DEPARTMENT OF HEALTH & HUMAN SERVICES 
Centers for Medicare & Medicaid Services 
7500 Security Boulevard, Mail Stop S2-26-12 
Baltimore, Maryland 21244-1850 
 
 
 
Center for Medicaid and CHIP Services 
 
CMCS Informational Bulletin 
 
 
DATE:  June 18, 2012 
 
FROM:  Cindy Mann, Director 
    Center for Medicaid and CHIP Services (CMCS) 
 
SUBJECT:   New Housing Resources to Support Olmstead Implementation 
 
For more than a decade, the Centers for Medicare & Medicaid Services (CMS) has been 
partnering with States to use Medicaid funding and services to develop comprehensive long-term 
services and supports systems that are compliant with the Americans with Disabilities Act 
(ADA) and the historic June 22, 1999 Olmstead vs L.C. U.S. Supreme Court decision 
(Olmstead), which requires States to administer programs in the most integrated setting 
appropriate to the needs of qualified individuals with disabilities.  CMS also recognizes the 
critical role of the U.S. Department of Housing & Urban Development (HUD) in providing the 
housing support individuals need to help them remain in the community.  At the federal level, the 
U.S. Department of Health and Human Services (HHS) and HUD have been working together to 
forge a strong collaboration in support of achieving the promise of the Olmstead decision.  This 
Informational Bulletin provides a description of recent HUD actions, policies and resources that 
are available as States develop strategies to balance their long-term services and supports 
systems. 
 
As States continue to implement the Olmstead decision and reform and rebalance their long-term 
care systems, establishing and maintaining relationships with the housing community and 
leveraging the many housing opportunities available through HUD and State housing finance 
agencies will be critical to States success.   Many States have had success in using Money 
Follows the Person administrative funding to support staff who can focus on leveraging the 
housing resources in a State.  And housing agencies may be increasingly receptive to forging 
partnerships with State Medicaid agencies as their future funding opportunities may depend on 
having such relationships.  As discussed below, HUD recently provided a funding opportunity 
for rental assistance for very low-income individuals who require housing finance agency 
applicants to create a partnership with the State Medicaid program.  We hope the information 
provided here will be useful to State Medicaid programs as they continue to improve access to 
home and community-based services for people with disabilities. 
  CMCS Informational Bulletin  Page 2 
Background 
Medicaid plays a vital role in States efforts to provide and expand home and community-based 
services for people with disabilities and low-income older Americans.  Even before the Olmstead 
decision was issued, CMS (then the Health Care Financing Administration or HCFA) published 
guidance to States on the implementation of Title II of the ADA in a State Medicaid Director 
Letter issued on July 29, 1998.  Subsequently, in response to the Olmstead decision, CMS issued 
a series of Olmstead Letters as guidance to States, identifying policies and providing technical 
support, tools and resources to States, to support their efforts to build robust, community-based 
systems that support community integration and community living.  More recently, CMS issued 
the Community Living Initiative State Medicaid Director Letter on May 20, 2010, which 
reaffirmed our commitment to partner with States to comply with the ADA, and achieve the 
promise of Olmstead.  Since issuing the Community Living Initiative letter, CMS, in 
collaboration with the HHS partners listed in the letter, has developed a significant partnership 
with HUD.  In the past decade, CMS has administered nearly $5 billion in grants to States, such 
as the Money Follows the Person, Real Choice Systems Change and Medicaid Infrastructure 
grants, to improve the infrastructure and long-term services and supports systems to support 
States to implement the requirements of the Olmstead decision.  These efforts clearly 
demonstrate the importance of the availability of affordable, accessible housing, and the need for 
strong relationships between agencies that provide housing and services.   
 
HUD Actions in support of community integration and Olmstead Implementation 
HUD fully supports States efforts to implement and comply with Olmstead, and has issued a 
series of guidance documents to States, public housing agencies, and other jurisdictions 
regarding the critical role of accessible, affordable housing in these efforts.  These 
communications provide suggestions and expectations related to the deployment of HUD 
resources to support States efforts to de-institutionalize persons with disabilities and ensure that 
persons at serious risk of institutionalization remain in community-based settings in accordance 
with Title II of the ADA.  This first section provides information on recent HUD policies and 
communications, and the second section provides information on newly available resources. 
 
Recent HUD Communications Related to Olmstead and Community Living 
 
Guidance to FHEO Regional and Field Office Directors.   
On August 11, 2011, HUDs Office of Fair Housing and Equal Opportunity (FHEO) issued 
guidance to FHEO staff on ways to assist persons with disabilities transitioning from institutions 
and persons at serious risk of institutionalization.  The guidance provides background on the 
Olmstead decision and FHEOs role in conducting Section 504 and Title II ADA monitoring and 
compliance reviews.  The letter outlines specific activities FHEO staff may identify to public 
housing agencies regarding outreach, accessibility feature needs, occupancy of accessible units, 
reasonable accommodation policies, and accessible housing listing and waiting lists, all of which 
would impact persons transitioning into the community.  The letter also offers specific activities 
that may be incorporated into Section 504 and Title II ADA voluntary compliance agreements, 
including, among other things, incorporating an admission preferences for persons with 
disabilities transitioning from institutions. 
  CMCS Informational Bulletin  Page 3 
Secretary Donovans Letter to Public Housing Agencies.   
On June 22, 2009, Secretary Shaun Donovan issued a letter to public housing agencies as part of 
a joint effort between HUD and HHS to share information about the Money Follows the Person 
rebalancing demonstration program and to identify how public housing agencies can support this 
crucial effort.  The letter urges public housing agencies to provide a local admission preference 
to people making the transition from institutions into community-based settings. 
 
Notice Regarding Olmstead and Community Planning and Development Grants.   
CPD Notice 2008-05 (Original Notice CPD-2005-03) explains ways that funding through HUDs 
Office of Community Planning and Development (CPD) programs can be utilized to respond to 
Olmstead.  
 
Notice to Public Housing Agencies on Use of Housing Choice Vouchers for People with 
Disabilities.   
PIH Notice 2005-5 on Community-Based Alternatives for Individuals with Disabilities and the 
Housing Choice Voucher Program provides guidance to public housing agencies and HUD field 
staff on initiatives that can be implemented to assist families with a person with disabilities 
searching for housing. 
 
HUD Resources That Can Support Community Living 
 
Background on Section 811 Supportive Housing for Persons with Disabilities Program  
The Section 811 Supportive Housing for Persons with Disabilities program provides funding to 
develop and subsidize rental housing with the availability of supportive services for very low-
income adults with disabilities.  The Frank Melville Supportive Housing Investment Act 
modernized and reformed the 811 program, creating opportunities to develop thousands of new 
permanent supportive housing units within affordable housing properties every year.  The newly 
authorized Section 811 program changes include:  
 
  Providing stronger incentives to leverage other sources of capital for 811 units, including 
federal Low-Income Housing Tax Credits, HUD HOME funds, and bond financing, and    
  A new Project-Based Rental Assistance (PRA) approach to help State and local 
governments systematically create integrated supportive housing units within affordable 
rental housing developments. 
 
To further integrate housing opportunities, the Section 811 program establishes a 25% cap on the 
total number of units in any multifamily housing project that can receive Section 811 assistance 
or be subject to any occupancy preference for persons with disabilities. 
 
New Notice of Funding Availability (NOFA) for 811 Project Rental Assistance (PRA) and 
Partnerships with State Medicaid Agencies.   
HUD recently published a Notice of Funding Availability (NOFA) for 811 Project Rental 
Assistance (PRA).  This competitive funding opportunity invites the State Housing Finance 
Agency (HFA) or other appropriate housing agency to establish integrated supportive housing 
units for non-elderly persons with disabilities in affordable rental housing developments.  The 
PRA option requires a joint State agency partnership (a formal written agreement) between the  CMCS Informational Bulletin  Page 4 
State Housing Finance Agency (or other appropriate entity as determined by the HUD Secretary) 
and the State health and human services agency as well as (if different) the State agency 
responsible for the administration of the Medicaid State plan.  The State Housing Finance 
Agency must have a formal written agreement with the State health and human services/ 
Medicaid agency.  The agreement must address:  
 
  The target populations to be served.   
  Outreach and referral methods for reaching the target populations.   
  Supportive service commitments for tenants. 
 
Only one application from each State will be eligible to receive funding.  In the event that there 
is more than one application, the State health and human Services (State Medicaid Agency) 
agency will decide which application the State will support.  Inquiries on the HUD Section 811 
NOFA may be sent to PRADemoapplications@hud.gov.   
 
Background on Housing Choice Vouchers 
Housing choice vouchers (HCV), sometimes referred to as Section 8 vouchers, allow very low-
income families to lease or purchase safe, decent, and affordable privately owned rental housing.  
HCVs are administered locally by public housing agencies (PHA).  Certain special purpose 
HCVs have been awarded to PHAs to specifically serve the non-elderly disabled population.  
These are called Non-Elderly Disabled (NED) vouchers.  NED vouchers are vouchers 
specifically set-aside for persons with disabilities.  
 
Recently Issued NED Vouchers.   
NED Vouchers under the FY2009 NOFA were set aside for two categories of individuals with 
disabilities:  
 
  Category 1 NED:  4,321 vouchers were awarded in October 2010 to help non-elderly 
people with disabilities to access affordable housing in the private market, including 
individuals in the community at risk of institutionalization.  These vouchers were 
awarded in 19 States, Washington, D.C, and Puerto Rico. 
  Category 2 NED:  948 vouchers were awarded in February 2011 specifically to support 
individuals transitioning into the community from institutional long-term care settings.  
These vouchers were unique in that applicant PHAs were required to identify the 
partnering human service agency.  These vouchers were awarded in 15 States.  CMS is 
providing technical assistance to many of these States to help them link these vouchers 
with the necessary long-term services and supports that enable individuals with 
disabilities to live successfully in the community. 
 
Policy Regarding Maintaining Vouchers for NED Families & Other Special Populations.  
In June 2011, HUD issued PIH Notice 2011-32 Policies and Procedures for Special Purpose 
Housing Choice Vouchers (HCV) for Non-Elderly Disabled Families and Other Special 
Populations which provides guidance to PHAs that all vouchers awarded from appropriations 
from FY 1997 or any subsequent year for non-elderly disabled families, must be reestablished as 
NED vouchers and remain with the NED population upon turnover.  Since 1997, around 400 
PHAs have been awarded a total of approximately 55,000 vouchers specifically for non-elderly  CMCS Informational Bulletin  Page 5 
disabled families.  PHAs may serve non-elderly persons with disabilities transitioning from 
institutions with NED vouchers by establishing a preference for a dedicated number of their 
NED vouchers and adopting the preference in accordance with regular HCV program 
requirements.  This Notice establishes policies and procedures for issuing, re-issuing, tracking 
and monitoring HCVs that were awarded under a NOFA to provide rental assistance for persons 
with disabilities.  These efforts impact persons with disabilities transitioning from institutions as 
well as persons with disabilities at serious risk of institutionalization who are seeking housing in 
their communities. 
 
Other Resources Related to Housing for People with Disabilities 
 
  Real Choice Systems Change Grants:  These grants, issued by CMS in 2004 and 2011, 
provided funding to support States, public housing and housing finance agencies to work 
collaboratively, establish relationships, and develop common goals toward accessible, 
affordable housing. 
  Housing Capacity Building Initiative for Community Living:  This joint HUD-HHS 
initiative supports federal, State and local agencies and community partners to create 
sustainable, collaborative relationships between housing and human services agencies. 
  Local HUD Offices:  The HUD Portal provides information for connecting with the local 
HUD office in your region. 
 
HUD and HHS continue to work together on further Olmstead-related initiatives, and we will 
continue to share information as it becomes available.  We will build on our collaborative efforts 
to connect housing resources and home and community-based services at the State and local 
level to continue to generate sustainable, accessible housing with services to best serve people 
with disabilities.