Medicaid is the primary program providing comprehensive coverage of health and long-term care to 83 million low-income people in the United States and accounts for one-fifth of health care spending. Medicaid is jointly financed by states and the federal government but administered by states within federal rules. The recently passed House budget resolution targets cuts to Medicaid of up to $880 billion or more over a decade. While several options appear to be under consideration to significantly reduce Medicaid spending, President Trump publicly said recently about Medicaid, “We are not going to touch it. Now, we are going to look for fraud.” Speaker Johnson has said, “Medicaid is hugely problematic because it has a lot of fraud, waste, and abuse.” Although fraud, waste, and abuse can be related concepts (and all fall under a broader “program integrity” umbrella), they are also distinct in important ways (Box 1). These terms apply to other government health care programs, private health insurance, and other government programs more broadly.1 On March 11, 2025, the White House released a statement saying most federal spending lost to fraud is from entitlement programs such as Medicaid and Medicare, citing “improper payment” estimates, without clarifying (as GAO does) that “improper payments” are not a measure of fraud or abuse and most improper payments are the result of missing documentation or missing administrative steps, and are not necessarily payments made for ineligible enrollees, providers, or services.
Speaker Johnson has referenced $50 billion in annual fraudulent payments (a figure that may reflect improper payments rather than fraud). In debates about broader Medicaid spending reductions, Republicans may try to recast policy changes such as adding work requirements to Medicaid and restricting the use of provider taxes as addressing fraud, waste, and abuse. Despite talk about eliminating fraud, the President’s recent order to remove Inspectors General (IGs), who are responsible for providing independent oversight of federal programs, from at least 17 government agencies—including HHS—appears to run counter to the stated focus on fraud, waste, and abuse. Recent KFF polling shows, while the public thinks that reducing fraud and waste in government health programs could lead to reductions in overall federal spending, many (60% of Republicans, 55% of Democrats, and 51% of independents) also think reducing fraud and waste in government programs could result in a reduction of benefits. Overall, most Americans (77%) hold favorable views of Medicaid, including six in ten Republicans (63%), and at least eight in ten independents (81%) and Democrats (87%).
This brief explains what is known about improper payments and fraud and abuse in Medicaid and describes ongoing state and federal actions to address program integrity.