Understanding the New Medicaid Waiver Category in the One Big Beautiful Bill Act

Families who rely on home and community-based services through Medicaid are navigating an important policy change this summer. On July 4, 2025, the federal government passed the One Big Beautiful Bill Act (OBBBA), a sweeping reconciliation package that includes changes to multiple public programs, including Medicaid. One of the most notable provisions for families like those we serve at At Home Palmetto is the creation of a new category under the Medicaid 1915(c) Home and Community-Based Services (HCBS) waiver program.

This new waiver option is designed to expand access to support for individuals who do not meet the current institutional level of care criteria, but who still need in-home assistance to maintain safety, stability, and independence. Historically, 1915(c) waivers have been limited to individuals whose needs would otherwise qualify them for placement in a skilled nursing or intermediate care facility. The new category provides states the option to serve a broader group of individuals with functional limitations before their needs escalate to that level.

For families, this shift could mean earlier access to supportive services such as personal care, respite, or assistance with daily living activities—without having to wait for a formal institutional-level diagnosis. The federal government has allocated $50 million in fiscal year 2026 and $100 million in fiscal year 2027 to help states develop and implement this new waiver option. However, it’s important to understand that participation is optional. States must submit their own waiver applications to the Centers for Medicare and Medicaid Services (CMS), and no state is automatically enrolled.

As of the publication date of this blog, South Carolina has not yet submitted a waiver application for this new category. That means families in our state cannot currently access services under this new provision. However, we encourage families to stay informed. Changes like this often roll out in phases, and South Carolina may choose to participate in the future. If and when the state does move forward, it will be through a formal CMS submission and public notification process.

At At Home Palmetto, we have years of experience supporting families navigate existing Medicaid waiver programs, including Community Choices, Medically Complex Children, and the ID/RD waiver. Learn more about all South Carolina waivers here. While we do not provide waiver application assistance or determine eligibility—that must be handled directly with state Medicaid offices—we believe education is a key part of empowering the families we serve. Understanding what options may be on the horizon can help families plan more confidently and advocate more effectively for their loved ones.

In the meantime, families should continue monitoring the South Carolina Department of Health and Human Services (SCDHHS) website for updates and announcements. Organizations such as Family Connection of South Carolina and your local Council on Aging office may also provide alerts when new waiver programs are proposed or adopted.

Policy changes can feel overwhelming, but understanding what’s changing—and what’s not—makes a big difference. As always, our team remains committed to providing clear, compassionate information to help families make informed decisions about care. We’ll continue to monitor this policy development closely and provide updates as more information becomes available.

Also note: As of now, the new waiver created under the One Big Beautiful Bill Act does not have an official name.

It is simply described in the legislative and policy documentation as a new optional category under Section 1915(c) of the Social Security Act, allowing states to offer Home and Community-Based Services (HCBS) to individuals who do not meet the institutional level of care requirement.

What it’s being called in policy briefs:

• “New 1915(c) HCBS waiver for individuals below institutional level of care”

• “1915(c) expansion for non-institutional-eligible populations”

• “OBBBA 1915(c) flexibility provision”

Why there’s no formal name:

Because this isn’t a separate program, technically—it’s a state option within the existing 1915(c) waiver authority—there is no official CMS-issued title. If and when South Carolina (or any state) submits its own version of this waiver, the state may name it something specific (e.g., “Independence at Home Waiver” or similar). But federally, it remains unnamed and generic.

If you have anymore questions about how the One Big Beautiful Bill Act may affect your current services or want help interpreting notices related to your existing waiver, feel free to reach out. We’re here to support you with information you can trust, and care so good, you’ll call us family.