How policy decisions shape access, workforce stability, and the future of community based supports
When a family reaches out to Sycamore Services, they are usually focused on one thing: getting the right support, at the right time, for someone they love. What they do not see is the network of systems working quietly in the background to determine how quickly that support can begin, what services are available, and whether a provider has the resources needed to sustain quality care.
Behind every residential placement, employment support, or day program is a structure shaped by federal rules, state level decisions, and funding frameworks that evolve over time. These systems influence how services are designed, how staff are compensated, and how many people can be served at once. While these decisions are often made far from the day to day lives of the individuals who rely on services, their effects are felt in very real ways across communities.
Understanding how these systems function helps explain why access can expand in some years and tighten in others, why workforce investments have become a growing focus, and why providers like Sycamore Services must continually adapt to meet both community needs and regulatory expectations.
Federal policies shaping disability and community based services
Medicaid access expectations and workforce investment
In 2024, the Centers for Medicare and Medicaid Services finalized the Ensuring Access to Medicaid Services rule. One component that has received significant attention is the expectation that, over time, states generally ensure that at least 80 percent of Medicaid payments for certain home care services (including personal care, homemaker, and home health aide services) are spent on direct care worker compensation, with defined flexibilities and exceptions.
For providers, this signals a broader shift toward transparency and accountability in how reimbursement rates support the workforce. It also means that states are increasingly examining rate setting, pass through requirements, and reporting mechanisms as workforce shortages continue to challenge service capacity nationwide.
Community integration requirements under the HCBS Settings Rule
The federal Home and Community Based Services (HCBS) Settings Rule establishes standards to ensure that services funded through Medicaid support community inclusion, individual choice, and personal autonomy. With the formal transition period complete, states and providers are now expected to operate in full alignment with these requirements.
This affects how day services are structured, how employment supports are delivered, and how residential environments promote meaningful access to the broader community. Compliance is no longer a future goal but an ongoing operational expectation.
Federal oversight influences state planning
Even when no immediate statutory changes occur, federal oversight, audits, and rulemaking influence how states approach Medicaid expansion, rate increases, and waiver growth. In practice, uncertainty at the federal level often translates into cautious planning at the state level, shaping how quickly systems can respond to growing demand.
Indiana’s current landscape and its impact on services
Waiver restructuring and system transitions
On July 1, 2024, Indiana restructured its Aged and Disabled Waiver into two distinct programs:
Health and Wellness Waiver, generally serving individuals under age 60
PathWays Waiver, generally serving individuals age 60 and older
Transitions of this scale often bring changes in eligibility processes, care coordination, billing workflows, and provider compliance requirements. For organizations delivering services across multiple settings, adaptability becomes essential during and after such restructuring.
Waiver capacity limits and waiting lists
Indiana reached its federally approved waiver capacity in April 2024 and implemented a waiting list. The state publishes capacity data and monthly invitation counts to provide transparency around access.
As of December 2025:
6,174 individuals were on the Health and Wellness Waiver waiting list
10,405 individuals were on the PathWays Waiver waiting list
Waiting lists directly affect how quickly services can begin, how providers plan staffing and housing availability, and how families navigate transitions. Even when provider capacity exists, waiver availability ultimately determines access.
Direct care pass through requirements
Indiana also implemented a direct care compensation requirement tied to House Enrolled Act 1120. Under this policy:
At least 70 percent of reimbursement for Attendant Care must be used for direct service compensation
At least 60 percent of reimbursement for Structured Family Caregiving must be used for direct service compensation
This reflects a growing emphasis on ensuring Medicaid dollars directly support the workforce while increasing the importance of accurate cost reporting and audit readiness for providers.
How other states compare
A state reducing access barriers: Maryland
According to the Kaiser Family Foundation, Maryland experienced one of the largest reductions in HCBS waiting lists after increasing waiver slot capacity. The state reduced its home care waiting list by more than 2,000 individuals, demonstrating how targeted investment and slot expansion can directly improve access.
This example highlights how policy decisions that align funding with demand can stabilize provider networks and shorten the path to services for individuals and families.
A state facing sustained access strain: Texas
KFF reports that states which do not screen for eligibility on waiting or interest lists account for more than half of all individuals nationwide on such lists, approximately 325,000 people. Texas is identified as one of these states.
Texas maintains large interest lists for certain long term services and supports programs, and advocacy organizations frequently cite extended wait times and system strain.
Large, unscreened lists can make it more difficult to accurately measure need and create added uncertainty for providers attempting to plan services and staffing.
What this means for Sycamore Services and the communities we support
Several clear themes emerge from these trends:
Access is increasingly shaped by capacity, not by demand alone. Indiana’s published waiting list data shows that need continues to exceed available slots.
Workforce investment is becoming a structural expectation, reinforced by both federal guidance and state policy.
States that reduce waiting lists do so by expanding capacity, not by shifting eligibility rules alone. Maryland’s experience illustrates this clearly.
Long and uncertain waiting lists create planning challenges for providers, families, and communities alike.
At Sycamore Services, understanding these systems helps guide responsible growth, workforce sustainability, and long term planning. While the policies themselves may evolve, the focus remains constant: supporting individuals in living meaningful, connected lives within their communities.
References
Administration for Community Living. (2024, April 24). The Medicaid Access Rule: A Historic Regulation to Strengthen Home and Community Based Services.
Centers for Medicare and Medicaid Services. (2024, April 22). Ensuring Access to Medicaid Services Final Rule (CMS 2442 F) Fact Sheet.
Centers for Medicare and Medicaid Services. (n.d.). Home and Community Based Services Final Regulation (HCBS Settings Rule resources).
Administration for Community Living. (n.d.). HCBS Settings Rule.
Indiana Family and Social Services Administration (FSSA), Division of Disability and Rehabilitative Services. (n.d.). Medicaid HCBS overview and waiver structure.
Indiana FSSA, Division of Disability and Rehabilitative Services. (n.d.). HCBS Medicaid Waiver Waiting List Information.
Indiana Health Coverage Programs. (2025). Provider bulletin on direct care pass through requirements under HEA 1120.
Kaiser Family Foundation. (2025, November 20). A Look at Waiting Lists for Medicaid Home and Community Based Services from 2016 to 2025.
Texas Health and Human Services Commission. (n.d.). HCS and TxHmL interest list guidance.
The Arc of Texas. (n.d.). Medicaid waivers and waitlists in Texas.
Medicaid and CHIP Payment and Access Commission (MACPAC). (2025). Rate Setting for Medicaid Home and Community Based Services.
