Minnesota’s Fraud Problem
by Senator Steve Green
Anyone watching the news can see that Minnesota is a hotbed for fraud. For every family and taxpayer, it’s frustrating. Of course, the most renowned instance of fraud in our state was the Feeding Our Future case, which amounted to around $250 million. While that’s the most well-known example, it’s not the first, and there’s been much fraud since then. It seems like it started a continuous flow of fraud.
The last time I talked about this issue, there was a new instance of fraud involving Nuway – that was in January. They were accused of using billing loopholes to get extra Medicaid payments. They overbilled to the tune of $58 million in just 3 years.
Another case that was being discussed at that time was potential fraud related to autism centers. The FBI raided two autism centers as part of an investigation into Medicaid fraud relating to autism services. Individuals reported that many kids receiving services at these centers were not autistic, and the owners of the centers were paying parents to bring children to their centers. That led to more and more of these centers popping up. More centers meant more Medicaid funding being expended. Medicaid funds paid to these centers increased from $32.4 million in 2020 to $228 million in 2024. The rapid expansion of this industry was a clear red flag, and now the fraud related to this case is estimated to be around $1.8 million. Another drop in the fraud bucket.
Yet another case of fraud just popped up in recent weeks regarding Minnesota’s Housing Stabilization Services program, which is run by the Department of Human Services. This was launched in 2020 as a way to allow Medicaid funding to be used for supporting housing-related services for people with disabilities, mental illnesses, or substance abuse disorders. It was expected to cost only $2.5 million per year. That changed rapidly… Costs ballooned immediately. $21 million in 2021, $42 million in 2022, $74 million in 2023, $104 million in 2024, and $61 million in just the first half of 2025. Now, federal agents are investigating the program. They have already claimed the program has “proved to be extremely vulnerable to fraud.” Seems like a recurring theme in our state.
What is the common theme in these cases? Fraudsters using vulnerable folks as a way to make a quick buck. It’s bad. It’s shameful. How has Minnesota cultivated a place where this is possible? Republicans have repeatedly advocated for fraud protection measures: additional oversight, grant reforms, transparency… the list goes on and on. Yet our suggestions have been repeatedly ignored by Democrats in power. It makes one question why – why are Democrats so uninterested in tackling this issue? If they cared, surely they’d support these bills, yet they don’t.
Despite our concerns, the fraud continues. Minnesotans want this under control. Acting U.S. Attorney for Minnesota, Joe Thompson, even noted that when his office’s investigations are finished, he believes the fraud in Minnesota government programs could cost over $1 billion. The previous U.S. Attorney for Minnesota also noted last year that “Minnesota has a fraud problem.” How many times should we hear this before we finally act?
The bottom line is this: consistent fraud is a reflection of poor leadership. Minnesotans pay their taxes and expect the government to be responsible in how they use that money. That’s not happening. There’s no sign that Democrats are willing to address this. If they did, we wouldn’t be seeing new fraud cases every month. We need to get the fraud under control, and we need to put a process in place so we can stop waste, fraud, and abuse before it begins.