Federal program fraud may be costing taxpayers as much as $521 billion a year, a House report finds, and Republicans say the Biden-Harris years left the loopholes wide open.
House Republicans are rolling out a package of 14 bills after a House Energy and Commerce Committee report warned that federally subsidized healthcare programs are rife with fraud and abuse. Fox News Digital reported the committee released the findings Tuesday, citing a 2024 Government Accountability Office estimate that $233 billion to $521 billion in taxpayer dollars going to federal programs are lost to fraud every year.
The report notes that no separate estimate exists specifically for Medicare and Medicaid fraud. Still, Rep. Jodey Arrington has warned that Medicare and Medicaid fraud alone is costing taxpayers $1 million every minute, pointing to GAO figures that show up to $500 billion in annual government-wide losses.
Federal healthcare programs already account for 24% of federal spending, per figures the report drew from the Center on Budget and Policy Priorities. Medicaid spending averages 30.7% of state budgets. Every dollar stolen or wasted is a dollar not spent on care for people who need it.
House Energy and Commerce Committee Chairman Brett Guthrie, R-Ky., did not hold back about who let the problem run.
Guthrie told Fox News Digital:
"The amount of fraud that the Biden-Harris Administration allowed to go unchecked in government health programs is unacceptable. Every dollar stolen by fraudsters or wasted on improper payments is a dollar that cannot be used to support families in need who rely on these programs."
The committee report itself framed the damage in plain terms. Fraud is “impacting every single American, in one way or another.” It said taxpayers who fund benefit programs “are cheated by fraud, inflating healthcare costs that are passed along to everyone.” And it added: “Every dollar stolen from federal health care programs is a dollar that is not spent on high quality healthcare for those that need it most.”
Guthrie called the legislative package “commonsense steps” to help states recoup lost fraud dollars and close loopholes that invite abuse.
The report highlighted ballooning Medicaid-type costs in large blue states. California’s Medi-Cal spending is expected to rise from $83 billion a year in 2014 to $219.7 billion by 2027. New York is projected to spend 11% more on Medicaid from all funding sources in 2027, a total of $124 billion.
Those figures land while fraud and improper payments continue to siphon money that should go to legitimate care. States carry a heavy share of the load, and weak internal controls make the problem worse.
The committee report described how bad actors game the system. Providers submit multiple claims for a single service or bill for services and equipment for patients they never saw. Traditional enforcement still leans on a “pay and chase” model, pay first, try to claw the money back later.
That model is slow and leaky. The Department of Justice’s Operation Gold Rush uncovered Russian organized crime actors who billed more than $10 million in false claims through 30 medical supply companies they purchased in a years-long scheme. The report also flagged transnational schemes involving actors in Hong Kong, Georgia, Estonia, Pakistan and elsewhere who have tried to steal billions in U.S. taxpayer dollars.
When foreign criminal networks can buy shell companies and bill federal health programs, the problem is not a paperwork glitch. It is a failure of gatekeeping.
House Republicans are grouping the 14 bills into three categories: improving identification of fraud in state and federal health programs, enforcing anti-fraud rules, and holding states that allow fraud to run rampant accountable.
Rep. August Pfluger, R-Texas, the Republican Study Committee chairman, is leading a bill that would force states to designate a single role for internal financial controls of state Medicaid programs. Rep. Mike Rulli, R-Ohio, has a measure that would require each state to report annually to the federal government on potential Medicaid fraud vulnerabilities and the plan to fix them. Rep. Nick Langworthy, R-N.Y., is pushing legislation that would require states to check whether someone enrolling in Medicaid was already removed from another taxpayer-funded healthcare program.
The package is meant to shrink bureaucracy, make it easier for states to recoup lost dollars, and give officials stronger incentives to pursue fraudsters instead of papering over losses.
Arrington has also discussed a joint op-ed with Rep. Blake Moore highlighting the GAO’s government-wide loss figures. The political message is straightforward: taxpayers cannot afford open-ended leakage while legitimate beneficiaries wait for care.
The Trump administration is already prioritizing healthcare fraud crackdowns. Vice President JD Vance announced last week that 760,000 enrollees under the Affordable Care Act would be removed over fraud claims.
That move pairs with the House effort. One branch is scrubbing improper enrollment. The other is trying to lock down state and federal controls so the same schemes do not keep recycling. Together they treat fraud as a stewardship failure, not an accounting footnote.
The committee’s own language leaves little room for shrug-it-off excuses. When federal healthcare already takes nearly a quarter of federal spending, and Medicaid eats nearly a third of the average state budget, weak anti-fraud rules are a direct hit on families who play by the rules.
Taxpayers fund these programs. Patients who qualify deserve the care. Fraudsters and the officials who left the gates loose do not get a pass.
Washington spent years treating hundreds of billions in leakage like background noise. Republicans are finally putting the bill, and the blame, on the table.
