An official State of Texas website.
Medicaid home and community-based services provide opportunities for people to receive long-term services and supports in their own home or community, rather than in an institution or isolated setting.
HCBS Settings Rule
Overview of HCBS Settings Rule
In March 2014, the Centers for Medicare and Medicaid Services (CMS) issued the federal HCBS Settings Rule which added requirements for settings where Medicaid HCBS are provided.
CMS has given states until March 17, 2023, to bring Medicaid programs into compliance with the rule.
The purpose of the HCBS Settings Rule is to ensure people receive Medicaid HCBS in settings that are integrated in the community. A Medicaid HCBS setting must facilitate a person’s choice regarding services and supports and who provides them.
Medicaid HCBS settings must also be integrated in and support full access to the greater community, including opportunities to:
- Seek employment and work in competitive, integrated settings;
- Engage in community life;
- Control personal resources; and
- Receive services in the community.
The HCBS Settings Rule applies to the following Texas Medicaid programs and services:
- Community Living Assistance and Support Services (CLASS)
- Deaf-Blind with Multiple Disabilities (DBMD)
- Home and Community-based Services (HCS)
- Texas Home Living (TxHmL)
- Medically Dependent Children's Program (MDCP)
- Youth Empowerment Services (YES)
- STAR+PLUS HCBS
- Community First Choice (CFC) services
- HCBS Adult Mental Health (HCBS AMH)
Statewide Transition Plan
CMS requires states to submit a transition plan describing their planned initiatives and activities to achieve compliance with the federal HCBS settings regulations. Read HHSC’s statewide transition plan.
Addendum to Statewide Transition Plan
HHSC announces the publication of a draft addendum to the Statewide Transition Plan for public comment. Comments are due by July 14, 2025. Review the addendum (PDF).
Heightened Scrutiny
CMS presumes some settings have qualities that are institutional or isolating in nature. CMS requires states to submit evidence demonstrating that these settings are able to overcome the presumption. These settings must go through a heightened scrutiny review by CMS. Read more about heightened scrutiny requirements and Texas Medicaid HCBS settings subject to heightened scrutiny.
Transition of Day Habilitation to Individualized Skills and Socialization
HHSC has determined that day habilitation services do not meet the requirements of the HCBS Settings Rule. HHSC will replace day habilitation with a new service called individualized skills and socialization in the Home and Community-based Services (HCS), Texas Home Living (TxHmL), and Deaf Blind with Multiple Disabilities (DBMD) waiver programs. Read more about individualized skills and socialization.
Some individualized skills and socialization settings may need to undergo heightened scrutiny review. Read more about the heightened scrutiny process for individualized skills and socialization providers.
Policy Guidance
- January 10, 2024- Employment First Discovery Tool Webinar Recording
- January 10, 2024- Webinar Presentation (PDF)