Texas Gov. Greg Abbott targets Medicaid in new fraud investigation order

AUSTIN, Texas - Texas Gov. Greg Abbott has ordered state health officials to look into potential Medicaid fraud.

This order follows two other fraud reduction initiatives the governor recently announced. The three all have a common link.

What they're saying:

"When you saw what happened in Minnesota and the billions of dollars in fraud that was taking place, I think it would be irresponsible for state leaders not to look at their own program to make sure there was no similar fraud taking place," said Abbott during a Jan. 8 campaign stop in Houston.

The statement came from a question regarding his decision to review child support payments. 

On Friday, Abbott made a reference to Minnesota again in a letter he sent to officials with the Texas Health and Human Services Commission.

"Recently, the Trump Administration identified potential systematic fraud in certain Medicaid funded programs and services in other states. State agencies have a duty to take proactive steps to prevent fraud, waste, and abuse, to recoup inappropriately paid funds, and to hold those accountable that violate the law," stated Abbott in his Jan. 16 letter.

What we know:

Abbott’s effort to "root out" fraud is being expanded to the state’s Medicaid program.

He directed the HHSC Inspection General to assess safeguards and fraud prevention training, as well as a review of autism services. A report is due by March 15. 

The items to be reviewed, according to the Governor’s letter, include the following actions:

• Perform additional reviews of Medicaid services recently identified by the Trump Administration as susceptible to higher incidences of fraud and adjust OIG resources to investigate those suspected of fraudulent activity that are not already under review;
• Ensure that all Medicaid Managed Care Organizations (MCO) have fully staffed Special Investigations Units (SIUs) and are completing mandatory investigative activities, as required by law, to root out fraud;
• Provide additional training to the MCO SIUs to enhance their capacity to prevent, detect, and eliminate fraud, waste, and abuse in the Medicaid program;
• Perform additional targeted reviews of MCO policies for the Medicaid services most susceptible to fraud, waste, and abuse;
• Complete a targeted utilization review of autism services and provide a report in June 2026; and
• Highlight the availability of the OIG online fraud reporting portal and hotline to allow Texans to report potential instances of fraud in the Texas Medicaid program.

Dig deeper:

Political analyst Brian Smith, with St. Edward's University, spoke to FOX7 about Abbott’s fraud hunt.

"A lot of this is Glass House and a lot of it's that he's throwing stones. So, if he's going to go after other states, democratic states yelling about waste, he's got to get his own house in order.

Ordering fraud investigations now, according to Smith, allows Abbott to get ahead of a political hot topic that’s making headlines nationally.

"And right now we know fraud is a great issue to run on. Bringing down the Governor of Minnesota. And so, if he's able to say there's a lot of fraud in Texas and it's committed by these democratically aligned groups, then it's a political winner," said Smith.

The reviews could become a campaign issue for Abbott.

"It's definitely a campaign issue and it's a good campaign issue. There's a lot of political gain in going after wasteful spending. We all think government takes money and wastes money. And it's also a bipartisan issue when it involves fraud. So this is an issue that if he does find fraud, the Democrats can't complain about the Republicans will love and independence will be happy," said Smith.

Abbott has been the Governor of Texas for more than a decade and the reviews could backfire. However, Smith said accusations of being asleep at the wheel could be flipped by Abbott.

"If we find that the state of Texas is the one committing the fraud, then he's going to have to take a lot of the responsibility. But if we see it's coming from other areas, which is highly probable, then he's going to be able to blame those areas," said Smith.

At a campaign event, Abbott noted the state has fraud prevention programs in place now, but he wants to redouble those efforts and ramp them up if necessary. Abbott has also contacted officials in the Trump administration about volunteering Texas to participate in a federal fraud review.  

HUD reportedly is launching a pilot program designed to eliminate fraud in the government's affordable housing programs.