Coats Highlights Billions in Federal Contracts Overdue for Closure

WASHINGTON, DC – Senator Dan Coats (R-Ind.), the Chairman of the Joint Economic Committee, delivered his weekly “Waste of the Week” speech and highlighted more than $25 billon that have not been properly accounted for by the Centers for Medicare and Medicaid Services (CMS), a part of the Department of Health and Human Services (HHS).

Coats said that private sector contractors partner with CMS to provide a number of products and services to beneficiaries. Federal agencies administer these contracts and are required to track the contracts’ progress and costs and then close out these accounts once the contracts are complete. Federal regulations require agencies to close out the majority of completed contracts within 20 months – with a handful of exceptions for some that may take more time.

In December, the HHS Inspector General issued a report noting that CMS has over 6,000 completed contracts totaling more than $25 billion in funding that are all overdue, meaning they have not been closed, which makes CMS vulnerable to improper payments.

“Shockingly, fifteen percent of the completed contracts remained more than 10 years overdue, and CMS could provide adequate information for less than one percent of them,” said Coats. “Even worse, the system that CMS has in place to monitor these contracts isn’t accessible to the bureau within HHS responsible for closing the contracts. Needless to say, this lack of accessibility makes it unnecessarily difficult to close these accounts.”

Click here to watch Coats speak on the Senate floor.