Program Integrity: Actions Needed to Reduce Improper Payment and Fraud Risks in VA Community Care and Medicare Advantage
Fast Facts
In FY 2025, the VA's Community Care program made $608 million in payment errors and Medicare Advantage made $23.7 billion in payment errors. Both programs also paid fraudulent claims.
This report—the first in a series—summarizes VA and Medicare efforts to reduce payment errors and manage fraud risks. Neither agency has developed comprehensive fraud risk assessments for its respective program. We also found:
VA has taken steps to identify and assess fraud risks
Medicare's efforts to address the root causes of Medicare Advantage payment errors haven't been effective
Our recommendations address these issues.
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Highlights
What GAO Found
The Office of Management and Budget annually designates a list of programs considered high-priority for improper payments. The Department of Veterans Affairs (VA) Community Care program and the Centers for Medicare & Medicaid Services’ (CMS) Medicare Advantage program are two of the 30 programs designated as high priority for fiscal year 2025. VA reported a Community Care improper payment estimate of $608 million for fiscal year 2025, or 2.4 percent of the program’s outlays. CMS reported a Medicare Advantage improper payment estimate of $23.7 billion for fiscal year 2025, or 6.1 percent of the program’s outlays. GAO found gaps in the agencies’ efforts to reduce improper payment and fraud risks.
Agency Efforts to Reduce Improper Payments and Fraud Risks
|
|
Community Care Program |
Medicare Advantage Program |
|---|---|---|
|
Developed and implemented a process to identify and assess the root causes of improper payments |
● | ● |
|
Developed, implemented, and monitored corrective action plans that adequately address the identified root causes of improper payments |
● | ◐ |
|
Conducted a fraud risk assessment that identifies inherent fraud risks, assesses their likelihood and impact, determines risk tolerance, evaluates controls, and documents a fraud risk profile |
○ | ○ |
Legend: ● Met; ◐ Partially met; ○ Not met.
Source: GAO. | GAO-26-107946
Note: Analysis based on the results of GAO work completed from November 2024 through June 2026.
For the fiscal years included in GAO’s review, VA developed and implemented a process to identify and assess the root causes of improper payments in the Community Care program. VA also developed, implemented, and monitored corrective action plans that adequately address the identified root causes. While VA has taken steps to identify and assess fraud risks, these efforts do not meet the key elements of a fraud risk assessment and have not resulted in a comprehensive fraud risk assessment for the program, leaving it vulnerable to fraud.
For the fiscal years included in GAO’s review, CMS developed and implemented a process to identify and assess the root causes of improper payments in the Medicare Advantage program. However, its estimated improper payment rate has not decreased but remained steady. CMS’s corrective action plans are not sufficiently detailed and do not adequately monitor progress. Specifically, CMS does not have a detailed plan for expediting Risk Adjustment Data Validation (RADV) audits. These audits are CMS’s primary corrective action for identifying and recovering improper payments. CMS’s backlog of RADV audits contributes to significant delays in its recovery efforts. Furthermore, CMS has not conducted a comprehensive fraud risk assessment for the program. CMS’s efforts to reduce improper payments and fraud in the Medicare Advantage program will be inadequate without comprehensive corrective action plans and fraud risk assessments.
Why GAO Did This Study
Reducing improper payments and fraud is critical to safeguarding federal funds and could help achieve cost savings and improve the government’s fiscal position.
GAO was asked to assess agency efforts to identify and address root causes of improper payments and fraud. In this report, GAO examines to what extent (1) VA has taken steps to identify and address the root causes of improper payments and mitigate fraud risks in the Community Care program and (2) CMS has taken steps to identify and address the root causes of improper payments and mitigate fraud risks in the Medicare Advantage program.
GAO examined documentation from VA, CMS, PaymentAccuracy.gov, and prior reports from agency Offices of Inspector General (OIG). GAO also interviewed agency officials, OIG staff, and trade association representatives.
Recommendations
GAO recommends that VA conduct a comprehensive fraud risk assessment of the Community Care program that aligns with leading practices in the Fraud Risk Framework. VA concurred with the recommendation.
GAO recommends that CMS establish and document a detailed plan for expediting RADV audits and conduct a comprehensive fraud risk assessment of the Medicare Advantage program that aligns with leading practices in the Fraud Risk Framework. CMS neither agreed nor disagreed with the recommendations. CMS also described past actions it has taken that it believes address GAO’s recommendations. GAO maintains new CMS actions are warranted, as discussed in the report.
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Veterans Affairs | The Department of Veterans Affairs' Under Secretary for Health should conduct a comprehensive fraud risk assessment of the Community Care program that aligns with leading practices in the Fraud Risk Framework. (Recommendation 1) |
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
| Centers for Medicare & Medicaid Services | The Administrator for the Centers for Medicare & Medicaid Services should establish and document a detailed plan for expediting RADV audits, including cost estimates, planned completion dates, and metrics for monitoring implementation progress and effectiveness in reducing improper payments. (Recommendation 2) |
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
| Centers for Medicare & Medicaid Services | The Administrator for the Centers for Medicare & Medicaid Services should conduct a comprehensive fraud risk assessment of the Medicare Advantage program that aligns with leading practices in the Fraud Risk Framework. (Recommendation 3) |
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|