Dr. Oz Warns Walz: Fix the Somali Medicaid Fraud Scandal or Lose Federal Funding — ‘We’ll Cut the Money Off’

Minnesota Governor Tim Walz is facing mounting pressure after Centers for Medicare & Medicaid Services (CMS) Administrator Dr. Mehmet Oz issued a stern warning regarding alleged large-scale Medicaid fraud within the state. In a post on X, Oz claimed that more than $1 billion had been stolen through a scheme perpetrated by “bad actors” within Minnesota’s Somali community, with some of the funds allegedly making their way to the terrorist group al-Shabab.

Federal Funding at Risk

Oz’s message was unequivocal: Minnesota must restore the integrity of its Medicaid program or risk losing federal funding. “If we’re unsatisfied with the state’s plans or cooperation, we’ll stop paying the federal share of these programs,” Oz stated, giving Walz 60 days to implement corrective measures.

The CMS administrator highlighted dramatic increases in costs for two Medicaid programs:
– Housing Stabilization Services: Projected at $2.6 million annually, but paid out over $100 million in 2024.
– Early Intensive Developmental and Behavioral Intervention: Jumped from $3 million in 2018 to nearly $400 million in 2023.

“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.”

Accountability and Oversight

Oz accused Governor Walz and state officials of failing to act, claiming they “went all-in on identity politics” rather than addressing the fraud. He noted that while Minnesota officials previously reported the problem to CMS, their efforts to address it were insufficient.

CMS has already intervened, shutting down the most problematic housing program and freezing provider enrollment in several abused programs. “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,” Oz said.

Trump Administration Crackdown

President Donald Trump has also weighed in, labeling Minnesota a “hub of money laundering activity” and announcing new federal investigations. The administration recently terminated deportation protections for hundreds of Somali migrants and launched a Treasury Department probe into the alleged diversion of taxpayer dollars to al-Shabab, according to Secretary Scott Bessent.

The Broader Impact

The allegations and federal scrutiny have cast a spotlight on Minnesota’s Medicaid programs and the state’s oversight of social services. The threat to withdraw federal funding could have significant consequences for vulnerable residents who rely on Medicaid for essential healthcare and support.

Governor Walz now faces a critical deadline to address the alleged fraud, restore public trust, and ensure the integrity of Minnesota’s Medicaid system—or risk losing vital federal resources.