Minnesota DHS Overpaid Local Indian Tribes $25.3 Million for Medicaid Assisted Therapy Treatments

Minnesota’s Department of Human Services (DHS) overpaid the Leech Lake Band of Ojibwe and the White Earth Nation tribes $25.3 million for substance abuse programs, the Pioneer Press reported Thursday. The money given to the tribes went toward Medicaid’s medication-assisted therapy treatments.

DHS officials learned of the overpayment this spring. The $25.3 million figure is just a preliminary estimate. In an internal memo obtained by the Pioneer Press, the agency reveals that it doesn’t know how the financial mishandling occurred.

Gov. Tim Walz confirmed the report and said the situation goes back five years into former Gov. Mark Dayton’s administration. The governor also said the overpayment was discovered in January and fixed in May.

Pam Wheelock, the acting DHS commissioner, told the Pioneer Press that the agency is looking into the matter.

“DHS is now determining the estimated amount of overpayment, has informed the tribes and is working with them to determine the final amount. DHS is reviewing internal processes and policy guidance to determine how the overpayments occurred and how to prevent them from happening again,” she said.

White Earth Nation released a statement Thursday saying they are “troubled by the lack of meaningful consultation on this issue.”

“We asked questions and expected responses; we received an urgent request for a mid-week late-afternoon conference call. At a bare minimum, we expected actual dialogue between a state agency and a Tribal government as ordered by the Governor,” the tribe said.

Walz has ordered an auditor to look into the financial mishandling. Legislative Auditor Jim Nobles, who will oversee the investigation, told MPR News that given the “magnitude of the alleged overpayment, we need to be cautious about making initial judgments.”

This financial error continues the summer of turmoil for the state’s largest agency, which in recent weeks has seen high-ranking officials resign and un-resign while investigations into other officials remain pending.

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Zachery Schmidt is the digital editor of Battleground State News. Follow Zachery on Twitter.
Photo “Minnesota Capitol” by Gabriel Vanslette. CC BY 3.0.