More Heat On Four H-M-Os That Run Minnesota's Medicaid

Updated: 03/27/2012 10:59 PM KSTP.com By: Jay Kolls

A new state report questions how four HMOs spend four-billion dollars of taxpayers' money on Medicaid.

The Minnesota Department of Health hired an independent accounting firm to look at the HMOs administrative expenses and investment income for the state's Medicaid program. 

The firm, Deloitte Consulting, concluded it was "not possible to determine if administrative expenses and investment income was being properly and fairly allocated among all of an HMO's lines of business. 

State Senator John Marty, (DFL) Roseville, tells 5 EYEWITNESS NEWS this latest report should raise more red flags about how taxpayers' money is being spent by the HMOs. Marty says "it clearly shows no one knows how the money is exactly spent." 

The four HMOs are Blue Cross/Blue Shield of Minnesota, HealthPartners, Medica and U-Care. Those four companies, and a state agency, are also under federal investigation over the Medicaid program. Just last week, three top executives left Blue/Cross Blue Shield. The company did not return our calls seeking comment.