How Medicaid Can Address Youth Homelessness, Behavioral Health

May 11, 2022 - Medicaid can help reduce youth homelessness among individuals with behavioral health needs by expanding coverage, incentivizing cross-agency coordination, and increasing plan oversight and accountability, according to an analysis developed by Manatt Health for the Raikes Foundation.

Children 16 years old and younger and young adults between 17 and 24 years who are leaving a public system of care such as foster care or a residential behavioral health facility are at increased risk of becoming homeless.

This risk is heightened due to several factors, including a lack of access to the continuum of care, lack of available and affordable housing, cross-system fragmentation, youth being discharged to the streets from inpatient or residential treatment, and inconsistent oversight of behavioral health policies.

States have the power to help address youth homelessness through their Medicaid programs.

According to Manatt Health’s analysis, states can leverage Medicaid by implementing strategies such as expanding coverage and access to the full continuum of services, reframing the approach to residential and inpatient treatment, and preventing facilities from discharging individuals to homelessness.

Additionally, states can adjust policies to support families of youth who are at risk of treatment, drive alignment and cross-agency coordination, and increase oversight and accountability for Medicaid plans.

Expanding the continuum of care for youth requires providing peer support, crisis services, and in-home services, the report stated.

States should expand Medicaid support to cover services that help youth find and stay in housing. Permanent supportive housing with behavioral health services can help assist those who can live independently, while other residential supports can provide personal assistance to help those who cannot live on their own.

States can also combine Medicaid funding with other federal programs to expand affordable housing options for youth with behavioral health needs. Federal programs can help coordinate foster care placements for youth or subsidize rent to ensure it is affordable for young adults.

Medicaid programs should cover education and employment supports, which can help youth develop the necessary skills to support themselves financially and maintain access to housing.

In addition, ensuring young adults have access to an adequate crisis system can help reduce avoidable emergency department visits, hospitalizations, incarceration, and homelessness.

Driving alignment and cross-agency coordination can help reduce youth homelessness as youth with behavioral health needs often interact with multiple agencies. Without clear communication and data-sharing across these agencies, youth behavioral health needs may go unmet, the report said.

States can help further cross-agency coordination by creating workgroups that involve Medicaid managed care plans and meet regularly. A systems of care model may also help improve coordination by building partnerships across agencies, Medicaid plans, and providers to meet youths’ needs better.

Improving data collection and analysis across state agencies can also establish a complete picture of youths and their behavioral health needs, according to the report.

Finally, states should enhance oversight and accountability to ensure that behavioral healthcare providers and managed care organizations (MCOs) comply with requirements that benefit young people.

For example, state leaders can create measures that providers and MCOs must meet, such as approval and denial rates for behavioral health treatments, length of service treatment authorization, post-discharge service referrals, and youth and family satisfaction surveys.

States should also establish reporting requirements and review provider and MCO compliance with the measures.

Creating incentive programs and imposing sanctions such as financial penalties or exclusion from Medicaid programs may also help providers and MCOs maintain compliance.

The report provided a series of steps that states and policymakers can initiate in the future to address homelessness among youth with behavioral health needs.

States should establish a cross-agency working group that engages youth and families, conduct a comprehensive view of current policies, and gather a range of stakeholders to identify measures of success. Additionally, policymakers should design and implement policies to improve care and review available data to understand how homelessness intersects with youth and their behavioral needs.