Alaska raises Medicaid waiver and state plan service payment rates 3.2%

Alaska home-care providers see a 3.2% rate increase starting today, as the state's Division of Senior and Disabilities Services raised payment rates for home and community-based waiver and state plan services effective July 1, the first day of state fiscal year 2027.

The adjustment affects seniors and Alaskans with disabilities who rely on home and community-based care, and the home-care workforce whose wages are often tied to Medicaid reimbursement levels. The timing also coincides with a new federal transparency requirement: starting this month, states must publicly report hourly payment rates for personal care, homemaker, home health aide, and habilitation services on their websites under the Biden administration's 2024 Medicaid Access rule. That rule also sets a 2030 deadline requiring states to ensure at least 80% of Medicaid payments for designated home-care services go directly to direct care worker compensation.

The Disability and Aging Collaborative and the Consortium for Constituents with Disabilities warn that proposed federal Medicaid cuts could undermine state-level rate increases and threaten coverage and access for older adults and people with disabilities.

The increase covers long-term services and supports and targeted case management, personal care services, community first choice and chore services, and waiver services. Providers do not need to file separate requests. The division has loaded the new rates into the Medicaid Management and Information System, so claims for services delivered on or after July 1 will be processed at the higher amounts automatically.

The Alaska Department of Health put the combined federal and state cost of the personal care services adjustment at roughly $676,000 for SFY2027, comprising $360,118 in federal funds and $315,830 in state funds. The long-term services and supports targeted case management piece carries an estimated combined cost of about $144,000, comprising $93,718 in federal funds and $50,119 in state funds. Updated rate charts will be posted to the SDS webpage.

The Department of Health is also seeking federal approval for a Medicaid State Plan Amendment with a July 1 effective date to formalize the changes with the Centers for Medicare and Medicaid Services. A public comment period on the 2026 annual rate update runs until 5 p.m. on Thursday, July 30. Questions and comments can be directed to [email protected].