Upcoming regulatory changes, increased operating costs and staffing challenges are forcing a St. Paul-based home health care company to wind down operations. It’s a troubling development. Does it portend more closings in the future?
Dependable Home Health Care, which has offices in the capital city’s Empire Builder Business Park, filed its notice of closing in early November. The filing with the Minnesota Department of Employment and Economic Development (DEED) indicated that layoffs will take place in six phases between January and March 2026.
Client care will wind down by end of January. Caregivers will be done on February 6. Administrative staff layoffs will continue into mid-March.
Dependable Home Health Care was founded in 1991. The company provides in-home caregiver services to people with disabilities and elders.
More than 400 jobs will be affected. One media report indicated that 368 workers are in direct contact with clients as direct support professionals, personal care assistants, support workers and program assistants.
A worker who didn’t want her name used said that she and others were shocked to learn of the closing. She is concerned about finding another job, but is more worried about her disabled clients and what will happen to them as they try to find new care options.
The company has indicated that it will work with employees to find new jobs. The company will also work with their clients and client families to get through a transition without interrupting care.
“Based on business challenges and upcoming regulatory changes impacting the Minnesota home care industry, Dependable has made the decision to close the company permanently,” Dependable Home Health Care CEO Katie Fleury stated in a letter to DEED announcing the closing. Reductions in allowable service hours and lower rates for overnight care are among those changes.
But the Minnesota Department of Human Services (DHS) issued a statement, saying it received notice of the company’s closure before the state’s audit program of numerous programs was announced. Gov. Tim Walz in late October announced a third-party audit and paused payments for more than a dozen programs, as a means of detecting Medicaid fraud. (See related story.) Minnesota officials have cautioned that the audit could result in payments being delayed up to 90 days, even for services that are found to be in compliance.
According to DHS, most of the services Dependable Home Health Care provides would not have been subject to pre-payment review.
Minnesota has lost several Personal Care Assistant (PCA) agencies over the past decade. Another high-profile closure was in May 2023 when St. Louis Park-based Ability Care Partners shut down. The agency cited the many challenges it faced in recent years, especially with the transition from PCA to Community First Supports and Services.
The ongoing staffing crisis and challenges in hiring, have hampered many personal care agencies over the years. Some have shut down while others have had to limit the services provided.
Many agencies that haven’t billed for services for a time also face shutdowns. Medicaid providers who have not billed for services in more than a year are being disenrolled from the state’s program, as DHS tightens its oversight.
The first round of disenrollment began in mid-October, when roughly 800 providers were disenrolled. Impacted providers were certified prior to April 1, 2024, and have not billed since that date. This round of disenrollments does not include 621 inactive housing stabilization services providers because that program was slated to end October 31.
“We must reduce risk and increase efficiencies wherever we can,” said Temporary Human Services Commissioner Shireen Gandhi. “Taking this first step to streamline the pool of inactive providers will strengthen the integrity of Minnesota’s Medicaid programs and services.”
The action strengthens program integrity by reducing the administrative burden and compliance challenges of overseeing providers who aren’t providing services. The change ensures that Medicaid resources focus on providers who are actively serving members of Minnesota’s public health care programs. Walz ordered DHS to “immediately disenroll all Minnesota Health Care Program enrolled providers who have not billed Medicaid in the last 12 months,” within the bounds of the law. Additional rounds of disenrollments will continue. Providers will be offered an appeals process if it is believed that a disenrollment was made erroneously.
