Introduction
Most Californians want to age in their homes and communities, rather than in institutional settings like nursing facilities. To remain living at home and active in their communities, many people need help with personal care and other assistance. Medicaid, not Medicare, is the main payer for these types of supports, known as Home and Community Based Services (HCBS). In California, Medi-Cal supports nearly a million older adults and people with disabilities living in the community through its HCBS programs.
The availability and extent of HCBS coverage, however, can be uncertain. This is because under federal law, states have the option to provide these services, but they are not required to do so. As a result, during budget shortfalls—whether caused by federal Medicaid funding cuts, a recession, or other financial challenges—states frequently consider reducing optional benefits like HCBS to balance their budgets.
This fact sheet provides an overview of HCBS in California, their vital role in supporting the health and well-being of older adults and disabled people, and makes the case for why California must commit to maintaining and expanding these vital supports even during fiscal downturns.
What are Home and Community-Based Services
Medicaid-covered HCBS are services that support older adults and people with disabilities with activities of daily living in settings of their choice, including their homes, assisted living facilities, and adult day health centers. Supports include, for example, personal care assistance, care coordination, medically-tailored nutrition, transportation, medication management, home modifications, and, for individuals with high care needs, 24-hour nursing and supervision. California’s HCBS programs include:
- Assisted Living Waiver provides care and supervision in licensed board and care settings such as Residential Care Facilities for the Elderly and at a limited number of public subsidized housing sites.
- Community-Based Adult Services Program provides social, therapeutic, nutrition, and personal care services at adult day health centers.
- California Community Transitions/Money Follows the Person assists residents in skilled nursing facilities transition to community housing by identifying, adapting, and setting up housing.
- Home and Community -Based Alternative Waiver provides personal care, 24-hour nursing, and other supports to people with complex needs.
- Home and Community-Based Services for the Developmentally Disabled coordinates and purchases support services for consumers with developmental disabilities through the Department of Developmental Services’ Regional Centers.
- In-Home Supportive Services (IHSS), a consumer-directed personal care program serving over 800,000 older adults and people with disabilities, provides assistance with activities of daily living like dressing, bathing, eating, and household chores.
- Medi-Cal Waiver Program provides case management and personal care services to individuals living with HIV/AIDS as an alternative to nursing facility care.
- Multipurpose Senior Services Program includes intensive care and service coordination, social supports, home repairs, and adult day programs for older adults age 65 and over.
- Program of All-Inclusive Care for the Elderly (PACE) provides coordinated health and home and community-based services to older adults at site-based PACE centers.
HCBS are a Lifeline
Medi-Cal’s array of HCBS programs help people remain in their homes and communities rather than having to receive care in an institutional setting, like a nursing facility. These programs enhance quality of life, promote dignity, and improve health outcomes. They also offer critical support to family caregivers through respite care and paid assistance, among other supports. Simply put, HCBS are a lifeline.
Daniel’s Story
After a medical crisis and extended hospitalization, Daniel, a Black older adult, was discharged to a skilled nursing facility to recuperate. Unable to climb the 36 stairs due to severe edema, he could not return home without support and spent two years in the facility. Thanks to the California Community Transitions program and the Home and Community-Based Alternatives Waiver, he secured an apartment where he now lives independently with daily caregiver assistance for physical therapy and a bi-weekly nurse visit. His condition has improved, allowing him to do the things he loves most—cooking, mentoring his nephews, and doing occasional freelance graphic design projects—from the comfort of his own home.
“Most people are not comfortable with someone else setting rules and dictating terms—it’s like a prison. You eat three meals a day at the same time, sleep at a certain time, get up at a certain time, there are specific activities available at certain times. It’s all restrictive. Being in skilled nursing was good for getting my health back but not for getting my life back. I needed to leave in order to be myself and live my best life.”
Ellie’s Story
When Ellie’s mother, Jane, was diagnosed with Alzheimer’s, Ellie tried to continue working while providing for her mom’s increasing care needs. When Jane was hospitalized, Ellie kept a suit with her in the hospital so she could attend work meetings and still stay with her mom overnight. But when Jane returned home from the hospital, Ellie was no longer able to balance a demanding job and full-time caregiving. She left her job so she could take care of her mom. But without her income, Ellie was unable to financially support both her family and her parents. She was grateful to become her mom’s, and later, her dad’s IHSS caregiver, and receive the financial support she needed to keep her parents cared for at home.
“Being able to keep my mom at home where things are familiar, and to be cared for by family and by people who speak your language was an incredible gift. IHSS let my parents be cared for by the people who know how to care for them best, in the comfort of their home and in their last stage in their lives when they deserved to be honored and cherished.”
The Consequences of Cutting Home and Community-Based Services: A Historical Perspective
History demonstrates that when states experience fiscal uncertainty, they often resort to cutting HCBS. Such was the case following the 2009 Great Recession when every state reduced HCBS spending either by cutting benefits or limiting eligibility. California was no exception, putting in place a 7% across-the-board cut to IHSS personal care hours, a reduction that was in place for over a decade before hours were permanently restored. California also attempted to fully eliminate the CBAS program, an effort that was overturned through litigation. Similarly, when California anticipated a budget shortfall at the start of the COVID-19 pandemic, the state proposed, but ultimately abandoned, eliminating the MSSP and CBAS programs and reinstating the 7% reduction in IHSS hours. Using state funds, California also provides health care coverage to undocumented immigrants, and similarly has turned to cutting HCBS for this population in budget downturns. In 2024, California proposed cutting IHSS for undocumented immigrants, which the state ultimately did not pursue. Most recently, in the 2025 May Revision, the Governor is proposing cutting all HCBS and long-term care in nursing facilities for undocumented immigrants.
The consequences of cutting HCBS are severe. People who do not receive adequate support are more likely to have difficulty leaving the house, shopping for groceries, and have a higher risk of experiencing medication errors. For those who need assistance, the loss of HCBS may leave them no choice but to move into a costly institution to receive care. Research shows, for example, that people 50 years and older who need, but do not receive HCBS are nearly five times more likely to have a nursing facility stay than people who have adequate support. Nationally this translates into 3.1 million more nursing home stays, increasing nursing home expenditures, which are four times more expensive than HCBS.
Cuts to HCBS expenditures will therefore increase costs to California. For example, nationally, a 15% cut in HCBS spending increases nursing facility spending by nearly $470 million, and a 45% cut increases nursing facility spending by $1.7 billion.
Cuts to HCBS also translate into more costs for family caregivers. Today, approximately 4.4 million Californians act as a caregiver for a family member. Nearly half (44.4%) experience significant financial strain, stemming from increased expenses, reduced work hours, or the need to leave their job to provide care, disproportionately impacting women of color. Additionally, one in seven caregivers reports experiencing physical or mental health challenges due to caregiving. Cuts to HCBS would worsen these issues, forcing family caregivers to take on even more responsibility and jeopardizing their economic security, health, and the well-being of those they care for.
Proposals that claim to save money by cutting HCBS will ultimately prove to be more expensive for the state, while inflicting significant harm on older adults, people with disabilities, and their families, who will lose access to essential services.
How Can California Protect and Strengthen Access to HCBS
California has made significant progress in expanding access to HCBS. Yet, many Californians who need HCBS are still unable to get them, and must go without care, move into nursing facilities, or rely on family caregivers to fill in the gaps. At the same time, the need for long-term care services is expected to increase as California’s population ages. California must explore sustainable strategies to protect HCBS during fiscal uncertainty while simultaneously expanding access to these vital services by:
- Increasing revenue for Medi-Cal to protect and expand access for California’s aging population and to fill gaps in coverage today.
- Expanding the number of people financially eligible for Medi-Cal who have no means of obtaining care, including reforming the Medi-Cal Share of Cost Program.
- Building an adequate statewide network of HCBS providers.
- Implementing policies to eliminate delays and waitlists for HCBS.
Conclusion
HCBS are essential for enabling older adults and people with disabilities to live with dignity in their own homes and communities. Policymakers must prioritize strategies to increase revenue, and safeguard the progress California has made in expanding HCBS availability, while also implementing policies that further enhance and improve access to these critical supports.
