Report highlights vulnerabilities in Minnesota Medicaid programs

“New report . . . on vulnerabilities in Medicaid programs shows that DHS was not following basic internal controls that taxpayers expect,” Robbins said on social media.

The vulnerability assessment was conducted by Optum State Government Solutions, a health care technology company, for the Minnesota Department of Human Services and Minnesota IT Services.

It examined potential vulnerabilities for fraud, waste and abuse in 14 human services programs that Minnesota itself identified as high risk.

The report found a number of widespread issues throughout the programs it examined, including lack or coordination across providers, undefined eligibility criteria, and services provided without authorization.

It laid out a number of recommendations for both the departments and the state Legislature to consider, including a call for DHS to establish better organizational structures and training to identify fraud before it even happens.

“DHS should develop an organizational structure to support its program integrity office and the detection of possible fraud, waste, and abuse,” the report said. “DHS policies should be designed or clarified so that fraud, waste, abuse, and other noncompliance with law can be identified before losses occur.”

It also called on Minnesota departments to:

• Encourage providers to coordinate services

• Consolidate information needed to approve claims into one data system

• Not authorize ineligible services or services beyond benefit limits

In addition to Optum’s recommendations, the Office of the Legislative Auditor also provides its own recommendations.

The office said it did not independently verify Optum’s findings.

“Instead, we aim to strengthen legislative oversight by providing the legislature with a summary of the assessment’s contents while also protecting not public data,” the OLA said in the report.

Its recommendations include conducting regular fraud risk assessments tailored to each Medicaid program, ensuring DHS has the staffing and technical tools necessary to proactively detect “emerging patterns” of fraud, waste and abuse, and developing systems to facilitate greater data sharing between the state and providers.

Notably, the auditor’s office raised concerns about duplicate services, undefined benefit limits and suspicious billing patterns.

This comes as federal officials have increased scrutiny amid reports of widespread fraud in Minnesota’s taxpayer-funded public assistance programs. According to federal prosecutors, an estimated $9 billion has gone to fraud from the high-risk Medicaid programs in Minnesota since 2018.