Attorney General James Condemns Trump Administration for Slashing New York’s Resources to Fight Medicaid Fraud

New York Attorney General Letitia James today condemned the Trump administration’s decision to cut funding for the Office of the Attorney General’s (OAG) Medicaid Fraud Control Unit (MFCU), which investigates and prosecutes Medicaid fraud and has recovered more than $627 million through fraud investigations since 2019.

“This administration's unprecedented attack on New York is another political distraction,” said Attorney General James.  “During my time as Attorney General, my office has recovered more than $627 million for Medicaid and was recognized by this very administration for leading the nation in anti-fraud efforts.  The only people this decision benefits are the criminals we investigate every day.  We are considering all legal options to stop this outrageous action.”

New York’s MFCU has long been recognized as a national leader in effectively investigating and prosecuting Medicaid fraud schemes, including systemic neglect and abuse in New York nursing homes.  From federal fiscal years 2019 through 2025, New York’s MFCU has recovered $627,812,108 for the Medicaid program through its criminal and civil investigations and prosecutions.  The Trump administration’s own Inspector General for the Department of Health and Human Services (HHS) has recognized New York as a national leader in fraud recoveries.  In its 2025 report on states’ MFCU performance, HHS highlighted that New York was one of the four states that accounted for half of the total civil recoveries in fiscal year 2025.

New York’s MFCU’s criminal investigations have recovered millions of dollars and led to dozens of convictions in recent years.  Yesterday, Attorney General James announced the arrest and indictment of a Long Island fraudster for allegedly stealing more than $2.5 million from Medicaid through a fraud scheme that left children without the nutritional supplements they needed.  Last week, Attorney General James announced the indictment and arrest of another Medicaid fraudster for stealing more than $9 million from Medicaid in a years-long scheme.  In 2025, New York MFCU conducted a statewide investigation into medical transportation companies for using fake billing schemes to steal millions of dollars.  The investigation has led to ten criminal convictions and more than $13 million recovered for New York.  Also in 2025, Attorney General James secured the sentencing of a serial health care fraudster for wrongfully billing Medicaid millions of dollars for fraudulent medical testing services.