(Washington, D.C.) – Today, Citizens Against Government Waste expressed dismay at the initial results of the Obama administration’s Campaign to Cut Waste.  There is only $2.1 billion in future savings at the Department of Health and Human Services (HHS), which yesterday released its final rule on a Medicaid auditing program that was unveiled 18 months ago but has been delayed twice.  According to Office of Management and Budget Director Jack Lew, the savings will come from the Medicaid Recovery Audit Contractor Program (RAC), an initiative aimed at helping states “identify and recover improper Medicaid payments” that will be “largely self-funded, paying independent auditors a contingency fee out of any improper payments they recover.”  CAGW praised the Obama administration’s decision to engage with RACs – already a success at the Defense Department and a staple of the private sector – on improper payments in Medicare and Medicaid in March, 2010.

When President Obama established the Campaign to Cut Waste in June, 2011, it was at least the fifth such initiative undertaken by the Obama administration since 2009, and, like the others before it, provided nothing new along the lines of tangible spending cuts or concrete suggestions for cutting government bloat.  Ironically, President Obama’s 2009 Affordable Care Act, which is certain to dramatically increase federal spending and the national debt, included a requirement to expand RACs to Medicaid, a proposal that will save taxpayers money.

“While the savings are worth mentioning,” said CAGW President Tom Schatz, “$2.1 billion is tiny compared to the huge amount of waste perpetrated by federal agencies every year.  Recovery auditing was first implemented though a limited three-state Medicare RAC demonstration project by the Centers for Medicare and Medicaid Services between 2005 and 2008, after which it was expanded to all of Medicare.  When HHS unveils an old program that was mandated two years ago and claims new savings for taxpayers, the reaction at CAGW is, ‘What took you so long?’  

“If Cabinet members truly want to eliminate significant amounts of duplicative, wasteful spending, they should start with the Government Accountability Office’s report from March, 2011 that identified 34 agencies, offices, and initiatives that provide similar or identical services to the same populations, along with 47 programs that are either wasteful or inefficient.  The list included 18 nutrition and food assistance programs, 47 job retraining programs, 80 economic development programs, 56 financial literacy programs, and $77 billion of waste at the Department of Defense.  Further, they should review CAGW’s 2011 Prime Cuts database, which features 691waste-cutting recommendations that would save taxpayers $391.9 billion in the first year and $1.8 trillion over five years,” Schatz concluded. 

Citizens Against Government Waste is a nonpartisan, nonprofit organization dedicated to eliminating waste, fraud, mismanagement and abuse in government.