Money Follows the Person

Money Follows the Person (MFP) is a federal program that helps people who live in nursing homes and other institutions move back to their own homes, apartments or small community settings, with the services they need. It was created by the Deficit Reduction Act of 2005 and has been extended several times. Most states take part. This guide explains who MFP serves, what it provides, how the move works and the current funding timeline.

Figures change periodically. Double-check current amounts before relying on them.

The short version

MFP helps Medicaid-eligible people who have lived in a qualified institution, such as a nursing home or hospital, for more than 60 consecutive days move to a qualified community residence.
It pays for transition services, such as help finding housing, security deposits, furniture and household items, and transition coordination, along with home and community-based services.
States receive enhanced federal funding for 12 months of community services for each person who moves, and must continue services afterward as long as the person remains eligible.
Congress funded MFP through federal fiscal year 2027 (ending September 30, 2027), with states able to continue transitions and spending for several more years under the grant rules.
Participation is voluntary. Each participating state runs its own MFP program, often under a state-specific name.

History and current funding

MFP was established by section 6071 of the Deficit Reduction Act of 2005. The Affordable Care Act extended it and lowered the minimum institutional stay from six months to 90 days. The Consolidated Appropriations Act, 2021 lowered the minimum stay to 60 consecutive days (with short-term rehabilitation days able to count) and extended funding. The Consolidated Appropriations Act, 2023 then provided $450 million a year for fiscal years 2024 through 2027 and extended the program through September 30, 2027. According to the federal program inventory, grantees can continue transitioning participants until December 31, 2029, with services eligible for the enhanced match through December 31, 2030.

Who qualifies

To take part in MFP, a person generally must:

live in a qualified inpatient facility, such as a nursing home, hospital, institution for mental diseases (for certain ages) or intermediate care facility for individuals with intellectual disabilities;
have lived there for more than 60 consecutive days;
be eligible for Medicaid for at least one day before the move;
want to move to a qualified residence: a home owned or leased by the person or a family member, an apartment with an individual lease, or a community residence where no more than four unrelated people live.

States may set additional criteria, and some focus on specific groups, such as older adults, people with physical disabilities, or people with intellectual or developmental disabilities.

What MFP provides

Transition services

a transition coordinator who helps plan the move;
help finding accessible, affordable housing;
one-time costs, such as security deposits, utility setup fees, basic furniture, kitchen supplies and bedding;
home modifications, such as ramps and grab bars;
assistive technology and equipment.

Community services

After the move, the person receives home and community-based services, such as personal care, homemaker services, adult day care, home health, case management and other waiver or state plan services. Many states also provide “supplemental” or “demonstration” services during the first year, such as extra support from a nurse or peer mentor.

The 12-month period

MFP participation, with enhanced federal funding, lasts for 365 days after the move. After that, the person continues to receive community services through the state’s regular Medicaid programs, as long as they remain eligible.

How the move works

Interest and referral. The resident, family, nursing home staff, the long-term care ombudsman or others refer the person to the state MFP program. Nursing homes must ask residents about their interest in returning to the community during regular assessments.
Assessment. A transition coordinator meets the person, reviews needs and preferences, and checks eligibility.
Planning. The team develops a transition plan covering housing, services, equipment, medications, transportation and backup supports.
Housing. The coordinator helps find a place to live, which can take time where affordable accessible housing is scarce.
Move. On moving day, services, equipment and supplies are in place.
Follow-up. The coordinator checks in regularly during the first year.

Benefits

Lets people live in the setting they prefer.
Gives one-time help with costs that often block a move, like deposits and furniture.
Coordinates services so the move is safe.
Can help free up waiver slots or provide priority access to community services in some states.

Challenges

Housing shortages. Finding affordable, accessible housing is often the biggest barrier.
Workforce shortages. Home care aides may be hard to find.
Income for living costs. Once at home, the person must pay rent and food from income. Nursing home residents on Medicaid often have given up their homes, so starting over can be expensive.
Medical complexity. Some people need more care than community services can provide.

Medicaid eligibility considerations

A person leaving a nursing home may need to adjust their Medicaid. For example, income rules for community programs may allow them to keep more income for living expenses. Married couples should review the spousal allowances. A person who kept a home under the “intent to return” rule may be able to move back there. See Intent to return home.

A simple example

Dennis, 67, had a stroke and has lived in a nursing home on Medicaid for eight months. His therapy has helped him regain some independence, and he wants to live on his own again. A social worker refers him to the state’s MFP program. A transition coordinator helps him find an accessible apartment, pays his security deposit, buys a bed, table and kitchen basics, and arranges a grab bar and shower chair. After the move, he receives a personal care aide each morning and a home health nurse weekly. After his first year, he continues on the state’s waiver.

Getting help

The nursing home social worker, the long-term care ombudsman, or the state Medicaid agency can connect a resident with MFP. A Certified Medicaid Planner can help sort out how income and assets will be treated after the move, especially for married couples.

Frequently asked questions

Is MFP available in every state? Most states participate. Each state runs its own program, sometimes under a different name.

Do I need to be on Medicaid? Yes, for at least one day before the move.

Can I move in with family? Yes, if the home is a qualified residence.

What happens after the first year? Services continue through regular Medicaid programs, as long as you remain eligible.

Key terms

Qualified institution: a nursing home, hospital or similar inpatient facility from which MFP helps people move.
Qualified residence: a home, apartment with an individual lease, or small community residence of no more than four unrelated people.
Transition coordinator: the person who plans and arranges the move.
Enhanced federal match: extra federal funding the state receives for community services in the participant’s first year after the move.

Common barriers and how families handle them

No housing. Ask the transition coordinator about housing vouchers, public housing waiting lists, accessible units and living with family.
No furniture or household items. MFP transition funds can often pay for basics.
Home not accessible. Ask about modifications through MFP or the waiver.
Worries about safety. Ask for a backup plan, emergency response system and regular check-ins.
Income too low for rent. Ask how community income rules will apply, and about housing assistance.

A second example: moving in with family

Lorraine, 78, has lived in a nursing home for a year after a hip fracture and wants to live with her daughter. Her daughter’s home has stairs at the entrance and a small bathroom. Through MFP, a transition coordinator arranges a ramp, grab bars and a shower chair, and sets up personal care aide visits and adult day care two days a week. MFP pays for a hospital bed and bedding. Lorraine moves in, and her daughter receives respite through the waiver.

Questions to ask the transition coordinator

How long does the transition process usually take here?
What housing options are available, and is there help with rent?
Which services will be in place on moving day?
What happens if the move does not work out?
Who do I call if a caregiver does not show up?
What happens after the first year?

Is MFP the right choice?

MFP works best for people who want to leave a facility, have health needs that can be met at home, and have a plan for housing and backup support. It may not be right for someone who needs constant skilled nursing.

Families can raise MFP at any care plan meeting; residents can also ask the nursing home social worker directly to make a referral.

Even residents who are unsure can ask for an information visit without committing to a move.

Last updated for 2026. General information only, not legal or financial advice. Medicaid Answers is a free educational resource published by Medicaid Answers Foundation.