We have received text from S. 2066: Medicare Transaction Fraud Prevention Act. This bill was received on 2025-06-12, and currently has 3 cosponsors.
Here is a short summary of the bill:
This bill, known as the Medicare Transaction Fraud Prevention Act, aims to test a new approach to overseeing payments for durable medical equipment (DME) and clinical diagnostic laboratory tests within the Medicare program. Here are the key components:
Establishment of a Pilot Program
The Secretary of Health and Human Services is tasked with creating a 2-year pilot program starting no later than January 1, 2026. This pilot intends to examine the effectiveness of using predictive risk-scoring algorithms to monitor transactions related to DME and clinical diagnostic laboratory tests for potential fraud.
Scope of the Pilot Program
- The program will focus specifically on transactions involving items and services provided to certain Medicare beneficiaries who voluntarily opt in to participate and receive electronic notices.
- Participating beneficiaries have the right to withdraw from the program at any time.
Predictive Risk-Scoring Algorithm
The pilot program will involve a predictive risk-scoring algorithm. This algorithm will assess the risk of fraud for each relevant transaction. Factors that may influence this risk score include:
- Lack of prior relationship between beneficiaries and service providers.
- Unusual billing patterns from providers.
- Changes in payment processes.
- Changes in ownership of service providers.
Key Requirements of the Program
The Secretary will adopt and implement the predictive risk-scoring algorithm with several requirements:
- The algorithm will score transactions on a scale from 1 (least risky) to 99 (most risky).
- Any identified high-risk transactions may be suspended, pending review.
- Beneficiaries will receive notifications and have the opportunity to address any claims flagged as high-risk.
Communication and Fraud Reporting
The program will also require establishing clear communication methods with beneficiaries and service providers regarding the algorithm's use, including:
- Sending alerts and summaries of transactions flagged for risk.
- Information to assist beneficiaries in reporting suspected fraud.
Human Review Process
All suspensions or reviews of transactions must involve a human review process, ensuring that algorithmic assessments are verified by individuals.
Collaboration with Industry
The Secretary will collaborate with industry representatives, particularly suppliers of durable medical equipment, to develop and implement the pilot program effectively.
Definitions
The bill includes specific definitions for:
- Applicable items or services: This refers to durable medical equipment and clinical diagnostic laboratory tests.
- Relevant transactions: Claims for payment for applicable items or services rendered to beneficiaries participating in the pilot program.
Overall Intent
Overall, the bill aims to reduce fraud within Medicare by implementing a technological approach that closely monitors transactions involving certain medical services and supplies, enhancing the integrity of the program.
Relevant Companies
None found.
Senator Tim Sheehy Bill Proposals
Here are some bills which have recently been proposed by Senator Tim Sheehy:
- S.2139: PRIME Act
- S.2138: Buy-to-Budget Flexibility Act
- S.2137: Expedited Delivery Act
- S.2136: Smart Pricing Practices Permanence Act
- S.2135: A bill to modify other transaction authority, and for other purposes.
- S.2097: COVID–19 Military Backpay Act of 2025
You can track bills proposed by Senator Tim Sheehy on Quiver Quantitative's politician page for Sheehy.
This article is not financial advice. See Quiver Quantitative's disclaimers for more information.
