UnitedHealth’s Optum identified $1.7 billion in potential savings if Minnesota would remedy ambiguity in its Medicaid policies, according to a Jan. 31 from the company.
As of October, the Minnesota Department of Human Services had contracted with Optum to analyze claims data across 14 “high-risk” Medicaid fee-for-service programs. Fraud allegations have been rampant in the state, prompting Gov. Tim Walz to not seek a third term as he cited his work on prevention efforts.
During the first 90 days of a yearlong contract, Optum reviewed the programs, looking for vulnerabilities. The audit’s second stage will have a pre-payment focus. In January, state officials confirmed how Optum was actively working on the audit. On Feb. 6, the state said it anticipates having a pre-payment review process established by the end of the year.
A letter to Minnesota IT’s chief business technology officer said the report is not intended to determine fraud, waste or abuse.
Four numbers to know:
1. If the state honed and updated Medicaid policies, Minnesota could find $1.7 billion in potential savings.
2. Across 46 months of claims data, Optum identified more than $52.3 million in direct recoveries in the high-risk services due to policy violations. Non-emergency medical transportation, night supervision, early intensive developmental and behavioral intervention and individualized home supports were the biggest contributors.
3. During the fourth quarter of 2025 — amid national scrutiny and a payment pause — Minnesota saw more than a $165 million quarter-over-quarter drop, or “cost avoidance,” in Medicaid fee-for-service spending.
4. With the 14 services, Optum identified 813,992 claim lines, or single service-level billings, from 1,769 providers that violated policies and were linked to direct recoveries.
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