RFK Jr. reveals MULTI-BILLION Medicare fraud scheme where doctors prescribe pricey, unnecessary wound-care treatment, pocket cash

"The doctors who prescribed them would get six percent of the sales cost. And so, they were incentivized to prescribe more expensive products," Sec. Kennedy told Vice President JD Vance at the 2026 MAHA Summit.

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Kennedy explained that while European Medicare prices remained around 35 cents, American spending increased from $135 to $2,000 per cubic inch.

"So 2019, we were paying $200 million. Last year, we spend $14 billion," said Kennedy. "All stolen. It's all stolen. And we were on track to spend $23 billion this year. We put an end to it, and now we have driven that cost down to somewhere around a billion dollars."

The New York Times reported that Medicare paid nearly $15 billion for skin substitutes in 2025, up from under $1 billion in 2019. Some products exceeded $21,000. A recent House Oversight roundtable reported growth from $200 million to $14.4 billion over the same period.

The pricey products are used on chronic wounds. Investigations found grafts were unnecessarily applied repeatedly to elderly patients, including those in hospice. Individual patients generated millions of dollars in claims shortly before their deaths, according to reports. There have been several criminal cases regarding the fraud.

In 2025, Alexandra Gehrke and Jeffrey King, owners of wound-graft companies, were sentenced to 15.5 and 14 years in prison after pleading guilty to a $1.2 billion false claim fraud scheme, in which much of the funds came from Medicare.

In June 2026, as part of the White House Fraud Task Force, the Justice Department charged 455 defendants in health care fraud schemes totaling over $6.5 billion.