Abrupt Rainbow Health closure sparks a scramble to fill gaps in care
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When Rik Kutcher was first diagnosed with HIV in the 1980s, he didn’t think he’d have a career working in prevention and advocacy.
“When I was diagnosed 38 years ago, we weren’t talking about living with HIV. We were talking about, how are we going to die?” Kutcher said.
Kutcher first came to the Minnesota AIDS Project — an organization that later grew into Rainbow Health — when he was homeless and struggling with addiction. The organization helped get him back on his feet, and, eventually, gave him a job. He worked as the aging services advocate at Rainbow Health in the Twin Cities.
In a last-minute meeting on July 18, he and the rest of the staff learned that Rainbow Health was shutting down that same day.
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In its closure announcement on social media, management said the organization had “insurmountable financial challenges.”
Former managers have not shared more details on the timing of the closure or the financial issues, leaving former staff and clients in limbo.
With first-hand knowledge of how important Rainbow’s services are, Kutcher said he’s especially stung by the closure’s impact on the organization’s thousands of clients.
“This was a place about more than just handing out some money, or a little bit of food support,” Kutcher said. “We understand what the needs are, we understand what the challenges are, and the things that we have had to overcome and live through.”
Transferring services
State and local agencies, former managers, and other local organizations are now hurrying to transfer the grant funds that Rainbow had left in the bank, and reconnect clients to vital services.
Officials at the Minnesota Department of Human Services say the agency had open grants and partnerships with Rainbow.
“They were a very key partner, and we had been working with them and had them as a grantee for many, many years before this really sudden and surprising closure,” said Natasha Merz, an assistant commissioner of aging and disability services at DHS.
Merz said the first priority was urgent services like medications and rental assistance. Much of that work and funding has been transferred to The Aliveness Project, another Twin Cities HIV services organization.
Director Matt Toburen says clients started reaching out to Aliveness right away because it serves some of the same clients as Rainbow.
“Our phones are blowing up,” Toburen said. “It’s just really scary.”
The Minneapolis City Council recently transferred nearly $2 million of federal funding from Rainbow to The Aliveness Project. It went toward rent payments and utility bills for 90 former Rainbow Health clients.
Toburen said Aliveness is working with government agencies to accept Rainbow’s clients. While they’ve taken on most of the urgent needs, Rainbow also provided services that Aliveness doesn’t, particularly its LGBTQ+ focused services and therapy.
“It’s gonna take a village,” Toburen said. “It’ll be ongoing, working with the community and organizations and government funders to kind of figure out the long term solution and plan.”
Ongoing outbreaks
The sudden closure came as HIV cases appear to be on the rise in Minnesota.
In 2020, the Minnesota Department of Health declared outbreaks in Hennepin and Ramsey Counties. In 2021, it added the Duluth area to that list. Officials said many of the new cases were linked to encampments and injection drug use.
Last year, the state reported the highest number of new HIV diagnoses in over a decade.
Jose Ramirez is an HIV program supervisor at the state health department.
“We’re still in the outbreak, which has made things a little difficult,” Ramirez said. “There is a high demand for a multitude of services, whether it's housing support, food support, and even just basic necessities.”
The need is driven by both the uptick in cases and in financial difficulties among people diagnosed earlier, Ramirez said.
Strained funding
While need has risen, funding has not.
Less money is coming in from federal drug rebates, which is critical for the state’s HIV programs. In 2023, the state Legislature allocated additional funding for two years to make up the gap. This is the second and final year of that funding.
The Department of Human Services is eyeing other ways to bring in money if drug rebates can’t sustain programming.
“We are actively working on what some potential solutions for that might look like to make sure that funding can stay stable, even as we are seeing some drop in that revenue,” Merz said.
Toburen says Aliveness is in a financially healthy place. But he keeps the funding question in mind as he plans for the future.
“We have the tools and the knowledge to end HIV in Minnesota. If we can get folks tested, know their status, get them into care, and on medications. In the right medical care, they can live long and healthy lives, which is amazing,” Toburen said. “Unfortunately, too many people continue to fall through the cracks. That’s what’s just so heartbreaking.”
Former staff demand answers
Rainbow’s 60 former staff members are wondering what happens to their clients — and their own paychecks.
Their contract mandated 30 days’ notice before letting employees go, which they did not receive. They were paid through the day of the organization’s closure, and their health care coverage has stopped.
Management met with Rainbow’s SEIU Healthcare Minnesota chapter union staff twice after the closure to discuss the workers’ concerns. But last week, workers said management canceled a session at the last minute.
Former case manager Uzoamaka McLoughlin said she still has lots of unanswered questions.
“We were not given an opportunity to even know the reason why this agency was shut down,” McLoughlin said. “We don’t know the reason why we lost our jobs.”
Former Rainbow Health board members said in a statement last week that the organization plans to file its dissolution notice with the Minnesota Attorney General's office in the coming weeks. Managers are currently working to resolve the organization’s outstanding debts.
“Our former employees and former clients remain top of mind during this transition,” the statement reads. “We ask for your patience as we move through this process and will share more information as we can.”