State declares moratorium on group homes for disabled. Providers say they're 'blindsided.'

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Residential Services was just a few months away from opening a new respite home for children in Virginia, Minn., said Jon Nelson, the Duluth agency’s executive director. He’d been working for months with St. Louis County to create a small haven, a place where kids with behavioral or mental health challenges could ease back into the community after hospital stays. The respite home would give beleaguered parents a chance as well to catch their breaths without sending their kids to foster care.

Then the Minnesota Department of Human Services (DHS) pulled the rug out from under him, Nelson said.

On Tuesday, in its ongoing efforts to fight fraud in state programs, DHS announced a two-year moratorium on new group homes for providers of Home and Community-Based Services that allow people with disabilities to live in the community. The ban also applies to new programs run by organizations that already have a license. The moratorium followed a September executive order issued by Gov. Tim Walz that directed DHS to take several measures to combat fraud, including a moratorium on new licenses and programs.

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But the moratorium announced this week is an overcorrection, providers say, and their reaction, from Moorhead to Mankato, was swift — and angry. “This comes completely out of the blue,” said Sue Schettle, CEO of the Association of Residential Resources in Minnesota, a group that represents providers and advocates of community-based services for disabled people.

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State officials on Thursday, however, pushed back. A moratorium was no surprise, DHS officials said in a statement. The Legislature in July gave them the authority to do it and, in August, DHS “provided information about this new authority to all license holders and provider organizations.”

Shannon Bock, executive director of CCRI, a service provider in Moorhead, said the moratorium will hit especially hard in rural areas, which don’t have enough providers to meet client needs. One residential program for people with disabilities has a 50-person waiting list, she said. The waiting list for 24-hour services in the community is 100 people long.

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https://www.startribune.com/providers-decry-state-moratorium-for-new-disability-group-homes-programs/601538754