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A federal jury in St. Paul on October 7 found Sharmaine Meadows, 45, of Lake Elmo, Minnesota, guilty on three federal counts of health care fraud for her role in a scheme that prosecutors say extracted more than $3.6 million from a state Medicaid housing program while the homeless residents it was meant to serve received little to no assistance.
A business built around billing, not services
Meadows owned Cradle of Love LLC, a St. Paul home health care company that enrolled as a provider in Minnesota’s Medicaid-funded Housing Stabilization Services (HSS) Program. The program reimbursed providers for transitional and sustaining housing services, allowing up to 150 hours for each phase per eligible beneficiary.
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At trial, prosecutors said Meadows ran the company primarily as a billing operation. They introduced a July 2022 staff meeting agenda, admitted as a trial exhibit, that listed “Maximizing of Hours” as a standing item. Evidence shown to the jury included repeated directions to staff to reach the 150-hour ceiling on every client account regardless of whether services were actually provided.
Paper services, remote workers, and statistical red flags
Prosecutors told jurors that Cradle of Love submitted claims for in-person housing assistance that could not have occurred as billed. Some alleged service hours were attributed to employees who were physically in Illinois or working from the Philippines at the time, and prosecutors said workers recruited overseas were paid roughly $6.00 per hour with no benefits while their reported hours were billed to Minnesota Medicaid at program rates as if services had been delivered in state.
Other claims were for beneficiaries who were hospitalized at the same times services were allegedly provided. A statistical review of the company’s billing logs presented at trial, labeled “Impossible Days” by prosecutors, showed records in which employees appeared to have worked more than 20 consecutive hours per day for extended periods.
Beneficiaries testified they received nothing
Former program beneficiaries who had been enrolled with Cradle of Love testified that they received little to no actual housing assistance. Multiple recipients said they were told their allocated hours had already been used when they sought help, a pattern that prosecutors argued reflected systematic theft of services billed under beneficiaries’ names.
Program collapse and a wider federal crackdown
State officials halted the Housing Stabilization Services Program after costs ballooned to about 4,000% of initial government estimates, a collapse federal authorities have attributed to widespread fraudulent billing by Meadow’s operation and other providers. The program is no longer in operation.
Meadows’ conviction comes amid a broader enforcement push in Minnesota: in May 2026 the Department of Justice charged 15 individuals across the state in connection with more than $90 million in alleged Medicaid losses spanning housing, medical, and autism services programs, according to federal authorities. Prosecutors alleged schemes that included billing for services to a person who had already died and using Medicaid disbursements to purchase real estate overseas.
Assistant Attorney General Colin M. McDonald of the Justice Department’s National Fraud Enforcement Division said of the case, “The Fraud Division has arrived in Minnesota — and we are here to stay.” U.S. Attorney Daniel N. Rosen for the District of Minnesota emphasized that prosecuting those who steal from taxpayers remains a central commitment of his office.
Next steps for sentencing and investigation
Meadows was convicted on three counts of health care fraud; each count carries a statutory maximum of 10 years in prison, giving her a potential exposure of up to 30 years. No sentencing date has been set. A federal district court judge will determine the final sentence using the U.S. Sentencing Guidelines, which consider the total loss amount, the defendant’s role in the offense, and whether a position of trust was exploited.
The case was investigated jointly by the FBI, the HHS Office of Inspector General, and IRS Criminal Investigation, and prosecuted by the DOJ’s Health Care Fraud Section together with the U.S. Attorney’s Office for the District of Minnesota. Since its creation in 2007, the DOJ has said its Health Care Fraud Strike Force Program has charged more than 6,200 defendants with combined alleged losses exceeding $45 billion.
