How Much Do Home Care Providers Make – At the end of March 2021, the Biden Administration announced the American Jobs Plan, which includes $400 billion to expand access to Medicaid home and community services (HCBS) for seniors and people with disabilities and strengthen the direct care workforce. The Better Care for Better Jobs Act, recently introduced by Democratic lawmakers, sets out three provisions to implement the President’s HCBS proposal in the American Jobs Plan. The major provision is the “HCBS Infrastructure Improvement Program,” which offers enhanced permanent federal Medicaid matching funds for HCBS if states choose to participate and meet certain requirements. The other provisions would make Continuation of the Person’s Money and the requirement for states to apply spousal poverty protections to HCBS.

HCBS helps with self-care, such as eating and bathing, and household activities, such as preparing meals, for people who need help with these tasks due to health or functional needs. Most HCBS is provided through Medicaid and is not covered by other payers, including Medicare. Medicaid states can offer HCBS as a state plan benefit, which must be provided to all enrollees who qualify, and waivers, which allow states to target services to specific populations, expand income and asset limits, and set enrollment caps. The new proposal responds to increasing demands on HCBS resulting from the disproportionate number of COVID-19 cases and deaths among people in nursing homes and other community settings, the growing elderly population, and the unmet need for care community-based that preceded the pandemic.

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The proposal also aims to expand and strengthen caregiving jobs supported by Medicaid HCBS. Like people who rely on HCBS, the pandemic has disproportionately affected direct care workers who provide these services. The workforce is predominantly women, low paid, and people of color. Home care workers earned an average of $11.52 per hour, or $16,200 per year, in 2018. Despite the continued unmet need for HCBS, which is expected to grow with the growing senior population, states Labor shortages are regularly cited as a barrier to HCBS expansion. . This issue places the American Jobs Plan in the context of current Medicaid HCBS spending and considers how policymakers might allocate the new funding (Figure 1), drawing on provisions of the Better Care Better Jobs Act introduced with recently.

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Figure 1: Better Care Better Jobs Act Proposal for $400 Billion in New Federal Medicaid Home and Community Services

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Medicaid HCBS spending is estimated to be approximately $114 billion in FY 2021, before the increase from the American Rescue Plan Act (ARPA) (discussed below). Medicaid funds the majority (57%) of HCBS, with private insurance covering 12% and 7% paid out-of-pocket.1 State Medicaid programs must cover long-term services and supports (LTSS) in nursing homes, and the most HCBS is optional, resulting in significant variation across states. State HCBS programs face several challenges, including waiting lists for waiver services, direct care workforce shortages (which existed before the pandemic and have worsened), and a lack of affordable, accessible community-based housing . Nationally, community-based care accounts for more than half of Medicaid LTSS spending. Like other Medicaid services, costs are shared between the states and the federal government.

The ARPA provides an additional 10 percentage point increase in federal matching funds for state spending on HCBS from April 2021 through March 2022, an estimated $11.4 billion increase in federal spending nationally. Under ARPA, states must maintain their current spending levels and use the increased funds “to improve, expand, or strengthen HCBS. Because of the 1-year time limit on ARPA funds, states may be more likely to adopt policies to directly address the pandemic, such as providing hazard pay or overtime to direct care workers or offering targeted services such as home-delivered meals or assistive technology. , rather than dedicating funds to accommodate more HCBS enrollees in the long term.

The new $400 billion in federal funds from the American Jobs Plan proposal could increase annual spending on HCBS in Medicaid by at least 33%, and even more if state spending also increases. If the new funding were spread evenly over the next 10 years and allocated entirely through the Medicaid program, that would equate to new federal HCBS spending of $40 billion per year on top of the $114 billion baseline plus the $11.4 billion from ARPA.

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The Better Care Better Jobs Act, recently introduced by Democratic lawmakers, sets out three provisions to expand and strengthen Medicaid HCBS and the direct care workforce, as proposed in President Biden’s American Jobs Plan ( Figure 1). The major provision, which would be responsible for most of the funding, is the “HCBS Infrastructure Improvement Program,” which offers permanent federal Medicaid matching funds for HCBS if states choose to participate and meet certain requirements. The other provisions would make Continuation of the Person’s Money and the requirement for states to apply spousal poverty protections to HCBS.

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The HCBS Infrastructure Improvement Program proposed in the Better Care Better Jobs Act includes a permanent 10 percentage point increase in federal Medicaid matching funds for HCBS for states with plans approved by the Secretary to expand and strengthen HCBS.2 Similar to the temporary ARPA increase, the new increase stacks on top of other increases and will be capped at 95%. The new program is designed so that states could continue to access an additional 10 percentage point increase in federal funding for HCBS after the ARPA provision expires (Figure 2).

Figure 2: Availability of a 10 Percentage Point Increase in Federal Medicaid HCBS Funding as Proposed in the Better Care Better Jobs Act

The bill allows states to continue receiving a 10 percentage point increase in federal Medicaid matching funds for HCBS after the ARPA provision expires, as states develop their plans for the HCBS Infrastructure Improvement Program. States must continue to maintain existing HCBS eligibility and benefits while receiving the enhanced federal funds. The bill includes $100 million in state planning grants to be awarded within one year of enactment. The States would have two years to submit their plans, and it is up to the Secretary to approve plans as long as they are complete and there are assurances that the states will meet the requirements of the program. State plans must describe their current Medicaid HCBS program, how the state will meet annual measures and benchmarks, and the state’s goals for improving HCBS. Plans must consider people currently on Medicaid waiver waiting lists for HCBS as well as those who would be eligible but not currently on a waiting list and any HCBS provided in other states but not in the planning grants.

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States with Secretary-approved HCBS Infrastructure Improvement Plans could receive the 10 percentage point increase in federal matching funds for HCBS as they implement their plans. Specifically, states would need to continue to maintain existing HCBS eligibility and benefits as well as engage in activities to expand HCBS access, 3 strengthen the direct care workforce, 4 and monitor quality HCBS (Figure 3). States would also be required to provide an annual report on their HCBS program to the Secretary beginning in 5

Fiscal year of participation in the program. In addition, states would have to report on the following four benchmarks to continue receiving the enhanced federal funds after seven years of participation in the program:

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States with Secretary-approved plans may also receive additional federal matching funds to support self-directed and HCBS administrative costs. States that adopt a program to support self-direction may receive an additional two percentage point increase in federal matching funds for one year, capped at 95%. Activities of the self-directed program include offering a worker program and recruiting and training independent providers, engaging in quality oversight, coordinating with other state agencies and providers, establishing an “agency of choice” model, supporting family caregivers (if permitted by the state to be). paid suppliers), and ensure that state policies allow cooperation with organized labor or are neutral towards organized labor. Separately, all states with plans approved by the Secretary could receive enhanced federal funds for administrative costs, increased from 50% to 80%. Administrative costs may include data and technology infrastructure, modifications to rate setting processes, quality measures, worker training, and worker registries.

Expanding the Medicaid Money Follows the Person (MFP) program is the only specific policy proposal in the American Jobs Plan, and the Better Care Act would make MFP permanent. MFP provides enhanced federal matching funds that, from 2008 to 2019, helped more than 101,000 seniors and people with disabilities across 44 states and DC move from nursing homes to the community. States can fund services, such as first month’s rent and family start-up costs, and staff to help enrollees find community housing. Program evaluations have found improvements in enrollees’ quality of life and cost savings after moving from institutions to the community, although repeated short-term extensions have created uncertainty for states. Affordable and accessible housing for low-income seniors and people with disabilities remains scarce and hinders deinstitutionalization. Although Medicaid does not pay for housing, many states have used MFP funds to hire housing coordinators to work with affordable housing agencies and help enrollees find community housing. A federal evaluation of MFP showed approximately 5,000 new participants in each six-month period

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