The groundwork for the HCB Waiver and its impact was laid in the late 1970s and early 1980s.
There was interest in the comparative expense of community-based services to Medicaid beneficiaries compared to institutional care.
A series of demonstrations helped generate interest among policymakers in using home-and community-based services instead of nursing care.
A second change to the funding rules made support for the children in their home far more available.
In 1982, Social Security Act Amendments [Section 143 of the Tax Equity and Fiscal Responsibility Act (TEFRA), (P.L. 97-248)] permitted States to use Medicaid funds for certain children with disabilities who were 18 years of age or younger, living at home, and who would be eligible for SSI if they were institutionalized.
Tom Nerney describes a number of efforts to reform legislation and put an end to shameful conditions in institutions during the 1980s.
This type of waiver is frequently referred to as "Katie Beckett Waiver" or TEFRA. Katie's mother fought for support so Katie could stay at home.
The Waiver allowed states to make Medicaid benefits available to certain children with developmental disabilities who would not ordinarily be eligible for Supplemental Security Income (SSI) benefits because of their parent's income or resources. Services could be provided at the same level a child would receive had she been institutionalized.
In 1977, there were approximately 9,300 residential settings for 15 or fewer people with developmental disabilities. Three quarters of them were for six or fewer people. Almost all of the facilities (98.5%) were operated by non-state agencies.
Over the next ten years, the number of residential settings for 15 or fewer people almost tripled to 31,820 settings. Again, 98% of them were operated by non-state agencies.