Beyond Medicine: Medicaid's Role in Bridging Healthcare and Housing
The evolving landscape of healthcare now acknowledges housing as a crucial element of well-being, marking a significant shift in public health recognizing certain goals advocates have trumpeted for decades - housing can be healthcare. Highlighted by a California Healthline article, this shift challenges old paradigms by recognizing stable, affordable housing as essential for optimal health outcomes. With states like California, Oregon, and New York at the forefront and thanks to a slew of waiver opportunitjes offered from the Biden Administration, some Medicaid programs are increasingly integrating housing services, reflecting a broader understanding that health is inextricably linked to our living conditions.
The Case for Housing as Healthcare: A Closer Look at the Evidence
The role of housing as a fundamental component of healthcare is being increasingly recognized among policymakers and supported by a growing body of evidence that underscores the critical impact of stable living conditions on health outcomes. The American Medical Association (AMA) has highlighted the essential nature of stable housing, pointing out that its absence significantly elevates the risk of various health issues, including severe infections that may necessitate amputation, and an increased likelihood of experiencing violent trauma.
Research featured in Health Affairs strengthens this viewpoint by establishing a clear link between housing stability and better health outcomes, emphasizing housing's non-negotiable position within a comprehensive healthcare framework. The benefits of stable housing can extend beyond physical health, with some studies showing significant mental health improvements through housing stability interventions, such as rental and foreclosure assistance.
The AMA further notes that people with access to stable housing are less prone to the stressors that lead to physical and mental health issues. Such environments reduce the risk of infectious diseases by providing a clean and secure living space conducive to health, facilitating easier access to medical care. Moreover, stable housing is linked to better chronic condition management, as it encourages an environment in which people can adhere to treatment plans and maintain regular contact with healthcare providers and is often accompanied with other medication necessities, such as food security and potable water.
Cost Savings and Healthcare Efficiency Through Housing
Integrating housing services into healthcare significantly enhances health outcomes and generates notable cost savings. By transitioning towards stable housing, reliance on high-cost healthcare services, such as emergency visits and hospital admissions, markedly decreases. A compelling study in Oregon demonstrated that providing affordable housing to nearly 10,000 individuals with unstable living situations resulted in a 12% reduction in Medicaid expenditures. Furthermore, this initiative increased outpatient primary care utilization by 20% and reduced emergency department visits by 18%, highlighting a shift towards preventive care.
This approach not only improves the health of Medicaid beneficiaries but also leads to more judicious healthcare spending. Allocating resources to housing services supports preventive care and vital services, amplifying the impact of stable housing on individual health and the overall healthcare system. Medicaid's strategic involvement in providing housing may prove a crucial tool for achieving better health outcomes and optimizing healthcare expenditure.
Medicaid Waivers and Housing Initiatives: Navigating New Pathways
The integration of housing services within Medicaid, facilitated by Section 1115 waivers and the innovative In Lieu of Services (ILOS) guidelines, represents a transformative approach to healthcare. These policy mechanisms are enabling states to address housing as a fundamental social determinant of health, acknowledging its critical impact on health outcomes.
Section 1115 Waivers: Expanding Medicaid's Reach
Section 1115 waivers grant states the flexibility to use Medicaid funds in novel ways that can include addressing housing instability, a key factor affecting health. The Kaiser Family Foundation reports on various state initiatives that leverage these waivers to directly tackle the housing needs of Medicaid enrollees. For example, some states have received approval to use Medicaid dollars for supportive housing services, such as helping people find and maintain stable housing. The programs with the best outcomes not o ly provide a method of entry but also work to ensure continuing housing stability. These waivers are instrumental in demonstrating how targeted housing support can lead to better health outcomes and reduced healthcare costs by minimizing the need for emergency care and hospital readmissions.
ILOS: Streamlining Support for Housing Needs
The Centers for Medicare & Medicaid’s (CMS) recent guidance on ILOS marks a significant policy shift, allowing Medicaid programs to offer housing-related services as enhancements to traditional medical interventions. This guidance enables states to provide a range of housing supports, including housing navigation assistance and one-time financial aid for security deposits or first month's rent. Importantly, while ILOS does not cover ongoing housing costs, it addresses critical barriers to stable housing for Medicaid enrollees, emphasizing the role of housing stability in achieving health equity.
State-Led Innovations in Housing and Health
States are at the forefront of integrating housing solutions within Medicaid, driven by the opportunities presented by Section 1115 waivers and ILOS guidelines. Shelterforce highlights innovative state programs that are setting precedents for how Medicaid can be utilized to support housing needs. For instance, initiatives that fund temporary housing for individuals transitioning out of hospital care not only provide immediate shelter but also contribute to better health outcomes and lower the likelihood of readmission. These programs exemplify the potential of Medicaid to address the holistic needs of its enrollees, underscoring the necessity of stable housing for overall health and well-being.
Through the strategic use of Section 1115 waivers and ILOS, Medicaid is evolving to meet the complex health and social needs of its enrollees. By recognizing housing as a critical component of healthcare, these policy innovations are paving the way for more integrated and effective approaches to improving health outcomes and advancing health equity. The success of state-led initiatives in leveraging these tools to address housing instability highlights the significant role of Medicaid in not only providing medical care but also in addressing the broader determinants of health.
Applying a Harm Reduction Perspective to Housing
Harm reduction in housing services adopts a compassionate approach, recognizing the varied challenges and needs of those facing housing instability. It emphasizes meeting people "where they are," providing flexible support without coercion, and respecting each person's autonomy and circumstances. This strategy is crucial for addressing the spectrum of housing stability, which ranges from homelessness to permanent, secure living situations. Each stage has unique health implications, with instability often worsening health conditions and hindering access to consistent healthcare.
Harm reduction aims to alleviate these health impacts by offering immediate, sometimes temporary, support to navigate towards more stable housing. This approach is vital for those with chronic health issues, mental health concerns, or substance use disorders, where a stable home can significantly influence health outcomes and quality of life. By tailoring services to meet personal needs—including healthcare access, mental health support, and substance use treatment—harm reduction in housing can effectively reduce the harms of instability and facilitate a path to stable living conditions.
Navigating Oversight in Medicaid's Housing Initiatives
The expansion of Medicaid to include housing services, aimed at addressing social determinants of health, introduces significant management and oversight challenges. A key concern is the potential for program exploitation, where resources meant for the most vulnerable are diverted or misused. The AIDS Healthcare Foundation (AHF) case, reported by the Los Angeles Times, exemplifies such risks, highlighting the need for stringent oversight to prevent organizations from prioritizing performance over patient care, qualityof life, and more permanent outcomes for program participants.
Ensuring Transparency and Accountability:
To counteract exploitation risks and guarantee the effective delivery of housing services, a strong emphasis on transparency, accountability, and comprehensive oversight is essential. The Center on Budget and Policy Priorities (CBPP) provides strategies for overseeing housing initiatives, stressing the importance of clear objectives, performance metrics, and consistent audits. These measures are vital for tracking service implementation, assessing health outcome impacts, and promoting ethical, efficient fund use.
Developing Robust Oversight Frameworks:
Implementing effective oversight requires layered scrutiny, including internal audits, external reviews, regular site audits, and autonomous, third-party feedback mechanisms for beneficiaries. Building partnerships across Medicaid programs, housing providers, healthcare entities, and community organizations can enrich oversight through varied insights and expertise. Such collaborative oversight efforts are pivotal in identifying and disseminating best practices, learning from experiences, and crafting innovative solutions to the intricate challenges of merging housing with healthcare services.
As Medicaid ventures into housing services, its success in enhancing health outcomes for vulnerable groups hinges on overcoming oversight hurdles. Committing to transparency, accountability, and strong oversight will protect against misuse, optimize resource allocation, and ensure housing's role as an integral part of comprehensive healthcare.
The Path Forward: Enhancing Medicaid's Role in Housing and Health Integration
As Medicaid evolves to more fully recognize housing as a crucial component of healthcare, a strategic and multifaceted approach is essential to ensure the effective integration of housing services. This approach should leverage the insights from recent policy developments and successful state initiatives, focusing on policy adjustments, increased funding, cross-sector collaboration, and robust oversight mechanisms.
Policy Adjustments and Increased Funding: A Foundation for Success
Policy Adjustments: Recent guidance on In Lieu of Services (ILOS) and the innovative use of Section 1115 waivers illustrate the potential for Medicaid to directly address housing instability. States should be encouraged to explore these and other policy tools to expand Medicaid's capacity to fund housing-related services, thereby acknowledging the profound impact of stable housing on health outcomes. Legislative and regulatory frameworks must evolve to support these changes, ensuring Medicaid can effectively contribute to housing stability for its enrollees.
Increased Funding: The expansion of housing initiatives within Medicaid necessitates substantial investment. This includes not only funding for direct housing assistance but also for the development of infrastructure that facilitates the delivery and coordination of services. Advocacy efforts are crucial to secure increased federal and state funding, aiming to bolster Medicaid's ability to meet the housing and health needs of its beneficiaries comprehensively.
Cross-Sector Collaboration: Building Bridges for Better Health
The success of housing initiatives within Medicaid is significantly enhanced by cross-sector collaboration. Partnerships among Medicaid agencies, housing authorities, healthcare providers, and community organizations are vital. These collaborations can draw on the strengths and resources of each sector to address the multifaceted challenges at the nexus of health and housing, creating integrated solutions that improve outcomes for individuals and communities alike.
Implementing Comprehensive Oversight and Adaptive Management
Comprehensive Oversight: To safeguard the integrity of housing initiatives and ensure resources are used effectively, a framework for comprehensive oversight is imperative. This framework should include clear implementation guidelines, success metrics, and regular evaluations to monitor impact and guide continuous improvement.
Adaptive Management: Effective management strategies are critical to navigate the complexities of integrating housing services within Medicaid. This includes ongoing training for program administrators and service providers, as well as the development of care models that seamlessly coordinate healthcare and housing services, ensuring that Medicaid enrollees receive the support they need to achieve and maintain stable housing.
The path forward for Medicaid's integration of housing services presents a unique opportunity to significantly improve health outcomes and advance health equity. By adopting a strategic approach that includes policy innovation, increased funding, cross-sector collaboration, and rigorous oversight, Medicaid can play a pivotal role in addressing the housing needs of its enrollees. This comprehensive strategy not only meets immediate housing challenges but also lays the groundwork for a healthier, more equitable future.
A Call to Action for Housing as Healthcare
The journey towards integrating housing into healthcare through Medicaid is not just a policy shift; it's a moral imperative. As we've seen, stable housing is not merely a foundation for individual well-being; it's a cornerstone of public health. The evidence is clear: when people have access to safe, stable housing, their health improves, healthcare costs go down, and communities thrive.
CMS Sides with the Devil: Insurers’ Co-Pay Accumulators Remain…for Now
The Affordable Care Act (ACA) was revolutionary in how prescriptive statutory language was in ensuring health insurers (payers) covered costs associated with pre-existing conditions, if they accepted even a penny of federal funding. The trade off was a simple theory: “cover more people and their entire health and we’ll make sure you’re still profitable”. There were hundreds of pages of caveats, definitions, incentives for public programs, pharmaceutical research, and regulatory authority passed to state and federal agencies. Everyone got a piece of the pie to the end benefit of Americans for whom health care had been out of reach for the majority of their lives. We would be healthier together by simply providing people the care we need and reducing overall costs. However, as these things go, payers are creative and pay their lawyers handsomely to find ways around that basic agreement. As payers fight to “contain costs”, co-pay accumulator programs are one of the most disingenuous methods to limit consumer access to quality care and pad payers profit margins.
From issues of discriminatory plan design, or making consumers pay the highest cost-sharing for medications which are only used to treat certain conditions like HIV, to limiting provider networks in such a way that a patient requiring a surgery or emergency care results in surprise bills to toxic practices known as “utilization management” (including, but not limited to, abusive prior authorizations and step therapy, also known as “fail first”), payers have paid their lawyers quite well to find loopholes or design new problems in order to maintain their profits. The ACA’s medical loss ratio (MLR) rule, also known as 80-20/85-15 rule (in general requiring 80% or 85% of a plans premiums to actually be used on costs of care or pay back to balance to consumers) has resulted in a startling 2 billion dollars to be paid back to consumers in 2019 alone. But the rule doesn’t necessarily count other income payers can produce by way of cost-sharing or deductible payments, co-pays (a fixed price typically paid after deductibles are met for care and medications), and – now, more commonly – “co-insurance” (a percentage price typically paid after deductibles are met for care and medications) as part of that rule. The result is consumers and those who would like to see us get the quality, individualized care we need are being put on the hook for payers’ greed.
Patient advocacy often has interesting bedfellows. And at the intersection of our care interests and that of industry, pharmaceutical manufacturers have found what can arguably described as a somewhat socialist model by way of patient assistance programs, often enacted as co-pay card or discount programs aimed at directly benefiting patients by taking care of the patients’ share of a medication’s cost. These programs are quite frequently limited by income or if a person is insured. The idea being to make sure the most costly medications make their way into the hands of the people who need them most and can least afford them. In this, our interests as patients absolutely converge with that of manufacturers. We want quality therapies made available to us. However, when a medication “goes generic”, often these programs are no longer available as a less costly, generic medication is preferred by the payer unless a patient fails that particular medication (see: step therapy, “fail-first”). The problem is generic medications are not held to extraordinarily strict requirements for Food and Drug Administration (FDA) approval that brand name medications are held to. Indeed, earlier this year, Vice offered a fantastic explanation of the problem with preferencing generic medications by payers (both public and private) is harmful to patients and why our generics “approval” process is a threat to the health and safety of patients. It’s no wonder, with the lax oversight of generic medications and the offer of payment assistance from manufacturers that patients would want access brand name and newer medications on the market.
One of the most amazing benefits of patient assistance programs is, in theory, because they’re meant to cover the patient’s cost-sharing obligations, these out-of-pocket (OOP) costs should apply to the patient’s deductible and OOP maximums and reduce the cost burden to patients for future care throughout the plan year. Right?
Wrong.
Payers have near uniformly adopted a practice known as “accumulator adjustment programs”, or co-pay accumulators, in which a payer basically says to a patient and a manufacturer “all for me, none for thee”, taking the entirety of the benefit offered by a patient assistance program and not crediting the patient with those funds received against the patient’s deductible, co-pay or co-insurance, or out-of-pocket maximums. To boot, manufacturers have zero control over this practice and often don’t know when it’s happening until a patient complains about the experience. Payers justify this move as “cost-containment” and disincentivizing patients from seeking more costly medications – which translates to newer, more effective, safer medications (go back to the problem with generic approvals above).
So far, the Centers for Medicare and Medicaid Services (CMS), the primary authority in which payment rules are issued from the federal government to payers, have generally made extraordinary effort to ensure protect the interests of patients and those who align with our interest. In the instance of CMS’s newest rebate rule, CMS chose to side with payers for some inexplicable reason. The rule states pharmaceutical manufacturers, not payers, would have to count these direct-to-consumer assistance programs among “best price” calculations, which govern Medicaid rebate price setting or what the government pays for a medication, if a patient didn’t receive 100% of the benefit of the assistance program. Previous rules on what to consider in calculating “best price” were generally limited to prices negotiated within industry movers inside the supply chain, not that of end users. The theory goes like this: “if ultimately this assistance program is paying an insurer’s bottom line and not helping patients, then it should be considered a price you (manufacturers’) negotiated. You were planning for that in setting your prices anyways, right?” Pop quiz answer: wonky negotiations with payers is not what manufacturers were planning on in designing income limited, only-accessible-by-consumers-asking for-it assistance programs. The solution CMS offered was for manufacturers to ensure patients received the intended benefit by requiring patients to pay for a medication up front and then ask for reimbursement – a process that only makes medication access and affordability infinitely more complicated and burdensome for patients.
In the end, CMS decided that in response to an excessively abusive payer practice that disadvantages patients, the answer was to create further barriers to accessing care for patients rather than to reduce them.
Let’s make this real and “back of the envelope” this practice in terms of realized patient experiences:
Monthly Income: $2,583 (based on average US income in 2019 provided by the Census Bureau)
Monthly premium: $304 (lowest cost local silver deductible is $3,400, OOP maximum is $8550, co-insurance is 20-40%)
Absent a public payer intervention, co-pay accumulators might allow a patient assistance program to cover the estimated $600 per month co-insurance would demand for a certain medication, however, I’m not likely to meet my deductible or maximum OOP for the year at all. With local rent costing about $1000 per month, a car payment and car insurance in order to work (there’s no meaningful public transit in the vast majority of the country), food costs, utilities, etc. Even with federal subsidies provided via the health care market place, every month, I’m in the negative. Which means I can’t afford to see my doctor or get my quarterly labs, which means I can’t get my medication in the first place.
However, without the application of a co-pay accumulator, accessing just 3 month’s worth of a patient assistance program would meet my deductible and maximum OOP costs for the year. I don’t have to worry about at least $200 per month in medical costs. And one less financial strain is off my shoulders.
For the vast majority of us, our medications are not a luxury item. They’re not something we can afford to pay for up front and mail-in a rebate request and wait months for. In doing so, CMS not only suggests an increase to the paperwork burden on patients and manufacturers alike, CMS also seeks to increase barriers to accessing life saving medications to begin with.
All to the benefit (read: profit) of payers. So it’s no wonder the trade organizations, Pharmaceutical Research & Manufacturers of America (PhRMA) chose to initiate a lawsuit to halt the implementation of CMS’s backwards and punitive rule.
While patient advocates may spar readily about the role of industry among advocates, we should also recognize actions that align with our own interests on their face. Yes, PhRMA may be leading up this suit - and CMS should listen to the needs of patients, reverse course, and voluntarily pull this rule.