US: Trump administration pauses Minnesota health funds

DW News · Feb 26, 2026 · Collected from RSS

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The Trump administration is suspending a part of Minnesota's Medicaid funding as it steps up pressure on the Midwestern US state over allegations of fraud involving social welfare funds. Vice President JD Vance announced the "temporary halt" on Wednesday, saying that the action was being taken "in order to ensure that the state of Minnesota takes its obligations seriously to be good stewards of the American people's tax money." Mehmet Oz, the administrator for the Centers for Medicare and Medicaid Services, said that $259 million (€219 million) would not be paid out for now to Minnesota in federal funding for Medicaid, which is a crucial safety net program for low income Americans. Trump's new 'war on fraud' The move follows a massive immigration crackdown in Minneapolis — the state's most populous city — over allegations of fraud involving day care centers run by Somali residents. The scandal prompted the Trump administration to deploy a surge of immigration agents in Minnesota. The controversial crackdown was received with widespread protests and led to two US citizens being fatally shot. Minnesota residents push back against ICE immigration raidsTo view this video please enable JavaScript, and consider upgrading to a web browser that supports HTML5 video Wednesday's announcement comes a day after US President Donald Trump, in his State of the Union address, said that Vance would be tasked with leading a national "war on fraud." The Republican vice president described allegations of inadequate oversight as a misuse of public funds. He accused the Democratic-led state of failing to cooperate sufficiently with the federal probe. Minnesota Governor Tim Walz said that the Trump administration's funding freeze had nothing to do with fraud, deeming it a "campaign of retribution." "Trump is weaponizing the entirety of the federal government to punish blue states like Minnesota. These cuts will be devastating for veterans, families with young kids, folks with disabilities, and working people across our state," he wrote on social media platform X. Official estimates show that around 1.3 million people in Minnesota rely on Medicaid and 40% of the program's beneficiaries are children. Edited by: Dmytro Hubenko