MN Medicaid deadline: Providers see funding cutoff

A rushed Medicaid review has left thousands of Minnesota care providers suddenly without funding, putting essential services, vulnerable patients, and jobs at risk. The sudden Medicaid cutoff comes after the federal government withheld $2 billion over fraud concerns, forcing the state to evaluate about 5,500 providers in high-risk programs in just five months.

ST. PAUL, Minn. (FOX 9) – A rushed Medicaid review has left thousands of Minnesota care providers suddenly without funding, putting services and jobs at risk.

Providers face sudden Medicaid cutoff after federal pressure

What we know:

The deadline for Medicaid providers to complete the state’s revalidation process was midnight Sunday. Many, like Susan Holman of Legacy Place Assisted Living in Sauk Rapids, found themselves disenrolled without clear explanation. Holman said, “I’m disenrolled now. I’m disenrolled as of today.”

Holman and her husband have run their assisted living business for 14 years. She submitted all required documents on May 1, but by June 1, her application was still pending review. She then received notice that her Medicaid funding was terminated. “I don’t know if they meant to do all of this to everybody. I don’t know. But I know I’m not alone in this,” said Holman.

The review was triggered when the federal government withheld $2 billion in Medicaid funding to Minnesota over fraud concerns. The state was forced to quickly check about 5,500 providers in 13 high-risk programs in just five months—a process that usually takes most states two years. As of last Wednesday, only about 1,000 providers had passed.

The impact on home care services

Why you should care:

Home care providers in northern Minnesota and along the North Shore are also facing funding cuts. Meghann Lewis and Codi Warnecke, who run Bella Mente Home Care and Heart & Hara Home Care, say the process has been confusing and communication has been lacking. “It’s just been really disorganized that there’s no up or down and there’s no one to talk to,” said Lewis.

Lewis received a letter confirming her revalidation, only to get another letter an hour later suspending her funding. “An hour later I had another private letter in the same mailbox that says we’re suspending your CFSS due to failed revalidation,” said Lewis. Warnecke said, “For the last two weeks, the payroll has come out of my personal pocket.”

Both are appealing the rejections and considering lawsuits against the state. Holman is also planning an appeal, but with as many as 5,000 businesses in the same situation, she doubts the state will resolve things quickly. Some businesses may not survive, which could put vulnerable people at risk of losing essential care.

Many providers are left frustrated and uncertain about their future. “This doesn’t make any sense to me. I’m so frustrated,” said Holman.

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MN Medicaid providers revalidation limbo

A deadline for Minnesota Medicaid service providers to revalidate their services for federal funding has now come and gone. FOX 9’s Corin Hoggard explains what it could mean for some.

The state’s response and what happens next

The other side:

FOX 9’s Corin Hoggard tried to get answers from the Minnesota Department of Human Services, but the agency declined interviews and did not provide updated data about the review process.

Providers are left in limbo as they wait for appeals to be processed and hope for funding to be restored. In the meantime, they are doing what they can to keep services going for those who depend on them.

What we don’t know:

It is unclear how many providers will ultimately regain Medicaid funding or how quickly the state will resolve the appeals. The Minnesota Department of Human Services has not shared updated numbers or details about the next steps.

ST. PAUL, Minn. (FOX 9) – Sunday was the deadline for Minnesota to complete the revalidation of thousands of Medicaid providers in “high-risk” programs as the state fights with the federal government over about $2 billion in funding.

What is Minnesota Revalidate?

The backstory:

Earlier this year, state leaders announced an effort to revalidate more than 5,500 providers in Minnesota’s Health Care Programs. The revalidation was part of an effort to combat fraud and to satisfy demands from the federal Centers for Medicare and Medicaid Services, which has withheld up to $2 billion in Medicaid funds from Minnesota.

The deadline to finish the revalidation was on Sunday, May 31.

What we know:

As of last month, state officials said only 550 providers have had applications approved, site inspections completed and been re-enrolled.

At that point, 1,510 applications were incomplete, and 160 providers had been disenrolled. State officials said mostly because they had failed to respond to state inquiries.

There were an additional 990 who had been submitting claims but failed to respond to state notices.

Medicaid funding lawsuit

Local perspective:

In January, Medicaid Administrator Dr. Mehmet Oz announced the Centers for Medicare and Medicaid Services would withhold $2 billion in Medicaid funding for Minnesota.

The decision followed an audit by the centers of Minnesota’s Medicaid programs. The funding suspension also followed a new batch of federal Medicaid fraud charges that came down in December. During a news conference, as prosecutors announced new charges and guilty pleas related to fraud, federal prosecutors estimated that fraud in Minnesota’s Medicaid programs could total as high as $9 billion since 2018.

The other side:

Since that press conference, the $9 billion figure has been heavily disputed by state leaders who say there is currently no evidence that fraud in Minnesota is that rampant. Gov. Walz and other state leaders say that while fraud is an issue, President Trump has weaponized it to commit political retribution against the state.

What’s next:

FOX 9 has reached out to state officials to see how many providers are facing disenrollment as the deadline hits on Sunday.

Earlier this year, Attorney General Keith Ellison filed a lawsuit over the pulled Medicaid funds. This month, a judge granted a mutual motion for a stay in the case – a 120 pause – to give the federal government and Minnesota time to resolve the funding issue. An update is due to the court by early September.