Minnesota to visit thousands of providers in fraud-fighting push

The state is checking on service providers in push to rebuild trust and prevent the federal government from withholding funds.

The Minnesota Star Tribune
February 2, 2026 at 11:55PM
The Elmer L. Anderson Human Services Building on Cedar Street in St. Paul. (Jeff Wheeler/The Minnesota Star Tribune)

Minnesota state employees will re-examine thousands of Medicaid service providers in the latest effort to fight fraud and prevent the federal government from withholding critical funds.

In an “unprecedented” push, the state will be revalidating more than 5,800 organizations that are enrolled to provide services through Medicaid-funded programs identified as high-risk for fraud, Minnesota Medicaid Director John Connolly said.

“Right now we need to pull out all the stops and assure ourselves, and the people of Minnesota, that the providers of these services are qualified and eligible to carry out their work,” Connolly said during a Feb. 2 update on state efforts to combat fraud.

Federal prosecutors have said billions of dollars may have been lost to fraud in 14 high-risk social services programs, one of which has been shut down.

The revalidation process for providers in those programs includes reviews of their documentation and background studies of owners and on-site screenings.

The Minnesota Department of Human Services is attempting to assemble 168 additional staff members from across state government to help conduct the unannounced visits to providers. The agency is racing to complete all the checks by the end of May. Typically high-risk providers are revalidated at least once every three years.

The revalidations are a major part of a corrective action plan the state sent to the federal Centers for Medicare and Medicaid Services (CMS), Connolly said.

Federal officials previously said the corrective action plan the state submitted in December was inadequate.

They threatened to freeze up to $515 million in quarterly Medicaid funding to the state until Minnesota “fully and satisfactorily implements a corrective action plan” to comply with federal program integrity rules for the 14 high-risk programs.

The state has called the potential funding withhold “legally baseless.”

CMS officials gave Minnesota until Jan. 30 to revise their plan or appeal the federal move to withhold funds, and Connolly said they are doing both.

It will take months for the appeals process to play out, he said.

In the meantime, the state is moving forward with other measures, including pausing the enrollment of any new businesses in the high-risk programs.

“Even though we don’t agree with CMS’s conclusions, we are moving ahead with the recommendations they have laid out,” Connolly said.

about the writer

about the writer

Jessie Van Berkel

Reporter

Jessie Van Berkel is the Star Tribune’s social services reporter. She writes about Minnesota’s most vulnerable populations and the systems and policies that affect them. Topics she covers include disability services, mental health, addiction, poverty, elder care and child protection.

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