Over 40% Of Federal Student Loan Recipients Aren’t Making Payments On Their Debts

Shocking Statistic: Over 40% Of Student Borrowers Don’t Make Payments – Zero Hedge

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Over 40 percent of those in student loan programs have stopped making payments. Many borrowers have never made any payments.

The department of education (a useless body that I would eliminate in one second if given the chance), cannot figure out why this is happening.

“We obviously have not cracked that nut but we want to keep working on it,” said Ted Mitchell, the Education Department’s under secretary.

The Wall Street Journal reports More Than 40% of Student Borrowers Aren’t Making Payments.
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More than 40% of Americans who borrowed from the government’s main student-loan program aren’t making payments or are behind on more than $200 billion owed, raising worries that millions of them may never repay.

While most have since left school and joined the workforce, 43% of the roughly 22 million Americans with federal student loans weren’t making payments as of Jan. 1, according to a quarterly snapshot of the Education Department’s $1.2 trillion student-loan portfolio.

About 1 in 6 borrowers, or 3.6 million, were in default on $56 billion in student debt, meaning they had gone at least a year without making a payment. Three million more owing roughly $66 billion were at least a month behind.

Meantime, another three million owing almost $110 billion were in “forbearance” or “deferment,” meaning they had received permission to temporarily halt payments due to a financial emergency, such as unemployment. The figures exclude borrowers still in school and those with government-guaranteed private loans.

Navient Corp., which services student loans and offers payment plans tied to income, says it attempts to reach each borrower on average 230 to 300 times – through letters, emails, calls and text messages – in the year leading up to his or her default. Ninety percent of those borrowers, which include federal borrowers as well as those who hold private loans, never respond and more than half never make a single payment before they default, the company says.

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Crisis Easy to Explain

Carlo Salerno, an economist who studies higher education and has consulted for the private student-lending industry, noted that the government imposes virtually no credit checks on borrowers, requires no cosigners and doesn’t screen people for their preparedness for college-level course work. “On what planet does a financing vehicle with those kinds of terms and those kinds of performance metrics make sense,” he said.

I could easily come up with numerous reasons off the top of my head.
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1. Being in the workforce and having a job are two different things.

2. Having a job and making enough money to pay back hundreds of thousands of dollars is yet another thing.

3. Some feel cheated by the system, as well they should.

4. Many have figured out the consequences of default are small. The worst that can happen is wage garnishment. Should that happen, one can always find another low-paying job, buying time until they are discovered again.

5. Some never intended to pay back the loans in the first place. To those borrowers, it’s all free money for a few years. They will stay in school as long as they can. If by some miracle they actually graduate (or are kicked out), they never make a payment.

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Blame Bush!

A large portion of the blame for this mess goes to George W. Bush. Seriously.

The Bankruptcy Abuse Prevention and Consumer Protection Act enacted April 20, 2005 made it much more difficult to discharge debts in bankruptcy.

Among other things, “BAPCPA amended the law to broaden the types of educational (“student”) loans that cannot be discharged in bankruptcy absent proof of “undue hardship.” The nature of the lender became irrelevant. Even loans from “for-profit” or “non-governmental” entities are not dischargeable.

The Deflation Guarantee Act of 2005

I predicted this mess when Bush signed the bill. As proof, I offer The Deflation Guarantee Act of 2005.

Here are my lead paragraphs as I wrote them at the time.
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Today Congress passed the “The Deflation Guarantee Act of 2005” currently known as the “Bankruptcy Abuse Prevention and Consumer Protection Act of 2005”. Twenty years from now economists are going to be studying legislation from this Congress and signed by this administration and be wondering: “What the * were they thinking?”.

Consumer Protection Act? LMAO

Anytime this administration passes a law with the “protection” in it, assume it will do just the opposite.

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Student Debt Highly Deflationary

I have wanted to refer back to that post on numerous occasions.

I had not done so previously because I strongly dislike my writing style in those days. I frequently used chat room talk like “LMAO” (laughing my ass off), in those early posts.

There are other aspects of my 2005 post that I dislike as well. However, I nailed the idea correctly. Student debt is a hugely deflationary force.

In the wake of that act (albeit with a bit of a delay), we saw massive amounts of seemingly reckless lending to students. Because of government guarantees, lenders did not give a damn who they lent to.

For profit universities flourished. Abuses at the University of Phoenix became rampant. And because of various lending programs that followed, education costs soared as well.

Those debts cannot be paid back, and household formation has gone into reverse. Students moved back home after graduation, and attitudes on debt have changed.

These are all debt deflation forces.

Modest Fee Request

The Department of Education will no doubt waste millions of taxpayer dollars studying this issue, only to come up with the wrong answers because students will lie.

Will anyone realistically admit “I never intended to pay back these loans”?

My modest fee for this analysis is a mere $250,000. Of that amount, I pledge $249,999.99 to the Khan Academy.

All I ask is a penny for my thoughts, saving taxpayers countless millions in useless department of education studies.

For more on the Khan Academy please see Teaching Revolution: Online, Accredited, Free; Start Learning Now!

Obama’s Role

President Obama does not escape criticism for his efforts to fuel the problem.

Here’s my blast at Obama: For Profit Schools Turn Students Into Debt Zombies; It’s Time To Kill The Entire Pell Grant Program.

There is plenty of blame to go around, but I have not seen a single person take this crisis back to the logical origin, the “Bankruptcy Abuse Prevention and Consumer Protection Act of 2005” making student debt non-dischargeable in bankruptcy.

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Arkansas Governor Hutchinson Ends Taxpayer-Funded Medicaid Payments To Planned Parenthood

Arkansas Ends Taxpayer-Funded Medicaid Payments To Planned Parenthood – Christian News Network

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The governor of Arkansas has directed the state Department of Human Services to terminate its Medicaid contract with the abortion giant Planned Parenthood.

In compliance with the request, the department sent a letter to Planned Parenthood of the Heartland on Friday as notice that the contract was being terminated.

“[T]he Arkansas Department of Human Services is hereby exercising its authority to terminate its existing agreements with Planned Parenthood of Arkansas & Eastern Oklahoma,” the correspondence reads. “The termination… will be effective 30 days from the date of this letter.”

Gov. Asa Hutchinson has also released a statement about the move, remarking that the decision was influenced by the recent video exposes’ outlining Planned Parenthood’s apparent harvesting and sale of aborted baby organs.

“It is apparent that after the recent revelations on the actions of Planned Parenthood, that this organization does not represent the values of the people of our state and Arkansas is better served by terminating any and all existing contracts with them,” he said. “This includes their affiliated organization, Planned Parenthood of Arkansas and Eastern Oklahoma.”

Planned Parenthood likewise released a statement, stating that by revoking the agreement, states like Arkansas are aligning themselves with “extremists.”

“The politicians behind these reckless policies have allied themselves with extremists who will stop at nothing to end access to abortion – breaking laws, pushing misinformation, and violence and harassment of women and doctors,” it read in part.

Arkansas is the fourth state to pull funding to Planned Parenthood, following Alabama, Louisiana and New Hampshire. As previously reported, the New Hampshire State Executive Council voted earlier this month despite objections from Gov. Mary Hassan to cancel its $650,000 contract with the abortion giant. The funds will be reallocated to other women’s health facilities.

The day prior, Louisiana Gov. Bobby Jindal announced that the state would terminate Planned Parenthood’s Medicaid contract.

“Planned Parenthood does not represent the values of the people of Louisiana and shows a fundamental disrespect for human life,” he said. “It has become clear that this is not an organization that is worthy of receiving public assistance from the state.”

The Obama administration has contended that it is illegal for states to terminate Medicaid contracts with Planned Parenthood because of its abortion services. Medicaid payments do not include abortions, but still provide support to the organization.

“Even though we anticipate a federal review, standing up for Arkansas values is most important to the governor,” spokesman J.R. Davis told the Arkansas Times.

“American tax dollars should not be used to subsidize billion-dollar corporations that inhumanely and illegally sell baby body parts,” Alliance Defending Freedom (ADF) Senior Counsel Casey Mattox said in a statement. “Tax dollars that went to two Planned Parenthood clinics in Arkansas will be better used by the 179 community health centers and other clinics that actually provide comprehensive health care. We commend the governor and hope other states will follow his example.”

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Your Daley Gator Hitlery Clinton News Roundup

Hillary Discussed Highly Sensitive Information, Now Classified “Secret,” On Her Private Email, As We Predicted – Andrew C. McCarthy

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Well, you heard it here first.

Today, the State Department released Benghazi-related email from the private server and one of the (at least) two private email accounts on which former Secretary of State Hillary Clinton conducted official business – recklessly and in violation of laws and guidelines relating to the exchanging and preservation of electronic communications. Within hours, the Obama administration was forced to concede that at least one of the emails contained classified information.

Mrs. Clinton has previously and dubiously claimed that she did not discuss classified information on her private email account(s). Despite today’s disclosure, she is standing by that claim as, apparently, is the State Department. Her rationale is that the information in question – which relates to suspects in the Benghazi attack and remains highly sensitive ­- was not classified “secret” at the time of the email exchange. Instead, it was upgraded to “secret” status just today by the FBI, which was plainly alarmed at the prospect of its disclosure.

I warned about this situation back in March, when Mrs. Clinton’s violation of federal laws and guidelines in connection with using private email to conduct official business first surfaced. The problem with the rationalization offered by Mrs. Clinton and the administration is twofold.

First, at the time of the Benghazi attack, Mrs. Clinton was secretary of state and an old hand at dealing with classified information. She thus had to have known at the time of the communication in question that information of the type she was dealing with should have been classified as “secret” even if it had not been so classified yet. Obviously, the FBI instantly recognized the significance of the information upon learning that it was about to be disclosed.

Second, it is frequently the case that highly sensitive information is not classified (or not yet classified); nevertheless, government officials are instructed that it is not to be disclosed publicly and not to be discussed on non-government email systems.

As I explained back in March:

Mrs. Clinton [in her press conference] stressed that she never stored classified documents on her private e-mail system. To the uninitiated, this sounded like the strongest point in her defense. Mostly, however, it is a red herring, exploiting the public’s unfamiliarity with how classified information works – and fueling no small amount of irresponsible speculation over the last few days about how the nature of her responsibilities meant classified material must have been stored on her private system. In the government, classified documents are maintained on separate, super-highly secured systems… [I]n general, Mrs. Clinton would not have been able to access classified documents even from a .gov account, much less from her private account – she’d need to use the classified system… That said, there are two pertinent caveats.

First, since we’re dealing with Clintonian parsing here, we must consider the distinction between classified documents and classified information – the latter being what is laid out in the former. It is not enough for a government official with a top-secret clearance to refrain from storing classified documents on private e-mail; the official is also forbidden to discuss the information contained in those documents. The fact that Mrs. Clinton says she did not store classified documents on her private server, which is very likely true, does not discount the distinct possibility that she discussed classified matters in private e-mails…

Second, most of the important but mundane information exchanged in government is not classified. It is a truism that too much information in Washington is classified. Still, it is also true that, for government officials, dealing with classified information is very inconvenient – you are usually not allowed to read it on your office computer, certainly not on your personal computer, not while commuting to work, not at home, etc. Thus, much of the information that government officials deal with is categorized as “sensitive but unclassified” (SBU).

To listen to the commentary over the past week, and to listen to Mrs. Clinton yesterday, one would think there are only two realms of government information: something is either a national defense secret or the seating chart for Chelsea’s wedding reception. Most information, though, is neither classified nor private. When I was a federal prosecutor, for instance, the SBU information I routinely dealt with included: grand-jury transcripts, the secrecy of which must be maintained by law; investigative reports by the FBI, DEA, NYPD, and other investigative agencies; wiretap affidavits that disclosed that investigations were underway, the suspects, the evidence, the wiretap locations, and the identity of government undercover agents, informants, and witnesses; memos outlining investigative or litigation strategies to deal with organized crime and terrorism organizations; plans to orchestrate arrests in multi-defendant cases where flight risk was a concern; financial information of subjects of investigations; personal information (sometimes including family financial and medical information) of lawyers and staff whom I supervised; contact information (including home addresses) of agents with whom I worked on cases often involving violent crime and public corruption; contact information (including home addresses) of judges in the event it was necessary to get a search warrant after hours; and so on.

None of that information was classified. I was permitted to – and needed to – have it ready to hand, but it was also my duty to maintain it in a secure, responsible manner… a duty that became even more important once I was a boss and was expected to set an example for junior lawyers and staff to follow. And mind you, I was just a government lawyer. I was not the secretary of state.

The inadvertent or unauthorized disclosure of SBU can do enormous damage. It can even get people killed. That is why the State Department has elaborate rules about SBU – rules that include instructing State Department employees to conduct their e-mail business via government e-mail accounts on government communications systems that have “the proper level of security control to provide nonrepudiation, authentication and encryption, to ensure confidentiality, integrity, and availability of resident information” (U.S. Dept. of State, Foreign Affairs Manual, vol. 12, sec. 544.3 ). As Fox News relates, it was on the basis of these concerns that Mrs. Clinton, as secretary of state, directed State Department employees in June 2011 to “avoid conducting official Department [business] from your personal e-mail accounts.”

Thus far, there has been disclosure of only a fraction of Mrs. Clinton’s existing private email – i.e., the email that she did not unilaterally delete despite being on notice that it was relevant to government investigations. Yet it is already clear that, as secretary of state, she did business in a way that was, at a minimum, grossly irresponsible… and quite possibly worse. She had to have realized the near certainty that an official of her stature would have been targeted for surveillance of her private emails by foreign intelligence services. Yet, in her determination not to leave a paper trail that might damage her political prospects, she ignored the risks. The Justice Department, which has prosecuted high government officials for mishandling national defense information, should be investigating – and that includes acquiring custody of Mrs. Clinton’s private server.

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Related articles:

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Krauthammer Sounds Off On Hillary Email Dump, Explains Why He Thinks ‘Whole Release Is A Farce’ – The Blaze

Conservative political pundit Charles Krauthammer reacted to the release of the first batch of Hillary Clinton emails, calling the “whole release” a “farce.”

“This is an echo of what her own press secretary said, who said there isn’t a shred of evidence. And as I’ve said there is no shred of evidence because she shredded the evidence. This whole release is a farce,” the syndicated political columnist said. “What is being released now… is stuff that was scrubbed and cleansed and decided upon, chosen by her own people, acting in her own interest, rather than… people with obligation to the public.”

“So we are getting the cleaned up version,” he continued. “And I think they are succeeding, the Clinton people. Because everybody is hungrily looking through stuff pre-scrubbed. They are not going to find anything. The Clinton’s are secretive and deceptive, but they are not stupid.”

Krauthammer then explained how he thought the process will benefit Clinton in the presidential election.

“Whatever is indicating has been scrubbed and removed. So we are going to have this long saga of the release. She will take the credit for, ‘I asked for it to be released, I wanted it to be released.’ But it’s the wrong stuff. And when people attack her later in the campaign, she will say it’s all been released, the press has looked at it,” he said.

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Hillary Slept Through Security Briefing On Benghazi Attack – Gateway Pundit

Figures.

Hillary Clinton slept through the president’s daily briefing on Benghazi. She didn’t wake up until 10:45 AM.

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What difference does it make?

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Hillary Didn’t Even Know Ambassador’s Name After He Was Murdered In Benghazi – Right Scoop

The State Department is releasing a batch of the Hillary emails, because the best way to make sure no one notices is to do it on the beginning of Memorial Day weekend. Hidden in one email is a pretty deplorable absence of interest and care from Hillary.

From the Washington Times:

The night a U.S. ambassador was killed in a terrorist attack in Benghazi, Libya, Hillary Clinton sent a message three senior State Department officials.

The recepients were Jake Sullivan, Deputy Chief of Staff to then-Secretary of State Clinton, Cheryl Mills, an adviser to Clinton’s 2008 presidential campaign and Counselor and Chief of Staff to the Secretary, and Victoria Jane Nuland, Assistant Secretary of State for European and Eurasian Affairs.

“Cheryl told me the Libyans confirmed his death. Should we announce tonight or wait until morning?” Clinton says in the email, time stamped 11:38 p.m. on Sept. 11, 2012.

The email had as its subject line: “Chris Smith.” The murdered ambassador was Chris Stevens.

The Secretary of State didn’t even know the name of the U.S. ambassador to Libya – even after terrorists stormed an American compound and killed him.

How deplorable is that. And this is who the Democrats want to make president? Disgusting.

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E-mails: Hillary Knew That State Department Asked YouTube To Block Anti-Muslim Movie Overseas – Hot Air

Not that there was ever much doubt. Three days after the Benghazi attack, the White House admitted it had pressured Google and YouTube to yank “Innocence of Muslims” as some sort of terms-of-use violation. Google refused. A week after that, having failed to twist a major corporation’s arm into censoring a politically unhelpful bit of free speech on its behalf, the State Department started running ads in Pakistan denouncing the movie, in hopes that jihadi savages would be appeased by the show of national contrition and not target any more embassies. Also around this time, YouTube did agree to censor “Innocence of Muslims” by blocking it in Egypt and Libya, the two nations that saw the most violent attacks on U.S. diplomats on September 11, 2012. Hillary Clinton had to have known about and signed off on all this, we naturally assumed. And now here’s evidence that she did: Although the message below is vague, I assume it’s referring to the ban that Google imposed on the video in Africa.

Leaning on corporate cronies to suppress Americans’ speech for political ends would be a disqualifying offense for a candidate in a sane world.

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Fun fact: On the very day that e-mail was sent, the man who made “Innocence of Muslims” was arrested by the feds on a “parole violation.” Hillary’s leisure reading in the weeks before that was interesting too:

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Clinton Foundation Discloses Millions In Additional Payments Under Pressure – Big Government

From the Washington Post:

The Clinton Foundation reported Thursday that it has received as much as $26.4 million in previously undisclosed payments from major corporations, universities, foreign sources and other groups.

Thursday’s disclosure is one of a number of instances in recent weeks in which the foundation has acknowledged that it received funding from sources not disclosed on its Web site.

The ethics agreement was reached between the foundation and the Obama administration to provide additional transparency and avoid potential conflicts of interest with Hillary Clinton’s appointment as secretary of state.

The agreement placed restrictions on foreign government donations, for instance, but the foundation revealed in February that it had violated the limits at one point by taking $500,000 from Algeria.

There was one entity clearly associated with a foreign government that provided speaking fees, of $250,000 to $500,000 for a speech by Bill Clinton: The energy ministry in Thailand.

The U.S. Islamic World Forum also provided $250,000 to $500,000 to the foundation for a speech by Bill Clinton, according to the new disclosure. The event was organized in part by the Brookings Institution with support from the government of Qatar.

In addition, the list is studded with overseas corporations and foundations.

They included the South Korean energy and chemicals conglomerate Hanwha, which paid $500,000 to $1,000,000 for a speech by Bill Clinton.

China Real Estate Development Corp. paid the foundation between $250,000 and $500,000 for a speech by the former president. The Qatar First Investment Bank, now known as the Qatar First Bank, paid fees in a similar range. The bank is described by Persian Gulf financial press as specializing in high-net-worth clients.

The Telmex Foundation, founded by Mexican billionaire Carlos Slim, provided between $250,000 and $500,000 for a speech by Hillary Clinton.

Read the rest of the story here.

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Department Of Veterans Affairs Official Paid $288K In ‘Relocation Payments’ To Move 140 Miles

VA Official Paid $288K In ‘Relocation Payments’ To Move 140 Miles – Daily Caller

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The director of the Philadelphia VA regional benefits office was paid $288,000 in “relocation payments” to move the 140 miles from Washington, D.C. to her new home last year.

Diana Rubens was tapped last June to take over the Philadelphia regional benefits office, which is one of many VA hospitals and benefits offices currently being investigated over benefits claims.

Rubens, who previously served as the D.C.-based deputy undersecretary for field operations, where she oversaw 57 regional offices, was brought in to help fix the embattled Philadelphia facility.

A breakdown of Rubens’ “relocation payments” was not immediately available, according to the Philadelphia Inquirer, but a VA spokesman said that there was nothing inappropriate with the spending.

Federal regulations allow for the reimbursement of relocation expenses including the “costs of house-hunting, moving, terminating leases, and a per-diem rate for meals and temporary housing for an employee and his or her family,” the spokesman said.

But that hefty repayment is nearly 160 percent of what Rubens earned in base pay all of last year, raising questions over what exactly that money could have gone towards.

Rubens was paid more than $181,000 in 2014, according to the website FedSmith.com, which maintains a database of federal employee compensation.

“The government shouldn’t be in the business of doling out hundreds of thousands in cash to extremely well-compensated executives just to move less than three hours down the road,” Florida Rep. Jeff Miller, the chairman of the House Committee on Veterans’ Affairs, told the Inquirer.

“For VA to pay such an outrageous amount in relocation expenses at a time when the department is continually telling Congress and taxpayers it needs more money raises questions about VA’s commitment to fiscal responsibility, transparency and true reform.”

Rubens has been mentioned before in articles criticizing other money she’s been paid by the VA. According to the Center for Investigative Reporting, in 2011, she received a bonus of more than $23,000 even though patient backlogs – one area Rubens was in charge of managing – increased by 300,000.

The Washington Examiner reported last year that Rubens received more than $97,000 in bonuses between 2007 and 2011 even though the average time to process veterans’ claims doubled to 325 days on her watch. The ratio of backlogged cases nearly doubled as well, from 37 percent in 2009 to 71 percent in 2013.

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Federal Government Shelled Out $125B In Bogus Payments Last Year

Feds Shelled Out $125B In Bogus Payments Last Year – Washington Times

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The government paid out $124.7 billion in potentially bogus payments last year, the government’s chief watchdog said Monday, blaming a controversial tax credit for the poor as well as increased bad payments in Medicare and Medicaid.

One major problem is tracking when Americans die – the Social Security Administration admitted last week that its rolls are filled with names of more than 6 million folks who are listed as 112 years of age or older.

The Government Accountability Office said Social Security has trouble maintaining the Death Master File, and other agencies have difficulties in getting the information to update their own files and halt payments to those no longer alive to collect benefits.

SEE ALSO: Rand Paul emerges as the harshest GOP critic of Clinton emails

At the same time, being improperly listed on the Death Master File can cause nightmares, said Judy C. Rivers, a woman who has twice been erroneously listed, leaving her denied for jobs, rejected for apartments and forced to live in her car.

At one point she spent an hour haggling with a bank that was refusing to open an account for her but wouldn’t tell her why. Eventually the manager told Ms. Rivers her Social Security number had been listed by the federal agency as deactivated “due to death.”

“The Death Master File has been like a propagating hydra underlying all my problems,” she told the Senate Homeland Security and Governmental Affairs Committee.

SEE ALSO: VA refusing to comply with Congress on transparency, reforms, lawmakers say

It took her four years to clear up enough of the problems that she was able to be approved for a credit card again.

Social Security’s inspector general said a 2008 investigation found more than 20,000 people who were wrongly listed in the death file.

The agency says its hands are tied and it must release some information about those in its death file in response to open-records requests, leaving those erroneously listed open to even more fraud if an unscrupulous actor gets their number and realizes they are still alive.

Social Security insists it hasn’t found an instance where someone’s identity was compromised solely because of being wrongly listed.

Sean Brune, senior adviser to the deputy Social Security commissioner, said less than half a percent of the 2.8 million new death reports they get each year are inaccurate.

The agency gets its information from banks, post offices, and federal and state agencies that pay out benefits, such as the Veterans Affairs Department or Medicare.

Social Security paid out a little more than $8 billion in improper payments last year, according to GAO investigators. The supplemental security income program had a 9.2 percent error rate, while the retirement benefits program had a much smaller error rate of four-tenths of a percent.

The biggest problems, however, came at Medicare, whose basic fee-for-service program paid out $45.8 billion in improper payments, or nearly 13 percent of its outlays, and the Earned Income Tax Credit, which botched 27.2 percent of its payments, for a total of $17.7 billion, the GAO said.

Medicaid, Medicare Advantage and unemployment insurance rounded out the top five worst programs in terms of dollars spent on potentially bogus payments.

The government paid out $124.7 billion in potentially bogus payments last year, the government’s chief watchdog said Monday, blaming a controversial tax credit for the poor as well as increased bad payments in Medicare and Medicaid.

One major problem is tracking when Americans die – the Social Security Administration admitted last week that its rolls are filled with names of more than 6 million folks who are listed as 112 years of age or older.

The Government Accountability Office said Social Security has trouble maintaining the Death Master File, and other agencies have difficulties in getting the information to update their own files and halt payments to those no longer alive to collect benefits.

SEE ALSO: Rand Paul emerges as the harshest GOP critic of Clinton emails

At the same time, being improperly listed on the Death Master File can cause nightmares, said Judy C. Rivers, a woman who has twice been erroneously listed, leaving her denied for jobs, rejected for apartments and forced to live in her car.

At one point she spent an hour haggling with a bank that was refusing to open an account for her but wouldn’t tell her why. Eventually the manager told Ms. Rivers her Social Security number had been listed by the federal agency as deactivated “due to death.”

“The Death Master File has been like a propagating hydra underlying all my problems,” she told the Senate Homeland Security and Governmental Affairs Committee.

It took her four years to clear up enough of the problems that she was able to be approved for a credit card again.

Social Security’s inspector general said a 2008 investigation found more than 20,000 people who were wrongly listed in the death file.

The agency says its hands are tied and it must release some information about those in its death file in response to open-records requests, leaving those erroneously listed open to even more fraud if an unscrupulous actor gets their number and realizes they are still alive.

Social Security insists it hasn’t found an instance where someone’s identity was compromised solely because of being wrongly listed.

Sean Brune, senior adviser to the deputy Social Security commissioner, said less than half a percent of the 2.8 million new death reports they get each year are inaccurate.

The agency gets its information from banks, post offices, and federal and state agencies that pay out benefits, such as the Veterans Affairs Department or Medicare.

Social Security paid out a little more than $8 billion in improper payments last year, according to GAO investigators. The supplemental security income program had a 9.2 percent error rate, while the retirement benefits program had a much smaller error rate of four-tenths of a percent.

The biggest problems, however, came at Medicare, whose basic fee-for-service program paid out $45.8 billion in improper payments, or nearly 13 percent of its outlays, and the Earned Income Tax Credit, which botched 27.2 percent of its payments, for a total of $17.7 billion, the GAO said.

Medicaid, Medicare Advantage and unemployment insurance rounded out the top five worst programs in terms of dollars spent on potentially bogus payments.

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Federal Government Made $100B In Improper Payments To Unentitled Recipients

Government Made $100B In Improper Payments – Associated Press

By its own estimate, the government made about $100 billion in payments last year to people who may not have been entitled to receive them – tax credits to families that didn’t qualify, unemployment benefits to people who had jobs and medical payments for treatments that might not have been necessary.

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Congressional investigators say the figure could be even higher.

The Obama administration has reduced the amount of improper payments since they peaked in 2010. Still, estimates from federal agencies show that some are wasting big money at a time when Congress is squeezing agency budgets and looking to save more.

“Nobody knows exactly how much taxpayer money is wasted through improper payments, but the federal government’s own astounding estimate is more than half a trillion dollars over the past five years,” said Rep. John Mica, R-Fla. “The fact is, improper payments are staggeringly high in programs designed to help those most in need – children, seniors and low-income families.”

Mica chairs the House Oversight subcommittee on government operations. The subcommittee is holding a hearing on improper payments Wednesday afternoon.

Each year, federal agencies are required to estimate the amount of improper payments they issue. They include overpayments, underpayments, payments to the wrong recipient and payments that were made without proper documentation.

Some improper payments are the result of fraud, while others are unintentional, caused by clerical errors or mistakes in awarding benefits without proper verification.

In 2013, federal agencies made $97 billion in overpayments, according to agency estimates. Underpayments totaled $9 billion.

The amount of improper payments has steadily dropped since 2010, when it peaked at $121 billion.

The Obama administration has stepped up efforts to measure improper payments, identify the cause and develop plans to reduce them, said Beth Cobert, deputy director of the White House budget office. Agencies recovered more than $22 billion in overpayments last year.

“We have strengthened accountability and transparency, saving the American people money while improving the fiscal responsibility of federal programs,” Cobert said in a statement ahead of Wednesday’s hearing. “We are pleased with this progress, but know that we have more work to do in this area.”

However, a new report by the Government Accountability Office questions the accuracy of agency estimates, suggesting that the real tally could be higher. The GAO is the investigative arm of Congress.

“The federal government is unable to determine the full extent to which improper payments occur and reasonably assure that appropriate actions are taken to reduce them,” Beryl H. Davis, director of financial management at the GAO, said in prepared testimony for Wednesday’s hearing.

Davis said some agencies don’t develop estimates for programs that could be susceptible to improper payments. For example, the Health and Human Services Department says it cannot force states to help it develop estimates for the cash welfare program known as Temporary Assistance for Needy Families. The program is administered by the states.

The largest sources of improper payments are government health care programs, according to agency estimates. Medicare’s various health insurance programs for older Americans accounted for $50 billion in improper payments in the 2013 budget year, far exceeding any other program.

Most of the payments were deemed improper because they were issued without proper documentation, said Shantanu Agrawal, a deputy administrator for the Centers for Medicare & Medicaid Services. In some cases, the paperwork didn’t verify that services were medically necessary.

“Payments deemed `improper’ under these circumstances tend to be the result of documentation and coding errors made by the provider as opposed to payments made for inappropriate claims,” Agrawal said in prepared testimony for Wednesday’s hearing.

Among other programs with large amounts of improper payments:

– The earned income tax credit, which provides payments to the working poor in the form of tax refunds. Last year, improper payments totaled $14.5 billion. That’s 24 percent of all payments under the program.

The EITC is one of the largest anti-poverty programs in the U.S., providing $60.3 billion in payments last year. Eligibility depends on income and family size, making it complicated to apply for the credit – and difficult to enforce, said IRS Commissioner John Koskinen.

“EITC eligibility depends on items that the IRS cannot readily verify through third-party information reporting, including marital status and the relationship and residency of children,” Koskinen told a House committee in May. “In addition, the eligible population for the EITC shifts by approximately one-third each year, making it difficult for the IRS to use prior-year data to assist in validating compliance.”

– Medicaid, the government health care program for the poor. Last year, improper payments totaled $14.4 billion.

Medicaid, which is run jointly by the federal government and the states, has seen a steady decline in improper payments since 2010, when they peaked at $23 billion.

The program is expanding under President Barack Obama’s health law.

– Unemployment insurance, a joint federal-state program that provides temporary benefits to laid-off workers. Amount of improper payments last year: $6.2 billion, or 9 percent of all payments.

The Labor Department said most overpayments went to people who continued to get benefits after returning to work, or who didn’t meet state requirements to look for work while they were unemployed. Others were ineligible for benefits because they voluntarily quit their jobs or were fired.

– Supplemental Security Income, a disability program for the poor run by the Social Security Administration. Amount of improper payments: $4.3 billion, or 8 percent of all payments.

Social Security’s much larger retirement and disability programs issued $2.4 billion in improper payments, according to agency estimates. Those programs provided more than $770 billion in benefits, so improper payments accounted for less than 1 percent.

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Medicaid Made $14.4B In Improper Payments In 2013

Medicaid Made $14.4 Billion Improper Payments Last Year – Washington Free Beacon

The federal government paid out $14.4 billion in fraudulent reimbursements through Medicaid last year, according to the Government Accountability Office (GAO).

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………………………………….Medicare and Medicaid chief Marilyn Tavenner

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Sen. Orrin Hatch (R., Utah) highlighted a recent GAO report on the lack of oversight within Medicaid’s managed care organizations (MCOs) delivery system, which accounts for roughly $4 billion in waste each year.

“Today’s report is particularly troubling given Obamacare expands this broken program without substantial reforms to protect patients and taxpayers,” Hatch said in a statement Wednesday. “CMS is responsible for safeguarding the billions of dollars it receives from hard-working American taxpayers, and I strongly urge [CMS] Administrator [Marilyn] Tavenner to implement the changes recommended by GAO to improve CMS oversight of MCO payments.”

“This report underscores the need for Medicaid reform in order to ensure that scarce tax dollars are used properly,” he said.

Managed care organizations, in which Medicaid beneficiaries get the majority of their care through an organization under contract with their state, are especially vulnerable to fraud since neither federal nor state governments are “well positioned to identify improper payments,” the GAO said.

“The size and diversity of the Medicaid program make it particularly vulnerable to improper payments – including payments made for treatments or services that were not covered by program rules, that were not medically necessary, or that were billed for but never provided,” the report said.

Nearly 50 million people currently receive benefits through MCOs. While MCO payments are still overshadowed by fee-for-service payments (FFS) – the traditional method where health care providers are paid for each service – individuals receiving their care through MCOs are “growing at a faster rate.”

State officials told the GAO that they have “not begun to closely examine program integrity in Medicaid managed care.” While the Centers for Medicaid and Medicare Services (CMS) requires states to audit their payments according to their MCO contracts, states are not required to audit the “appropriateness of these payments.”

The GAO warned that the problem would worsen under Obamacare, which has expanded Medicaid programs in many states.

“Improving federal and state efforts to strengthen Medicaid managed care program integrity takes on greater urgency as states that choose to expand their Medicaid programs under the Patient Protection and Affordable Care Act are likely to do so with managed care arrangements, and will receive a 100 percent federal match for newly eligible individuals from 2014 through 2016,” the report said.

“Unless CMS takes a larger role in holding states accountable, and provides guidance and support to states to ensure adequate program integrity efforts in Medicaid managed care, the gap between state and federal efforts to monitor managed care program integrity will leave a growing portion of federal Medicaid dollars vulnerable to improper payments,” it said.

Overall, Medicaid covered 71.7 million Americans in fiscal year 2013, totaling $431.1 billion, an estimated $14.4 billion of which were improper payments.

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