Money Follows the Person Rebalancing Demonstration Program - Capacity Building | CMS 1LI 21 001

Opportunity Information: Apply for CMS 1LI 21 001

The Money Follows the Person (MFP) Rebalancing Demonstration Program - Capacity Building grant (Funding Opportunity Number CMS-1LI-21-001, CFDA 93.791) is a supplemental Medicaid-focused funding opportunity from the U.S. Department of Health and Human Services, Centers for Medicare and Medicaid Services (CMS). It was created in the context of COVID-19, after high infection and death rates in nursing facilities and other institutions increased urgency around shifting long-term services and supports (LTSS) away from institutional settings and toward home and community-based services (HCBS). CMS frames this shift as "LTSS rebalancing," meaning states work toward a more equitable balance of spending and service use between HCBS and institutional care, since historically a large share of LTSS has been delivered in institutions.

This supplemental funding is only available to state governments that are already MFP demonstration grantees and are currently operating MFP-funded transition programs. The underlying MFP demonstration, originally established by Congress through section 6071 of the Deficit Reduction Act of 2005, is intended to help Medicaid beneficiaries who live in institutions transition to community living, expanding choice for older adults and people with disabilities about where they live and receive services. CMS emphasizes that MFP is built around four core goals: increasing HCBS use while reducing institutional reliance; removing legal, plan, and budget barriers that restrict use of Medicaid funds for community-based LTSS; strengthening Medicaid program capacity to deliver HCBS for people transitioning out of institutions; and putting strong quality assurance procedures in place to improve HCBS.

The purpose of this specific capacity-building award is not simply to fund individual transitions, but to help states plan and build the infrastructure needed to accelerate LTSS system transformation and expand the capacity of HCBS statewide. CMS describes this as a way to sharpen state attention on rebalancing and to support meaningful, lasting progress, especially as states confront the institutional vulnerabilities highlighted by the pandemic. The funds can be used for costs necessary to implement approved planning and capacity-building activities, as long as they align with the objectives of the opportunity and comply with applicable grant rules and program requirements.

CMS provides a non-exhaustive list of the kinds of activities states may support with these supplemental dollars. Examples include assessing current HCBS capacity (such as whether there are enough providers, service types, or geographic coverage) and identifying gaps that require investment; assessing institutional capacity and determining where the state could safely reduce it; and developing strategies to reduce institutional bed capacity while ensuring impacted individuals can transition to more integrated community settings. The opportunity also supports stakeholder engagement in system planning and implementation, recognizing that rebalancing typically requires coordination across Medicaid agencies, providers, advocates, managed care entities, housing partners, and beneficiaries and families.

A major emphasis is also placed on workforce and provider capacity. Allowable activities include recruiting, educating, training, and providing technical assistance to HCBS providers and direct service workers, including training people with disabilities to become direct service workers themselves. Caregiver training and education is also explicitly included, reflecting the central role unpaid and family caregivers often play in successful community living. States may also evaluate and implement changes to reimbursement rates and payment methodologies in order to expand HCBS provider participation, strengthen service availability, and improve quality across HCBS and, where relevant, institutional services. Other eligible activities include provider quality improvement work; streamlining and improving HCBS eligibility and assessment processes to speed access and reduce administrative friction; building Medicaid-housing partnerships (often essential for successful transitions and avoiding reinstitutionalization); and implementing pre-admission diversion strategies to help people avoid unnecessary institutional placement in the first place.

From an application standpoint, CMS treats this as a supplemental budget request and sets specific content expectations. The request is expected to explain how the proposed HCBS capacity-building initiative supports MFP goals, provide milestones and timeframes for the work, describe how the initiative aligns with the state’s existing MFP sustainability planning, and outline how the state will engage stakeholders consistent with the stakeholder engagement approach identified in the state’s MFP operational protocol. CMS also notes that it will not create brand-new reporting systems for this opportunity, but it may make minor tweaks to existing reporting. In practice, states should expect to report the funded activities and milestones through the semi-annual reporting already required for MFP.

The funding mechanics are straightforward. States may request up to $5,000,000 (the award ceiling), and CMS anticipated up to 33 awards. Requests were accepted on a rolling basis through June 30, 2021. Funds are available for the federal fiscal year in which the award is made plus four additional fiscal years, giving states a multi-year runway to implement larger system changes that do not fit neatly into a single-year budget cycle.

The required submission package is fairly specific and centered on a short project narrative. CMS limits the project narrative to five pages total and recommends organizing it into four sections: a summary/abstract; goals, objectives, and outcomes (including concrete targets and explicit alignment with MFP sustainability planning); a proposed project description (including how funds build HCBS infrastructure and capacity, how the work supports LTSS transformation and strengthens cross-agency partnerships, what populations and geographic areas will be served, how the work builds on existing initiatives, and how it will be sustained after federal funding ends); and a project management section that clearly assigns roles and responsibilities across state staff and any consultants and includes a timeline with milestones. In addition to the narrative, applicants must provide a cover letter signed by the authorized organizational representative, submit an SF-424A budget (non-construction) through GrantSolutions, and complete the MFP Supplemental Budget Workbook (budget narrative tabs) for upload. CMS directed questions to mfpdemo@cms.hhs.gov.

• The Department of Health and Human Services, Centers for Medicare Medicaid Services in the health sector is offering a public funding opportunity titled "Money Follows the Person Rebalancing Demonstration Program - Capacity Building" and is now available to receive applicants.
• Interested and eligible applicants and submit their applications by referencing the CFDA number(s): 93.791.
• This funding opportunity was created on Jan 21, 2021.
• Applicants must submit their applications by Jun 30, 2021 No Explanation. (Agency may still review applications by suitable applicants for the remaining/unused allocated funding in 2026.)
• Each selected applicant is eligible to receive up to $5,000,000.00 in funding.
• The number of recipients for this funding is limited to 33 candidate(s).
• Eligible applicants include: State governments.

Apply for CMS 1LI 21 001

[Watch] Creating a grant proposal using the step-by-step wizard inside the applicant portal: