Welfare fraud is on the rise and is rampant in Pennsylvania.

Nationally, the U.S. Government Accountability Office reported $186 billion in improper payments in 2025 — a $24 billion increase from the previous year. And hard-working taxpayers fund all these improper payments.

To be clear, not all improper payments are necessarily fraudulent, but they do reveal a growing problem in the Keystone State. Between 2021 and 2025, Pennsylvania’s number of welfare fraud cases was nearly triple the national rate, according to analysis by the Foundation for Government Accountability. FGA described the commonwealth’s average fraud investigations as “one of the largest case volumes in the country.”

Pennsylvania is now one of the leading states in prosecuting welfare fraud. The commonwealth leads the country in fraud convictions and ranks third in charges filed against those defrauding Pennsylvania taxpayers and welfare recipients.

Even Gov. Josh Shapiro once admitted that Pennsylvania has a problem with fraud. Back when he was the attorney general, he estimated that Medicaid fraud cost Pennsylvanians $3 billion per year. (Ironically, Shapiro, now as governor, wants to add another $1.7 billion in the state budget for the Pennsylvania Department of Human Services, the agency responsible for managing welfare programs.)

And now, under a new federal law, Pennsylvania taxpayers may have to pay directly for the state’s failure to police its own programs. States with a payment error rate above 6% for the Supplemental Nutrition Assistance Program, also known as food stamps, must absorb a share of the costs.

Pennsylvania, with its 10% payment error rate, is on track to pay for its negligence. This leaves taxpayers on the hook for the costs, with estimates ranging from $450 million to $660 million.

This fraud poses an existential threat both to those who truly need welfare services and to the taxpayers footing the bill. Clearly, state lawmakers have their work cut out for them.

There is some good news because progress was made during last year’s budget negotiations. Republican lawmakers in the General Assembly secured critical reforms, including monthly cross-checks of death records and quarterly cross-checks of wage data for both Medicaid and SNAP. Such reforms ensure benefits aren’t flowing to deceased individuals or people who no longer qualify due to increased income.

And while these are a good start, we still have far to go to achieve increased accountability.

Consider the Broad-Based Categorical Eligibility loophole. This policy allows states to bypass federal asset and income limits for SNAP, allowing for more questionable claims to sneak through. For example, Rob Undersander, a Minnesota millionaire, received about $6,000 in SNAP benefits — all thanks to this loophole.

“I [collected food stamps] primarily to make a point and raise public awareness to ensure that the truly needy receive the benefits that are available, and that’s not happening right now,” Undersander said.

More than 40 states, including Pennsylvania, have exploited this loophole. Researchers estimate it has placed at least 5.9 million otherwise-ineligible people on the food stamp rolls. The GAO also associates increases in the error payment rate with the loophole.

Closing this loophole is not a radical idea. In fact, it is a commonsense plan adopted by several states. Idaho, South Dakota, Wyoming and Nebraska have either closed the loophole or never adopted it in the first place. All four states have error rates below the federal benchmark.

Pennsylvania must also get serious about implementing work requirements for childless, working-age recipients, better known as “able-bodied adults without dependents,” or ABAWDs. The federal government requires ABAWDs to work at least 80 hours per month. That’s less than 20 hours a week. They can also participate in job training or volunteer as an alternative. This isn’t a high bar.

Pennsylvania has until January to comply, but why wait? Nebraska has already taken the prudent route and implemented work requirements early. Doing so allows states to spot problems with their systems and to avoid disenrolling individuals for paperwork errors.

Plus, incentivizing recipients to work would be a boon for the local economy. A Commonwealth Foundation study estimated that between 80,000 and 100,000 able-bodied adults would rejoin the workforce, earning between $175 million and $210 million in higher wages. Since the additional federal work requirements, Pennsylvania has seen a dip in SNAP enrollment, suggesting folks are moving away from government dependency.

None of these reforms dismantles the safety net. Quite the opposite, actually.

There are many who cannot work, and these reforms protect the integrity and original intent of these programs. Every fraudulent dollar paid out is a dollar stripped from an elderly Pennsylvanian in need of care, a disabled child waiting for services, or a pregnant mother stretching a tight budget.

The governor’s unwillingness to address welfare fraud puts us at odds with the federal government, costing us in the long run. The good people of our great commonwealth cannot afford Harrisburg’s inaction.

Megan Martin is the chief operating officer and general counsel for the Commonwealth Foundation.