Minnesota shifts focus to Medicaid oversight

Minnesota’s policy landscape is shifting as state leaders elevate program integrity and oversight in state-administered programs. Recent developments include a major political announcement from Governor Tim Walz and a new approach to reviewing certain Medicaid claims before payment.

On January 5, 2026, Minnesota Governor Tim Walz announced he will not seek a third term in office. In his statement, Walz said he wants to use his remaining time in office to focus on addressing fraud and strengthening oversight within state-administered programs, rather than running a re-election campaign. The decision significantly reshapes Minnesota’s 2026 gubernatorial race and comes as state oversight practices face heightened scrutiny.

Following an executive order issued on October 29, 2025, Minnesota’s Department of Human Services initiated an enhanced pre-payment review of Medicaid claims in programs identified as high risk. As part of the effort, Optum was contracted as an independent third-party reviewer. The initial phase selected approximately 80,000 fee-for-service Medicaid claims for review before payment. The claims include those tied to adult day services, behavioral health supports, and early intervention programs.

The enhanced pre-payment review is intended to prevent improper payments and strengthen program integrity. At the same time, the process may create operational impacts for providers, including payment delays and increased documentation requirements connected to the review.