Inside and outside government, there is now a widely held view that home and community-based services (HCBS) can better maintain the independence and dignity of persons needing long-term services and supports (LTSS). Consistent with this understanding, statistics show a significant percentage increase in older persons able to receive LTSS outside of nursing homes. Nonetheless, unnecessary institutionalization is still a routine problem for too many older adults and people with disabilities, especially those with lower incomes.

In 1999, the United States Supreme Court ruled in Olmstead v. L.C. that unnecessary institutionalization of people with disabilities is a type of discrimination prohibited by the Americans with Disabilities Act (ADA). A state government that operates its programs in a way that unnecessarily forces persons with disabilities to move into nursing homes or other institutions violates the ADA. Under the ADA, a state government is not required to make a "fundamental alteration" to a program to accommodate the needs of a person with a disability - but it can be required to make a "reasonable modification."