Understanding Medicaid Home and Community Services: A Primer, 2010 Edition. Personal Care/Personal Assistance


Prior to enactment of the Omnibus Reconciliation Act of 1993 (OBRA 93), personal care services offered through the State Plan were limited in scope and had a medical orientation, due to the requirement that they be authorized by a physician and supervised by a nurse. OBRA 93--together with implementing regulations effective in November 1997--gave states the option to substantially broaden the scope of personal care services to furnish individuals a wide range of assistance in everyday activities, both in and outside their homes.12

In January 1999, CMS released a State Medicaid Manual Transmittal that updated the guidelines concerning coverage of personal care services. In it, CMS made clear that (a) personal care services include assistance with both ADLs and IADLs, and (b) personal care for people with cognitive impairments may include cueing along with supervision to ensure the individuals perform the task properly. Formerly, such supervision generally was considered outside the scope of personal care. (See the Resources section of this chapter for a link to the Medicaid Manual.)

A state may now extend such services to include supervision and assistance to people with cognitive impairments, which can include people with mental illness, intellectual disabilities, and dementia. However, this supervision and assistance must be related directly to the performance of ADLs and IADLs. Companionship or custodial observation of an individual, absent hands-on or cueing assistance that is necessary and directly related to ADLs or IADLs, is not a Medicaid personal care service.

Specific provisions in the Manual are discussed next.

Scope of services--Personal care services covered under a state’s program may include a range of human assistance provided to people with disabilities and chronic conditions of all ages, which enables them to accomplish tasks they would normally do for themselves if they did not have a disability. Assistance may be in the form of hands-on assistance (actually performing a personal care task for a person) or cueing so that a person performs the tasks by him/herself. Such assistance most often relates to performance of ADLs and IADLs . . . Personal care services can be provided on a continuing basis or on episodic occasions. Skilled services that may be performed only by a health professional are not considered personal care services.

However, skilled services may be provided under the State Plan Personal Care benefit when delegated by a licensed nurse in accordance with state law.

Cognitive impairments--An individual may be physically capable of performing ADLs and IADLs but may have limitations in performing these activities because [of] a cognitive impairment . . . Personal care services may be required because a cognitive impairment prevents an individual from knowing when or how to carry out the task. For example, an individual may no longer be able to dress without someone to cue him or her on how to do so. In such cases, personal assistance may include cueing along with supervision to ensure that the individual performs the task properly.

In October 1999, CMS further revised the Manual to permit states to offer the option of consumer-directed personal care services (also called self-direction or participant direction). The Manual revisions explicitly recognized that individuals who are receiving personal assistance may direct their workers, that is, train, supervise, manage, and dismiss them (if needed). In particular, the Manual states the following:

Consumer-directed services--A state may employ a consumer-directed service delivery model to provide personal care services under the Personal Care optional benefit to individuals in need of personal assistance, including people with cognitive impairments, who have the ability and desire to manage their own care.

See the discussion later in this chapter--and in Chapter 7--about the §1915(j) State Plan authority, which expands participant direction service delivery options for both the State Plan Personal Care benefit and HCBS waiver programs.

These Manual materials describe a comprehensive scope of personal care/assistance that a state may choose to cover under its Medicaid State Plan--in keeping with contemporary views concerning the role personal assistance can play in supporting individuals with disabilities in a wide range of everyday activities.

As a result of the changes made in Federal policy, there is now little difference in the scope of personal care services that may be offered under the Medicaid State Plan and those that may be offered under an HCBS waiver program. However, neither the provisions of OBRA 93 nor the revised Federal regulations and CMS State Medicaid Manual guidelines require a state to change the scope of its pre-1993 coverage. In order to take advantage of these changes, a state must file an amendment to its Medicaid State Plan.

Targeted Case Management Services

States have the option of covering case management services for a defined group of Medicaid recipients, or for multiple groups, as long as different provisions apply to each specified group (hence, the term “targeted”).13 Targeted case management services are exempt from the comparability requirement, that is, they do not have to be available to all Medicaid beneficiaries. They can also be offered on a less than statewide basis.14

For example, a state may offer one form of targeted case management services to recipients who have a mental illness and another to people who are elderly and have physical impairments. States may use their own definitions to define target groups and may do so broadly (e.g., all Medicaid-eligible individuals with a developmental disability) or more narrowly (e.g., Medicaid-eligible individuals with a developmental disability who also have a mental illness). Other target groups states have established include

  • Adults with serious mental illness as defined by the state.

  • Children from birth to age 3 who are experiencing developmental delays or behavioral disorders as measured and verified by diagnostic instruments and procedures.

  • Pregnant women and infants up to age 1.

  • Individuals 60 years of age or older who have two or more physical or mental diagnoses that result in a need for two or more services.

  • Individuals with AIDS or HIV-related disorders.

  • People being transitioned from nursing homes to the community.

  • Individuals enrolled in HCBS waiver programs.

Although the targeting aspects of this case management coverage make it somewhat akin to the HCBS waiver program, there is one important difference. Once a state has established its target population and geographic locations, targeted case management services must be furnished to all eligible individuals. A state may not limit the number of eligible individuals who may receive these services.

States do have the option of limiting the entities that may furnish targeted case management services to individuals with a developmental disability or a mental illness to enable them to tie provision of these services to the “single point of entry” systems common in state service systems that serve these populations. Doing so enables states to maintain a unified service delivery approach.

The four components of targeted case management include assessment, service plan development, referrals, and monitoring. Targeted case management services can be described as “planning, linking, and monitoring” the provision of direct services and supports obtained from various sources (the Medicaid program itself, other public programs, and a wide variety of private sources), making their scope very broad. Permitted activities can include (1) assistance in obtaining food stamps, housing, and legal services; (2) service/support assessment and planning; and (3) monitoring the delivery of direct services and supports to ensure they are meeting individuals’ needs.

Although a range of activities on behalf of beneficiaries can be included within the scope of targeted case management, some cannot. In particular,

  • Activities related to authorization and approval of Medicaid services.15

  • Activities related to making basic Medicaid eligibility determinations.

  • Activities that constitute “direct services” to the consumer (e.g., transporting an individual to and from a doctor’s appointment is outside the scope of targeted case management).16

  • Activities provided to individuals in institutions. This restriction is based on two Federal provisions: (a) Federal regulations concerning Medicaid institutional services require that facilities provide care coordination services to residents, and (b) Medicaid prohibits duplicate payments for the same service. However, targeted case management services may be provided to residents of institutions in the last 180 consecutive days of a Medicaid-eligible person’s institutional stay, if provided for community transition. (See Chapter 6 for a discussion of Medicaid provisions related to transitioning from institutions to the community.)

  • Activities that overlap or duplicate similar services a person receives through other means (e.g., development of a service plan by an HCBS waiver case manager).

Other Medicaid options for covering case management services are discussed later in this chapter.

Clinic Services17

States have the option of covering specialized treatment services and other supports under several State Plan benefits. The two benefits that states most frequently cover are the optional Clinic benefit and the optional Rehabilitation benefit. States employ the Clinic benefit for a wide variety of purposes in their state Medicaid programs, including paying for services furnished through health care clinics and community mental health centers.

The Clinic benefit also serves as a means of paying for mental health services furnished to Medicaid beneficiaries on an outpatient basis. Mental health clinics may provide mental health therapy and other treatment to Medicaid beneficiaries--services needed by people who have serious and persistent mental illness and need long-term care services and supports to remain in their communities. The clinical services provided through the Clinic benefit must be site-based and supervised by a physician. (See the Resources section of this chapter for a web link to a publication on how to use Medicaid to provide services for adults with serious mental illness.)


The Rehabilitation benefit allows states more flexibility to design service packages than does the Clinic benefit, because of its broad definition in Federal regulation: “any medical or remedial services recommended by a physician or other licensed practitioner of the healing arts, within the scope of his practice under state law, for maximum reduction of physical or mental disabilities and restoration of a recipient to his/her best functional level.”

Rehabilitation services can include those that are also covered under the Clinic benefit. But unlike services under that option, they are portable (i.e., not limited to specific sites under the direct, on-site supervision of a physician). Many other services also fall within the scope of Rehabilitation. Psychiatric rehabilitation services include basic living skills training (including independent living skills and cognitive skills, as well as education regarding medications and medication management), social skills training, counseling and therapy, and collateral services, such as consultation with and training of family members, primary caretakers, providers, legal guardians or other representatives, and significant others. Such training and counseling is limited to activities that directly support the individual.19

Collateral services can be covered as a specific stand-alone category or as part of day treatment or intensive in-home services. Through this activity, reimbursement is provided for face-to-face encounters with people who are important in the beneficiary’s life, when those encounters are needed to develop or implement the rehabilitation plan. Psychiatric rehabilitation services are furnished in a variety of locations, including homes, partial hospitalization or day programs for adults, day treatment programs in schools or other locations for children, and residential placements (including facilities with fewer than 16 beds, such as group homes or therapeutic foster care homes). Crisis services and early intervention services, including services for very young children exhibiting signs of serious emotional disorders, are also furnished under this option.20

These services, along with personal care and targeted case management, can be combined to meet a wide range of service and support needs for people who have a mental illness. Of the 46 states that use the Rehabilitation benefit, many also provide targeted case management services to this population.21

The Clinic and Rehabilitation optional benefits are not generally used to provide long-term care services and supports to individuals with disabilities other than mental illness. During the 1970s and 1980s, a few states secured CMS approval to cover daytime services for people with developmental disabilities under either the Clinic or the Rehabilitation benefit. CMS ultimately ruled that the services being furnished were habilitative rather than rehabilitative and consequently could not be covered under either option in additional states.

However, Congress acted in 1989 to permit states that had secured CMS approval of these coverages to continue them but effectively prohibited other states from adding such coverage. The main basis for this ruling was that habilitative services could be furnished only to residents of intermediate care facilities for individuals with an intellectual disability (ICFs/ID) under the State Plan or through an HCBS waiver program for individuals who might otherwise be eligible for ICF/ID services. A few states have maintained their coverage of these services. But many have dismantled their coverages in favor of offering similar services through their HCBS waiver programs. With the creation of the new HCBS State Plan option under the §1915(i) authority, states may now cover habilitation under the State Plan.

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