Dr. Oz: ‘We’re Experiencing About $100 Billion of Theft a Year’ in Medicare and Medicaid Fraud
CMS Administrator Dr. Mehmet Oz made a stunning claim about how much money disappears from Medicare every year, and what he says fixing it could mean for the program's survival into the next generation.
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For retirees whose monthly budgets already flex around the $202.90 standard Part B premium and a $283 annual Part B deductible in 2026, a number tossed off by the country’s top Medicare official this week deserves more than a headline glance. In a CNBC interview that aired September 8, 2026, CMS Administrator Dr. Mehmet Oz said the Medicare and Medicaid programs are losing roughly $100 billion a year to theft, and he argued that the pandemic effectively trained a generation of criminal organizations to migrate from other rackets into health care billing.
That framing matters because the money at stake is concrete. It is the same trust fund that pays the hospital bills of today’s 65-year-olds and, if it holds, their children’s bills too.
Why This Is a Retirement Story
The line from the interview that Medicare beneficiaries should sit with is this one: Dr. Mehmet Oz said that “if we could just take the fraud out of Medicare, we would double the life expectancy of the Medicare trust fund, which means not only would you have it for your retirement, but it could be there for your kids as well.”, according to Centers for Medicare & Medicaid Services
Trust fund solvency is usually discussed as an actuarial abstraction. Oz reframed it as a household planning question. Every dollar diverted by a fake supplier is a dollar not available to cover the $1,736 inpatient hospital deductible a beneficiary might face after an admission next year, and it is a dollar pulled forward against the program’s runway.
Unglamorous Fix: Stop Paying the Claims
Oz credited Kim Brandt, who runs the program integrity work at CMS, with a large prevented-loss total achieved through what he described as the least cinematic tool in enforcement: refusing to release payments in the first place. Chasing a fraudster after the wire has cleared is expensive and slow. Holding suspect claims inside the agency until they can be verified is cheap. The point of emphasizing the plainness is that the biggest gains in Medicare integrity may come from tightening the front door rather than from courtroom victories.
Frontier AI, Aimed At Thinking Like A Crook
On enforcement technology, Dr. Mehmet Oz said CMS is “very, very actively involved with all the frontier models,” and that “if you use AI to get a bank manager to think like a fraudster and do the things they would have done to prevent what they’re about to do, it actually works.”
In plain language: reviewers are using large AI models to simulate the schemes a criminal would run against a given billing code, region, or provider type, then building the intercepts before the scheme shows up in real claims data. It is red-teaming applied to Medicare billing.
Where The Schemes Are Showing Up
Oz was specific about the geography. Dr. Mehmet Oz said CMS placed a moratorium on durable medical equipment suppliers in South Florida, and pointed to Queens, New York, where he described “a massive fraud scheme with social adult day care” in which operators were “basically paying seniors to play mahjong.” He also cited hospice fraud in Los Angeles and home care operators in Philadelphia running parallel criminal enterprises. These are characterizations offered in a television interview, not charging documents, and the foreign-government and organized-crime attributions should be read as claims by the administrator pending any formal case filings.
Legitimate suppliers do bear some paperwork burden when moratoria and prepayment reviews expand. That is a real cost worth acknowledging.
What A Beneficiary Should Take From It
Strip away the mahjong halls and the frontier AI, and the investing takeaway for anyone at or near retirement is straightforward. The value of enrolling in Medicare is only as durable as the trust fund behind it. Readers can review the CMS fact sheet on 2026 Part A and B premiums and deductibles to see how their own out-of-pocket exposure is shifting next year, and weigh supplemental coverage and drawdown assumptions with that runway question in mind (we mapped the surcharges and coverage gaps that catch retirees off guard, IRMAA included, in a free Medicare guide here). Fraud enforcement, in Oz’s telling, is what buys the program another generation.
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AJ has spent the past 10 years writing about financial markets at The Motley Fool. His coverage centers on technology stocks and the broader macroeconomic trends, from interest rates to geopolitics, that shape where markets are headed next. AJ is drawn to the stories where big-picture economics and individual companies collide.
