The Adequacy of Income Allowances for Medicaid Home and Community-Based Services

Brief

The Adequacy of Income Allowances for Medicaid Home and Community-Based Services

Abstract

Medicaid finances home and community-based services (HCBS) for lower-income older adults with disabilities, but most states require beneficiaries to contribute toward the cost of their care. States permit HCBS beneficiaries to retain some income to cover living expenses, but these income allowances are sometimes too low to support independent living. We found that 48 percent of older households with incomes below four times the federal poverty level spend more than their state’s Medicaid HCBS income allowances, and 29 percent spend at least 50 percent more than the allowances, potentially limiting program access and forcing some older adults into nursing homes.

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