Trump administration freezes another $91 million in Minnesota Medicaid funds over fraud concerns
The Trump administration notified Minnesota on Thursday that it is deferring an additional $91 million in Medicaid funding, citing fresh evidence of fraud vulnerabilities in state-run social service programs, a move that pushes the total amount of frozen federal dollars past $300 million and deepens the standoff between Washington and the state Tim Walz governed until recently.
Centers for Medicare and Medicaid Services Administrator Dr. Mehmet Oz announced the deferral in a video statement, tying it directly to federal raids earlier in the week.
On Tuesday, federal agents searched childcare and learning centers and other sites in the Minneapolis-St. Paul area that receive federal Medicaid funding. Two days later, the freeze landed.
The new deferral sits on top of roughly $243 million that Vice President JD Vance told Walz in February was being temporarily withheld over the same category of concerns. CMS approved Minnesota's corrective action plan in March, yet none of that earlier money has been released. Now the bill has grown.
CMS wants documentation before it releases another dollar.
Oz framed the action as cooperative, not punitive:
"This isn't about punishment, it's about partnership and accountability. We're offering Minnesota the support they need to fix these problems. But at the same time, we cannot and will not pay claims that don't meet federal standards. So we're asking for additional documentation to verify these charges."
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