The state's top government watchdog has opened an investigation into a report that the Minnesota Department of Human Services (DHS) overpaid two Indian bands approximately $25 million for substance-abuse treatment.
Legislative Auditor James Nobles said Thursday that his office — an independent, nonpartisan arm of the Legislature — is exploring the cause of the overpayments, when they began, why they were not discovered earlier and who was responsible. He said DHS notified his office of the overpayments about 10 days ago.
The alleged overpayments were made to the Leech Lake Band of Ojibwe and the White Earth Nation to provide Suboxone, a medication used to treat opioid dependency, he said.
"This is serious," Nobles said. "It's not only a lot of money, but it's a lot of money for a specific service to a specific and a very small set of vendors."
In a written statement, Gov. Tim Walz said the problem was corrected in May and that the overpayments have stopped. "We are now taking a deeper dive to figure out the root of this issue and help ensure nothing like it happens again," Walz said. "In order to do this, we brought the issue to the Office of the Legislative Auditor."
Both bands said there has been a rush to judgment by state officials and that they were not fully consulted. Leech Lake officials directly denied that the band had been overpaid.
In an interview Thursday, Acting Human Services Commissioner Pam Wheelock said the agency first learned of the issue this year, when an employee from another band asked the agency about billing procedures for addiction treatment medications.
A subsequent audit determined that the two bands were billing the state's Medicaid insurance program at the higher rate for in-clinic treatment, when in fact the patients were taking the medications at home.