MNsure Should Refund $1.2M To Feds, Audit Says

Nov. 29--A federal audit says MNsure improperly spent $1.2 million in federal grants, but the state-run health insurance exchange is disputing most of the findings.

The audit examined part of the $86.4 million in federal grant money MNsure spent through June 30, 2014, as it was preparing to launch in late 2013. In particular, the U.S. Department of Health and Human Services' Office of Inspector General focused on $930,000 in marketing spending and $346,000 in "establishment grants" to help build MNsure.

The $346,000 was part of a broader $1.8 million expenditure divided between MNsure and public health programs such as Medicaid. The audit claims MNsure used old data to divide up the money and so improperly took $346,000 that should have gone to public programs if better data had been used. In a response, MNsure said the data was current at the time and criticized what it called a "retroactive" application of the new data.

The bigger chunk of money concerned $930,000 in marketing money that the federal audit says was authorized by an official without authority to do so under federal and state requirements. MNsure said it had changed its contracting procedures to prevent this from happening again, but argued that any violation was minor.

"When viewed in the proper context and in light of remedial steps taken by MNsure, it is clear that requesting a refund of the amount involved to (the federal government) would not only harm MNsure, but would be an extreme measure" that would hurt MNsure's mission to help people purchase health care, the exchange said in its reply.

The Inspector General's report stood by its conclusion.

The federal Centers for Medicare and Medicaid Services will decide whether MNsure should be forced to repay the money.

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