WASHINGTON (AP) — Vice President JD Vance announced Wednesday that the Trump administration would “temporarily halt” some Medicaid funding to the state of Minnesota over fraud concernsas part of what he described as an aggressive crackdown on misuse of public funds.

Vance, who made the announcement with Dr. Mehmet Oz, the administrator for the Centers for Medicare and Medicaid Services, said the administration was taking the action “in order to ensure that the state of Minnesota takes its obligations seriously to be good stewards of the American people’s tax money.”

Oz, who referred to people committing fraud as “self-serving scoundrels,” said the federal government would hold off on paying $259.5 million to Minnesota in funding for Medicaid, the health care safety net for low-income Americans.

“This is not a problem with the people of Minnesota, it’s a problem with the leadership of Minnesota and other states who do not take Medicaid preservation seriously,” Oz said.

Wednesday’s move is part of a larger Trump administration effort to spotlight fraud around the country. That effort comes after allegations of fraud involving day care centers run by Somali residents in Minneapolis prompted a massive immigration crackdown in the Midwestern city, resulting in widespread protests. President Donald Trump, in his State of the Union address on Tuesday, announced Vance would spearhead a national “war on fraud.”

Trump also recently nominated Colin McDonald to serve as the first assistant attorney general in charge of a Justice Department division dedicated to rooting out fraud.

Minnesota pushes back

Oz said the administration was simultaneously notifying Minnesota’s Democratic Gov. Tim Walz as he was making the announcement publicly.

“We will give them the money, but we’re going to hold it and only release it after they propose and act on a comprehensive corrective action plan to solve the problem,” Oz said.

He said Walz would have 60 days to respond and advised health care providers and Medicaid beneficiaries who were concerned to contact Walz’s office.

Walz, former Vice President Kamala Harris’ 2024 running mate, said in a pair of social media posts that the administration’s move had nothing to do with fraud.

“This is a campaign of retribution. Trump is weaponizing the entirety of the federal government to punish blue states like Minnesota,” Walz said. “These cuts will be devastating for veterans, families with young kids, folks with disabilities, and working people across our state.”

Minnesota Attorney General Keith Ellison said in a statement that his team has secured over 300 Medicaid fraud convictions since he took office in 2019. And he noted that he called on the Legislature earlier Wednesday to give him more staff and new legal tools to combat Medicaid fraud.

“Courts have repeatedly found that their pattern of cutting first and asking questions later is illegal, and if the federal government is unlawfully withholding money meant for the 1.2 million low-income Minnesotans on Medicaid, we will see them in court,” Ellison said.

Oz said the Centers for Medicare and Medicaid Services were also taking action to crack down on fraud in Medicare, the health care system relied upon by millions of older adults.

He said CMS for six months would block any new Medicare enrollments for suppliers of durable medical equipment, prosthetics, orthotics or other supplies used to treat chronic conditions or assist in injury recovery.

The Office of the Inspector General for the U.S. Department of Health and Human Services found last year that Medicare improperly paid suppliers nearly $23 million for durable medical equipment from 2018 through 2024. But it found that most of that was before January 2020, when changes to the system were implemented.

Oz also announced a new crowdsourcing effort he said would help “crush fraud” by soliciting Americans’ tips and suggestions.

“All of us are smarter than any one of us,” he said.

In a news release accompanying the announcement, CMS said the funding being paused in Minnesota included some $244 million in unsupported or potentially fraudulent Medicaid claims and about $15 million in claims involving “individuals lacking a satisfactory immigration status.”

Immigrants who are not living in the U.S. legally, as well as some lawfully present immigrants, are not allowed to enroll in the Medicaid program that provides nearly-free coverage for health services.

CMS said in the release that if Minnesota fails to satisfy its requirements, it may defer up to $1 billion in federal funds to the state over the next year. CMS spokesperson Catherine Howden said the agency’s review of potential fraud cases would include sampling claims to see if they comply with federal requirements, and potentially requesting more information about specific claims.

Akeiisa Coleman, the senior program officer for Medicaid at the Commonwealth Fund, said CMS was taking a “highly unusual step” in deferring funding. She said if the state doesn’t have enough funds available, it may have to halt payments to providers, which could affect care.

Democratic-run states face cutoffs

The administration has threatened to cut off funding for various programs for some Democratic-run states over fraud concerns over the last few months.

One judge blocked those actions and required that payments flowing to Minnesota and four other states — California, Colorado, Illinois and New York — for a variety of social service programs. The government had said that there was “reason to believe” that those states were granting benefits to people in the country illegally. It did not initially explain where that information came from, but a government lawyer told the judge it was largely in reaction to news reports about possible fraud.

Another judge said she would not let it cut off funding for administrative costs for 22 states that have refused to hand over information about applicants and recipients of food aid through the Supplemental Nutritional Assistance Program.

The latest action was prompted in part by a series of fraud cases, including a nonprofit called Feeding Our Future accused of stealing pandemic aid meant for school meals. Prosecutors have put the losses from that case at $300 million.

Since then, Trump has targeted the Somali diaspora in Minnesota with immigration enforcement actions and has made a series of disparaging comments about the community. During his State of the Union address on Tuesday, Trump said “pirates” have “ransacked Minnesota.”

Federal agencies have also been enlisted to assist in targeting fraud in Minnesota.

Last December, the U.S. Treasury Department issued an order requiring money wire services that people use to send money to Somalia to submit additional verification to the Treasury.

The Center for Medicare and Medicaid Services told Minnesota in January that it intended to freeze parts of payments for some Medicaid programs that were deemed high-risk. The state said that those cuts would add up to more than $2 billion annually if they lasted and made an administrative appeal.

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Associated Press writers Geoff Mulvihill in Philadelphia, Steve Karnowski in Minneapolis and Fatima Hussein in Washington contributed to this report.

Turning Point Action, the political organization founded by the late conservative activist Charlie Kirk, will bring together U.S. and international politicians at a conference next week — including members of far-right parties across the globe.

Markus Frohnmaier, a political leader from the far-right German party Alternative für Deutschland (AfD), is among the announced guests at the Alliance of Sovereign Nations, scheduled for March 4 to 6 in Washington. Other guests include House Speaker Mike Johnson (R-La.); Rep. Anna Paulina Luna (R-Fla.); George Simion, founder of the far-right Alliance for the Union of Romanians; and European Parliament members Barbara Bonte of the far-right Vlaams Belang party and Petra Steger of Austria’s right-wing Freiheitliche Partei (FPÖ).

In an interview, Turning Point Action COO Tyler Bowyer said the event was “spurred” by Luna and that more attendees will be announced soon. He referred to the parties that will be represented, including AfD, as “center-right.”

Germany’s Federal Office for the Protection of the Constitution in May 2025 classified parts of the AfD as “proven right-wing extremist” for being an alleged threat to the country’s democratic order and agitating against migrants. But the party filed a legal challenge, and a court made a temporary ruling this week suspending the designation until the case is fully decided.

“There’s a lot of people from a lot of different countries that are representing center-right politics across the world. So it’s important to hear everyone,” Bowyer said. “There’s a lot of things going wrong in Germany right now. It’s important to hear everybody out.”

Spokespeople for Johnson and Luna declined to comment. In a social media post Wednesday morning, Luna wrote, “Next week members of government from around the world will be coming together at the Alliance of Sovereign Nations! @SpeakerJohnson will be there!”

The conference’s mission statement declares “every country has a rightful obligation to defend its sovereignty and put their interests first,” according to its website. The conference is also sponsored by Republicans for National Renewal.

The AfD party has gained increasing support in Trump’s Washington. Secretary of State Marco Rubio and Vice President JD Vance have condemned efforts to label the party as extremist. Frohnmaier has recently traveled several times to Washington for meetings with Luna and other Republican representatives as well as State Department officials. State Department officials have accused the German government of suppressing freedom of opinion, an accusation the German government strongly rejects. Sarah Rogers, undersecretary of State for diplomacy, this week called a criminal investigation by German police of a critical post directed at German Chancellor Friedrich Merz “a case of lèse-majesté.”

In October, Luna posted on X that she met with Anna Rathert, a member of Germany’s federal parliament who’s part of the AfD’s parliamentary group and member of the foreign affairs committee in Bundestag. She and other members of Congress also met with Kay Gottschalk and other members of the AfD in Washington in December. She praised the party as “actually working to strengthen ties with the United States and restore a healthy relationship between our governments” and accused Germany’s chancellor of “trashing our president and censoring German citizens.”

In an interview with Welt last November, Luna said she was planning the conference as an event that “will counter Davos” and be more focused on “the sovereignty of nations.”

In Germany, AfD currently polls in second place, only a few percentage points behind the governing Christian Democrats of Merz.

Last December, Frohnmaier was awarded a prize at the New York Young Republican Club gala for AfD’s “courageous work undertaken in the particularly suppressive and hostile political environment of Germany,” as the invitation stated.

Only weeks earlier, the New York State Young Republicans chapter was disbanded after POLITICO reported on a group chat in which leaders praised Adolf Hitler and joked about the Holocaust.

Data centers, once popular with elected officials in both parties, are fast becoming a midterms bogeyman.

Democratic governors are racing to rein in new warehouse projects they once offered up millions of dollars in tax incentives to secure as they face voters furious over soaring electric bills. And President Donald Trump, who has slashed red tape around the industry he’s lauded as a job engine, used his Tuesday State of the Union address to announce he’s told major tech companies to build their own power plants to shield ratepayers from further hikes.

It’s a remarkable pivot by leaders of both parties. And it reflects the rapidly shifting politics around data centers they had hailed as economic generators but are now retreating from as voters blame their proliferation for rising utility costs — part of an overall frustration with high prices that is dominating the midterms.

“The fact that everyone is talking about this all of a sudden shows how quickly this issue is moving and that politicians are reflecting the frustration that people are feeling over paying so much on their energy bills while data centers get tax breaks,” said Jared Leopold, a Democratic strategist and co-founder of climate advocacy group Evergreen Action.

These recent contortions also show both parties are still grappling with the way forward on an increasingly potent political issue.

Democrats harnessed voters’ frustrations over rising utility bills — and their fears that power-hungry data centers could push them higher — to win governor’s offices in New Jersey and Virginia and oust two Republicans on Georgia’s utility regulating commission last fall.

Voters’ worries haven’t ebbed. The POLITICO Poll found in mid-January that voters’ chief concerns about data centers involved household costs. Asked about the drawbacks to building data centers in the U.S., 29 percent of Americans said it would mean higher electricity bills, 24 percent said an increased risk of blackouts and 23 percent said the projects would cost taxpayer money.

Both parties have seized on making tech companies pay for their power as a salve.

Just six months ago, Trump declared he was accelerating federal permitting for data centers and headed to western Pennsylvania to praise companies for investing tens of billions of dollars in energy infrastructure as part of his push to be the “world’s No. 1 superpower in artificial intelligence.”

But on Tuesday, the president said he was negotiating with the companies behind data centers to build their own power plants to secure their power supply “while at the same time lowering prices of electricity” for Americans.

Trump was light on the details about what his “ratepayer protection pledge” actually meant in practice, though the White House said tech companies are expected to head to Washington next week to sign the agreements. But the president has been signaling such a step since at least January, when he said he was working with Microsoft to “ensure that Americans don’t ‘pick up the tab’” for data centers’ power consumption. He also banded together with Democratic governors to push grid operator PJM to control energy prices and tech companies to shoulder the burden of power costs.

Brendan Steinhauser, a Texas-based GOP strategist, said the shift shows Trump and his team “don’t want to be on the wrong side of this.”

“This is smart by the administration to recognize that there are concerns about energy prices and water usage,” said Steinhauser, who serves as CEO of The Alliance for Secure AI, a group that backs more AI industry regulation. “They don’t want to be seen as allowing the companies to accelerate without any input from the community, they don’t want to be seen as on the side of allowing energy prices to go up.”

Democrats don’t, either.

At least half a dozen Democratic governors — several of whom are potential 2028 presidential contenders — used their annual state-of-the-state addresses to pitch regulations or call to retract old sweeteners for an industry they had previously championed.

Illinois Gov. JB Pritzker is pushing to hit pause on tax incentives he’s long touted to lure data centers to his state. Arizona Gov. Katie Hobbs is seeking to eliminate the tax breaks for tech companies she previously backed as a state lawmaker a decade ago, while looking to impose new water-use fees.

New York Gov. Kathy Hochul, who was positioning her state as a “national leader in AI research and innovation,” has rolled out plans to make data center operators pay more for energy or supply their own. Connecticut Gov. Ned Lamont signaled his state would look to “slow down new data centers,” unless they add more power generation.

And Pennsylvania Gov. Josh Shapiro, who streamlined permitting to help his state be “all in on AI,” is now calling on his legislature to codify a set of “responsible infrastructure development” standards for data center developers — including hiring locally and bringing their own power generation — as he looks to mitigate voters’ concerns. A survey released Wednesday from Pennsylvania pollster Quinnipiac University showed 68 percent of registered voters would oppose a data center being built in their community, including 81 percent of Democrats, 67 percent of independents and 53 percent of Republicans.

Shapiro insisted his new guardrails were “not a shift” when asked last week about the policy rollout. Instead, he cast them as part of his ongoing efforts to balance creating jobs with “holding down energy costs.”

“I’ve always been for the end-users having to bring their own power or generate new power and pay for it so we’re not burdening the local community,” Shapiro told Blue Light News on the sidelines of the National Governors Association winter meeting in Washington last week. “We just are more open about it, so anyone thinking about doing business in Pennsylvania now knows what those standards are going to be.”

The proliferation of data centers across battleground states has similarly pushed energy costs to the forefront of key congressional campaigns. Imposing guardrails on the artificial intelligence industry has become a rallying cry for insurgent candidates in primaries and an attack line in competitive districts. Calls are growing on both sides of the aisle for a moratorium on new projects.

Politicians are “beginning to catch up with where their constituents are” in opposing unregulated data center growth, said Mitch Jones, the managing director of policy and litigation for environmental firm Food & Water Watch, which is pushing for a construction pause.

But Maryland Gov. Wes Moore, who has sketched out a similar set of rules for new projects in his state, argued that a “binary” approach to data centers was misguided.

“Oftentimes, when people talk about data centers, it’s either like what they’ve done in Northern Virginia, which is kind of like, ‘let them just run wild and do whatever they want to do.’ Or it’s like trying to put a ban on them. I don’t think either is the right answer,” Moore said in a brief interview at NGA. “I understand how this critical infrastructure is necessary for economic growth. … But industry cannot determine the rules.”