HF 2354

2nd Engrossment - 94th Legislature (2025 - 2026) Posted on 04/24/2025 04:55pm

A bill for an act
relating to consumer protection; adding and modifying provisions governing
Medicaid fraud; providing the attorney general certain subpoena and enforcement
authority; providing criminal penalties; making conforming changes; appropriating
money; amending Minnesota Statutes 2024, sections 8.16, subdivision 1; 256B.12;
609.52, subdivision 2; 628.26; proposing coding for new law in Minnesota Statutes,
chapter 609; repealing Minnesota Statutes 2024, section 609.466.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2024, section 8.16, subdivision 1, is amended to read:

Subdivision 1.

Authority.

new text begin (a) new text end The attorney general, or any deputy, assistant, or special
assistant attorney general whom the attorney general authorizes in writing, has the authority
in any county of the state to subpoena and require the production of new text begin : (1) new text end any records of new text begin : (i) new text end
telephone companies, cellular phone companies, new text begin and new text end paging companies deleted text begin , deleted text end new text begin ; new text end new text begin (ii) new text end subscribers of
private computer networks new text begin , new text end including Internet service providers or computer bulletin board
systems deleted text begin , deleted text end new text begin ; new text end new text begin (iii) new text end electric companies, gas companies, new text begin and new text end water utilities deleted text begin , deleted text end new text begin ; (iv) new text end chemical suppliers deleted text begin , deleted text end new text begin ; new text end new text begin
(v) new text end hotels and motels deleted text begin , deleted text end new text begin ; new text end new text begin (vi) new text end pawn shops deleted text begin , deleted text end new text begin ; (vii) new text end airlines, buses, taxis, and other entities engaged
in the business of transporting people deleted text begin , deleted text end new text begin ; new text end and new text begin (viii) new text end freight companies, self-service storage
facilities, warehousing companies, package delivery companies, and other entities engaged
in the businesses of transport, storage, or delivery deleted text begin , and deleted text end new text begin ; (2) wage and employment records;
(3) new text end records of the existence of safe deposit box account numbers and customer savings and
checking account numbers maintained by financial institutions and safe deposit companies new text begin ;
(4) insurance records related to claim settlement; and (5) the banking, credit card, and
financial records, including but not limited to a safe deposit, loan and account application
and agreement, signature card, statement, check, transfer, account authorization, safe deposit
access record, and documentation of fraud, that belong to the subject of an investigation
conducted pursuant to the attorney general's authority under section 256B.12, whether the
record is held in the investigation subject's name or in another person's name new text end .

new text begin (b) new text end Subpoenas may only be issued for records that are relevant to an ongoing legitimate
law enforcement investigation.

Sec. 2.

Minnesota Statutes 2024, section 256B.12, is amended to read:

256B.12 LEGAL REPRESENTATION.

The attorney general or the appropriate county attorney appearing at the direction of the
attorney general shall be the attorney for the state agency, and the county attorney of the
appropriate county shall be the attorney for the local agency in all matters pertaining hereto.
To prosecute under this chapter or sections deleted text begin 609.466 and deleted text end new text begin 609.467; new text end 609.52, subdivision 2 deleted text begin , deleted text end new text begin ; new text end new text begin
and 609.542, new text end or to recover payments wrongfully made under this chapter, the attorney
general or the appropriate county attorney, acting independently or at the direction of the
attorney general may institute a criminal or civil action.

Sec. 3.

new text begin [609.467] MEDICAL ASSISTANCE FRAUD.
new text end

new text begin Subdivision 1. new text end

new text begin Medical assistance fraud prohibited. new text end

new text begin A person who intentionally
presents, submits, tenders, offers, or participates in the preparation of a claim for payment,
claim for reimbursement, cost report, or rate application relating to the payment of medical
assistance funds under chapter 256B knowing or having reason to know that any part of the
claim, report, or application is false is guilty of medical assistance fraud and may be
sentenced as provided in subdivision 2.
new text end

new text begin Subd. 2. new text end

new text begin Penalties. new text end

new text begin Whoever violates subdivision 1 may be sentenced as follows:
new text end

new text begin (1) to imprisonment of not more than 20 years, payment of a fine of not more than
$100,000, or both if the part of any claim for payment, claim for reimbursement, cost report,
or rate application submitted, tendered, or offered that is false is more than $35,000;
new text end

new text begin (2) to imprisonment of not more than ten years, payment of a fine of not more than
$20,000, or both if:
new text end

new text begin (i) the part of any claim for payment, claim for reimbursement, cost report, or rate
application submitted, tendered, or offered that is false is more than $5,000 but not more
than $35,000; or
new text end

new text begin (ii) the part of any claim for payment, claim for reimbursement, cost report, or rate
application submitted, tendered, or offered that is false is not more than $5,000 and the
person has been convicted within the preceding five years for an offense under this section,
section 256.98; 268.182; 609.24; 609.245; 609.247; 609.522; 609.53; 609.582, subdivision
1, 2, or 3; 609.625; 609.63; 609.631; or 609.821, or a statute from another state, the United
States, or a foreign jurisdiction, in conformity with any of those sections, and the person
received a felony or gross misdemeanor sentence for the offense, or a sentence that was
stayed under section 609.135 if the offense to which a plea was entered would allow
imposition of a felony or gross misdemeanor sentence; or
new text end

new text begin (3) to imprisonment of not more than five years, payment of a fine of not more than
$10,000, or both if the part of any claim for payment, claim for reimbursement, cost report,
or rate application submitted, tendered, or offered that is false is not more than $5,000.
new text end

new text begin Subd. 3. new text end

new text begin Aggregation. new text end

new text begin The total of all claims for payment, claims for reimbursement,
cost reports, and rate applications submitted, tendered, or offered in violation of subdivision
1 within any six-month period may be aggregated and the defendant charged accordingly
in applying the provisions of subdivision 2. When the same person commits two or more
offenses in two or more counties, the accused may be prosecuted for all of the offenses
aggregated under this subdivision in any county in which one of the offenses was committed.
new text end

new text begin Subd. 4. new text end

new text begin Venue. new text end

new text begin Notwithstanding anything to the contrary in section 627.01, a violation
of this section may be prosecuted in:
new text end

new text begin (1) the county where any part of the offense occurred; or
new text end

new text begin (2) the county where the entity who received a claim for payment, claim for
reimbursement, cost report, or rate application is located.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective August 1, 2025, and applies to crimes
committed on or after that date.
new text end

Sec. 4.

Minnesota Statutes 2024, section 609.52, subdivision 2, is amended to read:

Subd. 2.

Acts constituting theft.

(a) Whoever does any of the following commits theft
and may be sentenced as provided in subdivision 3:

(1) intentionally and without claim of right takes, uses, transfers, conceals or retains
possession of movable property of another without the other's consent and with intent to
deprive the owner permanently of possession of the property; or

(2) with or without having a legal interest in movable property, intentionally and without
consent, takes the property out of the possession of a pledgee or other person having a
superior right of possession, with intent thereby to deprive the pledgee or other person
permanently of the possession of the property; or

(3) obtains for the actor or another the possession, custody, or title to property of or
performance of services by a third person by intentionally deceiving the third person with
a false representation which is known to be false, made with intent to defraud, and which
does defraud the person to whom it is made. "False representation" includes without
limitation:

(i) the issuance of a check, draft, or order for the payment of money, except a forged
check as defined in section 609.631, or the delivery of property knowing that the actor is
not entitled to draw upon the drawee therefor or to order the payment or delivery thereof;
or

(ii) a promise made with intent not to perform. Failure to perform is not evidence of
intent not to perform unless corroborated by other substantial evidence; or

deleted text begin (iii) the preparation or filing of a claim for reimbursement, a rate application, or a cost
report used to establish a rate or claim for payment for medical care provided to a recipient
of medical assistance under chapter deleted text end deleted text begin 256B deleted text end deleted text begin , which intentionally and falsely states the costs
of or actual services provided by a vendor of medical care; or
deleted text end

deleted text begin (iv) deleted text end new text begin (iii) new text end the preparation or filing of a claim for reimbursement for providing treatment
or supplies required to be furnished to an employee under section 176.135 which intentionally
and falsely states the costs of or actual treatment or supplies provided; or

deleted text begin (v) deleted text end new text begin (iv) new text end the preparation or filing of a claim for reimbursement for providing treatment
or supplies required to be furnished to an employee under section 176.135 for treatment or
supplies that the provider knew were medically unnecessary, inappropriate, or excessive;
or

(4) by swindling, whether by artifice, trick, device, or any other means, obtains property
or services from another person; or

(5) intentionally commits any of the acts listed in this subdivision but with intent to
exercise temporary control only and:

(i) the control exercised manifests an indifference to the rights of the owner or the
restoration of the property to the owner; or

(ii) the actor pledges or otherwise attempts to subject the property to an adverse claim;
or

(iii) the actor intends to restore the property only on condition that the owner pay a
reward or buy back or make other compensation; or

(6) finds lost property and, knowing or having reasonable means of ascertaining the true
owner, appropriates it to the finder's own use or to that of another not entitled thereto without
first having made reasonable effort to find the owner and offer and surrender the property
to the owner; or

(7) intentionally obtains property or services, offered upon the deposit of a sum of money
or tokens in a coin or token operated machine or other receptacle, without making the
required deposit or otherwise obtaining the consent of the owner; or

(8) intentionally and without claim of right converts any article representing a trade
secret, knowing it to be such, to the actor's own use or that of another person or makes a
copy of an article representing a trade secret, knowing it to be such, and intentionally and
without claim of right converts the same to the actor's own use or that of another person. It
shall be a complete defense to any prosecution under this clause for the defendant to show
that information comprising the trade secret was rightfully known or available to the
defendant from a source other than the owner of the trade secret; or

(9) leases or rents personal property under a written instrument and who:

(i) with intent to place the property beyond the control of the lessor conceals or aids or
abets the concealment of the property or any part thereof; or

(ii) sells, conveys, or encumbers the property or any part thereof without the written
consent of the lessor, without informing the person to whom the lessee sells, conveys, or
encumbers that the same is subject to such lease or rental contract with intent to deprive the
lessor of possession thereof; or

(iii) does not return the property to the lessor at the end of the lease or rental term, plus
agreed-upon extensions, with intent to wrongfully deprive the lessor of possession of the
property; or

(iv) returns the property to the lessor at the end of the lease or rental term, plus
agreed-upon extensions, but does not pay the lease or rental charges agreed upon in the
written instrument, with intent to wrongfully deprive the lessor of the agreed-upon charges.

For the purposes of items (iii) and (iv), the value of the property must be at least $100.

Evidence that a lessee used a false, fictitious, or not current name, address, or place of
employment in obtaining the property or fails or refuses to return the property or pay the
rental contract charges to lessor within five days after written demand for the return has
been served personally in the manner provided for service of process of a civil action or
sent by certified mail to the last known address of the lessee, whichever shall occur later,
shall be evidence of intent to violate this clause. Service by certified mail shall be deemed
to be complete upon deposit in the United States mail of such demand, postpaid and addressed
to the person at the address for the person set forth in the lease or rental agreement, or, in
the absence of the address, to the person's last known place of residence; or

(10) alters, removes, or obliterates numbers or symbols placed on movable property for
purpose of identification by the owner or person who has legal custody or right to possession
thereof with the intent to prevent identification, if the person who alters, removes, or
obliterates the numbers or symbols is not the owner and does not have the permission of
the owner to make the alteration, removal, or obliteration; or

(11) with the intent to prevent the identification of property involved, so as to deprive
the rightful owner of possession thereof, alters or removes any permanent serial number,
permanent distinguishing number or manufacturer's identification number on personal
property or possesses, sells or buys any personal property knowing or having reason to
know that the permanent serial number, permanent distinguishing number or manufacturer's
identification number has been removed or altered; or

(12) intentionally deprives another of a lawful charge for cable television service by:

(i) making or using or attempting to make or use an unauthorized external connection
outside the individual dwelling unit whether physical, electrical, acoustical, inductive, or
other connection; or by

(ii) attaching any unauthorized device to any cable, wire, microwave, or other component
of a licensed cable communications system as defined in chapter 238. Nothing herein shall
be construed to prohibit the electronic video rerecording of program material transmitted
on the cable communications system by a subscriber for fair use as defined by Public Law
94-553, section 107; or

(13) except as provided in clauses (12) and (14), obtains the services of another with
the intention of receiving those services without making the agreed or reasonably expected
payment of money or other consideration; or

(14) intentionally deprives another of a lawful charge for telecommunications service
by:

(i) making, using, or attempting to make or use an unauthorized connection whether
physical, electrical, by wire, microwave, radio, or other means to a component of a local
telecommunication system as provided in chapter 237; or

(ii) attaching an unauthorized device to a cable, wire, microwave, radio, or other
component of a local telecommunication system as provided in chapter 237.

The existence of an unauthorized connection is prima facie evidence that the occupier
of the premises:

(A) made or was aware of the connection; and

(B) was aware that the connection was unauthorized;

(15) with intent to defraud, diverts corporate property other than in accordance with
general business purposes or for purposes other than those specified in the corporation's
articles of incorporation; or

(16) with intent to defraud, authorizes or causes a corporation to make a distribution in
violation of section 302A.551, or any other state law in conformity with it; or

(17) takes or drives a motor vehicle without the consent of the owner or an authorized
agent of the owner, knowing or having reason to know that the owner or an authorized agent
of the owner did not give consent; or

(18) intentionally, and without claim of right, takes motor fuel from a retailer without
the retailer's consent and with intent to deprive the retailer permanently of possession of
the fuel by driving a motor vehicle from the premises of the retailer without having paid
for the fuel dispensed into the vehicle; or

(19) commits wage theft under subdivision 1, clause (13).

(b) Proof that the driver of a motor vehicle into which motor fuel was dispensed drove
the vehicle from the premises of the retailer without having paid for the fuel permits the
factfinder to infer that the driver acted intentionally and without claim of right, and that the
driver intended to deprive the retailer permanently of possession of the fuel. This paragraph
does not apply if: (1) payment has been made to the retailer within 30 days of the receipt
of notice of nonpayment under section 604.15; or (2) a written notice as described in section
604.15, subdivision 4, disputing the retailer's claim, has been sent. This paragraph does not
apply to the owner of a motor vehicle if the vehicle or the vehicle's license plate has been
reported stolen before the theft of the fuel.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective August 1, 2025, and applies to crimes
committed on or after that date.
new text end

Sec. 5.

Minnesota Statutes 2024, section 628.26, is amended to read:

628.26 LIMITATIONS.

(a) Indictments or complaints for any crime resulting in the death of the victim may be
found or made at any time after the death of the person killed.

(b) Indictments or complaints for a violation of section 609.25 may be found or made
at any time after the commission of the offense.

(c) Indictments or complaints for violation of section 609.282 may be found or made at
any time after the commission of the offense if the victim was under the age of 18 at the
time of the offense.

(d) Indictments or complaints for violation of section 609.282 where the victim was 18
years of age or older at the time of the offense, or 609.42, subdivision 1, clause (1) or (2),
shall be found or made and filed in the proper court within six years after the commission
of the offense.

(e) Indictments or complaints for violation of sections 609.322, 609.342 to 609.345, and
609.3458 may be found or made at any time after the commission of the offense.

(f) Indictments or complaints for violation of sections deleted text begin 609.466 deleted text end new text begin 609.467 new text end and 609.52,
subdivision 2, paragraph (a), clause (3), item (iii), shall be found or made and filed in the
proper court within six years after the commission of the offense.

(g) Indictments or complaints for violation of section 609.2335, 609.52, subdivision 2,
paragraph (a), clause (3), items (i) and (ii), (4), (15), or (16), 609.631, or 609.821, where
the value of the property or services stolen is more than $35,000, or for violation of section
609.527 where the offense involves eight or more direct victims or the total combined loss
to the direct and indirect victims is more than $35,000, shall be found or made and filed in
the proper court within five years after the commission of the offense.

(h) Except for violations relating to false material statements, representations or
omissions, indictments or complaints for violations of section 609.671 shall be found or
made and filed in the proper court within five years after the commission of the offense.

(i) Indictments or complaints for violation of sections 609.561 to 609.563, shall be found
or made and filed in the proper court within five years after the commission of the offense.

(j) Indictments or complaints for violation of section 609.746 shall be found or made
and filed in the proper court within the later of three years after the commission of the
offense or three years after the offense was reported to law enforcement authorities.

(k) In all other cases, indictments or complaints shall be found or made and filed in the
proper court within three years after the commission of the offense.

(l) The limitations periods contained in this section shall exclude any period of time
during which the defendant was not an inhabitant of or usually resident within this state.

(m) The limitations periods contained in this section for an offense shall not include any
period during which the alleged offender participated under a written agreement in a pretrial
diversion program relating to that offense.

(n) The limitations periods contained in this section shall not include any period of time
during which physical evidence relating to the offense was undergoing DNA analysis, as
defined in section 299C.155, unless the defendant demonstrates that the prosecuting or law
enforcement agency purposefully delayed the DNA analysis process in order to gain an
unfair advantage.

Sec. 6. new text begin APPROPRIATION.
new text end

new text begin $390,750 in fiscal year 2026 and $390,750 in fiscal year 2027 are appropriated from the
general fund to the attorney general to combat medical assistance fraud under Minnesota
Statutes, section 609.467. The base for the appropriation under this section is $390,750 in
fiscal year 2028 and $390,750 in fiscal year 2029.
new text end

Sec. 7. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2024, section 609.466, new text end new text begin is repealed.
new text end

APPENDIX

Repealed Minnesota Statutes: H2354-2

609.466 MEDICAL ASSISTANCE FRAUD.

Any person who, with the intent to defraud, presents a claim for reimbursement, a cost report or a rate application, relating to the payment of medical assistance funds pursuant to chapter 256B, to the state agency, which is false in whole or in part, is guilty of an attempt to commit theft of public funds and may be sentenced accordingly.