Summary of Governor McAuliffe’s Proposed Budget


Summary of DD-Related Items in Gov. McAuliffe’s Proposed Budget Waiting List

  • Changes allocation of DD Waiver slots in FY18
    • Reduces Community Living Waivers for waiting list from 325 to 90 in FY18 (-235)
    • Increases Family and Individual Support Waivers from 25 to 200 in FY18 (+175)
    • Increases the Building Independence (BI) Waivers by 60 in FY18 (+60)
    • No change in number of people served, but cost savings are not used to serve more people.
  • Allows DMAS to reallocate funds to create new waivers. In the event that DMAS can demonstrate that additional Waivers mentioned above (CL, FIS and BI) can be added within appropriations, the Governor may authorize DMAS to amend the CL or FIS Waivers to add such slots.  DMAS shall seek federal approval for changes upon receiving approval from the Governor.  DMAS will report the creation of any additional Waiver slots to the Chairmen of Appropriations and Finance within 10 days.

Overtime for Consumer Directed Service Attendants:

  • Allows DMAS to authorize overtime for attendants providing CD services. Provides $8.5 million GF ($17) million to pay overtime compensation to attendants providing consumer-directed services under the Medicaid Waivers.  This amendment replaces language prohibiting overtime hours being worked by consumer-directed attendants with language that allows DMAS to pay time and half for up to 56 hours for a single attendant.

DBHDS/CSB System Assessment:

  • Provides $4.5 million to hire an independent contractor to “expedite transformation of Virginia’s community mental health system.” Funds will be used to conduct an assessment of currently available services and a gap study, in addition to a high‐level design of efforts to ensure same‐day access for individuals accessing services (mental health) through community services boards. In addition, the study will include an assessment of the effectiveness and efficiency of the Department of Behavioral Health and Developmental Services’ organizational structure. The assessment shall also review the department’s management of the services delivered by the agency or through the CSBs.  Full excerpt of budget language included at the end of this document.

DBHDS Trust Fund:

  • Appropriates 8.6 million in trust fund dollars to be used for “expenditures needed to comply with the Department of Justice Settlement Agreement, including crisis stabilization services, improving quality management, and expanding availability of community‐based housing options. These funds are anticipated to be available due to the planned sale of Northern Virginia Training Center. The majority of funds will be expended on services to individuals in the NVTC catchment area.”

Children’s Services Act (CSA):

  • Fund increasing caseload and service costs in the CSA program. Provides $44.1 million in FY17 and $44.5 million in FY 18 to fund anticipated caseload and expenditure growth for services provided to youth through the Children’s Services Act. “The program is anticipated to grow at approximately 6 percent each year, with the majority of growth occurring in the area of private special education services, which are mandated by federal law.”

Managed Care:

  • Provides funding to conduct readiness reviews for new managed care organizations (MCO). The new organizations would operate as part of the re‐procured Medallion (4.0) program, which currently serves more than 700,000 individuals. A readiness review is an impartial assessment to assess a health plan’s preparedness to operate as a Medicaid MCO.
  • Expands Ombudsman services to meet federal MLTSS requirements. Adds 6 positions to expand the State Office of Long-Term Care Ombudsman to support Medicaid Managed Long Term Services and Supports (MLTTS) program, known as CCC Plus when it is implemented in Virginia.

Children’s Crisis:

  • Provide for $1M “to divert and discharge children from the Commonwealth Center for Children and Adolescents.” HHR Budget Summary states that it will be used to purchase private inpatient beds and create community‐based service plans for those children who have been deemed ready for discharge.

Training Center:

  • Make infrastructure repairs at state facilities ($7 million). Provides funds for the repair and/or replacement of deteriorating infrastructure, failing HVAC systems, and outdated security systems at facilities operated by the Department of Behavioral Health and Developmental Services.


  • Reduce unobligated funding at state training centers ($2,500,000 GF). Captures unobligated funding available as a result of the closure of Northern Virginia Training Center.


  • Licensing Fee. Directs DBHDS to promulgate emergency regulations establishing a nonrefundable fee for the initial application and a nonrefundable license renewal fee per application for all adult behavioral health and developmental services licensed by the department.


  • Fund adult services and adult protective services case management system operations. Covers the on‐going operating costs associated with replacing the current case management system being used by adult services and adult protective services) workers. While the Department for Aging and Rehabilitative Services (DARS) is leveraging federal grant funds to implement the new system, on‐going general fund support is needed to cover licensing and support costs.
  • Reduces Long Term Employment Support Services (LTESS) by $375,000 in FY17 by $10,661 in the second year.
  • Reduces funding for training individuals whose cost cannot be covered by federal vocational rehabilitation

Other Items:

  • Provides $250,000 to contract with Birmingham Green for long term care.
  • Adjust institutional rate setting/auditing scope of work consistent with payment methodology changes. Transitions to more price‐based (less cost‐based) payment systems has reduced the need to audit costs, so the agency can revise the scope of institutional provider rate setting and auditing.
  • Conduct audits of “DME” and pharmacy services with agency staff. Assumes that more durable medical equipment (DME) and pharmacy audits will be performed using agency staff. The shift to managed care reduces fee‐for‐service business, lowers the volume of services DMAS needs to audit, and makes it possible for the agency to complete more audits using agency staff and a reduced number of contracts with vendors.


Medicaid Expansion Language;

“5. a. Notwithstanding §30-347, Code of Virginia, or any other provision of law; should the Patient Protection and Affordable Care Act, Pub. L. No. 111-148, 124 Stat. 119 (2010) be continued, amended or replaced through federal law or regulation, such that an enhanced federal medical assistance percentage (FMAP) rate is available for newly eligible individuals, the Governor, on or after October 1, 2017, shall have the authority to direct the Department of Medical Assistance Services (DMAS) to amend the State Plan for Medicaid Assistance under Title XIX of the Social Security Act, and any waivers thereof, to implement such changes.

  1. The department shall have authority to implement the coverage provisions outlined in JJJ.5.a. of this Item prior to the completion of any regulatory process in order to effect such changes.
  2. All savings accruing to any state agency of the Commonwealth of Virginia due to the implementation of the provisions included in JJJ.5.a. or JJJ.5.b. of this Item shall not be expended but shall be unallotted and reserved for appropriation by the General Assembly.”

ITEM 284- System Assessment

E.1. Out of this appropriation, $4,500,000 the second year from the general fund shall be used for the Office of the Secretary of Health and Human Resources (OSHHR) to procure an independent contractor to expedite transformation of Virginia’s community mental health system. Such contract shall be entered into in consultation with the Virginia Association of Community Services Boards (VACSB), the Virginia Department of Corrections, the Virginia Sheriffs Association, and the Virginia Association of Regional Jails. The goal of Virginia’s community mental health system transformation is to ensure access, quality, consistency, and accountability across all forty Community Services Boards (CSBs) and Behavioral Health Authorities. The contract shall include a current state assessment, gap analysis, and high-level design of Same Day Access. The request for proposals shall be issued as soon as possible, but not later than 45 days after the enactment of this act, and include requirements for the following components: (1) Documented Vision of Transformation including expectations for partnerships with private providers; case management; care coordination; primary care and behavioral health integration; mobile crisis; and services for children, geriatrics, and veterans. The vision shall be based on the STEP-VA plan for system transformation, excellence, and performance in Virginia. (2) A Current State Analysis of all forty CSBs and Behavioral Health Authorities that includes an understanding of existing community resources; population needs including the behavioral health needs of incarcerated or otherwise criminal justice involved individuals; availability of private providers; transportation resources; governance; culture; challenges; and current processes, technology, and data and analytic capabilities. (3) A Gap Analysis indicating the difference between the Vision of Transformation and the Current State for each CSB. (4) High-Level Design to support implementation for Same Day Access including development of a clinical process flow, administrative process, and job design. (5) An analysis of the cost of such design compared to existing resources and funding streams.

  1. The contract shall also include an assessment of the efficiency and effectiveness of the Department of Behavioral Health and Developmental Services’ organizational structure. The assessment shall review the department’s management of the services delivered by the agency or through the community services boards. The study shall include an evaluation of the adequacy of existing administrative resources and identify gaps in funding and staffing required to perform assigned statutory responsibilities, including the management of the community contracting division and operation of state mental health facilities and training centers, and recommendations for improved performance. The assessment shall also review and make recommendations as to the optimal agency service delivery structure including the creation of separate behavioral health and developmental disability agencies. In developing recommendations, the contractor shall incorporate the transformation of the service delivery system referenced in paragraph E.1 of this Item.
  2. The Department of Behavioral Health and Developmental Services in partnership with the CSBs and VACSB shall provide necessary information in a timely manner as requested by the contractor. The contract shall require that the contractor submit a preliminary report within 90 days after signing the contract that includes its detailed project plan and progress to date. The contract shall also require that the assessment, design and analysis be completed by July 1, 2018, and a final report submitted by October 1, 2018, to the Governor and the Chairmen of the House Appropriations and Senate Finance Committees.
  3. In developing the report, the contractor shall examine and include information and recommendations provided by the Joint Subcommittee to Study Mental Health Services in the Twenty-first Century, established pursuant to SJ 47 (2014 General Assembly).
  4. The Governor shall appoint a committee comprised of eleven members to include six gubernatorial appointees, three appointees of the Speaker of the House of Delegates, and two appointees of the President Pro Tem of the Senate to oversee progress on the specific actions funded in this Item as well as progress on transformation of the mental health system in Virginia and the evaluation of the department. Gubernatorial appointees shall include the Secretary of Health and Human Resources and the Secretary of Finance. The Contractor shall provide periodic progress reports to the committee at the call of the committee chair.


Overview of CMS Home and Community Based Services Regulations

Sharing the latest from the VA Dept. of Behavioral Health and Developmental Services . . . 

In January 2014, the Centers for Medicare & Medicaid Services (CMS) issued a final rule for home and community based services (HCBS) that requires states to review and evaluate home and community based (HCB) settings, including residential and non-residential settings. The HCBS final regulation, published January 16, 2014 and available at 00487.pdf, requires states to prepare and submit a Statewide Transition Plan. CMS asked that statewide transition plans specifically address only the settings requirements of the HCBS regulations.

According to the HCBS regulations (section 441.530), the following characteristics must be present in all settings where HCBS are provided in order for a setting to be considered HCB[1]:

  • It is integrated in and supports full access to the greater community;
  • It is selected by the individual from among a variety of setting options;
  • It optimizes autonomy and independence in making life choices;
  • It facilitates individual choice in selecting both services and service providers; and,It ensures individuals rights of privacy, dignity, respect, and freedom from coercion and restraint.

Furthermore, individuals living in provider owned or operated residential settings must:

  • Have a lease or other signed legally enforceable agreement providing similar protections;
  • Have access to privacy in their sleeping units;
  • Have entrances lockable by the individual, with keys provided to appropriate staff as needed;
  • Have a choice in selecting their roommate(s), if they share a room;
  • Have the freedom to decorate and furnish their sleeping and/or dwelling unit;
  • Have the ability to control their daily schedules and activities and have access to food at any time;
  • Be able to have visitors at any time; and,
  • Be able to physically maneuver within the setting (e.g., setting is physically accessible).

Any modifications made to any of the above criteria for provider-owned and operated residential settings must be the result of identified individual-specific needs discovered through an independent assessment, and then documented and justified in a person-centered service plan.

The HCBS regulations give states time to “transition” to meet settings requirements. States have until March 2019 to assure compliance of all settings. Virginia’s Statewide Transition Plan expects to reach full compliance by March 2019. During the period covered by the Statewide Transition Plan, Virginia can continue to operate waivers in existing settings that do not yet meet the HCBS regulation’s settings requirements.

Virginia has redesigned its Medicaid HCBS Waivers for people with intellectual or developmental disabilities (I/DD). Effective September 1, 2016, the ID Waiver became the Community Living (CL) Waiver, the Individual and Family Developmental Disabilities Support (DD) Waiver became the Family and Individual Supports (FIS) Waiver, and the Day Support Waiver became the Building Independence (BI) Waiver. These waivers are currently operating under emergency regulatory authority. The permanent regulations will require compliance with each of the setting provisions in the HCBS regulations. The permanent regulations are targeted to become effective in February 2018. Upon the effective date of the permanent regulations, all providers will need to be in full compliance with the HCBS settings requirements.

CMS requires states to report on the current compliance status of HCBS settings. Beginning in March of 2017, ALL providers of Medicaid CL, FIS or BI waiver services in impacted settings will be required to complete and submit a HCBS compliance self-assessment for each setting where they provide HCBS services. Impacted settings include: group home residential settings, sponsored residential settings, supported living settings, group day settings and group supported employment settings.

The state will provide service providers with technical assistance and guidance to assist their efforts of bringing non-compliant settings into full compliance. Providers should take the initiative to become educated on the CMS HCBS regulations’ settings provisions and requirements. There are many resources and technical assistance documents available on CMS, DBHDS and DMAS websites.

Information & Resources

Frequently Asked Questions Regarding the Heightened Scrutiny Review Process and Other Home and Community-Based Settings Information

[1] This is an abbreviated list, see CFR section 441.530 for entire list of requirements.


Waiver Redesign Summary, July 2016

Summary of Major I/DD Items in the Conference Committee Report


The Budget Conference Committee completed its work on Virginia’s Budget Bill this week and posted their amendments on Wednesday evening.  The House and Senate members now have 48 hours to review, which means the final vote on the budget bill will take place this evening or tomorrow morning.

Once the General Assembly has its vote on the conference committee report, the Governor will have the opportunity to review all budget items, suggest amendments or veto an item.  The General Assembly will convene again on April 20 to vote on the Governor’s amendments to the final budget bill.  The state budget is to take effect July 1.

Major I/DD Items in the Conference Committee Report:

  • Provides additional funding for the Early Intervention- Part C program ($1.7M in FY17  and $2.5M in FY18).



  • Provides additional I/DD Waiver slots.  Supports the Governor’s proposal to provide 855 Waivers required by the DOJ agreement, but eliminates the 100 proposed “reserve” Waivers that the Governor recommended.  Instead, the Conference Committee provides 355 I/DD Waivers above the DOJ agreement in FY17 for individuals and families on the I/DD Waiver waiting lists ($5.2M GF total).  200 of these Waivers are reserved for the first 200 people on the DD Waiver waiting list as of June 30,  2016. The total I/DD Waiver allocation will be as follows:
                              I/DD Waivers Included in the Budget Bill FY17 FY18 Total



Community Living (CL)Waivers for Waiting List









Individual and Family Support (IFS) Waivers for Waiting List









Community Living (CL) Waivers for Individuals Leaving Training Centers









Reserve Waivers for emergencies, transitions from other institutional settings  and movement between waivers







  • Limits the hours a single consumer-directed attendant works to no more than 40 hours per week per employer. This would affect individuals and families receiving consumer-directed respite, personal care and companion services.  Attendants would not be allowed to work more than 40 hours per week for an individual/family.


  • Moves forward with I/DD Waiver Redesign, but includes some amendments.  In total, provides $34M SGF to increase I/DD waiver reimbursement rates and implement new waiver services as part of the redesign: 
FY17 FY18
General Fund $11.8M $22.2M
Non-General Fund $11.8M $22.2M
Total $23.6 $44.4M


The Conference Committee report includes the following amendments for Waiver Redesign:


  • Accepts the rates and models proposed in the Burns study (available here), with the exception of the following:


  • The rate increase for   skilled nursing offered in I/DD Waiver will be 25%.


  • Private duty nursing  offered under I/DD Waiver, EPSDT  and Tech Waiver will receive a 11.5% increase (rate increase for private duty nursing in I/DD Waiver was originally 40%).


  • Provides a 24.5% Northern Virginia rate differential for Sponsored Residential services effective January 1, 2017.
  • Initiates the following services as of July 1, 2016:  Shared Living Residential, Supported Living Residential, Independent Living Residential, Community Engagement, Workplace Assistance Services, Private Duty Nursing Services, Crisis Support Services, Community Based Crisis Supports, Center-based Crisis Supports, and Electronic Based Home Supports;
  • Delays implementation of the following services until July 1, 2017:  Community Guide and Peer Support Services, Community Coaching, Benefits Planning, and Non-medical Transportation (for a description of all NEW services available in the redesigned I/DD Waiver, click here).


  • Requires DMAS and DBHDS, in collaboration with sponsored residential providers and family home providers, to collect information and feedback related to payments to family homes and the extent to which changes in rates have impacted payments to the family homes statewide.


  • Requires an independent review of the Commonwealth’s options for continued operation of Central Virginia Training Center in the event that sufficient community capacity is not available or is insufficient to meet the care needs of individuals.  (Note-the DOJ agreement requires the Commonwealth to ensure community-based care meets the needs of Training Center residents).


  • Requires that expenditures from the Behavioral Health and Developmental Services Trust Fund be appropriated through an appropriations bill passed by the General Assembly.  The budget also allows funds to be carried forward to the subsequent fiscal year and authorizes funding to build community capacity in FY16 and FY17.


  • Authorizes $750,000 in FY16 for one-time capital and transition cost associated with the development of community-based waiver group homes and/or community-based intermediate care facilities for individuals with intellectual disabilities who are transitioning to community living from Southwestern Virginia Training Center and who choose to remain in Southwest Virginia.  The housing options shall be located in Virginia no farther than 100 miles from the Southwestern Virginia Training Center.  The Department of Behavioral Health and Developmental Services shall give preference to projects involving existing Virginia Providers to expand service capacity.


  • Authorizes $4 million in FY17 for one-time expenses related to developing housing options and specialized services, and making capital improvements to enhance and expand services for individuals intellectual and developmental disabilities.  A minimum of 60 percent of the funding will be used to build community capacity in NOVA and the remaining funding will be used to build community capacity for individuals who are transitioning from the community from SWVTC.  Language specifies that projects addressing SWVTC are to be located in VA within 100 miles of the facility.  DBHDS is required to give preference to projects involving existing VA providers to expand capacity.  Language also requires the  agency to report on expenditures from the Trust Fund by 12/1/2016


  • Provides rental assistance programs for people with intellectual and developmental disabilities.   Provides funds for the 300 rental vouchers and provides ongoing funds for Rental Choice VA subsidy program
  • Provides DBHDS with 35 new staff positions.  Provides funds for 10 prior authorization specialists, 5 prior authorization team leads and one administrative assistant to support the prior authorization team for the new I/DD Waiver program.   15 additional positions are created to facilitate compliance with the DOJ.
  • Provides $9.6M to strengthen crisis programs for children and adults with I/DD.  Provides funds to build two, eight bed therapeutic homes, in additional to funds for mobile crisis services, respite services for children and crisis coordinators in each region.  Funds are included for three crisis specialists to work in state mental health facilities to reduce unnecessary institutionalization.  The Independent Reviewer charged with monitoring the state’s compliance with this agreement has noted that the state continues to be noncompliant in this area particularly as it applies to children.
  • Requires a review of CSA to increase integration of children with disabilities into their home school districts. Requires the CSA State Executive  Council to review and develop a robust set of options for (i) increasing the integration of children receiving special education private day treatment services into their home school districts, including mechanisms to involve local school districts in tracking, monitoring and obtaining outcome data to assist in making decisions on the appropriate utilization of these services and (ii) funding the educational costs with local school students whose placement in or admittance to state or privately operated psychiatric or residential treatment facilities for the non-educational reasons has been authorized by Medicaid.  The SEC shall continue its review with the assistance of relevant stakeholders including representatives of the ODE, DMAS the Office of Comprehensive Services, DBHDS, local school districts, local governments and public an private service providers.  The SEC shall present a robust set of options and recommendations that include possible changes to policies, procedures, regulations and statues, including any fiscal impact for consideration by the Governor and the chairmen of the House Appropriations and Senate Finance Committees by November 1, 2016.
  • Provides $375,000 from the general fund each year for the Long Term Employment Support Services (LTESS) program to support individuals with disabilities.
  • Requires DOE to convene an interagency workgroup to assess the barriers to serving students with disabilities in their local public schools.   The workgroup shall assess existing policies and funding formulas including school divisions’ program requirements, localities’ composite indices, local CSA match rate allocations, local CSA rate setting practices, the impact of caps on support positions, policies for transitioning students back to the public school, and funding for local educational programming based on models which are collaborative and create savings for both local and state government while providing youth an educational option within their communities. Membership shall include a balance of local and state representatives, all impacted state agencies, local education agency (LEA) representatives, local CSA representatives, local government officials, local special education administrators, stakeholder organizations, parent representatives, the Arc of Virginia, the Coalition for Students with Disabilities, and members of the Virginia General Assembly. The workgroup shall make recommendations to the Virginia Commission on Youth prior to the 2017 General Assembly Session.”


For a full summary of all I/DD related budget items, including a side-by-side comparison of Governor, House, Senate and Conference Committee budgets, Side by Side 2016 Budget Bill- Conference Committee Report FINAL


The House briefing on the Conference Committee report, which includes an overview of all major items in the budget bill, can be found here.

DBHDS Letter To Individuals and Families Re: I/DD Waiver Redesign

The Department of Behavioral Health and Developmental Services (DBHDS) is amending the three Medicaid Waivers (ID, DS, & DD) and the changes will be effective July 1, 2016. Today, DBHDS released the following letter and attachment outlining the proposed new services array.

Letter to Individuals and Families Re: I/DD Waiver Redesign

Proposed New Service Array

The Arc of Virginia continues to be involved in the I/DD Waiver Redesign effort.  We will be holding a training series this Spring and Summer. Stay tuned!

Court Hearing For Tuesday, January 12, CANCELED

The court hearing scheduled for Tuesday, January 12 has been canceled.  The U.S. Department of Justice and the Commonwealth of Virginia are currently negotiating specific implementation schedules, including time frames, interim steps, and performance indicators, for specific areas of the agreement.  The Honorable John Gibney, the federal judge presiding over implementation of the agreement, posted the following today:



 “Pending before this Court is the United States’ Statement of Issues and Motion for Court-Ordered Schedule, ECF No. 186 (“Motion for Schedule”). In that motion, the United States described its concerns about delays in the implementation of the Settlement Agreement, ECF No. 112, August 23, 2012 (“Agreement”), including delays in developing a functional crisis system, integrated day and supported employment programs, and integrated housing. Id. at 1-2. The United States’ concerns were amplified by delays in the Commonwealth of Virginia’s restructuring of its Home and Community-Based Services Waivers (“HCBS Waivers”). Although not required by the Agreement, this restructuring is a strategy presented by the Commonwealth to achieve compliance with many of the Agreement’s provisions. Defendant’s Response to the United States’ and Intervenors’ Statements of Issues and in Opposition to the United States’ Motion for Court-Ordered Schedule, ECF No. 191, at 3. Consequently, the United States requested in the motion that the Court require the Commonwealth to provide a schedule setting out reasonable time frames for implementation of the Agreement’s provisions, consistent with the Agreement’s underlying requirements. Motion for Schedule at 3, 29.

At a public status conference on October 23, 2015, addressing the implementation of the Agreement, the Court set a hearing for the Motion for Schedule but encouraged the United States and the Commonwealth to address the issues underlying the motion and determine whether further proceedings were necessary. Since the October hearing, the Commonwealth and the United States have held numerous discussions and have reached agreement on specific implementation schedules, including time frames, interim steps, and performance indicators, for four discrete areas of the Agreement that the United States highlighted in its Motion for Schedule: Supported Employment, Community Engagement (i.e., “Integrated Day”), Crisis Services for Adults, and Crisis Services for Children. The Commonwealth and the United States jointly submit these schedules as Attachment A hereto. The Parties hereto do not intend for these schedules to be modifications or addenda to the Agreement, or entered as court orders at this time. However, the Parties agree that, if implemented, these schedules should significantly facilitate implementation of the Agreement itself.

Moreover, the Parties have committed to continue to negotiate schedules for the remaining areas identified in the United States’ motion, including: integrated housing options, children in nursing facilities and large intermediate care facilities, individuals with complex medical needs, and quality and risk management. The Parties intend to submit similar implementation schedules for those areas during the next several months. In addition, since the October hearing, the Commonwealth has submitted a budget to the General Assembly that, if approved, should enable the Commonwealth to proceed with the restructuring of its HCBS Waivers to help continue efforts to implement the Agreement. In light of the foregoing, the United States submits that proceedings at this time on the United States’ pending Motion for Schedule are not necessary, and the United States herewith withdraws its Motion for Schedule without prejudice. However, the United States may renew its motion if anticipated progress fails to occur.”