On March 16, 2026, President Donald Trump announced the formation of the Task Force to Eliminate Fraud, with the mission of advising the president and coordinating federal efforts to “combat widespread fraud, waste, and abuse in federal benefit programs.”

A nationwide problem

In the executive order announcing the creation of the TFEF, Trump singled out Minnesota, alleging that Medicaid fraud in that state “could total billions [of dollars].” Medicaid payments in Minnesota will be frozen by the federal government if the state’s planned remediation strategy – which includes re-verifying every Medicaid provider – is not completed by May 31 of this year.

Despite massive fraud – including a $10.6 billion operation by an Estonian criminal organization targeting federal programs in California, Florida, Illinois, New Jersey, and New York – uncovered by the U.S. Dept. of Justice’s “National Health Care Fraud Takedown” in 2025, only Minnesota is facing a Medicaid freeze. However, the Centers for Medicare and Medicaid Services recently shifted the way it handles fraud, signaling that it may withhold federal funding from states where fraud is merely suspected, rather than proven. Could Pennsylvania have its funds frozen? And can fraud be prevented?

Fraud & improper payments

The Government Accountability Office tracks fraud across all federal programs, as well as improper payments (which may result from error, incomplete information, or fraud). The total figure for improper payments ($162 billion in improper payments in 2024) is lower than that for separately counted fraud (between $233 billion and $521 billion).

The National Health Care Anti-fraud Association is a nongovernmental partnership among public and private insurers and enforcement agencies. NHCAA estimates that health care fraud (involving both public and private insurers) costs consumers and taxpayers tens of billions of dollars a year – between 3 percent and 10 percent of U.S. he – lth care costs, topping out at a potential high end of $300 billion annually.

Much of what has been uncovered in Minnesota is not necessarily fraud or criminal activity. For example, improper payments are not necessarily the result of fraud. The Kaiser Family Foundation explains, “Improper payments are any payments that should not have been made or that were made in an incorrect amount (including overpayments and underpayments) under statutory, contractual, administrative, or other requirements. It includes any payment to an ineligible recipient, any payment for an ineligible good or service, any duplicate payment, any payment for a good or service not received, and any payment that does not account for credit for applicable discounts.”

Allegations of health care fraud in Minnesota have centered on the state’s Medicaid program, which serves low-income individuals. As part of the Permanent Error Rate Measurement program, the federal Centers for Medicare and Medicaid Services audits all 50 states on a rolling three-year basis. CMS reports that the improper payment rate for Medicaid (based on the cycles of 2023, 2024, and 2025) was 6.12 percent, which amounted to $37.39 billion. CMS attributes the majority of the Medicaid improper payments (77.17 percent) during the most recent three-year cycle to insufficient documentation, which the agency says “is generally not indicative of fraud or abuse.”

The Children’s Health Insurance Program (CHIP) improper payment rate based on 2023, 2024, and 2025 was 7.05 percent ($1.37 billion). CMS attributes more than half of CHIP improper payments (56.07 percent) to insufficient documentation. The agency attributes the higher improper payment rates in recent years to reduced flexibility in reporting requirements after the end of the federally declared public health emergency related to COVID-19.

Pennsylvania was part of the 2025 audit, with an improper payment rate for Medicaid and CHIP of 0.3% ($63.8 million). As a point of comparison, Minnesota’s projected rate was 2.2 percent ($253.6 million). In 2025, Wisconsin’s rate (and dollar amount) were highest at 9.1% ($731.3 million), and the rate in Kansas was the lowest at 0.1 percent ($2.5 million).

Pa. provider verification

Provider fraud can involve actual medical providers billing for services that were either never delivered or not medically necessary. It can also be perpetrated by bad actors who are not medical providers using stolen National Provider Identifier (NPI) numbers to bill insurers for real or fake services.

To bill any insurance provider – including commercial providers like UnitedHealthcare, and public providers like CHIP, Medicaid, and Medicare – medical professionals must first obtain an NPI from CMS. Medical practices must also obtain an NPI2 for the practice to participate in any insurance program, public or private. The process for obtaining an NPI or an NPI2 is federally managed and is the same in all 50 states.

Each state has its own system for enrolling providers in the state’s CHIP, Medicaid and Medicare programs. In Pennsylvania, the Dept. of Human Services runs an online system called PROMISe. The system website explains, “To be eligible to enroll, practitioners in Pennsylvania must be licensed and currently registered by the appropriate state agency. Out-of-state practitioners must be licensed and currently registered by the appropriate agency in their state, and they must provide documentation that they participate in that state’s Medicaid and/or CHIP program. Other providers must be approved, licensed, issued a permit, certified by the appropriate state agency, or if applicable certified under Medicare.”

According to Pa. DHS press liaison Brandon Cwalina, the state verifies each provider’s NPI against the NPI file provided by the federal government’s National Plan and Provider Enumeration System. Cwalina provides additional details about provisions of the state’s Medicaid and CHIP verification process that apply to the types of services highlighted as high-risk in Minnesota, noting that Pennsylvania has separate licensing requirements for providers delivering Applied Behavior Analysis therapy and other services for individuals with autism spectrum disorder. Only after completing these licensing requirements can the provider enroll in Pennsylvania’s Medical Assistance and obtain a PROMISe number.

Pennsylvania’s verification system is robust.

“Once an enrollment application is submitted to Pa. DHS,” Cwalina explains, “it goes through a series of federal database checks and background checks, which typically take five to seven days. These checks include information received from the U.S. Department of Health and Human Services Office of Inspector General, U.S. Department of Justice, the Pa. Office of the Attorney General, state professional licensing boards, other state agencies, other states, [and] the CMS Data Exchange database,” among others.