St. Paul -- Minnesota lawmakers and the state's legislative auditor plans to look at how a Minnesota Department of Human Services employee may have embezzled almost $1 million from money intended for health care for the state's needy.
On Friday, Gov. Tim Pawlenty said the allegations were "very serious" but limited his comments, citing privacy concerns related to the employee.
The employee allegedly diverted close to $1 million for personal use over several years from money intended for the Medical Assistance program, which is partly funded by the federal government and which the state Department of Human Services administers. The U.S. attorney's office is investigating, sources said.
State Sen. Linda Berglin, DFL-Minneapolis, said she believes the employee set up a bogus health-care company to funnel money from the department more than five years ago. She said she read that the employee is on leave.
Now, there are safeguards in place that wouldn't allow health-care money to be sent to a phony company, she said state officials assured her. But the original company was set up before those checks existed.
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"This has been going on for a very long period of time, is my understanding," said Berglin, chair of the Senate's health and human services committee. "If somebody tried to do this today, there would be many, many more verifications."
The Minnesota Office of the Legislative Auditor plans to do a "thorough statewide examination" of the controls in state government that prevent or detect fraud in state departments, state Auditor Jim Nobles said.
"The public deserves better," he said.
The Medical Assistance program, Minnesota's name for Medicaid, covers about half a million people.
