Medicaid Can Pay for Services for People in Permanent Supportive Housing

Those of us working to end homelessness have long known that for people with chronic health conditions experiencing homelessness, the path to better health starts with housing. Time and time again, permanent supportive housing has been shown to improve health and behavioral health outcomes, while actually lowering health care costs by stopping the revolving door of repeated emergency room use and hospitalizations. Despite this evidence, permanent supportive housing has historically not been viewed as a health care intervention or service. Even the case management and supportive services provided in supportive housing have seldom been covered under and financed by Medicaid, despite the fact that these services are critical to helping people navigate health care services and shift their patterns from acute care and crisis services to primary and preventive care.

Two new documents released by HHS on October 10 make it clear, once and for all, that the services provided in permanent supportive housing can indeed be covered and financed by Medicaid. These documents are Primer on Using Medicaid for People Experiencing Chronic Homelessness and Tenants of Permanent Supportive Housing and Medicaid and Permanent Supportive Housing for Chronically Homeless Individuals: Emerging Practices from the Field. Specifically, Medicaid can cover things like case management, services goal setting and services coordination, health care navigation, rehabilitation, skill building around activities of daily living, and other supports that are critical to tenancy.

In fact, as these documents make clear, States have several options for covering services for people in permanent supportive housing under their Medicaid plans. Among the options available to States to cover permanent supportive housing services include services provided by Federally Qualified Health Centers, Medicaid rehabilitative services, the 1915i Home and Community Based Services option, Medicaid Health Homes, and Targeted Case Management.

These options, along with the State option to expand Medicaid eligibility under the Affordable Care Act, create an unprecedented opportunity for our goal of ending chronic homelessness. In States expanding their Medicaid programs, nearly every individual experiencing chronic homelessness will be eligible for Medicaid. If States choose to adopt one or more of the options outlined in the primer, Medicaid can be a means of paying for nearly all of the critical services provided to people in permanent supportive housing.  Nonprofit housing and homeless services providers have the opportunity to receive Medicaid payment for services either by building their own capacity and infrastructure or by partnering with existing Medicaid providers like community health centers or mental health agencies.

Through Medicaid expansion, new authorities, and new emphasis on care coordination and “whole person” health, the Affordable Care Act has opened the door to bring permanent supportive housing to scale.  It’s now up to States and communities to walk through it. I believe that many more States will look to permanent supportive housing as they seek solutions that can achieve their goals of improving the health of their beneficiaries while controlling costs. Meanwhile, we need more Continuums of Care and homeless services providers to learn to speak the language of Medicaid.

USICH, HHS, and HUD are working to support this through additional information and technical assistance. HUD recently announced a new technical assistance effort that is focused on building the capacity of Continuums of Care and homeless services providers around Medicaid. USICH and HHS will release additional documents to supplement the primer and are exploring ways to also provide technical assistance.

The time is now to seize the opportunity, bring supportive housing to scale, end chronic homelessness, and bend the Medicaid cost curve. 

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Richard Cho is Senior Policy Director at USICH.