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ST. PAUL, Minn. (FOX 9) - Gov. Tim Walz is expected to announce major changes to the Department of Human Services at a news conference on Tuesday as the state works to respond to fraud in its Medicaid programs.
Governor's proposal for agency transformation
What we know:
Gov. Walz plans to introduce a proposal aimed at transforming the Department of Human Services to strengthen program integrity and improve service delivery to Minnesotans.
The news conference is slated to be held at 11:45 a.m. FOX 9 will stream it in the live player above and on our YouTube channel.
The backstory:
The proposal comes days after Governor Walz faced questioning during a Congressional hearing last week. That same day, Congressional leaders released a report that looked at Minnesota's fraud situation, including the circumstances around the state resuming funding for Feeding our Future after first suspecting fraud in 2021.
In recent weeks, state Program Integrity Director Tim O'Malley also released a comprehensive report looking at the state fraud problem that found failures dating back decades. In the report, O'Malley included statements from former Department of Human Services workers who said directors put "compassion over compliance" when it came to fraud oversight.
Last month, Gov. Walz also proposed his plan to combat fraud in Minnesota, which included expanding audits, increasing the use of analytical and machine learning techniques to identify fraud, and increasing penalties for violators.
Big picture view:
The Minnesota Department of Human Services has identified 14 Medicaid programs as high risk for fraud. In response, the department has begun freezing enrollment and reviewing payments to address these concerns.
In December, federal prosecutors estimated half or more of the $18 billion in payments made by those 14 Medicaid programs since 2018 could be fraudulent. State leaders have highly contested those estimates, saying, at this point, the state is not aware of fraud at anywhere near that magnitude. Still, state leaders have acted aggressively to address the fraud risks.
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Gov. Walz to outline plan to 'transform' DHS
Gov. Walz is set to detail his plan to transform the Department of Human Services on Tuesday.
Federal funding at risk
What they're saying:
The Trump administration has also responded aggressively to the fraud concerns, using fraud as a motive for the recent ICE surge in Minnesota. The administration has also threatened to withhold billions in Medicaid funding unless the state makes necessary changes to reduce the risk of fraud.
What we don't know:
The specific details of Gov. Walz's proposal are not yet available ahead of the governor's news conference and how it will address the identified high-risk programs have not been fully disclosed.