Money Follows the Person

Money Follows the Person
Name	Money Follows the Person
Type	Federal demonstration program
Established	2005
Administered by	Centers for Medicare & Medicaid Services
Country	United States

Money Follows the Person is a federal demonstration initiative designed to transition individuals from institutional settings to community-based residences. The program aims to rebalance long-term services and supports by offering funding and technical assistance to states for relocation of eligible beneficiaries. It intersects with federal legislation, Medicaid policy, and a range of advocacy and provider organizations.

Overview

Money Follows the Person operates as a demonstration under the Medicaid framework and is administered by the Centers for Medicare & Medicaid Services in coordination with state Medicaid agencies. The initiative supports transitions from nursing facilities, intermediate care facilitys, and other institutional settings to residences that allow greater community integration, aligning with outcomes emphasized by the Olmstead v. L.C. decision and the Americans with Disabilities Act of 1990. Participating states receive enhanced federal matching funds and technical assistance from entities such as the Kaiser Family Foundation, AARP, and national disability advocacy organizations.

History and Legislative Background

Money Follows the Person was authorized by the Deficit Reduction Act of 2005 and received funding through subsequent appropriations and demonstration extensions, including provisions in legislation influenced by policymakers associated with the U.S. Department of Health and Human Services and congressional committees such as the House Ways and Means Committee and the Senate Finance Committee. The program developed amid policy debates involving stakeholders like Eleanor Clift-featured advocates, think tanks like the Brookings Institution and Urban Institute, and disability rights leaders influenced by the Nationwide Independent Living Council and Autistic Self Advocacy Network. Early demonstration design drew upon precedents including the Program of All-Inclusive Care for the Elderly and initiatives promoted during administrations of presidents such as George W. Bush and Barack Obama.

Program Structure and Eligibility

Under Money Follows the Person, states create transition programs that use person-centered planning and provide services such as housing supports, home modifications, and community-based long-term services and supports drawn from Medicaid waivers like the Home and Community-Based Services Waiver and §1915(c) authorities. Eligibility typically requires residency in an institutional setting for a minimum period, clinical eligibility for institutional level of care determined by state Medicaid agencies, and voluntary consent, consistent with standards referenced by courts such as Olmstead v. L.C. and enforcement actions by the Department of Justice. Implementation involves coordination with state agencies, managed care plans such as Centene Corporation and Kaiser Permanente, and local providers including Easterseals and Centers for Independent Living.

Implementation and State Participation

Since its inception, multiple states including Ohio, Texas, California, Florida, New York, and Massachusetts have participated in Money Follows the Person demonstrations, with varying program models shaped by state legislatures, governors, and Medicaid directors. Partnerships often involve academic evaluators from Johns Hopkins University, University of Minnesota, and George Washington University to monitor outcomes, while philanthropy from organizations like the Robert Wood Johnson Foundation and technical assistance from the Administration for Community Living supports implementation. States adopt differing provider networks—ranging from large nursing chains to local nonprofits such as The Arc—and coordinate with housing authorities like the U.S. Department of Housing and Urban Development for tenancy supports.

Outcomes and Evaluations

Evaluations by research institutions including the Urban Institute, Mathematica Policy Research, and RTI International assess outcomes such as community tenure, cost neutrality relative to institutional care, and quality-of-life measures. Reported outcomes have included transitions for tens of thousands of individuals, reduced reliance on institutional beds in some states, and varied fiscal impacts on Medicaid spending tracked by analysts at the Congressional Budget Office and Government Accountability Office. Patient-centered outcomes reference functional status, social participation, and reduced hospital readmissions, with comparisons drawn to models like Program of All-Inclusive Care for the Elderly and Veterans Health Administration community initiatives.

Criticisms and Challenges

Critics including disability rights advocates, provider associations, and policy analysts have raised concerns about insufficient affordable housing, workforce shortages in home- and community-based services, and variability in state implementation influenced by governors and legislatures. Litigation and enforcement actions by entities such as the Department of Justice under the Americans with Disabilities Act of 1990 have highlighted systemic barriers to community integration. Other challenges cited by researchers at RAND Corporation and watchdog reports from the Government Accountability Office include administrative burdens, continuity of care during transition, and disparities affecting populations served by Medicaid.

Related Programs and Policy Context

Money Follows the Person exists alongside related federal and state initiatives, including the Home and Community-Based Services Waiver programs, the Money Follows the Person Rebalancing Demonstration extensions, and efforts under the Affordable Care Act. It intersects with housing policy managed by the U.S. Department of Housing and Urban Development, elder services like Older Americans Act programs, and veteran-focused transitions coordinated with the U.S. Department of Veterans Affairs. Policy debates continue among stakeholders such as the AARP, National Association of State Medicaid Directors, and national disability organizations regarding scalability, financing, and integration with broader health system reforms championed by leaders in Congress and state capitols.

Category:Health programs in the United States