Adds to existing law to direct the Department of Health and Welfare to conduct a study of options regarding certain Medicaid programs.

LEGISLATURE OF THE STATE OF IDAHO Sixty-eighth Legislature Second Regular Session - 2026 IN THE SENATE SENATE BILL NO. 1267 BY HEALTH AND WELFARE COMMITTEE AN ACT1 RELATING TO MEDICAID; AMENDING CHAPTER 2, TITLE 56, IDAHO CODE, BY THE AD-2 DITION OF A NEW SECTION 56-276, IDAHO CODE, TO ESTABLISH PROVISIONS RE-3 GARDING POLICY OPTIONS FOR MEDICAID FOR WORKERS WITH DISABILITIES AND4 HOME AND COMMUNITY-BASED SERVICES; AND DECLARING AN EMERGENCY.5

Be It Enacted by the Legislature of the State of Idaho:6

SECTION 1. That Chapter 2, Title 56, Idaho Code, be, and the same is7 hereby amended by the addition thereto of a NEW SECTION, to be known and des-8 ignated as Section 56-276, Idaho Code, and to read as follows:9 56-276. MEDICAID FOR WORKERS WITH DISABILITIES AND HOME AND COMMU-10 NITY-BASED SERVICES -- POLICY OPTIONS STUDY.11 (1)(a) The legislature finds that:12 (i) Idaho has a strong interest in encouraging work, self-suffi-13 ciency, and personal responsibility, including through policies14 that allow individuals with disabilities to work, earn income, and15 save for their future;16 (ii) Idaho's medicaid for workers with disabilities program17 is intended to incentivize work by allowing individuals with18 disabilities to maintain medicaid coverage while working and ac-19 cumulating assets;20 (iii) Many individuals who participate in medicaid programs21 worked for many years, contributed to their communities and the22 state economy, and saved modest assets to support stable and inde-23 pendent living;24 (iv) Some individuals who are enrolled in the medicaid for25 workers with disabilities program later experience age-related26 changes or progression of disability that limit or prevent contin-27 ued employment;28 (v) Upon transitioning from the medicaid for workers with dis-29 abilities program to other medicaid programs or home and commu-30 nity-based services waivers, such individuals may be required to31 give up assets earned through work, which can discourage employ-32 ment, undermine savings incentives, and increase the risk of un-33 necessary institutionalization;34 (vi) Medicaid home and community-based services waivers allow35 Idahoans with disabilities and older adults to receive long-term36 services and supports in their homes and communities rather than37 in institutional settings;38 (vii) Some home and community-based services waiver participants39 are required to pay a high share of cost, leaving limited income or40 resources to pay for basic nonmedical needs such as housing, util-41 ities, and transportation;42

2 (viii) When individuals cannot afford these basic living ex-1 penses, they may be forced into institutional settings even though2 they could safely remain in their homes with appropriate supports;3 and4 (ix) Institutional care is often more costly than home and com-5 munity-based services and may reduce independence and quality of6 life.7 (b) It is the intent of the legislature to direct the department of8 health and welfare to identify and evaluate options within existing9 federal medicaid authority that: prioritize continuity for individ-10 uals enrolled in or transitioning from the medicaid for workers with11 disabilities program, maintain incentives for work and saving, avoid12 penalizing individuals who worked and saved but later require services,13 and support continued community living in order to reduce the risk of14 unnecessary institutional placement.15 (2) The department of health and welfare is directed to:16 (a) Identify and evaluate policy options for individuals enrolled in17 or transitioning from the medicaid for workers with disabilities pro-18 gram due to age-related or disability-related limits on continued em-19 ployment and medicaid home and community-based services waiver partic-20 ipants who:21 (i) Have a high share of cost or similar financial participation22 requirement;23 (ii) Are unable to meet essential nonmedical living expenses24 needed for community living; and25 (iii) Would otherwise be at risk of placement in an institutional26 setting;27 (b) Examine options including but not limited to:28 (i) Options to modify, remove, or provide alternatives to age-re-29 lated eligibility limits in the medicaid for workers with disabil-30 ities program;31 (ii) Asset or resource protections allowed under federal medicaid32 law;33 (iii) Alternative methods in which income or resources may be con-34 sidered for affected individuals;35 (iv) Limited exclusions or allowances related to housing stabil-36 ity and community living;37 (v) Waiver amendments, demonstrations, or other federal authori-38 ties that support community living; and39 (vi) Approaches used by other states to preserve work incentives40 while reducing unnecessary institutionalization; and41 (c) Consider the fiscal impact, administrative feasibility, and poten-42 tial effects on individual independence, quality of life, and long-term43 medicaid costs of options identified and evaluated pursuant to this44 subsection.45 (3) In evaluating options related to the medicaid for workers with dis-46 abilities program pursuant to subsection (2) of this section, the department47 of health and welfare shall prioritize approaches that:48 (a) Preserve incentives to work and save;49 (b) Recognize assets earned through employment;50

3 (c) Support continuity of coverage and community living when work is no1 longer possible due to age or disability; and2 (d) Avoid unintentionally penalizing individuals for prior employment3 or savings.4 (4) In carrying out the provisions of this section, the department of5 health and welfare shall:6 (a) Consult and collaborate, to the extent practicable, with commu-7 nity-based organizations, including organizations representing work-8 ers with disabilities, centers for independent living, provider orga-9 nizations, consumer advocacy groups, and other entities that work di-10 rectly with individuals affected by medicaid for workers with disabili-11 ties or medicaid home and community-based services policies;12 (b) Seek input, to the extent practicable, from individuals enrolled13 in or transitioning from the medicaid for workers with disabilities14 program, individuals receiving home and community-based services, and15 families and caregivers of such individuals; and16 (c) Consider stakeholder and consumer input when evaluating options17 and developing recommendations.18 (5) No later than December 1, 2026, the department of health and wel-19 fare shall submit a written report to the health and welfare committees of20 the Idaho senate and the Idaho house of representatives that includes:21 (a) Options identified by the department, with specific findings re-22 lated to medicaid for workers with disabilities;23 (b) Any federal approvals that would be required;24 (c) Estimated fiscal impacts, including potential cost avoidance from25 reduced institutionalization;26 (d) Administrative considerations; and27 (e) Recommendations for legislative or administrative action.28

SECTION 2. An emergency existing therefor, which emergency is hereby29 declared to exist, this act shall be in full force and effect on and after its30 passage and approval.31