Medicaid Programs Overspend: Over $200 Million in Payments to Deceased Individuals

Tue Dec 23 2025 16:51:11 GMT+0200 (Eastern European Standard Time)

A recent report reveals that Medicaid programs made improper payments exceeding $200 million to healthcare providers on behalf of deceased enrollees between 2021 and 2022. Efforts are underway to rectify this issue.

According to a new report from the Department of Health and Human Services' Office of Inspector General, Medicaid programs issued over $200 million in improper payments for individuals who had already died. This issue, highlighted as persistent across various states, prompts recommendations for better oversight, including sharing information from the Social Security Administration's Full Death Master File. A new provision in Republican legislation may also aid in reducing these errors in the future.

WASHINGTON (AP) — A recent report from the independent watchdog for the Department of Health and Human Services reveals that Medicaid programs authorized over $200 million in improper payments to healthcare providers between 2021 and 2022 for individuals who were deceased.

The report, released by the Office of Inspector General, indicates that over $207.5 million in managed care payments were issued on behalf of deceased enrollees during the one-year period from July 2021 to July 2022. This problem is not isolated to any single state, according to Aner Sanchez, deputy regional inspector general in the Office of Audit Services, who has studied this issue for a decade.

In an effort to mitigate such improper payments, the report encourages the federal government to enhance the information sharing with state agencies to aid in recovering these erroneous payments. A key suggestion includes utilizing the Full Death Master File from the Social Security Administration, which contains extensive records dating back to 1899.

Currently, sharing this data is limited due to privacy laws aimed at protecting individuals against identity theft and fraud. However, there’s hope on the horizon: a provision in the recently passed Republican One Big Beautiful Bill mandates states to regularly audit beneficiary lists against the Full Death Master File. This measure, starting in 2027, could significantly curtail the payments made to deceased individuals.

The report marks the first comprehensive assessment of improper Medicaid payments across the United States. Previous audits have highlighted a troubling trend, with about $289 million identified over a series of audits focusing on state programs since 2016. Reports from the Treasury Department earlier this year indicated some success in recovery efforts, having reclaimed over $31 million in improper payments to deceased individuals from a pilot program that temporarily granted access to the Full Death Master File.

In the backdrop, discrepancies were noted in the file itself as the Social Security Administration made peculiar modifications, adding and removing records, which further complicates the administration of this issue.