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The federal government is giving states and providers an ultimatum to make progress on meeting the requirements of the home- and community-based services settings final rule that goes into effect in the spring.

Earlier this month, the Centers for Medicare & Medicaid Services issued a compliance warning after determining that many programs were not meeting regulatory requirements of the rule. The agency reminded states that if they are anticipating problems complying with the requirements, there is a Dec. 1 deadline to submit corrective action plans to bring the programs into compliance.

CMS also reiterated that it is sticking to its March 17 compliance deadline for its rule. The agency said that COVID-19 pandemic-related complications, such as workforce shortages, are not a justification for “failing to meet basic civil rights requirements,” including access to visitors and food and resident input on changes to service plans.

Corrective action plans, the agency said, should include information on which criteria the states are struggling to complete, excluding those criteria that protect basic civil and constitutional rights. Plans also must document what providers are doing to come into compliance, identify barriers to compliance and indicate how they are overcoming those barriers.

States unable to meet the 2023 deadline have until Jan. 1 to submit a statewide transition plan documenting efforts to adopt the new regulations, conduct provider compliance assessments, and establish processes for beneficiaries to report provider noncompliance.

Paul Williams, Argentum vice president of government relations, said that the association’s state partners will continue to monitor developments at the state level to collectively ensure that residents who participate in those “critical programs” receive the care and services they need to avoid institutional settings such as nursing homes.

“HCBS programs ensure that the most vulnerable of our nation’s seniors have opportunities for care in settings such as assisted living, where greater independence and quality of life can be maintained at a fraction of the cost to taxpayers, as compared to nursing homes and other like settings as appropriate,” Williams told McKnight’s Senior Living.

A LeadingAge spokeswoman told McKnight’s Senior Living that some states delayed making critical policy decisions and haven’t submitted final transition plans. At the same time, states are asking providers to comment on policies with little notice.

Only 17 states and Washington, DC, have received final approval from the federal government for their statewide transition plans, according to information posted as of Nov. 28 on

“If a state hasn’t made a decision about how they are going to handle critical aspects of the rule and had the dialogue with CMS about their final transition plans, it is impossible for providers to advocate for what would need to be in a corrective action plan before the Dec. 1 deadline,” the LeadingAge spokeswoman said.

A spokesperson for the National Center for Assisted Living said that assisted living providers have been “steadfast” in preparing for the HCBS final rule requirements.

“Many assisted living providers are working with their specific state to assure compliance or are considering transitioning to another type of program to serve the needs of their waiver-eligible residents,” the NCAL spokesperson said. “Our members are committed to providing person-centered planning, resident choice and access to the greater community, which are some of the hallmarks of the HCBS final rule.”

The federal government issued the HCBS settings final rule in January 2014 to ensure that beneficiaries of Medicaid-supported HCBS programs, including those in senior living communities, have full access to services in settings integrated into the community, rather than in institutional settings, such as skilled nursing facilities. Some assisted living communities provide HCBS to their residents through Medicaid waivers.

But the LeadingAge spokeswoman said that the rule has some provisions that don’t “fit neatly together with aging services.” The rule originally was focused on younger people with intellectual and developmental disabilities in mind as the primary recipients of HCBS services.

“Many individuals whose assisted living services are covered as Medicaid HCBS are receiving the services because they experience cognitive impairments,” she said. “Overall, while many of the requirements of the settings rule are important for beneficiaries’ quality of life, others simply do not make sense.”

The final rule originally was set to transition to full compliance in 2019 but was extended to 2022 and then to 2023, the latter extension due to the pandemic. States still must receive final approval of their statewide transition plans by March 17. And states and providers must be in compliance by then with all settings criteria not directly affected by public health emergency disruptions to continue receiving federal reimbursement for HCBS beyond the transition period.

CMS indicated that its recent warning was prompted by site visits revealing failures to follow person-centered service plans, gaps in worker training, insufficient integration of participants into the community, and unequal treatment of tenants in provider-owned or operated residential settings, according to the Inside Health Policy news outlet.

Williams said that Argentum and its state partners continue to monitor the results of site visits and will engage with CMS on any concerns that arise.

CMS announced some implementation adjustments to the final rule in May, including some accommodations to states and providers due to workforce challenges related to the COVID-19 public health emergency.