Federal Medicaid matching funds for states

The Balancing Incentive Payment Program was created by the Affordable Care Act. Under the program, states can receive increased federal Medicaid matching funds to rebalance their long term services and supports budgets. The program has $3 billion to award to states that choose to participate in the program. Thus far, $800,000 has been awarded to New Hampshire, Maryland, Georgia, Mississippi, Missouri, Iowa, Texas, and Indiana. States are eligible for a 2% increase in their federal medical assistance percentage (FMAP) if they currently spend less that 50% of their long term services and supports budget on home and community based services (HCBS) and a 5% increase if they spend 25% or less on HCBS. The funds are available through 2015.

California First State To Receive Approval for Services Under Community First Choice Option

California will be the first State to receive new federal Medicaid funding from the Community First Choice (CFC) Option in the Affordable Care Act, according to an announcement made today by the Centers for Medicare & Medicaid Services (CMS) Acting Administrator Marilyn Tavenner. The CFC Option is a new Medicaid State plan option which allows States to provide broadly-defined home and community-based attendant services to certain Medicaid beneficiaries who would otherwise need nursing facility or other institutional services. States choosing to participate receive a 6 percentage point increase in their federal medical assistance percentage (FMAP) for services provided under this option. California will receive an estimated $258 million dollars for the first year of implementation, and $315 million for the second year. The increased funding is available as long as the option is included as a benefit in the State’s Medicaid program.

Final Rules Issued Regarding Community First Choice Option

The Centers for Medicare and Medicaid Services (CMS) issued two rules concerning community-based services for people with disabilities – one final rule and one proposed rule.

The final rule implements the Community First Choice (CFC) Option, a provision of the Affordable Care Act that provides an incentive to states to expand community-based attendant services and supports to people with disabilities who are eligible for institutional level of care. States that choose the CFC option will receive a 6% increase in their federal Medicaid share (FMAP) for those services. The rule requires states to provide CFC services only in a “home and community” setting. Unfortunately, the rule does not include the definition of a home and community setting. The definition in the proposed rule generated so many comments that CMS decided to revise the definition and seek public input again. The revised definition will appear in the proposed rules implementing the Home and Community Based State Plan option described below. Once a definition is finalized it will apply across all of the home and community programs – 1915(c) waiver programs, the 1915(i) State Plan option, and the 1915(k) CFC Option. The CFC final rule should appear in the Federal Register on May 7.

Federal Medical Assistance Percentage (FMAP) – States can apply for an increased payment

The Centers for Medicare and Medicaid Services (CMS) sent guidance to states about the State Balancing Incentive Payments Program effective October 1. States can apply for an increased Federal Medical Assistance Percentage (FMAP) payment for diverting people from institutional care by increasing access to community based services and supports. States that rely heavily on institutional services get more FMAP as an incentive to move their systems away from facilities and toward community-based service provision.

States in which only 25% of spending is for community-based services (75% or more of spending goes toward institutional services) will receive a 5% increase in FMAP and states that spend 50% on community-based services (and 50% on institutional services) will receive 2% increase in their FMAP. States must create a single point of entry, conflict-free case management services, and a standardized assessment instrument in order to be eligible for grants.