Attorney general says agency failed to report suspected foreign enrollment fraud as scrutiny of Oklahoma’s Medicaid program continues during leadership transition.
OKLAHOMA CITY — Attorney General Gentner Drummond has opened an investigation into the Oklahoma Health Care Authority’s handling of an alleged foreign enrollment fraud scheme, adding another chapter to the ongoing debate over oversight of Oklahoma’s Medicaid program as the agency undergoes a leadership transition.
Fraud investigation announced
The Health Care Authority announced Thursday that it believes a foreign crime ring fraudulently enrolled numerous Oklahomans in SoonerCare, the state’s Medicaid program, by exploiting personal information obtained through an out-of-state data breach.
Interim Director Aaron Morris said the activity was detected early, limiting fraudulent use and resulting in no taxpayer losses.
“We caught the problem early enough to minimize fraudulent usage and ensure there was no cost to taxpayers,” Morris said.
OHCA spokeswoman Rebecca Sheppard told The Oklahoman the agency would not disclose how many fraudulent enrollments were identified because the investigation remains active. She also said the scheme exploited data exposed in an out-of-state system.
Neither OHCA nor the Attorney General’s Office has alleged that eligible SoonerCare members lost benefits or experienced disruptions in coverage as a result of the suspected fraud.
Questions over reporting
Within hours of the announcement, Drummond said his office had launched an investigation into OHCA’s handling of the matter, arguing the agency failed to notify the Attorney General’s Medicaid Fraud Control Unit despite what he described as thousands of fraudulent Medicaid enrollments.
“Medicaid exists to protect Oklahoma’s most vulnerable residents, not to become a target for international fraud rings,” Drummond said. “When my office is not notified in a timely manner that thousands of fraudulent accounts were opened inside our state’s Medicaid program by foreign actors, that’s not a paperwork failure. It’s a breakdown in OHCA administration.”
Drummond’s office contends Oklahoma’s managed care reporting structure requires suspected fraud to be reported first to OHCA’s Program Integrity Unit, which then determines whether to refer cases to the attorney general’s Medicaid Fraud Control Unit. According to the attorney general’s office, OHCA originated only two of the Medicaid Fraud Control Unit’s 168 fraud referrals during fiscal year 2025.
OHCA has not publicly responded to Drummond’s allegation that his office was not notified.
Leadership transition
The disclosure came one day after Gov. Kevin Stitt announced the resignation of OHCA Chief Executive Officer Clay Bullard, who had served as CEO since October 2025. Stitt named State Chief Financial Officer Aaron Morris as interim director while a permanent leader is selected.
Managed care remains under scrutiny
The investigation is the latest challenge for an agency that has spent much of the past year facing questions about its finances, hospital reimbursement policies and implementation of SoonerSelect, Oklahoma’s managed care system that administers health benefits for many SoonerCare members.
Earlier this month, lawmakers and hospital leaders questioned a federal Medicaid filing that appeared to reduce payments under one hospital reimbursement program by about $218 million. Agency officials maintained hospitals would not see an overall reduction in Medicaid funding, while Bullard reportedly acknowledged the agency had “done a terrible job of communicating” the changes.
The latest dispute also extends a broader political debate over SoonerSelect. Gov. Kevin Stitt has defended the managed care model as a way to improve accountability and care coordination, while lawmakers, hospitals, providers and Drummond have raised concerns over implementation, provider payments and oversight. In May, Stitt and Drummond publicly clashed over competing Medicaid audit efforts, with each accusing the other of undermining accountability.
According to OHCA, the suspected fraud was first identified by the state’s managed care organizations, which notified agency officials. Morris said the agency is continuing to work with state and federal partners to investigate the case and strengthen enrollment safeguards.
The Health Care Authority has not disclosed when the suspected fraud was first detected or whether any arrests have been made, citing the ongoing investigation.
