Understanding Medicaid Home and Community Services: A Primer, 2010 Edition. Federal Medicaid Statutory Authorities


There are five principal Medicaid authorities under which states may implement participant direction of home and community services. (A sixth authority--a §1115 waiver--is available under certain conditions18 [see Box].)

Four of the five are Medicaid State Plan authorities. A state can add participant direction options under the State Plan by submitting a State Plan amendment to CMS for review and approval. Once approved, it becomes part of the state’s Medicaid program unless subsequently altered by the state. The fifth is a waiver authority, that is, states can request waivers of Federal statutory provisions in order to furnish services in a fashion not otherwise permitted under the Medicaid State Plan.

Section 1115 Waivers19

Before the enactment of the §1915(j) authority, Federal law did not easily accommodate the incorporation of the full range of participant direction options into the delivery of personal care services furnished through the Medicaid State Plan. As a consequence, the §1115 authority had to be invoked when a state was interested in implementing a wide-ranging participant direction option (including budget authority) for State Plan personal care services.20

With the availability of the §1915(j) and other authorities for implementing participant direction options, states now have little or no reason to invoke the §1115 waiver authority solely to initiate a participant-directed services option for Medicaid HCBS except in so far as participant direction is a component of a broader Medicaid reform proposal. As a general matter, §1115 waivers may only be used to test service delivery approaches that are not otherwise feasible under Medicaid law.

Table 7-1 summarizes the key features of participant direction programs under four of the five principal Medicaid authorities. The remainder of this section describes the basic scope of each authority and how it can be applied with respect to participant direction.

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