Trump pledges to take back more than $1 billion misused by states for health care for illegal immigrants

First on Fox: The Trump administration plans to claw back more than $1 billion in federal Medicaid dollars that it says blue states are spending on health care for illegal immigrants, including some with violent criminal records for murder and rape.

Initial review by the Centers for Medicare and Medicaid Services It found that over the past few years, mostly during 2024 and 2025, in California; Washington, DC; illinois. Washington; Colorado; Oregon improperly spent a total of $1,351,204,127 in federal Medicaid funds to help pay for health care for undocumented immigrants.

While the use of federal Medicaid funds is supposed to be prohibited broadly to cover health care for illegal immigrants, they can be used by states for emergency treatment regardless of a patient’s citizenship or immigration status.

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States can also legally cover health insurance for illegal immigrants as long as it is done with only state tax dollars. But according to some experts, Democrats are exploiting loopholes in federal laws that allow them to offer sweeping health benefits to illegal immigrants.

“Protecting Medicaid from waste, fraud and abuse is not optional. It is the law. Every dollar spent illegally on illegal health care spending is a dollar taken from vulnerable Americans,” CMS spokeswoman Emily Hilliard told Fox News Digital.

“Federal law prohibits the use of Medicaid funds for illegal immigrants, but many Democratic-led states did so anyway. The Trump administration will not tolerate this. CMS is aggressively auditing, reclaiming every dollar and holding states accountable.”

California was the biggest culprit of all, spending more than $1 billion in federal Medicaid dollars on health care for undocumented immigrants, according to CMS. The next biggest violator was Illinois, which CMS said improperly spent nearly $30 million, followed by Oregon, which the audit found improperly spent about $5.5 million.

California Gov. Gavin Newsom’s office has denied allegations that his state is improperly using federal funds to pay for health care for illegal immigrants, telling the Los Angeles Times that Republicans’ claims are “false.”

But Steve Helton, the former Fox News anchor and current Republican candidate running to be California’s next governor with Newsom’s term limited, argued that California uses a complex Medicaid provision known as the “provider tax” to obtain matching federal dollars, which are then pooled into funds the state uses to pay for health care provided to undocumented immigrants.

California is abusing federal provisions that allow states to use federal Medicaid dollars to provide emergency care to undocumented aliens, said Chris Pope, a public health policy expert at the Manhattan Institute.

Fox News Digital reached out to Newsom’s office for comment on this story but did not receive a response.

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“Medicaid is by far the largest source of federal funding for states,” Pope said. “It was originally intended to provide assistance only to eligible beneficiaries, but over time, states figured out how to game the system, stuffing allowable expenses, and diverting profits to fund supposedly prohibited activities.”

“Any claim that government health care expenditures do not ultimately involve some form of federal funds should be viewed with suspicion.”

Jim O’Neill, current acting director of the Centers for Disease Control and Prevention and deputy secretary of Health and Human Services, also highlighted that among the federal funds that improperly go to undocumented immigrants, some also goes to undocumented immigrants with violent criminal pasts. O’Neill has been posting a daily “MorningMedicaidMugshot” with examples over the past few days.

On October 29, O’Neill highlighted Laith Kamel, a 24-year-old illegal alien from Iraq who was convicted of exposing himself to a 15-year-old who, according to O’Neill, received nearly $16,000 in taxpayer-funded health care through Medicaid. The day before, O’Neill highlighted the story of Hissam Masalkhi, a 45-year-old illegal alien from Lebanon, who was convicted after driving under the influence and killing an American citizen who was jogging outside. Masalkhi received more than $30,000, according to O’Neill.

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Other illegal aliens highlighted by O’Neill include people convicted of attempted murder and child rape.

“Democrats demand continued Medicaid funding for this violent, illegal alien as a condition for reopening the government and paying the hardworking public servants in my department,” O’Neill said in a recent “MorningMedicaidMugshot” post.