CMS officials warn of large, multinational Medicaid fraud and say agency is considering payment deferrals pending audits
January 30, 2026 | Department of Health and Human Services (HHS), Executive, Federal
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During a question-and-answer session, reporters pressed CMS officials on program‑integrity enforcement and the scale of alleged Medicaid fraud.
A reporter asked whether CMS would suspend or withhold federal Medicaid payments from states that do not produce program‑integrity plans. Administrator Oz replied that the agency is "looking at deferring payments based on audits" for February 2025 while it gathers more data. Oz said CMS is coordinating with Treasury, the Department of Justice, the Office of Inspector General and the FBI to try to ‘‘preemptively stop the money from going out.’’
Oz described examples investigators have found: in one Florida example, durable medical equipment (DME) providers were ‘‘bust outs’’ at the same address that billed high amounts but had no actual staff or shipments; in California he said hospice providers had proliferated in some areas and cited patient testimonials alleging harm. He also said law‑enforcement partners reported providers or actors fleeing overseas and that some criminal networks appear to have multinational elements.
Asked about the scale, Oz said, ‘‘We estimate there could be up to a $100,000,000,000 of this type of fraud,’’ and said CMS intends to try to claw back improper payments. Dan Brillman and Amy Gleason added that better automated data checks and vendor integrations can reduce beneficiary burden and help states identify improper payments earlier.
Why it matters: CMS framed program integrity as both a financial and care‑quality concern, saying stopping improper payments preserves resources and protects vulnerable beneficiaries. Officials characterized the problem as systemic across multiple states rather than confined to a single jurisdiction.
What’s next: CMS said it will conduct audits and coordinate with federal law enforcement; Administrator Oz indicated the agency is considering payment deferrals for noncompliant states and will continue to develop program‑integrity rules and data sources.
The publicly released transcript does not specify the date of this briefing.
A reporter asked whether CMS would suspend or withhold federal Medicaid payments from states that do not produce program‑integrity plans. Administrator Oz replied that the agency is "looking at deferring payments based on audits" for February 2025 while it gathers more data. Oz said CMS is coordinating with Treasury, the Department of Justice, the Office of Inspector General and the FBI to try to ‘‘preemptively stop the money from going out.’’
Oz described examples investigators have found: in one Florida example, durable medical equipment (DME) providers were ‘‘bust outs’’ at the same address that billed high amounts but had no actual staff or shipments; in California he said hospice providers had proliferated in some areas and cited patient testimonials alleging harm. He also said law‑enforcement partners reported providers or actors fleeing overseas and that some criminal networks appear to have multinational elements.
Asked about the scale, Oz said, ‘‘We estimate there could be up to a $100,000,000,000 of this type of fraud,’’ and said CMS intends to try to claw back improper payments. Dan Brillman and Amy Gleason added that better automated data checks and vendor integrations can reduce beneficiary burden and help states identify improper payments earlier.
Why it matters: CMS framed program integrity as both a financial and care‑quality concern, saying stopping improper payments preserves resources and protects vulnerable beneficiaries. Officials characterized the problem as systemic across multiple states rather than confined to a single jurisdiction.
What’s next: CMS said it will conduct audits and coordinate with federal law enforcement; Administrator Oz indicated the agency is considering payment deferrals for noncompliant states and will continue to develop program‑integrity rules and data sources.
The publicly released transcript does not specify the date of this briefing.
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