Vice President JD Vance and Dr. Mehmet Oz, the administrator for the Centers for Medicare and Medicaid Services (CMS), announced on Wednesday that the administration would “temporarily halt” $259.5 million in Medicaid funding to Minnesota amid a crackdown on public funds misuse.
Dr. Oz said CMS would suspend new Medicare enrollments for six months for suppliers of durable medical equipment, prosthetics, orthotics, and related medical supplies. Oz also unveiled a crowdsourcing initiative aimed at fighting fraud by inviting tips and suggestions from the public.
He said the funding would be restored once Minnesota submits and carries out a comprehensive corrective action plan. Governor Tim Walz has 60 days to respond.
“This is not a problem with the people of Minnesota, it’s a problem with the leadership of Minnesota and other states who do not take Medicaid preservation seriously,” stated Oz.
Notably, in January, the CMS had informed Minnesota that it planned to freeze portions of funding for certain high-risk Medicaid programs. The state said the cuts could total more than $2 billion a year if sustained and has filed an administrative appeal.
Walz responded to the Vance-Oz announcement with a post on X saying, “This has nothing to do with fraud,” adding, “Every week Trump pardons another fraudster.”
In another post, the Governor called it “a campaign of retribution.” He said the cuts would be “devastating” for people of his state, particularly veterans and people with disabilities.
Trump’s Crackdown On Minnesota
President Donald Trump declared a national “war on fraud” in his State of the Union address on Tuesday, with Vance spearheading the campaign. Colin McDonald has also been nominated as the inaugural assistant attorney general to head a newly created Justice Department division dedicated to combating fraud.
Trump turned his focus to Minnesota amid allegations of fraud tied to day care centers run by Somali residents in Minneapolis. This triggered a sweeping immigration crackdown in the city, sparking widespread protests.
Meanwhile, Feeding Our Future, an NGO in Minnesota, has been accused of misappropriating pandemic relief funds intended for school meal programs, with prosecutors estimating losses at $300 million.
States Sue Trump Administration Over Cuts
The Trump administration, over the past few months, has faced legal action over funding cuts. Earlier this year, five Democrat-led states, including Minnesota, sued the administration for freezing $10 billion in federal childcare and family assistance funds.
Moreover, four Democratic-led states, including Minnesota, filed a federal lawsuit in Chicago to block the Trump administration’s $600 million healthcare funding cuts. These states argued that the reductions were unlawful and politically motivated.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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