Home and Community-Based Services Funding in the American Rescue Plan Act
April 1, 2021 / COVID-19
Last month, Congress enacted the new federal COVID-19 relief package, the American Rescue Plan Act of 2021 (ARPA). This package includes a number of bills aimed to help Americans with the lasting effects of COVID-19. From $1,400 stimulus checks to increases in SNAP benefits, the package covers a multitude of issues that threaten Americans’ long-term recovery. For the disability-rights community, one piece of the package really stands out: additional funding for each state’s Home and Community-Based Services (HCBS) system.
Federal Match for HCBS Dollars
In Ohio, Medicaid’s HCBS is partially funded through state dollars, but the state also receives funds from the federal government. The American Rescue Plan Act includes a 10% increase in addition to the current federal medical assistance percentage (called FMAP) which matches a portion of Medicaid funds for each state. The main restriction with the FMAP increase is that the state must use these funds in addition to existing funding, not in place of it.
While only a one-time increase, the additional funding should bolster the state’s ability to provide home and community-based services. At this critical juncture in the pandemic, the importance of funding for community-based services cannot be understated. COVID-19 had a disproportionately negative impact on people living in long-term care facilities and other congregate or institutional settings. Bolstering the HCBS system will allow even more individuals to choose the care setting that works best for them.
Impact on Ohioans with Disabilities
The potential effects of this legislation are huge. The Kaiser Family Foundation estimates that Ohio could receive approximately $434 million dollars that would go towards HCBS in the state. But what does that really mean for Ohioans, and what all would that cover?
Federal funding for Medicaid HCBS is uniquely flexible: the only real requirement in the legislation is that the funding will “implement, or supplement the implementation of, one or more activities to enhance, expand, or strengthen” HCBS. Basically, the funding should go towards anything HCBS-related: provider wage increases, additional HCBS waivers, expanded services and much more.
This additional 10% increase in HCBS funding will last until March 31, 2022, and Ohio could begin using these funds as early as this month. However, states are still waiting for guidance about how this funding must be used. In the coming days, weeks, and months, we expect the federal Center for Medicare & Medicaid Services will likely put out restrictions for the additional funding. States are not required to draw down this increased funding; between that and the unknown restrictions on these funds, it’s not yet clear how much of this increase the HCBS system will see.
At this time, Ohio’s Department of Medicaid has not officially stated how they plan to use the funds. While many specifics remain unknown, the 10% increase should have a positive impact on Ohio’s HCBS system. To read more about the American Rescue Plan Act and its effects, check out these resources:
- Center for Public Representation’s Fact Sheet: American Rescue Plan Act and Disability Priorities
- Kaiser Family Foundation’s State-by-State Analysis
- National Health Law Program’s Blog: The American Rescue Plan: Major Relief for People with Disabilities
- Center on Budget and Policy Priorities’ Summaries: