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Minnesota Legislature

Legislative News and Views - Rep. Nick Zerwas (R)

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Wednesday, April 10, 2019

ST. PAUL, MN—On Wednesday the non-partisan Office of the Legislative Auditor (OLA) released a special review evaluating internal controls for Minnesota's Child Care Assistance Program (CCAP). The program has been under scrutiny over what the OLA has described in a previous report as "pervasive" fraud. The report stated that the program integrity controls at the Department of Human Services (DHS) "are insufficient to effectively prevent, detect, and investigate fraud in Minnesota's Child Care Assistance Program."

"Minnesotans want fraud in our public programs taken seriously—they work hard for their money, and expect that government will protect their tax dollars," said Rep. Mary Franson, R-Alexandria, Republican Lead on the House Early Childhood Division. "Democrats in the House have refused to hold hearings on the previous OLA report, blocked efforts to bring the Inspector General in to testify, and have offered few solutions that would crack down on pervasive fraud in the childcare program. It's time for Democrats to wake up, and stop pretending this problem doesn't exist."

Democrats have refused to hold hearings to discuss the first Legislative Audit report on the CCAP Fraud issue, which was released on March 13. They also voted twice to block Republican-backed motions to subpoena Department of Human Services Inspector General Carolyn Ham to appear before House committees to discuss CCAP fraud and her response to the audit report. They have given hearings to just one Republican-backed fraud prevention bill, and have included minimal fraud prevention legislation in their expansive 1128 page Health and Human Services (HHS) Omnibus bill.

"The Department of Human Services owes Minnesotans and legislators an explanation on why they have failed to put measures in place to prevent fraud and protect Minnesotans' tax dollars," added Rep. Nick Zerwas, R-Elk River. "If Democrats refuse to pass fraud prevention legislation, I expect the Department will do everything in their power to put fixes in place that will address the numerous issues identified in this audit report, and show Minnesotans they take this issue seriously."

The report detailed numerous issues at DHS and the county level that have resulted in inadequate program integrity including findings that:

  • "DHS and county agencies did not sufficiently leverage independent, external data sources to verify recipient eligibility for CCAP."
  • "DHS had weak processes to validate that CCAP provider billings aligned with actual child care provided."
  • That the payment system for CCAP (MEC squared) "lacked some key controls to identify errors and to inhibit, track, and recover improper payments."
  • "DHS did not implement sufficient program integrity controls for licensing child care providers."
  • "DHS did not adequately identify and analyze the risk of fraud in CCAP and had weak processes to coordinate investigations statewide."