Health Insurance can now help some Californians find housing

Thanks to an experimental new program aimed at easing the state’s profound homelessness crisis, some Californians now can get housing help from an unlikely source: their health insurance plans.

With the launch this year of CalAIM, California is reimagining medical coverage by marrying healthcare and housing statewide for the first time. Under the new approach, certain high-risk and low-income Medi-Cal recipients can use their insurance plans for more than doctor’s visits and hospital stays — they can get help finding affordable or subsidized housing, cash for housing deposits, help preventing an eviction and more.

Proponents say the program

acknowledges what doctors and social workers have known for years — it’s incredibly difficult to keep people healthy if they’re living on the streets or at risk of losing their home.

“There is no medicine as powerful as housing,” said Dr. Margot Kushel, professor of medicine and director of the UCSF Center for Vulnerable Populations. “And the health care system spends endless money and achieves poor outcomes because people don’t have access to housing.”

The program targeting Medi-Cal — California’s version of the federal Medicaid system that provides health insurance to low-income Americans — could be particularly powerful in the Bay Area, where more than 30,000 people lack housing. Many of those people are sick. In both Alameda and Santa Clara counties, about a quarter of unhoused residents report chronic health problems.

But CalAIM is limited in scope. It applies only to Medi-Cal’s most vulnerable patients — people who are homeless, leaving jail or prison, have a serious mental illness, and/or are frequently in and out of hospital emergency rooms, psychiatric wards and other institutions — leaving some experts worried that people who could use housing help will fall through the cracks. And while CalAIM can help participants find housing and give them limited cash for security deposits and first and last month’s rent, federal law prohibits the program from paying their rent on an ongoing basis. Nor can it conjure more housing in a state with a dire shortage of affordable options.

“It’s the hole in the middle of the donut,” said Dr. Kathleen Clanon, director of the Alameda County Health Care Services Agency.

Early pilot programs testing the CalAIM model showed that while patients visited the emergency room less often, most homeless participants did not secure housing.

There are 14 new benefits that insurance plans can offer patients under CalAIM, ranging from housing services and assistance securing healthy food to help removing mold and other asthma triggers from their home. Insurance plans pick which options to offer, with the goal of eventually scaling up to all 14. The program is expected to cost about $1.5 billion per year over the next two years.

Gov. Gavin Newsom has thrown his support behind the initiative, which started Jan. 1, as a key piece in his plan to reduce homelessness. The governor has poured billions into efforts to clean up encampments and create homeless housing, and wants to tackle mental illness by launching a new “CARE Court” program that could place some unhoused, untreated people in court-ordered care.

But it’s unclear how many people CalAIM can house. Alameda County’s Whole Person Care pilot — a precursor to CalAIM that ran from 2016 through 2021 — served about 30,000 people, two-thirds of whom were homeless. Of those homeless participants, 69% received some sort of roof over their heads, including emergency shelter beds and temporary hotel rooms. Just 36% ended up with permanent housing.

“I wish it were higher,” said Clanon, the county’s medical director. Even so, she called 36% a success. Prior to the pilot program, just 10% of unhoused people in the county’s homeless services system received permanent housing each year, she said.

In Santa Clara County, a similar pilot program called Health Homes was run by the county’s Medi-Cal insurance plans. In the first half of last year, Santa Clara Family Health Plan saw a 25% drop in emergency room visits and a 30% drop in longer hospital stays for its pilot patients. A total of 211 homeless patients enrolled in the program between 2019 and 2021, and 54 received housing services and were subsequently housed.

“It’s very challenging to find housing even when you have a robust housing navigation program,” said Lori Anderson, director of long-term services and supports for Santa Clara Family Health Plan.

Results were similar statewide. Of participants who were homeless or at risk of homelessness in the third quarter of 2020, 68% received housing services, but just 7% were housed, according to a recent report on Health Homes pilots in 12 California counties.

For Janice Anderson, 55, CalAIM already has been a success. Anderson left her partner last year in part because she said he enabled the drug addiction she was trying to conquer. But that also meant leaving the Livermore apartment they shared.

Anderson slept in her car briefly before moving into a temporary shelter in an Oakland motel. As a Medi-Cal patient, Anderson was eligible for CalAIM. Case workers called her regularly to walk through the steps to get into housing — from cleaning up her credit to attending housing fairs to filling out rental applications.

When she found a one-bedroom apartment in Hayward, the program paid her first and last month’s rent, and helped her secure a federal emergency housing voucher that reduced her rent to $960 a month.

Anderson moved in this month, and the first thing she did was hang string lights on her front porch. She wants to turn her balcony into a “Zen area” where she can drink tea and meditate before reporting to her job as a peer advocate for HIV-positive women.

“It’s just nice to know that if you ask for help, and you find the help, and you put in the work, life is good,” she said. “It’s amazing.”