Attorney General Ellison wins $18.5 million Medicaid fraud settlement

NUWAY Alliance accused of paying kickbacks and double-billing Medicaid program

Minnesota to receive over $8 million from the settlement

June 26, 2025 (SAINT PAUL) — Today, Minnesota Attorney General Keith Ellison announced that his office’s Medicaid Fraud Control Unit (MFCU) and the United States Attorney’s Office have obtained a settlement agreement with NUWAY Alliance to resolve allegations that NUWAY paid kickbacks and double-billed Medicaid. The agreement requires NUWAY to pay $18.5 million for violations of law related to its delivery of intensive outpatient substance abuse disorder treatment services through the Minnesota Medical Assistance (Medicaid) program. As part of the settlement, NUWAY has also entered into a Corporate Integrity Agreement with the U.S. Department of Health and Human Services’ Office of Inspector General for continued monitoring to ensure they comply with the law.

The State of Minnesota will receive over $8 million of the settlement funds. These settlement proceeds alone cover more than 5 years of State funding for Attorney General Ellison’s MFCU. The Attorney General’s Office does not keep these funds: they are returned to the State’s General Fund.

This settlement also resolves several False Claims Act lawsuits brought against NUWAY by whistleblowers. Under the False Claims Act, a private party, known as a relator, can file a lawsuit on behalf of the government and receive a portion of any recovery. The over $8 million Minnesota will receive from the settlement equals out to 58.5% of the total settlement after the relators’ share and other fees are deducted, and any accruing interest is added.

“When someone steals from Medicaid, they are both stealing from taxpayers and stealing money meant to pay for poor people’s healthcare. That’s disgraceful and I will not stand for it,” said Attorney General Ellison. “I am proud to be holding NUWAY accountable for their wrongdoing. Medicaid does tremendous good in the lives of so many Minnesotans, and I will not allow fraudsters to plunder it for personal gain.”

“Overbilling Medicaid while shortchanging clients is indefensible,” said Department of Human Services (DHS) Temporary Commissioner Shireen Gandhi. “That is why DHS, the U.S. Attorney’s Office, and the Minnesota Attorney General’s Medicaid Fraud Control Unit worked together to root out abuse of an essential program. Today’s settlement not only requires NUWAY to make a substantial payback to taxpayers, it protects the rights of clients to choose a provider that is right for them and receive the services being billed. The DHS Office of Inspector General provided extensive investigative data and information to our partners to ensure monetary recovery. This investigation and settlement are direct results of the ongoing partnership between state and federal offices and evidence of our shared commitment to work together for program integrity.”

From January 1, 2019 through February 21 2025, NUWAY knowingly and willfully paid kickbacks to Medicaid recipients to induce them to receive services from NUWAY for intensive outpatient substance abuse disorder treatment services.  NUWAY’s conduct violated the Federal Anti-Kickback Statute, resulting in false claims to be submitted to Medicaid and paid by the Minnesota Department of Human Services.

From January 1, 2020 through September 4, 2024, NUWAY separately billed Medicaid for multiple substance abuse disorder treatment services during the same period of time. This double billing resulted in the Minnesota Department of Human Services overpaying NUWAY for Medicaid-funded services that were not provided as claimed.

The claims resolved by these settlements are allegations only; there has been no determination of liability or wrongdoing.

Throughout the investigation of NUWAY, attorneys, investigators, and analysts from the Minnesota Attorney General’s Office’s MFCU partnered with federal law enforcement, including the FBI and Department of Health and Human Services’ Office of Inspector General (DHHS/OIG), and the United States Attorney’s Office. Attorneys, analysts, and investigators with the Minnesota Attorney General’s Office participated in interviews with key figures in the investigation, analyzed data, conducted additional investigative activities, and participated in settlement negotiations on behalf of the State.

Attorney General Ellison’s Medicaid Fraud Control Unit works to uncover, investigate, and prosecute individuals or organizations that steal from Medicaid. The Medicaid Fraud Control Unit receives 75% of its funding from the U.S. Department of Health and Human Services under a grant award totaling $4,409,872 for Federal fiscal year (FY) 2025.  The remaining 25%, totaling $1,469,955 for FY 2025, is funded by the State of Minnesota.