeeping and audit readiness.
3. Separate Funds Properly
Each beneficiary’s funds are managed separately and never mixed with organizational or personal accounts.
4. Monitor
Ongoing review reduces risk of unnoticed overpayments or reporting gaps.
5. Operate as Standing Capacity
When a nonprofit organizational representative payee is needed, we are ready to accept appointments responsibly and without delay.
Why This Matters
Improper payments are not abstract numbers.
They reflect breakdowns in process, verification, communication, or oversight.
For large federal programs, those breakdowns create fiscal pressure.
For individual beneficiaries, they create instability.
If Congress strengthens reporting rules, analytics centers, fraud controls, and financial oversight as GAO recommends, payment integrity should improve.
But even before federal reform catches up, beneficiaries still need protection today.
When an individual cannot manage their own benefits and no suitable family payee is available, an organizational payee provides structured financial stewardship inside a system that is actively working to correct its own vulnerabilities.
