Olmstead Update No: 
3 Subject: HCFA 
Update Date: July 25, 
2000  
Dear State Medicaid Director:  
On January 14, 2000, we transmitted the first in a series of letters describing the Supreme Court's decision in the 
case of Olmstead v. L.C. We observed the fact that Medicaid may be of great assistance to States in fulfilling their 
civil rights responsibilities under the Americans with Disabilities Act (ADA). We also promised to review federal 
Medicaid policies and regulations to identify areas in which policy clarification or modification would facilitate 
your efforts to enable persons with disabilities to be served in the most integrated settings appropriate to their 
needs.  
This letter summarizes some of the recent Health Care Financing Administration (HCFA) efforts to review 
Federal policies in order to facilitate fulflilment of the ADA. These efforts have been directed towards 
supporting States' initiatives in the following critical areas:  
  Assisting people with disabilities to make a successful transition from nursing homes and other institutions 
into the community;  
  Expanding the availability and quality of home and community-based services; and  
  Ensuring that services are comparably available to all.  
 
The attached enclosures consist of policy changes and clarifications that HCFA is making that will give States 
more flexibility to serve people with disabilities in different settings. These serve as guidance on how States may 
use the flexibility that Medicaid offers to expand services in a variety of ways.  
We appreciate the ideas that you and members of the disability community have contributed so far. Most of the 
clarifications and policy reforms described in this letter emanate from your communications. We continue to invite 
new ideas because further policy work is required.  
We have established an ADA/Olmstead website that contains questions and answers in response to inquiries 
received since the January 14th letter. The address is http://www.hcfa.gov/medicaid/olmstead/ olmshome.htm. The 
website also contains related letters to State Medicaid Directors and Governors and links to other relevant websites. 
We encourage you to continue forwarding your policy-related questions  
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and recommendations to the Olmstead workgroup through e-mail at ADA/Olmstead@hcfa.gov or 
in written correspondence to:  
DHHS Working Group for ADA/Olmstead  
c/o Center for Medicaid and State Operations  
HCFA, Room S2-14-26, DEHPG  
7500 Security Boulevard   Baltimore, MD 21244-1850 
 
We look forward to a continuation of our work together to improve the nation's community-
based services system.  
Sincerely,  
Timothy M. 
Westmoreland Director  
Enclosures  
cc: All HCFA Regional Administrators All HCFA Associate Regional Administrators Division of 
Medicaid and State Operations American Public Human Services Association Association of State 
& Territorial Health Officials National Association of State Alcohol and Drug Abuse Directors, 
Inc. National Association of State Directors of Developmental Disabilities Services National 
Association for State Mental Health Program Directors National Association of State Units on 
Aging National Conference of State Legislatures National Governors' Association  
 
HCFA POLICY CHANGES AND CLARIFICATIONS ATTACHED TO THIS LETTER 
 
 
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Purpose: Assisting people with disabilities to make a successful transition from nursing homes 
and other institutions into the community.   Attachment 3-a: Earliest  
Eligibility Date in HCBS  
Waivers. 
Attachment 3-b: Community  
Transition 
Attachment 3-c: Personal  
Assistance Retainer.       
Discusses a policy change regarding the earliest date of service for which Federal financial  participation (FFP) can be claimed.  
Explains some of the ways that Medicaid funding may be used to help elderly people and 
individuals with a disability transition from an institution to a community residence.  
Discusses a HCFA policy change indicating that a State may make payment for personal assistance 
services under a Medicaid HCBS waiver while a waiver participant is temporarily hospitalized or 
away from home.  
 
 
Purpose: Expanding the 
availability and quality of 
home and community-
based service.  
Attachment 3-d: Habilitation. Clarifies that habilitation services, including prevocational, 
educational, and supported employment services, are available 
under an HCBS waiver to people of all ages, in all target 
groups, if so specified by the State.  
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Attachment  3-e:  Out  -of-  State  
Services.   
 
 
Purpose: Ensuring that services are comparably available to all.  
Attachment 3-f: Services Provided Under a Nurse's Authorization.  
Attachment 3-g: Prohibition of Homebound Requirements in Home Health. 
Clarifies the circumstances under which Medicaid HCBS 
waiver services may be provided out-of-state.   Clarifies that States may receive FFP for services provided at the authorization of a nurse, if the 
providers meet qualifications specified under the State Plan or Medicaid waiver for these services.  
Notifies that the use of a "homebound" requirement under the Medicaid home health benefit 
violates Federal regulatory requirements at 42 CFR 440.230(c) and 440.240(b).  
 
   
 
 
. Attachment 3-a Subject: Earliest Eligibility Date in HCBS 
Waivers -- Policy Change Date: July 25, 2000  
Timely home and community-based services (HCBS) waiver eligibility determinations are 
particularly important to ensure that individuals awaiting imminent discharge from a hospital, 
nursing home, or other institution are able to return to their homes and communities.  
Consequently, we have been asked to clarify the earliest date of service for which Federal 
financial participation (FFP) can be claimed for HCBS and other State plan services when a 
person's Medicaid eligibility is predicated upon receipt of Medicaid HCBS under a waiver.  
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Under current Health Care Financing Administration policy, States must meet several criteria 
(described below) before they can receive FFP for HCBS waiver services furnished to a beneficiary 
who has returned to the home or community setting. For example, section 1915(c)(1) of the Social 
Security Act (the Act) requires that HCBS waiver services be furnished pursuant to a written plan 
of care.  
Policy Change: To facilitate expeditious initiation of waiver services, we will accept as meeting the 
requirements of the law a provisional written plan of care which identifies the essential Medicaid 
services that will be provided in the person's first 60 days of waiver eligibility, while a fuller plan 
of care is being developed and implemented. A comprehensive plan of care must be in place in 
order for waiver services to continue beyond the first 60 days.  
The following chart summarizes the above and other requirements.  
 
Earliest Date of HCBS Waiver Eligibility =  
The Last Date All of the Following Requirements Have Been Met 
 
(cid:31)  1. Basic Medicaid Eligibility: The person is determined to be Medicaid-eligible if in a 
medical institution.  
(cid:31)  The eligibility group into which the person falls must be included in the State plan.  
(cid:31)  2. Level of Care: The person is determined to require the level of care provided in a hospital, 
nursing facility, or ICF/MR.   (cid:31)  Level of care determinations must be made as specified in the approved waiver.  
(cid:31)  3. Special Waiver Requirements: The person is determined to be included in the target group 
and has been found to meet other requirements of eligibility specified in the State's approved 
waiver. These requirements include documentation from the individual that he or she chooses to 
receive waiver services.  
(cid:31)  The person must actually be admitted to the waiver.  
2   Plan of Care: A written plan of care is established in conformance with the policies and 
procedures established in the approved waiver.  
 
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Policy Change: For eligibility determinations we will initially accept a provisional written plan of 
care which identifies the essential Medicaid services that will be provided in the person's first 60 
days of waiver eligibility, while a fuller plan of care is being accomplished. A comprehensive care 
plan, designed to ensure the health and welfare of the individual, must be developed within this 
time.  
5. Waiver Service: The plan of care must include at least one waiver service to be furnished 
to the individual, and the State must take appropriate steps to put the plan of care into effect.  
When the eligibility determination has been made finding the individual eligible for the Medicaid 
HCBS waiver, the State may make a claim for FFP for services furnished beginning on the date on 
which all of these criteria are met. In subsequent attachments, we provide for special procedures to 
accommodate reimbersement for certain transition expenses that enable an individual residing in an 
institution to transition to community residence.  
Any questions concerning this attachment may be referred to Mary Jean Duckett at (410) 786-
3294 or Mary Clarkson at (410) 786-5918.  
 
Attachment 3-b Subject: Community 
Transition -- Policy Change Date: July 25, 
2000  
Medicaid home and community-based services (HCBS) waivers are statutory alternatives to 
institutional care. Many States have found HCBS waivers to be a cost-effective means to provide 
comprehensive community services in the most integrated setting appropriate to the needs of the 
individuals enrolled.  
Nursing facilities and intermediate care facilities for the mentally retarded (ICFs/MR) likewise 
play important roles in our long term care system. They are particularly important for short-term 
rehabilitation, sub-acute care, and crisis management that enable timely hospital discharge.  However, short-term stays often become long term residence when complicated planning is 
required for a return home, special housing or housing modification needs to be arranged, or 
exceptional one-time expenses must be paid.  
This attachment explains several means by which Medicaid may assist States to overcome these 
barriers to community transition. It addresses the following:  
A. Case Management  
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1  Targeted Case Management Under the State Plan  
2  HCBS Case Management  
3  Administrative Case Management  
 
B. Assessments for Accessibility  
C. Environmental Modifications  
D. Modifications Interrupted due to Death  
A. Case management. Case management services are defined under section 1915(g)(2) of the 
Social Security Act (the Act) as "services which will assist individuals, eligible under the plan, in 
gaining access to needed medical, social, educational, and other services." Case management 
services are often used to foster the transitioning of a person from institutional care to a more 
integrated setting or to help maintain a person in the community. There are several ways that case 
management services may be furnished under the Medicaid program:  
1) Targeted case management (TCM), defined in section 1915(g) of the Act, may be 
furnished as a service to institutionalized persons who are about to leave the 
institution, to facilitate the process of transition to community services and to enable 
the person to gain access to needed medical, social, educational and other services in 
the community. We are revising our guidelines to indicate that TCM may be furnished 
during the last 180 consecutive days of a Medicaid eligible person's institutional stay, 
if provided for the purpose of community transition. States may specify a shorter time 
period or other conditions under which targeted case management may be provided. Of 
course, FFP is not available for any Medicaid service, including targeted case 
management services, provided to persons who are receiving services in an institution 
for mental disease (IMD), except for services provided to elderly individuals and 
children under the age of 21 who are receiving inpatient psychiatric services.  
2) HCBS Case Management may be furnished as a service under the authority of 
section 1915(c) when this service is included in an approved HCBS waiver. Persons 
served under the waiver may receive case management services while they are still  institutionalized, for up to 180 consecutive days prior to discharge. However, Federal 
financial participation (FFP) is available on the date when the person leaves the 
institution and is enrolled in the waiver. In such cases, the case management service 
begun while the person was institutionalized is not considered complete until the 
person leaves the institution and is enrolled in the waiver. In these cases, the 
cumulative total amount paid is claimed as a special single unit of transitional case 
management. To claim FFP for case management services under the waiver, the State 
may consider the unit of service complete on the date  
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the person leaves the facility and is enrolled in the waiver, and claim FFP for this unit 
of case management services furnished on that date. The cost of case management 
furnished as a HCBS waiver service must be estimated in factor D of the waiver's 
cost-neutrality formula.  
3) Administrative Case Management may be furnished as an administrative activity, 
necessary for the proper and efficient administration of the State Medicaid plan. 
When case management is furnished in this fashion, FFP is available at the 
administrative rate, but may only be claimed for the establishment and coordination 
of Medicaid services that are not services funded by other payors for which the 
individual may qualify. Case management furnished as an administrative expense 
may be eligible for FFP even if the person is not eventually served in the community 
(e.g., due to death, the individual's choice not to receive waiver services, loss of 
Medicaid eligibility, etc.). This is because the service is performed in support of the 
proper and efficient administration of the State plan.  
When a State elects to provide case management as both an administrative and a 
service expense (either under the targeted case management State plan authority, or 
as a service under a HCBS waiver), the State must have a policy on file with HCFA 
that clearly delineates the circumstances under which case management is billed as 
either an administrative or a service expense. This information must be included in 
the supporting documentation that the State forwards with its State plan or waiver 
request.  
B. Assessments for Accessibility. Environmental modifications are often crucial to a State's ability 
to serve an individual in the most integrated setting appropriate to his/her needs. The State may 
assess the accessibility and need for modification in a person's home or vehicle at any time. FFP 
may be available in the costs of this assessment under several categories:  
1) Administrative Expense: FFP may be claimed at the administrative rate for 
assessments to determine whether the person's home or vehicle may require 
modifications to ensure the health and welfare of the HCBS waiver participant. When 
the assessment is performed to determine whether the individual's needs can be met 
under an HCBS waiver, the administrative costs of the assessment may qualify for FFP 
regardless of whether or not the person is eventually served under the waiver;   2) Included in Environmental Modifications: The cost of environmental assessment 
may be included in the cost of environmental modification under an HCBS waiver; 
or  
3) Included in a Relevant Service: The assessment may be performed by another 
service provider, such as a home health agency or an occupational therapist. FFP 
would be available at the service match rate when these providers perform 
assessments in addition to their other duties.  
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When a State elects to provide assessments for accessibility as a service expense under a HCBS 
waiver, the State must have a policy on file with HCFA that clearly delineates the circumstances 
under which these assessments are billed as either an administrative or a service expense. This 
information must be included in the supporting documentation that the State forwards in support of 
its HCBS waiver request.  
The cost of reassessment may also be found eligible for FFP. Reassessment may be performed to 
determine whether new or additional modifications are needed, or whether existing (or newly 
installed) arrangements continue to be sufficient to meet the individual's needs.  
C. Environmental Modifications: It may be necessary to make environmental modifications to an 
individual's home before an individiual transitions from an institution to the community. For 
example, a wheelchair ramp may need to be built and doors may need to be widened to permit the 
individual to access his/her home. In such cases, the home modification begun while the person 
was institutionalized is not considered complete until the date the individual leaves the institution 
and is enrolled in the waiver. A State may claim FFP for home modifications (including actual 
construction costs) furnished as a waiver service for up to 180 days prior to discharge when (a) 
these modifications have been initiated before the individual leaves the institution and enrolls in 
HCBS waiver, (b) home modifications are included in the approved HCBS waiver. The claim for 
FFP must indicate the date the individual leaves the institution and enrolls in the waiver as the date 
of service for allowable expenses incurred during the previous 180 days.  
D. Policy change: Modifications Interrupted by Recipient's Death: The HCBS waivers serve a 
vulnerable population. Individuals who have chosen to relocate from an institutional to a 
community residence sometimes die before the relocation can occur. We believe that it would have 
a chilling effect if States were denied FFP for environmental assessments or modifications for 
individuals who died before their transition to home or community-based services. Therefore, we 
will allow the State to claim FFP at the administrative rate for services which would have been 
necessary for relocation to have taken place when the person has:  
1) applied for waiver services,  
2) been found eligible for the waiver by the State (but for the person's status as an   inpatient in an institution), but 
 
3) died before the actual delivery of the waiver services.  
Any questions concerning this attachment may be referred to Mary Jean Duckett at (410) 786-
3294 or Mary Clarkson at (410) 786-5918.  
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Attachment 3-c Subject: Personal Assistance 
Retainer -- Policy Change Date: July 25, 2000  
Medicaid regulations at 42 CFR 447.40 permit States to make payment to "hold" an institutional 
bed open for a resident while that individual is hospitalized or away from the facility for a short 
period. States which make this payment must indicate their intentions (and applicable time limits) 
in their State plans. We are writing this guideline to inform you that you may choose to implement 
a similar policy to allow payment for personal assistance services (such as personal care or 
attendant services) under HCBS waivers. This would enable beneficiaries to have parity between 
nursing home care and HCBS care in terms of assuring continuity of care and services.  
Individuals with disabilities utilize personal assistance services provided under a HCBS waiver to 
support various activities of daily living. These services are furnished by individuals employed by 
community-based agencies, or by persons who are self-employed or employed directly by the 
waiver participant. Typically low payment rates make it unlikely that a provider could afford to 
give up a day's or week's salary because the waiver consumer is hospitalized or otherwise absent. 
Rather than wait for the waiver consumer to return, providers are more likely to find permanent 
employment elsewhere. Those who are employed by agencies are often reassigned to other agency 
clients - and may not return. Lack of providers can be catastrophic for an individual with 
disabilities.  
Personal assistance retainer payments, as described in this attachment, are limited to services 
furnished under HCBS waivers. To enable waiver participants to continue to receive services in 
the most integrated setting appropriate to their needs, we will permit continued payment to 
personal caregivers under the waiver while a person is hospitalized or absent from his or her 
home. If a State chooses to make such payments, it must clearly indicate this in its HCBS waiver 
request.  
States that choose to make payments to be made for personal assistance retainers must also specify 
the limits that will be applied to this service. The personal assistance retainer time limit may not 
exceed the lesser of 30 consecutive days or the number of days for which the State authorizes a 
payment for "bedhold" in nursing facilities.   Any questions concerning this attachment may be referred to Mary Jean Duckett at (410) 786-
3294 or Mary Clarkson at (410) 786-5918.  
 
 
Attachment 3-d  
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Subject: Habilitation in HCBS Waivers -- 
Clarification Date: July 25, 2000  
Section 1915(c)(4)(B) of the Social Security Act (the Act) permits States to offer habilitation 
services under a Medicaid home and community-based services (HCBS) waiver. Habilitation 
services are defined in 1915(c)(5) of the Act as "services designed to assist individuals in acquiring, 
retaining, and improving the self-help, socialization, and adaptive skills necessary to reside 
successfully in home and community-based settings." The definition includes expanded services 
such as prevocational, educational, and supported employment services, if not otherwise excluded 
by law or the terms of a State's approved waiver.  
Clarification: States have historically provided habilitation services under an HCBS waiver to 
individuals with mental retardation or related conditions which occurred before age 22. However, 
neither the law nor implementing regulations restrict who may receive habilitation services in an 
HCBS waiver. Other individuals who do not have mental retardation or related conditions, such as 
persons with traumatic brain injury or other physical disabilities that occurred after age 22, may 
also benefit from habilitation services under the waiver. Accordingly, States may provide 
habilitation services - including the expanded habilitation services of educational, prevocational 
and supported employment services -under an HCBS waiver to people of all ages who qualify for 
the waiver.  
To receive services under a HCBS waiver, an individual must meet all targeting criteria set forth in 
the approved waiver. These criteria must include the institutional level or levels of care to which 
the waiver services provide an alternative.  
We believe that this clarification will expand a State's choices of services which can be 
provided to persons with disabilities in home and community-based waiver programs. It may 
also assist States in fulfilling their responsibilities under the Americans with Disabilities Act.  
States continue to have the flexibility to target waivers to specific populations and age groups 
within statutory allowances and to determine what services are provided under the waiver. Any 
questions concerning this attachment or the home and community-based waiver program may be 
referred to Mary Jean Duckett at (410) 786-3294 or Mary Clarkson at (410) 786- 5918.   Attachment 3-e Subject: Out-of State 
Services -- Clarification Date: July 25, 
2000  
Out-of-State services have been provided by several States for many years, with excellent results 
in quality of service and quality of life for the waiver participants. Regulations at 42 CFR 431.52 
prescribe the conditions under which a State is required to provide out-of-State services. Section 
1902(a)(23) of the Social Security Act (the Act) provides that an individual may receive Medicaid 
services (including  
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home and community-based services (HCBS) waiver services) from any qualified provider 
willing to furnish the services.  
Historically, out-of-State services have been used to support some individuals attending college, 
and enabled others to visit family members. In addition, there are some areas near State borders 
where the closest (or most convenient) provider is located in an adjacent State. When convenience 
or necessity make it advisable for services to be provided outside the State, there is no restriction to 
in-State services.  
When residential out-of-State services are recommended by a State because services within the 
State are unavailable or insufficient to meet the person's needs, careful consideration must be given 
to the reason for providing the services, as well as alternatives which may contribute more to an 
individual's ability to receive quality supports in a community based setting. Services provided in a 
location remote from the individual's family and friends may not provide appropriate support for 
the person to live in the most integrated setting appropriate to his or her needs.  
When services are provided out-of-State, the standard waiver requirements must continue to be 
met. Examples include the following:  
Written plan of care: The services must be in the person's written plan of care (section 
1915(c)(1) of the Act). The plan of care must identify the services to be provided, the 
amount and type of each service, and the type of provider. The requirement that the 
type of provider be included in the care plan does not mean that the name of the 
actual provider must be listed in the plan of care. The plan of care is subject to the 
approval of the Medicaid agency. The actual provider is subject to the approval of the 
individual receiving services.  
Waiver-Qualified Provider: Services must be furnished by a qualified provider 
(section 1902(a)(23) of the Act). The provider must meet the standards for service 
provision that are set forth by the State in the waiver and approved by HCFA. Any 
standards of licensure or certification which are applicable to the provision of the 
service must also be met (42 CFR 441.302(a)(2)). This means that any standards 
applicable to the provision of the service in the State in which the service is furnished 
must be met, as well as those standards set forth in the approved waiver. If one State  were to pay for a service furnished in another, the provider must be qualified under 
the standards in the waiver, and the service must also meet any applicable 
requirements in the State in which it is provided.  
Quality Assurance: The State operating the waiver remains responsible for the 
assurance of the health and welfare of the beneficiary (section 1915(c)(2)(A) of the 
Act). Oversight may be performed directly by the home State or by the host State in 
which services are actually received. If it is done by the host State, there must be an 
interstate compact or agreement setting forth the responsibilities of each party. 
Under an interstate compact, the State in which services are provided can agree to 
take over monitoring responsibilities.  
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Some States have compacts which recognize each other's provider agreements. Others 
recognize each other's provider standards. States have the opportunity to be quite 
creative in their utilization of these compacts to foster efficient and responsive HCBS 
programs. We recognize this as an opportunity to expand Medicaid services to meet 
the needs of individuals in the most integrated settings appropriate.  
Choice of Provider: The provider must be chosen by the individual (section 1902(a)(23) 
of the Act). The provider of out-of-State services must be chosen just as freely as the 
provider of in-State services. We realize that in some cases, out-of-State services are 
much closer and more easily obtained than in-State services. This is particularly true 
when a neighboring State has a large city on or near a State border.  
Provider Agreements: The provider must have a provider agreement with the Medicaid 
agency (section 1902(a)(27) of the Act); and Medicaid payment must be made directly 
to the provider (section 1902(a)(32) of the Act).  
Any or all of the above requirements may be met directly by the State which operates the waiver, 
or indirectly through an interstate compact in which the second State attends to provider 
agreement and payment activities.  
Any questions concerning this attachment may be referred to Mary Jean Duckett at (410) 786-3294 
or Mary Clarkson at (410) 786-5918.  
 
Attachment 3-f Subject: Services Provided Under a Nurse's 
Authorization -- Clarification Date: July 25, 2000  
This attachment provides policy guidance regarding Medicaid coverage of services provided  pursuant to a nurse's authorization by other providers and the availability of Federal Financial 
Participation (FFP) for those services. States have referred to these services as "nurse-delegated 
services" or "services provided under a nurse's delegation of authority." This guidance clarifies that 
States may enable individuals to receive services in the most integrated setting by permitting 
providers, such as personal care and attendant care providers, to furnish these services.  
State Medicaid programs may cover any services authorized by a nurse that fit within a category of 
services covered under the Medicaid State plan, a home and community-based services (HCBS) 
waiver, a managed care waiver, or an approved demonstration project. FFP for the services must be 
claimed under the category appropriate for the service that was furnished. Under this interpretation, 
health- 
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related services provided at the authorization of a nurse, which would otherwise be classified as 
nursing services, are billed in the category of the actual provider. For example, the health-related 
component of personal care services authorized by a nurse, which are provided by a personal care 
provider, would be billed and reimbursed as personal care services (Medicaid State plan, HCBS 
waiver, or other waiver).  
As with all Medicaid services, the service for which FFP is claimed must meet the definition 
provided in the approved Medicaid State plan or HCBS waiver, and the actual provider must meet 
applicable provider qualifications and requirements. For example, if a State includes personal care 
services under its Medicaid State plan, FFP would be available for activities authorized by a nurse 
but furnished by a personal care provider who meets the provider qualifications and standards 
established by the State. States may wish to impose a requirement for authorization for any covered 
service when such a requirement would further the objective of ensuring appropriate high quality 
services. Of course, services provided under the authorization of a nurse must also be consistent 
with State law and regulations.  
States may choose to design their payment methodologies to take into consideration the complexity 
of authorized tasks, and may impose reasonable provider qualifications applicable to particular 
tasks. For example, States may choose to have two levels of provider qualifications and payment 
methodologies for personal care providers under its State plan: a basic level applicable to all 
personal care providers, and a higher level with additional qualifications for personal care providers 
who provide more complex tasks, such as those authorized by nurses. Qualifications may include 
additional training and/or demonstrated competency related to tasks authorized by a nurse that 
would not be required for providers who do not furnish such tasks. As States also establish the 
qualifications and payment methodologies for waiver providers, these requirements and rates for 
waiver personal care services or attendant care services may also reflect the same multi-level 
approach.  
Any questions concerning this attachment or Medicaid coverage of services authorized by a nurse 
may be directed to Mary Jean Duckett at (410) 786-3294 or Mary Clarkson at (410) 786-5918.    
Attachment 3-g Subject: Prohibition of Homebound Requirement in Medicaid Home 
Health -- Clarification Date: July 25, 2000  
The Medicaid home health benefit is an important tool for serving persons with disabilities in 
integrated settings. Medicaid regulations at 42 CFR 440.70(a)(1) require that home health services 
be provided to an individual at his or her place of residence. An individual's place of residence for 
purposes of home health services does not include a hospital, nursing facility, or intermediate care 
facility for the mentally retarded. Home health services must include part-time or intermittent 
nursing services, home health aide services, and medical supplies, equipment, and appliances 
suitable for use in the home. Physical or  
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occupational therapy and speech pathology and audiology services are optional.  
While current regulations specify that these services must be provided to an individual at his place 
of residence, it is not necessary that the person be confined to the home for the services to be 
covered under the Medicaid home health benefit. The "homebound" requirement is a Medicare 
requirement that does not apply to the Medicaid program. Imposing a homebound requirement on 
receipt of Medicaid home health benefits as explained below violates Medicaid regulations related 
to "amount, duration, and scope of services" at 42 CFR 440.230 and "comparability of services" at 
42 CFR 440.240. However, States may still limit the home health benefit in the manner allowed by 
statute and regulation.  
Section 42 CFR 440.230(c) indicates that "the Medicaid agency may not arbitrarily deny or 
reduce the amount, duration, or scope of a required service under sections 440.210 and 440.220 
to an otherwise eligible recipient solely because of the diagnosis, type of illness, or condition." 
Sections 440.210 and  
440.220 relate to required services for the categorically needy and to required services for the 
medically needy, including home health services. If a State limits home health services to persons 
who are homebound, while not providing medically necessary home health services to persons 
who are not homebound, it is arbitrarily denying the home health service based on the individual's 
condition (i.e., whether or not the individual is homebound) in violation of regulations at 
440.230(c).  
Section 42 CFR 440.240(b) indicates that "the plan must provide that the services available to 
any individual in the following groups are equal in amount, duration, and scope for all recipients 
within the group: (1) The categorically needy. (2) A covered medically needy group." Thus, if a 
State limits the provision of Medicaid home health services to individuals who are homebound, 
the State violates Federal requirements at 440.240(b) by providing the services to some 
individuals within the eligibility group and not to others within the group. However, States may 
still limit the home health benefit in the manner allowed by statute and regulation.  
The restriction of home health services to persons who are homebound to the exclusion of other  persons in need of these services ignores the consensus among health care professionals that 
community access is not only possible but desirable for individuals with disabilities. New 
developments in technology and service delivery have now made it possible for individuals with 
even the most severe disabilities to participate in a wide variety of activities in the community 
with appropriate supports. Further, ensuring that Medicaid is available to provide medically 
necessary home health services to persons in need of those services who are not homebound is an 
important part of our efforts to offer persons with disabilities services in the most integrated 
setting appropriate to their needs, in accordance with the Americans with Disabilities Act.  
For purposes of receipt of Medicaid home health services, a person's place of residence continues 
to be defined by the requirements of 42 CFR 440.70(c).  
Any questions concerning this attachment or the home health benefit may be referred to Mary Jean 
Duckett at (410) 786-3294 or Mary Clarkson at (410) 786-5918. <% 'Sitewide navigation info / do 
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