⚡️ NIMITZ HEALTH NEWS FLASH ⚡️ 

“Protecting Patients and Taxpayers: Cracking Down on Medicare Fraud”

House Ways & Means Committee

April 21st, 2026 (recording linked here)

WITNESSES

• Dr. Lynn Ianni, Ph.D.: Medicare beneficiary and Medicare fraud victim

• Ms. Sheila Clark: President and CEO, California Hospice and Palliative Care Association

• Mr. David Klebonis: Chief Operating Officer, Palm Beach ACO

• Mr. Christopher Deery: Director of Corporate and Financial Investigations, Independence Blue Cross

• Ms. Kristi Martin: Principal, Highway 136 Consulting

QUICK SUMMARY

• Medicare fraud—particularly in hospice, home health, and durable medical equipment—was described as widespread, costly, and increasingly driven by organized and adaptive schemes.

• Witnesses and members emphasized systemic weaknesses such as the “pay-and-chase” model, inadequate provider enrollment screening, and fragmented data systems that allow fraud to occur before detection.

• Fraud was shown to directly harm beneficiaries, including wrongful hospice enrollment, denied care, and misuse of personal and provider identities.

• Data analytics, AI, and cross-sector collaboration were highlighted as critical tools for earlier detection and prevention, though limitations in data sharing and system integration remain.

• There was broad agreement on the need for stronger front-end controls, better beneficiary protections, and more coordinated enforcement to prevent fraud rather than recover funds after the fact.

🐘 Republicans

• Emphasized the scale of Medicare fraud and framed it as a major driver of wasteful spending requiring stronger enforcement and systemic reform.

• Focused on prevention over recovery, highlighting failures of the “pay-and-chase” model and calling for tighter provider screening and use of advanced analytics.

• Raised concerns about accountability, arguing that weak oversight and insufficient penalties had allowed fraud to proliferate.

🫏 Democrats

• Emphasized protecting beneficiaries from harm, particularly wrongful enrollment and loss of access to care due to fraud.

• Highlighted the need to avoid policies that restrict legitimate care or unfairly burden providers while strengthening oversight.

• Focused on transparency, equity, and targeted enforcement, stressing that reforms should address real perpetrators without politicizing the issue.

MEMBER OPENING STATEMENTS

• Chair Smith (R-MO) stated that Medicare had been created to provide affordable healthcare for seniors and emphasized that it was an earned benefit funded by lifelong contributions. He argued that widespread fraud, including schemes involving fake facilities and fraudulent billing, had severely threatened the integrity of the program and cost taxpayers billions of dollars annually. He claimed that certain states had become centers of fraud due to weak oversight and policy decisions, allowing criminal organizations and individuals to exploit the system. He concluded by asserting that recent enforcement efforts had begun to recover funds and hold perpetrators accountable, and that the hearing was intended to restore trust and protect Medicare for beneficiaries.

• Ranking Member Doggett (D-TX) stated that addressing healthcare fraud was long overdue, but criticized the committee and the Trump administration for failing to take effective action. He argued that enforcement had been weak, citing concerns about reinstated brokers accused of fraud and a lack of accountability from federal officials. He contended that much of the fraud had been committed by agents and brokers rather than beneficiaries, and that policy responses had wrongly harmed access to healthcare for legitimate users. He concluded by proposing stronger oversight measures and legislative solutions, emphasizing the need to target actual perpetrators while protecting consumers and taxpayer resources.

WITNESS OPENING STATEMENTS

• Dr. Ianni stated that she appeared both as a clinician and as a Medicare beneficiary who had been a victim of fraud. She described how she had been incorrectly enrolled in hospice care, which caused her legitimate medical claims to be denied and left her unable to access care for months. She explained that repeated attempts to resolve the issue through Medicare had failed, forcing her to investigate the fraud herself before eventually obtaining a correction with outside help. She concluded that her experience reflected a broader systemic failure and urged reforms to improve fraud detection, accountability, and accessibility for beneficiaries.

• Ms. Clark stated that hospice and home health fraud represented serious failures in protecting beneficiaries, not just billing issues. She explained that fraudulent schemes often involved enrolling patients without consent, billing for nonexistent services, and cycling patients through networks of sham providers. She argued that regulatory and oversight failures had allowed rapid and abnormal growth in fraudulent providers, particularly in California, and that fraud had shifted across programs when restrictions were imposed. She concluded by recommending stronger enforcement, better data integrity, and mechanisms to protect beneficiaries from being trapped in fraudulent enrollments.

• Mr. Klebonis stated that while Medicare programs had improved care coordination, gaps in fraud prevention had undermined trust and financial accountability. He described large-scale fraudulent billing cases, including millions of dollars tied to a single beneficiary and abuse in durable medical equipment claims. He explained that legitimate providers were often penalized for fraudulent activity beyond their control, even when they reported it. He concluded by calling for stronger safeguards to prevent fraudulent payments and to protect accountable care organizations from being financially harmed by fraud.

• Mr. Deery stated that healthcare fraud diverted resources, increased costs, and exposed vulnerable patients to inappropriate care. He explained that his organization used data analytics, investigations, and partnerships with law enforcement to detect and prevent fraud, but still encountered complex, coordinated criminal networks. He noted that the current “pay-and-chase” model in Medicare allowed fraudulent payments to occur before recovery efforts could begin. He concluded by recommending proactive monitoring, improved data sharing, and stronger oversight systems to better prevent fraud before payments were made.

• Ms. Martin stated that Medicare’s size and importance required strong protections against fraud, waste, and abuse. She highlighted reforms that had reduced prescription drug costs but argued that additional issues remained, particularly involving pharmacy benefit managers and lack of transparency in drug pricing initiatives. She criticized certain recent policies for lacking evidence of savings and for potentially misleading consumers. She concluded by urging greater transparency, stronger oversight, and expansion of proven policies to reduce costs and protect beneficiaries and taxpayers.

QUESTION AND ANSWER SUMMARY

• Chair Smith (R-MO) emphasized the scale of Medicare fraud and its harm to both taxpayers and beneficiaries, asking what policymakers should do. Dr. Ianni urged bipartisan cooperation and responsibility, emphasizing solutions over blame.

  He asked about prior warnings, and Ms. Clark stated that fraud had been reported to California and federal officials for years without sufficient response.

  Chair Smith also asked about fraud detection tools, and Mr. Deery explained that insurers used data analytics and machine learning but still required human oversight and beneficiary engagement, and asked Mr. Klebonis about provider burden, who noted that resources spent fighting fraud diverted care from patients.

• Ranking Member Doggett (D-TX) argued that fraud enforcement had been insufficient and politicized, citing inspector general work and criticizing administrative decisions that he said weakened oversight. He questioned witnesses on policy tools, including deactivating provider identifiers for convicted fraudsters, and received agreement from witnesses that stronger accountability measures were needed.

  He also asked whether fraudsters should be held accountable and whether CMS needed adequate staffing, with witnesses broadly agreeing that enforcement resources and authority should be strengthened.

• Rep. Buchanan (R-FL) focused on the scale of healthcare spending and asked how to better control fraud systemwide. Ms. Clark emphasized preventing fraudulent providers from entering the system through stronger licensing and certification controls.

  Rep. Buchanan also asked about successful fraud detection, and Mr. Klebonis attributed effectiveness largely to frontline physicians identifying suspicious activity, while Mr. Deery highlighted the importance of cross-sector collaboration and data sharing among insurers and government entities.

• Rep. Thompson (D-CA) stressed that fraud was a nationwide issue and should be addressed in a bipartisan manner, criticizing political framing and lack of enforcement transparency. He asked whether perpetrators in Dr. Ianni’s case had been caught, and Dr. Ianni explained that fraudulent activity persisted even after she identified misuse of a provider’s credentials. Rep. Thompson argued for stronger enforcement, accountability, and prosecution of fraudsters.

• Rep. Smith (R-NE) emphasized the need to prevent fraud rather than recover funds after payment and asked about duplicate enrollments and system vulnerabilities. He questioned how fraud impacts ACOs, and Mr. Klebonis explained that ACOs bear financial risk and actively engage physicians to detect fraud.

  Rep. Smith also asked about program design, and Mr. Deery highlighted protecting provider identifiers and beneficiary data, and noted that while technology had improved detection, fraudsters often adapted quickly, requiring continued innovation and human oversight.

• Rep. Larson (D-CT) emphasized the need for transparency and oversight, referencing legislative tools and concerns about data access and accountability. He asked witnesses about proposals like the Hospice Care Act and broader oversight mechanisms, with Ms. Clark supporting further discussion of reforms.

  He also raised concerns about data security and accountability for entities accessing sensitive information, with witnesses emphasizing transparency, safeguards, and responsible information sharing.

• Rep. Kelly (R-PA) framed fraud as a systemic failure across administrations and criticized the lack of accountability compared to the private sector. He asked what should be done, and Dr. Ianni recommended stronger penalties, improved oversight of provider identifiers, and better system coordination to track claims and fraud status.

  He concluded that all stakeholders shared responsibility and emphasized the financial burden on taxpayers.

• Rep. Davis (D-IL) focused on the “pay-and-chase” model and asked about prevention strategies. Ms. Martin explained efforts to shift toward a “stop-and-verify” model using data analytics to detect fraud before payments are made.

  He also asked about education, and Ms. Martin noted that CMS had pursued beneficiary and provider education initiatives to help prevent fraud and protect personal information.

• Rep. Schweikert (R-AZ) expressed frustration with longstanding inaction despite extensive data on fraud. He argued that systemic reform should rely more heavily on data science and predictive analytics rather than traditional enforcement, emphasizing that preventing payments before they occur was essential.

  He highlighted the scale of Medicare spending and warned that failure to modernize fraud detection would worsen financial sustainability challenges.

• Rep. Linda Sánchez (D-CA) emphasized that fraud occurs nationwide and highlighted legislative solutions, particularly her Hospice Care Act. She asked whether beneficiary notification of hospice enrollment would have helped, and Dr. Ianni agreed it would have prevented harm.

  She also confirmed with Ms. Clark that the legislation was not politically divisive and argued for bipartisan action to implement reforms rather than politicize fraud.

• Rep. LaHood (R-IL) focused on value-based care and ACOs, asking whether risk-based models incentivized fraud detection. Mr. Klebonis confirmed that ACOs aggressively combat fraud due to financial risk and described significant operational impacts from fraud losses.

  He also asked how CMS could better leverage ACOs, with Mr. Klebonis recommending prioritizing their fraud reports and expanding prepayment authority, and noted that incentives help sustain provider participation in value-based care.

• Rep. Neal (D-MA) emphasized bipartisan opposition to fraud but cautioned against using “fraud” rhetoric to justify policy changes without evidence. He criticized the use of pardons for convicted fraudsters and questioned prescription drug policy claims, and Ms. Martin stated that recent initiatives had not demonstrably lowered drug prices.

  He concluded by stressing the importance of enforcement through existing institutions and maintaining focus on protecting Medicare’s integrity.

• Rep. Estes (R-KS) asked about how fraudulent providers were able to enter Medicare and what safeguards could prevent this. Ms. Clark explained that weak enrollment screening and rapid provider approvals had enabled fraudulent entities to gain access to the system. Mr. Deery added that stronger pre-enrollment verification and continuous monitoring would help prevent bad actors from billing Medicare. The discussion emphasized shifting from reactive enforcement to preventing fraudulent entry into the system.

• Rep. Sewell (D-AL) framed fraud as a bipartisan issue but criticized what she described as a double standard in enforcement, particularly regarding presidential pardons of individuals convicted of healthcare fraud. She asked the witnesses whether they opposed such pardons, and several responded that they lacked sufficient knowledge of specific cases to comment. Rep. Sewell argued that pardoning convicted fraudsters undermined accountability and public trust, emphasizing that fraud enforcement should be consistent and not used to justify reductions in healthcare access.

• Rep. Arrington (R-TX) shifted the discussion to broader issues of fairness and eligibility, questioning whether individuals should only receive benefits if legally entitled. Dr. Ianni declined to engage on eligibility and immigration-related questions, leading Rep. Arrington to express frustration about a lack of consensus on baseline principles.

  He also raised concerns about fraud in pandemic-era programs and argued that stricter eligibility enforcement had generated savings. The exchange reflected a focus on program integrity, eligibility enforcement, and broader concerns about misuse of federal benefits.

• Rep. Smucker (R-PA) emphasized that Medicare fraud involved organized criminal activity rather than isolated misuse, citing examples such as sham providers, fake addresses, and large-scale fraudulent billing schemes. He contrasted these systemic fraud issues with debates over individual eligibility, arguing that policy efforts should focus on preventing organized exploitation of federal programs. He also referenced legislative efforts to reduce improper payments and improve state accountability, but noted disagreement across parties on those approaches.

• Rep. Chu (D-CA) emphasized the real-world harm of fraud on patients, citing cases of wrongful hospice enrollment and nursing home failures. She asked about the impact of pardoning fraudsters, and Ms. Martin responded that the lack of consequences undermined enforcement credibility and public trust.

  Rep. Chu also raised concerns about political interference in FDA decision-making, asking whether industry influence affected drug approvals; Ms. Martin expressed concern about reduced agency independence and potential favoritism.

• Rep. Kustoff (R-TN) focused on waste in prescription drug programs, citing evidence of excessive refilling of medications. Mr. Deery confirmed that overutilization was a real issue, noting challenges in balancing convenience with appropriate use and emphasizing the importance of member engagement and monitoring prescribing patterns. He also stated that such issues occur across insurance types and are not limited to Medicare, highlighting inefficiencies and misuse within pharmacy benefit structures.

• Rep. Fitzpatrick (R-PA) focused on fraud in addiction treatment and opioid-related services, asking about ongoing risks and prevention strategies. Mr. Deery stated that while progress had been made, fraud in substance use disorder treatment remained a concern and required stronger program integrity measures, particularly around eligibility and enrollment.

  He also emphasized the role of both technology and trained investigators in identifying fraud.

• Rep. Moore (D-WI) focused on balancing fraud prevention with maintaining access to care, particularly in hospice services. Ms. Clark discussed using indicators such as death rates and treatment patterns to identify fraud, while Ms. Martin addressed concerns about drug pricing claims, noting that reported savings were difficult to verify and often overstated.

• Rep. Steube (R-FL) contrasted fraud issues in California with stronger oversight systems in Florida, particularly certificate-of-need (CON) laws. Ms. Clark agreed that such frameworks could be effective and emphasized the need for stronger entry requirements, oversight, and enforcement.

  Ms. Clark also described how fraud networks recruit beneficiaries through brokers and operate across regions, sometimes using nonexistent facilities.

• Rep. Tenney (R-NY) focused on the broader market impact of fraud, including its role in driving down access to care and distorting payment systems. Ms. Clark explained that fraudulent billing contaminates data used to set reimbursement rates, leading to systemic distortions that harm legitimate providers.

  Rep. Tenney also highlighted large-scale fraud cases and expressed concern about international involvement in fraud schemes.

• Rep. Beyer (D-VA) raised concerns about reduced enforcement capacity, citing staffing losses at the Department of Justice and their impact on fraud prosecutions.

  Ms. Martin affirmed the importance of independent oversight bodies and supported broader data sharing, including all-payer claims databases, to improve fraud detection.

  Rep. Beyer also asked about hospice enrollment incentives, though Dr. Ianni stated she could not speak to those mechanisms.

• Rep. Fischbach (R-MN) focused on legislative efforts to combat fraud, including whistleblower protections and restrictions on misuse of federal benefits. She asked about the needs of fraud victims, and Dr. Ianni emphasized the importance of communication, accountability, and support during resolution processes.

  She also highlighted the lack of acknowledgment and assistance she received after being defrauded. The exchange underscored the human impact of fraud and the need for victim-centered responses.

• Rep. Feenstra (R-IA) emphasized taxpayer impacts and asked about incentivizing legitimate providers, including through “gold card” programs. Mr. Klebonis supported such incentives alongside stronger penalties and barriers for fraudulent actors.

  He also asked about federal fraud task forces, and Ms. Clark noted early positive results, including faster beneficiary notification systems.

• Rep. Evans (D-PA) raised concerns about the broader healthcare system, including funding cuts and their potential impact on fraud and access to care. Ms. Martin stated that reduced funding and coverage disruptions could worsen health outcomes and increase long-term system costs.

• Rep. Miller (R-WV) emphasized that hospice fraud harmed both taxpayers and patients, particularly when non-terminal individuals were improperly enrolled and denied necessary treatments. She asked whether recent enforcement actions accounted for patient harm, and Ms. Clark confirmed that some fraudulent providers had been suspended and described a case where a patient faced financial liability after improper hospice enrollment.

  Rep. Miller then asked how Congress and CMS could better protect beneficiaries, and Ms. Clark stressed the need for stronger beneficiary education, improved awareness of fraud reporting resources, and better coordination between federal and state oversight systems to remove fraudulent providers more effectively.

• Rep. Murphy (R-NC) framed fraud broadly across the healthcare system, criticizing past administrative decisions that reduced oversight and contributed to improper payments. He highlighted systemic failures in detecting large-scale fraud schemes and emphasized the importance of using AI to improve detection.

  He pressed Mr. Deery on whether upcoding in Medicare Advantage constituted fraud; Mr. Deery declined to make a legal determination, emphasizing that fraud determinations are made in court.

  Rep. Murphy argued that knowingly inflating diagnoses to increase payments should be considered fraud and criticized insurers engaging in such practices, calling for stronger enforcement and reforms at CMS.

• Rep. Schneider (D-IL) stressed bipartisan agreement on combating fraud while also defending Medicare as a critical earned benefit. He contextualized fraud within the overall scale of U.S. healthcare spending, noting that while Medicare fraud was significant, it represented a smaller percentage compared to other sectors. He highlighted high-profile fraud cases and criticized presidential pardons of convicted fraudsters, arguing they undermined accountability and recovery of funds. He outlined three priorities: establishing a zero-tolerance culture, improving prevention and enforcement systems, and ensuring accountable leadership. He also pointed to policy solutions such as accountable care organizations to improve system integrity.

• Rep. Hern (R-OK) focused on the impact of fraud on legitimate providers and patients, particularly in home health and hospice care. He asked how fraud affected honest providers financially, and Ms. Clark explained that fraudulent hospice enrollments could exhaust patient benefit caps, leaving legitimate providers unpaid or financially liable for necessary care.

  Rep. Hern also highlighted successful state-level enforcement efforts and asked how federal and state coordination could be improved. Ms. Clark emphasized the importance of data sharing, interagency collaboration, and coordinated task forces to dismantle fraud networks more effectively.

• Rep. Malliotakis (R-NY) underscored the scale of Medicare fraud and its direct harm to seniors, citing major fraud cases in New York and nationally. She asked Ms. Clark whether Medicare sufficiently educated beneficiaries about identifying and reporting fraud; Ms. Clark responded that awareness remained low and called for expanded outreach and funding for programs like Senior Medicare Patrol.

  Rep. Malliotakis also asked about emerging fraud schemes, and Ms. Clark described inducement-based scams and shared a case where fraudulent hospice enrollment delayed necessary care, ultimately contributing to a patient’s death.

• Rep. Panetta (D-CA) emphasized that healthcare fraud was bipartisan and highlighted prior legislative efforts to strengthen hospice oversight, including a special focus program that had since been suspended. He asked how such programs could be improved, and Ms. Clark emphasized the need for stronger entry controls and regulatory guardrails rather than commenting on specific program methodologies.

  He also asked about collaboration with the current administration, and Ms. Clark confirmed ongoing engagement on improving oversight, particularly at the provider entry level.

• Rep. Carey (R-OH) focused on CMS fraud detection tools, including a new AI-driven fraud detection center. He asked about the effectiveness of a proposed hospice spending index, and Ms. Clark expressed concerns about its design and reliability.

  He then asked about collaboration with CMS and the use of AI; Mr. Deery described identifying billing anomalies such as spikes, ownership changes, and unusual provider activity, and emphasized that AI can scale detection while human investigators validate findings.

  He also highlighted improved data sharing, including access to suspended provider lists.

• Rep. Moore (R-UT) focused on the use of AI to prevent fraud before payments are made. He asked how AI could improve detection, and Ms. Clark described using claims data to identify inconsistencies—such as patients labeled as terminally ill without supporting medical history—and stopping fraudulent enrollments at the front end. He emphasized the broader applicability of such tools across healthcare programs.

• Rep. Horsford (D-NV) emphasized balancing fraud prevention with maintaining access to care, noting that overly bureaucratic systems could harm patients. He asked Ms. Martin about safeguards to prevent delays in care, and she highlighted legislative approaches that combine fraud controls with access protections, such as targeted moratoriums with exceptions.

  He also raised the need for better victim support, and Dr. Ianni confirmed that assistance programs like Senior Medicare Patrol were critical but underutilized.

• Rep. Van Duyne (R-TX) asked for key policy changes to help fraud victims recover quickly, and Ms. Clark emphasized education, rapid disenrollment processes, and restoring beneficiaries’ records and benefits after fraud occurs. She also discussed the need for stronger accountability mechanisms and consequences for fraudsters.

  Rep. Van Duyne further questioned gaps in prior administrative actions and proposed using specific data indicators (e.g., ownership changes, abnormal discharge rates) to trigger oversight, which Ms. Clark generally supported when applied appropriately.

• Rep. Moran (R-TX) focused on durable medical equipment (DME) fraud, citing large-scale schemes involving unnecessary braces and telemarketing. He asked about patient impacts, and Ms. Clark described how beneficiaries often unknowingly received equipment and faced complex, time-consuming processes to resolve fraud. Mr. Klebonis emphasized the need to empower claims processors to stop fraudulent payments upfront rather than simply paying and recovering later.

  Rep. Moran also asked how legitimate providers could help combat fraud, and Ms. Clark stressed their role in identifying and reporting suspicious activity while maintaining transparency with patients.

• Rep. Suozzi (D-NY) emphasized that fraud was a shared bipartisan issue and confirmed consensus among witnesses. He explored why certain sectors, such as hospice, were particularly vulnerable, and Dr. Ianni attributed this to insufficient oversight and ease of exploitation.

  He discussed legislative solutions, including hospice reform proposals, and witnesses generally supported strengthening oversight and accountability measures. He concluded by urging bipartisan collaboration to address complex fraud issues effectively.

• Rep. Yakym (R-IN) highlighted the scale of Medicare fraud and asked why California was a hotspot; Ms. Clark pointed to weak entry controls and concentrated fraudulent activity, particularly in Los Angeles County, which distorted payment systems.

  Rep. Yakym also asked about fraud prevention tools in Medicare Advantage, and Mr. Deery described real-time analytics, payment monitoring, and rapid response systems. He noted that while CMS was improving, better data sharing and fewer regulatory barriers would enhance fraud detection.

• Rep. Bean (R-FL) emphasized systemic weaknesses in Medicare’s “pay-and-chase” model and advocated for stronger upfront verification of providers. He proposed increased transparency for beneficiaries, such as providing regular statements of claims, and asked witnesses whether such measures would help; Dr. Ianni agreed.

  He also highlighted legislative efforts to verify provider credentials and pressed on private-sector practices, which rely on pre-payment review and investigation to prevent fraud.