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Are Medicare and Medicaid 'paid to crooks?'

By the CNN Wire Staff
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(CNN) -- The statement:

"The federal government is such a bad manager of money that somewhere between 70 and $120 billion a year in Medicare and Medicaid is paid to crooks ... I would start to balance the budget by stop paying the crooks, not by cheating honest Americans."

-- former House Speaker Newt Gingrich, a Monday night's CNN-Tea Party Republican debate

The facts:

The federal government estimates that in 2010, about 5.5% of its spending -- about $125 billion -- involved "improper payments" to businesses or individuals.

About $70 billion came from Medicare, the federal health program for seniors, and Medicaid, which provides medical insurance for low-income Americans. Those programs involve more than $660 billion.

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But "improper payments" is a broad category that not only includes fraud, but administrative errors and overpayments.

The verdict:

Misleading. The low end of Gingrich's claim of Medicare and Medicaid fraud losses is roughly what the federal government has reported for erroneous payments -- but since the figure includes ordinary clerical mistakes, the former speaker's estimate likely overstates the actual amount lost to "crooks."

CNN's Matt Smith and Lindsey Knight contributed to this report.

 
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