States will soon begin paying for housing residents using federal health care funds in hopes they will help curb the homeless epidemic in the United States, which has reached a record level.
The Biden administration has granted permission to several states to implement a new Medicaid waiver program that will allow states to pay housing fees as advocates seek to classify homelessness as a health care issue.
Medicaid is the US government program that provides health insurance to adults and children with limited income and resources.
The latest data from October 2023 reported that approximately 80.3 million Americans were enrolled in the program.
Rental assistance will come in several forms, including a one-time payment to help a person put down a security deposit for housing or cover rent and utilities for up to six months.
A view of a homeless encampment on a street in West Oakland, California. The state has the largest homeless population in the US.
The first two states to implement the program, Arizona and Oregon, will target specific subpopulations of Medicaid beneficiaries who qualify based on each state’s specific guidelines, including people currently homeless or at risk of losing their housing and people with mental illness .
The waiver was approved at a time when the homelessness crisis in the United States is at its peak and rents are skyrocketing, leaving hundreds of thousands of Americans living on the streets.
Proponents of the change argue that homelessness is a public health problem, putting pressure on the health system and costing millions of dollars a year, so states should be allowed to use federal funds to help provide provide people with stable housing.
The policy change is being implemented through a program that allows states to experiment with new ways to use Medicaid money.
Before the change, congressional restrictions only allowed funds to be used for nursing home or medical facility payments, but in recent years states have been taking steps to use Medicaid money for broader public health measures, including housing assistance.
Arizona and Oregon will pilot the initiative with a certain subset of people with Medicaid starting in October and November, respectively.
Arizona has 14,200 homeless residents and Oregon has 20,100 homeless residents.
Oregon, which has 1.5 million people on Medicaid, plans to use the funds to help beneficiaries at risk of homelessness in an effort to prevent homelessness.
Currently, about 125,000 Medicaid beneficiaries qualify for the program. They could also include people experiencing a behavioral health crisis, people hospitalized with a long-term health problem, or pregnant women in need of resources.
Assistance will include a one-time payment to help with a security deposit or cover rent and utilities for up to six months.
The state plans to use $1 billion of its Medicaid budget to prevent homelessness through multiple measures and programs, including rental assistance.
Arizona, which has 2.5 million people enrolled in Medicaid, will target people classified as seriously mentally ill to subsidize rent and, because it lacks affordable housing supply, will use Medicaid funds to pay for “shelters.” improved”, which consist of collective housing.
Others who will qualify include those who are at risk of or currently facing homelessness and those who are on an approved community housing waiting list.
Arizona is allocating $550 million for the program.
The state approved covering up to six months of housing for people. Those eligible for rental assistance will receive a voucher to rent a home. If a person has no income, the voucher will cover 100 percent of the rent.
If they have income, the bond will cover 70 percent and the resident will be responsible for 30 percent of the rent.
New York, California, Hawaii and Washington have also applied to participate in the program.
California and New York have the two largest homeless populations in the country.
The number of homeless Americans has been increasing since 2017 and reached a record high in 2023.
The above shows a breakdown of the homeless situation in the US.
The number of homeless Americans has increased since 2017 and reached an all-time high in 2023, and rental prices have reached their most unaffordable levels.
According to a report According to the U.S. Department of Housing and Urban Development, 653,100 people were without permanent housing in 2023, up from 582,400 people in 2022, an increase of 12 percent.
The report blames rising rental prices and a worsening housing affordability crisis, with a shortage of affordable homes available.
Dan Tsai, deputy administrator and director of the Center for Medicaid and CHIP Services, said Vox, the new Medicaid waiver program, was based on both common sense and evidence-based research.
He said: ‘We think it’s incredibly exciting. This is a strong and clear position, and we spent about a year of this administration working on how to define and buffer Medicaid’s role in housing and nutrition.’
Before the change, congressional restrictions only allowed Medicaid funds to be used for nursing home or medical facility payments.
However, research has found that homeless adults have three times as many hospital and emergency department visits as the general population and providing them with housing will save on those healthcare costs.
This isn’t the first time a state has allocated money to help house people in the name of health care.
In 2022, New York City invested $14 million in the Housing for Health program that helps homeless patients find affordable housing, “recognizing that the chronic health problems of homeless people cannot be treated without stable housing “.
In announcing the initiative, Mayor Eric Adams said: ‘It’s time to look at the full picture of New Yorkers’ health challenges and address them holistically.
‘It is not enough to treat homeless New Yorkers in the emergency room and then discharge them if they do not have a home to recover and heal.
“We know that housing is critical to health, and this program brings us one step closer to achieving a healthier, more equitable, and more prosperous New York City.”