Affordable Housing Reduces Medicaid Costs, New Report Shows
Primary care visits increased, emergency department visits decreased while integrated health services were a key driver of improved health care access and quality
PORTLAND, Ore. – February 25, 2016 – A study released today shows that affordable housing paired with health care services significantly increases access to primary care and reduces emergency department visits while lowering Medicaid costs, according to research from Center for Outcomes Research and Education (CORE) and Enterprise Community Partners Inc. (Enterprise). Health in Housing: Exploring the Intersection between Housing and Health Care analyzed Medicaid claims data from January 2011 to June 2015 for more than 1,600 residents in 145 affordable housing properties in Portland. The study found that after moving into affordable housing, Medicaid costs were $48 lower per resident per month, for an annualized reduction of $936,000 for the study group.
The Enterprise/CORE study is one of the most comprehensive looks at how health care and affordable housing intersect. This report is one of the first studies examining health care in affordable housing using multiple populations: families with children, individuals living in supportive housing, and older adults and residents with disabilities.
The Health in Housing report found:
- Total Medicaid expenditures declined by 12 percent, with the greatest savings among seniors and people with disabilities at 16 percent
- Outpatient primary care use increased 20 percent while emergency department use fell by 18 percent
- Residents reported improved access to health services and quality of care, with about 40 percent saying it was better after move-in
- Housing with integrated health services was a key driver of health care outcomes, suggesting that increasing these services may result in even greater cost savings
"The Health in Housing study holds national implications for health care systems, payers and policy makers looking for upstream solutions to address major health care needs and fulfill reform goals," said Dr. Megan Sandel, associate professor of pediatrics at Boston University School of Medicine and a member of Enterprise’s board of trustees. "Housing with integrated health services is an important solution toward bending the health care cost curve."
The Health in Housing report indicates that the presence of health services and staff is a significant driver of reductions in health care expenditures and emergency department usage. As many state Medicaid programs are serving new populations following a 2014 expansion of the program, these states have begun looking at ways to provide better care while managing costs.
"Health reform has increasingly called upon health care systems to recognize the importance of upstream factors that drive health outcomes and affect health care costs. Our research shows that affordable housing is one of those key factors," said Bill Wright, Ph.D., director of CORE and lead researcher on the study. "We live in a profoundly interconnected world, and we may be moving past the time when any sector can go it alone."
CORE partnered with Health Share of Oregon, a local Medicaid coordinated care organization (CCO), to access a comprehensive Medicaid claims database to assess utilization and costs related to physical, behavioral health and dental claims. This database was then matched to 145 affordable housing properties in and near Portland.
"The report provides invaluable insights on how we can work with new partners and advance programs that fulfill the promise of accountable care," noted Janet L. Meyer, CEO, Health Share of Oregon. “Stable, affordable housing provides the foundation to provide readily accessible, patient-focused health care.”
The research has informed Enterprise’s recently released housing policy platform and additional work in the field. “Based on the findings of the study, especially those that quantitatively show that affordable housing drives down Medicaid costs and improves health care outcomes, Enterprise strongly advocates for policy and funding changes at the state and federal level that will increase Medicaid investments in affordable housing through capital, rental assistance and service coordination,” said Amanda Saul, senior program director, Enterprise.
The findings also serve as the foundation for a pilot underway in Portland, Oregon, that will demonstrate positive outcomes associated with using Medicaid dollars for housing. This Enterprise-led pilot will test Medicaid Flexible Services funding for rental assistance, eviction prevention, rapid re-housing, transportation and service coordination for people experiencing a health and housing crisis.
Health in Housing was made possible through a grant from the Meyer Memorial Trust. Meyer has also provided support to Enterprise’s Medicaid Flexible Services pilot.
Enterprise’s generational goal is to end housing insecurity in the U.S., which means no more homelessness and no more families paying more than half of their income on housing. As a down payment toward that goal, by 2020 Enterprise will help provide opportunity to 1 million low-income families through quality affordable housing and connections to jobs, good schools, transit and health care.
The Center for Outcomes Research and Education is an independent research hub based in Portland, Oregon. They work on research projects to improve health system transformation and population health, particularly for Medicaid beneficiaries and low-income people. CORE partners with health systems, state agencies, and community groups to help them meet the triple aim of better health, better care and lower costs. Recent work includes quantifying how adverse life events impact health outcomes, and using cutting-edge data science to examine the intersection of health care with services such as housing, education, and corrections.