HCBS is Essential for Community Care
HCBS Access is the keystone of community living. Right now, Medicaid faces cuts in federal funding which threaten HCBS services. When Medicaid has lost funding in the past, HCBS has often been one of the first programs to lose funds. It is not a required benefit under Medicaid. Developing legislation like the HCBS Access Act would require HCBS payment under Medicaid, protecting these services for the people who need them. HCBS has been critical in supporting the transition from institutional care to community living for people with disabilities.
Medicaid also faces cuts due to federal allegations that the program is spending too much on unnecessary home care. The accusations of fraud in the program have been unfounded and recklessly applied. In Hawaii, the Trump administration is threatening to close the Medicaid Fraud Control Unit that investigates fraud. This action might extend to cutting their entire state’s Medicaid program. Broad cuts to Medicaid due to fraud claims have become a method for gutting needed federal programs.
A recent Health Affairs article outlines ways that Medicaid HCBS spending is actually more cost-effective and financially secure than traditional institutional care, in the long move to community living as a national, bipartisan priority:
- “HCBS is not an open-ended entitlement. It is, by design, an institutional substitute and now a structured preventive support option embedded within Medicaid’s financing and program integrity rules.”
- “If HCBS is retrenched under the banner of fraud prevention, the likely fiscal outcome is increased institutional spending—something which would cost far more than any purported savings from new efforts to reduce fraud.”
- “Even if withholding federal Medicaid funds may be legally authorized, it is a blunt instrument that is likely to be ineffective over the long term. Such actions do not directly pinpoint fraudulent actors. Instead, they introduce fiscal instability into programs serving populations who rely on Medicaid for their safety and independence.”
In brief: Medicaid HCBS is saving money that would be spent on more costly institutional supports. Protecting home care for disabled people and older adults is necessary for ensuring health and wellbeing for thousands of Americans. Without HCBS, people are often pushed to rely on unpaid family caregivers or into institutional living arrangements. You can stay current on how home and community-based services are being impacted in your state by following the HCBS Impacts Tracker project.
Watch the recording from this past week’s webinar “The Future of Olmstead: Community Living & Care at a Crossroads” to hear from a panel of experts discussing the risks to community living in this moment. This event was organized by the Disability Economic Policy Research Consortium.
Accessing Private Insurance
People across the country want to lower the cost of health care. There is broad support for limiting hospital prices and requiring price transparency in general. As people struggle to retain their private insurance plans, new rules are limiting protections for consumers. Here’s what’s happening now:
- Federal Exchange Update: ACA Marketplace enrollment is on the decline. From 2025 to 2026, ACA enrollment has dropped 13%, with close to 3 million people losing coverage. Enrollees with disabilities will likely have to navigate higher costs, and less coverage. At the same time, insurance companies are providing consumers with less healthcare, and even fewer protections. A recent blog from the Commonwealth Fund recaps how insurance companies will be encouraged to shirk federal laws meant to protect consumer healthcare access as part of the new ACA rules.
- Employer-Sponsored Coverage: Disabled working adults who rely on their workplace for health coverage are also experiencing increases in the cost of coverage. The United States of Care reported on the increasing cost of premiums and deductibles for the average plan. In a poll of Americans, they found that over half of U.S. adults are experiencing financial strain due to a medical bill, even with their coverage.
Affording health care as a disabled American continues to be complex. In our next newsletter, we’ll return to the issue of Medicaid coverage and the roll-out of work requirements for enrollees.
The NDNRC Newsletter is published biweekly through the summer. Archives of our weekly updates are available on the NDNRC website. Follow AAHD’s other newsletters to stay current on research opportunities and policy developments supporting people with disabilities. This newsletter is supported by the American Association on Health and Disability (AAHD). Sign up to become an AAHD member today to support ongoing projects like this.