CMS Uses Advanced Analytics to Target Fraudulent Medicare Laboratory Billing

CMS Uses Advanced Analytics to Target Fraudulent Medicare Laboratory Billing - Healthcare Law Update - October 2026 - Brach Eichler
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Published Date: 10/1/2026

On August 28, 2026, the Centers for Medicare & Medicaid Services (CMS) announced that its enforcement efforts had stopped more than $1.6 billion in potentially improper Medicare laboratory payments since the beginning of 2025. The figure includes $732 million in estimated savings from terminating 157 laboratory providers from the Medicare program, more than $500 million in potentially fraudulent payments halted through payment suspensions involving 185 laboratories, more than $276 million in overpayments recovered from 442 laboratories, and $127 million in potentially fraudulent payments prevented following 85 law-enforcement referrals. CMS said the actions targeted billing patterns, including claims for laboratory services that were not performed, medically unnecessary testing, upcoding, and testing for patients who had no established relationship with the ordering provider.

CMS attributed these results in part to its increased use of advanced analytics, including artificial intelligence and machine-learning models, to identify unusual billing patterns in Medicare fee-for-service claims. According to CMS, these tools can identify combinations of testing, results, billing, documentation, and provider relationships that warrant further review and can allow the agency to flag, hold, reject or deny claims before Medicare funds are paid. For laboratories and other healthcare providers, the initiative is a reminder that CMS is using increasingly sophisticated methods to identify potentially improper billing and that claims should be supported by the services actually provided and by appropriate clinical documentation.

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FOR MORE INFORMATION, CONTACT:
Keith J. Roberts | 973.364.5201 | kroberts@bracheichler.com
Shannon Carroll | 973.403.3126 | scarroll@bracheichler.com
Paul J. DeMartino, Jr. | 973.364.5228 | pdemartino@bracheichler.com

*This is intended to provide general information, not legal advice. Please contact the authors if you need specific advice.

Related Practices:   Healthcare Law, Litigation

Related Industry:   Healthcare