One hundred billion dollars. That’s Dr. Mehmet Oz’s estimate of total Medicaid fraud in the United States. Not waste. Not inefficiency. Fraud. Criminal theft from a program designed to provide healthcare to Americans who can’t afford it — stolen by people who’ve turned government insurance into an ATM with a broken lock.
Oz, now running the Centers for Medicare & Medicaid Services, sat down with Katie Miller’s podcast and described what he found in Minnesota as the “weaponization of fraud.” Not garden-variety grift. Not some clerk filing a bad claim. A systemic, deliberate, politically connected operation where the people in charge of preventing fraud chose not to look.
Minnesota: The Case Study
Oz didn’t pick Minnesota at random. The state has become ground zero for federal healthcare fraud investigations, and what he found there goes beyond sloppy bookkeeping.
“There was an almost purposeful desire not to look carefully,” Oz said of Minnesota’s Department of Health and Human Services. The people running the system didn’t just fail to catch fraud. They created conditions where fraud could flourish — and had no incentive to stop it.
Here’s the mechanism. Under federal law, when someone enrolls in Medicaid, they must also be offered a voter ID. Oz described the program as essentially a “voter enrichment and enrollment process.” The more people enrolled, the more voters registered. The more voters registered, the better it is for the politicians who control the enrollment pipeline.
So the incentive was always to enroll more people — not to verify whether they actually qualified. Program integrity? That’s the department nobody funded, nobody staffed, and nobody wanted to hear from. The federal auditing program that was supposed to catch this? Gutted.
The result is a system where people who don’t qualify get full benefits, the money runs out for people who do, and the politicians who oversaw the whole thing get to campaign on how many people they “helped.”
The Southern California Problem
Minnesota is bad. Southern California might be worse.
Oz dropped a statistic that sounds made up but isn’t. Roughly 30% of all hospice services in the entire country are concentrated in Southern California. One region. Nearly a third of national hospice spending. And one in every ten dollars spent on home healthcare in the entire United States is spent not in California — in Los Angeles alone.
The correct figure, according to Oz, should be about a third of what it currently is.
This isn’t organic demand. Nobody believes that LA needs three times more hospice care than its population would justify. This is organized fraud — criminal enterprises billing Medicaid for services that either don’t exist or aren’t needed.
And Oz named names. Russian nationals who fled back to Russia when indicted. Cuban-run operations that the CMS believes involve the Cuban government itself, running fraudulent durable medical equipment schemes — wheelchairs, canes, medical devices billed to the taxpayer and delivered to nobody.
There are “20 times more durable medical equipment providers in South Florida than McDonald’s,” Oz said. Twenty times. In a region where golden arches outnumber palm trees, medical supply storefronts outnumber them all. And most of those storefronts exist for one reason: billing the federal government for equipment that patients never receive.
The $100 Billion Redirect
When Miller asked Oz to estimate total Medicaid fraud, he didn’t hesitate. “$100 billion.”
Then he explained what that money should be doing instead. Extending the Medicare trust fund. Funding mental health services. Expanding care in rural and underserved communities. The $100 billion being stolen every year isn’t abstract government money. It’s the difference between a rural hospital staying open and closing. It’s the difference between a mental health clinic having a six-month waitlist and a six-week one.
Every dollar stolen by a fraudulent hospice operation in LA is a dollar that doesn’t reach an elderly patient in Appalachia. Every fake equipment claim filed by a criminal organization in Miami is a dollar taken from a disabled veteran’s wheelchair budget. The fraud isn’t victimless. The victims just don’t know they’re victims — because they never see the care they were supposed to receive.
The Political Protection Racket
Governor Tim Walz has expressed “skepticism” about the scale of fraud Oz is describing. That’s a polite way of saying he doesn’t want the full picture to emerge — because the full picture implicates the system he oversaw.
Walz says he’s been “working to crack down” on the millions in fraud that have been detected. Millions. Oz is talking about billions. The gap between what Minnesota’s governor acknowledges and what federal investigators are finding isn’t a rounding error. It’s a cover story.
The pattern Oz described — enroll as many people as possible, don’t ask questions, don’t fund oversight, don’t look too hard — isn’t unique to Minnesota. It’s the playbook in every state where Medicaid enrollment is treated as a political achievement rather than a public trust. The bigger the rolls, the bigger the budget, the bigger the opportunity for fraud, and the less incentive anyone has to stop it.
“You have to, again, almost not be looking,” Oz said. Exactly. That’s the point. The system wasn’t broken by accident. It was broken on purpose — by people who benefit from nobody checking the receipts.
What Comes Next
Oz is clearly building toward something. The Minnesota investigation. The Southern California audit. The durable medical equipment crackdown in Florida. Each one is a thread, and they all lead to the same conclusion: Medicaid fraud isn’t a bug in the system. It’s a feature — one that persists because the people responsible for preventing it decided years ago that prevention wasn’t in their political interest.
$100 billion. Every year. Stolen from a program meant for the poorest and sickest Americans. And the people who let it happen are still in office, still collecting paychecks, and still telling you they’re fighting for the little guy.
The receipts say otherwise.