>> Good morning. Can I ask everyone to please take your seat. Welcome to the Medicaid summit. My name is Craig Hall, I'm the Executive Director for the Massachusetts Developmental Disabilities Council. Joining me is Raquel Quezada, chairperson with Massachusetts Developmental Disabilities Council. We are pleased to co-host this summit with The Council of State Government and their eastern regional office.
This summit is in-person at the Massachusetts State House with virtual attendance optional. This summit has American Sign Language, ASL, which is accessible communication for our Deaf and hard of hearing audience members, and Communication Access Realtime Translation, CART, to ensure our event is fully accessible and inclusive to everyone. The URL will be in the chat if you wish to follow along. For those of you who are here in-person at the back of your booklet, are the links to people with -- to view ASL and CART. Now, I'll hand this over to Raquel Quezada, our chairperson.
>> Raquel Quezada: Thank you Craig. Good morning. Good morning. Yes. Yes. The agenda for today will be posted in the chat. The agenda will be begin with Sean Slone, Public Policy Manager for the The Council of State Governments. Sean will present the national landscape of H.R.1 implementation and policy issues. Following Sean will be two morning panels, and midday break, and two afternoon panels. Closing the day will be a presentation on the Medicaid Academies in Washington, D.C. offered to state legislators this August.
The lead sponsor of this summit are the co-chairs of the Joint Committee on Children, Families and Persons with Disabilities, Representative Jay Livingstone and Senator Robyn Kennedy and co-chairs of the Joint Committee on the healthcare financing, Representative John law and Senator Cindy Friedman. Each one of those legislators has earned Legislator of the Year award and are true champions for people with disabilities.
Senator Paul Mark is a co-sponsor and organizer of this summit.
I will like to ask that any of the council members who are here in attendance please stand up and raise your hand to be recognized today.
[ Applause ].
I will introduce Representative Livingstone, co-chair of the Joint Committee of Children, Families and Persons with Disabilities to offer a welcome.
[ Applause ].
>> Thank you. As she say, my name is Jay Livingstone, state representative, where we are along with neighborhoods in Boston. And I have the honor of serving as the co-chair of the Joint Committee on Children, Families and Persons with Disabilities. I'm so pleased that we have this Medicaid summit today and I thank the counsel and state governments, the Massachusetts Developmental Disabilities Council and the The Council of State Governments east chapter for make this go happen. Medicaid is incredibly important program for our country and our state.
Trump's big beautiful bill, big ugly bill made extreme changes to our Medicaid problem and it is estimated it's going to reduce spending in the country by a trillion dollars a year. And it's important to think about as we're thinking about the changes today how that goal is going to be achieved.
Congress are trying to increase pressure on the states cuts and make eligible people ineligible by having additional requirements on us. This is directly contrary to the way Massachusetts is -- everything that we've done in the legislature since I've been here, more than a decade now, things have been to try to make it easier for people to access benefits.
It's important as we think about the changes that are happening at the federal government how Massachusetts is going to continue to try to do it its way, try to make sure everyone who is eligible for a program gets the benefit of that program. Everyone who is in -- that it is done with as easy access as possible. I look forward to hearing the experts today, but I just ask you to keep that in mind.
And I was pleased to do this, I'm the only legislator available today, but we have great support for these programs with Chair Lawn from the healthcare finance committee here this morning, Leader Donato here, and he'll be back, and Chair Kennedy that I co-chair with, and Chair Friedman who is a co-chair as well. And Paul Mark who is the legislative representative to the The Council of State Governments in the legislature. So thank you for coming here and I look forward to hearing.
[ Applause ].
>> Thank you, chair Jay Livingstone. I'd like to now hand it over to Sean Slone, who's the Public Policy Manager for The Council of State Governments who will give us the national landscape.
[ Applause ].
>> Sean Slone: Thanks so much, Craig. Hello everybody. I'm Sean Slone. I'm a Public Policy Manager at CSG in Lexington Kentucky. I'm a 1989 graduate of Emerson college, by the way. Governor Mike Dukakis was our commencement speaker that year in 1989, and it was about 6 months after he lost the presidential race, his opening line, and I'll never forget this was, you know we wanted to hold the commencement at the White House this year, but we couldn't get the room. Possibly the most Dukakisie joke ever.
I'm here at the end of my 20th year working for CSG and these days it is my distinct honor to oversee our Medicaid policy activities, which I'm going to tell you a bit about this morning and this afternoon as I put into context the events of the last year in Medicaid and set the stage for the great panel discussions we have coming up.
You can go to the next slide, please. First of all, hopefully you all know at least a bit about CSG. Perhaps that we are the only organization serving all three branches of state government. Hopefully you also know that we are a region-based membership organization. Our regions are very important to us and we certainly thank Wendel for his participated nership and many years of service to the organization. It looks like Wendell may finally have a chance to retire with Matthew lions cop 1 on the job. It's his first day on the job in the New York office. He's not with us, but our friend Shirley is here, healthcare consultant for CSG. I want to thank Craig Hall and his team at thees Massachusetts Developmental Disabilities Council for putting all this together. Friends is a longtime friend of CSG and participated in many initiatives on the State Exchange on Employment & Disability, or SEED, going back to the Work Matters report if folks are familiar with that and other Veterans of that work as well in the room with us.
Since 2021, next slide, please, since 2021, I have been putting together the agendas for the Medicaid Policy Academies that we do annually in Washington Dc, usually in late summer early fall. This year it's in August, the Medicare leadership academy has been around the longest, about 15 years, for legislators around the country who chair Medicaid-relevant committees in their awe states and in recent years at the Medicaid or cabinet secretary level. We've done a second academy aimed at policymakers who aren't necessarily leading a committee or an agency, but who nevertheless have an interest in learning about Medicaid.
This year that one is called the Medicaid Foundations Academy. Then last year was the first year for a new program called the Medicaid Leaders Development Program, or MLDP for short. This is a group of selected 22 state legislators from 17 states who were recently elected and appointed to Medicaid-relevant committees. We did a series of webinars with them last year that focused on both Medicaid policy and leadership development.
And then held a policy academy specifically for them in DC last October. Right now I am in the process of writing a report to sum up that project. I'll highlight the legislators who were part of it, I'll highlight some of the same Medicaid policy challenges we're talking on today and talk about how this group has grown in leaders in many cases asserting themselves into the Medicaid going on in their states during this pivotal time. I'll come back a bit more this afternoon at the send of the summit and talk to policymakers in the room and online about how they can get involved.
Next slide, please. These are some of the highlights from one of last year's academies. At the top is our brand Dan Ike in Detroit, who leads a workshop for us on what oversight of the Medicaid program at the state level actually means and helps policymakers like yourselves understand the super powers that you have to lead the push for policy changes.
Below Ben is Tim from Mental Health America who spoke about the impact of Medicaid cuts on access to mental health services and substance use treatment. And Josh Goodman from the charitable trust who looked at how states had already begun to address Medicaid budget challenges on the horizon, even before the ink was dry on H.R.1. And on the right is Trisa from the center for healthcare strategies which put out a great series and successful strategies for states to consider in that endeavor.
Next slide, please. So as you know, under H.R.1 about 20 million enrollees ages 19 to 64 who are eligible for Medicaid will need to document at least 80 hours each month of work, volunteering, education or job training to maintain coverage. Certain people are exempt but as many have noted understanding and applying these he cans semthss are challenge as states recover losses and administrative burden. Just last week the Centers for Medicare and Medicaid Services released new guidance in the form of interim final rule on how states should roll out work requirements. Those rules are intended to clarify things like the exemptions for people who are considered medically frail, but KFF has noted the rule adopts a restrictive definition of medical frailty that differs from state's early expectations. Essentially, the exemption encompasses anyone with a serious medical condition or a disability that significantly impairs their ability to live or comply with the requirements.
And NPR reported this week that advocates believe the rule and that definition could put ongoing treatments in jeopardy for folks with cancer and HIV. Given the tight timeline for getting work requirements up and running, states have already begun plug along and making policy choices and making assumptions about what those should look like in the absence of federal guidance.
The new rule also looks at how to reach out to Medicaid beneficiaries about the changes ahead and methods for verifying Medicaid eligibility under the rule, individuals are allowed to self-atest that they're he cans tempt only once before being required to actually produce documentation, exempt. The new rule is almost 400 pages long, in case you need light reading before bed, and its complexity will add to the challenges that states face in operationalizing the requirements over the next 6 months.
Fortunately I believe CMS is doing an all-state webinar this afternoon for folks interested to discuss the rules. States are required to have their work requirement programs up and running by January 1, 2027. However, a six-state coalition of democratic Oregon nor led by Oregon governor is asking the Trump Administration to slow the roll out. We will see what comes back. . Next slide. That process of implementing work requirements has been on our agenda at CSG for much of the past year. This is a photo from a session we did at the CSG national conference in Chicago in December with two of our cohort members from the Medicaid leaders development program there in the middle, the guy with the beard is Representative Bret Barker of Iowa and Suzanne Weikle from Kansas, and someone from the Illinois Department of Health and family services and Jennifer Moore from Washington. They talked about their concerns with regard to work requirements in the Rural Health Transformation Program and how we might look back ton the significance of 2025 for the Medicaid program once H.R.1 is fully implemented in about 10 years.
Because 2025 was a pivotal and consequential year for the Medicaid program, last year we saw both the 60 th birthday of Medicaid and Medicare and the passion annualing of H.R.1. We know H.R.1 implementation will mean different things to different states. Director Whitehorn told us after the first couple years Illinois adopted the Medicare expansion they saw a 37% drop in the cost of uncompensated care for hospitals. Now, she fears that since the six-month redetermination requirements and the work requirements are focused on the ACA expansion population, those kinds of gains could be lost over time, particularly if the implementation process is not successful.
And that success is far from assured. Representative Barker from Iowa told us he's concerned about his state's antiquated IT systems and the difficulty of data sharing given those limitations. But we also learned that nonexpansion states will face their own challenges, representative Wikle from Kansas told us there is an assumption that the nonexpansion states have been somewhat held harmless by the Medicaid cuts since work requirements and redeterminations are specific to the expansion population. But states like Kansas are still going to see the limits on provider taxes and reductions in state-directed payments that are also in H.R.1 and those things will greatly impact state budgets. As I'm sure we will hear on one of our panels later, Medicaid is the number one source of federal dollars in the state budgets. If you remove a trillion dollars from that equation states are going to face significant challenges trying to backfill those losses.
Representative Wikle noted that fewer federal dollars for Medicaid will create enormous budget pressures that will ripple through K-12, transportation and higher education. If states are looking to just cut from their Medicaid budgets, there are really only three ways that they can do that. You can reduce eligibility, but you can only do that down to federal minimums. And the population -- bye-bye -- and the populations most states cover over the federal minimums are children and pregnant and postpartum women. And some of you may have seen recently the report from our friends at The Center For Children and Families in Georgetown that the number of young children uninsured is at the highest level in nearly a decade.
So reduce eligibility. You can reduce some provider reimbursement rates as many states are doing, but there are already provider shortages every where. And the third option is to reduce optional benefits, dental, vision, prescription drugs. They remind us Home and Community-Based Services that keep people in their communities and out of institutional nursing home care as they prefer, according to past surveys, are actually optional under Medicaid and not federally required. We will hear more about HCBS in our first panel this morning.
We also heard about SNAP capacity concerns and cost concerns with implementation. States are looking at upfront costs to upgrade their technology systems, hire staff and manage complex eligibility tracking processes, including verifying exemptions and stats. How much are those costs? Plitco reported costs are ranging from $4 million to $30 million to implement these requirements. In many cases these costs come as many states are already dealing with budget shortfalls.
Next slide, please. Well, here is where we are. We know Nebraska kicked off their program early, on May 1st through a state planned amendment. Arkansas is planning a so-called soft launch July 1st. Montana is aiming for July 1st as well. Iowa is looking for December 1st, a month early. Next slide.
Another area lots of folks are tracking this year is the impact of Medicaid cuts on state budgets. A couple of states saw -- prominent in budget debates. You may have led about them. Idaho's governor called for nearly $22 million in cuts to Medicaid disability services. Most of that for provider reimbursement rates for residential habitation services. The state is facing a $40 million budget shortfall this fiscal year and more than $500 million next year. When the disability cuts bill was facing opposition, law makers put doing away with Medicaid expansion on the table as a possible even more distasteful alternative.
In Missouri, there were cuts proposed in the neighborhood of $80 million for self-directed supports and structured group programs. Families fought back and got those cuts restored. Lawmakers ended up tapping the states () fund to cover the deficit. In Maine Speaker Fecto, proposed a $250 million stabilization fund but that effort was unsuccessful. In Michigan began, the governor proposed $780 million in new taxes to help cover $1 billion budget shortfall. And in North sairl the states -- new Medicaid expansion population of more than 725,000, but they eliminated health coverage for nearly 27,000 pregnant women and children. And in recent months we've seen states like California, New Hampshire, Pennsylvania and South Carolina eliminate coverage of GLP-1 for obesity treatment.
Next slide, please. But I think that it's safe to say that a number of states are getting a wake-up call this year about the impacts to Medicaid budgets. This is our friend Terry Brisken who is the Medicaid director in Maryland and spoke to us when she was at CMS. Earlier this year she told the Maryland finance committee once all the provisions in H.R.1 are implemented the state could lose out on $2.7 billion in federal funding, almost 20% of the state's current Medicaid budget of 14. Six billion. That number elicited an audible gasp in the committee room, according to news reports. And they'll be one of our co-hosts for this year's Medicaid Academies Foundation in DC this August.
Maryland governor FY 27 budget proposal by the way initially called for $150 million in cost containment measures for the developmental disabilities administration. DDA administers Medicaid waivers that let people with developmental disabilities receive services like live-in caregiver support, transportation, respite care and employment services.
I think the approved budget landed at about a $127 million cut, but that was on top of an $164 million cut to the agency in FY26. Next slide, please.
Something else that we'll be talking about later this afternoon is Rural Health Transformation. CMS on December 29th of last year announced the first year state awards from the $50 billion RHTP, the awards range from $147 million for New Jersey to 281 million for Texas, and this is a map from our friends at KFF that shows the states that received less than $100 per rural resident from the fund and those that receive more than $500 per rural resident, and Massachusetts was one of the latter.
Next slide, please. But in recent months, we've seen some all too predictable headlines, like this one from KFF health news. This one is about a rancher in Nebraska who relied on the local hospital for dialysis sessions 3 days a week until the hospital abruptly stopped offering that service. The turn in the story comes, weighs in when it notes that the five-year Rural Health Transformation Program is aimed at exploring new creative ways to approve rural health, not to help existing services stay a float. States can use only up to 15% of their funding to pay providers for patient care.
Next slide. This was another KFF Health News. This was another KFF Health News headliner earlier this year. Again all too predictable knowing the significant limitations on what the RHTP funds could be used for. Many remain concerned for states to craft initiatives as part of this program the money won't be enough to keep rural health facilities open, solve the long known structural problems associated with rural health or offset the massive cuts to Medicaid elsewhere in H.R.1. This story from North Carolina is about this place called Martin county where the local hospital abruptly closed down in 2023, and they just completely gutted the healthcare system in that community. But those are hmplet TP funds are not going to help get the facility reopened. North Carolina plans to distribute much of its allotment from the RHTP among existing health and social service organizations that remain open. There are also limitations on how much can be spent on construction and building renovations.
Next slide, please. One of the more interesting developments that we've seen during the 2026 legislative sessions and perhaps we could have predicted this, too, is that there have been some interbranch quaublees about how the RHTP money is going to be spent due to the short time frame that states had to develop their applications for funding, it was executive branch agencies that led the way. In some states it was the state Department of Health, in some places the state Medicaid agency, and in other places it was the governor's office. And we look forward to hearing later this afternoon from Aliza from executive office of HHS about what the process is here in the bay state.
Next slide, please. Each state came up with a diverse localized strategies as part of their RHTP application. Many of the initiatives were focused in four areas, technology and digital infrastructure, including expanding telehealth and remote patient monitoring. A workforce development, things like offering signing bonuses to providers, relocation assistance, transportation and child care support. Innovative care delivery, things like mobile health units and regional health hubs. And there were initiatives to address long-standing gaps in behavioral health services and chronic disease care.
Next slide, please. But after those RHTP applications and their various initiatives were approved, we have seen oversight legislation introduced in many states this session. Law makers were successful in building in oversight in Indiana and Kansas. In Mississippi the governor vetoed another bill at the behest of Dr. Oz. A proposed state sponsored health insurance plan that patients could use only after medical emergencies by declining to fund it. Elsewhere legislators, stakeholders or others asserted themselves into the process to express their reservations about how the money could be spent.
The challenge with this is that states have a limited amount of time to get RHTP initiatives up and running and demonstrate their value, because there are call-back provisions in H.R.1 if they're unable to use those funds or to show progress.
Next slide, please. So, we will hear much more about all of these issues as we move along in our program today. Here's a look at the rest of our agenda. Up next we're going to hear about HCBS and the challenges facing the direct care workforce, some I've also focused on during my time at CSG. We'll hear a panel on the new work requirements. And after lunch I'll be back to moderate panels on state budget decision-making and Rural Health Transformation, as well as to tell you how you can join us for this year's Medicaid Academies in DC. Right now I want to welcome Nicole LeBlanc from the Human Services Research Institute to moderate our first panel. And we can bring up our panelists, including Betsy Johnson and Dorothy Hiersteiner who are with us here in Boston, as well as online I think we have Dr. Joe Caldwell.
>> Nicole LeBlanc: Good morning everyone. It's good to be in the great state of Massachusetts. From a national policy -- disability policy advocacy. I wear a lot of hats. Policy Assistant for HSRI. Medicaid is a lifeline. I would not be able to survive and live without it, as somebody who has other health issues. It provides me with dental care, which -- [noise in background] I currently fall through the cracks when it comes to the area of HCBS supports. We need more access to HCBS, not less. Home and Community-Based Services needs to be an entitlement and it shouldn't be based on being at risk of institutionalization, being homeless or being somebody who needs 24/7 supervision.
I'm fast Tating our first two panels today. Our first panel is about Medicaid, HCBS and direct care workforce. To start this session, Betsy Johnson is here to read her poem called "The Mathematics of Mercy".
>> Betsy Johnson: Good morning everyone. To say that it's an honor to be here to read this poem is a complete understatement. I just want to thank Katlin and Dorothy and Alex for inviting me to share this piece. This piece really applies to put a human face to the numbers, like a trillion dollars, we don't know what to do with that number; right. So this poem really attempts to make that more pal pable. "The Mathematics of Mercy".
A direct care worker holds someone's universe for $18 an hour, lifts worlds, puts dignity back into being, her hands trembling as she reads the letter saying her client's hours have been cut, knowing somebody can't survive on spreadsheet logic. They speak of cuts in marble rims, voices that have never whispered, your therapy isn't medically necessary. To a nonverbal child, who just learned to make sounds like morning birds. In living rooms turned sacred, faces therapists pack up their tools of poenlt, weighted vests, sensory brushes, pieces of someone's future now being too expensive by men who have never seen how a body learns to trust itself. One careful touch at a time. Listen to power chairs going still, to screens falling dark and throats that borrow them for voice. To support workers saying good-bye to people who stopped being clients long ago? They were like family. Somewhere between that first smile and the last hug, while offshore accounts grow fat on the mathematics of suffering.
This is how a nation bleeds, not on battle fields, but in group homes. Not from enemy fire, but from funding gaps, where independence is too expensive and institutional beds cost less than community care. In the hauls of power they call this fiscal responsibility. As if responsibility means telling a mother her daughter can no longer see the therapist that taught her how to speak hauls as if perc means pricing dignity like a luxury good.
Every denial letter bears the signature of someone who's never seen a child take their first steps at 12, never seen the light in eyes, when words finally come. Never felt the hope of a family balanced against the coldness of cost.
Yet, in these rooms where care persists, we piece together what they tear apart, like a quilt of borrowed time. With midnight shifts and morning prayers, hands that hold when budgets say let go. It's here in this web of grace we weave, because what flows through us is stronger than their ledgers, and our stunborn refusal to ever let spreadsheets tell us what a life is worth. Thank you.
[ Applause ].
>> Nicole LeBlanc: Awesome. Well-said. Couldn't have said it any better. Our second speaker is Dorothy Hiersteiner, Dorothy is the codirector of National Core Indicators at HSRI. Take it away.
>> Nicole, I think we're actually going to start with Joe. Joe is next.
>> Nicole LeBlanc: Now turning it over to Joe Caldwell to give a presentation, Director of Community Living Policy Center at Lurie Institute for Disability Policy at Brandeis. Take it an away.
>> Joe Caldwell: Thanks, Nicole, and good morning everyone. And thanks for that amazing poem. That was a great way to kick things off. I think if someone is going to bring up the PowerPoint.
>> We're bringing it up right now.
>> Joe Caldwell: Okay.
>> Thanks, Joe.
>> Joe Caldwell: Great. So, I'm Joe Caldwell. I'm at Brandeis University. And like Nicole said, I direct a research center called the Community Living Policy Center. And what I'm going to do today is give you all just a very high-level overview of Home and Community-Based Services, just some basic information. And then I want to share a little bit of the research about cost effectiveness of Home and Community-Based Services and really what we know from the research.
So if you go to the next slide. So what are Home and Community-Based Services, or HCBS? Well, it's really a very broad range of services and supports. It can include things such as personal assistance, employment supports or day programs, home modifications, assistive technology, and other technology that help people stay at home; transportation; family caregiver supports. So it's a broad range of services and supports, but the important thing is that it helps people stay at home, remain at home, avoid going to a nursing home or an institution, and really just age with dignity and respect.
If you go to the next slide. So, how are Home and Community-Based Services provided? An important thing here is that most HCBS is provided by unpaid, you know, informal family caregivers, and there's estimates that there's over 63 million family caregivers, and the economic value of care that they provide, you know, is over a trillion dollars, and that's more than three times what we spend on Medicaid Home and Community-Based Services. So family caregivers are essential.
But when it comes to paid services and supports, you know, Medicaid is the primary payer in the United States.
If you go to the next slide. So, how many people receive Medicaid Home and Community-Based Services? And this comes from CMS. You know, it depends how you define it, but the best estimate is over 8.4 million people currently receive Medicaid Home and Community-Based Services. And this includes a lot of children and adults with intellectual and developmental disabilities, but people with physical disabilities, people with mental health disabilities, and a lot of older adults.
And this number is growing and it's been growing, and a lot of it has to do with, you know, the aging of the U.S. population. And so more and more people are needing, you know, services and supports to stay in their homes as they age. And in addition to that, there's a lot of unmet need out there. So, there are a lot of people, younger people with disabilities who need these services but are still not getting them; they're on waiting lists, and so there is a lot of unmet need out there as well.
If you go to the next slide. So I want to highlight a little bit more specific about people with intellectual and developmental disabilities, and like I said, it's important to know that most people with IDD are not getting services. They're at home with their families, and actually less than half of adults with IDD are even known to the formal service system. So they're just out there maybe not aware of services or haven't approached the formal service system yet in need of services.
And this data comes from the University of Minnesota. If you go to the next slide.
So, where do people with IDD that are receiving services, where do they live? And again, these are people that are getting services, but most people live at home with their family. So, 61% of people with IDD that are receiving services are actually living at home with family caregivers that are, you know, a lot of times supplementing the formal services that people are getting.
About 11% of people with IDD that are receiving services live in their own home, you know, their own apartment or their own home. And you know, a lot of times policymakers think that, well, all people with DD live in group homes, because they hear a lot from group home providers. But only about 15% of people with IDD live in group homes and even fewer, only 8% now live in large congregate institutional settings. We've done a lot to get away from those types of settings and move to smaller community-based settings.
If you'd go to the next slide. So, I wanted to share what's known as the institutional bias within Medicaid. And Sean talked about this a little bit in his opening remarks, but nursing homes are mandatory in Medicaid. So if people meet the eligibility criteria, the state has to provide a nursing home bed. They have to -- they have to provide it, it's mandatory.
But Home and Community-Based Services are optional. So states can limit, you know, how much HCBS they provide. They can put caps on services and supports. They can limit, you know, eligibility and who's eligible for Home and Community-Based Services. And you know, this results in a lot of state variation, so it depends on what state you live in, you know, what type of HCBS you might get, if any.
And it also results in often long waiting lists in many states for Home and Community-Based Services because states can cap these services and supports and have waiting lists. And unfortunately, what this does is it often results in a lot of people going in to more expensive nursing homes and institutions that, you know, are undesirable and nobody wants to go to a nursing home.
And you know, it results in greater cost. And like Sean said, you know, because these services are optional, you know, when budgets get tight and concerns about the budget, they're one of the first things that people look to to make cuts.
But I also want to highlight that there is a right to live in the community. The U.S. Supreme Court Olmstead decision ruled that people have a right to live in the community. So states need to be aware of this because if cutting Home and Community-Based Services or not providing Home and Community-Based Services results in people going to institutions, states could face, you know, class action lawsuits, and they have. So this is something state governments have to be aware of. It's not just the short-term savings, but you have to be concerned about the rights of people as well.
If you'd go to the next slide. This just sort of highlights, you know, like I said, the progress that we've made getting away from institutional services and moving more to home and community-based services. And this is sometimes called rebalancing, this shift to the community. And what this slide illustrates is of all the money that we're spending on Medicaid, Long-Term Services and Supports, what percentage is going to the community, and that's in the purple line, and what percentage is going to institutional settings, and that's in the green line. And you can see this is really shifted.
So, now we actually are spending most of our money in the community versus institutions, but this has really been pretty recent. I mean, if you go back just to 1990, when the Americans with Disabilities Act was passed, we were only spending 13% in the community, you know, and now it's up to 64%. So this is the good news and this is the way states have been moving.
If you'd go to the next slide. So now I'll kind of shift and talk a little bit about the cost of Home and Community-Based Services and the cost effectiveness and what we know from the research. And just on a very Basic Level, you know, we know that Home and Community-Based Services cost less than institutional services. And if you look on the far right, you know, for people with intellectual and developmental disabilities, it's pretty dramatic. The average annual cost of an institutional setting is over $146,000 a year; where, what states spend on HCBS is about a third of that. So that's one very basic way to kind of look at the costs.
If you'd go to the next slide. I think the better way to really look at costs and where we have some pretty good research is around this idea of rebalancing. So at the systems level, you know, really shifting away from nursing homes and institutions and providing more Home and Community-Based Services. And there are several studies on this with different populations, but the general theme is that, you know, it takes some time. In the short-term it might actually cost money, more money, because you're expanding HCBS, but the studies that have looked at this, you know, over about a 10-year period, states start to save money in the long run.
And why do they save money? Because, you know, they're preventing people from going into nursing homes and these most costly settings is sort of the default. And so, you know, over time states really sort of bend the cost curve and you start to see savings through the expansion of Home and Community-Based Services.
And the other thing that this slide illustrates is there's a lot of room for additional work, you know, to rebalance systems. So if you look at the colors of the states, that's how much they've sort of rebalanced or how much they're spending on the community. So the darker green are spending more in the community. You know, in the lighter green, there's a lot more room to do rebalancing. And so you can see sort of the state variations here and really the opportunity to do more rebalancing.
If you'd go to the next slide. I'll just very briefly mention there's a federal program called Money Follow the Person, and most states have this program, you know, the states that are highlighted here. And this is an essential program that helps states move people out of nursing homes back to the community and to rebalance their systems. And this program has strong bipartisan support. As you can see, it's a very popular program.
If you'd go to the next slide. The other thing we know from the research is you have to kind of look bigger, you know, not just Long-Term Services and Supports, but the rest of the healthcare system. And there is some emerging research and evidence that, you know, Home and Community-Based Services helps to reduce other things, like preventible ED visits and hospitalizations. You know, HCBS are kind of like social determinants of health, so these things like transportation and housing and like housing supports and planning supports really do make a difference on the other side, the more acute care side, so that's something to also keep in mind.
If you'd go to the next slide. Yeah, you know, what I would say is there's also just a lot of opportunities to get better outcomes for what you're spending on Home and Community-Based Services. And it kind of boils down to listening to people, you know, what they want, giving them more choice and control through things like person-centered planning and self-direction. And I think that, you know, makes systems more efficient, but it helps meet people's goals better and just, you know, better services and supports. You get better outcomes.
And the other thing that states can do is really just to improve care coordination, because a lot of people that are getting HCBS, they're not getting great care coordination across the acute care system.
And if you go to the next slide, I wanted to end with saying a little more about self-direction. You know, self-direction is a model of service direction that gives people with disabilities more control over their services so that they get to decide, you know, who they hire, including family and friends. And in some self-directed programs, people also get to control their budget and purchase things that they need, like transportation or assistive technology. And I would just say from a research point of view, I think this is one of the most evidence-based models of service provision, and it can also help address some of the workforce shortages that exist by giving people the ability to hire who they want, to hire family, to hire friends, people that understand their culture, that this can help some of the workforce crisis that Dorothy is going to talk about.
If you go to the next slide, I think. Yeah, just the key takeaways. I think family caregivers are absolutely essential. They're the backbone of the long-term care system. You know, HCBS improves outcomes and it can save money, you know, through things like rebalancing and avoiding ED visits and hospitalizations. And you know, lastly, self-direction, including the ability to pay family caregivers can improve outcomes and help address the workforce crisis.
And with that, I think that's all I have. And there's a link that you can go to our website. And we recently did a brief that kind of compiles a lot of the cost effectiveness literature, so some of the things I talked about, if you want the very specific studies, there's a brief on our website that sort of goes into more detail about those studies.
So, thank you. And I'll turn it over to Dorothy to talk about the direct care.
>> Dorothy Hiersteiner: Hello. Hi. My name is Dorothy Hiersteiner and I'm the codirector of National Core Indicators at Human Services Research Institute. I work with Nicole and Alixe you'll hear from later. I'm here to discuss an issue that is very intertwined with the tangled web of Medicaid and HCBS. I'm here to show you the state of the direct support workforce and the challenges that this workforce is facing. The drivers of those challenges and why we should care.
So you've heard a lot said from Sean and Joe about, and of course from Betsy and Nicole, about the workforce, the critical nature of the work that they do. Unfortunately, we're facing a lot of workforce challenges in this field and I'm going to tell you a little bit about it. So next slide, please. Or first slide.
I'll get started.
>> We need a minute to get those slides pulled up for you.
>> Dorothy Hiersteiner: Okay. I'm going to start anyway.
>> Yes. You can start. Thank you so much for your patience.
>> Dorothy Hiersteiner: No problem. So who are direct support workers? They go by different names in different states, but basically they play a critical role within the human service system. They provide day-to-day assistance and support to people with IDD, intellectual and developmental disabilities, aging adults, those with physical disabilities and many people with other support needs. They do many things, including providing support and supervision, supporting people to learn new things, ensuring optimal health and safety, helping with upkeep of a person's home, to assure that it's clean, safe and hazard free; supporting people with personal care and health needs; assisting with employment, education and community activities; supporting communication, decision-making and self-advocacy; and helping people build relationships and pursue personal goals.
These responsibilities are crucial and often life-sustaining. However, despite the essential nature of these workers, their wages are persist tently low, in part because, as I'm sure you know, their wages do not respond to typical labor market dynamics. As my lovely slide shows.
>> I'm so sorry.
>> Dorothy Hiersteiner: Just kidding. State Medicaid agencies and legislatures set reimbursement rates. Reimbursement rates then constrain provider revenue directly limiting employers' ability to increase pay, even when recruitment and retention pressures demand it. In other words, if Medicaid rates for services are low, wages have to be low. And as Sean Slone noted, the reimbursement rate decreases that are result from H.R.1, as we've seen in some states, where future pressure wages are lower and will contribute to more workplace challenges.
So, low wages, combined with other workplace challenges contribute to a sector with high turnover and low retention rates. The workers themselves are struggling to make ends meet -- you can go back one, please. Thank you. These workforce stability issues decrease the quality of services, importantly, and mean that people go without the critical care that they need to thrive and even survive. Next slide, please.
So, as Joe mentioned earlier, there are a lot of people -- next slide, please. That's okay -- there are a lot of people who need supports and more will need support in the future, including those with currently unmet needs. According to PHI, one of the leading resources on issues related to care giving and the workforce, there are upward of 9.3 million positions to fill in direct support between 2021 and 2031. Federal requirements to allow people more choice and opportunity in their communities, which are, of course, something that we support full-heartedly, may also impact the workforce and increase the need for support staff.
Additionally, limitations on paid family caregivers, that Joe mentioned earlier, will also increase the demand for support workers if we do not increase the state's ability to pay family caregivers and implement self-direction.
COVID brought increased attention to this workforce and the critical nature of the services that they provide. But also, brought to light a lot of the challenges faced by the workforce, like the fact that it's risky and challenging, the stress and burnout experienced by the workers, the post-COVID job market changes, such as increased wages for other jobs, pushed the sector to a breaking point because workers left to suddenly go to higher-paying jobs. And who can blame them? I'll talk more about this later, but across the country these workers are struggling with poverty. Median wage for a direct support worker was 18. 39, in 2024, which means about $37,000 a year, if that person is working 40-hour week, 52 weeks a year, meaning they have paid leave, which is not a given. And then according to PHI again, 46% relied on some form of public assistance. But I have a sneaking suspicion the percentage is a little higher than that.
Next slide, please. So why should we care? We know that people thrive, people experience a higher quality of life and higher satisfaction when they have access to a stable workforce. Once more, instability threatens the quality of services. Upcoming changes to Medicaid eligibility requirements and changes to funding based on fears of fraud and abuse will meet further challenges for service systems and the workers who are the backbone of these systems. People with disabilities will not be the only ones who are required to redocument their eligibility every 6 months. The workforce heavily relies on Medicaid and they will also be required to do that. What's more, they will often be the ones supporting the people that they're supporting to complete this paperwork. So this is a workforce that just needs a lot of attention and information at this time.
And goes without saying, direct support workers themselves are vital members of our communities and deserve wages that support a decent quality of life for themselves. So let's look at some data.
Next slide, please. Next slide, please. So the data that I'm going to show come from the NCI state of the workforce survey from 2024. These are two surveys that are responded to by provider agencies, so the people that employ the workers. If you want more information on the methodology or anything else about the surveys you can e-mail me or you can look at our websites to look at the reports.
Next slide, please. So, let's take a look at who the workforce was in 2024. All the data are from 2024. As you can see, about 50% of the workforce supporting both the IDD and AD populations was Black, and about 30% was white, while about 5% were Hispanic. This is across all of the responding states. According to the 2024 American Community Survey about the general population, which is conducted by the U.S. census, 14% of the U.S. population identifies as Black or African American. Again, these demographics do vary by state, but when compared to the U.S. population, you can see that the direct support workforce is reported to be disproportionately Black, and disproportionately female.
So, why is it important to look at demographics? The challenges faced by this workforce and reflected in this data that you'll be seeing do not exist in isolation. The workforce data you'll see are only a part of a worker's lived experience. For many direct support workers, particularly women of color, workplace challenges intersect with broader inequities related to housing, transportation, care giving responsibilities, healthcare access, and economic opportunity . Understanding the workforce through this broader lens is essential for developing policies and supports that promote both worker well-being and worker stability.
Next slide, please. Thank you. On this slide you can see that in the past few years a rapidly increasing percentage of IDD provider agencies, that is the employers of the direct care workforce, are identifying as private for-profit, while the nonprofit segment decreases. In 2024, about 62% of IDD providers that responded to our survey identified as private for-profit, while 80% of AD providers identified as such. So why do we care about this? Because the increase in private for-profit agencies may demonstrate increasing presence of private equity sector in human services.
Private equity firms are investors that purchase companies, including healthcare and disability service providers, with the goal of generating returns for their investors. This can absolutely bring new resources and expertise, but can also create pressure to prioritize financial performance alongside service quality and workforce needs. It is very important that states and state governments keep an eye on the encouraging of private equity into the human services sector. The private equity business model is driven by a uniquely high profit-seeking combined with very limited level of disclosure or regulation. So it's very important that states keep an eye on this into the future.
Next slide, please. Now, let's talk about turnover and tenure, this is very small, I apologize. The average turnover across all participating states on the IDD side was 37% and we saw a decrease from the previous year in almost all states. On the AD side the average turnover was 45%.
Regarding the tenure, which means the length of employment of direct care workers, across all states, 64% of workers left before having been employed for 1 year. 64% of workers left before having within employed for 1 year. And on the aging and physical disability side, this number was 70%.
The stability of the workforce is also indicated in the fact that 27% of IDD agencies turned away or stopped accepting new referrals in 2024, due to staffing issues. This is found from 2023. On the AD side, 18% of providers reported as such, which was also down from the year previous.
Next slide, please. So, on the Massachusetts state level, I know we're not focusing on Massachusetts, but many of us live here and work here, ADDDP, which is a provider network, conducts a yearly study into the statewide vacancy rates. Those vacancy rates have gone down; they are still much higher than the statewide vacancy rates of other industries. This really demonstrates the unique challenges faced by the human services sector in the state and beyond.
Next slide, please. So, why do we tear about turnover and tenure? I think it's pretty obvious, but turnover and tenure affect many groups that are involved in the service system. For provider agencies workforce instability costs for onboarding, training over time and can limit the ability to maintain increased programming. It can lead to potential health and safety vulnerability and impact on organizational culture. For people being served, of course, if workers are changing too often and quickly, it can decrease trust, relationship and service continuity. But turn over and tenure services as indicators of the workforce experience, the workers experience. If a large percentage of workers are leaving before 1 year of employment, as we saw, it might indicate that DSWs, direct care workers, need more training and support at the start of employment; that they don't feel connected to the work or supported financially.
This -- or emotionally. This information could be supplemented by getting data directly from the workers themselves. Obviously as well, turnover and short tenure can indicate a stressful workplace for DSWs who remain in the job. They might need to put in overtime to cover shifts. They might be called in last-minute as people quit. Are they able to form relationships with the people that they're supporting? These are really important indicators of how the workforce can be supported moving forward.
Next slide, please. Okay. Here's wages. These are the national wages. As you can see on the IDD side, the median hourly wage was $18.39 and on the AD side it was $16 an hour. All states on the NCI-IDD side saw dramatic increases in the past 4 years in their median hourly wage. On the AD side we also saw enormous increases from the states that participated in 2023 and 2024. However, I do want to point out that no state has a median wage above the MIT -- meeting or above the MIT living wage for households of one adult and zero children. So as you can see on the side of the slide here, this is the AD, the data for the aging and physical disabilities data. The green bar indicates the median hourly wage in that state. The dotted line indicates the gap between the median hourly wage and the living wage, according to the MIT living wage calculator, for one adult and zero children. So those gaps are pretty big.
I will also point out that most DSWs, direct care workers, do not live in households of one adult and zero children. Usually it is one adult with more than one child.
So next slide, please. And this is that same daed on the IDD side. The blue indicates the average wage and the green rises up to the level, the green indicates the gap at the number at the top of the green indicates the living wage of one adult and zero children. And you can see that sometimes it's not even half, the median hourly wage is not even half.
Next slide, please. We also collect information on benefits. As you can see, the IDD side, providers on the IDD side are more likely to provide these types of benefits here; however, there is wide variety of variation across states. And I'm sure you can guess that these benefits are important to ensuring that workers have the security and flexibility needed to stay in employment. And the Massachusetts ADDP survey that I cited earlier has also noted that agencies in Massachusetts are experiencing health insurance cost increases, as we all are, which has made it much harder to offer comprehensive wages and benefits to their workers.
Next slide, please. So if you're here, you know why workforce data is important, especially at this time. State governments are in a position to make policy decisions and make impact, and to support that impact data are needed to identify areas for improvement, identify strategies, defend program integrity, and fulfill federal reporting requirements. The direct care workforce, also the direct care workforce, is the foundation of quality public services. The data are clear, the direct care workforce needs change and the next step is ours.
Thank you.
[ Applause ].
>> Nicole LeBlanc: Thank you to our panels. Now we're going to get into questions. First question for Joe is, I have been trying to get HCBS in the state of Maryland for years. Many people who want and need HCBS like me are on waiting lists or are denied access -- [audio muffled] -- our community is worried that cuts to Medicaid will mean this will get any worse. What can states do to improve access, especially for many people with Autism who fall through the cracks and who need personal supports, which is essential to staying out of the ER and out of crisis?
>> Can you help Joe unmute?
>> Joe Caldwell: Yeah. That's a great question, Nicole. Yeah, you know, the first thing I would say is it's important for states to keep good data about their waiting lists. I think that's the first thing. It's really important for the state to know, you know, who needs services and so that they can plan. And sometimes states have, you know, legislators or the state Medicaid agency has set goals that we're going to take this many people this year off the waiting list and we're going to reduce it, with the goal of eliminating the waiting lists. And some states have eliminated their waiting lists.
So it's something a state should really keep data on and sort of start the plan.
The other thing I would say is a lot of states, like I said, have started serving more people living at home with their family caregivers, and providing at least some services to people, so it might be like employment supports or family caregiver supports. So it might not mean everything you need, but providing some services to people that are on the waiting lists can be a way to serve more people and, you know, at least make sure that people are getting something, and so that might be another strategy that states can take.
The other thing with waiting lists, you know, there's a lot of people with developmental disabilities that are living with aging caregivers. You know, about 25% of people with IDD are living with caregivers that are over 65 years old, so some states have prioritized certain populations, like people living with aging caregivers, because that really is a crisis situation that could happen when their caregiver passes away.
So that's another thing that many states have done.
>> Nicole LeBlanc: Great answer. My second question for Dorothy, I used to self-direct my services when I lived in Vermont and I had a lot of staff turnover. What can states do to help people to make sure those who need support staff can find and keep workers, and deal with the lack of training that comes with self-directed, you know, and dealing with people who don't always -- DSPs don't take your role seriously, for instance?
>> Dorothy Hiersteiner: That's a great question as well. There are a lot of things that states can do regarding increasing recruitment and retention of workers. One I would say is, I mean, for blue sky thinking here, which is quite a lot, I think that's the real -- the real goal of what we should be striving for.
But, again, I think that the expansion of self-direction can really be something that can help bolster the workforce, but there is regulation and requirements that do need to be put into place. We can place requirements on training for workers who are hired by people who are self-directing their supports. We can monitor wages as well. And there are other programs that have been shown to increase recruitment and retention of workers, which are mentorships, if we can help workers communicate with -- if we can help workers communicate and form relationships with other workers, they can share tips and tricks and ask about issues that they might be having, see if they can trouble-shoot together. That has been shown to help workers.
And along with that, partnerships with local school systems, like community cloejs and high schools, can help develop a pipeline to the direct care workforce career. And also, there's been a movement to create a standardized classic at the federal level so data are collected at the federal level on this workforce, which can improve state decision-making really into the direct support professional workforce, specifically supporting people with IDD.
>> Nicole LeBlanc: Great answer. Third question is for Betsy. What made you choose poetry rather than testimony or advocacy, to talk about Medicaid. I love the poem, by the way.
>> Thank you very much. I guess my answer would be that I don't really see advocacy and art as being in separate lanes. I think, you know, art connects us to issues in ways that advocacy doesn't always, and I think, you know, advocacy is very necessary, and the goal of advocacy is probably to name what systems miss. The goal of art is to make us feel it; right? So, I think that they naturally complement each other.
I also think that art has always been on the frontlines of social change, right, historically. And we need to use art in advocacy.
I also think what's powerful about poetry and maybe storytelling specifically is that it doesn't invite a rebuttal in the same way that advocacy, you know, debate and persuasion do; right. Like you can have -- we can always argue about data or statistics or ideas and have a healthy debate; but when I share a poem or if someone shares a story, especially lived experience, really the responses to asking you to listen and that's kind of it, and to really internalize the ideas.
And so personally, I feel like there is a real power in that. I think that there's a real power in having a ray of sharing lived experience or in any of the art forms as a way of just opening up people's ideas and not forming a rebuttal, necessarily, in their minds.
So I guess that's how I would answer that question.
>> Nicole, let's see if anyone in the audience --
>> Nicole LeBlanc: Any questions from the audience? Don't be shy.
>> I'm not shy. I'm from Western Massachusetts. Thank you, everybody, for the beautiful statistics and I don't know that that actually works. We'll try. Thank you very much for the beautiful statistics. Dr. Kate Jones from Western Massachusetts. I really appreciate you stating how incredibly important this stuff is to the people who not only participate or are benefits of the benefits but also the workers.
I think one of the conversations we are not having, though, is is that when you are working you are a tax-paying person. And so as I do the math on the $37,000 a year job, you're actually contributing somewhere between 3 and $4,000 on tax base, plus you're driving a car, you're going shopping, et cetera. So there is a huge economic impact to the tax base on this workforce.
And we rarely talk about how many of the people in the workforce actually make up this economic base. So if I get this correct is that if we have these massive federal tax cuts based on the fact that we don't have enough tax revenue, and yet we're getting rid of jobs that actually pay the tax revenue. Can you speak about that more of sort of the economic impact of the tax basis?
>> Nicole LeBlanc: Great question.
>> Dorothy Hiersteiner: Yes, absolutely. In fact, I'm actually working on a project in a state that I won't name, but they are actually looking at exactly this; that if they raise wages for the direct care workforce in all of its forms, not just ADD and IDD, across the whole human services sector, if they raise wages above levels at which people -- below which the workers need public benefits, what would that -- what would the economic impact of that be?
You have the money going towards wages and towards reimbursement rates, but then you actually also have this huge amount of pay going into the community in other ways through people no longer needing public benefits, for example, through people buying things, through people helping -- being more excited to be part of the workforce and having a larger workforce base.
So it's a really -- I don't have an exact number for you, unfortunately, but it is a really, really important point. And there are states -- this, by the way, is an investigation led by a state agency, so this is not an outside research organization. These are states that are actually looking into how this could benefit. So stay tuned. I'm sure a lot more information will be coming out about that. But it's a really interesting and important point, sure.
>> Joe Caldwell: Yeah. This is Joe. I'll try to find it and send it to Katlin, but Anchor, which is an organization that represents HCBS providers, they did a study or they contracted out as a study, and bakely it showed that for every dollar of Medicaid going into, you know, the system, you get like $2 return, the state economy. So that might be useful. But I think you're absolutely right, we need to make the bigger economic picture in terms of jobs, also in terms of the family caregivers, you know, their inability to work. By cutting HCBS, we're putting more pressure on family caregivers who are going to have to take time out of the workforce to provide uncompensated care. So all that has economic impacts for the economy, for the family caregivers themselves.
So I think you're absolutely right, making that bigger economic argument.
>> I had one more thing to say about that, thank you, Joe, which is that with the larger for-profit agencies across the country buying up smaller agencies, you have, for example, let's say there's a large for-profit company based in Boston that has bought up agencies throughout the country. The taxes paid by those larger organizations not going to local economy where these agencies are operating, so that's also another feature to pay attention to.
>> Sorry for me reaching in front of you. I am so sorry, we are running short on time for this panel. I want to acknowledge that the second panel we have planned is really a continuation of these conversations. So if you're able to hold on to questions until the next panel, I would really appreciate
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