The Centers for Medicare & Medicaid Services will work to provide states with additional time to comply with a final rule regarding the provision of home- and community-based services to Medicaid beneficiaries, new Health and Human Services Secretary Tom Price, M.D., and CMS Administrator Seema Verma, MPH, told governors in a March 14 letter.

The agency is seeking the extension “in recognition of the significance of the reform efforts underway,” they said. “Additionally, we will be examining ways in which we can improve our engagement with states on the implementation of the HCBS rule, including greater state involvement in the process of assessing compliance of specific settings.” Price and Verma did not elaborate.

The final rule, issued in January 2014, established new reimbursement criteria for home- and community-based settings with the goal of enabling Medicaid beneficiaries to receive services in settings that are integrated into the community rather than in skilled nursing facilities. Many assisted living communities have provided home- and community-based services to their residents through Medicaid waivers. Under the rule, however, certain settings — including settings located in buildings in which inpatient institutional treatment is provided, settings in buildings on the grounds of or adjacent to a public institution, or settings that isolate individuals from the broader community — are presumed ineligible for the waiver program unless they meet a heightened standard of proof.

The rule required states and all HCBS settings to comply by March 17, 2019.

States continue to work on their transition plans and determine whether certain senior living settings qualify to provide home- and community-based services. Tennessee remains the only state that has received final approval of its transition plan. Twenty-four additional states have received initial approval of their plans, meaning that they have met public comment, input and summary requirements but systemic or site-specific assessments have not yet been completed.

Price and Verma’s letter to the governors addressed other topics related to Medicaid as well, including expansion of the program under the Affordable Care Act, potential alignment of private and public insurance, the continuation of Section 1115 demonstration projects and responses to the country’s opioid epidemic.

“Today we commit to ushering in a new era for the federal and state Medicaid partnership where states have more freedom to design programs that meet the spectrum of diverse needs of their Medicaid population,” they said.