UNPACKING DOGE CLAIMS — Biotech entrepreneur Vivek Ramaswamy, co-leader of President-elect Donald Trump’s Department of Government Efficiency, is eyeing Medicare and Medicaid as potential sources to cut federal spending by trillions, Ben reports. The goal of DOGE — an outside group that will recommend spending and regulation cuts — is a tall task that would likely involve cutting entitlement programs to extract significant savings. Ramaswamy said last week on CNBC that “hundreds of billions of dollars in savings” could come from just “basic program integrity measures” in Medicare, Medicaid and Social Security. He’s generally in the right ballpark for the numbers. HHS estimated that, in fiscal year 2024, Medicare and Medicaid accounted for about $86 billion in improper payments, and other estimates peg fraud and waste higher annually. But the devil’s in the details. Jessica Farb, managing director of the Government Accountability Office’s health care team, noted that most of the improper payments in HHS’ estimates are due to insufficient documentation. “If these documentation errors were corrected, it is very possible that these payments would no longer be considered improper and therefore there would not be any ‘savings’ to the programs,” Farb said, adding that she doesn’t know what estimates Ramaswamy was using. “Improper payment rate is not an estimate of fraud or waste.” Controlling fraud might be more difficult than Ramaswamy suggests because many before him have pointed to curbing fraud, waste and abuse as a way to control government spending. Experts on health care fraud say there are ways to reduce it. “Internal controls are extremely important in trying to deter fraudulent activity from occurring, and to be honest, the government has the worst system of any organization,” Patrick Malloy, program coordinator at the University of New Haven’s health care fraud, waste and abuse program, told Pulse. He suggested the government could follow the private sector by auditing its waste control processes annually and reporting on their findings. Fraud in private organizations is generally about 5 percent of revenues, he said, compared with up to 15 percent in government. Still, others are more skeptical that Ramaswamy’s vision could be achieved. Jacob Elberg, a law professor at Seton Hall University who focuses on health care fraud, said Ramaswamy’s comments reflect “a lack of knowledge and understanding of the nature of health care fraud.” “Even aggressive estimates of healthcare fraud put the total amount of health care fraud at $100-200 billion annually, but nobody has ever suggested that is low-hanging fruit,” Elberg said in an email to Pulse. It would likely require a dramatic increase in enforcement personnel or fundamentally changing how care is delivered — with more preapproval requirements and delays, he wrote. AIR BUD? CARTER JOINS TEAM DOGE — Rep. Buddy Carter (R-Ga.), who is running to be chair of the Energy and Commerce Committee’s Health Subcommittee, said Thursday he’s joining the Congressional DOGE Caucus. Carter could be a potentially influential voice in the efforts to cut spending through the advisory group, given his background and potential power over health care legislation. A pharmacist, Carter has focused on regulations for the drug-pricing middlemen known as pharmacy benefit managers this Congress. “I am proud to join the Congressional DOGE Caucus and tackle the rampant waste, fraud and abuse that defines our government’s bureaucracy,” Carter said. WELCOME TO FRIDAY PULSE. The roller coaster of lame-duck package negotiations will soon be over. Send your tips, scoops and feedback to bleonard@politico.com and ccirruzzo@politico.com and follow along @_BenLeonard_ and @ChelseaCirruzzo.
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