Trump Admin Withholds $1.4B Amid Fraud Crackdown
Vice President JD Vance’s anti-fraud task force has suspended roughly $1.4 billion in federal payments to home health and hospice providers across the country as the Trump administration ramps up its crackdown on…
Vice President JD Vance’s anti-fraud task force has suspended roughly $1.4 billion in federal payments to home health and hospice providers across the country as the Trump administration ramps up its crackdown on alleged abuse within Medicare and Medicaid programs.
The effort, led through a partnership with the Centers for Medicare & Medicaid Services (CMS), has focused heavily on providers operating in California, Minnesota, and several other states where officials say fraud schemes have become deeply embedded in the healthcare system.
According to Trump administration officials, nearly 90% of the providers whose payments were frozen have not contacted CMS since the suspensions were issued. Officials say that silence is raising additional red flags about whether many of the businesses were legitimate healthcare operations at all.
Administration sources told Fox News Digital that some of the providers had been collecting taxpayer-funded reimbursements for years while maintaining little to no communication with federal regulators. Officials described many of the operations as “ghost” providers that appeared to exist largely on paper while continuing to bill the government for services.
“The vice president’s task force continues to stop the flow of taxpayer funds before they fall into the hands of fraudsters and deliver savings to the American people,” a spokesperson for Vance told Fox News Digital. “This is great momentum in the fight for the President’s War on Fraud.”
President Donald Trump has made government waste and fraud a central issue during his second term, with healthcare billing abuse becoming a major target for federal investigators. CMS Administrator Dr. Mehmet Oz recently pointed to what he described as organized international fraud networks operating inside the United States healthcare system.
Speaking on “Jesse Watters Primetime,” Oz claimed investigators believe foreign actors tied to Russia, China, and Cuba have been connected to large-scale fraud operations involving hospice care, medical equipment, and federal reimbursement programs.
“We’ve got Russian government involvement, we believe, in Los Angeles,” Oz said. “We’ve got the Chinese government involved in a big fraud ring in New York.”
He also highlighted South Florida as another hotspot for alleged abuse, claiming the region contains an unusually high number of medical equipment suppliers compared to major retail chains.
The administration’s intensified scrutiny follows revelations that hundreds of hospice agencies in Los Angeles alone were suspected of fraudulent activity. Last month, Fox News Digital reported that 447 hospices and 23 home health agencies in the area had been suspended amid investigations into more than $600 million in questionable billing practices.
Federal officials say the crackdown extends beyond healthcare fraud. The Small Business Administration recently referred more than 562,000 suspected fraudulent pandemic-era loans to the Treasury Department for collection efforts. The loans, worth more than $22 billion combined, originated primarily through the Paycheck Protection Program and the COVID Economic Injury Disaster Loan program.
White House officials argued that many of the cases had already been flagged during the Biden administration but were never aggressively pursued for recovery.
California hospice leaders have also raised concerns about the ease with which questionable providers have entered the system. During a House Ways and Means Committee hearing in April, California Hospice and Palliative Care Association CEO Sheila Clark described visiting addresses listed as hospice providers only to find abandoned offices, retail storefronts, or locations with piles of unopened mail.
“How do you put a hospice in a burrito stand?” Clark asked lawmakers. “How do you put a hospice in a retail store?”
Her testimony added to growing criticism that state and federal oversight systems failed to detect fraudulent operations for years despite licensing and inspection requirements already in place.
Meanwhile, California Attorney General Rob Bonta recently announced the arrest of five people accused of operating a multimillion-dollar hospice fraud scheme that allegedly stole $267 million from Medi-Cal, California’s Medicaid system.
The administration has also pointed to the massive “Feeding Our Future” scandal in Minnesota as another example of widespread abuse involving taxpayer-funded programs. That case, which centered on fraudulent meal reimbursement claims, became one of the largest COVID-era fraud investigations in the country and helped fuel the administration’s broader push for stricter oversight and enforcement.