Feds Warn Minnesota: Bolster Medicaid Fraud Fight or Face Funding Cuts
Published Date: 1/14/2026
Notice
Summary
Minnesota’s Medicaid program isn’t doing enough to stop fraud, waste, and abuse, so the federal government may hold back some funding until the state fixes these problems. Minnesota has 15 days to ask for a hearing to explain or challenge this decision. This means the state must step up its game to protect Medicaid money and follow the rules, or risk losing federal support.
Analyzed Economic Effects
3 provisions identified: 0 benefits, 3 costs, 0 mixed.
Federal Funds May Be Withheld
If you have Medicaid in Minnesota, CMS may withhold a portion of federal Medicaid funds from the State until Minnesota fixes program integrity problems. CMS estimated a quarterly federal-share withholding equal to one quarter's prior-year federal payments for 14 high-risk services at $515,154,947.56, and said that amount may increase until Minnesota fully implements an acceptable corrective action plan.
Focused Audit Could Deny Reported Payments
CMS will begin a focused review of Minnesota's quarterly expenditure reports (Form CMS-64) for the 14 self-identified high-risk services, starting with Quarter Four of Federal Fiscal Year 2025. CMS may defer or disallow any federal financial participation claimed for those services that does not meet federal requirements.
Deadlines for Hearing and Corrective Plan
Minnesota has a short timetable to respond: requests to participate as a party must be received within 15 days of the Federal Register notice (January 14, 2026), the State has 10 days from the letter date to request a hearing, and CMS asked Minnesota to submit a revised comprehensive corrective action plan by January 30, 2026. If the State does not request a hearing within 5 days of the letter, CMS said it would impose the withholding contingent on progress.
Personalized for You
How does this regulation affect your finances?
Personalize government policy and PRIA will tell you what this federal register document means for your household, plus every other regulation we track. PRIA reads each provision against your financial profile to show you exactly what matters to your wallet.
Key Dates
Department and Agencies
Related Federal Register Documents
2026-20281, Global Benchmark for Efficient Drug Pricing (GLOBE) Model
Starting November 30, 2026, Medicare will use the new GLOBE Model to help lower the cost of certain drugs for people on Original Medicare. This model changes how drug price increases are calculated, aiming to save money for both patients and the Medicare program without cutting care quality. If you’re on Medicare Part B, expect smarter drug pricing that helps keep your healthcare affordable.
2026-20131, Medicare Program; Inpatient Rehabilitation Facility Prospective Payment System for Federal Fiscal Year 2027 and Updates to the IRF Quality Reporting Program; Correction
This correction fixes some technical mistakes in the Medicare payment rules for inpatient rehab facilities starting October 1, 2026. It mainly affects hospitals and rehab centers by clarifying how wage data and payments are calculated, ensuring fairer payment rates for fiscal year 2027. No big changes in money, but it keeps everything accurate and on track.
2026-19959, Medicare Program; Prospective Payment System and Consolidated Billing for Skilled Nursing Facilities; Updates to the Quality Reporting Program for Federal Fiscal Year 2027; Correction
This correction fixes some technical mistakes in Medicare payment rules for skilled nursing facilities starting October 1, 2026. It mainly affects how hospital data is used to calculate payments, making sure no current hospitals are wrongly excluded. These tweaks help keep Medicare payments fair and accurate for providers and patients.
2026-20067, Medicare Program; FY 2027 Hospice Wage Index and Payment Rate Update and Hospice Quality Reporting Program Requirements; Correction
This correction fixes some technical mistakes in the FY 2027 hospice payment and wage index rules that were first published in August 2026. It mainly affects hospice providers by updating how their payments are calculated, making sure the numbers are accurate starting October 1, 2026. These changes help ensure hospices get the right payment amounts based on the latest hospital wage data.
2026-19946, Medicare Program; Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals (IPPS) and the Long-Term Care Hospital Prospective Payment System and Policy Changes and Fiscal Year (FY) 2027 Rates; Requirements for Quality Programs; Other Policy Changes; and Adoption of Updated Versions of Certain Health Information Technology Standards; Correction
This update fixes some typos and technical mistakes in the Medicare payment rules for hospitals starting October 1, 2026. It affects hospitals getting paid for patient care, making sure the payment system and quality programs run smoothly. These corrections help hospitals get the right payments and follow updated health tech standards without delays or confusion.
2026-15652, Medicare Program; Inpatient Rehabilitation Facility Prospective Payment System for Federal Fiscal Year 2027 and Updates to the IRF Quality Reporting Program
This final rule updates the prospective payment rates for inpatient rehabilitation facilities (IRFs) for Federal fiscal year (FY) 2027. As required by statute, this final rule includes the classification and weighting factors for the IRF prospective payment system's (PPS) case-mix groups and a description of the methodologies and data used in computing the prospective payment rates for FY 2027. It also finalizes the third and final of the 3-year phaseout of the rural adjustment, which began in FY 2025. This final rule includes a solicitation for public comments on alternative data sources for the IRF PPS wage index; requires all therapy treatments and/or therapy evaluations to begin no later than 36 hours from midnight on the day of admission; finalizes requirements for the initial Interdisciplinary Team meeting to occur on or before 4 days from the date the patient is admitted; and summarizes a request for information on potential future IRF PPS payment reform. Additionally, this final rule includes updates to the IRF Quality Reporting Program and changes to the Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Competitive Bidding Program.
Previous / Next Documents
Previous: 2026-00510, New England Fishery Management Council; Public Meeting
The New England Fishery Management Council is holding a 2-day virtual meeting on January 28-29, 2026, to discuss important updates and rules for local fisheries, including fishing limits for Atlantic cod and haddock. Fishermen, seafood businesses, and coastal communities will be affected by these decisions, which aim to keep fish populations healthy and fishing fair. You can join online, share your thoughts, and stay informed about changes that might impact your catch and wallet.
Next: 2026-00513, Request for Information for the 2026 Trafficking in Persons Report
The Department of State wants your help to gather info for the 2026 Trafficking in Persons Report, which checks how well the U.S. and other countries fight human trafficking. If countries don’t meet the rules, they might lose some U.S. aid. Send your input by February 27, 2026, to help shape this important report and protect victims worldwide.