Minnesota Tackles Coverage Risks and Fraud Amid Federal Policy Shifts
Minnesota is navigating a delicate balance between maintaining Medicaid coverage for vulnerable populations and combating fraud, waste, and abuse following new federal legislation. Changes like work requirements and shorter redetermination periods threaten to disenroll up to 140,000 people, prompting state leaders to implement safeguards such as reduced lookback periods. The focus remains on preserving access while strengthening oversight through coordinated efforts with counties and community partners.
In September 2026, Minnesota faced mounting pressure to balance Medicaid coverage continuity with intensified efforts to combat fraud, waste, and abuse (FWA) following the implementation of the 2025 budget reconciliation legislation—commonly known as the Working Families Tax Cut Act (WFTCA). The law introduced federal mandates such as work requirements, six-month redetermination periods, cost-sharing for expansion enrollees, and restrictions on coverage for certain lawfully present immigrants. These changes threaten to disenroll up to 140,000 Minnesotans, prompting state leaders to respond with targeted safeguards. For example, lawmakers including Sen. Alice Mann and Rep. Mohamud Noor advocated for reducing the required lookback period for work verification from three months to one, aiming to ease administrative burdens on vulnerable populations. The Minnesota Department of Human Services (DHS), under federal scrutiny since CMS demanded a corrective action plan (CAP) in December 2025, submitted and received approval for a revised CAP by March 19, 2026. In response, the state revalidated high-risk providers, imposed a moratorium on new service providers in high-risk areas, launched a public program integrity dashboard, eliminated the Housing Stabilization Services benefit, and secured funding to expand its program integrity workforce by over 400 positions over two years. Key figures like former DHS Deputy Commissioner Chuck Johnson emphasized the need for systemic redesign of
Minnesota’s current struggle to maintain Medicaid access while strengthening program integrity reflects a nationwide trend where federal cost-control measures intersect with state-level delivery challenges. The potential disenrollment of 140,000 people under the WFTCA could disproportionately affect communities of color, individuals with disabilities, and those in rural areas—groups already facing systemic barriers to healthcare. If similar policies are adopted elsewhere, this could strain safety-net providers and exacerbate existing workforce shortages, particularly in behavioral health and home-based care. The state’s emphasis on prevention through compliance training, technology, and early risk detection may serve as a model for other states grappling with CMS oversight demands. However, the success of such models depends heavily on sustained investment—what is not yet known is whether federal funding will continue to support these integrity initiatives beyond initial implementation