Medicaid Program; State Plan Home and Community-Based Services, 5-Year Period for Waivers, Provider Payment Reassignment, and Home and Community-Based Setting Requirements for Community First Choice and Home and Community-Based Services (HCBS) Waivers, 2947-3039 [2014-00487]
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Vol. 79
Thursday,
No. 11
January 16, 2014
Part II
Department of Health and Human Services
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Centers for Medicare and Medicaid Services
42 CFR Part 430, 431 et al.
Medicaid Program; State Plan Home and Community-Based Services,
5-Year Period for Waivers, Provider Payment Reassignment, and Home
and Community-Based Setting Requirements for Community First Choice
and Home and Community-Based Services (HCBS) Waivers; Final Rule
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Federal Register / Vol. 79, No. 11 / Thursday, January 16, 2014 / Rules and Regulations
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
Centers for Medicare & Medicaid
Services
42 CFR Parts 430, 431, 435, 436, 440,
441 and 447
[CMS–2249–F; CMS–2296–F]
RIN 0938–AO53; 0938–AP61
Medicaid Program; State Plan Home
and Community-Based Services, 5Year Period for Waivers, Provider
Payment Reassignment, and Home
and Community-Based Setting
Requirements for Community First
Choice and Home and CommunityBased Services (HCBS) Waivers
Centers for Medicare &
Medicaid Services (CMS), HHS.
ACTION: Final rule.
AGENCY:
This final rule amends the
Medicaid regulations to define and
describe state plan section 1915(i) home
and community-based services (HCBS)
under the Social Security Act (the Act)
amended by the Affordable Care Act.
This rule offers states new flexibilities
in providing necessary and appropriate
services to elderly and disabled
populations. This rule describes
Medicaid coverage of the optional state
plan benefit to furnish home and
community based-services and draw
federal matching funds.
This rule also provides for a 5-year
duration for certain demonstration
projects or waivers at the discretion of
the Secretary, when they provide
medical assistance for individuals
dually eligible for Medicaid and
Medicare benefits, includes payment
reassignment provisions because state
Medicaid programs often operate as the
primary or only payer for the class of
practitioners that includes HCBS
providers, and amends Medicaid
regulations to provide home and
community-based setting requirements
related to the Affordable Care Act for
Community First Choice State plan
option. This final rule also makes
several important changes to the
regulations implementing Medicaid
1915(c) HCBS waivers.
DATES: Effective Date: These regulations
are effective on March 17, 2014.
FOR FURTHER INFORMATION CONTACT:
Kathy Poisal, (410)786–5940.
SUPPLEMENTARY INFORMATION:
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SUMMARY:
Table of Contents
I. Executive Summary
II. State Plan Home and Community-Based
Services, 5-Year Period for Waivers,
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Provider Payment Reassignment, and
Home and Community-Based Setting
Requirements for Community First
Choice
A. Background
B. Provisions of the Proposed Regulations
and Analysis of and Responses to Public
Comments
1. 5-Year Period for Certain Demonstration
Projects and Waivers (part 430)
2. State Organization and General
Administration (part 431)
3. Eligibility in the States, District of
Columbia, the Northern Mariana Islands,
and American Samoa (part 435) and
Eligibility in Guam, Puerto Rico and the
Virgin Islands (part 436)
4. Services: General Provisions (part 440)
5. State Plan Home and Community-based
Services under section 1915(i)(1) of the
Act (§ 441.710) and Community First
Choice State Plan Option: Home and
Community-Based Setting Requirements
(§ 441.530)
6. Needs-based Criteria and Evaluation
(§ 441.715)
7. Independent assessment (§ 441.720)
8. Person-Centered Service plan (§ 441.725)
9. Provider qualifications (§ 441.730)
10. Definition of Individual’s
Representative (§ 441.735)
11. Self-directed Services (§ 441.740)
12. State Plan HCBS Administration: State
Responsibilities and Quality
Improvement (§ 441.745)
13. Prohibition Against Reassignment of
Provider Claims (§ 447.10)
III. Home and Community-Based Services
(HCBS) Waivers (Section 1915(c) of the
Act)
A. Background
B. Provisions of the Proposed Regulations
and Analysis of and Responses to Public
Comments
1. Contents of request for a waiver
(§ 441.301)
2. State Assurances (§ 441.302)
3. Duration, extension, and amendment of
a waiver (§ 441.304)
IV. Provisions of the Final Regulations
V. Collection of Information Requirements
VI. Regulatory Impact Analysis
VII. Regulatory Flexibility Act Analysis
VIII. Unfunded Mandates Reform Act
Analysis
IX. Federalism Analysis
Regulation Text
Acronyms
Because of the many terms to which we
refer by acronym in this final rule, we are
listing the acronyms used and their
corresponding terms in alphabetical order
below.
ADA Americans with Disabilities Act of
1990 (Pub. L. 110–325)
ADLs Activities of daily living
AHRQ Agency for Healthcare Research and
Quality
ANPRM Advance Notice of Proposed
Rulemaking
CFC Community First Choice (1915(k) State
plan Option)
CHIPRA Children’s Health Insurance
Program Reauthorization of 2009 (Pub. L.
111–3)
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CMS Centers for Medicare & Medicaid
Services
DRA Deficit Reduction Act of 2005 (Pub. L.
109–171)
EPSDT Early and Periodic Screening,
Diagnosis and Treatment
FBR Federal benefit rate
FFP Federal financial participation
FPL Federal poverty line
FY Federal fiscal year
HCB Home and community based
HCBS Home and Community-Based
Services
HHS Department of Health and Human
Services
IADLs Instrumental activities of daily living
ICF/IID Intermediate care facility for
individuals with intellectual disabilities
LOC Level of care
NF Nursing facility
OBRA‘81 Omnibus Budget Reconciliation
Act of 1981 (Pub. L. 97–35)
OT Occupational therapy
PT Physical therapy
RFA Regulatory Flexibility Act
SPA State Plan Amendments
SSI Supplemental Security Income
SSI/FBR Supplemental Security Income
Federal Benefit Rate
UPL Upper payment limit
I. Executive Summary
A. Purpose
This final rule amends Medicaid
regulations consistent with the
requirements of section 2601 of the
Patient Protection and Affordable Care
Act of 2010 (Affordable Care Act),
which added section 1915(h)(2) to the
Act to provide authority for a 5-year
duration for certain demonstration
projects or waivers under sections 1115,
1915(b), (c), or (d) of the Act, at the
discretion of the Secretary, when they
provide medical assistance to
individuals who are dually eligible for
both Medicaid and Medicare benefits.
This final rule also provides
additional limited exception to the
general requirement that payment for
services under a state plan must be
made directly to the individual
practitioner providing a service when
the Medicaid program is the primary
source of reimbursement for a class of
individual practitioners. This exception
will allow payments to be made to other
parties to benefit the providers by
ensuring workforce stability, health and
welfare, and trainings, and provide
added flexibility to the state. We are
including the payment reassignment
provision, because states’ Medicaid
programs often operate as the primary or
only payer for the class of practitioners
that includes HCBS providers.
In addition, this final rule also
amends Medicaid regulations to provide
home and community-based setting
requirements related to section 2401 of
the Affordable Care Act for section
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1915(k) of the Act, the Community First
Choice State plan option.
This final rule further amends the
Medicaid regulations to define and
describe state plan home and
community-based services (HCBS). This
regulation outlines the optional state
plan benefit to furnish home and
community-based state plan services
and draw federal matching funds. As a
result, states will be able to design and
tailor Medicaid services to better
accommodate individual needs. This
may result in improved patient
outcomes and satisfaction, while
enabling states to effectively manage
their Medicaid resources.
This final rule also revises the
regulations implementing Medicaid
home and community-based services
(HCBS) waivers under section 1915(c) of
the Social Security Act (the Act) by
providing states the option to combine
the existing three waiver targeting
groups identified in § 441.301. In
addition, this final rule will include
other changes to the HCBS waiver
provisions to convey expectations
regarding person-centered plans of care,
to provide characteristics of settings that
are home and community-based as well
as settings that may not be home and
community-based, to clarify the timing
of amendments and public input
requirements when states propose
modifications to HCBS waiver programs
and service rates, and to describe the
additional strategies available to CMS to
ensure state compliance with the
statutory provisions of section 1915(c)
of the Act. The final rule also includes
requirements for person-centered plans
of care that document, among other
things, an individual’s choice of a HCB
setting from among options that meet
the individual’s needs.
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B. Summary of the Major Provisions
1. State Plan Home Community-Based
Services (Section 1915(i) of the Act)
The Deficit Reduction Act (DRA)
added a new provision to the Medicaid
statute entitled ‘‘Expanded Access to
Home and Community-Based Services
for the Elderly and Disabled.’’ This
provision allows states to provide HCBS
(as an optional program) under their
state Medicaid plans. This option allows
states to receive federal financial
participation for services that were
previously eligible for federal funds
only under waiver or demonstration
projects. This provision was further
amended by the Affordable Care Act.
The statute now provides additional
options for states to design and
implement HCBS under the Medicaid
state plan. In the April 4, 2008, Federal
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Register, (73 FR 18676) we published a
proposed rule to amend Medicaid
regulations to implement HCBS under
the DRA. That proposed rule was not
finalized, and with the passage of
section 2402 of the Affordable Care Act,
some previously proposed regulations
would no longer be in compliance with
the current law under section 1915(i) of
the Act. In addition, several new
provisions were added. Specifically, the
Affordable Care Act amended the statute
by adding a new optional categorical
eligibility group for individuals to
provide full Medicaid benefits to certain
individuals who will be receiving
HCBS. It also authorized states to elect
not to comply with section
1902(a)(10)(B) of the Act pertaining to
comparability of Medicaid services.
After closely analyzing the Affordable
Care Act provisions, we concluded that
a new proposed rule was necessary.
This final rule also establishes home
and community-based setting
requirements. We will allow states a
transition/phase-in period for current
approved 1915(i) State plan HCBS to
demonstrate compliance with these
requirements.
2. 5-Year Period for Certain
Demonstration Projects and Waivers
This final rule provides for a 5-year
approval or renewal period, subject to
the discretion of the Secretary, for
certain Medicaid waivers. Specifically,
this time period applies for
demonstration and waiver programs
through which a state serves individuals
who are dually eligible for both
Medicare and Medicaid benefits.
3. Provider Payment Reassignments
Section 1902(a)(32) of the Act
provides that state plans can allow
payments to be made only to certain
individuals or entities. Specifically,
payment may only be made to an
individual practitioner who provided
the service. The statute provides several
specific exceptions to the general
principle of direct payment to the
individual practitioner.
Over the years, some states have
requested that we consider adopting
additional exceptions to the direct
payment principle to permit
withholding from the payment due to
the individual practitioner for amounts
paid by the state directly to third parties
for health and welfare benefits, training
costs and other benefits customary for
employees. These amounts would not
be retained by the state, but would be
remitted to third parties on behalf of the
practitioner for the stated purpose.
While the statute does not expressly
provide for additional exceptions to the
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direct payment principle, we believe the
circumstances at issue were not
contemplated under the statute.
Therefore, we proposed that the direct
payment principle should not apply
because we think its application would
contravene the fundamental purpose of
this provision. The apparent purpose of
the direct payment principle was to
prohibit factoring arrangements, and not
to preclude a Medicaid program that is
functioning as the practitioner’s primary
source of revenue from fulfilling the
basic responsibilities that are associated
with that role. Therefore, we proposed
an additional exception to describe
payments that we do not see as within
the intended scope of the statutory
direct payment requirement, that would
allow the state to claim as a provider
payment amounts that are not directly
paid to the provider, but are withheld
and remitted to a third party on behalf
of the provider for health and welfare
benefit contributions, training costs, and
other benefits customary for employees.
4. Community First Choice State Plan
Option: Home and Community-Based
Setting Requirements (Section 1915(k)
of the Act)
Section 1915(k)(1)(A)(ii) of the Act
provides that home and communitybased attendant services and supports
must be provided in a home and
community-based setting. The statute
specifies that home and communitybased settings do not include a nursing
facility, institution for mental diseases,
or an intermediate care facility for
individuals with intellectual
disabilities. We have adopted this
statutory language in our regulations.
Additionally, to provide greater clarity,
we have established that home and
community-based settings must exhibit
specific qualities to be eligible sites for
delivery of home and community-based
services.
After consideration of comments
received in response to the Community
First Choice (CFC) proposed rule
published in the Federal Register (76
FR 10736) on February 25, 2011, we
decided to revise the setting provision
and publish our proposed definition as
a new proposed rule to allow for
additional public comment before this
final rule. The public comment process
has been valuable in assisting us to
develop the best policy on this issue for
Medicaid beneficiaries. We have fully
considered all comments received, and
have aligned the requirements
pertaining to home and communitybased settings across CFC, section
1915(i) State plan HCBS, and section
1915(c) of the Act HCBS waivers.
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5. Home and Community Based Services
Waivers (Section 1915(c) of the Act)
Section 1915(c) of the Act authorizes
the Secretary of Health and Human
Services to waive certain Medicaid
statutory requirements so that a state
may offer Home and Community-Based
Services (HCBS) to state-specified
group(s) of Medicaid beneficiaries who
otherwise would require services at an
Provision description
institutional level of care. This final rule
will give states the option to combine
the existing three waiver targeting
groups as identified in § 441.301. In
addition, it will implement
requirements regarding person-centered
service plans, clarify the timing of
amendments when states modify HCBS
waiver programs and service rates, and
describe the additional strategies
available to us to ensure state
compliance with the provisions of
section 1915(c) of the Act. This final
rule also establishes home and
community-based setting requirements.
We will allow states a transition/phasein period for current approved 1915(c)
HCBS waivers to demonstrate
compliance with these requirements.
C. Summary of Costs, Benefits and
Transfers
Total costs
Total benefits
Total transfers
1915(i) State Plan
Home CommunityBased Services.
The estimated total
annual collection of
information requirements cost to states
is $21,805..
We anticipate that states will make varying
use of the state plan HCBS benefit provisions to provide needed long-term care
services for Medicaid beneficiaries. These
services will be provided in the home or alternative living arrangements in the community, which is of benefit to the beneficiary, and is less costly than institutional
care..
Section 2601 of the Affordable Care Act: 5Year Period for Demonstration Projects
(Waivers).
N/A .............................
Provider Payment Reassignments.
N/A .............................
Section 2401 of the Affordable Care Act:
Community First
Choice State Plan
Option: Home and
Community-Based
Setting Requirements.
1915(c) Home and
Community-Based
Services Waivers.
N/A .............................
As this provision elongates the time period
under which states may operate certain
waiver programs without renewal, it will
help states to minimize administrative and
renewal requirements in order to better
focus on program implementation and quality oversight..
This rule implements additional operational
flexibilities for states to help ensure a
strong provider workforce..
This rule provides states with necessary guidance to support compliance with the requirement that CFC services are provided
in a home or community based-setting.
This rule also provides beneficiary protections to support an individual’s choice to receive HCBS in a manner that allows for integration with the greater community..
These changes will support beneficiaries by
enabling services to be planned and delivered in a manner driven by the beneficiary
and will maximize opportunities for beneficiaries to have access to the benefits of
community living and receive services in
the most integrated setting. These changes
will also enable states to realize administrative and program design simplification
and improve efficiency of operation..
We estimate that, adjusted for a phase-in period during which states gradually elect to
offer the state plan HCBS benefit, in FY
2014 the federal cost would be $150 million, and the estimated state cost would be
$115million. (Some portion of these impacts would actually be societal costs rather than ‘‘transfers’’, to the extent that new
users of the HCBS in this rule are previously not receiving services.)
No impact on federal or state Medicaid funding. This rule is voluntary on the part of
states.
States may incur costs
in coming into compliance with this
rule. Given the variability in state programs, and the
varying extent to
which some are already complying, it
is difficult to estimate these costs..
II. State Plan Home and CommunityBased Services, 5-Year Period for
Waivers, Provider Payment
Reassignment, and Home and
Community-Based Setting
Requirements for Community First
Choice
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A. Background
On February 8, 2006, the Deficit
Reduction Act (DRA) of 2005 (Pub. L.
109–171) was signed into law. Section
6086 of the DRA is entitled ‘‘Expanded
Access to Home and Community-Based
Services for the Elderly and Disabled.’’
Section 6086(a) of the DRA adds a new
section 1915(i) to the Act that allows
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states, at their option, to provide home
and community-based services (HCBS)
under their regular state Medicaid
plans. This option allows states to
receive federal financial participation
(FFP) for services that were previously
eligible for the funds only under waiver
or demonstration projects, including
those under sections 1915(c) and 1115
of the Act. Section 1915(i) of the Act
was later amended by sections 2402(b)
through (g) of the Patient Protection and
Affordable Care Act of 2010 (Pub. L.
111–148, enacted March 23, 2010)
(Affordable Care Act) to provide
additional options for states to design
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We do not anticipate any impact on federal
Medicaid funding. This rule is voluntary on
the part of states.
We do not anticipate there is an impact on
federal or state Medicaid funding, as the
purpose of the rule is merely to define
home and community-based settings in
which CFC services may be provided.
We do not anticipate any impact on federal
Medicaid funding.
and implement HCBS under the
Medicaid state plan.
In the following discussion of this
regulation, we refer to particular home
and community-based service(s) offered
under section 1915(i) of the Act as
‘‘State plan HCBS’’ or simply ‘‘HCBS’’ 1.
We refer to the ‘‘State plan HCBS
benefit’’ when describing the collective
requirements of section 1915(i) of the
Act that apply to states electing to
provide one, or several, of the
authorized HCBS. We choose to use the
1 Note that the abbreviation HCBS does not
distinguish between singular and plural. Where this
could be confusing, we spell out home and
community-based service(s).
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term ‘‘benefit’’ rather than ‘‘program’’ to
describe section 1915(i) of the Act to
avoid possible confusion with section
1915(c) HCBS waiver programs. The
State plan HCBS benefit shares many
features with section 1915(c) waiver
programs, but it is a state plan benefit,
although one with very unique features
not common to traditional state plan
services.
Under section 1915(i) of the Act,
states can provide HCBS to individuals
who require less than institutional level
of care (LOC) and who would, therefore,
not be eligible for HCBS under section
1915(c) waivers, in addition to serving
individuals who have needs that would
meet entry requirements for an
institution. As with other state plan
services, the benefits must be provided
statewide, and states must not limit the
number of eligible people served.
Section 1915(i) of the Act explicitly
provides that State plan HCBS may be
provided without determining that, but
for the provision of these services,
individuals would require the LOC
provided in a hospital, a nursing facility
(NF), or an intermediate care facility for
individuals with intellectual
disabilities 2 (ICF/IID) as is required in
section 1915(c) HCBS waivers. While
HCBS provided through section 1915(c)
waivers must be ‘‘cost-neutral’’, as
compared to institutional services, no
cost neutrality requirement applies to
the section 1915(i) State plan HCBS
benefit. States are not required to
produce comparative cost estimates of
institutional care and the State plan
HCBS benefit. This significant
distinction allows states to offer HCBS
to individuals whose needs are
substantial, but not severe enough to
qualify them for institutional or waiver
services, and to individuals for whom
there is not an offset for cost savings in
NFs, ICFs/MR, or hospitals.
To be eligible for the State plan HCBS
benefit, an individual must be included
in an eligibility group that is contained
in the state plan, including if the state
elects, the new eligibility group defined
at section 1902(a)(10)(A)(ii)(XXII) of the
Act. Each individual must meet all
financial and non-financial criteria set
forth in the plan for the applicable
eligibility group.
HCBS benefits that are not otherwise
available through section 1905(a) of the
Act state plan services under the
2 While the Social Security Act still refers to these
types of facilities as intermediate care facilities for
the mentally retarded (ICFs/MR), the language used
in this rule reflects ‘‘intellectual disability’’ as the
appropriate way to discuss this type of disability,
based on Rosa’s Law and we now refer to this types
of facility as an intermediate care facility for
individuals with intellectual disabilities (ICF/IID).
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Medicaid Early and Periodic Screening,
Diagnostic, and Treatment (EPSDT)
benefit may be furnished to Medicaid
eligible children who meet the State
plan HCBS needs-based eligibility
criteria, and who meet the state’s
medical necessity criteria for the receipt
of services. In addition to meeting
EPSDT requirements through the
provision of 1905(a) services, a state
may also meet, in part, a particular
child’s needs under EPSDT through
services that are also available through
the 1915(i) benefit. However, all
Medicaid-eligible children must have
full access to services required under
EPSDT, and the provision of 1915(i)
State plan HCBS should in no way
hinder their access to such services.
Section 1915(i)(1)(H)(i) of the Act
requires the state to ensure that the State
plan HCBS benefit meets federal and
state guidelines for quality assurance,
which we interpret as assurances of
quality improvement. Consistent with
current trends in health care, the
language of quality assurance has
evolved to mean quality improvement, a
systems approach designed to
continuously improve services and
support and prevent or minimize
problems prior to occurrences.
Guidelines for quality improvement
have been made available through CMS
policies governing section 1915(c) HCBS
waivers available at
www.hcbswaivers.net and published
manuscripts available at
www.nationalqualityenterprise.com.
Section 1915(i) provides states the
option to provide home and
community-based services, but does not
define ‘‘home and community-based.’’
Along with our overarching goal to
improve Medicaid HCBS, we seek to
ensure that Medicaid is supporting
needed strategies for states in their
efforts to meet their obligations under
the ADA and the Supreme Court
decision in Olmstead v. L.C., 527 U.S.
581 (1999). In the Olmstead decision,
the Court affirmed a state’s obligations
to provide covered program services to
eligible individuals with disabilities in
the most integrated setting appropriate
to their needs. A state’s obligations
under the ADA and section 504 of the
Rehabilitation Act are not defined by, or
limited to, the services provided under
the State’s Medicaid program. However,
the Medicaid program can support
compliance with the ADA, section 504
of the Rehabilitation Act, and Olmstead
through the provision of Medicaid
services to Medicaid-eligible
individuals in integrated settings.
We noted in the May 3, 2012
proposed rule published in the Federal
Register (77 FR 26362), that home and
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community-based settings do not
include nursing facilities, institutions
for mental diseases, intermediate care
facilities for the mentally retarded,
hospitals, or any other locations that
have the qualities of an institutional
setting as determined by the Secretary.
While HCBS are not available while
an individual resides in an institution,
HCBS may be available to assist
individuals to transition from an
institution to the community.
Recognizing that individuals leaving
institutions require assistance to
establish themselves in the community,
we would allow states to include in a
section 1915(i) benefit, as an ‘‘other’’
service, certain transition services to be
offered to individuals to assist them in
their transition to the community. We
proposed that community transition
services could be commenced prior to
discharge and could be used to assist
individuals during the period of
transition from an institutional
residence. Additionally, services could
be provided to assist individuals
transitioning to independent living in
the community, as described in a letter
to the State Medicaid Directors on May
9, 2002 (SMDL #02–008). We further
recognize that, for short hospital stays,
an individual may benefit from ongoing
support through the State plan HCBS
benefit to meet needs not met through
the provision of hospital services that
are identified in the individual’s personcentered service plan, to ensure smooth
transitions between acute care settings
and home and community-based
settings, and to preserve the individual’s
functions. Importantly, these services
must be exclusively for the benefit of
the individual, not the hospital, and
must not substitute for services that the
hospital is obligated to provide through
its conditions of participation or under
federal or state laws. However,
payments for room and board are
expressly prohibited by section
1915(i)(1) of the Act, except for respite
care furnished in a setting approved by
the state that is not the individual’s
residence.
Section 2601 of the Affordable Care
Act adds a new paragraph to section
1915(h) of the Act to permit the
Secretary, at her discretion, to approve
a waiver that provides medical
assistance for individuals dually eligible
for Medicare and Medicaid (‘‘dual
eligibles’’) for an initial period of up to
5 years and renewed for up to 5 years,
at the state’s request. The statute defines
a dual eligible as: ‘‘an individual who is
entitled to, or enrolled for, benefits
under part A of title XVIII, or enrolled
for benefits under part B of title XVIII,
and is eligible for medical assistance
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under the state plan under this title or
under a waiver of such plan.’’ This new
authority enhances existing tools
available to improve and coordinate
care and services for this particularly
vulnerable group of beneficiaries. This
change provides an important tool for
states to design programs to better
coordinate services for dual eligible
individuals.
Section 1902(a)(32) of the Act
generally states that ‘‘no payment under
the plan for care and services provided
to an individual shall be made to
anyone other than such individual or
the person or institution providing such
care or service, under an assignment or
power of attorney or otherwise.’’
However, section 1902(a)(32) of the Act
contains several specific exceptions to
the general principle of direct payment
to individual practitioners. There are
exceptions for payments for practitioner
services where payment is made to the
employer of the practitioner, and the
practitioner is required as a condition of
employment to turn over fees to the
employer; payments for practitioner
services furnished in a facility when
there is a contractual arrangement under
which the facility bills on behalf of the
practitioner; reassignments to a
governmental agency, through a court
order, or to a billing agent; payments to
a practitioner whose patients were
temporarily served by another identified
practitioner; or payments for a
childhood vaccine administered before
October 1, 1994.
Section 1915(k)(1)(A)(ii) of the Act
provides that home and communitybased attendant services and supports
must be provided in a home and
community-based setting. The statute
specifies that home and communitybased settings do not include a nursing
facility, institution for mental diseases,
or an intermediate care facility for the
mentally retarded.3 We are aware of
settings other than those specified in
section 1915(k)(1)(A)(ii) of the Act that
may exhibit qualities of an institutional
setting, such as public hospitals. Over
the past several years, we have sought
input on how to define the
characteristics of what makes a setting
‘‘home and community-based’’ (HCB).
To provide greater clarity, we are
establishing with this final rule that
home and community-based settings
must exhibit specific qualities to be
eligible sites for delivery of HCBS under
Medicaid. Any modifications to these
qualities must be justified in an
3 Although we recognize that the language used
here is outdated, and that ‘‘intellectual disability’’
is the appropriate way to discuss this type of
disability, the Social Security Act still refers to
these types of facilities in this manner.
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individual’s person-centered plan, and
we believe this gives states the
flexibility to address specific needs of
beneficiaries. We have included these
provisions to move toward a stronger
articulation of the qualities that make a
setting a home and truly integrated in
the broader community. These are the
qualities most often articulated by
persons with disabilities as key
determinants of independence and
community integration. We believe that
these qualities of home and communitybased settings will support the use of
the Medicaid program to maximize the
opportunities for individuals to access
the benefits of home and community
living. We expect states electing to
provide benefits under section 1915(k),
1915(i), and/or 1915(c) to include a
definition of home and communitybased setting that incorporates these
qualities and will review all SPAs and
1915(c) waivers to determine whether
they propose settings that are home or
community-based. We will permit states
with approved section 1915(k) SPAs,
1915(i) SPAs, and 1915(c) waivers a
reasonable transition period to come
into compliance with the HCB setting
requirements as promulgated in our
final rule.
For a detailed description of the
background of this rule, please refer to
‘‘State Plan Home and CommunityBased Services, 5-Year Period for
Waivers, Provider Payment
Reassignment, and Setting
Requirements for Community First
Choice’’ proposed rule published in the
May 3, 2012 Federal Register (77 FR
26362).
B. Provisions of the Proposed
Regulations and Analysis of and
Responses to Public Comments
On May 3, 2012, we published a
proposed rule (77 FR 26362) in the
Federal Register entitled ‘‘Medicaid
Program; State Plan Home and
Community-Based Services, 5-Year
Period for Waivers, Provider Payment
Reassignment, and Setting
Requirements for Community First
Choice,’’ (hereinafter referred to as
‘‘HCBS proposed rule’’) that proposed to
amend the Medicaid regulations to
define and describe state plan home and
community-based services (HCBS)
under the Affordable Care Act. This rule
offers states new flexibilities in
providing necessary and appropriate
services to elderly and disabled
populations. The rule also proposed to
amend Medicaid regulations consistent
with the requirements of section 2601 of
the Affordable Care Act, which added
section 1915(h)(2) to the Act to provide
authority for a 5-year duration for
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certain demonstration projects or
waivers under sections 1115, 1915(b),
(c), or (d) of the Act. In addition, the
proposed rule includes payment
reassignment provisions because states’
Medicaid programs often operate as the
primary or only payer for the class of
practitioners that includes HCBS
providers. Finally, the rule proposed
Medicaid regulations to provide home
and community-based setting
requirements related to section 2401 of
the Affordable Care Act for the section
1915(k) Community First Choice State
plan option.
We received a total of 401 timely
comments from state agencies, advocacy
groups, health care providers,
employers, health insurers, health care
associations, and the general public.
The comments ranged from general
support or opposition to the proposed
provisions to very specific questions or
comments regarding the proposed
changes. We note that many expressed
overall satisfaction with the benefit as a
whole, in that it offers another
opportunity for individuals served
through the Medicaid program to return
or remain in the community with family
and friends. A couple stated that this
opportunity offers additional flexibility
and will not only provide people the
opportunity to live and thrive where
they choose, but also has the potential
to save states’ dollars.
After consideration of comments
received in response to the Community
First Choice (CFC) proposed rule
published in the Federal Register on
February 25, 2011, we revised the
setting provision and published our
proposed definition as a new proposed
rule to allow for additional public
comment before this final rule. Since
CFC and section 1915(i) both pertain to
home and community-based services,
we have aligned this CFC proposed
language with the section 1915(i)
proposed home and community-based
setting requirements also included in
this rule.
Brief summaries of each proposed
provision, a summary of public
comments we received (with the
exception of specific comments on the
paperwork burden or the economic
impact analysis), and our responses to
the comments follow. Comments related
to the paperwork burden and the impact
analyses are addressed in the
‘‘Collection of Information
Requirements’’ and ‘‘Regulatory Impact
Analysis’’ sections in this preamble.
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1. 5-Year Period for Certain
Demonstration Projects and Waivers
(part 430)
In accordance with section 2601 of
the Affordable Care Act, we proposed a
5-year approval or renewal period,
subject to the discretion of the
Secretary, for Medicaid waivers under
sections 1915(b), 1915(c), 1915(d) and
1115 of the Act. Specifically, this time
period applies for demonstration and
waiver programs through which a state
serves individuals who are dually
eligible for both Medicare and Medicaid
benefits. While section 2601 of the
Affordable Care Act did not provide a
new type of waiver, it did provide an
important opportunity for states to
simplify the operation of existing or
future waivers under current authorities
that serve dually eligible individuals,
especially important when states
combine waiver authorities that have
different approval periods. The approval
of such periods is at the Secretary’s
discretion, and determinations will be
made regarding applications for 5-year
waivers in a manner consistent with the
interests of beneficiaries and the
objectives of the Medicaid program. We
proposed that if a demonstration or
waiver program does not serve or
excludes dually eligible individuals, the
5-year approval period will not be
available under this authority, and
existing approval period requirements
will apply. In addition, we proposed
that in order for coverage-related
waivers to be approved for 5 years
periods, they must meet all necessary
programmatic, financial, and quality
requirements.
Comment: Commenters on this
section expressed agreement with this
provision. One also requested that we be
mindful of the demonstrations under
the Financial Alignment Initiative for
dual eligibles. Another recommended
clarification that this provision would
also apply to other future waiver
demonstration requests by states to
combine Medicare and Medicaid
funding at the state level for delivering
care to Medicare-Medicaid eligibles.
Response: This provision is available
for waivers that serve dually eligible
individuals, under sections 1915(b),
1915(c), 1915(d) and 1115 of the Act,
and that meet all necessary
programmatic, financial, and quality
requirements.
Comment: One commenter requested
that CMS make wise and appropriate
use of this authority. Another
commenter recommended that CMS
include a statement in the regulation
language like one in the preamble to the
proposed rule that determinations ‘‘be
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made regarding applications for 5-year
waivers in a manner consistent with the
interests of beneficiaries and the
objectives of the Medicaid program.’’
This commenter stated that one example
would be a waiver that effectively
reduces services for dual eligibles,
which should not be approvable as it
would not be consistent with the
purposes of Title XIX.
Response: We have added ‘‘and in a
manner consistent with interests of the
beneficiaries and the objectives of the
Medicaid program’’ to the final
regulation. In the event that the state
finds a need to make reductions to its
program, the state would have to
explain to CMS how they will account
for the interest of individuals before
taking such action.
2. State Organization and General
Administration (part 431)
In § 431.54, we proposed to add
paragraphs (a)(3) and (h) to include state
plan HCBS as exceptions to
comparability and community income
and resource rules. For specific
discussion, see the published May 3,
2012 proposed rule (77 FR 2012 through
10385).
Comment: Commenters requested that
we clarify that under section 1915(i)(3)
of the Act noncompliance with
comparability or community income
and resource rules is optional, not
mandatory. Specifically, they requested
that we modify § 431.54 (a)(3) and (h) as
follows:
• For § 431.54 (a)(3): Section 1915(i)
of the Act provides that if a state may
provide, as medical assistance, home
and community-based services under an
approved state plan amendment that
meets certain requirements, it may elect
to do so without regard to the
requirements of sections 1902(a)(10)(B)
and 1902(a)(10)(C)(i)(III) of the Act, with
respect to such services only.
• For § 431.54(h): State plan home
and community-based services. If the
state so elects, the requirements of
§ 440.240 of this chapter related to
comparability of services do not apply
with respect to State plan home and
community-based services defined in
§ 440.182 of this chapter.
Response: We believe that the
language in the regulation is clear and
we are finalizing the rule as proposed.
3. Eligibility in the States, District of
Columbia, the Northern Mariana
Islands, and American Samoa (part 435)
and Eligibility in Guam, Puerto Rico and
the Virgin Islands (part 436)
We received several comments that
were in support of the eligibility
policies pertaining to the new eligibility
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2953
group specified at § 435.219 and
§ 436.219. Commenters were pleased
that the regulation offers states
flexibility in providing HCBS to elderly
and disabled populations who do not
meet an institutional level of care.
Commenters were also pleased that the
methodology proposed for the new
eligibility group described at
§ 435.219(a) & (c) did not have a
resource test and that the income
standard for this new eligibility group is
set at 150 percent of the FPL. Comments
on eligibility policies not contained in
this rule are not addressed.
Comment: A few commenters
believed that the language in the
regulation should be more detailed to
better reflect the language in the
preamble.
Response: We do not believe that the
regulatory language should be as
detailed as the language in the
preamble. The language in the preamble
contains the rationale for the
requirements described in the regulatory
language. Therefore, we are not revising
the regulatory language to be as detailed
as the preamble. We will be revising the
regulatory language to correct an error
which inaccurately indicated that a
State could cover some but not all
people described in paragraph (a) or (b).
The response to that comment is
addressed separately.
Comment: A few commenters
suggested that the regulation at
§ 435.219(c) should be revised to
include a requirement that the
methodology elected by the state can be
no more restrictive than the SSI
methodology.
Response: To provide states with
flexibility, we are not prescribing a
methodology. We will review the
methodology proposed by the state to
determine whether it meets the criteria
set forth at § 435.219(c) and
§ 436.219(c). We believe that the current
regulatory language is in the best
interest of the beneficiary.
Comment: One commenter suggested
revising the introductory language in
§ 435.219 and § 436.219 to make it
clearer that a state may choose to cover
persons described in paragraph (a),
persons described in paragraph (b) or
both sets of persons. The commenter
suggested deleting the language ‘‘any
group or groups of’’ because the
language suggests inaccurately that a
state might be able to cover some but
not all of the persons described in either
of paragraphs (a) or (b) of the regulation.
Response: We agree with the
commenter. The state has the option to
provide Medicaid to individuals
described in one or both of the
paragraphs under (a) or (b) of this
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section but cannot cover some but not
all of the individuals that may be
eligible under either or both parts of the
eligibility group. We are revising the
regulatory language at § 435.219 and
§ 436.219 by removing the phrase ‘‘any
group or groups of.’’
Comment: A few commenters
suggested that the language in § 453.219
should be revised to specify that any
income methodologies must be applied
to all members of the eligibility group.
Response: The state must use the
same income methodology for all
members within the eligibility group.
Specifically, if a state elects to cover
§ 435.219(a) the income methodology
must be the same for all members
determined eligible under § 435.219(a).
If the state elects § 435.219(b) the state
must use the same income and resource
methodologies and standards that it
uses for the § 435.236 (the special
income level) group. As described in the
previous comment, states have the
option to provide Medicaid to
individuals described in one or both of
the paragraphs under (a) or (b) of this
section.
Comment: One commenter
commended CMS for proposing
regulations to implement optional
categorical eligibility for Medicaid for
individuals in need of section 1915(i) of
the Act services. The commenter
believes that this category has the
potential to help secure coverage for
uninsured and underinsured
individuals and will provide states with
a useful option to consolidate coverage
groups.
Response: The intent of the regulation
is to provide eligibility for more
individuals needing State plan HCBS
not to consolidate coverage groups.
Comment: One commenter urged
CMS to retain the regulatory language
that requires states to use income
standards, which are, ‘‘reasonable,
consistent with the objective of the
Medicaid program . . . and in the best
interest of the beneficiary.
Response: We are not changing this
regulatory language, which is specified
at § 435.219(c) and § 436.219(c).
4. Services: General Provisions (part
440)
Section 1915(i)(1) of the Act grants
states the option to provide, under the
state plan, the services and supports
listed in section 1915(c)(4)(B) of the Act
governing HCBS waivers. The HCBS
may not include payment for room and
board. Eligibility for this option is based
upon several different factors that are
either specified by the statute or that a
state may define. These include
financial eligibility, the establishment of
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needs-based criteria, and the state
option to target the benefit and to offer
benefits differing in type, amount,
duration or scope to specific
populations. Section 1915(i) of the Act
provides that State plan HCBS may be
provided without determining that, but
for the provision of these services,
individuals would require the LOC
provided in a hospital, a nursing facility
(NF), or an intermediate care facility for
individuals with intellectual disabilities
(ICF/IID) as is required in section
1915(c) HCBS waivers. While HCBS
provided through section 1915(c)
waivers must be ‘‘cost-neutral’’ as
compared to institutional services, no
cost neutrality requirement applies to
the section 1915(i) State plan HCBS
benefit. State plan HCBS are intended to
enable individuals to receive needed
services in their own homes, or in
alternative living arrangements in what
is collectively termed the ‘‘community’’
in this context.
Comment: A few commenters
requested that CMS add additional
services to § 440.182. One additional
commenter requested that nursing
services be added to the list of services
specifically listed in section
1915(c)(4)(B) of the Act governing HCBS
waivers.
Response: The services that section
1915(i)(1) of the Act authorizes states to
include are the services and supports
listed in section 1915(c)(4)(B) of the Act
governing HCBS waivers. While we are
unable to expand on this list of services,
we note that the ‘‘other services’’
specifically referenced in the statute
may include coverage of services not
designated in the list of specific
services, and gives states the flexibility
to propose and define other specific
services.
Comment: Many commenters
requested that CMS add to the
regulation text that ‘‘other services’’ can
include services that have been, or
could be, approved as ‘‘other services’’
under a 1915(c) waiver and to list
specific examples, such as transition
services or services for individuals with
traumatic brain injury.
Response: ‘‘Other services’’ may
include coverage of services not
specifically designated, and states have
the flexibility to propose and define
other specific services. We will provide
examples of ‘‘other services’’ in future
guidance.
Comment: A couple of commenters
requested revisions to § 440.182(c) to
emphasize that the habilitation services
that can be covered by the state include,
but are not limited to, expanded
habilitation services as specified in
§ 440.180(c).
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Response: We have revised
§ 440.182(c) to add the phrase ‘‘may
include expanded habilitation services’’
to specify that states can choose
whether or not to include expanded
habilitation services as defined in
§ 440.180(c).
Comment: One commenter expressed
that the final regulation regarding home
and community-based settings must
continue to permit the full array of
home and community-based services, as
defined by the Medicaid HCBS statute
and regulations and included in the
individual’s person-centered service
plan.
Response: We agree and, as in the
proposed rule, the final regulation will
continue to convey this flexibility for
states.
Comment: Another commenter
applauded the flexibility given to states
to not only provide specified HCBS
benefits under the state Plan, but to also
provide other services at a state’s
request with Secretary approval, and
encourages CMS to work with states on
an ongoing basis to educate, train, and
support the use of this new state plan
option.
Response: We appreciate this
comment and believe that this option
provides states with an opportunity to
deliver long-term supports and services
to individuals in need. Since
implementation of this benefit, we have
directly and indirectly provided states
with technical assistance in the use of
section 1915(i) of the Act, and we are
committed to continuing to offer such
assistance to states.
Comment: One commenter stated that
CMS should not allow section 1915(i) of
the Act to be used to provide
instrumental activities of daily living
(IADL) services while an individual is
in a general acute hospital short-term
stay, as this would be duplicative to the
services received in the hospital and
would be hard to administer without
increased costs to the state.
However, another commenter was
supportive of allowing HCBS to
continue, as applicable for people who
are temporarily hospitalized, stating that
based on the needs of the individual,
there could be a genuine necessity for
HCBS while an individual is
hospitalized in a short-term acute care
setting and would not be a duplication
of hospital care services:
‘‘Some individuals may need assistance
from their personal care provider to
communicate their needs, medical history,
redirect behaviors, and provide consistent
person-directed physical assistance. Most
hospitals do not have adequate, nor trained
staff to provide the level and type of ongoing
‘personal care’ many people using HCBS
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require. Providing continuation of HCBS
while someone is in a hospital is not letting
hospitals avoid their responsibilities, but
rather acknowledging the reality that their
focus/responsibility is on ‘medical care’,
while HCBS’ focus is on ‘personal care’.’’
Response: We agree with the second
commenter and believe that this should
remain an option afforded to the state
subject to the conditions and limitations
stated in our rule. To support program
integrity, states are required to perform
claims edits or adopt other systematic
approaches that prevent duplicate
payment.
Comment: One commenter noted that
the inclusion of ‘‘other services’’
including certain transition services can
make a significant difference in
addressing chronic homelessness.
Response: We agree.
Comment: One commenter suggested
providing FFP for rent and food
expenses reasonably attributed to a
related caregiver providing State plan
HCBS, just as CMS proposed in the
proposed rule for unrelated caregivers.
Response: Section 1915(i) of the Act
does not include authority that would
allow payment for the costs of rent and
food attributable to a related personal
caregiver residing in the same
household as the participant.
Comment: One commenter asked us
to clarify if there can be differences in
the amount, scope or duration of
services provided under 1915(i) and
similarly named services provided in a
section 1915(c) HCBS waiver, and
whether rates or rate methodologies
could differ. The commenter also asked
whether there could be different
provider qualifications for a covered
State plan HCBS benefit and a similar
covered HCBS waiver service.
Response: States are permitted the
flexibility to define the section 1915(i)
of the Act services they will include
under their benefit, including the
amount, duration, and scope of those
services. If a proposed section 1915(i)
service is also available under another
Medicaid authority, states must explain
how the section 1915(i) services would
not be provided in duplicate, or incur
duplicate payment. However, we note
that while 1915(i) services are not
identified in 1905(a) and are not part of
the EPSDT requirement, all Medicaideligible children must have full access
to services required under EPSDT, and
the provision of section 1915(i) of the
Act State plan HCBS should in no way
hinder their access to such services.
With regard to rate methodologies,
while rate determination methods may
vary, payments for Medicaid services
must be consistent with the provision of
section 1902(a)(30)(A) of the Act (that is,
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‘‘payments are consistent with
efficiency, economy, and quality of care
and are sufficient to enlist enough
providers’’) and the related federal
regulations at § 447.200 through 205. If
the state-established rates will vary for
different providers of a service
(including a service that is also available
under a section 1915(c) of the Act
waiver), the state must explain the basis
for the variation.
Provider qualifications must be
reasonable and appropriate to the nature
of the service, reflect sufficient training,
experience and education to ensure that
individuals will receive services in a
safe and effective manner, and not have
the effect of limiting the number of
providers by the inclusion of
requirements that are unrelated to
quality and effectiveness. If the stateestablished minimum provider
qualifications will vary for a service that
is also available under a section 1915(c)
of the Act waiver, the state must explain
the basis for the variation.
Comment: One commenter requested
that CMS amend the language to ensure
that the rule addresses individuals with
disabilities across the lifespan,
including children, in order to help
states understand that they can serve
children under the special population
classification. They expressed concern
that the proposed rule does not
explicitly address children. They also
requested that CMS add language to
specify children with physical and
sensory disabilities, not just those with
cognitive and behavioral disorders.
Response: Our intention was not to
exclude children with disabilities or any
other population as we cited examples
in the preamble to the proposed rules.
The regulation text does not cite specific
populations who can receive Medicaid
HCBS, nor do we think it prudent to do
so, as it may imply limitations on state
flexibility.
Comment: One commenter requested
that CMS allow federal financial
payment for room and board costs to be
included in payment for State plan
HCBS, in order to make such
alternatives viable for individuals who,
without housing assistance, must seek
institutional placement.
Response: The statute explicitly
excludes coverage of room and board
and our rule cannot override that
exclusion.
Comment: For § 440.182(c)(8), which
refers to conditions set forth at § 440.180
for persons with chronic mental illness,
one commenter proposed instead a
reference to § 440.180(d)(2).
Response: We agree that this reference
is more precise and have incorporated
this revision.
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2955
Comment: One commenter expressed
support for not including the phrase ‘‘as
cost effective and necessary to avoid
institutionalization,’’ which appears in
§ 440.180(b)(9) to describe the ‘‘other’’
services that might be authorized under
section 1915(c) of the Act, in
§ 440.182(c)(9) pertaining to section
1915(i) of the Act.
Response: We agree that this phrase is
not appropriate to include in
§ 440.182(c)(9), as State plan HCBS
under 1915(i) are not subject to cost
neutrality.
Comment: One commenter indicated
that the regulation text should indicate
that services must be furnished to
individuals with an assessed need, and
must not be based on available funds.
Response: This is reflected in
§ 441.725(b) regarding the personcentered service plan.
Income Eligibility:
Section 1915(i)(1) of the Act requires
that in order to receive State plan HCBS,
individuals must be eligible for
Medicaid under an eligibility group
covered under the State’s Medicaid
plan. In determining whether either of
the relevant income requirements
(discussed) is met, the regular rules for
determining income eligibility for the
individual’s eligibility group apply,
including any less restrictive income
rules used by the state for that group
under section 1902(r)(2) of the Act.
Section 2402(b) of the Affordable Care
Act added a new option at section
1915(i)(6) of the Act, to allow states, in
addition to continuing to provide
services to individuals described in
section 1915(i)(1) of the Act, to provide
section 1915(i) of the Act services to
certain individuals who meet the needsbased criteria, who would be eligible for
HCBS under sections 1915(c), (d) or (e)
of the Act waivers or a section 1115
waiver approved for the state, and who
have income up to 300 percent of the
Supplemental Security Income Federal
Benefit Rate (SSI/FBR).
Section 2402(d) of the Affordable Care
Act also amended section
1902(a)(10)(A)(ii) of the Act by adding a
new optional categorically needy
eligibility group specified at section
1902(a)(10)(A)(ii)(XXII) of the Act to
provide full Medicaid benefits to certain
individuals who will be receiving
section 1915(i) services. This eligibility
group has two parts, and states can
cover individuals under either or both
parts of the group. Under this group,
states can elect to cover individuals who
are not otherwise eligible for Medicaid
who meet the needs-based criteria of the
section 1915(i) of the Act benefit, have
income up to 150 percent of the Federal
poverty line (FPL) with no resource test
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and who will receive section 1915(i) of
the Act services, or individuals with
income up to 300 percent of the SSI/
FBR, who would be eligible under an
existing section 1915(c), (d) or (e) 4
waiver or section 1115 waiver approved
for the state and who will receive
section 1915(i) services. These
individuals do not have to be receiving
services under an existing section
1915(c), (d) or (e) waiver or section 1115
waiver; the individual just has to be
determined eligible for the waiver.
Comment: One commenter indicated
that there is not a lot of difference
between 300 percent FBR and 150
percent FPL. In 2012 the amounts were
$2094 versus approximately $1400 per
month. The commenter believes that
having two income levels to administer
will cause more work for the states and
make explaining the program more
confusing. The commenter
recommended that for all 1915(i)
services, the income standard be 300
percent of the SSI/FBR.
Response: The statute does not permit
the income standard to be raised to 300
percent of the SSI/FBR for all
individuals receiving 1915(i) services.
Electing the new eligibility group
specified at § 435.219 and § 436.219 in
order to provide state plan HCBS to
individuals who were not previously
eligible to receive these services is
strictly a state option. Therefore, if a
state believes that the requirements for
this eligibility group are too
burdensome, the state does not have to
elect to cover this optional eligibility
group.
Comment: One commenter believes
that existing financial eligibility rules
should remain in place.
Response: Electing any changes to
financial eligibility set forth in this final
rule are strictly a state option.
5. State Plan Home and CommunityBased Services Under Section 1915(i)(1)
of the Act (§ 441.710) (Proposed
§ 441.656) and Community First Choice
State Plan Option: Home and
Community-Based Setting Requirements
(§ 441.530)
a. Home and Community-Based
Settings Under 1915(i) and 1915(k) of
the Act
To implement the statutory
requirement that the benefit be ‘‘home
and community-based,’’ we proposed to
require in § 441.656(a) that the
individual reside in the home or
community, not in an institution, and
4 1915(d) and (e) waivers are State options to
provide HCBS to the elderly and to individuals
with disabilities, respectively. Currently, no State
elects to provide services under either of these
authorities.
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that the settings must have qualities of
community-based settings prescribed by
the Secretary. We stated our recognition
of the need for a consistent definition of
this term across Medicaid HCBS, and
our goal to align the final language
pertaining to this topic across the
regulations for sections 1915(i), 1915(k),
and 1915(c) of the Act Medicaid HCBS
authorities.
Section 1915(i) of the Act provides
states the option to provide home and
community-based services, but does not
define ‘‘home and community-based.’’
Along with our overarching interest in
making improvements to Medicaid
HCBS, we seek to ensure that Medicaid
is supporting needed strategies for
States in their efforts to meet their
obligations under the ADA and the
Supreme Court decision in Olmstead v.
L.C., 527 U.S. 581 (1999). We proposed
language defining the qualities and
requirements for settings in which
section 1915(i) of the Act services and
supports could be provided and sought
additional comments on this issue.
Instead of attempting to provide one
singular definition to encompass all
settings that are home and communitybased, we described the qualities that
apply in determining whether a setting
is community-based. We stated that we
would expect states electing to provide
HCBS under section 1915(i) of the Act
to include a definition of home and
community-based settings that
incorporates these qualities, and that we
would review all SPAs to determine
whether they propose settings that are
home and community-based.
In the proposed rule, we stated that
we would permit states with approved
section 1915(i) of the Act SPAs a
reasonable transition period, a
minimum of one year, to come into
compliance with the HCBS setting
requirements that are promulgated in
our final rule.
Overall, we received 280 comments in
response to the HCB settings section of
the proposed rule regarding 1915(i)
State plan HCBS and 1915(k) CFC.
Commenters included advocacy
organizations, individuals receiving
services, family members, friends and
guardians of individuals receiving
services as well as providers,
government entities and the general
public. Because we are proposing the
same requirements for home and
community-based settings in regulations
implementing 1915(i) and 1915(k), we
are discussing comments pertaining to
both in this section. The comments were
mixed, with commenters providing both
support and disagreement within
subsections of the HCBS settings
provision. A few of the issues that
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elicited a substantial number of
comments are: qualities, integration,
providers, choice, accessibility and
privacy in addition to general
comments.
Comment: We received many
comments related to this section of the
proposed rule. These comments are
reflected as follows:
Many commenters expressed concern
about the effect the criteria will have on
existing home and community-based
services, and expressed concern that the
proposed rule will eliminate community
based-services that elderly individuals
and people with disabilities are
currently receiving. Several commenters
suggested eliminating all provisions that
restrict the consumer’s freedom of
choice regarding the residential settings
in which they can utilize their Medicaid
funds, stating that the qualities and
characteristics of home are determined
by the individual.
Some commenters stated that
affordable rental options, especially
those in apartment complexes where
home maintenance responsibilities are
handled by the landlord, are hard to
find or non-existent in some
communities. They indicated that lack
of affordable housing is a huge
challenge for people seeking to live in
the community while being supported
for severe disabilities, and that many
individuals who experience multiple
disabilities need housing that is tailored
for their specific physical needs. These
commenters stressed that group homes
that were built and owned by a third
party, specifically for the purpose of
serving people with disabilities, would
not be available if they tried to rent on
the open market and that ruling out
such homes for HCBS funding imposes
further hardship and segregation on the
population in need of HCBS.
One commenter believes the
requirements will drive up costs.
Some commenters believe that the
changes would effectively eliminate
their freedom to provide their adult
child a setting that is protected from
exposure to community members that
do not understand the effect of a
community’s environment on
individuals with disabilities.
One commenter indicated that if
adopted, the criteria would have a
significant adverse impact on its ability
to continue to serve individuals with
the most significant disabilities in the
community. The language included in
the proposed regulation would: (1)
Thwart informed choice by negating or
severely restricting longstanding
program options and opportunities to
provide services and supports expressly
authorized by the HCBS provisions of
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the Medicaid statute and regulations;
and (2) Significantly restrict state
flexibility to respond to identified needs
of Medicaid beneficiaries.
Some commenters stated within the
broad disability community, different
groups have different needs and desires
and any definition of home and
community-based needs to be broad
enough to encompass these divergent
needs and desires with one not
outweighing others. They indicated that
it may not be possible to have a single
definition to meet these needs.
One commenter stated that the
standards proposed for home and
community-based settings are
impractical, overly prescriptive,
inappropriate for persons with cognitive
impairments and neurobehavioral
challenges, and cannot be delivered at a
rate that states and taxpayers can afford.
Another commenter disagreed with
eliminating congregate care options and
requested CMS clearly state policies
which encourage states to operate a
range of services for people with
disabilities which reflect the diversity of
their care and that of their families,
including congregate care.
Several commenters disagreed with
the notion embedded in the CMS
proposal that ‘‘community based’’ can
only be defined as a totally independent
setting or small stand-alone group home
in an urban or suburban environment.
We received many comments
supporting the proposed criteria. These
indicate that the criteria are a step in the
right direction and support the goal of
HCBS to assist individuals to be able to
live fully in the greater community. One
of these commenters stated that the
criteria proposed appropriately establish
the essential elements of resident
autonomy and person-centered care.
Many commenters stated their belief
that the provisions are key to assisting
states with complying with the
Olmstead decision. One recommended
that the regulation quote verbatim the
conclusion of the Olmstead decision
and that reference to the ‘‘integration
mandate’’ in the final regulation restates
actual language in the ADA regulations
for instance, ‘‘most integrated setting
appropriate to the needs of qualified
individuals with disabilities.’’
Another indicated that the
requirements appropriately ensure that
individuals have control over their care
environment while also making
allowances for serving people with
cognitive disabilities. Several
commenters stated that the rule offers
appropriate flexibility to ensure that
individuals can remain in the
community for as long as possible.
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Many commenters commended CMS
for its efforts to promote the rights of
people with disabilities to live in the
most integrated setting possible. They
stated that the proposed rule has the
potential to improve the care of many
adults and children in the public mental
health and developmental disabilities
system.
A few commenters stated that making
an institutional setting more ‘‘homelike’’
does not mean that it becomes
community-based, and that the intent is
to ensure that people with disabilities
have more self-direction and ability to
govern and control important
components of their personal living
environment.
One commenter stated appreciation
and support for criteria that support
individual choice, the ability for a
recipient to exercise control over his or
her immediate environment and day to
day activities, and that do not restrict
the individual’s ability to live in the
community in which his or her
residence is located. However, the
commenter is concerned that residency
in some of the more creative
congregated living arrangements may be
disqualified. The commenter added that
CMS should be as flexible as possible to
ensure that these homes are able to
continue to support individuals with
disabilities and illnesses in the least
restrictive environment possible.
Response: We appreciate all of the
comments submitted. We believe the
requirements we are finalizing are
critical to ensure that individuals have
the opportunity to receive services in a
manner that protects individual choice
and promotes community integration.
Individuals who are elderly and/or
disabled who commented made it clear
that their personal rights should not be
curtailed because of where they live or
because there is a need to receive HCBS.
It is not the intent of this rule to prohibit
congregate settings from being
considered home and community-based
settings. State plan HCBS must be
delivered in a setting that meets the
HCB setting requirements as set forth in
this rule (except for HCBS that may be
delivered in an institutional setting,
such as institutional respite). Also, since
this authority provides states the
opportunity to provide individuals
HCBS and not institutional services,
individuals must be living in settings
that comport with the HCB setting
requirements as set forth in this rule.
We acknowledge that for some settings,
implementing these requirements will
require a change to operational protocol,
and perhaps changes to licensure
requirements, but we believe that the
requirements are achievable and
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provide for reasonable transition time to
facilitate such changes as may be
necessary. We are committed to working
with states as they examine their
systems and develop plans to bring their
HCBS programs/benefits into
compliance.
Comment: One commenter noted that
Medicaid reimbursement for room and
board is expressly prohibited, yet the
criteria laid out in §§ 441.530 and
441.656(a) are primarily focused on
considerations of what is a beneficiary’s
room and board choice and therefore
arguably outside CMS’ authority to
regulate. This commenter stated that
CMS lacks authority to regulate these
features of alternative housing
arrangements for which it does not
provide reimbursement and requested
that CMS clarify under what authority
CMS can mandate physical structure
alternative housing requirements and
whether such authority extends to nonprovider controlled alternative housing
arrangements. Other commenters stated
that creating an exhaustive list of
potential requirements will be difficult
and suggested that CMS carefully
consider the wide range of states’
specific programs over the next year
before providing guidance through a
State Medicaid Director letter.
Response: While we do not regulate
housing, we are required to determine
whether Medicaid State plans and
waivers comply with the statutes
authorizing the provision of medical
assistance. In authorizing HCBS
Medicaid expenditures, we must ensure
that such settings are home and
community-based.
Comment: We received many
comments in response to our request for
input on whether the regulation should
be modified to prohibit housing
providers from requiring individuals to
receive services from that provider, or
requiring an individual to receive a
particular service as a condition of
living or remaining in the setting. Many
commenters believe that housing should
not be conditioned upon the acceptance
of services and believe that individuals
should have the right to choose their
living environment, as well as their
supports and services. Some
commenters expressed concern that
such an arrangement is inconsistent
with the requirement that Medicaid
beneficiaries have a free choice of
provider. Other commenters believe that
if assisted living facilities, and other
congregate settings that bundle housing
and services, were required to separate
housing and services, those providers
could maintain their customer base by
providing services of a quality that
appeals to individuals, not by taking
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advantage of a captive pool of residents.
Others expressed concern that people
would become homeless or
institutionalized because the services
they require change, and individuals are
not given the opportunity to age in
place. Some commenters believe that
individuals should have the opportunity
to make their own decisions about
where they live, free of any coercion.
One commenter supporting the
restriction acknowledged that
compliance with such a provision
would require monumental changes to
certain business models and service
delivery systems and that such a change
may be beyond the scope of this
regulation. Overall, the commenters
supporting the prohibition believe that
individuals with disabilities deserve
choice among livable options and
control over the space they call home.
Alternatively, we received comments
opposing a separation of housing
services requirement, stating that it is
too restrictive. Some commenters
expressed concern that such a
requirement would limit a provider’s
ability to evict tenants who become a
threat to other tenants and staff or
repeatedly refuse a particular service
that would treat their medical
condition. Other commenters believe
that while the inclusion of this criterion
is important in some settings, such as an
individual’s home or apartment, it
should not be applied to settings such
as group homes or assisted living
residences, where the provision of
services is inherent in the setting.
Several commenters suggested that
instead of modifying the regulation to
require separating housing and services,
this issue could be handled in a
different manner, such as the use of
resident agreements in specific
residential settings or through the
person centered planning process.
Commenters believe that this regulation
should not preclude reasonable
conditions for residency that are
consistent with the rules of the
regulating agency. There is also concern
with the effect such restriction could
have on specialized programs, such as
those targeted toward the homeless
population. Such programs include
residential services and require
individuals to maintain sobriety. Other
commenters expressed concern
regarding how such a requirement
would be operationalized in assisted
living facilities whose model is to
provide both housing and services. In
such settings, multiple service providers
and multiple staff with multiple lines of
authority, sorting through oversight and
management issues becomes very
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complex. A few commenters suggested
that CMS should provide guidance that
as a matter of practice, individuals
should not be locked into a particular
service package as a condition of their
receipt of housing services. Other
commenters suggest that in
arrangements where placement is
contingent on acceptance of a specific
program, it should be clearly specified
as part of the person-centered planning
process that individuals have been
apprised of all alternatives and that the
decision to accept the placement is free
from coercion. The commenter notes
that adult care and assisted living
facilities are also guided by state
regulations and in most cases these
regulations indicate that residents may
not reside in the facility if they are a
threat to themselves or others. The
commenter explains that if a facility
fails to ‘‘discharge’’ a resident to a more
appropriate environment, the facility
may be in conflict with those state
regulations, running the risk of being
cited with a deficiency or
endangerment, which can threaten its
viability.
Response: Upon consideration of the
thoughtful comments submitted, we are
not requiring the separation of the
housing provider from the provider of
HCBS. Commenters provided
compelling arguments both in support
and against the proposed prohibition.
We recognize that the needs of the
individuals receiving HCBS vary
greatly. Just as there should be a variety
of service options to meet those needs,
there should be a variety of residential
options as well. We agree with
commenters that the issue of choice
regarding the provision of services can
be addressed as part of the personcentered planning process and reflected
in the individual’s person-centered
service plan. States must ensure that
when an individual chooses a home and
community based setting, the individual
has made an informed choice among
options. In the event the individual has
made an informed choice to reside in a
setting that provides both housing and
services, the individual must
acknowledge that he has also chosen
that provider to be the service provider.
Our decision not to require the
separation of housing and services in
the final rule does not preclude a state
from structuring its service delivery
system to promote separation. Nor does
it preclude a provider from allowing for
such an arrangement if all parties agree,
and the arrangement does not violate
state licensing requirements. At this
time, we do not believe that there
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should be a federal mandate requiring
such a separation.
Comment: Several commenters
requested that § 441.656(a)(1)(vi) be
modified to include a ‘‘right to refuse
service’’ provision. One commenter
suggested the following modification
‘‘in a provider-owned or controlled
residential setting, that receipt of any
particular service or support either from
the provider/owner or other qualified
provider cannot be a condition for living
in the unit and that this shall mean that
the owner of the unit cannot terminate
occupancy/tenancy of someone for not
agreeing to participate in a particular
service.’’ A few commenters suggest that
if CMS decides against including a
‘‘right to refuse service’’ provision, then
a narrow exception should be provided,
allowing the requirement to be waived
only for substance abuse treatment
services, on the grounds that such
treatment services are distinct in
character from other forms of service
provision focused on ADLs, IADLs, etc.
One commenter believes that while
providers should receive adequate
reimbursement for housing and services,
the individual should be protected
against restrictive (service utilization)
requirements for tenancy and should
maintain the right to elect, receive or
deny services without risk of eviction.
Another commenter indicated that this
interpretation could have an effect on
residential settings as some of these
settings include a structure in which
individuals are required to participate
in treatment (substance use, for
example) as a condition of residing in
the unit. Overall, the commenters
believe that individuals should not be
forced to move out of their homes
because they do not want a particular
service offered by the provider.
Response: We do not believe that a
‘‘right to refuse’’ provision is necessary
as it is a basic tenet of the Medicaid
program that individuals cannot be
compelled to receive any Medicaid
service. Additionally, we believe the
requirements specified under the
person-centered planning process, and
the requirement at § 441.530(a)(1)(iii)
and § 441.710(a)(1)(iii) that an
individual is free from coercion and
restraint, achieve the same purpose as a
‘‘right to refuse’’ provision. Although
Medicaid beneficiaries have the right to
refuse a service, we recognize that
depending on the setting, rules other
than those of the Medicaid program may
be applicable and may reflect health and
safety concerns related to the refusal of
services. We plan to issue additional
guidance on how other components of
this regulation can be useful tools in
addressing such concerns.
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Comment: Several commenters
recommend that the proposed
regulation be amended to reference the
ADA, which generally requires a
provider to accommodate a resident’s
needs by making necessary services
available to the extent that those
accommodations are setting-appropriate
and are not legally prohibited.
Commenters believe that this type of
accommodation should be required in a
community-based setting, as it values
the individual’s interest in staying in
the home over the facility’s interest in
limiting the care needs that must be
met.
Response: The requirements of this
rule do not replace or override the
requirements of the ADA. There are
already a few general provisions in our
regulations that prohibit discrimination
in State Medicaid programs on the basis
of nationality, disability, etc., (§ 430.2,
§ 435.901, § 435.905, and § 435.908). As
these regulations apply in determining
eligibility and administering the
Medicaid program generally, it is not
necessary to add a regulation on this
subject specific to section 1915(i) of the
Act.
Comment: One commenter suggested
that clear contracts and boundaries need
to be defined in order to recognize that
no matter the setting, that location is the
individual’s home.
Response: We agree with the
commenter that regardless of the type of
setting, the location is the person’s
home.
Comment: One commenter suggested
CMS include the concept of ‘‘aging in
place,’’ as defined by the Center for
Disease Control. The commenter
believes that regardless of whether or
not the setting is provider-owned or
controlled, individuals should be
protected by a reasonable
accommodation requirement in their
current settings as their needs change in
order to prevent individuals from being
evicted or losing their home. The
commenter further suggests that
individuals should also have access to
an appeals process through an objective
third party to dispute decisions about
terminations of agreements and
evictions.
Response: We do not believe this
support requires a change to the
regulations. The requirements set forth
in this final rule also address the
commenters’ additional suggestion
regarding an appeals process for
evictions and terminations of
agreements.
Comment: One commenter indicated
that their state has a long history of
providing services that are
institutionally-based, with
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misplacement of younger people in
adult care homes that are for the frail
elderly. This commenter urged CMS to
ensure that individuals have
assessments of need to ensure they are
not placed in the wrong settings.
Response: Sections 1915(c), 1915(i)
and 1915(k) of the Act all require that
individuals have an individual
assessment of needs that includes the
individual’s needs, strengths,
preferences and goals for services and
supports provided under the respective
authorities.
Comment: One commenter
appreciates CMS noting in the preamble
to the proposed rule the other
authorities for providing Medicaid
services in certain institutional care
settings (such as SNFs and ICFs), but
notes that this should not be construed
to mean that assisted living can or
should be lumped with SNFs simply
because both provide regulated services
in a congregate setting. The commenter
does not support the premise that
residents of assisted living settings
should ‘‘fall back’’ on the institutional
model in order to access Medicaid
services.
Response: It is not our intent to imply
that all congregate settings should be
categorized as nursing facilities and/or
intermediate care facilities for
individuals with intellectual
disabilities. State plan HCBS must be
delivered in a setting that meets the
HCB setting requirements as set forth in
this rule (except where HCBS are
permitted to be delivered in an
institutional setting, such as
institutional respite). Also, since this
authority provides states the
opportunity to provide individuals with
HCBS and not institutional services,
individuals must be living in settings
that comport with the HCB setting
requirements as set forth in this rule.
Settings that do not meet the
requirements may be qualified to
provide institutional services.
Comment: One commenter suggests
that states should consider whether
individuals have meaningful options
among settings located in the
community, which afford them the
choices that are integral to some of the
qualities that define HCB settings. The
commenter suggests that states should
collect data on the choices and
expressed preferences of Medicaid
beneficiaries who require HCBS and set
goals to build adequate infrastructure to
meet these needs.
Response: We appreciate the
commenters’ thoughtful suggestions.
The regulation already requires that the
setting be selected by the individual
from among housing options, and that
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the individual’s choice is documented
in the person–centered service plan. We
will not revise the regulation to include
the commenter’s suggestion to require
states to use the data on the choices and
expressed preferences to set goals to
build adequate infrastructure to meet
these needs; however, we will consider
that suggestion as we develop future
guidance.
Comment: One commenter agreed that
these requirements should apply to
other HCBS funding streams such as the
section 1915(c) waiver program.
Response: We appreciate the
commenter’s support. As stated in the
preamble of the proposed regulation,
these requirements will also apply to
section 1915(c) of the Act Home and
Community Waiver programs and the
section 1915(k) of the Act Community
First Choice state plan option.
Comment: One commenter stated that
individuals should not be forced to live
in the community, as this might not
always be the individual’s preference.
Response: This requirement does not
require individuals to live in the
community to receive necessary
Medicaid services. Medicaid services
are available in a variety of settings.
This regulation sets forth requirements
that must be met for individuals to
receive services under sections 1915(i),
(c) and (k) of the Act.
Comment: We received many
comments supporting the proposed
language. Several commenters support
CMS’ efforts in aligning HCBS setting
qualities under sections 1915(i) and
1915(k) of the Act and agree with the
proposed list of qualities for home and
community based settings at
§ 441.656(a)(1) of the proposed rule that
promote patient autonomy, dignity,
choice and preference. Several
commenters believe the provisions are
strongly reflective of the belief that
home- and community-based services
should be organized in a personcentered manner, driven by the needs
and preferences of the individual and
that those services acknowledge the
rights of the individual to ‘‘privacy,
dignity and respect’’. Several
commenters generally believe that the
provisions establish the essential
elements of autonomy and personcentered care in a way that promotes
choice and independence. Many
commenters believe that the list of
qualities promotes integration of people
with disabilities into the greater
community and does not restrict
individuals with disabilities. One
commenter recognized the policy on
this issue is complicated and believes
that the proposed language is a big
improvement over previous proposals.
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Response: We agree and appreciate
the commenters’ support.
Comment: A few commenters asked if
the rule applies to private homes and
non-residential community settings
where services may be provided, such
as adult day settings or day habilitation
settings.
Response: 1915(i) State plan HCBS
and 1915(k) CFC services (for example,
residential, day or other) must be
delivered in a setting that meets the
HCB setting requirements as set forth in
this rule. We will provide further
guidance regarding applying the
regulations to non-residential HCBS
settings. In addition, since this authority
provides states the opportunity to
provide individuals HCBS and not
institutional services, individuals
receiving 1915(i) State plan HCBS or
1915(k) CFC services must be living in
settings that comport with the HCB
setting requirements as set forth in this
rule regardless of whether they are
receiving HCBS in that residence. This
is consistent with CMS’ longstanding
policy regarding 1915(c) HCBS. We are
unsure what the commenter means by
the term ‘‘private home’’ but a residence
owned or leased by an individual for his
or her personal use would generally
meet these criteria.
Comment: One commenter suggests
that CMS should consider requiring and
monitoring state reporting on measures
related to the qualities of home and
community-based settings. The
commenter suggests alignment with
section 1915(i) of the Act quality and
reporting standards. An alternative
approach also suggested by the
commenter is for CMS to require a
Memorandum of Understanding (MOU)
between state agencies documenting
how they will work together to ensure
consistency with the quality
requirements.
Response: Sections 1915 (c), (i) and
(k) of the Act all require states to
demonstrate at the time of approval that
they have a quality improvement
strategy that includes performance and
outcome measures for the HCBS,
including measures for the HCB setting
requirements. We are currently working
towards a streamlined approach to be
used across Medicaid HCBS.
Comment: One commenter
recommended the rule be revised to
include a requirement that individual
choice regarding supplementation of
services and supports and who provides
them is facilitated, if providers meet all
applicable requirements of the licensed
entity.
Response: We do not believe it is
necessary to add language addressing
provider qualifications to this provision.
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Implementing regulations for sections
1915(c), 1915(i) and 1915(k) of the Act
all include provisions that address
provider qualification requirements.
Comment: Several commenters
indicated that people with disabilities
should have the same rights,
responsibilities and protections as
nondisabled people have under every
state’s Landlord and Tenant Law. One
commenter indicated that their state’s
landlord and tenant laws currently in
place are sufficient to satisfy the
requirements of the regulation (absent a
court order, a person may not be
involuntarily evicted even if they need
a higher level of care, are delinquent in
payment or create significant disruption
for others living in the congregate
setting). Another commenter indicated
that their state’s landlord tenant law
must operate equally for everyone.
Response: We believe these comments
are consistent with the intent of this
regulation. We note that we do not have
the authority to require states to modify
their landlord and tenant laws.
Comment: One commenter suggested
that CMS should clarify that all settings
in which the individual does not have
a regular lease or full ownership rights
should be considered ‘‘providercontrolled.’’
Response: Any setting where the
provider of HCBS also owns and
operates an individual’s residential
service is considered providercontrolled.
Comment: A few commenters
indicated that because there is no
definition of an individual’s ‘‘sleeping
or living unit’’ it is unclear what area
the individual’s rights pertain to. The
commenters requested clarification that
the ‘‘unit or room’’ to which the person
is legally entitled is at least the space to
which the rights in
§ 441.530(a)(1)(vi)(B)(1–3) should apply.
Response: The requirements set forth
at § 441.530(a)(1)(vi)(B)(1–3) apply to
the sleeping or living unit that is used
by the individual, and is not a common
area used by others residing in the
setting.
Comment: One commenter indicated
that their state’s landlord-tenant laws
and their housing with services
regulations both apply to their housing
with services settings and the
commenter wants to ensure that
anything that is finalized by CMS does
not negatively impact the consumer
based system developed over the last
two decades in that state.
Response: The proposed language
specified that ‘‘the individual has, at a
minimum, the same responsibilities and
protections from eviction that tenants
have under the landlord/tenant law of
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the state, county, city or other
designated entity.’’ However, we heard
from many commenters that depending
on the state, tenant law may not apply
to congregate settings, such as group
homes or assisted living facilities. To
address such situations, we revised
§ 441.530 and § 441.710(a)(1)(vi)(A) to
add the following language: ‘‘For
settings in which landlord tenant laws
do not apply to such units or dwellings,
the state must ensure that a lease,
residency agreement or other form of
written agreement will be in place for
each HCBS participant that provides
protections that address eviction
processes and appeals comparable to
those provided under the jurisdiction’s
landlord tenant law’’. In all instances,
these agreements must address eviction
processes and appeals. In summary, we
believe that our language creates a
minimum requirement, but allows states
to use existing laws or establish new
laws as long as they meet our minimum
requirements.
Comment: One commenter found it
difficult to support this requirement
based on the fact that each designated
entity in the same state can have
different tenant laws.
Response: It is expected that states
would establish policy and procedures
to assure compliance with this
provision.
Comment: One commenter indicated
that it might not be appropriate to
require all provider-owned and operated
settings be subject to local landlord and
tenant laws or to meet all the
requirements in § 441.530(a)(2)(v)
adding that for some individuals with
chronic mental illness or cognitive
impairment, this strict requirement may
exclude the least restrictive
environment in which they can reside.
The commenter indicated that CMS and
state Medicaid agencies can use the
other provisions in § 441.530 to insure
that settings in which residents receive
services are designed to facilitate the
actual integration of the individual in
the surrounding community without
prohibiting some residences that are
provider-owned or controlled from
providing residential support to
recipients.
Response: We have modified the
regulation to include language to
address situations in which state
landlord/tenant rules do not apply.
Comment: One commenter requested
clarification as to whether the provider
has to hold the space when the terms of
the lease are broken and there is no
payment of rent and suggested that CMS
use the typical landlord tenant
language.
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Response: It is beyond the scope of
this regulation to address issues such as
when the terms of a lease are broken or
rent is not paid. This regulation defers
to the state and local law, as applicable.
Absent applicable state or local law, the
regulation provides minimum
requirements that the state must make
sure are in place to inform individuals
of the eviction process and the process
to appeal the eviction.
Comment: One commenter noted that
if the provider cannot evict the
individual from provider controlled
housing all the other residents may
suffer and require new housing
arrangements. The commenter stated
that providers of services have
experience balancing the rights of
multiple residents and added that there
are circumstances when eviction is in
the best interest of all residents.
Response: This regulation is not
intended to override existing rules
governing adherence to proper eviction
procedures. This rule requires that
individuals receiving Medicaid HCBS
who are in provider owned or
controlled settings have the same or
comparable protections related to
evictions as individuals not receiving
Medicaid HCBS.
Comment: One commenter asked
about situations where the individual
decides to participate in an activity that
is contrary to the person-centered plan,
putting the individual in danger, and
asked who is liable for the outcome of
the risky behavior. The commenter also
wanted to know if, when all parties
have agreed to a plan and the individual
receiving supports departs from that to
which s/he has agreed, the provider has
standing to require the individual to
adhere to the plan and may take steps
to ensure compliance.
Response: We appreciate the
commenter’s questions. There is an
expectation that individuals and
providers will adhere to the services
and activities identified in the personcentered service plan. If individuals
place themselves or those around them
in danger, we expect the state and
provider to take the appropriate action
necessary to address the situation.
However, after the immediate crisis is
resolved, we would expect a
reassessment of needs to occur using the
person-centered service planning
process and an update to the personcentered service plan.
Comment: Many commenters
expressed concern that the application
of landlord/tenant law would create a
conflict with state licensing laws
governing assisted living providers or
other congregate settings, and indicated
that the state licensure laws protect
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individuals from arbitrary eviction and
define the circumstances in which a
provider may and may not discharge an
individual. The commenter added that
providers have an obligation to take all
reasonable steps to accommodate an
individual before seeking a discharge,
and recommended that CMS consider
the logistical and technical difficulties
in referring to state, county or city
landlord/tenant laws, as these vary
significantly and would subject
providers in different areas of the same
state to different standards depending
on where they are located. The
commenter indicated that it would be
burdensome for a state to create an
HCBS program that would take into
account all the variations when trying to
meet these requirements, and suggested
that providers that are not licensed
under an existing state licensing law be
required to only adhere to the state
landlord/tenant law, to create
uniformity and avoid the administrative
difficulties created by including county
and city laws. One commenter added
that the legal relationship between a
provider and a resident is very different
than that of a landlord tenant
relationship, as landlords typically do
not provide, nor are required by law to
provide, food, housekeeping or
assistance with ADLs pursuant to a
rental agreement. The commenters
recommend that in lieu of mandating
eviction protections under landlord
tenant laws, assisted living facility
resident protections be provided
through specific disclosure provisions
as part of the resident agreement and
approved by the applicable state
licensing authority. The commenter
added that such provision would
specify the terms and conditions for
move-in, including conditions for
discharge or transfer and an appeals
process for resolving disputes that are
non-emergency in nature.
Response: We are pleased to hear that
states have robust beneficiary
protections included in the licensing
requirements of certain settings. It is not
our intent to replace a state’s current
system. The intent of the language was
to assert the expectation that for a
setting to be considered home and
community-based, residents of providerowned or controlled residential settings
must have comparable protections
available to them as those provided
under the landlord tenant law of the
state, county, city or other designated
entity. As a result of the comments
received, we have added to this
requirement, for settings in which
landlord tenant laws do not apply, that
the state must ensure that a lease,
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residency agreement or other form of
written agreement is in place for each
participant and that such agreements
provide protections that address the
eviction processes and appeals
comparable to those provided under the
jurisdiction’s landlord tenant law.
Comment: One commenter believes
the § 441.530 (a)(1)(vi)(A) should be
revised to permit discharge when an
individual’s condition changes and care
needs can no longer be met under the
license of the dwelling they occupy
adding that there is nothing in the
regulation that abolishes the Keys
amendment requirements for SSI
recipients or HCB waiver recipients.
Response: While we understand that
there may be circumstances in which an
individual’s needs require a different
level of service, we expect that the
assessment of functional need, the
person-centered plan and the
availability of HCBS will be able to
address an individual’s changing needs.
If it is determined that eviction or an
involuntary discharge is necessary, the
state must ensure that proper
procedures for such actions are followed
and individuals are fully informed of
their rights.
Comment: One commenter wanted to
know if it is the responsibility of the
provider to assist the individual in
finding other housing, services, and
supports.
Response: The state is responsible for
addressing this assistance through the
person-centered planning process.
Comment: One commenter
recommends the regulation require that
states and providers delineate (a) the
conditions under which an individual
may be involuntarily moved from a
setting he or she prefers, and (b) the
methods by which the individual will
be informed of such conditions at the
time the individual chooses the setting.
Response: The regulation has been
modified to provide that, in
circumstances where tenant landlord
tenant laws do not apply, a lease,
residency agreement or other form of
written agreement must be in place that
provides protections that address
eviction processes and appeals
comparable to those provided under the
jurisdiction’s landlord tenant law.
Under circumstances where tenant
landlord rules do apply, the state will
ensure compliance with those rules.
Comment: One commenter indicated
that their state requires a contract
between the residents and providers and
wanted to know if it could be used in
lieu of a lease.
Response: It is possible that this
arrangement would comply with the
revised language allowing other forms of
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written agreements to implement
protections that are at least minimally
comparable to the protection provided
under the jurisdiction’s landlord tenant
law. A final determination of whether
such contracts comply with the
regulatory requirements will be made
through the state plan amendment or
waiver review process.
Comment: One commenter indicated
that current requirements in their State
allow for adequate service planning and
transition (30-day notice) when a
provider is unable to meet the needs of
an individual, and the State suggested
that the proposed rule reflect a similar
requirement.
Response: We believe it is a good
protection to include, however, we do
not propose to amend the regulation to
require a specific timeframe. We would
like the state to retain flexibility in
establishing timeframes.
Comment: Two commenters indicated
that in their state, the assisted living
model separates the assisted living
services from housing. The commenters
noted that providers of assisted living
services are licensed and the services
must be provided in a ‘‘Managed
residential community’’ consisting of
individual apartments where residents
can continue to live and maintain
personal autonomy. The commenters
added that residents are considered
tenants and are protected under the
state’s landlord tenant laws and that
under this arrangement the assisted
living services provided within the
managed residential community are
regulated by state licensure laws. The
commenters requested that the rule
recognize laws and state licensure laws
and regulations that govern the
provision of HCBS in their state.
Response: We believe the regulation
allows for this.
Comment: Many commenters
requested further clarification of the
‘‘specific physical place’’ language. In
general, the commenters support the
idea that individuals in congregate
settings should have agreements for a
specific room or unit and should not be
arbitrarily moved around by providers.
However, the commenters note that
landlord tenant laws vary tremendously
by state and their application to specific
residential arrangements tends to be fact
specific and subject to complex
statutory and judicial interpretation.
The commenters also note that the
federal Fair Housing Act prohibits
discrimination in almost all housing
activities based on disability and
requires housing providers to make
reasonable accommodations to rules and
policies when such accommodations are
needed for the individual to use and
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enjoy the housing. The application of
the fair housing laws to residential
settings that are also subject to state
licensure and regulatory schemes can be
complex, and the law in this area is
continuing to develop. Additionally the
state’s ‘‘level of care’’ licensure
standards that require the discharge of
residents with certain types or acuity of
conditions are at odds with civil rights
protections designed to allow
consumers to live and receive services
in places they choose. Providers are not
required to make accommodations
where to do so would result in an undue
financial and administrative burden or
would fundamentally alter the nature of
the provider’s operations. However,
providers and state licensing agencies
are required to make reasonable
accommodations to enable people to
remain in the homes that they choose if
the accommodations meet those tests.
The commenters suggest that state plan
amendments and waiver applications
should specify processes by which they
would make ‘‘reasonable
accommodations’’ decisions without
forcing residents to make claims in
court or forcing providers to jeopardize
their licensure by reasonably
accommodating residents whose service
needs have intensified, for example.
Reasonable accommodations processes
should provide plenty of notice and be
easily used. A number of states have
enacted interactive processes to provide
appeals and individual determinations
of the ability to remain, even if their
continued residency represents a
violation of the level of care
requirements. Finally, a legally
enforceable agreement under this
subsection should include a right to
appeal decisions affecting tenancy.
Agreements should clearly specify the
conditions that would trigger a
termination, including conditions
related to the person’s health status or
level of disability that would necessitate
a move. The individual should have the
right to appeal termination decisions to
an objective third party in a timely
manner, such as 30 days, which should
be defined in the state’s waiver
application. This appeals process
should be accompanied by the
reasonable accommodation process
noted above. Other commenter’s
recommended that if a state’s licensing
standards do not include such
protections, then the landlord tenant
statutes should be the default law.
Several commenters recommended the
following language: ‘‘An individual has,
under state licensing law, protections
from evictions. If these protections are
not provided, the individual shall have,
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at a minimum, the same responsibilities
and protections from eviction that
tenants have under the landlord/tenant
law of the state, country, city or other
designated entity.’’
Response: We appreciate the
commenter’s thoughtful comments
highlighting the complexities of
applying tenant landlord rules to
settings that normally do not have such
an application. The regulation has been
modified to specify that in
circumstances where landlord tenant
laws do not apply, a lease, residency
agreement or other form of written
agreement must be in place that
provides at least comparable protections
to those provided under the
jurisdiction’s landlord tenant law. At a
minimum, these agreements must
address eviction processes and appeals.
Under circumstances where tenant
landlord rules do apply, the state will
ensure compliance with those rules. We
are not amending the regulation to
include specific language referencing
state licensing laws. Rather we have
amended the language to add ‘‘For
settings in which landlord tenant laws
do not apply, the State must ensure that
a lease, residency agreement or other
form of written agreement will be in
place for each HCBS participant and
that the document provides protections
that address eviction processes and
appeals comparable to those provided
under the jurisdiction’s landlord tenant
law.’’
Comment: One commenter
recommended replacing the proposed
language ‘‘the individual has, at a
minimum, the same responsibilities and
protections from eviction that tenants
have under the landlord tenant law of
the state, county, city or other
designated entity’’ with the following:
(A)Individual has a lease, residency
agreement or other form of written agreement
that includes the ability to appeal move-out
decisions to an objective third-party.
Reasonable accommodations are made both
by the provider and the state to accommodate
aging in place. An appeal of a move-out
decision should not prevent the move-out
when there is a significant risk of harm to the
resident, other residents, or staff. The appeal
process will include nonpayment of fees
unless the state has a demonstrated
alternative process for addressing payment
disputes. All appeals should be pursued
expeditiously and should not take longer
than 30 days.
Response: We appreciate the
commenter’s recommendation, however
we do not believe it is appropriate to
include as a requirement. We note that
the suggested language represents some
good practice, and would encourage
states to include such protections in
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their policy and procedures if they do
not already exist.
Comment: One commenter
recommended the following changes to
the proposed language: ‘‘The unit or
room is a specific physical place that, if
a ‘family care home’, includes a private
bedroom, and if not a ‘family care
home’, includes, at a minimum, its own
kitchen facilities, sleeping area, and
private bathroom with toilet, sink and
shower or bathtub, that can be owned,
rented or occupied . . .’’
Response: We appreciate the
commenter’s suggestions, however, we
will not revise the rule to include these
types of specifications as they would be
overly prescriptive.
Comment: One commenter requested
that we revise the regulation to specify
that the unit can be owned, rented or
occupied under another legally
enforceable agreement by the individual
receiving services ‘‘or his/her chosen
surrogate, who must not be an agent of
the service provider,’’ could be inserted.
Response: We do not believe the
commenter’s recommendation to add
language regarding a surrogate is
necessary. The HCBS regulations
already address this in the definition of
individual’s representative.
Comment: Several commenters
supported giving individuals who
receive HCBS in provider-owned or
operated residential settings protections
under landlord tenant law, and
suggested adding protections afforded
by the ADA to this section to ensure that
individuals living in these settings
whose health needs change are afforded
appropriate accommodations (such as
increased staff), in order to continue
living in the setting.
Response: While we do not
administer or enforce the ADA, we note
that Medicaid regulations prohibit
discrimination in State Medicaid
programs (§ 430.2, § 435.901, § 435.905,
and § 435.908). As these regulations
apply in determining eligibility and
administering the Medicaid program
generally, it is not necessary to amend
this regulation on this subject.
Comment: A few commenters
recommended the word ‘‘unit’’ be
replaced with ‘‘room’’ throughout the
document.
Response: We do not agree with the
recommendation to remove the term
unit, but to provide additional
clarification, we have revised the
language to add the term ‘‘dwelling’’
since this is the common term used
under prevailing state and local
landlord/tenant laws.
Comment: Several commenters agreed
with the list of requirements for
provider owned and controlled
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residential settings. One commenter
added that preservation of the right to
privacy, including having a lockable
unit and the ability to control access to
the unit, and self-control of the
participant’s schedule, are also
important indicators for basic human
dignity. Another commenter noted that
individuals with disabilities should be
afforded the same rights as anyone else
in the country.
Response: We agree and appreciate
the commenter’s support.
Comment: One commenter indicated
that ‘‘the freedom to furnish and
decorate their sleeping or living unit’’
could use clarification noting that there
are many landlords that have
restrictions on water beds, or
permission prior to painting. The
commenter added that all rules relating
to entrance locks, roommates, furniture
preferences, daily schedules, food,
visitors, etc., must include caveats as to
feasibility and reasonableness.
Response: These requirements pertain
to settings that are owned or controlled
by a provider. Landlord tenant laws may
allow landlords to set reasonable limits
as long as the limits are not
discriminatory or otherwise deny rights
granted to tenants under the state law.
Therefore, we have added additional
language to this requirement to clarify
that, in a provider-owned or controlled
setting, the individual’s freedom to
furnish and decorate sleeping or living
units may contain limits within the
scope of the lease or agreement.
Comment: One commenter expressed
support of the criteria when an
individual lives alone, but wanted to
know in situations where an individual
chooses to live with a roommate who is
responsible for collaborating schedules
and ensuring that one person’s right to
have visitors does not infringe on the
privacy of the other.
Response: While this is not
specifically addressed through
regulation, we note that there are many
ways to address this concern, including
through good roommate
communication.
Comment: Several commenters
recommended that ‘‘their’’ be changed
to ‘‘the,’’ since ‘‘individual’’ is singular
but ‘‘their’’ is plural.
Response: We agree with the
commenter and have revised the
regulation accordingly.
Comment: One commenter noted that
individuals requiring care and services
will have their privacy limited in some
fashion while those care and services
are being provided and suggested the
following revision to § 441.530 and
§ 441.656(a)(1)(vi)(B): Each individual
has privacy in their sleeping or living
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unit, to the extent care and services are
provided in accordance with the
individual’s assessed needs.
Response: We do not believe the
recommended revision is necessary as
there is a general requirement that
services are provided in accordance
with an individual’s assessed needs.
This requirement is expressed at
§ 441.530(a)(1) and § 441.710(a)(1) and
also under person-centered planning
provision of the regulations for sections
1915(c), 1915(i) and 1915(k) of the Act.
Comment: A few commenters
disagreed with the proposed language
requiring that units have lockable doors.
The commenters believe that this
requirement poses a safety risk in the
event of an emergency and added that
clarification is also needed on a unit
owned by the resident who may not
want to provide the appropriate staff
with keys to his/her door. The
commenters pointed out that in some
apartment buildings the entrance door is
the unit’s door and asked if the resident
owns the unit whether he/she will be
required to provide appropriate staff
with keys.
Response: We disagree that the
recommended change is necessary.
However, the requirement for a lockable
entrance door may be modified if
supported by a specific assessed need
and justified and agreed to in the
person-centered service plan.
Additionally, the state must ensure
adherence to requirements set forth at
§ 441.530(a)(1)(vi)(F) and
§ 441.710(a)(1)(vi)(F).
We would like to clarify that this
regulation does not require individuals
to provide keys to anyone. The language
is meant to curtail the issuing of
resident keys to all employees or staff
regardless of the employee’s
responsibilities, thus granting
employees unlimited access to an
individual’s room. This provision
indicates that only appropriate
individuals should have access to an
individual’s room. For example, it may
be appropriate for the property manager
to have keys, but it might not be
appropriate for the individual working
at a reception area.
Comment: One commenter
recommended the additional phrase ‘‘if
necessary’’ be added after ‘‘appropriate
staff,’’ as there may be occasions when
the particular setting will not have staff
members holding keys to living units.
Several commenters recommend adding
the phrase ‘‘as appropriate’’ at the end
of the provision since there may be
times when a setting will not have staff
members with keys to living units.
Response: We agree with the second
commenter’s concern and have
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modified the regulatory language
accordingly to indicate ‘‘as needed.’’
Comment: Other commenters advised
that they support lockable entrance
doors with appropriate staff having keys
to doors, since there are also provisions
under the individual modification of
requirements discussed below that can
be used for individuals with cognitive
impairments for whom lockable doors
and free egress may present safety and
other issues. In such cases, alternative
means for assuring meaningful
individual privacy should be required
(for example, knocking and waiting for
a reply before entering a person’s
private space, respecting private
possessions, etc.).
Response: We appreciate the
commenter’s support.
Comment: Two commenters
expressed concern that the regulation
does not specify a process to determine
which staff will have keys, or that the
individuals themselves must have keys.
One of the commenters is aware of
instances where people have been
denied key access to their own homes
without appropriate justification. The
commenter recommended that CMS add
language to require that (1) the staff that
will have keys are included/identified
in the person-centered service plan and
chosen by the individual and (2) the
individual must also have a key to the
door. The commenter recommended the
following language: ‘‘Staff holding keys
will be named in the person-centered
service plan and individuals must have
keys to their own units’’ to
§ 441.530(1)(vi)(B)(1),
§ 441.656(1)(vi)(B)(1), and
§ 441.665(b)(3) for clarity across the
regulations.
Response: We do not agree that the
regulation should require that the
person who has keys should be
identified in the person centered plan,
but we do agree that the individuals
should have a say and agree with who
that person is. We agree with the
recommendation that individuals have
keys to their door, and have clarified the
language in the appropriate sections of
the regulation so that this is
unambiguous. As noted above, an
individual’s use of the room key may be
modified if supported by a specific
assessed need and justified and agreed
to in the person-centered service plan.
Comment: One of the commenters
requested that CMS clarify whether the
proposed rule requires the homes to be
locked or the bedroom doors to be
locked.
Response: We would like to clarify
that the individual must be able to lock
the door to their unit or dwelling, that
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the individual has a key to the door, and
that only appropriate staff have keys.
Comment: Several commenters
offered support of the requirement that
individuals share units only at the
individual’s choice. One commenter
does not believe that sharing units is
faithful to the principles of HCBS. We
also received comments opposing the
requirement or requesting further
clarification of the intent of the
requirement. Several commenters
believe this provision is inappropriate
and recommended that the private
room/living space requirement be
deleted completely. Commenters noted
that Medicaid does not cover room and
board costs so they believe that the term
‘‘choice’’ could be misleading, as the
determining factor for choosing double
occupancy versus a single-occupancy
unit may be whether a resident can
afford to. Many individuals are not
financially able to afford a private room
in settings such as assisted living
facilities. One commenter expressed
concern that, as proposed, allowing
individuals to choose to share units
without also requiring states to provide
(financially needy) individuals with
adequate funding, such as increasing the
maintenance needs allowance, will
force those individuals into nursing
facility settings. One commenter added
that ‘‘individual choice’’ should be
reflective of an individual’s resources
and care needs. Another commenter
believes that since beneficiaries
typically pay for room and board out of
their SSI benefit the proposed language
would effectively exclude assisted
living as an option for Medicaid
individuals in many states since
providers cannot afford to offer private
rooms at the rate Medicaid beneficiaries
pay. A few commenters added that
sharing living units may be necessary to
ensure a range of housing options the
HCBS waiver program and at the same
time manage resources to meet the costneutrality standard under the section
1915(c) of the Act waiver program. A
few commenters interpreted the
regulation to require separate bedrooms
for all individuals receiving residential
services unless the individual requests
otherwise and stated that this
requirement will result in a huge
unfunded mandate that will double the
cost of residential group home care.
Commenters suggested the following
regulatory changes related to this
provision:
• Revise the rule to say ‘‘Individuals
in shared rooms will have a choice of
roommate.’’
• Revise the rule to say ‘‘Individual
roommate preferences are
accommodated to the maximum extent
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practical and documented in the
individual’s person-centered service
plan.’’
• Revise the rule to add a requirement
that individuals should not have to
share a unit unless it is with a spouse,
partner, or other family member.
• One commenter recommended that
sharing a bedroom is clearly
documented as the choice of the
individual and that the room is shared
only with a person of the individual’s
choosing.
• One commenter suggested that the
rule needs to make it clear that a
resident’s choice acknowledges his
economic situation.
• Other commenters noted that if the
requirement is finalized, CMS needs to
add an exception to the requirement for
residential settings that do not meet the
private room/living space requirement
but are appropriate to meet the waiver
client’s needs and preferences according
to the individual, the client’s designated
representative and the case manager.
• Revise the rule to say ’’ Individuals
with disabilities receiving HCBS share
units with other individuals with
disabilities receiving HCBS, whether the
unit is a single bedroom or a multi-room
living space, only at the choice of the
individual with disabilities receiving
HCBS, at all times and under all
circumstances. Individuals with
disabilities receiving HCBS may share
such units with a person who is present
to provide services to the individual if
necessary for safety reasons, if
appropriately justified and
documented.’’
Response: We understand the
concerns raised by the commenters. We
have clarified that we are not requiring
that every individual receiving HCBS
have their own bedroom when receiving
residential services. The rule is
requiring that individuals be provided
options of residential settings, including
an option of a private room. This rule
does not require every provider to have
a private room option. Instead it
requires the State to ensure that there
are private room options available
within a state’s HCBS program. We
agree with the commenters that the
financial resources available to an
individual may impact the options
available to a particular individual and
we have changed the regulatory text to
make that clear. We also agree with the
commenters that if an individual
chooses to share a room, that individual
also must have a choice of their
roommate. We have changed the
regulatory text to clarify this. We plan
to address these issues further through
future guidance.
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Comment: One commenter indicated
that in their assisted living facility, all
residents have a private room but share
a 1⁄2 bath with the private room next
door and believes that under the
proposed regulation a resident in this
kind of situation would never find the
appropriate bath mate because the rule
would require that they have their own
1⁄2 bath and the commenter believes this
was not CMS’ intent.
Response: We believe that the
arrangement described by the
commenter, that one bathroom is shared
between two private rooms, will meet
the requirement at
§ 441.530(a)(1)(vi)(B)(2) and
§ 441.710(a)(1)(vi)(B)(2) that individuals
share units only at the individual’s
choice.
Comment: One commenter
recommended that CMS form a work
group of stakeholders to determine a
method for ensuring that Medicaid
waiver applications and renewals
demonstrate how the state assisted
living program ensures adequate
reimbursement for private room
occupancy (that is, the state assisted
living program does not restrict room
and board payments to less than the cost
of providing a private room and
provides housing assistance as
required).
Response: States are required to
provide opportunities for public input
in the development of Medicaid service
rate methodologies. During the SPA
review process, we ensure that the state
has met this requirement and that the
state’s proposed reimbursement
methodologies comport with
requirements at section 1902(a) of the
Act. These include safeguards against
unnecessary utilization of services,
assurance that payments are consistent
with efficiency, economy, and quality of
care, and that payments are sufficient to
enlist enough providers so that care and
services are available under the plan at
least to the extent that such services are
available to the general population in
the geographic area.
Comment: One commenter suggested
that the requirement that individuals
have privacy in their sleeping or living
unit should not be waived by the
provider/state.
Response: We agree that an
individual’s privacy should always be
respected. Where any modification of
this condition occurs, we have included
protections in the rule to ensure the
individual’s rights are respected.
Comment: Several commenters
strongly urged CMS to require that a
bathroom be in the unit for all settings
with a capacity of six or more residents
as the commenters believe that having
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one’s own bathroom is a fundamental
characteristic of living in one’s own
home. The commenters noted that CMS
proposed a similar requirement last
year, and believes that such a
requirement is no less important today
and added that it would be difficult to
consider a setting ‘‘community-based’’
if, for example, a building housed 10 or
20 residents who shared a bathroom or
bathrooms located off a main hallway,
and a resident at 2 a.m. had to walk
down the facility hallway in order to
use the bathroom. The commenters
recommended the following provision
be added to the requirements at (B):
Units include at least one full bathroom
(unless the setting is in a building with
a capacity of six or fewer residents).
Response: We understand the
commenters’ concern; however, the
standard for how many bathrooms a
dwelling must have is governed by
building code, and is beyond the scope
of this regulation.
Comment: One commenter expressed
the opinion that the bathroom is the
most private part of their home, and
inability to control functions performed
in that room is a major source of feelings
of loss of dignity and personal
autonomy among people with
disabilities. As such, the commenter
believes that privacy in the bathroom
should be maximized and assistance
should be provided only when actually
needed, limited to specific tasks and
carried out one-on-one with the
bathroom door closed.
Response: We agree with the
commenter and believe that an
individual’s privacy should be
respected in all activities of an
individual’s life.
Comment: Several commenters
expressed strong support and
appreciation for the inclusion of this
provision and two noted that the
inability to decorate or furnish a living
unit would be a clear indicator of an
institutional model.
Response: We appreciate the
commenters’ support.
Comment: A few commenters
supported the proposed rule as written.
Response: We appreciate the
commenter’s support.
Comment: One commenter supports
the regulation, but believes the rule
should go further and require living
units to have access to food storage and
preparation space (with the caveat that
stoves or microwaves could be removed
if the assessment documented that it
would be a danger because of the
resident’s cognitive impairment).
Response: We agree with the
commenter and believe that this is
reflected in this regulatory language.
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Comment: Several commenters
generally supported the proposal that
individuals have the freedom and
support to control their schedules and
activities, but recommended that the
word ‘‘control’’ be changed to ‘‘choose’’
noting that choice is a foundational
element of HCBS and merely allowing
individuals to control schedules and
activities is inadequate. According to
commenters, supporting an individual
and providing the support necessary to
participate in activities (for example, the
transportation to attend a selected
activity) allows for full community
living.
Response: We believe that it is
fundamental for individuals to have the
control to make their own choices.
Therefore, we do not believe it is
necessary to change the word control.
Comment: While commenters agreed
with the principle that a resident should
be able to eat, socialize and come and
go freely, several commenters expressed
concern with the proposed language and
suggested that (a)(1)(vi)(C) should not
focus on ‘‘access’’ but rather on the
individual’s choice to select the foods
they eat, to store food in their rooms, to
bring back food from the facility’s
kitchen and to reschedule meal times.
The commenters pointed out that
because HCBS facilities most likely
schedule meals at specific times, as
required by regulation, a resident may
not have access to all food in the
building all the time, and a residential
setting cannot reasonably accommodate
each individual’s preference on a 24hour a day basis. One commenter
requested clarification as to whether or
not the proposed ‘‘access’’ requirement
would result in a housing arrangement
that includes a daily activity (such as
meals) at pre-arranged time not being
considered a home and communitybased setting. A few commenters
requested that the final regulation be
stronger in its intent to ensure
meaningful choice and provide for
activities that will support integration
with the community. The commenters
noted that as written the language could
be easily interpreted to maintain
institution-like settings instead of true
community living. The commenters are
concerned about situations in which
individual choice is not meaningful, for
example, an individual being given
access to food by having the choice of
a snack bar or a pitcher of water and
crackers.
Response: We disagree with the
commenters’ belief that a residential
setting cannot reasonably accommodate
an individual’s preference on a 24-hour
a day basis. The opportunity for
individuals to select the foods they eat,
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store food in their room, eat in their
room, and decide when to eat are all
ways in which the access to food
requirement can be met. Under this
provision, giving an individual the
choice of a snack bar or a pitcher of
water and crackers does not meet the
access to food requirement. An
individual should not be presented with
narrow options, decided by someone
else, without input from the individual.
Comment: One commenter believes
the term ‘‘food’’ can be interpreted
broadly and could lead participants to
believe that there must be 24/7 access to
full service dining. The commenter
recommended that in order to eliminate
the range in interpretation, CMS replace
the word ‘‘food’’ with ‘‘snacks.’’
Response: We disagree with the
recommended change. We expect that
the individual will have access to food.
This requirement does not pertain to
full dining services or to meal
preparation, only access to food.
Comment: One commenter cautioned
that the freedom and support of access
to food at any time needs to be carefully
monitored and offered the example that
unrestricted access to food may be
unrealistic for individuals with eating
disorders or brain injury.
Response: Modification to this
requirement may occur as long as it is
done in compliance with
§ 441.530(a)(1)(vi)(F) and § 441.710
(a)(1)(vi)(F).
Comment: One commenter noted that
freedom to control schedules and
activities with support to do so is a
different issue from ‘‘access to food at
any time’’ and requested if CMS
intended the support to be available for
food related activities as well?
Response: It is unclear what the
commenter means by ‘‘food related
activities.’’
Comment: One commenter believes
that the requirement that individuals
have ‘‘freedom to control schedules and
activities with support to do so’’ should
not be permitted to be changed by the
provider/state. The commenter explains
that this is a particularly important
point because many residential facilities
have policies and procedures that say
that residents have freedom to choose
and participate in preferred activities,
but as a matter of actual fact, the
facilities do not provide the necessary
support to make such freedom a reality.
The commenter suggests that this
subsection may be an appropriate place
to state that ‘‘a person’s ability to
receive any service from any provider
described in his/her person-centered
plan will not be infringed upon by any
provider for any reason.’’
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Response: We agree that a person’s
ability to receive services identified in
the person-centered service plan should
not be infringed upon by any provider
for any reason. We believe that
preventing an individual from receiving
any service identified in the personcentered service plan is a direct
violation of the person-centered plan
requirements and the home and
community based setting requirements
specified in this regulation.
Additionally, any setting not adhering
to the regulatory requirements will not
be considered home and communitybased. The supports necessary to
achieve an individual’s goals must be
reflected in the person-centered service
plan as required under § 441.725(b)(5).
Comment: One commenter suggested
that, to modify the condition pertaining
to individuals having visitors of their
choosing at any time, provider
documentation should be required for a
safety need to restrict access to a
person’s desired visitors, the names of
specific visitors whose access will be
controlled, how access will be
controlled, along with a description of
the specific independently-verifiable
threats of real harm that uncontrolled
access by those visitors represent to the
person. The commenter suggested that
the plan should allow visits even by
people on this controlled-access list if
they can be conducted safely by
providing a monitor or other means.
Response: We appreciate the
commenter’s general support. The
regulation has been modified at
§ 441.530(a)(1)(vi)(F) and
§ 441.710(a)(1)(vi)(F) to specify the
requirements that must be met to
modify the condition pertaining to
individuals having visitors of their
choosing at any time.
Comment: One commenter expressed
concerns that some assisted living
settings may have policies about
visitation and that as a result they
would be automatically eliminated from
being considered community-based
settings.
Response: Settings that do not comply
with the requirements of this regulation
will not be considered home and
community-based settings.
Comment: Several commenters
supported individuals’ rights to have
visitors of their choosing at any time;
however, the commenters noted that in
a provider-based setting this right
should be viewed in the context of
shared living arrangements. Several
commenters noted that the safety of
other residents and their ability for quiet
enjoyment of their living setting must be
considered and suggested that the rule
be revised to add language that allows
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for reasonable rules for safety and the
quiet enjoyment of the provider setting.
Response: We acknowledge that in
certain living situations the preferences
of others must also be respected. We
expect that there will need to be
communication and coordination
between all parties affected.
Comment: A few commenters voiced
concern that allowing some individuals
to have any visitors of their choosing at
any time in some cases could be a safety
issue. Another commenter added that it
is not reasonable that residents be
allowed to have visitors to the extent
that they can ‘‘visit’’ for extended and/
or indefinite periods of time, noting
under the proposed language, these
visitors could actually live in the HCB
setting.
Response: It would be reasonable for
there to be limitations on the amount of
time a visitor can stay as to avoid
occupancy issues. Such limitations
should be clearly stated in a lease,
residency agreement, or other form of
written agreement.
Comment: Several commenters
supported the proposed language in
general but one recommended that CMS
add ‘‘including overnight’’ to allow for
individuals to have visitors of their
choosing at any time as this is a right
that others have.
Response: We believe the language
adequately addresses this issue, and
allows for flexibility as appropriate.
Comment: Several commenters
recommended that the proposed
requirement on visitors have additional
language and protections, which would
allow for reasonable limitations on how
and where visits are conducted for
safety and the quiet enjoyment of the
provider setting for all residents. One
commenter suggested that the provision
be changed to read: ‘‘individuals are
able to have visitors of their choosing at
any time that is reasonably and
mutually agreeable with other members
of the household and consistent with
their support needs.’’ Two commenters
recommended adding the phrase
‘‘provided such visitors are not
disruptive to individuals in the
residential setting’’ to the end of the
proposed language. One commenter
recommended the rule be revised to say
‘‘if the building rules are established
and approved by the residents, they are
allowable and residents can receive
HCBS.’’ Another commenter believes
CMS should add a provision that the
provider can deny access of visitors if
there is a reasonable belief that the
visitor presents a danger.
Response: We believe the regulatory
language adequately addresses the
visitation requirement. We will take the
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commenters’ suggestions under
consideration as we develop further
guidance.
Comment: Several commenters
strongly supported this provision as
proposed and stressed that it is an
essential provision. These commenters
expressed concern that under current
standards, some assisted living settings
are not physically accessible and have
nonetheless received HCBS waiver
funding for setting services. One
commenter supported this requirement
and added that the modifications and
justifications for physical accessibility
are included in the service plan.
Response: We appreciate the
commenters’ support.
Comment: One commenter believes
that the proposed language is too vague
and noted that additional guidance is
essential, especially given the limited
availability of resources to upgrade
existing facilities and the varying
degrees of accessibility needed
depending on the nature of any
particular disability. Some commenters
noted that settings must be physically
accessible under the ADA and Section
504 of the Rehabilitation Act without
reference to any specific characteristics
of the individual and therefore,
indicated that this provision isn’t
necessary. A commenter indicated that
there are no possible legitimate safety
reasons for not providing a physically
accessible residential or program setting
to any person with a disability, and that
failure to do so may be a safety hazard.
These commenters advised that this
condition must not be modifiable for
any reason.
Response: We agree and revised the
regulations so that they do not include
§ 441.530(a)(1)(vi)(E) and
§ 441.710(a)(1)(vi)(E) as an additional
condition that can be modified.
Comment: Two commenters indicated
that to ensure the exclusion of
segregated settings and promotion of
integrated settings, CMS should revise
this provision to specify that a providerowned or controlled residential setting
should not only be ‘‘physically
accessible,’’ in terms of architecture for
persons with mobility disabilities, but
should also be accessible for persons
with sensory disabilities. This includes
ensuring effective communication
through the provision of auxiliary aids
and services, such as but not limited to
sign language interpreters, alternative
formats, and adapted equipment and
devices, such as smoke alarms and
telephones.
Response: We do not agree with
commenter’s suggestion to revise the
regulatory language. Items and services
that are needed by individuals to live in
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their homes and communities would
need to be identified through the
person-centered planning process and
some of those items and services may be
covered through a Medicaid service,
such as 1915(i) HCBS, State plan home
health or under a 1915(c) HCBS waiver.
Comment: One commenter supports
the list of excluded settings.
Response: We appreciate the
commenter’s support. The excluded
settings included in the regulation are
consistent with the settings excluded in
statute.
Comment: Many commenters noticed
the difference between
§ 441.530(a)(2)(iv) and
§ 441.656(a)(2)(iv). The commenters
wanted to know if the difference exists
because the 1915(i) statute refers to
‘‘hospital’’ as institutionalized care,
whereas 1915(k) does not. To the extent
possible, the commenter encouraged
CMS to be consistent across authorities
if it intends to clarify this difference.
Response: Whereas section
1915(k)(1)(A)(ii) of the Act expressly
prohibits a nursing facility, institution
for mental diseases, or an intermediate
care facility for the mentally retarded
from being considered home and
community based settings, the statute
did not include a hospital among the list
of excluded settings. In an effort to be
consistent with other authorities
providing HCBS, we proposed to
exclude hospitals providing long-term
care services from the definition of a
home and community setting for the
provision of the Community First
Choice Option. We believe that it would
be duplicative to provide CFC services,
such as assistance with activities of
daily living, in such settings.
Additionally, we believe this exclusion
aligns with section 1915(k)(1)(A)(ii) of
the Act requiring that services are
provided in a home and communitybased setting and section 1915(k)(3)(B)
of the Act requiring that services are
provided in the most integrated setting
appropriate to the individual’s needs.
However, we understand that
individuals will likely have a continued
need for certain types of assistance
while experiencing a short-term stay in
a general acute hospital setting. Under
such circumstances, most services
provided in a general acute care hospital
are not CFC services, but individuals
who have an assessed need for
assistance with IADLs may continue to
receive such services while an inpatient
in such a setting.
Comment: Many commenters
requested this section be revised to
exclude ‘‘a hospital’’ without the
proposed qualification that it must
provide long-term care services. One
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commenter also agreed with the
recommended revision and expressed
concern about duplication of services.
The commenter believes that allowing
an individual to receive IADL services
during a short-term stay in a general
acute hospital would be hard to
administer without increased costs to
the state. The commenters want the
language to be consistent with
§ 441.656(a)(2)(iv), which excludes any
section 1915(i) of the Act service from
being provided in a hospital.
Response: As with payment for any
Medicaid service, we expect states to
have processes in place to safeguard
against unnecessary utilization of such
care and services and prevent the
duplication of the payments of
Medicaid services. We understand that
individuals may have a continued need
for assistance with certain IADLs while
experiencing a short-term stay in
general acute hospital settings.
Therefore, while services provided in a
general acute care hospital are not CFC
services, individuals who have an
assessed need for assistance with IADLs
may continue to receive such services,
as long as those services do not
duplicate services provided by the
hospital setting while an inpatient in an
acute hospital setting.
Comment: A few commenters agreed
with the regulatory language stating that
individuals in an acute care hospital
who need assistance with IADLs, should
not be prevented from receiving such
services while they are in an acute
hospital setting. The commenters
further stated that the ability to receive
these services, as needed, while in the
hospital could enable a smoother
transition after hospital discharge back
to a home or community setting and
help prevent institutionalization.
Response: We appreciate the
commenters’ support, and will include
this provision into the final regulation.
Comment: Several commenters
requested the regulation be revised to
add ‘‘Board and Care homes’’ for people
with disabilities to the list of excluded
settings, because of the institutional
manner in which they operate.
Response: We do not believe it is
necessary to identify specific settings,
beyond what is specified in statute.
States define settings differently, and
the way board and care operates in one
state, may be very different from the
way board and care settings operate in
another state. Recognizing the lack of
national standard-setting definitions, we
believe defining the qualities that all
settings must exhibit to be considered
home and community-based is the best
way to apply a national standard. We
believe the most effective and consistent
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way to assure that individuals receiving
Medicaid HCBS, regardless of age or
type of disability, are offered HCBS in
the most integrated setting appropriate
to their needs and preferences, is to
focus on the qualities of ‘‘home’’ and
‘‘community’’ that assure independence
and integration from the perspective of
the individuals. We will provide
additional guidance to states to identify
any other setting that has the effect of
isolating individuals receiving Medicaid
HCBS from the broader community of
individuals not receiving Medicaid
HCBS.
Comment: In response to the request
in the preamble for comments on
whether there are settings in addition to
those currently enumerated that are, by
their nature, location, or administration
inherently non-community based,
several commenters suggested
§ 441.530(a)(2)(v) and § 441.710(a)(2)(v)
be revised to say ‘‘Any other locations
that have qualities of an institutional
setting, as determined by the Secretary.
The Secretary will apply a rebuttable
presumption that a setting is not a home
and community-based setting, and
engage in heightened scrutiny, for any
setting that is isolated from the larger
community, does not allow individuals
to choose whether or with whom they
share a room, limits individual’s
freedom of choice on daily living
experiences such as meals, visitors, and
activities or limits an individual’s
opportunity to pursue community
activities.’’ The commenters also stated
that if CMS does not make the
recommended revision, then the
regulations in § 441.530(a)(2)(v) and
§ 441.710(a)(2)(v) should specify that
such characteristics give rise to a
rebuttable presumption that the setting
is not home and community based.
Response: We appreciate the
commenters’ suggestions, however we
believe they are already addressed in
§ 441.530(a)(1) and § 441.710(a)(1).
Therefore we will not revise
§ 441.530(a)(2)(v) and § 441.710(a)(2)(v)
to include the commenters’ suggestions
as we believe it would be duplicative.
Comment: One commenter indicated
that it is difficult to imagine how
settings located on or adjacent to the
grounds of an institution could be
considered home and community based.
Another commenter further added that
the regulation should be revised to add
that the settings listed in
§ 441.530(a)(2)(v) to the list of excluded
settings.
Response: In response to the many
comments we received, we will not
amend the regulation to explicitly
prohibit settings listed in section
§ 441.530(a)(2)(v) from the definition of
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home and community-based. However,
such settings are presumed to be
institutional. States wishing to identify
such settings as home and communitybased may, during the SPA and waiver
submission and review process, provide
evidence as to how such settings are not
institutional in nature. We will
determine if the setting is not an
institution and meets the HCB setting
requirements.
Comment: One commenter requests
CMS reconsider its position with regard
to the provision of HCBS on ICFs/MR
campuses and planned residential
communities for people with
developmental disabilities.
Response: ICF/IIDs (formally known
as ICF/MRs) are statutorily prohibited
from being considered home and
community-based under the authorities
of sections 1915(c), (k) and (i) of the Act
and services provided on the campuses
of these facilities are presumed to not
have the qualities of HCBS under this
rule and subject to the heightened
scrutiny provision of this rule.
Comment: A few commenters
requested the rule clarify that the
exclusion is intended for residential
supports and not supported
employment or other vocational activity
that may find an individual choosing
competitive employment in a setting
that may be located in a building on the
grounds of, or immediately adjacent to
a public institution or disability-specific
housing complex.
Conversely, another commenter
expressed concern that people with
disabilities are being served in
segregated work and day settings that do
not meet the ‘‘most integrated setting’’
definition and do not comply with
guidance related to the ADA and the
Olmstead decision issued by the US
Department of Justice (DOJ).
Additionally, the commenter indicated
that DOJ has made it clear that the
ADA’s integration mandate includes day
and employment services, and that
unwarranted placement in segregated
day programs is a violation of this
mandate. Thus, this commenter
recommends that CMS consider
excluding segregated, congregate
facilities and programs from the
definition of HCBS. The commenter also
recommends specifying the following
settings are excluded (per DOJ
guidance): (1) Congregate day and
employment services populated
exclusively or primarily with
individuals with disabilities, (2)
Congregate day and employment
services settings characterized by
regimentation in daily activities, lack of
privacy or autonomy, policies limiting
visitors, or limits on individuals’ ability
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to engage freely in community activities
and to manage their own activities of
daily living; or (3) Day and employment
services settings that provide for
daytime activities primarily with other
individuals with disabilities. The
commenter recognizes that if these
recommendations are adopted, a
transition period is necessary to ensure
sufficient time for services to meet these
new requirements.
Response: CMS does not have the
general authority to enforce the ADA
independently of its oversight of the
Medicaid program. To the extent that
the services described are provided
under 1915(i) or 1915(k) (for example,
residential, day, or other), they must be
delivered in settings that meet the HCB
setting requirements as set forth in this
rule. We will provide further guidance
regarding applying the regulations to
non-residential HCBS settings. In
addition, since this authority provides
states the opportunity to provide
individuals HCBS and not institutional
services, individuals receiving 1915(i)
State plan HCBS or 1915(k) CFC
services must be living in settings that
comport with the HCB setting
requirements as set forth in this rule
regardless of whether they are receiving
HCBS in that residence. This is
consistent with CMS’ longstanding
policy regarding 1915(c) HCBS.
Comment: One commenter
recommends establishing a maximum
limit to the number of individuals living
in a provider-owned or controlled
residential setting.
Response: We do not believe there is
a maximum number beneath which we
could determine with certainty that the
setting would meet the requirements of
HCB settings. The focus should be on
the experience of the individual in the
setting. In addition, we respect a state’s
right to establish state laws to
implement such a requirement
regarding size. We intend to provide
additional guidance to states to identify
any other setting that has the effect of
isolating individuals receiving Medicaid
HCBS from the broader community of
individuals not receiving Medicaid
HCBS. We plan to include in the
guidance examples of specific settings
that will require heightened scrutiny
and may identify additional qualities,
including the size of the facility,
triggering such scrutiny. Our experience
through our work with other federal
Departments and current research
indicates that size can play an important
role in whether a setting has
institutional qualities and may not be
home and community-based.
Comment: One commenter added that
an approach focused on characteristics,
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rather than locations, provides a useful
framework to define home and
community-based settings, while
allowing consumers of long-term
services and supports choices regarding
the services and supports they receive
and from whom they receive them,
rather than limiting the person’s choices
arbitrarily. However, several other
commenters expressed opposition to
this language and requested that it be
removed completely. These commenters
stated that, if a provider-based setting
can meet all of the criteria in paragraph
(1), it should not matter where the
provider is located, and applying a
rebuttable presumption is redundant.
They also stated that the focus should
be on the autonomy of the individuals
receiving services. One from this group
of commenters stated that the
‘‘rebuttable presumption’’ could create a
standard that is difficult to meet and
imposes obstacles that are unnecessary
and unreasonable. This commenter also
stated that each setting regardless of
physical location should be evaluated in
accordance with the same quality
review criteria and that the rebuttable
presumption is not good public policy
and has the potential to be prejudicial.
Another commenter stated that the
focus should not be on the setting, but
rather on an individual’s choices and
the person-centered service plan, and
does not believe arbitrary geographic or
location-specific criteria are
appropriate. One expressed that this
requirement will hinder current
initiatives to rebalance state’s long term
care systems. Another expressed
concern with the effect this language
would have on settings financed by the
Department of Housing and Urban
Development (HUD) with millions of
dollars to develop group homes,
apartment complexes and other housing
for individuals with developmental
disabilities. Another stated that some
individuals make the choice to live in
disability-specific housing with
proximity to friends that rent from the
same provider, or that they choose
housing in a convenient location with
access to services such as
transportation.
Response: We appreciate the
comments provided about the
challenges of the term rebuttable
presumption. The proposed language
provided a list of settings that, from our
experience in approving and monitoring
HCB programs, typically exhibit
qualities of an institutional setting.
However, we recognize that state
innovations, creative and proactive
efforts to promote community
integration, and market changes could
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result in the settings being located in a
building that also provides inpatient
institutional treatment, or in a building
on the grounds of, or immediately
adjacent to a public institution, that in
some instances could be considered
home and community-based. In
response to public comments, we have
revised the regulatory language to say
‘‘Any setting that is located in a
building that is also a publicly or
privately operated facility that provides
inpatient institutional treatment, or in a
building on the grounds of, or
immediately adjacent to, a public
institution, or any other setting that has
the effect of isolating individuals
receiving Medicaid HCBS from the
broader community of individuals not
receiving Medicaid HCBS will be
presumed to be a setting that has the
qualities of an institution unless the
Secretary determines through
heightened scrutiny, based on
information presented by the state or
other parties, that the setting does not
have the qualities of an institution and
that the setting does have the qualities
of home and community-based
settings.’’ We believe the revised
language more clearly reflects the intent
of this provision.
Comment: One commenter expressed
concern with the ultimate discretion
granted the Secretary through this
regulation; the commenter categorizes it
as ‘‘authority with strings attached.’’
The presumption, coupled with the
requirement of heightened scrutiny for
certain proposals, makes it very difficult
for the Secretary to find in favor of
innovative partnerships that provide
immediate and consistent access to
necessary health care, peer
relationships, and legitimate
‘‘integration,’’ including HCBS homes
located on ICF/MR campuses and
planned residential communities.
Response: We do not agree with the
commenter. We believe the
requirements set forth in this regulation
will support innovative partnerships
that support community integration and
provide individuals with maximum
control.
Comment: One commenter
recommended the rule apply a
presumption of ‘‘community-based’’ if
an individual has lived in an assisted
living facility for at least 12 months and
is the only available alternative to the
institutional settings.
Response: We do not believe that the
amount of time spent in a setting should
be used to classify the setting as home
and community-based.
Comment: Several commenters stated
that while the concept of a rebuttable
presumption may be attractive in the
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abstract, the commenters doubt that it
can be operationalized effectively. The
commenters expressed concern that this
will be done as an individualized
determination falling under ‘‘we-knowit-when-when-we-see-it.’’ The
commenters stated that providers need
clear guidance ahead of time, before the
individual moves in and/or before the
provider develops property. A couple of
commenters expressed concern about
the lack of guidance regarding
rebuttable presumption and what would
constitute adequate rebuttal of the
presumption. One stated that the
proposed rule already creates a set of
requirements specific to providerowned and controlled residential
settings receiving HCBS funding, which
effectively create heightened scrutiny
for such settings. The commenter also
questioned what procedural safeguards
will be in place to allow appeals of
decisions, who will make the final
determinations, what are the additional
administrative burdens placed on states
and providers to add this additional
layer of heightened scrutiny, and if a
setting meets an individual’s needs and
preferences and meets the other criteria
for home and community-based settings,
who should bear the burden of proof to
demonstrate that a setting is not home
and community-based. Some
commenters believe that the settings to
which the rebuttable presumption will
apply should be explicitly excluded
rather than subjected to ‘‘heightened
scrutiny.’’
Response: The regulation has been
revised to make it clear that states
wishing to present evidence that such
settings are home and community-based
may do so. Under such circumstances,
we will engage in heightened scrutiny
in the course of the review of a SPA
and/or the state’s transition plan of
supporting documentation of this
evidence to make a determination that
the settings do comply with the
requirements set forth in § 441.530 and
§ 441.710. This review will also include
assessment of how the settings allow for
full integration into the broader
community. In addition to information
provided from the state, we also will
accept information from stakeholders
and other third parties regarding
whether such settings have the qualities
of being home and community-based
and do not have the qualities of an
institution. We stress, however, that
lacking strong evidence to the contrary,
we will presume the settings are not
HCB.
Comment: One commenter indicated
disagreement with the application of a
rebuttable presumption. Specifically,
the commenter does not agree with
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housing arrangements that encourage
spouses and family members to tie their
own housing to the institutional
housing of the family member who
requires the most care, rather than
encouraging the development of
innovative solutions for how
individuals with various chronic and
high care needs may be housed in the
most integrated settings. The commenter
also indicated that while it is tempting
to cleanly differentiate between the
needs and wishes of senior constituents
and the disability community regarding
this regulation, it does not take into
account the increasing numbers of
people with disabilities who are aging,
who must be assured that they will not
have any weaker protections around
gaining access to services and supports
in a truly integrated community setting.
Response: We appreciate the
commenter’s opinion. We believe our
HCB setting requirements are beneficial
to everyone regardless of age, condition
or level of disability.
Comment: Several commenters
suggest that rather than creating a
rebuttable presumption, CMS should
state that the settings listed in
§ 441.530(a)(2)(v) and § 441.710(a)(2)(v)
are not home and community-based
even if these settings meet the
requirements in paragraph
§ 441.530(a)(1) and § 441.710(a)(1). The
commenters urged that one of the most
important qualities of a home and
community-based setting is its location;
a setting that is literally on the grounds
of, in, or synonymous with an
institution cannot be home and
community-based.
Response: We appreciate the
commenter’s perspective. Such settings
are presumed to be institutional and not
home and community-based. However,
we recognize that it could be possible
for some of these settings to operate in
a manner that is consistent with the
HCB requirements set forth in this rule.
Therefore, we will engage in a formal
review of such settings if the state
would like to recognize them as home
and community-based settings under
the applicable Medicaid authorities.
Comment: One commenter suggests
that if we retain the heightened scrutiny
of settings described in this section,
then we should modify the regulation to
include an exception from the
requirement if the client, the client’s
designated representative and client’s
case manager believe it is in the client’s
best interest to be allowed to live in
such a setting.
Response: We believe that individuals
must have the opportunity to receive
services under 1915(i) in settings that
support integration with the greater
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community. Therefore, State plan HCBS
must be delivered in a setting that meets
the HCB setting requirements as set
forth in this rule and since this
authority provides states the
opportunity to provide individuals
HCBS and not institutional services,
individuals must be living in settings
that comport with the HCB setting
requirements as set forth in this rule.
For settings that do not meet these
requirements, we note that there may be
other Medicaid authorities under which
such services may be covered.
Comment: One commenter expressed
concern that the presumptive
ineligibility of certain congregate
settings and disability specific housing
may have a chilling effect on the
development of innovative service
delivery approaches designed to meet
the preferences of and provide a wider
array of options to people with limited
income and resources. For example, the
commenter notes that continuing care
retirement communities (CCRCs) and
dementia-specific assisted living have
been important options for older
persons who want to plan for a future
in which increased disability is likely.
But most of such settings and services
are very expensive—well out of the
reach of people who are likely to need
Medicaid assistance. In response, some
innovative providers of subsidized
housing are co-locating assisted living
settings on the same location or
converting parts of their buildings to
assisted living. If such approaches
would mean that these settings were
presumptively ineligible to participate
in Medicaid HCBS programs, it could
have a chilling effect on developing
such innovations—effectively restricting
them to those consumers who have
substantial resources. One potential
solution would be to recognize what the
Fair Housing Amendments Act of 1988
has recognized in civil rights law—
namely that ‘‘housing for older persons’’
is desired by a substantial number of
people age 55 and older and that it is
not considered discriminatory. It is
relevant to recall that assisted living and
CCRCs emerged largely as private pay
options, reflecting strong consumer
demand for age-specific housing with
services that enable older people to live
more independently than they would in
a nursing home. This history stands in
contrast to state mental hospitals or
institutions for those with intellectual or
developmental disabilities, where state
policies created segregated
environments for people with such
disabilities. The history of age-specific
housing with service approaches also
contrasts with the history of nursing
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homes, which grew dramatically after
the enactment of Medicaid with its
institutional funding bias. In correcting
the history of state and federal actions
that have segregated people with
disabilities, CMS should not prevent the
ability of older persons with low
incomes to access innovative
approaches to housing and services that
have demonstrated strong consumer
demand and are permissible under civil
rights law.
Response: It is not our intent to
hinder innovative ideas for future
development of HCBS. Rather, we
believe that the requirements set forth in
this regulation are a result of many
comments we received from
stakeholders, including individuals
receiving services. Thus, we believe that
developers and states should use this as
a foundation as they look at developing
plans to provide long-term care services
and supports in their communities. We
believe that this could be a tool to assist
states with adhering to the Olmstead
mandate and the requirements of ADA.
Comment: The commenters also
requested that CMS clarify that it did
not intend to include such group homes
located in and fully integrated into
typical neighborhoods or small
community ICF/MR homes in the
definition of a ‘‘facility that provides
inpatient institutional treatment.’’
Response: It is possible that the
setting described by the commenter
could be considered a home and
community-based setting, if it meets the
requirements set forth at § 441.530 and
§ 441.710. ICF/IIDs regardless of size are
statutorily prohibited from being
considered a home and communitybased setting, because they are
institutions under the statute.
Comment: Several commenters
indicated that a setting should not be
disqualified based solely on physical
proximity to an institution. One
commenter expressed concern this
provision could force people into
nursing homes as the only financially
viable option. Providers have been
encouraged to diversify and move into
HCBS, including converting portions of
what would be considered
‘‘institutional’’ settings to assisted living
or other type of residential setting.
Similarly, some commenters believe
that if a converted nursing home space
meets the requirements of § 441.530(a)
and § 441.710(a) then there should not
apply a rebuttable presumption that the
setting is not a home and communitybased setting.
Response: We appreciate the
commenters’ concerns. It is not our
intent to have individuals move into
long term care facilities, when their
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needs could be met safely and
adequately in a less restrictive
environment. Our experience has shown
that settings in close proximity to
institutional settings, whether on the
same campus, in the same building,
sharing the same staff, and perhaps
sharing some common areas are more
likely to be operated in a manner similar
to the institution. They are often also
similarly segregated from the larger
community of individuals not receiving
Medicaid HCBS. Therefore, we strongly
believe in applying a presumption that
such settings are institutional in nature.
However, we recognize that not all
settings co-located, or closely located
with an institutional setting, exhibit the
same institutional characteristics.
Therefore, through the applicable state
plan amendment process, states will
have the opportunity to describe how
such settings meet the HCB setting
requirements set forth in this final rule
and do not have the qualities of an
institutional setting.
Comment: One commenter indicates
that there is a strong incentive for states,
local government authorities, and
providers to work together to use
existing segregated institutional
locations. The incentive falls toward
keeping these properties fully utilized.
These incentives will not be easily
overcome, and may well require an
outright prohibition on providing public
funding to settings that share the
buildings or grounds of an institution
that provides in-patient care. A few
commenters expressed concern with the
effect this rule will have on the
commenter’s state plan to rebalance its
long term care system. The state is
currently seeking to ‘‘right size’’ the
nursing home bed supply. The driving
force behind this initiative is to
rebalance the long term care system and
provide an optimal level of choice for
the consumer. It would only be natural
for long-term care providers to
participate in this right size initiative by
utilizing the state’s successful model of
affordable assisted living to create
campus settings that would provide a
full continuum of long term care
services. Many nursing home providers
possess land and existing structures that
could be used to develop managed
residential communities, individual
homes or cottages, or other independent
living options where assisted living or
home care services could be delivered
in accordance with an individualized
person-centered plan.
Response: We recognize that
repurposing existing building structures
is a tool used to control costs. However,
we believe that such structures should
not be a state’s first option when looking
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to increase the pool of community-based
residential settings. Such structures
were often built and operated in such a
way that they inherently hinder
individuals from participating in the
broader community, and reduce
individuals’ control of how and where
they receive services. However, there
may be circumstances where such a
setting could be repurposed in a way
that it would meet the requirements for
HCB settings and would no longer have
the characteristics of an institution. The
final rule allows a state to submit
evidence for CMS’ consideration in this
circumstance.
Comment: Many commenters
requested § 441.530(a)(2)(v) and
§ 441.710(a)(2)(v) be modified to also
include settings on the grounds of or
adjacent to a privately operated
institution. These commenters noted
that a private institution is no less
institutional than a public one and
should be treated the same for purposes
of this provision.
Response: We appreciate the
commenters’ concern. It is expected that
all settings, public and private, meet the
HCB setting requirements of this
regulation. We specifically make
reference to a setting that is adjacent to
a public institution in the regulation
language due to public input. However,
while we did not incorporate this
suggestion into the regulation, we note
that heightened scrutiny will be applied
to any setting that hinders or
discourages integration with the broader
community.
Comment: One commenter agreed that
it is important to have rules that
circumvent practices such as building
many group homes or apartments on the
grounds of institutions or on the
property where an institution once
stood. However, the commenter believes
the requirements proposed go too far, as
the standards would preclude people
from choosing to live in many
neighborhoods that might be in
proximity to an institution, such as the
VA hospital where they worked, even if
they live in proximity to other aspects
of community living as well.
Response: The presumption will be
applied to settings that discourage
integration of individuals from the
broader community. We will describe
these settings in future guidance and
will take into account the commenter’s
concerns about group homes on the
grounds of an institution that are
recently closed. Regarding the concerns
about settings adjacent to VA hospitals,
a residential setting that allows
individuals to have full access to
community services, and allows for
active participation in neighborhood/
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community events, resources and
integrated activities, but is located in
close proximity to a VA hospital might
meet the qualities for a home and
community-based setting and not the
qualities of an institution.
Comment: A few commenters
indicated that older persons often seek
out settings in which they can stay as
they grow older and develop service
needs. A significant number of older
persons prefer to live in a senior
community or similar setting that
includes a nursing facility, particularly
when one spouse or partner needs
nursing facility care and the other does
not. The commenter recommends that
being on the grounds of, or adjacent to
an institution not be a disqualifying
characteristic.
Response: We will engage in
discussion with any state who proposes
that such settings would meet the
qualities for home and communitybased and not the qualities for an
institution.
Comment: One commenter indicated
that the Fair Housing Act contains an
exception that allows distinctions based
on age, and believes this rule should do
so also.
Response: The purpose of this section
of the regulation is to define qualities
for home and community-based settings.
Since Medicaid services are available to
individuals of all ages, we do not
believe it is appropriate to create agebased distinctions.
Comment: One commenter believes
that hospital-based providers should not
be allowable HCBS providers. The
commenter also believes that there
should be two types of HCBS allowed
for a non-hospital entity to offer, even
if they are provided on the grounds of
a hospital: (1) Services provided by an
HCBS provider in the emergency room
before the patient is admitted to the
hospital, and (2) Discharge planning
with a patient in a hospital or long term
care setting in order to help facilitate a
more rapid, seamless, and coordinated
transition into community-based care.
Response: We recognize that while an
individual is moving through a state’s
overall service delivery system, there
may be certain circumstances in which
services provided under various
authorities may overlap. Services
should be provided as appropriate to
meet an individual’s needs; however, it
is incumbent upon the state to ensure
that there is no duplication of payment
for the same services. A provider of
HCBS could provide services in the
emergency room, as long as those
services are necessary and do not
duplicate the services being provided by
the emergency room.
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We believe it would be a best practice
for there to be communication between
those settings and the program that will
assist the individual in the community.
However, such communication should
not supplant the discharge planning
activities that hospitals and long-term
care settings are required to perform for
any individual leaving its setting.
Comment: A few commenters
requested the regulation define public
institution. One commenter requested
clarification on the definition of a
public institution. Specifically the
commenter wanted to know if ‘‘public
institution’’ means an ICF/MR, or
whether it also includes a university,
library or community care hospital.
Another commenter wanted to know if
this provision presumptively excludes
HCBS in publicly funded housing for
older persons if a nursing home
happens to be located on the same
campus.
Response: The term public institution
is already defined in Medicaid
regulations for purposes of determining
the availability of Federal Financial
Participation (FFP). Section 435.1010,
specifies that the term public institution
means an institution that is the
responsibility of a governmental unit or
over which a governmental unit
exercises administrative control.
Medical institutions, intermediate care
facilities, child care institutions and
publicly operated community
residences are not included in the
definition, nor does the term apply to
universities, public libraries or other
similar settings. We will apply this
existing definition in implementing the
provisions of this final rule. However,
we note that any setting that has the
effect of isolating individuals receiving
Medicaid HCBS from the broader
community of individuals not receiving
Medicaid HCBS will be presumed to be
a setting that has the qualities of an
institution unless the Secretary
determines through heightened scrutiny
that it has the qualities of home and
community-based settings. Thus,
settings that are located on the grounds
of, or adjacent to, institutions that are
not defined as public institutions under
the existing regulation will still be
subject to heightened scrutiny if such
settings have the effect of isolating or
segregating those receiving HCBS from
the broader community.
Comment: One commenter expressed
concern about the effect this regulation
will have on individuals living in
continuing care retirement communities
(CCRC’s). Another commenter believes
that co-location on a campus facilitates
efficiency, reduces administrative and
food service costs, and potentially
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increases the quality of services
provided in the nursing home since the
independent living residents often visit
their friends who reside in the CCRC’s
nursing home. The commenter added
that co-location facilitates seamless
transition among the various levels of
care on campus. One commenter
expressed concern that the regulation
would have a particularly negative
impact on not-for-profit long term care
providers that more often provide
services in a multi-level campus setting
because of their missions to meet the
multiple needs of the community.
Response: In general, CCRC’s are a
combination of residential settings and
care options that include independent
living, assisted living, and nursing home
care. It is possible that currently the
state considers the independent living
units to be home and community-based.
Nursing facilities are statutorily
prohibited from being considered home
and community-based and is considered
an institutional setting. The
independent living units and assisted
living units would be presumed
institutional and receive heightened
scrutiny if they are (1) located in the
same building as the nursing home or
other facility providing inpatient
treatment; or (2) if they are located on
the grounds of, or immediately adjacent
to, a public institution.
Comment: One commenter believes
that excluding assisted living facilities
that are on the same grounds of an
institutional facility may be limiting the
choices available to individuals. The
commenter believes that offering a
variety of locations for community
based services better addresses the
diverse population that receives these
services.
Response: Assisted living facilities are
not excluded from being considered
home and community-based if they are
structured and operate in a manner that
adheres to the requirements set forth in
this rule.
Comment: One commenter requested
that CMS clarify what is ‘‘inpatient
institutional treatment’’ and asked
whether ‘‘provides’’ means direct
provision of services by the facility, any
provision of services in the facility, or
facilitating the provision of such
services.
Response: Inpatient institutional
treatment means that services are
provided 24 hours/7 days a week.
Therefore, to avoid confusion, we have
retained the language ‘‘inpatient
institutional treatment.’’
Comment: Many commenters believe
the proposed regulations would
eliminate or severely restrict the
provision of HCBS in programs located
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adjacent to a public institution even
though the program is also adjacent to
other buildings such as local
community colleges and universities,
stores and businesses, and residential
communities. Other commenters
indicated that proximity to an
institutional setting should not alone be
the basis to disqualify a setting as HCB
and stated that many seniors choose to
live in a community that offers a range
of settings.
Response: We believe that if the
setting meets the requirements set forth
in § 441.530(a)(1) and § 441.710(a)(1), is
not described as prohibited under
§ 441.530(a)(2) and § 441.710(a)(2), and
does not exhibit qualities of an
institutional setting, then the services
could be provided in settings like those
to which the commenters refer.
Comment: A few commenters
expressed concern that the language in
the proposed regulation could be
construed to prohibit the use of HCBS
to fund appropriate services on a
campus that provides a variety of day
habilitation services and employment
opportunities for individuals with
intellectual and related disabilities. For
the commenters this would be an
unacceptable and radical policy change
from the perspective of these
individuals and families who have
relied on these services for years. The
commenters believe the location allows
individuals to be part of the community.
The program is located adjacent to a
residential neighborhood and shares a
parking lot with a college. The
commenters are concerned that if these
longstanding programs are no longer
permissible for these individuals, their
alternative would be institutional
placement. The commenters request the
language ‘‘adjacent to’’ not be included
in the final regulation or that the
interpretative language accompanying
the publication of the final regulation
explicitly clarify that the circumstances
described above do not make this type
of program ineligible for HCBS funding.
Response: 1915(i) State plan HCBS
and 1915(k) CFC services (for example,
residential, day or other) must be
delivered in a setting that meets the
HCB setting requirements as set forth in
this rule. We will provide further
guidance regarding applying the
regulations to non-residential HCBS
settings. In addition, since this authority
provides states the opportunity to
provide individuals HCBS and not
institutional services, individuals
receiving 1915(i) State plan HCBS or
1915(k) CFC services must be living in
settings that comport with the HCB
setting requirements as set forth in this
rule regardless of whether they are
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receiving HCBS in that residence. This
is consistent with CMS’ longstanding
policy regarding 1915(c) HCBS.
Comment: We received many
comments both in support of and
opposition to the requirement that
would have resulted in heightened
scrutiny over a disability-specific
housing complex. The comments we
received on this provision are reflected
as follows:
Several commenters recommend the
regulation be revised to remove
‘‘disability specific housing complex’’ as
a setting in which HCBS may not be
provided. The commenters believe that
people with disabilities should be able
to choose to live in disability specific
housing if the housing addresses their
needs. One commenter stated that being
a disability focused apartment building
does not warrant the need for extra
scrutiny. There are significant
differences between an institution and a
housing development.
Many commenters requested the rule
clarify that the reference to a ‘‘disabilityspecific housing complex’’ was
intended to refer to settings located in
a disability-specific housing complex—
as well as on the grounds of, or
immediately adjacent to, such a
complex.
Many commenters expressed concern
that the proposed regulations would
eliminate or severely restrict HCB
services to residents with disabilities in
supported living arrangements
authorized under and meeting the
requirements of HUD Section 811 and
Section 202 multi-family housing units,
because the homes built under HUD
Section 811 or 202 are specifically
restricted to people with specific
disabilities. They believe the proposed
rule appears to conflict with HUD
policies.
Several commenters believe that
regulatory language will result in the
elimination of longstanding services
that meet the needs of a large number
of individuals. The commenters
recommended that CMS issue
interpretive guidance accompanying the
final regulation to explain that a
program located in a building on the
premises of a disability-specific housing
complex may receive HCBS if the
housing complex is in compliance with
the underlying laws and implementing
regulations, including Section 811 of the
National Affordable Housing Act of
1990, as amended and implementing
regulations (supported housing for
persons with disabilities), the Fair
Housing Act, and the ADA.
Many commenters expressed concern
that the use of the term disability
specific complex would eliminate or
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severely restrict the provision of HCBS
in group homes set around a courtyard
where individuals with disabilities have
many needed services and supports
built into their day-to-day living and
have transportation and other assistance
to access the general community.
Many commenters requested the
regulation provide a definition of the
term ‘‘disability-specific housing
complex.’’ Many commenters believe
that undefined, the term is unclear, and
too broad.
Several commenters requested we
clarify that ‘‘CMS did not intend to
include group homes located in and
fully integrated into typical
neighborhoods within the meaning of
‘‘disability-specific housing complex.’’
A few commenters requested the rule
clarify whether the presumption that a
disability-specific complex is not a
home and community based setting
applies only if the setting does not meet
the other criteria established in the
regulation.
One commenter believes the potential
elimination of disability-specific
housing complexes as home and
community-based settings will
compromise viable housing alternatives
in a housing market that is already in
crisis, devastate the ability of providers
to deliver services in settings that
promote health and safety, and force
individuals with developmental
disabilities to move from their homes or
lose their services and supports.
One commenter expressed opposition
to the heightened scrutiny level of
review, as proposed in the regulation.
According to the commenter, families
believe their loved ones benefit from
these settings. Some planned residential
communities are much like retirement
communities where amenities such as
bowling alleys, theatre, community
centers, restaurants and shopping are
readily available, along with necessary
health care, support staff, vocational
training. The commenter further stated
that while the rule seems to embrace
certain principles of community, such
as individual choice and personcentered planning, there remains a bias
that characterizes any sort of programwide structure and safety measures as
too ‘‘institutional’’ without any regard to
the input of individuals, their families
and their legal guardians. This
commenter also stated that given that
there is already a Medicaid definition of
institution, it is improper for CMS to be
proposing an expansion of current
Medicaid law redefining the term.
Another commenter believes that the
proposed rule that considers a
‘‘disability-specific housing complex’’
an ‘‘institution’’ could be confusing and
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a barrier to effective community housing
options for those with intellectual
disabilities.
Many commenters objected to the
inclusion of disability specific housing
as institutional in that many people
choose, as a function of age, to live with
others with similar needs. The
commenters indicated that senior
housing, assisted living, and other such
options are freely chosen by seniors
without disabilities and inquired why
people with disabilities who are eligible
for HCBS be denied the same array of
options available to their peers without
disabilities. The commenter noted that
the key is that the person-centered plan
should provide for individuals making
free choices in where they live as long
as they do not include nursing facilities,
institutions for mental diseases,
intermediate care facilities for mentally
retarded, hospitals, or other locations
that have the qualities of an institutional
setting as determined by the Secretary.
Other commenters suggested that
seniors often choose to live together in
a variety of settings and request that
CMS respect this preference by
establishing exemptions from the
proposed setting requirements for
continuing care campuses, assisted
living settings, and other housing for
older persons. The commenter stated
that CMS should not preclude
successful options for people with
disabilities simply based on location or
proximity. Alternatively, one
commenter indicated that he does not
have the same philosophy and asserted
that this provision must remain in these
regulations. This opinion is based on
the commenter’s experience with the
deinstitutionalization of people with
intellectual and developmental
disabilities and the commenter’s
knowledge of recent efforts in certain
states to try and use waivers to fund
settings that do not promote full
inclusion in community life. If CMS
does decide to create an exception, the
commenter urges we keep it very
narrowly tailored to senior communities
only, so that it cannot be used to limit
the opportunities of people with
intellectual and developmental
disabilities to experience true
integration.
A few commenters requested the
regulation clarify if housing or units
within general housing, designated for
persons with dementia or other
cognitive impairments would meet the
definition of disability-specific housing
complexes. Other commenters added
that it is discriminatory to deny HCBS
waivers to individuals residing in an
Assisted Living Facility providing care
specifically to those with Alzheimer’s
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and dementia just because of where they
live.
Response: As a result of comments we
received on the use of the term
disability specific-complex, we have
revised the rule to remove the term
‘‘disability-specific housing complex’’
and replace it with the following
language: ‘‘any other setting that has the
effect of isolating individuals receiving
Medicaid HCBS from the broader
community of individuals not receiving
Medicaid HCBS…’’ We note that we are
not redefining the term ‘‘institution’’ but
rather defining what characteristics we
will see as institutional and not HCB in
nature. We plan to issue future guidance
to provide examples of the types of
settings that will be subject to
heightened scrutiny.
Comment: One commenter shared the
opinion that disability-specific housing
complexes are established for the
convenience of service providers, or
because the developer believes that
people with disabilities should be
segregated, or both. The commenter
further explains that disability-specific
housing complexes are not integrated at
all, and therefore certainly not the most
integrated setting appropriate to
anyone’s needs. The commenter
recommends that they must not be
included as home and community based
settings.
Response: We appreciate the
commenter’s perspective. We do not
believe that all settings should be
excluded; however, we do believe a
close review of such settings may be
necessary.
Comment: Many commenters
indicated that if the rule is finalized
with application of a rebuttable
presumption then it should only apply
to disability-specific housing
complexes. The commenters
recommended that CMS should specify
that the presumption may be rebutted
only when (1) the setting meets all of
the requirements for home and
community-based settings in
§ 441.530(a)(1) and § 441.656(a)(1), and
(2) the setting was selected by the
individual following a meaningful
opportunity to choose from among
alternatives, including the most
integrated setting for the individual as
documented in the person-centered
service plan.
Response: We do not agree with the
commenter’s recommendations. Section
441.530(a)(2)(v) and § 441.710(a)(2)(v)
have been revised to better articulate the
settings that are presumed institutional
in nature and will receive heightened
scrutiny to determine if they can be
considered home and community-based
settings.
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Comment: One commenter believes
the rebuttable presumption language
also applies to settings where there are
specialized services for individuals with
similar diagnoses. Many of these
programs were designed, developed and
chosen by consumers to reflect new
standards of care and treatment. The
commenter urges CMS to change the
language in the rule to reflect this model
of care and not limit these programs to
only non-Medicaid persons.
Response: We recognize that there are
many forms of settings and service
delivery models serving individuals
with a need for long term care services
and supports. Due to this variability
across the country, we do not believe it
would be best to carve out certain
models in this rule.
Comment: Many commenters were
concerned about the effect the proposed
rules would have on settings
specifically designed for individuals
with autism. The commenters stated
that many of these individuals failed to
thrive in both institutional and totally
independent settings, but they do thrive
in certain non-urban community based
models. The commenters believe the
proposed rule ignores the community
based nature of these models and
inaccurately and unreasonably
categorizes these settings as institutions.
One commenter believes the proposed
regulations will cause downsizing and
elimination of public and private
specialized residential facilities for
persons with severe and profound
cognitive-developmental disabilities
Response: We believe that settings
that are designed to prevent an
individual from having the opportunity
to participate in the broader community
are not home and community-based. We
believe that individuals, regardless of
service need, can benefit from having
the opportunity to participate in the
broader community. The goal of this
regulation is not to take services from
individuals, or make individuals move
from a location where they have always
lived, but to describe the qualities of
settings in which services intended to
provide an alternative to institutional
care may be delivered. The goal of this
regulation is to widen the door of
opportunity for individuals receiving
Medicaid HCBS to support the same
choices to participate in community
activities as are available to individuals
not receiving Medicaid HCBS; to have a
choice in how, when, and where they
receive services; and to remove
unnecessary barriers and controls. We
believe that the Medicaid program
provides many options for states to
develop delivery systems that meet the
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needs of individuals regardless of where
they fall on the continuum of care.
Comment: A few commenters
expressed the belief that individuals
with severe cognitive impairments
should be allowed to live together,
because the commenters believe that
this is not a population that can benefit
by integration within the community at
large. The commenter stated that special
programming and physical plan
improvements for this population have
contributed to increased quality of life
and quality of care for this population.
The commenters request the rule be
amended to allow individuals with
cognitive impairments to live together
and that this not be considered
disability-related segregation.
Response: We disagree with the
commenter in part. We agree that
individuals benefit from services that
are specialized and tailored to meet
their specific needs. However, we firmly
believe that all individuals regardless of
type or degree of disability would
benefit from opportunities for
community integration if it is their
choice to live in the community and not
an institution. We note that Medicaid
continues to provide other service
options that can support individuals
who choose to receive services in nonHCB settings.
Comment: One commenter believes
the proposed changes to the rules would
prevent an individual from making a
choice to live in a rural agricultural
community setting with several homes
on the property. The commenter
requested the rules be revised so that
every person with every type of
disability is given a choice that would
meet the individual needs and unique
characteristics of the person.
Response: Under the requirements of
this regulation, for a setting to be home
and community-based, it may not
discourage an individual’s integration
with the broader community. The
determination would not be based on
whether the setting was in a rural,
urban, or suburban community, but on
whether it has the qualities of home and
community-based settings as specified
in this rule.
Comment: One commenter indicated
that in their state, there is the option for
individuals to choose fully accessible
individual apartments and accessible
complexes that are disability-specific
housing settings located in community
neighborhoods that provide quick
response and 24-hour onsite coverage.
The commenter stated that the number
of these settings has grown and
consistently includes waiting lists, and
to eliminate these settings for Medicaid
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HCBS recipients unfairly limits their
choice.
Other commenters expressed concern
that many seniors living in age-specific
communities will inadvertently be
prohibited from receiving HCBS due to
proximity to a hospital or nursing
facility. The rule, they believe, will lead
to more nursing home admissions
among seniors and limit choices
available to them to receive services in
an assisted living facility (ALF). The
commenters also stated the proposed
language would likely reduce the
number of individuals in nursing homes
who are able to transition to a more
integrated setting, because many
individuals transition to ALFs. It should
be considered desirable that those
served by Medicaid would have the
same array of choices as those not on
Medicaid.
Response: We have removed the
references to disability-specific housing
in the text of the final regulation.
However, if the settings have the effect
of isolating individuals receiving
Medicaid HCBS from the broader
community, we will apply heightened
scrutiny to these settings to determine if
they meet the required qualities for a
home and community-based setting as
set forth in this rule. The State could
present information to CMS to
demonstrate that the settings have the
qualities of community-based settings.
Comment: Several commenters
supported the language as written,
stating appreciation that CMS has
clarified that the term ‘‘community’’
refers to the greater community and not
solely a community of one’s peers and,
that integration also means more than
integration in a community of peers.
They further stated that focusing on the
purpose of HCBS helps define its
characteristics. A few commenters
agreed that a home and community
setting should facilitate individuals’ full
access to the greater community as they
choose, including in the areas noted.
However, the commenters noted that
individuals may vary in their choices as
they seek full access to and
participation in the greater community,
and a home and community-based
setting should facilitate such full access
consistent with an individual’s choices
and preferences. The commenters
recommended adding the following
language related to access ‘‘based on the
individual’s needs and preferences.’’
Another commenter stated the belief
that the language is very broad and
ambiguous and should be defined along
with ‘‘the greater community.’’ Another
commenter requested that we define
‘‘community’’ and suggested the
language parallel the language used
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under the section pertaining to personcentered service plan, stressing that
individuals should be given the right to
obtain services ‘‘from the provider and
the community of his or her choice.’’
Response: We support individual
choice and agree that individuals may
vary in their choices as they seek full
access and participation in the greater
community. However, in order to
receive approval of a State plan under
which it will receive Medicaid funding
for HCBS, a state must ensure that the
choices available to individuals meet
the requirements for community
integration at § 441.710 of the final rule.
Comment: Some commenters
expressed concern with the requirement
as proposed at § 441.530(a)(1)(i) that the
setting must permit access to the greater
community ‘‘in the same manner as
individuals without disabilities.’’ One
commenter stated that it would be more
appropriate to require access ‘‘to the
same extent’’ and that this language will
give HCBS providers reasonable
flexibility in regards to making
accommodations for disabilities and to
avoid disputes and possible litigation on
the exact manner in which such
accommodation must be provided.
Other commenters indicated that this
requirement is not measurable and may
reduce choice for rural populations.
Response: After significant
consideration, we have removed from
§ 441.530(a)(1)(i) ‘‘in the same manner
as’’ from this requirement, and replaced
it with ‘‘to the same degree of access
as,’’ to best describe our intent to ensure
access to the greater community that
includes individuals with and without
disabilities.
Comment: One commenter stated that
licensed facilities may be located in
both urban and rural settings resulting
in variation with the amount of
‘‘integration’’ available. The settings are
chosen with this in mind, and one that
seems to be less integrated to CMS may
be preferred by some over living where
it appears participation in community
activities is greater.
Response: We agree that there is a
large degree of variance regarding the
geographical settings where licensed
homes are located. We agree that an
individual should be able to exercise
choice in regard to these settings. We do
not express preference in regard to the
proximity of activities to where an
individual lives; the emphasis is on
access to those chosen activities and
whether the individual has the same
degree of access to such activities as
individuals not receiving Medicaid
HCBS.
Comment: One commenter believes
that CMS should not disqualify any
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setting from receiving federal financial
participation (FFP) solely based on the
fact that it is a congregate setting.
Response: It is not our intention to
exclude a state from receiving FFP for
a setting solely based on the fact that it
is a congregate setting. Our intention is
to specify qualities necessary for a
setting to be considered a HCB setting.
Congregate settings may be included if
they meet the HCB setting requirements
set forth in this rule.
Comment: Several commenters stated
that a service provider (for example, a
job coach), not a setting, facilitates
employment-seeking opportunities.
Similarly, a service provider, not a
setting, assists individuals in managing
what few disposable resources are
available to them. One commenter seeks
clarification regarding what facilitating
‘‘full access to . . . employment
opportunities’’ entails and what
possibilities, if any, would be imposed
on the housing provider. One
commenter supports the concept of
community integration, but believes
CMS has blurred the distinction
between the setting and the service
provider. One commenter believes that
CMS is wrong to assume that location
will enforce the goals of integration, for
example, social interaction, productivity
and competitive employment. The
commenter further notes that having the
ability to access the general community
is very different from being forced to
live in a community ‘‘setting’’ that is not
only unwilling, but unable to provide
resources for safety, supports,
interaction, social integration and
employment in competitive settings.
One commenter encourages CMS to
ensure that the settings in which
residents receive services are designed
to facilitate the actual integration of the
recipients into the surrounding
community.
Response: We agree that it is the
responsibility of the service provider
rendering the services and therefore we
have added language under personcentered service plan requirements to
ensure a clear understanding of our
expectation. We believe the section on
person-centered planning clarifies CMS’
expectations with regard to services
being delivered in a manner that
promotes/supports community
integration to the extent of the
individual’s preferences and desired
outcomes.
Comment: Several commenters
expressed strong support for the setting
integration provision, but recommended
modifying § 441.530(a)(1)(i) to specify
that the employment-related provision
apply only to those individuals who are
interested in being employed. They
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recommended modifying
§ 441.530(a)(1)(i) by adding the
following language ‘‘for those
individuals interested in being
employed’’ following the words
‘‘integrated settings.’’ Another
commenter recommended the following
revision to § 441.530(a)(1)(i): ‘‘For
individuals seeking to enter the job
market, the setting should include
opportunities to seek employment and
work in a competitive integrated setting.
For all individuals, the setting should
permit them to engage in. . . .’’
Response: We believe that individuals
should be supported in seeking
employment when interested in being
employed and that the statement
‘‘opportunities to seek employment’’
implies choice. In addition, we believe
that adding the suggested language to
the regulation text is unnecessary.
Comment: One commenter offered
support of CMS’ general approach of
identifying the characteristics of
integrated care, but suggested that CMS
will need to take an active monitoring
role to ensure that all the individual
quality requirements are enforceable.
Response: States are required to
demonstrate at the time of approval that
quality measures with a monitoring plan
are in place. This information must be
included in the SPA and at a frequency
to be determined by us or upon request
by us. The review and monitoring of
quality requirements will be covered in
future guidance.
Comment: One commenter stated that,
it would be unpatriotic to curtail any
services in a manner that would
adversely affect humans with limited
abilities.
Response: It is not our intention to
negatively impact any individuals we
serve. Rather the purpose of the rule is
to ensure that states will be better able
to design and tailor Medicaid services to
accommodate individual’s needs and
preferences.
Comment: Commenters stated that all
people need meaningful choices about
where and with whom they live, how
they spend their time and their
activities, friends, and services
(including who provides them).
Permitting individuals the freedom to
make their own choices allows them to
remain as independent as possible. One
commenter applauded efforts that focus
on the individual’s ability to choose his
or her own life setting and one that
promotes community rather than
institutions. Several commenters noted
that while providers may make different
choices than the client and have a
different perspective, the provider must
respect and honor the choices and
autonomy of people with disabilities.
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One commenter supports the proposed
language as long as it provides
assurances that real alternatives exist.
Additionally, another commenter
recommends reinforcing the idea that
states should provide unbiased and
informed options counseling for
individuals seeking HCBS so that
individuals are able to choose the
setting that best assists them in meeting
their needs and life goals.
Response: We agree that meaningful
choices that allow individuals to make
decisions that best meet their needs are
important. In addition, they should be
addressed as part of the person-centered
planning process and reflected in the
individual’s person-centered service
plan.
Comment: One commenter stated that
the proposed regulation would
eliminate or at least severely restrict
client and family choice of program
options and opportunities and that
consumers and families need more
options, not fewer during these difficult
times. Several other commenters
expressed serious concern that the
proposed regulation will eliminate
instead of enhance choice for
individuals with significant disabilities.
Response: We disagree. We are not
eliminating the choice of institutional
options. We are specifying the qualities
necessary for settings to be considered
home and community-based settings.
Comment: Many commenters stated
the proposed language in
§ 441.530(a)(1)(ii) and § 441.656(a)(1)(ii)
should be modified to more closely
reflect the tenets of the ADA and the
Olmstead decision by including
additional language that conveys the
individual’s choice of setting must be an
informed choice, based on more than
verbal descriptions or pictures of
alternatives. Modifications should
include language that permits
individuals a meaningful opportunity to
choose from among all available
alternatives. Commenters conclude that
the level of specificity with which a
particular setting must be identified in
a service plan is not clear and the
requirement could inappropriately
prevent individuals from receiving
services when their desired living
setting is specifically identified in a
service plan.
Response: We believe the final
regulation language supports these
principles. Within future guidance, we
will reinforce the importance of
complying with other federal
requirements such as ADA and
Olmstead.
Comment: One commenter
recommends striking the word
‘‘available’’ from § 441.530(a)(1)(ii) and
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§ 441.656(a)(1)(ii) of the proposed
regulation. The commenter believes that
this word could limit choices of HCBS
settings offered to individuals and offers
the example of long waiting lists for
certain section 1915(c) HCBS waiver
programs/settings not being considered
and reflected in the person-centered
plan due to lack of availability.
Response: We have revised
§ 441.530(a)(1)(ii) pertaining to CFC
settings and the final regulation text at
§ 441.710(a)(1)(ii) and we have removed
the term ‘‘available.’’
Comment: One commenter was
supportive of this language as written.
Another commenter supported CMS’
proposed list of essential personal rights
in this section. The commenter stated
that, in addition to freedom from
coercion and restraint, people with
disabilities in a community setting
should have the freedom to pursue their
sexuality, voting, and worship. In
addition, a community setting should
not be permitted to restrict access to the
community as a form of punishment.
Response: We are concerned that one
of the commenters believes we have
provided a comprehensive list of rights.
The factors related to determining
whether settings are home and
community-based and the description of
the rights that individuals must have in
these settings are not intended to be an
exhaustive list of all legal rights of the
individual. Individuals have many other
legal rights not addressed in this
regulation. For example, civil rights
against various forms of discrimination
are protected under the ADA and
elsewhere. We regularly work with the
HHS Office for Civil Rights, Department
of Justice (DOJ), and others to assure
that we provide appropriate guidance
and assistance to states related to civil
rights issues that bear on Medicaid
requirements.
Comment: Many commenters stated
that the inclusion of ‘‘essential
personal’’ may create confusion and
suggest that the term be omitted from
§ 441.530(a)(1)(iii) to more clearly
demonstrate intent to protect the
individuals’ human rights. Several
commenters indicated that they strongly
agree that these important personal
rights should be protected. However, as
currently written the placement of
‘‘essential’’ may imply that other rights
are not essential and thus do not need
to be protected. These commenters
recommended removing the term
‘‘essential’’ from this paragraph.
Response: We agree with the
suggested revision to § 441.530(a)(1)(iii)
and have finalized the provision at
§ 441.710(a)(1)(iii) by removing the
words ‘‘essential personal.’’
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Comment: One commenter generally
supports the proposed language, but
recommends that CMS delete the
reference to restraint and/or provide an
exception when the individual has a
documented history of risk of elopement
or susceptibility to behavioral flare-ups
that can only be controlled by
temporary restraint.
Response: We disagree with the
recommendation as this is an important
protection.
Comment: Several commenters
supported the protection of
independence and the autonomy of
individuals in making life choices. One
commenter stated that the postrulemaking implementation must
ensure that the intent of the proposal is
carried out in practice. Another
commenter generally supported the
proposed concept, but noted that the life
choices principles are dictated by the
service provider and not the setting.
Response: The State Medicaid Agency
will be responsible for ensuring that the
HCB setting requirements are met by
providers who own or control settings
where individuals reside and/or receive
services.
Comment: Some commenters stated
that the language may potentially result
in limited choice, scattered living
proposals, limiting staffing resources
and increasing costs associated with
some individuals choosing to live
secluded from others with disabilities.
The commenter stated that individuals
make choices that increase their
independence (within the resources that
are provided through Medicaid) based
on informed experiences to ‘‘live and
play’’ with others who are
developmentally disabled because they
have much in common. Another
commenter disagreed with this
proposed requirement and believes that
individuals should have the right to
choose where they want to live.
Commenters stated that one size does
not fit all and that different populations
have differing needs. Commenters
supported an individual’s right to
choose to reside in a living arrangement
that best suits his/her needs. The
commenter also stated that this
proposed requirement would eliminate
important options that now contribute
to the array of settings available to
adults with disabilities and the elderly
and the move to a more restrictive
setting would ignore the participant’s
choice, diminish the participant’s
quality of life and increase costs to
Medicaid.
Response: We believe that individual
choice is important and we have worked
to promote choice in the final rule,
though we also acknowledge the
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challenge of doing so in a manner that
addresses the interests of diverse
populations with differing needs. We
have revised the language in the final
rule to be more flexible and less
prescriptive. Instead of automatically
excluding certain settings from
qualifying as HCB, the language in the
final rule includes a presumption that
these settings are not HCB. In other
words, we will assume that certain
types of settings—specifically, those
located in a building that is also a
publicly or privately operated facility
that provides inpatient institutional
treatment, on the grounds of or
immediately adjacent to a public
institution, or any other setting that has
the effect of isolating individuals
receiving HCBS from the broader
community—are not HCB, but afford
states the opportunity to refute this
categorization by providing additional
information about the characteristics of
specific settings. We have also included
language in the final rule that focuses on
the critical role of person-centered
planning and addresses fundamental
protections regarding privacy, dignity,
respect, and freedoms.
Comment: Several commenters
recommended that CMS delete the
phrase ‘‘and not regimented’’ from the
proposed language. The commenters
expressed concern that under the
proposed language, group programming
could be viewed as ‘‘regimented’’
because it is provided in a congregate
setting. One commenter noted that
structured activities and socialization
opportunities could be deemed
inappropriate under the proposed
language since they may be provided in
a uniform manner.
Response: We disagree with removing
this language from the final rule. We do
not intend to invalidate all activities in
a congregate setting. Individuals must
be afforded choice regarding the
activities in which they wish to
participate including whether to
participate in a group activity or to
engage in other activities which may not
be pre-planned.
Comment: One commenter
recommended adding the following
language to this provision of the rule:
‘‘(iv) Individual initiative, autonomy,
and independence in making life
choices, including but not limited to,
daily activities, physical environment,
and with whom to interact are
optimized to the greatest extent possible
and not regimented.’’ One commenter
recommended that CMS clarify that the
term ‘‘optimized’’ refers to the
individual’s autonomy and does not
refer to optimizing the institution’s
promotion of autonomy. Another
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commenter requested that CMS clarify
who will determine and how to
determine whether the individual
initiative, autonomy, and independence
in making life choices were optimized.
Response: We do not believe that ‘‘to
the greatest extent possible’’ adds
significantly to the term ‘‘optimized.’’
We believe the commenter’s concern
about referencing individual autonomy
is addressed in the regulation language.
There are a number of methods inherent
in the flexibility of the HCBS benefits to
determine who and how the
individual’s initiative, autonomy, and
independence are optimized.
Comment: Many commenters stated
that an individual’s choice regarding
services and supports and who provides
them is a key element of HCBS and,
thus, must be ensured. Some
commenters suggested substituting the
word ‘‘ensured’’ in place of
‘‘facilitated.’’ One commenter stated that
the word ‘‘facilitated’’ establishes a
weak standard and should be replaced
with ‘‘maximized.’’ Another commenter
suggested that individuals be given
choices about when services are
provided and recommended deleting ‘‘is
facilitated’’ and replacing it with ‘‘is
honored’’ for further assurance. One
commenter stated that an individual’s
choice must be ensured, meaning ‘‘made
certain or safe’’ and stated that in a
home and community-based setting,
personal choice should not only be
brought about, but is safe. Another
commenter expressed concern that ‘‘is
facilitated’’ is not used to water down
individuals exercising choice over
services, supports, and providers. The
commenter stated that some individuals
may need assistance in exercising
choice and the commenter suggested
revising this criterion to note that
support should be provided, as needed,
to facilitate such choices and to
acknowledge that an individual’s
chosen representative may be acting on
behalf of the individual.
Response: After consideration of the
commenters’ thoughtful suggested text
changes, we believe the proposed text/
language reflects the intent of the
provision.
Comment: Several commenters
indicated that provider owned or
controlled settings licensed by state law
have requirements that make them
responsible for the well-being of the
resident and restrictions on who (in
addition to the licensed provider) can
provide services in the setting.
Commenters stated that residents’ rights
allow for individuals to supplement
existing services provided by the
providers, but not replace them. Several
commenters recommended revisions to
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this section of the rule and some of the
commenters suggested that language be
included to reference state licensure
laws and licensing entities.
Response: We disagree with the
suggested changes. Some of these were
too descriptive to include in regulation
and could have the effect of excluding
numerous populations served through
HCBS programs. We will instead
consider these suggestions in future
guidance.
Comment: One commenter requested
that the rule clarify how a person’s
choice about the type of services they
want and who they want to provide
them ‘‘is facilitated.’’ The commenter
suggests this can be done by clarifying
the qualifications that the facilitator
must possess—for example, the
facilitator must be knowledgeable of all
community-based options (not only
those that are considered readily
available) and must be able to present
options in a way that is accessible and
is sensitive to the person’s disabilityrelated communication needs.
Response: States are responsible for
determining the provider qualifications
of the entities who will conduct the
assessments and person-centered
planning process as long as the
requirements in the final regulations
have been met. It is expected that these
entities would have adequate training to
perform this function. We agree that
additional guidance should be provided
to states and we intend to issue future
guidance regarding the person-centered
process and how we intend to apply it
across Medicaid HCBS programs.
Comment: Several commenters
supported the additional conditions
stating that they are critical to ensuring
that provider-controlled settings
designated as home and communitybased operate in a way that promoted
choice, autonomy and independence.
Response: We appreciate this
comment of support regarding the
importance of the additional conditions.
Comment: One commenter generally
supported the provisions but suggested
that the language include ‘‘health
needs’’ in addition to ‘‘safety needs’’
and that the term ‘‘dementia’’ be
changed to ‘‘cognitive impairment’’ to
include individuals with severe mental
illnesses, traumatic brain injuries, and
developmental disabilities, as well as
Alzheimer’s and other forms of
dementia.
Response: The reference to dementia
was only included as an example and
was not meant to convey all of the
possible situations in which a
modification of the conditions might be
supported by a specific assessed and
documented need. We have, therefore,
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removed this example from regulation
text as this is more appropriate for us to
address in future guidance, and we will
consider these comments in that
context.
Comment: Several commenters
strongly agreed with the proposed
language requiring that should a
provider choose to modify conditions,
changes must be supported by
documentation in the person’s service
plan. Another commenter expressed
support of CMS’ efforts to allow
necessary flexibility to address
individual circumstances in providerbased settings, but urged CMS to allow
flexibility in interpretation of the
language, ‘‘specific assessed’’ need. Two
commenters also expressed concern
over this language, noting that in some
instances residents may require services
based on overall condition rather than a
specific assessed need and suggested
revision to this subsection of the rule.
Response: We acknowledge and
appreciate support of the requirement
that any modification of the conditions
for provider-owned or controlled
residential settings must be supported
by a specific assessed need and
documented in the person-centered
service plan. However, we disagree that
such modification would be acceptable
based on a condition that does not also
result in a specific assessed need of an
individual. Allowing for modifications
based on a condition that is not also
supported by a specific assessed need
and documented in the person-centered
service plan could result in decisions
being made based on global assertions
as opposed to individual need, and thus
be contrary to the purpose of this
section of the rule. Therefore, we have
not made the requested revision to this
requirement.
Comment: Several commenters stated
that modifications must be related to a
clearly established assessed need and
recommended a change to the proposed
rule so that the requirements must apply
to all settings where services are
provided, regardless of whether or not
they are controlled by the service
provider.
Response: We agree that any
modification of additional conditions
must be based on the specific assessed
need of the individual. The regulation
includes qualities that apply to all home
and community-based settings, but we
disagree that the additional
requirements for provider-owned or
controlled settings must be required of
all settings where services are provided,
regardless of whether or not they are
provider-owned or operated. The
additional conditions were designed to
ensure that individuals who are living
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in settings in which the individual does
not have ownership or control, will be
afforded the same opportunities and
community access as individuals living
in their own private or family homes.
Comment: One commenter
recommended that States should be able
to detail their own policies and
practices to address rights and
restrictions as part of their application
for HCBS authority, an expectation
currently embedded in the waiver
application but not in regulation.
Response: We disagree that states
should detail their own policies to
address rights and restrictions. Based on
our experience and on input received
from the public, we believe we must set
these minimum additional conditions to
ensure individual rights are protected.
Comment: Several commenters stated
that CMS should take into account the
differences between different
disabilities in determining when
departure from the additional
conditions may be permitted. These
commenters stated that, if CMS allows
for the modifications to provider
requirements, CMS should require that
the restrictions be directly proportionate
to a specific safety need and be
reviewed for effectiveness and
continuing need.
Response: Any modifications of the
conditions can only be considered on an
individual basis in accordance with the
person-centered planning process and
documented in the person-centered
service plan in accordance with section
441.725.
Comment: One commenter
recommends adding a component
whereby direct feedback is gathered
from the beneficiary or the beneficiary’s
representative regarding initial and
ongoing overall satisfaction with the
modification of conditions.
Response: The rule has been modified
to require that any modification to the
additional conditions under
§ 441.710(a)(1)(vi)(A) through (D) must
have the informed consent of the
individual (or representative).
Comment: One commenter stated that
a modification may be needed to reflect
the involvement of an individual’s
representative, as appropriate, when
individuals are unable to act on their
own behalf.
Response: The regulation already
specifies the involvement of an
individual’s representative in the
evaluation of eligibility (§ 441.715),
independent assessment (§ 441.720),
and person-centered service plan
(§ 441.725). The regulations also include
a definition for individual’s
representative in section 441.735 of this
subpart. Since any modifications of the
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conditions would need to comply with
the requirements for these processes, we
do not believe that modification to the
regulation text is needed.
Comment: We received some
comments related to the difficulty of
achieving compliance with the
proposed requirements. A few
commenters expressed concern that the
conditions for provider-driven settings
might exclude assisted living residences
(ALRs), as it remains unclear whether
they would meet the proposed criteria.
Another commenter expressed great
concern that privately-owned
residential settings that have proven
successful in their state would not
qualify under the proposed guidelines
since many would not provide separate
kitchens or sleeping and living areas.
Another commenter stated that this
regulation severely restricts program
options and opportunities because of
the impact the regulation has on HUD
financed housing owned by providers,
and that this regulation would restrict
the use of HCBS waiver funding for
services provided in these settings.
Response: We believe there will be
residential settings that meet the HCB
requirements as outlined in this
regulation. However, we recognize that
there may be some residential facilities
that may not currently meet all of the
HCB setting requirements for providerowned or controlled settings. We will
allow states a transition/phase-in period
for states to demonstrate compliance
with the requirements. In an effort to
balance those comments that were
concerned with the loss of a residential
setting and the subsequent displacement
of the service recipient based on the
settings requirements and those
comments that urged us to draw an
immediate and clear demarcation for
HCBS, our expectation is that the
transition plan would facilitate a brief
transition period wherever possible.
However, we will afford states the
opportunity to propose a transition plan
that encompasses a period up to five
years after the effective date of the
regulation if the state can support the
need for such a period of time. States
are expected to demonstrate substantial
progress toward compliance throughout
any transition period.
Comment: One commenter expressed
concern that the proposed language
requires full participant direction even
when such direction may not be
appropriate for certain populations.
Response: Self-direction is an
optional service delivery method, not a
federal home and community-based
setting requirement in the proposed or
the final rule.
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Comment: Many commenters
indicated that the proposed language
provides an unchecked and overbroad
right for a service provider to modify
any of the requirements, as long as the
modification is supported by an
assessed need and documented in a
service plan. The commenters stated
that CMS should allow modifications of
the ‘‘additional conditions’’ only in rare
and extraordinary circumstances, and
then only after a provider has
documented that less intrusive
measures have already been tried, data
has been collected on the modification’s
effectiveness, and the need for the
modification has been reviewed at least
quarterly. Many commenters stated that
allowable modifications should be
limited to the requirements pertaining
to access to food and lockable doors.
Several commenters stated that the only
appropriate reason to modify any of the
listed conditions would be to address
safety needs, and several recommended
a revision to this subsection of the rule.
However, other commenters stated that
there is no reason for an exception/
modification under any circumstances
for many of the requirements and have
recommended revisions to the
regulation.
Response: We agree with the
commenters that the basis for
modifications should be justified
through the person-centered planning
process. The service provider does not
lead the person-centered service
planning process; it is driven by the
individual and includes people chosen
by the individual. We have revised the
rule to require that any modification to
the additional conditions under
§ 441.710(a)(1)(vi)(A) through (D) must
be supported by a specific assessed need
and justified in the person-centered
service plan. We also delineated specific
requirements to support that
justification as well as expectations for
the intervention.
Comment: Several commenters asked
how frequently the assessment must be
made if the condition causing the
modification of the ‘‘additional
conditions’’ was not likely to improve.
One commenter recommended that
CMS amend the current language to
clarify that the specific assessed need
must be of the individual, and should
indicate that a determination has been
made regarding the timeframe that the
modification of conditions will be in
effect.
Response: Per the response to the
previous comments, we have revised the
rule to require that any modification to
the additional conditions under
§ 441.710(a)(1)(vi)(A) through (D) must
be supported by a specific assessed need
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and justified in the person-centered
service plan. We also state in the rule
that reviews and any needed revision of
the independent assessment and the
person-centered service plan, must
occur at least every 12 months, when
the individual’s circumstances or needs
change significantly, and at the request
of the individual.
Comment: Several commenters stated
that CMS should not allow any
departures from or modifications to the
conditions.
Response: We disagree as there may
be reasons why a modification of the
conditions may be necessary.
Comment: One commenter offered
general support of the proposed
language’s intent and believes that the
‘‘legally enforceable agreement’’
condition should never be limited, or
modified.
Response: We appreciate the
commenter’s support and concern.
While the final rules maintain the
ability for a provider to modify this
condition, we have added that this must
be supported by a specific assessed need
and justified in the person-centered
service plan and delineated specific
requirements to support that
justification.
Comment: Several commenters stated
that CMS should clarify that all settings
in which the individual does not have
a regular lease or full ownership
(including adult foster care settings) be
considered provider-controlled.
Response: For the purposes of this
rule, a setting is considered providerowned or controlled, when the setting
in which the individual resides is a
specific physical place that is owned,
co-owned, and/or operated by a
provider of HCBS.
Comment: Several commenters
suggest that CMS clarify that all settings
that require individuals to automatically
transfer their income to service
providers for the purpose of SSI/SSDI or
other disability payments are not HCB
settings for purposes of the Medicaid
program.
Response: Room and board is not
covered under Medicaid state plan
HCBS. This rule does not specify how
payment for room and board should be
made.
Comment: One commenter expressed
that all requirements listed for providerowned or controlled settings should be
a part of the final rule. The commenter
also indicated concern that the example
given in the rule creates the impression
that addressing safety needs of persons
with dementia is only one of many
possible examples of how conditions
might be modified.
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Response: This was only intended as
one example of this provision and is not
depicting a full range of possible
situations. To avoid confusion, and to
clarify that person-centered planning is
based on the person and not on his/her
diagnosis, we have deleted this example
from the regulation text.
Comment: One commenter stated that,
in addition to the provisions at
§ 441.530(a)(1)(vi) and
§ 441.530(a)(2)(v), other provisions can
be used to ensure that the settings in
which residents receive 1915(k) CFC
services are designed to facilitate the
actual integration of the residences that
are provider-owned or controlled for
providing residential support to
recipients.
Response: We agree with the
commenter. For a setting proposed
under 1915(k) CFC to be determined
home and community-based, the setting
must meet all requirements set forth in
§ 441.530.
Comment: One commenter urged
CMS to give serious consideration to
striking the ‘‘conditions for providerdriven setting’’ provision. The
commenter stated that though the rules
attempt to create a homelike
environment by proposing conditions,
no reasonable person would accept
these conditions as homelike. In
addition, the commenter stated that
regardless of the size of a provider
controlled setting, the very nature of
these environments isolates, congregates
and segregates the individuals living
there, and limits personal freedom.
Response: We disagree. We believe
there are provider-owned or controlled
settings that not only meet the overall
HCB qualities but also meet the
additional conditions and allow for full
integration into the community;
therefore, we will keep the conditions to
ensure the standards for HCB settings
are met. We believe the commenter’s
request to delete the conditions for
provider-controlled settings would not
accomplish the suggested purpose.
Comment: Several commenters
suggested that CMS consider giving
human rights reviewing committees the
added responsibility of reviewing
modifications, and requiring a clear
appeals process for any individual who
does not agree to the conditions.
Response: We have amended the
regulations to include a requirement for
informed consent and we specified that
any modification of the additional
conditions must be supported by a
specific assessed need and justified in
the person-centered service plan. We
will add further descriptions in future
guidance.
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Comment: Several commenters
request that CMS specify the
requirements for provider-controlled
settings so that providers and
developers get the message that facilities
cannot be built or established that are
not the most integrated settings.
Response: We believe that all home
and community based settings should
be integrated into and allow access to
the greater community and our
regulation already outlines additional
criteria that must be met to qualify as a
home and community-based setting
where the setting is provider-controlled.
Adding further criteria may be too
prescriptive and could limit individual
choice of settings.
Comment: A few commenters believe
the proposed regulations would
eliminate or severely restrict HCBS in
group homes for people with disabilities
in which providers have adopted
reasonable policies governing their
operation designed to respect the
individual’s rights and at the same time
respect the rights of other residents.
Response: Based on our experience
and significant public input, we believe
we must set minimum additional
conditions for provider-owned or
controlled settings to ensure that they
are home and community-based. The
commenters did not indicate which
conditions would result in this impact,
nor provide suggestions for minimum
conditions to meet the intent of this
provision of the rule. In an effort to
address the concerns raised by
commenters who feared loss of current
residential options and the subsequent
displacement of the individuals living
in such settings who receive HCB
services and the concerns raised by
other commenters who urged us to draw
an immediate and clear line of
demarcation for HCBS, we will permit
states to propose transition plans for
existing approved HCBS under 1915(i)
in accordance with section
441.710(a)(3). While our expectation is
that states would transition to
compliance with this final rule in as
brief a period as possible, we will allow
states to propose a transition plan that
encompasses a period up to five years
after the effective date of the regulation
if the state can support the need for
such a period of time. States are
expected to demonstrate substantial
progress toward compliance throughout
any transition period.
Comment: One commenter believes
the proposed regulations are biased
against provider-owned or controlled
residential settings through the
proposed imposition of additional
regulatory conditions on such settings.
The commenter believes that many
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provider-owned residential settings are
developed to assist with improving the
availability of accessible and affordable
housing so that individuals with
developmental disabilities have some
choice in community housing options
and can avoid the need for unnecessary
institutionalization.
Response: We believe that it is
appropriate to specify additional
conditions for provider-owned or
controlled settings to ensure that all
individuals receiving HCBS are afforded
the opportunities that are characteristic
of living in the community.
Comment: A few commenters stated
their belief that the focus should not be
on the setting, but rather an individual’s
choices and the person-centered service
plan. The commenter stated that
arbitrary geographic or location specific
criteria are not appropriate, and if a
provider-based setting can meet all of
the criteria in § 441.530(a)(1) or
§ 441.710(a)(1), it should not matter
where the provider is located.
Response: We agree with these
comments and believe the regulatory
language at § 441.530(a)(1) and
§ 441.710(a)(1) achieves this purpose.
Comment: One commenter applauds
use of the more general term ‘‘providerowned or controlled residential
settings,’’ but since CMS is creating a
new technical term defining a class of
services, it would be prudent to offer
clearer regulatory guidance regarding
the reach of such a term. For example,
would an elderly housing project that
included service coordination and other
services be subject to these provisions as
a provider-owned residential setting?
CMS may want to consider limiting this
term to apply to state-licensed or
certified settings to avoid confusion.
Response: We are not defining a class
of services. We are describing the
conditions that provider-owned or
controlled settings must meet to be
considered home and community-based
settings. If the elderly housing project is
provider-owned or controlled, it would
have to meet these additional HCB
setting conditions. We do not believe
limiting the application of the term
‘‘provider-owned or controlled
residential settings’’ to those licensed or
certified by the state is in the best
interests of the individuals served under
the HCBS programs, nor would that
approach be adequate to achieve the
goal of defining the qualities and other
requirements for settings that are home
and community-based.
b. Target Population
The Affordable Care Act added
section 1915(i)(7) to the Act, which
allows states to target the section 1915(i)
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benefit to specific populations. We
proposed that target population(s) may
be based on diagnosis, disability,
Medicaid eligibility groups, and/or age.
States may target services only to
eligible individuals in their chosen
target groups, or provide different
services within the 1915(i) benefit to
different target groups. Due to the ability
to define targeted populations, a state
may now propose more than one set of
section 1915(i) benefits, with each
benefit package targeted toward a
specific population. A state may also
propose one section 1915(i) benefit that
targets multiple populations, and may
offer different services to each of the
defined target groups within the benefit.
Additionally, a state may propose a
section 1915(i) benefit that is not
targeted to a specific population and
instead uses only the needs-based
criteria to establish eligibility for the
benefit. The targeting option does not
permit states to target the benefit in a
manner that would not comply with
section 1902(a)(23) of the Act regarding
free choice of providers, or that
forestalls the opportunity for
individuals to receive services in the
most integrated setting possible.
Therefore, targeting criteria cannot have
the impact of limiting the pool of
qualified providers from which an
individual would receive services, or
have the impact of requiring an
individual to receive services from the
same entity from which they purchase
their housing. For example, we would
not allow states to establish targeting
criteria that would restrict eligibility to
only individuals who reside in
provider-owned and/or operated
settings. If a state elects to target the
benefit to a specific population or
populations, it must still establish
needs-based criteria that individuals
must meet in order to be eligible for
section 1915(i) of the Act services and
the state may also establish needs-based
criteria for individual services within
the benefit. The needs-based criteria
may include specific needs that are
applicable to the targeting criteria, but
may also include general needs that
apply across all of the populations
included in the benefit.
Comment: One commenter requested
that CMS not limit people seeking
mental health treatment.
Response: We believe this commenter
has misunderstood the intent of this
provision of the rule, which does not
allow states to limit number of
participants but allows states the option
to target section 1915(i) of the Act to
specific population types. So in this
example, a state could target a section
1915(i) benefit to individuals with a
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chronic mental illness, but would not be
able to limit or cap the number of
people meeting this target criterion.
Anyone meeting this target criterion,
and also meeting the other eligibility
requirements under section 1915(i) of
the Act, would be eligible to receive any
needed services included in the state’s
benefit.
Comment: A couple of commenters
pointed out that the reference to target
criteria in § 441.656(b)(2) of this section
was incorrect.
Response: We thank the commenters
for noting this error and we have
corrected this reference so that it now
reads as ‘‘§ 441.710 (e)(2).’’
Comment: Two commenters
expressed concern that allowing
multiple target groups within one
1915(i) state plan HCBS benefit might
result in a net reduction of service
availability, and lead to institutional
care. One ‘‘fears that the blending of
target audiences’’ will ‘‘leave the
voiceless minority without access to
adequate services.’’
Response: As an optional approach
available to states, this option is not
intended to restrict or compromise
service availability. States can choose
which services they will offer under a
1915(i) State plan benefit, regardless of
whether they take up the additional
option to target a population(s). As with
all state plan services, states must offer
all needed services that they choose to
include under their benefit to all who
are eligible.
Comment: One commenter expressed
concerns that allowing states to serve
multiple target populations in one
benefit will lead to states serving
‘‘incompatible populations in the same
service setting.’’ They cited examples in
states where individuals with one type
of disability were harmed by others with
a different disability, and requested
CMS to expressly prohibit states from
serving different populations in the
same location.
Response: This section of the
regulation does not speak to combining
different target groups in the same living
situations, but rather the inclusion of
multiple target groups in the overall
benefit design and operation. Including
multiple target groups in one benefit
will not alleviate responsibilities of
States for quality assurance and
detailing their quality improvement
strategies for that benefit.
Comment: A few commenters
indicated that we should explicitly state
that ‘‘a state may propose more than one
set of section 1915(i) of the Act benefits,
with each benefit package targeted
toward a specific population’’ and that
the state may also target multiple
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populations under one set of benefits or
offer different services to each of the
defined target groups within the benefit.
Response: Under § 441.710(e)(2)(ii) of
the regulation text, we specify ‘‘The
State may elect in the State plan
amendment to limit the availability of
specific services defined under the
authority of § 440.182(c) or to vary the
amount, duration, or scope of those
services, to one or more of the group(s)
described in this paragraph.’’ In the
preamble to the proposed rule, we
stated ‘‘Due to the ability to define
targeted populations, a state may now
propose more than one set of section
1915(i) benefits, with each benefit
package targeted toward a specific
population. A state may also propose
one set of section 1915(i) benefits that
targets multiple populations, and may
offer different services to each of the
defined target groups within the benefit.
Additionally, a state may propose a
section 1915(i) benefit that does not
choose non-application of comparability
and instead uses only the needs-based
criteria to establish eligibility for the
benefit.’’ A change to the regulation text
is not necessary but we will include this
information in future guidance.
Comment: One commenter recognized
the benefit of the targeting option as
‘‘many states will not consider the State
Plan HCBS benefit if it does not include
mechanisms to control costs, especially
given this existing economic climate.’’
However, the commenter also noted that
‘‘generally systems should be designed
to promote community access over
institutional access, regardless of
individuals’ presenting characteristics.’’
Response: We agree with this
commenter and note that the ability to
target the benefit to specific populations
is a state option afforded by section
1915(i) of the Act, and thus, not
something being made available solely
through this regulation.
Comment: A couple commenters
noted that § 441.656(e)(2)(ii) references
‘‘§ 440.182(b)’’ which should be
referenced as § 440.182(c).
Response: We thank the commenters
for noting this error and have corrected
this reference at § 441.710(e)(2)(ii) so
that it now references services defined
under the authority of § 440.182(c).
Comment: A couple of commenters
requested that the regulation explicitly
state in § 441.656(e) that states may
propose a section 1915(i) benefit that
‘‘does not choose non-application of
comparability and instead uses only the
needs-based criteria to establish
eligibility for the benefit.’’
Response: Revision to regulatory text
is not needed as § 441.710(e)(2) already
specifies that disregarding
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comparability is a State option: ‘‘In the
event that a State elects not to apply
comparability requirements:* * *’’ And
§ 441.715 specifies the requirement that
States establish needs-based criteria for
determining an individual’s eligibility
under the State plan for the HCBS
benefit.
6. Needs-Based Criteria and Evaluation
(§ 441.715) (Proposed § 441.659)
Section 1915(i)(1)(A) of the Act
requires states to establish needs-based
criteria for eligibility for the State plan
HCBS benefit. Institutional level of care
criteria must be more stringent than the
needs-based criteria for the State plan
HCBS benefit. Additionally, the state
may establish needs-based criteria for
each specific State plan home and
community-based service that an
individual would receive.
Comment: Some commenters
supported the use of needs-based
criteria in determining eligibility for
State plan HCBS. Several also expressed
appreciation of the statutory
requirement that a state notify CMS and
the public 60 days in advance of any
proposed restriction on the needs-based
eligibility criteria (adjustment
authority), if the number of individuals
enrolled in the benefit exceeds the
projected number submitted annually to
CMS. These commenters agreed that
notification to CMS should take the
form of a State plan amendment.
Response: We appreciate these
comments supporting this provision of
the rule.
Comment: A couple of commenters
suggested that CMS clarify that a 60-day
public notice be required for any
changes in need-based criteria, as well
as any related level of care changes, and
to include notifying the individual and
any authorized representative. They also
requested that this notice include
guidance for states on the individual’s
appeals rights and stipulate that appeals
information must be included in
communications to individuals. A
couple of commenters also
recommended a formal comment
period, to provide an established
mechanism for public input on the state
proposed modification prior to federal
action.
Response: Section 441.715(c)(1)
requires states to provide at least 60
days notice of a proposed modification
of the needs-based criteria to the
Secretary, the public, and each
individual enrolled in the State plan
HCBS benefit. In addition,
§ 441.715(c)(5) requires any changes in
service due to the modification of
needs-based criteria under the
adjustment authority to be treated as
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actions as defined in § 431.201 and
these actions are subject to the fair
hearing requirements of part 431
subpart E of this chapter. States are also
required under § 431.12 to provide for a
medical care advisory committee to
advise the Medicaid agency director
about health and medical care services,
and the committee must have the
opportunity for participation in policy
development and program
administration. We encourage states to
seek effective public engagement in all
of their Medicaid 1915(i) activities.
Comment: A couple of commenters
recommended a formal comment
period/participant notice be required
when a state proposes to change its
level-of-care criteria for institutional
care.
Response: Criteria for institutional
care (level of care) are set by states as
a means to determine an individual’s
medical necessity for a service. These
criteria are state policy, not approved by
us, and not articulated in the Medicaid
State plan, so we do not have an
opportunity to require notice or
comment periods. States could adopt
their own notice and comment
requirements. We note that to the extent
a change in level of care would affect
access to Medicaid services, states are
required to notify beneficiaries and
provide an appeal process. We may
review state institutional level of care
criteria, for example, to determine if
stringency requirements are met in
considering a state plan amendment to
establish the State Plan HCBS benefit
under section 1915(i) of the Act. Such
review is for approval of the proposed
benefit, not approval of the level of care
criteria, and our review does not reopen
state level of care policy for public
comment.
Comment: A couple of commenters
recommended that we change ‘‘will’’ to
‘‘may’’ in the proposed regulatory
language so that CMS will retain some
discretion to adapt to unexpected
circumstances.
Response: We agree with this
recommendation from commenters.
This sentence in the regulation at
§ 441.715(c) now reads ‘‘The Secretary
may approve a retroactive effective date
for the State plan amendment modifying
the criteria, as early as the day following
the notification period required under
paragraph (c)(1) of this section, if all of
the following conditions are met . . .’’
Comment: One commenter
recommended that the 60 day written
notice to the Secretary (for proposals to
revise needs-based criteria) be provided
at the same time as tribal notice is made,
60 days in advance of submission of the
State plan amendment.
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Response: We acknowledge the
comment with the following reminders:
§ 430.16 provides the Secretary 90 days
to approve or disapprove a State plan
amendment, or request additional
information. If the state implements the
modified criteria prior to the Secretary’s
final determination with respect to the
state plan amendment, the state would
be at risk for any actions it takes that are
later disapproved. Further, Section
5006(e) of the American Recovery and
Reinvestment Act of 2009 (Recovery
Act), Public Law 111–5, codified at
section 1902(a)(73), requires states to
solicit advice from tribes and Indian
Health Programs prior to the state’s
submission of any Medicaid or CHIP
State plan amendment likely to have a
direct effect on Indians, Indian Health
Programs, or Urban Indian
Organizations. The statutory
requirement is that states must solicit
this advice prior to submission of a SPA
or waiver to CMS following the process
described for soliciting advice from
Indian Health Providers and Urban
Indian Organizations in each state’s
approved State Plan.
Comment: One commenter requested
revision to § 441.659(b) to specify that
there it is not a requirement that
institutional or home and communitybased waiver criteria be higher than
their level prior to implementing the
State plan HCBS benefit.
Response: We are unable to make this
revision as it is would not comport with
section 1915(i)(1)(B) of the Act, which
requires needs-based criteria for receipt
of services in nursing facilities,
intermediate care facilities for
individuals with intellectual
disabilities, and hospitals, or waivers
offering HCBS, to be more stringent than
the needs-based criteria for the State
plan HCBS benefit.
Comment: One commenter indicated
that their state is attempting to further
change the Medicaid institutional level
of care criteria to restrict Medicaid
eligibility to the lower need individuals
in several categories of settings,
including the HCBS setting, and
expressed concern about how the
federal proposal would intersect with
this state proposal, and whether the
criteria would align, be duplicative, or
conflicting.
Response: In order to implement and
maintain section 1915(i) State plan
HCBS, the state’s institutional level of
care criteria must be more stringent than
the needs-based criteria for the State
plan HCBS benefit.
We note that there are issues for states
to consider other than section 1915(i) of
the Act that will influence decisions on
levels of care and needs-based criteria,
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that are beyond the scope of this
regulation, for example, statutory
requirements for maintenance of effort
(MOE) in effect at the time of this final
rule, requirements of the ADA and the
Olmstead decision, and funding
constraints. Under section 2001(b) of the
Affordable Care Act, States are not
permitted to establish eligibility
standards, methodologies, or procedures
that are more restrictive than those in
place on the date of the Affordable Care
Act’s enactment (March 23, 2010). For
adults, this requirement lasts until the
Secretary determines that a health
insurance exchange is fully operational
in the state; for children under the age
of 19, the requirement lasts until
September 30, 2019. Because the
application of LOC requirements for
institutions and HCBS waivers may
have an impact on Medicaid eligibility
for some individuals, we encourage
states interested in using the State plan
HCBS to contact CMS for technical
assistance in meeting these statutory
requirements.
Comment: While several commenters
expressed support for grandfathering of
institutional and waiver participants
when states increase stringency for
institutional level of care, they also had
concerns that the stringency
requirements might be interpreted to
allow a state to change the needs-based
criteria between the institutional and
waiver level of care and the state plan
home and community-based level of
care with the net effect that people
would not be eligible for either. They
recommended that CMS revise the
regulation to require states to
grandfather HCBS participants who
would lose Medicaid eligibility due to
‘‘stringency’’ adjustments. Two other
commenters also noted that CMS
misinterpreted the statute where it
specifies that FFP ‘‘shall’’ continue to be
available, as a state option stating their
belief that this indicates a state
requirement and not an option.
Response: The statute at section
1915(i)(5) of the Act does not create a
mandate for states to continue to
provide assistance to such individuals
and to claim FFP. The statute permits
states the option to continue receiving
FFP for individuals who are in an
institution or HCBS waiver, if a state
needs to modify section 1915(i) needsbased criteria after implementation of a
section 1915(i) benefit, and also needs
to modify institutional needs-based
criteria in order to meet the 1915(i)
stringency requirement. Therefore, we
have not adopted this change as
requested to regulation text language at
§ 441.715(b)(2). However, we note that
other legal provisions, such as those
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related to discharge planning, might
require the continued provision of
certain services to individuals.
Comment: One commenter
recommended deletion of the provision
at proposed § 441.659(c)(4)(ii). The
commenter believes that the HCBS
population has predictable fluctuations
in status and therefore the
grandfathering provision should be
flexible enough to protect individuals
who go through short-term transitions.
Response: We disagree with this
recommendation and have not made
this revision as requested. Section
441.715(c)(4)(ii) is an important
provision that requires states, when they
revise needs-based criteria after
implementation of the benefit
(adjustment authority), to continue
providing State plan HCBS to
individuals who were eligible prior to
the change but no longer meet the state’s
new needs-based criteria until such time
as they no longer meet Medicaid
eligibility requirements or eligibility
requirements to be served under the
state’s section 1915(i) benefit.
Comment: One commenter
recommended that CMS define the term
‘‘independent’’ in the regulation.
Response: This is defined at
§ 441.730. Section 441.715 already
indicates that an agent (who performs
the evaluation) must be independent
and qualified as defined in § 441.730.
Comment: A couple of commenters
commended the inclusion of a
requirement at § 441.659(d)(3) to consult
with the individual, but recommend
this be defined and strengthened to
include a more central role for the
individual, including for example
consultation with providers, social
service staff, or others identified by the
individual. Another requested
§ 441.659(d)(3) be changed to reflect that
the person-centered service plan should
have the person ‘‘directing’’ the plan
whenever possible and suggested that if
the individual wishes, other people of
the individual’s choice be consulted.
Response: This section of the rule
pertains to the independent evaluation
to determine eligibility. Therefore, we
do not believe it is necessary to include
requirements about the person-centered
service planning process, for which
there are separate regulations at
§ 441.725(a) and which already reflect
the recommendations of this
commenter.
Comment: A couple of commenters
noticed that § 441.659(b)(2) includes an
incorrect reference to (c)(7).
Response: We have corrected the text
in § 441.715(b)(2) of the final rule to
change the reference from (c)(7) to (c)(6).
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Comment: One commenter noticed
that § 441.659(d) incorrectly references
§ 441.656(a)(1) through (5), and that
§ 441.659(d)(2) incorrectly references
§ 441.656(a)(1) through (3) and (b)(2).
Response: In § 441.715(d), we have
corrected the reference so that it now
reads as § 441.715. In § 441.715(d)(2),
we have also revised the reference so
that it now reads correctly as § 435.219
and § 436.219.
Comment: One commenter requested
that we eliminate the word ‘‘eligibility’’
from § 441.659 and replace it with
‘‘services’’ to eliminate confusion so
that eligibility would be centered on
categorical eligibility while service
criteria were used for needs-based
criteria.
Response: We are unable to make this
requested revision, since needs-based
criteria are necessary for eligibility, in
addition to the other eligibility
requirements specified in § 435.219 and
§ 436.219.
Comment: A couple of commenters
requested that the regulation include an
individual’s inability to perform 2 or
more ADLs or IADLs as a requirement
for eligibility under section 1915(i) of
the Act.
Response: This is not an eligibility
requirement under the statute and we
are not able to make this requested
revision. While 1915(i)(1)(F)(i) requires
that the independent assessment
include an objective evaluation of an
individual’s inability or need for
assistance to perform 2 or more ADLs,
this is only a suggested element at
1915(i)(1)(D)(i) and thus, not required
for an individual to be determined
eligible for 1915(i) State plan HCBS.
Comment: One commenter requested
that we add a provision to
§ 441.659(d)(3) to include consultation
with the parents of a child.
Response: We believe that the broader
term ‘‘individual’s authorized
representative,’’ used in 1915(i) of the
Act and in this regulation, would
include, in the case of a child, the
child’s parents or legal guardian, and
does not need to be explicitly stated in
regulation.
Comment: Another commenter
recommended that when assessing the
individual’s support needs for purposes
of evaluation of eligibility, that informal
supports arranged by the individual not
be considered unless the individual
explicitly chooses to include them.
Response: This suggestion is already
captured in § 441.720(a)(2) where the
regulation requires the assessment to
‘‘…include the opportunity for the
individual to identify other persons to
be consulted, such as, but not limited to,
the individual’s spouse, family,
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guardian, and treating and consulting
health and support professionals
responsible for the individual’s care.’’
Comment: A couple of commenters
stressed the importance that FFP be
available for evaluations even when an
individual is subsequently found
ineligible for section 1915(i) of the Act
services.
Response: As stated in section
III.N.2.of the preamble to the proposed
rule, FFP is available for evaluation and
assessment as administration of the
approved state plan prior to an
individual’s determination of eligibility
for and receipt of other section 1915(i)
of the Act services. If the individual is
found not eligible for the State plan
HCBS benefit, the state may claim the
evaluation and assessment as
administration, even though the
individual would not be considered to
have participated in the benefit for
purposes of determining the annual
number of individuals served by the
benefit.
Comment: Some commenters
requested clarification regarding level of
need, as defined by the state and
provider, including whether a state may
leverage existing and/or specific
instruments that are used to determine
HCBS waiver eligibility in order to
determine whether a beneficiary meets
the State plan HCBS needs assessment
criteria for participation, understanding
that the State plan HCBS benefit
eligibility criteria must be less stringent
than that used for HCBS waiver
programs.
Response: The state’s process for
determining eligibility must meet the
requirements at § 441.715(d). We do not
require a specific instrument(s) that
states must use in meeting these
requirements.
Comment: One commenter indicated
that if states establish needs-based
criteria for each specific service that an
individual receives, it would add to the
complexity of the assessment service
planning, the overall costs of program
administration, and potential
beneficiary and family caregiver
confusion. They stressed that such
variability in Medicaid across states
could become extremely difficult to
track and monitor.
Response: As specified in the
regulation, this is optional for states.
This option could be of benefit for states
that wish to include services for
individuals with specific needs within a
section 1915(i) of the Act benefit that is
not targeted to a specific population
group(s) and is designed to provide a
broad array of services.
Comment: One commenter requested
CMS require states to make needs-based
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criteria publicly available, including
public Web site posting. Another
inquired how CMS will maintain
publicly available documents relating to
the state’s modification proposal,
approval and denial letters, comments
submitted and communications with the
state.
Response: We agree that web posting
is an ideal way to make state plans and
amendments available to the public, and
we are building a web-based
information system for all of Medicaid
and CHIP that will provide immediate
access to state plan amendments.
Section 1915(i) of the Act SPAs will be
part of that system. Until then, SPAs are
processed on paper and posted
sometime after approval. We encourage
states to provide for effective public
engagement in all of their Medicaid
program activities, and states are
required to provide 60 day public notice
when states change reimbursement
methodology or revise CMS approved
section 1915(i) needs-based criteria.
7. Independent Assessment (§ 441.720)
(Proposed § 441.662)
Section 1915(i)(1)(E) of the Act
describes the relationship of several
required functions. Section
1915(i)(1)(E)(i) of the Act refers to the
independent evaluation of eligibility in
section 1915(i)(1)(A) and (B) of the Act,
emphasizing the independence
requirement. Section 1915(i)(1)(E)(ii) of
the Act introduces the requirement of an
independent assessment following the
independent evaluation. Thus, there are
two steps to the process: The eligibility
determination, which requires the
application of the needs-based criteria
and any additional targeting criteria the
state elects to require; and the
assessment for individuals who were
determined to be eligible under the first
step, to determine specific needed
services and supports. The assessment
also applies the needs-based criteria for
each service (if the state has adopted
such criteria). Like the eligibility
evaluation, the independent assessment
is based on the individual’s needs and
strengths. The Act requires that both
physical and mental needs and
strengths are assessed. We note that
while section 1915(i)(1)(F)(i) of the Act
requires that the independent
assessment include an objective
evaluation of an individual’s inability or
need for assistance to perform 2 or more
ADLs, this is only a suggested element
at section 1915(i)(1)(D)(i) of the Act and
thus, not required for an individual to
be determined eligible for 1915(i) State
plan HCBS.
These requirements describe a personcentered assessment including
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behavioral health, which will take into
account the individual’s total support
needs as well as the need for the HCBS
to be offered. Section 1915(i)(1)(E)(ii) of
the Act requires that states use the
assessment to: determine the necessary
level of services and supports to be
provided; prevent the provision of
unnecessary or inappropriate care; and
establish a written individualized
service plan.
To achieve the three purposes of the
assessment listed above, the assessor
must be independent; that is, free from
conflict of interest with regard to
providers, to the individual and related
parties, and to budgetary concerns.
Therefore, we proposed specific
requirements for independence of the
assessor in accordance with section
1915(i)(1)(H)(ii) of the Act, and we will
apply these also to the evaluator and the
person involved with developing the
person-centered service plan, where the
effects of conflict of interest would be
equally deleterious. These
considerations of independence inform
the discussion below under section
1915(i)(1)(H)(ii) of the Act regarding
conflict of interest standards.
Comment: Many commenters
expressed support of the independent
assessment requirements in this section
of the rule. One commenter who
expressed agreement with
§ 441.662(a)(1), stated that individuals
with disabilities have a right to choose
their own lifestyle, just like their peers
without disabilities.
Response: We appreciate these
comments and support.
Comment: One commenter stated that
clear assessment standards are
necessary to ensure that individuals
deemed eligible for section 1915(i) of
the Act services receive the services that
are most appropriate and effective.
Response: We agree and have
specified these requirements in
§ 441.720.
Comment: A commenter requested
that we ensure there are assessments of
need for individuals residing in facilitybased settings before the development of
their person-centered service plans.
Response: The requirements of this
regulation pertain to all section 1915(i)
of the Act eligible and enrolled
individuals residing in home and
community-based settings, regardless of
the setting.
Comment: One commenter stated
concern that § 441.662(a)(1)(i)(A) refers
to ‘‘health care professionals,’’ given
that often assessments of support
needs—such as the Supports Intensity
Scale and functional-behavioral needs
assessments—are made by case
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managers or social workers, rather than
health care professionals.
Response: As enrolled Medicaid
providers of Medicaid services or
administrative activities, case managers
and social workers are included in our
regulation as ‘‘health care
professionals.’’
Comment: A couple of commenters
requested that CMS add to paragraph
(a)(2) ‘‘friends’’ as respondents that the
individual may identify to participate in
the assessment. They also commented
that this paragraph should require that
the assessor actually contact and
involve individuals identified.
Response: We do not believe it is
necessary to add an exhaustive list of all
the examples of the persons that an
individual participant may choose to
include in this process. The requirement
specifies a few examples but
emphasizes that these are just examples
and not a limitation.
Comment: A couple of commenters
requested clarification in § 441.662
(a)(4) on the requirements for a caregiver
assessment, including what it means,
the process, and purpose. Another
commenter suggested its removal,
stating that it unnecessary since there is
already an assurance elsewhere in the
regulations that states must assure the
enrollees’ health and welfare. However,
many others expressed their support of
this provision and stressed the
importance of its inclusion in the
regulation; some even urged CMS to
include this under other Medicaid
HCBS authorities. One of these
commenters requested the addition that
the caregiver assessment will assess the
training, support and respite needs and
identifying options for receiving these
services. Another stated that the
assessment should evaluate the
caregiver’s well-being, needs, strengths
and preferences, as well as the
consequences of caregiving on the
caregivers.
Response: We included this provision
in the proposed rule as a result of
comments received in response to the
first proposed rule pertaining to section
1915(i) of the Act, which was not
finalized. Those commenters stated that
taking into account the capacity of
primary caregivers to provide for the
individual’s assessed needs is
necessary, and some stated that natural
supports often have declining capacity,
and to fail to take this into account leads
to unrealistic plans. We agree that when
caregivers are being relied upon to
implement the person-centered service
plan, it is important that a caregiver
assessment be required in order to
acknowledge and support the needs of
informal family caregivers. We agree
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that caregivers provide critical care and
support that enables individuals to live
in their homes and communities. When
there is a caregiver involved, an
assessment of the caregiver’s needs is
essential to facilitate the individual’s
linkage to needed supports. We
appreciate the comments regarding
definition and process, which we will
consider for future guidance.
Comment: Many commenters
requested that CMS add language to the
rule that specifically addresses
assessment of needs related to cognitive
impairment. A couple of commenters
noted that this is needed to promote
early diagnosis of memory problems and
prevent the cycle of under-diagnosis
and misdiagnosis of Alzheimer’s
disease. They stated that many
individuals with dementia need
supervision and cueing or are unable to
perform instrumental activities of daily
living. Others expressed support of a
more comprehensive approach to
include social, medical, behavioral,
emotional, physical and cognitive
strengths and challenges, and also noted
that on-going training and coaching in
understanding cognitive and behavioral
issues unique to brain injury in the
planning process should be a part of the
delivery system. They stated that CMS
and states will need to work with
program participants and community
advocates to determine the appropriate
depth of assessment, allowing for an
informed planning process while also
being respectful of some individuals’
desire for a non-intrusive approach.
They also noted that a range of
professionals may be suitable for
assessing cognitive as well as behavioral
issues, including neuropsychologists,
psychologists trained in brain injury,
educators, and speech and language
therapists.
Response: We agree with these
comments and have added ‘‘cognitive’’
to § 441.720(a)(4).
Comment: One commenter expressed
support of the requirement for a personcentered assessment process.
Response: We agree that this is
essential to the assessment and personcentered service planning process.
Comment: One commenter stated that
it would be helpful for providers and
practitioners to have a degree of
flexibility in prioritization and to
override recommendations for lower
levels of care. They noted that this
could be kept at a particular level (that
is, no more than 5 percent of the time),
but there are certain conditions and
situations that can result in skewed
assessment results.
Response: We do not agree with this
comment. We do not believe it would be
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consistent with the intent of this subsection, or with the person-centered
process requirements at § 441.725, and
would enhance the potential for conflict
of interest.
Comment: A few commented on the
statutory requirement regarding
assessment of an individual’s inability
to perform two or more ADLs. One
suggested that the assessor also consider
cueing as assistance, whether by
someone, a device or service animal in
addition to individual assistance or
assistive technology. Another stated that
the statute does not set any specific
needs-based or ADL criteria as a
standard for eligibility for any HCBS,
and that CMS should clarify that states
should not interpret the two ADLs
evaluation criteria in the assessment to
mean that two ADLs is the standard for
eligibility for the state plan option or for
any specific services under the state
plan option. One commenter
recommended that CMS clarify in the
preamble that while ADL review is a
required element of the assessment, the
result of the ADL review cannot be a
litmus test for access to services.
Response: An objective evaluation of
the individual’s inability to perform two
or more ADLs is, in statute, a required
element of the independent assessment
but it is only a permissible element of
the independent eligibility evaluation.
The statute does not specify that
eligibility for state plan HCBS must be
based on the evaluation of the
individual’s inability to perform a
minimum number of ADLs. We
concluded that partial or complete
inability to perform two or more ADLs
is not a statutory prerequisite to
eligibility for State plan HCBS.
However, the evaluation of an
individual’s inability to perform two or
more ADLs, as required under section
1915(i)(1)(F)(i) of the Act, is related to
the state’s responsibility under section
1915(i)(1)(E)(ii) of the Act to use the
results of the assessment to determine a
necessary level of services and supports,
prevent the provision of unnecessary or
inappropriate care, and establish an
individualized care plan.
Comment: Some commenters
recommended that in-person
assessments be required or,
alternatively, that telemedicine
assessments be allowed only in very
limited circumstances when in-person
assessments cannot practically be
performed. Other commenters agreed
that it may be appropriate to use
technology to conduct assessments in
certain circumstances, such as for
individuals in rural or underserved
areas, but not for beneficiaries for whom
such circumstances do not create
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barriers to an in-person and in-home
assessment. They suggested additional
language to limit use of technology to
conduct assessments to individuals in
rural areas, or other special
circumstances by requiring states to
make an individualized determination
of the need for substituting telemedicine
for genuinely in-person assessments.
One commenter stated that it should
only be allowed if the state makes an
individualized determination of the
need for substituting telemedicine for
genuinely in-person assessments.
Another stated that assistive technology
or other alternative or augmentative
communication should be made
available for those who would benefit
from it. A few commenters stated that
§ 441.662(a)(1)(i)(B) should include, if
the individual wishes, the presence of
family, a peer/parent support provider,
or other people of the individual’s
choice.
Response: In our preamble to the
proposed rule, we indicated that we
added this provision of the regulation in
recognition that many states are
developing infrastructure and policies
to support the use of telemedicine and
other ways to provide distance-care to
individuals in order to increase access
to services in rural areas or other
locations with a shortage of providers.
However, we are concerned that by
limiting this technology to only these
circumstances, the regulation may end
up precluding instances where it may be
useful, maybe even essential. Therefore,
we are not adding this limitation to the
regulation, but will include this
example in future guidance and monitor
its use by states. We also note that these
requirements do not override the other
requirements for the assessment in this
section, including the person-centered
process and consultation with persons
that the individuals choose to include.
Comment: A couple of commenters
stated that § 441.662(a)(7) regarding
habilitation services specifies that only
Section 110 of the Rehabilitation Act of
1973 and the Individuals with
Disabilities Education Improvement Act
of 2004 are primary payors and that
(a)(8) should require documentation
indicating that State plan HCBS also
available through other Medicaid
services or other federally funded
programs, will not be provided:
‘‘No State plan HCBS are provided
which would otherwise be available in
the same amount, scope, and duration to
the individual through other Medicaid
services or other federally funded
programs available under Section 110 of
the Rehabilitation Act of 1973 and the
Individuals with Disabilities Education
Improvement Act of 2004.’’
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Response: We do not agree with this
suggested addition. The broader
requirement of this provision ensures
that if the same services are available
through other sources, then State plan
HCBS would not be provided. Adding
the suggested clause would leave the
possibility for a state to claim FFP for
a service through section 1915(i) of the
Act before or instead of claiming it
through these other authorities/
programs. Since the intent of this
provision is to ensure that states only
claim for State plan HCBS when they
are unavailable through other sources,
we are unable to incorporate the
language requested.
Comment: A couple of commenters
recommended adding a modification so
that § 441.662(a)(8) would require that
the services be ‘‘immediately’’ available
to the individual.
Some commenters stated concern that
a state might deny an individual’s
ability to choose to receive a service
through the section 1915(i) of the Act
benefit, if that service would be
theoretically available under another
federal program but the fact that the
individual was not provided with
assistance in applying for those services
would result in delayed access to
services or no access to services. They
instead proposed a ‘‘no wrong door’’
policy in enrolling individuals in the
section 1915(i) of the Act State plan
benefit, so that regardless of their
eligibility status for services under other
programs the individual begins
receiving the services they are
determined to need through their
individualized assessment without
having to apply or complete additional
eligibility determinations. They also
stated that individuals should be able to
utilize the program that best meets their
needs and preferences, and provides for
the greatest degree of service
coordination and administrative
simplification.
Response: We developed the
requirements at § 441.720(a)(7) and (8)
due to concern over duplication of
habilitation services and other statedefined services. Additionally, since
some individuals may be
simultaneously receiving services
through a HCBS waiver and the section
1915(i) benefit, we require in
§ 441.720(a)(9) documentation that the
services provided through section
1915(c) and section 1915(i) of the Act
authorities are not duplicative for the
same individual. This will also include
coordination of assessments, personcentered service plan development, and
case-management to ensure that
individuals receiving services under
both authorities are not subject to
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multiple assessments and personcentered service plans. We believe the
term ‘‘available,’’ addresses the concern
and revision is unnecessary.
Comment: A commenter asked
whether individuals would be required
to utilize the State plan HCBS benefit
first, when those services are
duplicative of services also offered
under a HCBS waiver for which that
individual is eligible, such as
habilitation services.
Response: The determination of how
such services would be provided must
be made during the development of the
person-centered service plan.
Additionally, if the State plan HCBS
will provide the same amount, duration,
and scope of service as another covered
Medicaid service, states must explain in
their proposed SPA how they will
ensure against duplication of service
and payment.
Comment: Several commenters
expressed support of the requirement
for the assessment to be conducted ‘‘in
consultation with the individual, and if
applicable, the individual’s authorized
representative, and include the
opportunity for the individual to
identify other persons to be consulted,
such as, but not limited to, the
individual’s spouse, family, guardian,
and treating and consulting health and
support professionals responsible for
the individual’s care.’’ However, one of
these commenters stated this language
stops short from stating that the
participant has a role in deciding who
participates in the assessment process,
indicating that person-centered
practices require that participants drive
the assessment process, and this
includes decisions pertaining to who is
part of their team when identifying and
addressing unmet need.
Response: We believe this concern is
fully addressed in the section pertaining
to the person-centered planning process
at § 441.725(a), and we have added a
cross reference to this section to
§ 441.720(a)(1).
Comment: A commenter asked
whether states can set limits on amount/
scope/duration of State plan HCBS
benefits, as approved via the State plan
amendment process.
Response: Yes. Section 441.700
specifies that states are to describe the
services that they will cover under the
State plan HCBS benefit, including any
limitations of the services.
Comment: One commenter expressed
that states should have flexibility in
choosing the independent assessor to
serve populations.
Response: States have the flexibility
to determine the entity that can perform
this function, consistent with the
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requirements at § 441.730 regarding
qualifications and § 441.720 regarding
the independent assessment.
Comment: One commenter noted that
they have seen great variability in
assessment results for the same
individual depending on what
incentives staff have for scoring a child
or adult into or out of particular
specialty services. They expressed that
it needs to be clear which care provider
or entity is responsible for completion
of assessment for a particular patient
and, if there are competing assessment
results, which provider’s or entity’s
assessment is prioritized.
Response: We agree, which is why we
emphasized the section 1915(i) of the
Act requirement for conflict of interest
standards at § 441.730(b). When a state
proposes a SPA to add section 1915(i)
of the Act HCBS, we require that the
state specify the entity that will be
responsible for the assessment, the
qualifications of that entity, and how
the state will meet the conflict of
interest requirements at § 441.730(b).
The commenter mentions the presence
of multiple assessments with competing
assessment results, so we further note
that there should be one assessment that
incorporates the findings of any other
records or information needed to
develop the person-centered service
plan as required in § 441.725.
Comment: One commenter asked that
§ 441.662(a)(2) also require that the
assessor actually contact and involve
the individuals identified.
Response: Section 441.720 (a)(1)
requires the assessment to be a face-toface contact with the individual and to
be a person-centered process.
Comment: One commenter stated that
it will be important for CMS and states
to incorporate core elements of
assessment that inform the participant
direction process and at minimum, are
not in conflict with participant-directed
processes. They also stated that
assessment questions should not lead to
premature assumptions pertaining to
who is appropriate for participantdirection simply based on diagnosis, the
availability of informal caregivers, the
individual’s functional need, or
cognitive status. Instead, assessment
questions should be built on an
assumption that all individuals, with
the appropriate level of support, can
participate in some form of participant
direction. Assessment questions should
assist the participant and others
involved in the assessment process to
identify unmet needs and the type of
support that may be beneficial to the
individual to allow for successful
participant direction. In addition to
identifying unmet need (as defined by
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the individual), this could include an
assessment of strengths, abilities,
individual goals, need for a
representative, capacity to self-direct
with an eye for developing a support
system to ensure success in selfdirecting, and risks. For a participant
direction assessment to be successfully
integrated into a larger assessment
process, those performing the
assessment need to be well-informed of
participant direction programs, benefits,
and requirements. Those performing
and overseeing assessment processes
also need training on the difference
between traditional and participantdirected paradigms of service delivery.
State and local leaders need to be
informed, as well as educate their
program staff, of the core competencies
required to effectively support people to
self-direct.
Response: We appreciate these
comments and will consider them in
future guidance that we develop after
final publication of this rule.
Comment: One commenter
recommended that the requirement to
use a ‘‘person-centered process’’ in
§ 441.662(a) cross reference § 441.665,
and suggests the phrase ‘‘. . . and
meeting the requirements of § 441.665’’
be added to the end of § 441.662(a).
Response: We agree with this
recommendation and have added ‘‘that
meets the requirements at § 441.725(a)’’
to § 441.720(a)(1).
Comment: A couple of commenters
requested clarification of the
relationship between the needs-based
criteria that states must establish for
determining eligibility for HCBS, and
for each specific service. One of these
commenters noted that § 441.662(a)(5)
implies that need-based criteria must be
in place for each service and suggested
moving the term ‘‘(if any)’’ to after the
word ‘‘criteria,’’ and editing it to ‘‘(if
any have been established)’’.
Response: We agree with this
suggestion and have revised the first
sentence of § 441.720(a)(5).
Comment: One commenter stated that
clarification is needed regarding the
independent assessment that is
conducted by a qualified health care
professional (suggesting a medical
model approach), and a true personcentered planning process.
Response: We acknowledge that this
term used in this paragraph is
inconsistent with other language in this
regulation, and have revised
§ 441.720(a)(1)(i)(A) accordingly.
Comment: A commenter
recommended that in § 441.662(a)(6)
CMS create a stronger regulation to
promote self-direction of services, and
recommended the term ‘‘any
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information’’ be modified to ‘‘notice, all
information, and any supports.’’
Response: We did not make the
changes requested by this commenter.
This paragraph pertains to what must be
included in the assessment with regards
to self-direction if the State offers this
under the State plan HCBS benefit.
Other requirements regarding selfdirection of services are contained in
§ 441.740.
Comment: Several commenters had
opinions on the frequency requirements
of the assessment. One requested that
CMS expand this to ‘‘at the request of
the individual,’’ as is similarly provided
in the regulation at § 441.665(c).
Another stated that the assessment
should be required every 3 years if
clients are stable and engaged in the
community, to reduce stress on the case
management system. A couple of others
just stated that re-assessments should
occur ‘‘frequently’’ and when an
individual’s support needs or
circumstances change significantly.
Some stressed that the assessment and
re-assessment process should be based
primarily on individual need, and not
place burdensome processes on the
individual. One stated that for
individuals unable to communicate via
spoken, signed, written, or alternative/
augmentative communication, the
regulations should include language
that significant changes in behavior
and/or temperament indicate a need for
reassessment of services. And another
stated that CMS should clarify that the
requirement for reassessment should not
be interpreted to mean that each
individual requires a full-scale medical
re-evaluation, but instead re-assessment
of services currently being used and
new services requested by the
individual or those important to him or
her. One commenter asked how
frequently the assessment must be made
if the individual’s condition is one that
is not likely to improve.
Response: The current regulation
language states ‘‘the re-assessment of
needs must be conducted at least every
12 months and as needed when the
individual’s support needs or
circumstances change significantly, in
order to revise the person-centered
service plan.’’ We believe that this
language captures some of the concerns
noted by the commenters. For others, in
order to accommodate the varying and
sometimes opposing comments, we
believe that we should not change this
requirement as provided in the
proposed rule. This minimum frequency
is consistent with the minimum
frequency requirement for the review of
the person-centered service plan, which
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is based on the statute at section
1915(i)(1)(G)(ii)(III) of the Act.
Comment: Several commenters noted
language from the preamble of the
proposed rule that indicates that an
assessment of ‘‘needs and strengths’’ is
more appropriate than needs and
capabilities, as the words capability and
ability are historically connected with a
deficit oriented approach to assessment.
They requested that CMS add the word
‘‘strengths’’ to § 441.662(a). Some also
requested that the reference to needs in
§ 441.662(a) specifically include
physical and mental health needs
stating that it must be made clear in the
opening paragraph of this sub-section
that these must also be assessed in order
to establish a service plan.
Response: While we agree that these
are elements that must be included in
the assessment process, we believe this
is already captured sufficiently under
§ 441.720 (a)(4) of this section which
states, ‘‘Include in the assessment the
individual’s physical, cognitive, and
behavioral health care and support
needs, strengths and preferences, . . .’’
Therefore, we have not adopted this
change as requested.
Comment: Several commenters stated
the regulation text should also include
the language from the preamble that
indicates that services must be
furnished to individuals with an
assessed need, and must not be based on
available funds.
Response: This was an explanatory
statement of the requirement at
§ 441.677(a)(1)(ii) of the proposed rule,
which is now at § 441.745 (a)(1)(ii) of
the final rule, and is not necessary to
specifically state in regulation.
Comment: Several expressed that the
regulation should include language from
the preamble that states the ‘‘role of the
assessor is to facilitate free
communication from persons relevant to
the support needs of the individual.’’
Response: This is an explanatory
statement in the preamble of the
requirement already included at
§ 441.720(a)(2) regarding consultation
with the individual and if applicable,
the individual’s authorized
representative, and others that the
individual would like to include. We
will plan to include this explanation in
future guidance.
8. Person-Centered Service Plan
(§ 441.725) (Proposed § 441.665)
Section 1915(i)(1)(G) of the Act
requires that the State plan HCBS
benefit be furnished under an
individualized care plan based on the
assessment. The terms ‘‘care plan’’ and
‘‘service plan’’ are used interchangeably
in practice. As explained in the May 3,
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2012 proposed rule (77 FR 2012–10385),
we have adopted the term ‘‘personcentered service plan’’ in this
regulation. To fully meet individual
needs and ensure meaningful access to
their surrounding community, systems
that deliver HCBS must be based upon
a strong foundation of person-centered
planning and approaches to service
delivery. Thus, we proposed to require
such a process be used in the
development of the individualized
person-centered service plan for all
individuals to be served by section
1915(i) of the Act benefit. We proposed
certain requirements for developing the
person-centered service plan, but noted
that the degree to which the process
achieves the goal of person-centeredness
can only be known with appropriate
quality monitoring by the state, which
should include substantial feedback
provided by individuals who received
or are receiving services.
a. Person-Centered Planning Process
§ 441.725(a)
Comment: One commenter requested
that CMS ensure that there is a plan in
place and implemented for more than
medication management for individuals
residing in facility-based settings.
Response: The requirements of this
regulation pertain to all section 1915(i)
of the Act eligible and enrolled
individuals residing in home and
community-based settings, regardless of
the setting.
Comment: One commenter states that
the driver and focus of the personcentered planning process is the
individual and this concept is presented
in § 441.665. However, it is not
referenced at all in the provisions of
§ 441.659 pertaining to needs-based
criteria and evaluation, nor in the
provisions of § 441.662 related to
independent assessment.
Response: The needs-based criteria
established by each state determine an
individual’s eligibility through an
independent assessment and evaluation,
which by its nature, focuses on the
person. The individual does not drive or
control these processes; however, the
individual is the center of this process.
The regulation at § 441.720(a)(1),
regarding independent assessment,
references § 441.725, person-centered
service plan.
Comment: One commenter supports
the expectation that states support
individuals in the planning process as
well as monitor the person-centeredness
of the process itself. The commenter
requests further refinement of the rule to
ensure that program participants and
community stakeholders are actively
engaged in the states’ design of the
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program as well as its ongoing quality
management structure so that personcentered processes can be designed and
monitored with substantial involvement
of stakeholders. The commenter is also
pleased to see that as part of the service
planning process, program participants
(including those not self-directing) will
be offered choices pertaining to the
services and supports they receive. The
commenter requests that specific
examples or guidelines be offered to
states to demonstrate what this choice
may look like within traditional
services.
Response: We agree with the
commenter’s suggestion and will take it
into consideration in developing future
guidance.
Comment: Some commenters stated
that it is important that the regulation
include the statement in the preamble
that indicates that the service plan
‘‘should be constructed in a manner that
promotes service delivery and
independent living in the most
integrated setting possible.’’
Response: It is our expectation that
the person-centered process incorporate
the ideals stated in the preamble and we
believe that this expectation is
expressed in the regulation text at
§ 441.725(b)(1).
Comment: A few commenters
recommended the following revision to
§ 441.665(a)(1), ‘‘Includes people chosen
by the individual, including a parent
and a parent support provider in case of
a child and a youth support provider
when the individual is under the age of
25.’’ A few commenters recommended
the person-centered planning process
allow HCBS providers and other health
care providers to participate in service
plan development and/or be the service
plan developer.
Response: We appreciate the
commenters’ perspective and
suggestions. We do not want to
prescribe all people who may be
included in the planning process since
that action may unintentionally exclude
someone who is chosen by the
individual.
Comment: Several commenters
recommended that § 441.665(a) address
those individuals not able to indicate a
choice of whom they would like to
participate in the person-centered
planning process and that in these
instances, the process should allow
inclusion of people who know and care
about the individual. One commenter
encourages CMS to note the potential
role of family members, peers,
providers, and others during the personcentered service planning for HCBS.
One commenter recommended that
individuals who require assistance in
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making decisions due to profound
cognitive limitations may need the
protection of legally-appointed
guardianship arrangements, preferably
by a family member or another
individual who is familiar with an
individual’s unique needs. In many
instances, it will not be feasible for
service planning for individuals with
brain injury to be furnished by any other
individual or entity. One commenter
encourages the use of advance directives
to assure that a person’s wishes are clear
in the event he/she needs assistance, but
is unable to otherwise express himself/
herself.
Response: We believe that the
regulation text as proposed, and which
we are finalizing at § 441.725(a)(1),
encompasses the suggestions that the
commenter proposes.
Comment: A few commenters
recommended that § 441.665(a) of the
proposed rule should also require that
person-centered service plans include
examples and language referring to
positive strategies to minimize the use
of all types of restraints (chemical,
physical, and mechanical) and other
restrictive procedures.
Response: We have strengthened the
language of this section in the final rule
at § 441.725(b)(13) by indicating that
any modification of the additional
conditions must be justified in the
person-centered service plan and added
specific requirements about what must
be documented in the person-centered
service plan in these instances.
Comment: Several commenters
recommend the following revision to
§ 441.665(a)(2), ‘‘Provides necessary
information, support and experiences, if
needed, to ensure that the individual
directs the process to the maximum
extent possible, and is provided
meaningful opportunity to make
informed choices and decisions.’’ One
commenter requested that the regulation
more clearly state that an individual
must be given information about all
available supports and services.
Response: We believe that the
regulation text at § 441.725(a)(2) is
complete and clear.
Comment: A commenter suggested
that the regulation must more clearly
state that an individual must be given
information about all available supports
and services. The commenter also states
that the individual must be given
complete and accurate information
about his/her right to a fair hearing and
the regulation should require that this
information be provided at every
person-centered planning meeting and
that a simple easy to use form be
provided to request a fair hearing.
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Response: It is our expectation that
during the person-centered planning
process and development of the personcentered service plan, all services and
support options available will be
articulated and discussed with the
individual. States must adhere to the
fair hearing requirements at part 431,
subpart E for all Medicaid programs.
Comment: A few commenters
recommended modifying § 441.665(a)(3)
to read, ‘‘Is timely, flexible, and occurs
at times and locations of convenience to
the individual.’’ One commenter
requested clarification regarding the
standard against which a state’s
‘‘person-centered’’ process will be
reviewed or the timeline for
development of those criteria.
Response: We believe that the
requirement regarding scheduling the
meeting at the convenience of the
individual addresses the flexibility issue
and are not incorporating the suggested
language. The minimum standards for
person centered planning are
enumerated in the regulation.
Comment: Many commenters
recommended that the language in the
regulation text at § 441.665(a)(4) be
revised to include physical, linguistic
and cultural accessibility in the personcentered planning process. One
commenter requested that cultural
considerations be expanded to include
‘‘lifestyle’’ choices of the individual.
Response: We appreciate the
commenters’ suggestions and note that
the regulation text at § 441.665(a)(4)
addresses cultural considerations. We
have added regulation text at
§ 441.725(a)(4) to specify that the
person-centered planning process must
be accessible to persons who are limited
English proficient and persons with
disabilities, consistent with the
Medicaid programmatic accessibility
provision at § 435.905(b). Policy
guidance to promote compliance with
Title VI’s prohibition against national
origin discrimination affecting persons
with limited English proficiency is
available on the Department of Health
and Human Services Office for Civil
Rights Web site at https://www.hhs.gov/
ocr/civilrights/resources/laws/
revisedlep.html.
Comment: Several commenters
suggest inserting language at
§ 441.665(a)(2) such as meaningful
choice, informed decision-making,
provision of meaningful information
about settings, including the most
integrated setting alternatives
appropriate for that individual.
Response: We appreciate the
commenters’ suggestions. While we
have not made any revisions to
§ 441.725(a)(2), we have considered
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these comments for other revisions
made to the regulation.
Comment: Many commenters agreed
with the provision at § 441.665(b)(1)
that the person-centered plan should
record the alternative home and
community-based settings that were
considered by the individual. Another
commenter requested CMS add a
requirement that ‘‘all residents have
selected this setting from a meaningful
choice of alternatives, including the
most integrated setting appropriate for
each resident.’’ One commenter requests
with respect to § 441.665(a)(8), that this
provision should be modified to read,
‘‘Documents how the home and
community-based settings, services and
supports, including both residential and
employment settings and supports, are
in line with the USDOJ most integrated
setting mandate under the ADA and
Olmstead decision, and in cases where
settings and services are not fully
aligned with the ‘most integrated
setting’ mandate, provides full
documentation regarding why less
integrated/congregate settings and
services are being utilized.’’
Response: We appreciate the
commenters’ support. We have
addressed the concern regarding
meaningful choice and most integrated
settings by clarifying that the
individual’s selection must include nondisability specific housing
opportunities. We support the mandates
of the ADA and the Olmstead decision
and believe the final regulation reflects
the spirit of these mandates.
Comment: A commenter supports the
expectation that states support
individuals in the planning process as
well as monitoring the personcenteredness of the process itself. The
commenter requests further refinement
of the rule to ensure that program
participants and community
stakeholders are actively engaged in the
states’ design of the program as well as
its ongoing quality management
structure so that person-centered
processes can be designed and
monitored with substantial involvement
of stakeholders. The commenter is also
pleased to see that as part of the service
planning process, program participants
(including those not self-directing) will
be offered choices pertaining to the
services and supports they receive. The
commenter requests that specific
examples or guidelines be offered to
states to demonstrate what this choice
may look like within traditional
services.
Response: We appreciate the support.
States are provided the latitude to
determine how they will operationalize
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the regulation. We do not wish to be as
prescriptive as suggested.
Comment: A few commenters
recommended that CMS require any
modifications to the conditions placed
upon provider-controlled or owned
residential settings be supported by a
specific assessed need documented in
the person’s person-centered plan. One
commenter stated that they did not
support unnecessarily restrictive
methods for providing person-centered
services and supports even though they
may be well-meaning.
Response: We agree with the
commenters’ statements and have
strengthened the language of this
section in the final rule by requiring at
§ 441.725(b)(13) that any modification of
the additional conditions must be
justified in the person-centered service
plan. We also added specific
requirements about what must be
documented in the person-centered
service plan in these instances.
Comment: One commenter suggested
that CMS make the person-centered
process the critical identification for
what is determined to be communitybased not where the site is located or
what it looks like. Another commenter
states that the person-centered planning
meeting should be where the needs and
preferences are matched with
compatible and appropriate services/
living arrangements and where
modifications to existing services and
acceptable compromises are
determined. They state that maintaining
a full continuum of services and settings
is a better plan than limiting options or
making them harder to access because
some people might find them
objectionable. One commenter states
that specific restrictions on living
arrangements should not supersede
supports and services identified through
the person-centered planning process.
Response: We believe that our
regulations need to address the issue of
what constitutes home and communitybased settings. While the personcentered service plan can and does
assist individuals with integration into
the community, it is not the vehicle to
determine whether a setting meets the
requirements for being home and
community-based.
Comment: One commenter requested
deletion of the requirement that services
be based on the needs of the individual
as indicated in their person-centered
service plan, stating that these plans are
often limited by the experience of the
individuals developing them and the
most effective treatments/supports may
not always be included. The commenter
noted that service needs and ideas for
how best to offer them evolve,
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particularly as a person progresses and
service plans often become stale before
they are reviewed/updated.
Response: We do not agree with
removing this requirement, and note
that it is based on statute at section
1915(i)(1)(G) of the Act. States are
responsible for determining that
requirements related to the
qualifications of the entities who will
conduct the assessments and the
person-centered planning process have
been met. It is expected that the
providers would have adequate training
to perform the function consistent with
the requirements set forth in the
regulation. States must ensure the
person-centered service plan process is
timely and includes a method for the
individual to request updates to the
plan. Additionally, an assessment of
need must be conducted when the
individual’s support needs or
circumstances change significantly and
revisions to the person centered services
plan are necessary.
Comment: Many commenters
recommend deletion of the language
that says the requirements are ‘‘based on
the needs of the individual as indicated
in their person-centered service plan.’’
The commenters believe that without
deletion or modification of the proposed
language, it would be too easy for a
provider to insert certain language in a
service plan.
Response: The person centered
planning process includes provisions to
protect a person-centered service plan
from being changed without the
individual’s consent. We believe the
inclusion of this language is a necessary
beneficiary protection; therefore we did
not revise the regulation to remove this
requirement.
b. Person-Centered Service Plan
§ 441.725(b)
Comment: One commenter states that
if CMS defines what a service plan
should be, it may be in direct conflict
with how states define their services
and the commenter does not believe that
this is the intent of CMS.
Response: We do not define specific
services. However, we do define what
should be included in the personcentered service plan, and by adopting
the terminology and process of a personcentered service plan, the services and
supports should reflect the individuals
preferences based on their needs.
Comment: One commenter
recommended, for high-need children
and older adult beneficiaries, the option
of further assessment and recommends
that there be allowable reimbursement
for these activities necessary for
developing the service plan, including
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communication with collateral
treatment partners (that is, pediatrician,
teacher, school representative, parent)
as these partners and activities are
critical for development of a service
plan for vulnerable beneficiaries and are
absolutely essential for proper care for
children and for seniors.
Response: States may be able to claim
reimbursement for assessment activity,
as well as person-centered service plan
development, as a Medicaid
administrative activity that is in
accordance with an approved cost
allocation plan.
Comment: One commenter
recommended enhancing regulation
language to ensure that states have the
flexibility to include services and
supports that are appropriate and
essential for child and youth
development, but may not be Medicaid
reimbursable, including education,
housing, and transportation, as to
encompass a comprehensive service
provision supported by HCBS.
Response: We believe the language in
§ 441.725(b)(5) of the final rule supports
this concept: ‘‘the plan must . . . reflect
the services and supports (paid and
unpaid) that will assist the individual to
achieve identified goals, and the
providers of those services and
supports, including natural supports.’’
Comment: Commenters supported
§ 441.665(b) and suggested that equal
emphasis be placed on what is
important for the individual and what is
important to the individual. One
commenter recommended the following,
‘‘The person-centered service plan must
reflect the services and supports that are
important for the individual to meet the
needs identified through an assessment
of functional need, and what is
important to the individual with regard
to preferences for the delivery of such
services and supports, including, but
not limited to, living arrangement,
neighborhood, leisure activities, and
relationships.’’
Response: We appreciate the
commenters’ support. As the language
of the proposed rule supports this
concept, we do not believe that the
suggested revisions for the final rule at
§ 441.725(b) are necessary.
Comment: Many commenters stated
their support of person-centered
planning and expressed that when the
individual welcomes the involvement of
family or other informal caregivers,
family members should be engaged as
part of the care planning and care-giving
teams. They stated that services to be
provided by family caregivers should
only be included in the person-and
family-centered plan if they have agreed
to provide these services and feel
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prepared to carry out the actual tasks.
One commenter agreed with preamble
language that the service plan should
neither duplicate, nor compel, natural
supports, expressing that unpaid
supports should be provided
voluntarily. This commenter suggested
that CMS include this specific language
in the regulation text.
Response: We appreciate the support
of the commenters. The language in
§ 441.725(b)(5) of this final rule states:
‘‘Natural supports are unpaid supports
that are provided voluntarily to the
individual in lieu of State plan HCBS.’’
Comment: One commenter supported
requirements for the development of a
person-centered plan but recommends
that § 441.665(b)(9) should clarify that
even though the service plan is
‘‘finalized and agreed to in writing by
the individual’’ the individual retains
the right to appeal a denial, reduction,
suspension, or termination of a service
described in part 431, subpart E.
Response: As the fair hearing
requirements at part 431, subpart E,
apply to all Medicaid services, it is not
necessary to revise the text of the
regulation at § 441.725.
Comment: Some commenters
recommended that each person-centered
service plan include the dollar figures of
the budget allocations provided to each
beneficiary, the starting date of services/
supports, the scope and duration of
service, and all other services that are
not Medicaid reimbursable.
Response: We agree that the person
centered service plan should be
comprehensive and the language in the
final rule supports this concept.
Comment: Two commenters were
against requiring the signatures of all
individuals and providers responsible
for implementation of the service plan,
stating that this is impractical and will
make the process untenable. They also
expressed that giving all providers the
entire service plan would share personal
health information of the member with
providers who do not necessarily need
to see that information. One commenter
was concerned about liability and who
is responsible if an individual has risky
behavior.
Response: The regulation language at
§ 441.725(b) gives the flexibility for the
individual to determine to whom the
plan will be provided, in whole or in
part, commensurate with the level of
need of the individual and the scope of
the services and supports available.
Sharing of this information must be
consistent with federal and state laws
regarding privacy and confidentiality.
Comment: Several commenters
recommended the following revisions
for § 441.665(c): ‘‘The person-centered
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service plan must be reviewed, and
revised upon reassessment of functional
need as required in § 441.662 of this
subpart, at least every 12 months, when
the individual’s circumstances or needs
change significantly, and at the request
of the individual, an authorized
representative, or healthcare or support
providers.’’ One of these commenters
stated that while having a service plan
required every 12 months may be
minimally okay for some populations, it
is insufficient (too lengthy) for those
with chronic mental health and
substance use disorders. Another
commenter stated that, at a minimum,
requiring service plan review every 6
months is adequate. Another commenter
stated that the reassessment being done
‘‘at the request of the individual’’ could
lead to inflated service hours and costs,
both of which will add unnecessary
costs to the provision of HCBS. This
commenter believed the language at
§ 441.662(b) is better language. Another
commenter was against requiring
assessments before the meeting.
Response: We proposed 12 months as
the minimum time period for an
individual’s person-centered service
plan to be reviewed and revised. We
agree and support reviews and revisions
of an individual’s person-centered
service plan more frequently as needed.
The person-centered service plan
should be reviewed and revised when
the individual’s circumstances or needs
change significantly and at the request
of the individual, authorized
representative or healthcare provider.
Comment: One commenter did not
support standardized functional
assessment. In addition, the commenter
stated that when service providers use
a functional assessment, it has been
typically to establish funding levels,
which should only be determined by a
person-centered planning process and
allowing such an instrument to overrule
the person-centered plan completely
negates the person-centered planning
process.
Response: An individual’s personcentered plan must be based on that
individual’s assessment of functional
need. We have not specified the
instruments or techniques that should
be used to secure the information
necessary to determine an individual’s
functional need, person-centered service
plan, or service budget. States do have
the ability to establish limits on amount,
duration, and scope of services.
Comment: With respect to
§ 441.665(b)(6), one commenter stated
that individual back-up plans have been
a critical component of participant
direction. A commenter suggested when
refining the proposed language, it will
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be important to reflect on the impact the
traditional paradigm has on the role
providers and participants play in
defining, identifying, and addressing
risk.
Response: We have strengthened the
language in the final rule to ensure that
reducing risk for individuals receiving
Medicaid HCBS does not involve
abridgement of their independence,
freedom, and choice. Restricting
independence or access to resources is
appropriate only to reduce specific
risks, and only when considered
carefully and reflected in the personcentered service plan.
9. Provider Qualifications (§ 441.730)
(Proposed § 441.668)
In the proposed rule, we proposed to
require states to provide assurance that
necessary safeguards have been taken to
protect the health and welfare of the
enrollees in State plan HCBS by
provision of adequate standards for all
types of providers of HCBS. States must
define qualifications for providers of
HCBS, and for those persons who
conduct the independent evaluation of
eligibility for State plan HCBS and
independent assessment of need, and
who are involved with developing the
person-centered service plan. We noted
that we will refer to the individuals and
entities involved with determining
access to care as ‘‘agents’’ to distinguish
this role from providers of services. We
also noted that the proposal in no way
preempts broad Medicaid requirements,
such as an individual’s right to obtain
services from any willing and qualified
provider of a service.
We believe that these qualifications
are important safeguards for individuals
enrolled in the State plan HCBS benefit
and proposed that they be required
whether activities of the agents are
provided as an administrative activity or
whether some of the activities are
provided as a Medicaid service. At a
minimum, these qualifications include
conflict of interest standards, and for
providers of assessment and personcentered service plan development,
these qualifications must include
training in assessment of individuals
whose physical or mental condition
may trigger a need for HCBS and
supports, and an ongoing knowledge of
current best practices to improve health
and quality of life outcomes.
The minimum conflict of interest
standards we proposed to require would
ensure that the agent is not a relative of
the individual or responsible for the
individual’s finances or health-related
decisions. The standards also require
that the agent must not hold a financial
interest in any of the entities that
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provide care. Our experience with
HCBS in waivers indicates that
assessment and person-centered service
plan development should not be
performed by providers of the services
prescribed. However, we recognize that
in some circumstances there are
acceptable reasons for a single provider
of service that performs all of those
functions. In this case, the Secretary
would require the State Plan to include
provisions assuring separation of
functions within the provider entity.
Comment: One commenter questioned
the reason for defining persons
responsible for the independent
evaluation, independent assessment and
the service plan as ‘‘agents’’ to
distinguish them from ‘‘providers’’ of
HCBS. Another commenter indicated
that it is unclear whether one agent
performs an assessment, or different
agents with different expertise.
Response: In the preamble to the
proposed rule, we discussed that we
will refer to persons or entities
responsible for the independent
evaluation, independent assessment,
and the person-centered service plan as
‘‘agents’’ to distinguish them from
‘‘providers’’ of home and communitybased services. We also explain that this
does not preclude the inclusion of input
from other individuals with expertise in
the provision of long-term services and
supports, or the delivery of acute care
medical services, as long as an
independent agent retains the final
responsibility for the evaluation,
assessment, and person-centered service
plan functions.
Comment: A commenter requested
whether states would be permitted to
allow a transition period for agents
conducting the individualized
independent evaluation, assessment and
service plan development to attain any
new qualifications, if necessary.
Response: We believe that it is
important for individuals responsible
for evaluation, assessment, and/or
person-centered service plan
development to fully meet the
qualifications specified at § 441.730(c)
prior to performing these activities.
Comment: Several commenters
recommended adding a requirement to
this section of the regulation that service
providers not discriminate against
recipients on the basis of race, color,
national origin, religion, sex, sexual
orientation, gender identity, marital
status, source of payment, or mental or
physical disability. Similar protections
are contained in the regulations for the
Program for All-Inclusive Care for the
Elderly (PACE).
Response: There are already general
provisions in other regulations that
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pertain to the issues raised by the
commenters and that prohibit
discrimination in State Medicaid
programs on the basis of race, color,
national origin, disability, etc., (for
example, see § 430.2, § 435.901,
§ 435.905, and § 435.908). As these
regulations apply in determining
eligibility and administering the
Medicaid program generally, it is not
necessary to add a regulation on this
subject specific to section 1915(i) of the
Act.
Comment: Several commenters
requested further clarification
pertaining to provider qualifications for
the participant direction option and
requested that provider qualifications
for participant-directed workers not
limit participants’ access to these
providers but be defined by the program
participant receiving services once s/he
is trained on the program rules and
expectations. One commenter
recommended that CMS make provider
qualifications ‘‘default rules’’ that could
be waived through an informed and
affirmative choice, with a signed
statement, by consumers who are
directing their own care. Another
commenter requested that CMS add to
the regulation ‘‘Such standards shall not
be construed to limit the ability of selfdirecting individuals who have
employer authority to hire, train,
manage, or discharge providers
pursuant to § 441.674.’’
Response: As stated in the proposed
rule, and retained in the final rule,
individuals who choose to self-direct
will be subject to the same requirements
as other enrollees in the State plan
HCBS benefit, including § 441.730 for
provider qualifications. Section 441.730
requires states to define in writing
standards for providers (both agencies
and individuals) of HCBS, and for
agents conducting individualized
independent evaluation, independent
assessment, and person-centered service
plan development. As with section
1915(c) of the Act waivers, states have
to define minimum service provider
qualifications that apply across the
service delivery models.
Comment: Many commenters
expressed support of the conflict of
interest provisions of the proposed rule.
One such commenter stated support of
standards that will result in service
plans that have realistic expectations
and payment for providers while
adequately addressing the client’s
individual needs, noting that too often
costs are driving decisions about the
appropriate services for the individual.
One mentioned that it is difficult for a
system to be completely free of conflict
of interest, since any assessor that works
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for the state has an interest in
controlling costs, but stated their belief
that acknowledging the conflicts helps
to mitigate the effects. Another
indicated that guidance should reflect
administrative safeguards that consider
each state individually and consider the
unique characteristics and needs of each
state, and include conflict free
protections that address the
development of the plan and choice of
providers with an emphasis on
individual preferences. Another
requested that this be closely monitored.
Response: We appreciate the support
and agree with the commenters. We will
consider these additional comments as
we develop future guidance.
Comment: Several commenters
requested that § 441.668 exclude a
managed care organization from
conducting the independent evaluation
of individuals. Another stated a
managed care organization should not
be permitted to conduct the
independent assessment of individuals.
And another requested this section also
exclude ‘‘the state’’ from conducting the
independent assessment of individuals.
Response: We do not believe it is
necessary to list specific entities that
would not meet these requirements in
regulation. We believe the specific
requirements of § 441.730 capture the
purpose of these requirements to
mitigate and prevent conflict of interest.
Comment: One commenter indicated
that the requirements regarding an
independent evaluator would not work
in a capitation model, and that it adds
another level of bureaucracy and
impacts service systems already in place
by some states that delegate or contract
out this function to another agency.
Another commenter stated that the
requirements would limit states to the
development or use of models that
contradict decades of long term care
policy and efforts to coordinate an
otherwise fragmented system. They
expressed that models that consolidate
evaluation, assessment, care planning,
case management and the provision of
services into integrated, single entry
systems enable beneficiaries to more
seamlessly access services and receive
coordinated, integrated plans of care (for
example, long term home health care
programs, managed long term care,
PACE). Another commenter disagreed
with the independent agent
requirement, stating there may be cost
implications if an independent
contractor is used to develop the
person-centered service plan and that
this proposed requirement may work in
a fee-for-service benefit, but would not
work in a benefit that is capitated.
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Response: We disagree and have
experience with states where this does
and is working in these models. While
the evaluation to determine whether an
individual is eligible for the benefit
would need to be retained by an
independent entity that is not the
provider, providers can contribute
information to the entity responsible for
the final determination. Regarding the
independent assessment of need and
person-centered service plan, to
summarize § 441.730(b)(5), states can
allow providers of State plan HCBS, or
those who have an interest in or are
employed by a provider of State plan
HCBS, to be the entity responsible for
the assessment and person-centered
service plan functions, when the state
demonstrates that they are the only
willing and qualified agent to perform
these two functions in a geographic
area, and the state devises conflict of
interest protections including separation
of agent and provider functions within
provider entities, and a clear and
accessible alternative dispute resolution
process for individuals. In summary, the
requirements at § 441.730, which are
based on our experience as well as state
and other public feedback, specify how
states must comply with statutory
requirements. Therefore, we are
retaining the requirements from the
proposed rule at § 441.730 regarding
independent evaluation and conflict of
interest standards, in this final
regulation. We note that CMS stands
ready to assist any State Medicaid
agency in need of technical assistance
with these requirements.
Comment: Several commenters
requested that § 441.668(b)(5) be
expanded to make it clear that when
there is only one provider available, the
provider may serve as the agent
performing the assessment and the agent
developing the plan of care, as long as
the requirements in § 441.668(b)(5) are
met. Another commenter proposed
permitting providers in some cases to
serve as both agent and provider of
services, but with guarantees of
independence of function within the
provider entity.
Response: We believe that
§ 441.730(b)(5) already includes this
requirement: ‘‘Providers of State plan
HCBS for the individual, or those who
have an interest in or are employed by
a provider of State plan HCBS for the
individual, except when the state
demonstrates that the only willing and
qualified agent to perform independent
assessments and develop plans of care
in a geographic area also provides
HCBS, and the state devises conflict of
interest protections including separation
of agent and provider functions within
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provider entities, which are described in
the State plan for medical assistance
and approved by the Secretary, and
individuals are provided with a clear
and accessible alternative dispute
resolution process.’’
Comment: A couple of commenters
recommended deletion of § 441.668
(b)(5), indicating that this provision to
waive the conflict of interest standards
minimizes safeguards to protect
individual health, welfare, choice, and
control. They indicate that states should
be required to develop in all geographic
areas sufficient systems of independent
evaluators, independent assessors, and
providers to develop service plans. They
noted that since CMS’s experience with
HCBS waivers has shown that
assessment and service plan
development should not be performed
by service providers, this should be
carried over and applied to State plan
HCBS as well.
Response: Section 441.730 (b)(5)
requires that service providers not be
permitted to be the agent responsible for
these functions, but includes an
exception to allow a state to permit a
service provider to serve as the agent
performing independent assessments
and development of the person-centered
service plan when that service provider
is the only entity available in a certain
area. This is only permitted to address
this potential problem of not having any
entity available that is not a provider to
perform these essential functions of
independent assessment and personcentered service plan development
(under any circumstances,
determination of eligibility for the State
plan HCBS benefit cannot be performed
by a HCBS provider or an entity with an
interest in providers of HCBS). Without
this exception, states would be unable
to make State plan HCBS available to
participants in these areas. If a state
employs this exception it must
guarantee the independence of this
function(s) within the provider entity.
In certain circumstances, we may
require that states develop ‘‘firewall’’
policies, for example, separating staff
that perform assessments and develop
person-centered service plans from
those that provide any of the services in
the plan; and meaningful and accessible
procedures for individuals and
representatives to appeal to the state.
We also will not permit states to
circumvent these requirements by
adopting state or local policies that
suppress enrollment of any qualified
and willing provider.
Comment: A couple of commenters
expressed concerns that an independent
agent may not have sufficient
knowledge about the needs of an
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individual, and that providers who have
longer histories with the individuals are
better qualified to conduct evaluations
and assessments and develop care plans
and would improve individuals’ access
to the benefit. One indicated that
independent agents may not have the
capacity to follow-up with individuals
who are hard to reach, such as
individuals experiencing homelessness.
Another indicated that we should allow
service providers within supportive
housing to complete assessments or it
might unintentionally limit the
availability of supportive housing for
HCBS beneficiaries. They suggest that
CMS engage independent agents in
oversight activities to ensure
individuals are made aware of all
available options and that providers do
not inappropriately advantage
themselves.
Response: We recognize the
importance of ensuring that the agents
responsible for the evaluations,
assessment, and person-centered service
plans are trained in assessment of
individual needs for HCBS and
knowledgeable about best practices.
That is why we included requirements
at § 441.730(a) for states to define in
writing standards for agents, and at
§ 441.730(c), that these qualifications
must include training in assessment of
individuals whose physical or mental
conditions trigger a potential need for
home and community-based services
and supports, and current knowledge of
best practices to improve health and
quality of life outcomes. We further note
that we understand that the process of
developing appropriate plans of care
often requires the inclusion of
individuals with expertise in the
provision of long-term services and
supports or the delivery of acute care
medical services.
Comment: Another commenter stated
that CMS’s proposal to remove
providers from participating in
assessments, evaluations, and plans of
care does not appear required by the
DRA and requested that CMS remove
this prohibition on providers’ ability to
carry out these critical functions and
deliver the needed services to their
beneficiaries.
Response: This rule does not prevent
providers from participating in these
functions, but requires that an
independent agent retains the final
responsibility for the evaluation,
assessment, and person-centered service
plan functions. We understand that the
process of developing appropriate plans
of care often requires the inclusion of
individuals with expertise in the
provision of long-term services and
supports or the delivery of acute care
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medical services. In order to meet the
intent of the statute for standards that
safeguard against conflict of interest
standards, we are retaining these
requirements as proposed.
Comment: Several commenters
recommended that minimum
safeguards/standards be prescribed in
the regulation, including standards
related to training, skills, and
competency, with state flexibility to
develop additional standards and CMS
reviewing the state standards for
approval. One recommended giving
service providers and agencies rate
incentives to partner with training
providers and community colleges to
ensure that the qualifications of the
workforce meet the needs of their
clients. Others recommended adding
that agents must have current
knowledge/training in evidence-based
practices for assessment and evidencebased best practices to improve health
and quality of life outcomes, personcentered planning, and informed
decision making. Another
recommended that CMS identify broad
competency areas and then identify the
specific skills associated with each of
these competency areas. Another noted
that individuals performing assessments
will need to be sufficiently trained to
assess cognitive impairment.
Response: Section 441.730(a) of the
proposed rule would require states to
define in writing standards for agents,
and at § 441.730(c), that these
qualifications must include training in
assessment of individuals whose
physical or mental conditions trigger a
potential need for home and
community-based services and
supports, and current knowledge of best
practices to improve health and quality
of life outcomes. We agree with the
commenters’ suggestions and have
added ‘‘cognitive’’ to § 441.730(c).
Comment: One commenter
encouraged the addition of language
that focuses on the qualifications,
training and outcomes ‘‘of the case
manager in the areas of case
management, the populations they are
serving, funding and resources available
in their community, the offering of free
choice of providers and service options
and training and expectations regarding
conflict-free case management.’’
Response: We note that we are not
restricting the individuals or entities
who can perform these administrative
activities to case managers. We also note
that conflict of interest requirements are
found at § 441.730(b). We agree that
knowledge of available resources,
service options, and providers is not an
element specifically captured in the
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proposed regulation language, so we
have added language to § 441.730(c).
Comment: A couple of commenters
requested that CMS revise the regulation
to provide that the required training of
agents must include person-centered
and family driven services planning, as
well as participant-directed practices.
Response: We believe that this idea is
already reflected for purposes in the
broader phrase ‘‘and current knowledge
of best practices to improve health and
quality of life outcomes.’’
Comment: One commenter pointed
out that evaluators should also obtain
proper training and should be reflected
in § 441.668(c).
Response: The independent
evaluators determine whether or not an
individual meets the eligibility
requirements for the benefit, but unless
they are also the same entity responsible
for the independent assessment and
plan of care development, we do not
believe it would be reasonable to require
that they meet these minimum training
requirements that are appropriate
minimum qualifications for agents
responsible for independent assessment
and person-centered service plan
development (assessment of individuals
whose physical or mental conditions
trigger a potential need for HCBS and
supports, and current knowledge of
available resources, service options,
providers, and best practices to improve
health and quality of life outcomes).
10. Definition of Individual’s
Representative (§ 441.735) (Proposed
§ 441.671)
In § 441.671, we proposed to define
the term ‘‘individual’s representative’’
to encompass any party who is
authorized to represent the individual
for the purpose of making personal or
health care decisions, either under state
law or under the policies of the State
Medicaid agency. We did not propose to
regulate the relationship between an
individual enrolled in the State plan
HCBS benefit and his or her authorized
representative, but noted that states
should have policies to assess for abuse
or excessive control and ensure that
representatives conform to applicable
state requirements. We noted that states
must not refuse to allow a freely-chosen
person to serve as a representative
unless the state has tangible evidence
that the representative is not acting in
the best interest of the individual, or
that the representative is incapable of
performing the required functions.
General Comments: All commenters
for this section agreed with this
provision, and some additionally
suggested some revision to the language
as described in the comments below.
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Comment: A couple of commenters
recommended changing ‘‘family
member’’ to ‘‘a parent support
provider.’’
Response: The language in this phrase
is statutory, from section 1915(i)(2) of
the Act. The commenter did not provide
any definition of this term or
explanation. For these reasons, we are
unable to accept this change as
requested, but note that this provision at
§ 441.735(b) is not an exhaustive list.
Comment: Another commenter
expressed that an individual’s
representative may not necessarily be
the individual’s guardian, but some
other representative freely chosen by the
individual and important to him or her.
Response: We agree and believe the
language in the regulation supports this
as an option to the individual.
Comment: We received many
comments about the term ‘‘best
interest.’’ Most of these commenters
requested that CMS substitute the term
‘‘substituted judgment’’ instead of ‘‘best
interest.’’ One cautioned that ‘‘best
interests’’ may be a highly subjective
assessment, and stated their belief that
substantial deference should be
established for the stated interests of the
individual and the decisions of their
chosen representative. Others
referenced guidelines established by the
National Guardianship Association
(NGA), which indicate that substituted
judgment is a principle of decisionmaking that promotes the selfdetermination of the beneficiary and
that substitutes, as the guiding force in
any surrogate decision made by the
guardian, the decision the beneficiary
themselves would make based on their
own preferences and wishes. This
process involves consultation with the
individual and those important to the
individual. If a substituted judgment is
not available, guardians can implement
a ‘‘best interest’’ principle, which
considers all options and alternatives
and bases the decision on what a
reasonable person would do in the given
situation.
Response: We agree with these
commenters and have revised this
section of the regulation, § 441.735(c),
so that it now reads as follows:
‘‘When the state authorizes representatives
in accordance with paragraph (b) of this
section, the state must have policies
describing the process for authorization; the
extent of decision-making authorized; and
safeguards to ensure that the representative
uses substituted judgment on behalf of the
individual. State policies must address
exceptions to using substituted judgment
when the individual’s wishes cannot be
ascertained or when the individual’s wishes
would result in substantial harm to the
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individual. States may not refuse to recognize
the authorized representative that the
individual chooses, unless in the process of
applying the requirements for authorization,
the state discovers and can document
evidence that the representative is not acting
in accordance with these policies or cannot
perform the required functions. States must
continue to meet the requirements regarding
the person centered planning process at
§ 441.725 of the rule.’’
Comment: We received one comment
about state laws regarding guardianship
and the jurisdiction of the courts, in
which they stated that guardians are
appointed by the court, not chosen by
the individual.
Response: We believe this concept is
captured with the use of the term
‘‘legal’’ prior to ‘‘guardian’’ in the
language of the final regulation at
§ 441.735(a) which pertains to a legal
guardian authorized under State law to
represent the individual. We note that
the provision at § 441.735(c) only
applies to individuals specified at
§ 441.735(b) who are authorized under
the policy of the State Medicaid agency
to represent the individual.
Comment: A couple of commenters
confirmed the importance of
participants’ access to a representative
option. One requested that CMS add
‘‘States should ensure that
representatives conform to good practice
concerning free choice of the individual,
and assess for abuse or excessive
control.’’ Another stated that supports
providers (for example, consultants,
support brokers) need to be
appropriately trained on the participant
direction paradigm to be prepared to
successfully identify when a
representative may be using ‘‘excessive
control’’ as well as to enforce ‘‘free
choice’’ of representatives.
Response: If by ‘‘free choice of the
individual’’ the commenter means the
individual’s free choice of providers,
this Medicaid requirement at section
1902(a)(23) of the Act is not waived or
disregarded under section 1915(i) of the
Act and is not a subject of this rule. We
believe that the proposed language
broadly covers the other elements of this
comment, and we will consider
addressing this issue further in future
guidance.
Comment: One commenter requested
that the word ‘‘should’’ be replaced with
‘‘must’’ or ‘‘implement policies to.’’
Response: The proposed and final
regulation language does not contain the
word ‘‘should.’’
Comment: One commenter expressed
the need for a representative to be
identified by the participant after s/he is
well informed of the program and his/
her responsibilities. They further
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commented that effective practices for
identifying and choosing representatives
should be shared with the participants
during program orientation and as
needed.
Response: We believe this would be
an example of a good state practice,
which we will consider for inclusion in
future guidance.
Comment: One commenter stated that
based on the general principles of
participant direction, states should not
require that individuals have
representatives without prior attempts
to train and support the participant.
Response: The purpose of this
provision is not to require an individual
to have a representative but it is to
require states to allow the option for an
individual to choose a representative for
the purpose of participating in decisions
related to the person’s care or well-being
when the individual requires assistance
in making such decisions, and to have
policies for the process for
authorization, the extent of decisionmaking authorized, and safeguards. We
note that where a legal guardian,
conservator, or other person has the sole
authority under state law to make
decisions related to the individual’s
care, the state must comply with the
decisions of the legal surrogate.
Comment: One commenter requested
that the following language from the
preamble of the proposed rule, or
something similar, be added to the
actual regulation text: ‘‘. . . process
should still be focused on the individual
requiring services, and that supports
should be provided to allow the
individual to meaningfully participate
and direct the process to the maximum
extent possible.’’
Response: We have added the
following to § 441.735(c) of this rule:
‘‘States must continue to meet the
requirements regarding the personcentered planning process at Section
441.725 of this rule.’’
11. Self-Directed Services (§ 441.740)
(Proposed § 441.674)
Section 1915(i)(1)(G)(iii)(I) and (II) of
the Act provides that states may offer
enrolled individuals the option to selfdirect some or all of the State Plan
HCBS that they require. Self-directed
State plan HCBS allow states another
avenue by which they may afford
individuals maximum choice and
control over the delivery of services,
while comporting with all other
applicable provisions of Medicaid law.
We have urged all states to afford waiver
participants the opportunity to direct
some or all of their waiver services,
without regard to their support needs.
With the release of an updated, revised
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section 1915(c) of the Act waiver
application in 2008, we refined the
criteria and guidance to states
surrounding self-direction (also referred
to as participant-direction), and
established a process by which states
are encouraged, to whatever degree
feasible, to include self-direction as a
component of their overall HCBS waiver
programs. While section 1915(i) of the
Act does not require that states follow
the guidelines for section 1915(c) of the
Act waivers in implementing selfdirection in the State plan HCBS
benefit, we anticipate that states will
make use of their experience with
section 1915(c) of the Act waivers to
offer a similar pattern of self-directed
opportunities with meaningful supports
and effective protections.
Comment: Several commenters
recommended that CMS include
training as one aspect of employerauthority activities that self-directing
beneficiaries may be allowed to
exercise. A couple of commenters urged
CMS to require states to offer training
for individuals on selecting, hiring,
supervising and firing service providers,
in addition to service provider training.
Response: We agree with this
recommendation and have added the
following to the § 441.740(e)(3):
‘‘Voluntary training on how to select,
manage, and dismiss providers of State plan
HCBS.’’
We note that many states currently
have existing training programs
available that could potentially be
leveraged or modified to meet such a
requirement. Training programs should
be able to meet the needs of individuals
at varying levels of need with regard to
selecting, managing, and dismissing
providers. Consistent with the
philosophy of self-direction, this
training must be voluntary, and may not
be a mandatory requirement for the
individual to receive services under this
option.
Comment: One commenter requested
training for agents conducting
evaluations, assessments, and service
planning.
Response: Training for agents
conducting evaluations, assessments,
and person-centered service planning is
a requirement that was stipulated under
the proposed rule at § 441.668, provider
qualifications, and remains unchanged
in this final rule at § 441.730.
Comment: One commenter
recommended that CMS consider
requiring states to provide joint
trainings for both consumers and
providers, as they have resulted in
improved services, better
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communication and a stronger
relationship.
Response: We believe that this would
be more suited as one option that a state
could put into practice to meet training
requirements.
Comment: One commenter indicated
that states should be provided guidance
on elements that are important for
participant direction assessment (for
example, strengths, abilities, individual
goals, need for a representative, capacity
to self-direct with an eye for developing
a support system to ensure success in
self-directing, and risks).
Response: These elements are already
required under § 441.725(b), pertaining
to the person-centered service plan.
Comment: One commenter applauded
CMS for their inclusion of participant
direction support functions, stating that
they are well documented by research
and that successful participant direction
opportunities are dependent on the
appropriate execution of each of these
support functions. The commenter
requests that CMS describe within the
rule the elements of each of these
functions (as seen with the financial
management services function).
Response: We appreciate the support
of the commenter. Experience with
section 1915(c) of the Act and other
Medicaid HCBS authorities have been
instrumental in demonstrating the
importance of the availability of
information, assistance, and support to
participants who self-direct their HCBS.
Since the purpose of this regulation is
to stipulate the minimum requirements
that states must meet for the section
1915(i) of the Act authority, we believe
the commenter’s request will be best
suited as future sub-regulatory
guidance/policy.
Comment: One commenter expressed
appreciation of well-structured
definitions for both employer authority
and budget authority, and
recommended an edit to the ‘‘employer
authority’’ definition to ensure its
consistency with existing best practices:
replace the ‘‘or’’ in ‘‘the ability to select,
manage, or dismiss providers of State
plan HCBS’’ with an ‘‘and’’ since the
ability to do all three functions is
critical to the model.
Response: Since each of these
functions is optional, and we want to
ensure that the protections at
§ 441.740(c) are provided with selection
of any of these optional functions, we
are unable to adopt the commenter’s
recommended revision.
Comment: Several commenters
requested revising the provisions related
to budget authority in § 441.674(d)(5) to
make it clear that self-directing
individuals with budget authority may
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be allowed to pay providers directly.
Another commenter requested revision
to § 441.674(e)(2)(iii) of the proposed
rule to clarify that employer-related
financial transactions, such as paying
worker wages and taxes, may also be
made for individuals with employer
authority.
Response: Section 1915(i) of the Act
does not give states the authority to
allow participants to perform
transactions or convey cash to the
individual or representative. It does
allow for budget authority to grant
individuals control of expenditures. In
addition, with sufficient state Medicaid
agency process and oversight, states
may choose to employ alternate
methods to maximize participant
autonomy within the parameters of the
section 1915(i) of the Act authority.
Comment: One commenter requested
that we add a requirement to
§ 441.674(b)(4) that ‘‘there are state
procedures to ensure the continuity of
services during the transition from selfdirection to other models of service.’’
Response: We agree with this
comment and have added additional
language to the rule at § 441.740(b)(4).
Comment: One commenter requested
that § 441.674(d) regarding budget
authority require that the service plan
specify the authority to be assumed by
the individual, any limits to the
authority, and specify parties
responsible for functions outside of the
authority to be assumed.
Response: The commenter’s request is
already addressed in the requirement as
included in the proposed rule under
§ 441.674(b)(2), which we are finalizing
at § 441.740(b)(2).
Comment: Section § 441.674(e)(2)
regarding financial management
supports should clarify that federal
financial participation (FFP) is available
for this service.
Response: States have the option of
providing this type of activity as a
Medicaid administrative activity or as a
Medicaid service, as long as the activity
meets Medicaid requirements. It is not
necessary for this to be specified in the
text of the regulation. We will explain
these options in future guidance.
Comment: One commenter requested
clarification to indicate that a state may
provide for employer functions itself, or
through a fiscal/employer agent or other
state-contracted entity under the state’s
direction and control. They stated that
it should also be clear that states have
the option to offer these supports to
individuals directly or through a public
entity.
Response: States have the option of
providing this type of activity as a
Medicaid administrative activity or as a
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Medicaid service, as long as the activity
meets Medicaid requirements. We do
not believe that this degree of specificity
would be appropriate as a requirement
under regulation text, but will be
considered in the development of any
future guidance.
Comment: Two commenters requested
CMS to revise the requirement that
states offer individual supports so that
it includes peer-to peer support and
family-driven care.
Response: While we agree that these
are important supports that states
should consider making available to
individuals, we do not believe that this
degree of specificity would be
appropriate as a requirement under
regulation text. We will however,
consider this in the future development
of additional guidance.
Comment: Two commenters indicated
that it is unclear what is meant by, and
stated concerns about, the statement
that evaluation results will lead to the
determination of ‘‘ability to self-direct
[both with and without specific
supports].’’ One of these commenters
expressed support of any evaluation
criteria that encourages an individual to
personally assess his/her interests and
abilities to self-direct while not leading
to professional decisions made in
isolation based solely on the
individual’s disability, personal
characteristics, or experiences. The
other commenter stated the belief that,
with appropriate supports, essentially
all individuals are able to self-direct,
using Michael Weymeyer’s concept of
the individual as causal agent in their
life, and that it is hard to understand the
purpose of determining the ability of
someone to self-direct without supports.
Both agree that a person-centered
system that includes participant
direction should be able to support
people to make informed decisions
pertaining to their care while providing
the individualized support s/he needs to
successfully self-direct.
Response: The purpose of inclusion of
‘‘without supports’’ in this paragraph is
to be inclusive of the individual’s
option to not avail him/herself of the
opportunity to use the self-directed
supports that states are required to offer
under this option, while also preserving
the responsibility of states to ensure that
the individual receives the needed
services in accordance with his/her
person-centered service plan.
Comment: One commenter stated that
self-directed service plans should be
aligned with the most integrated setting
definition under the ADA and Olmstead
and recommended additional language
be added under § 441.674(b).
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Response: This recommendation is
already captured under § 441.725(b)(1),
which pertains to all person-centered
service plans.
Comment: One commenter expressed
an opinion about the requirement in the
proposed rule that the service plan
indicate not only the services that will
be self-directed, but also the ‘‘methods
by which the individual will plan,
direct, or control these services.’’ The
commenter expressed that this language
is dangerously vague, and as a result,
may lead to specificity within the
service plan that is not sensitive to the
flexible and dynamic processes required
for successful participant direction.
Response: This language is referring
to participant preferences with regards
to how they choose to self-direct their
services, including employer and/or
budget authority if elected by the state.
More detail and requirements regarding
these two authorities is specified under
§ 441.740(c) and (d).
Comment: One commenter stated the
importance of individualized
contingency plans as being well stated,
and appropriate in the proposed
regulation. Another stated that risk
management techniques should not
interfere with the right to self-direct and
other choices and rights unless there is
a documented, clear, concrete danger
present. Another commenter indicated
that it is important that participant
direction philosophy inform any risk
management techniques, which are
required in the proposed rule to be
listed in the service plan, with the
participant leading the process and
creating back-up plans unique to his/her
needs. The commenter also supports a
transparent individual budget
development and monitoring process,
but at the same time recognizes the
importance of providing participants
with accessible information that is not
too overwhelming and easy to digest.
They recommend that any tools for this
purpose be simple and straight forward,
making them accessible to all program
participants.
Response: We appreciate and agree
with these comments and will consider
them for inclusion in future guidance.
Comment: One commenter indicated
that states are using the self-directed
option to save money, and that selfdirected services are often reimbursed at
a lower rate than agency-directed
services for no clear reason, causing
wages for workers in self-directed
programs to be substantially lower than
wages for agency-controlled workers.
Response: Self-directed provision of
services provides the states with the
option to give individuals the flexibility
to negotiate preferred rates for services,
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frequently with individuals that have a
pre-existing relationship with the
consumer, for example, a friend or
neighbor. This may result in costs for
services that are lower than comparable
services provided by an agency. The
rates selected by individuals who are
self-directing may or may not include
the administrative overhead that occurs
when an agency employs individual
workers to provide services.
Comment: Several commenters stated
that self-direction as a delivery method
and supports to participants to selfdirect, should be required and not state
options. Another stated that agencybased services should be available only
for those who cannot manage selfdirection (with supports) and have no
authorized representative.
Response: Section 1915(i)(G)(iii) of
the Act allows states the option to offer
individual election for self-directed
services. The statute does not include
the authority for the Secretary to require
that the services that states offer under
section 1915(i) of the Act must be selfdirected. For states that choose to offer
individual election to self-direct their
HCBS, states must make information
and assistance available to those
individuals to support their direction of
services.
Comment: One commenter applauded
the ability for states to allow
participants to direct any or all of the
State plan HCBS benefit, and stated the
potential for confusion, unnecessary
complexity, and limited control when
states decide to limit the ability to selfdirect to one specific service. They
strongly recommended that states
receive technical assistance and
guidance on the benefits of participant
direction and how to implement
participant direction opportunities to
the furthest extent possible, including
providing access to an individual
budget model.
Response: We appreciate these
comments. We are available to provide
guidance and assistance to states and
encourage states to contact us with any
such requests.
Comment: One commenter stated that
the following statement is extremely
vague and requires clarification:
‘‘According to the proposed rule,
individuals who choose to self-direct
will be subject to the ‘same
requirements’ as other enrollees in the
State plan HCBS benefit.’’ They stated
that it is important that any
requirements created be sensitive to the
participant direction philosophy and
informed by evidence-based participant
direction practices.
Response: This statement in the
preamble was only stating that the other
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requirements of section 1915(i) of the
Act, such as eligibility, adjustment
authority, independent evaluation and
assessment, person-centered service
plan, etc., are still requirements that
must be applied for individuals who
choose to self-direct their services.
Additional requirements specific to the
self-direction option were included in
the proposed rule, and were based on
our experience with section 1915(c) of
the Act waivers and other Medicaid
authorities in order to include a similar
pattern of self-directed opportunities
with meaningful supports and effective
protections.
Comment: One commenter stated the
assumption that states have the option
to provide program participants with
employer authority or budget authority
(as opposed to requiring both), but
indicated that they find the language in
the proposed rule pertaining to this
point vague.
Response: Section 441.740(b)(2)
already specifies ‘‘and/or’’ to indicate
this option.
Comment: One commenter, with a
reminder that the proposed rule allows
states to enter into a ‘‘co-employer’’
relationship with participants, stated
that it is important to recognize that
there is no one standard definition for
‘‘Agency with Choice,’’ leading to
inconsistent application and monitoring
of this model. The commenter strongly
encouraged CMS, in collaboration with
the Department of Labor and informed
by existing state labor laws and
stakeholders, to set standards for the
‘‘Agency with Choice’’ model that are
reflective of the participant direction
paradigm and the liabilities specific to
this model.
Response: We appreciate this
comment and will take it under
consideration in the development of
future guidance.
Comment: One commenter
recommended that § 441.674(b) include
a reference to § 441.674(e) requiring selfdirection supports to be included in the
service plan, since paragraph (e) is
cross- referenced in other paragraphs, at
§ 441.674(c)(2) and § 441.674(d)(4)).
Response: After consideration of this
comment, we believe the inclusion of
this requirement under both
§ 441.740(c)(2) and (d)(4) is repetitive
and would be better placed under
§ 441.740(b) as a new paragraph (5).
Therefore, we made this addition to
§ 441.740.
Comment: One commenter
recommended that § 441.674(e) should
explicitly include the requirement
suggested in the preamble (77 Fed. Reg.
26373, first column) for an
‘‘independent advocate.’’
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Response: We are not adding this as
a requirement to this final rule.
However, we believe the availability of
an independent advocate to assist the
individual with the access to and
oversight of their waiver services,
including self-direction, is an important
component of a strong self-directed
system.
Comment: One commenter
recommended that CMS explain, in
§ 441.674(a), that individuals should be
encouraged to retain authority over all
functions (budgeting, staffing, etc.), but
that individuals could choose only to
retain authority over specific functions.
They also recommended that CMS add
the term ‘‘, but not limited to,’’ after the
term ‘‘including.’’
Response: The purpose of § 441.740(a)
is to specify the state option to offer the
election for self-directing HCBS. The
language that the commenter has
suggested would not be appropriate for
this regulation since it would not
stipulate a state requirement. Regarding
the second comment, we do not agree
with leaving this open-ended, and since
it is unclear what else would be selfdirected in addition to amount,
duration, scope, provider, and location
of the HCBS, we are unable to make the
suggested revision.
Comment: One commenter urges CMS
to promote matching service registries
as robust models of information and
assistance as a way to assist participants
with identifying and accessing
independent providers.
Response: We appreciate this
comment and will consider it for
inclusion in future guidance.
12. State Plan HCBS Administration:
State Responsibilities and Quality
Improvement (§ 441.745) (Proposed
§ 441.677)
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a. State Responsibilities
States are required to provide CMS
annually with the projected number of
individuals to be enrolled in the benefit,
and the actual number of unduplicated
individuals enrolled in the State plan
HCBS benefit in the previous year.
Section 1915(i) of the Act authorizes a
state to elect not to apply comparability
requirements, thus permitting states to
target the entire section 1915(i) of the
Act benefit, specific services within the
benefit, or both. Under
§ 441.745(a)(1)(ii), we specify that the
state may not limit enrollee access to
services in the benefit for any reason
other than assessed need or targeting
criteria. This includes the requirement
that services be provided to all
individuals who are assessed to meet
the targeting criteria and needs-based
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criteria, regardless of income. This is an
important distinction between the limits
states place on the services to be offered
when they design the benefit, as
opposed to limiting access to the
services that are in the benefit for
particular enrolled individuals. As
discussed in the proposed rule, states
have a number of permitted methods to
control utilization. We proposed that
once an individual is found eligible and
enrolled in the benefit, access to
covered services can be limited on the
basis of the needs-based criteria as
evaluated by the independent
assessment and incorporated into the
person-centered service plan. By not
limiting access, we mean that an
enrollee must receive any or all of the
HCBS offered by the benefit, in scope
and frequency up to any limits on those
services defined in the state plan, to the
degree the enrollee is determined to
need them. Enrollees should receive no
more, and no fewer, HCBS than they are
determined to require.
b. Administration
We proposed in § 441.677(a)(2)(i) an
option for presumptive payment. In
accordance with section 1915(i) of the
Act, the state may provide for a period
of presumptive payment, not to exceed
60 days, for evaluation of eligibility for
the State plan HCBS benefit and
assessment of need for HCBS. This
period of presumptive payment would
be available for individuals who have
been determined to be Medicaid
eligible, and whom the state has reason
to believe may be eligible for the State
plan HCBS benefit. We proposed that
FFP would be available for evaluation
and assessment as administration of the
approved state plan prior to an
individual’s determination of eligibility
for and receipt of other section 1915(i)
of the Act services. If the individual is
found not eligible for the State plan
HCBS benefit, the state may claim the
evaluation and assessment as
administration, even though the
individual would not be considered to
have participated in the benefit for
purposes of determining the annual
number of individuals served by the
benefit. FFP would not be available
during this presumptive period for
receipt of State plan HCBS.
In § 441.677(a)(2)(ii), we proposed
that a state may elect to phase-in the
provision of services or the enrollment
of individuals if the state also elects not
to apply comparability requirements
and to target the benefit to specific
populations. However, there is no
authority to limit the numerical
enrollment in the benefit or to create
waiting lists. Therefore, we proposed
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that any phase-in of services may not be
based on a numerical cap on enrollees.
Instead, a state may choose to phase-in
the benefit or the provision of specific
services based on the assessed needs of
individuals, the availability of
infrastructure to provide services, or
both. Infrastructure is defined as the
availability of qualified providers or of
physical structures and information
technology necessary to provide any
service or set of services. A state that
elects to phase-in the benefit must
submit a plan, subject to CMS approval,
that details the criteria used for phasing
in the benefit. In the event that a state
elects to phase-in the benefit based on
needs, all individuals who meet the
criteria described in the phase-in plan
must receive covered services. If a state
elects to phase-in services based upon
infrastructure, the plan must describe
the capacity limits, strategies to increase
capacity, and must assure that covered
services will be provided to all
individuals who are able to acquire a
willing and qualified provider. Any
phase-in plan must provide assurance
that the benefit, and all included
services, will be available statewide to
all eligible individuals within the first
5-year approval period.
In § 441.677(a)(2)(iii), we proposed
that a state plan amendment submitted
to establish the State plan HCBS benefit
must include a reimbursement
methodology for each covered service.
In some states, reimbursement methods
for self-directed services may differ from
the same service provided without selfdirection. In such cases, the
reimbursement methodology for the
self-directed services must also be
described.
In § 441.677(a)(2)(iv), we proposed
that the state Medicaid agency describe
the line of authority for operating the
State plan HCBS benefit. The State plan
HCBS benefit requires several functions
to be performed in addition to the
service(s) provided, such as eligibility
evaluation, assessment, and developing
a person-centered service plan. To the
extent that the state Medicaid agency
delegates these functions to other
entities, we proposed that the agency
describe the methods by which it will
retain oversight and responsibility for
those activities, and for the operation
and quality improvement of the benefit
as a whole. Delegation of
responsibilities by the state Medicaid
agency must comply with the single
state agency requirements of section
1902(a)(5) of the Act and § 431.10.
In § 441.677(a)(2)(v), we included a
provision regarding the effective dates
of amendments with substantive
changes. Substantive changes may
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include, but are not limited to changes
in eligible populations, constriction of
service amount, duration or scope, or
other modifications as determined by
the Secretary. We added regulatory
language reflective of our guidance that
section 1915(i) of the Act amendments
with changes that CMS determines to be
substantive may only take effect on or
after the date when the amendment is
approved by CMS, and must be
accompanied by information on how the
State has assured smooth transitions
and minimal adverse impact on
individuals impacted by the change.
In § 441.677(a)(2)(vi), we indicated
that State plan amendments including
targeting criteria are subject to a 5-year
approval period and that successive
approval periods are subject to CMS
approval, contingent upon state
adherence to federal requirements. In
order to renew State plan HCBS for an
additional 5-year period, the state must
provide a written request for renewal to
CMS at least 180 days prior to the end
of each approval period.
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c. Quality Improvement Strategy
We proposed in § 441.677(b)
requirements for quality assurance
which states are required to meet under
section 1915(i)(1)(H)(i) of the Act. We
proposed to require a state, for quality
assurance purposes, to maintain a
quality improvement strategy for its
State plan HCBS benefit. The state’s
quality improvement strategy should
reflect the nature and scope of the
benefit the State will provide. We
proposed that the State plan HCBS
benefit include a quality improvement
strategy consisting of a continuous
quality improvement process, and
outcome measures for program
performance, quality of care, and
individual experience, as approved and
prescribed by the Secretary, and
applicable to the nature of the benefit.
In § 441.677(b), we proposed to require
states to have program performance
measures, appropriate to the scope of
the benefit, designed to evaluate the
state’s overall system for providing
HCBS. Program performance measures
can be described as process and
infrastructure measures, such as
whether plans of care are developed in
a timely and appropriate manner, or
whether all providers meet the required
qualifications to provide services under
the benefit. In § 441.677(b)(1), we also
proposed to require states to have
quality of care measures as approved or
prescribed by the Secretary. Quality of
care measures may focus on program
standards, systems performance, and
individual outcomes.
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Comment: A commenter stated that
the proposed regulations would result
in cut backs, loss of jobs, and
subsequent loss of care for people who
cannot survive without assistance with
all their basic needs.
Response: These regulations explain
requirements for a new provision that
provides states with the option to add
additional HCBS to their state plan.
Since these regulations allow for new
additional services, we do not see how
this would result in the impact that the
commenter suggests.
Comment: One commenter requested
revision to § 441.677(a)(1)(iii) to add to
the requirements advance written notice
and the right to appeal denials.
Response: This provision of this rule
refers to requirements at part 431,
subpart E, which is not a subject of this
regulation. However, since advance
notice is a topic in part 431, subpart E,
we have added ‘‘advance notice’’ to this
regulation at § 441.745(a)(1)(iii).
Comment: One commenter stated the
belief that operating different parts of
the state plan under different rules
would be burdensome to states, and
opposition to § 441.677(a)(2)(v), which
would impose rules for effective dates of
state plan amendments that differ from
current state plan amendment policy.
Response: As explained in the
preamble to the rule, and as required at
§ 441.745(a)(2)(v), state plan
amendments which result in a reduction
of eligibility or services to section
1915(i) of the Act participants must be
submitted with a prospective, rather
than retroactive, effective date. While
this requirement differs from current
SPA procedures, it is consistent with
section 1915(c) of the Act submissions.
And as section 1915(i) of the Act allows
states to add services under section
1915(c)(4)(B) of the Act, we are
requiring states submitting section
1915(i) of the Act SPAs to follow the
same requirements for those section
1915(c) services outlined in CMS CMCS
Bulletin dated April 16, 2012, regarding
actions that result in reductions. If a
state submits an amendment or renewal
to an approved SPA that includes
reductions, the reductions would be
effective for the remainder of the
approved period (once approved), but
cannot be applied retroactively to the
SPA action’s approval date.
Comment: One commenter agreed that
retroactive amendments should not be
available for elimination or reductions
in services, but does not consider
changes to provider qualifications or
rate methodologies to be substantive
changes. The commenter stated that
defining substantive change to include
changes to rate methodology or provider
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2999
requirements prevents states from acting
quickly and efficiently to address
legislative direction or changing state
needs.
Response: We disagree. Since changes
to provider qualifications and/or rate
methodologies could negatively impact
provider availability and result in a
reduction of services to a participant,
we are requiring a state to submit such
SPAs, and receive CMS approval, prior
to implementing any changes of this
nature.
Comment: One commenter stated
disagreement with § 441.677(a)(2)(vi),
limiting approval period for SPAs with
targeting to 5 years and requiring
submission of renewals 180 days in
advance of expiration, and indicated
that these provisions seem contrary to
requirements for services under the state
plan and are like the creation of a new
waiver authority.
Response: Section 1915(i)(7)(B) of the
Act specifies that when a state elects to
target the provision of State plan HCBS
to specific populations, that this
election will be for a period of 5 years.
Therefore, since the 5 year period of
operation with the option to renew is a
statutory requirement, we are unable to
change this provision. Section
1915(i)(7)(C) of the Act permits states to
renew for additional 5 year terms if we
determine prior to the beginning of each
renewal period that the state has
adhered to section 1915(i) of the Act
requirements and that the state has met
its objectives with respect to quality
improvement and individual participant
outcomes. In order for us to determine
that these requirements are met, states
must submit renewal SPAs at least 180
days in advance of expiration in order
to allow us sufficient time to review.
The need for this review timeframe is
consistent with our experience under
section 1915(c) of the Act renewals.
Comment: A few commenters
recommended that CMS add to the
periods of approval requirement for
states that elect to target specific
populations at § 441.677(a)(2)(vi), so
that it specifically includes the statutory
renewal requirement at section
1915(i)(7)(c)(ii) to meet ‘‘the state’s
objectives with respect to quality
improvement and beneficiary
outcomes.’’ They stressed the
importance of quality improvement and
good beneficiary outcomes, and
indicated that a State plan HCBS benefit
should not be renewed if it cannot meet
such criteria.
Response: We agree with these
commenters and have revised
§ 441.745(a)(2)(vi) accordingly.
Comment: We received many
comments regarding the option for
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presumptive payment at
§ 441.677(a)(2)(i), as noted below:
• ‘‘CMS should clarify that home and
community-based services furnished to
individuals in the 3 months prior to a
final determination of eligibility are also
eligible for FFP once eligibility has been
confirmed.’’
• ‘‘Presumptive Eligibility is
confusing, and should not be limited to
evaluations and assessment; however, if
someone needed medical data to prove
eligibility including disability
determination, those services should be
provided.’’
• ‘‘. . . encourages CMS to take this
authority one step further to permit, on
a time limited basis, federal financial
participation for State plan HCBS
furnished to consumers who are
presumptively enrolled.’’
• ‘‘Please clarify that the availability
of Federal financial participation for
medically necessary State plan HCBS
benefit payments under this option
when the individual beneficiary has
been found not to be eligible, allows
states to hold the beneficiary harmless
for the state financial portion.’’
• ‘‘We strongly encourage CMS to use
its discretion, if possible, to include
payment for the HCBS which a state
believes the individual would be
eligible to receive. This expanded
authority is especially important in
emergency situations, such as avoiding
institutional care.’’
• ‘‘We support the creation of
flexibility for states to provide HCBS
based on presumed eligibility for
assessment due to the fact that many
disabilities occur rather suddenly, and
because there is no guarantee as to when
informal support networks may give out
or end.’’
• ‘‘We commend the inclusion of
authority in § 441.677(a)(2) to allow
presumptive payment for HCBS
evaluations and assessments, and the
provision to allow FFP in the cases
where presumptive payment was made
based on good faith.’’
Response: We appreciate these
comments. Section 1915(i)(1)(J) of the
Act gives states the option of providing
for a period of presumptive eligibility,
not to exceed 60 days, for individuals
the state has reason to believe may be
eligible for the State plan HCBS benefit.
However, eligibility for services under
section 1915(i) of the Act is not the
same as an eligibility determination for
Medicaid generally, as this provision
‘‘shall be limited to medical assistance
for carrying out the independent
evaluation and assessment’’ under
section 1915(i)(1)(E) of the Act.
Therefore, for clarity, we refer to this
limited option as ‘‘presumptive
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payment.’’ Since individuals not eligible
for Medicaid may not receive State plan
HCBS, the statutory phrase ‘‘and if the
individual is so eligible, the specific
HCBS that the individual will receive,’’
is further describing the assessment
under section 1915(i)(1)(E) of the Act for
which presumptive payment is
available. Payment for State plan HCBS
is available once the individual is
determined eligible, and not prior to
that point. However, FFP would be
available for both 1905(a) services and
administrative costs incurred for
evaluation and assessment activities for
individuals who are already eligible for
Medicaid. During any such period of
presumptive payment, the individual
would not receive State plan HCBS, and
would not be considered to be enrolled
in Medicaid or eligible for the HCBS
benefit for purposes of computing the
number of individuals being served
under the benefit.
Comment: One commenter requested
clarification as to how states must
ensure people are able to move from a
needs-based criteria benefits package to
benefits that require a level of care.
They also requested guidance to states
as to how they will monitor for
unexpected changes in services and
support needs, which might result in
the need for services associated with an
institutional level of care. They asked
that we provide guidance on time lines
and processes for conducting level of
care assessments as well as for enrolling
individuals in a program or benefit that
requires a level of care that will best
meet their needs.
Response: In order to receive approval
of a section 1915(i) of the Act SPA,
states must establish that the
institutional level of care is based on
needs-based criteria that are more
stringent than the proposed section
1915(i) of the Act needs-based criteria.
Although states are required to establish
minimum needs-based criteria that an
individual would have to meet in order
to receive section 1915(i) benefits, the
statute did not establish a maximum or
ceiling. Therefore, states are permitted
to allow access to those who meet
institutional needs-based eligibility
criteria. We also note that § 441.715(e)
requires states to re-evaluate and reassess individuals receiving the State
plan HCBS benefit at least every 12
months, and when the individual’s
circumstances or needs change
significantly or at the request of the
individual.
Comment: In § 441.677 (a)(1)(i), no
details are provided about how states
would ‘‘project’’ HCBS enrollment. This
is a critical calculation because states
might have an incentive to understate
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projections to gain the discretion
associated with over-enrollment.
Response: We do not believe it is
necessary to include such details in the
regulation. We note that this paragraph
also requires states to report the actual
numbers of unduplicated individuals
enrolled in the State plan HCBS benefit
on an annual basis.
Comment: One commenter
commended CMS on the inclusion of
§ 441.677(a)(1)(ii)(C) prohibiting the
state from limiting access to HCBS
based on income, cost, or location.
Response: We appreciate the support
of the commenter regarding the
inclusion of this requirement which is
now at § 441.745(a)(1)(ii)(C).
Comment: One commenter
recommended that CMS require that
states make publicly available targeting,
phase-in, and quality improvement
plans, including by posting on public
Web sites.
Response: At this time, we do not post
state plans on our Web site. We are
working on a project to make approved
state plans publicly available. We
encourage states to provide for effective
public engagement in all of their
Medicaid program activities, and states
are required to provide 60 day public
notice when states change
reimbursement methodology or revise
CMS approved section 1915(i) of the Act
needs-based criteria.
Comment: A couple of commenters
noted that § 441.677(a)(1)(ii)(B)
incorrectly cross-references
§ 441.656(b)(2), which should be
changed to § 441.656(e)(2).
Response: We appreciate this
comment and have made a revision to
this final rule at § 441.745(a)(1)(ii)(B)
with the corrected cross-reference to
§ 441.710(e)(2).
Comment: One commenter expressed
that CMS should consider requiring
states to report on quality measures
related to home and community-based
settings and community integration for
HCBS provided under sections 1915(k),
1915(c), and 1915(i) of the Act.
Response: We agree. States are
required to demonstrate at the time of
approval that they have quality
measures in place with a monitoring
plan, must include them in the SPA or
waiver, and will report to CMS at a
frequency to be determined by CMS or
upon request by CMS.
Comment: One commenter
emphasized the important role that nonmedical quality measures play in the
meaningful evaluation of HCBS. The
commenter stated that quality measures
should reflect the ultimate mandate
resulting from the Olmstead decision
and the importance of quality of life,
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independence, and community
integration. The commenter further
stated that for those who choose
participant direction, measures sensitive
to this mode of service delivery need to
be implemented, including measures
that recognize the role of participants as
decision makers and evaluators of the
quality of services and supports they
receive.
Response: We recognize the
importance of non-medical quality
measures and will incorporate these
areas (quality of life, community
integration and factors specific to
participant-directed services) in
development of future guidance.
Comment: One commenter noted that
due to reported abuses in some states,
it must be clear that observation of
actual conditions, through on-site
monitoring and review and by
interviews with service recipients and
their advocates and family members,
will be the method used to measure
compliance; and not simply by
reviewing policies, procedures, or
assertions. The commenter further
stated that it is crucial that the final rule
contain the details so CMS has the legal
authority to prevent creation of new
loopholes or allow for misinterpretation.
Response: There may be multiple
methods of monitoring health and
welfare in a quality monitoring plan.
States are required by the regulation to
have a quality improvement strategy
consisting of a continuous quality
improvement process, and outcome
measures for program performance,
quality of care, and individual
experience.
Comment: A commenter inquired
about the applicability of the state
assurances for HCBS waiver programs
required by § 441.302, particularly
§ 441.302(a) Health and Welfare, noting
that there is equivalent vulnerability
potential for individual beneficiaries
receiving HCBS under state plan
authority as under section 1915(c) of the
Act waiver authority.
Response: The regulations noted by
this commenter specifically apply to
section 1915(c) of the Act home and
community-based waiver services and
do not specifically apply to section
1915(i) of the Act State plan HCBS. The
regulations that implement section
1915(i)(1)(H)(i) of the Act, which
requires states to ensure that the
provision of HCBS meets federal and
state guidelines for quality assurance,
can be found in § 441.745(b) and require
that states have a quality improvement
strategy consisting of a continuous
quality improvement process, and
outcome measures for program
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performance, quality of care, and
individual experience.
Comment: One commenter
encouraged CMS to require states to
submit their quality improvement
strategy to CMS at a specific frequency
and consider making such information
public.
Response: We have required through
these regulations that states make this
information available to CMS at a
frequency determined by CMS or upon
the request of CMS. We will consider
further specification of these
requirements in the development of
future guidance.
Comment: One commenter
recommended revision to
§ 441.677(b)(1)(ii) to include the
following language from the preamble in
the text of the final rule: ‘‘Be evidencebased, and include outcome measures
for program performance, quality of
care, and individual experience as
determined by the Secretary.’’
Response: This recommendation has
been adopted in this final rule at
§ 441.745(b)(1)(ii).
Comment: One commenter noted that
in order to determine if there is a
sufficient infrastructure to effectively
implement HCBS, it is necessary for
states to gather direct-care worker data
such as numbers of direct service
workers, gaps in services data, stability
of workforce, and average compensation
of workers.
Response: We agree that this would be
useful data for states to consider in the
development of a State plan HCBS
benefit, but we have not required
specific measures, such as the one
recommended by the commenter.
Comment: One commenter further
encouraged CMS to consider how
quality principles/requirements would
work within the management of long
term services and supports and its
impact on network adequacy.
Response: We appreciate the
commenter’s recommendation and will
take this under consideration as we
develop future guidance.
13. Prohibition Against Reassignment of
Provider Claims (§ 447.10)
Regarding the proposed provider
payment reassignment provision, we
received a total of 7 timely items of
correspondence from home care
provider representatives and other
professional associations, state
Medicaid directors, non-profit
organizations, and other individuals.
These comments ranged from general
support for the proposed provision, to
specific questions and detailed
comments and recommendations
regarding the proposed changes. A
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summary of the public comments and
our responses are set forth below.
The proposed rule included a
provision, retained in this final rule,
that will allow states to enter into third
party payment arrangements on behalf
of individual practitioners for health
and welfare benefit contributions,
training costs, and other costs
customary for employees.
Comment: Several commenters
expressed support for the proposed
provision. Two state Medicaid agency
directors appreciate the clarification
that third party payments on behalf of
certain providers are allowed for
customary benefits. That ability, they
recommend, is essential and costeffective for a large group of individual
providers of personal care.
Response: We appreciate the
commenters’ support for the proposed
provision. CMS has long sought to
ensure maximum state flexibility to
design state-specific payment
methodologies that help ensure a strong,
committed, and well-trained work force.
Currently, certain categories of
Medicaid covered services, for which
Medicaid is a primary payer, such as
personal care services, suffer from
especially high rates of turnover and
low levels of participation. We believe
the proposed provider payment
reassignment provision retained in the
final rule will provide to states
additional tools to help foster a stable
and high performing workforce.
Comment: One commenter stated that
authorizing payments on behalf of an
individual practitioner to a third party
for health and welfare benefit costs,
training costs, or other benefits
customary for employees aligns with
essential elements that they advocate for
quality direct-care jobs. They stated
their belief that this will support state
efforts to expand and improve consumer
employment and direction of in-home
personal care workers. They further
stated that workers need affordable
health insurance, other familysupportive benefits, and excellent
training that helps each worker develop
and hone all skills—both technical and
relational—necessary to support longterm care consumers in order to ensure
that all direct-care workers are able to
provide the highest-quality care to all
long-term care consumers. They believe
that for consumer-directed home care
workers, it is even more vital that states
assume some of the human resources
functions of typical employers.
Response: We appreciate the
commenter’s support for the proposed
provision and agree with its potential to
improve both the stability and the skills
of the health care provider workforce.
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The payment arrangements that we are
permitting will enhance state options to
provide practitioners with benefits that
improve their ability to function as
health care professionals. For the classes
of practitioners for whom the state is the
only or primary payer, these payment
arrangements are an efficient and
effective method for ensuring that the
workforce has health and welfare
benefits and adequate training for their
functioning.
Comment: One commenter stated that
it will be essential for CMS, states,
advocates, program participants, and
organizations to understand how this
proposed rule is appropriately applied
within a participant direction model.
The proposed provision, they suggested,
should by no means be interpreted to
allow for restrictions on participants’
decisions pertaining to what s/he feels
is critical to the managing of workers. In
their own training, program participants
should be informed of the benefits for
which workers are eligible to ensure
informed decisions are made. They
urged that any additional deductions
should be paid for with increased
funding for the program rather than be
paid directly from individuals’ budgets
already allocated to needed services and
supports.
Response: Direct payment of funds by
states to third parties on behalf of
practitioners, to ensure benefits that
support those practitioners and provide
skills training, may help ensure that
beneficiaries have greater access to such
practitioners and higher quality
services. In addition, if a state elects to
withhold certain payments from
practitioners, as the proposed provision
would allow, and forwards those
amounts to a third party on behalf of
that practitioner for health and welfare
contributions, training programs, or in
support of other employee benefits,
there will not necessarily be any impact
on program budgets. This rule will not
require any change in state funding to
the extent that practitioner rates already
factored in the costs of benefits and
skills training. This rule will simply
provide flexibility for states to fund
such costs directly and ensure uniform
access to benefits and skills training for
practitioners. Indeed, there may be cost
savings resulting from the collective
purchase of such benefits and greater
workforce stability.
Comment: One commenter supports
CMS’ objective of clarifying the
prohibition on reassignment in section
1902(a)(32) of the Act to ensure that it
is limited to its intended application
and that it does not have any
unintended adverse impact on
important state Medicaid operations.
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They suggested that states have long
sought this clarification primarily in the
context of state efforts to expand and
improve programs that maximize
consumer choice and independence and
allow individuals to receive long term
care services and supports in their
homes and communities. They stated
that the health care providers who assist
these individuals are considered
independent service practitioners both
due to their relationship to the state and
the consumer, and as a result face
barriers including a lack of access to
benefits and training. It makes sense,
therefore, for states to be able to make
‘‘employer-like payments from the
Medicaid service fee to fulfill employerlike functions’’ that overcome these
employment barriers.
Response: CMS appreciates the
commenter’s support for the proposed
provision and agrees that for the classes
of practitioners for whom the state is the
sole or primary payer, and has many
attributes of an employer, the state
should be afforded flexibilities to help
ensure a stable, high performing
workforce.
Comment: One commenter indicated
that as a future nurse practitioner, she
believes the application of this proposed
provision is timely and she believes it
will support state efforts to claim
‘‘excess provider payments that are not
directly going to the provider but could
be used to advance statewide practice
from a global perspective.’’
Response: We appreciate the
commenter’s support for the proposed
provision. However, we would note that
the proposed provider payment
reassignment provision does not involve
‘‘excess provider payments’’. Rather, as
in the proposed rule, the final rule will
offer states flexibility in determining
appropriate costs to consider in their
development of payment rate
methodologies to ensure adequate
training, health and welfare benefits,
and other benefits customary for
employees within the development of
that rate. States will be permitted to
directly pay third parties for health and
welfare benefits, training, and other
employee benefit costs. These amounts
would not be retained by the state, but
would be paid on behalf of the
practitioner for the stated purpose. In
fact, we believe that direct payment of
funds to third parties on behalf of the
practitioner may be viewed as
advantageous by the practitioner insofar
as they have increased opportunities for
training. In addition, direct payment of
funds to third parties on behalf of the
practitioners may ensure that
beneficiaries have greater access to such
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practitioners and higher quality
services.
Comment: One commenter noted that,
using the proposed provision, Medicaid
can leverage its dominant role and help
stabilize the direct care workforce.
Specifically, the commenter noted that
by encouraging Medicaid to directly pay
practitioners for health and welfare
benefit costs, training, or other benefits
customary for employees, job quality
will improve leading to improving
recruitment and retention of skilled
direct-care workers and better quality
care. The commenter also recommended
that CMS provide states with the
appropriate technical assistance in order
to assist them in adequately conducting
needs assessments of their own directcare workforce.
Response: We agree that states that
voluntarily elect to utilize the proposed
provider payment reassignment
provision may help improve their own
health care provider workforce. We also
agree with the need for states to receive
adequate technical assistance from us in
order to implement the provision. States
with questions regarding the provision
are encouraged to contact their Regional
Office for further guidance.
Comment: One state asked if the third
parties to whom withheld funds are
provided would be subject to the
provisions of part 455, subpart E,
Provider Screening and Enrollment.
Response: No. If the state elects to
reassign provider payments for health
and welfare costs, training expenses, or
other employee benefits, the third party
to whom those payments are assigned
would be the recipient of such funds,
but not the provider of record and hence
not subject to provider qualification
requirements. The amounts paid to a
third party would be on behalf of the
individual practitioner.
Comment: One commenter seeks
clarification as to what would constitute
a health and welfare benefit
contribution. Specifically, one state
would like to know if this would
include amounts for paid time off for
personal care attendants.
Response: The proposed change,
retained in the final rule, permits each
state the option to elect such payment
arrangements to the extent that the state
determines that they are related to
benefits such as health care, skills
training and other benefits customary
for employees. States will need to
review their individual circumstances
and workforce needs to determine if the
measures are related to such benefits,
and would help serve program
objectives such as to ensure a stable,
high performing workforce. We do not
wish to prescribe the types of benefits
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the state might wish to include in its
definition of health and welfare
benefits, such as paid time off for
personal care attendants. As in the
proposed rule, the final rule offers states
flexibility in determining appropriate
aspects to consider in their development
of payment rate methodologies to ensure
adequate training, health care, and other
employee benefits for practitioners, as
defined by the state.
Comment: One commenter requested
a modification to the proposed
regulatory text for the provider payment
reassignment provision to avoid a
possible misunderstanding as to its
coverage. Specifically, the commenter
recommended a change to clarify that it
is applicable to providers for whom the
main source of service revenue is the
Medicaid program. As proposed, the
language states that the provider
payment reassignment exception is ‘‘[in]
the case of practitioners for which the
Medicaid program is the primary source
of revenue . . .’’ Without such
clarifying language, the commenter
recommends, a state may not be able to
make deductions for health care,
training, and other benefits that it
provides for individuals who operate
adult foster care homes in their
residences. Since the consumer pays the
provider for room and board in that
instance, the provider’s primary source
of revenue may not be considered to be
the Medicaid program.
Response: We have clarified the
language in the final rule by specifying
that the state must be the primary
source of service revenue for the
practitioner. The proposed regulatory
text would permit states to make
payment to third parties for provider
benefits when the state is operating in
the role of the provider’s employer
(even if the state is not the employer for
other purposes). As clarified, the text
will provide flexibility for a state to look
at revenue only related to services
furnished by the practitioner, rather
than revenue related to shelter and food
costs. We believe the proposed
regulatory text, which we are retaining,
provides the necessary latitude for states
to determine whether it is acting in the
role of an employer for a particular class
of practitioners.
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III. Home and Community-Based
Services (HCBS) Waivers (Section
1915(c) of the Act)
A. Background
Section 1915(c) of the Social Security
Act (the Act) authorizes the Secretary of
Health and Human Services to waive
certain Medicaid statutory requirements
so that a state may offer Home and
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Community-Based Services (HCBS) to
state-specified group(s) of Medicaid
beneficiaries who otherwise would
require services at an institutional level
of care. This provision was added to the
Act by the Omnibus Budget and
Reconciliation Act of 1981 (Pub. L. 97–
35, enacted August 13, 1981) (OBRA’81)
(with a number of subsequent
amendments). Regulations were
published to effectuate this statutory
provision, with final regulations issued
on July 25, 1994 (59 FR 37719). In the
June 22, 2009 Federal Register (74 FR
29453), we published the Medicaid
Program; Home and Community-Based
Services (HCBS) advance notice of
proposed rulemaking (ANPRM) that
proposed to initiate rulemaking on a
number of areas within the section
1915(c) of the Act program. In the
proposed rule published on April 15,
2011 (76 FR 21311–21317), we
discussed the comments relating to
questions posed by the ANPRM, which
are addressed in this final rule. We
included proposed language for settings
in which HCBS could be provided to
elicit further comments on this issue in
the section 1915(c) of the Act proposed
rule, in the section 1915(k) of the Act
proposed rule published on February
25, 2011 and also in the section 1915(i)
of the Act proposed rule published on
May 3, 2012 as we recognize the need
for a consistent definition of home and
community-based settings. It is our goal
to align the final rule language
pertaining to home and communitybased setting across the sections
1915(c), 1915(i) and 1915(k) of the Act
Medicaid HCBS authorities. We further
sought to use this opportunity to clarify
requirements regarding timing of
amendments and public input
requirements when states propose
modifications to HCBS waiver programs
and service rates, and strategies
available to CMS to ensure state
compliance with the requirements of
section 1915(c) of the Act.
We have earlier explained our
purpose for proposing definitions
regarding home and community-based
settings (see discussion under section
II.A. of this rule).
We believe that these final changes
will have numerous benefits for
individuals and states alike. In addition
to addressing individual and
stakeholder input, these changes will
improve HCBS waiver programs and
support beneficiaries by enabling
services to be planned and delivered in
a manner driven by individual needs
rather than diagnosis. These changes
will enable states to realize
administrative and program design
simplification, as well as improve
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efficiency of operation. The changes
related to clarification of HCBS settings
will maximize the opportunities for
waiver participants to have access to the
benefits of community living and to
receive services in the most integrated
setting, and will effectuate the law’s
intention for Medicaid home and
community-based services to provide
alternatives to services provided in
institutions.
B. Provisions of the Proposed
Regulations and Analysis of and
Responses to Public Comments
On April 15, 2011, we published a
proposed rule (76 FR 21311) entitled,
‘‘Medicaid Program: Home and
Community-Based Services (HCBS)
Waivers’’ which proposed revising the
regulations implementing Medicaid
home and community-based services
under section 1915(c) of the Act in
several key policy areas. First, the
proposed rule provides states the option
to combine the existing three waiver
targeting groups as identified in
§ 441.301. In addition, we proposed
changes to the HCBS waiver provisions
to convey requirements regarding
person-centered service plans,
characteristics of settings that are, as
well as are not, home and communitybased, to clarify the timing of
amendments and public input
requirements when states propose
modifications to HCBS waiver programs
and service rates, and to describe the
additional strategies available to us to
ensure state compliance with the
statutory provisions of section 1915(c)
of the Act.
We received a total of 1653 comments
from State Medicaid agencies, advocacy
groups, health care providers,
employers, health insurers, and health
care associations. The comments ranged
from general support or opposition to
the proposed provisions to very specific
questions or comments regarding the
proposed changes.
Brief summaries of each proposed
provision, a summary of the public
comments we received (with the
exception of specific comments on the
paperwork burden or the economic
impact analysis), and our responses to
the comments are as follows.
The following summarizes a few
general comments received regarding
the notice of proposed rulemaking and
also comments regarding issues not
contained in specific provisions. We
appreciate and thank the commenters
for these various remarks. We realize
these commenters raise important
considerations in support of persons
receiving Medicaid HCBS living in
community settings, in integrated
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settings, and working in jobs with
meaningful wages. Since these
important comments did not address
any specific regulatory provisions in the
proposed rule, there is no need to
respond to them further in the final rule:
Comment: We received many
comments supporting the proposed
policies in the proposed rule, as well as
some comments expressing concerns
about the various aspects of the rule.
Response: We appreciate the feedback
received on the proposed rule and have
relied heavily on the insights provided
by states, advocacy groups, consumers
and health care providers. We
appreciate the acknowledgement and
support of the policies.
Comment: We received several
comments expressing concern about
stakeholder input with respect to these
rules.
Response: We recognized the need for
a diversity of stakeholder input. Thus,
in the June 22, 2009 Federal Register
(74 FR 29453), we released an advance
notice of proposed rulemaking that
proposed to initiate rulemaking on a
number of areas within the section
1915(c) of the Act program and to solicit
diverse comment. Additionally, after we
published the proposed rule on April
15, 2011 (76 FR 21311), we continued
to meet with stakeholders that included
advocacy groups, states, other federal
agencies, provider groups and assisted
living groups as we developed this rule.
We plan to continue to communicate
with states and build upon state
experience as we work with states to
implement new policies and program
changes as a means of ensuring a
successful partnership between states
and federal government. In addition, we
will provide technical assistance and
support to states. We encourage states to
share across states as implementation
continues. The public comments we
receive will inform the development of
future operational guidance and tools
that will be designed to support state
implementation efforts.
1. Contents of Request for a Waiver
(§ 441.301)
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a. Person-Centered Planning Process
§ 441.301(c)(1) (Proposed
§ 441301(b)(1)(i)(A))
The provisions of this final rule will
apply to all states offering Medicaid
HCBS waivers under section 1915(c) of
the Act. Comments were supportive of
our interest in setting forth requirements
regarding person-centered service and
support plans that reflect what is
important to the individual. The final
revisions to § 441.301(c)(1) (proposed
§ 441.301(b)(1)(i)(A)) will require that a
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written services and support plan be
based on the person-centered approach.
This provision includes minimum
requirements for this approach.
At § 441.301(b)(1)(i)(A) we proposed
that a state request for a waiver must
include explanation of how the state
will use a person-centered process to
develop a written services and support
plan, subject to approval by the
Medicaid agency. We received 286
comments about person-centered
planning, most indicating how
important it is to individuals that HCBS
are provided in a manner that supports
their values and preferences, rather than
to satisfy an impersonal or providercentered plan of care. In the comments
immediately below we outline the
suggestions that do not directly affect
the regulatory language, and indicate in
some cases where we will consider
these ideas in developing future
guidance. Comments that pertain to the
proposed regulation language will be
considered in more detail, under the
corresponding section of proposed text.
Comment: Many of the comments had
to do with effective methods for
conducting an individual personcentered planning meeting. While some
commenters seemed to favor requiring
certain features, a variety of commenters
made the opposite general point,
cautioning that too many or overly
specific requirements would cause the
process to become bureaucratic instead
of personal. Comments that specific
proposed provisions are too prescriptive
are noted in those sections below. A few
commenters agreed with the concept,
but not the language of the proposed
person-centered planning rule. They
suggested replacing the entire personcentered planning section with the
language ‘‘contemporary, promising
practices that result in consumers
having control over the services,
resources, and planning of their lives.’’
Finally a few commenters believe that
the proposed changes implement a ‘‘one
size fits all’’ ideology.
Response: States administer Medicaid
and have flexibility in how federal
Medicaid requirements are
implemented. Therefore, the language
we are including in the final rule
expresses what must occur rather than
how. The federal regulations set the
requirements and minimum standards
for an activity. We may issue, as needed,
additional guidance to states to assist in
the interpretation and implementation
of the rule.
Comment: Some commenters
requested general clarification of terms
and illustration by example.
Specifically, commenters presented
questions around how person-centered
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planning is to be implemented and
whether any substantive rights are
established for the individual.
Response: Examples and other
explanations are generally included in
the preamble to a notice of proposed or
final rulemaking rather than in the
regulation text. The commenter is
correct that beyond the requirements in
subparagraph (A) we do not specify how
the planning process is to be
implemented, for the reasons given
immediately above. The commenter did
not specify the particular rights of
concern, so we cannot respond
specifically to that issue. We consider
the requirements outlined here to confer
to individuals the right to a personcentered service plan, and a planning
process, that meets these requirements.
Individuals also have other rights under
different authorities, which do not rely
on this regulation. For example, civil
rights against various forms of
discrimination are protected under the
ADA and elsewhere. CMS regularly
works with the HHS Office for Civil
Rights, Department of Justice (DOJ), and
others to assure that we address civil
rights issues as they bear on Medicaid
requirements.
Comment: Many and varied
commenters suggested that CMS make
person-centered planning requirements
consistent across all the authorities in
which HCBS may be offered, such as the
new Community First Choice program
and the State Plan HCBS benefit.
Specific language from proposed rules
for those authorities was recommended.
Response: We agree that personcentered planning, as well as other
HCBS requirements, should be
consistent across authorities. In
response to comments, proposed rules
for some HCBS authorities have been
published in the last several years,
reflecting development in the concept of
person-centered planning. We are
working to bring all rules into harmony.
We do point out that rules reflect the
nature of the service—for example,
planning for Community First Choice
involves the plan for that particular
service, and may not involve some of
the program elements of a section
1915(c) of the Act HCBS waiver. We
will endeavor to make the requirements
parallel across authorities; however,
they may not be identical due to some
statutory differences.
Comment: A variety of commenters
requested that the planning process
consider the needs of individuals more
than satisfying regulations or ‘‘papercompletion.’’ Many asked that the
regulation focus on outcomes, not
process.
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Response: We agree that the planning
process should not be about filling out
forms. The final rule requires actions
and outcomes that result in a very active
process and an individualized plan that
is not focused on paper completion. We
also note that the degree to which the
process achieves the goal of personcenteredness can only be known with
appropriate quality monitoring by the
state, which should include substantial
feedback provided by individuals who
received or are receiving services.
Comment: A commenter believes that
these requirements will be very
expensive for states to implement
because of added staff and IT system
costs. The requirements should take into
account states’ current budget problems.
Response: States are currently
required to develop a plan of care
sufficient to meet HCBS waiver
participants’ assessed needs for health
and welfare. We do not believe the
provisions in these regulations will
significantly increase burden and note
that investment in effective information
technology, with federal financial
participation, will increase efficiency.
In § 441.301(b)(1)(i)(A)(1) through (7),
we proposed requirements for the
Person-Centered Planning Process.
Following are general comments we
received on these requirements.
Comment: Several commenters
objected to the term ‘‘plan of care,’’
which they believe dismisses active
person controlled service planning, and
would prefer something about
outcomes.
Response: The regulatory text reads,
‘‘. . . . a written person-centered
service plan (also called plan of care)
that is based on a person-centered
approach. . . .’’ The term plan of care
is widely used, and reflected in waiver
application documents. We indicated
parenthetically that we are not referring
to another separate process, but to that
function we have until now called plan
of care. While we do not agree that
either term necessarily implies lack of
individual control, we agree that
‘‘person-centered service plan’’ is
superior because it is less medical in
connotation and conveys that it is a plan
for long term services and supports and
it is developed with a person-centered
process. We will change the term ‘‘plan
of care’’ to ‘‘person-centered service
plan.’’ Also, as noted in more specific
comments below, many commenters
wanted stronger language about the
individual leading the process. We
believe the phrase ‘‘led by the
individual’’ clearly indicates that the
individual is leading the process;
however, we have further revised the
language to read ‘‘led by the individual
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receiving services and supports’’ instead
of ‘‘led by the individual receiving
services.’’ Throughout the rest of the
section, we will change any references
to ‘‘services’’ or ‘‘supports’’ to ‘‘services
and supports.’’
Comment: Some commenters objected
to mandating person-centered planning
on two grounds: some individuals may
not want it, and some individuals may
not be able to do it. They believe that
CMS was assuming both interest and
ability would be present in all HCBS
participants. Some commenters listed
specific disabilities they believe limit
cognitive or expressive ability to such
an extent that the individual could not
lead the process.
Response: With regard to the issue of
choice, the regulation language does not
require individuals to be more involved
than they choose to be in their own
planning processes. Individuals may
decline to participate in the process if
they so choose. Regarding the issue of
ability, we noted that commensurate
with the level of need of the individual,
the person-centered service plan must
reflect the service and support needs as
identified through a person-centered
functional assessment. Individuals may
select another person(s) to assist or
represent them in the process. In
addition, where state law confers
decision-making authority to a legal
representative, such as a guardian, that
individual may direct the personcentered planning process on behalf of
the individual.
Following are the comments we
received on § 441.301(b)(1)(i)(A)(1) of
the proposed rule, which is
§ 441.301(c)(1)(i) of the final rule.
Comment: Quite a few commenters
urged that the individual be allowed to
choose who attends the meeting. Many
stated that a person-centered service
plan should provide freedom from
unwanted intrusion in preferences and
choices which could be from family,
providers and professionals, or others.
In other words, the individuals should
have ‘‘veto power.’’
Response: We believe the language in
the final rule clearly indicates that
individuals are allowed to choose who
does or does not attend the meeting; we
are therefore retaining the proposed
language.
Comment: Most of the comments
about assuring that certain persons
could be present concerned the role of
guardians and legal representatives or
chosen surrogates. Some wanted these
terms defined and roles specified,
especially ‘‘legal’’ representative and
attorneys. Others wanted to be sure that
the rule allows for representatives who
are not a legally designated
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representative, but might be a family
member, friend, advocate, or other
trusted person chosen by the individual.
Another asked for a statement that a
public guardian may not act as the
designated representative due to the
inherent unavoidable conflict of
interest. Several commenters believed
that the participation of various
surrogates would result in them, not the
individual, leading the planning
process. A few also asserted that
parental and guardian authority
prevents abuses by professionals in the
person-centered planning (PCP) process.
A few commenters believed that the
proposed rule reduces the authority of
a parent or guardian in the PCP process,
as the Medicaid manual previously
entitled them. Several other very
specific suggestions were made for
requirements applicable to
representatives.
Response: Our omission of explicit
mention of representatives and other
surrogates was not intentional and did
not signal any intention to exclude them
from among those whom individuals
may choose to include in planning. Any
references in this rule to ‘‘individuals’’
include the role of the individual’s
representative. We are aware of the
essential role that representatives,
guardians, and family members play in
the lives of some individuals with
receiving Medicaid HCBS. We are also
aware of the published literature on the
problem and conflicts of interest that
occur, particularly with publicly
appointed guardians in some
jurisdictions. We proposed in
§ 441.301(b)(1)(i)(A)(5) a process for
identifying and resolving conflicts of
interest. We do not agree with those
who expressed the belief that guardians
would lead the planning process,
instead of the individual. Though we
recognize that some individuals without
receptive or expressive communication
depend on others to determine and
articulate their needs, we will continue
to speak of the individual as being in
the center. Therefore, we have revised
the rule to clarify the expectation that
the individual will lead the planning
process where possible and that the
legal representative should have a
participatory role, as needed and as
defined by the individual, unless state
law confers decision-making authority
to the legal representative. We note that
the term ‘‘individual’s representative’’ is
also defined under 1915(i) State plan
HCBS regulations at § 441.735 of this
rule, and further note that this rule does
not abridge the legal authority of a
parent or legal guardian.
Comment: Two commenters stated
that CMS appears to attempt to regulate
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unpaid family members and friendly
volunteers by including them in the
rule. Another concern is that including
lay persons could violate confidentiality
protections for the individual.
Response: We do not agree that the
rule inadvertently regulates unpaid
participants in the planning process in
a general or undesirable manner. Rather,
we intend that individuals have a
meaningful choice of who can assist
them in the planning process. We also
see no reason to believe that states will
relax their responsibility to protect
client confidentiality in this process.
The individual chooses who
participates in the planning process,
and thus retains direct control over who
has access to private information.
Following are the comments we
received on § 441.301(b)(1)(i)(A)(2),
which is now § 441.301(c)(1)(ii) of the
final rule.
Comment: Commenters pointed out
that the proposed language is
ambiguous. Several commenters
recognized the intent of the proposed
regulation to strengthen the personcentered service plan development
process, but were concerned that the
language undermines the progress made
to empower people with disabilities in
their planning process. Commenters
expressed concern that playing a
‘‘meaningful role’’ is not the same thing
as authority for decision making.
Several comments indicated a belief that
at least some HCBS participants cannot
lead or even contribute to the service
plan; several specifically mentioned
people with intellectual disabilities or
dementia. A few suggested specific
supports, such as decision making tools
and communications support.
Response: We do not intend a shift
from the individual directing the
process. We agree that the language
should be clarified. ‘‘Meaningful’’ is a
subjective standard. We will clarify that
the person-centered planning process
provides necessary information and
support to ensure that the individual
directs the process to the maximum
extent possible, and is enabled to make
informed choices and decisions. We
believe the language ‘‘to the maximum
extent possible’’ reflects the level at
which the individual desires or is able
to participate. We believe that with
skillful facilitation, individuals can
express themselves to their fullest
extent.
Many commenters urged us to favor
empowering the individual; others
urged empowering those who believe
they have the best insight into the
individual’s needs and wishes. The
regulation does not put these interests
in competition. This final rule requires
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a process that puts the individual in the
center, driving the process to the extent
feasible, and recognizes the other
persons’ insights into the individual’s
strengths, needs, and preferences. The
supports help to identify and sort out
differing views among those present. At
§ 441.301(c)(1)(v) we discuss further the
role of the facilitation process in
managing disagreements and the
inherent differences in self-interest
present in any diverse team.
We agree that some of the specific
types of support commenters suggested
will be valuable for some individuals,
but we do not prescribe in regulation all
the specific supports that can be offered.
These vary according to many factors
including the type of disability.
We have revised this final rule to
read: ‘‘Provides necessary information
and support to ensure that the
individual directs the process to the
maximum extent possible, and is
enabled to make informed choices and
decisions.’’
Comment: We received a few
comments expressing opposite views on
professionals participating in the
planning. Two commenters did not
believe that a planning process can
include professionals and be personcentered because the individual will not
direct the process. Others requested
adding a provision to assure that the
planning process is facilitated by a
professional trained and skilled in
person-centered planning techniques,
possibly an independent facilitator.
Response: Person-centered service
planning is a complex concept and
requires both commitment and skill to
implement. We agree that if
professionals take control from
individuals in the planning process, the
requirements of this rule will not have
been met. We do not agree that it is
impossible for professionals to
participate in the process appropriately.
Indeed, as in many professional
disciplines, the values, ethics, and the
evolution of best practices in the
profession offer the best means of
consistently implementing a process
that supports and serves the individual.
We require that supports be available to
assist all individuals in leading the
planning process, and sometimes those
supports include professionals skilled
in facilitation. We believe the revised
language is sufficiently clear in that it
states an outcome—the individual
directs the process, with supports if
needed.
Following are the comments we
received on § 441.301(b)(1)(i)(A)(3),
which is now § 441.301(c)(1)(iii) of the
final rule.
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Comment: We received relatively few
comments in response to this provision.
Some commenters stated that the time
and location preference only belonged
to the individual, or that it should occur
only in the individual’s home, while
others pointed out that the logistics
should be negotiated with all
participants. Some wanted more
specificity, including whether the
process must always be face to face;
others believe the rule to be too
prescriptive. We also address here a
comment that the rule lacks any
requirement for timeliness.
Response: As proposed, the regulation
text aims to address a problem
significant numbers of waiver
participants may have experienced: that
the planning process is scheduled
entirely at the convenience of the state
and/or provider agency. This language
is silent about the convenience or
preference of other participants, and we
do not agree that silence precludes
taking these and other factors into
account. We agree that timeliness is
important. When individuals rely
heavily on services and supports,
waiting to update a plan in response to
a changed need could be a significant
hardship or even a danger. Because the
need for planning can range from urgent
to optional, we do not believe it is
appropriate or helpful to specify time
frames in regulation. However, we are
revising this provision in the final rule
at§ 441.301(c)(1)(iii) as follows: ‘‘Is
timely and occurs at times and locations
of convenience to the individual.’’
Following are the comments we
received on § 441.301(b)(1)(i)(A)(4),
which is now § 441.301(c)(1)(iv) of the
final rule.
Comment: Several commenters
suggested that the regulation be more
specific and more clearly articulate and
strengthen ‘‘cultural considerations,’’
include more detailed state
responsibilities, and offer translation
services in the individual’s first
language. No comments objected to this
provision specifically.
Response: We have added text to
specify that a State’s waiver request
include how the person centered
planning process is accessible to
persons who are LEP and persons with
disabilities, consistent with the
Medicaid programmatic accessibility
provision at § 435.905(b).
Following are the comments we
received on § 441.301(b)(1)(i)(A)(5),
which is now § 441.301(c)(1)(v) of the
final rule.
Comment: Several commenters asked
that we clarify this statement, including
how to implement it and the types of
conflict anticipated. Many comments
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suggested types of disagreement or
conflicts of interest to address,
including interpersonal disagreement,
denial or reduction in service, failure to
implement the plan or comply with
regulations, and whether providers have
an inherent conflict and should not be
present.
Response: We do not think that
additional clarification is appropriate in
the regulation. Furthermore, states can
exercise multiple strategies to comply
with this requirement.
We note that some commenters
confused a provider being in attendance
with a provider being in charge of the
process or the plan. The latter (a
provider being in charge of the process
or plan) is not appropriate; the former
(the provider being in attendance)
depends on the circumstance and is not
a matter subject to blanket requirements.
Individuals may choose, or not, to
include a provider of service in the
planning team. In some situations a
direct care worker or a therapist has
worked so long and closely with the
individual that his or her perspective is
very important. Also, some providers
point out that they should be able to
voice any limits in what they can
provide, so that a plan for someone with
intense need does not commit providers
to services they are not able to provide.
In other situations, for example, if the
individual is anxious about
repercussions from voicing problems, or
has a tendency to defer to a provider,
that provider’s presence would be
detrimental. Clearly some actions, such
as intimidating the individual, are
unacceptable.
We do not believe it is possible to
define more specific conflict of interest
requirements that would be meaningful
in the variety of arrangements currently
used to develop person-centered service
and support plans. We have
strengthened the language by requiring
that the state devise clear conflict of
interest guidelines addressed to all
parties who participate in the planning
process.
Comment: Several commenters asked
to strengthen the provision by requiring
case managers to be independent of any
service provider, as an assurance that
the individual’s goals and services will
be appropriate, and will reduce actual
or potential conflicts of interest. Others
indicated that we do not define conflict
of interest.
Response: We agree that complete
independence of the person(s)
facilitating the planning process is
important to promote the statutory
objectives. In the final rule, we have
added an additional requirement to the
person-centered planning process at
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§ 441.301(c)(1)(vi) to address conflict of
interest.
Following are the comments we
received on § 441.301(b)(1)(i)(A)(6),
which is now § 441.301(c)(1)(vii) of the
final rule.
Comment: One commenter stated that
current overarching Medicaid
regulations already require full freedom
of choice of qualified providers and
CMS requires that states document that
individuals have been offered freedom
of choice. This is duplicative.
Response: The regulations at § 431.51
describe the various statutory bases for
the free choice of provider, and specify
the requirements and exceptions to the
principle. The phrase ‘‘full freedom of
choice,’’ however, is not from existing
regulation. We assume the commenter’s
reference to a documentation
requirement pertains to the section
1915(c) of the Act requirement that
waiver participants be offered the
choice of institutional alternatives to
HCBS options in the waiver, which is
unrelated to being informed of noninstitutional service alternatives. Some
persons with disabilities and their
advocates have described the experience
of ‘‘choice’’ in long term services and
supports as being considerably different
than that of a Medicaid beneficiary
looking through a list of participating
acute or general health care providers.
We believe that a person-centered
planning process should include
providing the individual information
about the services and supports relevant
to their particular needs and goals.
Comment: Individuals receiving long
term services and supports and their
families discussed the experience of
both being presented with options and
not being given choices. Comments
noted that individuals wish to be
respected and offered choices, rather
than others deciding what may be best
for them. On the other hand, being
presented with an exhaustive list of
theoretical options and a directory of
providers is overwhelming and not very
useful, a familiar experience to many
people negotiating a new health care
need. One comment stated, ‘‘Ensure the
person has the support he or she needs
to understand all of the choices and
options, their rights, and what they are
agreeing to.’’ Some commenters
suggested adding the word ‘‘informed’’
before ‘‘choices,’’ as this would be more
consistent with the ADA.
Response: We agree that it is difficult
to articulate a rule that ensures a perfect
balance between too much and too little
information. We believe that taken as a
whole, the requirements in this final
rule make clear that the process of
planning services and supports puts the
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person at the center of a highly
individualized process. We agree with
the suggestion to change ‘‘Offers
choices’’ to ‘‘Offers informed choices.’’
Individuals should be informed of all
the possibilities from which they may
choose, as well as the consequences of
those choices, in a manner that is
meaningful to the recipient and easily
understood.
Comment: Several suggestions were
made regarding specific issues or
special circumstances regarding
individual choice, including
documentation of court orders or other
legal issues, identification of rights, and
linkage to entitlements or resources
other than Medicaid.
Response: These suggestions appear
to be good practices, but too detailed for
regulation. We will consider them in the
context of our ongoing efforts to provide
information about best practices.
Following are the comments we
received on § 441.301(b)(1)(i)(A)(7),
which is now § 441.301(c)(1)(viii) of the
final rule.
Comment: Two commenters pointed
out that ‘‘as needed’’ may or may not
include periodic scheduled updates,
and does not address the timeframe
within which a requested update be
accomplished. They suggested changing
the language to: ‘‘Include opportunities
for periodic and ongoing plan updates
as needed and/or requested by the
individual and a time frame for
reasonably scheduling meetings
requested by the individual.’’ One
suggestion was to define timeliness in
terms of the individual’s goals. Another
asked to make explicit that all
individuals participating in the
planning process be contacted so that
they can be kept up to date.
Response: This section proposed a
process requirement, having to do with
informing the individual about what
steps to take to schedule an update to
the plan. We do not address timeliness
regarding the response to request, as we
are not able to set a single national
standard that would be applicable
across all HCBS waivers in the country.
States must respond to urgent needs
more quickly than to other types of
requests, in order to meet the health and
welfare requirements of the HCBS
waiver program. States could
accomplish this through an expedited
process. Requiring that plan participants
be notified when an update is scheduled
has merit. However, given the
requirements concerning who
participates in the plan, who should
sign the plan, and who should have
copies of the plan, we cannot construct
a notification policy that respects the
various levels of confidentiality and
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disclosure that may be required in some
cases. At this time we believe that the
individual or individual and
representative should control
notification about updates, consistent
with the control they have under item
(1) over who participates in the
planning process.
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b. Person-Centered Service Plan
§ 441.301(c)(2) (Proposed
§ 441.301(b)(1)(i)(B))
At § 441.301(b)(1)(i)(B) we proposed
that the Person-Centered Service Plan
must include specific content. After
further review, we believe the
requirement at § 441.301(b)(1)(i)(A)(3)
regarding timeliness and this
requirement at § 441.301(b)(1)(i)(A)(7)
regarding a method for individuals to
request updates to the plan are
sufficient and respectful of the
individual’s timeframe as reflected in
the person-centered planning process.
Therefore, we are removing the
requirement at § 441.301(b)(1)(i)(A)(3)
regarding a timeline for review because
this will now be addressed through the
requirements at § 441.301(c)(1)(iii) and
(c)(1)(viii)).
Following are the comments we
received on § 441.301(b)(1)(i)(B)(2),
which is now § 441.301(c)(2)(iii) of the
final rule.
Comment: A commenter stated that a
‘‘person-centered functional
assessment’’ is superior to a disability or
diagnosis-based assessment. Another
pointed out that ‘‘person-centered
functional assessment’’ is not
recognized terminology and suggested
‘‘individual assessment appropriate to
the age and circumstances of the
person’’ instead.
Response: We agree with parts of both
comments. Applying ‘‘person-centered’’
to ‘‘functional assessment’’ is incorrect.
Although in a general sense all long
term service and support activities are
to be centered on the person and not the
provider, a functional assessment is
objective. We also agree with the
comment that ‘‘functional’’ assessment
imparts an important distinction from
other forms of evaluation such as
diagnostic assessment. We therefore
modify the proposed language to
‘‘through an assessment of functional
need.’’
Following are the comments we
received on § 441.301(b)(1)(i)(B)(3),
which is now § 441.301(c)(2)(iv) of the
final rule.
Comment: A commenter pointed out
that there is no specific mention of
mental health. Many comments in
various sections mentioned that the rule
should focus on outcomes.
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Response: We agree with both
observations. We recognize that we
cannot provide an exhaustive list to
reflect an individual’s identified goals.
Therefore, we are removing the
examples and we are revising the final
rule at § 441.301(c)(2)(iv) by adding
‘‘desired outcomes.’’
Comment: Related to the proposal to
define home and community-based
settings, we received many suggestions
that the person-centered plan address
the issue of housing and living
arrangement in a definite manner. The
proposed list of example goals included
‘‘community living’’ but this was not
believed to sufficiently capture the
complexity of housing and services
issues.
Response: We appreciate the
thoughtful comments and agree that this
important subject warrants a separate
item in the list of the plan content. We
will add a new requirement at
§ 441.301(c)(2)(i) to read: ‘‘Reflect that
the setting in which the individual
resides is chosen by the individual The
state must ensure that the setting chosen
by the individual is integrated in,
supports full access of individuals
receiving Medicaid HCBS to the greater
community, including opportunities to
seek employment and work in
competitive integrated settings, engage
in community life, control personal
resources and receive services in the
community to the same degree of access
as individuals not receiving Medicaid
HCBS.’’
Following are the comments we
received on § 441.301(b)(1)(i)(B)(4)
which is now § 441.301(c)(2)(v) of the
final rule.
Comment: We received few comments
on this requirement. One commenter
suggested replacing this language with
‘‘Respect and honor the choices made
by the individual regarding supports.’’
Another suggested adding the ‘‘full
range’’ of services and supports. Others
commented on or requested clarification
about unpaid services, or urged us to
clarify that unpaid services must not be
required.
Response: We believe that natural
supports and other unpaid services
must be included in order to have a
comprehensive plan reflecting all the
services and supports required. The
availability of unpaid supports may
change from time to time and the plan
must be written so as to be able to adjust
the proportion of formal and informal
supports without starting over at
assessment. The planning process must
not compel unpaid services. We have
included the term ‘‘natural supports’’ in
the regulation text at § 441.301(c)(2)(v)
and have added the following sentence:
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‘‘Natural supports are unpaid supports
that are provided voluntarily to the
individual in lieu of section 1915(c)
HCBS waiver services and supports.’’
We do not believe other wording
suggestions are required to achieve the
intended meaning.
Following are the comments we
received on § 441.301(b)(1)(i)(B)(5),
which is now § 441.301(c)(2)(vi) of the
final rule.
Comment: Comments supported the
proposed language. We choose to
address here similar comments on
several sections of the proposed rule.
Some commenters were concerned that
in taking care to protect freedoms, the
regulation did not provide for reducing
risk due to certain kinds of disabilities.
Dementia was mentioned most often,
with many examples of why some
believe individual freedoms may need
to be curtailed to prevent wandering,
injury with cooking equipment and so
on.
Response: Based on the comments
received, we conclude that additional
language is needed to ensure that
reducing risk for individuals receiving
Medicaid HCBS does not involve
abridgement of their independence,
freedom, and choice either generally or
at the spontaneous decision of persons
providing services and supports.
Restricting independence or access to
resources is appropriate only to reduce
specific risks, and only when
considered carefully in the personcentered service plan. The personcentered planning process required in
this regulation will engage the
individual and others involved in the
planning process as fully as possible in
making these difficult but necessary
decisions. As comments indicated, there
may be a need for immediate action in
emergent or changing circumstances—
that is the purpose of backup strategies.
In thinking through risk, the planning
team will identify temporary measures
to be used if needed, and then update
the plan when needs have stabilized.
Back-up strategies are to be
individualized to the unique mix of
risks, strengths, and supports
represented by each waiver participant.
We will articulate this in the final rule
by amending the language at
§ 441.301(c)(2)(vi) to read: ‘‘Reflect risk
factors and measures in place to
minimize them, including
individualized backup plans and
strategies when needed.’’ We have also
added at § 441.301(c)(2)(xiii) that any
modification of the additional
conditions must be supported by a
specific assessed need and justified in
the person-centered service plan, and
specified what must be documented in
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the person-centered service plan in
these instances.
Following are the comments we
received on § 441.301(b)(1)(i)(B)(6),
which is now § 441.301(c)(2)(ix) of the
final rule.
Comment: Many comments on this
requirement addressed the variety of
persons who may be involved in
formulating the plan and in carrying it
out, any of whom may have complex
relationships with the individual and
each other. Some comments were
primarily concerned with being
inclusive, and in clearly communicating
the plan for services to all involved;
they noted that a person-centered plan
is only effective if the people providing
supports know what is included in the
plan. Other comments were primarily
concerned with privacy and control
over personal information, noting that it
is inappropriate to have an individual
commit intimate details to paper (such
as goals, hopes for personal
relationships, etc.) and then require
everyone involved in that person’s
care—no matter their role—to read, sign,
and keep a copy. Many comments dealt
with both signing and distributing the
plan, but we address these comments
separately.
Response: In response to the
commenters’ concerns about privacy
and control over personal information,
we have clarified in the final rule who
will sign the plan and who will receive
copies of the plan by revising
§ 441.301(c)(2)(ix)) as follows: ‘‘Be
finalized and agreed to, with the
informed consent of the individual in
writing, and signed by all individuals
and providers responsible for its
implementation.’’
Following are the comments we
received on § 441.301(b)(1)(i)(B)(7),
which is now at § 441.301(c)(2)(vii) of
the final rule.
Comment: The few comments
received supported the proposed
language and went on to suggest specific
examples, including making use of
interpretation and translation,
customized communication supports, in
a format that is easily understood by the
individual (Braille, ASL video, diagram/
pictures, etc.), and taking enough time
for decision making.
Response: As with some other
requirements in this rule, we appreciate
the examples given, but we do not think
that CMS can list in regulation all the
possible specific methods and tools to
accomplish the desired outcome. For
clarity purposes, we have added the
term ‘‘supports’’ to this requirement.
Following are the comments we
received on § 441.301(b)(1)(i)(B)(8).
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Most of the comments we received on
this proposed requirement were more
applicable to other requirements and are
summarized under those headings. The
requirements at § 441.301(c)(1)(iii)
regarding timeliness and the
requirements at § 441.301(c)(1)(viii)
regarding a method for individuals to
request updates to the plan are
sufficient and respectful of the
individual’s timeframe as reflected in
the person-centered planning process.
Therefore, we are removing this
proposed requirement from the final
rule. We did not receive comments on
the proposed requirement at
§ 441.301(b)(1)(i)(B)(9), and adopt it in
the final rule at § 441.301(c)(2)(viii).
Following are the comments we
received on § 441.301(b)(1)(i)(B)(10),
which is now § 441.301(c)(2)(x) of the
final rule.
Comment: Many of the comments on
this proposed requirement are also
related to § 441.301(b)(1)(i)(B)(6),
regarding who must sign the plan.
Comments offered unique to the issue of
distribution include suggestions of
specific parties who should get copies of
the plan and suggestions for case
recordkeeping, including court or legal
documents. Commenters also inquired
whether distribution meant to every
entity (for example, a company
providing long term services and
supports to the individual), or also
given to every individual from that
entity (for example, every direct service
worker).
If the latter, concerns were expressed
that parts of a true person-centered plan
include very personal information, as
required in § 441.301(c)(2)(iv) above—
such as the individual’s needs,
aspirations, and even complaints—
making it inappropriate to distribute the
plan to everyone (that is, a housekeeper
does not need to know about an
individual’s relationship goals).
Response: We appreciate the
comments on this section of the rule.
The language in the final rule specifies
that the person-centered service plan
will be distributed to the individual and
other people involved in the plan. We
have also revised the language in the
final rule at the § 441.301(c)(2)(iv) to
remove the examples and added the
term ‘‘desired outcomes.’’
Following are the comments we
received on § 441.301(b)(1)(i)(B)(11),
which is now § 441.301(c)(2)(xi) of the
final rule.
Comment: Some comments discussed
‘‘self direction’’ or ‘‘participant
direction,’’ which while they sound
similar to ‘‘person-centered’’ are terms
of art for a different concept, a method
of managing long term services and
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supports in which the individual
assumes employer authority and/or
manages a budget for the services and
supports. A few comments discussed
the distinction, while a few were
confused by these concepts.
Response: Amendments to this
regulation do not specifically address
the issue of self direction. We issued
extensive sub-regulatory guidance and
technical assistance on self direction of
services, to which we refer these
commenters. We agree with commenters
who pointed out the importance of a
person-centered planning process in
implementing self direction of services,
and believe that the requirements in this
rule will facilitate self direction and
other complexities in planning long
term services and supports.
Comment: Several commenters stated
that this requirement is unclear. One
commenter thought the proposed
regulation would require self direction
for all participants.
Response: We have clarified that the
person-centered service plan covers all
aspects of services and supports,
including self direction where
applicable, by rewording the text as
follows: ‘‘Include those services, the
purpose or control of which the
individual elects to self-direct.’’
Following are the comments we
received on § 441.301(b)(1)(i)(B)(12),
which is now § 441.301(c)(2)(xii) of the
final rule.
Comment: One commenter stated that
the funding for identified supports
needs to be in place for the plan to be
implemented. Two other commenters
asked us to clarify that the full range of
services authorized by statute and
included in the state’s waiver proposal
be made available to program
participants.
Response: These observations about
providing all needed care are the logical
complement to the proposed language
about unnecessary care. Taken together
they address proper utilization of
services. We agree that states must
provide needed services to an eligible
individual enrolled in the waiver. We
believe the current language
appropriately indicates that needed
services must be provided, while
unnecessary or inappropriate services
should not; however, we have changed
the term ‘‘care’’ to ‘‘services and
supports.’’
Comment: One commenter found this
language to be ambiguous because
‘‘prevent’’ is imprecise. Services should
not be unnecessary or inappropriate.
Response: This requirement does not
imply that the waiver offers services
that are inherently inappropriate or
unnecessary. It refers to the possibility
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that particular services, or that the scope
or frequency of them, may be inherently
inappropriate or unnecessary for a given
individual, especially as the
individual’s situation changes. One of
the purposes of any service plan for
health or long term care services is to
specify the services a particular
individual requires. There is no
legitimate advantage to the individual or
to Medicaid in providing unneeded
services. However, some states or
particular programs have historically
had difficulty controlling utilization;
individuals may all be given the
maximum scope or frequency of service.
We think that with the addition noted
in the response above, the existing
language adequately conveys the
concept of appropriate utilization.
Comment: Some commenters asked
that the rule include a reference to the
‘‘most integrated setting appropriate’’
standard. Two commenters consider
this the most important aspect of the
person-centered service plan. Many
commenters of all types stated that
person-centered planning should
promote choice. However, regarding
settings there was less agreement on
what choices should be offered. Many
who were concerned about preserving
their present setting suggested they
should be allowed to choose to live
wherever they wish, and not have their
current choice removed by a
government policy.
Other commenters addressed the
process of choice. They agreed with the
planning process as proposed and stated
that setting should be addressed, in
terms of the individual’s needs and
goals. They asked that in the planning
process no types of residential provider
or housing options being offered to
section 1915(c) of the Act HCBS waiver
participants be omitted from the
discussion. They and some others also
suggested that this subject could be
raised at regular intervals when
appropriate, as the person centered
service plan is updated. Their position
was that competition among providers
of residential settings for waiver
participants is a good thing and will
promote growth of the types of settings
CMS seems to want to encourage, but
will only work if it is a fair competition
with all approved settings presented
neutrally to the individual.
Some comments about settings in
person-centered planning had more to
do with the definition of setting than
with the planning process.
Response: We agree that the setting
options in which an individual resides
should be an element in the personcentered service plan. We have included
it as a separate item under the list of
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‘‘Person-Centered Planning Process’’
requirements at § 441.301(c)(1)(ix). It
reads: ‘‘Records the alternative home
and community-based settings that were
considered by the individual.’’ We
respond to all of the setting issues, such
as landlord/tenant relationship, in our
discussion of that section of the rule. As
all the comments on this subject make
clear, the process of choosing among the
housing and service options actually
available to a particular waiver
participant is an extraordinarily multifaceted issue. A truly person-centered
planning process as required in this rule
is the best venue for facilitating this
important choice.
We also agree that part of meaningful
choice is to be presented with all
available options. A person-centered
planning process is not about promoting
certain options deemed to be more
‘‘person-centered’’ or otherwise
desirable, than other options. A personcentered process is one that puts the
individual in the center, facilitated to
make choices that may be agreeable or
disagreeable to some participating in the
process.
Therefore, we will require that the
process of informed choice be
documented. Best practices that develop
will inform future policy. A new
provision has been added at
§ 441.301(c)(2)(i) to read: ‘‘Reflect that
the setting in which the individual
resides is chosen by the individual. The
state must ensure that the setting chosen
by the individual is integrated in, and
supports full access of individuals
receiving Medicaid HCBS to the greater
community, including opportunities to
seek employment and work in
competitive integrated settings, engage
in community life, control personal
resources and receive services in the
community to the same degree of access
as individuals not receiving Medicaid
HCBS.’’
Comment: One commenter stated that
CMS should use the person-centered
plan to ensure community integration.
Response: We agree that one of the
essential purposes of the personcentered service plan is to ensure
community integration. In the
regulation at § 441.301(c)(4)(i) we have
clarified that home and communitybased settings must be integrated in, and
that individuals have full access to the
greater community.
Comment: Other commenters offered
specific additions to the proposed rule
that we considered but found to be
either too prescriptive or too detailed to
require in regulation. For example, one
commenter urged CMS to establish
benchmarks in the rule, as a
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requirement for states to receive FFP for
person-centered HCBS waivers.
Response: Many of these comments
reflect good practice in administering
services. We believe that states have
both sufficient incentive and practical
experience to be following such
practices. Where they are not, we offer
a variety of technical assistance services
to state agencies, at no charge, to assist
with these sorts of practical strategies.
We find this approach more productive
and flexible than specifying detailed
regulations for operating the program. In
addition, some of these suggestions we
have addressed in sub-regulatory
guidance such as instructions for the
section 1915(c) waiver application,
letters or bulletins to State Medicaid
directors, and other vehicles.
Comment: One commenter
recommended that CMS include
specific language in the final rule that
updates to person-centered service
plans must be completed within a
sufficient timeframe to meet the
individual’s goals.
Response: Person-centered service
plans must be reassessed at least
annually, and more frequently if the
condition of the individual changes, as
indicated in§ 441.365(e).
2. HCBS Settings § 441.301(b)(1)(iv)
(final § 441.301(c)(4))
Through the proposed rule, we
proposed to clarify and sought public
input on how to define the
characteristics of home and communitybased (HCB) settings where waiver
participants may receive services. In
new paragraph, § 441.301(b)(1)(iv), we
proposed clarifying language regarding
settings that will not be considered
home and community-based under
section 1915(c) of the Act. We clarified
that HCBS settings are integrated in the
community and may not include:
facilities located in a building that is
also a publicly or privately-operated
facility that provides inpatient
institutional treatment or custodial care;
or in a building on the grounds of, or
immediately adjacent to, a public or
private institution; or a disabilityspecific housing complex designed
expressly around an individual’s
diagnosis, that is segregated from the
larger community, as determined by the
Secretary.
We noted that this rule change does
not exclude living settings on tribal
lands that reflect cultural norms or ALS
for persons who are older regardless of
disability, when the conditions noted
above in the background section are
met.
The clarification and request for input
was partially in response to instances in
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which states or other stakeholders
expressed interest in using HCBS
waivers to serve individuals in
segregated settings or settings with a
strong institutional nature, for example,
some proposed settings on campuses of
institutional facilities, segregated from
the larger community. These settings
often do not allow individuals to choose
whether or with whom they share a
room; limit individuals’ freedom of
choice on daily living experiences such
as meals, visitors, activities; and limit
individuals’ opportunities to pursue
community activities.
CMS’ definition of HCBS setting
characteristics has evolved over the past
four years, based on experience and
learning from throughout the country
and feedback about the best way to
differentiate between institutional and
community-based care. For example, in
our April 4, 2008, proposed rule,
Medicaid Program; Home and
Community-Based State Plan Services,
(73 FR 18676), we used the number of
unrelated people living together in a
facility to define whether or not a
setting was HCB. Our April 15,
2011,proposed rule, Medicaid Program;
Home and Community-Based Services
(HCBS) Waivers, (76 FR 21432), no
longer included the number of residents
as an HCB characteristic, but did
include a detailed list of the types of
settings that do not qualify for HCBS
waivers because they are not integrated
into the community. Based on further
public comment on these proposed
regulations and on the comments we
received on the 1915(i) and 1915(k)
proposed rule, we are moving away
from defining HCB settings by what they
are not, and towards defining them by
the nature and quality of beneficiaries’
experiences. These final regulations
establish a more outcome-oriented
definition of HCB settings, rather than
one based solely on a setting’s location,
geography, or physical characteristics.
Comment: Many commenters believe
quite passionately that public funds
should only be used to support persons
in ‘‘home and community-based’’
settings—not institution-like or
congregate facilities. A commenter
wrote, ‘‘Please protect the interests of
the disabled people of the world and
stand your ground and allow HCBS
funds to be used for their intended
purposes.’’ Another commenter stated,
‘‘HCBS funds are limited and designed
to serve specific purposes, not to be
available to any and all settings which
operate under the name ‘community’.’’
Response: We agree with the general
statement that waiver funds should only
be used for their intended purpose of
supporting individuals in the
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community. HCBS must be delivered in
a setting that meets the HCB setting
requirements as set forth in this rule
(except for HCBS that is permitted to be
delivered in an institutional setting,
such as institutional respite), and since
the purpose of this authority is to
provide individuals with HCB
alternatives to institutional settings,
individuals must be living in settings
that comport with the HCB setting
requirements as set forth in this rule.
We believe the criteria set forth in the
final rule will enable CMS to
differentiate between HCBS settings and
non-HCBS settings for funding
purposes.
Comment: Several commenters shared
the sentiment that true community
integration is more than being in the
community, but rather truly
participating in that community through
working side by side with others
without disabilities in community
activities, such as jobs, clubs and other
civic activities.
Response: We agree with this
comment and believe that the changes
in the text of the final rule address
tenets of community integration. A
home and community-based setting
must be integrated in, and supports full
access of individuals receiving
Medicaid HCBS to the greater
community, including opportunities to
seek employment and work in
competitive integrated settings, engage
in community life, control personal
resources, and receive services in the
community, to the same degree of access
as individuals not receiving Medicaid
HCBS.
Comment: A number of individual
commenters shared personal stories
expressing satisfaction with their
current living arrangements and
displeasure that new regulations might
force them to move or dictate where
they should live. One person wrote,
‘‘Please allow Medicaid waivers to
continue to pay for services in planned
communities similar to retirement
communities. I want to live in a
community with my friends.’’ Another
noted, ‘‘I believe this proposed rule
would . . . deny access to residential
care and assisted living for those who
need it most.’’ Many commenters talked
about the importance of retaining
freedom of choice. One commenter
stated, ‘‘. . . what I am advocating is
CHOICE. We should be expanding
options rather than narrowing
possibilities and options, and we should
ask those with disabilities and their
families what they want, not what
others think they want.’’ Finally, quite
a few commenters echoed a warning to
stay away from a ‘‘one size fits all’’
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3011
approach in defining HCBS and to
embrace more flexibility: ‘‘The needs
and circumstances of each individual
are too diverse to warrant an outright
ban on HCBS funding for individuals
who might need specialized care.’’ They
further challenged CMS that housing
and setting options should not be
arbitrarily limited by defining HCBS
through physical and geographic
structures, but rather through the
person-centered plan, personal
outcomes and satisfaction.
Response: We very much appreciate
hearing personal stories as they help us
better understand how our proposed
actions will affect individuals receiving
services under the HCBS waiver
program. We believe that individual
choice is important and have worked to
promote choice in the final rule. In
addition, it is important to note that
HCBS waiver funding is only one way
in which federal Medicaid finances long
term services and supports; a setting
that may not meet the HCB definition
may still qualify for Medicaid financing,
but not as a home and community based
service.
We agree that the definition we
included in the proposed rule for HCBS
settings may have had the result of
restricting the settings in which HCB
waiver services can be provided in a
way that we did not intend and in
narrowing choices for participants. The
final rule is more flexible and less
prescriptive in that it does not preclude
certain settings per se but rather
establishes affirmative, outcome-based
criteria for defining whether a setting is
or is not home and community-based.
The language in the final rule specifies
that any setting that is located in a
building that is also a publicly or
privately operated facility that provides
inpatient treatment, or in a building on
the grounds of, or immediately adjacent
to, a public institution, or any other
setting that has the effect of isolating
individuals receiving Medicaid HCBS
from the broader community of
individuals not receiving Medicaid
HCBS, will be presumed to be a setting
that has the qualities of an institution
unless the Secretary determines,
through heightened scrutiny, based on
information presented by the state or
other parties, that the setting does not
have the qualities of an institution and
that the setting does have the qualities
of home and community-based settings.
Therefore, states and others have the
opportunity to refute this categorization
by providing sufficient evidence that the
individuals in the facility are, in fact,
integrated in the community in a
manner that overcomes any institutional
appearance of the setting. This means
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that we will continue to be discerning
about what types of settings qualify for
waiver funds. We are including
language in the final rule that focuses on
the critical role of person-centered
planning and addresses fundamental
protections regarding freedom, dignity,
control, daily routines, privacy and
community integration.
Comment: A number of commenters
cautioned that restricting living
situations reduces access to long term
care in the community and may force
people back into nursing facilities. They
advised that CMS not include any
specific restrictions on settings.
Response: We have made significant
changes to this section of the rule, but
still define general tenets and
characteristics of HCBS that will
preclude institutional settings from
qualifying as HCB, although they might
qualify for Medicaid financing under
other authorities. We specifically noted
that home and community-based
settings do not include: ‘‘a nursing
facility; an institution for mental
diseases, an intermediate care facility
for individuals with intellectual
disabilities; a hospital, or any other
locations that have qualities of an
institutional setting, as determined by
the Secretary.’’ Statutory requirements
specify that an individual be offered a
choice between services in an
institutional setting or in a HCBS
setting, therefore making it necessary for
us to define the difference. We
recognize that there are limited longterm care options in many communities
and may be few alternatives beyond
institutional care. However, states need
to understand what qualifies as a home
and community-based setting, and also
understand that this might trigger
change and even dislocation. To
mitigate, we have developed specific
provisions to allow for a transition
period, for existing approved HCBS
waivers under 1915(c) in accordance
with section 441.301(c)(6). We will
afford states the opportunity to propose
a transition plan that encompasses a
period up to five years after the effective
date of the regulation if the state can
support the need for such a period of
time. States are expected to demonstrate
substantial progress toward compliance
throughout any transition period. For
states that are submitting renewals early
in the first year after this final regulation
takes effect, states may submit a request
for a temporary extension to allow time
to fully develop the transition plan for
that HCBS waiver program.
Comment: A couple of commenters
expressed concern about negative
financial impact on providers.
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Response: We appreciate the concerns
regarding service providers and wish to
point out that states will have
tremendous flexibility in how they
design 1915(c) waivers, including how
they define services, provider
qualifications and service rate
methodologies in their programs. The
purpose of this regulation is to ensure
that beneficiaries in Medicaid HCBS
waivers receive services in home and
community-based settings that are true
alternatives to institutional settings and
that states and providers have a clear
understanding of how applicable
definitions will be applied by us.
Comment: One commenter thought
that privacy is already protected in
administrative rules, so it is not
necessary to address in this rule.
Response: We disagree with this
comment and have included a statement
in the final rule about qualities that
must be included in HCBS, including
the right to privacy.
Comment: A significant number of
commenters recommended that CMS
remove the entire section on HCBS
settings in the proposed rule from the
final rule.
Response: CMS has made significant
changes to this section of the rule, but
has not eliminated it. We have listened
to the many concerns expressed by
commenters regarding the description of
HCBS settings and have chosen a
different, more person-centered and
outcome-driven approach for defining
settings than what was described in the
proposed rule.
Comment: Commenters generally
liked the CMS prohibition against using
HCBS waiver funds to provide services
to individuals living in a setting in
which they are required to receive and
participate in services as a condition of
continued tenancy. Further, some
commenters wanted CMS to require
providers to promote aging in place.
They stated the need for additional
qualified services and supports should
not be justification for asking a person
to leave a setting; however, should the
person’s needs exceed what legally can
be provided in the setting, appropriate
transfer processes and protections must
be in place.
Response: There is nothing in this
rule that negates or waives compliance
with other Medicaid requirements, not
specifically waived by section 1915(c)
authority, such as an individual’s right
to obtain services from any willing and
qualified provider of a service. In the
final rule, we have revised
§ 441.301(c)(4) by replacing the
language with new requirements for
HCBS settings, and at § 441.301(c)(4)(v)
we have included the following
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requirement that the setting, ‘‘facilitates
individual choice regarding services and
supports, and who provides them.’’ This
requirement applies to all settings
including provider-owned or controlled
residential settings.
Comment: A commenter asked if
people currently living in settings that
do not meet the new criteria will have
a grandfathering period to move out or
disenroll from the waiver. Many
commenters strongly encouraged CMS
to allow sufficient time for states,
providers, and individual waiver
participants and their families to make
the transition away from historic legacy
settings that may not comport with the
proposed rule language, in order to
minimize adverse impacts on
individuals and systems of services and
supports. Some commenters suggested
that if we consider grandfathering noncompliant programs, we should not
make the grandfathered period
permanent, but should only allow
grandfathering of existing homes located
on the periphery of a campus, but not
separated by fencing or barriers.
Response: We understand that time is
required to adjust to the new
requirements set forth in the final rule.
The revised language in the final rule
includes the requirements for states to
submit transition plans for coming into
compliance for existing programs and
HCBS waivers.
Comment: One commenter
emphasized the need to involve
stakeholders in dialogue as CMS moves
forward on working with states to
implement final regulations. Another
commenter recommended that the
Department of Defense have the
opportunity to provide
recommendations that will enhance
military families’ access to the waiver as
they move from state to state.
Response: We engaged in a public
input process on the 1915(c) regulation,
which included both an Advanced
Notice of Proposed Rulemaking
(ANPRM) and the Notice of Proposed
Rulemaking (NPRM), producing well
over 2500 separate comments. We have
taken the time to thoroughly analyze
comments from a wide range of
stakeholders and incorporate
stakeholder suggestions in crafting the
final rule. We have also reviewed
comments from the proposed rules for
the 1915(i) and 1915(k) programs and
have incorporated suggestions into this
final rule so that all three HCBS
authorities are aligned. CMS is
committed to working with states and
providing technical assistance, as
needed, with implementation of the
final rule.
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Comment: Many commenters
suggested CMS clearly outline the
qualities of an institutional setting in
the regulatory text and not just in the
preamble. One commenter proposed
including a list of 12 qualities of an
institution in the regulatory text.
Response: Rather than explicitly
outlining the qualities of an institution,
we have chosen to more clearly outline
the qualities of home and communitybased settings in the regulatory text. The
final language provides a specific list of
five qualities that must be present in
order for a setting to be classified as
home and community-based, as well as
additional criteria that must be met by
provider-owned or controlled settings.
The final rule also notes that home and
community-based settings do not
include nursing facilities, institutions
for mental diseases, intermediate care
facilities for individuals with
intellectual disabilities, or hospitals.
Comment: Several commenters
wanted more detail in the rule defining
HCBS ‘‘settings.’’ One commenter
proposed that the following language be
added to the description of appropriate
HCBS ‘‘settings’’ in the rule: ‘‘support
exercising full rights and
responsibilities as community citizens’’
and ‘‘individualized services and
supports.’’ Another commenter
proposed a list of nine person-centered
attributes that it believes should be
found in all HCBS settings. The nine
attributes are: core values and
philosophy, relationships and sense of
community, governance/ownership,
leadership, workforce practices,
meaningful life and engagement,
services, environment, and
accountability. Other commenters also
provided differing views on whether
sheltered workshops, adult day care
services, and other congregate settings
and non-residential facilities solely for
persons with disabilities should be
considered HCB. Some believed that the
rule should exclude these settings from
the HCBS definition as they still have
the qualities of an institution. Others,
however, believed these settings should
qualify for waiver funding, stating that
HCBS characteristics should not apply
only to residential services.
Response: 1915(c) HCBS must be
delivered in a setting that meets the
HCB setting requirements as set forth in
this rule. In addition, since the purpose
of this authority is to provide
individuals with HCB alternatives to
institutional settings, individuals
receiving 1915(c) HCBS must be living
in settings that comport with the HCB
setting requirements as set forth in this
rule regardless of whether they are
receiving HCBS in that residence. This
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is consistent with CMS’ longstanding
policy regarding 1915(c) HCBS.
Comment: Many commenters stated
that they thought the regulation should
specify that an HCBS setting must not
be located on the grounds of, or
immediately adjacent to, a private as
well as a public institution.
Response: We appreciate the
commenters’ concerns. It is expected
that all settings, public and private,
meet the HCB setting requirements of
this regulation. These final rules
specifically make reference to a setting
that is adjacent to a public institution in
the regulation language due to public
input that stressed how such settings
inherently discourage integration with
the broader community. We will apply
heightened scrutiny to such settings
because of the likelihood that they do
not offer the characteristics of a home
and community-based setting and
hinder or discourage integration with
the broader community.
Comment: Many commenters thought
some terms in the proposed rule were
vague and/or needed further defining.
For example, many commenters wanted
the rule to include clearer definitions
for terms such as ‘‘immediately adjacent
to a public institution’’ and ‘‘housing
complex designed expressly around an
individual’s diagnosis or disability.’’ At
least one commenter stated that terms
like ‘‘meaningful access’’ and ‘‘choice’’
were too subjective to have a place in
regulation.
Response: We appreciate some
commenters’ desires for more specific
and clear definitions in the final rule,
but believe that highly specific, closeended parameters are limiting and often
prove ineffective. We are instead
moving towards evaluating outcomes
and characteristics to determine
whether or not a particular setting
produces desirable outcomes—while
attempting to be as clear and precise as
possible in describing those outcomes
and characteristics. Where appropriate,
CMS has added additional specificity to
the final rule.
Comment: Some commenters believe
that ‘‘immediately adjacent to a public
institution’’ was unnecessarily
restrictive. In contrast, another
commenter believed that use of the term
‘‘immediately adjacent’’ was not
restrictive enough, as ‘‘it could allow
HCBS housing at an institution
separated by a nature trail, parking lot
or tree line.’’ One comment included the
recommendation that we add the
phrase: ‘‘or sharing common employees
or management with a public
institution’’ after the phrase
‘‘immediately adjacent to a public
institution.’’
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Response: We believe that the process
for heightened scrutiny, as described in
the final rule, allows us to appropriately
determine whether such settings meet
the HCBS requirements. We believe this
approach will allow us to take into
account the kinds of issues the
commenters described.
Comment: Several commenters
believed CMS should strike the term
‘‘custodial care’’ from the rule. Another
commenter wanted us to clarify whether
‘‘custodial care’’ prohibits care in foster
care settings.
Response: We agree that the term
‘‘custodial care’’ is unclear and
confusing and should not be included in
the final rule. We have deleted it from
the regulatory text.
Comment: We received many
comments that certain settings—such as
group homes, adult foster care, and
assisted living facilities—should qualify
as home and community-based because
many individuals consider them to be
their homes and to be a part of the
community. On the other hand, we also
received comments from others that
these types of facilities are never
appropriate as HCBS settings.
Response: Given the variability within
and between types of housing
arrangements, CMS cannot determine
simply by the type of group housing,
whether it complies with HCBS
characteristics. As a result, particular
settings, beyond those specifically
excluded in the regulation text, will not
automatically be included or excluded,
but rather will be evaluated using the
heightened scrutiny approach described
in the regulation.
Comment: Commenters stated that the
regulation should specify that a
‘‘housing complex designed expressly
around an individual’s diagnosis or
disability’’ includes complexes that
serve individuals with different
diagnoses or disabilities, as opposed to
just individuals with a particular
diagnosis or disability. Another
commenter requested a definition of a
housing complex that is designed
expressly around an individual’s
diagnosis or disability.
Response: We appreciated these
comments, which indicated to us that
the language means different things to
different populations and programs. As
a result of the comments we received,
we have revised the rule to remove the
language, ‘‘housing complex designed
expressly around an individual’s
diagnosis or disability,’’ In the final
rule, we have removed this language.
The regulatory text now includes the
following language: ‘‘any other setting
that has the effect of isolating
individuals receiving Medicaid HCBS
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from the broader community of
individuals not receiving Medicaid
HCBS will be presumed to be a setting
that has the qualities of an institution
unless the Secretary determines through
heightened scrutiny, based on
information presented by the state or
other parties, that the setting does not
have the qualities of an institution and
that the setting does have the qualities
of home and community-based
settings.’’ We intend to issue additional
guidance to provide examples of the
types of settings that will be subject to
heightened scrutiny. The guidance will
also specify the process we will use to
determine if a setting meets the home
and community-based criteria.
Comment: Commenters disagreed
with proposed language that would
exclude ‘‘housing designed expressly
around an individual’s diagnosis or
disability’’ from the definition of an
HCBS setting. They noted that certain
disabled populations (such as those
with brain injury and spinal cord
injuries or Alzheimer’s disease) require
specialized facilities and care designed
to meet their specific needs.
Commenters stated that complexes
designed around an individual’s
diagnosis or disability serve as
alternatives to institutionalized care and
allow residents to function with greater
independence. We received a significant
number of comments from diverse
groups of individuals commenting that
there are good reasons to live in
residential settings specific to
individuals’ needs.
Response: As noted above, the final
rule no longer includes the term
‘‘housing designed expressly around an
individual’s diagnosis or disability.’’
The new regulatory language is restated
above. We agree that certain kinds of
specialized settings may prove highly
beneficial to particular populations and
may be well integrated into the
community. These factors will be taken
into account when deciding whether or
not a setting should qualify for HCBS
waiver funding.
Comment: Some commenters asked
CMS to look into HCBS settings’
implications for intersection with HUD
811 and 202 projects and whether this
will result in people losing housing.
They encouraged CMS to look at
potential conflicts with Fair Housing
rules and work collaboratively with
HUD and the Department of Agriculture
so that we better coordinate available
federally subsidized housing options
with delivery of waiver services. One
commenter who believed that HUDfunded independent housing should
qualify stated, ‘‘We would urge the
Secretary to use her discretion to
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recognize that even those Section 811
housing developments that are designed
‘expressly around an individual’s
diagnosis or disability’ are often the
most community-based and inclusive
housing model available, and it would
be illogical to deny HCBS waiver funds
to support services to an individual
living in such a setting.’’
Response: We have worked closely
with HUD and other federal agencies on
the impact of this regulation on
federally supported housing options.
We believe the changes to the final rule
allow for the appropriate designation of
HCBS settings and for sufficient
transition time for states to comply.
Comment: One commenter suggested
that a ‘‘home’’ should not be considered
‘‘in the community’’ if more than four
unrelated people live in the home.
Response: In the 2008 1915(i) Notice
of Proposed Rulemaking, we did
propose defining institutional care
based on the number of residents living
in the facility. However, we were
persuaded by public comments that this
was not a useful or appropriate way to
differentiate between institutional and
home and community-based care. As a
result, we have now determined not to
include or exclude specific kinds of
facilities from qualifying as HCBS
settings based on the number of
residents in that facility. We have,
however, established a list of specific
conditions that must be met in providerowned or controlled residential settings
in order to qualify as HCBS.
Comment: A commenter thought CMS
should not allow clusters of homes in
gated communities to qualify as an
HCBS setting. Others objected to
classifying facilities on campus settings
or farms as HCBS. On the other hand,
many people supported categorizing
these facilities as HCBS, noting that
cluster or campus living may promote
health and welfare in emergencies
because of physical proximity. Many
commenters expressed concern that the
proposed rule would exclude rural
farmsteads and farm communities for
individuals with autism from receiving
waiver funds. These commenters noted
that rural, agricultural settings are
desirable for people with autism, as they
provide safe, calm environments—
whereas urban settings can prove
dangerous and disorienting.
Response: The Secretary will
determine through heightened scrutiny,
based on information presented by the
state or other parties, whether such
complexes do or do not have the
qualities of an institution and whether
these complexes have or do not have the
qualities of home and community-based
settings. We will evaluate both rural and
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urban settings based on whether they
have the characteristics required under
the regulation.
Comment: Several commenters
suggested that CMS needed to be careful
of the unintended consequences of the
prescriptive language about settings in
the proposed rule that would force
people to move from their long term
homes in the community and lose
services. Some commenters stated that
CMS must also be open to unique
situations and different types of living
situations that may be designed for
people in rural areas.
Response: We have considered the
many concerns expressed by
commenters regarding the description of
HCBS settings in the proposed rule.
Through the final rule we have chosen
a different, more person-centered,
outcomes-based approach than what
was described in the proposed rule in
part to address concerns about
unintended consequences of specific
language that was used in the proposed
rule about settings.
Comment: There were several themes
that emerged amongst the many
commenters who agreed with the
proposed language in the rule regarding
home and community-based settings.
Some commended CMS for taking a
stand on what comprises home and
community qualities. Others
appreciated that we were using
characteristics that will help people
truly be included in their communities
and not just focusing on size or location
of settings. Other commenters
specifically mentioned that institutions
and other congregate settings should not
be a part of a waiver and should not be
allowed to call themselves HCBS.
Commenters agreed that use of person
centered planning, flexibility regarding
meals and availability of food, control
over daily activities, free access to
visitors and privacy are all hallmarks of
community living. Individual
commenters and the general public
focused on the importance of using
waiver funding for people with
disabilities to live in the community
like everyone else and not be shut away
from other people.
Response: We concur with much of
the content from these commenters.
Through the final rule we have chosen
to take a somewhat different approach
from what was described in the
proposed rule in order to address the
different commenters with divergent
views on this issue. Specifically, we
have chosen to be somewhat less
prescriptive regarding physical and
geographical characteristics of settings
and to focus instead on the critical role
of person-centered service planning
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and on characteristics that are
associated with independence, control,
daily routines, privacy and community
integration. Further, with respect to
certain types of settings, the final rule
specifies that the Secretary will
determine through heightened scrutiny,
based on information presented by the
state or other parties, that the setting
does not have the qualities of an
institution and that the setting does
have the qualities of home and
community-based settings.
Comment: One commenter suggested
that the proposed language runs counter
to consumer choice, would restrict
important specialized programming,
and is counter to the entire course and
direction of the waiver program
recommending that CMS delete the
proposed section in its entirety and
begin anew by convening stakeholders
to discuss this critical definition. The
commenter added that these conditions
are a first attempt to regulate federally
the assisted living environment which
could and should remain at the state
level.
Response: This rule applies to all
settings where individuals are receiving
HCBS and does not single out assisted
living environments. It is intended to
assure, consistent with the statute, that
Medicaid financing provided through
HCBS waivers is available to
participants who are receiving services
in settings that are true alternatives to
institutional care.
3. Target Groups § 441.301(b)(6)
Under section 1915(c) of the Act, the
Secretary is authorized to waive section
1902(a)(10)(B) of the Act, allowing states
not to apply requirements that the
medical assistance available to
categorically-eligible Medicaid
individuals must not be less in amount,
duration or scope than the medical
assistance made available to any other
such individual, or the medical
assistance available to medically needy
individuals. We have interpreted this
authority to permit States to target an
HCBS waiver program to a specified
group of individuals who would
otherwise require institutional care. A
single section 1915(c) waiver may,
under current regulation, serve one of
the three target groups identified in
§ 441.301(b)(6). As provided in the rule,
these target groups are: ‘‘Aged or
disabled, or both; Individuals with
intellectual or developmental
disabilities, or both; and Mentally ill.’’
States must currently develop separate
section 1915(c) waivers in order to serve
more than one of the specified target
groups. A federal regulatory change that
permits combining targeted groups
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within one waiver will remove a barrier
for states that wish to design a waiver
that meets the needs of more than one
target population.
This regulatory change will enable
states to design programs to meet the
needs of Medicaid-eligible individuals
and potentially achieve administrative
efficiencies. For example, a growing
number of Medicaid-eligible individuals
with intellectual disabilities reside with
aging caregivers who are also eligible for
Medicaid. The proposed change will
enable the state to design a coordinated
section 1915(c) waiver structure that
meets the needs of the entire family
that, in this example, includes both an
aging parent and a person with
intellectual disabilities. In this
illustration, the family currently would
be served in two different waivers, but
with the proposed change, both could
now be served under the same waiver
program.
The revisions to § 441.301(b)(6) will
allow states, but not require them, to
combine target groups. Under this rule,
states must still determine that without
the waiver, participants will require
institutional level of care, in accordance
with section 1915(c) of the Act. The
regulation will not affect the cost
neutrality requirement for section
1915(c) waivers, which requires the
state to assure that the average per
capita expenditure under the waiver for
each waiver year not exceed 100 percent
of the average per capita expenditures
that will have been made during the
same year for the level of care provided
in a hospital, nursing facility, or ICF/IID
under the state plan had the waiver not
been granted. We will provide states
with guidance on how to demonstrate
cost neutrality for a waiver serving
multiple target groups.
The comments provided on this
provision were largely positive, advising
CMS to carefully consider quality
elements and protections needed to
ensure that all target groups are
protected sufficiently in such a
structure. Through this final rule, we
include the requirements that each
individual within the waiver, regardless
of target group, has equal access to the
services necessary to meet their unique
needs.
Comment: A theme expressed by the
majority of commenters who disagreed
with this provision in the rule centered
around potential negative impact on
consumers. These included using the
combining of target groups to limit
service packages, serve less people
overall, limit choices and create
infighting among different disability
groups. Several commenters were
concerned that states would make
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decisions based on service/cost, which
may lead to less adequate services for
people with disabilities.
Response: Challenges regarding
limited resources at the state level
already exist and will continue to exist
whether or not a state chooses to pursue
combining target populations in one
waiver. This change to the regulation is
not intended to have any impact on
payment rates for services. To ensure
transparency and input, we strongly
encourage states interested in this
option to consult with affected
stakeholders in advance of
implementation.
Comment: Several commenters
expressed concern that combining of
target groups will lead to frustration for
states and cause barriers to timely
innovations.
Response: The intention in the rule is
to provide options to states that foster
creativity and better integration of
services across populations, which may
lead to administrative efficiencies in
state Medicaid agencies. The intent is
not to prevent or inhibit innovation and
the decision to combine target groups is
optional for the state.
Comment: A few commenters noted
that people with various disabilities, for
example people with developmental
disabilities, people with mental illness
and frail elders, have different needs
from each other and should not be
residing together in housing situations.
Further, they described how this can
lead to dangerous situations that may
threaten the well-being of more
vulnerable individuals, such as frail
elders when they reside with younger
people with disabilities, particularly if
there is any potential that such
disabilities would make a person more
likely to engage in any dangerous or
aggressive behavior.
Response: The changes to this section
of the regulation do not speak to
combining different target groups in the
same living situations, but rather to the
inclusion of multiple target groups in
the overall waiver design and operation.
Including multiple target groups in one
waiver will not alleviate responsibilities
of states for ensuring the health and
welfare of all participants and detailing
their quality improvement strategies for
that waiver. The final rule at
§ 441.302(a)(4) specifies that, if a state
chooses the option to serve more than
one target group under a single waiver,
the state must assure that it is able to
meet the unique service needs that each
individual may have regardless of the
target group.
Comment: A commenter
recommended that if states are
permitted to combine target populations
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in a single waiver, CMS must expressly
require a right of beneficiary choice.
Response: Including multiple target
populations in one waiver does not
change freedom of choice requirements
that exist in Medicaid generally and in
1915(c) waivers specifically. Regardless
of whether a state includes multiple
target populations, all included services
must be made available to those
enrolled in the waiver who demonstrate
a need for the services (as indicated in
the person-centered assessment and
service plan).
Comment: A number of commenters
who disagreed with this provision
responded to perceived changes that
were not contemplated in the proposed
rule. One commenter thought this rule
would cause cost-neutrality issues
between populations. Interestingly,
some commenters thought the proposed
rule would mandate states to combine
target populations and believed it
should be a state choice.
Response: The concern that cost
neutrality would become problematic in
waivers with combined target groups
should not be a factor, as cost neutrality
is calculated based on the relevant level
of care group in the waiver, not by target
population. For example, people with
physical disabilities who meet nursing
facility level of care would need to meet
that cost neutrality level and people
with intellectual disabilities would still
need to meet the cost neutrality for ICF/
IID level of care. In fact, multiple levels
of care are an option currently in
waivers where a particular target
population may include multiple levels
of care within the same waiver. As this
choice is optional, the state will have
the opportunity to submit two separate
waivers if cost neutrality was not
initially met with one waiver. Neither
the proposed rule nor the final rule
mandates states to combine target
populations, but rather provides this
option for states.
Comment: Several commenters were
concerned that people who are currently
receiving waiver services would lose
their services if the state combined
population specific waivers into one
waiver that included multiple target
groups. They suggested that CMS
require appropriate safeguards to protect
current participants.
Response: In an effort to ensure that
safeguards are in place to protect the
health and welfare of each waiver
participant, the requirement in the final
rule at § 441.302(a)(4) specifies that
states must assure us that they are able
to meet the unique service needs that
particular target groups may present
when the state elects to serve more than
one target group under a single waiver.
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In the Instructions and Technical Guide
for section 1915(c) HCBS waiver
applications, we currently require a
transition plan for waiver participants
who may be adversely affected when a
change through amendment, renewal
consolidation, or the termination of a
waiver occurs.
Comment: Several commenters asked
for clearer expectations around quality
measurement and related
documentation.
Response: Combining waiver target
groups will not alleviate responsibilities
of states for ensuring the health and
welfare of all participants and detailing
their quality improvement strategies for
that waiver. Further guidance on waiver
quality improvement strategies is
addressed in the Instructions and
Technical Guide for section 1915(c)
HCBS waiver applications. We believe
there may be potential for efficiencies
by having a uniform quality system in
one waiver that serves multiple target
populations.
Comment: Several commenters would
like to see CMS allow states to define
different services packages for
subgroups within combined waivers.
Other commenters asked CMS to clarify
that equal access does not mean that
each individual receives the same type,
amount, duration or scope of service. In
addition, one commenter recommended
that waivers serving multiple target
groups should not be required to cover
the array of services specifically needed
by each of the covered groups as well as
generic services that will benefit all.
Another commenter suggested that CMS
require a common service menu for all
target populations.
Response: States may continue to
design and keep 1915(c) waivers by
individual target group and not choose
to combine target groups. If they
combine target groups in one waiver,
equal access means that all included
services must be made available to those
who need them (as indicated in the
person-centered assessment and service
plan). This does not mean that
individuals with differing needs would
receive the same array, amount,
duration or scope of services. Nothing in
the proposed or final rule changes state
flexibility in choosing services to meet
the needs of people in waivers.
Comment: Several commenters raised
the issue of waiting lists and the
potential to crowd out one population
group due to pent up demand with long
wait lists for another group; this was
specifically mentioned in relation to
older adults not having timely access to
services.
Response: One of the options
available to states to ensure the
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continuation of services to incoming
multiple target groups under one waiver
is to reserve capacity. Reserving
capacity is only a means to hold waiver
openings for the entrance of specific sets
of individuals to the waiver. Capacity
cannot be reserved to limit access to a
specific waiver service. All individuals
who enter the waiver must have
comparable access to the services
offered under the waiver. For example,
capacity may not be reserved to limit
the number of waiver participants who
may direct some or all of their waiver
services.
Comment: Several commenters
pointed out that due to Medicaid’s
historic institutional bias, home and
community-based services are still
generally under-resourced relative to
facility-based care. One commenter
suggested that CMS not allow states to
use newly combined waivers to cut back
on HCBS services overall, as such a
move would be inconsistent with a
state’s obligations under Olmstead.
Response: We intend to offer more
opportunities to states to facilitate their
participation in HCBS options, not to
reduce states’ participation in 1915(c)
waivers or limit HCBS services. Further,
this regulation change does not alleviate
states’ independent obligations under
the Americans with Disabilities Act or
the Supreme Court’s Olmstead decision.
Comment: One commenter
recommended that states be allowed the
flexibility to create waivers that include
hybrid care arrangements that have
some institutional components.
Response: Since the waivers are
statutorily designed for the purpose of
providing HCBS as an alternative to
institutional care, we disagree with this
comment.
Comment: Several commenters agreed
with this section of the rule but
recommended that cost neutrality
calculations be based either on
combined calculations or on the target
group with the higher estimated cost—
not calculated separately for each
population group. It was also
recommended that we provide more
detail on cost neutrality calculations in
the regulation text, including whether
states would have the option to combine
populations with different institutional
levels of need into one waiver. Several
other commenters thought that states
should be able to limit the number of
waiver participants in each target group
to maintain fiscal neutrality.
Response: Combining target groups
allows states to combine people with
different levels of care, for example,
people with ICF/IID level of care and NF
level of care, in the same waiver. Cost
neutrality is calculated by level of care,
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not target group. The Instructions and
Technical Guide for section 1915(c)
HCBS waivers provide guidance on
calculating cost neutrality with multiple
levels of care in one waiver. The current
waiver application already prompts the
user to enter costs for each level of care
and then aggregates them for one
combined cost neutrality test. States can
choose to combine multiple target
groups in a single waiver or continue to
use separate waivers for each target
group.
Comment: Several commenters shared
concerns about cost limits negatively
impacting particular populations by
either being set too low or too high.
CMS was also asked to calculate and
monitor the baseline combined funding
for individual populations.
Response: We do not believe that this
change to regulation will have any
impact on a state’s choice to select or
not select individual cost limits. We
currently require states to report on
funding for waiver services to ensure
cost neutrality by waiver. At
§ 441.302(a)(4)(i), we have also included
a requirement for states to report
annually in the quality section of the
CMS–372, data that indicates the state
continues to serve multiple target
groups in a single waiver and that a
single target group is not being
prioritized to the detriment of other
groups.
Comment: A few commenters
recommended that CMS require states to
apply savings from newly combined
waivers proportionately and equitably
to target groups affected for the purpose
of addressing waiting lists and
expansion of access to waiver services.
Response: This comment goes beyond
the statutory scope of what we can
require in the context of section 1915(c)
waivers.
Comment: A commenter asked CMS
to clarify which state agency(s) will be
authorized to implement the waiver (for
example, state agency on aging or state
agency dealing with ID/DD issues) when
a state chooses to submit a combined
waiver.
Response: In accordance with
§ 431.10, the Medicaid Agency is
responsible for ensuring that a waiver is
operated in accordance with applicable
federal regulations and the provisions of
the waiver itself. However, it may
delegate operational activities and
functions to another state agency
(operating agency) to perform under the
supervision and oversight of the State
Medicaid Agency. Decisions around the
design of waiver administrative
structures rest with the state, subject to
CMS requirements that the Medicaid
Agency retains ultimate authority and
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responsibility for the operation of the
waiver. Greater detail on waiver
administrative structures is provided in
the Instructions and Technical Guide for
section 1915(c) waivers.
Comment: Several commenters
indicated that CMS should employ the
lessons learned through the Aging and
Disability Resource Center (ADRC)
model.
Response: We agree that allowing
states, at their discretion, to combine
target groups in one waiver is consistent
with one of the principles of the ADRC
model to allow a cross disability
population approach, as appropriate.
Further, and as some other commenters
noted, it is critical that if states choose
to combine target populations in one
waiver, they must assure CMS that they
are able to meet the unique service
needs that each individual may have
regardless of target group, and that each
individual in the waiver has equal
access to all needed services.
Comment: Several commenters raised
clarifying questions about combining of
target groups. One commenter asked
how waitlists would be handled—by
population group, services or in some
other manner. Several other commenters
requested further clarification around
wait lists.
Response: Through current guidance
in the Instructions and Technical Guide
for section 1915(c) waivers, CMS allows
states to prioritize selection of entrants
into a waiver, so a state has the
flexibility to structure prioritization for
waiver entry. However, once a person
has entered the waiver all included
services must be made available to those
who need them (as indicated in the
person-centered assessment and service
plan).
Comment: One commenter asked
CMS to clarify what ‘‘equal access’’
means. ‘‘Can there be different sets of
services within a combined waiver
targeted to specific groups?’’
Response: Equal access means that
once individuals have enrolled in the
waiver all services in the waiver must
be made available to them, if needed (as
indicated in the person-centered
assessment and service plan).
Comment: Commenters raised several
concerns related to case management.
One commenter stated that the case
management entity should not be able to
also be the agency that is administering
the self-directed hours as the payroll
agent. Another commenter expressed
concern about combining disability
populations in terms of quality of case
management provided, the number of
people for whom states can provide case
management and how states can
differentiate populations and services.
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Response: We continue to appreciate
the critical role of case management in
the lives of waiver participants. How
states set up their case management
system for a waiver with combined
target groups will be an important
consideration. Through appropriate
provider qualifications, we believe that
states will be able to ensure that waiver
case management services meet the
needs of populations served.
Comment: There were several themes
amongst the many commenters who
agreed with the proposed language in
the rule. These themes included
supporting flexibility to allow a familybased approach to service design and
delivery, improving access, reducing
inequities and fragmentation between
disability groups and improving
administrative efficiencies at both the
provider and state levels. Several
commenters spoke favorably about how
combining target groups would allow
both an aging parent and a person with
intellectual disabilities to be served in
the same waiver. Other commenters
commended CMS for breaking down
‘‘silos’’ between populations of people
with different disabilities by allowing
states to combine target groups in
waivers. A few commenters expressed
particular support related to the rule
change’s potential impact on expanding
opportunities for people with mental
illness to be served in waivers, as they
have historically been underserved in
section 1915(c) of the Act waivers.
Response: We appreciate these
comments and are retaining the
proposed language in this section of the
rule.
4. State Assurances (§ 441.302)
In an effort to ensure that safeguards
are in place to protect the health and
welfare of each waiver participant, we
proposed in a new paragraph
§ 441.302(a)(4) that to choose the option
of more than one target group under a
single waiver, states must assure CMS
that they are able to meet the unique
service needs that each individual may
have regardless of target group, and that
each individual in the waiver has equal
access to all needed services.
Comment: Many commenters who
agreed with the proposed changes in
targeting stated that a comprehensive
service array that ‘‘meets the unique
service needs’’ of each individual in
each target group is critical and that
regulation language needs to be
strengthened. Additionally, they believe
that the provider expertise for specialty
populations needs to be maintained.
Multiple commenters singled out people
with ID/DD in this vein as being at risk
without appropriate safeguards to tailor
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service packages and provider
qualifications to meet their needs.
Response: We agree with this
comment and strengthened the language
included in § 441.302(a)(4) that directs
states to ensure that the unique service
needs are met. For participants enrolled
in the same waiver, states cannot restrict
services to certain target groups or
choose to provide some services only to
people with particular diagnoses. The
language in the final rule at
§ 441.302(a)(4) will now read,
‘‘Assurance that the state is able to meet
the unique service needs of the
individuals when the state elects to
serve more than one target group under
a single waiver, as specified in
§ 441.301(b)(6).’’
Comment: One commenter noted that
‘‘selects to serve’’ should be changed to
‘‘elects to serve’’ in regard to state
choice about combining target
populations in proposed § 441.302(a)(4).
Response: We agree and will change
the regulation text to read ‘‘elects to
serve’’ instead of ‘‘selects to serve’’ at
§ 441.302(a)(4).
In addition, to ensure that services are
provided in settings that are home and
community-based, we proposed in a
new paragraph § 441.302(a)(5) that
states provide assurance that the
settings where services are provided are
home and community based, and
comport with new paragraph
§ 441.301(c)(4). While we are not
changing the existing quality assurances
through this rule, we clarified that states
must continue to assure health and
welfare of all participants when target
groups are combined under one waiver,
and assure that they have the
mechanisms in place to demonstrate
compliance with that assurance.
We received no comments on
§ 441.302(a)(5) and we will adopt the
proposed language.
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5. Duration, Extension, and Amendment
of a Waiver (§ 441.304)
At § 441.304, we made minor
revisions to the heading to indicate the
rules addressed under this section. We
revised § 441.304(d) and redesignated
current § 441.304(d) as new
§ 441.304(g).
a. Waiver Amendments With
Substantive Changes (§ 441.304(d))
The new § 441.304(d) will codify and
clarify our guidance (Application for a
section 1915(c) Home and CommunityBased Waiver, V. 3.5, Instructions,
Technical Guide and Review Criteria,
January 2008) regarding the effective
dates of waiver amendments with
substantive changes, as determined by
CMS. Substantive changes include, but
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are not limited to changes in eligible
populations, constriction of service
amount, duration, or scope, or other
modifications as determined by the
Secretary. We added regulatory
language reflective of our guidance that
waiver amendments with changes that
we determine to be substantive may
only take effect on or after the date
when the amendment is approved by
CMS, and must be accompanied by
information on how the state has
assured smooth transitions and minimal
adverse impact on individuals impacted
by the change.
CMS received 43 comments regarding
§ 441.304(d), which will clarify and
codify existing technical guidance
governing the effective dates of waiver
amendments that make substantive
changes.
Comment: Several commenters
expressed concern that this requirement
could be problematic if a state is
directed by its legislature to make a
change to a waiver program prior to
CMS approval of an amendment
implementing that change. CMS should
consider this possibility as it finalizes
this rule. There is no allowance for
emergency situations or changes that
might benefit clients or providers in the
broad definition of ‘‘substantive.’’
Response: The intention in the rule is
to codify our current practice regarding
what types of amendments must be
implemented prospectively.
Comment: A commenter thought that
retroactive approvals of waiver
amendments should never be allowed.
Response: We believe there are
situations when a retroactive approval is
permissible. For example, codifying the
continuation of the current practice for
states of being able to increase the
number of waiver participants served
retroactively allows states to serve more
people, while continuing to plan and
manage waiver growth within their
budgets.
Comment: A number of commenters
wanted CMS to further clarify what
constitutes a substantive change;
however, the commenters varied in
what they believe a substantive change
should include. Several suggested that
only changes to eligibility standards,
procedures, or methodologies should be
considered substantive; others
recommended that elimination or
reduction in services, and changes in
the scope, amount and duration of
services, as well as changes in provider
rates, would always constitute
‘‘substantive changes.’’
Response: Given the range of
comments on what a list of substantive
changes should include, we believe it
prudent to maintain most of the
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language in the proposed rule around
the types of examples of substantive
changes, while leaving flexibility to the
Secretary to determine other types of
proposed changes that may also be
considered substantive. We have,
however, changed the phrase ‘‘change in
the eligible population’’ to ‘‘constriction
in the eligible population’’ in the final
rule to be more specific about the kind
of change that would constitute a
‘‘substantive change.’’ We have also
rewritten the phrase ‘‘changes in the
scope, amount, and durations of the
services’’ to read ‘‘reduction in the
scope, amount, or duration of any
service’’ to further clarify what
constitutes a substantive change. We
also believe that a listing of only
changes to eligibility standards,
procedures, or methodologies is too
broad regarding what constitutes a
substantive amendment. We do,
however, make clear that a state must
submit amendments for prospective
review and approval by CMS that may
have a potentially negative impact on
waiver participants, as well as that the
amendment must be accompanied by
information on how the state has
assured smooth transitions and minimal
adverse impact on individuals affected
by the change.
Comment: Several commenters
wanted CMS to be more precise with
language in this section of the rule. One
asked that the list of examples of
substantive items not be defined as
exhaustive and several other
commenters thought the use of ‘‘may
include’’ in regard to substantive
changes, was too permissive. Another
commenter recommended that CMS
state that the elimination or reduction in
services and changes in the scope,
amount, and duration of services will
always constitute ‘‘substantive
changes.’’
Response: We agree that the term
‘‘may include’’ is not sufficiently
precise to be helpful. We have deleted
the word ‘‘may’’ from § 441.304(d)(1)
and have rewritten this section of the
rule as follows: ‘‘Substantive changes
include, but are not limited to, revisions
to services available under the waiver
including elimination or reduction of
services, or reduction in the scope,
amount, and duration of any service, a
change in the qualifications of service
providers, changes in rate methodology
or a constriction in the eligible
population.’’ We believe the current
language noting that the list of
substantive examples is not limited to
just the changes listed is sufficiently
clear.
Comment: A few commenters wanted
CMS to allow states to gain retroactive
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approval to the date of the submission
of the amendment, as opposed to the
date CMS approved the amendment.
The commenters noted that using the
date of CMS approval can present
significant challenges to a state when it
is under legislative mandate to make a
change or implement a budget initiative.
Response: While we are sympathetic
to the budgetary challenges faced by
states, we believe it would not be in the
best interest of waiver participants to
allow approval retroactive to the date of
substantive amendment submissions.
The rule reflects and maintains our
current waiver amendment review
procedures.
Comment: Commenters agreed with
several aspects of the proposed language
in the rule regarding substantive
changes to amendments. Some liked
that CMS is not allowing substantive
changes in an already existing waiver to
take effect until the waiver has been
approved by CMS, as this will help
ensure that waivers fulfill the mandate
of the HCBS waiver program. A
commenter agreed with CMS’s
definition of substantive changes.
Another commenter noted that he liked
that a state will need to demonstrate
how it will ensure smooth transition
and minimal disruption to service or
adverse impact of a change on
beneficiaries.
Response: We concur with these
comments. We agree that the rule is
being changed to achieve the purposes
outlined by these commenters.
b. Public Notice and Input (§ 441.304(e)
and (f))
Given the important requirement at
§ 447.205, which describes states’
responsibilities to provide public notice
when states propose significant changes
to their methods and standards for
setting payment rates for services, we
added a new paragraph § 441.304(e) to
remind states of their obligations under
§ 447.205. We further included a new
paragraph § 441.304(f) directing that
states establish public input processes
specifically for HCBS changes. These
processes, commensurate with the
change, could include formalized
information dissemination approaches,
conducting focus groups with affected
parties, and establishing a standing
advisory group to assist in waiver policy
development. These processes must be
identified expressly within the waiver
document and used for waiver policy
development. The input process must
be accessible to the public (including
individuals with disabilities) and states
must make significant efforts to ensure
that those who want to participate in the
process are able to do so. These
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processes must include consultation
with federally-recognized Indian Tribes
in accordance with federal requirements
and the state must seek advice from
Indian health programs or Urban Indian
Organizations prior to submission of a
waiver request, renewal, amendment or
action that would have a direct effect on
Indians or Indian health providers or
Urban Indian Organizations in
accordance with section 5006(e) of the
American Recovery and Reinvestment
Act of 2009 (Pub. L. 111–5, enacted on
February 17, 2009).
We received 102 comments regarding
§ 441.304(e) and (f), which would clarify
the public input and notice
requirements for all section 1915(c)
waiver actions.
Comment: One commenter thought
the description of a public input process
for any changes in services or operations
of a waiver was too broad.
Response: The intent in the rule is to
strengthen our current practice of
encouraging states to engage in a public
input process in order to ensure such
input without being overly prescriptive
to states in how that process is
implemented. The language in the rule
gives states examples for soliciting such
public input, while not limiting
additional methods that may work
better in particular states and/or for
particular waivers.
Comment: Several commenters asked
CMS to provide more specific
requirements around process, time
frames and methods used for public
input. One suggested adding a provision
that states must provide public notice of
waiver amendments and provide
information, training, and technical
assistance to stakeholders, including
individuals enrolled in the waiver and
their families, when waiver
amendments include substantive
changes. Another suggested that we
require specific activities that would
ensure real input, participation and
transparency; such as minimum times
for posting notice of changes (30 days),
listing of specific mechanisms or venues
for posting, a listserv, mandatory
stakeholder meetings, posting on CMS
Web sites of all active and pending
waivers, submission of all public
comments and state actions to address
those comments. Other commenters
suggested more generally that CMS
establish some threshold for minimum
public input process elements in the
regulation. Another approach
recommended was for CMS to provide
a standard against which a state will be
measured to demonstrate that a public
input process is ‘‘sufficient.’’
Response: While we appreciate the
suggestions of the commenters to
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strengthen the public notice and input
requirements in the regulation, we
believe that the level of detail suggested
in some of the comments is not
appropriate for regulation; additionally,
some of these suggestions may be
addressed in future guidance. However,
we do agree with the comment
suggesting implementing a minimum
amount of time for posting notice of
changes. In the final rule, we have
included language stating that we will
require that the State provide the public
a period of no less than 30 days in
which to provide input on a rule change
prior to implementation of that change
or submission of the proposed change to
CMS, whichever comes first.
Comment: One commenter was
concerned that extensive public input
periods could prove challenging.
Response: We believe that the time
period specified is not extensive, but
rather appropriate to allow for
meaningful public input based on the
breadth of the changes.
Comment: A commenter expressed
concerns that since states are already
required to develop a process for tribal
consultation that meets ARRA
requirements, requiring the state to
consult with all the tribes would require
a different process for waiver changes.
Response: We do not believe that the
guidance in the rule is in conflict with
provisions in 5006(e) of the American
Recovery and Reinvestment Act of 2009
(ARRA), which required solicitation of
advice from Indian health programs and
urban Indian organizations.
Comment: A number of commenters
thought CMS should provide further
clarification on what types of actions are
considered substantive and would be
subject to a public input process;
however, there were differing opinions
as to what level of change required
public input. Several commenters
thought it should include changes in
policies such as qualifications of service
providers, eligibility requirements, and
changes to services covered in the
waiver. Others thought that any changes
in services or operations of the waiver
would require public notice and input.
Response: Consistent with our
response to comments regarding waiver
amendments with substantive changes,
we believe that it would be difficult to
come up with an exhaustive list of
specific items that would be considered
substantive beyond the general
categories we listed in the proposed
rule. Further, what may be a substantive
change for one waiver may be less
significant in a different waiver or in a
different state depending on the waiver
design and the service package.
Therefore, we believe that the regulation
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is currently worded to invite public
input when it is appropriate; adding
further detail in the regulation would
not be beneficial.
Comment: A number of commenters
made recommendations about
accessibility standards to ensure that the
broadest range of stakeholder input is
obtained. Most specifically, commenters
wanted to assure that people with
disabilities, including people with
vision and hearing impairments; other
cognitive, mental, or physical
disabilities; and people with limited
English proficiency were included in
the process in a meaningful way. One of
the suggestions was to make sure they
were included on standard advisory
groups. Again, the suggested methods to
accomplish this level of accessibility
varied greatly. A commenter asked that
CMS include language from the
preamble in regulatory text that requires
accessibility for public input. Others
asked that CMS detail how individuals
or organizations can submit oral or
written input. While there were a few
comments that service providers should
be required to be part of an input
process, we received more comments
about making sure that people with
disabilities have access to an input
process.
Response: By requiring states to detail
the processes they used to solicit input
from the public in the waiver
application, we will have an appropriate
oversight mechanism to review the
integrity of a specific waiver and
specific state processes. We also have a
mechanism, as noted in the proposed
rule at § 441.304(f)(1), to specifically
look at how the process included and
was made accessible to people with
disabilities. This requirement specifies
that, ‘‘this process must be described
fully in the state’s waiver application
and be sufficient in light of the scope of
the changes proposed, to ensure
meaningful opportunities for input for
individuals served, or eligible to be
served, in the waiver.’’
Comment: A theme from several
commenters was that CMS should
establish specific guidelines and
accountability mechanisms for states
around public notice. Some of the types
of suggestions we received included
requests for CMS to: add a requirement
that the agency reply to public
comments received; file the public
comments and agency replies with
CMS; include language to require
written legal decisions for compliance
with Open Meetings Act/Sunshine
Laws; add an accountability measure to
use a public input process for a state
agency; and monitor compliance
through subsequent audits that would
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include interviews with people with
disabilities and other stakeholders to
determine the level of public input and
decision making.
Response: By requiring states to
describe in the waiver application the
processes they used to solicit input from
the public, we will have an appropriate
oversight mechanism to review the
integrity of the process, while allowing
states flexibility to implement public
input processes that make sense for the
specific waiver and the state or are
required under state law. We will
consider whether further guidance along
these lines would be helpful.
Comment: A commenter wanted CMS
to clarify that the public input process
should apply to new waivers and not
just existing waivers.
Response: We concur with this
comment and clarified in the rule that
the public input process should be for
both existing waivers that have
substantive changes proposed, either
through the renewal or the amendment
process, and new waivers. We also
clarified that the public input process
must be fully described in a state’s
waiver application.
Comment: Several other comments
received went beyond the scope of the
regulation, such as asking for more
transparency in negotiations between
CMS and states regarding review of
waiver actions. Another asked for an
assurance that input gathered from the
public should influence change.
Response: The scope of the regulation
was not intended to address our review
process and review criteria, which is
addressed further in the Instructions
and Technical Guide for section 1915(c)
HCBS waivers. We believe that the
regulation changes strengthen
requirements for states to solicit
meaningful public input prior to waiver
submissions to CMS, which will help
states in making decisions about the
design and operation of their waiver
programs that benefit the populations to
be served.
Comment: Commenters noted CMS
was not clear on whether there were any
differences between public input
regarding rate changes and notice for
operations and service changes, as these
two areas were described separately in
the proposed rule.
Response: Since there are already
existing regulations that address notice
requirements to methods and standards
of setting payment rates across Medicaid
authorities, we are reminding states of
those obligations with the rule. In
addition, in this rule we are adding new
provisions regarding public notice for
HCBS changes that are similar to those
for setting payment rates.
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Comment: There were several themes
among the many commenters who
agreed with the proposed language in
the rule regarding public notice and
input. Commenters supported the
requirement that state agencies must
provide public notice of any significant
proposed change in their methods and
standards for setting payment rates for
services. They also appreciated the
inclusion of stakeholders in the process.
Commenters expressed agreement with
CMS that public input is important for
waiver development and that the input
process must be accessible to the public
(including persons with disabilities),
and a state must be required to make
efforts to ensure that those who want to
participate can do so.
Response: We concur with these
comments. We agree that the rule is
being changed to achieve the purposes
outlined by those commenters who
support the proposed rule change.
c. Selecting Strategies To Ensure
Compliance (§ 441.304(g))
In new paragraph, § 441.304(g), we
added language describing additional
strategies we may employ to ensure
state compliance with the requirements
of a waiver, short of termination or nonrenewal. Our regulation at new
§ 441.304(g) reflects an approach to
encourage state compliance. We are
interested in working with states to
achieve full compliance without having
to resort to termination of a waiver.
Therefore, we proposed strategies to
ensure compliance in serious situations
short of termination. These strategies
include use of a moratorium on waiver
enrollments or withholding federal
payment for waiver services or
administration of waiver services in
accordance with the seriousness and
nature of the state’s noncompliance.
These strategies could continue, if
necessary, as the Secretary determines
whether termination is warranted. Our
primary objective is to use such
strategies rarely, only after other efforts
to resolve issues to ensure the health
and welfare of individuals served or to
resolve other serious non-compliance
issues have not succeeded.
Once CMS employs a strategy to
ensure compliance, the state must
submit an acceptable corrective action
plan in order to resolve all areas of
noncompliance. The corrective action
plan must include detail on the actions
and timeframe the state will take to
correct each area of noncompliance,
including necessary changes to the
quality improvement strategy and a
detailed timeline for the completion and
implementation of corrective actions.
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We will determine if the corrective
action plan is acceptable.
We received 50 comments on
§ 441.304(g) regarding the actions we
can take if a Medicaid agency is
substantively out of compliance with
waiver requirements.
Comment: One commenter stated that
they believed the standard audit process
was the best way to achieve compliance.
Response: Onsite visits and audits are
a tool we utilize to ensure states clearly
understand our guidance and adhere to
regulatory requirements. After 30 years
of running the section 1915(c) waiver
program, it has become clear that other
methods are needed to ensure the
welfare of our beneficiaries.
Comment: Commenters stated their
concern with the potential harm to
beneficiaries that could result from
moratoria on waiver enrollments and
urged us to use the moratoria as a last
resort.
Response: We understand the
potential negative effects a moratorium
on waiver enrollments may have on
beneficiaries. Opportunities exist, such
as technical assistance and corrective
action plans, to assist a state to achieve
compliance without the use of a
moratorium. We will always be ready to
assist states through these means before
moving forward with a moratorium. We
also note that the main compliance tool
currently available to us, termination of
the waiver, has the potential to harm an
even higher number of individuals
needing HCBS.
Comment: Many commenters agreed
with the use of withholding a portion of
federal payment.
Response: Certain tools, such as
withholding a portion of federal
payment, will only be utilized when
necessary and after most other options
have been exhausted. At this time, we
believe we will see the necessary results
to be assured that the care of our
beneficiaries is foremost to states.
Comment: One commenter
recommended transparency as to where
withheld funds will go and how these
funds will be used.
Response: We are committed to
transparency. We will release the
information we are legally allowed to
make public.
Comment: One commenter suggested
we clarify whether the opportunity for
a hearing will be afforded when a state
disputes compliance rulings similar to
the processes and safeguards specified
in part 430 subpart D.
Response: We reiterate that these
additional enforcement measures are
part of a broader array of approaches we
may take to achieve and maintain full
compliance with the requirements
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specified in section 1915(c) of the Act,
in addition to waiver termination. States
will be afforded an opportunity to
appeal. The procedures specified in
subpart D of part 430 of this chapter are
applicable to state requests for hearings
on all non-compliance actions,
including terminations.
Comment: Many commenters wanted
assurances from CMS that due process
procedure will be followed before a
moratorium is set or funds are withheld
and that enforcements should be waiver
specific.
Response: The tools discussed to
ensure compliance will only be utilized
after we have tried several other
remedies, including technical assistance
and action plans. We will provide states
with a written notice of the impending
strategies to ensure compliance for a
waiver program. The notice of our intent
to use strategies to ensure compliance
will include the nature of the
noncompliance, the strategy to be
employed, the effective date of the
compliance strategy, the criteria for
removing the compliance strategy and
the opportunity for a hearing as
specified in subpart D of part 430.
Comment: One commenter suggested
that CMS develop a way to cover the
cost of training while a state is under a
compliance strategy.
Response: Compliance is a state’s
responsibility when accepting federal
financial funding. That funding may be
used to ensure compliance measures are
in place.
Comment: One commenter expressed
support for the use of compliance
strategies other than termination or
nonrenewal.
Response: We agree that additional
options for promoting and ensuring
state compliance with HCBS waiver
requirements should be available. We
have therefore added the phrase ‘‘or
other actions as determined by the
Secretary as necessary to address noncompliance with section 1915(c) of the
Act’’ to the regulation text.
IV. Provisions of the Final Regulations
A. 1915(k) Community First Choice and
1915(i) State Plan Home and
Community-Based Services
The provisions proposed as new
subpart L, consisting of § 441.650
through § 441.677, added to part 441
will be codified as subpart M, consisting
of § 441.700 through § 441.745.
For the most part, this final rule
incorporates the provisions of the
proposed rule. In response to comments
as explained in the responses in the
above section, those provisions of this
final rule that differ from the proposed
rule are as follows:
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3021
Under § 430.25 (waivers of State plan
requirements), we added ‘‘and in a
manner consistent with the interests of
beneficiaries and the objectives of the
Medicaid program.’’ This was language
from the preamble of the proposed rule,
for which we received a comment
requesting that it also be incorporated
into the text of the final regulation.
In response to many comments
received, and for the reasons provided
in the responses above for each specific
provision, we revised and added new
language to § 441.530(a), regarding
home and community-based setting
requirements for 1915(k) and to
§ 441.710(a), regarding home and
community-based setting requirements
for 1915(i). In addition to those specific
provisions, we examined the overall
themes of the commentary received and
our basis for the HCB settings
requirements as a whole. All of the
overall ideas may be found within the
summary of comments and our
responses in the above section, which
are organized by specific provisions of
the proposed rules.
In § 440.182(c)(8), which refers to
conditions set forth at § 440.180 for
persons with chronic mental illness, we
have revised this reference to
§ 440.180(d)(2) to be more precise.
Under eligibility for home and
community-based services under
§ 441.710(d), we corrected the reference
to target criteria from (b)(2) to (e)(2).
Under § 441.710(e)(2)(ii), we corrected
the reference to § 440.182(b) to
§ 440.182(c).
We have corrected § 441.715(b)(2) to
replace the reference to (c)(7) to instead
specify (c)(6).
We have corrected § 441.715(c) by
replacing ‘‘the Secretary will approve’’
with ‘‘the Secretary may approve.’’
We have corrected § 441.715(d) to
replace the reference to section
441.710(a)(1) to § 441.658.
In § 441.715(d)(2), we have revised
the reference to § 441.656 so that it now
reads correctly as a reference to
§ 435.219 and § 436.219.
At § 441.720(a)(1), we made a minor
correction and added a cross reference
after ‘‘person-centered process’’ to
§ 441.725(a).
At § 441.720(a)(1)(i)(A), we revised
the language to be consistent with other
language in this regulation.
We added ‘‘cognitive’’ to
§ 441.720(a)(4) in response to comments
received, to specifically include
assessment of needs related to cognitive
impairment.
We have revised the first sentence of
§ 441.720(a)(5).
In response to numerous comments
received regarding the section 1915(i) of
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the Act person-centered planning
process and person-centered service
plan, and in order to align these
requirements across sections 1915(c)
and 1915(i) of the Act HCBS, we have
modified the requirements in § 441.725
of this final rule. In addition, we
examined the overall themes of the
commentary received. An explanation
of changes to regulation as a result of
comments received may be found
within the responses in the section
above.
In § 441.730(c), we added ‘‘cognitive’’
and current knowledge of ‘‘available
resources, service options, and
providers’’ to this requirement.
We added a new statement to
§ 441.735(a) regarding the definition of
individual’s representative to indicate
that in instances where state law confers
decision-making authority to the
individual representative, the
individual will lead the service
planning process where possible and
the individual representative will have
a participatory role, as needed and as
defined by the individual.
We revised § 441.735(c).
We revised § 441.740(b)(4).
For clarity, we have moved the
requirement regarding financial
management supports that was
previously at both § 441.674(c)(2) and
§ 441.674(d)(4) of the proposed rule, to
a new (5) under § 441.740(b) of this final
rule.
We edited employer authority at
§ 441.740(c) to ensure consistency with
statutory language, by replacing ‘‘or’’
with ‘‘and’’ so that it now reads as ‘‘the
ability to select, manage, and dismiss
providers of State plan HCBS.’’
We revised § 441.740(e)(3).
Since advance notice is a topic in part
431, subpart E, we have added ‘‘advance
notice’’ to the regulation at
§ 441.745(a)(1)(iii).
We revised § 441.745(a)(2)(vi) to
specify that for renewal, the state’s
1915(i) benefit must meet the state’s
objectives with respect to quality
improvement and beneficiary outcomes.
We revised § 441.745(b)(1)(ii) to add
language that was in the preamble of the
proposed rule.
B. 1915(c) Home and Community Based
Services Waivers
We have outlined in section III of this
preamble the revisions in response to
the public comments. Those provisions
of this final rule that differ from the
proposed rule are as follows:
Based upon the complexities of the
comments received, we have
reorganized the regulations to finalize
the provisions proposed at
§ 441.301(b)(1)(i)(A) through
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§ 441.301(b)(1)(i)(B)(12) as new
paragraph § 441.301(c).
At § 441.301(c)(1) and (2), we made
some general revisions to the
terminology utilized to strengthen
language regarding services. We added
the term ‘‘supports’’ when referencing
services to now use the language
‘‘services and supports.’’ We also
revised person-centered plan as
‘‘person-centered service plan.’’
At § 441.301(c)(1)(i) we added
language to more clearly define the role
of the individual’s representative and
refer to the 1915(i) definition of the
individual’s representative at § 441.735
in this rule.
We have revised § 441.301(c)(i)(ii) to
more clearly state the individual’s role
in directing the person-centered
planning process.
We have revised § 441.301(c)(1)(iii) to
include a requirement for timeliness.
We have revised § 441.301(c)(1)(v) to
strengthen this language to direct that
the state devise clear conflict-of-interest
guidelines addressed to all parties who
participate in the person-centered
planning process.
We have added a new provision at
§ 441.301(c)(1)(vi) to clarify conflict of
interest standards pertaining to
providers of HCBS. The proposed text at
§ 441.301(b)(1)(i)(A)(6) through (8) all
shifted down by one number and are
included in the final rule at
§ 441.301(c)(1)(vii) through (ix).
We have revised § 441.301(c)(1)(vii) to
clarify that individuals should be
informed of all the possibilities from
which they may choose regarding
services, as well as the consequences of
these choices.
We added a new provision at
§ 441.301(c)(1)(ix) to clarify that the
setting in which an individual resides is
an important part of the person-centered
planning process.
We have revised § 441.301(c)(2) to
align the language with other HCBS
authorities.
We have added a new provision at
§ 441.301(c)(2)(i) to ensure that the
individual’s choice of setting is
documented in the person-centered
service plan. The proposed text at
441.301(b)(1)(i)(B)(1) through (5) all
shifted down by one number and is
included in the final rule at
§ 441.301(c)(2)(ii) through (vi). In
addition, we added language to ensure
community integration.
We have revised § 441.301(c)(2)(iii)
and (iv) to align the language with other
HCBS authorities.
We have revised § 441.301(c)(2)(v) by
adding further clarifying language
regarding ‘‘natural supports.’’
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We have revised previously numbered
§ 441.301(b)(1)(i)(B)(6) to clarify privacy
and control over personal information
and have moved this requirement to
§ 441.301(c)(2)(ix).
We have revised § 441.301(c)(2)(vi) to
strengthen the language regarding risks
for individuals.
We removed § 441.301(b)(1)(i)(B)(8)
from the final rule because this
requirement is a part of the personcentered planning requirements at
§ 441.301(c)(1)(iii) and (vii).
We revised § 441.301(c)(2)(xi) to
provide clarifying language regarding
the requirement for self-direction of
services.
We revised § 441.301(c)(2)(xii) to
replace the term ‘‘care’’ with the term
‘‘services and supports.’’
We added new language at
§ 441.301(c)(2)(xiii) and at
§ 441.301(c)(3) to align with other HCBS
authorities.
We revised § 441.301(c)(4) by
replacing the language with new
standards for HCBS settings that are
aligned with other HCBS authorities.
We added a provision at
§ 441.301(c)(5) to specify the settings
that are not home and communitybased.
We added a new provision at
§ 441.301(c)(6)to specify the
requirements for States to achieve
compliance with the HCB settings
standards.
We revised § 441.302(a)(4) to clarify
the expectations that each individual
within a waiver, regardless of target
group, has equal access to the services
necessary to meet their unique needs. In
addition, we made a technical
correction by changing ‘‘selects to
serve’’ to ‘‘elects to serve.’’
We have added a new provision at
§ 441.302(a)(4)(i) directing states to
annually report data in the quality
section of the CMS–372 regarding
serving multiple target groups in a
single waiver to ensure that a single
target group is not being prioritized to
the detriment of other groups.
We revised § 441.304(d)(1) to be more
specific about the kind of change that
constitutes a ‘‘substantive change’’
regarding HCBS waiver amendments.
We added a new provision at
§ 441.304(f)(2) to strengthen the public
notice and input process by including a
minimum time limit for posting notice
of changes.
We added a new provision at
§ 441.304(f)(3) to clarify when the
public input process applies.
We revised § 441.304(g)(3)(i) to clarify
that additional options for promoting
and ensuring state compliance with
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HCBS waiver requirements should be
allowed.
V. Collection of Information
Requirements
Under the Paperwork Reduction Act
of 1995, we are required to provide 60day notice in the Federal Register and
solicit public comment before a
collection of information requirement is
submitted to the Office of Management
and Budget (OMB) for review and
approval. In order to fairly evaluate
whether an information collection
should be approved by OMB, section
3506(c)(2)(A) of the Paperwork
Reduction Act of 1995 (PRA) requires
that we solicit comment on the
following issues:
• The need for the information
collection and its usefulness in carrying
out the proper functions of our agency.
• The accuracy of our estimate of the
information collection burden.
• The quality, utility, and clarity of
the information to be collected.
• Recommendations to minimize the
information collection burden on the
affected public, including automated
collection techniques.
We solicited public comment on each
of these issues for the following sections
of this document that contain
information collection requirements:
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• ICRs Regarding Individuals Receiving
State Plan Home and Community-based
Services (§ 435.219(b) and § 436.219(b))
To cover the categorically needy
eligibility group, the State would be
required to submit a SPA and may elect
to cover individuals who meet certain
requirements in § 435.219(a) or
§ 436.219(a). The burden associated
with this requirement is the time and
effort put forth by the State to complete,
review, process and transmit/submit the
pre-print which describes the eligibility
criteria for the group. We estimate it
would take each State 30 hours to meet
this one-time requirement. We estimate
that on an annual basis, 3 States will
submit a SPA to meet these
requirements; therefore, the total annual
burden hours for this requirement are 90
hours. We believe that a State employee,
with pay equivalent to GS–13 step one
($34.34 per hour) would be responsible
for this requirement. Thus, the cost for
each State is anticipated to be $1,030;
this equates to an annual cost of $3,091.
• ICRs Regarding Eligibility for State
Plan HCBS (§ 441.710) (Proposed
§ 441.656)
If a State elects to target the benefit to
specific populations, § 441.710(e)(2)
requires submission of targeting criteria
to CMS. The burden associated with this
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requirement is the time and effort put
forth by the State to establish such
criteria. We estimate it would take 1
State 10 hours to meet this one-time
requirement. We estimate that on an
annual basis, 3 States will submit a SPA
to offer the State plan HCBS benefit that
targets specific populations, and be
affected by this requirement; therefore,
the total annual burden hours for this
requirement is 30 hours. We believe that
a State employee, with pay equivalent to
GS–13 step one ($34.34 per hour) would
be responsible for this requirement.
Thus, the cost for each State is
anticipated to be $343; this equates to
an annual cost of $1,030.
• ICRs Regarding Needs-Based Criteria
and Evaluation § 441.715 (Proposed
§ 441.659)
Section 441.715(a) requires a State to
establish needs-based criteria for
determining an individual’s eligibility
under the State plan for the HCBS
benefit, and may establish needs-based
criteria for each specific service. The
burden associated with this requirement
is the time and effort put forth by the
State to establish such criteria. We
estimate it would take 1 State 24 hours
to meet this requirement. We estimate
that on an annual basis, 3 States will
submit a SPA to offer the State plan
HCBS benefit, and be affected by this
one-time requirement; therefore, the
total annual burden hours for this
requirement is 72 hours. We believe that
a State employee, with pay equivalent to
GS–13 step one ($34.34 per hour) would
be responsible for this requirement.
Thus, the cost for each responding State
is anticipated to be $824; this equates to
an annual cost of $2,472.
Section 441.715(b) reads that if a State
defines needs-based criteria for
individual State plan home and
community-based services, the needsbased institutional eligibility criteria
must be more stringent than the
combined effect of needs-based State
plan HCBS benefit eligibility criteria
and individual service criteria. Section
441.715(b)(1)(ii) requires the State to
submit the more stringent criteria to
CMS for inspection with the State plan
amendment that establishes the State
Plan HCBS benefit.
The burden associated with this
requirement is the time and effort for
the State to define the more stringent
criteria and submit it to CMS along with
the State plan amendment that
establishes the HCBS benefit. We
anticipate 3 States would be affected by
this requirement on an annual basis and
it would require 1 hour to prepare and
submit this information. The one-time
burden associated with this requirement
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3023
is 3 hours. We believe that a State
employee, with pay equivalent to GS–13
step one ($34.34 per hour) would be
responsible for this requirement. Thus,
the cost for each State is anticipated to
be $34; this equates to an annual cost of
$102. This would be a one-time burden
for each responding State.
Section 441.715(c) reads that a state
may modify the needs-based criteria
established under paragraph (a) of this
section, without prior approval from the
Secretary, if the number of individuals
enrolled in the state plan HCBS benefit
exceeds the projected number submitted
annually to CMS.
Section 441.715(c)(1) requires the
state to provide at least 60 days notice
of the proposed modification to the
Secretary, the public, and each
individual enrolled in the State plan
HCBS benefit. The State notice to the
Secretary will be considered an
amendment to the State plan.
Section 441.715(c)(2) requires the
State notice to the Secretary be
submitted as an amendment to the State
plan.
The burden associated with the
requirements found under § 441.715(c)
is the time and effort put forth by the
State to modify the needs-based criteria
and provide notification of the proposed
modification to the Secretary. We
estimate it would take 1 State 24 hours
to make the modifications and provide
notification. This would be a one-time
burden.
The total annual burden of these
requirements (§ 441.715(c),
§ 441.715(c)(1), and § 441.715(c)(2))
would vary according to the number of
States who choose to modify their
needs-based criteria. We do not expect
any States to make this modification in
the next 3 years, thus there is no
anticipated burden.
Section 441.715(d) states that
eligibility for the State plan HCBS
benefit is determined, for individuals
who meet the requirements of
§ 441.710(a)(1) through (5), through an
independent evaluation of each
individual that meets the specified
requirements. Section 441.715(d)(5)
requires the evaluator to obtain
information from existing records, and
when documentation is not current and
accurate, obtain any additional
information necessary to draw a valid
conclusion about the individual’s
support needs. Section 441.715(e)
requires at least annual reevaluations.
The burden associated with this
requirement is the time and effort put
forth by the evaluator to obtain
information to support their conclusion.
We estimate it would take one evaluator
2 hours per participant to obtain
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information as necessary. The total
annual burden of this requirement
would vary according to the number of
participants in each State who may
require and be eligible for HCBS under
the State plan. The individuals
performing this assessment would vary
based upon State benefit design, but
will likely include individuals such as
registered nurses, qualified
developmental disability professionals,
qualified mental health professionals,
case managers, or other professional
staff with experience providing services
to individuals with disabilities or the
elderly. While there is burden
associated with this requirement, we
believe the burden is exempt as defined
in 5 CFR 1320.3(b)(2) because the time,
effort, and financial resources necessary
to comply with this requirement would
be incurred by persons in the normal
course of their activities.
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• ICRs Regarding Independent
Assessments § 441.720 (Proposed
§ 441.662)
Section 441.720 requires the State to
provide for an independent assessment
of need in order to establish a personcentered service plan. At a minimum,
the person-centered service plan must
meet the requirements as discussed
under § 441.725.
While the burden associated with the
requirements under § 441.720 is subject
to the PRA, we believe the burden is
exempt as defined in 5 CFR 1320.3(b)(2)
because the time, effort, and financial
resources necessary to comply with this
requirement would be incurred by
persons in the normal course of their
activities.
• ICRs Regarding State Plan HCBS
Administration: State Responsibilities
and Quality Improvement § 441.745
(Proposed § 441.677)
Section 441.745(a)(1)(i) reads that a
State will annually provide CMS with
the projected number of individuals to
be enrolled in the benefit, and the actual
number of unduplicated individuals
enrolled in State plan HCBS in the
previous year.
The burden associated with this
requirement is the time and effort put
forth by the state to annually project the
number of individuals who will enroll
in State plan HCBS. We estimate it will
take one state 2 hours to meet this
requirement. The total annual burden of
these requirements would vary
according to the number of States
offering the State plan HCBS benefit.
The maximum total annual burden is
112 hours (56 States x 2 hours = 112
hours). We believe that a state
employee, with pay equivalent to GS–13
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step one ($34.34 per hour) would be
responsible for this requirement. Thus,
the anticipated for each state is
anticipated to be $69; this equates to a
maximum annual cost of $3,864 if all 56
states elect to provide this benefit. There
are currently six states with approved
State plan HCBS benefits. Thus, we
anticipate based on current benefits that
the total annual aggregated burden will
be $414.
Section 441.745(a)(2)(iii) reads that
the SPA to provide State plan HCBS
must contain a description of the
reimbursement methodology for each
covered service.
The burden associated with this
requirement is the time and effort put
forth by the state to describe the
reimbursement methodology for each
State plan HCBS. We estimate that it
will take one state an average of 2 hours
to determine the reimbursement
methodology for one covered HCBS.
This would be a one-time burden. The
total annual burden for this requirement
would vary according to the number of
services that the state chooses to include
in the state plan HCBS benefit. We
believe that a state employee, with pay
equivalent to GS–13 step one ($34.34
per hour) would be responsible for this
requirement. Thus, the cost to each state
for each covered service is anticipated
to be $69; this would vary based upon
the number of services covered. This
would be an annual burden for each
responding state. Since we have
estimated that 3 states will annually
describe the reimbursement
methodology, the total annual
aggregated burden associated with this
requirement is estimated to be $207.
Section 441.745(a)(2)(iv) reads that
the SPA to provide State plan HCBS
must contain a description of the State
Medicaid agency line of authority for
operating the State plan HCBS benefit,
including distribution of functions to
other entities.
The burden associated with this
requirement is the time and effort put
forth by the state to describe the State
Medicaid agency line of authority. We
estimate it will take one state 2 hours to
meet this requirement. Since we have
estimated that 3 states will annually
request State plan HCBS, the total
annual burden associated with this
requirement is estimated to be 6 hours.
This would be a one-time burden for
each responding state. We believe that
a state employee, with pay equivalent to
GS–13 step one ($34.34 per hour) would
be responsible for this requirement.
Thus, the cost for each State is
anticipated to be $69.
Section 441.745(a)(2)(vi) limits the
approval period for states that target the
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benefit to specific populations. If a state
elects to target the benefit, this section
requires a renewal application every 5
years in order to continue operation of
the benefit. Actual time to meet this
requirement will vary depending on the
scope of the program and any changes
the state includes. However, we
estimate that it will take one state an
average of 40 hours to meet this
requirement. This includes reviewing
the previous submission, making any
necessary changes to the state plan
document(s), and communicating with
CMS regarding the renewal. This burden
would occur once every five years and
would be recurring. We estimate that,
beginning in 2016, 3 states will annually
request renewal and the total burden
will be 120 hours. We believe that a
state employee, with pay equivalent to
GS–13 step one ($34.34 per hour) would
be responsible for this requirement.
Thus, the cost for each State is
anticipated to be $1,374; this equates to
an annual cost of $4,122. This would be
a burden for each State that targets its
benefit once every 5 years; however, this
burden will not take effect until 2016.
Section 441.745(b) requires States to
develop and implement a quality
improvement strategy that includes
methods for ongoing measurement of
program performance, quality of care,
and mechanisms for remediation and
improvement proportionate to the scope
of services in the State plan HCBS
benefit and the number of individuals to
be served, and make this information
available to CMS upon the frequency
determined by the Secretary or upon
request.
The burden associated with this
requirement is the time and effort put
forth by the state to develop and
implement a quality improvement
strategy, and to make this information
available to CMS upon the frequency
determined by the Secretary or upon
request. We estimate it will take one
state 45 hours for the development of
the strategy, and for making information
available to CMS. The total annual
burden of these requirements would
vary according to the number of states
offering the state plan HCBS benefit.
The maximum total annual burden is
estimated to be 2,520 hours (56 states ×
45 hours = 2,520 hours). We estimate
that the burden associated with
implementation of the quality
improvement strategy will greatly vary,
as the necessary time and effort to
perform these activities is dependent
upon the scope of the benefit and the
number of persons receiving state plan
HCBS. We believe that a state employee,
with pay equivalent to GS–13 step one
($34.34 per hour) would be responsible
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for this requirement. Thus, the cost for
each State is anticipated to be $1,545;
this equates to a maximum annual cost
of $86,537. Currently, there are 6 states
with approved benefits, thus we
anticipate an annual burden based on
current States of $9,270.
TABLE 1—ANNUAL RECORDKEEPING AND REPORTING REQUIREMENTS
Total
annual
burden
(hours)
Total labor
cost of
reporting
($)
90
34.34
1,030
0
1,030
10
30
34.34
1,030
0
1,030
3
24
72
34.34
2,472
0
2,472
3
3
1
3
34.34
103
0
103
0938–1148
6
6
2
12
34.34
414
0
414
0938–1148
3
3
2
6
34.34
207
0
207
0938–1148
3
3
2
6
34.34
207
0
207
0938–1148
6
6
45
270
34.34
9,270
0
9,270
....................
........................
....................
....................
489
....................
14,733
0
14,733
Regulation section(s)
Respondents
Responses
Burden per
response
(hours)
435.219(b) and 436.219(b) ...........
441.656(e)(2) of proposed rule;
441.710(e)(2) of final rule ..........
441.659(a) of proposed rule;
441.715(a) of final rule ..............
441.659(b) of proposed rule;
441.715(b) of final rule ..............
441.677(a)(1)(i) of proposed rule;
441.745 (a)(1)(i) of final rule .....
441.677(a)(2)(iii) of proposed rule;
441.745 (a)(2)(iii) of final rule ....
441.677(a)(2)(iv) of proposed rule;
441.745(a)(2)(iv) of final rule .....
441.677(b) of proposed rule;
441.745 of final rule ...................
0938–1148
3
3
30
0938–1148
3
3
0938–1148
3
0938–1148
Total .......................................
VI. Regulatory Impact Analysis
A. Statement of Need
The state plan HCBS benefit is
authorized under section 1915(i) of the
Act. Section 1915(i) was created by the
Deficit Reduction Act of 2005 (DRA)
and was amended by the Affordable
Care Act of 2010. The resulting statute
provides states with authority to
establish state plan HCBS benefits in
their Medicaid program.
These regulations are necessary in
order to include the state plan HCBS
within the Code of Federal Regulations
(CFR). Additionally, these regulations
provide states with direction and clarity
regarding the framework under which
the programs can be established.
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B. Overall Impact
We have examined the impacts of this
rule as required by Executive Order
12866 on Regulatory Planning and
Review (September 30, 1993) and
Executive 13563 on Improving
Regulation and Regulatory Review
(January 18, 2011), the Regulatory
Flexibility Act (RFA) (September 19,
1980, Pub. L. 96–354), section 1102(b) of
the Social Security Act, section 202 of
the Unfunded Mandates Reform Act of
1995 (March 22, 1995; Pub. L. 104–4),
Executive Order 13132 on Federalism
(August 4, 1999) and the Congressional
Review Act (5 U.S.C. 804(2).
Executive Orders 12866 and 13563
direct agencies to assess all costs and
benefits of available regulatory
alternatives and, if regulation is
necessary, to select regulatory
approaches that maximize net benefits
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Total
capital/
maintenance
costs
($)
Hourly labor
cost of
reporting
($)
OMB
Control No.
Jkt 232001
(including potential economic,
environmental, public health and safety
effects, distributive impacts, and
equity). Executive Order 13563
emphasizes the importance of
quantifying both costs and benefits, of
reducing costs, of harmonizing rules,
and of promoting flexibility. A
regulatory impact analysis (RIA) must
be prepared for major rules with
economically significant effects ($100
million or more in any one year). This
final rule has been designated an
‘‘economically significant’’ rule under
section 3(f)(1) of Executive Order 12866.
Accordingly, the rule has been reviewed
by the Office of Management and
Budget.
C. Overall Impacts
We estimate that, as a result of this
final rule, the Medicaid cost impact for
provisions under 1915(i) for fiscal year
(FY) 2014 will be $150 million for the
federal share and $115 million for the
state share. The estimates are adjusted
for a phase-in period during which
states gradually elected to offer the state
plan HCBS benefit. Furthermore, the
estimated total annual collection of
information requirements cost
(including fringe benefits and overhead)
to states is $21,805 (see section V.
Collection of Information
Requirements).
Provisions in this rule pertaining to
section 2601 of the Affordable Care Act:
5-Year Period for Demonstration
Projects (Waivers), Provider Payment
Reassignments, section 2401 of the
Affordable Care Act: 1915(k)
Community First Choice State Plan
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Total cost
($)
Option: Home and Community-Based
Setting Requirements, and 1915(c)
Home and Community-Based Services
Waivers will not impact federal or state
Medicaid funding. While States may
incur costs in coming into compliance
with these provisions in this rule, given
the variability in State programs, and
the varying extent to which some are
already complying, it is difficult to
estimate these costs.
D. Detailed Impacts
1. State Plan HCBS
State Medicaid programs will make
use of the optional flexibility afforded
by the state plan HCBS benefit to
provide needed long-term care HCBS to
eligible individuals the state has not had
means to serve previously, or to provide
services to these individuals more
efficiently and effectively. The state
plan HCBS benefit will afford states a
new means to comply with
requirements of the Olmstead decision,
to serve individuals in the most
integrated setting.
The cost of these services will be
dependent upon the number of states
electing to offer the benefit, the scope of
the benefits states design, and the
degree to which the benefits replace
existing Medicaid services. States have
more control over expenditures for this
benefit than over other state plan
services. For states that choose to offer
these services, states may specify limits
to the scope of HCBS, target the benefit
to specific populations, and have the
option to adjust needs-based criteria
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requirements if costs escalate too
rapidly.
If states elect to include the new
optional group, eligibility could be
expanded because the group may
include individuals who would not
otherwise be eligible for Medicaid.
However, costs of the state plan HCBS
benefit may be offset by lowered
potential federal and state costs of more
expensive institutional care.
Additionally, the requirement for a
written person-centered service plan,
and the provision of needed HCBS in
accordance with the person-centered
service plan, may discourage
inappropriate utilization of costly
services such as emergency room care
for routine procedures, which may be
beneficial to Medicare and Medicaid
when individuals are eligible for both
programs. If a state targets this benefit,
only individuals who meet the targeting
criteria would receive 1915(i) services
and be eligible for the group, thus
limiting Medicaid HCBS expansion.
After considering these factors, we
assumed that, if all states adopted this
measure, program expenditures would
increase by 1 percent of current HCBS
expenditure projections. We further
assumed that ultimately, states
representing 50 percent of the eligible
population would elect to offer this
benefit, and that this ultimate level
would be reached in FY 2014,. Based on
these assumptions, the federal and state
cost estimates are shown in Table 2.
TABLE 2—MEDICAID COST ESTIMATES RESULTING FROM CHANGES TO THE STATE PLAN HCBS BENEFIT
[FYs 2014–2018, in $millions]
FY 2014
FY 2015
FY 2016
FY 2017
FY 2018
FYs 2014–2018
Federal Share ..........................................................
State Share ..............................................................
$150
115
$165
125
$185
140
$200
155
$225
170
$925
705
Total ..................................................................
265
290
325
355
395
1,630
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The effect on Medicaid beneficiaries
who receive the state plan HCBS benefit
will be substantial and beneficial in
States where optional 1915(i) state plan
HCBS are included, as it will provide
eligible individuals with the
opportunity to receive needed long-term
care services and supports in their
homes and communities.
The state plan HCBS benefit will
afford business opportunities for
providers of the HCBS. We do not
anticipate any effects on other
providers. Section 1915(i) of the Act
delinks the HCBS from institutional
LOC, and requires that eligibility criteria
for the benefit include a threshold of
need less than that for institutional
LOC, so that it is unlikely that large
numbers of participants in the state plan
HCBS benefit will be discharged from
the facilities of Medicaid institutional
providers. There may be some
redistribution of services among
providers of existing non-institutional
Medicaid services into State plan HCBS,
but providers who meet qualifications
for the state plan HCBS benefit have the
option to enroll as providers of HCBS.
This rule has no direct effect on the
Medicare program; however, an indirect
and beneficial effect may occur if
individuals eligible for both Medicare
and Medicaid are enrolled in a state
plan HCBS benefit.
E. Alternatives Considered
This final rule incorporates provisions
of new section 1915(i) of the Act into
federal regulations, providing for
Medicaid coverage of a new optional
state plan benefit to furnish home and
community-based state plan services.
The statute provides states with an
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option under which to draw federal
matching funds; it does not impose any
requirements or costs on existing state
programs, on providers, or upon
beneficiaries. States retain their
authority to offer HCBS through the
existing authority granted under section
1915(c) waivers and under section 1115
waivers. States can also continue to
offer, and individuals can choose to
receive, some but not all components of
HCBS allowable under section 1915(i)
through existing state plan services such
as personal care or targeted case
management services.
1. Not Publishing a Rule
Section 1915(i) of the Act was
effective January 1, 2007. States may
propose state plan amendments (SPAs)
to establish the state plan HCBS benefit
with or without this final rule. We
considered whether this statute could be
self-implementing and require no
regulation. Section 1915(i) of the Act is
complex; many states have contacted us
for technical assistance in the absence of
published guidance, and some have
indicated they are waiting to submit a
state plan amendment until there is a
rule. We further considered whether a
State Medicaid Director letter would
provide sufficient guidance regarding
CMS review criteria for approval of an
SPA. We concluded that section 1915(i)
of the Act establishes significant new
features in the Medicaid program, and
that it was important to provide states
and the public the published invitation
for comment provided by the proposed
rule. Finally, state legislation and
judicial decisions are not alternatives to
a federal rule in this case since section
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1915(i) of the Act provides federally
funded benefits.
2. Modification of Existing Rules
We considered modifying existing
regulations at § 440.180, part 441
subpart G, Home and Community-Based
Services: Waiver Requirements, which
implement the section 1915(c) HCBS
waivers, to include the authority to offer
the state plan HCBS benefit. This would
have the advantage of not duplicating
certain requirements common to both
types of HCBS. However, we believe
that any such efficiency would be
outweighed by the substantial
discussion that would be required of the
differences between the Secretary’s
discretion to approve waivers under
section 1915(c) of the Act, and authority
to offer HCBS under the State plan at
section 1915(i) of the Act. While
Congress clearly considered the
experience to date with HCBS under
waivers when constructing section
1915(i) of the Act, it did not choose to
modify section 1915(c) of the Act, but
chose instead to create a new authority
at section 1915(i) of the Act.
F. Accounting Statement
As required by OMB Circular A–4
(available at https://
www.whitehouse.gov/omb/
circulars_a004_a-4), in the Table 3, we
have prepared an accounting statement
showing the classification of the
transfers and other impacts associated
with the provisions of this final rule.
This table provides our best estimate of
the increase in aggregate Medicaid
outlays resulting from offering states the
option to provide the state plan HCBS
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benefit established in section 1915(i) of
the Act.
TABLE 3—ACCOUNTING STATEMENT: CLASSIFICATION OF ESTIMATED TRANSFERS AND OTHER IMPACTS, FROM FYS 2014
TO 2018
[In $millions] a
Category
Transfers
Annualized Monetized Transfers .......................
3% Units Discount Rate $183.5 .......................
7% Units Discount Rate $182.1
From Whom To Whom? ....................................
Federal Government to Beneficiaries and/or State Governments b
Category
Transfers
Other Annualized Monetized Transfers .............
3% Units Discount Rate $138.6 .......................
7% Units Discount Rate $137.5
From Whom To Whom? ....................................
State Governments to Beneficiaries and/or State Governments b
Category
Costs
Total Annual Collection of Information Requirements Cost to States is $0.02.
a The potential benefits of this rule have not been quantified. If beneficiaries who newly use HCBS as a result of this rule are currently being institutionalized at states’ expense, the rule would generate some combination of savings to states (equal to the cost difference between institutionalization and HCBS) and benefits to beneficiaries of being at home or in some other setting in the community, rather than an institution. Similarly, there would be benefits to beneficiaries who newly use HCBS if they are currently not receiving needed services.
b If the current status is that beneficiaries are paying for services alternative to HCBS themselves, then transfers are flowing from federal and
state governments to beneficiaries. If beneficiaries are currently being institutionalized at states’ expense, then transfers are from the federal government to state governments and possibly between pools of money within a state—from one pool with inflexible spending rules that require institutional care to another pool that allows for HCBS. Finally, to the extent that beneficiaries are currently not receiving needed services, then
some portion of the impacts currently categorized as ‘‘transfers’’ would actually be societal costs.
G. Conclusion
We anticipate that states will make
widely varying use of the section 1915(i)
state plan HCBS benefit to provide
needed long-term care services for
Medicaid beneficiaries. These services
will be provided in the home or
alternative living arrangements in the
community, which is of benefit to the
beneficiary and is less costly than
institutional care. Requirements for
independent evaluation and assessment,
individualized care planning, and
requirements for a quality improvement
program will promote efficient and
effective use of Medicaid expenditures
for these services.
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VII. Regulatory Flexibility Act Analysis
The Regulatory Flexibility Act (RFA)
(September 19, 1980, Pub. L. 96–354), as
modified by the Small Business
Regulatory Enforcement Fairness Act of
1996 (SBREFA) (Pub. L. 104–121),
requires agencies to analyze options for
regulatory relief of small entities, if a
rule has a significant impact on a
substantial number of small entities. For
purposes of the RFA, small entities
include small businesses, nonprofit
organizations, and small governmental
jurisdictions. Most hospitals and most
other providers and suppliers are small
entities, either by nonprofit status or by
having revenues of less than $7.0
million to $34.5 million in any 1 year.
Medicaid providers are required, as a
matter of course, to follow the
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guidelines and procedures as specified
in state and federal laws and
regulations. Furthermore, this final rule
imposes no requirements or costs on
providers or suppliers for their existing
activities. The rule implements a new
optional state plan benefit established in
section 1915(i) of the Act. Small entities
that meet provider qualifications and
choose to provide HCBS under the state
plan will have a business opportunity
under this final rule. The Secretary has
determined that this final rule will not
have a significant economic impact on
a substantial number of small entities.
In addition, section 1102(b) of the Act
requires us to prepare a regulatory
impact analysis if a rule may have a
significant impact on the operations of
a substantial number of small rural
hospitals. This analysis must conform to
the provisions of section 604 of the
RFA. For purposes of section 1102(b) of
the Act, we define a small rural hospital
as a hospital that is located outside of
a metropolitan statistical area and has
fewer than 100 beds. This final rule
does not offer a change in the
administration of the provisions related
to small rural hospitals. Therefore, the
Secretary has determined that this final
rule will not have a significant impact
on the operations of a substantial
number of small rural hospitals.
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VIII. Unfunded Mandates Reform Act
Analysis
Section 202 of the Unfunded
Mandates Reform Act of 1995 (March
22, 1995, Pub. L. 104–4) requires that
agencies assess anticipated costs and
benefits before issuing any rule whose
mandates require spending in any 1 year
of $100 million in 1995 dollars, updated
annually for inflation. In 2013, that
threshold is approximately $141
million. This final rule does not
mandate any spending by state, local, or
tribal governments, in the aggregate, or
by the private sector, of $141 million.
IX. Federalism Analysis
Executive Order 13132 on Federalism
(August 4, 1999) establishes certain
requirements that an agency must meet
when it promulgates a proposed rule
(and subsequent final rule) that imposes
substantial direct requirement costs on
state and local governments, preempts
state law, or otherwise has federalism
implications. Since this regulation does
not impose any costs on state or local
governments, the requirements of E.O.
13132 are not applicable.
List of Subjects
42 CFR Part 430
Administrative practice and
procedure, Grant programs-health,
Medicaid, Reporting and recordkeeping
requirements.
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42 CFR Part 431
Grant programs-health, Health
facilities, Medicaid, Privacy, Reporting
and recordkeeping requirements.
42 CFR Part 435
Aid to Families With Dependent
Children, Grant programs-health,
Medicaid, Reporting and recordkeeping
requirements, Supplemental Security
Income, Wages.
42 CFR Part 436
Aid to Families With Dependent
Children, Grant programs-health, Guam,
Medicaid, Puerto Rico, Supplemental
Security Income (SSI), Virgin Islands.
42 CFR Part 440
Grant programs-health, Medicaid.
42 CFR Part 441
Aged, Family planning, Grant
programs-health, Infants and children,
Medicaid, Penalties, Reporting and
recordkeeping requirements.
42 CFR Part 447
Accounting, Administrative practice
and procedure, Drugs, Grant programshealth, Health facilities, Health
professions, Medicaid, Reporting and
recordkeeping requirements, Rural
areas.
For the reasons set forth in the
preamble, the Centers for Medicare &
Medicaid Services amends 42 CFR
chapter IV as set forth below:
PART 430—GRANTS TO STATES FOR
MEDICAL ASSISTANCE PROGRAMS
1. The authority citation for part 430
continues to read as follows:
■
Authority: Sec. 1102 of the Social Security
Act (42 U.S.C. 1302).
2. Section 430.25 is amended by
revising paragraphs (h)(2) to read as
follows:
■
§ 430.25 Waivers of State plan
requirements.
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*
*
*
*
*
(h) * * *
(2) Duration of waivers. (i) Home and
community-based services under section
1915(c) of the Act.
(A) The initial waiver is for a period
of 3 years and may be renewed
thereafter for periods of 5 years.
(B) For waivers that include
individuals who are dually eligible for
Medicare and Medicaid, 5-year initial
approval periods may be granted at the
discretion of the Secretary for waivers
meeting all necessary programmatic,
financial and quality requirements, and
in a manner consistent with the
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interests of beneficiaries and the
objectives of the Medicaid program.
(ii) Waivers under section 1915(b) of
the Act.
(A) The initial waiver is for a period
of 2 years and may be renewed for
additional periods of up to 2 years as
determined by the Administrator.
(B) For waivers that include
individuals who are dually eligible for
Medicare and Medicaid, 5-year initial
and renewal approval periods may be
granted at the discretion of the Secretary
for waivers meeting all necessary
programmatic, financial and quality
requirements, and in a manner
consistent with the interests of
beneficiaries and the objectives of the
Medicaid program.
(iii) Waivers under section 1916 of the
Act. The initial waiver is for a period of
2 years and may be renewed for
additional periods of up to 2 years as
determined by the Administrator.
*
*
*
*
*
PART 431—STATE ORGANIZATION
AND GENERAL ADMINISTRATION
3. The authority citation for part 431
continues to read as follows:
■
Authority: Sec. 1102 of the Social Security
Act (42 U.S.C. 1302).
4. Section 431.54 is amended by
adding new paragraphs (a)(3) and (h) to
read as follows:
■
§ 431.54 Exceptions to certain State plan
requirements .
(a) * * *
(3) Section 1915(i) of the Act provides
that a State may provide, as medical
assistance, home and community-based
services under an approved State plan
amendment that meets certain
requirements, without regard to the
requirements of sections 1902(a)(10)(B)
and 1902(a)(10)(C)(i)(III) of the Act, with
respect to such services.
*
*
*
*
*
(h) State plan home and communitybased services. The requirements of
§ 440.240 of this chapter related to
comparability of services do not apply
with respect to State plan home and
community-based services defined in
§ 440.182 of this chapter.
PART 435—ELIGIBILITY IN THE
STATES, DISTRICT OF COLUMBIA,
THE NORTHERN MARIANA ISLANDS,
AND AMERICAN SAMOA
6. Section 435.219 is added to subpart
C under the undesignated center
heading ‘‘Options for Coverage of
Families and Children and the Aged,
Blind, and Disabled’’ to read as follows:
■
§ 435.219 Individuals receiving State plan
home and community-based services.
If the agency provides State plan
home and community-based services to
individuals described in section
1915(i)(1), the agency, under its State
plan, may, in addition, provide
Medicaid to individuals in the
community who are described in one or
both of paragraphs (a) or (b) of this
section.
(a) Individuals who—
(1) Are not otherwise eligible for
Medicaid;
(2) Have income that does not exceed
150 percent of the Federal poverty line
(FPL);
(3) Meet the needs-based criteria
under § 441.715 of this chapter; and
(4) Will receive State plan home and
community-based services as defined in
§ 440.182 of this chapter.
(b) Individuals who—
(1) Would be determined eligible by
the agency under an existing waiver or
demonstration project under sections
1915(c), 1915(d), 1915(e) or 1115 of the
Act, but are not required to receive
services under such waivers or
demonstration projects;
(2) Have income that does not exceed
300 percent of the Supplemental
Security Income Federal Benefit Rate
(SSI/FBR); and
(3) Will receive State plan home and
community-based services as defined in
§ 440.182 of this chapter.
(c) For purposes of determining
eligibility under paragraph (a) of this
section, the agency may not take into
account an individual’s resources and
must use income standards that are
reasonable, consistent with the
objectives of the Medicaid program,
simple to administer, and in the best
interests of the beneficiary. Income
methodologies may include use of
existing income methodologies, such as
the SSI program rules. However, subject
to the Secretary’s approval, the agency
may use other income methodologies
that meet the requirements of this
paragraph.
PART 436—ELIGIBILITY IN GUAM,
PUERTO RICO AND THE VIRGIN
ISLANDS
■
5. The authority citation for part 435
continues to read as follows:
■
Authority: Sec. 1102 of the Social Security
Act (42 U.S.C. 1302).
Authority: Sec. 1102 of the Social Security
Act (42 U.S.C. 1302).
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7. The authority citation for part 436
continues to read as follows:
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8. Section 436.219 is added to read as
follows:
■
§ 436.219 Individuals receiving State plan
home and community-based services.
If the agency provides State plan
home and community-based services to
individuals described in section
1915(i)(1) of the Act, the agency, under
its State plan, may, in addition, provide
Medicaid to of individuals in the
community who are described in one or
both of paragraphs (a) or (b) of this
section.
(a) Individuals who—
(1) Are not otherwise eligible for
Medicaid;
(2) Have income that does not exceed
150 percent of the Federal poverty line
(FPL);
(3) Meet the needs-based criteria
under § 441.715 of this chapter; and
(4) Will receive State plan home and
community-based services as defined in
§ 440.182 of this chapter.
(b) Individuals who—
(1) Would be determined eligible by
the agency under an existing waiver or
demonstration project under sections
1915(c), 1915(d), 1915(e) or 1115 of the
Act, but are not required to receive
services under such waivers or
demonstration projects;
(2) Have income that does not exceed
300 percent of the Supplemental
Security Income Federal Benefit Rate
(SSI/FBR); and
(3) Will receive State plan home and
community-based services as defined in
§ 440.182 of this chapter.
(c) For purposes of determining
eligibility under paragraph (a) of this
section, the agency may not take into
account an individual’s resources and
must use income standards that are
reasonable, consistent with the
objectives of the Medicaid program,
simple to administer, and in the best
interests of the beneficiary. Income
methodologies may include use of
existing income methodologies, such as
the rules of the OAA, AB, APTD or
AABD programs. However, subject to
the Secretary’s approval, the agency
may use other income methodologies
that meet the requirements of this
paragraph.
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PART 440—SERVICES: GENERAL
PROVISIONS
9. The authority citation for part 440
continues to read as follows:
■
Authority: Sec. 1102 of the Social Security
Act (42 U.S.C. 1302).
10. Section 440.1 is amended by
adding the new statutory basis 1915(i)
in sequential order to read as follows:
■
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§ 440.1
Basis and purpose.
*
*
*
*
*
1915(i) Home and community-based
services furnished under a State plan to
elderly and disabled individuals.
■ 11. Section 440.180 is amended by
revising the section heading to read as
follows:
§ 440.180 Home and community-based
waiver services.
*
*
*
*
*
12. Section 440.182 is added to read
as follows:
■
§ 440.182 State plan home and
community-based services.
(a) Definition. State plan home and
community-based services (HCBS)
benefit means the services listed in
paragraph (c) of this section when
provided under the State’s plan (rather
than through an HCBS waiver program)
for individuals described in paragraph
(b) of this section.
(b) State plan HCBS coverage. State
plan HCBS can be made available to
individuals who—
(1) Are eligible under the State plan
and have income, calculated using the
otherwise applicable rules, including
any less restrictive income disregards
used by the State for that group under
section 1902(r)(2) of the Act, that does
not exceed 150 percent of the Federal
Poverty Line (FPL); and
(2) In addition to the individuals
described in paragraph (b)(1) of this
section, to individuals based on the
State’s election of the eligibility groups
described in § 435.219(b) or § 436.219(b)
of this chapter.
(c) Services. The State plan HCBS
benefit consists of one or more of the
following services:
(1) Case management services.
(2) Homemaker services.
(3) Home health aide services.
(4) Personal care services.
(5) Adult day health services.
(6) Habilitation services, which
include expanded habilitation services
as specified in § 440.180(c).
(7) Respite care services.
(8) Subject to the conditions in
§ 440.180(d)(2), for individuals with
chronic mental illness:
(i) Day treatment or other partial
hospitalization services;
(ii) Psychosocial rehabilitation
services;
(iii) Clinic services (whether or not
furnished in a facility).
(9) Other services requested by the
agency and approved by the Secretary as
consistent with the purpose of the
benefit.
(d) Exclusion. FFP is not available for
the cost of room and board in State plan
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3029
HCBS. The following HCBS costs are
not considered room or board for
purposes of this exclusion:
(1) The cost of temporary food and
shelter provided as an integral part of
respite care services in a facility
approved by the State.
(2) Meals provided as an integral
component of a program of adult day
health services or another service and
consistent with standard procedures in
the State for such a program.
(3) A portion of the rent and food
costs that may be reasonably attributed
to an unrelated caregiver providing
State plan HCBS who is residing in the
same household with the recipient, but
not if the recipient is living in the home
of the caregiver or in a residence that is
owned or leased by the caregiver.
PART 441—SERVICES:
REQUIREMENTS AND LIMITS
APPLICABLE TO SPECIFIC SERVICES
13. The authority citation for part 441
continues to read as follows:
■
Authority: Sec. 1102 of the Social Security
Act (42 U.S.C. 1302).
14. Section 441.301 is amended by
revising paragraphs (b)(1)(i) and (b)(6)
and adding paragraph (c) to read as
follows:
■
§ 441.301
Contents of request for a waiver.
*
*
*
*
*
(b) * * *
(1) * * *
(i) Under a written person-centered
service plan (also called plan of care)
that is based on a person-centered
approach and is subject to approval by
the Medicaid agency.
*
*
*
*
*
(6) Be limited to one or more of the
following target groups or any subgroup
thereof that the State may define:
(i) Aged or disabled, or both.
(ii) Individuals with Intellectual or
Developmental Disabilities, or both.
(iii) Mentally ill.
(c) A waiver request under this
subpart must include the following—
(1) Person-Centered Planning Process.
The individual will lead the personcentered planning process where
possible. The individual’s
representative should have a
participatory role, as needed and as
defined by the individual, unless State
law confers decision-making authority
to the legal representative. All
references to individuals include the
role of the individual’s representative.
In addition to being led by the
individual receiving services and
supports, the person-centered planning
process:
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(i) Includes people chosen by the
individual.
(ii) Provides necessary information
and support to ensure that the
individual directs the process to the
maximum extent possible, and is
enabled to make informed choices and
decisions.
(iii) Is timely and occurs at times and
locations of convenience to the
individual.
(iv) Reflects cultural considerations of
the individual and is conducted by
providing information in plain language
and in a manner that is accessible to
individuals with disabilities and
persons who are limited English
proficient, consistent with § 435.905(b)
of this chapter.
(v) Includes strategies for solving
conflict or disagreement within the
process, including clear conflict-ofinterest guidelines for all planning
participants.
(vi) Providers of HCBS for the
individual, or those who have an
interest in or are employed by a
provider of HCBS for the individual
must not provide case management or
develop the person-centered service
plan, except when the State
demonstrates that the only willing and
qualified entity to provide case
management and/or develop personcentered service plans in a geographic
area also provides HCBS. In these cases,
the State must devise conflict of interest
protections including separation of
entity and provider functions within
provider entities, which must be
approved by CMS. Individuals must be
provided with a clear and accessible
alternative dispute resolution process.
(vii) Offers informed choices to the
individual regarding the services and
supports they receive and from whom.
(viii) Includes a method for the
individual to request updates to the
plan as needed.
(ix) Records the alternative home and
community-based settings that were
considered by the individual.
(2) The Person-Centered Service Plan.
The person-centered service plan must
reflect the services and supports that are
important for the individual to meet the
needs identified through an assessment
of functional need, as well as what is
important to the individual with regard
to preferences for the delivery of such
services and supports. Commensurate
with the level of need of the individual,
and the scope of services and supports
available under the State’s 1915(c)
HCBS waiver, the written plan must:
(i) Reflect that the setting in which the
individual resides is chosen by the
individual. The State must ensure that
the setting chosen by the individual is
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integrated in, and supports full access of
individuals receiving Medicaid HCBS to
the greater community, including
opportunities to seek employment and
work in competitive integrated settings,
engage in community life, control
personal resources, and receive services
in the community to the same degree of
access as individuals not receiving
Medicaid HCBS.
(ii) Reflect the individual’s strengths
and preferences.
(iii) Reflect clinical and support needs
as identified through an assessment of
functional need.
(iv) Include individually identified
goals and desired outcomes.
(v) Reflect the services and supports
(paid and unpaid) that will assist the
individual to achieve identified goals,
and the providers of those services and
supports, including natural supports.
Natural supports are unpaid supports
that are provided voluntarily to the
individual in lieu of 1915(c) HCBS
waiver services and supports.
(vi) Reflect risk factors and measures
in place to minimize them, including
individualized back-up plans and
strategies when needed.
(vii) Be understandable to the
individual receiving services and
supports, and the individuals important
in supporting him or her. At a
minimum, for the written plan to be
understandable, it must be written in
plain language and in a manner that is
accessible to individuals with
disabilities and persons who are limited
English proficient, consistent with
§ 435.905(b) of this chapter.
(viii) Identify the individual and/or
entity responsible for monitoring the
plan.
(ix) Be finalized and agreed to, with
the informed consent of the individual
in writing, and signed by all individuals
and providers responsible for its
implementation.
(x) Be distributed to the individual
and other people involved in the plan.
(xi) Include those services, the
purpose or control of which the
individual elects to self-direct.
(xii) Prevent the provision of
unnecessary or inappropriate services
and supports.
(xiii) Document that any modification
of the additional conditions, under
paragraph (c)(4)(vi)(A) through (D) of
this section, must be supported by a
specific assessed need and justified in
the person-centered service plan. The
following requirements must be
documented in the person-centered
service plan:
(A) Identify a specific and
individualized assessed need.
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(B) Document the positive
interventions and supports used prior to
any modifications to the personcentered service plan.
(C) Document less intrusive methods
of meeting the need that have been tried
but did not work.
(D) Include a clear description of the
condition that is directly proportionate
to the specific assessed need.
(E) Include a regular collection and
review of data to measure the ongoing
effectiveness of the modification.
(F) Include established time limits for
periodic reviews to determine if the
modification is still necessary or can be
terminated.
(G) Include informed consent of the
individual.
(H) Include an assurance that
interventions and supports will cause
no harm to the individual.
(3) Review of the Person-Centered
Service Plan. The person-centered
service plan must be reviewed, and
revised upon reassessment of functional
need as required by § 441.365(e), at least
every 12 months, when the individual’s
circumstances or needs change
significantly, or at the request of the
individual.
(4) Home and Community-Based
Settings. Home and community-based
settings must have all of the following
qualities, and such other qualities as the
Secretary determines to be appropriate,
based on the needs of the individual as
indicated in their person-centered
service plan:
(i) The setting is integrated in and
supports full access of individuals
receiving Medicaid HCBS to the greater
community, including opportunities to
seek employment and work in
competitive integrated settings, engage
in community life, control personal
resources, and receive services in the
community, to the same degree of access
as individuals not receiving Medicaid
HCBS.
(ii) The setting is selected by the
individual from among setting options
including non-disability specific
settings and an option for a private unit
in a residential setting. The setting
options are identified and documented
in the person-centered service plan and
are based on the individual’s needs,
preferences, and, for residential settings,
resources available for room and board.
(iii) Ensures an individual’s rights of
privacy, dignity and respect, and
freedom from coercion and restraint.
(iv) Optimizes, but does not regiment,
individual initiative, autonomy, and
independence in making life choices,
including but not limited to, daily
activities, physical environment, and
with whom to interact.
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(v) Facilitates individual choice
regarding services and supports, and
who provides them.
(vi) In a provider-owned or controlled
residential setting, in addition to the
qualities at § 441.301(c)(4)(i) through
(v), the following additional conditions
must be met:
(A) The unit or dwelling is a specific
physical place that can be owned,
rented, or occupied under a legally
enforceable agreement by the individual
receiving services, and the individual
has, at a minimum, the same
responsibilities and protections from
eviction that tenants have under the
landlord/tenant law of the State, county,
city, or other designated entity. For
settings in which landlord tenant laws
do not apply, the State must ensure that
a lease, residency agreement or other
form of written agreement will be in
place for each HCBS participant, and
that the document provides protections
that address eviction processes and
appeals comparable to those provided
under the jurisdiction’s landlord tenant
law.
(B) Each individual has privacy in
their sleeping or living unit:
(1) Units have entrance doors lockable
by the individual, with only appropriate
staff having keys to doors.
(2) Individuals sharing units have a
choice of roommates in that setting.
(3) Individuals have the freedom to
furnish and decorate their sleeping or
living units within the lease or other
agreement.
(C) Individuals have the freedom and
support to control their own schedules
and activities, and have access to food
at any time.
(D) Individuals are able to have
visitors of their choosing at any time.
(E) The setting is physically accessible
to the individual.
(F) Any modification of the additional
conditions, under § 441.301(c)(4)(vi)(A)
through (D), must be supported by a
specific assessed need and justified in
the person-centered service plan. The
following requirements must be
documented in the person-centered
service plan:
(1) Identify a specific and
individualized assessed need.
(2) Document the positive
interventions and supports used prior to
any modifications to the personcentered service plan.
(3) Document less intrusive methods
of meeting the need that have been tried
but did not work.
(4) Include a clear description of the
condition that is directly proportionate
to the specific assessed need.
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(5) Include regular collection and
review of data to measure the ongoing
effectiveness of the modification.
(6) Include established time limits for
periodic reviews to determine if the
modification is still necessary or can be
terminated.
(7) Include the informed consent of
the individual.
(8) Include an assurance that
interventions and supports will cause
no harm to the individual.
(5) Settings that are not Home and
Community-Based. Home and
community-based settings do not
include the following:
(i) A nursing facility;
(ii) An institution for mental diseases;
(iii) An intermediate care facility for
individuals with intellectual
disabilities;
(iv) A hospital; or
(v) Any other locations that have
qualities of an institutional setting, as
determined by the Secretary. Any
setting that is located in a building that
is also a publicly or privately operated
facility that provides inpatient
institutional treatment, or in a building
on the grounds of, or immediately
adjacent to, a public institution, or any
other setting that has the effect of
isolating individuals receiving Medicaid
HCBS from the broader community of
individuals not receiving Medicaid
HCBS will be presumed to be a setting
that has the qualities of an institution
unless the Secretary determines through
heightened scrutiny, based on
information presented by the State or
other parties, that the setting does not
have the qualities of an institution and
that the setting does have the qualities
of home and community-based settings.
(6) Home and Community-Based
Settings: Compliance and Transition:
(i) States submitting new and initial
waiver requests must provide
assurances of compliance with the
requirements of this section for home
and community-based settings as of the
effective date of the waiver.
(ii) CMS will require transition plans
for existing section 1915(c) waivers and
approved state plans providing home
and community-based services under
section 1915(i) to achieve compliance
with this section, as follows:
(A) For each approved section 1915(c)
HCBS waiver subject to renewal or
submitted for amendment within one
year after the effective date of this
regulation, the State must submit a
transition plan at the time of the waiver
renewal or amendment request that sets
forth the actions the State will take to
bring the specific waiver into
compliance with this section. The
waiver approval will be contingent on
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3031
the inclusion of the transition plan
approved by CMS. The transition plan
must include all elements required by
the Secretary; and within one hundred
and twenty days of the submission of
the first waiver renewal or amendment
request the State must submit a
transition plan detailing how the State
will operate all section 1915(c) HCBS
waivers and any section 1915(i) State
plan benefit in accordance with this
section. The transition plan must
include all elements including timelines
and deliverables as approved by the
Secretary.
(B) For States that do not have a
section 1915(c) HCBS waiver or a
section 1915(i) State plan benefit due for
renewal or proposed for amendments
within one year of the effective date of
this regulation, the State must submit a
transition plan detailing how the State
will operate all section 1915(c) HCBS
waivers and any section 1915(i) State
plan benefit in accordance with this
section. This plan must be submitted no
later than one year after the effective
date of this regulation. The transition
plan must include all elements
including timelines and deliverables as
approved by the Secretary.
(iii) A State must provide at least a 30day public notice and comment period
regarding the transition plan(s) that the
State intends to submit to CMS for
review and consideration, as follows:
(A) The State must at a minimum
provide two (2) statements of public
notice and public input procedures.
(B) The State must ensure the full
transition plan(s) is available to the
public for public comment.
(C) The State must consider and
modify the transition plan, as the State
deems appropriate, to account for public
comment.
(iv) A State must submit to CMS, with
the proposed transition plan:
(A) Evidence of the public notice
required.
(B) A summary of the comments
received during the public notice
period, reasons why comments were not
adopted, and any modifications to the
transition plan based upon those
comments.
(v) Upon approval by CMS, the State
will begin implementation of the
transition plans. The State’s failure to
submit an approvable transition plan as
required by this section and/or to
comply with the terms of the approved
transition plan may result in
compliance actions, including but not
limited to deferral/disallowance of
Federal Financial Participation.
■ 15. Section 441.302 is amended by
adding paragraphs (a)(4) and (a)(5) to
read as follows:
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State assurances.
*
*
*
*
*
(a) * * *
(4) Assurance that the State is able to
meet the unique service needs of the
individuals when the State elects to
serve more than one target group under
a single waiver, as specified in
§ 441.301(b)(6).
(i) On an annual basis the State will
include in the quality section of the
CMS–372 form (or any successor form
designated by CMS) data that indicates
the State continues to serve multiple
target groups in the single waiver and
that a single target group is not being
prioritized to the detriment of other
groups.
(5) Assurance that services are
provided in home and community based
settings, as specified in § 441.301(c)(4).
■ 16. Section 441.304 is amended by—
■ A. Revising the section heading as set
forth below.
■ B. Redesignating paragraph (d) as new
paragraph (g).
■ C. Adding new paragraphs (d), (e), and
(f).
■ D. Revising newly designated
paragraph (g).
The additions and revisions read as
follows:
§ 441.304 Duration, extension, and
amendment of a waiver.
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*
*
*
*
*
(d) The agency may request that
waiver modifications be made effective
retroactive to the first day of a waiver
year, or another date after the first day
of a waiver year, in which the
amendment is submitted, unless the
amendment involves substantive
changes as determined by CMS.
(1) Substantive changes include, but
are not limited to, revisions to services
available under the waiver including
elimination or reduction of services, or
reduction in the scope, amount, and
duration of any service, a change in the
qualifications of service providers,
changes in rate methodology or a
constriction in the eligible population.
(2) A request for an amendment that
involves a substantive change as
determined by CMS, may only take
effect on or after the date when the
amendment is approved by CMS, and
must be accompanied by information on
how the State has assured smooth
transitions and minimal effect on
individuals adversely impacted by the
change.
(e) The agency must provide public
notice of any significant proposed
change in its methods and standards for
setting payment rates for services in
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accordance with § 447.205 of this
chapter.
(f) The agency must establish and use
a public input process, for any changes
in the services or operations of the
waiver.
(1) This process must be described
fully in the State’s waiver application
and be sufficient in light of the scope of
the changes proposed, to ensure
meaningful opportunities for input for
individuals served, or eligible to be
served, in the waiver.
(2) This process must be completed at
a minimum of 30 days prior to
implementation of the proposed change
or submission of the proposed change to
CMS, whichever comes first.
(3) This process must be used for both
existing waivers that have substantive
changes proposed, either through the
renewal or the amendment process, and
new waivers.
(4) This process must include
consultation with Federally-recognized
Tribes, and in accordance with section
5006(e) of the American Recovery and
Reinvestment Act of 2009 (Pub. L. 111–
5), Indian health programs and Urban
Indian Organizations.
(g)(1) If CMS finds that the Medicaid
agency is not meeting one or more of the
requirements for a waiver contained in
this subpart, the agency is given a notice
of CMS’ findings and an opportunity for
a hearing to rebut the findings.
(2) If CMS determines that the agency
is substantively out of compliance with
this subpart after the notice and any
hearing, CMS may employ strategies to
ensure compliance as described in
paragraph (g)(3) of this section or
terminate the waiver.
(3)(i) Strategies to ensure compliance
may include the imposition of a
moratorium on waiver enrollments,
other corrective strategies as appropriate
to ensure the health and welfare of
waiver participants, or the withholding
of a portion of Federal payment for
waiver services until such time that
compliance is achieved, or other actions
as determined by the Secretary as
necessary to address non-compliance
with 1915(c) of the Act, or termination.
When a waiver is terminated, the State
must comport with § 441.307.
(ii) CMS will provide states with a
written notice of the impending
strategies to ensure compliance for a
waiver program. The notice of CMS’
intent to utilize strategies to ensure
compliance would include the nature of
the noncompliance, the strategy to be
employed, the effective date of the
compliance strategy, the criteria for
removing the compliance strategy and
the opportunity for a hearing.
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17. Section 441.530 is added to read
as follows:
■
§ 441.530
Setting.
Home and Community-Based
(a) States must make available
attendant services and supports in a
home and community-based setting
consistent with both paragraphs (a)(1)
and (a)(2) of this section.
(1) Home and community-based
settings must have all of the following
qualities, and such other qualities as the
Secretary determines to be appropriate,
based on the needs of the individual as
indicated in their person-centered
service plan:
(i) The setting is integrated in and
supports full access of individuals
receiving Medicaid HCBS to the greater
community, including opportunities to
seek employment and work in
competitive integrated settings, engage
in community life, control personal
resources, and receive services in the
community, to the same degree of access
as individuals not receiving Medicaid
HCBS.
(ii) The setting is selected by the
individual from among setting options,
including non-disability specific
settings and an option for a private unit
in a residential setting. The setting
options are identified and documented
in the person-centered service plan and
are based on the individual’s needs,
preferences, and, for residential settings,
resources available for room and board.
(iii) Ensures an individual’s rights of
privacy, dignity and respect, and
freedom from coercion and restraint.
(iv) Optimizes but does not regiment
individual initiative, autonomy, and
independence in making life choices,
including but not limited to, daily
activities, physical environment, and
with whom to interact.
(v) Facilitates individual choice
regarding services and supports, and
who provides them.
(vi) In a provider-owned or controlled
residential setting, in addition to the
above qualities at paragraphs (a)(1)(i)
through (v) of this section, the following
additional conditions must be met:
(A) The unit or dwelling is a specific
physical place that can be owned,
rented or occupied under a legally
enforceable agreement by the individual
receiving services, and the individual
has, at a minimum, the same
responsibilities and protections from
eviction that tenants have under the
landlord tenant law of the State, county,
city or other designated entity. For
settings in which landlord tenant laws
do not apply, the State must ensure that
a lease, residency agreement or other
form of written agreement will be in
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place for each participant and that the
document provides protections that
address eviction processes and appeals
comparable to those provided under the
jurisdiction’s landlord tenant law.
(B) Each individual has privacy in
their sleeping or living unit:
(1) Units have entrance doors lockable
by the individual, with only appropriate
staff having keys to doors as needed.
(2) Individuals sharing units have a
choice of roommates in that setting.
(3) Individuals have the freedom to
furnish and decorate their sleeping or
living units within the lease or other
agreement.
(C) Individuals have the freedom and
support to control their own schedules
and activities, and have access to food
at any time.
(D) Individuals are able to have
visitors of their choosing at any time.
(E) The setting is physically accessible
to the individual.
(F) Any modification of the additional
conditions, under paragraphs
(a)(1)(vi)(A) through (D) of this section,
must be supported by a specific
assessed need and justified in the
person-centered service plan. The
following requirements must be
documented in the person-centered
service plan:
(1) Identify a specific and
individualized assessed need.
(2) Document the positive
interventions and supports used prior to
any modifications to the personcentered service plan.
(3) Document less intrusive methods
of meeting the need that have been tried
but did not work.
(4) Include a clear description of the
condition that is directly proportionate
to the specific assessed need.
(5) Include regulation collection and
review of data to measure the ongoing
effectiveness of the modification.
(6) Include established time limits for
periodic reviews to determine if the
modification is still necessary or can be
terminated.
(7) Include the informed consent of
the individual.
(8) Include an assurance that
interventions and supports will cause
no harm to the individual.
(2) Home and community-based
settings do not include the following:
(i) A nursing facility;
(ii) An institution for mental diseases;
(iii) An intermediate care facility for
individuals with intellectual
disabilities;
(iv) A hospital providing long-term
care services; or
(v) Any other locations that have
qualities of an institutional setting, as
determined by the Secretary. Any
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setting that is located in a building that
is also a publicly or privately operated
facility that provides inpatient
institutional treatment, or in a building
on the grounds of, or immediately
adjacent to, a public institution, or any
other setting that has the effect of
isolating individuals receiving Medicaid
HCBS from the broader community of
individuals not receiving Medicaid
HCBS will be presumed to be a setting
that has the qualities of an institution
unless the Secretary determines through
heightened scrutiny, based on
information presented by the State or
other parties, that the setting does not
have the qualities of an institution and
that the setting does have the qualities
of home and community-based settings.
(b) [Reserved]
18. A new subpart M, consisting of
§ 441.700 through § 441.745, is added to
part 441 to read as follows:
■
Subpart M—State Plan Home and
Community-Based Services for Elderly and
Disabled Individuals
Sec.
441.700 Basis and purpose.
441.705 State plan requirements.
441.710 State plan home and communitybased services under section 1915(i)(1) of
the Act.
441.715 Needs-based criteria and
evaluation.
441.720 Independent assessment.
441.725 Person-centered service plan.
441.730 Provider qualifications.
441.735 Definition of individual’s
representative.
441.740 Self-directed services.
441.745 State plan HCBS administration:
State responsibilities and quality
improvement.
Subpart M—State Plan Home and
Community-Based Services for the
Elderly and Individuals with
Disabilities
§ 441.700
Basis and purpose.
Section 1915(i) of the Act permits
States to offer one or more home and
community-based services (HCBS)
under their State Medicaid plans to
qualified individuals with disabilities or
individuals who are elderly. Those
services are listed in § 440.182 of this
chapter, and are described by the State,
including any limitations of the
services. This optional benefit is known
as the State plan HCBS benefit. This
subpart describes what a State Medicaid
plan must provide when the State elects
to include the optional benefit, and
defines State responsibilities.
§ 441.705
State plan requirements.
A State plan that provides section
1915(i) of the Act State plan home and
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3033
community-based services must meet
the requirements of this subpart.
§ 441.710 State plan home and
community-based services under section
1915(i)(1) of the Act.
(a) Home and Community-Based
Setting. States must make State plan
HCBS available in a home and
community-based setting consistent
with both paragraphs (a)(1) and (a)(2) of
this section.
(1) Home and community-based
settings must have all of the following
qualities, and such other qualities as the
Secretary determines to be appropriate,
based on the needs of the individual as
indicated in their person-centered
service plan:
(i) The setting is integrated in and
supports full access of individuals
receiving Medicaid HCBS to the greater
community, including opportunities to
seek employment and work in
competitive integrated settings, engage
in community life, control personal
resources, and receive services in the
community, to the same degree of access
as individuals not receiving Medicaid
HCBS.
(ii) The setting is selected by the
individual from among setting options,
including non-disability specific
settings and an option for a private unit
in a residential setting. The setting
options are identified and documented
in the person–centered service plan and
are based on the individual’s needs,
preferences, and, for residential settings,
resources available for room and board.
(iii) Ensures an individual’s rights of
privacy, dignity and respect, and
freedom from coercion and restraint.
(iv) Optimizes, but does not regiment,
individual initiative, autonomy, and
independence in making life choices,
including but not limited to, daily
activities, physical environment, and
with whom to interact.
(v) Facilitates individual choice
regarding services and supports, and
who provides them.
(vi) In a provider-owned or controlled
residential setting, in addition to the
above qualities at paragraphs (a)(1)(i)
through (v) of this section, the following
additional conditions must be met:
(A) The unit or dwelling is a specific
physical place that can be owned,
rented, or occupied under a legally
enforceable agreement by the individual
receiving services, and the individual
has, at a minimum, the same
responsibilities and protections from
eviction that tenants have under the
landlord/tenant law of the state, county,
city, or other designated entity. For
settings in which landlord tenant laws
do not apply, the State must ensure that
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a lease, residency agreement or other
form of written agreement will be in
place for each HCBS participant and
that the document provides protections
that address eviction processes and
appeals comparable to those provided
under the jurisdiction’s landlord tenant
law;
(B) Each individual has privacy in
their sleeping or living unit:
(1) Units have entrance doors lockable
by the individual, with only appropriate
staff having keys to doors;
(2) Individuals sharing units have a
choice of roommates in that setting; and
(3) Individuals have the freedom to
furnish and decorate their sleeping or
living units within the lease or other
agreement.
(C) Individuals have the freedom and
support to control their own schedules
and activities, and have access to food
at any time;
(D) Individuals are able to have
visitors of their choosing at any time;
(E) The setting is physically accessible
to the individual; and
(F) Any modification of the additional
conditions, under paragraphs
(a)(1)(vi)(A) through (D) of this section,
must be supported by a specific
assessed need and justified in the
person-centered service plan. The
following requirements must be
documented in the person-centered
service plan:
(1) Identify a specific and
individualized assessed need.
(2) Document the positive
interventions and supports used prior to
any modifications to the personcentered service plan.
(3) Document less intrusive methods
of meeting the need that have been tried
but did not work.
(4) Include a clear description of the
condition that is directly proportionate
to the specific assessed need.
(5) Include regular collection and
review of data to measure the ongoing
effectiveness of the modification.
(6) Include established time limits for
periodic reviews to determine if the
modification is still necessary or can be
terminated.
(7) Include the informed consent of
the individual.
(8) Include an assurance that
interventions and supports will cause
no harm to the individual.
(2) Home and community-based
settings do not include the following:
(i) A nursing facility.
(ii) An institution for mental diseases.
(iii) An intermediate care facility for
individuals with intellectual
disabilities.
(iv) A hospital.
(v) Any other locations that have
qualities of an institutional setting, as
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determined by the Secretary. Any
setting that is located in a building that
is also a publicly or privately operated
facility that provides inpatient
institutional treatment, or in a building
on the grounds of, or immediately
adjacent to, a public institution, or any
other setting that has the effect of
isolating individuals receiving Medicaid
HCBS from the broader community of
individuals not receiving Medicaid
HCBS will be presumed to be a setting
that has the qualities of an institution
unless the Secretary determines through
heightened scrutiny, based on
information presented by the State or
other parties, that the setting does not
have the qualities of an institution and
that the setting does have the qualities
of home and community-based settings.
(3) Compliance and transition:
(i) States submitting state plan
amendments for new section 1915(i) of
the Act benefits must provide
assurances of compliance with the
requirements of this section for home
and community-based settings as of the
effective date of the state plan
amendment;
(ii) CMS will require transition plans
for existing section 1915(c) waivers and
approved state plans providing home
and community-based services under
section 1915(i) to achieve compliance
with this section, as follows:
(A) For each approved section 1915(i)
of the Act benefit subject to renewal or
submitted for amendment within one
year after the effective date of this
regulation, the State must submit a
transition plan at the time of the
renewal or amendment request that sets
forth the actions the State will take to
bring the specific 1915(i) State plan
benefit into compliance with this
section. The approval will be contingent
on the inclusion of the transition plan
approved by CMS. The transition plan
must include all elements required by
the Secretary; and within one hundred
and twenty days of the submission of
the first renewal or amendment request
the State must submit a transition plan
detailing how the State will operate all
section 1915(c) HCBS waivers and any
section 1915(i) State plan benefit in
accordance with this section. The
transition plan must include all
elements including timelines and
deliverables as approved by the
Secretary.
(B) For States that do not have a
section 1915(c) waiver or a section
1915(i) State plan benefit due for
renewal or proposed for amendments
within one year of the effective date of
this regulation, the State must submit a
transition plan detailing how the State
will operate all section 1915(c) waivers
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and any section 1915(i) State plan
benefit in accordance with this section.
This plan must be submitted no later
than one year after the effective date of
this regulation. The transition plan must
include all elements including timelines
and deliverables as approved by the
Secretary.
(iii) A State must provide at least a 30day public notice and comment period
regarding the transition plan(s) that the
State intends to submit to CMS for
review and consideration, as follows:
(A) The State must at a minimum
provide two (2) statements of public
notice and public input procedures.
(B) The State must ensure the full
transition plan(s) is available to the
public for public comment.
(C) The State must consider and
modify the transition plan, as the State
deems appropriate, to account for public
comment.
(iv) A State must submit to CMS, with
the proposed transition plan:
(A) Evidence of the public notice
required.
(B) A summary of the comments
received during the public notice
period, reasons why comments were not
adopted, and any modifications to the
transition plan based upon those
comments.
(v) Upon approval by CMS, the State
will begin implementation of the
transition plans. The State’s failure to
submit an approvable transition plan as
required by this section and/or to
comply with the terms of the approved
transition plan may result in
compliance actions, including but not
limited to deferral/disallowance of
Federal Financial Participation.
(b) Needs-Based Eligibility
Requirement. Meet needs-based criteria
for eligibility for the State plan HCBS
benefit, as required in § 441.715(a).
(c) Minimum State plan HCBS
Requirement. Be assessed to require at
least one section 1915(i) home and
community-based service at a frequency
determined by the State, as required in
§ 441.720(a)(5).
(d) Target Population. Meet any
applicable targeting criteria defined by
the State under the authority of
paragraph (e)(2) of this section.
(e) Nonapplication. The State may
elect in the State plan amendment
approved under this subpart not to
apply the following requirements when
determining eligibility:
(1) Section 1902(a)(10)(C)(i)(III) of the
Act, pertaining to income and resource
eligibility rules for the medically needy
living in the community, but only for
the purposes of providing State plan
HCBS.
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(2) Section 1902(a)(10)(B) of the Act,
pertaining to comparability of Medicaid
services, but only for the purposes of
providing section 1915(i) State plan
HCBS. In the event that a State elects
not to apply comparability
requirements:
(i) The State must describe the
group(s) receiving State plan HCBS,
subject to the Secretary’s approval.
Targeting criteria cannot have the
impact of limiting the pool of qualified
providers from which an individual
would receive services, or have the
impact of requiring an individual to
receive services from the same entity
from which they purchase their
housing. These groups must be defined
on the basis of any combination of the
following:
(A) Age.
(B) Diagnosis.
(C) Disability.
(D) Medicaid Eligibility Group.
(ii) The State may elect in the State
plan amendment to limit the availability
of specific services defined under the
authority of § 440.182(c) of this chapter
or to vary the amount, duration, or
scope of those services, to one or more
of the group(s) described in this
paragraph.
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§ 441.715 Needs-based criteria and
evaluation.
(a) Needs-based criteria. The State
must establish needs-based criteria for
determining an individual’s eligibility
under the State plan for the HCBS
benefit, and may establish needs-based
criteria for each specific service. Needsbased criteria are factors used to
determine an individual’s requirements
for support, and may include risk
factors. The criteria are not
characteristics that describe the
individual or the individual’s condition.
A diagnosis is not a sufficient factor on
which to base a determination of need.
A criterion can be considered needsbased if it is a factor that can only be
ascertained for a given person through
an individualized evaluation of need.
(b) More stringent institutional and
waiver needs-based criteria. The State
plan HCBS benefit is available only if
the State has in effect needs-based
criteria (as defined in paragraph (a) of
this section), for receipt of services in
nursing facilities as defined in section
1919(a) of the Act, intermediate care
facilities for individuals with
intellectual disabilities as defined in
§ 440.150 of this chapter, and hospitals
as defined in § 440.10 of this chapter for
which the State has established longterm level of care (LOC) criteria, or
waivers offering HCBS, and these needsbased criteria are more stringent than
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the needs-based criteria for the State
plan HCBS benefit. If the State defines
needs-based criteria for individual State
plan home and community-based
services, it may not have the effect of
limiting who can benefit from the State
plan HCBS in an unreasonable way, as
determined by the Secretary.
(1) These more stringent criteria must
meet the following requirements:
(i) Be included in the LOC
determination process for each
institutional service and waiver.
(ii) Be submitted for inspection by
CMS with the State plan amendment
that establishes the State Plan HCBS
benefit.
(iii) Be in effect on or before the
effective date of the State plan HCBS
benefit.
(2) In the event that the State modifies
institutional LOC criteria to meet the
requirements under paragraph (b) or
(c)(6) of this section that such criteria be
more stringent than the State plan HCBS
needs-based eligibility criteria, States
may continue to receive FFP for
individuals receiving institutional
services or waiver HCBS under the LOC
criteria previously in effect.
(c) Adjustment authority. The State
may modify the needs-based criteria
established under paragraph (a) of this
section, without prior approval from the
Secretary, if the number of individuals
enrolled in the State plan HCBS benefit
exceeds the projected number submitted
annually to CMS. The Secretary may
approve a retroactive effective date for
the State plan amendment modifying
the criteria, as early as the day following
the notification period required under
paragraph (c)(1) of this section, if all of
the following conditions are met:
(1) The State provides at least 60 days
notice of the proposed modification to
the Secretary, the public, and each
individual enrolled in the State plan
HCBS benefit.
(2) The State notice to the Secretary
is submitted as an amendment to the
State plan.
(3) The adjusted needs-based
eligibility criteria for the State plan
HCBS benefit are less stringent than
needs-based institutional and waiver
LOC criteria in effect after the
adjustment.
(4) Individuals who were found
eligible for the State plan HCBS benefit
before modification of the needs-based
criteria under this adjustment authority
must remain eligible for the HCBS
benefit until such time as:
(i) The individual no longer meets the
needs-based criteria used for the initial
determination of eligibility; or
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3035
(ii) The individual is no longer
eligible for or enrolled in Medicaid or
the HCBS benefit.
(5) Any changes in service due to the
modification of needs-based criteria
under this adjustment authority are
treated as actions as defined in
§ 431.201 of this chapter and are subject
to the requirements of part 431, subpart
E of this chapter.
(6) In the event that the State also
needs to modify institutional level of
care criteria to meet the requirements
under paragraph (b) of this section that
such criteria be more stringent than the
State plan HCBS needs-based eligibility
criteria, the State may adjust the
modified institutional LOC criteria
under this adjustment authority. The
adjusted institutional LOC criteria must
be at least as stringent as those in effect
before they were modified to meet the
requirements in paragraph (b) of this
section.
(d) Independent evaluation and
determination of eligibility. Eligibility
for the State plan HCBS benefit must be
determined through an independent
evaluation of each individual according
to the requirements of this subpart. The
independent evaluation complies with
the following requirements:
(1) Is performed by an agent that is
independent and qualified as defined in
§ 441.730.
(2) Applies the needs-based eligibility
criteria that the State has established
under paragraph (a) of this section, and
the general eligibility requirements
under § 435.219 and § 436.219 of this
chapter.
(3) Includes consultation with the
individual, and if applicable, the
individual’s representative as defined
under § 441.735.
(4) Assesses the individual’s support
needs.
(5) Uses only current and accurate
information from existing records, and
obtains any additional information
necessary to draw valid conclusions
about the individual’s support needs.
(6) Evaluations finding that an
individual is not eligible for the State
plan HCBS benefit are treated as actions
defined in § 431.201 of this chapter and
are subject to the requirements of part
431 subpart E of this chapter.
(e) Periodic redetermination.
Independent reevaluations of each
individual receiving the State plan
HCBS benefit must be performed at least
every 12 months, to determine whether
the individual continues to meet
eligibility requirements.
Redeterminations must meet the
requirements of paragraph (d) of this
section.
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§ 441.720
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Independent assessment.
(a) Requirements. For each individual
determined to be eligible for the State
plan HCBS benefit, the State must
provide for an independent assessment
of needs, which may include the results
of a standardized functional needs
assessment, in order to establish a
service plan. In applying the
requirements of section 1915(i)(1)(F) of
the Act, the State must:
(1) Perform a face-to-face assessment
of the individual by an agent who is
independent and qualified as defined in
§ 441.730, and with a person-centered
process that meets the requirements of
§ 441.725(a) and is guided by best
practice and research on effective
strategies that result in improved health
and quality of life outcomes.
(i) For the purposes of this section, a
face-to-face assessment may include
assessments performed by telemedicine,
or other information technology
medium, if the following conditions are
met:
(A) The agent performing the
assessment is independent and qualified
as defined in § 441.730 and meets the
provider qualifications defined by the
State, including any additional
qualifications or training requirements
for the operation of required
information technology.
(B) The individual receives
appropriate support during the
assessment, including the use of any
necessary on-site support-staff.
(C) The individual provides informed
consent for this type of assessment.
(ii) [Reserved]
(2) Conduct the assessment in
consultation with the individual, and if
applicable, the individual’s authorized
representative, and include the
opportunity for the individual to
identify other persons to be consulted,
such as, but not limited to, the
individual’s spouse, family, guardian,
and treating and consulting health and
support professionals responsible for
the individual’s care.
(3) Examine the individual’s relevant
history including the findings from the
independent evaluation of eligibility,
medical records, an objective evaluation
of functional ability, and any other
records or information needed to
develop the person-centered service
plan as required in § 441.725.
(4) Include in the assessment the
individual’s physical, cognitive, and
behavioral health care and support
needs, strengths and preferences,
available service and housing options,
and if unpaid caregivers will be relied
upon to implement any elements of the
person-centered service plan, a
caregiver assessment.
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(5) For each service, apply the State’s
additional needs-based criteria (if any)
that the individual may require.
Individuals are considered enrolled in
the State plan HCBS benefit only if they
meet the eligibility and needs-based
criteria for the benefit, and are also
assessed to require and receive at least
one home and community-based service
offered under the State plan for medical
assistance.
(6) Include in the assessment, if the
State offers individuals the option to
self-direct a State plan home and
community-based service or services,
any information needed for the selfdirected portion of the service plan, as
required in § 441.740(b), including the
ability of the individual (with and
without supports) to exercise budget or
employer authority.
(7) Include in the assessment, for
individuals receiving habilitation
services, documentation that no
Medicaid services are provided which
would otherwise be available to the
individual, specifically including but
not limited to services available to the
individual through a program funded
under section 110 of the Rehabilitation
Act of 1973, or the Individuals with
Disabilities Education Improvement Act
of 2004.
(8) Include in the assessment and
subsequent service plan, for individuals
receiving Secretary approved services
under the authority of § 440.182 of this
chapter, documentation that no State
plan HCBS are provided which would
otherwise be available to the individual
through other Medicaid services or
other Federally funded programs.
(9) Include in the assessment and
subsequent service plan, for individuals
receiving HCBS through a waiver
approved under § 441.300,
documentation that HCBS provided
through the State plan and waiver are
not duplicative.
(10) Coordinate the assessment and
subsequent service plan with any other
assessment or service plan required for
services through a waiver authorized
under section 1115 or section 1915 of
the Social Security Act.
(b) Reassessments. The independent
assessment of need must be conducted
at least every 12 months and as needed
when the individual’s support needs or
circumstances change significantly, in
order to revise the service plan.
§ 441.725
Person-centered service plan.
(a) Person-centered planning process.
Based on the independent assessment
required in § 441.720, the State must
develop (or approve, if the plan is
developed by others) a written service
plan jointly with the individual
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(including, for purposes of this
paragraph, the individual and the
individual’s authorized representative if
applicable). The person-centered
planning process is driven by the
individual. The process:
(1) Includes people chosen by the
individual.
(2) Provides necessary information
and support to ensure that the
individual directs the process to the
maximum extent possible, and is
enabled to make informed choices and
decisions.
(3) Is timely and occurs at times and
locations of convenience to the
individual.
(4) Reflects cultural considerations of
the individual and is conducted by
providing information in plain language
and in a manner that is accessible to
individuals with disabilities and
persons who are limited English
proficient, consistent with § 435.905(b)
of this chapter.
(5) Includes strategies for solving
conflict or disagreement within the
process, including clear conflict of
interest guidelines for all planning
participants.
(6) Offers choices to the individual
regarding the services and supports the
individual receives and from whom.
(7) Includes a method for the
individual to request updates to the
plan, as needed.
(8) Records the alternative home and
community-based settings that were
considered by the individual.
(b) The person-centered service plan.
The person-centered service plan must
reflect the services and supports that are
important for the individual to meet the
needs identified through an assessment
of functional need, as well as what is
important to the individual with regard
to preferences for the delivery of such
services and supports. Commensurate
with the level of need of the individual,
and the scope of services and supports
available under the State plan HCBS
benefit, the written plan must:
(1) Reflect that the setting in which
the individual resides is chosen by the
individual. The State must ensure that
the setting chosen by the individual is
integrated in, and supports full access of
individuals receiving Medicaid HCBS to
the greater community, including
opportunities to seek employment and
work in competitive integrated settings,
engage in community life, control
personal resources, and receive services
in the community to the same degree of
access as individuals not receiving
Medicaid HCBS.
(2) Reflect the individual’s strengths
and preferences.
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(3) Reflect clinical and support needs
as identified through an assessment of
functional need.
(4) Include individually identified
goals and desired outcomes.
(5) Reflect the services and supports
(paid and unpaid) that will assist the
individual to achieve identified goals,
and the providers of those services and
supports, including natural supports.
Natural supports are unpaid supports
that are provided voluntarily to the
individual in lieu of State plan HCBS.
(6) Reflect risk factors and measures
in place to minimize them, including
individualized backup plans and
strategies when needed.
(7) Be understandable to the
individual receiving services and
supports, and the individuals important
in supporting him or her. At a
minimum, for the written plan to be
understandable, it must be written in
plain language and in a manner that is
accessible to individuals with
disabilities and persons who are limited
English proficient, consistent with
§ 435.905(b) of this chapter.
(8) Identify the individual and/or
entity responsible for monitoring the
plan.
(9) Be finalized and agreed to, with
the informed consent of the individual
in writing, and signed by all individuals
and providers responsible for its
implementation.
(10) Be distributed to the individual
and other people involved in the plan.
(11) Include those services, the
purchase or control of which the
individual elects to self-direct, meeting
the requirements of § 441.740.
(12) Prevent the provision of
unnecessary or inappropriate services
and supports.
(13) Document that any modification
of the additional conditions, under
§ 441.710(a)(1)(vi)(A) through (D) of this
chapter, must be supported by a specific
assessed need and justified in the
person-centered service plan. The
following requirements must be
documented in the person-centered
service plan:
(i) Identify a specific and
individualized assessed need.
(ii) Document the positive
interventions and supports used prior to
any modifications to the personcentered service plan.
(iii) Document less intrusive methods
of meeting the need that have been tried
but did not work.
(iv) Include a clear description of the
condition that is directly proportionate
to the specific assessed need.
(v) Include a regular collection and
review of data to measure the ongoing
effectiveness of the modification.
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(vi) Include established time limits for
periodic reviews to determine if the
modification is still necessary or can be
terminated.
(vii) Include informed consent of the
individual; and
(viii) Include an assurance that the
interventions and supports will cause
no harm to the individual.
(c) Reviewing the person-centered
service plan. The person-centered
service plan must be reviewed, and
revised upon reassessment of functional
need as required in § 441.720, at least
every 12 months, when the individual’s
circumstances or needs change
significantly, and at the request of the
individual.
§ 441.730
Provider qualifications.
(a) Requirements. The State must
provide assurances that necessary
safeguards have been taken to protect
the health and welfare of enrollees in
State plan HCBS, and must define in
writing standards for providers (both
agencies and individuals) of HCBS and
for agents conducting individualized
independent evaluation, independent
assessment, and service plan
development.
(b) Conflict of interest standards. The
State must define conflict of interest
standards that ensure the independence
of individual and agency agents who
conduct (whether as a service or an
administrative activity) the independent
evaluation of eligibility for State plan
HCBS, who are responsible for the
independent assessment of need for
HCBS, or who are responsible for the
development of the service plan. The
conflict of interest standards apply to all
individuals and entities, public or
private. At a minimum, these agents
must not be any of the following:
(1) Related by blood or marriage to the
individual, or to any paid caregiver of
the individual.
(2) Financially responsible for the
individual.
(3) Empowered to make financial or
health-related decisions on behalf of the
individual.
(4) Holding financial interest, as
defined in § 411.354 of this chapter, in
any entity that is paid to provide care
for the individual.
(5) Providers of State plan HCBS for
the individual, or those who have an
interest in or are employed by a
provider of State plan HCBS for the
individual, except when the State
demonstrates that the only willing and
qualified agent to perform independent
assessments and develop personcentered service plans in a geographic
area also provides HCBS, and the State
devises conflict of interest protections
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3037
including separation of agent and
provider functions within provider
entities, which are described in the
State plan for medical assistance and
approved by the Secretary, and
individuals are provided with a clear
and accessible alternative dispute
resolution process.
(c) Training. Qualifications for agents
performing independent assessments
and plans of care must include training
in assessment of individuals whose
physical, cognitive, or mental
conditions trigger a potential need for
home and community-based services
and supports, and current knowledge of
available resources, service options,
providers, and best practices to improve
health and quality of life outcomes.
§ 441.735 Definition of individual’s
representative.
In this subpart, the term individual’s
representative means, with respect to an
individual being evaluated for, assessed
regarding, or receiving State plan HCBS,
the following:
(a) The individual’s legal guardian or
other person who is authorized under
State law to represent the individual for
the purpose of making decisions related
to the person’s care or well-being. In
instances where state law confers
decision-making authority to the
individual representative, the
individual will lead the service
planning process to the extent possible.
(b) Any other person who is
authorized under § 435.923 of this
chapter, or under the policy of the State
Medicaid Agency to represent the
individual, including but not limited to,
a parent, a family member, or an
advocate for the individual.
(c) When the State authorizes
representatives in accordance with
paragraph (b) of this section, the State
must have policies describing the
process for authorization; the extent of
decision-making authorized; and
safeguards to ensure that the
representative uses substituted
judgment on behalf of the individual.
State policies must address exceptions
to using substituted judgment when the
individual’s wishes cannot be
ascertained or when the individual’s
wishes would result in substantial harm
to the individual. States may not refuse
the authorized representative that the
individual chooses, unless in the
process of applying the requirements for
authorization, the State discovers and
can document evidence that the
representative is not acting in
accordance with these policies or
cannot perform the required functions.
States must continue to meet the
requirements regarding the person-
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§ 441.740
Self-directed services.
(a) State option. The State may choose
to offer an election for self-directing
HCBS. The term ‘‘self-directed’’ means,
with respect to State plan HCBS listed
in § 440.182 of this chapter, services
that are planned and purchased under
the direction and control of the
individual, including the amount,
duration, scope, provider, and location
of the HCBS. For purposes of this
paragraph, individual means the
individual and, if applicable, the
individual’s representative as defined in
§ 441.735.
(b) Service plan requirement. Based
on the independent assessment required
in § 441.720, the State develops a
service plan jointly with the individual
as required in § 441.725. If the
individual chooses to direct some or all
HCBS, the service plan must meet the
following additional requirements:
(1) Specify the State plan HCBS that
the individual will be responsible for
directing.
(2) Identify the methods by which the
individual will plan, direct or control
services, including whether the
individual will exercise authority over
the employment of service providers
and/or authority over expenditures from
the individualized budget.
(3) Include appropriate risk
management techniques that explicitly
recognize the roles and sharing of
responsibilities in obtaining services in
a self-directed manner and assure the
appropriateness of this plan based upon
the resources and support needs of the
individual.
(4) Describe the process for facilitating
voluntary and involuntary transition
from self-direction including any
circumstances under which transition
out of self-direction is involuntary.
There must be state procedures to
ensure the continuity of services during
the transition from self-direction to
other service delivery methods.
(5) Specify the financial management
supports, as required in paragraph (e) of
this section, to be provided.
(c) Employer authority. If the personcentered service plan includes authority
to select, manage, or dismiss providers
of the State plan HCBS, the personcentered service plan must specify the
authority to be exercised by the
individual, any limits to the authority,
and specify parties responsible for
functions outside the authority the
individual exercises.
(d) Budget authority. If the personcentered service plan includes an
individualized budget (which identifies
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the dollar value of the services and
supports under the control and
direction of the individual), the personcentered service plan must meet the
following requirements:
(1) Describe the method for
calculating the dollar values in the
budget, based on reliable costs and
service utilization.
(2) Define a process for making
adjustments in dollar values to reflect
changes in an individual’s assessment
and service plan.
(3) Provide a procedure to evaluate
expenditures under the budget.
(4) Not result in payment for medical
assistance to the individual.
(e) Functions in support of selfdirection. When the State elects to offer
self-directed State plan HCBS, it must
offer the following individualized
supports to individuals receiving the
services and their representatives:
(1) Information and assistance
consistent with sound principles and
practice of self-direction.
(2) Financial management supports to
meet the following requirements:
(i) Manage Federal, State, and local
employment tax, labor, worker’s
compensation, insurance, and other
requirements that apply when the
individual functions as the employer of
service providers.
(ii) Make financial transactions on
behalf of the individual when the
individual has personal budget
authority.
(iii) Maintain separate accounts for
each individual’s budget and provide
periodic reports of expenditures against
budget in a manner understandable to
the individual.
(3) Voluntary training on how to
select, manage, and dismiss providers of
State plan HCBS.
§ 441.745 State plan HCBS administration:
State responsibilities and quality
improvement.
(a) State plan HCBS administration.
(1) State responsibilities. The State
must carry out the following
responsibilities in administration of its
State plan HCBS:
(i) Number served. The State will
annually provide CMS with the
projected number of individuals to be
enrolled in the benefit and the actual
number of unduplicated individuals
enrolled in State plan HCBS in the
previous year.
(ii) Access to services. The State must
grant access to all State plan HCBS
assessed to be needed in accordance
with a service plan consistent with
§ 441.725, to individuals who have been
determined to be eligible for the State
plan HCBS benefit, subject to the
following requirements:
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(A) A State must determine that
provided services meet medical
necessity criteria.
(B) A State may limit access to
services through targeting criteria
established by § 441.710(e)(2).
(C) A State may not limit access to
services based upon the income of
eligible individuals, the cost of services,
or the individual’s location in the State.
(iii) Appeals. A State must provide
individuals with advance notice of and
the right to appeal terminations,
suspensions, or reductions of Medicaid
eligibility or covered services as
described in part 431, subpart E.
(2) Administration.
(i) Option for presumptive payment.
(A) The State may provide for a
period of presumptive payment, not to
exceed 60 days, for Medicaid eligible
individuals the State has reason to
believe may be eligible for the State plan
HCBS benefit. FFP is available for both
services that meet the definition of
medical assistance and necessary
administrative expenditures for
evaluation of eligibility for the State
plan HCBS benefit under § 441.715(d)
and assessment of need for specific
HCBS under § 441.720(a), prior to an
individual’s receipt of State plan HCBS
or determination of ineligibility for the
benefit.
(B) If an individual the State has
reason to believe may be eligible for the
State plan HCBS benefit is evaluated
and assessed under the presumptive
payment option and found not to be
eligible for the benefit, FFP is available
for services that meet the definition of
medical assistance and necessary
administrative expenditures. The
individual so determined will not be
considered to have enrolled in the State
plan HCBS benefit for purposes of
determining the annual number of
participants in the benefit.
(ii) Option for Phase-in of Services
and Eligibility
(A) In the event that a State elects to
establish targeting criteria through
§ 441.710(e)(2), the State may limit the
enrollment of individuals or the
provision services to enrolled
individuals based upon criteria
described in a phase-in plan, subject to
CMS approval. A State which elects to
target the State plan HCBS benefit and
to phase-in enrollment and/or services
must submit a phase-in plan for
approval by CMS that describes, at a
minimum:
(1) The criteria used to limit
enrollment or service delivery.
(2) The rationale for phasing-in
services and/or eligibility.
(3) Timelines and benchmarks to
ensure that the benefit is available
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statewide to all eligible individuals
within the initial 5-year approval.
(B) If a State elects to phase-in the
enrollment of individuals based on
highest need, the phase-in plan must
use the needs-based criteria described in
§ 441.715(a) to establish priority for
enrollment. Such criteria must be based
upon the assessed need of individuals,
with higher-need individuals receiving
services prior to individuals with lower
assessed need.
(C) If a State elects to phase-in the
provision of any services, the phase-in
plan must include a description of the
services that will not be available to all
eligible individuals, the rationale for
limiting the provision of services, and
assurance that all individuals with
access to a willing and qualified
provider may receive services.
(D) The plan may not include a cap
on the number of enrollees.
(E) The plan must include a timeline
to assure that all eligible individuals
receive all included services prior to the
end of the first 5-year approval period,
described in paragraph (a)(2)(vi) of this
section.
(iii) Reimbursement methodology.
The State plan amendment to provide
State plan HCBS must contain a
description of the reimbursement
methodology for each covered service,
in accordance with CMS sub-regulatory
guidance. To the extent that the
reimbursement methodologies for any
self-directed services differ from those
descriptions, the method for setting
reimbursement methodology for the
self-directed services must also be
described.
(iv) Operation. The State plan
amendment to provide State plan HCBS
must contain a description of the State
Medicaid agency line of authority for
operating the State plan HCBS benefit,
including distribution of functions to
other entities.
(v) Modifications. The agency may
request that modifications to the benefit
be made effective retroactive to the first
day of a fiscal year quarter, or another
date after the first day of a fiscal year
quarter, in which the amendment is
submitted, unless the amendment
involves substantive change.
Substantive changes may include, but
are not limited to, the following:
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(A) Revisions to services available
under the benefit including elimination
or reduction in services, and changes in
the scope, amount and duration of the
services.
(B) Changes in the qualifications of
service providers, rate methodology, or
the eligible population.
(1) Request for Amendments. A
request for an amendment that involves
a substantive change as determined by
CMS—
(i) May only take effect on or after the
date when the amendment is approved
by CMS; and
(ii) Must be accompanied by
information on how the State will
ensure for transitions with minimal
adverse impact on individuals impacted
by the change.
(2) [Reserved]
(vi) Periods of approval.
(A) If a State elects to establish
targeting criteria through
§ 441.710(e)(2)(i), the approval of the
State Plan Amendment will be in effect
for a period of 5 years from the effective
date of the amendment. To renew State
plan HCBS for an additional 5-year
period, the State must provide a written
request for renewal to CMS at least 180
days prior to the end of the approval
period. CMS approval of a renewal
request is contingent upon State
adherence to Federal requirements and
the state meeting its objectives with
respect to quality improvement and
beneficiary outcomes.
(B) If a State does not elect to
establish targeting criteria through
§ 441.710(e)(2)(i), the limitations on
length of approval does not apply.
(b) Quality improvement strategy:
Program performance and quality of
care. States must develop and
implement an HCBS quality
improvement strategy that includes a
continuous improvement process and
measures of program performance and
experience of care. The strategy must be
proportionate to the scope of services in
the State plan HCBS benefit and the
number of individuals to be served. The
State will make this information
available to CMS at a frequency
determined by the Secretary or upon
request.
(1) Quality Improvement Strategy. The
quality improvement strategy must
include all of the following:
PO 00000
Frm 00093
Fmt 4701
Sfmt 9990
3039
(i) Incorporate a continuous quality
improvement process that includes
monitoring, remediation, and quality
improvement.
(ii) Be evidence-based, and include
outcome measures for program
performance, quality of care, and
individual experience as determined by
the Secretary.
(iii) Provide evidence of the
establishment of sufficient
infrastructure to implement the program
effectively.
(iv) Measure individual outcomes
associated with the receipt of HCBS,
related to the implementation of goals
included in the individual service plan.
(2) [Reserved]
PART 447—PAYMENTS FOR
SERVICES
19. The authority citation for part 447
continues to read as follows:
■
Authority: Sec. 1102 of the Social Security
Act (42 U.S.C. 1302).
20. Section 447.10 is amended by
adding new paragraph (g)(4) to read as
follows:
■
§ 447.10 Prohibition against reassignment
of provider claims.
*
*
*
*
*
(g) * * *
(4) In the case of a class of
practitioners for which the Medicaid
program is the primary source of service
revenue, payment may be made to a
third party on behalf of the individual
practitioner for benefits such as health
insurance, skills training and other
benefits customary for employees.
*
*
*
*
*
Authority: (Catalog of Federal Domestic
Assistance Program No. 93.778, Medical
Assistance Program)
Dated: September 18, 2013.
Marilyn Tavenner,
Administrator, Centers for Medicare &
Medicaid Services.
Approved: December 9, 2013.
Kathleen Sebelius,
Secretary, Department of Health and Human
Services.
[FR Doc. 2014–00487 Filed 1–10–14; 11:15 am]
BILLING CODE 4120–01–P
E:\FR\FM\16JAR2.SGM
16JAR2
]]>Agencies
[Federal Register Volume 79, Number 11 (Thursday, January 16, 2014)]
[Rules and Regulations]
[Pages 2947-3039]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-00487]
[[Page 2947]]
Vol. 79
Thursday,
No. 11
January 16, 2014
Part II
Department of Health and Human Services
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Centers for Medicare and Medicaid Services
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42 CFR Part 430, 431 et al.
Medicaid Program; State Plan Home and Community-Based Services, 5-Year
Period for Waivers, Provider Payment Reassignment, and Home and
Community-Based Setting Requirements for Community First Choice and
Home and Community-Based Services (HCBS) Waivers; Final Rule
Federal Register / Vol. 79 , No. 11 / Thursday, January 16, 2014 /
Rules and Regulations
[[Page 2948]]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
42 CFR Parts 430, 431, 435, 436, 440, 441 and 447
[CMS-2249-F; CMS-2296-F]
RIN 0938-AO53; 0938-AP61
Medicaid Program; State Plan Home and Community-Based Services,
5-Year Period for Waivers, Provider Payment Reassignment, and Home and
Community-Based Setting Requirements for Community First Choice and
Home and Community-Based Services (HCBS) Waivers
AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This final rule amends the Medicaid regulations to define and
describe state plan section 1915(i) home and community-based services
(HCBS) under the Social Security Act (the Act) amended by the
Affordable Care Act. This rule offers states new flexibilities in
providing necessary and appropriate services to elderly and disabled
populations. This rule describes Medicaid coverage of the optional
state plan benefit to furnish home and community based-services and
draw federal matching funds.
This rule also provides for a 5-year duration for certain
demonstration projects or waivers at the discretion of the Secretary,
when they provide medical assistance for individuals dually eligible
for Medicaid and Medicare benefits, includes payment reassignment
provisions because state Medicaid programs often operate as the primary
or only payer for the class of practitioners that includes HCBS
providers, and amends Medicaid regulations to provide home and
community-based setting requirements related to the Affordable Care Act
for Community First Choice State plan option. This final rule also
makes several important changes to the regulations implementing
Medicaid 1915(c) HCBS waivers.
DATES: Effective Date: These regulations are effective on March 17,
2014.
FOR FURTHER INFORMATION CONTACT: Kathy Poisal, (410)786-5940.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Executive Summary
II. State Plan Home and Community-Based Services, 5-Year Period for
Waivers, Provider Payment Reassignment, and Home and Community-Based
Setting Requirements for Community First Choice
A. Background
B. Provisions of the Proposed Regulations and Analysis of and
Responses to Public Comments
1. 5-Year Period for Certain Demonstration Projects and Waivers
(part 430)
2. State Organization and General Administration (part 431)
3. Eligibility in the States, District of Columbia, the Northern
Mariana Islands, and American Samoa (part 435) and Eligibility in
Guam, Puerto Rico and the Virgin Islands (part 436)
4. Services: General Provisions (part 440)
5. State Plan Home and Community-based Services under section
1915(i)(1) of the Act (Sec. 441.710) and Community First Choice
State Plan Option: Home and Community-Based Setting Requirements
(Sec. 441.530)
6. Needs-based Criteria and Evaluation (Sec. 441.715)
7. Independent assessment (Sec. 441.720)
8. Person-Centered Service plan (Sec. 441.725)
9. Provider qualifications (Sec. 441.730)
10. Definition of Individual's Representative (Sec. 441.735)
11. Self-directed Services (Sec. 441.740)
12. State Plan HCBS Administration: State Responsibilities and
Quality Improvement (Sec. 441.745)
13. Prohibition Against Reassignment of Provider Claims (Sec.
447.10)
III. Home and Community-Based Services (HCBS) Waivers (Section
1915(c) of the Act)
A. Background
B. Provisions of the Proposed Regulations and Analysis of and
Responses to Public Comments
1. Contents of request for a waiver (Sec. 441.301)
2. State Assurances (Sec. 441.302)
3. Duration, extension, and amendment of a waiver (Sec.
441.304)
IV. Provisions of the Final Regulations
V. Collection of Information Requirements
VI. Regulatory Impact Analysis
VII. Regulatory Flexibility Act Analysis
VIII. Unfunded Mandates Reform Act Analysis
IX. Federalism Analysis
Regulation Text
Acronyms
Because of the many terms to which we refer by acronym in this
final rule, we are listing the acronyms used and their corresponding
terms in alphabetical order below.
ADA Americans with Disabilities Act of 1990 (Pub. L. 110-325)
ADLs Activities of daily living
AHRQ Agency for Healthcare Research and Quality
ANPRM Advance Notice of Proposed Rulemaking
CFC Community First Choice (1915(k) State plan Option)
CHIPRA Children's Health Insurance Program Reauthorization of 2009
(Pub. L. 111-3)
CMS Centers for Medicare & Medicaid Services
DRA Deficit Reduction Act of 2005 (Pub. L. 109-171)
EPSDT Early and Periodic Screening, Diagnosis and Treatment
FBR Federal benefit rate
FFP Federal financial participation
FPL Federal poverty line
FY Federal fiscal year
HCB Home and community based
HCBS Home and Community-Based Services
HHS Department of Health and Human Services
IADLs Instrumental activities of daily living
ICF/IID Intermediate care facility for individuals with intellectual
disabilities
LOC Level of care
NF Nursing facility
OBRA`81 Omnibus Budget Reconciliation Act of 1981 (Pub. L. 97-35)
OT Occupational therapy
PT Physical therapy
RFA Regulatory Flexibility Act
SPA State Plan Amendments
SSI Supplemental Security Income
SSI/FBR Supplemental Security Income Federal Benefit Rate
UPL Upper payment limit
I. Executive Summary
A. Purpose
This final rule amends Medicaid regulations consistent with the
requirements of section 2601 of the Patient Protection and Affordable
Care Act of 2010 (Affordable Care Act), which added section 1915(h)(2)
to the Act to provide authority for a 5-year duration for certain
demonstration projects or waivers under sections 1115, 1915(b), (c), or
(d) of the Act, at the discretion of the Secretary, when they provide
medical assistance to individuals who are dually eligible for both
Medicaid and Medicare benefits.
This final rule also provides additional limited exception to the
general requirement that payment for services under a state plan must
be made directly to the individual practitioner providing a service
when the Medicaid program is the primary source of reimbursement for a
class of individual practitioners. This exception will allow payments
to be made to other parties to benefit the providers by ensuring
workforce stability, health and welfare, and trainings, and provide
added flexibility to the state. We are including the payment
reassignment provision, because states' Medicaid programs often operate
as the primary or only payer for the class of practitioners that
includes HCBS providers.
In addition, this final rule also amends Medicaid regulations to
provide home and community-based setting requirements related to
section 2401 of the Affordable Care Act for section
[[Page 2949]]
1915(k) of the Act, the Community First Choice State plan option.
This final rule further amends the Medicaid regulations to define
and describe state plan home and community-based services (HCBS). This
regulation outlines the optional state plan benefit to furnish home and
community-based state plan services and draw federal matching funds. As
a result, states will be able to design and tailor Medicaid services to
better accommodate individual needs. This may result in improved
patient outcomes and satisfaction, while enabling states to effectively
manage their Medicaid resources.
This final rule also revises the regulations implementing Medicaid
home and community-based services (HCBS) waivers under section 1915(c)
of the Social Security Act (the Act) by providing states the option to
combine the existing three waiver targeting groups identified in Sec.
441.301. In addition, this final rule will include other changes to the
HCBS waiver provisions to convey expectations regarding person-centered
plans of care, to provide characteristics of settings that are home and
community-based as well as settings that may not be home and community-
based, to clarify the timing of amendments and public input
requirements when states propose modifications to HCBS waiver programs
and service rates, and to describe the additional strategies available
to CMS to ensure state compliance with the statutory provisions of
section 1915(c) of the Act. The final rule also includes requirements
for person-centered plans of care that document, among other things, an
individual's choice of a HCB setting from among options that meet the
individual's needs.
B. Summary of the Major Provisions
1. State Plan Home Community-Based Services (Section 1915(i) of the
Act)
The Deficit Reduction Act (DRA) added a new provision to the
Medicaid statute entitled ``Expanded Access to Home and Community-Based
Services for the Elderly and Disabled.'' This provision allows states
to provide HCBS (as an optional program) under their state Medicaid
plans. This option allows states to receive federal financial
participation for services that were previously eligible for federal
funds only under waiver or demonstration projects. This provision was
further amended by the Affordable Care Act. The statute now provides
additional options for states to design and implement HCBS under the
Medicaid state plan. In the April 4, 2008, Federal Register, (73 FR
18676) we published a proposed rule to amend Medicaid regulations to
implement HCBS under the DRA. That proposed rule was not finalized, and
with the passage of section 2402 of the Affordable Care Act, some
previously proposed regulations would no longer be in compliance with
the current law under section 1915(i) of the Act. In addition, several
new provisions were added. Specifically, the Affordable Care Act
amended the statute by adding a new optional categorical eligibility
group for individuals to provide full Medicaid benefits to certain
individuals who will be receiving HCBS. It also authorized states to
elect not to comply with section 1902(a)(10)(B) of the Act pertaining
to comparability of Medicaid services. After closely analyzing the
Affordable Care Act provisions, we concluded that a new proposed rule
was necessary. This final rule also establishes home and community-
based setting requirements. We will allow states a transition/phase-in
period for current approved 1915(i) State plan HCBS to demonstrate
compliance with these requirements.
2. 5-Year Period for Certain Demonstration Projects and Waivers
This final rule provides for a 5-year approval or renewal period,
subject to the discretion of the Secretary, for certain Medicaid
waivers. Specifically, this time period applies for demonstration and
waiver programs through which a state serves individuals who are dually
eligible for both Medicare and Medicaid benefits.
3. Provider Payment Reassignments
Section 1902(a)(32) of the Act provides that state plans can allow
payments to be made only to certain individuals or entities.
Specifically, payment may only be made to an individual practitioner
who provided the service. The statute provides several specific
exceptions to the general principle of direct payment to the individual
practitioner.
Over the years, some states have requested that we consider
adopting additional exceptions to the direct payment principle to
permit withholding from the payment due to the individual practitioner
for amounts paid by the state directly to third parties for health and
welfare benefits, training costs and other benefits customary for
employees. These amounts would not be retained by the state, but would
be remitted to third parties on behalf of the practitioner for the
stated purpose.
While the statute does not expressly provide for additional
exceptions to the direct payment principle, we believe the
circumstances at issue were not contemplated under the statute.
Therefore, we proposed that the direct payment principle should not
apply because we think its application would contravene the fundamental
purpose of this provision. The apparent purpose of the direct payment
principle was to prohibit factoring arrangements, and not to preclude a
Medicaid program that is functioning as the practitioner's primary
source of revenue from fulfilling the basic responsibilities that are
associated with that role. Therefore, we proposed an additional
exception to describe payments that we do not see as within the
intended scope of the statutory direct payment requirement, that would
allow the state to claim as a provider payment amounts that are not
directly paid to the provider, but are withheld and remitted to a third
party on behalf of the provider for health and welfare benefit
contributions, training costs, and other benefits customary for
employees.
4. Community First Choice State Plan Option: Home and Community-Based
Setting Requirements (Section 1915(k) of the Act)
Section 1915(k)(1)(A)(ii) of the Act provides that home and
community-based attendant services and supports must be provided in a
home and community-based setting. The statute specifies that home and
community-based settings do not include a nursing facility, institution
for mental diseases, or an intermediate care facility for individuals
with intellectual disabilities. We have adopted this statutory language
in our regulations. Additionally, to provide greater clarity, we have
established that home and community-based settings must exhibit
specific qualities to be eligible sites for delivery of home and
community-based services.
After consideration of comments received in response to the
Community First Choice (CFC) proposed rule published in the Federal
Register (76 FR 10736) on February 25, 2011, we decided to revise the
setting provision and publish our proposed definition as a new proposed
rule to allow for additional public comment before this final rule. The
public comment process has been valuable in assisting us to develop the
best policy on this issue for Medicaid beneficiaries. We have fully
considered all comments received, and have aligned the requirements
pertaining to home and community-based settings across CFC, section
1915(i) State plan HCBS, and section 1915(c) of the Act HCBS waivers.
[[Page 2950]]
5. Home and Community Based Services Waivers (Section 1915(c) of the
Act)
Section 1915(c) of the Act authorizes the Secretary of Health and
Human Services to waive certain Medicaid statutory requirements so that
a state may offer Home and Community-Based Services (HCBS) to state-
specified group(s) of Medicaid beneficiaries who otherwise would
require services at an institutional level of care. This final rule
will give states the option to combine the existing three waiver
targeting groups as identified in Sec. 441.301. In addition, it will
implement requirements regarding person-centered service plans, clarify
the timing of amendments when states modify HCBS waiver programs and
service rates, and describe the additional strategies available to us
to ensure state compliance with the provisions of section 1915(c) of
the Act. This final rule also establishes home and community-based
setting requirements. We will allow states a transition/phase-in period
for current approved 1915(c) HCBS waivers to demonstrate compliance
with these requirements.
C. Summary of Costs, Benefits and Transfers
----------------------------------------------------------------------------------------------------------------
Provision description Total costs Total benefits Total transfers
----------------------------------------------------------------------------------------------------------------
1915(i) State Plan Home Community- The estimated total We anticipate that states We estimate that,
Based Services. annual collection of will make varying use of adjusted for a
information the state plan HCBS phase[dash]in period
requirements cost to benefit provisions to during which states
states is $21,805.. provide needed long-term gradually elect to offer
care services for the state plan HCBS
Medicaid beneficiaries. benefit, in FY 2014 the
These services will be federal cost would be
provided in the home or $150 million, and the
alternative living estimated state cost
arrangements in the would be $115million.
community, which is of (Some portion of these
benefit to the impacts would actually
beneficiary, and is less be societal costs rather
costly than institutional than ``transfers'', to
care.. the extent that new
users of the HCBS in
this rule are previously
not receiving services.)
Section 2601 of the Affordable N/A.................. As this provision No impact on federal or
Care Act: 5-Year Period for elongates the time period state Medicaid funding.
Demonstration Projects (Waivers). under which states may This rule is voluntary
operate certain waiver on the part of states.
programs without renewal,
it will help states to
minimize administrative
and renewal requirements
in order to better focus
on program implementation
and quality oversight..
Provider Payment Reassignments.... N/A.................. This rule implements We do not anticipate any
additional operational impact on federal
flexibilities for states Medicaid funding. This
to help ensure a strong rule is voluntary on the
provider workforce.. part of states.
Section 2401 of the Affordable N/A.................. This rule provides states We do not anticipate
Care Act: Community First Choice with necessary guidance there is an impact on
State Plan Option: Home and to support compliance federal or state
Community-Based Setting with the requirement that Medicaid funding, as the
Requirements. CFC services are provided purpose of the rule is
in a home or community merely to define home
based-setting. This rule and community-based
also provides beneficiary settings in which CFC
protections to support an services may be
individual's choice to provided.
receive HCBS in a manner
that allows for
integration with the
greater community..
1915(c) Home and Community-Based States may incur These changes will support We do not anticipate any
Services Waivers. costs in coming into beneficiaries by enabling impact on federal
compliance with this services to be planned Medicaid funding.
rule. Given the and delivered in a manner
variability in state driven by the beneficiary
programs, and the and will maximize
varying extent to opportunities for
which some are beneficiaries to have
already complying, access to the benefits of
it is difficult to community living and
estimate these receive services in the
costs.. most integrated setting.
These changes will also
enable states to realize
administrative and
program design
simplification and
improve efficiency of
operation..
----------------------------------------------------------------------------------------------------------------
II. State Plan Home and Community-Based Services, 5-Year Period for
Waivers, Provider Payment Reassignment, and Home and Community-Based
Setting Requirements for Community First Choice
A. Background
On February 8, 2006, the Deficit Reduction Act (DRA) of 2005 (Pub.
L. 109-171) was signed into law. Section 6086 of the DRA is entitled
``Expanded Access to Home and Community-Based Services for the Elderly
and Disabled.'' Section 6086(a) of the DRA adds a new section 1915(i)
to the Act that allows states, at their option, to provide home and
community-based services (HCBS) under their regular state Medicaid
plans. This option allows states to receive federal financial
participation (FFP) for services that were previously eligible for the
funds only under waiver or demonstration projects, including those
under sections 1915(c) and 1115 of the Act. Section 1915(i) of the Act
was later amended by sections 2402(b) through (g) of the Patient
Protection and Affordable Care Act of 2010 (Pub. L. 111-148, enacted
March 23, 2010) (Affordable Care Act) to provide additional options for
states to design and implement HCBS under the Medicaid state plan.
In the following discussion of this regulation, we refer to
particular home and community-based service(s) offered under section
1915(i) of the Act as ``State plan HCBS'' or simply ``HCBS'' \1\. We
refer to the ``State plan HCBS benefit'' when describing the collective
requirements of section 1915(i) of the Act that apply to states
electing to provide one, or several, of the authorized HCBS. We choose
to use the
[[Page 2951]]
term ``benefit'' rather than ``program'' to describe section 1915(i) of
the Act to avoid possible confusion with section 1915(c) HCBS waiver
programs. The State plan HCBS benefit shares many features with section
1915(c) waiver programs, but it is a state plan benefit, although one
with very unique features not common to traditional state plan
services.
---------------------------------------------------------------------------
\1\ Note that the abbreviation HCBS does not distinguish between
singular and plural. Where this could be confusing, we spell out
home and community-based service(s).
---------------------------------------------------------------------------
Under section 1915(i) of the Act, states can provide HCBS to
individuals who require less than institutional level of care (LOC) and
who would, therefore, not be eligible for HCBS under section 1915(c)
waivers, in addition to serving individuals who have needs that would
meet entry requirements for an institution. As with other state plan
services, the benefits must be provided statewide, and states must not
limit the number of eligible people served.
Section 1915(i) of the Act explicitly provides that State plan HCBS
may be provided without determining that, but for the provision of
these services, individuals would require the LOC provided in a
hospital, a nursing facility (NF), or an intermediate care facility for
individuals with intellectual disabilities \2\ (ICF/IID) as is required
in section 1915(c) HCBS waivers. While HCBS provided through section
1915(c) waivers must be ``cost-neutral'', as compared to institutional
services, no cost neutrality requirement applies to the section 1915(i)
State plan HCBS benefit. States are not required to produce comparative
cost estimates of institutional care and the State plan HCBS benefit.
This significant distinction allows states to offer HCBS to individuals
whose needs are substantial, but not severe enough to qualify them for
institutional or waiver services, and to individuals for whom there is
not an offset for cost savings in NFs, ICFs/MR, or hospitals.
---------------------------------------------------------------------------
\2\ While the Social Security Act still refers to these types of
facilities as intermediate care facilities for the mentally retarded
(ICFs/MR), the language used in this rule reflects ``intellectual
disability'' as the appropriate way to discuss this type of
disability, based on Rosa's Law and we now refer to this types of
facility as an intermediate care facility for individuals with
intellectual disabilities (ICF/IID).
---------------------------------------------------------------------------
To be eligible for the State plan HCBS benefit, an individual must
be included in an eligibility group that is contained in the state
plan, including if the state elects, the new eligibility group defined
at section 1902(a)(10)(A)(ii)(XXII) of the Act. Each individual must
meet all financial and non-financial criteria set forth in the plan for
the applicable eligibility group.
HCBS benefits that are not otherwise available through section
1905(a) of the Act state plan services under the Medicaid Early and
Periodic Screening, Diagnostic, and Treatment (EPSDT) benefit may be
furnished to Medicaid eligible children who meet the State plan HCBS
needs-based eligibility criteria, and who meet the state's medical
necessity criteria for the receipt of services. In addition to meeting
EPSDT requirements through the provision of 1905(a) services, a state
may also meet, in part, a particular child's needs under EPSDT through
services that are also available through the 1915(i) benefit. However,
all Medicaid-eligible children must have full access to services
required under EPSDT, and the provision of 1915(i) State plan HCBS
should in no way hinder their access to such services.
Section 1915(i)(1)(H)(i) of the Act requires the state to ensure
that the State plan HCBS benefit meets federal and state guidelines for
quality assurance, which we interpret as assurances of quality
improvement. Consistent with current trends in health care, the
language of quality assurance has evolved to mean quality improvement,
a systems approach designed to continuously improve services and
support and prevent or minimize problems prior to occurrences.
Guidelines for quality improvement have been made available through CMS
policies governing section 1915(c) HCBS waivers available at
www.hcbswaivers.net and published manuscripts available at
www.nationalqualityenterprise.com.
Section 1915(i) provides states the option to provide home and
community-based services, but does not define ``home and community-
based.'' Along with our overarching goal to improve Medicaid HCBS, we
seek to ensure that Medicaid is supporting needed strategies for states
in their efforts to meet their obligations under the ADA and the
Supreme Court decision in Olmstead v. L.C., 527 U.S. 581 (1999). In the
Olmstead decision, the Court affirmed a state's obligations to provide
covered program services to eligible individuals with disabilities in
the most integrated setting appropriate to their needs. A state's
obligations under the ADA and section 504 of the Rehabilitation Act are
not defined by, or limited to, the services provided under the State's
Medicaid program. However, the Medicaid program can support compliance
with the ADA, section 504 of the Rehabilitation Act, and Olmstead
through the provision of Medicaid services to Medicaid-eligible
individuals in integrated settings.
We noted in the May 3, 2012 proposed rule published in the Federal
Register (77 FR 26362), that home and community-based settings do not
include nursing facilities, institutions for mental diseases,
intermediate care facilities for the mentally retarded, hospitals, or
any other locations that have the qualities of an institutional setting
as determined by the Secretary.
While HCBS are not available while an individual resides in an
institution, HCBS may be available to assist individuals to transition
from an institution to the community. Recognizing that individuals
leaving institutions require assistance to establish themselves in the
community, we would allow states to include in a section 1915(i)
benefit, as an ``other'' service, certain transition services to be
offered to individuals to assist them in their transition to the
community. We proposed that community transition services could be
commenced prior to discharge and could be used to assist individuals
during the period of transition from an institutional residence.
Additionally, services could be provided to assist individuals
transitioning to independent living in the community, as described in a
letter to the State Medicaid Directors on May 9, 2002 (SMDL
02-008). We further recognize that, for short hospital stays,
an individual may benefit from ongoing support through the State plan
HCBS benefit to meet needs not met through the provision of hospital
services that are identified in the individual's person-centered
service plan, to ensure smooth transitions between acute care settings
and home and community-based settings, and to preserve the individual's
functions. Importantly, these services must be exclusively for the
benefit of the individual, not the hospital, and must not substitute
for services that the hospital is obligated to provide through its
conditions of participation or under federal or state laws. However,
payments for room and board are expressly prohibited by section
1915(i)(1) of the Act, except for respite care furnished in a setting
approved by the state that is not the individual's residence.
Section 2601 of the Affordable Care Act adds a new paragraph to
section 1915(h) of the Act to permit the Secretary, at her discretion,
to approve a waiver that provides medical assistance for individuals
dually eligible for Medicare and Medicaid (``dual eligibles'') for an
initial period of up to 5 years and renewed for up to 5 years, at the
state's request. The statute defines a dual eligible as: ``an
individual who is entitled to, or enrolled for, benefits under part A
of title XVIII, or enrolled for benefits under part B of title XVIII,
and is eligible for medical assistance
[[Page 2952]]
under the state plan under this title or under a waiver of such plan.''
This new authority enhances existing tools available to improve and
coordinate care and services for this particularly vulnerable group of
beneficiaries. This change provides an important tool for states to
design programs to better coordinate services for dual eligible
individuals.
Section 1902(a)(32) of the Act generally states that ``no payment
under the plan for care and services provided to an individual shall be
made to anyone other than such individual or the person or institution
providing such care or service, under an assignment or power of
attorney or otherwise.'' However, section 1902(a)(32) of the Act
contains several specific exceptions to the general principle of direct
payment to individual practitioners. There are exceptions for payments
for practitioner services where payment is made to the employer of the
practitioner, and the practitioner is required as a condition of
employment to turn over fees to the employer; payments for practitioner
services furnished in a facility when there is a contractual
arrangement under which the facility bills on behalf of the
practitioner; reassignments to a governmental agency, through a court
order, or to a billing agent; payments to a practitioner whose patients
were temporarily served by another identified practitioner; or payments
for a childhood vaccine administered before October 1, 1994.
Section 1915(k)(1)(A)(ii) of the Act provides that home and
community-based attendant services and supports must be provided in a
home and community-based setting. The statute specifies that home and
community-based settings do not include a nursing facility, institution
for mental diseases, or an intermediate care facility for the mentally
retarded.\3\ We are aware of settings other than those specified in
section 1915(k)(1)(A)(ii) of the Act that may exhibit qualities of an
institutional setting, such as public hospitals. Over the past several
years, we have sought input on how to define the characteristics of
what makes a setting ``home and community-based'' (HCB). To provide
greater clarity, we are establishing with this final rule that home and
community-based settings must exhibit specific qualities to be eligible
sites for delivery of HCBS under Medicaid. Any modifications to these
qualities must be justified in an individual's person-centered plan,
and we believe this gives states the flexibility to address specific
needs of beneficiaries. We have included these provisions to move
toward a stronger articulation of the qualities that make a setting a
home and truly integrated in the broader community. These are the
qualities most often articulated by persons with disabilities as key
determinants of independence and community integration. We believe that
these qualities of home and community-based settings will support the
use of the Medicaid program to maximize the opportunities for
individuals to access the benefits of home and community living. We
expect states electing to provide benefits under section 1915(k),
1915(i), and/or 1915(c) to include a definition of home and community-
based setting that incorporates these qualities and will review all
SPAs and 1915(c) waivers to determine whether they propose settings
that are home or community-based. We will permit states with approved
section 1915(k) SPAs, 1915(i) SPAs, and 1915(c) waivers a reasonable
transition period to come into compliance with the HCB setting
requirements as promulgated in our final rule.
---------------------------------------------------------------------------
\3\ Although we recognize that the language used here is
outdated, and that ``intellectual disability'' is the appropriate
way to discuss this type of disability, the Social Security Act
still refers to these types of facilities in this manner.
---------------------------------------------------------------------------
For a detailed description of the background of this rule, please
refer to ``State Plan Home and Community-Based Services, 5-Year Period
for Waivers, Provider Payment Reassignment, and Setting Requirements
for Community First Choice'' proposed rule published in the May 3, 2012
Federal Register (77 FR 26362).
B. Provisions of the Proposed Regulations and Analysis of and Responses
to Public Comments
On May 3, 2012, we published a proposed rule (77 FR 26362) in the
Federal Register entitled ``Medicaid Program; State Plan Home and
Community-Based Services, 5-Year Period for Waivers, Provider Payment
Reassignment, and Setting Requirements for Community First Choice,''
(hereinafter referred to as ``HCBS proposed rule'') that proposed to
amend the Medicaid regulations to define and describe state plan home
and community-based services (HCBS) under the Affordable Care Act. This
rule offers states new flexibilities in providing necessary and
appropriate services to elderly and disabled populations. The rule also
proposed to amend Medicaid regulations consistent with the requirements
of section 2601 of the Affordable Care Act, which added section
1915(h)(2) to the Act to provide authority for a 5-year duration for
certain demonstration projects or waivers under sections 1115, 1915(b),
(c), or (d) of the Act. In addition, the proposed rule includes payment
reassignment provisions because states' Medicaid programs often operate
as the primary or only payer for the class of practitioners that
includes HCBS providers. Finally, the rule proposed Medicaid
regulations to provide home and community-based setting requirements
related to section 2401 of the Affordable Care Act for the section
1915(k) Community First Choice State plan option.
We received a total of 401 timely comments from state agencies,
advocacy groups, health care providers, employers, health insurers,
health care associations, and the general public. The comments ranged
from general support or opposition to the proposed provisions to very
specific questions or comments regarding the proposed changes. We note
that many expressed overall satisfaction with the benefit as a whole,
in that it offers another opportunity for individuals served through
the Medicaid program to return or remain in the community with family
and friends. A couple stated that this opportunity offers additional
flexibility and will not only provide people the opportunity to live
and thrive where they choose, but also has the potential to save
states' dollars.
After consideration of comments received in response to the
Community First Choice (CFC) proposed rule published in the Federal
Register on February 25, 2011, we revised the setting provision and
published our proposed definition as a new proposed rule to allow for
additional public comment before this final rule. Since CFC and section
1915(i) both pertain to home and community-based services, we have
aligned this CFC proposed language with the section 1915(i) proposed
home and community-based setting requirements also included in this
rule.
Brief summaries of each proposed provision, a summary of public
comments we received (with the exception of specific comments on the
paperwork burden or the economic impact analysis), and our responses to
the comments follow. Comments related to the paperwork burden and the
impact analyses are addressed in the ``Collection of Information
Requirements'' and ``Regulatory Impact Analysis'' sections in this
preamble.
[[Page 2953]]
1. 5-Year Period for Certain Demonstration Projects and Waivers (part
430)
In accordance with section 2601 of the Affordable Care Act, we
proposed a 5-year approval or renewal period, subject to the discretion
of the Secretary, for Medicaid waivers under sections 1915(b), 1915(c),
1915(d) and 1115 of the Act. Specifically, this time period applies for
demonstration and waiver programs through which a state serves
individuals who are dually eligible for both Medicare and Medicaid
benefits. While section 2601 of the Affordable Care Act did not provide
a new type of waiver, it did provide an important opportunity for
states to simplify the operation of existing or future waivers under
current authorities that serve dually eligible individuals, especially
important when states combine waiver authorities that have different
approval periods. The approval of such periods is at the Secretary's
discretion, and determinations will be made regarding applications for
5-year waivers in a manner consistent with the interests of
beneficiaries and the objectives of the Medicaid program. We proposed
that if a demonstration or waiver program does not serve or excludes
dually eligible individuals, the 5-year approval period will not be
available under this authority, and existing approval period
requirements will apply. In addition, we proposed that in order for
coverage-related waivers to be approved for 5 years periods, they must
meet all necessary programmatic, financial, and quality requirements.
Comment: Commenters on this section expressed agreement with this
provision. One also requested that we be mindful of the demonstrations
under the Financial Alignment Initiative for dual eligibles. Another
recommended clarification that this provision would also apply to other
future waiver demonstration requests by states to combine Medicare and
Medicaid funding at the state level for delivering care to Medicare-
Medicaid eligibles.
Response: This provision is available for waivers that serve dually
eligible individuals, under sections 1915(b), 1915(c), 1915(d) and 1115
of the Act, and that meet all necessary programmatic, financial, and
quality requirements.
Comment: One commenter requested that CMS make wise and appropriate
use of this authority. Another commenter recommended that CMS include a
statement in the regulation language like one in the preamble to the
proposed rule that determinations ``be made regarding applications for
5-year waivers in a manner consistent with the interests of
beneficiaries and the objectives of the Medicaid program.'' This
commenter stated that one example would be a waiver that effectively
reduces services for dual eligibles, which should not be approvable as
it would not be consistent with the purposes of Title XIX.
Response: We have added ``and in a manner consistent with interests
of the beneficiaries and the objectives of the Medicaid program'' to
the final regulation. In the event that the state finds a need to make
reductions to its program, the state would have to explain to CMS how
they will account for the interest of individuals before taking such
action.
2. State Organization and General Administration (part 431)
In Sec. 431.54, we proposed to add paragraphs (a)(3) and (h) to
include state plan HCBS as exceptions to comparability and community
income and resource rules. For specific discussion, see the published
May 3, 2012 proposed rule (77 FR 2012 through 10385).
Comment: Commenters requested that we clarify that under section
1915(i)(3) of the Act noncompliance with comparability or community
income and resource rules is optional, not mandatory. Specifically,
they requested that we modify Sec. 431.54 (a)(3) and (h) as follows:
For Sec. 431.54 (a)(3): Section 1915(i) of the Act
provides that if a state may provide, as medical assistance, home and
community-based services under an approved state plan amendment that
meets certain requirements, it may elect to do so without regard to the
requirements of sections 1902(a)(10)(B) and 1902(a)(10)(C)(i)(III) of
the Act, with respect to such services only.
For Sec. 431.54(h): State plan home and community-based
services. If the state so elects, the requirements of Sec. 440.240 of
this chapter related to comparability of services do not apply with
respect to State plan home and community-based services defined in
Sec. 440.182 of this chapter.
Response: We believe that the language in the regulation is clear
and we are finalizing the rule as proposed.
3. Eligibility in the States, District of Columbia, the Northern
Mariana Islands, and American Samoa (part 435) and Eligibility in Guam,
Puerto Rico and the Virgin Islands (part 436)
We received several comments that were in support of the
eligibility policies pertaining to the new eligibility group specified
at Sec. 435.219 and Sec. 436.219. Commenters were pleased that the
regulation offers states flexibility in providing HCBS to elderly and
disabled populations who do not meet an institutional level of care.
Commenters were also pleased that the methodology proposed for the new
eligibility group described at Sec. 435.219(a) & (c) did not have a
resource test and that the income standard for this new eligibility
group is set at 150 percent of the FPL. Comments on eligibility
policies not contained in this rule are not addressed.
Comment: A few commenters believed that the language in the
regulation should be more detailed to better reflect the language in
the preamble.
Response: We do not believe that the regulatory language should be
as detailed as the language in the preamble. The language in the
preamble contains the rationale for the requirements described in the
regulatory language. Therefore, we are not revising the regulatory
language to be as detailed as the preamble. We will be revising the
regulatory language to correct an error which inaccurately indicated
that a State could cover some but not all people described in paragraph
(a) or (b). The response to that comment is addressed separately.
Comment: A few commenters suggested that the regulation at Sec.
435.219(c) should be revised to include a requirement that the
methodology elected by the state can be no more restrictive than the
SSI methodology.
Response: To provide states with flexibility, we are not
prescribing a methodology. We will review the methodology proposed by
the state to determine whether it meets the criteria set forth at Sec.
435.219(c) and Sec. 436.219(c). We believe that the current regulatory
language is in the best interest of the beneficiary.
Comment: One commenter suggested revising the introductory language
in Sec. 435.219 and Sec. 436.219 to make it clearer that a state may
choose to cover persons described in paragraph (a), persons described
in paragraph (b) or both sets of persons. The commenter suggested
deleting the language ``any group or groups of'' because the language
suggests inaccurately that a state might be able to cover some but not
all of the persons described in either of paragraphs (a) or (b) of the
regulation.
Response: We agree with the commenter. The state has the option to
provide Medicaid to individuals described in one or both of the
paragraphs under (a) or (b) of this
[[Page 2954]]
section but cannot cover some but not all of the individuals that may
be eligible under either or both parts of the eligibility group. We are
revising the regulatory language at Sec. 435.219 and Sec. 436.219 by
removing the phrase ``any group or groups of.''
Comment: A few commenters suggested that the language in Sec.
453.219 should be revised to specify that any income methodologies must
be applied to all members of the eligibility group.
Response: The state must use the same income methodology for all
members within the eligibility group. Specifically, if a state elects
to cover Sec. 435.219(a) the income methodology must be the same for
all members determined eligible under Sec. 435.219(a). If the state
elects Sec. 435.219(b) the state must use the same income and resource
methodologies and standards that it uses for the Sec. 435.236 (the
special income level) group. As described in the previous comment,
states have the option to provide Medicaid to individuals described in
one or both of the paragraphs under (a) or (b) of this section.
Comment: One commenter commended CMS for proposing regulations to
implement optional categorical eligibility for Medicaid for individuals
in need of section 1915(i) of the Act services. The commenter believes
that this category has the potential to help secure coverage for
uninsured and underinsured individuals and will provide states with a
useful option to consolidate coverage groups.
Response: The intent of the regulation is to provide eligibility
for more individuals needing State plan HCBS not to consolidate
coverage groups.
Comment: One commenter urged CMS to retain the regulatory language
that requires states to use income standards, which are, ``reasonable,
consistent with the objective of the Medicaid program . . . and in the
best interest of the beneficiary.
Response: We are not changing this regulatory language, which is
specified at Sec. 435.219(c) and Sec. 436.219(c).
4. Services: General Provisions (part 440)
Section 1915(i)(1) of the Act grants states the option to provide,
under the state plan, the services and supports listed in section
1915(c)(4)(B) of the Act governing HCBS waivers. The HCBS may not
include payment for room and board. Eligibility for this option is
based upon several different factors that are either specified by the
statute or that a state may define. These include financial
eligibility, the establishment of needs-based criteria, and the state
option to target the benefit and to offer benefits differing in type,
amount, duration or scope to specific populations. Section 1915(i) of
the Act provides that State plan HCBS may be provided without
determining that, but for the provision of these services, individuals
would require the LOC provided in a hospital, a nursing facility (NF),
or an intermediate care facility for individuals with intellectual
disabilities (ICF/IID) as is required in section 1915(c) HCBS waivers.
While HCBS provided through section 1915(c) waivers must be ``cost-
neutral'' as compared to institutional services, no cost neutrality
requirement applies to the section 1915(i) State plan HCBS benefit.
State plan HCBS are intended to enable individuals to receive needed
services in their own homes, or in alternative living arrangements in
what is collectively termed the ``community'' in this context.
Comment: A few commenters requested that CMS add additional
services to Sec. 440.182. One additional commenter requested that
nursing services be added to the list of services specifically listed
in section 1915(c)(4)(B) of the Act governing HCBS waivers.
Response: The services that section 1915(i)(1) of the Act
authorizes states to include are the services and supports listed in
section 1915(c)(4)(B) of the Act governing HCBS waivers. While we are
unable to expand on this list of services, we note that the ``other
services'' specifically referenced in the statute may include coverage
of services not designated in the list of specific services, and gives
states the flexibility to propose and define other specific services.
Comment: Many commenters requested that CMS add to the regulation
text that ``other services'' can include services that have been, or
could be, approved as ``other services'' under a 1915(c) waiver and to
list specific examples, such as transition services or services for
individuals with traumatic brain injury.
Response: ``Other services'' may include coverage of services not
specifically designated, and states have the flexibility to propose and
define other specific services. We will provide examples of ``other
services'' in future guidance.
Comment: A couple of commenters requested revisions to Sec.
440.182(c) to emphasize that the habilitation services that can be
covered by the state include, but are not limited to, expanded
habilitation services as specified in Sec. 440.180(c).
Response: We have revised Sec. 440.182(c) to add the phrase ``may
include expanded habilitation services'' to specify that states can
choose whether or not to include expanded habilitation services as
defined in Sec. 440.180(c).
Comment: One commenter expressed that the final regulation
regarding home and community-based settings must continue to permit the
full array of home and community-based services, as defined by the
Medicaid HCBS statute and regulations and included in the individual's
person-centered service plan.
Response: We agree and, as in the proposed rule, the final
regulation will continue to convey this flexibility for states.
Comment: Another commenter applauded the flexibility given to
states to not only provide specified HCBS benefits under the state
Plan, but to also provide other services at a state's request with
Secretary approval, and encourages CMS to work with states on an
ongoing basis to educate, train, and support the use of this new state
plan option.
Response: We appreciate this comment and believe that this option
provides states with an opportunity to deliver long-term supports and
services to individuals in need. Since implementation of this benefit,
we have directly and indirectly provided states with technical
assistance in the use of section 1915(i) of the Act, and we are
committed to continuing to offer such assistance to states.
Comment: One commenter stated that CMS should not allow section
1915(i) of the Act to be used to provide instrumental activities of
daily living (IADL) services while an individual is in a general acute
hospital short-term stay, as this would be duplicative to the services
received in the hospital and would be hard to administer without
increased costs to the state.
However, another commenter was supportive of allowing HCBS to
continue, as applicable for people who are temporarily hospitalized,
stating that based on the needs of the individual, there could be a
genuine necessity for HCBS while an individual is hospitalized in a
short-term acute care setting and would not be a duplication of
hospital care services:
``Some individuals may need assistance from their personal care
provider to communicate their needs, medical history, redirect
behaviors, and provide consistent person-directed physical
assistance. Most hospitals do not have adequate, nor trained staff
to provide the level and type of ongoing `personal care' many people
using HCBS
[[Page 2955]]
require. Providing continuation of HCBS while someone is in a
hospital is not letting hospitals avoid their responsibilities, but
rather acknowledging the reality that their focus/responsibility is
on `medical care', while HCBS' focus is on `personal care'.''
Response: We agree with the second commenter and believe that this
should remain an option afforded to the state subject to the conditions
and limitations stated in our rule. To support program integrity,
states are required to perform claims edits or adopt other systematic
approaches that prevent duplicate payment.
Comment: One commenter noted that the inclusion of ``other
services'' including certain transition services can make a significant
difference in addressing chronic homelessness.
Response: We agree.
Comment: One commenter suggested providing FFP for rent and food
expenses reasonably attributed to a related caregiver providing State
plan HCBS, just as CMS proposed in the proposed rule for unrelated
caregivers.
Response: Section 1915(i) of the Act does not include authority
that would allow payment for the costs of rent and food attributable to
a related personal caregiver residing in the same household as the
participant.
Comment: One commenter asked us to clarify if there can be
differences in the amount, scope or duration of services provided under
1915(i) and similarly named services provided in a section 1915(c) HCBS
waiver, and whether rates or rate methodologies could differ. The
commenter also asked whether there could be different provider
qualifications for a covered State plan HCBS benefit and a similar
covered HCBS waiver service.
Response: States are permitted the flexibility to define the
section 1915(i) of the Act services they will include under their
benefit, including the amount, duration, and scope of those services.
If a proposed section 1915(i) service is also available under another
Medicaid authority, states must explain how the section 1915(i)
services would not be provided in duplicate, or incur duplicate
payment. However, we note that while 1915(i) services are not
identified in 1905(a) and are not part of the EPSDT requirement, all
Medicaid-eligible children must have full access to services required
under EPSDT, and the provision of section 1915(i) of the Act State plan
HCBS should in no way hinder their access to such services.
With regard to rate methodologies, while rate determination methods
may vary, payments for Medicaid services must be consistent with the
provision of section 1902(a)(30)(A) of the Act (that is, ``payments are
consistent with efficiency, economy, and quality of care and are
sufficient to enlist enough providers'') and the related federal
regulations at Sec. 447.200 through 205. If the state-established
rates will vary for different providers of a service (including a
service that is also available under a section 1915(c) of the Act
waiver), the state must explain the basis for the variation.
Provider qualifications must be reasonable and appropriate to the
nature of the service, reflect sufficient training, experience and
education to ensure that individuals will receive services in a safe
and effective manner, and not have the effect of limiting the number of
providers by the inclusion of requirements that are unrelated to
quality and effectiveness. If the state-established minimum provider
qualifications will vary for a service that is also available under a
section 1915(c) of the Act waiver, the state must explain the basis for
the variation.
Comment: One commenter requested that CMS amend the language to
ensure that the rule addresses individuals with disabilities across the
lifespan, including children, in order to help states understand that
they can serve children under the special population classification.
They expressed concern that the proposed rule does not explicitly
address children. They also requested that CMS add language to specify
children with physical and sensory disabilities, not just those with
cognitive and behavioral disorders.
Response: Our intention was not to exclude children with
disabilities or any other population as we cited examples in the
preamble to the proposed rules. The regulation text does not cite
specific populations who can receive Medicaid HCBS, nor do we think it
prudent to do so, as it may imply limitations on state flexibility.
Comment: One commenter requested that CMS allow federal financial
payment for room and board costs to be included in payment for State
plan HCBS, in order to make such alternatives viable for individuals
who, without housing assistance, must seek institutional placement.
Response: The statute explicitly excludes coverage of room and
board and our rule cannot override that exclusion.
Comment: For Sec. 440.182(c)(8), which refers to conditions set
forth at Sec. 440.180 for persons with chronic mental illness, one
commenter proposed instead a reference to Sec. 440.180(d)(2).
Response: We agree that this reference is more precise and have
incorporated this revision.
Comment: One commenter expressed support for not including the
phrase ``as cost effective and necessary to avoid
institutionalization,'' which appears in Sec. 440.180(b)(9) to
describe the ``other'' services that might be authorized under section
1915(c) of the Act, in Sec. 440.182(c)(9) pertaining to section
1915(i) of the Act.
Response: We agree that this phrase is not appropriate to include
in Sec. 440.182(c)(9), as State plan HCBS under 1915(i) are not
subject to cost neutrality.
Comment: One commenter indicated that the regulation text should
indicate that services must be furnished to individuals with an
assessed need, and must not be based on available funds.
Response: This is reflected in Sec. 441.725(b) regarding the
person-centered service plan.
Income Eligibility:
Section 1915(i)(1) of the Act requires that in order to receive
State plan HCBS, individuals must be eligible for Medicaid under an
eligibility group covered under the State's Medicaid plan. In
determining whether either of the relevant income requirements
(discussed) is met, the regular rules for determining income
eligibility for the individual's eligibility group apply, including any
less restrictive income rules used by the state for that group under
section 1902(r)(2) of the Act.
Section 2402(b) of the Affordable Care Act added a new option at
section 1915(i)(6) of the Act, to allow states, in addition to
continuing to provide services to individuals described in section
1915(i)(1) of the Act, to provide section 1915(i) of the Act services
to certain individuals who meet the needs-based criteria, who would be
eligible for HCBS under sections 1915(c), (d) or (e) of the Act waivers
or a section 1115 waiver approved for the state, and who have income up
to 300 percent of the Supplemental Security Income Federal Benefit Rate
(SSI/FBR).
Section 2402(d) of the Affordable Care Act also amended section
1902(a)(10)(A)(ii) of the Act by adding a new optional categorically
needy eligibility group specified at section 1902(a)(10)(A)(ii)(XXII)
of the Act to provide full Medicaid benefits to certain individuals who
will be receiving section 1915(i) services. This eligibility group has
two parts, and states can cover individuals under either or both parts
of the group. Under this group, states can elect to cover individuals
who are not otherwise eligible for Medicaid who meet the needs-based
criteria of the section 1915(i) of the Act benefit, have income up to
150 percent of the Federal poverty line (FPL) with no resource test
[[Page 2956]]
and who will receive section 1915(i) of the Act services, or
individuals with income up to 300 percent of the SSI/FBR, who would be
eligible under an existing section 1915(c), (d) or (e) \4\ waiver or
section 1115 waiver approved for the state and who will receive section
1915(i) services. These individuals do not have to be receiving
services under an existing section 1915(c), (d) or (e) waiver or
section 1115 waiver; the individual just has to be determined eligible
for the waiver.
---------------------------------------------------------------------------
\4\ 1915(d) and (e) waivers are State options to provide HCBS to
the elderly and to individuals with disabilities, respectively.
Currently, no State elects to provide services under either of these
authorities.
---------------------------------------------------------------------------
Comment: One commenter indicated that there is not a lot of
difference between 300 percent FBR and 150 percent FPL. In 2012 the
amounts were $2094 versus approximately $1400 per month. The commenter
believes that having two income levels to administer will cause more
work for the states and make explaining the program more confusing. The
commenter recommended that for all 1915(i) services, the income
standard be 300 percent of the SSI/FBR.
Response: The statute does not permit the income standard to be
raised to 300 percent of the SSI/FBR for all individuals receiving
1915(i) services. Electing the new eligibility group specified at Sec.
435.219 and Sec. 436.219 in order to provide state plan HCBS to
individuals who were not previously eligible to receive these services
is strictly a state option. Therefore, if a state believes that the
requirements for this eligibility group are too burdensome, the state
does not have to elect to cover this optional eligibility group.
Comment: One commenter believes that existing financial eligibility
rules should remain in place.
Response: Electing any changes to financial eligibility set forth
in this final rule are strictly a state option.
5. State Plan Home and Community-Based Services Under Section
1915(i)(1) of the Act (Sec. 441.710) (Proposed Sec. 441.656) and
Community First Choice State Plan Option: Home and Community-Based
Setting Requirements (Sec. 441.530)
a. Home and Community-Based Settings Under 1915(i) and 1915(k) of
the Act
To implement the statutory requirement that the benefit be ``home
and community-based,'' we proposed to require in Sec. 441.656(a) that
the individual reside in the home or community, not in an institution,
and that the settings must have qualities of community-based settings
prescribed by the Secretary. We stated our recognition of the need for
a consistent definition of this term across Medicaid HCBS, and our goal
to align the final language pertaining to this topic across the
regulations for sections 1915(i), 1915(k), and 1915(c) of the Act
Medicaid HCBS authorities.
Section 1915(i) of the Act provides states the option to provide
home and community-based services, but does not define ``home and
community-based.'' Along with our overarching interest in making
improvements to Medicaid HCBS, we seek to ensure that Medicaid is
supporting needed strategies for States in their efforts to meet their
obligations under the ADA and the Supreme Court decision in Olmstead v.
L.C., 527 U.S. 581 (1999). We proposed language defining the qualities
and requirements for settings in which section 1915(i) of the Act
services and supports could be provided and sought additional comments
on this issue. Instead of attempting to provide one singular definition
to encompass all settings that are home and community-based, we
described the qualities that apply in determining whether a setting is
community-based. We stated that we would expect states electing to
provide HCBS under section 1915(i) of the Act to include a definition
of home and community-based settings that incorporates these qualities,
and that we would review all SPAs to determine whether they propose
settings that are home and community-based.
In the proposed rule, we stated that we would permit states with
approved section 1915(i) of the Act SPAs a reasonable transition
period, a minimum of one year, to come into compliance with the HCBS
setting requirements that are promulgated in our final rule.
Overall, we received 280 comments in response to the HCB settings
section of the proposed rule regarding 1915(i) State plan HCBS and
1915(k) CFC. Commenters included advocacy organizations, individuals
receiving services, family members, friends and guardians of
individuals receiving services as well as providers, government
entities and the general public. Because we are proposing the same
requirements for home and community-based settings in regulations
implementing 1915(i) and 1915(k), we are discussing comments pertaining
to both in this section. The comments were mixed, with commenters
providing both support and disagreement within subsections of the HCBS
settings provision. A few of the issues that elicited a substantial
number of comments are: qualities, integration, providers, choice,
accessibility and privacy in addition to general comments.
Comment: We received many comments related to this section of the
proposed rule. These comments are reflected as follows:
Many commenters expressed concern about the effect the criteria
will have on existing home and community-based services, and expressed
concern that the proposed rule will eliminate community based-services
that elderly individuals and people with disabilities are currently
receiving. Several commenters suggested eliminating all provisions that
restrict the consumer's freedom of choice regarding the residential
settings in which they can utilize their Medicaid funds, stating that
the qualities and characteristics of home are determined by the
individual.
Some commenters stated that affordable rental options, especially
those in apartment complexes where home maintenance responsibilities
are handled by the landlord, are hard to find or non-existent in some
communities. They indicated that lack of affordable housing is a huge
challenge for people seeking to live in the community while being
supported for severe disabilities, and that many individuals who
experience multiple disabilities need housing that is tailored for
their specific physical needs. These commenters stressed that group
homes that were built and owned by a third party, specifically for the
purpose of serving people with disabilities, would not be available if
they tried to rent on the open market and that ruling out such homes
for HCBS funding imposes further hardship and segregation on the
population in need of HCBS.
One commenter believes the requirements will drive up costs.
Some commenters believe that the changes would effectively
eliminate their freedom to provide their adult child a setting that is
protected from exposure to community members that do not understand the
effect of a community's environment on individuals with disabilities.
One commenter indicated that if adopted, the criteria would have a
significant adverse impact on its ability to continue to serve
individuals with the most significant disabilities in the community.
The language included in the proposed regulation would: (1) Thwart
informed choice by negating or severely restricting longstanding
program options and opportunities to provide services and supports
expressly authorized by the HCBS provisions of
[[Page 2957]]
the Medicaid statute and regulations; and (2) Significantly restrict
state flexibility to respond to identified needs of Medicaid
beneficiaries.
Some commenters stated within the broad disability community,
different groups have different needs and desires and any definition of
home and community-based needs to be broad enough to encompass these
divergent needs and desires with one not outweighing others. They
indicated that it may not be possible to have a single definition to
meet these needs.
One commenter stated that the standards proposed for home and
community-based settings are impractical, overly prescriptive,
inappropriate for persons with cognitive impairments and
neurobehavioral challenges, and cannot be delivered at a rate that
states and taxpayers can afford.
Another commenter disagreed with eliminating congregate care
options and requested CMS clearly state policies which encourage states
to operate a range of services for people with disabilities which
reflect the diversity of their care and that of their families,
including congregate care.
Several commenters disagreed with the notion embedded in the CMS
proposal that ``community based'' can only be defined as a totally
independent setting or small stand-alone group home in an urban or
suburban environment.
We received many comments supporting the proposed criteria. These
indicate that the criteria are a step in the right direction and
support the goal of HCBS to assist individuals to be able to live fully
in the greater community. One of these commenters stated that the
criteria proposed appropriately establish the essential elements of
resident autonomy and person-centered care.
Many commenters stated their belief that the provisions are key to
assisting states with complying with the Olmstead decision. One
recommended that the regulation quote verbatim the conclusion of the
Olmstead decision and that reference to the ``integration mandate'' in
the final regulation restates actual language in the ADA regulations
for instance, ``most integrated setting appropriate to the needs of
qualified individuals with disabilities.''
Another indicated that the requirements appropriately ensure that
individuals have control over their care environment while also making
allowances for serving people with cognitive disabilities. Several
commenters stated that the rule offers appropriate flexibility to
ensure that individuals can remain in the community for as long as
possible.
Many commenters commended CMS for its efforts to promote the rights
of people with disabilities to live in the most integrated setting
possible. They stated that the proposed rule has the potential to
improve the care of many adults and children in the public mental
health and developmental disabilities system.
A few commenters stated that making an institutional setting more
``homelike'' does not mean that it becomes community-based, and that
the intent is to ensure that people with disabilities have more self-
direction and ability to govern and control important components of
their personal living environment.
One commenter stated appreciation and support for criteria that
support individual choice, the ability for a recipient to exercise
control over his or her immediate environment and day to day
activities, and that do not restrict the individual's ability to live
in the community in which his or her residence is located. However, the
commenter is concerned that residency in some of the more creative
congregated living arrangements may be disqualified. The commenter
added that CMS should be as flexible as possible to ensure that these
homes are able to continue to support individuals with disabilities and
illnesses in the least restrictive environment possible.
Response: We appreciate all of the comments submitted. We believe
the requirements we are finalizing are critical to ensure that
individuals have the opportunity to receive services in a manner that
protects individual choice and promotes community integration.
Individuals who are elderly and/or disabled who commented made it clear
that their personal rights should not be curtailed because of where
they live or because there is a need to receive HCBS. It is not the
intent of this rule to prohibit congregate settings from being
considered home and community-based settings. State plan HCBS must be
delivered in a setting that meets the HCB setting requirements as set
forth in this rule (except for HCBS that may be delivered in an
institutional setting, such as institutional respite). Also, since this
authority provides states the opportunity to provide individuals HCBS
and not institutional services, individuals must be living in settings
that comport with the HCB setting requirements as set forth in this
rule. We acknowledge that for some settings, implementing these
requirements will require a change to operational protocol, and perhaps
changes to licensure requirements, but we believe that the requirements
are achievable and provide for reasonable transition time to facilitate
such changes as may be necessary. We are committed to working with
states as they examine their systems and develop plans to bring their
HCBS programs/benefits into compliance.
Comment: One commenter noted that Medicaid reimbursement for room
and board is expressly prohibited, yet the criteria laid out in
Sec. Sec. 441.530 and 441.656(a) are primarily focused on
considerations of what is a beneficiary's room and board choice and
therefore arguably outside CMS' authority to regulate. This commenter
stated that CMS lacks authority to regulate these features of
alternative housing arrangements for which it does not provide
reimbursement and requested that CMS clarify under what authority CMS
can mandate physical structure alternative housing requirements and
whether such authority extends to non-provider controlled alternative
housing arrangements. Other commenters stated that creating an
exhaustive list of potential requirements will be difficult and
suggested that CMS carefully consider the wide range of states'
specific programs over the next year before providing guidance through
a State Medicaid Director letter.
Response: While we do not regulate housing, we are required to
determine whether Medicaid State plans and waivers comply with the
statutes authorizing the provision of medical assistance. In
authorizing HCBS Medicaid expenditures, we must ensure that such
settings are home and community-based.
Comment: We received many comments in response to our request for
input on whether the regulation should be modified to prohibit housing
providers from requiring individuals to receive services from that
provider, or requiring an individual to receive a particular service as
a condition of living or remaining in the setting. Many commenters
believe that housing should not be conditioned upon the acceptance of
services and believe that individuals should have the right to choose
their living environment, as well as their supports and services. Some
commenters expressed concern that such an arrangement is inconsistent
with the requirement that Medicaid beneficiaries have a free choice of
provider. Other commenters believe that if assisted living facilities,
and other congregate settings that bundle housing and services, were
required to separate housing and services, those providers could
maintain their customer base by providing services of a quality that
appeals to individuals, not by taking
[[Page 2958]]
advantage of a captive pool of residents. Others expressed concern that
people would become homeless or institutionalized because the services
they require change, and individuals are not given the opportunity to
age in place. Some commenters believe that individuals should have the
opportunity to make their own decisions about where they live, free of
any coercion. One commenter supporting the restriction acknowledged
that compliance with such a provision would require monumental changes
to certain business models and service delivery systems and that such a
change may be beyond the scope of this regulation. Overall, the
commenters supporting the prohibition believe that individuals with
disabilities deserve choice among livable options and control over the
space they call home. Alternatively, we received comments opposing a
separation of housing services requirement, stating that it is too
restrictive. Some commenters expressed concern that such a requirement
would limit a provider's ability to evict tenants who become a threat
to other tenants and staff or repeatedly refuse a particular service
that would treat their medical condition. Other commenters believe that
while the inclusion of this criterion is important in some settings,
such as an individual's home or apartment, it should not be applied to
settings such as group homes or assisted living residences, where the
provision of services is inherent in the setting. Several commenters
suggested that instead of modifying the regulation to require
separating housing and services, this issue could be handled in a
different manner, such as the use of resident agreements in specific
residential settings or through the person centered planning process.
Commenters believe that this regulation should not preclude reasonable
conditions for residency that are consistent with the rules of the
regulating agency. There is also concern with the effect such
restriction could have on specialized programs, such as those targeted
toward the homeless population. Such programs include residential
services and require individuals to maintain sobriety. Other commenters
expressed concern regarding how such a requirement would be
operationalized in assisted living facilities whose model is to provide
both housing and services. In such settings, multiple service providers
and multiple staff with multiple lines of authority, sorting through
oversight and management issues becomes very complex. A few commenters
suggested that CMS should provide guidance that as a matter of
practice, individuals should not be locked into a particular service
package as a condition of their receipt of housing services. Other
commenters suggest that in arrangements where placement is contingent
on acceptance of a specific program, it should be clearly specified as
part of the person-centered planning process that individuals have been
apprised of all alternatives and that the decision to accept the
placement is free from coercion. The commenter notes that adult care
and assisted living facilities are also guided by state regulations and
in most cases these regulations indicate that residents may not reside
in the facility if they are a threat to themselves or others. The
commenter explains that if a facility fails to ``discharge'' a resident
to a more appropriate environment, the facility may be in conflict with
those state regulations, running the risk of being cited with a
deficiency or endangerment, which can threaten its viability.
Response: Upon consideration of the thoughtful comments submitted,
we are not requiring the separation of the housing provider from the
provider of HCBS. Commenters provided compelling arguments both in
support and against the proposed prohibition. We recognize that the
needs of the individuals receiving HCBS vary greatly. Just as there
should be a variety of service options to meet those needs, there
should be a variety of residential options as well. We agree with
commenters that the issue of choice regarding the provision of services
can be addressed as part of the person-centered planning process and
reflected in the individual's person-centered service plan. States must
ensure that when an individual chooses a home and community based
setting, the individual has made an informed choice among options. In
the event the individual has made an informed choice to reside in a
setting that provides both housing and services, the individual must
acknowledge that he has also chosen that provider to be the service
provider. Our decision not to require the separation of housing and
services in the final rule does not preclude a state from structuring
its service delivery system to promote separation. Nor does it preclude
a provider from allowing for such an arrangement if all parties agree,
and the arrangement does not violate state licensing requirements. At
this time, we do not believe that there should be a federal mandate
requiring such a separation.
Comment: Several commenters requested that Sec. 441.656(a)(1)(vi)
be modified to include a ``right to refuse service'' provision. One
commenter suggested the following modification ``in a provider-owned or
controlled residential setting, that receipt of any particular service
or support either from the provider/owner or other qualified provider
cannot be a condition for living in the unit and that this shall mean
that the owner of the unit cannot terminate occupancy/tenancy of
someone for not agreeing to participate in a particular service.'' A
few commenters suggest that if CMS decides against including a ``right
to refuse service'' provision, then a narrow exception should be
provided, allowing the requirement to be waived only for substance
abuse treatment services, on the grounds that such treatment services
are distinct in character from other forms of service provision focused
on ADLs, IADLs, etc. One commenter believes that while providers should
receive adequate reimbursement for housing and services, the individual
should be protected against restrictive (service utilization)
requirements for tenancy and should maintain the right to elect,
receive or deny services without risk of eviction. Another commenter
indicated that this interpretation could have an effect on residential
settings as some of these settings include a structure in which
individuals are required to participate in treatment (substance use,
for example) as a condition of residing in the unit. Overall, the
commenters believe that individuals should not be forced to move out of
their homes because they do not want a particular service offered by
the provider.
Response: We do not believe that a ``right to refuse'' provision is
necessary as it is a basic tenet of the Medicaid program that
individuals cannot be compelled to receive any Medicaid service.
Additionally, we believe the requirements specified under the person-
centered planning process, and the requirement at Sec.
441.530(a)(1)(iii) and Sec. 441.710(a)(1)(iii) that an individual is
free from coercion and restraint, achieve the same purpose as a ``right
to refuse'' provision. Although Medicaid beneficiaries have the right
to refuse a service, we recognize that depending on the setting, rules
other than those of the Medicaid program may be applicable and may
reflect health and safety concerns related to the refusal of services.
We plan to issue additional guidance on how other components of this
regulation can be useful tools in addressing such concerns.
[[Page 2959]]
Comment: Several commenters recommend that the proposed regulation
be amended to reference the ADA, which generally requires a provider to
accommodate a resident's needs by making necessary services available
to the extent that those accommodations are setting-appropriate and are
not legally prohibited. Commenters believe that this type of
accommodation should be required in a community-based setting, as it
values the individual's interest in staying in the home over the
facility's interest in limiting the care needs that must be met.
Response: The requirements of this rule do not replace or override
the requirements of the ADA. There are already a few general provisions
in our regulations that prohibit discrimination in State Medicaid
programs on the basis of nationality, disability, etc., (Sec. 430.2,
Sec. 435.901, Sec. 435.905, and Sec. 435.908). As these regulations
apply in determining eligibility and administering the Medicaid program
generally, it is not necessary to add a regulation on this subject
specific to section 1915(i) of the Act.
Comment: One commenter suggested that clear contracts and
boundaries need to be defined in order to recognize that no matter the
setting, that location is the individual's home.
Response: We agree with the commenter that regardless of the type
of setting, the location is the person's home.
Comment: One commenter suggested CMS include the concept of ``aging
in place,'' as defined by the Center for Disease Control. The commenter
believes that regardless of whether or not the setting is provider-
owned or controlled, individuals should be protected by a reasonable
accommodation requirement in their current settings as their needs
change in order to prevent individuals from being evicted or losing
their home. The commenter further suggests that individuals should also
have access to an appeals process through an objective third party to
dispute decisions about terminations of agreements and evictions.
Response: We do not believe this support requires a change to the
regulations. The requirements set forth in this final rule also address
the commenters' additional suggestion regarding an appeals process for
evictions and terminations of agreements.
Comment: One commenter indicated that their state has a long
history of providing services that are institutionally-based, with
misplacement of younger people in adult care homes that are for the
frail elderly. This commenter urged CMS to ensure that individuals have
assessments of need to ensure they are not placed in the wrong
settings.
Response: Sections 1915(c), 1915(i) and 1915(k) of the Act all
require that individuals have an individual assessment of needs that
includes the individual's needs, strengths, preferences and goals for
services and supports provided under the respective authorities.
Comment: One commenter appreciates CMS noting in the preamble to
the proposed rule the other authorities for providing Medicaid services
in certain institutional care settings (such as SNFs and ICFs), but
notes that this should not be construed to mean that assisted living
can or should be lumped with SNFs simply because both provide regulated
services in a congregate setting. The commenter does not support the
premise that residents of assisted living settings should ``fall back''
on the institutional model in order to access Medicaid services.
Response: It is not our intent to imply that all congregate
settings should be categorized as nursing facilities and/or
intermediate care facilities for individuals with intellectual
disabilities. State plan HCBS must be delivered in a setting that meets
the HCB setting requirements as set forth in this rule (except where
HCBS are permitted to be delivered in an institutional setting, such as
institutional respite). Also, since this authority provides states the
opportunity to provide individuals with HCBS and not institutional
services, individuals must be living in settings that comport with the
HCB setting requirements as set forth in this rule. Settings that do
not meet the requirements may be qualified to provide institutional
services.
Comment: One commenter suggests that states should consider whether
individuals have meaningful options among settings located in the
community, which afford them the choices that are integral to some of
the qualities that define HCB settings. The commenter suggests that
states should collect data on the choices and expressed preferences of
Medicaid beneficiaries who require HCBS and set goals to build adequate
infrastructure to meet these needs.
Response: We appreciate the commenters' thoughtful suggestions. The
regulation already requires that the setting be selected by the
individual from among housing options, and that the individual's choice
is documented in the person-centered service plan. We will not revise
the regulation to include the commenter's suggestion to require states
to use the data on the choices and expressed preferences to set goals
to build adequate infrastructure to meet these needs; however, we will
consider that suggestion as we develop future guidance.
Comment: One commenter agreed that these requirements should apply
to other HCBS funding streams such as the section 1915(c) waiver
program.
Response: We appreciate the commenter's support. As stated in the
preamble of the proposed regulation, these requirements will also apply
to section 1915(c) of the Act Home and Community Waiver programs and
the section 1915(k) of the Act Community First Choice state plan
option.
Comment: One commenter stated that individuals should not be forced
to live in the community, as this might not always be the individual's
preference.
Response: This requirement does not require individuals to live in
the community to receive necessary Medicaid services. Medicaid services
are available in a variety of settings. This regulation sets forth
requirements that must be met for individuals to receive services under
sections 1915(i), (c) and (k) of the Act.
Comment: We received many comments supporting the proposed
language. Several commenters support CMS' efforts in aligning HCBS
setting qualities under sections 1915(i) and 1915(k) of the Act and
agree with the proposed list of qualities for home and community based
settings at Sec. 441.656(a)(1) of the proposed rule that promote
patient autonomy, dignity, choice and preference. Several commenters
believe the provisions are strongly reflective of the belief that home-
and community-based services should be organized in a person-centered
manner, driven by the needs and preferences of the individual and that
those services acknowledge the rights of the individual to ``privacy,
dignity and respect''. Several commenters generally believe that the
provisions establish the essential elements of autonomy and person-
centered care in a way that promotes choice and independence. Many
commenters believe that the list of qualities promotes integration of
people with disabilities into the greater community and does not
restrict individuals with disabilities. One commenter recognized the
policy on this issue is complicated and believes that the proposed
language is a big improvement over previous proposals.
[[Page 2960]]
Response: We agree and appreciate the commenters' support.
Comment: A few commenters asked if the rule applies to private
homes and non-residential community settings where services may be
provided, such as adult day settings or day habilitation settings.
Response: 1915(i) State plan HCBS and 1915(k) CFC services (for
example, residential, day or other) must be delivered in a setting that
meets the HCB setting requirements as set forth in this rule. We will
provide further guidance regarding applying the regulations to non-
residential HCBS settings. In addition, since this authority provides
states the opportunity to provide individuals HCBS and not
institutional services, individuals receiving 1915(i) State plan HCBS
or 1915(k) CFC services must be living in settings that comport with
the HCB setting requirements as set forth in this rule regardless of
whether they are receiving HCBS in that residence. This is consistent
with CMS' longstanding policy regarding 1915(c) HCBS. We are unsure
what the commenter means by the term ``private home'' but a residence
owned or leased by an individual for his or her personal use would
generally meet these criteria.
Comment: One commenter suggests that CMS should consider requiring
and monitoring state reporting on measures related to the qualities of
home and community-based settings. The commenter suggests alignment
with section 1915(i) of the Act quality and reporting standards. An
alternative approach also suggested by the commenter is for CMS to
require a Memorandum of Understanding (MOU) between state agencies
documenting how they will work together to ensure consistency with the
quality requirements.
Response: Sections 1915 (c), (i) and (k) of the Act all require
states to demonstrate at the time of approval that they have a quality
improvement strategy that includes performance and outcome measures for
the HCBS, including measures for the HCB setting requirements. We are
currently working towards a streamlined approach to be used across
Medicaid HCBS.
Comment: One commenter recommended the rule be revised to include a
requirement that individual choice regarding supplementation of
services and supports and who provides them is facilitated, if
providers meet all applicable requirements of the licensed entity.
Response: We do not believe it is necessary to add language
addressing provider qualifications to this provision. Implementing
regulations for sections 1915(c), 1915(i) and 1915(k) of the Act all
include provisions that address provider qualification requirements.
Comment: Several commenters indicated that people with disabilities
should have the same rights, responsibilities and protections as
nondisabled people have under every state's Landlord and Tenant Law.
One commenter indicated that their state's landlord and tenant laws
currently in place are sufficient to satisfy the requirements of the
regulation (absent a court order, a person may not be involuntarily
evicted even if they need a higher level of care, are delinquent in
payment or create significant disruption for others living in the
congregate setting). Another commenter indicated that their state's
landlord tenant law must operate equally for everyone.
Response: We believe these comments are consistent with the intent
of this regulation. We note that we do not have the authority to
require states to modify their landlord and tenant laws.
Comment: One commenter suggested that CMS should clarify that all
settings in which the individual does not have a regular lease or full
ownership rights should be considered ``provider-controlled.''
Response: Any setting where the provider of HCBS also owns and
operates an individual's residential service is considered provider-
controlled.
Comment: A few commenters indicated that because there is no
definition of an individual's ``sleeping or living unit'' it is unclear
what area the individual's rights pertain to. The commenters requested
clarification that the ``unit or room'' to which the person is legally
entitled is at least the space to which the rights in Sec.
441.530(a)(1)(vi)(B)(1-3) should apply.
Response: The requirements set forth at Sec.
441.530(a)(1)(vi)(B)(1-3) apply to the sleeping or living unit that is
used by the individual, and is not a common area used by others
residing in the setting.
Comment: One commenter indicated that their state's landlord-tenant
laws and their housing with services regulations both apply to their
housing with services settings and the commenter wants to ensure that
anything that is finalized by CMS does not negatively impact the
consumer based system developed over the last two decades in that
state.
Response: The proposed language specified that ``the individual
has, at a minimum, the same responsibilities and protections from
eviction that tenants have under the landlord/tenant law of the state,
county, city or other designated entity.'' However, we heard from many
commenters that depending on the state, tenant law may not apply to
congregate settings, such as group homes or assisted living facilities.
To address such situations, we revised Sec. 441.530 and Sec.
441.710(a)(1)(vi)(A) to add the following language: ``For settings in
which landlord tenant laws do not apply to such units or dwellings, the
state must ensure that a lease, residency agreement or other form of
written agreement will be in place for each HCBS participant that
provides protections that address eviction processes and appeals
comparable to those provided under the jurisdiction's landlord tenant
law''. In all instances, these agreements must address eviction
processes and appeals. In summary, we believe that our language creates
a minimum requirement, but allows states to use existing laws or
establish new laws as long as they meet our minimum requirements.
Comment: One commenter found it difficult to support this
requirement based on the fact that each designated entity in the same
state can have different tenant laws.
Response: It is expected that states would establish policy and
procedures to assure compliance with this provision.
Comment: One commenter indicated that it might not be appropriate
to require all provider-owned and operated settings be subject to local
landlord and tenant laws or to meet all the requirements in Sec.
441.530(a)(2)(v) adding that for some individuals with chronic mental
illness or cognitive impairment, this strict requirement may exclude
the least restrictive environment in which they can reside. The
commenter indicated that CMS and state Medicaid agencies can use the
other provisions in Sec. 441.530 to insure that settings in which
residents receive services are designed to facilitate the actual
integration of the individual in the surrounding community without
prohibiting some residences that are provider-owned or controlled from
providing residential support to recipients.
Response: We have modified the regulation to include language to
address situations in which state landlord/tenant rules do not apply.
Comment: One commenter requested clarification as to whether the
provider has to hold the space when the terms of the lease are broken
and there is no payment of rent and suggested that CMS use the typical
landlord tenant language.
[[Page 2961]]
Response: It is beyond the scope of this regulation to address
issues such as when the terms of a lease are broken or rent is not
paid. This regulation defers to the state and local law, as applicable.
Absent applicable state or local law, the regulation provides minimum
requirements that the state must make sure are in place to inform
individuals of the eviction process and the process to appeal the
eviction.
Comment: One commenter noted that if the provider cannot evict the
individual from provider controlled housing all the other residents may
suffer and require new housing arrangements. The commenter stated that
providers of services have experience balancing the rights of multiple
residents and added that there are circumstances when eviction is in
the best interest of all residents.
Response: This regulation is not intended to override existing
rules governing adherence to proper eviction procedures. This rule
requires that individuals receiving Medicaid HCBS who are in provider
owned or controlled settings have the same or comparable protections
related to evictions as individuals not receiving Medicaid HCBS.
Comment: One commenter asked about situations where the individual
decides to participate in an activity that is contrary to the person-
centered plan, putting the individual in danger, and asked who is
liable for the outcome of the risky behavior. The commenter also wanted
to know if, when all parties have agreed to a plan and the individual
receiving supports departs from that to which s/he has agreed, the
provider has standing to require the individual to adhere to the plan
and may take steps to ensure compliance.
Response: We appreciate the commenter's questions. There is an
expectation that individuals and providers will adhere to the services
and activities identified in the person-centered service plan. If
individuals place themselves or those around them in danger, we expect
the state and provider to take the appropriate action necessary to
address the situation. However, after the immediate crisis is resolved,
we would expect a reassessment of needs to occur using the person-
centered service planning process and an update to the person-centered
service plan.
Comment: Many commenters expressed concern that the application of
landlord/tenant law would create a conflict with state licensing laws
governing assisted living providers or other congregate settings, and
indicated that the state licensure laws protect individuals from
arbitrary eviction and define the circumstances in which a provider may
and may not discharge an individual. The commenter added that providers
have an obligation to take all reasonable steps to accommodate an
individual before seeking a discharge, and recommended that CMS
consider the logistical and technical difficulties in referring to
state, county or city landlord/tenant laws, as these vary significantly
and would subject providers in different areas of the same state to
different standards depending on where they are located. The commenter
indicated that it would be burdensome for a state to create an HCBS
program that would take into account all the variations when trying to
meet these requirements, and suggested that providers that are not
licensed under an existing state licensing law be required to only
adhere to the state landlord/tenant law, to create uniformity and avoid
the administrative difficulties created by including county and city
laws. One commenter added that the legal relationship between a
provider and a resident is very different than that of a landlord
tenant relationship, as landlords typically do not provide, nor are
required by law to provide, food, housekeeping or assistance with ADLs
pursuant to a rental agreement. The commenters recommend that in lieu
of mandating eviction protections under landlord tenant laws, assisted
living facility resident protections be provided through specific
disclosure provisions as part of the resident agreement and approved by
the applicable state licensing authority. The commenter added that such
provision would specify the terms and conditions for move-in, including
conditions for discharge or transfer and an appeals process for
resolving disputes that are non-emergency in nature.
Response: We are pleased to hear that states have robust
beneficiary protections included in the licensing requirements of
certain settings. It is not our intent to replace a state's current
system. The intent of the language was to assert the expectation that
for a setting to be considered home and community-based, residents of
provider-owned or controlled residential settings must have comparable
protections available to them as those provided under the landlord
tenant law of the state, county, city or other designated entity. As a
result of the comments received, we have added to this requirement, for
settings in which landlord tenant laws do not apply, that the state
must ensure that a lease, residency agreement or other form of written
agreement is in place for each participant and that such agreements
provide protections that address the eviction processes and appeals
comparable to those provided under the jurisdiction's landlord tenant
law.
Comment: One commenter believes the Sec. 441.530 (a)(1)(vi)(A)
should be revised to permit discharge when an individual's condition
changes and care needs can no longer be met under the license of the
dwelling they occupy adding that there is nothing in the regulation
that abolishes the Keys amendment requirements for SSI recipients or
HCB waiver recipients.
Response: While we understand that there may be circumstances in
which an individual's needs require a different level of service, we
expect that the assessment of functional need, the person-centered plan
and the availability of HCBS will be able to address an individual's
changing needs. If it is determined that eviction or an involuntary
discharge is necessary, the state must ensure that proper procedures
for such actions are followed and individuals are fully informed of
their rights.
Comment: One commenter wanted to know if it is the responsibility
of the provider to assist the individual in finding other housing,
services, and supports.
Response: The state is responsible for addressing this assistance
through the person-centered planning process.
Comment: One commenter recommends the regulation require that
states and providers delineate (a) the conditions under which an
individual may be involuntarily moved from a setting he or she prefers,
and (b) the methods by which the individual will be informed of such
conditions at the time the individual chooses the setting.
Response: The regulation has been modified to provide that, in
circumstances where tenant landlord tenant laws do not apply, a lease,
residency agreement or other form of written agreement must be in place
that provides protections that address eviction processes and appeals
comparable to those provided under the jurisdiction's landlord tenant
law. Under circumstances where tenant landlord rules do apply, the
state will ensure compliance with those rules.
Comment: One commenter indicated that their state requires a
contract between the residents and providers and wanted to know if it
could be used in lieu of a lease.
Response: It is possible that this arrangement would comply with
the revised language allowing other forms of
[[Page 2962]]
written agreements to implement protections that are at least minimally
comparable to the protection provided under the jurisdiction's landlord
tenant law. A final determination of whether such contracts comply with
the regulatory requirements will be made through the state plan
amendment or waiver review process.
Comment: One commenter indicated that current requirements in their
State allow for adequate service planning and transition (30-day
notice) when a provider is unable to meet the needs of an individual,
and the State suggested that the proposed rule reflect a similar
requirement.
Response: We believe it is a good protection to include, however,
we do not propose to amend the regulation to require a specific
timeframe. We would like the state to retain flexibility in
establishing timeframes.
Comment: Two commenters indicated that in their state, the assisted
living model separates the assisted living services from housing. The
commenters noted that providers of assisted living services are
licensed and the services must be provided in a ``Managed residential
community'' consisting of individual apartments where residents can
continue to live and maintain personal autonomy. The commenters added
that residents are considered tenants and are protected under the
state's landlord tenant laws and that under this arrangement the
assisted living services provided within the managed residential
community are regulated by state licensure laws. The commenters
requested that the rule recognize laws and state licensure laws and
regulations that govern the provision of HCBS in their state.
Response: We believe the regulation allows for this.
Comment: Many commenters requested further clarification of the
``specific physical place'' language. In general, the commenters
support the idea that individuals in congregate settings should have
agreements for a specific room or unit and should not be arbitrarily
moved around by providers. However, the commenters note that landlord
tenant laws vary tremendously by state and their application to
specific residential arrangements tends to be fact specific and subject
to complex statutory and judicial interpretation. The commenters also
note that the federal Fair Housing Act prohibits discrimination in
almost all housing activities based on disability and requires housing
providers to make reasonable accommodations to rules and policies when
such accommodations are needed for the individual to use and enjoy the
housing. The application of the fair housing laws to residential
settings that are also subject to state licensure and regulatory
schemes can be complex, and the law in this area is continuing to
develop. Additionally the state's ``level of care'' licensure standards
that require the discharge of residents with certain types or acuity of
conditions are at odds with civil rights protections designed to allow
consumers to live and receive services in places they choose. Providers
are not required to make accommodations where to do so would result in
an undue financial and administrative burden or would fundamentally
alter the nature of the provider's operations. However, providers and
state licensing agencies are required to make reasonable accommodations
to enable people to remain in the homes that they choose if the
accommodations meet those tests. The commenters suggest that state plan
amendments and waiver applications should specify processes by which
they would make ``reasonable accommodations'' decisions without forcing
residents to make claims in court or forcing providers to jeopardize
their licensure by reasonably accommodating residents whose service
needs have intensified, for example. Reasonable accommodations
processes should provide plenty of notice and be easily used. A number
of states have enacted interactive processes to provide appeals and
individual determinations of the ability to remain, even if their
continued residency represents a violation of the level of care
requirements. Finally, a legally enforceable agreement under this
subsection should include a right to appeal decisions affecting
tenancy. Agreements should clearly specify the conditions that would
trigger a termination, including conditions related to the person's
health status or level of disability that would necessitate a move. The
individual should have the right to appeal termination decisions to an
objective third party in a timely manner, such as 30 days, which should
be defined in the state's waiver application. This appeals process
should be accompanied by the reasonable accommodation process noted
above. Other commenter's recommended that if a state's licensing
standards do not include such protections, then the landlord tenant
statutes should be the default law. Several commenters recommended the
following language: ``An individual has, under state licensing law,
protections from evictions. If these protections are not provided, the
individual shall have, at a minimum, the same responsibilities and
protections from eviction that tenants have under the landlord/tenant
law of the state, country, city or other designated entity.''
Response: We appreciate the commenter's thoughtful comments
highlighting the complexities of applying tenant landlord rules to
settings that normally do not have such an application. The regulation
has been modified to specify that in circumstances where landlord
tenant laws do not apply, a lease, residency agreement or other form of
written agreement must be in place that provides at least comparable
protections to those provided under the jurisdiction's landlord tenant
law. At a minimum, these agreements must address eviction processes and
appeals. Under circumstances where tenant landlord rules do apply, the
state will ensure compliance with those rules. We are not amending the
regulation to include specific language referencing state licensing
laws. Rather we have amended the language to add ``For settings in
which landlord tenant laws do not apply, the State must ensure that a
lease, residency agreement or other form of written agreement will be
in place for each HCBS participant and that the document provides
protections that address eviction processes and appeals comparable to
those provided under the jurisdiction's landlord tenant law.''
Comment: One commenter recommended replacing the proposed language
``the individual has, at a minimum, the same responsibilities and
protections from eviction that tenants have under the landlord tenant
law of the state, county, city or other designated entity'' with the
following:
(A)Individual has a lease, residency agreement or other form of
written agreement that includes the ability to appeal move-out
decisions to an objective third-party. Reasonable accommodations are
made both by the provider and the state to accommodate aging in
place. An appeal of a move-out decision should not prevent the move-
out when there is a significant risk of harm to the resident, other
residents, or staff. The appeal process will include nonpayment of
fees unless the state has a demonstrated alternative process for
addressing payment disputes. All appeals should be pursued
expeditiously and should not take longer than 30 days.
Response: We appreciate the commenter's recommendation, however we
do not believe it is appropriate to include as a requirement. We note
that the suggested language represents some good practice, and would
encourage states to include such protections in
[[Page 2963]]
their policy and procedures if they do not already exist.
Comment: One commenter recommended the following changes to the
proposed language: ``The unit or room is a specific physical place
that, if a `family care home', includes a private bedroom, and if not a
`family care home', includes, at a minimum, its own kitchen facilities,
sleeping area, and private bathroom with toilet, sink and shower or
bathtub, that can be owned, rented or occupied . . .''
Response: We appreciate the commenter's suggestions, however, we
will not revise the rule to include these types of specifications as
they would be overly prescriptive.
Comment: One commenter requested that we revise the regulation to
specify that the unit can be owned, rented or occupied under another
legally enforceable agreement by the individual receiving services ``or
his/her chosen surrogate, who must not be an agent of the service
provider,'' could be inserted.
Response: We do not believe the commenter's recommendation to add
language regarding a surrogate is necessary. The HCBS regulations
already address this in the definition of individual's representative.
Comment: Several commenters supported giving individuals who
receive HCBS in provider-owned or operated residential settings
protections under landlord tenant law, and suggested adding protections
afforded by the ADA to this section to ensure that individuals living
in these settings whose health needs change are afforded appropriate
accommodations (such as increased staff), in order to continue living
in the setting.
Response: While we do not administer or enforce the ADA, we note
that Medicaid regulations prohibit discrimination in State Medicaid
programs (Sec. 430.2, Sec. 435.901, Sec. 435.905, and Sec.
435.908). As these regulations apply in determining eligibility and
administering the Medicaid program generally, it is not necessary to
amend this regulation on this subject.
Comment: A few commenters recommended the word ``unit'' be replaced
with ``room'' throughout the document.
Response: We do not agree with the recommendation to remove the
term unit, but to provide additional clarification, we have revised the
language to add the term ``dwelling'' since this is the common term
used under prevailing state and local landlord/tenant laws.
Comment: Several commenters agreed with the list of requirements
for provider owned and controlled residential settings. One commenter
added that preservation of the right to privacy, including having a
lockable unit and the ability to control access to the unit, and self-
control of the participant's schedule, are also important indicators
for basic human dignity. Another commenter noted that individuals with
disabilities should be afforded the same rights as anyone else in the
country.
Response: We agree and appreciate the commenter's support.
Comment: One commenter indicated that ``the freedom to furnish and
decorate their sleeping or living unit'' could use clarification noting
that there are many landlords that have restrictions on water beds, or
permission prior to painting. The commenter added that all rules
relating to entrance locks, roommates, furniture preferences, daily
schedules, food, visitors, etc., must include caveats as to feasibility
and reasonableness.
Response: These requirements pertain to settings that are owned or
controlled by a provider. Landlord tenant laws may allow landlords to
set reasonable limits as long as the limits are not discriminatory or
otherwise deny rights granted to tenants under the state law.
Therefore, we have added additional language to this requirement to
clarify that, in a provider-owned or controlled setting, the
individual's freedom to furnish and decorate sleeping or living units
may contain limits within the scope of the lease or agreement.
Comment: One commenter expressed support of the criteria when an
individual lives alone, but wanted to know in situations where an
individual chooses to live with a roommate who is responsible for
collaborating schedules and ensuring that one person's right to have
visitors does not infringe on the privacy of the other.
Response: While this is not specifically addressed through
regulation, we note that there are many ways to address this concern,
including through good roommate communication.
Comment: Several commenters recommended that ``their'' be changed
to ``the,'' since ``individual'' is singular but ``their'' is plural.
Response: We agree with the commenter and have revised the
regulation accordingly.
Comment: One commenter noted that individuals requiring care and
services will have their privacy limited in some fashion while those
care and services are being provided and suggested the following
revision to Sec. 441.530 and Sec. 441.656(a)(1)(vi)(B): Each
individual has privacy in their sleeping or living unit, to the extent
care and services are provided in accordance with the individual's
assessed needs.
Response: We do not believe the recommended revision is necessary
as there is a general requirement that services are provided in
accordance with an individual's assessed needs. This requirement is
expressed at Sec. 441.530(a)(1) and Sec. 441.710(a)(1) and also under
person-centered planning provision of the regulations for sections
1915(c), 1915(i) and 1915(k) of the Act.
Comment: A few commenters disagreed with the proposed language
requiring that units have lockable doors. The commenters believe that
this requirement poses a safety risk in the event of an emergency and
added that clarification is also needed on a unit owned by the resident
who may not want to provide the appropriate staff with keys to his/her
door. The commenters pointed out that in some apartment buildings the
entrance door is the unit's door and asked if the resident owns the
unit whether he/she will be required to provide appropriate staff with
keys.
Response: We disagree that the recommended change is necessary.
However, the requirement for a lockable entrance door may be modified
if supported by a specific assessed need and justified and agreed to in
the person-centered service plan. Additionally, the state must ensure
adherence to requirements set forth at Sec. 441.530(a)(1)(vi)(F) and
Sec. 441.710(a)(1)(vi)(F).
We would like to clarify that this regulation does not require
individuals to provide keys to anyone. The language is meant to curtail
the issuing of resident keys to all employees or staff regardless of
the employee's responsibilities, thus granting employees unlimited
access to an individual's room. This provision indicates that only
appropriate individuals should have access to an individual's room. For
example, it may be appropriate for the property manager to have keys,
but it might not be appropriate for the individual working at a
reception area.
Comment: One commenter recommended the additional phrase ``if
necessary'' be added after ``appropriate staff,'' as there may be
occasions when the particular setting will not have staff members
holding keys to living units. Several commenters recommend adding the
phrase ``as appropriate'' at the end of the provision since there may
be times when a setting will not have staff members with keys to living
units.
Response: We agree with the second commenter's concern and have
[[Page 2964]]
modified the regulatory language accordingly to indicate ``as needed.''
Comment: Other commenters advised that they support lockable
entrance doors with appropriate staff having keys to doors, since there
are also provisions under the individual modification of requirements
discussed below that can be used for individuals with cognitive
impairments for whom lockable doors and free egress may present safety
and other issues. In such cases, alternative means for assuring
meaningful individual privacy should be required (for example, knocking
and waiting for a reply before entering a person's private space,
respecting private possessions, etc.).
Response: We appreciate the commenter's support.
Comment: Two commenters expressed concern that the regulation does
not specify a process to determine which staff will have keys, or that
the individuals themselves must have keys. One of the commenters is
aware of instances where people have been denied key access to their
own homes without appropriate justification. The commenter recommended
that CMS add language to require that (1) the staff that will have keys
are included/identified in the person-centered service plan and chosen
by the individual and (2) the individual must also have a key to the
door. The commenter recommended the following language: ``Staff holding
keys will be named in the person-centered service plan and individuals
must have keys to their own units'' to Sec. 441.530(1)(vi)(B)(1),
Sec. 441.656(1)(vi)(B)(1), and Sec. 441.665(b)(3) for clarity across
the regulations.
Response: We do not agree that the regulation should require that
the person who has keys should be identified in the person centered
plan, but we do agree that the individuals should have a say and agree
with who that person is. We agree with the recommendation that
individuals have keys to their door, and have clarified the language in
the appropriate sections of the regulation so that this is unambiguous.
As noted above, an individual's use of the room key may be modified if
supported by a specific assessed need and justified and agreed to in
the person-centered service plan.
Comment: One of the commenters requested that CMS clarify whether
the proposed rule requires the homes to be locked or the bedroom doors
to be locked.
Response: We would like to clarify that the individual must be able
to lock the door to their unit or dwelling, that the individual has a
key to the door, and that only appropriate staff have keys.
Comment: Several commenters offered support of the requirement that
individuals share units only at the individual's choice. One commenter
does not believe that sharing units is faithful to the principles of
HCBS. We also received comments opposing the requirement or requesting
further clarification of the intent of the requirement. Several
commenters believe this provision is inappropriate and recommended that
the private room/living space requirement be deleted completely.
Commenters noted that Medicaid does not cover room and board costs so
they believe that the term ``choice'' could be misleading, as the
determining factor for choosing double occupancy versus a single-
occupancy unit may be whether a resident can afford to. Many
individuals are not financially able to afford a private room in
settings such as assisted living facilities. One commenter expressed
concern that, as proposed, allowing individuals to choose to share
units without also requiring states to provide (financially needy)
individuals with adequate funding, such as increasing the maintenance
needs allowance, will force those individuals into nursing facility
settings. One commenter added that ``individual choice'' should be
reflective of an individual's resources and care needs. Another
commenter believes that since beneficiaries typically pay for room and
board out of their SSI benefit the proposed language would effectively
exclude assisted living as an option for Medicaid individuals in many
states since providers cannot afford to offer private rooms at the rate
Medicaid beneficiaries pay. A few commenters added that sharing living
units may be necessary to ensure a range of housing options the HCBS
waiver program and at the same time manage resources to meet the cost-
neutrality standard under the section 1915(c) of the Act waiver
program. A few commenters interpreted the regulation to require
separate bedrooms for all individuals receiving residential services
unless the individual requests otherwise and stated that this
requirement will result in a huge unfunded mandate that will double the
cost of residential group home care. Commenters suggested the following
regulatory changes related to this provision:
Revise the rule to say ``Individuals in shared rooms will
have a choice of roommate.''
Revise the rule to say ``Individual roommate preferences
are accommodated to the maximum extent practical and documented in the
individual's person-centered service plan.''
Revise the rule to add a requirement that individuals
should not have to share a unit unless it is with a spouse, partner, or
other family member.
One commenter recommended that sharing a bedroom is
clearly documented as the choice of the individual and that the room is
shared only with a person of the individual's choosing.
One commenter suggested that the rule needs to make it
clear that a resident's choice acknowledges his economic situation.
Other commenters noted that if the requirement is
finalized, CMS needs to add an exception to the requirement for
residential settings that do not meet the private room/living space
requirement but are appropriate to meet the waiver client's needs and
preferences according to the individual, the client's designated
representative and the case manager.
Revise the rule to say '' Individuals with disabilities
receiving HCBS share units with other individuals with disabilities
receiving HCBS, whether the unit is a single bedroom or a multi-room
living space, only at the choice of the individual with disabilities
receiving HCBS, at all times and under all circumstances. Individuals
with disabilities receiving HCBS may share such units with a person who
is present to provide services to the individual if necessary for
safety reasons, if appropriately justified and documented.''
Response: We understand the concerns raised by the commenters. We
have clarified that we are not requiring that every individual
receiving HCBS have their own bedroom when receiving residential
services. The rule is requiring that individuals be provided options of
residential settings, including an option of a private room. This rule
does not require every provider to have a private room option. Instead
it requires the State to ensure that there are private room options
available within a state's HCBS program. We agree with the commenters
that the financial resources available to an individual may impact the
options available to a particular individual and we have changed the
regulatory text to make that clear. We also agree with the commenters
that if an individual chooses to share a room, that individual also
must have a choice of their roommate. We have changed the regulatory
text to clarify this. We plan to address these issues further through
future guidance.
[[Page 2965]]
Comment: One commenter indicated that in their assisted living
facility, all residents have a private room but share a \1/2\ bath with
the private room next door and believes that under the proposed
regulation a resident in this kind of situation would never find the
appropriate bath mate because the rule would require that they have
their own \1/2\ bath and the commenter believes this was not CMS'
intent.
Response: We believe that the arrangement described by the
commenter, that one bathroom is shared between two private rooms, will
meet the requirement at Sec. 441.530(a)(1)(vi)(B)(2) and Sec.
441.710(a)(1)(vi)(B)(2) that individuals share units only at the
individual's choice.
Comment: One commenter recommended that CMS form a work group of
stakeholders to determine a method for ensuring that Medicaid waiver
applications and renewals demonstrate how the state assisted living
program ensures adequate reimbursement for private room occupancy (that
is, the state assisted living program does not restrict room and board
payments to less than the cost of providing a private room and provides
housing assistance as required).
Response: States are required to provide opportunities for public
input in the development of Medicaid service rate methodologies. During
the SPA review process, we ensure that the state has met this
requirement and that the state's proposed reimbursement methodologies
comport with requirements at section 1902(a) of the Act. These include
safeguards against unnecessary utilization of services, assurance that
payments are consistent with efficiency, economy, and quality of care,
and that payments are sufficient to enlist enough providers so that
care and services are available under the plan at least to the extent
that such services are available to the general population in the
geographic area.
Comment: One commenter suggested that the requirement that
individuals have privacy in their sleeping or living unit should not be
waived by the provider/state.
Response: We agree that an individual's privacy should always be
respected. Where any modification of this condition occurs, we have
included protections in the rule to ensure the individual's rights are
respected.
Comment: Several commenters strongly urged CMS to require that a
bathroom be in the unit for all settings with a capacity of six or more
residents as the commenters believe that having one's own bathroom is a
fundamental characteristic of living in one's own home. The commenters
noted that CMS proposed a similar requirement last year, and believes
that such a requirement is no less important today and added that it
would be difficult to consider a setting ``community-based'' if, for
example, a building housed 10 or 20 residents who shared a bathroom or
bathrooms located off a main hallway, and a resident at 2 a.m. had to
walk down the facility hallway in order to use the bathroom. The
commenters recommended the following provision be added to the
requirements at (B): Units include at least one full bathroom (unless
the setting is in a building with a capacity of six or fewer
residents).
Response: We understand the commenters' concern; however, the
standard for how many bathrooms a dwelling must have is governed by
building code, and is beyond the scope of this regulation.
Comment: One commenter expressed the opinion that the bathroom is
the most private part of their home, and inability to control functions
performed in that room is a major source of feelings of loss of dignity
and personal autonomy among people with disabilities. As such, the
commenter believes that privacy in the bathroom should be maximized and
assistance should be provided only when actually needed, limited to
specific tasks and carried out one-on-one with the bathroom door
closed.
Response: We agree with the commenter and believe that an
individual's privacy should be respected in all activities of an
individual's life.
Comment: Several commenters expressed strong support and
appreciation for the inclusion of this provision and two noted that the
inability to decorate or furnish a living unit would be a clear
indicator of an institutional model.
Response: We appreciate the commenters' support.
Comment: A few commenters supported the proposed rule as written.
Response: We appreciate the commenter's support.
Comment: One commenter supports the regulation, but believes the
rule should go further and require living units to have access to food
storage and preparation space (with the caveat that stoves or
microwaves could be removed if the assessment documented that it would
be a danger because of the resident's cognitive impairment).
Response: We agree with the commenter and believe that this is
reflected in this regulatory language.
Comment: Several commenters generally supported the proposal that
individuals have the freedom and support to control their schedules and
activities, but recommended that the word ``control'' be changed to
``choose'' noting that choice is a foundational element of HCBS and
merely allowing individuals to control schedules and activities is
inadequate. According to commenters, supporting an individual and
providing the support necessary to participate in activities (for
example, the transportation to attend a selected activity) allows for
full community living.
Response: We believe that it is fundamental for individuals to have
the control to make their own choices. Therefore, we do not believe it
is necessary to change the word control.
Comment: While commenters agreed with the principle that a resident
should be able to eat, socialize and come and go freely, several
commenters expressed concern with the proposed language and suggested
that (a)(1)(vi)(C) should not focus on ``access'' but rather on the
individual's choice to select the foods they eat, to store food in
their rooms, to bring back food from the facility's kitchen and to
reschedule meal times. The commenters pointed out that because HCBS
facilities most likely schedule meals at specific times, as required by
regulation, a resident may not have access to all food in the building
all the time, and a residential setting cannot reasonably accommodate
each individual's preference on a 24-hour a day basis. One commenter
requested clarification as to whether or not the proposed ``access''
requirement would result in a housing arrangement that includes a daily
activity (such as meals) at pre-arranged time not being considered a
home and community-based setting. A few commenters requested that the
final regulation be stronger in its intent to ensure meaningful choice
and provide for activities that will support integration with the
community. The commenters noted that as written the language could be
easily interpreted to maintain institution-like settings instead of
true community living. The commenters are concerned about situations in
which individual choice is not meaningful, for example, an individual
being given access to food by having the choice of a snack bar or a
pitcher of water and crackers.
Response: We disagree with the commenters' belief that a
residential setting cannot reasonably accommodate an individual's
preference on a 24-hour a day basis. The opportunity for individuals to
select the foods they eat,
[[Page 2966]]
store food in their room, eat in their room, and decide when to eat are
all ways in which the access to food requirement can be met. Under this
provision, giving an individual the choice of a snack bar or a pitcher
of water and crackers does not meet the access to food requirement. An
individual should not be presented with narrow options, decided by
someone else, without input from the individual.
Comment: One commenter believes the term ``food'' can be
interpreted broadly and could lead participants to believe that there
must be 24/7 access to full service dining. The commenter recommended
that in order to eliminate the range in interpretation, CMS replace the
word ``food'' with ``snacks.''
Response: We disagree with the recommended change. We expect that
the individual will have access to food. This requirement does not
pertain to full dining services or to meal preparation, only access to
food.
Comment: One commenter cautioned that the freedom and support of
access to food at any time needs to be carefully monitored and offered
the example that unrestricted access to food may be unrealistic for
individuals with eating disorders or brain injury.
Response: Modification to this requirement may occur as long as it
is done in compliance with Sec. 441.530(a)(1)(vi)(F) and Sec. 441.710
(a)(1)(vi)(F).
Comment: One commenter noted that freedom to control schedules and
activities with support to do so is a different issue from ``access to
food at any time'' and requested if CMS intended the support to be
available for food related activities as well?
Response: It is unclear what the commenter means by ``food related
activities.''
Comment: One commenter believes that the requirement that
individuals have ``freedom to control schedules and activities with
support to do so'' should not be permitted to be changed by the
provider/state. The commenter explains that this is a particularly
important point because many residential facilities have policies and
procedures that say that residents have freedom to choose and
participate in preferred activities, but as a matter of actual fact,
the facilities do not provide the necessary support to make such
freedom a reality. The commenter suggests that this subsection may be
an appropriate place to state that ``a person's ability to receive any
service from any provider described in his/her person-centered plan
will not be infringed upon by any provider for any reason.''
Response: We agree that a person's ability to receive services
identified in the person-centered service plan should not be infringed
upon by any provider for any reason. We believe that preventing an
individual from receiving any service identified in the person-centered
service plan is a direct violation of the person-centered plan
requirements and the home and community based setting requirements
specified in this regulation. Additionally, any setting not adhering to
the regulatory requirements will not be considered home and community-
based. The supports necessary to achieve an individual's goals must be
reflected in the person-centered service plan as required under Sec.
441.725(b)(5).
Comment: One commenter suggested that, to modify the condition
pertaining to individuals having visitors of their choosing at any
time, provider documentation should be required for a safety need to
restrict access to a person's desired visitors, the names of specific
visitors whose access will be controlled, how access will be
controlled, along with a description of the specific independently-
verifiable threats of real harm that uncontrolled access by those
visitors represent to the person. The commenter suggested that the plan
should allow visits even by people on this controlled-access list if
they can be conducted safely by providing a monitor or other means.
Response: We appreciate the commenter's general support. The
regulation has been modified at Sec. 441.530(a)(1)(vi)(F) and Sec.
441.710(a)(1)(vi)(F) to specify the requirements that must be met to
modify the condition pertaining to individuals having visitors of their
choosing at any time.
Comment: One commenter expressed concerns that some assisted living
settings may have policies about visitation and that as a result they
would be automatically eliminated from being considered community-based
settings.
Response: Settings that do not comply with the requirements of this
regulation will not be considered home and community-based settings.
Comment: Several commenters supported individuals' rights to have
visitors of their choosing at any time; however, the commenters noted
that in a provider-based setting this right should be viewed in the
context of shared living arrangements. Several commenters noted that
the safety of other residents and their ability for quiet enjoyment of
their living setting must be considered and suggested that the rule be
revised to add language that allows for reasonable rules for safety and
the quiet enjoyment of the provider setting.
Response: We acknowledge that in certain living situations the
preferences of others must also be respected. We expect that there will
need to be communication and coordination between all parties affected.
Comment: A few commenters voiced concern that allowing some
individuals to have any visitors of their choosing at any time in some
cases could be a safety issue. Another commenter added that it is not
reasonable that residents be allowed to have visitors to the extent
that they can ``visit'' for extended and/or indefinite periods of time,
noting under the proposed language, these visitors could actually live
in the HCB setting.
Response: It would be reasonable for there to be limitations on the
amount of time a visitor can stay as to avoid occupancy issues. Such
limitations should be clearly stated in a lease, residency agreement,
or other form of written agreement.
Comment: Several commenters supported the proposed language in
general but one recommended that CMS add ``including overnight'' to
allow for individuals to have visitors of their choosing at any time as
this is a right that others have.
Response: We believe the language adequately addresses this issue,
and allows for flexibility as appropriate.
Comment: Several commenters recommended that the proposed
requirement on visitors have additional language and protections, which
would allow for reasonable limitations on how and where visits are
conducted for safety and the quiet enjoyment of the provider setting
for all residents. One commenter suggested that the provision be
changed to read: ``individuals are able to have visitors of their
choosing at any time that is reasonably and mutually agreeable with
other members of the household and consistent with their support
needs.'' Two commenters recommended adding the phrase ``provided such
visitors are not disruptive to individuals in the residential setting''
to the end of the proposed language. One commenter recommended the rule
be revised to say ``if the building rules are established and approved
by the residents, they are allowable and residents can receive HCBS.''
Another commenter believes CMS should add a provision that the provider
can deny access of visitors if there is a reasonable belief that the
visitor presents a danger.
Response: We believe the regulatory language adequately addresses
the visitation requirement. We will take the
[[Page 2967]]
commenters' suggestions under consideration as we develop further
guidance.
Comment: Several commenters strongly supported this provision as
proposed and stressed that it is an essential provision. These
commenters expressed concern that under current standards, some
assisted living settings are not physically accessible and have
nonetheless received HCBS waiver funding for setting services. One
commenter supported this requirement and added that the modifications
and justifications for physical accessibility are included in the
service plan.
Response: We appreciate the commenters' support.
Comment: One commenter believes that the proposed language is too
vague and noted that additional guidance is essential, especially given
the limited availability of resources to upgrade existing facilities
and the varying degrees of accessibility needed depending on the nature
of any particular disability. Some commenters noted that settings must
be physically accessible under the ADA and Section 504 of the
Rehabilitation Act without reference to any specific characteristics of
the individual and therefore, indicated that this provision isn't
necessary. A commenter indicated that there are no possible legitimate
safety reasons for not providing a physically accessible residential or
program setting to any person with a disability, and that failure to do
so may be a safety hazard. These commenters advised that this condition
must not be modifiable for any reason.
Response: We agree and revised the regulations so that they do not
include Sec. 441.530(a)(1)(vi)(E) and Sec. 441.710(a)(1)(vi)(E) as an
additional condition that can be modified.
Comment: Two commenters indicated that to ensure the exclusion of
segregated settings and promotion of integrated settings, CMS should
revise this provision to specify that a provider-owned or controlled
residential setting should not only be ``physically accessible,'' in
terms of architecture for persons with mobility disabilities, but
should also be accessible for persons with sensory disabilities. This
includes ensuring effective communication through the provision of
auxiliary aids and services, such as but not limited to sign language
interpreters, alternative formats, and adapted equipment and devices,
such as smoke alarms and telephones.
Response: We do not agree with commenter's suggestion to revise the
regulatory language. Items and services that are needed by individuals
to live in their homes and communities would need to be identified
through the person-centered planning process and some of those items
and services may be covered through a Medicaid service, such as 1915(i)
HCBS, State plan home health or under a 1915(c) HCBS waiver.
Comment: One commenter supports the list of excluded settings.
Response: We appreciate the commenter's support. The excluded
settings included in the regulation are consistent with the settings
excluded in statute.
Comment: Many commenters noticed the difference between Sec.
441.530(a)(2)(iv) and Sec. 441.656(a)(2)(iv). The commenters wanted to
know if the difference exists because the 1915(i) statute refers to
``hospital'' as institutionalized care, whereas 1915(k) does not. To
the extent possible, the commenter encouraged CMS to be consistent
across authorities if it intends to clarify this difference.
Response: Whereas section 1915(k)(1)(A)(ii) of the Act expressly
prohibits a nursing facility, institution for mental diseases, or an
intermediate care facility for the mentally retarded from being
considered home and community based settings, the statute did not
include a hospital among the list of excluded settings. In an effort to
be consistent with other authorities providing HCBS, we proposed to
exclude hospitals providing long-term care services from the definition
of a home and community setting for the provision of the Community
First Choice Option. We believe that it would be duplicative to provide
CFC services, such as assistance with activities of daily living, in
such settings. Additionally, we believe this exclusion aligns with
section 1915(k)(1)(A)(ii) of the Act requiring that services are
provided in a home and community-based setting and section
1915(k)(3)(B) of the Act requiring that services are provided in the
most integrated setting appropriate to the individual's needs. However,
we understand that individuals will likely have a continued need for
certain types of assistance while experiencing a short-term stay in a
general acute hospital setting. Under such circumstances, most services
provided in a general acute care hospital are not CFC services, but
individuals who have an assessed need for assistance with IADLs may
continue to receive such services while an inpatient in such a setting.
Comment: Many commenters requested this section be revised to
exclude ``a hospital'' without the proposed qualification that it must
provide long-term care services. One commenter also agreed with the
recommended revision and expressed concern about duplication of
services. The commenter believes that allowing an individual to receive
IADL services during a short-term stay in a general acute hospital
would be hard to administer without increased costs to the state. The
commenters want the language to be consistent with Sec.
441.656(a)(2)(iv), which excludes any section 1915(i) of the Act
service from being provided in a hospital.
Response: As with payment for any Medicaid service, we expect
states to have processes in place to safeguard against unnecessary
utilization of such care and services and prevent the duplication of
the payments of Medicaid services. We understand that individuals may
have a continued need for assistance with certain IADLs while
experiencing a short-term stay in general acute hospital settings.
Therefore, while services provided in a general acute care hospital are
not CFC services, individuals who have an assessed need for assistance
with IADLs may continue to receive such services, as long as those
services do not duplicate services provided by the hospital setting
while an inpatient in an acute hospital setting.
Comment: A few commenters agreed with the regulatory language
stating that individuals in an acute care hospital who need assistance
with IADLs, should not be prevented from receiving such services while
they are in an acute hospital setting. The commenters further stated
that the ability to receive these services, as needed, while in the
hospital could enable a smoother transition after hospital discharge
back to a home or community setting and help prevent
institutionalization.
Response: We appreciate the commenters' support, and will include
this provision into the final regulation.
Comment: Several commenters requested the regulation be revised to
add ``Board and Care homes'' for people with disabilities to the list
of excluded settings, because of the institutional manner in which they
operate.
Response: We do not believe it is necessary to identify specific
settings, beyond what is specified in statute. States define settings
differently, and the way board and care operates in one state, may be
very different from the way board and care settings operate in another
state. Recognizing the lack of national standard-setting definitions,
we believe defining the qualities that all settings must exhibit to be
considered home and community-based is the best way to apply a national
standard. We believe the most effective and consistent
[[Page 2968]]
way to assure that individuals receiving Medicaid HCBS, regardless of
age or type of disability, are offered HCBS in the most integrated
setting appropriate to their needs and preferences, is to focus on the
qualities of ``home'' and ``community'' that assure independence and
integration from the perspective of the individuals. We will provide
additional guidance to states to identify any other setting that has
the effect of isolating individuals receiving Medicaid HCBS from the
broader community of individuals not receiving Medicaid HCBS.
Comment: In response to the request in the preamble for comments on
whether there are settings in addition to those currently enumerated
that are, by their nature, location, or administration inherently non-
community based, several commenters suggested Sec. 441.530(a)(2)(v)
and Sec. 441.710(a)(2)(v) be revised to say ``Any other locations that
have qualities of an institutional setting, as determined by the
Secretary. The Secretary will apply a rebuttable presumption that a
setting is not a home and community-based setting, and engage in
heightened scrutiny, for any setting that is isolated from the larger
community, does not allow individuals to choose whether or with whom
they share a room, limits individual's freedom of choice on daily
living experiences such as meals, visitors, and activities or limits an
individual's opportunity to pursue community activities.'' The
commenters also stated that if CMS does not make the recommended
revision, then the regulations in Sec. 441.530(a)(2)(v) and Sec.
441.710(a)(2)(v) should specify that such characteristics give rise to
a rebuttable presumption that the setting is not home and community
based.
Response: We appreciate the commenters' suggestions, however we
believe they are already addressed in Sec. 441.530(a)(1) and Sec.
441.710(a)(1). Therefore we will not revise Sec. 441.530(a)(2)(v) and
Sec. 441.710(a)(2)(v) to include the commenters' suggestions as we
believe it would be duplicative.
Comment: One commenter indicated that it is difficult to imagine
how settings located on or adjacent to the grounds of an institution
could be considered home and community based. Another commenter further
added that the regulation should be revised to add that the settings
listed in Sec. 441.530(a)(2)(v) to the list of excluded settings.
Response: In response to the many comments we received, we will not
amend the regulation to explicitly prohibit settings listed in section
Sec. 441.530(a)(2)(v) from the definition of home and community-based.
However, such settings are presumed to be institutional. States wishing
to identify such settings as home and community-based may, during the
SPA and waiver submission and review process, provide evidence as to
how such settings are not institutional in nature. We will determine if
the setting is not an institution and meets the HCB setting
requirements.
Comment: One commenter requests CMS reconsider its position with
regard to the provision of HCBS on ICFs/MR campuses and planned
residential communities for people with developmental disabilities.
Response: ICF/IIDs (formally known as ICF/MRs) are statutorily
prohibited from being considered home and community-based under the
authorities of sections 1915(c), (k) and (i) of the Act and services
provided on the campuses of these facilities are presumed to not have
the qualities of HCBS under this rule and subject to the heightened
scrutiny provision of this rule.
Comment: A few commenters requested the rule clarify that the
exclusion is intended for residential supports and not supported
employment or other vocational activity that may find an individual
choosing competitive employment in a setting that may be located in a
building on the grounds of, or immediately adjacent to a public
institution or disability-specific housing complex.
Conversely, another commenter expressed concern that people with
disabilities are being served in segregated work and day settings that
do not meet the ``most integrated setting'' definition and do not
comply with guidance related to the ADA and the Olmstead decision
issued by the US Department of Justice (DOJ). Additionally, the
commenter indicated that DOJ has made it clear that the ADA's
integration mandate includes day and employment services, and that
unwarranted placement in segregated day programs is a violation of this
mandate. Thus, this commenter recommends that CMS consider excluding
segregated, congregate facilities and programs from the definition of
HCBS. The commenter also recommends specifying the following settings
are excluded (per DOJ guidance): (1) Congregate day and employment
services populated exclusively or primarily with individuals with
disabilities, (2) Congregate day and employment services settings
characterized by regimentation in daily activities, lack of privacy or
autonomy, policies limiting visitors, or limits on individuals' ability
to engage freely in community activities and to manage their own
activities of daily living; or (3) Day and employment services settings
that provide for daytime activities primarily with other individuals
with disabilities. The commenter recognizes that if these
recommendations are adopted, a transition period is necessary to ensure
sufficient time for services to meet these new requirements.
Response: CMS does not have the general authority to enforce the
ADA independently of its oversight of the Medicaid program. To the
extent that the services described are provided under 1915(i) or
1915(k) (for example, residential, day, or other), they must be
delivered in settings that meet the HCB setting requirements as set
forth in this rule. We will provide further guidance regarding applying
the regulations to non-residential HCBS settings. In addition, since
this authority provides states the opportunity to provide individuals
HCBS and not institutional services, individuals receiving 1915(i)
State plan HCBS or 1915(k) CFC services must be living in settings that
comport with the HCB setting requirements as set forth in this rule
regardless of whether they are receiving HCBS in that residence. This
is consistent with CMS' longstanding policy regarding 1915(c) HCBS.
Comment: One commenter recommends establishing a maximum limit to
the number of individuals living in a provider-owned or controlled
residential setting.
Response: We do not believe there is a maximum number beneath which
we could determine with certainty that the setting would meet the
requirements of HCB settings. The focus should be on the experience of
the individual in the setting. In addition, we respect a state's right
to establish state laws to implement such a requirement regarding size.
We intend to provide additional guidance to states to identify any
other setting that has the effect of isolating individuals receiving
Medicaid HCBS from the broader community of individuals not receiving
Medicaid HCBS. We plan to include in the guidance examples of specific
settings that will require heightened scrutiny and may identify
additional qualities, including the size of the facility, triggering
such scrutiny. Our experience through our work with other federal
Departments and current research indicates that size can play an
important role in whether a setting has institutional qualities and may
not be home and community-based.
Comment: One commenter added that an approach focused on
characteristics,
[[Page 2969]]
rather than locations, provides a useful framework to define home and
community-based settings, while allowing consumers of long-term
services and supports choices regarding the services and supports they
receive and from whom they receive them, rather than limiting the
person's choices arbitrarily. However, several other commenters
expressed opposition to this language and requested that it be removed
completely. These commenters stated that, if a provider-based setting
can meet all of the criteria in paragraph (1), it should not matter
where the provider is located, and applying a rebuttable presumption is
redundant. They also stated that the focus should be on the autonomy of
the individuals receiving services. One from this group of commenters
stated that the ``rebuttable presumption'' could create a standard that
is difficult to meet and imposes obstacles that are unnecessary and
unreasonable. This commenter also stated that each setting regardless
of physical location should be evaluated in accordance with the same
quality review criteria and that the rebuttable presumption is not good
public policy and has the potential to be prejudicial. Another
commenter stated that the focus should not be on the setting, but
rather on an individual's choices and the person-centered service plan,
and does not believe arbitrary geographic or location-specific criteria
are appropriate. One expressed that this requirement will hinder
current initiatives to rebalance state's long term care systems.
Another expressed concern with the effect this language would have on
settings financed by the Department of Housing and Urban Development
(HUD) with millions of dollars to develop group homes, apartment
complexes and other housing for individuals with developmental
disabilities. Another stated that some individuals make the choice to
live in disability-specific housing with proximity to friends that rent
from the same provider, or that they choose housing in a convenient
location with access to services such as transportation.
Response: We appreciate the comments provided about the challenges
of the term rebuttable presumption. The proposed language provided a
list of settings that, from our experience in approving and monitoring
HCB programs, typically exhibit qualities of an institutional setting.
However, we recognize that state innovations, creative and proactive
efforts to promote community integration, and market changes could
result in the settings being located in a building that also provides
inpatient institutional treatment, or in a building on the grounds of,
or immediately adjacent to a public institution, that in some instances
could be considered home and community-based. In response to public
comments, we have revised the regulatory language to say ``Any setting
that is located in a building that is also a publicly or privately
operated facility that provides inpatient institutional treatment, or
in a building on the grounds of, or immediately adjacent to, a public
institution, or any other setting that has the effect of isolating
individuals receiving Medicaid HCBS from the broader community of
individuals not receiving Medicaid HCBS will be presumed to be a
setting that has the qualities of an institution unless the Secretary
determines through heightened scrutiny, based on information presented
by the state or other parties, that the setting does not have the
qualities of an institution and that the setting does have the
qualities of home and community-based settings.'' We believe the
revised language more clearly reflects the intent of this provision.
Comment: One commenter expressed concern with the ultimate
discretion granted the Secretary through this regulation; the commenter
categorizes it as ``authority with strings attached.'' The presumption,
coupled with the requirement of heightened scrutiny for certain
proposals, makes it very difficult for the Secretary to find in favor
of innovative partnerships that provide immediate and consistent access
to necessary health care, peer relationships, and legitimate
``integration,'' including HCBS homes located on ICF/MR campuses and
planned residential communities.
Response: We do not agree with the commenter. We believe the
requirements set forth in this regulation will support innovative
partnerships that support community integration and provide individuals
with maximum control.
Comment: One commenter recommended the rule apply a presumption of
``community-based'' if an individual has lived in an assisted living
facility for at least 12 months and is the only available alternative
to the institutional settings.
Response: We do not believe that the amount of time spent in a
setting should be used to classify the setting as home and community-
based.
Comment: Several commenters stated that while the concept of a
rebuttable presumption may be attractive in the abstract, the
commenters doubt that it can be operationalized effectively. The
commenters expressed concern that this will be done as an
individualized determination falling under ``we-know-it-when-when-we-
see-it.'' The commenters stated that providers need clear guidance
ahead of time, before the individual moves in and/or before the
provider develops property. A couple of commenters expressed concern
about the lack of guidance regarding rebuttable presumption and what
would constitute adequate rebuttal of the presumption. One stated that
the proposed rule already creates a set of requirements specific to
provider-owned and controlled residential settings receiving HCBS
funding, which effectively create heightened scrutiny for such
settings. The commenter also questioned what procedural safeguards will
be in place to allow appeals of decisions, who will make the final
determinations, what are the additional administrative burdens placed
on states and providers to add this additional layer of heightened
scrutiny, and if a setting meets an individual's needs and preferences
and meets the other criteria for home and community-based settings, who
should bear the burden of proof to demonstrate that a setting is not
home and community-based. Some commenters believe that the settings to
which the rebuttable presumption will apply should be explicitly
excluded rather than subjected to ``heightened scrutiny.''
Response: The regulation has been revised to make it clear that
states wishing to present evidence that such settings are home and
community-based may do so. Under such circumstances, we will engage in
heightened scrutiny in the course of the review of a SPA and/or the
state's transition plan of supporting documentation of this evidence to
make a determination that the settings do comply with the requirements
set forth in Sec. 441.530 and Sec. 441.710. This review will also
include assessment of how the settings allow for full integration into
the broader community. In addition to information provided from the
state, we also will accept information from stakeholders and other
third parties regarding whether such settings have the qualities of
being home and community-based and do not have the qualities of an
institution. We stress, however, that lacking strong evidence to the
contrary, we will presume the settings are not HCB.
Comment: One commenter indicated disagreement with the application
of a rebuttable presumption. Specifically, the commenter does not agree
with
[[Page 2970]]
housing arrangements that encourage spouses and family members to tie
their own housing to the institutional housing of the family member who
requires the most care, rather than encouraging the development of
innovative solutions for how individuals with various chronic and high
care needs may be housed in the most integrated settings. The commenter
also indicated that while it is tempting to cleanly differentiate
between the needs and wishes of senior constituents and the disability
community regarding this regulation, it does not take into account the
increasing numbers of people with disabilities who are aging, who must
be assured that they will not have any weaker protections around
gaining access to services and supports in a truly integrated community
setting.
Response: We appreciate the commenter's opinion. We believe our HCB
setting requirements are beneficial to everyone regardless of age,
condition or level of disability.
Comment: Several commenters suggest that rather than creating a
rebuttable presumption, CMS should state that the settings listed in
Sec. 441.530(a)(2)(v) and Sec. 441.710(a)(2)(v) are not home and
community-based even if these settings meet the requirements in
paragraph Sec. 441.530(a)(1) and Sec. 441.710(a)(1). The commenters
urged that one of the most important qualities of a home and community-
based setting is its location; a setting that is literally on the
grounds of, in, or synonymous with an institution cannot be home and
community-based.
Response: We appreciate the commenter's perspective. Such settings
are presumed to be institutional and not home and community-based.
However, we recognize that it could be possible for some of these
settings to operate in a manner that is consistent with the HCB
requirements set forth in this rule. Therefore, we will engage in a
formal review of such settings if the state would like to recognize
them as home and community-based settings under the applicable Medicaid
authorities.
Comment: One commenter suggests that if we retain the heightened
scrutiny of settings described in this section, then we should modify
the regulation to include an exception from the requirement if the
client, the client's designated representative and client's case
manager believe it is in the client's best interest to be allowed to
live in such a setting.
Response: We believe that individuals must have the opportunity to
receive services under 1915(i) in settings that support integration
with the greater community. Therefore, State plan HCBS must be
delivered in a setting that meets the HCB setting requirements as set
forth in this rule and since this authority provides states the
opportunity to provide individuals HCBS and not institutional services,
individuals must be living in settings that comport with the HCB
setting requirements as set forth in this rule. For settings that do
not meet these requirements, we note that there may be other Medicaid
authorities under which such services may be covered.
Comment: One commenter expressed concern that the presumptive
ineligibility of certain congregate settings and disability specific
housing may have a chilling effect on the development of innovative
service delivery approaches designed to meet the preferences of and
provide a wider array of options to people with limited income and
resources. For example, the commenter notes that continuing care
retirement communities (CCRCs) and dementia-specific assisted living
have been important options for older persons who want to plan for a
future in which increased disability is likely. But most of such
settings and services are very expensive--well out of the reach of
people who are likely to need Medicaid assistance. In response, some
innovative providers of subsidized housing are co-locating assisted
living settings on the same location or converting parts of their
buildings to assisted living. If such approaches would mean that these
settings were presumptively ineligible to participate in Medicaid HCBS
programs, it could have a chilling effect on developing such
innovations--effectively restricting them to those consumers who have
substantial resources. One potential solution would be to recognize
what the Fair Housing Amendments Act of 1988 has recognized in civil
rights law--namely that ``housing for older persons'' is desired by a
substantial number of people age 55 and older and that it is not
considered discriminatory. It is relevant to recall that assisted
living and CCRCs emerged largely as private pay options, reflecting
strong consumer demand for age-specific housing with services that
enable older people to live more independently than they would in a
nursing home. This history stands in contrast to state mental hospitals
or institutions for those with intellectual or developmental
disabilities, where state policies created segregated environments for
people with such disabilities. The history of age-specific housing with
service approaches also contrasts with the history of nursing homes,
which grew dramatically after the enactment of Medicaid with its
institutional funding bias. In correcting the history of state and
federal actions that have segregated people with disabilities, CMS
should not prevent the ability of older persons with low incomes to
access innovative approaches to housing and services that have
demonstrated strong consumer demand and are permissible under civil
rights law.
Response: It is not our intent to hinder innovative ideas for
future development of HCBS. Rather, we believe that the requirements
set forth in this regulation are a result of many comments we received
from stakeholders, including individuals receiving services. Thus, we
believe that developers and states should use this as a foundation as
they look at developing plans to provide long-term care services and
supports in their communities. We believe that this could be a tool to
assist states with adhering to the Olmstead mandate and the
requirements of ADA.
Comment: The commenters also requested that CMS clarify that it did
not intend to include such group homes located in and fully integrated
into typical neighborhoods or small community ICF/MR homes in the
definition of a ``facility that provides inpatient institutional
treatment.''
Response: It is possible that the setting described by the
commenter could be considered a home and community-based setting, if it
meets the requirements set forth at Sec. 441.530 and Sec. 441.710.
ICF/IIDs regardless of size are statutorily prohibited from being
considered a home and community-based setting, because they are
institutions under the statute.
Comment: Several commenters indicated that a setting should not be
disqualified based solely on physical proximity to an institution. One
commenter expressed concern this provision could force people into
nursing homes as the only financially viable option. Providers have
been encouraged to diversify and move into HCBS, including converting
portions of what would be considered ``institutional'' settings to
assisted living or other type of residential setting. Similarly, some
commenters believe that if a converted nursing home space meets the
requirements of Sec. 441.530(a) and Sec. 441.710(a) then there should
not apply a rebuttable presumption that the setting is not a home and
community-based setting.
Response: We appreciate the commenters' concerns. It is not our
intent to have individuals move into long term care facilities, when
their
[[Page 2971]]
needs could be met safely and adequately in a less restrictive
environment. Our experience has shown that settings in close proximity
to institutional settings, whether on the same campus, in the same
building, sharing the same staff, and perhaps sharing some common areas
are more likely to be operated in a manner similar to the institution.
They are often also similarly segregated from the larger community of
individuals not receiving Medicaid HCBS. Therefore, we strongly believe
in applying a presumption that such settings are institutional in
nature. However, we recognize that not all settings co-located, or
closely located with an institutional setting, exhibit the same
institutional characteristics. Therefore, through the applicable state
plan amendment process, states will have the opportunity to describe
how such settings meet the HCB setting requirements set forth in this
final rule and do not have the qualities of an institutional setting.
Comment: One commenter indicates that there is a strong incentive
for states, local government authorities, and providers to work
together to use existing segregated institutional locations. The
incentive falls toward keeping these properties fully utilized. These
incentives will not be easily overcome, and may well require an
outright prohibition on providing public funding to settings that share
the buildings or grounds of an institution that provides in-patient
care. A few commenters expressed concern with the effect this rule will
have on the commenter's state plan to rebalance its long term care
system. The state is currently seeking to ``right size'' the nursing
home bed supply. The driving force behind this initiative is to
rebalance the long term care system and provide an optimal level of
choice for the consumer. It would only be natural for long-term care
providers to participate in this right size initiative by utilizing the
state's successful model of affordable assisted living to create campus
settings that would provide a full continuum of long term care
services. Many nursing home providers possess land and existing
structures that could be used to develop managed residential
communities, individual homes or cottages, or other independent living
options where assisted living or home care services could be delivered
in accordance with an individualized person-centered plan.
Response: We recognize that repurposing existing building
structures is a tool used to control costs. However, we believe that
such structures should not be a state's first option when looking to
increase the pool of community-based residential settings. Such
structures were often built and operated in such a way that they
inherently hinder individuals from participating in the broader
community, and reduce individuals' control of how and where they
receive services. However, there may be circumstances where such a
setting could be repurposed in a way that it would meet the
requirements for HCB settings and would no longer have the
characteristics of an institution. The final rule allows a state to
submit evidence for CMS' consideration in this circumstance.
Comment: Many commenters requested Sec. 441.530(a)(2)(v) and Sec.
441.710(a)(2)(v) be modified to also include settings on the grounds of
or adjacent to a privately operated institution. These commenters noted
that a private institution is no less institutional than a public one
and should be treated the same for purposes of this provision.
Response: We appreciate the commenters' concern. It is expected
that all settings, public and private, meet the HCB setting
requirements of this regulation. We specifically make reference to a
setting that is adjacent to a public institution in the regulation
language due to public input. However, while we did not incorporate
this suggestion into the regulation, we note that heightened scrutiny
will be applied to any setting that hinders or discourages integration
with the broader community.
Comment: One commenter agreed that it is important to have rules
that circumvent practices such as building many group homes or
apartments on the grounds of institutions or on the property where an
institution once stood. However, the commenter believes the
requirements proposed go too far, as the standards would preclude
people from choosing to live in many neighborhoods that might be in
proximity to an institution, such as the VA hospital where they worked,
even if they live in proximity to other aspects of community living as
well.
Response: The presumption will be applied to settings that
discourage integration of individuals from the broader community. We
will describe these settings in future guidance and will take into
account the commenter's concerns about group homes on the grounds of an
institution that are recently closed. Regarding the concerns about
settings adjacent to VA hospitals, a residential setting that allows
individuals to have full access to community services, and allows for
active participation in neighborhood/community events, resources and
integrated activities, but is located in close proximity to a VA
hospital might meet the qualities for a home and community-based
setting and not the qualities of an institution.
Comment: A few commenters indicated that older persons often seek
out settings in which they can stay as they grow older and develop
service needs. A significant number of older persons prefer to live in
a senior community or similar setting that includes a nursing facility,
particularly when one spouse or partner needs nursing facility care and
the other does not. The commenter recommends that being on the grounds
of, or adjacent to an institution not be a disqualifying
characteristic.
Response: We will engage in discussion with any state who proposes
that such settings would meet the qualities for home and community-
based and not the qualities for an institution.
Comment: One commenter indicated that the Fair Housing Act contains
an exception that allows distinctions based on age, and believes this
rule should do so also.
Response: The purpose of this section of the regulation is to
define qualities for home and community-based settings. Since Medicaid
services are available to individuals of all ages, we do not believe it
is appropriate to create age-based distinctions.
Comment: One commenter believes that hospital-based providers
should not be allowable HCBS providers. The commenter also believes
that there should be two types of HCBS allowed for a non-hospital
entity to offer, even if they are provided on the grounds of a
hospital: (1) Services provided by an HCBS provider in the emergency
room before the patient is admitted to the hospital, and (2) Discharge
planning with a patient in a hospital or long term care setting in
order to help facilitate a more rapid, seamless, and coordinated
transition into community-based care.
Response: We recognize that while an individual is moving through a
state's overall service delivery system, there may be certain
circumstances in which services provided under various authorities may
overlap. Services should be provided as appropriate to meet an
individual's needs; however, it is incumbent upon the state to ensure
that there is no duplication of payment for the same services. A
provider of HCBS could provide services in the emergency room, as long
as those services are necessary and do not duplicate the services being
provided by the emergency room.
[[Page 2972]]
We believe it would be a best practice for there to be
communication between those settings and the program that will assist
the individual in the community. However, such communication should not
supplant the discharge planning activities that hospitals and long-term
care settings are required to perform for any individual leaving its
setting.
Comment: A few commenters requested the regulation define public
institution. One commenter requested clarification on the definition of
a public institution. Specifically the commenter wanted to know if
``public institution'' means an ICF/MR, or whether it also includes a
university, library or community care hospital. Another commenter
wanted to know if this provision presumptively excludes HCBS in
publicly funded housing for older persons if a nursing home happens to
be located on the same campus.
Response: The term public institution is already defined in
Medicaid regulations for purposes of determining the availability of
Federal Financial Participation (FFP). Section 435.1010, specifies that
the term public institution means an institution that is the
responsibility of a governmental unit or over which a governmental unit
exercises administrative control. Medical institutions, intermediate
care facilities, child care institutions and publicly operated
community residences are not included in the definition, nor does the
term apply to universities, public libraries or other similar settings.
We will apply this existing definition in implementing the provisions
of this final rule. However, we note that any setting that has the
effect of isolating individuals receiving Medicaid HCBS from the
broader community of individuals not receiving Medicaid HCBS will be
presumed to be a setting that has the qualities of an institution
unless the Secretary determines through heightened scrutiny that it has
the qualities of home and community-based settings. Thus, settings that
are located on the grounds of, or adjacent to, institutions that are
not defined as public institutions under the existing regulation will
still be subject to heightened scrutiny if such settings have the
effect of isolating or segregating those receiving HCBS from the
broader community.
Comment: One commenter expressed concern about the effect this
regulation will have on individuals living in continuing care
retirement communities (CCRC's). Another commenter believes that co-
location on a campus facilitates efficiency, reduces administrative and
food service costs, and potentially increases the quality of services
provided in the nursing home since the independent living residents
often visit their friends who reside in the CCRC's nursing home. The
commenter added that co-location facilitates seamless transition among
the various levels of care on campus. One commenter expressed concern
that the regulation would have a particularly negative impact on not-
for-profit long term care providers that more often provide services in
a multi-level campus setting because of their missions to meet the
multiple needs of the community.
Response: In general, CCRC's are a combination of residential
settings and care options that include independent living, assisted
living, and nursing home care. It is possible that currently the state
considers the independent living units to be home and community-based.
Nursing facilities are statutorily prohibited from being considered
home and community-based and is considered an institutional setting.
The independent living units and assisted living units would be
presumed institutional and receive heightened scrutiny if they are (1)
located in the same building as the nursing home or other facility
providing inpatient treatment; or (2) if they are located on the
grounds of, or immediately adjacent to, a public institution.
Comment: One commenter believes that excluding assisted living
facilities that are on the same grounds of an institutional facility
may be limiting the choices available to individuals. The commenter
believes that offering a variety of locations for community based
services better addresses the diverse population that receives these
services.
Response: Assisted living facilities are not excluded from being
considered home and community-based if they are structured and operate
in a manner that adheres to the requirements set forth in this rule.
Comment: One commenter requested that CMS clarify what is
``inpatient institutional treatment'' and asked whether ``provides''
means direct provision of services by the facility, any provision of
services in the facility, or facilitating the provision of such
services.
Response: Inpatient institutional treatment means that services are
provided 24 hours/7 days a week. Therefore, to avoid confusion, we have
retained the language ``inpatient institutional treatment.''
Comment: Many commenters believe the proposed regulations would
eliminate or severely restrict the provision of HCBS in programs
located adjacent to a public institution even though the program is
also adjacent to other buildings such as local community colleges and
universities, stores and businesses, and residential communities. Other
commenters indicated that proximity to an institutional setting should
not alone be the basis to disqualify a setting as HCB and stated that
many seniors choose to live in a community that offers a range of
settings.
Response: We believe that if the setting meets the requirements set
forth in Sec. 441.530(a)(1) and Sec. 441.710(a)(1), is not described
as prohibited under Sec. 441.530(a)(2) and Sec. 441.710(a)(2), and
does not exhibit qualities of an institutional setting, then the
services could be provided in settings like those to which the
commenters refer.
Comment: A few commenters expressed concern that the language in
the proposed regulation could be construed to prohibit the use of HCBS
to fund appropriate services on a campus that provides a variety of day
habilitation services and employment opportunities for individuals with
intellectual and related disabilities. For the commenters this would be
an unacceptable and radical policy change from the perspective of these
individuals and families who have relied on these services for years.
The commenters believe the location allows individuals to be part of
the community. The program is located adjacent to a residential
neighborhood and shares a parking lot with a college. The commenters
are concerned that if these longstanding programs are no longer
permissible for these individuals, their alternative would be
institutional placement. The commenters request the language ``adjacent
to'' not be included in the final regulation or that the interpretative
language accompanying the publication of the final regulation
explicitly clarify that the circumstances described above do not make
this type of program ineligible for HCBS funding.
Response: 1915(i) State plan HCBS and 1915(k) CFC services (for
example, residential, day or other) must be delivered in a setting that
meets the HCB setting requirements as set forth in this rule. We will
provide further guidance regarding applying the regulations to non-
residential HCBS settings. In addition, since this authority provides
states the opportunity to provide individuals HCBS and not
institutional services, individuals receiving 1915(i) State plan HCBS
or 1915(k) CFC services must be living in settings that comport with
the HCB setting requirements as set forth in this rule regardless of
whether they are
[[Page 2973]]
receiving HCBS in that residence. This is consistent with CMS'
longstanding policy regarding 1915(c) HCBS.
Comment: We received many comments both in support of and
opposition to the requirement that would have resulted in heightened
scrutiny over a disability-specific housing complex. The comments we
received on this provision are reflected as follows:
Several commenters recommend the regulation be revised to remove
``disability specific housing complex'' as a setting in which HCBS may
not be provided. The commenters believe that people with disabilities
should be able to choose to live in disability specific housing if the
housing addresses their needs. One commenter stated that being a
disability focused apartment building does not warrant the need for
extra scrutiny. There are significant differences between an
institution and a housing development.
Many commenters requested the rule clarify that the reference to a
``disability-specific housing complex'' was intended to refer to
settings located in a disability-specific housing complex--as well as
on the grounds of, or immediately adjacent to, such a complex.
Many commenters expressed concern that the proposed regulations
would eliminate or severely restrict HCB services to residents with
disabilities in supported living arrangements authorized under and
meeting the requirements of HUD Section 811 and Section 202 multi-
family housing units, because the homes built under HUD Section 811 or
202 are specifically restricted to people with specific disabilities.
They believe the proposed rule appears to conflict with HUD policies.
Several commenters believe that regulatory language will result in
the elimination of longstanding services that meet the needs of a large
number of individuals. The commenters recommended that CMS issue
interpretive guidance accompanying the final regulation to explain that
a program located in a building on the premises of a disability-
specific housing complex may receive HCBS if the housing complex is in
compliance with the underlying laws and implementing regulations,
including Section 811 of the National Affordable Housing Act of 1990,
as amended and implementing regulations (supported housing for persons
with disabilities), the Fair Housing Act, and the ADA.
Many commenters expressed concern that the use of the term
disability specific complex would eliminate or severely restrict the
provision of HCBS in group homes set around a courtyard where
individuals with disabilities have many needed services and supports
built into their day-to-day living and have transportation and other
assistance to access the general community.
Many commenters requested the regulation provide a definition of
the term ``disability-specific housing complex.'' Many commenters
believe that undefined, the term is unclear, and too broad.
Several commenters requested we clarify that ``CMS did not intend
to include group homes located in and fully integrated into typical
neighborhoods within the meaning of ``disability-specific housing
complex.''
A few commenters requested the rule clarify whether the presumption
that a disability-specific complex is not a home and community based
setting applies only if the setting does not meet the other criteria
established in the regulation.
One commenter believes the potential elimination of disability-
specific housing complexes as home and community-based settings will
compromise viable housing alternatives in a housing market that is
already in crisis, devastate the ability of providers to deliver
services in settings that promote health and safety, and force
individuals with developmental disabilities to move from their homes or
lose their services and supports.
One commenter expressed opposition to the heightened scrutiny level
of review, as proposed in the regulation. According to the commenter,
families believe their loved ones benefit from these settings. Some
planned residential communities are much like retirement communities
where amenities such as bowling alleys, theatre, community centers,
restaurants and shopping are readily available, along with necessary
health care, support staff, vocational training. The commenter further
stated that while the rule seems to embrace certain principles of
community, such as individual choice and person-centered planning,
there remains a bias that characterizes any sort of program-wide
structure and safety measures as too ``institutional'' without any
regard to the input of individuals, their families and their legal
guardians. This commenter also stated that given that there is already
a Medicaid definition of institution, it is improper for CMS to be
proposing an expansion of current Medicaid law redefining the term.
Another commenter believes that the proposed rule that considers a
``disability-specific housing complex'' an ``institution'' could be
confusing and a barrier to effective community housing options for
those with intellectual disabilities.
Many commenters objected to the inclusion of disability specific
housing as institutional in that many people choose, as a function of
age, to live with others with similar needs. The commenters indicated
that senior housing, assisted living, and other such options are freely
chosen by seniors without disabilities and inquired why people with
disabilities who are eligible for HCBS be denied the same array of
options available to their peers without disabilities. The commenter
noted that the key is that the person-centered plan should provide for
individuals making free choices in where they live as long as they do
not include nursing facilities, institutions for mental diseases,
intermediate care facilities for mentally retarded, hospitals, or other
locations that have the qualities of an institutional setting as
determined by the Secretary. Other commenters suggested that seniors
often choose to live together in a variety of settings and request that
CMS respect this preference by establishing exemptions from the
proposed setting requirements for continuing care campuses, assisted
living settings, and other housing for older persons. The commenter
stated that CMS should not preclude successful options for people with
disabilities simply based on location or proximity. Alternatively, one
commenter indicated that he does not have the same philosophy and
asserted that this provision must remain in these regulations. This
opinion is based on the commenter's experience with the
deinstitutionalization of people with intellectual and developmental
disabilities and the commenter's knowledge of recent efforts in certain
states to try and use waivers to fund settings that do not promote full
inclusion in community life. If CMS does decide to create an exception,
the commenter urges we keep it very narrowly tailored to senior
communities only, so that it cannot be used to limit the opportunities
of people with intellectual and developmental disabilities to
experience true integration.
A few commenters requested the regulation clarify if housing or
units within general housing, designated for persons with dementia or
other cognitive impairments would meet the definition of disability-
specific housing complexes. Other commenters added that it is
discriminatory to deny HCBS waivers to individuals residing in an
Assisted Living Facility providing care specifically to those with
Alzheimer's
[[Page 2974]]
and dementia just because of where they live.
Response: As a result of comments we received on the use of the
term disability specific-complex, we have revised the rule to remove
the term ``disability-specific housing complex'' and replace it with
the following language: ``any other setting that has the effect of
isolating individuals receiving Medicaid HCBS from the broader
community of individuals not receiving Medicaid HCBS[hellip]'' We note
that we are not redefining the term ``institution'' but rather defining
what characteristics we will see as institutional and not HCB in
nature. We plan to issue future guidance to provide examples of the
types of settings that will be subject to heightened scrutiny.
Comment: One commenter shared the opinion that disability-specific
housing complexes are established for the convenience of service
providers, or because the developer believes that people with
disabilities should be segregated, or both. The commenter further
explains that disability-specific housing complexes are not integrated
at all, and therefore certainly not the most integrated setting
appropriate to anyone's needs. The commenter recommends that they must
not be included as home and community based settings.
Response: We appreciate the commenter's perspective. We do not
believe that all settings should be excluded; however, we do believe a
close review of such settings may be necessary.
Comment: Many commenters indicated that if the rule is finalized
with application of a rebuttable presumption then it should only apply
to disability-specific housing complexes. The commenters recommended
that CMS should specify that the presumption may be rebutted only when
(1) the setting meets all of the requirements for home and community-
based settings in Sec. 441.530(a)(1) and Sec. 441.656(a)(1), and (2)
the setting was selected by the individual following a meaningful
opportunity to choose from among alternatives, including the most
integrated setting for the individual as documented in the person-
centered service plan.
Response: We do not agree with the commenter's recommendations.
Section 441.530(a)(2)(v) and Sec. 441.710(a)(2)(v) have been revised
to better articulate the settings that are presumed institutional in
nature and will receive heightened scrutiny to determine if they can be
considered home and community-based settings.
Comment: One commenter believes the rebuttable presumption language
also applies to settings where there are specialized services for
individuals with similar diagnoses. Many of these programs were
designed, developed and chosen by consumers to reflect new standards of
care and treatment. The commenter urges CMS to change the language in
the rule to reflect this model of care and not limit these programs to
only non-Medicaid persons.
Response: We recognize that there are many forms of settings and
service delivery models serving individuals with a need for long term
care services and supports. Due to this variability across the country,
we do not believe it would be best to carve out certain models in this
rule.
Comment: Many commenters were concerned about the effect the
proposed rules would have on settings specifically designed for
individuals with autism. The commenters stated that many of these
individuals failed to thrive in both institutional and totally
independent settings, but they do thrive in certain non-urban community
based models. The commenters believe the proposed rule ignores the
community based nature of these models and inaccurately and
unreasonably categorizes these settings as institutions. One commenter
believes the proposed regulations will cause downsizing and elimination
of public and private specialized residential facilities for persons
with severe and profound cognitive-developmental disabilities
Response: We believe that settings that are designed to prevent an
individual from having the opportunity to participate in the broader
community are not home and community-based. We believe that
individuals, regardless of service need, can benefit from having the
opportunity to participate in the broader community. The goal of this
regulation is not to take services from individuals, or make
individuals move from a location where they have always lived, but to
describe the qualities of settings in which services intended to
provide an alternative to institutional care may be delivered. The goal
of this regulation is to widen the door of opportunity for individuals
receiving Medicaid HCBS to support the same choices to participate in
community activities as are available to individuals not receiving
Medicaid HCBS; to have a choice in how, when, and where they receive
services; and to remove unnecessary barriers and controls. We believe
that the Medicaid program provides many options for states to develop
delivery systems that meet the needs of individuals regardless of where
they fall on the continuum of care.
Comment: A few commenters expressed the belief that individuals
with severe cognitive impairments should be allowed to live together,
because the commenters believe that this is not a population that can
benefit by integration within the community at large. The commenter
stated that special programming and physical plan improvements for this
population have contributed to increased quality of life and quality of
care for this population. The commenters request the rule be amended to
allow individuals with cognitive impairments to live together and that
this not be considered disability-related segregation.
Response: We disagree with the commenter in part. We agree that
individuals benefit from services that are specialized and tailored to
meet their specific needs. However, we firmly believe that all
individuals regardless of type or degree of disability would benefit
from opportunities for community integration if it is their choice to
live in the community and not an institution. We note that Medicaid
continues to provide other service options that can support individuals
who choose to receive services in non-HCB settings.
Comment: One commenter believes the proposed changes to the rules
would prevent an individual from making a choice to live in a rural
agricultural community setting with several homes on the property. The
commenter requested the rules be revised so that every person with
every type of disability is given a choice that would meet the
individual needs and unique characteristics of the person.
Response: Under the requirements of this regulation, for a setting
to be home and community-based, it may not discourage an individual's
integration with the broader community. The determination would not be
based on whether the setting was in a rural, urban, or suburban
community, but on whether it has the qualities of home and community-
based settings as specified in this rule.
Comment: One commenter indicated that in their state, there is the
option for individuals to choose fully accessible individual apartments
and accessible complexes that are disability-specific housing settings
located in community neighborhoods that provide quick response and 24-
hour onsite coverage. The commenter stated that the number of these
settings has grown and consistently includes waiting lists, and to
eliminate these settings for Medicaid
[[Page 2975]]
HCBS recipients unfairly limits their choice.
Other commenters expressed concern that many seniors living in age-
specific communities will inadvertently be prohibited from receiving
HCBS due to proximity to a hospital or nursing facility. The rule, they
believe, will lead to more nursing home admissions among seniors and
limit choices available to them to receive services in an assisted
living facility (ALF). The commenters also stated the proposed language
would likely reduce the number of individuals in nursing homes who are
able to transition to a more integrated setting, because many
individuals transition to ALFs. It should be considered desirable that
those served by Medicaid would have the same array of choices as those
not on Medicaid.
Response: We have removed the references to disability-specific
housing in the text of the final regulation. However, if the settings
have the effect of isolating individuals receiving Medicaid HCBS from
the broader community, we will apply heightened scrutiny to these
settings to determine if they meet the required qualities for a home
and community-based setting as set forth in this rule. The State could
present information to CMS to demonstrate that the settings have the
qualities of community-based settings.
Comment: Several commenters supported the language as written,
stating appreciation that CMS has clarified that the term ``community''
refers to the greater community and not solely a community of one's
peers and, that integration also means more than integration in a
community of peers. They further stated that focusing on the purpose of
HCBS helps define its characteristics. A few commenters agreed that a
home and community setting should facilitate individuals' full access
to the greater community as they choose, including in the areas noted.
However, the commenters noted that individuals may vary in their
choices as they seek full access to and participation in the greater
community, and a home and community-based setting should facilitate
such full access consistent with an individual's choices and
preferences. The commenters recommended adding the following language
related to access ``based on the individual's needs and preferences.''
Another commenter stated the belief that the language is very broad and
ambiguous and should be defined along with ``the greater community.''
Another commenter requested that we define ``community'' and suggested
the language parallel the language used under the section pertaining to
person-centered service plan, stressing that individuals should be
given the right to obtain services ``from the provider and the
community of his or her choice.''
Response: We support individual choice and agree that individuals
may vary in their choices as they seek full access and participation in
the greater community. However, in order to receive approval of a State
plan under which it will receive Medicaid funding for HCBS, a state
must ensure that the choices available to individuals meet the
requirements for community integration at Sec. 441.710 of the final
rule.
Comment: Some commenters expressed concern with the requirement as
proposed at Sec. 441.530(a)(1)(i) that the setting must permit access
to the greater community ``in the same manner as individuals without
disabilities.'' One commenter stated that it would be more appropriate
to require access ``to the same extent'' and that this language will
give HCBS providers reasonable flexibility in regards to making
accommodations for disabilities and to avoid disputes and possible
litigation on the exact manner in which such accommodation must be
provided. Other commenters indicated that this requirement is not
measurable and may reduce choice for rural populations.
Response: After significant consideration, we have removed from
Sec. 441.530(a)(1)(i) ``in the same manner as'' from this requirement,
and replaced it with ``to the same degree of access as,'' to best
describe our intent to ensure access to the greater community that
includes individuals with and without disabilities.
Comment: One commenter stated that licensed facilities may be
located in both urban and rural settings resulting in variation with
the amount of ``integration'' available. The settings are chosen with
this in mind, and one that seems to be less integrated to CMS may be
preferred by some over living where it appears participation in
community activities is greater.
Response: We agree that there is a large degree of variance
regarding the geographical settings where licensed homes are located.
We agree that an individual should be able to exercise choice in regard
to these settings. We do not express preference in regard to the
proximity of activities to where an individual lives; the emphasis is
on access to those chosen activities and whether the individual has the
same degree of access to such activities as individuals not receiving
Medicaid HCBS.
Comment: One commenter believes that CMS should not disqualify any
setting from receiving federal financial participation (FFP) solely
based on the fact that it is a congregate setting.
Response: It is not our intention to exclude a state from receiving
FFP for a setting solely based on the fact that it is a congregate
setting. Our intention is to specify qualities necessary for a setting
to be considered a HCB setting. Congregate settings may be included if
they meet the HCB setting requirements set forth in this rule.
Comment: Several commenters stated that a service provider (for
example, a job coach), not a setting, facilitates employment-seeking
opportunities. Similarly, a service provider, not a setting, assists
individuals in managing what few disposable resources are available to
them. One commenter seeks clarification regarding what facilitating
``full access to . . . employment opportunities'' entails and what
possibilities, if any, would be imposed on the housing provider. One
commenter supports the concept of community integration, but believes
CMS has blurred the distinction between the setting and the service
provider. One commenter believes that CMS is wrong to assume that
location will enforce the goals of integration, for example, social
interaction, productivity and competitive employment. The commenter
further notes that having the ability to access the general community
is very different from being forced to live in a community ``setting''
that is not only unwilling, but unable to provide resources for safety,
supports, interaction, social integration and employment in competitive
settings. One commenter encourages CMS to ensure that the settings in
which residents receive services are designed to facilitate the actual
integration of the recipients into the surrounding community.
Response: We agree that it is the responsibility of the service
provider rendering the services and therefore we have added language
under person-centered service plan requirements to ensure a clear
understanding of our expectation. We believe the section on person-
centered planning clarifies CMS' expectations with regard to services
being delivered in a manner that promotes/supports community
integration to the extent of the individual's preferences and desired
outcomes.
Comment: Several commenters expressed strong support for the
setting integration provision, but recommended modifying Sec.
441.530(a)(1)(i) to specify that the employment-related provision apply
only to those individuals who are interested in being employed. They
[[Page 2976]]
recommended modifying Sec. 441.530(a)(1)(i) by adding the following
language ``for those individuals interested in being employed''
following the words ``integrated settings.'' Another commenter
recommended the following revision to Sec. 441.530(a)(1)(i): ``For
individuals seeking to enter the job market, the setting should include
opportunities to seek employment and work in a competitive integrated
setting. For all individuals, the setting should permit them to engage
in. . . .''
Response: We believe that individuals should be supported in
seeking employment when interested in being employed and that the
statement ``opportunities to seek employment'' implies choice. In
addition, we believe that adding the suggested language to the
regulation text is unnecessary.
Comment: One commenter offered support of CMS' general approach of
identifying the characteristics of integrated care, but suggested that
CMS will need to take an active monitoring role to ensure that all the
individual quality requirements are enforceable.
Response: States are required to demonstrate at the time of
approval that quality measures with a monitoring plan are in place.
This information must be included in the SPA and at a frequency to be
determined by us or upon request by us. The review and monitoring of
quality requirements will be covered in future guidance.
Comment: One commenter stated that, it would be unpatriotic to
curtail any services in a manner that would adversely affect humans
with limited abilities.
Response: It is not our intention to negatively impact any
individuals we serve. Rather the purpose of the rule is to ensure that
states will be better able to design and tailor Medicaid services to
accommodate individual's needs and preferences.
Comment: Commenters stated that all people need meaningful choices
about where and with whom they live, how they spend their time and
their activities, friends, and services (including who provides them).
Permitting individuals the freedom to make their own choices allows
them to remain as independent as possible. One commenter applauded
efforts that focus on the individual's ability to choose his or her own
life setting and one that promotes community rather than institutions.
Several commenters noted that while providers may make different
choices than the client and have a different perspective, the provider
must respect and honor the choices and autonomy of people with
disabilities. One commenter supports the proposed language as long as
it provides assurances that real alternatives exist. Additionally,
another commenter recommends reinforcing the idea that states should
provide unbiased and informed options counseling for individuals
seeking HCBS so that individuals are able to choose the setting that
best assists them in meeting their needs and life goals.
Response: We agree that meaningful choices that allow individuals
to make decisions that best meet their needs are important. In
addition, they should be addressed as part of the person-centered
planning process and reflected in the individual's person-centered
service plan.
Comment: One commenter stated that the proposed regulation would
eliminate or at least severely restrict client and family choice of
program options and opportunities and that consumers and families need
more options, not fewer during these difficult times. Several other
commenters expressed serious concern that the proposed regulation will
eliminate instead of enhance choice for individuals with significant
disabilities.
Response: We disagree. We are not eliminating the choice of
institutional options. We are specifying the qualities necessary for
settings to be considered home and community-based settings.
Comment: Many commenters stated the proposed language in Sec.
441.530(a)(1)(ii) and Sec. 441.656(a)(1)(ii) should be modified to
more closely reflect the tenets of the ADA and the Olmstead decision by
including additional language that conveys the individual's choice of
setting must be an informed choice, based on more than verbal
descriptions or pictures of alternatives. Modifications should include
language that permits individuals a meaningful opportunity to choose
from among all available alternatives. Commenters conclude that the
level of specificity with which a particular setting must be identified
in a service plan is not clear and the requirement could
inappropriately prevent individuals from receiving services when their
desired living setting is specifically identified in a service plan.
Response: We believe the final regulation language supports these
principles. Within future guidance, we will reinforce the importance of
complying with other federal requirements such as ADA and Olmstead.
Comment: One commenter recommends striking the word ``available''
from Sec. 441.530(a)(1)(ii) and Sec. 441.656(a)(1)(ii) of the
proposed regulation. The commenter believes that this word could limit
choices of HCBS settings offered to individuals and offers the example
of long waiting lists for certain section 1915(c) HCBS waiver programs/
settings not being considered and reflected in the person-centered plan
due to lack of availability.
Response: We have revised Sec. 441.530(a)(1)(ii) pertaining to CFC
settings and the final regulation text at Sec. 441.710(a)(1)(ii) and
we have removed the term ``available.''
Comment: One commenter was supportive of this language as written.
Another commenter supported CMS' proposed list of essential personal
rights in this section. The commenter stated that, in addition to
freedom from coercion and restraint, people with disabilities in a
community setting should have the freedom to pursue their sexuality,
voting, and worship. In addition, a community setting should not be
permitted to restrict access to the community as a form of punishment.
Response: We are concerned that one of the commenters believes we
have provided a comprehensive list of rights. The factors related to
determining whether settings are home and community-based and the
description of the rights that individuals must have in these settings
are not intended to be an exhaustive list of all legal rights of the
individual. Individuals have many other legal rights not addressed in
this regulation. For example, civil rights against various forms of
discrimination are protected under the ADA and elsewhere. We regularly
work with the HHS Office for Civil Rights, Department of Justice (DOJ),
and others to assure that we provide appropriate guidance and
assistance to states related to civil rights issues that bear on
Medicaid requirements.
Comment: Many commenters stated that the inclusion of ``essential
personal'' may create confusion and suggest that the term be omitted
from Sec. 441.530(a)(1)(iii) to more clearly demonstrate intent to
protect the individuals' human rights. Several commenters indicated
that they strongly agree that these important personal rights should be
protected. However, as currently written the placement of ``essential''
may imply that other rights are not essential and thus do not need to
be protected. These commenters recommended removing the term
``essential'' from this paragraph.
Response: We agree with the suggested revision to Sec.
441.530(a)(1)(iii) and have finalized the provision at Sec.
441.710(a)(1)(iii) by removing the words ``essential personal.''
[[Page 2977]]
Comment: One commenter generally supports the proposed language,
but recommends that CMS delete the reference to restraint and/or
provide an exception when the individual has a documented history of
risk of elopement or susceptibility to behavioral flare-ups that can
only be controlled by temporary restraint.
Response: We disagree with the recommendation as this is an
important protection.
Comment: Several commenters supported the protection of
independence and the autonomy of individuals in making life choices.
One commenter stated that the post-rulemaking implementation must
ensure that the intent of the proposal is carried out in practice.
Another commenter generally supported the proposed concept, but noted
that the life choices principles are dictated by the service provider
and not the setting.
Response: The State Medicaid Agency will be responsible for
ensuring that the HCB setting requirements are met by providers who own
or control settings where individuals reside and/or receive services.
Comment: Some commenters stated that the language may potentially
result in limited choice, scattered living proposals, limiting staffing
resources and increasing costs associated with some individuals
choosing to live secluded from others with disabilities. The commenter
stated that individuals make choices that increase their independence
(within the resources that are provided through Medicaid) based on
informed experiences to ``live and play'' with others who are
developmentally disabled because they have much in common. Another
commenter disagreed with this proposed requirement and believes that
individuals should have the right to choose where they want to live.
Commenters stated that one size does not fit all and that different
populations have differing needs. Commenters supported an individual's
right to choose to reside in a living arrangement that best suits his/
her needs. The commenter also stated that this proposed requirement
would eliminate important options that now contribute to the array of
settings available to adults with disabilities and the elderly and the
move to a more restrictive setting would ignore the participant's
choice, diminish the participant's quality of life and increase costs
to Medicaid.
Response: We believe that individual choice is important and we
have worked to promote choice in the final rule, though we also
acknowledge the challenge of doing so in a manner that addresses the
interests of diverse populations with differing needs. We have revised
the language in the final rule to be more flexible and less
prescriptive. Instead of automatically excluding certain settings from
qualifying as HCB, the language in the final rule includes a
presumption that these settings are not HCB. In other words, we will
assume that certain types of settings--specifically, those located in a
building that is also a publicly or privately operated facility that
provides inpatient institutional treatment, on the grounds of or
immediately adjacent to a public institution, or any other setting that
has the effect of isolating individuals receiving HCBS from the broader
community--are not HCB, but afford states the opportunity to refute
this categorization by providing additional information about the
characteristics of specific settings. We have also included language in
the final rule that focuses on the critical role of person-centered
planning and addresses fundamental protections regarding privacy,
dignity, respect, and freedoms.
Comment: Several commenters recommended that CMS delete the phrase
``and not regimented'' from the proposed language. The commenters
expressed concern that under the proposed language, group programming
could be viewed as ``regimented'' because it is provided in a
congregate setting. One commenter noted that structured activities and
socialization opportunities could be deemed inappropriate under the
proposed language since they may be provided in a uniform manner.
Response: We disagree with removing this language from the final
rule. We do not intend to invalidate all activities in a congregate
setting. Individuals must be afforded choice regarding the activities
in which they wish to participate including whether to participate in a
group activity or to engage in other activities which may not be pre-
planned.
Comment: One commenter recommended adding the following language to
this provision of the rule: ``(iv) Individual initiative, autonomy, and
independence in making life choices, including but not limited to,
daily activities, physical environment, and with whom to interact are
optimized to the greatest extent possible and not regimented.'' One
commenter recommended that CMS clarify that the term ``optimized''
refers to the individual's autonomy and does not refer to optimizing
the institution's promotion of autonomy. Another commenter requested
that CMS clarify who will determine and how to determine whether the
individual initiative, autonomy, and independence in making life
choices were optimized.
Response: We do not believe that ``to the greatest extent
possible'' adds significantly to the term ``optimized.'' We believe the
commenter's concern about referencing individual autonomy is addressed
in the regulation language. There are a number of methods inherent in
the flexibility of the HCBS benefits to determine who and how the
individual's initiative, autonomy, and independence are optimized.
Comment: Many commenters stated that an individual's choice
regarding services and supports and who provides them is a key element
of HCBS and, thus, must be ensured. Some commenters suggested
substituting the word ``ensured'' in place of ``facilitated.'' One
commenter stated that the word ``facilitated'' establishes a weak
standard and should be replaced with ``maximized.'' Another commenter
suggested that individuals be given choices about when services are
provided and recommended deleting ``is facilitated'' and replacing it
with ``is honored'' for further assurance. One commenter stated that an
individual's choice must be ensured, meaning ``made certain or safe''
and stated that in a home and community-based setting, personal choice
should not only be brought about, but is safe. Another commenter
expressed concern that ``is facilitated'' is not used to water down
individuals exercising choice over services, supports, and providers.
The commenter stated that some individuals may need assistance in
exercising choice and the commenter suggested revising this criterion
to note that support should be provided, as needed, to facilitate such
choices and to acknowledge that an individual's chosen representative
may be acting on behalf of the individual.
Response: After consideration of the commenters' thoughtful
suggested text changes, we believe the proposed text/language reflects
the intent of the provision.
Comment: Several commenters indicated that provider owned or
controlled settings licensed by state law have requirements that make
them responsible for the well-being of the resident and restrictions on
who (in addition to the licensed provider) can provide services in the
setting. Commenters stated that residents' rights allow for individuals
to supplement existing services provided by the providers, but not
replace them. Several commenters recommended revisions to
[[Page 2978]]
this section of the rule and some of the commenters suggested that
language be included to reference state licensure laws and licensing
entities.
Response: We disagree with the suggested changes. Some of these
were too descriptive to include in regulation and could have the effect
of excluding numerous populations served through HCBS programs. We will
instead consider these suggestions in future guidance.
Comment: One commenter requested that the rule clarify how a
person's choice about the type of services they want and who they want
to provide them ``is facilitated.'' The commenter suggests this can be
done by clarifying the qualifications that the facilitator must
possess--for example, the facilitator must be knowledgeable of all
community-based options (not only those that are considered readily
available) and must be able to present options in a way that is
accessible and is sensitive to the person's disability-related
communication needs.
Response: States are responsible for determining the provider
qualifications of the entities who will conduct the assessments and
person-centered planning process as long as the requirements in the
final regulations have been met. It is expected that these entities
would have adequate training to perform this function. We agree that
additional guidance should be provided to states and we intend to issue
future guidance regarding the person-centered process and how we intend
to apply it across Medicaid HCBS programs.
Comment: Several commenters supported the additional conditions
stating that they are critical to ensuring that provider-controlled
settings designated as home and community-based operate in a way that
promoted choice, autonomy and independence.
Response: We appreciate this comment of support regarding the
importance of the additional conditions.
Comment: One commenter generally supported the provisions but
suggested that the language include ``health needs'' in addition to
``safety needs'' and that the term ``dementia'' be changed to
``cognitive impairment'' to include individuals with severe mental
illnesses, traumatic brain injuries, and developmental disabilities, as
well as Alzheimer's and other forms of dementia.
Response: The reference to dementia was only included as an example
and was not meant to convey all of the possible situations in which a
modification of the conditions might be supported by a specific
assessed and documented need. We have, therefore, removed this example
from regulation text as this is more appropriate for us to address in
future guidance, and we will consider these comments in that context.
Comment: Several commenters strongly agreed with the proposed
language requiring that should a provider choose to modify conditions,
changes must be supported by documentation in the person's service
plan. Another commenter expressed support of CMS' efforts to allow
necessary flexibility to address individual circumstances in provider-
based settings, but urged CMS to allow flexibility in interpretation of
the language, ``specific assessed'' need. Two commenters also expressed
concern over this language, noting that in some instances residents may
require services based on overall condition rather than a specific
assessed need and suggested revision to this subsection of the rule.
Response: We acknowledge and appreciate support of the requirement
that any modification of the conditions for provider-owned or
controlled residential settings must be supported by a specific
assessed need and documented in the person-centered service plan.
However, we disagree that such modification would be acceptable based
on a condition that does not also result in a specific assessed need of
an individual. Allowing for modifications based on a condition that is
not also supported by a specific assessed need and documented in the
person-centered service plan could result in decisions being made based
on global assertions as opposed to individual need, and thus be
contrary to the purpose of this section of the rule. Therefore, we have
not made the requested revision to this requirement.
Comment: Several commenters stated that modifications must be
related to a clearly established assessed need and recommended a change
to the proposed rule so that the requirements must apply to all
settings where services are provided, regardless of whether or not they
are controlled by the service provider.
Response: We agree that any modification of additional conditions
must be based on the specific assessed need of the individual. The
regulation includes qualities that apply to all home and community-
based settings, but we disagree that the additional requirements for
provider-owned or controlled settings must be required of all settings
where services are provided, regardless of whether or not they are
provider-owned or operated. The additional conditions were designed to
ensure that individuals who are living in settings in which the
individual does not have ownership or control, will be afforded the
same opportunities and community access as individuals living in their
own private or family homes.
Comment: One commenter recommended that States should be able to
detail their own policies and practices to address rights and
restrictions as part of their application for HCBS authority, an
expectation currently embedded in the waiver application but not in
regulation.
Response: We disagree that states should detail their own policies
to address rights and restrictions. Based on our experience and on
input received from the public, we believe we must set these minimum
additional conditions to ensure individual rights are protected.
Comment: Several commenters stated that CMS should take into
account the differences between different disabilities in determining
when departure from the additional conditions may be permitted. These
commenters stated that, if CMS allows for the modifications to provider
requirements, CMS should require that the restrictions be directly
proportionate to a specific safety need and be reviewed for
effectiveness and continuing need.
Response: Any modifications of the conditions can only be
considered on an individual basis in accordance with the person-
centered planning process and documented in the person-centered service
plan in accordance with section 441.725.
Comment: One commenter recommends adding a component whereby direct
feedback is gathered from the beneficiary or the beneficiary's
representative regarding initial and ongoing overall satisfaction with
the modification of conditions.
Response: The rule has been modified to require that any
modification to the additional conditions under Sec.
441.710(a)(1)(vi)(A) through (D) must have the informed consent of the
individual (or representative).
Comment: One commenter stated that a modification may be needed to
reflect the involvement of an individual's representative, as
appropriate, when individuals are unable to act on their own behalf.
Response: The regulation already specifies the involvement of an
individual's representative in the evaluation of eligibility (Sec.
441.715), independent assessment (Sec. 441.720), and person-centered
service plan (Sec. 441.725). The regulations also include a definition
for individual's representative in section 441.735 of this subpart.
Since any modifications of the
[[Page 2979]]
conditions would need to comply with the requirements for these
processes, we do not believe that modification to the regulation text
is needed.
Comment: We received some comments related to the difficulty of
achieving compliance with the proposed requirements. A few commenters
expressed concern that the conditions for provider-driven settings
might exclude assisted living residences (ALRs), as it remains unclear
whether they would meet the proposed criteria. Another commenter
expressed great concern that privately-owned residential settings that
have proven successful in their state would not qualify under the
proposed guidelines since many would not provide separate kitchens or
sleeping and living areas. Another commenter stated that this
regulation severely restricts program options and opportunities because
of the impact the regulation has on HUD financed housing owned by
providers, and that this regulation would restrict the use of HCBS
waiver funding for services provided in these settings.
Response: We believe there will be residential settings that meet
the HCB requirements as outlined in this regulation. However, we
recognize that there may be some residential facilities that may not
currently meet all of the HCB setting requirements for provider-owned
or controlled settings. We will allow states a transition/phase-in
period for states to demonstrate compliance with the requirements. In
an effort to balance those comments that were concerned with the loss
of a residential setting and the subsequent displacement of the service
recipient based on the settings requirements and those comments that
urged us to draw an immediate and clear demarcation for HCBS, our
expectation is that the transition plan would facilitate a brief
transition period wherever possible. However, we will afford states the
opportunity to propose a transition plan that encompasses a period up
to five years after the effective date of the regulation if the state
can support the need for such a period of time. States are expected to
demonstrate substantial progress toward compliance throughout any
transition period.
Comment: One commenter expressed concern that the proposed language
requires full participant direction even when such direction may not be
appropriate for certain populations.
Response: Self-direction is an optional service delivery method,
not a federal home and community-based setting requirement in the
proposed or the final rule.
Comment: Many commenters indicated that the proposed language
provides an unchecked and overbroad right for a service provider to
modify any of the requirements, as long as the modification is
supported by an assessed need and documented in a service plan. The
commenters stated that CMS should allow modifications of the
``additional conditions'' only in rare and extraordinary circumstances,
and then only after a provider has documented that less intrusive
measures have already been tried, data has been collected on the
modification's effectiveness, and the need for the modification has
been reviewed at least quarterly. Many commenters stated that allowable
modifications should be limited to the requirements pertaining to
access to food and lockable doors. Several commenters stated that the
only appropriate reason to modify any of the listed conditions would be
to address safety needs, and several recommended a revision to this
subsection of the rule. However, other commenters stated that there is
no reason for an exception/modification under any circumstances for
many of the requirements and have recommended revisions to the
regulation.
Response: We agree with the commenters that the basis for
modifications should be justified through the person-centered planning
process. The service provider does not lead the person-centered service
planning process; it is driven by the individual and includes people
chosen by the individual. We have revised the rule to require that any
modification to the additional conditions under Sec.
441.710(a)(1)(vi)(A) through (D) must be supported by a specific
assessed need and justified in the person-centered service plan. We
also delineated specific requirements to support that justification as
well as expectations for the intervention.
Comment: Several commenters asked how frequently the assessment
must be made if the condition causing the modification of the
``additional conditions'' was not likely to improve. One commenter
recommended that CMS amend the current language to clarify that the
specific assessed need must be of the individual, and should indicate
that a determination has been made regarding the timeframe that the
modification of conditions will be in effect.
Response: Per the response to the previous comments, we have
revised the rule to require that any modification to the additional
conditions under Sec. 441.710(a)(1)(vi)(A) through (D) must be
supported by a specific assessed need and justified in the person-
centered service plan. We also state in the rule that reviews and any
needed revision of the independent assessment and the person-centered
service plan, must occur at least every 12 months, when the
individual's circumstances or needs change significantly, and at the
request of the individual.
Comment: Several commenters stated that CMS should not allow any
departures from or modifications to the conditions.
Response: We disagree as there may be reasons why a modification of
the conditions may be necessary.
Comment: One commenter offered general support of the proposed
language's intent and believes that the ``legally enforceable
agreement'' condition should never be limited, or modified.
Response: We appreciate the commenter's support and concern. While
the final rules maintain the ability for a provider to modify this
condition, we have added that this must be supported by a specific
assessed need and justified in the person-centered service plan and
delineated specific requirements to support that justification.
Comment: Several commenters stated that CMS should clarify that all
settings in which the individual does not have a regular lease or full
ownership (including adult foster care settings) be considered
provider-controlled.
Response: For the purposes of this rule, a setting is considered
provider-owned or controlled, when the setting in which the individual
resides is a specific physical place that is owned, co-owned, and/or
operated by a provider of HCBS.
Comment: Several commenters suggest that CMS clarify that all
settings that require individuals to automatically transfer their
income to service providers for the purpose of SSI/SSDI or other
disability payments are not HCB settings for purposes of the Medicaid
program.
Response: Room and board is not covered under Medicaid state plan
HCBS. This rule does not specify how payment for room and board should
be made.
Comment: One commenter expressed that all requirements listed for
provider-owned or controlled settings should be a part of the final
rule. The commenter also indicated concern that the example given in
the rule creates the impression that addressing safety needs of persons
with dementia is only one of many possible examples of how conditions
might be modified.
[[Page 2980]]
Response: This was only intended as one example of this provision
and is not depicting a full range of possible situations. To avoid
confusion, and to clarify that person-centered planning is based on the
person and not on his/her diagnosis, we have deleted this example from
the regulation text.
Comment: One commenter stated that, in addition to the provisions
at Sec. 441.530(a)(1)(vi) and Sec. 441.530(a)(2)(v), other provisions
can be used to ensure that the settings in which residents receive
1915(k) CFC services are designed to facilitate the actual integration
of the residences that are provider-owned or controlled for providing
residential support to recipients.
Response: We agree with the commenter. For a setting proposed under
1915(k) CFC to be determined home and community-based, the setting must
meet all requirements set forth in Sec. 441.530.
Comment: One commenter urged CMS to give serious consideration to
striking the ``conditions for provider-driven setting'' provision. The
commenter stated that though the rules attempt to create a homelike
environment by proposing conditions, no reasonable person would accept
these conditions as homelike. In addition, the commenter stated that
regardless of the size of a provider controlled setting, the very
nature of these environments isolates, congregates and segregates the
individuals living there, and limits personal freedom.
Response: We disagree. We believe there are provider-owned or
controlled settings that not only meet the overall HCB qualities but
also meet the additional conditions and allow for full integration into
the community; therefore, we will keep the conditions to ensure the
standards for HCB settings are met. We believe the commenter's request
to delete the conditions for provider-controlled settings would not
accomplish the suggested purpose.
Comment: Several commenters suggested that CMS consider giving
human rights reviewing committees the added responsibility of reviewing
modifications, and requiring a clear appeals process for any individual
who does not agree to the conditions.
Response: We have amended the regulations to include a requirement
for informed consent and we specified that any modification of the
additional conditions must be supported by a specific assessed need and
justified in the person-centered service plan. We will add further
descriptions in future guidance.
Comment: Several commenters request that CMS specify the
requirements for provider-controlled settings so that providers and
developers get the message that facilities cannot be built or
established that are not the most integrated settings.
Response: We believe that all home and community based settings
should be integrated into and allow access to the greater community and
our regulation already outlines additional criteria that must be met to
qualify as a home and community-based setting where the setting is
provider-controlled. Adding further criteria may be too prescriptive
and could limit individual choice of settings.
Comment: A few commenters believe the proposed regulations would
eliminate or severely restrict HCBS in group homes for people with
disabilities in which providers have adopted reasonable policies
governing their operation designed to respect the individual's rights
and at the same time respect the rights of other residents.
Response: Based on our experience and significant public input, we
believe we must set minimum additional conditions for provider-owned or
controlled settings to ensure that they are home and community-based.
The commenters did not indicate which conditions would result in this
impact, nor provide suggestions for minimum conditions to meet the
intent of this provision of the rule. In an effort to address the
concerns raised by commenters who feared loss of current residential
options and the subsequent displacement of the individuals living in
such settings who receive HCB services and the concerns raised by other
commenters who urged us to draw an immediate and clear line of
demarcation for HCBS, we will permit states to propose transition plans
for existing approved HCBS under 1915(i) in accordance with section
441.710(a)(3). While our expectation is that states would transition to
compliance with this final rule in as brief a period as possible, we
will allow states to propose a transition plan that encompasses a
period up to five years after the effective date of the regulation if
the state can support the need for such a period of time. States are
expected to demonstrate substantial progress toward compliance
throughout any transition period.
Comment: One commenter believes the proposed regulations are biased
against provider-owned or controlled residential settings through the
proposed imposition of additional regulatory conditions on such
settings. The commenter believes that many provider-owned residential
settings are developed to assist with improving the availability of
accessible and affordable housing so that individuals with
developmental disabilities have some choice in community housing
options and can avoid the need for unnecessary institutionalization.
Response: We believe that it is appropriate to specify additional
conditions for provider-owned or controlled settings to ensure that all
individuals receiving HCBS are afforded the opportunities that are
characteristic of living in the community.
Comment: A few commenters stated their belief that the focus should
not be on the setting, but rather an individual's choices and the
person-centered service plan. The commenter stated that arbitrary
geographic or location specific criteria are not appropriate, and if a
provider-based setting can meet all of the criteria in Sec.
441.530(a)(1) or Sec. 441.710(a)(1), it should not matter where the
provider is located.
Response: We agree with these comments and believe the regulatory
language at Sec. 441.530(a)(1) and Sec. 441.710(a)(1) achieves this
purpose.
Comment: One commenter applauds use of the more general term
``provider-owned or controlled residential settings,'' but since CMS is
creating a new technical term defining a class of services, it would be
prudent to offer clearer regulatory guidance regarding the reach of
such a term. For example, would an elderly housing project that
included service coordination and other services be subject to these
provisions as a provider-owned residential setting? CMS may want to
consider limiting this term to apply to state-licensed or certified
settings to avoid confusion.
Response: We are not defining a class of services. We are
describing the conditions that provider-owned or controlled settings
must meet to be considered home and community-based settings. If the
elderly housing project is provider-owned or controlled, it would have
to meet these additional HCB setting conditions. We do not believe
limiting the application of the term ``provider-owned or controlled
residential settings'' to those licensed or certified by the state is
in the best interests of the individuals served under the HCBS
programs, nor would that approach be adequate to achieve the goal of
defining the qualities and other requirements for settings that are
home and community-based.
b. Target Population
The Affordable Care Act added section 1915(i)(7) to the Act, which
allows states to target the section 1915(i)
[[Page 2981]]
benefit to specific populations. We proposed that target population(s)
may be based on diagnosis, disability, Medicaid eligibility groups,
and/or age. States may target services only to eligible individuals in
their chosen target groups, or provide different services within the
1915(i) benefit to different target groups. Due to the ability to
define targeted populations, a state may now propose more than one set
of section 1915(i) benefits, with each benefit package targeted toward
a specific population. A state may also propose one section 1915(i)
benefit that targets multiple populations, and may offer different
services to each of the defined target groups within the benefit.
Additionally, a state may propose a section 1915(i) benefit that is not
targeted to a specific population and instead uses only the needs-based
criteria to establish eligibility for the benefit. The targeting option
does not permit states to target the benefit in a manner that would not
comply with section 1902(a)(23) of the Act regarding free choice of
providers, or that forestalls the opportunity for individuals to
receive services in the most integrated setting possible. Therefore,
targeting criteria cannot have the impact of limiting the pool of
qualified providers from which an individual would receive services, or
have the impact of requiring an individual to receive services from the
same entity from which they purchase their housing. For example, we
would not allow states to establish targeting criteria that would
restrict eligibility to only individuals who reside in provider-owned
and/or operated settings. If a state elects to target the benefit to a
specific population or populations, it must still establish needs-based
criteria that individuals must meet in order to be eligible for section
1915(i) of the Act services and the state may also establish needs-
based criteria for individual services within the benefit. The needs-
based criteria may include specific needs that are applicable to the
targeting criteria, but may also include general needs that apply
across all of the populations included in the benefit.
Comment: One commenter requested that CMS not limit people seeking
mental health treatment.
Response: We believe this commenter has misunderstood the intent of
this provision of the rule, which does not allow states to limit number
of participants but allows states the option to target section 1915(i)
of the Act to specific population types. So in this example, a state
could target a section 1915(i) benefit to individuals with a chronic
mental illness, but would not be able to limit or cap the number of
people meeting this target criterion. Anyone meeting this target
criterion, and also meeting the other eligibility requirements under
section 1915(i) of the Act, would be eligible to receive any needed
services included in the state's benefit.
Comment: A couple of commenters pointed out that the reference to
target criteria in Sec. 441.656(b)(2) of this section was incorrect.
Response: We thank the commenters for noting this error and we have
corrected this reference so that it now reads as ``Sec. 441.710
(e)(2).''
Comment: Two commenters expressed concern that allowing multiple
target groups within one 1915(i) state plan HCBS benefit might result
in a net reduction of service availability, and lead to institutional
care. One ``fears that the blending of target audiences'' will ``leave
the voiceless minority without access to adequate services.''
Response: As an optional approach available to states, this option
is not intended to restrict or compromise service availability. States
can choose which services they will offer under a 1915(i) State plan
benefit, regardless of whether they take up the additional option to
target a population(s). As with all state plan services, states must
offer all needed services that they choose to include under their
benefit to all who are eligible.
Comment: One commenter expressed concerns that allowing states to
serve multiple target populations in one benefit will lead to states
serving ``incompatible populations in the same service setting.'' They
cited examples in states where individuals with one type of disability
were harmed by others with a different disability, and requested CMS to
expressly prohibit states from serving different populations in the
same location.
Response: This section of the regulation does not speak to
combining different target groups in the same living situations, but
rather the inclusion of multiple target groups in the overall benefit
design and operation. Including multiple target groups in one benefit
will not alleviate responsibilities of States for quality assurance and
detailing their quality improvement strategies for that benefit.
Comment: A few commenters indicated that we should explicitly state
that ``a state may propose more than one set of section 1915(i) of the
Act benefits, with each benefit package targeted toward a specific
population'' and that the state may also target multiple populations
under one set of benefits or offer different services to each of the
defined target groups within the benefit.
Response: Under Sec. 441.710(e)(2)(ii) of the regulation text, we
specify ``The State may elect in the State plan amendment to limit the
availability of specific services defined under the authority of Sec.
440.182(c) or to vary the amount, duration, or scope of those services,
to one or more of the group(s) described in this paragraph.'' In the
preamble to the proposed rule, we stated ``Due to the ability to define
targeted populations, a state may now propose more than one set of
section 1915(i) benefits, with each benefit package targeted toward a
specific population. A state may also propose one set of section
1915(i) benefits that targets multiple populations, and may offer
different services to each of the defined target groups within the
benefit. Additionally, a state may propose a section 1915(i) benefit
that does not choose non-application of comparability and instead uses
only the needs-based criteria to establish eligibility for the
benefit.'' A change to the regulation text is not necessary but we will
include this information in future guidance.
Comment: One commenter recognized the benefit of the targeting
option as ``many states will not consider the State Plan HCBS benefit
if it does not include mechanisms to control costs, especially given
this existing economic climate.'' However, the commenter also noted
that ``generally systems should be designed to promote community access
over institutional access, regardless of individuals' presenting
characteristics.''
Response: We agree with this commenter and note that the ability to
target the benefit to specific populations is a state option afforded
by section 1915(i) of the Act, and thus, not something being made
available solely through this regulation.
Comment: A couple commenters noted that Sec. 441.656(e)(2)(ii)
references ``Sec. 440.182(b)'' which should be referenced as Sec.
440.182(c).
Response: We thank the commenters for noting this error and have
corrected this reference at Sec. 441.710(e)(2)(ii) so that it now
references services defined under the authority of Sec. 440.182(c).
Comment: A couple of commenters requested that the regulation
explicitly state in Sec. 441.656(e) that states may propose a section
1915(i) benefit that ``does not choose non-application of comparability
and instead uses only the needs-based criteria to establish eligibility
for the benefit.''
Response: Revision to regulatory text is not needed as Sec.
441.710(e)(2) already specifies that disregarding
[[Page 2982]]
comparability is a State option: ``In the event that a State elects not
to apply comparability requirements:* * *'' And Sec. 441.715 specifies
the requirement that States establish needs-based criteria for
determining an individual's eligibility under the State plan for the
HCBS benefit.
6. Needs-Based Criteria and Evaluation (Sec. 441.715) (Proposed Sec.
441.659)
Section 1915(i)(1)(A) of the Act requires states to establish
needs-based criteria for eligibility for the State plan HCBS benefit.
Institutional level of care criteria must be more stringent than the
needs-based criteria for the State plan HCBS benefit. Additionally, the
state may establish needs-based criteria for each specific State plan
home and community-based service that an individual would receive.
Comment: Some commenters supported the use of needs-based criteria
in determining eligibility for State plan HCBS. Several also expressed
appreciation of the statutory requirement that a state notify CMS and
the public 60 days in advance of any proposed restriction on the needs-
based eligibility criteria (adjustment authority), if the number of
individuals enrolled in the benefit exceeds the projected number
submitted annually to CMS. These commenters agreed that notification to
CMS should take the form of a State plan amendment.
Response: We appreciate these comments supporting this provision of
the rule.
Comment: A couple of commenters suggested that CMS clarify that a
60-day public notice be required for any changes in need-based
criteria, as well as any related level of care changes, and to include
notifying the individual and any authorized representative. They also
requested that this notice include guidance for states on the
individual's appeals rights and stipulate that appeals information must
be included in communications to individuals. A couple of commenters
also recommended a formal comment period, to provide an established
mechanism for public input on the state proposed modification prior to
federal action.
Response: Section 441.715(c)(1) requires states to provide at least
60 days notice of a proposed modification of the needs-based criteria
to the Secretary, the public, and each individual enrolled in the State
plan HCBS benefit. In addition, Sec. 441.715(c)(5) requires any
changes in service due to the modification of needs-based criteria
under the adjustment authority to be treated as actions as defined in
Sec. 431.201 and these actions are subject to the fair hearing
requirements of part 431 subpart E of this chapter. States are also
required under Sec. 431.12 to provide for a medical care advisory
committee to advise the Medicaid agency director about health and
medical care services, and the committee must have the opportunity for
participation in policy development and program administration. We
encourage states to seek effective public engagement in all of their
Medicaid 1915(i) activities.
Comment: A couple of commenters recommended a formal comment
period/participant notice be required when a state proposes to change
its level-of-care criteria for institutional care.
Response: Criteria for institutional care (level of care) are set
by states as a means to determine an individual's medical necessity for
a service. These criteria are state policy, not approved by us, and not
articulated in the Medicaid State plan, so we do not have an
opportunity to require notice or comment periods. States could adopt
their own notice and comment requirements. We note that to the extent a
change in level of care would affect access to Medicaid services,
states are required to notify beneficiaries and provide an appeal
process. We may review state institutional level of care criteria, for
example, to determine if stringency requirements are met in considering
a state plan amendment to establish the State Plan HCBS benefit under
section 1915(i) of the Act. Such review is for approval of the proposed
benefit, not approval of the level of care criteria, and our review
does not reopen state level of care policy for public comment.
Comment: A couple of commenters recommended that we change ``will''
to ``may'' in the proposed regulatory language so that CMS will retain
some discretion to adapt to unexpected circumstances.
Response: We agree with this recommendation from commenters. This
sentence in the regulation at Sec. 441.715(c) now reads ``The
Secretary may approve a retroactive effective date for the State plan
amendment modifying the criteria, as early as the day following the
notification period required under paragraph (c)(1) of this section, if
all of the following conditions are met . . .''
Comment: One commenter recommended that the 60 day written notice
to the Secretary (for proposals to revise needs-based criteria) be
provided at the same time as tribal notice is made, 60 days in advance
of submission of the State plan amendment.
Response: We acknowledge the comment with the following reminders:
Sec. 430.16 provides the Secretary 90 days to approve or disapprove a
State plan amendment, or request additional information. If the state
implements the modified criteria prior to the Secretary's final
determination with respect to the state plan amendment, the state would
be at risk for any actions it takes that are later disapproved.
Further, Section 5006(e) of the American Recovery and Reinvestment Act
of 2009 (Recovery Act), Public Law 111-5, codified at section
1902(a)(73), requires states to solicit advice from tribes and Indian
Health Programs prior to the state's submission of any Medicaid or CHIP
State plan amendment likely to have a direct effect on Indians, Indian
Health Programs, or Urban Indian Organizations. The statutory
requirement is that states must solicit this advice prior to submission
of a SPA or waiver to CMS following the process described for
soliciting advice from Indian Health Providers and Urban Indian
Organizations in each state's approved State Plan.
Comment: One commenter requested revision to Sec. 441.659(b) to
specify that there it is not a requirement that institutional or home
and community-based waiver criteria be higher than their level prior to
implementing the State plan HCBS benefit.
Response: We are unable to make this revision as it is would not
comport with section 1915(i)(1)(B) of the Act, which requires needs-
based criteria for receipt of services in nursing facilities,
intermediate care facilities for individuals with intellectual
disabilities, and hospitals, or waivers offering HCBS, to be more
stringent than the needs-based criteria for the State plan HCBS
benefit.
Comment: One commenter indicated that their state is attempting to
further change the Medicaid institutional level of care criteria to
restrict Medicaid eligibility to the lower need individuals in several
categories of settings, including the HCBS setting, and expressed
concern about how the federal proposal would intersect with this state
proposal, and whether the criteria would align, be duplicative, or
conflicting.
Response: In order to implement and maintain section 1915(i) State
plan HCBS, the state's institutional level of care criteria must be
more stringent than the needs-based criteria for the State plan HCBS
benefit.
We note that there are issues for states to consider other than
section 1915(i) of the Act that will influence decisions on levels of
care and needs-based criteria,
[[Page 2983]]
that are beyond the scope of this regulation, for example, statutory
requirements for maintenance of effort (MOE) in effect at the time of
this final rule, requirements of the ADA and the Olmstead decision, and
funding constraints. Under section 2001(b) of the Affordable Care Act,
States are not permitted to establish eligibility standards,
methodologies, or procedures that are more restrictive than those in
place on the date of the Affordable Care Act's enactment (March 23,
2010). For adults, this requirement lasts until the Secretary
determines that a health insurance exchange is fully operational in the
state; for children under the age of 19, the requirement lasts until
September 30, 2019. Because the application of LOC requirements for
institutions and HCBS waivers may have an impact on Medicaid
eligibility for some individuals, we encourage states interested in
using the State plan HCBS to contact CMS for technical assistance in
meeting these statutory requirements.
Comment: While several commenters expressed support for
grandfathering of institutional and waiver participants when states
increase stringency for institutional level of care, they also had
concerns that the stringency requirements might be interpreted to allow
a state to change the needs-based criteria between the institutional
and waiver level of care and the state plan home and community-based
level of care with the net effect that people would not be eligible for
either. They recommended that CMS revise the regulation to require
states to grandfather HCBS participants who would lose Medicaid
eligibility due to ``stringency'' adjustments. Two other commenters
also noted that CMS misinterpreted the statute where it specifies that
FFP ``shall'' continue to be available, as a state option stating their
belief that this indicates a state requirement and not an option.
Response: The statute at section 1915(i)(5) of the Act does not
create a mandate for states to continue to provide assistance to such
individuals and to claim FFP. The statute permits states the option to
continue receiving FFP for individuals who are in an institution or
HCBS waiver, if a state needs to modify section 1915(i) needs-based
criteria after implementation of a section 1915(i) benefit, and also
needs to modify institutional needs-based criteria in order to meet the
1915(i) stringency requirement. Therefore, we have not adopted this
change as requested to regulation text language at Sec. 441.715(b)(2).
However, we note that other legal provisions, such as those related to
discharge planning, might require the continued provision of certain
services to individuals.
Comment: One commenter recommended deletion of the provision at
proposed Sec. 441.659(c)(4)(ii). The commenter believes that the HCBS
population has predictable fluctuations in status and therefore the
grandfathering provision should be flexible enough to protect
individuals who go through short-term transitions.
Response: We disagree with this recommendation and have not made
this revision as requested. Section 441.715(c)(4)(ii) is an important
provision that requires states, when they revise needs-based criteria
after implementation of the benefit (adjustment authority), to continue
providing State plan HCBS to individuals who were eligible prior to the
change but no longer meet the state's new needs-based criteria until
such time as they no longer meet Medicaid eligibility requirements or
eligibility requirements to be served under the state's section 1915(i)
benefit.
Comment: One commenter recommended that CMS define the term
``independent'' in the regulation.
Response: This is defined at Sec. 441.730. Section 441.715 already
indicates that an agent (who performs the evaluation) must be
independent and qualified as defined in Sec. 441.730.
Comment: A couple of commenters commended the inclusion of a
requirement at Sec. 441.659(d)(3) to consult with the individual, but
recommend this be defined and strengthened to include a more central
role for the individual, including for example consultation with
providers, social service staff, or others identified by the
individual. Another requested Sec. 441.659(d)(3) be changed to reflect
that the person-centered service plan should have the person
``directing'' the plan whenever possible and suggested that if the
individual wishes, other people of the individual's choice be
consulted.
Response: This section of the rule pertains to the independent
evaluation to determine eligibility. Therefore, we do not believe it is
necessary to include requirements about the person-centered service
planning process, for which there are separate regulations at Sec.
441.725(a) and which already reflect the recommendations of this
commenter.
Comment: A couple of commenters noticed that Sec. 441.659(b)(2)
includes an incorrect reference to (c)(7).
Response: We have corrected the text in Sec. 441.715(b)(2) of the
final rule to change the reference from (c)(7) to (c)(6).
Comment: One commenter noticed that Sec. 441.659(d) incorrectly
references Sec. 441.656(a)(1) through (5), and that Sec.
441.659(d)(2) incorrectly references Sec. 441.656(a)(1) through (3)
and (b)(2).
Response: In Sec. 441.715(d), we have corrected the reference so
that it now reads as Sec. 441.715. In Sec. 441.715(d)(2), we have
also revised the reference so that it now reads correctly as Sec.
435.219 and Sec. 436.219.
Comment: One commenter requested that we eliminate the word
``eligibility'' from Sec. 441.659 and replace it with ``services'' to
eliminate confusion so that eligibility would be centered on
categorical eligibility while service criteria were used for needs-
based criteria.
Response: We are unable to make this requested revision, since
needs-based criteria are necessary for eligibility, in addition to the
other eligibility requirements specified in Sec. 435.219 and Sec.
436.219.
Comment: A couple of commenters requested that the regulation
include an individual's inability to perform 2 or more ADLs or IADLs as
a requirement for eligibility under section 1915(i) of the Act.
Response: This is not an eligibility requirement under the statute
and we are not able to make this requested revision. While
1915(i)(1)(F)(i) requires that the independent assessment include an
objective evaluation of an individual's inability or need for
assistance to perform 2 or more ADLs, this is only a suggested element
at 1915(i)(1)(D)(i) and thus, not required for an individual to be
determined eligible for 1915(i) State plan HCBS.
Comment: One commenter requested that we add a provision to Sec.
441.659(d)(3) to include consultation with the parents of a child.
Response: We believe that the broader term ``individual's
authorized representative,'' used in 1915(i) of the Act and in this
regulation, would include, in the case of a child, the child's parents
or legal guardian, and does not need to be explicitly stated in
regulation.
Comment: Another commenter recommended that when assessing the
individual's support needs for purposes of evaluation of eligibility,
that informal supports arranged by the individual not be considered
unless the individual explicitly chooses to include them.
Response: This suggestion is already captured in Sec.
441.720(a)(2) where the regulation requires the assessment to
``[hellip]include the opportunity for the individual to identify other
persons to be consulted, such as, but not limited to, the individual's
spouse, family,
[[Page 2984]]
guardian, and treating and consulting health and support professionals
responsible for the individual's care.''
Comment: A couple of commenters stressed the importance that FFP be
available for evaluations even when an individual is subsequently found
ineligible for section 1915(i) of the Act services.
Response: As stated in section III.N.2.of the preamble to the
proposed rule, FFP is available for evaluation and assessment as
administration of the approved state plan prior to an individual's
determination of eligibility for and receipt of other section 1915(i)
of the Act services. If the individual is found not eligible for the
State plan HCBS benefit, the state may claim the evaluation and
assessment as administration, even though the individual would not be
considered to have participated in the benefit for purposes of
determining the annual number of individuals served by the benefit.
Comment: Some commenters requested clarification regarding level of
need, as defined by the state and provider, including whether a state
may leverage existing and/or specific instruments that are used to
determine HCBS waiver eligibility in order to determine whether a
beneficiary meets the State plan HCBS needs assessment criteria for
participation, understanding that the State plan HCBS benefit
eligibility criteria must be less stringent than that used for HCBS
waiver programs.
Response: The state's process for determining eligibility must meet
the requirements at Sec. 441.715(d). We do not require a specific
instrument(s) that states must use in meeting these requirements.
Comment: One commenter indicated that if states establish needs-
based criteria for each specific service that an individual receives,
it would add to the complexity of the assessment service planning, the
overall costs of program administration, and potential beneficiary and
family caregiver confusion. They stressed that such variability in
Medicaid across states could become extremely difficult to track and
monitor.
Response: As specified in the regulation, this is optional for
states. This option could be of benefit for states that wish to include
services for individuals with specific needs within a section 1915(i)
of the Act benefit that is not targeted to a specific population
group(s) and is designed to provide a broad array of services.
Comment: One commenter requested CMS require states to make needs-
based criteria publicly available, including public Web site posting.
Another inquired how CMS will maintain publicly available documents
relating to the state's modification proposal, approval and denial
letters, comments submitted and communications with the state.
Response: We agree that web posting is an ideal way to make state
plans and amendments available to the public, and we are building a
web-based information system for all of Medicaid and CHIP that will
provide immediate access to state plan amendments. Section 1915(i) of
the Act SPAs will be part of that system. Until then, SPAs are
processed on paper and posted sometime after approval. We encourage
states to provide for effective public engagement in all of their
Medicaid program activities, and states are required to provide 60 day
public notice when states change reimbursement methodology or revise
CMS approved section 1915(i) needs-based criteria.
7. Independent Assessment (Sec. 441.720) (Proposed Sec. 441.662)
Section 1915(i)(1)(E) of the Act describes the relationship of
several required functions. Section 1915(i)(1)(E)(i) of the Act refers
to the independent evaluation of eligibility in section 1915(i)(1)(A)
and (B) of the Act, emphasizing the independence requirement. Section
1915(i)(1)(E)(ii) of the Act introduces the requirement of an
independent assessment following the independent evaluation. Thus,
there are two steps to the process: The eligibility determination,
which requires the application of the needs-based criteria and any
additional targeting criteria the state elects to require; and the
assessment for individuals who were determined to be eligible under the
first step, to determine specific needed services and supports. The
assessment also applies the needs-based criteria for each service (if
the state has adopted such criteria). Like the eligibility evaluation,
the independent assessment is based on the individual's needs and
strengths. The Act requires that both physical and mental needs and
strengths are assessed. We note that while section 1915(i)(1)(F)(i) of
the Act requires that the independent assessment include an objective
evaluation of an individual's inability or need for assistance to
perform 2 or more ADLs, this is only a suggested element at section
1915(i)(1)(D)(i) of the Act and thus, not required for an individual to
be determined eligible for 1915(i) State plan HCBS.
These requirements describe a person-centered assessment including
behavioral health, which will take into account the individual's total
support needs as well as the need for the HCBS to be offered. Section
1915(i)(1)(E)(ii) of the Act requires that states use the assessment
to: determine the necessary level of services and supports to be
provided; prevent the provision of unnecessary or inappropriate care;
and establish a written individualized service plan.
To achieve the three purposes of the assessment listed above, the
assessor must be independent; that is, free from conflict of interest
with regard to providers, to the individual and related parties, and to
budgetary concerns. Therefore, we proposed specific requirements for
independence of the assessor in accordance with section
1915(i)(1)(H)(ii) of the Act, and we will apply these also to the
evaluator and the person involved with developing the person-centered
service plan, where the effects of conflict of interest would be
equally deleterious. These considerations of independence inform the
discussion below under section 1915(i)(1)(H)(ii) of the Act regarding
conflict of interest standards.
Comment: Many commenters expressed support of the independent
assessment requirements in this section of the rule. One commenter who
expressed agreement with Sec. 441.662(a)(1), stated that individuals
with disabilities have a right to choose their own lifestyle, just like
their peers without disabilities.
Response: We appreciate these comments and support.
Comment: One commenter stated that clear assessment standards are
necessary to ensure that individuals deemed eligible for section
1915(i) of the Act services receive the services that are most
appropriate and effective.
Response: We agree and have specified these requirements in Sec.
441.720.
Comment: A commenter requested that we ensure there are assessments
of need for individuals residing in facility-based settings before the
development of their person-centered service plans.
Response: The requirements of this regulation pertain to all
section 1915(i) of the Act eligible and enrolled individuals residing
in home and community-based settings, regardless of the setting.
Comment: One commenter stated concern that Sec.
441.662(a)(1)(i)(A) refers to ``health care professionals,'' given that
often assessments of support needs--such as the Supports Intensity
Scale and functional-behavioral needs assessments--are made by case
[[Page 2985]]
managers or social workers, rather than health care professionals.
Response: As enrolled Medicaid providers of Medicaid services or
administrative activities, case managers and social workers are
included in our regulation as ``health care professionals.''
Comment: A couple of commenters requested that CMS add to paragraph
(a)(2) ``friends'' as respondents that the individual may identify to
participate in the assessment. They also commented that this paragraph
should require that the assessor actually contact and involve
individuals identified.
Response: We do not believe it is necessary to add an exhaustive
list of all the examples of the persons that an individual participant
may choose to include in this process. The requirement specifies a few
examples but emphasizes that these are just examples and not a
limitation.
Comment: A couple of commenters requested clarification in Sec.
441.662 (a)(4) on the requirements for a caregiver assessment,
including what it means, the process, and purpose. Another commenter
suggested its removal, stating that it unnecessary since there is
already an assurance elsewhere in the regulations that states must
assure the enrollees' health and welfare. However, many others
expressed their support of this provision and stressed the importance
of its inclusion in the regulation; some even urged CMS to include this
under other Medicaid HCBS authorities. One of these commenters
requested the addition that the caregiver assessment will assess the
training, support and respite needs and identifying options for
receiving these services. Another stated that the assessment should
evaluate the caregiver's well-being, needs, strengths and preferences,
as well as the consequences of caregiving on the caregivers.
Response: We included this provision in the proposed rule as a
result of comments received in response to the first proposed rule
pertaining to section 1915(i) of the Act, which was not finalized.
Those commenters stated that taking into account the capacity of
primary caregivers to provide for the individual's assessed needs is
necessary, and some stated that natural supports often have declining
capacity, and to fail to take this into account leads to unrealistic
plans. We agree that when caregivers are being relied upon to implement
the person-centered service plan, it is important that a caregiver
assessment be required in order to acknowledge and support the needs of
informal family caregivers. We agree that caregivers provide critical
care and support that enables individuals to live in their homes and
communities. When there is a caregiver involved, an assessment of the
caregiver's needs is essential to facilitate the individual's linkage
to needed supports. We appreciate the comments regarding definition and
process, which we will consider for future guidance.
Comment: Many commenters requested that CMS add language to the
rule that specifically addresses assessment of needs related to
cognitive impairment. A couple of commenters noted that this is needed
to promote early diagnosis of memory problems and prevent the cycle of
under-diagnosis and misdiagnosis of Alzheimer's disease. They stated
that many individuals with dementia need supervision and cueing or are
unable to perform instrumental activities of daily living. Others
expressed support of a more comprehensive approach to include social,
medical, behavioral, emotional, physical and cognitive strengths and
challenges, and also noted that on-going training and coaching in
understanding cognitive and behavioral issues unique to brain injury in
the planning process should be a part of the delivery system. They
stated that CMS and states will need to work with program participants
and community advocates to determine the appropriate depth of
assessment, allowing for an informed planning process while also being
respectful of some individuals' desire for a non-intrusive approach.
They also noted that a range of professionals may be suitable for
assessing cognitive as well as behavioral issues, including
neuropsychologists, psychologists trained in brain injury, educators,
and speech and language therapists.
Response: We agree with these comments and have added ``cognitive''
to Sec. 441.720(a)(4).
Comment: One commenter expressed support of the requirement for a
person-centered assessment process.
Response: We agree that this is essential to the assessment and
person-centered service planning process.
Comment: One commenter stated that it would be helpful for
providers and practitioners to have a degree of flexibility in
prioritization and to override recommendations for lower levels of
care. They noted that this could be kept at a particular level (that
is, no more than 5 percent of the time), but there are certain
conditions and situations that can result in skewed assessment results.
Response: We do not agree with this comment. We do not believe it
would be consistent with the intent of this sub-section, or with the
person-centered process requirements at Sec. 441.725, and would
enhance the potential for conflict of interest.
Comment: A few commented on the statutory requirement regarding
assessment of an individual's inability to perform two or more ADLs.
One suggested that the assessor also consider cueing as assistance,
whether by someone, a device or service animal in addition to
individual assistance or assistive technology. Another stated that the
statute does not set any specific needs-based or ADL criteria as a
standard for eligibility for any HCBS, and that CMS should clarify that
states should not interpret the two ADLs evaluation criteria in the
assessment to mean that two ADLs is the standard for eligibility for
the state plan option or for any specific services under the state plan
option. One commenter recommended that CMS clarify in the preamble that
while ADL review is a required element of the assessment, the result of
the ADL review cannot be a litmus test for access to services.
Response: An objective evaluation of the individual's inability to
perform two or more ADLs is, in statute, a required element of the
independent assessment but it is only a permissible element of the
independent eligibility evaluation. The statute does not specify that
eligibility for state plan HCBS must be based on the evaluation of the
individual's inability to perform a minimum number of ADLs. We
concluded that partial or complete inability to perform two or more
ADLs is not a statutory prerequisite to eligibility for State plan
HCBS. However, the evaluation of an individual's inability to perform
two or more ADLs, as required under section 1915(i)(1)(F)(i) of the
Act, is related to the state's responsibility under section
1915(i)(1)(E)(ii) of the Act to use the results of the assessment to
determine a necessary level of services and supports, prevent the
provision of unnecessary or inappropriate care, and establish an
individualized care plan.
Comment: Some commenters recommended that in-person assessments be
required or, alternatively, that telemedicine assessments be allowed
only in very limited circumstances when in-person assessments cannot
practically be performed. Other commenters agreed that it may be
appropriate to use technology to conduct assessments in certain
circumstances, such as for individuals in rural or underserved areas,
but not for beneficiaries for whom such circumstances do not create
[[Page 2986]]
barriers to an in-person and in-home assessment. They suggested
additional language to limit use of technology to conduct assessments
to individuals in rural areas, or other special circumstances by
requiring states to make an individualized determination of the need
for substituting telemedicine for genuinely in-person assessments. One
commenter stated that it should only be allowed if the state makes an
individualized determination of the need for substituting telemedicine
for genuinely in-person assessments. Another stated that assistive
technology or other alternative or augmentative communication should be
made available for those who would benefit from it. A few commenters
stated that Sec. 441.662(a)(1)(i)(B) should include, if the individual
wishes, the presence of family, a peer/parent support provider, or
other people of the individual's choice.
Response: In our preamble to the proposed rule, we indicated that
we added this provision of the regulation in recognition that many
states are developing infrastructure and policies to support the use of
telemedicine and other ways to provide distance-care to individuals in
order to increase access to services in rural areas or other locations
with a shortage of providers. However, we are concerned that by
limiting this technology to only these circumstances, the regulation
may end up precluding instances where it may be useful, maybe even
essential. Therefore, we are not adding this limitation to the
regulation, but will include this example in future guidance and
monitor its use by states. We also note that these requirements do not
override the other requirements for the assessment in this section,
including the person-centered process and consultation with persons
that the individuals choose to include.
Comment: A couple of commenters stated that Sec. 441.662(a)(7)
regarding habilitation services specifies that only Section 110 of the
Rehabilitation Act of 1973 and the Individuals with Disabilities
Education Improvement Act of 2004 are primary payors and that (a)(8)
should require documentation indicating that State plan HCBS also
available through other Medicaid services or other federally funded
programs, will not be provided:
``No State plan HCBS are provided which would otherwise be
available in the same amount, scope, and duration to the individual
through other Medicaid services or other federally funded programs
available under Section 110 of the Rehabilitation Act of 1973 and the
Individuals with Disabilities Education Improvement Act of 2004.''
Response: We do not agree with this suggested addition. The broader
requirement of this provision ensures that if the same services are
available through other sources, then State plan HCBS would not be
provided. Adding the suggested clause would leave the possibility for a
state to claim FFP for a service through section 1915(i) of the Act
before or instead of claiming it through these other authorities/
programs. Since the intent of this provision is to ensure that states
only claim for State plan HCBS when they are unavailable through other
sources, we are unable to incorporate the language requested.
Comment: A couple of commenters recommended adding a modification
so that Sec. 441.662(a)(8) would require that the services be
``immediately'' available to the individual.
Some commenters stated concern that a state might deny an
individual's ability to choose to receive a service through the section
1915(i) of the Act benefit, if that service would be theoretically
available under another federal program but the fact that the
individual was not provided with assistance in applying for those
services would result in delayed access to services or no access to
services. They instead proposed a ``no wrong door'' policy in enrolling
individuals in the section 1915(i) of the Act State plan benefit, so
that regardless of their eligibility status for services under other
programs the individual begins receiving the services they are
determined to need through their individualized assessment without
having to apply or complete additional eligibility determinations. They
also stated that individuals should be able to utilize the program that
best meets their needs and preferences, and provides for the greatest
degree of service coordination and administrative simplification.
Response: We developed the requirements at Sec. 441.720(a)(7) and
(8) due to concern over duplication of habilitation services and other
state-defined services. Additionally, since some individuals may be
simultaneously receiving services through a HCBS waiver and the section
1915(i) benefit, we require in Sec. 441.720(a)(9) documentation that
the services provided through section 1915(c) and section 1915(i) of
the Act authorities are not duplicative for the same individual. This
will also include coordination of assessments, person-centered service
plan development, and case-management to ensure that individuals
receiving services under both authorities are not subject to multiple
assessments and person-centered service plans. We believe the term
``available,'' addresses the concern and revision is unnecessary.
Comment: A commenter asked whether individuals would be required to
utilize the State plan HCBS benefit first, when those services are
duplicative of services also offered under a HCBS waiver for which that
individual is eligible, such as habilitation services.
Response: The determination of how such services would be provided
must be made during the development of the person-centered service
plan. Additionally, if the State plan HCBS will provide the same
amount, duration, and scope of service as another covered Medicaid
service, states must explain in their proposed SPA how they will ensure
against duplication of service and payment.
Comment: Several commenters expressed support of the requirement
for the assessment to be conducted ``in consultation with the
individual, and if applicable, the individual's authorized
representative, and include the opportunity for the individual to
identify other persons to be consulted, such as, but not limited to,
the individual's spouse, family, guardian, and treating and consulting
health and support professionals responsible for the individual's
care.'' However, one of these commenters stated this language stops
short from stating that the participant has a role in deciding who
participates in the assessment process, indicating that person-centered
practices require that participants drive the assessment process, and
this includes decisions pertaining to who is part of their team when
identifying and addressing unmet need.
Response: We believe this concern is fully addressed in the section
pertaining to the person-centered planning process at Sec. 441.725(a),
and we have added a cross reference to this section to Sec.
441.720(a)(1).
Comment: A commenter asked whether states can set limits on amount/
scope/duration of State plan HCBS benefits, as approved via the State
plan amendment process.
Response: Yes. Section 441.700 specifies that states are to
describe the services that they will cover under the State plan HCBS
benefit, including any limitations of the services.
Comment: One commenter expressed that states should have
flexibility in choosing the independent assessor to serve populations.
Response: States have the flexibility to determine the entity that
can perform this function, consistent with the
[[Page 2987]]
requirements at Sec. 441.730 regarding qualifications and Sec.
441.720 regarding the independent assessment.
Comment: One commenter noted that they have seen great variability
in assessment results for the same individual depending on what
incentives staff have for scoring a child or adult into or out of
particular specialty services. They expressed that it needs to be clear
which care provider or entity is responsible for completion of
assessment for a particular patient and, if there are competing
assessment results, which provider's or entity's assessment is
prioritized.
Response: We agree, which is why we emphasized the section 1915(i)
of the Act requirement for conflict of interest standards at Sec.
441.730(b). When a state proposes a SPA to add section 1915(i) of the
Act HCBS, we require that the state specify the entity that will be
responsible for the assessment, the qualifications of that entity, and
how the state will meet the conflict of interest requirements at Sec.
441.730(b). The commenter mentions the presence of multiple assessments
with competing assessment results, so we further note that there should
be one assessment that incorporates the findings of any other records
or information needed to develop the person-centered service plan as
required in Sec. 441.725.
Comment: One commenter asked that Sec. 441.662(a)(2) also require
that the assessor actually contact and involve the individuals
identified.
Response: Section 441.720 (a)(1) requires the assessment to be a
face-to-face contact with the individual and to be a person-centered
process.
Comment: One commenter stated that it will be important for CMS and
states to incorporate core elements of assessment that inform the
participant direction process and at minimum, are not in conflict with
participant-directed processes. They also stated that assessment
questions should not lead to premature assumptions pertaining to who is
appropriate for participant-direction simply based on diagnosis, the
availability of informal caregivers, the individual's functional need,
or cognitive status. Instead, assessment questions should be built on
an assumption that all individuals, with the appropriate level of
support, can participate in some form of participant direction.
Assessment questions should assist the participant and others involved
in the assessment process to identify unmet needs and the type of
support that may be beneficial to the individual to allow for
successful participant direction. In addition to identifying unmet need
(as defined by the individual), this could include an assessment of
strengths, abilities, individual goals, need for a representative,
capacity to self-direct with an eye for developing a support system to
ensure success in self-directing, and risks. For a participant
direction assessment to be successfully integrated into a larger
assessment process, those performing the assessment need to be well-
informed of participant direction programs, benefits, and requirements.
Those performing and overseeing assessment processes also need training
on the difference between traditional and participant-directed
paradigms of service delivery. State and local leaders need to be
informed, as well as educate their program staff, of the core
competencies required to effectively support people to self-direct.
Response: We appreciate these comments and will consider them in
future guidance that we develop after final publication of this rule.
Comment: One commenter recommended that the requirement to use a
``person-centered process'' in Sec. 441.662(a) cross reference Sec.
441.665, and suggests the phrase ``. . . and meeting the requirements
of Sec. 441.665'' be added to the end of Sec. 441.662(a).
Response: We agree with this recommendation and have added ``that
meets the requirements at Sec. 441.725(a)'' to Sec. 441.720(a)(1).
Comment: A couple of commenters requested clarification of the
relationship between the needs-based criteria that states must
establish for determining eligibility for HCBS, and for each specific
service. One of these commenters noted that Sec. 441.662(a)(5) implies
that need-based criteria must be in place for each service and
suggested moving the term ``(if any)'' to after the word ``criteria,''
and editing it to ``(if any have been established)''.
Response: We agree with this suggestion and have revised the first
sentence of Sec. 441.720(a)(5).
Comment: One commenter stated that clarification is needed
regarding the independent assessment that is conducted by a qualified
health care professional (suggesting a medical model approach), and a
true person-centered planning process.
Response: We acknowledge that this term used in this paragraph is
inconsistent with other language in this regulation, and have revised
Sec. 441.720(a)(1)(i)(A) accordingly.
Comment: A commenter recommended that in Sec. 441.662(a)(6) CMS
create a stronger regulation to promote self-direction of services, and
recommended the term ``any information'' be modified to ``notice, all
information, and any supports.''
Response: We did not make the changes requested by this commenter.
This paragraph pertains to what must be included in the assessment with
regards to self-direction if the State offers this under the State plan
HCBS benefit. Other requirements regarding self-direction of services
are contained in Sec. 441.740.
Comment: Several commenters had opinions on the frequency
requirements of the assessment. One requested that CMS expand this to
``at the request of the individual,'' as is similarly provided in the
regulation at Sec. 441.665(c). Another stated that the assessment
should be required every 3 years if clients are stable and engaged in
the community, to reduce stress on the case management system. A couple
of others just stated that re-assessments should occur ``frequently''
and when an individual's support needs or circumstances change
significantly. Some stressed that the assessment and re-assessment
process should be based primarily on individual need, and not place
burdensome processes on the individual. One stated that for individuals
unable to communicate via spoken, signed, written, or alternative/
augmentative communication, the regulations should include language
that significant changes in behavior and/or temperament indicate a need
for reassessment of services. And another stated that CMS should
clarify that the requirement for reassessment should not be interpreted
to mean that each individual requires a full-scale medical re-
evaluation, but instead re-assessment of services currently being used
and new services requested by the individual or those important to him
or her. One commenter asked how frequently the assessment must be made
if the individual's condition is one that is not likely to improve.
Response: The current regulation language states ``the re-
assessment of needs must be conducted at least every 12 months and as
needed when the individual's support needs or circumstances change
significantly, in order to revise the person-centered service plan.''
We believe that this language captures some of the concerns noted by
the commenters. For others, in order to accommodate the varying and
sometimes opposing comments, we believe that we should not change this
requirement as provided in the proposed rule. This minimum frequency is
consistent with the minimum frequency requirement for the review of the
person-centered service plan, which
[[Page 2988]]
is based on the statute at section 1915(i)(1)(G)(ii)(III) of the Act.
Comment: Several commenters noted language from the preamble of the
proposed rule that indicates that an assessment of ``needs and
strengths'' is more appropriate than needs and capabilities, as the
words capability and ability are historically connected with a deficit
oriented approach to assessment. They requested that CMS add the word
``strengths'' to Sec. 441.662(a). Some also requested that the
reference to needs in Sec. 441.662(a) specifically include physical
and mental health needs stating that it must be made clear in the
opening paragraph of this sub-section that these must also be assessed
in order to establish a service plan.
Response: While we agree that these are elements that must be
included in the assessment process, we believe this is already captured
sufficiently under Sec. 441.720 (a)(4) of this section which states,
``Include in the assessment the individual's physical, cognitive, and
behavioral health care and support needs, strengths and preferences, .
. .'' Therefore, we have not adopted this change as requested.
Comment: Several commenters stated the regulation text should also
include the language from the preamble that indicates that services
must be furnished to individuals with an assessed need, and must not be
based on available funds.
Response: This was an explanatory statement of the requirement at
Sec. 441.677(a)(1)(ii) of the proposed rule, which is now at Sec.
441.745 (a)(1)(ii) of the final rule, and is not necessary to
specifically state in regulation.
Comment: Several expressed that the regulation should include
language from the preamble that states the ``role of the assessor is to
facilitate free communication from persons relevant to the support
needs of the individual.''
Response: This is an explanatory statement in the preamble of the
requirement already included at Sec. 441.720(a)(2) regarding
consultation with the individual and if applicable, the individual's
authorized representative, and others that the individual would like to
include. We will plan to include this explanation in future guidance.
8. Person-Centered Service Plan (Sec. 441.725) (Proposed Sec.
441.665)
Section 1915(i)(1)(G) of the Act requires that the State plan HCBS
benefit be furnished under an individualized care plan based on the
assessment. The terms ``care plan'' and ``service plan'' are used
interchangeably in practice. As explained in the May 3, 2012 proposed
rule (77 FR 2012-10385), we have adopted the term ``person-centered
service plan'' in this regulation. To fully meet individual needs and
ensure meaningful access to their surrounding community, systems that
deliver HCBS must be based upon a strong foundation of person-centered
planning and approaches to service delivery. Thus, we proposed to
require such a process be used in the development of the individualized
person-centered service plan for all individuals to be served by
section 1915(i) of the Act benefit. We proposed certain requirements
for developing the person-centered service plan, but noted that the
degree to which the process achieves the goal of person-centeredness
can only be known with appropriate quality monitoring by the state,
which should include substantial feedback provided by individuals who
received or are receiving services.
a. Person-Centered Planning Process Sec. 441.725(a)
Comment: One commenter requested that CMS ensure that there is a
plan in place and implemented for more than medication management for
individuals residing in facility-based settings.
Response: The requirements of this regulation pertain to all
section 1915(i) of the Act eligible and enrolled individuals residing
in home and community-based settings, regardless of the setting.
Comment: One commenter states that the driver and focus of the
person-centered planning process is the individual and this concept is
presented in Sec. 441.665. However, it is not referenced at all in the
provisions of Sec. 441.659 pertaining to needs-based criteria and
evaluation, nor in the provisions of Sec. 441.662 related to
independent assessment.
Response: The needs-based criteria established by each state
determine an individual's eligibility through an independent assessment
and evaluation, which by its nature, focuses on the person. The
individual does not drive or control these processes; however, the
individual is the center of this process. The regulation at Sec.
441.720(a)(1), regarding independent assessment, references Sec.
441.725, person-centered service plan.
Comment: One commenter supports the expectation that states support
individuals in the planning process as well as monitor the person-
centeredness of the process itself. The commenter requests further
refinement of the rule to ensure that program participants and
community stakeholders are actively engaged in the states' design of
the program as well as its ongoing quality management structure so that
person-centered processes can be designed and monitored with
substantial involvement of stakeholders. The commenter is also pleased
to see that as part of the service planning process, program
participants (including those not self-directing) will be offered
choices pertaining to the services and supports they receive. The
commenter requests that specific examples or guidelines be offered to
states to demonstrate what this choice may look like within traditional
services.
Response: We agree with the commenter's suggestion and will take it
into consideration in developing future guidance.
Comment: Some commenters stated that it is important that the
regulation include the statement in the preamble that indicates that
the service plan ``should be constructed in a manner that promotes
service delivery and independent living in the most integrated setting
possible.''
Response: It is our expectation that the person-centered process
incorporate the ideals stated in the preamble and we believe that this
expectation is expressed in the regulation text at Sec. 441.725(b)(1).
Comment: A few commenters recommended the following revision to
Sec. 441.665(a)(1), ``Includes people chosen by the individual,
including a parent and a parent support provider in case of a child and
a youth support provider when the individual is under the age of 25.''
A few commenters recommended the person-centered planning process allow
HCBS providers and other health care providers to participate in
service plan development and/or be the service plan developer.
Response: We appreciate the commenters' perspective and
suggestions. We do not want to prescribe all people who may be included
in the planning process since that action may unintentionally exclude
someone who is chosen by the individual.
Comment: Several commenters recommended that Sec. 441.665(a)
address those individuals not able to indicate a choice of whom they
would like to participate in the person-centered planning process and
that in these instances, the process should allow inclusion of people
who know and care about the individual. One commenter encourages CMS to
note the potential role of family members, peers, providers, and others
during the person-centered service planning for HCBS. One commenter
recommended that individuals who require assistance in
[[Page 2989]]
making decisions due to profound cognitive limitations may need the
protection of legally-appointed guardianship arrangements, preferably
by a family member or another individual who is familiar with an
individual's unique needs. In many instances, it will not be feasible
for service planning for individuals with brain injury to be furnished
by any other individual or entity. One commenter encourages the use of
advance directives to assure that a person's wishes are clear in the
event he/she needs assistance, but is unable to otherwise express
himself/herself.
Response: We believe that the regulation text as proposed, and
which we are finalizing at Sec. 441.725(a)(1), encompasses the
suggestions that the commenter proposes.
Comment: A few commenters recommended that Sec. 441.665(a) of the
proposed rule should also require that person-centered service plans
include examples and language referring to positive strategies to
minimize the use of all types of restraints (chemical, physical, and
mechanical) and other restrictive procedures.
Response: We have strengthened the language of this section in the
final rule at Sec. 441.725(b)(13) by indicating that any modification
of the additional conditions must be justified in the person-centered
service plan and added specific requirements about what must be
documented in the person-centered service plan in these instances.
Comment: Several commenters recommend the following revision to
Sec. 441.665(a)(2), ``Provides necessary information, support and
experiences, if needed, to ensure that the individual directs the
process to the maximum extent possible, and is provided meaningful
opportunity to make informed choices and decisions.'' One commenter
requested that the regulation more clearly state that an individual
must be given information about all available supports and services.
Response: We believe that the regulation text at Sec.
441.725(a)(2) is complete and clear.
Comment: A commenter suggested that the regulation must more
clearly state that an individual must be given information about all
available supports and services. The commenter also states that the
individual must be given complete and accurate information about his/
her right to a fair hearing and the regulation should require that this
information be provided at every person-centered planning meeting and
that a simple easy to use form be provided to request a fair hearing.
Response: It is our expectation that during the person-centered
planning process and development of the person-centered service plan,
all services and support options available will be articulated and
discussed with the individual. States must adhere to the fair hearing
requirements at part 431, subpart E for all Medicaid programs.
Comment: A few commenters recommended modifying Sec. 441.665(a)(3)
to read, ``Is timely, flexible, and occurs at times and locations of
convenience to the individual.'' One commenter requested clarification
regarding the standard against which a state's ``person-centered''
process will be reviewed or the timeline for development of those
criteria.
Response: We believe that the requirement regarding scheduling the
meeting at the convenience of the individual addresses the flexibility
issue and are not incorporating the suggested language. The minimum
standards for person centered planning are enumerated in the
regulation.
Comment: Many commenters recommended that the language in the
regulation text at Sec. 441.665(a)(4) be revised to include physical,
linguistic and cultural accessibility in the person-centered planning
process. One commenter requested that cultural considerations be
expanded to include ``lifestyle'' choices of the individual.
Response: We appreciate the commenters' suggestions and note that
the regulation text at Sec. 441.665(a)(4) addresses cultural
considerations. We have added regulation text at Sec. 441.725(a)(4) to
specify that the person-centered planning process must be accessible to
persons who are limited English proficient and persons with
disabilities, consistent with the Medicaid programmatic accessibility
provision at Sec. 435.905(b). Policy guidance to promote compliance
with Title VI's prohibition against national origin discrimination
affecting persons with limited English proficiency is available on the
Department of Health and Human Services Office for Civil Rights Web
site at https://www.hhs.gov/ocr/civilrights/resources/laws/revisedlep.html.
Comment: Several commenters suggest inserting language at Sec.
441.665(a)(2) such as meaningful choice, informed decision-making,
provision of meaningful information about settings, including the most
integrated setting alternatives appropriate for that individual.
Response: We appreciate the commenters' suggestions. While we have
not made any revisions to Sec. 441.725(a)(2), we have considered these
comments for other revisions made to the regulation.
Comment: Many commenters agreed with the provision at Sec.
441.665(b)(1) that the person-centered plan should record the
alternative home and community-based settings that were considered by
the individual. Another commenter requested CMS add a requirement that
``all residents have selected this setting from a meaningful choice of
alternatives, including the most integrated setting appropriate for
each resident.'' One commenter requests with respect to Sec.
441.665(a)(8), that this provision should be modified to read,
``Documents how the home and community-based settings, services and
supports, including both residential and employment settings and
supports, are in line with the USDOJ most integrated setting mandate
under the ADA and Olmstead decision, and in cases where settings and
services are not fully aligned with the `most integrated setting'
mandate, provides full documentation regarding why less integrated/
congregate settings and services are being utilized.''
Response: We appreciate the commenters' support. We have addressed
the concern regarding meaningful choice and most integrated settings by
clarifying that the individual's selection must include non-disability
specific housing opportunities. We support the mandates of the ADA and
the Olmstead decision and believe the final regulation reflects the
spirit of these mandates.
Comment: A commenter supports the expectation that states support
individuals in the planning process as well as monitoring the person-
centeredness of the process itself. The commenter requests further
refinement of the rule to ensure that program participants and
community stakeholders are actively engaged in the states' design of
the program as well as its ongoing quality management structure so that
person-centered processes can be designed and monitored with
substantial involvement of stakeholders. The commenter is also pleased
to see that as part of the service planning process, program
participants (including those not self-directing) will be offered
choices pertaining to the services and supports they receive. The
commenter requests that specific examples or guidelines be offered to
states to demonstrate what this choice may look like within traditional
services.
Response: We appreciate the support. States are provided the
latitude to determine how they will operationalize
[[Page 2990]]
the regulation. We do not wish to be as prescriptive as suggested.
Comment: A few commenters recommended that CMS require any
modifications to the conditions placed upon provider-controlled or
owned residential settings be supported by a specific assessed need
documented in the person's person-centered plan. One commenter stated
that they did not support unnecessarily restrictive methods for
providing person-centered services and supports even though they may be
well-meaning.
Response: We agree with the commenters' statements and have
strengthened the language of this section in the final rule by
requiring at Sec. 441.725(b)(13) that any modification of the
additional conditions must be justified in the person-centered service
plan. We also added specific requirements about what must be documented
in the person-centered service plan in these instances.
Comment: One commenter suggested that CMS make the person-centered
process the critical identification for what is determined to be
community-based not where the site is located or what it looks like.
Another commenter states that the person-centered planning meeting
should be where the needs and preferences are matched with compatible
and appropriate services/living arrangements and where modifications to
existing services and acceptable compromises are determined. They state
that maintaining a full continuum of services and settings is a better
plan than limiting options or making them harder to access because some
people might find them objectionable. One commenter states that
specific restrictions on living arrangements should not supersede
supports and services identified through the person-centered planning
process.
Response: We believe that our regulations need to address the issue
of what constitutes home and community-based settings. While the
person-centered service plan can and does assist individuals with
integration into the community, it is not the vehicle to determine
whether a setting meets the requirements for being home and community-
based.
Comment: One commenter requested deletion of the requirement that
services be based on the needs of the individual as indicated in their
person-centered service plan, stating that these plans are often
limited by the experience of the individuals developing them and the
most effective treatments/supports may not always be included. The
commenter noted that service needs and ideas for how best to offer them
evolve, particularly as a person progresses and service plans often
become stale before they are reviewed/updated.
Response: We do not agree with removing this requirement, and note
that it is based on statute at section 1915(i)(1)(G) of the Act. States
are responsible for determining that requirements related to the
qualifications of the entities who will conduct the assessments and the
person-centered planning process have been met. It is expected that the
providers would have adequate training to perform the function
consistent with the requirements set forth in the regulation. States
must ensure the person-centered service plan process is timely and
includes a method for the individual to request updates to the plan.
Additionally, an assessment of need must be conducted when the
individual's support needs or circumstances change significantly and
revisions to the person centered services plan are necessary.
Comment: Many commenters recommend deletion of the language that
says the requirements are ``based on the needs of the individual as
indicated in their person-centered service plan.'' The commenters
believe that without deletion or modification of the proposed language,
it would be too easy for a provider to insert certain language in a
service plan.
Response: The person centered planning process includes provisions
to protect a person-centered service plan from being changed without
the individual's consent. We believe the inclusion of this language is
a necessary beneficiary protection; therefore we did not revise the
regulation to remove this requirement.
b. Person-Centered Service Plan Sec. 441.725(b)
Comment: One commenter states that if CMS defines what a service
plan should be, it may be in direct conflict with how states define
their services and the commenter does not believe that this is the
intent of CMS.
Response: We do not define specific services. However, we do define
what should be included in the person-centered service plan, and by
adopting the terminology and process of a person-centered service plan,
the services and supports should reflect the individuals preferences
based on their needs.
Comment: One commenter recommended, for high-need children and
older adult beneficiaries, the option of further assessment and
recommends that there be allowable reimbursement for these activities
necessary for developing the service plan, including communication with
collateral treatment partners (that is, pediatrician, teacher, school
representative, parent) as these partners and activities are critical
for development of a service plan for vulnerable beneficiaries and are
absolutely essential for proper care for children and for seniors.
Response: States may be able to claim reimbursement for assessment
activity, as well as person-centered service plan development, as a
Medicaid administrative activity that is in accordance with an approved
cost allocation plan.
Comment: One commenter recommended enhancing regulation language to
ensure that states have the flexibility to include services and
supports that are appropriate and essential for child and youth
development, but may not be Medicaid reimbursable, including education,
housing, and transportation, as to encompass a comprehensive service
provision supported by HCBS.
Response: We believe the language in Sec. 441.725(b)(5) of the
final rule supports this concept: ``the plan must . . . reflect the
services and supports (paid and unpaid) that will assist the individual
to achieve identified goals, and the providers of those services and
supports, including natural supports.''
Comment: Commenters supported Sec. 441.665(b) and suggested that
equal emphasis be placed on what is important for the individual and
what is important to the individual. One commenter recommended the
following, ``The person-centered service plan must reflect the services
and supports that are important for the individual to meet the needs
identified through an assessment of functional need, and what is
important to the individual with regard to preferences for the delivery
of such services and supports, including, but not limited to, living
arrangement, neighborhood, leisure activities, and relationships.''
Response: We appreciate the commenters' support. As the language of
the proposed rule supports this concept, we do not believe that the
suggested revisions for the final rule at Sec. 441.725(b) are
necessary.
Comment: Many commenters stated their support of person-centered
planning and expressed that when the individual welcomes the
involvement of family or other informal caregivers, family members
should be engaged as part of the care planning and care-giving teams.
They stated that services to be provided by family caregivers should
only be included in the person-and family-centered plan if they have
agreed to provide these services and feel
[[Page 2991]]
prepared to carry out the actual tasks. One commenter agreed with
preamble language that the service plan should neither duplicate, nor
compel, natural supports, expressing that unpaid supports should be
provided voluntarily. This commenter suggested that CMS include this
specific language in the regulation text.
Response: We appreciate the support of the commenters. The language
in Sec. 441.725(b)(5) of this final rule states: ``Natural supports
are unpaid supports that are provided voluntarily to the individual in
lieu of State plan HCBS.''
Comment: One commenter supported requirements for the development
of a person-centered plan but recommends that Sec. 441.665(b)(9)
should clarify that even though the service plan is ``finalized and
agreed to in writing by the individual'' the individual retains the
right to appeal a denial, reduction, suspension, or termination of a
service described in part 431, subpart E.
Response: As the fair hearing requirements at part 431, subpart E,
apply to all Medicaid services, it is not necessary to revise the text
of the regulation at Sec. 441.725.
Comment: Some commenters recommended that each person-centered
service plan include the dollar figures of the budget allocations
provided to each beneficiary, the starting date of services/supports,
the scope and duration of service, and all other services that are not
Medicaid reimbursable.
Response: We agree that the person centered service plan should be
comprehensive and the language in the final rule supports this concept.
Comment: Two commenters were against requiring the signatures of
all individuals and providers responsible for implementation of the
service plan, stating that this is impractical and will make the
process untenable. They also expressed that giving all providers the
entire service plan would share personal health information of the
member with providers who do not necessarily need to see that
information. One commenter was concerned about liability and who is
responsible if an individual has risky behavior.
Response: The regulation language at Sec. 441.725(b) gives the
flexibility for the individual to determine to whom the plan will be
provided, in whole or in part, commensurate with the level of need of
the individual and the scope of the services and supports available.
Sharing of this information must be consistent with federal and state
laws regarding privacy and confidentiality.
Comment: Several commenters recommended the following revisions for
Sec. 441.665(c): ``The person-centered service plan must be reviewed,
and revised upon reassessment of functional need as required in Sec.
441.662 of this subpart, at least every 12 months, when the
individual's circumstances or needs change significantly, and at the
request of the individual, an authorized representative, or healthcare
or support providers.'' One of these commenters stated that while
having a service plan required every 12 months may be minimally okay
for some populations, it is insufficient (too lengthy) for those with
chronic mental health and substance use disorders. Another commenter
stated that, at a minimum, requiring service plan review every 6 months
is adequate. Another commenter stated that the reassessment being done
``at the request of the individual'' could lead to inflated service
hours and costs, both of which will add unnecessary costs to the
provision of HCBS. This commenter believed the language at Sec.
441.662(b) is better language. Another commenter was against requiring
assessments before the meeting.
Response: We proposed 12 months as the minimum time period for an
individual's person-centered service plan to be reviewed and revised.
We agree and support reviews and revisions of an individual's person-
centered service plan more frequently as needed. The person-centered
service plan should be reviewed and revised when the individual's
circumstances or needs change significantly and at the request of the
individual, authorized representative or healthcare provider.
Comment: One commenter did not support standardized functional
assessment. In addition, the commenter stated that when service
providers use a functional assessment, it has been typically to
establish funding levels, which should only be determined by a person-
centered planning process and allowing such an instrument to overrule
the person-centered plan completely negates the person-centered
planning process.
Response: An individual's person-centered plan must be based on
that individual's assessment of functional need. We have not specified
the instruments or techniques that should be used to secure the
information necessary to determine an individual's functional need,
person-centered service plan, or service budget. States do have the
ability to establish limits on amount, duration, and scope of services.
Comment: With respect to Sec. 441.665(b)(6), one commenter stated
that individual back-up plans have been a critical component of
participant direction. A commenter suggested when refining the proposed
language, it will be important to reflect on the impact the traditional
paradigm has on the role providers and participants play in defining,
identifying, and addressing risk.
Response: We have strengthened the language in the final rule to
ensure that reducing risk for individuals receiving Medicaid HCBS does
not involve abridgement of their independence, freedom, and choice.
Restricting independence or access to resources is appropriate only to
reduce specific risks, and only when considered carefully and reflected
in the person-centered service plan.
9. Provider Qualifications (Sec. 441.730) (Proposed Sec. 441.668)
In the proposed rule, we proposed to require states to provide
assurance that necessary safeguards have been taken to protect the
health and welfare of the enrollees in State plan HCBS by provision of
adequate standards for all types of providers of HCBS. States must
define qualifications for providers of HCBS, and for those persons who
conduct the independent evaluation of eligibility for State plan HCBS
and independent assessment of need, and who are involved with
developing the person-centered service plan. We noted that we will
refer to the individuals and entities involved with determining access
to care as ``agents'' to distinguish this role from providers of
services. We also noted that the proposal in no way preempts broad
Medicaid requirements, such as an individual's right to obtain services
from any willing and qualified provider of a service.
We believe that these qualifications are important safeguards for
individuals enrolled in the State plan HCBS benefit and proposed that
they be required whether activities of the agents are provided as an
administrative activity or whether some of the activities are provided
as a Medicaid service. At a minimum, these qualifications include
conflict of interest standards, and for providers of assessment and
person-centered service plan development, these qualifications must
include training in assessment of individuals whose physical or mental
condition may trigger a need for HCBS and supports, and an ongoing
knowledge of current best practices to improve health and quality of
life outcomes.
The minimum conflict of interest standards we proposed to require
would ensure that the agent is not a relative of the individual or
responsible for the individual's finances or health-related decisions.
The standards also require that the agent must not hold a financial
interest in any of the entities that
[[Page 2992]]
provide care. Our experience with HCBS in waivers indicates that
assessment and person-centered service plan development should not be
performed by providers of the services prescribed. However, we
recognize that in some circumstances there are acceptable reasons for a
single provider of service that performs all of those functions. In
this case, the Secretary would require the State Plan to include
provisions assuring separation of functions within the provider entity.
Comment: One commenter questioned the reason for defining persons
responsible for the independent evaluation, independent assessment and
the service plan as ``agents'' to distinguish them from ``providers''
of HCBS. Another commenter indicated that it is unclear whether one
agent performs an assessment, or different agents with different
expertise.
Response: In the preamble to the proposed rule, we discussed that
we will refer to persons or entities responsible for the independent
evaluation, independent assessment, and the person-centered service
plan as ``agents'' to distinguish them from ``providers'' of home and
community-based services. We also explain that this does not preclude
the inclusion of input from other individuals with expertise in the
provision of long-term services and supports, or the delivery of acute
care medical services, as long as an independent agent retains the
final responsibility for the evaluation, assessment, and person-
centered service plan functions.
Comment: A commenter requested whether states would be permitted to
allow a transition period for agents conducting the individualized
independent evaluation, assessment and service plan development to
attain any new qualifications, if necessary.
Response: We believe that it is important for individuals
responsible for evaluation, assessment, and/or person-centered service
plan development to fully meet the qualifications specified at Sec.
441.730(c) prior to performing these activities.
Comment: Several commenters recommended adding a requirement to
this section of the regulation that service providers not discriminate
against recipients on the basis of race, color, national origin,
religion, sex, sexual orientation, gender identity, marital status,
source of payment, or mental or physical disability. Similar
protections are contained in the regulations for the Program for All-
Inclusive Care for the Elderly (PACE).
Response: There are already general provisions in other regulations
that pertain to the issues raised by the commenters and that prohibit
discrimination in State Medicaid programs on the basis of race, color,
national origin, disability, etc., (for example, see Sec. 430.2, Sec.
435.901, Sec. 435.905, and Sec. 435.908). As these regulations apply
in determining eligibility and administering the Medicaid program
generally, it is not necessary to add a regulation on this subject
specific to section 1915(i) of the Act.
Comment: Several commenters requested further clarification
pertaining to provider qualifications for the participant direction
option and requested that provider qualifications for participant-
directed workers not limit participants' access to these providers but
be defined by the program participant receiving services once s/he is
trained on the program rules and expectations. One commenter
recommended that CMS make provider qualifications ``default rules''
that could be waived through an informed and affirmative choice, with a
signed statement, by consumers who are directing their own care.
Another commenter requested that CMS add to the regulation ``Such
standards shall not be construed to limit the ability of self-directing
individuals who have employer authority to hire, train, manage, or
discharge providers pursuant to Sec. 441.674.''
Response: As stated in the proposed rule, and retained in the final
rule, individuals who choose to self-direct will be subject to the same
requirements as other enrollees in the State plan HCBS benefit,
including Sec. 441.730 for provider qualifications. Section 441.730
requires states to define in writing standards for providers (both
agencies and individuals) of HCBS, and for agents conducting
individualized independent evaluation, independent assessment, and
person-centered service plan development. As with section 1915(c) of
the Act waivers, states have to define minimum service provider
qualifications that apply across the service delivery models.
Comment: Many commenters expressed support of the conflict of
interest provisions of the proposed rule. One such commenter stated
support of standards that will result in service plans that have
realistic expectations and payment for providers while adequately
addressing the client's individual needs, noting that too often costs
are driving decisions about the appropriate services for the
individual. One mentioned that it is difficult for a system to be
completely free of conflict of interest, since any assessor that works
for the state has an interest in controlling costs, but stated their
belief that acknowledging the conflicts helps to mitigate the effects.
Another indicated that guidance should reflect administrative
safeguards that consider each state individually and consider the
unique characteristics and needs of each state, and include conflict
free protections that address the development of the plan and choice of
providers with an emphasis on individual preferences. Another requested
that this be closely monitored.
Response: We appreciate the support and agree with the commenters.
We will consider these additional comments as we develop future
guidance.
Comment: Several commenters requested that Sec. 441.668 exclude a
managed care organization from conducting the independent evaluation of
individuals. Another stated a managed care organization should not be
permitted to conduct the independent assessment of individuals. And
another requested this section also exclude ``the state'' from
conducting the independent assessment of individuals.
Response: We do not believe it is necessary to list specific
entities that would not meet these requirements in regulation. We
believe the specific requirements of Sec. 441.730 capture the purpose
of these requirements to mitigate and prevent conflict of interest.
Comment: One commenter indicated that the requirements regarding an
independent evaluator would not work in a capitation model, and that it
adds another level of bureaucracy and impacts service systems already
in place by some states that delegate or contract out this function to
another agency. Another commenter stated that the requirements would
limit states to the development or use of models that contradict
decades of long term care policy and efforts to coordinate an otherwise
fragmented system. They expressed that models that consolidate
evaluation, assessment, care planning, case management and the
provision of services into integrated, single entry systems enable
beneficiaries to more seamlessly access services and receive
coordinated, integrated plans of care (for example, long term home
health care programs, managed long term care, PACE). Another commenter
disagreed with the independent agent requirement, stating there may be
cost implications if an independent contractor is used to develop the
person-centered service plan and that this proposed requirement may
work in a fee-for-service benefit, but would not work in a benefit that
is capitated.
[[Page 2993]]
Response: We disagree and have experience with states where this
does and is working in these models. While the evaluation to determine
whether an individual is eligible for the benefit would need to be
retained by an independent entity that is not the provider, providers
can contribute information to the entity responsible for the final
determination. Regarding the independent assessment of need and person-
centered service plan, to summarize Sec. 441.730(b)(5), states can
allow providers of State plan HCBS, or those who have an interest in or
are employed by a provider of State plan HCBS, to be the entity
responsible for the assessment and person-centered service plan
functions, when the state demonstrates that they are the only willing
and qualified agent to perform these two functions in a geographic
area, and the state devises conflict of interest protections including
separation of agent and provider functions within provider entities,
and a clear and accessible alternative dispute resolution process for
individuals. In summary, the requirements at Sec. 441.730, which are
based on our experience as well as state and other public feedback,
specify how states must comply with statutory requirements. Therefore,
we are retaining the requirements from the proposed rule at Sec.
441.730 regarding independent evaluation and conflict of interest
standards, in this final regulation. We note that CMS stands ready to
assist any State Medicaid agency in need of technical assistance with
these requirements.
Comment: Several commenters requested that Sec. 441.668(b)(5) be
expanded to make it clear that when there is only one provider
available, the provider may serve as the agent performing the
assessment and the agent developing the plan of care, as long as the
requirements in Sec. 441.668(b)(5) are met. Another commenter proposed
permitting providers in some cases to serve as both agent and provider
of services, but with guarantees of independence of function within the
provider entity.
Response: We believe that Sec. 441.730(b)(5) already includes this
requirement: ``Providers of State plan HCBS for the individual, or
those who have an interest in or are employed by a provider of State
plan HCBS for the individual, except when the state demonstrates that
the only willing and qualified agent to perform independent assessments
and develop plans of care in a geographic area also provides HCBS, and
the state devises conflict of interest protections including separation
of agent and provider functions within provider entities, which are
described in the State plan for medical assistance and approved by the
Secretary, and individuals are provided with a clear and accessible
alternative dispute resolution process.''
Comment: A couple of commenters recommended deletion of Sec.
441.668 (b)(5), indicating that this provision to waive the conflict of
interest standards minimizes safeguards to protect individual health,
welfare, choice, and control. They indicate that states should be
required to develop in all geographic areas sufficient systems of
independent evaluators, independent assessors, and providers to develop
service plans. They noted that since CMS's experience with HCBS waivers
has shown that assessment and service plan development should not be
performed by service providers, this should be carried over and applied
to State plan HCBS as well.
Response: Section 441.730 (b)(5) requires that service providers
not be permitted to be the agent responsible for these functions, but
includes an exception to allow a state to permit a service provider to
serve as the agent performing independent assessments and development
of the person-centered service plan when that service provider is the
only entity available in a certain area. This is only permitted to
address this potential problem of not having any entity available that
is not a provider to perform these essential functions of independent
assessment and person-centered service plan development (under any
circumstances, determination of eligibility for the State plan HCBS
benefit cannot be performed by a HCBS provider or an entity with an
interest in providers of HCBS). Without this exception, states would be
unable to make State plan HCBS available to participants in these
areas. If a state employs this exception it must guarantee the
independence of this function(s) within the provider entity. In certain
circumstances, we may require that states develop ``firewall''
policies, for example, separating staff that perform assessments and
develop person-centered service plans from those that provide any of
the services in the plan; and meaningful and accessible procedures for
individuals and representatives to appeal to the state. We also will
not permit states to circumvent these requirements by adopting state or
local policies that suppress enrollment of any qualified and willing
provider.
Comment: A couple of commenters expressed concerns that an
independent agent may not have sufficient knowledge about the needs of
an individual, and that providers who have longer histories with the
individuals are better qualified to conduct evaluations and assessments
and develop care plans and would improve individuals' access to the
benefit. One indicated that independent agents may not have the
capacity to follow-up with individuals who are hard to reach, such as
individuals experiencing homelessness. Another indicated that we should
allow service providers within supportive housing to complete
assessments or it might unintentionally limit the availability of
supportive housing for HCBS beneficiaries. They suggest that CMS engage
independent agents in oversight activities to ensure individuals are
made aware of all available options and that providers do not
inappropriately advantage themselves.
Response: We recognize the importance of ensuring that the agents
responsible for the evaluations, assessment, and person-centered
service plans are trained in assessment of individual needs for HCBS
and knowledgeable about best practices. That is why we included
requirements at Sec. 441.730(a) for states to define in writing
standards for agents, and at Sec. 441.730(c), that these
qualifications must include training in assessment of individuals whose
physical or mental conditions trigger a potential need for home and
community-based services and supports, and current knowledge of best
practices to improve health and quality of life outcomes. We further
note that we understand that the process of developing appropriate
plans of care often requires the inclusion of individuals with
expertise in the provision of long-term services and supports or the
delivery of acute care medical services.
Comment: Another commenter stated that CMS's proposal to remove
providers from participating in assessments, evaluations, and plans of
care does not appear required by the DRA and requested that CMS remove
this prohibition on providers' ability to carry out these critical
functions and deliver the needed services to their beneficiaries.
Response: This rule does not prevent providers from participating
in these functions, but requires that an independent agent retains the
final responsibility for the evaluation, assessment, and person-
centered service plan functions. We understand that the process of
developing appropriate plans of care often requires the inclusion of
individuals with expertise in the provision of long-term services and
supports or the delivery of acute care
[[Page 2994]]
medical services. In order to meet the intent of the statute for
standards that safeguard against conflict of interest standards, we are
retaining these requirements as proposed.
Comment: Several commenters recommended that minimum safeguards/
standards be prescribed in the regulation, including standards related
to training, skills, and competency, with state flexibility to develop
additional standards and CMS reviewing the state standards for
approval. One recommended giving service providers and agencies rate
incentives to partner with training providers and community colleges to
ensure that the qualifications of the workforce meet the needs of their
clients. Others recommended adding that agents must have current
knowledge/training in evidence-based practices for assessment and
evidence-based best practices to improve health and quality of life
outcomes, person-centered planning, and informed decision making.
Another recommended that CMS identify broad competency areas and then
identify the specific skills associated with each of these competency
areas. Another noted that individuals performing assessments will need
to be sufficiently trained to assess cognitive impairment.
Response: Section 441.730(a) of the proposed rule would require
states to define in writing standards for agents, and at Sec.
441.730(c), that these qualifications must include training in
assessment of individuals whose physical or mental conditions trigger a
potential need for home and community-based services and supports, and
current knowledge of best practices to improve health and quality of
life outcomes. We agree with the commenters' suggestions and have added
``cognitive'' to Sec. 441.730(c).
Comment: One commenter encouraged the addition of language that
focuses on the qualifications, training and outcomes ``of the case
manager in the areas of case management, the populations they are
serving, funding and resources available in their community, the
offering of free choice of providers and service options and training
and expectations regarding conflict-free case management.''
Response: We note that we are not restricting the individuals or
entities who can perform these administrative activities to case
managers. We also note that conflict of interest requirements are found
at Sec. 441.730(b). We agree that knowledge of available resources,
service options, and providers is not an element specifically captured
in the proposed regulation language, so we have added language to Sec.
441.730(c).
Comment: A couple of commenters requested that CMS revise the
regulation to provide that the required training of agents must include
person-centered and family driven services planning, as well as
participant-directed practices.
Response: We believe that this idea is already reflected for
purposes in the broader phrase ``and current knowledge of best
practices to improve health and quality of life outcomes.''
Comment: One commenter pointed out that evaluators should also
obtain proper training and should be reflected in Sec. 441.668(c).
Response: The independent evaluators determine whether or not an
individual meets the eligibility requirements for the benefit, but
unless they are also the same entity responsible for the independent
assessment and plan of care development, we do not believe it would be
reasonable to require that they meet these minimum training
requirements that are appropriate minimum qualifications for agents
responsible for independent assessment and person-centered service plan
development (assessment of individuals whose physical or mental
conditions trigger a potential need for HCBS and supports, and current
knowledge of available resources, service options, providers, and best
practices to improve health and quality of life outcomes).
10. Definition of Individual's Representative (Sec. 441.735) (Proposed
Sec. 441.671)
In Sec. 441.671, we proposed to define the term ``individual's
representative'' to encompass any party who is authorized to represent
the individual for the purpose of making personal or health care
decisions, either under state law or under the policies of the State
Medicaid agency. We did not propose to regulate the relationship
between an individual enrolled in the State plan HCBS benefit and his
or her authorized representative, but noted that states should have
policies to assess for abuse or excessive control and ensure that
representatives conform to applicable state requirements. We noted that
states must not refuse to allow a freely-chosen person to serve as a
representative unless the state has tangible evidence that the
representative is not acting in the best interest of the individual, or
that the representative is incapable of performing the required
functions.
General Comments: All commenters for this section agreed with this
provision, and some additionally suggested some revision to the
language as described in the comments below.
Comment: A couple of commenters recommended changing ``family
member'' to ``a parent support provider.''
Response: The language in this phrase is statutory, from section
1915(i)(2) of the Act. The commenter did not provide any definition of
this term or explanation. For these reasons, we are unable to accept
this change as requested, but note that this provision at Sec.
441.735(b) is not an exhaustive list.
Comment: Another commenter expressed that an individual's
representative may not necessarily be the individual's guardian, but
some other representative freely chosen by the individual and important
to him or her.
Response: We agree and believe the language in the regulation
supports this as an option to the individual.
Comment: We received many comments about the term ``best
interest.'' Most of these commenters requested that CMS substitute the
term ``substituted judgment'' instead of ``best interest.'' One
cautioned that ``best interests'' may be a highly subjective
assessment, and stated their belief that substantial deference should
be established for the stated interests of the individual and the
decisions of their chosen representative. Others referenced guidelines
established by the National Guardianship Association (NGA), which
indicate that substituted judgment is a principle of decision-making
that promotes the self-determination of the beneficiary and that
substitutes, as the guiding force in any surrogate decision made by the
guardian, the decision the beneficiary themselves would make based on
their own preferences and wishes. This process involves consultation
with the individual and those important to the individual. If a
substituted judgment is not available, guardians can implement a ``best
interest'' principle, which considers all options and alternatives and
bases the decision on what a reasonable person would do in the given
situation.
Response: We agree with these commenters and have revised this
section of the regulation, Sec. 441.735(c), so that it now reads as
follows:
``When the state authorizes representatives in accordance with
paragraph (b) of this section, the state must have policies
describing the process for authorization; the extent of decision-
making authorized; and safeguards to ensure that the representative
uses substituted judgment on behalf of the individual. State
policies must address exceptions to using substituted judgment when
the individual's wishes cannot be ascertained or when the
individual's wishes would result in substantial harm to the
[[Page 2995]]
individual. States may not refuse to recognize the authorized
representative that the individual chooses, unless in the process of
applying the requirements for authorization, the state discovers and
can document evidence that the representative is not acting in
accordance with these policies or cannot perform the required
functions. States must continue to meet the requirements regarding
the person centered planning process at Sec. 441.725 of the rule.''
Comment: We received one comment about state laws regarding
guardianship and the jurisdiction of the courts, in which they stated
that guardians are appointed by the court, not chosen by the
individual.
Response: We believe this concept is captured with the use of the
term ``legal'' prior to ``guardian'' in the language of the final
regulation at Sec. 441.735(a) which pertains to a legal guardian
authorized under State law to represent the individual. We note that
the provision at Sec. 441.735(c) only applies to individuals specified
at Sec. 441.735(b) who are authorized under the policy of the State
Medicaid agency to represent the individual.
Comment: A couple of commenters confirmed the importance of
participants' access to a representative option. One requested that CMS
add ``States should ensure that representatives conform to good
practice concerning free choice of the individual, and assess for abuse
or excessive control.'' Another stated that supports providers (for
example, consultants, support brokers) need to be appropriately trained
on the participant direction paradigm to be prepared to successfully
identify when a representative may be using ``excessive control'' as
well as to enforce ``free choice'' of representatives.
Response: If by ``free choice of the individual'' the commenter
means the individual's free choice of providers, this Medicaid
requirement at section 1902(a)(23) of the Act is not waived or
disregarded under section 1915(i) of the Act and is not a subject of
this rule. We believe that the proposed language broadly covers the
other elements of this comment, and we will consider addressing this
issue further in future guidance.
Comment: One commenter requested that the word ``should'' be
replaced with ``must'' or ``implement policies to.''
Response: The proposed and final regulation language does not
contain the word ``should.''
Comment: One commenter expressed the need for a representative to
be identified by the participant after s/he is well informed of the
program and his/her responsibilities. They further commented that
effective practices for identifying and choosing representatives should
be shared with the participants during program orientation and as
needed.
Response: We believe this would be an example of a good state
practice, which we will consider for inclusion in future guidance.
Comment: One commenter stated that based on the general principles
of participant direction, states should not require that individuals
have representatives without prior attempts to train and support the
participant.
Response: The purpose of this provision is not to require an
individual to have a representative but it is to require states to
allow the option for an individual to choose a representative for the
purpose of participating in decisions related to the person's care or
well-being when the individual requires assistance in making such
decisions, and to have policies for the process for authorization, the
extent of decision-making authorized, and safeguards. We note that
where a legal guardian, conservator, or other person has the sole
authority under state law to make decisions related to the individual's
care, the state must comply with the decisions of the legal surrogate.
Comment: One commenter requested that the following language from
the preamble of the proposed rule, or something similar, be added to
the actual regulation text: ``. . . process should still be focused on
the individual requiring services, and that supports should be provided
to allow the individual to meaningfully participate and direct the
process to the maximum extent possible.''
Response: We have added the following to Sec. 441.735(c) of this
rule:
``States must continue to meet the requirements regarding the
person-centered planning process at Section 441.725 of this rule.''
11. Self-Directed Services (Sec. 441.740) (Proposed Sec. 441.674)
Section 1915(i)(1)(G)(iii)(I) and (II) of the Act provides that
states may offer enrolled individuals the option to self-direct some or
all of the State Plan HCBS that they require. Self-directed State plan
HCBS allow states another avenue by which they may afford individuals
maximum choice and control over the delivery of services, while
comporting with all other applicable provisions of Medicaid law. We
have urged all states to afford waiver participants the opportunity to
direct some or all of their waiver services, without regard to their
support needs. With the release of an updated, revised section 1915(c)
of the Act waiver application in 2008, we refined the criteria and
guidance to states surrounding self-direction (also referred to as
participant-direction), and established a process by which states are
encouraged, to whatever degree feasible, to include self-direction as a
component of their overall HCBS waiver programs. While section 1915(i)
of the Act does not require that states follow the guidelines for
section 1915(c) of the Act waivers in implementing self-direction in
the State plan HCBS benefit, we anticipate that states will make use of
their experience with section 1915(c) of the Act waivers to offer a
similar pattern of self-directed opportunities with meaningful supports
and effective protections.
Comment: Several commenters recommended that CMS include training
as one aspect of employer-authority activities that self-directing
beneficiaries may be allowed to exercise. A couple of commenters urged
CMS to require states to offer training for individuals on selecting,
hiring, supervising and firing service providers, in addition to
service provider training.
Response: We agree with this recommendation and have added the
following to the Sec. 441.740(e)(3):
``Voluntary training on how to select, manage, and dismiss
providers of State plan HCBS.''
We note that many states currently have existing training programs
available that could potentially be leveraged or modified to meet such
a requirement. Training programs should be able to meet the needs of
individuals at varying levels of need with regard to selecting,
managing, and dismissing providers. Consistent with the philosophy of
self-direction, this training must be voluntary, and may not be a
mandatory requirement for the individual to receive services under this
option.
Comment: One commenter requested training for agents conducting
evaluations, assessments, and service planning.
Response: Training for agents conducting evaluations, assessments,
and person-centered service planning is a requirement that was
stipulated under the proposed rule at Sec. 441.668, provider
qualifications, and remains unchanged in this final rule at Sec.
441.730.
Comment: One commenter recommended that CMS consider requiring
states to provide joint trainings for both consumers and providers, as
they have resulted in improved services, better
[[Page 2996]]
communication and a stronger relationship.
Response: We believe that this would be more suited as one option
that a state could put into practice to meet training requirements.
Comment: One commenter indicated that states should be provided
guidance on elements that are important for participant direction
assessment (for example, strengths, abilities, individual goals, need
for a representative, capacity to self-direct with an eye for
developing a support system to ensure success in self-directing, and
risks).
Response: These elements are already required under Sec.
441.725(b), pertaining to the person-centered service plan.
Comment: One commenter applauded CMS for their inclusion of
participant direction support functions, stating that they are well
documented by research and that successful participant direction
opportunities are dependent on the appropriate execution of each of
these support functions. The commenter requests that CMS describe
within the rule the elements of each of these functions (as seen with
the financial management services function).
Response: We appreciate the support of the commenter. Experience
with section 1915(c) of the Act and other Medicaid HCBS authorities
have been instrumental in demonstrating the importance of the
availability of information, assistance, and support to participants
who self-direct their HCBS. Since the purpose of this regulation is to
stipulate the minimum requirements that states must meet for the
section 1915(i) of the Act authority, we believe the commenter's
request will be best suited as future sub-regulatory guidance/policy.
Comment: One commenter expressed appreciation of well-structured
definitions for both employer authority and budget authority, and
recommended an edit to the ``employer authority'' definition to ensure
its consistency with existing best practices: replace the ``or'' in
``the ability to select, manage, or dismiss providers of State plan
HCBS'' with an ``and'' since the ability to do all three functions is
critical to the model.
Response: Since each of these functions is optional, and we want to
ensure that the protections at Sec. 441.740(c) are provided with
selection of any of these optional functions, we are unable to adopt
the commenter's recommended revision.
Comment: Several commenters requested revising the provisions
related to budget authority in Sec. 441.674(d)(5) to make it clear
that self-directing individuals with budget authority may be allowed to
pay providers directly. Another commenter requested revision to Sec.
441.674(e)(2)(iii) of the proposed rule to clarify that employer-
related financial transactions, such as paying worker wages and taxes,
may also be made for individuals with employer authority.
Response: Section 1915(i) of the Act does not give states the
authority to allow participants to perform transactions or convey cash
to the individual or representative. It does allow for budget authority
to grant individuals control of expenditures. In addition, with
sufficient state Medicaid agency process and oversight, states may
choose to employ alternate methods to maximize participant autonomy
within the parameters of the section 1915(i) of the Act authority.
Comment: One commenter requested that we add a requirement to Sec.
441.674(b)(4) that ``there are state procedures to ensure the
continuity of services during the transition from self-direction to
other models of service.''
Response: We agree with this comment and have added additional
language to the rule at Sec. 441.740(b)(4).
Comment: One commenter requested that Sec. 441.674(d) regarding
budget authority require that the service plan specify the authority to
be assumed by the individual, any limits to the authority, and specify
parties responsible for functions outside of the authority to be
assumed.
Response: The commenter's request is already addressed in the
requirement as included in the proposed rule under Sec. 441.674(b)(2),
which we are finalizing at Sec. 441.740(b)(2).
Comment: Section Sec. 441.674(e)(2) regarding financial management
supports should clarify that federal financial participation (FFP) is
available for this service.
Response: States have the option of providing this type of activity
as a Medicaid administrative activity or as a Medicaid service, as long
as the activity meets Medicaid requirements. It is not necessary for
this to be specified in the text of the regulation. We will explain
these options in future guidance.
Comment: One commenter requested clarification to indicate that a
state may provide for employer functions itself, or through a fiscal/
employer agent or other state-contracted entity under the state's
direction and control. They stated that it should also be clear that
states have the option to offer these supports to individuals directly
or through a public entity.
Response: States have the option of providing this type of activity
as a Medicaid administrative activity or as a Medicaid service, as long
as the activity meets Medicaid requirements. We do not believe that
this degree of specificity would be appropriate as a requirement under
regulation text, but will be considered in the development of any
future guidance.
Comment: Two commenters requested CMS to revise the requirement
that states offer individual supports so that it includes peer-to peer
support and family-driven care.
Response: While we agree that these are important supports that
states should consider making available to individuals, we do not
believe that this degree of specificity would be appropriate as a
requirement under regulation text. We will however, consider this in
the future development of additional guidance.
Comment: Two commenters indicated that it is unclear what is meant
by, and stated concerns about, the statement that evaluation results
will lead to the determination of ``ability to self-direct [both with
and without specific supports].'' One of these commenters expressed
support of any evaluation criteria that encourages an individual to
personally assess his/her interests and abilities to self-direct while
not leading to professional decisions made in isolation based solely on
the individual's disability, personal characteristics, or experiences.
The other commenter stated the belief that, with appropriate supports,
essentially all individuals are able to self-direct, using Michael
Weymeyer's concept of the individual as causal agent in their life, and
that it is hard to understand the purpose of determining the ability of
someone to self-direct without supports. Both agree that a person-
centered system that includes participant direction should be able to
support people to make informed decisions pertaining to their care
while providing the individualized support s/he needs to successfully
self-direct.
Response: The purpose of inclusion of ``without supports'' in this
paragraph is to be inclusive of the individual's option to not avail
him/herself of the opportunity to use the self-directed supports that
states are required to offer under this option, while also preserving
the responsibility of states to ensure that the individual receives the
needed services in accordance with his/her person-centered service
plan.
Comment: One commenter stated that self-directed service plans
should be aligned with the most integrated setting definition under the
ADA and Olmstead and recommended additional language be added under
Sec. 441.674(b).
[[Page 2997]]
Response: This recommendation is already captured under Sec.
441.725(b)(1), which pertains to all person-centered service plans.
Comment: One commenter expressed an opinion about the requirement
in the proposed rule that the service plan indicate not only the
services that will be self-directed, but also the ``methods by which
the individual will plan, direct, or control these services.'' The
commenter expressed that this language is dangerously vague, and as a
result, may lead to specificity within the service plan that is not
sensitive to the flexible and dynamic processes required for successful
participant direction.
Response: This language is referring to participant preferences
with regards to how they choose to self-direct their services,
including employer and/or budget authority if elected by the state.
More detail and requirements regarding these two authorities is
specified under Sec. 441.740(c) and (d).
Comment: One commenter stated the importance of individualized
contingency plans as being well stated, and appropriate in the proposed
regulation. Another stated that risk management techniques should not
interfere with the right to self-direct and other choices and rights
unless there is a documented, clear, concrete danger present. Another
commenter indicated that it is important that participant direction
philosophy inform any risk management techniques, which are required in
the proposed rule to be listed in the service plan, with the
participant leading the process and creating back-up plans unique to
his/her needs. The commenter also supports a transparent individual
budget development and monitoring process, but at the same time
recognizes the importance of providing participants with accessible
information that is not too overwhelming and easy to digest. They
recommend that any tools for this purpose be simple and straight
forward, making them accessible to all program participants.
Response: We appreciate and agree with these comments and will
consider them for inclusion in future guidance.
Comment: One commenter indicated that states are using the self-
directed option to save money, and that self-directed services are
often reimbursed at a lower rate than agency-directed services for no
clear reason, causing wages for workers in self-directed programs to be
substantially lower than wages for agency-controlled workers.
Response: Self-directed provision of services provides the states
with the option to give individuals the flexibility to negotiate
preferred rates for services, frequently with individuals that have a
pre-existing relationship with the consumer, for example, a friend or
neighbor. This may result in costs for services that are lower than
comparable services provided by an agency. The rates selected by
individuals who are self-directing may or may not include the
administrative overhead that occurs when an agency employs individual
workers to provide services.
Comment: Several commenters stated that self-direction as a
delivery method and supports to participants to self-direct, should be
required and not state options. Another stated that agency-based
services should be available only for those who cannot manage self-
direction (with supports) and have no authorized representative.
Response: Section 1915(i)(G)(iii) of the Act allows states the
option to offer individual election for self-directed services. The
statute does not include the authority for the Secretary to require
that the services that states offer under section 1915(i) of the Act
must be self-directed. For states that choose to offer individual
election to self-direct their HCBS, states must make information and
assistance available to those individuals to support their direction of
services.
Comment: One commenter applauded the ability for states to allow
participants to direct any or all of the State plan HCBS benefit, and
stated the potential for confusion, unnecessary complexity, and limited
control when states decide to limit the ability to self-direct to one
specific service. They strongly recommended that states receive
technical assistance and guidance on the benefits of participant
direction and how to implement participant direction opportunities to
the furthest extent possible, including providing access to an
individual budget model.
Response: We appreciate these comments. We are available to provide
guidance and assistance to states and encourage states to contact us
with any such requests.
Comment: One commenter stated that the following statement is
extremely vague and requires clarification: ``According to the proposed
rule, individuals who choose to self-direct will be subject to the
`same requirements' as other enrollees in the State plan HCBS
benefit.'' They stated that it is important that any requirements
created be sensitive to the participant direction philosophy and
informed by evidence-based participant direction practices.
Response: This statement in the preamble was only stating that the
other requirements of section 1915(i) of the Act, such as eligibility,
adjustment authority, independent evaluation and assessment, person-
centered service plan, etc., are still requirements that must be
applied for individuals who choose to self-direct their services.
Additional requirements specific to the self-direction option were
included in the proposed rule, and were based on our experience with
section 1915(c) of the Act waivers and other Medicaid authorities in
order to include a similar pattern of self-directed opportunities with
meaningful supports and effective protections.
Comment: One commenter stated the assumption that states have the
option to provide program participants with employer authority or
budget authority (as opposed to requiring both), but indicated that
they find the language in the proposed rule pertaining to this point
vague.
Response: Section 441.740(b)(2) already specifies ``and/or'' to
indicate this option.
Comment: One commenter, with a reminder that the proposed rule
allows states to enter into a ``co-employer'' relationship with
participants, stated that it is important to recognize that there is no
one standard definition for ``Agency with Choice,'' leading to
inconsistent application and monitoring of this model. The commenter
strongly encouraged CMS, in collaboration with the Department of Labor
and informed by existing state labor laws and stakeholders, to set
standards for the ``Agency with Choice'' model that are reflective of
the participant direction paradigm and the liabilities specific to this
model.
Response: We appreciate this comment and will take it under
consideration in the development of future guidance.
Comment: One commenter recommended that Sec. 441.674(b) include a
reference to Sec. 441.674(e) requiring self-direction supports to be
included in the service plan, since paragraph (e) is cross- referenced
in other paragraphs, at Sec. 441.674(c)(2) and Sec. 441.674(d)(4)).
Response: After consideration of this comment, we believe the
inclusion of this requirement under both Sec. 441.740(c)(2) and (d)(4)
is repetitive and would be better placed under Sec. 441.740(b) as a
new paragraph (5). Therefore, we made this addition to Sec. 441.740.
Comment: One commenter recommended that Sec. 441.674(e) should
explicitly include the requirement suggested in the preamble (77 Fed.
Reg. 26373, first column) for an ``independent advocate.''
[[Page 2998]]
Response: We are not adding this as a requirement to this final
rule. However, we believe the availability of an independent advocate
to assist the individual with the access to and oversight of their
waiver services, including self-direction, is an important component of
a strong self-directed system.
Comment: One commenter recommended that CMS explain, in Sec.
441.674(a), that individuals should be encouraged to retain authority
over all functions (budgeting, staffing, etc.), but that individuals
could choose only to retain authority over specific functions. They
also recommended that CMS add the term ``, but not limited to,'' after
the term ``including.''
Response: The purpose of Sec. 441.740(a) is to specify the state
option to offer the election for self-directing HCBS. The language that
the commenter has suggested would not be appropriate for this
regulation since it would not stipulate a state requirement. Regarding
the second comment, we do not agree with leaving this open-ended, and
since it is unclear what else would be self-directed in addition to
amount, duration, scope, provider, and location of the HCBS, we are
unable to make the suggested revision.
Comment: One commenter urges CMS to promote matching service
registries as robust models of information and assistance as a way to
assist participants with identifying and accessing independent
providers.
Response: We appreciate this comment and will consider it for
inclusion in future guidance.
12. State Plan HCBS Administration: State Responsibilities and Quality
Improvement (Sec. 441.745) (Proposed Sec. 441.677)
a. State Responsibilities
States are required to provide CMS annually with the projected
number of individuals to be enrolled in the benefit, and the actual
number of unduplicated individuals enrolled in the State plan HCBS
benefit in the previous year. Section 1915(i) of the Act authorizes a
state to elect not to apply comparability requirements, thus permitting
states to target the entire section 1915(i) of the Act benefit,
specific services within the benefit, or both. Under Sec.
441.745(a)(1)(ii), we specify that the state may not limit enrollee
access to services in the benefit for any reason other than assessed
need or targeting criteria. This includes the requirement that services
be provided to all individuals who are assessed to meet the targeting
criteria and needs-based criteria, regardless of income. This is an
important distinction between the limits states place on the services
to be offered when they design the benefit, as opposed to limiting
access to the services that are in the benefit for particular enrolled
individuals. As discussed in the proposed rule, states have a number of
permitted methods to control utilization. We proposed that once an
individual is found eligible and enrolled in the benefit, access to
covered services can be limited on the basis of the needs-based
criteria as evaluated by the independent assessment and incorporated
into the person-centered service plan. By not limiting access, we mean
that an enrollee must receive any or all of the HCBS offered by the
benefit, in scope and frequency up to any limits on those services
defined in the state plan, to the degree the enrollee is determined to
need them. Enrollees should receive no more, and no fewer, HCBS than
they are determined to require.
b. Administration
We proposed in Sec. 441.677(a)(2)(i) an option for presumptive
payment. In accordance with section 1915(i) of the Act, the state may
provide for a period of presumptive payment, not to exceed 60 days, for
evaluation of eligibility for the State plan HCBS benefit and
assessment of need for HCBS. This period of presumptive payment would
be available for individuals who have been determined to be Medicaid
eligible, and whom the state has reason to believe may be eligible for
the State plan HCBS benefit. We proposed that FFP would be available
for evaluation and assessment as administration of the approved state
plan prior to an individual's determination of eligibility for and
receipt of other section 1915(i) of the Act services. If the individual
is found not eligible for the State plan HCBS benefit, the state may
claim the evaluation and assessment as administration, even though the
individual would not be considered to have participated in the benefit
for purposes of determining the annual number of individuals served by
the benefit. FFP would not be available during this presumptive period
for receipt of State plan HCBS.
In Sec. 441.677(a)(2)(ii), we proposed that a state may elect to
phase-in the provision of services or the enrollment of individuals if
the state also elects not to apply comparability requirements and to
target the benefit to specific populations. However, there is no
authority to limit the numerical enrollment in the benefit or to create
waiting lists. Therefore, we proposed that any phase-in of services may
not be based on a numerical cap on enrollees. Instead, a state may
choose to phase-in the benefit or the provision of specific services
based on the assessed needs of individuals, the availability of
infrastructure to provide services, or both. Infrastructure is defined
as the availability of qualified providers or of physical structures
and information technology necessary to provide any service or set of
services. A state that elects to phase-in the benefit must submit a
plan, subject to CMS approval, that details the criteria used for
phasing in the benefit. In the event that a state elects to phase-in
the benefit based on needs, all individuals who meet the criteria
described in the phase-in plan must receive covered services. If a
state elects to phase-in services based upon infrastructure, the plan
must describe the capacity limits, strategies to increase capacity, and
must assure that covered services will be provided to all individuals
who are able to acquire a willing and qualified provider. Any phase-in
plan must provide assurance that the benefit, and all included
services, will be available statewide to all eligible individuals
within the first 5-year approval period.
In Sec. 441.677(a)(2)(iii), we proposed that a state plan
amendment submitted to establish the State plan HCBS benefit must
include a reimbursement methodology for each covered service. In some
states, reimbursement methods for self-directed services may differ
from the same service provided without self-direction. In such cases,
the reimbursement methodology for the self-directed services must also
be described.
In Sec. 441.677(a)(2)(iv), we proposed that the state Medicaid
agency describe the line of authority for operating the State plan HCBS
benefit. The State plan HCBS benefit requires several functions to be
performed in addition to the service(s) provided, such as eligibility
evaluation, assessment, and developing a person-centered service plan.
To the extent that the state Medicaid agency delegates these functions
to other entities, we proposed that the agency describe the methods by
which it will retain oversight and responsibility for those activities,
and for the operation and quality improvement of the benefit as a
whole. Delegation of responsibilities by the state Medicaid agency must
comply with the single state agency requirements of section 1902(a)(5)
of the Act and Sec. 431.10.
In Sec. 441.677(a)(2)(v), we included a provision regarding the
effective dates of amendments with substantive changes. Substantive
changes may
[[Page 2999]]
include, but are not limited to changes in eligible populations,
constriction of service amount, duration or scope, or other
modifications as determined by the Secretary. We added regulatory
language reflective of our guidance that section 1915(i) of the Act
amendments with changes that CMS determines to be substantive may only
take effect on or after the date when the amendment is approved by CMS,
and must be accompanied by information on how the State has assured
smooth transitions and minimal adverse impact on individuals impacted
by the change.
In Sec. 441.677(a)(2)(vi), we indicated that State plan amendments
including targeting criteria are subject to a 5-year approval period
and that successive approval periods are subject to CMS approval,
contingent upon state adherence to federal requirements. In order to
renew State plan HCBS for an additional 5-year period, the state must
provide a written request for renewal to CMS at least 180 days prior to
the end of each approval period.
c. Quality Improvement Strategy
We proposed in Sec. 441.677(b) requirements for quality assurance
which states are required to meet under section 1915(i)(1)(H)(i) of the
Act. We proposed to require a state, for quality assurance purposes, to
maintain a quality improvement strategy for its State plan HCBS
benefit. The state's quality improvement strategy should reflect the
nature and scope of the benefit the State will provide. We proposed
that the State plan HCBS benefit include a quality improvement strategy
consisting of a continuous quality improvement process, and outcome
measures for program performance, quality of care, and individual
experience, as approved and prescribed by the Secretary, and applicable
to the nature of the benefit. In Sec. 441.677(b), we proposed to
require states to have program performance measures, appropriate to the
scope of the benefit, designed to evaluate the state's overall system
for providing HCBS. Program performance measures can be described as
process and infrastructure measures, such as whether plans of care are
developed in a timely and appropriate manner, or whether all providers
meet the required qualifications to provide services under the benefit.
In Sec. 441.677(b)(1), we also proposed to require states to have
quality of care measures as approved or prescribed by the Secretary.
Quality of care measures may focus on program standards, systems
performance, and individual outcomes.
Comment: A commenter stated that the proposed regulations would
result in cut backs, loss of jobs, and subsequent loss of care for
people who cannot survive without assistance with all their basic
needs.
Response: These regulations explain requirements for a new
provision that provides states with the option to add additional HCBS
to their state plan. Since these regulations allow for new additional
services, we do not see how this would result in the impact that the
commenter suggests.
Comment: One commenter requested revision to Sec.
441.677(a)(1)(iii) to add to the requirements advance written notice
and the right to appeal denials.
Response: This provision of this rule refers to requirements at
part 431, subpart E, which is not a subject of this regulation.
However, since advance notice is a topic in part 431, subpart E, we
have added ``advance notice'' to this regulation at Sec.
441.745(a)(1)(iii).
Comment: One commenter stated the belief that operating different
parts of the state plan under different rules would be burdensome to
states, and opposition to Sec. 441.677(a)(2)(v), which would impose
rules for effective dates of state plan amendments that differ from
current state plan amendment policy.
Response: As explained in the preamble to the rule, and as required
at Sec. 441.745(a)(2)(v), state plan amendments which result in a
reduction of eligibility or services to section 1915(i) of the Act
participants must be submitted with a prospective, rather than
retroactive, effective date. While this requirement differs from
current SPA procedures, it is consistent with section 1915(c) of the
Act submissions. And as section 1915(i) of the Act allows states to add
services under section 1915(c)(4)(B) of the Act, we are requiring
states submitting section 1915(i) of the Act SPAs to follow the same
requirements for those section 1915(c) services outlined in CMS CMCS
Bulletin dated April 16, 2012, regarding actions that result in
reductions. If a state submits an amendment or renewal to an approved
SPA that includes reductions, the reductions would be effective for the
remainder of the approved period (once approved), but cannot be applied
retroactively to the SPA action's approval date.
Comment: One commenter agreed that retroactive amendments should
not be available for elimination or reductions in services, but does
not consider changes to provider qualifications or rate methodologies
to be substantive changes. The commenter stated that defining
substantive change to include changes to rate methodology or provider
requirements prevents states from acting quickly and efficiently to
address legislative direction or changing state needs.
Response: We disagree. Since changes to provider qualifications
and/or rate methodologies could negatively impact provider availability
and result in a reduction of services to a participant, we are
requiring a state to submit such SPAs, and receive CMS approval, prior
to implementing any changes of this nature.
Comment: One commenter stated disagreement with Sec.
441.677(a)(2)(vi), limiting approval period for SPAs with targeting to
5 years and requiring submission of renewals 180 days in advance of
expiration, and indicated that these provisions seem contrary to
requirements for services under the state plan and are like the
creation of a new waiver authority.
Response: Section 1915(i)(7)(B) of the Act specifies that when a
state elects to target the provision of State plan HCBS to specific
populations, that this election will be for a period of 5 years.
Therefore, since the 5 year period of operation with the option to
renew is a statutory requirement, we are unable to change this
provision. Section 1915(i)(7)(C) of the Act permits states to renew for
additional 5 year terms if we determine prior to the beginning of each
renewal period that the state has adhered to section 1915(i) of the Act
requirements and that the state has met its objectives with respect to
quality improvement and individual participant outcomes. In order for
us to determine that these requirements are met, states must submit
renewal SPAs at least 180 days in advance of expiration in order to
allow us sufficient time to review. The need for this review timeframe
is consistent with our experience under section 1915(c) of the Act
renewals.
Comment: A few commenters recommended that CMS add to the periods
of approval requirement for states that elect to target specific
populations at Sec. 441.677(a)(2)(vi), so that it specifically
includes the statutory renewal requirement at section 1915(i)(7)(c)(ii)
to meet ``the state's objectives with respect to quality improvement
and beneficiary outcomes.'' They stressed the importance of quality
improvement and good beneficiary outcomes, and indicated that a State
plan HCBS benefit should not be renewed if it cannot meet such
criteria.
Response: We agree with these commenters and have revised Sec.
441.745(a)(2)(vi) accordingly.
Comment: We received many comments regarding the option for
[[Page 3000]]
presumptive payment at Sec. 441.677(a)(2)(i), as noted below:
``CMS should clarify that home and community-based
services furnished to individuals in the 3 months prior to a final
determination of eligibility are also eligible for FFP once eligibility
has been confirmed.''
``Presumptive Eligibility is confusing, and should not be
limited to evaluations and assessment; however, if someone needed
medical data to prove eligibility including disability determination,
those services should be provided.''
``. . . encourages CMS to take this authority one step
further to permit, on a time limited basis, federal financial
participation for State plan HCBS furnished to consumers who are
presumptively enrolled.''
``Please clarify that the availability of Federal
financial participation for medically necessary State plan HCBS benefit
payments under this option when the individual beneficiary has been
found not to be eligible, allows states to hold the beneficiary
harmless for the state financial portion.''
``We strongly encourage CMS to use its discretion, if
possible, to include payment for the HCBS which a state believes the
individual would be eligible to receive. This expanded authority is
especially important in emergency situations, such as avoiding
institutional care.''
``We support the creation of flexibility for states to
provide HCBS based on presumed eligibility for assessment due to the
fact that many disabilities occur rather suddenly, and because there is
no guarantee as to when informal support networks may give out or
end.''
``We commend the inclusion of authority in Sec.
441.677(a)(2) to allow presumptive payment for HCBS evaluations and
assessments, and the provision to allow FFP in the cases where
presumptive payment was made based on good faith.''
Response: We appreciate these comments. Section 1915(i)(1)(J) of
the Act gives states the option of providing for a period of
presumptive eligibility, not to exceed 60 days, for individuals the
state has reason to believe may be eligible for the State plan HCBS
benefit. However, eligibility for services under section 1915(i) of the
Act is not the same as an eligibility determination for Medicaid
generally, as this provision ``shall be limited to medical assistance
for carrying out the independent evaluation and assessment'' under
section 1915(i)(1)(E) of the Act. Therefore, for clarity, we refer to
this limited option as ``presumptive payment.'' Since individuals not
eligible for Medicaid may not receive State plan HCBS, the statutory
phrase ``and if the individual is so eligible, the specific HCBS that
the individual will receive,'' is further describing the assessment
under section 1915(i)(1)(E) of the Act for which presumptive payment is
available. Payment for State plan HCBS is available once the individual
is determined eligible, and not prior to that point. However, FFP would
be available for both 1905(a) services and administrative costs
incurred for evaluation and assessment activities for individuals who
are already eligible for Medicaid. During any such period of
presumptive payment, the individual would not receive State plan HCBS,
and would not be considered to be enrolled in Medicaid or eligible for
the HCBS benefit for purposes of computing the number of individuals
being served under the benefit.
Comment: One commenter requested clarification as to how states
must ensure people are able to move from a needs-based criteria
benefits package to benefits that require a level of care. They also
requested guidance to states as to how they will monitor for unexpected
changes in services and support needs, which might result in the need
for services associated with an institutional level of care. They asked
that we provide guidance on time lines and processes for conducting
level of care assessments as well as for enrolling individuals in a
program or benefit that requires a level of care that will best meet
their needs.
Response: In order to receive approval of a section 1915(i) of the
Act SPA, states must establish that the institutional level of care is
based on needs-based criteria that are more stringent than the proposed
section 1915(i) of the Act needs-based criteria. Although states are
required to establish minimum needs-based criteria that an individual
would have to meet in order to receive section 1915(i) benefits, the
statute did not establish a maximum or ceiling. Therefore, states are
permitted to allow access to those who meet institutional needs-based
eligibility criteria. We also note that Sec. 441.715(e) requires
states to re-evaluate and re-assess individuals receiving the State
plan HCBS benefit at least every 12 months, and when the individual's
circumstances or needs change significantly or at the request of the
individual.
Comment: In Sec. 441.677 (a)(1)(i), no details are provided about
how states would ``project'' HCBS enrollment. This is a critical
calculation because states might have an incentive to understate
projections to gain the discretion associated with over-enrollment.
Response: We do not believe it is necessary to include such details
in the regulation. We note that this paragraph also requires states to
report the actual numbers of unduplicated individuals enrolled in the
State plan HCBS benefit on an annual basis.
Comment: One commenter commended CMS on the inclusion of Sec.
441.677(a)(1)(ii)(C) prohibiting the state from limiting access to HCBS
based on income, cost, or location.
Response: We appreciate the support of the commenter regarding the
inclusion of this requirement which is now at Sec.
441.745(a)(1)(ii)(C).
Comment: One commenter recommended that CMS require that states
make publicly available targeting, phase-in, and quality improvement
plans, including by posting on public Web sites.
Response: At this time, we do not post state plans on our Web site.
We are working on a project to make approved state plans publicly
available. We encourage states to provide for effective public
engagement in all of their Medicaid program activities, and states are
required to provide 60 day public notice when states change
reimbursement methodology or revise CMS approved section 1915(i) of the
Act needs-based criteria.
Comment: A couple of commenters noted that Sec.
441.677(a)(1)(ii)(B) incorrectly cross-references Sec. 441.656(b)(2),
which should be changed to Sec. 441.656(e)(2).
Response: We appreciate this comment and have made a revision to
this final rule at Sec. 441.745(a)(1)(ii)(B) with the corrected cross-
reference to Sec. 441.710(e)(2).
Comment: One commenter expressed that CMS should consider requiring
states to report on quality measures related to home and community-
based settings and community integration for HCBS provided under
sections 1915(k), 1915(c), and 1915(i) of the Act.
Response: We agree. States are required to demonstrate at the time
of approval that they have quality measures in place with a monitoring
plan, must include them in the SPA or waiver, and will report to CMS at
a frequency to be determined by CMS or upon request by CMS.
Comment: One commenter emphasized the important role that non-
medical quality measures play in the meaningful evaluation of HCBS. The
commenter stated that quality measures should reflect the ultimate
mandate resulting from the Olmstead decision and the importance of
quality of life,
[[Page 3001]]
independence, and community integration. The commenter further stated
that for those who choose participant direction, measures sensitive to
this mode of service delivery need to be implemented, including
measures that recognize the role of participants as decision makers and
evaluators of the quality of services and supports they receive.
Response: We recognize the importance of non-medical quality
measures and will incorporate these areas (quality of life, community
integration and factors specific to participant-directed services) in
development of future guidance.
Comment: One commenter noted that due to reported abuses in some
states, it must be clear that observation of actual conditions, through
on-site monitoring and review and by interviews with service recipients
and their advocates and family members, will be the method used to
measure compliance; and not simply by reviewing policies, procedures,
or assertions. The commenter further stated that it is crucial that the
final rule contain the details so CMS has the legal authority to
prevent creation of new loopholes or allow for misinterpretation.
Response: There may be multiple methods of monitoring health and
welfare in a quality monitoring plan. States are required by the
regulation to have a quality improvement strategy consisting of a
continuous quality improvement process, and outcome measures for
program performance, quality of care, and individual experience.
Comment: A commenter inquired about the applicability of the state
assurances for HCBS waiver programs required by Sec. 441.302,
particularly Sec. 441.302(a) Health and Welfare, noting that there is
equivalent vulnerability potential for individual beneficiaries
receiving HCBS under state plan authority as under section 1915(c) of
the Act waiver authority.
Response: The regulations noted by this commenter specifically
apply to section 1915(c) of the Act home and community-based waiver
services and do not specifically apply to section 1915(i) of the Act
State plan HCBS. The regulations that implement section
1915(i)(1)(H)(i) of the Act, which requires states to ensure that the
provision of HCBS meets federal and state guidelines for quality
assurance, can be found in Sec. 441.745(b) and require that states
have a quality improvement strategy consisting of a continuous quality
improvement process, and outcome measures for program performance,
quality of care, and individual experience.
Comment: One commenter encouraged CMS to require states to submit
their quality improvement strategy to CMS at a specific frequency and
consider making such information public.
Response: We have required through these regulations that states
make this information available to CMS at a frequency determined by CMS
or upon the request of CMS. We will consider further specification of
these requirements in the development of future guidance.
Comment: One commenter recommended revision to Sec.
441.677(b)(1)(ii) to include the following language from the preamble
in the text of the final rule: ``Be evidence-based, and include outcome
measures for program performance, quality of care, and individual
experience as determined by the Secretary.''
Response: This recommendation has been adopted in this final rule
at Sec. 441.745(b)(1)(ii).
Comment: One commenter noted that in order to determine if there is
a sufficient infrastructure to effectively implement HCBS, it is
necessary for states to gather direct-care worker data such as numbers
of direct service workers, gaps in services data, stability of
workforce, and average compensation of workers.
Response: We agree that this would be useful data for states to
consider in the development of a State plan HCBS benefit, but we have
not required specific measures, such as the one recommended by the
commenter.
Comment: One commenter further encouraged CMS to consider how
quality principles/requirements would work within the management of
long term services and supports and its impact on network adequacy.
Response: We appreciate the commenter's recommendation and will
take this under consideration as we develop future guidance.
13. Prohibition Against Reassignment of Provider Claims (Sec. 447.10)
Regarding the proposed provider payment reassignment provision, we
received a total of 7 timely items of correspondence from home care
provider representatives and other professional associations, state
Medicaid directors, non-profit organizations, and other individuals.
These comments ranged from general support for the proposed provision,
to specific questions and detailed comments and recommendations
regarding the proposed changes. A summary of the public comments and
our responses are set forth below.
The proposed rule included a provision, retained in this final
rule, that will allow states to enter into third party payment
arrangements on behalf of individual practitioners for health and
welfare benefit contributions, training costs, and other costs
customary for employees.
Comment: Several commenters expressed support for the proposed
provision. Two state Medicaid agency directors appreciate the
clarification that third party payments on behalf of certain providers
are allowed for customary benefits. That ability, they recommend, is
essential and cost-effective for a large group of individual providers
of personal care.
Response: We appreciate the commenters' support for the proposed
provision. CMS has long sought to ensure maximum state flexibility to
design state-specific payment methodologies that help ensure a strong,
committed, and well-trained work force. Currently, certain categories
of Medicaid covered services, for which Medicaid is a primary payer,
such as personal care services, suffer from especially high rates of
turnover and low levels of participation. We believe the proposed
provider payment reassignment provision retained in the final rule will
provide to states additional tools to help foster a stable and high
performing workforce.
Comment: One commenter stated that authorizing payments on behalf
of an individual practitioner to a third party for health and welfare
benefit costs, training costs, or other benefits customary for
employees aligns with essential elements that they advocate for quality
direct-care jobs. They stated their belief that this will support state
efforts to expand and improve consumer employment and direction of in-
home personal care workers. They further stated that workers need
affordable health insurance, other family-supportive benefits, and
excellent training that helps each worker develop and hone all skills--
both technical and relational--necessary to support long-term care
consumers in order to ensure that all direct-care workers are able to
provide the highest-quality care to all long-term care consumers. They
believe that for consumer-directed home care workers, it is even more
vital that states assume some of the human resources functions of
typical employers.
Response: We appreciate the commenter's support for the proposed
provision and agree with its potential to improve both the stability
and the skills of the health care provider workforce.
[[Page 3002]]
The payment arrangements that we are permitting will enhance state
options to provide practitioners with benefits that improve their
ability to function as health care professionals. For the classes of
practitioners for whom the state is the only or primary payer, these
payment arrangements are an efficient and effective method for ensuring
that the workforce has health and welfare benefits and adequate
training for their functioning.
Comment: One commenter stated that it will be essential for CMS,
states, advocates, program participants, and organizations to
understand how this proposed rule is appropriately applied within a
participant direction model. The proposed provision, they suggested,
should by no means be interpreted to allow for restrictions on
participants' decisions pertaining to what s/he feels is critical to
the managing of workers. In their own training, program participants
should be informed of the benefits for which workers are eligible to
ensure informed decisions are made. They urged that any additional
deductions should be paid for with increased funding for the program
rather than be paid directly from individuals' budgets already
allocated to needed services and supports.
Response: Direct payment of funds by states to third parties on
behalf of practitioners, to ensure benefits that support those
practitioners and provide skills training, may help ensure that
beneficiaries have greater access to such practitioners and higher
quality services. In addition, if a state elects to withhold certain
payments from practitioners, as the proposed provision would allow, and
forwards those amounts to a third party on behalf of that practitioner
for health and welfare contributions, training programs, or in support
of other employee benefits, there will not necessarily be any impact on
program budgets. This rule will not require any change in state funding
to the extent that practitioner rates already factored in the costs of
benefits and skills training. This rule will simply provide flexibility
for states to fund such costs directly and ensure uniform access to
benefits and skills training for practitioners. Indeed, there may be
cost savings resulting from the collective purchase of such benefits
and greater workforce stability.
Comment: One commenter supports CMS' objective of clarifying the
prohibition on reassignment in section 1902(a)(32) of the Act to ensure
that it is limited to its intended application and that it does not
have any unintended adverse impact on important state Medicaid
operations. They suggested that states have long sought this
clarification primarily in the context of state efforts to expand and
improve programs that maximize consumer choice and independence and
allow individuals to receive long term care services and supports in
their homes and communities. They stated that the health care providers
who assist these individuals are considered independent service
practitioners both due to their relationship to the state and the
consumer, and as a result face barriers including a lack of access to
benefits and training. It makes sense, therefore, for states to be able
to make ``employer-like payments from the Medicaid service fee to
fulfill employer-like functions'' that overcome these employment
barriers.
Response: CMS appreciates the commenter's support for the proposed
provision and agrees that for the classes of practitioners for whom the
state is the sole or primary payer, and has many attributes of an
employer, the state should be afforded flexibilities to help ensure a
stable, high performing workforce.
Comment: One commenter indicated that as a future nurse
practitioner, she believes the application of this proposed provision
is timely and she believes it will support state efforts to claim
``excess provider payments that are not directly going to the provider
but could be used to advance statewide practice from a global
perspective.''
Response: We appreciate the commenter's support for the proposed
provision. However, we would note that the proposed provider payment
reassignment provision does not involve ``excess provider payments''.
Rather, as in the proposed rule, the final rule will offer states
flexibility in determining appropriate costs to consider in their
development of payment rate methodologies to ensure adequate training,
health and welfare benefits, and other benefits customary for employees
within the development of that rate. States will be permitted to
directly pay third parties for health and welfare benefits, training,
and other employee benefit costs. These amounts would not be retained
by the state, but would be paid on behalf of the practitioner for the
stated purpose. In fact, we believe that direct payment of funds to
third parties on behalf of the practitioner may be viewed as
advantageous by the practitioner insofar as they have increased
opportunities for training. In addition, direct payment of funds to
third parties on behalf of the practitioners may ensure that
beneficiaries have greater access to such practitioners and higher
quality services.
Comment: One commenter noted that, using the proposed provision,
Medicaid can leverage its dominant role and help stabilize the direct
care workforce. Specifically, the commenter noted that by encouraging
Medicaid to directly pay practitioners for health and welfare benefit
costs, training, or other benefits customary for employees, job quality
will improve leading to improving recruitment and retention of skilled
direct-care workers and better quality care. The commenter also
recommended that CMS provide states with the appropriate technical
assistance in order to assist them in adequately conducting needs
assessments of their own direct-care workforce.
Response: We agree that states that voluntarily elect to utilize
the proposed provider payment reassignment provision may help improve
their own health care provider workforce. We also agree with the need
for states to receive adequate technical assistance from us in order to
implement the provision. States with questions regarding the provision
are encouraged to contact their Regional Office for further guidance.
Comment: One state asked if the third parties to whom withheld
funds are provided would be subject to the provisions of part 455,
subpart E, Provider Screening and Enrollment.
Response: No. If the state elects to reassign provider payments for
health and welfare costs, training expenses, or other employee
benefits, the third party to whom those payments are assigned would be
the recipient of such funds, but not the provider of record and hence
not subject to provider qualification requirements. The amounts paid to
a third party would be on behalf of the individual practitioner.
Comment: One commenter seeks clarification as to what would
constitute a health and welfare benefit contribution. Specifically, one
state would like to know if this would include amounts for paid time
off for personal care attendants.
Response: The proposed change, retained in the final rule, permits
each state the option to elect such payment arrangements to the extent
that the state determines that they are related to benefits such as
health care, skills training and other benefits customary for
employees. States will need to review their individual circumstances
and workforce needs to determine if the measures are related to such
benefits, and would help serve program objectives such as to ensure a
stable, high performing workforce. We do not wish to prescribe the
types of benefits
[[Page 3003]]
the state might wish to include in its definition of health and welfare
benefits, such as paid time off for personal care attendants. As in the
proposed rule, the final rule offers states flexibility in determining
appropriate aspects to consider in their development of payment rate
methodologies to ensure adequate training, health care, and other
employee benefits for practitioners, as defined by the state.
Comment: One commenter requested a modification to the proposed
regulatory text for the provider payment reassignment provision to
avoid a possible misunderstanding as to its coverage. Specifically, the
commenter recommended a change to clarify that it is applicable to
providers for whom the main source of service revenue is the Medicaid
program. As proposed, the language states that the provider payment
reassignment exception is ``[in] the case of practitioners for which
the Medicaid program is the primary source of revenue . . .'' Without
such clarifying language, the commenter recommends, a state may not be
able to make deductions for health care, training, and other benefits
that it provides for individuals who operate adult foster care homes in
their residences. Since the consumer pays the provider for room and
board in that instance, the provider's primary source of revenue may
not be considered to be the Medicaid program.
Response: We have clarified the language in the final rule by
specifying that the state must be the primary source of service revenue
for the practitioner. The proposed regulatory text would permit states
to make payment to third parties for provider benefits when the state
is operating in the role of the provider's employer (even if the state
is not the employer for other purposes). As clarified, the text will
provide flexibility for a state to look at revenue only related to
services furnished by the practitioner, rather than revenue related to
shelter and food costs. We believe the proposed regulatory text, which
we are retaining, provides the necessary latitude for states to
determine whether it is acting in the role of an employer for a
particular class of practitioners.
III. Home and Community-Based Services (HCBS) Waivers (Section 1915(c)
of the Act)
A. Background
Section 1915(c) of the Social Security Act (the Act) authorizes the
Secretary of Health and Human Services to waive certain Medicaid
statutory requirements so that a state may offer Home and Community-
Based Services (HCBS) to state-specified group(s) of Medicaid
beneficiaries who otherwise would require services at an institutional
level of care. This provision was added to the Act by the Omnibus
Budget and Reconciliation Act of 1981 (Pub. L. 97-35, enacted August
13, 1981) (OBRA'81) (with a number of subsequent amendments).
Regulations were published to effectuate this statutory provision, with
final regulations issued on July 25, 1994 (59 FR 37719). In the June
22, 2009 Federal Register (74 FR 29453), we published the Medicaid
Program; Home and Community-Based Services (HCBS) advance notice of
proposed rulemaking (ANPRM) that proposed to initiate rulemaking on a
number of areas within the section 1915(c) of the Act program. In the
proposed rule published on April 15, 2011 (76 FR 21311-21317), we
discussed the comments relating to questions posed by the ANPRM, which
are addressed in this final rule. We included proposed language for
settings in which HCBS could be provided to elicit further comments on
this issue in the section 1915(c) of the Act proposed rule, in the
section 1915(k) of the Act proposed rule published on February 25, 2011
and also in the section 1915(i) of the Act proposed rule published on
May 3, 2012 as we recognize the need for a consistent definition of
home and community-based settings. It is our goal to align the final
rule language pertaining to home and community-based setting across the
sections 1915(c), 1915(i) and 1915(k) of the Act Medicaid HCBS
authorities. We further sought to use this opportunity to clarify
requirements regarding timing of amendments and public input
requirements when states propose modifications to HCBS waiver programs
and service rates, and strategies available to CMS to ensure state
compliance with the requirements of section 1915(c) of the Act.
We have earlier explained our purpose for proposing definitions
regarding home and community-based settings (see discussion under
section II.A. of this rule).
We believe that these final changes will have numerous benefits for
individuals and states alike. In addition to addressing individual and
stakeholder input, these changes will improve HCBS waiver programs and
support beneficiaries by enabling services to be planned and delivered
in a manner driven by individual needs rather than diagnosis. These
changes will enable states to realize administrative and program design
simplification, as well as improve efficiency of operation. The changes
related to clarification of HCBS settings will maximize the
opportunities for waiver participants to have access to the benefits of
community living and to receive services in the most integrated
setting, and will effectuate the law's intention for Medicaid home and
community-based services to provide alternatives to services provided
in institutions.
B. Provisions of the Proposed Regulations and Analysis of and Responses
to Public Comments
On April 15, 2011, we published a proposed rule (76 FR 21311)
entitled, ``Medicaid Program: Home and Community-Based Services (HCBS)
Waivers'' which proposed revising the regulations implementing Medicaid
home and community-based services under section 1915(c) of the Act in
several key policy areas. First, the proposed rule provides states the
option to combine the existing three waiver targeting groups as
identified in Sec. 441.301. In addition, we proposed changes to the
HCBS waiver provisions to convey requirements regarding person-centered
service plans, characteristics of settings that are, as well as are
not, home and community-based, to clarify the timing of amendments and
public input requirements when states propose modifications to HCBS
waiver programs and service rates, and to describe the additional
strategies available to us to ensure state compliance with the
statutory provisions of section 1915(c) of the Act.
We received a total of 1653 comments from State Medicaid agencies,
advocacy groups, health care providers, employers, health insurers, and
health care associations. The comments ranged from general support or
opposition to the proposed provisions to very specific questions or
comments regarding the proposed changes.
Brief summaries of each proposed provision, a summary of the public
comments we received (with the exception of specific comments on the
paperwork burden or the economic impact analysis), and our responses to
the comments are as follows.
The following summarizes a few general comments received regarding
the notice of proposed rulemaking and also comments regarding issues
not contained in specific provisions. We appreciate and thank the
commenters for these various remarks. We realize these commenters raise
important considerations in support of persons receiving Medicaid HCBS
living in community settings, in integrated
[[Page 3004]]
settings, and working in jobs with meaningful wages. Since these
important comments did not address any specific regulatory provisions
in the proposed rule, there is no need to respond to them further in
the final rule:
Comment: We received many comments supporting the proposed policies
in the proposed rule, as well as some comments expressing concerns
about the various aspects of the rule.
Response: We appreciate the feedback received on the proposed rule
and have relied heavily on the insights provided by states, advocacy
groups, consumers and health care providers. We appreciate the
acknowledgement and support of the policies.
Comment: We received several comments expressing concern about
stakeholder input with respect to these rules.
Response: We recognized the need for a diversity of stakeholder
input. Thus, in the June 22, 2009 Federal Register (74 FR 29453), we
released an advance notice of proposed rulemaking that proposed to
initiate rulemaking on a number of areas within the section 1915(c) of
the Act program and to solicit diverse comment. Additionally, after we
published the proposed rule on April 15, 2011 (76 FR 21311), we
continued to meet with stakeholders that included advocacy groups,
states, other federal agencies, provider groups and assisted living
groups as we developed this rule.
We plan to continue to communicate with states and build upon state
experience as we work with states to implement new policies and program
changes as a means of ensuring a successful partnership between states
and federal government. In addition, we will provide technical
assistance and support to states. We encourage states to share across
states as implementation continues. The public comments we receive will
inform the development of future operational guidance and tools that
will be designed to support state implementation efforts.
1. Contents of Request for a Waiver (Sec. 441.301)
a. Person-Centered Planning Process Sec. 441.301(c)(1) (Proposed Sec.
441301(b)(1)(i)(A))
The provisions of this final rule will apply to all states offering
Medicaid HCBS waivers under section 1915(c) of the Act. Comments were
supportive of our interest in setting forth requirements regarding
person-centered service and support plans that reflect what is
important to the individual. The final revisions to Sec. 441.301(c)(1)
(proposed Sec. 441.301(b)(1)(i)(A)) will require that a written
services and support plan be based on the person-centered approach.
This provision includes minimum requirements for this approach.
At Sec. 441.301(b)(1)(i)(A) we proposed that a state request for a
waiver must include explanation of how the state will use a person-
centered process to develop a written services and support plan,
subject to approval by the Medicaid agency. We received 286 comments
about person-centered planning, most indicating how important it is to
individuals that HCBS are provided in a manner that supports their
values and preferences, rather than to satisfy an impersonal or
provider-centered plan of care. In the comments immediately below we
outline the suggestions that do not directly affect the regulatory
language, and indicate in some cases where we will consider these ideas
in developing future guidance. Comments that pertain to the proposed
regulation language will be considered in more detail, under the
corresponding section of proposed text.
Comment: Many of the comments had to do with effective methods for
conducting an individual person-centered planning meeting. While some
commenters seemed to favor requiring certain features, a variety of
commenters made the opposite general point, cautioning that too many or
overly specific requirements would cause the process to become
bureaucratic instead of personal. Comments that specific proposed
provisions are too prescriptive are noted in those sections below. A
few commenters agreed with the concept, but not the language of the
proposed person-centered planning rule. They suggested replacing the
entire person-centered planning section with the language
``contemporary, promising practices that result in consumers having
control over the services, resources, and planning of their lives.''
Finally a few commenters believe that the proposed changes implement a
``one size fits all'' ideology.
Response: States administer Medicaid and have flexibility in how
federal Medicaid requirements are implemented. Therefore, the language
we are including in the final rule expresses what must occur rather
than how. The federal regulations set the requirements and minimum
standards for an activity. We may issue, as needed, additional guidance
to states to assist in the interpretation and implementation of the
rule.
Comment: Some commenters requested general clarification of terms
and illustration by example. Specifically, commenters presented
questions around how person-centered planning is to be implemented and
whether any substantive rights are established for the individual.
Response: Examples and other explanations are generally included in
the preamble to a notice of proposed or final rulemaking rather than in
the regulation text. The commenter is correct that beyond the
requirements in subparagraph (A) we do not specify how the planning
process is to be implemented, for the reasons given immediately above.
The commenter did not specify the particular rights of concern, so we
cannot respond specifically to that issue. We consider the requirements
outlined here to confer to individuals the right to a person-centered
service plan, and a planning process, that meets these requirements.
Individuals also have other rights under different authorities, which
do not rely on this regulation. For example, civil rights against
various forms of discrimination are protected under the ADA and
elsewhere. CMS regularly works with the HHS Office for Civil Rights,
Department of Justice (DOJ), and others to assure that we address civil
rights issues as they bear on Medicaid requirements.
Comment: Many and varied commenters suggested that CMS make person-
centered planning requirements consistent across all the authorities in
which HCBS may be offered, such as the new Community First Choice
program and the State Plan HCBS benefit. Specific language from
proposed rules for those authorities was recommended.
Response: We agree that person-centered planning, as well as other
HCBS requirements, should be consistent across authorities. In response
to comments, proposed rules for some HCBS authorities have been
published in the last several years, reflecting development in the
concept of person-centered planning. We are working to bring all rules
into harmony. We do point out that rules reflect the nature of the
service--for example, planning for Community First Choice involves the
plan for that particular service, and may not involve some of the
program elements of a section 1915(c) of the Act HCBS waiver. We will
endeavor to make the requirements parallel across authorities; however,
they may not be identical due to some statutory differences.
Comment: A variety of commenters requested that the planning
process consider the needs of individuals more than satisfying
regulations or ``paper-completion.'' Many asked that the regulation
focus on outcomes, not process.
[[Page 3005]]
Response: We agree that the planning process should not be about
filling out forms. The final rule requires actions and outcomes that
result in a very active process and an individualized plan that is not
focused on paper completion. We also note that the degree to which the
process achieves the goal of person-centeredness can only be known with
appropriate quality monitoring by the state, which should include
substantial feedback provided by individuals who received or are
receiving services.
Comment: A commenter believes that these requirements will be very
expensive for states to implement because of added staff and IT system
costs. The requirements should take into account states' current budget
problems.
Response: States are currently required to develop a plan of care
sufficient to meet HCBS waiver participants' assessed needs for health
and welfare. We do not believe the provisions in these regulations will
significantly increase burden and note that investment in effective
information technology, with federal financial participation, will
increase efficiency.
In Sec. 441.301(b)(1)(i)(A)(1) through (7), we proposed
requirements for the Person-Centered Planning Process. Following are
general comments we received on these requirements.
Comment: Several commenters objected to the term ``plan of care,''
which they believe dismisses active person controlled service planning,
and would prefer something about outcomes.
Response: The regulatory text reads, ``. . . . a written person-
centered service plan (also called plan of care) that is based on a
person-centered approach. . . .'' The term plan of care is widely used,
and reflected in waiver application documents. We indicated
parenthetically that we are not referring to another separate process,
but to that function we have until now called plan of care. While we do
not agree that either term necessarily implies lack of individual
control, we agree that ``person-centered service plan'' is superior
because it is less medical in connotation and conveys that it is a plan
for long term services and supports and it is developed with a person-
centered process. We will change the term ``plan of care'' to ``person-
centered service plan.'' Also, as noted in more specific comments
below, many commenters wanted stronger language about the individual
leading the process. We believe the phrase ``led by the individual''
clearly indicates that the individual is leading the process; however,
we have further revised the language to read ``led by the individual
receiving services and supports'' instead of ``led by the individual
receiving services.'' Throughout the rest of the section, we will
change any references to ``services'' or ``supports'' to ``services and
supports.''
Comment: Some commenters objected to mandating person-centered
planning on two grounds: some individuals may not want it, and some
individuals may not be able to do it. They believe that CMS was
assuming both interest and ability would be present in all HCBS
participants. Some commenters listed specific disabilities they believe
limit cognitive or expressive ability to such an extent that the
individual could not lead the process.
Response: With regard to the issue of choice, the regulation
language does not require individuals to be more involved than they
choose to be in their own planning processes. Individuals may decline
to participate in the process if they so choose. Regarding the issue of
ability, we noted that commensurate with the level of need of the
individual, the person-centered service plan must reflect the service
and support needs as identified through a person-centered functional
assessment. Individuals may select another person(s) to assist or
represent them in the process. In addition, where state law confers
decision-making authority to a legal representative, such as a
guardian, that individual may direct the person-centered planning
process on behalf of the individual.
Following are the comments we received on Sec.
441.301(b)(1)(i)(A)(1) of the proposed rule, which is Sec.
441.301(c)(1)(i) of the final rule.
Comment: Quite a few commenters urged that the individual be
allowed to choose who attends the meeting. Many stated that a person-
centered service plan should provide freedom from unwanted intrusion in
preferences and choices which could be from family, providers and
professionals, or others. In other words, the individuals should have
``veto power.''
Response: We believe the language in the final rule clearly
indicates that individuals are allowed to choose who does or does not
attend the meeting; we are therefore retaining the proposed language.
Comment: Most of the comments about assuring that certain persons
could be present concerned the role of guardians and legal
representatives or chosen surrogates. Some wanted these terms defined
and roles specified, especially ``legal'' representative and attorneys.
Others wanted to be sure that the rule allows for representatives who
are not a legally designated representative, but might be a family
member, friend, advocate, or other trusted person chosen by the
individual. Another asked for a statement that a public guardian may
not act as the designated representative due to the inherent
unavoidable conflict of interest. Several commenters believed that the
participation of various surrogates would result in them, not the
individual, leading the planning process. A few also asserted that
parental and guardian authority prevents abuses by professionals in the
person-centered planning (PCP) process. A few commenters believed that
the proposed rule reduces the authority of a parent or guardian in the
PCP process, as the Medicaid manual previously entitled them. Several
other very specific suggestions were made for requirements applicable
to representatives.
Response: Our omission of explicit mention of representatives and
other surrogates was not intentional and did not signal any intention
to exclude them from among those whom individuals may choose to include
in planning. Any references in this rule to ``individuals'' include the
role of the individual's representative. We are aware of the essential
role that representatives, guardians, and family members play in the
lives of some individuals with receiving Medicaid HCBS. We are also
aware of the published literature on the problem and conflicts of
interest that occur, particularly with publicly appointed guardians in
some jurisdictions. We proposed in Sec. 441.301(b)(1)(i)(A)(5) a
process for identifying and resolving conflicts of interest. We do not
agree with those who expressed the belief that guardians would lead the
planning process, instead of the individual. Though we recognize that
some individuals without receptive or expressive communication depend
on others to determine and articulate their needs, we will continue to
speak of the individual as being in the center. Therefore, we have
revised the rule to clarify the expectation that the individual will
lead the planning process where possible and that the legal
representative should have a participatory role, as needed and as
defined by the individual, unless state law confers decision-making
authority to the legal representative. We note that the term
``individual's representative'' is also defined under 1915(i) State
plan HCBS regulations at Sec. 441.735 of this rule, and further note
that this rule does not abridge the legal authority of a parent or
legal guardian.
Comment: Two commenters stated that CMS appears to attempt to
regulate
[[Page 3006]]
unpaid family members and friendly volunteers by including them in the
rule. Another concern is that including lay persons could violate
confidentiality protections for the individual.
Response: We do not agree that the rule inadvertently regulates
unpaid participants in the planning process in a general or undesirable
manner. Rather, we intend that individuals have a meaningful choice of
who can assist them in the planning process. We also see no reason to
believe that states will relax their responsibility to protect client
confidentiality in this process. The individual chooses who
participates in the planning process, and thus retains direct control
over who has access to private information.
Following are the comments we received on Sec.
441.301(b)(1)(i)(A)(2), which is now Sec. 441.301(c)(1)(ii) of the
final rule.
Comment: Commenters pointed out that the proposed language is
ambiguous. Several commenters recognized the intent of the proposed
regulation to strengthen the person-centered service plan development
process, but were concerned that the language undermines the progress
made to empower people with disabilities in their planning process.
Commenters expressed concern that playing a ``meaningful role'' is not
the same thing as authority for decision making. Several comments
indicated a belief that at least some HCBS participants cannot lead or
even contribute to the service plan; several specifically mentioned
people with intellectual disabilities or dementia. A few suggested
specific supports, such as decision making tools and communications
support.
Response: We do not intend a shift from the individual directing
the process. We agree that the language should be clarified.
``Meaningful'' is a subjective standard. We will clarify that the
person-centered planning process provides necessary information and
support to ensure that the individual directs the process to the
maximum extent possible, and is enabled to make informed choices and
decisions. We believe the language ``to the maximum extent possible''
reflects the level at which the individual desires or is able to
participate. We believe that with skillful facilitation, individuals
can express themselves to their fullest extent.
Many commenters urged us to favor empowering the individual; others
urged empowering those who believe they have the best insight into the
individual's needs and wishes. The regulation does not put these
interests in competition. This final rule requires a process that puts
the individual in the center, driving the process to the extent
feasible, and recognizes the other persons' insights into the
individual's strengths, needs, and preferences. The supports help to
identify and sort out differing views among those present. At Sec.
441.301(c)(1)(v) we discuss further the role of the facilitation
process in managing disagreements and the inherent differences in self-
interest present in any diverse team.
We agree that some of the specific types of support commenters
suggested will be valuable for some individuals, but we do not
prescribe in regulation all the specific supports that can be offered.
These vary according to many factors including the type of disability.
We have revised this final rule to read: ``Provides necessary
information and support to ensure that the individual directs the
process to the maximum extent possible, and is enabled to make informed
choices and decisions.''
Comment: We received a few comments expressing opposite views on
professionals participating in the planning. Two commenters did not
believe that a planning process can include professionals and be
person-centered because the individual will not direct the process.
Others requested adding a provision to assure that the planning process
is facilitated by a professional trained and skilled in person-centered
planning techniques, possibly an independent facilitator.
Response: Person-centered service planning is a complex concept and
requires both commitment and skill to implement. We agree that if
professionals take control from individuals in the planning process,
the requirements of this rule will not have been met. We do not agree
that it is impossible for professionals to participate in the process
appropriately. Indeed, as in many professional disciplines, the values,
ethics, and the evolution of best practices in the profession offer the
best means of consistently implementing a process that supports and
serves the individual. We require that supports be available to assist
all individuals in leading the planning process, and sometimes those
supports include professionals skilled in facilitation. We believe the
revised language is sufficiently clear in that it states an outcome--
the individual directs the process, with supports if needed.
Following are the comments we received on Sec.
441.301(b)(1)(i)(A)(3), which is now Sec. 441.301(c)(1)(iii) of the
final rule.
Comment: We received relatively few comments in response to this
provision. Some commenters stated that the time and location preference
only belonged to the individual, or that it should occur only in the
individual's home, while others pointed out that the logistics should
be negotiated with all participants. Some wanted more specificity,
including whether the process must always be face to face; others
believe the rule to be too prescriptive. We also address here a comment
that the rule lacks any requirement for timeliness.
Response: As proposed, the regulation text aims to address a
problem significant numbers of waiver participants may have
experienced: that the planning process is scheduled entirely at the
convenience of the state and/or provider agency. This language is
silent about the convenience or preference of other participants, and
we do not agree that silence precludes taking these and other factors
into account. We agree that timeliness is important. When individuals
rely heavily on services and supports, waiting to update a plan in
response to a changed need could be a significant hardship or even a
danger. Because the need for planning can range from urgent to
optional, we do not believe it is appropriate or helpful to specify
time frames in regulation. However, we are revising this provision in
the final rule atSec. 441.301(c)(1)(iii) as follows: ``Is timely and
occurs at times and locations of convenience to the individual.''
Following are the comments we received on Sec.
441.301(b)(1)(i)(A)(4), which is now Sec. 441.301(c)(1)(iv) of the
final rule.
Comment: Several commenters suggested that the regulation be more
specific and more clearly articulate and strengthen ``cultural
considerations,'' include more detailed state responsibilities, and
offer translation services in the individual's first language. No
comments objected to this provision specifically.
Response: We have added text to specify that a State's waiver
request include how the person centered planning process is accessible
to persons who are LEP and persons with disabilities, consistent with
the Medicaid programmatic accessibility provision at Sec. 435.905(b).
Following are the comments we received on Sec.
441.301(b)(1)(i)(A)(5), which is now Sec. 441.301(c)(1)(v) of the
final rule.
Comment: Several commenters asked that we clarify this statement,
including how to implement it and the types of conflict anticipated.
Many comments
[[Page 3007]]
suggested types of disagreement or conflicts of interest to address,
including interpersonal disagreement, denial or reduction in service,
failure to implement the plan or comply with regulations, and whether
providers have an inherent conflict and should not be present.
Response: We do not think that additional clarification is
appropriate in the regulation. Furthermore, states can exercise
multiple strategies to comply with this requirement.
We note that some commenters confused a provider being in
attendance with a provider being in charge of the process or the plan.
The latter (a provider being in charge of the process or plan) is not
appropriate; the former (the provider being in attendance) depends on
the circumstance and is not a matter subject to blanket requirements.
Individuals may choose, or not, to include a provider of service in the
planning team. In some situations a direct care worker or a therapist
has worked so long and closely with the individual that his or her
perspective is very important. Also, some providers point out that they
should be able to voice any limits in what they can provide, so that a
plan for someone with intense need does not commit providers to
services they are not able to provide. In other situations, for
example, if the individual is anxious about repercussions from voicing
problems, or has a tendency to defer to a provider, that provider's
presence would be detrimental. Clearly some actions, such as
intimidating the individual, are unacceptable.
We do not believe it is possible to define more specific conflict
of interest requirements that would be meaningful in the variety of
arrangements currently used to develop person-centered service and
support plans. We have strengthened the language by requiring that the
state devise clear conflict of interest guidelines addressed to all
parties who participate in the planning process.
Comment: Several commenters asked to strengthen the provision by
requiring case managers to be independent of any service provider, as
an assurance that the individual's goals and services will be
appropriate, and will reduce actual or potential conflicts of interest.
Others indicated that we do not define conflict of interest.
Response: We agree that complete independence of the person(s)
facilitating the planning process is important to promote the statutory
objectives. In the final rule, we have added an additional requirement
to the person-centered planning process at Sec. 441.301(c)(1)(vi) to
address conflict of interest.
Following are the comments we received on Sec.
441.301(b)(1)(i)(A)(6), which is now Sec. 441.301(c)(1)(vii) of the
final rule.
Comment: One commenter stated that current overarching Medicaid
regulations already require full freedom of choice of qualified
providers and CMS requires that states document that individuals have
been offered freedom of choice. This is duplicative.
Response: The regulations at Sec. 431.51 describe the various
statutory bases for the free choice of provider, and specify the
requirements and exceptions to the principle. The phrase ``full freedom
of choice,'' however, is not from existing regulation. We assume the
commenter's reference to a documentation requirement pertains to the
section 1915(c) of the Act requirement that waiver participants be
offered the choice of institutional alternatives to HCBS options in the
waiver, which is unrelated to being informed of non-institutional
service alternatives. Some persons with disabilities and their
advocates have described the experience of ``choice'' in long term
services and supports as being considerably different than that of a
Medicaid beneficiary looking through a list of participating acute or
general health care providers. We believe that a person-centered
planning process should include providing the individual information
about the services and supports relevant to their particular needs and
goals.
Comment: Individuals receiving long term services and supports and
their families discussed the experience of both being presented with
options and not being given choices. Comments noted that individuals
wish to be respected and offered choices, rather than others deciding
what may be best for them. On the other hand, being presented with an
exhaustive list of theoretical options and a directory of providers is
overwhelming and not very useful, a familiar experience to many people
negotiating a new health care need. One comment stated, ``Ensure the
person has the support he or she needs to understand all of the choices
and options, their rights, and what they are agreeing to.'' Some
commenters suggested adding the word ``informed'' before ``choices,''
as this would be more consistent with the ADA.
Response: We agree that it is difficult to articulate a rule that
ensures a perfect balance between too much and too little information.
We believe that taken as a whole, the requirements in this final rule
make clear that the process of planning services and supports puts the
person at the center of a highly individualized process. We agree with
the suggestion to change ``Offers choices'' to ``Offers informed
choices.'' Individuals should be informed of all the possibilities from
which they may choose, as well as the consequences of those choices, in
a manner that is meaningful to the recipient and easily understood.
Comment: Several suggestions were made regarding specific issues or
special circumstances regarding individual choice, including
documentation of court orders or other legal issues, identification of
rights, and linkage to entitlements or resources other than Medicaid.
Response: These suggestions appear to be good practices, but too
detailed for regulation. We will consider them in the context of our
ongoing efforts to provide information about best practices.
Following are the comments we received on Sec.
441.301(b)(1)(i)(A)(7), which is now Sec. 441.301(c)(1)(viii) of the
final rule.
Comment: Two commenters pointed out that ``as needed'' may or may
not include periodic scheduled updates, and does not address the
timeframe within which a requested update be accomplished. They
suggested changing the language to: ``Include opportunities for
periodic and ongoing plan updates as needed and/or requested by the
individual and a time frame for reasonably scheduling meetings
requested by the individual.'' One suggestion was to define timeliness
in terms of the individual's goals. Another asked to make explicit that
all individuals participating in the planning process be contacted so
that they can be kept up to date.
Response: This section proposed a process requirement, having to do
with informing the individual about what steps to take to schedule an
update to the plan. We do not address timeliness regarding the response
to request, as we are not able to set a single national standard that
would be applicable across all HCBS waivers in the country. States must
respond to urgent needs more quickly than to other types of requests,
in order to meet the health and welfare requirements of the HCBS waiver
program. States could accomplish this through an expedited process.
Requiring that plan participants be notified when an update is
scheduled has merit. However, given the requirements concerning who
participates in the plan, who should sign the plan, and who should have
copies of the plan, we cannot construct a notification policy that
respects the various levels of confidentiality and
[[Page 3008]]
disclosure that may be required in some cases. At this time we believe
that the individual or individual and representative should control
notification about updates, consistent with the control they have under
item (1) over who participates in the planning process.
b. Person-Centered Service Plan Sec. 441.301(c)(2) (Proposed Sec.
441.301(b)(1)(i)(B))
At Sec. 441.301(b)(1)(i)(B) we proposed that the Person-Centered
Service Plan must include specific content. After further review, we
believe the requirement at Sec. 441.301(b)(1)(i)(A)(3) regarding
timeliness and this requirement at Sec. 441.301(b)(1)(i)(A)(7)
regarding a method for individuals to request updates to the plan are
sufficient and respectful of the individual's timeframe as reflected in
the person-centered planning process. Therefore, we are removing the
requirement at Sec. 441.301(b)(1)(i)(A)(3) regarding a timeline for
review because this will now be addressed through the requirements at
Sec. 441.301(c)(1)(iii) and (c)(1)(viii)).
Following are the comments we received on Sec.
441.301(b)(1)(i)(B)(2), which is now Sec. 441.301(c)(2)(iii) of the
final rule.
Comment: A commenter stated that a ``person-centered functional
assessment'' is superior to a disability or diagnosis-based assessment.
Another pointed out that ``person-centered functional assessment'' is
not recognized terminology and suggested ``individual assessment
appropriate to the age and circumstances of the person'' instead.
Response: We agree with parts of both comments. Applying ``person-
centered'' to ``functional assessment'' is incorrect. Although in a
general sense all long term service and support activities are to be
centered on the person and not the provider, a functional assessment is
objective. We also agree with the comment that ``functional''
assessment imparts an important distinction from other forms of
evaluation such as diagnostic assessment. We therefore modify the
proposed language to ``through an assessment of functional need.''
Following are the comments we received on Sec.
441.301(b)(1)(i)(B)(3), which is now Sec. 441.301(c)(2)(iv) of the
final rule.
Comment: A commenter pointed out that there is no specific mention
of mental health. Many comments in various sections mentioned that the
rule should focus on outcomes.
Response: We agree with both observations. We recognize that we
cannot provide an exhaustive list to reflect an individual's identified
goals. Therefore, we are removing the examples and we are revising the
final rule at Sec. 441.301(c)(2)(iv) by adding ``desired outcomes.''
Comment: Related to the proposal to define home and community-based
settings, we received many suggestions that the person-centered plan
address the issue of housing and living arrangement in a definite
manner. The proposed list of example goals included ``community
living'' but this was not believed to sufficiently capture the
complexity of housing and services issues.
Response: We appreciate the thoughtful comments and agree that this
important subject warrants a separate item in the list of the plan
content. We will add a new requirement at Sec. 441.301(c)(2)(i) to
read: ``Reflect that the setting in which the individual resides is
chosen by the individual The state must ensure that the setting chosen
by the individual is integrated in, supports full access of individuals
receiving Medicaid HCBS to the greater community, including
opportunities to seek employment and work in competitive integrated
settings, engage in community life, control personal resources and
receive services in the community to the same degree of access as
individuals not receiving Medicaid HCBS.''
Following are the comments we received on Sec.
441.301(b)(1)(i)(B)(4) which is now Sec. 441.301(c)(2)(v) of the final
rule.
Comment: We received few comments on this requirement. One
commenter suggested replacing this language with ``Respect and honor
the choices made by the individual regarding supports.'' Another
suggested adding the ``full range'' of services and supports. Others
commented on or requested clarification about unpaid services, or urged
us to clarify that unpaid services must not be required.
Response: We believe that natural supports and other unpaid
services must be included in order to have a comprehensive plan
reflecting all the services and supports required. The availability of
unpaid supports may change from time to time and the plan must be
written so as to be able to adjust the proportion of formal and
informal supports without starting over at assessment. The planning
process must not compel unpaid services. We have included the term
``natural supports'' in the regulation text at Sec. 441.301(c)(2)(v)
and have added the following sentence: ``Natural supports are unpaid
supports that are provided voluntarily to the individual in lieu of
section 1915(c) HCBS waiver services and supports.'' We do not believe
other wording suggestions are required to achieve the intended meaning.
Following are the comments we received on Sec.
441.301(b)(1)(i)(B)(5), which is now Sec. 441.301(c)(2)(vi) of the
final rule.
Comment: Comments supported the proposed language. We choose to
address here similar comments on several sections of the proposed rule.
Some commenters were concerned that in taking care to protect freedoms,
the regulation did not provide for reducing risk due to certain kinds
of disabilities. Dementia was mentioned most often, with many examples
of why some believe individual freedoms may need to be curtailed to
prevent wandering, injury with cooking equipment and so on.
Response: Based on the comments received, we conclude that
additional language is needed to ensure that reducing risk for
individuals receiving Medicaid HCBS does not involve abridgement of
their independence, freedom, and choice either generally or at the
spontaneous decision of persons providing services and supports.
Restricting independence or access to resources is appropriate only to
reduce specific risks, and only when considered carefully in the
person-centered service plan. The person-centered planning process
required in this regulation will engage the individual and others
involved in the planning process as fully as possible in making these
difficult but necessary decisions. As comments indicated, there may be
a need for immediate action in emergent or changing circumstances--that
is the purpose of backup strategies. In thinking through risk, the
planning team will identify temporary measures to be used if needed,
and then update the plan when needs have stabilized. Back-up strategies
are to be individualized to the unique mix of risks, strengths, and
supports represented by each waiver participant. We will articulate
this in the final rule by amending the language at Sec.
441.301(c)(2)(vi) to read: ``Reflect risk factors and measures in place
to minimize them, including individualized backup plans and strategies
when needed.'' We have also added at Sec. 441.301(c)(2)(xiii) that any
modification of the additional conditions must be supported by a
specific assessed need and justified in the person-centered service
plan, and specified what must be documented in
[[Page 3009]]
the person-centered service plan in these instances.
Following are the comments we received on Sec.
441.301(b)(1)(i)(B)(6), which is now Sec. 441.301(c)(2)(ix) of the
final rule.
Comment: Many comments on this requirement addressed the variety of
persons who may be involved in formulating the plan and in carrying it
out, any of whom may have complex relationships with the individual and
each other. Some comments were primarily concerned with being
inclusive, and in clearly communicating the plan for services to all
involved; they noted that a person-centered plan is only effective if
the people providing supports know what is included in the plan. Other
comments were primarily concerned with privacy and control over
personal information, noting that it is inappropriate to have an
individual commit intimate details to paper (such as goals, hopes for
personal relationships, etc.) and then require everyone involved in
that person's care--no matter their role--to read, sign, and keep a
copy. Many comments dealt with both signing and distributing the plan,
but we address these comments separately.
Response: In response to the commenters' concerns about privacy and
control over personal information, we have clarified in the final rule
who will sign the plan and who will receive copies of the plan by
revising Sec. 441.301(c)(2)(ix)) as follows: ``Be finalized and agreed
to, with the informed consent of the individual in writing, and signed
by all individuals and providers responsible for its implementation.''
Following are the comments we received on Sec.
441.301(b)(1)(i)(B)(7), which is now at Sec. 441.301(c)(2)(vii) of the
final rule.
Comment: The few comments received supported the proposed language
and went on to suggest specific examples, including making use of
interpretation and translation, customized communication supports, in a
format that is easily understood by the individual (Braille, ASL video,
diagram/pictures, etc.), and taking enough time for decision making.
Response: As with some other requirements in this rule, we
appreciate the examples given, but we do not think that CMS can list in
regulation all the possible specific methods and tools to accomplish
the desired outcome. For clarity purposes, we have added the term
``supports'' to this requirement.
Following are the comments we received on Sec.
441.301(b)(1)(i)(B)(8).
Most of the comments we received on this proposed requirement were
more applicable to other requirements and are summarized under those
headings. The requirements at Sec. 441.301(c)(1)(iii) regarding
timeliness and the requirements at Sec. 441.301(c)(1)(viii) regarding
a method for individuals to request updates to the plan are sufficient
and respectful of the individual's timeframe as reflected in the
person-centered planning process. Therefore, we are removing this
proposed requirement from the final rule. We did not receive comments
on the proposed requirement at Sec. 441.301(b)(1)(i)(B)(9), and adopt
it in the final rule at Sec. 441.301(c)(2)(viii).
Following are the comments we received on Sec.
441.301(b)(1)(i)(B)(10), which is now Sec. 441.301(c)(2)(x) of the
final rule.
Comment: Many of the comments on this proposed requirement are also
related to Sec. 441.301(b)(1)(i)(B)(6), regarding who must sign the
plan. Comments offered unique to the issue of distribution include
suggestions of specific parties who should get copies of the plan and
suggestions for case recordkeeping, including court or legal documents.
Commenters also inquired whether distribution meant to every entity
(for example, a company providing long term services and supports to
the individual), or also given to every individual from that entity
(for example, every direct service worker).
If the latter, concerns were expressed that parts of a true person-
centered plan include very personal information, as required in Sec.
441.301(c)(2)(iv) above--such as the individual's needs, aspirations,
and even complaints--making it inappropriate to distribute the plan to
everyone (that is, a housekeeper does not need to know about an
individual's relationship goals).
Response: We appreciate the comments on this section of the rule.
The language in the final rule specifies that the person-centered
service plan will be distributed to the individual and other people
involved in the plan. We have also revised the language in the final
rule at the Sec. 441.301(c)(2)(iv) to remove the examples and added
the term ``desired outcomes.''
Following are the comments we received on Sec.
441.301(b)(1)(i)(B)(11), which is now Sec. 441.301(c)(2)(xi) of the
final rule.
Comment: Some comments discussed ``self direction'' or
``participant direction,'' which while they sound similar to ``person-
centered'' are terms of art for a different concept, a method of
managing long term services and supports in which the individual
assumes employer authority and/or manages a budget for the services and
supports. A few comments discussed the distinction, while a few were
confused by these concepts.
Response: Amendments to this regulation do not specifically address
the issue of self direction. We issued extensive sub-regulatory
guidance and technical assistance on self direction of services, to
which we refer these commenters. We agree with commenters who pointed
out the importance of a person-centered planning process in
implementing self direction of services, and believe that the
requirements in this rule will facilitate self direction and other
complexities in planning long term services and supports.
Comment: Several commenters stated that this requirement is
unclear. One commenter thought the proposed regulation would require
self direction for all participants.
Response: We have clarified that the person-centered service plan
covers all aspects of services and supports, including self direction
where applicable, by rewording the text as follows: ``Include those
services, the purpose or control of which the individual elects to
self-direct.''
Following are the comments we received on Sec.
441.301(b)(1)(i)(B)(12), which is now Sec. 441.301(c)(2)(xii) of the
final rule.
Comment: One commenter stated that the funding for identified
supports needs to be in place for the plan to be implemented. Two other
commenters asked us to clarify that the full range of services
authorized by statute and included in the state's waiver proposal be
made available to program participants.
Response: These observations about providing all needed care are
the logical complement to the proposed language about unnecessary care.
Taken together they address proper utilization of services. We agree
that states must provide needed services to an eligible individual
enrolled in the waiver. We believe the current language appropriately
indicates that needed services must be provided, while unnecessary or
inappropriate services should not; however, we have changed the term
``care'' to ``services and supports.''
Comment: One commenter found this language to be ambiguous because
``prevent'' is imprecise. Services should not be unnecessary or
inappropriate.
Response: This requirement does not imply that the waiver offers
services that are inherently inappropriate or unnecessary. It refers to
the possibility
[[Page 3010]]
that particular services, or that the scope or frequency of them, may
be inherently inappropriate or unnecessary for a given individual,
especially as the individual's situation changes. One of the purposes
of any service plan for health or long term care services is to specify
the services a particular individual requires. There is no legitimate
advantage to the individual or to Medicaid in providing unneeded
services. However, some states or particular programs have historically
had difficulty controlling utilization; individuals may all be given
the maximum scope or frequency of service. We think that with the
addition noted in the response above, the existing language adequately
conveys the concept of appropriate utilization.
Comment: Some commenters asked that the rule include a reference to
the ``most integrated setting appropriate'' standard. Two commenters
consider this the most important aspect of the person-centered service
plan. Many commenters of all types stated that person-centered planning
should promote choice. However, regarding settings there was less
agreement on what choices should be offered. Many who were concerned
about preserving their present setting suggested they should be allowed
to choose to live wherever they wish, and not have their current choice
removed by a government policy.
Other commenters addressed the process of choice. They agreed with
the planning process as proposed and stated that setting should be
addressed, in terms of the individual's needs and goals. They asked
that in the planning process no types of residential provider or
housing options being offered to section 1915(c) of the Act HCBS waiver
participants be omitted from the discussion. They and some others also
suggested that this subject could be raised at regular intervals when
appropriate, as the person centered service plan is updated. Their
position was that competition among providers of residential settings
for waiver participants is a good thing and will promote growth of the
types of settings CMS seems to want to encourage, but will only work if
it is a fair competition with all approved settings presented neutrally
to the individual.
Some comments about settings in person-centered planning had more
to do with the definition of setting than with the planning process.
Response: We agree that the setting options in which an individual
resides should be an element in the person-centered service plan. We
have included it as a separate item under the list of ``Person-Centered
Planning Process'' requirements at Sec. 441.301(c)(1)(ix). It reads:
``Records the alternative home and community-based settings that were
considered by the individual.'' We respond to all of the setting
issues, such as landlord/tenant relationship, in our discussion of that
section of the rule. As all the comments on this subject make clear,
the process of choosing among the housing and service options actually
available to a particular waiver participant is an extraordinarily
multi-faceted issue. A truly person-centered planning process as
required in this rule is the best venue for facilitating this important
choice.
We also agree that part of meaningful choice is to be presented
with all available options. A person-centered planning process is not
about promoting certain options deemed to be more ``person-centered''
or otherwise desirable, than other options. A person-centered process
is one that puts the individual in the center, facilitated to make
choices that may be agreeable or disagreeable to some participating in
the process.
Therefore, we will require that the process of informed choice be
documented. Best practices that develop will inform future policy. A
new provision has been added at Sec. 441.301(c)(2)(i) to read:
``Reflect that the setting in which the individual resides is chosen by
the individual. The state must ensure that the setting chosen by the
individual is integrated in, and supports full access of individuals
receiving Medicaid HCBS to the greater community, including
opportunities to seek employment and work in competitive integrated
settings, engage in community life, control personal resources and
receive services in the community to the same degree of access as
individuals not receiving Medicaid HCBS.''
Comment: One commenter stated that CMS should use the person-
centered plan to ensure community integration.
Response: We agree that one of the essential purposes of the
person-centered service plan is to ensure community integration. In the
regulation at Sec. 441.301(c)(4)(i) we have clarified that home and
community-based settings must be integrated in, and that individuals
have full access to the greater community.
Comment: Other commenters offered specific additions to the
proposed rule that we considered but found to be either too
prescriptive or too detailed to require in regulation. For example, one
commenter urged CMS to establish benchmarks in the rule, as a
requirement for states to receive FFP for person-centered HCBS waivers.
Response: Many of these comments reflect good practice in
administering services. We believe that states have both sufficient
incentive and practical experience to be following such practices.
Where they are not, we offer a variety of technical assistance services
to state agencies, at no charge, to assist with these sorts of
practical strategies. We find this approach more productive and
flexible than specifying detailed regulations for operating the
program. In addition, some of these suggestions we have addressed in
sub-regulatory guidance such as instructions for the section 1915(c)
waiver application, letters or bulletins to State Medicaid directors,
and other vehicles.
Comment: One commenter recommended that CMS include specific
language in the final rule that updates to person-centered service
plans must be completed within a sufficient timeframe to meet the
individual's goals.
Response: Person-centered service plans must be reassessed at least
annually, and more frequently if the condition of the individual
changes, as indicated inSec. 441.365(e).
2. HCBS Settings Sec. 441.301(b)(1)(iv) (final Sec. 441.301(c)(4))
Through the proposed rule, we proposed to clarify and sought public
input on how to define the characteristics of home and community-based
(HCB) settings where waiver participants may receive services. In new
paragraph, Sec. 441.301(b)(1)(iv), we proposed clarifying language
regarding settings that will not be considered home and community-based
under section 1915(c) of the Act. We clarified that HCBS settings are
integrated in the community and may not include: facilities located in
a building that is also a publicly or privately-operated facility that
provides inpatient institutional treatment or custodial care; or in a
building on the grounds of, or immediately adjacent to, a public or
private institution; or a disability-specific housing complex designed
expressly around an individual's diagnosis, that is segregated from the
larger community, as determined by the Secretary.
We noted that this rule change does not exclude living settings on
tribal lands that reflect cultural norms or ALS for persons who are
older regardless of disability, when the conditions noted above in the
background section are met.
The clarification and request for input was partially in response
to instances in
[[Page 3011]]
which states or other stakeholders expressed interest in using HCBS
waivers to serve individuals in segregated settings or settings with a
strong institutional nature, for example, some proposed settings on
campuses of institutional facilities, segregated from the larger
community. These settings often do not allow individuals to choose
whether or with whom they share a room; limit individuals' freedom of
choice on daily living experiences such as meals, visitors, activities;
and limit individuals' opportunities to pursue community activities.
CMS' definition of HCBS setting characteristics has evolved over
the past four years, based on experience and learning from throughout
the country and feedback about the best way to differentiate between
institutional and community-based care. For example, in our April 4,
2008, proposed rule, Medicaid Program; Home and Community-Based State
Plan Services, (73 FR 18676), we used the number of unrelated people
living together in a facility to define whether or not a setting was
HCB. Our April 15, 2011,proposed rule, Medicaid Program; Home and
Community-Based Services (HCBS) Waivers, (76 FR 21432), no longer
included the number of residents as an HCB characteristic, but did
include a detailed list of the types of settings that do not qualify
for HCBS waivers because they are not integrated into the community.
Based on further public comment on these proposed regulations and on
the comments we received on the 1915(i) and 1915(k) proposed rule, we
are moving away from defining HCB settings by what they are not, and
towards defining them by the nature and quality of beneficiaries'
experiences. These final regulations establish a more outcome-oriented
definition of HCB settings, rather than one based solely on a setting's
location, geography, or physical characteristics.
Comment: Many commenters believe quite passionately that public
funds should only be used to support persons in ``home and community-
based'' settings--not institution-like or congregate facilities. A
commenter wrote, ``Please protect the interests of the disabled people
of the world and stand your ground and allow HCBS funds to be used for
their intended purposes.'' Another commenter stated, ``HCBS funds are
limited and designed to serve specific purposes, not to be available to
any and all settings which operate under the name `community'.''
Response: We agree with the general statement that waiver funds
should only be used for their intended purpose of supporting
individuals in the community. HCBS must be delivered in a setting that
meets the HCB setting requirements as set forth in this rule (except
for HCBS that is permitted to be delivered in an institutional setting,
such as institutional respite), and since the purpose of this authority
is to provide individuals with HCB alternatives to institutional
settings, individuals must be living in settings that comport with the
HCB setting requirements as set forth in this rule. We believe the
criteria set forth in the final rule will enable CMS to differentiate
between HCBS settings and non-HCBS settings for funding purposes.
Comment: Several commenters shared the sentiment that true
community integration is more than being in the community, but rather
truly participating in that community through working side by side with
others without disabilities in community activities, such as jobs,
clubs and other civic activities.
Response: We agree with this comment and believe that the changes
in the text of the final rule address tenets of community integration.
A home and community-based setting must be integrated in, and supports
full access of individuals receiving Medicaid HCBS to the greater
community, including opportunities to seek employment and work in
competitive integrated settings, engage in community life, control
personal resources, and receive services in the community, to the same
degree of access as individuals not receiving Medicaid HCBS.
Comment: A number of individual commenters shared personal stories
expressing satisfaction with their current living arrangements and
displeasure that new regulations might force them to move or dictate
where they should live. One person wrote, ``Please allow Medicaid
waivers to continue to pay for services in planned communities similar
to retirement communities. I want to live in a community with my
friends.'' Another noted, ``I believe this proposed rule would . . .
deny access to residential care and assisted living for those who need
it most.'' Many commenters talked about the importance of retaining
freedom of choice. One commenter stated, ``. . . what I am advocating
is CHOICE. We should be expanding options rather than narrowing
possibilities and options, and we should ask those with disabilities
and their families what they want, not what others think they want.''
Finally, quite a few commenters echoed a warning to stay away from a
``one size fits all'' approach in defining HCBS and to embrace more
flexibility: ``The needs and circumstances of each individual are too
diverse to warrant an outright ban on HCBS funding for individuals who
might need specialized care.'' They further challenged CMS that housing
and setting options should not be arbitrarily limited by defining HCBS
through physical and geographic structures, but rather through the
person-centered plan, personal outcomes and satisfaction.
Response: We very much appreciate hearing personal stories as they
help us better understand how our proposed actions will affect
individuals receiving services under the HCBS waiver program. We
believe that individual choice is important and have worked to promote
choice in the final rule. In addition, it is important to note that
HCBS waiver funding is only one way in which federal Medicaid finances
long term services and supports; a setting that may not meet the HCB
definition may still qualify for Medicaid financing, but not as a home
and community based service.
We agree that the definition we included in the proposed rule for
HCBS settings may have had the result of restricting the settings in
which HCB waiver services can be provided in a way that we did not
intend and in narrowing choices for participants. The final rule is
more flexible and less prescriptive in that it does not preclude
certain settings per se but rather establishes affirmative, outcome-
based criteria for defining whether a setting is or is not home and
community-based. The language in the final rule specifies that any
setting that is located in a building that is also a publicly or
privately operated facility that provides inpatient treatment, or in a
building on the grounds of, or immediately adjacent to, a public
institution, or any other setting that has the effect of isolating
individuals receiving Medicaid HCBS from the broader community of
individuals not receiving Medicaid HCBS, will be presumed to be a
setting that has the qualities of an institution unless the Secretary
determines, through heightened scrutiny, based on information presented
by the state or other parties, that the setting does not have the
qualities of an institution and that the setting does have the
qualities of home and community-based settings. Therefore, states and
others have the opportunity to refute this categorization by providing
sufficient evidence that the individuals in the facility are, in fact,
integrated in the community in a manner that overcomes any
institutional appearance of the setting. This means
[[Page 3012]]
that we will continue to be discerning about what types of settings
qualify for waiver funds. We are including language in the final rule
that focuses on the critical role of person-centered planning and
addresses fundamental protections regarding freedom, dignity, control,
daily routines, privacy and community integration.
Comment: A number of commenters cautioned that restricting living
situations reduces access to long term care in the community and may
force people back into nursing facilities. They advised that CMS not
include any specific restrictions on settings.
Response: We have made significant changes to this section of the
rule, but still define general tenets and characteristics of HCBS that
will preclude institutional settings from qualifying as HCB, although
they might qualify for Medicaid financing under other authorities. We
specifically noted that home and community-based settings do not
include: ``a nursing facility; an institution for mental diseases, an
intermediate care facility for individuals with intellectual
disabilities; a hospital, or any other locations that have qualities of
an institutional setting, as determined by the Secretary.'' Statutory
requirements specify that an individual be offered a choice between
services in an institutional setting or in a HCBS setting, therefore
making it necessary for us to define the difference. We recognize that
there are limited long-term care options in many communities and may be
few alternatives beyond institutional care. However, states need to
understand what qualifies as a home and community-based setting, and
also understand that this might trigger change and even dislocation. To
mitigate, we have developed specific provisions to allow for a
transition period, for existing approved HCBS waivers under 1915(c) in
accordance with section 441.301(c)(6). We will afford states the
opportunity to propose a transition plan that encompasses a period up
to five years after the effective date of the regulation if the state
can support the need for such a period of time. States are expected to
demonstrate substantial progress toward compliance throughout any
transition period. For states that are submitting renewals early in the
first year after this final regulation takes effect, states may submit
a request for a temporary extension to allow time to fully develop the
transition plan for that HCBS waiver program.
Comment: A couple of commenters expressed concern about negative
financial impact on providers.
Response: We appreciate the concerns regarding service providers
and wish to point out that states will have tremendous flexibility in
how they design 1915(c) waivers, including how they define services,
provider qualifications and service rate methodologies in their
programs. The purpose of this regulation is to ensure that
beneficiaries in Medicaid HCBS waivers receive services in home and
community-based settings that are true alternatives to institutional
settings and that states and providers have a clear understanding of
how applicable definitions will be applied by us.
Comment: One commenter thought that privacy is already protected in
administrative rules, so it is not necessary to address in this rule.
Response: We disagree with this comment and have included a
statement in the final rule about qualities that must be included in
HCBS, including the right to privacy.
Comment: A significant number of commenters recommended that CMS
remove the entire section on HCBS settings in the proposed rule from
the final rule.
Response: CMS has made significant changes to this section of the
rule, but has not eliminated it. We have listened to the many concerns
expressed by commenters regarding the description of HCBS settings and
have chosen a different, more person-centered and outcome-driven
approach for defining settings than what was described in the proposed
rule.
Comment: Commenters generally liked the CMS prohibition against
using HCBS waiver funds to provide services to individuals living in a
setting in which they are required to receive and participate in
services as a condition of continued tenancy. Further, some commenters
wanted CMS to require providers to promote aging in place. They stated
the need for additional qualified services and supports should not be
justification for asking a person to leave a setting; however, should
the person's needs exceed what legally can be provided in the setting,
appropriate transfer processes and protections must be in place.
Response: There is nothing in this rule that negates or waives
compliance with other Medicaid requirements, not specifically waived by
section 1915(c) authority, such as an individual's right to obtain
services from any willing and qualified provider of a service. In the
final rule, we have revised Sec. 441.301(c)(4) by replacing the
language with new requirements for HCBS settings, and at Sec.
441.301(c)(4)(v) we have included the following requirement that the
setting, ``facilitates individual choice regarding services and
supports, and who provides them.'' This requirement applies to all
settings including provider-owned or controlled residential settings.
Comment: A commenter asked if people currently living in settings
that do not meet the new criteria will have a grandfathering period to
move out or disenroll from the waiver. Many commenters strongly
encouraged CMS to allow sufficient time for states, providers, and
individual waiver participants and their families to make the
transition away from historic legacy settings that may not comport with
the proposed rule language, in order to minimize adverse impacts on
individuals and systems of services and supports. Some commenters
suggested that if we consider grandfathering non-compliant programs, we
should not make the grandfathered period permanent, but should only
allow grandfathering of existing homes located on the periphery of a
campus, but not separated by fencing or barriers.
Response: We understand that time is required to adjust to the new
requirements set forth in the final rule. The revised language in the
final rule includes the requirements for states to submit transition
plans for coming into compliance for existing programs and HCBS
waivers.
Comment: One commenter emphasized the need to involve stakeholders
in dialogue as CMS moves forward on working with states to implement
final regulations. Another commenter recommended that the Department of
Defense have the opportunity to provide recommendations that will
enhance military families' access to the waiver as they move from state
to state.
Response: We engaged in a public input process on the 1915(c)
regulation, which included both an Advanced Notice of Proposed
Rulemaking (ANPRM) and the Notice of Proposed Rulemaking (NPRM),
producing well over 2500 separate comments. We have taken the time to
thoroughly analyze comments from a wide range of stakeholders and
incorporate stakeholder suggestions in crafting the final rule. We have
also reviewed comments from the proposed rules for the 1915(i) and
1915(k) programs and have incorporated suggestions into this final rule
so that all three HCBS authorities are aligned. CMS is committed to
working with states and providing technical assistance, as needed, with
implementation of the final rule.
[[Page 3013]]
Comment: Many commenters suggested CMS clearly outline the
qualities of an institutional setting in the regulatory text and not
just in the preamble. One commenter proposed including a list of 12
qualities of an institution in the regulatory text.
Response: Rather than explicitly outlining the qualities of an
institution, we have chosen to more clearly outline the qualities of
home and community-based settings in the regulatory text. The final
language provides a specific list of five qualities that must be
present in order for a setting to be classified as home and community-
based, as well as additional criteria that must be met by provider-
owned or controlled settings. The final rule also notes that home and
community-based settings do not include nursing facilities,
institutions for mental diseases, intermediate care facilities for
individuals with intellectual disabilities, or hospitals.
Comment: Several commenters wanted more detail in the rule defining
HCBS ``settings.'' One commenter proposed that the following language
be added to the description of appropriate HCBS ``settings'' in the
rule: ``support exercising full rights and responsibilities as
community citizens'' and ``individualized services and supports.''
Another commenter proposed a list of nine person-centered attributes
that it believes should be found in all HCBS settings. The nine
attributes are: core values and philosophy, relationships and sense of
community, governance/ownership, leadership, workforce practices,
meaningful life and engagement, services, environment, and
accountability. Other commenters also provided differing views on
whether sheltered workshops, adult day care services, and other
congregate settings and non-residential facilities solely for persons
with disabilities should be considered HCB. Some believed that the rule
should exclude these settings from the HCBS definition as they still
have the qualities of an institution. Others, however, believed these
settings should qualify for waiver funding, stating that HCBS
characteristics should not apply only to residential services.
Response: 1915(c) HCBS must be delivered in a setting that meets
the HCB setting requirements as set forth in this rule. In addition,
since the purpose of this authority is to provide individuals with HCB
alternatives to institutional settings, individuals receiving 1915(c)
HCBS must be living in settings that comport with the HCB setting
requirements as set forth in this rule regardless of whether they are
receiving HCBS in that residence. This is consistent with CMS'
longstanding policy regarding 1915(c) HCBS.
Comment: Many commenters stated that they thought the regulation
should specify that an HCBS setting must not be located on the grounds
of, or immediately adjacent to, a private as well as a public
institution.
Response: We appreciate the commenters' concerns. It is expected
that all settings, public and private, meet the HCB setting
requirements of this regulation. These final rules specifically make
reference to a setting that is adjacent to a public institution in the
regulation language due to public input that stressed how such settings
inherently discourage integration with the broader community. We will
apply heightened scrutiny to such settings because of the likelihood
that they do not offer the characteristics of a home and community-
based setting and hinder or discourage integration with the broader
community.
Comment: Many commenters thought some terms in the proposed rule
were vague and/or needed further defining. For example, many commenters
wanted the rule to include clearer definitions for terms such as
``immediately adjacent to a public institution'' and ``housing complex
designed expressly around an individual's diagnosis or disability.'' At
least one commenter stated that terms like ``meaningful access'' and
``choice'' were too subjective to have a place in regulation.
Response: We appreciate some commenters' desires for more specific
and clear definitions in the final rule, but believe that highly
specific, close-ended parameters are limiting and often prove
ineffective. We are instead moving towards evaluating outcomes and
characteristics to determine whether or not a particular setting
produces desirable outcomes--while attempting to be as clear and
precise as possible in describing those outcomes and characteristics.
Where appropriate, CMS has added additional specificity to the final
rule.
Comment: Some commenters believe that ``immediately adjacent to a
public institution'' was unnecessarily restrictive. In contrast,
another commenter believed that use of the term ``immediately
adjacent'' was not restrictive enough, as ``it could allow HCBS housing
at an institution separated by a nature trail, parking lot or tree
line.'' One comment included the recommendation that we add the phrase:
``or sharing common employees or management with a public institution''
after the phrase ``immediately adjacent to a public institution.''
Response: We believe that the process for heightened scrutiny, as
described in the final rule, allows us to appropriately determine
whether such settings meet the HCBS requirements. We believe this
approach will allow us to take into account the kinds of issues the
commenters described.
Comment: Several commenters believed CMS should strike the term
``custodial care'' from the rule. Another commenter wanted us to
clarify whether ``custodial care'' prohibits care in foster care
settings.
Response: We agree that the term ``custodial care'' is unclear and
confusing and should not be included in the final rule. We have deleted
it from the regulatory text.
Comment: We received many comments that certain settings--such as
group homes, adult foster care, and assisted living facilities--should
qualify as home and community-based because many individuals consider
them to be their homes and to be a part of the community. On the other
hand, we also received comments from others that these types of
facilities are never appropriate as HCBS settings.
Response: Given the variability within and between types of housing
arrangements, CMS cannot determine simply by the type of group housing,
whether it complies with HCBS characteristics. As a result, particular
settings, beyond those specifically excluded in the regulation text,
will not automatically be included or excluded, but rather will be
evaluated using the heightened scrutiny approach described in the
regulation.
Comment: Commenters stated that the regulation should specify that
a ``housing complex designed expressly around an individual's diagnosis
or disability'' includes complexes that serve individuals with
different diagnoses or disabilities, as opposed to just individuals
with a particular diagnosis or disability. Another commenter requested
a definition of a housing complex that is designed expressly around an
individual's diagnosis or disability.
Response: We appreciated these comments, which indicated to us that
the language means different things to different populations and
programs. As a result of the comments we received, we have revised the
rule to remove the language, ``housing complex designed expressly
around an individual's diagnosis or disability,'' In the final rule, we
have removed this language. The regulatory text now includes the
following language: ``any other setting that has the effect of
isolating individuals receiving Medicaid HCBS
[[Page 3014]]
from the broader community of individuals not receiving Medicaid HCBS
will be presumed to be a setting that has the qualities of an
institution unless the Secretary determines through heightened
scrutiny, based on information presented by the state or other parties,
that the setting does not have the qualities of an institution and that
the setting does have the qualities of home and community-based
settings.'' We intend to issue additional guidance to provide examples
of the types of settings that will be subject to heightened scrutiny.
The guidance will also specify the process we will use to determine if
a setting meets the home and community-based criteria.
Comment: Commenters disagreed with proposed language that would
exclude ``housing designed expressly around an individual's diagnosis
or disability'' from the definition of an HCBS setting. They noted that
certain disabled populations (such as those with brain injury and
spinal cord injuries or Alzheimer's disease) require specialized
facilities and care designed to meet their specific needs. Commenters
stated that complexes designed around an individual's diagnosis or
disability serve as alternatives to institutionalized care and allow
residents to function with greater independence. We received a
significant number of comments from diverse groups of individuals
commenting that there are good reasons to live in residential settings
specific to individuals' needs.
Response: As noted above, the final rule no longer includes the
term ``housing designed expressly around an individual's diagnosis or
disability.'' The new regulatory language is restated above. We agree
that certain kinds of specialized settings may prove highly beneficial
to particular populations and may be well integrated into the
community. These factors will be taken into account when deciding
whether or not a setting should qualify for HCBS waiver funding.
Comment: Some commenters asked CMS to look into HCBS settings'
implications for intersection with HUD 811 and 202 projects and whether
this will result in people losing housing. They encouraged CMS to look
at potential conflicts with Fair Housing rules and work collaboratively
with HUD and the Department of Agriculture so that we better coordinate
available federally subsidized housing options with delivery of waiver
services. One commenter who believed that HUD-funded independent
housing should qualify stated, ``We would urge the Secretary to use her
discretion to recognize that even those Section 811 housing
developments that are designed `expressly around an individual's
diagnosis or disability' are often the most community-based and
inclusive housing model available, and it would be illogical to deny
HCBS waiver funds to support services to an individual living in such a
setting.''
Response: We have worked closely with HUD and other federal
agencies on the impact of this regulation on federally supported
housing options. We believe the changes to the final rule allow for the
appropriate designation of HCBS settings and for sufficient transition
time for states to comply.
Comment: One commenter suggested that a ``home'' should not be
considered ``in the community'' if more than four unrelated people live
in the home.
Response: In the 2008 1915(i) Notice of Proposed Rulemaking, we did
propose defining institutional care based on the number of residents
living in the facility. However, we were persuaded by public comments
that this was not a useful or appropriate way to differentiate between
institutional and home and community-based care. As a result, we have
now determined not to include or exclude specific kinds of facilities
from qualifying as HCBS settings based on the number of residents in
that facility. We have, however, established a list of specific
conditions that must be met in provider-owned or controlled residential
settings in order to qualify as HCBS.
Comment: A commenter thought CMS should not allow clusters of homes
in gated communities to qualify as an HCBS setting. Others objected to
classifying facilities on campus settings or farms as HCBS. On the
other hand, many people supported categorizing these facilities as
HCBS, noting that cluster or campus living may promote health and
welfare in emergencies because of physical proximity. Many commenters
expressed concern that the proposed rule would exclude rural farmsteads
and farm communities for individuals with autism from receiving waiver
funds. These commenters noted that rural, agricultural settings are
desirable for people with autism, as they provide safe, calm
environments--whereas urban settings can prove dangerous and
disorienting.
Response: The Secretary will determine through heightened scrutiny,
based on information presented by the state or other parties, whether
such complexes do or do not have the qualities of an institution and
whether these complexes have or do not have the qualities of home and
community-based settings. We will evaluate both rural and urban
settings based on whether they have the characteristics required under
the regulation.
Comment: Several commenters suggested that CMS needed to be careful
of the unintended consequences of the prescriptive language about
settings in the proposed rule that would force people to move from
their long term homes in the community and lose services. Some
commenters stated that CMS must also be open to unique situations and
different types of living situations that may be designed for people in
rural areas.
Response: We have considered the many concerns expressed by
commenters regarding the description of HCBS settings in the proposed
rule. Through the final rule we have chosen a different, more person-
centered, outcomes-based approach than what was described in the
proposed rule in part to address concerns about unintended consequences
of specific language that was used in the proposed rule about settings.
Comment: There were several themes that emerged amongst the many
commenters who agreed with the proposed language in the rule regarding
home and community-based settings. Some commended CMS for taking a
stand on what comprises home and community qualities. Others
appreciated that we were using characteristics that will help people
truly be included in their communities and not just focusing on size or
location of settings. Other commenters specifically mentioned that
institutions and other congregate settings should not be a part of a
waiver and should not be allowed to call themselves HCBS. Commenters
agreed that use of person centered planning, flexibility regarding
meals and availability of food, control over daily activities, free
access to visitors and privacy are all hallmarks of community living.
Individual commenters and the general public focused on the importance
of using waiver funding for people with disabilities to live in the
community like everyone else and not be shut away from other people.
Response: We concur with much of the content from these commenters.
Through the final rule we have chosen to take a somewhat different
approach from what was described in the proposed rule in order to
address the different commenters with divergent views on this issue.
Specifically, we have chosen to be somewhat less prescriptive regarding
physical and geographical characteristics of settings and to focus
instead on the critical role of person-centered service planning
[[Page 3015]]
and on characteristics that are associated with independence, control,
daily routines, privacy and community integration. Further, with
respect to certain types of settings, the final rule specifies that the
Secretary will determine through heightened scrutiny, based on
information presented by the state or other parties, that the setting
does not have the qualities of an institution and that the setting does
have the qualities of home and community-based settings.
Comment: One commenter suggested that the proposed language runs
counter to consumer choice, would restrict important specialized
programming, and is counter to the entire course and direction of the
waiver program recommending that CMS delete the proposed section in its
entirety and begin anew by convening stakeholders to discuss this
critical definition. The commenter added that these conditions are a
first attempt to regulate federally the assisted living environment
which could and should remain at the state level.
Response: This rule applies to all settings where individuals are
receiving HCBS and does not single out assisted living environments. It
is intended to assure, consistent with the statute, that Medicaid
financing provided through HCBS waivers is available to participants
who are receiving services in settings that are true alternatives to
institutional care.
3. Target Groups Sec. 441.301(b)(6)
Under section 1915(c) of the Act, the Secretary is authorized to
waive section 1902(a)(10)(B) of the Act, allowing states not to apply
requirements that the medical assistance available to categorically-
eligible Medicaid individuals must not be less in amount, duration or
scope than the medical assistance made available to any other such
individual, or the medical assistance available to medically needy
individuals. We have interpreted this authority to permit States to
target an HCBS waiver program to a specified group of individuals who
would otherwise require institutional care. A single section 1915(c)
waiver may, under current regulation, serve one of the three target
groups identified in Sec. 441.301(b)(6). As provided in the rule,
these target groups are: ``Aged or disabled, or both; Individuals with
intellectual or developmental disabilities, or both; and Mentally
ill.'' States must currently develop separate section 1915(c) waivers
in order to serve more than one of the specified target groups. A
federal regulatory change that permits combining targeted groups within
one waiver will remove a barrier for states that wish to design a
waiver that meets the needs of more than one target population.
This regulatory change will enable states to design programs to
meet the needs of Medicaid-eligible individuals and potentially achieve
administrative efficiencies. For example, a growing number of Medicaid-
eligible individuals with intellectual disabilities reside with aging
caregivers who are also eligible for Medicaid. The proposed change will
enable the state to design a coordinated section 1915(c) waiver
structure that meets the needs of the entire family that, in this
example, includes both an aging parent and a person with intellectual
disabilities. In this illustration, the family currently would be
served in two different waivers, but with the proposed change, both
could now be served under the same waiver program.
The revisions to Sec. 441.301(b)(6) will allow states, but not
require them, to combine target groups. Under this rule, states must
still determine that without the waiver, participants will require
institutional level of care, in accordance with section 1915(c) of the
Act. The regulation will not affect the cost neutrality requirement for
section 1915(c) waivers, which requires the state to assure that the
average per capita expenditure under the waiver for each waiver year
not exceed 100 percent of the average per capita expenditures that will
have been made during the same year for the level of care provided in a
hospital, nursing facility, or ICF/IID under the state plan had the
waiver not been granted. We will provide states with guidance on how to
demonstrate cost neutrality for a waiver serving multiple target
groups.
The comments provided on this provision were largely positive,
advising CMS to carefully consider quality elements and protections
needed to ensure that all target groups are protected sufficiently in
such a structure. Through this final rule, we include the requirements
that each individual within the waiver, regardless of target group, has
equal access to the services necessary to meet their unique needs.
Comment: A theme expressed by the majority of commenters who
disagreed with this provision in the rule centered around potential
negative impact on consumers. These included using the combining of
target groups to limit service packages, serve less people overall,
limit choices and create infighting among different disability groups.
Several commenters were concerned that states would make decisions
based on service/cost, which may lead to less adequate services for
people with disabilities.
Response: Challenges regarding limited resources at the state level
already exist and will continue to exist whether or not a state chooses
to pursue combining target populations in one waiver. This change to
the regulation is not intended to have any impact on payment rates for
services. To ensure transparency and input, we strongly encourage
states interested in this option to consult with affected stakeholders
in advance of implementation.
Comment: Several commenters expressed concern that combining of
target groups will lead to frustration for states and cause barriers to
timely innovations.
Response: The intention in the rule is to provide options to states
that foster creativity and better integration of services across
populations, which may lead to administrative efficiencies in state
Medicaid agencies. The intent is not to prevent or inhibit innovation
and the decision to combine target groups is optional for the state.
Comment: A few commenters noted that people with various
disabilities, for example people with developmental disabilities,
people with mental illness and frail elders, have different needs from
each other and should not be residing together in housing situations.
Further, they described how this can lead to dangerous situations that
may threaten the well-being of more vulnerable individuals, such as
frail elders when they reside with younger people with disabilities,
particularly if there is any potential that such disabilities would
make a person more likely to engage in any dangerous or aggressive
behavior.
Response: The changes to this section of the regulation do not
speak to combining different target groups in the same living
situations, but rather to the inclusion of multiple target groups in
the overall waiver design and operation. Including multiple target
groups in one waiver will not alleviate responsibilities of states for
ensuring the health and welfare of all participants and detailing their
quality improvement strategies for that waiver. The final rule at Sec.
441.302(a)(4) specifies that, if a state chooses the option to serve
more than one target group under a single waiver, the state must assure
that it is able to meet the unique service needs that each individual
may have regardless of the target group.
Comment: A commenter recommended that if states are permitted to
combine target populations
[[Page 3016]]
in a single waiver, CMS must expressly require a right of beneficiary
choice.
Response: Including multiple target populations in one waiver does
not change freedom of choice requirements that exist in Medicaid
generally and in 1915(c) waivers specifically. Regardless of whether a
state includes multiple target populations, all included services must
be made available to those enrolled in the waiver who demonstrate a
need for the services (as indicated in the person-centered assessment
and service plan).
Comment: A number of commenters who disagreed with this provision
responded to perceived changes that were not contemplated in the
proposed rule. One commenter thought this rule would cause cost-
neutrality issues between populations. Interestingly, some commenters
thought the proposed rule would mandate states to combine target
populations and believed it should be a state choice.
Response: The concern that cost neutrality would become problematic
in waivers with combined target groups should not be a factor, as cost
neutrality is calculated based on the relevant level of care group in
the waiver, not by target population. For example, people with physical
disabilities who meet nursing facility level of care would need to meet
that cost neutrality level and people with intellectual disabilities
would still need to meet the cost neutrality for ICF/IID level of care.
In fact, multiple levels of care are an option currently in waivers
where a particular target population may include multiple levels of
care within the same waiver. As this choice is optional, the state will
have the opportunity to submit two separate waivers if cost neutrality
was not initially met with one waiver. Neither the proposed rule nor
the final rule mandates states to combine target populations, but
rather provides this option for states.
Comment: Several commenters were concerned that people who are
currently receiving waiver services would lose their services if the
state combined population specific waivers into one waiver that
included multiple target groups. They suggested that CMS require
appropriate safeguards to protect current participants.
Response: In an effort to ensure that safeguards are in place to
protect the health and welfare of each waiver participant, the
requirement in the final rule at Sec. 441.302(a)(4) specifies that
states must assure us that they are able to meet the unique service
needs that particular target groups may present when the state elects
to serve more than one target group under a single waiver. In the
Instructions and Technical Guide for section 1915(c) HCBS waiver
applications, we currently require a transition plan for waiver
participants who may be adversely affected when a change through
amendment, renewal consolidation, or the termination of a waiver
occurs.
Comment: Several commenters asked for clearer expectations around
quality measurement and related documentation.
Response: Combining waiver target groups will not alleviate
responsibilities of states for ensuring the health and welfare of all
participants and detailing their quality improvement strategies for
that waiver. Further guidance on waiver quality improvement strategies
is addressed in the Instructions and Technical Guide for section
1915(c) HCBS waiver applications. We believe there may be potential for
efficiencies by having a uniform quality system in one waiver that
serves multiple target populations.
Comment: Several commenters would like to see CMS allow states to
define different services packages for subgroups within combined
waivers. Other commenters asked CMS to clarify that equal access does
not mean that each individual receives the same type, amount, duration
or scope of service. In addition, one commenter recommended that
waivers serving multiple target groups should not be required to cover
the array of services specifically needed by each of the covered groups
as well as generic services that will benefit all. Another commenter
suggested that CMS require a common service menu for all target
populations.
Response: States may continue to design and keep 1915(c) waivers by
individual target group and not choose to combine target groups. If
they combine target groups in one waiver, equal access means that all
included services must be made available to those who need them (as
indicated in the person-centered assessment and service plan). This
does not mean that individuals with differing needs would receive the
same array, amount, duration or scope of services. Nothing in the
proposed or final rule changes state flexibility in choosing services
to meet the needs of people in waivers.
Comment: Several commenters raised the issue of waiting lists and
the potential to crowd out one population group due to pent up demand
with long wait lists for another group; this was specifically mentioned
in relation to older adults not having timely access to services.
Response: One of the options available to states to ensure the
continuation of services to incoming multiple target groups under one
waiver is to reserve capacity. Reserving capacity is only a means to
hold waiver openings for the entrance of specific sets of individuals
to the waiver. Capacity cannot be reserved to limit access to a
specific waiver service. All individuals who enter the waiver must have
comparable access to the services offered under the waiver. For
example, capacity may not be reserved to limit the number of waiver
participants who may direct some or all of their waiver services.
Comment: Several commenters pointed out that due to Medicaid's
historic institutional bias, home and community-based services are
still generally under-resourced relative to facility-based care. One
commenter suggested that CMS not allow states to use newly combined
waivers to cut back on HCBS services overall, as such a move would be
inconsistent with a state's obligations under Olmstead.
Response: We intend to offer more opportunities to states to
facilitate their participation in HCBS options, not to reduce states'
participation in 1915(c) waivers or limit HCBS services. Further, this
regulation change does not alleviate states' independent obligations
under the Americans with Disabilities Act or the Supreme Court's
Olmstead decision.
Comment: One commenter recommended that states be allowed the
flexibility to create waivers that include hybrid care arrangements
that have some institutional components.
Response: Since the waivers are statutorily designed for the
purpose of providing HCBS as an alternative to institutional care, we
disagree with this comment.
Comment: Several commenters agreed with this section of the rule
but recommended that cost neutrality calculations be based either on
combined calculations or on the target group with the higher estimated
cost--not calculated separately for each population group. It was also
recommended that we provide more detail on cost neutrality calculations
in the regulation text, including whether states would have the option
to combine populations with different institutional levels of need into
one waiver. Several other commenters thought that states should be able
to limit the number of waiver participants in each target group to
maintain fiscal neutrality.
Response: Combining target groups allows states to combine people
with different levels of care, for example, people with ICF/IID level
of care and NF level of care, in the same waiver. Cost neutrality is
calculated by level of care,
[[Page 3017]]
not target group. The Instructions and Technical Guide for section
1915(c) HCBS waivers provide guidance on calculating cost neutrality
with multiple levels of care in one waiver. The current waiver
application already prompts the user to enter costs for each level of
care and then aggregates them for one combined cost neutrality test.
States can choose to combine multiple target groups in a single waiver
or continue to use separate waivers for each target group.
Comment: Several commenters shared concerns about cost limits
negatively impacting particular populations by either being set too low
or too high. CMS was also asked to calculate and monitor the baseline
combined funding for individual populations.
Response: We do not believe that this change to regulation will
have any impact on a state's choice to select or not select individual
cost limits. We currently require states to report on funding for
waiver services to ensure cost neutrality by waiver. At Sec.
441.302(a)(4)(i), we have also included a requirement for states to
report annually in the quality section of the CMS-372, data that
indicates the state continues to serve multiple target groups in a
single waiver and that a single target group is not being prioritized
to the detriment of other groups.
Comment: A few commenters recommended that CMS require states to
apply savings from newly combined waivers proportionately and equitably
to target groups affected for the purpose of addressing waiting lists
and expansion of access to waiver services.
Response: This comment goes beyond the statutory scope of what we
can require in the context of section 1915(c) waivers.
Comment: A commenter asked CMS to clarify which state agency(s)
will be authorized to implement the waiver (for example, state agency
on aging or state agency dealing with ID/DD issues) when a state
chooses to submit a combined waiver.
Response: In accordance with Sec. 431.10, the Medicaid Agency is
responsible for ensuring that a waiver is operated in accordance with
applicable federal regulations and the provisions of the waiver itself.
However, it may delegate operational activities and functions to
another state agency (operating agency) to perform under the
supervision and oversight of the State Medicaid Agency. Decisions
around the design of waiver administrative structures rest with the
state, subject to CMS requirements that the Medicaid Agency retains
ultimate authority and responsibility for the operation of the waiver.
Greater detail on waiver administrative structures is provided in the
Instructions and Technical Guide for section 1915(c) waivers.
Comment: Several commenters indicated that CMS should employ the
lessons learned through the Aging and Disability Resource Center (ADRC)
model.
Response: We agree that allowing states, at their discretion, to
combine target groups in one waiver is consistent with one of the
principles of the ADRC model to allow a cross disability population
approach, as appropriate. Further, and as some other commenters noted,
it is critical that if states choose to combine target populations in
one waiver, they must assure CMS that they are able to meet the unique
service needs that each individual may have regardless of target group,
and that each individual in the waiver has equal access to all needed
services.
Comment: Several commenters raised clarifying questions about
combining of target groups. One commenter asked how waitlists would be
handled--by population group, services or in some other manner. Several
other commenters requested further clarification around wait lists.
Response: Through current guidance in the Instructions and
Technical Guide for section 1915(c) waivers, CMS allows states to
prioritize selection of entrants into a waiver, so a state has the
flexibility to structure prioritization for waiver entry. However, once
a person has entered the waiver all included services must be made
available to those who need them (as indicated in the person-centered
assessment and service plan).
Comment: One commenter asked CMS to clarify what ``equal access''
means. ``Can there be different sets of services within a combined
waiver targeted to specific groups?''
Response: Equal access means that once individuals have enrolled in
the waiver all services in the waiver must be made available to them,
if needed (as indicated in the person-centered assessment and service
plan).
Comment: Commenters raised several concerns related to case
management. One commenter stated that the case management entity should
not be able to also be the agency that is administering the self-
directed hours as the payroll agent. Another commenter expressed
concern about combining disability populations in terms of quality of
case management provided, the number of people for whom states can
provide case management and how states can differentiate populations
and services.
Response: We continue to appreciate the critical role of case
management in the lives of waiver participants. How states set up their
case management system for a waiver with combined target groups will be
an important consideration. Through appropriate provider
qualifications, we believe that states will be able to ensure that
waiver case management services meet the needs of populations served.
Comment: There were several themes amongst the many commenters who
agreed with the proposed language in the rule. These themes included
supporting flexibility to allow a family-based approach to service
design and delivery, improving access, reducing inequities and
fragmentation between disability groups and improving administrative
efficiencies at both the provider and state levels. Several commenters
spoke favorably about how combining target groups would allow both an
aging parent and a person with intellectual disabilities to be served
in the same waiver. Other commenters commended CMS for breaking down
``silos'' between populations of people with different disabilities by
allowing states to combine target groups in waivers. A few commenters
expressed particular support related to the rule change's potential
impact on expanding opportunities for people with mental illness to be
served in waivers, as they have historically been underserved in
section 1915(c) of the Act waivers.
Response: We appreciate these comments and are retaining the
proposed language in this section of the rule.
4. State Assurances (Sec. 441.302)
In an effort to ensure that safeguards are in place to protect the
health and welfare of each waiver participant, we proposed in a new
paragraph Sec. 441.302(a)(4) that to choose the option of more than
one target group under a single waiver, states must assure CMS that
they are able to meet the unique service needs that each individual may
have regardless of target group, and that each individual in the waiver
has equal access to all needed services.
Comment: Many commenters who agreed with the proposed changes in
targeting stated that a comprehensive service array that ``meets the
unique service needs'' of each individual in each target group is
critical and that regulation language needs to be strengthened.
Additionally, they believe that the provider expertise for specialty
populations needs to be maintained. Multiple commenters singled out
people with ID/DD in this vein as being at risk without appropriate
safeguards to tailor
[[Page 3018]]
service packages and provider qualifications to meet their needs.
Response: We agree with this comment and strengthened the language
included in Sec. 441.302(a)(4) that directs states to ensure that the
unique service needs are met. For participants enrolled in the same
waiver, states cannot restrict services to certain target groups or
choose to provide some services only to people with particular
diagnoses. The language in the final rule at Sec. 441.302(a)(4) will
now read, ``Assurance that the state is able to meet the unique service
needs of the individuals when the state elects to serve more than one
target group under a single waiver, as specified in Sec.
441.301(b)(6).''
Comment: One commenter noted that ``selects to serve'' should be
changed to ``elects to serve'' in regard to state choice about
combining target populations in proposed Sec. 441.302(a)(4).
Response: We agree and will change the regulation text to read
``elects to serve'' instead of ``selects to serve'' at Sec.
441.302(a)(4).
In addition, to ensure that services are provided in settings that
are home and community-based, we proposed in a new paragraph Sec.
441.302(a)(5) that states provide assurance that the settings where
services are provided are home and community based, and comport with
new paragraph Sec. 441.301(c)(4). While we are not changing the
existing quality assurances through this rule, we clarified that states
must continue to assure health and welfare of all participants when
target groups are combined under one waiver, and assure that they have
the mechanisms in place to demonstrate compliance with that assurance.
We received no comments on Sec. 441.302(a)(5) and we will adopt
the proposed language.
5. Duration, Extension, and Amendment of a Waiver (Sec. 441.304)
At Sec. 441.304, we made minor revisions to the heading to
indicate the rules addressed under this section. We revised Sec.
441.304(d) and redesignated current Sec. 441.304(d) as new Sec.
441.304(g).
a. Waiver Amendments With Substantive Changes (Sec. 441.304(d))
The new Sec. 441.304(d) will codify and clarify our guidance
(Application for a section 1915(c) Home and Community-Based Waiver, V.
3.5, Instructions, Technical Guide and Review Criteria, January 2008)
regarding the effective dates of waiver amendments with substantive
changes, as determined by CMS. Substantive changes include, but are not
limited to changes in eligible populations, constriction of service
amount, duration, or scope, or other modifications as determined by the
Secretary. We added regulatory language reflective of our guidance that
waiver amendments with changes that we determine to be substantive may
only take effect on or after the date when the amendment is approved by
CMS, and must be accompanied by information on how the state has
assured smooth transitions and minimal adverse impact on individuals
impacted by the change.
CMS received 43 comments regarding Sec. 441.304(d), which will
clarify and codify existing technical guidance governing the effective
dates of waiver amendments that make substantive changes.
Comment: Several commenters expressed concern that this requirement
could be problematic if a state is directed by its legislature to make
a change to a waiver program prior to CMS approval of an amendment
implementing that change. CMS should consider this possibility as it
finalizes this rule. There is no allowance for emergency situations or
changes that might benefit clients or providers in the broad definition
of ``substantive.''
Response: The intention in the rule is to codify our current
practice regarding what types of amendments must be implemented
prospectively.
Comment: A commenter thought that retroactive approvals of waiver
amendments should never be allowed.
Response: We believe there are situations when a retroactive
approval is permissible. For example, codifying the continuation of the
current practice for states of being able to increase the number of
waiver participants served retroactively allows states to serve more
people, while continuing to plan and manage waiver growth within their
budgets.
Comment: A number of commenters wanted CMS to further clarify what
constitutes a substantive change; however, the commenters varied in
what they believe a substantive change should include. Several
suggested that only changes to eligibility standards, procedures, or
methodologies should be considered substantive; others recommended that
elimination or reduction in services, and changes in the scope, amount
and duration of services, as well as changes in provider rates, would
always constitute ``substantive changes.''
Response: Given the range of comments on what a list of substantive
changes should include, we believe it prudent to maintain most of the
language in the proposed rule around the types of examples of
substantive changes, while leaving flexibility to the Secretary to
determine other types of proposed changes that may also be considered
substantive. We have, however, changed the phrase ``change in the
eligible population'' to ``constriction in the eligible population'' in
the final rule to be more specific about the kind of change that would
constitute a ``substantive change.'' We have also rewritten the phrase
``changes in the scope, amount, and durations of the services'' to read
``reduction in the scope, amount, or duration of any service'' to
further clarify what constitutes a substantive change. We also believe
that a listing of only changes to eligibility standards, procedures, or
methodologies is too broad regarding what constitutes a substantive
amendment. We do, however, make clear that a state must submit
amendments for prospective review and approval by CMS that may have a
potentially negative impact on waiver participants, as well as that the
amendment must be accompanied by information on how the state has
assured smooth transitions and minimal adverse impact on individuals
affected by the change.
Comment: Several commenters wanted CMS to be more precise with
language in this section of the rule. One asked that the list of
examples of substantive items not be defined as exhaustive and several
other commenters thought the use of ``may include'' in regard to
substantive changes, was too permissive. Another commenter recommended
that CMS state that the elimination or reduction in services and
changes in the scope, amount, and duration of services will always
constitute ``substantive changes.''
Response: We agree that the term ``may include'' is not
sufficiently precise to be helpful. We have deleted the word ``may''
from Sec. 441.304(d)(1) and have rewritten this section of the rule as
follows: ``Substantive changes include, but are not limited to,
revisions to services available under the waiver including elimination
or reduction of services, or reduction in the scope, amount, and
duration of any service, a change in the qualifications of service
providers, changes in rate methodology or a constriction in the
eligible population.'' We believe the current language noting that the
list of substantive examples is not limited to just the changes listed
is sufficiently clear.
Comment: A few commenters wanted CMS to allow states to gain
retroactive
[[Page 3019]]
approval to the date of the submission of the amendment, as opposed to
the date CMS approved the amendment. The commenters noted that using
the date of CMS approval can present significant challenges to a state
when it is under legislative mandate to make a change or implement a
budget initiative.
Response: While we are sympathetic to the budgetary challenges
faced by states, we believe it would not be in the best interest of
waiver participants to allow approval retroactive to the date of
substantive amendment submissions. The rule reflects and maintains our
current waiver amendment review procedures.
Comment: Commenters agreed with several aspects of the proposed
language in the rule regarding substantive changes to amendments. Some
liked that CMS is not allowing substantive changes in an already
existing waiver to take effect until the waiver has been approved by
CMS, as this will help ensure that waivers fulfill the mandate of the
HCBS waiver program. A commenter agreed with CMS's definition of
substantive changes. Another commenter noted that he liked that a state
will need to demonstrate how it will ensure smooth transition and
minimal disruption to service or adverse impact of a change on
beneficiaries.
Response: We concur with these comments. We agree that the rule is
being changed to achieve the purposes outlined by these commenters.
b. Public Notice and Input (Sec. 441.304(e) and (f))
Given the important requirement at Sec. 447.205, which describes
states' responsibilities to provide public notice when states propose
significant changes to their methods and standards for setting payment
rates for services, we added a new paragraph Sec. 441.304(e) to remind
states of their obligations under Sec. 447.205. We further included a
new paragraph Sec. 441.304(f) directing that states establish public
input processes specifically for HCBS changes. These processes,
commensurate with the change, could include formalized information
dissemination approaches, conducting focus groups with affected
parties, and establishing a standing advisory group to assist in waiver
policy development. These processes must be identified expressly within
the waiver document and used for waiver policy development. The input
process must be accessible to the public (including individuals with
disabilities) and states must make significant efforts to ensure that
those who want to participate in the process are able to do so. These
processes must include consultation with federally-recognized Indian
Tribes in accordance with federal requirements and the state must seek
advice from Indian health programs or Urban Indian Organizations prior
to submission of a waiver request, renewal, amendment or action that
would have a direct effect on Indians or Indian health providers or
Urban Indian Organizations in accordance with section 5006(e) of the
American Recovery and Reinvestment Act of 2009 (Pub. L. 111-5, enacted
on February 17, 2009).
We received 102 comments regarding Sec. 441.304(e) and (f), which
would clarify the public input and notice requirements for all section
1915(c) waiver actions.
Comment: One commenter thought the description of a public input
process for any changes in services or operations of a waiver was too
broad.
Response: The intent in the rule is to strengthen our current
practice of encouraging states to engage in a public input process in
order to ensure such input without being overly prescriptive to states
in how that process is implemented. The language in the rule gives
states examples for soliciting such public input, while not limiting
additional methods that may work better in particular states and/or for
particular waivers.
Comment: Several commenters asked CMS to provide more specific
requirements around process, time frames and methods used for public
input. One suggested adding a provision that states must provide public
notice of waiver amendments and provide information, training, and
technical assistance to stakeholders, including individuals enrolled in
the waiver and their families, when waiver amendments include
substantive changes. Another suggested that we require specific
activities that would ensure real input, participation and
transparency; such as minimum times for posting notice of changes (30
days), listing of specific mechanisms or venues for posting, a
listserv, mandatory stakeholder meetings, posting on CMS Web sites of
all active and pending waivers, submission of all public comments and
state actions to address those comments. Other commenters suggested
more generally that CMS establish some threshold for minimum public
input process elements in the regulation. Another approach recommended
was for CMS to provide a standard against which a state will be
measured to demonstrate that a public input process is ``sufficient.''
Response: While we appreciate the suggestions of the commenters to
strengthen the public notice and input requirements in the regulation,
we believe that the level of detail suggested in some of the comments
is not appropriate for regulation; additionally, some of these
suggestions may be addressed in future guidance. However, we do agree
with the comment suggesting implementing a minimum amount of time for
posting notice of changes. In the final rule, we have included language
stating that we will require that the State provide the public a period
of no less than 30 days in which to provide input on a rule change
prior to implementation of that change or submission of the proposed
change to CMS, whichever comes first.
Comment: One commenter was concerned that extensive public input
periods could prove challenging.
Response: We believe that the time period specified is not
extensive, but rather appropriate to allow for meaningful public input
based on the breadth of the changes.
Comment: A commenter expressed concerns that since states are
already required to develop a process for tribal consultation that
meets ARRA requirements, requiring the state to consult with all the
tribes would require a different process for waiver changes.
Response: We do not believe that the guidance in the rule is in
conflict with provisions in 5006(e) of the American Recovery and
Reinvestment Act of 2009 (ARRA), which required solicitation of advice
from Indian health programs and urban Indian organizations.
Comment: A number of commenters thought CMS should provide further
clarification on what types of actions are considered substantive and
would be subject to a public input process; however, there were
differing opinions as to what level of change required public input.
Several commenters thought it should include changes in policies such
as qualifications of service providers, eligibility requirements, and
changes to services covered in the waiver. Others thought that any
changes in services or operations of the waiver would require public
notice and input.
Response: Consistent with our response to comments regarding waiver
amendments with substantive changes, we believe that it would be
difficult to come up with an exhaustive list of specific items that
would be considered substantive beyond the general categories we listed
in the proposed rule. Further, what may be a substantive change for one
waiver may be less significant in a different waiver or in a different
state depending on the waiver design and the service package.
Therefore, we believe that the regulation
[[Page 3020]]
is currently worded to invite public input when it is appropriate;
adding further detail in the regulation would not be beneficial.
Comment: A number of commenters made recommendations about
accessibility standards to ensure that the broadest range of
stakeholder input is obtained. Most specifically, commenters wanted to
assure that people with disabilities, including people with vision and
hearing impairments; other cognitive, mental, or physical disabilities;
and people with limited English proficiency were included in the
process in a meaningful way. One of the suggestions was to make sure
they were included on standard advisory groups. Again, the suggested
methods to accomplish this level of accessibility varied greatly. A
commenter asked that CMS include language from the preamble in
regulatory text that requires accessibility for public input. Others
asked that CMS detail how individuals or organizations can submit oral
or written input. While there were a few comments that service
providers should be required to be part of an input process, we
received more comments about making sure that people with disabilities
have access to an input process.
Response: By requiring states to detail the processes they used to
solicit input from the public in the waiver application, we will have
an appropriate oversight mechanism to review the integrity of a
specific waiver and specific state processes. We also have a mechanism,
as noted in the proposed rule at Sec. 441.304(f)(1), to specifically
look at how the process included and was made accessible to people with
disabilities. This requirement specifies that, ``this process must be
described fully in the state's waiver application and be sufficient in
light of the scope of the changes proposed, to ensure meaningful
opportunities for input for individuals served, or eligible to be
served, in the waiver.''
Comment: A theme from several commenters was that CMS should
establish specific guidelines and accountability mechanisms for states
around public notice. Some of the types of suggestions we received
included requests for CMS to: add a requirement that the agency reply
to public comments received; file the public comments and agency
replies with CMS; include language to require written legal decisions
for compliance with Open Meetings Act/Sunshine Laws; add an
accountability measure to use a public input process for a state
agency; and monitor compliance through subsequent audits that would
include interviews with people with disabilities and other stakeholders
to determine the level of public input and decision making.
Response: By requiring states to describe in the waiver application
the processes they used to solicit input from the public, we will have
an appropriate oversight mechanism to review the integrity of the
process, while allowing states flexibility to implement public input
processes that make sense for the specific waiver and the state or are
required under state law. We will consider whether further guidance
along these lines would be helpful.
Comment: A commenter wanted CMS to clarify that the public input
process should apply to new waivers and not just existing waivers.
Response: We concur with this comment and clarified in the rule
that the public input process should be for both existing waivers that
have substantive changes proposed, either through the renewal or the
amendment process, and new waivers. We also clarified that the public
input process must be fully described in a state's waiver application.
Comment: Several other comments received went beyond the scope of
the regulation, such as asking for more transparency in negotiations
between CMS and states regarding review of waiver actions. Another
asked for an assurance that input gathered from the public should
influence change.
Response: The scope of the regulation was not intended to address
our review process and review criteria, which is addressed further in
the Instructions and Technical Guide for section 1915(c) HCBS waivers.
We believe that the regulation changes strengthen requirements for
states to solicit meaningful public input prior to waiver submissions
to CMS, which will help states in making decisions about the design and
operation of their waiver programs that benefit the populations to be
served.
Comment: Commenters noted CMS was not clear on whether there were
any differences between public input regarding rate changes and notice
for operations and service changes, as these two areas were described
separately in the proposed rule.
Response: Since there are already existing regulations that address
notice requirements to methods and standards of setting payment rates
across Medicaid authorities, we are reminding states of those
obligations with the rule. In addition, in this rule we are adding new
provisions regarding public notice for HCBS changes that are similar to
those for setting payment rates.
Comment: There were several themes among the many commenters who
agreed with the proposed language in the rule regarding public notice
and input. Commenters supported the requirement that state agencies
must provide public notice of any significant proposed change in their
methods and standards for setting payment rates for services. They also
appreciated the inclusion of stakeholders in the process. Commenters
expressed agreement with CMS that public input is important for waiver
development and that the input process must be accessible to the public
(including persons with disabilities), and a state must be required to
make efforts to ensure that those who want to participate can do so.
Response: We concur with these comments. We agree that the rule is
being changed to achieve the purposes outlined by those commenters who
support the proposed rule change.
c. Selecting Strategies To Ensure Compliance (Sec. 441.304(g))
In new paragraph, Sec. 441.304(g), we added language describing
additional strategies we may employ to ensure state compliance with the
requirements of a waiver, short of termination or non-renewal. Our
regulation at new Sec. 441.304(g) reflects an approach to encourage
state compliance. We are interested in working with states to achieve
full compliance without having to resort to termination of a waiver.
Therefore, we proposed strategies to ensure compliance in serious
situations short of termination. These strategies include use of a
moratorium on waiver enrollments or withholding federal payment for
waiver services or administration of waiver services in accordance with
the seriousness and nature of the state's noncompliance. These
strategies could continue, if necessary, as the Secretary determines
whether termination is warranted. Our primary objective is to use such
strategies rarely, only after other efforts to resolve issues to ensure
the health and welfare of individuals served or to resolve other
serious non-compliance issues have not succeeded.
Once CMS employs a strategy to ensure compliance, the state must
submit an acceptable corrective action plan in order to resolve all
areas of noncompliance. The corrective action plan must include detail
on the actions and timeframe the state will take to correct each area
of noncompliance, including necessary changes to the quality
improvement strategy and a detailed timeline for the completion and
implementation of corrective actions.
[[Page 3021]]
We will determine if the corrective action plan is acceptable.
We received 50 comments on Sec. 441.304(g) regarding the actions
we can take if a Medicaid agency is substantively out of compliance
with waiver requirements.
Comment: One commenter stated that they believed the standard audit
process was the best way to achieve compliance.
Response: Onsite visits and audits are a tool we utilize to ensure
states clearly understand our guidance and adhere to regulatory
requirements. After 30 years of running the section 1915(c) waiver
program, it has become clear that other methods are needed to ensure
the welfare of our beneficiaries.
Comment: Commenters stated their concern with the potential harm to
beneficiaries that could result from moratoria on waiver enrollments
and urged us to use the moratoria as a last resort.
Response: We understand the potential negative effects a moratorium
on waiver enrollments may have on beneficiaries. Opportunities exist,
such as technical assistance and corrective action plans, to assist a
state to achieve compliance without the use of a moratorium. We will
always be ready to assist states through these means before moving
forward with a moratorium. We also note that the main compliance tool
currently available to us, termination of the waiver, has the potential
to harm an even higher number of individuals needing HCBS.
Comment: Many commenters agreed with the use of withholding a
portion of federal payment.
Response: Certain tools, such as withholding a portion of federal
payment, will only be utilized when necessary and after most other
options have been exhausted. At this time, we believe we will see the
necessary results to be assured that the care of our beneficiaries is
foremost to states.
Comment: One commenter recommended transparency as to where
withheld funds will go and how these funds will be used.
Response: We are committed to transparency. We will release the
information we are legally allowed to make public.
Comment: One commenter suggested we clarify whether the opportunity
for a hearing will be afforded when a state disputes compliance rulings
similar to the processes and safeguards specified in part 430 subpart
D.
Response: We reiterate that these additional enforcement measures
are part of a broader array of approaches we may take to achieve and
maintain full compliance with the requirements specified in section
1915(c) of the Act, in addition to waiver termination. States will be
afforded an opportunity to appeal. The procedures specified in subpart
D of part 430 of this chapter are applicable to state requests for
hearings on all non-compliance actions, including terminations.
Comment: Many commenters wanted assurances from CMS that due
process procedure will be followed before a moratorium is set or funds
are withheld and that enforcements should be waiver specific.
Response: The tools discussed to ensure compliance will only be
utilized after we have tried several other remedies, including
technical assistance and action plans. We will provide states with a
written notice of the impending strategies to ensure compliance for a
waiver program. The notice of our intent to use strategies to ensure
compliance will include the nature of the noncompliance, the strategy
to be employed, the effective date of the compliance strategy, the
criteria for removing the compliance strategy and the opportunity for a
hearing as specified in subpart D of part 430.
Comment: One commenter suggested that CMS develop a way to cover
the cost of training while a state is under a compliance strategy.
Response: Compliance is a state's responsibility when accepting
federal financial funding. That funding may be used to ensure
compliance measures are in place.
Comment: One commenter expressed support for the use of compliance
strategies other than termination or nonrenewal.
Response: We agree that additional options for promoting and
ensuring state compliance with HCBS waiver requirements should be
available. We have therefore added the phrase ``or other actions as
determined by the Secretary as necessary to address non-compliance with
section 1915(c) of the Act'' to the regulation text.
IV. Provisions of the Final Regulations
A. 1915(k) Community First Choice and 1915(i) State Plan Home and
Community-Based Services
The provisions proposed as new subpart L, consisting of Sec.
441.650 through Sec. 441.677, added to part 441 will be codified as
subpart M, consisting of Sec. 441.700 through Sec. 441.745.
For the most part, this final rule incorporates the provisions of
the proposed rule. In response to comments as explained in the
responses in the above section, those provisions of this final rule
that differ from the proposed rule are as follows:
Under Sec. 430.25 (waivers of State plan requirements), we added
``and in a manner consistent with the interests of beneficiaries and
the objectives of the Medicaid program.'' This was language from the
preamble of the proposed rule, for which we received a comment
requesting that it also be incorporated into the text of the final
regulation.
In response to many comments received, and for the reasons provided
in the responses above for each specific provision, we revised and
added new language to Sec. 441.530(a), regarding home and community-
based setting requirements for 1915(k) and to Sec. 441.710(a),
regarding home and community-based setting requirements for 1915(i). In
addition to those specific provisions, we examined the overall themes
of the commentary received and our basis for the HCB settings
requirements as a whole. All of the overall ideas may be found within
the summary of comments and our responses in the above section, which
are organized by specific provisions of the proposed rules.
In Sec. 440.182(c)(8), which refers to conditions set forth at
Sec. 440.180 for persons with chronic mental illness, we have revised
this reference to Sec. 440.180(d)(2) to be more precise.
Under eligibility for home and community-based services under Sec.
441.710(d), we corrected the reference to target criteria from (b)(2)
to (e)(2).
Under Sec. 441.710(e)(2)(ii), we corrected the reference to Sec.
440.182(b) to Sec. 440.182(c).
We have corrected Sec. 441.715(b)(2) to replace the reference to
(c)(7) to instead specify (c)(6).
We have corrected Sec. 441.715(c) by replacing ``the Secretary
will approve'' with ``the Secretary may approve.''
We have corrected Sec. 441.715(d) to replace the reference to
section 441.710(a)(1) to Sec. 441.658.
In Sec. 441.715(d)(2), we have revised the reference to Sec.
441.656 so that it now reads correctly as a reference to Sec. 435.219
and Sec. 436.219.
At Sec. 441.720(a)(1), we made a minor correction and added a
cross reference after ``person-centered process'' to Sec. 441.725(a).
At Sec. 441.720(a)(1)(i)(A), we revised the language to be
consistent with other language in this regulation.
We added ``cognitive'' to Sec. 441.720(a)(4) in response to
comments received, to specifically include assessment of needs related
to cognitive impairment.
We have revised the first sentence of Sec. 441.720(a)(5).
In response to numerous comments received regarding the section
1915(i) of
[[Page 3022]]
the Act person-centered planning process and person-centered service
plan, and in order to align these requirements across sections 1915(c)
and 1915(i) of the Act HCBS, we have modified the requirements in Sec.
441.725 of this final rule. In addition, we examined the overall themes
of the commentary received. An explanation of changes to regulation as
a result of comments received may be found within the responses in the
section above.
In Sec. 441.730(c), we added ``cognitive'' and current knowledge
of ``available resources, service options, and providers'' to this
requirement.
We added a new statement to Sec. 441.735(a) regarding the
definition of individual's representative to indicate that in instances
where state law confers decision-making authority to the individual
representative, the individual will lead the service planning process
where possible and the individual representative will have a
participatory role, as needed and as defined by the individual.
We revised Sec. 441.735(c).
We revised Sec. 441.740(b)(4).
For clarity, we have moved the requirement regarding financial
management supports that was previously at both Sec. 441.674(c)(2) and
Sec. 441.674(d)(4) of the proposed rule, to a new (5) under Sec.
441.740(b) of this final rule.
We edited employer authority at Sec. 441.740(c) to ensure
consistency with statutory language, by replacing ``or'' with ``and''
so that it now reads as ``the ability to select, manage, and dismiss
providers of State plan HCBS.''
We revised Sec. 441.740(e)(3).
Since advance notice is a topic in part 431, subpart E, we have
added ``advance notice'' to the regulation at Sec. 441.745(a)(1)(iii).
We revised Sec. 441.745(a)(2)(vi) to specify that for renewal, the
state's 1915(i) benefit must meet the state's objectives with respect
to quality improvement and beneficiary outcomes.
We revised Sec. 441.745(b)(1)(ii) to add language that was in the
preamble of the proposed rule.
B. 1915(c) Home and Community Based Services Waivers
We have outlined in section III of this preamble the revisions in
response to the public comments. Those provisions of this final rule
that differ from the proposed rule are as follows:
Based upon the complexities of the comments received, we have
reorganized the regulations to finalize the provisions proposed at
Sec. 441.301(b)(1)(i)(A) through Sec. 441.301(b)(1)(i)(B)(12) as new
paragraph Sec. 441.301(c).
At Sec. 441.301(c)(1) and (2), we made some general revisions to
the terminology utilized to strengthen language regarding services. We
added the term ``supports'' when referencing services to now use the
language ``services and supports.'' We also revised person-centered
plan as ``person-centered service plan.''
At Sec. 441.301(c)(1)(i) we added language to more clearly define
the role of the individual's representative and refer to the 1915(i)
definition of the individual's representative at Sec. 441.735 in this
rule.
We have revised Sec. 441.301(c)(i)(ii) to more clearly state the
individual's role in directing the person-centered planning process.
We have revised Sec. 441.301(c)(1)(iii) to include a requirement
for timeliness.
We have revised Sec. 441.301(c)(1)(v) to strengthen this language
to direct that the state devise clear conflict-of-interest guidelines
addressed to all parties who participate in the person-centered
planning process.
We have added a new provision at Sec. 441.301(c)(1)(vi) to clarify
conflict of interest standards pertaining to providers of HCBS. The
proposed text at Sec. 441.301(b)(1)(i)(A)(6) through (8) all shifted
down by one number and are included in the final rule at Sec.
441.301(c)(1)(vii) through (ix).
We have revised Sec. 441.301(c)(1)(vii) to clarify that
individuals should be informed of all the possibilities from which they
may choose regarding services, as well as the consequences of these
choices.
We added a new provision at Sec. 441.301(c)(1)(ix) to clarify that
the setting in which an individual resides is an important part of the
person-centered planning process.
We have revised Sec. 441.301(c)(2) to align the language with
other HCBS authorities.
We have added a new provision at Sec. 441.301(c)(2)(i) to ensure
that the individual's choice of setting is documented in the person-
centered service plan. The proposed text at 441.301(b)(1)(i)(B)(1)
through (5) all shifted down by one number and is included in the final
rule at Sec. 441.301(c)(2)(ii) through (vi). In addition, we added
language to ensure community integration.
We have revised Sec. 441.301(c)(2)(iii) and (iv) to align the
language with other HCBS authorities.
We have revised Sec. 441.301(c)(2)(v) by adding further clarifying
language regarding ``natural supports.''
We have revised previously numbered Sec. 441.301(b)(1)(i)(B)(6) to
clarify privacy and control over personal information and have moved
this requirement to Sec. 441.301(c)(2)(ix).
We have revised Sec. 441.301(c)(2)(vi) to strengthen the language
regarding risks for individuals.
We removed Sec. 441.301(b)(1)(i)(B)(8) from the final rule because
this requirement is a part of the person-centered planning requirements
at Sec. 441.301(c)(1)(iii) and (vii).
We revised Sec. 441.301(c)(2)(xi) to provide clarifying language
regarding the requirement for self-direction of services.
We revised Sec. 441.301(c)(2)(xii) to replace the term ``care''
with the term ``services and supports.''
We added new language at Sec. 441.301(c)(2)(xiii) and at Sec.
441.301(c)(3) to align with other HCBS authorities.
We revised Sec. 441.301(c)(4) by replacing the language with new
standards for HCBS settings that are aligned with other HCBS
authorities.
We added a provision at Sec. 441.301(c)(5) to specify the settings
that are not home and community-based.
We added a new provision at Sec. 441.301(c)(6)to specify the
requirements for States to achieve compliance with the HCB settings
standards.
We revised Sec. 441.302(a)(4) to clarify the expectations that
each individual within a waiver, regardless of target group, has equal
access to the services necessary to meet their unique needs. In
addition, we made a technical correction by changing ``selects to
serve'' to ``elects to serve.''
We have added a new provision at Sec. 441.302(a)(4)(i) directing
states to annually report data in the quality section of the CMS-372
regarding serving multiple target groups in a single waiver to ensure
that a single target group is not being prioritized to the detriment of
other groups.
We revised Sec. 441.304(d)(1) to be more specific about the kind
of change that constitutes a ``substantive change'' regarding HCBS
waiver amendments.
We added a new provision at Sec. 441.304(f)(2) to strengthen the
public notice and input process by including a minimum time limit for
posting notice of changes.
We added a new provision at Sec. 441.304(f)(3) to clarify when the
public input process applies.
We revised Sec. 441.304(g)(3)(i) to clarify that additional
options for promoting and ensuring state compliance with
[[Page 3023]]
HCBS waiver requirements should be allowed.
V. Collection of Information Requirements
Under the Paperwork Reduction Act of 1995, we are required to
provide 60-day notice in the Federal Register and solicit public
comment before a collection of information requirement is submitted to
the Office of Management and Budget (OMB) for review and approval. In
order to fairly evaluate whether an information collection should be
approved by OMB, section 3506(c)(2)(A) of the Paperwork Reduction Act
of 1995 (PRA) requires that we solicit comment on the following issues:
The need for the information collection and its usefulness
in carrying out the proper functions of our agency.
The accuracy of our estimate of the information collection
burden.
The quality, utility, and clarity of the information to be
collected.
Recommendations to minimize the information collection
burden on the affected public, including automated collection
techniques.
We solicited public comment on each of these issues for the
following sections of this document that contain information collection
requirements:
ICRs Regarding Individuals Receiving State Plan Home and
Community-based Services (Sec. 435.219(b) and Sec. 436.219(b))
To cover the categorically needy eligibility group, the State would
be required to submit a SPA and may elect to cover individuals who meet
certain requirements in Sec. 435.219(a) or Sec. 436.219(a). The
burden associated with this requirement is the time and effort put
forth by the State to complete, review, process and transmit/submit the
pre-print which describes the eligibility criteria for the group. We
estimate it would take each State 30 hours to meet this one-time
requirement. We estimate that on an annual basis, 3 States will submit
a SPA to meet these requirements; therefore, the total annual burden
hours for this requirement are 90 hours. We believe that a State
employee, with pay equivalent to GS-13 step one ($34.34 per hour) would
be responsible for this requirement. Thus, the cost for each State is
anticipated to be $1,030; this equates to an annual cost of $3,091.
ICRs Regarding Eligibility for State Plan HCBS (Sec. 441.710)
(Proposed Sec. 441.656)
If a State elects to target the benefit to specific populations,
Sec. 441.710(e)(2) requires submission of targeting criteria to CMS.
The burden associated with this requirement is the time and effort put
forth by the State to establish such criteria. We estimate it would
take 1 State 10 hours to meet this one-time requirement. We estimate
that on an annual basis, 3 States will submit a SPA to offer the State
plan HCBS benefit that targets specific populations, and be affected by
this requirement; therefore, the total annual burden hours for this
requirement is 30 hours. We believe that a State employee, with pay
equivalent to GS-13 step one ($34.34 per hour) would be responsible for
this requirement. Thus, the cost for each State is anticipated to be
$343; this equates to an annual cost of $1,030.
ICRs Regarding Needs-Based Criteria and Evaluation Sec.
441.715 (Proposed Sec. 441.659)
Section 441.715(a) requires a State to establish needs-based
criteria for determining an individual's eligibility under the State
plan for the HCBS benefit, and may establish needs-based criteria for
each specific service. The burden associated with this requirement is
the time and effort put forth by the State to establish such criteria.
We estimate it would take 1 State 24 hours to meet this requirement. We
estimate that on an annual basis, 3 States will submit a SPA to offer
the State plan HCBS benefit, and be affected by this one-time
requirement; therefore, the total annual burden hours for this
requirement is 72 hours. We believe that a State employee, with pay
equivalent to GS-13 step one ($34.34 per hour) would be responsible for
this requirement. Thus, the cost for each responding State is
anticipated to be $824; this equates to an annual cost of $2,472.
Section 441.715(b) reads that if a State defines needs-based
criteria for individual State plan home and community-based services,
the needs-based institutional eligibility criteria must be more
stringent than the combined effect of needs-based State plan HCBS
benefit eligibility criteria and individual service criteria. Section
441.715(b)(1)(ii) requires the State to submit the more stringent
criteria to CMS for inspection with the State plan amendment that
establishes the State Plan HCBS benefit.
The burden associated with this requirement is the time and effort
for the State to define the more stringent criteria and submit it to
CMS along with the State plan amendment that establishes the HCBS
benefit. We anticipate 3 States would be affected by this requirement
on an annual basis and it would require 1 hour to prepare and submit
this information. The one-time burden associated with this requirement
is 3 hours. We believe that a State employee, with pay equivalent to
GS-13 step one ($34.34 per hour) would be responsible for this
requirement. Thus, the cost for each State is anticipated to be $34;
this equates to an annual cost of $102. This would be a one-time burden
for each responding State.
Section 441.715(c) reads that a state may modify the needs-based
criteria established under paragraph (a) of this section, without prior
approval from the Secretary, if the number of individuals enrolled in
the state plan HCBS benefit exceeds the projected number submitted
annually to CMS.
Section 441.715(c)(1) requires the state to provide at least 60
days notice of the proposed modification to the Secretary, the public,
and each individual enrolled in the State plan HCBS benefit. The State
notice to the Secretary will be considered an amendment to the State
plan.
Section 441.715(c)(2) requires the State notice to the Secretary be
submitted as an amendment to the State plan.
The burden associated with the requirements found under Sec.
441.715(c) is the time and effort put forth by the State to modify the
needs-based criteria and provide notification of the proposed
modification to the Secretary. We estimate it would take 1 State 24
hours to make the modifications and provide notification. This would be
a one-time burden.
The total annual burden of these requirements (Sec. 441.715(c),
Sec. 441.715(c)(1), and Sec. 441.715(c)(2)) would vary according to
the number of States who choose to modify their needs-based criteria.
We do not expect any States to make this modification in the next 3
years, thus there is no anticipated burden.
Section 441.715(d) states that eligibility for the State plan HCBS
benefit is determined, for individuals who meet the requirements of
Sec. 441.710(a)(1) through (5), through an independent evaluation of
each individual that meets the specified requirements. Section
441.715(d)(5) requires the evaluator to obtain information from
existing records, and when documentation is not current and accurate,
obtain any additional information necessary to draw a valid conclusion
about the individual's support needs. Section 441.715(e) requires at
least annual reevaluations.
The burden associated with this requirement is the time and effort
put forth by the evaluator to obtain information to support their
conclusion. We estimate it would take one evaluator 2 hours per
participant to obtain
[[Page 3024]]
information as necessary. The total annual burden of this requirement
would vary according to the number of participants in each State who
may require and be eligible for HCBS under the State plan. The
individuals performing this assessment would vary based upon State
benefit design, but will likely include individuals such as registered
nurses, qualified developmental disability professionals, qualified
mental health professionals, case managers, or other professional staff
with experience providing services to individuals with disabilities or
the elderly. While there is burden associated with this requirement, we
believe the burden is exempt as defined in 5 CFR 1320.3(b)(2) because
the time, effort, and financial resources necessary to comply with this
requirement would be incurred by persons in the normal course of their
activities.
ICRs Regarding Independent Assessments Sec. 441.720 (Proposed
Sec. 441.662)
Section 441.720 requires the State to provide for an independent
assessment of need in order to establish a person-centered service
plan. At a minimum, the person-centered service plan must meet the
requirements as discussed under Sec. 441.725.
While the burden associated with the requirements under Sec.
441.720 is subject to the PRA, we believe the burden is exempt as
defined in 5 CFR 1320.3(b)(2) because the time, effort, and financial
resources necessary to comply with this requirement would be incurred
by persons in the normal course of their activities.
ICRs Regarding State Plan HCBS Administration: State
Responsibilities and Quality Improvement Sec. 441.745 (Proposed Sec.
441.677)
Section 441.745(a)(1)(i) reads that a State will annually provide
CMS with the projected number of individuals to be enrolled in the
benefit, and the actual number of unduplicated individuals enrolled in
State plan HCBS in the previous year.
The burden associated with this requirement is the time and effort
put forth by the state to annually project the number of individuals
who will enroll in State plan HCBS. We estimate it will take one state
2 hours to meet this requirement. The total annual burden of these
requirements would vary according to the number of States offering the
State plan HCBS benefit. The maximum total annual burden is 112 hours
(56 States x 2 hours = 112 hours). We believe that a state employee,
with pay equivalent to GS-13 step one ($34.34 per hour) would be
responsible for this requirement. Thus, the anticipated for each state
is anticipated to be $69; this equates to a maximum annual cost of
$3,864 if all 56 states elect to provide this benefit. There are
currently six states with approved State plan HCBS benefits. Thus, we
anticipate based on current benefits that the total annual aggregated
burden will be $414.
Section 441.745(a)(2)(iii) reads that the SPA to provide State plan
HCBS must contain a description of the reimbursement methodology for
each covered service.
The burden associated with this requirement is the time and effort
put forth by the state to describe the reimbursement methodology for
each State plan HCBS. We estimate that it will take one state an
average of 2 hours to determine the reimbursement methodology for one
covered HCBS. This would be a one-time burden. The total annual burden
for this requirement would vary according to the number of services
that the state chooses to include in the state plan HCBS benefit. We
believe that a state employee, with pay equivalent to GS-13 step one
($34.34 per hour) would be responsible for this requirement. Thus, the
cost to each state for each covered service is anticipated to be $69;
this would vary based upon the number of services covered. This would
be an annual burden for each responding state. Since we have estimated
that 3 states will annually describe the reimbursement methodology, the
total annual aggregated burden associated with this requirement is
estimated to be $207.
Section 441.745(a)(2)(iv) reads that the SPA to provide State plan
HCBS must contain a description of the State Medicaid agency line of
authority for operating the State plan HCBS benefit, including
distribution of functions to other entities.
The burden associated with this requirement is the time and effort
put forth by the state to describe the State Medicaid agency line of
authority. We estimate it will take one state 2 hours to meet this
requirement. Since we have estimated that 3 states will annually
request State plan HCBS, the total annual burden associated with this
requirement is estimated to be 6 hours. This would be a one-time burden
for each responding state. We believe that a state employee, with pay
equivalent to GS-13 step one ($34.34 per hour) would be responsible for
this requirement. Thus, the cost for each State is anticipated to be
$69.
Section 441.745(a)(2)(vi) limits the approval period for states
that target the benefit to specific populations. If a state elects to
target the benefit, this section requires a renewal application every 5
years in order to continue operation of the benefit. Actual time to
meet this requirement will vary depending on the scope of the program
and any changes the state includes. However, we estimate that it will
take one state an average of 40 hours to meet this requirement. This
includes reviewing the previous submission, making any necessary
changes to the state plan document(s), and communicating with CMS
regarding the renewal. This burden would occur once every five years
and would be recurring. We estimate that, beginning in 2016, 3 states
will annually request renewal and the total burden will be 120 hours.
We believe that a state employee, with pay equivalent to GS-13 step one
($34.34 per hour) would be responsible for this requirement. Thus, the
cost for each State is anticipated to be $1,374; this equates to an
annual cost of $4,122. This would be a burden for each State that
targets its benefit once every 5 years; however, this burden will not
take effect until 2016.
Section 441.745(b) requires States to develop and implement a
quality improvement strategy that includes methods for ongoing
measurement of program performance, quality of care, and mechanisms for
remediation and improvement proportionate to the scope of services in
the State plan HCBS benefit and the number of individuals to be served,
and make this information available to CMS upon the frequency
determined by the Secretary or upon request.
The burden associated with this requirement is the time and effort
put forth by the state to develop and implement a quality improvement
strategy, and to make this information available to CMS upon the
frequency determined by the Secretary or upon request. We estimate it
will take one state 45 hours for the development of the strategy, and
for making information available to CMS. The total annual burden of
these requirements would vary according to the number of states
offering the state plan HCBS benefit. The maximum total annual burden
is estimated to be 2,520 hours (56 states x 45 hours = 2,520 hours). We
estimate that the burden associated with implementation of the quality
improvement strategy will greatly vary, as the necessary time and
effort to perform these activities is dependent upon the scope of the
benefit and the number of persons receiving state plan HCBS. We believe
that a state employee, with pay equivalent to GS-13 step one ($34.34
per hour) would be responsible
[[Page 3025]]
for this requirement. Thus, the cost for each State is anticipated to
be $1,545; this equates to a maximum annual cost of $86,537. Currently,
there are 6 states with approved benefits, thus we anticipate an annual
burden based on current States of $9,270.
Table 1--Annual Recordkeeping and Reporting Requirements
--------------------------------------------------------------------------------------------------------------------------------------------------------
Hourly
Burden per Total labor cost Total labor Total
Regulation section(s) OMB Control Respondents Responses response annual of cost of capital/ Total
No. (hours) burden reporting reporting maintenance cost ($)
(hours) ($) ($) costs ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
435.219(b) and 436.219(b)........... 0938-1148 3 3 30 90 34.34 1,030 0 1,030
441.656(e)(2) of proposed rule; 0938-1148 3 3 10 30 34.34 1,030 0 1,030
441.710(e)(2) of final rule........
441.659(a) of proposed rule; 0938-1148 3 3 24 72 34.34 2,472 0 2,472
441.715(a) of final rule...........
441.659(b) of proposed rule; 0938-1148 3 3 1 3 34.34 103 0 103
441.715(b) of final rule...........
441.677(a)(1)(i) of proposed rule; 0938-1148 6 6 2 12 34.34 414 0 414
441.745 (a)(1)(i) of final rule....
441.677(a)(2)(iii) of proposed rule; 0938-1148 3 3 2 6 34.34 207 0 207
441.745 (a)(2)(iii) of final rule..
441.677(a)(2)(iv) of proposed rule; 0938-1148 3 3 2 6 34.34 207 0 207
441.745(a)(2)(iv) of final rule....
441.677(b) of proposed rule; 441.745 0938-1148 6 6 45 270 34.34 9,270 0 9,270
of final rule......................
------------------------------------------------------------------------------------------------------
Total........................... ........... .............. ........... ........... 489 ........... 14,733 0 14,733
--------------------------------------------------------------------------------------------------------------------------------------------------------
VI. Regulatory Impact Analysis
A. Statement of Need
The state plan HCBS benefit is authorized under section 1915(i) of
the Act. Section 1915(i) was created by the Deficit Reduction Act of
2005 (DRA) and was amended by the Affordable Care Act of 2010. The
resulting statute provides states with authority to establish state
plan HCBS benefits in their Medicaid program.
These regulations are necessary in order to include the state plan
HCBS within the Code of Federal Regulations (CFR). Additionally, these
regulations provide states with direction and clarity regarding the
framework under which the programs can be established.
B. Overall Impact
We have examined the impacts of this rule as required by Executive
Order 12866 on Regulatory Planning and Review (September 30, 1993) and
Executive 13563 on Improving Regulation and Regulatory Review (January
18, 2011), the Regulatory Flexibility Act (RFA) (September 19, 1980,
Pub. L. 96-354), section 1102(b) of the Social Security Act, section
202 of the Unfunded Mandates Reform Act of 1995 (March 22, 1995; Pub.
L. 104-4), Executive Order 13132 on Federalism (August 4, 1999) and the
Congressional Review Act (5 U.S.C. 804(2).
Executive Orders 12866 and 13563 direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). Executive
Order 13563 emphasizes the importance of quantifying both costs and
benefits, of reducing costs, of harmonizing rules, and of promoting
flexibility. A regulatory impact analysis (RIA) must be prepared for
major rules with economically significant effects ($100 million or more
in any one year). This final rule has been designated an ``economically
significant'' rule under section 3(f)(1) of Executive Order 12866.
Accordingly, the rule has been reviewed by the Office of Management and
Budget.
C. Overall Impacts
We estimate that, as a result of this final rule, the Medicaid cost
impact for provisions under 1915(i) for fiscal year (FY) 2014 will be
$150 million for the federal share and $115 million for the state
share. The estimates are adjusted for a phase-in period during which
states gradually elected to offer the state plan HCBS benefit.
Furthermore, the estimated total annual collection of information
requirements cost (including fringe benefits and overhead) to states is
$21,805 (see section V. Collection of Information Requirements).
Provisions in this rule pertaining to section 2601 of the
Affordable Care Act: 5-Year Period for Demonstration Projects
(Waivers), Provider Payment Reassignments, section 2401 of the
Affordable Care Act: 1915(k) Community First Choice State Plan Option:
Home and Community-Based Setting Requirements, and 1915(c) Home and
Community-Based Services Waivers will not impact federal or state
Medicaid funding. While States may incur costs in coming into
compliance with these provisions in this rule, given the variability in
State programs, and the varying extent to which some are already
complying, it is difficult to estimate these costs.
D. Detailed Impacts
1. State Plan HCBS
State Medicaid programs will make use of the optional flexibility
afforded by the state plan HCBS benefit to provide needed long-term
care HCBS to eligible individuals the state has not had means to serve
previously, or to provide services to these individuals more
efficiently and effectively. The state plan HCBS benefit will afford
states a new means to comply with requirements of the Olmstead
decision, to serve individuals in the most integrated setting.
The cost of these services will be dependent upon the number of
states electing to offer the benefit, the scope of the benefits states
design, and the degree to which the benefits replace existing Medicaid
services. States have more control over expenditures for this benefit
than over other state plan services. For states that choose to offer
these services, states may specify limits to the scope of HCBS, target
the benefit to specific populations, and have the option to adjust
needs-based criteria
[[Page 3026]]
requirements if costs escalate too rapidly.
If states elect to include the new optional group, eligibility
could be expanded because the group may include individuals who would
not otherwise be eligible for Medicaid. However, costs of the state
plan HCBS benefit may be offset by lowered potential federal and state
costs of more expensive institutional care. Additionally, the
requirement for a written person-centered service plan, and the
provision of needed HCBS in accordance with the person-centered service
plan, may discourage inappropriate utilization of costly services such
as emergency room care for routine procedures, which may be beneficial
to Medicare and Medicaid when individuals are eligible for both
programs. If a state targets this benefit, only individuals who meet
the targeting criteria would receive 1915(i) services and be eligible
for the group, thus limiting Medicaid HCBS expansion.
After considering these factors, we assumed that, if all states
adopted this measure, program expenditures would increase by 1 percent
of current HCBS expenditure projections. We further assumed that
ultimately, states representing 50 percent of the eligible population
would elect to offer this benefit, and that this ultimate level would
be reached in FY 2014,. Based on these assumptions, the federal and
state cost estimates are shown in Table 2.
Table 2--Medicaid Cost Estimates Resulting From Changes to the State Plan HCBS Benefit
[FYs 2014-2018, in $millions]
----------------------------------------------------------------------------------------------------------------
FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FYs 2014-2018
----------------------------------------------------------------------------------------------------------------
Federal Share................ $150 $165 $185 $200 $225 $925
State Share.................. 115 125 140 155 170 705
----------------------------------------------------------------------------------
Total.................... 265 290 325 355 395 1,630
----------------------------------------------------------------------------------------------------------------
The effect on Medicaid beneficiaries who receive the state plan
HCBS benefit will be substantial and beneficial in States where
optional 1915(i) state plan HCBS are included, as it will provide
eligible individuals with the opportunity to receive needed long-term
care services and supports in their homes and communities.
The state plan HCBS benefit will afford business opportunities for
providers of the HCBS. We do not anticipate any effects on other
providers. Section 1915(i) of the Act delinks the HCBS from
institutional LOC, and requires that eligibility criteria for the
benefit include a threshold of need less than that for institutional
LOC, so that it is unlikely that large numbers of participants in the
state plan HCBS benefit will be discharged from the facilities of
Medicaid institutional providers. There may be some redistribution of
services among providers of existing non-institutional Medicaid
services into State plan HCBS, but providers who meet qualifications
for the state plan HCBS benefit have the option to enroll as providers
of HCBS.
This rule has no direct effect on the Medicare program; however, an
indirect and beneficial effect may occur if individuals eligible for
both Medicare and Medicaid are enrolled in a state plan HCBS benefit.
E. Alternatives Considered
This final rule incorporates provisions of new section 1915(i) of
the Act into federal regulations, providing for Medicaid coverage of a
new optional state plan benefit to furnish home and community-based
state plan services. The statute provides states with an option under
which to draw federal matching funds; it does not impose any
requirements or costs on existing state programs, on providers, or upon
beneficiaries. States retain their authority to offer HCBS through the
existing authority granted under section 1915(c) waivers and under
section 1115 waivers. States can also continue to offer, and
individuals can choose to receive, some but not all components of HCBS
allowable under section 1915(i) through existing state plan services
such as personal care or targeted case management services.
1. Not Publishing a Rule
Section 1915(i) of the Act was effective January 1, 2007. States
may propose state plan amendments (SPAs) to establish the state plan
HCBS benefit with or without this final rule. We considered whether
this statute could be self-implementing and require no regulation.
Section 1915(i) of the Act is complex; many states have contacted us
for technical assistance in the absence of published guidance, and some
have indicated they are waiting to submit a state plan amendment until
there is a rule. We further considered whether a State Medicaid
Director letter would provide sufficient guidance regarding CMS review
criteria for approval of an SPA. We concluded that section 1915(i) of
the Act establishes significant new features in the Medicaid program,
and that it was important to provide states and the public the
published invitation for comment provided by the proposed rule.
Finally, state legislation and judicial decisions are not alternatives
to a federal rule in this case since section 1915(i) of the Act
provides federally funded benefits.
2. Modification of Existing Rules
We considered modifying existing regulations at Sec. 440.180, part
441 subpart G, Home and Community-Based Services: Waiver Requirements,
which implement the section 1915(c) HCBS waivers, to include the
authority to offer the state plan HCBS benefit. This would have the
advantage of not duplicating certain requirements common to both types
of HCBS. However, we believe that any such efficiency would be
outweighed by the substantial discussion that would be required of the
differences between the Secretary's discretion to approve waivers under
section 1915(c) of the Act, and authority to offer HCBS under the State
plan at section 1915(i) of the Act. While Congress clearly considered
the experience to date with HCBS under waivers when constructing
section 1915(i) of the Act, it did not choose to modify section 1915(c)
of the Act, but chose instead to create a new authority at section
1915(i) of the Act.
F. Accounting Statement
As required by OMB Circular A-4 (available at https://www.whitehouse.gov/omb/circulars_a004_a-4), in the Table 3, we have
prepared an accounting statement showing the classification of the
transfers and other impacts associated with the provisions of this
final rule. This table provides our best estimate of the increase in
aggregate Medicaid outlays resulting from offering states the option to
provide the state plan HCBS
[[Page 3027]]
benefit established in section 1915(i) of the Act.
Table 3--Accounting Statement: Classification of Estimated Transfers and
Other Impacts, From FYs 2014 to 2018
[In $millions] a
------------------------------------------------------------------------
------------------------------------------------------------------------
Category Transfers
------------------------------------------------------------------------
Annualized Monetized Transfers.. 3% Units Discount 7% Units Discount
Rate $183.5. Rate $182.1
------------------------------------------------------------------------
From Whom To Whom?.............. Federal Government to Beneficiaries
and/or State Governments b
------------------------------------------------------------------------
Category Transfers
------------------------------------------------------------------------
Other Annualized Monetized 3% Units Discount 7% Units Discount
Transfers. Rate $138.6. Rate $137.5
------------------------------------------------------------------------
From Whom To Whom?.............. State Governments to Beneficiaries and/
or State Governments b
------------------------------------------------------------------------
Category Costs
------------------------------------------------------------------------
Total Annual Collection of Information Requirements Cost to States is
$0.02.
------------------------------------------------------------------------
a The potential benefits of this rule have not been quantified. If
beneficiaries who newly use HCBS as a result of this rule are
currently being institutionalized at states' expense, the rule would
generate some combination of savings to states (equal to the cost
difference between institutionalization and HCBS) and benefits to
beneficiaries of being at home or in some other setting in the
community, rather than an institution. Similarly, there would be
benefits to beneficiaries who newly use HCBS if they are currently not
receiving needed services.
b If the current status is that beneficiaries are paying for services
alternative to HCBS themselves, then transfers are flowing from
federal and state governments to beneficiaries. If beneficiaries are
currently being institutionalized at states' expense, then transfers
are from the federal government to state governments and possibly
between pools of money within a state--from one pool with inflexible
spending rules that require institutional care to another pool that
allows for HCBS. Finally, to the extent that beneficiaries are
currently not receiving needed services, then some portion of the
impacts currently categorized as ``transfers'' would actually be
societal costs.
G. Conclusion
We anticipate that states will make widely varying use of the
section 1915(i) state plan HCBS benefit to provide needed long-term
care services for Medicaid beneficiaries. These services will be
provided in the home or alternative living arrangements in the
community, which is of benefit to the beneficiary and is less costly
than institutional care. Requirements for independent evaluation and
assessment, individualized care planning, and requirements for a
quality improvement program will promote efficient and effective use of
Medicaid expenditures for these services.
VII. Regulatory Flexibility Act Analysis
The Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L.
96-354), as modified by the Small Business Regulatory Enforcement
Fairness Act of 1996 (SBREFA) (Pub. L. 104-121), requires agencies to
analyze options for regulatory relief of small entities, if a rule has
a significant impact on a substantial number of small entities. For
purposes of the RFA, small entities include small businesses, nonprofit
organizations, and small governmental jurisdictions. Most hospitals and
most other providers and suppliers are small entities, either by
nonprofit status or by having revenues of less than $7.0 million to
$34.5 million in any 1 year. Medicaid providers are required, as a
matter of course, to follow the guidelines and procedures as specified
in state and federal laws and regulations. Furthermore, this final rule
imposes no requirements or costs on providers or suppliers for their
existing activities. The rule implements a new optional state plan
benefit established in section 1915(i) of the Act. Small entities that
meet provider qualifications and choose to provide HCBS under the state
plan will have a business opportunity under this final rule. The
Secretary has determined that this final rule will not have a
significant economic impact on a substantial number of small entities.
In addition, section 1102(b) of the Act requires us to prepare a
regulatory impact analysis if a rule may have a significant impact on
the operations of a substantial number of small rural hospitals. This
analysis must conform to the provisions of section 604 of the RFA. For
purposes of section 1102(b) of the Act, we define a small rural
hospital as a hospital that is located outside of a metropolitan
statistical area and has fewer than 100 beds. This final rule does not
offer a change in the administration of the provisions related to small
rural hospitals. Therefore, the Secretary has determined that this
final rule will not have a significant impact on the operations of a
substantial number of small rural hospitals.
VIII. Unfunded Mandates Reform Act Analysis
Section 202 of the Unfunded Mandates Reform Act of 1995 (March 22,
1995, Pub. L. 104-4) requires that agencies assess anticipated costs
and benefits before issuing any rule whose mandates require spending in
any 1 year of $100 million in 1995 dollars, updated annually for
inflation. In 2013, that threshold is approximately $141 million. This
final rule does not mandate any spending by state, local, or tribal
governments, in the aggregate, or by the private sector, of $141
million.
IX. Federalism Analysis
Executive Order 13132 on Federalism (August 4, 1999) establishes
certain requirements that an agency must meet when it promulgates a
proposed rule (and subsequent final rule) that imposes substantial
direct requirement costs on state and local governments, preempts state
law, or otherwise has federalism implications. Since this regulation
does not impose any costs on state or local governments, the
requirements of E.O. 13132 are not applicable.
List of Subjects
42 CFR Part 430
Administrative practice and procedure, Grant programs-health,
Medicaid, Reporting and recordkeeping requirements.
[[Page 3028]]
42 CFR Part 431
Grant programs-health, Health facilities, Medicaid, Privacy,
Reporting and recordkeeping requirements.
42 CFR Part 435
Aid to Families With Dependent Children, Grant programs-health,
Medicaid, Reporting and recordkeeping requirements, Supplemental
Security Income, Wages.
42 CFR Part 436
Aid to Families With Dependent Children, Grant programs-health,
Guam, Medicaid, Puerto Rico, Supplemental Security Income (SSI), Virgin
Islands.
42 CFR Part 440
Grant programs-health, Medicaid.
42 CFR Part 441
Aged, Family planning, Grant programs-health, Infants and children,
Medicaid, Penalties, Reporting and recordkeeping requirements.
42 CFR Part 447
Accounting, Administrative practice and procedure, Drugs, Grant
programs-health, Health facilities, Health professions, Medicaid,
Reporting and recordkeeping requirements, Rural areas.
For the reasons set forth in the preamble, the Centers for Medicare
& Medicaid Services amends 42 CFR chapter IV as set forth below:
PART 430--GRANTS TO STATES FOR MEDICAL ASSISTANCE PROGRAMS
0
1. The authority citation for part 430 continues to read as follows:
Authority: Sec. 1102 of the Social Security Act (42 U.S.C.
1302).
0
2. Section 430.25 is amended by revising paragraphs (h)(2) to read as
follows:
Sec. 430.25 Waivers of State plan requirements.
* * * * *
(h) * * *
(2) Duration of waivers. (i) Home and community-based services
under section 1915(c) of the Act.
(A) The initial waiver is for a period of 3 years and may be
renewed thereafter for periods of 5 years.
(B) For waivers that include individuals who are dually eligible
for Medicare and Medicaid, 5-year initial approval periods may be
granted at the discretion of the Secretary for waivers meeting all
necessary programmatic, financial and quality requirements, and in a
manner consistent with the interests of beneficiaries and the
objectives of the Medicaid program.
(ii) Waivers under section 1915(b) of the Act.
(A) The initial waiver is for a period of 2 years and may be
renewed for additional periods of up to 2 years as determined by the
Administrator.
(B) For waivers that include individuals who are dually eligible
for Medicare and Medicaid, 5-year initial and renewal approval periods
may be granted at the discretion of the Secretary for waivers meeting
all necessary programmatic, financial and quality requirements, and in
a manner consistent with the interests of beneficiaries and the
objectives of the Medicaid program.
(iii) Waivers under section 1916 of the Act. The initial waiver is
for a period of 2 years and may be renewed for additional periods of up
to 2 years as determined by the Administrator.
* * * * *
PART 431--STATE ORGANIZATION AND GENERAL ADMINISTRATION
0
3. The authority citation for part 431 continues to read as follows:
Authority: Sec. 1102 of the Social Security Act (42 U.S.C.
1302).
0
4. Section 431.54 is amended by adding new paragraphs (a)(3) and (h) to
read as follows:
Sec. 431.54 Exceptions to certain State plan requirements .
(a) * * *
(3) Section 1915(i) of the Act provides that a State may provide,
as medical assistance, home and community-based services under an
approved State plan amendment that meets certain requirements, without
regard to the requirements of sections 1902(a)(10)(B) and
1902(a)(10)(C)(i)(III) of the Act, with respect to such services.
* * * * *
(h) State plan home and community-based services. The requirements
of Sec. 440.240 of this chapter related to comparability of services
do not apply with respect to State plan home and community-based
services defined in Sec. 440.182 of this chapter.
PART 435--ELIGIBILITY IN THE STATES, DISTRICT OF COLUMBIA, THE
NORTHERN MARIANA ISLANDS, AND AMERICAN SAMOA
0
5. The authority citation for part 435 continues to read as follows:
Authority: Sec. 1102 of the Social Security Act (42 U.S.C.
1302).
0
6. Section 435.219 is added to subpart C under the undesignated center
heading ``Options for Coverage of Families and Children and the Aged,
Blind, and Disabled'' to read as follows:
Sec. 435.219 Individuals receiving State plan home and community-
based services.
If the agency provides State plan home and community-based services
to individuals described in section 1915(i)(1), the agency, under its
State plan, may, in addition, provide Medicaid to individuals in the
community who are described in one or both of paragraphs (a) or (b) of
this section.
(a) Individuals who--
(1) Are not otherwise eligible for Medicaid;
(2) Have income that does not exceed 150 percent of the Federal
poverty line (FPL);
(3) Meet the needs-based criteria under Sec. 441.715 of this
chapter; and
(4) Will receive State plan home and community-based services as
defined in Sec. 440.182 of this chapter.
(b) Individuals who--
(1) Would be determined eligible by the agency under an existing
waiver or demonstration project under sections 1915(c), 1915(d),
1915(e) or 1115 of the Act, but are not required to receive services
under such waivers or demonstration projects;
(2) Have income that does not exceed 300 percent of the
Supplemental Security Income Federal Benefit Rate (SSI/FBR); and
(3) Will receive State plan home and community-based services as
defined in Sec. 440.182 of this chapter.
(c) For purposes of determining eligibility under paragraph (a) of
this section, the agency may not take into account an individual's
resources and must use income standards that are reasonable, consistent
with the objectives of the Medicaid program, simple to administer, and
in the best interests of the beneficiary. Income methodologies may
include use of existing income methodologies, such as the SSI program
rules. However, subject to the Secretary's approval, the agency may use
other income methodologies that meet the requirements of this
paragraph.
PART 436--ELIGIBILITY IN GUAM, PUERTO RICO AND THE VIRGIN ISLANDS
0
7. The authority citation for part 436 continues to read as follows:
Authority: Sec. 1102 of the Social Security Act (42 U.S.C.
1302).
[[Page 3029]]
0
8. Section 436.219 is added to read as follows:
Sec. 436.219 Individuals receiving State plan home and community-
based services.
If the agency provides State plan home and community-based services
to individuals described in section 1915(i)(1) of the Act, the agency,
under its State plan, may, in addition, provide Medicaid to of
individuals in the community who are described in one or both of
paragraphs (a) or (b) of this section.
(a) Individuals who--
(1) Are not otherwise eligible for Medicaid;
(2) Have income that does not exceed 150 percent of the Federal
poverty line (FPL);
(3) Meet the needs-based criteria under Sec. 441.715 of this
chapter; and
(4) Will receive State plan home and community-based services as
defined in Sec. 440.182 of this chapter.
(b) Individuals who--
(1) Would be determined eligible by the agency under an existing
waiver or demonstration project under sections 1915(c), 1915(d),
1915(e) or 1115 of the Act, but are not required to receive services
under such waivers or demonstration projects;
(2) Have income that does not exceed 300 percent of the
Supplemental Security Income Federal Benefit Rate (SSI/FBR); and
(3) Will receive State plan home and community-based services as
defined in Sec. 440.182 of this chapter.
(c) For purposes of determining eligibility under paragraph (a) of
this section, the agency may not take into account an individual's
resources and must use income standards that are reasonable, consistent
with the objectives of the Medicaid program, simple to administer, and
in the best interests of the beneficiary. Income methodologies may
include use of existing income methodologies, such as the rules of the
OAA, AB, APTD or AABD programs. However, subject to the Secretary's
approval, the agency may use other income methodologies that meet the
requirements of this paragraph.
PART 440--SERVICES: GENERAL PROVISIONS
0
9. The authority citation for part 440 continues to read as follows:
Authority: Sec. 1102 of the Social Security Act (42 U.S.C.
1302).
0
10. Section 440.1 is amended by adding the new statutory basis 1915(i)
in sequential order to read as follows:
Sec. 440.1 Basis and purpose.
* * * * *
1915(i) Home and community-based services furnished under a State
plan to elderly and disabled individuals.
0
11. Section 440.180 is amended by revising the section heading to read
as follows:
Sec. 440.180 Home and community-based waiver services.
* * * * *
0
12. Section 440.182 is added to read as follows:
Sec. 440.182 State plan home and community-based services.
(a) Definition. State plan home and community-based services (HCBS)
benefit means the services listed in paragraph (c) of this section when
provided under the State's plan (rather than through an HCBS waiver
program) for individuals described in paragraph (b) of this section.
(b) State plan HCBS coverage. State plan HCBS can be made available
to individuals who--
(1) Are eligible under the State plan and have income, calculated
using the otherwise applicable rules, including any less restrictive
income disregards used by the State for that group under section
1902(r)(2) of the Act, that does not exceed 150 percent of the Federal
Poverty Line (FPL); and
(2) In addition to the individuals described in paragraph (b)(1) of
this section, to individuals based on the State's election of the
eligibility groups described in Sec. 435.219(b) or Sec. 436.219(b) of
this chapter.
(c) Services. The State plan HCBS benefit consists of one or more
of the following services:
(1) Case management services.
(2) Homemaker services.
(3) Home health aide services.
(4) Personal care services.
(5) Adult day health services.
(6) Habilitation services, which include expanded habilitation
services as specified in Sec. 440.180(c).
(7) Respite care services.
(8) Subject to the conditions in Sec. 440.180(d)(2), for
individuals with chronic mental illness:
(i) Day treatment or other partial hospitalization services;
(ii) Psychosocial rehabilitation services;
(iii) Clinic services (whether or not furnished in a facility).
(9) Other services requested by the agency and approved by the
Secretary as consistent with the purpose of the benefit.
(d) Exclusion. FFP is not available for the cost of room and board
in State plan HCBS. The following HCBS costs are not considered room or
board for purposes of this exclusion:
(1) The cost of temporary food and shelter provided as an integral
part of respite care services in a facility approved by the State.
(2) Meals provided as an integral component of a program of adult
day health services or another service and consistent with standard
procedures in the State for such a program.
(3) A portion of the rent and food costs that may be reasonably
attributed to an unrelated caregiver providing State plan HCBS who is
residing in the same household with the recipient, but not if the
recipient is living in the home of the caregiver or in a residence that
is owned or leased by the caregiver.
PART 441--SERVICES: REQUIREMENTS AND LIMITS APPLICABLE TO SPECIFIC
SERVICES
0
13. The authority citation for part 441 continues to read as follows:
Authority: Sec. 1102 of the Social Security Act (42 U.S.C.
1302).
0
14. Section 441.301 is amended by revising paragraphs (b)(1)(i) and
(b)(6) and adding paragraph (c) to read as follows:
Sec. 441.301 Contents of request for a waiver.
* * * * *
(b) * * *
(1) * * *
(i) Under a written person-centered service plan (also called plan
of care) that is based on a person-centered approach and is subject to
approval by the Medicaid agency.
* * * * *
(6) Be limited to one or more of the following target groups or any
subgroup thereof that the State may define:
(i) Aged or disabled, or both.
(ii) Individuals with Intellectual or Developmental Disabilities,
or both.
(iii) Mentally ill.
(c) A waiver request under this subpart must include the
following--
(1) Person-Centered Planning Process. The individual will lead the
person-centered planning process where possible. The individual's
representative should have a participatory role, as needed and as
defined by the individual, unless State law confers decision-making
authority to the legal representative. All references to individuals
include the role of the individual's representative. In addition to
being led by the individual receiving services and supports, the
person-centered planning process:
[[Page 3030]]
(i) Includes people chosen by the individual.
(ii) Provides necessary information and support to ensure that the
individual directs the process to the maximum extent possible, and is
enabled to make informed choices and decisions.
(iii) Is timely and occurs at times and locations of convenience to
the individual.
(iv) Reflects cultural considerations of the individual and is
conducted by providing information in plain language and in a manner
that is accessible to individuals with disabilities and persons who are
limited English proficient, consistent with Sec. 435.905(b) of this
chapter.
(v) Includes strategies for solving conflict or disagreement within
the process, including clear conflict-of-interest guidelines for all
planning participants.
(vi) Providers of HCBS for the individual, or those who have an
interest in or are employed by a provider of HCBS for the individual
must not provide case management or develop the person-centered service
plan, except when the State demonstrates that the only willing and
qualified entity to provide case management and/or develop person-
centered service plans in a geographic area also provides HCBS. In
these cases, the State must devise conflict of interest protections
including separation of entity and provider functions within provider
entities, which must be approved by CMS. Individuals must be provided
with a clear and accessible alternative dispute resolution process.
(vii) Offers informed choices to the individual regarding the
services and supports they receive and from whom.
(viii) Includes a method for the individual to request updates to
the plan as needed.
(ix) Records the alternative home and community-based settings that
were considered by the individual.
(2) The Person-Centered Service Plan. The person-centered service
plan must reflect the services and supports that are important for the
individual to meet the needs identified through an assessment of
functional need, as well as what is important to the individual with
regard to preferences for the delivery of such services and supports.
Commensurate with the level of need of the individual, and the scope of
services and supports available under the State's 1915(c) HCBS waiver,
the written plan must:
(i) Reflect that the setting in which the individual resides is
chosen by the individual. The State must ensure that the setting chosen
by the individual is integrated in, and supports full access of
individuals receiving Medicaid HCBS to the greater community, including
opportunities to seek employment and work in competitive integrated
settings, engage in community life, control personal resources, and
receive services in the community to the same degree of access as
individuals not receiving Medicaid HCBS.
(ii) Reflect the individual's strengths and preferences.
(iii) Reflect clinical and support needs as identified through an
assessment of functional need.
(iv) Include individually identified goals and desired outcomes.
(v) Reflect the services and supports (paid and unpaid) that will
assist the individual to achieve identified goals, and the providers of
those services and supports, including natural supports. Natural
supports are unpaid supports that are provided voluntarily to the
individual in lieu of 1915(c) HCBS waiver services and supports.
(vi) Reflect risk factors and measures in place to minimize them,
including individualized back-up plans and strategies when needed.
(vii) Be understandable to the individual receiving services and
supports, and the individuals important in supporting him or her. At a
minimum, for the written plan to be understandable, it must be written
in plain language and in a manner that is accessible to individuals
with disabilities and persons who are limited English proficient,
consistent with Sec. 435.905(b) of this chapter.
(viii) Identify the individual and/or entity responsible for
monitoring the plan.
(ix) Be finalized and agreed to, with the informed consent of the
individual in writing, and signed by all individuals and providers
responsible for its implementation.
(x) Be distributed to the individual and other people involved in
the plan.
(xi) Include those services, the purpose or control of which the
individual elects to self-direct.
(xii) Prevent the provision of unnecessary or inappropriate
services and supports.
(xiii) Document that any modification of the additional conditions,
under paragraph (c)(4)(vi)(A) through (D) of this section, must be
supported by a specific assessed need and justified in the person-
centered service plan. The following requirements must be documented in
the person-centered service plan:
(A) Identify a specific and individualized assessed need.
(B) Document the positive interventions and supports used prior to
any modifications to the person-centered service plan.
(C) Document less intrusive methods of meeting the need that have
been tried but did not work.
(D) Include a clear description of the condition that is directly
proportionate to the specific assessed need.
(E) Include a regular collection and review of data to measure the
ongoing effectiveness of the modification.
(F) Include established time limits for periodic reviews to
determine if the modification is still necessary or can be terminated.
(G) Include informed consent of the individual.
(H) Include an assurance that interventions and supports will cause
no harm to the individual.
(3) Review of the Person-Centered Service Plan. The person-centered
service plan must be reviewed, and revised upon reassessment of
functional need as required by Sec. 441.365(e), at least every 12
months, when the individual's circumstances or needs change
significantly, or at the request of the individual.
(4) Home and Community-Based Settings. Home and community-based
settings must have all of the following qualities, and such other
qualities as the Secretary determines to be appropriate, based on the
needs of the individual as indicated in their person-centered service
plan:
(i) The setting is integrated in and supports full access of
individuals receiving Medicaid HCBS to the greater community, including
opportunities to seek employment and work in competitive integrated
settings, engage in community life, control personal resources, and
receive services in the community, to the same degree of access as
individuals not receiving Medicaid HCBS.
(ii) The setting is selected by the individual from among setting
options including non-disability specific settings and an option for a
private unit in a residential setting. The setting options are
identified and documented in the person-centered service plan and are
based on the individual's needs, preferences, and, for residential
settings, resources available for room and board.
(iii) Ensures an individual's rights of privacy, dignity and
respect, and freedom from coercion and restraint.
(iv) Optimizes, but does not regiment, individual initiative,
autonomy, and independence in making life choices, including but not
limited to, daily activities, physical environment, and with whom to
interact.
[[Page 3031]]
(v) Facilitates individual choice regarding services and supports,
and who provides them.
(vi) In a provider-owned or controlled residential setting, in
addition to the qualities at Sec. 441.301(c)(4)(i) through (v), the
following additional conditions must be met:
(A) The unit or dwelling is a specific physical place that can be
owned, rented, or occupied under a legally enforceable agreement by the
individual receiving services, and the individual has, at a minimum,
the same responsibilities and protections from eviction that tenants
have under the landlord/tenant law of the State, county, city, or other
designated entity. For settings in which landlord tenant laws do not
apply, the State must ensure that a lease, residency agreement or other
form of written agreement will be in place for each HCBS participant,
and that the document provides protections that address eviction
processes and appeals comparable to those provided under the
jurisdiction's landlord tenant law.
(B) Each individual has privacy in their sleeping or living unit:
(1) Units have entrance doors lockable by the individual, with only
appropriate staff having keys to doors.
(2) Individuals sharing units have a choice of roommates in that
setting.
(3) Individuals have the freedom to furnish and decorate their
sleeping or living units within the lease or other agreement.
(C) Individuals have the freedom and support to control their own
schedules and activities, and have access to food at any time.
(D) Individuals are able to have visitors of their choosing at any
time.
(E) The setting is physically accessible to the individual.
(F) Any modification of the additional conditions, under Sec.
441.301(c)(4)(vi)(A) through (D), must be supported by a specific
assessed need and justified in the person-centered service plan. The
following requirements must be documented in the person-centered
service plan:
(1) Identify a specific and individualized assessed need.
(2) Document the positive interventions and supports used prior to
any modifications to the person-centered service plan.
(3) Document less intrusive methods of meeting the need that have
been tried but did not work.
(4) Include a clear description of the condition that is directly
proportionate to the specific assessed need.
(5) Include regular collection and review of data to measure the
ongoing effectiveness of the modification.
(6) Include established time limits for periodic reviews to
determine if the modification is still necessary or can be terminated.
(7) Include the informed consent of the individual.
(8) Include an assurance that interventions and supports will cause
no harm to the individual.
(5) Settings that are not Home and Community-Based. Home and
community-based settings do not include the following:
(i) A nursing facility;
(ii) An institution for mental diseases;
(iii) An intermediate care facility for individuals with
intellectual disabilities;
(iv) A hospital; or
(v) Any other locations that have qualities of an institutional
setting, as determined by the Secretary. Any setting that is located in
a building that is also a publicly or privately operated facility that
provides inpatient institutional treatment, or in a building on the
grounds of, or immediately adjacent to, a public institution, or any
other setting that has the effect of isolating individuals receiving
Medicaid HCBS from the broader community of individuals not receiving
Medicaid HCBS will be presumed to be a setting that has the qualities
of an institution unless the Secretary determines through heightened
scrutiny, based on information presented by the State or other parties,
that the setting does not have the qualities of an institution and that
the setting does have the qualities of home and community-based
settings.
(6) Home and Community-Based Settings: Compliance and Transition:
(i) States submitting new and initial waiver requests must provide
assurances of compliance with the requirements of this section for home
and community-based settings as of the effective date of the waiver.
(ii) CMS will require transition plans for existing section 1915(c)
waivers and approved state plans providing home and community-based
services under section 1915(i) to achieve compliance with this section,
as follows:
(A) For each approved section 1915(c) HCBS waiver subject to
renewal or submitted for amendment within one year after the effective
date of this regulation, the State must submit a transition plan at the
time of the waiver renewal or amendment request that sets forth the
actions the State will take to bring the specific waiver into
compliance with this section. The waiver approval will be contingent on
the inclusion of the transition plan approved by CMS. The transition
plan must include all elements required by the Secretary; and within
one hundred and twenty days of the submission of the first waiver
renewal or amendment request the State must submit a transition plan
detailing how the State will operate all section 1915(c) HCBS waivers
and any section 1915(i) State plan benefit in accordance with this
section. The transition plan must include all elements including
timelines and deliverables as approved by the Secretary.
(B) For States that do not have a section 1915(c) HCBS waiver or a
section 1915(i) State plan benefit due for renewal or proposed for
amendments within one year of the effective date of this regulation,
the State must submit a transition plan detailing how the State will
operate all section 1915(c) HCBS waivers and any section 1915(i) State
plan benefit in accordance with this section. This plan must be
submitted no later than one year after the effective date of this
regulation. The transition plan must include all elements including
timelines and deliverables as approved by the Secretary.
(iii) A State must provide at least a 30-day public notice and
comment period regarding the transition plan(s) that the State intends
to submit to CMS for review and consideration, as follows:
(A) The State must at a minimum provide two (2) statements of
public notice and public input procedures.
(B) The State must ensure the full transition plan(s) is available
to the public for public comment.
(C) The State must consider and modify the transition plan, as the
State deems appropriate, to account for public comment.
(iv) A State must submit to CMS, with the proposed transition plan:
(A) Evidence of the public notice required.
(B) A summary of the comments received during the public notice
period, reasons why comments were not adopted, and any modifications to
the transition plan based upon those comments.
(v) Upon approval by CMS, the State will begin implementation of
the transition plans. The State's failure to submit an approvable
transition plan as required by this section and/or to comply with the
terms of the approved transition plan may result in compliance actions,
including but not limited to deferral/disallowance of Federal Financial
Participation.
0
15. Section 441.302 is amended by adding paragraphs (a)(4) and (a)(5)
to read as follows:
[[Page 3032]]
Sec. 441.302 State assurances.
* * * * *
(a) * * *
(4) Assurance that the State is able to meet the unique service
needs of the individuals when the State elects to serve more than one
target group under a single waiver, as specified in Sec.
441.301(b)(6).
(i) On an annual basis the State will include in the quality
section of the CMS-372 form (or any successor form designated by CMS)
data that indicates the State continues to serve multiple target groups
in the single waiver and that a single target group is not being
prioritized to the detriment of other groups.
(5) Assurance that services are provided in home and community
based settings, as specified in Sec. 441.301(c)(4).
0
16. Section 441.304 is amended by--
0
A. Revising the section heading as set forth below.
0
B. Redesignating paragraph (d) as new paragraph (g).
0
C. Adding new paragraphs (d), (e), and (f).
0
D. Revising newly designated paragraph (g).
The additions and revisions read as follows:
Sec. 441.304 Duration, extension, and amendment of a waiver.
* * * * *
(d) The agency may request that waiver modifications be made
effective retroactive to the first day of a waiver year, or another
date after the first day of a waiver year, in which the amendment is
submitted, unless the amendment involves substantive changes as
determined by CMS.
(1) Substantive changes include, but are not limited to, revisions
to services available under the waiver including elimination or
reduction of services, or reduction in the scope, amount, and duration
of any service, a change in the qualifications of service providers,
changes in rate methodology or a constriction in the eligible
population.
(2) A request for an amendment that involves a substantive change
as determined by CMS, may only take effect on or after the date when
the amendment is approved by CMS, and must be accompanied by
information on how the State has assured smooth transitions and minimal
effect on individuals adversely impacted by the change.
(e) The agency must provide public notice of any significant
proposed change in its methods and standards for setting payment rates
for services in accordance with Sec. 447.205 of this chapter.
(f) The agency must establish and use a public input process, for
any changes in the services or operations of the waiver.
(1) This process must be described fully in the State's waiver
application and be sufficient in light of the scope of the changes
proposed, to ensure meaningful opportunities for input for individuals
served, or eligible to be served, in the waiver.
(2) This process must be completed at a minimum of 30 days prior to
implementation of the proposed change or submission of the proposed
change to CMS, whichever comes first.
(3) This process must be used for both existing waivers that have
substantive changes proposed, either through the renewal or the
amendment process, and new waivers.
(4) This process must include consultation with Federally-
recognized Tribes, and in accordance with section 5006(e) of the
American Recovery and Reinvestment Act of 2009 (Pub. L. 111-5), Indian
health programs and Urban Indian Organizations.
(g)(1) If CMS finds that the Medicaid agency is not meeting one or
more of the requirements for a waiver contained in this subpart, the
agency is given a notice of CMS' findings and an opportunity for a
hearing to rebut the findings.
(2) If CMS determines that the agency is substantively out of
compliance with this subpart after the notice and any hearing, CMS may
employ strategies to ensure compliance as described in paragraph (g)(3)
of this section or terminate the waiver.
(3)(i) Strategies to ensure compliance may include the imposition
of a moratorium on waiver enrollments, other corrective strategies as
appropriate to ensure the health and welfare of waiver participants, or
the withholding of a portion of Federal payment for waiver services
until such time that compliance is achieved, or other actions as
determined by the Secretary as necessary to address non-compliance with
1915(c) of the Act, or termination. When a waiver is terminated, the
State must comport with Sec. 441.307.
(ii) CMS will provide states with a written notice of the impending
strategies to ensure compliance for a waiver program. The notice of
CMS' intent to utilize strategies to ensure compliance would include
the nature of the noncompliance, the strategy to be employed, the
effective date of the compliance strategy, the criteria for removing
the compliance strategy and the opportunity for a hearing.
0
17. Section 441.530 is added to read as follows:
Sec. 441.530 Home and Community-Based Setting.
(a) States must make available attendant services and supports in a
home and community-based setting consistent with both paragraphs (a)(1)
and (a)(2) of this section.
(1) Home and community-based settings must have all of the
following qualities, and such other qualities as the Secretary
determines to be appropriate, based on the needs of the individual as
indicated in their person-centered service plan:
(i) The setting is integrated in and supports full access of
individuals receiving Medicaid HCBS to the greater community, including
opportunities to seek employment and work in competitive integrated
settings, engage in community life, control personal resources, and
receive services in the community, to the same degree of access as
individuals not receiving Medicaid HCBS.
(ii) The setting is selected by the individual from among setting
options, including non-disability specific settings and an option for a
private unit in a residential setting. The setting options are
identified and documented in the person-centered service plan and are
based on the individual's needs, preferences, and, for residential
settings, resources available for room and board.
(iii) Ensures an individual's rights of privacy, dignity and
respect, and freedom from coercion and restraint.
(iv) Optimizes but does not regiment individual initiative,
autonomy, and independence in making life choices, including but not
limited to, daily activities, physical environment, and with whom to
interact.
(v) Facilitates individual choice regarding services and supports,
and who provides them.
(vi) In a provider-owned or controlled residential setting, in
addition to the above qualities at paragraphs (a)(1)(i) through (v) of
this section, the following additional conditions must be met:
(A) The unit or dwelling is a specific physical place that can be
owned, rented or occupied under a legally enforceable agreement by the
individual receiving services, and the individual has, at a minimum,
the same responsibilities and protections from eviction that tenants
have under the landlord tenant law of the State, county, city or other
designated entity. For settings in which landlord tenant laws do not
apply, the State must ensure that a lease, residency agreement or other
form of written agreement will be in
[[Page 3033]]
place for each participant and that the document provides protections
that address eviction processes and appeals comparable to those
provided under the jurisdiction's landlord tenant law.
(B) Each individual has privacy in their sleeping or living unit:
(1) Units have entrance doors lockable by the individual, with only
appropriate staff having keys to doors as needed.
(2) Individuals sharing units have a choice of roommates in that
setting.
(3) Individuals have the freedom to furnish and decorate their
sleeping or living units within the lease or other agreement.
(C) Individuals have the freedom and support to control their own
schedules and activities, and have access to food at any time.
(D) Individuals are able to have visitors of their choosing at any
time.
(E) The setting is physically accessible to the individual.
(F) Any modification of the additional conditions, under paragraphs
(a)(1)(vi)(A) through (D) of this section, must be supported by a
specific assessed need and justified in the person-centered service
plan. The following requirements must be documented in the person-
centered service plan:
(1) Identify a specific and individualized assessed need.
(2) Document the positive interventions and supports used prior to
any modifications to the person-centered service plan.
(3) Document less intrusive methods of meeting the need that have
been tried but did not work.
(4) Include a clear description of the condition that is directly
proportionate to the specific assessed need.
(5) Include regulation collection and review of data to measure the
ongoing effectiveness of the modification.
(6) Include established time limits for periodic reviews to
determine if the modification is still necessary or can be terminated.
(7) Include the informed consent of the individual.
(8) Include an assurance that interventions and supports will cause
no harm to the individual.
(2) Home and community-based settings do not include the following:
(i) A nursing facility;
(ii) An institution for mental diseases;
(iii) An intermediate care facility for individuals with
intellectual disabilities;
(iv) A hospital providing long-term care services; or
(v) Any other locations that have qualities of an institutional
setting, as determined by the Secretary. Any setting that is located in
a building that is also a publicly or privately operated facility that
provides inpatient institutional treatment, or in a building on the
grounds of, or immediately adjacent to, a public institution, or any
other setting that has the effect of isolating individuals receiving
Medicaid HCBS from the broader community of individuals not receiving
Medicaid HCBS will be presumed to be a setting that has the qualities
of an institution unless the Secretary determines through heightened
scrutiny, based on information presented by the State or other parties,
that the setting does not have the qualities of an institution and that
the setting does have the qualities of home and community-based
settings.
(b) [Reserved]
0
18. A new subpart M, consisting of Sec. 441.700 through Sec. 441.745,
is added to part 441 to read as follows:
Subpart M--State Plan Home and Community-Based Services for Elderly and
Disabled Individuals
Sec.
441.700 Basis and purpose.
441.705 State plan requirements.
441.710 State plan home and community-based services under section
1915(i)(1) of the Act.
441.715 Needs-based criteria and evaluation.
441.720 Independent assessment.
441.725 Person-centered service plan.
441.730 Provider qualifications.
441.735 Definition of individual's representative.
441.740 Self-directed services.
441.745 State plan HCBS administration: State responsibilities and
quality improvement.
Subpart M--State Plan Home and Community-Based Services for the
Elderly and Individuals with Disabilities
Sec. 441.700 Basis and purpose.
Section 1915(i) of the Act permits States to offer one or more home
and community-based services (HCBS) under their State Medicaid plans to
qualified individuals with disabilities or individuals who are elderly.
Those services are listed in Sec. 440.182 of this chapter, and are
described by the State, including any limitations of the services. This
optional benefit is known as the State plan HCBS benefit. This subpart
describes what a State Medicaid plan must provide when the State elects
to include the optional benefit, and defines State responsibilities.
Sec. 441.705 State plan requirements.
A State plan that provides section 1915(i) of the Act State plan
home and community-based services must meet the requirements of this
subpart.
Sec. 441.710 State plan home and community-based services under
section 1915(i)(1) of the Act.
(a) Home and Community-Based Setting. States must make State plan
HCBS available in a home and community-based setting consistent with
both paragraphs (a)(1) and (a)(2) of this section.
(1) Home and community-based settings must have all of the
following qualities, and such other qualities as the Secretary
determines to be appropriate, based on the needs of the individual as
indicated in their person-centered service plan:
(i) The setting is integrated in and supports full access of
individuals receiving Medicaid HCBS to the greater community, including
opportunities to seek employment and work in competitive integrated
settings, engage in community life, control personal resources, and
receive services in the community, to the same degree of access as
individuals not receiving Medicaid HCBS.
(ii) The setting is selected by the individual from among setting
options, including non-disability specific settings and an option for a
private unit in a residential setting. The setting options are
identified and documented in the person-centered service plan and are
based on the individual's needs, preferences, and, for residential
settings, resources available for room and board.
(iii) Ensures an individual's rights of privacy, dignity and
respect, and freedom from coercion and restraint.
(iv) Optimizes, but does not regiment, individual initiative,
autonomy, and independence in making life choices, including but not
limited to, daily activities, physical environment, and with whom to
interact.
(v) Facilitates individual choice regarding services and supports,
and who provides them.
(vi) In a provider-owned or controlled residential setting, in
addition to the above qualities at paragraphs (a)(1)(i) through (v) of
this section, the following additional conditions must be met:
(A) The unit or dwelling is a specific physical place that can be
owned, rented, or occupied under a legally enforceable agreement by the
individual receiving services, and the individual has, at a minimum,
the same responsibilities and protections from eviction that tenants
have under the landlord/tenant law of the state, county, city, or other
designated entity. For settings in which landlord tenant laws do not
apply, the State must ensure that
[[Page 3034]]
a lease, residency agreement or other form of written agreement will be
in place for each HCBS participant and that the document provides
protections that address eviction processes and appeals comparable to
those provided under the jurisdiction's landlord tenant law;
(B) Each individual has privacy in their sleeping or living unit:
(1) Units have entrance doors lockable by the individual, with only
appropriate staff having keys to doors;
(2) Individuals sharing units have a choice of roommates in that
setting; and
(3) Individuals have the freedom to furnish and decorate their
sleeping or living units within the lease or other agreement.
(C) Individuals have the freedom and support to control their own
schedules and activities, and have access to food at any time;
(D) Individuals are able to have visitors of their choosing at any
time;
(E) The setting is physically accessible to the individual; and
(F) Any modification of the additional conditions, under paragraphs
(a)(1)(vi)(A) through (D) of this section, must be supported by a
specific assessed need and justified in the person-centered service
plan. The following requirements must be documented in the person-
centered service plan:
(1) Identify a specific and individualized assessed need.
(2) Document the positive interventions and supports used prior to
any modifications to the person-centered service plan.
(3) Document less intrusive methods of meeting the need that have
been tried but did not work.
(4) Include a clear description of the condition that is directly
proportionate to the specific assessed need.
(5) Include regular collection and review of data to measure the
ongoing effectiveness of the modification.
(6) Include established time limits for periodic reviews to
determine if the modification is still necessary or can be terminated.
(7) Include the informed consent of the individual.
(8) Include an assurance that interventions and supports will cause
no harm to the individual.
(2) Home and community-based settings do not include the following:
(i) A nursing facility.
(ii) An institution for mental diseases.
(iii) An intermediate care facility for individuals with
intellectual disabilities.
(iv) A hospital.
(v) Any other locations that have qualities of an institutional
setting, as determined by the Secretary. Any setting that is located in
a building that is also a publicly or privately operated facility that
provides inpatient institutional treatment, or in a building on the
grounds of, or immediately adjacent to, a public institution, or any
other setting that has the effect of isolating individuals receiving
Medicaid HCBS from the broader community of individuals not receiving
Medicaid HCBS will be presumed to be a setting that has the qualities
of an institution unless the Secretary determines through heightened
scrutiny, based on information presented by the State or other parties,
that the setting does not have the qualities of an institution and that
the setting does have the qualities of home and community-based
settings.
(3) Compliance and transition:
(i) States submitting state plan amendments for new section 1915(i)
of the Act benefits must provide assurances of compliance with the
requirements of this section for home and community-based settings as
of the effective date of the state plan amendment;
(ii) CMS will require transition plans for existing section 1915(c)
waivers and approved state plans providing home and community-based
services under section 1915(i) to achieve compliance with this section,
as follows:
(A) For each approved section 1915(i) of the Act benefit subject to
renewal or submitted for amendment within one year after the effective
date of this regulation, the State must submit a transition plan at the
time of the renewal or amendment request that sets forth the actions
the State will take to bring the specific 1915(i) State plan benefit
into compliance with this section. The approval will be contingent on
the inclusion of the transition plan approved by CMS. The transition
plan must include all elements required by the Secretary; and within
one hundred and twenty days of the submission of the first renewal or
amendment request the State must submit a transition plan detailing how
the State will operate all section 1915(c) HCBS waivers and any section
1915(i) State plan benefit in accordance with this section. The
transition plan must include all elements including timelines and
deliverables as approved by the Secretary.
(B) For States that do not have a section 1915(c) waiver or a
section 1915(i) State plan benefit due for renewal or proposed for
amendments within one year of the effective date of this regulation,
the State must submit a transition plan detailing how the State will
operate all section 1915(c) waivers and any section 1915(i) State plan
benefit in accordance with this section. This plan must be submitted no
later than one year after the effective date of this regulation. The
transition plan must include all elements including timelines and
deliverables as approved by the Secretary.
(iii) A State must provide at least a 30-day public notice and
comment period regarding the transition plan(s) that the State intends
to submit to CMS for review and consideration, as follows:
(A) The State must at a minimum provide two (2) statements of
public notice and public input procedures.
(B) The State must ensure the full transition plan(s) is available
to the public for public comment.
(C) The State must consider and modify the transition plan, as the
State deems appropriate, to account for public comment.
(iv) A State must submit to CMS, with the proposed transition plan:
(A) Evidence of the public notice required.
(B) A summary of the comments received during the public notice
period, reasons why comments were not adopted, and any modifications to
the transition plan based upon those comments.
(v) Upon approval by CMS, the State will begin implementation of
the transition plans. The State's failure to submit an approvable
transition plan as required by this section and/or to comply with the
terms of the approved transition plan may result in compliance actions,
including but not limited to deferral/disallowance of Federal Financial
Participation.
(b) Needs-Based Eligibility Requirement. Meet needs-based criteria
for eligibility for the State plan HCBS benefit, as required in Sec.
441.715(a).
(c) Minimum State plan HCBS Requirement. Be assessed to require at
least one section 1915(i) home and community-based service at a
frequency determined by the State, as required in Sec. 441.720(a)(5).
(d) Target Population. Meet any applicable targeting criteria
defined by the State under the authority of paragraph (e)(2) of this
section.
(e) Nonapplication. The State may elect in the State plan amendment
approved under this subpart not to apply the following requirements
when determining eligibility:
(1) Section 1902(a)(10)(C)(i)(III) of the Act, pertaining to income
and resource eligibility rules for the medically needy living in the
community, but only for the purposes of providing State plan HCBS.
[[Page 3035]]
(2) Section 1902(a)(10)(B) of the Act, pertaining to comparability
of Medicaid services, but only for the purposes of providing section
1915(i) State plan HCBS. In the event that a State elects not to apply
comparability requirements:
(i) The State must describe the group(s) receiving State plan HCBS,
subject to the Secretary's approval. Targeting criteria cannot have the
impact of limiting the pool of qualified providers from which an
individual would receive services, or have the impact of requiring an
individual to receive services from the same entity from which they
purchase their housing. These groups must be defined on the basis of
any combination of the following:
(A) Age.
(B) Diagnosis.
(C) Disability.
(D) Medicaid Eligibility Group.
(ii) The State may elect in the State plan amendment to limit the
availability of specific services defined under the authority of Sec.
440.182(c) of this chapter or to vary the amount, duration, or scope of
those services, to one or more of the group(s) described in this
paragraph.
Sec. 441.715 Needs-based criteria and evaluation.
(a) Needs-based criteria. The State must establish needs-based
criteria for determining an individual's eligibility under the State
plan for the HCBS benefit, and may establish needs-based criteria for
each specific service. Needs-based criteria are factors used to
determine an individual's requirements for support, and may include
risk factors. The criteria are not characteristics that describe the
individual or the individual's condition. A diagnosis is not a
sufficient factor on which to base a determination of need. A criterion
can be considered needs-based if it is a factor that can only be
ascertained for a given person through an individualized evaluation of
need.
(b) More stringent institutional and waiver needs-based criteria.
The State plan HCBS benefit is available only if the State has in
effect needs-based criteria (as defined in paragraph (a) of this
section), for receipt of services in nursing facilities as defined in
section 1919(a) of the Act, intermediate care facilities for
individuals with intellectual disabilities as defined in Sec. 440.150
of this chapter, and hospitals as defined in Sec. 440.10 of this
chapter for which the State has established long-term level of care
(LOC) criteria, or waivers offering HCBS, and these needs-based
criteria are more stringent than the needs-based criteria for the State
plan HCBS benefit. If the State defines needs-based criteria for
individual State plan home and community-based services, it may not
have the effect of limiting who can benefit from the State plan HCBS in
an unreasonable way, as determined by the Secretary.
(1) These more stringent criteria must meet the following
requirements:
(i) Be included in the LOC determination process for each
institutional service and waiver.
(ii) Be submitted for inspection by CMS with the State plan
amendment that establishes the State Plan HCBS benefit.
(iii) Be in effect on or before the effective date of the State
plan HCBS benefit.
(2) In the event that the State modifies institutional LOC criteria
to meet the requirements under paragraph (b) or (c)(6) of this section
that such criteria be more stringent than the State plan HCBS needs-
based eligibility criteria, States may continue to receive FFP for
individuals receiving institutional services or waiver HCBS under the
LOC criteria previously in effect.
(c) Adjustment authority. The State may modify the needs-based
criteria established under paragraph (a) of this section, without prior
approval from the Secretary, if the number of individuals enrolled in
the State plan HCBS benefit exceeds the projected number submitted
annually to CMS. The Secretary may approve a retroactive effective date
for the State plan amendment modifying the criteria, as early as the
day following the notification period required under paragraph (c)(1)
of this section, if all of the following conditions are met:
(1) The State provides at least 60 days notice of the proposed
modification to the Secretary, the public, and each individual enrolled
in the State plan HCBS benefit.
(2) The State notice to the Secretary is submitted as an amendment
to the State plan.
(3) The adjusted needs-based eligibility criteria for the State
plan HCBS benefit are less stringent than needs-based institutional and
waiver LOC criteria in effect after the adjustment.
(4) Individuals who were found eligible for the State plan HCBS
benefit before modification of the needs-based criteria under this
adjustment authority must remain eligible for the HCBS benefit until
such time as:
(i) The individual no longer meets the needs-based criteria used
for the initial determination of eligibility; or
(ii) The individual is no longer eligible for or enrolled in
Medicaid or the HCBS benefit.
(5) Any changes in service due to the modification of needs-based
criteria under this adjustment authority are treated as actions as
defined in Sec. 431.201 of this chapter and are subject to the
requirements of part 431, subpart E of this chapter.
(6) In the event that the State also needs to modify institutional
level of care criteria to meet the requirements under paragraph (b) of
this section that such criteria be more stringent than the State plan
HCBS needs-based eligibility criteria, the State may adjust the
modified institutional LOC criteria under this adjustment authority.
The adjusted institutional LOC criteria must be at least as stringent
as those in effect before they were modified to meet the requirements
in paragraph (b) of this section.
(d) Independent evaluation and determination of eligibility.
Eligibility for the State plan HCBS benefit must be determined through
an independent evaluation of each individual according to the
requirements of this subpart. The independent evaluation complies with
the following requirements:
(1) Is performed by an agent that is independent and qualified as
defined in Sec. 441.730.
(2) Applies the needs-based eligibility criteria that the State has
established under paragraph (a) of this section, and the general
eligibility requirements under Sec. 435.219 and Sec. 436.219 of this
chapter.
(3) Includes consultation with the individual, and if applicable,
the individual's representative as defined under Sec. 441.735.
(4) Assesses the individual's support needs.
(5) Uses only current and accurate information from existing
records, and obtains any additional information necessary to draw valid
conclusions about the individual's support needs.
(6) Evaluations finding that an individual is not eligible for the
State plan HCBS benefit are treated as actions defined in Sec. 431.201
of this chapter and are subject to the requirements of part 431 subpart
E of this chapter.
(e) Periodic redetermination. Independent reevaluations of each
individual receiving the State plan HCBS benefit must be performed at
least every 12 months, to determine whether the individual continues to
meet eligibility requirements. Redeterminations must meet the
requirements of paragraph (d) of this section.
[[Page 3036]]
Sec. 441.720 Independent assessment.
(a) Requirements. For each individual determined to be eligible for
the State plan HCBS benefit, the State must provide for an independent
assessment of needs, which may include the results of a standardized
functional needs assessment, in order to establish a service plan. In
applying the requirements of section 1915(i)(1)(F) of the Act, the
State must:
(1) Perform a face-to-face assessment of the individual by an agent
who is independent and qualified as defined in Sec. 441.730, and with
a person-centered process that meets the requirements of Sec.
441.725(a) and is guided by best practice and research on effective
strategies that result in improved health and quality of life outcomes.
(i) For the purposes of this section, a face-to-face assessment may
include assessments performed by telemedicine, or other information
technology medium, if the following conditions are met:
(A) The agent performing the assessment is independent and
qualified as defined in Sec. 441.730 and meets the provider
qualifications defined by the State, including any additional
qualifications or training requirements for the operation of required
information technology.
(B) The individual receives appropriate support during the
assessment, including the use of any necessary on-site support-staff.
(C) The individual provides informed consent for this type of
assessment.
(ii) [Reserved]
(2) Conduct the assessment in consultation with the individual, and
if applicable, the individual's authorized representative, and include
the opportunity for the individual to identify other persons to be
consulted, such as, but not limited to, the individual's spouse,
family, guardian, and treating and consulting health and support
professionals responsible for the individual's care.
(3) Examine the individual's relevant history including the
findings from the independent evaluation of eligibility, medical
records, an objective evaluation of functional ability, and any other
records or information needed to develop the person-centered service
plan as required in Sec. 441.725.
(4) Include in the assessment the individual's physical, cognitive,
and behavioral health care and support needs, strengths and
preferences, available service and housing options, and if unpaid
caregivers will be relied upon to implement any elements of the person-
centered service plan, a caregiver assessment.
(5) For each service, apply the State's additional needs-based
criteria (if any) that the individual may require. Individuals are
considered enrolled in the State plan HCBS benefit only if they meet
the eligibility and needs-based criteria for the benefit, and are also
assessed to require and receive at least one home and community-based
service offered under the State plan for medical assistance.
(6) Include in the assessment, if the State offers individuals the
option to self-direct a State plan home and community-based service or
services, any information needed for the self-directed portion of the
service plan, as required in Sec. 441.740(b), including the ability of
the individual (with and without supports) to exercise budget or
employer authority.
(7) Include in the assessment, for individuals receiving
habilitation services, documentation that no Medicaid services are
provided which would otherwise be available to the individual,
specifically including but not limited to services available to the
individual through a program funded under section 110 of the
Rehabilitation Act of 1973, or the Individuals with Disabilities
Education Improvement Act of 2004.
(8) Include in the assessment and subsequent service plan, for
individuals receiving Secretary approved services under the authority
of Sec. 440.182 of this chapter, documentation that no State plan HCBS
are provided which would otherwise be available to the individual
through other Medicaid services or other Federally funded programs.
(9) Include in the assessment and subsequent service plan, for
individuals receiving HCBS through a waiver approved under Sec.
441.300, documentation that HCBS provided through the State plan and
waiver are not duplicative.
(10) Coordinate the assessment and subsequent service plan with any
other assessment or service plan required for services through a waiver
authorized under section 1115 or section 1915 of the Social Security
Act.
(b) Reassessments. The independent assessment of need must be
conducted at least every 12 months and as needed when the individual's
support needs or circumstances change significantly, in order to revise
the service plan.
Sec. 441.725 Person-centered service plan.
(a) Person-centered planning process. Based on the independent
assessment required in Sec. 441.720, the State must develop (or
approve, if the plan is developed by others) a written service plan
jointly with the individual (including, for purposes of this paragraph,
the individual and the individual's authorized representative if
applicable). The person-centered planning process is driven by the
individual. The process:
(1) Includes people chosen by the individual.
(2) Provides necessary information and support to ensure that the
individual directs the process to the maximum extent possible, and is
enabled to make informed choices and decisions.
(3) Is timely and occurs at times and locations of convenience to
the individual.
(4) Reflects cultural considerations of the individual and is
conducted by providing information in plain language and in a manner
that is accessible to individuals with disabilities and persons who are
limited English proficient, consistent with Sec. 435.905(b) of this
chapter.
(5) Includes strategies for solving conflict or disagreement within
the process, including clear conflict of interest guidelines for all
planning participants.
(6) Offers choices to the individual regarding the services and
supports the individual receives and from whom.
(7) Includes a method for the individual to request updates to the
plan, as needed.
(8) Records the alternative home and community-based settings that
were considered by the individual.
(b) The person-centered service plan. The person-centered service
plan must reflect the services and supports that are important for the
individual to meet the needs identified through an assessment of
functional need, as well as what is important to the individual with
regard to preferences for the delivery of such services and supports.
Commensurate with the level of need of the individual, and the scope of
services and supports available under the State plan HCBS benefit, the
written plan must:
(1) Reflect that the setting in which the individual resides is
chosen by the individual. The State must ensure that the setting chosen
by the individual is integrated in, and supports full access of
individuals receiving Medicaid HCBS to the greater community, including
opportunities to seek employment and work in competitive integrated
settings, engage in community life, control personal resources, and
receive services in the community to the same degree of access as
individuals not receiving Medicaid HCBS.
(2) Reflect the individual's strengths and preferences.
[[Page 3037]]
(3) Reflect clinical and support needs as identified through an
assessment of functional need.
(4) Include individually identified goals and desired outcomes.
(5) Reflect the services and supports (paid and unpaid) that will
assist the individual to achieve identified goals, and the providers of
those services and supports, including natural supports. Natural
supports are unpaid supports that are provided voluntarily to the
individual in lieu of State plan HCBS.
(6) Reflect risk factors and measures in place to minimize them,
including individualized backup plans and strategies when needed.
(7) Be understandable to the individual receiving services and
supports, and the individuals important in supporting him or her. At a
minimum, for the written plan to be understandable, it must be written
in plain language and in a manner that is accessible to individuals
with disabilities and persons who are limited English proficient,
consistent with Sec. 435.905(b) of this chapter.
(8) Identify the individual and/or entity responsible for
monitoring the plan.
(9) Be finalized and agreed to, with the informed consent of the
individual in writing, and signed by all individuals and providers
responsible for its implementation.
(10) Be distributed to the individual and other people involved in
the plan.
(11) Include those services, the purchase or control of which the
individual elects to self-direct, meeting the requirements of Sec.
441.740.
(12) Prevent the provision of unnecessary or inappropriate services
and supports.
(13) Document that any modification of the additional conditions,
under Sec. 441.710(a)(1)(vi)(A) through (D) of this chapter, must be
supported by a specific assessed need and justified in the person-
centered service plan. The following requirements must be documented in
the person-centered service plan:
(i) Identify a specific and individualized assessed need.
(ii) Document the positive interventions and supports used prior to
any modifications to the person-centered service plan.
(iii) Document less intrusive methods of meeting the need that have
been tried but did not work.
(iv) Include a clear description of the condition that is directly
proportionate to the specific assessed need.
(v) Include a regular collection and review of data to measure the
ongoing effectiveness of the modification.
(vi) Include established time limits for periodic reviews to
determine if the modification is still necessary or can be terminated.
(vii) Include informed consent of the individual; and
(viii) Include an assurance that the interventions and supports
will cause no harm to the individual.
(c) Reviewing the person-centered service plan. The person-centered
service plan must be reviewed, and revised upon reassessment of
functional need as required in Sec. 441.720, at least every 12 months,
when the individual's circumstances or needs change significantly, and
at the request of the individual.
Sec. 441.730 Provider qualifications.
(a) Requirements. The State must provide assurances that necessary
safeguards have been taken to protect the health and welfare of
enrollees in State plan HCBS, and must define in writing standards for
providers (both agencies and individuals) of HCBS and for agents
conducting individualized independent evaluation, independent
assessment, and service plan development.
(b) Conflict of interest standards. The State must define conflict
of interest standards that ensure the independence of individual and
agency agents who conduct (whether as a service or an administrative
activity) the independent evaluation of eligibility for State plan
HCBS, who are responsible for the independent assessment of need for
HCBS, or who are responsible for the development of the service plan.
The conflict of interest standards apply to all individuals and
entities, public or private. At a minimum, these agents must not be any
of the following:
(1) Related by blood or marriage to the individual, or to any paid
caregiver of the individual.
(2) Financially responsible for the individual.
(3) Empowered to make financial or health-related decisions on
behalf of the individual.
(4) Holding financial interest, as defined in Sec. 411.354 of this
chapter, in any entity that is paid to provide care for the individual.
(5) Providers of State plan HCBS for the individual, or those who
have an interest in or are employed by a provider of State plan HCBS
for the individual, except when the State demonstrates that the only
willing and qualified agent to perform independent assessments and
develop person-centered service plans in a geographic area also
provides HCBS, and the State devises conflict of interest protections
including separation of agent and provider functions within provider
entities, which are described in the State plan for medical assistance
and approved by the Secretary, and individuals are provided with a
clear and accessible alternative dispute resolution process.
(c) Training. Qualifications for agents performing independent
assessments and plans of care must include training in assessment of
individuals whose physical, cognitive, or mental conditions trigger a
potential need for home and community-based services and supports, and
current knowledge of available resources, service options, providers,
and best practices to improve health and quality of life outcomes.
Sec. 441.735 Definition of individual's representative.
In this subpart, the term individual's representative means, with
respect to an individual being evaluated for, assessed regarding, or
receiving State plan HCBS, the following:
(a) The individual's legal guardian or other person who is
authorized under State law to represent the individual for the purpose
of making decisions related to the person's care or well-being. In
instances where state law confers decision-making authority to the
individual representative, the individual will lead the service
planning process to the extent possible.
(b) Any other person who is authorized under Sec. 435.923 of this
chapter, or under the policy of the State Medicaid Agency to represent
the individual, including but not limited to, a parent, a family
member, or an advocate for the individual.
(c) When the State authorizes representatives in accordance with
paragraph (b) of this section, the State must have policies describing
the process for authorization; the extent of decision-making
authorized; and safeguards to ensure that the representative uses
substituted judgment on behalf of the individual. State policies must
address exceptions to using substituted judgment when the individual's
wishes cannot be ascertained or when the individual's wishes would
result in substantial harm to the individual. States may not refuse the
authorized representative that the individual chooses, unless in the
process of applying the requirements for authorization, the State
discovers and can document evidence that the representative is not
acting in accordance with these policies or cannot perform the required
functions. States must continue to meet the requirements regarding the
person-
[[Page 3038]]
centered planning process at Sec. 441.725 of this chapter.
Sec. 441.740 Self-directed services.
(a) State option. The State may choose to offer an election for
self-directing HCBS. The term ``self-directed'' means, with respect to
State plan HCBS listed in Sec. 440.182 of this chapter, services that
are planned and purchased under the direction and control of the
individual, including the amount, duration, scope, provider, and
location of the HCBS. For purposes of this paragraph, individual means
the individual and, if applicable, the individual's representative as
defined in Sec. 441.735.
(b) Service plan requirement. Based on the independent assessment
required in Sec. 441.720, the State develops a service plan jointly
with the individual as required in Sec. 441.725. If the individual
chooses to direct some or all HCBS, the service plan must meet the
following additional requirements:
(1) Specify the State plan HCBS that the individual will be
responsible for directing.
(2) Identify the methods by which the individual will plan, direct
or control services, including whether the individual will exercise
authority over the employment of service providers and/or authority
over expenditures from the individualized budget.
(3) Include appropriate risk management techniques that explicitly
recognize the roles and sharing of responsibilities in obtaining
services in a self-directed manner and assure the appropriateness of
this plan based upon the resources and support needs of the individual.
(4) Describe the process for facilitating voluntary and involuntary
transition from self-direction including any circumstances under which
transition out of self-direction is involuntary. There must be state
procedures to ensure the continuity of services during the transition
from self-direction to other service delivery methods.
(5) Specify the financial management supports, as required in
paragraph (e) of this section, to be provided.
(c) Employer authority. If the person-centered service plan
includes authority to select, manage, or dismiss providers of the State
plan HCBS, the person-centered service plan must specify the authority
to be exercised by the individual, any limits to the authority, and
specify parties responsible for functions outside the authority the
individual exercises.
(d) Budget authority. If the person-centered service plan includes
an individualized budget (which identifies the dollar value of the
services and supports under the control and direction of the
individual), the person-centered service plan must meet the following
requirements:
(1) Describe the method for calculating the dollar values in the
budget, based on reliable costs and service utilization.
(2) Define a process for making adjustments in dollar values to
reflect changes in an individual's assessment and service plan.
(3) Provide a procedure to evaluate expenditures under the budget.
(4) Not result in payment for medical assistance to the individual.
(e) Functions in support of self-direction. When the State elects
to offer self-directed State plan HCBS, it must offer the following
individualized supports to individuals receiving the services and their
representatives:
(1) Information and assistance consistent with sound principles and
practice of self-direction.
(2) Financial management supports to meet the following
requirements:
(i) Manage Federal, State, and local employment tax, labor,
worker's compensation, insurance, and other requirements that apply
when the individual functions as the employer of service providers.
(ii) Make financial transactions on behalf of the individual when
the individual has personal budget authority.
(iii) Maintain separate accounts for each individual's budget and
provide periodic reports of expenditures against budget in a manner
understandable to the individual.
(3) Voluntary training on how to select, manage, and dismiss
providers of State plan HCBS.
Sec. 441.745 State plan HCBS administration: State responsibilities
and quality improvement.
(a) State plan HCBS administration.
(1) State responsibilities. The State must carry out the following
responsibilities in administration of its State plan HCBS:
(i) Number served. The State will annually provide CMS with the
projected number of individuals to be enrolled in the benefit and the
actual number of unduplicated individuals enrolled in State plan HCBS
in the previous year.
(ii) Access to services. The State must grant access to all State
plan HCBS assessed to be needed in accordance with a service plan
consistent with Sec. 441.725, to individuals who have been determined
to be eligible for the State plan HCBS benefit, subject to the
following requirements:
(A) A State must determine that provided services meet medical
necessity criteria.
(B) A State may limit access to services through targeting criteria
established by Sec. 441.710(e)(2).
(C) A State may not limit access to services based upon the income
of eligible individuals, the cost of services, or the individual's
location in the State.
(iii) Appeals. A State must provide individuals with advance notice
of and the right to appeal terminations, suspensions, or reductions of
Medicaid eligibility or covered services as described in part 431,
subpart E.
(2) Administration.
(i) Option for presumptive payment.
(A) The State may provide for a period of presumptive payment, not
to exceed 60 days, for Medicaid eligible individuals the State has
reason to believe may be eligible for the State plan HCBS benefit. FFP
is available for both services that meet the definition of medical
assistance and necessary administrative expenditures for evaluation of
eligibility for the State plan HCBS benefit under Sec. 441.715(d) and
assessment of need for specific HCBS under Sec. 441.720(a), prior to
an individual's receipt of State plan HCBS or determination of
ineligibility for the benefit.
(B) If an individual the State has reason to believe may be
eligible for the State plan HCBS benefit is evaluated and assessed
under the presumptive payment option and found not to be eligible for
the benefit, FFP is available for services that meet the definition of
medical assistance and necessary administrative expenditures. The
individual so determined will not be considered to have enrolled in the
State plan HCBS benefit for purposes of determining the annual number
of participants in the benefit.
(ii) Option for Phase-in of Services and Eligibility
(A) In the event that a State elects to establish targeting
criteria through Sec. 441.710(e)(2), the State may limit the
enrollment of individuals or the provision services to enrolled
individuals based upon criteria described in a phase-in plan, subject
to CMS approval. A State which elects to target the State plan HCBS
benefit and to phase-in enrollment and/or services must submit a phase-
in plan for approval by CMS that describes, at a minimum:
(1) The criteria used to limit enrollment or service delivery.
(2) The rationale for phasing-in services and/or eligibility.
(3) Timelines and benchmarks to ensure that the benefit is
available
[[Page 3039]]
statewide to all eligible individuals within the initial 5-year
approval.
(B) If a State elects to phase-in the enrollment of individuals
based on highest need, the phase-in plan must use the needs-based
criteria described in Sec. 441.715(a) to establish priority for
enrollment. Such criteria must be based upon the assessed need of
individuals, with higher-need individuals receiving services prior to
individuals with lower assessed need.
(C) If a State elects to phase-in the provision of any services,
the phase-in plan must include a description of the services that will
not be available to all eligible individuals, the rationale for
limiting the provision of services, and assurance that all individuals
with access to a willing and qualified provider may receive services.
(D) The plan may not include a cap on the number of enrollees.
(E) The plan must include a timeline to assure that all eligible
individuals receive all included services prior to the end of the first
5-year approval period, described in paragraph (a)(2)(vi) of this
section.
(iii) Reimbursement methodology. The State plan amendment to
provide State plan HCBS must contain a description of the reimbursement
methodology for each covered service, in accordance with CMS sub-
regulatory guidance. To the extent that the reimbursement methodologies
for any self-directed services differ from those descriptions, the
method for setting reimbursement methodology for the self-directed
services must also be described.
(iv) Operation. The State plan amendment to provide State plan HCBS
must contain a description of the State Medicaid agency line of
authority for operating the State plan HCBS benefit, including
distribution of functions to other entities.
(v) Modifications. The agency may request that modifications to the
benefit be made effective retroactive to the first day of a fiscal year
quarter, or another date after the first day of a fiscal year quarter,
in which the amendment is submitted, unless the amendment involves
substantive change. Substantive changes may include, but are not
limited to, the following:
(A) Revisions to services available under the benefit including
elimination or reduction in services, and changes in the scope, amount
and duration of the services.
(B) Changes in the qualifications of service providers, rate
methodology, or the eligible population.
(1) Request for Amendments. A request for an amendment that
involves a substantive change as determined by CMS--
(i) May only take effect on or after the date when the amendment is
approved by CMS; and
(ii) Must be accompanied by information on how the State will
ensure for transitions with minimal adverse impact on individuals
impacted by the change.
(2) [Reserved]
(vi) Periods of approval.
(A) If a State elects to establish targeting criteria through Sec.
441.710(e)(2)(i), the approval of the State Plan Amendment will be in
effect for a period of 5 years from the effective date of the
amendment. To renew State plan HCBS for an additional 5-year period,
the State must provide a written request for renewal to CMS at least
180 days prior to the end of the approval period. CMS approval of a
renewal request is contingent upon State adherence to Federal
requirements and the state meeting its objectives with respect to
quality improvement and beneficiary outcomes.
(B) If a State does not elect to establish targeting criteria
through Sec. 441.710(e)(2)(i), the limitations on length of approval
does not apply.
(b) Quality improvement strategy: Program performance and quality
of care. States must develop and implement an HCBS quality improvement
strategy that includes a continuous improvement process and measures of
program performance and experience of care. The strategy must be
proportionate to the scope of services in the State plan HCBS benefit
and the number of individuals to be served. The State will make this
information available to CMS at a frequency determined by the Secretary
or upon request.
(1) Quality Improvement Strategy. The quality improvement strategy
must include all of the following:
(i) Incorporate a continuous quality improvement process that
includes monitoring, remediation, and quality improvement.
(ii) Be evidence-based, and include outcome measures for program
performance, quality of care, and individual experience as determined
by the Secretary.
(iii) Provide evidence of the establishment of sufficient
infrastructure to implement the program effectively.
(iv) Measure individual outcomes associated with the receipt of
HCBS, related to the implementation of goals included in the individual
service plan.
(2) [Reserved]
PART 447--PAYMENTS FOR SERVICES
0
19. The authority citation for part 447 continues to read as follows:
Authority: Sec. 1102 of the Social Security Act (42 U.S.C.
1302).
0
20. Section 447.10 is amended by adding new paragraph (g)(4) to read as
follows:
Sec. 447.10 Prohibition against reassignment of provider claims.
* * * * *
(g) * * *
(4) In the case of a class of practitioners for which the Medicaid
program is the primary source of service revenue, payment may be made
to a third party on behalf of the individual practitioner for benefits
such as health insurance, skills training and other benefits customary
for employees.
* * * * *
Authority: (Catalog of Federal Domestic Assistance Program No.
93.778, Medical Assistance Program)
Dated: September 18, 2013.
Marilyn Tavenner,
Administrator, Centers for Medicare & Medicaid Services.
Approved: December 9, 2013.
Kathleen Sebelius,
Secretary, Department of Health and Human Services.
[FR Doc. 2014-00487 Filed 1-10-14; 11:15 am]
BILLING CODE 4120-01-P
