The Regulator | July 6, 2026

Rules. Money. Medicine. Decoded daily.

DOJ and HHS charge 455 defendants in record $6.5 billion health care fraud takedown, with $10 billion in Medicare payments stopped before they went out the door. On June 23, 2026, the Department of Justice and HHS Office of Inspector General announced the 2026 National Health Care Fraud Takedown, the largest in department history. Charges hit 90 doctors and other licensed medical professionals across 56 federal districts and 45 states, including a record 295 Medicaid fraud defendants tied to more than $518 million in false claims. CMS suspended 1,079 providers and revoked billing privileges for 1,403 more, meaning any practice that shares a billing address, referral pattern, or ownership stake with a named defendant should expect a payment hold or a program integrity letter in the next 90 days. Investigators seized more than $182 million in cash, vehicles, and jewelry. Confidence: High. Sources: https://www.justice.gov/opa/pr/national-health-care-fraud-takedown-results-455-defendants-charged-connection-over-65 and https://oig.hhs.gov/newsroom/media-materials/2026-national-health-care-fraud-takedown/

CMS proposes 2027 home health pay update and new DME enrollment rules, comments due August 31. CMS published its Calendar Year 2027 Home Health Prospective Payment System proposed rule on July 6, 2026, covering the annual rate update, a temporary behavior adjustment, recalibrated case-mix weights, and new Medicare provider enrollment requirements for durable medical equipment, prosthetics, orthotics, and supplies suppliers. Home health agencies and DME suppliers have until 5 p.m. EDT on August 31, 2026, to file comments before the rule is finalized for payment year 2027. Confidence: High. Source: https://www.federalregister.gov/documents/2026/07/06/2026-13602/calendar-year-2027-home-health-prospective-payment-system-hh-pps-rate-update-requirements-for-the-hh

Medicare Advantage plans get a net $13 billion raise for 2027, even as CMS tightens two upcoding loopholes. CMS’s final Contract Year 2027 Rate Announcement, released April 6, 2026, excludes diagnoses from audio-only telehealth visits and from “unlinked” chart reviews and health risk assessments not tied to a clinical encounter, closing a pathway the agency has linked to billions in overpayments. But CMS also froze its planned update to the V28 risk model rather than recalibrate it with newer claims data, softening the hit. Net effect: MA plans see a 2.48% payment increase, about $13 billion, or nearly 5% including risk-score trend, for 2027. Confidence: High. Sources: https://www.cms.gov/newsroom/press-releases/cms-finalizes-2027-medicare-advantage-part-d-payment-policies-strengthen-accountability-long-term and https://medicare.chir.georgetown.edu/cms-takes-aim-at-upcoding-ending-unlinked-chart-reviews-in-medicare-advantage/

DEA and HHS avoid a telehealth “prescribing cliff,” extending remote controlled-substance rules through the end of 2026. The fourth temporary extension, effective January 1 through December 31, 2026, lets DEA-registered practitioners keep prescribing Schedule II-V controlled medications by audio-video telemedicine, and certain opioid use disorder medications by audio-only telemedicine, without a prior in-person exam. More than 7 million such prescriptions were issued in 2024 alone. No permanent rule exists yet. Patients and prescribers relying on virtual behavioral health, pain management, or addiction treatment should expect another deadline fight in December. Confidence: High. Source: https://www.federalregister.gov/documents/2025/12/31/2025-24123/fourth-temporary-extension-of-covid-19-telemedicine-flexibilities-for-prescription-of-controlled

HHS opens a public comment docket on scheduling a kratom compound as a controlled substance, comments due July 31. The Office of the Assistant Secretary for Health published a notice on July 6, 2026, seeking input on placing 7-hydroxymitragynine, a compound found in some kratom products, above a specified threshold in Schedule I under the Controlled Substances Act. Retailers and manufacturers of kratom products have until July 31, 2026, to comment before HHS sends its recommendation to the Attorney General. Confidence: Medium (proposal stage, no scheduling decision yet). Source: https://www.federalregister.gov/documents/2026/07/06/2026-13608/temporary-placement-of-7-hydroxymitragynine-above-a-specified-threshold-in-schedule-i-request-for

CMS presses ahead on annual, AI-assisted Medicare Advantage audits while a court fight over clawback math continues. A federal district court in Texas vacated the extrapolation provisions of CMS’s 2023 RADV audit rule on September 25, 2025, and HHS appealed on November 21, 2025. Rather than wait, CMS’s January 27, 2026 memo commits to auditing all eligible MA plans annually, using variable sample sizes of 35 to 200 enrollees per contract, with new audit years starting roughly every three months and artificial intelligence tools speeding up chart review. Payment year 2020 audits began in February 2026. If the appeal succeeds, CMS could apply extrapolated, plan-wide repayment estimates rather than per-sample findings, sharply raising the dollars at stake for MA plans found to have unsupported diagnoses. Confidence: Medium on the appeal timeline. Sources: https://www.groom.com/resources/court-rules-that-cms-cannot-extrapolate-medicare-advantage-risk-adjustment-audit-results/ and https://www.raapidinc.com/blogs/radv-audits-2026/

Florida opens its newest Medicaid disability waiver to every eligible enrollee statewide on July 1, with 17,000 people still waiting for services. The Intellectual and Developmental Disabilities Comprehensive Managed Care program, built by 2023’s SB 2510 as a 700-slot pilot before going statewide under operator Florida Community Care on October 1, 2025, opened enrollment on July 1, 2026, to anyone already on the iBudget waiver or the Statewide Medicaid Managed Care long-term care waiver. As of January 2026, 16,996 Floridians were on the iBudget waitlist, nearly a third of them for 10 years or more. The expansion does not add new waiver slots by itself, so families should watch whether managed care enrollment actually shortens the wait or just changes who administers it. Confidence: Medium on near-term wait-time impact. Source: https://floridaphoenix.com/2026/02/17/legislative-tussle-ahead-over-medicaid-managed-care-for-people-with-intellectual-disabilities/

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