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Medicaid News

Affordable Care Act Funds to Help States Move Medicaid Patients Back to Their Homes

$4.3 billion in new funds will expand community-based alternatives to institutional long term care

Feb. 23, 2011 - States will see significant new federal support, now and in the near future, in their efforts to help move Medicaid beneficiaries out of institutions and into their own homes or other community settings Health and Human Services (HHS) Secretary Kathleen Sebelius announced yesterday.

The Affordable Care Act provides additional funding for two programs supporting that goal, the Money Follows the Person (MFP) demonstration program and the Community First Choice Option program.

Secretary Sebelius said thirteen states would together receive more than $45 million in MFP grants to start that program in their states, with a total of $621 million committed through 2016.


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In addition, HHS has proposed rules to allow all states to access a potential of $3.7 billion in increased federal funding to provide long-term services and supports through the Community First Choice Option program.

“Our country recognized in the Americans with Disabilities Act that everyone who can live at home or community-based setting should be allowed to do so,” Secretary Sebelius said. “The Affordable Care Act provides states critical new dollars toward achieving that goal.”

Thirteen states Receive Money Follows the Person Program Grants

The Money Follows the Person (MFP) demonstration program, which was set to expire in fiscal year 2011, is extended through the Affordable Care Act for an additional five years. The 13 states receiving awards today (see list and award amounts below) join the 29 states and the District of Columbia already operating MFP programs. Together, these states will receive more than $45 million in the first year of the program, and more than $621 million through 2016.

The MFP program provides individuals living in a nursing home or other institution new opportunities to live in the community with the services and supports they need. Groups benefiting from these home-and-community based programs include the elderly, persons with intellectual, developmental and/or physical disabilities, mental illness or those diagnosed with several of these conditions. To date, these programs have helped 12,000 individuals move out of institutions and back into their communities. Today’s grants are expected to help an additional 13,000 people.

“The Money Follows the Person program is hugely important to improving the lives of Medicaid beneficiaries,” said Donald Berwick, M.D., administrator of the Centers for Medicare & Medicaid Services (CMS), which will implement the demonstration program.

“This helps bring everyone, even those who in the past may have had no choice but to live in an institution, into the community where they can become full participants in the activities most of us take for granted.”

New Community First Choice Option Available to states

Many of the same goals under the MFP demonstration are shared and supported by the Community First Choice (CFC) Option, created by the Affordable Care Act. Today, nursing homes and institutions are too often the first or only choice for people with Medicaid who need long term care. The goal of this new option is to give states additional resources to make community living a first choice, and leave nursing homes and institutions as a fall back option.

Starting in October, this option will allow states to receive a six percent increase in federal matching funds for providing community-based attendant services and supports to people with Medicaid. Over the next three years—through 2014—states could see a total of $3.7 billion in new funds to provide these services. states currently receive Federal Medicaid matching funds for these activities at the State’s normal matching rate.

Services and supports that can be provided under CFC include, but are not limited to, attendant services and supports that help individuals with activities of daily living such as bathing and eating, and health-related tasks through hands-on assistance or supervision. states may also cover costs related to moving individuals from an institution to the community, such as security and utility deposits, first month’s rent, and purchasing basic household supplies.

To qualify for the increased Federal funds, states must develop “person-centered plans” that allow the individual to determine how services are provided to achieve or maintain independence. states must also establish implementation councils with a majority membership consisting of persons with disabilities, elderly individuals and their representatives to advise in the design and implementation of Community First Choice option.

The proposed rule, posted yesterday, describes the details of this program and solicits public comment. The rule can be found at:

“There is more evidence than ever that people who need long-term care prefer to live in their own homes and communities whenever possible,” said Dr. Berwick. “To restrict these individuals to institutions where even the simplest decisions of the day such as when to get up, what to eat and when to sleep are made by someone else must no longer be the norm. This new Federal funding will make a difference in people’s lives.”


See below for the list of states receiving MFP grants today.

Money Follows the Person Grant Awardees



1st YR. Award

Funds committed through 2016

Colorado Colorado Department of Health Care Policy & Financing



Florida Florida Agency for Health Care Administration, Medicaid



Idaho Idaho Department of Health and Welfare, Division of Medicaid



Maine Maine Department of Health and Human Services



Massachusetts Massachusetts Executive Office of Health & Human Services, Office of Medicaid



Minnesota Department of Human Services



Mississippi Mississippi Division of Medicaid, Office of Health Services



Nevada Nevada Department of Health & Human Services, Division of Health Care Financing & Policy



New Mexico New Mexico Human Services Department, Medical Assistance Division, Long Term Services & Supports Bureau



Rhode Island Rhode Island Department of Human Services, Division of Health Care Quality, Financing & Purchasing / Medicaid Division



Tennessee Tennessee Bureau of TennCare



Vermont Department of Disabilities, Aging and Independent Living



West Virginia West Virginia Department of Health & Human Resources, Bureau for Medical Services







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