Medicaid and Permanent Supportive Housing for Chronically Homeless Individuals: Emerging Practices From the Field. 9.3. Many Alternatives Available, and Useful


Chapters of this report have described many strategies being used in our case study sites to expand and integrate health and behavioral health care under Medicaid for our target population, and often for far larger groups such as all poor people (coverage expansion waivers, Accountable Care Organization), or all people with complex interacting disabilities (Together4Health). These strategies could be used alone or in combination--most of our sites are working on more than one. We review them briefly here.

9.3.1. Health Centers

Health Care for the Homeless (HCH) programs and other Health Centers receive Medicaid reimbursement as Federally Qualified Health Centers (FQHCs). They are obvious agencies to consider as providers of health care for people experiencing homelessness. Given their mission to serve low-income people and, for HCH programs, homeless people in particular, Health Centers could be a great force for linking primary care, behavioral health, and other services and supports for people experiencing homelessness who have complex chronic conditions and those who have become PSH tenants.

The enhanced Medicaid reimbursement rates FQHCs receive seem to offer resources sufficient to work successfully with people whose health conditions are complex and require more time and coordination to address.

We saw some promising models of Health Center involvement in our research. These include co-locating FQHCs or staffing satellite FQHCs that operate for a few hours a week in or near PSH (Chicago, Los Angeles, and Minneapolis) or in offices where many PSH tenants come (District of Columbia), using multidisciplinary mobile teams (Los Angeles), and having special initiatives targeted to frequent users of crisis care (Chicago and Los Angeles). All require Health Center staff to work "outside the walls" of their clinics, collaborating with staff of housing, behavioral health, and other agencies to deliver care where people live. Several of these efforts include outreach on the streets to serve people who are still homeless.

As promising as Health Center involvement is, we learned of significant challenges facing any Health Center that wants to serve people experiencing chronic homelessness or people with disabilities and histories of homelessness who live in PSH. Contacts in the community, either on the streets during outreach and engagement or in people's homes once they are housed, are difficult for some Health Centers to fit into their business model, particularly if they have limited experience serving people with mental illness or substance use disorders who are experiencing chronic homelessness. Other Health Centers have recognized the need to adjust productivity expectations for clinicians who deliver more flexible and integrated services as part of mobile teams or in satellite clinics serving PSH tenants and people experiencing chronic homelessness, and they have made the case to state auditors and Medicaid officials to recognize that per-visit costs associated with delivering this sort of care may be higher than health care services delivered in clinic settings.

Other challenges involve making partnerships work, dealing with the shifting landscape of managed care, and covering aspects of care that are essential but often are not covered by Medicaid payments to Health Centers (e.g., some outreach and case management services). As partnerships and new models of care are being developed to integrate the delivery of primary care and behavioral health services, Health Centers face additional administrative and billing complexities, particularly if Medicaid benefits and payment mechanisms for primary care, mental health, and substance use disorder services have not been fully aligned. Health Centers in our study sites offer examples of substantial progress in overcoming these challenges to develop strategies that help people who are or were chronically homeless to become Medicaid beneficiaries and to provide them with needed care both before and after they obtain housing.

Mental Health Care Systems

People experiencing homelessness and PSH tenants for whom providers are most able to access Medicaid coverage for needed services are those with mental illnesses serious enough to result in extensive functional impairment. All case study sites had well-developed systems of care under Medicaid's rehabilitative services option, and some also used other Medicaid provisions to support the care needed by PSH tenants and people experiencing chronic homelessness if they have serious mental illness.

Mental health agencies in case study sites offer their homeless, formerly homeless, and never-homeless clients a wide range of services. Eligibility for specific types of services depends upon the client's diagnosis and level of functioning. Each study site offers a range of mental health services that provide flexible and individualized supports and are often used to serve people in PSH. Called different things in different states--Community Support Services/Teams, Adult Rehabilitation Mental Health Services, Field Capable Clinical Services, Assertive Community Treatment, and Full Service Partnerships--all are intended to provide supportive services to keep people stable in the community and restore skills and functioning impaired by mental illness. As states have defined these benefits and service models, some have included provisions that allow or require delivering services in a range of "natural" settings outside of clinics or treatment facilities, and using staff who have personal experience with mental illness and recovery to provide peer support, with appropriate clinical supervision. Targeted case management, another Medicaid option, is used in some states to cover the services needed to help people with complex health conditions and histories of homelessness get housing and other benefits.

All case study sites reported similar challenges with providing full and appropriate care to even this bestserved population. The good news is that state Medicaid offices and service providers in several sites have worked together to develop strategies to reduce or eliminate gaps in payment availability for certain types of care by working to expand: (1) the services Medicaid will cover; (2) the group that can receive the expanded services; (3) the staff that can deliver the services; (4) the locations where they can be delivered; and (5) for how long they can be delivered. Changes negotiated in some sites include simplified documentation requirements and coverage related to a client's co-occurring substance use disorder, chronic health conditions, other needs related to health, wellness, and housing stability, and care coordination. Some key services that these sites have been able to include in Medicaid coverage involve helping people find, move into, stabilize, and keep housing; going to court and otherwise helping clients with justice system involvement; and collateral contacts on the client's behalf when the client is not present. Most importantly, some of the newer approaches include the costs of case management and services integration (e.g., team meetings, case conferencing) that evidence increasingly shows are effective to treat the whole person. States thinking about how to use their Medicaid programs to support PSH tenants and people still experiencing chronic homelessness will want to consider how these strategies might best be incorporated into their own plans.

Managed Care

Managed Care Organizations (MCOs) act as administrators and coordinators of care, paying for health care delivered by providers in many different agencies with which they have contracts or through other payment arrangements. Most families receiving Medicaid have been enrolled in managed care plans for years. Recently, a nationwide movement has begun to use managed care for seniors and persons with disabilities as well, which would include Medicaid beneficiaries who are homeless and those living in PSH.

Most of our case study sites saw a lot of changes in this regard starting in 2010. In that year, Illinois established MCOs for seniors and persons with disabilities in Chicago's ring counties; California began requiring MCO enrollment for most Medicaid beneficiaries in this population in Los Angeles and most other urban counties; and the District of Columbia established early expansion under the Affordable Care Act and enrolled all newly Medicaid-eligible persons into MCOs. Minnesota began enrolling seniors and persons with disabilities in Medicaid managed care in 2011. Louisiana switched most of its children and adults receiving behavioral health care to a new statewide behavioral health managed care organization in 2012. States expanding their Medicaid eligibility in 2014 are expected to place many if not all of the expansion population into managed care, for both medical and behavioral health care.

As with all other care structures we have examined in this study, the ability of MCOs to improve service comprehensiveness and coordination for people who are experiencing chronic homelessness and people living in PSH depends on many things. These include the types of care they can provide (depending on service definitions and other provisions in the Medicaid state plan as well as provisions in state contracts with MCOs that allow for re-investment of savings), the rates they are paid, the degree to which those rates are appropriately risk-adjusted, and the availability of agencies in the community with which the plans can contract to obtain covered services.

When Medicaid MCOs operate as full-risk entities, meaning they are at risk for paying for hospitalizations and other health care costs, it is in their financial interest to establish care structures that keep use of these expensive crisis and inpatient services to a minimum. Here their interests line up with the expertise of PSH programs, which have been well-documented as doing exactly that. Mental health service providers in Minnesota say the plans covering seniors and persons with disabilities have generally been good for mental health clients, including both currently homeless people and PSH tenants. The MCOs offer transportation to medical appointments, and some also offer fitness, health promotion, nutrition, dental, and care management services for their members.

Also in Minnesota, state contracts with MCOs serving seniors and persons with disabilities allow the plans to provide "in lieu of" services--meaning some services that are not defined in the state Medicaid plan but "make sense" because of the needs of members and the potential to achieve cost offsets. One Minnesota MCO, recognizing this alignment of interests and having on its rolls a significant number of currently and formerly homeless people with complex health and behavioral health care needs thanks to the state's early expansion of Medicaid eligibility, is contracting with community agencies to provide care designed to get people into housing and help them stay there (Medicaid does not pay for the housing itself). Recognizing that "If people aren't housed they cannot focus on health care," plan representatives believe that helping people get housing now will help keep them from becoming high-cost, frequent users in the future. These calculations are paying off in reduced medical costs.

In many states separate government agencies or divisions administer benefits for medical, mental health, and substance use disorder services, each with different rules and procedures governing provider qualifications and payment mechanisms. As a result, many community providers have not developed the capacity to offer fully integrated care for medical and behavioral health conditions. To the extent that PSH service providers are engaged in partnerships and capacity-building to offer more comprehensive and integrated care and care coordination, this may create opportunities for them to collaborate with MCOs.

MCOs usually receive a certain capitated payment, per-member per-month, and must cover an extensive package of Medicaid services used by enrolled members. Rate-setting for MCOs that serve people with complex health and social needs can be challenging. State Medicaid offices and MCOs have long been familiar with rate-setting for the average Medicaid recipient--a relatively young, relatively healthy, family with children. The new enrollees in Medicaid MCOs, including seniors and persons with disabilities and some of the adults who are newly eligible for Medicaid, have quite different health care service needs and different utilization patterns, creating a much broader range of costs for people within this group. Yet little systematic or realistic adjustment to capitation rates based on the complexity of a member's health conditions has been provided so far. There is still work to do to identify the risk factors most useful for adjusting rates (in addition to the age and geographic location factors that are the most commonly used today), but it is clear that much more sophisticated differential rate-setting will be needed if MCOs and providers are to survive financially while caring for and producing better health outcomes for seniors and persons with disabilities who have more complex health needs. This also applies to persons who are currently homeless and PSH tenants who have been prioritized for access to housing because of their vulnerability and patterns of high-cost service utilization.

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