ming Institutionalized Lives (Abridged Version)

Reclaiming Institutionalized Lives (Abridged Version) National Council on Disability September 29, 2003 
National Council on Disability


1331 F Street, NW, Suite 850


Washington, DC 20004


Olmstead: Reclaiming Institutionalized Lives (Abridged Version)

This report is also available in alternative formats and on NCD’s award-winning Web site at


www.ncd.gov.


Publication date: September 29, 2003


202-272-2004 Voice


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202-272-2022 Fax


The views contained in this report do not necessarily represent those of the Administration as this


and all NCD reports are not subject to the A-19 Executive Branch review process.

NATIONAL COUNCIL ON DISABILITY


An independent federal agency working with the President and Congress to increase the 

inclusion, independence, and empowerment of all Americans with disabilities. 

Letter of Transmittal 

September 29, 2003


The President


The White House


Washington, DC 20500


Dear Mr. President:


The National Council on Disability is pleased to submit to you this report titled, “Olmstead: 

Reclaiming Institutionalized Lives.” Under its Congressional mandate, the National Council on 

Disability is charged with the responsibility to gather information on the implementation, 

effectiveness, and impact of federal laws, policies, programs, and initiatives that affect 54 million 

Americans with disabilities. This report measures progress to date in the implementation of the 

landmark U.S. Supreme Court decision in Olmstead v. L.C. and related Federal and State 

Government initiatives. 

In February 2001, you announced the New Freedom Initiative (NFI), a comprehensive plan that 

represents an important step in working to ensure that all Americans have the opportunity to learn 

and develop skills, engage in productive work, make choices about their daily lives, and 

participate fully in community life. In your NFI, you committed your Administration to pursuing 

the swift implementation of the Olmstead decision and supporting the most integrated 

community-based settings for individuals with disabilities. 

Overall, varying degrees of progress have occurred in the implementation of the Olmstead 

decision. However, given the many areas where progress has not yet been achieved and in 

recognition of the relatively brief time since the decision was rendered and governmental 

initiatives were undertaken, further efforts clearly are necessary to increase public awareness of 

Olmstead, provide education and clarification regarding the applications and implications of the 

decision to relevant entities, and provide resources necessary both to encourage and to ensure 

effective adherence to both the spirit and intent of Olmstead. 

In support of the NFI and to progress in the implementation of the Olmstead decision, I pledge 

our support to your Administration’s commitment to ensuring that equality of opportunity, full 

participation, independent living, and economic self-sufficiency become realities in the lives of 

Americans with disabilities. Under your leadership, I remain confident that we can continue to 

build an America where all citizens live independent lives in the community of their choice. 

Sincerely, 

Lex Frieden 

Chairperson 

(The same letter of transmittal was sent to the President Pro Tempore of the U.S. Senate and the 

Speaker of the U.S. House of Representatives.) 

1331 F Street, NW ■ Suite 850 ■ Washington, DC 20004


202-272-2004 Voice ■ 202-272-2074 TTY ■ 202-272-2022 Fax ■ www.ncd.gov

ii

Free our people, free our people, 

free our people. 

—Supporters of MiCASSA 

iii

iv

National Council on Disability Members and Staff 

Members 

Lex Frieden, Chairperson


Patricia Pound, First Vice Chairperson


Glenn Anderson, Ph.D., Second Vice Chairperson


Milton Aponte


Robert R. Davila, Ph.D.


Barbara Gillcrist


Graham Hill


Joel I. Kahn


Young Woo Kang, Ph.D.


Kathleen Martinez


Carol Hughes Novak


Anne M. Rader


Marco Rodriguez


David Wenzel


Linda Wetters


Staff 

Ethel D. Briggs, Executive Director


Jeffrey T. Rosen, General Counsel and Director of Policy


Mark S. Quigley, Director of Communications


Allan W. Holland, Chief Financial Officer


Julie Carroll, Attorney Advisor


Joan M. Durocher, Attorney Advisor


Martin Gould, Ed.D., Senior Research Specialist


Geraldine Drake Hawkins, Ph.D., Program Specialist


Pamela O’Leary, Interpreter


Brenda Bratton, Executive Assistant


Stacey S. Brown, Staff Assistant


Carla Nelson, Office Automation Clerk


v 
vi

Acknowledgments 

This report is issued in recognition of the victims of unnecessary institutionalization; our nation 

must not rest until it has delivered on the promise of freedom for all. The National Council on 

Disability expresses its appreciation to Judith Gran, Esq., with the Public Interest Law Center 

of Philadelphia, for drafting this report with the assistance of Max Lapertosa, Esq., and Ruthie 

Beckwith. 

vii 
viii

Contents 

Executive Summary ....................................................................................................................... 1


I. Barriers to Community Integration in the United States .................................................... 9


II. The Olmstead Decision .................................................................................................... 61


III.	 Case Law Applying and Interpreting Olmstead and Other Post-Olmstead Case Law


Concerning Rights to Community Services ..................................................................... 79


IV. The States’ Response to Olmstead v. L.C. ..................................................................... 125


Alabama ......................................................................................................................... 125


Alaska ............................................................................................................................ 125


Arizona ........................................................................................................................... 125


Arkansas ........................................................................................................................ 126


California ...................................................................................................................... 127


Colorado ......................................................................................................................... 127


Connecticut .................................................................................................................... 127


Delaware ........................................................................................................................ 128


District of Columbia ...................................................................................................... 128


Florida ............................................................................................................................ 128


Georgia ........................................................................................................................... 129


Hawaii ............................................................................................................................ 129


Idaho ............................................................................................................................. 129


Illinois ........................................................................................................................... 129


Indiana ........................................................................................................................... 131


Iowa ............................................................................................................................. 131


Kansas ........................................................................................................................... 131


Kentucky ........................................................................................................................ 132


Louisiana ........................................................................................................................ 132


Maine ............................................................................................................................. 132


Maryland ........................................................................................................................ 132


Massachusetts ................................................................................................................ 133


Michigan ........................................................................................................................ 133


Minnesota ...................................................................................................................... 134


Mississippi ..................................................................................................................... 134


Missouri ......................................................................................................................... 137


Montana ........................................................................................................................ 137


Nebraska ....................................................................................................................... 138


Nevada .......................................................................................................................... 138


New Hampshire ............................................................................................................ 138


New Jersey ..................................................................................................................... 139


New Mexico ................................................................................................................... 140


New York ...................................................................................................................... 140


North Carolina .............................................................................................................. 141


ix

North Dakota .................................................................................................................. 141


Ohio ............................................................................................................................. 142


Oklahoma ....................................................................................................................... 142


Oregon ............................................................................................................................ 142


Pennsylvania .................................................................................................................. 143


Rhode Island ................................................................................................................. 143


South Carolina ............................................................................................................... 143


South Dakota ................................................................................................................. 144


Tennessee ...................................................................................................................... 144


Texas ............................................................................................................................. 145


Utah ............................................................................................................................. 146


Vermont ......................................................................................................................... 146


Virginia ......................................................................................................................... 146


Washington ................................................................................................................... 147


West Virginia ................................................................................................................ 150


Wisconsin ....................................................................................................................... 151


Wyoming ....................................................................................................................... 152


V. Lessons Learned: Good Practice in Community Services and What Works ................. 153


VI. Conclusions and Recommendations ............................................................................. 165


Appendix .................................................................................................................................... 191


x 
Executive Summary 

The extent of unnecessary institutionalization of people with disabilities in the United States is 

daunting. Research and experience have shown that the great majority of people who live in large 

congregate settings could be supported safely and effectively and enjoy a higher quality of life in 

a typical home in the community. Longitudinal studies of community placement document their 

more favorable outcomes and furthermore establish that persons with significant disabilities 

benefit the most from community placement. Similarly, comparing residents of nursing facilities 

with elders, children with complex health needs, and adults with physical disabilities living at 

home shows that nursing facility residents are not more severely disabled than those who receive 

support in their own homes. Yet, 106,000 persons with developmental disabilities lived in public 

and private institutions and more than 1,300,000 elders and persons with disabilities lived in 

nursing facilities in the year 2000. In addition, data on the outcomes of consumer-directed mental 

health services and intensive case management models show that most of the 58,000 persons 

currently confined in psychiatric institutions could be supported in their own homes in the 

community. The persons who fill the more than 800,000 licensed board and care beds in the 

United States could also live in the community. 

In this report, the National Council on Disability (NCD) assesses the nation’s response to the 

United States Supreme Court’s decision in Olmstead v. L.C., 527 U.S. 581 (1999) that the 

unjustified institutionalization of people with disabilities is a form of discrimination. NCD’s 

research reports on the extent of unnecessary institutionalization in the United States, the 

continuing barriers to community placement, and resources and service models that facilitate 

community integration. NCD examines the Federal Government’s implementation efforts and the 

strategies states and key stakeholders are using to (1) develop consensus on a coordinated action 

plan, (2) identify and commit the necessary resources for community-based service options, and 

(3) sustain collaborative action toward creating real choice for people with disabilities living in 

1

institutions. NCD collected extensive information, available online in the electronic version of 

this report at www.ncd.gov/newsroom/publications/reclaimlives.html, on the states’ experiences 

in the planning and implementation of the Olmstead decision. 

The Olmstead Decision 

In 1999, by a clear majority, the United States Supreme Court held in Olmstead v. L.C., 527 U.S. 

581 that, under the Americans with Disabilities Act (ADA), undue institutionalization qualifies 

as discrimination by reason of disability and that a person with a mental disability is “qualified” 

for community living when the state’s treatment professionals have determined that community 

placement is appropriate, the transfer from institutional care to a less restrictive setting is not 

opposed by the individual, and the placement can be reasonably accommodated, taking into 

account the resources available to the state and the needs of others with mental disabilities. 

Whereas the justices agreed that the state is not required to provide immediate relief in the form 

of community placement where such relief would represent a “fundamental alteration” of the 

state’s programs, the majority did not agree on what constitutes a “fundamental alteration.” Only 

four justices agreed on the interpretation of the fundamental alteration defense set forth in Justice 

Ginsburg’s opinion: that the defense should be construed to “allow the State to show that, in the 

allocation of available resources, immediate relief for the plaintiffs would be inequitable, given 

the responsibility the State has undertaken for the care and treatment of a large and diverse 

population of persons with mental disabilities” (527 U.S. at 604, emphasis added). Justice 

Ginsburg added that demonstrating that it has “a comprehensive, effectively working plan for 

placing qualified persons with mental disabilities in less restrictive settings” is one method a 

state may use to show that it already has reasonably modified its programs and that no further 

alteration is necessary. This statement became the basis for the Olmstead planning initiatives. 

2

Barriers to Community Integration in the United States 

Representatives of all disability groups agreed that lack of affordable and accessible housing is 

the single biggest barrier to community integration in the United States. Persons with disabilities 

whose incomes depend on government benefits need housing subsidies or shared housing to live 

in the community. Unfortunately, because of systemic barriers, people with disabilities tend not 

to receive their fair share of the approximately $7 billion in federal housing subsidy programs, 

and the various Section 8 housing subsidy programs targeted to persons with disabilities are 

funded at a relatively modest amount ($271 million in 2001) in comparison. An additional barrier 

is the lack of meaningful collaboration between human services agencies and housing agencies. 

High unemployment rates for persons with significant disabilities (typically 60 to 90 percent) 

maintain dependence on public benefits. 

Low wages and benefits severely limit the availability of personal assistants and other direct 

support professionals. In turn, low wages are the result of low reimbursement rates for 

community services. Lack of quality health care and dependable transportation are also 

significant barriers. 

The institutional bias of the Title XIX (Medicaid) program, in which home- and communitybased waiver–funded services and personal care are optional whereas nursing facility services are 

required and financial eligibility rules for institutional residents are more generous than those for 

people living in their own homes, greatly compounds the problem. Title XIX waivers have 

significantly expanded available funding for home- and community-based services but have not 

leveled the playing field; because state governments do not recognize home- and communitybased waiver services as entitlements, waiting lists for waiver services are long in most states. 

The unavailability of Title XIX reimbursement for services to adults below the age of 65 in 

Institutions for Mental Diseases (IMDs) poses a significant barrier to the use of home- and 

community-based waivers to fund community mental health services. 

3

Delivering on the Promise 

On June 18, 2001, President George W. Bush, pursuant to his New Freedom Initiative, issued 

Executive Order No. 13217, committing the Administration to implement the integration 

mandate of the ADA as interpreted in Olmstead. The Executive Order required federal agencies 

to promote community living for persons with disabilities by providing coordinated technical 

assistance to states; identifying specific barriers in federal law, regulation, policy, and practice 

that impede community participation; and enforcing the rights of persons with disabilities. 

Pursuant to the Executive Order, federal agencies evaluated their own programs to identify 

barriers and issued their final reports on March 25, 2002. 

Altogether, the reports acknowledged the many barriers to community integration of persons with 

disabilities, including the institutional bias of the Medicaid program, unaffordable and 

inaccessible housing, a critical shortage of personal assistance and direct support professionals, 

and the unavailability of supported employment. However, most of the proposed agency actions 

consisted of technical assistance, training, research, demonstration, policy review, public 

awareness campaigns, outreach, enforcement of existing regulations, information dissemination, 

convening of advisory committees, and interagency coordination and collaboration. Systemic 

solutions, measurable goals, timelines, deliverables, and outcomes were lacking. 

In early 2003, President Bush’s Administration announced a five-year program beginning in FY 

2004, the “Money Follows the Individual” Rebalancing Demonstration, to enable people with 

disabilities to move from institutions to the community. The program would provide 100 percent 

federal funding for home- and community-based waiver services for one year for a person 

leaving an institution, after which the state would agree to continue to provide services for the 

person at the regular Medicaid matching rate. 

4

The States’ Response 

After Olmstead was decided, the Department of Health and Human Services (HHS) provided 

guidance to the states concerning the development of “comprehensive, effectively working 

plans” in increasing community placements. In addition, Olmstead stakeholders concluded that 

state implementation plans could have value both as an organizing tool for achieving 

deinstitutionalization and as a method to persuade states to commit to numerical targets, 

timelines, and allocation of resources. Although the experiences of states and stakeholders in 

implementing Olmstead varied widely, NCD’s evaluative study documents some key overarching 

findings, including the following: 

� Plans do not consistently provide for opportunities for life in the most integrated 

setting as people with disabilities define “the most integrated setting.” 

� The majority of states have not planned to identify or provide community 

placement to all institutionalized persons who do not oppose community 

placement. 

� Few plans identify systemic barriers to community placement or state action steps 

to remove them and few plans contain timelines and targets for community 

placement. 

� State budgets often do not reflect Olmstead planning goals. 

Lessons Learned: Good Practice in Community Services and What Works 

The following are some of the many examples suggested by this report of promising practices in 

the design, delivery, and financing of community services. 

� Good practice in Olmstead planning. Indiana’s recent plan assigns each 

recommendation to one of three categories: those that should be implemented 

quickly and with little or no fiscal impact or regulatory requirements; those that 

should be implemented quickly but have a fiscal impact or require regulatory 

5

changes; and those that are more complex, costly, or difficult and will require 

more time to develop and implement. Indiana’s plan should serve as a model for 

other states. Nevada’s Olmstead plan is commendable for its candid analysis of 

the state’s compliance with Olmstead. 

� Overcoming incentives to unnecessary institutionalization. Methods include 

Maine’s use of pre-admission screening by an independent agency prior to nursing 

facility placement, Minnesota’s legislation encouraging nursing facility operators 

to take beds out of service, and Washington’s system for tracking reduction 

targets for nursing facility placements. 

� Identification and transition of people with disabilities from institutions. In 

Colorado and Kansas, disability rights advocates are doing the work of identifying 

people in nursing facilities who could move to more integrated settings. 

� Use of trusts and fine funds to finance transition costs and start-up of 

community services. A creative and underappreciated set of strategies for 

financing transition costs, providing “bridge funding,” and funding new 

community services involves the creation of trusts and fine funds dedicated to the 

needs of people with disabilities. North Carolina, Oregon, and Washington have 

used the proceeds from the sale of state facilities to establish trusts to generate 

funds for people with disabilities. 

� Housing strategies. Commendably, and in large part because of the influence of 

the technical assistance provided by the Department of Health and Human 

Services’ (HHS’) Office of Civil Rights (OCR), the more recently developed 

plans tend to reflect the input of housing agencies. Provisions for requiring 

universal design in new units that state housing agencies fund or finance; ensuring 

that all existing publicly financed housing has completed Section 504/ADA selfevaluations; conducting utilization reviews to ensure that targeted Section 8 

programs are fully used; and including home modifications and home repair in the 

services provided under home- and community-based waivers and independent 

6

living programs are examples of housing-related recommendations in state 

Olmstead plans. 

� Single point-of-entry systems. Single point-of-entry systems have the potential 

to reduce unnecessary institutionalization by providing easier access to a wider 

array of community services. Single point-of-entry systems that separate 

“assessment” and “service brokerage” from “service provision” are also 

responsive to the Centers for Medicare and Medicaid Services (CMS) findings in 

a number of states that Medicaid beneficiaries’ right to choose among qualified 

providers was violated. 

� Beyond institutional closure: Increasing community integration. 

Developmental disabilities services in Vermont and New Hampshire show that, 

more than placement in a residence outside an institution, “the most integrated 

setting” is a continuous process of increasing community inclusion. These states’ 

service systems have progressed far beyond institutional closure and are 

eliminating group homes in favor of living in a companion home or a home of 

one’s own and working at a real job with support. 

� Self-determination. Self-determination and consumer-directed service models 

have been so broadly tested and practiced that they have emerged as fundamental 

principles in human services. 

Recommendations 

On the basis of its research, NCD recommendations for the Federal Government include the 

following: 

� HHS and CMS should provide more explicit guidance on implementation of 

Olmstead v. L.C. 

7

� CMS should determine whether the states are adequately identifying residents of 

Medicaid-funded and -certified facilities that can handle and benefit from 

community living. 

� HHS should refocus its Real Choice Systems Change grant program as a true 

system-change project by shifting from funding demonstration projects to funding 

change that affects entire service systems. 

� HHS should require the states to identify all institutionalized persons in the state 

and their need for community services. 

� CMS should use its waiver approval authority to require the states to minimize 

“institutional bias” in the choice between institutional and home- and communitybased waiver services. 

� HHS should provide federal financial assistance to states to provide small grants 

to people with disabilities for transition costs from institutions to community. 

Conclusion 

The Olmstead decision has become a powerful impetus for a national effort to increase 

community-based alternatives and eliminate unjustified institutional placements. Ultimately, only 

comprehensive amendments to Title XIX of the Social Security Act, similar to the amendments 

proposed in MiCASSA (the Medicaid Community-based Attendant Services and Supports Act), 

will overcome the institutional bias within the Medicaid program. In the meantime, however, 

federal agencies have many measures, short of a thorough revision of Title XIX, they can and 

should undertake. We must continue to empower Olmstead stakeholders in their state “systems 

change activities,” that is, in their efforts to redesign the state service systems to enhance choice, 

independence, self-determination, and community integration. Our nation will be much more 

prosperous when it makes real the right of people with disabilities to live in the most integrated 

setting. 

8

I. 

Barriers to Community Integration in the United States 

1. What Is “The Most Integrated Setting”? Views of Persons with Disabilities 

[P]eople with disabilities have the same rights as other citizens to freedom, 

equality, equal protection under the law, and control over their own lives. These 

rights must be honored if people who have disabilities are to be fully included as 

valued citizens in the relationships and opportunities of community life.1 

In our interviews with informants with disabilities and their advocates, we asked what the person 

considered “the most integrated setting” for persons with disabilities. Almost without exception, 

the interviewees responded by naming the qualities that make home living meaningful and 

satisfying to the individual. Only two respondents named a type of program, such as a supported 

living arrangement or a two-person home. Response patterns were similar across all categories of 

disability. 

The most common response was that the most integrated setting is “a place where the person 

exercises choice and control,” including choice of service providers: “What people themselves 

want! ... Self-determination is essential. People decide for themselves what they want and need.”2 

A variation on this response was, “Whatever the person considers most integrated.” The second 

most common response was, “A home of one’s own shared with persons whom one has chosen 

to live with,” or where one lives alone. The third most common response emphasized that home 

living for persons with disabilities should be like home living for other community members. 

Integration is “living in the community with everyone else like everyone else.”3 Several 

1

The Seattle 2000 Declaration on Self-Determination and Individualized Funding. 


2

Interview with Judi Chamberlin, August 3, 2001.


3

Interview with Melvin Guzman, August 7, 2001.


9 
respondents defined community integration as the result of participation in community activities 

or of the assumption by persons with disabilities of leadership roles in the community. And 

finally, one respondent defined community integration as affording opportunities for privacy, 

unlike an institution. 

Similarly, when interviewees were asked what people with disabilities need to live in the most 

integrated setting, they responded, almost universally, not by listing formal services but by 

identifying ordinary human needs. Again, response patterns were similar across all disability 

groups. The most common response was that support depends on the person, must be defined by 

and tailored to the individual, and may change over time. The second most common response 

was that people need friendships, emotional support, and networks of friends, family, and 

mentors. Education, participation in community activities, and transportation were mentioned by 

a number of respondents. The only services that were listed were personal assistance, 

communication (for a person with autism), and case management (by one person); however, this 

latter response was offset by two respondents who stated emphatically that caseworkers and case 

managers were not helpful to persons with disabilities. 

Every person we interviewed who was affiliated with a disability organization stated that the 

organization had a position on the right to live in the community. Organizational positions on 

community living varied little from one disability group to another. Some stated that the right to 

live in the community is “absolute,” and others that closure of institutions is their organization’s 

highest priority. The following were other common positions: 

� Everyone has the right to live in the community with support.


� People should live independently, not in a nursing home. 


� We support the right to choose.


� We support self-determination.


� We support inclusive communities. 


10

2. The Extent of Unnecessary Institutionalization in the United States 

Measured by our respondents’ views of the most integrated setting, the number of people with 

disabilities who currently are denied the opportunity to live in the most integrated setting is large 

indeed. That number includes many people who live in group homes and other small congregate 

settings as well as those who live in large congregate facilities. However, applying a more 

modest definition of “the most integrated setting” as a living arrangement other than an 

institution, the number of unnecessarily institutionalized persons in the United States is daunting. 

(a) Residents of Developmental Disabilities Institutions 

In 2000, approximately 106,000 persons lived in state-operated and private Intermediate Care 

Facilities for persons with Mental Retardation (ICFs/MR) with seven or more beds. In addition, 

nearly 35,000 people with developmental disabilities lived in nursing facilities.4 For how many of 

these persons is a large ICF/MR or a nursing facility the most integrated setting? Although 

formal assessment data are lacking, it is possible to conclude from the studies of other 

institutional residents who have moved to the community that nearly all could receive the support 

they need in a small home in the community. During the past 20 years, a large body of research 

has documented the outcomes for people with developmental disabilities moving from 

4

David L. Braddock, unpublished data for 2000 from the State of the States in 

Developmental Disabilities Project, Coleman Institute for Cognitive Disabilities and the 

Department of Psychiatry, University of Colorado. See also C. Harrington et al., 1997 State Data 

Book on Long Term Care: Program and Market Characteristics (University of California at San 

Francisco, 1999) at 3. 

11

institutions to the community. These studies “strongly suggest that people with all levels of 

developmental disability would enjoy better lives in community-based settings.”5 

The first systematic analysis of the impact of deinstitutionalization, the Pennhurst Longitudinal 

Study, tracked more than 1,100 persons who moved from Pennhurst Center, a developmental 

disabilities institution in Pennsylvania, under the court’s orders and consent decree in Halderman 

v. Pennhurst beginning in 1979. Pennhurst closed in 1987, and virtually every resident moved to 

the community. Most moved to three-person homes in typical neighborhoods. The study found 

that as people moved from Pennhurst, they experienced significant gains in skills, personal 

happiness, family satisfaction, opportunities to participate in community activities, and other 

indicators of quality of life. In the community, the former Pennhurst residents were “better off in 

every way that we know how to measure.” Moreover, the gains continued even after people had 

lived in the community for some time.

6 

These findings have been replicated in many other states, in cases in which institutional closure 

occurred under court order and in voluntary deinstitutionalization efforts.7

 Further, the studies 

have shown that institutional residents with the most severe disabilities—those with profound 

retardation—experience the most dramatic gains in quality of life after they move to the 

5

J. Conroy, The Hissom Outcomes Study: A Report on Six Years of Movement into 

Supported Living (Brief Report Number 1 of a Series on the Well-Being of People With 

Developmental Disabilities in Oklahoma (Ardmore, PA: The Center for Outcome Analysis, 

December 1995) at 2. 

6

J. Conroy, The Pennhurst Longitudinal Study: A Report of Five Years of Research and 

Analysis (Ardmore, PA: The Center for Outcome Analysis, 1985). 

7

J. Conroy, The Hissom Outcomes Study at 3–4; S. Larson and C. Lakin, 

Deinstitutionalization of Persons with Mental Retardation: Behavioral Outcomes, 14 Journal of 

the Association for Persons with Severe Handicaps (1989) at 324–332. 

12

community.

8

 More recently, studies of former institutional residents who are supported in newer 

models of services, such as supported living and self-determination, have shown that those 

persons make even greater gains in skills and experience a dramatically improved quality of life.

9 

(b) Residents of Nursing Facilities 

Nationwide, 1,302,315 persons lived in nursing facilities in 1999, a slight decrease since 1993, 

when 1,305,212 persons lived in such facilities.10 Expressed as a percentage of U.S. residents 

ages 65 and older, this figure is the equivalent of 3.7 percent of the elder population.11 Because 

occupancy rates in nursing facilities are significantly less than 100 percent (the average 

occupancy rate was 86 percent in 1997), the number of nursing facility beds is considerably 

larger than the number of residents. The total number of nursing facility beds in the nation 

increased from 1.31 million in 1978 to 1.81 million in 1997, and the number of nursing facilities 

in the nation increased during that period from 14,264 to 17,628.12 

The Medical Assistance program supports about 1 million of the 1.3 million nursing facility 

residents. In 2000, approximately 10.9 percent of those persons were under age 65. The cost of 

8

J.W. Conroy and V.J. Bradley, The Pennhurst Longitudinal Study: A Report of Five 

Years of Research and Analysis (1985) at 332; J. Conroy et al., 1990 Results of the CARC v. 

Thorne Longitudinal Study (The Connecticut Applied Research Project, Report No. 10, 1991). 

9

J. Conroy, The Hissom Outcomes Study at 36, 40, 45–46, 55. 

10C. Harrington et al., Nursing Facilities, Staffing, Residents, and Facility Deficiencies, 

1993 through 1999 (University of California at San Francisco, 2000) at 26. 

11Id.; U.S. Census Bureau (April 2001). Of course, not all nursing facility residents are 65 

or older. W. Fox-Grage et al., Community-Based Long-Term Care (National Conference of State 

Legislatures: Promising Practices Issue Brief, 2000) at 1. 

12C. Harrington et al., 1997 State Data Book on Long Term Care: Program and Market 

Characteristics (University of California at San Francisco, 1999) at 2. 

13

nursing facility services accounted for more than 20 percent of all Medicaid expenditures during 

most of the 1990s and around 60 percent of all long-term expenditures.13 

Nursing facility placement varies significantly from one state to another. For example, in 

Arizona, the nursing facility population is the equivalent of 1.1 percent of the population age 65 

or older, whereas in Mississippi, the comparable percentage is 4.1 percent. In some states, such 

as Arizona, Maryland, and New Jersey, the nursing facility population has decreased significantly 

since 1993. In many others, for example, Illinois, Florida, and Indiana, the nursing facility 

population has increased. 

The Nursing Home Reform Act14 requires states to screen persons who are being considered for 

nursing facility placement to ensure that they need the level of nursing care available in such a 

facility. The purpose of the Act is to divert persons who do not need nursing home care into 

community-based services. However, the Act does not prevent unnecessary nursing home 

placement for persons who do need skilled nursing services but could receive those services in 

the community if services were available. 

The great majority of persons age 65 or older, including those with disabilities, do not live in 

nursing facilities. In fact, more than 90 percent of disabled older people living in the community 

get most of their everyday care from family caregivers.15 Nevertheless, Medicaid expenditures for 

elders are highly skewed toward nursing facility services. In 1995, Medicaid expenditures on 

long-term care for elderly beneficiaries represented 84.1 percent of the total and home care only 

13Department of Health and Human Services, Center for Medicare and Medicaid Services, 

Letter to State Medicaid Directors, August 13, 2002. 

1442 U.S.C. § 1396r(e)(7), enacted as part of the Omnibus Budget Reconciliation Act 

(OBRA) 1987. 

15Testimony of Janet Saynor, former Commissioner of Aging, City of New York, 

National Listening Session (September 5, 2001), PM testimony at 186–87. 

14

10.3 percent.16 Compared with nursing facility residents’ need for community services and the 

availability of home- and community-based waiver funding for persons with developmental 

disabilities, the number of elders, adults, and children with physical disabilities and complex 

health care needs who receive home- and community-based services under the waiver (and who 

otherwise might have to live in a nursing facility) is relatively modest. According to statistics 

released by the National Institute on Disability and Rehabilitation Research (NIDRR) in October 

2001, 43 home- and community-based waivers for elders with disabilities served a total of 

235,215 persons; 27 home- and community-based waivers for persons with physical disabilities 

served a total of 25,704 persons; 20 home- and community-based waivers for children served a 

total of 3,072 persons; and 12 home- and community-based waivers for persons with acquired 

brain injury served a total of 1,373 persons.17 

How many nursing facility residents could live in the community if services and support were 

available? Many elders with disabilities, children with complex health care needs, and adults with 

physical disabilities who live in their own homes and receive support from personal assistants, 

family, or friends have disabilities just as severe as those of nursing home residents. Data about the 

disabilities of more than 200,000 persons served by California’s In-Home Supportive Services 

(IHSS) program show that the persons who use consumer-directed funds to pay family members or 

friends to provide personal assistance tend to have significantly more severe disabilities than other 

persons served by the program.18 Community-based models of service for persons with complex 

16J.M. Wiener and D.G. Stevenson, Long-Term Care for the Elderly: Profiles of Thirteen 

States (Urban Institute, 1998) Table 3. 

17NIDRR, Medicaid Home and Community Based Services, Disability Statistics Report 

16 (October 2001). 

18L. Polivka and J. Salmon, The Ethical and Empirical Basis for Consumer-Directed 

Care for the Frail Elderly: A Guide to State Policy Makers (Florida Policy Exchange on Aging, 

2000). 

15

health needs, for example, persons with end-stage renal disease, have shown that these persons can 

receive skilled nursing services in their own homes or in a home-like setting.

19 

(c) Residents of Psychiatric Institutions 

The Substance Abuse and Mental Health Services Administration (SAMHSA) of HHS estimates 

that, in 2001, about 58,000 persons with serious mental illness remained institutionalized in state 

psychiatric hospitals “in large part” because of “persistent clinical, service system, and financial 

barriers.”20 Little dispute exists that “[m]any thousands more live in nursing homes and others are 

inappropriately institutionalized in jails.”21 A 1999 U.S. Department of Justice study reported that 

284,000 persons incarcerated in local, state, and federal prisons had a mental illness.22 

Downsizing and closure of state mental health institutions accelerated during the 1990s. 

Although from 1970 to 1990 the total number of state and country psychiatric beds declined by 

half, only 14 hospitals were closed. During the 1990s, however, 44 state psychiatric hospitals 

were closed, and three additional closures were planned.23 

19Comments by a registered nurse at the National Listening Session, PM testimony at 

172–73. 

20Bianco et al., Overcoming Barriers to Community Integration for Persons with Mental 

Illness (SAMHSA, 2001) at i. 

21Bazelon Center for Mental Health Law, Under Court Order: What the Community 

Integration Mandate Means for People with Mental Illnesses (1999). 

22Bianco et al., Overcoming Barriers to Community Integration for Persons with Mental 

Illness (SAMHSA, 2001) at 8. 

23National Association of State Mental Health Program Directors Research Institute, 

“Closing and Reorganizing State Psychiatric Hospitals: 2000” (August 10, 2000). 

16

Data on use of mental health services by race and ethnicity reveal that African-Americans are 

significantly more likely than whites to be institutionalized in psychiatric hospitals and to be 

subject to repeat admissions after discharge. At the same time, African-Americans are significantly 

underrepresented in outpatient treatment programs, and studies show that they are less likely than 

whites to receive appropriate treatment and newer medications with fewer side effects.24 

How many people with psychiatric disabilities are inappropriately institutionalized? Although 

people with serious mental illnesses may need short-term hospitalization at times, from the 

experience of state hospital closures25 and the outcomes of consumer-directed services and 

certain intensive case management models, most people with mental illnesses who might 

otherwise be confined in state psychiatric hospitals26 clearly can be supported in their own homes 

in the community. 

(d) Other Institutions, Including Board and Care Facilities, Shelter Facilities 

In 1990, the states reported a total of 514,749 licensed board and care beds serving adults and 

elders in 35,171 board and care homes. By 1997, these figures had increased to 827,584 beds in 

49,913 board and care facilities, but the increase is considered to be due in part to more complete 

reporting from the states. The average number of board and care beds per facility was 16.6 in 

24Department of Health and Human Services, Mental Health: Culture, Race and Ethnicity 

(2001) at 63–64, 67. This study also found that mental health service systems “fail[...] to provide 

for the vast majority of Latinos in need of care.” Id. at 146. 

25See, e.g., the placement of residents of Haverford State Hospital described in Kathleen 

S. v. Department of Public Welfare, 10 F.Supp. 2d 476 (E.D. Pa. 1998) and 1999 U.S. Dist. 

LEXIS 19498 (E.D. Pa.). 

26Federal/Provincial/Territorial Advisory Network on Mental Health, Review of Best 

Practice in Mental Health Reform (1997) at 7, 79. 

17

1997.27 Because residents of board and care homes by definition require a lower “level of care” 

than nursing facility residents (that is, they do not qualify for nursing facility services on the basis 

of the intensity of services they require), they are by definition less disabled than residents of 

nursing facilities. If most nursing facility residents could live in their own homes and 

communities with support, then, a fortiori, most residents of board and care facilities could live 

in the community. 

3. Barriers to Community Integration 

It is beyond question that hundreds of thousands of unnecessarily institutionalized persons with 

disabilities are kept in isolated living situations by systemic barriers that include the very human 

service systems that are charged with providing appropriate services to them. As the 

self-advocates who gathered at the 2000 Conference on Self-Determination stated in the 

declaration that emerged from the conference, 

Citizens who have disabilities experience oppression in many aspects of their 

lives. The causes of oppression include poverty, other people’s attitudes, and the 

systems of publicly and privately funded support services, comprising – 

laws, policies and regulations; 

state and private sector funding bodies; 

agencies which provide services. 

These systems operate in ways that deny control to those they are intended to 

serve. Without accountability to those who require their assistance, these systems 

decide how, where and with whom people shall live and spend their days. While 

this situation persists, people of many nations will not be able to exercise their 

rights or fully participate in their communities.28 

27C. Harrington et al., 1997 State Data Book on Long Term Care: Program and Market 

Characteristics (University of California at San Francisco, 1999) at 3. 

28The Seattle 2000 Declaration on Self-Determination and Individualized Funding. 

18

The persons with disabilities whom we interviewed were asked to identify the barriers to 

community integration for persons with disabilities. We weighted these barriers by the 

importance that individual respondents gave to the barrier when they listed more than one, which 

shows that lack of affordable and accessible housing was perceived as the biggest barrier. The 

result was the same for persons with physical, developmental, and psychiatric disabilities. The 

barriers that respondents identified are listed here in order of rank: 

Affordable and accessible housing (38)


Quality support staff (35)


Parent/guardian opposition (30)


Lack of affordable and accessible transportation (28)


Lack of adequate medical or dental care (26)


Neighborhood opposition (23)


Lack of jobs and job training (14)


Lack of residential services (11)


Lack of day services (8)


Other barriers mentioned by respondents were lack of social networks and friends; the need to 

learn skills; and political issues, such as state employees’ need to keep their jobs and absence of 

crisis intervention. 

No respondent with physical or psychiatric disabilities mentioned lack of day programs as a 

barrier, and respondents with developmental disabilities ranked it low. Housing, quality (or 

well-paid) support staff, and lack of access to medical and dental services were ranked high as 

barriers by persons in all disability groups. Parent/guardian opposition and neighborhood 

opposition were ranked high by persons with developmental disabilities, but not by persons with 

19

physical or psychiatric disabilities. Persons with psychiatric disabilities perceived lack of access 

to medical care as an important barrier.29 

The experience reported by the people with disabilities whom we interviewed is amply validated 

by the literature on obstacles to community integration. 

(a) Lack of Affordable or Physically Accessible Housing 

It is little wonder that persons with disabilities and disability rights advocates identify lack of 

affordable or physically accessible housing as the single biggest barrier to community integration. 

Persons with disabilities are disproportionately poor, especially the persons who are most likely 

to be affected by the Olmstead decision, who rely on Supplemental Security Income (SSI) and 

other government benefits. 

For low-income people with disabilities, affordable housing means subsidized 

housing that is either developed or rented through government housing programs. 

Because most funding for these programs comes directly or indirectly from the 

U.S. Department of Housing and Urban Development (HUD), there are 

potentially significant implications for federal housing policies and programs in 

the Olmstead decision. Thus far, however, the affordable housing issues raised by 

the Olmstead decision have received scant attention.30 

Nationally, SSI benefits are equal to only 18.5 percent of the one-person median household 

income. The result is no housing market anywhere in the country in which SSI 

beneficiaries—who numbered more than 3.5 million adults with disabilities in 2000—can afford 

29See interview with Debra Delman, who noted that people using public mental health 

service die 10 to 20 years earlier than others. Consumers and survivors have found that some 

physicians tend to regard their psychiatric disabilities as primary and do not pay adequate 

attention to signs of physical illness. 

30Technical Assistance Collaborative and Consortium for Citizens with Disabilities 

(CCD) Housing Task Force, 12 Opening Doors (December, 2000) at 1. 

20

decent housing with their monthly income of about $512 without government subsidies.31 Thus, 

access by people with disabilities to a fair share of the approximately $7 billion in federal 

housing subsidy programs is vital to their ability to afford decent and accessible housing in their 

own communities and neighborhoods. 

The unmet housing needs of persons with disabilities, however, cannot be attributed to poverty 

alone. HUD data show that people with disabilities between the ages of 18 and 62 make up more 

than 25 percent of the 4.9 million households with the “worst case” housing needs, yet these 

persons represent only about 13 percent of the households that currently receive federal housing 

assistance. From 1997 to 1999, the number of households with “worst case” housing needs 

declined by 8 percent, probably as a result of economic prosperity, and the decline occurred in 

every group eligible for federal housing assistance except persons with disabilities. Indeed, 

housing needs among persons with disabilities may have increased during this period.32 

A report published by the Technical Assistance Collaborative, Inc. (TAC), and the Consortium 

for Citizens with Disabilities (CCD) Housing Task Force identified the following barriers to 

expanding housing opportunities for persons with disabilities: 

� State and local officials do not give a high priority to the housing needs of persons 

with disabilities. 

� Most Public Housing Authorities (PHAs) do not give a high priority to the 

housing needs of persons with disabilities. 

� Most disability organizations have not established relationships or partnerships 

with affordable housing providers and funding sources. 

31A. O’Hara and E. Miller, Priced Out in 2000: The Crisis Continues (Boston, MA: The 

Technical Assistance Collaborative and Consortium for Citizens with Disabilities (CCD) 

Housing Task Force, 2001) at 10; see also Technical Assistance Collaborative and CCD Housing 

Task Force, 12 Opening Doors (December, 2000) at 4. 

32A. O’Hara and E. Miller, Priced Out in 2000: The Crisis Continues (2001) at 7. 

21

� The disability community’s knowledge of the key federal housing programs and 

policies that can assist persons with disabilities is very limited. 

� The disability community has limited knowledge of Fannie Mae housing 

programs targeted to persons with disabilities. 

� Many disability organizations do not understand how participation in HUD’s 

Consolidated Pan process can help expand homeownership and rental housing for 

persons with disabilities. 

� Most homeownership coalitions serving persons with disabilities have achieved 

only modest results, as measured by the number of persons who have become 

homeowners. 

� Disability organizations need more housing knowledge, housing capacity, and 

technical assistance to expand access to affordable housing.

33 

The effect of these barriers is that people with disabilities are cut off disproportionately from 

access to the billions of dollars in federal housing assistance for persons with low incomes. 

Federal housing assistance is provided in accordance with three housing plans required by HUD 

that are prepared at the state and local level subject to HUD approval: (1) the Consolidated Plan, 

or ConPlan; (2) the Public Housing Agency Plan, or PHA plan; and (3) the Continuum of Care 

Plan for homeless assistance. Although these plans are developed separately, the activities to be 

funded through the PHA Plan and the Continuum of Care Plan must be consistent with the 

housing needs and strategies identified in the ConPlan. 

The ConPlan is a comprehensive, long-range plan for development of affordable housing for 

low- and moderate-income households in states and local communities that receive funds from 

33A. O’Hara and E. Miller, Going It Alone: The Struggle to Expand Housing 

Opportunities for People with Disabilities (Boston, MA: The Technical Assistance Collaborative 

and CCD Housing Task Force, 2000) at 2–3. 

22

HUD. It must describe housing needs, market conditions, and housing strategies and set forth an 

action plan for the use of federal housing funds. It specifies how the state or locality will spend 

the money provided through the four principal federal housing subsidy programs, the Community 

Development Block Grant (CDBG), the Home Investment Partnership Program (HOME), the 

Emergency Shelter Grant program, and the Housing Opportunities for Persons with AIDS 

program. The plan must quantify the need for supportive housing for persons with disabilities 

and other support needs. However, because meaningful participation by the disability community 

is poor and the disability community is not adequately represented during the development of 

these plans, people with disabilities are not receiving their “fair share” of the federal housing 

resources that these plans control. Further, because state and local officials have considerable 

discretion in developing a ConPlan, HUD will not necessarily reject a plan simply because it 

does not address the housing needs of people with disabilities.34 And finally, even if the ConPlan 

accurately identifies local housing needs, including those of persons with disabilities, state and 

local officials are not required actually to spend the money to address those needs. HUD can 

withhold block grant funds if a Conplan is not based on a thorough review of local housing 

needs, but then only to require revision of the plan.35 

Advocates of people with disabilities report that “most ConPlans do not accurately describe the 

housing needs of people who may be living in state institutions or facilities or who are at risk of 

institutionalization,” that “housing strategies adopted in most ConPlans do not typically target 

federal housing funding to people with disabilities who are waiting to leave institutional settings,” 

and that little meaningful consultation has occurred between health and human services agencies 

and housing officials about the housing policy issues raised by Olmstead or the housing resources 

34Id. at 7. 

35S. Crowley, “Implementing Olmstead Through Housing Advocacy at the Local, State, 

and Federal Levels,” The NIMBY Report (Spring 2002) at 26. 

23

that could be made available to create more community-based housing for persons who are 

unnecessarily institutionalized.

36 

The “meaningless compliance” inherent in the ConPlan process was identified as one of HUD’s 

management problems in the President’s Management Agenda developed by the Office of 

Management and Budget (OMB) for FY 2002. OMB directed HUD to work with local 

stakeholders to streamline the ConPlan, making it more results-oriented and useful to 

communities. In 2002, HUD convened a ConPlan Improvement Initiative, a series of workgroups 

with stakeholder representation, including that of people with disabilities, to examine how the 

ConPlan can better be linked to other federally mandated plans for transportation or human 

services, how goals should be determined, and how results will be measured.37As of March 2003, 

the process is far from complete. 

The ADA community integration mandate-and the extreme poverty of people receiving SSI 

benefits-should compel government housing officials to target an equitable share of ConPlan 

funding to people with disabilities.38 That equitable share should include a fair share of the funds 

available through the HOME program, which can be used to fund the acquisition, rehabilitation, 

or new construction of housing for people with disabilities and to fund two-year rental assistance 

subsidies for persons leaving institutions. The manner in which HOME funds are used is decided 

through the ConPlan process.39 

36Technical Assistance Collaborative and Consortium for Citizens with Disabilities 

(CCD) Housing Task Force, 12 Opening Doors (December 2000) at 8. 

37S. Crowley, supra, at 28–29. HUD, ConPlan Improvement Initiative, at www.hud.gov. 

38Id. at 8. 

39Id. at 8–9. 

24

The Section 8 program (renamed the Housing Choice Voucher Program in 1998, but still known by 

its more familiar name), which provides rental vouchers for people with the lowest incomes, 

including SSI beneficiaries and currently assists more than 1.4 million households nationwide, is 

controlled by PHAs. These PHAs have authority to decide how public housing and Section 8 

vouchers should be used in their communities, pursuant to a PHA Plan that is submitted to HUD 

for approval.40 Section 8 includes programs targeted to people with disabilities. In addition, people 

with disabilities are also eligible for the general voucher program, known as the “fair share” 

program. In 2001, Congress appropriated funding for 79,000 new “fair share” vouchers. Beginning 

in 2000, HUD’s “fair share” application process assigns 15 points to any housing authority (thus 

giving it an advantage in the competitive application process) that agrees that 15 percent or more of 

the vouchers requested will be used for people with disabilities. In addition, HUD will assign 

another 5 points if the PHA provides at least 3 percent of the requested Section 8 vouchers to 

persons who are receiving services under a home- and community-based service waiver.41 

According to an analysis by the Technical Assistance Collaborative (TAC), only 224 of the 499 

PHAs that received Section 8 vouchers in 2000 agreed to the set-asides for persons with 

disabilities; in 2001, the number increased to 422 of 475 PHAs.42 However, the data collected by 

TAC show that only 171 of the 475 housing authorities set aside 3 percent of their vouchers for 

home- and community-based waiver beneficiaries.43 

40Id. at 9; A. O’Hara and E. Miller, Going It Alone: The Struggle to Expand Housing 

Opportunities for People with Disabilities (2000) at 10. 

41Department of Housing and Urban Development, “HUD Awards $448 million in 

Housing Assistance Vouchers,” press release 01-060 (July 2, 2001); Stephen F. Gold, “Section 8 

Vouchers and People with Disabilities: Information Bulletin #3 (July 17, 2001). 

42Technical Assistance Collaborative, Housing Center for People with Disabilities, “Fair 

Share Vouchers,” http://www.tacinc.org/hc/fairshare.htm. 

43Technical Assistance Collaborative, Fiscal Year 2001 Fair Share Voucher Awards, 

http://www.tacinc.org/hc/2001FairShare.pdf. 

25

On October 12, 2000, HUD issued a final regulation enabling Section 8 vouchers to be used for 

mortgage payments. However, local PHAs are not required to participate in this program. 

Further, the PHA can choose to make Section 8 homeownership assistance available to any 

qualified application, or it can limit which families will participate. The inclusion of persons with 

disabilities in the program will depend significantly, therefore, on advocacy at the local level.44 

The Section 8 program also includes vouchers targeted specifically to people with disabilities. 

Before 1992, HUD’s Section 202 program required owners of certain HUD-subsidized housing 

developments to house elderly persons and nonelderly people with disabilities on an equal basis. 

In 1992, a change in federal law allowed owners to designate these units as “elderly only,” and 

many did. This significantly restricted access by nonelderly people with disabilities to the 

housing units. Beginning in 1997, Congress has appropriated funding for Section 8 vouchers 

designated for persons with disabilities to compensate for the loss of housing in projects now 

designated “elderly only” projects. These vouchers are available to PHAs that document the loss 

of housing for people with disabilities in their jurisdictions.45 However, in spite of the fact that 

the new funding would make up only a fraction of the housing units that have become 

unavailable to people with disabilities since the “elderly only” provision went into effect, HUD 

data show that, at most, 10 percent of the PHAs that administer the Section 8 program applied to 

HUD each year since 1997 to make these vouchers available to people with disabilities. The 

percentages of PHAs that applied were 9 percent in 1997, 10 percent in 1998, and 8 percent in 

44K. Kleinman, “Homeownership and Section 8” (July 16, 2001). 

45A. O’Hara et al., “What’s Wrong with this Picture?” 15 Opening Doors (September, 

2001); Technical Assistance Collaborative, Housing Center for People with Disabilities, “Section 

8 Housing Choice Vouchers for People with Disabilities,” http://www.c-c-d.org/od-Sept01.htm 

A. O’Hara and E. Miller, Going It Alone: The Struggle to Expand Housing Opportunities for 

People with Disabilities (2000) at 9. 

26

1999.46 Funding for another 10,000 vouchers has been appropriated since 1997 for the Section 8 

Mainstream Program for People with Disabilities. 

In 2000, Section 8 programs targeted to people with disabilities provided a total of 8,761 

vouchers for people with disabilities (both elderly and nonelderly). Other HUD programs 

targeted to people with disabilities are the Section 811 Supportive Housing Program, the Section 

202 Assisted Living Program (designed to serve frail elderly persons and elderly persons with 

disabilities), and the Services Coordinators program, which provides funding to owners of 

private housing developments to hire service coordinators to help persons with disabilities and 

elders obtain independent living services. Collectively, these programs were funded in 2000 at a 

total of $271.4 million. In comparison, HUD’s largest affordable housing programs—the CDBG, 

funded at $4.8 billion in 2000, and HOME, funded at 1.6 billion—are potentially available to 

persons with disabilities but, as discussed above, are not designed to ensure that people with 

disabilities will, in fact, obtain a fair share of these benefits.47 A 1999 survey of disability 

organizations found that very few of these organizations’ constituencies had been able to access 

“generic” affordable housing programs, such as HOME and the CDBG.

48 

The Technical Assistance Collaborative (TAC) and the CCD Housing Task Force have 

concluded that “[t]he stigma experienced by people with disabilities persists in many 

communities, and makes accessible or developing affordable housing difficult. Often, PHAs, 

46A. O’Hara and E. Miller, Going It Alone: The Struggle to Expand Housing 

Opportunities for People with Disabilities (2000) at 13–14. 

47Bianco et al., Overcoming Barriers to Community Integration for Persons with Mental 

Illness (SAMHSA, 2001) at 34. HUD also distributes 60,000 Section 8 vouchers to PHAs that 

state in their applications that 15 percent or more of the vouchers requested will be used to serve 

persons with disabilities. Id. 

48A. O’Hara and E. Miller, Going It Alone: The Struggle to Expand Housing 

Opportunities for People with Disabilities (2000) at 18. 

27

housing developers and city officials would rather avoid serving people with disabilities than 

face the possible controversy.”49 This conclusion is echoed by a Substance Abuse and Mental 

Health Services Administration (SAMHSA) report that “in spite of the passage of the Fair 

Housing Amendments Act (FHAA) of 1988 [extending protection from discrimination in 

housing to people with disabilities], discrimination against people with mental illnesses is 

perhaps most prevalent when it comes to housing.”50 A further barrier to housing for persons 

with mental health disabilities is the perception that those persons need supervision and 

’round-the-clock support from on-site staff. In fact, “the overwhelming majority of people with 

mental illnesses can live in their own homes.”51 

(b) Lack of Jobs, Job Training, and Supported Employment 

Unemployment rates for persons with significant disabilities are high and have not appreciably 

diminished since 1990, when the ADA was enacted. The Surgeon General reports that the 

unemployment rate for persons with significant psychiatric disabilities is around 90 percent.52 

Related to the lack of meaningful employment experienced by far too many people with disabilities 

is the failure of the federal Vocational Rehabilitation (VR) program to adequately serve people 

with mental disabilities. That program, which provides approximately $2.5 billion annually to the 

states to provide job training for persons with disabilities who seek to enter or re-enter the work 

49Id. at 9. 

50Bianco et al., Overcoming Barriers to Community Integration for Persons with Mental 

Illness (SAMHSA, 2001) at 31. 

51Id. at 31 (emphasis in original). 

52United States Department of Health and Human Services, Mental Health: A Report of 

the Surgeon General (1999). 

28

force,53 is ineffective at helping persons who are or have been institutionalized obtain and sustain 

mainstream employment. Recent studies have documented the dismal record of state vocational 

rehabilitation agencies in achieving meaningful employment outcomes for persons with 

disabilities.54 

Reasons for the ineffectiveness of VR services for people with mental disabilities include the 

time-limited nature of those services; the use of “weighted closure” systems that reward counselors 

for closing cases and create disincentives for serving persons with significant disabilities; the 

emphasis on disability-determination activities over direct service; the lack of specialized expertise 

in mental disabilities; the failure to coordinate with mental health/mental retardation and other 

disability service programs; and the unrealistic funding and durational service limitations that can 

make it difficult for employment vendors to provide meaningful services to persons with 

significant disabilities.55 Advocates echo the conclusion of formal studies that federal regulations 

governing the VR program “do not match with the individualized employment goals of the 

program.”56 Employment experts have recommended that more of the funds currently spent on VR 

services be “reprogrammed” and redirected into programs based on models of supported 

53United States Department of Education, “President Bush Requests $56.5 Billion for 

Department of Education,” Press Release (February 4, 2002). 

54J. Noble et al., A Legacy of Failure: The Inability of the Federal-State Vocational 

Rehabilitation System to Serve People With Severe Mental Illnesses (National Alliance for the 

Mentally Ill, 1997); J. J. Bevilacqua, “The State Vocational Rehabilitation Agency: A Case for 

Closure,” 10 J. Disability Policy Studies 90 (1999); see Bianco et al., Overcoming Barriers to 

Community Integration for Persons with Mental Illness (SAMHSA, 2001) at 38. 

55J. Noble et al., A Legacy of Failure: The Inability of the Federal-State Vocational 

Rehabilitation System to Serve People With Severe Mental Illnesses (National Alliance for the 

Mentally Ill, 1997). 

56J.R. Harding, National Association of Alcohol, Drugs and Disabilities, Florida 

Vocational Rehabilitation, National Listening Session, PM testimony at 165–166. 

29

employment, psychosocial rehabilitation, independent living services, and other support services 

that could enable persons with significant disabilities to succeed in employment.57 

(c) Disincentives to Work in Public Benefits Programs 

Although very many persons with disabilities who receive SSI and Social Security Disability 

Insurance (SSDI) benefits want to work and would be able to work with appropriate support, 

relatively few are able to do so because of the disincentives to work created by the eligibility 

rules for these programs. According to a 1998 study by the General Accounting Office (GAO), 

only one in 500 SSDI beneficiaries in that year left the rolls by returning to work.58 These data 

suggest that it is unrealistic to expect significant numbers of people with disabilities to be able to 

replace public benefits with income from competitive employment and that the great majority of 

people with disabilities could benefit from income maintenance programs that make it possible to 

continue to receive public benefits while receiving additional income from employment. 

The Social Security Administration (SSA) reports that the fear of losing health care benefits is 

the largest barrier preventing people with disabilities from returning to work. Further, the work 

incentive programs within SSI, SSDI, Medicare, and Medicaid are poorly understood and 

underused. Increases in income from work may also cause increases in rent under Section 8 

housing programs, loss of food stamps, or decreases in public assistance benefits.59 

57J. Noble et al., A Legacy of Failure: The Inability of the Federal-State Vocational 

Rehabilitation System to Serve People With Severe Mental Illnesses (National Alliance for the 

Mentally Ill, 1997). 

58Social Security Disability Insurance: Multiple Factors Affect Beneficiaries’ Ability to 

Return to Work (General Accounting Office, GAO-HEHS-98-39, 1998). The same study found 

that receipt of SSDI benefits was negatively associated with the success of return to work 

interventions. 

5965 Federal Register 105 (May 31, 2000): Cooperative Agreements for Benefits 

Planning, Assistance, and Outreach Projects; Program Announcement No. SSA-OESP-00-1. 

30

For persons who need personal assistance for work or daily living, the absence of sliding fee 

scales for personal assistance services is another major disincentive to work because income 

limits are too low to allow persons with disabilities to be able to pay to replace the services paid 

for by public benefits. Replacing the current “on/off switch” for eligibility with a sliding fee scale 

that can accommodate those who can pay privately, those who can pay part of the cost of their 

services, and those who cannot pay at all is critical.60 

(d) Shortage of Personal Care Assistance 

Until 1980, primarily registered nurses employed by visiting nurses’ associations and public


health agencies, as well as family and friends provided support services to people with


disabilities in their homes. In the 1980s, changes in Medicare certification and reimbursement


policies, the Title XIX home- and community-based waiver amendments of OBRA 1981, and the


redefinition of the “homebound” eligibility requirement of Medicare in 1987 led to enormous


growth in the number of persons working as personal care assistants.61 Title XIX funds pay for


services by home health aides, defined as “services related to a patient’s physical requirements,”


similar to the services that would be performed by a nurse’s aide in a hospital or nursing


facility.

62 Home health aides perform such services as homemaking, bathing, feeding, shopping,


and assisting consumers with other activities of daily living.


The availability of personal care assistance is vital to enabling persons with disabilities to avoid


institutionalization. Personal care assistants enable people with disabilities to accomplish a wide


60B. Kafka, “Home Care and the Disability Community,” Caring (July 1998) at 28. 

61Service Employees International Union, “Home Care Workers: A Briefing Paper” (May 

1999) at 2. 

62Health Care Financing Agency, State Medicaid Manual, HCFA Publication 45-4 

§ 4480, Transmittal No. 67 (April 1995). 

31

range of daily living tasks that they would perform themselves if they did not have a disability, 

including support with eating, dressing, bathing, grooming, and transferring, as well as 

health-related tasks, such as medication administration. Personal care assistant jobs are typically 

entry-level, offer few benefits, often do not even provide reimbursement for travel to clients’ 

homes, and pay an hourly wage that is typically about two or three dollars above the minimum 

63 wage. 

Because of worker shortages, people with disabilities for whom the state has authorized personal 

assistance services often do not receive all the hours of service they are entitled to and sometimes 

fail to receive those services at all. A survey of home care waiver recipients in Minnesota, for 

example, found that none of the consumers was receiving all the services for which the consumer 

was authorized.64 

(e) Low Wages of Support Staff 

In 1998, the President’s Advisory Commission on Consumer Protection and Quality in the 

Health Care Industry reported that 2 million health care paraprofessionals worked in the home 

care sector, of whom 600,000 were earning wages below the poverty line.65 A survey of state 

63S. Yue, “A Return to Institutionalization Despite Olmstead v. L.C.? The Inadequacy of 

Medicaid Provider Reimbursement in Minnesota and the Failure to Deliver Home-andCommunity Based Waiver Services,” 19 Law & Ineq. J. 307, 329–331 (2001). 

64Id. at 333. 

65President’s Advisory Commission on Consumer Protection and Quality in the Health 

Care Industry, Quality First: Better Health Care for all Americans: Final Report to the President 

(May 1998) at 205. 

32

legislative priorities by the National Conference of State Legislatures identified workforce issues, 

including shortages of personnel, as one of the four highest priorities.66 

Low wages for direct support staff are the result of low reimbursement rates for personal assistance 

services by state Medicaid and human services agencies. Low reimbursement rates not only fail to 

attract adequate numbers of support staff but also affect the competence of the staff who do fill 

those positions and ensure that those jobs remain entry-level, low-skill, high-turnover jobs.67 

Wages and benefits in community services are not competitive with jobs requiring comparable 

education, training, experience, and skill. They are not competitive even with jobs requiring 

significantly lower education, training, experience, and skill, such as fast food jobs. In many states, 

wages and benefits for direct care and professional staff in community services are radically lower 

than those in institutions. For example, in California a 1993 study found that the differential in 

average direct care staff wages and benefits between institutions and community-based services 

was 124 percent.68 A legislative committee in the same state found that “as a result of low rates, 

vendors are having extreme difficulty in maintaining existing employees, and in hiring and 

training new employees.” The subcommittee also found that “staff turnover results in a lower 

quality of service and can jeopardize the health and safety of the consumers receiving services” 

because “specialized knowledge about consumers and their needs comes from long-term 

relationships with direct care staff.” Further, the subcommittee found, “without these services 

66National Conference of State Legislatures, Health Chairs Project Survey of State Health 

Priorities for 2001 (2001). 

67S. Yue, A Return to Institutionalization Despite Olmstead v. L.C.? The Inadequacy of 

Medicaid Provider Reimbursement in Minnesota and the Failure to Deliver Home-andCommunity Based Waiver Services, 19 Law & Ineq. J. 307, 329–332 (2001). 

68Mitchell et al., Compensation and Turnover of Direct-Care Staff in Developmental 

Disabilities Residential Facilities in the United States: Wages and Benefits, 51 Mental 

Retardation 429, 433 (Dec. 1993). 

33

many consumers now living in the community would be forced into more restrictive 

environments.”69 

(f) Service Models and Financing Systems That Limit Self-Determination and Choice 

When asked to identify state or federal policies that hinder the ability of persons with disabilities 

to move into or live in the community, the persons with disabilities whom we interviewed 

identified the following: 

� The institutional bias of Medicaid 


� The status of nursing facilities as a required service


� The status of personal care as an optional service


� Intermediate care facilities for the mentally retarded (ICFs/MR) 


� Funding that encourages congregating people together


� Funding that encourages investment in “bricks and mortar”


� The mind-set that people have to live in a “program”


� The lack of adequate wages for direct service staff


� That waivers have to be renewed, and institutional services don’t


� More dollars going to the institution 


� Policies that do not allow paying family members at home, but pay for services in


a nursing facility 

� VR not being used properly to support persons with severe disabilities. 

Many respondents simply identified “funding” as a barrier or cited the imbalance in funding 

between institutions and community services. 

69Senate Budget and Fiscal Review Comm. Subcomm. No. 3 On Health, Human Services, 

Labor and Veterans Affairs 47 (April 3, 2000) at 477, 48 (emphasis in original). 

34

The programmatic and funding obstacles identified by people with disabilities are well supported 

in the literature. The Medical Assistance program, Title XIX of the Social Security Act,70 is the 

principal source of funding for long-term care services in the United States. Title XIX is a federal 

program operated by the states to provide medical and rehabilitation services. In 1998, Title XIX 

financed about 40 percent of the nation’s total long-term care spending of $150 billion.71 

Nursing facility services are a required Title XIX service; all states that accept Medicaid funding 

are required to provide those services to all eligible persons who request them. Although service 

in an ICF/MR is an optional state plan service, all the states have elected to provide that service 

and therefore are obligated to provide services in an ICF/MR to all eligible persons who request 

them. Unlike personal care, home health services, and home- and community-based waiver 

services, which the states have great flexibility in designing, the nursing facility and ICF/MR 

programs require the states to provide 24-hour care according to a detailed set of regulations. 

Further, the financial eligibility rules for institutional services are far more generous than the 

requirements for community services. A person can qualify for Medicaid in a nursing home with 

income up to 300 percent of the federal poverty level. Unless an exception is granted under a 

waiver, this rule does not apply to people who live in the community. Similarly, spousal deeming 

of income rules protect the income and assets of the spouse of a nursing facility resident but not 

the income and assets of the spouse of a person who receives Medicaid services at home. For 

children placed in institutions, the state may not count the parents’ income in determining the 

child’s eligibility, but this is not the case for families who care for their children at home.

72 

7042 U.S.C. § 1396 et seq. 

71A.I. Batavia, “A Right to Personal Assistance Services: ‘Most Integrated Setting 

Appropriate’ Requirements and the Independent Living Model of Long-Term Care,” 27 Am. J. L. 

& Med. 17, 23 (2001). 

72U.S. Department of Health and Human Services, Self-Evaluation to Promote 

Community Living for People with Disabilities (2002) at A-55. 

35

In the 35 states that have exercised the option to cover persons who are “medically needy,” that 

is, to allow persons with high medical expenses to “spend down” periodically to financial 

eligibility levels, the eligibility requirements for community services are in theory not as onerous. 

In practice, however, the spend-down limits are often so low that people receiving Medicaid 

services in the community have insufficient income to cover basic living expenses. In 21 states, 

the medically needy income level is below the level for SSI benefits (currently about $512 a 

month for an individual), and seven of those states have levels that are less than 50 percent of the 

SSI rate. A new federal rule promulgated last year gives spend-down states the option to allow 

individuals to meet the spend-down level while retaining more of their income for basic 

necessities, but few states have chosen this option.73 

As a result of the institutional bias of Title XIX, about three-fourths of Medicaid spending on 

long-term care is allocated to institutional services. For example, in fiscal year 1998, 58 percent 

of Medicaid long-term care expenditures were spent on nursing facility services, 17 percent on 

ICF/MR services, 15 percent on home- and community-based waivers, 6 percent on the personal 

care option, and 3 percent on home health care. Statistics for 2000 compiled by American 

Disabled for Attendant Programs Today (ADAPT) from data supplied by the MEDSTAT Group, 

the Health Care Financing Administration (HCFA) 64 data, Office of State Agency Financial 

Management, show only two changes in these percentages in 2000, a decrease from 17 to 15 

percent for ICF/MR spending and an increase from 15 to 18 percent for spending on home- and 

community-based waivers. (In June 2001, HCFA changed its name to CMS.) Although Title XIX 

spending on home- and community-based services increased more than spending on institutional 

services between 1994 and 1999, from about $8 billion to $16 billion, spending on institutional 

services increased as well, from about $37 billion to about $46 billion. Medicaid spending on 

nursing facilities increased from $23.2 billion in 1990 to $44.4 billion in 2000, and the CMS 

projects that by the year 2001, Medicaid expenditures on nursing facilities will increase to $81.5 

73Id. at A-57. 

36

billion. Although the percentage of Medicaid funds spent on institutional services varies from 

state to state, all states except Oregon spent more on institutional services in 1999 than on homeand community-based services.74 

Some advocates indicated that the current delivery system only intensifies existing unmet 

needs-needs for long-term care at home and in the community for people with disabilities. A 

representative of the service provider organization ANCOR echoed the view that persons with 

disabilities are dependent on “a 40-year-old, outdated, federal long-term support program and 

financing mechanism, that is ... predicated on a ... statutory institutional bias, making home and 

community based services an option.” This results in “inconsistent and disparate community 

services, not only between states but within the states.”75 

Similarly, the National Association of State Mental Health Program Directors stated in a letter to 

the Secretary of Health and Human Services that “certain federal policies actually obstruct the 

efforts of states, providers, and consumers to enable individuals with mental illnesses to receive 

effective treatment and participate fully in community living. People with mental illnesses 

continue to face discrimination and other barriers in federal programs.”76 

74Statistics derived from data on www.hcbs.org and http://cms.hhs.gov/statistics/nhe/ 

historical/ty.asp; K. Kleinmann, “Money to Institutions” (Steve Gold’s Treasured Bits of 

Information News Group Archives, July 16, 2001) (Information compiled by ADAPT from data 

supplied by The MEDSTAT Group, Inc.; see W. Fox-Grage et al., Community-Based Long-Term 

Care (National Conference of State Legislatures: Promising Practices Issue Brief (2000) at 2. Of 

total Medicaid expenditures of $180 billion in 1999, about $62 million were allocated to longterm care services. Medicaid pays about two-thirds of the cost of nursing facility services and a 

similar proportion of long-term care spending for mental retardation and developmental 

disabilities services. 

75Testimony of American Network of Community Options and Resources (ANCOR), 

National Listening Session, PM testimony at 192–93. 

76Letter from Barry S. Kast and Robert W. Glover, National Association of State Mental 

Health Program Directors, to Tommy Thompson, May 18, 2001, at 1. 

37

Title XIX Waivers and Optional Services: The Personal Care Option, Rehabilitation 

Option, Targeted Case Management Option, Home- and Community-Based Waivers, and 

Demonstration Waivers. These provisions of Title XIX offer states the option to fund homeand community-based services with Medicaid dollars. Especially in the case of the home- and 

community-based waiver, they afford enough flexibility to fund relatively innovative service 

models, such as self-determination and consumer-directed personal assistance. However, unlike 

services in a nursing facility that are required of any state that participates in Title XIX, these 

services do not have to be provided unless the state elects to do so. Thus, the availability of these 

services varies from one state to another, and the type of services that are funded also varies, 

sometimes dramatically. 

The personal care option can be used to support a person with disabilities in any setting, 

including the person’s own home. However, because Title XIX dollars cannot be used to pay 

family members for providing personal care or other services, states must receive a research and 

demonstration waiver to support programs that allow payments to spouses and family members.77 

The rehabilitation option can be used to fund various types of rehabilitative services for people 

with mental illnesses. According to 1998 data collected by the Bazelon Center for Mental Health 

Law, all but 10 states had elected to cover psychiatric rehabilitation services under this option. 

However, states that do provide the rehabilitation option often use a restricted definition of those 

activities.78 

77For examples of projects funded with Section 1115 research and demonstration waivers, 

see http://www.hcbs.org/promising_practices. 

78Bazelon Center for Mental Health Law, Under Court Order: What the Community 

Integration Mandate Means for People with Mental Illnesses (1999) at 6. The 11 states that have 

not opted to provide rehabilitation services are Connecticut, Georgia, Idaho, Indiana, Iowa, 

Kentucky, Montana, Nevada, New Jersey, and Utah. 

38

The targeted case management option is one of the most flexible options available under Title 

XIX. The option can be targeted to a specific population, such as persons who are “chronically 

mentally ill,” and does not have to be offered statewide. However, 23 states do not target 

intensive case management services to adults with mental illness.79 

Although the Title XIX home- and community-based services waiver—created by an amendment 

to the Social Security Act in 198180 —allows states great flexibility in supporting people with 

disabilities in the community, it has not leveled the playing field between institutional and 

community services, let alone eradicated the institutional bias within Title XIX. Because state 

governments do not recognize home- and community-based waiver services as an entitlement, as 

they do with nursing facility and ICF/MR services, waiting lists for waiver services are large in 

many states.81 

Further, the waiver is used much more extensively for some groups of people with disabilities 

than for others. According to statistics released by the NIDRR in October 2001, there were 75 

home- and community-based waivers for persons with mental retardation or developmental 

disabilities, serving a total of 216,570 persons in 1997.82 However, only two states had obtained 

home- and community-based waivers for persons with mental illnesses in 1997, serving a total of 

79Id. at 6. The 23 states are Alaska, Arizona, Arkansas, California, Colorado, Connecticut, 

Delaware, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Massachusetts, Nebraska, 

Nevada, New Mexico, Oregon, South Carolina, Tennessee, Utah, and Washington. 

8042 U.S.C. 1396n(c). 

81Gary Smith, in Closing the Gap—Addressing the Needs of People with Developmental 

Disabilities Waiting for Supports (National Association of State Directors of Developmental 

Disabilities Services, 1999), estimates that between 80,000 and 200,000 persons with 

developmental disabilities are on waiting lists for home- and community-based services or 

experience significant delays in receiving those services. 

82NIDRR, Medicaid Home and Community Based Services, Disability Statistics Report 16 

(October 2001). 

39

626 persons.83 By 2001, only two more mental health waivers had been granted.84 The waiver is 

not often used to provide home- and community-based services to persons with serious mental 

illness. Only Colorado has a home- and community-based waiver focusing specifically on 

persons with serious mental illness. Colorado’s mental health waiver serves adults who would 

otherwise be in a nursing facility, and most are older than 60.85 As of 1999, only three states had 

obtained home- and community-based waivers for children with mental health needs and two 

more had applied.86 

Under a rule dating from the origins of the Medicaid program, Title XIX reimbursement is not 

available for services in psychiatric institutions or Institutions for Mental Diseases (IMDs) for 

persons between the ages of 22 and 64. The IMD exclusion poses a barrier to the development of 

community mental health services under home- and community-based services waivers 

authorized by Section 1915(c) of the Social Security Act, 42 U.S.C. § 1396n(c) because the 

exclusion effectively bars the granting of waivers to serve persons who absent the waiver would 

require services in an IMD, unless those persons are also eligible for services in a nursing 

facility. To obtain a 1915(c) waiver, states must demonstrate that the Title XIX expenditures on 

waiver services will offset the Title XIX dollars that otherwise would be spent on institutional 

services. Thus, because no Title XIX funds are available for services for adults under 64 in 

mental hospitals, the option is extremely difficult to use to enable adults with mental illness to 

83Id. 

84Bianco et al., Overcoming Barriers to Community Integration for Persons with Mental 

Illness (SAMHSA, 2001) at 52. 

85Bazelon Center for Mental Health Law, Under Court Order: What the Community 

Integration Mandate Means for People with Mental Illnesses (1999) at 8. 

86Bazelon Center for Mental Health Law, Under Court Order: What the Community 

Integration Mandate Means for People with Mental Illnesses (1999) at 9. 

40

move from hospitals or specialized nursing homes that are considered IMDs.87 he statute has also 

been interpreted to prevent states from using Title XIX expenditures in Residential Treatment 

Facilities (RTFs) as a cost offset for home- and community-based waivers to serve children in 

community settings.

88 Because group homes for 16 or fewer persons are not considered IMDs 

under Title XIX, however, states may bill Medicaid under 42 U.S.C. § 1396a(i) for group home 

staff and other mental health services provided to group home residents.89 States may also fund 

mental health and substance abuse services under the Section 1915(b) waiver, which allows 

states to waive Medicaid’s freedom of choice provisions and require Medicaid beneficiaries to 

receive services through a managed care plan. Most states use Section 1915(b) only to fund acute 

mental health and substance abuse services; a few, such as Colorado, have used it to fund 

long-term services for persons with significant or persistent mental illness.90 

Although the IMD exclusion prevents federal funds from being used for home- and 

community-based waiver services to adults with mental illnesses, repealing the exclusion would 

merely create another incentive for institutionalization. Opponents of repealing the exclusion 

point out that little evidence exists that states would request home- and community-based 

waivers for IMD residents if the exclusion did not exist. For example, as of 2001, only three 

87Bazelon Center for Mental Health Law, Under Court Order: What the Community 

Integration Mandate Means for People with Mental Illnesses (1999) at 7. 

88G. Smith, et al., Understanding Medicaid Home and Community Services: A Primer 

(2000) at 182. 

89Bazelon Center for Mental Health Law, Under Court Order: What the Community 

Integration Mandate Means for People with Mental Illnesses (1999) at 7. 

90G. Smith et al., Understanding Medicaid Home and Community Services: A Primer 

(2000) at 182. 

41

states had home- and community-based waivers for children and one had a waiver for adults who 

would be eligible for funding in an IMD.91 

Mental Health Block Grant. The Mental Health Block Grant (MHBG) is the principal federal 

program designed to support community-based public mental health services and reduce reliance 

on expensive hospitalization. The program is flexible enough to fund a broad range of services, 

including respite for families and services to children whose parents have psychiatric disabilities. 

However, the Administration has proposed to fund the MHBG at the same level in FY 2002 as 

was available in FY 2001.92 This continues a pattern of significant decline in the amount of the 

block grant in real dollars, from more than $250 million in 1981 to less than $100 million in 

1998.93 

The Child Health Insurance Program (CHIP). CHIP, enacted under the Balanced Budget Act 

of 1997,94 provides insurance coverage for health care, including mental health services, for 

children in low-income families who were not, at the time of the statute’s enactment, eligible for 

Medicaid under their state’s eligibility rules. States can include CHIP-eligible children as an 

eligible group under Medicaid, create a separate health program for them, or both. The first 

option provides the most complete coverage, but only 23 states have adopted it.95 

91Bianco et al., Overcoming Barriers to Community Integration for Persons with Mental 

Illness (SAMHSA, 2001) at 52. 

92Letter from Barry S. Kast and Robert W. Glover, National Association of State Mental 

Health Program Directors, to Tommy Thompson, August 27, 2001 at 2. 

93Bazelon Center for Mental Health Law, Under Court Order: What the Community 

Integration Mandate Means for People with Mental Illnesses (1999) at 12. 

94P.L. 105-33, 111 Stat. 251 (1997), title IV, subtitle J. 

95Bazelon Center for Mental Health Law, Under Court Order: What the Community 

Integration Mandate Means for People with Mental Illnesses (1999) at 10. 

42

Barriers within Medicare. The Medicare program, which provides health care benefits to older 

adults and persons with disabilities who receive benefits under the SSDI program, requires 

higher copayments (50% compared with 20%) and limitations on reimbursement for mental 

health services than for other health services, including for those who receive disability payments 

under the SSDI program.96 The absence of prescription drug coverage under Medicare is a 

serious problem for mental health consumers who require medication as “a first-line defense 

against disabling symptoms.”97 Medicare provides no coverage for other services that are 

extremely important to persons with serious mental illness, including case management and 

psychosocial rehabilitation. 

(g) Lack of Affordable or Physically Accessible Transportation 

Some advocates consider lack of accessible transportation the single largest barrier to the 

inclusion of persons with disabilities in society because it prevents persons with disabilities from 

holding jobs, voting, accessing education or medical care, or participating in ordinary community 

activities.98 

96Lack of parity in private insurance coverage (in lifetime limits, copayments, and 

deductibles) for physical health and mental health conditions also affects the ability of mental 

health consumers to obtain services and support. About half the states have adopted some form 

of parity legislation. “Report from Financing Plank,” National Summit of Mental Health 

Consumers and Survivors (August 26–29) at 6. 

97Letter from Barry S. Kast and Robert W. Glover, National Association of State Mental 

Health Program Directors, to Tommy Thompson, May 18, 2001 at 3; Bianco et al., Overcoming 

Barriers to Community Integration for Persons with Mental Illness (SAMHSA, 2001) at 10. 

98J.R. Harding, National Association of Alcohol, Drugs and Disabilities, Florida 

Vocational Rehabilitation, National Listening Session, PM testimony at 165–66. 

43

(h) State Legislative Appropriations 

State appropriations for mental health services (not including the federal Medicaid match that 

may be available for some services) have declined by 7 percent since 1990 and are significantly 

lower today than they were in 1955, when mental health services consisted primarily of custodial 

care. Spending fell from $16.5 billion to $11.5 billion in 1997 dollars, adjusted for inflation and 

population.99 State appropriations for mental health services have fallen in relation to total state 

spending, state spending on health and welfare, and state spending on corrections. From 1990 to 

1997, the proportion of all state spending allocated to mental health services fell from 2.12 to 

1.81 percent, a decline of 13 percent. 100 

4. Resources and Services Models That Facilitate Community Integration 

(a) General 

We asked the persons with disabilities whom we interviewed, “What policies could the states 

enact that would help people who do not need to be institutionalized live in the community?” 

The responses strongly and consistently favored self-determination and consumer-directed 

models of service. The respondents showed an awareness of how federal housing programs need 

to change to foster community integration, as well as the obvious changes that need to occur in 

the Title XIX program. Many people from all disability groups urged the passage of MiCASSA. 

Our respondents also advocated better information and training for people with disabilities and 

support and funding for self-advocacy. The responses include the following: 

99Bazelon Center for Mental Health Law, Under Court Order: What the Community 

Integration Mandate Means for People with Mental Illnesses (1999) at 11–12. 

100Id. 

44

� Fund self-advocacy and add self-advocacy organizations to the “Big 3” 

[Administration on Developmental Disabilities] programs [the University 

Affiliated Programs, the Protection and Advocacy systems, and the 

Developmental Disabilities Planning Councils] 

� Get rid of red tape; change Medical Assistance (MA) rules and guidelines 


� Pass MiCASSA


� Make self-determination federal law 


� Set aside Section 8 vouchers for people who are ready to leave nursing homes


� Tie a rent subsidy program to persons leaving institutions


� Shift Section 811, which traditionally has been a project-based funding source, to


individual vouchers 

� Assist people to live in homes with support staff 

� Stop putting money into institutions and instead put it into housing. 

� Provide essential therapies and communication 

� Change professional and bureaucratic attitudes 

� Provide more direct information sessions for people with disabilities to learn their 

rights 

� Train people in institutions to learn how to live in the community; have “buddy 

systems” 

� Provide more home-based programs 

� Provide vouchers for homeownership 

� Provide peer support 

� Have flexible emergency response systems 

� Provide vouchers for homeownership 

� Provide better salaries for personal assistance providers 

� Eliminate programs’ institutional bias 

� Provide more supported-living apartments 

� Have better pay for front-line staff 

45

� Have mandatory training for staff to overcome the outdated attitude that “I’m here 

to take care of you” 

� Have more flexibility with waivers 

� Provide equitable support for people with disabilities entering the workforce 

� Allow people to earn higher wages without influencing benefits 

� Give money to people and allow them to use it for support from family and 

friends, not agencies 

� Provide education to communities that it is okay to be different 

Our respondents’ emphasis on flexible funding and on self-determination, choice, and control 

over how service dollars are spent are reflected in service models based on self-determination, 

consumer direction, and direct control of service dollars. These models are not necessarily 

new-the Centers for Independent Living (CILs) and the mental health consumer/survivors’ 

self-help movement have been providing consumer-controlled services for the past two decades. 

Indeed, most of these service models are strongly supported by scientific studies of their 

outcomes for consumers. 

(b) Consumer-Directed Personal Assistance Services 

Most personal assistance services provided through publicly funded programs have been provided 

through private service provider agencies. The “agency model” has the following features: (1) care 

delivered through a provider agency by caregivers who are supervised by medical professionals; (2) 

case management to coordinate services; and (3) public regulation of providers to ensure quality. 

Case managers or other professional staff members of the agency make important service delivery 

decisions.101 Thus, agency-delivered services tend to diminish, rather than enhance, control by 

101A.I. Batavia, “A Right to Personal Assistance Services: ‘Most Integrated Setting 

Appropriate’ Requirements and the Independent Living Model of Long-Term Care,” 27 Am. J. L. 

& Med. 17, 18 (2001). 

46

disabled individuals over their lives. Yet there is evidence that being able to make personal choices 

regarding one’s own life promotes health, well-being, and personal satisfaction.102 The success of 

consumer-directed personal assistance services, which place decisions about service delivery 

squarely in the hands of the consumer, is therefore not surprising.

103 

Consumer-directed programs permit consumers to have a direct employer-employee relationship 

with their personal assistants. Health care professionals do not supervise the assistants. The 

consumer advertises for assistants and interviews, hires, trains, supervises, and, if necessary, fires 

them.

104 

Many variations on this concept can be funded under existing Medicaid law and regulations.105 

The California In-Home Supportive Services (IHSS) program, which serves more than 200,000 

consumers, of whom about half are 65 and older, is the largest and oldest consumer-directed care 

program in the United States. The program allows payments to a wide range of caregivers, 

including family and agency-managed caregivers. An evaluation of the IHSS program in the late 

1990s showed that the consumers in the program who selected consumer-directed services had 

102M. Kapp, Health Care in the Marketplace: Implications for Decisionally Impaired 

Consumers and their Surrogates and Advocates, 24 S. Ill. U. Law J. 28 (1999); J. MattsonPrince, A Rational Approach To Long-Term Care: Comparing The Independent Living Model 

With Agency-Based Care For Persons With High Spinal Cord Injuries, Spinal Cord 326, 330 

(1997); M. A. Nosek, Personal Assistance: Its Effect on the Long-term Health of a 

Rehabilitation Hospital Population, 74 Arch. Phys. Med. Rehab. 127, 130 (1993). 

103See, e.g., P. Doty et al., “Consumer-Directed Models of Personal Care: Lessons from 

Medicaid,” 74 Milbank Q. 377, 395 (1996). 

104A.I. Batavia, “A Right to Personal Assistance Services: ‘Most Integrated Setting 

Appropriate’ Requirements and the Independent Living Model of Long-Term Care,” 27 Am. J. L. 

& Med. 17, 18–19 (2001). 

105Fox-Grage et al., “Community-Based Long-Term Care” (National Conference of State 

Legislatures Promising Practices Issue Brief, 2000). 

47

significantly greater levels of disability than the consumers who selected provider or 

agency-managed services. The consumer-directed model yielded superior results in satisfaction 

with services, empowerment, and quality of life. Yet the consumer-directed model was 

significantly more cost-effective than the agency-managed model, costing about 50 percent less 

for persons with similar disabilities. No evidence was found that consumer-directed services 

were less safe than agency-managed services. The survey gave no support to the view that 

consumer-directed services should be limited to those consumers, primarily younger adults, who 

are considered capable of hiring, firing, and giving direction to their personal assistants.106 

Demonstration programs supported by HHS under Section 1115 research and demonstration 

waivers take the concept further by placing cash to pay for services directly into the hands of 

consumers. For example, the Cash and Counseling Demonstration cosponsored by The Robert 

Wood Johnson Foundation and HHS provides consumers with a monthly allowance or budget 

based on what Medicaid otherwise would have paid to the beneficiary’s regular service 

providers. Participants in the program develop their own care plans and may spend their 

allowances as they choose, as long as the services they purchase are related to their needs. The 

“counseling” part of the program provides counselors to explain tax, labor, and other rules and 

help consumers with paperwork.107 Each participant in the program receives a cash allowance 

based on the number of hours of personal assistance services required and the number of hours of 

services actually delivered. Program participants can hire family, friends, professionals, or 

neighbors as personal assistants.108 

106L. Polivka and J. Salmon, The Ethical and Empirical Basis for Consumer-Directed 

Care for the Frail Elderly: A Guide to State Policy Makers (Florida Policy Exchange on Aging, 

2000). 

107Fox-Grage et al., “Community-Based Long-Term Care” (National Conference of State 

Legislatures Promising Practices Issue Brief, 2000) at 6. 

108Fox-Grage et al., “Community-Based Long-Term Care” (National Conference of State 

Legislatures Promising Practices Issue Brief, 2000) at 6. 

48

Arkansas is providing cash allowances and counseling to 2,242 persons under a demonstration 

waiver. People who are eligible for Title XIX personal care services are randomly assigned to a 

treatment group and a control group. The control group receives personal care through a provider 

agency; the treatment group receives a monthly cash allowance and services to help them use the 

allowance. Persons with cognitive impairments are eligible for the program. Early data indicate 

the treatment group participants have less nursing home use than the control group. At the 

beginning of the program, the state conducted systematic outreach to eligible persons, including a 

letter from the governor to all persons receiving personal care.109 Similar programs have been 

initiated by Florida for 2,847 persons, including 1,000 children,110 and by New Jersey.

111 

In a similar program in Oregon, the state agency deposits money electronically in the 

participant’s bank account every month. The monthly allocation is based on an assessment of the 

person’s functional status. CILs and Senior Services Centers provide training and technical 

assistance to participants. To conduct payroll tasks, either the participant or a designated 

surrogate must pass an exam. If the person or surrogate does not pass the exam, a fiscal 

intermediary is assigned to conduct payroll functions.112 

Initial research on cash and counseling programs demonstrates a high level of satisfaction with 

cash and counseling programs. More than 80 percent of the participants in programs that have 

been evaluated reported that their quality of life had improved, whereas none considered that it 

109Independent Choices—the Arkansas Cash and Counseling Demonstration, http://www 

hcbs.org/promising_practices.htm/AR_CashAllowance.ref.pdf. 

110http://www.hcbs.org/promising_practices.htm/FL_CashAllowance.ref.pdf. 

111http://www. hcbs.org/promising_practices.htm/NJ_CashAllowance.ref.pdf. 

112http://www.cms.hhs.gov/medicaid/promisingpractices/orca.pdf. 

49

had diminished. Satisfaction with the availability and flexibility of assistance was extremely high 

(95%).113 

(c) Centers for Independent Living 

The CILs, funded under Title VII, Part C, of the Rehabilitation Act of 1973, as amended, have 

been highly successful in assisting persons with significant physical disabilities to leave nursing 

facilities and in diverting nursing facility admissions. The National Council on Independent 

Living (NCIL) claims that in 1999, the most recent year for which figures are available, the CILs 

assisted 2,300 persons with disabilities to leave nursing facilities and kept almost 15,000 from 

being forced into nursing facilities, for an average cost of $643 per person in federal dollars. 

However, funding for the CILs grew by only $10 million in FY 2001.114 

(d) Consumer-Controlled Agency Models 

Advocates for persons with physical disabilities recognize that a consumer-controlled agency 

model is an appropriate choice for some consumers who may prefer to work with an agency that 

handles the administrative work of providing home and community support services. In the 

consumer-controlled agency model, the consumer would exercise maximum control over 

selecting, managing, and dismissing attendants, although in most cases the attendants would be 

employed by the agency and the agency would provide a pool of attendants from whom the 

consumer could select. The consumer could, if desired, become his or her own fiscal agent. 

Although the agency might determine the number of hours of service a consumer would receive 

on the basis of a functional assessment, the consumer would decide when, where, how, and at 

113Fox-Grage et al., “Community-Based Long-Term Care” (National Conference of State 

Legislatures Promising Practices Issue Brief, 2000) at 6. 

114Testimony of Marcie Roth, NCIL, National Listening Session, PM testimony at 

180–81. 

50

what times the services would be delivered. Services would include nonmedical support in 

instrumental activities of daily living. Unlicensed attendants would be allowed to perform healthrelated tasks through delegation or assignment. Training on attendant management would be 

available to consumers who desire it. Services would be available to those who can pay privately, 

those who can pay for some of the costs, and those whose incomes do not allow them to pay the 

costs at all.

115 

(e) Family Support 

Family support is a familiar concept from developmental disabilities services, where experience 

has shown that modest, inexpensive home-based support services can enable people with 

significant disabilities to live at home with their families and avoid placement in an institution or 

group home. Some family support programs, such as those in Michigan, pay a monthly stipend to 

the family to spend as it chooses. These programs have been effective and are highly valued by 

families. Similarly, modest support services, such as respite care, support groups, training, 

education, and help in accessing existing community services can significantly enhance the 

ability of families to continue to care for elderly relatives at home and lessen the time spent in 

more expensive residential services, such as nursing facilities.116 

(f) Consumer-Operated Programs 

A list of essential community services for people with mental illnesses developed by the Surgeon 

General in 1999 includes the following: 

115 See e.g., B. Kafka, “Home Care and the Disability Community,” Caring (July, 

1998) at 28. 

116Testimony of Janet Saynor, former Commissioner of Aging, City of New York, 

National Listening Session, PM testimony at 186–87. 

51

� Case management


� Assertive community treatment


� Psychosocial rehabilitation services


� Community alternatives for crisis care


� Services for co-occurring substance abuse and serious mental illness


� Consumer self-help, consumer-operated programs, consumer advocacy


� Family self-help and advocacy


� Housing


� Income, education, and employment


� Health care


� Integrated service systems

117 

Mental health consumers have emphasized the benefits of consumer-directed initiatives. The 

National Summit of Mental Health Consumers and Survivors held in Portland, Oregon, in 

August 1999 identified a number of alternatives to traditional mental health services whose 

common characteristic is that they are consumer-operated and -directed and provide peer-to-peer 

support. Those services include the following: 

� Peer counseling 

� Employment assistance 

� Drop-in centers 

� Wilderness camping 

� Housing assistance 

� Holistic and herbal medicine 

� Spirituality 

117Bianco et al., Overcoming Barriers to Community Integration for Persons with Mental 

Illness (SAMHSA, 2001) at ii. 

52

The group agreed that the function of these services is “to provide inspiration, hope, and personal 

experience to peers, provide education and training, and an array of consumer-run services in 

safe, coercion-free environments, as an integral part of a full system of resources.”118 The group 

recommended that the program and staff certification and credentialing standards for these 

programs should be designed by consumers for consumers on the basis of their unique 

experience, knowledge, and research and integrated into the publicly funded system of 

services.119 Participants in the summit agreed emphatically that forced treatment, including 

involuntary outpatient treatment, is ineffective, drives people away from voluntary treatment, and 

would not be necessary if there were appropriate community services available.120 

The principles of service articulated by the National Summit echo the principles outlined 

in a 1992 report of the Federal Task Force on Homelessness and Severe Mental Illness and are 

based on research and practice: 

� Access, empowerment, and responsibility. Mental health consumers should be 

empowered to gain access to mainstream resources, and their dignity must be 

respected. 

� Diversity and flexibility. Services should be culturally competent, individualized, 

and sufficiently flexible to respond to changing needs and preferences. 

� Peer, family, and natural supports. Consumers and their allies must engage in 

planning, delivery, monitoring, and evaluation of services. 

� Local, state, and federal participation. Services should be organized locally but 

118“Report From the Alternative Services Plank,” National Summit of Mental Health 

Consumers and Survivors (August 16-29, 1999) at 1–2. 

119Id. 

120“Report from Force and Coercion Plank,” National Summit of Mental Health 

Consumers and Survivors (August 26–29, 1999) at 1. 

53

coordinated at the state level and supported with leadership and appropriate fiscal 

incentives at the federal level.121 

The effectiveness of consumer-directed initiatives at reducing hospitalization of persons with 

mental illnesses is strongly supported by a small but growing body of research. For example, a 

large-scale multimethod study of Consumer/Survivor Development Initiative (CSDI) projects in 

Canada in 1995 found that average inpatient use declined from 48 days to four days. Admissions 

to hospitals for psychiatric treatment dropped from a mean of three admissions to a mean of 0.6 

admissions. Another Canadian study published in 1995 found that nearly 60 percent of the 

participants in a self-help group had not been rehospitalized and that those who had experienced 

a significant reduction in hospital days. A much earlier study in New York in 1984 found that 

persons discharged from psychiatric hospitals who were randomly assigned to participate in a 

self-help program required half as much rehospitalization 10 months after discharge as a 

comparable group who did not participate in the self-help program.122 

Drop-in centers are one of the most widespread service models created by the mental health 

consumer movement. The drop-in center was conceived as a way to meet the need for a safe 

place for people moving from state mental health institutions to find companionship, feel 

welcome, and gain acceptance. Staffed entirely by consumers, drop-in centers may provide 

advocacy-training, skills training, and information about housing, benefits, and other issues of 

interest to consumers as well as social programs. Drop-in centers, such as the program operated 

by AD Lib Inc., an Independent Living Center in Pittsfield, Massachusetts, have developed into 

121Bianco et al., Overcoming Barriers to Community Integration for Persons with Mental 

Illness (SAMHSA, 2001) at 12. 

122Federal/Provincial/Territorial Advisory Network on Mental Health, Review of Best 

Practice in Mental Health Reform (1997) at 77–79. 

54

true cross-disability programs whose members include persons with physical disabilities, 

psychiatric disabilities, retardation, chemical dependency, and learning disabilities.123 

(g) Self-determination 

Self-determination is a model in which persons with disabilities and a circle of support control 

the funds that pay for their own services, either directly or through a fiscal intermediary. The use 

of fiscal intermediaries allows self-determination programs to use Medicaid funding without a 

research and demonstration waiver. Self-determination, a term that originated in the 

developmental disabilities service system in Monadnock, New Hampshire in the early 1990s, was 

an effort to answer the question, “How would a system of supports look if people with 

disabilities and their circle of friends, or network, were truly in charge of their own services, if 

they achieved self- determination?”124 The Monadnock model, which has been replicated in many 

states under the National Self-Determination Initiative supported by The Robert Wood Johnson 

Foundation, is based on four fundamental principles: 

Freedom: The ability for individuals with freely chosen family and/or friends to plan a life with 

necessary support rather than to purchase a program; 

Authority: The ability for a person with a disability (with a social support network or circle if 

needed) to control a certain sum of dollars in order to purchase these supports; 

123“Changing Attitudes of People with Chronic Mental Illness,” in B. O’Day, Issues in 

Rural Independence: Revisited (2001) at 5. 

124 T. Nerney et al., An Affirmation of Community: A Revolution of Vision and Goals. 

Creating a Community to Support All People Including Those With Disabilities. Durham, NH: 

University of New Hampshire Institute on Disability 5 (1995). 

55

Support: The arranging of resources and personnel—both formal and informal—that will assist 

an individual with a disability to live a life in the community rich in community association and 

contribution; and 

Responsibility: The acceptance of a valued role in a person’s community through competitive 

employment, organizational affiliations, spiritual development, and general caring for others in 

the community, as well as accountability for spending public dollars in ways that is life 

enhancing for persons with disabilities.125 

Evaluations of self-determination programs, including the evaluation of the original Monadnock 

project, have been highly positive. The persons supported in the program experienced significant 

gains in self-determination, quality of life, personal satisfaction, improvement in challenging 

behavior and vocational behavior, and individualized practices in the home.126 

(h) Supported Employment 

Successful employment programs combine education, rapid placement in a real job setting 

(“place, then train”), strong support from a job coach or other employment specialist to adapt to 

and sustain the job, and support on and off the job from friends, peers, and coworkers.127 

125 T. Nerney and D. Shumway, (1996). Beyond Managed Care: Self-Determination for 

People with Disabilities, at 4–5 (University of New Hampshire, Institute on Disabilities, 

Durham, NH, 1996). 

126 J. Conroy and A. Yuskauskas, Independent Evaluation of the Monadnock SelfDetermination Project (1997). 

127Bianco et al., Overcoming Barriers to Community Integration for Persons with Mental 

Illness (SAMHSA, 2001) at 38. 

56

Research has shown improved vocational outcomes from supported employment to people with 

significant disabilities who traditionally have not worked in real jobs.128 

Innovative approaches to the employment of persons with mental illnesses include New York’s 

practice of making available, through a request for proposals process, a portion of the savings 

from discharging persons from psychiatric institutions to the counties. Counties have responded 

by creating employment programs, including supported employment and clubhouse models. In 

Florida, a consortium of behavioral health provides job training, placement, and postemployment support with a combination of mental health and labor department funds.129 

(i) Intensive Case Management 

Research suggests that intensive case management, including the programs known as Assertive 

Community Treatment (ACT) and Assertive Case Management (ACM),130 is consistently 

superior to traditional case management in reducing inpatient stays among persons with serious 

128A.F. Lehman and D.M. Steinwachs, “The Schizophrenia Patient Outcomes Research 

Team (PORT) Treatment Recommendations,” http://www.ahcpr.gov/clinic/schzrec1.htm, 

Recommendation 28; Conroy, The Hissom Outcomes Study. 

129Bianco et al., Overcoming Barriers to Community Integration for Persons with Mental 

Illness (SAMHSA, 2001) at 39. 

130In 1999, Sally Richardson, the director of Medicaid services for HCFA, issued a letter 

to State Medicaid Directors informing them that ACT and ACM can be supported under existing 

Medicaid rules. Richardson emphasized that “consumer participation in program design and the 

development of operational policies is especially key in the successful implementation of ACT 

programs.” As of 1999, 33 states provided ACT programs. It is unknown how many of those 

programs were developed with consumer participation. Bazelon Center for Mental Health Law, 

Under Court Order: What the Community Integration Mandate Means for People with Mental 

Illnesses (1999) at 7. 

57

mental illness.131 Indeed, the evidence of outcomes of traditional case management, in which the 

case manager assesses needs and deficits and refers the person to services, has been so negative 

that the model is not recommended as “best practice.”132 Intensive case management combines 

high frequency of contact, small caseloads, proactive outreach to consumers, 24-hour availability, 

and supporting consumers where they live rather than in an office-based practice. ACT, a 

descendent of the Training in Community Living model developed by Leonard Stein in Madison, 

Wisconsin, in the 1970s provides all these features of intensive case management along with a 

multidisciplinary team approach in which case management is provided by teams of psychiatrists, 

social workers, nurses, vocational specialists, and other professionals. 

Research has shown that intensive case management methods are effective in reducing 

hospitalization and achieving cost savings, even taking into account the cost of intensive case 

management and reduced caseloads. For example, a 1993 longitudinal study that tracked people 

who had been discharged from a state hospital and received ACT using a team approach found a 

28 percent decrease in hospital bed days used by the participants by the third year of the study 

and an “impressive” cost savings for the target area. A 1993 study of the results of an ACT 

program developed for consumers in a rural community found significant reduction in hospital 

admissions and length of hospital stay and a 52 percent reduction in the annual cost per person, 

taking into account the costs of hospitalization, the costs of traditional services, and the costs of 

the ACT program. Using a powerful research design, a Canadian study in 1996 found more 

striking results. In that study, all persons referred to a psychiatric hospital during a 12-month 

period were randomly assigned either to an assertive community rehabilitation program using a 

team approach modeled on ACT or to a hospital-based case management program. The mean 

131A.F. Lehman and D.M. Steinwachs, “The Schizophrenia Patient Outcomes Research 

Team (PORT) Treatment Recommendations,” http://www.ahcpr.gov/clinic/schzrec1.htm, 

Recommendation 29. 

132Federal/Provincial/Territorial Advisory Network on Mental Health, Review of Best 

Practice in Mental Health Reform (1997) at 4. 

58

number of hospital days for the experimental group was 39 compared to 256 for the control 

group. In each month of the study, more and more of the consumers in the treatment group were 

living in the community, and they scored higher on objective measures of quality of life.

133 

Mental health consumers advocate strongly that using ACT and Program of Assertive 

Community Treatment (PACT) services to force consumers into involuntary outpatient treatment 

should never be done, because forced treatment is ineffective, drives people away from voluntary 

treatment, and would not be necessary if there were appropriate community services available.134 

It is possible, and certainly preferable, to provide the benefits of ACT on a voluntary basis. 

(j) MiCASSA 

The Medicaid Community-based Attendant Services and Supports Act (MiCASSA), introduced 

but not yet enacted in the past several Congresses and supported overwhelmingly by the 

disability rights movement, is important to note here because it would end the institutional bias 

of Title XIX by allowing individuals eligible for nursing facility or ICF/MR services the election 

to receive community-based attendant services and support. Services covered by the Act would 

include assistance with activities of daily living, including personal care, household chores, 

shopping, managing finances, using the telephone, participating in community activities, 

supervision, and teaching community living skills. MiCASSA services would require the 

following: 

� They would be provided in the most integrated setting appropriate to the needs of 

the individual. 

133Federal/Provincial/Territorial Advisory Network on Mental Health, Review of Best 

Practice in Mental Health Reform (1997) at 7. 

134“Report from Force and Coercion Plank,” National Summit of Mental Health 

Consumers and Survivors (August 26–29, 1999) at 1. 

59

� They would be based on functional need, rather than diagnosis or age. 

� They would be provided in home or community settings, including school, work, 

recreation, or religious settings. 

� They would be selected, managed, and controlled by the consumer of the services. 

� They would be supplemented with backup and emergency attendant services. 

� They would be furnished according to a service plan agreed to by the consumer. 

� They would be accompanied by voluntary training on selecting, managing, and 

dismissing attendants. 

MiCASSA would allow consumers to choose among various consumer-controlled service 

delivery models, including vouchers, direct cash payments, fiscal agents, and agency providers. 

A person unable to direct his or her own care may be assisted by an authorized representative. 

The bill would also cover transition costs from a nursing facility or ICF/MR to a home setting; 

for example, it would cover rent and utility deposits, bedding, basic kitchen supplies, and other 

necessities and would allow an enhanced federal match of up to 90 percent for persons whose 

costs exceed 150 percent of average nursing home costs.135 The IMD exclusion would not create 

a barrier to eligibility for persons with mental illnesses. 

135From summary developed by ADAPT, http://www.adapt.org/casa/summary.htm. 

60

II. 

The Olmstead Decision 

In Olmstead v. L.C.,136 the U.S. Supreme Court, in interpreting the ADA137 and its implementing 

regulation 28 C.F.R. § 41.51(d),138 held that “[u]njustified isolation ... is properly regarded as 

discrimination based on disability.”139 The logical consequence, the Court held, is that in 

appropriate circumstances, “proscription of discrimination may require placement of persons 

with mental disabilities in community settings rather than institutions.”140 Those circumstances 

exist, the Court further held, when the institutionalized person is “qualified” to live in a 

community setting “with or without reasonable modifications” to the government entity’s rules, 

policies, or practices.”141 

Olmstead v. L.C. was brought in U.S. District Court in Georgia on May 11, 1995, by Lois 

Curtis,142 a woman with disabilities who was institutionalized at Georgia Regional Hospital at 

136527 U.S. 581 (1999). 

13742 U.S.C. § 12132. 

13828 C.F.R. § 35.130(d). 

139527 U.S. at 597. 

140527 U.S. at 587. 

141527 U.S. at 602, quoting 42 U.S.C. 12131(2), which defines “qualified individuals with 

a disability” as persons with disabilities who “with or without reasonable modifications to rules, 

policies, or practices, ... meet the essential eligibility requirements for the receipt of services or 

the participation in programs or activities provided by a public entity.” 

142Although the plaintiffs’ initials were used throughout the court proceedings and 

appeals, they have chosen to use their full names in the coverage of the case in the media and the 

disability rights movement. See, e.g., Freedom Clearinghouse, “Lois Curtis, Elaine Wilson: Faces 

of Freedom,” http://www.freedomclearinghouse.org; Liberty Resources Advocacy, “Integration 

Not Segregation Means Real Choice,” http://www.libertyresources.org/advocacy/choice.html. 

61

Atlanta (GRH-A), a state mental hospital.

143 Ms. Curtis challenged her continued confinement in 

the institution despite the professional judgment of her psychiatric treatment team that she no 

longer required inpatient treatment but instead needed community residential and habilitation 

services.144 Ms. Curtis alleged violations of her rights under the Due Process clause of the 

Fourteenth Amendment and Title II of the ADA.145 She sought declaratory relief and an 

injunction releasing her from GRH-A and providing her with appropriate treatment by qualified 

professionals.146 A consent order entered in July 1995 discharged Ms. Curtis to a state institution 

for persons with retardation, from which she was discharged in February 1996 to a community 

support program known as “Nyasha Hands.” However, the transfer did not resolve the case 

because Ms. Curtis contended that she was not receiving appropriate services to support her in 

the community.

147 Meanwhile, Elaine Wilson, who was also confined at GRH-A and whose 

claims were similar to those raised by Ms. Curtis, was granted leave to intervene in the case.

148 

Both plaintiffs and defendants filed motions for summary judgment, asking the court to decide 

the case on the uncontested facts.149 

143L.C. by Zimring v. Olmstead, 1997 U.S. Dist. LEXIS 3540 (N.D. Ga. 1997). 

1441997 U.S. Dist. LEXIS 3540 *3. 

145Id. *3. 

146Id. 

1471997 U.S. Dist. LEXIS 3540 *3–4. Due to a funding problem, Ms. Curtis did not 

receive the services that were to be provided in the community setting for several months. 

However, this was evidently resolved by the time the district court decided the case. 1997 U.S. 

Dist. LEXIS 3540 *7. 

148Both Ms. Curtis and Ms. Wilson have retardation and mental health diagnoses. 1997 

U.S. Dist. LEXIS 3540 *2–4. 

1491997 U.S. Dist. LEXIS 3540 *4. Ms. Wilson also asked for a preliminary injunction, 

but the Court deferred ruling on this motion until after the motions for summary judgment were 

decided. 

62

The defendants claimed that Ms. Curtis’ claims were moot because she was already receiving 

services in a community setting. They argued that they had not violated Ms. Wilson’s rights 

because she was denied community placement because of inadequate funding, not because of 

discrimination based on her disability. They further argued that they had not violated Ms. 

Wilson’s rights under the Due Process clause because the decision to treat her at GRH-A was 

based on the exercise of professional judgment.150 

The district court held, first, that Ms. Curtis’ claims were not moot, although she was now 

receiving the services she sought in the community, because her claims were “capable of 

repetition, yet evading review.”151 The court therefore reached the merits of both plaintiffs’ 

claims. 

Reciting the familiar standard for proving discrimination under the ADA, the district court stated 

that to prove a violation of Title II of the Act, the plaintiffs must show (1) that they are “qualified 

individual[s] with a disability”; (2) that they were excluded from participation in or denied the 

benefits of a public entity’s services or programs or were otherwise discriminated against; and 

(3) that such discrimination was “by reason of” their disability.

152 Applying the standard, the 

court found that “there is no dispute that plaintiffs are qualified individuals with a disability” and 

that they could be placed in the community. The defendants disputed whether Ms. Wilson should 

live in the community, but the court held that “the qualified experts [were] unanimous” in their 

opinion that she could.153 

1501997 U.S. Dist. LEXIS 3540 *5. 

1511997 U.S. Dist. LEXIS 3540 *7, citing Sultenfuss v. Snow, 35 F.3d 1494, 1498 n. 5 

(11th Cir. 1994) and Vitek v. Jones, 445 U.S. 480, 487 (1980). 

1521997 U.S. Dist. LEXIS 3540 *8, citing Concerned Parents to Save Dreher Park Center 

v. City of West Palm Beach, 846 F.Supp. 986, 990 (S.D. Fla. 1994). 

153Id. 

63

The defendants next argued that the two women were denied community services because of 

inadequate funding and therefore that the plaintiffs had failed to prove that they had been 

discriminated against by reason of their disability. The court rejected this contention and held 

that “under the ADA, unnecessary institutional segregation of the disabled constitutes 

discrimination per se, which cannot be justified by a lack of funding.”154 

The district court based its holding on an analysis of the text of the statute, its legislative history, 

and the Title II regulation promulgated by the U.S. Attorney General. The court found that the 

statute made clear, in 42 U.S.C. § 12101(a)(2), (3), and (5), that “segregation” of persons with 

disabilities is a form of discrimination that Congress intended to eliminate.

155 The court also 

found that the legislative history of the ADA is “replete” with statements reflecting Congress’ 

intent to prohibit unnecessary segregation.156 Finally, the court held that the Title II regulation 

stating “a public entity shall administer services, programs, and activities in the most integrated 

setting appropriate to the needs of qualified individuals with disabilities” “plainly” prohibits 

discrimination.157 The court also noted that the regulation requires public entities to make 

reasonable modifications in existing programs to avoid discrimination: “A public entity shall 

make reasonable modifications in policies, practices, or procedures when the modifications are 

necessary to avoid discrimination on the basis of disability, unless the public entity can 

1541997 U.S. Dist. LEXIS 3540 *9. 

155Id. The Preamble to the ADA states, “The Congress finds that historically, society has 

tended to isolate and segregate individuals with disabilities, and, despite some improvements, 

such forms of discrimination against individuals with disabilities continue to be serious and 

pervasive social problems.” 

156Id., citing, as an example, 135 Cong. Rec. 19803 (statement of Senator Harkin, floor 

manager for the ADA). 

157Id., quoting 28 C.F.R. § 35.130(d). The court noted that the Appendix to the Title II 

regulation explains that “the most integrated setting appropriate” is “a setting that enables 

individuals with disabilities to interact with non-disabled persons to the fullest extent possible.” 

28 C.F.R. Pt. 35, App. A. 

64

demonstrate that making the modifications would fundamentally alter the nature of the service, 

program, or activity.”158 

Although the defendants claimed that all available funds were being used to provide services to 

other persons with disabilities, the district court held that it would not “fundamentally alter” the 

defendants’ services. The court based its holding on the following factors: First, the defendants 

had existing programs that provided services to persons like the plaintiffs. Second, it was 

undisputed that the defendants could provide services to the plaintiffs at “considerably less cost” 

than in the institution.159 The court granted summary judgment for the plaintiffs—including a 

declaratory relief—and ordered the defendants to place Elaine Wilson in the community and 

provide Lois Curtis with “all appropriate services necessary” to maintain her placement in the 

community.

160 

On appeal, the Court of Appeals for the Eleventh Circuit affirmed161 the district court’s judgment 

that the defendants had discriminated against the plaintiffs “by confining them in a segregated 

institution rather than an integrated community-based program.” However, the court of appeals 

remanded the case to the district court for further findings concerning the state’s defense that 

providing community services to the plaintiffs would “fundamentally alter” the nature of the 

states’ services.162 

158Id., quoting 28 C.F.R. § 35.130(b). 

1591997 U.S. Dist. LEXIS 3540 *12. 

1601997 U.S. Dist. LEXIS 3540 *12–13. The court denied as moot the plaintiffs’ 

remaining claims under the Fourteenth Amendment. 

161L.C. by Zimring v. Olmstead, 138 F.3d 893 (11th Cir. 1998). 

162138 F.3d at 895. The court of appeals also affirmed that neither plaintiff’s claim was 

moot, noting that Ms. Curtis’ community placement had been unstable at times and therefore the 

case was capable of repetition yet evading review. Id. 

65

As it had in the district court, the state contended that the plaintiffs had not been denied 

community placement because of their disability. The state argued that the ADA requires a 

comparison of its treatment of persons with disabilities as against that of persons without 

disabilities and that Ms. Curtis and Ms. Wilson had not shown that they had been denied 

community services that were available to persons without disabilities. In short, the state argued, 

“Title II of the ADA affords protection to individuals with disabilities who receive public 

services designed only for individuals with disabilities.”163 

The court rejected this argument summarily. First, the court reasoned that the state had to 

concede that the plaintiffs were confined at GRH-A because of their disabilities. Second, the 

court reasoned that the state had pointed to no legal authority that supported its reading of Title 

II; rather, the overwhelming authority in “the plain language of Title II of the ADA, its legislative 

history, the Attorney General’s Title II regulations, and the Justice Department’s consistent 

interpretation of those regulations” supported Ms. Curtis’ and Ms. Wilson’s position.164 

The court of appeals considered first the proper interpretation of the regulations promulgated by 

the Attorney General to implement Title II of the ADA and noted that because Congress 

entrusted this task to the Attorney General and directed him to define the discrimination 

prohibited by Title II, the regulation must be “given controlling weight unless they are arbitrary, 

capricious, or manifestly contrary to the statute.”165 Not only does the regulation require that 

services be administered in the most integrated setting but also the Attorney General had 

consistently adopted the interpretation that the most integrated setting was one that “enables 

individuals with disabilities to interact with non-disabled persons to the fullest extent possible,” 

163138 F.3d at 896. 

164Id. 

165Id., citing Chevron, U.S.A., Inc. v. NRDC, Inc., 467 U.S. 837, 844 (1984) and other 

authority. 

66

both in the Appendix to the regulation itself and in the decision to “participat[e] in this and 

similar litigation.”166 Thus, the court held, institutional confinement of a person with disabilities 

who can live in the community violated “the core principle underlying the ADA’s integration 

mandate” because the opportunity to interact with nondisabled persons is present in only limited 

circumstances in a state institution, such as GRH-A. 

Having found that the district court had properly interpreted the regulation, the court of appeals 

then considered the validity of the regulation, that is, whether the integration regulation was 

“manifestly contrary” to the statute. The court found that it was fully consistent with the statute 

because, in enacting the ADA, Congress had directed the Attorney General to promulgate 

regulations consistent with the coordination regulations promulgated to implement Section 504 

of the Rehabilitation Act of 1973,167 which contain an integration mandate essentially identical to 

the language of 28 C.F.R. § 35.130(d). The 504 regulations require recipients of federal funds to 

“administer programs and activities in the most integrated setting appropriate to the needs of 

qualified handicapped persons.”168 In effect, the court of appeals held, Congress “ratified” and 

166138 F.3d at 8897, citing 28 C.F.R. Appendix A at 478. 

167The mandate to promulgate regulations consistent with Section 504, 29 U.S.C. § 794 is 

at 42 U.S.C. § 12134(b). The integration provision of the § 504 coordination regulation is at 28 

C.F.R. § 41.51(d). The court of appeals noted that Congress made a considered choice to require 

consistency with the coordination regulations rather than other 504 regulations that appear to 

require a less demanding standard for including persons with disabilities in the most integrated 

setting. 

168Congress also mandated that the Attorney General promulgate regulations that are 

consistent with other titles of the ADA, and the integration regulation of Title II is completely 

consistent with the provisions of Title III of the ADA, 42 U.S.C. § 12182(b)(1)(B), which 

requires places of public accommodation to provide goods and services to persons with 

disabilities “in the most integrated setting appropriate to the needs of the individual.” 

67

voiced its approval of the Section 504 coordination regulations, and this ratification was 

therefore binding on the court.169 

Like the district court, the court of appeals held that the regulation’s consistency with the statute 

was demonstrated by the plain language of the Congressional findings and by the ADA’s 

legislative history. Both demonstrate that “Congress ought to eliminate the segregation of 

individuals with disabilities in passing the ADA.”170 

The court rejected the state’s argument that the plaintiffs were not discriminated against “by 

reason of [their] disability” because they sought services that were not provided to persons 

without disabilities. “Underlying the ADA’s prohibitions is the notion that individuals with 

disabilities must be accorded reasonable accommodations not offered to other persons in order to 

ensure that individuals with disabilities enjoy ‘equality of opportunity, full participation, 

independent living, and economic self-sufficiency.’”171 Thus, no showing of differential 

treatment is required.172 Indeed, the court found that the state’s “indifference to [the plaintiffs’] 

needs—manifested by their refusal to place them in the community while recognizing the 

propriety of such a placement—is exactly the kind of conduct that the ADA was designed to 

prevent.” Plainly, the ADA was designed to eliminate discrimination against persons with 

disabilities that was “the product, not of invidious animus, but rather of thoughtlessness and 

indifference.”173 Having rejected all the state’s arguments that the plain language of the 

integration regulation need not be followed, the court of appeals held that “[t]he State’s failure to 

169138 F.3d at 898. 

170Id., citing the legislative history extensively. 

171138 F.3d at 899, quoting 42 U.S.C. § 12101(a)(8). 

172138 F.3d at 900. 

173138 F.3d at 901. 

68

place L.C. and E.W. in the community thus falls squarely within the ADA’s ban on disabilitybased discrimination.”174 

Next, the court of appeals considered and rejected the state’s argument that lack of funds is a 

nondiscriminatory reason not to provide services in the most integrated setting. This, the court 

said, would excuse noncompliance with the assertion that the state lacked the money to 

comply.

175 

The court of appeals limited its holding, however, by stating, in dicta, that where the 

“individual’s treating professionals” did not find that a community-based program was 

appropriate, “nothing in the ADA requires the deinstitutionalization of the patient.” The court 

gave no reason why the opinions of the treating professionals, who, in the case of a person 

confined in a state institution, would probably be state employees, should be conclusive. Of 

course, this principle had no application to Lois Curtis or Elaine Wilson because, as the court of 

appeals found when it upheld the district court’s grant of summary judgment on this point, all the 

experts agreed unanimously that they belonged in the community.

176 

The court of appeals departed from the district court in its holding that although lack of funds is 

not a nondiscriminatory reason not to provide community services to a qualified person, lack of 

available funding might nevertheless provide a defense to the plaintiffs’ ADA claims. The court 

found that the district court erred in failing to consider whether providing community services to 

Ms. Curtis and Ms. Wilson would require additional expenditures. The court of appeals held that 

the important consideration was not whether a community program would be more expensive 

than an institutional program, but whether the additional expenditures, if any, required to serve 

174Id. 

175138 F.3d at 902. 

176138 F.3d at 903. 

69

the plaintiffs in the community and still pay its fixed overhead costs at the institution would 

“fundamentally alter the services [the state] provides.”177 Thus, while the district court looked at 

only the comparative cost of each individual’s program in the community and the institution, the 

court of appeals looked at the marginal cost to the state of serving two additional persons in the 

community. The court of appeals also held that the court should consider the “demands” of the 

state’s mental health budget and methods available to the state of reducing the burden to the state 

of the additional marginal cost, such as transferring funds from an institutional budget line to a 

community budget line. The court of appeals remanded the case to the district court to consider 

these factors.178 

The state petitioned for certiorari, which was granted because of the importance of the issues in 

the case “to the states and affected individuals.”179 Shortly thereafter, the district court issued a 

decision concluding that the additional cost to the state of providing community services to the 

two plaintiffs was not unreasonable in relation to the state’s overall mental health budget. The 

state also appealed that holding to the court of appeals.180 

The Supreme Court affirmed that part of the Eleventh Circuit’s decision holding that unnecessary 

segregation is a form of discrimination based on disability that is prohibited by the ADA. 

However, the Court rejected the court of appeals’ interpretation of the state’s “fundamental 

alteration” defense to a claim for community placement. 

177138 F.3d at 905. 

178Id. 

179527 U.S. at 596. 

180527 U.S. at 596 n. 7. 

70

The majority opinion for the Court was delivered by Justice Ginsburg and joined by Justices 

O’Connor, Souter, and Breyer. Justice Stevens joined Parts I, II, and III-A of Justice Ginsburg’s 

opinion, but did not join Part III-B, which sets forth the parameters for the fundamental alteration 

defense. Justice Kennedy concurred only in the judgment and wrote a separate opinion. Justices 

Thomas wrote a dissenting opinion that Justices Scalia and Rehnquist joined. In a part of her 

opinion joined by Justices O’Connor, Souter, and Breyer, but not by Justice Stevens, Justice 

Ginsburg wrote that the court must consider not merely the marginal cost of serving two 

additional persons in the community but also “the range of services the State provides others with 

mental disabilities, and the State’s obligation to mete out those services equitably.”181 Because 

only four Justices signed that part of Justice Ginsburg’s opinion that addresses the fundamental 

alteration defense, it is important to analyze the three concurring opinions to determine what, 

precisely, the Court held concerning that defense. 

Part III-A of the opinion for the Court, joined by five Justices, examined whether “undue 

institutionalization qualifies as discrimination ‘by reason of disability,’” and held that it did. The 

Court’s analysis is similar to that of the Court of Appeals. First, the Court recognized that the 

Department of Justice consistently had advocated, as a litigant and amicus curiae in 

deinstitutionalization cases, that unnecessary institutionalization is discrimination within the 

meaning of the ADA and Section 504.182 Although the Court did not find it necessary to accord 

the views of the Department of Justice the high degree of deference required by Chevron v. 

181527 U.S. 597. Sections I and II of Justice Ginsburg’s opinion summarize the history of 

the case and its statutory and regulatory context. The holding, joined by five Justices, arguably 

the only clear holding of the Court in Olmstead v. L.C., is set forth in Section III-A. 

182527 U.S. at 598. 

71

NRDC,183 it found that it was appropriate to look to the views of the Department of Justice of 

“guidance.”184 

The Court next rejected the contention that “discrimination” requires “uneven treatment of 

similarly situated individuals,” or that the plaintiffs’ claims should be rejected because they had 

identified no “comparison class” of persons receiving differential treatment. In an important 

affirmation of Congress’ intent, the Court stated, “We are satisfied that Congress had a more 

comprehensive view of the concept of discrimination advanced in the ADA.”185 

The Court recognized that the ADA was the culmination of a succession of Acts of Congress that 

were designed “to secure opportunities for people with developmental disabilities to enjoy the 

benefits of community living.”186 In the Congressional findings that accompanied the ADA, 

Congress “explicitly identified unjustified ‘segregation’ of persons with disabilities as a ‘form of 

segregation.’”187 

The Court noted, “Recognition that unjustified institutional isolation of persons with disabilities 

is a form of discrimination reflects two evident judgments.” One is that “institutional placement 

of persons who can handle and benefit from community settings perpetuates unwarranted 

assumptions that persons so isolated are incapable or unworthy of participating in community 

183See supra, n. 30 and accompanying text. 

184527 U.S. at 598. 

185Id. 

186527 U.S. at 599. 

187527 U.S. at 600. The Court reconciled the divergent court opinions interpreting the 

integration language in the Section 504 regulations by noting that Section 504 “contains no 

express recognition that isolation or segregation of persons with disabilities is a form of 

discrimination.” 

72

life.” The second is that “confinement in an institution severely diminishes the everyday life 

activities of individuals, including family relations, social contacts, work options, economic 

independence, educational advancement, and cultural enrichment.”188 In recognizing the 

Congressional judgment that unnecessary segregation is discrimination, the Court acknowledged 

Congress’ authority to make that judgment—a judgment by which courts must abide—and, at the 

same time, affirmed its reasonableness and its grounding in everyday experience. 

The Court next turned to the question of how individuals who are “qualified” for community 

living should be identified. The Court held that both state officials and courts “generally” may 

rely on “the reasonable assessments of its own professionals” when they determine that an 

individual “meets the essential eligibility requirements for a community program.”189 The Court 

was careful not to say, as the court of appeals had, that “nothing in the ADA requires” the state to 

place persons with disabilities in the community in cases in which the state’s own professionals 

have not recommended community placement.

190 Plainly, the Court left open the possibility that 

the assessments of the state’s professionals might not be “reasonable,” that they might not make 

such assessments, and that assessments by state professionals are not the only way for courts to 

determine whether an institutionalized person can meet the essential eligibility requirements for 

community services. 

The Court was equally careful in framing the issue of opposition to placement in the community. 

Noting that there is “no federal requirement that community-based treatment be imposed on 

188527 U.S. at 600–601. The Court also noted that institutional residents with disabilities 

are treated differently from other persons in the sense that, to receive needed services, they must 

“relinquish participation in community life they could enjoy given reasonable accommodations, 

while persons without mental disabilities can receive the medical services they need without 

similar sacrifice.” 527 U.S. at 601. 

189527 U.S. at 602. 

190See supra, n. 41 and accompanying text. 

73

patients who do not desire it,” the Court held that no genuine dispute existed about Lois Curtis’ 

and Elaine Wilson’s eligibility for community services because “the state’s own professionals 

determined that community-based treatment would be appropriate” and “neither woman opposed 

such treatment.”191 The Court did not place the burden on the plaintiffs to affirmatively request 

community placement or show that she or an authorized representative, such as a guardian, had 

consented to it. 

Part III-B of Justice Ginsburg’s opinion, joined by four Justices, rejected the court of appeals’ 

formulation of the fundamental alteration test as the reasonableness of the marginal cost of a 

handful of additional community placements measured against the state’s entire mental health 

budget. Obviously, the marginal cost will be such a small fraction that “it is unlikely that a state 

... could ever prevail” under that test. Justice Ginsburg192 also rejected the cost-comparison test 

employed by the district court and expressed her concern that this would lead to overall increases 

in expenses without enabling the state “‘to take advantage of the savings associated with the 

closure of institutions.’”193 Rather, she stated, “Sensibly construed, the fundamental-alteration 

defense would allow the State to show that, in the allocation of available resources, immediate 

relief for the plaintiffs would be inequitable, given the responsibility the State has undertaken for 

the care and treatment of a large and diverse population of persons with mental disabilities.”194 

Justice Ginsburg then invoked the need to provide “a range of facilities,” citing the need to 

provide a high level of support and supervision for those who need it to avoid improperly 

“dumping” persons with disabilities in homeless shelters and similar inappropriate settings. 

191527 U.S. at 602–603 (emphasis added). 

192Since this part of the opinion was not the opinion for the Court, it will be referred to as 

the opinion of Justice Ginsburg. 

193527 U.S. at 604, quoting Brief for the United States as Amicus Curiae at 21. 

194527 U.S. at 604 (emphasis added). 

74

Justice Ginsburg suggested that states might need to maintain institutions for some persons. But 

she drew a remarkable conclusion from these assumptions: 

To maintain a range of facilities and to administer services with an even hand, the 

State must have more leeway than the courts below understood the fundamentalalteration defense to allow. If, for example, the State were to demonstrate that it 

had a comprehensive, effectively working plan for placing qualified persons with 

mental disabilities in less restrictive settings, and a waiting list that moved at a 

reasonable pace not controlled by the State’s endeavors to keep its institutions 

fully populated, the reasonable-modifications standard would be met.195 

This conclusion is remarkable because it seems based on recognition of the relationship between 

the rights and needs of individuals and the configuration of the state’s service system as a whole. 

Although Justice Ginsburg characterizes her standard as more generous to the state than the court 

of appeals’ standard, in fact, the opposite is probably true under the facts of most 

deinstitutionalization cases. The “marginal cost” calculation invoked by the court of appeals 

would tilt in favor of the state when the number of persons with disabilities seeking community 

placement is large. In contrast, Justice Ginsburg’s standard would not require a “fundamental 

alteration” when large numbers of persons with disabilities are inappropriately placed in 

institutions. In a case in which the evidence shows that the entire population of a state institution 

could be relocated to the community where all institutional residents could receive better services 

at lower cost, it is difficult to see how the state could prove that community placement for all 

residents represented a “fundamental alteration.” 

Justice Stevens wrote separately to state his opinion that the court of appeals “appropriately 

remanded” to the district court for consideration of the state’s fundamental alteration defense and 

that, therefore, the Supreme Court should simply affirm the court of appeals. He noted that the 

district court, on remand, rejected the state’s fundamental alteration defense and stated that if the 

195527 U.S. at 605–606 (emphasis added). 

75

district court were wrong in its conclusion that the state had failed to make out such a defense, 

then that error should be corrected by the court of appeals or the Supreme Court in reviewing that 

decision.196 Justice Stevens did not squarely address the meaning of “fundamental alteration” or 

the standard for determining when a change in configuration of the defendants’ service system 

might constitute a reasonable modification. 

Justice Kennedy also wrote separately and did not join any part of the opinion written by Justice 

Ginsburg. However, he would have remanded the case to the court of appeals or the district court 

“to determine in the first instance whether a statutory violation is sufficiently alleged and 

supported in [the] summary judgment materials and, if not, whether they should be given leave 

dissenters.” Justice Kennedy would have held that discrimination requires “differential treatment 

vis-a-vis members of a different group on the basis of a statutorily described characteristic,” yet 

he considered that such discrimination might be proved in this case by evidence showing that “a 

group of mentally disabled persons” unnecessarily receives “psychiatric or other medical 

services” in an institutional setting when persons with comparable medical problems receive 

similar services in an integrated setting. Like the court of appeals, he would have held the 

“comparative costs of treatment” ought not to be used as the standard for determining “undue 

burden,” but did not go on to state a standard other than the view that “the State is entitled to 

wide discretion in adopting its own systems of cost analysis, and, if it chooses, to allocate health 

care resources based on fixed and overhead costs for whole institutions and programs.”197 

Justices Thomas, Rehnquist, and Scalia dissented on the ground that, in their view, 

“discrimination” could not encompass “disparate treatment among members of the same 

protected class.”198 

196527 U.S. 607, 607–608 (Stevens, J.). 

197527 U.S. 615. 

198527 U.S. 615, 616 (Thomas, J.) (emphasis in original). 

76

Thus, while a clear majority of the Court held that unnecessary institutionalization of persons 

with disabilities represents discrimination and that unnecessarily institutionalized persons with 

disabilities have a right to community placement unless the state can show that community 

placement would represent an undue burden, only four members of the Court could agree on a 

single definition of “fundamental alteration.” At least five members of the Court agreed, 

however, that states do not have discretion to keep persons with disabilities unnecessarily 

institutionalized for unreasonable lengths of time and that the state must at the very least 

maintain a waiting list that moves at a reasonable pace. The concluding statement of Justice 

Ginsburg’s opinion seems to be a fair statement of the principles on which at least five 

Justices agreed: 

States are required to provide community-based treatment for persons with mental 

disabilities when the State’s treatment professionals determine that such 

placement is appropriate, the affected persons do not oppose such treatment, and 

the placement can be reasonably accommodated taking into account the resources 

available to the State and the needs of others with mental disabilities.199 

199547 U.S. at 607. 

77

78

III. 

Case Law Applying and Interpreting Olmstead and Other PostOlmstead Case Law Concerning Rights to Community Services 

1.	 Introduction: The Role of Disability Rights Advocates in Defining the Requirements 

for Effective Olmstead Implementation 

In the plurality opinion in Olmstead v. L.C., the existence of a “comprehensive, effectively 

working plan” that enables waiting lists for community services to move at a reasonable pace is 

framed as a defense to an ADA claim, not as an affirmative obligation on the part of the states. 

However, some disability rights advocates concluded after Olmstead was decided that a plan 

could have value both as an organizing tool and as a device to force states to commit to 

numerical targets, timelines, and allocation of resources. 

One of the earliest responses to Olmstead came from then-HHS Secretary Donna Shalala in a 

speech on July 28, 1999, to the National Conference of State Legislatures. Secretary Shalala 

reminded the Conference that Olmstead requires states “to move at a reasonable pace to provide 

community-based alternatives” and that states can meet this obligation by having comprehensive 

plans. The Secretary offered HHS’ support and technical assistance “[t]o build better systems of 

supports enabling people with disabilities to live life to the fullest.”200 

Just a few days before the Secretary’s speech, at a conference in Bethesda, Maryland, advocates 

took the first steps toward operationalizing the Olmstead comprehensive planning requirement. 

The conference, titled “Personal Assistance Services: A New Millennium,” was held on July 

23–25, 1999, and cosponsored by United Cerebral Palsy, Independent Living Research 

200Remarks by Donna E. Shalala, HHS Secretary, National Conference of State 

Legislatures, Indianapolis, Indiana (July 28, 1999). 

79

Utilization, the National Council on the Aging, ADAPT, and the World Institute on Disability. It 

brought together about 120 disability rights activists, leaders of advocacy organizations, and 

policymakers. A goal of the conference was to create a unified vision for personal assistance 

services across all disability constituencies and to develop action plans to expand and improve 

personal assistance services in the new millennium. The conference’s Litigation Group focused 

its discussion on Olmstead implementation.201 

The members of the Litigation Group concluded that every state should have a comprehensive 

implementation plan and advocates should not wait for HHS to require one. Energized by their 

success in persuading state governors and attorneys general to remove their states’ names from 

an amicus brief in Olmstead v. L.C. in support of the state of Georgia,202 the advocates affirmed 

that the organizing effort showed the value of setting deadlines and set July 26, 2000, as the date 

by which they expected states to have a plan in place. Conference participants agreed to go back 

to their own states, convene the key players (Independent Living Councils, Developmental 

Disabilities Councils, Protection and Advocacy agencies, self-advocacy groups, mental health 

consumer groups, nursing facility family and resident councils, volunteers, and ombudspersons), 

hold an initial meeting by September 1, 1999, and make contact with state Medicaid officials by 

October 1, 1999. The conference participants agreed that the National Association of Protection 

and Advocacy Systems (NAPAS) would draft an outline of the key elements of a state plan that 

would be disseminated widely among advocates around the nation. 

Accordingly, in October 1999, NAPAS published a “Template of Key Elements Which Must be 

Considered When Developing a Comprehensive, Effectively Working State Plan For Moving 

201Research and Training Center on Personal Assistance Services, “Personal Assistance 

Services: A New Millennium,” A Report on the Conference Held July 23–25, 1999. 

202Center for an Accessible Society, “The Supreme Court Upholds ADA “Integration 

Mandate” in Olmstead Decision” (n.d.). http://www.accessiblesociety.org/topics/ada/ 

olmsteadoverview.htm. 

80

People Out of Institutions and Into Appropriate Community Settings.” Reasoning that a 

“comprehensive” plan must be one that addresses the need for community services of all persons 

who are unnecessarily institutionalized or at risk of institutionalization, NAPAS recommended 

the following: 

� States’ planning for Olmstead implementation include all stakeholders. 

� States should assess institutionalized persons’ need for community services. 

� States should develop community services and improve the infrastructure of the 

community system. 

� States should develop transition services. 

� States should develop tracking systems to monitor individual progress. 

� Olmstead implementation plans should contain measurable goals and time frames 

tied to resource allocation. 

� Implementation plans should provide for quality assurance and resource 

development.203 

Similarly, ADAPT integrated Olmstead implementation into its Campaign for Real Choice, a 

systematic advocacy effort to support passage of MiCASSA, and developed a checklist, similar 

to the NAPAS template, against which states’ Olmstead implementation efforts could be 

measured. The following were ADAPT’s conditions: 

� The state should create a “Most Integrated Setting” committee to develop a 

community integration plan to implement the Olmstead decision. The committee 

majority should be people with disabilities and their family members and 

advocates. 

203NAPAS, Template of Key Elements (October 12, 1999). 

81

� The community integration plan should include assurances that all individuals 

applying for support services will receive information on ALL home and 

community services options. 

� A “reasonable pace” should be no longer than 90 days. 

� States should contract with advocacy groups throughout the state to identify all 

individuals who want to get out of nursing homes and other institutions and (1) 

develop information on home and community options, and (2) go into the nursing 

homes and other institutions to inform people of their home and community 

service options. 

� The plan should contain timetables for getting people out; expanding service 

capacity by increasing waivers, Personal Care option, or other programs; 

development of new services, such as Medicaid waivers and Personal Care option. 

� The HCFA and OCR regional managers should ensure that Olmstead 

implementation will occur.204 

Against these standards, advocates scrutinized their own states’ planning processes and found 

them woefully lacking.

205 In addition to advocating with officials in their own states, disability 

204ADAPT, Campaign for Real Choice, Most Integrated Setting, “ADAPT’s Response to 

Olmstead” (n.d.). 

205For example, in September 1999, the Disability Policy Consortium, a coalition of 

disability organizations in Texas, attended the presentation of the Texas Health and Human 

Services Commission’s draft Plan to Expand Opportunities for Texans with Disabilities and 

almost immediately began to negotiate changes in the plan to conform to the requirements of 

Olmstead. The Consortium urged that the plan (1) include people with disabilities residing in all 

institutions, including nursing facilities, state hospitals, and public and private ICF/MR facilities; 

(2) prescribe meaningful identification procedures for people with disabilities in nursing homes 

and private ICF/MR facilities and modify, where necessary, the current identification practices in 

state schools and state hospitals; (3) contain clear timeframes for the community integration of 

people in nursing homes, state hospitals, and public and private ICF/MR facilities; (4) appoint 

people with disabilities, families of people with disabilities, and advocacy organizations to 

positions on an oversight committee whose role would be to ensure that people who want 

82

rights advocates also urged state and federal officials to collaborate with the disability 

community to develop action plans to transition people from institutions to community living.

206 

2. The Federal Response: The HHS Olmstead Policy Letters 

On January 14, 2000, as a result of extensive discussions and meetings among the Secretary of 

HHS, the Director of HHS OCR, and the disability community, HHS issued guidance on 

Olmstead implementation planning that was remarkably similar to the guidelines already 

established by disability rights advocates. The Secretary of HHS sent a letter to every state 

governor emphasizing the import of the Olmstead decision for persons with disabilities who are 

unnecessarily institutionalized. The letter encouraged the states to develop and implement 

“comprehensive, effectively working plans” as suggested by the Supreme Court to ensure that 

individuals with disabilities receive services in the most integrated setting appropriate to their 

needs. On the same day, HHS wrote to state Medicaid directors encouraging them to work with 

state human service agencies to foster the integration of persons with disabilities into community 

life, promote equal opportunity, and maximize individual choice. The agency’s guidelines had 

much in common with the guidelines previously developed by advocates. 

community services are identified and enabled to move from institution to community in 

accordance with specific timeframes, recommend service enhancement and expansion, identify 

barriers to community services and solutions, evaluate the integration implementation process, 

and develop recommendations for funding; and (5) recognize the role of people with disabilities 

in designing and choosing their own support services. Memorandum from Disability Policy 

Consortium to Don Gilbert, Commissioner (October 5, 1999). 

206For example, on October 6, 1999, the Texas Disability Policy Consortium sponsored a 

conference on the implications of the Olmstead decision at which approximately 165 consumers, 

advocates, and state agency personnel discussed Olmstead implementation with Tom Perez, 

director of HHS OCR, and Ralph Rouse, regional manager, Region VI, HHS. See also Statewide 

Independent Living Councils (SILC) Congress Resolution #10 (January 6, 2000), calling on 

states to work with disability advocates to develop plans for transition to community living. 

83

The HHS letter defined a “comprehensive, effectively working plan” in clear, operational terms. 

In developing such a plan, the state should consider— 

� the extent to which existing programs can serve as a framework for developing 

services; 

� the level of awareness and agreement among stakeholders and decisionmakers 

regarding the elements needed to create an effective system; and 

� how this foundation can be strengthened. 

A plan for providing services to persons with disabilities in more integrated community settings 

should— 

� ensure that qualified persons with disabilities transition to the community; 

� ensure that the transition moves at a reasonable pace; and 

� identify improvements that can be made to support people with disabilities in the 

community. 

The planning process must ensure that persons with disabilities— 

� receive assessments to determine how community living might be possible; 

� are assessed for their ability to benefit from community living without limiting 

consideration to what is currently available in the community; and 

� are provided the opportunity for informed choice. 

The plan should examine the adequacy of the state’s current periodic reviews of institutional 

residents to determine whether they are— 

84

� thorough;


� objective;


� conducted for residents of all institutional settings, including ICFs/MR, nursing


facilities, psychiatric hospitals, and residential service facilities for children; and 

� adequate to determine whether institutional residents can be served in a more 

integrated setting. 

The plan should establish similar procedures for persons who may be at risk of unjustifiable 

institutionalization. In the plan development process, the state should— 

� involve people with disabilities;


� employ methods that ensure constructive, ongoing involvement and dialogue; and


� establish partnerships with stakeholders to ensure that plans are comprehensive


and work effectively. 

To remedy unjustified institutionalization, the state needs— 

� a reliable sense of how many people with disabilities are currently 

institutionalized and eligible for services in community-based settings; 

� adequate information and data systems about institutionalization and eligibility; 

and 

� a willingness to make improvements to data collection systems when necessary. 

The state needs to look closely at existing assessment procedures and whether they are— 

� adequate to identify institutionalized persons with disabilities who could benefit 

from services in a more integrated setting; and 

85

� adequate to identify individuals in the community who are at risk of placement in 

an unnecessarily restrictive setting. 

The plan should ensure that the state could respond to assessment findings in a manner that is 

timely and effective. 

To ensure the availability of community-integrated services to persons who are unnecessarily 

institutionalized, the plan should— 

� identify what community-based services are available in the state;


� assess the extent to which these programs are able to serve people with disabilities


in the most integrated setting appropriate; 

� identify the improvements that can be made in existing services; 

� consider how the system might be made more comprehensive; 

� evaluate whether the identified supports and services meet the needs of people 

who are likely to require assistance to live in the community; and 

� identify the changes that could improve the availability, quality, and adequacy of 

the supports. 

The plan should look at people who are at risk of unjustified institutionalization and— 

� evaluate whether the system adequately plans for supporting people who live at 

home with family; and 

� consider whether the plan is adequate to address the needs of people without 

family or other informal caregivers. 

The plan should look at the real-world outcomes of supports and services and how they actually 

help integrate people with disabilities into the community. 

86

The state should look at funding for the plan; specifically, it should— 

� review the funding sources available under Medicaid and other sources to increase 

the availability of community-based services; 

� consider what efforts are underway to coordinate access to these services; and 

� assess the feasibility of organizing these funding sources into a coherent system of 

long-term care. 

Planners should assess— 

� how well the current system works; 

� how it works for different groups (e.g., elders with disabilities or persons with 

physical disabilities, developmental disabilities, or HIV/AIDS); and 

� the changes needed to make services in the most integrated setting a reality for all 

populations. 

The plan should examine what can be done to ensure that people waiting for services— 

� are able to move off waiting lists; 

� receive needed community services; and 

� receive needed services at a reasonable pace. 

Plans should honor the principle of informed choice by— 

� providing opportunities for informed choice; 

� providing choices both to persons with disabilities and their representatives; and 

� addressing the information, education, and referral systems needed to ensure 

informed choice. 

87

Finally, the plan should address the infrastructure changes that may be needed to support 

implementation of the plan. Planners should— 

� evaluate effective quality assurance systems for community services; and 

� consider the planning, contracting, and management infrastructure that will enable 

placement in the most integrated setting to become the norm.207 

Subsequently, HHS issued other policy clarifications to assist states in placing institutionalized 

Medicaid beneficiaries in more integrated settings. HHS’ Olmstead Update No. 2, issued on July 

25, 2000, answered a number of questions the agency had received from states and the disability 

community. In this memo, HHS affirmed its willingness to provide technical assistance to 

promise effective implementation of its policy of facilitating the provision of services in the most 

integrated setting and to provide federal financial participation to states to design and administer 

Olmstead plans. HHS announced that it was reviewing its own policies, programs, statutes, and 

regulations to “identify ways to enhance and improve the availability of community-based 

services.” The memo clarified the role of Olmstead planning in resolving OCR complaints: 

Where States or other “respondents” (entities against which OCR has received 

complaints) engage in planning processes in good faith and at a reasonable pace, 

OCR may determine it is possible to allow plan development to proceed in lieu of 

investigation. Where a State or other respondent evinces no intent to undertake 

planning, or where delays in doing so evidence a lack of good faith, or where 

States or other respondents utterly fail to involve stakeholders in plan 

development, OCR may determine it necessary to commence a full-blown 

investigation. Following investigation, if a violation is found and no resolution is 

reached, cases may be referred to DOJ for litigation.208 

207HHS Letter to State Medicaid Directors, January 14, 2000. 

208http://www.cms.hhs.gov/states/letters/snd72500.asp. 

88

HHS clarified that in the context of a complaint investigation in which plan development seems 

an appropriate remedy, OCR “typically” would ask the state to demonstrate the pace at which 

services to persons with disabilities would be provided in the most integrated setting. HHS also 

clarified that Olmstead applies to all qualified individuals with a disability who are covered by 

the ADA, including elders and children with disabilities and persons with a history of substance 

abuse, and made clear that unjustified segregation would violate not only the ADA but also 

Section 504 of the Rehabilitation Act of 1973. 

In Olmstead Update No. 3, issued on July 25, 2000, CMS issued a number of policy 

clarifications, most concerning Medicaid coverage of waiver services, including case 

management, environmental modifications, personal assistance, “nurse-delegated” services, and 

services provided out of state. CMS also clarified that the Medicare “homebound” requirement 

does not apply to Medicaid home health services.209 

In Olmstead Update No. 4, issued on January 10, 2001, CMS clarified some of the boundaries of 

the state’s obligations to provide services under the home- and community-based waiver and the 

relationship between the state’s obligations under Medicaid and its obligations under the ADA 

and Olmstead. The agency’s interpretations of the state’s obligations under the waiver and its 

209HHS Letter to State Medicaid Directors, July 25, 2000. See Smith, et al., 

Understanding Medicaid Home and Community Services: A Primer (2000) at 54 (it is not 

necessary for Medicaid beneficiaries to meet the Medicare requirement of being homebound 

to receive home health services under Medicaid). Although Medicaid home health recipients 

need not be homebound to receive home health services, CMS regulations require that home 

health services be provided in the home. A federal appeals court has held that the HHS 

regulation limiting Medicaid coverage to home health care services provided at the 

recipient’s place of residence is an unreasonable, arbitrary, and capricious interpretation of 

the statute establishing home health care as mandatory and affirmed a district court order 

permanently enjoining state and HHS officials from denying Medicaid funding to members 

of the plaintiffs’ class for medically necessary home health nursing services outside their 

residences. Skubel v. Fuoroli, 113 F.3d 330 (2d Cir. 1997). 

89

obligation to provide services with “reasonable promptness” have important implications for 

Olmstead implementation. 

Update No. 4 clarified that whereas a state may set a limit on the number of persons who may 

receive services under a home- and community-based services waiver, this does not limit its 

obligation to serve people with disabilities in the most integrated setting nor to provide a safe 

harbor: “If other laws (e.g., ADA) require the State to serve more people, the State may do so 

using non-Medicaid funds or may request an increase in the number of people permitted under 

the HCBS [home- and community-based services] waiver.” States may request a waiver 

amendment to increase the number of persons served at any time. The amendment is usually 

retroactive to the first day of the waiver year in which the request was submitted.210 

Update No. 4 clarified the relationship between the number of waiver slots requested and the 

program’s funding appropriation. CMS stated that it has allowed states to limit the number of 

people to be served to a number derived from the amount of money the legislature has made 

available and the corresponding federal match, but only if the application so informs the agency. 

The state must inform CMS of any limit on the number of persons served derived from a fiscal 

appropriation made subsequent to the submission of the waiver application.211 

Update No. 4 clarified that once enrolled in the waiver, the person cannot be denied a needed 

service that is covered by the waiver, and states are not allowed to place a limit on the number of 

enrollees permitted access to different waiver services. Although CMS did not set guidelines in 

this letter for “reasonable promptness” in the provision of waiver services, the agency indicated 

210HHS Letter to State Medicaid Directors, January 10, 2001, [1] at 4–5. 

211Id. at 5. 

90

that, in its view, “reasonableness” would vary with the urgency of the person’s need for the 

service at issue.212 

The letter addressed the important question of how CMS will review states’ limits on the 

amount, duration, and scope of waiver services. The agency stated that it would ask “whether the 

amount, duration and scope of all the services offered through the waiver (together with the 

State’s Medicaid plan and other services available to waiver enrollees) is sufficient to achieve the 

purpose of the waiver as a community alternative to institutionalization.” In sum, the 

“sufficiency” question may be answered only by “a three-way review” of the needs of the target 

group, the services available to that group under the Medicaid State plan and other relevant 

entitlement programs, and the type and extent of waiver services.

213 The message to states that 

CMS will examine the adequacy of waiver services to meet the needs of the proposed 

beneficiaries is a powerful one given the current propensity of some states to seek approval for 

multiple waivers, each with a different service mix and cost cap. 

While acknowledging that states generally have discretion to amend a home- and communitybased waiver to reduce the total number of persons who may be served under the waiver, CMS 

informed the states that it would take certain “special considerations” into account in reviewing a 

request for a waiver amendment. First, if the number of waiver eligibles is “a material item in 

any ongoing legal proceeding” or investigation, the state should notify CMS and the court (in the 

case of a pending lawsuit) and the HHS OCR (in the case of a civil rights investigation) of the 

state’s request for a waiver amendment.

214 Second, the state must assure CMS that “the health, 

212Id. at 5–6. 

213Id. at 7. 

214Because the courts have held that persons with disabilities eligible for home- and 

community-based waiver services have an entitlement to those services up to the number of 

persons the state has applied to serve in the waiver, that limit, or “cap,” will frequently be a 

“material item” in litigation. The requirement that states inform the court where such an action is 

91

welfare and rights of all individuals already enrolled in the waiver” will be protected, including 

the right to live in the most integrated setting. The state can accomplish this by assuring HCFA 

that no one will be removed from the waiver or inappropriately institutionalized or that persons 

removed from the waiver program will receive community services through other programs.215 

CMS clarified that states have some flexibility in defining targeting criteria as long as the waiver 

is limited to one of the three subgroups defined in the statute (aged or disabled, developmentally 

disabled, and mentally ill), thus encouraging states to broaden the populations served in their 

waivers.216 Finally, CMS clarified that waiver services may not be used to deny or limit services 

that are available under the Early and Periodic Screening, Diagnosis and Treatment (EPSDT) 

children’s health care program, a Medicaid entitlement. 

Olmstead Update No. 5, also dated January 10, 2001, is an announcement of the system-change 

grants, described as additional tools to improve state long-term care systems “so as to fulfill the 

promise of the ADA.”217 The concept of system-change grants was borrowed from a provision in 

MiCASSA that would allow states to receive grants for Real Choice Systems Change Initiatives 

to help the states change the institutional focus of their long-term care systems and refocus those 

pending is taken from Boulet v. Cellucci, 107 F.Supp. 2d 61, 70 (D. Mass. 2000), where the 

defendants amended their waiver to lower the number of persons who could receive waiver 

services without notifying the court. 

215Id. at 8 (emphasis added). 

216Id. at 9. 

217HHS Letter to State Medicaid Directors, January 10, 2001 [2] at 1. 

92

systems on community services and supports.218 The system-change grants have emerged as the 

Federal Government’s most significant Olmstead implementation effort to date. 

Three types of grants are available. The first type is the Real Choice Systems Change grants, 

which are designed to help states work in partnership with their disability and aging communities 

to enable people with disabilities or chronic illness to live “fuller, more self-directed lives.” Fifty 

million dollars was available to the states under this program in 2001–2002.219 

HHS also announced that it would allocate $12 to $15 million in Nursing Facility Transition 

grants and Access Housing grants to enable people of all ages who live in nursing homes to make 

a successful transition to community living. The agency has notified states that, to receive grant 

awards, state Medicaid agencies should work in partnership with state and local housing 

authorities to make full use of all applicable HUD programs that benefit low-income elderly 

individuals and those with disabilities.220 

CMS also announced that it would award $5 million to $8 million in state infrastructure grants to 

help states develop or improve community-based attendant service systems that offer individuals 

218At the time Olmstead was decided, the disability rights movement was engaged in 

intensive advocacy for passage of the Medicaid Community Attendant Services and Supports Act 

(MiCASSA). An earlier version of MiCASSA was introduced in the 105th Congress but did not 

pass; in the 106th Congress, MiCASSA was introduced on November 16, 1999, as S. 1935. 

MiCASSA was reintroduced in the 107th Congress on August 1, 2001, as S. 2198. 

219HHS Letter to State Medicaid Directors, January 10, 2001 [2] at 2. 

220Bianco et al., Overcoming Barriers to Community Integration for Persons with Mental 

Illness (SAMHSA, 2001) at 14. In a related initiative, the U.S. Department of Housing and 

Urban Development (HUD) announced that it would make up to 400 Section 8 vouchers 

available for use by eligible nonelderly individuals with a disability who make the transition 

from a nursing facility to the community. States may apply for both the state program grant and 

the Section 8 rent vouchers as part of a single application, or they may apply for just one of the 

two programs. 

93

with disabilities maximum control. The goal of this program is to create systems that support 

self-determination for people with disabilities. Eligible activities, for example, will include 

training consumers to recruit and supervise personal care attendants and to understand their fiscal 

and legal responsibilities as employers.221 

Thirty-seven states received grants during the first round of this initiative. Of the $70 million 

available for the program, about $64 million was allocated to grantees.222 In 2002, another $55 

million was made available.

223 Although the amounts allocated under the grants have been small, 

typically $2 million or less for Real Choice Systems Change grants and less than $1 million for 

the other grant categories, the grants are unique in requiring states to work directly with the 

disability community. CMS notified applicants that it expects “continuous and active 

involvement of consumers in project design, implementation, and evaluation.”224 Five grants 

were awarded to partnerships between states and Independent Living Centers to transition 

nursing facility residents to the community, and Centers for Independent Living (CILs) play a 

direct role in implementing other states’ Nursing Facility Transition grants.225 

In a letter to the governors of the states on August 12, 2002, HHS Secretary Tommy Thompson 

urged continued efforts to overcome the institutional bias in Medicaid programs. Secretary 

221Bianco et al., Overcoming Barriers to Community Integration for Persons with Mental 

Illness (SAMHSA, 2001) at 14. 

222CMS, “Systems Change Grants for Community Living,” 

www.cms.hhs.gov/systemschange/. 

223HHS, “Administration Announces Steps to Promote Community Living for People 

with Disabilities,” News Release (May 25, 2002). 

224HHS, “Overview of FY 2002 Systems Change Grants Award Process,” 

http://www.cms.hhs.gov/systemschange/2002over.pdf. 

22567 Federal Register 20791 (April 26, 2002). See the state-by-state descriptions of the 

grant projects at www.hcbs.org. 

94

Thompson noted that states already have many affordable community-based options for serving 

people with disabilities, and he pointed to a new Web site identifying promising practices. 

“The President’s New Freedom Initiative builds on our partnership to assure Medicaid-eligible 

individuals with disabilities are served in the most appropriate setting according to their own 

needs and preferences,” Secretary Thompson wrote in his August 12, 2002, letter to the 

governors. “We believe there is a tremendous opportunity to serve people who meet nursing 

facility levels of care in their own homes or other community residential settings without 

increasing costs.” Secretary Thompson noted that a number of states have already developed and 

implemented programs that serve individuals in community settings rather than institutions, 

including diversion programs to keep people in the community, transition programs to move 

individuals from institutional settings to community placements, and program models in which 

“the money follows the person” to ensure stability for beneficiaries living in the community. 

On August 13, 2002, HHS wrote a letter to state Medicaid directors echoing Secretary 

Thompson’s recommendations and noting a number of promising practices employed by the 

states that have facilitated the movement of institutional residents to the community and 

enhanced opportunities for community integration: 

[T]he Center for Medicaid and State Operations believes there is tremendous 

potential to serve people who meet nursing facility level of care in private homes 

or in community residential settings that would be more acceptable to the 

beneficiary, without increasing costs to the states. 

Many states have engaged in activities and developed programs that serve persons 

in the most appropriate community setting rather than in an institution. These 

programs and activities, developed under existing authority, have included 

diversion programs to maintain people in the community, transition programs to 

actively move individuals from institutional settings to alternative community 

95

placements, and program models in which the ‘money follows the person’ to 

assure stability of community living.

226 

In other words, HHS informed the states that by using existing federal funding sources 

appropriately, they could support nursing facility residents in the community without incurring 

additional costs. In a time of fiscal scarcity and draconian state budget cuts, the significance of 

this message cannot be overstated. Further, HHS affirmed the principle of “the money follows 

the person,” so movement from institutions need not be contingent on the infusion of new 

funding sources. 

The following are examples of the promising practices to which HHS drew the states’ attention: 

� The Colorado “Fast Track” program, which provides on-site assessment for 

waiver services and Medicaid eligibility determination within a hospital setting to 

divert hospital discharges from nursing facility placement. 

� Texas’s Rider 37, a state law providing that as individuals “relocate from nursing 

facilities to community care, funds will be transferred from Nursing Facilities to 

Community Care Services to cover the cost of the shift in services.” 

� Florida’s Long-Term Care Community Diversion Project, a pilot project in four 

counties, in which managed care organizations (MCOs) are paid a capitated rate to 

provide all Medicaid services, including both home- and community-based 

services and nursing facility services, to eligible elders so that the MCO has a 

strong incentive to reduce nursing home placements. 

� New Jersey’s Community Choice Initiative, in which 40 state employees are 

exclusively dedicated to informing nursing home residents and persons in 

hospitals awaiting nursing facility admission about home- and community-based 

services and housing alternatives. 

226HHS, Letter to State Medicaid Directors, August 13, 2002. 

96

� Utah’s program in which representatives from Area Agencies on Aging (AAAs) 

and CILs visit nursing facilities every six months to conduct on-site resident 

education about home- and community-based long-term care programs, conduct 

one-on-one follow-up interviews for interested residents, and, on request, perform 

needs assessments to determine if the person’s needs could be met using available 

community resources. 

� Vermont’s new waiting list policy for home- and community-based services, 

which gives priority to nursing home residents, hospital patients awaiting nursing 

home placement, and people residing at home who are at great risk of 

institutionalization. 

� Washington’s post-eligibility treatment of income rules that allow Medicaidsupported nursing facility residents to use their own income for up to six 

months—up to 100 percent of the poverty level—to make rent, mortgage, utility, 

and other payments to maintain their home in the community. Nursing facility 

residents moving to the community can receive a one-time payment of up to $800 

of state-only funds to pay for rent, security deposits, utilities, household goods, 

assistive technology, furniture, or home modifications. 

� Wisconsin’s state fund that enables people moving from nursing facilities to 

bypass county waiting lists.227 

In the August 13 letter, HHS also informed the states that an evaluation was underway of the 

Real Choice Systems Change grants. In the meantime, however, the agency summarized some of 

the lessons learned from the states’ experience with the grants: 

227Id. 

97

� Staff who work with nursing facility residents to facilitate transition for them 

should be hired specifically for this purpose and should be highly dedicated to the 

challenge; people who have lived in institutional settings are especially effective. 

� To establish a community residence for people leaving nursing facilities, flexible 

funding should be made available to be used for security deposits, utility setup, 

moving expenses, furnishings, and other necessary expenses. 

� Nursing facility transition programs should be closely coordinated with 

community-based services programs. 

� Transition program staff should work with public housing authorities and private 

landlords. 

� Transition programs should implement aggressive outreach efforts to notify 

nursing facility residents of the opportunities for receiving assistance with moving 

back to community life. 

� Nursing facility residents should take an active role in planning their own return to 

community life.

228 

HHS has made $50 million available to assist states to develop and improve home- and 

community-based services and planning for Olmstead implementation. Initial awards of $50,000 

were made to all states and territories requesting one. These start-up funds will help pay for the 

planning and public-private partnerships and task forces to advise the states on how to increase 

services and supports to people with disabilities. 

228Id. 

98

3. Other HHS Initiatives 

(a) Office for Civil Rights 

Since Olmstead was decided, OCR has investigated hundreds of complaints filed by persons with 

disabilities alleging that they are inappropriately institutionalized or at serious risk of 

institutionalization. An analysis of 334 complaints filed with OCR found that more than half—55 

percent—were filed by persons with physical disabilities, 23 percent by persons with 

developmental disabilities, and 22 percent by persons with mental illnesses. (These categories 

overlapped because some complainants had more than one diagnosis.) In 44 cases, the 

complainants were of school age. Nursing facilities were the most common residential setting 

where complainants lived, accounting for 60 percent of all complaints. Another 30 percent of 

complaints were filed by residents of psychiatric institutions.229 

OCR representatives have participated in the Olmstead advocacy training sponsored by HHS, 

CMS, and the Department of Education (ED); met with state officials to explain the legal basis 

for Olmstead planning and implementation; and provided significant technical assistance to the 

states, including assistance in Olmstead planning and application of HHS standards to state 

Olmstead plans.230 

229S. Rosenbaum et al., “An Analysis of Olmstead Complaints: Implications for Policy 

and Long-Term Planning” (Center for Health Care Strategies, Inc. Consumer Action Series 

Working Paper 2,5,6, December, 2001). 

230Interview with Tony Records, October 6, 2002. 

99

(b) Advocacy Training and Technical Assistance 

In 2001, HHS, CMS, and ED funded a national conference of experts and a series of regional 

training conferences titled “Disability Advocacy in a Post-Olmstead Environment.” The trainings 

were designed primarily to prepare disability rights advocates to advance implementation of the 

Olmstead decision within each state. Secondary audiences included legislators, governors’ office 

representatives, and other state officials. The training was designed and delivered by Independent 

Living Research Utilization (ILRU) and the Brain Injury Association, Inc. (BIA), and training 

topics included the Olmstead decision, consumer direction, personal assistance services, 

Medicaid policy and practices, related state laws, Olmstead plans, related services and benefits, 

and exemplary programs and strategies for Olmstead implementation. Each state could send to 

the training up to eight participants who had to be nominated by disability leaders and 

demonstrate that they had the backing of a disability advocacy organization, such as a CIL. In the 

second year of the Olmstead project, the core group of participants trained in the first year will 

receive additional technical assistance and problem-solving support from experts to assist those 

participants in implementing the Olmstead decision in each state.231 From the experience of 

Olmstead implementation at the state level, advocates who have participated in the Olmstead 

trainings clearly are well equipped to critique their states’ planning efforts and propose 

constructive alternatives.

232 

231U.S. Department of Education, Self-Evaluation to Promote Community Living for 

People with Disabilities (2002) at 3; Independent Living Resource Utilization, Olmstead 

Resources, http://www.ilru.org/olmstead/. The training curriculum is available at 

http://www.ilru.org/olmstead/publication/manual.htm. IRLU NetWork (March 2001). 

232See Chapter VI of this report. 

100

4. Substance Abuse and Mental Health Services Administration (SAMHSA) Initiatives 

On December 14, 2000, SAMHSA’s Center for Mental Health Services (CMHS) sponsored a 

meeting of 40 federal agencies, national mental advocacy organizations, consumer groups, and 

private sector companies to establish a National Coalition to be composed of representatives of 

the Departments of Labor, Health and Human Services, Housing and Urban Development, 

Education, Justice, Transportation, and Veterans Affairs; the Social Security Administration 

(SSA); and the President’s Task Force on Employment of Adults with Disabilities, along with 

community leaders from dozens of national organizations, “to promote community-based care for 

persons with mental illness in accordance with Olmstead v. L.C.” The Coalition proposed to lead 

the development of similar coalitions at the state level that, in turn, would aid in the design and 

development of comprehensive community mental health service plans.” CMHS committed $6.3 

million to help develop the statewide coalitions, provide training, and support an Olmstead 

coordinator in each state.233 

As of June 2001, 43 states had received grants of $20,000 to support state coalitions and 

Olmstead coordinators.234 The National Coalition, now called the National and Statewide 

Coalitions to Promise Community-Based Care, provides technical assistance to state Olmstead 

Coalitions through a team of national consultants. The impact of the Olmstead Coalitions is 

233“National Coalition Formed to Promote Community-based Care for Persons With 

Mental Illness under Landmark Supreme Court Decision,” http://www.samhsa.gov/news/ 

newsreleases/001214Onrolmstead.htm. 

234Home and Community-Based Services Resource Network, “A Compendium of Current 

Federal Initiatives in Response to the Olmstead Decision” (July 10, 2001) at 28. See Bianco et 

al., Overcoming Barriers to Community Integration for Persons with Mental Illness (SAMHSA, 

2001). 

101

apparent at the state level, where several of the Coalitions have persuaded reluctant state 

governments to address Olmstead implementation in more meaningful form.235 

SAMSHA is also conducting a $20 million study to determine the effectiveness of mental health 

service consumer-oriented programs as an adjunct to traditional mental health services.236 Other 

SAMHSA activities include convening technical assistance conferences and meetings on 

employment of persons with psychiatric disabilities, involuntary treatment, and electroconvulsive therapy and establishing a CMHS National Advisory Council Subcommittee on 

Consumer/Survivor Issues.237 

(a) Administration on Aging 

In February 2001, the Administration on Aging launched a National Family Caregiver Support 

Program funded at $125 million. States can use this program to support elders who are not 

eligible for Medicaid. 

5. Housing Initiatives 

Without affordable and accessible housing, large numbers of persons with disabilities who are 

unnecessarily institutionalized will be unable to move to the community. Yet, unlike HHS, which 

began working with state Medicaid agencies shortly after Olmstead was decided to assist them in 

235See Chapter VI of this report. 

236U.S. Department of Health and Human Services, “HHS Announces Efforts to 

Implement Community-Based Alternatives for Individuals With Disabilities,” News Release, 

June 19, 2001. 

237Home and Community-Based Services Resource Network, “A Compendium of Current 

Federal Initiatives in Response to the Olmstead Decision” (July 10, 2001) at 28–29. 

102

incorporating the integration mandate into their delivery of services to persons with disabilities, 

HUD has not played an active role in fostering Olmstead implementation.238 

HUD did, however, launch two initiatives in 2001 to expand housing opportunities for persons 

with disabilities: the Section 8 Homeownership Voucher Pilot Program for Disabled Families

239 

and the Project Access Demonstration.240 As implemented by HUD, the Homeownership 

Voucher Pilot is targeted to persons with disabilities with incomes up to 99 percent of the median 

income in the area. To be eligible, a household must have an annual income of at least $10,000. 

Thus, the program targets persons with disabilities who have higher household incomes; the 

income requirements would have precluded the two plaintiffs in Olmstead v. L.C. from 

participating in this project. The impact of this promising practice is also limited by the fact that 

local public housing authorities (PHAs) are not required to participate nor to include persons 

with disabilities in the home ownership program.241 

The second project, called Project Access, initially provided 400 rental vouchers in 11 states and 

a projected 2,000 at full implementation that are being distributed in collaboration with HHS to 

connect people moving from nursing facilities to the community with Medicaid-funded services. 

HUD provides rental vouchers and technical assistance, and HHS will use Nursing Home 

238See Technical Assistance Collaborative and Consortium for Citizens with Disabilities 

Housing Task Force, 12 OPENING DOORS (December, 2000) at 1–2. 

239On December 27, 2000, the American Homeownership and Economic Opportunity Act 

of 2000 was enacted. This statute permits Section 8 voucher recipients with disabilities to use up 

to a year’s worth of vouchers to finance the down payment on a home. Regulations were 

published in the Federal Register on June 22, 2001. 

240U.S. Department of Housing and Urban Development, “President’s Executive Order 

Launches Independent Living and Homeownership Program for Disabled,” News Release (June 

19, 2001). 

241B. O’Day, Issues in Rural Independence: Revisited (2001) at 12. 

103

Transition grants or other Medicaid funds to assist people moving from nursing facilities to the 

community. Some disability organizations were concerned that this program actually took 

resources from another program at HUD that was serving people with disabilities242 and that it 

would “direct Section 8 vouchers to a number of settings that fly in the face of the inclusion 

mandate of the ADA, such as assisted living and residential ‘facilities.’”243 

6. The Work Incentives Improvement Act 

Although not a direct response to Olmstead, the Work Incentives Improvement Act was enacted 

to overcome a barrier to community integration: the loss of public health benefits for Medicaid 

beneficiaries who wish to return to work. The Act provides that persons receiving SSDI and 

Medicare benefits who return to work can receive up to six additional years of Medicare benefits. 

States also have the option to amend their Title XIX state plans to offer Medicaid coverage to 

persons who, but for their income and resource levels, would be eligible to receive SSI. In return, 

the state may apply a sliding-scale premium for Medicaid-funded health care services. This 

should allow persons receiving Medicaid benefits to continue their general Medicaid coverage 

and to continue to receive whatever services they are receiving under a waiver program. States 

may also offer Medicaid coverage to individuals with a medically improved disability who lose 

Medicaid coverage because they no longer meet the definition of disability. 

The Work Incentives Improvement Act provides a voucher from the Social Security 

Administration—called a “ticket to work”—that Medicaid beneficiaries can use to shop for a 

program from approved providers. Providers will be paid, not on a fee-for-service basis, but for 

documented outcomes for the person with disabilities. Providers also will be paid an incentive in 

242Andrew Sperling, Deputy Executive Director for Policy, National Alliance for the 

Mentally Ill, National Listening Session, PM testimony at 190–91. 

243Consortium of Citizens with Disabilities (CCD) Housing Task Force, Non-Support 

Letter to HUD, February 19, 2001. 

104

the form of a percentage of the federal benefits the person would have been paid, as long as the 

person they are serving maintains employment. However, providers will not be paid until the 

person leaves the Social Security rolls. Since the number of SSI and SSDI beneficiaries who find 

it possible to leave the rolls altogether is very small, providers of employment-related services 

may be reluctant to risk failure by serving persons with more significant disabilities.244 State 

Vocational Rehabilitation (VR) agencies may participate in the Ticket to Work program as an 

employment network. If the VR agency is the designated employment network and has written 

agreements with providers in the network to provide vocational services, providers can at least be 

assured of payment for their services. However, VR participation is optional. 

7. The Executive Order 

During his presidential campaign, George W. Bush promised that if he were elected, he would 

issue an Executive Order committing his Administration to implementation of the Olmstead 

decision.245 After his election, President Bush announced the New Freedom Initiative on 

February 1, 2000, and repeated his commitment to sign an order that Olmstead be fully 

implemented.

246 When the order had not been signed more than three months later, advocates 

held a demonstration in Washington, D.C., to press the point. Less than an hour after the 

demonstration began, some advocacy representatives were invited to meet with the director of the 

President’s Domestic Policy Council and were informed that the Executive Order would be 

244Bianco et al., Overcoming Barriers to Community Integration for Persons with Mental 

Illness (SAMHSA, 2001) at 21. 

245George W. Bush, “New Freedom Initiative” (speech delivered in Portland, Maine, June 

15, 2000). 

246George W. Bush, “Remarks by the President in Announcement of New Freedom 

Initiative” (White House, February 1, 2001). The Initiative contains five components: increasing 

access to assistive technology and universal design technologies; expanding educational 

opportunities; promoting homeownership; integrating Americans with disabilities into the 

workforce; and promoting full access to community life. 

105

completed and signed within 30 days. Accordingly, President Bush issued Executive Order No. 

13217, “Community-Based Alternatives for Individuals with Disabilities,” on June 18, 2001. The 

Order asserted the Administration’s commitment to implementation of the integration imperative 

of the ADA as interpreted by the Supreme Court in Olmstead v. L.C. 

The Order affirmed the commitment of the government of the United States to five fundamental 

principles concerning the right of persons with disabilities to live in the community: 

1. 	 Community-based alternatives for individuals with disabilities advance the best 

interests of Americans. 

2.	 Community-based alternatives should foster independence and participation in 

the community for persons with disabilities. 

3.	 Unjustified isolation or segregation of qualified individuals with disabilities 

through institutionalization is a form of disability-based discrimination prohibited 

by Title II of the ADA and must be avoided by states unless doing so would 

fundamentally alter the nature of the service, program, or activity. 

4.	 The Supreme Court in Olmstead construed the ADA to require states to place 

individuals with disabilities in community settings, rather than institutions, 

whenever treatment professionals determine that such treatment is appropriate, the 

affected individuals do not oppose community placement, and the state can 

reasonably accommodate the placement given the resources available to the state 

and the needs of others with disabilities. 

5.	 The Federal Government must assist states and localities to implement swiftly the 

Olmstead decision to ensure all Americans have the opportunity to live close to 

106

their families and friends, to live more independently, to engage in productive 

employment, and to participate in community life. 

The Executive Order requires federal agencies to promote community living for persons with 

disabilities by (1) providing coordinated technical assistance to states; (2) identifying specific 

barriers in federal law, regulation, policy, and practice that impede community participation; and 

(3) enforcing the rights of persons with disabilities. Specifically, the Order requires federal 

agencies to collaborate to ensure that the Olmstead mandate is implemented in a timely manner. 

Agencies that work with states are to help states assess their compliance with Olmstead and ensure 

that federal resources are used in the most effective manner to support the goals of the ADA. 

The Order directs federal agencies to “evaluate the policies, programs, statutes, and regulations 

of their respective agencies to determine whether any should be revised or modified to improve 

the availability of community-based services for qualified individuals with disabilities.” The 

purpose of the review is to identify affected populations, improve information about community 

support, and remove barriers to community placement. The review must include consumers, 

advocacy organizations, and service providers. 

Finally, the Order directs the Attorney General and the Secretary of HHS to “fully enforce Title II 

of the ADA.” The agencies are encouraged to work cooperatively with states and to use 

alternative dispute resolution procedures. 

Following the Executive Order, the Administration carried out an extensive public comment 

process to assist the agencies in conducting their self-evaluations. The public comment process 

was led by HHS through the new Interagency Council on Community Living and launched in an 

open letter from Secretary of HHS Thompson to all interested parties inviting their input. The 

agencies gathered information from the public for their self-evaluations through written 

comments, a national teleconference held on August 15, 2001, a National Listening Session held 

107

on September 5, 2001, and studies and policy research. More than 800 individuals and 

organizations provided comment. 

In HHS, Deputy Secretary Claude Allen convened a department-wide task force known as the 

New Freedom Initiative Group. Each of HHS’ 17 component offices appointed a senior-level 

manager and a key staff person to the group. The Deputy Secretary then directed all HHS 

components to conduct separate self-evaluations. Each component was asked to look at its 

policies, programs, statutes, and regulations and respond to two questions: 

1.	 Does any policy, program, statute, or regulation inhibit the ability of individuals 

with disabilities to live in the community? 

2.	 Can any of these be revised or modified to improve the availability of communitybased services for people with disabilities?247 

The group met biweekly to review and analyze policies, program administration, laws, 

regulations, program guidance documents, data systems, research, budget and program planning 

documents, information about past and current component activities, contract documents, and 

human resource materials.248 

On December 21, 2001, HHS issued a preliminary report on its own actions and those of the 

Departments of Labor, Education, Housing and Urban Development, Justice, Transportation, and 

Veterans Affairs; the Office of Personnel Management (OPM); and the Social Security 

Administration (SSA) to fulfill the mandate of the Executive Order. The preliminary report 

247U.S. Department of Health and Human Services, Self-Evaluation to Promote 

Community Living for People with Disabilities (March 2002) at A-51. 

248U.S. Department of Health and Human Services, Self-Evaluation to Promote 

Community Living for People with Disabilities (March 2002) at A-51–52. 

108

identified barriers to community integration and described the agencies’ proposed solutions.249 

The agencies’ final, more detailed reports were released on March 25, 2002.250 The final reports 

contained few changes from the preliminary report. 

8.	 Actions and Proposed Actions by Federal Agencies, as Reported in “Delivering on 

the Promise” 

(a) Health Care Structure and Financing 

The report acknowledged the institutional bias of the Medical Assistance Program, in which 73 

percent of Medicaid long-term care funding goes to pay for institutional care and only 27 percent 

toward home- and community-based services. However, the principal action proposed to address 

this systemic barrier was the creation of a Medicaid Community Services Reform Task Force 

within HHS to advise on removing barriers to community integration. HHS did promise a 

“coordinated package of regulatory or potential legislative improvements” to reduce barriers to 

community living and institutional biases in the Title XIX program, but although the proposed 

changes would result in marginal improvement, they would not squarely address the 

disproportionate funding of institutional services by Medicaid. HHS proposed to do the following: 

� Make home- and community-based waiver renewal less burdensome by removing 

the requirement that states seek renewal of a Section 1915(c) waiver unless CMS 

requests renewal because of performance problems. 

249U.S. Department of Health and Human Services, Delivering on the Promise: 

Preliminary Report of Federal Agencies’ Actions to Eliminate Barriers and Promote Community 

Integration (December 21, 2001). 

250U.S. Department of Health and Human Services, “Compilation of Individual Federal 

Agency Reports to Eliminate Barriers and Promote Community Integration,” May 9, 2002, 

http://www.hhs.gov/newfreedom/final/. 

109

� Clarify that one-time costs of transition to a community residence may be covered 

under a home- and community-based services waiver, including such costs as 

security deposits, initial furnishings, and utility and telephone setup fees and 

deposits. HHS also promised to allow Durable Medical Equipment, prosthetics, 

orthotics, and supplies to be furnished to skilled nursing facility residents prior to 

discharge. 

� Clarify that the need for “active treatment” is distinct from level of care and not 

required to qualify for services under a home- and community-based mentally 

retarded/developmental disability services waiver. 

� Allow states to tighten institutional eligibility for hospitals and ICFs/MR without 

simultaneously narrowing home- and community-based waiver services eligibility 

� Allow states to restrict the disregard of income or resources to people who are 

eligible for home- and community-based waiver services without applying the 

disregard to an entire eligibility group, thus giving the state more flexibility in 

administering its Medicaid program. 

� Provide guidance to the states to ensure continuity of health coverage for 

Medicaid-eligible persons in Institutions for Mental Diseases (IMDs) or 

correctional facilities to ensure that states do not let those persons’ Medicaid 

eligibility lapse merely because federal financial participation under Medicaid is 

not available in those facilities.251 

HHS also promised to establish a time-limited advisory committee, the Medicaid Community 

Services Reform Task Force, to be composed of representatives of “all age and target groups 

within the disability community,” organizational representatives, and government associations to 

“advise CMS on other actions that may be advisable to remove barriers and promote community 

251U.S. Department of Health and Human Services, Self-Evaluation to Promote 

Community Living for People with Disabilities (March, 2002) at III-25–26. 

110

living.” The role of the Task Force would be to consider improvements to state plan services; 

consider when family caregivers, spouses, and children would be cost-effective; improve 

coordination between state Title XIX agencies and other agencies; improve methods of 

contracting for services and service delivery to promote person-centered planning, peer 

mentoring, support coordination, individualized budgeting, and consumer direction of services. 

Not included in its charge was consideration of statutory changes that would remove the Title 

XIX institutional bias.

252 

To consumers of mental health services, HHS promised to “issue technical assistance and 

guidance to improve states’ understanding of their existing options” under Medicaid waivers.253 

Of course, these options are limited to waiver services for children and adults older than 64 

because younger adults cannot be served in the home- and community-based waiver. Nor did the 

report address the lack of Medicaid funding for home- and community-based long-term support 

for people with mental illness. In a 2001 report addressing barriers to community integration for 

persons with mental illness, SAMHSA had recommended establishing such an option,254 but this 

recommendation was ignored. 

On a subject of great concern to persons with significant disabilities for whom state Nurse 

Practice Acts are a barrier to receiving health-related services in the community, HHS promised 

to “work with states to advance methods” under which delegation of nursing tasks under 

Medicaid can be achieved, a commitment that stops short of removing the barrier itself.255 

252Id. at III-27–28. 

253Id. at III-28. 

254Bianco et al., Overcoming Barriers to Community Integration for Persons with Mental 

Illness (SAMHSA, 2001) at 32–33. 

255U.S. Department of Health and Human Services, Self-Evaluation to Promote 

Community Living for People with Disabilities (March, 2002) at III-29. Nurse Practice Acts 

111

HHS promised to provide simplified model waivers to permit states to offer self-directed services 

and support for informal caregivers, and it also promised to seek authorization from Congress to 

conduct a 10-year demonstration of respite services for family caregivers.256 On May 9, 2002, 

CMS released two template applications that states may use to simplify their requests for § 1115 

demonstration waivers to provide consumer and family-directed services. Because CMS was 

already granting § 1115 applications for self-determination waivers, the templates do not create a 

new program or benefit but merely streamline the application process.257 

HHS proposed a statutory change to create a state option enabling presumptive Medicaid 

eligibility for people determined to need a nursing facility or ICF/MR level of care who are being 

discharged from hospitals or other institutions to the community. Another statutory improvement 

would authorize a 10-year home- and community-based services demonstration as an alternative 

to Medicaid-funded psychiatric residential treatment centers for children. 

HHS also promised to establish an Office on Disability and Community Integration. The agency 

proposed to develop a strategy for addressing quality-of-care issues in home- and communitybased services that includes establishing defined expectations for home- and community-based 

services, assisting states to use results of HHS quality reviews of community placements, 

require that certain nursing tasks, such as catheter insertion or ventilator and tracheostomy 

management, be performed by a registered nurse, which significantly raises the cost of homeand community-based personal assistance services and reduces the number of people with 

disabilities who can be served under home- and community-based waivers. In states such as 

Kansas, in which Nurse Practice Acts have been amended to allow “delegation” of nursing tasks 

to personal assistants, people with significant health care needs are able to direct their own 

services in the community at a substantial savings to the state. Mary Johnson, “In Thrall to the 

Medical Model,” Ragged Edge (January–February, 1999). 

256U.S. Department of Health and Human Services, Self-Evaluation to Promote 

Community Living for People with Disabilities (March 2002) at III-35–36. 

257HHS Letter to State Medicaid Directors, May 9, 2002. 

112

providing technical assistance to states and HHS regional staff in effective systems design or 

quality improvement strategies, and implementing new quality assurance and improvement 

systems suited for in-home services. 

HHS promised to review the discharge planning policies of institutions participating in Medicare 

and Medical Assistance to ensure that these institutions provide more effective discharge 

planning for adequate and appropriate community-based care. 

HHS also promised that a plan to achieve appropriate community-based services for youth with 

special health care needs would be developed and implemented. The only increased funding for 

community services HHS promised was the initial $70 million in Systems Change grants for 

community living plus an additional $55 million to be allocated in FY 2002. 

The HHS report acknowledged in written comments and at the National Listening Session, 

“Institutional bias in Medicaid was identified as a major barrier by HHS components and all 

stakeholder groups including state and local governments.” Of the groups that commented, 

approximately 35 percent of the consumers, 45 percent of the providers, 52 percent of the 

advocacy organizations, and 75 percent of the governmental interests identified Medicaid 

structure and financing as a major barrier to community living.

258 HHS framed the solutions it 

proposed in the March 2002 report as measures to address the institutional bias of Medicaid. 

However, those recommendations plainly ignored the root cause of the institutional bias: the fact 

that participating states are required to provide nursing facility services and, for states that have 

opted into the ICF/MR program—as all the states have—institutional services for persons with 

developmental disabilities. The states are given broad discretion to design the home- and 

community-based services and personal care services they will provide, and indeed they have 

discretion as to whether to provide those services at all. HHS also did not propose to eliminate or 

258Id. at A-53–54. 

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reduce the differences in eligibility requirements for institutional and community services that 

create an incentive for institutionalization. In the report, the Administration did not commit to 

seeking the statutory change in Title XIX that will be necessary to remove these barriers. The 

closest it came was the weak promise that “CMS will work with states and other stakeholders to 

consider statutory changes to establish a state plan option for comprehensive HCBS.”259 

(b) Housing 

The final report acknowledged that federal housing programs have many barriers to community 

integration of persons with disabilities including the following: 

� Insufficient supply of affordable and accessible housing. 

� The status of private housing providers as “contractors” rather than “recipients” of 

federal funds so they are not required to ensure the accessibility of their services. 

� HUD 504 regulations on homeownership that are ignored by HUD offices because 

they refer only to programs that no longer exist. 

� Lack of full use of the Federal Housing Administration’s (FHA’s) Title I and 

203(k) programs to finance accessibility modifications because eligibility for 

these programs requires that rehabilitation costs be at least $5,000. 

� Lack of flexibility within the Section 811 Supportive Housing program to develop 

more integrated housing with fewer supportive services. 

� Unavailability of funds for move-in expenses, deposits, and household items for 

Section 8 voucher recipients. 

� Absence of data collection requirements that would enable HUD’s Office of 

Public and Indian Housing to know whether vouchers targeted for persons with 

disabilities under the Mainstream, Certain Developments, Designated Housing, 

259Id. at III-30. 

114

and targeted Fair Share vouchers, in fact, have been issued to families with 

disabilities. 

� Failure of some PHAs to request an adequate number of vouchers to meet the 

housing needs of nonelderly disabled families or to designate accessible units as 

“elderly only.” 

� Shortage of “visitable” units in public housing developments caused by lack of 

technical knowledge on the part of PHAs and their engineering and architectural 

consultants. 

� Lack of enforcement of Section 504 and the Fair Housing Act of 1988 at the 

design review stage of construction of new public housing to ensure 

accessibility.

260 

Apart from a commitment to update the HUD Section 504 regulation and to require a 

standardized certification on construction drawings for federally funded public housing projects 

of the number and percentage of accessible units meeting Section 504 and Fair Housing Act 

requirements as well as a proposal to amend Section 811, the actions the federal agencies 

proposed to address these barriers consist primarily of information and technical assistance to 

PHAs and seem unlikely to result in a significant expansion of affordable housing. 

The HUD report does not mention the Section 232 program, by which HUD guarantees loans to 

nursing facilities, assisted living facilities, and other congregate facilities. According to a report 

from ADAPT, HUD paid out $174 million in 2001 for defaulted loans to nursing facilities and 

$27.6 million to assisted living facilities, some very large in size. Rather than foreclose on the 

properties and sell them, HUD set up a workgroup with the American Health Care Association 

and other “stakeholders” to study the problem.261 

260U.S. Department of Housing and Urban Development, Self-Evaluation to Promote 

Community Living for People with Disabilities (March 2002) at 7–14. 

261ADAPT, “Another HUD Outrage: Over $200 Million Spent on Nursing Home 

Developers in 2001” (June 1, 2002). Nursing and assisted living facilities with a minimum of 20 

115

To expand the use of Section 8 vouchers, HUD promised to provide technical assistance to local 

PHAs and “strongly encourage” them to consult with disability organizations. HUD also 

promised to issue notices to PHAs and to Community Development Block Grant (CDBG) 

grantees explaining the implications of the Olmstead decision. HUD promised to work with the 

Department of Justice (DOJ) on investigations and enforcement of developers’ obligations under 

the accessibility provisions of the Fair Housing Act. (No private right of action exists under these 

provisions, and thus the United States is responsible for enforcing them.) Actions proposed by 

other federal agencies (the Departments of Labor, Education, Justice, and Health and Human 

Services) consisted primarily of interagency collaboration to identify strategies to increase access 

to housing by people with disabilities. 

(c) Personal Assistance, Direct Care Services, and Community Workers 

The reports acknowledged that very low pay and lack of benefits has caused the critical shortage 

of personal assistants and community care workers. The principal response, however, was the 

proposal of the Department of Labor (DOL) to develop a cross-agency/cross-department federal 

plan “to increase the availability and quality of personal assistants, and to identify options for the 

education, training and career advancement for personal assistants and other direct care staff and 

community service workers.” DOL also promised to establish an online registry and to assess the 

impact on the availability of personal assistance services of the exemptions within the Fair Labor 

Standards Act’s (FLSA’s) minimum wage and overtime exemptions for companionship and livein services.

262 Although an online registry and repeal of the companionship exemption in the 

beds are eligible under the Federal Housing Administration (FHA) Section 232 program for 

loans for new construction or substantial rehabilitation. Section 232 loans offer lower interest 

rates than conventional mortgages, and can include funds used to market the facility to 

prospective residents in the mortgage amount. “Securing FHA Loans,” Provider (January 1998). 

262U.S. Department of Labor, Self-Evaluation to Promote Community Living for People 

with Disabilities (March 2002) at III-B. 

116

FLSA will be helpful, these actions fall far short of addressing the extremely low pay of personal 

assistants, which is the acknowledged cause of the labor problem. 

HHS promised to address workforce shortages by initiating a national demonstration to test the 

impact of better coordination with the Temporary Assistance for Needy Families (TANF) 

program and the availability of vouchers for workers to purchase affordable group health 

coverage. HHS also promised to make available to states a coherent body of information about 

methods to address worker shortage issues, research these issues, and collaborate with 

foundations, the private sector, the DOL, and other agencies to “formulate a comprehensive 

approach to the worker issue.”263 These actions, again, do not directly address the pay issue. 

ED’s Rehabilitation Services Administration (RSA) promised to explore how funds for personal 

assistance services could become more “consumer driven.” Because the concept of consumerdriven personal assistance services has already been widely demonstrated and evaluated and is 

being funded with Medicaid dollars, this exploration seems unlikely to result in change. 

(d) Caregiver and Family Support 

HHS promised to provide states with a simplified model waiver form for caregiver support and 

to seek authority to conduct a national respite care demonstrations for caregivers of adults and 

children.264 

263U.S. Department of Health and Human Services, Self-Evaluation to Promote 

Community Living for People with Disabilities (March 2002) at III-33–34. 

264Id. at III-38. 

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(e) Transportation 

The Department of Transportation (DOT) promised to renew its FY 2002 budget request, which 

was not funded, for $145 million to establish two grant programs to promote innovative 

transportation solutions for people with disabilities. These programs would fund communitybased organizations, nonprofits, and transportation providers to expand transportation options. 

DOT also stated that it is considering a number of proposed regulations to enhance the 

accessibility of aircraft and the safety standards for motor vehicles.265 

DOT and several other federal agencies (DOL, ED, DOJ, and HHS) promised to collaborate with 

other agencies to encourage integration of transportation and other services. DOT promised to 

revitalize the joint DOT/HHS Council on Access and Mobility,

266 and DOJ promised to look for 

opportunities to participate as an amicus curiae in private lawsuits concerning accessible 

transportation. 

(f) Employment 

DOL acknowledged the “urgent need to increase the availability of customized employment” 

(i.e., supported employment) to enable people with significant disabilities to work. To that end, 

DOL promised to initiate an Olmstead Community Employment Initiative, a coordinated strategy 

to “ensure that all DOL policies and activities fully address the employment and training needs of 

people with disabilities who are at risk of institutionalization” or are moving from institutions to 

the community. DOL also promised to award Olmstead Community Employment Planning and 

Implementation grants to states that include an employment focus for people with disabilities in 

265U.S. Department of Transportation, Self-Evaluation to Promote Community Living for 

People with Disabilities (March 2002) at 31. 

266Id. at 36–38. 

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their Olmstead state plans and activities and that coordinate “employment and related supports” 

at the state and local level. The grantees will be consortia of nonprofit advocacy or service 

agencies and Local Workforce Investment Boards; their activities will focus on increased 

capacity, coordination, and feedback to DOL on effective Olmstead implementation strategies. 

However, the administration requested only $8.3 million to fund these grants in FY 2002. The 

FY 2002 budget also proposes an additional $6 million to expand the Customized Employment 

Grant initiative from seven to 17 sites. These amounts are minuscule in comparison with the 

funding for traditional VR services.267 

Additional DOL activities promised in the preliminary and final reports included research and 

demonstration of promising practices to increase employment and successful transition from 

school to work, the convening of a Youth Advisory Committee, training and technical assistance, 

and expansion of grants to enable Local Workforce Investment Boards to systematically review 

their policies. DOL promised to develop and implement an action plan to promote selfemployment and small business development among people with disabilities, including those 

who wish to return to their communities from institutions.268 

The RSA of ED promised assistance and coordination to help state VR agencies improve 

transition from school to work. RSA also promised to enforce actively the VR regulation that 

eliminates extended evaluation as a final employment outcome and to ensure that an employment 

outcome is counted only for a person with a disability who is working in an integrated setting in 

the community. However, fundamental reform of the VR program to address the barriers it 

presents to persons with significant disabilities who seek employment were not addressed. 

267U.S. Department of Labor, Self-Evaluation to Promote Community Living for People 

with Disabilities (March 2002) at III-8–13. 

268Id. at III-14–23. 

119

HHS promised to work with other federal agencies to develop strategies on employment issues. 

OPM proposed to disseminate information about hiring, retaining, and working with persons 

with disabilities and to facilitate “telework.” OPM also proposed to revise its guidelines to make 

it easier for persons with disabilities to apply for federal employment. 

The Social Security Administration (SSA), the agency responsible for implementing the Ticket to 

Work and Self-Sufficiency Program, promised aggressive implementation of that program. SSA 

also promised to expand its corps of employment support representatives specially trained to both 

assist SSDI and SSI beneficiaries to work and conduct research and demonstration projects to 

encourage employment of persons receiving SSDI and SSI. 

(g) Veterans 

The Department of Veterans Affairs (VA) promised to consider expanding its authority to pay for 

assisted living or board and care home services after the evaluation of a pilot program authorized 

by P.L. 106-117 for VA-paid assisted living. Currently, this is the only exception to the statutory 

rule that allows VA to pay only for nursing facility services. VA also promised to require its 

outpatient clinics to submit plans for the provision of mental health services. At present, some 

clinics do not offer basic mental health services. VA also promised to evaluate and consider 

expanding its adult day care, homemaker, and health aide program and to reduce its backlog of 

more than 661,000 claims. 

(h) Education 

ED and DOL made several commitments designed to improve educational outcomes for students 

and adults with disabilities by disseminating information, providing technical assistance and 

training, and enforcing transition planning requirements. Of greatest relevance to Olmstead 

implementation is the commitment of the ED to consider amendment of the provision of the Carl 

120

D. Perkins Vocational and Technical Education Act that allows vocational education funds to 

support state institutions for persons with disabilities. 

(i) Access to Technology 

DOL, ED, and HHS all promised to take steps to improve the availability, affordability, and 

accessibility of technology to people with disabilities. Except for DOL’s commitment to expand 

its DisabilityDirect.gov Web site to provide employment information, the agencies’ promises had 

little specificity beyond a commitment to plan. 

(j) Accountability and Legal Compliance 

DOJ, ED, DOL, HHS, and HUD all committed to increased enforcement, monitoring, and review 

of the implementation of federal legal mandates that protect persons with disabilities, including 

the ADA and, specifically, Olmstead-related claims, the Fair Housing Act, the Civil Rights of 

Institutionalized Persons Act (CRIPA), the Vocational Rehabilitation Act, and the Workforce 

Investment Act. The agencies also committed to provide technical assistance and information 

dissemination to enhance implementation of these federal statutes. 

(k) Public Awareness, Outreach, and Partnerships 

DOJ, ED, DOL, HHS, and HUD committed to conduct public awareness campaigns, education, 

training, outreach, and listening sessions and to develop informational materials, public service 

announcements, and improved lines of communication with people with disabilities all for the 

purpose of enhancing awareness of the rights of persons with disabilities, in particular, the rights 

articulated in the Olmstead decision. Of note is HHS’s commitment to establish a Disability 

Advisory Committee that includes all the constituencies described in Executive Order 13217 to 

review and advise HHS on the implementation of solutions to the problem of unnecessary 

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institutionalization and to provide information and advice to HHS on community integration 

issues.269 

(l) Income Supports 

The SSA committed to provide enhanced training to SSA staff, disability examiners, and 

administrative law judges in Olmstead-related issues. 

(m) Gathering, Assessment, and Use of Data 

DOJ, ED, DOL, HHS, and HUD made numerous commitments to collect data on the unmet 

needs of persons with disabilities, on efforts to meet those needs, on compliance with federal 

requirements, on promising practices, and on use of federal programs designed to assist persons 

with disabilities. 

(n) Cross-Agency Collaboration and Coordination 

Finally, DOJ, ED, DOL, HHS, and HUD made commitments to collaborate in workgroups and 

other partnerships to enhance access to housing, employment, and transportation. Of note was 

HHS’s proposal that the Interagency Council on Community Living convened by Secretary 

Thompson in July 2001 be authorized permanently and that the Council develop a strategic 

interagency plan to expand and promote home- and community-based services and to address 

housing, workers with disabilities, the long-term care workforce, assistance technology, 

transportation, and education. 

269U.S. Department of Health and Human Services, Self-Evaluation to Promote 

Community Living for People with Disabilities (March 2002) at III-41. 

122

 9. Conclusion 

A comparison of the barriers to community integration identified by people with disabilities in 

Chapter II with the actions proposed by federal agencies in “Delivering on the Promise” shows 

that major barriers, including the institutional bias of Medicaid funding, the severe shortage of 

affordable housing, and the low wages of personal assistants and direct support staff, will 

scarcely be affected by the proposed actions of the federal agencies. Whereas many of the actions 

proposed by the agencies will be helpful to people with disabilities and to states seeking to 

implement the Olmstead mandate, most of these activities seem likely to have only a marginal 

impact on service systems for people with disabilities. In many cases, the agencies’ proposed 

actions consisted of further demonstration of consumer-directed approaches to services whose 

efficacy has already been quite thoroughly demonstrated. 

In early 2003, the Bush Administration announced a five-year program beginning in 2004—the 

“Money Follows the Individual” Rebalancing Demonstration—to enable people with disabilities 

to move from institutions to the community. The program would provide for one-year 100 

percent federal funding for home- and community-based waiver services for a person leaving an 

institution, after which the state would agree to continue to provide services for the person at the 

regular Medicaid matching rate. The Administration will seek $350 million to fund the program 

in 2004, with $1.75 in proposed funding over a five-year period270. 

270U.S. Department of Health and Human Services, “President Will Propose $1.75 Billion 

Program to Help Transition Americans with Disabilities from Institutions to Community 

Living,” News Release (January 23, 2003). 

123

124

IV. 

The States’ Response to Olmstead v. L.C. 

This chapter summarizes the states’ overall progress in responding to Olmstead v. L.C. by 

analyzing the following on a state-by-state basis: the planning process; the progress the state has 

made in community integration since Olmstead v. L.C. was decided; and state “systems change” 

activities, that is, efforts to redesign the state service systems to enhance choice, independence, 

self-determination, and community integration. Collectively, these activities are indicators of the 

states’ overall compliance with Olmstead. More extensive information on the states’ experiences 

in the planning and implementation of the Olmstead decision is available in the electronic 

version of this report that is online at www.ncd.gov. 

Alabama is drafting an Olmstead plan, and the state has agreed to extend to nursing facility 

residents and those at risk of institutionalization the assessment procedures developed in a 2000 

settlement agreement in the long-running Wyatt litigation. However, neither the planning process 

nor Alabama’s systems change grants address the most significant barrier in the state’s long-term 

care system—the state’s failure to make more than modest use of federal funding opportunities 

for community services. 

Alaska has not formed an Olmstead planning group. Although the state’s institutional 

populations are small, the state has not responded to Olmstead by reducing institutional 

populations; indeed, the trend is in the opposite direction. 

Arizona is moving toward becoming an institution-free state. The vast majority—94 percent—of 

the state’s developmental disability long-term care funds are dedicated to home- and communitybased waiver services. Lack of providers and services in rural areas and lack of specialized 

providers even in urban areas are the most significant barriers to community integration. 

125

Arizona’s ratio of nursing facility beds to total population also is low, about half the national 

average. Lack of affordable, accessible housing is a significant barrier to moving out of a nursing 

facility; Maricopa County reports a two- to three-year wait for Section 8 housing. 

Arizona uses a wide variety of Medicaid options to serve persons with mental illness, including 

COBRA case management, the clinic option, the rehabilitation option, and the personal care 

option. The rate of long-term institutionalization in psychiatric hospitals is relatively low. 

Arizona’s Olmstead plan was released on August 27, 2001, and authored by the state Medicaid 

agency, the Department of Health Services, and the Department of Economic Security. The plan 

cites Olmstead planning as the state’s initiative. Each of the three agencies produced a draft in its 

own area; the state then sought comments on the plan and, to that end, convened four regional 

stakeholder meetings in August 2000. 

While the Arizona plan identifies some systemic barriers to community integration, it also has 

deficiencies. It lacks timelines, outcome benchmarks, or analysis of underlying problems. It does 

not commit to any specific plan for assessing nursing facility residents. It does not attend to the 

needs to expand housing and transportation services, a striking omission because both are major 

barriers to community integration. 

Because the plan lacks timelines or targets and focuses on marginal improvements in the 

community service system, it is not surprising that state officials report that their efforts to 

implement the plan are on target. 

Arkansas released a draft plan on October 14, 2002. It contains no timelines or numerical 

targets. Its only provision relevant to deinstitutionalization is to interview a random sample of 

about 300 persons living in Arkansas’ nursing facilities and ICFs/MR to identify individuals who 

would prefer to live in the community. These persons will then be referred to entities that can 

126

help them transition. The results of the survey will be used to determine whether a statistically 

significant percentage of institutional residents would choose to live in the community and 

whether an assessment of all institutional residents for their desire to move would be “costeffective.” This process will drastically limit the number of persons who will have opportunities 

to move to the community, especially from the Human Development Centers (the developmental 

disabilities institutions) and is inconsistent with Olmstead’s mandate to identify all persons who 

can handle and benefit from community placement, not simply those who can express an 

affirmative desire to do so. 

Although California represented to the National Council of State Legislatures in 2001 that its 

Long Term Care Council was serving as an Olmstead task force, the state, in fact, did not begin 

to develop an Olmstead plan until a cross-disability Olmstead coalition used pressure from 

litigation and from the legislature to force the state to begin planning in earnest. The state is now 

working on an Olmstead plan. 

In Colorado, four state agencies are developing their own Olmstead plans, which are to be 

combined into a single plan. 

Connecticut’s Olmstead planning process grew out of a long-term care planning process 

established by the legislature, housed in the state Medicaid agency, and intended to focus on the 

needs of elders. After the Olmstead decision came down, the agency broadened the planning 

committee by adding an advisory group, the Community Options Task Force, which included 

representatives of a broad spectrum of disability groups. The role of the Task Force was to 

provide advice to the long-term care planning committee and help develop an Olmstead plan. In 

2002, the long-term care planning committee published a document titled “Choices are for 

Everyone.” Funding for numerical targets and the many ambitious proposals to remove barriers 

to community integration suggested by members of the Community Options Task Force are not 

reflected in the plan because the Long Term Care Planning Committee refused to set measurable 

127

goals for community integration. Accordingly, the Community Options Task Force produced a 

Supplementary Report of its own that it presented to the governor. 

Delaware’s governor issued an executive order in May 2000 directing the state human services 

agency to develop an Olmstead plan. A change in administration derailed the plan, but advocates 

bypassed the administration in July 2002 by persuading the legislature to create a commission by 

House Resolution to assess and make recommendations on community-based alternatives for 

persons with disabilities. The state agency issued a hastily thrown-together document in October 

2002, proposing to place a small number of residents of the state’s developmental disabilities 

institution in the community, but lacking any placement goals or estimates of the number of 

persons with disabilities or elders who could leave institutions for the community. In March 

2003, the legislative Commission issued a report criticizing the dearth of community services in 

the state. 

The District of Columbia does not have an Olmstead plan. 

Although Florida’s institutional populations are large, they are around the national average 

measured on a per capita basis. The state maintains a large capacity of expensive psychiatric 

hospital beds. In the past 10 years, nursing home bed capacity has expanded significantly, 

whereas community services have not developed as extensively. 

Florida has not developed a formal Olmstead plan. Although Governor Jeb Bush has made 

expansion of community developmental disability services a priority, by early 2002 the waiting 

list of developmental disability services had grown to nearly 6,000 persons. In July 2002, a stateorganized coalition of officials and advocates, the Real Choices Coalition, published the Real 

Choices Partnership Work Plan for streamlining access to home- and community-based waivers 

and reviewing the progress of waiting lists. The document does not specify when a report will be 

completed or whether state agencies will be obligated to follow its recommendations. 

128

Georgia has been engaged in Olmstead planning since 1999, and its Planning Committee issued 

a Final Report and Recommendations in November 2001. However, the planning process is 

continuing. The Planning Committee set four goals: (1) transitioning people from institutions to 

the community; (2) diverting people presenting in the community from institutions; (3) building 

system and provider capacity; and (4) gaining commitment from the state to provide the 

resources needed to implement the plan. The plan is remarkably faithful to Olmstead; for 

example, the Planning Committee has recommended that the “universe” of people potential 

appropriate for community services be identified and that persons living in institutions receive 

one-on-one education and outreach from people who have been institutionalized themselves. 

In Hawaii, an Olmstead planning process was established by resolution of the state legislature 

and resulted in a five-year strategic plan to enhance services and support for people with 

developmental disabilities. The plan was also intended to respond to Makin v. Cayetano, a 

lawsuit on behalf of persons with developmental disabilities waiting for services. The plan does 

not address other populations. 

Idaho is developing a plan to enhance its community service system but has not set a target date 

for plan completion. 

Illinois is a heavily institutional state, ranking higher than all but five other states in its rate of 

institutionalization of persons with developmental disabilities in public and private facilities. For 

all persons with disabilities, nursing facilities are a major source of treatment and care; nearly 

three times as many persons live in nursing facilities as receive services under the home- and 

community-based waiver, and twice as many people with developmental disabilities live in 

ICFs/MR as live in home- and community-based programs. The state’s Medicaid expenditures 

are heavily slanted toward institutional spending, and Illinois is one of the lowest-ranking states 

in the nation in Medicaid spending for home- and community-based services. Illinois also spends 

129

a significant amount of state funds that could be matched with federal reimbursement, but the 

state has declined to request that. 

The initiative for Olmstead planning in Illinois began with enactment of HR 765 by the state 

legislature. The Act directed the Illinois Department of Human Services to ensure that services 

are provided in the most integrated setting. HHS established a Steering Committee of 224 

stakeholders in six working groups. The Committee released a report in December 2000, 

emphasizing it was not a “comprehensive, effectively working plan” but merely the first step in 

the process. 

The Steering Committee report, though comprehensive and thoughtful, is missing a commitment 

from the state. The Financing Work Group documented underuse of waiver slots and 

recommended expansion of Illinois’ seven waiver programs, removal of such barriers as financial 

eligibility requirements that limit participation, and assessment of people waiting for services. 

Other workgroups recommended increasing consumer choice of services, pursuing funding 

alternatives to promote integrated housing, removing institutional bias from state funding and 

payment systems, ensuring that money follows the individual and that transitional services are 

available for people who want to leave institutions, and pursuing best practices, such as selfdetermination and cash and counseling. 

Using the Steering Committee report as a guide, Illinois released its “Community Living and 

Disabilities Plan” in April 2002, containing submissions from the state agencies responsible for 

disability services, housing, and Medicaid. The plan is not a plan but merely a defense of existing 

policies and practices. It contains no analysis of Illinois’ compliance with Olmstead or of the 

actions that would be needed to achieve compliance. It is devoid of plans to reduce unnecessary 

institutionalization and proposes only about 200 community placements for the coming year, 

including emergency placements. Rather than analyze the need for additional community 

services, the Illinois plan defines the need in terms of the state’s level of effort. It is not 

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responsive to the Steering Committee recommendations and does not acknowledge the barriers to 

community integration identified by the Steering Committee. 

Indiana published the first edition of an Olmstead plan on June 1, 2001, articulating six 

progressive policy directives but providing extremely modest targets for reducing institutional 

populations. The plan contains no provision for assessing institutional residents. Reaction in 

public meetings around the state was highly critical of the plan. However, the Governor’s 

Commission on Home- and Community-Based Services, appointed in July 2002, has made an 

exemplary effort to identify urgent needs for systemic change that can be addressed in the short 

term with little fiscal impact. In December 2002, the Commission published sixteen short-term 

recommendations addressing systemic barriers that in many state Olmstead planning efforts 

would simply be identified for further study and analysis. The Commission’s effort to prioritize 

activities that could begin immediately and at little short-term cost is exemplary and should serve 

as a model for other states. 

Iowa’s Olmstead plan, published in July 2001, commits the state to a relatively small number of 

significant initiatives that have the potential significantly to restructure the state’s service 

delivery systems: “Money Follows the Person,” “No Discrimination Because of Severity of 

Disability,” “Home Health Services Designed to Support Independence,” and “Support the Use 

of Paraprofessionals to Provide Comprehensive Personal Attendant Services.” 

Kansas does not have an Olmstead planning process. However, in 2000, two state agencies 

formed a cooperative project with ADAPT, called “Operation Escape,” in which ADAPT would 

design a program (with state agency approval) of information and referral. Members of ADAPT 

would go into facilities to provide information about services, assistance with moving out, 

advocacy, and follow-up. Thus far, the state’s planning efforts have not determined how many 

people are unnecessarily institutionalized nor set measurable targets for community placement. 

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Kentucky’s final Olmstead plan was published on December 11, 2002. It contains goals 

designed to ensure that people with disabilities are evaluated and determined eligible to receive 

services in the most integrated setting. The plan states that “Individuals with disabilities currently 

living in institutional settings who desire community services and for who[m] the treatment team 

has concluded that community placement is appropriate will be identified and plans will be 

developed as soon as is practicable and funds are available.” The qualification that the person 

must “desire” community services and that transition plans will not be developed until “funds are 

available” are inconsistent with Olmstead. 

In Louisiana, state officials originally had chosen not to develop an Olmstead plan. However, 

the advocacy of a cross-disability coalition called LaPOP and a meeting with representatives of 

the Office of Civil Rights attended by about 25 representatives of the disability community 

caused them to reconsider. As a result of LaPOP’s advocacy, legislation was passed in 2001 

establishing the Disability Services and Supports System Planning; however, no formal plan has 

been produced. 

Maine’s Olmstead planning process has been unusually broad and inclusive. In response to the 

first CMS letter, Commissioner Concannon of the Maine Department of Human Services, with the 

approval of the governor, invited several other state commissioners to develop a common response 

to the Olmstead decision. The workgroup was charged with answering the question, “How do we 

eliminate altogether the unnecessary institutionalization of persons with disabilities (in both state 

and private institutions)?” The group has made recommendations. Although they are not final, it 

appears that the workgroup has essentially put off to another day its original goal to identify “the 

number of waiting lists, the number of people on each list, what services they need in order to 

move to a less restrictive setting and a schedule for when those needs will be met.” 

In Maryland, former Governor Glendening issued an executive order on July 25, 2002, creating a 

Community Access Steering Committee (CASC) charged with developing “a comprehensive plan 

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to expand community access opportunities for a broad spectrum of individuals with disabilities.” A 

year later, the CASC issued recommendations to the governor. Shortly thereafter, a broad coalition 

of disability organizations published a response to the CASC report. The coalition charged, “The 

report does not move a single person nearer to freedom than they were prior to July 25, 2000, when 

the Governor issued his Executive Order.” The governor’s 2003 budget requested funding for only 

a handful of the CASC’s recommendations. Maryland’s new governor, Bob Ehrlich, has promised 

a radically different approach. A bill requiring that money follow the person has been introduced in 

the state legislature and passed the House in March 2003. 

In Massachusetts, after advocates for elders and persons with disabilities charged that the state 

was doing little or nothing to respond to Olmstead, the governor established an Olmstead 

Advisory Group and directed that an Olmstead plan be developed by an interagency Steering 

Committee and an Interagency Leadership Team composed of the secretaries or commissioners 

of several departments. On July 31, 2002, the first phase of the Olmstead plan, called Enhancing 

Community Based Services, was released. The document is basically a “plan to plan,” although it 

does outline steps that are logical and consistent with the HHS guidelines. For example, the plan 

calls for an inventory of people in institutions, to identify everyone who is in an institution or at 

risk of institutional placement and to determine how many people would like to leave the 

institution or could leave if they had adequate support and if funds could be redirected toward 

their support. The next phase of the planning process is to develop a budget proposal for the 

coming fiscal year. 

Michigan is one of the most advanced of the large states in community integration. Apart from 

the large number of persons with developmental disabilities in nursing facilities, nearly every 

person in the state with developmental disabilities receiving out-of-home care is served in a 

community-based setting. However, Michigan’s spending on nursing facility services is 

substantial, and the number of nursing facility beds per 1,000 people in the state significantly 

exceeds the national average. 

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Michigan has not developed a formal Olmstead plan. In June 2000 the Department of 

Community Health issued a report titled “Long Term Care Innovations: Challenges and 

Solutions.” The workgroup that produced the plan consisted of state officials; no one from the 

disability community participated. The report does not purport to be an Olmstead plan, but it 

does reference Olmstead, and some of its recommendations are relevant to Olmstead compliance, 

for example, its endorsement of person-centered planning, community integration, and measures 

to improve recruitment and retention of direct care staff. However, the recommendations are 

fairly general and nonspecific. 

Although Minnesota is not developing an Olmstead plan designated as such, the Department of 

Human Services produced a report to the Minnesota legislature in February 2002 that addressed 

several Olmstead themes, though only in the context of services for elders. The report, “Keeping 

the Vision: Report to the Minnesota Legislature, Progress in Reshaping Long-Term Care in 

Minnesota,” was a response to long-term care legislation enacted in 2001, the purpose of which 

was to reduce the state’s reliance on institutional services and expand the availability of homeand community-based options. 

Mississippi’s service systems are characterized by a heavy institutional bias and low level of 

fiscal effort for community services. In developmental disabilities, Mississippi ranks 47th in the 

nation in community fiscal effort and 50th in the nation in its use of the home- and communitybased waiver. Between 1990 and 2000, the number of persons with developmental disabilities 

living in congregate settings actually increased by almost 30 percent. Community services rely 

heavily on large, state-operated group homes. Mental health services are also heavily institutional 

and coercive. Prior to development of the state’s Olmstead plan, Mississippi offered few services 

for elders and persons with physical disabilities other than nursing facility care, and spending per 

elderly beneficiary for long-term care was the lowest in the nation. People waiting for services 

under the Aged and Disabled waiver are placed on waiting lists simply to be evaluated. In the 

five years prior to Olmstead plan development, Medicaid expenditures on nursing facilities rose 

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by 42 percent and Medicaid home care expenditures declined by 22 percent. Unlike most states 

in which housing is the biggest barrier to community integration, Mississippi stakeholders view 

lack of transportation as the major barrier. 

In June 2000, the governor appointed the Division of Medicaid as the lead agency for Olmstead 

planning with the participation of other state agencies. Eventually, consumers and other 

stakeholders were invited to join the discussions under the rubric of a coalition called Mississippi 

Access to Care. The stakeholder group was relatively inclusive, although elders were 

underrepresented. 

The coalition collected data for the planning effort by distributing a statewide survey to identify 

needs and services available and by holding a series of public meetings. Although advocates did 

not regard the input process as particularly effective, it was used to develop common 

themes—consumer education, database development, housing, population identification, 

simplification and standardization, transition, and transportation—that formed the basis for 

workgroups to develop the plan. 

In March 2001, the legislature formalized the planning process by enacting legislation that 

mandates the development of a comprehensive plan. The act requires that the plan include an 

estimate of the number of people who need services, the appropriations that will be necessary to 

provide these services, and a goal that the state will have community services available to all 

persons with disabilities for whom those services are required. 

The plan was submitted to the state legislature in September 2001. A unique feature of the plan, 

and the reason it is widely considered an exemplar for other states, is that implementation of each 

planning goal is costed out over a 10-year period so that the plan can be incorporated into 

budgets and legislative appropriations. The plan also includes numerical targets for increasing the 

number of persons served in the community, although it is impossible to tell whether the increase 

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would meet the demand for home- and community-based services among persons who are 

institutionalized. The plan combines goals for the creation of community services with goals for 

meeting the state’s obligations under a variety of federal statutes that have only a tangential 

relationship to Olmstead. 

As of March 2003, the Mississippi plan has not been implemented. Nonimplementation is 

attributed to shortfalls in the state Medicaid budget. However, even the provisions in the plan 

that would not require additional funding, such as the single point-of-entry requirement, are not 

being implemented. 

The plan does not identify cost savings that could be achieved by reducing institutionalization, 

nor does it call for redirecting funds from nursing facilities. Advocates have called the document 

a “bricks and mortar” plan—a plan to build new facilities. It contains no requirement that people 

who could handle and benefit from community living be identified, let alone that they be able to 

move to the community at a reasonable pace. The planning group was unable to reach consensus 

on the changes in assessments of institutional residents that would need to occur to achieve 

compliance with Olmstead. Rather than a goal of identifying all institutional residents who could 

handle and benefit from community living, the plan proposes only to “advise” nursing facility 

residents of the availability of community services. The needs of persons with mental illness are 

virtually unaddressed in the plan. The plan does contain promising strategies for increasing the 

supply of accessible, affordable housing, for example, training case managers in housing 

facilitation and adding home modifications to the menu of waiver services. 

In May 2002, the Mississippi Coalition of Disabilities filed a lawsuit, Billy A. v. Lewis-Payton, 

on behalf of persons segregated in nursing facilities who could be living in the community if they 

had adequate support. That this lawsuit was necessary shows that even an Olmstead plan that is 

widely regarded as “the best of the best” cannot succeed in the absence of resolve on the part of 

the state to ensure that waiting lists do in fact move at a reasonable pace. 

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Missouri’s Olmstead plan is widely regarded as a model. The plan describes existing programs, 

participants, and existing funding; discusses and makes recommendations concerning 

development of outcome assessment tools; identifies the number of institutionalized people with 

disabilities in the state; and identifies the number of waiting lists for services, identifies the 

number of people on them, and analyzes the pace at which the lists move. It examines whether 

the available information on community services is adequate for people to make informed 

choices. The plan recommends changes in Missouri’s service system in seven areas: consumerdirected personal care assistance, housing, interagency coordination, Medicaid services, funding 

mechanisms, transportation, and employment opportunities for people with disabilities. Specific 

recommendations include increasing availability of personal care assistant services and 

increasing their wages and increasing funding for accessible, affordable housing. The plan 

contains timelines for various actions and agencies responsible for those actions during fiscal 

years 2001 and 2002. However, in some respects, the plan fell short of recommendations made 

by advocates, including the proposal that by December 1, 2000, assessments would be completed 

and the state would have a list of the names and locations of persons who want to move to the 

community and the specific types of support, in hours and funding sources, they need to live in 

the community. The final plan does not require that institutional residents who could move from 

institutions actually be identified and provided with opportunities to move. 

In response to Olmstead, the Montana Department of Public Health and Human Services has 

issued two task force reports, one from the Senior and Long Term Care Division, the other from 

the Disability Services Division. The former plan has a goal to “increase availability of all 

community services” and an objective of developing a legislative proposal to increase funding 

for community services, but it sets no goals and contains no specific proposal for increased 

funding. The Disability Services Division’s Biennial Work Place for 2001–2003 calls for 

developing up to three new community residential homes to allow 12 persons to move from 

Montana’s developmental disabilities institutions. The plan suggests that more than 12 persons 

have been recommended for community placement but acknowledges that the state agency “does 

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not have adequate appropriations from the 2001 Legislature by which to initiate an expansion of 

community service opportunities.” 

Nebraska does not have an Olmstead planning process or task force. 

During the 1990s, Nevada was the fastest-growing state in the nation, yet spent relatively little 

on disability services. Out-of-home placement rates are low, and a significant number of nursing 

home and ICF/MR residents are in out-of-state placements. 

Nevada’s Olmstead planning process began with a legislative mandate enacted in July 2001, 

followed by public hearings on how the plan should be developed. Compared with Olmstead 

planning committees in other states, Nevada’s contained few state officials. Instead, Nevada 

relied heavily on expert national consultants. 

The Nevada Strategic Plan for People with Disabilities is comprehensive and paints an in-depth, 

if bleak, analysis of Nevada’s current compliance with Olmstead. The plan finds that Nevada has 

undercounted the number of people waiting for services and that more and more people are 

exiting special education that will need services. To avoid unnecessary institutionalization, the 

plan recommends setting neutral assessment, allowing money to follow the person, and ensuring 

that any Medicaid-funded nursing facility resident be eligible for state-funded community 

services. 

New Hampshire was the first state in the nation, in 1991, to close its state developmental 

disabilities institution, and it has continued to make progress toward community integration since 

that time. The self-determination model pioneered by Monadnock Developmental Services has 

been adopted statewide, giving consumers control—with the assistance of circles of support and 

fiscal intermediaries—of the Medicaid dollars that fund their services. The number of nursing 

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facility residents is slowly decreasing, but the state is still well above average in the number of 

nursing facility residents as a percentage of all persons age 65 and older. 

New Hampshire has assertively applied for federal grant programs to transition nursing facility 

residents to the community. At the same time, however, by restricting the cost of home-based 

care to one-third the average cost of home-based care and by requiring separate budget line-items 

for nursing facility and home-based care, a state law enacted in 1998 presents significant barriers 

to nursing facility residents who wish to move to the community. 

New Hampshire does not have a formal Olmstead planning process. Legislation enacted in 2002 

established a legislative committee to review community services for elders and persons with 

disabilities. 

The impetus for New Jersey’s Olmstead planning process came from New Jersey Protection 

and Advocacy, Inc., which convened an ADA coalition composed of 90 organizations and 

developed a set of principles for an Olmstead plan. The coalition persuaded Governor Whitman 

and the New Jersey Department of Human Services (DHS) to convene an Olmstead 

Stakeholder’s Task Force in November 2000. However, the plan drafted by DHS does not 

include the action steps proposed by the Coalition for identifying institutionalized persons who 

would like to live in the community, the costs associated with institutional living, the services 

that currently exist, and the recommended changes, nor does the plan contain measurable 

outcomes, target dates, or provisions for monitoring and quality assurance. Predating 

Olmstead, DHS conducted another planning effort, Redirection II, to improve mental health 

services both in institutions and the community. As a result of independent assessments, the 

planning group concluded that 388 persons could be receiving services and support in 

alternative settings and that the hospital beds currently being used to house these persons could 

eventually be taken off-line. Unfortunately, however, the plan contemplates that at least some 

of the 388 persons would move to nursing facilities, residential health care facilities, and group 

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homes. Redirection II was not coordinated with development of the Olmstead plan, although it 

does contain many elements of an Olmstead plan. 

In New Mexico, the state senate requested that the state Department of Health and the Human 

Services Department develop an Olmstead plan and recommended that the state’s plan include 

assessing people who are at risk of institutionalization and addressing systemic and infrastructure 

barriers to community living, including the personal care attendant and nursing aide shortage and 

the lack of accessible, affordable community-based housing. In the next legislative session, the 

state senate again passed a resolution that a task force be created under the direction of the 

Governor’s Committee on the Concerns of the Handicapped to develop a comprehensive, 

coordinated state plan in response to Olmstead and to report its findings to the Legislative 

Finance Committee in October 2002. In response, the Department of Health and the Human 

Services Department held an Olmstead meeting where, according to advocates, they simply 

stated what they were doing. In June 2002, an official of the Long Term Care Division of the 

New Mexico Department of Health reported that the Department had decided that it “has no 

Olmstead exposure because the DOH was far ahead of Olmstead with respect to communitybased care” yet acknowledged that the state does not have adequate community services for 

persons with chronic mental illness. 

New York has radically reduced the number of persons with developmental disabilities living in 

state institutions, but this has not always been matched by the development of community 

services. The number of nursing facility beds has grown steadily, and the number of persons with 

developmental disabilities housed in nursing facilities has grown significantly since 1996. Large 

group homes are so common that only 39 percent of people with developmental disabilities live 

in homes of six or under, and the number of people waiting for services is large. On the other 

hand, New York has a large and well-resourced personal care program compared with those of 

other states, and New York leads the nation in drawing down the most Medicaid dollars as a 

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percentage of its total community spending. But it has not fully addressed the scarcity of 

accessible, affordable housing. 

New York has not yet developed an Olmstead plan, although in September 2002, the governor 

signed into law a bill to establish a Most Integrated Setting Program. The act requires the 

Department of Health to identify nursing facility residents who could live in a “most integrated 

setting” and calls for a coordinating council composed, in part, of people with disabilities. The 

bill was introduced in February 2001 but was not passed by the legislature until June 2002, when 

hundreds of advocates from ADAPT orchestrated a sit-in to bring the bill out of committee and 

to a vote. Even then, it took three more months and another sit-in before it was signed into law. 

The act has not been implemented, and the governor has introduced a bill that would weaken the 

Most Integrated Setting legislation by weakening the role of the coordinating counsel, the data 

collection requirements, and the implementation mandates. 

North Carolina began to develop its Olmstead plan in 2000. Concurrently, the state engaged in 

another planning process. The core of the state’s draft Olmstead plan is a process for identifying 

current institutional residents for potential community placement. Once identified, an 

individualized plan will be developed for each individual. Unfortunately, the process for 

identifying institutional residents for community placement in the North Carolina plan is 

thoroughly inconsistent with Olmstead and with North Carolina’s own extensive experience with 

implementation of a pre-Olmstead class action suit, Thomas S. v. Flaherty, because the plan 

provides that assessment for transition will occur only after the person has expressed a 

preference for community placement. 

In North Dakota, after HHS issued its first letter to state Medicaid directors, the director of the 

Department of Human Services appointed an internal workgroup to review the Olmstead 

decision and recommend further action. People with disabilities were not included but formed 

their own workgroup. The internal workgroup issued a White Paper that was intended not as a 

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plan but as a set of recommendations for further action. In August 2001, the governor issued an 

executive order establishing an Olmstead commission to develop a plan to include 

representatives of the disability groups that had asked to participate; however, only three 

advocates actually were appointed. In 2002, the Commission held focus groups sessions around 

the state. 

Ohio’s plan is widely regarded as a model for other states. Planning began in June 2000, when 

Governor Taft instructed his Office of Budget and Management to coordinate a review of state 

service systems with other state agencies. The resulting plan was published on February 28, 

2001. It addresses most of the components of Olmstead planning recommended by HHS. Despite 

its strengths, however, the plan does not address the pace of transition from institutions to 

community living or off waiting lists, does not set timelines for movement, and does not look at 

the adequacy of the state’s current system of assessing institutional residents. 

In Oklahoma, in February 2000, the Oklahoma Health Care Authority (OHCA) began a series of 

public meetings and workgroup meetings to obtain stakeholders’ views of the service delivery 

system and identify where “reasonable modifications” to existing programs were needed and 

could be made. Following the first two Olmstead public meetings, an Olmstead Work Group 

began meeting monthly at OHCA. The Summary Report of the Working Group, even in its 

fourth draft, is little more than a “plan to plan.” It became clear to the consumers and advocates 

in the workgroup that the planning process had progressed as far as it could go without a much 

more substantial commitment from the state. Advocates next obtained a legislative mandate for 

Olmstead planning, which became law in May 2002, and planning began again. Legislation 

authorizes planning to continue until 2005, with annual reports on the planning group’s progress. 

In Oregon, the strongest impetus for Olmstead planning came from mental health advocates, and 

the resulting plan—the Oregon Olmstead Workgroup’s report—although limited to a small 

number of mental health consumers, is a model Olmstead plan in many significant respects. It 

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identifies with specificity the people recommended for placement and the services they will need 

in the community, examines the adequacy of the discharge process, considers the adequacy of 

existing services and the changes needed to make those services responsive to the needs of 

consumers, and projects the costs that will be associated with transition. 

In Pennsylvania, 16 advocacy organizations joined in a letter of March 21, 2000, to the 

Secretary of Public Welfare urging her to develop and implement an Olmstead plan to provide 

effective community-based services to people remaining in state developmental disabilities 

institutions; to continue planning for community mental illness services with additional input 

from consumers and family members; and to convene a nursing facility planning process with 

significant, diverse consumer involvement. The signatories were an unusually broad coalition of 

disability and elders’ organizations. The advocates convened a meeting in April 2000 to discuss 

how the process for developing community services for nursing facility residents should proceed. 

However, the request was ignored, and no Olmstead planning has occurred. 

Rhode Island does not have a comprehensive Olmstead planning process, although it did obtain 

a grant from SAMHSA to develop a plan to move children with mental illness to less restrictive 

settings. The planning process was carried out by a consumer organization, the Parent Support 

Network of Rhode Island, under contract with the state Department of Children, Youth and 

Families (DCYF). Although DCYF has not issued the plan, an intergovernmental task force 

chaired by two legislators—the Ideal System of Care Committee—published a plan in April 2002 

to reform children’s services more generally over the next five years. 

In South Carolina, Governor Hodges issued an executive order in November 2000 establishing 

the South Carolina Home and Community-Based Services Task Force and charging it with 

developing a comprehensive, effectively working plan for compliance with Olmstead. The Task 

Force was to conduct a review of all services available to people with “physical, mental or 

developmental disabilities” in South Carolina, analyze their availability and efficacy, identify 

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affected populations, improve the flow of information about support services in the community, 

and remove barriers that impeded community inclusion. The Task Force was to ensure the 

involvement of consumers, families, providers, and advocates and submit a report to the 

governor with specific recommendations for improvements in services and a timeline for 

implementation. A Task Force of 33 members issued a report in August 2001. Although the 

report lists the home- and community-based services available to people with disabilities in 

South Carolina and the numbers of persons waiting for services (but only for those services that 

maintained waiting lists), it does not really analyze the extent to which those services could be 

used to get people out of institutions. The plan commits the state to the principles of choice and 

self-determination, autonomy and consumer direction, flexibility, cultural sensitivity, 

empowerment, community integration, and access to activities and resources available to all. The 

plan sets a goal that all persons living in institutions who have indicated their desire to do so 

move to a community setting. Of course, this alone is insufficient. The plan recommends an 

independent assessment process but does not specify the number of residents who could move to 

other settings. 

South Dakota is not conducting any Olmstead-related activities. 

Tennessee does not have a formal Olmstead plan. The Tennessee Olmstead Coalition, a broadbased advocacy coalition has outlined the necessary components of a plan, organized planning 

workgroups and developed a comprehensive set of tasks needed to complete the plan. The 

Coalition has done an excellent job of organizing community support for Olmstead planning. 

However, the Coalition’s efforts have not been supported by the state, and without a working 

relationship with the state agencies with access to data or authority to collect it, it has been 

virtually impossible for the Coalition to collect the data needed to meet its own ambitious 

planning goals. 

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Texas has traditionally been a heavily institutional state and one characterized by low levels of 

Medicaid use and, in particular, low levels of family and in-home support. In 2000, it ranked 48th 

in the nation in the percentage of persons with developmental disabilities in community 

residential settings. Persons with physical disabilities fare somewhat better. Whereas more than 

87,000 people lived in nursing facilities in Texas in 2000, an equal number received services in 

Texas’s community-based personal care program. 

The Texas Olmstead plan, Promoting Independence, arose from an executive order by thenGovernor George W. Bush, directing the Texas Health and Human Services Commission to 

conduct a comprehensive review of all services to people with disabilities and remove barriers 

that impeded opportunities for community living. The Texas legislature then passed a bill 

requiring the development of a comprehensive, effectively working plan consistent with 

Olmstead. The planning group is an interagency task force that includes six advocates as well as 

eight representatives of state agencies. 

The two Promoting Independence plans are refreshingly free of platitudes about choice and 

independence. Instead, most Texas initiatives involve an examination of state funding 

mechanisms and how they can be modified to encourage community placement. 

Two initiatives make Texas unique in Olmstead planning. The first, Rider 37, is a modification 

to Texas’s method of funding nursing facilities. It allows the general revenue used to purchase 

nursing facility services to follow the individual into the community and purchase community 

services. A parallel initiative, Rider 7, allows the state to establish procedures for controlling the 

number of Medicaid beds and for the de-certification of unused Medicaid beds. These initiatives 

alleviate the concern expressed by the Supreme Court in Olmstead that states may have to 

maintain expensive institutional facilities while simultaneously paying to transfer people to the 

community. 

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Another unique aspect of Texas’ plan is that in includes children in foster care under the rubric of 

Olmstead planning on the ground that “the most integrated setting” for children is a permanent 

family. 

In Utah, the Olmstead planning process emerged in response to pressure from advocates. It was 

housed in the Governor’s Office of Planning and Budget, the Department of Health, and the 

Department of Human Services with participation by other agencies (notably, contributions by 

housing and transportation agencies are not reflected in the plan). The plan, issued on March 26, 

2002, addresses services for elders, adults with disabilities, children placed outside their home, 

people with mental illness, people with developmental disabilities, and youth in corrections 

facilities. 

The most obvious gaps in the Utah plan are its failure to include a census of institutions, to spell 

out the pace of movement from institutions to community, or to address waiting lists for 

community services. The plan does not contain measurable goals, timelines, and a list of concrete 

action steps. Rather, it describes generally the activities the state needs to undertake or continue 

to improve its service system, for example, “integrate self-determination concepts into the longterm care system.” The plan contains no timelines for assessments. 

In Vermont, a bill was signed into law in June 2002, establishing an Olmstead advisory 

commission in the Agency on Human Services on specifying the Commission’s membership. 

The Commission is to submit a status report on January 1 of each year to the governor and the 

legislature. 

Virginia is one of the last states to begin an Olmstead planning process. The state legislature 

mandated an Olmstead Task Force in the 2002 Appropriations Act; the group is to submit its 

final recommendations to the governor, the chair of the House Appropriations and Senate 

Finance Committees, and the chair of the Joint Commission on Health Care by August 31, 2003. 

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The Task Force is organized by disability populations, with a lead agency assigned to each, who 

will develop population-specific reports and Issues Teams, which will examine broad issues that 

cut across populations. An impressive range of population groups were proposed, including 

adults with mental illness; children with emotional disturbance; people with mental retardation; 

people suffering from substance abuse; people with Alzheimer’s/dementia, autism, physical 

disabilities, developmental disabilities, HIV/AIDS, and brain injuries; and people who are deaf, 

hard of hearing, or blind. On the basis of stakeholders’ identification of cross-cutting issues, 

seven Issues Teams were organized in the areas of accountability; educating the public, 

consumers, and families; employment; qualified providers; housing; prevention and transition 

services; and waivers. By October 2002, when the Task Force chair reported to the House 

Appropriations Committee on the status of the planning project, 14 state agencies were 

participating or providing resources to the Task Force, including the Departments of Aging, 

Health, Housing and Community Development, Medical Assistance, Rehabilitative Services, and 

the Housing Development Authority. Of note is that representatives of the Office of Civil Rights 

(OCR) of HHS attended the first meeting of the Task Force and presented OCR’s understanding 

of the elements of a comprehensive Olmstead plan. 

Washington falls squarely in the middle range of the states in rates of institutionalization and 

community integration. Unlike most states, however, it maintains a larger Adults with 

Disabilities waiver program for people with physical disabilities than its mentally 

retarded/developmentally disabled waiver. Still, Washington ranks 16th among the states in the 

percentage of citizens with developmental disabilities who are supported in settings of six or 

fewer persons, and its supported living program exceeds those of most states in size and 

expenditures. Its rate of institutionalization, including placement in nursing facilities, of persons 

with developmental disabilities is about average. 

During the 1990s, Washington bucked the national trend by decreasing the number of nursing 

facility beds by about 4 percent. The move to more cost-effective community-based alternatives 

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accelerated after 1994, when voters enacted Initiative 601, which limited annual growth of state 

expenditures to the combined rate of population growth and inflation. The state responded with a 

concerted effort to divert and relocate nursing facility residents with annual reduction targets for 

nursing facility caseloads. Case managers are assigned to specific facilities, assess residents 

within seven days of their entering a nursing facility, and decide whether the person should be an 

“active relocation client.” Case managers also have a flexible pot of money available from fine 

monies levied against nursing facilities in a Civil Penalty Fund. Washington is considered a 

leader among the states in using consumer-directed care. 

The state maintains three psychiatric hospitals and has no plans to close them. Washington 

finances its community mental health services, the Integrated Community Mental Health 

Program, through a full carve-out, stand-alone mental health and substance abuse Section 

1915(b) waiver combined with Title XX block grant and state funds. Fourteen county-based 

Regional Service Networks (RSNs) serve as Prepaid Health Plans and contract with Community 

Mental Health Centers for service delivery. The RSNs are designated by state statute as the single 

point of entry for service delivery. Wide disparity in service existed among the RSNs. 

To address lack of coordination between the services delivered by various state agencies, the 

state has promoted cross system teams and a “No Wrong Door” multiagency case coordination 

model. In response to the findings of a state legislative audit, Washington is implementing an 

Enhanced Community Services Project to help consumers with mental illness move to more 

integrated settings; stakeholders perceive this as a response to a legislative mandate rather than a 

response to Olmstead. 

Litigation brought by the state Protection & Advocacy system also has resulted in community 

placement of institutionalized persons with mental illness. 

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On March 27, 2000, Governor Gary Locke designated the Department of Social and Health 

Services as the lead agency for Olmstead planning. The planning process was tied to the state 

biennial budget cycle. The planners envisioned that in each phase, a set of plan activities would 

be developed, incorporated into the budget process, funded, and implemented. On the one hand, 

stakeholders criticized this approach as lacking in vision and long-term view. On the other hand, 

the planning process has been more comprehensive than that of most states (notably, it addresses 

transportation), and the connection to the budget process has maximized the probability that 

planning initiatives will be funded. 

In the first cycle, the 2001–2003 biennial budgets, a wide variety of state agencies each 

developed its own Olmstead plan. The Division of Developmental Disabilities undertook a 

survey of people with developmental disabilities to determine eligibility for community services. 

Unfortunately, this consisted only of asking state institutional residents and their guardians 

whether they would like to live in the community. Predictably, only 80 out of 1100 surveyed said 

yes, and, of these, only 60 are actually targeted for community placement. Placing the burden on 

institutional residents to state a preference affirmatively for community living is inconsistent 

with Olmstead’s requirement that the person not oppose community living. The Division also has 

a plan to identify persons with developmental disabilities who would like to move from nursing 

facilities. Owing to the present budget situation, however, this plan is unlikely to occur. 

The second cycle of Olmstead planning concluded in December 2002 with the publication of 

plans from each of the relevant state agencies. 

Because of the state’s budget deficit of about $1.5 billion, no substantial new funds for Olmstead 

implementation have been requested in the current planning cycle, and none are expected until 

2005. 

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The Aging and Adult Services Administration has been the most active in plan implementation. 

Among other initiatives, the agency awarded two contracts for a three-year pilot program to 

enhance availability and retention of personal assistance workers. 

The Division of Mental Health has been allocated almost $14 million to expand community 

services for people transitioning from state hospitals. Two staff members have been assigned to 

coordinate the transition process. 

A provision in the plan that the Division of Vocational Rehabilitation (DVR) would provide 

independent living services to 170 additional persons has not been implemented. Instead, DVR 

has focused on traditional VR services. 

Washington has a Nursing Facility Transition grant to support the transition of 300 persons 

younger than 65 from nursing facilities. The state recognizes that it will not be able to meet this 

goal because of the absence of support systems for people with complex needs, especially in rural 

areas, and the nervousness of housing providers, despite the availability of Access 2000 

vouchers. 

In West Virginia, Governor Underwood created an Olmstead Task Force by executive order and 

charged it with identifying all institutionalized persons with disabilities and those at risk of 

institutionalization, the services they need, and the cost of providing them. A representative of 

HUD served on the Task Force. The resulting plan submitted on December 17, 2001, is basically 

a plan to plan. It contains no numeric goals or targets for deinstitutionalization or the creation of 

community services. As a general outcome, the document proposes that “people who choose to 

transition” from congregate settings may do so, rather than those who are unnecessarily 

institutionalized. The other general outcomes proposed for the plan focus on the changes in state 

law, policy, licensing, and certification changes that will be necessary to overcome the remaining 

institutional bias in the service system. Specific policy changes envisioned by the planners 

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include consumer control of personal assistance; elimination of the “home-bound” requirement; 

24-hour, seven-day backup support; changes in Certificate of Need requirements; and opening 

the system to more providers. The West Virginia plan provides and budgets for a strong 

infrastructure for Olmstead implementation and oversight, including an executive staff member 

on loan to serve as Olmstead director; an administrative assistant; office support; release time for 

agency and provider staff to serve on the Olmstead task force; travel and other compensation for 

consumers to serve on the Task Force; and a toll-free line answered by the Olmstead director and 

assistant as the “one-stop” point for all Olmstead-related information, including community 

service referrals, Olmstead complaints, mediation, and grievance procedures. One of the 

director’s roles is that of “assisting State agencies to ensure that their budget requests include 

sufficient funding to allow the State to meet its ADA obligations under the Olmstead decision.” 

The state plans to hire four regional Olmstead specialists to respond to local inquiries, conduct 

training, maintain regional resource databases, and assist in transition and diversion activities and 

grievance procedure, that is, “any potential service gap that could result in the consumer being 

returned to or potentially entering a more restrictive placement than that which he/she currently 

inhabits,” including a service gap that “prevents an individual from moving from an institutional 

or segregated setting to a community-based setting of his/her choice.” The Olmstead Director 

will receive complaints, acknowledge them within 24 hours, direct them to the appropriate 

agency, and ensure that they are resolved within 90 days of receipt. The complaint resolution 

process included provision for appeal and fair hearing. 

Wisconsin’s Olmstead planning had its origin in systemwide complaints filed with the OCR. In 

September 2000, after discussions with OCR, the Wisconsin Department of Health and Family 

Services (DHFS) designated the Wisconsin Council on Long Term Care as the state’s Olmstead 

planning body. Barriers to Olmstead planning soon surfaced in the workgroup discussions. 

Existing assessment tools proved inadequate to identify persons who could handle and benefit 

from community living, but rather focused on the availability of community support. Existing 

data were inadequate to estimate the number of people in nursing homes who wanted to move to 

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the community or were appropriate for community living. The Consumer Task Force found it 

difficult to get adequate representation of consumers. Despite these barriers, the plan for Phase I 

of the state’s Olmstead planning efforts was released in January 2002. Although initial plan 

activities focus on offering institutionalized persons a choice of where to live, the plan’s funding 

goal projects that by July 1, 2007, all persons “who have not made an informed choice to stay in 

the institution” (emphasis added) and who “could be served appropriately and cost effectively in 

the community” will be relocated from institutions. Given the size of Wisconsin’s institutional 

populations, this is perhaps the most ambitious goal set forth in any state Olmstead plan to date; 

significantly, the goal is stated in appropriate Olmstead language. However, this goal is not 

developed in the body of the plan, and the proposed DHFS budget for 2003–2005 does not 

acknowledge it or reflect even a token effort to implement the goal. The plan’s capacity-building 

strategies are extremely general (e.g., coordination with state housing, transportation, workforce, 

public instruction, and VR agencies, as well as with agencies that were not at the table during the 

planning process) and constitute little more than a plan to plan. 

Wyoming used the NAPAS template as an outline for its plan; however, the plan is a bare draft 

that contains neither timelines nor target dates. It does not identify how many persons are on 

waiting lists for community services; does not examine the adequacy of the state’s current 

assessment process; and does not ensure that all institutional residents will be assessed to 

determine whether they can handle and benefit from community living. Unique among state 

Olmstead plans, Wyoming’s plan contains a relatively thorough section on Acquired Brain 

Injury. Almost simultaneously with the development of the draft Olmstead plan, Wyoming 

developed a plan for its mental health system that contains much more specific action steps. 

Unaccountably, there is little integration between the two plans. 

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V. 

Lessons Learned: Good Practice in 

Community Services and What Works 

The states’ Olmstead planning efforts include many examples of promising practices in the 

design, delivery, and financing of community services. We hope that policymakers, program 

administrators, and advocates can make use of these examples in their efforts to make real the 

right of people with disabilities to live in the most integrated setting. First, we shall single out 

some examples from the states of exemplary Olmstead planning. Next, we shall identify 

examples of promising practices and strategies for facilitating effective Olmstead 

implementation. 

1. Good Practice in Olmstead Planning 

One of the most effective approaches to Olmstead planning we have seen to date is the report of 

the Governor’s Commission on Home and Community-Based Care in Indiana. In this report, the 

planning group assigned each of its recommendations to one of three categories: (1) those that 

should be implemented quickly and with little or no fiscal impact or regulatory requirements; 

(2) those that should be implemented quickly but have a fiscal impact or require regulatory 

changes; and (3) those that are more complex, costly, or difficult and will require more time to 

develop and implement. The Commission developed 16 recommendations that are directly 

responsive to systemic barriers, can be implemented simply and at little or no additional cost, and 

are judged critical to developing the longer-term recommendations of the planning group. 

We agree with the advocates in Maine who urged that planners should focus on the “meat and 

potatoes” of getting people out of segregated settings and not merely the “dessert and 

champagne” of improving the existing community system. The Texas Olmstead planning process 

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does an admirable job of focusing on this goal, and Georgia’s plan also is focused appropriately 

on the “meat and potatoes.” Texas’ tracking of the persons who have moved from nursing 

facilities to the community under Rider 37 also is commendable. 

Nevada’s Olmstead plan is commendable for its candid analysis of the state’s compliance with 

Olmstead and for stating at least some of the goals in the plan with sufficient specificity to enable 

the planning group to evaluate objectively whether the state has followed its recommendations. 

Oregon’s plan, The Olmstead Decision and Adults in Oregon’s State Hospitals, is a model 

Olmstead plan in many significant respects. It identifies with specificity the people recommended 

for community placement and the services they will need in the community, considers the 

adequacy of existing services and the changes needed to make those services responsive to the 

needs of consumers, and projects the costs that will be associated with transition. 

Maine’s Olmstead planning process has been unusually broad, inclusive, and well resourced. A 

wide range of disability groups, program administrators, and services providers has participated 

in the process, and the state provided funds for staff support from the University of Southern 

Maine and for workgroup members’ travel expenses to the meetings. 

A component of the West Virginia plan that deserves to be replicated by other states is the 

infrastructure for Olmstead implementation and oversight for which it provides and budgets. 

That infrastructure includes an executive staff member on loan to serve as Olmstead director; an 

administrative assistant; office support; release time for agency and provider staff to serve on the 

Olmstead task force; travel and other compensation for consumers to serve on the Task Force; 

and a toll-free line answered by the Olmstead director and assistant as the “one-stop” point for all 

Olmstead-related information, including community service referrals, Olmstead complaints, 

mediation, and grievance procedures. Among the ambitious roles for the director is that of 

“assisting State agencies to ensure that their budget requests include sufficient funding to allow 

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the State to meet its ADA obligations under the Olmstead decision.” Equally promising are the 

state’s plans to hire four regional Olmstead specialists to respond to local inquiries, conduct 

training, maintain regional resource databases, and assist in transition and diversion activities and 

grievance procedures. 

Another promising component of the West Virginia plan is its proposed procedure for resolving 

Olmstead-related complaints. An Olmstead complaint is “any potential service gap that could 

result in the consumer being returned to or potentially entering a more restrictive placement than 

that which he/she currently inhabits,” including a service gap that “prevents an individual from 

moving from an institutional or segregated setting to a community-based setting of his/her 

choice.” The Olmstead director will receive complaints, acknowledge them within 24 hours, 

direct them to the appropriate agency, and ensure that they are resolved within 90 days of receipt. 

The complaint resolution process included provision for appeal and fair hearing. 

The Olmstead planning group in Arkansas has made a concerted effort to inform Arkansas of 

Olmstead issues and the planning process, through regional “revival” meetings, newsletters, and 

Web sites. Advocates in many states have engaged in effective cross-disability coalition building; 

for example, the Coalition of Californians for Olmstead (COCO) has brought together an 

exceptionally broad cross-disability coalition of consumers and advocates for successful 

legislative advocacy. The Connecticut Olmstead coalition has also brought together different 

disability constituencies. 

Wisconsin’s Olmstead plan contains a funding goal of transitioning to the community all 

institutionalized persons “who have not made an informed choice to stay in the institution” and 

could be served appropriately in community settings. Although the state’s current budget does 

not reflect this goal, the goal is stated in language that is consistent with Olmstead and is an 

example of an appropriate Olmstead planning goal. 

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2. Overcoming Incentives to Unnecessary Institutionalization 

Several states have demonstrated methods of overcoming incentives to unnecessary 

institutionalization. Maine’s use of pre-admission screening prior to nursing facility placement, 

in which a single independent agency performs the assessments, has helped reduce nursing home 

utilization. 

Minnesota has encouraged the nursing facility industry to reduce the number of nursing facility 

beds with legislation (enacted in 2000) that allows nursing facility operators to place beds in 

“layaway” for up to five years, that is, to take them temporarily out of service and have them be 

treated as though they were unlicensed during that interval. In the first 18 months of the 

“layaway” program, nursing facility operators took 2,350 nursing facility beds out of service. 

Legislation enacted in 2001 goes further and established the goal of closing or partially closing 

up to 5,140 beds during FY 2002 and 2003. This approach has made Minnesota one of the 

leading states in the nation in the reduction of nursing home beds, with a 9.5 percent reduction 

from 1996 to 2001. 

The state of Washington has reduced its nursing facility population with several strategies. Each 

of the state’s six regions had an annual reduction target for nursing facility caseloads, and the 

state tracked these targets monthly. Case managers are assigned to specific nursing facilities, and 

their responsibilities are limited to assessing and working with clients to be relocated. Within 

seven days of entering a nursing facility, a resident receives a comprehensive functional 

assessment using an instrument developed by the state to determine eligibility for all residential 

settings. The case manager then determines whether the resident should be classified as an 

“active relocation client.” If so, discussions with the resident about community-based options and 

preferences begin within two weeks, a timeframe that ensures that the community placement 

process will begin before the person begins to deteriorate functionally and emotionally. 

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Ensuring that “the money follows the person” requires a particular set of methods for overcoming 

institutional bias. Because of fixed costs in many institutional settings and the specific 

configuration of most federally financed disability services, this is difficult to accomplish for 

people already living in institutions, but less difficult for people who are not yet institutionalized. 

Florida is conducting a long-term managed care demonstration project whose goal is to divert 

elders and people with significant disabilities from nursing facility placement by eliminating 

financial disincentives to nursing facility use. In this project, the state pays participating HMOs a 

capitated rate for all Medicaid services, including home- and community-based services and 

nursing facility services. The HMO is responsible for unlimited nursing facility payments for 

Medicaid beneficiaries enrolled in the program for as long as the person remains enrolled. As a 

result, the HMO has a strong incentive to reduce costs by reducing nursing facility usage. The 

HMOs employ case managers to coordinate acute and long-term care services and offer certain 

benefits, including partial room and board payments in assisted living facilities, in addition to the 

services by Medicaid and the state’s home- and community-based waivers. The program appears 

to have had success in diverting a significantly impaired population from nursing facilities. 

Similarly, New Mexico is developing a “global funding” Section 1115 waiver request to CMS, 

under which Medicaid reimbursement no longer will be tied to nursing facility beds or waiver 

slots but will be attached to the consumer. Consumers of long-term care services will be able to 

move from one setting to another without having to go on a waiting list. The waiver will enable 

the state to finance long-term care services using funds currently identified for Medicaid nursing 

facilities and home-based care services. The waiver will enable long-term care consumers to 

receive more cost-effective services because the state spends $39,000 annually for nursing 

facility services compared with $17,000 for home- and community-based services. 

Texas’s Rider 37, a modification to the state’s system of funding nursing facilities is probably the 

most well-known example of “the money follows the person.” The rider allows “the general 

revenue used to purchase [nursing facility] services to follow the individual into the community 

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and purchase community services.” Similarly, Missouri’s H.B. 1111 requires that persons 

eligible for or receiving nursing home services must be given the opportunity to have Medicaid 

dollars follow them to the community and choose the personal care option in the community that 

best meets the person’s needs. It states that “individuals eligible for the Medicaid Personal Care 

Option must be allowed to choose, from among all the options, that option which best meets their 

need; and also be allowed to have their Medicaid funds follow them to whichever option they 

choose.” 

Even before Olmstead, South Carolina used a formula for transferring funds from the institutions 

to the community. State Appropriations Acts gave the Department of Disabilities and Special 

Needs the authority to retarget resources, realign the workforce, and shift funding from state 

institutions to local communities. As institutional residents moved to the community, the state 

negotiated voluntary separation agreements with institutional employees, and those FTEs were 

then deleted from the institutional budget line and the funds transferred to local disability boards. 

In Kentucky, the Olmstead planning committee has recommended that all persons who currently 

live in personal care homes will be transitioned to their own homes, a family care home, or a 

group home, and that the funds currently used to support them in personal care homes will be 

reallocated to support people in more community-integrated settings. 

3. Identification and Transition of People with Disabilities from Institutions 

In Colorado, Atlantis/ADAPT is a subcontractor for Colorado’s Nursing Facility Transition grant 

implementing a project to establish support networks based in Independent Living Centers, 

inform 1,200 nursing facility residents of their right to receive services in the community, 

identify barriers to transition, and establish a model transition planning process. 

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“Operation Escape” is a program developed by ADAPT of Kansas to identify people in nursing 

facilities who wish to move to the community. ADAPT secured the cooperation of the Kansas 

Departments of Aging and Social and Rehabilitation Services with this approach, in which 

members of ADAPT go into facilities to provide information about services, assistance with 

moving out, advocacy, and follow-up. 

4.	 Use of Trusts and Fine Funds to Finance Transition Costs and Start-Up of 

Community Services 

A creative and underappreciated set of strategies for financing transition costs, providing “bridge 

funding,” and funding new community services involves the creation of trusts and fine funds 

dedicated to the needs of people with disabilities. The North Carolina Division of Mental Health, 

Developmental Disabilities and Substance Abuse Services (MH/DD/SAS) provides “bridge 

financing” for people leaving the institution for the community through two mechanisms: a 

MH/DD/SAS Trust Fund and Realignment/Community Capacity Reinvestment. The Trust Fund 

is a fund designated by the legislature for start-up and short-term operational costs of developing 

community services, housing, rental deposits, equipment purchases, and other resources for 

people leaving institutions in the interim before savings are realized through realignment of 

institutional resources. In the Realignment/Community Capacity Reinvestment strategy, as 

individuals leave state institutions, the financing of their community services will come directly 

from the planned redirection of the resources that become available as a result of closing 

institutional beds. In 2002, the Senate set aside $50 million for the Trust Fund. A budget 

amendment provided that all proceeds from the sale of the Central North Carolina School for the 

Deaf would be deposited in the Trust Fund. 

Ohio has an administrative rule providing that one-third of the proceeds from the collection of 

franchise permit fees and penalties paid by nursing facilities and hospitals are to be deposited in a 

“home and community-based services for the aged fund” and used to fund programs for 

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Medicaid beneficiaries, including the PASSPORT waiver for persons older than 60 who are at 

risk of nursing facility placement. 

In Oregon, the proceeds from the sale of a state psychiatric facility, Dammasch State Hospital, 

were placed in a housing trust fund. The Mental Health Alignment Work Group, a planning body 

formed to redesign Oregon’s mental health service system, recommended that these funds be 

transferred to the Oregon Housing and Community Services Department for leveraging and 

growth. Similarly, the Delaware Commission on Community-Based Alternatives for Persons 

with Disabilities has recommended to the Delaware state legislature that the state sell off the land 

and facilities at Stockley that are not needed and dedicate the proceeds to the improvement and 

expansion of community-based services. 

Case managers in Washington have a flexible pot of money available to facilitate nursing home 

transition from an unusual source—fine monies levied against nursing facilities for violations of 

licensing standards. Fine monies are placed in a Civil Penalty Fund and can be used to fund 

security deposits, utilities, furniture, home modifications, and other housing costs. Case 

managers have significant flexibility in the use of these funds. 

5. Housing Strategies 

Housing has been an especially problematic area for Olmstead implementation. Commendably, 

and in large part because of the influence of the technical assistance provided by HHS’ OCR, the 

more recently developed plans tend to reflect the input of housing agencies. The 

recommendations of Massachusetts’ Olmstead planning group in the area of housing are 

thoughtful, concrete, and a good example of the results that can occur when state housing 

agencies are at the table. Those recommendations include requiring universal design in new units 

that state housing agencies fund or finance; developing new housing to the greatest degree 

possible in areas serviced by accessible public transportation or in areas where fundamental 

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amenities are in walking distance; ensuring that all existing publicly financed housing has 

completed Section 504/ADA self-evaluations; expanding the agency’s definition of “homeless” 

to include persons living in rest homes, rehabilitation facilities, and group homes; conducting 

utilization reviews to ensure that targeted Section 8 programs are fully used; and researching 

whether underused housing developments for elders and persons with disabilities can be 

reconfigured to provide more usable and desirable housing 

The strategies for addressing housing needs in Mississippi’s Olmstead plan are also promising. 

They include training case managers in housing facilitation; expanding the menu of services 

under home- and community-based waivers to include home modifications and home repair; 

expanding home modification and accessibility services under the independent living program; 

encouraging the Mississippi Development Authority to allocate 5 to 10 percent of all state 

housing funds granted to cities and counties to be used for people with disabilities; bringing 

housing agencies (including Rural Development and Regional Housing Authorities) together to 

educate them on the funding needs of people with disabilities; earmarking 10 percent of Section 

8 vouchers for people with disabilities; and increasing funding to cover down payments and 

closing costs from the Mississippi Development Authority. 

New Hampshire has amended its state Section 8 plan to create an immediate highest priority for 

people coming out of institutions. 

6. Single Point-of-Entry Systems 

Many states are designing single point-of-entry systems to overcome the barriers to service 

delivery that are created by fragmented, categorical service systems. At least theoretically, single 

point-of-entry structures have the potential to reduce unnecessary institutionalization by 

providing easier access to a wider array of community services. Single point-of-entry systems 

that separate assessment and service brokerage from service provision are also responsive to 

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CMS’ findings in a number of states that Medicaid beneficiaries’ right to choose among qualified 

providers was violated. 

The long-term plan of the North Carolina Department of Health and Human Services, called 

Blueprint for Change, calls for reorganizing the Department from its present divisional model of 

“essentially freestanding, single-disability silos” that operate independently of one another to a 

cross-disability framework that is intended to foster the development of common approaches to 

similar issues. The area agencies that currently provide services will be reorganized into Local 

Management Entities that will develop local business plans for development of services and 

manage a network of providers. To receive public funds, the provider must be a member of the 

network. Access to the reformed system at the local level will be through a “uniform portal.” 

New Jersey’s Easy Access, Single Entry uses a toll-free caller system that can identify the county 

from which the call is made and automatically transfer the caller to the single entry office for that 

county. Callers can obtain information, receive counseling about available public benefits, 

schedule comprehensive assessments, and arrange for services to be provided. 

7. Beyond Institutional Closure: Increasing Community Integration 

State service delivery systems vary tremendously around the country, from systems in which 

institutions provide the only real choice for people with high support needs to systems in which 

institutions were eliminated more than a decade ago. Developmental disabilities services in 

Vermont and New Hampshire show that “the most integrated setting” is more than placement in 

a residence outside an institution but a continuous process of increasing community inclusion. 

Since the closure of its state developmental disabilities institution, Vermont has continued to 

pursue the goal of increasing community integration by reducing the size of community 

residential settings, expanding supported employment, and phasing out group homes in favor of 

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more normal settings, such as supervised apartments, companion homes, and adult foster homes. 

From 1993 to 1999, the number of persons in supervised apartments increased by 30 percent and 

the number of persons in developmental homes increased by more than 80 percent, with 

corresponding decreases in the number of persons living in staffed group homes and small 

ICFs/MR. The average size of a community residence is 1.2 persons. Vermont’s community 

service system is unusual in that the “developmental home,” which may be either a home in 

which a person with disabilities lives with a companion or an adult foster home in which the 

person lives in a pre-existing household, is its primary service model. Benefits of that model 

include tax-free payments to foster families, which increase substantially the value of the income 

to host families and the benefit to persons with disabilities of the social networks of the host 

family. 

Vermont uses its home- and community-based waiver to provide services called “flexible 

supports,” a service category approved by CMS in 1998, which include personal support in the 

home and community, transportation, therapies, crisis services, environmental modifications and 

equipment, and any other support other than service coordination and supported employment 

included in the person’s plan of care. The state also has a system of cash payments to families. 

Vermont’s use of flexible, individualized services in normal settings is highly cost-effective, and 

the state does not have lengthy waiting lists. 

Similarly, New Hampshire’s developmental disabilities service system has progressed far beyond 

the closure of its state developmental disabilities institution in 1991. The self-determination 

model pioneered by Monadnock Developmental Services has been adopted statewide. From large 

group homes and sheltered workshops, consumers have moved to homes of their own, 

companion homes, and supported employment. 

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8. Self-Determination 

All over the nation, states are adopting the principles of self-determination and consumerdirected services in pilot and demonstration projects, as a service option, or even as a statewide 

service delivery system. Programs like California’s program of In-Home Support Services and 

Arkansas’ Cash and Counseling Demonstration show that people whose disabilities are at least as 

significant as those of nursing facility residents can live in their own homes, direct their own 

services, and avoid institutional placement. Iowa’s experience shows that consumer-directed 

personal assistance services can be provided as a state plan service under the personal care 

option. 

We thus conclude this report as it began, with an affirmation of self-determination as an 

exemplar of the “most integrated setting.” The 50 states and the District of Columbia are in 

vastly different stages of progress toward the most integrated setting, but by 2003, selfdetermination and consumer-directed services plainly have emerged as the guiding principles for 

supporting people with disabilities in inclusive communities. 

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VI. 

Conclusions and Recommendations 

Conclusions 

1.	 Plans do not consistently provide for opportunities to live in the most integrated 

setting as people with disabilities define “the most integrated setting.” 

On the one hand, many state Olmstead plans invoke as guiding principles services that were most 

often cited by people with disabilities as fostering true community integration: highly 

individualized support that depends on the person, is defined by and tailored to the individual, 

and may change over time. Many plans call for the development of service models, such as selfdetermination and consumer-directed services, that correspond to the stated preferences of people 

with disabilities, especially physical disabilities and developmental disabilities. 

However, few Olmstead plans explicitly address the creation of opportunities to live in the 

most integrated setting as the persons with disabilities we interviewed were most likely to 

define “the most integrated setting,” that is, as “a place where the person exercises choice and 

control.” In particular, very few plans call for the development or expansion of the models of 

consumer-operated services preferred by people with mental illness, such as peer counseling 

and drop in centers. 

2.	 Few Olmstead plans consider institutional populations other than people in nursing 

facilities, developmental disabilities institutions, and psychiatric institutions. 

The needs of people who live in institutions other than nursing facilities, developmental disabilities 

institutions, and psychiatric institutions, such as board and care facilities, juvenile facilities, 

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residential treatment facilities, shelters, corrections facilities, and large group homes, are not 

addressed in most states’ Olmstead plans. This is all the more remarkable considering that more 

than 800,000 people with disabilities live in board and care facilities across the United States. 

There are exceptions, such as Maine’s effort to identify people who are unnecessarily 

institutionalized in board and care facilities and Iowa’s plan to compile a comprehensive list of 

the Iowans living in residential settings, including residential treatment facilities, corrections 

facilities, and any other congregate facilities that may be identified. Planning groups in which 

consumers and advocates were well-represented on the planning committees and that played a 

leading role in developing the plan were more likely to take a broad look at institutional 

populations. 

3.	 The needs of people with psychiatric disabilities have not received a fair share of 

attention in the plans. 

The absence of community services clearly has kept thousands of persons with mental illness 

institutionalized in state psychiatric hospitals, many thousands more live in nursing homes, and 

others are inappropriately institutionalized in jails. However, people with mental illness have not 

received their fair share of attention in most states’ Olmstead plans. Surprisingly, few state plans 

had made provision for identifying persons with mental illness living in nursing facilities and 

other institutional settings, where it is unlikely they will receive treatment. 

4.	 People with developmental disabilities have been relatively disadvantaged in the 

setting of goals for community placement. 

This is a surprising conclusion given the relative success that people with developmental 

disabilities have enjoyed in the past two decades in obtaining well-resourced community services 

and the fact that the lion’s share of state spending on home- and community-based waiver 

services still is targeted to people with developmental disabilities. Yet in those state Olmstead 

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plans where targets exist for people with developmental disabilities to move from institutions to 

the community, those targets are extremely modest. For example, the Olmstead plans of 

Washington and Texas call for placement of less than 10 percent of the residents of state 

developmental disabilities institutions. This is ironic indeed, considering that the movement for 

community integration of people with developmental disabilities is justly considered a success 

story and studies of the closure of entire institutions documented that virtually everyone with 

developmental disabilities can live in the community. 

In part, the limited numbers of people with developmental disabilities slated to move arises from 

the states’ misinterpretation of the Olmstead standard as requiring people with disabilities to 

express a desire affirmatively to move before they can be considered for community placement. 

Another cause is the “stakeholder” composition of Olmstead planning groups and advisory 

committees, in which parents, including parents of institutionalized persons with developmental 

disabilities who oppose community placement, play a significant role. 

A related phenomenon is that opposition to deinstitutionalization from parents and guardians has 

received relatively little attention in Olmstead plans, although people with disabilities, especially 

people with developmental disabilities, regard such opposition as a significant barrier to 

community integration. 

5.	 The majority of states have not planned to identify or provide community placement 

to all institutionalized persons who do not oppose community placement. 

In Olmstead v. L.C., the Supreme Court held that all people who can handle and benefit from 

community placement have a right to live in the community, subject only to the states’ 

“fundamental alteration” defense. The Court added that the state had no duty to offer community 

placement to persons who oppose leaving the institution and may continue to provide them with 

services in the institution if it chooses to do so. A state may also, consistent with Olmstead, 

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decide to close all its institutions and offer services only in the community. However, the Court 

certainly did not condition the right to live in the most integrated setting on the person’s 

affirmative expression of a desire to move. 

Many state Olmstead plans provide that the state will identify and support in the community only 

those institutionalized persons who choose to live elsewhere. For example, the plan produced by 

the Delaware Department of Health and Social Services envisions community placement of only 

24 residents of its state developmental disabilities institutions, about 12 percent of the 

population, who “want” to move. Arkansas’ plan proposes to consider for community placement 

only those persons who “choose to live elsewhere.” Even Texas’ plan, which is justly considered 

a model in other respects, envisions community placement only for those who would like to 

move. Exceptions exist, of course. Georgia’s plan is a shining example of a plan that does 

properly apply the Olmstead standard. 

To some extent the emphasis in the plans on people who express an affirmative desire to move to 

the community may reflect the different perspectives of people with physical disabilities and 

people with developmental disabilities. In the physical disability movement, choice has been 

used as a sword to free people from institutions. In the movement of people with developmental 

disabilities, “choice” (usually, the choice of the person’s parent or guardian) has been used more 

often to keep people in institutions rather than to free them. 

6.	 Provisions in state Olmstead plans for assessing people with disabilities in 

institutions to determine if they can handle and benefit from community living are 

surprisingly limited. 

Without the assumption that all or nearly all institutionalized persons with disabilities can handle 

and benefit from community living, which most state planning groups have not embraced 

explicitly, identification of institutional residents who can handle and benefit from community 

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living is a vital first step in eliminating unnecessary institutionalization. Even if it is assumed that 

everyone can live in the community, effective planning requires identification of the support and 

services people will need in the community so that those services will be ready when the person 

moves. Thus, an objective assessment process is a critical component of the process of planning 

for community transition. Most states began the Olmstead planning process with little or no data 

on persons who may meet the conditions for community services described in the Olmstead 

decision. Typically, certain data do exist on the needs of Medicaid-supported applicants for 

nursing facilities, which are assessed to determine whether they meet the medical criteria for 

nursing facility placement; however, such assessments do not address whether the person could 

live in the community. In some state plans, collection of this data is proposed as an 

implementation activity, for example, development of data systems that can identify and track 

persons who are affected by the Olmstead decision as well as those at risk of unnecessary 

institutionalization. 

Few plans examine the adequacy of existing assessment procedures. In part, this is because few 

such procedures exist. 

7. Few plans contain timelines and targets for community placement. 

Setting clear targets for community placement is an essential component of an effective plan. 

Without knowing what persons will move and what needs they have, developing the community 

support and services those persons will need in a planned manner or developing budget proposals 

that reflect the needed funding or transfer of funds to the community is impossible. Yet, few state 

plans contain numerical community placement goals and timelines. 

In some cases, state officials on the planning groups have actively resisted setting numerical 

targets. For example, in Connecticut, the numerical targets suggested by members of the 

Community Options Task Force are not reflected in the plan because the Long Term Care 

Planning Committee refused to set measurable goals for community integration. In Delaware, the 

Olmstead plan developed by the Department of Health and Social Services contains no goals for 

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enabling residents of psychiatric institutions to move to the community. Rather, it simply states 

that its current process for evaluating people after they are admitted to a psychiatric institution 

complies with Olmstead. 

Targets that do exist are typically very modest. For example, Indiana’s plan calls for reducing the 

population of the state psychiatric hospital by 100 and developing community services for 350 

institutionalized persons with developmental disabilities (out of a total of nearly 3,500) who have 

been “targeted for placement” by 2003. The plan does not include the number of persons in need 

of service, the projected number of individuals to be served, or the funding needed for such 

services. Timelines are short-term, with most being within the next two years, and most action 

steps were already in progress before the document was written. The document appears to be 

more of a status report than a comprehensive plan. Where more substantial targets for developing 

community services have been set, as in Massachusetts, those targets are commonly required by 

court orders or consent decrees. 

8. 	 Few plans identify systemic barriers to community placement or state action steps to 

remove them. 

Most states have failed to examine barriers to community integration that could be removed quite 

cost-effectively, for example, differences in coverage of health-related services under state homeand community-based waivers and nursing facilities, which have the effect of driving people into 

more costly institutional settings as the only way to obtain health services even though they could 

be provided more cost-effectively in the community. Other examples of barriers to community 

integration that could be removed cost-effectively are the failure to take advantage of CMS rules 

that allow coverage of community transition costs under a home- and community-based waiver 

for months before the actual move or different asset and income rules for Medicaid eligibility in 

the community and in nursing facilities, respectively, that can lead to loss of Medicaid eligibility 

for people who move back to the community. Often, barriers that have been identified in the 

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reports of consultants to state agencies or by state agencies themselves are simply not addressed 

or even acknowledged in the state’s Olmstead plan. 

An exception is the widespread recognition that state Nurse Practice Acts may need to change to 

allow personal assistants to administer certain medical procedures. This recognition is 

undoubtedly due to the efforts of the physical disability movement, which successfully has 

highlighted this issue. However, states need to look much more closely at the configuration of 

their service delivery systems, their use of available federal financial assistance, and the 

opportunities available to transfer funding to the community. 

If some of the earlier Olmstead plans, written before the current state-funding crisis developed, 

read like a “wish list,” some of the later plans read like lists of specific projects rather than a 

blueprint for systems change. This evolution can be seen in the shift in Arkansas’ planning 

process from the list of 115 recommendations developed in summer 2002 to the relatively limited 

number of projects set forth in the draft plan produced in fall 2002 and still not connected in any 

cohesive fashion. 

9.	 In many states, initiatives other than Olmstead have been a more significant driving 

force for system change than the Olmstead planning process. 

In many states, state and federal initiatives other than Olmstead have been a driving force for 

system change. For example, a number of states have been encouraged by the opportunities 

presented by Section 1115 demonstration waivers and combined Section 1915(b) and (c) waivers 

to redesign long-term care programs and develop unified funding streams combining state, 

federal, and local funding for community and institutional long-term care into a single capitated 

benefit. This allows states to streamline fragmented and overlapping funding streams and can 

effectively eliminate institutional bias. A single point of entry for information, pre-admission 

counseling, and intake is frequently a part of these system redesign efforts. 

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CMS audits and reviews of state home- and community-based waiver programs that have found 

noncompliance with Medicaid choice of provider requirements or conflict of interest when a state 

or local government agency fails to separate assessment from service delivery have provided a 

significant impetus for change, such as in Pennsylvania. Although such system redesign efforts 

have the potential to prevent unnecessary institutionalization, advocates have found that they 

must be especially vigilant to ensure that the needs of people with disabilities are met in the 

process and that the result is not simply to save money for the state. 

In the past two decades, litigation has probably been the most significant force driving states to 

reconfigure their service delivery systems. In state after state, we found that court orders and 

consent decrees are a more powerful force driving community placement than the Olmstead 

planning process. 

10.	 State Olmstead plans often are not well integrated with the states’ other long-term 

care plans. 

In many states, we found a fascinating contrast between the Olmstead planning process, in which 

consumers and advocates tend to be well-represented if not leading members, and concurrent or 

pre-existing long-term care planning processes in which stakeholders also were represented but 

that plainly were internal activities of the state agency. 

Some states, such as Ohio, used previous long-term care planning as the basis for a later 

Olmstead plan. The problem is that sometimes the earlier plan was not developed to conform to 

Olmstead requirements, leading to a somewhat uneasy mix. In other states, the effect of 

concurrent but separate planning processes is that the Olmstead planning process appears as the 

public face of the state agency, whereas the internal process is where the “real” decisions and 

actions take place. 

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11. Federal initiatives have had a positive impact on the Olmstead planning process. 

In addition to the HHS letter of January 14, 2000, to state Medicaid directors outlining the 

criteria for an Olmstead plan, the federal initiatives that have had the greatest positive impact on 

the planning process include the encouragement by the HHS OCR to submit Olmstead 

complaints to OCR and OCR’s response to these complaints—advocacy that the states engage in 

Olmstead planning as an alternative to undergoing extensive complaint investigation—and the 

provision of technical assistance to the states in Olmstead planning. In many of the states, the 

development of an Olmstead plan was a direct response to an OCR investigation. 

The training program funded by CMS and ED and delivered by the Independent Living Research 

Utilization (ILRU) and the Brain Injury Association (BIA), Inc., “Disability Advocacy in a postOlmstead Environment,” was quite influential in helping form state-level cross-disability 

Olmstead coalitions and arming them with knowledge of how to advocate for an effective 

Olmstead plan. In states as diverse as California and Louisiana, the Olmstead coalitions trained 

by ILRU and BIA have probably been the single most powerful driving force behind the 

Olmstead planning process. 

The availability of Real Choice Systems Change grants also has facilitated Olmstead planning; 

more specifically, these grants have encouraged the states to work directly with the disability 

community. The option of receiving federal funds dedicated to nursing facility transition and 

other Olmstead-related activities has encouraged states to include these activities in their 

Olmstead planning efforts. However, it has proven more difficult to integrate the activities 

supported by the Real Choice Systems Change grants into states’ overall service delivery 

systems. 

In contrast, federal initiatives in the area of housing unfortunately have had little impact on state 

Olmstead plans and it cannot be said that these initiatives have facilitated deinstitutionalization. 

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12.	 Advocates have successfully used state legislatures to jump-start the planning 

process. 

Many state Olmstead plans have been or are being developed in response to a mandate from the 

legislature. In a number of states, including California, Delaware, and Oklahoma, advocates have 

succeeded in persuading the state legislature to start or restart the planning process when the 

executive branch was unwilling to begin a planning process or take it seriously. 

13.	 Housing, transportation, and educational agencies are seldom meaningful 

collaborators in the planning process. 

Although lack of available, affordable, and accessible housing is almost certainly the most 

significant barrier to community placement experienced by institutionalized persons with 

disabilities, relatively few planning groups include representatives of state housing, 

transportation, and education agencies. The tendency to locate the Olmstead planning process in 

state human service agencies has created a barrier to inclusion of other important agencies. 

Further, few plans include data on waiting lists for available housing or strategies for overcoming 

housing shortages. 

14. State budgets often do not reflect Olmstead planning goals. 

In addition to developing an effective Olmstead plan, a further challenge to state officials is to 

ensure that the goals in the plan are reflected in the state budget. Some state planners have 

avoided this problem by obtaining explicit commitments to link the budget process and the 

Olmstead planning process. For example, Washington’s Olmstead plan was developed explicitly 

to serve as the basis for program revision requests in the state budget. A tension may arise 

between the short-term focus of state budgets and the longer-term focus needed for an effective 

Olmstead plan; however, this tension does not necessarily have to exist, as can be seen by the 

example of Mississippi’s long-term plan that was intended to serve as a guide to budget 

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development as well as service system change. (That plan has run aground because of state 

budget shortfalls that have eliminated most of the funding for the plan.) 

15.	 In most states, elders and their organizations have not been true collaborators in the 

planning process. 

In most states, the Olmstead planning process has been driven by disability organizations. With 

some significant exceptions, organizations of elders have been relatively less involved. In part 

this may be traced to the different perspectives the two constituencies bring to the table, with the 

disability movement focused more on individual rights and freedom from institutional 

confinement, and elders focused more on long-term care reform. 

16.	 The pace of deinstitutionalization has slowed, not accelerated, since Olmstead was 

decided. 

In most states, the pace of deinstitutionalization has slowed since the 1990s. In a significant 

number of states, populations have remained relatively constant in the past few years, for 

example, Arkansas, California, Connecticut, and Delaware, where it has been estimated that only 

about half of one percent of Delaware’s institutional population moved to the community in 

2002. In some places (for example, Alaska, the District of Columbia, and Idaho), institutional 

populations actually have increased in the past few years. Medicaid expenditures on nursing 

facility services have increased significantly in most states from 1996 to 2001, and whereas some 

of this reflects inflation and the impact of an increasingly older U.S. population, much of the 

increase can be traced to an oversupply of nursing facility beds and the relative absence of 

community support and services for elders with significant disabilities. 

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Recommendations: How the Federal Government Can Facilitate Implementation of 

Olmstead v. L.C. 

Ultimately, only comprehensive amendments to Title XIX of the Social Security Act, similar to 

the amendments proposed in MiCASSA, will overcome the institutional bias within the 

Medicaid program. We urge the Administration to work collaboratively with the disability 

community and other stakeholders to craft such legislation. In the meantime, however, short of a 

thorough revision of Title XIX, federal agencies can and should undertake many measures. 

1. 	 NCD recommends that HHS and its CMS provide more explicit guidance on 

implementation of Olmstead v. L.C. 

Despite the detailed guidance in the original Olmstead letters to the states concerning Olmstead 

planning, the states’ implementation record shows that some of the most basic Olmstead 

principles must be reinforced. Few states have attempted to identify those residents of nursing 

facilities, psychiatric hospitals, or developmental disabilities institutions who could receive 

services in a community-integrated setting, let alone all persons who are unnecessarily 

institutionalized. Even fewer have developed, or plan to develop, waiting lists for community 

services that include people who are unnecessarily institutionalized. 

Many states have misinterpreted the Supreme Court’s directive on how persons who are qualified 

for community living may be identified. The Court did not place the burden on institutionalized 

persons with disabilities to request community placement affirmatively, and neither may the 

states. An active waiting list would include every institutionalized person who can handle and 

benefit from community placement and does not oppose community placement. 

Similarly, nothing in the Court’s opinion in Olmstead allows guardians or other surrogate 

decisionmakers to decide that an institutionalized person with disabilities is not qualified for 

community placement. The great weight of judicial opinion also makes clear that guardians 

cannot annul the basic right under the ADA to be free from discrimination. Similarly, the case 

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law makes clear that the right to receive services in the most integrated setting is not limited by a 

person’s competency status under state law. NCD believes that HHS and CMS need to provide 

guidance to states making clear that they cannot discharge their duties under the integration 

mandate of the ADA by offering community placement only to those institutional residents 

whose guardians have requested it or are considered legally competent to request community 

placement under state law. 

CMS has made clear to the states in its Olmstead letters that compliance with the requirements 

of Title XIX of the Social Security Act does not necessarily equal compliance with the ADA. 

CMS clarified in Olmstead Letter 4 that whereas Title XIX allows a state to set a limit on the 

number of persons who may receive services under a home- and community-based services 

waiver, such limits do not circumscribe the state’s obligation to serve people with disabilities in 

the most integrated setting nor provide a safe harbor from claims of discrimination. Similarly, 

CMS needs to make clear to the states in policy directives that a guardian’s choice for his or her 

ward of services available in a nursing facility or an ICF/MR rather than services available under 

a home- and community-based waiver does not waive the person’s rights under the ADA. 

Finally, CMS needs to make clear to the states that a comprehensive, effectively working plan 

must have numerical targets and timelines. Such goals are essential to any plan. Without numbers 

and timelines, it is impossible to judge whether a waiting list moves at a reasonable pace. 

2.	 NCD recommends that federal agencies complete the review of their own 

regulations that they began in response to Executive Order No. 13217 of June 18, 

2001, for consistency with the ADA. 

The Executive Order directed federal agencies to “evaluate the policies, programs, statutes and 

regulations of their respective agencies to determine whether any should be revised or modified 

to improve the availability of community-based services for qualified individuals with 

disabilities.” Although the agencies with important roles in Olmstead implementation, 

particularly HHS and HUD, did identify barriers to community integration within their own 

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regulations and policies and HHS, in particular, proposed regulatory changes to remove these 

barriers, the reports the agencies published in May 2002 were incomplete. 

3.	 NCD recommends that CMS review its regulations governing admission, discharge, 

and use control to determine their consistency with the ADA . To the extent CMS 

determines that those regulations are consistent with the Act, NCD recommends the 

agency enforce those regulations to assure that the states comply with the ADA in 

carrying out utilization review and professional review of the appropriateness and 

quality of care and services furnished to institutionalized recipients of medical 

assistance. To the extent CMS determines that the regulations are inconsistent, NCD 

recommends CMS use its rule-making authority to initiate amendments to the 

regulations. 

Title XIX requires state Medicaid agencies, health agencies, and other agencies with 

responsibility for services provided in Title XIX certified institutions to screen residents prior to 

admission and periodically to view the quality and appropriateness of services they receive in 

those facilities.271 As applied by the states, those regulations result in admission to nursing 

facilities and other institutions of many persons who could be supported in community-integrated 

settings. The regulations also permit the continued institutionalization of many persons who 

could handle and benefit from community living and do not oppose community placement. In 

that respect, the regulations permit practices that are inconsistent with Olmstead. 

CMS regulations require utilization control in Title XIX-certified facilities, in mental hospitals, 

and for inpatient psychiatric services to persons younger than 21.272 These regulations require 

periodic recertification by a health care professional of each resident’s continued need for 

271 42 U.S.C. §1396a(a)(33)(A). 

27242 C.F.R. §§ 456.201; 456.160; 456.360; 456.481. 

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intermediate care facility services or services in a mental hospital. In practice, these regulations 

are interpreted to permit continued institutionalization of any person who requires an 

intermediate care facility level of care or requires the services that an institution for mental 

diseases is intended to provide. In other words, the regulations have been interpreted to sanction 

long-term institutionalization of many persons who could receive appropriate community 

services under a home- and community-based waiver or other funding source of noninstitutional 

services. 

As applied by the states, the Title XIX regulations governing Preadmission Screening and 

Annual Review of Mentally Ill and Mentally Retarded Individuals who have been admitted to 

nursing facilities or whose admission is sought to nursing facilities (the PASARR regulations)273 

allow admission to nursing facilities and continued institutionalization of any person with mental 

illness or developmental disabilities who needs the “level of service” provided by a nursing 

facility, regardless of the person’s ability to handle and benefit from community living. The 

section governing admission of persons with mental illness or developmental disabilities states, 

“If the State mental health or mental retardation authority determines that a resident or applicant 

for admission to a NF [nursing facility] requires an NF level of services, the NF may admit or 

retain the individual.”274 Thus, the regulation sanctions the unnecessary institutionalization of 

many persons who could receive services in the community. Data from the states reveal large 

and, in many cases, growing populations of persons with developmental disabilities in nursing 

facilities in many states. Data on persons with mental illness are not as readily available, but 

anecdote suggests that unnecessary institutionalization of persons with mental illness in nursing 

facilities is also common. 

27342 C.F.R. §§ 483.112, 483.114, 483.126. 

27442 C.F.R. § 483.116(a). 

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In 1991 and 1992, CMS promulgated a regulation governing admission, transfer, and discharge 

rights in nursing facilities.275 Although the regulation is technically consistent with Olmstead, it 

should be clarified by interpretive guideline or additional explanatory language that the 

regulation does not forbid the transfer to appropriate community-based services of nursing 

facility residents who do not oppose community placement. 

The Title XIX regulation governing admissions, transfers, and discharges in ICFs/MR allows 

admission of persons who require an ICF/MR level of care but does not require facilities or state 

agencies to consider whether the person could be served in a community integrated setting, such 

as a home- and community-based waiver program.276 The regulation has been interpreted to allow 

admission to a large congregate ICF/MR of any person with developmental disabilities who 

needs active treatment, whether or not the person needs to be institutionalized to receive active 

treatment. CMS should clarify it or amend it. 

In its self-evaluations, HHS has approached the problems presented by the Title XIX facility 

admission regulations primarily as eligibility and coverage issues rather than as civil rights 

issues.277 In response to the Executive Order, HHS proposed a statutory change that would make 

it possible for the states to require higher levels of need for nursing facility admission without 

applying the same standards for home- and community-based waiver recipients. The change 

would allow states that have tightened or would tighten institutional eligibility for hospitals or 

Intermediate Care Facilities for the Mentally Retarded (ICFs-MR) to do so, without 

simultaneously narrowing HCBS [Home- and Community-based Services] waiver eligibility, by 

27542 C.F.R. § 483.12. 

27642 C.F.R. § 483.440(b). 

277See S. Rosenbaum et al., Community Integration: The Role of Individual Assessment, 

Center for Health Care Strategies, Inc. Working Paper (October, 2002) (noting that assessments 

implicate both coverage and liberty issues). 

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permitting (but not requiring) the state HCBS program to include levels of care that have been in 

effect in the state plan on or after passage of 1915(c) of the Social Security Act.278 

Although the proposed change is a positive development, it does not address the central problem 

of preventing unnecessary institutionalization, because the ability to handle and benefit from 

community living cannot be reduced to a level-of-care determination. Research and experience 

has shown that people whose disabilities would qualify them for a nursing facility level of care 

under any possible formulation can thrive in the community. It is important, therefore, to unhinge 

determinations about appropriateness for community placement from level-of-care 

determinations. 

In sum, CMS must thoroughly review these regulations, and, to the extent that they may be 

interpreted to be consistent with Olmstead, it should issue interpretive guidelines clarifying that 

they do allow continued institutionalization of persons who can handle and benefit from 

community services and do not oppose community placement. CMS should institute regulatory 

change of the PASARR regulations and the ICF/MR conditions of participation so that they 

cannot be used to permit continued unnecessary institutionalization 

4. NCD recommends that CMS enforce the utilization control regulation 42 C.F.R.

Part 456 Subpart I governing inspections of care in intermediate care facilities and

institutions for mental diseases to require states to identify residents of these

facilities who can handle and benefit from community living.

Title XIX regulation 42 C.F.R. § 456.609 requires inspection of care or utilization review teams 

to determine annually whether residents of intermediate care facilities and institutions for mental 

278U.S. Department of Health and Human Services, Delivering on the Promise: SelfEvaluation to Promote Community Living for People with Disabilities at III-26–27. 

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diseases need to remain in the facility or can receive services elsewhere. The regulation also 

requires—in 42 C.F.R. § 456.613—that the state take corrective action based on the findings of 

the teams.279 

Sections (b) and (c) of the regulation speak directly to unnecessary institutionalization and to the 

feasibility of providing the person with services in the community. If properly conducted, 

inspections of care should identify every resident of an ICF or an IMD who is qualified to receive 

services in the community, that is, everyone who is institutionalized unnecessarily, meaning he or 

she can handle and benefit from receiving services in the community and does not oppose 

community placement. CMS should use its leadership and regulatory authority to ensure that 

states are carrying out their inspection of care obligation in a manner that is consistent with 

Olmstead. 

5. NCD recommends that CMS use its existing regulatory authority to require

meaningful and valid assessments of nursing facility residents’ ability to handle and

benefit from community living.

Under Titles XVIII and XIX of the Social Security Act and CMS regulation, the Secretary of 

HHS must specify a minimum dataset (MDS) of “core elements” to be used by long-term care 

facilities in conducting comprehensive assessments of residents in long-term care facilities.280 

The assessment instrument used to conduct such assessments must be either the one designated 

27942 C.F.R. § 456.609. 

28042 C.F.R. § 483.20. 

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by CMS281 or an alternate assessment instrument approved by CMS.282 The comprehensive 

assessment of the person’s needs must include assessment of the person’s “discharge 

potential.”283 The section of the CMS MDS on “discharge potential” consists of the following 

items: (a) whether the resident expresses/indicates preference to return to the community; (b) 

whether the resident has a support person who is positive toward discharge; and (c) whether the 

stay is projected to be of short duration—discharge projected within 90 days (do not include 

expected discharge due to death).284 

This instrument is far too limited to serve as an accurate assessment of nursing facility residents’ 

potential to return to the community. It conditions discharge on expressed preference to return to 

the community (excluding persons who do not oppose community placement, but are unable to 

express a preference) and on the attitudes of the person’s family and friends, and it suggests that 

long-term facility residents are less appropriate for discharge than others. This section of the 

instrument is inconsistent with Olmstead and should be revised to eliminate that inconsistency. 

In sum, CMS should review its MDS and its criteria for approving alternate assessment 

instruments to ensure that the instruments are adequate to identify every nursing facility resident 

that is appropriate for community living. 

281The current Resident Assessment Instrument was designated by CMS in September 

2000. CMS, State Operations Manual, Appendix R at 3. 

28242 C.F.R. § 483.315(a). 

28342 C.F.R. § 483.315(b)(1)(xvi). 

284CMS, Resident Assessment Instrument (RAI) Version 2.0 Manual, Section Q. 

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6.	 NCD recommends that CMS exercise its look-behind authority under 42 U.S.C. 

1396a(a)(33)(B) to determine whether the states are adequately identifying residents 

of Title XIX–certified facilities who can handle and benefit from community living. 

Title XIX of the Social Security Act requires, at Section 1396a(a)(33), that states survey nursing 

facilities and ICFs/MR to determine their compliance with the conditions for participation of 

such facilities, that is, their eligibility for federal financial participation. The statute also 

authorizes “look-behind” inspections by CMS of a facility’s compliance: 

[I]f the Secretary has cause to question the adequacy of such determinations, the Secretary is 

authorized to validate State determinations and, on that basis, make independent and binding 

determinations concerning the extent to which individual institutions and agencies meet the 

requirements for participation285. In the 1980s, in response to Senate hearings that revealed 

significant noncompliance with the ICF/MR conditions of participation, HCFA conducted 

hundreds of look-behind inspections of ICFs/MR all over the country and found that 

noncompliance with the conditions and standards was widespread. CMS should similarly use its 

authority to determine whether Title XIX–certified institutions are appropriately assessing 

residents’ “discharge potential,” that is, their appropriateness for community placement as 

required by the Title XIX nursing facility standards. 

7.	 NCD recommends that HHS refocus its Real Choice Systems Change Grant 

program as a true system-change project by shifting from funding short-term 

demonstration projects to funding change that affects entire service systems. 

28542 U.S.C. § 1396a(a)(33)(B). 

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The Systems Change grants have generated a great deal of Olmstead-related activity, and it 

cannot be questioned that they have had a positive effect. However, in some of the states we 

looked at in depth, notably Washington and New Hampshire, it has proved difficult to integrate 

activities funded under a Systems Change grant with other components of the service system. 

This is inherent in the nature of a temporary, grant-funded project, which provides little incentive 

for a state to commit to lasting change in return for the grant. 

8.	 NCD recommends that HHS require the states to identify all institutionalized 

persons in the state and their need for community services. 

Whether or not HHS and CMS use their authority in the areas of utilization review, admission 

and discharge, and assessment as recommended above, HHS must require the states to identify 

all persons living in institutions (at least, those who are supported by federal public benefits) and 

their need for community services. Far too few of the states are doing this on their own, and those 

states that are doing it have generally limited identification to persons in ICFs/MR, psychiatric 

hospitals, and nursing facilities. Large numbers of people with disabilities and elders living in 

personal care boarding facilities, children in Residential Treatment Facilities, and people with 

disabilities in shelters, jails, and prisons are unidentified for the most part. To maximize 

objectivity and cost-effectiveness, identification and assessment should be carried out by 

independent agencies under contract with public agencies. 

9.	 NCD recommends that HHS publish data at regular intervals on the number of 

persons waiting for community services, as well as publish the number of people 

living in the community and in institutions. 

The availability of waiting list data has become a highly sensitive issue in many states because of 

the existence or threat of litigation. As a result of the prevalence of cases asserting either an 

Olmstead theory or the Title XIX right to receive services with reasonable promptness, states are 

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reluctant to publish or collect data on the number of institutionalized persons who could receive 

services in the community or the number of persons waiting for services in the community. Some 

states even deny that a waiting list exists or claim that it is something other than a waiting list, for 

example, a “registry.” State employees may even be reluctant to assess institutional residents 

objectively because of the concern about liability under the ADA. HHS could place states and 

stakeholders alike on a more even footing by requiring that states provide such data and by 

publishing them. 

10.	 NCD recommends that CMS use its waiver approval authority to require the states 

to minimize “institutional bias” in the choice between institutional and home- and 

community-based waiver services. 

Congress may not have intended the “institutional bias” in Title XIX service delivery, but it is 

pervasive and goes far beyond the difference between mandatory services and waived services. 

Medicaid recipients who live in nursing facilities or other institutions receive housing, meals, 

health care, pharmaceuticals, and other goods and services in addition to personal care and 

nursing services. Recipients of waiver services may not receive these additional services as part 

of the waiver package, and, in addition, they may be subject to more stringent income limits than 

institutionalized individuals. States that offer the personal care option may drastically limit the 

amount of services available (for example, to six hours a day on weekdays and none on 

weekends), and waivers may not pay for needed prescription medications or specialized 

therapies. CMS should require states to show in their waiver applications that the array of 

services in the community is sufficient to allow recipients a genuine choice between institutional 

and home- and community-based services. 

This does not mean that a state would have to offer every conceivable service under a home- and 

community-based waiver. Other means exist to ensure that the home- and community-based 

services are not so limited that recipients are forced into nursing facilities. One method is by 

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developing an array of capped waivers designed to support persons with different levels of need, 

with transfer available from one waiver to another, as the person’s needs change. Another 

method is using the personal care option to provide a basic floor of personal assistance services 

for all persons with disabilities in the state that need them, with additional services available to 

the more limited number of persons who need more intensive services. Yet another method is by 

developing individual budgets for services tied to individualized assessments, as many states 

now are doing. 

11.	 NCD recommends that CMS enforce the assurances states are required to give in 

return for funding under the home- and community-based waiver, especially the 

requirement of 42 C.F.R. § 441.302(d) that Medicaid beneficiaries who are eligible 

for services in an ICF/MR or nursing facility be notified of the feasible alternatives 

under the waiver and given the choice of services under the waiver or services in a 

facility. 

We have seen little evidence from the states that the requirement of 42 U.S.C. § 1396n(c)(2) that 

all Medicaid beneficiaries who are eligible for services (including those who are receiving those 

services and those who have applied for services and been determined to be eligible for an 

ICF/MR or nursing facility level of care) be given the choice of services under the waiver as well 

as services in a facility is honored much in practice. This is a fundamental requirement of all 

home- and community-based waiver programs, and the states are required to give assurances that 

they will fulfill this condition of waiver funding. CMS should enforce the states’ implementation 

of this requirement, just as it has in recent years actively enforced the choice of provider 

requirement. To be consistent with Olmstead, CMS’ interpretation of this statutory requirement 

should not permit a beneficiary’s guardian to choose an institutional setting for a person with 

disabilities who can handle and benefit from a home- and community-based waiver program and 

who does not oppose community placement. 

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12. NCD recommends that ED play a stronger role in Olmstead implementation. 

The response of ED to Olmstead, the Executive Order, and the New Freedom Initiative has been 

surprisingly weak. The Office of Special Education Programs needs to be much more proactive 

in addressing the problem of children with disabilities who receive their education in Residential 

Treatment Facilities and juvenile detention centers, as well as the enormous problem of those 

who leave school without appropriate transition services that offer the hope of meaningful 

employment as adults. 

The Rehabilitation Services Administration should provide VR funds to the states earmarked for 

Olmstead-related activities, for example, funding the Centers for Independent Living (CILs) to 

identify people in institutions who wish to move and providing assistance in relocation and 

diversion. Whereas the partnerships between state agencies and CILs in developing and 

implementing Real Choice Systems Change grants has been positive, the CILs should have a 

stable and well-resourced role in Olmstead implementation that is not dependent on states to 

apply for a time-limited grant. Helping people with disabilities to move from nursing homes or to 

avoid entering them in the first place is what the CILs do better than anyone else, and they do it 

with tremendous cost-effectiveness. 

13.	 NCD recommends that HHS support and fund Relocation Specialists based in 

independent advocacy organizations, such as the CILs, People First organizations, 

or similar advocacy organizations to assist people in moving from institutions and 

nursing facilities. 

Advocates have the skill, the motivation, the community connections, and the ability to provide 

peer support to people with disabilities moving from nursing facilities. It makes sense and is 

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highly cost-effective to fund advocacy organizations directly to perform this role as an alternative 

to training agency staff. 

14.	 NCD recommends that the Federal Government support and fund Protection & 

Advocacy agencies in specific Olmstead-related activities. 

Historically, advocacy has been one of the most powerful engines for change and community 

integration for people with disabilities. Just as the Social Security Administration has awarded 

Work Incentives Assistance Program grants to the designated Protection and Advocacy agencies 

in each state and territory under the Ticket to Work and Work Incentives Improvement Act of 

1999, HHS should award grants to Protection and Advocacy agencies in specific Olmsteadrelated activities. The Protection and Advocacy system already has considerable expertise and 

skill in advocating for people with disabilities who are unnecessarily institutionalized or at risk of 

unnecessary institutionalization, and Protection and Advocacy agency staff have been actively 

involved in Olmstead stakeholder groups in nearly all states with Olmstead planning groups. 

Olmstead-related grant activities could include investigation of Olmstead-related complaints; 

review of states’ assessment procedures and identification of persons with disabilities waiting for 

community services; advocacy; legal representation of people with disabilities who have been 

denied services in the most integrated setting; and systems advocacy to remove barriers to 

community integration. 

15.	 NCD recommends that federal agencies provide federal financial assistance to states 

to provide small grants to people with disabilities for transition costs from 

institutions to community. 

People with disabilities and elders leaving institutions often have little if any savings to pay the 

cost of setting up a household and to pay rent while waiting to receive housing assistance. The 

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relatively modest amounts involved (usually less than $3,000) can be an unnecessary barrier to 

community integration. Although CMS has clarified that states may cover one-time transition 

costs under a home- and community-based services waiver, this option will not cover all onetime transition costs, at least not in the short term, and will not at all cover people who are not 

eligible for home- and community-based waiver services. Grants to the states, which could be 

administered through CILs, AAAs, or other agencies that work directly with people leaving 

institutions for the community, specifically designated for one-time transition costs and 

temporary rent subsidies are a highly cost-effective way to overcome barriers to community 

placement. 

16.	 NCD recommends that HUD continue its efforts to simplify the ConPlan process, 

work to simplify other aspects of federal housing programs, and support focused 

advocacy and service brokerage for people with disabilities to access federally 

supported housing programs. 

For people with disabilities, housing is the single biggest barrier to community integration and to 

Olmstead implementation. Every stage of the process to secure federal housing assistance--from 

developing localities’ ConPlans and PHA plans to applying for Section 8 vouchers—has 

complicated, arcane procedures that make it vastly more difficult for people with disabilities to 

obtain affordable and accessible housing. The state of Mississippi recognized this problem in its 

Olmstead plan, which includes a provision for training case managers in housing facilitation. 

People with disabilities would benefit greatly from trained advocates who can participate 

effectively in the ConPlan and PHA planning process and from advocates, services brokers, and 

case managers who can help them negotiate the process of applying for housing vouchers. 

Advocates around the country who already are knowledgeable about federal housing programs 

could conduct the training. 

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Appendix


Mission of the National Council on Disability


Overview and Purpose 

The National Council on Disability (NCD) is an independent federal agency with 15 members 

appointed by the President of the United States and confirmed by the U.S. Senate. The overall 

purpose of NCD is to promote policies, programs, practices, and procedures that guarantee equal 

opportunity for all individuals with disabilities, regardless of the nature or significance of the 

disability, and to empower individuals with disabilities to achieve economic self-sufficiency, 

independent living, and inclusion and integration into all aspects of society. 

Specific Duties 

The current statutory mandate of NCD includes the following: 

�Reviewing and evaluating, on a continuing basis, policies, programs, practices, 

and procedures concerning individuals with disabilities conducted or assisted by 

federal departments and agencies, including programs established or assisted 

under the Rehabilitation Act of 1973, as amended, or under the Developmental 

Disabilities Assistance and Bill of Rights Act, as well as all statutes and 

regulations pertaining to federal programs that assist such individuals with 

disabilities, in order to assess the effectiveness of such policies, programs, 

practices, procedures, statutes, and regulations in meeting the needs of individuals 

with disabilities. 

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�

Reviewing and evaluating, on a continuing basis, new and emerging disability 

policy issues affecting individuals with disabilities at the federal, state, and local 

levels and in the private sector, including the need for and coordination of adult 

services, access to personal assistance services, school reform efforts and the 

impact of such efforts on individuals with disabilities, access to health care, and 

policies that act as disincentives for individuals to seek and retain employment. 

�Making recommendations to the President, Congress, the secretary of education, 

the director of the National Institute on Disability and Rehabilitation Research, 

and other officials of federal agencies about ways to better promote equal 

opportunity, economic self-sufficiency, independent living, and inclusion and 

integration into all aspects of society for Americans with disabilities. 

�Providing Congress, on a continuing basis, with advice, recommendations, 

legislative proposals, and any additional information that NCD or Congress deems 

appropriate. 

�Gathering information about the implementation, effectiveness, and impact of the 

Americans with Disabilities Act of 1990 (ADA) (42 U.S.C. § 12101 et seq.). 

�Advising the President, Congress, the commissioner of the Rehabilitation Services 

Administration, the assistant secretary for Special Education and Rehabilitative 

Services within the Department of Education, and the director of the National 

Institute on Disability and Rehabilitation Research on the development of the 

programs to be carried out under the Rehabilitation Act of 1973, as amended. 

�Providing advice to the commissioner of the Rehabilitation Services 

Administration with respect to the policies and conduct of the administration. 

�Making recommendations to the director of the National Institute on Disability 

and Rehabilitation Research on ways to improve research, service, administration, 

and the collection, dissemination, and implementation of research findings 

affecting persons with disabilities. 

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�

Providing advice regarding priorities for the activities of the Interagency 

Disability Coordinating Council and reviewing the recommendations of this 

council for legislative and administrative changes to ensure that such 

recommendations are consistent with NCD’s purpose of promoting the full 

integration, independence, and productivity of individuals with disabilities. 

�Preparing and submitting to the President and Congress an annual report titled 

National Disability Policy: A Progress Report. 

International 

In 1995, NCD was designated by the Department of State to be the U.S. government’s official 

contact point for disability issues. Specifically, NCD interacts with the special rapporteur of the 

United Nations Commission for Social Development on disability matters. 

Consumers Served and Current Activities 

Although many government agencies deal with issues and programs affecting people with 

disabilities, NCD is the only federal agency charged with addressing, analyzing, and making 

recommendations on issues of public policy that affect people with disabilities regardless of age, 

disability type, perceived employment potential, economic need, specific functional ability, 

veteran status, or other individual circumstance. NCD recognizes its unique opportunity to 

facilitate independent living, community integration, and employment opportunities for people 

with disabilities by ensuring an informed and coordinated approach to addressing the concerns of 

people with disabilities and eliminating barriers to their active participation in community and 

family life. 

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NCD plays a major role in developing disability policy in America. In fact, NCD originally 

proposed what eventually became the ADA. NCD’s present list of key issues includes improving 

personal assistance services, promoting health care reform, including students with disabilities in 

high-quality programs in typical neighborhood schools, promoting equal employment and 

community housing opportunities, monitoring the implementation of the ADA, improving 

assistive technology, and ensuring that those persons with disabilities who are members of 

diverse cultures fully participate in society. 

Statutory History 

NCD was initially established in 1978 as an advisory board within the Department of Education 

(P.L. 95-602). The Rehabilitation Act Amendments of 1984 (P.L. 98-221) transformed NCD into 

an independent agency. 

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