Federal Government Wrongly Accuses New York of Medicaid Fraud

Report finds basic math error led to fraud allegations against state's program

Apr. 10, 2026 at 8:04am

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A translucent, ghostly X-ray image of a Medicaid enrollment card, with the internal structure of the card glowing against a dark background, conceptually representing the analytical investigation into Medicaid data.An X-ray analysis of Medicaid enrollment data reveals flaws in the federal government's fraud accusations against New York State.NYC Today

A new report has found that the federal government wrongly accused New York State of running a fraud-ridden Medicaid program. The Centers for Medicare and Medicaid Services (CMS) sent a letter to state officials claiming over 5 million New Yorkers received home care in early 2025, but an analysis found this was due to a basic math error by federal officials.

Why it matters

The federal government's accusations of widespread Medicaid fraud in mostly Democratic-led states have raised concerns about potential cuts to Medicaid funding. This report on the erroneous nature of the fraud claims against New York casts doubt on the seriousness and accuracy of the administration's anti-fraud campaign.

The details

According to Michael Kinnucan, health policy director at the Fiscal Policy Institute, the federal officials made a mistake by adding up the monthly unique Medicaid home care users to get an annual total, rather than recognizing that the 100,000 users in March, April and May would not necessarily equate to 300,000 total users over that 3-month period. Kinnucan noted that New York only has around 7 million Medicaid enrollees total, most of whom are non-disabled adults and children who do not require home care.

  • In early 2025, CMS claimed over 5 million New Yorkers received Medicaid home care.
  • In April 2026, a new report found the federal government's fraud accusations against New York were based on a basic math error.

The players

Dr. Mehmet Oz

Administrator of the Centers for Medicare and Medicaid Services (CMS), who sent a letter to New York state officials accusing them of running a fraud-ridden Medicaid program.

Michael Kinnucan

Health policy director at the Fiscal Policy Institute, who analyzed the federal government's data and found the accusations against New York were based on a math error.

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What they’re saying

“After reviewing the numbers and puzzling on it a bit, I realized what they were actually doing [was] adding up the monthly unique users in the program to get an annual total.”

— Michael Kinnucan, Health Policy Director, Fiscal Policy Institute

“We know what helps to address fraud, which is collaborative partnership between the state and the federal government, and good data, well-analyzed. The fact that there's this adversarial relationship and bad data happening in the federal alleged anti-fraud campaign really raises questions about what they're trying to do.”

— Michael Kinnucan, Health Policy Director, Fiscal Policy Institute

What’s next

With a second budget reconciliation bill in the works, some advocates worry the federal government's accusations of widespread Medicaid fraud, even when proven inaccurate, could still be reflected in future Medicaid spending.

The takeaway

This case highlights the importance of rigorous data analysis and collaboration between state and federal governments when addressing complex issues like Medicaid fraud. The erroneous nature of the fraud claims against New York raises serious doubts about the credibility and motivations behind the administration's broader anti-fraud campaign.