Trump Administration Suspends $60 Million for New York Medicaid Fraud Unit Over 53 Convictions
Updated
Updated · Fox News · Jul 2
Trump Administration Suspends $60 Million for New York Medicaid Fraud Unit Over 53 Convictions
3 articles · Updated · Fox News · Jul 2
Summary
HHS halted federal funding for New York’s Medicaid Fraud Control Unit on July 1 after denying its annual recertification, with the suspension set to last through Sept. 30 unless the state makes corrective changes.
A June 30 OIG letter said the unit became the worst-performing large-state office for criminal Medicaid fraud enforcement, logging just 53 convictions from 2023 to 2025 versus 129 for the next-lowest peer.
Federal officials said fewer than 10 indictments were filed in four of the past five years, 34% of open cases were older than three years, and 69% of referrals had sat pending for at least two years.
Letitia James called the move a political attack, citing more than $627 million recovered for Medicaid and New York’s outsized civil recoveries, while federal reviewers said that civil focus came at the expense of criminal prosecutions.
The freeze gives Republicans fresh ammunition against James’ reelection bid, and OIG warned New York could lose its fiscal 2027 grant entirely if it fails to cut backlogs, raise indictments and improve federal coordination.