Activists and state legislators are considering supportive housing — which combines affordable housing with wraparound social services — as a means of addressing Rhode Island’s homelessness crisis and reducing health care costs.
The “Rhode Island Pathways Project” bill presented in the state legislature and Rhode Island’s Pay for Success Permanent Supportive Housing Pilot Program — which will launch in April — are two programs that aim to include housing within the scope of health care.
‘Rhode Island Pathways’: Housing as a healthcare expenditure
The bill aims to address chronic homelessness by instructing Rhode Island’s Executive Office of Health and Human Services to “utilize any current Medicaid waiver funds to provide coverage for supportive housing for the chronically homeless population in the state” upon the bill’s passage. The conditions of the waiver “act as a contract that establishes the scope of the state’s flexibility under federal law relative to the Medicaid State Plan,” according to the EOHHS website.
The bill would also have EOHHS study “the impact of using Medicaid funds for the treatment of the chronically homeless.”
“The only way we’re going to do it is to try out-of-the-box things,” said State Rep. David Bennett, D-Cranston, Warwick, the Pathways Project bill sponsor in the Rhode Island State House. “This bill is out-of-the-box.”
The bill has passed the Senate five times in the last six years but has failed to pass in the House. But according to State Sen. Joshua Miller, D-Cranston, Providence, the bill’s sponsor in the Senate, believes there is now “consensus” that the legislation will save money, and there now exists a precedent for the granting of the federal waiver.
According to Miller, the legislation saves the state money by keeping chronically unhoused people out of emergency healthcare situations, reducing Medicaid expenditures. A one-night stay in a Rhode Island emergency room can cost $1,750, potentially equivalent to a month’s rent or more, Miller explained. If someone is unhoused with a medical or behavioral condition, they may need to seek emergency care several times a month, he added.
Studies have found that housing the chronically unhoused who frequently use emergency rooms reduces their use by about 50%.
“The savings accumulate very quickly, averting those (emergency) runs by having them sheltered,” Miller said.
Miller said he originally learned about the idea from current Hawaii Gov. Josh Green at the National Council on State Legislatures conference. Green, a former emergency room doctor, was then a Hawaii state senator and had been working on a similar proposal for funding housing for unhoused people.
The idea of using Medicaid to address homelessness has gained traction in recent years. Arizona recently received approval from the federal government for a program which uses Medicaid dollars for supportive housing services, including up to six months of rent and temporary housing for those transitioning out of homelessness.
Similar programs exist in Arkansas and Hawaii, but in New York, a 2012 request to use federal dollars for supportive housing services was denied by Washington, D.C.
“We think there’s a better understanding, especially with other states doing the math on behalf of the same concept,” Miller said.
EOHHS has already begun to move forward with proposals similar to those advocated by Miller. A waiver submitted by McKee in December 2022 seeks to expand the usage of Medicaid dollars to more forms of transition-related support, including up to six months’ worth of rent payment.
“Rhode Island sees the ability to pay for six months of rent as a substantial change to the Home Stabilization benefit that will have a significant impact on beneficiary outcomes,” according to the waiver, with the extension would also expand eligibility for the services and “relax” requirements for service providers.
“Historically, most of the funding for housing service providers has come from either (the Department of Housing and Urban Development) or different grants, either federal or other nonprofit,” said Gretchen Bell, healthcare initiatives lead at the Rhode Island Coalition to End Homelessness. “Using this Medicaid funding stream will hopefully prove to be impactful and sustainable.”
Pay for Success: Another strategy for addressing homelessness
The legislation proposed by Miller and Bennett “is in line conceptually with projects that we’re already working on at the coalition,” such as the Pay for Success program, Bell explained.
Bell is working to launch the Pay for Success program, which aims to help those experiencing homelessness “successfully maintain permanent housing.” The pilot, co-led by the Coalition and EOHHS, will target 125 high utilizers of Medicaid, Department of Corrections and homelessness services, Bell explained.
Under the Pay for Success model, funding for housing is provided by the private sector. The program is then evaluated by a third party based on established benchmarks — if they are met, public funding is made available to pay back the investment plus “a modest return,” Bell said.
“We’re hoping to see a shift in (the) health care utilization of that population,” Bell said. Like Miller and Bennett’s bill, the program aims to have unhoused people use more “preventative services” like primary care providers, dentists and mental health care instead of emergency room visits, Bell added.
The initiative is Rhode Island’s first Pay for Success project on permanent supportive housing, according to Bell.
The General Assembly allotted $6 million was allotted for the pilot program in the 2022 fiscal year budget, according to the Coalition.
But much remains unclear for the program, which Bell said was originally supposed to launch in January and now is set to begin in April. The private investment, program benchmarks and data use agreements with Medicaid and the Department of Corrections still need to be finalized, Bell said. The data use agreements are necessary in order to “pull those high utilizers to make” the eligibility list, she added.
The pilot also has to work within the confines of the current housing market.
“The biggest challenge will be the lack of housing,” Bell said. “There’s not a set-aside (portion) of affordable housing that comes with that state appropriation.”
Bell hopes that the Pay for Success initiative and Miller’s bill will “provide a lot of data” on how to best serve those in need of housing support services and “how to creatively and strategically use different funding streams” to do so.
Jacob Smollen is a Metro editor covering city and state politics and co-editor of the Bruno Brief. He is a sophomore from Philadelphia studying International and Public Affairs.