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Legislative Update (8-16-19)

Friday, August 16, 2019

Dear Neighbor,

The Minnesota Department of Human Services is a complete shambles, with so many problems it’s hard to keep track. The issues run so deep that even the state auditor said “no one has all the facts” and that “it’s going to be a long journey” to clean up this mess of an agency.

I take major exception to the failure of leadership from the governor and his administration regarding DHS, which is our state’s largest agency. Taxpayers deserve better and the lack of transparency, bureaucratic arrogance and blatant disregard for tax dollars we’ve witnessed is insulting to Minnesotans and must stop.

We are all wondering what’s wrong with DHS and, to catch up, here’s just some of what has taken place lately:

There has been serious turmoil in the top DHS positions, including recent resignations by Commissioner Lourey, two deputy commissioners (who subsequently rescinded their resignations) and the chief of staff. Also, a 13-year director of Minnesota’s Medicaid program had his position eliminated … with just three days’ notice.

Meanwhile, DHS Inspector General Carolyn Ham was placed on paid leave in March when rampant fraud was reported in a state childcare assistance program. The OLA also reported a toxic working relationship between Ham and investigators working to find fraud in public programs at DHS.

Ham continued collecting her six-figure salary for around four months while on leave, but has since returned to work at the agency – before the investigation has been completed! – after being reassigned to the DHS Office of General Counsel.

We also recently learned of $25 million in overpayments by DHS to two tribes for opioid addiction medication. The upshot is that DHS gave the tribes bad advice on reimbursement billing and now the agency wants the taxpayers’ money back. One thing: DHS knew about the overpayments before the 2019 legislative session adjourned. But, instead of coming forward and asking for help in fixing this problem when they had the chance, they kept quiet and the issue didn’t become public until the Pioneer Press wrote about it earlier this month.

So far, House Democrats have completely ignored the turmoil in DHS, dismissing calls for hearings. Senate Republicans did conduct a DHS hearing on this issue Tuesday. Very few answers were provided by DHS. Among the interesting points of discussion:

  • A DHS whistleblower who testified about her experiences in the agency said she was told by a DHS employee that she could lose her job if she appeared before the committee.

    • Despite the potential consequences, she reportedly used a vacation day to attend the meeting and share how she was disciplined and retaliated against for reporting problems with DHS contracts.

    • She said she was criticized for being “too focused on compliance.” If that doesn’t illustrate the problems at DHS, nothing will.

  • The Office of the Legislative Auditor renewed their suggestion that the Inspector General should either be strengthened or removed completely from DHS.

    • House Republicans pushed for this repeatedly in the last session but House Democrats resisted.

Gov. Walz named Lutheran Social Service President Jodi Harpstead as Minnesota’s new Department of Human Services commissioner on Monday. Republicans have been sounding the alarm about waste, fraud, and abuse across DHS for years. We can only hope Harpstead will be a commissioner who is interested in working with legislators to strengthen our public programs, protect taxpayers and improve the transparency of this $19 billion agency.

It goes without saying this situation is developing, so stay tuned as more information emerges. We need to keep pressing for answers in the short term, but also should conduct DHS hearings when the House comes together for a mini special session the first week in October in Winona. At some point, House Democrats need to stop being silent on these DHS problems and join us in demanding answers that will help us find solutions.


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