Trump officials hit California with ‘largest ever’ freeze on Medicaid funds

Key Points:

• The Trump administration is suspending $1.1 billion in Medicaid funding for California’s In-home Supportive Services (IHSS) program over alleged fraud concerns, potentially affecting around 900,000 seniors and people with disabilities who rely on home health care.
• CMS Administrator Dr. Mehmet Oz cited California’s rapidly growing home health spending—twice the rate of other states—as justification for the largest Medicaid deferral ever, demanding the state provide a convincing explanation before funds are released.
• California officials attribute the program’s growth to increased caseloads, higher wages for home health workers, and greater service hours, emphasizing strong fraud oversight measures including assessments and electronic timesheets.
• Governor Gavin Newsom defended the program’s expansion, highlighting that in-home care is significantly less costly than institutional care, while advocates and caregivers express concern about the impact of funding delays on vulnerable populations.
• The federal action aligns with a broader crackdown on Medicaid fraud targeting states like California, New York, and Hawaii, including a new nationwide moratorium on enrolling new hospice providers in Medicare announced alongside the funding freeze.