In a coordinated effort to reduce fraud, waste and abuse in Minnesota’s Medicaid program, Governor Tim Walz announced on Oct. 29, 2025, a new process for the Minnesota Department of Human Services (DHS) to review claims for certain Medicaid benefits and services before they are adjudicated. Refer to the Governor Walz Orders Third-Party Audit of Medicaid Billing at DHS press release for more information.
Optum, a third-party vendor, will oversee the new pre-payment review process and will start by reviewing fee-for-service claims for 14 specific benefits and services that were identified as high-risk. Optum will verify that billed services were necessary, correctly documented and provided before DHS makes payments.
We have identified the following 14 benefits and services as high-risk:
- Adult Companion Services
- Adult Day Services
- Adult Rehabilitative Mental Health Services
- Assertive Community Treatment
- Community First Services and Supports
- Early Intensive Developmental and Behavioral Intervention
- Housing Stabilization Services
- Individualized Home Supports
- Integrated Community Supports
- Intensive Residential Treatment Services
- Night Supervision Services
- Nonemergency Medical Transportation Services
- Recovery Peer Support
- Recuperative Care
The new pre-payment review process does not change what has been and remains as MHCP’s mandated claim review timeframes:
- MHCP has 30 days to pay or deny clean claims (without attachments).
- MHCP has 90 days to pay or deny complex claims (replacement claims, Medicare crossovers, third-party liability claims, claims with information in the notes or comment fields, or claims with attachments).
- The DHS Commissioner has the legislative authority to suspend and perform a deeper analysis on any claims which may be potentially suspect with regard to fraud, waste or abuse.
We are working with Optum on a regular interval to review any suspended fee-for-service claims for the 14 high-risk benefits and services and will continue to adjudicate claims timely and efficiently without compromising needed review. DHS is not holding all submitted claims for the 14 high-risk benefits and services for 90 days. Some submitted claims could be suspended for up to 90 days and, of course, some of these claims may be denied.
The pre-payment review will be an ongoing and permanent new process for DHS as fee-for-service claims come in and before provider payments go out. We are implementing this new process for fee-for-service claims only. Additionally, this new safeguard will be tied to services, not provider types.
