Vance says Trump administration pausing some Medicaid funding to Minnesota over fraud concerns

Vice President JD Vance arrives before President Donald Trump delivers the State of the Union address to a joint session of Congress in the House chamber at the U.S. Capitol in Washington, Tuesday, Feb. 24, 2026.

WASHINGTON — Vice President JD Vance announced Wednesday that the Trump administration would “temporarily halt” some Medicaid funding to the state of Minnesota over fraud concerns, as part of what he described as an aggressive crackdown on misuse of public funds.

Vance, who made the announcement with Dr. Mehmet Oz, the administrator for the Centers for Medicare and Medicaid Services, said the administration was taking the action “in order to ensure that the state of Minnesota takes its obligations seriously to be good stewards of the American people’s tax money.”

Wednesday’s move is part of a larger Trump administration effort to spotlight fraud around the country.

That effort comes after allegations of fraud involving day care centers run by Somali residents in Minneapolis prompted a massive immigration crackdown in the Midwestern city, resulting in widespread protests. President Donald Trump, in his State of the Union address on Tuesday, announced Vance would spearhead a national “war on fraud.”

Oz, who referred to people committing fraud as “self-serving scoundrels,” said the federal government would hold off on paying $259 million to Minnesota in funding for Medicaid, the health care safety net for low-income Americans.

“This is not a problem with the people of Minnesota, it’s a problem with the leadership of Minnesota and other states who do not take Medicaid preservation seriously,” he said

Oz said the administration was notifying Minnesota’s Democratic Gov. Tim Walz as he was making the announcement publicly. Messages sent to Walz’s spokespeople were not immediately returned.

The latest action was prompted in part by a series of fraud cases, including a nonprofit called Feeding Our Future accused of stealing pandemic aid meant for school meals. Prosecutors have put the losses from that case at $300 million.

Since then, Trump has targeted the Somalian diaspora in Minnesota with immigration enforcement actions and has made a series of disparaging comments about the community. During his State of the Union address on Tuesday, Trump said “pirates” have “ransacked Minnesota.”

Federal agencies have also been enlisted to assist in targeting fraud in Minnesota.

Last December, the U.S. Treasury Department issued an order requiring money wire services that people use to send money to Somalia to submit additional verification to the Treasury.

The Center for Medicare and Medicaid Services told Minnesota in January that it intended to freeze parts of payments for some Medicaid programs that were deemed high-risk. The state said that those cuts would add up to more than $2 billion annually if they lasted and made an administrative appeal.

Vance said in an interview on Fox News Channel earlier Wednesday that the Justice Department and Treasury Department would also be involved in the effort, and would be looking at tax records to uncover fraud.

“There’s a whole host of tools that we have never used,” Vance said."

Michelle L. Price And Ali Swenson, The Associated Press