The Government Accountability Office (GAO) on June 26, 2025 released a report that showed a zero percent improper payment rate in Medicaid managed care.

Improper payments to managed care companies are those that were made in the wrong amount, should not have been made, or were made with insufficient documentation.

GAO concludes that, through review of state documentation, it didn’t determine demonstrable improper Medicaid payments in managed care, though improper payment totaling more than $31 billion were attributable to fee for service or eligibility criteria.

While nearly 95% of Medicaid Payments in 2024 were proper, the report chooses to juxtapose the difference in error rates for Medicaid managed care and other categories for which the data review is more comprehensive and the opportunities for error are far higher. Error rate calculations in managed care do not consider participant-level diagnosis data, capitation rates do not vary per individual, nor do states pay thousands of managed care organizations as they do providers in fee for service.

The framing of the report paints managed care as a more judicious and responsible manner of program administration because of the zero payment-error rate. The report does outline these caveats and how the Medicaid payment error rate methodology is different from Medicare Advantage as it doesn’t look at direct enrollee health information to determine the capitation rate.

Overall, the report paints payment errors as indications of possible nefarious actions, when they are most often insignificant human clerical errors that are later remedied.

The full report is available here.