Letter to federal Centers for Medicare and Medicaid Services from DHS Commissioner outlines steps being taken to protect enrollees and taxpayers, requests authorization to terminate program immediately

DHS Office of Inspector General immediately stops 11 additional HSS provider payments, for a total of 77 stopped payments overall

On Friday, the Minnesota Department of Human Services (DHS), under the guidance of its own DHS Office of Inspector General (OIG), moved to terminate the Housing Stabilization Services (HSS) program. In a letter sent Friday from DHS Temporary Commissioner Shireen Gandhi to the federal Centers for Medicare and Medicaid Services (CMS), DHS requested the unprecedented step of ending the Minnesota program.

“DHS is rooting out fraud wherever we find it. We cannot allow one more cent of taxpayer money going out the door to providers who claim to serve Minnesotans in need of stable housing while lining their pockets for personal gain,” said DHS Temporary Commissioner Shireen Gandhi. “As I made clear in my letter to CMS, our own data analysis has shown that this program does not have the necessary controls to stop bad actors, and we are urging CMS to approve our request to end this program as swiftly as possible.” 

DHS intends to redesign and relaunch the benefit. Toward that effort, DHS will work with the legislature, providers, community partners, and CMS to fully redesign the program with robust program integrity and service quality requirements to prevent bad actors from entering the program and enhance care. Once that work is complete, DHS will then work with CMS to submit a new program framework for approval.

In addition to its decision to end the HSS program and terminate services, DHS announced that it had issued 11 new immediate payment withholds to HSS providers, effective July 31. To date, DHS has taken administrative action to suspend payments to a total of 77 HSS providers based upon credible allegations of fraud. The 11 new payment withholds are in addition to the 50 stopped payments already issued to HSS providers in the past month as a result of billing data analysis and investigations conducted by DHS’ Office of Inspector General.

“As our OIG data and investigations have revealed, too many fraudulent, unqualified bad actors have likely stolen money from our state’s taxpayers, and also cheated Minnesotans who need housing services,” said James Clark, DHS’ Inspector General. “The termination of this program, while regrettable for those who need these services, is the necessary step at this time.”

“We take a zero-tolerance approach to fraud and will continue to take quick action to halt payments to any provider organizations we believe have been committing fraud in our HSS program,” Gandhi stressed. “Enough is enough.”

DHS has begun work with CMS to take the required actions to end the housing stabilization services benefit as soon as possible, including required notifications to enrollees/service recipients as well as providers.

While CMS completes its required process for terminating the program, DHS will continue to use the tools created by the legislature last legislative session to monitor and evaluate the remaining HSS providers, including evaluating those who have not billed or been active in the past year, while it works to process all paperwork and implement all protocols required by CMS to fully end HSS program operations.