After Minnesota’s runaway fraud, Congress proposes tripwires
One of the disappointments of Minnesota’s sprawling fraud scandal is that it might be just another issue that taps into our hyper political partisanship and brute tribalism. What I mean is that some might only care about the fraud for the sake of punishing political opponents and others dismiss it because their so-called side is a target.
A new bill from Sen. Joni Ernst tries to cut through some of that by focusing on the mechanics with early-warning “tripwires” and stronger recovery requirements to claw back stolen taxpayer funds.
The proposal would tighten how federal child-care dollars are paid out, pushing states to reimburse providers based on documented attendance (not just enrollment) and emphasizing payment after services are delivered. It also adds record-keeping expectations so auditors can verify what actually happened. On the health-care side, the bill would require states to notify HHS when certain costs or billing volumes spike dramatically, an attempt to catch suspicious “surges” before they become billion-dollar disasters.
Those are needed guardrails. But the deeper lesson isn’t just catch and punish more fraud. Tripwires are an effective tactic for warfare but you don’t win a war against fraud with mines or booby traps alone.
There is certainly a need for a lot more Congressional oversight in America today but program design matters, too. When money flows from taxpayers to Washington and back through complex pass-through structures, accountability can get blurry, and that creates an environment where the scammers thrive. A serious reform agenda should pair better detection and clawbacks with federalism-minded simplification: clearer responsibility, fewer middle layers, and more authority closer to outcomes, without sacrificing transparent audits and real consequences for abuse. In short, the best long-term solution is to push states to appropriate more dollars for their own programs without all the D.C. tentacles and control.
That Sen. Ernst’s bill to protect the federal taxpayer against fraud is likely considered partisan further highlights the dilemma to combating fraud in our political environment today. How do we get state lawmakers care more? Diffuse power and politics to the states. I guarantee Minnesotans are more apt to punish those in power and those that committed the fraud if they are on the hook for the majority of the costs.
—Ray Nothstine
— The Federalism Beat