Audit urges state to boost oversight of public program costs

Published 10:18 am Wednesday, March 11, 2015

ST. PAUL — Minnesota’s legislative auditor urged state officials on Tuesday to take a bigger role in administering public health programs, saying costs to run them could be trimmed if lawmakers set tighter rules.

The Office of the Legislative Auditor released a report that found that the state paid out more than $278 million in administrative costs in 2012. Those costs were generally sound, but they could be scaled back if the Legislature set firmer rules for what expenses could be charged to the state, the report suggested.

Public health programs such as Medical Assistance, the state’s version of Medicaid, account for about $6 billion of the state’s roughly $40 billion budget. The state pays large nonprofit health insurance companies, including HealthPartners and Medica, to manage and deliver those programs.

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Spending on Minnesota’s public programs has been scrutinized for years, including the money that the nonprofits receive for managing those plans. Minnesota is currently being investigated by the federal government for possible improprieties in how much federal Medicaid money the state has received to run Medical Assistance, Legislative Auditor Jim Nobles said.