(DISTRICT OF COLUMBIA) Dr. Mehmet Oz, the Administrator of the Centers for Medicare and Medicaid Services, drew swift pushback from states and health policy experts after asserting on October 31, 2025, that more than $1 billion in federal Medicaid funds were recently spent on health care for “illegal immigrants.” In a social media post, Oz said an audit found that five states and the District of Columbia had used federal dollars to cover ineligible people, calling it a “terrifying reality” and urging tougher oversight.
Within hours, state officials and researchers disputed both the dollar figure and the premise, saying federal law blocks most Medicaid coverage for undocumented immigrants and no evidence supports spending on that scale.
Legal framework and what federal Medicaid covers
Under federal law, undocumented immigrants are not eligible for federally funded Medicaid, except for emergency care required under the Emergency Medical Treatment and Labor Act (EMTALA).
This narrow emergency coverage—often called Emergency Medicaid—pays hospitals for stabilizing treatment when a person faces a medical emergency.
Key points:
– Emergency Medicaid covers only emergency stabilization care, not routine, preventive, or long-term care.
– Hospitals are required to provide emergency care regardless of immigration status under EMTALA.
– States may elect to use state funds to cover additional services for undocumented residents, but those benefits are not federal Medicaid.
The federal rules are explained on Medicaid.gov, which outlines who can receive federal Medicaid and what emergency services are allowed.
The disputed $1 billion claim
Oz’s post did not name the five states or describe the audit beyond the $1 billion figure. Health policy analysts said that number is misleading and lacks a clear source.
- In states with large undocumented populations, federal Medicaid spending on emergency services for undocumented immigrants is typically a small share of overall Medicaid costs—often under 1%.
- The vast majority of Medicaid funds go to U.S. citizens and lawfully present immigrants who meet eligibility rules.
- Multiple state health departments reported that CMS officials privately acknowledged an error behind the claim.
States noted that the claim appeared to conflate state-funded programs with federal Medicaid dollars—an important distinction that can dramatically change the interpretation of spending figures.
State programs vs. federal Medicaid
Many states operate separate programs for undocumented residents using state budgets or special funds. Examples include:
– Prenatal care programs paid with state dollars
– Targeted services for public health or humanitarian reasons
These state-funded expenditures:
– Are reported separately from federal Medicaid
– Should not be labeled as federal Medicaid spending
When state-only programs are mixed into federal figures, experts warned it can inflate totals and lead to false impressions of misuse of federal money. VisaVerge.com notes that the Congressional Budget Office (CBO) has consistently found undocumented immigrants are not eligible for federal Medicaid, and its analyses do not support a federal path for the kind of large-scale coverage Oz suggested.
Confusion in public messaging and earlier examples
The White House earlier contributed to confusion with a “Mythbuster” fact sheet that claimed 1.4 million undocumented immigrants would be removed from Medicaid under a House bill. Experts debunked that figure, explaining those people were enrolled in state-funded programs, not federal Medicaid. The CBO’s analysis reinforces that federal Medicaid is limited to emergency services for undocumented immigrants.
Any large number tied to federal disenrollment or alleged misuse must be treated with care; audits and claims should clearly separate federal from state spending.
CMS response and planned oversight steps
In response to the controversy, CMS said it will increase oversight to ensure states do not use federal Medicaid funds for ineligible individuals. The agency’s statement:
– Did not provide proof of widespread illegal spending
– Did not endorse Oz’s $1 billion figure
– Outlined steps to:
1. Review enrollment data
2. Remind states of federal eligibility rules
3. Verify that Emergency Medicaid claims meet federal standards
Officials said the goal is to preserve program integrity while ensuring hospitals are paid for required emergency stabilization care.
Hospitals, EMTALA, and what emergency Medicaid actually covers
Hospitals operate under EMTALA, which requires emergency departments to assess and stabilize anyone who arrives, regardless of insurance or immigration status. Emergency Medicaid:
– Helps offset mandatory costs for stabilizing patients
– Is narrow and time-limited
– Does not cover follow-up care, chronic treatment, or ongoing prescriptions
Implications for families:
– In mixed-status families, a citizen child may qualify for full Medicaid while a noncitizen parent only has emergency coverage.
– Precise language about “Medicaid funds” matters because broad claims can mislead the public about who receives which services.
Political and communication stakes
Immigration and health spending are politically charged topics. Terms like “illegal immigrants” intensify public reaction.
Experts warned:
– Reducing complex eligibility rules to a single alarming figure can fuel confusion and stigma.
– CMS should release clear, public documentation when referencing audits or oversight findings.
– Reports must distinguish federal dollars from state funding to avoid misunderstanding.
State reactions and controls
Some state officials reported informal outreach from CMS acknowledging errors tied to the claim and expect formal clarifications. States emphasized:
– Medicaid agencies already run multiple checks to prevent enrolling ineligible people.
– Emergency Medicaid is restricted to cases that meet federal definitions.
– They welcome technical assistance to improve data integrity, but do not accept that federal Medicaid dollars were flowing at the scale Oz described.
As one summary of state response: “Terrifying reality does not match the numbers they see in their budgets.”
Researchers’ perspective and the final takeaway
Researchers caution that lumping state-only costs into a federal figure:
– Distorts scale and intent of state programs
– Confuses the public about what the federal government actually pays for
For families and providers, the practical takeaway is clear:
– Federal Medicaid cannot pay for broad health coverage for undocumented immigrants; it pays only for emergencies as defined by law.
– States can and do choose to spend their own money on additional services (e.g., prenatal care), but those are state decisions and state dollars.
Until CMS releases detailed, verifiable audit data, experts say the $1 billion number should not be treated as fact.
Advocates urge CMS to publish a formal correction if the claim stemmed from an internal mistake, and to provide a plain-language summary of any oversight steps so the public can see how eligibility rules are enforced without fear or confusion.
The law is settled, the CBO’s position is clear, and states report their books do not show what Oz described. The bottom line: emergency coverage is allowed; sweeping federal Medicaid benefits for undocumented immigrants are not.
This Article in a Nutshell
CMS Administrator Mehmet Oz claimed on October 31, 2025 that over $1 billion in federal Medicaid funds went to undocumented immigrants. States, researchers and analysts disputed the number and its basis, noting federal law limits undocumented immigrants to Emergency Medicaid under EMTALA and that many state programs use state funds. CMS said it will increase oversight, review enrollment data, and remind states of eligibility rules. Experts urge CMS to publish verifiable audit data and clearly separate federal from state spending to avoid public confusion.
