"We’re trying to save the Medicaid Program from dysfunctional State Bureaucrats," says Vance
WASHINGTON, D.C. (Texas Insider Report) — "We see a lot of fraud in the Home Healthcare and the Hospice System,” said Vice President JD Vance at a Wednesday news conference. "We're announcing that the federal government is deferring $1.3 billion in Medicaid reimbursements from the State of California – and the simple reason is because California has not taken fraud very seriously," Vance said.
According to CMS, recent enforcement efforts tied to the anti-fraud task force have already led to suspended payments for 773 hospice providers and 23 home health agencies in the Los Angeles area alone.The action, announced in coordination with Vance's anti-fraud task force, will temporarily block new providers in those sectors from enrolling in Medicare while federal officials intensify investigations into suspected fraudulent activity.
Vance also said the Trump administration is sending letters that will require 50 Medicaid programs to show that they are "effectively and aggressively" prosecuting Medicaid fraud in their states.
He said if they fail to prosecute Medicaid fraud, the administration will "turn off" the money that goes to the anti-fraud units.
"I’m sure there are going to be some politicians who say what we're doing here is harming the Medicaid program. We’re trying to save the Medicaid program from dysfunctional state bureaucrats," Vance said.CMS Administrator Dr. Mehmet Oz, who along with Federal Trade Commission Chair Andrew Ferguson and Kim Brandt, a senior official with CMS, joined Vance at the news briefing.
"If you allow billions more dollars to go out the door, not to healthcare services for low-income families, but to fraudsters, you are eventually going to destroy the Medicaid program."
Oz said the move is aimed at protecting both Medicare patients and taxpayer dollars.
"In February, we had the largest anti-fraud announcement from CMS," Oz said.
Today's effort is larger – it's much larger – and there's a reason for that," Oz added.The newly announced moratorium also applies to certain ownership changes, which officials said are often used by fraudulent operators to hide control of businesses and avoid detection.
"Half of the fraud, we believe, in the federal government, could be coming out of healthcare services."
The freeze will not affect existing providers currently serving Medicare patients.
The announcement marks one of the most aggressive anti-fraud actions taken by CMS in recent years and follows similar restrictions earlier this year targeting companies involved in durable medical equipment, prosthetics, orthotics, and supplies.
Officials said additional measures include revoking or deactivating providers accused of improper billing practices, conducting nationwide site inspections, increasing background checks for high-risk agencies and launching a public hospice scoring system designed to flag concerning patterns in quality, compliance and billing.
CMS has also expanded review programs in several states – including Florida, Illinois, Ohio, North Carolina, Oklahoma and Texas – to identify improper claims before payments are issued.
CMS has also expanded review programs in several states – including Florida, Illinois, Ohio, North Carolina, Oklahoma and Texas – to identify improper claims before payments are issued.
The Trump Administration said the broader initiative is designed to stop fraud before it starts while strengthening oversight across Medicare-funded healthcare programs.
