NEW YORK — President Donald Trump’s administration is expanding its crackdown on state Medicaid programs to include New York, launching a fraud investigation in the state a week after announcing it had frozen nearly $260 million in Medicaid funding in Minnesota over similar accusations.
The Trump administration has identified troubling trends in New York’s Medicaid program and demanded state officials provide details about their handling of fraud, waste and abuse within 30 days or risk delayed payments, Centers for Medicare & Medicaid Services Director Dr. Mehmet Oz announced Tuesday.
“Cardiac surgeons are trained to look at numbers,” Oz, the former famous heart surgeon, said in a video on Tuesday. “Right now, the numbers from New York’s Medicaid program don’t add up.”
The new investigation is part of an administration-wide initiative to address fraud across the country, which federal officials say is necessary to rein in runaway spending and protect taxpayers. With many midterm voters concerned about affordability, Trump ramped up those efforts, announcing that Vice President J.D. Vance would help balance the nation’s budget by leading the “War on Fraud” at the national level.
The Democratic state officials targeted have denounced the Republican administration’s moves as politically motivated and potentially disastrous for millions of people who depend on the health care safety net of low-income Americans.
In a letter to New York Gov. Kathy Hochul, a Democrat, Oz wrote that the state’s spending levels coupled with “serious concerns” about its oversight of some Medicaid services require “immediate investigation, corrective action, and enhanced transparency.”
The letter cited specific areas of concern, including a high percentage of Medicaid beneficiaries in New York who receive personal care services related to activities of daily living such as bathing, grooming, and meal preparation.
New York’s high Medicaid costs have long puzzled state governors and were a top priority for Gov. Andrew Cuomo, a Democrat who has struggled for years with the program’s prices rising as residents age and take on additional benefits. The state program, which cost $115.6 billion in fiscal year 2025, provides health care to about 1 in 3 New Yorkers and spends more per person on care than Medicaid programs in any other state.
Hochul has also tried to rein in costs by overhauling how the home health care program is run.
When reporters asked Wednesday about Oz’s letter, Hochul said the Trump administration was targeting a Democratic-led state for political reasons, but added: “I’m going to have to stand up and show them the truth and show them the facts, that they’re wrong. When there’s fraud, I’m going to help them fight it.”
Hochul’s office said the fraud investigation was an attempt by the Trump administration to take health care away from ordinary New Yorkers.
The New York investigation comes less than a week after CMS halted Medicaid payments to Minnesota over fraud concerns. Oz said the money will not be delivered until Minnesota implements a “comprehensive corrective action plan.”
The administration had previously cited fraud allegations related to day care centers run by Somali residents in the Minneapolis area as a reason for increased federal law enforcement there. Minnesota Governor Tim Walz, a Democrat, called the freeze on new funding “targeted retaliation.”
Minnesota on Monday filed a lawsuit against the Trump administration over the deferred payments. The state is also appealing CMS withholding $2 billion in annual Medicaid funds announced in early January.
The Trump administration has sought to withhold funding from Democratic-led states at least twice more in recent months over fraud concerns. This has happened with child care subsidies and other social services programs in Minnesota, New York and three other states, and with the Supplemental Nutrition Assistance Program in 22 states that have refused to hand over data the federal government says is needed to uncover fraud.
Either way, the judges ruled that the money should keep flowing for the time being.
Associated Press writer Jeff Mulvihill in Philadelphia contributed to this report.
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