Minnesota Pauses Disability Services Licensing During Fraud Investigations

hireen Gandhi. (Photo by Michele Jokinen/House Public Information Services via Minnesota Reformer)

(Minnesota Reformer) – The Minnesota Department of Human Services has issued a two-year moratorium on licensing for Home and Community-Based Services, a Medicaid program that helps people with disabilities receive care in their home or a community, such as group homes, instead of in nursing homes or hospitals.

DHS will stop issuing new licenses and cancel existing applications starting in January, according to a letter from the agency’s Temporary Commissioner Shireen Gandhi to lawmakers dated Monday. The Legislature passed a law this year allowing DHS to pause licensing if it finds that new applications are growing beyond program needs.

There are currently 2,549 active licenses and 2,314 pending applications as of mid-November, according to the letter. Compared to 2015-2019, the past five years have seen an increase in disability waiver recipients, i.e., people who need services, of 25%, much smaller than the 55% increase in the average annual number of licenses and 283% increase in new applications for licenses. Gandhi said DHS compared the growth in provider licenses to the growth in people seeking services to conclude that it should no longer accept new applications.

Still, providers warned that the decision will harm the disability community. A statement from the Association of Residential Resources in Minnesota, which represents disability service providers, said they were only notified Tuesday, and that the “sweeping, system-altering policy” decision was made “in complete secrecy.”