Wisconsin adult family home license: the 3-4 bed DHS 88 license, step by step

Which Wisconsin license fits your bed count

Wisconsin divides small residential care by headcount, and the count decides who regulates you:

The statute defines a licensed adult family home as a place where 3 or 4 adults who are not related to the operator live and receive care, treatment or services above the level of room and board, which may include up to 7 hours of nursing care per resident per week.⁠³ A CBRF starts at 5 unrelated adults and is capped at 3 hours of nursing care per resident per week, so moving up in size actually lowers the nursing ceiling.⁠³ If you plan for five or more beds, you need the CBRF license instead; this guide does not cover it.

“Unrelated” has a fixed meaning. A relative under DHS 88 is a spouse, parent, step-parent, child, step-child, sibling, grandchild, grandparent, aunt, uncle, niece or nephew; anyone else counts as a resident if they live and sleep in the home and get care beyond room and board.⁠² If the home also holds a children’s foster home license under ch. DCF 56, the combined licensed capacity may not exceed 4.⁠² Respite stays are limited to 14 consecutive days at a time.⁠²

Running an unlicensed 3-4 bed home is a violation of § 50.033, punishable by a fine of up to $500, up to one year in county jail, or both, and the state or a licensing county can go to circuit court to shut it down.⁠⁴

The 1-2 bed alternative

A 1-2 bed home is certified, not licensed under DHS 88, to the Wisconsin Medicaid Standards for Certified 1-2 Bed Adult Family Homes (P-00638, updated August 2024).⁠⁶ Do not confuse this with Wis. Stat. § 50.032, which separately certifies a narrow class of homes: a private residence caring for 3 or 4 adults (more if all are siblings) who each have a developmental disability and whose home was licensed as a children’s home under § 48.62 at least 12 months before they turned 18.⁠⁵⁠³ You must be certified by exactly one MCO, county human service agency or IRIS before serving anyone; once certified, you may take residents funded by other MCOs, IRIS consultant agencies or counties.⁠⁶ IRIS providers apply through the AFH provider portal run by the Division of Medicaid Services.⁠⁶ Caregivers in 1-2 bed homes need at least 15 hours of training in their first 90 days and 15 hours every year, which is more ongoing training than DHS 88 requires of a 3-4 bed home.⁠⁶⁠²

Who licenses you: DQA, unless your county opts in

The statute lets a county department under Wis. Stat. § 46.215, 46.22, 46.23, 51.42 or 51.437 license adult family homes in its county; DHS licenses them in any county that elects not to.⁠⁴ DHS 88 defines the “licensing agency” the same way.⁠² DQA’s application page says DQA administers DHS 88 and sends every applicant to its online DHS DQA Provider Portal, and it names no county licensing office.⁠¹ The official sources do not say whether any county has elected to license 3-4 bed homes, so ask the Bureau of Assisted Living ([email protected], 608-266-8482) before applying whether your county licenses them itself.⁠¹

Within DQA, adult family home licensing runs through the Bureau of Assisted Living (BAL), and BAL’s regional directors decide resident waivers and ambulatory-status changes.⁠¹

Before you buy or lease: funding and the municipality

DQA states plainly that it does not refer residents and does not fund facilities. Publicly funded residents come through Family Care, Family Care Partnership and IRIS.⁠¹ DQA also posts this warning on its application page: managed care contracts for ambulatory-only adult family homes may not be offered in your municipality, so confirm with the funding source that there is a need in that city, town or village before you apply.⁠¹ Its page lists Community Care Inc. (866-992-6600), iCare (414-223-4847) and My Choice Wisconsin (877-489-3814), and directs you to the local aging and disability resource center to find which programs serve your area.⁠¹

DHS 88.04(2)(a) makes the licensee responsible for complying with all other laws governing the home, and DQA tells applicants to contact their municipality about local ordinances before applying.⁠¹⁠² The rule also requires the home to be in a residential area typical of that community, close enough to community activities and services that residents can walk or ride, or else you must get them there.⁠² You may not run any other business from the home that regularly brings customers in and affects residents’ privacy.⁠²

If you plan to bill Medicaid waiver programs, location matters a second way. The initial survey checklist flags “heightened scrutiny” for a home under the same roof as, on the grounds of, or immediately next to an institution providing inpatient care, such as a nursing home or intermediate care facility. Those homes go to the Division of Medicaid Services for a home and community-based services (HCBS) review with CMS.⁠⁸

Pick your ambulatory designation first

Your license states which residents you can serve by mobility, and you must name your designation in the program statement, the service agreement and the floor plan.⁠¹ DQA describes four settings:⁠¹

• Ambulatory. Residents walk independently. You may not admit or keep anyone who cannot walk or who uses a cane, crutches or walker, and you do not have to meet the ramp, door-width and turning-radius rules in DHS 88.05(2)(a)1-3. If a resident’s mobility drops temporarily, you can ask the BAL regional director for a waiver.
• Ambulatory with conditions. Residents may walk with difficulty or with a cane, crutches or walker, or need help on stairs, but no wheelchair users or non-walkers. You need ramped exits with a hard-surfaced path and handrails, grab bars, an assessment for levered handles, and first-floor bedroom, toilet, bathing and living space for anyone who cannot manage stairs alone.
• Non-ambulatory with conditions. A single- or multi-story home where only some bedrooms meet the non-ambulatory standard. Exit, common-use and non-ambulatory bedroom doors need a 32-inch clear opening, and bathrooms used by non-walking residents need wheelchair turning space. The program statement must say how many bedrooms are designated non-ambulatory. A resident who stops walking moves to a qualifying first-floor room, and if none is free, you may not keep them.
• Non-ambulatory. Single-story homes only, meeting DHS 88.05(2)(a)-(c) and the bedroom sizes below.

The program statement and admission agreement must warn residents that a change in mobility could lead to discharge if no suitable room, waiver or license change is available.⁠¹

The house: DHS 88.05 standards

The initial survey walks through these items using the Initial Survey Checklist, F-02634A (revised 07/2026).⁠⁸

Source: DHS 88.05.⁠² “Household members” includes you and your family, so a larger household can push you past the 8-person bathroom threshold.⁠²

Fire safety

DHS 88.05(4) sets the fire rules:⁠²

• A mounted fire extinguisher rated at least 2A, 10-B-C on every floor, including at the head of each stairway and in or near the kitchen (one unit can cover both if they are close together). Each needs an annual inspection by a dealer or the fire department, with a dated tag.
• Smoke detectors on every level, including at the head of each open stairway, at the door to each enclosed stairway, on the ceiling of the living or family room and each bedroom, and in the basement. Test them monthly.
• At least 2 exits from the first floor with clear access outside.
• A written evacuation plan with an outside meeting place. Review it with each new resident right after placement, and use the department’s form to check whether that resident can get out unaided within 2 minutes. Repeat that evaluation every year.
• Fire drills twice a year with the whole household, logging the date and evacuation time.
• Report any fire that needed the fire department to the licensing agency within 72 hours.
• If a resident cannot self-evacuate, you or a service provider must be in the home.

Licensee and staff qualifications

The licensee must be at least 21 and physically, emotionally and mentally capable of caring for the residents. Service providers, meaning paid staff or volunteers giving direct care, must be at least 18.⁠² DHS 88 sets no education or experience minimum for the licensee as of 2026-10-12. The pending rewrite would add one for new licensees (see the last section).⁠¹⁰

• Health screening. A physician, registered nurse or physician assistant must document that you and each service provider were screened for illness, including tuberculosis, within the 90 days before starting work.⁠²
• Training. You and each service provider complete 15 hours of training approved by the licensing agency, including fire safety and first aid, before or within 6 months of starting care. After that, 8 hours a year, starting the calendar year after the initial training. The agency can require more, or accept equivalent prior training, coursework or experience in similar licensed programs instead.⁠²
• Supervision. Someone must be present and awake at all times if any resident needs continuous care, and a service provider must be in the home whenever you are away overnight.⁠²
• Insurance. Homeowners or renters insurance for the whole license term. If you will drive residents, provide a certificate of liability coverage; staff who drive residents need vehicle insurance and a valid license.⁠²
• Finances. On request, show you can operate for at least 60 days. DHS notes that program contracts or agency agreements can satisfy this rule, and the new-provider checklist requires evidence up front.⁠²⁠⁷
• Money dealings. Neither you nor staff may sell property to residents, or buy from, borrow from or take money from them.⁠²

Background checks

DQA runs caregiver background checks under ch. DHS 12 before initial licensure and every four years after that.⁠¹ For a business, they cover the owner (or one principal officer for a corporation; for new applicants, the person who signs the application), officers or board members with regular, direct contact with residents, and nonclient residents of the home over age 10 who have regular, direct contact.⁠¹ Each person files a Background Information Disclosure form and its Appendix, and the checks must fall in the same calendar year as the application.⁠¹⁠⁷ You run caregiver checks on your own staff and keep them for DHS review.⁠¹ Anyone in the home who has worked as a nurse assistant, home health aide or hospice aide is also checked against the DHS caregiver registry.⁠²

Documents you upload

DQA’s New Provider Licensure Application Checklist, F-02108D, lists what a complete AFH application includes:⁠⁷

• Background checks completed by the Office of Caregiver Quality, as above.
• Assisted Living Facility Model Balance Sheet, F-62674A, or equivalent, with supporting documents.
• Evidence you can operate for 60 days.
• A floor plan no larger than 11 by 17 inches, with room measurements, exits and room uses.
• The program statement: the number and types of residents you will accept, whether the home is accessible to people with mobility problems, and a description of the home, location, services, who provides them and nearby community resources.⁠²
• The admission and service agreement covering every item in DHS 88.06(2)(c).
• Well water test results, if applicable, and furnace and chimney inspection results.
• If you lease, the lease plus the landlord’s statement that they know you will use the property for business. If you own with a mortgage, proof of ownership.
• If you are buying a licensed home, the current licensee’s letter of intent to sell.
• For a corporation, LLC or LLP, its organizing documents.
• To get Medicaid waiver funding, the HCBS Compliance Review Request, F-02138.⁠¹

Upload each document as a single file. A three-page program statement, for example, goes in as one combined file.⁠¹ DHS 88 categorizes the people you serve as “types of individuals,” such as older adults with functional impairments or people with irreversible dementia. To change the types you serve after licensure, give DQA and every resident’s guardian, representative, service coordinator, placing agency and payer 30 days’ written notice.⁠²

Application steps in order

1. Confirm funding demand

   Contact the MCOs or county serving your municipality before committing to a property.⁠¹

2. Check local ordinances

   Contact the city, town or village under DHS 88.04(2)(a).⁠¹

3. Set the ambulatory designation

   and match the house to it.⁠¹

4. Get a MyWisconsin ID

   and open an application in the DHS DQA Provider Portal.⁠¹

5. Upload the F-02108D package

   , along with the background check forms.⁠¹⁠⁷

6. Answer revision letters

   BAL sends no more than two. After a second unsuccessful revision, it will not accept an application from you for that location for one year. An application left incomplete for six months is closed.⁠¹

7. Sign the applicant compliance statement,

   which BAL requires before it schedules the initial survey.⁠¹

8. Pass the initial licensing survey

   An assisted living surveyor tours the home and reviews the F-02634A items, including records, fire safety, medications and, if requested, HCBS compliance.⁠¹⁠⁸ The rule also requires an interview with you.⁠²

9. Get the decision

   DHS has 70 days to approve or deny, counted from when it has a complete application and has finished the initial survey.⁠¹

Fee, biennial report and keeping the license

The licensing fee was $171 every two years as published on 2026-10-12, and application and continuation fees are non-refundable.⁠¹ DHS 88 also requires payment for the Department of Justice criminal records check when you apply.⁠² The rule says to send a check or money order large enough to cover the records-check fee, but the official pages reviewed do not state the amount, so ask BAL for the current amount before you submit.⁠²

The license does not expire; it is valid until revoked.⁠⁴ Every 24 months, on a DHS schedule, you file a biennial report online and pay the fee. If you miss the deadline, DHS issues a warning, and it can revoke the license if the report is still not filed within 60 days after the report date.⁠⁴

Between reports, DHS 88.03(5) sets these deadlines:⁠²

• 24 hours: a significant change in a resident’s condition, such as hospitalization after an accident, a missing resident, or a death linked to restraint or psychotropic medication, suicide or accident.
• 48 hours: a pending or actual criminal charge or conviction against you or a service provider that relates to caring for dependent people.
• 3 days: a death from an incident or accident not involving restraints, psychotropics or suicide.
• 7 days: household membership changes (other than paid staff), structural changes or damage that could endanger residents, and significant service changes that hurt residents.
• 30 days in advance: any revised program statement, for approval.

When a violation is cited, a plan of correction is due within 30 days, or sooner if residents are at risk. The agency can also limit the number or types of residents you serve, attach conditions to the license, summarily suspend it for imminent danger, or revoke it.⁠²

Running the home: admissions, care plans and medications

• Before admission: Give prospective residents the complaint process, the costs and payment methods, and each party’s role, including any housekeeping you will ask them to do, which they may refuse. Offer visits, including an overnight stay, and discuss the household’s religious and cultural beliefs.⁠²
• Service agreement: Sign it before admission, covering services, charges, any security deposit, payment terms and the conditions for discharge. Revise it at least 30 days before any change. Respite admissions are exempt.⁠²
• Health exam: A physician exam and communicable-disease screening within 90 days before or 7 days after admission. Respite stays of 7 days or fewer, once per calendar year, are exempt. After that, an annual physician exam.⁠²
• Assessment and individual service plan: Complete both within 30 days of placement, and review the plan at least every 6 months with the resident and their team.⁠²
• Nursing: You may arrange nursing care, or provide it yourself if qualified, up to 7 hours per resident per week.⁠² Above that, the resident needs a different setting, such as a home served by a Wisconsin home health agency or a nursing home.
• Medications: Keep prescriptions in their original pharmacy containers. Before you or staff give any medication, get the prescriber’s written order naming who may administer it. Keep a record of each dose with information on side effects. A resident may refuse medication unless a court has ordered it.⁠²
• Meals: Three meals a day plus snacks, served in the common dining area, with physician-ordered special diets.⁠²
• Rights: Residents must be free from seclusion and from physical and chemical restraints, with narrow emergency exceptions. Grievances follow ch. DHS 94, or the county procedure for county-placed residents.⁠²
• Discharge: 30 days’ written notice to the resident and their guardian, service coordinator, placing agency and representative, except in an emergency.⁠²
• Records: Keep resident records at least 7 years after discharge, and staff records for at least 3 years after employment ends.⁠²⁠⁸

The DHS 88 rewrite (CR 26-026)

DHS has called chapter DHS 88 essentially unchanged since it was created on June 1, 1995, and has a full revision in progress.⁠¹⁰ As of 2026-10-12, DHS’s rulemaking page showed: revised scope statement SS 066-24, approved May 30, 2024; Legislative Council Clearinghouse submittal as CR 26-026 on April 7, 2026; a public hearing on July 7, 2026; status “Preparing for submission to the Governor’s Office for review”; and a scope expiration of December 3, 2026.⁠⁹ The proposed rule is not in effect. As proposed, it would:⁠¹⁰

• Replace the ambulatory designations with Class A homes (residents who can respond to an alarm and get out unaided within 2 minutes), Class B homes (out within 4 minutes, with or without help) and Class C homes (non-ambulatory residents, or evacuation taking 4 minutes or more).
• Require a 1¾-inch solid-core or equivalent fire-rated door between the home and an attached garage, and add door-width and interconnected smoke detection requirements for Class B and C homes.
• Add an infection control program and raise education or experience requirements for new licensees, with existing licensees and staff grandfathered.
• Require a resident assessment before admission, a temporary service plan at admission and a full plan within 30 days, updated at least annually.
• Add dementia care and training standards, and require homes providing limited health services to employ or contract with a registered nurse, home health agency or hospice for delegation and oversight.

If you will apply in late 2026 or after, read the final rule order when it is published, because several of these requirements would apply only to homes licensed after the effective date.⁠¹⁰

Sources

1. 1
   Wisconsin Department of Health Services, Division of Quality Assurance, Adult Family Homes: Opening an Adult Family Home Checked 12 Oct 2026 · Back to text ↑
2. 2
   Wisconsin State Legislature, Wis. Admin. Code ch. DHS 88: Licensed Adult Family Homes Checked 12 Oct 2026 · Back to text ↑
3. 3
   Wisconsin State Legislature, Wis. Stat. § 50.01: Definitions Checked 12 Oct 2026 · Back to text ↑
4. 4
   Wisconsin State Legislature, Wis. Stat. § 50.033: Licensure of certain adult family homes Checked 12 Oct 2026 · Back to text ↑
5. 5
   Wisconsin State Legislature, Wis. Stat. § 50.032: Certification of certain adult family homes Checked 12 Oct 2026 · Back to text ↑
6. 6
   Wisconsin Department of Health Services, Medicaid Standards for Certified 1-2 Bed Adult Family Homes Checked 12 Oct 2026 · Back to text ↑
7. 7
   Wisconsin Department of Health Services, Division of Quality Assurance, Adult Family Home New Provider Licensure Application Checklist, F-02108D Checked 12 Oct 2026 · Back to text ↑
8. 8
   Wisconsin Department of Health Services, Division of Quality Assurance, Adult Family Home (AFH) Initial Survey Checklist, F-02634A (07/2026) Checked 12 Oct 2026 · Back to text ↑
9. 9
   Wisconsin Department of Health Services, Active Rulemaking Projects: DHS 88, Licensed Adult Family Homes Checked 12 Oct 2026 · Back to text ↑
10. 10
    Wisconsin State Legislature, Administrative Register, CR 26-026 proposed rule text (revision of ch. DHS 88) Checked 12 Oct 2026 · Back to text ↑
11. 11
    Wisconsin State Legislature, Wis. Admin. Code ch. DHS 83: Community-Based Residential Facilities Checked 12 Oct 2026 · Back to text ↑

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