LegiStorm

Summary:

Long-term services and supports (LTSS) refer to a broad range of health and health-related services and supports needed by individuals who lack the capacity for self-care due to a physical, cognitive, or mental disability or condition. Often the individual’s disability or condition results in the need for hands-on assistance or supervision over an extended period of time. Medicaid plays a key role in covering LTSS to aged and disabled individuals. As the largest single payer of LTSS in the United States, federal and state Medicaid spending accounted for $142.1 billion or 42.1% of all LTSS expenditures in 2014 ($337.3 billion). LTSS are also a substantial portion of spending within the Medicaid program relative to the population served, accounting for one-third (31.9%) of all Medicaid spending in 2014. Of the 69.2 million total enrolled Medicaid population, an estimated 4.3 million (or 6.2%) received LTSS in FY2012. Medicaid funds LTSS for eligible beneficiaries in both institutional and home and community-based settings, though the portfolio of services offered differs substantially by state. Moreover, states are required to offer certain Medicaid institutional services to eligible beneficiaries, while the majority of Medicaid home and community-based services (HCBS) are optional for states. In recent decades, federal authority has expanded to assist states in increasing and diversifying their Medicaid LTSS coverage to include HCBS. As a result, the share of Medicaid LTSS spending for HCBS has nearly tripled, accounting for 18% of Medicaid LTSS spending in 1995 to just over half (51%) of total Medicaid LTSS spending in 2013. States now have a broad range of coverage options to select from when designing their LTSS programs. In general, Medicaid law provides states with two broad authorities, which either cover certain LTSS as a benefit under the Medicaid state plan or cover home and community-based LTSS through a waiver program which permits states to disregard certain Medicaid requirements in the provision of these services, subject to approval. Given the range of available coverage options, states continue to enhance or expand their LTSS delivery systems to cover additional services or target services to specific populations with a focus on HCBS. In FY2014 and FY2015, the number of states reporting activities to expand HCBS increased to 42 and 47 states, respectively (compared to 26 states in FY2012 and 33 states in FY2013). Most states reported using Section 1915(c) HCBS waiver authority programs or the Section 1915(i) HCBS state plan option to expand their HCBS offerings. The Patient Protection and Affordable Care Act (ACA, P.L. 111-148, as amended) established or extended several Medicaid state plan options and grant activities to enhance or expand states’ LTSS delivery systems. In FY2013, 19 states reported having at least one of these activities in effect; 12 states reported implementing at least one of these activities in FY2014; and 15 states reported plans to implement in FY2015. This report provides a description of the various statutory authorities that either require or otherwise allow states to cover LTSS under Medicaid. Appendix A provides a brief legislative history of Medicaid LTSS from Medicaid’s enactment and initial coverage requirements for institutional care through the evolution of HCBS options available to states. A discussion of changes to Medicaid made by the Patient Protection and Affordable Care Act (ACA, P.L. 111-148, as amended) with respect to LTSS coverage options is also provided. The tables in Appendix B provide state information about coverage of Medicaid state plan optional benefits and certain grant programs to expand Medicaid HCBS.