Medicaid Waste Exposed: HHS Watchdog Reveals $207 Million in Payments to Deceased Recipients, Demands Federal Action

An HHS Office of Inspector General audit uncovered that Medicaid programs improperly paid $207 million to managed care organizations for deceased enrollees between July 2021 and July 2022, despite death records being available in the Social Security Administration’s Death Master File.

 By yourNEWS Media Newsroom

WASHINGTON — A report released Tuesday by the Department of Health and Human Services (HHS) Office of the Inspector General (OIG) found that Medicaid programs improperly paid $207 million to managed care organizations for enrollees who had already died. The payments, made between July 2021 and July 2022, were flagged in an audit that revealed the deceased individuals’ records were correctly documented in the Social Security Administration’s Death Master File.

The OIG noted that some state Medicaid programs had already begun recovering the overpayments before the audit’s findings were formally presented. The watchdog urged the federal government to enhance information-sharing with states to expedite the recovery of the remaining funds.

The report also highlighted that provisions in the One Big Beautiful Bill Act, enacted earlier this year, could help minimize future unallowable Medicaid payments. One key provision requires states to audit their Medicaid beneficiary lists to remove deceased recipients, addressing a systemic vulnerability in the program’s oversight.

This revelation follows a recent admission by Secretary of Agriculture Brooke Rollins, who acknowledged last month that SNAP benefit payments have also been issued to deceased individuals. To combat this issue, Rollins announced plans to require all SNAP recipients to reapply for benefits, aiming to eliminate fraud and administrative errors.

The OIG’s findings underscore persistent challenges in government benefit programs, where outdated systems and insufficient cross-agency coordination continue to enable waste, fraud, and abuse. As federal and state agencies work to implement corrective measures, the report serves as a call to action for strengthened oversight and accountability in public assistance programs.