Minnesota Plans Replacement for Fraud-Shuttered Housing Stabilization Program
Minnesota's Department of Human Services is developing a new program and a 2028 legislative proposal to replace Housing Stabilization Services (HSS), a Medicaid-funded housing navigation benefit for elderly, disabled, and substance-use-disorder populations that the state shut down last year after widespread fraud. Federal prosecutors have charged more than a dozen people in schemes totaling at least $26 million, including a case where out-of-state "tourists" collected $3.5 million in fraudulent claims, and a St. Paul agency owner was just convicted at trial in a $4.3 million scheme. The program's cost ballooned from a projected $2.6 million a year to over $104 million paid to 700-plus providers at its 2024 peak. The replacement effort is included, with limited detail so far, in a draft update to the state's Olmstead Plan, the blueprint guiding community-based living options for people with disabilities.