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Disability Policy News

AUCD's Disability Policy News (DPN) is a weekly newsletter highlighting federal policy issues affecting people with disabilities and their families. DPN features updates in plain language and action steps that people can take to educate policymakers. DPN is published every Friday.

February 27, 2026 | Vol. MMXXVI | Issue 150

In this edition:

  • Healthcare
  • Department of Health and Human Services
  • GAO Report on Disabled Job Seekers
  • House Ways & Means Committee Hearing
  • Department of Education
  • New Legislation
  • AUCD Materials
  • Words to Know

Healthcare

President Trump announced on February 24 during his State of the Union address that Vice President J.D. Vance will be leading efforts to crack down on healthcare fraud. The President alleged that there has been widespread Medicaid fraud across the country, especially in Minnesota, California, Massachusetts, and Maine. He alluded to potential changes to Medicaid funding should his Administration find more fraud. The President also talked about his Administration’s efforts to lower drug prices using the most favored nation practice. He blamed Democrats in Congress and the Affordable Care Act for high healthcare prices.

On February 25, Vice President Vance, Secretary of Health and Human Services (HHS) Robert F. Kennedy, Jr., and Administrator of the Centers for Medicare & Medicaid Services (CMS) Dr. Mehmet Oz announced that the Administration would cut off $259 million in Medicaid funding to Minnesota after an audit found unsupported or possibly fraudulent Medicaid claims. Minnesota has appealed and is waiting for a hearing with HHS; in the meantime, CMS is allowing continued Medicaid funding to go to the state while they appeal. The Administration is also issuing a six-month national moratorium on Medicare enrollment for certain durable medical equipment, which CMS Administrator Oz said is a frequent target for fraud. Durable medical equipment is reusable, medically necessary equipment and includes things like prosthetics, wheelchairs, and hospital beds.

The Administration is also announcing a request for stakeholder input (in a 30 day comment period) to collect suggestions for preventing fraud. The responses from stakeholders could inform a future rule under CMS’ Comprehensive Regulations to Uncover Suspicious Healthcare (CRUSH) initiative.

Key Takeaways

Minnesota Governor Tim Walz has said that the state has made significant efforts to rectify the gaps in its Medicaid program oversight and prevent fraud. He has accused the Administration of weaponizing the federal government to punish Democrat-led states like Minnesota by cutting off such a significant amount of Medicaid funding. In December 2025, the Department of Justice charged multiple defendants for allegedly defrauding a Minnesota healthcare program, purporting to provide therapy for autistic children. On January 6, CMS cut off $2 billion in Medicaid funding to Minnesota. CMS says that, at that time, it “notified Minnesota of its intent to withhold federal funds until it was satisfied with the state’s corrective action plan to address its program integrity shortcomings.”

The Administration has carried out an enormous immigration enforcement operation in Minneapolis, which has been widely protested. Some of the most significant clashes between immigration enforcement and protesters have occurred in Minneapolis, including the murders of Renee Good and Alex Pretti.

Plain Language

The President gave a speech called the State of the Union. This speech is given by the President each year in February to talk about important issues in the country and announce the things the President's Administration will work on. This year, the President talked about these things that are related to healthcare:

  • Medicaid and Medicare fraud
  • Drug prices
  • High healthcare prices

The President announced that Vice President J.D. Vance will lead a project to stop Medicaid fraud. Fraud is when someone pretends to be someone or do something so they can get money. There were some people in Minnesota who pretended to offer autism therapy services so they could get money from Medicaid. The President is saying that people are committing fraud in Minnesota, California, Massachusetts, and Maine. Vice President Vance is going to work with Department of Health and Human Services (HHS) Secretary Robert F. Kennedy, Jr. and the leader of the Centers for Medicare and Medicaid Services (CMS), Dr. Mehmet Oz. They are cutting off $259 million in Medicaid dollars from Minnesota. Minnesota Governor Tim Walz says that this is unfair, because Minnesota is working hard to stop fraud. He said the Administration is punishing Minnesota because he is a Democrat and because many people in Minnesota are protesting against the Administration's immigration policies. Some of the biggest news from the last year about immigration police came out of Minnesota. Immigration police killed two people in Minneapolis, Minnesota: Renee Good and Alex Pretti.

The Administration is announcing that they want people to comment on how they think the government can stop fraud. They are giving people 30 days to comment.

Durable medical equipment are things that people use to get around or get healthcare. They include things like prosthetics, wheelchairs, and hospital beds. The Administration is stopping certain companies from getting Medicare money for their durable medical equipment for six months. They say that a lot of companies are committing fraud through Medicare's durable medical equipment program.

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Past Issues

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