Dr. Oz warns Walz to address alleged Somali Medicaid fraud or lose federal funding: ‘We’ll stop paying’
In a dramatic escalation of tensions surrounding Medicaid funding in Minnesota, Centers for Medicare & Medicaid Services (CMS) Administrator Mehmet Oz issued a stern warning to Governor Tim Walz on Friday, asserting that the state could face the loss of federal Medicaid funding unless it takes urgent action to restore the program’s integrity. The warning comes in the wake of alarming allegations that over $1 billion has been siphoned off through a widespread Medicaid fraud scheme linked to “bad actors” within Minnesota’s Somali community. Dr. Oz claimed that some of the misappropriated funds may have even been funneled to the terrorist organization al-Shabab, raising serious concerns about the implications of this fraud. In a post on X, Oz emphasized the unprecedented nature of this situation, stating that CMS officials had never encountered anything of this magnitude in the Medicaid system.
Oz’s accusations were underscored by shocking statistics regarding two specific Minnesota Medicaid programs. The Housing Stabilization Services program, which was initially projected to cost $2.6 million annually, shockingly paid out over $100 million in 2024 alone. Similarly, the Early Intensive Developmental and Behavioral Intervention program skyrocketed from $3 million in 2018 to nearly $400 million in 2023. These staggering increases have prompted Oz to demand immediate corrective measures from Gov. Walz, giving the state a 60-day deadline to address the issues or risk losing federal funding. He criticized the state’s previous attempts to report the fraud to CMS, claiming they were ineffective, and highlighted that the situation had escalated to the point where CMS had to intervene by shutting down the most problematic programs and freezing provider enrollments.
The fallout from these allegations has not only put Governor Walz in the hot seat but has also attracted attention from national figures, including former President Donald Trump, who has characterized Minnesota as a “hub of money laundering activity.” Trump has initiated investigations into the alleged fraud, including a new Treasury Department probe into the diversion of taxpayer dollars to al-Shabab. The combination of local and national scrutiny puts immense pressure on Walz’s administration, as the governor has yet to publicly respond to Oz’s allegations. As the deadline approaches, the stakes are high for Minnesota’s Medicaid programs and the integrity of public funds, leaving many to wonder how the state will navigate this crisis and restore trust in its healthcare systems.
Centers for Medicare & Medicaid Services (CMS) Administrator Mehmet Oz on Friday warned Minnesota Gov.
Tim Walz
the state could lose federal Medicaid funding unless it restores “the integrity” of its program.
In a post on X, Dr. Oz claimed more than $1 billion had been stolen through a massive
Medicaid fraud scheme
carried out by “bad actors” within Minnesota’s Somali community, alleging some of the funds “may have even made its way to the Somalian terrorist group (al-Shabab).”
“Our staff at CMS told me they’ve never seen anything like this in Medicaid — and everyone from Gov. Tim Walz on down needs to be investigated, because they’ve been asleep at the wheel,” Oz said.
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Oz demanded Walz take the following corrective measures within 60 days:
“If we’re unsatisfied with the state’s plans or cooperation, we’ll stop paying the federal share of these programs,” Oz warned.
The CMS administrator pointed to two
Minnesota Medicaid programs
launched in recent years, noting dramatic spikes in costs.
The Housing Stabilization Services program, projected at $2.6 million annually, paid out over $100 million in 2024, according to Oz.
The Early Intensive Developmental and Behavioral Intervention program grew from $3 million in 2018 to nearly $400 million in 2023, he said.
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“These scammers used stolen taxpayer money to buy flashy cars, purchase overseas real estate and offer kickbacks to parents who enrolled their kids at fake autism treatment centers,” Oz said. “Some of it may have even made its way to the Somalian
terrorist group al-Shabab
. … So why didn’t Walz stop them? That’s simple: because he went all-in on identity politics.”
Minnesota officials previously reported the problem to CMS but failed to address it effectively, according to Oz.
“We stepped in and shut down the worst program: housing. We also froze provider enrollment in a few of the most abused programs,” Oz said.
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“The message to Walz is clear: either fix this in 60 days or start looking under your couch for spare change, because we’re done footing the bill for your incompetence.”
President
Donald Trump
recently announced a flurry of actions to crack down and investigate fraud schemes in Minnesota, which he has assailed as a “hub of money laundering activity,” and cited it as the basis of his decision to terminate deportation protections for hundreds of Somali migrants.
This week, senior Trump administration officials announced fresh investigations, including a new Treasury Department probe into how taxpayer dollars were allegedly diverted to the terrorist organization al-Shabab, according to Secretary Scott Bessent.
Walz’s office did not immediately respond to Fox News Digital’s request for comment.
Fox News Digital’s Breanne Deppisch contributed to this report.
