MINNEAPOLIMEDIA NEWS | Minnesota Makes Prison Presumptive for Medicaid Fraud Exceeding $1 Million

ST. PAUL, MN (August 4, 2026). People convicted of defrauding Minnesota’s Medicaid program of more than $1 million will now face a presumptive prison sentence under state sentencing guidelines that took effect August 1.

The Minnesota Sentencing Guidelines Commission assigned the newly created offense a Severity Level 8 classification, elevating it from an initially proposed Severity Level 7 designation.

For a person with no previous criminal-history points, the Level 8 classification produces a presumptive 48-month commitment to state prison.

A Level 7 designation would have produced a presumptive stayed sentence of 36 months for a person with no criminal-history points. That would generally mean probation, with imprisonment possible if the person violated the terms of the stayed sentence.

The commission adopted the higher classification following a request from Minnesota Attorney General Keith Ellison.

How Presumptive Sentencing Works

A presumptive sentence is the punishment recommended under Minnesota’s sentencing grid based on the severity of the offense and the defendant’s criminal history.

It does not eliminate judicial authority or guarantee that every person convicted will receive an identical sentence.

District court judges determine individual sentences and possess limited authority under Minnesota law to depart upward or downward when legally sufficient circumstances exist. Judges generally must explain departures from the presumptive sentence.

A defendant with previous criminal-history points could face a different presumptive sentence from someone with no prior record.

The new classification nevertheless represents a significant change because imprisonment, rather than probation, becomes the presumptive outcome across the criminal-history grid for the highest-level Medicaid fraud offense.

A New Tier for Large Fraud Cases

The Medical Assistance Protection Act, passed by the Legislature earlier this year, created separate criminal tiers for fraud exceeding $100,000 and fraud exceeding $1 million.

Minnesota administers Medicaid under the name Medical Assistance.

Before the legislation, state law treated Medicaid fraud above $35,000 under the same penalty structure regardless of how far the amount exceeded that threshold. Someone accused of stealing $35,001 therefore faced the same statutory category as someone accused of stealing several million dollars.

The new law differentiates large and exceptionally large fraud schemes.

The legislation also adds Medical Assistance fraud to Minnesota’s racketeering statute, expands the period available for bringing certain prosecutions and strengthens the state’s ability to recover money obtained through fraud.

Additional Investigators and Prosecutors

The legislation expands the Attorney General’s Medicaid Fraud Control Unit from 32 to 50 employees.

The 18 additional positions include 11 investigators, three attorneys and four support employees. The Attorney General’s Office said fraud referrals to the unit have nearly tripled, creating a need for greater investigative capacity.

The law also gives the office authority to subpoena financial records during criminal Medical Assistance fraud investigations.

Ellison said the strengthened penalties recognize that Medicaid fraud harms both taxpayers and residents who depend on publicly financed health care.

“Medicaid fraud robs Minnesota taxpayers, and it steals money meant to provide healthcare to our low-income neighbors,” Ellison said in the official announcement.

The Sentencing Commission initially planned to classify fraud exceeding $1 million at Severity Level 7. Ellison urged the commission in a July 15 letter to raise the offense to Level 8.

The commission considered the recommendation during a July 23 meeting before releasing its final 2026 sentencing guidelines.

Why This Matters

Medicaid funds medical care, disability services, long-term care and other essential support for more than one million Minnesotans.

Fraud removes money from that system and can undermine public confidence in programs designed to serve children, older adults, people with disabilities and families with limited incomes.

At the same time, sentencing policy must be described accurately. The new guidelines do not impose an automatic four-year sentence in every case. They establish imprisonment as the presumptive outcome, with the precise sentence determined by the offense level, criminal history, case circumstances and applicable law.

The Severity Level 8 designation gives Minnesota prosecutors a significantly stronger sentencing framework for future cases involving losses exceeding $1 million. It also marks the point at which the Legislature’s broader Medicaid fraud legislation moves from policy approval into practical criminal enforcement.

The complete 2026 guidelines are available from the Minnesota Sentencing Guidelines Commission.

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