Kennedy Pauses $1B in Medicaid Payments to California, Minnesota
July 22, 2026by Margaret Lyon
WASHINGTON — The Trump administration is halting more than $1 billion in Medicaid from California and Minnesota
HHS and the Centers for Medicaid and Medicare Services are withholding $860 million from California and $200 million from Minnesota while they investigate what they say are fraudulent claims
This is a new phase in the Trump administration’s push to crush “waste, fraud and abuse” in federal funding by using the White House Anti-Fraud Task Force created by an executive order in March.
Kennedy claimed the use of analytical data and AI helped in the financial reviews to identify suspicious activity and fraud in Medicaid claims. However, there was little detail given about how these tactics were used to find fraud
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According to the announcement, the fraud in California and Minnesota stems from people taking advantage of in-home medical care programs or using claims that need additional documentation that wasn’t provided, among claims with billing or eligibility concerns.
“We have a duty to stop the payments, demand answers, and then follow the evidence wherever it leads,” Kennedy said
Kennedy also announced the expansion of CMS’s exclusion authority, or the federal authority to remove “bad actors” from health care programs
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