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In January 2014, the Centers for Medicare & Medicaid Services (CMS) issued a final rule as part of the federal health care law to ensure that Medicaid's home and community-based services (HCBS) programs provide full access to the benefits of community living and offer services in the most integrated settings.

Known as the home and community-based (HCB) settings rule, it was established to ensure that states receiving federal  Medicaid funds meet the needs of individuals who choose to receive their long-term services and supports in their home or community, rather than in institutional settings.  In describing the rule's intent, CMS says that individuals need full access to the benefits of community living and the opportunity to receive services in the most integrated setting appropriate. Its intent is to enhance the quality of HCBS and provide protections to participants.  Service planning must be developed though a person-centered process that addresses health and long-term services and support needs in a manner that reflects individual preferences and goals.

The final rule, which became effective March 17, 2014, requires states to submit a Statewide Transition Plan for compliance with the HCBS setting requirements. The Transition Plan outlines steps New Jersey will take to come into compliance.  CMS may approve Transition Plans for a period of up to five years for states' full compliance so that no individuals are left without services.

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