Minnesota woman convicted of $3.6M Medicaid housing fraud in St. Paul federal court

A federal jury in St. Paul has convicted a Minnesota woman of three counts of health care fraud for a scheme to steal $3.6 million from the now-defunct Minnesota Medicaid Housing Stabilization Services (HSS) Program, the Justice Department announced.

Sharmaine Meadows, 45, of Lake Elmo, Minnesota, billed the program for housing services meant to move unhoused people into housing and help them stay there, according to court documents and evidence presented at trial. Those services were not actually provided, the department said.

The program allowed providers to bill up to 150 hours of transitional services and 150 hours of sustaining services per eligible Medicaid beneficiary. Prosecutors said Meadows routinely told employees to maximize billings to that cap, even if the hours were never worked.

Evidence at trial showed Meadows and her company billed for in-person services supposedly provided by employees who were in other states, such as Illinois, and other countries, such as the Philippines. The department said employees in the Philippines were paid $6 per hour and explicitly offered no benefits.

Meadows also submitted claims for services that could not have been provided because beneficiaries were in the hospital, prosecutors said. Data analysis showed she billed as if employees worked more than 20 hours a day, every day, for weeks.

Medicaid beneficiaries testified that they received little to no services and were told by Meadows’ employees that they had run out of available hours despite getting no help, the Justice Department said.

The HSS Program paid Meadows’ company more than $3.6 million between 2020 and 2025 into accounts she exclusively controlled, according to the department.

“The Fraud Division has arrived in Minnesota — and we are here to stay,” said Assistant Attorney General Colin M. McDonald. McDonald said Meadows’ scheme, and others like it, forced the program to shut down after its costs outran estimates by 4,000%.

“The defendant chose to defraud millions from a program meant to help vulnerable Minnesotans,” said U.S. Attorney Daniel N. Rosen for the District of Minnesota.

Meadows will be sentenced at a later date. She faces a maximum penalty of 10 years in prison on each count, but a federal judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

The FBI, the Department of Health and Human Services’ Office of Inspector General and IRS Criminal Investigation investigated the case. Trial attorneys Brant Cook and Emily Reeder-Ricchetti of the Fraud Division’s Health Care Fraud Section are prosecuting, with assistance from trial attorney Jody King and Assistant U.S. Attorney Matthew Murphy.

The Justice Department announced the creation of the Fraud Division on April 7. The department said its work supports President Donald Trump’s Task Force to Eliminate Fraud, chaired by Vice President J.D. Vance.

The department’s Health Care Fraud Strike Force Program, now made up of nine strike forces, has charged more than 6,200 defendants who collectively billed federal health care programs and private insurers more than $45 billion since 2007, according to the Justice Department.