Congress boosts Medicaid home care funding, requires states to raise worker pay
S. 2076 — HCBS Relief Act of 2025 · Filed by Ben Luján (D-NM) · 17 cosponsors · Introduced Jun 12, 2025 · Referred to committee
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What it does
This bill temporarily increases the federal government's share of Medicaid costs for home and community-based services (HCBS) by 10 percentage points for fiscal years 2026–2027, allowing states to expand services for elderly and disabled individuals. States must apply and commit to using the funds to raise worker pay, reduce waiting lists, and improve service quality; the federal government will evaluate outcomes and require states to report results by 2029.
Why we flagged it
The bill's core mechanism is a temporary federal cost-share increase (FMAP boost) for a specific Medicaid service category, paired with mandatory workforce investment and outcome reporting. It is straightforward expansion funding with accountability measures.
What the text implies
- The 10-point FMAP increase is capped at 95% federal share, meaning high-FMAP states (already at 85%+) receive the full benefit while lower-FMAP states may hit the ceiling early, creating unequal per-capita impact across states.
- Mandatory workforce compensation increases may be passed through to Medicaid beneficiaries via reduced service hours or narrower eligibility if states cannot absorb cost growth after 2027 when the FMAP boost expires.
The full analysis lists 5 implications of this text.
Who stands to gain
home health agencies; direct support professional employers; non-profit HCBS providers