CA Health Plans Commit $114M to Address Homelessness, Health Equity

LA Care Health Plan and Health Net have committed to investing $114 million over five years to address homelessness and improve health equity in Los Angeles County.

The health plans have collaborated with the Los Angeles County Homeless Initiative (CEO-HI) to fund two strategies. First, the investment will help secure leases on as many as 1,900 housing units and pay for vacancy coverage, damage repair, trash services, greenspace, maintenance, and pest control.

Second, the funds will help identify the needs of unhoused people through field assessments to determine who requires assistance with activities of daily living (ADL) to move into permanent housing. These assessments are critical as the number of seniors and people with disabilities experiencing homelessness grows.

The investments from LA Care Health Plan and Health Net come after the board of supervisors in Los Angeles Country declared a state of emergency in January 2023 to expedite resources to support unhoused individuals.

The funding is a result of California’s Housing and Homelessness Incentive Program (HHIP), which the state launched with the help of matching funds from the American Rescue Plan Act. The voluntary program allows Medi-Cal managed care plans to earn incentive funds for addressing homelessness and housing insecurity as social determinants of health.

LA Care is providing $80 million to the project, while Health Net will allocate $34 million.

The homelessness crisis is a health equity issue, as many unhoused individuals in Los Angeles County are people of color.

People experiencing homelessness in LA County can receive permanent and time-limited housing vouchers supported by local, state, and federal funding. However, only 65 percent of people issued a voucher are able to lease a unit. Even then, finding a rental takes an average of 122 days.

This may be partly due to Los Angeles’ tight rental market, but landlords may also illegally discriminate against voucher holders, most of whom are people of color.

“When people experiencing homelessness try to use their rental vouchers in the private housing market, they often contend with unaffordable rent, tough competition, and historic and systemic housing discrimination,” Hilda L. Solis, a member of the Los Angeles County Board of Supervisors, said in the press release.

“We’ve entered into this collaboration with LA Care and Health Net during a moment of urgency, but it will expand our housing portfolio over the long term and maximize the use of federal and local rental vouchers to bring people indoors.”

Specifically, the investment from the health plans will help the county secure housing units in the private rental market for people experiencing homelessness who have rental vouchers. The county may direct the funds toward leasing entire apartment complexes, expanding opportunities for shared housing, and providing additional support to landlords.

Through the initiative, leases could last from three to ten years, the press release noted.

“Housing is critical for good health. This collaboration will help address housing inequities, which have resulted in health inequities, and it will make the voucher system more effective,” John Baackes, chief executive officer of LA Care, said. “Securing rental units in advance will ensure vouchers are able to be used and will cut down on the long wait times. At the same time, it will give landlords a long-term funding commitment.”

Most shelters and temporary housing units are designed for people who can take care of their own daily living needs. Unhoused people who need help with ADL, such as bathing, dressing, or getting in and out of bed, are often considered too needy for placement, leading them to remain unsheltered for longer periods.

Los Angeles County will use the funds to create assessment teams that will visit shelters and other housing sites to identify people needing ADL assistance. The teams will also help connect these individuals with caregiver help in temporary or permanent housing.

In addition to supporting these strategies, LA Care and Health Net are funding an evaluation to inform future policies, programs, and investments.