Money Follows the Person Rebalancing Demonstration

Objectives: The Money Follows the Person (MFP) Rebalancing Demonstration, authorized by section 6071 of the Deficit Reduction Act of 2005 (P.L. 109-171), was designed to assist States to balance their long-term care systems and help Medicaid enrollees transition from institutions to the community. Congress initially authorized up to $1.75 billion in Federal funds through Fiscal Year (FFY) 2011. With the subsequent passage of the Patient Protection and Affordable Care Act (P.L. 111-148) in 2010, section 2403 extended the program through September 30, 2016. An additional $2.25 billion in Federal funds was appropriated through FFY 2016. Since then, section 2 of the Medicaid Extenders Act of 2019 (P.L. 116-3) added $112 million in Federal funds and changed the end date for the program from September 30, 2016 to September 30, 2021. Section 5 of the Medicaid Services Investment and Accountability Act of 2019 (P.L. 116-16) changed the additional funding appropriated through the Medicaid Extenders Act from $112 million to $132 million and section 4 of the Sustaining Excellence in Medicaid Act of 2019 (P.L 116-39) changed the additional funding appropriated through the Medicaid Services Investment and Accountability Act from $132 million to $254.5 million. Section 205 of the Further Consolidated Appropriations Act, 2020 (P.L. 116-94) and section 3811 of the Coronavirus Aid, Relief, and Economic Security Act (P.L. 116-136) provided an additional $337.5 million. Section 2301 of the Continuing Appropriations Act, 2021 and Other Extensions Act (P.L. 116-159) added $66.4 million, section 1107 of the Further Continuing Appropriations Act, 2021, and other Extensions Act (P.L. 116-215) added $6.5 million. Section 204 of the Consolidated Appropriations Act, 2021 (P.L. 116-260) added $1.253 billion, extended and made changes to the program. The Consolidated Appropriations Act, 2023 (P.L.117-328) added $1.8 billion and extends the program through September 30, 2027. Any funds remaining at the end of each fiscal year carry over to the next fiscal year, and can be used to make grant awards to current grantees through FY 2027. Any unused grant funds awarded in FY 2027 can be used through FY 2031. No additional funding will be available after the final 2027 awards are made; however, grantees will submit documentation to identify projected costs and justify expenditures on an annual basis. Grantees can request to continue transitioning MFP participants until December 31, 2029 with services being provided and eligible for MFP-enhanced match through December 31, 2030. All claiming of services must be finalized by September 30, 2031. The MFP Demonstration supports State efforts to rebalance their long-term support system so that individuals have a choice of where they live and receive services. MFP program goals are (1) increase the use of home and community-based services (HCBS) and reduce the use of institutionally-based services; (2) eliminate barriers in State law, State Medicaid plans, and State budgets that restrict the use of Medicaid funds to let people get long-term care in the settings of their choice; (3) strengthen the ability of Medicaid programs to provide HCBS to people who choose to transition out of institutions,; and (4) put procedures in place to provide quality assurance and improvement of HCBS. The demonstration provides for enhanced Federal Medical Assistance Percentage (FMAP) for 12 months for qualified home and community-based services for each person transitioned from an institution to the community during the demonstration period. Eligibility for transition is dependent upon residence in a qualified institution for more than 60 consecutive days. The State must continue to provide community-based services after the 12-month period for as long as the person needs community services and is Medicaid eligible. Under the demonstration, the State must propose a system of Medicaid home and community-based care that will be sustained after the demon