Robert F Kennedy Jr said the Trump administration has imposed a California Minnesota Medicaid funding freeze, pausing more than $1 billion for California and Minnesota on Tuesday. He said the states must prove the payments are legitimate before the money moves again.
The pause includes more than $867 million for California and about $200 million for Minnesota. Kennedy said the review used AI, advanced analytics, and other cutting-edge tools to identify suspicious activity and potential fraud.
California and Minnesota
Mehmet Oz said the government has identified potential areas at high risk of fraud. He also said states have not yet been able to document fully and acceptably to the federal government claims that are unresolved and claims that smell like fraud.
Oz said, "No más, no more. It stops." The Centers for Medicare & Medicaid Services is expanding its exclusion authority to remove bad actors from federal healthcare programs and permanently ban them from receiving federal funding.
JD Vance in March
The funding pause follows a $243 million pause in Medicaid payments to Minnesota earlier this year. In March, JD Vance threatened to withhold funding to states if they did not cooperate with a new fraud taskforce.
In March, Minnesota sued HHS for withholding Medicaid funds. Kennedy also said most of the suspected fraud in California was in in-home services, a category he described as a lifeline for disabled individuals and a program that can be abused.
HHS for
"If those states want that money, they need to provide documentation that these payments are legitimate," Kennedy said at a press conference on Tuesday. Minnesota now faces a federal demand for records tied to the payments, while the state has already challenged earlier withholding in court.
Mehmet Oz said, "states have not yet been able to document fully and acceptably to the federal government claims that are unresolved and claims that smell like fraud. And if it smells like fraud, we’re not paying for it any more." Which specific Medicaid claims or providers are being treated as suspicious in California and Minnesota is still the open question.
