Running a Licensed Adult Family Home
Two things decide how a home does: its inspection record and how it is paid. Most homes are paid mainly by Medicaid, at a daily rate set by each resident's CARE classification and the home's region.
The rules keep changing, so the rule-change tracker is worth a look every few months.
Your steps, in order
- The Dos and Don'ts of Operating an AFHFourteen topics, each marked requirement or best practice.
- DSHS Inspections & ComplianceHow inspections work and the rules cited most often.
- A Through E: CARE ClassificationsHow each Medicaid resident's daily rate is set.
- CBHS Tiers ExplainedBehavioral health support paid on top of the base rate.
- The AFH Payment Field GuideECS, SBS, private pay, and what a contract list does not prove.
- Do AFHs Pay Taxes?The B&O exemption, sales tax, and the live-in Medicaid income exclusion.
- Getting Paid: ProviderOne BillingThe Medicaid contract, billing and pay dates, the resident's share, ECS and SBS.
- Washington AFH Rules Have ChangedEvery rule change since 2023, old beside new.
- Hiring a Management CompanyWhat a manager can do, what stays with you, and the DSHS filing.
- Find a ProfessionalBookkeepers, insurance brokers and others.
Watch out for
Inspections can come any time.
At least every 18 months, 15 on average, and unannounced; up to two years after three citation-free inspections.
The license fee is per bed.
$450 per licensed bed a year since July 2025 ($2,700 for six beds), per DSHS in writing.
Rules changed in 2025 and 2026.
Homes licensed after September 20, 2026 need 27-inch interior doors where residents pass through. Check advice against the rule-change tracker.
Looking for a figure or a rule? See Rules & key figures or the AFH glossary. General information, not legal or tax advice.
See the whole flow chart
Once licensed → Running a home
Once licensed → Running a home

