DEPARTMENT OF HEALTH & HUMAN SERVICES 
Centers for Medicare & Medicaid Services 
7500 Security Boulevard, Mail Stop C2-21-15 
Baltimore, Maryland 21244-1850 
Center for Medicaid and State Operations 
SMDL #02-009 
May 9, 2002 
Dear State Medicaid Director: 
This letter transmits two template applications specifically designed to promote family or 
individual independence and choices regarding the selection of long-term care supports and 
services provided in the home.  The Independence Plus: A Demonstration Program for Family or 
Individual Directed Community Services Template applications, developed by the Centers for 
Medicaid and Medicaid Services (CMS), will assist states to create and fund such programs. 
While the templates are voluntary, the streamlined applications and approval process created by 
a standardized application will lessen the administrative burden on states and expedite the 
Federal review period. 
The template applications further the goals contained in President Bushs New Freedom 
Initiative and advances CMSs commitment to continue creating a culture of responsiveness. 
The intended purposes are specifically to: 
	 Delay institutional or other high cost out-of-home placement by strengthening supports to 
families or individuals and permit the individual who requires long-term supports and 
services to live in the family residence or their own home. 
	 Recognize the essential role of the family or individual in the planning and purchasing of 
health care supports and services by providing individuals or their families control over 
an agreed resource amount. 
  Encourage cost effective decision-making to purchase necessary supports and services. 
	 Increase family or individual satisfaction through the promotion of self direction, control 
and choice - a major theme expressed during the New Freedom Initiative - National 
Listening Session. 
	 Facilitate the states abilities to meet their legal obligations under the Americans with 
Disabilities Act (ADA) and the Supreme Court Olmstead decision. 
Two templates are available allowing states to choose different design features to satisfy their 
unique programs. For states wishing to create programs which combine target populations or 
allow Medicaid beneficiaries to maintain direct control over the resources available to them, the 
1115 Demonstration Template application is available.  For other program designs, the 1915(c) 
Waiver version is more appropriate.  A series of appendices are included in the 1915(c) Waiver 
version. Terms and conditions and an Excel spreadsheet to simplify the submission of data 
accompany the 1115 Demonstration version. 
The CMS website (www.cms.hhs.gov/medicaid) offers copies of the template applications.  Page 2  State Medicaid Director 
A notice will be published in the Federal Register on or around May 10, 2002. 
We invite public comment. Such comments will help us improve the templates.  After 
completion of the Paperwork Reduction Act review process, we will issue the final documents. 
States wishing to provide comments on the template applications may do so by directing an 
e-mail to: 
Selfdirectionwaiver@cms.hhs.gov (for 1915(c) Waiver comments) or 
Selfdirectiondemo@cms.hhs.gov (for 1115 Demonstration comments). 
Sincerely,

/s/

Dennis G. Smith

Director

Enclosures 
cc: 
CMS Regional Administrators 
CMS Associate Regional Administrators

for Medicaid and State Operations

Lee Partridge

Director, Health Policy Unit

American Public Human Services Association

Joy Wilson

Director, Health Committee

National Conference of State Legislatures

Matt Salo

Director of Health Legislation

National Governors Association

Brent Ewig

Senior Director, Access Policy

Association of State and Territorial Health Officials

Jim Frogue

Acting Director, Health and Human Services Task Force 

American Legislative Exchange Council

Trudi Matthews

Senior Health Policy Analyst

Council of State Governments
 Independence Plus 
A Demonstration Program for Family or 
Individual Directed 
Community Services Demonstration 
1115 of the Social Security Act 
Created by: 
Center for Medicaid and State Operations 
NOTE:  This document has not received OMB approval of the information 
collection pursuant to the Paperwork Reduction Act.  Table of Contents 
Template for Indepdendence Plus: 

A Demonstration Program for Family or Individual Directed Community Services

1115 Demonstration Proposal

I.  State Proposal Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

II.  General Description of Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 

III. Assurances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

IV. Waivers Requested . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

V.	 STATE SPECIFIC ELEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Target Population(s) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Geographic Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  6

Enrollment Cap . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Delivery System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

VI.  Budget Neutrality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7

VII. Additional Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  . . . . . 8

2
 Independence Plus 
A Demonstration Program for Family or Individual Directed Communit y 
Services 
1115 Demonstration Application 
I. State Proposal Information 
The State of ________________ , Department of _______________________ proposes an 1115 
Demonstration Proposal entitled ___________________________, which will allow Medicaid 
eligibles to arrange and purchase their own personal care and related services. 
The demonstration would operate for _____ years, beginning approximately ________. 
II. General Description of the Program 
The purpose of the program is to provide assistance for families with a member who requires 
long-term supports and services, or to individuals who require long-term supports and services, 
so that the individual may remain in the family residence or in their own home. 
The State has the flexibility to define a range of community-based services that will support 
families and individuals. Families and individuals will work with the State to identify, through a 
family or person-centered planning process. The State will maintain the ability to control costs 
and, in conjunction with individuals or families, establish mutual expectations regarding 
available resources. These resources will be identified through an established methodology, open 
for public inspection, for determining an individual budget that will be based upon actual service 
utilization data. Through the provision of services and supports identified through the plan of 
care and the operation of a quality assurance and improvement program, the State will ensure the 
health and welfare of the individuals in the program.  In addition, the program will provide 
assurances of fiscal integrity and include participant protections that will be effective and family-
friendly. 
III. Assurances 
The program design includes the following mandatory requirements (please check all to indicate 
assurance): 
_____ The program is voluntary for all eligible participants. 
_____	 A Fiscal/Employer Agent will be available to all participants that choose or need 
one based on a skills test. 
_____	 The State will conduct an evaluation of the program and will cooperate with an 
independent evaluation contractor CMS may procure. 
3
 _____	 The State will comply with public notice requirements as published in the Federal 
Register, Vol. 59, No. 186, dated September 29, 1994 (Document number 94 -
23960) and Centers for Medicare and Medicaid Services (CMS) requirements 
regarding Native American Tribe consultation. 
IV. Waivers Requested 
The following waivers are requested pursuant to the authority of Section 1115(a)(1) of the Social 
Security Act (Please check all applicable): 
_____Statewideness 1902(a)(1)  Accu  accumulate financial resources in a 
separate account for special 
To enable the State to operate the  (approved) purchases. 
demonstration within an area that does not 
include all political subdivisions of the 
State.  _____ Provider Agreements 1902(a)(27) 
_____ Comparability 1902(a)(10)(B)  To permit the provision of care by 
individuals who have not executed a 
To permit the state to offer demonstration  Provider Agreement with the State 
participants benefits that are not equal in  Medicaid agency. 
amount, duration, and scope to those 
offered to other Medicaid beneficiaries.  _____	 Direct Payments to Providers 
1902(a)(32) 
_____	 Income and Resource  To permit payments to be made directly to 
Rule 1902(a)(10)(C)(i)  beneficiaries or their representatives. 
To permit the exclusion of payments  _____ Payment Review 1902(a)(37)(B) 
received under the demonstration 
from the income and resource limits  To the extent that prepayment review may 
established under State and Federal  not be available for disbursements by 
law for Medicaid eligibility.  individual beneficiaries to their 
Beneficiaries will also be permitted to  caregivers/providers. 
4
 Section 1115(a)(2) authority of the Social Security Act is requested, for the following 
expenditures to be made by the State under the demonstration, (which are not otherwise 
included as expenditures under Section 1903) for the period of the demonstration to be 
regarded as expenditures under the States Title XIX plan. 
Note:  Checking the appropriate box(es) will allow the State to claim Federal Financial 
Participation for expenditures that otherwise would not be eligible for Federal match. 
_____	 Expenditures for demonstration caregiver services provided by members of the 
demonstration participants family to the participant. 
_____	 Expenditures to provide services that are not covered under the State Plan as 
demonstration services, i.e., to provide for training and fiscal/employer agent 
services as a part of the demonstration design. 
_____	 Expenditures for prepayment to demonstration participants for demonstration 
services prior to the delivery of those services. 
5
 V. STATE SPECIFIC ELEMENTS 
Target Population(s) 
All items that apply are checked: 
Category  CHILDREN  ADULTS  AGED 
AGE RANGE  AGE RANGE  AGE RANGE 
From  To  From  To  From 
AGED ONLY 
DISABLED (PHYSICAL) 
DISABLED (OTHER) 
BRAIN INJURY (ACQUIRED) 
BRAIN INJURY (TRAUMA) 
HIV/AIDS 
MEDICALLY FRAGILE 
TECHNOLOGY DEPENDENT 
AUTISM 
DEVELOPMENTAL DISABILITY 
MENTAL RETARDATION 
MENTAL ILLNESS 
Geographic Area  Delivery System 
_____  Statewide  Family members or legally responsible persons 
may qualify as providers? 
_____  One County or 
_____  Yes  _____  No 
_____	 Regional (Please specify areas to 
be included) 
_________________________________________  Beneficiaries will be permitted to invest resources 
in a special account for special (approved) 
_____  Other (Please specify)  purchases? 
_________________________________________  _____  Yes  _____  No 
Enrollment Cap 
The limit on the number of enrollees 
is:__________ 
6
 Services 
The State requests that the following State Plan Services be included under this demonstration: 
_____ Personal Care Services  _____ Non-Emergency Transportation 
_____ Durable Medical Equipment
 _____ Other 
_____ Home Health Services 
The State requests that the following Home and Community-Based Services, as set forth in 42 

CFR 440.180, be included under this demonstration: 

_____ Homemaker Services  _____ Transportation

_____ Home Health Aide Services  _____ Supported Employment

_____ Personal Care Services  _____ Other services requested by the State 

_____ Adult Day Health Services  and approved by CMS as budget neutral and 

_____ Respite Care Services  necessary to avoid institutionalization

_____ Enhanced Personal Care

The services available through this demonstration will all be self-directed support services, 
under the direction of the participant, family, or proxy, and will comply with all existing 
regulations unless waived. 
VI. Budget Neutrality 
_____ The attached budget shell relies on the model that the demonstration expenditures will 
not exceed what would have been incurred without the demonstration. 
_____  The State assures that the aggregate cost of services provided herein will be no 
more than 100% of the cost to provide these services without the waiver. The plan of care 
and budget for plan of care will be developed in the demonstration exactly as they would 
have been developed without the waiver.  Procedures for determining the amount, duration, 
and scope of Personal Care services are identical for Personal Care recipients, regardless of 
whether or not they are part of this voluntary demonstration program. 
_____	 The State estimates the cost of this program will be $____________  over its 
_______ year approval period. 
7
 VII.  Additional Requirements 
In addition to the above requirements, the State agrees to the Section 1115 Independence 
Plus: A Demonstration Program for  Family or Individual Directed Community Services 
Special Terms and Conditions (STCs) of Approval, and agrees to prepare the Operational 
Protocol document as described in the Model STCs.  During CMSs review and 
consideration of this demonstration request, using the Model STCs, the state will work 
with CMS to develop STCs that are specific to this request that will become part of the 
approval of demonstration authority. 
__________  ______________________________________________ 
Date  Name of Authorizing Official, Typed 
______________________________________________ 
Name of Authorizing Official, Signed 
8
 Independence Plus 
A Demonstration Program for Family or 
Individual Directed Community Services 
A DEMONSTRATION PROGRAM UNDER SECTION 1115 
Model Special Terms and Conditions of 
Approval 
CENTERS FOR MEDICARE AND MEDICAID SERVICES 
SPECIAL TERMS AND CONDITIONS 
NUMBER:  (11-W-00XXX/XX) 
TITLE:	 Independence Plus: A Demonstration Program for Family or 
Individual Directed Community Services 
AWARDEE:  State & Department Name

The following are Special Terms and Conditions for the award of the Independence Plus: 

A Demonstration Program for Family or Individual Directed Community Services 

Medicaid Section 1115 Demonstration request submitted on _________.  The Special 

Terms and Conditions are arranged in eight subject areas: General Program 

Requirements, General Reporting Requirements, Legislation, Assurances, Operational 

Protocol, General Financial Requirements, Monitoring Budget Neutrality, and a 

Summary Schedule of Reporting Items.

Letters, documents, reports, or other materials that are submitted for review or approval 

must be sent to the Centers for Medicare and Medicaid Services (CMS) Central Office 

Demonstration Project Officer and the State representative in the CMS Regional Office.
 Table of Contents

I.  GENERAL PROGRAM REQUIREMENTS
 3 
II.  GENERAL REPORTING REQUIREMENTS
 4 
III.  LEGISLATION
 4 
III.  ASSURANCES
 5 
V.  OPERATIONAL PROTOCOL
 6 
VI.	 ATTACHMENT A
 10 
GENERAL FINANCIAL REQUIREMENTS 
 10 
VII.  ATTACHMENT B
 13 
MONITORING BUDGET NEUTRALITY 
 13 
FOR THE DEMONSTRATION 
 13 
Projecting Service Expenditures 
 13 
Impermissible DSH, Taxes or Donations 
 14 
Expenditure Review 
 15 
VIII.  ATTACHMENT C
 16 
SUMMARY SCHEDULE OF REPORTING ITEMS 
 16 
Item 
 16 
2
 I.  GENERAL PROGRAM REQUIREMENTS 
1.	 Extension or Phase-out Plan. The State will discuss demonstration extension plans 
with CMS at least 18 months prior to demonstration expiration, and requests for 
extensions are due to CMS no later than 12 months prior to the expiration of the 
demonstration. If the State does not request an extension, it must submit a phase-out 
plan, which includes provisions for cessation of enrollment, to CMS no later than 12 
months prior to the expiration of the demonstration. The phase-out plan will be 
submitted for CMS to review and consider for approval. 
2.	 Cooperation with Federal Evaluators. The State will fully cooperate with Federal 
evaluators and their contractors efforts to conduct an independent Federally funded 
evaluation of the demonstration program. 
3.	 CMS Right to Suspend or Preclude the Demonstration During Implementation. 
The CMS may suspend or preclude State demonstration implementation and/or 
service provision to demonstration enrollees whenever it determines that the State has 
materially failed to comply with the Special Terms and Conditions or other terms of 
the project, and/or if the implementation of the project does not further the goals of 
the Medicaid program. 
4. CMS Right to Terminate or Suspend the Demonstration During Operation. 
During demonstration operation, CMS may suspend or terminate any project in whole 
or in part at any time before the date of expiration, whenever it determines that the 
State has materially failed to comply with any of the terms of the project. The CMS 
will promptly notify the State in writing of the determination and the reasons for the 
suspension or termination, together with the effective date. The State waives none of 
its rights to challenge CMS' finding that the State materially failed to comply.  The 
CMS reserves the right to withhold approval for the demonstration project or 
withdraw such approval at any time, if it determines that granting or continuing the 
demonstration project would no longer be in the public interest. If the demonstration 
project is terminated by action of CMS, CMS will be liable for only normal closeout 
costs.  The State will submit a phase-out plan for CMS to review and consider for 
approval. 
5.	 State Right to Terminate or Suspend Demonstration.  The State may suspend or 
terminate this demonstration in whole or in part at any time before the date of 
expiration. The State will promptly notify CMS in writing of the reasons for 
suspension or termination, together with the effective date. If the demonstration 
project is terminated by the State, CMS will be liable for only normal closeout costs. 
The State will submit a phase-out plan for CMS to review and consider for approval. 
3
 II. 	GENERAL REPORTING REQUIREMENTS 
(Attachment C provides a summary of the frequency of required reporting items.) 
6.	 Monthly Progress Calls. Before and up to three months after implementation, CMS 
and the State will hold monthly calls to discuss demonstration progress and the State 
will respond to questions from CMS regarding any issues. 
7.	 Quarterly & Annual Progress Reports. The State will submit quarterly progress 
reports that are due 60 days after the end of each quarter. The fourth quarterly report 
of every calendar year will include an overview of the past year as well as the last 
quarter, and will serve as the annual progress report. CMS reserves the right to 
request the annual report in draft. The reports must address, at a minimum: 
	 A discussion of events occurring during the quarter (including enrollment 
numbers, lessons learned, and a summary of expenditures); 
	 Notable accomplishments, including findings from Quality Assurance, beneficiary 
survey and evaluation activities; and 
  Problems/issues that were identified and how they were solved. 
8.	 Final Report. At the end of the demonstration, the State will submit a draft final 
report to CMS for review and comments. The final report with CMS comments is 
due no later than 180 days after the termination of the project. 
III. LEGISLATION 
9.	 Changes in the Enforcement of Laws, Regulations, and Policy Statements. All 
requirements of the Medicaid program expressed in laws, regulations, and policy 
statements, not expressly waived or identified as not applicable in the award letter (of 
which these Special Terms and Conditions are part), will apply to the demonstration. 
To the extent that changes in the enforcement of such laws, regulations, and policy 
statements would have affected State spending in the absence of the demonstration in 
ways not explicitly anticipated in this agreement, CMS will incorporate such effects 
into a modified budget limit for the Demonstration. The modified budget limit would 
be effective upon enforcement of the law, regulation, or policy statement. 
If the law, regulation, or policy statement cannot be linked specifically with program 
components that are or are not affected by the demonstration (e.g., all disallowances 
involving provider taxes or donations), the effect of enforcement on the State's budget 
limit will be proportional to the size of the demonstration in comparison to the State's 
entire Medicaid program (as measured in aggregate medical assistance payments). 
4
 10. Changes in Federal Law Affecting Medicaid Expenditures.  The State must, 
within the time frame specified in law, come into compliance with any changes in 
Federal law affecting the Medicaid program that occur after the demonstration award 
date. To the extent that a change in Federal law, which does not exempt State Section 
1115 Demonstrations, would affect State Medicaid spending in the absence of the 
demonstration, CMS will incorporate such changes into a modified budget limit for 
the demonstration. The modified budget limit will be effective upon implementation 
of the change in Federal law, as specified in law. 
If the new law cannot be linked specifically with program components that are or are 
not affected by the demonstration (e.g., laws affecting sources of Medicaid funding), 
the State must submit its methodology to CMS for complying with the change in law. 
If the methodology were consistent with Federal law and in accordance with Federal 
projections of the budgetary effects of the new law in the State, CMS would approve 
the methodology. Should CMS and the State, working in good faith to ensure State 
flexibility, fail to develop within 90 days a methodology to revise the without waiver 
baseline that is consistent with Federal law and in accordance with Federal budgetary 
projections, a reduction in Federal payments will be made according to the method 
applied in non-demonstration states. 
11.	 Amending the Demonstration. The State may submit for CMS consideration a 
request for an amendment to the demonstration to request exemption from changes in 
law occurring after the demonstration award date.  The cost to the Federal 
Government of such an amendment must be offset to ensure that total projected 
expenditures under a modified demonstration do not exceed projected expenditures in 
the absence of the demonstration (assuming full compliance with the change in law). 
IV. ASSURANCES 
Acceptance of the Special Terms and Conditions of Approval constitutes the States 
assurance that the following will be met: 
12. Assurances included in Application.  All assurances checked in the Independence 
Plus: A Demonstration Program for Family or Individual Directed Community 
Services State Proposal Information by this reference become included as items in 
these Special Terms and Conditions of Approval, and will be fulfilled as part of the 
Special Terms and Conditions of Approval. 
13. Preparation and Approval of Operational Protocol. The State will prepare an 
Operational Protocol Document, which represents all policies and operating 
procedures applicable to this demonstration, and will submit the Operational Protocol 
to CMS for approval prior to implementation. The State acknowledges that CMS 
reserves the right not to approve an Operational Protocol in the event that it does not 
comply with the Special Terms and Conditions of Approval.  Requirements and 
required contents of the Operational Protocol are outlined in Section V of these 
Special Terms and Conditions. 
5
 14. Adequacy of Infrastructure. This demonstration will provide adequate resources to 
support participants in directing their own care. The support assures, but is not 
limited to, participants compliance with laws pertaining to employer responsibilities, 
provision for back-up attendants as needs arise, and the performance of background 
checks on employees and guidance to participants on the results of checks.  Adequate 
resources for implementation, monitoring activities, and compliance to the terms and 
conditions of approval of the demonstration will be provided by the State. 
15. Assistance of a Proxy.  This demonstration is designed to assist individuals who are 
capable of directing their own care.  Individuals not capable of directing their own 
care will not be deliberately excluded from participating in the demonstration. 
Specifically, persons who require the assistance of others for care planning, or for 
whom authorization for care must be obtained from a proxy (e.g., a parent or legal 
guardian/representative) will not be excluded from program participation. 
16. Supplant Services.  Cash payments provided under this demonstration program do 
not supplant informal care services that have routinely and previously been available 
to project participants. Such ongoing informal care services will be identified as a 
part of each participants care plan. 
17. Contract Approval.  The Fiscal Intermediary (FI) contract(s) will be reviewed and 
approved by CMS prior to the States requesting Federal financial payments for 
expenditures incurred under the contract(s). 
V.  OPERATIONAL PROTOCOL 
18. Operational Protocol Timelines and Requirements. The Operational Protocol will 
be submitted to CMS no later than 90 days prior to program implementation.  The 
CMS will respond within 60 days of receipt of the protocol regarding any issues or 
areas for which clarification is needed in order to fulfill the terms and conditions of 
approval, those issues being necessary to approve the Operational Protocol. 
The FFP is not available for Medical Assistance Payments prior to CMS approval of 
the Operational Protocol. The FFP is available for post-approval project development 
and implementation, and compliance with Special Terms and Conditions. 
Subsequent changes to the demonstration program and the Operational Protocol that 
are the result of major changes in policy or operating procedures, including changes 
to cost-sharing amounts or subsidy amounts, including adjustments for inflation, must 
be submitted for review by CMS. The State must submit a request to CMS for these 
changes no later than 90 days prior to the date of implementation of the change(s). 
6
 19. Required Contents of Operational Protocol: 
a.	 Organization and Structural Administration. A description of the organizational 
and structural administration that will be in place to implement, monitor, and operate 
the demonstration, and the tasks each organizational component will perform. 
b.	 Reporting Items. A description of the content and frequency of each of the reporting 
items as listed in Section II and Attachments A and C of this document. 
c.  Benefits.  Descriptions or listings of: 
  procedures for determining the plan of care; 
  methodology for establishing the budget for the plan of care; 
  how purchasing plans are developed; 
	 procedures and mechanisms to be used to review and adjust payments for the plan 
of care; 
  services which will be cashed out; and 
	 Alternative Health Related Services which may be approved for participants, as 
well as procedures for amending the list of services. 
d.	 Outreach/Marketing/Education.  A description of the State's outreach, marketing, 
education, and staff training strategy. NOTE: All marketing materials must be 
reviewed and approved by CMS prior to use. Include in the description: 
	 information that will be communicated to enrollees, participating providers, and 
State outreach/education/intake staff (such as social services workers and 
caseworkers); 
  types of media to be used; 
  specific geographical areas to be targeted; 
  locations where such information will be disseminated; 
	 staff training schedules, schedules for State forums or seminars to educate the 
public; and 
	 the availability of bilingual materials/interpretation services and services for 
individuals with special needs. Include a description of how eligibles will be 
informed of cost sharing responsibilities. 
e.	 Eligibility/Enrollment.  A description of the population of individuals eligible for 
the demonstration (and eligibility exclusions) and population phase-in and the 
following: 
  eligibility determination; 
  annual redetermination; 
  intake, enrollment, and disenrollment; 
	 procedures for determining the existence and scope of a demonstration applicants 
existing third party liability; 
7
   the State agency that will be responsible for each of the above processes; and 
	 a comparison of the number of new individuals accessing Medicaid-funded 
community based services to the numbers of individuals accessing Medicaid-
funded community-based services without the demonstration. 
f.	 Enrollment Ceiling. Description of the enrollment ceiling. This description shall 
include the process for amending the enrollment ceiling. 
g.	 Quality. Description of an overall quality assurance monitoring plan that includes, 
but not be limited to the following: 
	 quality indicators to be employed to monitor service delivery under the 
demonstration and the system to be put in place so that feedback from quality 
monitoring will be incorporated into the program; 
	 the mechanisms the State will utilize to assure that the care needs of vulnerable 
populations participating in this demonstration (i.e., the elderly and disabled) are 
satisfied, and that funds provided to these beneficiaries are used appropriately; 
	 the system the State will operate by which it receives, reviews and acts upon 
critical events or incidents, with a description of the critical events or incidents; 
  case management staff for purposes of monitoring participant health and welfare; 
	 quality monitoring surveys to be conducted, and the monitoring and corrective 
action plans to be triggered by the surveys; 
	 plans to report survey results, service utilization, and general quality assurance 
findings to CMS as part of the quarterly and annual reports; 
  procedures for assuring quality of care and participant safeguards; 
	 procedures for insuring against duplication of payment between the 
demonstration, fee for service and Home and Community-Based Services 
programs; and fraud control provisions and monitoring. 
h.	 Education, Counseling, Fiscal/Employer Agent and Support Services. 
Descriptions of the following topics will be included: 
	 the States relationships and arrangements with organizations providing 
enrollment/assessment, counseling, training, and fiscal/employer agent services; 
	 the procurement mechanism, standards, scope of work and payment process for the 
fiscal/employer agent; 
	 procedures for ensuring sufficient availability of fiscal/employer agent services for 
participants who do not pass the mandatory test on employer responsibilities; 
	 procedures for mandatory testing of  participants related to fiscal and legal 
responsibilities and training opportunities and support services available for 
participants of the demonstration who require assistance with their fiscal and legal 
responsibilities; and 
	 the procedures for conducting participants background checks on potential 
providers and informing participants of the results of the criminal background 
checks. 
8
 i.	 Participant Protections: A description of the State procedures and processes to 
assure that protections are in place. The description will include the following: 
	 procedures to assure that families have the requisite information and/or tools to 
direct and manage their care, including but not limited to employer agent services 
such as training in managing the caregivers, assistance in locating caregivers, as 
well as completing and submitting paperwork associated with billing, payment 
and taxation; 
	 a viable system in place for assuring emergency back up and emergency response 
capability in the event those providers of services and supports essential to the 
individuals health and welfare are not available. While emergencies are defined 
and planned for on an individual basis, the State also has system procedures in 
place; 
	 procedures for how the State will work with families who expend their 
individualized budget in advance of the re-determination date to assure that 
services needed to avoid out-of-home placement and the continuation of the 
health and welfare of the individual are available; 
	 procedures for how decisions will be made regarding unexpended resources at the 
time of budget re-determination; and 
	 process by which the State makes available to participants, at no cost, provider 
qualification/background checks. 
j.	 Evaluation Design. A description of the States evaluation design. The description 
will include the following: 
  discussion of the demonstration hypotheses that will be tested; 
	 outcome measures that will be included to evaluate the impact of the 
demonstration; 
  what data will be utilized; 
  methods of data collection; 
	 effects of the demonstration will be isolated from those other initiatives occurring 
in the State; 
	 any other information pertinent to the States evaluative or formative research via 
the demonstration operations; and 
	 plans to include interim evaluation findings in the quarterly and annual progress 
reports (primary emphasis on reports of services being purchased and participant 
satisfaction.) 
9
 ATTACHMENT A 
GENERAL FINANCIAL REQUIREMENTS 
1.	 The State will provide quarterly expenditure reports using the Form CMS-64 to 
report total expenditures for services provided under the Medicaid program, 
including those provided through the demonstration under Section 1115 authority. 
The CMS will provide Federal Financial Participation (FFP) for allowable 
demonstration expenditures only as long as they do not exceed the pre-defined 
limits as specified in Attachment B (Monitoring Budget Neutrality for the 
demonstration). 
2. a. In order to track expenditures under this demonstration, the State will report 
demonstration expenditures through the Medicaid and State Childrens Health 
Insurance Program Budget and Expenditure System (MBES/CBES), 
following routine CMS-64 reporting instructions outlined in Section 2500 of 
the State Medicaid Manual. All expenditures subject to the budget neutrality 
cap will be reported on separate Forms CMS-64.9 WAIVER and/or 64.9P 
WAIVER, identified by the demonstration project number assigned by CMS 
(including the project number extension, which indicates the demonstration 
year in which services were rendered). For monitoring purposes, cost 
settlements must be recorded on Line 10.b, in lieu of Lines 9 or 10c.  For any 
other cost settlements (i.e., those not attributable to this demonstration), the 
adjustments should be reported on lines 9 or 10.c, as instructed in the State 
Medicaid Manual. The term, "expenditures subject to the budget neutrality 
cap," is defined below in item 2.c. 
b. For each demonstration year, a Form CMS-64.9 WAIVER and/or 64.9P 
WAIVER will be submitted reporting expenditures subject to the budget 
neutrality cap.  All expenditures subject to the budget neutrality ceiling for 
demonstration eligibles must be reported. The sum of the expenditures, for all 
demonstration years reported during the quarter, will represent the 
expenditures subject to the budget neutrality cap (as defined in 2.c.). 
c. For the purpose of this section, the term "expenditures subject to the budget 
neutrality cap" will include all Medicaid expenditures on behalf of 
demonstration participants, and those individuals eligible to participate (as 
described in number 3.c. and d. of this section) that are also receiving the 
services subject to the budget neutrality cap.  The services subject to budget 
neutrality include the following categories as they appear on the CMS-64 
WAIVER forms: Home Health Services; Home and Community-Based 
Services, Personal Care Services; Targeted Case Management; Hospice 
Benefits; and Other Care Services (to include the subsets of Non-Emergency 
Transportation, and Durable Medical Equipment). (THE ACTUAL 
SERVICES INCLUDED COULD VARY DEPENDING ON THE 
INFORMATION SUPPLIED BY THE STATE.) 
10
 d.	 Administrative costs will not be included in the budget neutrality limit, but the 
State must separately track and report additional administrative costs that are 
directly attributable to the demonstration. 
e.	 All claims for expenditures subject to the budget neutrality cap (including any 
cost settlements) must be made within 2 years after the calendar quarter in 
which the State made the expenditures.  Furthermore, all claims for services 
during the demonstration period (including any cost settlements) must be 
made within 2 years after the conclusion or termination of the demonstration. 
During the latter 2-year period, the State must continue to identify separately 
net expenditures related to dates of service during the operation of the 1115 
Demonstration on the Form CMS-64 in order to properly account for these 
expenditures in determining budget neutrality. 
f.	 The procedures related to this reporting process, report content, and frequency 
must be discussed by the State in the Operational Protocol (see Section V.) 
3.	  a.  For the purpose of calculating the budget neutrality expenditure cap described 
in Attachment B, the State must provide to CMS on a quarterly basis the 
actual number of eligible member/months for the demonstration eligibles as 
defined below. This information should be provided to CMS in conjunction 
with the quarterly progress report referred to in number 10 of Section III.  If a 
quarter overlaps the end of one demonstration year (DY) and the beginning of 
another, member/months pertaining to the first DY must be distinguished 
from those pertaining to the second.  (Demonstration years are defined as the 
years beginning on the first day of the demonstration, or the anniversary of 
that day.)  Procedures for reporting eligible member/months must be defined 
in the Operational Protocol (see Section V.). 
b. 	 The term, eligible member/months refers to the number of months in which 
persons are eligible to receive services.  For example, a person who is eligible 
for 3 months contributes three eligible member/months to the total. Two 
individuals who are eligible for 2 months each contribute two eligible member 
months to the total, for a total of four eligible member/months. 
c.	 The Independence Plus Initiative Medicaid eligibility group (MEG) consists 
of persons residing in the geographic service areas under the demonstration 
who are using home health agency (HHA) services and for 12 months have 
utilized at least one service per month. (NOTE:  TO BE MODIFIED AS 
NECESSARY TO ADDRESS EACH DEMONSTRATIONS ELIGIBILITY 
CRITERIA) 
d.	  The term demonstration eligibles refers to persons who are eligible in the 
geographic areas of the demonstration and receiving services subject to the 
11
 budget neutrality cap, whether or not they are participants of the cashed out 
feature of the demonstration. 
4. The standard Medicaid funding process will be used during the demonstration. The 
State must estimate matchable Medicaid expenditures on the quarterly Form CMS-37. 
As a supplement to the Form CMS-37, the State will provide updated estimates of 
expenditures subject to the budget neutrality cap as defined in 2c. of this Attachment. 
The CMS will make Federal funds available based upon the State's estimate, as 
approved by CMS. Within 30 days after the end of each quarter, the State must submit 
the Form CMS-64 quarterly Medicaid expenditure report, showing Medicaid 
expenditures made in the quarter just ended.  The CMS will reconcile expenditures 
reported on the Form CMS-64 with Federal funding previously made available to the 
State for the quarter, and include the reconciling adjustment in the finalization of the 
grant award to the State. 
5.	 The CMS will provide Federal Financial Participation (FFP) at the applicable Federal 
matching rate for the following, subject to the limits described in Attachment B: 
a.	 Administrative costs, including those associated with the administration of the 
demonstration. 
b.	  Net expenditures and prior period adjustments of the Medicaid program that are 
paid in accordance with the approved State Plan. 
c.	 Net medical assistance expenditures made under Section 1115 Demonstration 
authority, including those made in conjunction with the demonstration. 
6. The State will certify State/local monies used as matching funds for the Independence 
Plus Initiative and will further certify that such funds will not be used as matching 
funds for any other Federal grant or contract, except as permitted by Federal law. 
12
 ATTACHMENT B 
MONITORING BUDGET NEUTRALITY FOR THE DEMONSTRATION 
The following describes the method by which budget neutrality will be assured under the 

demonstration. The demonstration will be subject to a limit on the amount of Federal 

Title XIX funding that the State may receive on selected Medicaid expenditures during 

the demonstration period. This limit will be determined using a per capita cost method. 

In this way, the State will be at risk for the per capita cost (as determined by the method 

described below) for Medicaid eligibles, but not at risk for the number of eligibles. By 

providing FFP for all eligibles, CMS will not place the State at risk for changing 

economic conditions. However, by placing the State at risk for the per capita costs of 

Medicaid eligibles, CMS assures that the demonstration expenditures do not exceed the 

levels that would have been realized had there been no demonstration.

For the purpose of calculating the overall expenditure limit for the demonstration, 

separate budget estimates will be calculated for each year on a demonstration year (DY) 

basis.  The annual estimates will then be added together to obtain an overall expenditure 

limit for the entire demonstration period.  The Federal share of this estimate will 

represent the maximum amount of FFP that the State may receive during the 5-year 

period for the types of Medicaid expenditures described below. For each DY, the Federal 

share will be calculated using the FMAP rate(s) applicable to that year. 

Projecting Service Expenditures 
Each demonstration year budget estimate of Medicaid service expenditures will be 
calculated as the product of the trended monthly per person cost times the actual number 
of eligible/member months as reported to CMS by the State under the guidelines set forth 
in Attachment A number 3.a. The State Fiscal Year (SFY) 2000 base year cost is 
$31,966.46 (or $ 2,663.87 monthly per person cost) and the trended amounts by SFY are 
the following (THE NUMBERS PROVIDED ARE SAMPLES FOR PURPOSE OF 
ILLUSTRATION  THE ACTUAL AGREEMENT WOULD BE BASED ON 
INFORMATION PROVIDED BY THE STATE ON THE INCLUDED WORKSHEET): 
State Fiscal Year  Trended Monthly Per Person 
Cost 
SFY 2002  $  2948.11 
SFY 2003  $  3101.41 
SFY 2004  $  3262.37 
SFY 2005  $  3432.01 
SFY 2006  $  3610.48 
SFY 2007  $  3798.23 
Demonstration Years which do not align with State Fiscal Years or which fall beyond the 
range of years shown will be calculated using an annual trend rate of 5.2% or a monthly 
trend rate of .423336% (THE TREND RATE USED IS FOR THE PURPOSE OF 
13
 ILLUSTRATION  THE ACTUAL AGREEMENT WOULD BE BASED ON 
INFORMATION FROM THE STATE.  THE TREND RATE WOULD BE THE 
LOWER OF THE STATES TREND OR THE TREND FROM THE PRESIDENTS 
BUDGET.) 
Using the trend rates to produce non-Federal fiscal year PMPM cost estimates 
Because the beginning and the end of the demonstration are unlikely to coincide with 
either the Federal or State fiscal year, the following methodology will be used to produce 
DY estimates of PMPM cost. Using the monthly equivalent growth rate of .423336%, 
the appropriate number of monthly trend factors will be used to convert SFY 2000 base 
year PMPM costs to PMPM costs for the first DY. After the first DY, the annual trend 
factor of 5.2% will be used to trend forward from one year to the next. (This procedure is 
described more fully in the sample calculations presented below.) 
Sample Calculations 
First Demonstration Year:

As an example, assume that the base year (SFY ended 6/30/2000) per capita cost for the 

enrolled population is $1,000, and the first year of a demonstration (DY 2001) beginning 

January 1, 2001, and ends December 31, 2001. DY 2001 is 18 months in time beyond 

SFY 2000; therefore, the monthly trend factor must be applied to trend SFY 2000 cost 

forward to DY 2001. Applying the monthly trend factor to bring the base year estimate 

forward to DY 2001 results in PMPM cost of $1079. ($1079 = $1000 x 1.0042333618)

Second and Subsequent Demonstration Years: 
Since DY 2002 is 12 months beyond DY 2001, 12 months of growth factor are needed. 
Applying the 5.2 percent growth factor to the estimated DY 2001 PMPM cost of $1079 
gives a DY 2002 PMPM cost of $1135. 
Impermissible DSH, Taxes or Donations 
The CMS reserves the right to adjust the budget neutrality ceiling to be consistent 
with enforcement of impermissible provider payments, health care related taxes, new 
Federal statutes, or policy interpretations implemented through letters, memoranda or 
regulations. The CMS reserves the right to make adjustments to the budget neutrality 
cap if any health care related tax that was in effect during the base year, or provider 
related donation that occurred during the base year, is determined by CMS to be in 
violation of the provider donation and health care related tax provisions of 1903(w) of 
the Social Security Act. Adjustments to annual budget targets will reflect the phase 
out of impermissible provider payments by law or regulation, where applicable. 
How the Limit will be Applied 
The limit calculated above will apply to actual expenditures for long-term care services, 
as reported by the State under Attachment A. If at the end of the demonstration period 
the budget neutrality provision has been exceeded, the excess Federal funds will be 
returned to CMS. There will be no new limit placed on the FFP that the State can claim 
for expenditures for recipients and program categories not listed. If the demonstration is 
14
 terminated prior to the 5-year period, the budget neutrality test will be based on the time 
period through the termination date. 
Expenditure Review 
The CMS shall enforce budget neutrality over the life of the demonstration, rather than 
on an annual basis. However, no later than 6 months after the end of each demonstration 
year, CMS will calculate an annual expenditure target for the completed year. This 
amount will be compared with the actual FFP claimed by the State under budget 
neutrality.  Using the schedule below as a guide, if the State exceeds the cumulative 
target, they must submit a corrective action plan to CMS for approval. The State will 
subsequently implement the approved program. 
Year  Cumulative target definition  Percentage 
Year 1  Year 1 budget estimate plus  8 percent 
Year 2  Years 1 and 2 combined budget estimate plus  3 percent 
Year 3  Years 1 through 3 combined budget estimate plus  1 percent 
Year 4  Years 1 through 4 combined budget estimate plus  0.5 percent 
Year 5  Years 1 through 5 combined budget estimate plus  0 percent 
15
 ATTACHMENT C 
SUMMARY SCHEDULE OF REPORTING ITEMS 
Item  Timeframe for Item  Frequency of Item 
Monthly Conference  Prior to demonstration  Monthly progress calls with 
Calls  implementation and Post- CMS and the State. 
implementation. 
Operational Protocol  Due to CMS 90 days prior to  One Operational Protocol. 
implementation, CMS comments  Changes to the Operational 
30 days prior to implementation,  Protocol must be submitted and 
and State completion/CMS  approved by CMS. 
approval prior to implementation. 
Quarterly/Annual  Due to CMS 60 days after the end  One quarterly report per Federal 
Progress Reports  of a quarter.  Fiscal Year quarter during 
operation of the demonstration; 
the report for the fourth quarter 
of each year will serve as the 
annual progress report. 
Final Report  Due to CMS 180 days after the  One final report. 
end of the demonstration. 
16
 Independence Plus 
A Demonstration Program for Family or Individual 
Directed Community Services Waiver 
1915 (c) of the Social Security Act 
 
Created by: 
Center for Medicaid and State Operations 
NOTE:  This document has not yet received OMB approval of the information 
collection pursuant to the Paperwork Reduction Act.   Table of Contents 
TEMPLATE FOR INDEPENDENCE PLUS: A DEMONSTRATION PROGRAM FOR 
FAMILY OR INDIVIDUAL DIRECTED COMMUNITY SERVICES WAIVER 1915(c) 
VERSION 
I. STATE PROPOSAL INFORMATION
 3 
II. GENERAL DESCRIPTION OF PROGRAM
 3 
III.  ASSURANCES
 4 
IV. WAIVERS REQUESTED
 5 
V. 	STATE SPECIFIC ELEMENTS
 6 
Levels Of Care 
 6 
Target Population 
 6 
Medicaid Eligibility
 8 
Services 
 9 
VI. COST NEUTRALITY
 10 
VII. 	ADDITIONAL REQUIREMENTS 
 10 
Plan Of Care 
 10 
Individual Budgets 
 11 
Provider Selection 
 11 
Plan Of Care Management 
 11 
Participant Protections 
 12 
Quality Assurance & Improvement 
 12 
Contact Person 
 13 
Authorizing Signature 
 13 
2
 Template for Independence Plus: A Demonstration Program for 
Family or Individual Directed Community Services  1915(c) Waiver 
Application 
I. State Proposal Information 
The State of ________________ requests approval of a Medicaid Home and Community-Based 
Services (HCBS) Waiver under the authority of Section 1915(c) of the Social Security Act. The 
program, to be entitled: __________________________ will allow Medicaid beneficiaries to 
arrange and purchase family and individual supports and related services as described below. 
The proposed effective date of this waiver program is _________________________.  Initial 
waivers are approved for three years.  Renewal waivers are extended for five years. 
Line of Authority for Waiver Operation:  (Note: The State Medicaid Agency is ultimately 
accountable for the operation of the program, but may allow daily operations to be 
managed by another entity of State government.) Check one: 
_____	 The waiver will be operated directly by the ____________________________ 
Unit of the State Medicaid Agency/Single State Agency. 
_____ Operational management and responsibilities of the waiver will be carried out by 
______ (another State Agency) and will be subject to an explicit interagency agreement 
that ensures for accountability and effective management for all requirements and 
assurances under this waiver.  The single State Agency will retain the responsibilities of 
issuing policies, rules and regulations concerning this waiver. A copy of the interagency 
agreement setting forth the specific agency responsibilities and authorities is attached and 
is made pursuant to Section 1902(a) of the Act and 42 regulations at 42 CFR 431.10 
which stipulates the roles and responsibilities of the single State Agency. 
II.  General Description of Program 
The purpose of the program is to provide assistance for families with a member who requires 
long-term supports and services, or to individuals who require long-term supports and services, 
so that the individual may remain in the family residence or in their own home.  Eligibility will 
be limited to those individuals who require long-term supports at a level typically provided in an 
institution, as specified in this application. 
The State has the flexibility to define a range of community-based services that will support 
families and individuals. Families and individuals will work with the State to identify, through a 
family or person-centered planning process, those services and supports needed to avoid 
placement in an institutional setting or placement in group living arrangements of greater than 
four persons. The State will maintain the ability to control costs and, in conjunction with 
individuals or families, establish mutual expectations regarding available resources. These 
resources will be identified through an established methodology, open for public inspection, for 
determining an individual budget that would be based upon actual service utilization data. 
3
 Through the provision of services and supports identified through the plan of care and the 
operation of a quality assurance and improvement program, the State will ensure the health and 
welfare of the individuals in the program. In addition, the program will provide assurances of 
fiscal integrity and include participant protections that will be effective and family-friendly. 
(Additional information, specific to the State administration is included in Appendix A.) 
III. Assurances 
The State provides the following assurances to CMS: 
Health & Welfare - Necessary safeguards have been taken to protect the health and welfare of 
persons receiving services under this waiver.  Those safeguards are described in Appendix B 
and include: 
A.  Adequate standards for all types of providers that furnish services under the waiver; 
B.	 Assurance that the standards of any State licensure or certification requirements are 
met for services or for individuals furnishing services that are provided under the 
waiver. The State assures that these requirements will be met on the date that the 
services are furnished; and 
C.	 Assurance that all facilities covered by Section 1616(e) of the Social Security Act, in 
which Home and Community-Based Services will be provided, are in compliance 
with applicable State standards for board and care facilities. 
Check one: 
_____	 Home and Community-Based Services will not be provided in facilities 
covered by Section 1616(e) of the Social Security Act. 
_____	 A list of facilities covered by 1616(e) of the Social Security Act, in which 
HCBS are furnished, and a copy of the standards applicable to each type 
of facility identified above are also maintained by the Medicaid Agency. 
These facilities will be used for the limited purpose 
of:___________________________________ 
(Note: For example, respite care only when other services are 
unavailable.) 
Financial Accountability -The State will maintain the financial integrity of the HCBS Waiver 
program. The State will assure financial accountability for funds expended for Home and 
Community-Based Services, provide for an independent audit of its waiver program, and will 
maintain and make available to HHS, the Comptroller General, or other designees, appropriate 
financial records documenting the cost of services provided under the waiver, including reports 
of any independent audits conducted. See Appendix G-3. 
Evaluation of Need - The State will provide for an evaluation (and periodic reevaluations, at 
least annually) of the individuals need for an institutional level of care, when there is a 
reasonable indication that individuals might need such services in the near future (one month or 
4
 less) but for the availability of Home and Community-Based Services.  The requirements for 
such evaluations and reevaluations are detailed in  Appendix D. 
Choice of Alternatives - When an individual is determined to require a level of care provided in 
a NF, hospital, or ICF/MR, the individual or his or her legal representative will be: 
A.  Informed of any feasible alternatives under the waiver; and 
B.  Given the choice of either institutional or Home and Community-Based Services. 
The State will provide an opportunity for a fair hearing under 42 CFR Part 431, subpart E, to 
persons who are not given the choice of home or community-based services as an alternative to 
institutional care, or whose services are denied, suspended, reduced or terminated. 
Average per capita expenditures - The average per capita expenditures under the waiver will 
not exceed 100 percent of the average per capita expenditures for the level(s) of care, for which 
this waiver is an alternative, under the State plan that would have been made in that fiscal year 
had the waiver not been granted. Cost neutrality is demonstrated in Appendix G. 
Actual total expenditures - The State's actual total expenditures for Home and 
Community-Based Services and other Medicaid services under the waiver and its claim for FFP 
in expenditures for the services provided to individuals under the waiver will not, in any year of 
the waiver period, exceed 100 percent of the amount that would be incurred by the State's 
Medicaid program for these individuals in the institutional setting(s) for which this waiver is an 
alternative in the absence of the waiver. Cost neutrality is demonstrated in Appendix G. 
Services absent the waiver - Absent the waiver, participants would receive the services 
appropriate to the level of care typically provided in institutional settings available through the 
State plan. 
Reporting - The agency will provide CMS annually with information on the impact of the 
waiver on the type, amount and cost of services provided under the waiver and on the health and 
welfare of the persons served through the waiver. The information will be consistent with a data 
collection plan designed by CMS. Reporting is described in Appendix F-2 
IV.  Waivers Requested 
Statewideness: The State requests a waiver of the "Statewideness" requirements set forth in 
Section 1902(a)(1) of the Act. 
_____ No.  Services will be available Statewide. 
_____  Yes.  Waiver services will be furnished only to individuals in the following 
geographic areas or political subdivisions of the State (Specify): 
________________________________________________________________________

________________________________________________________________________

5
 Comparability: The State requests a waiver of the requirements contained in Section 
1902(a)(10)(B) of the Act, to provide services to individuals served on the waiver that are not 
otherwise available to other individuals under the approved Medicaid State plan. 
Income and Resources: The State requests a waiver of 1902(a)(10)(C)(i)(III) of the Social 
Security Act in order to use institutional income and resource rules for the medically needy. 
__________  Yes  __________  No  __________ N/A 
V. State Specific Elements 
A.	 Levels Of Care: This waiver is requested to provide Home and Community-Based 
Services (HCBS) to individuals who, but for the provision of such services, would 
require the following levels (s) of care, the cost of which could be reimbursed under the 
approved Medicaid State plan: (check all that apply) 
_____ Hospital 
_____ Nursing Facility 
_____ ICF/MR 
B.	 Target Population: A waiver of Section 1902(a)(10)(B) of the Act is requested to limit 
Home and Community-Based Services waiver services to select groups of individuals 
who would be otherwise eligible for waiver services. The target groups are indicated 
below: 
1.	 Target group per 42 CFR 441.301(b)(6)  Check all disability and age categories 
that apply. (Note: Current regulations governing 1915(c) waivers do not allow 
persons under age 65 with mental retardation or developmental disability  and no 
concurrent physical disability  to be served in a waiver that serves persons with 
physical disabilities only. Combining populations under the 1115 Demonstration 
authority is allowable.) 
Category  CHILDREN  ADULTS  AGED 
AGE RANGE  AGE RANGE  AGE RANGE 
From  To  From  To  From 
Aged only 
Disabled (Physical) 
Disabled (Other) 
Brain Injury 
(Acquired) 
Brain Injury 
(Trauma) 
HIV/AIDS 
6
 Medically Fragile 
Technology 
Dependent 
Autism 
Developmental 
Disability 
Mental Retardation 
Mental Illness 
2.	 States have the discretion to further define these target groups. If the State wishes 
to further define, please describe below: 
__________________________________________________________________ 
__________________________________________________________________ 
__________________________________________________________________ 
__________________________________________________________________ 
3.  The State selects the following option regarding individual cost limits: 
______ A. 	 No otherwise eligible individual will be denied services or 
enrollment in the waiver solely because the cost of the 
individuals Home and Community-Based Services exceeds the 
average institutional Medicaid payment for the applicable level of 
care. 
_______ B. 	Otherwise eligible individuals may be denied home or 
community-based services if the agency reasonably expects that 
the cost of the Home and Community-Based Services would 
exceed the cost of an equivalent and applicable level of 
institutional care, pursuant to 42 CFR 441.301(a)(3). The State 
selects the following method to calculate these costs: 
______ Individualized Computation.  The Medicaid cost 
of the individual's service plan is compared to the cost of 
serving this particular individual in the institutional 
setting. 
______ Mathematical  Average.  The Medicaid cost of 
the individual's service plan will be compared to the state's 
average per capita cost of applicable institutional care at 
________ 100% of the institutional average or a level 
higher than 100% ( ________%).  Further, the limit will 
be calculated on the basis of: 
_________ 1) Level of care 
7
 _________  2)  Diagnosis or condition 
C.	 Medicaid Eligibility: All eligibility groups included under this waiver are covered in the 
State plan. The State will apply all applicable FFP limits under the plan. 
1.	 Eligibility Criteria: Specify whether your State uses the eligibility criteria used by 
the Supplemental Security Income (SSI) program or whether it uses more restrictive 
eligibility criteria than those of the SSI program for aged, blind, and disabled 
individuals: (check one): 
____  SSI Criteria or 1634 State.  The State uses SSI criteria. 
____ 209(b) State.  The State uses more restrictive eligibility criteria for aged 
blind, and disabled individuals than the criteria used under the SSI program. 
2.	 Eligibility Groups Served:  Individuals receiving services under this waiver are 
eligible for Medicaid under the following eligibility groups: (check one): 
a.  All eligibility groups covered in the State plan are included under this 
waiver. 
b.  Only the following groups covered under the State plan are included 
under this waiver. (Check all that apply) 
1.	 _____ Low-income families with children as described in Section 
1931 of the Social Security Act 
2.  _____ SSI Recipients 
3.  _____Aged, blind or disabled who are eligible under 42 CFR 435.121 
4.	 _____ Medically needy (A waiver of Section 1902(a)(10)(C)(i)(III) of 
the Social Security Act is requested to use institutional income and 
resource rules for the medically needy.) 
5.	 _____ All other optional and mandatory groups under the plan except 
for those individuals who would be eligible for Medicaid only if 
they were in an institution). 
6.	 _____ Individuals who would be eligible for Medicaid only if they 
were in an institution 
7.	 _____ Individuals who would only be eligible for Medicaid, without 
spend down income, if they were living in a hospital, NF or 
ICF/MR.  (Check one) 
_____ All Individuals 
_____ Limited to: 
A special income level equal to:

_____300% of the SSI Federal Benefit Rate (FBR), OR

_____ %, a percentage lower than 300% of FBR, OR

$____, a specific amount that is lower than 300% of FBR

_____ Aged blind and disabled who meet requirements that are 
more restrictive than those in the SSI program 
8
 (Please explain:________________________________________

_____________________________________________________ 

_____ Medically needy without spend down

_____ Other: _________________________________________

3.	 Spousal Impoverishment Protection: Spousal impoverishment rules may be used 
for determining eligibility for the special Home and Community-Based Waiver 
eligibility group at 42 CFR 435.217 for individuals who have a spouse residing in 
the community. Further, these rules may apply to the post-eligibility treatment of 
income. 
The State will use spousal impoverishment rules for determining income: 
Yes  No 
The State will use spousal impoverishment rules for the post-eligibility treatment 
of income: 
_____ Yes  _____ No 
D.	 Services: The State requests that the following Home and Community-Based Services, 
as set forth in 42 CFR 440.180, be included under this waiver (Check all that apply here 
and define in Appendix B): (NOTE:  All services must meet applicable regulatory 
standards and CMS policy guidance.  Refer to Appendix B for new self-directed service 
descriptions.) 
Check all that apply: 
Family or Individual  Provider or 
Service  Directed Method  Other Service Delivery Method 
Case Management 
Homemaker Services 
Home Health Aide 
Services 
Personal Care Services 
(may include Attendant 
Care) 
Adult Day Health 
Services 
Habilitation Services 
Respite Services 
Supports Brokerage 
Services/Functions 
(Required) 
Fiscal/Employer Agent 
Services/Functions 
(Required) 
Other (Describe in 
Appendix B) 
9
 VI. Cost neutrality 
The State has provided the supporting information/data to demonstrate cost neutrality in 
Appendix G. 
VII.  Additional Requirements 
A.	 Plan Of Care: A written plan of care will be developed for each individual under this 
waiver utilizing a family or person-centered planning process that reflects the needs and 
preferences of the individual and their family. The States procedures governing the plan 
of care and the utilization of family or person-centered planning are included in 
Appendix E. 
(Note: Family or person-centered planning is a process, directed by the family or the 
individual with long-term care needs, intended to identify the strengths, capacities, 
preferences, needs and desired outcomes of the individual. The family or individual 
directs the family or person-centered planning process. The process includes participants 
freely chosen by the family or individual who are able to serve as important contributors. 
The family or person-centered planning process enables and assists the individual to 
identify and access a personalized mix of paid and non-paid services and supports that 
will assist him/her to achieve personally-defined outcomes in the most inclusive 
community setting.  The individual identifies planning goals to achieve these personal 
outcomes in collaboration with those that the individual has identified, including medical 
and professional staff. The identified personally-defined outcomes and the training, 
supports, therapies, treatments and/or other services the individual is to receive to achieve 
those outcomes become a part of the plan of care.) 
All services will be furnished pursuant to a written plan of care. 
This plan of care will describe the services and supports (regardless of funding source) to 
be furnished, their projected frequency, and the type of provider who will furnish each. 
The plan of care will address how potential emergency needs of the individual will be 
met. 
The plan of care will be subject to the approval of the Medicaid Agency. 
FFP will not be claimed for waiver services furnished prior to the development of the 
plan of care or services that are not included in the individual written plan of care. 
10
 B.  Individual Budgets: 
(NOTE:  Individual budgets include the value of the waiver services available to the 
family or individual to support the individuals plan of care. Only waiver services as 
defined by the State are included in the individual budget. This amount of money 
designated in the budget is established by a methodology determined by the State and the 
amount is agreed upon with the family or individual.) 
Check one: 
_____ The State has established a uniform methodology by which all individual 
budgets in the State will be calculated. The methodology is described in 
Appendix H.  (Note: Minimum requirements of the methodology are that the 
budget is built upon actual service utilization and cost data, the methodology is 
described to the individual and their family, the methodology is open for 
inspection by authorized public entities including, but not limited to CMS, and 
there is a process for re-determination.) 
_____ The State has established a minimum set of criteria and an approval 
process for methodologies developed by subcontractors, counties or other entities 
with which the State has contracted for the day-to-day operation of the waiver. 
The criteria by which individual budget methodologies will be reviewed and the 
approval process is described in Appendix H.  (Note: Minimum requirements of 
the methodology are that the budget is built upon actual service utilization and 
cost data, the methodology is described to the individual and their family, the 
methodology is open for inspection by authorized public entities including, but 
not limited to, CMS, and there is a process for re-determination. Although the 
Medicaid Agency may contract with another agency or organization for the daily 
operation of the waiver program, it must retain the authority to issue policies, 
rules and regulations related to the waiver.) 
C.	 Provider Selection: Families and individuals will have flexibility to select qualified 
providers of their choosing within the criteria established by the State. The criteria are 
described in Appendix B. 
D.	 Plan Of Care Management: Families and individuals will have the ability to direct the 
services and supports identified in the plan of care within the resources available in the 
established individual budget.  Families will have maximum possible flexibility in the 
utilization of resources delineated in the plan of care and individual budget. The States 
description of how families may flexibly use resources while the State continues to assure 
health and welfare is described in Appendix E. 
(Note: As determined by the state, families and individuals may have the ability to move 
resources among and between all or some of the services contained in the plan of care 
without a formal plan of care revision. Families or individuals might have full discretion 
11
 to manage all of the plan or only parts of it. For example, the family or individual might 
manage the homemaker services, but not the habilitation services.) 
E.	 Participant Protections: The State assures that each of the protections below is in place 
and described in Appendix I. 
The State has procedures to assure that families have the requisite information and/or 
tools to participant in a family or person-centered planning approach and to direct and 
manage their care as outlined in the individual plan of care.  The State will make 
available and provide services such as assistance in locating and selecting qualified 
workers, training in managing workers, completing and submitting paperwork associated 
with billing, payment and taxation. Supports Brokerage and Fiscal/Employer Agent 
Services/Functions are required and should be provided by one or more entities. The 
services and the provider qualifications are described in Appendix B. 
Upon family or individual request, the State makes available, at no cost, provider 
qualification checks, including criminal background checks. (Note: Provider 
qualifications for each service are described in Appendix B.) 
The State has procedures to promote family and individual preferences and selections and 

these are appropriately balanced with accepted standards of practice. This balance 

requires deference to the individual whenever possible. Procedures will include 

individual risk management planning (e.g., risk agreements or informed consent 

contracts) to ensure that family or individual decisions are honored. 

The State has a viable system in place for assuring emergency back-up and/or emergency 

response capability in the event those providers of services and supports essential to the 

individuals health and welfare are not available. While emergencies are defined and 

planned for on an individual basis, the State also has system procedures in place.

The State has procedures for how it will work with families or individuals and their 
fiscal/employer agents (if applicable) to monitor the ongoing expenditure of the 
individual budget. 
The State has procedures for how it will handle those instances where this ongoing 
monitoring has failed to prevent the expenditure of the individual budget in advance of 
the re-determination date to assure that services needed to avoid out-of-home placement 
and the health and welfare of the individual are available. 
The State has procedures for how decisions will be made regarding unexpended resources 
at the time of budget re-determination. 
F.  Quality Assurance & Improvement: 
The State, through an organized quality assurance program, will provide appropriate 
oversight and monitoring of its HCBS Waiver program to ensure that each of the 
12
 assurances contained in this application is met and to continually improve the operation 
of the program. The program will involve families or individuals in the process of 
assessing and improving quality. Details of this process are found in Appendix F of this 
request. The State further assures that all problems identified by this monitoring will be 
addressed in an appropriate and timely manner, consistent with their severity and nature 
and will contain an incident management system to address critical events. 
G.	 Contact Person: The State Medicaid Agency Representative that CMS may contact with 
questions regarding the waiver request is: 
Name: 
Title: 
Agency: 
Address: 
Telephone: 
E-mail: 
H.	 Authorizing Signature: This document, together with Appendices A through I, and all 
attachments, constitutes the State's request for a Independence Plus: A Demonstration 
Program for Family or Individual Directed Community Services Home and 
Community-Based Services Waiver under Section 1915(c) of the Social Security Act. 
The State affirms that it will abide by all conditions set forth in the waiver (including 
Appendices and Attachments), and certifies that any modifications to the waiver request 
will be submitted in writing by the State Medicaid Agency. Upon approval by CMS, this 
waiver request will serve as the State's authority to provide Home and Community-Based 
Services to the target group under its Medicaid plan.  Any proposed changes to the 
approved waiver will be formally requested by the State in the form of waiver 
amendments. 
The State assures that all material referenced in this waiver application (including 

standards, licensure and certification requirements) will be kept on file at the Medicaid 

Agency.

(Note: The request must be signed by the Governor, Single State Agency or Medicaid 

Director, or a person within the State Medicaid Agency with the authority to sign on 

behalf of the State.)

Signature: 

Print Name: 

Title:

Date:

13
 APPENDIX A  DESCRIPTION OF THE WAIVER PROGRAM 
(Note: The state must provide a narrative description of the waiver program beyond the general 
description above. This includes the intended purposes of the waiver.) 
14
 APPENDIX B - SERVICE DEFINITIONS, STANDARDS AND 
PROVIDER QUALIFICATIONS 
A. SERVICE DEFINITIONS, STANDARDS & PROVIDER QUALIFICATIONS CHARTS 
For each service that was checked under State Specific Elements/Services of the template, the 
following chart must be completed. Each chart provides the States service definition, outlines 
the provider qualifications and standards, and the service delivery method that govern the 
provision of each service under the waiver. 
Provider qualifications would be expected to vary by the type of service being provided or 
managed. For those services for which there is a uniform State license or certification 
requirement, the legal citation is provided. For State defined standards other than those governed 
by State law, the standards are attached. Either the family or individual and the State Agency 
may manage some services. For example, the family or individual might have self-directed 
support services which include personal care type arrangements. The State may also have 
personal care services provided by an agency. The provider requirements might be different 
under these two arrangements.  However, the differences must be explained. 
For those services that are available in the State plan, the description must include those aspects 
of the service that go beyond the State plan coverage.  (Note: For example, if personal care 
services are included in the State plan, personal care services provided under the scope of the 
waiver must differ in amount, scope, supervision arrangements or provider type or be utilized 
only when the state plan coverage is exhausted.) 
The State has the authority to request that the Secretary approve other services identified by 
the State as cost neutral and appropriate to avoid institutionalization. Each other service 
defined by the State must be separately identified and defined and include the provider 
qualifications. 
Service/Function Definitions Not Described Elsewhere: 
Supports Brokerage: Service/function that assists participating families and 
individuals to make informed decisions about what will work best for them, are 
consistent with their needs and reflect their individual circumstances. Serving as 
the agent of the family or participant, the service is available to assist in 
identifying immediate and long-term needs, developing options to meet those 
needs and accessing identified supports and services.  A family or person-
centered planning approach is used. Supports Brokerage offers practical skills 
training to enable families and individuals to remain independent. Examples of 
skills training include providing information on recruiting and hiring personal 
care workers, managing personal care workers and providing information on 
effective communication and problem-solving. The service/function provides 
sufficient information to assure that participants and their families understand the 
responsibilities involved with self direction and assist in the development of an 
effective back-up and emergency plan. States may elect to fulfill the requirement 
15
 of this service/function using a self-directed case manager or creating a distinct 
service.  States may elect to fulfill this required service/function either as a 
service cost or an administration cost, but must clearly identify which method 
will be used. The services/functions included in Supports Brokerage are 
mandatory requirements of the template. 
Fiscal/Employer Agent: Service/function that assists the family or individual to 
manage and distribute funds contained in the individual budget including, but not 
limited to, the facilitation of the employment of service workers by the family or 
individual, including Federal, state, and local tax withholding/payments, 
unemployment compensation fees, wage settlements, fiscal accounting and 
expenditure reports, etc. States may elect to fulfill this required service/function 
either as a service cost or an administration cost, but must clearly identify which 
method will be used. This service/function, regardless of provider or method, 
must be delivered under a family or person-centered planning process and is a 
requirement of the template. 
Other Services: Services appropriate to ensure the health and welfare of 
individual participants and, in conjunction with other services, serve as an 
alternative to institutionalization. 
Service Title 
Service 
Definition 
Provider 
Requirements 
State License 
Certification 
Other 
Requirements or 
Standards 
Describe Service 
Delivery Method 
(Agency or Self-
directed) 
B.  ASSURANCES THAT REQUIREMENTS ARE MET 
1.	 The State assures that the standards of any State licensure or certification 
requirements are met for services or for individuals furnishing services provided 
under the waiver. 
16
 2.	 The State assures that each service furnished under the waiver is cost-effective 
(compared to the cost of institutional care) and necessary to prevent 
institutionalization.  Cost effectiveness is demonstrated in Appendix G. 
C.  FREEDOM OF CHOICE 
The State assures that each individual found eligible for the waiver will be given free 
choice of all qualified providers of each service included in his or her written plan of 
care. 
17
 APPENDIX C  INTENTIONALLY LEFT BLANK

18
 APPENDIX D - ENTRANCE PROCEDURES AND REQUIREMENTS 
APPENDIX D-1 
a.  QUALIFICATIONS OF INDIVIDUALS PERFORMING INITIAL EVALUATION 
Persons performing initial evaluations of level of care for waiver applicants will have the 
following educational/professional qualifications: 
b.  PROCESS FOR LEVEL OF CARE DETERMINATION 
The following describes the process for evaluating and screening waiver applicants to 
determine level of care: 
c.	 CONSISTENCY WITH INSTITUTIONAL LEVEL OF CARE 
The State will use the following methods to ensure that level of care determinations used for 
the waiver program are consistent with those made for institutional care under the State plan: 
APPENDIX D-2 
a.  REEVALUATIONS OF LEVEL OF CARE 
Reevaluations of the level of care required by the individual will take place (at least 
annually) according to the following schedule: 
b.	 QUALIFICATIONS OF PERSONS PERFORMING REEVALUATIONS 
Persons performing reevaluations of level of care will have the following qualifications: 
c.  PROCEDURES TO ENSURE TIMELY REEVALUATIONS 
The State will employ the following procedures to ensure timely reevaluations of level of 
care: 
APPENDIX D-3 
a.  MAINTENANCE OF RECORDS 
1.	 Records of evaluations and reevaluations of level of care will be maintained in the 
following location(s): 
2.	 Written documentation of all evaluations and reevaluations will be maintained as 
described in this Appendix for a minimum period of 3 years. 
19
 b.  COPIES OF FORMS AND CRITERIA FOR EVALUATION / ASSESSMENT 
A copy of the written assessment instrument(s) to be used in the evaluation and reevaluation 
of an individual's need for a level of care indicated in item 2 of this request is attached to this 
Appendix.  If this instrument differs from the form used to evaluate or assess institutional 
level of care, a description of how and why it differs and an assurance that the outcome of the 
determination is reliable, valid, and fully comparable is attached. 
APPENDIX D-4 
a.  FREEDOM OF CHOICE AND FAIR HEARING 
1.	 When an individual is determined to be likely to require a level of care provided in an 
institutional setting, the individual or his or her legal representative will be: 
a.  informed of any feasible alternatives under the waiver; and 
b.  given the choice of either institutional or Home and Community-Based services. 
PROCESS:  The following describes the agencys procedure(s) for informing eligible 
individuals of the feasible alternatives available under the waiver and allowing these 
individuals to choose either institutional or waiver services: 
2.	 The agency will provide an opportunity for a fair hearing under 42 CFR Part 431, subpart 
E, to individuals who are not given the choice of home or community-based services as 
an alternative to the institutional care or who are denied the service(s) of their choice, or 
the provider(s) of their choice. 
PROCESS: The following describes the process for informing eligible individuals of their 
right to request a fair hearing under 42 CFR Part 431, Subpart E: 
b.  FREEDOM OF CHOICE DOCUMENTATION 
1. A copy of the form(s) used to document freedom of choice and to offer a fair hearing 
is attached to this Appendix. 
2. Copies of free choice documentation are maintained in the following location(s): 
_______________________________. 
20
 APPENDIX E - PLAN OF CARE 
APPENDIX E-1 - PLAN OF CARE DEVELOPMENT/MAINTENANCE 
1.	 The attached policy and procedures define and guide the family or person-centered 
planning process and assure that families are integrally involved in the plan development 
and that the plan of care reflects their preferences, choices, and desired outcomes. 
2.	 The following individuals are responsible for the preparation of the plans of care: 
. 
3.	 Copies of written plans of care will be maintained for a minimum period of 3 years in the 
following location(s): 
4.	 The plan of care is the fundamental tool by which the State will ensure the health and 
welfare of the individuals served under this waiver. As such, it will be subject to periodic 
review and update. These reviews will take place to determine the appropriateness and 
adequacy of the services, and to ensure that the services furnished are consistent with the 
nature and severity of the individual's disability, and responsive to the individuals needs 
and preferences. The minimum schedule under which these reviews will occur is: 
5. 	If the State uses a standardized plan of care document, a copy of this form should be 
submitted. 
APPENDIX E-2  MEDICAID AGENCY APPROVAL 
The following is a description of the process by which the plan of care is made subject to the 
approval of the Medicaid Agency. 
APPENDIX E-3  PLAN OF CARE MANAGEMENT 
The following is a description of process and parameters within which families or individuals 
have flexibility to utilize resources identified within the plan of care and the individual budget 
that do not necessitate a formal revision to the plan of care.  In addition, the States 
infrastructure to support families or individuals in directing and managing their plan of care is 
described here. 
21
 APPENDIX F  QUALITY ASSURANCE AND IMPROVEMENT 
APPENDIX F-1 - QUALITY ASSURANCE & IMPROVEMENT PROGRAM 
A description of the States quality assurance and improvement program is attached. This 
description includes State policies and procedures which describe the: 
1) frequency of quality assurance activities; 
2) domains/dimensions/assurances that will be monitored (e.g., access, person-centered 
service planning, provider capacity and capabilities, participant safeguards, participant 
rights, participant outcomes and satisfaction, etc.); 
3) process of discovery (including sampling methodologies and whether or not 
information is collected from interviews with families/individuals in their community 
residences); 
4) identification of the persons responsible for conducting quality assurance activities and 
their qualifications (including how families and individuals will be involved in the 
process of assessing and improving quality); 
5) provisions for periodically reviewing and revising its quality assurance policies and 
procedures when necessary; 
6) provisions for assuring that all problems identified by the discovery process will be 
addressed in an appropriate and timely manner, consistent with the severity and nature of 
deficiencies and 
7) system to receive, review and act upon critical events or incidents. 
APPENDIX F-2 ANNUAL REPORTS 
A summary of the results of the States monitoring of recipient health and welfare and the 
continuous improvement of waiver program operations will be submitted annually, as part of the 
CMS approved reporting forms/process. 
22
 APPENDIX G  FINANCIAL DOCUMENTATION 
APPENDIX G-1

COMPOSITE OVERVIEW AND DEMONSTRATION OF

COST NEUTRALITY FORMULA

LEVEL OF CARE: ________________________________________________________ 
Definitions: 
(NOTE: A separate chart should be filled out for every level of care in the waiver program.  The 
State should also include a chart reflecting the weighted average of the combined levels of care 
offered in the program.) 
Factor D  Estimated annual average per capita Medicaid cost for Home and Community-
Based Services for individuals in the waiver program. 
Factor D Estimated annual average per capita Medicaid cost for all other services provided 
to individuals in the waiver program 
Factor G  Estimated annual average per capita Medicaid cost for hospital, NF, or ICF/MR 
care that would be incurred for individuals served in the waiver, were the waiver not granted. 
Factor G  Estimated annual average per capita Medicaid costs for all services other than 
those included in Factor G for individuals served in the waiver, were the waiver not granted. 
Col. 1  Col.  2  Col.  3  Col. 4  Col. 5  Col.  6  Col. 7  Col. 8 
Year  Factor  Factor D  Total:  Factor G  Factor G  Total:  Difference 
D  G+G ?  (subtract column 
D+D 
4 from column 7) 
1 
2 
3 
4 
5 
23
 If states elect to consider Supports Brokerage and/or Fiscal/Employer Agent 
Services/Functions administratively rather than as wavier services, these costs and the 
methodology used to calculate the costs must be identified. 
Service  Estimated Costs  Methodology Description 
Supports Brokerage 
Fiscal/Employer Agent 
APPENDIX G-2 - DERIVATION OF ESTIMATES 
NUMBER OF UNDUPLICATED INDIVIDUALS SERVED 
YEAR  UNDUPLICATED  EXPLANATION of ESTIMATE of NUMBER of 
INDIVIDUALS  UNDUPLICATED INDIVIDUALS SERVED: 
1 
2 
3 
4 
5 
FACTOR D: AVERAGE COST OF WAIVER SERVICES 

Waiver Service  # Users  Avg. Units/User  Avg. Cost/Unit  Total Cost 
(Add row for 
each service) 
1 
2 
3 
4 
5 
GRAND TOTAL: 
TOTAL ESTIMATED UNDUPLICATED RECIPIENTS: 
FACTOR D (Divide total by number of recipients) 
24
 PROJECTED AVERAGE LENGTH OF STAY IN WAIVER PROGRAM: 
________________________________________________________________________ 
Please provide a narrative description and supporting documentation for the derivation of 
the following factors: 
FACTOR D  DERIVATION: 
FACTOR D DERIVATION: 
FACTOR G DERIVATION: 
FACTOR G DERIVATION: 
Appendix G-3 METHOD OF PAYMENTS (check one): 
Payments for all waiver and State plan services will be made through an approved 
Medicaid Management Information System (MMIS). 
Payments for some, but not all, waiver and State plan services will be made 
through an approved MMIS.  A description of the process by which the State will 
make payments and maintain an audit trail is attached to this Appendix. 
_____	 Payment for waiver services will not be made through an approved MMIS.  A 
description of the process by which the State will make payments and maintain an 
audit trail is attached to this Appendix. 
Appendix G-4  INDIVIDUAL BUDGET PROJECTIONS OF RESOURCES 
WITHIN THE EXCLUSIVE CONTROL OF THE FAMILY OR THE 
INDIVIDUAL. (This information is required, but will not be used in the 
calculations of cost neutrality.) 
Please estimate the proportion of families or persons who will have annual individual 
budget amounts in the following ranges: 
Budget Range  Proportion of Participants 
$1  5,000 
$5001  10,000 
$10,000  15,000 
$15,001  20,000 
$20,001  25,000 
$25,001  50,000 
25
 $50,000  75000 
$75,001  100,000 
$100,000 and above 
100% 
APPENDIX H  INDIVIDUAL BUDGETS 
The following describes in detail EITHER: 
The States uniform methodology for the calculation of individual budgets, OR 
The criteria and approval process for entities with which the State has contracted for 
day-to-day operations of the program. 
This description addresses the minimum requirements that the methodology utilize actual 
service utilization and cost data, how the methodology is explained to the family or 
individual, the re-determination process, and how the methodology is open to public 
inspection. 
26
 APPENDIX I  PARTICIPANT PROTECTIONS 
The State procedures and processes to assure that each of the following protections is in 
place are described below. 
The State has procedures to assure that families and individuals have the requisite 
information and/or tools to participate in a family or person-centered planning 
approach and to direct and manage their care as outlined in the individual plan of 
care. The State will make available and provide services such as assistance in 
locating and selecting qualified workers, training in managing the workers, 
completing and submitting paperwork associated with billing, payment and 
taxation.  Such functions are mandatory under the template and should be 
provided by one or more entities. The services and the provider qualifications are 
described in Appendix B. 
Upon family or individual request, the State makes available at no cost, provider 
qualification checks, including criminal background checks. 
The State has procedures to promote family or individual preferences and 
selections and these are appropriately balanced with accepted standards of 
practice. This balance requires deference to the individual whenever possible. 
Procedures will include individual risk management planning (e.g., risk 
agreements or informed consent contracts) to ensure that family or individual 
decisions are honored. 
The State has a viable system in place for assuring emergency back up and/or 
emergency response capability in the event those providers of services and 
supports essential to the individuals health and welfare are not available. While 
emergencies are defined and planned for on an individual basis, the State also has 
system procedures in place. 
The State has procedures for how it will work with families and their employer 
agents (if applicable) to monitor the ongoing expenditures of the individual 
budgets. 
The State has procedures for how it will handle those instances where this 
ongoing monitoring has failed to prevent the expenditure of the individual 
budget in advance of the re-determination date to assure that services 
needed to avoid out-of-home placement and the health and welfare of the 
individual are available. 
The State has procedures for how decisions will be made regarding 
unexpended resources at the time of budget re-determination. 
The State has a viable system by which it receives, reviews and acts upon critical 
events or incidents (states must describe critical events or incidents).  This system 
27
 may include an existing process (e.g. child or adult protective services). This 
system must be part of the Quality Assurance and Improvement Program. 
28
 Independence Plus: A Demonstration Program for Family or Individual 
Directed Community Services 
This initiative expedites the ability of states to offer families with a member who requires long-
term supports and services, or individuals who require long-term supports and services, greater 
opportunities to take charge of their own health and direct their own services.  Families and 
individuals will exercise greater choice, control and responsibility for their services within cost 
neutral standards.  Two template versions will be available to enable states to tailor the program to 
their preferences; the 1115 Demonstration Template and the 1915(c) Waiver Template. These 
templates further the interests of the administration, states and beneficiaries.  The program builds 
on the experience and research from a number of pioneer states that have pre-tested these concepts. 
The Goals of the Templates 
1.	 The templates will assist states to develop programs that will permit individuals needing long-
term supports and services to obtain assistance while living with their family or in their own 
home.  This will be accomplished by: 
	 Recognizing the essential role of the family or individual in the planning and purchasing of 
health care supports and services by providing family or individual control over an agreed 
resource amount. 
	 Increasing family and individual satisfaction through the promotion of personal control and 
choice -a major theme expressed during the New Freedom Initiative -National Listening 
Session. 
  Encouraging cost effective decision-making in the purchase of supports and services. 
	 Allowing eligible families and individuals to receive a cash allowance (in the 1115 
Demonstration) or individual budget (in the 1915(c) Waiver) to obtain personal assistant 
services and related supports. 
  Promoting solutions to the problem of worker availability. 
	 Providing fiscal/employer agent and supports brokerage services to support and sustain 
families or individuals as they direct their own services. 
	 Delaying or avoiding institutional or other high cost out-of-home placement by strengthening 
supports to families or individuals. 
2.	 The templates will provide states the tools, resources and guidance to create effective programs 
and continue the CMS commitment to create a culture of responsiveness by: 
	 Assisting states with meeting their legal obligations under the Americans with Disabilities Act 
(ADA) and the Supreme Court Olmstead decision. 
	 Providing flexibility for states seeking to increase the opportunities afforded families and 
individuals in deciding how best to enlist or sustain home and community services. 
	 Incorporating the essential elements of self direction such as person-centered planning, 
individual budgets, participant protections and quality assurance and improvements. 
	 Providing states with streamlined and standardized application formats to reduce the 
administrative burden for preparing proposal submissions and to reduce the Federal review 
period. 
Features of the Templates 
  Electronic format for easier submission. 
  Database platform to enable electronic tracking, sorting, querying and analyzing. 
  Structured series of check boxes to facilitate completion. 
  Pop-up instructions imbedded in the check boxes offering completion instructions. 
  Technical Guide for developing the 1915(c) Waiver or the 1115 Demonstration applications. 
	 Additional features of the 1115 Demonstration include simplified/streamlined budget 
neutrality model and sample terms and conditions.  Independence Plus 
A Demonstration Program for Family or 
Individual Directed Community 
Services Initiatives 
SECTION 1915(c) WAIVER AND  1115 DEMONSTRATION 

TEMPLATES 
QUESTIONS AND ANSWERS 
Intent of the Programs 
Q1.  Why has CMS developed these program initiatives? 
These initiatives assist states to achieve the goals established in President Bushs New 
Freedom Initiative.  The Presidents initiative is intended ... to ensure that all Americans 
have the opportunity to live close to their families and friends, to live more independently, 
to engage in productive employment and to promote community life. -President George 
W. Bush, Executive Order 13217. 
The recognition of the strengths, preferences and desired outcomes of families of persons 
with disabilities and persons with disabilities themselves is essential in the development 
and delivery of effective and meaningful services. By allowing individuals with 
disabilities, or their families, to direct the design and delivery of their own health care, they 
will experience higher levels of satisfaction, avoid unnecessary institutionalization and use 
resources more effectively. 
The above represents some of the reasons that many state officials representing the elderly 
and persons with disabilities have encouraged CMS to explore options related to self 
direction. For example, a recent survey of State Medicaid Directors, Mental 
Retardation/Developmental Disabilities Administrators and Vocational Rehabilitation 
Administrators indicated that 69% of the responding administrators were interested in 
advancing self-directed programs for persons with disabilities and 64% supported self-
directed programs for older persons. State officials expressed concern that complex 
Medicaid laws present barriers to promote this service delivery method and that the 
Federal government should simplify the process for approving applications for states to 
establish or amend Home and Community-Based Services (HCBS) and other waiver 
programs.  The programs will: 
	 Delay institutional or other high cost out-of-home placement by strengthening 
supports to families or individuals, permitting the individual with a disability to live 
in their familys or own home. 
	 Recognize the essential role of the family or individual in the planning and 
purchasing of health care services and supports by providing control over an agreed 
upon resource amount. 
  Facilitate cost effective decision-making in the purchase of supports and services. 
	 Increase family and individual satisfaction by facilitating control and choice, 
concepts voiced by many persons participating in a National Listening Session -
New Freedom Initiative. 
	 Facilitate the states abilities to meet legal obligations under the Americans with 
Disabilities Act (ADA) and the Supreme Court Olmstead decision. 
Q2.  Why are two different templates provided (1915(c) and 1115)? 
Sections 1115 and 1915(c) of the Social Security Act provide states two options to 
establish family or individual directed community supports, however, the 1115 
Demonstration option provides optimum flexibility. The 1115 Demonstration Template 
must be used if the State wishes to: 
	 Establish a program serving multiple populations, such as person with mental 
retardation and person with physical disabilities or 
	 Establish a program making cash directly available to demonstration 
participants  or 
	 Cover an eligible population other than those who meet an institutional level of 
care. 
Section 1115  1915(c) HCBS Waiver 
Demonstration Authority  Authority 
Level of Care  Any Level of Care  People Meeting Institutional 
Level of Care 
Services Which May be  State Plan Services  HCBS Waiver Services 
Self-directed  Only 
Cash  Participant May or May Not  Participant Uses 
Manage the Cash Directly  Fiscal/Employer Agent and 
Does Not Manage Cash 
Directly 
Q3.  What is new or innovative about this initiative? 
This initiative provides guidance and assistance to states wishing to implement programs 
to support the self direction of services and supports by persons with disabilities and their 
families. 
Q4.  What is meant by self direction? 
Self direction refers to a service delivery system whereby families, elderly persons or 
persons with disabilities have high levels of direct involvement, control and choice in  identifying, accessing and managing the services they obtain to meet their personal 
assistance and other health related needs. 
Q5.  Has DHHS permitted or approved this type of service delivery system previously? 
Yes.  The National Cash and Counseling Demonstration and Evaluation Project, co
sponsored by DHHS and the Robert Wood Johnson Foundation (RWJF), operates in the 
states of Arkansas, Florida and New Jersey under the authority of Section 1115 of the 
Social Security Act. This demonstration uses an experimental approach to randomize 
enrollees into a treatment or a control group. Treatment group participants are elderly and 
younger Medicaid beneficiaries with significant long-term functional disabilities with 
family caregivers serving as representatives, if necessary. Participants of the Project self-
direct their own home and community personal assistance services and supports utilizing 
a cash allowance to purchase services or items needed to meet their personal care needs. 
An equal number of recipients are randomized into the Control Group.  These individuals, 
while preferring to receive the cash allowance, remain in the traditional service delivery 
program.  The evaluation compares the level of satisfaction, utilization and expenditures 
between the two groups. Similarly, a number of pioneer states are developing self-
determination programs under the 1915(c) authority and are allowing individuals to 
manage their services. These initiatives and their related experiences have been 
instrumental in the design of the templates. 
Q6.	 How does this initiative differ from the existing Cash and Counseling 
Demonstration and Evaluation Programs? 
The two new templates are similar to the Cash and Counseling Demonstration and 
Evaluation Program but include some refinements based on the experiences of the 
participating states and states developing self-determination models.  Each incorporates 
direct family or individual involvement as an essential element of the program design. The 
new templates, however, do not require participant assignment into a treatment or control 
group. 
Q7.	 Do the templates cover individuals who are currently institutionalized and wish to 
move into the community and enroll in a demonstration program? 
Yes, the templates may be used to assist persons living in institutions to return to the 
community. The individuals must, however, be returning to their own home or the home of 
their families. 
Relationship to State Program Initiatives 
Q8.  How will these templates help states? 
CMS developed these templates to further efforts toward building a culture of 
responsiveness by creating an application that reduces the state administrative burden for 
submission and the Federal review period.  Specific features of the templates include: 
  Electronic format for easier submission.    Structured series of check boxes to be completed. 
	 Database platform for the electronic submission to enable electronic tracking, 
sorting, querying, and analyzing of each application (to be developed by mid-
2002). 
  Technical Guide to develop the application or the Operations Protocol. 
  For the 1115 Demonstration Template, the following is added: 
o	 Pop-up instructions imbedded in the check boxes on how to complete 
each question. 
o  Simplified budget neutrality models. 
o	 Sample set of assurances or terms and conditions specific to self 
direction. 
Q9.  Can a state already do what is proposed under these templates? 
Yes. However, states and their partnering organizations have often been confused by the 
existing array of choices and requirements. It has also been unclear to states as to how self 
direction can fit within traditional waiver or demonstration frameworks. These templates 
and the related material will provide guidance and administrative simplification. In 
addition, states would not be required to randomly assign individuals into experimental 
groups (treatment and control), but must allow individuals to participate in alternate 
research strategies. 
Q10.  Are states required to provide matching funds? 
Yes. This initiative is part of Medicaid and must comply with basic Medicaid 
requirements. In terms of payment, the state makes payments for services then the Federal 
Government matches those expenditures according to the states Federal Medicaid 
assistance payment rate. 
Q11.	 How should a state proceed if it wishes to amend an existing 1915(c) Waiver or 1115 
Demonstration to incorporate one of the elements of self direction (e.g., 
Fiscal/Employer Agent, Individual Budget or Supports Brokerage)? 
States wishing to add one of the new self-directed components prior to the renewal period 
should contact CMS to discuss the anticipated changes. To understand fully the proposed 
modifications, CMS staff may request submission of a written concept paper. The decision 
will then be made to identify the most appropriate method by which the state will submit 
the changes and the required documentation. Options may include (a) converting to the 
new template or (b) amending an existing wavier to incorporate essential elements of the 
self-directed approach. 
Q12.	 If a state wishes to renew an existing 1915(c) Waiver or a 1115 Demonstration to 
include one of the elements of self direction or wishes to renew an existing wavier 
that includes a self direction component, should the template be used? 
Yes.  Either the 1915(c) Waiver or the 1115 Demonstration Template must be used to 
renew an existing waiver or demonstration if the state wishes to add one of the self-
directed components or has, in the past, offered a self-directed waiver service.  Accountability 
Q13.  How does the Independence Plus Initiative assure state fiscal accountability? 
Use of the Independence Plus 1115 Demonstration or the 1915(c) Waiver application will 
maintain state fiscal responsibility by continuing to require states to meet statutory or 
regulatory requirements. Budget neutrality policy for the 1115 Demonstration limits 
Federal expenditures so that they do not exceed the levels that would have been realized 
had there been no demonstration. The similar requirement for the 1915(c) version is cost 
neutrality, which requires Federal funding to be no more than the institutional costs that 
would have been incurred for waiver participants. In addition, states must ensure the 
availability of fiscal/employer agent services and options for supports brokerage for the 
individual. 
Q14.	 How does the Independence Plus initiative assure for the health and welfare of the 
individual with the disability? 
Use of the 1115 Demonstration or the 1915(c) Waiver Templates require states to design 
and implement a quality assurance or improvement program and to implement procedures 
related to participant protections. 
As part of the template application process states will be required to develop procedures to 
assure that families have the requisite information and/or tools to participant in a family or 
person-centered planning approach and to direct and manage their care as outlined in the 
individual plan of care.  The state should make available and provide services such as 
assistance in locating and selecting qualified workers, training in managing workers, 
completing and submitting paperwork associated with billing, payment and taxation. 
Supports Brokerage and Fiscal/Employer Services/Functions are required and should be 
provided by one or more entities. 
Upon family or individual request, the state will make available, at no cost, provider 
qualification checks, including criminal background checks. 
The state will have procedures to promote family and individual preferences and selections 
and these will be appropriately balanced with accepted standards of practice.  This balance 
requires deference to the individual whenever possible. Procedures will include individual 
risk management planning (e.g., risk agreements or informed consent contracts) to ensure 
that family or individual decisions are honored. 
The state will have a viable system in place for assuring emergency back-up and/or 
emergency response capability in the event those providers of services and supports 
essential to the individuals health and welfare are not available. While emergencies are 
defined and planned for on an individual basis, the state also will have system procedures 
in place. 
The state will have procedures for how it will work with families or individuals and their 
fiscal/employer agents (if applicable) to monitor the ongoing expenditures of the individual 
budget.  The state will have procedures for how it will handle those instances where ongoing 
monitoring has failed to prevent the expenditure of the individual budget in advance of the 
re-determination date to assure that services needed to avoid out-of-home placement and 
the health and welfare of the individual are available. 
The state will have procedures for how decisions will be made regarding unexpended 
resources at the time of budget re-determination. 
The state, through an organized quality assessment program, will provide appropriate 
oversight and monitoring of its HCBS Waiver Program to ensure that each of the 
assurances contained in the application is met and to continually improve the operation of 
the program. The program will involve families or individuals in the process of assessing 
and improving quality. The state will assure that all problems identified by this monitoring 
will be addressed in an appropriate and timely manner, consistent with their severity and 
nature and will contain an incident management system to address critical events. 
Q15.  Will the states be limited in the size of the enrollment under one or both templates? 
Yes. Existing regulations for the 1915(c) Waivers require states to indicate the number of 
unduplicated beneficiaries to which it intends to provide waiver services in each year of its 
program.  This number in the application will constitute a limit on the size of the waiver 
program. Future state requests to increase the limit would require a waiver amendment. 
States must include their proposed limits in the 1115 Demonstration Template application 
for discussion with CMS staff. Again, future state requests to increase the limit will 
require a demonstration amendment. The state will also be asked to submit the results of 
an independent evaluation demonstrating that the program has remained within budget and 
cost neutrality parameters and the programs ability to adequately address the health, 
welfare, and satisfaction of the participants.