	2013 Annual Report Identifies 31 New Areas to Achieve Greater Efficiency or Effectiveness

In 17 of the 31 new areas where agencies may be able to achieve greater  efficiency or effectiveness, we found evidence of fragmentation, overlap,  or duplication among federal programs or activities. We identified  fragmentation in multiple programs we reviewed, including the following:
Combat Uniforms: We found that the Department of Defense’s  (DOD) fragmented approach to developing and acquiring combat  uniforms could be more efficient. Among the 14 areas of opportunity to reduce costs or enhance revenue  identified in our 2013 annual report are the following examples of  opportunities for executive branch agencies or Congress to take action to  address the issues we reported:
Medicare Advantage Quality Bonus Payment Demonstration: We  report concerns about CMS’s Medicare Advantage Quality Bonus  Payment Demonstration, which is expected to cost $8.35 billion over  10 years, most of which will be paid to plans with average  performance. Although the demonstration is now in its second year, HHS still has an  opportunity to achieve significant cost savings—about $2 billion,  based on GAO’s analysis of CMS actuaries’ estimates—if it cancels  the demonstration for 2014. and other actions we have identified could help the federal  government increase revenue collections by billions of dollars. Through our three annual  reports, we have identified 162 areas in which there are opportunities to  reduce fragmentation, overlap, or duplication or to achieve cost savings  or enhance revenue. The Administration and Congress Have Made Some Progress in Addressing the Areas That We Previously Identified

In addition to the new actions identified for our 2013 annual report, we  have continued to monitor the progress that the executive branch  agencies and Congress have made in addressing the issues we identified  in our 2011 and 2012 annual reports. In these reports, we identified  approximately 300 actions that the executive branch and Congress could  take to achieve greater efficiency and effectiveness. As of March 6, 2013, the date we completed our  progress update audit work, about 12 percent of the 131 overall areas  were addressed; 66 percent were partially addressed; and 21 percent  were not addressed. Congress has also taken steps to address some of our suggested  actions. The  President’s Fiscal Year 2014 Budget submission proposes eliminating  direct payments to farmers. The President’s Fiscal Year 2014 Budget submission also states that  the President will again seek reorganization authority and use such  authority to consolidate the economic and business development  activities in the Departments of Commerce, Agriculture, Health and  Human Services, and the Treasury, as well as the Small Business  Administration, into a new department with a focused mission to foster  economic growth and spur job creation. Addressing these issues will require sustained attention by the executive  branch agencies and the Congress. However, realizing the intent of the GPRA Modernization Act for  assessing government performance and improvement and reducing  fragmentation, overlap, and duplication will require sustained oversight of  implementation. Additionally, we reported that a total of 31 federal departments and  agencies collect, maintain, and use geospatial information—information  linked to specific geographic locations that supports many government  functions, such as maintaining roads and responding to natural disasters. Better planning and implementation among federal agencies  could help reduce duplicative investments and provide the opportunity for  potential savings of millions of dollars. Similarly, in our three annual reports, we reported that better evaluation of  performance and results is needed for multiple federal programs and  activities to help inform decisions about how to address the  fragmentation, overlap, or duplication identified or achieve other financial  benefits. The regular collection and review of performance information, both within  and among federal agencies, could help executive branch agencies and  Congress determine whether some of the federal programs or initiatives  included in this series are making progress toward addressing the  identified issues and could determine the actions that need to be taken to  improve results. We have also suggested that Congress consider taking legislative action  to consolidate certain programs. In closing, as the fiscal pressures facing the nation continue, so too does  the need for executive branch agencies and Congress to improve the  efficiency and effectiveness of government programs and activities.
Why GAO Did This Study

As the fiscal pressures facing the nation continue, so too does the need for executive branch agencies and Congress to improve the efficiency and effectiveness of government programs and activities. Opportunities to take such action exist in areas where federal programs or activities are fragmented, overlapping, or duplicative.
To highlight these challenges and to inform government decision makers on actions that could be taken to address them, GAO is statutorily required to identify and report annually to Congress on federal programs, agencies, offices, and initiatives, both within departments and government-wide, that have duplicative goals or activities. GAO has also identified additional opportunities to achieve greater efficiency and effectiveness by means of cost savings or enhanced revenue collection.
This statement discusses the (1) new areas identified in GAO's 2013 annual report; (2) status of actions taken by the administration and Congress to address the 131 areas identified in GAO's 2011 and 2012 annual reports; (3) President's April Fiscal Year 2014 Budget submission and recently introduced legislation; and (4) strategies that can help address the issues GAO identified.

What GAO Found

GAO's 2013 annual report identifies 31 new areas where agencies may be able to achieve greater efficiency or effectiveness. Seventeen areas involve fragmentation, overlap, or duplication. For example, GAO reported that the Department of Defense could realize up to $82 million in cost savings and ensure equivalent levels of performance and protection by taking action to address its fragmented approach to developing and acquiring combat uniforms. Additionally, GAO reported that a total of 31 federal departments and agencies collect, maintain, and use geospatial information. Better planning and implementation could help reduce duplicative investments and save of millions of dollars.
The report also identifies 14 additional areas where opportunities exist to achieve cost savings or enhance revenue collections. For example, GAO suggested that Department of Health and Human Services cancel the Medicare Advantage Quality Bonus Payment Demonstration. GAO found most of the bonuses will be paid to plans with average performance and that the demonstration's design precludes a credible evaluation of its effectiveness. Canceling the demonstration for 2014 would save about $2 billion. GAO also noted opportunities to save billions more in areas such as expanding strategic sourcing, providing greater oversight for Medicaid supplemental payments, and reducing subsidies for crop insurance. Additionally, GAO pointed out opportunities for enhancing revenues by reducing the net tax gap of $385 billion, reviewing prices of radioactive isotopes sold by the government, and providing more equity in tobacco taxes for similar types of products.
The executive branch and Congress have made some progress in addressing the areas that GAO identified in its 2011 and 2012 annual reports. Specifically, GAO identified approximately 300 actions among 131 overall areas that the executive branch and Congress could take to reduce or eliminate fragmentation, overlap, or duplication or achieve other potential financial benefits. As of March 6, 2013, the date GAO completed its progress update audit work, about 12 percent of the areas were addressed, 66 percent were partially addressed, and 21 percent were not addressed. More recently, both the administration and Congress have taken additional steps, including proposals in the President's April Fiscal Year 2014 Budget submission.
Addressing fragmentation, overlap, and duplication will require continued attention by the executive branch agencies and targeted oversight by Congress. In many cases, executive branch agencies have the authority to address the actions that GAO identified. In other cases, such as those involving the elimination or consolidation of programs, Congress will need to take legislative action. Moreover, sustained congressional oversight will be needed in concert with the Administration's efforts to address the identified actions by improving planning, measuring performance, and increasing collaboration. Effective implementation of the GPRA Modernization Act of 2010 also could help the executive branch and Congress as they work to address these issues over time.