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The Trump administration is launching a major crackdown on government waste and abuse, targeting billions of federal tax dollars spent on healthcare for illegal immigrants while implementing new work requirements for able-bodied Americans on Medicaid.
During a White House news briefing Tuesday afternoon, Centers for Medicare and Medicaid Services (CMS) Administrator Dr. Oz outlined an aggressive strategy to stop “legalized money laundering” that he warned would have cost the program an additional $5.4 trillion over the next decade.
Oz revealed the administration identified roughly $2 billion in federal tax dollars improperly going to illegal immigrants, a number that has doubled since he reported on the issue last year.
Dr. Mehmet Oz, administrator of the Centers for Medicare & Medicaid Services, during a news conference in the James S. Brady Press Briefing Room of the White House in Washington, DC, US on Tuesday, June 2, 2026. (Aaron Schwartz/CNP/Bloomberg via Getty Images)
FED AUDIT, EMERGENCY MEDICAID UNDERCUT DEMS ON ILLEGAL IMMIGRANT HEALTH COVERAGE
He specifically took aim at California, noting CMS told the state it owes the federal government $2 billion — half of which has already been successfully recouped.
“Just to put it in context, in California, if you’re on Medi-Cal, the Medicaid program in California, until this administration, you got full dental and full vision benefits,” Oz said. “Now, I’m for those benefits, I like them, but we don’t give that to Medicare patients. So we should at least be equitable, and all of us together should decide what we are going to do as a nation.”
“The people who pay that bill, when … the largesse of California allows folks to get benefits that the rest of the country doesn’t think is appropriate for illegal immigrants …, is paid by folks who are taxpayers in New Mexico — which is a blue state — and Mississippi, a red state,” he continued.
Dr. Mehmet Oz, administrator of the Centers for Medicare & Medicaid Services, discussed a number of healthcare topics during a news conference with reporters on Tuesday, June 2, 2026. (Aaron Schwartz/CNP/Bloomberg via Getty Images)
In tandem with cutting funds for illegal immigrants, the administration is overhauling Medicaid by instituting work requirements.
The new rule will mandate that able-bodied recipients must work for 20 hours a week, volunteer or get an education in order to receive free healthcare coverage.
“If you’re sitting at home, which is true for the millions of people who are able-bodied on Medicaid, on average, you’re spending 6.1 hours watching television just hanging around,” Oz said.
He framed the new requirements as a “path to prosperity,” claiming they return Medicaid to its original 1965 intent.
Dr. Mehmet Oz, administrator of the Centers for Medicare & Medicaid Services, takes questions from members of the media during a news conference at the White House in Washington, DC, US on Tuesday, June 2, 2026. (Aaron Schwartz/CNP/Bloomberg via Getty Images)
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Oz argued that anyone receiving value from the American people should have an obligation to participate in society if they are physically able.
“If you can work, you should get up and work,” Oz said. “… If we put guardrails around these programs, we’ll allow them to thrive. I’m here because I love Medicaid. The president has already said he loves and cherishes Medicaid and Medicare. … We cannot allow these programs to be defrauded into a turmoil that they cannot pull up from. If we love these programs, we will make the difficult decisions.”