Medicaid Is Being Cut by Budget and by Political Pressure. The People Who Will Pay Are the Sickest and Poorest Americans.

There is a version of the debate about Medicaid that treats it exclusively as a fiscal question — a line item in a federal budget that has grown too large and must be brought under control through a combination of eligibility restrictions, payment reductions, and fraud prevention. That framing is not entirely without merit; government officials have a legitimate obligation to be rigorous stewards of public funds, and fraud in public programs is real and must be addressed. But the fiscal framing becomes deeply misleading when it obscures what Medicaid actually is and who actually depends on it: a health insurance program for low-income Americans, the majority of whom carry the chronic diseases — diabetes, coronary artery disease, HIV, serious mental illness — that require the most intensive medical care and that, without treatment, generate the most preventable illness and death in the country.

Congress has already made large cuts to Medicaid through the most recent budget legislation, and public health experts have documented clearly that Medicaid enrollees are disproportionately likely to have exactly the health conditions that become catastrophically expensive and deadly without consistent treatment. Those cuts were consequential enough on their own. What has followed them, however, represents a different and in some ways more troubling category of action: the use of fraud allegations as a mechanism for suspending payments to specific states, in ways that bear the unmistakable marks of political targeting rather than rigorous fiscal accountability.

Minnesota, New York, and the Pattern of Politically Targeted Suspensions

In Minnesota, the Trump administration froze $259 million in Medicaid payments, citing previous instances of fraud in state social services programs — fraud that is real, that resulted in the conviction of dozens of people, and that no one serious is defending. The critical distinction is between punishing those who committed that fraud, which is appropriate, and withholding essential medical services from Minnesotans who depend on Medicaid for their care, which is something else entirely. Vice President JD Vance’s characterization of the freeze as an effort to “turn the screws on [Minnesota] a little bit” removes any ambiguity about the intended purpose. Minnesota’s attorney general, Keith Ellison, has sued to restore the funds, describing the action as having “weaponized Medicaid against Minnesota as political punishment,” and Governor Tim Walz has called it “targeted retribution.”

New York appears to be next. Centers for Medicare & Medicaid Services Administrator Dr. Mehmet Oz sent Governor Kathy Hochul a letter demanding information within 30 days or risk deferred payments, citing what he described as a “high proportion” of beneficiaries receiving personal care services including bathing, grooming, and meal preparation. New York’s Medicaid program covers roughly one in three New Yorkers at a total cost of $115.6 billion in fiscal year 2025, making it the most expensive per-enrollee program in the country. What Oz’s letter does not acknowledge is that the underlying Medicaid data present substantial analytical challenges: the dataset excludes hospital spending, lacks procedure and diagnosis codes, and uses billing codes in which a single entry can represent anywhere from 15 minutes to a full day of care. Drawing conclusions about fraud from data with those structural limitations requires far more analytical care than a demand letter allows.

The Standard That Should Govern Medicaid Suspensions

I began working for the Centers for Disease Control and Prevention in 2001, and one of the first things my supervisors impressed upon me was the responsibility that comes with managing public funds. That lesson stayed with me across every subsequent role in government, and I take seriously the obligation of public agencies to minimize waste and fraud. Fraud exists in all sectors, public and private, and public programs must always balance their legitimate interest in minimizing it against the real and immediate harms that flow from suspending funding.

For programs that people’s lives literally depend on, the bar for a complete suspension should be extraordinarily high — the evidence incontrovertible, the documented fraud both systemic and ongoing, the scope of the problem clearly disproportionate to the harm that suspension would cause. Medicaid, by any honest accounting, clears none of those thresholds in Minnesota or New York on the basis of the evidence currently cited. The consequence of applying a lower standard is measured in the health of people with diabetes who lose coverage for insulin, people with HIV who lose access to antiretroviral therapy, and people with serious mental illness who lose access to medication and care management. Those consequences arrive faster than any investigation concludes, and they are not reversed when the investigation ultimately finds less fraud than the initial allegations suggested.

The evidence is clear that cutting Medicaid leads to more sickness and death. How we get policy to align with that evidence, in a political environment where the framing of fiscal responsibility is being used to justify actions with deeply inequitable human consequences, is among the most urgent challenges facing public health today.