Medicare glitch, UCare collapse push Mille Lacs hospital toward closure

Mille Lacs Health System in Onamia says it is staring at a $4 million shortfall and "running out of savings" after Medicare and defunct insurer UCare failed to pay millions in legitimate claims, putting yet another Minnesota hospital on the brink. CEO Andy Knutson told FOX 9 that a Medicare "technical glitch" inexplicably deactivated several providers in the federal system, causing every visit tied to them to be rejected and leaving nearly $3 million in services unpaid; UCare, seized by the state last year, still owes the hospital about $1 million more. With about 60% of its revenue coming from Medicare, the system is now seeking bank lines of credit just to keep the doors open and openly doubts federal assurances that the backlog has been fixed, saying, "We’ll believe it when we see it." The story also notes that Hennepin Health’s HCMC in downtown Minneapolis is simultaneously warning it may have to close without legislative help, underlining that both rural and core‑metro hospitals are being squeezed by the same mix of federal failures and insurer collapse. For Twin Cities residents, the message is that the safety‑net hospital crisis at HCMC isn’t happening in isolation — the broader payment system feeding into Minneapolis care is cracking at multiple points, and if Mille Lacs folds it will push more patients back into already strained metro facilities.