Oz Warns More States May See Federal Dollars Denied Over Fraud

Mehmet Oz, administrator of the Centers for Medicare & Medicaid Services, warned Thursday states not cooperating with the agency’s fraud investigations could lose federal funding as the agency eyes an expansion of its probes.

In an exclusive interview with Bloomberg Government at the Conservative Political Action Committee in Grapevine, Texas, Oz said CMS will soon expand beyond the handful of states they’re investigating for Medicaid fraud. Oz is leading probes in New York, Florida, Minnesota, Maine, and California.

The administration’s interest in investigating fraud sparked amid allegations of widespread abuse in Minnesota late last year. Prosecutors estimated there was potentially $9 billion worth of fraud across 14 Medicaid services in the state. House Republicans have also held several hearings on Capitol Hill related to CMS’ probes into fraud.

“We are using these tools we believe are in our right to protect taxpayer dollars and to ensure states pay attention to issues we are hoping they would want to deal with anyway,” Oz said in the interview. “If you have a major issue with figuring out that the providers are really doing what they say they’re doing and you have massive fraud you believe is existing, then you should want to address this anyway and if it’s not on your radar, we want to put it there.”

The administration isn’t just targeting blue states for federal oversight. Oz’s comments come roughly a week after CMS sent a letter to Florida Gov. Ron DeSantis questioning how the state has handled its Medicaid fraud.

Vice President JD Vance is set to hold the first meeting of the president’s task force to eliminate fraud at the White House on Friday.

Oz has said the probes are not meant to be “punitive,” but also cited how they have already sought to withhold nearly $260 million from Minnesota for Medicaid, which is the only state so far that has been subjected to frozen funding. CMS approved Minnesota’s “corrective action plan” to fix rampant fraud last week, which is supposed to halt the administration’s funding block.

Oz said it has been challenging to get transparent data from states.

“Minnesota has been a challenge and California is proving to be concerning but we’re still evaluating a fair amount of data,” Oz said.