Coverage of Services and Supports to Address Health-Related Social Needs in Medicaid and the Children’s Health Insurance Program
Centers for Medicare & Medicaid Services (CMS) guidance expands how states can use Medicaid and CHIP authorities, such as Section 1115 waivers, to fund services addressing Health-Related Social Needs (HRSN), including housing, utilities, and nutrition support.
The guidance builds on previous Biden administration initiatives to address Health-Related Social Needs (HRSN), which are adverse social conditions, such as housing instability and food insecurity, that CMS claims impact health outcomes. Under this framework, states can cover services like housing navigation, utility assistance, medically tailored meals, and case management for individuals facing social and clinical risks, including those experiencing homelessness, food insecurity, or transitioning from institutional care. CMS provides flexibility to states to use Section 1115 waivers, home and community-based services, and CHIP Health Services Initiatives to fund these services. While CMS limits certain expenses, such as capping rent and housing interventions at six months, it requires states to maintain or increase expenditures on related social services to maintain Section 1115 waivers, “commit to improving payment rates” of medical and psychological services providers, and evaluate HRSN initiatives for effectiveness and budget compliance.
The guidance faces significant legal pitfalls. Medicaid law explicitly limits coverage to “medical assistance,” as defined in Section 1905(a) of the Social Security Act, which refers to the payment of costs for specific healthcare services. Expanding Medicaid to cover HRSN services, such as housing and nutrition, appears to exceed this statutory definition, especially since Medicaid law excludes “room and board” expenses. By classifying these services as eligible under Medicaid, CMS appears to act beyond its statutory authority.
Additionally, Section 1115 waivers are intended for “experimental, pilot, or demonstration projects” that promote Medicaid’s objectives. Approving HRSN services broadly across states undermines the limited and experimental purpose of these waivers, effectively transforming them into a vehicle for program expansion. HRSN interventions like housing and food provision often involve substantial upfront costs, making it difficult, if not impossible, for states to meet the “budget neutrality” requirements mandated under Section 1115 waivers. If CMS permits widespread implementation of these programs, it could be viewed as circumventing statutory limits, exposing states to significant legal risk.
While this guidance does not mandate state adoption, substantial Medicaid matching rates will make it an appealing option for state authorities. Its expansive interpretation of Medicaid’s scope creates a legal gray area, and states should carefully weigh the likelihood of legal challenges, the potential for significant upfront costs, and the possibility of reversal by a new administration.
