Earlier this month, New York state announced the development of a housing project financed under a program based on the argument that stable housing combined with other social services can reduce costly visits to the emergency room and hospitalizations, Apartment Finance Today
That argument is at the center of an ongoing debate in New York about whether housing should be considered healthcare, NPR reported
Bruce Vladeck, who led the Centers for Medicaid and Medicare Services during the Clinton administration, told NPR that Medicaid funding should be dedicated to providing healthcare, not housing.
"Medicaid is supposed to be health insurance, and not every problem somebody has is a healthcare problem," said Vladeck.
Dr. Niray Shah, the former New York State commissioner of health, argued that there is a link in a December 2013 article published in The New England Journal of Medicine.
Shah said that Medicaid funds should be used to help defray the costs to provide housing to the chronically homeless because it would result in healthcare savings.
"Placing people who are homeless in supportive housing — affordable housing paired with supportive services, such as on-site case management and referrals to community-based services — can lead to improved health, reduced hospital use, and decreased healthcare costs, especially when frequent users of health services are targeted. These benefits add to the undeniable human benefit of moving people from homelessness into housing," he wrote.
Furthermore, Shah said the program was one of the more "innovative solutions" to the nationwide problem of "runaway" Medicaid costs.
In 2011, incoming Gov. Andrew Cuomo created the Medicaid Redesign Team (MRT) Housing Capital Program to ensure that supportive housing
was a key component in the state's efforts to provide cost-effective healthcare to individuals struggling with homelessness.
According to NPR, New York now has about 47,000 supportive housing units, and the state intends to invest $260 million Medicaid dollars over the next two years.
The federal government, however, will not match those funds because Medicaid rules do not currently allow capital funding for supportive housing.
According to the MRT, New York state has submitted an application for a Medicaid waiver from the federal government that includes a program to earmark $150 million annually to expand access to supportive housing.
While Shah argued the program would rein in "runaway costs" in the Medicaid program.
New York's program has received intense scrutiny from federal and congressional investigators. In March 2013, the House Committee on Oversight and Government Reform
issued a report showing that more than $15 billion in Medicaid overpayments were made to the state’s centers for developmentally disabled people at reimbursement rates 5 to 10 times higher than cost in the last two decades.
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