Medicaid is health coverage — but the administration used it as a deportation tool. In January 2026, the Centers for Medicare and Medicaid Services (CMS) transferred Medicaid records to ICE that exceeded what a federal court authorized, including data on U.S. citizens and legal immigrants. ICE then shared that data with Palantir, the $315-billion data-analytics firm. Palantir runs an app called ELITE that surfaces home addresses for deportation operations. U.S. District Judge Vince Chhabria paused all CMS-to-ICE data sharing in May after the violations surfaced. On July 17, more than 20 Democratic attorneys general filed a motion disclosing that ICE personnel had asked Palantir to delete the file via a Teams chat. The same day, the Department of Justice asked the court to expand ICE's data access to cover nearly all noncitizens who aren't permanent residents or citizens. Judge Chhabria set a hearing for August.

1. The Data Transfer Broke the Court Order (20+ Democratic AGs, California Deputy AG Anna Rich)

The administration violated the court order twice, and can't prove the data was ever properly purged.

The government broke the rules twice, not once. CMS sent data on U.S. citizens and legal immigrants in January — groups the court explicitly excluded. Then, when DOJ tried to share data from non-plaintiff states, CMS accidentally reshared the same improperly obtained dataset a second time.

Palantir's "deletion" was a Teams chat message. California Deputy AG Anna Rich's declaration describes the administration's answer to how it ensured Palantir purged the records: ICE personnel sent a chat message asking Palantir to delete the file. A redacted transcript shows the request. There was no verification process, no audit, no confirmation of what actually happened to the data.

T-MSIS, the underlying CMS database, can't prevent these errors. It can't reliably separate undocumented immigrants from people with legal status in the "emergency Medicaid services" category, so any data transfer risks sweeping in people the court said to protect. The AGs argue this makes expanding access actively reckless: "ICE's inability to identify Medicaid records in its possession undercuts any claim that the agency should be entitled to more access to that data."

2. But the DOJ Wants Broader Access (Department of Justice / ICE)

The administration says the January errors were accidental, it corrected them, and the court's current limits are too narrow for enforcement.

ICE needs addresses to do its job. The court-approved data — name, address, date of birth, immigration status — is the information ICE says it needs to find people with active removal orders. The agency's mandate is identifying and locating noncitizens without legal status.

The DOJ says the over-transfers were inadvertent and fixed. Officials characterized the January violations as mistakes, not intentional policy. The government said Palantir deleted the data after the Teams chat request.

The administration wants to expand the scope. The DOJ is asking Judge Chhabria to allow data sharing for all noncitizens without permanent legal status — a significantly larger population than undocumented immigrants alone. The administration argues the court's current categories are too narrow for effective enforcement.

3. ELITE Does Neighborhood Sweeps, Though (EFF, ACLU, Mijente)

Whatever data ICE holds, ELITE turns it into a neighborhood sweep tool — and no court order changes that.

ELITE lets agents map entire neighborhoods for raids. In sworn testimony in an Oregon case, an ICE Fugitive Operations Unit officer described selecting "target-rich areas" using ELITE's Geospatial Lead Sourcing Tab — letting agents draw a shape around a neighborhood and pull up dossiers on anyone with any immigration record in the system.

The arrests don't match Palantir's stated purpose. Palantir says ELITE targets specific people with final removal orders or serious criminal charges. But nearly one in five ICE arrests enabled by Palantir tools involves a Latinx person with no criminal history or removal order at all. EFF's Executive Director Cindy Cohn argues that Palantir's legal-compliance framing hides what the tool actually does in the field.

Immigrants are already staying away from clinics. More than 86,000 immigrants without legal status left Medi-Cal or lost coverage in the first two months of 2026 — at a rate six times higher than other enrollees. At St. John's Community Health in Los Angeles, nearly one in three patients missed appointments during immigration raids. Fifty-one percent of immigrant adults now worry about health officials sharing their data with immigration authorities, and 14% have already avoided medical care because of it. Even the records the court approved ICE to access feed into ELITE — the same tool driving these numbers.

Where This Lands

The state AGs argue the administration violated the court order twice, hasn't shown it can track what it shares, and shouldn't get more access. The DOJ says the violations were accidental, corrected, and that enforcement genuinely requires the data — ideally more of it. Civil liberties groups say the legal fight is too narrow: ELITE turns any Medicaid data into a neighborhood sweep tool, not a targeted enforcement tool, and a tighter court order won't change how the app works. Judge Chhabria's August hearing will determine what ICE can hold, on whom, and for how long.

Sources