Medicaid Offers Potential Financing Option for Services Including Home Visiting

Jun 27, 2012

By Christine Johnson-Staub

In recent years, home visiting has expanded as an outreach and service delivery strategy that builds on families' strengths to increase parents' capacity for effective parenting and advance the healthy development of children. Home visiting is one tool used to prevent child abuse and improve child well-being by providing education and services in families' homes through parent education and connection to community resources.

Federal Maternal, Infant and Early Childhood Home Visiting (MIECHV) funds have provided additional resources to states to finance home visiting, yet in an era of tight state budgets and increased need, states are exploring new ways to use existing federal funding streams, including Medicaid, to finance this critical support and expand services to additional children and families.

According to a new report from the Pew Charitable Trusts and the National Academy for State Health Policy (NASHP), states may be able to use Medicaid funds to support the delivery of certain home visiting models that provide preventive medical care and coordination, or help connect families to medical homes and other services. According to NASHP's findings:

  • Several states are currently using Medicaid mechanisms to fund home visiting services. These mechanisms include targeted case management, administrative case management (helping eligible recipients access Medicaid services), enhanced prenatal benefits, traditional medical assistance services, and managed care.
  • Home visiting models that seek to deliver health-related child outcomes may be in the best position for Medicaid reimbursement by states. In addition to a number of federally approved evidence based models approved for use under MIECHV, several current examples highlighted in the report use state-developed home visiting models.
  • States considering layering Medicaid and MIECHV home visiting funds to strengthen the sustainability of their home visiting systems should ensure that an interagency agreement is in place between their MIECHV lead agency and their Medicaid agency, to facilitate the administrative end of potential partnerships.

CLASP studies the use of federal funding streams, including Medicaid, to deliver comprehensive and preventive health services to children in early childhood settings. Among the potential federal funding streams, Medicaid poses both great opportunities and great challenges. Some considerations for states exploring the use of Medicaid for comprehensive services include:

  • Using Medicaid funding for direct services may require a state plan amendment (SPA) around allowable uses of funds, as well as the definition of approved service providers. Of the mechanisms identified above, administrative case management and managed care do not require states to file a SPA to cover their delivery via home visiting services.
  • Making amendments to the state plan can be a lengthy and complicated process. However, when all appropriate stakeholders are brought to the table early and the Centers for Medicaid and Medicare Services (CMS) staff are engaged in planning the process can go smoothly.
  • As states struggle with increases in Medicaid costs and federal limits to the Medicaid budget, broadening the use of existing Medicaid dollars may be challenging. On the other hand, the federal government's matching of Medicaid costs (ranging in states from 50-83 percent federal share) makes Medicaid a key funding stream to make state dollars go further.

As states consider Medicaid financing strategies, they may want to consider whether such strategies can be combined with partnerships with family, friend and neighbor (FFN) and other home-based child care providers to help reach the many Medicaid-eligible vulnerable and low-income children who are regularly cared for in those settings.

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