Hawaii - Day Habilitation Services — Licensing, Medicaid Enrollment and Startup Requirements

Last reviewed: 2026-09-09

The Hawaii Department of Health (DOH) Developmental Disabilities Division (DDD) authorizes Day Habilitation services through the state's 1915(c) Home and Community Based Services (HCBS) Waiver for Individuals with Intellectual and Developmental Disabilities. Providers must first pass the DDD waiver provider certification process before submitting the DHS 1139 application and a $500 fee through the Med-QUEST Division's HOKU portal.

Approval requires demonstrating full compliance with the HCBS Settings Final Rule for non-residential community settings, proving the facility supports community integration and skill-building outcomes. Applicants must also clear fingerprint-based background checks, Adult Protective Services (APS), and Child Abuse and Neglect (CAN) screenings for all owners with a 5% or greater stake.

1. Service Definition and Scope

In Hawaii, Day Habilitation is defined under the DDD 1915(c) I/DD Waiver as structured daytime programming that builds self-help, socialization, and adaptive skills outside the participant's residence. The service focuses on enabling the participant to attain or maintain their maximum functional level.

Services must be delivered in a non-residential community setting that complies with the HCBS Final Rule on community integration. The programming must track specific skill-building outcomes documented in the participant's Individualized Service Plan (ISP).

• Target Population: Individuals with intellectual and developmental disabilities enrolled in the 1915(c) waiver.
• Setting Requirement: Must be delivered in a non-residential community setting.
• Integration Mandate: Settings must comply with the HCBS Final Rule for community integration.
• Core Activities: Building self-help, socialization, and adaptive skills.
• Service Exclusions: Cannot duplicate services provided under the Rehabilitation Act of 1973 or IDEA.

2. Regulatory and Oversight Agencies

The Hawaii Department of Health (DOH), Developmental Disabilities Division (DDD) is the primary operating agency for the 1915(c) I/DD Waiver and handles provider certification. The Department of Human Services (DHS), Med-QUEST Division (MQD) is the State Medicaid Agency responsible for final provider enrollment and validation.

Providers interact with the Med-QUEST HOKU system for enrollment and revalidation. DDD conducts ongoing monitoring and quality assurance for waiver providers.

• Operating Agency: Hawaii Department of Health, Developmental Disabilities Division (https://health.hawaii.gov/ddd).
• Medicaid Agency: Department of Human Services, Med-QUEST Division (https://medquest.hawaii.gov).
• Enrollment Portal: HOKU Provider Enrollment System (https://medquest.hawaii.gov/en/plans-providers/hoku.html).
• Background Check Authority: Hawaii Criminal Justice Data Center (HCJDC).

3. Gatekeeping Prerequisites: Who Can Even Apply

Hawaii does not utilize a Certificate of Need (CON) or closed RFP procurement process for Day Habilitation waiver providers. Enrollment is generally open to any entity that can meet the DDD certification standards and HCBS Final Rule requirements.

There are no mandatory subcontracting requirements under a designated network entity for this specific waiver service. However, applicants must have a physical commercial location secured that meets HCBS setting requirements before DDD will approve the certification.

• Certificate of Need: Not required for Day Habilitation in Hawaii.
• Procurement Model: Open enrollment; no closed RFP or moratorium currently in effect.
• Network Affiliation: Standalone enrollment is permitted; no mandatory lead agency affiliation.
• Facility Prerequisite: Must have a secured, non-residential commercial location prior to certification.
• HCBS Compliance: Must submit evidence of policies and operating practices complying with the HCBS Settings Final Rule.

4. Licensure and Certification Requirements

Hawaii does not issue a distinct facility license specifically named 'Day Habilitation Facility.' Instead, providers must obtain Adult Day Health or Adult Day Care licensure if applicable to their specific medical model, or operate under direct DDD Waiver Provider Certification for purely habilitative non-medical models.

The DDD certification process requires submitting a comprehensive policy and procedure manual, proof of commercial liability insurance, and an emergency preparedness plan. DDD conducts an initial site visit to verify the physical location meets safety and HCBS integration standards.

• Licensure Authority: DOH Office of Health Care Assurance (OHCA) for medical Adult Day Health models.
• Certification Authority: DOH Developmental Disabilities Division for waiver-specific approval.
• Required Documentation: Comprehensive policy and procedure manual aligned with DDD Waiver Standards.
• Insurance Requirement: Commercial general liability and professional liability insurance.
• Site Inspection: Initial on-site visit by DDD to verify physical safety and HCBS compliance.

5. Medicaid Provider Enrollment

After obtaining DDD certification, providers must enroll with the Hawaii Med-QUEST Division using the HOKU (Hawaii Online Kahu Utility) system. The process requires submitting the DHS 1139 Medicaid Provider Application.

HCBS providers are classified as institutional providers and are subject to a $500 application fee. Enrollment must be revalidated every five years.

• Enrollment System: HOKU Provider Enrollment System.
• Required Form: DHS 1139 Medicaid Provider Application.
• Application Fee: $500 fee required for institutional/HCBS providers.
• Risk Classification: HCBS providers are typically subject to moderate or high-risk screening.
• Revalidation Cycle: Providers must revalidate enrollment every five (5) years.

6. Staffing, Training and Background Checks

Direct Support Professionals (DSPs) providing Day Habilitation must meet minimum age and education requirements, typically being at least 18 years old with a high school diploma or equivalent. Agencies must designate a Service Supervisor to oversee the DSPs.

All owners with 5% or more interest, as well as all direct care staff, must undergo fingerprint-based criminal background checks. Staff must also clear Adult Protective Services (APS) and Child Abuse and Neglect (CAN) registry checks.

• Minimum Age: Direct care staff must be at least 18 years of age.
• Education Requirement: High school diploma or GED for Direct Support Professionals.
• Background Checks: Fingerprint-based criminal history check required for staff and 5% owners.
• Registry Screenings: Adult Protective Services (APS) and Child Abuse and Neglect (CAN) checks required.
• Training Mandate: Completion of DDD-approved DSP training curriculum, including CPR and First Aid.

7. Documentation, Policies and Records

Providers must maintain detailed daily service documentation that tracks specific skill-building outcomes as outlined in the participant's Individualized Service Plan (ISP). Records must be auditable and retained for a minimum of six years.

Agencies must implement policies covering incident reporting, grievance procedures, and HCBS Final Rule compliance. The Provider Participation Agreement mandates full disclosure of ownership and business transactions.

• Service Notes: Daily documentation tracking specific ISP skill-building outcomes.
• Record Retention: All Medicaid and service records must be kept for at least six (6) years.
• Incident Reporting: Mandatory policies for reporting adverse events to DDD within specified timeframes.
• Ownership Disclosure: Full disclosure of ownership and control per 42 CFR 455 Subpart B.
• HCBS Policies: Written operating practices demonstrating community integration and participant choice.

8. Billing, Rates and Claims

Day Habilitation services are billed to the Med-QUEST Division or the participant's managed care plan using specific HCPCS codes authorized in the 1915(c) waiver. Rates are established by the state and published in the DDD rate schedule.

Claims must be supported by daily attendance logs and progress notes. Billing for days the participant did not attend or for time spent in residential settings is strictly prohibited.

• Billing System: Claims are submitted via the Med-QUEST MMIS or applicable MCO portals.
• Procedure Codes: Specific HCPCS codes (e.g., T2020 or similar) as defined in the current DDD rate schedule.
• Rate Setting: Fixed fee-for-service rates established by DHS/DDD.
• Documentation Tie: Claims must perfectly match daily service documentation and attendance logs.
• Prohibited Billing: Cannot bill for transit time unless explicitly authorized as part of the service.

9. Approval Sequence and Timeline

The approval process begins with securing a compliant physical location and developing the required policy manuals. The provider then submits a certification application to the DOH Developmental Disabilities Division.

Following DDD site visits and certification approval, the provider submits the DHS 1139 application via HOKU. The entire process, from initial DDD application to active Med-QUEST enrollment, typically takes 4 to 8 months depending on application completeness and site visit scheduling.

• Step 1: Secure physical location and develop policy manuals.
• Step 2: Submit certification application to DOH DDD.
• Step 3: Complete DDD on-site inspection and HCBS compliance review.
• Step 4: Submit DHS 1139 application and $500 fee via HOKU.
• Estimated Timeline: 4 to 8 months from initial submission to active Medicaid billing status.

10. Common Denials and Survey Findings

Applications are frequently delayed or denied due to incomplete ownership disclosures or failure to pass the fingerprint-based background checks for key personnel. DDD will also halt certification if the proposed physical location resembles an institutional setting.

During ongoing surveys, common citations include missing daily progress notes, failure to track specific ISP goals, and lapsed CPR/First Aid certifications for direct care staff.

• Background Failures: Disqualifying criminal history or APS/CAN registry hits for owners or staff.
• HCBS Non-Compliance: Facility location or policies deemed too institutional or isolating.
• Incomplete Disclosures: Failure to fully detail 5% ownership stakes on the DHS 1139.
• Documentation Gaps: Missing daily service notes tying activities to ISP goals.
• Training Lapses: Expired CPR, First Aid, or mandatory DSP training certificates.

11. Key Contacts and Resources

Prospective providers should begin by reviewing the DDD Waiver Provider Standards Manual and the Med-QUEST provider enrollment guidelines. The HOKU portal is the central hub for all Medicaid enrollment actions.

For specific questions regarding waiver certification, providers should contact the DOH Developmental Disabilities Division directly. Med-QUEST handles all inquiries related to the DHS 1139 form and application fees.

• DOH Developmental Disabilities Division: https://health.hawaii.gov/ddd
• Med-QUEST Provider Enrollment: https://medquest.hawaii.gov/en/plans-providers/provider-enrollment.html
• HOKU Enrollment Portal: https://medquest.hawaii.gov/en/plans-providers/hoku.html
• Med-QUEST HCBS Inquiries Email: [email protected]
• Med-QUEST Provider Hotline: 808-692-8099

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