The federal government’s anti-fraud task force, led by Vice President J.D. Vance, announced a major escalation in its crackdown on healthcare fraud: withholding approximately $1.4 billion in payments to suspicious hospice and home health providers nationwide (including significant actions in California), suspending hundreds of providers in the Los Angeles area, and implementing a six-month nationwide moratorium on new Medicare enrollments for hospice and home health agencies.
Vice President J.D. Vance kicked off Wednesday’s press conference by describing the new anti-fraud strategies in very human terms.
“Fraud always has two fundamental victims,” Vance said. “The first victim is the American taxpayer. But it also has as its victims the people who are meant to benefit from these programs, who are not able to benefit — or maybe are benefiting less – because of what a disaster some of the fraud has wrought.”
The massive California crackdown – the largest healthcare fraud fight in CMS history, according to Trump’s team – comes after the administration said the state failed to properly police its own Medicaid program.
CMS Deputy Administrator Kim Brandt explained that her team uncovered $630 million in provider billing flagged as the top 5% of outliers nationally, another $500 million in suspicious home care spending growing at twice the national average, and $200 million in questionable payments.
California officials have now been asked to explain the discrepancies before any of those frozen funds are released.
Dr. Mehmet Oz, Administrator of the Centers for Medicare & Medicaid Services, noted the suspicious concentration of hospices in Los Angeles and questioned how so many could legitimately serve the population. Of the suspended providers — who had collectively billed large sums — the vast majority have not disputed the actions, with officials describing the response as “crickets.”
CMS is implementing a six-month nationwide moratorium on new Medicare enrollments for hospice and home health agencies. Existing providers may continue operating, but no new licenses or enrollments will be approved during this period while improved verification tools are developed.
Vance also highlighted glaring enforcement gaps: Hawaii, despite receiving billions in federal Medicaid funds, has recorded zero indictments or convictions in recent years. New York, with its roughly $100 billion program, produced just nine indictments in the same time period – while Indiana, with about one-third of New York’s population, had more than four times as many.
On Tuesday, letters were reportedly sent to all 50 state Medicaid programs demanding proof of prosecutions for serious fraud. States that can’t show meaningful enforcement risk losing their federal MFCU funding.
Vance was careful to note that the issue cuts across party lines, citing Ohio and Maryland as states that have cooperated constructively with the task force despite their different political leanings. “This does not have to be a red state or a blue state issue,” he said. “This is just basic good government.”
Brandt, whom Vance referred to as “probably the single official who has saved American taxpayers more money than any other official in the government,” highlighted the administration’s real-time claims monitoring system — known as the Medicare Fraud War Room — which has reportedly blocked over $2 billion in fraudulent payments since its launch in 2025. A parallel Medicaid effort is now flagging suspicious claims before payment.
The Medicaid War Room, launched in partnership with the Department of Justice, the FBI, and state fraud units, now also flags suspicious claims before they’re paid out.
Andrew Ferguson, executive director of the anti-fraud task force, said the stakes extend beyond dollars. “When the states just take this money and turn it into a jobs program for blue state lawyers, they are effectively participating in elder abuse,” he said, adding that MFCUs are legally required to investigate abuse and neglect in care settings.
Before opening the floor to questions, Vance left the room with a bottom-line number: fix the fraud, and the Medicare Trust Fund lives twice as long. No new taxes, no benefit cuts – just stopping the bleeding.
