The Trump Administration’s Anti-Waste in Health Care Campaign

Why It Matters

Cutting health‑care fraud could save billions for taxpayers and improve the sustainability of entitlement programs, while AI‑based oversight may set a new standard for federal program management.

Key Takeaways

• WISeR model adds AI prior authorization to Medicare fee‑for‑service
• CRUSH RFI seeks private‑sector AI solutions for fraud across health programs
• Medicare skin‑substitute spending surged to $10 billion, prompting rule changes
• Six‑month DME vendor moratorium targets dubious supplier practices
• State investigations focus on Medicaid fraud in California, Maine, Minnesota, New York, Florida

Pulse Analysis

Federal health‑care spending is climbing toward 7.3% of GDP by 2036, putting pressure on policymakers to rein in waste. Medicare and Medicaid, the nation’s largest entitlement programs, process billions of claims each year, creating fertile ground for fraud and abusive billing. Historically, oversight relied on manual audits, which struggle to keep pace with the volume and sophistication of schemes. The Trump administration’s recent budget and policy moves reflect a strategic shift toward technology‑enabled enforcement, recognizing that traditional methods alone cannot safeguard the fiscal health of these programs.

At the heart of this shift are two AI‑centric initiatives: WISeR and CRUSH. Launched in June 2025, the Wasteful and Inappropriate Service Reduction (WISeR) model integrates machine‑learning algorithms into Medicare’s fee‑for‑service prior‑authorization workflow, automatically flagging low‑value or potentially fraudulent services. Early targets include high‑cost skin‑substitute treatments, which ballooned from $242 million in 2019 to over $10 billion in 2024. Meanwhile, the Comprehensive Regulations to Uncover Suspicious Healthcare (CRUSH) request for information invites private‑sector innovators to propose AI‑driven rule changes across Medicare, Medicaid, CHIP, and ACA subsidies. Complementary actions—such as a six‑month moratorium on new durable medical equipment vendors and state‑level Medicaid investigations—tighten the regulatory net, aiming to eliminate dubious suppliers and curb long‑standing fraud hotspots.

If successful, these measures could generate billions in savings and set a precedent for AI‑based governance in other federal programs. However, the rollout carries risks: overly aggressive algorithms might inadvertently deny necessary care or pressure Congress to increase entitlement funding to offset perceived shortfalls. Industry stakeholders are watching closely, balancing the promise of reduced waste against the need for transparent, accountable AI systems. Ultimately, the administration’s anti‑waste campaign could reshape how the United States monitors and funds health‑care entitlements, influencing both fiscal policy and patient outcomes for years to come.