CMS approves AHCCCS housing services expansion project, intended to encourage collaboration between health and housing sectors


Soraya Marashi


The Arizona Health Care Cost Containment System (AHCCCS) is now able to provide Medicaid coverage for up to 6 months of medically necessary transitional housing for Arizonans experiencing homelessness, Arizonans with a serious mental illness (SMI) designation, and young adults transitioning out of the state foster care system.


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CMS authorized the Housing and Health Opportunities (H2O) project with its approval of Arizona’s 5-year extension request for its 1115 Waiver. According to AHCCCS, the H2O project aims to “enhance and expand housing services and interventions for AHCCCS members who are homeless or at risk of becoming homeless” while recognizing that stable housing is a vital component of overall health.

AHCCCS says the project will strive to increase positive health outcomes for these vulnerable populations, including in the stabilization of members’ mental health conditions, reduction in substance use, improvement in the utilization of primary care and prevention services, and increased member satisfaction.

The project also aims to reduce costs to the health care system by successfully housing individuals through the decreased utilization of crisis services, emergency departments, and inpatient hospitalization. 

Joanna Carr, Research and Policy Director at the Arizona Housing Coalition, highlighted the significant amount of funding this project will bring to increase capacity for state housing services and benefit communities across the state.

“We have seen a significant increase in homelessness statewide through the pandemic. [For example], homelessness is up 34% in Maricopa County according to the Point in Time count, between 2020 and 2022,” she said. “While we have received substantial funding through the various stimulus packages that have increased resources such as shelter beds and services, we still have a huge demand and inability to fully meet the needs of every person who is without a home.

The H2O project will bring  increased expertise of health professionals into the housing space, which is an essential need to address the problem. It will also bring more resources into spaces that are not able to meet the full demand, such as increased transitional housing and move-in costs. Essentially, this will allow more people experiencing homelessness to be helped and will lead to more housing placements with wrap-around services that are so needed to increase housing stability.”

Carr said she will be looking forward to seeing greater coordination and collaboration between the housing and health sectors through implementation of the project.

“We have seen the importance of recognizing how health and housing are inextricably linked, such as the link between homelessness, substance use, and mental health,” she said. “In terms of what is missing, I don’t believe any one project or initiative can bring all of the resources needed to address housing and homelessness. 

It takes collaboration, knowledge sharing, and resources from various stakeholders, organizations, and projects working in this space. Therefore, there is always going to be something missing in theory for a specific project. However, what we need to focus on is the gains the community will yield in the implementation of this project simply by bringing increased resources, services, expertise, and opportunity for collaboration.”