House Ways and Means hearing spotlights large‑scale Medicare fraud in hospice, home health and DME

Members of the House Committee on Ways and Means and a panel of providers, insurer investigators and a Medicare beneficiary on Thursday laid out examples of large‑scale fraud they say is draining Medicare and harming patients.

"Imagine being told in effect that you are at the end of your life when you are not," said Dr. Lynn E. Yanni, who testified that she was wrongly enrolled in hospice in 2024 and briefly locked out of needed care. Her account was one of several offered to illustrate how sham providers and brokered enrollments can deny beneficiaries access to treatment and create months‑long appeals fights.

Why it matters: Committee members and witnesses said Medicare loses roughly $60 billion a year to fraud, waste and abuse and that some local markets — notably Los Angeles County — show startling growth in hospice and home‑health billing that is inconsistent with demographic trends. Sheila Clark, president and CEO of the California Hospice and Palliative Care Association, told the committee that in Los Angeles home‑health payments reached about $1.7 billion in 2024 and hospice billing rose sharply alongside a surge in newly enrolled agencies.

What witnesses recommended: The panel urged a mix of near‑term operational changes and longer‑term policy fixes: - Stronger front‑end vetting for new providers and more frequent on‑site surveys of flagged agencies, to prevent sham companies from enrolling and billing Medicare. - A beneficiary notification requirement so people receive prompt written notice when a hospice election is recorded in their Medicare record. - Expanded use of analytics and machine learning to flag anomalous claims at or before payment, coupled with human review (a ‘‘stop‑and‑verify’’ rather than pay‑and‑chase model). - Better data sharing between CMS, private payers and law enforcement, including wider use of suspended‑provider lists and all‑payer claims data to identify cross‑jurisdiction schemes.

Examples cited: Witnesses described common patterns used by fraud networks — clusters of provider addresses, newly formed companies billing narrow, high‑reimbursement items (especially durable medical equipment), and beneficiary recruitment through brokers. ACO representatives said they had flagged multi‑million‑dollar claim lines tied to a single beneficiary and that those investigations sometimes reduce shared savings for legitimate providers caught up in the resulting reviews.

Enforcement, politics and pardons: Several members pressed witnesses about criminal prosecutions and expressed concern that presidential pardons for some convicted health‑care fraudsters weaken deterrence. Witnesses uniformly said convicted fraudsters should be held accountable and that robust DOJ and OIG resources are critical to follow through on referrals from CMS and private payers.

Legislative activity: Representative Nanette Sanchez and others urged movement on bills that would tighten hospice enrollment rules, require beneficiary notice and provide pathways to unwind fraudulent hospice elections. Members also discussed proposals to give CMS authority to deactivate NPI numbers for providers convicted of fraud.

What CMS is doing: Witnesses and several members praised recent CMS pilot work — including the Fraud Detection Operations Center — that uses near‑real‑time analytics to flag suspicious payments. Insurer witnesses said private plans regularly use dashboards, prepayment checks and investigator teams to pause or probe suspect claims and urged closer public‑private coordination and broader data access.

No formal votes or decisions were taken at the hearing. Committee members requested further documents and promised follow‑up oversight to track CMS, OIG and DOJ responses.

The committee adjourned after several hours of testimony and questioning, leaving the shape of any legislative package to future deliberations.