HCBS Reform: Community Living Over Institutions

Progressive HCBS-Home and Community Based Services Reform is Needed Now More than Ever

Home and Community Based Services have been in existence since 1981 when Congress passed the "Omnibus Budget Reconciliation Act" to create the first Medicaid waiver via section 1915C . This provided alternatives to institutional care. Since then, Medicaid Waivers, also known as HCBS, have expanded to provide alternatives to segregated settings like institutions and nursing homes. This has enabled a bigger selection of services to be offered.

Medicaid is currently the only funding source for long term services and supports for seniors and people with disabilities. It is much cheaper to support seniors and people with disabilities in the community across the lifespan than it is in segregated settings, such as Nursing Homes, however, low pay and a lack of livable wages for Direct Support Professionals erodes these benefits.

Low wages for DSP's contribute to high turnover costs, higher overtime costs, and higher usage of temporary staffing to fill gaps caused by high turnover. Lastly the instability of the Direct Care workforce also leads to higher risk of being forced into an institution or nursing home.

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To make HCBS genuinely person-centered, states should redirect growth funding to supportive apartment programs and away from congregate models that dictate schedules, staffing, and peers.

Supportive apartments are integrated settings with tenancy rights - e.g., a standard lease and the ability to lock doors - and portable services tailored to the person's goals, consistent with the HCBS Settings Rule's person-centered requirements. Concretely, states can braid Medicaid HCBS with housing resources - tenant-based Housing Choice Vouchers and Project-Based Vouchers, Section 811 Project Rental Assistance, and LIHTC allocations or set-asides to create integrated units - so housing is not contingent on a provider and services can follow the person.

Medicaid should reimburse tenancy supports (housing search, application help, landlord mediation, move-in, and housing stabilization) using existing authority outlined by CMS. States should also expand self-direction - allowing people to hire and schedule their own workers and manage an individual budget - and ensure conflict-free, person-led planning. To reduce waitlists and unbundle services from specific settings, states can leverage 1915(i) State Plan HCBS and 1915(k) Community First Choice options to finance individualized supports in ordinary apartments rather than facilities.

To help more older adults and people with disabilities live in their own homes, states should invest in technology-enabled supports - for example, Vermont's Safety Connection model, which uses remote monitoring, prompts, and on-call assistance to increase independence and reduce crisis responses. At the same time, the system must expand alternatives to guardianship so people keep their full civil rights, including the right to vote. Supported Decision-Making (SDM) lets a person make everyday and major life decisions with help from a chosen network - preserving autonomy while ensuring informed choices.

Over the last decade, the HCBS Settings Rule has pushed practice in the right direction by requiring conflict-free case management and defining what real community living should look like: autonomy, privacy, choice of services and roommates, and access to community life on the same basis as everyone else. Advocates' interviews and studies showed that many settings labeled "community" didn't feel that way in practice. Example: a "community" group home where residents can't choose meal times, must follow a fixed bedtime, need permission to have visitors, can't lock their bedroom door, or have no say in roommates. Even if the address is in a neighborhood, those conditions replicate institutional control - not true community living.

To better support people with autism and others who fall through the cracks, we need national eligibility reforms. Reliance on rigid criteria - like an IQ score of 70 or below, homelessness, or being in crisis - should be retired. IQ alone is a poor proxy for day-to-day functioning and doesn't capture the strengths and challenges many autistic people experience like cooking, cleaning, budgeting, following doctors' orders, healthy diet, ability to get and keep stable employment, and manage public benefits, prep for colonoscopy, and do at home COVID test to name a few

Our Home and Community Based Services (HCBS) system should focus on keeping people out of crisis.

Even a modest HCBS waiver package can dramatically improve outcomes - reducing unnecessary healthcare use, supporting meaningful employment, decreasing social isolation, and strengthening independent-living and executive-functioning skills. Research shows that people without HCBS have higher rates of ER visits and overall healthcare utilization; expanding HCBS access helps bring those rates down for children and adults with autism. As people age, Direct Support Professionals (DSPs) become even more critical. Some studies suggest autistic people may experience earlier onset of age-related health needs, which makes timely, community-based supports essential.

During COVID-19, many people who couldn't self-administer tests ended up seeking repeated care at urgent-care centers - far costlier than having a DSP provide support at home. Employment is similar: autistic people experience high rates of joblessness and underemployment, often because long-term job coaching is scarce. Today, Medicaid HCBS waivers are the primary source of ongoing job support; when access is limited, people are left without the assistance they need to work and advance.

Data from the 2003 to 2005 showed rising unsuccessful closures in Vocational Rehabilitation cases from 453 to 696. By contrast, supported employment - especially job carving and ongoing coaching - has proven effective in helping autistic people secure and keep jobs. Budget cuts and restrictive eligibility in HCBS too often block these pathways to success. The key is reliable access to a modest package of HCBS that covers healthy living, nutrition and stress management, transportation, problem-solving, building social connections, ongoing job coaching and career development, systems navigation, benefits maintenance, protection against financial exploitation, and mental-health support.

The more we invest in prevention and early intervention, the better the outcomes - for individuals, families, and communities. Lifetime support costs for autism are substantial, with estimates between 3.6 million to 7 million dollars per person, so smart, early investment in community supports is both humane and fiscally responsible.

Cost Effectiveness

Home- and Community-Based Services (HCBS) are far more cost-effective than segregated settings (e.g., institutions, nursing homes, sheltered workshops). Studies consistently show that the average per-person cost of HCBS is lower than institutional care. Overall spending, however, also depends on how many people are served and the acuity of those receiving supports - factors like medical complexity and behavioral or mental-health needs.

System Trends and Remaining Barriers

Since 2015, HCBS funding has surpassed institutional care as the largest source of long-term services and supports for people with disabilities - reflecting HCBS's cost advantages, the benefits of community living, and what the developmental disability community prefers. Yet true inclusion still lags because many communities lack robust infrastructure. Medicaid's institutional bias also persists: nursing facility and institutional care are entitlements, while HCBS remains optional in many states.

According to the 2025 Case for Inclusion, the average annual cost to serve a person in an institution was $313,188, compared with $49,764 for HCBS Medicaid waivers. One reason institutions cost more is staffing: state-run or privately operated institutions often pay higher wages and benefits than many nonprofit HCBS providers, increasing the institutional price tag.

The biggest barriers to closing segregated settings and expanding true community living are inadequate infrastructure, persistent attitudes, uneven public investment, and - at times - labor resistance. Attitudinal barriers may be the most stubborn: many people still treat disability as a character flaw or personal problem rather than a shared social responsibility. As the U.S. CDC notes:

"By not considering disability a personal deficit or shortcoming, and instead thinking of it as a social responsibility in which all people can be supported to live independent and full lives, it becomes easier to recognize and address challenges that all people - including those with disabilities - experience."

Negative perceptions sit at the heart of obstacles to community living. And remember: the disability community is the largest minority group - one anyone can join at any time.

A second barrier is the political economy around institutions.

Unions and other workforce stakeholders sometimes oppose closures out of concern for losing stable, well-paid jobs. Staff in remaining institutions are often state employees or private-sector workers with higher wages and benefits than many nonprofit HCBS providers, creating incentives to preserve the status quo. Still, the long-term trend shows progress: the number of Americans living in state-run institutions fell from 194,650 in 1967 to 17,596 in 2018, and by 2020, 17 states had closed all large state facilities for people with developmental disabilities. To keep moving forward, we must invest in HCBS infrastructure and the direct-support workforce so community supports are robust, reliable, and available to everyone.

A third major barrier to closing institutions and building a fully community-based system is family attitudes and the lack of future planning for when caregivers can no longer provide support.

With medical advances, many people with disabilities now outlive their parents; without proactive planning - supported decision-making, housing and service arrangements, employment supports, and backup staffing - crises can lead to institutionalization. Some families, especially those supporting people with significant disabilities or complex medical needs, still believe institutions or other segregated options (like sheltered workshops) are the only safe choice. To overcome this, we need public-awareness and peer-to-peer campaigns that showcase real success stories of people with significant disabilities who live, work, and thrive in the community using Medicaid waivers and appropriate supports. With the right supports, everyone can live and work in the community.

As Tia Nelis notes:

"Any time you segregate anybody away from the community, it's still like being in an institution. An institution is any place where you do not have control over your life or make your own decisions."

Some family groups claim segregated settings are safer for people with significant disabilities, but evidence suggests otherwise. Studies indicate that as much as 82% of reported abuse against people with intellectual and developmental disabilities occurs in institutional settings, where limited control over one's life fosters dehumanization. Segregation is rooted in the medical model of disability, which frames people as broken and in need of fixing; the focus becomes cure and treatment rather than removing the environmental and attitudinal barriers that create disability.

To build a truly community-based system, we need state and federal investments that raise Medicaid rates so providers can pay Direct Support Professionals (DSPs) a living wage, offer robust benefits, and provide comprehensive training with clear career ladders. DSP work is a profession, not a dead-end job - it creates hope and opportunity in the lives of adults with disabilities. DSPs are essential to reducing health disparities, improving mental health, strengthening belonging, and advancing community inclusion for people with developmental disabilities. To support that impact, we should:

• Housing: Expand access to affordable, accessible homes located near public transit and everyday services. Create options beyond Section 8 and launch "Home of Your Own" programs to support home-ownership.
• Employment & entrepreneurship: Strengthen supported employment with job carving and customized roles that match people's strengths. Make it easier to start a small business by cutting red tape and addressing benefit disincentives in programs like Medicaid, SSI/SSDI, SNAP, and housing vouchers - so people aren't punished for working.
• Peer leadership: Invest in peer-run self-advocacy organizations that build community, leadership, and confidence.

Taken together, these steps reduce the fear and anxiety that come with navigating public benefits and empower people with disabilities to take charge of their lives, dream big, and achieve their goals.

In the area of culture change we must create a culture that embraces the "Dignity of Risk" when it comes to creating a system that is truly person-family centered and one that operates from a strengths-based approach. Too often people with disabilities are held to higher standards than their non-disabled peers and prevented from trying and doing everyday things that non-disabled people do. We are often held to higher standard that says we can't make mistakes and must be perfect all the time. Some of the ways this shows up in the lives of people with developmental disabilities who get services includes:

• If we take the wrong bus, we may be prevented from taking the bus again by ourselves.
• A 2nd example is bouncing a check which often results in getting a rep payee or guardianship who controls our money and our lives.
• A 3rd example could be doing a summer internship out of state or moving to a new state or moving into one's own apartment.

In order to create a system that supports this by training providers and families on how best to Let Go and move away from the culture of overprotection. Life is about risk weather we have a disability or not and people with disabilities should be given equal opportunity to learn and grow from failure.

As Robert Perske warned:

"Overprotective attitudes toward people with intellectual disabilities can smother people emotionally and strip them of their dignity."

To truly move beyond segregated settings and build a person-centered, community-integrated system, we must embrace the dignity of risk. Although many places have closed institutions, institutional attitudes still show up in everyday decisions that limit people's choices. Seeing people with disabilities as people first means honoring their right to take reasonable risks, make decisions, and learn from experience - just like anyone else. Stepping outside our comfort zones is how we all grow, and it's how systems demonstrate a presumption of competence. Presuming competence means not deciding in advance what someone can or cannot do because of a disability.

The Moral Model of disability treats disability as a personal failing or even God's punishment, casting people as weak or a burden to society. It shows up when harm against a disabled person is minimized - such as lighter sentences or a "slap on the wrist" compared with the same crime against a non-disabled person - and when blame is placed on the individual. This mindset fuels violence, abuse, exploitation, and segregation, including institutionalization, sheltered workshops, and day programs that isolate people from community life. These attitudes have slowed our progress toward a truly inclusive society for all.

As we move further into the 21st century, we must move beyond the moral and medical models and embrace the social model of disability - the civil-rights view that places responsibility on society, not the individual. It is our environments, policies, and attitudes that need to change so everyone can participate. When communities are accessible, everyone benefits. Adopting the social model promotes greater autonomy, control, and empowerment; reduces stigma and strengthens belonging; increases diversity; and supports economic growth. Put into practice - through inclusive design, fair employment, and equitable health policy - the social model can go a long way toward reducing health disparities and improving employment outcomes for people with disabilities.

In conclusion, while we as a nation have come along way in advancing supports and civil rights for people with disabilities we still have a long ways to in creating a Home-Community Based service system that is truly person centered and focused on the needs, rights and wants of people with disabilities and those who support them.

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