CMS Final Rule and HCBS

What is Home and Community Based Services (HCBS)?

HCBS was developed to provide eligible persons with disabilities full access to the benefits of community living and offer them long-term services and supports in the most integrated settings of their choosing.

In 2014, The Home and Community-Based Services (HCBS) set forth the Final Rule regulations with the Centers for Medicare & Medicaid Services (CMS), requiring homes and programs where HCBS are delivered, to now meet new criteria to enhance the quality service delivery system. In addition to support services, the Department of Developmental Services and its partners have created a Statewide Transition Plan (STP) detailing steps toward compliance with the Final Rule by 2023. Some of these steps include provider self-assessments, virtual assessments, webinar trainings, and opportunities for compliance funding.

More information including guidance and training on the Final Rule, and to review the State’s Transition Plan, click on hyperlinks CMS HCBS, Department of Developmental Services.

Home and Community-Based Services

Home and Community-Based Services (HCBS) play a significant role in ensuring the independence and autonomy of individuals served by the regional center system. Below is a brief introduction to HCBS, including the compliance requirements (“Final Rule”) that are currently being implemented by the federal government and the State of California.

· What Is the HCBS Final Rule?
· Which Regional Center Services Are Affected?
· What Are the HCBS Requirements?
· What Does Final Rule Compliance “Look Like”?
· Information for HCBS Providers
· Latest Guidance for Providers on Ongoing Monitoring
· How Is Compliance-Related Documentation Submitted?
· HCBS Provider Resources

What Is the HCBS Final Rule?

Home and Community-Based Services (HCBS) were developed to offer support to individuals in community settings, as an alternative to institutional care. In 2014, new federal regulations, known as the “Final Rule,” were released by the Centers for Medicare & Medicaid Services (CMS), requiring homes and programs that deliver HCBS to meet certain criteria. This rule, as it was put in a CMS news release, “reflects CMS’ intent to ensure that individuals receiving services and supports through Medicaid’s Home and Community Based Services programs have full access to the benefits of community living and are able to receive services in the most integrated setting.”

Since that time, the Department of Developmental Services (DDS) and its partners (regional centers, service providers, etc.) have been working to implement the HCBS Final Rule, with full compliance now required by March 17, 2023. (The deadline was extended by one year due to the difficulties created by the COVID-19 pandemic.) Any individual or organization receiving or providing HCBS is likely to be affected by the Final Rule, as activities are happening now to help California meet the new federal requirements.

Which Regional Center Services Are Affected?

Both residential and non-residential day services will ultimately be affected by the HCBS Final Rule. Specifically, the services with the following service codes will be required to comply with the rule:

Residential Services
096 – Geriatric Facility (Residential Care Facility for the Elderly)
113 – DSS Licensed Specialized Residential Facility (Adult Residential Facilities for Persons with Special Health Care Needs)
904 – Family Home Agency
905 – Adult Residential Facility
915 – Adult Residential Facility
910 – Children’s Residential Facility; Group Home, Foster Family Home, Small Family Home
920 – Children’s Residential Facility; Group Home
Non-Residential Day Services
028 – Socialization Training Program
055 – Community Integration Training Program
063 – Community Activities Support Services
475 – Community-Based Training Provider
505 – Activity Center
510 – Adult Development Center
515 – Behavior Management Program
855 – Adult Day Care Facility
950 – Supported Employment Program-Group Services
954 – Work Activity Program


What Are the HCBS Requirements?

All settings (Residential and Non-Residential) must:

1. Provide the same level of full community access and integration for individuals receiving Medicaid HCBS as is provided for individuals not receiving Medicaid HCBS

2. Be selected by the individual from among setting options that include non-disability-specific options and, in the case of residential settings, the option for a private unit

3. Ensure an individual’s right to privacy, dignity and respect, as well as freedom from coercion and restraint

4. Optimize, but not regiment, individual initiative, autonomy and independence in life choices, including but not limited to: daily activities, physical environment and social interaction

5. Facilitate individual choice regarding services and supports, including who is to provide said services and supports

In provider-owned settings, such as Family Home Agencies (FHAs), FHA Home Providers, Community Care Licensed (CCL) Group Homes, Adult Residential Facilities, and Residential Facilities for the Elderly, there are additional requirements:

6. The unit or dwelling must be a specific physical place that can be owned, rented or occupied under a legally enforceable agreement entered into by the individual receiving services

7. Sleeping or living unit must afford privacy to the individual receiving services, including doors that can be locked by the individual, choice of roommate if the unit is shared, and the freedom to furnish or decorate the unit within the terms of the lease or other agreement

8. The individual receiving services must be given freedom and support in scheduling and activities, and must have access to food at any time

9. Individuals are able to have visitors of their choosing at any time

10. The unit or dwelling must be physically accessible to the individual receiving services

What Does Final Rule Compliance “Look Like”?

All settings that are HCBS Final Rule compliant are required to provide individuals receiving services with the opportunity to:

· Spend time in and be active in the local community

· Work alongside people who do not have disabilities

· Have choices regarding services and supports, including who will provide the services and supports

· Control personal scheduling and activities

For residential settings, specifically, individuals receiving services must have:

· Choices regarding roommates, if the space is shared

· Privacy within his, her or their own room, including the ability to the lock the door

· The ability to have visitors at any time, and to choose with whom to visit

· Individuals have the freedom and support to control their own schedules and activities and have access to food at any time

· Freedom to furnish and decorate his, her or their room

· Protection from eviction by way of a lease or legal agreement

Information for HCBS Providers

The Department of Developmental Services (DDS) has posted on their website the guidance for providers outlined in the California Statewide Transition Plan.

The California Statewide Transition Plan (STP) outlines the steps the state will take to be in alignment with the HCBS Final Rule. These steps include an evaluation of current services through a self-assessment, documentation review and sample of on-site assessments to validate the results of the assessment, input from individuals receiving services, and the completion of transition plans for services that are not in alignment with the Final Rule.

On November 22, 2023, the Department issued a directive to support regional centers in fully implementing the federal requirements for HCBS settings. The directive establishes a monitoring timeline for completion of required on-site reviews to confirm that all HCBS settings are implementing policies in compliance with HCBS settings requirements and outlines steps to support vendored service providers requiring additional assistance with implementation of those policies.

November 22, 2023 Directive

Resources and tools utilized for evaluating services such as the Self-assessment, Virtual site assessment tool, Validation and Remediation forms are available on the DDS website.

KRC will contact the affected providers accordingly with the latest guidance as released by the Department of Developmental Disabilities.

Latest Guidance for Providers on Ongoing Monitoring

The next step for providers transitioning into HCBS Final Rule compliance is to have a site visit conducted to validate the setting compliance. DDS released a guidance to regional centers dated 12/1/23, which supersedes the 11/22/23 directive regarding this subject. The regional center will be hosting a Vendor Informational Training Webinar on 1/9/24 at 10 am to 11 am to review the directive and inform providers on what to expect during the visit.

Vendor Training:

Zoom Topic: Vendor Training New Directive HCBS

Time: Tuesday Jan 9, 2024 10:00 AM-11:00AM Pacific Time (US and Canada)

Join Zoom Meeting: Link

Meeting ID: 883 2205 2109

Passcode: 229379


The Regional center will complete an on-site review of all HCBS settings (Enclosure) to verify their full compliance and implementation of the HCBS settings requirements by August 31, 2024. During the on-site

review, regional center must verify all relevant federal requirements are satisfied. Training and information, including prior assessment tools, can be found at Kern Regional Center has chosen to use the Department of Developmental Services Validation Form and Site Assessment tools. Kern Regional Center aims to work collaboratively with service providers to make efforts to immediately remediate any findings during the monitoring visit such as seeking input from individuals served on how areas of noncompliance may be corrected, completing training and/or training staff on the federal requirements and person-centered service planning, or updating any conflicting documentation to support full implementation of the federal requirements.

The regional center will be utilizing DDS’s the following assessment tools:

· A Validation form will be used for all providers who self-reported as being in full compliance, and who have provided documentation of said compliance.

· A Site Assessment will be used for providers to validate service practices demonstrate full compliance.

Moreover, there are two versions of each form, one for non-residential service providers and one for residential service providers:

· Non-Residential Provider – Validation Compliance (Enclosure 2a)

· Residential Provider – Validation Compliance (Enclosure 2b)

· Non-Residential Site Assessment (VSA Non-Residential Provider Questions)

· Residential Site Assessment (VSA Residential Provider Questions)


All providers in the DDS Directive 12/1/23, are required to complete a site monitoring visit will receive a letter via email to schedule the visit explaining what is to be expected. Once the site monitoring visit is completed a report will be generated and emailed to the provider. If the services are identified non-compliant, the report will identify the areas to remediate to meet compliance in accordance with the DDS directive 12/1/23. Additionally, the provider will receive a referral to KRC ‘s HCBS Program evaluator and/or a KRC contractor to aid in HCBS technical assistance. If affected services are provided under multiple vendor numbers, then the provider will receive a distinct letter for each vendor number.


How Is Compliance-Related Documentation Submitted?

Once completed, the form, along with any other required documentation, must be emailed to KRC’s HCBS Program Evaluator; after a careful review, KRC will submit the form and its supporting documents to DDS. (Any questions related to this process should also be sent to

HCBS Provider Resources

CMS HCBS Information

CMS Heightened Scrutiny Guidance

California Statewide Transition Plan

California DDS Website

DDS HCBS Training & Information Webpage

DDS HCBS Webinar: Strategies for Providing Services in Alignment With the Final Rule

The 2020 enacted budget contains $15 million to fund changes that are necessary for providers to come into compliance with the HCBS rules by March 2023. For more information visit the Department of Developmental Disabilities website in link below.