The Trump administration expands its use of AI in the hunt for healthcare fraud
NEW YORK– The U.S. Department of Health and Human Services announced Thursday that it is ramping up its use of artificial intelligence to monitor how states and other recipients of federal health funds audit their programs. The move aims to reduce the risk of fraud and save the government money.
The department will use ChatGPT and other AI tools to continuously analyze audit reports from all 50 states, said Gustav Chiarello, the assistant secretary for financial resources who leads the new program.
“It’s classic big government: Everyone files an audit and it lands with a thud and no one does anything,” Chiarello said in an interview. “Here, thanks to AI, we can dig into the question.”
The move builds on the department’s adoption of generative AI to investigate state Medicaid programs, automate administrative tasks and edit text. AI tools can be invaluable in identifying patterns or problems in large documents, but critics say the government should use them with caution because they frequently make mistakes and can have unintentional bias.
The Trump administration and Vice President JD Vance’s Anti-Fraud Task Force have spent recent months promoting efforts to combat fraud in the Medicaid and Medicare programs as well as in student loan applications and other areas. These efforts have also involved the use of AI technology to flag likely fraud, Federal Trade Commission Chairman Andrew Ferguson said recently on Fox News.
States, local governments, nonprofit organizations and institutions of higher education that spend at least $1 million in federal money annually are required to submit annual audits. The new initiative will use AI to analyze audits of HHS-funded programs, including state Medicaid programs and federal grants in research, substance abuse services and more, Chiarello said.
Recipients who fail to file required reports or resolve issues related to them could experience a loss of funding. The initiative was first reported by the Wall Street Journal.
Critics blasted the administration’s anti-fraud efforts, pointing out that most targeted Democratic states and sometimes reflected a tendency to attack first and gather the facts later. On at least one occasion, the administration acknowledged to The Associated Press that it made a major error in the data it used to justify an investigation into New York Medicaid fraud.
Asked about AI tools’ safeguards against errors, Chiarello noted that officials were evaluating public reports rather than discovering new information. He said the tools are aimed at making beneficiaries better stewards of federal money.
Rob Weissman, co-president of the consumer rights group Public Citizen, said he doesn’t think the administration is seriously concerned about fraud and doesn’t trust it to use AI tools in a fair, nonpartisan way.
“AI is not really relevant when it comes to assessing what their real goals are, rather than what they say they are,” he said.
HHS said it sent letters to governors and treasurers in all 50 states alerting them of the new initiative.
“This letter constitutes your formal notice that HHS will no longer treat chronic audit noncompliance, repeated deficiencies, material weaknesses, or outstanding audit obligations as matters that may remain unresolved through indefinite informal follow-up,” reads one of the letters reviewed by the AP.
Chiarello said he was in contact with his counterparts in other federal departments in the hope that they would follow his lead.
“It would be pretty easy for other agencies to take our technology and jump into it,” he said.
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Associated Press writer Geoff Mulvihill in Haddonfield, New Jersey, contributed to this report.
