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Balancing Incentive Program

The Balancing Incentive Program (BIP) provided financial incentives to States to increase access to non-institutional long term services and supports (LTSS) in keeping with the integration mandate of the Americans with Disabilities Act (ADA), as required by the Olmstead decision and was created by the Affordable Care Act of 2010 (Section 10202). The Balancing Incentive Program authorized grants to serve more people in home and community-based settings, from October 1, 2011 to September 30, 2015. Thirteen states continue to participate in the program by spending the grant funds to increase access to new or expanded services and infrastructure.

The Balancing Incentive Program helped States transform their long-term care systems by:

  • Establishing No Wrong Door Systems for people to obtain information on Medicaid LTSS
  • Utilizing core standardized assessment instruments to streamline access to LTSS
  • Implementing conflict-free case management by ensuring proper firewalls and mitigation strategies are in place to enable access to quality LTSS

The Balancing Incentive Program increased the Federal Matching Assistance Percentage (FMAP) to States that made structural reforms to increase nursing home diversions and access to non-institutional LTSS. The enhanced matching payments were tied to the percentage of a State’s LTSS spending, with lower FMAP increases going to states that needed to make fewer reforms. The BIP state must use the enhanced FMAP only to provide new or expanded home and community-based LTSS and related infrastructure.

Total funding over the 4 years (October 2011 – September 2015) was $2.4 billion in federal enhanced matching payments.

Federal Funding for State Programs

To participate in the BIP, a state must have spent less than 50% of total Medicaid medical assistance expenditures on non-institutionally based LTSS for fiscal year 2009. States must have also submitted an application that met programmatic and structural reform requirements:

  • States that spent 25-50% on non-institutionally-based LTSS were eligible for a 2% enhanced FMAP. These states must have reached 50% of total LTSS expenditures on non-institutionally based LTSS by September 30, 2015.
  • States that spent less than 25% on non-institutionally based LTSS were eligible for 5% enhanced FMAP. These states must reach 25% of total LTSS expenditures on non-institutionally based LTSS by September 30, 2015.

The following 21 states were approved: Arkansas, Connecticut, Georgia, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Mississippi, Missouri, Nebraska, Nevada, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, and Texas. Indiana, Louisiana, and Nebraska ended program participation as of January 1, 2014 prior to program completion.

The 13 states participating past the September 30, 2015 deadline are: Connecticut, Georgia, Illinois, Maine, Maryland, Massachusetts, Mississippi, Nevada, New Hampshire, New Jersey, New York, Pennsylvania, and Texas..

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