Identifying Wasteful Spending Doesn’t Have to be Partisan

Taxpayers have been accustomed to Republicans talking about government waste and identifying where to cut out the fat.  In some cases, Democrats have even given up on looking and claim that it is tough to identify where the waste, fraud, and abuse is occurring.  For example, after Rep. Barney Frank (D-Mass.) announced his retirement he was interviewed by Chris Matthews on MSNBC.  When asked about where government could cut, Rep. Frank responded that “People say we are going to cut out the fat as if the fat was made on the side. Yes, there`s fat, but it`s marbles. There`s inefficiency in any human activity –the waste, fraud, and abuse is so marbled throughout the government and the various bureaucracies that it is difficult to get rid of the waste.”  Besides the ridiculous story of a welfare recipient owning a $1.2 million house (read here), there are plenty of examples from members of both parties about where to trim the fat.

Two vastly different sources, Sen. Tom Coburn (R-Okla.) and Dr. Donald M. Berwick (President Obama’s choice to be administrator of the Centers for Medicare and Medicaid Services, the entity that runs health programs which insures almost one-third of all Americans) disagree with Rep. Frank and shows that Democrats and Republicans can find waste.  In a report titled “Subsidies of the Rich and Famous,” Sen. Coburn details $39 billion in handouts and tax breaks for millionaires.  In a New York Times article about the departure of Dr. Berwick from the federal government, the paper noted that, “The official in charge of Medicare and Medicaid for the last 17 months says that 20 percent to 30 percent of health spending is ‘waste’ that yields no benefit to patients, and that some of the needless spending is a result of onerous, archaic regulations enforced by his agency.”

Sen. Coburn’s involvement in exposing government waste and inefficiency comes as no surprise since Sen. Coburn has long been a champion of exposing and eliminating government waste.  Dr. Berwick’s admission is a bit more startling and should be listened to very carefully.  Dr. Berwick estimates that 20 to 30 percent of Medicare and Medicaid is lost due to waste.  In 2010, it was estimated that the federal government spent $528 billion for Medicare.  If Dr. Berwick is correct, that means that upwards of $158 billion is being wasted.  As for Medicaid, 30 percent of the $273 billion spent on Medicaid in 2010 would equate to $82 billion.  Combine Medicare and Medicaid together and you would have a potential savings of $240 billion in one year.  This is double the estimate of the $1.2 trillion over ten years ($120 billion per year) that the Super Committee was supposed to cut.

According to the New York Times, Dr. Berwick “listed five reasons for what he described as the ‘extremely high level of waste.’ They are overtreatment of patients, the failure to coordinate care, the administrative complexity of the health care system, burdensome rules and fraud. ‘Much is done that does not help patients at all,’ Dr. Berwick said, ‘and many physicians know it.’”  Dr. Berwick is by no means a Republican lackey.  As mentioned earlier, he was hand-picked by President Obama and criticized the Republicans for their opposition to Obamacare.