Hawaii - Assisted Living Facility — Licensing, Medicaid Enrollment and Startup Requirements

Last reviewed: 2026-09-09

The Hawaii Department of Health's Office of Health Care Assurance (OHCA) licenses Assisted Living Facilities under Hawaii Administrative Rules Title 11, Chapter 90, while the Department of Human Services Med-QUEST Division funds these services through the QUEST Integration Section 1115 Demonstration Waiver. Facilities must secure an active OHCA license before applying for Medicaid enrollment through the HOKU system.

Approval to bill Medicaid for assisted living services requires executing a provider contract with at least one of the QUEST Integration Managed Care Organizations (MCOs) operating in the state. Facilities submit the DHS 1139 form and undergo high-risk provider screening, including fingerprint-based background checks and a $500 application fee, to complete the Med-QUEST validation process.

1. Service Definition and Scope

Under HAR 11-90, an Assisted Living Facility in Hawaii is a building complex offering dwelling units and services to allow residents to maintain an independent assisted living lifestyle. The scope of care mandates 24-hour on-site direct care staff, provision of three meals daily, and assistance with activities of daily living.

The facility must coordinate health care requirements and provide access to nursing services for health monitoring. Services are delivered based on a comprehensive assessment and a written service plan that supports principles of dignity, privacy, and independence.

• Capacity: Licensed for multiple residents in a congregate setting, distinct from Type I or Type II Adult Residential Care Homes.
• Meals: Three meals daily, seven days a week, with modified diets and snacks evaluated and approved by a dietician on a semi-annual basis.
• Medication Management: Resident self-medication or facility administration, requiring review by an RN, pharmacist, or physician at least every 90 days.
• Nursing Services: Access to nursing services for health monitoring and coordination of care.
• Service Plan: Written description of services provided, frequency, provider, and expected outcomes based on a comprehensive assessment.

2. Regulatory and Oversight Agencies

Dual oversight governs Hawaii Assisted Living Facilities. The Department of Health (DOH) Office of Health Care Assurance (OHCA) handles physical plant inspections, life safety, and initial and renewal licensure.

The Department of Human Services (DHS) Med-QUEST Division (MQD) manages Medicaid provider enrollment and delegates daily waiver operations to the QUEST Integration MCOs.

• Licensing Agency: Hawaii Department of Health, Office of Health Care Assurance (https://health.hawaii.gov/ohca/)
• Medicaid Authority: Hawaii Department of Human Services, Med-QUEST Division (https://medquest.hawaii.gov/)
• Medicaid Enrollment Portal: HOKU Provider Enrollment System (https://medquest.hawaii.gov/en/plans-providers/hoku.html)
• Managed Care Plan Example: HMSA QUEST Integration (https://prc.hmsa.com/)

3. Gatekeeping Prerequisites: Who Can Even Apply

Hawaii does not utilize a Certificate of Need (CON) process for Assisted Living Facilities, but Medicaid participation is strictly gated by managed care contracting. Because Hawaii operates its Medicaid program entirely through the QUEST Integration 1115 Waiver, an ALF cannot bill Medicaid as a standalone fee-for-service provider.

Applicants must first obtain full licensure from DOH OHCA before Med-QUEST will process a Medicaid enrollment application. Following Med-QUEST enrollment, the facility must successfully negotiate and execute a network provider agreement with a QUEST Integration MCO to receive client referrals and reimbursement.

• Licensure Prerequisite: Active DOH OHCA Assisted Living Facility license required prior to Med-QUEST enrollment.
• Managed Care Contracting: Mandatory network affiliation with at least one QUEST Integration MCO.
• Zoning and Building Clearance: County Building Department review and approval required before DOH licensure application acceptance.
• Risk Category: Classified as high-risk or moderate-risk institutional providers, triggering mandatory site visits prior to Medicaid approval.

4. Licensure and Certification Requirements

Licensure applications are submitted to the DOH OHCA State Licensing Section in Kapolei. Facilities must comply with HAR 11-90 standards, which dictate structural requirements, emergency disaster planning, and administrative policies.

Licenses are valid for up to two years, and OHCA conducts unannounced inspections for relicensing. Separate buildings operated contiguously by the same management do not require separate licenses but do require distinct, department-approved staffing plans.

• Application Form: DOH OHCA licensure application requiring ownership disclosure for any person with a 10% or more interest.
• Financial Disclosure: Summary of all lease, management, and sales agreements relative to facility operation.
• Administrator Credentials: Name of the facility administrator and a list of three references.
• Inspection Frequency: OHCA conducts relicensing inspections no less than every two years.
• Licensure Fees: Assessed under HAR 11-103.1, determined by the director prior to issuance.

5. Medicaid Provider Enrollment

Once licensed, ALFs enroll in Hawaii Medicaid through the Med-QUEST Division's HOKU Provider Enrollment System. Institutional providers, including HCBS waiver providers, must complete the DHS 1139 form and undergo validation screening.

The Affordable Care Act mandates that Med-QUEST perform comprehensive screening. ALFs must revalidate their enrollment every five years and pay the required federal application fee during initial enrollment and revalidation.

• Enrollment System: HOKU Provider Enrollment System.
• Required Form: DHS 1139 (Medicaid Provider Application/Change Request Form).
• Application Fee: $500 fee collected from institutional and HCBS providers.
• Site Visit: MQD conducts on-site visits for high and moderate-risk providers to verify DHS 1139 accuracy.
• Revalidation: Required every five (5) years in accordance with 42 CFR §455.414.

6. Staffing, Training and Background Checks

HAR 11-90 requires ALFs to maintain sufficient staff to meet the 24-hour scheduled and unscheduled needs of residents. Distinct staffing plans must be approved by DOH OHCA, especially for multi-building contiguous campuses.

Med-QUEST imposes strict background check requirements for high-risk Medicaid providers. Owners and managing employees must clear comprehensive state and federal background screenings before Medicaid billing privileges are granted.

• Direct Care Staffing: 24-hour on-site direct care staff required.
• Clinical Oversight: RN, pharmacist, or physician required for 90-day medication reviews.
• Dietary Staff: Dietician required to evaluate and approve modified diets and snacks semi-annually.
• Criminal Background Checks: Fingerprint-based checks required for anyone with 5% or more ownership.
• Abuse Screenings: Mandatory Adult Protective Services (APS) and Child Abuse and Neglect (CAN) registry checks.

7. Documentation, Policies and Records

Facilities must maintain comprehensive resident records and administrative policies as outlined in HAR 11-90-9. This includes detailed service plans that reflect resident choices, independence, and specific care interventions.

Emergency preparedness documentation is heavily scrutinized. Facilities must maintain and biennially renew written transfer agreements with appropriate receiving facilities to accommodate all residents during a disaster evacuation.

• Comprehensive Assessment: Documented evaluation of resident needs to inform the service plan.
• Service Plan: Written document detailing what services are provided, by whom, frequency, and expected outcomes.
• Disaster Plan: Procedures for evacuating residents with impaired mobility or cognitive impairments.
• Transfer Agreement: Written agreement with receiving facilities, renewed every two years, for disaster evacuation.
• Medication Records: Documentation of all 90-day medication reviews by authorized clinical personnel.

8. Billing, Rates and Claims

Because Hawaii Medicaid operates under the QUEST Integration managed care model, ALFs do not bill the state Med-QUEST Division directly for services. Instead, claims are submitted to the specific MCO with which the resident is enrolled.

Room and board costs are not covered by Medicaid. Residents typically pay for room and board using their Supplemental Security Income (SSI) and the Hawaii Optional State Supplement (OSS), minus a Personal Needs Allowance (PNA).

• Reimbursement Model: Managed care capitation; providers bill the respective QUEST Integration MCO.
• Room and Board: Funded via resident's SSI and Hawaii Optional State Supplement (OSS), not Medicaid.
• Personal Needs Allowance: Deducted from the resident's income before calculating room and board payments.
• Claim Submission: Routed through the MCO's specific clearinghouse or provider portal.

9. Approval Sequence and Timeline

The approval sequence begins at the county level with zoning and building department clearances, followed by the DOH OHCA licensure application. OHCA reviews the application, financial disclosures, and staffing plans before conducting the initial licensing survey.

After obtaining the HAR 11-90 license, the facility submits the DHS 1139 application via the HOKU system, pays the $500 fee, and undergoes Med-QUEST fingerprinting and site visits. Finally, the provider applies for network inclusion with QUEST Integration MCOs.

• Step 1: County Building Department review and approval.
• Step 2: Submission of DOH OHCA licensure application and fees.
• Step 3: OHCA initial on-site inspection and license issuance.
• Step 4: Med-QUEST HOKU enrollment, DHS 1139 submission, and $500 fee payment.
• Step 5: MQD site visit and fingerprint-based background checks (APS/CAN).
• Step 6: Credentialing and contracting with QUEST Integration MCOs.

10. Common Denials and Survey Findings

DOH OHCA routinely cites facilities for deficiencies related to medication management and life safety code violations. Failure to ensure that an RN, pharmacist, or physician completes the mandatory 90-day medication review is a frequent survey finding.

On the Medicaid enrollment side, Med-QUEST applications are frequently delayed or denied due to incomplete ownership disclosures on the DHS 1139 form or failure of 5% owners to complete the fingerprint-based background checks within the required timeframe.

• Medication Review Lapses: Missing or late 90-day medication reviews by qualified clinical staff.
• Incomplete Disclosures: Failure to list all individuals with 10% or more ownership on the OHCA application or 5% on the DHS 1139.
• Disaster Plan Deficiencies: Expired biennial transfer agreements for emergency evacuations.
• Dietary Non-Compliance: Lack of semi-annual dietician approval for modified diets and snacks.
• Background Check Delays: Failure to clear APS and CAN screenings for managing employees.

11. Key Contacts and Resources

Providers should direct licensure inquiries to the DOH OHCA State Licensing Section in Kapolei. Medicaid enrollment questions are handled by the Med-QUEST Division's Health Care Services Branch.

Contracting inquiries must be directed to the individual QUEST Integration MCOs. Providers should monitor the Med-QUEST website for updates to the HOKU system and changes to the 1115 waiver.

• DOH OHCA State Licensing Section: https://health.hawaii.gov/ohca/state-licensing-section/
• Med-QUEST Division Provider Portal: https://medquest.hawaii.gov/
• HOKU Provider Enrollment System: https://medquest.hawaii.gov/en/plans-providers/hoku.html
• HMSA Provider Resource Center: https://prc.hmsa.com/
• HAR Title 11, Chapter 90 Rules: https://health.hawaii.gov/opppd/files/2015/06/11-901.pdf

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