Healthcare Business News

Illinois seeks waiver to use Medicaid funding on housing services for some enrollees

By Melanie Evans
Posted: January 25, 2014 - 12:01 am ET

Illinois plans to ask the CMS for permission to spend $60 million in Medicaid funding to help vulnerable enrollees find and maintain stable housing.

With the waiver, Illinois would join New York and counties in Minnesota and California in recent efforts to add housing to the list of healthcare services offered to chronically ill Medicaid patients.

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Proponents of the efforts say the potential health benefits of stable housing could reduce avoidable emergency room visits and hospital stays.

The evidence of savings from these initiatives is limited. This year's expansion of Medicaid under the Patient Protection and Affordable Care Act, though, has increased pressure on state officials and providers to find ways curb healthcare spending.

Under the waiver, Illinois would offer managed-care plans incentive payments for enrollees with mental illness or substance abuse disorders who successfully find temporary or permanent stable housing, consultants for the state told Illinois lawmakers.

The housing provision would allow Medicaid health plans to tailor services to what patients need to maintain their health, said Steven Glass, executive director for managed care for the Cook County Health and Hospitals System in Chicago.

“This is about the macro cost of care,” Glass said. Homeless Medicaid patients, for example, need somewhere to stay after surgery to prevent the risk of infection and readmission to the hospital, he said. “If I had the ability to spend Medicaid capitation on someone to have a place to live post-surgery, I would do it.”

The system's Medicaid managed-care plan won federal approval to begin early enrollment for adults who gained access to Medicaid under the Affordable Care Act. Enrollment began last year and the 72,000 enrollees include more homeless, chronically ill adults than before.

The Hennepin County (Minn.) Medical Center began to help secure housing for homeless patients two years ago.

New York unsuccessfully sought $75 million from the CMS to develop housing capacity for high-cost Medicaid enrollees. The state stripped the request from its pending Medicaid waiver last month.

But New York continues to seek $75 million to help chronically homeless, mentally ill or otherwise vulnerable adults live independently. Assistance—including counseling, employment aid, legal and budget help and case management—would be directed at those with high Medicaid costs.

Follow Melanie Evans on Twitter: @MHmevans

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