Many Medicaid Waiver providers are proud that they deliver compassionate and skilled services to their consumers. Yet, some people are not aware of the larger trends that are happening in the Medicaid Waiver program. Over the last few decades, there have been increases in spending and enrollment for Medicaid LTSS programs which has encouraged the growth of HCBS.

In order to provide some clarity about these much-needed programs, here is a little background information about Medicaid Waiver programs. However, the exact size of Medicaid HCBS programs varies from state to state.

A Brief Summary of 1115 & 1915(c) waivers:

As a reminder, Medicaid is a jointly-funded federal and state program. When combined with the Children’s Health Insurance Program (CHIP), Medicaid provides healthcare coverage for over 72.5 million U.S. citizens. This makes Medicaid the largest single source of health coverage in the United States which includes children, pregnant women, parents, seniors as well as individuals with disabilities.

Out of this comprehensive Medicaid program, there are individual programs commonly referred to as Medicaid Waivers.

These programs often are known by different names.

For example, there is the 1115 waivers, 1915(c) waivers, waiver services, waiver programs, Home and Community Based Services (HCBS) waivers, and other terms which are specific to individual states. Even though there are several different types of Medicaid Waivers, they are grouped under the regulations of sections 1115 and 1915(c) of the Social Security Act.

Section 1115 waivers allow for the research and demonstration of projects designed to test expanded eligibility options and methods for financing and delivering Medicaid services. Section 1915(c) waivers provide the legal funding for Home and Community-Based Services (HCBS). HCBS waivers allow individuals to receive long-term service & supports (LTSS) at home or in community settings outside of institutional settings.

Medicaid beneficiaries can receive services in their own home or community rather than institutions or other isolated settings. The programs are designed to provide care services to a variety of individuals, such as people with intellectual, developmental, physical disabilities or mental illnesses.

For human service agencies that provide homemaker/personal care (HPC) and other caregiver services, the section 1915(c) waiver provides the relevant funding for institutional care and home and community-based (HCBS) services. This waiver program allows states to provide home care services to individuals in their homes or communities.

Under the 1915(c) waiver program, the states are allowed to waive some of the federal Medicaid program requirements. In doing this, states can allocate funding that provides care for people who otherwise are not eligible for Medicaid benefits. In this way, state governments can target services for people who need long-term service & supports (LTSS).

Again, the Medicaid waiver program allow states to customize their Medicaid programs in order to meet the unique requirements of the communities in each state. In this way, individual states can experiment and develop new ways to deliver Medicaid-funded programs that may differ from the standard federal Medicaid program.

The Medicaid waiver program has been successful over the time. Over the last few decades, rates of abuse and neglect have decreased. At the same time, there has been a transition of people from institutions to a home and community based model.

Medicaid Home and Community-Based Services:

In 1995, the percentage of people receiving Medicaid-funded HCBS was 18 percent, while 82 percent of people received institutional-based services. However, by 2013 the rate of people receiving HCBS was 51 percent, while institutional-based services had decreased to 49 percent. The percentage of LTSS spending for HCBS has continued in recent years.

The shift in spending from institutional to HCBS reflects federal and state policies. These rebalancing efforts are driven by concerns about the high cost of institutional care. In addition, many of the individuals receiving these services would prefer to live in a community setting. These rebalancing efforts includes initiatives such as the Money Follows the Person demonstration program. This program provides grants to participating states in order to help individuals living in institutions to transition back to the community.

The population receiving long-term services and supports (LTSS), including home and community-based services (HCBS) will likely continue to increase in numbers. As an overall group, this population is aging while simultaneously benefiting from advances in medical support and technology.

For example, roughly 3.2 million people received HCBS through one of the three main Medicaid programs in 2014. This was a 5 percent population increase from the previous year. In 2016, Medicaid programs spent $94 billion on HCBS compared to $72 billion on institutional services. This was a 10 percent increase in HCBS spending from the year 2015. This increasing demand for HCBS is one of the reasons for a labor shortage in the field. Finding qualified direct support professionals, nurse practitioners and other direct care worker is a challenge for many waiver provider agencies and healthcare facilities.

As the number of individuals receiving HCBS continues to grow and become the predominant way of delivering LTSS to Medicaid beneficiaries, the policies controlling HCBS will also continue to evolve. The percentage of LTSS expenditures for HCBS continued to varies among people receiving supports and services. HCBS accounted for 78 percent of spending in programs primarily supporting people with developmental disabilities,

Current HCBS Policy Trends:

  • States are required to implement new requirements for Medicaid payment eligibility that HCBS settings must meet. These requirements are meant to ensure that beneficiaries receiving HCBS have adequate choices, their rights are protected and that there is community integration.
  • States are now required to implement electronic visit verification (EVV) for personal care services. The goal of the federal EVV mandate is to ensure that authorized personal care services are actually delivered. EVV technology can prevent disruptions in beneficiaries’ care, and protect the Medicaid program against fraud. States are required to implement an EVV solution by January 1, 2020, or risk having their Medicaid-based federal funding for personal care services reduced.
  • A number of approaches are in development in order to verify the quality of HCBS provide oversight of Medicaid-funded LTSS programs. These oversight efforts span both Medicaid fee-for-service and managed LTSS programs. The overall emphasis on the Medicaid beneficiary’s experiences and outcome.

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