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Factors to Consider When Choosing Coverage Options: Two Illustrative Services 95Coverage of Assisted Living through the Personal Care Option: Arkansas 13Arkansas does not currently have a licensing category called “assisted living.” The state licenses ResidentialCare Facilities (RCFs), a board and care setting available to both private-pay individuals and Medicaid beneficiaries.Since the mid-1980s, Arkansas has provided Medicaid personal care services to residents of RCFs. 14 TheArkansas Medicaid program uses personal care rather than waiver funding for assisted living coverage becausethe RCF licensing category does not permit a nursing home level of services. The state is currently developinga more comprehensive assisted living program that will serve a more disabled population and be funded througha Medicaid waiver program.Target Population. Adults age 18 and over are served. Residents must be independently mobile (i.e., physicallyand mentally capable of vacating the facility within three minutes). Residents who can use canes, wheelchairs,or walkers are considered independently mobile if they do not need more than verbal or limited physical assistanceto vacate. Residents must be able to self-administer medications. They may not need more than intermittentnursing, have feeding or intravenous tubes, or be totally incontinent. Residents also may not have mentalincapacity (mental illness, dementia, substance abuse, etc.) that requires a higher level of treatment or care thanthe facility is capable of providing. 15Setting. RCFs provide single or double rooms without kitchen facilities. Resident access to a kitchen is notrequired because meals are provided. Bathrooms may be shared. There must be at least one lavatory for every6 residents and one tub/shower for every 10 residents.Services. RCFs provide personal care (assistance with bathing, grooming, and dressing), supportive services(guidance, direction, or monitoring), activities and socialization, meals, housekeeping, and laundry. Residentsmay choose the RCF or an outside agency to provide personal care services, thus ensuring the Medicaid beneficiary’sright of provider choice. Home health agencies are used to provide nursing services.Payment. Medicaid payment for personal care services is based on the number of service hours provided (feefor-service).The state limits the number of hours per month to 64, but the limit can be overridden with priorapproval. Room and board is paid with SSI benefits ($512 minus a personal needs allowance).costs for states concerned about utilization of anew benefit. The combination of nursing facilitylevel-of-care eligibility criteria, a set number ofslots (as is permitted in a waiver program), andexpenditure caps will limit the number of peoplepotentially eligible.The personal care option is advantageous in that itwill broaden eligibility by allowing a less severelyimpaired population to be served. This is becausestates may impose reasonable medical necessitycriteria but may not restrict the benefit to personswho require a nursing home level of care. One disadvantageof using the personal care option is thatit lacks the higher income eligibility standardused for waiver programs. When deciding whichapproach to use—or whether to use both—statesmay want to estimate how many people would beserved under the different options in order tojudge both the reach of the potential service andits likely cost.Type of WaiverWhen using the waiver program approach,should states add assisted living as a new serviceto an existing waiver program or implement itunder a separate waiver program? From one perspective,adding to an existing waiver program issimple and minimizes reporting and trackingrequirements. However, advocates for home andcommunity services may perceive the addition ofassisted living to the list of waiver servicesalready covered as increased competition for alimited number of slots available for home servicesmore generally. Coverage under a separatewaiver program may be a better approach, notonly for this reason but also because it enables astate to test the demand for and cost-effectivenessof assisted living per se. Separate waiver programsdesigned by a state to expand the totalnumber of people served under waiver programsmay also make it easier to reassure facilities inthat state that they will have access to a sufficientnumber of consumers. Since providers receive