With the OIG’s May 30, 2025, announcement that they are seeking $454.4 million in funding to fight healthcare fraud, healthcare providers can expect increased governmental scrutiny despite Trump’s budget cutbacks and staff layoffs.  The OIG justifies its budget request by pointing out that for every $1 invested, there is an expected return of $11 in government recoveries and receivables, which fuels the Trump administration’s fight on fraud, waste, and abuse in health care. What this means for health care providers is intensified scrutiny and likely use of AI as a tool to evaluate big data to identify potential false claims, fraud, outliers, etc. Considering the OIG’s 90-page new General Compliance Guidance, healthcare providers’ self-policing strategies and internal audits are more important than ever as the heat turns up on alleged fraud and false claims.

It may seem like hair-splitting, but including the wrong diagnostic codes for malnutrition on hospital inpatient claims – using codes for severe malnutrition in place of other forms of malnutrition – is a costly mistake. The estimated overpayment as a result of these coding errors is a reported $1 billion. Because the payment error rate was so high at a colossal 31%, Medicare-Severity Diagnosis Related Group ("MS-DRG") applicable entities must take note and prepare for a marked increase in Department of Health and Human Services Office of Inspector General ("OIG") audits for these coding practices. The Centers for Medicare & Medicaid Services ("CMS") also plans to implement review practices for malnutrition coding on a sample of inpatient claims. The increased payer audits will result in severe financial damage for hospitals and other MS-DRG applicable entities if they do not mitigate coding and documentation risks.