From Institutions to Community: How Long-Term Services Evolved
April 21, 2026
Why does Colorado’s long-term services and supports (LTSS) system work the way it does today? In part two of our series, we explore how the system has evolved, from a reliance on institutional care to the growth of home and community-based services, and what that history means for individuals, families, and providers navigating services today.
Part of the “Understanding Colorado’s Long-Term Care System” series
By Amy Becerra, Chief Strategy Officer
In the first article in this series, we walked through how Colorado’s long-term services and supports system is structured today — who makes decisions, how funding flows, and how services are delivered.
But to fully understand why the system looks the way it does, it helps to understand how it evolved.
Because it hasn’t always looked like this.
Where Long-Term Care Began
When Medicaid was first established in 1965, long-term care was primarily designed around institutional settings.
For individuals with significant disabilities or complex medical needs, that often meant living in a facility — sometimes for years, and in many cases, for a lifetime.
I was introduced to this reality early on. My grandmother worked as a nurse in an institution, and she would sometimes bring children home with her on the weekends. Many of them had been placed there as infants and had little or no connection to family. At the time, that was simply how the system functioned.
Over time, people began to question whether that was the right approach.
A Shift in Perspective
Families, individuals with disabilities, and advocates started asking a different question:
Why should someone have to live in an institution to receive the support they need?
For many, institutional care meant being separated from family, community, and everyday life. It often came with limited autonomy and, in some cases, exposure to neglect or abuse.
As awareness grew, so did the belief that people with disabilities should have the opportunity to live in their communities — to work, build relationships, and participate in daily life — with the right supports in place.
This was not just a policy shift. It was a shift in values.
The Challenge: How Do You Pay for It?
As this movement gained momentum, states were faced with a practical challenge.
Medicaid required states to provide institutional care. But providing services in the community was not built into the original structure in the same way.
There was also an important constraint:
Any alternative to institutional care needed to be cost-effective.
In other words, states needed to demonstrate that supporting someone in the community would not cost more than providing care in a facility. That requirement shaped what came next.
The Emergence of Waivers
To create flexibility, the federal government allowed states to apply for what are known as Medicaid waivers.
These waivers allow states to “waive” certain requirements of the Social Security Act in order to provide services in new ways — including home and community-based services (HCBS).
Through these waivers, states could:
- Expand eligibility criteria for long-term care services
- Offer supports outside of institutional settings
- Design programs tailored to specific populations
This is how home and community-based services began to take shape.
What Changed — and What Didn’t
The introduction of HCBS waivers created new opportunities for individuals to receive care in their homes and communities rather than in institutions.
Over time, these services expanded significantly and became a central part of the long-term care system.
But some important structural elements remained:
- Institutional care is still a required Medicaid benefit
- Community-based services are often authorized through waivers
- Funding and capacity can vary based on state decisions and available resources
This means the system today reflects both its origins and its evolution.
Why This History Matters
Understanding this history helps explain some of the dynamics we see today.
It helps explain:
- Why certain services are required while others are optional
- Why funding decisions can have different impacts across programs
- Why access to services may be shaped by both policy and resource constraints
It also helps explain why the system can feel complex — because it was built in layers, over time, in response to both policy requirements and changing values.
Where We Are Today
Today, Colorado’s long-term services and supports system includes both institutional and community-based options.
For many individuals and families, community-based services provide a pathway to greater independence, connection, and quality of life.
At the same time, the system continues to operate within the broader structure of Medicaid — shaped by federal requirements, state policy decisions, and available funding. That balance continues to evolve.
Continuing the Conversation
This history is an important part of understanding how the system works — but it’s only one piece.
In the next article, we’ll take a closer look at how Medicaid funding works, including how federal and state dollars come together and how those decisions shape the services that are available.
Understanding how the system is funded helps explain not just how it operates, but also why changes happen — and how they are felt across the system.
