A Plan to Address Fraud in Minnesota
by Senator Jason Rarick
We have all seen the headlines – fraud has been plaguing our state for far too long. Unfortunately over the last few legislative sessions, there have been some serious gaps in the effort to improve oversight, technology, and accountability. As a result, it really doesn’t feel like we’ve made any headway on fraud at all. That’s why Senate Republicans kicked off the start of session with a slate of bills that offer tangible, commonsense solutions to eliminating fraud.
Our plan has 3 key goals: implementing stricter oversight measures, supporting technology to ensure services are actually being delivered to those who need them, and improving overall accountability.
It feels like a broken record to say, but stricter oversight measures are the key to stopping fraud before it begins. That’s why last year the Senate passed a bill to create an independent Office of the Inspector General (OIG). That “OIG” bill might sound familiar – it’s been in the works for quite some time. It had overwhelming bipartisan support in the senate last year, but unfortunately it stalled in the House, so it never quite made it to the finish line. We are planning to renew our efforts to get that bill passed and into law. What separates our plan from Governor Walz’s “OIG Council” is that our bill establishes the OIG as an independent office, whereas the governor’s iteration of the OIG would report directly to him. Unfortunately, in my opinion, that defeats the purpose. The Walz Administration spent years downplaying fraud allegations, and it feels irresponsible to create an OIG council to investigate fraud, if it answers to the very administration that failed to recognize it in the first place. This isn’t a partisan stance – this is commonsense. Again, the senate’s version of the OIG bill had incredible bipartisan support. There’s no reason we shouldn’t be able to get this done.
Another simple way of increasing oversight is by keeping an eye on projected and actual spending in human services programs. This is a direct response to what we saw with the Housing Stabilization Services (HSS) fraud: the program grew by more than 200% in about two years, and we then found it was riddled with fraud. The explosive growth was a clear red flag. This part of our plan would state that for any service that exceeds projected spending by 5%, an audit by the Office of the Legislative Auditor (OLA) would be triggered automatically, and if spending exceeds projections by 10%, the service would require additional review and involvement from the legislature.
For our second goal, it’s clear that using technology would help with transparency and would also ensure our most vulnerable are getting the services they need. A big contributing factor to the fraud has been businesses billing Medicaid for services they claim to be providing, while failing to actually deliver. It’s put a lot of folks in a bad spot, wondering why they aren’t receiving the care they were promised. Yet the businesses are still being reimbursed despite failing to provide the services. We need to have commonsense technology verification to cover everyone in this process. This will improve transparency, protect our most vulnerable and their access to services, and legitimize businesses.
Improving accountability is another area that must be tackled with a commonsense approach. More than anything, we need to empower whistleblowers in agencies to come forward if they see signs of fraud. Anyone brave enough to do that should be protected and supported. We also need to have follow-up on OLA findings. The OLA provides a great service and lets us know where shortcomings are, but if there is no follow-up on their recommendations, their effort is rendered useless. We should also implement unannounced in-person visits to businesses receiving taxpayer funding through DHS, because that is where the bulk of the fraud has been uncovered.
As I have said numerous times before, fraud reduction must be our top priority, due to how it adversely affects every area of our government. The fraud we’ve uncovered is going to have a long-term impact on our state and its economy unless we can get things in order. Again, these are commonsense, non-partisan solutions to prevent a measured plan for folks to get on board with. Ending the fraud crisis will take a bipartisan bicameral effort, and I am hopeful we can advance the discussion as session continues.