Improper payments are a long-standing, widespread, and significant problem in the fed. gov¿t. The Improper Payments Info. Act of 2002 (IPIA) has increased visibility over improper payments by requiring exec. branch agency heads to identify programs and activities susceptible to significant improper payments, estimate amounts improperly paid, and report on the amounts of improper payments and their actions to reduce them. This testimony addresses: (1) progress made in agencies' implementation of IPIA for FY 2008; and (2) several major challenges that continue to hinder full reporting of IPIA information. This testimony contains an overview of Medicare and Medicaid programs' implementation of IPIA. Charts and tables.