It's a range from a quarter to half, not a full half every year. It's 3 to 7% of annual spending obligations. Similar to someone charging you $100 for something that actually cost you $95. It's bad to be defrauded of that extra five bucks, I won't say that isn't. But taken into context of the overall spend the sticker shock becomes less severe.
Apparently the biggest sources are aid programs left to the states to administer. So the fraud is happening at the state level using federal government funds. If you drill in again, it tends to be companies and corporations at fault more than individual people. For profit hospitals and doctors defrauding Medicaid is a big source.
This means the solution isn't to cut the spending. But to pull these grants under federal administration instead of state administration and set up task forces charged with seeking out corporate and large scale offenders.
As usual it is the people with money and resources abusing the system and then trying to get poor people to take the punishment.
