The U.S. House Committee on Oversight and Accountability's Task Force on Defending Constitutional Rights and Exposing Institutional Abuses held its inaugural hearing, exposing extensive vulnerabilities and massive fraud within state Medicaid Home and Community-Based Services (HCBS) waiver programs. Stricter oversight, enhanced verification systems, and legislative reforms are under debate as states confront billions of dollars in potential losses.
On June 3, 2026, the newly established House Task Force on Defending Constitutional Rights and Exposing Institutional Abuses, chaired by Representative Brandon Gill (R-Texas), held its first official hearing. Titled "Universal Basic Fraud: Vulnerabilities in Medicaid Waiver Programs," the panel examined how lack of verification, control failures, and structural loopholes have allowed systemic exploitation of state Medicaid Home and Community-Based Services (HCBS) programs.
Home care waiver programs, which are designed to fund non-medical support services like cooking, cleaning, and companionship for elderly and disabled individuals in their homes, have reportedly become targets for organized fraud, shell companies, and unverified self-directed care claims. Focusing heavily on audits from Ohio, the task force exposed weaknesses that could compromise the financial integrity of these public programs.
Witness testimonies from state auditors and investigative journalists painted a troubling picture of state-level oversight. The hearing detailed how millions of taxpayer dollars are routinely disbursed to unverified providers, including instances of billing for individuals who were deceased or incarcerated.
With state budgets increasingly strained by rising long-term care demands, the findings are prompting calls for federal intervention, the adoption of biometric authentication, and strict restrictions on paid family caregiving. Policymakers are now caught between the urgent need to protect public resources and the necessity of sustaining care for vulnerable populations who rely on home-based assistance.
Federal and state lawmakers are proposing strict anti-fraud measures following testimony showing billions of dollars in Medicaid waiver program exposure.
- Federal Hearing: The House Oversight Task Force held its first hearing on June 3, 2026, investigating systemic vulnerabilities in Medicaid HCBS waiver programs.
- Massive Fraud Exposure: Ohio Auditor of State Keith Faber testified that Ohio's Medicaid program has a potential fraud exposure of up to $4.4 billion, driven by a 15.6% ineligible recipient rate.
- Exploitation Mechanisms: Investigative reporting revealed an ecosystem of shell companies and unmonitored family-caregiver setups that bypass Electronic Visit Verification (EVV) systems.
- State Audit Successes: Faber's office has identified over $9 billion in unsupported or fraudulent expenditures across state programs since he took office in 2019.
- Legislative Action: Ohio lawmakers are debating the SHIELD Act (House Bill 795), which implements GPS tracking and biometric checks but faces opposition over a proposed ban on paying family caregivers.
Factual Core of the U.S. House Medicaid Fraud Hearing
The June 3, 2026, hearing of the Task Force on Defending Constitutional Rights and Exposing Institutional Abuses marked a major escalation in federal oversight of state-level Medicaid programs. Led by Chairman Brandon Gill, the task force focused its inquiry on the Home and Community-Based Services (HCBS) waiver programs, which allow states to bypass standard federal Medicaid rules to cover in-home, non-medical care. While the program’s intent is to keep elderly and disabled patients out of expensive institutional facilities, witnesses testified that the program's rapid growth has far outpaced state verification capabilities. The hearing analyzed the administrative structure of the programs, noting that the absence of pre-payment verification makes the system highly vulnerable to fraud.
Two primary witnesses provided detailed testimony. Luke Rosiak, an investigative reporter for The Daily Wire, described his multi-month investigation into what he termed "Medicaid millionaires." Rosiak’s research, which began with a review of a federal Medicaid spending database, uncovered numerous shell companies operating out of empty office parks that billed millions of dollars for home care services that were never provided.
Additionally, Keith Faber, the Ohio Auditor of State, provided data from his office's recent State Single Audit. Faber reported that his auditors identified widespread non-compliance, duplicate enrollments across state lines, and payments made to caregivers for periods when the recipients were hospitalized, incarcerated, or deceased. The joint testimonies established that the current structure of waiver programs lacks the necessary safeguards to protect public funds.
- Lack of Pre-payment Checks: State Medicaid systems operate on a "pay-and-chase" model, paying claims first and attempting to recover fraudulent funds later.
- Refugee Caregiver Networks: Luke Rosiak testified that certain networks exploit self-directed care rules, claiming high hours for family care without local verification.
- Senate Precedent: Prior to the June hearing, Rosiak presented similar findings to the Senate Small Business Committee in May 2026.
The Mechanics of Waiver Program Vulnerabilities and Medicaid Exploitation
Medicaid HCBS waiver programs operate under a different set of rules than traditional Medicaid. Under these waivers, states can allow beneficiaries to direct their own care, meaning they can select their own caregivers, including family members, neighbors, or friends. While this self-directed care model provides flexibility, it removes the professional oversight that traditional home health agencies provide. Investigative reporter Luke Rosiak testified that "a convicted fraudster can get approved to send unsupervised and untrained workers into elderly Americans' homes" because background checks are either bypassed or poorly enforced. This lack of oversight has allowed individuals with criminal histories of financial fraud to gain access to the system as paid caregivers.
Furthermore, the system relies heavily on self-reporting. In theory, Electronic Visit Verification (EVV) systems, mandated by the federal 21st Century Cures Act, require caregivers to check in via a mobile application or landline phone to verify their physical presence at the patient's home. However, state audits show that the EVV system is frequently bypassed. Caregivers can manually adjust timesheets, claiming "technical glitches," or use multiple devices to check in for multiple clients at the same time.
The hearing highlighted cases where a single caregiver billed for 24 hours of care per day for multiple clients simultaneously, indicating that state computers failed to flag these obvious conflicts. This combination of self-directed care and bypassed EVV checks has created a low-risk, high-reward environment for fraudulent billing.
- Manual timesheet overrides: Caregivers bypass Electronic Visit Verification systems by claiming mobile software errors.
- Simultaneous billing patterns: Multiple phones used to check in for separate clients at the same time.
- Database update lag: Delays in updating recipient eligibility when they are hospitalized or incarcerated.
In many states, the administration of these programs is split between multiple agencies, which further complicates oversight. In Ohio, the Department of Medicaid, the Department of Aging, and the Department of Developmental Disabilities all play a role in managing different waivers. This fragmentation leads to communication breakdowns. For example, when an individual is admitted to a nursing facility, their home care waiver should be suspended. However, because the eligibility databases of these departments do not communicate in real-time, the home care provider can continue billing for in-home services while the patient is actually in an institution. These administrative silos prevent the state from detecting and blocking fraudulent claims before payments are processed.
Audit Findings and Public Loss: The Hard Data in Ohio and Beyond
The scale of the financial loss in Ohio's Medicaid program is significant. During his testimony, Auditor Keith Faber revealed that his office's recent State Single Audit of Ohio's Medicaid program found an ineligible recipient rate of 15.6% in the samples tested. Extrapolating this error rate across the program's massive budget indicates a potential fraud-related exposure of up to $4.4 billion. Faber emphasized that these are not merely administrative errors, but represent public funds paid to individuals who did not meet the basic eligibility criteria for the program, or for services that were never rendered. This audit represents one of the most comprehensive documentations of public program vulnerability in recent years.
This exposure is part of a broader pattern of public loss that Faber’s office has uncovered. Since he took office in 2019, the Ohio Auditor's office has identified over $9 billion in unsupported or fraudulent public expenditures across various government programs, with Medicaid and pandemic-era unemployment programs representing the largest share of the losses. Faber explained that the state’s inability to reconcile its eligibility lists with other state databases—such as incarceration records and death certificates—is a primary cause of these losses. In some cases, caregivers continued to bill for services for months after the recipient had passed away, with the state processing the payments automatically because no system alert was triggered.
To put the audit findings in context, the chart below displays the potential fraud and unsupported spending exposure identified by Ohio Auditor Keith Faber. It compares the Medicaid waiver fraud exposure, the lower-bound estimate for waiver fraud, and the total unsupported expenditures identified across all Ohio state programs since 2019.
Waiver Program Demographics and Financial Comparisons
Ohio's Home and Community-Based Services (HCBS) waiver programs serve approximately 132,000 enrollees across several distinct waiver types. These waivers are designed to address the needs of specific populations, such as the elderly, individuals with physical disabilities, and those with developmental intellectual disabilities. However, the different rules and administrative structures of these waivers result in varying levels of cost and vulnerability. The table below compares Ohio's primary waiver programs across enrollment size, average cost compared to institutional care, and fraud vulnerability risk level.
| Waiver Program | Target Population | Enrollment Size (Est.) | Cost vs. Institutional Care | Fraud Vulnerability Risk |
|---|---|---|---|---|
| PASSPORT Waiver | Elderly (Age 60+) | ~22,000 ≈ Parity | 22% Lower Cost ▲ Leading | Moderate Risk ≈ Parity |
| Ohio Home Care Waiver | Physically Disabled (Under 60) | ~11,000 ▼ Behind | 18% Lower Cost ≈ Parity | High Risk ▼ Behind |
| Individual Options (IO) Waiver | Developmentally Disabled | ~25,000 ▲ Leading | 15% Lower Cost ≈ Parity | Low to Moderate Risk ▲ Leading |
The data shows that while all waiver programs offer significant cost savings compared to traditional nursing home care (with PASSPORT leading with a 22% lower cost per enrollee), they also present different levels of risk. The Ohio Home Care Waiver is categorized as "High Risk" due to its heavy reliance on independent, self-directed providers who operate outside of established home health agency structures. These independent providers are more likely to bypass EVV check-ins and manually submit timesheets, whereas agency-directed services under the Individual Options waiver feature more structured corporate compliance, reducing the rate of ineligible claims. This variation demonstrates that policy solutions must be tailored to the specific administrative structure of each waiver.
Legislative Responses: The SHIELD Act and Fraud Prevention Measures
In response to the growing audit findings and public pressure, the Ohio House of Representatives is considering a legislative package aimed at reforming Medicaid waiver programs. Originally introduced as the Safeguarding Healthcare Integrity through Electronic Location Data (SHIELD) Act, House Bill 795 (HB 795) has since been expanded into a broader anti-fraud bill. The bill seeks to replace the current "pay-and-chase" model with proactive, pre-payment verification systems. If passed, the legislation would require the Ohio Department of Medicaid to implement GPS-based tracking for all non-emergency medical transportation and home personal care services, preventing caregivers from billing for services if their location data does not match the patient’s home coordinates.
In addition to GPS tracking, the expanded bill mandates the use of biometric verification for high-risk providers. Caregivers would be required to verify their identity and presence using fingerprint scans, facial recognition, or voice verification at the start and end of each visit. The bill also increases the penalties for Medicaid fraud, elevating certain offenses to a fifth-degree felony and imposing mandatory fines ranging from $1,000 to $15,000. To encourage public participation in fraud detection, the bill establishes a whistleblower reward program, offering up to $10,000 for reports that lead to the successful recovery of stolen Medicaid funds. The bill represents the most aggressive legislative attempt to date to secure state Medicaid programs from exploitation.
"Since taking office in 2019, my administration has identified more than $9 billion in unsupported or fraudulent public expenditures across various state programs. We cannot continue to rely on a system that pays claims first and asks questions later. The State of Ohio must implement proactive, pre-payment verification systems like biometric checks and real-time database matching to protect taxpayers."
— Keith Faber, Ohio Auditor of State, House Testimony
The proposed legislation has received support from fiscal conservatives who argue that the state cannot afford to lose billions of dollars to fraud. However, the bill has also run into significant opposition from advocacy groups and providers. The debate highlights the difficulty of implementing anti-fraud measures without disrupting the delivery of services to those in need. Lawmakers must now decide how to balance the need for program integrity with the practical realities of care delivery.
Broader Policy Implications: Workforce Shortages vs. Program Integrity
The most controversial aspect of the proposed Ohio Medicaid reforms is a provision in the substitute version of House Bill 795 that would prohibit family members from being paid as caregivers under Medicaid waiver programs. Currently, many disabled individuals rely on family members who are compensated through self-directed care waivers, allowing them to remain at home. Proponents of the ban, citing testimonies like Luke Rosiak’s, argue that paying family members creates an unmanageable fraud risk, as there is no way for the state to verify if a mother actually provided the claimed hours of care to her disabled child. They argue that eliminating paid family care is the only way to close this massive loophole.
However, disability advocacy groups warn that a ban on paid family caregiving would have catastrophic consequences for the state's long-term care system. They argue that first, prohibiting paid family care would force many disabled Ohioans out of their homes and into nursing facilities, which are significantly more expensive and often provide a lower quality of life.
Second, the state’s home healthcare workforce is already facing a severe shortage, and banning family caregivers would immediately create a vacancy for over 10,000 professional positions. Third, family members who are forced to quit their jobs to provide uncompensated care would face severe financial hardship, potentially shifting the cost burden to other state welfare programs.
These concerns have led to intense public debate, with advocates urging lawmakers to remove the family care ban and focus instead on improving Electronic Visit Verification technology.
- Stricter Electronic Visit Verification (EVV): Transitioning to GPS-based real-time tracking to confirm physical presence.
- Biometric Authentication: Implementing fingerprint or facial recognition check-ins for high-risk, independent providers.
- Pre-Payment Database Integration: Automating checks against death registries and incarceration databases before disbursing funds.
- Implement Pre-Payment Database Matching: Link Medicaid billing systems with state prison records, hospital admission databases, and death registries to automatically block payments for individuals who cannot receive care.
- Strengthen Electronic Visit Verification (EVV): Require GPS-enabled, real-time check-ins and eliminate manual timesheet overrides for high-risk, independent providers.
- Establish Biometric Verification: Phase in fingerprint or voice recognition check-ins for self-directed and family care programs to confirm the identity of the caregiver.
- Increase Provider Background Checks: Require fingerprint-based background checks for all independent caregivers, disqualifying individuals with histories of financial fraud or abuse.
- Expand Whistleblower Incentives: Implement and publicize the $10,000 reporting reward program to encourage caregivers and families to report fraud within their networks.
Administrative Context: Under the proposed SHIELD Act, the Ohio Department of Medicaid would be given expanded authority to immediately suspend payments to any provider suspected of fraud. Currently, the state must navigate a lengthy administrative appeal process before withholding funds, allowing suspect providers to continue billing and collecting payments for months during an active investigation.
Conclusion and Regulatory Disclaimer
The findings of the House Oversight Task Force’s June 3, 2026, hearing highlight the urgent need for structural reform in state Medicaid waiver programs. While the self-directed care model provides flexibility and comfort for thousands of disabled and elderly Americans, its lack of verification has allowed significant waste, fraud, and abuse to occur. As states like Ohio consider legislative responses like the SHIELD Act, lawmakers face the challenge of securing public funds without harming the vulnerable populations who rely on home-based care. The integration of biometric verification, real-time database matching, and stricter provider oversight will be critical for restoring integrity to Medicaid programs, ensuring that resources are preserved for those who truly need them.
Sources and References
- U.S. House Committee on Oversight and Accountability - Task Force Hearing Wrap-Up: house.gov
- Ohio Auditor of State - State Single Audit Reports and Testimony: ohioauditor.gov
- The Daily Wire - Investigative Reporting on Medicaid Waiver Vulnerabilities: dailywire.com
- Statehouse News Bureau - Ohio House Bill 795 (SHIELD Act) Legislative Coverage: statenews.org
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