Unbundling of Residential Services

Kansas is exploring residential service unbundling to give HCBS IDD participants more choice and clarity in how they receive support in a residential environment. This effort builds on our broader commitment to person-centered planning, community integration, and compliance with the federal HCBS Settings Rule.

This work is in the early planning stage. While no implementation date has been set, Kansas has partnered with PCG to conduct a residential rate study to inform potential unbundling strategies. The findings from this study will guide how services may be defined, structured, and reimbursed in the future.

What Does This Mean for Providers and Participants?

Currently, residential services such as shared living, group homes, children’s residential home, or individualized supported living are reimbursed the same regardless of the way in which the service is delivered. Unbundling would introduce distinct service types that clarify what supports are provided, when, and by whom.

For participants, distinct services will provide greater clarity on the specific residential services they are able to choose from to meet their unique needs. For providers, it creates clearer expectations and allows organizations to tailor service delivery around their strengths while ensuring individuals have access to the right mix of supports.

Why Is Kansas Making This Change?

This initiative supports greater transparency, promotes individualized supports, and prepares Kansas to meet federal requirements around person-centered planning and Settings Rule compliance. As with day service unbundling, residential unbundling is an effort to help Kansas modernize its waiver structure to better align with how people live and receive support.

Timeline and Proposed Services

The earliest likely implementation would be during a future IDD waiver renewal, potentially in 2029. Stakeholder engagement, technical assistance, and provider transition planning will be essential parts of the process.

KDADS will provide regular updates as this work progresses, including opportunities for public input. No provider will be required to offer all services, and high-quality residential programs already in place will be supported to continue, adapt, and thrive under any new structure.

How are the residential services being restructured?

Currently, residential services are billed to one service code with a tiered rate based on the individual’s level of support assessment. This means that residential services provided in a group home setting, children’s residential home, independent living, and residential services provided in a shared living setting currently receive the same rate, despite having major differences in service delivery. KDADS is restructuring the rate to pay for residential services based on the setting in which they are provided. PCG’s rate study will assess what it costs to provide services in these varied settings and recommend a standardized rate for each setting type. This will ensure providers are paid adequately.

What are the residential service categories?

Adult Residential

Individualized Supported Living (ISL) services support individuals who live in their own residence with four or fewer individuals. Individuals receiving ISL supports may choose with whom and where they live and participate in the community at their own discretion. ISL services allow individuals to have intermittent supports from a residential service provider without living in a provider-owned setting. Residential service providers establish a cadence in which they provide in-person support to individuals in their residence based on the individual’s Person-Centered Service Plan. In-person support activities may include administering medication, checking to confirm if a participant has taken their medication, assisting with money management, socialization skills/relationship skills, community outings, transportation training, meal planning or preparation, deep cleaning assistance, or scheduling.
Group Home is a residential facility licensed by the state serving eight or fewer residents with intellectual and/or developmental disabilities. Group homes are similar in appearance to single-family dwellings and provide person-centered supports such as basic health supervision, habilitation training in daily and independent living skills, community integration, and social support.
Shared Living is where two or less participants with intellectual and/or developmental disabilities share a home with a family or single adult's family (the Shared Living Contractor). The Shared Living Contractor lives with the participant and supports them according to the participant’s person-centered service plan. A residential service provider trains and provides ongoing support for the Shared Living Contractor.

Children's Residential

Supportive Family Living (Children’s IDD Residential) is habilitation provided in a single residential setting licensed by the state, in which services and supports are provided to children with intellectual and developmental disabilities on the IDD waiver. Supportive Family Living settings serve no more than three children unrelated to the waiver participant, unless an exception has been granted.

Why is the payment process for residential servs changing?

Will the new rate structure for each residential service setting have tiers to account for an individual’s level of support needs?

The current methodology for determining the tier of a participant’s support needs is based on the participant’s BASIS score. KDADS will transition to using the MFEI as the new level of care tool in Summer 2025, and the BASIS will no longer be used. A new tiering methodology independent of the BASIS must be set to create a tiered rate. PCG’s rate study will provide the building blocks for residential services rates (personnel costs, overhead costs, etc.) that KDADS may use to adapt a tiered rate later.

Who will be impacted by the restructuring?

When will the new payment structure and billing process be implemented?

PCG will provide rate recommendations to KDADS for consideration by October 2025. KDADS has yet to determine when restructured rates will go into effect for the IDD waiver. Before implementation occurs, KDADS seeks to conduct further stakeholder engagement to ensure providers understand how their billing processes will change under the restructured rates. KDADS welcomes provider feedback on an implementation date. The earliest possible implementation date would be Summer 2026. Updating the current IDD rates to this new payment structure will require an amendment to KDADS’ IDD waiver, which will need CMS approval.

Where and when can I ask more questions about this?

Department for Aging and Disability Services

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