In the latest salvo in the war between the Trump administration and California, Health and Human Services Secretary Robert F. Kennedy Jr. said Tuesday that his agency withheld $867.5 million in Medicaid payments to the state over concerns about fraud.
Kennedy also said his agency deferred $199 million in Medicaid payments to Minnesota over similar concerns.
“If Governor Gavin Newsom or Governor Tim Walz want these funds released, all they have to do is provide basic documentation showing that these services are legitimate and not fraudulent,” Kennedy said at a news conference.
Just under half of California's withheld funds were related to home health services.
Dr. Mehmet Oz, administrator of the Centers for Medicare and Medicaid Services, said California's spending on home health services increased more than twice the national average over the past two fiscal years.
“That doesn't make sense,” he said.
About a quarter of the withheld funds involved care provided to people with “unsatisfactory immigration status,” whose eligibility to be in the country and receive these services is in question, which Oz characterized as a “massive and ongoing problem for California.”
Kennedy and Oz's announcement Tuesday comes two months after Vice President JD Vance announced that the administration would defer $1.3 billion in Medicaid payments over fraud concerns, largely related to hospice and home health care services.
Newsom's office, in a social media post, called the ad a “recycled political stunt.”
“California is not being attacked because Trump has evidence of fraud,” the post said. “We are being attacked for political reasons and because Dr. Oz doesn't understand that we are *SAVING* taxpayers money by keeping seniors and people with disabilities out of much more expensive nursing homes!”
Newsom's office also said the state is “ready to collaborate” with the Centers for Medicare and Medicaid Services “on good faith efforts to combat fraud.”
The California Lawyer's Office. Gen. Rob Bonta said he is reviewing the deferral of payments and allegations of fraud.
“We have not hesitated to challenge the Trump administration's unlawful actions and will continue to act whenever Californians' rights or access to critical services are threatened,” Bonta's office said.
Despite Newsom's claims that the allegations are political, California's state auditor has repeatedly flagged discrepancies in Medi-Cal eligibility that have exposed the state to billions of dollars in questionable payments.
Newsom and Oz have clashed before.
Newsom filed a civil rights complaint in January against Oz, after Oz posted a video on social media from Van Nuys accusing the “Russian Armenian Mafia” of being a major driver of $3.5 billion in hospice and home care fraud.
Newsom said Oz's claims were “baseless and racist.”
Kennedy and Oz's announcement Tuesday is the latest effort by the Trump administration to crack down on alleged Medicaid fraud in numerous states across the country.
