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Health care leaders have long viewed fraud, waste, and abuse as compliance issues. But as more provider organizations accept financial risk through accountable care and other value-based arrangements, fraud, waste, and abuse are no longer simply compliance concerns. They are increasingly financial performance risks that can directly affect benchmark attainment, shared savings results, and care delivery strategy. Inappropriate utilization can distort shared savings calculations, influence regional benchmark trends, complicate risk adjustment methodologies, and ultimately undermine efforts to deliver high-quality care efficiently.
The financial impact is substantial. According to CMS, Medicare Fee-for-Service improper payments totaled nearly $29 billion in FY2025, underscoring the scale of spending that can be influenced by billing errors, inappropriate utilization, and other program integrity issues.
The challenge is not simply the amount of wasteful spending moving through the health care system. It is the fact that many of the patterns now attracting federal scrutiny no longer look obviously fraudulent at first glance.