DEPARTMENT OF HEALTH & HUMAN SERVICES 
                                                                                    Health Care Financing Administration 
___________________________________________________________________________ 
                                                                               Center for Medicaid and State Operations 
                                                                                                             7500 Security Boulevard 
                                                                                                            Baltimore, MD 2 1244-1850 
 
JUL 2 9 1998 
 
Dear State Medicaid Director: 
 
In the Americans with Disabilities Act (ADA), Congress provided that "the Nation's 
proper goals regarding individuals with disabilities are to assure equality of opportunity, 
frill participation, independent living, and economic self-sufficiency for such 
individuals." 42 U.S.C.  12101(a)(8). Title II of the ADA further provides that "no 
qualified individual with a disability shall, by reason of such disability, be excluded from 
participation in or be denied the benefits of the services, programs or activities of a 
public entity, or be the subject of discrimination by any such entity." 42 U.S.C.  12132. 
Department of Justice regulations implementing this provision require that "a public 
entity shall administer services, programs, and activities in the most integrated setting 
appropriate to the needs of qualified individuals with disabilities." 28 C.F.R.  35.130(d). 
 
We have summarized below three Medicaid cases related to the ADA to make you aware 
of recent trends involving Medicaid and the ADA. 
 
In L.C. & E.W. v. Olmstead. patients in a State psychiatric hospital in Georgia 
challenged their placement in an institutional setting rather than in a community-
based treatment program. The United States Court of Appeals for the Eleventh 
Circuit held that placement in an institutional setting appeared to violate the 
ADA because it constituted a segregated setting, and remanded the case for a 
determination of whether community placements could be made without 
fundamentally altering the State's programs. The court emphasized that a 
community placement could be required as a "reasonable accommodation" to the 
needs of disabled individuals, and that denial of community placements could 
not be justified simply by the State's fiscal concerns. However, the court 
recognized that the ADA does not necessarily require a State to serve everyone 
in the community but that decisions regarding services and where they are to be 
provided must be made based on whether community-based placement is 
appropriate for a particular individual in addition to whether such placement 
would fundamentally alter the program. 
 
In Helen L. v. DiDario, a Medicaid nursing home resident who was paralyzed 
from the waist down sought services from a State-funded attendant care program 
which would allow her to receive services in her own home where she could 
reside with her children. The United States Court of Appeals for the Third 
Circuit held that the State's failure to provide services in the "most integrated  Page 2 State Medicaid Director 
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 setting appropriate" to this individual who was paralyzed from the waist down 
violated the ADA, and found that provision of attendant care would not 
fundamentally alter any State program because it was already within the scope 
of an existing State program. The Supreme Court declined to hear an appeal in 
this matter; thus, the Court of Appeals decision is final. 
 
 In Easley v. Snider, a lawsuit, filed by representatives of persons with disabilities 
deemed to be incapable of controlling their own legal and financial affairs, 
challenged a requirement that beneficiaries of their State's attendant care program 
must be mentally alert. The Third Circuit found that, because the essential nature 
of the program was to foster independence for individuals limited only by 
physical disabilities, inclusion of individuals incapable of controlling their own 
legal and financial affairs in the program would constitute a fundamental 
alteration of the program and was not required by the ADA. This is a final 
decision. 
 
While these decisions are only binding in the affected circuits, the Attorney General has 
indicated that under the ADA States have an obligation to provide services to people with 
disabilities in the most integrated setting appropriate to their needs. Reasonable steps should be 
taken if the treating professional determines that an individual living in a facility could live in the 
community with the right mix of support services to enable them to do so. The Department of 
Justice recently reiterated that ADA's "most integrated setting" standard applies to States, 
including State Medicaid programs. 
 
States were required to do a self-evaluation to ensure that their policies, practices and procedures 
promote, rather than hinder integration. This self-evaluation should have included consideration 
of the ADA's integration requirement. To the extent that any State Medicaid program has not 
fully completed its self-evaluation process, it should do so now, in conjunction with the disability 
community and its representatives to ensure that policies, practices and procedures meet the 
requirements of the ADA. We recognize that ADA issues are being clarified through 
administrative and judicial interpretations on a continual basis. We will provide you with 
additional guidance concerning ADA compliance as it becomes available. 
 
I urge you also, in recognition of the anniversary of the ADA, to strive to meet its objectives by 
continuing to develop home and community-based service options for persons with disabilities to 
live in integrated settings. 
 
If you have any questions concerning this letter or require technical assistance, please contact 
Mary Jean Duckett at (410) 786-3294. 
 
Sincerely, 
 
   
Sally K. Richardson 
Director 
 
cc All HCFA Regional Administrators 
 
All HCFA Associate Regional Administrators 
for Medicaid and State Operations  Page 3 State Medicaid Director 
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Lee Partridge 
American Public Human Services Association 
 
Joy Wilson 
National Conference of State Legislatures 
 
Jennifer Baxendell 
National Governors' Association