'Despicable': Vance, Oz Announce Freeze on Some Medicaid Funding for Minnesota

US Vice President JD Vance said Wednesday that the Trump administration will pause some Medicaid funding for Minnesota over fraud concerns—without offering any guarantees that the suspension will not adversely impact the more than 1 million Minnesotans who depend upon the key healthcare program.

"We're announcing today that we have decided to temporarily halt certain amounts of Medicaid funding that is going to the state of Minnesota in order to ensure that the state of Minnesota takes its obligations seriously to be good stewards of the American people's tax money," Vance said at a White House press conference with Centers for Medicare and Medicaid Services (CMS) Administrator Mehmet Oz.

"Now what is this gonna mean?" Vance continued. "What this means is that, first of all, the providers on the ground in Minnesota have actually already been paid... What we're doing is we are stopping the federal payments that will go to the state government until the state government takes it obligations seriously to stop the fraud that's being perpetrated."

Oz demanded that Democratic Minnesota Gov. Tim Walz determine "who these providers are; make sure they're not already in trouble for doing bad stuff, and then reevaluate all the current providers to make sure they're supposed to be able to provide these services."

Responding to Oz's remarks, Gaia Leadership Project founder Elizabeth Cronise McLaughlin said on Bluesky, "So Minnesota is supposed to review every appointment by a Medicaid recipient with every doctor to get funds already lawfully allocated to the state?"

Asked by a reporter how he intends to ensure that the funding pause "doesn't impact the people who are enrolled in Medicaid," Vance said he is "worried about the justice of it all."

"I think it's offensive that American taxpayers pay into these programs and they're defrauded... and it's really sad that American children who need these services are unable to get them, because they're going to fraudsters," Vance replied.

"Look, we're certainly gonna make sure that our anti-fraud efforts go after the fraudsters and not after anybody who actually benefits from these services," he continued. "But I actually think the question is a little off, in a way, because the problem is not going after the fraud, the problem is that these programs are being defrauded to begin with."

"Our social safety net will disappear unless we take fraud more seriously," added the vice president, whose boss, President Donald Trump, last year signed into law the biggest cuts to Medicaid and the Supplemental Nutrition Assistance Program, or SNAP, in the nation's history as part of the One Big Beautiful Bill Act.

Medicaid is the primary healthcare safety net for lower-income Americans, with nearly 70 million people enrolled nationwide at the end of last year.

While federal prosecutors are investigating Minnesota’s Medicaid system—specifically, 14 high-risk service programs such as housing support and personal-care services—on suspicion of billions of dollars in fraudulent billings since 2018, and dozens of people have been convicted of stealing public money through the state’s social services system, critics noted that Congress, not the president, has the power of the purse.

Some observers noted that Trump has already targeted Minnesota—which voted against him all three times he ran for president—with his deadly crackdown on undocumented immigrants and their defenders and racist attacks on Somali immigrants, including Congresswoman Ilhan Omar (D-Minn.).

The Medicaid freeze follows the Trump administration's $10 billion cut in federal childcare funding to five Democrat-led states, including Minnesota, last month—a move that opponents argue punishes working families who committed no fraud.

University of Illinois professor Nicholas Grossman called the Medicaid pause "taxation without representation."

"The Constitution clearly gives Congress the power to spend taxpayer funds, and no law allows the president to halt if he feels some US states aren’t being 'good stewards' of the money," he said on Bluesky. "In case there’s any confusion on this, the Impoundment Control Act forbids it."

"The people of Minnesota vote for representatives to Congress," Grossman added. "Minnesota representatives and senators were in DC, representing their constituents, when Congress passed laws using proper procedure that allocated Medicaid funding. The president breaking those laws violates the fundamental compact of the republic."

Oz on Wednesday also announced "a six-month national moratorium blocking all new enrollments for durable medical equipment—prosthesis, orthotics—supplies across the board" in the name of fighting fraud. The move targets suppliers, not individual Medicaid beneficiaries.

This from Oz, a promoter of privatized Medicare Advantage programs, which are notorious for overcharging taxpayers and denying patients necessary care. The CMS under Oz increased federal funding for Medicare Advantage plans by more than $25 billion for 2026.

As Common Dreams recently reported, United Health Group (UHG), one of the country's largest for-profit health insurance companies, has been the leading beneficiary of a long-running Medicare Advantage fraud scheme that the Medicare Payment Advisory Commission—an independent, nonpartisan legislative branch agency—warned could cost US taxpayers $1.2 trillion over the next decade.

Some critics said that if Trump really cared about fraud, he'd go after companies like UHG—and stop pardoning so many convicted criminals who committed billions of dollars worth of fraud.

"These guys are despicable," Michigan State University professor Brendan Cantwell said Wednesday in response to Vance and Oz's announcement.

Robert Weissman, co-president of the consumer advocacy group Public Citizen, said in a statement Wednesday that “Medicaid fraud is a serious problem that requires cracking down on fraudsters—not patients."

Weissman continued:

This administration’s anti-fraud rhetoric is itself a fraud. In fact, the administration has gutted anti-fraud government agencies and programs and let fraudsters off the hook. It has issued record-breaking pardons to fraudsters; sought to eliminate the most important anti-consumer fraud agency, the Consumer Financial Protection Bureau; eviscerated the corps of inspectors general whose job is to root out waste, fraud, and abuses; and dropped dozens of fraud and fraud-related investigations against large corporations.

“The Trump administration suspension of Medicaid funding in Minnesota is a bad-faith, punitive, and shameful measure that will punish people in Minnesota as part of the same deceptive story that the Trump administration has told to justify the outrageous [Immigration and Customs Enforcement] invasion of the state," Weissman added.