Chapter 5 of 7 · 2017–2025

Warnings Ignored

Auditors, investigators and whistleblowers warned for years. Hearings were discouraged, critics were called racist, and no one was fired.

Attorney General Keith Ellison meets meal-program operators, December 11, 2021 (recording published by Bill Glahn) · full record

Source: Center of the American Experiment · original. Played here unaltered except as noted on this page; rights remain with the publisher.

In one minute

  1. Former Legislative Auditor Jim Nobles has written that then-Speaker Melissa Hortman told him House chairs had been instructed not to give his fraud reports public hearings. report p. 7 report p. 18
  2. In January 2025 the DHS commissioner told senators there were "more rumors of fraud than actual fraud." She was replaced weeks later. report p. 13 report p. 37
  3. Legislators who raised the alarm, among them Rep. Mary Franson, were called racist. report p. 18
  4. DHS told the committee it faced pressure from legislators to license providers faster. report p. 55
  5. State Medicaid spending rose from $12.9 billion to $19.6 billion in four years while the Attorney General's Medicaid fraud unit stayed at 32 staff. Minnesota Attorney General's Office, Medicaid Fraud Control Unit, committee document
“there are more rumors of fraud than actual fraud”
Then-DHS Commissioner Jodi Harpstead, January 2025, quoted in the committee report, p. 13
“In fact, DHS faced a lot of pressure from legislators and the public on not going fast enough and not getting enough providers licensed or approved or enrolled as providers.”
Commissioner Shireen Gandhi, quoted in the committee report, p. 55
“This is obviously incorrect and a dereliction of duty.”
Committee majority report, p. 73

Enabled, continued, covered up

The committee report's own frame for what two administrations did. Report, p. 8

Enabled

Programs built with low barriers to entry, weak controls and no verification up front.

p. 8
Continued

Auditor reports, whistleblowers and red flags ignored, though the tools to stop payment already existed.

p. 8
Covered up

No one held accountable; whistleblowers retaliated against and accused of racism.

p. 21

From the committee's own documents

Attorney General's Medicaid Fraud Control Unit slide 'Minnesota MFCU Staff Size', 2019-2023: MN state Medicaid budget grows from $12.90 billion to $19.60 billion and the MFCU budget from $4 million to $5.39 million, while approved MFCU staff stays at 32 every year against a 'predicted' staff size that rises from 30 to 41.
Attorney General's Medicaid Fraud Control Unit slide 'Minnesota MFCU Staff Size', 2019-2023: MN state Medicaid budget grows from $12.90 billion to $19.60 billion and the MFCU budget from $4 million to $5.39 million, while approved MFCU staff stays at 32 every year against a 'predicted' staff size that rises from 30 to 41.Minnesota Attorney General's Office, Medicaid Fraud Control Unit (Nick Wanka, MFCU Director) · House Fraud Committee hearing of 2025-05-05 · AGO_DOCS-#5989086-v1-Legislative_Presentation.pdf, p. 10
OLA slide 'BHA Leadership Feedback': stacked bars from a summer 2025 survey of Behavioral Health Administration employees (196 surveyed, 86% response). Agreement that leadership 'values employee input' 12% strongly agree / 44% agree / 20% disagree / 12% strongly disagree / 13% no opinion; 'shares relevant information in a timely manner' 12/48/24/8/8; 'consistently makes decisions in line with state and federal requirements' 24/49/6/4/16.
OLA slide 'BHA Leadership Feedback': stacked bars from a summer 2025 survey of Behavioral Health Administration employees (196 surveyed, 86% response). Agreement that leadership 'values employee input' 12% strongly agree / 44% agree / 20% disagree / 12% strongly disagree / 13% no opinion; 'shares relevant information in a timely manner' 12/48/24/8/8; 'consistently makes decisions in line with state and federal requirements' 24/49/6/4/16.Office of the Legislative Auditor (OLA) · House Fraud Committee hearing of 2026-04-07 · 20260316 DHS_BHA Grants to Fraud Oversight Committee.pdf, p. 9
DHS EIDBI report 'Table 1: Health and safety standards established for EIDBI in comparison to licensed DHS programs': EIDBI has 'No' for all seven topics (medication administration, transportation, telephones, emergency plan, pets, first aid kit, facility standards) while child care, adult day, foster care, HCBS and children's residential programs have 'Yes' for all.
DHS EIDBI report 'Table 1: Health and safety standards established for EIDBI in comparison to licensed DHS programs': EIDBI has 'No' for all seven topics (medication administration, transportation, telephones, emergency plan, pets, first aid kit, facility standards) while child care, adult day, foster care, HCBS and children's residential programs have 'Yes' for all.Minnesota Department of Human Services, Disability Services Division (legislative report, January 2025) · House Fraud Committee hearing of 2026-02-23 · eidbi licensing recommendations.pdf, p. 32

Go deeper

Report: Executive SummaryPages 5–12, searchable.Report: Management and Budget & Office of Grants ManagementPages 70–75, searchable.Report: Periodic Data MatchingPages 76–78, searchable.

People

Keith EllisonBill GlahnAyan Farah AbukarJodi HarpsteadTim WalzDeena WinterGlen Kerns

The record for this chapter