Piggy bank with dollars around it, representing savings for states that expand Medicaid HCBS

Spending on Medicaid home- and community-based services (HCBS) totaled $115.8 billion in fiscal year 2020, according to a new report released Friday from the Kaiser Family Foundation. Waivers make up over two-thirds of total HCBS spending, while spending under a state plan authority is under one-third of total HCBS spending, the report said.

States continue to rebalance long-term services and supports (LTSS) spending toward home- and community-based LTSS, the report indicated. In fiscal year 2019, HCB LTSS made up 59% of total spending — the highest to date — while institutional LTSS comprised 41% of total spending.

The Kaiser Family Foundation released the report in light of a major HCBS bill stalled in Congress, the Build Back Better reconciliation package. This legislation would inject $150 billion in federal funds for Medicaid HCBS, including a permanent increase in federal matching funds for HCBS. The House passed the bill in November; the Senate has not passed it.

There are two HCBS authorities that allow states to provide services to specific populations of seniors and people with disabilities: Section 1915 (c) waivers and the Section 1915 (i) state plan option. Waiver spending totaled $80.1 billion in FY 2020, while state plan spending made up $35.7 billion of total Medicaid HCBS spending. Some 1.9 million receive Medicaid HCBS through Section 1915 (c ), while nearly 166,000 receive it through Section 1915 (i) state plan services. Among the state plan HCBS authorities, personal care services ($17.3 billion) and Community First Choice ($12.5 billion) accounted for the largest portion of spending, according to the report.

There was modest spending growth and modest changes from fiscal year 2019 to fiscal year 2020 in the number of people receiving HCBS, the report said. Some states that experienced growth in the number of people served and/or spending attributed the changes to the pandemic.

Waiver waiting lists

Most states report HCBS waiver waiting lists, totaling over 665,000 people nationally, another Kaiser Family Foundation report released Friday said. Seniors and adults with physical disabilities account for slightly more than one-quarter of total waiting lists. Nationally, individuals waited an average of 44 months to receive waiver services in FY 2020, according to the report.

Some of the most frequently offered waiver services across all states and target populations are home-based services and equipment/technology/modifications. Other frequently offered services are day services, nursing/therapy and case management.

The report also delved into reimbursement rates. The average provider reimbursement rate for home health agency services is $118.82 per visit in 20 states providing this data, according to the report. The average provider reimbursement rate paid to personal care agencies is $23.09 per hour in 22 states reporting this data.