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Funding Shifts

Senators David Durenberger and John Chafee
Photo courtesy Arc MN

Senators David Durenberger
and John Chafee

The balance of funding tipped. In 1977, 85% of the expenditures in residential services for people with developmental disabilities went to institutions.

By 1984, that figure dropped to 60%, and by 1988, most of the funds were going to community settings. The rise of smaller community settings and significant increase in the amount of support available to families resulted from two pieces of legislation.

In 1981, The Omnibus Reconciliation Act (P.L. 97-35) created the Home and Community Based (HCB) Waiver. Senator John Chafee, a Rhode Island Republican, spearheaded an effort that would allow Medicaid funds to be used for alternative community based responses on a large and broader scale.

Federal funds were available to support people to stay in their own homes, some with their families.

Support was available for foster homes (adult and child) and group homes which were not certified as ICFs/MR. Medicaid guidelines were issued for ICFs/MR facilities serving between 4 and 15 people.

The services eligible for funding, if a state chose to participate, included:

  • Case Management
  • Respite
  • Adult Day Care
  • Supported Living Arrangements
  • Habilitation
  • Chores
  • Supported Employment
  • Transportation
  • Homemaker
  • Personal Assistance