MedicaidCoverageMedium impact
Medicaid 1135 Alternative Settings Waiver Is Discontinued
Illinois Medicaid - HFS·IL · Psychiatry, Geriatrics·Provider Notice
Effective date
Jun 6, 2022
We identified it
Jun 20, 2026
Summary
The Medicaid 1135 Alternative Settings Waiver that allowed nursing facilities, ICF/IID facilities, and psychiatric residential treatment facilities to receive full reimbursement for services in unlicensed facilities has been terminated by CMS as of June 6, 2022. Providers can no longer bill for services under this waiver unless they request and receive individual approval through a specific CMS form.
Action Required
Immediately: Facilities that were billing under the 1135 Alternative Settings Waiver must stop billing for services rendered in unlicensed facilities. If continued flexibility is needed, submit individual waiver requests to CMS using the CMS 1135 Waiver / Flexibility Request and Inquiry Form. Contact Bureau of Long Term Care at 844-528-8444 with questions.