How States Could Expand Medicaid HCBS Programs


Much of the home care industry and its workforce is focused on the Better Care Better Jobs Act, a recently introduced law that would inject billions of dollars into elderly care.

However, home care providers reimbursed by Medicaid have not forgotten the increase in the Federal Matching Rate – or “FMAP” – for Home and Community Services (HCBS) expenditures built into the American Rescue Plan Act. (ARPA).

Overall, ARPA has paved the way for states to receive more federal funds to expand the existing HCBS, provided they follow certain guidelines.

“Millions of people across the county – including people with disabilities and older Americans – depend on home care and the workforce that provides this critical care,” said Xavier Becerra, secretary of the US Department. of Health and Social Services (HHC). in a May announcement. “The Biden-Harris administration continues to support states and workers by making critical investments in home and community services.”

Going forward, there’s a good chance not all states will pursue the increased FMAP, as the federal bump would only be available for one year. Accepting federal aid to make big investments in the HCBS, some states say, would create a future financial cliff when that aid wears off.

Yet some states are currently developing plans to access the increased FMAP.

Exactly how they plan to use the funding is still a work in progress, but a new analysis from the Kaiser Family Foundation (KFF) offers several possible strategies highlighting how states have taken advantage of the Section 1115 demonstration waivers. .

Typically, these efforts fell under four buckets.

In some cases, states have used additional resources to streamline eligibility processes and the overall initiation of care, according to KFF. In others, states have expanded financial eligibility rules to help some enrollees afford to live in their home or community instead of a long-term care facility.

Rhode Island, for example, has used the flexibility of the waivers to allow HCBS benefits to new long-term care applicants for a deemed eligibility period while final financial eligibility determinations are pending. New York has used the waiver power to implement a special “income disregard” that takes rental costs into account when determining financial eligibility for HCBS.

“An evaluation of the New York waiver found positive impacts on those leaving institutional settings, including that a high percentage of enrollees remained in the community,” the KFF analysis reads.

In other cases, states have sought to strengthen the HCBS by opening services to additional populations.

Washington has taken such steps with its Tailored Support for Older Adults (TSOA) program, which creates a new eligibility path and a new benefit program for otherwise ineligible adults over the age of 55 who need a level of education. medical care. Elsewhere, Rhode Island’s 1115 waiver covers young adults between the ages of 19 and 21 who do not participate in HCBS programs for medically fragile children.

Finally, some states have also used additional resources to offer entirely new services through alternative service packages.

“While states can add services to existing benefit sets without the 1115 authorization, they can instead use 1115 waivers to design alternative benefit sets,” the analysis says. “For example, the [Medicaid Alternative Care] The Washington Waiver 1115 program provides an alternative benefit package to support unpaid caregivers for seniors who are otherwise eligible for Medicaid.

If passed, the Better Care Better Jobs Act would make states eligible for a permanent increase in their federal Medicaid match by 10 percentage points, building on the temporary bump built into ARPA.

Medicaid HCBS spending is estimated to be around $ 114 billion in fiscal 2021, before ARPA increases, according to KFF. Medicaid funds about 57% of HCBS in the United States, with private insurance covering 12% and 7% paid out of pocket.

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