The Centers for Medicare & Medicaid Services (CMS) and the Education Department’s Office of Federal Student Aid are using real-time fraud detection and closer coordination with investigators and other agencies to identify suspicious activity before taxpayer dollars leave government accounts, officials said during a Nov. 5 GovExec webinar.
Their challenge is keeping those defenses responsive as fraud schemes evolve and spread across programs, while ensuring that legitimate beneficiaries can still receive services. Officials described efforts to connect automated analysis with human decisions and give program staff the information they need to adjust fraud controls.
Bethany Messick, deputy director of the Data Analytics and Systems Group in CMS’s Center for Program Integrity, said the agency combines claims screening, provider monitoring, investigations, and policy reviews to protect its programs.
CMS reported $41.9 billion in Medicare program integrity savings in fiscal year 2025, with a return of $22.30 for every $1 invested in those activities, according to an agency fact sheet. It separately reported $4.1 billion in savings for Medicaid and the Children’s Health Insurance Program.
The Medicare total includes avoided costs, improvements in payment accuracy, and recoveries. Cost avoidance, including provider revocations and automated claim denials, accounted for 68% of the savings, CMS reported.
Track fraud across the full cycle of service
Jordan Burris, head of public sector at identity verification company Socure, said agencies face coordinated adversaries that use shared devices, domains, and automated infrastructure to target multiple government programs. Fragmented information about identities can leave agencies without the context needed to detect those connections, he said.
“Fraud is like running water. It is going to find the path of least resistance,” by probing claims processes, call centers, and other points of contact, said Burris, a former chief of staff in the White House Office of the Federal Chief Information Officer.
That requires monitoring throughout a person’s engagement with an agency and the ability to adjust controls as tactics change, he said.
Burris cautioned that agencies could lose visibility when they rely on technology providers without retaining access to the intelligence behind decisions. Program leaders need to understand what is happening within their programs and use that information to adapt, he said.
At CMS, Messick said more than 300 models continuously examine provider behavior and alert staff to patterns that fall outside expected norms. Investigators assess those alerts alongside additional data analysis to determine whether further action is warranted.
Within its authorities, CMS can suspend payments during an investigation when there is a credible allegation of fraud, she said. The agency also reviews policy gaps and uses targeted reviews and education to address providers’ compliance problems.
“We are stopping money before it goes out the door,” Messick said.
Preserve access for legitimate recipients
Richard Lucas, acting chief operating officer of the Office of Federal Student Aid, said fraud controls must reflect the mission of helping students obtain aid while protecting public funds.
The office uses real-time fraud detection on the Free Application for Federal Student Aid, he said. Applicants flagged by the system can present additional credentials to verify their identities, and the office works with schools to validate legitimate students.
Lucas said feedback from colleges and universities helps the office understand who is getting through its controls and whether detection settings are creating barriers for eligible applicants. That feedback can inform adjustments to the sensitivity of fraud screening.
At CMS, Messick said artificial intelligence-enabled analytical tools can help staff process and organize data more quickly, assess potential false positives, and prepare documents for human review. Subject matter experts remain responsible for decisions before the agency acts, she said.
Share intelligence with investigators and agencies
CMS’s Fraud Defense Operations Center and Medicaid Fraud War Room bring agency staff and law enforcement counterparts together to discuss emerging schemes and coordinate responses. CMS also works with agencies such as the Department of Veterans Affairs and the Treasury Department to share data, Messick said.
Effective sharing requires legal agreements and protections that give the right people access to usable, actionable information, she noted.
Coordination with the Education Department’s inspector general and other agencies supports identity and eligibility checks for student aid applicants, Lucas said.
Burris called for agencies to establish a common understanding of the types of fraud they are confronting and share information about adversaries’ tactics. Insights from one agency’s models could help another agency prepare for related threats, he said.
“I’m always going to be an advocate for more sharing for the collective defense,” Burris said.