The United States federal government will temporarily halt some of the medicaid payments to the state of Minnesota, US Vice President JD Vance announced at a joint press conference with Dr Mehmet Oz, the Administrator for the Centers for Medicare and Medicaid Services, on Wednesday, 25 February in Washington, DC.
President Trump spoke about the issue of fraud in Minnesota in his State of the Union address in front of Congress the day before. In the speech, the President also shared that Vice President Vance will be in charge of leading the new ‘War on Fraud’ initiative of his administration. The very next day, Vice President Vance informed the public of the first steps taken.
At the press conference with Dr Oz, he declared: ‘Way too many Americans are being defrauded by very bad actors in our society.’ He also informed all that contractors providing health care services in Minnesota had already been paid by the local state government, but federal Medicaid funds that would have reimbursed the state will not resume until the local administration can prove that it can be ‘good stewards’ of the American taxpayers’ money.
He specifically pointed out a string of fraudulent autistic children’s care services in the state, which ‘has made a number of people rich,’ by billing for fake—either not actually autistic or completely fictitious—patients.
‘One of the things that I love about our country is that we’re a generous country, we’re a generous people. We take care of our fellow citizens who can’t afford medical care because they’re down on their luck…What’s happening in Minneapolis, California, and a number of states all across our country is that the generosity and the good hearts of our fellow Americans are taken advantage of,’ Vice President Vance stated at the press conference. Dr Oz later specified that the exact amount the federal government will withhold from Minnesota in Medicaid payments is $259.5 million.
‘This is not a problem with the people of Minnesota, it is a problem with the leadership of Minnesota and other states who do not take Medicaid preservation seriously,’ the doctor told the press.
All this is taking place in the wake of the Somali daycare centre fraud scandal, uncovered by influencer Nick Shirley in January 2026.
Shirley visited the locations listed for daycare centres that had received state funds. Many of the locations had no personnel present to answer his on-site inquiry, even during typical business hours. Where he was met with workers, he still did not see any children being taken care of at the facilities. The vast majority of these fraudulent facilities were run by Somali immigrants.
As a result of the major scandal breaking, Governor Tim Walz, Vice Presidential candidate for the Democratic Party in the 2024 election, has announced that he would not be seeking re-election in the 2026 Minnesota gubernatorial election.
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