{"id":449,"date":"2026-06-06T11:38:54","date_gmt":"2026-06-06T11:38:54","guid":{"rendered":"https:\/\/movingtohawaiiguide.com\/?p=449"},"modified":"2026-06-06T11:38:54","modified_gmt":"2026-06-06T11:38:54","slug":"trump-cuts-funds-to-hawaii-fraud-unit-threatening-states-medicaid-funding-2","status":"publish","type":"post","link":"https:\/\/movingtohawaiiguide.com\/?p=449","title":{"rendered":"Trump cuts funds to Hawaii fraud unit, threatening state\u2019s Medicaid funding"},"content":{"rendered":"
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Hawaii stands to lose around $3 million in federal funding to fight Medicaid fraud after failing to consistently bring criminal cases, the Trump administration said Thursday, in an escalation of Vice President JD Vance\u2019s campaign against healthcare fraud.<\/p>\n

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The U.S. Department of Health and Human Services Inspector General March Bell sent a letter to Hawaii Attorney General Anne Lopez informing her that her state\u2019s Medicaid Fraud Control Unit, a body that investigates and prosecutes fraud by healthcare providers, has been denied federal certification.<\/p>\n

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HHS will no longer fund the unit, which has been receiving around $3 million annually, Bell wrote. Without a federally certified Medicaid fraud unit, the state\u2019s broader Medicaid funding could be in jeopardy.<\/p>\n

Hawaii\u2019s unit obtained no criminal indictments or convictions for Medicaid fraud or patient abuse and neglect between 2022 and 2025, despite increased enrollment in the program, Bell wrote. The state can ask for reconsideration, according to the letter.<\/p>\n

After the administration\u2019s announcement Thursday, the state\u2019s Department of the Attorney General said in a statement that it will ask the HHS to reconsider its decision to defund the Hawaii unit.<\/p>\n

Officials said in a news release that the attorney general\u2019s office \u201cremains committed to protecting Medicaid beneficiaries, safeguarding public funds, and holding accountable those who commit fraud, abuse, or neglect.\u201d<\/p>\n

\u201cWe recognize the seriousness of the HHS\u2019s concerns and are treating this matter with the urgency it deserves,\u201d they said in the news release. \u201cThe department has mobilized additional personnel and resources from across multiple divisions to conduct a comprehensive review of the findings, prepare a formal response, and pursue all available avenues to preserve and strengthen Hawaii\u2019s Medicaid fraud enforcement efforts. We intend to seek reconsideration of HHS\u2019s decision and will continue working closely with our federal partners to address concerns and demonstrate the full scope of the Medicaid Fraud Control Unit\u2019s work.\u201d<\/p>\n

Gov. Josh Green\u2019s office said in a separate that after discussions with the U.S. Centers for Medicare and Medicaid Services, the state\u2019s Department of Human Services \u201chas been informed that Hawaii\u2019s Medicaid program remains in good standing and that this action does not affect eligibility, benefits, provider payments, or federal Medicaid funding.\u201d<\/p>\n

DHS Director Joseph Campos II said in a statement, \u201cThe Medicaid program provides essential healthcare coverage to hundreds of thousands of Hawaii residents and we want our members, providers and community partners to know that their benefits and services will continue without interruption.\u201d<\/p>\n

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Green has also authorized the the creation of an independent Medicaid Fraud Strike Force within DHS \u201cto strengthen oversight, accountability and coordination in the fight against Medicaid fraud, waste and abuse. The strike force will support and build upon the work of Hawaii\u2019s existing Medicaid Fraud Control Unit,\u201d according to the news release.<\/p>\n

\u201cHawaii takes Medicaid fraud seriously,\u201d Green said. \u201cEven before receiving this letter, we were taking steps to strengthen oversight and accountability through the creation of an independent Medicaid Fraud Strike Force within DHS. Our goal is straightforward: protect vulnerable residents, safeguard taxpayer dollars and ensure every available tool is being used to identify and address fraud, waste and abuse.\u201d<\/p>\n

The Trump administration\u2019s move Thursday is part of a broader push on Medicaid fraud enforcement.<\/p>\n

On May 13, Vance accused Hawaii of giving fraudsters \u201cfree rein,\u201d and warned of consequences for states failing to effectively police the program.<\/p>\n

\u201cIf we continue to find problems, we can turn off other resources within their state Medicaid programs as well. Our goal here is not to do that,\u201d he said at the time.<\/p>\n

More than 360,000 Hawaii residents are enrolled in Medicaid, the health program for low-income Americans. Hawaii received $2.2 billion in federal Medicaid funds in 2024, according to the agency that advises Congress on healthcare spending.<\/p>\n

Nationwide, Medicaid fraud units were responsible for more than 4,800 criminal convictions of people and businesses between 2022 and 2025, according to the same agency.<\/p>\n

Lopez has pushed back against the Trump administration\u2019s characterization.<\/p>\n

She has said the state has not ignored Medicaid fraud, pointing to $14 million recovered in civil cases since 2021. The state also charged two people with criminal healthcare fraud earlier this year.\n<\/p>\n

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