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The Business Case for Medicaid-Financed Services in Supportive Housing

(from the Corporation for Supportive Housing) Medicaid expansion under the Affordable Care Act will provide new insurance coverage to nearly all of the 1.2 million individuals who are homeless. This new brief outlines the rationale for states to consider designing Medicaid-financed, supportive housing-based care management services to improve care for high-need beneficiaries who are homeless. The brief, by CSH and the Center for Health Care Strategies was released today at CSH’s Supportive Housing Leadership Forum in Chicago and was supported by Robert Wood Johnson Foundation.Medicaid expansion under the Affordable Care Act (ACA) will provide new insurance coverage to more individuals who are homeless. States could consider leveraging various Medicaid service options, such as health homes, to provide these new beneficiaries with care management services linked to supportive housing.

Medicaid-financed care management in supportive housing for high-risk homeless Medicaid beneficiaries could yield a significant ROI from reduced hospitalizations and emergency department use. Growth in Medicaid managed care for these individuals, particularly after 2014, will expand opportunities to capitalize on care management linked to supportive housing with the prospect for sharing associated savings across providers, health plans, and states.

For many individuals with complex chronic health conditions, homelessness and housing instability can be the most significant impediments to health care access, often resulting in excessive utilization of expensive inpatient and crisis services. For these individuals, supportive housing offers an evidence-based solution to improving health outcomes while reducing costs. By providing stable affordable housing coupled with “high touch” supports that connect people with chronic health challenges to a network of comprehensive primary and behavioral health services, supportive housing can help improve health, increase survival rates, foster mental health recovery, and reduce alcohol and drug use among formerly homeless individuals. To help states prepare for Medicaid expansion and anticipate the needs of this high-need population subset, this brief:

1. Outlines the potential benefits of care management linked to affordable housing;
2. Details the business case for using Medicaid to finance supportive housing-based services from the viewpoint of Medicaid as well as the supportive housing industry sector;
3. Highlights potential Medicaid authorities that states can use to fund supportive housing-based services; and
4. Raises considerations for policymakers to address in designing strategies that use Medicaid resources to provide supportive housing-based services for people who are homeless.

Download the brief here.