Centers for Medicare and Medicaid Services (CMS) Administrator Dr. Mehmet Oz stated that Medicaid fraud has become a "feature" in some Democrat-led states, allowing them to exploit the federal program for economic and political benefit. Oz urged California Governor Gavin Newsom and other Democratic governors to join the current administration's anti-fraud initiatives.
In an interview with Fox News Digital, Oz explained his view that certain states are using Medicaid-funded care programs as an economic driver. He alleged that federal reimbursements are distributed to pay unemployed individuals, which he described as "Medicaid-ing it." Oz further contended that this arrangement generates political incentives, as these newly employed workers can unionize. He claims these unions then contribute union dues, which can fund political action committees, primarily benefiting one party in local and state elections.
Oz specifically criticized Governor Newsom, asserting that California has not adequately addressed widespread fraud within the state despite receiving internal warnings. "I think Governor Newsom's embarrassed," Oz said, adding that while the state has taken "performative steps," they have not implemented the necessary measures to halt fraud.
In response to California's perceived inaction, the Trump administration reportedly cut over $1.3 billion in the state's Medicaid reimbursements. Oz emphasized the federal government's responsibility to ensure taxpayer money is spent appropriately, stating, "We can't understand where the money's going."
Oz encouraged all governors to align with the Trump administration's efforts to combat fraud nationwide. He highlighted the role of Vice President JD Vance in spearheading a new anti-fraud task force aimed at federal oversight of benefit program exploitation. "The greatest obstacle is when the governors don't realize that if they're not aligned with the president, if they're not on the same page, then they're pulling the oars in the opposite direction and we're going in a circle down the drain," Oz commented. "Fraud happens because the people who have the power to stop it don't work together."