Fraudulent Medicaid Programs in Minnesota: Investigation Reveals Extent of Abuse

Sat Dec 20 2025 12:21:31 GMT+0200 (Eastern European Standard Time)

At least 14 state-run Medicaid programs in Minnesota have been flagged for fraudulent activities, jeopardizing essential services for those in need.

Minnesota's Medicaid system faces serious allegations as federal prosecutors reveal that 14 state-run programs are under investigation for fraud, with an estimated $18 billion potentially lost to fraudulent claims. New charges have been filed against five individuals involved in a housing services fraud scheme that displaced funds meant for vulnerable citizens. Prosecutor Joe Thompson highlights the need for improved oversight in the state's Medicaid administration to safeguard services for legitimate clients.

MINNEAPOLIS (AP) — At least 14 state-run Medicaid programs in Minnesota have been flagged for fraudulent activities, prompting federal officials to express concerns over a staggering $18 billion in potentially misappropriated funds.

During a recent news conference, First Assistant U.S. Attorney Joe Thompson outlined the breadth of the issue, emphasizing that the fraud is not limited to isolated cases but represents systemic problems within the state's Medicaid programs.

What we’re seeing is programs that are entirely fraudulent, he asserted, indicating that the scale of the fraud could classify Minnesota as a significant hub for fraudulent activity, particularly concerning immigrant groups.

In a recent development, five individuals have been charged in connection with fraudulent claims related to the Minnesota Housing Stability Services Program, allegedly pocketing $750,000 instead of applying the funds to help those in need of stable housing. Reports indicate that these defendants used the proceeds to travel to lavish destinations such as London and Dubai.

Additionally, another defendant is accused of submitting more than $1.4 million in false claims, utilizing some of these funds to purchase cryptocurrency before fleeing the country upon receiving a subpoena.

These revelations come as officials continue to investigate further claims of fraud within other state-funded programs, including those designed to support children with autism. The Attorney’s office mentioned ongoing efforts to address these fraudulent activities, stressing that the current system has not adequately filtered legitimate service providers from questionable claims.

Thompson highlighted that the outcomes of these fraudulent activities are dire, stating that vulnerable patients who rely on these services are being adversely affected. There’s real patients, real clients, real people who need services and aren’t getting them, he stated, calling for immediate reforms to improve accountability and oversight in the system.