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Minnesota Legislature

Office of the Revisor of Statutes

256B.064 SANCTIONS; MONETARY RECOVERY.
    Subdivision 1. Terminating payments to ineligible vendors. The commissioner may
terminate payments under this chapter to any person or facility that, under applicable federal
law or regulation, has been determined to be ineligible for payments under Title XIX of the
Social Security Act.
    Subd. 1a. Grounds for sanctions against vendors. The commissioner may impose sanctions
against a vendor of medical care for any of the following: (1) fraud, theft, or abuse in connection
with the provision of medical care to recipients of public assistance; (2) a pattern of presentment
of false or duplicate claims or claims for services not medically necessary; (3) a pattern of making
false statements of material facts for the purpose of obtaining greater compensation than that to
which the vendor is legally entitled; (4) suspension or termination as a Medicare vendor; (5)
refusal to grant the state agency access during regular business hours to examine all records
necessary to disclose the extent of services provided to program recipients and appropriateness of
claims for payment; (6) failure to repay an overpayment finally established under this section;
and (7) any reason for which a vendor could be excluded from participation in the Medicare
program under section 1128, 1128A, or 1866(b)(2) of the Social Security Act. The determination
of services not medically necessary may be made by the commissioner in consultation with a
peer advisory task force appointed by the commissioner on the recommendation of appropriate
professional organizations. The task force expires as provided in section 15.059, subdivision 5.
    Subd. 1b. Sanctions available. The commissioner may impose the following sanctions for
the conduct described in subdivision 1a: suspension or withholding of payments to a vendor and
suspending or terminating participation in the program. Regardless of imposition of sanctions, the
commissioner may make a referral to the appropriate state licensing board.
    Subd. 1c. Grounds for and methods of monetary recovery. (a) The commissioner may
obtain monetary recovery from a vendor who has been improperly paid either as a result of
conduct described in subdivision 1a or as a result of a vendor or department error, regardless of
whether the error was intentional. Patterns need not be proven as a precondition to monetary
recovery of erroneous or false claims, duplicate claims, claims for services not medically
necessary, or claims based on false statements.
(b) The commissioner may obtain monetary recovery using methods including but not
limited to the following: assessing and recovering money improperly paid and debiting from
future payments any money improperly paid. The commissioner shall charge interest on money to
be recovered if the recovery is to be made by installment payments or debits, except when the
monetary recovery is of an overpayment that resulted from a department error. The interest
charged shall be the rate established by the commissioner of revenue under section 270C.40.
    Subd. 1d. Investigative costs. The commissioner may seek recovery of investigative costs
from any vendor of medical care or services who willfully submits a claim for reimbursement for
services that the vendor knows, or reasonably should have known, is a false representation and
that results in the payment of public funds for which the vendor is ineligible. Billing errors that
result in unintentional overcharges shall not be grounds for investigative cost recoupment.
    Subd. 2. Imposition of monetary recovery and sanctions. (a) The commissioner shall
determine any monetary amounts to be recovered and sanctions to be imposed upon a vendor
of medical care under this section. Except as provided in paragraphs (b) and (d), neither a
monetary recovery nor a sanction will be imposed by the commissioner without prior notice and
an opportunity for a hearing, according to chapter 14, on the commissioner's proposed action,
provided that the commissioner may suspend or reduce payment to a vendor of medical care,
except a nursing home or convalescent care facility, after notice and prior to the hearing if in the
commissioner's opinion that action is necessary to protect the public welfare and the interests
of the program.
(b) Except for a nursing home or convalescent care facility, the commissioner may withhold
or reduce payments to a vendor of medical care without providing advance notice of such
withholding or reduction if either of the following occurs:
(1) the vendor is convicted of a crime involving the conduct described in subdivision 1a; or
(2) the commissioner receives reliable evidence of fraud or willful misrepresentation by
the vendor.
(c) The commissioner must send notice of the withholding or reduction of payments under
paragraph (b) within five days of taking such action. The notice must:
(1) state that payments are being withheld according to paragraph (b);
(2) except in the case of a conviction for conduct described in subdivision 1a, state that the
withholding is for a temporary period and cite the circumstances under which withholding will
be terminated;
(3) identify the types of claims to which the withholding applies; and
(4) inform the vendor of the right to submit written evidence for consideration by the
commissioner.
The withholding or reduction of payments will not continue after the commissioner
determines there is insufficient evidence of fraud or willful misrepresentation by the vendor, or
after legal proceedings relating to the alleged fraud or willful misrepresentation are completed,
unless the commissioner has sent notice of intention to impose monetary recovery or sanctions
under paragraph (a).
(d) The commissioner may suspend or terminate a vendor's participation in the program
without providing advance notice and an opportunity for a hearing when the suspension or
termination is required because of the vendor's exclusion from participation in Medicare.
Within five days of taking such action, the commissioner must send notice of the suspension or
termination. The notice must:
(1) state that suspension or termination is the result of the vendor's exclusion from Medicare;
(2) identify the effective date of the suspension or termination;
(3) inform the vendor of the need to be reinstated to Medicare before reapplying for
participation in the program; and
(4) inform the vendor of the right to submit written evidence for consideration by the
commissioner.
(e) Upon receipt of a notice under paragraph (a) that a monetary recovery or sanction is to be
imposed, a vendor may request a contested case, as defined in section 14.02, subdivision 3, by
filing with the commissioner a written request of appeal. The appeal request must be received by
the commissioner no later than 30 days after the date the notification of monetary recovery or
sanction was mailed to the vendor. The appeal request must specify:
(1) each disputed item, the reason for the dispute, and an estimate of the dollar amount
involved for each disputed item;
(2) the computation that the vendor believes is correct;
(3) the authority in statute or rule upon which the vendor relies for each disputed item;
(4) the name and address of the person or entity with whom contacts may be made regarding
the appeal; and
(5) other information required by the commissioner.
History: 1973 c 717 s 6; 1976 c 188 s 1; 1980 c 349 s 5,6; 1982 c 424 s 130; 1983 c 312
art 5 s 17; 1987 c 370 art 1 s 4; 1987 c 403 art 2 s 81; 1988 c 629 s 52; 1991 c 292 art 5 s
29; 1992 c 513 art 7 s 51,52; 1997 c 203 art 4 s 30-32; 2000 c 400 s 1; 1Sp2003 c 14 art 2 s
17; 2005 c 151 art 2 s 17