Medicaid Is For Healthcare; But In Washington, It Will Soon Pay For Housing Services, Too

Jan 30, 2017

Washington state will soon have the ability to tap federal Medicaid dollars to help chronically homeless people stay in apartments. 

The federal Center for Medicare and Medicaid Services gave state officials special permission  Jan. 9 to use Medicaid funds for certain aspects of a strategy called "permanent supportive housing."

That intervention has been reserved for the most intractable cases of long-term homelessness: people with serious behavioral or physical disabilities who can't find and keep an apartment without a lot of help. 

It involves someone getting heavily subsidized housing and daily visits from a case worker, typically from a nonprofit organization, who helps connect the client with healthcare and social services and aids in the day-to-day logistics of maintaining a home.

Medicaid won't pay for rent or the cost of building new housing, but it can reimburse nonprofits for their work helping formerly homeless people with daily tasks and adapting to life indoors. 

That work includes helping manage relationships with landlords, mitigating conflicts, dealing with paperwork, and caring for apartments.

"People who have lived outside for a long time have a different skill set than we do in terms of survival," said Debbie Thiele, director of consulting for the Corporation for Supportive Housing, a nonprofit policy and advocacy organization. "It takes a long time to work through the trauma of having had that experience and set yourself up again." 

Only California, Massachusetts, Texas, and Louisiana have versions of the Medicaid benefit for permanent supportive housing services, Thiele said. But she said Washington's stands to be the most comprehensive. 

It might sound strange to tap healthcare dollars for housing programs. But Nathan Johnson, chief policy officer for the state Health Care Authority, said housing and health are closely linked. 

"A stably-housed individual is much more prone to be successful in treatment, whether for medical and behavioral health conditions," Johnson said. "We see this benefit paying for itself in many ways."

Medicaid recipients with stable housing are more likely to receive preventative care and thus avoid costly emergency room visits, he said.

The new Medicaid benefit is projected to cost about $200 million over five years — including the cost of additional services that help formerly homeless people find and keep jobs, Johnson said. The money is expected to begin flowing in mid- to late-2017.

Housing advocates have sought the Medicaid allowance for several years, calling it a much-needed source of stable funding for an expensive but effective strategy. Nonprofits currently cobble together money for the housing services from a mix of short-term state and local funding and private donations. 

"We don't have enough service dollars available," said Kate Baber, a policy specialist for the Washington Low Income Housing Alliance. "So we're not able to bring this really effective, proven intervention to scale."

She said the Medicaid benefit "will help us make significant strides in reducing and eventually ending chronic homelessness."