Sponsors (18)
The bill temporarily boosts federal matching funds to expand home- and community-based services, improve worker pay, and support caregivers—helping many Medicaid beneficiaries and frontline workers—while imposing state compliance requirements, adding short-term federal cost, and creating uneven state-level impacts due to funding caps and discretionary implementation.
Medicaid beneficiaries and people with disabilities will gain expanded access to home- and community-based services (HCBS) during FY2026–FY2027 because the federal government temporarily increases the Medicaid match to subsidize more HCBS deliveries.
Home health aides and direct support professionals are likely to see higher wages and better benefits because States receiving funds must condition rate increases on raising worker compensation and provide paid leave, hazard pay, and improved scheduling.
People with disabilities and seniors will have greater opportunity to live in community settings because States are incentivized to reduce institutionalization and resume HCBS for people moved to institutions, improving community integration.
State governments may be required to maintain prior HCBS funding levels (supplement, not supplant), which limits state budget flexibility and could force cuts or reduced investment in other state priorities.
States will face additional administrative, reporting, and oversight burdens to provide assurances and comply with program conditions, creating compliance costs and implementation complexity.
Lower-FMAP (wealthier) States may still need substantial state funds because the FMAP increase is capped at 95%, producing uneven benefits across states and potentially worsening geographic equity.
Based on analysis of 2 sections of legislative text.
Temporarily increases the Medicaid FMAP by 10 percentage points (up to 95%) for qualifying HCBS spending in FY2026–2027 for States that apply, with conditions on use and spending deadlines.
Introduced June 12, 2025 by Ben Ray Luján · Last progress June 12, 2025
Increases the federal Medicaid matching rate by 10 percentage points (capped at 95%) for qualifying home and community‑based services (HCBS) spending in fiscal years 2026 and 2027 for States that apply and are approved. States must submit an application describing planned uses and provide assurances that federal funds will be spent by September 30, 2029, and the law requires funds be used to strengthen HCBS workforce pay and benefits, expand access (including serving people on certain waiting lists), buy emergency supplies, and improve program oversight and data integrity.