Minn. seeking outside Medicaid audit

ST. PAUL, Minn. -- The Dayton administration is seeking an independent review into how the state set payment rates for Medicaid HMOs during the Pawlenty administration.

Medicaid is a joint state and federal safety net program for the elderly in nursing homes, the poor and children.

Dogged by persistent questions that the state may have overpaid its Medicaid contractors in the past, Human Services Commissioner Lucinda Jesson says an outside, independent analysis will settle questions about whether the state's payments to managed care contractors were higher than allowed under state and federal law.

"Enough questions have been raised that I think it's best to bring in an outside expert to look at what happened under the previous administration as well," Jesson said.

Questions surrounding Minnesota's Medicaid program arose after the state received a $30 million payment from UCare, an HMO, last year. Amid state and congressional inquiries, the state agreed to split the payment with the federal government.

Rep. Jim Abeler, chairman of the House Health and Human Services Finance Committee, says it's reasonable for the state to seek an independent review about how the Pawlenty administration determined payments to HMOs.

The audit will examine Medicaid's payment rates for fiscal years 2003 through 2011.

Abeler says initially he thought there was no need for a review back to 2003. But he says since questions still persist, an audit makes sense.

"I think it's reasonable to request a whole third-party independent person to look into it and see if anything was improper or not," Abeler said. "I believe in the end they'll find nothing was improper; we did everything by the book."

The Dayton administration says it hopes to have an audit report available in mid-November.