I was informed by the DHS Deputy Commissioner this week that CMS is threatening to withhold $515 ml in Q1 2026. In December, CMS asked for a correction plan on 2 items. That was submitted in a timely manner and DHS recently heard from CMS that it wasn't complete and now requested plans on 5 more items!  They are working diligently to complete that plan to avoid CMS withholding funds and ensure clients receive services. They have expressed empathy toward providers and are very concerned about clients, but they must also navigate the demands from CMS.

Today CMS included the following in the Federal Register's Public Inspection Desk: Notice of Opportunity for Hearing on Compliance of Minnesota State Plan Provisions Concerning Program Integrity and Fraud, Waste, and Abuse With Title XIX (Medicaid) of the Social Security Act: https://www.federalregister.gov/public-inspection/2026-00512/opportunity-for-hearing-on-compliance-of-minnesota-state-plan-provisions-concerning-program. There will be a hearing in Chicago. My Alliance contacts tell me they believe the DHS Commissioner will be the one to testify, but I have asked John Connelly what we can do to help them. The notice states that a revised correction plan should be submitted by January 30, 2026 and that DHS has 5 days to request a hearing.

The best advice I have at this point is brace yourself, be as prepared as possible to secure back-funds and ensure you are submitting VERY clean claims. I am hoping the state will have some funds to assist in this situation, but I am uncertain. If you have a relationship with any of the MN Senators or Representatives, I urge you to lay out the significant disruption this will have for their constituents. I will reach out to all the congressional offices but it's clear this is very political and I'm not certain how much the Democrats can assist at this point.  All communication to Republicans will be welcomed!  I will ponder further strategy.

In closing, I don't plan to share this heavy news with members yet (unless you advise otherwise). I'd like to get further info from DHS about the possibility of reserve funding.

Please contact me with any questions you have or ideas you'd like me to consider. I'm around this weekend and willing to have conversations, in between my planned activities. My cell is 612.590.4180.

Kind Regards,

Kathy Messerli
Executive Director
Minnesota Home Care Association

2909 S. Wayzata Blvd. | Minneapolis, MN 55405
Direct: 651.635.0038 | Main: 651.635.0607
www.mnhomecare.org<http://www.mnhomecare.org/page/A17> | kmesserli@mnhomecare.org<mailto:kmesserli@mnhomecare.org>
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