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Government offers states billions in grants to move disabled out of institutions

At a time when many states are slicing services for people with disabilities across the nation, the federal government has come through with a welcome offering: $4.3 billion in grant money that will go to states implementing programs that transition Medicaid beneficiaries out of institutions and nursing homes and into their communities.

On Tuesday, the U.S. Health and Human Services Department announced the 13 states that will be collectively receiving $45 million in grants for implementing the Money Follows the Person demonstration program this year. Recipients are: Colorado, Florida, Minnesota, New Mexico, Idaho, Maine, Massachusetts, Mississippi, Nevada, Rhode Island, Tennessee, Vermont, West Virginia. An additional $621 million is committed to these states through 2016. These are the newest states to join this program, established by the Obama administration in 2005; currently 29 other states and the District of Columbia participate.

“Our country recognized in the Americans with Disabilities Act that everyone who can live at home or community-based setting should be allowed to do so,” said HHS Secretary Kathleen Sebelius in press statement. “The Affordable Care Act provides states critical new dollars toward achieving that goal.”

All states will have access to a pool of $3.7 billion if they follow HHS rules to provide long-term services through the Community First Choice Option program. The goal of this program is to encourage states to make community living a “first choice” for Medicaid beneficiaries who need long-term care, rather than just placing people in the first available institution. Starting in October, states that comply with the rules (PDF) will get a 6 percent increase in federal matching funds through 2014. (To qualify for the matching increase, states must develop “person-centered plans” that outline how services will be provided to maintain the independence of each individual. Additionally, states must develop a council to implement these plans that must comprise people with disabilities, elderly individuals, and their representatives.) The idea of both programs is to help people with physical and/or mental disabilities live more independently, but with services and support.

Obama’s ambitious Money Follows the Person program (MFP) has thus far served fewer than originally anticipated. The 29 original states were given their grants in 2007, and many began their programs a year later with a combined goal of moving out approximately 38,000 residents by 2013. But by 2010, less than 5,800 residents had been moved nationally, according to Kaiser Health News. The Kaiser Commission on Medicaid and the Uninsured has been evaluating the program since it was implemented. The commission found that as of 2010, about a dozen states moved fewer than 60 people; Louisiana only moved 10. And Texas had the most success, moving 2,029 out of nursing homes and other facilities.

But according to the HHS, to date MFP has helped 12,000 individuals move out of institutions and back into their communities. The grants issued Tuesday are expected to help another 13,000 people.

The program was supposed to expire in 2011, but through the passage of the Affordable Care Act, it was extended through 2016. The act also loosened some of the program’s eligibility rules that were making it harder to transition people. MFP grants are distributed to states by the Centers for Medicare & Medicaid Services (CMS), which has to approve each state’s plan.

Some of the details:

  • Minnesota received the most: $13.4 million for the first year and $187.4 million through 2016.
  • Florida received $4.2 million and $35.7 million through 2016.
  • Colorado was awarded $2 million; $22.2 million through 2016.
  • New Mexico was at the bottom of the 13-state stack, getting $595,839 for the first year and $23.7 million through 2016.

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