The House Energy and Commerce Committee is demanding records from 11 states as part of a widening investigation into potential Medicaid fraud. It’s just the latest sign that Washington is beginning to recognize the scale of abuse inside one of the nation’s largest entitlement programs.
The Centers for Medicare and Medicaid Services is also taking a more aggressive approach toward suspected fraud, including withholding or deferring federal Medicaid payments to states while investigations are ongoing. Likewise, President Donald Trump recently named Vice President JD Vance as the administration’s anti-fraud czar.
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The scrutiny is long overdue.
For years, Medicaid’s defenders have treated fraud and improper payments as an unfortunate but manageable byproduct of a massive government program. But the sheer number of recent scandals suggests a more systemic problem: Medicaid has become a magnet for organized fraud in many parts of the country.
In New York, investigators recently uncovered widespread fraud in the state’s Medicaid transportation system, with some drivers allegedly scamming taxpayers out of as much as $196 million through fake trips, improper documents, and other billing abuses.
In Pennsylvania, a business owner was recently sentenced for perpetrating Medicaid fraud and money laundering schemes that prosecutors said stole millions from taxpayer-funded healthcare programs, including Medicaid. And in Wisconsin, the owner of a Milwaukee prenatal care coordination company was sentenced to five years in prison for fraudulently billing Medicaid for more than $2.6 million in services that were never provided.
The Paragon Health Institute’s Medicaid fraud dashboard catalogs hundreds of cases like these nationwide. Together, they reveal a healthcare program increasingly vulnerable to sophisticated scams, shell providers, and criminal exploitation.
The scale of the problem is staggering. Last year alone, Medicaid Fraud Control Units recovered almost $2 billion through investigations and prosecutions. Yet those recoveries likely represent only a fraction of the money improperly flowing through the system each year.
The consequences of such widespread exploitation extend far beyond wasted taxpayer dollars. Fraudulent operators frequently target the very populations Medicaid was created to protect: low-income patients, disabled Americans, and vulnerable seniors.
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Every fraudulent claim paid by the government diverts resources away from patients who genuinely need care. And every new scandal further erodes public confidence in the safety net itself.
For years, policymakers — especially Democrats — focused far more on expanding Medicaid than on enforcing even basic accountability standards. From the look of things, that era may finally be coming to an end.
Sally C. Pipes is President, CEO, and Thomas W. Smith Fellow in Health Care Policy at the Pacific Research Institute. Her latest book is The World’s Medicine Chest: How America Achieved Pharmaceutical Supremacy—and How to Keep It (Encounter 2025). Follow her on X @sallypipes.