The Florida Agency for Health Care Administration (AHCA) issued a report last month to meet legislative direction in Senate Bill 1490 (2025) requiring a comprehensive plan to redesign Florida Medicaid’s Model Waiver, a Section 1915(c) home- and community-based services (HCBS) waiver to include children who receive Private Duty Nursing (PDN) services. The legislature directed that the redesigned waiver propose an array of tiered services to help prevent institutional care and support children remaining safely at home or in community settings, with required stakeholder engagement and detailed fiscal projections, an implementation plan, and a workforce availability analysis. 

Background and Current Service Delivery Model

Florida delivers most Medicaid medical services through the Statewide Medicaid Managed Care (SMMC) Managed Medical Assistance (MMA) program under a Section 1115 waiver. For children under age 21 with complex medical needs, current Medicaid State Plan services include PDN, intermittent home health visits, family home health aide services, and personal care services, among others. PDN consists of skilled nursing services provided in the home by a registered nurse (RN) or licensed practical nurse (LPN) for 2 to 24 continuous hours per day. The report estimates that approximately 3,200 Florida Medicaid children receive PDN services, and most (about 98%) receive services through an SMMC plan rather than fee-for-service Medicaid. 

Florida’s existing Model Waiver currently serves only a very small population — up to 20 children under age 21 — primarily children with degenerative spinocerebellar disease or children who are medically fragile and have resided in a nursing facility for at least 60 days before enrolling. At the time of the report, only a handful of children are enrolled. The current Model Waiver adds limited services beyond State Plan coverage, including respite care, environmental accessibility adaptations, and transition case management, and it also allows certain children to qualify without counting parental income when determining Medicaid eligibility for the waiver. 

Rationale for Redesign

AHCA explains the redesign is driven by both legislative direction and broader system needs, including lessons from stakeholder engagement and the state’s ongoing efforts related to federal litigation (United States v. Florida). AHCA reports that stakeholders consistently raised concerns that families often lack service options between highly skilled PDN and lower-intensity supports, and that an expanded menu of respite options is needed. AHCA also notes that some families may be using a portion of PDN hours for support with activities of daily living (ADLs) and instrumental activities of daily living (IADLs) — tasks that may not always require a nursing level of skill — because there are limited clinically appropriate alternatives available in the current Medicaid service array. 

Proposed Redesign: Expanded Eligibility and Tiered Services

AHCA proposes expanding Model Waiver eligibility to include a third population: children under age 21 who receive or are determined to require more than 12 hours per day of skilled monitoring and intervention for at least six consecutive months within the prior one-year period. AHCA projects this would include approximately 2,543 children. Existing waiver capacity reserved for current eligibility categories would remain (including reserved slots for the original populations), and waiver participation would operate on a first-come, first-served basis with no waiting list. 

To “fill the gap” between PDN and personal care services, AHCA also proposes a new waiver service: pediatric nurse aide services. This new service would provide extensive hands-on assistance with ADLs and IADLs for medically complex children when the child’s needs exceed what personal care services typically address but do not require PDN-level skilled nursing. AHCA indicates it intends to work with the Florida Department of Health (DOH) and the Florida Board of Nursing (BON) to define the provider type and align it with Florida’s Nurse Practice Act, and notes statutory authority may be required to establish licensure or related credentialing. AHCA also intends for pediatric nurse aide services to include a participant-directed option, supported by competency assessment requirements. 

In addition to creating pediatric nurse aide services, the redesign would enhance or expand current waiver services:

• Respite care would be expanded to include both skilled and non-skilled provider types and include an increased reimbursement rate, while maintaining the existing annual service limit.
• Transition case management would be expanded beyond nursing facility transitions to include a broader range of transitions (for example, transitions to adult Medicaid programs, transitions to school settings, and transitions when acuity changes).
• Environmental accessibility adaptations would increase from a $5,000 annual limit per recipient to a proposed $7,500 annual limit per recipient.

Service Delivery and Eligibility Determination

AHCA proposes continuing to use the existing eligibility determination pathway involving the DOH’s Children’s Medical Services (CMS) Children’s Multidisciplinary Assessment Team (CMAT). Under the proposed model, the child’s SMMC care coordinator would inform families about waiver services and refer interested families to CMAT for level-of-care determination. AHCA would manage enrollment, and waiver services would be delivered through SMMC plans, with the Plan of Care directing both waiver services and State Plan services (including PDN). 

Fiscal Impact and Key Assumptions

AHCA, working with Health Management Associates (HMA) and using managed care cost inputs from its atuarial vendor, assumes that:

• 20% of waiver-eligible children would substitute a portion of PDN hours with pediatric nurse aide services, reducing PDN hours by roughly 15–25% for that group.
• Pediatric nurse aide services would be reimbursed at approximately $24 per hour, compared to a blended managed care PDN cost estimated at $51.79 per hour.
• Additional waiver services would have substantial uptake (for example, respite care assumed at 75% of eligible children, home modifications at 60%, and transition case management at 20%).

AHCA’s fiscal model is designed so that savings from substituting some PDN hours with a lower-intensity pediatric nurse aide service would offset the cost of adding and enhancing the additional waiver services. The report presents scenario-based estimates indicating the financial outcome depends heavily on participation levels in the substitution model.

Workforce Availability and Recommendations

AHCA identifies workforce capacity as a central operational risk — especially because pediatric nurse aides do not currently exist as a provider type in Florida and would likely be developed as a specialized subset of certified nursing assistants (CNAs). The report cites projected shortages in the CNA workforce and notes broader shortages among nursing staff and direct care workers, including home health and personal care aides. 

To improve service availability, AHCA recommends steps such as: collaborating with the Florida BON to create the pediatric nurse aide designation, implementing participant-directed service options to increase flexibility and expand labor supply, strengthening recruitment and training pipelines, and improving family awareness and navigation support for respite options. 

Implementation Timeline and Major Steps

AHCA proposes a 36-month implementation period beginning in July 2026 and culminating with services beginning in Quarter 4 of Fiscal Year 2028–2029. Key steps include:

• Continued stakeholder engagement and service design refinement
• Defining provider qualifications, training, and service definitions (including pediatric nurse aide scope and credentialing)
• Preparing and submitting necessary waiver amendments (including references to Section 1915(c) and Section 1915(a) documentation) to the Centers for Medicare & Medicaid Services (CMS)
• Updating SMMC capitation rates to support a separate payment structure for waiver enrollees
• Updating rules, policies, contracts, and plan operational readiness (information technology systems, billing, handbooks, readiness reviews)
• Communication and education for families, plans, providers, and CMAT teams
• Go-live and ongoing quality improvement monitoring

HCAF will continue to engage closely with AHCA throughout stakeholder discussions and as the implementation timeline unfolds.

Click here to access the proposed redesign report.