The CMS Proposed Rule: What You Need to Know Now

Published: June 2, 2023

With just over a month left to prepare responses to the Centers for Medicare & Medicaid Services (CMS) proposed rules, long term care providers continue to review the potential changes to Medicaid home and community based care services (HCBS).


The CMS proposed rule seeks to increase quality and expand access to these key long term care services. By providing funding and resources, HCBS programs provide access to a comprehensive range of services tailored to an individual’s specific needs. This may include personal care assistance, respite care, home health services, assistive technology, and various other supports that promote community living.

While Medicaid programs are required to provide nursing facility services, coverage for HCBS is a state option. One which Florida offers through its Medicaid Long Term Care Program. The state budget includes over $1.957B for HBCS services for the upcoming fiscal year.

Acknowledging that HCBS programs and providers are integral component of the healthcare delivery system, CMS is focusing on quality and accessibility for those services that enable our aging populations to remain in the community.

In 2022, CMS released its first ever quality measures for the program. The newly proposed rule would require states to establish performance targets for each of the mandatory measures in the HCBS quality measure set. Also related to quality, the proposed rules would:

  • Establish a new strategy for oversight, monitoring, quality assurance and quality improvement for HCBS programs
  • Strengthen person centered service planning and incident management systems in HCBS.

Providers are applauding CMS’s recognition that there is a direct relationship between access and quality to reimbursement rates.

Low reimbursement rates in HCBS programs often make it difficult to attract and retain skilled professionals, hampering program stability and limiting access to care.

Enhancing provider rates is essential to maintaining a sustainable and robust program. By adequately compensating providers, HCBS programs can attract and retain skilled caregivers, ensuring the continuity and availability of services. Increased rates encourage providers to expand their services, leading to improved access for individuals requiring care. Adequate reimbursement enables providers to maintain sustainable operations, invest in necessary resources, and accommodate the growing demand for services.

Without directly requiring an increase in rate, CMS hopes to achieve its goals by proposing the following:

  • Requiring states to publish the average hourly rate paid to direct care workers delivering personal care, home health aide, and homemaker services; and
    Requiring states to establish an advisory group for interested parties to advise and consult on provider payment rates and direct compensation for direct care workers.
  • CMS is also proposing a requiring that at least 80% of Medicaid payments for homemaker, home health aide, and personal care services be spent on compensation for direct care workers, as opposed to administrative, overhead, or profit expenses. While the acknowledgement of low rates has been well received, that enthusiasm has been tempered with the concern of that 80% threshold. States would report the percentages of payments spent on compensation for direct care workers on an annual basis and would also be required to publish the average hourly rate paid to direct care workers every other year. There is a real concern with implementing a one-size-fits-all model without a specific plan to increase funding in the program, may lead to providers leaving the program; the exact opposite result intended.

Visit the Federal Register to review further and/or to submit comments.