States will generally have to make sure at least 80% of Medicaid payments for homemaker, home health aide and personal care services go to direct care worker compensation within six years, under the final "Ensuring Access to Medicaid Services" rule the Centers for Medicare & Medicaid Services (CMS) announced on April 22, 2024, according to a CMS fact sheet. The rule was published in the Federal Register on May 10.
What the final rule requires
- Reporting first: states must report on the share of payments for homemaker, home health aide, personal care and habilitation services spent on worker compensation. The 80% minimum does not apply to habilitation.
- Flexibility: states may set a hardship exemption for providers facing extraordinary circumstances and a separate performance level for small providers.
- Rates: states must publish the average hourly rate paid for personal care, home health aide, homemaker and habilitation services every two years, and set up an advisory group that includes direct care workers.
- Oversight: states must run a grievance process for fee-for-service home and community-based services, meet incident management standards and report on waiting lists and how quickly services start.
Why this mattered for providers and DSPs
For I/DD agencies, the key change was habilitation: it is covered by reporting and rate publication but not the 80% minimum. That left residential and day providers more room, while putting their compensation spending on the record. CMS later delayed enforcement of the grievance requirement until the end of 2027.