Legislative leaders back site visits and AI tools to curb fraud in Minnesota
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Senate Majority Leader Erin Murphy and House Speaker Lisa Demuth speak at an Axios Live event.Photo credits: Lucas Botz on behalf of Axios
The Minnesota Legislature's to-do list for tackling fraud could include AI tools, more inspectors and structural changes to social services programs, two top leaders told Axios.
Why it matters: Mounting concern — and political pressure — over fraud in state-managed programs is set to dominate the Capitol and the campaign trail this year.
- Just Thursday, the Walz administration announced that it will freeze new provider enrollments in 13 high-risk Medicaid programs for six months.
🔎 What they're saying: "I think there should be more site visits," Senate Majority Leader Erin Murphy said Thursday at an Axios Live event on public health when asked whether Minnesota needs more inspectors to conduct spot checks of providers who bill the state for social services.
- "I think that's something that the administration is working on," the St. Paul Democrat.
House Speaker Lisa Demuth (R-Cold Spring), who has also called for more unannounced site visits, voiced support for using AI and other analytical tools to keep health care costs down and make sure that state and federal taxpayer dollars aren't going to fraud.
- "Any dollars that go out to fraud means the ones that need it most don't get it," the Cold Spring Republican said.
The intrigue: Murphy also acknowledged that the Legislature needs to "take care of" what she called "design issues" with Medicaid-funded programs, which she noted were set up under both DFL and GOP control.
- But she noted that adding more staff and technology takes more investment — even as lawmakers face fiscal and political pressure to cut spending.
Friction point: The two leaders clashed over the role a conservative influencer's viral YouTube video alleging fraud by child care providers played in escalating scrutiny — and tensions.
- Demuth said the video, which she has previously said was aided by House GOP staff research, brought much-needed attention to an issue that "needed to get out."
- Murphy denounced the impact the backlash to the video has had on legitimate providers and families who rely on child care and now-frozen federal grants to work. "There are better ways to make a point," she said.
Between the lines: The politically explosive issue — which already derailed Gov. Tim Walz's reelection plans — will be a flashpoint in the November battle for control of the narrowly divided Capitol.
- Three-quarters of Minnesotans think the Legislature hasn't done enough to address the issue, a recent KSTP poll found.
What we're watching: The results of an audit of 14 Medicaid programs, which Walz previously said was due early this year, will give a better sense of the scale and scope of the problem — likely adding fuel to the debate.
Watch: Murphy on access to public health ... Demuth on a potential race against Klobuchar.