Ken Moraif
Matt, Hello everyone, and welcome to the Retirement Planners of America podcast. And we have a our goal is to have more fun than a human being should be allowed to have when talking about financial stuff. And we have a series of podcasts that we’re producing for you. This is the first of three. The first one we’re going to do in this podcast is we’re going to talk about the whole thing that happened in Medicaid, and how in Minnesota, rather, which we’re calling a Medicaid heist. And we want to talk about, you know, what happened? How does that possible? How does Medicaid, you know, all of that stuff, and why should you care? And we’ll talk about that. Then also, as a follow up, the first one is basically the government got defrauded, right? The government was the victim. Well, we’re going to talk in the second podcast is how to keep yourself from becoming a victim. Okay, so we’re going to narrow the universe down to you, and then in our third we’re going to talk about the fact that insurance premiums and Medicare premiums are going up significantly in 2026 and what should you do about it? There’s lots of tips we’ll have for you on that. So I hope you’re gonna watch all three of them. You’re gonna listen to all three of them. If you’re like my wife, she doesn’t ever watch a single podcast. She walks around with her phone on speaker, and I all, I was know where she is, because it’s like that thing is going off. I can’t even talk to her because there’s a podcast going on at the same time. But anyway, hopefully you’ll enjoy all three of them more than a human being should be allowed to have. So let’s get started. I have Lynn Tim with me, our resident expert. So Lynn, hello.

Lynn Timm
Hi Ken. Thank you for having me today. I’m really excited to be here.

Ken Moraif
I’m very excited to have you. This is, you know, this, this whole Medicaid heist, this thing that’s going on in Minnesota is in the news right now, and it seems to be a developing story. And I don’t really want to get into the politics of it. I kind of want to talk more about, you know, how does the system work, and how were these people able to take advantage of it? Let’s say so. Let’s go over that. How does the how does the whole system work?

Lynn Timm
Well, I think a lot of it started in 2020 you know, with the covid era. So all of these government programs were put into place, and they grew so quickly with relatively low oversight that people took advantage of them. And so I think what happened in Minnesota is is in the news because it’s so staggeringly large, it’s billions, billion, yes, estimated. So it’s it’s caught the attention, but it’s part of a larger problem that affects all the states. So I think that this is something that we’re going to see more of as the current administration tries to get a handle on corruption that’s gone on for years and years.

Ken Moraif
And this was, this was because during the pandemic, they had to basically build systems and processes quickly, yes, where people were home bound, they couldn’t go out, and so they had to build all these things in. And this created payment systems and post payment audits and, you know, and all those kind of things that were just ripe for fraud.

Lynn Timm
Yes, and particularly, there were three programs that were involved in this, and most of the fraud stemmed from these three programs, and, you know, feeding children. So there were groups that were saying they were feeding hundreds and hundreds of children and bilking the government out of millions of dollars on that program. There were programs for autism that were done on children that didn’t even have autism, and the parents were getting kickbacks, and then there were programs for housing for drug addicted individuals and so forth, to try to find them housing. And that was projected, I think it was like 2.6 million were projected on that program, and it went to 104 million. So just incredible, out of control billing and,

Ken Moraif
yeah, and the whole thing is, you know, in their rush to get this whole thing done, they establish, basically, and I guess Medicare all these things are post payment audits, right? So, in other words, you you incur the cost, and then they audited afterwards.

Lynn Timm
Well, part of the problem was the programs grew so quickly, and some of them were new programs, so they were unique to Minnesota, and there was enough oversight, so probably a lot of them weren’t audited at all, until years later. You know, the one big, beautiful Bill kind of shed a light on what was going on, yeah.

Ken Moraif
So, you know, I’ve always, you know, counseled clients that you know, with contractors. For example, if you’re building a house, you don’t audit what they’re doing after they’ve done it. You make sure that. You’re doing it. While they’re doing it, you’re checking there every day exactly you need to do that. And apparently this was not happened. And then to make it even, you know, for me, mind blowingly naive, I guess, is that they also assume that people are honest when it comes to this stuff. Oh, well,

Lynn Timm
do you think people are always honest when they’re asking for government

money. Yes,

no. I mean, that’s just, it’s crazy what what they were writing checks for and approving and and all of this, you know, defrauded the Medicaid system, and that has largely been taken advantage of by, you know, throughout the country.

Ken Moraif
So, yeah, so, you know, anytime again, it’s kind of like, as I said, working with a contractor, if you’re building a house or you’re renovating or something, and you give them the money first, and then you expect them to do the work after. You know, my experience with contractors, with all due respect to all contractors out there, love you guys, is that you do not pay them in advance. In fact, you don’t pay them until it is completely finished and then you’ve inspected it, and then you give them that last payment. But this was, here’s the money first, and then we’ll make sure that you’d actually provided the services, and there were no services provided, exactly. So how does this, you know, in your opinion, how does this affect, like, the whole government system? You know, because you said this potentially is not just in Minnesota. This is potentially in other states as well.

Lynn Timm
Well, we’ve seen it go on for years with Medicaid. So what you know, what we’ve seen is that the current administration has pulled back on Medicaid funding for lots of programs and cut funding for those programs. So some of those programs are really necessary and are used by people that need them, but they’re shining a light on the ones that are are are not necessary, and the people that are taking advantage of the system. So unfortunately, I think some of the people that really need the help are not able to get it. Yeah, and so hopefully, you know what it will do is root out the the bad, the bad people. And hopefully, you know the Medicaid system will do what it’s supposed to do and help those that are truly needy.

Ken Moraif
So I’ve heard that there’s a push towards going back and looking at every single person that’s receiving these government programs and essentially making them reapply so as to eliminate all the people that actually don’t exist. Because if you don’t exist, you can’t reapply, right? What do you think about that idea?

Lynn Timm
Yes, because there were so many people that applied for those programs that don’t exist. Like you said, These people were buying lists and getting lists of names off the internet of people that didn’t even exist. They were just making up names. And so I think, you know, that’s obviously the first step where they have to prove the ones that were were fraudulent,

Ken Moraif
yeah, yeah. It’s a terrible thing, you know, when I think of you know that these programs, the billions of dollars that you know, were stolen, that’s money that could have been used for actual children that needed that money, you know, actual families, programs, etc, and this was just taken away. And it’s a travesty on, you know, a titanic scale, and it’s really terrible. And I hope that every one of those people who are involved in that are found throughout the whole country, and I hope they are all prosecuted to the highest extent of the law, because these are the people in our society that need these programs the most, and they took money out of that system from those people. And to me, that’s unconscionable, right?

Lynn Timm
And that really hurts all the taxpayers, right? When, when one area is getting so much fraud and so much waste and abuse it affects all of us.

Ken Moraif
Yeah, so that’s kind of, you know, the big picture, I guess I’ll call it. And so what we want to do in our next podcast is to kind of narrow the universe and talk about how to keep yourself from becoming a Medicare victim. So we’ve talked about how the government was made a victim. So in our next podcast, we’re going to we’re going to talk about how you can protect yourself from becoming a victim as well. So I hope this podcast found you healthy, wealthy and wise. I hope you had more fun than a human being should be allowed to have when talking about all this stuff, and we’ll talk soon.