Homeless people in Hawaii who are enrolled in Med-QUEST, the state’s Medicaid program, will have access to housing support services starting Jan. 1 that were previously offered to only a handful.

Medicaid dollars can’t pay for rent, but under a waiver granted to the state by the federal government in October, Med-QUEST plans will cover the cost for caseworkers who do the legwork of getting people into housing and keeping them housed.

It’s the “supportive” part of “permanent supportive housing” programs and typically involves getting paperwork and identification together, convincing landlords to accept a homeless tenant, and helping newly housed people access resources so they don’t fall back into homelessness.

“A lot of the outreach and case management services that right now get paid out of state or city general fund dollars could be paid for through the Medicaid health plans,” said Scott Morishige, the state’s homeless coordinator. “It’s a pretty groundbreaking thing that only a small number of states have.”

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At least eight other states have requested waivers from the federal Centers for Medicare & Medicaid Services that would loosen restrictions on Medicaid spending, allowing them to use Medicaid funds for housing support, according to the Corporation for Supportive Housing.

State and city funds freed up through the waiver can be used to build housing or offer rental assistance to more people, Morishige said.

Med-QUEST has offered tenant support services through a 1115 waiver granted to the state in 1994, but only people who were diagnosed with mental illness and unable to perform daily activities, like bathing or feeding themselves, were eligible.

Med-QUEST administrator Dr. Judy Mohr Peterson called it a “pretty high bar” to qualify, and said a few hundred people were able to access the services over the course of four years.

Peterson worked to amend the waiver so that more people would qualify.

Now, the service is available to people who are homeless or at risk of being homeless and who also have a mental illness, chronic health problem or substance use disorder.

“Before we had a more narrow set of services for a very narrow population, but this expanded it to a much broader and more meaningful population,” Peterson said.

The new service, Peterson said, is meant to target the estimated 1,714 people in Hawaii who meet the U.S. Department of Housing and Urban Development’s definition of “chronically homeless,” meaning they have a disability, chronic illness, serious mental illness or substance abuse disorder and have been homeless for a certain amount of time.

The majority of this population is also eligible for Medicaid, Peterson said.

In 2019, Peterson estimates Medicaid can serve 10 percent of Hawaii’s chronically homeless population but as health care providers and social service agencies collaborate to make the service more accessible, she hopes within three to five years the entire population can get housing support through Medicaid.

“I’m looking forward to a time where we consider housing a form of health care.” – Lt. Gov. Josh Green

The waiver might also help nonprofits save money.

The Institute for Human Services and other social service nonprofits offer tenancy support through various programs they operate under state and city contracts. The administrative budgets of those contracts, which pay for the salaries of housing specialists, seem to be decreasing every year, said Kimo Carvalho, community relations director at IHS. The nonprofit relies on money from private donors to supplement contracts and the Medicaid funding will now offer another source of funds.

Carvalho also said getting people into housing and keeping them housed can ultimately reduce Medicaid expenses

Living on the streets exacerbates chronic diseases such as hypertension, asthma, diabetes and mental illnesses, according to the National Health Care for the Homeless Council.

Heath care costs drop once people are housed, said Hawaii Lt. Gov. Josh Green, an emergency room doctor. Some homeless people also frequent emergency rooms to manage their health problems, which is more costly than preventative care.

Gary Grinker, a homeless man who received services through IHS, went to the hospital 241 times in 2017, making him the most frequent user of the emergency room at Queen’s Medical Center and costing Medicaid $1.2 million that year, according to Carvalho.

“He was using the emergency room as a place to take care of basic health needs,” Carvalho said.

Green said the waiver is a step in the right direction.

In 2017, Green, then a state senator, introduced a bill that would classify chronic homelessness as a medical condition. Insurance companies would need to pay for the treatment, and Green envisioned the state’s Medicaid budget paying for housing.

“I’m looking forward to a time where we consider housing a form of health care,” Green said. “Our concept of what is needed for a safety net has to also evolve.”