How Colorado’s Medicaid ALR Providers Can Grow Under the OBBB
The passage of the One Big Beautiful Bill (OBBB) in 2025 marks a major shift in Medicaid policy across the United States—and Colorado’s assisted living community will feel the impact firsthand. As with any other change in policy, there will be opportunities for those who prepare.
HCBS-compliant ALRs—particularly those with streamlined operations and strong compliance systems—are positioned to grow as Colorado leans further into community-based long-term care models. The question is: how do you turn regulatory disruption into business development?
Colorado’s Use of HCBS Waivers
Colorado has consistently prioritized Home and Community-Based Services (HCBS) over institutional long-term care. Through Medicaid waivers such as the EBD (Elderly, Blind, and Disabled) and CMHS (Community Mental Health Supports) programs, the state provides funding for personal care, homemaker services, medication reminders, transportation, and more in assisted living residences that meet HCBS setting requirements.
In FY 2023–2024, over 75% of Colorado’s Medicaid long-term care funding supported community-based services rather than institutional care. This direction aligns with federal CMS priorities and has been reinforced by Colorado’s aggressive compliance push with the HCBS Settings Rule. For providers, this means that investing in HCBS-aligned services and facility models is not just a regulatory requirement—it’s a strategic growth path backed by long-term funding trends.
What You Can Do to Position for Growth
1. Ensure HCBS Certification and Waiver Eligibility
To access Medicaid reimbursement for personal care services, medication support, and non-skilled supervision, your facility must be approved to deliver services under the EBD or CMHS waiver. Legal counsel can guide you through the application process and help structure policies to meet the federal HCBS Settings Rule—especially around privacy, autonomy, and integration.
2. Update Resident Agreements and Disclosures
Changes in retroactive coverage rules and cost-sharing responsibilities make it essential that your resident contracts clearly address financial obligations, Medicaid status, and service limits. Work with your attorney to draft language that is both compliant and protective, especially when it comes to non-payment, Medicaid pending statuses, and service terminations.
3. Build Eligibility Tracking and Intake Policies
With Medicaid redeterminations moving to every six months, the risk of unintentional disenrollment rises sharply. Facilities should implement internal procedures to verify Medicaid status regularly, coordinate with case managers, and assist residents with renewals. Your legal team can help ensure these procedures comply with HIPAA, fair housing laws, and Colorado Medicaid regulations.
4. Evaluate Expansion into Additional Sites
Smaller, Medicaid-eligible residential ALRs are the growth model Colorado Medicaid is looking to fund. If your current facility is operating smoothly, now may be the time to consider duplicating your model in a second location. Legal advisors can help you assess zoning, licensure, HCBS site requirements, and corporate structuring for multi-site operations.
5. Review Vendor and Partner Agreements
As services like transportation, pharmacy, and care coordination become bundled into compliance-focused platforms, make sure your vendor contracts reflect updated Medicaid responsibilities. A legal review of your third-party relationships can protect your facility from liability and ensure that all services meet Medicaid billing and documentation requirements.
The information provided above is intended for educational purposes and serves as a general guide. It is not tailored legal advice for specific circumstances. For detailed guidance on this or other topics, please consult with a qualified legal professional or reach out to our firm.
We welcome your feedback and topic suggestions! If there's a particular issue related to residential assisted living or group housing that you'd like to see addressed, please feel free to email me at Brian@Pinkowskilaw.com.