Home and Community Based Service Provider (HCBS)
Change of Ownership Procedure

The Louisiana licensing regulations for Home and Community Based Service Providers (HCBS) states that a change of ownership (CHOW) of an HCBS provider shall be reported in writing to the department within five working days of the change.  The license of an HCBS provider is not transferable or assignable and cannot be sold.  If the CHOW is accepted and processed by the LDH Health Standards Section (HSS), the new owner will be issued a new license. The new owner is not eligible to bill Medicaid for services until their license is issued and they have submitted the necessary provider enrollment forms to the Molina Healthcare Provider Enrollment section. If the CHOW results in a change of geographic address, an on-site survey may be required prior to issuance of the new license.           

It is important to note that if an HCBS Provider is providing PCA, SIL or Respite services and wishes to undergo a CHOW, the prospective NEW owner shall be required to do the following two procedures simultaneously (at the same time):

1. The prospective NEW owner of an HCBS agency shall submit a new Facility Need Review (FNR) application to the department’s FNR program manager. The FNR application shall be accompanied by a letter of intent to purchase an HCBS agency.  The specific HCBS agency shall be identified on both the FNR application and in the letter of intent. There is an FNR application fee of $200. FNR approval for the new owner shall be granted upon submission of the new application and proof of the change of ownership, which must show the seller’s or transferor’s intent to relinquish the FNR approval to the prospective new owner.

A copy of the FNR application, instructions and a copy of the FNR rule can be found at http://new.dhh.louisiana.gov/index.cfm/newsroom/detail/1687

2.  Additionally, the prospective NEW owner shall submit to HSS the following documents: 

  • A letter of intent to purchase the agency
  • The legal transaction between the buyer and seller such as a bill of sale 
    • Due diligence on the part of all prospective buyers is expected prior to signing an act of sale. Failure to do so may result in the departments' denial of the CHOW. Buyers are strongly encouraged to investigate whether the current owner may be under IRS liens or recoupment of payments made by Medicaid. a new owner could assume liability for the resolution of these matters.
  • All documents required for a new license to include:
    • HCBS license application and non-refundable fee
    • Disclosure of ownership
    • Proof of financial viability to include:
      • Workman’s compensation insurance
      • $50,000 line of credit issued from a federally insured, licensed lending institution
      • General and professional liability insurance of at least $300,000
      • If center based services such as Adult Day Care or Center Based Respite are also being acquired in the change of ownership, then the perspective NEW owner will be required to submit approval from the Office of Public Health and the Office of the State Fire Marshall approvals for occupancy.  Such approvals from these agencies shall contain the new name of the center based services.
      • Floor plans if center based services are to be provided
      • Criminal background check for the new owner and Administrator from either the Louisiana State Police or one of their authorized agents.
      • Certificates showing completion of the provider training videos located on the HCBS web page for Provider Training Resources found at http://dhh.louisiana.gov/index.cfm/page/1790 

Once all application requirements are completed and approved by the department, a new license shall be issued to the new owner.

A CHOW will not be processed if the current owner (seller) meets any of the following: 

  • Is under license revocation;
  • Is under investigation by the State Attorney General's office;
  • Is excluded from participation in the Medicaid program or under vendor hold;
  • Is under penalties imposed by the IRS or other federal or state agency or
  • Has ceased to operate and does not meet operational requirements to hold a license as defined by Section 5031, Business Location, of HCBS licensing standards.