Tennessee's Plan for New HCBS Spending

The American Rescue Plan Act (ARPA), passed in March of this year, is a boon for home- and community-based services (HCBS) in the US. The legislation makes significant investments in HCBS through a higher federal matching rate, which equates to an additional $157 million in funds to improve HCBS in Tennessee. With only a couple requirements for the money, states have broad latitude to determine how to best use their additional funds. 

With applications due this week, the opportunity has arrived to finally learn how the state of Tennessee plans to spend its share. Broadly, the state is using the money to draw down waiting lists for individuals with intellectual and developmental disabilities (IDD), increase family caregiver supports, invest in enabling technology, provide workforce wage increases and create financial provider referral incentives. As always, we applaud new spending that increases access and improves HCBS quality. We likewise recognize that the impact of this new spending is only as substantial as the details of its implementation allow it to be. 

Waiting Lists
The state proposes to use almost $202 million (TennCare’s proposal accounts for the entirety of federal funds, not just the additional ARPA funds) to enroll 2,000 Tennesseans with IDD in the Employment and Community First CHOICES program (ECF CHOICES) who are currently on waiting lists. The proposal states that this new enrollment serves to avoid “crisis situations” which have been typically necessary for new enrollment into ECF CHOICES previously. 

While the provision of services is better than languishing on waiting lists, ECF CHOICES is not a perfect program. For example, the program emphasizes employment first and foremost, which is not always person-centered or appropriate. Similarly, low reimbursement rates and service caps can limit the ability for program participants to receive services that they need. 

Of most concern, one caveat of the increased federal funds is that they must be spent by spring of 2024, which means that ongoing enrollment for these 2,000 Tennesseans must be funded by a different source after that point. TennCare proposes that “shared savings” from the embattled TennCare III/block grant will be used to support the larger ECF CHOICES program. TennCare III is currently the subject of a lawsuit to nullify the plan and the Centers for Medicaid and Medicare Services (CMS) is reviewing the plan with the potential to revoke approval. Further, there is no guarantee that TennCare will achieve adequate “shared savings” to pay for the larger enrollment, nor has TennCare made any promises that shared savings will be used for this specific purpose. Again, services are better than no services, but we hope to see other improvements and assurances that these new enrollees can count on this program past 2024. 

Increased Family Caregiver Supports
TennCare’s ARPA proposal sets aside $35 million to fund one-time payments of up to $3,000 to support family caregivers who provide unpaid supports to an individual in ECF CHOICES, CHOICES or a 1915(c) waiver. This money could be used to pay for respite services, adult day services, assistive or enabling technology, adaptive equipment or minor home modifications. Not all potential uses of this money are available to all waiver program participants. For example, minor home modifications are only available in CHOICES group 2 and 3 and ECF CHOICES groups 4-8. While support for unpaid family caregivers is necessary and overdue, the degree of benefit is dependent on the details of its implementation and the ease of the ability to actually receive and utilize these supports. 

Enabling Technology
In order to promote independence and community integration, TennCare proposes to invest $5.5 million in enabling technology. This expenditure is consistent with TennCare’s overall direction related to the proliferation of technology. The use of technology in ways that promote independence can be extremely beneficial to individuals with disabilities, so long as they are not used to displace needed services. TennCare also states that other benefits may be included in future spending plans, including individual employment supports, community transportation and benefits counseling. 

Workforce Investments
In a much-needed measure, TennCare’s proposal sets aside $137.5 million to increase wages for front-line workers in the CHOICES and ECF CHOICES programs. The General Assembly passed legislation this past spring to raise the wages of DSP’s serving individuals in the DIDD/1915(c) waivers, and this proposal states that the purpose of the wage increase is to even out the wages across the three programs. TennCare still has yet to calculate specific rate increases that equate to higher wages, but has identified several targeted services for which to target wage increases. Again, the impact of this effort will depend on the way in which it is implemented. 

In addition to the services targeted for wage increases, TennCare also plans to create quality incentive payments to providers for encouraging workers to complete competency-based training programs. In theory, workers would complete trainings, such as the QUILTSS institute apprenticeship program or short-term credentials through local community colleges, and provider agencies would compensate them accordingly. Provider agencies will then seek quality incentive payments to offset the cost of the increased wage. While well-trained front-line workers are invaluable, it’s unclear whether this incentive would increase participation in training programs or improve worker retention. Incentive payments could also be available for HCBS provider agencies in implementing TennCare goals, integrated employment or enabling technology use. 

Referral Incentives
In anticipation of scaling up HCBS services, TennCare proposes to offer referral incentives of $1,000 to provider agencies to help cover the costs of hiring and training new staff. The proposal also states that providers could use these funds for recruitment or retention bonuses for staff. The overall cost of these incentives is $10 million over three years. TennCare is right to recognize that providers already face a shortage of front-line workers and may suffer financially as they attempt to find, hire and develop new staff. The success of this incentive, like many of these initiatives, depends on the details of implementation. 

Overall, increased spending on home- and community-based services is necessary and welcome in Tennessee. There is no doubt that many individuals with disabilities will benefit from increased HCBS access and quality. Many of these expenditures align with the overall direction that TennCare is moving, toward integration and uniformity across waivers, proliferation of enabling technology and value-based reimbursement. 

Next, CMS will review Tennessee’s proposal within the next 30 days, and either approve or return it, and then it is up to TennCare to put the proposal into practice. Ultimately, “the devil is in the details”. It is important that TennCare, in implementing this proposal, consult with stakeholders, families and advocates in order to get these details right.