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Legislative News and Views - Rep. Josh Heintzeman (R)

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Legislative Update from Rep. Josh Heintzeman

Thursday, October 31, 2019

Dear Neighbors,

On Tuesday, the non-partisan Legislative Auditor (OLA) released a highly anticipated special review looking into $29 million in improper payments made by the Minnesota Department of Human Services (DHS) to two tribal governments for addiction services.

The report found that DHS repeatedly approved a billing practice that effectively resulted in double-billing to the federal government—once for an in-person visit, and multiple additional reimbursements when patients self-administer medication at home.

In the special review, the OLA blamed "troubling dysfunction" at DHS, noting the agency "did not have legal authority to make the payments”. The overpayments continued over several years and did not stop until an outside inquiry discovered them.

News of the improper payments emerged during a tumultuous summer that saw DHS plagued with scandal. The start of the summer was met with the abrupt resignation of Commissioner Tony Lourey, who left after only a few months on the job.

Lourey’s abrupt resignation was only the beginning. Here is a quick rundown of everything that has happened at DHS this summer:

  • On July 22, the Star Tribune reported that Faye Bernstein, a lead contract specialist at DHS, claimed she had been retaliated against for raising concerns about “serious non-compliance issues” with DHS contracts.
  • On July 29, the former medical director of DHS’ Medicaid program circulated an open letter saying DHS leadership was “hostile and dismissive” towards the advice and concerns provided by himself and other medical professionals.
  • Also on July 29, former head of the DHS Office of Inspector General Carolyn Ham was transferred to the DHS Office of General Counsel, returning to work despite being under investigation for her role in failing to prevent pervasive fraud in the Child Care Assistance Program (CCAP).
  • On August 1, the Pioneer Press first reported on $25.3 million in overpayments to two tribal governments for Medicaid substance abuse treatments. According to a subsequent Pioneer Press report, Lieutenant Governor Peggy Flanagan has stated that the Walz administration will seek to “change the law that holds tribal governments financially responsible for overpayments”.
  • On August 16, the Star Tribune reported that Mohamed Alfash, who was the equity coordinator in the DHS Office of Inspector General, was fired as a result of retaliation for concerns he raised within DHS.
  • On August 26, Deputy Commissioner Claire Wilson announced her intent to resign, just weeks after rescinding her previous resignation prior to the departure of former DHS Commissioner Tony Lourey.
  • Also on August 26, the Pioneer Press reported that DHS will be required to reimburse the Centers for Medicare and Medicaid Services approximately $48 million for improper payments to institutions for mental diseases.

It’s clear that there is a serious cultural and accountability problem at DHS and I am supportive of a full forensic audit to get to the bottom of these problems. One thing is certain, Minnesota taxpayers should not be on the hook to pay back DHS’ $29 million mistake. They should instead find the $29 million from within their own $18 billion budget.

Stay tuned for more information on this as it is sure to play a significant role during the upcoming legislative session.

As always, please do not hesitate to reach out to me to share your thoughts or concerns. I can be reached by phone at 651-296-4333 or via email at

Have a great weekend,