VA reduces improper payments for private health care by 98% since 2020, GAO finds

The Department of Veterans Affairs has slashed improper payments to private companies that provide medical care to veterans by 98%, reducing the amount from $7.5 billion to $608 million in five years, according to data provided to government auditors by the VA.

In a report released Tuesday, Government Accountability Office analysts said that although the VA outlays for the Community Care Program have risen from $9.5 billion in 2020 to $25 billion in 2025, the amount of improper payments have been reduced each year, from 78% of the total in 2020 to 2.4% in 2025.

The GAO said improper payments occur when the VA reimburses contractors that manage community care for outdated claims, incorrect reimbursement rates or payment amounts or bills that exceed authorized care.

Sometimes, the improper payments may be related to fraud, the GAO added, noting that as recently as February 2026, a home health care company submitted fraudulent claims for community care for $100,000 in services that were never provided. In another case, a provider agreed to pay $3.7 million to resolve charges that it fraudulently billed the VA for services that were not medically necessary.

The VA has worked to reduce improper payments and fraud risks, the GAO noted, by developing and implementing processes for identifying problems and assessing the root causes of improper payments.

The department developed and implemented corrective actions to address the issues, the analysts said.

The VA has not, however, conducted a fraud-risk assessment that identifies inherent risks, assesses the likelihood of fraud and determines its risk tolerance. GAO auditors recommended the VA create a fraud-risk framework and implement it.

“While VA has taken steps to identify and assess fraud risks, these efforts do not meet the key elements of a fraud risk assessment and have not resulted in a comprehensive fraud risk assessment for the program, leaving it vulnerable to fraud,” the report stated.

VA officials told the GAO that they were able to reduce improper payments in Community Care because they addressed the “broader system and policy issues,” such as payment processing errors and eligibility problems that followed the development of the nationwide program established in 2018 by the Mission Act.

VA officials said they would further address any issues that may contribute to improper payments in the next round of contracts for Community Care, which are expected to be awarded this year.

VA officials concurred with the GAO’s recommendation to create a fraud-risk framework, saying the department would establish oversight during its ongoing reorganization of the Veterans Health Administration, with the effort to be completed by March 2028.

The GAO also looked at improper payments by the Centers for Medicare and Medicaid Services to companies that manage Medicare Advantage plans. Analysts found that in 2025, CMS paid roughly $23.7 billion in improper payments, up from $16.3 billion in 2020.