CMS proposes granting states more flexibility with Medicaid HCBS waivers

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The Centers for Medicare & Medicaid Services plans to propose a rule allowing states to combine waivers for three separate home and community-based services target populations. This continues the federal government's push to expand Medicaid funding to home- and community-based care.

Current rules dictate that states may use Section 1915(c) waivers to serve only one of the three target populations. These are the aged, disabled, or both; the mentally retarded or developmentally disabled, or both; and the mentally ill. Currently, the waivers create a system in which HCBS packages are determined by clinical diagnosis, rather than an individual's actual care needs. Combining the different populations under one Section 1915(c) waiver should allow states to provide need-based, rather than diagnosis-based, care, CMS said.

CMS would like comments on how removal of the regulatory barrier can increase a state's ability to design service packages based on need, rather than diagnosis or condition. CMS also is interested in comments on how this change may affect the state's ability to serve individuals requiring an institutional level of care. Increasingly, CMS is allowing states to use Medicaid funding for HCBS. It has traditionally been only allowed for institutional care, such as nursing homes.

The notice appears in the June 22 Federal Register. Comments will be posted online at