The minister, his wife, two grown daughters and three helpers make up a tiny nonprofit whose food deliveries are part of an experiment that places North Carolina at a leading edge of the new face of Medicaid. A pillar of the nation’s social safety net since the 1960s, Medicaid is the largest public source of health insurance. Now, it is becoming something more.
A growing number of states are broadening the health-coverage program into a hub for fulfilling social needs: helping with housing and transportation, easing past prison life and domestic violence, and providing the cardboard boxes filled with canned goods and perishables that Nichols and his crew deliver in two counties of southeastern North Carolina.
With the encouragement of the Biden administration, Medicaid is threading health-related social needs into the program. Because Medicaid is a joint responsibility of the federal government and states, each project stepping into such new territory requires federal approval. Since President Biden took office three years ago, the Centers for Medicare and Medicaid Services (CMS) has approved these experiments in eight states: Arizona, Arkansas, California, Massachusetts, New Jersey, New York, Oregon and Washington.
An additional nine states have applied, and three others — California and Massachusetts, as well as North Carolina — are asking to update projects they have begun.
“We have states constantly knocking on the door to do this,” said Daniel Tsai, CMS’s Medicaid director.
In a time of political schisms, the enthusiasm is bipartisan. In January 2021, the final days of the Trump administration, CMS suggested to states ways that they could use Medicaid and other public insurance to cope with social needs.
For the Biden administration, the focus on such needs jibes with efforts to lessen health inequities, including the recent U.S. Playbook to Address Social Determinants of Health. CMS worked for more than a year with the White House and other government departments and, in November, produced guidelines on what services states can add under Medicaid — including up to six months’ rent, utility subsidies and nutritious food. States can devote no more than 3 percent of their overall Medicaid spending to such experiments. They must chip in state money and evaluate the effects.
“Clearly, nobody is saying that Medicaid is here to solve all housing and nutritional needs in the country, nor are we here to take over other agencies,” such as the Housing and Urban Development or Agriculture departments, Tsai said. “Does Medicaid have a role in social needs? The answer is yes. … It’s exciting. It’s groundbreaking. It is not an open check.”
Medicaid already was a godsend for Montiara Brown, who hasn’t worked at a steady job since the start of the coronavirus pandemic, when Concentrix, a contractor for the local phone company, closed down. She was on maternity leave, with a baby she named Messiah because he seems a miracle to her, having been told since surgery as a girl that she could never carry a successful pregnancy.
After joining Medicaid in summer 2020, she was able to get glasses to replace a pair she had broken a couple of years before and gone without — even though her vision is so poor she couldn’t make out individual leaves on the ground — hoping her contact lenses wouldn’t rip. She got a Pap smear, and now could get medicine if she got sick.
But she was suffering from asthma and depression living with her toddler in a cramped one-bedroom apartment outside Greenville, N.C., with no floor space between her bed and a little plastic bed for Messiah.
“I was sinking and didn’t have any way out,” Brown, 34, said.
She told a friend last summer that she wished she could move, and the friend suggested she tell the managed-care company that handles her Medicaid. A woman there said it sounded as if she might be a candidate for something called the North Carolina Healthy Opportunities Pilots. When Brown’s phone rang, she nearly didn’t answer, wary of strangers’ calls, but found on the other end a person from Access East, one of three organizations that coordinate community groups under this Medicaid experiment, with questions about Brown’s health and her life. One question was whether she could afford rent month to month. She could, scraping together earnings from babysitting her sister’s kids and her truck-driver father sometimes helping out.
There was no way she could have enough at once for a security deposit and first month’s rent and utility bills. That’s where North Carolina’s experiment came in, picking up those costs.
She remembers still not believing what was happening Oct. 13, when she was handed the key to a two-bedroom apartment with a full kitchen, including a dishwasher she had to be taught to use because she’d never had one before. And for the first time in her life, brand new furniture, including a Spider-Man bed and comforter set for Messiah, who just turned 4.
“I like to go look at him in his own room,” she said. Her old place “was keeping me depressed. It was dark,” Brown said. “If you’re in a place of light, you’ll be light,” she said. Her new apartment has seven windows.
The Medicaid experiment that has led Nichols to hand out food boxes and Brown into a light-filled apartment is part of a trend that has become all the rage lately across a broad swath of the U.S. health-care system.
A “Sync for Social Needs” coalition, announced by the White House in 2022, coordinates health plans, health systems, government agencies and electronic health record vendors in a shared goal of standardizing patients’ records to show whether they have been screened for social risks.
Last year, the National Committee for Quality Assurance, which evaluates health plans and medical practitioners, updated a data tool used by 90 percent of health plans, requiring them to report whether they have assessed patients for shortages of housing, transportation and food.
And Medicare, the federal insurance system for people who are older or have disabilities, ordered doctors seeking bonuses in an incentive pay program to ask patients about food insecurity, unstable housing and personal safety.
A year ago, the organization that accredits U.S. hospitals began requiring them to ask a selection of their patients whether they have unmet health-related social needs and offer advice on getting help.
This wave of attention to social needs grows out of a recognition, going back at least three decades, that social determinants of health — essentially, the conditions in which people live — have an enormous bearing on well-being. Medical care, studies have shown, accounts for only 20 percent of the difference in patients’ health, while social risk factors are responsible for half to 80 percent.
“If you are trying to offer health care to improve health, and [a patient] is not able to afford a healthy diet or have a place to live, you end up spinning your wheels,” said Seth A. Berkowitz, associate professor of medicine at the University of North Carolina School of Medicine.
At its core, the marbling of social services into Medicaid has two goals: improving patients’ health and making a dent in the nation’s exorbitant medical costs.
The new CMS guidelines say that any service a state chooses to include must be based on evidence it makes a difference. It remains unclear whether all this works.
“There is this incredible enthusiasm this will be a magic pill,” said Laura Gottlieb, professor of family and community medicine at the University of California at San Francisco.
Yet for now, “the evidence is not anywhere close to supporting these activities,” said Gottlieb, founding co-director of the Social Interventions Research and Evaluation Network, which focuses on the intersection of social and medical care. “The research is [running] behind the policymakers.”
A 2022 report by the Department of Health and Human Services synthesized research into older projects, largely outside Medicaid, that have tried to help. It concluded that safe and stable housing has been tied to better health, as has availability of nutritious food.
Still, the report acknowledged that many studies have limitations, making it difficult to tell whether the services are the actual cause of improvements in patient health.
Some of the largest evaluations of such efforts have produced unpromising results. A 2018 study by National Academies of Sciences, Engineering, and Medicine assessed programs that provided permanent housing, with other support, for people who had been chronically homeless. Except for those with HIV/AIDS, the study concluded, “there is no substantial published evidence as yet to demonstrate the [housing and other help] improves health outcomes or reduces health-care costs.”
Thomas D’Aunno, professor of management at New York University’s Wagner Graduate School of Public Service, co-wrote a recent article in JAMA Health Forum contending that hospitals, health systems and policymakers should “tread warily” into the realm of social needs, saying such a trend “has real risks,” including diverting money from other useful purposes, and “few prospects of success.”
When it comes to Medicaid with its low-income beneficiaries, D’Aunno said in an interview, “it is a good idea to try. The issue is, how would Medicaid know how to spend money on housing? They don’t have the expertise.” Instead of lowering health-care spending, D’Aunno said, screening Medicaid beneficiaries for unmet needs “uncovers more problems. You find, ‘Oh my gosh, this person hasn’t seen a dentist.’ So the cost goes up for a while.”
The Medicaid projects, UCSF’s Gottlieb said, are “a good opportunity to say, ‘Let’s see what happens.’”
As many parts of the health-care system race to identify patients with unmet social needs that can weaken health, Medicaid is going significantly further, covering services for some of the most vulnerable people.
Oregon is building on an older program to create a path to stable housing. Starting in a few months, it plans to phase in a $1 billion project to provide services to beneficiaries at risk of homelessness or undergoing other transitions, such as release from incarceration or a mental health facility.
The services, predicted to reach about 250,000 of the 1.4 million Oregonians on Medicaid, will include moving assistance and up to six months of rent, help affording utilities, meals tailored to a patient’s medical conditions and climate controls such as heaters and air conditioners.
“I am excited and, admittedly, a little scared,” said Dave Baden, until recently the interim director of the Oregon Health Authority, which runs that state’s Medicaid program. “Does this six months of rent matter to stabilize their lives? Do I know that it will be successful? No. That’s our hypothesis we are testing.”
There are growing pains. One is teaching community organizations to comply with federal medical privacy laws that are part of Medicaid, leaders of a similar project starting in Arizona say. Another is forming partnerships with landlords so the housing stock is adequate.
California is evolving from an earlier experiment in which it allowed managed-care companies in Medi-Cal, the state’s version of Medicaid, to devote some government payments to housing. The experiments from 2016 to 2021 showed reductions in hospital stays and inappropriate emergency room visits, said Lindy Harrington, the state’s assistant Medicaid director.
A new experiment, CalAIM, was launched in 2022 to offer help to Medi-Cal members who are at greatest risk of avoidable use of hospital beds and emergency rooms, have serious mental health or addiction troubles, are homeless or are transitioning from jails and prisons. The program helped about 140,000 people in its first year by connecting them with “community supports,” including housing, meals tailored to medical conditions and respite care after a hospital stay.
Harrington said the goal is “a system that considers not simply the care that happens inside the four walls of the medical system.”
Several years before becoming director of the Centers for Disease Control and Prevention, Mandy Cohen arrived in North Carolina with a vision: The state should be “buying health,” not just health care. North Carolina already had decided to convert its Medicaid program to managed care and, as the state’s health secretary, Cohen proposed it also begin addressing the social drivers of health.
In 2018, a year after Cohen’s arrival, CMS under President Donald Trump approved North Carolina’s experiment. The $650 million Healthy Opportunities Pilots consists of projects in three regions of the state. Delayed by the pandemic, the services — food, housing, transportation and help with “toxic stress” and interpersonal violence — began rolling out in spring 2022.
In each region, an organization chosen by North Carolina’s Medicaid coordinates with social services groups, many of them shoestring nonprofits accustomed to subsisting on grants but never having worked within a government program before. As of December, nearly 16,000 of the 2.8 million North Carolinians on Medicaid had received at least one service.
A preliminary evaluation found that, in the early months, services had managed to start, though it was too soon to know whether the projects were alleviating people’s needs.
“Everyone understands that what we are seeing over a short period of time doesn’t tell the whole story,” said UNC’s Berkowitz, lead evaluator of the experiment.
Access East, a nonprofit in northeastern North Carolina, was selected to coordinate the Medicaid experiment in nine counties, most of them poor and rural with vacant farmland, one-stoplight towns, rickety houses and little public transit. Last year, the nonprofit received $2.3 million to line up community groups, pay salaries, do marketing and community outreach.
“We are still finding things that need to be tweaked or … done completely differently,” said Tina Dixon, vice president for health opportunities at Access East. One challenge is building trust with people wary of accepting help from strangers. Another is teaching small community groups to file claims with the Medicaid bureaucracy.
The biggest “pain point,” Dixon said, has been software built to track beneficiaries with needs, refer them for help and handle invoices and reimbursements. When the software balks, community groups don’t get paid quickly, prompting some to pause services such as food deliveries and car repair, because they cannot absorb the financial risk. Dixon savors the potential to help poor people be well but said, “we are still building this aircraft while we are flying it.”
Nichols, the North Carolina pastor, named his nonprofit CR Resource Center after himself and his wife, Wanda Renee. He navigated the bureaucracy to get a Medicaid number. He went through a background check and signed up for food box delivering through another regional coordinator, Community Care of the Lower Cape Fear.
His wife, with three decades’ experience from a small trucking firm they still operate part of the year, and one of their daughters handle the administrative work. They call new clients, verify locations, set up delivery schedules. The following week, Nichols goes out to introduce himself and invite recipients to let him know if they don’t like green beans so he can put in sweet corn instead.
They have about 350 clients. Nichols’s route takes eight to 11 hours, depending on whether people are in the mood to tell him about personal matters. Medicaid pays $150.36 a trip per client, which covers buying the food and delivering a laden cardboard box, though sometimes Nichols uses his own money to buy meat if he knows someone will be home and can use it fresh.
Later this winter, he plans to expand into a third county.
“Medicaid, that’s the business they are in — to help people in need,” Nichols said. “I might be totally wrong about this, but somebody has got to come to the plate. If not for the government, who?”
