State says it will disenroll 60% of 'high-risk' Medicaid providers

More than 60% of Medicaid providers in Minnesota’s “high-risk” service areas will be disenrolled after the Department of Human Services announced the results of a review Thursday, June 4.

The review spanned all 87 counties for 13 identified “high-risk” services among nearly 5,600 providers, which included adult day services, autism therapy and independent living support. Nearly 40% of providers were located in Hennepin County.

More than 3,400 providers were notified they will be disenrolled. Of those, nearly 2,500 were disenrolled due incomplete or inaccurate data, 916 failed site visits and four provider owners failed background checks.

More than 100 providers were removed from review because they are no longer providing the high-risk service. DHS stated that 59 providers were referred to the Office of Inspector General for further review.

“The paperwork is a critical step,” stated Deputy Commissioner Shireen Gandhi in the news release. “This is just not checking the box. DHS uses the information to check requirements are met. And when we go on site what we see must match what was submitted to us.”

Common reasons for disenrollment notices include failure to disclose management authority or report a change in ownership, failure to report changes or maintain proper credentials, failure to provide access and incomplete applications.

In the months-long review, more than 2,000 were revalidated and will continue to provide Medicaid services without interruption, DHS reported in the news release.

Minnesota’s social services fraud issues have continued to be cited as cause for withholding federal dollars and the impetus for Operation Metro Surge.

“The Department of Human Services had five months to revalidate high-risk providers,” stated a fact sheet. “[The Center for Medicare and Medicaid Service] has subsequently given the rest of the nation two years to complete the same process.”

The review was part of “Minnesota Revalidate 2026,” an effort to convince the CMS to reverse course on its threat to withhold over $2 billion in annual Medicaid funding for low-income Minnesotans.

“More than 1 million Minnesotans deserve to have confidence and trust in the Medicaid providers they depend on for lifesaving and life-affirming care,” stated Gandhi. “We are grateful to the providers who successfully completed the revalidation process and will continue to provide quality care.”

While providers may appeal, the disenrollments mean some Minnesotans will need to change the way they access Medicaid services.

Minnesota counties, tribes and other lead agencies have been working with the state to identify which providers were disenrolled. DHS has also been reaching out directly to Minnesotans without case managers who receive services from providers who may be disenrolled, with a new webpage listing resources for people who need to connect to new providers.

The revalidation effort, according to the release, builds on other measures to tighten oversight of Medicaid, including enhanced pre-payment review for high-risk providers, a temporary freeze on new provider enrollment in high-risk programs, and auditing and implementing provisional licensure for autism service providers.

“Minnesotans deserve to trust that businesses receiving Medicaid dollars are legitimate and properly credentialed, and that they provide quality care,” stated Human Services Inspector General James Clark. “We’re not just resetting expectations for providers, we’re also establishing a baseline for building back public trust.”