The guy who sold miracle weight loss supplements on daytime television for fifteen years would like you to know that blue state governors are running a sophisticated, coordinated Medicaid fraud operation as a deliberate political strategy. Dr. Mehmet Oz, now head of the Centers for Medicare and Medicaid Services, sat down with Fox News Digital this week and explained, with a straight face, that states aren't just tolerating Medicaid fraud. They're engineering it on purpose.
The Theory, Such As It Is
Here is what Oz actually told Fox News, because the facts deserve to breathe before we torch them. His argument goes like this: blue states create Medicaid-funded care programs, hire workers to run them, collect federal reimbursements, tax those workers' wages to pad state coffers, and then watch those workers unionize and funnel dues into Democratic PACs. "Stealing money from Medicaid is not a flaw for a lot of states, it's a feature of the program," Oz said. He claims they even have a name for it: "Medicaid-ing it."
He also says this whole arrangement benefits Democrats electorally because the unions fund the party. "That party now has a lot of money coming in for local and state elections, and we are paying for it!" he lamented. The exclamation point is his. The breathtaking leap in logic is also his.
To be clear, nobody Oz spoke to at Fox News asked him to define "Medicaid-ing it," produce evidence that the term exists, or explain what actual fraud looks like versus what is simply a state building its service economy with federal healthcare dollars. These are distinctions that matter, a lot, and they went unexamined.
Newsom Gets the Special Treatment
California's governor caught the sharpest end of Oz's accusations. According to Fox News, Oz claims Newsom was warned by his own state auditors four years ago that California had "widespread fraud" in its Medicaid program and failed to act meaningfully. "He's embarrassed," Oz said. "They did some performative things, but they didn't actually do the important steps required to stop fraud in the state."
The Trump administration has already acted on this. Fox News reports that CMS cut over $1.3 billion in California's Medicaid reimbursements in response to what Oz described as an inability to verify where money was going. "We can't understand where the money's going," he said. That is a significant funding cut to a program that provides healthcare to millions of low-income Californians, and it is worth sitting with that number for a second.
Now, did California have real Medicaid oversight problems? California's own auditors have, in fact, raised flags about fraud and waste in its Medi-Cal program over the years. That part is not invented. The question is whether sloppy oversight, which plenty of states across both parties have been guilty of, is the same thing as a coordinated conspiracy to launder federal money into union PACs. Those are two very different accusations, and Oz is treating them as interchangeable.
The Union Conspiracy Layer of This Cake
Oz's most creative contribution to this debate is the unionization angle. His claim is that home care and service workers hired under Medicaid programs get organized by unions, pay dues, and those dues fund Democratic political operations. "Of course, one party, always," he said.
Here is what that argument is actually describing: workers organizing for better pay and conditions, something that has been legal in this country since 1935. Unions do support Democrats. This is not a secret. It is also not fraud. Conflating a political preference among organized labor with the criminal act of billing Medicaid for services that were never rendered is doing a genuinely enormous amount of work in Oz's framing, and Fox News let him do it without a single interrupting question.
The Anti-Fraud Task Force That Has JD Vance's Name On It
Fox News also reports that Vice President JD Vance has begun leading a new administration anti-fraud task force targeting exploitation of federal benefit programs. Oz urged all governors to get in line behind the president's efforts, warning that those who are not aligned are "pulling the oars in the opposite direction."
That is a colorful way to describe what is, in practice, a demand that Democratic governors cooperate with an administration that just cut over a billion dollars in their healthcare funding. Oz framed the path forward as collaborative. "Fraud happens because the people who have the power to stop it don't work together," he said. He did not appear to register any irony in calling for cooperation immediately after describing blue state governors as deliberate co-conspirators in a federal money laundering scheme.
Who Is Running CMS, Again
It is not petty to mention this. It is genuinely relevant context. Mehmet Oz spent decades as a television personality promoting health products and treatments that drew repeated scrutiny from the medical community and a 2014 Senate hearing where he was grilled for marketing supplements with no scientific backing. He lost a Senate race in Pennsylvania in 2022. Donald Trump then appointed him to run the agency that oversees over $1.5 trillion in annual federal health spending.
Oz is not a healthcare administrator. He is not a policy expert. He is a celebrity with a medical degree who is now making billion-dollar decisions about who gets Medicaid funding and framing it as an episode of The Oz Show where blue states are the villain of the week. That is the actual situation. Hold that in your mind when evaluating how seriously to take his theory about governors deliberately engineering fraud as a PAC funding mechanism.
The Dingo Take
Look, Medicaid fraud is real. Full stop. It happens in red states and blue states, it costs taxpayers billions, and it should be investigated aggressively and fixed. Nobody serious is defending fraud. The California auditors Oz cites did raise legitimate concerns, and the state did not move fast enough to address them. That part of this story is true and it matters.
But what Oz is doing here is something different and considerably more cynical. He is taking a real problem and inflating it into a unified conspiracy theory that conveniently explains why every Democratic policy decision, every union, every Medicaid expansion, is secretly a criminal enterprise designed to fund the opposition party. That is not oversight. That is a Fox News segment dressed up in regulatory authority. And using that framing to justify cutting $1.3 billion from a state's healthcare reimbursements, money that flows to actual doctors and patients and caregivers, is not fighting fraud. It is using the language of accountability as a weapon.
The person making these accusations sold viewers on green coffee bean extract. He is now one of the most powerful healthcare administrators in the United States government. If that does not make you want to pay very close attention to what CMS does next, nothing will.
