Trump Administration Halts $259M in Minnesota Medicaid Funding Over Fraud Claims
Trump Administration Halts $259 Million in Medicaid Funding to Minnesota Amid Fraud Concerns
The Trump administration is temporarily halting $259 million in Medicaid funding to Minnesota, Vice President JD Vance announced Wednesday, citing concerns over alleged fraud within the state’s Medicaid system.
Vance stated the payments will be paused “until the state government takes its obligations seriously to stop the fraud that’s being perpetrated against the American taxpayer.” The move comes as part of what the administration describes as an aggressive effort to combat misuse of public funds.
The decision follows a series of actions targeting Minnesota’s social services programs. In December, federal officials froze $185 million in child care funds to the state. Last month, the administration announced a freeze of $10 billion in funding for social services programs across five Democratic-led states, including Minnesota.
The latest action was previewed by President Donald Trump during his , where he vowed to wage a “war on fraud” and tasked Vance with leading the effort.
Dr. Mehmet Oz, administrator for the Centers for Medicare & Medicaid Services, said Wednesday that officials had identified “scammers” who he claimed had exploited a portion of the Minnesota Medicaid system. He did not provide specific details on the nature of the alleged fraud.
Federal prosecutors have confirmed large-scale social services fraud in Minnesota, with dozens of individuals – many of whom are Somali – having been convicted of stealing over $1 billion in public funds intended for food, housing, and services for people with disabilities. However, the administration did not offer detailed evidence Wednesday regarding the alleged large-scale Medicaid fraud in Minnesota that Oz referenced.
Oz stated that one provider reportedly submitted claims for working more than 24 hours a day for 450 days, but did not provide supporting documentation. Vance also mentioned a program that he said falsely claimed to offer after-school services to autistic children, again without providing identifying information.
According to the health policy research organization KFF, Medicaid covers nearly 1.2 million children and adults in Minnesota, with more than half being nursing home residents. Over three-quarters of Medicaid enrollees in the state are employed full-time, KFF data shows.
Oz indicated the federal government would only release the withheld funds once Minnesota submits a “comprehensive corrective action plan” to address the alleged issues. He gave Governor Tim Walz, D-Minn., 60 days to present such a plan. Oz also suggested similar announcements targeting other states – specifically mentioning Florida, New York, and California – are forthcoming.