Minnesota Moratorium on Home Care Licenses For Disabled, Elderly

St. Paul, MN (MinnesotaNow) - In an apparent response to ongoing efforts to curb government fraud, the State of Minnesota has ordered a moratorium on issuing new licenses for home and community-based services.

According to the Minnesota Department of Human Services (DHS), the agency will stop accepting applications for 245D licenses on January 1 and expects the moratorium to remain in place for one year. The license is required for providers who offer “services to people with disabilities and those over 65” in their homes or in community settings, such as group homes. DHS says most of the services are funded under state Medicaid waiver programs.

Moratorium Impacts Medicaid Waiver Programs

In addition to the moratorium on new licenses, the state is also halting approval of new service lines for currently licensed providers and is canceling all applications that have been submitted but not yet approved.

Get our free mobile app

245D Applications Up 283% in Five Years

An internal DHS memo obtained by Twin Cities media outlets indicates the decision stems from a massive increase in the number of applications that “adversely impact the agency’s ability to provide necessary monitoring and reviews.” According to the memo, the number of new license applications has increased by more than 283% over the past five years. During the same period, the number of people receiving services under the state’s waiver programs has increased by only about 25%.

The document says the new policy does allow for exceptions to “ensure people across Minnesota can access the services they need.” The memo states DHS plans to finalize and publicly release the process and criteria for granting exceptions before January 1.

Licensing Moratorium Coincides With State Crackdown on Fraud

It goes on to say, “DHS recognizes that implementing a temporary moratorium on a license type as broad as 245D will have far-reaching impacts. During the 24-month moratorium, DHS will focus licensing efforts on reconnecting with and reviewing providers that have not been evaluated in over three years to reestablish compliance with federal waiver plans, and on identifying post-moratorium strategies to ensure a flow of new applicants that better aligns with statewide service needs. DHS will also evaluate throughout the two-year period whether any additional reforms are needed to improve licensing oversight and will provide updates to the Legislature on these issues as well as any community capacity needs.”