Hellmuth & Johnson attorney Brendan M. Kenny successfully defeated a motion to dismiss brought by the Minnesota Department of Human Services (DHS) in a case challenging DHS’s long‑running withholding of Medicaid payments from a health care provider. The Ramsey County District Court held that, under Minnesota Statutes, section 256B.064, subdivision 2(b), the provider is entitled to a contested case hearing to challenge DHS’s temporary payment withholding based on alleged “credible allegations of fraud.”
The petitioner, an Early Intensive Developmental and Behavioral Intervention (EIDBI) provider serving children and young adults with autism or related conditions, had never been sanctioned or subject to administrative action by DHS. After DHS issued a notice stating that it was temporarily withholding all Medicaid payments because it believed the provider had “billed for services not provided or not provided as billed,” the provider’s operations were effectively shuttered, and it was told there was no deadline to conclude the fraud investigation and no right to a hearing.
In response, Mr. Kenny sought mandamus relief, arguing that DHS was obligated to afford the provider an opportunity for a contested case hearing under section 256B.064. The court agreed in significant part, ruling that while DHS may proceed under section 256B.064 rather than the newer, more general statute section 15.013, the provider retains a hearing right to address the temporary payment withholding and DHS’s credible‑allegation‑of‑fraud determination. The court therefore denied dismissal of the provider’s core claim and allowed the case to go forward so the provider can obtain an administrative hearing on DHS’s actions.
If you would like to discuss legal issues involving Minnesota Health Care Programs, Medicaid payment withholds, or contested case hearings before DHS, please contact Mr. Kenny’s Angela Lund at [email protected] or (952) 460‑9260