ST. PAUL, October 12 — A federal jury convicted Sharmaine Meadows of Lake Elmo on three counts of health care fraud for a $3.6 million scheme targeting Minnesota’s Medicaid Housing Stabilization Services Program. The verdict, delivered in St. Paul, marks the conclusion of a case that exposed systemic vulnerabilities in a program meant to help unhoused residents secure and maintain stable housing. Meadows, 45, owned and operated a company that billed the state for services never rendered between 2020 and 2025.
Prosecutors presented evidence that her firm claimed payment for in-person hours worked by employees who were physically located outside Minnesota, including in Illinois and the Philippines. Workers in the Philippines were paid $6 an hour with no benefits, according to trial testimony.
The company also billed for services that could not have been delivered due to beneficiaries being hospitalized at the time of service. The Housing Stabilization Services Program allowed approved providers to bill up to 150 hours for transitional services and 150 hours for sustaining services per eligible recipient. Meadows’ company exploited this structure by submitting claims indicating employees worked more than 20 hours a day for extended periods — a pattern prosecutors said was impossible and indicative of fraud.
Beneficiaries testified they received little to no assistance from the company despite being told they had exhausted their available program hours. Over the course of the scheme, the program paid Meadows’ company more than $3.6 million into accounts she controlled.
The funds were deposited into accounts under her direction, prosecutors said, and used for personal benefit. No evidence was presented at trial suggesting the money was reinvested into legitimate service delivery or passed through to frontline workers beyond the low wages paid overseas. Meadows was convicted on three counts of health care fraud.
Each count carries a maximum penalty of 10 years in prison under federal sentencing guidelines. Sentencing has not yet been scheduled and will be determined by a federal district judge, who will consider advisory guidelines and statutory factors. No prior criminal history or personal background details for Meadows were disclosed during the trial or in public filings related to the case.
The investigation was led by the FBI, with support from the Department of Health and Human Services Office of Inspector General and the IRS Criminal Investigation division. The case was announced by Assistant Attorney General Colin M.
McDonald of the Justice Department’s Fraud Division and U.S. Attorney Daniel N. Rosen for the District of Minnesota. Following the conviction, officials confirmed the Housing Stabilization Services Program has been defunct and is no longer accepting new claims or enrolling providers.
Medicaid fraud remains a focal point for federal oversight, particularly in programs serving vulnerable populations. This case underscores the risks associated with remote billing oversight and the challenges of verifying service delivery in home- and community-based waiver programs.
Investigators said they will continue to monitor similar programs for anomalies in billing patterns, especially those involving high hourly claims or international subcontracting. Going forward, stakeholders will watch for any administrative changes to Minnesota’s Medicaid waiver programs and potential legislative responses aimed at strengthening audit controls. The outcome may also influence how federal authorities assess risk in other state-run housing stabilization initiatives.
No further legal actions against Meadows’ company or associated entities have been announced at this time.
