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Minnesota Fraud Scandal Persists as Expert Warns State Has Not Slowed Down
ReMinnesota Fraud Scandal Persists as Expert Warns State Has Not Slowed Down
Despite national attention and billions in alleged losses, Minnesota's fraud scandal continues, with a policy expert warning that new assisted-living licenses and a recent criminal complaint show the problem is far from over.
Minnesota's massive fraud scandal, which has cost taxpayers billions and drawn national scrutiny, is far from resolved, according to a policy expert who warns that the state has not taken the necessary steps to root out the problem. Bill Glahn, a policy fellow at the Center of the American Experiment, told Fox News Digital, "We have not slowed down, there is no sense in which the fraud has been stopped in Minnesota."
Glahn has been raising alarms about the rapid growth in provisional assisted-living licenses, most for small facilities, which he says may be outpacing state oversight. He noted that the state's licensing database shows 364 new facilities with provisional licenses over the past year, and he has called for a 90-day moratorium on new licenses while officials investigate. "We have something along the order of 2,500 of these licensed across the state, but about 20% of them, around three, 400 of them have just been started in the last year," Glahn explained. He added that the Minnesota Department of Health is approving more than one new facility every day, and he questioned whether all of them are legitimate.
Glahn pointed to a recent criminal complaint filed by Minnesota Attorney General Keith Ellison's office against Salman Ahmed Elmi, who was charged on Aug. 17 with eight felony theft offenses tied to alleged Medicaid billing fraud. The complaint also details alleged ties among Medicaid-funded businesses, properties previously used for commercial sex services, and individuals investigators say were part of a sex-trafficking organization. "This is two scandals in one," Glahn said. "You have a commercial sex operation, actual brothels, housed in what were later licensed as assisted-living facilities under the Medicaid program." Elmi, who previously received a state award for being an "Outstanding Refugee," is a stark example that the fraud is not old news, Glahn argued.
Glahn contends that the latest allegations reveal a deeper problem within state agencies responsible for vetting providers and monitoring taxpayer-funded programs. "Personnel is policy," he said. "There isn't a regulatory mindset under the Walz administration. There isn't the mindset that we need to trust but verify." He criticized Governor Tim Walz for not firing anyone over the failure to detect or prosecute the fraud, saying, "It's the same people doing the same thing, and that culture has never changed."
While Minnesota officials and lawmakers have taken some fraud-prevention steps since the scandal erupted, Glahn stressed that the reforms do not address the central issue of accountability. He noted that Lt. Gov. Peggy Flanagan is running for Senate and Sen. Amy Klobuchar is running for governor, despite both being in positions of power while the scandal festered. "Amy Klobuchar has come out with her multi-point plan of how she's gonna fight fraud once she gets in office, if she gets elected in November," Glahn said. "I don't know why we couldn't implement this stuff today. Tim Walz could call a special session. We could be in session on Monday, passing an anti-fraud agenda, but there's nothing."
Fox News Digital reached out to Walz's office, Klobuchar's campaign, and the Minnesota Department of Health for comment but did not receive a response. The Minnesota Department of Human Services told Fox News Digital that it has rolled out a series of anti-fraud reforms since the fall of 2024, including identifying 14 high-risk services, freezing enrollment of new providers in those programs, discontinuing the Housing Stabilization Services program, auditing autism-service providers through onsite visits, instituting licensure requirements for autism centers, and disenrolling inactive providers. The agency also said it has expanded pre-payment reviews for providers in 13 high-risk fee-for-service programs and completed revalidation determinations.
