ACP: Federal Initiative on Health Care Fraud Is Too Wide-Ranging, Could Affect Patient Care

As part of the initiative, Medicaid funding is already being deferred in Minnesota for alleged fraud and a moratorium has been placed on Medicaid enrollment for certain suppliers

April 24, 2026 (ACP) -- The American College of Physicians is warning that a new federal initiative to combat health care fraud could hinder patient care and inappropriately put clinicians under a microscope.

“Measures to prevent and address fraud should not interfere with physicians' ability to provide proper medical care,” Dr. Leslie F. Algase, chair of the ACP Medical Practice and Quality Committee, wrote in a March 30 letter to CMS Administrator Dr. Mehmet Oz.

While ACP supports efforts to prevent fraud, Algase wrote that heavy-handed enforcement can create “an atmosphere where physicians [are made to] believe that all their behavior is suspect. This undermines efficient medical care and places patients at risk from interference with the medical decision-making process.”

ACP wrote the letter in response to a CMS request for information on a White House initiative called Comprehensive Regulations to Uncover Suspicious Healthcare (CRUSH).

In February, Vice President J.D. Vance, Secretary of Health and Human Services Robert F. Kennedy Jr., and Oz announced three steps intended to crack down on Medicare and Medicaid fraud:

1. Postpone $259.5 million in Medicaid funding in Minnesota, where federal benefits fraud has been alleged, “to prevent payment of questionable claims while further investigation is complete.”
2. Impose a moratorium on Medicare enrollment for certain suppliers of durable medical equipment, prosthetics, orthotics and supplies.
3. Call on Americans to support the CRUSH initiative.

“We are replacing the old ‘pay and chase’ model with a real-time ‘detect and deploy’ strategy,” Kennedy said, “using advanced AI tools to identify fraud instantly and stop improper payments before they go out the door.”

While CMS is asking for public input, the agency has already posted a website outlining its efforts.

In the ACP letter, Algase emphasized that “fraud enforcement efforts should attempt to avoid wide-ranging corrective policies.”

As she explained, withholding Medicaid funds in Minnesota “was not directed at specific instances of fraud but rather at a broad category of health care services determined to be ‘high-risk.’ While certain services paid for by the Medicaid program do carry a higher risk for fraud relative to others, withholding payment for an entire group of services unfairly punishes physicians who comply with the rules and risks harming patients by diminishing access to care.”

Algase added that it is important for federal officials to understand the true extent of waste, fraud and abuse in Medicaid, which she stated is less than 1.0 percent across all states and territories, based on 2024 fiscal year data.

“This simple analysis suggests that this is not a systematic issue and can largely be explained by a relatively few instances of fraudulent and unscrupulous behavior,” she wrote. “If this is the case, directing resources to the enforcement of waste, fraud and abuse may not be an efficient endeavor and would impose an opportunity cost for improving public health programs elsewhere.”

ACP is also concerned about federal plans to use AI to improve health care efficiency and combat waste, fraud and abuse. “Using AI to identify and discontinue fraudulent behaviors can be an indispensable practice to reduce waste and improve efficiency in public health programs,” Algase wrote, “but it should not impede or be regarded as a substitute for the authentic understanding and experience that physicians bring.”

In the big picture, she wrote, “enforcement measures should ease the process of combating fraudulent behaviors and trust physicians to provide efficient, high-quality care to their patients. Implementing informed and well-investigated policies can help make public programs a reliable and efficient resource for all Americans.”

Back to the April 24, 2026 issue of ACP Advocate