Washington – The Centers for Medicare & Medicaid Services (CMS) announced that, under the Trump administration, it has blocked or reclaimed over $1.6 billion in potentially improper Medicare laboratory payments. The effort includes $732 million tied to 157 labs that were removed from the program for alleged fraud.
How the fraud was identified
CMS Administrator Dr. Mehmet Oz said laboratories that bill for tests never performed or unnecessary services drain the Medicare Trust Fund and divert resources from patients who truly need care. The agency is employing artificial‑intelligence tools to scan claims for patterns that fall outside normal billing behavior, allowing it to flag and halt suspicious payments before they are paid.
Key actions and recoveries
Among the actions taken, CMS held back $12 million in payments to a consulting‑company owner’s 14 labs and recovered an additional $7 million. Eleven of those labs have been removed from Medicare, while the remaining three remain under investigation.
Overall, more than $500 million in suspected fraudulent payments were stopped through 185 payment suspensions after reviewing roughly 600 labs. The agency also recovered $276 million in overpayments from 442 suspect labs and prevented another $127 million in potentially fraudulent claims after referring 85 cases to law‑enforcement.
Texas cases illustrate the crackdown
CMS highlighted two recent Texas labs as examples. One lab began billing in February, prompting CMS to deny $1.2 million in claims and later halt an additional $150,000 before removing the provider from Medicare. Another lab started heavy billing in May; CMS denied $1.9 million and captured $1.7 million, keeping the lab under review.
Broader impact
The administration’s anti‑fraud push extends beyond labs to medical equipment, hospice care, and skin‑treatment services. CMS reported that its fraud‑prevention efforts saved $42 billion in fiscal year 2025. So far in 2026, the agency has identified $1.8 billion in Medicare overpayments and recovered $378 million through post‑payment reviews. Since Jan. 1, CMS has frozen more than $371 million in payments involving 267 providers and suppliers.
“We won’t stop until we’ve restored program integrity and ensured fraudsters have nowhere left to hide,” Dr. Oz said, praising the administration’s commitment to protecting taxpayer‑funded health programs.
Original reporting: Fox News (HLL/CB) — read the source article.
