HHS Extends ARP Spending Deadline to March 31, 2025 for HCBS Medicaid Recipients

States now have through March 31, 2025 to use the federal medical assistance percentage (FMAP) funding made available by the American Rescue Plan Act (ARPA). The announcement was made by the U.S. Department of Health and Human Services (HHS), through the Centers for Medicare & Medicaid Services (CMS), on June 3, 2022. As a reminder, Section 9817 of the ARPA provides states with a temporary 10% increase to the FMAP for some Medicaid expenditures to improve, increase, and strengthen home and community-based services (HCBS) for Medicaid enrollees who need long-term services/supports. Since the onset of the COVID-19 pandemic, the nation has become increasingly aware of the risks older Americans encounter when receiving care in a group setting. HCBS programs allow Medicaid beneficiaries to receive services in their home or community rather in than institutions or other group settings. The extension to March 31, 2025 (from what was originally a three-year period — from April 1, 2021 through March 31, 2024) provides states with another year to use the available funds.

CMS simultaneously announced updated state reporting requirements to reduce reporting burdens while ensuring that CMS continues to receive timely and updated information on state spending under the ARPA.¹ Following the update, states are only required to submit an HCBS spending narrative semiannually rather than quarterly. HCBS spending narratives are now due 75 days before the start of every other federal fiscal quarter and until the state’s funds in an amount equivalent to the enhanced FMAP received by the state have been expended. Additionally, states are no longer required to submit an HCBS spending narrative for the quarter that starts on July 1, 2022 (FY 2022 Q4). The next HCBS spending narrative will be due 75 days before the quarter beginning October 1, 2022 (FY 2023 Q1). States should note, however, that the frequency for submitting the HCBS spending plan is not changing. States must continue to submit an HCBS spending plan 75 days prior to the beginning of each federal fiscal quarter until the state’s funds in an amount equivalent to the enhanced FMAP received by the state have been expended.

For more information, please contact Hedy Silver Rubinger, Alexander B. Foster, and Kadeja A. Watts.

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¹ See CMS’s State Medicaid Director letter #22-002 available at https://www.medicaid.gov/federal-policy-guidance/downloads/smd22002.pdf (last accessed June 25, 2022).