Requires Medicaid coverage for assisted living services for individuals with serious mental illnesses.

This bill requires New Jersey's Medicaid program to cover assisted living services for individuals diagnosed with serious mental illnesses who can perform basic self-care tasks (like bathing and dressing) but cannot manage more complex daily living activities necessary for independent living (such as managing medications, following treatment plans, or handling finances). The bill defines "instrumental activities of daily living" as those complex tasks needed for independent community living, and mandates that the Commissioner of Human Services establish a functional assessment process using medical records, psychiatric history, and input from healthcare providers and family members to determine eligibility. The Commissioner must also apply for necessary federal Medicaid plan amendments to implement this coverage, which would directly affect individuals with serious mental illnesses who currently lack access to Medicaid-covered assisted living services. This policy change would expand Medicaid coverage to include a specific type of assisted living care that is currently not covered under New Jersey's Medicaid program.