Home and Community Based Services (HCBS) American Rescue Plan Act (ARPA)

American Rescue Plan Act (ARPA)

On March 11, 2021, President Biden signed the American Rescue Plan Act (ARPA) into law, enacting a $1.9 trillion COVID-19 relief package. The legislation includes a number of provisions that impact state and federal health care policies and programs, including the availability of enhanced federal funding for state Medicaid spending on HCBS. These services help older adults, people with disabilities and people with behavioral health needs live independently in the community by providing a variety of supports.

In particular, Section 9817 of the American Rescue Plan provides states with a one-year, 10 percentage point increase in their federal medical assistance percentage (FMAP)—the share of state Medicaid spending paid for by the federal government—for certain Medicaid HCBS expenditures. This 10-percentage point increase will apply only to HCBS expenditures provided between April 1, 2021 and March 31, 2022.

States must use the federal funds attributable to the one-year increased FMAP by March 31, 2024 and funding must supplement, not supplant, existing state funds expended for Medicaid HCBS in effect as of April 1, 2021. In addition, states must use state funds equivalent to the amount of federal funds attributable to the increased FMAP to implement or supplement the implementation of one or more activities to enhance, expand, or strengthen HCBS under the Medicaid program.

In developing our plan, New Mexico Medical Assistance Division (MAD) drew on expertise within the division in addition to requesting input from HCBS provider organizations, advocacy groups, other HSD divisions, sister state agencies, and individuals. Our proposal reflects the recommendations that we received. We propose to use federal funds attributed to the increase FMAP to supplement, not supplant, existing state funds expended for Medicaid HCBS in effect as of April 1, 2021, in both fee-for-service and managed care.  Our commitment remains to strengthen our program through implementing activities that support the following four pillars:

  1. Investing in our Medicaid HCBS workforce
  2. Expanding our HCBS infrastructure
  3. Improving and expanding access to HCBS services through navigation systems
  4. Providing new and/or expanding existing HCBS services

You can review the presentation presented at the most recent stakeholder session here: ARPA HCBS Stakeholder Briefing

New Mexico’s initial spending plan proposal is available for review here: NM HCBS ARPA Spending Plan

Public Comment here: https://www.hca.nm.gov/public-information-and-communications/opportunity-for-public-comment/public-notices-proposed-waiver-changes-and-opportunities-to-comment/comment-period-open/

Centers for Medicare and Medicaid Services (CMS) Request for Additional Information (RAI) is available here: CMS RAI 9.27.21

New Mexico’s Response to the RAI is available here:


New Mexico’s Expedited Request Letter to CMS’ Partial Approval is available here: NM Partial Approval Expedited Request Letter 2.3.2022

New Mexico’s HCBS ARPA Spend Plan Q3FFY22 Submission is available here: NM HCBS Spending Plan Quarterly Update 2.15.2022

Centers for Medicare and Medicaid Services (CMS) Partial Approval is available here: CMS Partial Approval 11.5.2021

New Mexico’s Temporary Reimbursement Increase: Press Release and Frequently Asked Questions for 15% HCBS Provider Reimbursement Increase

New Mexico’s FY 2022 Q4 HCBS ARPA Spend Plan Submission is available here: NM FY 2022 Q4 HCBS Spending  Plan

New Mexico’s Q1 FY 2023 HCBS ARPA Spend Plan and Narrative Submission is available here: NM Q1 FY 2023 HCBS Spending Plan and Narrative

Quarterly HCBS ARPA Spending Plan (Quantitative) Reporting

Semi-Annual HCBS ARPA Spending Plan (Quantitative) and Narrative Reporting