Governor Tim Walz today introduced a comprehensive legislative package aimed at preventing, detecting, investigating, and holding accountable those who commit fraud in Minnesota’s state programs. The Governor was joined by Department of Human Services (DHS) Commissioner Shireen Gandhi, DHS Inspector General James Clark, and Bureau of Criminal Apprehension (BCA) Superintendent Drew Evans.
“Fraud steals from the people of Minnesota and undermines the programs we all rely on,” said Governor Walz. “This package strengthens oversight, improves detection, expands enforcement, and increases penalties to protect every dollar Minnesotans depend on. We’ve followed the experts, audits, and proven roadmaps; now it’s time for the Legislature to act.”
The proposal builds on steps taken over the past several years, including the creation of the BCA’s Financial Crimes and Fraud Section, the appointment of a statewide Director of Program Integrity, executive orders empowering state agencies to combat fraud, and improved leadership at DHS. The package incorporates recommendations from independent experts and Director Tim O’Malley’s roadmap, focusing on proactive prevention, stronger accountability, and modernized systems.
Key elements of the Governor’s Anti-Fraud Package include:
Better Detection and Oversight
- Strengthens program integrity in Managed Care Organizations
- Expands audit and internal control capacity to ensure funds are properly spent and misused dollars are recovered.
- Uses predictive analytics and machine learning to identify suspicious billing earlier.
- Prohibits legislatively named grants, requiring competitive processes to ensure fairness and transparency.
Strengthened Investigative and Enforcement Authority
- Establishes a centralized Office of Inspector General to lead statewide fraud prevention, set standards, and refer cases for civil or criminal enforcement.
- Expands BCA Financial Crimes and Fraud Unit capacity and subpoena authority.
- Enhances authority for on-site investigations across Minnesota Health Care Programs, including providers who have not yet billed claims.
- Adds capacity for fraud prevention at the Department of Revenue and the Attorney General’s Medicaid Fraud Unit.
- Establishes permanent bans from state contracts and grants for individuals convicted of fraud, including new businesses and subcontractors.
Increased Criminal Penalties
- Creates a new Theft of Public Funds statute, increasing penalties by 20 percent.
- Extends statutes of limitations to seven years for certain fraud-related crimes.
The Governor’s full anti-fraud package is available here.
