The Affordable Care Act has changed the way that Medicaid will function in the future. As such, policy makers need to understand new payment options including opportunities for home and community based services.

From the report: 

Since its enactment in 1965, Medicaid has been jointly administered and financed by the state and federal governments. Under overarching federal rules and federal oversight, states have considerable flexibility to define the operating details of their respective state Medicaid programs including eligibility standards, covered services and supplies, and provider payments and networks.

The recent federal health care reform legislation alters the federal-state Medicaid partnership in a number of important ways. For example, the Patient Protection and Affordable Care Act (ACA): (1) establishes, for the first time, national eligibility levels and enrollment standards; (2) provides additional requirements with respect to covered benefits; and 3) significantly increases federal matching dollars for the cost of care for childless adults and many parents as well as for some services. To improve the quality of care and contain Medicare and Medicaid expenditures, the ACA establishes and funds a Center for Medicare and Medicaid Innovation and authorizes more than 30 demonstrations to test new payment strategies across all payers.

Full Report: Implementing the Affordable Care Act: New Options for Medicaid Home and Community Based Services (PDF | 163 KB)

Center for Health Care Strategies, Inc. (2010). Implementing the Affordable Care Act: new options for Medicaid home and community based services. Bachrach, D.