HCBS Relief Act of 2025
HCBS Relief Act of 2025 would provide an emergency, temporary boost in federal funding for state Medicaid programs that spend on home- and community-based services (HCBS). Specifically, it adds a 10-percentage-point increase to each HCBS state's Federal Medical Assistance Percentage (FMAP) for HCBS expenditures in fiscal years 2026 and 2027, with a hard cap that the effective FMAP cannot exceed 95%. States must apply to receive this increase and meet certain requirements, including using the funds to expand and improve HCBS—not to supplant existing state funding—and to enhance workforce recruitment and retention. The Act directs a wide range of permitted activities to improve HCBS delivery, from higher provider pay and paid leave to emergency preparedness, equipment, training, interpreters, and support for families and those on waiting lists. States must report on use and outcomes by 2029 and undergo evaluation by an external contractor, with findings shared publicly and with Congress. In short, the bill is an emergency mechanism to rapidly inject federal dollars into HCBS and push states to pursue concrete improvements in access, quality, and workforce stability for home- and community-based services, while maintaining oversight and evaluation of outcomes.
Key Points
- 1Increases FMAP for HCBS states by 10 percentage points for HCBS expenditures in FY 2026-2027, capped so total FMAP cannot exceed 95%.
- 2Requires states to submit an approved application describing planned HCBS activities, timelines (funds must be used by Sep 30, 2029), non-supplanting assurances, and workforce investment goals.
- 3Approves the application within 90 days of submission if complete; once complete, the application is deemed approved.
- 4Broad set of eligible HCBS focus areas, including higher pay for home health workers and direct support professionals, paid sick/family/medical leave, hazard and shift differential pay, better job stability, addressing waiting lists, emergency supplies, travel costs, recruitment, caregiver support, training, assistive technologies, accessible information, interpreters, and continuation of HCBS after relocation from facilities.
- 5Special provisions for emergency/public health threats and disaster response, including protections for worker health and safety and finances associated with rapid response.
- 6Requires reporting to the Secretary by states in 2029 on funded activities and beneficiary impact; mandates an external evaluation of implementation, access, quality, and outcomes, with dissemination of findings to state Medicaid directors and Congress, plus public availability.
- 7Paperwork Reduction Act protections do not apply to the reporting/evaluation provisions, signaling streamlined data collection for this program.
- 8Definitions clarify who is eligible (Medicaid-eligible individuals), what counts as HCBS (a broad list of services including waivers and waivers under 1115), and the role of the Secretary and states in administering the program.