NYAPRS Note: In this excerpt from the NYS Department of Health’srationale for our Medicaid Waiver proposal to reinvest anticipated
federal savings into a number of key initiatives, DOH makes a powerful
case for the critical value of increased supportive housing beds towards
realizing improved healthcare system outcomes and savings.
DOH is proposing to reinvest $750 million over the next 5 years to
create housing and supports for 3000 ‘high cost high needs’ Medicaid
beneficiaries in need of stable housing.
Many NYAPRS members have sent letters of support to DOH/CMS in support
of the waiver’s emphasis on expanding housing, peer support, workforce
retraining and advancing cultural competence.
Medicaid Supportive Housing Expansion
Question #1: What are the core problems in health care delivery this
program plans to address? As part of this answer please describe the
“current state” the program will attempt to transform/improve.
New York State is plagued by a lack of supportive housing and as a
result Medicaid is wasting money. There is compelling evidence that for
people coping with chronic illness or disability and behavioral health
challenges, the lack of stable housing often results in avoidable health
care utilization and, in turn, avoidable Medicaid expenses. Moreover,
the lack of affordable housing, in combination with accessible health
care, continues to be an obstacle to serving individuals in the most
integrated setting. This includes individuals in nursing homes and other
long term care settings, who cannot be discharged because they lack a
place to live, as well as homeless individuals and those in shelters
whose chronic health and behavioral health conditions lead to overuse of
emergency departments and hospital inpatient care. Transitioning
individuals into supportive housing dramatically reduces immediate and
long-term spending for Medicaid reimbursable expenses, as well as
spending on other public programs. By increasing the availability of
supportive housing for high-need Medicaid beneficiaries, there is
significant opportunity to reduce Medicaid costs and improve the quality
of care for these individuals.
Question #2: How will this program help achieve the Triple Aim in New
York? Access to supportive housing services is of paramount importance
to achieve the Triple Aim of better health, better care, and lower costs
for traditionally underserved populations.
Better Health, Better Care
There is a growing national recognition that addressing the social
determinants of health is critical for improving health while reducing
health care costs. This is most evident in the matter of housing. People
who are homeless or lack stable housing face multiple health risks, die
younger, have less access to primary care, and are frequent users of
expensive hospital services. Among those New York City Medicaid patients
at highest risk for future costly hospital admissions, as predicted by a
validated algorithm, a full 60 percent were homeless or precariously
housed.
Additional supportive housing services will also reduce health
disparities by focusing on a diverse population of low-income New
Yorkers. Racial minorities, including African-Americans, Hispanics, and
Native Americans are overrepresented among those who are homeless and
marginally housed, and stand to benefit the most from supportive housing
services. In addition, focusing on the Health Home eligible population
will have the ancillary benefit of contributing to reducing health
disparities among the minority community.
For example, of the Health Home eligible population, over 20 percent are
African-American and over 26 percent are Hispanic. Increased funding for
supportive housing services for the racial and ethnic minority
population will contribute to the state’s efforts at reducing health
care disparities.
Lower Costs
The lack of appropriate supportive housing, especially in New York’s
urban areas, is a major driver of unnecessary Medicaid spending. For
every individual served under this program, it is estimated to save
Medicaid costs by approximately $16,281 – $31,291 annually per person14,
with savings ranging by the types of populations and disabilities served
and intensity of targeting. Preliminary estimates suggest that Medicaid
savings would total between $142 million – $273 million annually,
totaling between $711 million – $1.3 billion over a five-year period.
Over a decade of independent research has shown that transitioning
individuals into supportive housing dramatically reduces immediate and
long-term spending for Medicaid reimbursable expenses, as well as
spending on other public programs. This is a fundamental premise of the
U.S. Department of Justice’s vigorous enforcement activities to assure
the availability of community living options for people with
disabilities. In New York, supportive housing costs $47 per day while it
costs $437 a day in a psychiatric hospital, $755 in an inpatient
hospital, $68 in a homeless shelter, and $129 for jail.2 By increasing
the availability of supportive housing for high-need Medicaid
beneficiaries, there is a significant opportunity to reduce Medicaid
costs and improve the quality of care for these individuals.
A preliminary analysis of 28,724 recipients in need of supportive
housing found a total of over $1 billion in annual Medicaid
expenditures, including $212 million on inpatient hospital care, $5
million on emergency department services and $266 million on long term
care services.3 Supportive housing services have the potential to
decrease these costs dramatically – producing millions in Medicaid
savings.
For example, multiple national studies have found reductions in
emergency department (ED) and inpatient costs averaging 60 percent,
potentially saving New York’s Medicaid program over $650 million over
five years in ED and inpatient costs alone. Clearly, expanding the
availability of supportive needs is an integral component to attaining
Medicaid cost containment.
Question #3: What will the state’s health care delivery system look like
after this program is implemented (post waiver period)? Provide the
vision for the future with specific examples (i.e. Brooklyn will have a
stable health care delivery system which provides high quality service
for the first time in decades).
After the completion of this project, New York will have a more secure
foundation to house its high cost Medicaid populations. Specifically,
individuals that receive supportive housing services through this
program will receive comprehensive “support services”, and a permanent
place to live. By increasing the availability of supportive housing for
high-need Medicaid beneficiaries, New York will experience a significant
reduction in Medicaid costs and vast improvement in the quality of care
for these individuals.
Question #4: How will the state ensure that the goals of the program are
achieved? Specifically, what consequences will exist for providers that
receive funds and fail to achieve agreed upon benchmarks/metrics?
New York’s Supportive Housing program will monitor placement to assure
that only eligible individuals, as outlined on page 60 of our MRT
document, receive supportive housing services through this program. New
York State and New York City have extensive experience in managing a
gate keeping function to assure that priority populations are placed in
supported housing units. The State and City, going back to 1990, have
implemented a series of New York/New York agreements targeted to the
shelter and street homeless population. The NYC Human Resource
Administration reviews each request for housing and certifies that the
individual meets the target population criteria prior to placement. In
2005, under the NY/NY III agreement, this gate keeping function was
strengthened to target long stay shelter and street homeless. The NYS
waiver proposal will use a similar gate keeping function; in this case
the admission criteria would be high cost Medicaid users. Medicaid
claims and encounter data would be used to review the referral. For NYC,
the state would work cooperatively with NYC government, Health Homes and
managed care plans to manage this function.
Outside of NYC the state could manage the gate keeping directly in
cooperation with Health Homes and managed care plans. Local government
could choose to participate in the process. The initial target group for
health home enrollment is high Medicaid users, so this will be a natural
pool to generate referrals. The health home will be responsible for
developing and overseeing the integrated plan of care for treatment and
support.
Question #5: How will funds “flow” to approved projects? Describe the
application process as well as what plans currently exist for how funds
will be distributed throughout the waiver period. New York seeks to
dedicate $150 million annually, totaling $750 million over five years,
to expand access to supportive housing services. Under this proposal,
two programs would be created – the Supportive Housing Capital Expansion
Program, totaling $75 million annually, to fund capital projects, and
the Supportive Housing Services Program, totaling $75 million annually,
to provide supportive housing services.
Funds must target high cost, high need Medicaid members who require
supportive services to live independently. Funds would be distributed
through a variety of state and local housing agencies via a competitive
request for proposal approach. Funds would be distributed to eligible
applicants on a competitive Request for Proposal (RFP) process.
Sustainable projects, with the greatest Medicaid return-on-investment
(ROI), would be prioritized over other projects. Eligible applicants may
include, but are not limited to, for profit and non-profit housing
developers, and private nonprofit organizations. New York State agency
partners may include: the Office of Mental Health (OMH), the Office of
Temporary and Disability Assistance (OTDA), the AIDS Institute within
the Department of Health, the New York State Office of Alcoholism and
Substance Abuse Services (OASAS), and New York State Homes and Community
Renewal (HCR).
Question #6: Why are these funds necessary? Why can’t the state fund
these efforts with other state or federal funds? Describe how waiver
funds for this program will relate to other federal funding
opportunities.
This proposal is one component of New York’s greater commitment to
support Supportive Housing. Currently, multiple agencies throughout the
state fund supportive housing programs. New York State has invested more
than $350 million annually in these efforts because the program works –
it improves quality care and lowers health care costs. Despite New
York’s commitment, we continue to experience need whereby thousands of
New Yorkers lack housing and supportive services. As a result, these
individuals continue to be homeless or live in institutions or other
inappropriate settings because of the lack of affordable, accessible
housing options in the community.
http://www.health.ny.gov/health_care/medicaid/redesign/docs/waiver_quest
ions.pdf