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Tuesday, September 8 · 3 stories
- Legal
CMS Announces $3.4 Billion Medical Equipment Fraud Enforcement Action
CMS has taken enforcement action against a medical equipment supplier fraud scheme totaling $3.4 billion. The action targets fraudulent billing practices involving durable medical equipment suppliers. While the press release does not specify the effective date of sanctions or detail which programs (Medicare, Medicaid, or both) were affected, enforcement actions of this scale typically involve multi-program billing fraud and can result in provider terminations, payment suspensions, and enhanced screening requirements. The action signals heightened federal scrutiny of DME billing across government health programs.
Monday, September 7 · 3 stories
- Legal
CMS Blocks $1.6 Billion in Lab Payments Using AI-Powered Fraud Detection
On August 28, 2026, CMS announced it has blocked over $1.6 billion in potentially improper Medicare payments to diagnostic laboratories since the start of the current administration, using expanded AI-powered enforcement tools for payment suspensions and revocations. The enforcement actions target laboratories billing Medicare and represent a significant escalation in CMS program integrity efforts using predictive analytics. While these actions focus on Medicare fee-for-service, the AI-powered detection methods and aggressive enforcement posture signal heightened scrutiny that will likely extend to Medicaid managed care laboratory networks and state Medicaid program integrity operations.
- Legal
Fifth Circuit to Hear Mifepristone Access Case Amid Medicaid Coverage Implications
A three-judge panel on the Fifth Circuit Court of Appeals will hear oral arguments in a case challenging nationwide distribution of mifepristone, the medication abortion drug. The case could result in restrictions on mifepristone access that would affect Medicaid beneficiaries and state Medicaid pharmacy programs. Oral arguments are scheduled for next week, with a decision timeline uncertain. The outcome could require state Medicaid agencies and managed care plans to adjust pharmacy benefits, provider networks, and utilization management protocols for medication abortion services covered under Medicaid.
- Legal
HRSA Issues FQHC Scope of Project Manual Governing Provider Arrangements and 340B Operations
On August 11, 2026, HRSA released its Health Center Program Scope of Project Policy Manual, providing comprehensive guidance on what constitutes an FQHC's approved scope of project under Section 330 of the Public Health Service Act. The manual took effect immediately upon release. It addresses provider-patient relationships, arrangements with other providers, and 340B drug pricing program operations for federally qualified health centers. The guidance affects how FQHCs structure their service delivery, contractual relationships, and participation in federal programs, with implications for Medicaid managed care plans contracting with FQHCs and state agencies overseeing network adequacy.
Friday, September 4 · 7 stories
- Legal
DOJ Expands Fraud Enforcement Division with Added Staff and Data Resources
The Department of Justice's National Fraud Enforcement Division is expanding its fraud enforcement operations targeting recipients of federal funds, including Medicaid providers and managed care organizations. DOJ is increasing investigative staff and deploying enhanced data analytics capabilities to detect fraud, with particular focus on schemes involving foreign nationals and government program integrity. The expanded enforcement posture takes effect immediately, reflecting DOJ's renewed prioritization of fraud prevention and recovery across federal healthcare programs. Medicaid providers, health plans, and state agencies should anticipate heightened scrutiny of billing practices, program compliance, and financial arrangements.
- Legal · ND
OIG Inspection Finds North Dakota Medicaid Fraud Control Unit in Compliance
The HHS Office of Inspector General completed its periodic inspection of the North Dakota Medicaid Fraud Control Unit in 2025, examining the unit's compliance with federal certification standards for investigating and prosecuting Medicaid provider fraud and patient abuse cases. The inspection covered staffing, case management, prosecution coordination, and reporting requirements. North Dakota's unit was found to meet federal requirements for continued federal financial participation at the 75 percent match rate. OIG conducts these inspections every three years for all state fraud control units as required by federal law.
- Legal · OR
OIG Finds Health Share of Oregon Failed Federal Requirements in Prior Authorization Denials
The HHS Office of Inspector General found that Health Share of Oregon, a Medicaid coordinated care organization, did not always comply with federal and state requirements when denying prior authorization requests. The audit identified deficiencies in the CCO's denial processes, including inadequate documentation and failure to meet regulatory standards for timely and appropriate prior authorization determinations. Health Share of Oregon serves Medicaid beneficiaries in the Portland metro area under Oregon's 1115 waiver. The findings carry implications for federal compliance oversight of Medicaid managed care organizations' utilization management practices.
- Legal · KS
OIG Finds Kansas Failed to Enforce Mental Health Parity Rules for MCO Prior Authorization
The HHS Office of Inspector General determined that Kansas did not ensure its Medicaid managed care organizations complied with federal mental health and substance use disorder parity requirements related to prior authorization. The audit found Kansas MCOs applied more restrictive prior authorization requirements for behavioral health services than for medical/surgical services, violating parity rules. OIG recommended Kansas implement oversight mechanisms to ensure MCO compliance with parity requirements and recover inappropriate payments if applicable. This represents federal enforcement action against a state's failure to monitor MCO compliance with long-standing but frequently unenforced parity rules.
- Legal · NY
OIG Finds New York Failed to Enforce Mental Health Parity in Medicaid MCO Prior Authorization
The HHS Office of Inspector General determined that New York did not ensure selected Medicaid managed care organizations complied with mental health and substance use disorder parity requirements for prior authorization processes. The findings indicate state oversight gaps in enforcing the Mental Health Parity and Addiction Equity Act (MHPAEA) as it applies to Medicaid managed care. OIG identified instances where MCOs imposed more restrictive prior authorization requirements on behavioral health services compared to medical/surgical benefits. The report will likely prompt corrective action plans from New York and increased scrutiny of parity compliance in other states' Medicaid managed care programs.
- Legal · AZ
OIG Finds Arizona Failed to Monitor MCO Mental Health Parity Compliance on Prior Authorization
The HHS Office of Inspector General found that Arizona did not ensure its selected Medicaid managed care organizations complied with federal mental health and substance use disorder parity requirements related to prior authorization processes. The review identified gaps in state oversight of whether MCOs applied comparable authorization standards for behavioral health and medical/surgical benefits, as required under the Mental Health Parity and Addiction Equity Act. The report recommends Arizona strengthen monitoring and enforcement mechanisms to verify MCO compliance with parity requirements. This review follows increased federal scrutiny of parity compliance across states and managed care plans.
- Legal · CO
Colorado Sues Trump Administration Over Medicaid Gender-Affirming Care Funding Ban
Colorado Attorney General Phil Weiser filed a lawsuit Wednesday in U.S. District Court in Massachusetts challenging a Trump administration rule that prohibits states from using federal Medicaid funds for gender-affirming healthcare. The lawsuit, joined by other Democratic-led states, argues HHS lacks authority to categorically ban state coverage of this medical care. The challenge affects state Medicaid programs that currently cover gender-affirming services and could determine whether states retain flexibility to define medically necessary services under their state plans.
Thursday, September 3 · 1 story
- Legal
CMS Orders Corrective Action Plan from Medicare Contractor Over AI Review Delays
CMS required Virtix Health, the contractor operating the WISeR Model in Washington, to submit a corrective action plan after failing to meet 72-hour turnaround requirements for prior authorization and prepayment determinations. The enforcement action follows findings that the company's AI-assisted review processes did not comply with statutory timeframes. While the WISeR Model applies to Medicare fee-for-service, the action signals CMS's expanding scrutiny of automated utilization management tools and could inform future oversight of similar technologies in managed care programs.
Monday, August 31 · 6 stories
- Legal · FL
Florida AG Sues Express Scripts and Prime Therapeutics for Alleged Price Fixing
Florida's attorney general filed a lawsuit against pharmacy benefit managers Express Scripts and Prime Therapeutics alleging their partnership agreement artificially depressed pharmacy reimbursement rates through price fixing. The complaint represents the latest legal challenge to the Express Scripts-Prime arrangement. The lawsuit alleges anticompetitive conduct that affects how pharmacies are paid under prescription drug benefit arrangements. This matters for Medicaid managed care organizations that contract with these PBMs or their affiliates for pharmacy services, as the allegations relate to fundamental pricing mechanisms that affect both network pharmacy relationships and overall drug cost structures.
- Legal · ID
Federal Court Rules Idaho Cannot Bar Abortion When Pregnancy Threatens Patient Health
U.S. District Judge B. Lynn Winmill ruled that Idaho's abortion ban violates the 14th Amendment when a pregnancy threatens a patient's physical or mental health, marking the first post-Dobbs ruling to find a constitutional right to abortion in certain scenarios. Idaho's Attorney General has appealed. The decision could affect health exceptions in the 13 states with near-total abortion bans, five of which (Idaho, Arkansas, Mississippi, Oklahoma, South Dakota) have no health exception. Legal experts suggest this could begin a gradual legal challenge to the scope of Dobbs, potentially reaching the Supreme Court.
- Legal
Specialty Providers Challenge Georgetown Study on No Surprises Act IDR Costs
Specialty physician associations representing anesthesiologists, radiologists, and emergency physicians are disputing a Georgetown University study that estimates independent dispute resolution under the No Surprises Act has generated $22 billion in unnecessary healthcare spending. The associations argue the study's methodology is flawed. The No Surprises Act, which took effect in January 2022, established an IDR process for resolving payment disputes between out-of-network providers and insurers. While the law primarily affects commercial insurance, the dispute highlights ongoing tensions over payment methodologies that could inform Medicaid managed care network adequacy and payment dispute resolution policies.
- Legal · PA
Pennsylvania, 23 States Sue Over Trump Administration Title X Grant Conditions
Pennsylvania Governor Josh Shapiro and nearly two dozen states filed suit Thursday in U.S. District Court in Maryland challenging new federal conditions on Title X family planning grants for the 2027-2032 funding cycle. The Trump administration's Office of Population Affairs requirements include ending diversity, equity and inclusion policies and what HHS terms "support for gender ideology." Title X provides Medicaid-funded family planning services including cervical cancer screening, STI testing, and contraceptive care primarily for low-income and uninsured populations. The lawsuit seeks to vacate these new grant requirements.
- Legal · AR
Seventh Circuit Upholds Arkansas PBM Dispensing Fee Rule Against ERISA Preemption Challenge
The Seventh Circuit Court of Appeals ruled Wednesday that Arkansas may enforce its 2024 regulation requiring pharmacy benefit managers to include dispensing fees in pharmacy reimbursements, rejecting a challenge that federal ERISA law preempts the state rule. The regulation authorizes Arkansas to impose additional fees when the state insurance commissioner determines current reimbursements are not fair and reasonable, and mandates health plans report data on pharmacy reimbursement relative to Medicaid pricing. The ruling is effective immediately. The decision matters for Medicaid managed care organizations and their PBM vendors operating in Arkansas, as it affirms state authority to set minimum pharmacy reimbursement standards including dispensing fees and requires plans to report pharmacy payment data benchmarked against Medicaid rates.
- Legal · VA
Chesapeake Regional Reaches Tentative Deferred Prosecution Deal in Perwaiz Fraud Case
Federal prosecutors have reached a tentative deferred prosecution agreement with Chesapeake Regional Medical Center related to criminal charges stemming from former OB-GYN Javaid Perwaiz's unnecessary surgeries and sterilizations between 2010 and 2019. The deal requires the hospital to admit certain facts, accept an independent monitor, repay health care programs, and create a $12.8 million patient fund. The hospital received $18.5 million from public and private payers — including Medicaid — for procedures Perwaiz performed, some of which prosecutors allege were misclassified. If finalized, the agreement would allow Chesapeake Regional to avoid a criminal trial and potential exclusion from Medicare and Medicaid, while a separate civil lawsuit with more than 1,000 plaintiffs remains ongoing.
Saturday, August 29 · 2 stories
- Legal · IN
Indiana AG Discusses Medicaid Fraud Enforcement in Wide-Ranging Interview
Indiana Attorney General Ford addressed Medicaid fraud enforcement as part of a broader interview covering multiple policy topics, including the state's opioid litigation efforts and data center regulation. The attorney general defended the administration's record on these issues. No specific new Medicaid fraud actions or enforcement changes were announced. The interview provides insight into the state's current enforcement priorities and approach to Medicaid program integrity.
- Legal · OH
OhioHealth Settles DOJ Antitrust Case Over Managed Care Contracting Practices
OhioHealth entered a consent judgment with the U.S. Department of Justice and Ohio Attorney General resolving allegations that its managed care contracting practices violated federal and state antitrust laws. The settlement follows a DOJ complaint filed in February 2026 accusing OhioHealth of anticompetitive conduct in its health plan contracting. OhioHealth filed a motion to dismiss rather than answer the complaint but reached a consent judgment instead. The settlement takes effect immediately upon court approval. This matters for health systems and managed care plans negotiating provider contracts, as it signals DOJ enforcement priorities on contracting practices that may suppress competition or inflate reimbursement rates.