Colorado just became the most recent state to apply for a federal waiver to use its Medicaid program to address homelessness and housing insecurity. Earlier this month, the State filed a 1115 Demonstration Waiver asking to expand Medicaid coverage for a wide range of housing services—housing transition navigation services, utility costs for up to 6 months, one-time moving costs, and rent/temporary housing for up to 6 months.
This is part of a growing trend following the changes in Centers for Medicare & Medicaid Services (CMS) rules that allow state Medicaid more flexibility in covering health-related social needs (HRSN) including housing. As of February 2024, there are eight states (i.e., Arizona, Arkansas, California, Massachusetts, New Jersey, New York, Oregon, and Washington) with approved Section 1115 Health-Related Social Needs (HRSN) Services Waivers.
In addition, last year, CMS began allowing Medicaid health plans to spend up to 5% of premiums on HRSNs. This includes housing, nutrition, and transportation services.
In California, state Medicaid housing initiatives are part of the State’s California Advancing and Innovating Medi-Cal (CalAIM) program. The program’s housing support includes aid for rent and deposits, recuperative housing, rehabilitation and sobering centers during the day and the provision of street medicine. And on March 5, 2024, California voters approved Proposition 1, which amended the Mental Health Services Act (MHSA) of 2004 to provide a $6.4 billion bond to build 4,350 housing units.
At this point, the link between housing and health care is clear. People who are housing insecure have medical expenditures over the twice the average. This explains the significant health plan investments in housing-related programs, most recently Centene pledged to help build nearly $1 billion of affordable housing. Similarly, CVS Health® invested $19.2 million to build new affordable housing units in Arvada, Colorado.