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Report criticizes MinnesotaCare administration
January 21, 2003

A legislative auditor's report has found several problems in the way the state manages the MinnesotaCare health insurance program.

	Project Manager Deborah Junod.

St. Paul, Minn. — As a result of errors or fraud, applicants for the state-run insurance program MinnesotaCare underpaid premiums by at least $5 million and as much as $22 million last year.

Those are among the findings in a new report by the legislative auditor.

MinnesotaCare was started in 1992 to serve as a health insurance program for people who aren't poor enough to get state-provided health care, but can't afford private health insurance.

Eligibility is determined by a complex system that takes into account what workers' employers cover as well as their income. But the study found that in about one-third of cases, state and county staff made errors when determining MinnesotaCare applicants' income.

The study also found that many applicants misreported what insurance was available from their employers.

Many of the problems came about because of weaknesses in the Department of Human Services computer systems. Most of the processing is done by hand.

In a written reply, Commissioner Kevin Goodno said he will make changes, including putting into place a new computer system, though that isn't expected to be in place for 18 months.

"The report identifies the challenges we face as we pursue our goal," Goodno wrote.

The report recommends that DHS tighten its income eligibility policies and do more frequent audits of applications.

Under the program, enrollees pay a monthly premium based on a sliding scale. Last year, an average of 144,000 used it in any given month, costing $390 million.

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