Minnesota shutdown threatens insurance regulators, could put consumers at risk

Minnesota State Capital BuildingThe government of Minnesota is on the verge of a shutdown, which does not bode well for some of the state’s insurance regulators. According to Judge Kathleen Gearin of Ramsey County, whom is overseeing state spending during a shutdown, insurance investigators are not to be considered critical to the function of the state’s government. Gearin has denied requests to fund fraud investigation upon the recommendation of Kathleen Blatz, special master in the shutdown hearings.

Minnesota’s shutdown has loomed on the horizon for several months now, yet neither Democrats nor Republicans have shown initiative to solve the issue. In fact, there is little sense of urgency coming from state legislators at all. Since blowing past both the May and June deadlines for establishing a working budget, lawmakers have only met twice, with each meeting amounting to less than 30 minutes. In the meantime, more than 22,000 state workers may lose their jobs, work on 100 road projects will be halted and all of the state’s parks will be barricaded. Currently, there is no sign that the issue will be solved.

Several insurance fraud investigations will be put on hold during a shutdown, meaning that those suspected of fraud will no longer be restricted in their actions. If the cases are deemed significant enough, the federal government may take charge of the investigations, but there is little else that can be done in the event of a shutdown. Without  sufficient regulatory presence in the state, regulators fear that less reputable or so called fly-by-night insurers may take advantage of the situation.

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