III. American Rescue Plan Act Funding Overview

In recognition of these challenges, Congress has increased funding for home care programs. The Families First Coronavirus Response Act in March of 2020, as well as the Coronavirus Aid, Relief, and Economic Security (CARES) Act in 2021 provided additional dollars that states could use for the HCBS program. Some states used federal CARES Act resources to increase wages for home care workers, at least temporarily.

In early 2021, Congress passed the American Rescue Plan Act (ARPA), providing a 10-percentage point FMAP increase, worth an estimated $12 billion, for HCBS programs. States can use this increased federal funding to “enhance, expand, or strengthen” HCBS programs. States could choose to expand eligibility, offer broader eligibility, make long term investment in HCBS infrastructure, strengthen the direct service workforce, or address the social determinants of health. States were required to submit detailed proposals to the Centers for Medicare and Medicaid Services (CMS) and for approval before they can access ARPA funds. While some states have been approved, many are still moving through the approval process. States must spend this funding by 2024.