HUD HCV Guidebook § 3.5.2

Individuals with disabilities have historically faced discrimination that limited their opportunities to live
independently in the community and resulted in them living in institutions and other segregated settings. In
1999, the U.S. Supreme Court issued a landmark decision in Olmstead v. L.C., 527 U.S. 581 (1999) affirming
that the unjustified segregation of individuals with disabilities is a form of discrimination prohibited by Title II
of the ADA. The Olmstead ruling means that states and localities cannot require persons with disabilities to
reside in nursing homes, state psychiatric hospitals, or other institutional settings in order to receive
necessary services if those services could reasonably be provided in integrated, community-based settings.
Specifically, the Court held that public entities must provide services to persons with disabilities in community
settings rather than institutions when:
    •    Such services are appropriate to the needs of the individual,
    •    The affected persons do not oppose community-based treatment, and
    •    Community-based services can be reasonably accommodated, considering the resources available to
         the public entity and the needs of others who are receiving disability-related services from the
         entity.115

Under the decision, State governments must develop plans to transition individuals with disabilities from
institutional to community-based settings.

As a result of the Olmstead decision, there have been increased efforts to assist individuals with disabilities
who are institutionalized or reside in other segregated settings to move to integrated, community-based
settings. State health care delivery systems are shifting away from an overreliance on providing long-term
services via institutions, hospitals, nursing homes, adult care facilities, and other restrictive, segregated
settings and moving towards a greater reliance on home and community-based services. In many areas of the

114 For more information on public entities’ obligations under Olmstead, please refer to the Statement of the Department of Justice on

Enforcement of the Integration Mandate of Title II of the Americans with Disabilities Act and Olmstead v. L.C. Individuals may also
contact the Department of Justice and refer to resources online at www.ADA.gov or by calling the ADA Information Line at (800) 514-
0301 (voice) or (800) 514-0383 (TTY).
115 Olmstead v. L.C., 527 U.S. 581 (1999).

Fair Housing and Nondiscrimination Requirements                                                                           30
US Department of Housing and Urban Development                                                                    April 2025

country these efforts to comply with Olmstead are confounded by a lack of integrated housing options for
persons with disabilities. As a result, there is a great need for affordable, integrated housing opportunities
where individuals with disabilities can live and interact with individuals without disabilities, while receiving the
health care and long-term services they may need. HUD encourages PHAs to partner with state and local
governments to provide additional community-based, integrated housing opportunities for persons with
disabilities transitioning out of, or at serious risk of entering, institutions or other segregated settings.

HUD also encourages PHAs to implement preferences that support Olmstead efforts. General preferences for
persons with disabilities who are transitioning from or at serious risk of entering an institutional setting are
permissible. Preferences that target individuals with specific disabilities or diagnoses may be authorized in
connection with remedial actions undertaken pursuant to DOJ enforcement, Olmstead-related settlements or
litigation, and state and local governments’ voluntary, documented affirmative Olmstead planning and
implementation efforts. Since targeted preferences for specific disabilities can only be authorized as remedial
actions, such preferences must be reviewed and approved by the Office of General Counsel’s Office of Fair
Housing at HUD. PHAs also must request a waiver of HUD’s program regulations that prohibit disability-
specific preferences.116

For more information on the integration mandate under Section 504 and HUD’s support of Olmstead
enforcement and implementation efforts, please refer to the Statement of the U.S. Department of Housing
and Urban Development on the Role of Housing in Accomplishing the Goals of Olmstead,117 or contact the
Associate General Counsel for Fair Housing.