Trump administration widens its anti-fraud efforts with a Medicaid probe in New York

NEW YORK (AP) — President Donald Trump's administration is expanding its crackdown on state Medicaid programs to New York, launching a fraud probe in the state a week after it said it was freezing nearly $260 million in Medicaid funding in Minnesota over similar accusations.

Centers for Medicare and Medicaid Services Administrator Dr. Mehmet Oz announced Tuesday that the Trump administration identified concerning trends in New York’s Medicaid program and demanded that state officials provide details about their handling of fraud, waste and abuse within 30 days or risk deferred payments.

“Heart surgeons are trained to look at the numbers,” Oz, a former celebrity heart surgeon, said in a video on Tuesday. “Right now, the numbers coming out of New York’s Medicaid program don’t add up.”

The new investigation is part of an administration-wide initiative to address fraud around the country, which federal officials say is needed to rein in runaway spending and protect taxpayers. With many midterm voters concerned about affordability, Trump has ramped up those efforts, announcing that Vice President JD Vance would help balance the nation’s budget by spearheading a national “war on fraud.”

Targeted Democratic state officials have decried the Republican administration's moves as politically motivated and potentially disastrous for the millions of people who rely on the health care safety net for low-income Americans.

New York's Democratic governor says the move is politically targeted

In a letter to New York Gov. Kathy Hochul, a Democrat, Oz wrote that the state's spending levels combined with “serious concerns” about its oversight of certain Medicaid services demand “immediate investigation, corrective action and enhanced transparency.”

The letter flagged specific areas of concern, including a high proportion of New York's Medicaid beneficiaries receiving personal care services related to daily living activities like bathing, grooming and meal preparation.

New York’s soaring Medicaid costs have long vexed the state’s governors and were a top priority of Gov. Andrew Cuomo, a Democrat who grappled for years with the program's spiraling price tag as residents age and receive additional benefits. The state's program, which cost $115.6 billion in the 2025 fiscal year, provides health care for about 1 in 3 New Yorkers and spends more per person for care than Medicaid programs in any other state.

Hochul has also tried to rein in costs through an overhaul of how a home health care program is administered.

Asked Wednesday by reporters about Oz’s letter, Hochul said the Trump administration is targeting a Democrat-led state for political reasons but added, “I will have to stand up and show them the truth and show them the facts, that they’re wrong. When there is fraud I will help them fight it.”

Hochul's office said the fraud investigation was an attempt by the Trump administration to rip health care away from everyday New Yorkers.

New York investigation follows a federal crackdown in Minnesota

The New York investigation comes less than a week after CMS halted Medicaid payments to Minnesota over fraud concerns. Oz said the money would be delivered only after Minnesota implements “a comprehensive corrective action plan."

The administration had previously cited allegations of fraud involving day care centers run by Minneapolis-area Somali residents as a reason for a massive federal enforcement surge there. Minnesota Gov. Tim Walz, a Democrat, called the new funding freeze “targeted retribution.”

Minnesota on Monday sued 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 two other times in recent months citing fraud concerns. It 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 declined to hand over data that the federal government says is needed to catch fraud.

In both those cases, judges have ruled that the money must continue to flow for now.

Associated Press writer Geoff Mulvihill in Philadelphia contributed to this report.