HHS allots $4 billion to move Medicaid recipients out of institutions

HHS has announced more than $4 billion in available funding from two programs in the health reform law to help move Medicaid beneficiaries out of institutions and into their own homes or other community settings.

On Tuesday, HHS Secretary Kathleen Sebelius said 13 states—Colorado, Florida, Idaho, Maine, Massachusetts, Minnesota, Mississippi, Nevada, New Mexico, Rhode Island, Tennessee, Vermont and West Virginia—will receive a total of $45 million to start the “Money Follows the Person,” or MFP, demonstration program, which was scheduled to expire this year but was extended for five years through the Patient Protection and Affordable Care Act. These 13 states will join the 29 states and the District of Columbia, which are already participants in the program. A total of $621 million has been committed through 2016, according to HHS. In a news release, CMS Administrator Donald Berwick called the program “hugely important” because it allows Medicaid beneficiaries who had been living in institutions to “become full participants in the activities most of us take for granted.”

Meanwhile, HHS said the goals of the MFP program align with the Community First Choice Option, which the Affordable Care Act created. The goal of this program is to give states additional resources to make community living a first choice for Medicaid beneficiaries, while leaving nursing homes and institutions as a “fall-back” option. As outlined in new rules from HHS (PDF), this option will allow states to receive a 6% increase in federal matching funds for providing community-based, attendant services and support to Medicaid beneficiaries starting in October. Between now and 2014, states could receive a total of $3.7 billion in new funds to provide these services. To qualify for the increased federal funding, states must develop so-called person-centered plans that allow individuals to determine how services are provided to achieve or maintain independence.

“States must also establish implementation councils with a majority membership consisting of persons with disabilities, elderly individuals and their representatives to advise in the design and implementation of Community First Choice Option,” the agency said in a news release.