Trump Holds Hostage $1 Billion in Medicaid Funds

Trump's brokers got rich off private prison stock as ICE deaths hit a record, the CDC detained 13 Americans with no Ebola exposure, and the Army cut lawyers for wounded soldiers

Good afternoon. I’m Ryan Rose, and this is AlterNet America.

The Trump administration froze more than $1 billion in Medicaid payments to California and Minnesota over fraud claims it hasn’t substantiated. Trump’s brokers have made 29 trades of private prison stock since he took office, as both companies posted record profits off his immigration policy. The CDC detained 13 U.S. citizens with no Ebola exposure at Fort Drum for an entire weekend. And the Army has stopped providing free legal help to Guard and Reserve soldiers facing medical discharge, right at the stage where their fate is decided.

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Trump Pauses Medicaid Funds to Blue States

Dr. Oz spent years telling daytime TV audiences to trust their gut. Now he’s using his to slash entire states’ Medicaid programs.

On Tuesday, the Trump administration paused more than $1 billion in Medicaid payments to California and Minnesota. Kennedy said the money would not be reversed until the two Democratic-led states “demonstrate that every dollar meets federal requirements.”

The Centers for Medicare & Medicaid Services will defer approximately $867.5 million in federal payments to California and $199 million to Minnesota. HHS billed the moratorium as an effort to combat “fraud, waste, and abuse.”

Kennedy named Govs. Gavin Newsom and Tim Walz personally, both longtime Trump targets. “All they have to do is provide basic documentation showing that these services are legitimate and not fraudulent,” he said. “That’s common sense.”

CMS Administrator Mehmet Oz said the states had turned up “claims that smell like fraud.” He did not provide any evidence of fraud. In fairness, Dr. Oz has always been better at sniffing out miracle cures than actual evidence.

Trump Bought Private Prison Stock as ICE Rampaged

It turns out the secret to a good investment is being the guy who decides which companies get $2 billion in federal contracts.

Since returning to office, Trump’s brokers have made 29 trades of private prison stock. The first purchases came on the tenth day of his second term. He traded every month of 2025 except August and December, moving between $281,029 and $990,000 across two companies: GEO Group and CoreCivic.

The timing was tidy. In February 2025, CoreCivic’s CEO told investors he expected Trump’s immigration policies to bring “the most significant growth in our company’s history.” GEO Group’s executive chairman called it “an unprecedented opportunity.” That same month, Trump made seven purchases of their stock.

They were right. GEO Group now holds over $2 billion in ICE contracts and reported more than $250 million in profit for 2025, a nearly 700% jump over the year before. CoreCivic grew its net income by nearly 70% to $116.5 million and secured over $650 million in new ICE obligations.

The overlap runs deeper than a stock ticker. Trump named a former GEO Group executive as acting head of ICE. His border czar was a paid GEO Group consultant. His attorney general lobbied for the company. GEO Group was the first corporate PAC to max out to Trump’s campaign.

The companies had their most profitable year ever. It was also the deadliest year on record for people held in ICE custody. The president made money on both. That sentence doesn’t show up on cable news, because cable news has advertisers who do business with the federal government. We don’t. Become a paid subscriber today.

The CDC Detained 13 Uninfected Americans Over Ebola

Thirteen Americans walked into Canada. None of them caught Ebola. All of them got detained.

Shortly after 1 a.m. on Friday, July 17, Dr. Jay Bhattacharya — nominally running the CDC while also running the NIH — authorized the apprehension and detention of 13 U.S. citizens who had crossed the border by land from Canada. They were taken to Fort Drum in northern New York and held through the weekend, released Monday morning.

They came from Texas, New York, Colorado, Vermont, Connecticut, New Hampshire, and Massachusetts. One Massachusetts family with small children had been trapped at the border for roughly 30 hours, passports seized, given little food and scant information.

CDC clinicians had already assessed all of them and found none had high-risk exposure for ebola. Most had only been in Kinshasa, over 1,000 miles from the outbreak in Ituri province. Agency staff even drew Bhattacharya a map showing the distance.

He ordered them detained anyway.

A CDC employee called it a “wild misuse” of power. The regulation invoked, 42 CFR § 70.6, lets the CDC apprehend anyone “reasonably believed” to be infected. The people it was used on had been medically cleared by the CDC’s own doctors.

The staff even drew a map to prove there was no risk. To be fair, nobody confirmed he can read a map.

The Army Cut Lawyers for Wounded Soldiers

The Pentagon has plenty of lawyers for soldiers. So long as the soldiers are guarding the border, not recovering from injuries.

According to a May 27 Army memo, the Office of Soldiers’ Counsel has taken “dramatic cuts to its authorized positions over the past 12 months.” As of July 1, it stopped providing all legal services to non-active-duty Guard and Reserve soldiers.

The office’s own scheduling site now says it is “unable to assist” soldiers at the Medical Evaluation Board stage — the stage where a soldier’s medical record is actually assembled and their disability rating starts to take shape.

That rating decides everything. A soldier can be separated with severance pay, or placed on the Permanent Disability Retired List with retired pay and Tricare for their family. “When a service member waives their rights or accepts lower amounts of disability than they’re entitled to, that can be a very costly error,” said Dan Conway, a former Marine Corps judge.

The context isn’t subtle. In March, Pete Hegseth ordered a “ruthless, no-excuses review” of military legal offices. Meanwhile, the Pentagon approved transferring up to 600 attorneys to the Justice Department to serve as immigration judges, and Hegseth ordered 48 more sent to Memphis and the southern border.

Support the troops, unless the troops need lawyers.

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POSITIVE STORIES YOU MAY HAVE MISSED:

A Texas CBP Officer Was Indicted for Falsifying a Report. A Customs and Border Protection officer in El Paso has been indicted for falsifying an official report after he allegedly put a detainee in a chokehold in 2021, injured the person, and then told his supervisor the detainee started it. That story got the incident filed as an assault on a federal officer instead of a federal officer assaulting someone. The officer now faces one count of deprivation of rights under color of law and one count of making false statements to a government agency, carrying a combined maximum of 15 years. The indictment marks a rare instance of federal accountability reaching an agency that has spent this year mostly making headlines for the opposite.

Sen. Andy Kim Rolls Out a MediKids Proposal. Sen. Andy Kim of New Jersey has introduced the MediKids Act, a proposal that would automatically enroll every child in the country into Medicare at birth and keep them covered until age 26, addressing the roughly 4.6 million American children who currently have no health insurance at all and the 23 million more who are underinsured. The plan arrives in the same week the Trump administration froze a billion dollars in existing Medicaid payments and in the same year congressional Republicans passed a budget that cut Medicaid further to fund tax breaks, offering a rare glimpse of a lawmaker trying to add coverage rather than subtract it.

Teachers Disciplined Over a High School Drag Show Win a $150K Settlement. Three teachers in Iowa’s Ankeny Community School District have won a $150,000 settlement after the district disciplined them for their involvement in a 2022 student drag show that, by all accounts from the parents and students who actually attended, contained nothing sexually explicit or obscene. The trouble started when Libs of TikTok amplified the event. The district responded to the right-wing pressure by calling the show “unauthorized,” placing all three teachers on leave, suspending two of them, banning all three from sponsoring student activities, and filing ethics charges that were ultimately dismissed.

A Washington Judge Halted Kalshi’s Betting Operation. A King County Superior Court judge granted a preliminary injunction Monday against Kalshi, ruling the popular “prediction market” likely violates Washington’s gambling laws. Attorney General Nick Brown sued in March, arguing the platform — which took in a reported $40 billion in World Cup bets and lets users wager on elections, measles case counts, and testimony in a child trafficking hearing — is simply online gambling by another name. Judge John McHale cited a Kalshi ad showing a text that read, “I found a way to bet on the NFL even though we live in Washington,” and found the company “willfully ignored” a state gambling commission notice.