Thousands of Californians unable to feed, bathe and dress themselves have struggled to find caregivers, prompting the state to swell its in-home care program.
That effort is now being thrown back in its face.
The Trump administration is citing the rapid growth of California’s in-home services as evidence of fraud, withholding more money from it than any other single health program in the country.
The administration has paused $2.2 billion in Medicaid funds to the state, most of that — $1.7 billion — for California’s In-Home Supportive Services, putting the program at risk for cuts. The funds are being held as part of the administration’s high-profile crusade against fraud in federal safety net programs, led by Vice President JD Vance.
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California officials say there’s no evidence the state’s personal-care program, among the nation’s most generous, has especially high levels of fraud. They fear the Trump administration is undermining the community-based approach Democrats and Republicans have supported for decades.
“If CMS is able to point out strong or major fraud concerns, we’d be happy to know about it,” said California Medicaid Director Tyler Sadwith. “Unfortunately, they haven’t done that.”
California’s expansion effort began in 2021 when the state’s auditor identified a crucial flaw in the program that pays family members and caregivers to assist more than 900,000 disabled and elderly Californians with their daily personal care.
“You feel stuck,” Ligia Andrade Zúñiga, a 47-year-old disabled San Mateo resident, told NOTUS of life without a caregiver. “The four walls of your room become like a jail.”
A 2009 car accident paralyzed Zúñiga from the chest down. Since then, she has struggled for years at a time to find a consistent caregiver. She didn’t like asking her elderly mother to help her get out of bed, use the bathroom, brush her teeth and eat breakfast — but sometimes she had to. It strained their relationship, and she felt isolated, depressed and fought thoughts of self-harm.
“One of the biggest issues in this space over the past 10 years has been lack of caregivers and not sufficient services to meet demand,” Damon Terzaghi, vice president for Medicaid and home care policy at the National Alliance for Care at Home, a membership organization that represents providers.
But to Vance’s anti-fraud task force — which has deferred unprecedented sums of Medicaid payments to California and Minnesota this year — California’s expansion appears nefarious.
Dr. Mehmet Oz, administrator of the Centers for Medicare and Medicaid Services, told reporters in July that spending on in-home programs went up by 24% in California over the last two fiscal years, compared with 12% on average for the rest of the country.
California says it’s complying with CMS’s requests for more information as the agency evaluates its funding in a process that could take months or more to work through. CMS did not respond to requests for comment.
The anti-fraud task force has dialed up the government’s focus on scams and deceit to previously unseen levels. Vance has regularly issued dire threats against scammers who officials say have been bilking the nation’s safety net programs unchecked for years.
Everyone agrees there’s some degree of fraud in entitlement programs. States have always worked on prosecuting it, some more earnestly than others. And personal-care providers have indeed been convicted of Medicaid fraud at higher rates nationally than other types of health care workers.
Yet the administration’s anti-fraud work has taken a sharp political tack. So far, it has held up large sums only from California and Minnesota — but not Florida, home to many massive fraud schemes. Nor has it provided specific evidence for withholding so much from California’s home-care program, merely citing faster growth in California’s program compared to other states, as well as “statistical anomalies” in the state’s data.
Vance and other Cabinet members in the task force trumpet their largely blue-state-focused efforts ahead of the midterm elections, insisting prosecution has been insufficient and promising to root out fraud once and for all.
“We’ve got a party that is fighting for fraud, and a party that is fighting against fraud,” Vance told an audience in Milwaukee in early July. “When you come to vote in November, are you going to vote for the pro-fraud party?”
While it’s normal for the Centers for Medicare and Medicaid Services to temporarily pause some Medicaid payments to states to double-check receipts, administrations have never deferred so much money for entire categories of services, experts say.
Public health administrators are also taken aback by the administration’s targeting of home health services, fearing the Trump administration is undermining policies federal and state lawmakers have prioritized for nearly 50 years.
Former President Ronald Reagan signed a law in 1981 that pushed people from institutional care to home services, as the public health community settled on home care as the more humane and less expensive approach. In 1999, the Supreme Court found that unnecessarily institutionalizing people with disabilities is illegal discrimination under the Americans with Disabilities Act. The federal government has long interpreted that decision as requiring states to offer home- and community-based services in most cases.
Now, the Trump administration is reconsidering that legal mandate.
Earlier this summer, the Justice Department said it won’t enforce its own guidance implementing that Supreme Court decision as it writes new guidelines. It also released a memo calling into question how that decision about not institutionalizing people with disabilities has been interpreted for decades.
Oz has also repeatedly questioned whether the government should pay family members to care for loved ones at home.
“Personal care services: these help Medicaid patients do something that our families would normally do for us, like carrying groceries,” Oz said in a social media video in March about a CMS probe focused on New York, adding that the program is being abused.
He acknowledged at a July press conference that “done correctly, these programs could make sense.”
Hagar Dickman, an advocate for long-term services in California at the nonprofit Justice in Aging, said Oz’s comments show a misunderstanding of how personal care works. In most cases, to be eligible for In-Home Supportive Services, a patient must require around-the-clock care beyond what a typical family member with a full-time job could offer.
“The most generous interpretation of that statement is that it’s out of touch with what Americans and what Californians need financially in order to be secure in their homes,” Dickman said. “Most Californians require a two-income household.”
For the first 15 years of Amanda Andresen’s life, her mother, Rosa, didn’t know she could get paid for caring for her. Amanda’s brain lacks a critical bridge of fibers separating its left and right halves. She is 28 years old but cognitively around 15 months old.
Rosa is constantly by Amanda’s side. She keeps Amanda safe during daily seizures. She changes her diapers. She shreds Amanda’s chicken into tiny pieces that she’s able to swallow. She keeps Amanda from wandering away in the grocery store.
“From the moment she gets up, I have to help her,” Rosa told NOTUS.
After Rosa’s husband died in 2013, leaving her without income, she learned she could qualify to be paid $19.65 an hour under IHSS.
She applied, submitted to a background check and attended training. A social worker visited her home to determine how many hours of paid care Amanda qualified for. At first, Amanda was granted just two hours a day, but after Rosa appealed the decision, it was upped to roughly nine hours a day — the maximum a patient can get.
Now Rosa brings in around $5,560 a month plus smaller supplemental security income checks — enough to pay their $2,700 rent and cover living expenses with help from food stamps. To get paid, she enters her hours in an online portal. She can’t work more than 283 hours a month.
That’s unquestionably cheaper than keeping a patient in a 24-hour facility. IHSS costs Medi-Cal roughly $17,000 a year per recipient, compared to well over $100,000 for a skilled nursing facility, according to 2021 estimates by the state auditor.
“This model has been universally accepted across parties for such a long time as the most cost-effective way of providing care,” said Arnulfo De La Cruz, president of SEIU Local 2015, which represents home health workers.
Some personal-care assistants do commit fraud. States convicted far more personal-care providers last year — 326 in total — than any other type of caregiver, the Department of Health and Human Services Inspector General found. (That figure may also be influenced by the type of cases prosecutors typically pursue.)
Home health care claims were a significant part of a massive batch of prosecutions the anti-fraud task force announced in June. Nearly half of the state cases involved personal-care assistants. Missouri had the most.
In one case, St. Louis resident Patricia Busby billed Medicaid $18,278 for services she claimed to have provided to her adult daughter Christine Busby — even as both women worked as armed security guards for three- to 12-hour shifts.
Four of the cases were in California, and they all involved individuals submitting false time sheets.
Yet at times the administration has tripped up in its eagerness to claim fraud. A month after Oz accused New York of turning its home-care program into a “massive jobs program,” the administration admitted it had inaccurately claimed that nearly three-fourths of the state’s Medicaid enrollees use personal-care services. CMS had misidentified the state’s billing codes in its analyses.
Some IHSS advocates and patients worry the intense scrutiny on personal care — on top of legislation passed last year by congressional Republicans projected to reduce Medicaid spending by hundreds of billions — could make the program eligible for future cuts in California and beyond.
The impact could be immense: Medicaid funds well over half of all home care in the United States, according to KFF.
States must offer certain services in Medicaid, but personal care is optional, making it an easy target for reductions. Cuts have recently been on the table in California. Gov. Gavin Newsom’s budget proposal released earlier this year included millions of dollars worth of cuts to IHSS, drawing sharp pushback from the disability community before the reductions were ultimately rejected.
The state, like others, has already installed checks meant to prevent fraudsters from siphoning off taxpayer dollars, including unannounced home visits and data checks meant to catch bad actors. Providers have to log their work in a GPS-enabled electronic time sheet, as required by Congress in 2016.
Keeping fraudsters out of the program and eligible people who need assistance in it is a delicate balance, said Alice Burns, associate director of KFF’s Program on Medicaid and the Uninsured. Take guardrails away, and both eligible patients and bad actors may benefit. Add too many hurdles meant to trip up fraudsters, and enrollees may have a difficult time accessing care — a problem California and many other states have already faced.
Access to caregivers can be life altering. Zúñiga said she has a good rapport with her current caregiver, who arrives early in the morning to help her get ready for work; she runs a disability rights nonprofit, serves on a local governance board for in-home services and is on her local school board.
“I cannot serve my community,” she said, “without being able to get up out of my bed in the morning.”
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