The $500 Billion Fix: Innovative Solutions to Improve Government Service Delivery and Stop Systemic Government Waste Over the Next Decade
The Problem: Systemic Government Waste Costs Taxpayers Billions — Adding Up to Half a Trillion Dollars Over 10 Years
Every year, American taxpayers lose tens of billions of dollars due to mismanaged, outdated, and wasteful government systems. Medicaid, SNAP, the Earned Income Tax Credit (EITC), workforce development programs, and Medicare Advantage are plagued by improper payments, fragmented oversight, and duplicative infrastructure. These are not isolated errors — they are systemic failures, well‑documented by the Government Accountability Office (GAO), the Centers for Medicare & Medicaid Services (CMS), the USDA, and the IRS.
Agencies estimate $162 billion in improper payments — including fraud — in the past year, according to recent GAO testimony. Targeted, immediately actionable reforms could realistically recover billions each year. Over a decade, that amounts to $500 billion in preventable losses — an eye‑opening sum that equals entire annual federal department budgets.
The Solution: Proven, Immediate, Scalable
These solutions build directly on actions the administration is already taking through the recent Executive Order — Protecting America’s Bank Account Against Fraud, Waste, and Abuse (March 25, 2025) — which mandates immediate steps to tighten payment verification, consolidate financial systems, and combat systemic improper payments. This paper outlines practical ways to accelerate and scale these administration priorities. These priorities are already being advanced by the President’s team — this paper shows how to expand and accelerate their impact.
These reforms are not speculative. They are tested and ready to begin to scale. Fully implemented across agencies and states, they have the potential to reclaim up to $500 billion saved over the coming decade.
Medicaid Improved Eligibility Verification — Estimated Annual Savings: More than $1 Billion
Medicaid improper payments totaled $31.1 billion in FY 2024 alone, partially due to unverifiable or outdated eligibility checks and lack of data sharing among state and local agencies, often resulting in individuals being enrolled by multiple jurisdictions. Creating a Medicaid National Accuracy Clearinghouse (NAC), modeled on item 2 below, would enable comprehensive real‑time eligibility verification nationwide, ensuring every dollar reaches the truly eligible. Over 10 years, a fully deployed NAC could net $10–12 billion.
Sources: CBO preliminary estimate 2025; GAO‑25‑108172
SNAP National Accuracy Clearinghouse (NAC) — Estimated Annual Savings: $500 Million
SNAP improper payments surpassed $10.5 billion in FY 2023. The NAC addresses a specific loophole: duplicate benefits across states due to lack of intra‑jurisdictional data sharing. Fully deployed, NAC would stop a major subset of SNAP fraud and erroneous payments. Preliminary CBO estimate: $6.5–7 billion over 10 years.
Sources: GAO‑25‑108172; CBO preliminary estimate 2025
EITC Pre‑Filing Eligibility Verification — Estimated Annual Savings: $10–21.9 Billion
The IRS issues more than $15.9 billion annually in improper EITC payments, largely due to unverifiable income, incorrect filing by commercial tax preparers, or ineligible dependents. Pre‑filing checks using existing federal data and limits on commercial tax filers would end “pay‑and‑chase” cycles. Over 10 years, that could amount to $100– 150 billion in recaptured funds.
Sources: GAO‑23‑106057; IRS EITC Improper Payments Fact Sheet
Unified Death Notification System — Estimated Annual Savings: $2–3 Billion
SSA maintains a separate death database that is not updated in real time or shared with federal or state benefit programs, nor permanently with Treasury’s Do Not Pay system. A unified death record system would prevent billions in improper payments to deceased individuals across multiple federal benefit programs — potentially $20–30 billion over a decade.
Sources: GAO‑25‑108172; TIGTA reports on Economic Impact Payments to the deceased
Independent Medicare Enrollment Verification — Estimated Annual Savings: $8–25 Billion
Medicare Advantage plans are overpaid by billions each year — between $12 billion and $25 billion — due to inflated or unverified diagnostic coding and risk adjustment. Strengthening oversight, conducting rigorous audits, and enforcing independent enrollment checks could reclaim up to $250 billion over 10 years. Even a modest effort could yield over $80 billion.
Sources: MedPAC reports; GAO‑23‑105720
Total Potential Over 10 Years: $500 Billion
This is the scale of what’s possible when these proven reforms are implemented immediately — not incrementally.
Taken together, these reforms — Medicaid eligibility checks, SNAP NAC, EITC pre‑filing verification, a timely Unified Death Notification System, rigorous Medicare Advantage oversight — can deliver billions annually in recovered or prevented improper payments. Over a decade, that equals at least $500 billion — potentially more if states and agencies adopt the reforms aggressively.
Even partial success — capturing half the targeted overpayments — produces hundreds of billions in savings, far exceeding the cost of new IT systems or oversight staff.
Implementation: What Government Must Do
Many of these initiatives were initially championed by the Department of Government Efficiency (DOGE); today, they are being actively integrated into operations led by OMB, ensuring continued momentum and impact.
These solutions require no groundbreaking legislation — only the will to execute.
Specifically:
Mandate Real-Time Eligibility Verification: Use executive orders or agency directives to require real-time data checks across Medicaid, SNAP, and other means-tested programs.
Direct Full NAC Rollout: Provide states with incentives to connect to the National Accuracy Clearinghouse, eliminating cross-state benefit duplication.
Establish a Central Death Notification Hub: Make SSA and Treasury the gatekeepers of a permanent, single, real-time death data feed shared with all benefit-paying agencies and the Do Not Pay system.
Aggressively Audit Medicare Advantage: Expand risk-adjustment audits, recoup known overpayments, and enforce independent checks on diagnostic coding.
Enforce Outcome-Based Contracting: Tie vendor payments to documented fraud reduction or program‑integrity improvements while minimizing burdens on qualified beneficiaries.
The Cost of Inaction Is Unsustainable
Each day of delay costs taxpayers tens of millions of dollars. Previous pilot projects and waivers haven’t gone far enough or fast enough. Systemic reform is the only way to uproot these embedded inefficiencies. Reducing costs by as much as $500 billion is possible while improving service to recipients and eliminating bureaucratic barriers.
Over 10 years, failure to act could cost more than $500 billion — undermining public trust in government and straining budgets that fund vital services.
A Decade of Impact
We do not need new inventions — just the courage to scale what already works.
The federal government has both the tools and the authority to act now. Over the next decade, these six reforms can transform the integrity, efficiency, and accountability of America’s largest benefit programs.
The choice is not between delivering services and saving money — it’s between decisive leadership and beneficiary service and financial indifference.
Act boldly — and reclaim up to $500 billion for taxpayers over the next 10 years.