Medicaid Waiver Program (2026 Guide): How It Works, Eligibility, and Provider Enrollment

What Is the Medicaid Waiver Program?

The Medicaid Waiver Program is a federally approved initiative that allows states to design and operate customized healthcare and support programs for people who need long-term services but prefer to live at home or in the community instead of institutional settings.

The program “waives” certain federal Medicaid requirements—such as uniform service delivery or statewide coverage—so states can target specific populations and offer additional benefits that traditional Medicaid does not cover.

Each state’s Medicaid waiver program operates independently, but all must meet federal CMS guidelines for approval and renewal.

Purpose of Medicaid Waiver Programs

• Promote independence and dignity — Allowing individuals to remain in their homes and communities.
• Reduce institutionalization — Shifting care away from nursing homes and hospitals.
• Encourage person-centered care — Tailoring services to individual needs and goals.
• Improve cost efficiency — Community-based care is typically less expensive than institutional care.
• Enhance quality of life — Supporting inclusion in education, employment, and community life.

Types of Medicaid Waiver Programs

1. Section 1915(c) – Home and Community-Based Services (HCBS) Waiver

The most common waiver type, allowing states to provide long-term care in home or community settings instead of nursing facilities.

Services may include:

• Personal care and homemaker services
• Adult day health programs
• Respite care for caregivers
• Home modifications and assistive technology
• Meal delivery and transportation
• Employment support and case management

Each state can operate multiple 1915(c) waivers designed for different populations, such as individuals with developmental disabilities, seniors, or children with medical complexities.

2. Section 1115 – Research and Demonstration Waivers

These waivers give states flexibility to test innovative healthcare models and expand Medicaid eligibility or benefits.

Examples include:

• Managed care demonstration programs
• Medicaid expansion for low-income adults
• Integration of behavioral health and physical health services

1115 waivers must be budget neutral, meaning they cannot increase overall federal Medicaid spending.

3. Section 1915(b) – Managed Care Waivers

Allows states to require Medicaid participants to enroll in Managed Care Organizations (MCOs) that coordinate services.

This helps streamline care and reduce administrative costs.

4. Combined 1915(b)/(c) Waivers

Some states combine both types to deliver home and community-based services through managed care networks.

This structure is often referred to as Managed Long-Term Services and Supports (MLTSS).

5. Section 1135 – Emergency Waivers

Used during national emergencies or public health crises to temporarily waive certain Medicaid or Medicare requirements.

How the Medicaid Waiver Program Works

1. State Proposal: A state Medicaid agency develops a waiver proposal and submits it to CMS for approval.
2. Federal Review: CMS ensures the waiver meets cost, quality, and oversight requirements.
3. Implementation: Once approved, the state can enroll participants and begin delivering services.
4. Monitoring: The state and CMS evaluate outcomes, spending, and compliance regularly.
5. Renewal: Waivers are typically approved for 3–5 years and must be renewed periodically.

Eligibility for Medicaid Waiver Programs

Eligibility requirements vary by state, but participants must generally:

• Be eligible for Medicaid based on income and resource limits.
• Require an institutional level of care (such as nursing home or hospital-level services).
• Choose to receive care in a home or community setting instead of an institution.

Common Populations Served

• Seniors aged 65 and older
• Individuals with intellectual or developmental disabilities (IDD)
• People with physical disabilities or mobility impairments
• Individuals with brain or spinal cord injuries
• Children with complex medical needs
• Adults with behavioral or mental health conditions

Services Covered Under Medicaid Waiver Programs

Waiver services are designed to promote independence and reduce institutional dependence. Examples include:

Medicaid Waiver Programs by State (Examples)

How Providers Can Become Medicaid Waiver Service Providers

Home care agencies, nursing providers, and community-based organizations can apply to become Medicaid waiver service providers through their state’s Medicaid agency.

Step-by-Step Process

1. Research Your State’s Waiver Programs
   Identify the types of services offered and the populations served. Each state’s Medicaid website lists available waivers.
2. Meet Licensing Requirements
   Obtain the appropriate business or healthcare license (e.g., home care license, group home certification). For documentation support, see the Non-Medical Home Care Agency Policy and Procedure Manual (Any State) and the Home Health Agency Policy and Procedure Manual (Any State).
3. Enroll as a Medicaid Provider
   Apply through your state Medicaid portal or through PECOS (if applicable).
   Submit ownership details, NPI, Tax ID, and background checks.
4. Complete Required Training
   Many states require person-centered planning and EVV (Electronic Visit Verification) training. Agencies can standardize staff onboarding with a Home Care Employee Handbook (Any Agency, Any State/Federal).
5. Sign Provider Agreements
   Agree to comply with Medicaid billing rules, audits, and participant rights regulations.
6. Start Delivering Services and Billing Medicaid
   Once approved, agencies can provide care and bill Medicaid or Managed Care Organizations (MCOs) for reimbursement.

Funding and Reimbursement

Medicaid waiver programs are funded jointly by:

• Federal Government (CMS): Covers 50%–83% of program costs through the Federal Medical Assistance Percentage (FMAP).
• State Governments: Fund the remaining portion and oversee local administration.

Providers submit claims electronically through state Medicaid billing systems or contracted MCO portals using approved billing codes.

Planning revenue and costs? A Home Care Business Plan (Any Agency, Any State) can help you model payer mix and staffing for waiver services.

Compliance and Oversight

Providers participating in waiver programs must comply with:

• HIPAA and EVV mandates
• State licensing and training requirements
• Quality assurance and incident reporting standards
• Regular audits and inspections

Failure to comply can result in penalties, repayment of funds, or removal from the provider network.

Operational checklists and templates are available in the Home Care Agency Operational Form Pack (Any US State/Federal) and in the List of All Forms (Any Agency Type).

Benefits of Medicaid Waiver Programs

For Participants

• Access to care in familiar home environments
• Greater independence and flexibility
• Support from family or chosen caregivers
• Enhanced community participation

For Providers

• Steady reimbursement through Medicaid funding
• Long-term service opportunities
• Increased demand for home and community care in 2026 and beyond

Frequently Asked Questions (FAQ)

1. What’s the difference between Medicaid and Medicaid waivers?

Medicaid is a federal-state insurance program that covers basic healthcare services, while Medicaid waivers expand coverage to include long-term home and community-based services not available under standard Medicaid.

2. How do individuals apply for waiver services?

Applicants must contact their state Medicaid office or local waiver coordinator, complete an assessment, and may be placed on a waiting list if capacity is limited.

3. Can family members get paid under Medicaid waivers?

Yes, in many states, family members can be approved as paid caregivers under self-directed or consumer-directed waiver programs.

4. Are there waiting lists for Medicaid waiver programs?

Yes. Many states have waiting lists due to high demand, especially for developmental disability and senior care waivers.

5. How often must providers renew their Medicaid waiver certification?

Providers typically renew every 3–5 years or as required by their state’s Medicaid agency, including background checks and compliance audits.

6. Is Electronic Visit Verification (EVV) required for waiver services?

Yes. Under federal law, all Medicaid-funded home and community-based services must use EVV systems for time and attendance tracking.

For client-facing materials, consider a Home Care Agency Client Handbook (Any State) or a Home Health Agency Client Handbook (Any State).

Final Thoughts

The Medicaid Waiver Program is one of the most important tools for expanding access to long-term care and community-based services in the United States. It empowers individuals to live with dignity and independence while giving providers the opportunity to deliver meaningful, personalized care.

For agencies, understanding and complying with waiver program requirements ensures timely reimbursement and long-term stability. For families, it means access to care that truly supports independence and quality of life.

To find waiver programs in your state, visit Medicaid.gov and search for the State Waiver Directory. You’ll find detailed descriptions of each waiver, eligibility rules, and provider enrollment instructions for 2026.