States can only use enhanced Medicaid funds from the recently passed $1.9 trillion economic stimulus package to strengthen their home- and community-based services, the Centers for Medicare & Medicaid Services revealed late Thursday in newly released guidance.

A major tenet of the package that the president signed in March is a 10% boost in the Federal Medical Assistance Percentage (FMAP) for state expenditures on HCBS. The additional federal funding allows states to “tailor HCBS enhancements based on the needs and priorities of its residents, while protecting and strengthening the HCBS workforce, safeguarding financial stability for HCBS providers, and accelerating long-term services and supports reform and innovation,” the Department of Health and Human Services said in a statement Thursday.

CMS clarified in the guidance that the additional federal funds must be used to “supplement, not supplant” existing state funds. And state funds must be used to supplement Medicaid HCBS, not pay for HCBS that is currently available. The funds must “enhance, expand, or strengthen HCBS beyond what is available under the Medicaid program as of April 1, 2021,” according to the guidance.

States can implement various activities, including HCBS service enhancements, and infrastructure and reimbursement methodologies, to improve existing HCBS programs, CMS said. Some examples of these activities are efforts to address COVID-19 related concerns, promote HCBS infrastructure development, and promote innovative long-term services and supports rebalancing concepts.

CMS is requiring participating states to submit both initial and quarterly HCBS spending plans related to the use of the increase FMAP funds, according to the guidance.