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Minnesota Audit Flags $1.7 Billion in Medicaid Claims for Review, Finds $52 Million in Violations

The findings sharpen a funding fight over a proposed $2 billion federal withholding under appeal.

Overview

  • An Optum review of 46 months of fee‑for‑service Medicaid claims across 14 high‑risk programs examined about $9.4 billion and identified $52.3 million that violated policy, with roughly $1.7 billion requiring deeper review.
  • State officials stressed the flagged totals are not evidence of fraud and often reflect unclear rules or documentation issues that need policy fixes.
  • DHS has launched an AI‑enabled prepayment review, placed temporary payment holds or delays on the 14 services, and begun revalidating 5,800 providers with unannounced site checks.
  • Early autism intervention drew the heaviest scrutiny, with more than 90% of claims not clearly matching policy and about $1 billion of the potential $1.7 billion tied to that service area.
  • CMS has opened its own audit as the federal administration seeks to withhold up to $2 billion in Medicaid funds, a move Minnesota has appealed.