(LibertySociety.com) – Taxpayers have funded health insurance for dead people for years due to government inefficiency, but new reforms promise to end this outrageous waste under President Trump’s fiscal accountability push.
Story Highlights
- Federal agencies paid billions in improper benefits to deceased individuals because of fragmented death data and lax eligibility checks.
- 2025 budget reconciliation law mandates quarterly Death Master File checks for Medicaid enrollees and providers, cutting wasteful spending.
- Senate passes Wyden-Kennedy-Peters Act to permanently enable SSA-Treasury data sharing, building on $31 million already recovered.
- States face federal funding cuts for improper payments, enforcing accountability after decades of mismanagement.
Government Waste Exposed in Health Programs
Federal watchdogs identified billions in improper payments for Medicaid, Medicare, and other benefits issued after beneficiaries died. Agencies failed to cross-check death records promptly due to fragmented state-federal systems and limited data-sharing authority. States administered Medicaid with inconsistent eligibility verification, allowing capitation payments to continue for deceased enrollees. This waste stemmed from infrequent checks and historical privacy barriers limiting access to the Social Security Administration’s Death Master File.
Recent Reforms Target Post-Death Payments
The 2025 budget reconciliation law enacts deep Medicaid cuts alongside program integrity measures. Section 71104 requires states to review the Death Master File quarterly starting January 1, 2027, to remove deceased enrollees. States must also check providers quarterly from January 1, 2028. HHS will reduce federal matching funds for improper payments to ineligible individuals or overpayments starting October 1, 2029, with CBO estimating $8 billion in savings over ten years.
Why is the government paying for dead people’s health insurance? https://t.co/XP9ecldGkA
— TheHillOpinion (@TheHillOpinion) December 12, 2025
Bipartisan Push for Permanent Fixes
Senator John Kennedy’s temporary Stopping Improper Payments to Deceased People Act enabled SSA to share the Death Master File with Treasury’s Do Not Pay system. Treasury recovered $31 million in fraud and improper payments within five months by January 2025. On September 26, 2025, the Senate passed the Wyden-Kennedy-Peters Ending Improper Payments to Deceased People Act to make this sharing permanent across federal agencies. Sponsors highlight safeguarding taxpayer dollars through enhanced payment screening.
These reforms address longstanding GAO findings on post-death billing in Medicare and managed care capitation in Medicaid. Bipartisan support from Senators Wyden, Kennedy, Peters, Ernst, and others reflects consensus on fiscal responsibility. Centers for Medicare & Medicaid Services and state agencies must now update systems, balancing integrity with coverage accuracy to prevent wrongful terminations.
Trump Era Delivers Fiscal Wins for Taxpayers
President Trump’s administration prioritizes ending government overreach and waste, aligning with these laws amid broader Medicaid spending reductions. CBO projects millions fewer uninsured from tightened eligibility, countering past fiscal mismanagement that fueled inflation. Treasury’s Do Not Pay system strengthens as states face penalties, ensuring benefits serve living Americans. This progress validates conservative demands for limited government and individual accountability, protecting family budgets from bureaucratic excess.
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