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Despite Minnesota’s fraud scandal exploding onto the national scene and costing taxpayers billions, there are growing concerns that the state has still not done what’s necessary to root out the problem.
“We have not slowed down, there is no sense in which the fraud has been stopped in Minnesota,” Bill Glahn, a policy fellow at the Center of the American Experiment, told Digital.
Glahn has been warning on social media that Minnesota’s rapid growth in provisional assisted-living licenses, most for small facilities, may be outpacing state oversight. In a recent article, Glahn explained the state’s licensing database showed 364 new facilities with provisional licenses popping up over the past year and called for a 90-day moratorium on new licenses while officials investigate.
“We have something along the order of 2,500 of these licensed across the state, but about 20% of them, around three, 400 of them have just been started in the last year,” Glahn explained.
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Minnesota Gov. Tim Walz testifies during a House Oversight and Government Reform Committee hearing in the U.S. Capitol in Washington, D.C., on March 4, 2026. The hearing examined alleged misuse of federal funds for Minnesota social services and Medicaid programs. (Anna Moneymaker/Getty Images)
“I’m not sure if there’s a real underlying driver in the demographics or the demand for these facilities, but it’s odd that we have these assisted living facilities linked to Medicaid fraud, at the same time, the Minnesota Department of Health is approving more than one a day. More than one new facility gets approved every single day, 365 days a year. And I don’t think anybody is really giving any thought to, hey, maybe some of this is not on the up and up.”
Glahn also pointed to a recent criminal complaint filed by Minnesota Attorney General Keith Ellison’s office against Salman Ahmed Elmi, who was charged Aug. 17 with eight felony theft offenses tied to alleged Medicaid billing fraud, as evidence that fraud is still taking place.
The criminal complaint also details alleged ties among the Medicaid-funded businesses, properties previously used to provide commercial sex services and people investigators say were part of a sex-trafficking organization.
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“This is two scandals in one,” Glahn said. “You have a commercial sex operation, actual brothels, housed in what were later licensed as assisted-living facilities under the Medicaid program.”
Elmi previously received an award from the state for being an “Outstanding Refugee.”
“Elmi’s case alone makes clear that this is not old news,” Glahn said. “This particular fraud was going on just a couple of months ago.”
Glahn argued that the latest allegations point to a deeper problem within the state agencies responsible for vetting providers and monitoring taxpayer-funded programs which haven’t been properly addressed.
“Personnel is policy,” Glahn said. “There isn’t a regulatory mindset under the Walz administration. There isn’t the mindset that we need to trust but verify.”
While Minnesota officials and lawmakers have taken some fraud-prevention steps since the fraud scandal erupted onto the national scene, Glahn stressed that the reforms do not address what he sees as the central issue: a lack of accountability for those who failed to identify the schemes earlier
“Walz has never cleaned house, he’s never fired anybody for not detecting the fraud or not prosecuting the fraud,” Glahn said. “It’s the same people doing the same thing, and that culture has never changed.”
For Glahn, the messaging should start at the top.
“They’re just operating as business as usual,” Glahn said. “We don’t have anybody who’s currently in office, currently in charge of state government, at least in the executive branch, who’s doing anything substantive to address the fraud. It’s just amazing how we see these reports every day, and we have Tim Walz traveling the country, traveling elsewhere. He’s a lame duck. He doesn’t seem to have any interest in closing out this chapter of his legacy with any kind of victory on the fraud front.”
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Minnesota Gov. Tim Walz testifies during a House Oversight and Government Reform Committee hearing at the U.S. Capitol Building in Washington, D.C., on March 4, 2026. The committee held the hearing to examine the alleged misuse of federal funds intended for Minnesota social services and Medicaid programs. (Getty Images)
In addition to the perception that not enough accountability has been taken for the scandal, Walz’s Lt. Gov. Peggy Flanagan is running for Senate while Minnesota Sen. Amy Klobuchar is running for governor despite both being in positions of power during the duration of time the fraud scandal festered.
“Amy Klobuchar has come out with her multi-point plan of how she’s gonna fight fraud once she gets in office, if she gets elected in November,” Glahn explained. “I don’t know why we couldn’t implement this stuff today. She’s called for a top-to-bottom audit of state government. She’s got another few data points that perhaps were legislative proposals that didn’t get passed. Tim Walz could call a special session. We could be in session on Monday, passing an anti-fraud agenda, but there’s nothing. So I guess he just fundamentally doesn’t have an interest in the subject.”
Digital reached out to Walz’s office, Klobuchar’s campaign and the Minnesota Department of Health for comment but did not receive a response.
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Sen. Amy Klobuchar (D-MN) speaks during a rally in support of a “Yes” vote on Proposition 50, a congressional redistricting measure in the November 4 special election, at the Los Angeles Convention Center in Los Angeles, California, on November 1, 2025. (David Swanson/REUTERS)
The Minnesota Department of Human Services told Digital in a statement that it has rolled out a series of anti-fraud reforms since the fall of 2024, including identifying 14 high-risk services and freezing the enrollment of new providers in those programs. The agency also said it discontinued the Housing Stabilization Services program, began auditing autism-service providers through onsite visits, instituted licensure requirements for autism centers and disenrolled inactive providers.
DHS said it has also expanded pre-payment reviews for providers in 13 high-risk fee-for-service programs and completed revalidation determinations for high-risk providers by the end of May. Since the beginning of 2025, the department said it has stopped payments to 747 Medicaid providers over what it described as credible allegations of fraud and made 824 referrals to law enforcement.
