Washington, May 14 : Vice President J.D. Vance announced a sweeping crackdown on alleged Medicaid and Medicare fraud, accusing several Democratic-led states -- particularly California, New York and Hawaii -- of failing to police abuse in federally funded healthcare programmes.

Speaking at the White House alongside officials leading the administrationâ??s anti-fraud initiative on Wednesday (local time), Vance said the federal government would defer $1.34 billion in Medicaid reimbursements to California while demanding stronger enforcement efforts from state authorities.

â??The state of California has not taken fraud very seriously,â?? Vance said. â??We want California to get serious about this fraud.â??

Vance said the administration was also sending letters to all 50 state Medicaid programmes requiring them to demonstrate that they were â??effectively and aggressively prosecuting Medicaid fraudâ??. States failing to comply risk losing federal anti-fraud funding, he said.

â??We are gonna turn off the money that goes to these anti-fraud units,â?? he said.

The vice president repeatedly argued that fraud harmed both taxpayers and low-income Americans who rely on public healthcare programmes.

â??How long are people gonna pay into programmes if they know that that money doesnâ??t go to a low-income kid who needs healthcare, but that money goes into a fraudster getting rich,â?? Vance said.

Administrator of the Centres for Medicare and Medicaid Services, Mehmet Oz, popularly known as Dr Oz, said federal investigators had uncovered â??major red flagsâ?? in Californiaâ??s Medicaid billing records.

â??Weâ??ve discovered $630 million in billing from the folks who are egregiously the top 5 per cent of outliers in billing,â?? Oz said. â??This is numbers so big. You canâ??t imagine anyone billing for these numbers of patients and that much for each patient.â??

Oz also announced what he called the largest hospice fraud action in federal history, saying 800 hospice providers in the Los Angeles area had been suspended.

â??We believe that at least half of the hospices in the entire area around Los Angeles are fraudulent,â?? he said.

According to Oz, the suspended providers had billed the federal government nearly $1.4 billion last year.

â??800 hospices that last year charged the federal taxpayer $1.4 billion will no longer be paid,â?? he said.

The administration also imposed a nationwide moratorium on new hospice and home healthcare providers while authorities review licensing and oversight mechanisms.

Andrew Ferguson, who heads the anti-fraud task force, accused some states of turning anti-fraud programmes into â??a jobs programme for Blue State lawyersâ??.

â??It should not have taken a brave kid with a cell phone camera to point the American people at this issue,â?? Ferguson said.

Kim Brant, a senior official overseeing the Medicare fraud â??war roomâ??, said authorities had already stopped more than $2 billion in suspect payments over the past year by analysing claims before money left federal accounts.

Vance also linked fraud concerns to broader immigration and fiscal debates, alleging that undocumented immigrants were benefiting from taxpayer-funded healthcare in some states.

The Trump administration has made anti-fraud enforcement a central domestic policy theme during its second term, arguing that reducing waste and abuse could extend the life of Medicare and Medicaid trust funds. Federal officials have increasingly focused on healthcare fraud, identity theft schemes and improper benefit payments across multiple welfare programmes.

/IANS