HCBS Settings Rule: Compliance for Residential Service Providers

In 2014, the Centers for Medicare & Medicaid Services (CMS) published the HCBS settings rule. The federal requirements define the qualities of settings eligible for reimbursement for Medicaid home and community-based services. Under the requirements, DHS must ensure that settings in which home and community-based services are provided meet and remain in compliance with the settings rule requirements.

The Wisconsin Department of Health Services (DHS) is implementing a compliance review process based on statewide benchmarks. The process determines compliance of residential settings so that compliant providers can be assured they meet the requirements, and non-compliant providers have the opportunity to remediate any deficiencies. DHS began to enforce compliance on March 1, 2019, for adult residential settings.

Adult residential settings subject to the Home and Community-Based Settings (HCBS) rule:

  • Licensed community-based residential facilities
  • Licensed 3-4 bed adult family homes
  • Certified 1-2 bed adult family homes
  • Certified residential care apartment complexes

Ongoing compliance: Certified 1-2 bed adult family homes (AFH)

DHS requires managed care organizations, county human services agencies, and the IRIS (Include, Respect, I Self-Direct) program under contract with DHS to certify 1-2 bed AFHs. Federal HCBS settings rule requirements have been incorporated into the DHS Standards for 1-2 Bed Adult Family Homes, P-00638 (PDF). Certifying agencies are required to review compliance within the DHS standards for any setting that intends to serve HCBS waiver-funded residents. The Home and Community-Based Settings Adult Residential Provider Assessment, F-02117 (Word) is used to record observations while performing the required on-site certification or recertification visit.

Additional information on Wisconsin's 1-2 bed AFH compliance benchmarks and review process:

Ongoing compliance: DQA-regulated assisted living settings

Effective March 1, 2019, the Division of Quality Assurance (DQA), Bureau of Assisted Living (BAL), began inspecting DQA-regulated assisted living facilities to ensure compliance with the HCBS settings rule.

The DQA Implementation of Home and Community-Based Services Settings Rule in Residential Assisted Living Facilities, P-01826 (PDF) provides general information on how DQA will incorporate the HCBS regulations into the assisted living survey processes. This publication provides important information on the following:

  • Background
  • Implementation
  • Heightened scrutiny review process
  • Notice of HCBS compliance review determination
  • Training information
  • Resources

DHS will continue to evaluate the impact of the HCBS settings rule regulations on regulated assisted living settings and will make revisions as needed.

Contact information

If you cannot find the answer to your question, send us an email or call 877-498-9525.

The information provided on this page is published in accordance with 42 C.F.R. 441.301(c)(4).

Last Revised: December 27, 2019