Today saw the launch of Minnesota’s paid family and medical leave (PFML) program. Eligible workers will be able to take 20 weeks paid leave each year for family or medical reasons, funded by a new payroll tax.
The launch of PFML comes just as the full scale of the fraud perpetrated against welfare programs administered in Minnesota is becoming apparent.
A couple of weeks ago, the Star Tribune — which is published by a former member of Gov. Walz’ cabinet — poured cold water on the notion that “billions” of dollars of taxpayer’s money had been stolen. The true number, the Star Tribune reported, was $152 million, before correcting this to $218 million a couple of days later when it became apparent how shoddy was their attempt to cover for the state government. The ink was barely dry on this edition, when US Attorney Joe Thompson announced that “half or more” of the $18 billion paid out by 14 Medicaid programs run by the state Department of Human Services (DHS) since 2018 had been lost to fraud.
And now comes PFML. Fox News reports:
Critics on social media in recent days have expressed doubt about the safeguards put in place to prevent fraudsters from exploiting the new law given the massive scandal in Minnesota’s nonprofit and welfare programs, which prosecutors say could total $9 billion.
“In the middle of a massive fraud scandal, Minnesota Democrats are bragging about creating a new entitlement just as ripe for abuse,” Red State writer Bonchie posted on X. “The scheme involves businesses forced to pay a premium, with the state paying workers for 20 weeks of ‘paid leave.’ Are Minnesotans tired yet?”
Bill Glahn, a policy fellow at the Center of the American Experiment, who has been at the forefront of fraud coverage in Minnesota for many years, told Fox News Digital he has been “describing this as the next billion-dollar fraud.”
Glahn explained that Republicans previously refused to even hear similar proposals when they controlled the Minnesota House, but that Democrats passed the law after gaining full control, without any Republican support. Instead of using private insurance companies to administer paid leave, Glahn is faulting Democrats for creating an entirely new state-run bureaucracy staffed by hundreds of unionized government employees.
“This is going to be just like all these Medicaid programs that they start de novo, where they say, ‘Oh, we’ll probably have two or three million dollars worth of claims on this,’ and then it quickly balloons up to 100, 200 million,” Glahn said.
Glahn outlined several ways the system could be exploited, including fake companies, fake employees, minimal contributions followed by large benefit claims and multiple people claiming paid leave to care for the same relative without any realistic oversight. Because claims are tied to private homes rather than centralized locations, he argues that fraud detection is practically impossible.
Glahn also warns that individuals could work briefly, qualify, then repeatedly claim long periods of paid leave, effectively getting paid for a full year while working only part of it and explained that Minnesota has a pattern of creating new entitlement programs that attract fraudsters who quickly identify loopholes and overwhelm oversight.
Fox News reports a spokesperson for the Minnesota Department of Employment and Economic Development stating that: “Paid Leave has launched with strong systems in place to verify identities and work histories and to detect and prevent fraud.” But that was supposed to be the case for those other 14 programs that got rinsed for $9 billion.
