The Trump administration expands its use of AI in the hunt for
healthcare fraud
[May 22, 2026]
By ALI SWENSON
NEW YORK (AP) — The U.S. Department of Health and Human Services on
Thursday announced it is supercharging its use of artificial
intelligence to police how states and other recipients of federal health
dollars are auditing their programs. The move is intended to tamp down
risks of fraud and save the government money.
The department will use ChatGPT and other AI tools to analyze audit
reports from all 50 states on an ongoing basis, said Gustav Chiarello,
the assistant secretary for financial resources who is leading the new
program.
“It’s classic big government: Everyone files an audit and it lands with
a thud and no one does anything about it,” Chiarello said in an
interview. “Here, with AI, we’re able to dig into it.”
The move builds on the department's embrace of generative AI for
investigating state Medicaid programs, automating administrative tasks
and editing text. AI tools can be a powerful aid in finding patterns or
problems across large documents, but critics say the government should
use them with caution because they frequently make mistakes and can have
unintended biases.
The Trump administration and Vice President JD Vance’s anti-fraud task
force have spent recent months promoting efforts to crack down on fraud
in the Medicaid and Medicare programs as well as in student loan
applications and other areas. Those efforts have also involved using AI
technology to flag likely fraud, Federal Trade Commission Chairman
Andrew Ferguson said recently on Fox News.
States, local governments, nonprofits and higher education institutions
that spend at least $1 million in federal money a year are required to
submit annual audits. The new initiative will use AI to analyze those
audits from HHS-funded programs, including state Medicaid programs and
federal grantees in research, addiction services and more, Chiarello
said.
Recipients that do not file the required reports or resolve problems in
them could face a loss of funding. The initiative was first reported by
The Wall Street Journal.
Critics have blasted the administration's anti-fraud efforts, noting
most have been targeted at Democratic states and at times have 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 mistake in data it had used to help justify a New York
Medicaid fraud investigation.
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The Department of Health and Human Services building is seen in
Washington, April 16, 2025. (AP Photo/Jose Luis Magana, File)
 Asked about safeguards against the
AI tools making mistakes, Chiarello noted that officials were
evaluating public reports rather than uncovering new information. He
said the tools were intended to make grantees better stewards of
federal dollars.
Rob Weissman, co-president of the consumer rights advocacy 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 and nonpartisan way.
“The AI is kind of beside the point when you assess what their
actual objectives are, rather than what they pretend they are,” he
said.
HHS said it has sent letters to governors and treasurers in all 50
states alerting them to the new initiative.
“This letter serves as your formal notification that HHS will no
longer treat chronic audit noncompliance, repeat deficiencies,
material weaknesses, or delinquent audit obligations as matters that
may remain unresolved through indefinite informal follow-up,” read
one of the letters reviewed by the AP.
Chiarello said he has been in touch with his counterparts in other
federal departments in hopes that they follow his lead.
“It would be fairly easy for the other agencies to use our
technology and jump on it,” he said.
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Associated Press writer Geoff Mulvihill in Haddonfield, New Jersey,
contributed to this report.
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