Dayton welcomes federal investigation of MN Medicaid

Gov. Mark Dayton says he welcomes a federal investigation of the state's Medicaid program. The focus of the investigation remains unclear.

Human Services Commissioner Lucinda Jesson has confirmed an investigation is under way, but said she doesn't know the scope of the inquiry or how serious it is. Dayton said he doesn't know if there's been any wrongdoing.

Jesson spoke Tuesday afternoon before a legislative committee on whether managed care programs disclose enough information about their balance sheets.

Jesson told lawmakers she became aware of a federal investigation last summer when the feds asked the department to provide documents and other information. Jesson told lawmakers she had her own concerns about the HMOs providing medicaid services — that their profit margins were increasing; and that at times they were making more money on government programs than private. However, she said she did not see any fraud.

"I didn't see any deliberate wrongdoing but rather I just believed we weren't leveraging the very best deals we could," she said.

Jesson said the governor last year signed an executive order that required managed to undergo audits by the department of commerce and annually report all of the administrative expenses.

"We have nothing to defend. We just came in, and Commissioner Jesson's done a wonderful job of reducing the cost of competitive bidding with the health plans. But if we can save dollars, if there are dollars being misspent, we want to know about that so we can correct it going forward," Dayton said.