State Assisted Living Policy: 1998. Current State Activity: Use of Waivers and State Plan Services

06/01/1998

Describing coverage of assisted living by state Medicaid programs, like many aspects of assisted living, is complex. Coverage can be presented by licensing terms (assisted living or board-and-care), current and planned coverage, and source of coverage (Medicaid state plan or waiver services).

By June of 1998, 28 states covered services in assisted living and board-and-care facilities and nine more planned to do so. Twenty states reimbursed services in facilities licensed as assisted living or designated as assisted living by Medicaid, and eight states covered personal care services in board-and-care facilities that are sometimes considered assisted living. The eight states planning to add coverage will license assisted living facilities.

When presented by type of coverage and current and planned coverage, the number of states totals 37, although Maine and Vermont are counted twice. Maine, which licenses several categories of assisted living, covers services in residential care facilities under its state plan. Services in congregate housing can be covered by a Medicaid waiver. Vermont presently covers care in residential care facilities under its waiver and plans to add assisted living when draft regulations are final.

Twenty-two states now have an assisted living licensing category, although not all the states reimburse services for Medicaid beneficiaries. Other states reimburse for services in facilities licensed as board-and-care facilities, and still others have created assisted living as a Medicaid reimbursed service even though the state may not have an assisted living licensing category (Minnesota, New Mexico, New York, Texas, Washington). The table below presents the three categories of arrangements states have implemented: those with assisted living as a licensing category or a term developed by Medicaid; those that cover services in board-and-care facilities; and those that do not use Medicaid to pay for services in either assisted living or board-and-care facilities.

States that use or plan to use Medicaid reimbursements for assisted living are divided among three categories: states with approved waivers; states planning to seek waiver approval for assisted living; and states using the state plan to pay for care. Board-and-care reimbursement is divided between states using the waiver and those using state plan services.

TABLE 6. Medicaid Reimbursement Arrangements

Assisted Living Board-and-Care1   No Coverage (14)  
  Waiver (18)     Pending (9)     State Plan (4)     Waiver (5)     State Plan (2)  
AK
AZ
FL
IA
KS
  ME2  
  MD  
MN
NJ
NM
ND
OR
  RI  
SD
TX
VA
WA
WI
  CT  
DE
HI
IL
LA
NE
NH
UT
  VT2  
  ME2  
MA
NY
NC
CO
GA
MT
NV
  VT2 
  AR  
MO
  AL  
CA
KY
ID
IN
  MI  
MS
OH
OK
PA
  SC  
TN
WV
WY
  1. These states do not have a licensing category named assisted living.
  2. Maine, using a broad definition of assisted living, uses the state plan and an HCBS waiver. Vermont covers services in residential care facilities and plans to add coverage for assisted living when its new rules take effect.

Although 28 states cover services in assisted living or board-and-care, total participation is just over 40,000 beneficiaries and waiver participation is very low in many states. States using personal care under the state plan to cover care have higher participation rates than states using the waiver. For example, roughly half of all Medicaid beneficiaries nationwide in assisted living or other residential care settings are in North Carolina, and another 25% are in Missouri and New York. Waiver participation is much lower. In 1998, Nevada had approximately 52 recipients participating in the waiver. New Jersey, which is approved for 1,500 participants, has 119 participants. Oregon, Virginia, and Washington have 1,400-1,500 each, and New York has approximately 2,100 participants. It is not clear why participation is low although observers speculate that primary referral sources and eligibility assessors may not be familiar with this new model. Facilities themselves may be slow to sign contracts with Medicaid over concern for the rate of payment or fears that additional regulations will be imposed and future increases may not be adequate. Further work is necessary to determine whether these or other factors contribute to the slower than expected participation rates.

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