Russell Vought’s Medicaid Claims: What’s True About ‘Improper’ Payments?
On June 1, 2025, during CNN’s “State of the Union,” Russell Vought, the director of the Office of Management and Budget, made headlines with a bold claim: nearly one out of every five or six dollars spent on Medicaid is an “improper” payment. His statement came amid heated debates about President Donald Trump’s tax and spending plan, which critics say would slash Medicaid coverage for millions of Americans. Trump administration officials, however, have defended the bill by insisting it only targets “waste, fraud, and abuse.”
But what does “improper payments” actually mean — and are Vought’s numbers accurate?
Breaking Down ‘Improper Payments’
An “improper” payment is a catch-all term for funds that are paid incorrectly — whether that’s to ineligible beneficiaries, duplicate claims, payments for services never rendered, or missing proper documentation. It’s important to note that “improper” does not necessarily mean “fraudulent.” Fraud involves intentional deception, while improper payments can result from innocent mistakes, paperwork mishaps, or administrative oversights.
When CNN host Dana Bash asked Vought about concerns that the bill could hurt low-income Americans, he dismissed such worries as “completely absurd.” He doubled down on his claim: “One out of every $5 or $6 in Medicaid payments is improper.”
If true, that would put the Medicaid improper payment rate between 16% and 20%.
The Official Numbers vs. Vought’s Claim
The Centers for Medicare & Medicaid Services (CMS), which oversees Medicaid, released a report in 2024 reviewing payments from 2022 through 2024. Their data showed the improper payment rate at about 5.1%, far lower than Vought’s figure. This 5.1% corresponded to roughly $31 billion in improper payments out of the billions Medicaid handles annually.
Notably, this 5.1% figure represents a decline from the 8.58% rate reported the previous year — marking three years of steady improvement.
What Do the Experts Say?
Some experts argue the official CMS numbers might underestimate the true extent of improper payments. For example, the conservative-leaning Paragon Health Institute published a report suggesting that flawed eligibility checks in past years could mean the actual improper payment rate might be as high as 25%.
Brian Blase, a former Trump health advisor and co-author of the report, pointed out that CMS’s analysis skipped some years of rigorous eligibility audits. If those audits had been consistent, he argued, more ineligible claims might have been uncovered — boosting the improper payment rate.
However, Jennifer Wagner from the Center on Budget and Policy Priorities, a liberal think tank, cautions that Medicaid enrollment and eligibility rules fluctuate year to year, which could explain spikes and drops in improper payments. She warns that generalizing from two years of data to a decade-long trend is unreliable.
Robert Westbrooks, head of the Pandemic Response Accountability Committee, echoed this uncertainty: while it’s plausible CMS rates are too low, “no one can credibly measure the difference.”
Why ‘Improper’ Doesn’t Mean ‘Fraud’
CMS defines:
- Fraud as deliberate deception to gain money or property.
- Waste as overuse of services causing unnecessary costs.
- Abuse as actions causing needless costs, like overbilling or misusing billing codes.
In contrast, improper payments can include innocent errors — like missing paperwork or administrative slip-ups. According to CMS, nearly 79% of improper payments happened because required documentation was missing, not because someone was trying to scam the system.
Most fraud in Medicaid tends to be committed by providers, not patients. As Jennifer Wagner explains, “The vast majority of fraud is committed by providers or other actors, not enrollees.”
Our Take
Russell Vought’s claim that 16% to 20% of Medicaid payments are improper oversimplifies a complex issue. While the official government rate stands closer to 5%, experts acknowledge that the real figure could be somewhat higher — though likely nowhere near 25%.
In short, the statement contains a grain of truth, but it ignores important facts and nuances. Given the evidence, we rate it Mostly False.
If you want to understand Medicaid payments better, it helps to see beyond the headlines and grasp the difference between honest mistakes and outright fraud — a distinction that often gets lost in political debates.