While several Democrats expressed outrage over the possibility that President Donald Trump’s temporary federal spending freeze could threaten Medicaid funding, they remained silent amid reports of the Biden-Harris administration’s Centers for Medicaid and Medicare Services (CMS) seemingly “targeting” certain red states with Medicaid program audits.
The Trump-Vance administration ordered a temporary federal spending freeze on Monday, though a federal judge appointed by former President Joe Biden issued a temporary injunction against it the following day. Though the freeze was met with immediate backlash from many Democrats, few called attention to a government watchdog report that accused the Biden-Harris administration of unfairly targeting red states with burdensome regulations which could threaten Medicaid funding if the states were unable to fully comply.
Following the uproar in response to the temporary spending freeze, the White House clarified on Tuesday that “mandatory programs like Medicaid and SNAP [Supplemental Nutrition Assistance Program] will continue without pause” under the freeze.
Still, Senate Democrats raised fears that the pause in funding would impact essential services, writing in a Friday post on X that Trump’s spending freeze was a “cruel action” that would put “desperately needed services at risk.” Concerns raised by Republicans regarding state Medicaid funding after under the former president however, went largely unanswered.
Emails obtained by Government Accountability & Oversight (GAO), a nonprofit government watchdog group, revealed that the CMS, under the Biden administration, targeted Missouri, Texas and Florida with audits over how the states operate their Medicaid programs, as first reported by National Review in January 2024.
In September 2022, the CMS raised concerns that parts of Florida’s Medicaid program “may not comply with certain health care-related tax requirements,” and said that the state was subject to a “focused review.” GOA claimed that the CMS neglected to “apply the same standards to blue states” as they did with red states in a November 2023 press release.
GAO also accused Biden’s CMS of “focusing” on Medicaid programs in red states that have been “particular thorns in the Biden administration’s side,” in the press release.
A CMS official wrote in a February 2023 email obtained by GAO that Florida was “the only one [state] we have concern [about],” though the GOA report outlines multiple red states also allegedly targeted.
Some red states have taken legal action against Biden’s CMS, including Texas, which has sued the agency on multiple occasions. Republican Texas Attorney General Ken Paxton filed a lawsuit against the Department of Health and Human Services (HHS) and CMS in April 2023, over an “unlawful” informational bulletin from the agency that would require the Texas Health and Human Services Commission to provide information regarding private mitigation arrangements, which CMS claimed were “akin to illegal hold-harmless arrangements,” according to National Review.
Federal funding would have been conditional on the state providing this information, which Paxton argued would jeopardize “potentially billions of dollars to which Texas’ Medicaid program is entitled.”
The Texas lawsuit alleged that Biden’s CMS had “wielded its oversight role as a cudgel to force Texas to adopt its policy preferences.” The lawsuit further alleged that CMS’ bulletin would require Texas to monitor private-party arrangements “on pain of the loss of billions of dollars in federal funding.”
Some Republicans criticized Biden’s CMS, including former Republican Maryland Gov. Larry Hogan, who wrote in a January 2024 op-ed for The Wall Street Journal that Biden’s CMS “targeted” red states with selective enforcement of Medicaid financing rules while appearing to have “ignored the same behavior from providers in blue states such as California” that had similar hospital tax arrangements as the red states.
Hogan, alongside other members of the GOP, called for the Biden-Harris administration, who seemingly remained silent on the issue, to explain the CMS’s alleged targeting of red states. The administration “owes the public an explanation” for its CMS’ enforcement “that seems to have gone after red but not blue states,” Hogan further wrote.
Despite several Republicans sounding the alarm on CMS imperiling Medicaid funding in several red states, many Democrats were largely unresponsive on the issue.
As House Republicans now eye budget cuts that could affect dozens of government programs, including Medicaid, many Democrats have since criticized the Trump administration’s spending freeze over concerns that states could possibly lose funds for the program. In January, the Biden-Harris administration’s CMS gave approval for Vermont to allocate funds from Medicaid to cover the cost of rent for some homeless individuals with certain medical needs in the state. Other states reportedly rushed to request approval for additional Medicaid programs before Trump’s return, according to Politico.
Medicaid is one of the largest health expenditures in the U.S., reaching $817.7 billion in 2023, or 18% of the total national health expenditure. Total health spending in the U.S. for 2024 is projected to reach a staggering $2.5 trillion.
In response to the Daily Caller News Foundation’s request for comment regarding GAO’s findings, a CMS spokesperson said they were unable to address non-emergency issues as the incoming team is establishing a new review process.
Government Accountability & Oversight did not respond to a request for comment from the DCNF.
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