Associations between State Medicaid Waiver Program Policy Design and Use of Home and Community-Based Services (HCBS) Among Adults with Intellectual and Developmental Disabilities (I/DD)

Background/Purpose: There are few federal mandates around Medicaid-funded Home and Community-Based Services (HCBS), giving states substantial discretion in their design. Significant differences exist across states regarding enrollment, coverage, and provision of HCBS. Research is critically needed to understand the effects of specific HCBS waiver policies and program design decisions, including concurrent operation with HCBS state plan benefits, on individual-level HCBS utilization and subsequent outcomes, particularly for adults with intellectual and developmental disabilities (I/DD), who typically experience greater unmet needs and higher intensity of use of Medicaid HCBS than other user groups.

This study aims to estimate how specific state Medicaid HCBS waiver policy decisions and program design patterns (“policy packages”) are associated with use of any Medicaid-funded HCBS among adults with I/DD. We predict that there are common trade-offs in waiver program design, such as more restrictive eligibility and more generous coverage, which are associated with more significant racial/ethnic and urban/rural disparities in use of Medicaid-funded HCBS.

Methods: First, we develop a comprehensive, national policy dataset with detailed information on state Medicaid HCBS waiver programs that enrolled adults with I/DD between 2016 and 2019, drawing from publicly available state Medicaid waiver applications approved by Centers for Medicaid and Medicare Services (CMS), CMS-64 Quarterly Medicaid Statement of Expenditures for the Medical Assistance Program data, and CMS-372 Annual Reports on HCBS Waivers data. In addition to empirically identifying specific state HCBS waiver policy decisions, we use factor analysis and cluster analysis to describe patterns of HCBS policy decisions (“policy packages”), including more or less restrictive enrollment, more or less generous coverage, and more or less restrictive service provision and utilization management policies.

Second, we link this unique HCBS policy data to Medicaid Transformed Medicaid Statistical Information System Analytic Files (TAF) from 2016-2019 to conduct a series of retrospective, longitudinal analyses to estimate the effects of state Medicaid HCBS waiver policies and program design patterns (“policy packages”) on use of HCBS through both waiver programs and state plans. We use 2023 HCBS taxonomy and quality assessment tools published by the federal government and academic researchers, which enable us to identify more than 90% of HCBS waiver program claims and nearly all state plan claims.

Results: We identify significant state-level differences in HCBS waiver program policy design and use of any Medicaid-funded HCBS among adults with I/DD, with greater disparities in use of HCBS through waiver programs compared to state plans. Our findings further suggest that specific HCBS policy decisions and design patterns have differing effects on HCBS utilization, such as enrollment policies having a greater impact on any use of HCBS.

Conclusions and Implications: Specific Medicaid HCBS waiver policy decisions and program design patterns may differently contribute to use of Medicaid HCBS and disparities in utilization among adults with I/DD, accounting for state, local, and individual factors. Our findings provide tangible guidance for policymakers and directions for further research on how to structure Medicaid HCBS waiver programs to ensure appropriate and equitable use of HCBS for adults with I/DD.