Understanding Medicaid Home and Community Services: A Primer, 2010 Edition. Optional State Plan Services: Personal Care


Since the mid-1970s, states have had the option to offer personal care services under the Medicaid State Plan. This option was first established administratively under the Secretary’s authority to add coverages over and above those spelled out in §1905 of the Social Security Act, if such services would further the Social Security Act’s purposes. In 1993, Congress took the formal step of adding personal care to the list of services spelled out in the Medicaid statute.29 (See Chapter 4 for more information about the State Plan Personal Care benefit.)

When the Personal Care benefit option was created, it had a decidedly medical orientation. The services had to be prescribed by a physician, supervised by a registered nurse, and delivered in accordance with a service plan. Moreover, they could be provided only in a person’s place of residence. Generally, the personal care services a state offered were for assisting individuals to perform activities of daily living (ADLs)--bathing, dressing, eating, toileting, and transferring (e.g., from a bed to a chair). Personal care workers could provide other forms of assistance (e.g., housekeeping and laundry) only on a limited basis and only if they were incidental to the delivery of personal care services.

Starting in the late 1980s, some states sought to broaden the scope of personal care services and provide them outside the individual’s home in order to enable beneficiaries to participate in community activities. In 1993, when Congress formally incorporated personal care into Federal Medicaid law, it gave states explicit authorization to provide personal care outside an individual’s home.30 Congress went even a step further in 1994, allowing states to (1) use means other than nurse supervision to oversee the provision of personal care services, and (2) establish means other than physician prescription for authorizing such services. In November 1997, CMS issued new regulations concerning optional Medicaid State Plan personal care services to reflect these statutory changes.31

In January 1999, CMS released a State Medicaid Manual Transmittal that thoroughly revised and updated guidelines concerning coverage of personal care services. (See the Resources section of this chapter for web links to the Medicaid Manual.) New Manual materials make clear that personal care services may include assistance not only with ADLs but also with instrumental activities of daily living (IADLs), such as personal hygiene, light housework, laundry, meal preparation, transportation, grocery shopping, using the telephone, medication management, and money management. Additionally, the guidelines clarified that all relatives except “legally responsible relatives” (i.e., spouses, and parents of minor children) could be paid for providing personal care services to beneficiaries.

The Manual further clarified that, for persons with cognitive impairments, personal care may include “cueing along with supervision to ensure the individual performs the task properly.” It also explicitly recognized that the provision of personal care services may be directed by the people receiving them. Direction by participants includes training and supervising personal care attendants. The ability of participants to direct their personal care services has been a feature of many personal assistance programs for many years (both under Medicaid and in programs funded only with state dollars). For example, participant direction was built into the Massachusetts Medicaid Personal Care program from its inception. Taken together, these ground-breaking changes in Federal policy can help pave the way for a state to broaden coverage of these services. In order to take advantage of these changes, a state must amend its State Plan. Neither the statutory provisions nor the revised Federal regulations and State Medicaid Manual guidelines dictate that a state must change the scope of its pre-1993 personal care coverage.

In 2005, 36 states covered personal care services under their Medicaid State Plans.32 The most likely explanation for this less than national coverage is that some states have elected to cover personal care services through more flexible and easy to target HCBS waiver programs instead of adding the benefit to their State Plan. (See Chapter 4 for a discussion of the various options for covering personal care, including their advantages and drawbacks.)

The §1915(j) Authority. The DRA-2005 added §1915(j) to the Social Security Act, effective January 2007.33 This authority permits a state to institute an option for participants to have individual budgets to purchase non-traditional goods and services other than personal care to the extent that expenditures would otherwise be made for human assistance. It also allows states the option to disburse cash prospectively to participants who direct their services under the State Plan Personal Care benefit or an HCBS waiver program. Participants may also determine rates of pay for their workers, accumulate funds earmarked for the purchase of a specific item designed to increase independence or substitute for human assistance, and work with a fiscal intermediary to perform payroll and tax functions--called the “budget authority.” Absent the §1915(j) authority, participant direction of Medicaid State Plan personal care services is limited to hiring, supervising, and dismissing (if needed) their workers--called the “employer authority.”

States may use the §1915(j) authority only in programs alreadyoffered under its Medicaid State Plan or an HCBS waiver (i.e., states may not offer the specific participant-directed services options under the §1915(j) authority except in an existing State Plan Personal Care program or HCBS waiver program). (See Chapter 7 for a detailed description of this new authority and a discussion of participant-directed service options--also called self- or consumer-directed--that can be offered under several Medicaid authorities.)

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