Supportive housing is defined as “a combination of affordable housing and supportive services designed to help vulnerable individuals and families use stable housing as a platform for health, recovery and personal growth.” Individuals eligible for supportive housing are typically those who lack housing or who face a multitude of co-occurring, complex medical, mental health and/or substance use issues.
Supportive housing is associated with promising health outcomes, and decreased health care costs. According to one study, placement in supportive housing has resulted in a 14.3% reduction in emergency department visits and a 25.2% reduction in associated spending.
5 Things to Know About Supportive Housing
Supportive housing is affordable (less than 30% of tenant income), provides a lease or sublease identical to non-supportive housing, includes no limits on the length of tenancy, and engages members in supportive services.
Core components of supportive housing include keeping tenants housed, improving physical and mental health, increasing income and employment, ensuring satisfaction with services and housing, and fostering social and community connections.
Services most commonly provided through supportive housing include case management, medical treatment, behavioral health treatment, peer support and life skills training.
Research on supportive housing suggests short-term health care cost savings, reduced utilization of emergency health services, and decreased psychiatric inpatient events and behavioral health hospitalizations.
Many supportive housing programs follow a Housing First approach to connect individuals and families experiencing homelessness to permanent housing. The approach reduces barriers to entry and preconditions such as sobriety, treatment or service participation requirements.
5 Funding Mechanisms States May Consider for Supportive Housing Programs
Supportive housing programs are financed through a variety of local, state and federal sources. While federal Medicaid dollars cannot pay for housing, some states have leveraged Medicaid programs, as well as other funding sources. States may explore any of the following strategies concurrently.
Utilize Medicaid 1115 and 1915(c) waivers to leverage federal matching funds for services to individuals experiencing homelessness or currently living in permanent supportive housing.
- Louisiana’s 1915(c) home and community based services waiver adds housing stabilization transition services for participants who are transitioning to a supportive housing unit.
- Maryland’s 1115 waiver established a pilot program for high-utilizing Medicaid enrollees at risk of institutional placement or homelessness post-release from emergency shelters, health facilities, foster care or correction institutions.
Utilize 1915(i) Medicaid authority to modify state Medicaid plans to include supportive housing in home and community based services.
Require managed care organizations (MCOs) to provide care management or service coordination to Medicaid beneficiaries. Thirty-three states contract with MCOs to address social drivers of health through screening, referrals, community health workers and community reinvestment.
- North Carolina is piloting Medicaid payment for services in four domains—food, housing, transportation and interpersonal violence and toxic stress—through a Section 1115 waiver beginning in 2021.
Leverage federal American Rescue Plan Act funding. More than half of states and territories allocated funding for housing and homelessness.
- Missouri HB 3020 (2022) appropriated $600,000 for transitional living and supportive housing for individuals in recovery from alcohol and drugs.
- Virginia HB 7001 (2021) allocated $5 million for permanent supportive housing in Northern Virginia to assist with the bed crisis at state facilities.
Direct opioid settlement dollars toward opioid prevention and treatment. At least 16 states allocated settlement dollars for opioid abatement, including supportive or recovery housing.
- Kentucky HB 427 (enacted 2021) established the Opioid Abatement Fund to reimburse for a variety of services, including supportive or recovery housing.