CMS Issues New Guidance on State Implementation of Home and Community Based Services Regulation
Updates guided by extensive stakeholder process, focus on promoting beneficiary choice while maintaining commitment to community living
Today, the Centers for Medicare & Medicaid Services (CMS) issued updated guidance to State Medicaid Directors on implementation of the 2014 Home and Community Based Services (HCBS) regulation. The HCBS regulation impacts older adults and individuals with disabilities eligible for Medicaid HCBS (including intellectual, developmental and physical disabilities, as well as behavioral health conditions).
The 2014 regulation and related guidance sought to define the characteristics of settings that were community-based, in contrast to those that may have the qualities of an institution. The 2014 regulation also required states to develop a transition plan to ensure that all settings receiving certain Medicaid funding met federal HCBS standards. In response to concerns raised by states and other stakeholders about this process, CMS granted a three-year extension of that transition period in 2017, extending the date by which states must demonstrate compliance from March 2019 to March 2022.
Over the past 18 months, CMS convened a working group of states and sought feedback from provider and advocacy stakeholders regarding the implementation of the rule and concerns regarding its impact on beneficiaries and families. Through that process, CMS received support for the provisions of the original 2014 regulation that ensured that individuals had a right to be served in the most integrated setting appropriate. However, CMS received concerns that the implementing guidance was too prescriptive, fostered uncertainty, and may unnecessarily lead to beneficiaries losing access to preferred settings.
The updated guidance, issued as a set of frequently asked questions (FAQs), streamlines and clarifies the “heightened scrutiny” process, which allows states to provide evidence to CMS demonstrating that certain settings meet the federal HCBS criteria so that they can maintain access to Medicaid funding. The FAQs provide clarity on this process so that states have the flexibility they need to serve their residents while preserving an appropriate federal oversight role.
“Even well-intentioned policies from Washington often lack the flexibility needed to work for every state, community, setting, or family,” said CMS Administrator Seema Verma. “The implementing guidance issued under the prior administration was simply too prescriptive and unfairly singled out certain settings, causing unnecessary anxiety for many beneficiaries, families and providers. We believe our revised guidance strikes the appropriate balance to protect individual choice while maintaining the integrity of home and community-based funding.”
The updated guidance provides needed clarification on ways in which qualified providers can demonstrate compliance with regulatory criteria by the end of the transition period, facilitates beneficiary and family choice and advances the tenets of person-centered service delivery. Some examples of the changes incorporated into this updated guidance include:
- Streamlined and better defined criteria of settings that isolate HCBS beneficiaries and therefore must undergo “heightened scrutiny,” reducing uncertainty for states, providers, and families.
- New flexibilities that allow states to minimize additional review by CMS, including the ability for CMS to conduct sampling and for states to work with certain providers to come into compliance by 2020 and avoid a heightened scrutiny review.
- Removal of specific examples of settings that would be automatically identified as presumptively institutional due to isolation, including intentional communities. This allows these settings to be evaluated on their own individual characteristics.
- Streamlined requirements for what states must submit for public comment and to CMS on presumptively institutional settings.
- More limited federal oversight role for private homes by clarifying that private residences where individuals received Medicaid funded services are assumed to comply with the regulatory criteria; and that settings in which Medicaid HCBS are not received do not need to comply with the criteria of a home and community-based setting at all.
In addition to the FAQs, CMS also continues to provide technical assistance to states and other stakeholders. CMS remains committed to partner with states in the administration of the Medicaid program.
To view the FAQs, visit Medicaid.gov at https://www.medicaid.gov/federal-policy-guidance/downloads/smd19001.pdf