Trump administration suspends $250 million in Minnesota Medicaid funding

The Trump administration announced it will temporarily suspend over $250 million in Medicaid reimbursements to the state of Minnesota under a new anti-fraud initiative. The federal government said the pause will remain until Minnesota strengthens efforts to prevent fraud targeting U.S. taxpayers.

Federal officials defend suspension

At a press briefing alongside Mehmet Oz, head of Medicare and Medicaid, federal official Vance stated, “We are stopping the federal payments that will go to the state government until the state government takes its obligations seriously to stop the fraud that’s being perpetrated against the American taxpayer,” as reported by The Washington Post.

State criticizes move as political

Minnesota Governor Tim Walz sharply criticized the suspension, calling it “a campaign of retribution” and alleging the Trump administration is punishing Democratic-led states. Critics argue the policy unfairly targets “blue” states while favoring Republican-led “red” states. Walz also noted that ongoing actions by federal agents and recent pardons for fraudsters undermine the state’s ability to combat financial crimes.

Impact on residents

Minnesota’s Medicaid and MinnesotaCare programs together serve nearly 1.3 million residents, about one in four in the state. Walz warned that the suspension could have severe consequences for veterans, families with young children, people with disabilities, and low-income working households. Nationwide, Medicaid covers over 70 million Americans, including children, pregnant women, seniors, and individuals with disabilities.