Medicaid Section 1115 Managed Long-Term Services and Supports Waivers: A Survey of Enrollment, Spending, and Program Policies

Key Findings
  1. E. Reaves & M. Musumeci, Medicaid and Long-Term Services and Supports:  A Primer (Dec. 2015), https://www.kff.org/medicaid/report/medicaid-and-long-term-services-and-supports-a-primer/.

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  2. An exception is Vermont, which uses a state entity to deliver Medicaid MLTSS on an at-risk basis. In addition, Arizona uses a state entity to delivery Medicaid MLTSS to beneficiaries with intellectual and developmental disabilities.

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  3. S. Eiken, K. Sredl, B. Burwell, & P. Saucier, Medicaid Expenditures for Long-Term Services and Supports (LTSS) in FY 2014: Managed LTSS Reached 15 Percent of LTSS Spending, Truven Health Analytics (April 15, 2016), available at https://www.medicaid.gov/medicaid/ltss/downloads/ltss-expenditures-2014.pdf.

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  4. J. Paradise and M. Musumeci, CMS’s Final Rule on Medicaid Managed Care:  A Summary of Major Provisions (June 2016), https://www.kff.org/medicaid/issue-brief/cmss-final-rule-on-medicaid-managed-care-a-summary-of-major-provisions/.  In 2013, CMS issued guidance to states about best practices in MLTSS waivers, which contained many provisions that are now codified in the 2016 regulations.  CMS, Guidance to States Using 1115 Demonstrations or 1915(b) Waivers for Managed Long-Term Services and Supports Programs (May 2013), http://www.medicaid.gov/Medicaid-CHIP-Program-Information/By-Topics/DeliverySystems/Downloads/1115-and-1915b-MLTSS-guidance.pdf.

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  5. Kaiser Family Foundation, Key Medicaid Questions Post-Election (Nov. 2016), https://www.kff.org/medicaid/fact-sheet/key-medicaid-questions-post-election/.

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  6. See generally M. Musumeci & E. Reaves, Medicaid Beneficiaries Who Need Home and Community-Based Services:  Supporting Independent Living and Community Integration (March, 2014), https://www.kff.org/medicaid/report/medicaid-beneficiaries-who-need-home-and-community-based-services-supporting-independent-living-and-community-integration/.

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  7. See generally Kaiser Commission on Medicaid and the Uninsured, Medicaid Long-Term Services and Supports: Key Considerations for Successful Transitions from Fee-for-Service to Capitated Managed Care Programs (April 2013), https://www.kff.org/medicaid/issue-brief/medicaid-long-term-services-and-supports-key-considerations-for-successful-transitions-fromfee-for-service-to-capitated-managed-care-programs/; Kaiser Commission on Medicaid and the Uninsured, People with Disabilities and Medicaid Managed Care: Key Issues to Consider (Feb. 2012), https://www.kff.org/medicaid/issue-brief/people-withdisabilities-and-medicaid-managed-care/; Kaiser Commission on Medicaid and the Uninsured, Examining Medicaid Managed Long-Term Service and Support Programs: Key Issues to Consider (Oct. 2011), https://www.kff.org/medicaid/issue-brief/examiningmedicaid-managed-long-term-service-and/; see also National Council on Disability, Medicaid Managed Care for People with Disabilities: Policy and Implementation Considerations for State and Federal Policymakers (March 2013), http://www.ncd.gov/publications/2013/20130315/.

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  8. V. Smith et al., Implementing Coverage and Payment Initiatives:  Results from a 50-State Medicaid Budget Survey for State Fiscal Years 2016 and 2017 at 47 (Oct. 2016) (citing 23 states using private health plans to deliver LTSS), available at https://www.kff.org/medicaid/report/implementing-coverage-and-payment-initiatives-results-from-a-50-state-medicaid-budget-survey-for-state-fiscal-years-2016-and-2017/.  We also include a 24th state, Vermont, in which a state entity acting as a prepaid health plan delivers MLTSS on an at-risk basis.

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  9. Section 1115 demonstration waivers authorize “experimental, pilot, or demonstration projects” that, in the view of the Health and Human Services Secretary, “promote the objectives” of the Medicaid program. Section 1115 allows CMS to waive state compliance with certain provisions of federal Medicaid law and also may include expenditure authority through which states can receive federal matching funds for costs that otherwise would not qualify for Medicaid funding. Kaiser Commission on Medicaid and the Uninsured, Five Key Questions and Answers About Section 1115 Medicaid Waivers (June 2011), https://www.kff.org/health-reform/issue-brief/five-key-questions-and-answers-about-section/.

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  10. There were 289 individual § 1915 (c) waivers in 47 states and DC in 2013.  T. Ng et al., Medicaid Home and Community-Based Services Programs:  2013 Data Update (Oct. 2016), https://www.kff.org/medicaid/report/medicaid-home-and-community-based-services-programs-2013-data-update/.  For background about HCBS, see CMS/Mathematica Policy Research, The HCBS Taxonomy: A New Language for Classifying Home and Community-Based Services 4 MEDICARE & MEDICAID RESEARCH REVIEW E1-E17 (2014),  http://dx.doi.org/10.5600/mmrr.004.03.b01.

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  11. These surveys have been conducted with researchers at the University of California San Francisco.  See, e.g., T. Ng et al., Medicaid Home and Community-Based Services Programs:  2013 Data Update (Oct. 2016), https://www.kff.org/medicaid/report/medicaid-home-and-community-based-services-programs-2013-data-update/.

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  12. We exclude Kansas, which administers MLTSS through concurrent § 1115/1915 (c) waivers.

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  13. CMS, Medicaid Section 1115 Demonstrations, State Waivers List, https://www.medicaid.gov/medicaid/section-1115-demo/demonstration-and-waiver-list/waivers_faceted.html.

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  14. Section 1915 (b) allows allow CMS to waive state compliance with certain provisions of federal Medicaid law, such as those that otherwise require benefits to be provided statewide, comparability of benefits among different Medicaid populations, and beneficiaries’ free choice of provider.  Examples of states with joint § 1915 (b)/(c) capitated MLTSS waivers include Florida, Illinois, Iowa, Michigan, Minnesota, Ohio, and Wisconsin.

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  15. An exception is Kansas, which administers capitated MLTSS under concurrent § 1115/1915 (c) waivers.  See generally Kaiser Family Foundation, Medicaid Long-Term Services and Supports:  An Overview of Funding Authorities (Sept. 2013), https://www.kff.org/medicaid/fact-sheet/medicaid-long-term-services-and-supports-an-overview-of-funding-authorities/.

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  16. Section 1115 MLTSS waivers also usually include HCBS authorized under Medicaid state plan authority.  Medicaid state plan HCBS include home health, personal care, private duty nursing, physical therapy and related services, prosthetic devices, other rehabilitative services, case management, § 1915 (i) services (which are the same as those available under § 1915 (c) waivers), the § 1915 (j) self-direction option, and Community First Choice attendant care services and supports.  All of these services except home health are provided at state option.  Section 1915 (c) waiver services may include case management, homemaker/home health aide and personal care, adult day health, habilitation, respite care, other services approved by the HHS Secretary, and day treatment/partial hospitalization, psychosocial rehabilitation, and clinic services for individuals with chronic mental illness.

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  17. Other states are using § 1115 waivers to accomplish similar goals through fee-for-service delivery systems instead of capitated MLTSS.  For example, Minnesota’s § 1115 waiver expands access to HCBS in an effort to prevent beneficiaries from requiring future institutional care, and Washington has an agreement in principle with CMS to implement a § 1115 waiver that would expand HCBS while limiting access to nursing facility services.

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  18. States can set institutional and HCBS financial eligibility at 300% of SSI without waiver authority.

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  19. New York’s waiver also applies a special income standard when determining financial eligibility for people who are discharged from a nursing facility and would be eligible for HCBS via a spend down but for the spousal impoverishment rules. Specifically, New York determines financial eligibility for this population based on the HUD average fair market rent for the geographic region, reduced by 30% of the Medicaid income limit for an individual (which is considered to be available for housing costs).

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  20. The SSI asset limit for a couple is $3,000.

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  21. Rhode Island’s waiver also increases the personal needs allowance by $400 for beneficiaries in nursing facilities for 90 days who are transitioning to the community and who would be unable to afford a community placement without the increased funds.

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  22. States also can provide HCBS to beneficiaries who meet functional criteria that are less strict than those required to meet an institutional level of care under § 1915 (i) state plan authority.

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  23. With the implementation of its § 1115 MLTSS waiver, Delaware changed its NF LOC criteria to needing assistance with 2 ADLs, instead of the previous standard of 1 ADL, and established functional eligibility for HCBS for those at risk of institutionalization at 1 ADL.

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  24. All caps exclude the cost of minor home modifications.

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  25. Tennessee’s demonstration also grandfathers in other beneficiaries who were determined to be at risk of institutionalization under the state’s prior institutional level of care criteria.  A 2012 waiver amendment restricted the nursing facility level of care criteria and created an at risk group, which subsequently closed to new enrollment in 2015.  The institutional level of care criteria were revised again in 2014, and a new at risk group was defined.

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  26. For background on the Katie Beckett group, see M. O’Malley Watts, E. Cornachione, and M. Musumeci, Medicaid Financial Eligibility for Seniors and People with Disabilities in 2015 (March 2016), https://www.kff.org/medicaid/report/medicaid-financial-eligibility-for-seniors-and-people-with-disabilities-in-2015/.

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  27. Some states also use their § 1115 waivers to enroll beneficiaries without LTSS needs in managed care.  We report enrollment totals only for beneficiaries receiving MLTSS.

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  28. Enrollment in TN is limited to new Medicaid applicants.  For a profile of a TN man with I/DD waiting for HCBS, see M. Musumeci & E. Reaves, Medicaid Beneficiaries Who Need Home and Community-Based Services:  Supporting Independent Living and Community Integration (March, 2014), https://www.kff.org/report-section/medicaid-beneficiaries-who-need-home-and-community-based-services-beneficiary-profile_mark/.

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  29. See, e.g., Kaiser Family Foundation, Health Plan Enrollment in the Capitated Financial Alignment Demonstrations for Dual Eligible Beneficiaries (Aug. 2016), https://www.kff.org/medicaid/fact-sheet/health-plan-enrollment-in-the-capitated-financial-alignment-demonstrations-for-dual-eligible-beneficiaries/.

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  30. Tenn. Div. of Health Care Finance & Admin., TennCare II Extension Request at 7 (Dec. 22, 2015), https://www.medicaid.gov/Medicaid-CHIP-Program-Information/By-Topics/Waivers/1115/downloads/tn/ta-tenncare-ii-pa-12222015.pdf.

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  31. Id. at 38.

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  32. Hawaii QUEST Integration Section 1115 Quarterly Report at 6 (June 29, 2015), https://www.medicaid.gov/Medicaid-CHIP-Program-Information/By-Topics/Waivers/1115/downloads/hi/QUEST-Expanded/hi-quest-expanded-qtrly-rpt-jan-mar-2015.pdf.

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  33. In 2015, there were nearly 641,000 people waiting for § 1915 (c) waiver services in 35 states.  T. Ng et al., Medicaid Home and Community-Based Services Programs:  2013 Data Update (Oct. 2016), https://www.kff.org/medicaid/report/medicaid-home-and-community-based-services-programs-2013-data-update/.

     

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  34. Texas notes that everyone on its waiting list may not be eligible for services as eligibility is not determined until services are available.

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  35. Vermont uses a state entity to deliver Medicaid MLTSS instead of private health plans.

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  36. These beneficiaries may be required to enroll in “mainstream” Medicaid managed care plans if they opt out of the specialized behavioral health plans.

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  37.   J. Paradise & M. Musumeci, CMS’s Final Rule on Medicaid Managed Care: A Summary of Major Provisions, Kaiser Commission on Medicaid and the Uninsured (June 2016), https://www.kff.org/medicaid/issue-brief/cmss-final-rule-on-medicaid-managed-care-a-summary-of-major-provisions/.

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  38. Managed care enrollment is voluntary in Rhode Island, which offers only one health plan.  Health plan disenrollment is not applicable in Vermont, where a state entity delivers MLTSS.

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  39.   J. Paradise & M. Musumeci, CMS’s Final Rule on Medicaid Managed Care: A Summary of Major Provisions, Kaiser Commission on Medicaid and the Uninsured (June 2016), available at https://www.kff.org/medicaid/issue-brief/cmss-final-rule-on-medicaid-managed-care-a-summary-of-major-provisions/.

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  40. Spending totals include institutional services and HCBS but exclude administrative costs.

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  41. More detailed expenditure data are expected across states as of FY 2016, because CMS has begun requiring states to report Medicaid managed care spending in three categories: acute care, institutional LTSS, and non-institutional LTSS. S. Eiken, K. Sredl, B. Burwell, & P. Saucier, Medicaid Expenditures for Long-Term Services and Supports (LTSS) in FY 2014: Managed LTSS Reached 15 Percent of LTSS Spending, Truven Health Analytics (April 15, 2016), available at https://www.medicaid.gov/medicaid-chip-program-information/by-topics/long-term-services-and-supports/downloads/ltss-expenditures-2014.pdf.

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  42. The lack of affordable and accessible community-based housing is a major barrier to transitioning Medicaid beneficiaries from institutions to the community.  M. Musumeci and M. Watts, Lessons Learned from Eight Years of Supporting Institutional to Community Transitions Through Medicaid’s Money Follows the Person Demonstration, Kaiser Commission on Medicaid and the Uninsured (October 2015), available at https://www.kff.org/medicaid/perspective/lessons-learned-from-eight-years-of-supporting-institutional-to-community-transitions-through-medicaids-money-follows-the-person-demonstration/.    Medicaid can fund housing-related services, such as housing transition and tenancy sustaining services and collaborative activities to identify and secure housing resources.  CMS, Coverage of Housing-Related Activities and Services for Individuals with Disabilities (June 26, 2015), https://www.medicaid.gov/federal-policy-guidance/downloads/cib-06-26-2015.pdf.

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  43. New York also offers Medicaid expansion HCBS, for which eligibility is similar to benefits provided under a § 1915 (c) HCBS wavier.  These services include assistive technology, community integration counseling and services, community transition services, congregate/home delivered meals, environmental modifications, home and community support services, home maintenance, home visits by medical personnel, independent living skills training, intensive behavioral programs, medical social services, moving assistance, nutritional counseling/education, peer mentoring, positive behavioral interventions, respiratory therapy, respite care, service coordination, social day care, structured day programs, substance abuse programs, transportation, and wellness counseling services.

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  44. For initial eligibility, Texas beneficiaries must have a service plan that meets the cost limit.

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  45. For more information about Tennessee, see M. Watts, E. Reaves, & M. Musumeci, Tennessee’s Money Follows the Person Demonstration:  Supporting Rebalancing in a Managed Long-Term Services and Supports Model (April 2014), https://www.kff.org/medicaid/issue-brief/tennessees-money-follows-the-person-demonstration-supporting-rebalancing-in-a-managed-long-term-services-and-supports-model/; M. Watts, E. Reaves, & M. Musumeci, Money Follows the Person Demonstration Program:  Helping Medicaid Beneficiaries Move Back Home (April 2014) (profiles two TN MFP beneficiaries), https://www.kff.org/medicaid/issue-brief/money-follows-the-person-demonstration-program-helping-medicaid-beneficiaries-move-back-home/.

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  46. MFP funding expired in September 2016, although states have until 2020 to spend their remaining funds. See generally M. Musumeci and M. Watts, Lessons Learned from Eight Years of Supporting Institutional to Community Transitions Through Medicaid’s Money Follows the Person Demonstration, Kaiser Commission on Medicaid and the Uninsured (October 2015), available at https://www.kff.org/medicaid/perspective/lessons-learned-from-eight-years-of-supporting-institutional-to-community-transitions-through-medicaids-money-follows-the-person-demonstration/.

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  47. See generally M. Musumeci, Measuring Long-Term Services and Supports Rebalancing (Feb. 2, 2015), https://www.kff.org/medicaid/fact-sheet/measuring-long-term-services-and-supports-rebalancing/; M. Musumeci, Rebalancing in Capitated Medicaid Managed Long-Term Services and Supports Programs:  Key Issues from a Roundtable Discussion on Measuring Performance (Feb. 2015), https://www.kff.org/medicaid/issue-brief/rebalancing-in-capitated-medicaid-managed-long-term-services-and-supports-programs-key-issues-from-a-roundtable-discussion-on-measuring-performance/.  In September, 2016, the National Quality Forum issued a final report on performance measure gaps in HCBS, including a list of characteristics describing high quality HCBS and a measurement framework.  National Quality Forum, Measuring HCBS Quality, http://www.qualityforum.org/Measuring_HCBS_Quality.aspx. 

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  48. Delaware also is listed as participating on http://nci-ad.org/ but did not indicate this in its survey response.

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  49. J. Paradise & M. Musumeci, CMS’s Final Rule on Medicaid Managed Care: A Summary of Major Provisions, Kaiser Commission on Medicaid and the Uninsured (June 2016), https://www.kff.org/medicaid/issue-brief/cmss-final-rule-on-medicaid-managed-care-a-summary-of-major-provisions/.

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  50. Id. 

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  51. Id. 

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  52. Id. 

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