The Centers for Medicare & Medicaid Services announced Friday that it has prevented more than $1.6 billion in potentially fraudulent Medicare laboratory payments since the start of the second Trump administration. The agency released a breakdown of enforcement actions that it says contributed to that total and described the technologies and tactics used to identify suspicious billing.
CMS cited several categories of enforcement activity. The agency reported saving $732 million tied to 157 providers who were revoked from the Medicare program. More than $500 million came from 185 suspensions that affected roughly 600 laboratories. Agency officials also identified $276 million from 442 overpayments and $127 million in potentially fraudulent payments linked to law enforcement referrals.
CMS attributed these results to the expanded use of advanced analytics, including artificial intelligence and machine-learning models. The agency said these tools have helped it identify several types of laboratory fraud, such as billing for medically unnecessary services and billing for patients with no established relationship to ordering providers.
"When laboratories bill Medicare for tests they never performed, it drains the Medicare Trust Fund and diverts resources away from beneficiaries who need them," said Mehmet Oz, M.D., CMS administrator, in a statement. He added that, under the White House Anti-Fraud Task Force, CMS has built a technology-powered fraud prevention operation to target scams across the health care system, citing areas from laboratory testing to hospice care, medical equipment and autism therapy.
The agency placed the lab enforcement results within a broader set of fraud-prevention figures. For fiscal year 2025, CMS said its fraud prevention efforts resulted in $42 billion in savings. In fiscal year 2026 to date, CMS reported identifying $1.8 billion in Medicare overpayments, collecting $378 million in overpayments and suspending more than $539 million in suspected fraudulent payments.
CMS also highlighted the work of its Fraud Defense Operations Center, which it said has accounted for more than $371 million in Medicare suspended payments involving 267 providers and suppliers since Jan. 1.
The actions CMS described fall into several enforcement categories that the agency has used more frequently. Revocations remove a provider’s ability to bill Medicare and accounted for $732 million in savings from 157 revoked provider records. Suspensions—temporary holds on payments when strong evidence of potential fraud exists—were tied to more than $500 million in potentially fraudulent payments across 185 suspensions from roughly 600 labs. Overpayment recoveries and law enforcement referrals also contributed to the total sum blocked.
CMS did not provide further detail on the specific laboratories, providers, geographic distribution of actions, or the precise algorithms or models used. The agency attributed results broadly to its analytics capabilities and coordination with law enforcement.
Reducing health care fraud, particularly in Medicare and Medicaid, has been a stated priority for the current administration. CMS and other HHS leaders have taken additional measures this year beyond lab-focused enforcement. In July, HHS Secretary Robert F. Kennedy Jr. announced CMS would defer approximately $867.5 million in federal Medicaid payments to California and $199 million to Minnesota. In May, CMS said it would hold $1.3 billion from California, which the agency described as the largest deferral it had ever made. CMS previously announced similar actions involving Minnesota in February.
Those deferrals are separate from the lab-related blocks but reflect a broader push by CMS and the administration to use payment controls and administrative actions to address suspected improper billing and program integrity concerns.
CMS framed the lab enforcement announcements as part of a continuing, technology-driven approach to fraud prevention under the White House Anti-Fraud Task Force. The agency said it will continue using analytics, targeted suspensions, revocations and law enforcement referrals to address suspected fraud across multiple areas of the health care system.
The source did not report further operational details, such as timelines for reinstating suspended payments, criteria for selecting providers for revocation, or specifics about coordination with particular law enforcement agencies beyond general referrals.
CMS officials emphasized that preventing fraudulent laboratory payments protects the Medicare Trust Fund and preserves resources for beneficiaries. By stopping payments that the agency characterizes as potentially fraudulent, CMS aims to redirect funds to legitimate care and reduce losses that could otherwise affect program solvency or beneficiary access.
The announcement reinforces a broader federal emphasis on using payment controls and data-driven surveillance to confront fraud in Medicare and Medicaid. CMS presented the lab actions as one element of its larger fraud-prevention portfolio, which the agency says has produced substantial savings in recent fiscal years.
Sources: Centers for Medicare & Medicaid Services announcement; statement from CMS Administrator Mehmet Oz, M.D. (Details reported are limited to those released by CMS.)
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