Report Highlights Necessity of Disability Services, Impact of Potential Cuts

WASHINGTON—United Cerebral Palsy (UCP) and ANCOR, two national voices for providers of long-term support services for people with intellectual and developmental disabilities (IDD), released the inaugural Case for Inclusion Policy Blueprint for Sustainable Services. The report builds on findings in the latest Case for Inclusion Data Snapshot released in October 2024 and details critical recommendations for policymakers to strengthen community-based services for people with IDD.

As Congress contemplates a spending cut of at least $880 billion that would undoubtedly target the federal Medicaid program, the Case for Inclusion Policy Blueprint also spotlights how home- and community-based services (HCBS) bolster local economies both through job creation and by enabling the family members of people with IDD to maintain employment.

In New York, for example, the positive economic impact of investing in HCBS was more than double the cost—$6.7 billion invested by the state into the disability services system led to $14.3 billion in economic activity. Other states prove that the opposite is also true. Maine, for instance, is estimated to be losing more than $1 billion per year in economic activity due to the national shortage of direct support professionals (DSPs) and the resulting need for family members of people with IDD to leave the workforce in order to care for their loved ones. Without DSPs to provide support for people with IDD, families also face mounting out-of-pocket expenses and are more likely to rely on public assistance.

Moreover, funding and delivering HCBS is far less costly in the long run. As of 2020, the average annual cost to serve a person with IDD in the community was $49,764, whereas the average cost to deliver those same services in a large, state-run institution was $313,188.

In October 2024, the Case for Inclusion Data Snapshot revealed that while community-based providers were able to increase hourly wage averages for DSPs to an average of $15.79 in 2022 (compared to $14.41 the year prior), the national average turnover ratio remains high at roughly 40%. Additionally, 90% of providers have experienced moderate to severe staffing challenges in the past year, and 39% have discontinued programs and services due to staffing shortages, indicating that the modest increases were not sufficient to attract and retain workers.

Long-term underinvestment in community-based services paired with insufficient Medicaid reimbursement rates continue to threaten disability service providers’ ability to raise wages to competitive levels. Without a mechanism to compel states to engage in regular reimbursement rate reviews and increases, providers will continue to struggle to offer wages competitive with employers in other hourly wage industries like fast-food restaurants or retail and convenience stores. As providers grapple with discontinuing existing services and turning away new referrals, individuals with IDD in 2023 spent 50 months on average—more than four years—languishing on states’ waiting lists to receive services.

ANCOR and UCP argue in the newly issued Policy Blueprint that cutting Medicaid would place insurmountable strain on state budgets, forcing them to either cover the gap created by a loss in federal funding or, more likely, cut optional programs and reduce services and hours allocated to people with IDD.

“The lives of people with intellectual and developmental disabilities will be deeply and tragically impacted if we fail to sufficiently invest in home- and community-based services and further cut federal Medicaid spending,” said Barbara Merrill, ANCOR’s chief executive officer. “Investing in the direct support workforce, and in providing care in peoples’ homes and communities, is more cost-effective in the long run, but right now, community providers are so squeezed that the majority cannot accept more referrals. Our national waiting list for services has hovered around half a million for years. Scaling back funding for services now, amid an ongoing workforce crisis, will lead to the shuttering of more services and even further limits on access to support for hundreds of thousands of people and their families that deserve to be active, included and productive members of their communities.”

“Policy change is what we need to impact meaningful change for people with disabilities,” said Armando Contreras, president & CEO for UCP. “Congress has the opportunity to reject proposed cuts to Medicaid, stabilize the direct support workforce, and improve access to services for people with disabilities. We urge them and decision makers across all levels of government to enact policies that prioritize dignity, independence and full inclusion of Americans with cerebral palsy and an array of other disabilities.”  

The Case for Inclusion 2025 Policy Blueprint offers policy recommendations for state governments, the Trump administration and the 119th Congress, including recommendations to:

• Establish a Standard Occupational Classification (SOC) for direct support professionals to help all levels of government identify employment trends to design appropriate policies to address the direct support workforce crisis.
• Increase federal and state funding for the Medicaid-funded Home and Community Based Services program, giving providers and advocates the opportunity to seek out critical funding opportunities to expand community-based services. 
• Implement systems of access monitoring to ensure Medicaid reimbursement rates keep pace with service delivery costs.

The inaugural Policy Blueprint is part of the broader Case for Inclusion family of data and advocacy resources. The Case for Inclusion Policy Blueprints are designed to provide concrete, actionable recommendations for policymakers at all levels of government in both Washington, D.C., and in statehouses around the country. Learn more at caseforinclusion.org.