<body><div><img src="https://img.particlenews.com/image.php?type=thumbnail_580x000&amp;url=2VLct3_0zknzhfx00" alt="https://img.particlenews.com/image.php?url=2VLct3_0zknzhfx00" width="1920" height="1080" >ST PAUL, Minn. — Minnesota’s new Fraud Prevention and State Agency Oversight Policy Committee questioned the Department of Human Services (DHS) leadership Monday about fraud on the agency’s watch. The committee, made up of five GOP members and three DFL members, is focused on a stricter approach to tackling fraud in the state. During the hearing, multiple KARE 11 investigations into addiction treatment centers were flagged, highlighting past failures in DHS’ oversight duty. DHS came to the table with proposals to address limitations in its current powers and ramp-up the crack-down on Medicaid fraud. “Fraud against these public programs is unacceptable,” said DHS Acting Commissioner Shireen Gandi. <h2>'We Kept Paying Them!' </h2>KARE’s multi-year “Recovery Inc.” investigations exposed how DHS approved tens of millions of dollars in questionable Medicaid payments to addiction treatment providers — without adequate oversight. At the hearing Monday, Rep. Marion Rarrick (R – Maple Lake) and other lawmakers cited KARE’s reporting on treatment providers like Evergreen Recovery, NUWAY and the Refocus Recovery/Kyros partnership, where KARE 11 found DHS allowed millions of dollars to go out the door after red flags were raised. “I find this stunning. Kyros’s lawyer threatened to sue the state and Commissioner Harpstead personally granted a certification so they could keep billing Medicaid,” said Committee Chair Kristin Robbins (R – Maple Grove) adding, “We kept paying them!” Refocus Recovery received millions of dollars in additional payments before DHS suspended payments in September of 2024 citing credible allegations of fraud.Rep. Robbins asked the acting DHS Commissioner for assurances situations like that were no longer occurring. “I cannot speak for past situations that I was not intimately involved in,” Gandi responded. <h2>Anti-fraud Proposals </h2>DHS cited limitations within its current authority to issue a payment withhold— an action where the state cuts off funding to a provider. New proposals would expand payment withholds to circumstances beyond an active or pending investigation, including a criminal conviction related to fraud involving another state or federal agency, credible allegations of fraud permitted by federal law, when a license is revoked by a state or federal agency, and in the event of a background study disqualification. State data shows in 2024, 151 Medicaid payment withholds were conducted by DHS. This year, a KARE 11 Investigation revealed a threatened DHS payment withhold affecting NUWAY, an addiction treatment nonprofit. In February, DHS temporarily cut off payment to the provider, citing findings of credible allegations of fraud. Though the state was ultimately allowed to suspend payment, NUWAY initially fought the funding freeze in court, arguing in part that DHS had not provided forthcoming information about its investigation or reason for the cutoff. DHS’ new proposal adds changes to expand its authority to be more transparent about payment withhold information. <h2>Kickback Statute </h2>DHS also argued that state-specific carve-outs are needed to tackle kickback allegations — when a provider uses an incentive to receive Medicaid-funded services. According to DHS Acting Commissioner Gandi, 36 states have specific laws making kickbacks illegal, but Minnesota isn’t one of them. When federal authorities raided Evergreen Recovery in St. Paul last summer following KARE 11’s reports of billing irregularities, the criminal indictment also alleged that Evergreen provided “illegal kickbacks” by “providing free housing in exchange for attendance at treatment services.” While kickbacks are federally outlawed, DHS asserted there are gaps in the current state law which prohibits them from taking action if no other types of fraud is found. Rep. Robbins said she is in the process of drafting a bill to expressly forbid kickbacks in Minnesota. <h2>Legislation Introduced </h2>The Minnesota Attorney General’s office also announced the Medical Assistance Protection or “MAP” Act, a bipartisan bill to expand their investigative bandwidth into Medicaid fraud. The bill — introduced by Attorney General Keith Ellison, Sen. Ann Johnson Stewart (DFL - Minnetonka), and Rep. Matt Norris (DFL - Blaine) — would increase the size of the Medicaid Fraud Control Unit, add subpoena powers, and increase sentencing penalties. “Medicaid fraud isn’t only illegal. It is also immoral and reprehensible,” Attorney General Ellison said. The MAP Act aims to account for the recent increases to the state’s almost $20 billion Medicaid budget by adding 9 members to the Medicaid Fraud Control Unit — upping the staff count from 32 to 41. “Medical assistance fraud steals from hardworking taxpayers across the state, and it also steals money that was intended to provide healthcare to low-income Minnesotans” said Rep Norris. “That’s disgraceful and we’re here today to help crack down on that type of fraud.” Under the current provision, the Attorney General’s Office does not have subpoena power to access certain financial records during a provider fraud investigation. The MAP Act changes that and would expand the Attorney General’s Office’s subpoena power to the same level as county attorneys. “Bad actors who steal funds designated to provide healthcare to some of the most vulnerable Minnesotans must be held accountable,” Sen. Johnson Stewart said. “This is something we all agree on, so let’s get it done.” Currently, the law caps the maximum prison sentence at 2.5 years, regardless of the amount of fraud uncovered. “Right now, someone can steal millions in Medicaid... and the maximum penalty would be the same as if they stole a flat screen tv,” Attorney General Ellison said. That's because the state classifies Medical Assistance fraud as an attempted theft, rather than a completed theft. Changes under the MAP Act would increase the maximum penalty to up to 20 years in prison, and up to a $100,000 fine for $35,000 or more in theft. </div></body>

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ST PAUL, Minn. — Minnesota’s new Fraud Prevention and State Agency Oversight Policy Committee questioned the Department of Human Services (DHS) leadership Monday about fraud on the agency’s watch. The committee, made up of five GOP members and three DFL members, is focused on a stricter approach to tackling fraud in the state.

KARE 11 Investigates: 'Unacceptable and immoral' – push for tougher penalties for Medicaid thieves

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ST PAUL, Minn. — Minnesota’s new Fraud Prevention and State Agency Oversight Policy Committee questioned the Department of Human Services (DHS) leadership 

KARE 11 Investigates: 'Unacceptable and immoral' – push for tougher penalties for Medicaid thieves

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