Reimbursement Rates under the Medicaid Home and Community Based Services Waivers

Overview of Home and Community Based Services Waivers

The Medicaid Home and Community Based Services (HCBS) waiver program is authorized under Section 1915(c) of the Social Security Act. Through the HCBS waiver program, a Medicaid beneficiary can receive a wide range of services designed to allow the individual to live in their home or community and avoid institutionalized care.

Services under the HCBS waiver program may be a combination of standard medical services and non-medical services. Standard services may include, but are not limited to:

• Case management (support and service coordination);
• In-home care (home health aide and personal care attendants); and
• Habilitation services (both day and residential).

Currently, 47 states, including Kansas, and the District of Columbia have HCBS waivers approved with the Centers for Medicare and Medicaid Services (CMS). The only states that currently do not have an approved 1915(c) waiver with CMS are Arizona, Rhode Island, and Vermont.

HCBS Waivers in Kansas

Currently, KanCare allows the State to administer all its HCBS waiver services through managed care. There are seven separate 1915(c) HCBS waivers: Autism (AU), Frail Elderly (FE), Intellectual and Developmental Disability (I/DD), Physical Disability (PD), Serious Emotional Disturbance (SED), Technology Assisted (TA), and Brain Injury (BI).

To participate in a HCBS waiver, the individual requiring services must be financially and functionally eligible for Medicaid. Individuals with income above $1,177 a month must share in the cost of care, called the “client obligation.” The client obligation is paid directly by the client to a medical provider, not to the State of Kansas nor to a KanCare Managed Care Organization (MCO).

Individuals on the HCBS waivers receive services through individual providers, contracted through MCOs. Those providers are then reimbursed through KanCare for providing those services. Each service has a different category with different rates. Due to rising costs to provide these services, there have been efforts to increase the rates at which HCBS services are reimbursed. Additional information for each of the seven HCBS waivers follows.

Autism (AU)

The AU waiver provides services to children who have been diagnosed with Autism Spectrum Disorder, Asperger’s syndrome, or pervasive developmental disorder not otherwise specified. Children are eligible for services from the time of diagnosis until their sixth birthday. Autism services are limited to three years; however, an additional year may be submitted for approval.

The AU waiver generally has five service categories, which represent different therapy services and respite care. The current rates range from $3.26 to $10.87 per 15-minute increment.

Frail Elderly (FE)

The FE waiver provides home and community based services to Kansas seniors as an alternative to nursing facility care. The waiver serves those individuals 65 and older who meet the Medicaid nursing facility threshold score and are financially eligible for Medicaid.

The FE waiver has approximately 17 service categories, which generally represent various personal care services and life management services. Services vary in reimbursement frequency and range from 15-minute increments for personal care services to once-a-month for more specialized services.

For more-frequent services, the rates range from $2.96 to $4.49 per 15-minute increment. Less-frequent services range from $17.30 to $125.04 per occurrence. These types of services range from medication reminders to financial management services.

Intellectual and Developmental Disability (I/DD)

The I/DD waiver provides services to individuals five years of age and older who meet the definition of intellectual disability, have a developmental disability, or are eligible for care in an intermediate care facility for individuals with intellectual disabilities. Those with a developmental disability may be eligible if their disability was present before age 22 and they have a substantial limitation in 3 areas of life functioning.

Services for the I/DD waiver are divided into approximately 14 service categories, which generally represent various personal care services and life management services. Services vary in reimbursement frequency and range from 15-minute increments for personal care services to once-a-month for more specialized services.

For more-frequent services, the rates range from $3.34 to $8.16 per 15-minute increment. Less-frequent services range from $16.31 to $125.04 per occurrence. These types of services range from medication reminders to financial management services.
Two common services are residential supports and day supports, which are each divided into tiered rates. Residential supports rates are reimbursed per day. These rates range from $46.14 to $208.81. Day supports are reimbursed in 15-minute increments. These rates range from $2.01 to $6.47.

Physical Disability (PD)

The PD waiver provides services to individuals 16 to 64 years of age who meet the criteria for nursing facility placement due to their physical disability, have been determined disabled by the Social Security Administration, and need assistance to perform activities of daily living.

The PD waiver has approximately 17 service categories, which generally represent personal care and life management services. Services vary in reimbursement frequency and range from 15-minute increments for personal care services to once-a-month for more specialized services.

Personal care services are generally reimbursed at $3.08 to $3.56 per 15-minute increment. Home-delivered meals are reimbursed at $6.04 per meal. Less-frequent services range from $17.30 to $125.04 per occurrence. These types of services range from medication reminders to financial management services.

Serious Emotional Disturbance (SED)

The SED waiver provides services to individuals ages 4 to 18 who have been diagnosed with a mental health condition that substantially disrupts the individual’s ability to function socially, academically, or emotionally. The waiver is designed to divert the individual from psychiatric hospitalization to intensive home and community based supportive services.

The SED waiver has approximately seven service categories, which represent various therapy types and respite care. These services are generally reimbursed at $3.26 to $21.75 per 15-minute increment.

Technology Assisted (TA)

The TA waiver provides services to people through the age of 21 who require substantial and ongoing daily care by a nurse comparable to the level of care provided in a hospital.

The TA waiver has approximately seven service categories, which represent various attendant care services. These services are generally reimbursed at $3.61 to $8.70 per 15-minute increment. The TA waiver includes a few less- frequent services, such as health maintenance monitoring and financial management services, which are reimbursed at $76.11 per visit and $125.04 per month, respectively.

Brain Injury (BI)

The Brain Injury (BI) Waiver is a habilitative/rehabilitation and independent living program with an emphasis on the development of new independent living skills and/or relearning of lost independent living skills due to an acquired or traumatic brain injury.

The BI waiver has approximately 16 service categories, which generally represent various personal care services and life management services. Services vary in reimbursement frequency and range from 15-minute increments for personal care services to once-a-month for more specialized services.

For more-frequent services, the rates range from $3.24 to $18.99 per fifteen-minute increment. Less-frequent services range from $17.30 to $125.04 per occurrence. These types of services range from medication reminders to financial management services.

Recent Changes in Provider Reimbursement Rates

Services through the HCBS waiver program are provided by a contracted entity, which is subsequently reimbursed for its services. Over the years, there has been an effort to increase reimbursement.

2019 Legislative Session

During the 2019 Legislative Session, the Kansas Department for Aging and Disability Services (KDADS) requested additional funding to increase the reimbursement rates for the BI waiver for FY 2020. The request did not make it into the Governor’s Budget Recommendation.

During the Legislative Session, both the House Committee on Social Services Budget and the Senate Committee on Ways and Means Social Services Subcommittee considered providing rate increases for all waiver categories. During deliberations on the budget, the two chambers agreed on an increase of 1.5 percent for all waivers. This increase was included in SB 25, the 2019 appropriations bill.

The effect of this increase was wide, ranging from a several cent increase for some non-specialized care services to a dollar increase for the more specialized care services.

2020 Legislative Session

During the 2020 Legislative Session, KDADS specifically requested an increase for both the TA and BI waivers. The increases did not make it into the Governor’s Budget Recommendation.

The Legislature considered a rate increase for the Specialized Medical Care (T1000) service code for the TA waiver, taking it from its current rate of $31.55 to $37.00 per 15-minute increment. As a result, the Legislature added $6.4 million, including $2.7 million from the State General Fund (SGF), in SB 66, the 2020 appropriations bill, to increase the rate for that specific service code.

Additionally, 2020 SB 348 and 2020 HB 2550 were introduced. These bills would have increased the reimbursement rates for the I/DD waiver over the course of three years, with a set yearly increase beginning in fiscal year (FY)The bills were heard in the Senate Committee on Ways and Means and the House Committee on Social Services Budget.
While the bills did not advance beyond hearings in either committee, the Legislature added $22.1 million, including $9.0 million from the SGF, for a 5.0 percent increase in I/DD waiver services in FY 2021.

COVID-19 Pandemic and the June 25 Governor’s Allotment Plan

On June 25, 2020, the Governor released her allotment plan due to projected shortfalls in state revenue resulting from the COVID-19 pandemic. The plan included several items added by the Legislature during the 2020 session being removed from the approved budget.

Among those items were:

• $9.0 million, from the SGF, for the 5.0 percent increase to provide reimbursement rate increases in I/DD waiver services; and
• $2.6 million, from the SGF, for the increase to $37.00 in the Specialized Medical Care (T1000) service code for the TA waiver.

The effect of the Governor’s allotment plan was to remove the SGF contribution for these items. Since the SGF contribution would have been used to draw down additional federal funds, these allotments also resulted in the additional loss of:

• $13.2 million, in matching federal funds, for the 5.0 percent increase to provide reimbursement rate increases in I/DD waiver services; and
• $3.8 million, in matching federal funds, for the increase to $37.00 in the Specialized Medical Care (T1000) service code for the TA waiver.

These funds were removed from the budget; the reimbursement rates effectively remain at the FY 2020 levels for FY 2021.