Medicaid Financing for Services in Supportive Housing for Chronically Homeless People: Current Practices and Opportunities. 9. Conclusions and Implications


Many people are applying considerable effort to finding ways to use Medicaid more consistently to reimburse the costs of services to address the health and behavioral health problems of formerly homeless PSH tenants in ways that help them stay healthy and housed. One of the questions looming over PSH providers--how can we get our clients enrolled?--will change in 2014, when nearly all of their clients will become Medicaid-eligible. But these providers may still need help bringing Medicaid-reimbursed services to their clients. The biggest remaining questions are: “What can be done to get the most effective mix of services covered through Medicaid?” and “What can be done to simplify the reimbursement process?”

The environmental scan conducted for this project found some promising approaches to using Medicaid to finance effective models of care for chronically homeless people with complex health and behavioral health problems. Among those that seem to help fund services in PSH are approaches that:

  • Support partnerships or expansions of organizational capacity and development of clinical practices and tools (such as integrated intake and service records) that integrate care for medical and behavioral health problems and reduce fragmentation.

  • Adapt medical/service necessity criteria to recognize complex co-occurring conditions and homelessness in addition to a single diagnosis, instead of requiring that every service be justified in terms of a client’s mental illness.

  • Establish payment mechanisms that enable interdisciplinary teams to deliver services.

  • Adapt “gatekeeping” or Utilization Review functions to accommodate hard-to-engage and highly vulnerable homeless people.

  • Invest in building the capacity of non-traditional service-providers who serve very vulnerable homeless adults (including organizations providing services in PSH) to become qualified Medicaid providers, and to establish administrative capacity to bill for services.

Documenting the strategies that are a growing part of current practice can encourage broader use of these practices. These include Medicaid-covered services such as CSTs or the delivery of primary care and behavioral health services provided by FQHCs. In addition, the ACA creates or supports the expansion of many innovations in care delivery and financing. Some of these seem particularly promising for improving care for people who are chronically homeless and providing opportunities or incentives to link health care to permanent housing. These include:

  • Health homes.

  • Behavioral and Primary Care integration demonstrations.

  • 1915(i) HCBS Option.

  • Dual-eligible demonstrations.

The outlook is mixed for states to move in the direction of providing Medicaid coverage and reimbursement for more services for chronically homeless people with complex health and behavioral health problems. Even when federal matching rates are high--as they are for the new Health Home Medicaid Option--states are wary of expanding benefits if they cannot limit fiscal risk for costs in future years. Many states now have significant budget shortfalls, often accompanied by hiring freezes, layoffs, and/or unpaid furlough days for state workers, against a backdrop of prolonged budget battles playing out in state capitals. This makes it harder for staff and agency leaders to do the labor-intensive work of engaging with local stakeholders and federal officials to develop new programs or amend state Medicaid Plans in order to help move chronically homeless people into permanent housing and support them while they are there, while avoiding the costs for emergency, inpatient, and long-term care for this population.

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