Trump Admin. Uncovers $3.4 Billion in Fraudulent Medical Supplies Billing

The Centers for Medicare & Medicaid Services (CMS) announced this week that the agency has discovered $3.4 billion in suspected fraud from 11 medical supply companies spanning 2025 and 2026. These companies have now been barred from receiving future Medicare Advantage Part C and Part D payments.

In a press release, CMS explained that these companies are “durable medical equipment, prosthetics, orthotics, and supplies” (DMEPOS) producers that “had submitted no claims prior to 2025,” “used improper billing practices for their claims,” “had billed for medical equipment to beneficiaries already deceased,” and “supplied equipment to beneficiaries who never requested or received it.”

In some cases, the companies apparently simply made up claims and then billed the government for them.

The investigation that uncovered the scandal was part of the White House’s Anti-Fraud Task Force headed up by Vice President JD Vance. CMS Administrator Dr. Mehmet Oz specifically called out fraudsters who used deceased individuals to dishonestly take money from the government.

“Fraudsters who take advantage of the recently deceased to line their pockets represent a level of indecency that we will not stand for,” Oz said. “Brazen scams like these have plagued Medicare for decades, but under President Trump’s leadership and working with the White House Anti-Fraud Task Force, CMS is protecting the Medicare Trust Funds and its beneficiaries by using advanced data analytics to identify fraud networks and stop suspicious payments before the check clears.”

The agency is further working to ensure that these “suppliers will no longer receive payments for healthcare items, services, or drugs furnished, ordered, or prescribed to Medicare beneficiaries.” CMS has several tools at its disposal to discover suspicious activity, including “data analytics, payment safeguards, enrollment authorities, and the Preclusion List.”

Details of two of the investigations into the 11 companies were provided. In one example, a provider based in Florida “submitted approximately $18.4 million in catheter claims over two consecutive days — $6.1 million for 500 beneficiaries on December 15, 2025, followed by $12.3 million for 777 beneficiaries the next day.” CMS blocked the company from receiving those payments.

In the second example, a company in Texas submitted “approximately $5.5 million in orthotics claims.” CMS investigators “interviewed six beneficiaries who said they did not know the ordering providers, had never heard of the company, and did not need the orthotics.” Additional claims for nine beneficiaries had “dates of service after their deaths.” CMS also ensured that these payments never reached the company.

Dr. Oz praised the success of his agency’s safeguards in preventing this massive fraud.

“CMS is cutting off 11 medical equipment suppliers tied to these abusive practices. Some had already been revoked from Original Medicare—then began billing Medicare Advantage instead. Losing access to one part of Medicare should never become an opportunity to exploit another. We’re closing that door,” he said. “We’re using advanced analytics and stronger safeguards to stop suspicious payments, protect Medicare beneficiaries, and keep taxpayer dollars away from bad actors.”