GAO Saved the Government $40 billion in 2 Years. Why Isn’t Anyone Listening?

The Government Accountability Office released its 2015 High-Risk List this morning before a series of officials, including U.S. Comptroller General Gene Dodaro, testified before the Senate Homeland Security and Governmental Affairs Committee.

The biennial report is GAO’s most-valued effort – a detailed description of the most troubled large-scale programs and projects in government.

Two new issues, IT acquisition and operations and health care at the Department of Veterans Affairs, were added to this year’s list, joining 30 other problematic programs.

Here are some of the most egregious tidbits from GAO’s newest report:

• GAO estimates more than $90 billion in improper payments among Medicare, Medicaid and the earned income tax credit. “Any effort to reduce the size (of improper payments) could yield billions, if not more in savings in those programs alone,” Dodaro stated. The Centers for Medicare and Medicaid Services overpaid for medical devices in 2012 by $6 billion, a figure referenced by a clearly disgusted Sen. Claire McCaskill, D-Mo.
• GAO has been reporting problems in veteran health care since 2000, with increased attention in the past five years. During that span, GAO has made 167 recommendations to VA, but only 20 percent have actually been heeded. If I followed only 20 percent of the recommendations of my overseers, I’d receive a swift boot in the butt out the doorway. “VA suffers from mismanagement and inadequate oversight, especially in individual facilities,” said Sen. Tammy Baldwin, D-Wisc. No kidding.
• The government spends a shade over $80 billion on IT each year, but $58 billion goes to legacy operations. That’s not a recipe for modernization. GAO has made 737 recommendations to agencies in an effort to improve IT spend, but only 23 percent of those recommendations have been fully implemented. “Again, Congress has made efforts in VA and IT, but efforts need to be monitored with more congressional oversight and, in my opinion, agencies need to be reformed,” Dodaro said.

What’s ironic is that when the government does fully follow GAO’s recommendations, it saves a whole lot of money.

Committee Chairman Sen. Ron Johnson, R-Wisc., put his accounting background on public display, highlighting one of the most absurd facts tossed around today.

In the past two years, the federal government has saved $40 billion by fully implementing GAO recommendations, which led him to ask Dodaro, “If we were to implement all the recommendations on the current High-Risk List, what do you think the potential savings would be?”

Dodaro didn’t give an exact number, but he hinted that just fixing improper payments in Medicare, Medicaid and earned income tax credits – implementing predictive analytics across those agencies to sniff out bad payments, for example – would likely save billions alone.

Despite such an obvious value – $40 billion saved in two years – Congress has actually cut GAO’s annual budget by some $30 million since 2010.

GAO’s operating budget is about $522 million, so the savings generated by its recommendations amount to a “76 to 1 payback,” Johnson said. He added, “We need to make sure GAO stays fully funded.”

(Image via sheff/Shutterstock.com)