Legislation to expand Medicaid fraud investigation unit heads to House Floor

A second fraud-fighting bill is headed to the House Floor.

On Tuesday, the House Ways and Means Committee advanced HF2354, as amended, that would increase staffing for the state’s Medicaid fraud investigation unit in the Office of the Attorney General.

“We’re fighting fraud on all fronts this afternoon,” said bill sponsor Rep. Matt Norris (DFL-Blaine). His bill to create an Office of Inspector General was approved by the committee last week and is scheduled for House action Thursday.

The current bill would allocate funds primarily for hiring 18 new Medicaid fraud investigation unit positions: 11 investigators, three attorneys and four support staff at a cost of $1.23 million from the General Fund in Fiscal Year 2027. The amendment would eliminate future year General Fund spending beginning in Fiscal Year 2028, instead setting the base at $1.23 million from the state government special revenue fund in fiscal years 2028 and 2029.

The same provision but with just Fiscal Year 2027 funding is still in the omnibus human services policy and budget bill, HF4338, which was also amended and approved by the committee Tuesday. It, too, awaits action by the full House.

The omnibus bill’s inclusion of a single appropriation of $1.23 million Fiscal Year 2027 for the state’s Medicaid fraud investigation unit was a sticking point for some members on the House Human Services Policy and Finance Committee April 16, ending in gridlock.

[MORE: Committee rejects sustained funding hike for Medicaid fraud investigation unit]

But a yearly appropriation unlocks a federal funding match of about $3 for every $1 spent by the state, Norris said. “It’s essentially buy one fraud-fighter, get three free from the federal government, which seems to be a pretty good deal to me.”

[MORE: Bill aims to expand attorney general’s power to prosecute Medicaid fraud]