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 CMS Gives States Extra Three Years to Comply with HCBS Reforms

​The Centers for Medicare & Medicaid Services (CMS) has given states three additional years from the year 2019 to the year 2022 to comply with new regulations governing the administration of home and community-based services (HCBS) under the Medicaid waiver programs, a move that was supported by advocates for the assisted living (AL) sector.

In a May 9 bulletin from Brian Neale, director of Medicaid and CHIP Services under CMS, the agency said in rolling back the transition deadline it recognizes the complexity for stakeholders to meet the final HCBS regulations.

“In recognition of the significance of the reform efforts underway, CMS intends to continue to work with states on their transition plans for settings that were operating before March 17, 2014, to enable states to achieve compliance with the settings criteria beyond 2019,” he said. While states should continue to work toward final Statewide Transition Plan approval by March 17, 2019, CMS will now “extend the transition period for states to demonstrate compliance…until March 17, 2022, for settings in which a transition period applies. We anticipate that this additional three years will be helpful to states to ensure compliance activities are collaborative, transparent and timely,” Neale said.

At issue is states meeting the new standards of a final HCBS rule from January 2014. In that document, CMS created new criteria for appropriate home and community-based settings for Medicaid beneficiaries as an alternative to traditional settings of care. That care in the home and community-based setting could be in danger of losing its Medicaid reimbursement status under provisions of the HCBS final rule, but specific interpretation of the rule is still being worked out.

AL industry reaction from NCAL -- the National Center for Assisted Living (part of the American Health Care Association (AHCA) -- was positive while noting much work needs to be done in implementing the new HCBS rule.

“NCAL appreciates the flexibility CMS is granting states to make certain that implementation of the HCBS Final Rule is accomplished in a thoughtful, collaborative way. We must get this rule right to ensure that assisted living remains a home and community-based option for vulnerable seniors who rely on Medicaid and consider these communities to be their home. NCAL looks forward continuing this conversation with CMS and states,” said Scott Tittle, executive director of NCAL.

In his letter, Neale said Health and Human Services (HHS) Secretary Thomas Price, MD and CMS Administrator Seema Verma, set out the need for flexibility across the Medicaid program in their own letter to state governors dated March 14.

The Price and Verma letter cited the possibility for CMS to provide additional time for states to comply with the HCBS final rule. “Additionally, we will be examining ways in which we can improve our engagement with states on the implementation of the HCBS rule, including greater state involvement in the process of assessing compliance of specific settings,” Price and Verma said.

Lilly Hummel, senior director of policy for NCAL, says the March letter and this latest move by CMS to extend the transition period three years is a positive move as the new administration begins its work. “This shows that HHS/CMS are willing to work with stakeholders to get it right. The extension is a great step forward and may be part of a movement to act on other Medicaid rules and regulations,” she says.

And, while the HCBS rule particularly affects AL providers, language in the regulation could impact skilled nursing centers that offer adult day care services in their buildings and providers in the intellectual and developmental disabilities (ID/DD) space, Hummel adds.
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