SerpApi.Org
The U.S. Department of Health and Human Services (HHS) and the Centers for Medicare & Medicaid Services (CMS) deferred more than $1 billion in federal Medicaid payments to California and Minnesota as part of the Trump administration's effort to combat fraud, waste and abuse and safeguard taxpayer dollars.
CMS is deferring approximately $867.5M in federal Medicaid payments to California and $199M to Minnesota after financial reviews identified claims requiring additional scrutiny before federal matching funds are released. The payments are not being permanently withheld, and both states will have the opportunity to submit documentation demonstrating the claims comply with federal Medicaid requirements.
Minnesota Governor Tim Walz said the move was political retribution against the state, arguing the administration was "punishing children, seniors and people with disabilities rather than fraudsters" and "is cutting more money in healthcare than they've prosecuted for fraud," Reuters reported.
California Governor Gavin Newsom called the move a recycled political stunt and said in a post on X that California was being targeted for political reasons. He said the state opposes fraud and would "collaborate with CMS in good faith efforts to combat fraud," arguing its in-home program saves money by keeping seniors and disabled people out of costlier nursing homes.
In February, the Trump administration took several steps to crack down on Medicare and Medicaid fraud, including deferring almost $260 million of quarterly federal Medicaid funding in Minnesota while the feds completed a fraud investigation.
HHS is also expanding exclusion authority, letting HHS's inspector general permanently bar bad actors from federal health programs.
Medicaid stocks: UnitedHealth Group (UNH), Centene (CNC), Elevance (ELV) and Molina Healthcare (MOH)
