Residential Intellectual and Developmental Disability Facilities NAICS 623210

Jun 3, 2026 - Safety Concerns Prompt Minnesota Law Changes

• A new Minnesota law includes several changes to existing laws governing Minnesota’s group home industry. At least 50 Minnesota group home clients have died since late 2022 under circumstances serious enough to trigger a state maltreatment investigation. Many penalties amounted to fines of $5,000 or less, and most homes kept their licenses, according to APM Reports. The new law requires the Health Department to consider the density of group homes in a certain area when deciding whether to award a provider a license. The new law also requires the state to notify local governments about new group homes in their areas, which wasn’t required previously, and the state can now delegate safety inspections to cities if it chooses. A stricter regulation that would have prevented a new group home from opening within 650 feet of an existing one failed.
• Merger and acquisition (M&A) activity in the behavioral health sector increased 17% year over year in 2025, marking the industry’s second consecutive year of gains since 2023, according to Behavioral Health Business. Mental health and the intellectual and developmental disabilities (IDD) areas saw the most activity, with dealmaking in autism services following closely behind. Surges in utilization have made behavioral health one of the most sought-after sectors in health care services, according to mergers and acquisitions advisory firm the Braff Group. Dealmaking is still short of breaking the record set in 2021 but M&A activity has remained strong since then despite operators’ battles with macroeconomic headwinds like inflation, tariffs, expiration of expanded ACA subsidies, and changes in eligibility for Medicaid from the One Big Beautiful Bill Act.

• Private equity (PE) firms have become dominant players in the market for autism services since the mid-2010s, according to The Center for Economic and Policy Research (CEPR). Some residential intellectual disability facilities provide care for those with autism spectrum disorder. PE firms have bought out many provider organizations across the country and created national chains. The buyout of existing providers does not necessarily lead to the needed expansion of services or the opening of new sites, according to the CEPR. Autism services became a ‘hot market’ for PE acquisitions only after widespread health insurance coverage became available by the mid-2010s, according to the CEPR. This occurred through passage of state health insurance mandates, the Affordable Care Act mandate for coverage in its marketplace health plans, and the Medicaid mandate for coverage in 2014 of medically necessary services in behavioral health, including people with autism. Private equity firms completed 85% of all industry mergers and acquisitions in autism services between 2017 and 2022 – a rate not found in any other segment.
• Residential intellectual disability facilities increased prices 7.07%% year over year in March, according to the US Bureau of Labor Statistics (BLS). Residential intellectual disability facility industry employment decreased slightly and average wages for nonsupervisory employees increased slightly during the first two months of 2025, according to the BLS. Residential intellectual disability facility sales are forecast to grow at a 5.36% compounded annual rate from 2026 to 2030, faster than the growth of the overall economy, according to Inforum and the Interindustry Economic Research Fund, Inc.