The administration now says failure to report Covid-19 data to the Department of Health and Human Services could cost hospitals Medicare and Medicaid funding.
An inspector general’s audit said the Centers for Medicare and Medicaid Service used communications contractors for work that should have been performed by public servants.
If successful, the move would permanently end the health insurance program popularly known as Obamacare and wipe out coverage for as many as 23 million Americans.
White House chief of staff Mick Mulvaney wants to see if the Medicare chief Seema Verma and the health secretary, Alex M. Azar II, can still work together.
A federal judge said the president had vastly exceeded his legal authority in reducing payments to hospitals for drugs given to Medicare beneficiaries.