The Trump administration has temporarily frozen $259 million in federal Medicaid funding to Minnesota amid a reported fraud scandal in social welfare programs. Vice President JD Vance announced the action, pointing to inadequate controls and a lack of cooperation from state authorities. President Trump accuses members of the Somali community of embezzling an estimated $19 billion, though media and the governor cite lower amounts.
At the heart of the dispute is a fraud scandal involving social welfare benefits in the Democratic-led state of Minnesota. The US government is intensifying pressure by temporarily freezing part of the federal contributions to the Medicaid program for low-income individuals. Republican Vice President JD Vance justified the step with inadequate controls and a "systematic misuse" of taxpayer funds. He also criticized the limited willingness of local authorities to cooperate in the investigation.
The evening before, President Donald Trump had tasked Vance with probing the case. According to Trump, members of the Somali community have embezzled "an estimated $19 billion." However, US media like the "New York Times" report fraud amounting to several hundred million dollars. Minnesota's Democratic Governor Tim Walz cited damages of $250 million for part of the affected programs.
Mehmet Oz, head of the state health systems Medicare and Medicaid, confirmed the frozen amount of $259 million. Medicaid costs are shared between the federal government and states. In Minnesota, about 1.3 million people rely on the program, including over 40 percent children. It supports pregnant women, the disabled, and the elderly. Unlike in Germany, the US lacks universal health insurance.
The measure aims to combat the fraud, though the sources provide no further details on impacts to recipients.
